theory of constraints and project management: challenging the dominant paradigm
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McElroy Translation
Theory of Constraints and Project Management:
Challenging the Dominant Paradigm
Bob Donaldson, VP Strategy, McElroy Translation Company
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Setting the Stage: Technology Pressures
CMS/TMS Integration– Automates Localization Project Initiation– Impact on Capacity Planning?
Translation Memory & Advanced Leverage Tools– Improves Translation Reuse– Impact on Translator Involvement?
Collaborative Working Models & Environments– Enables More Parallelism– Impact on Quality Control?
Machine Translation Integration– Improves Translator Productivity– Impact on Business Model?
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Typical Project Problems
Challenges & Symptoms Survey Results (1998)*
Late
Only 44% of all projects finish on schedule or before. The rest tend to be very late. On average, projects are 222% longer than planned.
Over budget By 189%
Fall short of planned technical content
70% of projects
Canceled before finished 30% of projects
Day-to-day chaos & frustrations
Epidemic
No reliable way to measure project status
Until it's too late
Source: National survey conducted by The Standish Group
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Project or Standard Services or Life Cycle?
Localization Project– Historical Usage– Describes Initial Localization of Legacy Material– Implies Unique Set of Goals, Tasks, Challenges
Localization Life Cycle– Standard Component of Product/Content Development– Better Describes Buyer Viewpoint– Implies Regularity & Repetition
Localization Services– Standard Tools, Processes & Deliverables– Better Describes Vendor Viewpoint– Implies Global Perspective on Multi-Project Management
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Service Delivery Challenges
Service delivery depends upon people who …– Do not always work at the same rate– Do not always communicate effectively– Constitute a capacity constraint
Customer satisfaction depends upon …– Service Quality standard processes– Service Responsiveness flexible processes– Management intervention to adjust priorities
Suboptimal processes & metrics often create – Interdepartmental friction– An environment of chaos
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Dilbert’s Perspective on Coordination
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Service Delivery Dilemma
GOAL: Become a Good Service Company
Maintain ConsistentQuality
Meet TimelinessExpectations
Work to StandardProcesses
Work Flexibly
Source: TOC Resultants: www.toc-resultants.com
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PMBOK – The Current Standard
Initiating– Sponsorship, Project Goals, etc.
Planning– Schedule, Budget, Resource Allocation, etc.
Executing– Monitoring, Problem Resolution, QA, etc.
Controlling– Performance/Risk Reporting, Forecasting, etc.
Closing– Delivery, Lessons Learned, etc.
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Why Projects Fail
The Dilbert Principle:
“Anything I don’t understand must be easy.”
Do we really understand the difference between project management & project monitoring?
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Typical Project Plan
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Critical Path
Local ‘Safety Time’ Embedded Throughout
Note the illusion of certainty!
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Typical Plan w/Resource Leveling
Critical Path
Local ‘Safety Time’ Embedded Throughout
Resource Contention
Illusion of certainty remains
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Multi-Project [Standard Services] Issues
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Early Late
Expected Performance
Actual Performance?
Early Late ……
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Parkinson’s Law
1 C. Northcote Parkinson; The Economist, Nov. 1955
Work expands to fill the time available for its completion1
The root problem is “Safety” time!
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Implications for Project Execution
Resources scheduled to maximize utilization Late completion is penalized (obviously)
– So local safety time expands Early completion is also penalized
– “Excess” capacity invites more work– Utilization is often part of performance reviews– Credibility of estimates may be in question
On-time delivery is placed at risk– Current ‘on time’ status not indicative of risk– Time ‘saved’ by early completion is typically wasted– Time ‘lost’ by late completion cascades to subsequent
tasks (and projects!)
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Dilbert’s Perspective on Project Status
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Theory of Constraints – Focus on Throughput
Identify
Exploit
Subordinate
Elevate
Evaluate
Strategic (Corporate) Loop
Tactical (Project) Loop
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Tactical Constraints – Single Project
Goal is to deliver project benefit as quickly as possible
Effective project management involves – Identifying the critical chain of tasks that are
constraining the project’s completion– Exploiting potential capacity constraints
through effective scheduling– Subordinating non-critical tasks & Controlling
uncertainty through buffer management Focus on throughput not utilization
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Theory of Constraints in PMBOK Context
Initiating
Planning– Critical Chain Schedule (vs. Critical Path)
Executing– Maximize Throughput (vs. Utilization)
Controlling– Buffer Management (vs. Task Completion)
Closing
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Back to our Familiar Project Plan
Critical Path
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Critical Chain Plan w/Buffers
Critical Chain
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Critical Chain Plan w/Buffers
Gating Buffer
Constraint Buffers
Feeding BufferProject BufferCritical Chain
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100%100% 100%100%
Typical Resource Utilization PlanAdjusted by removing “safety” time …
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The Roadrunner … Sprint Capacity
Roadrunners have two speeds …
Stopped (but ready for action)
and Fast !
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Roadrunner Advantages
Working to capacity per schedule generates throughput
Not working ahead protects throughput by– Preserving “sprint capacity”– Avoiding unnecessary work– Reducing work in progress
It’s all about throughput!
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Strategic Constraints
Goal is to maximize organizational throughput
“Hard” Constraints– Resource Capacity– Infrastructure Capacity
“Soft” Constraints– Existing Policies– Existing Performance Metrics
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A Few Words on Metrics
Typical metrics are cost-centric– Resource utilization levels– Task duration & on-time completion– Project cost & on-time delivery
We need throughput-centric metrics– $’s of throughput per unit of time– $-days of buffer consumption– $-days of work in progress
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Performance Metrics w/Buffers
Source: http://www.dbrmfg.co.nz
Throughput Dollar DaysLate
Throughput Dollar DaysLate
Near-the-endMiddleBeginning End
Track
Feeding Buffer End Time
0 Buffer
CheckingTime
Constraint Buffer End Time
0 Buffer
CheckingTime
Tracking Zone
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Resolving the Dilemma
GOAL: Become a Good Service Company
Maintain ConsistentQuality
Meet TimelinessExpectations
ConstraintManagement
Buffer Management
Throughput OrientedMetrics
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Summary
Identify the Constraint – Select the best leverage point
Exploit the Constraint– Maximize throughput with system schedule– Protect throughput with project buffers
Subordinate everything else to the Constraint– Beware of legacy performance metrics– Provide for “Roadrunner” responses
Elevate the Constraint– Address capacity or productivity limits
Repeat!
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Further Reading
A Guide to Implementing the Theory of Constraints (TOC). Dr. K. J. Youngman. www.dbrmfg.co.nz
Any book by Eliyahu Goldratt …
TOC Resultants – www.toc-resultants.com
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Contact Details
Bob DonaldsonVP StrategyMcElroy Translation Company910 West AvenueAustin, TX 78701
+1 (512) [email protected]