June Chapter Meeting

21 June 2000

"Critical Chain Project Management Methodologies"
by:David Hodes from Prochain Australia

David began his innovative talk by dragging 15 "volunteers" from the capacity audience and putting them to work in three "chain gangs". The chains were 2, 4 and 9 people long respectively. Each person in the chain had to throw a die and request the corresponding number of "units of production" (matches) from the previous person in the chain. The supplier would supply the thrown value or their total holding of units, whichever was the lowest figure. The resulting supply and demand figures were tabulated to reveal that, the longer the chain, the more demand outstripped supply.

The objectives of David's talk were to identify the core issues in project management, understand the source of these problems, understand how the Critical Chain approach (as opposed to Critical Path) addressed these problems, and outline the necessary features of scheduling tools to implement the Critical Chain approach.

Projects tend to be late, over budget and they frequently change in scope. The Standish Group (www.standishgroup.com) quotes that 30% of projects are cancelled before they are finished, 75% of completed projects are late, average cost overruns are 189% and average time overruns are 222%. Change is therefore required, to reduce project leadtimes, help effectively prioritize tasks and resources, provide a global measures feedback mechanism, focused continuous improvement, dramatically improved working conditions, better project performance and cost, and improved bottom-line results.

Traditional management of uncertainty results in multi-tasking our resources, putting "safety" everywhere to protect important dates, constant changes to the schedules to keep them valid constant expediting of hot tasks in an attempt to minimise lateness and starting too man projects to ensure we don’t start too few.

Critical chain management of uncertainty eliminates multi-tasking, produces project schedules without adding safety everywhere, has stable priorities of tasks and resources, establishes proactive feedback mechanisms and ensures that only as many new projects as can be handled, are started.

A (very) brief biography of David Hodes

David Hodes is the Managing Director of the Theory of Constraints Centre Australia (TOCCA), and ProChain Australia. He has consulted to a wide range of companies, including manufacturers, supermarket chains, banks, IT and service companies.

David is the founder of the TOC Centre of Australia. He is a qualified System Thinker and Practitioner. He was awarded a National Engineering Scholarship in the UK and attended Imperial College in London, where he graduated with a BSc Mechanical Engineering ACGI.

His working history includes:

  • Director of a motor parts distribution company in Zimbabwe
  • Managing Director of a distribution business in Johannesburg, South Africa
  • Managing Director of Africa's largest Commercial Refrigeration Company
  • Pioneer adopter of Critical Chain methodology in South Africa (1997)
  • Consulting work to First National Bank IT Division, Wesbank IT Division, the National Productivity Institute and a number of smaller companies.
 

David Hodes, from Prochain, described the theory behind, and some of his experiences of, Critical Chain Project management.
 
 

Hard working PMI Sydney Board Members Jerry Dimos and Deborah Jones, on the reception desk of the bestattended Sydney Chapter meeting in our three-year history.
 
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