Eliyahu Goldratt Critical Chain Pdf Download
Osoulo Lejeune
Like Goldratt's book The Goal, Critical Chain is written as a novel, not like a project manager's how-to guide. This book is a story about a professor trying to attain his tenure at a university's business school. The plot is used to maintain interest in the subject and provide a real life feel to the book. It provides plenty of real-world examples. The plot of the novel is fourfold:
The book starts by pointing out the problems with how time estimates are normally done on projects. It then provides a primer on the Theory of Constraints and an example of its implementation in a steel mill. With the foundation set, it proceeds to show how the Theory of Constraints can be applied to schedule generation, resources constraints and multiple projects.
Goldratt claims that the current method of generating task time estimates is the primary reason for increased expense of projects and their inability to finish on time. The commonly accepted principle is to add safety (aka: pad or slop) to generate a task time length that will essentially guarantee the step gets completed. He asserts that estimates for a task are based on individuals providing values that they feel will give them an 80-90% chance of completing the step, these estimates are further padded by managers above this person creating a length of time to complete a task that is excessive - as much as 200% of the actual time required. It is this excessive padding that has the opposite effect - guaranteeing the task will run full term or late. As counter intuitive as this seems, he provides examples of why this is the case. This predisposes the people on the project to consume the time estimate by:
The book presents a primer for Theory of Constraints. This is done in the form of a lecture by a professor who has recently returned from a sabbatical at a large conglomerate that uses the Theory of Constraints. The discussion focuses on the current methods of measuring success at a work center (cost and throughput) and shows how they are contradictory to the success of the production line as a whole.
This philosophy keeps the cost and throughput models at odds with one another since the subordination process necessarily decreases efficiency. Hence, evaluation criteria for properly managing a work center must change to properly reward the organization's success.
The book points out this conflict with respect to an axiom in the Theory of Constraints that states that if two concepts are in direct conflict, then there is an assumption as part of those concepts that is incorrect.
To illustrate, the book uses an example of a steel mill with significant production problems, excess inventory and cost issues. It methodically assigns all the issues of the plant to the method in which success of a work center is measured. The errant assumption is efficiency being measured by tons of steel per hour. The flaw in the measurement is that not all material takes the same length of time to produce and not all work centers have the same throughput. It concludes the sources of the problems for the steel mill are:
After laying this groundwork, the book turns to applying this to Project Management. After declaring the constraint to be the schedule's critical path, the book maps out a set of terms. The result is:
It proposes a method of schedule generation where all tasks are estimated at a reasonable time for completion. This would be a time estimate that would give the resource a 50%-60% chance of completing the task on time. The theory being that one task may take less than its estimated time but another may take more - on the average evening out. Since there is no safety, the conditions above that cause misuse of time on the task do not exist.
Using numerous analogies and examples, the concept of a resource buffer is introduced. This concept claims that one must ensure the resource bottleneck on the critical path is always busy and stays focused. They should be:
The book emphasizes that the project manager has to understand that he or she is not working with absolutes. Resolution of these issues are not absolute. The time estimates are just that - estimates - they cannot be treated as absolute times. This is essential for the following two points.
A project example is given with a single bottlenecked resource on multiple paths. Since this resource is over utilized on multiple paths its tasks need to be considered when determining the project duration. This results in the introduction of the term critical chain - the aggregate of the critical path and the constrained resource leveled tasks.
Projects are going to use common resources. Organizations need to accommodate parallel projects while adhering to the Theory of Constraints concepts. This requires developing a prioritization scheme for the resource to determine the correct order to do work (i.e. proportion of the project buffer remaining). As before, once the scheme has been developed, the resource needs to be focused (not multitasking) on completing the task as soon as possible.
The book closes by introducing a concept for a method for determining which projects should be selected for execution. It is based on looking at the investment in each project in terms of money-days. Money-days is the product of the investment in the project and its duration.
The book was reviewed by a number of academic and business journals including Harvard Business Review [1] and IIE Transactions.[2] In addition, a number of academics have studied Critical Chain Project Management and shown that while the packaging of the content is novel, the ideas are not necessarily original and in some cases, not advisable.[3][4][5][6][7][8]
As the progress of the project is reported, the critical chain is recalculated. In fact, monitoring and controlling of the project primarily focused on the utilization of the buffers. As you can see, the critical chain method considers the basic critical path based project network and schedule to derive a completely new schedule.
However, the methodology does not advocate multi-tasking, and in projects with complex schedule networks, the results of implementing the critical path methodology have proven to be a deterrent to the overall project schedule. In addition, there is no standard method for calculating and optimizing the project buffers. The critical path project management methodology has had a fair amount of success in manufacturing; however, it has not achieved any noteworthy success in the IT industry.
The interactive sessions make a huge difference as I'm able to ask for further clarifications. The training sessions are more engaging than the self-paced modules, it's easier now that i first decided to take up the online classroom training, and then followed it up with the self-paced learning (online and readings).
I wanted to transition into the Project Management field and wanted the right opportunity to do so. Thus, I took that leap forward and enrolled in this course. My learning experience was fantastic. It suited my learning style.
Along similar lines, the event chain methodology of project management focuses on determining the uncertain events and the chain reactions they propagate. It is a method of modeling uncertainties and is based on Monte Carlo analysis, Bayesian Belief Network, and other established simulation methodologies. When they occur, events can cause other events, triggering an event chain, which will effectively alter the course of the project. Events and event chains are identified, and quantitative analysis is performed to determine the extent of the uncertainty and the probable impact of the same on the project. From this exercise, critical event chains are derived, which have the potential to impact the project significantly. Event chain diagrams are visual representations of events, event chains, and their impact.
It is clear that neither the critical path project management methodology nor the event chain methodology can be considered alternatives to the standard methodology for project management as advocated by PMBOK. While the critical path project management methodology can be at best used as a tool for deriving project schedule networks, the event chain methodology for project management can be used as a tool for quantitative risk analysis.
If you are considering working toward your PMP or PRINCE2 exam, Simplilearn offers a variety of project management courses that will help you pass, including the PRINCE2 Foundation Certification Training Course and the PMP Certification Training Course. Our PMP training courses are conducted by certified, highly experienced professionals with at least 10 years of experience.
LinkedIn and 3rd parties use essential and non-essential cookies to provide, secure, analyze and improve our Services, and to show you relevant ads (including professional and job ads) on and off LinkedIn. Learn more in our Cookie Policy.
The themes are explored in the book "Critical Chain" by Eliyahu M. Goldratt address key challenges and limitations commonly encountered in operations management; of the many themes within the book, the below are the themes that are to be driven by the desire to address common operational challenges such as inefficient resource utilization, project delays, and inadequate project planning. Goldratt's critical logic suggests that by understanding and implementing these concepts, organizations can achieve better operational performance, increase project success rates, and enhance overall business outcomes.
7fc3f7cf58