Critical Chain Review

 

By Kathryn Leishman
Avraham Y. Goldratt Institute, Australia New Zealand
April 7, 1997
 
"THE GOAL" APPLIED TO PROJECT MANAGEMENT
 
Mark, Ruth and Fred are tasked with shrinking the development time for
new micro-electronics products. Ted has to work out how to bring
construction projects in ahead of time. Charlie has similar issue in
software programming. They are all interested in knowing how to
manage projects so that they come in on time, within budget and without
compromising on the initial scope. In Eli Goldratt's new management
novel those characters are followed as they attend an Executive MBA
programme and apply the ideas in their companies.
 
Meanwhile, their professor, Dr Rick Silver, has problems of his own.
After five years on probation he has been approved for tenure and the
University calls a halt to all new confirmations of tenure because of
falling registrations. Rick has to prove that he can develop new practical
methods of project management which are of real value to industry. He
has to sell places on the MBA programme even to gain an extension of
his contract for one year.
 
The class learns the Theory of Constraints (TOC) Project Management
Application and the book shows how it can be applied to projects in all
kinds of organisations, large and small, to gain huge improvement in
performance. Where is the safety in projects, how is it wasted and how
can project managers focus on what is important to ensure the deadline
is met. What about behaviour, the "student syndrome", what impact
does it have and how can activities be managed better. And project
planning, how can it be made realistic, reliable and achievable and still
bring in projects successfully ahead of conventional methods.
 
The TOC approach doesn't just work within a company or on a single
project. Roger gets Rick's help to deal with sub-contractors, changing
the method of winning tenders from price to lead time. Charlene helps
UniCo with the decision process of top managers - which projects to
choose, defining the scope of a project and how to evaluate the
alternative investments in projects.
 
This book will change your perceptions on how to manage projects. To
get the benefits for your own company, go ahead and implement it.
 
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By Tu D. Nguyen
Mar 19, 1997
As I asked Dr. Goldratt:
"What is the core problem in project management"
He gave me an answer and also gave me a copy of Critical Chain (the unedited version)
 
Here are my thoughts on Critical Chain:
 
If Microsoft (TM) Window 95 is a turning point for PC's applications, Critical Chain
is a turning point for TOC's applications.
 
The reason is that in every company, there is a project around
the corner; and the way a project is normally managed, cost is a very
important factor to control. Critical Chain maintains that project
managers must control cost and at the same time they must protect
throughput.
 
Otherwise, the "Realistic Estimation" will come back and hunt them.
i.e. there is no rush so start at the last minute, the dependencies
between steps, and multi-tasking...
 
Critical Chain also explains the important issues in project management:
 
- Measurement in project management
- Damage resulting from delaying the completion of a project
- How to negotiate with vendors - The shorter lead-time aspect
- Project-buffer, feeding buffer and resource-buffer
- Resource contention
 
Last but not least, the book clearly points out why the critical chain
is longer than critical path, and what is the real danger in following
the critical path rather than critical chain.
 
If you work in a project environment, you should read and digest Critical
Chain.
 
My prediction: Mr. Bill Gates will have to mofidy MS Project to incorporate
Critical Chain's concept, since companies will not be able to survive if
they manage project according to the cost world.
 
I enjoy reading the book, I hope that you will, too.
 
Tu Nguyen
Jonah
http://www.saigon.com/~nguyent/toc.html

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By Dr. John F. DeVogt

Feb 27, 1997

 

In return for a small favor I did for him, Eli Goldratt sent me a

prepublication copy of his latest book- "Critical Chain." (It is now

due to be published on March 31.) Since its existence has been

mentioned several times on this site, I thought there may be some out

there who would be interested in getting my impressions.

 

First of all, it, too, is written in the form of a novel. Imbedded in

the story are references to Goldratt's actual experiences just as in

his previous books. This time we are not in the presence of Alex Rogo

although there is a connection to UniCo woven into the story line.

The "hero" of the book is a young assistant professor of business who

is long on teaching ability but a bit short on approved publications.

However, he has reached the stage where only the last formal academic

blessing has to be bestowed on him to reach the nirvana of tenure.

Alas, the president of the university pulls the plug on all

promotions and tenure grants in the school of business. How he deals

with the resulting crushing blow to his life constitutes the bulk of

the story. I'll give you a hint: TOC figures prominantly in the

resolution.

 

In choosing this setting, Goldratt involves himself in the growing

phenomenon of companies in this country foregoing the hiring of MBAs

and creating mini-graduate programs in house. He is well aware of the

dangers to academic institutions who are finding (or may find)

difficulty in filling spaces in their graduate business programs-

programs that have been sigificant cash cows other less popular but

essential disciplines on campus. He compares this trend in MBA

programs to what happened to what happened in the not too distant

past to programs in agriculture. Regardless of whether one buys into

that comparison completely, it should give any business school

administrator cause to contemplate what would be the

case if it were true. Naturally, Eli has identified the core problem

here: the products of MBA programs are not what the businesses need.

Never one to find a problem without offering a solution, Goldratt

makes a a very good case for anchoring the MBA curriculum in TOC and its

thinking processes. (Obviously, my judgment here is colored by my

heavy attachment to TOC.)

 

Lest you think that the book is only about academics, let me hasten

to add that there is some very good stuff about project management

and the concept that gives rise to the title of the book. Goldratt

uses the various meetings of the hero's class on project management

to get across the strengths and weaknesses of the traditional

approach to this subject and then to build the case for a TOC-based

approach. Again my judgment my be clouded because I am an academic,

but I found this technique quite effective in providing a feeling of

"naturalness" to a subject that is likely to make quite dull reading if

presented in the traditional text book manner. I truly believe that

non-academics will appreciate this literary device every bit as much

as I.

 

For those on the web who complain that those of us deeply involved in

TOC methodology use too many acronyms and mystical references in our

contributions, take heart. Surprisingly, Goldratt only offers 4 ECs

(evaporating clouds) and a single CCRT (communication current reality

tree). There are some other diagrams but they are not rooted in TOC.

For theose who have not progressed much further into TOC than a

careful reading of "The Goal," this book is definitely up your alley.

As you attend the hero's class, you are provided a review of

important concepts from both "the Goal" and "The Race" as well being

led into the many dimensions of project management. All throughout

the book, the language Goldratt employs is that commonly employed in

business and there is definitely no need for a glossary of terms and

TLAs.

 

One nice touch in the book is that Goldratt honors two academics from

the University of Georgia, Jim Cox and Johnny Blackstone, by giving

their names to the senior professors in the business school who,

along with the hero, lead the charge to anchor the curriculum in TOC.

(He does switch their first names.)

 

I don't have any hesitation in recommending the book to all in the

business and academic communities regardles of how much or how little

they know about TOC. Like Goldratt's other books, there is enough

realism in the story line to safely carry its more technical message

along and the content is well worth the reader's investment of time.

I look forward to using "Critical Chain" in conjunction with "The

Goal" in my production management class and expect that the students

will leave even better prepared for life than is now the case.

 

*********************************

Dr. John F. DeVogt

Professor of Management

Washington and Lee University

Lexington, VA 24450

(540) 463-8609 Fax (540) 463-8639

**********************************

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