Project management with Critical Chain : high-level study based on Theory of Constraints (TOC) & Critical Chain
Thesis (MBA)--Stellenbosch University, 2001.
Some digitised pages may appear illegible due to the condition of the original hard copy.
ENGLISH ABSTRACT: In a world of increased global competition and the need of customer specific product customisation, the management of projects gets more and more important in order to achieve competitive advantages. By shortening the duration of projects and making project controlling tools more accurate (according to reality), the process of management-decision making is supported and companies can achieve higher profit margins as they are able to concentrate on value-adding parts and to plan future steps efficiently. Critical Chain is a new methodology, which applies Eli Goldratt's Theory of Constraints to project management in order to complete projects faster and with higher predictability while simultaneously making more efficient use of related resources. The Critical Chain methodology uses different concepts to reach these goals: • Average task durations • Aggregating buffer at the end of projects • Counteract against unplanned iterations and other delays • De-conflict resources, both within and across projects. The new project management methodology "Critical Chain" is subject of this research paper. The document is a high-level methodology study, which gives indications, whether, where - and if, how - the concept can be implemented in business environments. The argumentation is based on literature reviews and practical experiences of two pilot implementations in a German heavy industry company, which is internationally operating. In addition, the mini thesis explains basic principles of the Critical Chain approach. Furthermore, main strengths, weaknesses and ideas to improve the methodology are part of the study. Finally, experiences of companies using this methodology as well as an introduction to a Microsoft Project™ add-on, named ProChain©, benchmark the usability of Critical Chain. Critical Chain appears to minimize schedule risk while at the same time minimizing project durations, and has the potential to improve both communication and employee moral. Especially cultural .challenges will be explained, because the human-typical 'resistance to change' is a major hurdle in implementing Critical Chain in a company's project management system. Due to these cultural challenges, Critical Chain is not easy to implement in all parts of a heavy industry company. As the concept is based on mathematical formulas, it is highly recommended that in the beginning only smaller projects with highly qualified employees with a mathematical background (e.g. engineers or other studies in the field of natural sciences) use this concept. As the success of the methodology is dependent on the input of the project members, the whole project team has to understand the principles in front. As such, it is very important that a training course for all people involved is part of the implementation process.
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