Project Management the Theory Of Constraints Way

42 TOCPA International Conference
13-16 May 2019, Johannesburg, South Africa
www.tocpractice.com
Project Management the TOC Way
Combining Critical Chain Project Management
and the 5 Focusing Steps
for astounding results
Philip MARRIS
Marris Consulting
France

42 TOCPA International Conferencewww.tocpractice.com P. 2
Philip Marris
Theory Of Constraints expert.
33 years of TOC experience. Started working
with the founder Eliyahu Goldratt in 1986.
Lean expert.
35 years of experience in Lean. Assists some of
the Leanest organizations in the world.
>30 years of experience helping over 200
companies in all industrial sectors.
CEO of Marris Consulting based in Paris, France.
Motto: Factories, People & Results.
contact@marris-consulting.com
+33 1 71 19 90 40

>30 years of TOC, >200 times
 40% projects, 40% production.
 16 TOC implementations live at the moment.
 All kinds of industries: Aero, Pharma, Luxury
Goods, Aero MRO, Auto, Fast Food…
GKN

Presentation outline
 Introduction
 A few examples
 Conclusion
 Appendices

Introduction
The combination of
Critical Chain Project Management
and the Theory Of Constraints’
5 Focusing Steps
enable extraordinary results to be obtained
in an unbelievably short time.

Portfolios of projects
have capacity constraints
 We consider that there are
two types of constraints
in project environments.
– The constraint of a single project is
its Critical Chain: it determines the
project duration.
– The constraint of a project
portfolio is a resource: it is the
constraint that prevents the system
producing more projects per year.

You can kick-start
a Critical Chain implementation
 Capacity constraints in project portfolios can be
immediately exploited to produce 2 or 3 times
more. This can be done even before you go live
with CCPM.
5 Focusing steps
CCPM
set up
CCPM
go live (fever chart etc.)
and improve
Analysis

Step 1: Identify
 We believe there are nearly
always capacity constraints
(bottlenecks) in multi-project
portfolio environments.
 Experts disagree on this subject.
 But in Marris Consulting's
experience
THERE ARE SIGNIFICANT
BOTTLENECKS.

Step 1: Identify
Find the biggest queue
 Find the bottleneck by finding the
biggest queue.
 This is easy whether or not you have
a project management software.
 Warning: the queue can be smaller
than a shoe box or even "invisible"
(hidden in computers).
Find the biggest queue of work

The very good news
It is easy to multiply
throughput and productivity
by 2 or 3
very quickly

A few examples
In the following examples, several data have been modified for confidentiality reasons.
In all cases the real figures are more spectacular than those presented here.

We use just 3 of
TOC's 5 Focusing Steps (5FS)
1. IDENTIFY the system's constraint(s).
2. Decide how to EXPLOIT the system's constraint
3. SUBORDINATE everything else to the above
decision.
4. ELEVATE the system's constraint
5. WARNING!!!!
If in the previous steps a constraint has been
eliminated, go back to step 1,
but do not allow INERTIA
to become the system's constraint.

Example of world leader
in luxury goods (>$3 billion)
 First iteration:
(of Steps 1 then 2 then 5)
– Bottleneck = Defining
Bill Of Materials
(it had a 5 month queue
in an 15 month process).
– DILO to analyse activity:
30% efficiency.
– Exploit
• + 100% Throughput in one week
• + 70% Throughput in one month
– Lead time reduction
of 77% in 5 months.

(continued) Example of
world leader in luxury goods
 Second iteration:
– Bottleneck = Purchasing (ordering the components).
– Exploit = +60% in 2 weeks.
 Third iteration:
– Woodworking machine shop.
– Currently being dealt with.
100% +70% + 60% = 230%
 230% increase so far => x 3.3

Example
in pharma product development
 A 280 person R&D Department of a leading
Animal Health Pharmaceutical firm.
 They thought that the constraint was their
19 key expert research scientists.
 In fact it was their Industrialization
Department. This had tripled the workload
on the 9 people in this department.
 So the new block buster drugs developed
were all waiting for this department to
define how they were going to be produced.
 Exploit & Elevate: >+200% Throughput.

(continued) Example in
ETO & MTO
 500 person company part of a very big
(>300 000 people) organization.
 It is an Engineering To Order (ETO)
and Make To Order (MTO) business.
 Designs and builds special big gearboxes.
Example: Gearbox between a gas turbine and a
generator in a power plant.

Example in
Engineering To Order (ETO) & MTO
 The bottleneck was in the Design
Office in the Engineering Department.
It was flooded: 90 projects in progress,
50 weeks of lead time, 1,8 projects
(designs) finished per week.

ETO & MTO
 Initially the working conditions in the Design Office were
very bad.
 A DILO (Day In the Life Of) analysis revealed massive
multi-tasking.
– Switching tasks >60 times per day.
i.e. an average of 7 minutes per task.
– This reduced productivity by 70 to 90%.
– It also generated many "silly" quality problems
(for example numerous errors in the Bill Of Materials).
WARNING: multi-tasking kills

ETO & MTO
 New rule: "Start finishing and stop starting".
 Throughput and productivity improved by 130%.
 And during the flushing process by >400%.
CCPM Project start
Weeks
In Out
Design Office Performance (company bottleneck)
1.8 per week
4.2 per week
>8 per week

ETO & MTO
 Lead times were reduced in the Design Office
from 50 weeks to 8 weeks.
CCPM Project start
Weeks
Design Office Work In Progress
This is the
beginning of a
new different
initiative and can
be ignored

Example in
a $10 billion company
 Anonymous, > $10 billion in sales and >20% annual growth.
 After analysing the difficulties that the company had in increasing
annual growth using a "Goal Tree" approach (cf. Bill Dettmer)…
 …the constraint was identified as the I.T. function
(1 200 people internal & externalized).
 Project just about to start. No results yet.
We are finding that I.T. is often the constraint
that limits the growth of a company

Example in
a Medical Devices Manufacturer
 250 person company part of large firm.
 Portfolio managed: all the big
improvement projects (22).
 Bottleneck one person in IT.
 DILO: 30% efficiency (once again!)
This critical resource also managed access badges
for the company…
 5FS:
– Exploit: + 80%.
– Elevate (underway):
Hire another person of course.
Please note: bottlenecks are quite often in I.T.
The capacity constraint
determining the future
performance of the company was
just one person out of 250

Conclusion

The real challenge should be to do
good projects with excellent outcomes
 The goal should not be just to finish one's projects on time and
within budget.
 Critical Chain can put the organization under control and provide
excellent project execution performance.
 But this should then be the foundation for doing projects that
deliver exceptional results (exceptional products and services)…
 …by implementing things such as
Lean Product & Process Development.
Lean Engineering
(Toyota New Product Development System)
Year 1 Year 2 Year 3 Year 4 Year 5

Project performance often
determines a company's future
 Underlying the goal:
"To Make More Money Now And In The Future"
means (we believe) that there are
simultaneously 2 constraints in all companies.
– One that determines short term sales.
– One that determines sales in the future.
 Building future sales is one or 2 portfolios of
projects:
– New product development portfolio.
– Strategic improvements portfolio.
 So increasing the efficiency and throughput of
these portfolios determines the future of
organizations.

You should already have started
your Critical Chain journey
 Using a combination of the 5
Focusing Steps and Critical
Chain Project Management
enables companies to:
– Increase project Throughput
and productivity x2 or x3,
– Reduce project durations by
50% to 80%,
– Finish nearly all projects on
time.

Thank you for your time.
Any questions?
P.S. Do have a look at the 20 pages of information
in the appendices to this presentation.

Appendices

A video website: Marris Consulting's YouTube Channel
Name of channel: "marrisconsulting" (attached)
https://www.youtube.com/user/marrisconsulting/videos
To facilitate viewing and video selection use the
playlists:
• English videos
• Critical Chain videos
• Etc.

A permanent news website dedicated to Theory of Constraints
http://www.scoop.it/t/theory-of-constraints-by-philip-marris

A permanent news website dedicated to CCPM
http://www.scoop.it/t/critical-chain-project-management

A LinkedIn Discussion group dedicated to
Theory Of Constraints
A LinkedIn account is required to access the group
https://www.linkedin.com/groups/84002
Beware there are several with similar names. This one is named: Theory Of Constraints

A LinkedIn Discussion group dedicated to
Beware there are several with similar names. This one is named: Critical Chain Project Management
A LinkedIn account is required to access the group
https://www.linkedin.com/groups/5183858

TOCPA (Theory Of Constraints Practitioners Alliance)
http://tocpractice.com/

TOCICO CCPM Portal
(Theory Of Constraints International Certification Organization)
https://tocico.site-ym.com/?page=project_portal

Victoria University Wellington New Zealand – TOC Database
http://www.victoria.ac.nz/som/research/theory-of-constraints
Reference
Type
Year Title Author Publication Abstract URL
A+ Journal
2016 Zhang, Junguang; Song, Xiwei; Díaz, Estrella European Journal of
Operational Research
Project buffer sizing of a critical
chain based on comprehensive
resource tightness
A buffer sizing method based on comprehensive resource tightness is
proposed in order to better reflect the relationships between activities and
improve the accuracy of project buffer determination. Physical resource
tightness is initially determined by setting a critical value of resource
http://www.sciencedirect.com/scienc
Book Section
2016 Critical Chain Project Management (CCPM) Ellis, George Project Management in Product
Development
This chapter presents critical chain project management (CCPM). The
chapter starts with an overview of the method and then relates it to the
Theory of Constraints, the foundation of the technique. A step-by-step
process is presented to create a plan for a CCPM project including use of
http://dx.doi.org/10.1016/b978-0-12-8
A+ Journal
2015 Quantitative Analysis of Rate-Driven and Due
Date–Driven Construction: Production Efficiency,
Supervision, and Controllability in Residential Projects
Arashpour, Mehrdad;
Wakefield, Ron;
Blismas, Nick; Abbasi,
Babak
Journal of Construction
Engineering and Management
Concerns about production efficiency, quality, and affordability in the
residential construction indicate there may be benefits in adopting alternative
production control strategies to those traditionally used. Reducing adverse
effects of exogenous variability in demand and endogenous variability in
http://ascelibrary.org/doi/abs/10.1061
A Journal
2015 Optimisation of critical chain sequencing based on
activities’ information flow interactions
Zhang, Junguang; Song,
Xiwei; Chen, Hongyu;
Shi, Ruixia
International Journal of
Production Research
One critique for the classic critical chain sequencing methods is that only
resource constraints and logical relationships between activities are
considered, while interactions of information flows are ignored. However,
information flow interactions exist between almost all project activities and
http://www.tandfonline.com/doi/abs/
Other Journals
2015 Productivity of product design and engineering
processes
Hinckeldeyn, Johannes;
Dekkers, Rob;
Kreutzfeldt, Jochen
Operation and Production
Management
Purpose – Maintaining and improving productivity of product design and
engineering processes has been a paramount challenge for design-driven
companies, which are characterised a high degree of development of
products and processes in order to meet particular customer requirements.
http://dx.doi.org/10.1108/ijopm-03-20
C Journal
2015 Inclusion of strategic management theories to project
management
Parker, David W.;
Parsons, Nicholas;
Isharyanto, Fitri
Managing Projects in Business
Purpose - The purpose of this paper is to explore the benefits of integrating
the theory of constraints (TOC), resources-based theory (RBT), resource
advantage theory (RAT), with a structured project-based methodology e.g.,
Project Management Body of Knowledge. This paper describes each theory
http://www.emeraldinsight.com/doi/a
Other Journals
2015 A Model for Continuous Improvement at a South
African Minerals Beneficiation Plant
Ras, E.; Visser, Jk South African Journal Of
Industrial Engineering
South Africa has a variety of mineral resources, and several minerals
beneficiation plants are currently in operation. These plants must be operated
effectively to ensure that the end-users of its products remain internationally
competitive. To achieve this objective, plants need a sustainable continuous
http://www.scielo.org.za/scielo.php?
A Journal
2015 Dynamic monitoring and control of software project
effort based on an effort buffer
Zhang, Junguang; Shi,
Ruixia; Diaz, Estrella
Journal of the Operational
Research Society
The improvement to the monitoring and control efficiency of software project
effort is a challenge for project management research. We propose to
overcome this challenge through the use of a model for the buffer
determination and monitoring of software project effort. This software
http://www.palgrave-journals.com/jo
A Journal
2015 Project management for uncertainty with multiple
objectives optimisation of time, cost and reliability
Jeang, Angus International Journal of
Production Research
This research adopts an approach that uses computer simulation and
statistical analysis of uncertain activity time, activity cost, due date and
project budget to address quality and the learning process with regard to
project scheduling. Since the learning process affects the scheduling problem,
http://dx.doi.org/10.1080/00207543.2
B Journal
2015 Improving performance in project-based management:
synthesizing strategic theories
Karessa, Cullen; David,
W. Parker
Productivity and Performance
Management
http://dx.doi.org/10.1108/IJPPM-02-2
Other Journals
2014 A decomposition heuristics based on multi-bottleneck
machines for large-scale job shop scheduling problems
Zhai, Yingni; Liu,
Changjun; Chu, Wei;
Guo, Ruifeng; Liu,
Cunliang
Journal of Industrial Engineering
and Management
A decomposition heuristics based on multi-bottleneck machines for large-
scale job shop scheduling problems (JSP) is proposed. In the algorithm, a
number of sub-problems are constructed by iteratively decomposing the large-
scale JSP according to the process route of each job. And then the solution
http://www.jiem.org/index.php/jiem/a
Other Journals
2014 COMFRC Addresses Legacy Hornet Readiness Walters, Andrea Naval Aviation News According to PMA-265, 114 aircraft have completed inspections and are
designated for service life extensions beyond 8,000 flight hours, with an
additional 102 aircraft undergoing high-flight-hour inspections at Fleet
Readiness Center (FRC) Southeast, aboard NAS Jacksonville, Fla., and FRC
http://web.b.ebscohost.com.helicon.v
Other Journals
2014 Software Project Management: Theory of Constraints,
Risk Management, and Performance Evaluation
Asseman, Antoine;
Aloraidi, Nada Ashqar;
Salim, Mariam; Rezk,
Eman; Dawoud, Heba;
The Journal of Modern Project
Management
Constraints and risks are two critical factors that affect software project
performance more attention needs to be paid to constraints and risks in order
to improve performance. In this paper, investigation will take place to
determine the relation between those three factors. An enhanced model has
http://www.journalmodernpm.com/in
Book Section
2014 Critical Chain Project Management A Handbook for Construction
Planning and Scheduling
Critical Chain Project Management™ (CCPM) is frequently presented as a
revolutionary new project management concept, an important breakthrough in
the history of project management. CCPM focuses on the uncertainty in
schedule activities and identifies the key activities that, based on time and
http://dx.doi.org/10.1002/9781118838
Other Journals
2014 Critical Chain Method in Traditional Project and
Portfolio Management Situations
Anantatmula, Vittal S.;
Webb, James B.
Information Technology Project
Management (IJITPM)
Critical Path (CP) method has been under scrutiny in recent years as the
next evolution of project schedule development, the Critical Chain (CC)
project management is gaining attention. Advocates of the Critical Chain
method cite the Critical Path method's failure to address uncertainty properly.
http://www.igi-global.com/article/crit
Other Journals
2014 Theory of Constraints and Its Application in a Specific
Company
Linhart, Jakub;
Skorkovskỳ, Jaromír;
Others,
Acta Universitatis Agriculturae
et Silviculturae Mendelianae
Brunensis
This article analyses the possibilities of the practical utilization of Critical
Chain Project Management methodology. Our study analyzed key processes
related to the implementation and utilization of such a tool in a concrete
company. For this purpose an original program was created. The logic of
http://acta.mendelu.cz/62/6/1343/
Conference
Proceedings
2014
Multi-objective optimization model for multi-project
scheduling on critical chain
Wang, Wei-xin; Wang,
Xu; Ge, Xian-long;
Deng, Lei
Advances in Engineering
Software
In this paper, a multi-project scheduling in critical chain problem is addressed.
This problem considers the influence of uncertainty factors and different
objectives to achieve completion rate on time of the whole projects. This
paper introduces a multi-objective optimization model for multi-project
http://www.sciencedirect.com/scienc
C Journal
2014 Mitigating behavioral outcomes in a multiproject
environment: a modified CCPM model
Agarwal, Atul; Larson,
David
Academy of Information and
Management Sciences Journal
Organizations continue to struggle in managing projects that lead to
successful conclusions. While tools such as PERT and CPM have helped the
project management process, they have not produced the level of success as
previously envisioned. In the last decade, a new tool, the Critical Chain,
http://search.proquest.com/openview
C Journal
2014 Mitigating Behavioral Outcomes in A Multi-Project
Environment: A Modified CCPM Model
Agarwal, Atul; Larson,
David
Academy of Information and
Management Sciences Journal
Organizations continue to struggle in managing projects that lead to
successful conclusions. While tools such as PERT and CPM have helped the
project management process, they have not produced the level of success as
previously envisioned. In the last decade, a new tool, the Critical Chain,
http://search.proquest.com/docview/
C Journal
2014 Critical chain and theory of constraints applied to
yachting shipbuilding: a case study
Bevilacqua, Maurizio;
Ciarapica, Filippo
Emanuele; Mazzuto,
Giovanni
International Journal of Project
Organisation and Management
Product development projects, like many other types of projects, often can
exceed their planned schedule by 50% to 100%. Often this is attributed to
uncertainty or the unforeseen. To compensate for this age-old dilemma,
managers and project personnel have learned to compensate by adding
http://www.inderscienceonline.com/d
Conference
Proceedings
2014 The iTLS (TM) model-Integration of Theory of
Constraints, Lean Manufacturing and Six Sigma: A
case study to best practice of operations at a Value
Chain of Multinational in Brazil
Navarro, Carlos I. M.;
Cleto, Marcelo G.
Proceedings of the 2014
Industrial and Systems
Engineering Research
Conference
Recently the three most applied approaches into the Operations Continuous
Improvement are Theory of Constraints (TOC), Lean Manufacturing, and Six
Sigma. However, the high requirements from customers and operations to
obtain products with greater productivity, higher quality and lower prices,
http://search.proquest.com/openview
There is quite a lot of material on Critical Chain Project Management

Critical Chain books

Theory of Constraints books

Other ToC books

Lean books

Theory of Constraints marketing &
awareness activities
5 Permanent news websites (www.Scoopit.com)
– Theory Of Constraints (English & French)
– Critical Chain in (English & French)
– TLS: TOC + Lean + Six Sigma
>250 Free Videos (YouTube Channel)
Discussion Groups (LinkedIn)
– Critical Chain
– TLS: TOC, Lean and Six Sigma
2 dedicated websites in French
– TOC in Production
– TOC in Projects
Others:
– Twitter, Facebook, Etc.

Philip Marris, Founder and CEO of Marris Consulting
Business transformation, Theory Of Constraints and Lean expert
 Transformation programs in industry
 Industrial Excellence Expert (manufacturing and product development).
Recognized expert in Lean, Six Sigma and Theory Of Constraints.Often
combines these ("TLS").
 Author of an industrialmanagement bestseller in France: Le Management Par les
Contraintes en gestion industrielle, Editions d'Organisation [1994, 1996, 2000,
2nd Edition currently underway).
33 years of experience, 58 years old, Manufacturing & Supply Chain expert
Bilingual & bicultural English/French
COMPETENCIES
 Production, Operations & Supply Chain (sample):
– Worldwide automotive OEM tier 1 supplier: increase in Throughput of 17% in 15 minutes. Savings
>$400M per year. saved relationship with largest customer.
– Large MRO (Maintenance, Renewal & Overhaul) Division of a major European railway operator
(France, 25 000 p.): in one of the main factories (940 p.) reduction of the production lead-times for
the renovation of high speed trains from 126 days to 38 days . Further lead-time reductions are
underway over 2 years after the end of our assignment.
– Labour productivity: furniture manufacturer +35% in 6 weeks, M.R.O: 80% in 2 months,
manufacturing equipment (assembly) +70%, ...
– Automotive Supplier (France, 350p.): Increase in the O.E.E. of the bottleneck resource by more than
30%, change from 5x8 shifts to 2x8 while providing the same output.
– Complete reengineering of the Supply Chain of a steel manufacturer: Long term strategic planning,
Sales & Operations Planning, Scheduling. Implementation of TOC/MPC. Increase in 40 points of the
due date performance
– Manufacturer of large machines for cardboard packaging: reduction in the delivery lead-time by over
50% and a reduction in the number of hours of labour per machine of over 30%.
– Aircraft MRO: reduced durations by over 50% and increased productivity by over 80% in 2 months.
 R&D & Industrialisation / Engineering / New Product Development (sample):
– Aeronautical product industrialisation portfolio: reduced durations and projects finish on time
– Complete transformation of an Engineering department of 150 people. Reduction in project durations
of over 40%. Improvement in productivity of over 25%. Projects completed on time went from less
than 30% to over 85%.
– Several aeronautical product development and industrialisation projects involving up to 500 people
per project in up to 6 different simultaneous facilities with budgets up to 20M€ each.
– New product development and product relooking: reduction of over 45% of average project duration,
increase in number of projects completed each year of over 50%.
– New product portfolio analysis and development strategy
– Quotation process reengineering: handling speed multiplied by 4.
MISSIONS / RESULTS
 Over 150 engagements in industry.
 Aeronautical
 Pharmaceuticals
 Automobile industry:car makers and suppliers
 Process industry: steel, glass, cardboard,extruded plastic
 World leader in ball bearings
 MRO rail and aeronautical
 Packaging: cardboard, steel, plastic
 Electrical power systems: world wide leader
 Furniture manufacturer, Marine engine manufacturer, Armoured vehicles
manufacturer, Electronics: printed circuit boards, …
SECTORS / CLIENTS
FORMER POSITIONS
 Cap Gemini Ernst & Young / Bossard Consultant:In charge of Manufacturing
Operations for France & Europe (>200 consultants)
 Cap Sogeti Industrie
 Creative Output: collaborated with E. Goldratt author of The Goal
 Vallourec: Shop floor foreman, Methods Engineer
 Professor at HEC Management School (Supply Chain & Manufacturing).

We are honoured to have been able to
help…

Marris Consulting
Marris Consulting
Factories, People & Results
Tour Maine Montparnasse
27th floor
33, avenue du Maine
Paris 75755 Cedex 15
France
Tel. +33 1 71 19 90 40
www.marris-consulting.com

Project Management the Theory Of Constraints Way

More Related Content

What's hot (13)

Similar to Project Management the Theory Of Constraints Way (20)

More from MARRIS Consulting (11)

Recently uploaded (20)

Project Management the Theory Of Constraints Way