Finding the 'critical elements' in time management and managing them proactively

Playing “Catch Up”

Does it seem that you are always playing “Catch Up” on your projects? Typically, as projects are nearing completion, project managers are using all of their skills and a good deal of overtime to overcome lateness. Some of the inherent causes of getting behind schedule were discussed in an earlier paper (Powell, 1999). For example, activity durations are estimated based on an assumption of normal conditions and a probabilistic confidence level. Events as simple as the short-term illness of a key person can put the project behind schedule. Conflicts in resource usage among projects and disruption in the availability of critical components create unforeseen delays. The tendency of people to mentally gravitate toward the “late finish” date as the required completion of an activity robs the project of valuable buffer time that would absorb the illness and conflict delays. These delays can and will occur in any project. How can their impact on the project be overcome?

Proactive Strategy

The proposed strategy has the project manager proactively building a time reserve or time buffer early (and often) in the project. The project manager spends additional resources to “buy” a time reserve at the beginning of the project, and he attempts to complete early activities in less time than the estimate to increase the time reserve. This time reserve is reflected in the project running ahead of schedule. Then, this time reserve can absorb the adverse random variable effects and the “surprises” that occur in a project. In fact, since these problems occur in all projects, why should an experienced project manager be surprised? He knows that adverse events are going to occur; he just doesn't know specifically when they will happen or what they will be. The way to overcome these setbacks and have the greatest probability of finishing on time is to always be ahead of schedule. This will result from a proactive selective commitment of additional resources early in the project. But, how can the project manager efficiently focus his resources to build this time reserve? He must identify and quantify the critical time constraints on his project and apply resources to improve them. How can the project manager identify these critical time constraints?

“Critical Elements”

A “critical element” in a project is a resource, component, or facility that will potentially determine the project completion date. In other words, the availability of a critical element can be the constraint that will pace the project completion. If the dominant critical element can be found and its availability improved, the project completion date can be improved. When the availability of the dominant critical element is improved and it may be no longer dominant; another element will have become the dominant critical element. The task of the project manager is to improve the availability of each dominant critical element in turn in order to create a time reserve early in the project.

Finding the Critical Elements

A new methodology, called the Critical Element Method, is used to find the critical elements. The normal process steps of Project Initiation and Project Planning are performed as set forth in PMBOK® Guide to produce a network of activities with estimated durations. To add a comfort level, a last null activity may be added that will be a separate time reserve or time buffer. From the desired completion date, a backward schedule calculation pass (as in the Critical Path Method) is done to find the late finish and late start dates for each activity. The resulting baseline schedule has no float time imbedded in it, and it is a Just-In-Time (JIT) schedule. Exhibit 1 shows an example network and baseline schedule.

Since each activity has no float time between its start or its finish and the project completion date, a delay in the start or the finish of any activity will predict an equal delay in the project completion date. For example, if there were a delay in the start or the finish of an activity of 3 days, this would predict a delay in the project completion date of three days. This is very powerful feature of this method because all of the predictions can be reviewed in parallel. This is a significant improvement over the sequential method of the existing software using “what if” trials. From among the predictions of the start of each activity, the latest prediction will dominate the rest of the predictions, and it will have the overriding impact on the project completion date.

Exhibit 1. Baseline Network

Baseline Network

Exhibit 2. Critical Element List

Critical Element List

In order to simplify the communications and record keeping, deviations of the predicted starting dates with respect to the baseline schedule are used. For example, if Activity C has a predicted start date of day 206 and a baseline schedule date to start on day 203, the predicted deviation to the baseline is +3 days. This also predicts that the project completion date will be +3 days, or three days late. Within this method, the deviation is called the delta value; in this case, a delta value of +3 days. In practice, deviations to the plan are usually of most interest and the easiest to communicate.

Internal Constraints and External Constraints

In this method, it is worthwhile to think of each activity as having internal constraints and external constraints. The internal constraints are the upstream or precursor activities in the network. An activity cannot begin until all of the precursor activities have been completed. Constraints that are not on the network are called external constraints. These are all of the components, resources and facilities that are required to start each activity and are called elements. These elements can be listed and monitored separately without being shown on the network, which provides a significant simplification.

The internal constraint for an activity is monitored by the current deviation of the upstream activity with respect to the baseline schedule. For example, if the upstream activity is running four days ahead of its baseline schedule, or –4 days, this would constrain Activity C to not begin more than four days early. If there are multiple precursor activities, the latest will dominate. Similarly, an external constraint may not allow Activity C to begin until two days early, or a deviation of –2 days. The latest of the internal constraint or the external constraint will dominate. In this case, the internal network flow will have to wait two days before the start of Activity C due to the external element. This is the case that is to be avoided. The project manager wants to find these external elements and improve their availability dates so that they do not constrain the internal flow of the network. Usually, the availabilities of these external elements are the most responsive to the commitment of additional resources.

We can analyze the external elements for each activity by listing them and their availability dates and calculating a deviation with respect to the baseline start date of the activity. The latest element will be the dominant external constraint on the activity. Again, since there is no slack time between the completion of the activity in question and the project completion date, there is a direct and one-to-one coupling between them. Therefore, an element that constrains the start of an activity also constrains the project completion date. This relationship allows all of the predictions to be evaluated in parallel. The latest prediction dominates all others in its influence on the project completion date. Therefore, if the dominant prediction on the project completion date is not acceptable and must be improved, the availability of that dominant element must be improved.

For example, if the dominant critical element is constraining the start of Activity C to be +3 days or three days late, assume that by spending an additional $400 the availability date can be improved by five days. The new deviation, or delta value, is –2 days. But, now, it may no longer be the dominant critical element. There may be another element constraining Activity A to be +1 day, or one day late in starting. If this is latest element, it is the new dominant critical element. This is shown in Exhibit 2 and is much simpler than it sounds.

In the first column of Exhibit 2 have been entered the activities of the project. The second column shows the baseline schedule dates for each activity. The third column shows the critical external elements that are the latest constraints for each activity start. The fourth column shows the availability date for each element. And, the fifth column shows the deviation of the availability date with respect to the baseline schedule date, or its delta value. This table simply answers the question: what are the external constraints that limit how early each activity can start? The latest element with respect to its baseline schedule date will dominate the project completion date regardless of the activity it supports. This information is reflected in the delta value for each element.

From Exhibit 2, the project manager can see that the largest delta value (latest date) of +2 days is for the element “Windows.” This is the dominant critical element. This is predicting a late project completion date of two days. In order to improve this constraint, the project manager spends $200 to improve the availability date to day 203. The new delta value is 0. Now, the next dominant critical element is “Crane” with a delta value of +1 day, or one day late. The availability of this element must be improved or the project completion date will be one day late. The project manager only needs to scan the last column to identify each dominant critical element and then act to improve its availability. This results in a direct improvement in the predicted project completion date.

Proactively Building a Time Reserve

In order to build a time reserve, each critical element in turn would be improved to a negative (early) delta value. The first activity in each path will be constrained by only external elements, since there is no upstream activity. Therefore, it should start and finish earlier than the baseline schedule. The next activity should start early. The desire is that external elements do not constrain the start of any activity. The strategy is to have the start of each activity be only internally constrained, rather than have the project flow wait for external elements. To this end, the project manager can determine an external element delta value goal for the project. As long as each external element of the project has a delta value of less than or equal to the delta value goal, no remedial action is required. Any element having a delta value exceeding the goal is referred to the project manager for action. The Critical Element Method has identified the potential external constraints so that the project manager can concentrate on investigating only the critical elements and using his resources wisely. Since the project manager needs only to concentrate on the critical elements, a large amount of communication traffic is no longer necessary. Any updated external element information can be evaluated by anyone by simply computing the updated delta value and comparing it to the current goal.

Monitoring Progress

As the project progresses, the current status of an activity can be reported by using the delta value of the actual date with respect to the corresponding baseline schedule date. For example, if Activity C started on day 201, this is –2 days with respect to the baseline schedule date of day 203. Therefore that path of the project is said to be running –2 days, or two days early. This serves to alert the subsequent activities in the path that they need to be prepared to start two days or more early. This heightened awareness and preparation smoothes the transition between activities.

Step-by-Step

How can a project manager implement the Critical Element Method? The first steps are identical to the PMI Initiation Process and the Planning Process in the Guide to the PMBOK up to and including the backward pass through the network (remember to include the time reserve buffer as the last null activity, if you have an enlightened management). The network with this baseline schedule is published with the request that each activity leader provide a list of external elements and their availability dates and calculated delta values, and the earliest date the activity can start. The latest activity with respect to its baseline schedule date will be the dominant activity and contain the dominant critical element as the latest element on that activity list. The project manager can gather information on the cost to improve that element and subsequent critical elements. Frequently, resources can be shifted to this element from less critical elements at little or no cost. The earlier the critical element is identified the lower the cost of improvement. The project manager can create a list of the critical elements and potential critical elements as shown in Exhibit 2. The project manager can work his way through the list, improving external constraints, starting the first activities early and creating a time reserve at the beginning of the project. The project manager will want to allow some additional contingency time in the predicted availability of the external elements so that if they are delayed slightly, they will not constrain the internal flow. The overriding desire is not to delay the internal flow since it has the largest accumulated investment in time and money. If the updated availability of an external element is predicted to be later, it is easy to quickly determine the impact on the project completion date by calculating its new delta value and comparing it to the project delta value goal published by the project manager.

The pace of the internal flow can be monitored by its deviation from the baseline schedule. If the project manager has been effective, the internal constraint delta value will be negative meaning that the internal pace is ahead of schedule. For example, if a path is running at –3 days, or three days early, the external elements of the downstream activities should be at least this value or they will be the dominant constraint and delay the start of that activity. Publishing the path delta values also acts as an alert so the downstream activities can be prepared to start those activities. The project manager can also balance the path delta values by moving resources from very early delta paths to paths with less early delta values. This balancing operation allows the project manager to make the best use of his resources as he tries to optimize the process.

Summary

Recognizing that adverse time events often occur in projects, we propose a proactive strategy to identify the critical elements in the project and commit additional resources to them in order to build a time buffer early in the project. Identifying and quantifying the critical elements would be done using the Critical Element Method—CEM. Using the CEM, we have created a minimized network with a baseline JIT schedule (without imbedded float time) and have measured predicted deviations (or delta values) from that baseline schedule, defining lateness as being positive. These deviations are independent of one another and can be evaluated in parallel. Each deviation is a direct predictor of the effect on the project completion date in a one-to-one relationship. We then recognized the concept of dominance, in that the largest delta value will determine the final effect on the project completion date. This allows us to identify the dominant critical element, whose availability will determine the project completion date. By improving the availability of that element, the project completion date will be improved by an equal amount, until the next latest critical element becomes dominant. By improving critical element availability early in a project, we can build a time buffer so that the project will begin and run ahead of schedule, thereby being able to absorb the project “surprises.”

References

Project Management Institute. 1996. A Guide to the Project Management Body of Knowledge. Upper Darby, PA: Project Management Institute.

Powell, Roger, and Pierce, Keith. 1999. The Project Manager's Role as Defender of Contingency Time: A New Strategy and Methodology to Minimize the Effects of Risk. Project Management Institute 30th Annual Seminar and Symposium.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

Proceedings of the Project Management Institute Annual Seminars & Symposium
November 1–10, 2001 • Nashville, Tenn., USA

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