Understanding Critical Chain Project Management
By: Scott Johnny
Tags: Supply Chain, Supply Chain Solutions, Supply Chain Management

Critical Chain Project Management (SCPM) is an organizational philosophy that seeks to minimize the risk of project failure by controlling the flow of information that drives projects. A successful team must first establish its framework, or roadmap, which includes the purpose, target market, and resources needed for implementation. Following this, a team develops an action plan, or map, detailing the steps necessary to meet the defined objectives. Finally, team members and their respective managers work together on the implementation of the plan through communication within the framework. This approach to critical chain project management provides a cohesive view of projects and views the projects as a whole.

The first fundamental model in CCPM is the “parkinsonian triangle.” This model depicts three interacting parts: the group of experts executing the plan, the external environment, and the learner. According to this model, the group of experts to execute the plan autonomously, but are subject to the uncertainty of the external environment. The external environment is controlled by two forces: uncertainty about the overall direction of the project and uncertainty about the timing and duration of each step in the execution process. These forces collectively cause the group of experts to anticipate and report the largest possible uncertainty.

The second fundamental model in CCPM is the “feedback” model. In this model, teams receive feedback on the activities and progress of other teams during the critical chain project management process. Feedback not only provide information about progress, but also allow other teams to understand how they are performing against expectations. Other teams can then use this feedback to improve their own performance.

The third fundamental model in critical chain project management is the “feedback hierarchy”. This is based on the work of James Parkinson, who explained the relationship between Parkinson’s law and human behavior. His theory predicts that the way we decide and process information determines our levels of motivation and consequently, the quality and success of every project. The feedback hierarchy model provides a hierarchy of project goals and tasks that each team has to achieve to be successful in its attempts to reach a certain level of completion.

To make it easier for teams to understand and use these three models, CCPM workshops and case studies have been organized. The principle goal of these workshops is to teach teams the correct way of framing and managing their interactions with each other as well as the external environment. After understanding these concepts, teams will know what to expect from each other and what to do to ensure the project proceeds smoothly.

There are a lot of challenges involved in CCPM. One of the most important is to manage uncertainties properly. A lot of planning is needed in project environments because even though the risks may seem low, they can still pose a considerable impact on the outcome. When this happens, managers need to rely on accurate data to provide informed decisions. This is where Parkinson’s law comes in. With this concept, the knowledge of how to monitor and control the variables in critical chain project management was made accessible to everyone.