Project Management in a Lean World

Translating Lean Six Sigma (LSS)

into the Project Environment

A VELOCITY White Paper

Version1.0

Copyright 2009 Avraham Y. Goldratt Institute, A Limited Partnership.

Project Management in a Lean World

Translating Lean Six Sigma (LSS)
into the Project Environment
Introduction: It's a Lean World
FormostlargeorganizationsintheWesternHemisphere,thecalltopursueadisciplineofim
provementbeganwiththe1980'sNBCbroadcastofIf Japan can... Why can't we? Manyem
barkedonthequalitymovementputtinghumanandfinancialresourcestowardsthatcommit
ment.InvestingintrainingfromDr.EdwardsW.Deming,Dr.TaiichiOhno,andShingeoShingo
aswellasjugglingtheonslaughtofnewtrainingandconsultingorganizationsthatemerged;the
midtolate80'ssawtheintroductionofamyriadoftechniquesmostseemingtohaveathree
letter acronym. Whether it was SPC (Statistical Process Control); TPS (Toyota Production Sys
tem),SMED(SingleMethodExchangeofDie);JIT(JustinTime);orTPM(TotalProductiveMain
tenance);externalandinternalexpertswithdifferenttechniquesdescendeduponthebusiness
units to form numerous Process Improvement Teams, all competing for the same resources
thatwerealreadyfullyneededjusttorunthebusiness.
MotorolaiscreditedwiththeinventionoftheSixSigmamethodology.ThoseinsideMotorola
saw the power of the various techniques from TQM, Deming, Juran and others and evolved
themtoamanagementsystemfocusedonimprovementandthebottomline.Firstaimedat
processes within manufacturing, Motorola then developed the elements to imbed it within
theiroperatingculture.
ThankstoJamesWomackandDanielJonesthroughtheirbookLeanManufacturingandlater,
LeanThinking,thetoolsofthequalitymovementnowhadaframeworktoworkmorecollec
tively the Lean Principles. The principles of specifying value and the value stream; creating
smoothflow;andenablingthecustomertopullvalueandthepursuitofperfectionensuredthe
processofimprovementwouldbeongoing.(ForagoodsynopsisofLeanandSixSigmamethod
ologies please refer to the white paper, Combining Lean, Six Sigma, and the Theory of Con
straintstoAchieveBreakthroughPerformance,byAGIGoldrattInstitute).
BothLeanandSixSigmacontinuetobeheavilyembracedbytheprivateandpublicsectorand
havebecomemoreandmoreintegratedasLeanSixSigma(LSS).Botharewelldeveloped,and
bothenjoythesupportofmanytopexecutives,linemanagers,andavastnumbersofemploy
eesaswell,whohavebeentrainedtoonedegreeoranotherinthesedisciplines.Let'sfaceit,
formostofusitisaLeanworld!

Page1

Whatimplicationdoesthishaveontheprojectenvironment?TheattentiononLeanSixSigma
continuestogrow.TherearewholeofficesanddepartmentssetupforLSS.Fundingavailability
seems plentiful in relationship to other needs. There are growing numbers of experts in LSS
from white belts to green belts to black belts. These many experts and efforts all result in a
broadeningoftheapplicationofLeanSixSigmafromtheshopfloortothewholeorganization
includingtheprojectenvironment!

What is the Project Environment's Point of View to

Being Leaned
AstheLeanSixSigmaeffortsbroadenedintotheprojectenvironmenttherewaslessthanan
enthusiastic greeting. Most project managers and resource managers felt that they were al
ready working in a pretty lean world lean on re
sources, lean on time, and lean on funding! Many It feels pretty lean when one feels they
are already working without a net!
project managers felt that they were already asked
todothenearimpossiblesitontopofanelephant
balancingonaballonahighwiretwentyfeetinthe
airwithoutanet(Figure1).
In trying to "lean" the project environment there
have been a few seemingly insurmountable obsta
cles. To begin with, like supply chain environments,
project environments are made up of a system of
systems.Thisincreasesthedifficultyofdecidingnot
only where to focus but also how to determine the Figure 1. PMs Point of View
mostopportuneareasofwasteandvalue.Addition
ally, when applying definitions and techniques for improving the areas of productivity, focus,
value,wasteandvariationtoaprojectbasedsystem,thereappeartobedisconnectsasLSSs
techniquesanddefinitionsweredevelopedforthemanufacturingenvironmentandappeared
tonotreadilyapplytotheprojectenvironmentwithoutsignificanttranslation.Couplethatwith
thefactthattraditionalprojectmanagementtechniquescontainedintheprojectmanagement
bodyofknowledge(PMBOK)havenotnecessarilyintegratedLean.Nowondertherehasbeena
lukewarmifnotcoolreception.Let'slookattheseissuesmorethoroughlyoneatatime.

Project Environment System of Systems

Therearefoursystemswithinamultiprojectenvironment.Theyarethetaskmanagementsys
tem,theindividualprojectsystem,theportfolioofprojectssystem,andtheresourcemanage
mentsystem.
Page2

Thetaskmanagementsystem(Figure2)consistsof System of Systems Project Environment

In many project environments, there is
thelistoftasksorgroupofinterrelatedtaskswhere
schedule and/or cost management
apersonisresponsibleforensuringthatalltheele
at task or group of tasks level.
Task
listed within the project:
mentsforthattaskarecompletedbythescheduled
date(andoftenwithinthecostestimated).
The detail under the task does not generally
show up in the project schedule, only the overall
task. If one were building a house, this task might
be a task called complete electrical wiring. The Figure 2. Task Management System
crewchiefwouldhaveoneelectricalcrewtooverseepulling110voltwiringtolightsandout
lets;anotherperhapsrunning220voltwiringforsomeappliances;andanothersettingupthe
electricalpanel.
Theindividualprojectsystem(Figure3)consistsofthesequenceoftasks,handoffsanddeliver
ablesthatwhenaccomplisheddeliverthedesiredoutcome.Theindividualprojectsystemmust
manage the delivery of content within a committed time and budget. Very often, scheduling
begins with the various resource func
System of Systems
tions listing their tasks and time (or
At the project level, we have the project system the
sequence of tasks, handoffs and deliverables
levelofeffort)asstandaloneelements.
that when accomplished deliver the desired out-

The individual projectcontent commit

ments are made independently of
other projects task work for shared
resources. Even when shared resourc
ingisconsidered,littlenoticeisgivento
the impact of variability on the releas
ing of a resource from one task to an
Figure 3. Project Environment
other. Also, where project to project
dependencyexists,oftenprojectscommitmentsaremadewithoutconsiderationoftheimpact
ofvariabilityofoneprojectonanother.Anexamplemightbewhentheorganizationisdevelop
ingaprojectwheretheoutputwouldbeusedbyanotherorseveralotherprojects,suchasthe
developmentofanewmicroprocessorthatwillbeutilizedineachsuccessiveproductplatform.
Attheportfolioofprojectslevelsystem(Figure4),alltheprojectsareeithergroupedbyproduct
type,businesstypeororganizationtypethatmustbemanagedtoensureeachcustomerissat
isfied. Unfortunately, the need dates of the customers are not necessarily able to be coordi
natedacrossaportfolio.
Atthislevel,conflictsbetweenprojectsforlimitedsharedresourcesbecomemorevisible.Un

Page3

fortunately, there are often compromises System of Systems

At the multi-project level, we have all the
made which projects will be given higher
projects we must accomplish within a
specific window.
priority for resources versus others, and
manyprojectsstruggleastheyhavetoman
age without the benefit of being the hot
project.
Finally, at the resource management level
(Figure 5), the organization needs to plan
not only what capacities they must have to
supportcurrentandfutureprojectwork,but
also handle how to deploy the current re
sources to the queue of the tasks for each
projecteachwithaprojectand/orportfolio
priority. The managers of this system con
stantlyjugglethecapacityavailableandtask
executionpriorities.
System of Systems
At the resource management level, we are
not only planning what capacities we
must have to support current and
future project work, but how to deploy
them currently at the task, project and
portfolio level.

Figure 4. Multi-Project Environment

Theresourcemanagerisoftenputintotheposi
tionofswitchingresourcesbackandforthtothe
newsqueakiestwheel(task)tryingtospreadthe
capacitywhereitmightdothemostgoodagainst
aseeminglyneverendingqueue.

What do we improve?

Figure 5. Multi-Project Resource Management

Page4

With all these different systems and owners, it

appears that approaching system improvement
inprojectenvironmentsislikethesixblindmen
andtheelephant,theIndianfableimmortalized
in John Godfrey Saxes poem. Project manage
mentsystemimprovementhassomeinteresting
challenges.Therearemanyownersofthesedif
ferent systems, each with their own view of
whatneedstoimprove!Aslongasthesesystems
arenotalignedtoworkinconcert,therewillbe
little opportunity for real improvement. This

means that the relationships between these systems need to be understood. Ultimately, the
capacityoftheorganization(eitherbasedonitslimitedcapacityresourcesortheamountofa
typeofworkthatbecanbetakenoninawindowoftime)shoulddictatehowmuchworkisac
cepted in the portfolio or pipeline. Only then can individual project commitments be made.
Taskprioritiesthenshouldbebasedonthisreleaseofworkandtheactualavailabilityofready
toworktasks.Adjustmentsshouldonlybemadetotasklistprioritieswhenthereisobjective
datathattheprojectrequiresthetasktobeexpedited.Thekeytoimprovementisthisalign
mentofthesesystemsofsystemsand,withthisunderstanding,translatingLeanSixSigmato
drivevalueminimizeswaste.

Translating Lean into the Project System of Systems for Improvement

LeanmanufacturingcouldbesummarizedbywhathasbeenattributedtoEijiToyodaindescrib
ingapillaroftheToyotaProductionSystem:providingexactlywhatthecustomerwants;when
thecustomerneedsit;inthecorrectquantityandintheexpectedsequence,withoutdefects;
atthelowestpossiblecost.Wemustconsidertheimportanceofthisconcept,butapplyitto
eachofthesystemofsystemsinaprojectenvironmentinawaythatalignsthesystem.
In a multiproject environment, we
start by aligning the system of sys
tems (Figure 6) with the capacity of
the organization and the portfolio of
work.Leanwouldmeantakingonthe
right quantity of projects, based on
theorganizationscapacitytodowork
(within a window of time), with the
correctcontent,asquicklyaspossible
to meet each projects needed com
mitmentdate.Forthoseprojectsthat
areagreedtobetakenonbytheport
folio;Leanwouldmeanaccomplishing
therighttasks,intherightsequence,
withthecorrectquality,asquicklyas
possible to deliver exactly what the
customer wants, when the customer
needsit.Fromthere,Leanasapplied
to the Task Priorities would translate
as having the right tasks assigned, in
the right sequence, utilizing the cor

Figure 6. Aligning the Systems in a Project Environment

Page5

rectresources.Next,LeanTaskManagementwouldmeanensuringthattherighttasksareexe
cuted, at the right time, delivering the correct content with the correct quality, as quickly as
possible

Addressing the Disconnects in Lean Techniques for Project

Environments
Asstatedearlier,thereareobstaclesinapplyingLeanSixSigmatotheprojectenvironment.We
havealreadyaddressedtheissueofthesystemofsystemsnatureoftheprojectenvironment.
Itisnowtimetoturnourfocustothosedisconnectswithapplyingdefinitionsandtechniques
derived from a manufacturing environment and applying them directly to a project environ
ment. In particular,wewill look at what is needed to improve productivity, focus, and value,
andtoeliminatewasteandvariation.
Whatisproductivityinaprojectenvironment?Onemightbetemptedtolookatthepercent
loadonthevariousresourcesversustheiravailabilityindecidingiftheprojectenvironmentis
more or less productive after all, this is where the project organizations costs and invest
mentsare.However,thiswouldbetakingthetraditionalefficiencyconceptfromthemanufac
turing floor and directly applying it to the project resources. The organization would only be
measuring how active their resources were rather than how productive they were. Consider
this; working out on a treadmill generates a lot of sweat and does provide a cardio vascular
workout.Yet,ifyourgoalistogofrompointAtopointB,nothinghasbeenaccomplished
thereisactivity,butoneisnotproductiveingettingtoPointB.IfourgoalistogofromPointA
toPointBasquicklyaspossible,thenrunningfasterfromPointAtoPointBismoreproductive
than running slower or stopping periodically to go shopping, eat, or do email! A projects
throughputisonlyachievedwhenitiscomplete.Howquicklyanorganizationcansequencein
thatprojecttoachievethroughputisbasedontheorganizationscapacityinawindowoftime
andisdrivenbyhowmuchworktheresourcescanaccomplish.Itwouldfollowthatspeedof
executionoftherighttasksaccomplishedwiththecorrectcontentandqualitydrivesspeedof
execution of each project and our capacity for the pipeline of work. Productivity must be
viewedfromthetaskperspectivethespeedtoaccomplishthetask.
Arewedrivingtheproductivityoftasks?Arethemetricswithintheprojectenvironmentdriving
inproductivityordotheyactuallydriveinwaste?Insomeorganizations,somekeymetricsare
itemssuchashourschargedoutperperson,resourceutilization,andearnedhours?Thesemet
ricshavelittleornorelationshiptowhetherthehoursworkedwereontherighttasks!Inlook
ingatanexamplefromEarnedValue,wehavetwoenvironments.
Thetoponeshowsthecasewhenweearnhoursonthelongestpathway.Thesecondshows
that the same number of hours has been earned but the tasks that drive project schedule
Page6

havenotbeentouched.Themetricof Activity vs. Productivity

earnedhoursandsubsequentindica
tors of cost and schedule perform
ance(Figure7)maynotalerttheor
ganization that they are not being
productive on the tasks that drive
project completion and the achieve
mentofthroughput!
How does the project environment
usethefiveareasidentifiedbyJames
WomackandDanielJonesasthekey
principlesofLeantoensureimprove
mentwouldbeongoing.Thefiveare:

Figure 7. Activity vs. Productivity

1. Specifyvaluefromthestandpointoftheendcustomer;
2. Identifyallthestepsinthevaluestream;
3. Makethevaluecreatingstepsflowtowardthecustomer;
4. Letcustomerspullvaluefromthenextupstreamactivity;
5. Pursueperfection.

The Five Principles of Lean Applied to the Project

Environment
Specifying Value
Howdowespecifyvalueinprojects?Leanprinciplesstartwithanattempttodefinevaluein
termsofspecificproductswithspecificcapabilitiesofferedatspecificpricesthroughadialogue
withcustomers.TakingthetimetodefinetheProjectValuewillalleviatesomecommonprob
lemsfoundintheprojectenvironment,suchasprojectdefinitiontoovague,lackofstakeholder
support/participation,schedulingwithoutreallyknowingthetruescope,andscopecreep.A
simpletechniqueforspecifyingvaluerevolves aroundansweringsomekeyquestions.Whois
the customer of this project? Is there more than one? Is our own organization also requiring
valuefromthisproject?Istheobjectiveandscopesufficienttosolveeachoftheprojectscus
tomersproblemssowewillnothavetoexpandorredotheproject?Thismeanswemustfirst
establishedtheproblemstatement(s)foreachofthecustomersandonlythenspecifywhatwe
mustdelivertosolvethatproblemandcreatevalue.

Page7

Identify Steps in the Value Stream

Oncewehavedefinedthevaluefromthestandpointoftheendcustomerwemustidentifyall
thestepsinthevaluestreamtheprojectstructureofarrows,tasksandresourcesthatcreate
thatvalue.Toensureeachtask,relationshipandresourceisnotwasted,wecanusesomeguid
ingquestions.Iseachtaskandpathdependencynecessarytoachievethecustomerobjective
isitcreatingvalue?Ifataskisnotcreatingvalue,isitnecessaryforsatisfyingaboundarycondi
tionoftheproject(i.e.maynotuseoutsidecontractorsonconstructingcompetitionsensitive
operatingequipment)?Doesthistaskmeetthecorrectexitcriteriatoprovidethecorrectinput
foritssuccessortask?

Make Value Creating Steps Flow Toward Customer

Asweplantheproject,weneedtoensurethatthevaluecreatingstepsflowtowardsthecus
tomerthedeliverablesthatsolvethecustomersproblems.Weshouldaskwhetherthistask
dependencyisnecessarytoensurewedoitrightthefirsttime(ortominimizeiterationvariabil
ity)andisitworththetimeinvestmentofwaitingforthepredecessortasktocomplete?Isthe
investmentofthistyperesource(highlevelskill)inthistaskappropriatefortheinvestmentof
thelossofthecriticalresourcebeingtiedup?Asthevaluestreamismapped,whatwecallthe
projectnetwork,hopefullymostofthestepswillbefoundtocreatevalue.Additionalstepsmay
belistedandnotaddvaluetotheproductorservice.Thosestepsthatcreatenovalueandthat
shouldbeeliminatedarecalledMudaorWaste.
Howdowedecideifwehavethecorrecttasksandthecorrectdependenciesbetweentasks?
Theanswercanbesummarizedasthecorrecttasksandarrowdependenciesarethosethatare
necessarytodelivertheprojectscopeandsupporttheirsuccessortaskstoenablespeedand
quality.Dowehaveallthetasksthatcreatevalue?Itisimportantinprojectstonotonlyensure
thatweonlyhavetasksandarrowsthatareneededtocreatevalue,butalsothatwehaveno
omissionsoftasksthatareneededtodeliverfullvalue.

Let Customers Pull Value from the Next Upstream Activity

Inexecutingprojectswemustexecuteinawaythatletseachtaskscustomer(successortask,
deliverable)pullvaluefromthepreviousupstreamactivity.Asaprojectscheduleisfollowed,it
mustbefollowedtoensuretaskexecution,arrowdependenciesandresourcesassignmentsoc
curasplannedtominimizewasteandcreatevalueforthecustomer.
Efforts to improve the project system of systems must address the waste that slows task ac
complishment, wastes our limited resources time and increases the costs in projects. Waste
comesfromtwomainareas:Thefirstistheplanwrongtasks,incorrectarrowdependencies,
incorrectplanningofresourcesassigned,missingtasks;andincorrectorincompletecustomer
Page8

requirements..Thesecondareaofwasteoccursduringtheexecutionoftheprojectthemis
alignment of priorities; misuse of limited resource; and misaligned behaviors. We address
wasteissueswithintheprojectplanduringprojectplanningandscheduling.Weaddresswaste
inprojectexecutionwiththealignmentofthesystemofsystems.
WhatiswasteinaprojectenvironmentandwillIknowitwhenIseeit?Dr.TaiichiOhnoidenti
fiedsevencategoriesofwaste(towhichaneighthcategoryhasrecentlybeenadded).Manyof
the definitions for these categoriesare manufacturing based and not project based yet the
categories are very powerful to drive out waste, create speed and increase capacity. These
categoriesaretranslatedasfollows.
Categories of Waste in a Project Environment
The first category of waste is Overproduction. In the project environment, this can translate
intostartingapathortaskbeforeitisavailabletostartorassigningresourcestoanytaskbe
cause you have the resources and not because there is a task needing that resource or that
quantity of resources. Additionally,
overproduction might be seen as do
ingataskaspartoftheproject,when
in fact it is not part of delivering the
valueoftheproject.
Figure 8 depicts an example of what
was planned versus how it was exe
cuted. The organization ends up
spending additional time on a task,
more than was needed and tying up
resources longer for no additional
valueorspeed.

Figure 8. Overproduction

ThesecondcategoryofwasteisWaiting.Sinceproductivityshouldbedefinedashowfastwe
complete a task and hand it off, then
whenataskisinterruptedandwaitsfora
resource that is pulled away to work on
other tasks at the same time the task
experienceswasteinthetimeitwaitsor
is idle while the resource works another
task. This is often the case when a re
sourceismultitasked(Figure9).
Figure 9. Waiting during Multi-tasking

Page9

Anotherexampleofwaitingoccurswhenapredecessortaskcompletesitswork,butdoesnot
passonthatworktothesuccessortask.Thesuccessortaskexperienceswastebywaitingforits
handoff.
ThethirdcategoryofwasteisbasedonthecategoryofTransportation.Transportationwastein
projectsoccurwhenaincorrectpredecessorsuccessortaskdependencyisidentified,resulting
inanunnecessarydelaywaitingforapredecessortasktobecompletedforaninputthatisnot
necessaryforthesuccessortasktostart.Anotherexampleiswhenareviewthatgeneratesa
looping back or re
work loop is later in
the process than it
should be lengthen
ing the project overall
time by the time it
takes to redo the ear
liertasks.
The example shows a
medical review of in
ternal requirements
Figure 10. Transportation: Reviews in the Wrong Place
needed to meet cus
tomerrequirementsforaspecificdrugtrialoccurringafterthetimeintensivecostingprocess
(Figure 10). This review could be done early in the process prior to the more time intensive
tasks,shorteningthequantityandtimeinvestmentoftasksthatmightneedtobereworked.
ThefourthcategoryofwasteisExcessInventory.Inaprojectenvironment,excessinventoryis
representedbyelementsoftoomuchtaskworkinprogress,orresource/resourcegroupsac
complishing more
tasks than the or
ganization
can
process. Addition
ally, some projects
require too many
supplies, unneeded
files, unnecessary
copies of docu
ments or proto
types.Excessinven
tory also occurs Figure 11. Excess Inventory
Page10

whenwerequiremoreofaskilledorlimitedresourcethanthetaskrequires.Insomeproject
environments,theprojectdedicatesresourcestotheprojectforitsentirelength.
Theexample(Figure11)demonstratestheamountofresourcestimededicatedtotheproject
versus the actual need for the resource, creating an inventory of available hours that will be
usedbytheprojectbutnotnecessarilydrivevalue.
The fifth category of waste is Excess Motion. Excess motion occurs in projects when time is
taken on a task that is not inher
ently needed to accomplish the
task to create value. Holding onto
a task that is complete and con
tinuing to polish the output or
searching for a handoff from a
predecessortaskareallexcessmo
tion. Additionally, when a task is
multitasked, time is required for
setting the task down and/or to
pickingitbackup(Figure12).
This time is all nonproductive
from the tasks view point and
thereforewaste.

Figure 12. Excess Motion: Unnecessary set up and set down

of a Task

ThesixthcategoryofwasteisNonValueAddedProcessing.Thiscategorycanincludeinserting
excessiveorredundantreviewsandsignoffs.Italsoincludesthesituationwhereresourcesare
requiredtoaccomplishadditionaltaskswithintheprojectthatarenotpartoftheproject,but
that are included because
the resource may be in a
similar area of work (Figure
13).
This happens frequently in
software development pro
jects where, in making a
changeinapartoftheoper
ating program for the pro
Figure 13. Non-Value Added Processing
ject,theresourcesareasked
toupdatetheprogramminginthesamepartofthecodeforanadditionalneedthatisnotasso
ciatedwithcreatingvaluefortheprojectathand.

Page11

Theseventhcategoryof
waste is Defects. De
fects can take many
formsfromwrong,miss
ing,orincompleteinfor
mation to handing off a
taskthatdoesnotmeet
its exit criteria. The de
fects category also cap
turesthesituationwhen
variability isnt ad
dressed in the project
when it first occurs
(Figure 14). The later
Figure 14. Defects: Not resolving Variability
the variability is discov
ered,themoretimeandtaskareaswillhavetobereworkedcreatingwasteoftime.
The eighth category of waste is Underutilized Re
sources. In many project environments, within the
same skill set, there are goto people. Everyone
wantsthemontheirtasksandintheirreviews.
In the example (Figure 15), the load for the blue
skilledresourceis100percent,butwhenwelookat
theloadbyindividualpractice,oneisloaded170per
cent,whiletheotherisloadedonly30%andisunder
utilized.
Figure 15. Underutilized People

Pursuing Perfection

ThefifthprincipleofLeanthatWomackandJonesciteisthepursuitofperfection.Leanpracti
tionersareaskedtovisualizetheperfectprocess.Nomatterhowmuchyouimproveaproc
esstomakeitleaner,therearealwayswaystocontinuetoremovewastebyeliminatingef
fort,time,spaceanderrors.Therearesixkeywaystopursueperfectioninprojects.Theyare
1. addressvariabilityattheearliestpointintheproject;
2. planhowyoudesiretodotheproject(notthewayyouthinkwillfitorhavealways
doneit);
3. dontcommittoaworkarounduntilyouseeifoneisneeded(orcancheckforany
negativeconsequencesoftheworkaround);
Page12

4. templatebestprojectpracticesintoaPERTorNetworkdiagramanduseforalllike
projects;
5. applyprojectbasedriskmanagementtotheprojectpriortocommencingthepro
ject;and
6. monitor actual to plan for what causes project cycle timeto expand or contract
andreduceallsourcesofvariation(intherightorder).
Howdoesonereducevariationinanenvironmentwhereeachprojectandtaskappearstobe
unique?Again,onehastounderstandthatvariabilitytakesdifferentformsinprojects.There
are four types of variation that can be addressed in the project environment: project scope
variation;taskvariation;iterationvariation;andresourcetoresourcevariation.
Onemajorcauseofprojectscopevariation(scopecreep)isnotgainingfullconsensusonthe
projectscopeupfront.Thisoccurseitherthroughnothavingallofthekeystakeholdersinthe
roomaheadoftimeand/orbynotpursuingthecorrectquestionswiththem.Byhavingthe
correctparticipantsspecifyupfronttheproblem(s)tobeaddressedbytheproject,thegroup
can agree on what really needs to be delivered to solve the problems the resulting project
deliverables.Additionally,withtherightparticipationandtheproblembetterunderstood,the
correctscopeneededisbetterabletobeidentifiedupfrontreducingscopecreep.
Sincetasksinprojectsaremostoftenuniquetothetypeofworkofthespecificprojectand
therefore will not necessarily repeat from project to
project,weoftenneedtofocusonunderstandingwhich
taskshavethegreatestpotentialforpossiblevariability
thelargestspread(longesttails)(Figure16).
Taskvariabilityreferstothedifferenceintimebetween
thetaskgoingprettywell(aggressivebutpossible)and
the potential for things to go wrong (highly probable).
The larger potential
variations can be ad
dressed up front to
minimize their occur
rence by inserting
Figure 16. Task Variability in a Project
predecessor tasks, util
izing different methods or preventing variability from flowing to the task from an upstream
predecessortask.
Iterationvariabilitycanaffecttheabilityofaprojectnotonlytogofaster,butalsotoberelia
blyaccomplished.Inproductdevelopmentitmaybereferredtoasaloop.Aprojectmaygo
through the loop multiple iterations testing, retesting analysis, reanalysis query, re

Page13

queryandsoon.Itcyclesthroughuntilwehavetheresultstheclientcontractedustoachieve
andoruntilweknoweverythingweneedtoknow."(Jacob,Bergland,andCox2009,89).
Iterationvariabilityshouldbeidentifiedduringplanningandcheckedtoseeifitisaresultof
wasteduetodefectsortransportation.Ifso,trytoreducetheiteration.Quantifytheimpact
oftherepeatablevariationwithinandacrossprojectsforapossibleLSSevent.
Manyinprojectenvironmentsbelievethattherearesignificantdifferencesintimetakenbe
tweenskilledresourceswithinagroupresourcetoresourcevariability.Thisvariabilityisof
ten reduced when each resource is allowed to focus on a task without multitasking. If re
sourcetoresourcevariabilityremains,captureandaddressappropriateresourcetoresource
variationwithmentoringprovidedduringprojectexecution.
Attheendofeachprojectcompletion,theteamshouldperformananalysisofthevariability
identifiedbeforeexecutionversusforthevariabilityactuallyincurred.Categorizingthetasks
bywhichtaskmetorbeattheirmoreoptimistic(aggressive,butpossible)timesallowstheor
ganization to better establish the times for planning and for protecting against variability in
thenextproject.Bycategorizingthetasksmetorexceedingthehighlyprobableestimateof
variability,analysisshouldbedoneontheimpactofthesemorevariabletasksimpactthatre
quireprojectrecoveryactions.Whichtypeofvariationishurtingtheprojectthemost?From
which tasks or resource types? Analyze those items which provide opportunity for system
wideleadtimereductionbyaddressingthevariationthroughLSSevents.

Leaning Traditional Project Management

TraditionalProjectManagementwillneedsomerefinementstobecomeLeanallowingmore
projects to reduce their cycle
time.Thereareimprovements
already developed through
the TOC Project Management
(TOC PM) methodologies.
Through TOC PM, the align
mentofthesystemofsystems
is already established. A port
folios work is pipelined
(synchronized) in accordance
with capacity of the organiza
tion. More realistic, but
shorter schedules are created
Figure 17. Task flow towards the customer
byfirstplanningtheworkasa
Page14

moreoftheperfectprocesscalledNetworkBuilding.Inherentinthisprocessistheidentifica
tionofvariability.Theassignmentandexecutionoftasksbasedonthesynchronizedprojects
CriticalChainschedulesallowstheworkoftheprojecttoflowvaluetowardsthecustomer
(Figure17).Capturingactualtoplanandfocusingimprovementallowsmoreeffectiveutiliza
tionofresourcestothetasksthatdriveprojectcycletime.Throughovertwentyyearsofap
plyingthetechniquesofTOCPMtodifferentprojectenvironments,weseethevalueofdriv
ingoutwastefasterandfasterprojects,lesscompromisesandmorecapacityfreedup.

Page15

References
Jacob,Dee,SuzanBergland,andJeffCox.2009.VELOCITY:Combininglean,sixsigmaandthe
theoryofconstraintstoachievebreakthroughperformance.NewYork,NY:FreePress,adivi
sionofSimonandSchuster,Inc.
Ohno,Taiichi.1988.Toyotaproductionsystem:Beyondlargescaleproduction.NewYork,NY:
ProductivityPress.
Saxe,JohnGodfrey.BlindMenandtheElephant
Womack,JamesP.andDanielT.Jones.1996.Leanthinking.NewYork,NY:FreePress,adivi
sionofSimonandSchuster,Inc.

Page16

WhoWeAre
Since1986,AGIGoldrattInstitutehasenabledorganizationstobetteralignthewaytheyoperatewith
whattheyaretryingtoachievestrategicbottomlineresults.
AGIisthebirthplaceofconstraintbasedtechniquesandsolutionsforbusinesssuccess.TheTheoryof
Constraints (TOC) provides the system architecture and the integration of TOCLeanSix Sigma
(TOCLSS)providesthefocusedimprovementprocess.
Manyorganizationsand consultantstracetheirrootsback toAGInotonlyforTOC,but alsoforhow
TOCintegrateswithotherimprovementmethods.

WhatWeDo
AGIprovidesitsclientswithrapid,bottomlineresultswithwhatitcallsVELOCITY apowerfulbusi
nessapproachcombiningspeedwithdirection.VELOCITYconsistsofthreepillars:TOC, thesystem
architecture;TOCLSS,thefocusedimprovementprocess;andSDAIS,thedeploymentframework.
SDAIS(StrategyDesignActivateImproveSustain)beginswithcreatingandthenexecutingthestrate
gic roadmap to ensure business processes are designed and aligned to achieve the strategy. Once
designed,thebusinessprocessesareactivatedtoallowtheorganizationtooperateinastable,pre
dictablemannerwithlessinvestmentandorganizationalchurn.
Once stable, focused system improvements are applied to increase sustainable bottom line results.
Execution Management tools and transfer of knowledge enable each aspect of SDAIS and serve as
thefoundationforselfsufficiencyandsustainment.

WhyAGI
AGIhasexpertiseinTOC,TOCLSS,andSDAIS,withyearsofexperienceadaptingeachoftheseelements
tomeettheuniqueneedsofitsclients,regardlessofsizeorindustry.
AGIexcelsatleadingorganizationsthroughsuccessfulbusinesstransformationsbyprovidingbusiness
assessment,implementationsupport,executionmanagementtools,training,andmentoring.
Wearemotivatedbymakingthecomplexmanageableandenablingourclientsselfsustainingsuccess.

442OrangeStreet
NewHaven,CT06511USA
Tel:+12036249026

PenthouseLevel,SuntecTowerThree
8TemaskBlvd,SINGAPORE038988
Tel:+6597468450
www.goldratt.com