Critical Chain - Eliyahu M. Goldratt [47]
Many nod. It must be happening not just at Fred's company, but at others as well.
"Any more good news?"
There isn't any. "Let's see where we stand," I say. "As far as we can tell, there are three different mechanisms by which safety is inserted into the time estimates of almost every step of a project.
"The first one is that the time estimates are based on a pessimistic experience, the end of the distribution curve.
"The second is that the larger the number of management levels involved, the higher the total estimation, because each level adds its own safety factor.
"And the third is that the estimators also protect their estimations from a global cut.
"When you add it all up, safety must be the majority of the estimated time for a project."
Then I ask, "Do you see something strange?"
Charlie is quick to pick it up. "If our estimations include so much safety, how come so many projects do not finish on time?"
"Let's take a specific project, so we can really examine this question," I say. "Is anybody willing to present a case where a project was very late?"
"The Denver airport."
"I mean a project you were involved with. One where you know what really went on."
Ted raises his hand.
Jokingly I say, "Ted, admitting that you had a late project is contrary to the image construction companies try to promote."
He laughs, "We are among friends here. And I have a real case that shows that sometimes projects will be late and you can't do anything about it.
"A year ago, we built a new mall. A big one. We were late by two whole months. We blamed it on last-minute changes, but the truth is that we were struck by particularly bad weather. Also, you can't imagine how many things we had to redo. There was nothing we could do."
"How much time, in total, was lost?"
"About two months. That's why we were late."
"Maybe," I say. "But tell me, what was the original estimate, from start to finish of the whole project?"
"Fourteen months, I think."
"Ted, don't run away from the dilemma we are facing. If most of the time estimates are actually safety, your safety was much more than two months. You shouldn't have been late."
Ted does not agree. "The fact is we were late. I think the reason is that we build safety against regular problems. Somebody doesn't show up, a window is damaged, a bad weather day. That type of thing. We don't plan on major catastrophes."
"I don't buy it," Brian argues with him. "If I understood the probability distribution correctly, we do guard against big surprises. Otherwise, why do we claim that we take two hundred percent safety?"
"Then I don't believe that we take so much safety. At least in our company we don't."
Brian doesn't let him get away with such a statement. "Ha! You are different. But if I'm not mistaken, you told us that in your company, people use estimates that put them in the range of ninety percent probability of finishing each step on time."
The debate between them might develop into something unmanageable. Especially with others trying to jump in. I decide to cut it short. "Well," I say, "is there something wrong in the logic that leads us to assume that so much safety exists? Or is there something fundamentally wrong in the way we are using that safety?"
There is nothing wrong in our logic, and they know it. Even Ted. But that doesn't help them to come up with an answer.
I turn to the board and draw two boxes. "Suppose these boxes represent two consecutive steps in a project. The estimated time for each step is ten days. Now suppose that the first step took twelve days. That means that the second step will start two days later than planned. That's obvious. But what will happen if the first step finishes in eight days?"
"Is