Theory of Constraints Handbook - James Cox Iii [683]
TOC recognizes the existence of interdependency and variability in all organizations; in fact, all of the TOC business solutions are firmly grounded in these tenets, providing tools to better leverage the organization’s Throughput. The interdependencies of the different functional area resources and their corresponding statistical fluctuations, which are manifested as variability, are shown in Fig. 35-4. The three TOC business solution algorithms are as follows.
Project Management
Critical chain is the longest path recognizing task and resource dependency.6 Time buffers of aggregated safety are placed strategically throughout the project, providing much greater protection against variability for the critical chain than conventional critical path methodology. During project execution, monitoring the individual rate of buffer penetration against predetermined acceptable levels will provide real time risk management information. In most cases, this information will be provided early enough to allow for the required action to be taken before the promised delivery date is impacted.
Figure 35-6a is a project network where task A (using Red Resource) is scheduled to take 8 days to finish. The successor tasks when completed will feed into task D, the last task in the project. Traditional project management tools are typically used to schedule work in a Type 1 variability environment. Project management does not normally have a resource queue to provide protection against variability in the scheduling algorithm. Everyone knows that in execution, variability will cause many of the tasks to take longer than anticipated, so the common practice is to embed additional safety time within the task itself.
The TOC project management algorithm, Critical Chain Project Management (CCPM), removes the protection or safety time placed in the individual tasks and schedules only the known time. Then part of the total time removed is placed in the high-risk integration points as a feeding buffer throughout the project network. An additional portion of the removed safety time is placed after the last task as a project buffer. The critical chain is task A + task B + task D and when combined with the project buffer placed at the end of the last task we establish the duration time of the project. In essence, removing the safety time previously embedded in the individual tasks and strategically placing 50 percent in time buffers throughout the project provides much better protection from variability by aggregating the safety time at strategic points (see Fig. 35-6b). This buffer protection allows for establishing control limits and monitoring the rate of time penetration into the feeding and project buffers, providing valuable real-time information of precisely when and where variability is affecting the project. This is crucial for effectively prioritizing where the resources are used when you are resource limited. A more in-depth explanation of the critical chain solution can be obtained in the book Critical Chain (Goldratt, 1997) and in Section III of this Handbook.
FIGURE 35-7a Serial line showing product/service flow.
FIGURE 35-7b Serial line with a buffer inserted prior to the capacity-constrained resource.
Production Floor Scheduling
Drum-Buffer-Rope (DBR)7 provides buffer protection against variability at the most critical parts of the operation. Monitoring the buffer penetration will indicate when and where action must be taken, ensuring very high on-time deliveries. This scheduling algorithm is typically used in a Type 2 environment, where the task itself has low variability and there is a considerable resource queue. Therefore, the most fertile area for reducing cycle time is not in improving the time to