ESD.36J System & Project Management
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Copyright © 2003James M. Lyneis
Dynamics of Project Performance
System Dynamics and Project Management
Class One (9/23/03)
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Topics
Dynamic project problems
The system dynamics viewpoint
Causes of project dynamics
Overview of system dynamics module
Practice for 9/26-- Vensim model of work flow
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Copyright © 2003James M. Lyneis
Topics
Dynamic project problems
The system dynamics viewpoint
Causes of project dynamics
Overview of system dynamics module
Practice for 9/26-- Vensim model of work flow
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Project Dynamics
What does “dynamic” mean in the context of a project?What are some key measures typically monitored on a project?Sketch “desired” (or planned) and typical actuals for these measures.
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Sketch Plan and Actuals for ...
Time
ProjectStaffing
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Sketch Plan and Actuals for ...
FractionComplete
Time
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1
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Sketch Plan and Actuals for ...
Productivity(Normalised)
Time
1
2
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Trouble-free Projects Behave as Planned: Design Labor (Equivalent People)
Simulated Data100.
75.
50.
25.
0.
TIME91 92 93 94 95 96
Disguised resultsfrom an actualsoftware project
Year 1 Year 5Year 4Year 3Year 2 Year 6
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Design Progress (Percent Complete)Simulated100.
75.
50.
25.
0.
TIMEYear 1 Year 4Year 3Year 2 Year 5 Year 6
Disguised resultsfrom an actual
software project
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Design Labor (Equivalent People)Simulated Data80.
60.
40.
20.
0.
TIME
Disguised results from an actual Ship-building project
Year 1 Year 4Year 3Year 2
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Design Progress (Percent Complete)Simulated100.
75.
50.
25.
0.
TIMEYear 1 Year 4Year 3Year 2
Disguised results from an actual Ship-building project
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But more typically, projects ...
... Surprise us with late requests for additional time or resources... Have schedule and budget overruns... Seem to get stuck at “90%” complete... Result in new products with flaws discovered after release... Hinder learning because of difficulty in comparing the performance of different, “unique” projects
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Typical Project “Disasters”The Channel Tunnel -- original estimate, $3 billion; final cost, $10 billionBoston’s “Big Dig” -- original mid-1980’s estimate, $2.5 billion; latest estimate, $14.5 billion (9/2001)Aircraft development -- nearly double initial estimate (see following slide)New Car Development -- original plan, 400 person-years of effort; final cost, 800 person-years (see following slide)
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On typical development projects ...Design Labor (Equivalent People)
Simulated Actual
Year
800.
600.
400.
200.
0 0 3 6 9 12 15 18 21
ApproximateOriginal Plan
Disguised results from actual aerospace project
… Staffing experiences an extended tail
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Program Staff, Simulated vs. Data (Equivalent Staff)
400.
300.
200.
100.
TIME
0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Simulated Original Plan Actual
Disguised results from actual vehicle project
… Or a second staffing peak
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Two software development projects for the same aerospace company experienced dramatically different results
[see next 3 pages; figures show disguised results shifted so that the 2 projects started in the same year]
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1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
150
100
50
0
Program staff (Program A ...)
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1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
150
100
50
0
Program staff (Program B)
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1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
150
100
50
0
Program staff (Program B vs. Program A)
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What caused the differences between Program A and Program B?
Differences in work scope?
External Conditions?
Management policies and processes?
And how can a company learn from these differences, and therefore
Bid better?
Plan better?
Manage better?
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Sources:Peter Morris and George Hough, The Anatomy of Major Projects, Wiley, 1987.Dr. Edward B. Roberts, Strategic Management of Technology: Global Benchmarking, December 10, 1992 [Results of a survey sponsored by the Massachusetts Institute of Technology, Cambridge, Mass and PA Consulting Group, London, England].
Et cetera:The majority of all development projects fail to meet their time and cost targets, with the overrun typically between 40 and 200 percent.
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Progress has been made: Many firms have cut development times in half ...
Adapted from: Smith, Preston G. and Donald G Reinersten, Developing Products in Half the Time (2nd edition), Wiley 1998.
Company (product)
Sentrol(Glassbreak burglary sensor)
PSC / Spectra-Physics(Magellan bar code scanner)
Xerox Engineering Systems(ES8150 document system)
Kodak(FunSaver camera)
In Focus Systems(LCD projector)
Herman Miller, Inc.(Ambi chair)
In many industries, companies have been able to remove roughly half of the time formerly needed for product development.
0Cycle Length (months)
12 24
Prior Experience
36 48
This Product
R
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PERT and CPM (Critical Path Method)Waterfall, Spiral, …Emphasis on “soft,” people factorsMicrosoft Project
.. and Learning is not happeningWhy???
But project problems persist in spite of numerous advances in the last 30 years
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Why do projects overrun their budgetsand/or schedules?
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Why?
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Topics
Dynamic project problems
The system dynamics viewpoint
Causes of project dynamics
Overview of system dynamics module
Practice for 9/26-- Vensim model of work flow
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Events “Change Occurred,Project behind schedule”
Three ways of looking at a problem --
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Events
Patterns of
BehaviorEst. CompletionDate
Add.Resources
“Project behind schedule”
Three ways of looking at a problem --
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System Structure
EstimatedCompletion
Date
AddResources
BehindSchedule
RemainingWork
Experience Dilution,Quality Problems
Three ways of looking at a problem --
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Events
Patterns of Behavior
System Structure
Est. CompletionDate
Add.Resources
EstimatedCompletion
AddResources
BehindSchedule
RemainingWork
Experience Dilution,Quality Problems
“Project behind schedule”
Three ways of looking at a problem --
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The System Dynamics Viewpoint
Events
Patterns of Behavior
System Structure
External Factors
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The System Dynamics Viewpoint
Events
Patterns of Behavior
System Structure
Low
Medium
High
Ability toInfluence
External Factors
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PERT and CPM (Critical Path Method)Waterfall, Spiral, …Emphasis on “soft,” people factorsMicrosoft Project
.. and Learning is not happeningWhy???
Project problems persist in spite of numerous advances in the last 30 years
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Why??
Project performance problems are fundamentally dynamic problems,
and Managers mental models and typical tools (computer models):
take a partial viewview a project staticallytreat projects as if they were unique
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System dynamics modeling provides a means of ...
... understanding the structure of projects, and how that structure creates behavior;... designing robust projects... learning across projects
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But every project is unique ...
Many similarities, some uniquenessWe will discuss the characteristics of different kinds
of projects later in the term.
SD is a framework for assessing dynamic similaritiesBut, there is no “one way”, “right answer”We will discuss heuristics and rules of thumb during
the course.
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Topics
Dynamic project problems
The system dynamics viewpoint
Causes of project dynamics
Overview of system dynamics module
Practice for 9/26-- Vensim model of work flow
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Examples of Behavior Modes on a Project
ProjectStaffing
Time
TypicalPlan
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Examples (continued)
FractionComplete
Time
.5
1
TypicalPlan
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Examples (continued)
Productivity(Normalised)
Time
1
2Typical
Plan
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The Drivers of Project Dynamics --
The “rework cycle”Feedback effects on productivity and work quality (often “vicious circles”)Knock-on effects between work phasesKnock-on effects between projects
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The Traditional View of a Program
WORKBEING DONE
PEOPLE PRODUCTIVITY
WORKTO BEDONE
WORKDONE
WORK TO DO STAFF % DONE
TIMETIMETIME
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But traditional approaches fail to consider rework
WORKBEING DONE
PEOPLE PRODUCTIVITY QUALITY
WORKTO BEDONE
WORKREALLYDONE
REWORK
WORK TO DO STAFF % DONE
RWK
TIME TIME TIME
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Or Undiscovered Rework
WORKBEING DONE
PEOPLE PRODUCTIVITY QUALITY
KNOWNREWORK
UNDISCOVEREDREWORK
REWORK DISCOVERY
WORKTO BEDONE
WORKREALLYDONE
WORK TO DO STAFF % DONE
RWK
UR REALLY
TIME TIME TIME
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On typical development projects ...Simulated Actual
Year
800.
600.
400.
200.
0 0 3 6 9 12 15 18 21
ApproximateOriginal Plan
Disguised results from actual aerospace project
… Staffing experiences an extended tail
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Caused by the need to accomplish rework
0 3 6 9 12 15 18 21
800.
600.
400.
200.
0
Work Assignments of Staff to...
Original Work
Rework
Total
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Program Staff, Simulated vs. Data (Equivalent Staff)
400.
300.
200.
100.
TIME
0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Simulated Original Plan Actual
Disguised results from actual vehicle project
… A second staffing peak
On typical development projects ...
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Work Assignments of Staff to...
Again caused by the need to execute rework
400.
300.
200.
100.
TIME
0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Original Work Rework
Disguised results from actual vehicle project
Rework
Original Work
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The Rework CycleKey to Project Dynamics
WORK
BEING DONE
People Productivity Quality
Rework Discovery
WORKTO BEDONE
KNOWNREWORK
UNDISCOVEREDREWORK
WORKREALLYDONE
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On a Typical Project, Productivity & Quality Vary Over Time
Why??
Productivity(Normalised)
Time
1
2
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On a Typical Project, Productivity & Quality Vary Over Time
Productivity: AC DesignEquiv. Drawings/Person-Year10.
7.5
5.
2.5
0.
TIME
Why??
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr 11
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On a Typical Project, Productivity & Quality Vary Over Time
Why??
Quality (%): AC DesignQuality Average Quality to Date100.
75.
50.
25.
0.
TIMEYr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr 11
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Why? The Drivers of Project Dynamics --
The “rework cycle”Feedback effects on productivity and work quality (often “vicious circles”)Knock-on effects between work phasesKnock-on effects between projects
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What drives productivity & quality?
UndiscoveredRework
KnownRework
WorkReally Done
WorkTo Be Done
Progress
Rework Discovery
People Productivity Quality
CustomerChanges
Dynamics are initiated by (1) an infeasible initial plan, or (2) changes adding scope and obsoletingcompleted work ...
Scope Growth
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What drives productivity & quality?
UndiscoveredRework
KnownRework
WorkReally Done
WorkTo Be Done
Progress
Rework Discovery
People Productivity Quality
ApparentProgress
CustomerChanges Schedule
Acceleration
Overtime
Hiring
Scope Growth
… that initiate corrective actions to get the project back
on track...
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What drives productivity & quality?
UndiscoveredRework
KnownRework
WorkReally Done
WorkTo Be Done
Progress
Rework Discovery
People Productivity Quality
ApparentProgress
CustomerChanges Schedule
Acceleration
Out-of-SequenceWork, Worksite
Congestion, CoordinationProblems,
Morale Problems
AverageEmployee Skill
and Quality
Fatigue,Burnout
Overtime
Hiring
Scope Growth
… that create vicious circles that undercut intended effects
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A system dynamics model usually represents several phases of work, but is more aggregate than a CPM model
SystemEngineering
Software Codeand Test
HardwareDesign
Hardware Buildand Test
Integrateand Test
SoftwareDesign
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Summary: The Drivers of Project Dynamics --
The “rework cycle”Feedback effects on productivity and work quality (often “vicious circles”)Knock-on effects between work phasesKnock-on effects between projects
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Topics
Dynamic project problems
The system dynamics viewpoint
Causes of project dynamics
Overview of system dynamics module
Practice for 9/25 -- Vensim model of work flow
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Purpose of system dynamics module
Introduction to system dynamics philosophy and concepts, and system dynamics modeling toolsUnderstanding of drivers of project dynamic performanceTaking a “strategic” view of --
project preparation
project planning
risk management
adaptation
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Over Next Four Classes We Will ...
Introduce the SD philosophyLearn one of the SD tools (VENSIM)Build a simple model of one theory of project dynamicsGet a better understanding of what drives project dynamics
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Pugh-Roberts Associates (now a part of PA Consulting Group)
Source of my personal experience on projects
Founded in 1963, by two M.I.T. professors
Dedicated to advancing practical application of system dynamics (SD)
Significant other work applying SD to projects is being done at MIT and in the UK
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Aerospace/ Electronics MissilesRadarsAircraftFire Control SystemsGuidance SystemsSatellites
ShipbuildingDestroyersCarriersSubmarinesFrigatesCommercialAssault Ships
Major Construction Cross-Channel
TunnelNuclear Power
Plants
Large DevelopmentsAir Defense / C3 ITelephone
Switching SystemsShipboard Control
SystemsVehiclesPower Trains
PRA’s project management experience
Over 75 Major Programs
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Uses of System Dynamics Models in Strategic Project Management
Project estimating, planning, and risk assessmentOn-going project managementPricing mid-project changes & dispute resolutionLearning
How can we best balance cost, schedule, scope, and delivered
quality on a project?
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Topics
Dynamic project problems
The system dynamics viewpoint
Causes of project dynamics
Overview of system dynamics module
Practice for 9/26-- Vensim model of work flow
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Practice for 9/25 Class
1. Review the Vensim tutorial2. Construct a model of the basic work
flow on a project in the 3 steps detailed on the following slides
[You can work in teams of up to 2 people. I suggest that you team up with someone who has taken the introductory system dynamics course if possible.]
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Step 1
Construct the simple work flow model illustrated on the next slide. Assume that there are 100 tasks to do, productivity is 1 task/month/person, and that there are 4 staff. Simulate the model for 50 months with a time step of 0.0625 months. What is the behavior of work to do and work done? Does this behavior indicate that additional constraints must be introduced?
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Using Vensim to Model Workflow -- Step 1
Workto Do
WorkDoneWork
Accomplishment
StaffProductivity
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Step 2
Revise the simple work flow model as indicated in the figure on the next slide. Assume that the minimum time to accomplish a task is 1 week. Does work to do and work done now behave reasonably?
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Using Vensim to Model Workflow -- Step 2
Workto Do
WorkDoneWork
Accomplishment
StaffProductivity
Potential WorkRate
Maximum WorkRate
Minimum Time toPerform a Task
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Step 3
Finally, add a project finished "switch" to turn off the application of staff to the project when work done exceeds 99. Use Vensim’s “IF THEN ELSE” function. Does this alter the behavior noted in question 3?
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Using Vensim to Model Workflow -- Step 3
Workto Do
WorkDoneWork
Accomplishment
StaffProductivity
Potential WorkRate
Maximum WorkRate
Minimum Time toPerform a Task
Project FinishedSwitch
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Behavior of Step 3 ModelWork Flows
100
75
50
25
00 5 10 15 20 25 30 35 40 45 50
Time (Month)
Work to Do : Class1 Step3 TasksWork Done : Class1 Step3 Tasks
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Examples of Behavior Modes on a Project
Time
ProjectStaffing
TypicalPlan
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Examples (continued)
FractionComplete
Time
.5
1
TypicalPlan
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Examples (continued)
Productivity(Normalised)
Time
1
2Typical
Plan