ESD.36J System & Project Managementdspace.mit.edu/bitstream/handle/1721.1/80702/esd... · TIME Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Disguised results from an actual software

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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Topics






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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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FractionComplete

Time

.5

1

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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






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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”


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System Structure

EstimatedCompletion

Date

AddResources

BehindSchedule

RemainingWork

Experience Dilution,Quality Problems


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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”


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The System Dynamics Viewpoint

Events


System Structure

External Factors

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The System Dynamics Viewpoint

Events


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






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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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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


RWK

TIME TIME TIME

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Or Undiscovered Rework

WORKBEING DONE

PEOPLE PRODUCTIVITY QUALITY

KNOWNREWORK

UNDISCOVEREDREWORK

REWORK DISCOVERY

WORKTO BEDONE

WORKREALLYDONE


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


Simulated Original Plan Actual


… 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


Original Work Rework


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??


Time

1

2

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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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Why??

Quality (%): AC DesignQuality Average Quality to Date100.

75.

50.

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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 --


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What drives productivity & quality?

UndiscoveredRework

KnownRework

WorkReally Done

WorkTo Be Done

Progress

Rework Discovery


CustomerChanges

Dynamics are initiated by (1) an infeasible initial plan, or (2) changes adding scope and obsoletingcompleted work ...

Scope Growth

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UndiscoveredRework

KnownRework

WorkReally Done

WorkTo Be Done

Progress

Rework Discovery


ApparentProgress

CustomerChanges Schedule

Acceleration

Overtime

Hiring

Scope Growth

… that initiate corrective actions to get the project back

on track...

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UndiscoveredRework

KnownRework

WorkReally Done

WorkTo Be Done

Progress

Rework Discovery


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 --


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Topics





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






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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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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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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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FractionComplete

Time

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1

TypicalPlan

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Time

1

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Plan

Documents

ESD.36J System & Project Managementdspace.mit.edu/bitstream/handle/1721.1/80702/esd... · TIME Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Disguised results from an actual software