There is a cultural approach of waiting till the last minute, the last day, the last week or month to do something. This is a generally BAD idea in principle. In practice it means you're going to be late most of the time. But there is more to this just avoiding work until it is needed. It goes deeper than that. It's like that person who always shows up late for a meeting or rushes through the airport to catch a plane - although I met my wife because of being late for a flight.
If Schedule is King, then the King needs margin
The understanding that "margin" is a rare commodity on every project, we need to take extra effort to acquire some. Without cost and schedule margin, the project is late and over budget before it starts.
The management of "margin" is in the same class as "managing risk." This is how adults manage projects - they manage risk and they manage margin - both cost and schedule.
Margin erosion is the killer of most project success
Let's assume we have schedule margin, but now we need to know how to manage it. The margin management process starts with knowing what the margin "should" be at a point in time, and how much margin we have "burned" at that same point in time. A simple picture of this margin erosion is show by the "burn down chart." The units of measure here are days of "margin" in along the critical path. If the critical path is defined in the naive way most project management book do - the path with zero (0) slack, then you've got a "zero slack" schedule and you're late before you start. The schedule MUST have margin. The critical path is the network path with the LEAST margin (slack on the foreword pass).
Here's the picture used in the domain we work. This picture is reported in the Monthly Management Review (MMR). Float and Margin are used interchangablily here.
What is the Motivation Here?
Constructing a credible Integrated Master Schedule (IMS) requires that sufficient schedule margin be placed at locations in the schedule needed to protect key deliverables. This margin can be selected using company policies. 20 days per year is a typical value. This margin can be selected from “best engineering estimates” from past performance.
A better approach is to use a Monte Carlo simulation tool to assess the needed schedule margin based on a “zero slack” Integrated Master Schedule (IMS) and the known or modeled variances of task durations. This margin analysis starts with the construction of a “best estimate” IMS. Program Events, Significant Accomplishments, Accomplishment Criteria, and their supporting work activities are arranged in a “best path” network.
While there is likely “slack” in some of the activities, a Critical Path exists through this network to each Key Deliverable. This network of activities must show how each deliverable will arrive on or before the contractual need date. This “best path” and the associated Critical Path is the Deterministic Schedule. This is the starting point for the Monte Carlo analysis of the needed schedule margin. Assigning a duration variance for each class of activity, a Monte Carlo model can show the confidence of meeting each contractual delivery date.
This model should show if the probabilistic delivery date occurs on or before the deterministic date with an 80% or greater percentage of the time. With the needed margin for each deliverable indicated by the Monte Carlo simulation, the network is referred to as the Probabilistic Schedule. With the schedule margin inserted in front of each deliverable it may be that the Deterministic schedule cannot be the basis of the Probabilistic schedule. A cycle of rearranging the Deterministic schedule to allow the needed margin is the next step.
The final result is a baselined Deterministic schedule submitted with the proposal – the foundation of the award and the starting point for the Integrated Baseline Review (IBR). This schedule contains the needed schedule margin, revealed through the Monte Carlo simulation, and the assignment of margin tasks to protect key deliverables. As the program proceeds, this schedule margin is managed through a “margin burn down” process. Assessing the use of this margin for the remaining work becomes part of the monthly program performance report.
Here's some past posts on the mechanics of this topic
- Sizing Schedule Margin Using Monte Carlo Simulation
- Critical Path Obsolete? Probably Not
- How do you know you're headed for the ditch?
- Kailash Await's Risk Posts (the Blog BTW is only one of a small handfull that actually have a quntatitive basis for the discussion)
- John Goodpasture's Threats (forget the typo in the title)
- The GAO Cost Estimating Manual's Chapter 14 should be mandatory reading for every PM no matter what domain. It doesn't matter if you NEVER put one word to work, if you don't understand the complexities of project management, you'll always be assuming you're simple and many timems simple minded approaches have merit outside your domain.
