Alfa Ltd., a micro-enterprise established in 1985 in Poznan, specializes in made-to-order wooden houses. Their comprehensive offering includes house design, manufacturing, transportation, assembly, weatherproofing, and maintenance.
To reduce project lead times, avoid delays, and improve delivery consistency, Alfa Ltd. has chosen to implement Critical Chain Project Management (CCPM)—a method based on the Theory of Constraints (TOC) that focuses on resource dependencies and buffer management rather than just task sequences.
Project Overview: Customer Order to Delivery
The typical process involves:
| No | Activity Description | Code |
|---|---|---|
| 1 | Discussion & contract drafting with customer | A |
| 2 | Detailed design documentation | B |
| 3 | Customer approval of project | C |
| 4 | Internal budget preparation | D |
| 5 | Roadmap creation | E |
| 6 | Raw material ordering from Estonia | F |
| 7 | Sending production order to Estonian supplier | G |
| 8 | Production of house parts by Estonian supplier | H |
| 9 | Packing & preparation for transport (done by manufacturer) | I |
| 10 | Transport from Estonia to Poznan warehouse (external logistics partner) | J |
Part A: Network Diagram Using CCPM (with Assumed Durations)
Let’s assume realistic durations (in days) for each activity:
| Activity | Duration (days) | Depends On |
|---|---|---|
| A | 5 | - |
| B | 6 | A |
| C | 3 | B |
| D | 2 | C |
| E | 2 | C |
| F | 4 | E |
| G | 1 | D, F |
| H | 18 | G |
| I | 2 | H |
| J | 4 | I |
Critical Chain Network (Simplified Path)
A → B → C → E → F → G → H → I → J
↘ D ———↗
- Total estimated project time without buffers = 5 + 6 + 3 + 2 + 4 + 1 + 18 + 2 + 4 = 45 days
- However, traditionally estimated as 85 days due to padding, multitasking, and inefficiencies.
Part B: Identifying the Critical Chain
What is the Critical Chain?
The Critical Chain is the longest path through the project network considering resource dependencies, not just task sequences. It accounts for limited resources that cannot multitask.
Assumed Resource Constraints:
- Designer needed for B and D
- Logistics coordinator needed for F, G, and J
- Production manager needed for H and I
These shared resource constraints may extend the path. But in CCPM, we optimize the schedule by eliminating padding and assigning strategic buffers.
Critical Chain (with buffers not included yet):
A (5) → B (6) → C (3) → E (2) → F (4) → G (1) → H (18) → I (2) → J (4)
↘ D (2) —↗
- Critical Chain Duration (No Buffers): 45 days
Buffer Allocation in CCPM
In CCPM, we insert three types of buffers:
1. Project Buffer (PB)
Placed at the end of the critical chain to protect final delivery date.
- Rule of Thumb: 50% of critical chain duration uncertainty
- Assumed Uncertainty Margin: 30% of 45 = ~13 days
- Project Buffer = 13 days
2. Feeding Buffers (FB)
Placed at points where non-critical chains feed into the critical chain, to absorb delays before they affect the chain.
-
D to G Path overlaps with F → G in critical chain. So, we add:
- Feeding Buffer (FB1) after D → G = 2 days
3. Resource Buffers (RB)
Alerts for key resource availability before critical tasks.
- For Production Manager before H
- For Logistics Coordinator before J
- Resource Buffers (alerts) = 1 day each before H and J
Final Project Schedule with Buffers:
| Segment | Duration (days) |
|---|---|
| Critical Chain Activities | 45 |
| + Project Buffer | 13 |
| + Feeding Buffer (D → G) | 2 |
| = Total CCPM Duration | ~60 days |
Outcome: From 85 days (traditional padded estimate) → 60 days (optimized CCPM plan)
Project is protected by buffers and not overloaded by multitasking or Parkinson’s Law.
Benefits for Alfa Ltd.
| Benefit | Impact |
|---|---|
| Reduced Lead Time | Faster customer delivery (25-day improvement) |
| Better Resource Utilization | Eliminates multitasking and chaos |
| Risk Mitigation | Buffers absorb delays and variability |
| Leaner Inventory | Better coordination with Estonian supplier |
| Higher Customer Satisfaction | More reliable commitments |
The implementation of Critical Chain Project Management at Alfa Ltd. enables more reliable project delivery, efficient use of shared resources, and significantly reduced lead times. By focusing on the critical chain and strategically placing buffers, CCPM eliminates the inefficiencies of traditional project planning—especially crucial for custom, made-to-order operations.
Through this approach, Alfa Ltd. is now better equipped to deliver custom wooden homes with precision, agility, and customer satisfaction.
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 for Custom Wooden Homes: Alfa Ltd. Case Study with Network Diagram \u0026amp; Buffer Strategy){kind=link}