A Project Compression Technique that ALWAYS Cuts Time AND Cost!

Does this sound too good to be true?  It’s not.  It works Every Time.

Issue:

Sometimes a project that must be completed on a specific date begins to lag.   Assuming the project manager was as capable as PMBOK declares they need to be, that project manager will have three usual tools, 1) cutting scope – reduces customer satisfaction, 2) Crashing the Project – vastly increases cost or 3) Fast Tracking – increases cost and adds risk.

Yet – there is a great compression technique available that does ALWAYS result in reduced cost and time!

One must have a firm understanding of Capacity Planning and Human Resources for this to work.

Capacity Planning effect:

Capacity Planning quantifies the effects of non worked and non productive time.  Since the effect of non productive time is 40%, this must adjust the total amount of time required by the project.

Human Resource effect:

Most motivational theorists agree that physical or emotional beating of workers to force them to work harder reduces morale and thereby results in even poorer performance.

So, can motivation be used to increase productivity?  Absolutely.  The only way this works is through incentives.  If you wish to significantly reduce the 40% non productive time, you need to offer them a percentage of the savings as incentive.

Example:

As the project manager, you determine that a reduction of non productive time by half (to 20%) would save $400,000 and cut the project schedule by four weeks.  Therefore, you inform the team that you will provide an even split of $25,000 per week of among team members for every week the project completes early assuming quality goals are achieved.

Morale explodes!  Team members police each other to ensure each team member prospers.

Results:

My personal experience is that the 40% non productive time may be reduced all the way to 5%.  That has a HUGE impact both in budget and in schedule.

Not only can this reduce non productive time, but team members frequently work additional hours that are unreported just to make the bonus.  This offsets some of the 20% non worked time, thereby resulting in additional savings to cost and schedule.

Should the project not come in early, it costs nothing.

Conclusion:

Why would you purposefully incur the additional risk or cost associated with Crashing the Project or Fast Tracking when you can have a tool that improves schedule and cost?