Resource optimisation – a new paradigm for project scheduling

Resource optimisation - a new paradigm for project scheduling [P152]

The current focus of CPM scheduling on activities, sequences, float and criticality is failing to deliver successful project outcomes. This paper will look at the alternative approach based on workflows and the optimisation of available resources; the underlying approach in methodologies such as Flow-Line, ToC and Critical Chain (although non of these methodologies use optimisation).

Current CPM scheduling is failing to deliver successful project outcomes.

Most project’s ignore the contract schedule (Glenwright: PM World Today – August 2011)
Terms of contract and penalty clauses don’t work (CIOB report)
Construction project’s have shown no improvement in productivity for 40 years, the rest other industries have shown a 200% improvement (BSI report)
The automatic resource levelling systems in most tools, most of the time, produce sub-optimal results and changing a few settings in any of the tools can produce wildly different outcomes.

There are two solutions to this problem, one is to move to a proper resource optimisation approach (already included, in part, in tools such as Spider) the second is to adopt a more pragmatic approach to scheduling based on ‘what you know’.

The short-term pragmatic approach:

A realistically achievable approach in the short term, can be summarised as ‘plan what you know and budget the rest’. This is the approach adopted in the CIOB ‘Guide to good practice in the management of time in Complex Projects’. The Guide introduces the concept of Schedule Density:

Work more than 12 months in the future is planned at Low Density and defines the long-term strategic commitments of the project
Work more than 3 months in the future is scheduled at Medium Density and defines the tactical approach to achieving the overall strategy set out in the Low Density schedule.
Work in the near term is scheduled at High Density and defines in detail who will be doing what, where and when based on the resources actually available and their measured productivity.

The Low Density schedule is developed and agreed with the client and represents the contractual commitment to deliver the project.

The Medium Density schedule is developed and agreed with the key suppliers and subcontractors, but only for the work planned to be accomplished in the next year or so. It defines the way the organisations committed to the project will achieve the strategic objectives defined in the Low Density schedule.

The High Density schedule is developed and agreed with the people actually doing the work and should be realistic and achievable statement of what will occur in the next 3 months. If this does not achieve the overall strategic objectives, the problems are resolved in the Medium Density schedule so as to minimise disruption to current workflows.

Current scheduling practice has clearly demonstrated that trying to predict detailed resource requirements years in advance when no-one knows who will be doing the work, how effective they will be and frequently what the details of the work actually are is pointless – the only use for this type of schedule is measuring failure after the event. Unfortunately the requirement for a multi-year, detailed, resource loaded schedule is a far too common contractual and legal requirement. The new paradigms proposed in this section of the paper offer a short term solution based on The Guide, that can be adopted on any project using most of the currently available scheduling tools.

A Resource Optimisation approach:

Adopting a resource optimisation approach would involve changing the underlying philosophical approach embedded in CPM from a belief that the pre-determined duration and sequencing of activities takes precedence, constrained by the availability of resources (if resource levelling is used); to one that recognises the real objective of scheduling is to keep the resources working effectively (resource work flows) and any activity sequencing represents a constraint on the locations where resources can work.

This change in approach would represent a totally new paradigm in the modern age, although interestingly, the original objective of CPM was resource optimisation! CPM was dumbed down to its current form to achieve realistic processing times on the computers available in the late 1950s; unfortunately almost no-one has moved on from the basic structure for a CPM model that were fully defined by the early 1960s despite the massive advances in computer power. Re-introducing resource optimisation would result in:

Recognising that activities are variable. Any division of work into activities is arbitrary and can be changed.
Recognising that durations are a consequence of both the quantity and quality of resources actually assigned to the work. The relationship is complex (not simplistic resource driven durations) and capable of optimisation based on the project objectives.
Understanding resource workflows are the core determinant of project outcomes. Optimising resource workflows minimises cost and time outcomes. Sub-optimal or disrupted workflows increases cost and time outcomes (SCL Delay and disruption Protocol).
Some tools that are introducing optimisation capabilities include:

Aurora and Aurora-CCPM: uses advanced mathematical resource-constrained multi-pass algorithms in conjunction with heuristics: http://www.stottlerhenke.com/product/products/aurora-ccpm/
Spider: uses a multi-pass approach: http://www.spiderproject.ru/
pmBLOX: The underlying engine is based on the system dynamics simulation methodology: http://www.pmblox.com
CPLEX CP Optimizer: a 'pure' optimisation tool that uses constraint programming to compute optimised schedules and solve other difficult optimization problems: http://www-01.ibm.com/software/commerce/optimization/cplex-cp-optimizer/

This is a longer term option that could be as radical as the shift from barcharts to CPM. Developing this paradigm will require academic research, resulting in new approaches to software, contracts and the management of projects.

The presentations:

The ideas outlined in this abstract will be developed in two stages.

The initail presentations were Differentiating between activities and work = Resource Optimization, presented at ProjectChat 2011, Sydney, the Construction CPM (C-CPM) conference, Orlando and PMOz, Melbourne 2012. The focus of these presentations was to outline the shortcomings of CPM, review the alternative methodologies and approaches including Flow-Line, ToC, Critical Chain, Momentology, Location Based Scheduling, and RD-CPM, then consider the additional requirements needed to fully implement resource optimisation. The first part of the presentation will outline the concept followed by a discussion period with colleagues at the conferences.
Based on feedback from the above, the full paper, Resource optimisation - a new paradigm for project scheduling will be developed.

Author: Patrick Weaver

Sydney 22-24th November		Construction CPM Conference January 21-25, 2012 Walt Disney World, Florida
PMOZ 2012 15 to 16 August The Sebel and Citigate Albert Park, Melbourne