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86 CRITICAL PATH, CRITICAL CHAIN, UNCERTAINTY

usually not the case). To this, we generally add a collection factor whenever a
group of tasks come together, providing some margin in case one of the tasks
slips. Similarly, each level of management adds a safety allowance. Finally, on top
of this, everyone knows that the total duration will not be accepted. They expect
to be pushed for a 20 percent reduction, so they add 25 percent to the already
inflated estimate.

Of course, inflated estimates are not news to our readers, and, likewise, Gold-
ratt’s solution, which merits our attention, is far from being original. In fact, I
have written and taught similar concepts of schedule duration management,
schedule risk, and contingency management for more than three decades. See
Risk Management for Dummies: Managing Schedule, Cost and Technical Risk
and Contingency, PM Network, Project Management Institute (October 1995
and April 1996), and in an updated version in Chapter 6.2 of this book.

Another interesting approach to dealing with contingency in schedules is pre-
sented by Bradford Eichhorn. See Manage Contingencies, Reduce Risk: The PCA
Technique, in PM Network, Project Management Institute (October 1997). In the
plan contingency allowance technique, Eichhorn supports my appeal for the spe-
cific identification and management of contingency.

The Shared Contingency Idea

Essentially, any of these solutions might be called shared contingency (my term).
In the Goldratt approach, it is applied in several stages. First, he locates the criti-
cal path and reduces task durations to be consistent with a 50 percent probability
rather than 90 percent. Half of the removed duration is added at the end of the
path, as a project buffer.

Next, the feeder paths are located and treated in a similar manner, and half
of the removed duration is added at the end of each feeder path, as a feeder
buffer. The overall project schedule is reduced. Emphasis is placed on monitor-
ing the project buffer and feeder buffers (for shrinkage), rather than managing
the critical path.

For a more detailed description of the Critical Chain Project Management
(CCPM) method, see the paper by Larry P. Leach, in June 1999 Project Manage-
ment Journal, Project Management Institute.

Critiquing Goldratt’s Concepts

In general, I agree with the concept of shared contingency, represented by the
project buffer and feeder buffer method. But it has to be implemented on a
case basis.