Critical Chain Solar Project Management

As margins in the solar industry have decreased to single digits, contractors are looking for ways to control soft costs. Two crucial ways are to ensure that you do not have to return to a site to fix a mistake, and to make sure that you are not holding up the next task in line. This is where tight project management controls come in. In this article, I investigate a project management style called critical chain project management, or critical chain, which can help your team hit project deliverables on time and on budget.

First I review the progression of project management styles that informed the development of critical chain. Then I explain the mechanics and philosophy of critical chain. I conclude with a brief example of how to deploy it. Results will be best with complex and long-duration projects such as commercial and utility-scale projects. However, residential solar contractors can learn a lot from critical chain that they can apply to their projects.

A Brief History of Project Management

Critical chain project management is the culmination of improvements in project management methodologies dating back to the early 20th century. These earlier methodologies include the Gantt chart, the program evaluation review technique (PERT) and the critical path method.

Gantt chart. The most common and simplest type of project management is the Gantt chart. Developed by Henry Gantt circa 1910 and used extensively in World War I, a Gantt chart is an illustration of a project schedule using a bar chart to show the start and finish dates of a project.  Project managers start by developing a work breakdown structure consisting of multiple work packages, as shown in Figure 1. Today, most Gantt charts also show relationships of dependency between various activities; some charts also have features, such as percent-complete shading bars, that allow users to view the current project status. (For more information, see “Managing PV Installations with a Gantt Chart,SolarPro, October/November 2013.)

PERT. In 1957, the US Navy Special Projects Office developed PERT to support the large and complex Polaris nuclear submarine project. PERT is a method of analyzing project tasks and completion times to identify the minimum time needed to complete the total project. Because the technique accommodates uncertainty, users do not need to have a precise understanding of project details and activity durations to schedule a project. Instead, they employ best case, worst case and average timelines for tasks. Unlike a Gantt chart, which is oriented around start date, completion date and percentage of completion for individual tasks, PERT charts focus more on displaying the dependencies between tasks, as shown in Figure 2.

Critical path method. Morgan R. Walker and James E. Kelley of Remington Rand developed the critical path method in the late 1950s. Building on the project network framework developed for PERT, critical path is the longest progression of tasks dependent upon each other within a network of all project tasks. This project management methodology is premised on documenting the actual process of completing a project rather than a theoretical process. It documents all the project activities, the duration of each activity, dependencies between activities, and the major milestones and endpoints.

Critical chain method. Developed in 1997 by Eli Goldratt, critical chain is a methodology for planning, executing and managing projects. Goldratt first introduced it in 1997 through his book Critical Chain, one of the seminal tomes on the theory of constraints. He developed this method in response to his understanding that poor performance resulted in cost overruns, frequently missed deadlines and underdelivery of scope.

Goldratt theorized that traditional tools used to manage projects did not effectively address the counterproductive human behaviors that are incentivized by embedding safety time into task durations as a buffer between tasks. These time buffers tend to encourage project participants, also known as resources, to push project actions off until the last moment before a deadline, sometimes making it impossible to recover from a delay or problem. Similarly, these buffers—also known as project safety buffers—discourage project participants from reporting early delivery of tasks that could significantly shorten future deadlines. The result of these behaviors is that while delays are always passed on to affect the whole project, benefits from early task completions are rarely realized. Rather than expect the same results for project resources, regardless of project size and scope, Goldratt saw an opportunity to extend existing project management frameworks to capitalize on early task completion.

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