Provide the Definitions of Critical Path and Critical Chain

Critical path and critical chain are both schedule network analysis techniques. Critical path is the one that determines the shortest time to complete a project, which assumes low uncertainty and does not consider resource dependencies. Critical chain is a modified or refined technique about critical path; it involves the deterministic and probabilistic approaches to analyze the project schedule, which is more realistic and practical than critical path.

Differences between critical path and critical chain:

• Critical path is based on deterministic task duration, while critical chain involves the deterministic and probabilistic approaches;
• Critical path does not consider resource dependencies, while critical chain is based on resource constraints;
• Critical path does use buffer time efficiently, while critical chain uses optimum buffer time to reduce the risk of schedule;
• Critical path is less focused on non critical tasks that may cause risk, while critical chain controls risks more efficiently by considering more tasks and applying optimum buffer time.
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What are Inventory Buffers Analogous to in Project Management?

List various kinds of buffers used to manage projects and describe where each of them should be located.

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Inventory buffers are analogous to, in project management, time buffers.

Types of buffers used to manage projects are as below.

Resource buffers (RB): buffers that is located along with the critical path and specifically ahead of a task involving important resources. The purpose of Resource buffers is to make sure that the involved resources such as materials, machinery, and labor resources are available for the task, before the task is launching or during the process of the task.

Project buffers (PB): buffers that are amount of times located at the end of a project or, say, at the end of a critical path. It is made up of all the safety time derived from each step in critical path.

Feeding buffers (FB): buffers that are amount of buffer time at the end of non-critical tasks. This buffers help reduce the risk of non-critical tasks. They are located at the end of each non-critical task. 3.Describe common practices to estimate the duration of project activities as well as real reasons that cause project delays.

Common practices to estimate the duration of project activities:

• Down to Top: When asked about the time it takes to complete a task or activity in a whole project, each owner of the activity tends to add his safety time to the reported number; therefore, the project manager collects all the numbers from each owner and then adds his safety time to the overall duration of the project, say, the total time to complete the project. The finalized total time is more exaggerated.
• Top to Down: When given the total time by project manager, higher level managers tend to squeeze the time to reduce the time and cost. Therefore, lower level manager has to give up the initial schedule to satisfy higher level managers. The finalized time depends on the complexity of the organization: the more layers, the less time to complete a project.

Real reasons that causes project delays:

• Resource constraint: If a resource is shared by many projects or activities, it would be used in order of priority, thus leading to delay of
  activity or project with lower priority.
• Dependency: If two activities are serial relationship, which means one relies on the completion of another, the delay of the previous one would affect the start time of the later one, thus amounting to accumulated delay.

Provide an explanation of the pitfalls, as discussed in The Critical Chain, of using traditional cost accounting to manage project costs and project investments.

• Traditional accounting method requires cost saving for each department, leading to poor coordination as a whole to reduce cost due to neglect of throughput.
• Traditional accounting uses payback period method to measure the investment, which neglects the shortage of payback period- the payback period does not consider the time value of the investment. An investment with same payback period may vary in returns due to different in and out cash flows in different periods.