Teradyne Corporation: The Jaguar Project.

MSTM- 6034

MSTM- 6034

Project Management in the Offshore,

Project Management in the Offshore,

Health, Fisheries and

Health, Fisheries and Engineering

Engineering

Technolog En!ironments

Technolog En!ironments

Mod"le #$ Project Management F"ndamentals

Mod"le #$ Project Management F"ndamentals

Gino, F.

Gino, F. & Pisano, G., & Pisano, G., 2006: Te2006: Teradyne Corporation: The radyne Corporation: The JaguarJaguar  Project.

 Project.

S"%mitted % Tona Somerton S"%mitted % Tona Somerton

Tuesday

Tuesday, October 15, October 15, 2013, 2013

0 0

Ta%le of &ontents

Overview ……….………….………...……….. 2

Problem Statement ……….………...………… 4

lternatives ……….………...…………... 4

lternative nalysis ……….…….……… 5

!ourse o" ction ………..……….. # $e"erences ………..………..………. 10

O!er!ie'

&om(an$ Teradyne !or%oration

Em(loees$ Over &000

Fo"nded$ 1#&0 by le' ()rbelo"" and  *ic+ (eol". !lassmates "rom -T

)"siness$ Production o" e/ui%ment "or testin semiconductors

Sales$ 1. billion in 2004.

Mar*et$ orld)s larest su%%lier, orldwide+

e("tation$ nown "or reliability, test s%eed and tecnical %er"ormance

)"siness nits$

1 Semiconductor test,

2 ssembly Test, 3 6roadband Test, 4 !onnection Systems, 5 (ianostic Solutions.

&"lt"re$ 7nineerin, driven by

 %er"ormance. !asual dress, cubicle o""ice s%aces, encouraed individual initiative. 8on ours is te norm, recruitment 9 retention were no issue.

O(erating. (roject (rocesses in (lace (rior to the /ag"ar Project$

ntroduced in te 1##0)s: Total ;uality -anaement <T;-, $evolutioni=in %roduct develo%ment <$P(, 7nineerin Process m%rovement Team <7PT, reate Process  %lannin <PP, Pase:ate model, and >a"ter:action? review.

Sit"ation$

 6y 1##& it is clear tat T;- is not ta+in old in enineerin. Pro@ects continued

to be late and over budet. $P( was introduced alon wit 7PT, PP, Pase:ate 9 >"ter:action? review. *one were used consistently.

 Proress remained ily variable. Some divisions were still over committin and

tey continued to come u% wit unrealistic scedules.

 n 2001, to res%ond to a canin mar+et, Teradyne senior manaement made a

 %ivotal strateic decision. Te com%any decided to embrace te "le'ible %lat"orm stratey, abolisin te mar+et:sement "ocused %lat"orm, "oldin it into a sinle  %lat"orm enineerin rou%, %roducin a test system tat could test multi%le ty%es

o" devices. Tis %ro@ect rou% was code:named >Aauar?.

 Te %ro@ect was lead by a 25 year veteran o" Teradyne)s enineerin orani=ation,

Aac+ O) 6rien.

  critical taret date o" Aune 30t, 2004 was decided "or beinnin te si%ment o" 

te new tester.

 O)6rien %resented a B5 %ae %resentation to Senior -anaement in -ay o" 2002

detailin te system arcitecture, desin, and "unction s%eci"ications, taret  %er"ormance s%eci"ications and te %ro@ect e'ecution %lan.

 Te %ro@ect was orani=ed into a set o" %ro@ect teams, eac "ocused on a %articular 

subsystem tas+.  >core team? o" leaders "rom eac subsystem team as well as te  %roram manaer evin Ciebel and te %ro@ect lead O)6rien was "ormed. Tis

team met montly in %erson 9 wee+ly via telecon"erence to ensure a%%ro%riate levels o" interation across all sites.

 Dormali=ed %ro@ect manaement tools were used durin te Aauar %ro@ect. Tese

tools includedE or+ brea+down structure, 3:%oint estimation, critical %at analysis 9 earned value analysis.

 Te team was "le'ible and res%onded to delays by reallocatin resources, never

canin te "i'ed customer:si% date. Fardware remained aead o" scedule usin tese metrics.

 Some teams did not rely on te %ro@ect manaement tools metrics, so"tware)s

metrics indicated issues wit com%letin %lanned tas+s but, tey were >in denial? and constantly communicated tat tey could catc u%.

 n Se%tember o" 2003 Teradyne received word tat one o" te larest

semiconductor com%anies in te world, l%aTec was about to commit to a com%etitors system.

 Teradyne)s system was not sceduled to be ready "or evaluation until Aune, ten

monts later. Teradyne convinced l%aTec to wait "or tem to "inis teir  %roduct, to ive tem a cance to bid on te business. l%aTec ad one

conditionE tey wanted te system "or evaluation by -arc 30, 2004.

 dditional resources were committed to te So"tware team. s te deadline

closed in te so"tware team si"ted its e""ort to "i'in bus, avin to ma+e concessions on oriinally %lanned "eatures.

 On -arc 30t, 2004, as %romised te "irst com%lete system was si%%ed "or

evaluation. ll o" te ardware met s%eci"ications but, so"tware did not

incor%orate all "eatures initially re/uested by te customer. Te so"tware was "unctional but, was also laden wit bus. Teardyne s%ent te ne't si' monts

u%radin te system "or l%aTec. Teir wor+ %aid o"", in Se%tember 2004 l%aTec selected te Teradyne system.

 Tere was a cost to tis victory, te remainder o" te %ro@ect: includin

develo%ment o" "eatures "or oter customers: was delayed. So"tware teams were consumed wit "i'in bus and "ell "urter beind scedule by si' monts.

 n te >a"ter:action? review. ssues wit te a%%lication o" Pro@ect manaement

tools are identi"ied and tere are lessons to be learned "or "uture %ro@ect manaement at Teradyne. <Cino, D. 9 Pisano, C., 200&

Pro%lem Statement

n +ee%in wit Teradyne)s %rocess o" continuous im%rovement, O)6rien and te senior manaement are now beinnin te %rocess o" dissectin te %ro@ect to identi"y lessons learned. t was evident tat te %ro@ect did not meet customer s%eci"icationsE it was over budet and was beyond deadlines. Te team ad struled wit te use o" Pro@ect -anaement tools. ccordin to Pinto 2013, >te /uadru%le constraint is te standard o" %ro@ect success.?  %ro@ect is seen as success"ul i", te %ro@ect is on time, witin budet, meets te %ro@ects oal s%eci"ications, and is acce%table to te intended client. Gsin tis de"inition, te Aauar %ro@ect was not success"ul.

at went wron wit P- tool a%%lication in tis %ro@ect "or te outcome to be a  %ro@ect tat wasE over budet, o"" sco%e and beyond te e'%ected timelines and, wat can  be im%roved u%on to %revent similar occurrences in "uture %ro@ects at TeradyneH

lternati!es

 %ro@ect manaer is "aced wit a number o" res%onsibilities. mon tese res%onsibilities areE selectin a team, develo%in %ro@ect ob@ectives and a %lan "or e'ecution, %er"ormin ris+ manaement activities, cost estimatin and budetin, scedulin and manain resources.

" we ta+e tese res%onsibilities into consideration and analy=e  ow O)6rien

a%%roaced manain tem durin te Aauar Pro@ect, we are able to identi"y te %ro@ects strents, and evaluate wea+nesses to enance "uture %ro@ects.

lternatives to success"ully manae Teradyne %ro@ects revolve around te a%%lication o" "ormali=ed Pro@ect manaement tools. Tese tools include %rocesses traditionally used at Teradyne, as well as tose introduced "or s%eci"ically "or te Aauar %ro@ectI

1 Total ;uality -anaement 2 Pase:ated -odel

3 or+ brea+down structure, <6S 4 3:%oint estimation <P7$T 5 !ritical %at analysis, <!P & 7arned value analysis, <7J

naly=in eac tool a%%lied at Teradyne may reveal wat a%%ened durin te Aauar   %ro@ect and, o""er o%%ortunities to more e""ectively manae "uture %ro@ects at Teradyne.

lternati!e nalsis

lternati!e #$

Total ;uality -anaement

Pros &ons

 Provides em%loyee %roblem

solvin tecni/ues 9 tools.

 $educes lead time

 (ecreases %roduction de"ects  7liminates waste, reduces

 %roduction costs.

 denti"ies redundancies, addin

 %ro"it.

 m%roves %roductivity  m%roves morale

 $e/uires e'tensive em%loyee trainin  Productivity may be reduced durin

trainin.

 m%lementation ta+es em%loyees

away "rom duties.

 $e/uires cane in mindset, attitude

9 metods.

 $e/uires clear e""ective

communication oterwise "ear o" cane leads to resistance.

 Ta+es time, small incremental

im%rovements. <elcner, 2013

t Teradyne te enineers resisted T;- and "elt it was, >an encroacment on teir "reedom?. ne""ective communication and lac+ o" em%loyee education may ave  been a "actor leadin to te resistance and "ailure o" tis a%%roac.

-anaement ten "ocused on a %roduct develo%ment initiative, >revolutioni=in  %roduct develo%ment?. Te com%any)s %roblems were seen as "allin into two cateories.

Te "irst, was over commitment. Tis was addressed by te a%%lication o" reate Pro@ect Plannin <PP wic would see te com%anyE only ta+in on %ro@ects tat were

alined wit teir strateic %lan andE only committin to %ro@ects wen ade/uate and a%%ro%riate resources were available. Te second cateory was %oor %ro@ect %lannin. Coals and sco%e were not clearly de"ined, %ro@ects tended to e'%and, and became delayed. -ilestones were not well de"ined and were o"ten missed. Scedules ad little rior as tey were not trac+ed and manaement could not tell wen tey needed to intervene. Tere was no one individual res%onsible "or a iven %ro@ect. Tese concerns were addressed by im%lementin a %ase:ate model.

lternati!e 1$

Pros &ons

 ccelerated %roduct develo%ment  6rea+s down com%le' %rocesses  Provides overview enablin

 %rioriti=ation and "ocus

 !ross "unctional, involves

em%loyees

 !an be combined wit %er"ormance

metrics.

 Te a%%roac is se/uential. 7'%erts

 believe %roduct develo%ment sould be %arallel.

 (oes not su%%ort creation o" new

ideas.

 Tension e'ists between orani=in

and creativity. <!oo%er, 2013

Te intent o" te %ase:ate model at Terdyne was to %rovide well de"ined milestones and review %oints "or %ro@ects. Fowever, Teradyne >did not mandate te use o" any s%eci"ic tools and le"t it u% to individual divisions and manaers to decide wic recommendations to "ollow? <Cino 9 Pisano, 200&. ile some divisions embraced te a%%roac oters inored it. Proress varied, and "rustration rew. Tere was very little  beavioral cane, %ro@ects were still overcommitted and unrealistically sceduled. 

strict aderence to te use o" tese toolsK models would ave decreased te scedulin 9 resource issues witin te com%any. O)6rien attem%ted to address scedulin, budetin and de"inition o" res%onsibilities wit te additional tools "or te Aauar %ro@ectI 6S, 3:%oint estimation, !P 9 7J.

lternati!e 3$

or+ brea+down structure

d!antages of a good 2)S angers of a (oor 2)S  Dorces te team to create detailed

ste%s

 Te timeline may be loner   6udet may be mismanaed

 lays te roundwor+ "or scedule

and budet

 !reates em%loyee accountability.  !reation breeds em%loyee

enaement.

 ssinments o" team members may

not be clear 

 7m%loyees are not as li+ely to be

enaed in te wor+ because tey are not accountable "or outcomes. <7eland, 2011

lternati!e 4$

Pros &ons

 Provides boundaries on

e'%ectations around time and costs

 6est used in uni/ue %ro@ects were

tere are many un+nowns.

 Ta+es a lot o" wor+, re/uires 3

estimates.

 Still utili=es estimations, actual may

 be muc better or worse. <Product 9 %rocess innovation, 2012

lternati!e $

Pros &ons

 !an calculate e'actly ow lon a

 %ro@ect will ta+e.

 Provides ability to tell customers

com%letion timelines.

 denti"ies wic activities are time

critical.

 Provides o%%ortunity to create slac+ 

time reducin %rocessin at critical  %oints to titen u% turn around.

 6ased u%on ideal situations, does

not ta+e into account un"oreseen events.

 Timelines may be s+ewed i" tins

o wron.

 $elies on %ast data to "ormulate

com%letion time %redictions: di""icult "or new com%anies.

 Docuses %rimarily on time, nelects

/uality and cost control. <nram, 2013

lternati!e 6$

Pros &ons

 Gses /uantitative metrics to

evaluate %ast %ro@ect %er"ormance.

 Predicts "uture %er"ormance

e'tra%olatin "rom te %ast.

 7ncouraes ta+in corrective action

in res%onse to analysis results.

 $elies on assum%tion tat "uture can

 be %redicted "rom %ast %er"ormance.

 Tere is no uarantee tat te 7J

will be true.

<Fillson, 2004

O)6rien)s "ormation o" a sinle team was a sini"icant cane. Tese canes were more tan %rocess canes tey re/uired canes to core cultural values. Te

cane "rom wor+in inde%endently to becomin a %art o" a larer re%ortin structure tat ma+es cross "unctional decisions was "orein and removed %revious autonomy.

Teradyne did use a 6S durin te @auar %ro@ect. O)6rien)s B5 %ae %resentation laid te roundwor+ "or scedule, budet, and em%loyee accountability. Tis was an element tat ad not been underta+en at Teradyne. Coals, sco%e, and milestones ad never been clearly de"ined be"ore. Peo%le resisted te tools because tey "orced tem to commit. $e"usin to commit was a %art o" te reason wy te so"tware team ot critically  beind scedule.

Te tools %roduced metrics, advisin teams o" were tey were in te %ro@ect timeline oweverE te >red "las? were essentially inored by some teams, te so"tware team es%ecially. Tis scedulin issue meant te team ad to ma+e concessions to meet deadlines. Oriinal customer re/uested "eatures were cut to save time canin te sco%e o" te %ro@ect.

7m%loyee enaement and buy:in was low. Te tools were new and some em%loyees "elt tey were more cumbersome tan use"ul. Te "eelin at Teradyne was tat, sometimes te tools ot in te way. Jaluable time was s%ent deci%erin tool metrics and weter tey were reliable rater tan res%ondin to tem.  riid %redetermined scedule became less meanin"ul over time. Tey wor+ed to stay on scedule but, missed tat tey were ma+in concessions and canin te %ro@ect deliverables.

Te metrics tat were inored by manaement reardin te so"tware delays may ave been avoided i" additional resources were added as soon as tey noticed te timeline sli%%in. en te scedule was even "urter sortened tis %ut enormous %ressure on so"tware team and te end result was a %roduct tat was not as s%eci"ied initially.

t was te tools tat allowed te com%any to res%ond to l%aTec and teir use made tem con"ident tey could meet te milestones. Fowever, te @auar %ro@ect

inored /uality, and cost control wen %laced under %ressure to meet te deadlines, one o" te identi"ied disadvantaes o" te !P.

&o"rse of ction

 lot o" lessons were learned "rom te Aauar %ro@ect. Dirst, %ro@ect manaement

tools are valuable to success"ul %ro@ects oweverE te %eo%le usin tese tools must understand te sini"icance o" te tools and ow to utili=e tem to teir advantae.

Trainin sta"" to understand and e""ectively use te %ro@ect manaement tools would ave seen a res%onse to metrics, and may ave %ossibly avoided te so"tware catastro%e. Second, tools tat are bein used must be su%%orted and encouraed by manaement. Favin some teams use te tools, and oters not, breeds con"usion and inability to s%ea+ te same lanuae wen re%ortin oals and %roress.

Te ability to be "le'ible and to mitiate ris+ is essential to %ro@ect manaement. ll o" te tools used in te @auar %ro@ect were ood, valuable tools but teir e""ective a%%lication was lac+in due to ine""ective communication trouout te %ro@ect. >Tools ma+e tins better i" %eo%le usin tem acce%t and understand wat tey are "or and ow tey wor+? <6rown, 2004. Tis was not te case "or tose im%lemented at Teradyne

Tere was very little discussion o" ris+ manaement %lannin. Gtili=in ris+ scorin analysis and ris+ mitiation strateies can assist teams to deal wit un+nowns. $is+ manaement %re%ares teams to identi"y, analy=e, mitiate and control ris+.

Te T;- conce%t too+ te better %art o" "ive years to be incor%orated in most as%ects o" wor+ at Teradyne. Te Aauar introduced canes in %ro@ect manaement metodoloy tat would ave been better im%lemented, ad Teradyne s%ent time u%"ront to cane te orani=ational culture. Tese were sini"icant %ro@ect manaement canes. Time to understand, embrace and embed tem into daily o%erations was re/uired.

"  were O)6rien,  would continue to use all o" te identi"ied tools to

success"ully manae %ro@ects. Tey eac ave strents i" a%%lied correctly.  would a%%ly te lessons learned to "uture %ro@ects at Teradyne. Providin com%anywide education and trainin in an e""ort to cane te culture to include em%loyee level res%onsibility, understandin and accountability is essential. Teradyne ad reat %eo%le, ily educated and ca%able o" deliverin but, tey sim%ly did not buy:in to te %rocesses tat O)6rien was attem%tin to use. Drustration and decreased enaement lead to delay, overs%endin, and a less tan ade/uate %roduct at %ro@ect end.

!oo%er, $. <2013 -anain Product (evelo%ment. 7'%lanation o" te Stae:ate model o" $obert C. !oo%er. <) in 12anage: The e!ecuti"e #ast trac$. $etrieved "rom tt%IKKwww.12manae.comKmetodsLcoo%erLstae:ate.tml

7eland, 6. <2011, Debruary 22 6ene"its o" te or+ 6rea+down Structure. n  Project anage%ent Tips. $etrieved "rom tt%IKK%mti%s.netKbene"its:wor+:brea+down:

structureK

Fillson, (. <2004. 7arned Jalue and $is+ -anaementI  Practical Synery. n  is$ 'octor. $etrieved "rom tt%IKKwww.ris+:doctor.comK%d":"ilesKcev:b1004.%d" 

nram, (. <2013 !P- 9 P7$T ea+nesses 9 Strents. n (%a)) *usiness  'e%and edia. $etrieved "rom tt%IKKsmallbusiness.cron.comKc%m:%ert:wea+nesses:

strents:102.tml

elcner, 8. <2013 dvantaes 9 (isadvantaes o" Total ;uality -anaement Strateies. n (%a)) *usiness 'e%and edia. $etrieved "rom

tt%IKKsmallbusiness.cron.comKadvantaes:disadvantaes:total:/uality:manaement: strateies:221&0.tml

Pinto, A.. <2013. Project anage%ent: +chie"ing Co%petiti"e +d"antage. Toronto, O*I Pearson 7ducation nc.

Product 9 Process nnovation nc. <2012 Pro@ect -anaement 7stimatin Tools 9 Tecni/ues. n Process anage%ent Guru. $etrieved "rom

tt%IKKwww.%ro@ectmanaementuru.comKestimatin.tml