Bryan Green
2023-04-07
If you’ve been in the project management field for any length of time, you’ve probably encountered this trilemma. Sometimes called the Quality-Cost-Schedule triangle.
Quality
My first construction job was as a quality engineer for a large international design-builder. The job posting was Field Engineer, but my entire job for the first year was exclusively executing the company’s quality program. Which is to say, I filled out a lot of check lists, took a lot of photos, and filed a lot of paperwork.
It was not glamourous work, but I quickly began to see the value of a robust quality program. I saw quality as the most important part of construction. It didn’t matter how much it cost, or how long it took, quality engineers were the last line of defense in making sure the client got what they wanted. And that’s why we were here, after all.
Schedule
Around the one year mark of my career, I was put through an immersive 6-week scheduling course.
I found the process incredibly intriguing but I also had a lot of concerns about how modern scheduling was done (I’ll cover that in a future post). Shortly thereafter, I was assigned to a project as the lead scheduler, and it became clear that scheduling, not quality, was the most important part of construction.
Clients want to be done fast, so they can enjoy their new [insert built thing]. And that’s why they hired us, after all.
Cost
It was almost a year later that I saw an invoice for the first time (in a professional capacity. I’d obviously seen an invoice before then).
Sure, I’d been sent some accidentally by subcontractors, but the money was never my responsibility.
On my third project, I was put in charge of managing the fuel invoicing for all subcontractors on site.
I developed a spreadsheet to track the fuel usage by person-vehicle with a custom interface to output all the individual invoices just by selecting from a dropdown list. I felt pretty slick. In my first month, I discovered over $50k in previously unbilled fuel costs and sent it, excitedly, to my boss so he could reach out to our subs and collect. Damn, that felt good. Managing costs must be the most important part of construction. We were a business, after all.
Its actually surreal how much power I had to direct work without ever knowing what it cost. As a quality engineer, I helped approve requests for extra work. As a scheduler, I was developing schedule optimizations. Never did I consider what the cost was to the company, or the project. That was the project manager’s problem.
Now I’m a project manager and I realize how foolish I was. Moreover, I realize how foolish the concept of the trilemma is. It feels right, at first glance, but its so much more complex in practice.
So what’s the Quality-Cost-Schedule Trilemma?
The quality, cost, and schedule triangle/trilemma is a concept that is used in the field of construction (or any form of manufacturing and production) to describe the relationship between three key factors: the quality of a product, the cost of producing it, and the speed at which it can be produced.
The triangle illustrates that these three factors are interdependent, and that changes to one will have an impact on the others.
The logic goes like this:
The quality of a product is determined by its features, performance, and reliability, as well as its ability to meet customer needs and expectations. When the quality of a product is high, it is more likely to meet customer needs and to be in demand, but this usually comes at a higher cost. High quality products are usually more expensive to produce due to the cost of raw materials and the cost of skilled labor.
The highest quality project requires expensive materials and takes slow, meticulous production to complete.
The cost of producing a product is determined by the cost of the raw materials, the cost of labor, and the cost of equipment and facilities. When the cost of production is low, it makes the product more affordable for customers, but this may also lead to lower quality products. Lower cost products are usually made from cheaper materials, and produced at higher speed but less care.
The least expensive project is one where you use the cheapest materials and work as quickly as possible.
The speed at which a product can be produced is determined by the efficiency of the production process and the availability of resources. Faster production speeds can lead to lower costs, but it can also lead to lower quality products. When production speed is too high, the quality of the product may be compromised, leading to defects and customer dissatisfaction.
The fastest project means sacrificing quality for speed, and throwing money at the project to finish sooner.
These three factors form a triangle, representing that they are all interrelated, and that changes to one factor will have an impact on the others. It’s not possible to optimize all three factors simultaneously. We have to make trade-offs between the three, that is why it’s a “triangle” , to make sure that the product meets customer needs, is affordable, and can be produced quickly.
The common approach to this challenge is to create a balance between the three factors. For example, you might aim to produce products of acceptable quality that are moderately priced and can be produced at an acceptable speed.
But I think there’s another side the trilemma that is often misunderstood, and that’s the interconnectedness of them all.
Attempting to reduce cost, increase quality, or speed up a project can lead to counterproductive results. This is because changes to one aspect can have unintended consequences on the others. Here are some examples of how these efforts can backfire:
Reducing cost may end up costing more:
If you cut costs by using lower-quality materials or less skilled labor, you may face increased maintenance, repair, or replacement costs over the course of the project. Rework, replacement, and maintenance expenses offset any initial savings and ultimately lead to a higher total cost. Additionally, if cost-cutting measures lead to project delays due to any of the previous-listed reasons, the increased overhead costs could further erode any anticipated savings.
Increasing quality may reduce quality:
Ignoring for a second that the true goal of project quality is to meet or slightly exceed the client’s expectation (which I’ll cover in a future post), pursuing higher quality at all costs might lead to overengineering or the implementation of unnecessary features or processes. This can lead to unnecessary complexity. This increased complexity introduces new risks and makes the project more difficult to manage, ultimately resulting in a decrease in overall quality, especially if the more complex version fails to meet the client’s functionality requirements.
Speeding up a project may slow it down:
If you try to accelerate a project by adding more resources or multitasking, you may inadvertently create inefficiencies. This is known as Brooks’ Law, which states that “adding manpower to a late software project makes it later.” The same can be true for construction, where there is a practical limit to how many workers can be assigned to a task before reducing productivity. The increased communication and coordination efforts required to manage additional resources can slow down progress. Additionally, rushing a project can lead to mistakes or skipped steps, which may require rework, further delaying the project’s completion.
Is There No Way to Win?
To avoid these pitfalls, it is essential to carefully consider the trade-offs between cost, quality, and schedule when planning and executing a project. Project managers must be aware of the potential consequences of their decisions and continuously monitor project progress to ensure that any changes made are beneficial and do not lead to unintended negative outcomes.
And that’s all well and good, except its not practical advice. Its easy to say “just balance the three”, but what does that mean?
Here is my approach to a project management strategy that optimizes quality, cost, and schedule:
- Start with Quality
Of the three, quality will have the most lasting effect on a client. While the constructor’s cost and schedule may end at turnover (perhaps with some maintenance period), the client will continue servicing the project for its lifetime. This means continued cost and time invested in operations and maintenance. Your primary goal should be to develop a quality program that ensures the project meets the standards outlined by your client. If no such standards are provided, then industry standard at the very least. I’ll cover how to develop a quality program in a future post. But your quality metrics should be clear and binary. You should be able to estimate the cost of implementing your quality program as a fraction of each component - Build Your Schedule
While the speed of your project is dependent on your budget, there are physical limits on the order of activities. Connections in a schedule are often called logic or dependencies and they can be broken into two main types: physical dependencies (what I refer to as hard logic), and practical dependencies (soft logic).
Hard logic means you physically can’t do something without having completed the previous task. E.g. You can’t install windows until the wall is framed.
Soft logic means you can’t or wouldn’t do two things at the same to avoid conflicts. E.g. you probably wouldn’t paint the walls and install the windows at the same time.
While soft logic can be adjusted to increase speed, hard logic is often the limiting factor for your project. Develop your schedule’s hard logic and account for the time of quality. - Estimate Your Costs
Once you have your schedule, you can start estimating the cost of executing your schedule. The costs should include all the time, tools, and materials required to execute the activities to the level of quality defined in step 1.
By setting the minimum quality standard and incorporating it into your schedule, and then building your budget around the reasonable amount of time it takes to complete the schedule, you’ll know where on the triangle to set your baseline.
From there, you should look to incrementally increase the quality the project in ways that increase speed and reduce cost, systematically accelerate the project in ways that maintain quality and cost, and cut costs without slowing down the project or reducing quality.
Simple enough, right? Of course not. But that’s the job.
The quality, production, and cost triangle illustrates that these three factors are interdependent, and that changes to one will have an impact on the others. Finding a balance between these factors is essential for success in the field of manufacturing and production. Understanding this concept can help manufacturers and producers to make informed decisions about the products they create and how they’re produced, with the ultimate goal of satisfying customers and staying competitive in the market.
Cheers,
BG
