![]() ![]() We study a project management problem where the prime contractor needs to outsource tasks to subcontractors with the required resources. We recognize that performance incentives are structured differently by each organization, but our work provides a flexible basis from which various practical schemes can be designed. The incentive schemes we propose are simple and easily implementable. We also provide what is apparently the first analytical comparison between traditional CPM and modern CCPM planning systems. A large-scale computational study validates the resulting benefit to project performance as substantial and also robust across different project characteristics. These schemes apply to projects designed under either traditional Critical Path Method (CPM) planning or modern Critical Chain Project Management (CCPM) planning, and are also invulnerable to group strategy. Our results include the design of incentive schemes that eliminate or mitigate Parkinson’s Law. ![]() ![]() From our review of the academic and business literature of project management, no incentive scheme used in practice accomplishes this. A particular issue in the design process is to eliminate the possibility that a project worker with multiple dependent tasks can improve their incentive payment by falsely reporting some of their task completion times. Our work uses mechanism design within non-cooperative game theory. Hence, project success rates below 40% are widely reported. ![]() As a consequence, the late completion of other work is not offset, and overall project performance suffers. This behavioural phenomenon routinely results in failure to deliver work that is completed early before its assigned deadline. Yet projects routinely suffer from the influence of Parkinson’s Law. Project management is a business process that supports about 30% of the world’s economic activity. ![]()
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