17-1Project Management CHAPTER 17 Project Management.
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Transcript of 17-1Project Management CHAPTER 17 Project Management.
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17-1 Project Management
CHAPTER17
Project Management
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17-2 Project Management
Unique, one-time operations designed to accomplish Unique, one-time operations designed to accomplish a specific set of objectives in a limited time frame.a specific set of objectives in a limited time frame.
Build A
A Done
Build B
B Done
Build C
C Done
Build D
Ship
JAN FEB MAR APR MAY JUN
On time!
ProjectsProjects
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17-3 Project Management
Project ManagementProject Management
How is it different? Limited time frame Narrow focus, specific objectives Less bureaucratic
Why is it used? Special needs Pressures for new or improves products or
services
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17-4 Project Management
Project ManagementProject Management
What are the Key Metrics Time Cost Performance objectives
What are the Key Success Factors? Top-down commitment Having a capable project manager Having time to plan Careful tracking and control Good communications
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17-5 Project Management
Project ManagementProject Management
What are the Major Administrative Issues? Executive responsibilities
Project selection Project manager selection Organizational structure
Organizational alternatives Manage within functional unit Assign a coordinator Use a matrix organization with a project leader
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17-6 Project Management
Project ManagementProject Management
What are the tools? Work breakdown structure Network diagram Gantt charts Risk management
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17-7 Project Management
Planning and SchedulingPlanning and Scheduling
MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Locate new facilities
Interview staff
Hire and train staff
Select and order furniture
Remodel and install phones
Move in/startup
Gantt Chart
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17-8 Project Management
Deciding which projects to implement
Selecting a project manager
Selecting a project team
Planning and designing the project
Managing and controlling project resources
Deciding if and when a project should be terminated
Key DecisionsKey Decisions
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17-9 Project Management
Project ManagerProject Manager
Responsible for:
Work QualityHuman Resources TimeCommunications Costs
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17-10 Project Management
Temptation to understate costs
Withhold information
Misleading status reports
Falsifying records
Comprising workers’ safety
Approving substandard work
Ethical IssuesEthical Issues
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17-11 Project Management
Project Life CycleProject Life Cycle
Concept
FeasibilityFeasibility
PlanningPlanning
ExecutionExecution
TerminationTermination
Man
agem
ent
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17-12 Project Management
Work Breakdown StructureWork Breakdown Structure
Project XProject X
Level 1
Level 2
Level 3
Level 4
Figure 17.2
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17-13 Project Management
PERT and CPMPERT and CPM
PERT: Program Evaluation and Review Technique
CPM: Critical Path Method
Graphically displays project activities Estimates how long the project will take Indicates most critical activities Show where delays will not affect project
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17-14 Project Management
The Network DiagramThe Network Diagram
Network (precedence) diagram
Activity-on-arrow (AOA)
Activity-on-node (AON)
Activities
Events
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17-15 Project Management
The Network Diagram (cont’d)The Network Diagram (cont’d)
Path Sequence of activities that leads from the starting
node to the finishing node Critical path
The longest path; determines expected project duration
Critical activities Activities on the critical path
Slack Allowable slippage for path; the difference the
length of path and the length of critical path
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17-16 Project Management
Project Network – Activity on ArrowProject Network – Activity on Arrow
1
2
3
4
5 6
Locatefacilities
Orderfurniture
Furnituresetup
InterviewHire andtrain
Remodel
Move in
Figure 17.4
AOA
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17-17 Project Management
Project Network – Activity on NodeProject Network – Activity on Node
1
2
3
5
6
Locatefacilities
Orderfurniture
Furnituresetup
Interview
RemodelMove in
4
Hire andtrain
7S
Figure 17.4
AON
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17-18 Project Management
Network ConventionsNetwork Conventions
a
b
c ab
c
a
b
c
d
a
b
c
Dummyactivity
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17-19 Project Management
Time EstimatesTime Estimates
Deterministic
Time estimates that are fairly certain
Probabilistic
Estimates of times that allow for variation
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17-20 Project Management
Example 1Example 1
1
2
3
4
5 6
8 weeks
6 weeks
3 weeks
4 weeks9 weeks
11 weeks
1 week
Locate
facilities
Order
furniture Fu
rnitu
re
setup
InterviewHire
and train
Remodel Move in
DeterministicDeterministictime estimatestime estimates
Figure 17.5
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17-21 Project Management
Example 1 SolutionExample 1 Solution
P a t h L e n g t h( w e e k s )
S l a c k
1 - 2 - 3 - 4 - 5 - 61 - 2 - 5 - 61 - 3 - 5 - 6
1 82 01 4
206
Critical PathCritical Path
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17-22 Project Management
Network activities ES: early start EF: early finish LS: late start LF: late finish
Used to determine Expected project duration Slack time Critical path
Computing AlgorithmComputing Algorithm
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17-23 Project Management
Probabilistic Time EstimatesProbabilistic Time Estimates
Optimistic time
Time required under optimal conditions
Pessimistic time
Time required under worst conditions
Most likely time
Most probable length of time that will be required
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17-24 Project Management
Probabilistic EstimatesProbabilistic Estimates
Activitystart
Optimistictime
Most likelytime (mode)
Pessimistictime
to tptm te
Figure 17.8
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17-25 Project Management
Expected TimeExpected Time
te = to + 4tm +tp
6
te = expected timeto = optimistic timetm = most likely timetp = pessimistic time
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17-26 Project Management
VarianceVariance
(tp – to)2
36
= varianceto = optimistic timetp = pessimistic time
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17-27 Project Management
Example 5Example 5
1-3-4a
3-4-5d
3-5-7e
5-7-9f
2-4-6b
4-6-8h
2-3-6g 3-4-6
i
2-3-5c
Optimistictime
Most likelytime
Pessimistictime
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17-28 Project Management
Path ProbabilitiesPath Probabilities
Z = Specified time – Path meanPath standard deviation
Z indicates how many standard deviationsof the path distribution the specified tineis beyond the expected path duration.
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17-29 Project Management
17Weeks
Weeks
Weeks
Weeks
10.0
16.0
13.5
1.00
1.00
a-b-c
d-e-f
g-h-i
Example 6Example 6
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17-30 Project Management
Time-cost Trade-offs: CrashingTime-cost Trade-offs: Crashing
Crash – shortening activity duration
Procedure for crashing
Crash the project one period at a time
Only an activity on the critical path
Crash the least expensive activity
Multiple critical paths: find the sum of crashing the least expensive activity on each critical path
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17-31 Project Management
Time-Cost Trade-Offs: CrashingTime-Cost Trade-Offs: Crashing
TotalcostTotalcost
ShortenShorten
ShortenShorten
Cumulativecost of crashing
Cumulativecost of crashing
Expected indirect costsExpected indirect costs
Optimum
CRASHCRASH
Figure 17.11
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17-32 Project Management
6a
4d
5c
10b
9 e
2f
Example 7Example 7
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17-33 Project Management
Advantages of PERTAdvantages of PERT
Forces managers to organize
Provides graphic display of activities
Identifies
Critical activities
Slack activities1
2
3
4
5 6
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17-34 Project Management
Limitations of PERTLimitations of PERT
Important activities may be omitted
Precedence relationships may not be correct
Estimates may include a fudge factor
May focus solelyon critical path 1
2
3
4
5 6
142 weeks
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17-35 Project Management
Computer aided design (CAD) Groupware (Lotus Notes) Project management software
CA Super Project Harvard Total Manager MS Project Sure Track Project Manager Time Line
Technology for Managing ProjectsTechnology for Managing Projects
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17-36 Project Management
Imposes a methodology
Provides logical planning structure
Enhances team communication
Flag constraint violations
Automatic report formats
Multiple levels of reports
Enables what-if scenarios
Generates various chart types
Advantages of PM SoftwareAdvantages of PM Software
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17-37 Project Management
Risk: occurrence of events that have undesirable consequences
Delays
Increased costs
Inability to meet specifications
Project termination
Project Risk ManagementProject Risk Management
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17-38 Project Management
Identify potential risks
Analyze and assess risks
Work to minimize occurrence of risk
Establish contingency plans
Risk ManagementRisk Management
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17-39 Project Management
SummarySummary
Projects are a unique set of activities
Projects go through life cycles
PERT and CPM are two common techniques
Network diagrams
Project management software available
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17-40 Project Management
Projects — ConceptsProjects — Concepts
PM1Definition/Example Alton Bridge