CHAPTER 4 MANAGING PROJECT PROCESSES

THE CONCEPT A project is an interrelated set of activities that has a definite starting and ending point and that results in a unique outcome for a specific allocation of resources Consisting of three major activities : defining & organizing, planning, monitoring & controlling

DEFINING AND ORGANIZING PROJECT Selecting the project manager and team : organizational structure (functional, pure, matrix), control and efficiency Defining the scope and objectives : scope, time frame and allocated resources Planning the project format : guidelines for meetings, resolving issues, communication

PLANNING PROJECTS Defining the work breakdown structure : activity, ownership and procedure Diagramming the network - PERT/CPM :  identifying and organizing the data and the interrelationship between activities  estimating the completion time of the project  highlighting the crucial activities to completing projects on schedule  analyzing the time & cost implications of resources trade-offs

Developing the schedule :  the critical path is the sequence of activities between a project’s start and finish that takes the longest time to complete  activity slack is the maximum length of time that an activity can be delayed without delaying the entire project (latest start - earliest start time or latest finish - earliest finish time)  free slack = earliest start time of the next activities - earliest finish time of the current activities

 the earliest finish time = earliest start time + t  the earliest start time is the earliest finish time of the preceding activity or the latest of the earliest finish time of the preceding activites  the latest start time = the latest finish time - t  the latest finish time is the latest start time of the activity immediately following it or the earliest of the latest start time of the subsequent activities

Analyzing cost-time trade-offs : keeping cost at acceptable level as important as meeting schedule dates  total project cost = (direct + indirect + penalty) costs  crashing or expediting by shorten individual activities (by increasing its direct costs) to reduce overall project completion time and consequently its (indirect) costs, gain additional revenues and to avoid penalty costs  cost to crash per week = (CC-NC)/(NT-CT)  minimizing cost

Assessing risk  the notion of uncertainty relates to project timing and costs, such as weather, labor shortages, supply delays etc  incorporating uncertainty into the network model by using computer simulation or statistical analysis  computer simulation : choosing activity times of critical path from probability distribution randomly which will result in a probability distribution of completing dates

 statistical analysis approach : optimistic, most likely and pessimistic time derived from a beta probability distribution to calculate the expected time and variance  activity duration times are independent random variables which approach normal distribution as the number of random variables increases  the sum of (earliest) expected times and variances of the critical path

MONITORING AND CONTROLLING PROJECT Monitoring project status :  Open issues and risks  Schedule status : negative slack and crashing Monitoring project resources :  resources leveling  resources allocation  resources acquisition