Lecture 4 Project Management Chapter 17
Project Management How is it different? Why is it used? Limited time frame Narrow focus, specific objectives Why is it used? Special needs Pressures for new or improves products or services
Project 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
Project Management What are the tools? Work breakdown structure Network diagram Gantt charts Risk management
Planning and Scheduling Gantt Chart Locate new facilities Interview staff Hire and train staff Select and order furniture Remodel and install phones Move in/startup MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Key Decisions 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
Project Manager Responsible for: Work Quality Human Resources Time Communications Costs
Ethical Issues Temptation to understate costs Withhold information Misleading status reports Falsifying records Compromising workers’ safety Approving substandard work
Project Life Cycle Concept Feasibility Planning Execution Termination Management
Work Breakdown Structure
PERT 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
The Network Diagram Network (precedence) diagram Activity-on-arrow (AOA) Activity-on-node (AON) Activities consume resources and/or time Events points in time
Project Network – Activity on Node Figure 17.4 1 2 3 5 6 Locate facilities Order furniture Furniture setup Interview Remodel Move in 4 Hire and train 7 S AON
The Network Diagram (cont’d) Path Sequence of activities that leads from the starting node to the finishing node AON path: S-1-2-6-7 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
Time Estimates Deterministic Probabilistic Time estimates that are fairly certain Probabilistic Estimates of times that allow for variation
Project Network – Activity on Node Figure 17.4 6 weeks 1 2 3 5 6 Locate facilities Order furniture Furniture setup Interview Remodel Move in 4 Hire and train 7 S 3 weeks 8 weeks AON 11 weeks 1 week 9 weeks 4 weeks
Management Scientist Solution Critical Path
Example 1: Activity on Arc (AOA) Representation Figure 17.5 6 weeks Deterministic time estimates 4 Order furniture 3 weeks 2 8 weeks Furniture setup Locate facilities Remodel Move in 11 weeks 1 5 6 1 week Interview Hire and train 4 weeks 9 weeks 3
Computing Algorithm Network activities Used to determine ES: early start EF: early finish LS: late start LF: late finish Used to determine Expected project duration Slack time Critical path
Advantages of PERT Forces managers to organize Provides graphic display of activities Identifies Critical activities Slack activities 1 2 3 4 5 6
Limitations of PERT Important activities may be omitted Precedence relationships may not be correct Estimates may include a fudge factor May focus solely on critical path