PROJECT MANAGEMENT Outline What is project mean? Examples of projects… Project Planning and Control Project Life Cycle Gantt Chart PERT/CPM

What is Project? What is the different between normal business activities and Project? Project Unique, one time operations design to accomplish a specific set of objectives in a limited time frame.

Examples of project… 1. Building a house 2. Building a factory 3. Add assembly line in the factory 4. Merging to companies 5. Managing political campaign 6. Designing a new product 7. Soft ware development

Project Management u Project – Lengthy network of activities needed to complete a major output. u Project Management – Planning, execution, and controlling resources to needed to complete the project.

Project Life Cycle u Definition u Why we need to start new project u Feasibility Analysis (Cost, Benefit, risk of under taking a project) u Planning u Details of the work, estimates time, Human resource and cost u Execution u During which a project itself is done u Termination u During which closer is achieved

Project Planning, Controlling and Scheduling Project Planning: »1. Setting goals. »2. Defining the project. »3. Tying needs into timed project activities. »4. Organizing the team. Before Project

Project Planning, Controlling and Scheduling u Project Scheduling: »1. Tying resources to specific activities. »2. Relating activities to each other. »3. Updating and revising on regular basis.

Project Planning, Controlling and Scheduling u Project Controlling: »1. Monitoring resources, costs, quality and budgets. »2. Revising and changing plans. »3. Shifting resources to meet demands. During Project

Work Breakdown Structure Program Project 1Project 2 Task 1.1 Subtask Work Package Level Task 1.2 Subtask Work Package

u How is it different? –Limited time frame –Narrow focus, specific objectives –Less bureaucratic u Why is it used? –Special needs –Pressures for new or improves products or services

u What are the Key Metrics –Time –Cost –Performance objectives u What are the Key Success Factors? –Top-down commitment –Having a capable project manager –Having time to plan –Careful tracking and control –Good communications

u 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

u What are the tools? –Work breakdown structure –Network diagram –Gantt charts –Risk management

Key Decisions u Deciding which projects to implement u Selecting a project manager u Selecting a project team u Planning and designing the project u Managing and controlling project resources u Deciding if and when a project should be terminated

Project Control: Gantt Chart u The Gantt chart is a popular tool for planning and scheduling simple project. u It enables a manager to initially schedule project activities and then to monitor progress over time by comparing planned progress to actual progress

Project Manager Responsibility WorkQuality Human ResourcesTime CommunicationsCosts

Ethical Issues u Temptation to understate costs u Withhold information u Misleading status reports u Falsifying records u Comprising workers’ safety u Approving substandard work

Project Life Cycle Concept Feasibility Planning Execution Termination Management

Project Control: Gantt Chart Activity 1 Activity 2 Activity 3 Activity 4 Activity 5 Activity 6 Time a b a b c c d d d

PERT and CPM u PERT (program evaluation and review technique) » U.S. Navy Special Projects Office (1958) » Polaris missile project u CPM (critical path method) » J. E. Kelly of Remington-Rand and M. R. Walker of Du Pont (1957) » Scheduling maintenance shutdowns of chemical processing plants

Questions answered by PERT/CPM 1. When will the entire project be completed? 2. What are the critical activities or tasks in the project, that is, the ones that will delay the entire project if they are late? 3. Which are the non-critical activities, that is, the ones that can run late without delaying the entire project’s completion? 4. What is the probability that the project will be completed by a specific date?

Questions answered by PERT/CPM 5. At any particular date, is the project on schedule, behind schedule, or ahead of schedule? 6. On any given date, is the money spent equal to, less than, or greater than the budgeted amount? 7. Are there enough resources available to finish the project on time? 8. If the project is to be finished in a shorter amount of time, what is the best way to accomplish this at the least cost?

To Find Critical Path ??? To find the critical path, need to determine the following quantities for each activity in the network: 1. Earliest start time (ES): the earliest time an activity can begin without violation of immediate predecessor requirements. 2. Earliest finish time (EF): the earliest time at which an activity can end. 3. Latest start time (LS): the latest time an activity can begin without delaying the entire project. 4. Latest finish time (LF): the latest time an activity can end without delaying the entire project.

CPM with Single Time Estimate Consider the following consulting project: Develop a critical path diagram and determine the duration of the critical path and slack times for all activities ActivityDesignationImmed. Pred.Time (Weeks) Assess customer's needsANone2 Write and submit proposalBA1 Obtain approvalCB1 Develop service vision and goalsDC2 Train employeesEC5 Quality improvement pilot groupsFD, E5 Write assessment reportGF1

When I can start depends on when predecessors finish. A, 2B, 1 C, 1 D, 2 E, 5 F, 5 G, 1

Don’t delay the project ES=9 EF=14 ES=14 EF=15 ES=0 EF=2 ES=2 EF=3 ES=3 EF=4 ES=4 EF=9 ES=4 EF=6 A, 2B, 1 C, 1 D, 2 E, 5 F, 5 G, 1 LS=14 LF=15 LS=9 LF=14 LS=4 LF=9 LS=7 LF=9 LS=3 LF=4 LS=2 LF=3 LS=0 LF=2

Critical Path & Slack ES=9 EF=14 ES=14 EF=15 ES=0 EF=2 ES=2 EF=3 ES=3 EF=4 ES=4 EF=9 ES=4 EF=6 A, 2B, 1 C, 1 D, 2 E, 5 F, 5 G, 1 LS=14 LF=15 LS=9 LF=14 LS=4 LF=9 LS=7 LF=9 LS=3 LF=4 LS=2 LF=3 LS=0 LF=2 Duration = 15 weeks Slack=(7-4)=(9-6)= 3 Wks

CPM with Three Activity Time Estimates

Expected Times

PERT/ CPM u CPM uses two sets of time and cost estimates for activities: »A normal time and cost and »A crash time and cost  The normal cost is an estimate of cost to complete an activity in normal time.  The crash time is the shortest possible activity time.  Crash cost is the cost of completing the activity on a crash or deadline basis.

Project Crashing with PERT/CPM: Four Steps 1. Find the normal critical path and identify the critical activities. 2. Compute the crash cost per week (or other time period) for all activities in the network. This process uses the following formula: crash cost/time period = crash cost – normal cost normal time – crash time

Project Crashing with PERT/CPM: Four Steps 3. Select the activity on the critical path with the smallest crash cost per week. Crash this activity to the maximum extent possible or to the point at which your desired deadline has been reached 4. Check to be sure that the critical path you were crashing is still critical. –Often, a reduction in activity time along the critical path causes a non-critical path or paths to become critical. »If the critical path is still the longest path through the network, return to step 3. »If not, find the new critical path and return to step 2.

Subproject  For extremely large projects, an activity may be made of several smaller sub-activities.  Each activity might be viewed as a smaller project or a subproject of the original project.  The person in charge of the activity might wish to create a PERT/CPM chart for managing this subproject.  Many software packages have the ability to include several levels of subprojects