1. Project Planning & Scheduling

2. 14-2 What is a “project”? Objectives and tradeoffs Planning and Control in Projects Scheduling Methods Constant-Time Networks PERT Method CPM Method Use of Project Management Concepts

3. 14-3 What is a “Project”? Unique item - often a single unit. Often located on one place. The unit does not move during production. Resources are brought to the project. May be of any size, although we focus on large projects.

4. 14-4 Examples of Projects Building construction Bridge construction Build aircraft carrier R&D project New product introduction Open or close a facility Software installation

5. 14-5 Objectives and Tradeoffs Meet the specifications Stay within the budget

6. 14-6 Project Management Stages Planning Scheduling Execution Control

7. 14-7 Planning Activities & Decisions Identify the project customer Establish the end product or service Set project objectives Estimate total resources and time required Decide on the form of project organization Make key personnel appointments Define major tasks required Establish a budget

8. 14-8 Scheduling Activities & Decisions Develop a detailed work-breakdown structure Estimated time required for each task Sequence tasks in proper order Develop a start/stop time for each task Develop detailed budget for each task Assign people to tasks

9. 14-9 Execution & Control Monitor actual time, cost, and performance Compare planned to actual figures Determine whether corrective action is needed Evaluate alternative corrective actions Take appropriate corrective actions

10. 14-10 Execution and Control What are ‘corrective actions?’ When one or more activities threaten the time, cost, or performance of the project, a corrective action is necessary: Redefine the activity (e.g. split the activity). Add resources to the activity. Shift resources from one activity to another  Resources = people, equipment, money

11. 14-11 Scheduling Methods Gantt Charts –Shown as a bar charts –Do not show precedence relations –Visual & easy to understand Network Methods –Shown as a graphs or networks –Show precedence relations –More complex, difficult to understand and costly than Gantt charts

12. 14-12 Gantt Chart Project Example (Figure 14.1) Week No.12345678 1Lease the site 2Hire the workers 3 Arrange for the Furnishings 4Install the furnishings 5Arrange for the phones 6Install the phones 7Move into the Office

13. 14-13 Constant-Time Networks Activity times are assumed to be constant Activities are represented by nodes in the network Arrows show the precedence relationships Notations used in calculating start and finish times: –ES(a) =Early Start of activity a –EF(a) =Early Finish of activity a –LS(a) =Late Start of activity a –LF(a) =Late Finish of activity a

14. 14-14 ‘Write a Business Report’ Table 14.3 ImmediateDuration ActivityDescriptionPredecessorsDays ADecide on TopicNone1 BCollect DataA2 CSearch the InternetA3 DWrite the ReportB and C5

15. 14-15 Network Diagram for ‘Write a Business Plan’ (Figure 14.2) A B D C

16. 14-16 Forward Pass for ‘Write a Business Plan’ (Figure 14.3) A B D C 0 1 1 3 4 9 1 4 ES EF

17. 14-17 Calculating ES, EF, LS, LF, and Completion Time ES (a) = 0 for the starting activity EF (a) = ES (a) + t (a)* ES (a) = max [EF (all predecessors of a)] Project completion time = max [EF(all ending activities)] * t (a) denotes the duration of activity a LF (a) = min [LS (all successors of a)] LS (a) = LF - t(a)* Forward Pass: Backward pass:

18. 14-18 Backward Pass for ‘Write a Business Plan’ (Figure 14.4) A B D C 0 1 1 3 4 9 1 4 ES EF LS LF 0 1 2 4 4 9 1 4

19. 14-19 Critical Path Critical Path = longest path in the network –All activities for which ES=LS and EF=LF –Length of critical path is equal to the project completion time –If there is any delay on the critical path, the project will be delayed (unless one takes ‘corrective actions’) –Critical path in example is A-C-D

20. 14-20 Slack Times Slack time equals amount of time a path may be delayed without delaying the project –Paths not on the critical path have slack –Slack = LS-ES or LF-EF

21. 14-21 Precedence and times for Opening a New Office (Table 14.4) ImmediateActivityComputed ActivityDescriptionPredecessorsTimeSlack 1Lease the siteNone10 2Hire the workers150 3Arrange for the Furnishings111 4Install the furnishings321 5Arrange for the phones113 6Install the phones4,511 7Move into the Office2,6,420

22. 14-22 Network for ‘Open a New Office’ (Figure 14.5) 1 2 43 ES EF LS LF 7 65 1 6 0 1 1 2 4 5 1 2 2 3 6 8 3 5 4 5 5 6 2 4

23. 14-23 PERT Program Evaluation Review Technique Used under conditions of uncertainty in activity times Requires three time estimates for each activity –Optimistic –Most likely –Pessimistic Times distributed according to beta distribution

24. 14-24 PERT Activity Times Estimate three times for each activity Compute mean completion time for each activity:

25. 14-25 PERT Activity Times Compute the variance for each activity: Assumes pessimistic and optimistic times cover six standard deviations

26. 14-26 PERT Activity Times If T = total completion time of the project, then and

27. 14-27 CPM Critical Path Method Used under conditions of certainty in activity times Requires one time estimate for each activity Looks at time/cost trade-offs –Normal activity time –Normal cost –Crash time –Crash cost

28. 14-28 Time-Cost Relationship in CPM Crash Cost Cost Normal Cost Crash Time Normal Time

29. 14-29 Use of Project Management Concepts Scheduling is only part of a complete approach to project management Trade-off between sophistication and cost of methods Choice between constant time, PERT, CPM or more advanced techniques Choice of project management software packages, e.g. Microsoft Project

30. 14-30 Summary What is a “project”? Objectives and tradeoffs Planning and Control in Projects Scheduling Methods Constant-Time Networks PERT Method CPM Method Use of Project Management Concepts