1. Copyright 2006 John Wiley & Sons, Inc. Beni Asllani University of Tennessee at Chattanooga Project Management Operations Management - 5 th Edition Chapter 9 Roberta Russell & Bernard W. Taylor, III

2. Copyright 2006 John Wiley & Sons, Inc.9-2 Lecture Outline Project Planning Project Scheduling Project Control CPM/PERT

3. Copyright 2006 John Wiley & Sons, Inc.9-3 What is a Project? Project unique, one-time operational activity or effort Examples constructing houses, factories, shopping malls, athletic stadiums or arenas developing military weapons systems, aircrafts, new ships launching satellite systems constructing oil pipelines developing and implementing new computer systems planning concert, football games, or basketball tournaments introducing new products into market

4. Copyright 2006 John Wiley & Sons, Inc.9-4 Project Elements Objective Objective Scope Scope Contract requirements Contract requirements Schedules Schedules Resources Resources Personnel Personnel Control Control Risk and problem analysis Risk and problem analysis

5. Copyright 2006 John Wiley & Sons, Inc.9-5 Project Management Process Project planning Project planning Project scheduling Project scheduling Project control Project control Project team Project team made up of individuals from various areas and departments within a company made up of individuals from various areas and departments within a company Matrix organization Matrix organization a team structure with members from functional areas, depending on skills required a team structure with members from functional areas, depending on skills required Project Manager Project Manager most important member of project team most important member of project team

6. Copyright 2006 John Wiley & Sons, Inc.9-6 Project Scope Scope statement Scope statement a document that provides an understanding, justification, and expected result of a project a document that provides an understanding, justification, and expected result of a project Statement of work Statement of work written description of objectives of a project written description of objectives of a project Work breakdown structure Work breakdown structure breaks down a project into components, subcomponents, activities, and tasks breaks down a project into components, subcomponents, activities, and tasks

7. Copyright 2006 John Wiley & Sons, Inc.9-7 Work Breakdown Structure for Computer Order Processing System Project

8. Copyright 2006 John Wiley & Sons, Inc.9-8 Organizational Breakdown Structure Organizational Breakdown Structure a chart that shows which organizational units are responsible for work items a chart that shows which organizational units are responsible for work items Responsibility Assignment Matrix Responsibility Assignment Matrix shows who is responsible for work in a project shows who is responsible for work in a project

9. Copyright 2006 John Wiley & Sons, Inc.9-9 Project Scheduling Steps Steps Define activities Define activities Sequence activities Sequence activities Estimate time Estimate time Develop schedule Develop schedule Techniques Techniques Gantt chart Gantt chart CPM CPM PERT PERT Microsoft Project Microsoft Project

10. Copyright 2006 John Wiley & Sons, Inc.9-10 Gantt Chart Graph or bar chart with a bar for each project activity that shows passage of time Provides visual display of project schedule Provides visual display of project schedule Slack amount of time an activity can be delayed without delaying the project

11. Copyright 2006 John Wiley & Sons, Inc.9-11 |||||||||| Activity Design house and obtain financing Lay foundation Order and receive materials Build house Select paint Select carpet Finish work 0246810 MonthMonth 13579135791357913579 Example of Gantt Chart

12. Copyright 2006 John Wiley & Sons, Inc.9-12 Project Control Time management Time management Cost management Cost management Quality management Quality management Performance management Performance management Earned Value Analysis Earned Value Analysis a standard procedure for numerically measuring a projects progress, forecasting its completion date and cost and measuring schedule and budget variation a standard procedure for numerically measuring a projects progress, forecasting its completion date and cost and measuring schedule and budget variation Communication Communication Enterprise project management Enterprise project management

13. Copyright 2006 John Wiley & Sons, Inc.9-13 CPM/PERT Critical Path Method (CPM) Critical Path Method (CPM) DuPont & Remington-Rand (1956) DuPont & Remington-Rand (1956) Deterministic task times Deterministic task times Activity-on-node network construction Activity-on-node network construction Project Evaluation and Review Technique (PERT) Project Evaluation and Review Technique (PERT) US Navy, Booz, Allen & Hamilton US Navy, Booz, Allen & Hamilton Multiple task time estimates Multiple task time estimates Activity-on-arrow network construction Activity-on-arrow network construction

14. Copyright 2006 John Wiley & Sons, Inc.9-14 Project Network Activity-on-node (AON) nodes represent activities, and arrows show precedence relationships Activity-on-arrow (AOA) arrows represent activities and nodes are events for points in time Event completion or beginning of an activity in a project 1 3 2 Branch Node

15. Copyright 2006 John Wiley & Sons, Inc.9-15 AOA Project Network for a House 3 20 1 3 11 1 12467 3 5 Lay foundation Design house and obtain financing Order and receive materials Dummy Finish work Select carpet Select paint Build house

16. Copyright 2006 John Wiley & Sons, Inc.9-16 Concurrent Activities 23 Lay foundation Order material (a)Incorrect precedence relationship (b)Correct precedence relationship 3 42 Dummy Layfoundation Order material 1 20

17. Copyright 2006 John Wiley & Sons, Inc.9-17 AON Network for House Building Project 1 3 2 2 4 3 3 1 5 1 6 1 7 1Start Design house and obtain financing Order and receive materials Select paint Select carpet Lay foundations Build house Finish work

18. Copyright 2006 John Wiley & Sons, Inc.9-18 1 3 2 2 4 3 3 1 5 1 6 1 7 1Start Critical Path Critical path Critical path Longest path through a network Longest path through a network Minimum project completion time Minimum project completion time A:1-2-4-7 3 + 2 + 3 + 1 = 9 months B:1-2-5-6-7 3 + 2 + 1 + 1 + 1 = 8 months C:1-3-4-7 3 + 1 + 3 + 1 = 8 months D:1-3-5-6-7 3 + 1 + 1 + 1 + 1 = 7 months

19. Copyright 2006 John Wiley & Sons, Inc.9-19 Activity Start Times 1 3 2 2 4 3 3 1 5 1 6 1 7 1 Start Start at 3 months Start at 6 months Start at 5 months Finish at 9 months Finish

20. Copyright 2006 John Wiley & Sons, Inc.9-20 Mode Configuration 103 303 Activity number Activity duration Earliest start Latest start Earliest finish Latest finish

21. Copyright 2006 John Wiley & Sons, Inc.9-21 Forward Pass Start at the beginning of CPM/PERT network to determine the earliest activity times Earliest Start Time (ES) earliest time an activity can start ES = maximum EF of immediate predecessors Earliest finish time (EF) earliest time an activity can finish earliest start time plus activity time EF= ES + t

22. Copyright 2006 John Wiley & Sons, Inc.9-22 Earliest Activity Start and Finish Times 103 3 235 2 334 1 556 1 458 3 667 1 789 1 Start Design house and obtain financing Select pain Lay foundations Select carpet Build house Finish work Order and receive materials

23. Copyright 2006 John Wiley & Sons, Inc.9-23 Backward Pass Determines latest activity times by starting at the end of CPM/PERT network and working backward Latest Start Time (LS) Latest time an activity can start without delaying critical path time LS= LF - t Latest finish time (LF) latest time an activity can be completed without delaying critical path time LS = minimum LS of immediate predecessors

24. Copyright 2006 John Wiley & Sons, Inc.9-24 Latest Activity Start and Finish Times 103 303 235 235 334 145 556 167 458 358 667 178 789 189 Start Design house and obtain financing Select pain Lay foundations Select carpet Build house Finish work Order and receive materials

25. Copyright 2006 John Wiley & Sons, Inc.9-25 * Critical Path 00 99998888 *7*7 11 77886677 66 11 66775566 55 00 88885555 *4*4 114455334433 00 55553333 *2*2 00 33330000 *1*1 Slack S EF LF ES LS Activity Activity Slack