1. 3 - 1 Course Title: Production and Operations Management Course Code: MGT 362 Course Book: Operations Management 10 th Edition. By Jay Heizer & Barry Render

2. 3 - 2 Chapter 3: Project Management

3. 3 - 3  Project Planning  The Project Manager  Work Breakdown Structure  Project Scheduling  Project Controlling  Project Management Techniques: PERT and CPM  The Framework of PERT and CPM Summary Of The Previous Presentation

4. 3 - 4 Outline  Project Planning  The Project Manager  Work Breakdown Structure  Project Scheduling  Project Controlling  Project Management Techniques: PERT and CPM  The Framework of PERT and CPM  Network Diagrams and Approaches  Activity-on-Node Example  Activity-on-Arrow Example

5. 3 - 5 Outline - Continued  Determining the Project Schedule  Forward Pass  Backward Pass  Calculating Slack Time and Identifying the Critical Path(s)  Variability in Activity Times  Three Time Estimates in PERT  Probability of Project Completion  Cost-Time Trade-Offs and Project Crashing  A Critique of PERT and CPM  Using Microsoft Project to Manage Projects

6. 3 - 6 A Comparison of AON and AOA Network Conventions Activity onActivityActivity on Node (AON)MeaningArrow (AOA) A comes before B, which comes before C. (a) A B C BAC A and B must both be completed before C can start. (b) A C C B A B B and C cannot begin until A is completed. (c) B A C A B C Figure 3.5

7. 3 - 7 A Comparison of AON and AOA Network Conventions Activity onActivityActivity on Node (AON)MeaningArrow (AOA) C and D cannot begin until both A and B are completed. (d) A B C D B AC D C cannot begin until both A and B are completed; D cannot begin until B is completed. A dummy activity is introduced in AOA. (e) CA BD Dummy activity A B C D Figure 3.5

8. 3 - 8 A Comparison of AON and AOA Network Conventions Activity onActivityActivity on Node (AON)MeaningArrow (AOA) B and C cannot begin until A is completed. D cannot begin until both B and C are completed. A dummy activity is again introduced in AOA. (f) A C DB AB C D Dummy activity Figure 3.5

9. 3 - 9 AON Example ActivityDescription Immediate Predecessors ABuild internal components— BModify roof and floor— CConstruct collection stackA DPour concrete and install frameA, B EBuild high-temperature burnerC FInstall pollution control systemC GInstall air pollution deviceD, E HInspect and testF, G Milwaukee Paper Manufacturing's Activities and Predecessors Table 3.1

10. 3 - 10 ActivityDescriptionTime (weeks) ABuild internal components2 BModify roof and floor3 CConstruct collection stack2 DPour concrete and install frame4 EBuild high-temperature burner4 FInstall pollution control system 3 GInstall air pollution device5 HInspect and test2 Total Time (weeks)25

11. 3 - 11 Activit yDescriptionImmediate Predecessors ABuild internal components — BModify roof and floor— CConstruct collection stack A DPour concrete and install frame A, B EBuild high-temperature burner C FInstall pollution control system C GInstall air pollution deviceD, E HInspect and testF, G

12. 3 - 12 AON Network for Milwaukee Paper G E F H C A Start DB Arrows Show Precedence Relationships Figure 3.8

13. 3 - 13 H (Inspect/ Test) 7 Dummy Activity AOA Network for Milwaukee Paper 6 F (Install Controls) E (Build Burner) G (Install Pollution Device) 5 D (Pour Concrete/ Install Frame) 4 C (Construct Stack) 1 3 2 B (Modify Roof/Floor) A (Build Internal Components) Figure 3.9

14. 3 - 14 Determining the Project Schedule Perform a Critical Path Analysis  The critical path is the longest path through the network  The critical path is the shortest time in which the project can be completed  Any delay in critical path activities delays the project  Critical path activities have no slack time

15. 3 - 15 Determining the Project Schedule Perform a Critical Path Analysis Table 3.2 ActivityDescriptionTime (weeks) ABuild internal components2 BModify roof and floor3 CConstruct collection stack2 DPour concrete and install frame4 EBuild high-temperature burner4 FInstall pollution control system 3 GInstall air pollution device5 HInspect and test2 Total Time (weeks)25

16. 3 - 16 Determining the Project Schedule Perform a Critical Path Analysis Table 3.2 ActivityDescriptionTime (weeks) ABuild internal components2 BModify roof and floor3 CConstruct collection stack2 DPour concrete and install frame4 EBuild high-temperature burner4 FInstall pollution control system 3 GInstall air pollution device5 HInspect and test2 Total Time (weeks)25 Earliest start (ES) =earliest time at which an activity can start, assuming all predecessors have been completed Earliest finish (EF) =earliest time at which an activity can be finished Latest start (LS) =latest time at which an activity can start so as to not delay the completion time of the entire project Latest finish (LF) =latest time by which an activity has to be finished so as to not delay the completion time of the entire project

17. 3 - 17 Determining the Project Schedule Perform a Critical Path Analysis Figure 3.10 A Activity Name or Symbol Earliest Start ES Earliest Finish EF Latest Start LS Latest Finish LF Activity Duration 2

18. 3 - 18 Forward Pass Begin at starting event and work forward Earliest Start Time Rule:  If an activity has only a single immediate predecessor, its ES equals the EF of the predecessor  If an activity has multiple immediate predecessors, its ES is the maximum of all the EF values of its predecessors ES = Max {EF of all immediate predecessors}

19. 3 - 19 Forward Pass Begin at starting event and work forward Earliest Finish Time Rule:  The earliest finish time (EF) of an activity is the sum of its earliest start time (ES) and its activity time EF = ES + Activity time

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21. 3 - 21 E4E4 F3F3 G5G5 H2H2 481315 4 813 7 D4D4 37 C2C2 24 ES/EF Network for Milwaukee Paper B3B3 03 Start 0 0 0 A2A2 20 Figure 3.11

22. 3 - 22 Backward Pass Begin with the last event and work backwards Latest Finish Time Rule:  If an activity is an immediate predecessor for just a single activity, its LF equals the LS of the activity that immediately follows it  If an activity is an immediate predecessor to more than one activity, its LF is the minimum of all LS values of all activities that immediately follow it LF = Min {LS of all immediate following activities}

23. 3 - 23 Backward Pass Begin with the last event and work backwards Latest Start Time Rule:  The latest start time (LS) of an activity is the difference of its latest finish time (LF) and its activity time LS = LF – Activity time

24. 3 - 24 LS/LF Times for Milwaukee Paper E4E4 F3F3 G5G5 H2H2 481315 4 813 7 D4D4 37 C2C2 24 B3B3 03 Start 0 0 0 A2A2 20 LF = EF of Project 1513 LS = LF – Activity time

25. 3 - 25 LS/LF Times for Milwaukee Paper E4E4 F3F3 G5G5 H2H2 481315 4 813 7 15 D4D4 37 C2C2 24 B3B3 03 Start 0 0 0 A2A2 20

26. 3 - 26 LS/LF Times for Milwaukee Paper E4E4 F3F3 G5G5 H2H2 481315 4 813 7 15 1013 8 48 D4D4 37 C2C2 24 B3B3 03 Start 0 0 0 A2A2 20 42 84 20 41 00

27. 3 - 27 Computing Slack Time After computing the ES, EF, LS, and LF times for all activities, compute the slack or free time for each activity  Slack is the length of time an activity can be delayed without delaying the entire project Slack = LS – ES or Slack = LF – EF

28. 3 - 28 Computing Slack Time Table 3.3 EarliestEarliestLatestLatestOn StartFinishStartFinishSlackCritical ActivityESEFLSLFLS – ESPath A02020Yes B03141No C24240Yes D37481No E48480Yes F4710136No G8138130Yes H131513150Yes

29. 3 - 29 Critical Path for Milwaukee Paper E4E4 F3F3 G5G5 H2H2 481315 4 813 7 15 1013 8 48 D4D4 37 C2C2 24 B3B3 03 Start 0 0 0 A2A2 20 42 84 20 41 00

30. 3 - 30 ES – EF Gantt Chart for Milwaukee Paper ABuild internal components BModify roof and floor CConstruct collection stack DPour concrete and install frame EBuild high- temperature burner FInstall pollution control system GInstall air pollution device HInspect and test 12345678910111213141516

31. 3 - 31 LS – LF Gantt Chart for Milwaukee Paper ABuild internal components BModify roof and floor CConstruct collection stack DPour concrete and install frame EBuild high- temperature burner FInstall pollution control system GInstall air pollution device HInspect and test 12345678910111213141516

32. 3 - 32 Summary  Project Management Techniques: PERT and CPM  The Framework of PERT and CPM  Network Diagrams and Approaches  Activity-on-Node Example  Activity-on-Arrow Example  Determining the Project Schedule  Forward Pass  Backward Pass  Calculating Slack Time and Identifying the Critical Path(s)

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