Chapter 11: Project Management 1

Chapter 11: Project Management
Introduction
Previous Examples of Projects

Transporting Olympic Flame (Chapter 1) Mercedes-Benz facility location (Chapter 5)
Viper Development Project
Project team given 3 years to go from concept to roadster.
Needed to develop new 8.0-litter V-10 aluminum engine and new high performance six-speed transmission. Comparable projects usually require five years at Chrysler.
Viper Development Project cont

Project team members hand-picked. Artemis Prestige selected to help manage project
ability to track several projects concurrently interactive use provide broad picture of entire project help identify the impact of each activity on the ultimate completion of the project
Chapter 11: Project Management 5
Viper Development Project: An Overwhelming Success
First test engine required less than a year to develop. Transmission developed in 1.5 years compared to the usual 5 to 6 years. Many important innovations in the frame, body, and brakes were incorporated .
Zeneca Pharmaceuticals
Mission is the development of new drugs for the medical community. The development of a new drug is a complex project with typical durations of 10 years.
Zeneca Pharmaceuticals: Major Steps in Drug Development

Preclinical Testing Investigational New Drug Human Clinical Testing
three separate phases
New Drug Application Approval

Differences Between Pharmaceutical R&D Projects and Other Industries
Final product is information rather than a physical product. Long duration, extreme costs, and high chances for failure.
Background
Project management concerned with managing organizational activities. Often used to integrate and coordinate diverse activities. Projects are special types of processes.
10
Defining a Project
Projects are processes that are performed infrequently and ad hoc, with a clear specification of the desired objective.
11
Examples of Projects
Constructing highways, bridges, tunnels and dams Erecting skyscrapers, steel mills, and homes Organizing conferences and conventions Managing R&D projects Running political campaigns, war operations, and advertising campaigns
Reasons for Growth in Project Operations

More Sophisticated Technology Better-Educated Citizens More Leisure Time Increased Accountability Higher Productivity Faster Response to Customers Greater customization for customers
Planning the Project
14
Life Cycle of a Project (Stretched-S) & (Exponential)
15
Organizing the Project Team

Ad Hoc Project Form Weak Functional Matrix Strong Project Matrix
16
Types of Project Team Members
Those having a long-term relationship with the project. Those that the PM will need to communicate with closely. Those with rare skills necessary to project success.
17
Project Plans
18
Work Breakdown Structure
19
Project Master Schedule
20
Complexity of Scheduling Project Activities

Large number of activities Precedence relationships Limited time of the project
21
Planning and Scheduling Projects
Planning. Determining what must be done and which tasks must precede others. Scheduling. Determining when the tasks must be completed; when they can and when they must be started; which tasks are critical to the timely completion of the project; and which tasks have slack and how much.
Scheduling the Project: PERT and CPM
23
Terminology

Activity Event Network Path Critical Path Critical Activities

Project Planning When Activity Times are Known
Inputs

list of the activities that must be completed activity completion times activity precedence relationships
25
Project Planning When Activity Times are Known continued
Outputs graphical representation of project time to complete project identification of critical path(s) and activities activity and path slack earliest and latest time each activity can be started earliest and latest time each activity can be completed
26
Example
Activity Time Preceded By A 10 -B 7 -C 5 A D 13 A E 4 B,C F 12 D G 14 E
Network Diagram
28
Early Start and Finish Times
29
Latest Start and Finish Times
30
Activity Slack Time

TES = earliest start time for activity TLS = latest start time for activity TEF = earliest finish time for activity TLF = latest finish time for activity Activity Slack = TLS - TES = TLF - TEF
Path Slack
Duration of Critical Path - Path Duration Path Slack
32
Activity Slack Times

Activity A B C D E F G ES EF LS LF Slack 0 0 10 10 15 23 19 10 7 15 23 19 35 33 0 10 12 10 17 23 21 10 17 17 23 21 35 35 0 10 2 0 2 0 2
33
Project Planning When Activity Times are Uncertain
Inputs
Optimistic (to), most likely (tm), and pessimistic (tp) time estimate for each activity activity precedence relationships graphical representation of project expected activity and path completion times variance of activity and path completion times probability that project completed by specified time Chapter 11: Project Management
Outputs

34
Expected Activity Time and Variance of Activity Time
te =
t o + 4t m + t p 6
2
t p to = 6
2
35
Example
Activity Preceded By
A B C D E F G --A A B,C D E
to
2 5 3 10 3 8 2
tm
6 7 5 10 4 12 4
tp
7 9 6 10 5 13 8
te
5.50 7.00 4.83 10.0 4.0 11.5 4.33
2
.694 .444 .250 0.000 .111 .694 1.000
36
Network Diagram with Expected Activity Times and Variances
[5.5, 0.694]
2 [10, 0.0]
D C [4.83, 0.250]
4
F [11.5, 0.913]
1
[7.0, 0.444]
A B
6
E
G [4.33, 1.0]
[4.0, 0.111]
37
Expected Completion Time and Variance of Path A-D-F

Expected completion time = 5.5 + 10 + 11.5=27
Path Variance = 0.694 + 0 + 0.913 = 1.607
38
Path Expected Times and Variances

Expected Standard Time Variance Deviation 27 14.66 15.33 1.607 2.055 1.555 1.27 1.43 1.25
Path A-D-F A-C-E-G B-E-G
39
Probabilities of Completion
desired completion time - expected completion time z= V
40
Probability of Project Being Completed on or Before Time 25 Only path A-D-F has reasonable chance of taking 25 or more:
25 27 z= = 157 . 1.27
From standard normal table in Appendix A, there is a 5.82% chance of completing project on or before time 25.
Probability of Path A-D-F being Completed on or Before Time 25
5.82%
42
Plan E Project Operations Network
43
Proper Use of Dummy Activities
44
Activity Expected Times and Variances
45
Simulating Project Completion Times with Spreadsheets
C A D E F
46
Simulating Project Completion Times

Standard Deviation 1.2 3.1 2.2 5.2 6.2 4.1
47
Activity A B C D E F
Mean (days) 32.1 24.6 22.2 26.1 34.4 34.5

Activity Activity Activity Activity Activity A B C D E
Activity F
Minimum Maximum
Path1 Path 2 (A-C-F) (B-D-F) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Path 3 (B-E) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Project Finish Time 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Project Management Software Capabilities
50
Microsoft Projects Gantt Chart
51
Pert Chart Generated by Microsoft Project
52
Calendar of Activities Created by Microsoft Project
53
Controlling the Project: Cost and Performance
54
Variance Report
Cost standard determined using engineering estimates or analysis of past performance Actual cost monitored and compared with cost standard Project manager can exert control if difference between standard and actual (called a variance) is considered significant.
55
Cost-Schedule Reconciliation Charts
56
Earned Value Chart
57
Goldratts Critical Chain
58
Introduction
Similar issues that trouble people about working on projects regardless of type of project

unrealistic due dates too many changes resources and data not available unrealistic budget
These issues/problems related to need to make trade-offs To what extent are these problems caused by human decisions and practices?
Three Project Scenarios
60
Project Completion Time Statistics
61
Observations

Average Completion Times Implications of Assuming Known Activity Times Shape of the Distribution Worker Time Estimates Impact of Inflated Time Estimates Student Syndrome
Multitasking
63
Alternative Gantt Charts for Projects A and B
64
Common Chain of Events
Underestimate time needed to complete project
assumption of known activity times and independent paths
Project team members inflate time estimates Work fills available time

student syndrome early completions not reported

Common Chain of Events continued

Safety time misused Misused safety time results in missed deadlines Hidden safety time complicates task of prioritizing project activities Lack of clear priorities results in poor multitasking
Common Chain of Events concluded
Poor multitasking increases task durations Uneven demand on resources also results due to poor multitasking More projects undertaken to ensure all resources fully utilized More projects further increases poor multitasking
Reversing the Cycle
Reduce number of projects assigned to each individual Schedule start of new projects based on availability of bottleneck resources Reduce amount of safety time added to individual tasks and then add some fraction back as project buffer
activity durations set so that there is a high probability the task will not be finished on time
The Critical Chain
Longest chain of consecutively dependent events
considers both precedence relationships and resource dependencies
Project Buffer Feeding Buffer
69
Sample Network Diagram
70
Project and Feeder Buffers
71
Copyright
Copyright 2006 John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that named in Section 117 of the United States Copyright Act without the express written consent of the copyright owner is unlawful. Requests for further information should be addressed to the Permissions Department, John Wiley & Sons, Inc. Adopters of the textbook are granted permission to make back-up copies for their own use only, to make copies for distribution to students of the course the textbook is used in, and to modify this material to best suit their instructional needs. Under no circumstances can copies be made for resale. The Publisher assumes no responsibility for errors, omissions, or damages, caused by the use of these programs or from the use of the information contained herein.
72

Chapter 11: Project Management 1

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Chapter 11: Project Management 1

Uploaded by

Copyright:

Available Formats

Chapter 11: Project Management