UNIT 13 PROJECT MANAGEMENT

Structure .13.1 Introduction
Objectives

13.2 Project Planning and Organising
13.2.1 13.2.2 13.2.3 13.2.4 13.3.1 13.3.2 13.3.3 13.3.4 13.3.5 Development of Project Plan Objectives Programming and Scheduling Pmjec? Budget and Fund Flow Stztus Project Organisation Origin of Bar Chart and CPMPER-T Detailed Study of CPM Precedence Network CPM Line of Balance @OB)

13.3 CPM and Other Project Planning Techniques

13.4 Procurement and Materials Management 13.5 Contracting and Construction Management
13.5.1 13.5.2 13.5.3 13.5.4 13.5.5 13.5.6 13.6.1 13.6.2 13.6.3 13.6.4 13.6.5 Contracting Approach Contractors' Role Types of Contract Contracting Procedure Objective of Construction Management Definition of CM's Scope Time and Cost Control Tools and Techniques Decision Making as a Control Frnction Time crashingkonomy Analysis Information Reporting System Risk Management as a Control Functioy

13.6 Project Control

13.7 Summary 13.8 Answers to SAQs

INTRODUCTION

,

Management is a process concerned with achievement of goals or objectives. Project Management involves the coordination of group activity wherein the manager plans, organizes staff, directs, and controls to achieve an objective with constraints on time, cost and performance of the end product. It is appropriate at this point to elaborate on the term project. A projectis a set of tasks or activities related to the achievement of some lanned objective, normally where the 9 Thus, a project is usually distinguished from objective is unique or non-repetitive in nature. repetitive or continuous production process by the characteristic of uniqueness or the 'one shot' nature of the objective. Projects may involve routineprocedures where project planning techniques are useful for detailed analysis and optimization of the operating plan. Planning is the process of preparing for the commitment of resources in the most effective fashion. Controlling is the process of malung events conform to schedules by coordinating the action of all functions of the organisation according to the plan established for attaining the objective. It can also be said that project management is a blend of art and science : the art of getting,things done through and with people in formally organised groups; and the science of handling laqe volume of data to plan and control so that project duration and cost are balanced and excessive and disruptive demands on scare resources are avoided. In order to accomplish the project goal or objective, the manager must plan and schedule largely on the basis of his experience with similar projects, applying his judgment to the particular conditions of the project at hand. During the course of the project, he must continually replan and reschedule because of unexpected progress, delays or technical conditions. Until the advent of critical plan methods there was no generally accepted formal procedure to aid in the management of project. Each manager had his own scheme, which

In the planning stage. . for cases where achievement of the project objective(s) can be measured on a con. fitting in which the overall project time and project cost is the essential requirement for a project's success. Also management is interested in scheduling these activities in an acceptable time scale. realistic plan. An achievable. with an allot~nent of resources within the overall project cost. The ultimate objective of planning is timely and economical implementation of project. steps and means for achieving the project objectives. conmissioning and start-up services which translate a project concept into a goods producing or service generating facility should be very well planned. Management is also concerned with monitoring the expenditure of time and money in carrying out the scheduled program. and an arithmetic procedure which identifies the relative importance of each element in the overall schedule. organised. considering the manpower and other resources required to cany out the program as it progresses in time. development. Performance guidelines and a controlling system to evaluate . introduction of new products or service or changeovers to new models. The development of network based planning methods in the late fifties provided the basis for a more formal and general approach toward a discipline of project management. the project is broken down into many manageable elements fixes into a time frame within the averall time schedule. and released for execution. as well as the resulting output. emergency planning and even the production of motion pictures.tinuous or ordinal scale(s). equipment and plant maintenance and installation. without hold-up.Introduction to Project. identify the critical path of a project. management information systems developments production planning. you should be able to understand the various aspects of project management. Between the formulation of preliminary plan in the Detailed Project Report stage and the finalisation of plan for implementation. management is concerned with developing a optimu~li plan of the activities that make up the project including a specification of the~r interrelationships. A well designed performance reporting system and a good data management system are vital requirement for an efficient Project Management Function.and modify the performance as required. discuss various techniques of project planning implementation. and define risk management as a control function. develop a computer system for preparing computerised network based project planning. Engineering contract. The planning exercise should be guided initially by the overall time schedule and cost estimate given in the Detailed Project Report. Objectives After studying this unit. all types of construction work. PROJECT PLANNING AND ORGANISING Planning is the formation of a detailed scheme for proper arrangement of the necessary actions.a useful tool in production mlagement but inadequate for the complex interrelationships associated with contemporary project management. critical path methods have been applied with notable success to research and development programs. implemented and controlled for the success of the project. contracting. shall form part of the plan. conduct of political campaigns and complex surgery. quality or performance. and workable In all of these projects. co~nnlitment on the part of people engaged on implementation and involvement by the top management in the monitoring of projects and trouble-shooting. Since their . All of these activities are classed as projects. describe various controlling tools and techniques to combat project overruns. Management often involved linlited use of bar charts . the planning has to be subjecteuto iteration for a possible refomlation of the preliminary plan. strategic long term planning. Critical path methods involve both a graphical portrayal of the interrelationships among the elements of a project. ' enumerate various project procurement and materials management functions. construction and commissioning to proceed as per schedule. developments of major transportation and energy related systems. The owner of the project must closely monitor all the functions and ensure that its various activities are on schedule and they are enabling other project activities like procurement. A well managed project should have a proper integration in both planning and implementation efforts.

It is form. In the section we are dealing with the definition of tasks and the strategy to accomplish them.2. and the technical. equipment and materials. Project Management 13. off-sites and infrastructural facilities. The structure of codification would depend on the size. thus reducing the level of inaccuracy to the minimum. acsets and liabilities etc. integration and computerisationof drawings and technical documents. As calendar dating may be impossible at this stage.h hundreds of tasks and thousands o f work elements are integrated. Planning aims at achieving the projects completion making the most effective use of time and resources. schedules. efforts must be made to refine them before using them for planning. task duration. The models shall indicate the various angles of the type and magnitude o f the work to be put in. progress reports.13. Definition of Work Here define the listed work elements in greater detailed for clear understanding.2 Programming and Scheduling Programme is the forerunner of schedule. simple to understand and consistent with the resources levels fixed (and assumptions made) in the Detailed Project Report estimates.1 Development of Project Plan Objectives It is a universal practice to define the scope of the plan before drawing of a detailed plan. This list can be simple. Coding can be done either numerically or alphabetically and combined alpha-numerically. Modeling the Wark Make graphic models of the main segments and important elements of the work. area wise or function wise. performance evaluation. budget commitments. if any. income and expenditure. bills. or process stage wise. functional and logical relationship of the various activities involved in the work. Break down the total project work into manageable self contained and independently executable work packages and the down-the-line activities. contracts. type and accounting needs of the project and the enterprise. reference. tabular statement with columns for task code. so that once the planning activity is started there is no hold up for want of right kind of resources. While Detailed Project Report contains such information. measurable. ' Various steps of progranlming are briefly illustrated below : Listing of Work List the tasks and the activities under each tasks.2. Work Breakdown Structure and Codification of Tasks Simultaneous efforts and specialists attention in several fronts are necessary for the efficient implementation of a project. etc. WBS is a function of programming. manpower and other inputs. Ensure that the objectives are achievable. Besides. task description. C~dification of tasks and related projects accounts facilitate effective management aid control. costs. a progralnrpe of action. the planner will require all key information about the project. WBS contains. Addition of time duration to every model with a beginning and an end is done here. purchase orders. So. These models will help you to understand the variables you have to handle in translating the plans into a reality. These definition should remove uncertainties. A clear understanding of the plan objectives is a requirement for the plan's success. or crafts wise. the volume of work allotted to a team should be of a controllable size only. work programming has to be done if the . the time is fixed in time of project months or project days. It is a useful practice in large projects to use structured codes for identification. starting from the zero date which is the first milestone of the project. Apart from estimates. contained in detailed project reports. Fixation of Sequence and Priarity A project is an integrated whole unit into whic. accounting. It is for these reasons that work breakdown structure (WBS) is made. This is normally done by preparing a questionnaire and fill it up before sitting down to do the planning. These lists will form the foundation of the subsequent steps of a more detailed definition of work. that the schedule is prepared. showing main work elements of the total projects by functionsf deciplinef skillsf crafts.

plotbing all the important seglnents wit11 thc mtlicalioti of their interrelationships. in a large project.one.rnd in most cases remobilisation and even some re-works. The starting date so arrived at will be the latest sli~rtil~g The guiding philosophy liere is ''finish economically when required". Besides. try to revise the activity duration using 111e Forward and Backwarcl scheduling technique and adjust the volu~nc of activities to suit the available resources. Interfacing of the models will establish the. Thc philosophy here is "finish every activity as early as possible".ject mc. In actual-practice t l ~ e time duration is fixed on the basis of the previous on-the-job experience of the plmiers and the line managers.uance is available for an activity aid it often finishes before the required due dat(.uld the making the optimum use of tliem h). So. . time duration for individual activities and for the total pro.. wastage.L otti~ proiecl duration. Backward scl~cdule starts backw. necessitating a corresponding phased-out col~lpletion of work. Fixation of Activity Duration Every acti\:ity shall be allotted a realistically estimated time duration so tlint tlie sum total of all such durations rninus the net overlapping would be cclu. conncctions and testing towards tlie etitl ot tllt3 project. for economic or technical reasons. That would cause a lot of confusion. Llie estimated ccists are interrelated through the scheduling exercise. Schedulin. taking advantage of tloars. interrelationship. resources. It is usual to fix a shorter than permitted duration. and the main work elements of engineering. after previous co~nmitments (KK) I'or Assess the most economic quantity ot Resources Reilu~re~i~e~its finishing the activity within the time duration. Resources availability and their econon~ic levels of distribution. but in a project with a few hundred thousands ide~~tifiable work elements. taking advantage of their tloats. Identification of Critical A$tivities In total prc>. For these reasons. Various steps of sqlleduling are enumerated below Forward and ~ a c k w a r d Scheduling orw ward and backward scheduling is a scheduling strategy used for keepin'g rrlown the level of resources deployment . Moreover. If the RR is more th'm AR. Scheduling is a substantial improvement on programming. required starting datc.y is pri~~cipally the exercise of laying out and integrating time. but at the same time some other items are so critical that the prccedii~g items tie in arid start of succeeding items are dependent on their finishi~ig. some segments may have to he accomplished on priority over otl~ers. lock up of money .gency time.del placing individual scgments models end-to-user or clrawing a time phased master bar chart. sequence anti priori~y have to be given due consideration while programmning. as their finishing does not hold up other activities. the activity time.Iatroducticrn to Project Management interrelationship of work in nlind. Resources Assessment and Matching Every project owner's resources liave some lirmtations for reasons of ecotiolny previous commitments. what 1s u~ually done in scheduling is as tollo\v\ (a) (b) (c) iuitl Take stock of the total Available Resources (AR) that can be niohiliaed during if any. in the interest of timely coniplction ol' tl~csproject. Forward schedule starts as soon as working lion1 cle.jcct. one cannot a f i r d to leilve half of them executed out-of-sequence nnd wait for mass finishing assembly. Scheduled completion time plus contingency trine is the target ti~iie. it can be found some items have fairly long I'loats or slack time between starting and finishing. Tliese latter items have to be separately identified and listed for special nianascnient attention towards their completion. It must be possible to carry out niruiy work elen~ents intlcpendently upto their assembly stage. This provision is contui.'\ sleeve as a "But'fer Time" for any possible slippage. tliffcre~~t work packages may liave different phased-out comnlissioning dates for technical iuld financial results. procurement a i d construction in the most efl'icient manner to achieve the project objectives. keeping a few days up .uds from the required due date of finishing the activity and arrives at a dak. and then calculate the Reassessed Recluirkments of Resources (KKR). but with due consideration to dependencies of activities aid overall projcct co~iipletion target.d.

you must ensure availability of the reyuired numb& of ths: right type of staff and workmen for the project management and construction. usually the same nornls are used as were used for Detailed Project Report or historical figures of the enterprise andor the industry average. Make a Inaster bar chart schedule of the activities with startii~g and finishing dates and corresponding tabular schedule of time phased allocation of all resources. checked and confirmed by experienced executives. Important points to be borne in mind while scheduling construction work are availability of construction drawings and materials and the possibility of mobilising economically the reyuired workforce. the required number of men of the right type are available. . inate and project investment cost distribution schedule and their subseyuent refinement based on firmed up project data and ei~gii~eerii~g details. Construction Equipment Usage Schedule Normally. to enable t~iiiely work execution. equipment and materials for the same work packages in a matching tiille phase with considerations for procurement time and mobilisation time. A corresponding master budget shall ellsure financial urces schedule and master fund allocation and the project fund flow. and Management and control. The master flow statement shall be based on the pnject cost e. permanent. permanent. suiting the overall project schedule. One shbuld always keep in mind following points while preparing the Manpower Schedule : - Uileconomical peaks and valleys in the employment levels.(d) (e) Make provision for procurement of the difference between RRR and AR. ii~cludii~g the entire field labour.Usage of rare skills. Operation and maintenance. and parlicularly before manpower scheduling is taken up. So a schedule for their proper usage with reference to the schedule of the project work bifurcating it between "to be provided by the owner" and "to be provided by contractors" and then initiate steps for their deployment. among all individual schedules. It must be remembered that the contractors who are awarded jobs will also bring in their resources as per contract stipulation for use in the project. action shall be initiated for time phased recruitment and training so that according to the demand of the work.as Construction Schedule As the cc>nstnrctionschedule has a definite impact on other schedules. till the completion of construction. Manpower Schedules Master manpower planning is reyuired for : (a) (b) (c) (d) Project management. . the construction schedule should be finalised first. Once the manpower schedule is finalised. -- . for the project duration. and as construction activities consume most of the man power employed in the project. Project Ma~lagei~~ t en Master Schedule and Master Budget A corresponding master schedule of resources should list the requirements of major resources of men. Levels of supervisory and administrative staff in proportion to the levels of workforce. I 1 1 the interest of timely planning and implementation of the project. a large project will need a large number of construction equipment of different types and capacities for material handling and construction. What is particularly important in constructicm scheduling is the integration of mnstructio~~ schedule into other schedules for overall success. . Construction. For assbiing and fixing the manpower requirement with reference to programmed q&u>tityof work.

11 character and strengthen with clearly defined responsibilities and conl~ne~lsuralc . M. The Project Manager supported by a few 'area prolcct engllleer\ and clerical staff would function as a coordinator and report dally to the CE( ).lteliicxllr. Ttlerc nay he several Project M'magers for different work segments. While the budget is prepared on financial conmitn~i.~~lcc. Integration of Schedules All supporting schedules must be dovetailed appropriately into the ~ii.ll recc~pt a1 sitc of equipment and materials should hc prepared. the organisation is given . 13. In the scheduling stage what is gener. for guidance i l l s c h c ~ ( l u l u 111cir ~~ ordering and receipt at site. After defi~Iing the work and making the WBS.~lt I.~-. Divisional orgcanisation. I ! 13. They are as follows : * ~unctional organisation. There are three different forms of pro-jectorganisation.ltement and gives an assurance of fund flow before the plan is releahcd I'( 11 implementation. without other Inore ~mport:u~t business..r\is.~r. solely alltx.lslc~Rudyct and master fund flow statenlent must support the n~aster schedule. the exact size of the project tcam . uld dlvlded Into several sections. and sequellll.iit t~tle.rut1 ~nanlled by a yuahfied and experle~icedstaft of the appropriate levels.rnd the conlplexity of the project. r ~ v lthe fornl of the organisation necessary to manage the project successfully can be dt.uid .rtion shorlltl I.~llowi~ls I'or llle procurement time.. each under the charge of a senlor per\on . each headed by a Prolect Manager or someone of eyulvalt. Such integr. in which the heads of various functional departments report to the CEO for tlie~r respective speclalised functions in the management of the project as well (he enterprise as a whole. r 1 ~ 1 11111(1 flow st. Simil~ly the owner's lnaster schedule.lilc~tl irctionnl budget and fund flow statements should support the time-phased work brcak clo\111 itructurc and detailed schedule.and Matrix orgalisation. Now they have lo he rechecked. The size of the organisation shall depend on the work load.Ordering and Delivery Schedule for Incol-porated Equipment and R/lateri:~ls For all equipment and materials including bulk ~naterials that go into t11c olccl. the specialisation i~ivolrcd . The total "procurement ti~iie"plus 2u1y poss~l~lc~ \lippa~tl time sllould be kept in nlind while ordering Ulc equipment a ~ l d ~liatcnalh 10srlir 1111' construction schedule. right down to daily targets. revised where necessary. .lted to the I 4 I i [ .lutliorities.ul aftord to l'u~~ction virtually as the chief project manager. ~ c ~ o r s ' lnaster schedules 'md the vendors' and their subvendors' Inaster schc(1ule~ 111uhl l~ integrated perfectly for overall smooth implementation. delivery 'and shipment.~s~'r cc'hedulc.2. * * Functional Organisation It is the traditionally centralised type of org. Divisional Organisation D~v~s~o project ~ i a l organisation erlvisages well knit decentralised project nranagc~lient d~vi$~ons.ire obtained and funding arrangements made.e there even in short term schedules. and the t1el.3 Project Budget and Fund Flow Status In the study phase.jectives is vital for the success of your project. time-phased schedules ol' indcnting and ordering. A project lean1 lakes over the project responsibility fro111 the study team as soon as the statutory clc~.4 Project Organisation A good project organisation in which all individuals concerned constaitly intc. 1untl flow statenle~lt is made on receipt and disbursement basis like a cash flow st. budget and fund flow statement were made.2. In this stage.I more l'onii.You nlust ensure that the funding agency or financial institution agrees with the bu(lycl .ullsation with line and stnfl \truelure.ter~lli~~c~tl. This form of organisation would suit pure project enterprises whose CEO c. atid time-phased to suit the schcdult.:~lly is to check and redesign the organisatio~~which was defined at the beginniny of tlic proiect when the study team was disbanded.s . rolling/ma~ufacturii~g/fabrication. the contractors' and their s u b ~ o ~ l l r . Based on the construction schedule. separate exllaustive lists should be prepared first.rcl I or achieving project ob.

etc. recruited solely for the particular prolect iund Unt: olhzr.I ! ! i prolecl.ition would suit an enterprise which hiw only one projccl ant1 wherc idling resources have no profilable use elsewhere. They play an important nlle in project management. This form of propxl or~. depuled by ollner functional tlepart~~nent~ lo serve the project. iLt lower levels.~nis.discuss briefly the sleps of prcgecl management Wlnat ! ' (1)) (t. O n the project they reprcsenr Lhe interest of their fulnctional departments and nught even disagree with the Project Manager in matters of schedules. Network 'ulalysis consisting of three different closely resemhling methods. nalnely : - Precedence diagram method (PDM) Critical Path Metliod (CPM) Project evaluation and review technique (PERT) - Lune of Balance (LOB) To understand the ciiscussioln in this chapter ru~d also to be able io read the network schedules of .ulisation 13. I 'ES EF - . When poster1 on the project department or at Ule site. 111i~ lnntrix organisatio~~ the pro-ject manager is. measured and control.my project. Matrix Orgi~nisi~tion and Project Team 111 (his torm o f organisatio~l there are two distinct calcgories of pcrso~ulcl one. unless sonne of them can be absorhetl in the production and managemenl. a coordinator of various functions 1e.rdiug to the project inlplenlentalion. budgets.jcct schedules a~ld butlgel are mostly enlrusted to the Project Manager with proper roles :11111 guidcli~~cs ivlnich require regular subnussion of reporls ti) the top managenlent.. The maln planning techniques used in engineering projects are : - Bar Chart.jects. SAQ 1 (11) . they go back to their functional parent departments.ct irre the dilYerenl forms of project org.3 CPM AND OTHER PROJECT PLANNING TECHNIQUES Planrnillg teclllniclues are scales and graphs by which time cost and performance are scheduled interrelated. 'lhe Projcct Manager concentrates lotally on his pro-ject. The second category may serve more thiu~ o~lc pro. withoul worrying resources about the general tnanilgement of the enterprise. but professionally and for they will report ad~ninisuatively specialist'irdvisc coutinue to report to thcir funclionill heads. to the Project Miluilger. One should learn the following terminologies and the symbols given below : I - Starting or preceding event Finishing or succeeding Early start Early finish . Tlnc first category ~lormillly faces ter~ninntion o f enlploylllent at the end of the project. ~jui~lity. in effecl.ject a t il lime according to the needs and practicilbility of U n e situation iu~d when thcir services are not needed in the pro. Pro.) What iuc t11c various steps of progranuning functions ? the various steps of scheduling function ? '? (d) W11.

an associate of F. These are three conditions which make an activity.Introduction to Project ' Management LS LF ST FT EET LET FF TF - Late start Late finish Stat time Finish time Early event time Late event time Free Float Total Float Scheduled Finish SF AS Actual Start . and and finishing &any activity which is not on critical latest possible st-g path.3. (b) The early and late finish time of the activity must be the same. Float is the time available for delaying any activity without an adverse impact on the project completion period. I Earliest time and latest time are the times for (i) (ii) the earliest possible startipg and finishing. (c) T o w float is the total flexbility available in scheduling on a shareable basis. proportionate to calendar time or schedule time. It is based on the principle of pre-determination and correlation of the quantity and duration of an activity. of Remington Rand Corporation for use in their engineering functions. the oldest and still the most widely used 'timely scale' as a planning technique was developed during World War . 1 1 arrow and ending at the head-end Activity is a cantinuing action starting at the tail-end of a that is between two events. It is geilerally a milestone. with the planned quantity of achievement distributed as periodic targets and scheduled resources distributed as periodic budgets on either sides of the bars. critical they are. Event is the point in time where one activity ends and another starts.I by Henry Gantt. Both q e techniques were developed in 1958-60. the shortest duration within which the project can be completed. Therefore. The difference between the early start time and late finish time must he equal to the activity duration. The critical path is the longest path but at the same time. 1 13.Actual Finish AF T Duration Critical path is the most important sequence of activities which have no 'floats' and which together determine the project completion period. Backward Pass is the method of calculating the latest event times by moving from tlie right +q the left or from end to the start. any delay in the critical path will correspondingly delay project completion. Free float is the time of flexibility available which if used will not delay the early start of the succeeding activity. CPM planning technique was separately and simultaneously developed but jointly perfected by Morgan Walker of DuPont Company and James E. Dunmy activity is the arrow used for showing dependency Forward Pass is the method of calculating earliest event time be inoving from the left to the night or from stxt to finish.1 Origin of Bar Chart and CPM/PERT Bar Chart. plotting them visually on straight bars. PERT was developed by the US Navy's Special Project office for-use in its defense projects. Taylor. the father of sciendfic management.W. (a) The early and late start time of the activity must be the same without il float. Kelley Jr. a .

2 Detailed Study of CPM You are by now convinced that as we are primarily concerned with the Indian context and her to the bar chart. LOB and the computer based plmung methods.As the fundamentals and the uses of both the techniques are almost the same. Figure is a simple precedence network of project study and clearances.controlling.denotes a finish-to-iinish constraint. a i d is equal to the minimum number of Linie units that mu$€tianspire from the start of the preceding activity (i) to the colnpletiofi-of the succeeding activity (j). which means the preceding activity (i) must be complete prior to the start of succeeding activity 0). the precedence. But the arrows and the method of arrangement show the flow. and is equal to the minimum number of time units that must remain to be completed on the succeeding activity (j) after the completion of preceding activity (I). SFij . and is equal to the minimum number of time units that must transpire from the completion of the preceding activity (i) prior to the start of succeeding activity (j). Project Management 13. Both aim at time-quantity-cost trade off in performance.length books listed in the bibliography.3 Precedence Network Although network is generally synonymous with CPM.1 :Precedence Network Diagram for Principal re-~m~lementatiokal Project Activities In the figure. But. One of the few good books I have studied during my research is O'Brien's CPM in Construction Management. The whole diagram can be just fitted into a time frlune after estimating reasonable durations for accomplishing the activities. To understand the precedence Network one needs to h o w the precedence logic. 13. The one difference between the two is that while CPM attaches importance to activity duration. the sequence and the simultaneous activities. we have to give in~portance the permissible length of this chapter we will also take an overview of the CPM. The precedence relation would indicate the stage of the first activity at which the second activity can start. The nomenclature and assumption to be used are as follow : SSij .3. on a closer look you will find that the precedence diagram method (PDM) has distinct identity.3. It is a simple flow chart showing the sequence of individual tasks and integration of various tasks leading to the project completion on schedule. It is not confusing ui appearance like the CPM based on "activity on arrow" and is easily adjustable. within practice-oriented techniques. Tllis relationship is finish to start (FS) type. Land Acquisitiou h Clearances Figure 13. we have assumed that the activities in the right side row are starting at the end of the activities in the preceding left ride row.denotes a start-to-start constrai~lt. FSij -'Denotes a finish-to-start constraint. PERT considers events as deterministic. precedence method. Activity numbers and activity durations are kept out for showing it3 most simple fomi for easy understanding. scheduling and. . FFij . This planning technique is comparatively simple. through planning. For detailed study you have to tum to some full .denotes a start-to-finish constraint. the two have come to be referred together as CPMPERT.

cutting. They are as follows : * * * Definition of the project scope in full Prepkation of WB S Listing of activities. assembly testing and erection. and computer based ir~ large projects with thousands of activities to be planned individually and with total integration. CPM diagrams are used in project w a g e m e n t for the following applications in particular Overall Planning. * * * * * * Figure 13. 13. chart ~ or tabular chart tallying with the CPM network. us$ lines and circles. But it is a very simple technique and can be used for scheduling and progress tracking in the following types of projects : (a) (b) A project with several independent identical units using many identical components. (c) A project consisting of several units with repetitive sequential operations like marking. accuracy in time estimates a ~ selection d of milestones. LOB enables the optimum utilisation of resources. LOB is not very popular. Like PERT. Mark the critical path. and technical and logical correctness in the determination of critical path. The subsequent steps are as follows : * Arrange the actiyities in logical sequence and number them in liilo wit11 lhe codification scheme developed. . In India. LOB also was developed by the US Navy for its own use.1 is CPiM master netwo* for aThermal Power Station. improvement of work efficiency and interference-free scheduling of wide range of activities.Introduction to Project Management 13. Ensure that either the activity descriptions are written on the liiiec o r there is a list of them whose code numbers are written on the lines. Scheduling and milestone network. Make out detailed schedule of resources in a b .steps you have made a draft summary network or a illaster network plan readv. A big project with a large volume of identical materials used in several work segments.3. rolling.4 CPM CPM networking can be done manually in small projects with a few hundred activities. welding. make detailed subsets for different work segments or packages and fragments for lower level activitlrs a n d short-term targets. * Identify key actiQitiesand milestone events and mark them prominently * Placc: the sequential numbers of events and milestones in the circles. ~ h r o u the ~ h above. A detailed network by CPM can he developed only after three things are dolie as the first step. Tracking project progress by regular monitoring and periodic updating. start-finish times and floats for all activities :uld milestones and enter them in the network. * Link h e activiti s in a network form with reference to logical relat~onarid dependency. in the first half of the 1950s. down to the bottom level elements which have t o be handled separately and have an influence on the completion of the prolect. Check the draft to ensure perfect logical relation.5 Line of Balance (LOB) Line of balance (LOB) is a graphical technique used in project planning to depict time-quantity relations. Estimate time durations. Redraw the networu's b i r copy in a calendar frame or a project time franle. The network is set in calendar time frame with activity durations indicated by the calendar time scale. From the finally drawn summary network.3.

divided into : (a) mechanical. shortage. testing. incorrect specifications. pilferage. Delayed delivery. belated very common. and (b) electrical.. (2) (3) project consumable raw materials and feedstock lubricants. mat~ufacturing replacements. are common problems in almost all projects. covering : (2) (3) (4) (5) (6) (7) (8) (9) . ( 11) ' (10) expediting (12) expediting (13) ex-factory delivery ( 14) packing and dispatching ( 15) insurance ( 16) transport and clearances (17) receipt.SAQ 2 (a) (b) What 'are the main planning techniques used in engineering projects ! ' Define activity. checking and tallying ( 18) transit damagetshortage reports (19) replacement .4 PROCUREMENT AND MATERIALS MANAGEMENT Project overruns attributable to delay in the supply of critical equipment and materials are defects. (c) instruments. (4) (B) ( 1) Procurement planning. (e) construction equipment. and quality assurance risk-purchase contingency plans . etc. spares and manufacturing consumable indenting Buy or make decision bid documents preparation asking for bidstquotations bids evaluation acceptance and approval order~ng vendors' confirmation inspection. A vigilant project management can ward off much of these problems by proper planning and control of procurement and efficient post-procurement materials management. (d) refractories. Project procuremcnt :uld materials management (MM) cover the following functions : Procurement (A) Material scheduling. (0 civil engineering materials and other bulk materials. covering : (1) critical equipment and bulk materials. How the logical sequencing of activities is achieved in iletwork ? What are the main application of CPM network analysis ? 13.

w~lll the consortiurn dividing the supplies and work among its n~enibers Divide the prolect broadly into (i) engineering and supervision. I Construction is the process through which the engineering.rl I. c. o ~ i \ l i u c t ~ o ~ ~ to a consortium of contractors with an integrated total respo~lsihrl~l) .rrc converted into the physical inqtallatio~~.u-cilchs 01' the type.5 CONTRACTING AND CONSTRUCTION MANAGEMENT While all project activities are directed towards a successtul coi~structlon imd (IF). once lie is elltrusted with a work.~ rlle services envisaged in the project report.lcl.2 Contractors' Role Contraclors are of various categories.lics. or incorpor. Some of theill are given helow \ * * Entnlst the total respcmsibility for engineering. and give each package to a competent conll. and (iii) construction. ~~ labour force and supervisors.l-i:fis.lntrotlurtbo to Project Malragenle~~t (C) Logistics planning Procuren~ent budgeting Imnplemnentation of the plans' Observance of legal requirenlel~ts and documenlation a (D) (E) (F) - ater rials Management (MM) MM covers storage x1. Contracting is the prcxess of establishing a relation between the owner alid tlil* corlt~ . cvery contractor becomes a providcl. ( i i su]j. u ~ d erectors with vast resources at their conunx~d: some are only supl)lic5r s auil erectors o f equipment: s o ~ n e others arc Illere constructors who provide ilieir o u ! c~luipnletlt.rc. 13.rkes the responsibility for the accon~plishment of the wol. procuremellt cost is necessnry for controlling the overall prolect cosl. It has Inally legal and colnnit. its handling calls for specialised knowledge and pract~cal expel ~ c ~ i c ~ 13. suppliers .~li(. supplies to one or more vendors and C O I I S ~ I .5.U L ~ I Oto II one or more contractors.d control of the tlow of materials troni UIC 011-site dclivery point to the sites of consumption. and then entrust engineering ~ I Csupervisio~~ ! 10 all engineering consultmt. * : V c c o n l p l i s h a portion i ) t the work yoursclt with your own ciepi1rt11ici1t~11 organisatloll and colitract out the balance to one or Incxe agellcle\ 13. 13. procureinenl ant1 L( ~ I I \ I USiIol]. IC I I III ' .)n.3 Types of Contract The popular lypes of contracts are * * .ror or a consortium of contractors. mainly construction.lcet\. Ruyr. Timely on-site delivery of materials to suit the construction schedulc w ~ l pr~~atly l avoid lilne overrun. capable of producmg the goods OI ~ ~ I I. clost. LO ensure suuc. luirrluyers.k c.~i~r-a\lc~tl LO him. procureineut . Q Efticient procurement and materials managemell1 are central to project \ucct3sv. Break down the total prc!ject into severill work packages witli or ~tllout engineering and design. or use.5. Turnkey contract Product-in-hand contract Remeasurement contract * .rlitl V M are tlle interface between the demand and supply of nia~t.0 1 ' \kill .uid lIlillll. S o n ~ are e specialised project designers.onl~ol 011 Appoximately 60 percent of the project cost is s p n t on ~naterials.~~ktl/or resources and undert.(l\lcl .~clor . matcr~als . Procure~nttl~l .rucl c .~~ss o f thc project.5. . tlic three major tasks in project implelnentation are : engineering. yet some others are Inere labour contractors. and therefore.1 Contracting Approach There are several approaches in contracting.. to execute the project work.

* Preparation of tender document. ' * * Award of Contract. such translation has to be within the scheduled time frame and estimated cost. the ownet's scope of CM would cover the management of the following aspects of implementation : * Construction planning and site mobilisation * . observing the specified quality standards. Tender opening. there can be some amount of overlapping of the scope of work between Project Management and Construction Management. Construction is the largest pmject phase and it encompasses all management practices which should be studied and planned in &tail before you launch the work.-- * * * * * * * Lump-sum works contract Item rate contract Cost-plus contract Piece rate wdrk Labour supply contract Hybrid contract Fixed price and variable price contract Project Management 13. * Determination of the contractor's capability to undertake the work package. * * * * Site prep&ation and setting up of temporary facilities to enable contractors' smooth working Building of site offices~and store sheds fot the owner Employees' township Transport Communication Canteens Statutory registrations Provision of fabrication and construction drawings and documents * * : * . the former functioning principally from the corporate office and the latter from the project site.5. Generally.5.6 Definition of CM's Scope Depending on the organisational structure and responsibility distribution of the enterprise.5. Incitation of the Tender. Approval. capable of producing or generating the product or service that is the end-result of the project. Tender submission. * * * * * * Pre-qualification of the contractors. 13. Construction management (CM) is the practice of the critical functions necessary to accomplish successfully the physical building of the project.4 Contracting Procedure The usual steps in contracting are as follow * WorkPackaging. Signing of agreement with detailed contract conditions. 13.5 Objective of Construction Management CM's sole objective is the translation of drawings and specifications into their material form. Evaluation and recommendation.Constructionscheduling / ' .

from the standards. The of : Estrrhlishing basic control process in any industrial activity is a three-step functio~ performance standards .Measuring the performance against the standards . Good rapport between the two is necessary for getting the best performance from the contractor which is iinportant for project success.. Contract documents must be drawn up nleticulously avoiding ambiguities and h~ilt-in disputes which may embitter the owner-contractor relationship..contractor relations Foro: account (departinental work) General office and site accounts Work supervision and field control Progress monitoring and reporting Accounting for materials Contracts administration Extra work and change orders Claims and disputes * * * * * * * * * * * * * * * * * In most cases.. project construction is entrusted to contractors who have the required skill. capable of producing or generating the project's end-product. specifications.Introduction to Project Management Sequencing of work Consuucticm budget control Control of construction schedules and milestone achievements Staffing and organisation Procedure manuals ~abo:r force planning Productivity Spot planning or micro planning at the site Materials planning Constructl.Correchng Deviations. calls for a great deal of seriousness on the part of the . experience and resources. materials and Inanpower into the physical facility.. if any.6 PROJECT CONTROL Here an effort has made to apply to the total project performance through proper controlling and information system with the necessary ch'mges during the course of execution.. Construction is the longest project phase . An owner might execute the project construction hinlself. but even then he may engage labour contractors. 13. cost and quality leading to project success.ik including heavy rigging studies Site fabrication Construction management Local purchases Repairs and rectification's Risk m'magement and insurance Safety and security Environmental care Industrial relations Law and order of site Contractors' working facilities Owner . Micro plans or detailed short-term plans are prepared at the site. service. Construction is the process of translating the plans. Controlling the factors of time.md the largest group of activities 11s macro plan or master construction schedule is prepared at headquarters.

and output information are used in time and cost control at various control prints. Various schedules used for Time and Cost control shall include the following : * * Master time schedule Engineering time schedule Procurelnent time scliedule Coilstruction time schedule Commissioning time schedule Schedule of e~igineering man-hours Schedule of procurement man days Schedule of project team man days Schedule of construction supervision man days Schedulc of direct field labour dgys Integrated schedule of critical equipment with time phased budgeted cost Integrated scbsdule of bulk inaterials with time phased budgeted cost lntegrated schedules of other equipment and materials with time phased budgeted cost Integrated schedulc of engineering by disciplines.6. important data are collected and suitably converted into +managementinformation and sent up for use in decision making. and the master budget on the other.Progress reports Repeatedly-reviewed and update completion forecast Targets of percentage coinple~ion per project day/week/month. The first major task in Time and Cost control is to plan and break down the project into sinall and manageable segments and develop from them the master scl~edule and milestone network on the one side. equipment and other resources schedules with i~ldividual budgeted costs Time phased budgets for corporate office expenditure.1 Time and Cost Control Tools and Techniques . with man-hours and time phased budgeted cost ' * * * * * * * * * * * * * Labour. basic data. design and drafting purchase ordering on-site deliveries of equipment and materials construction .ject performance. Project LMilal~agen~ent 13.management. technology acquisition and other sundry costs * Besides the above mentioned schedules of time and cost several other tools of assumptions. Some of these are enumerated below : * * . At different operating levels. These two are the major tools to control the time and cost factors of the pro. aimed at achieving the overall schedule Total project cost per project man-hour Total project cost per project day/ hour Total project cost per engineering man-hour Total project cost till the achievement of every important milestoile Progress build up curves for : - * * * * * * total project implementation engineering. It also requires the involvement of people at all organisational levels of the enterprise.

however. or lack of correct information. I~nportarlt points to be considered in the time crashlny drcislons are -as tollows : * Wether the toial project scbedule can be inlproved by crashing the schedule of one or two lnd~vidual tasks o r segments. as a result of which the owner or contractor pays considerable amount of crashlng coqt t o r n o corresponding benefit. and drafting procurement. and also on the ~nanagement's philosophy on controlling. by expenditure - * * Fund flow curve Contingency run down curve or chart The extent of control exercised and the type of control tools and data used for the purpose will depend on the size. indecision's and delayed decisions are generally attributable to lack o f comnn~ltrneut on the part of the executive responsible for decis~on ~ruking. completion. cysttrendreport. in making quick decisions on crashing.forecast report.2.ich. complexity and the category of the project. or mexpcl lrnce. manpower histogram. Lack of clarity on the extent ot authority and power also can contribute to the malady of indecision's.6. a project can fail because of wrong and/or delayed decisions. not letting the project suffer because of delayedldefective decision. In all cases.6. iuid bottleneck report. REVIEW Figure 13. funds and In spite of the best possible control system and the timely availability ot sulfic~ent resources. changes/contingency by rundown report. design.procurement. a monthly'tabular report on progress is a usual exercise.111trucluctir111 to Project Manage~ile~lt * Cost build up curves for - the total project engineering. 4 FEEDBACK -+ Identification with Reference to Objectives Decision and Evaluation of Their 1nlpact. the overall economy 1s not al~illysecl. .2 Decision Making as a Control Function The members of t'ae project organisatioqlmustknow the process of decision making and the impact of such decisions. They should make individuallteam decision in time. by commitment construction .2 :Decision Making Process 13.s Eliminatiori Process Approval anti Adoption . Generally.3 Time Crashing Economy Analysis Time crashing is one of the common decisions to put delayed projects hack on lr. It niay or niay not he accompanied by : (a) (b) (c) (d) (e) cost status report. Whilc wrony decisions mostly emanate from Ignorance. (0 13. The process is graphically explained in the Figure 13.

quality. social and envirollmental issues. From this overall. What is usually done is to identity the total risks. Insurable and uninsurable risks have to be categorised'and treated separately. Risk m. In measure of task performance contrt. there will be any otller kind of benefit like resources withdrawal possibility 'md clearing the depelldeilcies of other fast progressing tasks. Risk management strategies liavc to he forniulated for avoiding risk and reducing their impact. directing and controlling.iect overrun in terms nf time. and a.rhle risks liavc to be categorised and treated separately.\.%partfrom the financial benefits. analyse them nnd classify \hen] on the basis of their significance then take risk avoidance ru~d mitigation measures. These schedules are need for procuring ccluipment and materials. and Lhe like which .I nlust for the success of the project. construction-related risks and acts of Gtxl. operational aspects. Risk shall be analysed with reference to tlieir potential impact on the project and classified in the order of severity. organising the required resources and also to sequence and measure task perf(ir1uance. cost and yuality standard as envisage during the -preparation -of Detailed Project Report or Master Schedule. Tllose apart. taskwise a i d resourcewise consoliclated and detailed schedules are prepared. Wllether the product profit generated by the saving in project time would pay back the crashing cost. legal and regulatory controls. 13.l types. Some essential requi~enient of Project M. - IL should contain tile appropriate infornlation with required level of accuracy.~k.6. will there be any other econonlic or social benefit accruing from the crashing efforts ? 13..in overall plan is developed. ant1 out of tlle remaining insurable risks retain the insignificant onesto self as self-insurance or-include in contractors scope and filially transfer the serious ones to iilsurers under various classes of insurance policies. .stmtegy formulated for managing every class or category of potential risk separately. supply-related risks. botli predictable and unpredictable in character. organlsing. Information is made available through reports. running through the entirc life cycle of the proeject.* * * : Whether by shortening the schedule of olle or Inore individual tasks. 13. milestone achievement. social aspects and all other issues which are considered to have 'm impact on the project nlust be covered by the reporting systenl designed for the project.4 Information Reporting System Infor~natioo is the first requirement of all good decisions on pl'miing.6. An enterprise does not always insure against all types of losses and damage nor are all classes of risks insurable. there are several internal and exterllal risks of technical and legi. design-related risks. identifying all key tasks to be accomplished and nlilcstones to he acliicved with start a i d finish dates. based on experience and slalistics .5 Risk Management as a Control Function A project is exposed to several risks which include risks arising f r o ~ n market changes. human aspects.7 SUMMARY Thirlliillg ahead and Iooking ahead into the pro-ject implementation.ulagement stategies have to be forniulated for avoiding risk and reducing their impact. and a strategy forniulatetl for nlanaging every class or category of potential risk sep'arately. So an effective system to give illfornlation on all vital aspects in a structi~red ~naruler at daily/weekly/monthly frequency is . it shouldStrive to pinpoint niot causes with accuracy ancl even suggest tllc possible preventive/ corrective actions for lnanagemeiits consideration. inspection. Thcy include political and environlllental risks.a report on achievement arid deviations sliould be quick hitting. 11 - should elicit people's involvement at all levels. Considering the comparative economy of cost and benefit.ue more external to the enterprise than internal. is it worth resorting LO a time crashing exercise on the total project schedule ? .ulagemeut Information System is given below : .plays a vital role to cc!mbal the pro. Insurable and uninsur. Progress of work and adherence to schedule by all agencies resources utilisation. bottlenecks. Risk shall be analysed with reference to their potential impact on the project and classified in the order of severity.

(c) Scheduling is the succeeding activity of Programming and involvcs thc following steps : (1) Forward and backward scheduling (2) (3) Resource Assessment and Matching Preparation of Master Schedule and Master Budget Preparation of Coi~struction Schedule Preparation of Manpower Schedule Preparation of Ordering and Delivery Schedule for Plant . (1) (2) (3) (4) Bar Chart Precedence Diagram Network Critical Path Method Project Evaluation and review technique Line of Balance (5) / (b) An activity is any portion of a project which consumes tiine or resouices and has :I definable beginning and ending. A network is a graphical representation of a project plan showing Ule interrelation ofthe various activities. There are mainly three different forms of project organisatiotls.8 ANSWERS TO SAQs SAQ 1 (a) Projsct Management is a concept and tool which converts the prc ) I ~ L ' I abstraction into project reality channeling its endeavour through t l ~ c llollow major steps : (1) (2) Planning Programming Scheduling Organising Budgeting Controlling (3) (4) (5) (6) (b) Programming is the succeeding activity of Planning which ii~vol\~r's ~IIC' following steps (1) Listing of main work elements Definition of the work element Breaking down the work element in structured manner Codification of various work element Modeling the work element Fixation of sequence 'and priority Fixation of activity duration (2) (3) (4) (5) (6) (7) (8) Identification of critical activities.uld Equ~plnent (4) (5) (6) (d) (7) Making integratioq of all the schedule. machinery operation etc. paper work.I I I Introduction to Project Manngen~ent 13. Activities may involve li~l>ou~. v i 7 (1) Functional Organisation (2) (3) SAQ 2 (a) The main planning techniques used in Engineering Projects iirc : Divisional Organisation Matrix (-lrganisation. (c) . contractual negotiations.

(2) (3) . Monitoring of project progress and periodic updating. Scheduling and milestone network.(d) .)verall Planning. The main application of CPM are (I) Project Ma~~agement (.