PROJECT

MANAGEMENT

Asst. Prof. PRAVEEN KUMAR S

Sacred Heart Institute of Management Studies - SHIMS,
Sacred Heart College (Autonomous)
TIRUPATTUR- VELLORE.

PROJECT MANAGEMENT UNIT 4 – S P K

 UNIT – 4: DEVELOPING A PROJECT NETWORK

DEFINITION:
 A flowchart graphical depicts the sequence, interdependencies un
start finish times of the project job plan of activities critical path
through the network.
 Provides the basic for scheduling labor and equipment
 Provides an estimate for the project duration
 Provides the basis for budgeting cash flows

Developing Project Plan

A project plan takes into account the approach the team will take and
helps the team and stakeholders document decisions made regarding the
objective, scope, schedule, resources, and deliverables.

CONSTRUCTING A PROJECT NETWORK:

Constructing a Project Network
when organizing a work project, you must determine the most logical
order in which to complete the project activities. A useful tool in
documenting the workflow is called a network diagram. The network
diagram identifies the order in which the work will be completed using
logical relationships between the activities.

PROJECT MANAGEMENT UNIT 4 – S P K

CONSTRUCTING A PROJECT NETWORK:
ACTIVITY:
An element of the project that requires time.

MERGE ACTIVITY:
An activity that has two or more preceding activity on which
independence.

PARALLEL ACTIVITY:
An activities that can occur independently and if desire, at the same time
or not.

Path:
A sequence of connected dependent activities.
Critical path:
The longest path through the activity network that for completion of all
project related activities; it is also the shortest expected time in which the
entire project can be complete derives from the critical path will delay
complete the entire project.

Event:
A Point in time when an activity started.
Designates a point in time.

Burst activity:
 An activity that has more than one activity immediately following
(more than one dependences around) following for it.
 Network:

PROJECT MANAGEMENT UNIT 4 – S P K

  Shows the sequential relationships among activities using nodes
and arrows.

Activity-on-node (aon):
Node represent activities and arrows show precedence relationships.

Activity-on-arrow (aoa):
Arrows represent activities and nodes are events for points in time.

PERT
 Project Evaluation and Review Technique (PERT)
 The program (or project) evaluation and review technique (PERT)
is a statistical tool used in project management, which was
designed to analyze and represent the tasks involved in completing
a given project.
PERT Time Basic Measure
 PERT has defined three types of time required to accomplish an
activity:
 Optimistic time
 Pessimistic time
 Most likely time

CRITICAL PATH METHOD (CPM)

 The Critical Path Method (CPM), or Critical Path
Analysis (CPA), is an algorithm for scheduling a set of project
activities. A critical path is determined by identifying the longest
stretch of dependent activities and measuring the time required to
complete them from start to finish.

PROJECT MANAGEMENT UNIT 4 – S P K

Crashing of Project Network
 Crashing Project crashing is the method for shortening
the project duration by reducing the time of one or more critical
activities to less than their normal time. Crashing is achieved by
devoting more resources. Thus the cost associated with
the project is increased.

BASIC GUIDELINES TO FOLLOW IN DEVELOPING A

PROJECT NETWORKS:
 Networks critically flow from left to right.
 An activity cannot begun until all its activities are complete.
 Arrows indicate precedent and cross over each other.
 Identify with each activity unique number is greater than
predecessors.
 Looping is not possible.
 Conditional statements are not allowed.
 Use common start and stop nodes.

PROJECT MANAGEMENT UNIT 4 – S P K

CPM PERT

CPM Works with fixed deterministic PERT Works with

time. probabilistic time.

CPM is useful for repetitive and non- PERT is useful for non-
complex projects with a certain degree of repetitive and complex
time estimates. projects with uncertain time
estimates.

CPM includes time-cost trade off. PERT is restricted to time

variable.

CPM for construction projects. PERT used for R&D

programs.

PROJECT MANAGEMENT UNIT 4 – S P K

PROJECT MANAGEMENT UNIT 4 – S P K
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PROJECT MANAGEMENT UNIT 4 – S P K
RESOURCE LEVELING AND RESOURCE
ALLOCATION
 RESOURCE LEVELING
 Resource leveling is a technique used to examine unbalanced use
of resource (usually people or equipment) over time, and for
resolving over allocation or conflict resulting from scheduling
certain task simultaneously.
 RESOURCE ALLOCATION
 Resource allocation is the process of assigning and managing
assets in a manner that supports an organization's strategic
goals. Resource allocation includes managing tangible assets such
as hardware to make the best use of softer assets such as human
capital.

PROJECT MANAGEMENT UNIT 4 – S P K

HOW TO AVOID COST AND TIME OVERRUNS
 Pay a lot of attention to project planning, Use customized agile
PROJECT MANAGEMENT.
 Check a vendor's capabilities before hiring, Do proper R&D
 Attempt to stay within the scope that was originally planned,
Ensure consultant availability.
 Use good scheduling tools & charts.
 Make sure the stakeholders in the project are on the same page,
perform proper product testing.
 Constantly track and measure the progress, Have a solid risk
management procedure.

REASONS FOR COST AND TIME OVERRUNS

 Unplanned Costs
So many things can happen between the time a contract is signed and
when it is finally executed. And they can all influence the cost of
materials, equipment and labor and overhead, such as administrative,
finance and legal costs. Unplanned costs – whether they are unexpected
or overlooked – can bedevil any project.
Guard against this cost overrun by building reserves and regularly
checking material and supplier contracts against buying patterns, which
influence supply and demand, and therefore, costs. Successful project
managers not only produce project budget and spending outlooks; they
also check them constantly, says 4 Cast Plus, a project management
company. This goes for “any project-based industry, regardless of
whether you are in construction, IT or professional services,” the
company states.
 A Communication Breakdown
This can happen among any two people involved in a project, but the
miscommunication that could end up costing you money is most likely to
take place between the project manager and another employee in a key
role. You can’t possibly be in the same room for every meeting or listen

PROJECT MANAGEMENT UNIT 4 – S P K

in on every phone call, but you can be in the pipeline in other ways, so
that you can guard against one of the primary causes of cost escalation in
project management.
 Changes in Project Scope
It’s a rare project that gets smaller over time; a project almost always
grows, and with that growth, the costs. Many people defend “scope
creep,” saying that it should be expected, as a project begins to take
shape. Don’t fight it; embrace it, they say. In theory, you may agree, but
what about that burgeoning bottom line?
Guard against this cost overrun the only way possible: By setting strict
rules about how much change you will accept and by what date – and
then standing by your decision.
 Underestimating Project Difficulty or Complexity
It’s more likely to happen with big, expensive projects – the type with
hidden “surprises” that haven’t been unearthed yet, like building projects
that involve excavation work. But underestimation can impugn smaller
projects, too.
Guard against this cost overrun by ensuring that you hire bona
fide experts to undertake the initial review of your project. Of course,
even experts make mistakes, but those who have experience are more
likely to rely on their experience, as they consider “what if?” scenarios.
As the boss, it's always beneficial to visit projects similar to yours – and
take copious notes of what went right and what could have gone better, if
those project leaders knew then what they know now.
 Unrealistic Cost Estimates
Like sailing in a boat with a leaky bottom, setting sail on a project that
has been underbid virtually seals it for a budget overrun (unless cuts are
made in other places).
Guard against this cost overrun by putting your project in the hands of an
experienced hand right from the start and comparing the bid to the cost of
similar projects. Then ask your project leader to sit down and provide a
comprehensive breakdown of each component of the project and its

PROJECT MANAGEMENT UNIT 4 – S P K

associated costs. Such a disclosure can help expose even accidental
oversights.
 Lack of Leadership Experience
It can be painful to “point fingers,” but sometimes it can't be helped.
Small-business owners want, and are entitled to, accountability. So when
a project runs off the rails because of a lack of leadership on the part of
the project leader, it can be painfully obvious who is responsible. A lack
of project management experience can reveal itself in myriad ways: lack
of planning, poor communication, insubordination and missed or
unenforced deadlines, among them.
Guard against this cost overrun by hiring an experienced team leader,
who excels at communicating (with you) and who provides regular
project updates.

WAYS TO PREVENT COST AND TIME OVERRUNS

 Pay a lot of attention to project planning
Planning is the most essential component of project management and the
biggest weapon against cost overruns & delays. Think of all the major
scenarios and flesh out the complete scope of the project before a single
line is coded. Once the scope is defined, get a sign-off from all the
stakeholders.
 Check a vendor’s capabilities before hiring
In many complex projects, you might need to use outside vendors to do
part of the project tasks. Before you hire a vendor, pay an attention to the
following:
Find out their team’s capabilities and check if that matches your project
requirements. Improper skill-sets match can cause a significant drag in
your projects.
Find out if their cost estimates are realistic.
Check how good they are at sticking to deadlines in their previous
projects.

PROJECT MANAGEMENT UNIT 4 – S P K

  Attempt to stay within the scope that was originally
planned
Fighting scope creep is the biggest challenge for a project manager. The
developers want to add their favorite features, the clients start asking for
things that were not originally planned and the testing team wants a
change in some of the features. Sounds familiar? While some of the
changes might be called for, drastic scope creep that put the project in
danger. It is essential to exert control and convince all the stakeholders
why the increased scope can harm the project.
 Use good scheduling tools & charts
Proper scheduling is a must in complex projects. Improper scheduling can
cause wrong cost estimations and increase the idle times of some of the
team members. You could use a simple Gantt chart or look for more
advanced project scheduling tools to help you with scheduling. Read our
earlier article on charting tools you could use for project management.
 Make sure the stakeholders in the project are on the
same page
Effective communication can help reduce the delays by avoiding working
on wrong things and making the scheduling work better. As a project
manager, it is your responsibility to keep the communication among the
team members work seamlessly. Read our earlier article on best practices
in stakeholder communication.
 Constantly track and measure the progress
You can’t improve what you don’t measure. A project manager has to
constantly track the progress of the various tasks and have various
metrics to measure in the projects. This will provide early signals of
project delays, while also giving you opportunities to fix the issues before
they boil over.

PROJECT MANAGEMENT UNIT 4 – S P K

PROJECT APPRAISAL
 Critical examination of the project from all aspects is called
appraisal.
 Analysis of prospective costs and benefits that leads to desirability
for committing resources.

STEPS IN PROJECT APPRASIAL:

 Define the problem
 Preliminary inspection and plan the work.
 Data collection and analysis
 Applying the cost approach,
 Apply the direct comparison approach.
 Apply the income approach
 Final estimate.
 Write the appraisal report.

PROJECT MANAGEMENT UNIT 4 – S P K

FACTORS TO CONSIDER IN PROJECT APPRAISAL PROCESS
 Project Introduction
 Market Feasibility
 Project Particulars
 Techno-Environmental Aspects
 Financial Analysis
 Project Conclusion

PROJECT CONTROL
 Project controls are the data gathering, management and
analytical processes used to predict, understand and constructively
influence the time and cost outcomes of a project or program.
 Through the communication of information in formats that assist
effective management and decision making.

PROJECT CONTROL PROCESS (PCP)

 Project Planning
 Project Execution
 Project Evaluation

PROJECT CONTROL STEPS:

 Developing a project strategy and project outcomes.
 Development, update and maintenance, scheduling (for the PM
software).
 Estimating project cost, engineering cost, assigning project value.
 Managing risk.

PROJECT MANAGEMENT UNIT 4 – S P K

  Assessing and analyzing project risk and cataloguing past risk and
how to avoid future risk.
 Earned schedule and earned value management, including both
work and organizational breakdown structure.
 controlling project documentation
 Diagnosing project scheduling and costs with forensics assessment
procedure.
 Oversize and quality assessment of supply materials.
 Comprehensive integration of the elements of control and other
domains of project management.

PROJECT AUDIT
The project audit is a thorough examination of the management of a
project, its methodology and procedures, its records, its properties, its
budgets and expenditures, and its degree of completion.
It provides an opportunity to uncover the issues, concerns and challenge
encountered in the execution of a project.
Regardless of whether the project audit is conducted mid-term on a
project or at its conclusion, the process is similar.
 Current status of the project
 Future status
 Status of crucial tasks
 Risk assessment
 Information pertinent to other projects
 Limitations of the audit

PROJECT MANAGEMENT UNIT 4 – S P K

PROJECT AUDIT PROCESS (PAP)
 Planning
 Design
 Fieldwork
 Reporting & recommendations
 Corrective actions

PROJECT MANAGEMENT UNIT 4 – S P K

PROJECT CLOSURE
 The Project Closure Phase is the fourth and last phase in
the project life cycle.
 Project Closure involves handing over the deliverables to your
customer, passing the documentation to the business, cancelling
supplier contracts, releasing staff and equipment, and informing
stakeholders of the closure of the project.

PROJECT CLOSURE:
 Write performance feedback for all project members.
 Review performance feedback with team managers.
 Provide feedback to team member’s manager.
 Ensure all project accounting is complete.
 Assist with personal re-assignment with require.

PROJECT MANAGEMENT UNIT 4 – S P K

SEVEN ACTIVITIES OF PROJECT COSURE:
 Perform project close out.
 Perform client close out.
 Perform organizational close out.
 Conduct sub-contractual close out.
 Perform final risk assessment.
 Write project final report.
 Conduct team close out.

PROJECT MANAGER EVALUATION (PME)

 A project manager's performance evaluations are necessary to
ensure the company's success.
 It is necessary to look at three fundamentals of classical
management: plan, execute, and control.
 It is ultimately the project manager who is responsible for
ensuring whether a project is completed successfully and on time.

PROJECT MANAGEMENT UNIT 4 – S P K