Professional Documents
Culture Documents
Project Management
Lecture Outline
• Project Planning
• Project Scheduling
• Project Control
• CPM/PERT
• Probabilistic Activity Times
• Microsoft Project
• Project Crashing and Time-Cost Trade-off
9-2
Project Management Process
• Project
• unique, one-time operational activity or effort
9-3
Project Management Process
9-4
Project Management Process
9-5
Project Elements
• Objective
• Scope
• Contract requirements
• Schedules
• Resources
• Personnel
• Control
• Risk and problem analysis
9-6
Project Team and Project Manager
• Project team
• made up of individuals from various areas and
departments within a company
• Matrix organization
• a team structure with members from functional
areas, depending on skills required
• Project manager
• most important member of project team
9-7
Scope Statement
• Scope statement
• a document that provides an understanding,
justification, and expected result of a project
• Statement of work
• written description of objectives of a project
9-8
Work Breakdown Structure
9-9
Work Breakdown Structure for Computer Order
Processing System Project
9-10
Responsibility Assignment Matrix
9-11
Responsibility Assignment Matrix
9-12
Global and Diversity Issues in Project
Management
• Global project teams are formed from different
genders, cultures, ethnicities, etc.
• Diversity among team members can add an
extra dimension to project planning
• Cultural research and communication are
important elements in the planning process
9-13
Project Scheduling
• Steps • Techniques
• Define activities • Gantt chart
• Sequence activities • CPM/PERT
• Estimate time • Software
• Develop schedule • Microsoft Project
9-14
Gantt Chart
• Slack
• amount of time an activity can be delayed without
delaying the project
9-15
Example of Gantt Chart
Month
0 | 2 | 4 | 6 | 8 | 10
Activity
Design house
and obtain
financing
Lay foundation
Order and
receive
materials
Build house
Select paint
Select carpet
Finish work
1 3 5 7 9
Month
9-16
Project Control
• Time management
• Cost management
• Performance management
• Earned Value Analysis – standard procedure to
• numerically measure a project’s progress
• forecast its completion date and cost
• measure schedule and budget variation
9-17
Project Control
• Quality management
• Communication
• Enterprise project management
9-18
CPM/PERT
9-19
Project Network
• Activity-on-node (AON)
• nodes represent activities Branch Node
• arrows show precedence 1 2 3
relationships
• Activity-on-arrow (AOA)
• arrows represent activities
• nodes are events for
points in time
• Event
• completion or beginning
of an activity in a project
9-20
AOA Project Network for a House
3
Lay Dummy
foundation
2 0 Build Finish
3 1 house work
1 2 4 6 7
Design house Order and 3 1
and obtain receive 1 1
Select Select
financing materials paint carpet
5
9-21
Concurrent Activities
• Dummy
• two or more activities cannot share same start and
end nodes
3
Lay foundation Lay
Dummy
foundation
2 0
2 3
1
Order material 2 4
Order material
(a) Incorrect precedence (b) Correct precedence
relationship relationship
9-22
AON Network for House Building
Project
Lay Build
foundation house
Activity Number
2 4
Activity Time
2 3
Start 1 7
3 1
Finish work
Design house 3 5 6
and obtain
1 1 1
financing
Order &receive Select Select
materials paint carpet
9-23
Critical Path
2 4
2 3
Start 1 7
3 1
3 5 6
1 1 1
A: 1-2-4-7
3 + 2 + 3 + 1 = 9 months Critical path
B: 1-2-5-6-7 Longest path through a
3 + 2 + 1 + 1 + 1 = 8 months network
C: 1-3-4-7
3 + 1 + 3 + 1 = 8 months Minimum project
D: 1-3-5-6-7 completion time
3 + 1 + 1 + 1 + 1 = 7 months
9-24
Activity Start Times
Start at 5 months
2 4
2 3 Finish at 9 months
Start 1 7
Finish
3 1
3 5 6
1 1 1
Start at 3 months Start at 6 months
9-25
Node Configuration
1 0 3
3 0 3
9-26
Activity Scheduling
9-27
Earliest Activity Start and Finish Times
Lay foundation
Build house
2 3 5
4 5 8
2
3
Finish work
1 0 3 7 8 9
Start
1 1
Design house
and obtain 6 6 7
financing 3 3 4
1
1 5 5 6
Select carpet
Order and 1
receive materials
Select paint
9-28
Activity Scheduling
9-29
Latest Activity Start and Finish Times
Lay foundation
Build house
2 3 5
4 5 8
2 3 5
3 5 8 Finish work
1 0 3 7 8 9
Start
1 0 3 1 8 9
Design house
and obtain 6 6 7
financing 3 3 4
1 6 7
1 4 5 5 5 6
Select carpet
Order and 1 6 7
receive materials
Select paint
9-30
Activity Slack
Activity LS ES LF EF Slack S
*1 0 0 3 3 0
*2 3 3 5 5 0
3 4 3 5 4 1
*4 5 5 8 8 0
5 6 5 7 6 1
6 7 6 8 7 1
*7 8 8 9 9 0
* Critical Path
9-31
Probabilistic Time Estimates
• Beta distribution
• probability distribution traditionally used in CPM/PERT
a + 4m + b
Mean (expected time): t=
6
2
b-a
Variance: 2 = 6
where
a = optimistic estimate
m = most likely time estimate
b = pessimistic time estimate
9-32
Examples of Beta Distributions
P(time)
P(time)
a m t b a t m b
Time Time
P(time)
a m=t b
Time
9-33
Project with Probabilistic Time
Estimates
Equipment Equipment testing
installation and modification
1 4 System Final
6,8,10 2,4,12 training debugging
System 10
development 8
Manual 3,7,11 1,4,7
Start 2 testing Finish
3,6,9
5 11
Position 2,3,4 9 1,10,13
recruiting 2,4,6
Job Training System
3 6 System changeover
1,3,5 3,4,5 testing
Orientation
7
2,2,2
9-34
Activity Time Estimates
9-35
Activity Early, Late Times & Slack
ACTIVITY t б ES EF LS LF S
1 8 0.44 0 8 1 9 1
2 6 1.00 0 6 0 6 0
3 3 0.44 0 3 2 5 2
4 5 2.78 8 13 16 21 8
5 3 0.11 6 9 6 9 0
6 4 0.11 3 7 5 9 2
7 2 0.00 3 5 14 16 11
8 7 1.78 9 16 9 16 0
9 4 0.44 9 13 12 16 3
10 4 1.00 13 17 21 25 8
11 9 4.00 16 25 16 25 0
9-36
Earliest, Latest, and Slack
Critical Path 2-5-8-11
1 0 8 4 8 13
8 1 9 5 16 21
10 13 17
16
1 0 3
8 9
2 0 6 Finish
Start 7 9 16
6 0 6 9
5 6 11 16 25
3 6 9 9 9 13
9 16 25
4 12 16
3 0 3 6 3 7
3 2 5 4 5 9
7 3 5
2 14 16
9-37
Total Project Variance
9-38
CPM/PERT With OM Tools
9-39
Probabilistic Network Analysis
9-40
Normal Distribution of Project Time
Probability
Z
= tp x Time
9-41
Southern Textile
P(x 30 weeks)
x-
2
= 6.89 weeks Z=
= 6.89 = 30 - 25
2.62
= 2.62 weeks
= 1.91
= 25 x = 30 Time (weeks)
9-42
Southern Textile
What is probability that project is completed within 22 weeks?
P(x 22 weeks) 0.3729
= 0.1271 x-
2
= 6.89 weeks Z=
= 6.89 = 22 - 25
2.62
= 2.62 weeks
= -1.14
x = 22 = 25 Time (weeks)
9-43
Microsoft Project
9-44
Microsoft Project
Click on “Tasks”
First step;
Start Date
9-45
Microsoft Project
Gantt chart;
Precedence click on “View”
Create precedence relationships to activate
relationships;
click on predecessor
activity, then
holding “Ctrl” Key,
click on successor
activity.
9-46
Microsoft Project
Critical path
in red
9-47
Microsoft Project – Zoom View
9-48
Microsoft Project – Task Information
Enter % completion
9-49
Microsoft Project – Degree of Completion
9-50
PERT Analysis with Microsoft Project
Click on PERT Entry
Sheet to enter 3
time estimates
Click on PERT
calculator to compute
activity duration
9-51
PERT Analysis with Microsoft Project
9-52
PERT Analysis with Microsoft Project
9-53
Project Crashing
• Crashing
• reducing project time by expending additional
resources
• Crash time
• an amount of time an activity is reduced
• Crash cost
• cost of reducing activity time
• Goal
• reduce project duration at minimum cost
9-54
Project Network – Building a House
2 4
12
8
7
1 4
12
6
3 5 4
4 4
9-55
Normal Time and Cost
vs. Crash Time and Cost
$7,000 –
$6,000 –
Crash cost
$5,000 – Crashed activity
Normal cost
$2,000 –
$1,000 –
Crash time Normal time
– | | | | | | |
0 2 4 6 8 10 12 14 Weeks
9-56
Project Crashing
TOTAL
NORMAL CRASH ALLOWABLE CRASH
TIME TIME NORMAL CRASH CRASH TIME COST PER
ACTIVITY (WEEKS) (WEEKS) COST COST (WEEKS) WEEK
9-57
$500 $7000
4
2
$7000
FROM …
8 12
7 Project Duration:
1 4
12
36 weeks
$400 3 6
4 5 4
4 $200
$3000
$200
$500 $7000
2 4
TO… 8 12 $7000
7
Project Duration: 1 4
31 weeks 7
Additional Cost:
$400 3 6
$2000
4 5 4
4 $200
$3000
$200
9-58
Time-Cost Relationship
9-59
Time-Cost Tradeoff
Indirect cost
Cost ($)
Direct cost
Crashing Time
Project duration
9-60
Copyright 2011 John Wiley & Sons, Inc.
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6-61