C09
Upcoming SlideShare
Loading in...5
×
 

C09

on

  • 305 views

 

Statistics

Views

Total Views
305
Views on SlideShare
305
Embed Views
0

Actions

Likes
0
Downloads
3
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    C09 C09 Presentation Transcript

    • Chapter 9Project Management
    • Lecture Outline• Project Planning• Project Scheduling• Project Control• CPM/PERT• Probabilistic Activity Times• Microsoft Project• Project Crashing and Time-Cost Trade-offCopyright 2011 John Wiley & Sons, Inc. 9-2
    • Project Management Process• Project • unique, one-time operational activity or effortCopyright 2011 John Wiley & Sons, Inc. 9-3
    • Project Management ProcessCopyright 2011 John Wiley & Sons, Inc. 9-4
    • Project Management ProcessCopyright 2011 John Wiley & Sons, Inc. 9-5
    • Project Elements• Objective• Scope• Contract requirements• Schedules• Resources• Personnel• Control• Risk and problem analysisCopyright 2011 John Wiley & Sons, Inc. 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 teamCopyright 2011 John Wiley & Sons, Inc. 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 projectCopyright 2011 John Wiley & Sons, Inc. 9-8
    • Work Breakdown Structure• Work breakdown structure (WBS) • Breaks a project into components, subcomponents, activities, and tasksCopyright 2011 John Wiley & Sons, Inc. 9-9
    • Work Breakdown Structure for Computer Order Processing System ProjectCopyright 2011 John Wiley & Sons, Inc. 9-10
    • Responsibility Assignment Matrix• Organizational Breakdown Structure (OBS) • a chart that shows which organizational units are responsible for work items• Responsibility Assignment Matrix (RAM) • shows who is responsible for work in a projectCopyright 2011 John Wiley & Sons, Inc. 9-11
    • Responsibility Assignment MatrixCopyright 2011 John Wiley & Sons, Inc. 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 processCopyright 2011 John Wiley & Sons, Inc. 9-13
    • Project Scheduling• Steps • Techniques • Define activities • Gantt chart • Sequence activities • CPM/PERT • Estimate time • Software • Develop schedule • Microsoft ProjectCopyright 2011 John Wiley & Sons, Inc. 9-14
    • Gantt Chart• Graph or bar chart• Bars represent the time for each task• Bars also indicate status of tasks• Provides visual display of project schedule• Slack • amount of time an activity can be delayed without delaying the projectCopyright 2011 John Wiley & Sons, Inc. 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 MonthCopyright 2011 John Wiley & Sons, Inc. 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 variationCopyright 2011 John Wiley & Sons, Inc. 9-17
    • Project Control• Quality management• Communication• Enterprise project managementCopyright 2011 John Wiley & Sons, Inc. 9-18
    • CPM/PERT• Critical Path Method (CPM) • DuPont & Remington-Rand • Deterministic task times • Activity-on-node network construction• Project Evaluation and Review Technique (PERT) • US Navy and Booz, Allen & Hamilton • Probabilistic task time estimates • Activity-on-arrow network constructionCopyright 2011 John Wiley & Sons, Inc. 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 projectCopyright 2011 John Wiley & Sons, Inc. 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 5Copyright 2011 John Wiley & Sons, Inc. 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 relationshipCopyright 2011 John Wiley & Sons, Inc. 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 carpetCopyright 2011 John Wiley & Sons, Inc. 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 monthsCopyright 2011 John Wiley & Sons, Inc. 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 monthsCopyright 2011 John Wiley & Sons, Inc. 9-25
    • Node Configuration Activity Earliest Earliest number start finish 1 0 3 3 0 3 Activity Latest Latest duration start finishCopyright 2011 John Wiley & Sons, Inc. 9-26
    • Activity Scheduling• Earliest start time (ES) • earliest time an activity can start • ES = maximum EF of immediate predecessors• Forward pass • starts at beginning of CPM/PERT network to determine earliest activity times• Earliest finish time (EF) • earliest time an activity can finish • earliest start time plus activity time • EF= ES + tCopyright 2011 John Wiley & Sons, Inc. 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 9Start 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 Copyright 2011 John Wiley & Sons, Inc. 9-28
    • Activity Scheduling• Latest start time (LS) • Latest time an activity can start without delaying critical path time • LS= LF - t• Latest finish time (LF) • latest time an activity can be completed without delaying critical path time • LF = minimum LS of immediate predecessors• Backward pass • Determines latest activity times by starting at the end of CPM/PERT network and working forwardCopyright 2011 John Wiley & Sons, Inc. 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 9Start 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 Copyright 2011 John Wiley & Sons, Inc. 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 PathCopyright 2011 John Wiley & Sons, Inc. 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 estimateCopyright 2011 John Wiley & Sons, Inc. 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 TimeCopyright 2011 John Wiley & Sons, Inc. 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 2,2,2Copyright 2011 John Wiley & Sons, Inc. 9-34
    • Activity Time Estimates TIME ESTIMATES (WKS) MEAN TIME VARIANCE ACTIVITY a m b t б2 1 6 8 10 8 0.44 2 3 6 9 6 1.00 3 1 3 5 3 0.44 4 2 4 12 5 2.78 5 2 3 4 3 0.11 6 3 4 5 4 0.11 7 2 2 2 2 0.00 8 3 7 11 7 1.78 9 2 4 6 4 0.44 10 1 4 7 4 1.00 11 1 10 13 9 4.00Copyright 2011 John Wiley & Sons, Inc. 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 0Copyright 2011 John Wiley & Sons, Inc. 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 16Copyright 2011 John Wiley & Sons, Inc. 9-37
    • Total Project Variance 2 = б22 + б52 + б82 + б112  = 1.00 + 0.11 + 1.78 + 4.00 = 6.89 weeksCopyright 2011 John Wiley & Sons, Inc. 9-38
    • CPM/PERT With OM ToolsCopyright 2011 John Wiley & Sons, Inc. 9-39
    • Probabilistic Network Analysis Determine probability that project is completed within specified time x- Z=  where = tp = project mean time = project standard deviation x= proposed project time Z= number of standard deviations that x is from the meanCopyright 2011 John Wiley & Sons, Inc. 9-40
    • Normal Distribution of Project Time Probability Z  = tp x TimeCopyright 2011 John Wiley & Sons, Inc. 9-41
    • Southern TextileWhat is probability that project is completed within 30 weeks? P(x  30 weeks) x-  = 6.89 weeks 2 Z=   = 6.89 = 30 - 25 2.62  = 2.62 weeks = 1.91  = 25 x = 30 Time (weeks) From Table A.1, (appendix A) a Z score of 1.91 corresponds to a probability of 0.4719. Thus P(30) = 0.4719 + 0.5000 = 0.9719Copyright 2011 John Wiley & Sons, Inc. 9-42
    • Southern TextileWhat is probability that project is completed within 22 weeks? P(x  22 weeks) 0.3729 = 0.1271 x-  = 6.89 weeks 2 Z=   = 6.89 = 22 - 25 2.62  = 2.62 weeks = -1.14 x = 22  = 25 Time (weeks) From Table A.1, (appendix A) a Z score of 1.14 corresponds to a probability of 0.3729. Thus P(22) = 0.5000 - 0.3729 = 0.1271Copyright 2011 John Wiley & Sons, Inc. 9-43
    • Microsoft Project• Popular software package for project management and CPM/PERT analysis• Relatively easy to useCopyright 2011 John Wiley & Sons, Inc. 9-44
    • Microsoft Project Click on “Tasks” First step; Start DateCopyright 2011 John Wiley & Sons, Inc. 9-45
    • Microsoft Project Click on “Format” then ”Timescale” to scale Gantt chart. Gantt chart; Precedence click on “View” Create precedence relationships to activate relationships; click on predecessor activity, then holding “Ctrl” Key, click on successor activity.Copyright 2011 John Wiley & Sons, Inc. 9-46
    • Microsoft Project Click on “View” then Network Diagram Critical path in redCopyright 2011 John Wiley & Sons, Inc. 9-47
    • Microsoft Project – Zoom ViewCopyright 2011 John Wiley & Sons, Inc. 9-48
    • Microsoft Project – Task Information Enter % completionCopyright 2011 John Wiley & Sons, Inc. 9-49
    • Microsoft Project – Degree of Completion Activities 1, 2 and 3 Black bars show 100% complete degree of completionCopyright 2011 John Wiley & Sons, Inc. 9-50
    • PERT Analysis with Microsoft Project Click on PERT Entry Sheet to enter 3 time estimates Click on PERT calculator to compute activity durationCopyright 2011 John Wiley & Sons, Inc. 9-51
    • PERT Analysis with Microsoft ProjectCopyright 2011 John Wiley & Sons, Inc. 9-52
    • PERT Analysis with Microsoft ProjectCopyright 2011 John Wiley & Sons, Inc. 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 costCopyright 2011 John Wiley & Sons, Inc. 9-54
    • Project Network – Building a House 2 4 12 8 7 1 4 12 6 3 5 4 4 4Copyright 2011 John Wiley & Sons, Inc. 9-55
    • Normal Time and Cost vs. Crash Time and Cost $7,000 – $6,000 – Crash cost $5,000 – Crashed activity Slope = crash cost per week $4,000 – $3,000 – Normal activity Normal cost $2,000 – $1,000 – Crash time Normal time – | | | | | | | 0 2 4 6 8 10 12 14 WeeksCopyright 2011 John Wiley & Sons, Inc. 9-56
    • Project Crashing TOTAL NORMAL CRASH ALLOWABLE CRASH TIME TIME NORMAL CRASH CRASH TIME COST PERACTIVITY (WEEKS) (WEEKS) COST COST (WEEKS) WEEK 1 12 7 $3,000 $5,000 5 $400 2 8 5 2,000 3,500 3 500 3 4 3 4,000 7,000 1 3,000 4 12 9 50,000 71,000 3 7,000 5 4 1 500 1,100 3 200 6 4 1 500 1,100 3 200 7 4 3 15,000 22,000 1 7,000 $75,000 $110,700Copyright 2011 John Wiley & Sons, Inc. 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 $200Copyright 2011 John Wiley & Sons, Inc. 9-58
    • Time-Cost Relationship• Crashing costs increase as project duration decreases• Indirect costs increase as project duration increases• Reduce project length as long as crashing costs are less than indirect costsCopyright 2011 John Wiley & Sons, Inc. 9-59
    • Time-Cost Tradeoff Minimum cost = optimal project time Total project cost Indirect cost Cost ($) Direct cost Crashing Time Project durationCopyright 2011 John Wiley & Sons, Inc. 9-60
    • Copyright 2011 John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that permitted in section 117 of the 1976 United States Copyright Act without express permission of the copyright owner is unlawful. Request for further information should be addressed to the Permission Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or 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 herein.Copyright 2011 John Wiley & Sons, Inc. 6-61