Lecture 9

1. School of Business – Operations and Project Management; Topic 9: Project Management
Course Week [Term]
Operations and Project Management
Topic 9: Project Management

2. School of Business – Operations and Project Management; Topic 9: Project Management
Learning outcomes:
What is project management?
How are projects planned and controlled?
What is network planning?
Learning Outcomes

3. School of Business – Operations and Project Management; Topic 9: Project Management
Project Management
• Project
o
Series of related jobs or tasks focused on the completion of an overall objective.
• Project Management
o
Planning, directing, and controlling resources to meet the technical, cost, and time constraints of the project.
• Program
o
Synonym for a large project, although it also can consist of several interrelated projects.

4. School of Business – Operations and Project Management; Topic 9: Project Management
Projects
Unique, one-time operations designed to accomplish a specific set of
objectives in a limited time frame.

5. School of Business – Operations and Project Management; Topic 9: Project Management
Project Management
• How is it different?
o
Limited time frame
o
Narrow focus, specific objectives
o
Less bureaucratic
• Why is it used?
o
Special needs
o
Pressures for new or improved products or services

6. School of Business – Operations and Project Management; Topic 9: Project Management
The Three Project Objectives of Quality, Cost and Time
Quality
TimeCost
New aircraft
project
Music festival
Fixed grant
research project

7. School of Business – Operations and Project Management; Topic 9: Project Management
Project Management
• What are the Key Metrics
o
Time
o
Cost
o
Performance objectives
• What are the Key Success Factors?
o
Top-down commitment
o
Having a capable project manager
o
Having time to plan
o
Careful tracking and control
o
Good communications

8. School of Business – Operations and Project Management; Topic 9: Project Management
Key Decisions
• Deciding which projects to implement
• Selecting a project manager
• Selecting a project team
• Planning and designing the project
• Managing and controlling project resources
• Deciding if and when a project should be terminated

9. School of Business – Operations and Project Management; Topic 9: Project Management
Project Manager
Responsible for:
•Work
•Quality
•Human Resources
•Time
•Communications
•Costs

10. School of Business – Operations and Project Management; Topic 9: Project Management
Stages in Project Management
Figure 16.3 The project management model
Understanding the
project environment
Project definition
Project planning
Changes
Corrective
action
Project controlTechnical execution
Stage
1
Stage
2
Stage
3
Stage
4
Stage
5

11. School of Business – Operations and Project Management; Topic 9: Project Management
Project Life Cycle
Concept
FeasibilityFeasibility
PlanningPlanning
ExecutionExecution
TerminationTermination
Management

12. School of Business – Operations and Project Management; Topic 9: Project Management
Work Breakdown Structure
Method by which a project is divided into tasks and subtasks.
Project XProject X
Level 1
Level 2
Level 3
Level 4

13. School of Business – Operations and Project Management; Topic 9: Project Management
WBS House Project
CivilCivil
Walls/RoofWalls/RoofFoundationFoundation SewerageSeweragePipingPiping
ElectricalElectrical
AppliancesAppliancesWiringWiring
PlumbingPlumbing
HouseHouse

14. School of Business – Operations and Project Management; Topic 9: Project Management
Figure 9.14 WBS Sub-Division by Numbering System
Civil
1.1.0
Civil
1.1.0
Walls/Roof
1.1.2
Walls/Roof
1.1.2
Foundation
1.1.1
Foundation
1.1.1
Sewerage
1.2.2
Sewerage
1.2.2
Piping
1.2.1
Piping
1.2.1
Electrical
1.3.0
Electrical
1.3.0
Appliances
1.3.2
Appliances
1.3.2
Wiring
1.3.1
Wiring
1.3.1
Plumbing
1.2.0
Plumbing
1.2.0
House
1.0.0
House
1.0.0Level 0
Level 2
Level 1

15. School of Business – Operations and Project Management; Topic 9: Project Management
Work Breakdown Structure
Figure 16.7 A work breakdown structure for a simple domestic project
Produce
boiled egg
Produce
boiled egg
Obtain
egg cup
Obtain
egg cup
Produce
toast
Produce
toast
Obtain
butter
Obtain
butter
Obtain plates
and cutlery
Obtain plates
and cutlery
Obtain
tray
Obtain
tray
Obtain
egg
Obtain
egg
Obtain
water
Obtain
water
Obtain
bread
Obtain
bread
Arrange trayArrange trayProduce
buttered toast
Produce
buttered toast
Produce boiled
egg in egg cup
Produce boiled
egg in egg cup
Produce glass of
orange drink
Produce glass of
orange drink
Serve breakfast in
bed
Serve breakfast in
bed
Obtain juiceObtain juice Obtain
glass
Obtain
glass

16. School of Business – Operations and Project Management; Topic 9: Project Management
Work Breakdown Structure (Continued)
Work breakdown structure for a project to design an information interface for a new
sales knowledge management system in an insurance company.
Training Installation Testing
Design information
interface for new sales
knowledge management
system
Form and
train user
group
Install
systems
Specify
sales
training
Design
initial
screen
interface
Test
interface
in pilot
area
Modify
interface

17. School of Business – Operations and Project Management; Topic 9: Project Management
Gantt Chart
Move in/startup
Remodel and install
phones
Select and order
furniture
Hire and train staff
Interview staff
Locate new facilities

18. School of Business – Operations and Project Management; Topic 9: Project Management
Gantt Charts
A Gantt chart for the project to design an information interface for a new sales knowledge management system in an
insurance company
a Form and train user group
b Install systems
c Specify sales training
d Design initial screen interface
e Test interface in pilot area
f Modify interface
0 10 20 30 40 50 60
Activity
Time (days)

19. School of Business – Operations and Project Management; Topic 9: Project Management
Hammocked Barchart
Activity Description
Mon
1
Tue
2
Wed
3
Thu
4
Fri
5
Sat
6
Sun
7
Mon
8
Tue
9
Wed
10
Thu
11
Fri
12
Sat
13
Sun
14
Mon
15
Lay Foundations
Dig Footings
Throw concrete
Build Walls
Brickwork
Fit Windows
Fit Roof
Fit Roof Trusses
Fit Tiles

20. School of Business – Operations and Project Management; Topic 9: Project Management
The Network Diagram
• Network (precedence) diagram – diagram of project activities that shows sequential relationships by the use of
arrows and nodes.
• Activity-on-arrow (AOA) – a network diagram convention in which arrows designate activities.
• Activity-on-node (AON) – a network diagram convention in which nodes designate activities.
• Activities – steps in the project that consume resources and/or time.
• Events – the starting and finishing of activities, designated by nodes in the AOA convention.

21. School of Business – Operations and Project Management; Topic 9: Project Management
Project Network – Activity on Arrow
Figure 17.4
2
1
3
4
5 6
Locate
facilities
Order
furniture
Furniture
setup
Interview
Hire and
train
Remodel
Move in
AOA

22. School of Business – Operations and Project Management; Topic 9: Project Management
Project Network – Activity on Node
Figure 17.4
AON
1
S
3
2
5
6
Locate
facilities
Order
furniture
Furniture
setup
Interview
Remodel
Move in
4
Hire and
train
7

23. School of Business – Operations and Project Management; Topic 9: Project Management
Activities in Series

24. School of Business – Operations and Project Management; Topic 9: Project Management
Figure 10.2 Activities in Parallel
A400 (Task4)
PLUMBING
A500 (Task 5)
ELECTRICAL
A600 (Task 6)
PAINTING
A600 (Task 3)
ROOF

25. School of Business – Operations and Project Management; Topic 9: Project Management
CPM
• CPM (Critical Path Method)
o
Identifies the longest time-consuming path through a network of tasks required to complete a project (i.e., the
shortest time in which the project can be completed).

26. School of Business – Operations and Project Management; Topic 9: Project Management
Example 1
2
1
3
4
5 6
8 weeks
6 weeks
3 weeks
4 weeks
9 weeks
11 weeks
1 week
Locate
facilities
Order
furniture
Furniture
setup
In
terview
Hire
and
train
Remodel
Move in
Time estimates
Figure 17.5

27. School of Business – Operations and Project Management; Topic 9: Project Management
Example 1 Solution
Path
Length
(weeks)
Slack
1-2-3-4-5-6 18 2
1-2-5-6 20 0
1-3-5-6 14 6
Critical Path

28. School of Business – Operations and Project Management; Topic 9: Project Management
Essential Work to be Completed for Next Week
• Please consult the OLE for details of the:
o
Seminar preparation work*
o
Essential readings*
o
Recommended readings
o
Further readings
*Essential readings and seminar preparation work MUST always be completed in time for the next seminar

29. School of Business – Operations and Project Management; Topic 9: Project Management
References

30. School of Business – Operations and Project Management; Topic 9: Project Management
End of presentation