Lecture Fundamentals of operations management (4/e): Chapter 4 - Davis, Aquilano, Chase

Chapter supplement 3 Project management, after studying this chapter you will be able to: Recognize that project management involves both people skills to coordinate and motivate individuals from a range of disciplines and technical skills to properly plan and schedule a project, explain the role of the project manager in organizing and coordinating all activities performed in a project, introduce critical path scheduling as a tool for identifying activities that require immediate attention,...

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Management 4e 

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S3–3

Definition of Project Management

Definition of Project Management

• Project

–Series of related jobs or tasks focused on the

completion of an overall objective.

• Project Management

–Planning, directing, and controlling resources to

meet the technical, cost, and time constraints of the project.

• Program

–Synonym for a project, although it also can

consist of several interrelated projects.

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–A group of activities combined to be assignable

to a single organizational unit.

• Milestones

–Specific events to be reached at points in time.

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S3–5

Work Breakdown Structure

Work Breakdown Structure

• Work Breakdown Structure

–Method by which a project is divided into tasks

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S3–6 Exhibit S3.1

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• Make them of manageable size.

• Give authority to carry out the program.

• Monitor and measure the program.

• Provide the required measures.

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• Role of the Project Manager

–Using social and technical skills to manage

across traditional functional lines to create a collaborative culture.

• High-Performance Project Teams

–Creating a successful team requires

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S3–9

Organizational Considerations in  Project Management (cont’d)

Organizational Considerations in  Project Management (cont’d)

• Barriers to High Team Performance:

–Different points of view

–Role conflicts

–Power struggles

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S3–10

Project Control

Project Control

• Gantt Chart

–Graphical technique that shows the amount of

time required for each activity and the sequence

in which the activities are to be performed.

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S3–11

Gantt Chart

Gantt Chart

Exhibit S3.2A

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S3–12

Total Program Cost Breakdown

Total Program Cost Breakdown

Exhibit S3.2B

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S3–13

Divisional Breakdown of Costs and Labor Hours

Divisional Breakdown of Costs and Labor Hours

Exhibit S3.2C

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S3–14

Cost and Performance Tracking Schedule

Cost and Performance Tracking Schedule

Exhibit S3.2D

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S3–15

Bar/Milestone Chart

Bar/Milestone Chart

Exhibit S3.2E

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–The technique developed by the U.S Navy for

planning the Polaris missile project.

• CPM (Critical Path Method)

–Technique developed by J E Kelly and M

R.Walker to schedule preventative maintenance shutdowns of chemical processing plants.

• 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).

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–Tasks must be independent of each other.

–Job or tasks are ordered such that each must

follow a particular or given sequence.

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S3–18

CPM Key Terms

CPM Key Terms

• Slack Time

– The amount of time the starting of an activity

can be delayed without affecting the earliest

completion date of the overall project.

• Early start (ES): the earliest possible time an

activity can begin.

• Early finish time (EF): the early start time plus the

time need to complete the activity.

• Late finish time (LF): the latest time an activity can

end without delaying the project.

• Late start time (LS): the late finish time minus the

time needed to complete the activity.

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S3–19

CPM with a Single Time Estimate

CPM with a Single Time Estimate

Step 1: Identify all project activities.

Step 2: Sequence activities and construct

network.

Step 3: Determine the critical path.

Step 4: Determine slack times.

Step 4.1: Find the EF and ES for each

activity.

Step 4.2: Find the LS and LF for each

activity.

Step 4.3: Determined the total slack time

for each activity.

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S3–20

CPM Network for Computer Design Project

CPM Network for Computer Design Project

Exhibit S3.3

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S3–21

CPM Key Terms (cont’d)

CPM Key Terms (cont’d)

• Early Start Schedule

–The earliest time that each activity in the project

can be started.

• Late Start Schedule

–The latest start time that each activity can be

started without affecting the overall completion time.

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S3–22

CPM Network for Computer Design Project

CPM Network for Computer Design Project

Exhibit S3.4

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S3–23

CPM with Three Activity Time Estimates

CPM with Three Activity Time Estimates

Step 1: Identify activities

Step 2: Sequence activities and construct network

Step 3: Determine the three time estimates for

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S3–24

Typical Beta Curves

Typical Beta Curves

Exhibit S3.5

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6

a b

Exhibit S3.6

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S3–26

CPM with Three Activity Time Estimates

CPM with Three Activity Time Estimates

Step 6: Identify all of the paths in the network and their

estimated completion times and variances

Exhibit S3.7

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S3–27

CPM with Three Activity Time Estimates

CPM with Three Activity Time Estimates

Step 7: Determine the probability of completing the

project by a certain date

p

p

ET

D Z

D = Desired completion date for the project

ETp = Expected completion time for the path

σp = Standard deviation for the path

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S3–28

Probability of Each Path Being  Completed in 39 Weeks or Less

Probability of Each Path Being  Completed in 39 Weeks or Less

Exhibit S3.8a

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S3–31

Time­Cost Trade­off Models

Time­Cost Trade­off Models

• Time-Cost Trade-off Model

–A model that develops the relationship between

direct project costs, indirect costs, and time to complete the project by minimizing the sum of direct and indirect costs.

• Crash Costs

–The additional costs of an activity when time to

complete it is shortened.

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(or crash) each activity

Step 3: Compute the critical path

Step 4: Shorten the critical path at the least cost

Step 5: Plot project direct, indirect, and total-cost curves

and find the minimum-cost schedule

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S3–33 Exhibit S3.10

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S3–36

Plot of Costs and Minimum Cost Schedule

Plot of Costs and Minimum Cost Schedule

Exhibit S3.13