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Lecture Operations and supply chain management: The Core (3/e) – Chapter 5: Projects

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The main goals of this chapter are to: Explain what project management is and why it is important, identify the different ways projects can be structured, describe how projects are organized into major subprojects, understand the concept of earned value management,...

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Projects

Chapter 05

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Learning Objectives

1. Explain what project management is and why it is

important.

2. Identify the different ways projects can be structured.

3. Describe how projects are organized into major

subprojects.

4. Understand the concept of Earned Value

Management.

5. Determine the “critical path” for a project.

6. Show how activity time uncertainty can be analyzed

in projects.

7. Demonstrate how to “crash,” or reduce the length, of

a project.

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Project Management

 What is a project?

major output and requiring a significant period of time

to perform.

 What is project management?

equipment, material, etc.) to meet the technical, cost, and time constraints of the project.

 Why is project management important?

often involves juggling a portfolio of projects.

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Types of Development Projects

Type of

Project

Degree of Change

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Project Structure

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Defining the Project

 Statement of Work

 A written description of the objectives to be achieved

 Task

 A further subdivision of a project – usually shorter than several months and performed by a single group or organization

 A group of activities combined to be assignable to a single

organizational unit

 Project Milestone

 Specific events in the life of the project

 Work Breakdown Structure

 Defines the hierarchy of project tasks, subtasks, and work packages

 Activities

 Pieces of work that consume time

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Project Control Charts

 Charts provide an

easily understood

visual presentation

 Software can be used

to create the charts

 Gantt chart – shows

in a graphic manner

the amount of time

involved and the

sequence of activities

Often referred to as a

bar chart.

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Earned Value Management

(EVM)

 A technique for measuring project progress in

an objective manner

 Has the ability to combine measurements of scope, schedule, and cost in a project

 Provides a method for evaluating the relative success of a project at a point in time

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Earned Value Management –

Essential Features

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Network-Planning Models

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Critical Path Method (CPM)

Excel: Critical Paths

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Project Crashing

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Project Crashing

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Project Crashing

Activity D cannot be

reduced any further

at this point

Activity A cannot be

reduced any further

at this point

Project has reached minimum duration

Excel: Project Crashing

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Managing Resources

 In addition to scheduling tasks, resources

must also be assigned to specific tasks

 Software can be used to spot over-allocation

 When resources are over-allocated, either

more resources are required or rescheduling

is necessary

resources

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