7. Project Management
Transcript of 7. Project Management
OPERATIONSOPERATIONSMANAGEMENTMANAGEMENT
OO MMPP“PROJECT
MANAGEMENT”By: -By: -
HAKEEM–UR–REHMANHAKEEM–UR–REHMANPCBA–UCPPCBA–UCP
WHAT IS A PROJECT?WHAT IS A PROJECT?““Non – Routine, one time effort, limited by time Non – Routine, one time effort, limited by time and resources, and performance specifications and resources, and performance specifications designed to meet customer needs.”designed to meet customer needs.”
(or)(or)
““Special operations designed to accomplish a set of Special operations designed to accomplish a set of objectives in a limited time frame.”objectives in a limited time frame.”
WHAT IS PROJECT WHAT IS PROJECT MANAGEMENT?MANAGEMENT?
Project management is “the application of Project management is “the application of knowledge, skills, tools, and techniquesknowledge, skills, tools, and techniques to to project activities in order to meet or exceed project activities in order to meet or exceed stakeholder needs and expectations from a stakeholder needs and expectations from a project”.project”.
PROJECT MANAGEMENT TOOLS PROJECT MANAGEMENT TOOLS AND TECHNIQUESAND TECHNIQUES
Good project management deals with Good project management deals with three three factors: time, cost and performance.factors: time, cost and performance.
Some specific ones includeSome specific ones include Gantt charts, PERT charts, critical path analysis Gantt charts, PERT charts, critical path analysis
(time)(time) Cost estimates and Earned Value Analysis (cost)Cost estimates and Earned Value Analysis (cost)
Work Breakdown Structure (WBS)Work Breakdown Structure (WBS) ““A hierarchical method that successively subdivides A hierarchical method that successively subdivides
the work of the project into smaller details.”the work of the project into smaller details.” Such a structure defines tasks that can be Such a structure defines tasks that can be
completed independently of other tasks, facilitating completed independently of other tasks, facilitating resource allocation, assignment of responsibilities, resource allocation, assignment of responsibilities, and measurement and control of the project.and measurement and control of the project.
Work Breakdown Structure Work Breakdown Structure (WBS) DIAGRAM(WBS) DIAGRAM
WORK BREAKDOWN STRUCTURE OUTLINEWORK BREAKDOWN STRUCTURE OUTLINE
Level 1Level 1 Level 2Level 2 Level 3Level 3Task 1Task 1
Subtask 1.1Subtask 1.1
Work Package 1.1.1Work Package 1.1.1
Work Package 1.1.1Work Package 1.1.1
Work Package 1.1.1Work Package 1.1.1
Subtask 1.2Subtask 1.2
Work Package 1.2.1Work Package 1.2.1
Work Package 1.2.2Work Package 1.2.2
Work Package 1.2.3Work Package 1.2.3
Task 2Task 2
Subtask 2.1Subtask 2.1
Work Package 2.1.1Work Package 2.1.1
Work Package 2.1.2Work Package 2.1.2
Work Package 2.1.3Work Package 2.1.3
GANTT CHART
Graph or bar chart with a bar for each project activity that shows passage of time Provides visual display of project scheduleProvides visual display of project schedule Slack: amount of time an activity can be delayed without delaying the project
| | | | |Activity
Design house and obtain financing
Lay foundation
Order and receive materials
Build house
Select paint
Select carpet
Finish work
0 2 4 6 80 2 4 6 8 10 10MonthMonth
MonthMonth11 33 55 77 99
Basic Rules: Developing a project Basic Rules: Developing a project networknetwork
Eight Rules Apply:Eight Rules Apply:
1.1. Networks typically flow from left to right.Networks typically flow from left to right.2.2. An Activity cannot begin until all preceding activities have An Activity cannot begin until all preceding activities have
been completed.been completed.3.3. Arrows on networks indicate precedence and flow. Arrows can Arrows on networks indicate precedence and flow. Arrows can
cross over each other.cross over each other.4.4. Each activity should have a unique identification number.Each activity should have a unique identification number.5.5. An activity identification number must be larger than that of An activity identification number must be larger than that of
any activities preceding it.any activities preceding it.6.6. Looping in not allowed (in other words recycling through a set Looping in not allowed (in other words recycling through a set
of activities cannot take place).of activities cannot take place).7.7. Conditional statements are not allowed (i.e. this type of Conditional statements are not allowed (i.e. this type of
statement should not appear: if successful, do something; if statement should not appear: if successful, do something; if not, do nothing)not, do nothing)
8.8. When there are multiple starts, a common start node can be When there are multiple starts, a common start node can be used to indicate a clear project beginning on the network. used to indicate a clear project beginning on the network. Similarly, a single project end, node can be used to indicate a Similarly, a single project end, node can be used to indicate a clear ending. clear ending.
CONSTRUCTING A CONSTRUCTING A PROJECT NETWORKPROJECT NETWORK
ActivityActivity An element of the project that require time; may or may not required resources An element of the project that require time; may or may not required resources Description of activities should use verb/noun format; develop project Description of activities should use verb/noun format; develop project
specificationsspecifications Merge ActivityMerge Activity
More than one activity immediately preceding it ( more than one arrow flowing to More than one activity immediately preceding it ( more than one arrow flowing to it)it)
Parallel ActivitiesParallel Activities Activities that can take place at the same time, if the manager wishes; may or Activities that can take place at the same time, if the manager wishes; may or
may not occur simultaneously may not occur simultaneously PathPath
A sequence of connected, dependent activitiesA sequence of connected, dependent activities Critical PathCritical Path
Longest path (s) through the network; if an activity on the path is delayed, the Longest path (s) through the network; if an activity on the path is delayed, the project is delayed the same amount of time.project is delayed the same amount of time.
EventEvent A point in time when the activity is started or finished; does not consume time A point in time when the activity is started or finished; does not consume time
Burst ActivityBurst Activity More than one activities immediately following it ( more than one dependency More than one activities immediately following it ( more than one dependency
arrow flowing from it)arrow flowing from it) Dummy ActivityDummy Activity
A dummy activity, which is normally depicted by a dashed arrow, consumes no A dummy activity, which is normally depicted by a dashed arrow, consumes no time or resources.time or resources.
Activity–On–Arc Network Activity–On–Arc Network Fundamentals Fundamentals
Predecessor, Successor & Concurrent or Parallel activitiesPredecessor, Successor & Concurrent or Parallel activities
A1 2
B C
A is preceded by nothing
B is preceded by A
C is preceded by B
(A)
X1
Y
Z
Y and Z are preceded by X
Y and Z can begin at the same time, if you wish
(B)
Activity – On – Arc Network Activity – On – Arc Network Fundamentals Fundamentals
Predecessor, Successor & Concurrent or Parallel activitiesPredecessor, Successor & Concurrent or Parallel activities
J
1K
L
J,K & L can begin at the same time, if you wish (they need not occur simultaneously)
(C)
X
Y
Z
(D)
M
All (J,K,L) must be completed before M can begin
1
AA
Z is preceded by X and Y
‘AA’ is preceded by X and Y
Activity – On – Arc Network Activity – On – Arc Network Fundamentals Fundamentals
Predecessor, Successor & Concurrent or Parallel activitiesPredecessor, Successor & Concurrent or Parallel activities
Use of Dummy activity:
1. Activity ‘C’ can start immediately after ‘A’ and ‘B’ are completed.
2. Activity ‘E’ can start immediately after only ‘B’ is completed.
1
2
A C
B E
D
Here, ‘D’ is a Dummy Activity.
Example: (AOA Example: (AOA Network)Network)
Consider the following data:Consider the following data:
ActivityActivity Description Description Immediate Immediate Predecessor(s)Predecessor(s)
AA Select administrative and medical staffSelect administrative and medical staff --
BB Select site and do site surveySelect site and do site survey --
CC Select equipmentSelect equipment AA
DD Prepare final construction plans and layoutPrepare final construction plans and layout BB
EE Bring utilities to the site Bring utilities to the site BB
FF Interview applicants and fill positions in Interview applicants and fill positions in nursing, support staff, maintenance, & nursing, support staff, maintenance, & securitysecurity
AA
GG Purchase and take delivery of equipmentPurchase and take delivery of equipment CC
HH Construct the hospitalConstruct the hospital DD
II Develop an information systemDevelop an information system AA
JJ Install the equipmentInstall the equipment E, G, HE, G, H
KK Train nurses and support staffTrain nurses and support staff F, I, JF, I, JDraw the AOA network Diagram.
AOA Network:AOA Network:
1
2
4
3
5 6
7
8
9
A
B
C
D
H
E
I
G
F
K
Dummy
J
QUESTIONQUESTION
ActivityActivity Description Description Immediate Immediate Predecessor(s)Predecessor(s)
AA Procurement of parts for sub – assembly ‘1’Procurement of parts for sub – assembly ‘1’ NoneNone
BB Procurement of parts for sub – assembly ‘2’Procurement of parts for sub – assembly ‘2’ NoneNone
CC Procurement of parts for sub – assembly ‘3’Procurement of parts for sub – assembly ‘3’ None None
DD Building sub – assembly ‘1’ Building sub – assembly ‘1’ AA
EE Building sub – assembly ‘2’Building sub – assembly ‘2’ BB
FF Building sub – assembly ‘4’Building sub – assembly ‘4’ D,ED,E
GG Building sub – assembly ‘3’Building sub – assembly ‘3’ B,CB,C
HH Building the final product Building the final product F,GF,G
II Final TestFinal Test HH
Develop the network by yourself.
In 1957 the In 1957 the Critical Path Method (CPM)Critical Path Method (CPM) was developed as a was developed as a network model for project management. network model for project management. CPM is a CPM is a deterministic method that uses a fixed time estimate for deterministic method that uses a fixed time estimate for each activity. each activity. While CPM is easy to understand and use, it While CPM is easy to understand and use, it does not consider the time variations that can have a does not consider the time variations that can have a great impact on the completion time of a complex project.great impact on the completion time of a complex project.
The The Program Evaluation and Review Technique (PERT)Program Evaluation and Review Technique (PERT) is a is a network model that allows for randomness in activity network model that allows for randomness in activity completion timescompletion times.. PERT was developed in the late 1950's PERT was developed in the late 1950's for the U.S. Navy's Polaris project having thousands of for the U.S. Navy's Polaris project having thousands of
contractors. It has the potential to reduce both the time contractors. It has the potential to reduce both the time and cost required to complete a project.and cost required to complete a project.
PROGRAM/PROJECT EVALUATION & PROGRAM/PROJECT EVALUATION & REVIEW TECHNIQUE (REVIEW TECHNIQUE (PERTPERT)) & &CRITICAL PATH METHOD (CRITICAL PATH METHOD (CPMCPM))
CPM: EXAMPLECPM: EXAMPLECPM NetworkCPM Network
11 88
22
66
44
33
77
a, 6a, 6
f, 15f, 15
b, 8b, 8
c, 5c, 5e, 9e, 9
d, 13d, 13
g, 17g, 17 h, 9h, 9
i, 6i, 6
j, 12j, 12
55
Activity-on-Arc Network Activity-on-Arc Network FundamentalsFundamentals
Performing few simple computations allows PM to Performing few simple computations allows PM to
complete a process know as complete a process know as Forward and Backward Forward and Backward
PassPass
FORWARD PASS – EARLIEST TIMESFORWARD PASS – EARLIEST TIMES
1.1. How soon can the activity start? (early start – ES)How soon can the activity start? (early start – ES)
2.2. How soon can the activity finish? (early finish – EF)How soon can the activity finish? (early finish – EF)
3.3. How soon can the project be finished? (expected time – ET)How soon can the project be finished? (expected time – ET)
BACKWARD PASS – LATEST TIMESBACKWARD PASS – LATEST TIMES
1.1. How late can the activity start? (late start – LS)How late can the activity start? (late start – LS)
2.2. How late can the activity finish? (late finish – LF)How late can the activity finish? (late finish – LF)
3.3. Which activities represent critical path (CP)? This is the longest Which activities represent critical path (CP)? This is the longest
path in the network which, when delayed, will delay the projectpath in the network which, when delayed, will delay the project
4.4. How long can the activity be delayed? (slack or float – SL)How long can the activity be delayed? (slack or float – SL)
CPM ExampleCPM ExampleES and EF TimesES and EF Times
11 88
22
66
44
33
77
a, 6a, 6a, 6a, 6
f, 15f, 15f, 15f, 15
b, 8b, 8b, 8b, 8
c, 5c, 5c, 5c, 5
e, 9e, 9e, 9e, 9
d, 13d, 13d, 13d, 13
g, 17g, 17g, 17g, 17 h, 9h, 9h, 9h, 9
i, 6i, 6i, 6i, 6
j, 12j, 12j, 12j, 12
55
0 6
0 8
0 5
5 14
8 21 21 33
6 23 21 30
23 29
6 21
Project’s EF = 33Project’s EF = 33
Activity-on-Arc Network Activity-on-Arc Network FundamentalsFundamentals
Backward Pass – Latest Times; similar to Backward Pass – Latest Times; similar to
Forward Pass; remember three things:Forward Pass; remember three things:
1.1.SubtractSubtract activity times along each path activity times along each path
starting with the project end activity (LF – Dur. starting with the project end activity (LF – Dur.
= LS)= LS)
2.2.CarryCarry the LS to the next preceding activity to the LS to the next preceding activity to
establish its LF, establish its LF, unlessunless
3.3.Next preceding activity is a Next preceding activity is a burstburst activity; activity;
select the smallest LS of all its immediate select the smallest LS of all its immediate
successor activities to establish its LFsuccessor activities to establish its LF
CPM ExampleCPM ExampleCPM ExampleCPM Example LS and LF TimesLS and LF Times
11 88
22
66
44
33
77
a, 6a, 6a, 6a, 6
f, 15f, 15f, 15f, 15
b, 8b, 8b, 8b, 8
c, 5c, 5c, 5c, 5
e, 9e, 9e, 9e, 9
d, 13d, 13d, 13d, 13
g, 17g, 17g, 17g, 17
h, 9h, 9h, 9h, 9
i, 6i, 6i, 6i, 6
j, 12j, 12j, 12j, 12
55
0 6
0 8
0 5
5 14
8 21 21 33
6 23
21 30
23 29
6 21
3 9
0 8
7 12
12 21
21 33
27 33
8 21
10 27
24 33
9 24
Activity-on-Arc Network Activity-on-Arc Network FundamentalsFundamentals
Slack or Float – SLSlack or Float – SL
Forward & Backward Passes ComputedForward & Backward Passes Computed
Possible to determine which activities can Possible to determine which activities can
be delayed by computing “Slack” or “Float”be delayed by computing “Slack” or “Float”
LS – ES = SLLS – ES = SL
LF – EF = SLLF – EF = SL
Total Slack: tells us the amount of time an Total Slack: tells us the amount of time an
activity can be delayed; not delay projectactivity can be delayed; not delay project
CPM ExampleCPM ExampleCPM ExampleCPM ExampleSLACKSLACK
11 88
22
66
44
33
77
a, 6a, 6a, 6a, 6
f, 15f, 15f, 15f, 15
b, 8b, 8b, 8b, 8
c, 5c, 5c, 5c, 5e, 9e, 9e, 9e, 9
d, 13d, 13d, 13d, 13
g, 17g, 17g, 17g, 17
h, 9h, 9h, 9h, 9
i, 6i, 6i, 6i, 6
j, 12j, 12j, 12j, 12
55
0 6
0 8
0 5 5 14
8 21 21 33
6 23
21 30
23 29
6 21
3 9
0 8
7 12 12 21
21 33
27 33
8 21
10 27
24 33
9 24
3 4
3
3
4
0
0
7 7
0
CPMCPM ExampleExampleCRITICAL PATHCRITICAL PATH
11 88
22
66
44
33
77
a, 6a, 6a, 6a, 6
f, 15f, 15f, 15f, 15
b, 8b, 8b, 8b, 8
c, 5c, 5c, 5c, 5
e, 9e, 9e, 9e, 9
d, 13d, 13d, 13d, 13
g, 17g, 17g, 17g, 17 h, 9h, 9h, 9h, 9
i, 6i, 6i, 6i, 6
j, 12j, 12j, 12j, 12
55
CPM ExampleCPM ExampleCritical Path:Critical Path:
1 1 3 3 7 7 8 8
Activities on the Critical Path:Activities on the Critical Path:
bb d d j j
Total Project Time:Total Project Time:
8+13+12 = 8+13+12 = 3333
PRACTICE QUESTIONPRACTICE QUESTION
Network InformationNetwork Information
Country Engineers Design DepartmentCountry Engineers Design Department
ACTIVITYACTIVITY DESCRIPTIONDESCRIPTION PROCEDING PROCEDING ACTIVITYACTIVITY
ACTIVITY TIMEACTIVITY TIME
(Duration)(Duration)
AA Application Application ApprovalApproval
NoneNone 55
BB Construction Construction PlansPlans
AA 1515
CC Traffic StudyTraffic Study AA 1010
DD Service Service Availability Availability CheckCheck
AA 55
EE Staff ReportStaff Report B,CB,C 1515
FF Commission Commission ApprovalApproval
B,C,DB,C,D 1010
GG Wait for Wait for ConstructionConstruction
FF 170170
HH OccupancyOccupancy E,GE,G 3535
Program/Project Program/Project Evaluation & Review Evaluation & Review Technique (PERT)Technique (PERT)
The technique is based on the The technique is based on the assumption that an activity’s duration assumption that an activity’s duration follows a probability distribution instead follows a probability distribution instead of being a single value.of being a single value.
The probabilistic information about the The probabilistic information about the activities is translated into probabilistic activities is translated into probabilistic information about the project.information about the project.
PERTPERTThree time estimates are required to compute the Three time estimates are required to compute the
parameters of an activity’s duration distribution:parameters of an activity’s duration distribution:
Pessimistic TimePessimistic Time (t (tp p )) - the - the longest time that an activity might longest time that an activity might requirerequire. Three standard deviations from the mean is commonly . Three standard deviations from the mean is commonly used for the pessimistic time.used for the pessimistic time.
Most Likely TimeMost Likely Time (t (tm m ) -) - the the completion time having the highest completion time having the highest probabilityprobability. Note that this time is different from the expected time. Note that this time is different from the expected time
Optimistic TimeOptimistic Time (t (to o )) - - generally the shortest time in which the generally the shortest time in which the activity can be completedactivity can be completed. It is common practice to specify . It is common practice to specify optimistic times to be three standard deviations from the mean optimistic times to be three standard deviations from the mean so that there is approximately a 1% chance that the activity will so that there is approximately a 1% chance that the activity will be completed within the optimistic time.be completed within the optimistic time.
BETA PROBABILITY BETA PROBABILITY DISTRIBUTION WITH THREE DISTRIBUTION WITH THREE
TIME ESTIMATESTIME ESTIMATES
PERTPERT
PERT assumes a beta probability distribution for the time PERT assumes a beta probability distribution for the time estimates. For a beta distribution, the expected time and estimates. For a beta distribution, the expected time and variance for each activity can be:variance for each activity can be:
Expected time = ( Optimistic + 4 x Most likely + Pessimistic Expected time = ( Optimistic + 4 x Most likely + Pessimistic ) / 6) / 6
ttee = ( t = ( too + 4t + 4tmm + t + tp p ) / 6) / 6
Variance = [ (Pessimistic – Optimistic) / 6 ] Variance = [ (Pessimistic – Optimistic) / 6 ] 22
VVtt = [ ( t = [ ( tpp - t - to o ) / 6 ] ) / 6 ] 22
PERT : EXAMPLE PERT : EXAMPLE
Immed. Optimistic Most Likely Immed. Optimistic Most Likely PessimisticPessimistic
ActivityActivity Predec.Predec. Time (Hr.Time (Hr.) ) Time (Hr.)Time (Hr.) Time (Hr.)Time (Hr.) A -- 4 6 8A -- 4 6 8B -- 1 4.5 5B -- 1 4.5 5C A 3 3 3C A 3 3 3
D A 4 5 6 D A 4 5 6 E A 0.5 1 1.5E A 0.5 1 1.5 F B,C 3 4 5F B,C 3 4 5 G B,C 1 1.5 5G B,C 1 1.5 5 H E,F 5 6 7H E,F 5 6 7 I E,F 2 5 8I E,F 2 5 8 J D,H 2.5 2.75 4.5J D,H 2.5 2.75 4.5 K G,I 3 5 7K G,I 3 5 7
PERT : EXAMPLEPERT : EXAMPLEPERT NETWORKPERT NETWORK
AA
DD
CC
BBFF
EE
GG
II
HH
KK
JJ
PERT : EXAMPLEPERT : EXAMPLE ActivityActivity Expected TimeExpected Time VarianceVariance
A A 6 6 4/9 4/9 B B 4 4 4/9 4/9 C C 3 0 3 0 D D 5 5 1/9 1/9 E E 1 1 1/36 1/36 F F 4 4 1/9 1/9 G G 2 2 4/9 4/9 H H 6 6 1/9 1/9 I I 5 1 5 1 J J 3 3 1/9 1/9 K K 5 5 4/9 4/9
SOLUTIONSOLUTION EARLIEST/LATEST TIMES:EARLIEST/LATEST TIMES:
ActivityActivity ESES EFEF LSLS LFLF SlackSlack A 0 6 0 6 0 *criticalA 0 6 0 6 0 *critical B 0 4 5 9 5 B 0 4 5 9 5
C 6 9 6 9 0 *C 6 9 6 9 0 * D 6 11 D 6 11 15 20 915 20 9 E E 6 7 6 7 12 13 6 12 13 6
F 9 F 9 13 9 13 9 13 0 *13 0 *
G 9 G 9 11 11 16 18 716 18 7 H 13 H 13 19 19 14 20 114 20 1 I I 13 13 18 18 13 18 0 *13 18 0 * J J 19 19 22 22 20 23 120 23 1 K K 18 18 23 23 18 23 0 *18 23 0 *
PERT : EXAMPLEPERT : EXAMPLE
Activities on the Critical Path:Activities on the Critical Path:
AA C C F F I I K K
Total Project Time:Total Project Time:
6+3+4+5+5 = 6+3+4+5+5 = 2323
PERT : EXAMPLEPERT : EXAMPLE ActivityActivity Expected TimeExpected Time VarianceVariance
A A 6 6 4/9* 4/9* B B 4 4 4/9 4/9 C C 3 0* 3 0* D D 5 5 1/9 1/9 E E 1 1 1/36 1/36 F F 4 4 1/9* 1/9* G G 2 2 4/9 4/9 H H 6 6 1/9 1/9 I I 5 1* 5 1* J J 3 3 1/9 1/9 K K 5 5 4/9* 4/9*
PERT : EXAMPLEPERT : EXAMPLEProbability the project will be completed within Probability the project will be completed within
24 hours24 hoursVVpathpath = V = VAA + V + VCC + V + VFF + V + VII + V + VKK
= 4/9 + 0 + 1/9 + 1 + 4/9 = 4/9 + 0 + 1/9 + 1 + 4/9 = 2= 2pathpath = 1.414 = 1.414
Expected Time = EExpected Time = EAA + E + ECC + E + EFF + E + EII + E + EKK
= 6 + 3 + 4 + 5 + 5= 6 + 3 + 4 + 5 + 5 = 23= 23What is the probability that the project will be What is the probability that the project will be
completed within the 24 hours?completed within the 24 hours?
zz = (24 - 23)/ = (24 - 23)/(24-23)/1.414 = .71(24-23)/1.414 = .71
PERT : EXAMPLEPERT : EXAMPLE
Probability the project will be completed within 24 hoursProbability the project will be completed within 24 hours
From the Standard Normal Distribution table: From the Standard Normal Distribution table: P(z P(z << .71) = .5 + .2612 = .7612 .71) = .5 + .2612 = .7612
2323 2424
..50005000
..26122612
PRACTICE QUESTIONPRACTICE QUESTIONA medical institute is planning to hold an annual conference on A medical institute is planning to hold an annual conference on
eradication of cancer. In order to coordinate the project, it was eradication of cancer. In order to coordinate the project, it was decided to use PERT network. The major activities and time decided to use PERT network. The major activities and time estimates a, m, and b for each activity are carefully computed and estimates a, m, and b for each activity are carefully computed and gives as follows.gives as follows.ActivitiesActivities PredecessorsPredecessors EstimatesEstimates
aa mm bb
AA -- 22 44 1212
BB -- 1010 1212 2626
CC AA 88 99 1010
DD AA 1010 1515 2020
EE AA 77 7.57.5 1111
FF B, CB, C 99 99 99
GG DD 33 3.53.5 77
HH E, F, GE, F, G 55 55 551) Draw the PERT diagram for the project. 2) Compute Expected Time and
Variance for each activity. 3) Compute ES, EF, LS, LF and Slack time.
4) Identify the critical path and find its length and variance. 5) What is the probability that the project will be completed within 30 days?
QUESTIONQUESTIONSS