Project Management

Lecture-FinalDr. Biswajit Sarkar

Dept. of Industrial & Management EngineeringHanyang University

South Korea

Books Reference

• 1. Analysis of Manufacturing Systems

by J. E. Rooda and J. Vervoort

• 2. Production/ Operations Management by William J. Stevenson, IRWIN publisher, ISBN 0-256-13900-8

Content

• 1. Basic of Project Management

• 2. PERT (Program Evaluation and Review Technique)

• 3. CPM (Critical Path Method)

Behavior Aspects

• Project management differs from management of more

traditional activities mainly because of its limited time

framework and the unique set of activities involved, which

gives rise to a host of rather unique problems.

• This describes the nature of projects and their behavioral

implications.

• This will pay special attention to the role of the project

manager.

The Project Manager

• The central figure in a project is the project manager. He or she bears

the ultimate responsibility for the success or failure of the project. The

role of the project manager is one of an organizer-a person who is

capable of working through others to achieve the objectives of project.

• Once the project is underway, the project manager is responsible for

effectively managing each of the following:

• The work, so that all of the necessary activities are accomplished in

the desired sequence.

• The human resources, so that those working on the project have

direction and motivation.

• Communications, so that everybody has the information they need to

do their work.

• Quality, so that performance objectives are realized.

• Time, so that the project can be completed on a time.

• Costs, so that the project is completed within budget.

The Importance of Working on Projects

• People are selected to work on special projects because the knowledge

they possess are needed. In some instances, however, their supervisors

may be reluctant to allow them to interrupt their regular jobs, even on

a part-time basis, because it may require training a new person to do a

job that will be temporary.

• Managers don't want to lose the output of good workers. The workers

are not always eager to participate in projects because it may mean

working for two bosses who impose conflicting demands, and may

cause disruption of friendships and daily routines, and the risk of

being replaced on the current job.

• There may be fear of being associated with an failed project because

of the adverse effect it might have on career progress. When a project

is phased out and the project team scattered, team members tend to

drift away from the organization for lack of a new project and the

difficulty of returning to former jobs.

Project Life Cycle

• The size, length, and scope of projects varies widely according to the

nature and purpose of the project. All projects have something in

common: They go through a life cycle, which consists of five phases:

• Concept at which point the organization recognizes the need for a

project or responds to a request for a proposal from a customer.

• Feasibility analysis which examines the expected costs, benefits, and

risks of undertaking the project.

• Planning which spells out the details of the work and provides

estimates of the necessary human resources, time, and cost.

• Execution during which the project itself is done. This phase accounts

for the majority of time and resources consumed by a project.

• Termination during which closure is attained. Termination can include

reassigning personnel and dealing with any leftover materials,

equipment, and any other resources associated with the project.

Work Breakdown Schedule

Because large projects usually involve a very large number ofactivities, planners need some way to determine exactly whatwill need to be done so that they can realistically estimatehow long it will take to complete the various elements of theproject and how much it will cost. This is often accomplishedby developing a work breakdown structure (WBS).

PERT and CPM

PERT (program evaluation and review technique) and CPM (critical

path method) are two of the most widely used techniques for planning

and coordinating large-scale projects. By using PERT or CPM,

managers are able to obtain

A graphical display of project activities.

An estimate of how long the project will take.

An indication of which activities are the most critical to timely project

completion.

An indication of how long any activity can be delayed without

lengthening the project.

The Network Diagram

• One of the main features of PERT and related techniques is

their use of a network or precedence diagram.

• Activity-on-arrow(A-O-A) Network diagram convention

in which arrows designate activities.

• Activity-on-node (A-O-N) Network diagram convention in

which nodes designate activities.

• Activities can be referred to in either of two ways. One is

by their end points and the other is by a letter assigned to an

arrow. Project steps that consume resources and/or time.

The Network Diagram• Events The starting and finishing of activities, designated

by nodes in the A-O-A convention.

• Path A sequence of activities that leads from the starting

node to the finishing node.

• Critical path The longest path; determines expected project

duration.

• Critical activities Activities on the critical path.

• Slack Allowable slippage for a path; the difference between

the length of a path and the length of the critical path.

Network

a

b

c

Network

b

c

a

Network

a

b

c

d

Network

a

Deterministic Time Estimates

The main determinant of the way PERT and CPM networks

are analyzed and interpreted is whether activity time estimates

are probabilistic or deterministic.

If time estimates can be made with a high degree of

confidence that actual times will not differ significantly, we

say the estimates are deterministic.

If estimated times are subject to variation, we say the estimates

are probabilistic.

Probabilistic time estimates must include an indication of the

extent of probable variation.

Example 1 Determine the length of each path,critical path, expected length of the project,and, amount of slack time for each path fromthe following data below:

165

4

3

28 weeks

4 weeks9 weeks

3 weeks

6 weeks

1 weeks11 weeks

Solution

Path Length (Weeks) Slack

1-2-4-5-6 8+6+3+1=18 20-18=2

1-2-5-6 8+11+1=20 20-20=0

1-3-5-6 4+9+1=14 20-14=6

A Computing Algorithm

• ES, the earliest time, activity can start, assuming all precedingactivities start as early as possible.

• EF, the earliest time, the activity can finish.

• LS, the latest time, the activity can start and not interrupt theproject.

• LF, the latest time, the activity can finish and not delay theproject.

• Once these values have been determined, they can be used to find:

• Expected project duration

• Slack time

• Those activities on the critical path

Computing EF and ES times

The earliest finish time for any activity is equal to its

earliest start time plus its expected duration as

EF = ES + t

ES for activities at nodes with one entering arrow is equal to

EF of the entering arrow. ES for activities leaving nodes

with multiple entering arrows is equal to the largest EF of

the entering arrow.

Example 2 Compute the earliest starting time and

earliest finishing time for each activity in the

diagram shown in the figure

165

4

3

28 weeks

4 weeks9 weeks

3 weeks

6 weeks

1 weeks11 weeks

Computing LS and LF Times

• The latest starting time for each activity is equal to its latestfinishing time minus its expected duration.

LS = LF - t

• For nodes with one leaving arrow, LF for arrows entering thatnode equals the LS of the leaving arrow. For nodes with multipleleaving arrows, LF for arrows entering that node equals thesmallest LS of leaving arrows.

• Finding ES and EF times involves a "forward pass" through thenetwork; finding LS and LF times involves a "backward pass"through the network. Hence, we must begin with the EF of thelast activity and use that time as the LF for the last activity. Thenwe obtain the LS for the last activity by subtracting its expectedduration from its LF

Example 3 Compute the latest starting time and

latest finishing time for each activity in the

diagram shown in the figure

165

4

3

28 weeks

4 weeks9 weeks

3 weeks

6 weeks

1 weeks11 weeks

Independence

Assumption that path duration times are independent of each

other; requiring that activity times be independent, and that

each activity is on only one path.

Probabilistic Time EstimatesThe probabilistic approach involves three time estimates for

each activity instead of one:

Optimistic time (o)

The length of the time required under optimal conditions.

Pessimistic time (p)

The length of time required under the worst conditions;

Most likely time (m)

The most probable amount of time required.

Beta Distribution

• Expectation value=𝑡𝑒 =𝑜+4𝑝+𝑚

6

• Variance =𝜎2 = ((𝑚−𝑜)

6)2

Example 4 The network diagram for a project is shown in the figure with three ti

me estimates for each activity. Activities are given in months. Do the following:

1. Compute the expected time for each activity and the expected duration for each

path. 2. Identify the critical path. 3. Compute the variance of each activity and the

variance of each path.

1-3-4a

2-3-6g

4-6-8h

2-3-5c

5-7-9f

3-5-7e

3-4-5d

2-4-6b

3-4-6i

1-3-4 indicates optimistic time, most likely time, and pessimistic time.

Solution

Path Activity o m p 𝒕𝒆 Path Total

a-b-c a 1 3 4 2.83 10.00

b 2 4 6 4.00

c 2 3 5 3.17

d-e-f d 3 4 5 4.00 16.00

e 3 5 7 5.00

f 5 7 9 7.00

g-h-i g 2 3 6 3.33 13.50

h 4 6 8 6.00

i 3 3 6 4.17

Solution

Path Activity o m p 𝜎2 𝜎2 𝜎Path

a-b-c a 1 3 4 9/36 34/36 0.97

b 2 4 6 16/36

c 2 3 5 9/36

d-e-f d 3 4 5 4/36 36/36 1.00

e 3 5 7 16/36

f 5 7 9 16/36

g-h-i g 2 3 6 16/36 41/36 1.07

h 4 6 8 16/36

i 3 3 6 9/36

Computation

Computation

Computation

Computation

Q & A

Thanks For Your Kind Attention