Project ManagementCopyright 2011 John Wiley & Sons, Inc.
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Project Management Process
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Project team
made up of individuals from various areas and departments within a company
Matrix organization
a team structure with members from functional areas, depending on skills required
Project manager
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Scope Statement
Scope statement
a document that provides an understanding, justification, and expected result of a project
Statement of work
Copyright 2011 John Wiley & Sons, Inc.
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Copyright 2011 John Wiley & Sons, Inc.
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Responsibility Assignment Matrix
Organizational Breakdown Structure (OBS)
a chart that shows which organizational units are responsible for work items
Responsibility Assignment Matrix (RAM)
Copyright 2011 John Wiley & Sons, Inc.
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Global project teams are formed from different genders, cultures, ethnicities, etc.
Diversity among team members can add an extra dimension to project planning
Cultural research and communication are important elements in the planning process
Copyright 2011 John Wiley & Sons, Inc.
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Bars also indicate status of tasks
Provides visual display of project schedule
Slack
amount of time an activity can be delayed without delaying the project
Copyright 2011 John Wiley & Sons, Inc.
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Lay foundation
Month
Month
Project Control
Time management
Cost management
Performance management
measure schedule and budget variation
Copyright 2011 John Wiley & Sons, Inc.
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CPM/PERT
Probabilistic task time estimates
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Event
Copyright 2011 John Wiley & Sons, Inc.
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Branch
Node
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Order and receive materials
Dummy
two or more activities cannot share same start and end nodes
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Order &receive materials
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Minimum project completion time
B: 1-2-5-6-7 3 + 2 + 1 + 1 + 1 = 8 months
C: 1-3-4-7 3 + 1 + 3 + 1 = 8 months
D: 1-3-5-6-7 3 + 1 + 1 + 1 + 1 = 7 months
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Start
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Forward pass
starts at beginning of CPM/PERT network to determine earliest activity times
Earliest finish time (EF)
EF= ES + t
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Start
Select paint
Lay foundation
Select carpet
Build house
Finish work
Latest start time (LS)
Latest time an activity can start without delaying critical path time
LS= LF - t
Latest finish time (LF)
latest time an activity can be completed without delaying critical path time
LF = minimum LS of immediate predecessors
Backward pass
Determines latest activity times by starting at the end of CPM/PERT network and working forward
Copyright 2011 John Wiley & Sons, Inc.
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b = pessimistic time estimate
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P(time)
P(time)
P(time)
Time
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t
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Copyright 2011 John Wiley & Sons, Inc.
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Finish
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Activity Early, Late Times & Slack
Copyright 2011 John Wiley & Sons, Inc.
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Earliest, Latest, and Slack
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= 1.00 + 0.11 + 1.78 + 4.00
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where
x = proposed project time
Z = number of standard deviations that x is from the mean
Z =
x -
Copyright 2011 John Wiley & Sons, Inc.
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= tp
Time
x
Z
Probability
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What is probability that project is completed within 30 weeks?
2 = 6.89 weeks
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From Table A.1, (appendix A) a Z score of 1.91 corresponds to a probability of 0.4719. Thus P(30) = 0.4719 + 0.5000 = 0.9719
= 25
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What is probability that project is completed within 22 weeks?
2 = 6.89 weeks
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From Table A.1, (appendix A) a Z score of 1.14 corresponds to a probability of 0.3729. Thus P(22) = 0.5000 - 0.3729 = 0.1271
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Relatively easy to use
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Gantt chart; click on “View” to activate
Create precedence relationships; click on predecessor activity, then holding “Ctrl” Key, click on successor activity.
Microsoft Project
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Critical path in red
Microsoft Project – Zoom View
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Copyright 2011 John Wiley & Sons, Inc.
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Black bars show degree of completion
PERT Analysis with Microsoft Project
Copyright 2011 John Wiley & Sons, Inc.
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Click on PERT Entry Sheet to enter 3 time estimates
Click on PERT calculator to compute activity duration
PERT Analysis with Microsoft Project
Copyright 2011 John Wiley & Sons, Inc.
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Crash time
Crash cost
Goal
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Copyright 2011 John Wiley & Sons, Inc.
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$7,000 –
$6,000 –
$5,000 –
$4,000 –
$3,000 –
$2,000 –
$1,000 –
Normal activity
Normal time
Normal cost
Crash time
Crashed activity
Crash cost
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TOTAL
ACTIVITY (WEEKS) (WEEKS) COST COST (WEEKS) WEEK
1 12 7 $3,000 $5,000 5 $400
2 8 5 2,000 3,500 3 500
3 4 3 4,000 7,000 1 3,000
4 12 9 50,000 71,000 3 7,000
5 4 1 500 1,100 3 200
6 4 1 500 1,100 3 200
7 4 3 15,000 22,000 1 7,000
$75,000 $110,700
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Crashing costs increase as project duration decreases
Indirect costs increase as project duration increases
Reduce project length as long as crashing costs are less than indirect costs
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Cost ($)
Total project cost
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