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Petersen General ContractorsCase 8-1
Chapter 8PERT, CPM, Resource Allocation and GERT
On-line MS Project Tutorials
http://webcampus.stthomas.edu/s3c/Software/Project/ProjectEC_1a.html
Team Alternative
• Form teams of five or fewer– Identify the task of each team member– Rate the contribution of each member
Teams 2,3,and 4
Team 1
Real World Considerations
• Other concurrent projects (size of total commitments)
• Coordinating with other companies (structure)
• Have you ever built a TV Tower? (technology)
• What is the basis for the estimators estimate?– Is company experience still valid?
– Is 15% for contingencies still appropriate?
Thankfully this is not the real world.Thankfully this is not the real world.Size
Str
uctu
re
Technology
Tasks with MS ProjectTeam One • Manage the other teams • Do a post mortem
– Identify the benefits of a team approach
– Identify the issues encountered– Characterize your team
Team Two - At normal rate• In how many days can the job be
completed?• What bid will yield a 10% pre tax
profit?• To reduce risk, what are the key tasks
to watch?
Team Three - At the fastest time:
• In how many days can the job be completed
• What bid will yield a 10% pre tax profit?
• To reduce risk, what are the key tasks to watch?
Team four -
• If cost is not a consideration, what else can be done to shorten the project?
• Address real world issues
Deliverablesshort written reposts
• Team One - Reality of managing this project
• Teams Two and Three - MS Project based appropriate network diagrams for each time scenario identifying:
– Key events
– Dependencies
– Cost estimates for each time scenario
• Team Four
– Using team one and two's analysis, provide a list of alternatives for:
• Shortening the project if cost is not an object
• Further reducing costs
– Address the real world issues
FAQs
• Yes, you will work in teams
• Yes, this is a project within a project
•
•
• Others?
Petersen General ContractorsCase 8-1
the book answer
At a Normal Rate
• Time– The critical path, a a-f-h-i-v-k-cc-ee = 224 days
– Next longest path is a-b-c-l-n-m-p-q-r-s-u-ee = 200 days
At a Normal Rate
Costs– Total direct costs = $364,050
• Direct labor = $206,280
• Direct material = $157,770
– + Indirect costs @ 65% of direct cost = $600,682.50
– + Contingency @ 15% of direct plus indirect cost = $690,784.87
– + Bid with 10% profit = $759,863.35
$500Direct cost are 50%
Shortest Possible Timesame path new time
• Time– The critical path, a a-f-h-i-v-k-cc-ee = 191 days
– Second critical path is a-b-c-l-n-m-p-q-r-s-u-ee = 191 days
25
29
30 14
25 434
Shortest Possible Timesame path new time, new cost
Costs– Total direct costs = $383,813.20
• Direct labor = $226,043.20– Activities on the critical path increase = $16,320
– Activities on the second critical path = $3443.20
• Direct material = $157,770
– + Indirect costs and contingency = $728,285.54
– + Bid with 10% profit = $801,114.10
(plus $41,250.25 for 35 days)
Time is money
What to Supervise More Carefully
• Near critical paths
• Areas of new technology or technique
• New staff
• High risk items
• Any “high visibility” items
• OthersGlass, china and reputation are easily brokenAnd never well mended. Ben Franklin
If “Shortest” is Still Too Long
• Sub contract sub assemblies
• Buy a tower and transport it
• Others?
Think out of the box
Some Leading Authors
Idea-Based Leadership
• Ensure the presence and respect for idea practitioners
• Set forth an idea strategy in a idea-friendly culture
• Be open to ideas and the people who suggest them
• Reward the practitioners• Signal the importance of ideas
Yes No
How does your organization rate and whySource: What’s the Bid IdeaThomas Davenport, and Laurence Prusak with H. James Wilson
Breaking Through to Innovation• Technology = arrangement of objects, ideas and people to accomplish a goal• Technology brokering = exploiting existing technologies to create new ones• Innovation is not breaking free of the past; it is harnessing the past in new
ways
Source:How Breakthroughs HappenAndrew Hargadon
Your perspective
and knowledge
Othersperspective
and knowledge
The Balancing Act
ActionableDogma
Jack of all tradesMaster of none
"Knowledge" is both the raw material for innovation and
"comfort" that inhibit seeking new opportunities outside of your comfort zone.
Inside Outside
Dee
pSh
allo
w
Breath
Dep
th
Networking
New Ideas
Source:How Breakthroughs HappenAndrew Hargadon
The Rules
• Never forget the future is already here. • Analogy trumps invention• Find your discomfort zone• Divided we innovate.• Bridge to your strengths • Build to your weakness • Build teams • As goes the individual, so goes the organization• Rip, mix and burn Source:
How Breakthroughs HappenAndrew Hargadon
Efficiency – Innovation Dichotomy
Efficiency InnovationStay inBusiness
Today’s BusinessClimate
Source:Creating the Innovation CultureFrances Hribe
Honoring the Dissenters Foster Innovation
• Dissenters offer new ideas
• Force others to challenge their assumptions
• Dissent can:– Kill wrong or out of date ideas– Tap into peoples tacit (gut) knowledge– Break you out of a think rut SOW
Source:Creating the Innovation CultureFrances Hribe
How to Kill Dissent (Innovation) Without Really Trying
• Best practices – make the status quo better
• Treat everybody equally – no one is a valuable resource who's ideas count
• Hire a mini me – all run down the same train of thought
• Design a process for innovation – oxymoronic?
Source:Creating the Innovation CultureFrances Hribe
How to Foster Innovation
• Speak last in meetings
• Seek out dissenter’s view
• Protect the dissenter
• Help dissenter be heard
• Challenge the Status Quo
Min
ority
Rep
ots a
re
a go
od th
ing
Source:Creating the Innovation CultureFrances Hribe
80 /20 and You19th Century – Vilfredo Pareto
• A small minority (20%) account for a majority (80%) of the wealth
20th Century – Joseph Juran
• Solving quality problems depends on differentiation the vital few cause from the trivial many.
Every job should leverage your 20% genius 80% of the timeSource:Richard Koch80/20 Individual
Out of the Box Thinking
•Budgets and Schedules•Self Interest
•Silos and Turf•Good Enough
Problems Looking for a Solution•If resources were no object•Walk in the others shoes
Solutions Looking for a Problem•Where else would it fit•Do it the opposite way
Source:Why NotBary Nalebuff and Ian Ayres
Selling your Ideas
• Elevator pitch
• KISS – keep is similar silly
• Know to whom to pitch
• Make it their idea
Source:Why NotBary Nalebuff and Ian Ayres
The Capability to Innovate
• Process
• People
• Strategy and Customers
• Technology
• Measures and PerformanceSource: 24/7 InnovationStephen M. Shapiro
ProcessThe “re’s”
• Rethink
• Reconfigure
• Re-sequence
• Relocate
• Reduce
• Reassign
• Retool
Phrase Problems in Ways They Can Be Solved…
• How to…………. (H2)
• How might……….. (HM)
• In what ways might…….(IWWM)
• What might………….(WM)
Source: Dave LabnoInnovation Consultant
Do it globallyDo it globally
Slides not Used
What would you do if you
weren’t afraid?
Source:Spencer JohnsonWho Moved My Cheese
Who Moved My Cheese
We all approach EC Change Differently
• Sniff – Sniffs out the situation and sees early
• Scurry – Goes into action immediately
• Hem – Does not want to deal with change and stays in familiar territory
• Haw - Sees what he is doing is wrong, laughs at himself, and finally changes
Haw’s Writing on the Wall
• Change happens, they keep moving the cheese• Anticipate change – get ready for the cheese to
move• Monitor change – smell the cheese often• Adapt to change quickly• Enjoy change – savor the adventure• Be ready to change quickly and enjoy it again.
They keep moving the cheese
The Johari Window
Hidden
BlindUnknown
Open
Kn
ow t
o S
elf
Known to Others
Un
know
n
Unknown
Kn
own
Known
TellA
sk
Pareto – Yesterday and Today
• Corporations created wealth
• Jobs are repetitive & labor intensive
• Managers – Theory X
• Shareholders consume wealth
• Capital is king
• Centralized planning yields strategic goals
• Economies of scale and mass production
• Mangers are focus of power
• Individuals create wealth
• Few employees &creative imagination
• Coaches - Theory Y and Z
• Venture capitalist and entrepreneurs share the wealth
• Creativity is critical element
• Agility & contractual relationships
• Mass customization
• Companies reunite ownership and control
Managerial Capitalism Individualism
Source:Richard Koch80/20 Individual
Customer Strategies
• Add more value
• Listen
• Serve
• Hire
Creating a Culture of Innovation
• Envision
• Enable
• Explode
• “EmpowerTool”
Technology and Innovation
• Create a virtual enterprise
• Change the rules of the game
• Collaborate across the value chain
• Increase the knowledge of employees
• Launch new businesses
Getting There
• Alliance Based
• Capability Bases
• Process Dominated
• Process Driven
• Process Sensitive
• Functionally Bound
Sta
ges
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