Www.utm.my innovative ● entrepreneurial ● global 1 By Syuhaida Ismail, Ph.D, C.Eng. Mohammad Gholamzadeh, M.Eng. syuhaidaismail.com 0126469235 MDE 2583

www.utm.my innovative ● entrepreneurial ● global 1

By

Syuhaida Ismail, Ph.D, C.Eng.Mohammad Gholamzadeh, M.Eng.

syuhaidaismail.com0126469235

MDE 2583 - PROJECT MANAGEMENT


ICE-BREAKING


AGENDA

Slot Activity9.00 am – 10.45 am 2-way lecture10.45 am – 11.00 am Break11.00 am – 12.45 pm Group assignment I2.00 pm – 3.00 pm Industrial Talk by IEM PMTD Chairman3.00 pm – 3.30 pm Q&A3.30 pm – 3.45 pm Break3.45 pm – 6.00 pm Group assignment II

Saturday (1 March 2014)


AGENDA

Slot Activity9.00 am – 10.45 am Group presentation10.45 am – 11.00 am Break11.00 am – 1.00 pm Group assignment III2.00 pm – 3.00 pm Industrial Talk by IEM PMTD Committee3.00 pm – 3.30 pm Q&A3.30 – 3.45 pm Break3.45 pm – 6.00 pm Group assignment III

Sunday (2 March 2014)


ASSESSMENT

1 Individual Assignment 2 x 20%

40 %

2 Case Study Group Assignment

2 x 10%

20 %

3 Post Module Assignment 1 x 40%

40 %

Total 100 %


References/Bibliography

● PMBOK (2008)● MS Project 2013● Kerzner, R. (2013). Project Management:

Systems Approach to Planning, Scheduling and Controlling. John Wiley & Sons Inc.

● Gray, C.F. and Larson, E.W. (2006). Project Management: The Managerial Process. New York: McGraw-Hill International Edition.

● Meredith, J.R. and Mantel, S.J. (2009). Project Management: A Managerial Approach. John Wiley & Sons Inc.

6


IMPORTANCE OF PROJECT MANAGEMENT



Project management is “the application of knowledge, skills, tools, and techniques to project activities in order to meet or exceed stakeholder needs and expectations from a project” (PMI*, Project Management Body of Knowledge (PMBOK Guide), 1996, p. 6)

WHAT IS PROJECT MANAGEMENT?


OPERATION VS PROJECT

Operation– Existing systems– Repetitive work– Efficiency and

effectiveness– Reliance on standard

procedures– Line management– Focus on “maintaining”

Project– One-time resource

configuration– Unique and separate

work– Cohesion and direction– End-product driven– Stakeholder driven– Project orientation– Focus on “change”


CHARACTERISTICS OF A PROJECT

● Specific objectives- Time, Cost & Performance● Multi-Disciplinary – different disciplines, companies and

countries● Temporary undertakings- definite start and end date;

therefore of finite duration● Consume and compete for scarce resources● Produce unique and one-off outcomes● Phases - Project has a number of phases/schedule● Usually have own budgets● One leader assigned overall responsibility● Projects are subject to a lot of changes● Subject to conflicts



PROJECT OBJECTIVES

● Performance and quality standards● Safety and reliability● Timescales and timing of events● Costs: budgets and rates of spend● Use of resources● Value and cost benefits/effectiveness● Management requirements and contract

agreements


PROJECT STAKEHOLDERS

● Stakeholders are the people involved in or affected by project activities

● Stakeholders include– the project sponsor and project team– support staff– customers– users– suppliers– opponents to the project


WHEN IS A PROJECT A PROJECT?

Stewart (1965) uses four criteria● Scope- definable in terms of a single, specified

end result● Unfamiliarity-unique, infrequent, more

uncertainty● Complexity- greater degree on interdependency

amongst tasks● Stake (risk)- Outcome affects company’s stake


TRIPLE CONSTRAINTS OF PROJECT MANAGEMENT

Solutions must not exceed boundaries


NORMAL MEASURES OF SUCCESS

● New Products● New Markets● New Facilities● New Organisational Forms● Etc

Subject to the triple constraints of satisfying Time, Cost and Performance criteria






TORRE DAVID

● Is Torre David a failure or a success? Discuss.– How do you measure the success/failure– What are the factors that most influence a

successful/failed project outcome?● What are the causes that lead to under-

performing of projects? How do they arise?


OTHER MEASURES OF PROJECT SUCCESS

● National pride or security● Learning and experience● Improved status and visibility● Training and development● Opportunities for authority and

responsibility● Improved ability/skills


SYDNEY OPERA HOUSE- PROJECT MANAGEMENT FAILURE?

"The construction of the beautiful freestanding, sculptural tripartite Opera House was one of the longest contractual sagas of the century. Sadly, architect Jorn Utzon became the scapegoat of a scandalous political affair and in 1966 withdrew from his project. Originally, the winner of an international open competition in 1957, it was a scheme that broke most of the rules. It was finally completed in August 1973 by other hands under the direction of Peter Hall."


IRONIC ISN’T IT?

● Despite its failure as a PM exercise, the Sydney Opera House is considered a world-class venue for opera and a tourist attraction. It is one of the 20th century's most distinctive buildings and one of the most famous performing arts centres in the world.

● So, are we confusing between the project exercise and the result of a project?


CONCORDE-FAILURE ?● Conceived in 1959. The first

prototype (aircraft 001 F-WTSS) was rolled out on 11 December 1967, but extensive ground testing meant that it didn't fly until 2 March 1969. In December 1971, the first pre-production aircraft (101) made its maiden flight.

● However, the oil crisis sparked by the 'Yom Kippur' war of 1973 had a most devastating affect on sales. The soaring cost of fuel rendered Concorde completely uneconomic for all but state-subsidised airlines.


SUCCESS IN FAILURE

● Although the Concorde was a commercial failure, it was a marvellous engineering success and flew for almost thirty years until its retirement in 2003.


MARS POLAR LANDER’S FAILURE OF SIMPLE NASA SYSTEM ENGINEERING ERROR


PROJECT MANAGEMENT FRAMEWORK

Project Management IntegrationProject

Success

ScopeMgt.

TimeMgt.

CostMgt.

QualityMgt.

HRMgt.

Comm.Mgt.

RiskMgt.

Procure.Mgt.

9 Knowledge Areas Core Functions

Facilitating Functions

Stakeholderneeds and

expectations

Tools andtechniques


Knowledge Areas

Project Management Process GroupsInitiating Planning Executing Monitoring

and Controlling

Closing

Project Integration Management

Develop project charter Develop project management plan

Direct and manage project execution

- Monitor and control project work- Perform integrated change control

Close project or phase

Project Scope Management

- Collect requirements - Define scope- Create work breakdown structure (WBS)

- Verify scope- Control scope

Project Time Management

- Define activities- Sequence activities- Estimate activity resources- Estimate activity durations- Develop schedule

Control schedule

Project Cost Management

- Estimate costs- Determine budget

Control costs

Project Quality Management

Plan quality Perform quality assurance

Perform quality control

Project Human Resource Management

Develop human resource plan

- Acquire project team- Develop project team- Manage project team

Project Communications Management

Identify stakeholders Plan communications - Distribute information- Manage stakeholder expectations

Report performance

Project Risk Management

- Plan risk management- Identify risks- Perform qualitative risk analysis- Perform quantitative risk analysis- Plan risk responses

Monitor and control risks

Project Procurement Management

Plan procurements Conduct procurements Administer procurements

Close procurements


PROJECT INTEGRATION MANAGEMENT

Project managers must coordinate all of the other knowledge areas throughout a project’s life cycle

Many new project managers have trouble looking at the “big picture” and want to focus on too many details


RESPONSIBILITY AND AUTHORITY

● Senior management commitment to Project Management concept is vital

● Project Manager must clear authority and responsibility over personnel -50% of the battle for project success

● Leadership is crucial-in all cases, these can only be one responsible project leader


KEY TO SUCCESS

● People processes of Teamwork and Leadership as well as Tools and Techniques

● Blending of Hard & Soft Methods and Techniques are important in Project Management


Tools in Project Management

● Microsoft Project (MSP)● Primavera Project Planner (P3)● Primavera Professional Project

Management (P6)

34


Project Management Structures

● Enterprise Project Structure (EPS)

35

Water Sewage Company

Operation & Logistic

Water

Abadan

Ahwaz

Project1

Project 2

Project 3

Sewage

Human Resource

Marketing

Project1Office

BuildingDesign

Construct

Civil &StructuralMechanical and

electrical

equipmentExteri

or

Interior

Oxidation Ponds

Transformation

Software

• Work Break Down Structure (WBS)


PROJECT LIFE CYCLE

Time Distribution of Project Effort● Conception● Selection● Planning,

scheduling, monitoring, control

● Evolution and termination


Process Groups Interact in a Phase or Project

Project Management Process


PROJECT LIFE-CYCLE


FACTORS AFFECTING PROJECT OUTCOME

● Project manager● Project team● Stakeholder● Scope, goals and

objectives● Communication● Risks

Early Project phase work Important matters Alternatives Planning Control Outsourcing Documentation


PROJECT CATEGORIES BY TIME SCALES

● Long Term (over 10 years)Electrification / Water pipes replacementDefence Upgrading

● Medium Term (3 to 10 years)Construction of a DamComputerisation of schools

● Short term (0.5 to 3 years)Organisation of conferences/ new consumer productsHotel construction

● Special small scaleEmergency evacuationJE vaccination


TYPES OF PROJECTS

Well Defined

Poorly Defined

Well Defined

TYPE 1(KLIA)

TYPE 3(Software)

Poorly Defined

TYPE 2(A380 Airbus)

TYPE 4(Multi Media Super

Corridor)

Project ResultsP

roje

ct m

etho

ds


DISCUSSIONS

Give examples of project types in your organisation and reason out why you assign them into the above categories

1. TYPE 1- …………………………….2. TYPE 2- …………………………….3. TYPE 3- …………………………….4. TYPE 4- …………………………….


PROJECT CONSTRAINTS

●Inadequate resources●Unrealistic schedules●Unrealistic budgets●Unrealistic objective●Conflicts


PROJECT MANAGEMENT PROBLEMS

1. Inadequate resources.2. Unrealistic deadlines.3. Unclear goals or direction.4. Team members

uncommitted.5. Insufficient planning.6. Communication

breakdown.7. Changes in goals and/or

resources.8. Conflicts between

functions or departments.9. Underestimation of the

technical difficulty

10. Problems with software projects.

11. Inability to control contractors work and failure to use specialist staff.

12. Weakness in contract arrangements.

13. Lack of effective planning and control.

14. Interruptions in funding (escalation to escalation).

15. Non-compliance with procedures


Scope Management


Project Scope Management

● Organisation scope – defining scopes amongst organisations involved

● Project scope – defining scopes of the project itself● Activity scope – determining how detailed you want to

cover the activity

46


Project Time Management

● Create project calendar● Define WBS● Define the activities● Determine sequence of activities● Estimate activities duration● Estimate activities resources● Determine constraints and limitation● Develop schedule● Control

47


WORK BREAKDOWN STRUCTURE

● A work breakdown structure (WBS) is an outcome-oriented analysis of the work involved in a project that defines the total scope of the project

● A graphical display of the project that shows division of work in a multilevel system

● The concept of the WBS is simple: in order to manage a whole project, one must manage/control each of its part

● It is a foundation document in project management because it provides the basis for planning and managing project schedules, costs, and changes



● WBS defines: – Work to be performed– The needed expertise, – Selection of the project team, – Base for project scheduling and control

● The development of WBS is a continuing process:– Starts when the project is first assigned to the project

manager – Continues until all work packages have been defined

www.utm.my innovative ● entrepreneurial ● global 50Copyright Course Technology 1999 50

Figure 4-6a. Sample of Intranet WBS Organized by Product

www.utm.my innovative ● entrepreneurial ● global 51Copyright Course Technology 1999 51

Figure 4-6b. Sample Intranet WBS Organized by Phase


Table 4-3. Intranet WBS in Tabular Form

1.0 Concept1.1 Evaluate current systems1.2 Define Requirements

1.2.1 Define user requirements1.2.2 Define content requirements1.2.3 Define system requirements1.2.4 Define server owner requirements

1.3 Define specific functionality1.4 Define risks and risk management approach1.5 Develop project plan1.6 Brief web development team

2.0 Web Site Design3.0 Web Site Development4.0 Roll Out5.0 Support


Figure 4-7. Intranet WBS and Gantt Chart in Microsoft Project 98

WBS Gantt Chart


APPROACHES TO DEVELOP WBS

● Using guidelines: Some organizations, like the DOD, provide guidelines for preparing WBSs

● The analogy approach: It often helps to review WBSs of similar projects

● The top-down approach: Start with the largest items of the project and keep breaking them down

● The bottoms-up approach: Start with the detailed tasks and roll them up


BASIC PRINCIPLES FOR CREATING WBS

1. A unit of work should appear at only one place in the WBS.2. The work content of a WBS item is the sum of the WBS items below it.3. A WBS item is the responsibility of only one individual, even though many people

may be working on it.4. The WBS must be consistent with the way in which work is actually going to be

performed; it should serve the project team first and other purposes only if practical.

5. Project team members should be involved in developing the WBS to ensure consistency and buy-in.

6. Each WBS item must be documented to ensure accurate understanding of the scope of work included and not included in that item.

7. The WBS must be a flexible tool to accommodate inevitable changes while properly maintaining control of the work content in the project according to the scope statement.

*Cleland, David I. Project Management: Strategic Design and Implementation, 1994


Sample of Activity Definition Form

56

WBS: Date:

Activity Code Activity

Name

Duration Predecessor Lag Constraint/

Limitation

Resource Cost

Project Manager Signature:

Date:

Supervisor Signature:

Date:

Provider Signature:

Date:




CREATE A WBS FOR SATAY BARBEQUE

Assumptions• Vegetables are uncut• Nasi impit is uncut• Kuah is unheated• Satay is raw• Satay Grill ready but no fire• Arang/coal ready• Fire lighter available• Lighter available• Plates are available

Activity ends when satay is served as shown



Serve Satay

Veggies & Nasi Impit

Prepare Satay Grill

Barbeque & Serve

1.1 Cut nasi impit1.2 Cut onions1.3 Cut cucumbers1.4 Warm up sauce

2.1 Put charcoal in grill2.2 Light Fire2.3 Spread charcoal

3.1 Put Satay on Grill3.2 Grill & Serve

1 2 3


Heat up Kuah

Cut Nasi Impit

Serve Satay on plate

Cut CucumberCut OnionsLight fire

Spread coals

Cook Satay


WHY ARE PROJECTS HARD?● Resources

– People, materials● Planning

– What needs to be done?– How long will it take?– What sequence?– Keeping track of who is supposedly doing

what, and getting them to do it


IT PROJECTS

● Half finish late and over budget● Nearly a third are abandoned before

completion– The Standish Group, in Infoworld

● Get & keep users involved & informed● Watch for scope creep / feature creep


PROJECT SCHEDULINGPROJECT SCHEDULING

● Establishing objectives● Determining available resources● Sequencing activities● Identifying precedence relationships● Determining activity times & costs● Estimating material & worker

requirements● Determining critical activities



● Hierarchy of what needs to be done, in what order

● For me, the hardest part– I’ve never done this before. How do I know what

I’ll do when and how long it’ll take?– I think in phases– The farther ahead in time, the less detailed– Figure out the tricky issues, the rest is details– A lot will happen between now and then– It works not badly with no deadline


MUDROOM REMODEL

● Big-picture sequence easy:– Demolition– Framing– Plumbing– Electrical– Drywall, tape & texture– Slate flooring– Cabinets, lights, paint

● Hard: can a sink fit?

D

W

DW


PROJECT SCHEDULING TECHNIQUESPROJECT SCHEDULING TECHNIQUES

● Gantt chart● Critical Path Method (CPM)● Program Evaluation & Review

Technique (PERT)


GANTT CHARTGANTT CHART

J F M A M J J

Time PeriodActivity

Design

Build

Test

J F M A M J J

Time PeriodActivity

Design

Build

Test


PERT & CPMPERT & CPM

● Network techniques/analysis system● Consider precedence relationships &

interdependencies● Each uses a different estimate of

activity times


CRITICAL PATH METHOD (CPM)

● Critical Path Method (CPM) – Developed in 1956 – by the DuPont Company with

Remington Rand as consultants, as a deterministic approach to scheduling.

– Commonly used in the engineering and construction industry.


PROGRAM EVALUATION AND REVIEW TECHNIQUE (PERT)

● Program Evaluation and Review Technique (PERT) -Similar method – Developed in 1957 – by the US Navy, with Booz, Allen &

Hamilton Management Consultants, as a probabilistic approach to scheduling for Polaris missile

– Commonly used by the manufacturing industry

Both methods are often referred to as a network analysis system.


● The purpose of CPM is– Plan the work

– Guide the progress of a project

– Provide a baseline for project control

CRITICAL PATH METHOD (CPM)





PERT & CPM STEPSPERT & CPM STEPS

● Identify activities● Determine sequence● Create network● Determine activity times● Find critical path

• Earliest & latest start times • Earliest & latest finish times • Slack


● Activity – A specific task or set of tasks– Use resources and take time to

complete – e.g. concreting

● Event – The result of completing one or more

activities– Use no resources

Chapter 8-9

TERMINOLOGY


● Network – Combination of all activities and

events– Define the project and the activity

precedence relationships

Chapter 8-9

TERMINOLOGY


TERMINOLOGY

● Path – Series of connected activities (or

intermediate events) between any two events in a network

● Critical – Activities, events, or paths which, if

delayed, will delay the completion of the project

– A sequence of critical activities that connect the project’s start event to its finish event

Chapter 8-10


● An activity can be in any of these conditions:– It may have a successor(s) but no

predecessor(s) - starts a network– It may have a predecessor(s) but no

successor(s) - ends a network– It may have both predecessor(s) and

successor(s) - in the middle of a network

Chapter 8-11

TERMINOLOGY


Activity on Node (AoN)Activity on Node (AoN)

2

2? Years

EnrollReceive Master

Project: Obtain a Master’s Degree

1 month

Attend class, study etc.

1

1 day

3


Activity on Arrow (AoA)Activity on Arrow (AoA)

2 ? Years

Enroll

Receive Master


1 month

Attend class, study,

etc.1

1 day

2 3 4


AoA Nodes Have MeaningAoA Nodes Have Meaning

GraduatingApplicant


1

Alumni

2 3 4

Student


Terminology

Chapter 8-9

eventactivity

Indicatorb = concreting


We’ll use Activity on NodeWe’ll use Activity on Node

1-2 must be done before 2-3 or 3-4 can start

2

3

4

1


Activity RelationshipsActivity Relationships

2-3 must be done before 3-4 or 3-5 can start

2

3

4

1 5


2-4 and 3-4 must be done before 4-5 can start

2

3

4

1 5

Activity RelationshipsActivity Relationships


NETWORK EXAMPLENETWORK EXAMPLE

You’re a project manager for Bechtel. Construct the network.

Activity PredecessorsA --B AC AD BE BF CG DH E, F


NETWORK EXAMPLE - AONNETWORK EXAMPLE - AON

A

C

E

F

BD

G

H

Z


NETWORK EXAMPLE - AONNETWORK EXAMPLE - AON


NETWORK EXAMPLE - AOANETWORK EXAMPLE - AOA

2

4

51

3 6 8

7 9A

C F

EBD

H

G


AOA DIAGRAMS

2 31A

C

BD

A precedes B and C, B and C precede D

2 41A C

B

D

3

5

4

Add a phantom arc for clarity.


DUMMY


LET’S TRY THIS!

Activity PredecessorA -B -C AD A,B


DUMMY


DUMMY

● An activity with zero duration● Links together activities whose sequence would

otherwise not be shown● Indicated by a dashed arrow ● Show the sequence between activities e.g.

activity A and D without the problem of linking Activity B with Activity C

● Is determined by looking at the activity list and find those activities that share some, but not the entire set of prior activities.


CRITICAL PATH ANALYSISCRITICAL PATH ANALYSIS

● Provides activity information• Earliest (ES) & latest (LS) start• Earliest (EF) & latest (LF) finish• Slack (S): Allowable delay

● Identifies critical path• Longest path in network• Shortest time project can be completed• Any delay on activities delays project• Activities have 0 slack or float*Critical activities = Activities in critical path. Have no float i.e. ES = EF and/or LS = LF. Indicated with double line.


CRITICAL PATH ANALYSISCRITICAL PATH ANALYSIS


SLACK/FLOATSLACK/FLOAT



● Total float: Measure of leeway (delay) in starting and completing an activity. It assumes that all activities preceding that activity finished as Early as possible and all successor activities are started as Late as possible. FREE TIME WITHOUT DELAYING THE WHOLE PROJECT DURATION

TF = LF – EF = LS - ES ● Free float: Amount of time that an activity’s start

can be delayed with out affecting the early start date of any successor activity in the network. FREE TIME WITHOUT DELAYING THE EARLY START OF SUCCEESOR ACTIVITY

FF = ES NEXT ACTIVITY – EF THAT ACTIVITY


COMPUTE SLACK/FLOATCOMPUTE SLACK/FLOAT


1

3

76

4

5

2

AD

G

B

E

L

H

F

C

J

MK

Activity on arrow network – Figure 1.0


The duration (in weeks) of the activities in the network are given as listed below:-

● A – 7● B – 1● C – 10● D – 3● E – 2● F – 3

● G – 12

● H – 13

● J – 8● K –

17● L – 4● M –

12


EXAMPLE 1

● Find a) The minimum project timeb) The earliest and latest times for each

eventc) The critical path


CRITICAL PATH ANALYSIS EXAMPLE 2CRITICAL PATH ANALYSIS EXAMPLE 2

Event ID

Pred. Description Time (Wks)

A None Prepare Site 1 B A Pour fdn. & frame 6 C B Buy shrubs etc. 3 D B Roof 2 E D Do interior work 3 F C Landscape 4 G E,F Move In 1


NETWORK SOLUTIONNETWORK SOLUTION

AA

EEDDBB

CC FF

GG

1

6 2 3

1

43


EARLIEST START & FINISH STEPSEARLIEST START & FINISH STEPS

● Begin at starting event & work forward● ES = 0 for starting activities

• ES is earliest start● EF = ES + Activity time

• EF is earliest finish● ES = Maximum EF of all predecessors for non-

starting activities


Activity ES EF LS LF SlackA 0 1BCDEF

ACTIVITY A EARLIEST START SOLUTIONACTIVITY A EARLIEST START SOLUTION

For starting activities, ES = 0.For starting activities, ES = 0.

AAEEDDBB

CC FF

GG

1

6 2 3

1

43


Activity ES EF LS LF Slack A 0 1 B 1 7 C 1 4 D 7 9 E 9 12 F 4 8 G 12 13

EARLIEST START SOLUTIONEARLIEST START SOLUTION

AAEEDDBB

CC FF

GG

1

6 2 3

1

43


LATEST START & FINISH STEPSLATEST START & FINISH STEPS

● Begin at ending event & work backward● LF = Maximum EF for ending activities

• LF is latest finish; EF is earliest finish● LS = LF - Activity time

• LS is latest start● LF = Minimum LS of all successors for non-

ending activities


Activity ES EF LS LF SlackA 0 1B 1 7C 1 4D 7 9E 9 12F 4 8G 12 13 13

EARLIEST START SOLUTIONEARLIEST START SOLUTION

AAEEDDBB

CC FFGG

1

6 2 31

43


Activity ES EF LS LF SlackA 0 1 0 1B 1 7 1 7C 1 4 4 7D 7 9 7 9E 9 12 9 12F 4 8 7 12G 12 13 12 13

LATEST FINISH SOLUTIONLATEST FINISH SOLUTION

AAEEDDBB

CC FF

GG

1

6 2 3

1

43





● Total float: Measure of leeway (delay) in starting and completing an activity. It assumes that all activities preceding that activity finished as Early as possible and all successor activities are started as Late as possible. FREE TIME WITHOUT DELAYING THE WHOLE PROJECT DURATION

● Free float: Property of an activity and not the network path that an activity is part of. It is the amount of time that an activity’s start can be delayed with out affecting the early start date of any successor activity in the network. FREE TIME WITHOUT DELAYING THE EARLY START OF SUCCEESOR ACTIVITY




Activity ES EF LS LF Slack A 0 1 0 1 0 B 1 7 1 7 0 C 1 4 5 8 4 D 7 9 7 9 0 E 9 12 9 12 0 F 4 8 8 12 4 G 12 13 12 13 0



CRITICAL PATHCRITICAL PATH

AA

EEDDBB

CC FF

GG

1

6 2 3

1

43


NEW NOTATION

● Compute ES, EF for each activity, Left to Right

● Compute, LF, LS, Right to Left

C 7C 7LS LF

ES EF


EXHIBIT 2.6, P.35

A 21A 21

E 5E 5D 2D 2B 5B 5

C 7C 7 F 8F 8

G 2G 2


A 21A 21

E 5E 5D 2D 2B 5B 5

C 7C 7 F 8F 8

G 2G 2

21 28 28 36

36 38

28 3326 2821 26

0 21

F cannot start until C and D are done.G cannot start until both E and F are done.

EXHIBIT 2.6, P.35


A 21A 21

E 5E 5D 2D 2B 5B 5

C 7C 7 F 8F 8

G 2G 2

21 26

0 21

26 28 31 36

36 38

21 28 28 36

21 28 28 36

36 38

28 3326 2821 26

0 21

E just has to be done in time for G to start at 36, so it has slack.D has to be done in time for F to go at 28, so it has no slack.

EXHIBIT 2.6, P.35


A 21A 21

E 5E 5D 2D 2B 5B 5

C 7C 7 F 8F 8

G 2G 2

21 26

0 21

26 28 31 36

36 38

21 28 28 36

21 28 28 36

36 38

28 3326 2821 26

0 21

EXHIBIT 2.6, P.35


GANTT CHART - ES

0 5 10 15 20 25 30 35 40

A

B

C

D

E

F

G


CAN WE GO FASTER?


TIME-COST MODELS

1. Identify the critical path2. Find cost per day to expedite each node on

critical path.3. For cheapest node to expedite, reduce it as

much as possible, or until critical path changes.4. Repeat 1-3 until no feasible savings exist.


What about Uncertainty?


PERT ACTIVITY TIMESPERT ACTIVITY TIMES

● 3 time estimates• Optimistic times (a)• Most-likely time (m)• Pessimistic time (b)

● Follow beta distribution● Expected time: t = (a + 4m + b)/6● Variance of times: v = (b - a)2/36


PROJECT TIMESPROJECT TIMES

● Expected project time (T)• Sum of critical path

activity times, t

● Project variance (V)• Sum of critical path

activity variances, v

6

4 bmaET

36

22 ab


EXAMPLEEXAMPLE

Activitya m b E[T] varianceA 2 4 8 4.33 1B 3 6.1 11.5 6.48 2C 4 8 10 7.67 1

Project 18.5 4

CCBBAA4.33 6.48 7.67


BENEFITS OF PERT/CPMBENEFITS OF PERT/CPM

● Useful at many stages of project management

● Mathematically simple● Use graphical displays● Give critical path & slack time● Provide project documentation● Useful in monitoring costs


LIMITATIONS OF PERT/CPMLIMITATIONS OF PERT/CPM

● Clearly defined, independent & stable activities

● Specified precedence relationships● Activity times (PERT) follow beta

distribution● Subjective time estimates● Over emphasis on critical path


Risk Management


WHAT IS RISK?A risk is a potential problem characterised by:

(a) A likelihood of occurrence(b) A potential impact


SOURCES OF RISK

1. Use of new or untried technology

2. Inexperienced team3. Poor Project management

structure4. Lack of resource or resource

conflicts5. Work takes longer than planned6. Deliveries from supplier late7. Insufficient production facilities8. Placing of subcontract and

purchase orders

10. Replace key, sick or holidaying personnel

11. Weather may delay work12. Labour disputes may delay work13. Poor cost estimates14. Currency conversion rates may

changes15. Interfaces with other people,

departments and companies.16. Pressure from NGOs, Politicians,

Crooks17. Global Weather Changes18. Natural Disasters


RISK ASSESSMENT MAP

Impact

Probability

Low Medium High

High ?Medium

Low ?


Management Structure


FUNCTIONAL, PROJECT AND MATRIX ORGANIZATIONAL STRUCTURES


ORGANIZATION STRUCTURE INFLUENCES ON PROJECTS

Organization Type Project Characteristics

Functional

Matrix Projectized Weak Matrix Balanced

Matrix Strong Matrix

Project Manager's Authority

Little or None

Limited Low to Moderate

Moderate To High

High to Almost Total

Percent of Performing Organization's Personnel Assigned Full- time to Project Work

Virtually None

0-25%

15-60%

50-95%

85-100%

Project Manager's Role Part-time Part-time Full-time Full-time Full-time Common Title for Project Manager's Role

Project Coordinator/ Project Leader

Project Coordinator/ Project Leader

Project Manager/ Project Officer

Project Manager/ Program Manager

Project Manager/ Program Manager

Project Management Administrative Staff

Part-time

Part-time

Part-time

Full-time

Full-time

The organizational structure influences the project manager’s authority, but remember to address the human resources, political, and symbolic frames, too.

PMBOK Guide, 1996, p. 18


DISTINCTIONS BETWEEN PROJECT AND FUNCTIONAL MANAGEMENT

– Job of functional managers go on forever

– They operate and optimise the use of resources of overall company basis

– Job of project managers is over once project is finished

– They optimise resources of a project

– Different definitions of optimisation may lead to conflicts


ADVANTAGES OF PROJECT MANAGEMENT ORGANISATIONAL APPROACH

● Teamwork- better motivation & Communication

● Synergism- high performing team● Cross-Border management- diff cultures,

functions and boundaries● Forward Looking- what else needs doing● Clent Relations- one point of contact● Results – more effective


Project Measurement


EARNED VALUE MANAGEMENT SYSTEMS

(EVMS)

Presented BySean Alexander(703) 503-5000 or (888) 860-0700

[email protected]

BASIC CONCEPTS


EVMS OBJECTIVES

● Plan all work prior to beginning it● Measure performance based on an

objective set of technical criteria● Analyze schedule status and projections

using a time phased CPM network● Analyze the expenditure of funds in light of

the work accomplished (not work scheduled)


EVMS OBJECTIVES

● Isolate problems:– Quantify technical problems within the context of cost

and schedule parameters;– Not aimed at replacing or changing the process for

technical problem detection;

● Forecast completion date and final cost;● Take corrective action;● Maintain disciplined control of the

performance measurement baseline.


BUDGET STRUCTURE

Negotiated Changes

Written Change Authorization, Not

Negotiated

Profit/Fee

Contract CostAuthorized,

Unpriced Work

Distributed Budget[S of all CAs]

Undistributed BudgetManagement Reserve

Performance Measurement Baseline(PMB)

Contract Budget Base(CBB)

Contract


EARNED VALUE TERMINOLOGY

Data Element Term AcronymScheduled Work Budgeted Cost for Work Scheduled BCWS

Earned Value Budgeted Cost for Work Performed BCWP

Actuals Actual Cost of Work Performed ACWP

Authorized Work Budget At Completion BAC

Forecasted Cost Estimate At Completion EAC

Work Variance Schedule Variance SV

Cost Variance Cost Variance CV

Completion Variance

Variance At Completion VAC


0

1000

2000

3000

4000

5000

6000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun

EARNED VALUE DATA ELEMENTS

T/N

Cost Variance Schedule Variance

ProjectedProgramDelay

VAC

EAC

BAC(PMB)

CBB

MR

ACWP

BCWP

BCWS

ETC

Schedule Slip


Control Account

Software Engineering

CWBS/OBS INTEGRATION

WorkPackages

PlanningPackages

OBS DATA SUMMARIZATION

SOFTWAREINTEGRATIONPROGRAM

Product Development

Master Planning

AdaProducts

Software Tools

Standards

CPCI #1MOS

CPCI #2MOLE

CPCI #3MAC

AdaStudy

AdaConversion

AdaApproach

AdaApplications

Secure Systems

LAN Applications

Marketing

BCWSBCWPACWPBACEAC

FUNCTIONALORGANIZATION

CWBSEXTENSION

SELECTEDREPORTINGELEMENTS

SELECTEDPSWBSELEMENTS

Hardware Engineering

Engineering

Operations

WBS DATA SUMMARIZATION

VP/GM

Control Account

Control Account

Control Account

Control Account

Control Account


CONTROL ACCOUNT ELEMENTS

Work PackagesDetailed, short-span tasks, or

material items, required to

accomplish the CA objectives,

typically in the near term

Task 1

Task 2

Task 4Task 5

Task 3

Work Packages

Planning Packages

Planning Packages

Future work that has not

been detail planned as work

packages. They are always

scheduled to occur in the

future.


EARNED VALUE TECHNIQUES

A predetermined amount of value, i.e. budget, that is claimed, or earned, when the corresponding work is accomplished. The budget value is earned in one of the following ways: 0/100 X/Y Percent

25/75 40/60 50/50

Milestone Weights

Milestone Weights withPercent Complete

% Complete Subjective Estimate Objective Indicators

Apportioned Effort Level of Effort


Budgets vs Funds


BCWS vs ETC

● Budgeted Cost for Work Scheduled (BCWS)– Time phased budget spread of required resources for

the entire task.– Forms the Performance Measurement Baseline (PMB).

● Estimate To Complete (ETC)– Funding required to complete remaining work.– When added to ACWP, it results in the EAC.


EAC

THE PLAN (BCWS) AND THE ETC

BCWS

ETC

BAC/

The BCWS & BAC represent the work. The ETC & EAC represent the funds (i.e., money) required for that work.


BAC vs EAC

● Budget At Completion (BAC)– Budgetary number representing ALL authorized work

(i.e., the SOW).– Cannot change without a change to the SOW, or

appropriate approval.

● Estimate At Completion (EAC)– Funding number representing ALL the money that

will be spent.– Can change without a commensurate change to the

SOW.


BUDGET VS FUNDS

BudgetBudget

A number written on a piece of paper

Cannot be spent

BCWS

BCWP

BAC

A number written on a piece of paper

Cannot be spent

BCWS

BCWP

BAC

FundsFunds

Actuals

Expenditures & estimates of future spending

ETC

ACWP

EAC

Actuals

Expenditures & estimates of future spending

ETC

ACWP

EAC


PCUM

DATA ANALYSIS RELATIONSHIPS

Term Formula

Percent Complete

Cost Performance Indexor Performance Factor

Checklist Actions

Ratio of work accomplished in terms of the total amount of work to do.

Symbol

% Done

CPI or PF

TCPI or VF

BCWPBAC

Average PerformanceBCWPcum

Duration (wks or mos) Since ACWP Began

BCWPcumDuration (wks or mos)

From Time Now to Manager's Stated Completion Date

SC or S/CSchedule Correlation

BCWPACWP

Ratio of work accomplished against money spent (an efficiency rating: Work Done for Resources Expended)

To CompletePerformance Index

or Verification Factor

BAC - BCWPEAC - ACWP

Ratio of work remaining against money remaining (Efficiency which must be achieved to complete the remaining work with the expected remaining money)

Schedule Performance Index SPI Ratio of work accomplished against what should have been done (Efficiency Rating: Work done as compared to what should have been done)

BCWPBCWS

SV

Ratio of Schedule Variance (SV) in terms of average amount of work accomplished (in weeks or months). It indicates a correlation to program true schedule condition

IEACIndependent EstimateAt Completion

BACPF

Calculation of a projected Estimate At Completion to compare with the CAM's Estimate At Completion:1) Ration of total work to be done against experienced cost efficiency2) Sunk costs added to a ratio of remaining work against weighted cost and schedule efficiencies

1)

2)BAC - BCWP.8CPI + .2SPI

ACWP +

Average Expected Performance To Finish

Average rate at which work has been accomplished since work began

Average rate at which work must be accomplished in the future to finish on the date the CAM has forecasted for completion of the work.P TO GO

PCUM


BENEFITS OF EVMS

● Clear definition of work prior to beginning that work– Helps the line manager credibly request appropriate

resources– Provides the basis for a realistic plan against which to

measure performance


BENEFITS OF EVMS

● Objective measurement of work accomplishment– Helps the line manager develop plans that are rooted

in reality• If the task can be done within scope, schedule, budget; confidence

in a successful outcome is increased• If the task cannot be done within scope, schedule, budget; that

problem can be defined and resolved at a time when the resolution will be reasonably inexpensive

– Assists the line manager to request needed help– Assists program and functional management to

identify areas requiring additional management attention


BENEFITS OF EVMS

● Provides true cost condition– Side-steps false cost variances– Encourages realistic projections of final cost– Enhances accuracy of funding forecasts


● Reduces propensity of customer/boss to add work without adding budget– Ties budget directly to work– Requires all work transfers to include associated budget– Requires all budget transfers to include associated work

● Fosters management decisions within a framework of reality, rather than latent unease

BENEFITS OF EVMS


0

1000

2000

3000

4000

5000

6000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun

EARNED VALUE DATA ELEMENTS

Time Now

Cost Variance Schedule Variance

ProjectedProjectDelay

Variance at Completion(VAC)

Estimate at Completion(EAC)

Budget at Completion(BAC)

Project Budget BaseManagement Reserve

ACWP

BCWP

BCWS

ETC

Schedule Slip


EARNED VALUE TERMINOLOGY

Data Element Term AcronymScheduled Work Budgeted Cost for Work Scheduled BCWS

Earned Value Budgeted Cost for Work Performed BCWP

Actuals Actual Cost of Work Performed ACWP

Authorized Work Budget At Completion BAC

Forecasted Cost Estimate At Completion EAC

Work Variance Schedule Variance SV

Cost Variance Cost Variance CV

Completion Variance

Variance At Completion VAC


EARNED VALUE EXERCISE – FENCE PROJECT

Calculation of Earned Value


Project Communications Management


IMPORTANCE OF GOOD COMMUNICATIONS

● The greatest threat to many projects is a failure to communicate

● Strong verbal skills are a key factor in career advancement for Project Managers


PROJECT COMMUNICATIONS MANAGEMENT PROCESSES

● Communications planning: determining the information and communications needs of the stakeholders

● Information distribution: making needed information available in a timely manner

● Performance reporting: collecting and disseminating performance information

● Administrative closure: generating, gathering, and disseminating information to formalize phase or project completion


COMMUNICATIONS PLANNING

● Every project should include some type of communications management plan, a document that guides project communications

● Creating a stakeholder analysis for project communications also aids in communications planning


COMMUNICATIONS MANAGEMENT PLAN CONTENTS

● A description of a collection and filing structure for gathering and storing various types of information

● A distribution structure describing what information goes to whom, when, and how

● A format for communicating key project information● A project schedule for producing the information● Access methods for obtaining the information● A method for updating the communications

management plans as the project progresses and develops

● A stakeholder communications analysis


INFORMATION DISTRIBUTION

● Getting the right information to the right people at the right time and in a useful format is just as important as developing the information in the first place

● Important considerations include– using technology to enhance information

distribution– formal and informal methods for distributing

information


PERFORMANCE REPORTING

● Performance reporting keeps stakeholders informed about how resources are being used to achieve project objectives– Status reports describe where the project stands at a

specific point in time– Progress reports describe what the project team has

accomplished during a certain period of time– Project forecasting predicts future project status and

progress based on past information and trends– Status review meetings often include performance

reporting


CASE-STUDY LYNAS - WHAT ARE THE ISSUES?


LYNAS CASE-STUDY – GROUP WORK

● Use the internet to get all the information● Identify project stakeholders● What are the issues?● What are project benefits?● What are the project risks? (major &

minor)● Why are there conflicts?● How to resolve conflicts?● How can management inform the public?


ADMINISTRATIVE CLOSURE

● A project or phase of a project requires closure

● Administrative closure produces– project archives– formal acceptance– lessons learned


SUGGESTIONS FOR IMPROVING PROJECT COMMUNICATIONS

● Resolve conflicts effectively● Develop better communication skills● Run effective meetings● Use templates for project communications


CONFLICT HANDLING MODES IN ORDER OF PREFERENCE

● Confrontation or problem-solving: directly face a conflict

● Compromise: use a give-and-take approach● Smoothing: de-emphasize areas of differences

and emphasize areas of agreement● Forcing: the win-lose approach● Withdrawal: retreat or withdraw from an actual

or potential disagreement


Project Closure


WHAT IS INVOLVED IN CLOSING PROJECTS?

● Closing processes include gaining stakeholder acceptance of the final product and bringing the project or phase to an orderly end

● Closing verifies that all of the deliverables have been completed

● A project audit is often done


TRANSITION PLANNING● It is important to plan for and execute a

smooth transition of the project into the normal operations of the company

● Most projects produce results that are integrated into the existing organizational structure

● Some projects require the addition of new organizational structures

● Some projects end by extinction or starvation


ADMINISTRATIVE CLOSURE

● Administrative closure involves– verifying and documenting project results to

formalize acceptance of the products produced– collecting project records– ensuring products meet specifications– analyzing whether the project was successful and

effective– archiving project information for future use


FINAL REPORT OUTLINE

● Cover page● Table of contents and executive summary (for a long report)● Need for the project● Project description and letter of agreement ● Overall outcome of the project and reasons for success or failure● Project management tools and techniques used and assessment

of them● Project team recommendations and future considerations● Final project Gantt chart● Attachments with all deliverables


Closing Remarks


CURRENT & FUTURE OF PM(- Pinto and Kharbanda 1995)

• PM approach will replace functional line management• Globalisation needs PM approach• Trend towards flat, flexible organisation• PM used as competitive weapon• PM concept changes from

decision maker, boss director to leader, coach & facilitator


THE END


PETRONAS TWIN TOWERS

● Identify the PETRONAS Twin Towers’ stakeholders, their roles and interests.

● Discuss the risks faced during the project management processes of the PETRONAS Twin Towers.

● Appraise the mitigation to the above risks in terms of innovations.


BOSCH POWER TOOLS: THE DELTA-SANDER PROJECT (A)

● What are the problems facing the Bosch Delta-Sander project?

● What are the steps required by Mr. Klaus Huttelmaier in order to rectify the problems?

● Should the Bosch Delta-Sander be exhibited in Cologne? Give your opinions.


INDIVIDUAL ASSIGNMENT

● “When management does not speak with one voice, then it becomes a peripheral opponent to the team’s mission”. Discuss.

● Why do you think SC still implemented Construction Management approach although the SC management team was facing various issues throughout the SC project?

Documents

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