Lecture Fundamentals of operations management (4/e): Chapter 4 - Davis, Aquilano, Chase

Chapter supplement 3 Project management, after studying this chapter you will be able to: Recognize that project management involves both people skills to coordinate and motivate individuals from a range of disciplines and technical skills to properly plan and schedule a project, explain the role of the project manager in organizing and coordinating all activities performed in a project, introduce critical path scheduling as a tool for identifying activities that require immediate attention,...

DAVIS F   O   U   R   T   H       E   D   I   T   I   O   N AQUILANO CHASE supplement Project Management PowerPoint Presentation by Charlie Cook © The McGraw-Hill Companies, Inc., 2003 Supplement Objectives Supplement Objectives • Recognize that project management involves both people skills to coordinate and motivate individuals from a range of disciplines and technical skills to properly plan and schedule a project • Explain the role of the project manager in organizing and coordinating all activities performed in a project • Introduce critical path scheduling as a tool for identifying activities that require immediate attention • Identify the time–cost trade-offs involved in expediting the completion of a project • Discuss some of the criticisms often associated with project © The McGraw­Hill  management techniques Fundamentals of Operations  Management 4e  Companies, Inc., 2003 S3–2 Definition of Project Management Definition of Project Management • Project –Series of related jobs or tasks focused on the completion of an overall objective • Project Management –Planning, directing, and controlling resources to meet the technical, cost, and time constraints of the project • Program –Synonym for a project, although it also can consist of several interrelated projects © The McGraw­Hill  Fundamentals of Operations  Companies, Inc., 2003 Management 4e  S3–3 Project Management: Key Terms Project Management: Key Terms • Task (Activity) –A subdivision of a project perform by one group or organization • Subtask –Used to break a project into more meaningful pieces • Work Package –A group of activities combined to be assignable to a single organizational unit ã Milestones âTheMcGrawưHill Specific events to be reached at points in time Fundamentals of Operations  Companies, Inc., 2003 Management 4e  S3–4 Work Breakdown Structure Work Breakdown Structure • Work Breakdown Structure –Method by which a project is divided into tasks and subtasks Level Program Project Task Subtask Work Package © The McGraw­Hill  Fundamentals of Operations  Companies, Inc., 2003 Management 4e  S3–5 Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.1 S3–6 Key Factors in a Breakdown Structure Key Factors in a Breakdown Structure • Allow the activities to be worked on independently • Make them of manageable size • Give authority to carry out the program • Monitor and measure the program • Provide the required measures Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 S3–7 Organizational Considerations in  Organizational Considerations in  Project Management Project Management • Role of the Project Manager –Using social and technical skills to manage across traditional functional lines to create a collaborative culture • High-Performance Project Teams –Creating a successful team requires consideration of: • Task-related variables • People-related variables • Leadership variables • Organization variables Fundamentals of Operations  Management4e âTheMcGrawưHill Companies,Inc.,2003 S38 OrganizationalConsiderationsin OrganizationalConsiderationsin ProjectManagement(contd) ProjectManagement(contd) ã Barriers to High Team Performance: –Different points of view –Role conflicts Power struggles FundamentalsofOperations Management4e âTheMcGrawưHill Companies,Inc.,2003 S39 ProjectControl ProjectControl ã Gantt Chart –Graphical technique that shows the amount of time required for each activity and the sequence in which the activities are to be performed Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 S3–10 CPM Network for Computer Design Project CPM Network for Computer Design Project Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.4 S3–22 CPM with Three Activity Time Estimates CPM with Three Activity Time Estimates Step 1: Identify activities Step 2: Sequence activities and construct network Step 3: Determine the three time estimates for each activity a = optimistic time m = most likely time b = pessimistic time Step 4: Calculate the expected time (ET) for each activity ET a 4m b © The McGraw­Hill  Fundamentals of Operations  Management 4e  Companies, Inc., 2003 S3–23 Typical Beta Curves Typical Beta Curves Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.5 S3–24 CPM with Three Activity Time Estimates CPM with Three Activity Time Estimates Step 5: Calculate the variance (σ2) for each activity b a Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.6 S3–25 CPM with Three Activity Time Estimates CPM with Three Activity Time Estimates Step 6: Identify all of the paths in the network and their estimated completion times and variances Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.7 S3–26 CPM with Three Activity Time Estimates CPM with Three Activity Time Estimates Step 7: Determine the probability of completing the project by a certain date Z D ET p p D = Desired completion date for the project ETp = Expected completion time for the path σp = Standard deviation © The McGraw­Hill  for the path Fundamentals of Operations  Management 4e  Companies, Inc., 2003 S3–27 Probability of Each Path Being  Probability of Each Path Being  Completed in 39 Weeks or Less Completed in 39 Weeks or Less Fundamentals of Operations  Exhibit S3.8a Management 4e  © The McGraw­Hill  Companies, Inc., 2003 S3–28 Probability of Each Path Being Completed  Probability of Each Path Being Completed  in 39 Weeks or Less (cont’d) in 39 Weeks or Less (cont’d) Fundamentals of Operations  Exhibit S3.8b Management 4e  © The McGraw­Hill  Companies, Inc., 2003 S3–29 Path Values and Probabilities of Completing  Path Values and Probabilities of Completing  Each Path in 39 Weeks or Less Each Path in 39 Weeks or Less Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.9 S3–30 Time­Cost Trade­off Models Time­Cost Trade­off Models • Time-Cost Trade-off Model –A model that develops the relationship between direct project costs, indirect costs, and time to complete the project by minimizing the sum of direct and indirect costs • Crash Costs –The additional costs of an activity when time to complete it is shortened Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 S3–31 Minimum­Cost Scheduling Minimum­Cost Scheduling Step 1: Prepare CPM-type network diagram a Normal cost (NC) b Normal time (NT) c Crash time (CT) d Crash Cost (CC) Step 2: Determine the cost per unit of time to expedite (or crash) each activity Step 3: Compute the critical path Step 4: Shorten the critical path at the least cost Step 5: Plot project direct, indirect, and total-cost curves © The McGraw­Hill  and find the minimum-cost schedule Fundamentals of Operations  Companies, Inc., 2003 Management 4e  S3–32 Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.10 S3–33 Calculation of Cost Per Day to Expedite  Calculation of Cost Per Day to Expedite  Each Activity Each Activity Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.11 S3–34 Reducing Project Completion Time  Reducing Project Completion Time  One Day at a Time One Day at a Time Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.12 S3–35 Plot of Costs and Minimum Cost Schedule Plot of Costs and Minimum Cost Schedule Fundamentals of Operations  Management 4e  © The McGraw­Hill  Companies, Inc., 2003 Exhibit S3.13 S3–36 ... trade-offs involved in expediting the completion of a project • Discuss some of the criticisms often associated with project © The McGraw­Hill  management techniques Fundamentals? ?of? ?Operations? ? Management? ?4e ... Task Subtask Work Package © The McGraw­Hill  Fundamentals? ?of? ?Operations? ? Companies, Inc., 2003 Management? ?4e  S3–5 Fundamentals? ?of? ?Operations? ? Management? ?4e  © The McGraw­Hill  Companies, Inc., 2003... Fundamentals? ?of? ?Operations? ? Companies, Inc., 2003 Management? ?4e  S3–19 CPM Network for Computer Design Project CPM Network for Computer Design Project Fundamentals? ?of? ?Operations? ? Management? ?4e