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PROJECT MANAGEMENT:Project Life Cycle, Work Breakdown Structure

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Production and Operations Management ­MGT613
VU
Lesson 43
PROJECT MANAGEMENT
Learning Objectives
After completing our lectures 43 and 44, we should be able to understand the Behavioral aspects of
projects in terms of project personnel and the project manager. We should be able to appreciate the
nature and importance of work breakdown structure in Project Management. We should develop a
working knowledge of PERT/CPM techniques.
Construct simple network diagrams and try to assimilate the kind of information that a PERT or
CPM analysis can provide. And last but not the least we should be able to analyze networks with
probabilistic times and describe activity "crashing" and solve some problems.
Projects
Projects are unique, one-time (temporary) operations designed to accomplish a specific set of
objectives in a limited time frame.
This property of being a temporary and a one-time venture contrasts with operations,
which are permanent or semi-permanent ongoing functional work to create the same product or
service over-and-over again.
The management of these two systems is often very different and requires varying technical skills
and philosophy, hence requiring the development of project management
Project Management
Project Management is the organizing and managing resources in such a way that these resources
deliver all the work required to complete a project within defined scope, time, and cost constraints.
A project is a temporary and one-time endeavor undertaken to create a unique product or service.
Distinguishing characteristics of Project Management
1. How is it different?
Limited time frame
Narrow focus, specific objectives
Less bureaucratic
2. Why is it used?
Special needs
Pressures for new or improves products or services
3.  Project Management has the following important key metrics
Time
Cost
Performance objectives
Key Success Factors
What are the Key Success Factors.
1. Top-down commitment
2. Having a capable project manager
3. Having time to plan
4. Careful tracking and control
5. Good communications
Project Management has certain major administrative issues, such as
1. Executive responsibilities
2. Project selection
3. Project manager selection
4. Organizational structure
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Production and Operations Management ­MGT613
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5. Organizational alternatives
6. Manage within functional unit
7. Assign a coordinator
8. Use a matrix organization with a project leader
Project Management normally involves the knowledge of Project management tools, Work
breakdown structure, Network diagram, Gantt charts and Risk management.
Project Management: Hospital
We are given the task of setting up a hospital facility in our community. The plan is to set up both
medicine and surgery facilities related to all important fields of medicine and surgery. The project
Managers are required to list the possible activities in the form of
Planning and Scheduling (Gantt Chart) and Network Diagram AON and AOA Activities
M
AP
M
JU
JU
A
SE
O
N
DE
Gantt chart
A
R
AY
N
L
U
P
CT
O
C
Locate new facilities
Interview staff
Hire and train staff
Select and order Machinery
Remodel and install
machines
Start Attending Patient
Project Management: Hospital Construction and Operation Activities include:
Locate new facilities
Interview staff
Hire and train staff
Select and order Machinery
Remodel and install phones
Start Patient Examination/startup
Network Diagrams and Conventions
a
b
a
c
c
b
a
c
a
c
Dummy
b
activity
b
d
Project Network ­ Activity on Arrow
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Production and Operations Management ­MGT613
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Order
4
furnitur
Furniture
2
Locate
setup
facilitie
Remodel
1
5
6
Move
in
Intervie
Hire and
train
3
Project Network ­ Activity on Node
Order
furniture
Furniture
Locate
2
setup
facilities
6
1
Move
Remodel
In
5
S
7
Hire and
Interview
train
4
3
Activity on Arrow: The Network diagram convention in which arrows designate
activities.
Activity on Node: The Network diagram convention in which the nodes designate
the activities.
Activities: Project steps that consume or utilize resources (and or time).
Events: The starting and finishing of activities designated by nodes in the Activity
on Arrow notation.
Path: 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 path; the difference the length of path and the length
of critical path
Critical
Slack
Path
Length
(weeks)
1-2-3-4-5-6
18
2
1-2-5-6
20
0
1-3-5-6
14
6
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Project Life Cycle
The Project Life Cycle comprises of a new concept idea for a unique activity which is then
evaluated through feasibility reports, planned with certain sequence of activities, execution of
activities and terminated after the project has been completed or shelved due to certain unavoidable.
What is important is to note that all stages of Project Life Cycle are administered and handled by
competent Project Management team or Project Managers.
M
Feasibilit
A
N
A
Plannin
G
Concep
E
M
E
Executio
N
T
Terminatio
Planning and Scheduling involves the following key decisions:
Deciding which projects to implement
Selecting a project manager
Selecting a project team
Planning and designing the project
Managing and controlling project resources
Deciding if and when a project should be terminated
Responsibilities of a Project Manager
Project Manager is normally considered responsible for:
Project Management
Responsible for: Technical and Financial Analysis
Project Manager is normally considered to have qualification such as
PMP certification
CFM, CFA and CFP certification
Project Manager should be skilled enough to carryout or supervise the calculation of
Financial Evaluation and Investment Analysis
Cost Benefit Analysis
Project Managers should be able to focus on Ethical Issues and avoid:
Temptation to understate costs
Withhold information
Misleading status reports
Falsifying records
Compromising workers' safety
Approving substandard work
Work Breakdown Structure
A project is different that operations due to its unique nature. A good project management practice
is to breakdown the project into sublevel or group of similar activities. These sublevel or group of
similar activities is called Work Breakdown Structure.
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The work breakdown structure usually represents a Parent Child Activity with
the relationship between a parent and child level being easily identifiable. The work break down
structure allows a project manager to incorporate more administrative control over the project
activities.
Project
Level 1
Level 2
Level 3
Level 4
PERT and CPM
PERT:
Program Evaluation and Review Technique
CPM:
Critical Path Method
1.
Graphically displays project activities
2.
Estimates how long the project will take
3.
Indicates most critical activities
4.
Show where delays will not affect project
Advantages of PERT
1.
Forces managers to organize
2.
Provides graphic display of activities
3.
Identifies
4.
Critical activities
5.
Slack activities
Limitations of PERT
1.
Important activities may be omitted
2.
Precedence relationships may not be correct
3.
Estimates may include a fudge factor
4.
May focus solely on critical path
Project Scope and Scope Creep
Project Scope refers to the total work needed out of a project. The primary tool required to describe
Project Scope is the Work Breakdown Structure. Often projects suffer from an irritant known as scope
creep. Scope creep is the unnecessary extension of project scope which does not allow the project to be
completed within budget and with in the time limits. Organizations incorporate special management
techniques to isolate and eliminate scope creep. Senior Management is advised and trained by outside
consultants to avoid decisions which lead to increase in business scope creep or technical scope creep.
Technical Scope creep ( like Gold plating) is the unfortunate tendency of technical side to add certain
avoidable and costly features in their products ( services or softwares) to make their product or service
more powerful and attractable to the customers. Business Scope creep (often called customer pleasing)
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is the tendency of the business managers to over do the customer relationship with their customers. A
pragmatic strategy to avoid scope creep is to be judicious to the original project scope and religiously
avoid uncalled for business or technical additions that may incorporate scope creep.
Summary
We learnt the Project Management concept to be different and unique from operations side. Operations
represent a repetition of same activities while projects represent execution of unique activities. However
there exist similarities which include administration of activities by project manager in a similar fashion
to the activities performed by the operations manager. We discussed the Network Diagrams, an Hospital
example Project in terms of Gantt Chart, Work Breakdown Structure and job responsibilities of a
Project Manager.
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Table of Contents:
  1. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT
  2. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT:Decision Making
  3. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT:Strategy
  4. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT:Service Delivery System
  5. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT:Productivity
  6. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT:The Decision Process
  7. INTRODUCTION TO PRODUCTION AND OPERATIONS MANAGEMENT:Demand Management
  8. Roadmap to the Lecture:Fundamental Types of Forecasts, Finer Classification of Forecasts
  9. Time Series Forecasts:Techniques for Averaging, Simple Moving Average Solution
  10. The formula for the moving average is:Exponential Smoothing Model, Common Nonlinear Trends
  11. The formula for the moving average is:Major factors in design strategy
  12. The formula for the moving average is:Standardization, Mass Customization
  13. The formula for the moving average is:DESIGN STRATEGIES
  14. The formula for the moving average is:Measuring Reliability, AVAILABILITY
  15. The formula for the moving average is:Learning Objectives, Capacity Planning
  16. The formula for the moving average is:Efficiency and Utilization, Evaluating Alternatives
  17. The formula for the moving average is:Evaluating Alternatives, Financial Analysis
  18. PROCESS SELECTION:Types of Operation, Intermittent Processing
  19. PROCESS SELECTION:Basic Layout Types, Advantages of Product Layout
  20. PROCESS SELECTION:Cellular Layouts, Facilities Layouts, Importance of Layout Decisions
  21. DESIGN OF WORK SYSTEMS:Job Design, Specialization, Methods Analysis
  22. LOCATION PLANNING AND ANALYSIS:MANAGING GLOBAL OPERATIONS, Regional Factors
  23. MANAGEMENT OF QUALITY:Dimensions of Quality, Examples of Service Quality
  24. SERVICE QUALITY:Moments of Truth, Perceived Service Quality, Service Gap Analysis
  25. TOTAL QUALITY MANAGEMENT:Determinants of Quality, Responsibility for Quality
  26. TQM QUALITY:Six Sigma Team, PROCESS IMPROVEMENT
  27. QUALITY CONTROL & QUALITY ASSURANCE:INSPECTION, Control Chart
  28. ACCEPTANCE SAMPLING:CHOOSING A PLAN, CONSUMER’S AND PRODUCER’S RISK
  29. AGGREGATE PLANNING:Demand and Capacity Options
  30. AGGREGATE PLANNING:Aggregate Planning Relationships, Master Scheduling
  31. INVENTORY MANAGEMENT:Objective of Inventory Control, Inventory Counting Systems
  32. INVENTORY MANAGEMENT:ABC Classification System, Cycle Counting
  33. INVENTORY MANAGEMENT:Economic Production Quantity Assumptions
  34. INVENTORY MANAGEMENT:Independent and Dependent Demand
  35. INVENTORY MANAGEMENT:Capacity Planning, Manufacturing Resource Planning
  36. JUST IN TIME PRODUCTION SYSTEMS:Organizational and Operational Strategies
  37. JUST IN TIME PRODUCTION SYSTEMS:Operational Benefits, Kanban Formula
  38. JUST IN TIME PRODUCTION SYSTEMS:Secondary Goals, Tiered Supplier Network
  39. SUPPLY CHAIN MANAGEMENT:Logistics, Distribution Requirements Planning
  40. SUPPLY CHAIN MANAGEMENT:Supply Chain Benefits and Drawbacks
  41. SCHEDULING:High-Volume Systems, Load Chart, Hungarian Method
  42. SEQUENCING:Assumptions to Priority Rules, Scheduling Service Operations
  43. PROJECT MANAGEMENT:Project Life Cycle, Work Breakdown Structure
  44. PROJECT MANAGEMENT:Computing Algorithm, Project Crashing, Risk Management
  45. Waiting Lines:Queuing Analysis, System Characteristics, Priority Model