PRODUCTIONS/OPERATIONS MANAGEMENT

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Lecture
4
Project Management Chapter 17
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Project Management

• How is it different?
• Limited time frame
• Narrow focus, specific objectives
• Why is it used?
• Special needs
• Pressures for new or improves products or services

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Project Management

• What are the Key Metrics
• Time
• Cost
• Performance objectives
• What are the Key Success Factors?
• Top-down commitment
• Having a capable project manager
• Having time to plan
• Careful tracking and control
• Good communications

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Project Management

• What are the tools?
• Work breakdown structure
• Network diagram
• Gantt charts
• Risk management

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Planning and Scheduling
Gantt Chart
Locate new facilities Interview staff Hire and
train staff Select and order furniture Remodel
and install phones Move in/startup
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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

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Project Manager

• Responsible for

Work Quality Human Resources Time Communicat
ions Costs
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Ethical Issues

• Temptation to understate costs
• Withhold information
• Misleading status reports
• Falsifying records
• Compromising workers safety
• Approving substandard work

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Project Life Cycle
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Work Breakdown Structure
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PERT and CPM

• PERT Program Evaluation and Review Technique
• CPM Critical Path Method
• Graphically displays project activities
• Estimates how long the project will take
• Indicates most critical activities
• Show where delays will not affect project

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The Network Diagram

• Network (precedence) diagram
• Activity-on-arrow (AOA)
• Activity-on-node (AON)
• Activities
• consume resources and/or time
• Events
• points in time

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Project Network Activity on Node
Figure 17.4
AON
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The Network Diagram (contd)

• Path
• Sequence of activities that leads from the
  starting node to the finishing node
• AON path S-1-2-6-7
• 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

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Time Estimates

• Deterministic
• Time estimates that are fairly certain
• Probabilistic
• Estimates of times that allow for variation

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Project Network Activity on Node
Figure 17.4
6 weeks
3 weeks
8 weeks
AON
11 weeks
1 week
9 weeks
4 weeks
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Management Scientist Solution
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Example 1 Activity on Arc (AOA) Representation
Figure 17.5
6 weeks
Deterministic time estimates
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Orderfurniture
3 weeks
2
Furnituresetup
8 weeks
Locatefacilities
Remodel
Move in
11 weeks
1
5
6
1 week
Interview
Hire and train
4 weeks
9 weeks
3
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Computing Algorithm

• Network activities
• ES early start
• EF early finish
• LS late start
• LF late finish
• Used to determine
• Expected project duration
• Slack time
• Critical path

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Advantages of PERT

• Forces managers to organize
• Provides graphic display of activities
• Identifies
• Critical activities
• Slack activities

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Limitations of PERT

• Important activities may be omitted
• Precedence relationships may not be correct
• Estimates may include a fudge factor
• May focus solely on critical path