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PROJECT
MANAGEMEN T CHAPTER 14 After studying this chapter, you should be able to: • 14-1 Explain the key issues associated with project management. • 14-2 Describe how to apply the Critical Path Method (CMP). • 14-3 Explain how to make time/cost trade-off decisions in projects. • 14-4 Describe how to calculate probabilities for project completion time using the Project Evaluation and Review Technique (PERT). PROJECT A project is a temporary and often customized initiative that consists of many smaller tasks and activities that must be coordinated and completed to finish the entire initiative on time and within budget. Projects are the major value-creation process, and the major activities in the value chain revolve around projects. PROJECT MANAGEMENT involves all activities associated with planning, scheduling, and controlling projects. Good project management ensures that an organization’s resources are used efficiently and effectively. THE SCOPE OF PROJECT 14-1 MANAGEMENT DEFINE
PLAN
ORGANIZE
CONTROL
CLOSE DEFINE define the project’s: • goal/s; • responsibilities and deliverables; and • timetable (when it must be accomplished)
A common way to capture these information is
with a specific and measurable statement of work. PLAN • breaking down a project into smaller activities and developing a project schedule by estimating the time required for each activity and scheduling them so they meet the project due date. ORGANIZE involves such activities as: • forming a team • allocating resources PROJECT MANAGER • calculating costs provides the leadership to • assessing risk accomplish the project goal • preparing project documentation • ensuring good communications CONTROL CLOSE • assesses how well a • compiling statistics project meets its goals • releasing and/or and objectives and reassigning people makes adjustments as • preparing a “lessons necessary learned” list ROLES OF THE PROJECT MANAGER AND TEAM MEMBERS
Good project managers
recognize that people issues are as important as technical issues. PROJECT MANAGER TEAM MEMBERS • must have sufficient technical • contribute to the project’s expertise goals and objectives • build an effectie team • complete individual tasks • align the project with the within the expected time firm’s strategy frame • direct and supervise the • collaborate with other team conduct of the project from members beginning to end • communicate with the project manager about roadblocks ORGANIZATIONAL STRUCTURE
In a pure project organizational structure, team members are assigned exclusively to projects and report only to the project manager. ORGANIZATIONAL STRUCTURE
A pure functional organizational structure charters projects exclusively within functional departments. In a typical functional organization, a project cuts across organizational boundaries. ORGANIZATIONAL STRUCTURE A matrix organizational structure lends resources to projects while still maintaining control over them. FACTORS FOR SUCCESSFUL PROJECTS TECHNIQUES FOR PLANNING, SCHEDULING, & CONTROLLING 14-2 PROJECTS PROJECT DEFINITION
RESOURCE PLANNING
PROJECT SCHEDULING
PROJECT CONTROL Three factors involved in project management decisions: • time • resources • cost PROJECT DEFINITION • define the project objectives and deliverables • identify the specific activities required to complete the project and the sequence in which they must be performed IMMEDIATE ACTIVITIES PREDECESSORS > activities that must > discrete tasks be completed that consume immediately before an resources and time activity may start
Precedence relationships ensure that activities are
performed in the proper sequence when they are scheduled. WORK BREAKDOWN STRUCTURE • a hierarchical tree of end items that will be accomplished by the project team during the project • breaks a project down into manageable pieces The activities and their sequence are usually represented graphically using a project network. PROJECT NETWORK • consists of a set of circles or boxes called nodes, which represent activities, and a set of arrows called arcs, which define the precedence relationships between activities • called the activity-on-node (AON) network representation
