Chapter 6 Project Management PDF

Chapter 6 Project Management Learning Outcomes At the end of this chapter, you should be able to: Define project management and explain its importance Identify and explain the three stages of project management Construct the PERT network of a project Determine the critical path, critical ac...

Chapter 6 Project Management Learning Outcomes At the end of this chapter, you should be able to: Define project management and explain its importance Identify and explain the three stages of project management Construct the PERT network of a project Determine the critical path, critical activities, earliest event time, latest event time and project completion time Determine the slack for activities of the project Overview of Project Management A project is an interrelated set of activities with definite starting and ending points towards achieving a unique outcome. Three characteristics of a project: 1. Single unit 2. Many related activities 3. Difficult to estimate completion time Project management - planning, scheduling and controlling of resources so that the stages meet the time, costs and technical constraints of the project. Objectives of Project Management To ensure that the project will be completed on time. To minimise the project costs and keep them within the expected budget. To meet the predetermined quality standard. Stages of Project Management Scheduli Controlli Planning ng ng Stages of Project Management 1. Project Planning Includes goal setting, project definition and team organization. Effective planning ensures the successful completion of projects. 2. Project Scheduling Involves sequencing and allocating time to all activities. Relates people, money and supplies to specific activities, besides relating the activities to each other. Stages of Project Management 3. Project Controlling Compare actual performance with the planned performance. Monitor resources, costs, quality and budgets Revise or change prior plans and shift resources to meet the time, costs, and quality demands. Project Management Techniques 1. Program evaluation and review technique (PERT) 2. Critical path method (CPM) 3. Gantt chart PERT and CPM Analysis Purpose of PERT and CPM is to identify critical path(s) and critical activities. PERT and CPM - six common steps: 1. Defining the project and preparing the work breakdown structure. 2. Developing relationships among the activities. 3. Drawing the network that connects all the activities 4. Assigning time and/or cost estimates to each activity 5. Computing the longest time path through the network 6. Using the network to help plan, schedule, monitor, and control the project Draw the Network that Connects All the Activities Two approaches for drawing a project network, i.e. using the activity on node (AON) and the activity on arrow (AOA) approaches. AON - the nodes designate activities. AOA - the arrows represent activities. PERT Analysis using Activity on Node (AON) Network Technique There is one node representing the start of the project and one node representing the project’s finish. All activities in the project will be presented by one node. Arrows are used to show the predecessors for the activities. Example 8.6 The activities, immediate predecessors and time required for a project are shown in Table 8.5. Table 8.5 Activities, predecessors and time required Activity Immediate Predecessor Time (Months) A – 3 B – 5 C – 3 D A, B 3 E B 2 F C 1 G C 3 H E, F 2 Construct the PERT network. Example 8.6 Solution A D Start B E H Finish C F G Identify the Critical Path 1. Earliest Even Time (i) Earliest Start Time(ES) (ii) Earliest Finish Time (EF) 2. Latest Event Time (i) Latest Start Time (LS) (ii) Latest Finish Time (LF) Identify the Critical Path Calculate the Earliest Event Time (EET) 1. Earliest Finish Time (EF) 2. Earliest Start Time (ES) Calculate the Earliest Event Time (EET) Calculate the Earliest Event Time (EET) Calculate the Earliest Event Time (EET) Calculate the Latest Event Time (LET) 1. Latest Start Time (LS). 2. Latest Finish Time (LF) Calculate the Latest Event Time (LET) Calculate the Latest Event Time (LET) Calculate the Latest Event Time (LET) Determine the Critical Path, Critical Activities and Completion Time Earliest Start Earliest Latest Start Latest Finish Slack On Activity (ES) Finish (LS) (LF) (LS – Critical Path? (EF) ES) A 0 3 3 6 3 No B 0 5 0 5 0 Yes C 0 (ES) 3 3 6 3 No D 5 8 6 9 1 No E 5 7 5 7 0 Yes F 3 4 6 7 3 No G 3 6 6 9 3 Yes H 7 9 7 9 0 No Determine the Critical Path, Critical Activities and Completion Time Calculation of Float or Slack 1. Total Float (TF) = LF (current activity) – ES (current activity) – Duration of the activity 2. Free Float (FF) = ES (next activity) – EF (current activity) 3. Independent Float (IF) = ES (next activity) – LF (preceding activity) – Duration of the activity Example 8.7 A PERT network showing the EET and LET for a project is as follows: Example 8.7 a) Calculate the total float, free float and independent float for Activity G. b) If Activity G takes 7 months instead of 3, can the project be completed on time? c) How long can Activity G be delayed without delaying the project? Example 8.7 Solution Example 8.7 Example 8.7 Example 8.8 The table below shows the activities, duration and precedence relationships required to complete a project for Apex Development. Activity Predecessors Duration (week) A - 4 B - 5 C A 4 D B 6 E B,C 2 F D 2 G D,E 3 H F 4 Example 8.8 a) Construct the PERT network for this project. b) Calculate the earliest event time and the latest event time for the project. c) Determine the completion time of the project. d) Identify the critical activities. e) Which activities can be delayed without delaying the entire project? f) Calculate: (i) Total float for activity C (ii) Free float for activity F (iii) Independent float for activity E g) If activity E is delayed by 2 weeks, what would happen to the project completion time? Example 8.8 Solution a) Construct the PERT network for this project. b) Calculate the earliest event time and the latest event time for the project. Example 8.8 Example 8.8 Example 8.8 Thank You