COMMERCE 2OC3 Chapter Notes - Chapter 3: Work Breakdown Structure, Proj Construction, High Visibility
27 Apr 2018
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Operations Textbook
Chapter 3
Importance of Project Mgmt.
- Scheduling projects is quite difficult for opr. Managers
- Stakes are high in project mgmt.
- Cost overruns and unnecessary delays are due to poor scheduling and poor controls
- There are three phases the involves the mgmt. of projects
o Planning: This phase includes goal setting, defining the project, and team org.
o Scheduling: This phase relates ppl, money, and supplies to specific acts., and
relates acts., to each other
o Controlling: This phase the firm monitors resources, costs, quality, and budgets.
Also changes plans and shifts resources around
- Gantt charts, PERT and CPM are preferred techniques for a manager
Project Planning
- Projects: a series of related tasks directed toward a major output
- Project Org.: Org. made to ensure that programs (projects) receive, the proper mgmt..
and attention
o Needed when:
▪ Work tasks can be defined w/ a specific goal and deadline
▪ The job is unique or somewhat unfamiliar to the existing deadline
▪ The work contains complex interrelated tasks requiring specialized skills
▪ The project is temp. but critical to the org.
▪ The project cuts across org. lines
-
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- The Project Manager
o Coordinates acts. w/ other dept. and reports directly to top mgmt..
o Receive high visibility and resp. for:
▪ All necessary acts. Are finished in proper seq. and on-time
▪ The project comes in within budget
▪ The project meets its quality goals
▪ Ppl. assigned to the project receive the motivation, direction and info. To
do the job.
o Cons:
▪ Face multiple ethical decisions, such as,
• Offers of gift from contractors
• Pressure to alter status reports to mask the reality of delays
• False reports for charges pf time and expenses
• Pressures to compromise quality to meet bonuses or avoid
penalties related to schedules
- Work Breakdown Structure
o WBS: A hierarchical descp. Of a project into more and more detailed concepts;
project by dividing it into its major subcomponents (tasks), which are then
subdivided into more detailed components and finally into a set of acts. And
their related costs
o A plan is usually dvlpd. Before the project begins; objectives, broken down in to
dept.
o The WBS usually decreases in size from topbottom
▪ 1. Project; 2. Major TASKS in the proj.; 3. Subtasks in major tasks; 4. Acts.
To be completed
Project Scheduling
- Involves sequencing and allotting time to all project acts.
- Managers decide how long each act. Will take and compute the resources needed at
each stage of prof.
- A popular project scheduling method is Gantt charts
o Gantt Charts: Planning charts are used to schedule resources and allocate time;
Low-cost means of helping managers make sure that;
▪ Acts. Are planned
▪ Order of perf. Is documented
▪ Acts. Time est. are recorded
▪ Overall project time is dvlpd.
- PERT and CPM are two widely used ntwk. Techniques
o They have the ability to consider precedence rtlshps. And interdependency of
acts.
o PERT and CPM are preferred over Gantt charts for complex projects
- Project Scheduling serves several purposes
o It shows the rtlshp. Of each act. To others and to the whole project
o It identifies the precedence rtlshps. Among acts.
o It encourages the setting of realistic time and cost est. for each act.
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o It helps make better use of ppl, money, and material resources by identifying
critical bottlenecks in the project
Project Controlling
- Involves close monitoring of resources, costs, quality and budgets
- Control also means using feedback loop to revise the project plan and having the ability
to shift resources to where they are needed most
- Programs for firms provide
o Detailed cost breakdowns
o Labour reqm.
o Cost/ hour summaries
o Raw mat. And expenditure forecasts
o Variance reports
o Time analysis reports
o Work Status reports
- Stakes are high
o DUE to unnecessary delays and cost overruns, these delays can occur due to
poor planning, scheduling, and controls
- Proj. eoe ell-defied he the oplete etesie iitial plaig ad areful
definition of reqd. inputs, resources, processes and outputs
Project Mgmt. Techniques: PERT and CPM
- Program Eval. And Review Technique (PERT): A project mgmt. technique that employs
three-time est. for each activity
- Critical Path Method (CPM): A project mgmt.. technique that uses only one-time factor
per activity
- These two acts. Were dvlpd. To help managers, schedule, monitor and control lrg. And
complex projects
- The Framework of PERT and CPM
o Define the proj. and prepare the wbs
o Develop the rtlshp. Among the acts. Decide which acts. Must proceed and which
must follow others
o Draw the ntwk. Connecting all the acts.
o Assign time and/or cost est. to each act.
o Compute the longest time path thru the ntwk. This is called critical path
▪ Critical Path: The computed longest time path(s) thru a ntwk.
• If acts. In this step is not completed, this will delay the project
▪ This step is a major part of controlling a project
o Use the ntwk, to help plan, schedule, monitor and control the project
- Networks Diagrams and Approaches
o First step is to divide the entire proj. into significant acts. In accordance w/ the
WBS
o Two approaches to draw a project ntwk.
▪ Activity-on-node (AON): A ntwk. Diagram in which nodes designate acts.
▪ Activity-on-arrow (AOA): A ntwk. Diagram in which arrows designate acts.
▪ The diff. is that nodes in AON rep. activities
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Document Summary
Scheduling projects is quite difficult for opr. Cost overruns and unnecessary delays are due to poor scheduling and poor controls. Gantt charts, pert and cpm are preferred techniques for a manager. Projects: a series of related tasks directed toward a major output. The project manager: coordinates acts. w/ other dept. and reports directly to top mgmt. , receive high visibility and resp. for, all necessary acts. Are finished in proper seq. and on-time: the project comes in within budget, the project meets its quality goals, ppl. assigned to the project receive the motivation, direction and info. Work breakdown structure: wbs: a hierarchical descp. Of a project into more and more detailed concepts; project by dividing it into its major subcomponents (tasks), which are then subdivided into more detailed components and finally into a set of acts. And their related costs: a plan is usually dvlpd.
