This document provides an overview of project management concepts including: - The purpose of project management is to ensure objectives are met on schedule and budget through communication, meetings, reviews, and monitoring. - Project management involves planning, organizing, controlling, and measuring a group of linked activities with a clear start and end point to achieve specific results. - Techniques like CPM, PERT, and Gantt charts are used to plan projects, identify critical paths, determine slack times, and monitor progress. Project crashing can potentially reduce durations but at increased cost. - The project life cycle typically involves phases like planning, implementation, testing, and closure with varying resource needs and uncertainty levels through the process.

1. Project Management
Course: MBA
Subject: Production & Operation
Management
Unit: 4.1

2. The Two End Points in a Project
Inspiration
Operation
A miracle occurs

3. Purpose of Project Management
• Ensure meeting the project objectives within the
allocated schedule & budget
– Communication
– Meetings
– Reviews
– Authorization
– Record Keeping
– Monitoring (testing)
– Interface Control
• Not for assigning blame (usually)

4. What is Project Management?
• Project : A group of milestones or
phases, activities or tasks that support an
effort to accomplish something
• Management : is the process of
Planning, Organizing, Controlling and
Measuring

5. Project
• A collection of linked activities, carried out in
an organised manner,with a clearly defined
START POINT and END POINT to achieve
some specific results desired to satisfy the
needs of the organisation at the current time

6. Project Management
• A dynamic process that utilises the
appropriate resources of the organisation in a
controlled and structured manner, to achieve
some clearly defined objectives identified as
needs.
• It is always conducted within a defined set of
constraints

7. What does Project Management
Entail?
• Planning:is the most critical and gets the
least amount of our time
Beginning with the End in mind-Stephen Covey
• Organizing: Orderly fashion
(Contingent/Prerequisites)
• Controlling: is critical if we are to use our
limited resources wisely
• Measuring: To determine if we accomplished
the goal or met the target?

8. Measuring…….
• Are we efficient?
• Are we productive?
• Are we doing a good job?
• What is the outcome?
• Is it what we wanted to be?
If you can’t plan it, You can’t do it
If you can’t measure it, you can’t manage it

9. Who uses Project Management?
 Nearly Everyone to some degree
People plan their Days, their Weeks, their
Vacations and their Budgets and keep a simple
project management form known as ‘’To Do’’
list
 Any Process or Means used to track tasks or
efforts towards accomplishing a goal could be
considered Project Management

10. Why is Project Management used?
• It is necessary to Track or Measure the
progress we have achieved towards a Goal we
wish to accomplish
• We use Project Management to Aid us in
Maximizing and Optimizing our resources to
accomplish our goals

11. How much time does Project
Management take?
• Not much. Probably more time is wasted as a
consequence of lack of Project Management
tool than is spent to Plan adequately,
Organize, Control effectively and Measure
appropriately
• How long: As long as there are things to do

12. Why is Project Management
Important?
• Enables us to map out a course of action or
work plan
• Helps us to think systematically and
thoroughly
• Unique Task
• Specific Objective
• Variety of Resources
• Time bound

13. Advantages
• In built Monitoring/ Sequencing
• Easy and Early identification of Bottlenecks
• Activity based costing
• Identification and Addition of missing and new
activities
• Preempting unnecessary activity/expenditure
• Timely Completion
• Assigning tasks
• Reporting

14. Road to Better Project Management
• Find a Project plan that fits your style of project
management needs
• It may be as simple as creating templates, forms and
spreadsheets to track tasks
• Formation of a Project Management committee
• Listing out all the tasks and sub-tasks to accomplish a
goal
• Jot down the time period and person responsible
against each task/sub-task

15. Implementation
• Regular Monitoring
• Resource Support
• Critical issues discussed and solution
• Meeting with the team on completion of
each major milestone
• Track the progress against the plan
• System to add/delete tasks in the PMT

16. Consequences of
not using PMT
DELAY
COST
WASTE OF RESOURCES
QUALITY
DISSATISFACTION
REPUTATION

17. Project Phases and the Project Life
Cycle
• A project life cycle is a collection of project
phases that defines:
– What work will be performed in each phase.
– What deliverables will be produced and when.
– Who is involved in each phase.
– How management will control and approve work
produced in each phase.
• A deliverable is a product or service produced
or provided as part of a project.

18. More on Project Phases
• In the early phases of a project life cycle:
– Resource needs are usually lowest.
– The level of uncertainty (risk) is highest.
– Project stakeholders have the greatest opportunity to
influence the project.
• In the middle phases of a project life cycle:
– The certainty of completing a project increases.
– More resources are needed.
• In the final phase of a project life cycle:
– The focus is on ensuring that project requirements were
met.
– The sponsor approves completion of the project.

19. Phases of the Traditional Project Life
Cycle

20. History
• Developed in 1950’s
• CPM by DuPont for chemical plants
• PERT by U.S. Navy for Polaris missile
PERT was developed by the US Navy for the planning and control of
the Polaris missile program and the emphasis was on completing the
program in the shortest possible time. In addition PERT had the
ability to cope with uncertain activity completion times (e.g. for a
particular activity the most likely completion time is 4 weeks but it
could be anywhere between 3 weeks and 8 weeks).
CPM was developed by Du Pont and the emphasis was on the
trade-off between the cost of the project and its overall
completion time (e.g. for certain activities it may be possible
to decrease their completion times by spending more money -
how does this affect the overall completion time of the
project?)

21. CPM - Critical Path Method
• Definition: In CPM activities are shown as a network
of precedence relationships using activity-on-node
network construction
– Single estimate of activity time
– Deterministic activity times
USED IN : Production management - for the jobs of
repetitive in nature where the activity time
estimates can be predicted with considerable
certainty due to the existence of past experience.

22. PERT -
Project Evaluation & Review Techniques
• Definition: In PERT activities are shown as a network of
precedence relationships using activity-on-arrow network
construction
– Multiple time estimates
– Probabilistic activity times
USED IN : Project management - for non-repetitive jobs
(research and development work), where the time and
cost estimates tend to be quite uncertain. This technique
uses probabilistic time estimates.

23. Gantt chart
Advantages
- Gantt charts are quite commonly used.
They provide an easy graphical
representation of when activities (might)
take place.
Limitations
- Do not clearly indicate details regarding
the progress of activities
- Do not give a clear indication of
interrelation ship between the separate
activities
Originated by H.L.Gantt in
1918

24. CPM/PERT
These deficiencies can be eliminated to a large extent by
showing the interdependence of various activities by means
of connecting arrows called network technique.
• Overtime CPM and PERT became one technique
• ADVANTAGES:
– Precedence relationships
– large projects
– more efficient

25. The Project Network
• Use of nodes and arrows
Arrows  An arrow leads from tail to head directionally
– Indicate ACTIVITY, a time consuming effort that is required to perform
a part of the work.
Nodes  A node is represented by a circle
- Indicate EVENT, a point in time where one or more activities start
and/or finish.

26. Activity on Node & Activity on Arrow
Activity on Node
- A completion of an
activity is represented by
a node
Activity on Arrow
- An arrow represents a
task, while a node is the
completion of a task
- Arrows represent order of
events

27. Activity Slack
Each event has two important times associated with it :
- Earliest time , Te , which is a calendar time when a event can
occur when all the predecessor events completed at the earliest
possible times
- Latest time , TL , which is the latest time the event can occur with
out delaying the subsequent events and completion of project.
• Difference between the latest time and the earliest time of an
event is the slack time for that event
Positive slack : Slack is the amount of time an event can be delayed
without delaying the project completion

28. Critical Path
• Is that the sequence of activities and events
where there is no “slack” i.e.. Zero slack
• Longest path through a network
• minimum project completion time

29. Benefits of CPM/PERT
• Useful at many stages of project management
• Mathematically simple
• Give critical path and slack time
• Provide project documentation
• Useful in monitoring costs

30. Questions Answered by CPM & PERT
• Completion date?
• On Schedule?
• Within Budget?
• Critical Activities?
• How can the project be finished early at the
least cost?

31. Limitations to CPM/PERT
• Clearly defined, independent and stable
activities
• Specified precedence relationships
• Over emphasis on critical paths

32. Project Crashing
Question: Can we cut short its project
completion time?
If so, how!

33. Project Crashing
Solution!
Yes, the project duration can be reduced by
assigning more resources to project activities.
But, doing this would somehow increase our
project cost!
How do we strike a balance?
■ Project crashing is a method for shortening
project duration by reducing one or more
critical activities to a time less than normal
activity time.

34. Trade-off concept
Here, we adopt the “Trade-off” concept
• We attempt to “crash” some “critical” events
by allocating more resources to them, so that
the time of one or more critical activities is
reduced to a time that is less than the normal
activity time.
• How to do that:
• Question: What criteria should it be based
on when deciding to crashing critical times?

35. Example – crashing
The critical path is 1-2-3, the completion time
=11
How? Path: 1-2-3 = 5+6=11 weeks
Path: 1-3 = 5 weeks
Now, how many days can we “crash” it?
1
3
2
5 (1)
6(3)
5(0)
Normal weeks
Max weeks can be crashed

36. Example – crashing
1
3
2
5 (1)
6(3)
5(0)
The maximum time that can be crashed for:
Path 1-2-3 = 1 + 3 = 4
Path 1-3 = 0
Should we use up all these 4 weeks?

37. Example – crashing
1
3
2
5 (1)
6(3)
5(0)
If we used all 4 days, then path 1-2-3 has
(5-1) + (6-3) = 7 completion weeks
Now, we need to check if the completion time for path 1-3 has lesser than 7
weeks (why?)
Now, path 1-3 has (5-0) = 5 weeks
Since path 1-3 still shorter than 7 weeks, we used up all 4 crashed weeks
Question: What if path 1-3 has, say 8 weeks completion time?
4(0) 3(0)

38. Example – crashing
1
3
2
5 (1)
6(3)
8(0)
Such as
Now, we cannot use all 4 days (Why?)
Because path 1-2-3 will not be critical path anymore as
path 1-3 would now has longest hour to finish
Rule: When a path is a critical path, it will not stay as a critical path
So, we can only reduce the path 1-2-3 completion time to the same time
as path 1-3. (HOW?)

39. Example – crashing
1
3
2
5 (1)
6(3)
8(0)
Solution:
We can only reduce total time for path 1-2-3 = path 1-3,
that is 8 weeks
If the cost for path 1-2 and path 2-3 is the same then
We can random pick them to crash so that its completion
Time is 8 weeks

40. Example – crashing
1
3
2
5 (1)
6(3)
8(0)
Solution:
1
2
3
5 (1) 6(3)
8(0)
OR
4(0) 4(1)
3(0)
Now, paths 1-2-3 and 1-3 are both critical paths

41. References
• homes.ieu.edu.tr/stunali/courses/ch08_crashi
ng
• ww.csus.edu/indiv/b/blakeh/mgmt/