Bài giảng Operations Management - Chapter 3: Project Management

Operations ManagementProject ManagementChapter 31OutlineGLOBAL COMPANY PROFILE: BECHTEL GROUPTHE IMPORTANCE OF PROJECT MANAGEMENTPROJECT PLANNINGThe Project ManagerWork Breakdown StructurePROJECT SCHEDULINGPROJECT CONTROLLING2Outline - ContinuedPROJECT MANAGEMENT TECHNIQUES: PERT AND CPMThe Framework of PERT and CPMNetwork Diagrams and ApproachesActivity on Node ExampleDetermining the Project ScheduleForward PassBackward PassCalculating Slack Time and Identifying the Critical Path(s)3Outline - ContinuedVariability in Activity TimesThree Time Estimates in PERTProbability of Project CompletionCost-Time Tradeoffs and Project CrashingA Critique of PERT and CPM4Learning ObjectivesWhen you complete this chapter, you should be able to :Identify or Define: Work breakdown structureCritical pathAOA and AON NetworksForward and Backward PassesVariability in Activity Times5Learning Objectives - ContinuedWhen you complete this chapter, you should be able to :Describe or Explain:The role of the project managerProgram evaluation and review technique (PERT)Critical path method (CPM)Crashing a projectThe Use of MS Project6BechtelAsked by Kuwait to begin rebuilding after Desert Storm650 wells ablaze, others uncappedNo water, electricity, food or facilitiesLand mines! Bombs! Grenades!Many fires inaccessible because of oil-covered roads7BechtelProject required:Storage, docking, and warehousing facilities at Dubai125,000 tons of equipment and supplies150 kilometers of pipeline capable of delivering 20,000,000 gallons of water per day to the fire sitemore than 200 lagoons with 1,000,000 gals of seawater8BechtelOther ProjectsBuilding 26 massive distribution centers in just two years for the internet company Webvan GroupConstructing 30 high-security data centers worldwide for Equinix, Inc.Building and running a rail line between London and the Channel Tunnel ($4.6 billion)Developing an oil pipeline from the Caspian Sea region to Russia ($850 million)Expanding the Dubai Airport in the UAE ($600 million), and the Miami Airport in Florida ($2 billion)9BechtelOther Projects - ContinuedBuilding liquid natural gas plants in Yemen $2 billion) and in Trinidad, West Indies ($1 billion)Building a new subway for Athens, Greece ($2.6 billion)Constructing a natural gas pipeline in Thailand ($700 million)Building a highway to link the north and south of Croatia ($303 million)10Strategic Importance of Project ManagementBechtel Kuwait Project:8,000 workers1,000 construction professionals100 medical personnel2 helicopter evacuation teams6 full-service dining halls27,000 meals per day40 bed field hospital11Strategic Importance of Project Management - ContinuedMicrosoft Windows XP Project:hundreds of programmersmillions of lines of codemillions of dollars costFord Redesign of Mustang Project:450 member project teamCost $700-million25% faster and 30% cheaper than comparable project at Ford12Single unitMany related activitiesDifficult production planning and inventory controlGeneral purpose equipmentHigh labor skillsProject Characteristics13Building construction© 1995 Corel Corp.An Example14Research project © 1995 Corel Corp.An Example15Management of Large ProjectsPlanning - goal setting, project definition, team organizationScheduling - relating people, money, and supplies to specific activities and activities to one and otherControlling - monitoring resources, costs, quality, and budgets; revising plans and shifting resources to meet time and cost demands16 PlanningObjectivesResourcesWork break-down scheduleOrganizationSchedulingProject activitiesStart & end timesNetworkControllingMonitor, compare, revise, actionProject Management Activities17Project OrganizationWorks Best WhenWork can be defined with a specific goal and deadlineThe job is unique or somewhat unfamiliar to the existing organizationThe work contains complex interrelated tasks requiring specialized skillsThe project is temporary but critical to the organization18Project Planning, Scheduling, and ControllingProject Planning1. Setting goals2. Defining the project3. Tying needs into timed project activities4. Organizing the teamProject Scheduling1. Tying resources to specific activities2. Relating activities to each other3. Updating and revising on a regular basisTime/cost estimatesBudgetsEngineering diagramsCash flow chartsMaterial availability detailsCPM/PERTGantt chartsMilestone chartsCash flow schedulesProject Controlling1. Monitoring resources, costs, quality, and budgets2. Revising and changing plans3. Shifting resources to meet demandsReports budgets delayed activities slack activitiesBefore ProjectDuring Project19Project Planning, Scheduling, and Controlling20Establishing objectivesDefining projectCreating work breakdown structure Determining resourcesForming organization© 1995 Corel Corp.Project Planning21Often temporary structureUses specialists from entire companyHeaded by project managerCoordinates activities Monitors schedule & costsPermanent structure called ‘matrix organization’© 1995 Corel Corp.Project OrganizationAcct.Eng.Eng.Mkt.Mgr.22A Sample Project OrganizationSalesPresidentFinanceHumanResourcesEngineeringQualityControlProductionTechnicianTestEngineerPropulsionEngineerPhysiologistProjectManagerPsychologistStructuralEngineerInspectionTechnicianTechnicianProject 1Project 2ProjectManager23A Sample Project OrganizationSalesFinanceHumanResourcesEngineeringQualityControlProductionTestEngineerPropulsionEngineerTechnicianProject 1Project 2ProjectManagerTechnicianProjectManagerStructuralEngineerInspectionTechnicianPresident24MktOperEngFinProject 1Project 2Project 3Project 4Matrix Organization25The Role of the Project ManagerProject Planand ScheduleRevisions andUpdatesProjectManagerProjectTeamTopManagementResourcesPerformanceReportsInformationregarding times,costs, problems,delaysFeedback Loop26Work Breakdown Structure1. Project2. Major tasks in the project3. Subtasks in the major tasks4. Activities (or work packages) to be completed27Identifying precedence relationships Sequencing activitiesDetermining activity times & costsEstimating material & worker requirementsDetermining critical activities© 1995 Corel Corp.JFMAMJJMonthActivityDesignBuildTestPERTProject Scheduling28Purposes of Project SchedulingShows the relationship of each activity to others and to the whole project.Identifies the precedence relationships among activities.Encourages the setting of realistic time and cost estimates for each activity.Helps make better use of people, money, and material resources by identifying critical bottlenecks in the project.29Gantt chartCritical Path Method (CPM)Program Evaluation & Review Technique (PERT)© 1984-1994 T/Maker Co.Project Management Techniques30JFMAMJJTime PeriodActivityDesignBuildTestGantt Chart31Service Activities for A Delta Jet During a 60 Minute Layover32Project Control ReportsDetailed cost breakdowns for each taskTotal program labor curvesCost distribution tablesFunctional cost and hour summariesRaw materials and expenditure forecastsVariance reportsTime analysis reportsWork status reports33Network techniquesDeveloped in 1950’sCPM by DuPont for chemical plants (1957)PERT by Booz, Allen & Hamilton with the U.S. Navy, for Polaris missile (1958)Consider precedence relationships and interdependenciesEach uses a different estimate of activity timesPERT and CPM34Is the project on schedule, ahead of schedule, or behind schedule?Is the project over or under cost budget?Are there enough resources available to finish the project on time?If the project must be finished in less than the scheduled amount of time, what is the way to accomplish this at least cost?Questions Which May Be Addressed by PERT & CPM35The Six Steps Common to PERT & CPMDefine the project and prepare the work breakdown structure,Develop relationships among the activities. (Decide which activities must precede and which must follow others.)Draw the network connecting all of the activitiesAssign time and/or cost estimates to each activityCompute the longest time path through the network. This is called the critical pathUse the network to help plan, schedule, monitor, and control the project36A Comparison of AON and AOA Network Conventions37Milwaukee General Hospital’s Activities and Predecessors ActivityDescriptionImmediate PredecessorsABuild internal components-BModify roof and floor-CConstruct collection stackADPour concrete and install frameA, BEBuild high-temperature burnerCFInstall pollution control systemCGInstall air pollution deviceD, EHInspect and testF, G38AON Network for Milwaukee General HospitalStartABCDFFGHArrows show precedence relationships391324567HInspect/TestGInstall pollution control deviceDPour concrete/ Install frameBModify roof/floorCConstruct stackFInstall controlsEBuild burnerAOA Network (With Dummy Activities) for Milwaukee GeneralABuild internal componentsDummy Activity40Provides activity informationEarliest (ES) & latest (LS) startEarliest (EF) & latest (LF) finishSlack (S): Allowable delayIdentifies critical pathLongest path in networkShortest time project can be completedAny delay on critical path activities delays projectCritical path activities have 0 slackCritical Path Analysis41Begin at starting event and work forwardES = 0 for starting activitiesES is earliest startEF = ES + Activity timeEF is earliest finishES = Maximum EF of all predecessors for non-starting activitiesEarliest Start and Finish Steps42Begin at ending event and work backwardLF = Maximum EF for ending activitiesLF is latest finish; EF is earliest finishLS = LF - Activity timeLS is latest startLF = Minimum LS of all successors for non-ending activitiesLatest Start and Finish Steps43Latest Start and Finish StepsLatest FinishESLSEFLFEarliest FinishLatest StartEarliest StartActivity NameActivity Duration44Critical Path forMilwaukee General HospitalStartABCDFFGHArrows show precedence relationships45AON Network for Milwaukee General HospitalIncludes Critical Path Slack=0StartABCDFFGHH131321515HG8851313HF4103713HC22244HE44488HD34478HB01334HA00222H00000Slack=0Slack=0Slack=0Slack=0Slack=6Slack=1Slack=1Start46Gantt ChartEarliest Start and FinishMilwaukee General HospitalA Build internal componentsB Modify roof and floorC Construct collection stackD Pour concrete and install frameE Build high-temperature burnerF Install pollution control systemG Install air pollution deviceH Inspect and test1 2 3 4 5 6 7 8 9 10 1112 13 1415 1647Gantt ChartLatest Start and FinishMilwaukee General HospitalA Build internal componentsB Modify roof and floorC Construct collection stackD Pour concrete and install frameE Build high-temperature burnerF Install pollution control systemG Install air pollution deviceH Inspect and test1 2 3 4 5 6 7 8 9 10 1112 13 1415 16481-2 Fdn & frame1-3 Buy shrubs2-3 Roof2-4 Interior work3-4 Landscape456789101112321ActivityBuild House ProjectGantt Chart Latest Start and Finish493 time estimatesOptimistic times (a)Most-likely time (m)Pessimistic time (b)Follow beta distributionExpected time: t = (a + 4m + b)/6Variance of times: v = (b - a)2/6PERT Activity Times50Expected project time (T)Sum of critical path activity times, t Project variance (V)Sum of critical path activity variances, vUsed to obtain probability of project completion!Project Times51© 1995 Corel Corp.PERT Probability ExampleYou’re a project planner for General Dynamics. A submarine project has an expected completion time of 40 weeks, with a standard deviation of 5 weeks. What is the probability of finishing the sub in 50 weeks or less?52T = 40s = 550XNormal DistributionZXT=-=-=s5040520.mz = 0sZ = 1Z2.0Standardized Normal DistributionConverting to Standardized Variable53mz = 0sZ = 1Z2.0Z.00.010.0.50000.50399::::2.0.97725.97784.978312.1.98214.98257.98300Standardized Normal Probability Table (Portion)Probabilities in bodyObtaining the Probability.02.50798.9772554Variability of Completion Time for Noncritical PathsVariability of times for activities on noncritical paths must be considered when finding the probability of finishing in a specified time.Variation in noncritical activity may cause change in critical path.55Factors to Consider when CrashingThe amount by which an activity is crashed is, in fact, permissible.Taken together, the shortened activity durations will enable one to finish the project by the due date.The total cost of crashing is as small as possible.56Steps in Project CrashingCompute the crash cost per time period. For crash costs assumed linear over time:Using current activity times, find the critical pathIf there is only one critical path, then select the activity on this critical path that (a) can still be crashed, and (b) has the smallest crash cost per period. Note that a single activity may be common to more than one critical pathUpdate all activity times.57Crash and Normal Times and Costs for Activity B58Cost-Time Curves Used in Crashing Analysis59Advantages of PERT/CPMEspecially useful when scheduling and controlling large projects.Straightforward concept and not mathematically complex.Graphical networks aid perception of relationships among project activities.Critical path & slack time analyses help pinpoint activities that need to be closely watched.Project documentation and graphics point out who is responsible for various activities.Applicable to a wide variety of projects.Useful in monitoring schedules and costs.60Assumes clearly defined, independent, & stable activitiesSpecified precedence relationshipsActivity times (PERT) follow beta distributionSubjective time estimatesOver-emphasis on critical pathLimitations of PERT/CPM61