1. Project Management Concept

1. 1. Project Management Concept Dr. Kittipong S.

2. Related terms(topics) • Pre-feasibility study • Feasibility study • Business Plan • Project analysis • Project Management

3. Project Defined A project is an endeavor to accomplish a specific objective through a unique set of interrelated tasks and the effective utilization of resources.

4. Project Management Drivers • Expansion of knowledge • Demand for new products • Worldwide markets • Competition • Belief “better living though technology” • Expanding size of projects • Crisis events

5. Three Project Objectives • Performance • Cost • Time

6. Project Management Process PROJECT INITIATION PROJECT IMPLEMENTATION PROJECT TERMINATION

7. PROJECT INITIATION • Project Selection • The Project Manager • Project Organization • Project Planning

8. PROJECT IMPLEMENTATION • Budgeting and Cost Estimation • Scheduling • Resource Allocation • Project Control

9. PROJECT TERMINATION • Project Evaluation • Project Termination

10. 2.Project Selection

11. Project Selection and Criteria of choice • Project selection is the process of evaluating individual projects or group of projects and then choosing to implement some set of them so that the objectives of the parent organization will be achieved

12. Nature of PS Models:Methodology • Start with detailed list of firm’s goals • Create list of project evaluation factors (PEF’s) • Weigh every element in PEF list • Compute an overall score for project based on weighted PEF’s • Select project that has the closest alignment with firm’s goals

13. Numeric PS Models:Profit / Profitability • Payback Period (PB) • Average Rate of Return • Discounted Cash Flow (NPV) • Internal Rate of Return • Profitability Index • Other Profitability Models

14. Project Screening Matrix

15. 3. Project manager and Project Team

16. Functional and Project Manager Compared Functional Manager: Project Manager:

17. Analytical approach : Breaking the components of a system into smaller and smaller elements Direct and technical supervisor Technology of process Functional Manager

18. System approach : A set of interrelated components that accept inputs and produce output Purposeful:attention to the system Inputs(arrive) and outputs(depart) Interrelationship(environment) Facilitator and generalist Science of project management Project Manager

19. 1. Strong leadership ability 2. Ability to develop people 3. Excellent communication skills 4. Good interpersonal skills 5. Ability to handle stress 6. Problem-solving skills 7. Time management skills The project manager is a key ingredient in the success of a project. Skills of the Project Manager

20. 4.Project Organization • As a part of functional organization • Pure project organization • Matrix organization

21. Pure Project Organization

22. The Matrix Organization

23. Choosing the Organizational form • Nature of the potential project • Characteristics of various organizational options • Advantages and disadvantages of each • Cultural preference of the parent organization

24. 5. Project Planning

25. Reasons for Project Planning • Establish a set of directions for project team to produce the deliverables of project • What must be done • When it must be done • What resources to use • Focus with organization’s goal • Support objectives of parent organization • Make allowance for risk • Put controls on the planned work

26. Project Plan Elements • Overview • Objectives • General approach • Work breakdown Structure • Linear Responsible Chart/Personnel • Contractual aspects • Schedules • Resources • Evaluation methods • Potential problems

27. Work Breakdown Structure (WBS) • A list of all the activities must be developed. • The WBS is a hierarchical tree of end items to be accomplished. • A work item is one small piece of the project. • A work package is the lowest-level item.

28. Linear Responsibility Chart(Matrix) • Displays in tabular format the individuals responsible for the work items. • “X” can be used to indicate who is responsible. • “P” indicates who has primary responsibility. • “S” indicates who has secondary responsibility.

29. Responsibility Matrix for a Market Research Project

30. 6. Budgeting and Cost Estimation

31. Developing a Project Budget • Three major elements • Forecast what will be needed • Labor and material • How much will it cost? • When will it be needed? • Thus, the budget reflects the project plan, time-phased, in dollars

32. Major Approaches to Budgeting • Top-Down Budgeting • Bottom-Up Budgeting • Work element costing • Category/Activity Budgeting vs. Program Budgeting

33. 7 Scheduling and Control

34. Scheduling Defined • The conversion of a project action plan into an operating timetable • Serves as the basis for monitoring and controlling the project

35. JAN FEB MAR 1 8 15 22 29 5 12 19 26 5 12 19 26 Gantt Charts

36. Activity Network

37. Program Evaluation and Review Technique (PERT) and Critical Path Method (CPM) • Understand how to plan, monitor, and control projects with the use of PERT. • Determine earliest start, earliest finish, latest start, latest finish, and slack times for each activity along with the total project completion time.

38. Example of PERT

39. 4 2 C A F H E 6 1 7 G B D 3 5 Drawing the PERT Network (Construct Collection Stack) (Install Control System) (Build Internal Components) (Build Burner) (Inspect and Test) (Modify Roof and Floor) (Install Pollution Device) (Pour Concrete and Install Frame)

40. PERT Network - with expected time t=2 4 2 C t=3 A F t=2 H t=4 E 6 1 7 t=2 t=3 G t=5 B D 3 5 t=4 A-C-F-H = 9 weeks The longest path will be Critical Path(ACEGH) -Project completion time A-C-E-G-H = 15 weeks B-D-G-H = 14 weeks

41. How to find the Critical Path • The critical path is the longest time • Earliest start time (ES) : the earliest time an activity can begin without violation of immediate predecessor requirement • Earliest finish time (EF) : the earliest time at which an activity can end • Latest start time (LS) : the latest time an activity can begin without delaying the entire project • Latest finish time (LF) : the latest time an activity can end without delaying the entire project

42. 2 4 2 4 4 7 10 13 0 2 0 2 13 15 13 15 4 8 4 8 8 13 8 13 0 3 1 4 3 7 4 8 PERT Network ES/EF, LS/LF t=2 4 2 C t=3 A F t=2 H t=4 E 6 1 7 t=2 B G t=3 t=5 D ES EF LS LF 3 5 t=4

43. PERT Network - Critical Path 4 2 C A F H E 6 1 7 G B Total time: 15 D 3 5 Critical path is “ ACEGH ”

44. 8. Resource Consideration and Allocation

45. Some Definitions • Resource consideration and allocation permits efficient use of physical assets • Within a project, or across multiple projects • Drives both the identification of resources, and timing of their application

46. Resource Loading • Resource loading: types and quantities of resources, spread by schedule across specific time periods

47. Resource Leveling • Resource leveling minimizes period-by-period variations in resource loading, by shifting tasks within their slack allowances

48. Types of Resources condition • There are generally two conditions: • “Normal” • “Crashed”

49. Normal and Crashing • Normal: within task duration • Crash: Expedite an activity, by applying additional resources • Specialized or additional equipment • More people (e.g., borrowed staff, temps) • More hours (e.g., overtime, weekends)

50. 9 Project Control and Termination