Project Management

1. Project Management Dr. Ron Lembke Operations Management

2. What’s a Project? • Changing something from the way it is to the desired state • Never done one exactly like this • Many related activities • Focus on the outcome • Regular teamwork focuses on the work process

3. Examples of Projects • Building construction • New product introduction • Software implementation • Training seminar • Research project

4. Why are projects hard? • Resources- • People, materials • Planning • What needs to be done? • How long will it take? • What sequence? • Keeping track of who is supposedly doing what, and getting them to do it

5. IT Projects • Half finish late and over budget • Nearly a third are abandoned before completion • The Standish Group, in Infoworld • Get & keep users involved & informed • Watch for scope creep / feature creep

6. Pinion Pine Power Plant • DOE Clean Coal • Air-blown Integrated Gasification Combined Cycle • Kellogg/Rust/Westinghouse gasifier • GE Frame 6FA combustion turbine • $335.9m, half DOE, half SPP

7. Coal Gasification • Coal Gasification (new) • Coal into Low Heat Value (LHV) gas 130 btus/standard foot • Crushed coal and limestone absorbs sulfur • Hot gas desulfirized • Particulate removal • Gas Fed into turbine • Tested fine on nat gas

8. Technology Development • Ash created in gasification, collected • Hot-gas cleanup (new technology) • SO2 in collected in calcium sulfate • Hot-gas filter, then to combustion turbine • Fines combustor burns particles bottom of filter • Main problem was filter-fines removal • Never operated more than 24 hrs. • Tried 24 times to start it. Eventually mothballed

9. Project Scheduling • Establishing objectives • Determining available resources • Sequencing activities • Identifying precedence relationships • Determining activity times & costs • Estimating material & worker requirements • Determining critical activities

10. Work Breakdown Structure –Fig 17.2 • Hierarchy of what needs to be done, in what order • For me, the hardest part • I’ve never done this before. How do I know what I’ll do when and how long it’ll take? • I think in phases • The farther ahead in time, the less detailed • Figure out the tricky issues, the rest is details • A lot will happen between now and then • It works not badly with no deadline

11. Mudroom

12. W D Mudroom Remodel Before: D • Big-picture sequence easy: • Demolition • Framing • Plumbing • Electrical • Drywall, tape & texture • Slate flooring • Cabinets, lights, paint • Hard: can a sink fit? W After:

13. Project Scheduling Techniques • Gantt chart • Critical Path Method (CPM) • Program Evaluation & Review Technique (PERT)

14. Gantt Chart

17. PERT & CPM • Network techniques • Developed in 1950’s • CPM by DuPont for chemical plants • PERT by U.S. Navy for Polaris missile • Consider precedence relationships & interdependencies • Each uses a different estimate of activity times

18. Questions Answered by PERT & CPM • Completion date? • On schedule? Within budget? • Probability of completing by ...? • Critical activities? • Enough resources available? • How can the project be finished early at the least cost?

19. PERT & CPM Steps • Identify activities • Determine sequence • Create network • Determine activity times • Find critical path • Earliest & latest start times • Earliest & latest finish times • Slack

20. 1 2 3 Activity on Node (AoN) Project: Obtain a college degree (B.S.) Receive diploma Attend class, study etc. Enroll 1 month 4? Years 1 day

21. 1 2 3 4 Activity on Arc (AoA) Project: Obtain a college degree (B.S.) Attend class, study, etc. Receive diploma Enroll 1 month 4,5 ? Years 1 day

22. 1 2 3 4 AoA Nodes have meaning Project: Obtain a college degree (B.S.) GraduatingSenior Applicant Student Alum

23. Network Example You’re a project manager for Bechtel. Construct the network. Activity Predecessors A --B A C AD B E BF C G DH E, F

24. A C E F B D G H Z Network Example - AON

25. 7 2 9 5 1 3 6 8 Network Example - AOA G D B E A H C F 4

26. 2 2 3 1 5 3 1 4 4 AOA Diagrams A precedes B and C, B and C precede D B A D C B A C D Add a phantom arc for clarity.

27. Critical Path Analysis • Provides activity information • Earliest (ES) & latest (LS) start • Earliest (EF) & latest (LF) finish • Slack (S): Allowable delay • Identifies critical path • Longest path in network • Shortest time project can be completed • Any delay on activities delays project • Activities have 0 slack

28. Critical Path Analysis Example

29. Network Solution B D E A G 2 6 3 1 1 C F 3 4

30. Earliest Start & Finish Steps • Begin at starting event & work forward • ES = 0 for starting activities • ES is earliest start • EF = ES + Activity time • EF is earliest finish • ES = Maximum EF of all predecessors for non-starting activities

31. B D E A G 2 6 3 1 1 C F 3 4 Activity A Earliest Start Solution For starting activities, ES = 0.

32. B D E A G 2 6 3 1 1 C F 3 4 Earliest Start Solution

33. Latest Start & Finish Steps • Begin at ending event & work backward • LF = Maximum EF for ending activities • LF is latest finish; EF is earliest finish • LS = LF - Activity time • LS is latest start • LF = Minimum LS of all successors for non-ending activities

34. B D E A G 2 6 3 1 1 C F 3 4 Earliest Start Solution

35. B D E A G 2 6 3 1 1 C F 3 4 Latest Finish Solution

36. Compute Slack

37. B D E A G 2 6 3 1 1 C F 3 4 Critical Path

38. New notation • Compute ES, EF for each activity, Left to Right • Compute, LF, LS, Right to Left ES EF C 7 LS LF

39. Example #2 21 28 28 35 F 7 C 7 0 21 3537 A 21 G 2 28 33 21 25 2527 B 4 D 2 E 5

40. Example #2 21 28 28 35 F 7 C 7 0 21 3537 A 21 G 2 28 33 21 25 2527 B 4 D 2 E 5 F cannot start until C and D are done. G cannot start until both E and F are done.

41. Example #2 21 28 28 35 F 7 C 7 21 28 2835 0 21 3537 A 21 G 2 0 21 3537 28 33 21 25 2527 B 4 D 2 E 5 2226 2628 3035 E just has to be done in time for G to start at 35, so it has slack. D has to be done in time for F to go at 28, so it has no slack.

42. Example #2 21 28 28 35 F 7 C 7 21 28 2835 0 21 3537 A 21 G 2 0 21 3537 28 33 21 25 2527 B 4 D 2 E 5 2226 2628 3035 E just has to be done in time for G to start at 35, so it has slack. D has to be done in time for F to go at 28, so it has no slack.

43. Gantt Chart - ES A C B D E F G 0 5 10 15 20 25 30 35 40

44. Solved Problem 1 B4 E6 G7 C3 A 1 I4 F2 D7 H9

45. Solved Problem 1 1 5 511 B4 E6 1118 1 5 511 G7 1118 1 4 0 1 1822 C3 A 1 I4 6 9 0 1 810 1822 F2 1 8 911 817 D7 H9 2 9 918

46. Can We Go Faster?

48. Time-Cost Models 1. Identify the critical path 2. Find cost per day to expedite each node on critical path. 3. For cheapest node to expedite, reduce it as much as possible, or until critical path changes. 4. Repeat 1-3 until no feasible savings exist.

49. Time-Cost Example D 8 A 10 B 10 C 10 • ABC is critical path=30 Crash cost Crash per week wks avail A 500 2 B 800 3 C 5,000 2 D 1,100 2 Cheapest way to gain 1 Week is to cut A

50. Time-Cost Example D 8 A 9 B 10 C 10 • ABC is critical path=29 Crash cost Crash per week wks avail A 500 1 B 800 3 C 5,000 2 D 1,100 2 Wks Incremental Total Gained Crash $ Crash $ 1 500 500 Cheapest way to gain 1 wk Still is to cut A