Pinto jk 2013 project management achieving competitive advantage

Project Initiation, Planning And Execution

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Week 3 Review

• Scheduling Terminology

• Activity Network pathways

• Duration Estimation

• Critical Path

• Apply lag relationships to project activities

• Construct and comprehend Time & Action

(Gantt) charts

• Recognise alternative means to accelerate

projects, including their benefits and drawbacks

• Understand the trade-offs required in the decision

to crash project activities

Week 4 Lecture Objectives

Lags in Precedence Relationships

Lag (Definition) – “the logical relationship between the start and finish of one activity and the start and finish of another” They commonly occur under four logical relationships:-

1. Finish to Start

2. Finish to Finish

3. Start to Start

4. Start to Finish

Lags in Precedence Relationships

Network Incorporating Finish to Start Lag of 4 Days

• Finish to Start relationship – most common type of logical sequencing

• See figure above – 3 tasks linked in a serial path

• Activity C cannot begin until the project receives a delivery from an

external supplier that is scheduled to occur four days after the

completion of activity B.

• The early start (ES) date for activity C has now been delayed for the 4

days of the lag.

• Finish to Start lag delay is usually shown on the line joining the nodes; it

should be added in forward pass calculations and subtracted in

backward pass calculations.

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p353

Lags in Precedence Relationships

Network Incorporating Finish to Finish Relationship

• Finish to Finish relationships – two linked activities must share a

similar completion point (R to T).

• Figure shows an example of a Finish to Finish lag, in which the

preceding activities R, S, and T are completed to enable activity U

to commence immediately afterward.

• Lag of 3 days between activities R and T enables the tasks to

complete at the same point.

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p354

Lags in Precedence Relationships

Network Incorporating Start to Start Relationship

• Start to Start relationship – two or more activities can start

simultaneously or a lag takes place between the start of one

activity after an earlier activity has commenced.

• The logic must be maintained by both the forward and backward

pass through the network.

• Becoming increasingly used as a means to accelerate projects

(fast tracking). Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p354

Lags in Precedence Relationships

Network Incorporating Start to Finish Relationship

• Start to Finish – perhaps the least common type of lag relationship occurs

when a successor’s finish is dependent upon a predecessor’s start.

• As with the other types of predecessor/successor relationships, we must

examine network logic to ascertain the most appropriate manner for linking

networked activities with each other.

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p355

Workshop Activity

Divide into groups of 3 or 4 students. Can you

think of situations in a project where lag

relationships between activities are used for the

following:

1. Finish to start

2. Finish to finish

Discuss your examples with the class.

Time & Action Charts • Time & Action (Gantt) Charts have been used in Project Management for many

years.

• They establish a time-phased network which link project activities to a project

schedule baseline.

• They are also used as a project tracking tool to monitor planned vs. actual

performance.

Gantt Charts

Some benefits of Gantt charts include the following:

• The visual format of the Gantt chart is easy to read and

understand. The timelines give managers and team members

a visual overview of when activities will occur, and whether

they are dependent upon completion of other tasks.

• Organises activities by listing tasks and subtasks in logical

groupings

• Shows who is responsible for each task and dates for start

and completion

• Allows for updating and project control

• Identifies resource needs and assigns them to tasks

• Helps to establish reasonable time frames

Gantt Charts

Completed Gantt chart for Project Delta Source: MS Project 2013, Microsoft Corp.

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p357

Gantt Charts Critical Path

Completed Gantt chart for Project Delta with Critical Path Highlighted Source: MS Project 2013, Microsoft Corp.

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p357

Gantt Charts Adding Resources

Gantt chart with Specified Resources Source: MS Project 2013, Microsoft Corp.

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p358

Workshop Activity

Form small groups (3 or 4) and identify any

weaknesses in using Gantt charts. Share your

findings with the rest of the class.

Crashing Projects

Crashing (definition) – “expediting the project by accelerating development in

order to reach an earlier completion date”

Why?

1.The initial schedule may be too optimistic / unrealistic. We may schedule the

project with a series of activity durations so condensed they make the crashing

process inevitable.

2.Changing circumstances, so that project is in demand earlier than

anticipated.

3.Slippage, so that the project is behind schedule. You may determine that the

only way to regain the original milestones is to crash all remaining activities.

4.The contractual situation provides even more incentive to avoid schedule

slippage. The organisation may realise that it will be responsible for paying more

in late delivery penalties than the cost of crashing the activities.

Crashing Projects

1. Improve the productivity of existing project

resources – do things more efficiently.

2. Change the working method employed for the activity

– change the technology and types of resources

employed.

1. Fast-track the project – look for ways to rearrange the

project schedule in order to move more of the critical

path activities from sequential to parallel (concurrent)

relationships.

Crashing Projects

Crashing Projects

• When looking at crash options for project

activities, the objective is to find the point at

which time and cost trade-offs are optimised.

• Various combinations of time/cost trade-offs for

a project’s crash options can be calculated by

determining the slope for each activity using

the following formula:

Slope = crash cost - normal cost

normal time - crash time

Crashing Projects

The cost slope can be represented diagrammatically

as follows:-

Crashing Projects

The time/cost trade-offs for crashing activities can

be represented diagrammatically as follows:-

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p364

Workshop Activity

In small groups of 3 or 4, calculate the cost of the

following crashing project:-

Assumptions: The normal activity duration for

activity X is 6 weeks and the budgeted cost is

$32,000. The crash time for this activity is 4

weeks and the expected cost is $52,000.

Is this a reasonable price?

Crashing Projects Budget Effects

• Crashing is the decision to shorten activity duration

times through adding resources and paying

additional direct costs.

• There is a clear relationship between the decision

to crash project activities and the effect of the

crashing on the budget.

• The cost of crashing is always to be weighed

against the time saved in expediting the activity’s

schedule.

Crashing Projects Budget Effects

Let’s look at the crashing table above. If we assume that activities A, C, D, and

H are on the critical path, the first decision relates to which of the critical

activities we should crash.

Crashing Projects Budget Effects

• From the table on previous slide, crashing activity C (the least expensive

to crash) saves 3 days at a cost of $1,500 in extra expenses.

• Other candidates for crashing (A, D, and H) – also evaluated individually

in terms of schedule time gained versus cost to the project budget

(assume all other paths are ≤ 48 days). Crashing Activity A saves the

project 3 days at an additional cost of $2,000, raising the total cost of A to

$4,000. Crashing Activities D and H represents a time savings of 5 and 3

days respectively at additional costs of $3,000 for each.

Crashing Projects Budget Effects

Crashing Projects Project Costs

Project costs over the life cycle

Source: Pinto, JK 2016, Project Management, Achieving Competitive Advantage, 4th Edition, Pearson Education Inc., p368

Workshop Activity

The recently built new Royal Adelaide Hospital has

been the culmination of one of the most significant

building projects in South Australia.

Form into groups of 3 or 4, and using your

smartphone or tablet, search for evidence of lags in

the project. How have these been managed? What

were the implications?

Discuss your findings with the class.

• Activity network development is the heart of the project

management planning process.

• Scheduling is the crux of project management.

• The scheduling techniques are not nearly as important

to the final success of your projects as is the commitment

to performing these operations carefully, methodically,

and honestly.

Week 4 Summary

• Precedence relationships

• Time and Action (Gantt)

• Crashing projects

Next Week

• A project can be described by its:

– purpose, scope, outputs

• Breaking down work activity (WBS) is a process by which the project

is subdivided for management and control purposes:

– Areas of work

– Milestones

– Activities and Schedule