Mmzg523 Qmzg523 Cmzg523hhsmzg523-l12

8/18/2019 Mmzg523 Qmzg523 Cmzg523hhsmzg523-l12

1/59

BITS PilaniPilani Campus

MMZG 523 PROJECT

MANAGEMENT

ARUN MAITY


2/59


REDUCING PROJECT DURATION


3/59

BITS Pilani, Pilani Campus

• TIME TO MARKET: – A Six Month !la" In #$in%in% A P$o&u't Ma" R!sult In A ($oss P$o)it *oss O)

Ma$+!t Sha$! O) Aout -./

• UN0ORESEEN E*AY – 1!ath!$, !si%n 0la2, E3uipm!nt #$!a+&o2n

• INCENTI4E CONTRACTS: R!2a$&in% )o$ O2n!$ an&

Cont$a'to$

NEED FOR REDUCING

PROJECT DURATION


4/59


• IMPOSE EA*INES – Politi'ians Ma+! A Puli' Stat!m!nt

– CEO R!ma$+s In A Sp!!'h

– Al2a"s R!sults In 5i%h!$ Costs Than On! Plann!& Usin% *o26'ost An& !tail!&Plannin%

• 4ERY 5I(5 O4ER5EA COSTS – Examin! Th! i$!'t Costs O) Sho$t!nin% Th! C$iti'al Path 4s O7!$h!a& Cost

Sa7in%s


5/59


• AIN( RESOURCES

– A&&itional Sta)) An& E3uipm!nt

– Tas+s A$! Pa$tition!& So Minimal Communi'ation Is N!!&!& #!t2!!n 1o$+!$s

– A&&itional Manpo2!$ In'$!as!s Communi'ation, Coo$&ination An& E))o$ts

• REASSI(N KEY E8UIPMENT AN 9 OR PEOP*E

– Cost O) Comp$!ssin% 4s Cost O) R!l!asin% K!" E3uipm!nt An& 9O$ P!opl!

ACCELERATING PROJECT COMPLETION

WITH UNLIMITED RESOURCES


6/59


• OUTSOURCIN( PROECT 1ORK

– Su'ont$a't An A'ti7it"

– A''!ss To Sup!$io$ T!'hnolo%", S+ill!& Manpo2!$ An& Exp!$tis!

– 0$!!s Up R!sou$'!s That Can #! Assi%n!& To A C$iti'al A'ti7it"


7/59BITS Pilani, Pilani Campus

SC5EU*IN( O4ERTIME – In'$!as! 1o$+in% Tim!

– A7oi& A&&itional Costs O) Coo$&ination An& Communi'ation

– I) Sala$i!&, No R!al A&&itional Cost 0o$ Ext$a 1o$+

– 0!2!$ ist$a'tion 1h!n P!opl! 1o$+ Outsi&! No$mal 5ou$s



ESTA#*IS5 A CORE PROECT TEAM – C$!at! A !&i'at!& Co$! T!am To Compl!t! A P$o;!'t To Sp!!&

– A7oi&s 5i&&!n Cost O) Multi6tas+in%

O IT T1ICE – 0AST AN CORRECT*Y

– o Ri%ht Thin%s At Ri%ht Tim!

– T!mpo$a$" A$$an%!m!nts Onl" A&&s Costs An& oin% Th! 1o$+ A%ain



• 0AST TRACKIN(

– C$iti'al A'ti7iti!s A$! on! Con'u$$!ntl" 9 Pa$all!l Rath!$ Than Sus!3u!ntl"

– 0$om 0inish To Sta$t R!lationship To Sta$t To Sta$t R!lationship

• CRITICA* C5AIN

– R!3ui$!s Consi&!$al! T$ainin% An& A Shi)t In 5aits An& P!$sp!'ti7! That Ta+!Tim! To A&opt

– *on% T!$m Mana%!m!nt Commitm!nt Is N!'!ssa$"

ACCELERATING PROJECT COMPLETION

UNDER LIMITED RESOURCES



• REUCIN( PROECT SCOPE – TO REUCE OR SCA*E #ACK T5E SCOPE

• Tas+s, !li7!$al!s Can #! R!&u'!&9Eliminat!&

– REUCTION IN 0UNCTIONA*ITY O0 T5E PROECT

– *EAS TO #I( SA4IN(S IN #OT5 TIME AN MONEY

– REUCE 4A*UE O0 T5E PROECT

– CA*CU*ATIN( T5E SA4IN(S O0 REUCE PROECT SCOPE

• COMPROMISE 8UA*ITY – R!&u'in% 8ualit" Is Ra$!l" A''!pt!&



• IRECT COSTS: – *ao$

– Mat!$ial

– E3uipm!nt

– Su'ont$a'to$s

• Assi%n!& To 1o$+ Pa'+a%! An& A'ti7it"

• No$mal Cost : *o2 Cost E))i'i!nt M!tho&

• i$!'t Costs In'$!as! 1ith R!&u'tion In P$o;!'t u$ation

PROJECT COST-DURATION

GRAPH



• INIRECT COSTS – O4ER5EA COSTS

• Sup!$7ision

• A&minist$ation

• Consultants

• Int!$!st

• Can #! Assi%n!& To 1o$+ Pa'+a%! An& A'ti7it"

• R!&u'tion In Tim! R!sults In R!&u'tion In In&i$!'t Costs



• 0in& Th! i$!'t Costs 0o$ S!l!'t!& P$o;!'t u$ation

• 0in& Total In&i$!'t Costs 0o$ S!l!'t!& P$o;!'t u$ations

• Sum i$!'t An& In&i$!'t Costs 0o$ Th!s! S!l!'t!&u$ation To (!t Total Costs

CONSTRUCTING GRAPH



• No$mal Tim!: *o2 Cost, R!alisti', E))i'i!nt M!tho&s 0o$Compl!tin% Th! A'ti7it" Un&!$ No$mal Con&itions

• No$mal Cost: Th! i$!'t Cost 0o$ Compl!tin% An A'ti7it"In Its No$mal Tim!

• C$ash Tim! : Th! Sho$t!st Possil! Tim! An A'ti7it" Can#! R!alisti'all" #! Compl!t!&

• C$ash Cost: Th! i$!'t Cost 0o$ Compl!tin% An A'ti7it"In Its C$ash Tim!



• Th! Cost Tim! R!lationship Is *in!a$

• No$mal Tim! Assum!s *o26'ost E))i'i!nt M!tho&s ToCompl!t! Th! A'ti7it"

• C$ash Tim! R!p$!s!nts A *imit

• Slop! R!p$!s!nts Cost P!$ Unit Tim!

• All A''!l!$ations Must O''u$ 1ithin Th! No$mal An& C$ashTim!s

ASSUMPTIONS



CRAS5 S*OPE < CRAS5 COST 6 NORMA* COST

NORMA* TIME – CRAS5 TIME

COST SLOPE



• C$ash Tim!s

• *in!a$it" Assumption

• Choi'! O) A'ti7iti!s To C$ash R!7isit!&

LIMITATIONS



• R!&u'! P$o;!'t S'op!

• 5a7! O2n!$ Ta+! On Mo$! R!sponsiilit"

• Outsou$'in% P$o;!'t A'ti7iti!s O$ E7!n Th! Enti$! P$o;!'t

• #$ainsto$min% Cost Sa7in%s Option

COST REDUCTION


19/59

PROBLEM NO. 1

ACTIVITY

PREDECESSOR

NORMALTIME

NORMALCOST

CRASHTIME

CRASHCOST

MAXCRASHTIME

COSTSLOPE

A - 3 50 2 70 1 20

B A 6 80 4 160 2 40

C A 10 60 9 90 1 30

D A 11 50 7 150 4 25

E B 8 100 6 160 2 30F C,D 5 40 4 70 1 30

G E, F 6 70 6 70 0 0


20/59

FIND THE LEAST COST SCHEDULE

IF

• INIRECT COSTS:

PROJECT DURATION INDIRECT COST

25 400

24 350

23 300

22 250

21 200


21/59


22/59

A 3C

10

G 6

E 8

F 5

D

11

B 6


23/59


• C$iti'al Path : A – – 0 – ( u$ation: =. a"s

• Total Cost < >.? @ >?? < .?

• Minimum Cost Slop! – A'ti7it" ( < ? Cannot #! C$ash!&

– A'ti7it" A < =? C$ash #" On! a"

• C$iti'al Path A6606( u$ation < =>

• Total Cost < >.? @ =? @ -.? < =?


24/59


• Minimum Cost Slop! – A'ti7it" < =. C$ash A'ti7it" #" On! a"

• C$iti'al A'ti7iti!s : A 6 06 ( An& A6C606(

• u$ation: =- a"s

• Total Cost < >B? @ =. @ -?? < B.

• C$ash A'ti7it" 0 #" On! a" As It Is Common 0o$ #othTh! C$iti'al Path

• C$iti'al A'ti7it" < A6606(D A6C606(D A6#6E6(• u$ation< == a"s

• Total Cost < >. @ -? @ =.? < BB.


25/59


• C$ash A'ti7it" C An& E #" On! a"

• u$ation < =F a"s

• Total Cost < .=. @ -? @ =. @ -? @ =?? < F?

• 5!n'! Optimal S'h!&ul!:

• u$ation < == a"s Cost < BB.


26/59


ACTIVITY NORMALTIME

CRASHTIME

NORMALCOST

CRASHCOST

1-2 5 3 3000 5400

1-3 7 - 9800 -

2-4 10 6 12000 15000

2-5 9 - 9720

3-5 6 5 4320 7500

4-5 4 3 3040 6000

4-6 8 4 3200 4800

5-6 12 10 11520 17100

6-7 8 6 5120 24000

PROBLEM NO. 2


27/59


INIRECT COST < F???9AY

CRITICA* PAT5 – F6=6>6.6G6B URATION: - AYS

COST O0 PROECT < F,??,B=?


28/59


CRASH DURATION DIRECTCOST

INDIRECTCOST

TOTALCOST

INITIAL 39 100720

2-4 BY

4DAYS

35 100720 +

4*750

-4000 99720

1-2 BY 2DAYS

33 99720 +2*1200

-2000 100120

5-6 BY 2

DAYS

31 100120 +

2* 2790

-2000 103700

4-5 AND 3-5

BY 1 DAY

30 103700 +

1* 2960 +1* 3180

-1000 108840

6-7 BY 2

DAYS

28 108840 +

2* 9440

-2000 125720


29/59


PROGRESS & PERFORMANCEMANAGEMENT AND EVALUATION


30/59


• Cont$ol 5ol&s P!opl! A''ountal!

• P$!7!nts Small P$ol!ms 0$om Mush$oomin% Into *a$%!P$ol!ms

• K!!ps 0o'us!&

• Comp!titi7! E&%!

• E))!'ti7! Cont$ol Th$ou%h P$op!$ In)o$mation S"st!m

NEED


31/59


• !t!$minin% 1hat ata To #! Coll!'t!&

• 5o2, 1h!n An& 1ho 1ill Coll!'t Th! ata

• ata Anal"sis

• R!po$tin% Cu$$!nt P$o%$!ss

PROJECT MONITORING

INFORMATION SYSTEM


32/59


• A'tual A'ti7it" u$ation• R!sou$'! Usa%! An& Rat!s

• A'tual Costs

• Compa$! : – Plann!& 4s A'tual

– SC5EU*E 4s A'tual

DATA COLLECTION AND

ANALYSIS


33/59


• ata To #! Coll!'t!& #"

– P$o;!'t T!am M!m!$s

– In&i7i&ual Cost En%in!!$s

– P$o;!'t Mana%!$

• Sou$'!s

– Cash 0lo2

– Ma'hin! 5ou$s

– *ao$ 5ou$s

– Mat!$ials In Pla'!


34/59


R!po$ts An& R!po$tin% – P$o%$!ss Sin'! *ast R!po$t

– Cu$$!nt Status O) P$o;!'t

• S'h!&ul!

• Cost• S'op! – Cumulati7! T$!n&s

– P$ol!ms An& Issu!s Sin'! *ast R!po$t

• A'tion An& R!solution O) Ea$li!$ P$ol!ms

• N!2 4a$ian'!s An& P$ol!ms I&!nti)i!&• Co$$!'ti7! A'tion Plann!&


35/59


• S!ttin% Th! #as!lin! Plan

• Monito$in% P$o%$!ss An& P!$)o$man'!

• Compa$in% Plan 4s A'tual

• Ta+in% A'tions

PROJECT CONTROL

PROCESS


36/59


• P$!pa$in% (antt Cha$t – *ist Th! A'ti7iti!s 1ith u$ation

– P$!&!'!sso$ R!lationship

– C$iti'al Path

– T$a'+in% (antt Cha$t

• P$o%$!ss• Slippa%!s

• Sla'+

MONITORING TIME

PERFORMANCE


37/59


• Monito$ Past P$o;!'t S'h!&ul! P!$)o$man'!• Cu$$!nt P!$)o$man'!

• Estimat! 0utu$! S'h!&ul! T$!n&s

• Plot Th! i))!$!n'! #!t2!!n S'h!&ul!& Tim! On Th!C$iti'al Path At Th! R!po$t at! 1ith Th! A'tual PointOn Th! C$iti'al Path

• 1a$nin% Si%nals 0o$ Pot!ntial P$ol!ms

CONTROL CHARTS


38/59


Tim! Phas!& #u&%!t #as!lin!Compa$isons 1ith A'tual An& Plann!& S'h!&ul! An& Cost

E4: Ea$n!& 4alu!

P4: Plann!& 4alu!

AC: A'tual Cost

C4: Cost 4a$ian'! S4: S'h!&ul! 4a$ian'!

#AC: #u&%!t!& Cost At Compl!tion

ETC: Estimat!& Cost To Compl!t! R!mainin% 1o$+

EAC: Estimat!& Cost At Compl!tion

4AC: Cost 4a$ian'! At Compl!tion

EARNED VALUE

COSTSCHEDULE SYSTEM

INTEGRATED COST


39/59


!)in! Th! 1o$+ Usin% 1#S – S'op!

– 1o$+ P$o%$!ss

– !li7!$al!s

– O$%aniHation Units

– R!sou$'!s

– #u&%!ts 0o$ Ea'h 1o$+ Pa'+a%!

INTEGRATED COST

SCHEDULE SYSTEM


40/59


• !7!lop 1o$+ An& R!sou$'! S'h!&ul!

– S'h!&ul! R!sou$'!s To A'ti7iti!s

– Tim!6phas! 1o$+ Pa'+a%!s Into N!t2o$+

• !7!lop Tim! Phas!& #u&%!t Usin% 1o$+ Pa'+a%!s An& !t!$min! Plann!& #u&%!t!& Cost O) Th! 1o$+S'h!&ul!&

• At 1o$+ Pa'+a%! *!7!l, Coll!'t A'tual Costs 0o$ Th!

1o$+ P!$)o$m!&• Coll!'t P!$'!nt Compl!tion An& Comput! #u&%!t!&

Cost O) 1o$+ P!$)o$m!& : Ea$n!& 4alu!


41/59


• To M!asu$! O7!$all P!$)o$man'! #" Usin% A%%$!%at!P!$)o$man'! M!asu$! Call!& Ea$n!& 4alu!

• To Compa$! Th! A'tual An& S'h!&ul!& Cost 1ithPlann!&

• Ea$n!& 4alu! Is Cal'ulat!& #" Multipl"in% Th! Estimat!&P!$'!nt Ph"si'al Compl!tion O) 1o$+ 0o$ Ea'h Tas+ #"Th! Plann!& Cost 0o$ Thos! Tas+s

TIME PHASED BUDGET

WAYS TO CALCULATE


42/59


• Th! .?6.? Estimat!: 0i)t" P!$'!nt Compl!tion Is Assum!& 1h!n Th! Tas+ Is #!%un An& R!mainin% 0i)t"P!$'!nt 1h!n Th! 1o$+ Is Compl!t!

• Th! ?6F?? P!$'!nt Rul!: This Rul! Allo2s Th! C$!&it O)

1o$+ Until Th! Tas+ Is Compl!t!• C$iti'al Input Us!: This Rul! Assi%ns Tas+ P$o%$!ss

A''o$&in% To Th! Amount O) C$iti'al Input That 5as#!!n Us!&

• Th! P$opo$tionalit" Rul!: This Rul! i7i&!s A'tual Tas+Tim! To at! #" Total S'h!&ul!& Tas+ Tim! To Cal'ulat!P!$'!nt Compl!t!

WAYS TO CALCULATE

PERCENT COMPLETION


43/59


#C1P 9 E4: #u&%!t!& Cost O) 1o$+ P!$)o$m!& < Ea$n!&4alu!

AC1P9 AC: A'tual Cost O) 1o$+ P!$)o$m!&

#C1S 9 P4: #u&%!t!& Cost O) 1o$+ S'h!&ul!&

#AC : #u&%!t At Compl!tionETC: Estimat!& Cost To Compl!t!

EAC < Estimat!& Cost At Compl!tion

TERMINOLOGY


44/59


COST 4ARIANCE C4 < E4 – ACSC5EU*E 4ARIANCE S4 < E4 – P4

TIME 4ARIANCE T4 < ST – AT

C4 : I0 NE(ATI4E : O4ERRUNS4 : I0 NE(ATI4E : #E5IN SC5EU*E

T4: E*AY IS NE(ATI4E


45/59


COMPUTE SC5EU*E 4ARIANCE E46P4J, COST4ARIANCE E46ACJ

PERCENT COMP*ETE

– .?6.? ESTIMATE – ? – F?? ESTIMATE

– PROPORTIONA*ITY RU*E


46/59


• Compa$in% Ea$n!& 4alu! 1ith Th! Exp!'t!& S'h!&ul!4alu!

• Compa$in% Ea$n!& 4alu! 1ith Th! A'tual Costs

• C4 < E46 AC I) N!%ati7!, O7!$ Run

• S4 < E4 – P4 I) N!%ati7! #!hin& S'h!&ul!

VARIANCE ANALYSIS

DEVELOPING A STATUS


47/59


• #as!lin! !7!lopm!nt

• !7!lopm!nt O) Status R!po$t – Not Y!t Sta$t!&

– 0inish!&

– In P$o'!ss O$ Pa$tiall" Compl!t!

DEVELOPING A STATUS

REPORT


48/59

PERFORMANCE INDE!

• CPI < E4 9 AC

•SPI < E4 9 P4INDEX CPI SPI

>1.00 UNDE UN A!EAD "F

SC!EDULE

#1.00 "N C"ST "N SC!EDULE

$1.00 "%E UN BE!IND

SC!EDULE

PROJECT PERCENT


49/59


• PERCENT COMP*ETE INE PCI# < E4 9 #AC• PCI# REPRESENTS T5E 1ORK ACCOMP*IS5E AS

PERCENT O0 T5E TOTA* #U(ETE O**ARS TOATE

• PERCENT COMP*ETE INE PCIC < AC 9 EAC

• PCIC REPRESENTS PERCENT COMP*ETE INTERMS O0 ACTUA* O**ARS SPENT TO

ACCOMP*IS5 1ORK TO ATE AN T5E ACTUA*EPECTE O**ARS 0OR T5E COMP*ETEPROECT

PROJECT PERCENT

COMPLETE INDE!

FORECASTING FINAL


50/59


EAC < AC @ ETC

ETC < 1ORK REMAININ( 9 CPI

< #AC – E4J 9 E49AC

TCPI : TO COMP*ETE PER0ORMANCE INE TCPIJ

TCPI < #AC – E4J 9 #AC – ACJ

It M!asu$!s Th! Amount O) 4alu! Ea'h R!mainin%olla$ In Th! #u&%!t Must Ea$n To Sta" 1ithin #u&%!t

FORECASTING FINAL

PROJECT COST


51/59


• A P$o;!'t To !7!lop A Count$" Pa$+ 5as An A'tual CostIn Month FB O) L-.?,???, A Plann!& Cost O) L>.?,???,

An& A 4alu! Compl!t!& O) L-??,??? 0in& Th! Cost An&S'h!&ul! 4a$ian'!s An& Th! Th$!! In&i'!s

• (I4EN : AC < -.?,??? P4 < >.?,???

• E4 < -??,???

• COST 4ARIANCE < E4 – AC < -??,??? – -.?,??? <6.?,??? O4ERRUN

P"#$%' (#. 1


52/59


• SC5EU*E 4ARIANCE < E4 – P4 < -??,??? – >.?,???< 6F.?,??? #E5IN SC5EU*E

• CPI < E49 AC < -??,???9-.?,??? < ?.B

• SPI < E4 9 P4 < -??,??? 9 >.?,??? < ?GGG

• CSI < CPI SPI < ?.B ?GGG < ?.BF


53/59


• A P$o;!'t To !7!lop T!'hnolo%" T$ainin% S!mina$s Is .a"s #!hin& S'h!&ul! At a" G. It 5a& A Plann!& CostO) LB-.,??? 0o$ This Point In Tim!, #ut Th! A'tual CostIs Onl" L..?,??? Estimat! Th! S'h!&ul! An& Cost4a$ian'!s

PROBLEM NO. 2


54/59


(I4EN P4 < B-.,??? AC < ..?,??? E4 < G?9G. B-.,??? < GB,>G=

COST 4ARIANCE < E4 – AC < GB,>G= – ..?,??? <

F=,>G= UNERRUNSC5EU*E 4ARIANCE < E4 – P4 < GB,>G= – B-.,??? <

6 .G,.- #E5IN SC5EU*E

SOLUTION 2


55/59

PROBLEM NO. 3

• 0OR T5E 0O**O1IN( TESTMARKETIN( PROECT AT 1EEK G,CA*CU*ATE T5E COST SC5EU*E

AN TIME 4ARIANCES A*SOCA*CU*ATE T5E CPI, SPI, CSI, ETC

AN EAC

ACTIVITY

PREDECESSOR

DURATION

BUDGET

ACTUALCOST

%COMPLETE

A - 2 300 400 100

B - 3 200 180 100

C A 2 250 300 100

D A 5 600 400 20

E B,C 4 400 200 20


56/59

SOLUTION 3APV

EV

150150

150150

B 100

100

100

100

C 125

125

125

125D 300

300

300

E 200

200

200

T"TAL& '%

250 150 525 125 200 0 300 200

CU(. 250 400 925 1050 1250 1250 1550 1750

AC 0 400 180 300 0 0 400 200

CU(. 0 400 580 880 880 880 1280 1480

E% 250 150 525 125 200 0


57/59


ON AY G

E4 < F=.?

P4 < F=.?

AC < ?


58/59


• COST 4ARIANCE : E4 – AC < F=.? – ? < -B?UNERRUN

• SC5EU*E 4ARIANCE < E4 – P4 < F=.? – F=.? < ?ON SC5EU*E

• CPI < E49AC < F=.? 9 ? < F>=

• SPI < E49P4 < F=.? 9 F=.? < F??

• CSI < F>= F?? < F>=


59/59

• #AC < FB.? E4 < F=.? CPI < F>=

• ETC < #AC – E4J 9 CPI < FB.? – F=.?J 9 F>= < -.=

• EAC < ETC @ AC < -.= @ ? < F=-=

Mmzg523 Qmzg523 Cmzg523hhsmzg523-l12

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