16 1 Project Planning Control Nigel Slack Stuart

16. 1 Project Planning & Control © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 2 Chapter Coverage • What is a project? • The project planning and control process • Network planning – Critical Path Method (CPM) © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 3 Projects: A project is a set of activities with a define start point and a define end state, which pursues a defined goal and uses a define set of resources. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 4 Stages in project management Stage 1 Understanding the project environment Stage 2 Stage 3 Project definition Changes Project planning Corrective action Stage 5 Stage 4 Technical execution © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Project control Operations Management, 4 E: Chapter 16

16. 5 Stage 1: Understanding project environment The project environment comprises the factors which may affect the project during its life. See slide 16. 6 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 6 Geo-social environment • Geography • National culture Econo-political environment • Economy • Government The Project Business environment • Customers • Competitors • Suppliers/sub-contractors Internal environment • Company strategy • Resources • Other projects Examples of factors that may affect the project environment © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 7 Stage 2: Project definition Three different elements define a project: • Its objective: the end state that project management is trying to achieve • Its scope: the exact range of the responsibilities taken on by the project management. • Its strategy: how project management is going to meet its objective. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 8 Project objectives The hierarchy of objectives: • At the top of the hierarchy is the overall objective or goal of the project, lower levels of the hierarchy are the objectives of each part of the project (big projects consists of many parts). • Objectives of each part must be related to its overall objective. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 9 Objectives must be clear: Good objectives are those which are clear, measurable and, preferably, quantifiable. One method of clarifying objectives is to break down project objectives into three categories: – Purpose: to prevent production from failing to meet output as forecast. – End result: a report which identifies the causes of lost production, and which recommends how the target output can be met. – Success criteria: the report should be completed by 30 June. The recommendations should enable output to reach at east 70 tonnes per year. Cost of the recommendations should not exceed RM 200, 000. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 10 The three project performance objectives Quality New aircraft project Fixed grant research project Cost © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Music festival Time Operations Management, 4 E: Chapter 16

16. 11 Project scope - Identifies the work content and the outcomes. - Boundary setting exercise – divides work content for each part of the project. - Important for managing contractors – commercial and legal aspect of the scope of supply. - Can change during the course of the project. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 12 Project strategy - Defines in general how the organization is - going to achieve its project objectives and meet the related measure of performance. Two ways: 1) Define phases (time based sections) of the project. 2) Set milestones at which specific reviews of time, cost and quality are made. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 13 Stage 3: Project planning Fulfills four distinct purpose, it determines: 1. 2. 3. 4. The cost and duration of the project. The level of resources needed. Helps to allocate work and monitor progress. Helps to assess the impact of changes to the project. There are five steps… © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 14 Stages in the project planning process Adjust as necessary Identify the activities in the project Estimate the times and resources for activities 1 2 Identify the relationships and dependencies between the activities © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 3 Identify time and resource schedule constraints Fix the schedule for time and resources 4 5 Operations Management, 4 E: Chapter 16

16. 15 1. Identify activities: Work breakdown structure 1. Serve breakfast in bed 2. Pour juice in glass 3. Fetch juice 4. Fetch glass 5. Place boiled egg in egg cup 6. Boil egg 10. Fetch egg cup 11. Butter the toast 12. Toast bread 15. Fetch butter 16. Arrange tray 17. Fetch tray, plates and cutlery 13. Slice bread 7. Fetch egg 8. Bring water to boil 14. Fetch bread 9. Fill pan with water © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

2. Estimate times and resources 16. 16 Table 16. 1 Time and resources estimates for a breakfast-in-bed” project No Activity Effort (person) Duration (secs) 1 Serve breakfast in bed 1 120 2 Pour juice in glass 1 5 3 Fetch juice 1 10 4 Fetch glass 1 10 5 Place boiled egg in egg cup 1 3 6 Boil egg 0 240 7 Fetch egg 1 10 8 Bring water to boil 0 180 9 Fill pan with water 1 8 10 Fetch egg cup 1 10 11 Butter the toast 1 10 12 Toast bread 0 30 13 Slice bread 1 30 14 Fetch bread 1 10 15 Fetch butter 1 10 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 17 Typical subjective probability distribution for an activity time estimate Probability Accuracy of estimates comes with experience! 3 5 6 Activity duration 13 Optimistic time Expected time Most likely time Pessimistic time © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 18 3. Identify relationship and dependencies • All activities will have some relationship with one another. • Dependent or series relationship or 1 Slice bread Toast bread Butter toast 2 Fill pan with water Bring water to boil • Parallel relationship © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 1 Boil egg & 2 Operations Management, 4 E: Chapter 16

16. 19 4. Identify schedule constraints • Resource constrained – only the available resource level are used in resource scheduling and are never exceeded hence, project completion might slip. • Time constrained – priority is to complete the project within a given time. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

“Making breakfast” - Do activities at earliest time 16. 20 0 1 2 Time (mins) 4 5 3 6 7 8 9 Orange Bread Toast Activities requiring operator time Butter Boil water Water Bed room Boil egg Staff required Tray 4 3 2 1 0 0 1 2 3 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 4 5 Time (mins) 6 7 8 9 Operations Management, 4 E: Chapter 16

“Making breakfast” – Minimizing staff requirements 16. 21 0 1 2 Time (mins) 4 5 3 6 7 8 9 Orange Bread Toast Butter Boil water Water Bed room Boil egg Staff required Tray 4 3 2 1 0 0 1 2 3 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 4 5 Time (mins) 6 7 8 9 Operations Management, 4 E: Chapter 16

16. 22 5. Fix the schedule “Making breakfast” – Maximizing toast quality 0 1 2 3 Time (mins) 4 5 6 7 8 9 Orange Bread Boil water Staff required Water Toast Butter Bed room Boil egg Tray 4 3 2 1 0 0 1 2 3 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 4 5 Time (mins) 6 7 8 9 Operations Management, 4 E: Chapter 16

16. 23 Stage 5: Project control 1. Project monitoring: current expenditure to date, amount of overtime authorized, inspection failure, progress of activities etc. 2. Assessing project performance: Compare planned and actual expenditure 3. Intervene to change the project: when the project is out of control in the sense of cost, quality levels or time, intervention is required. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 24 Network planning 1. Use of Gantt chart is the simplest technique that supports project planning and control. 2. More elaborate and detailed techniques are collectively called network analysis. 3. We will consider a network analysis method called Critical Path Method (CPM) © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 25 Critical Path Method 1. 2. 3. Represents the project activities diagrammatically. Project activities are represented by arrows (See 16. 26). At the tail (start) and head (finish) of each activity is a circle which represents and event (See 16. 27). Rules for drawing a network diagram: 1. An event cannot be reached until all activities leading to it are complete - (16. 27 – event 5 is not reached until c and e are completed). 2. No activity can start until its tail event is reached - (16. 27 – activity f cannot start until event 5 is reached). 3. No two activities can have the same heat and tail events (16. 28 – activities x and y cannot be drawn as first shown, they must be drawn using a dummy activity (no duration and shown as a dotted line) © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 26 Activities and network for a simple project a b c d e f Remove furniture Prepare bedroom Paint bedroom Prepare kitchen Paint kitchen Replace furniture None a b a d c, e om o r d e eb Remove furniture 1 2 3 1 2 1 Pa in tb ar rep P Activity duration (in days) Immediate predecessors Activity ed roo m Replace furniture Pr ep are n kit ch en © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 t ain he c t i k P Operations Management, 4 E: Chapter 16

16. 27 Network diagram for simple decorating project Activity reference a Activity duration 1 EET – the very earliest the event could possibly occur if all preceding activities are completed as early as possible. LET – the latest time that the event could possibly take place without delaying the whole project 1 Event number 3 An Event 1 a 2 b c 2 3 1 Earliest Event Time (EET) Latest Event Time (LET) 5 f 6 1 d e 1 2 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 4 Operations Management, 4 E: Chapter 16

16. 28 Activity on arrow – Using “dummy” activities 2 x x 2 1 1 3 y y 1 3 5 2 4 6 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 29 Critical Path – Network diagrams have more that one sequence of activities which will lead from the start to the end of the project – these sequence are called paths. – Each path has a total duration which is the sum of all its activities. – The path which has the longest sequence of activities is called the critical path. – It is called the critical path because any delay in and of the activities on this path will delay the whole project. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 30 Network analysis for simple decorating project With earliest and latest event times 3 3 1 0 2 a 0 1 1 3 b c 2 3 1 Chapter 16, Page 575 5 6 d e 1 2 4 2 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 6 f 6 1 7 7 4 Operations Management, 4 E: Chapter 16

16. 31 Worked Example • The chief surveyor of a firm that moves earth in preparation for the construction of roads has identified the activities and their durations for each stage of an operation to prepare a difficult stretch of motorway (see table below). The surveyor needs to know how long the project will take and which are the critical activities. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

Road Construction Activities 16. 32 Activity Duration Preceding activities A 5 - B 10 - C 1 - D 8 B E 10 B F 9 B G 3 A, D H 7 A, D I 4 F J 3 F K 5 C, J L 8 H, E, I, K M 4 C, J © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16

16. 33 Network Diagram For Motorway Project 18 A D 5 0 0 G 3 20 H 8 7 E B 10 10 C 1 10 9 L 27 10 F 27 8 35 35 I 4 19 K 19 3 J 22 © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 5 M 4 22 Operations Management, 4 E: Chapter 16

16. 34 The End © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4 E: Chapter 16