Chapter 7
project management
CHAPTER SEVEN
FORMS OF PROJECT ORGANIZATION AND PROJECT
PLANNING AND SCHEDULING
Part:- one :-
1. FORMS OF PROJECT ORGANIZATION
• This part deals with three different project management structures
used by firms to implement projects:
– functional organization,
– dedicated project teams, and
– matrix structure.
• Assignment four :- read about different forms of project organization and
than select one parent organization and critically analyze its form of project
organization and also Discuss its advantages and disadvantages)
Part two
2. PROJECT PLANNING AND SCHEDULING
Definition of project planning
• Planning is concerned with the future.
• Planning in a project environment may be described as establishing a
predetermined course of action within a forecasted environment.
• Project planning includes:-
– the prediction of the tasks necessary to achieve a goal,
– the estimation of required resources to accomplish the tasks, and
– the scheduling of people and tasks to meet the deadline.
• Planning is determining what needs to be done, by whom, and
when, in order to fulfil one’s assigned responsibility
– Planning the project involves determining:-
• what needs to be done (scope, deliverables),
• how it will get done (sequence of activities),
• who will perform it (human resources),
• how long it will take (schedule),
• how much it will cost (budget) and what are the risks?
What do we plan?
The work (Identify project activity
Estimate activity duration
Determine resource requirements:-Manpower/ Financial
resources
Construct/ analyze the project network.
Steps in Planning a Project
The following steps are to be followed while planning a project:
1. Project objectives, requirements, ad scope are set.
– These outcome elements specify project end results, desired results, and time,
cost, and performance targets.
2. The specific work activities, tasks, or jobs to achieve objectives are
broken down, defined, and listed. (What?)
3. A project organization is created specifying the departments,
subcontractors, and managers responsible for work activities. (Who?)
4. A schedule is prepared showing the timing of work activities, deadlines,
and milestones. (When, in what order?)
5. A budget and resource plan is prepared showing the amount and timing
of resources and expenditures for work activities and related items.
(How much and when?)
6. A forecast is prepared of time, cost, and performance projections for the
completion of the project. (How much time is needed, what will it cost,
and when will the project be finished?)
Tools/ Techniques of Planning and Scheduling
– Bar Chart (Gantt Chart)
– Network Techniques
• Critical path method (CPM)
• Program evaluation and review technique
(PERT)
…Cont’d
Tools of Project Planning
1. Bar chart(Ghant chart)
– A Gantt chart is a graphical depiction of the task
flow, with dates
– Dates are shown as the x-axis, so questions about
start/end times can be answered
• e.g. Relative start times of parallel tasks
• e.g. Completion of all of an activity’s tasks
• e.g. Chronological dependencies between tasks
A pictorial device in which activities are
represented with time
7
Project Management
Example of Gantt Chart
Month
0 | 2 | 4 | 6 | 8 | 10
Activity
Design house
and obtain
financing
Lay foundation
Order and
receive materials
Build house
Select paint
Select carpet
Finish work
1 3 5 7 9
Months 8
2. NETWORK
Network: It is a graphical and logical model or plan which
lists out the sequence of various operations which are
required to be performed for the final achievement of the
project objectives.
Network:- Shows the sequential relationships
among activities using nodes and arrows.
Use of nodes and arrows
Arrows an arrow leads from
tail to head directionally. Indicate Activity.
Activity:- A task or a certain amount of work
required in the project which requires time to
complete
Nodes A node is represented by a
circle
Indicate EVENT, a point in time where one or more
activities start and/or finish.
simplified network diagram for a dinner project indicates as follows;
Terms & Definitions:
Activity-
◦ Any portion of a project which consumes
time or resources & has a definite
beginning & an end is called as an activity.
◦ It is denoted by an arrow. The symbol above
arrow indicates activity description & the
number below indicates activity duration in
time units.
DESCRIPTION
DURATION
Event-
◦ The beginning & the completion of
activity is termed as an event.
◦ It indicates a particular instant of time at
which some specific milestone has been
achieved.
Node
Network logic-
This denotes the technical dependencies
among the activities.
e.g. Network logic in the network drawn
below is that activity A must be completed
before activity B can be started.
A B
1 3
2 Series
Example
network consists of three activities: designing the house, obtaining financing, and
actually building the house:-
1 Design house Obtain financing Build house
2 3 4
Here the arrows represent activities while the nodes
represent the start and the end of an activity (i.e. events).
When one activity depends upon another, both appear on the
diagram as two arrows having a common node.
Basic patterns of AOA diagrams(Activity on Arrow network (AOA)
C
• Types of activities
Predecessor activity: Activities that must be completed
immediately prior to the start of another activity are
called predecessor activities.
Successor activity: Activities that cannot be started
until one or more of other activities are completed, but
immediately succeed them are called successor activities.
Concurrent activities: Activities that can be
accomplished concurrently are known as concurrent
activities.
Types of event-
Tail event- an event which marks the
beginning of an activity
e.g. event 1 is said to be tail event to activity A as
it indicates the beginning of the activity A.
3
B
A C
1 2 5
D
4
Parallel
Head event- the event which marks the
completion of an activity.
e.g. head event to activity A as it
indicates the completion or end of
activity A.
3
B
A
1 2 C 5
D
4
Burst & merge event-
The nodes from which a number of
activities emerge are called as burst event
or burst node.
The nodes to which number of activities
converges are called as merge nodes or merge
events.
Error in networking
• Looping
• Dangling
• Mistake in succeeding and proceeding r/ship
Network
Errors in drawing Network - Looping
2
A B
1 3
C
Dangling
1 2 4
Event 1 is Start of Project Event 3 AND 4 is end of Project
3
Dummy activity:
A Dummy activity is an imaginary activity. It does not exist in the Project
activities.
It is used in the network diagram to show dependency relationship or
connectivity between two or more activities
consider a case where B and C have the same job reference and they can
be started independently on completion of A. But, D could be started only
completion of B and C. c
EXAMPLE NW
• Example 1: Assume bank branch opening project has following activities along with
time duration: such as marketing study ,discussion with sharholders,budget ,get
license from NBE,
Activity Duration(months
)
1-2 Marketing study 3
1-3 Discussion s.holders 4
1-4 budget 3
2-5 rent 4
3-5 RECRUITING EMPLOYEES 5
4- 5 hiring 7
5-6 License from NBE 3
6-7 OPENING 6
a)Draw the project network and identify all the paths.
2
3 4
1 4 5 3 6 6
7
3 5
3 7
4
Exercise :1- Draw project network diagram
Activities
1-2
1-3
2-4
3-4
2-5
4-5
5
1
4
3
Exercise :-ABC co. is bringing a new product on line to be
manufactured in their current facility. They have identified 11
activities and their precedence relationships.
Immediate Duration
Activity Description
Predecessor (weeks)
A Develop product specifications None 4
B Design manufacturing process A 6
C Source & purchase materials A 3
D Source & purchase tooling & equipment B 6
E Receive & install tooling & equipment D 14
F Receive materials C 5
G Pilot production run E&F 2
H Evaluate product design G 2
I Evaluate process performance G 3
J Write documentation report H&I 4
K Transition to manufacturing J 2
25 of 85 Network scheduling
Time estimation
25
Three times values are obtained
Optimistic time-time if no
complications arise
Most likely time-takes into account
normal delays
Pessimistic time-time required if
unusual complications arise
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26 of 85 8.5 Network scheduling
Average Time
26
te = (to + 4tm + tp)/6
where
te = weighted arithmetic average
time
to = optimistic time
tm = most likely time
t
Project Financing
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Management
p =andpessimistic
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ACTIVITY Time estimate
Example: Optimis Most Pessimis Average(te)
tic (to likely (tm tic (tp =(to+4tm+t
Project A p)/6
A,1-2 9 12 21 13
B,1-3 6 12 18 12
C, 2-4 1 1.5 5 2
D,3-4 4 8.5 10 8
E,2-5 10 14 24 15
F,4-5 1 2 3 2
activiti
es time 2 15
A,1-2 13 13
B,1-3 12 5
2
C, 2-4 2 1
D,3-4 8 2
E,2-5 15 12 8
3 4
F,4-5 2
28 of 85 8.5 Network scheduling
Determining the Critical Path
28
STEPS
1.Calculate the Earliest Occurrence Time
(EOT) for each event
Time at which the event can be
completed at the earliest. It is
computed beginning from event o
and moving forward.
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Example :-EOT for activities in
Project A
activities time
A,1-2 13
B,1-3 12
C, 2-4 2
D,3-4 8
E,2-5 15
F,4-5 2
E= 1
23 15 E= 2
13 8
E= 2
5
0
1
2
12 8
3 4
E= 1 E= 2
2 0
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Determining the Critical Path
30
STEPS
2. Calculate Latest occurrence time(LOT)
for each event
the latest allowable time by which
an event can occur , given the time
allowed for completion of the project.
Project completion time is EOT of the
last
Project Financing
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event.
and Management-Project
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Example :-LOT for activities in
Project A
activities time
A,1-2 13
B,1-3 12
C, 2-4 2
D,3-4 8
E,2-5 15
F,4-5 2
E= 1
23 15 L=2
13 8
E= 2
5
0
1
2
12 8
3 4
E= 1 L=2
8 6
32
E= 1
L=1
3 L=2
2 3 15
E8
=2
13 8
E= 5
2
0
1
2
L=0
12 8
3 4
E= 1
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Management 2
L=1 0
L=2
Exercise :-draw NW and find CPM
Event time
1-2 12
1-3 10
1-4 11
2-3 8
2-5 11
4-6 18
3-7 25
6-7 13
5-8 17
7-8 9
Example :-EOT for activities in the
above Project 1
12 1 25 7 8
5
1
1
2 8 3 9 4
1
2
23 2 74
1
1 0 0 5 1 5
1 1
1 4 2 6 3
1
8
34 of 85 8.5 Network scheduling
LOT for activities in THE ABOVE
Project 1
1
34 2 1 5 7 8
2 3 5
1
7 4
1
8 9
2
1
0 3 2 7
1
2 4
1 5
0 0 1 5
1 1 3
4
1 8 6
3
Project Financing4
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slack 1
35 2 1 5 7 8
1 1 2 3 5 5
2 2 1 3 7 4 4
1
8 9
2
1
1 0 2 3 2 7
2 4 4
1 0 5
00 0 1 5 5
1 1 3
1 4
8 2
6
1 3
1
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36 of 85 8.5 Network scheduling
Slack
Even LOT EOT (LOT-EOT)
36
t
1 0 0 0
2 12 12 0
3 20 20 0
4 14 11 3
5 37 23 14
6 32 29 3
7 45 45 0
8
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0
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Critical Path 1
37 2 1 5 7 8
1 1 2 3 5 5
2 2 1 3 7 4 4
1
8 9
2
1
1 0 2 3 2 7
2 4 4
1 0 5
00 0 1 5 5
1 1 3
1 4
8 2
6
1 3
1
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NEXT SLIDE- PART 2
