SCM Chapter 14 Vocab

project

According to PMI, a temporary endeavor undertaken to create a unique product, service, or result. Unlike other business activities, a project has a clear starting point and ending point, after which the people and resources dedicated to the project and are reassigned

project management tools

used to plan, measure, and track a projects progress. these tools help managers understand what activities need to be completed, who is responsible for various activities, and when the activities should be completed. they also allow managers to track the time it takes to complete activities and also the cost.

gantt chart

a graphical tool used to show expected start and end times for project activities and to track actual progress against these time targets. a gantt chart provides both a planning function and a control function. gantt charts have one weakness: they fail to explicitly show precedence relationships. example of gantt chart is on page 430

network path

a logically linked sequence of activities in a network diagram

critical path method (CPM)

a network based technique in which there is a single time estimate for each activity. CPM is used for projects where thre is a single time estimate for each activity.

activity on node (AON) diagram

a network diagram in which each activity is represented by a node, or box, and the precedence relationship between various activites are represented with arrows

critical path

a network path that has the longest, or is tied for the longest, linked sequence of activities. the duration of the project is equal to the duration of the critical paths

program evaluation and review technique (PERT)

a netwrok based technique in which there are multiple time estimates for each activity. PERT is used when the time estimates are less certain and it makes more senst to provide several estimates, like a pessimistic or optimistic estimate. PERT users can also detrmine the probability of completing a project by a certain target date by using normal distributon curve statitions.

milestones

a performance or time target for each major group of activities in a project. these milestones will be used to track the progress of the project. and organization must also define how the different tasks and activities that make up the project come together to result in a completed project. the detailed plan serves as a reference that enables everyone to determine how the project is progressing at various points in time

project management

according to PMI, the application of knowledge, skills, tools and techniques to project activities to meet project requirements

Project Management Institute

professional organizations that have emerged to educate practicing managers on state of the art tools and techniques.

critical activies

project activity for which the earliest start time and the largest start time are equal. a critical activity cannot be delayed witout legnthening the overall project duration

crashing

shortening the overall duration of a project by reducing the time it takes to perform certain activities.

review network diagram information

starting page 431

forward pass

the determination of the earliest start and finish times for each project activity.

backward pass

the detrmination of the lastest finish and start times for each project activity. this step is particularly imporant when tryin to determine what impact a delay might have on the length of a project

slack time

the difference betwen an activitys lateest start time (LS) and earlist start time (ES). slack time indicates the amount of allowable delay. critical activites have a slack time of 0. ST = LS - ES

earlist finish time (EF)

the earliest an activity can be finished, caluclated by adding the activitys duration to its earliest start time. EF = ES + activity duration

earliest start time (ES)

the earliest an activity can be started, as detrmined by the earliest finish time for all immediate predecessors. It is also the latest EF for all immediate predecessors.

postcompletion phase

the fifth of five phases of a project. this is the phase in which the project manager or team confirms the final outcome, conducts a postimplementation meeting to critique the project and personnel, and reassigns project personnel. This is the wrap up phase of project management.

concept phase

the first of the five pahses of a project. here, project planners develop a borad definition of what the project is and what its scope will be. Key outputs of this phase include initial budget estimates, estimates of personnel needed, and required completion dates. The budget estimates made during the concept phase are usually accurate to +/-30% compared to the actual final budget. Planners use this information not only to get an early fix on the scope of a project, but also to determine whether a project is feasible.

performance phase

the fource of five phases of a project. in this phase, the organization actually starts to execture the project plan. project managers play a particularly important role here in coordinating and directing the work effort and in ensuring that time and performace mlestones are met. depending on the type of projects, this may be the longest phase

latest finish time (LF)

the latest an activity can be finished and still finish the project on time, as determined by the latest start time for all immediate successors.

lastest start time (LS)

the latest an activity cdan be started and still finish the project on time, calculated by subtracting the activitys duration from its latest finish time LS = LF - activy duration

project definition phase

the second of five phases in a project. here, project planners identify how to accomplish the work, how to organize for the project, the key personnel and resources required to support the project, tentative schedules, and tentative budget requirements. Budget estimates begin to become more exact, with a target of +/- 5-10% compared to the actual final budget.

planning phase

the third of five phases of a project. here, project panners prepare detailed plans that identify activities, time and budget targets, and the resources needed to complete each task. this phase also includes putting in place the organization that will carry out the project. The planning phase is particularly critical because there is a strong relationship between effective planning and successful project outcomes

two techniques to a network diagram:

1. ciritical path method (CPM) 2. program evaluation and review technique (PERT) like gantt charts, these techniques require the user to identify the activities that make up a project and to determine their sequence and interrelationships. both CPM and PERT allow project managers to monitor progress over time while managing costs across all activties. PERT is rarely used in practice. Most managers find that CPM is better.

five phases of a generic project:

1. concept phase 2. project definition phase 3. planning phase 4. performance phase 5. postcompletion phase which the amount of time and resources spent on each phase will differe from one situation to the next, nearly all projects go through these phases. The finite nature of a project and the typically high level of resources are needed to both plan and carry out the project activities.

The process is the same in both CPM and PERT in constructing network diagrams:

1. enditify each unique activity in a project by a capital letter that corresponds only to that activity 2. represent each activity in the project by a node that shows the estimaded length. this style of network diagram is known as an activity on node (AON) diagram 3. if an activity has an immediate predecessor, show the realtionship by connecting the two activities with an arrow. the network diagram consists of all the activity nodes and arrows linking them together 4. determin the earliest start time (ES) and the earliest finish time (EF) for each activity by performing a forward pass 5. determine the latest finish time (LF) and the latest starting time (LS) for each activity by doing a backward pass 6. determine the critical activities and paths in the project.

two types of project management tools

1. gantt chart 2. network diagrams

steps to follow when crashing a project

1. list all network paths and their current legnths. mark all activities that can be crashed 2. focus on the critical path or paths. working one period at a time, choose the activity or activities that will shorten all critical paths at the least cost. the rule is this: never crash an activity that is not on a critical path, regardless of the cost. doing so will not shorten the project; it will only add costs 3. recalculate the lengths of all paths and repeat step two until the target project completion time is reached or until all options have been exhausted. further detail on page 435

Projects are distinct from typical business activities in four ways:

1. projects are nonroutine, 2. the nonroutine nature of projects often makes them very difficult to manage 3. projects typically require significant levels of cross-functional and interorganizational coordination 4. projects has defined ending point, at which time the project is completed

two trends that have pushed project management to the forefront:

1. the faster pace of stategic change 2. the changing role of middle management

do we need to know....

PMBOK

network diagram

a graphical tool that shows the logical linkages betwen activities in a project. example of diagram is on page 431