Você está na página 1de 21

1

Name Muhammad Shabbir Roll No. 508194950


Course: Project Management (569) Autumn, 2009

Assignment No. 01

Q. no. 01

Assume a business organization which is involved in managing


various projects on contract basis. Discuss their ways and procedures
of getting new project contracts and managing the projects
accordingly.

A successful Project Manager must simultaneously manage the four basic


elements of a project: resources, time, money, and most importantly, scope. All
these elements are interrelated. Each must be managed effectively. All must be
managed together if the project, and the project manager, is to be a success.

• Resources
People, equipment, material
• Time
Task durations, dependencies, critical path
• Money
Costs, contingencies, profit
• Scope
Project size, goals, requirements

Most literature on project management speaks of the need to manage and


balance three elements: people, time, and money. However, the fourth element is
the most important and it is the first and last task for a successful project
manager. First and foremost you have to manage the project scope.

A successful Project Manager must effectively manage the resources assigned to


the project. This includes the labor hours of the designers, the builders, the
testers and the inspectors on the project team. It also include managing any labor
subcontracts. However, managing project resources frequently involves more
than people management. The project manager must also manage the equipment
used for the project and the material needed by the people and equipment
assigned to the project.

• People
Project employees, vendor staff, subcontract labor
• Equipment
Cranes, trucks, backhoes, other heavy equipment or
Development, test, and staging servers, CD burners or
Recording studio, tape decks, mixers, microphones and speakers
• Material
Concrete, pipe, rebar, insulation or
CD blanks, computers, jewel cases, instruction manuals

Managing the people resources means having the right people, with the right
skills and the proper tools, in the right quantity at the right time. It also means
ensuring that they know what needs to be done, when, and how. And it means
motivating them to take ownership in the project too.

Managing direct employees normally means managing the senior person in each
group of employees assigned to your project. Remember that these employees
also have a line manager to whom they report and from whom the usually take
technical direction. In a matrix management situation, like a project team, your
job is to provide project direction to them. Managing labor subcontracts usually
means managing the team lead for the subcontracted workers, who in turn
manages the workers.
2

The equipment you have to manage as part of your project depends on the nature
of the project. A project to construct a frozen food warehouse would need earth
moving equipment, cranes, and cement trucks. For a project to release a new
version of a computer game, the equipment would include computers, test
equipment, and duplication and packaging machinery. The project management
key for equipment is much like for people resources. You have to make sure you
have the right equipment in the right place at the right time and that it has the
supplies it needs to operate properly.

Most projects involve the purchase of material. For a frozen food warehouse, this
would be freezers, the building HVAC machinery and the material handling
equipment. For a project to release a music CD by a hot new artist, it would
include the CD blanks, artwork for the jewel case, and press releases to be sent to
deejays. The project management issue with supplies is to make sure the right
supplies arrive at the right time (we'll talk about the right price later).

All your skill in managing resources won't help, however, unless you can stick to
the project schedule. Time management is critical in successful project
management.

Time management is a critically important skill for any successful project


manager. I have observed that Project Managers who succeed in meeting their
project schedule have a good chance of staying within their project budget. The
most common cause of blown project budgets is lack of schedule management.
Fortunately there is a lot of software on the market today to help you manage
your project schedule or timeline.

• Tasks
Duration, resources, dependencies
• Schedule
Tasks, predecessors, successors
• Critical Path
Changeable, often multiple, float

Any project can be broken down into a number of tasks that have to be
performed. To prepare the project schedule, the project manager has to figure out
what the tasks are, how long they will take, what resources they require, and in
what order they should be done. Each of these elements has a direct bearing on
the schedule.

If you omit a task, the project won't be completed. If you underestimate the
length of time or the amount of resources required for the task, you may miss
your schedule. The schedule can also be blown if you make a mistake in the
sequencing of the tasks.

Build the project schedule by listing, in order, all the tasks that need to be
completed. Assign a duration to each task. Allocate the required resources.
Determine predecessors (what tasks must be completed before) and successors
(tasks that can't start until after) each task. It's pretty simple and straightforward.
For instance, think of a project called "Getting Dressed In The Morning". The
task "put on shirt" may have a longer duration if it is a buttoned dress shirt than
if it's a pullover. It doesn't matter which order you complete the tasks "put on
right shoe" and "put on left shoe", but it is important to complete the "put on
pants" task before starting the "put on shoes" task.

The difficulty in managing a project schedule is that there are seldom enough
resources and enough time to complete the tasks sequentially. Therefore, tasks
have to be overlapped so several happen at the same time. Project management
software (see sidebar) greatly simplifies the task of creating and managing the
project schedule by handling the iterations in the schedule logic for you.

When all tasks have been listed, resourced, and sequenced, you will see that some
tasks have a little flexibility in their required start and finish date. This is called
3

float. Other tasks have no flexibility, zero float. A line through all the tasks with
zero float is called the critical path. All tasks on this path, and there can be
multiple, parallel paths, must be completed on time if the project is to be
completed on time. The Project Manager's key time management task is to
manage the critical path.

Be aware, that items can be added to or removed from the critical path as
circumstances change during the execution of the project. Installation of security
cameras may not be on the critical path, but if the shipment is delayed, it may
become part of the critical path. Conversely, pouring the concrete foundation
may be on the critical path, but if the project manager obtains an addition crew
and the pour is completed early it could come off the critical path (or reduce the
length of the critical path).

Regardless of how well you manage the schedule and the resources, there is one
more critical element - managing the budget.

Often a Project Manager is evaluated on his or her ability to complete a project


within budget. If you have effectively managed the project resources and project
schedule, this should not be a problem. It is, however, a task that requires the
project manager's careful attention. You can only manage effectively a limited
number of cost items, so focus on the critical ones (see the 80-20 Rule in the
sidebar).

• Costs
Estimated, actual, variability
• Contingencies
Weather, suppliers, design allowance
• Profit
Cost, contingencies, remainder

Each project task will have a cost, whether it is the cost of the labor hours of a
computer programmer or the purchase price of a cubic yard of concrete. In
preparing the project budget, each of these costs is estimated and then totaled.
Some of these estimates will be more accurate than others. A company knows
what it will charge each of its projects for different classifications of labor.
Commodities like concrete are priced in a very competitive market so prices are
fairly predictable. Other estimates are less accurate. For instance, the cost of a
conveyor system with higher performance specifications that normal can be
estimated to be more expensive, but it is hard to determine whether it will be 10%
more or 15% more. For an expensive item, that can be a significant amount.

When the estimated cost of an item is uncertain, the project budget often
includes a design allowance. This is money that is set aside in the budget "just in
case" the actual cost of the item is wildly different than the estimate.

Unusual weather or problems with suppliers are always a possibility on large


projects. Companies usually include a contingency amount in the project budget
to cover these kinds of things.

So a project budget is composed of the estimated cost, plus the contingency and
design allowance, plus any profit. The project manager's job is to keep the actual
cost at or below the estimated cost, to use as little of the design allowance and
contingency as possible, and to maximize the profit the company earns on the
project.

To maximize your chances of meeting your project budget, meet your project
schedule. The most common cause of blown budgets is blown schedules. Meeting
the project schedule won't guarantee you will meet the project budget, but it
significantly increases your chances. And above all, manage the project scope.
Don't allow the project scope to "creep" upward without getting budget and/or
schedule adjustments to match.
4

Successful project management is an art and a science that takes practice. The
ideas presented above can give you a basic understanding of project
management, but consider it only a beginning. If your job or career path includes
project management, and you want to improve your skills, talk to successful
project managers, read, and practice. Project management can be a very
rewarding career.

The project scope is the definition of what the project is supposed to accomplish
and the budget (of time and money) that has been created to achieve these
objectives. It is absolutely imperative that any change to the scope of the project
have a matching change in budget, either time or resources. If the project scope is
to build a building to house three widgets with a budget of $100,000 the project
manager is expected to do that. However, if the scope is changed to a building for
four widgets, the project manager must obtain an appropriate change in
budgeted resources. If the budget is not adjusted, the smart project manager will
avoid the change in scope.

Usually, scope changes occur in the form of "scope creep". Scope creep is the
piling up of small changes that by themselves are manageable, but in agregate are
significant. For example, the project callls for a building to be 80,000 square feet
in size. The client wants to add a ten foot long, 4 foot wide awning over one bay
door. That's a pretty minor change. Later the client wants to extend the awing 8
feet to cover the adjacent bay. Another minor change. Then it's a change to block
the upwind side to the covered area to keep out the wind. Later, it's a request to
block the other end to make the addition more symetrical. Eventually, the client
asks for a ceiling under the awning, lights in the ceiling, electrical outlets, a water
faucet for the workers, some sound-proofing, and a security camera. By now, the
minor change has become a major addition. Make sure any requested change, no
matter how small, is accompanied by approval for a change in budget or schedule
or both.

You can not effectively manage the resources, time and money in a project unless
you actively manage the project scope.

When you have the project scope clearly identified and associated to the timeline
and budget, you can begin to manage the project resources. These include the
people, equipment, and material needed to complete the project.

1. Define the Scope


The first, and most important, step in any project is defining the scope of
the project. What is it you are supposed to accomplish by managing this
project? What is the project objective? Equally important is defining what
is not included in the scope of your project. If you don't get enough
definition from your boss, clarify the scope yourself and send it back
upstairs for confirmation.
2. Determine Available Resources
What people, equipment, and money will you have available to you to
achieve the project objectives? As a project manager, you usually will not
have direct control of these resources, but will have to manage them
through matrix management. Find out how easy or difficult that will be to
do.
3. Check the Timeline
When does the project have to be completed? As you develop your project
plan you may have some flexibility in how you use time during the project,
but deadlines usually are fixed. If you decide to use overtime hours to meet
the schedule, you must weigh that against the limitations of your budget.
4. Assemble Your Project Team
Get the people on your team together and start a dialog. They are the
technical experts. That's why their functional supervisor assigned them to
the project. Your job is to manage the team.
5

5. List the Big Steps


What are the major pieces of the project? If you don't know, start by asking
your team. It is a good idea to list the steps in chronological order but
don't obsess about it; you can always change the order later.
6. List the Smaller Steps
List the smaller steps in each of the larger steps. Again, it usually helps you
remember all the steps if you list them in chronological order. How many
levels deep you go of more and more detailed steps depends on the size
and complexity of your project.
7. Develop a Preliminary Plan
Assemble all your steps into a plan. What happens first? What is the next
step? Which steps can go on at the same time with different resources?
Who is going to do each step? How long will it take? There are many
excellent software packages available that can automate a lot of this detail
for you. Ask others in similar positions what they use.
8. Create Your Baseline Plan
Get feedback on your preliminary plan from your team and from any other
stakeholders. Adjust your timelines and work schedules to fit the project
into the available time. Make any necessary adjustments to the
preliminary plan to produce a baseline plan.
9. Request Project Adjustments
There is almost never enough time, money or talent assigned to a project.
Your job is to do more with the limited resources than people expect.
However, there are often limits placed on a project that are simply
unrealistic. You need to make your case and present it to your boss and
request these unrealistic limits be changed. Ask for the changes at the
beginning of the project. Don't wait until it's in trouble to ask for the
changes you need.
10. Work Your Plan, But Don't Die For It
Making the plan is important, but the plan can be changed. You have a
plan for driving to work every morning. If one intersection is blocked by an
accident, you change your plan and go a different way. Do the same with
your project plans. Change them as needed, but always keep the scope and
resources in mind.
11. Monitor Your Team's Progress
You will make little progress at the beginning of the project, but start then
to monitor what everyone is doing anyway. That will make it easier to
catch issues before they become problems.
12. Document Everything
Keep records. Every time you change from your baseline plan, write down
what the change was and why it was necessary. Every time a new
requirement is added to the project write down where the requirement
came from and how the timeline or budget was adjusted because of it. You
can't remember everything, so write them down so you'll be able to look
them up at the end-of-project review and learn from them.
13. Keep Everyone Informed
Keep all the project stakeholders informed of progress all along. Let them
know of your success as you complete each milestone, but also inform
them of problems as soon as they come up. Also keep you team informed.
If changes are being considered, tell the team about them as far ahead as
you can. Make sure everyone on the team is aware of what everyone else is
doing.
6

Q. No. 02
What are different pricing strategies used in various
project?

Pricing Strategies.
There are many ways to price a product. Let's have a look at some of them and try
to understand the best policy/strategy in various situations. See also e Marketing
Price.

Premium Pricing.
Use a high price where there is a uniqueness about the product or service. This
approach is used where a a substantial competitive advantage exists. Such high
prices are charge for luxuries such as Cunard Cruises, Savoy Hotel rooms, and
Concorde flights.

Penetration Pricing.
The price charged for products and services is set artificially low in order to gain
market share. Once this is achieved, the price is increased. This approach was
used by France Telecom and Sky TV.

Economy Pricing.
This is a no frills low price. The cost of marketing and manufacture are kept at a
minimum. Supermarkets often have economy brands for soups, spaghetti, etc.

Price Skimming.
Charge a high price because you have a substantial competitive advantage.
However, the advantage is not sustainable. The high price tends to attract new
competitors into the market, and the price inevitably falls due to increased
supply. Manufacturers of digital watches used a skimming approach in the 1970s.
Once other manufacturers were tempted into the market and the watches were
produced at a lower unit cost, other marketing strategies and pricing approaches
are implemented.
Premium pricing, penetration pricing, economy pricing, and price skimming are
the four main pricing policies/strategies. They form the bases for the exercise.
However there are other important approaches to pricing.

Psychological Pricing.
This approach is used when the marketer wants the consumer to respond on an
emotional, rather than rational basis. For example 'price point perspective' 99
cents not one dollar.

Product Line Pricing.


Where there is a range of product or services the pricing reflect the benefits of
parts of the range. For example car washes. Basic wash could be $2, wash and
wax $4, and the whole package $6.
7

Optional Product Pricing.


Companies will attempt to increase the amount customer spend once they start to
buy. Optional 'extras' increase the overall price of the product or service. For
example airlines will charge for optional extras such as guaranteeing a window
seat or reserving a row of seats next to each other.

Captive Product Pricing


Where products have complements, companies will charge a premium price
where the consumer is captured. For example a razor manufacturer will charge a
low price and recoup its margin (and more) from the sale of the only design of
blades which fit the razor.

Product Bundle Pricing.


Here sellers combine several products in the same package. This also serves to
move old stock. Videos and CDs are often sold using the bundle approach.

Promotional Pricing.
Pricing to promote a product is a very common application. There are many
examples of promotional pricing including approaches such as BOGOF (Buy One
Get One Free).

Geographical Pricing.
Geographical pricing is evident where there are variations in price in different
parts of the world. For example rarity value, or where shipping costs increase
price.

Value Pricing.
This approach is used where external factors such as recession or increased
competition force companies to provide 'value' products and services to retain
sales e.g. value meals at McDonalds.
One of the four major elements of the marketing mix is price. Pricing is an
important strategic issue because it is related to product positioning.
Furthermore, pricing affects other marketing mix elements such as product
features, channel decisions, and promotion.
While there is no single recipe to determine pricing, the following is a general
sequence of steps that might be followed for developing the pricing of a new
product:
Develop marketing strategy - perform marketing analysis, segmentation,
targeting, and positioning.
Make marketing mix decisions - define the product, distribution, and
promotional tactics.
Estimate the demand curve - understand how quantity demanded varies with
price.
Calculate cost - include fixed and variable costs associated with the product.
Understand environmental factors - evaluate likely competitor actions,
understand legal constraints, etc.
Set pricing objectives - for example, profit maximization, revenue maximization,
or price stabilization (status quo).
Determine pricing - using information collected in the above steps, select a
pricing method, develop the pricing structure, and define discounts.
These steps are interrelated and are not necessarily performed in the above
order. Nonetheless, the above list serves to present a starting framework.
Marketing Strategy and the Marketing Mix
Before the product is developed, the marketing strategy is formulated, including
target market selection and product positioning. There usually is a tradeoff
between product quality and price, so price is an important variable in
positioning.

Calculate Costs
If the firm has decided to launch the product, there likely is at least a basic
understanding of the costs involved, otherwise, there might be no profit to be
made. The unit cost of the product sets the lower limit of what the firm might
charge, and determines the profit margin at higher prices.
8

The total unit cost of a producing a product is composed of the variable cost of
producing each additional unit and fixed costs that are incurred regardless of the
quantity produced. The pricing policy should consider both types of costs.

Environmental Factors
Pricing must take into account the competitive and legal environment in which
the company operates. From a competitive standpoint, the firm must consider
the implications of its pricing on the pricing decisions of competitors. For
example, setting the price too low may risk a price war that may not be in the best
interest of either side. Setting the price too high may attract a large number of
competitors who want to share in the profits.

Pricing Objectives
The firm's pricing objectives must be identified in order to determine the optimal
pricing. Common objectives include the following:
Current profit maximization - seeks to maximize current profit, taking into
account revenue and costs. Current profit maximization may not be the best
objective if it results in lower long-term profits.
Current revenue maximization - seeks to maximize current revenue with no
regard to profit margins. The underlying objective often is to maximize long-term
profits by increasing market share and lowering costs.
Maximize quantity - seeks to maximize the number of units sold or the number of
customers served in order to decrease long-term costs as predicted by the
experience curve.
Maximize profit margin - attempts to maximize the unit profit margin,
recognizing that quantities will be low.
Quality leadership - use price to signal high quality in an attempt to position the
product as the quality leader.
Partial cost recovery - an organization that has other revenue sources may seek
only partial cost recovery.
Survival - in situations such as market decline and overcapacity, the goal may be
to select a price that will cover costs and permit the firm to remain in the market.
In this case, survival may take a priority over profits, so this objective is
considered temporary.
Status quo - the firm may seek price stabilization in order to avoid price wars and
maintain a moderate but stable level of profit.
For new products, the pricing objective often is either to maximize profit margin
or to maximize quantity (market share). To meet these objectives, skim pricing
and penetration pricing strategies often are employed
Skim pricing attempts to "skim the cream" off the top of the market by setting a
high price and selling to those customers who are less price sensitive. Skimming
is a strategy used to pursue the objective of profit margin maximization.
Skimming is most appropriate when:
Demand is expected to be relatively inelastic; that is, the customers are not highly
price sensitive.
Large cost savings are not expected at high volumes, or it is difficult to predict the
cost savings that would be achieved at high volume.
The company does not have the resources to finance the large capital
expenditures necessary for high volume production with initially low profit
margins.

Pricing Methods
To set the specific price level that achieves their pricing objectives, managers may
make use of several pricing methods. These methods include:
Cost-plus pricing - set the price at the production cost plus a certain profit
margin.

Target return pricing - set the price to achieve a target return-on-investment.


Value-based pricing - base the price on the effective value to the customer
relative to alternative products.
Psychological pricing - base the price on factors such as signals of product
quality, popular price points, and what the consumer perceives to be fair.
9

In addition to setting the price level, managers have the opportunity to design
innovative pricing models that better meet the needs of both the firm and its
customers. For example, software traditionally was purchased as a product in
which customers made a one-time payment and then owned a perpetual license
to the software. Many software suppliers have changed their pricing to a
subscription model in which the customer subscribes for a set period of time,
such as one year. Afterwards, the subscription must be renewed or the software
no longer will function. This model offers stability to both the supplier and the
customer since it reduces the large swings in software investment cycles.
Price Discounts
The normally quoted price to end users is known as the list price. This price
usually is discounted for distribution channel members and some end users.
There are several types of discounts, as outlined below.
Quantity discount - offered to customers who purchase in large quantities.
Cumulative quantity discount - a discount that increases as the cumulative
quantity increases. Cumulative discounts may be offered to resellers who
purchase large quantities over time but who do not wish to place large individual
orders.
Seasonal discount - based on the time that the purchase is made and designed
to reduce seasonal variation in sales. For example, the travel industry offers much
lower off-season rates. Such discounts do not have to be based on time of the
year; they also can be based on day of the week or time of the day, such as pricing
offered by long distance and wireless service providers.
Cash discount - extended to customers who pay their bill before a specified
date.
Trade discount - a functional discount offered to channel members for
performing their roles. For example, a trade discount may be offered to a small
retailer who may not purchase in quantity but nonetheless performs the
important retail function.
Promotional discount - a short-term discounted price offered to stimulate
sales.

Q. No. 03
Discuss different types of project management conflict and
suggest ways for effective management of these conflicts?
What is conflict?
Conflict may be defined as A state that exists between two people or groups
having goals or objectives that affect each other differently
A clash of ideas Conflict on a project may be characterized as
Two or more parties having differing interests, perspectives or disagreement
Requiring resolution to achieve project goals

What about managing conflict?


Conflict management may be expressed as The art of managing conflict
creatively and productively This art channels conflicts so that the result is
positive And preferably synergistic Rather than destructive
Project "disagreements" Of both a technical and personal nature
Can be managed
By appropriate managerial techniques In the interests of project achievement and
success
Project conflict On a project
People come together Often barely knowing each other
Yet are asked to work together
Under pressure of project constraints
Project conflict
Is encountered on almost all projects
And occurs at all levels
Largely because there are so many different parties working together Each with
their own aims
According to a theoretical supposition in behavioral research, when we work
together with others, we do so unselfishly in order to achieve a common
10

objective. This assumption can be best applied to project management and in


organizations.
Unfortunately, this is not how the people and organizations do it in reality.
Instead, certain conditions and workplace issues are encountered. Due to some
work discrepancies, political conflict among managers is prevalent and abuse of
power occurs. There is lack of open communication, low level of trust and
respect, and lack of mutual support. Resentment and hostility among individuals
is widespread.

Existing organizational conflicts cause problems for project managers who are
taking great efforts to generate participation and teamwork from individuals and
groups in a project organization. Unless conflicts can be resolved and dealt with
accordingly, these attempts of promoting teamwork in a project will be hard to
achieve.

Potential Sources of Conflict

There have been many researches about conflict in project management.


The top-ranking source of conflict is schedules. Scheduling is probably one of the
toughest obligations of most project managers. We might think that it is easy to
establish a schedule for the many appointments, tasks, and other work, but it is
actually the other way around. Next in the list is project priorities. Because
managers need to attend to the projects of the organization, sometimes conflict
arises when not all projects are given attention and importance.

Third on the list is manpower resources. Lack of individuals to work on a certain


project may cause pressure. When people start to feel the intensity of pressure,
they also start cramming and become less motivated to work on it. Technical
conflict and administrative procedures are part of the list, too. Finally, cost
objectives and personality conflicts complete the list of sources of conflict for this
particular study.

These sources of conflict are not the real content of the situation but the
underlying cause of such disagreement. All organizations experience some form
of disagreement over these identified sources. These disagreements become
heated arguments and thus become a conflict. But not all disagreements are
necessarily conflicts. It can be prevented from turning into a conflict if the
organization works together.

People Factor in Organizational Conflicts

A project organization either creates teamwork or conflict depending on the kind


if people involved in a project. Even if the organizational structure is solid and
develops teamwork, individual differences can still trigger conflict. In project
management, people problems can be classified into three main aspects which
are individual and group interests, personality problems, and “problem people”.

People have their personal motivations and interests even when working with a
team. When these interests differ or do not arrive at a common ground, conflicts
arise. Groups who have incompatible objectives for the organization cause
conflict. Such incompatibility may be caused by differences in culture.

Differences in personality is a common source of conflict. Individuals employ


emotions especially in conflicts. Positive emotions promote teamwork; however,
negative emotions encourage conflict. The “problem people” are examples of
those who have difficult personalities and their behavior may worsen a situation
if not managed properly. Even in management, there are managers who are also
problem people. Apart from lack of interpersonal skills, they possess ruthlessness
and lack of principles, insecurity, and poor management style.
11

Poor Interpersonal Skills

Project managers who lack good interpersonal skills or people skills are
inefficient in dealing with the organization and issues within. Such incompetence
may cause the relationships of managers with their people to be weak and
resentful. If this is the situation, conflicts are more likely to generate.

Managers who lack the ability to relate to the people also lack sensitivity and tact
in dealing with them. They are also characterized by the poor choice of words,
inability to deal with pressure, poor listening skill, and inappropriate expression
of facial and body gestures or body language.
In project management, a manager should possess strong leadership abilities
instead of appearing incompetent to the team. In order to reduce conflicts caused
by this factor, managers can join specialized training for enhancement of their
managerial attributes.

Introduction
Conflict in project management is inevitable. The potential for conflict in
information systems development projects is usually high because it involves
individuals from different backgrounds and orientations working together to
complete a complex task. The cause of conflict in team projects can be related to
differences in values, attitudes, needs, expectations, perceptions, resources, and
personalities. Proper skills in dealing with conflict can assist project managers
and other organization members to handle and effectively resolve conflicts which
can lead to a more productive organization as a whole.

Project Initiation
The first phase of the process involves performing activities to evaluate the
project size, scope, and degree of difficulty and to establish procedures for
supporting later project activities. Examples of activities at this phase are forming
a project initiation team, building the customer relationship, developing effective
management procedures, and constructing a project workbook.

Project Planning
The second phase of the process involves defining clear, distinct activities and
work required to complete the activities for each individual project. Examples of
activities at this phase are defining the project scope, defining the work
breakdown structure, estimating resource requirements, outlining
communication procedures among managers, team members, and the customer,
identifying and evaluating risk, and developing a Baseline Project Plan.

Project Execution
The third phase of the process involves implementing the plans created in the
earlier phases, Project Initiation and Project Planning. Examples of activities at
this phase are executing the baseline plan, managing changes to the baseline
plan, monitoring project progress, and communicating project status to
managers, team members, and the customer.

Project Closedown
The final phase of the process involves bringing the project to an end. Examples
of activities at this phase are evaluating team members, conducting final project
reviews, and closing the customer contract.
The project manager is responsible for carrying out the initiation, planning,
execution, and closedown phases of a project. The success of a project relies
strongly on the project manager. The role of this person is to evaluate project
feasibility and to create the plan of activities required to meet the objectives. This
individual must be able to build an environment in which the project can be
executed while protecting the environment from factors that could impede
progress, planning the work that has to be completed to reach the goal, and
keeping the course of the project in control. It is important for a project manager
to possess a diverse set of skills - management, leadership, technical, customer
relationship, and conflict management.
12

Managers spend 42% of their time on reaching agreement with others when
conflict occurs. Conflict management within a team environment requires the
ability to solve problems, set goals, compromise, settle personality differences,
and resolve conflicts. Training for project managers in this area is necessary for
their success, as they are typically responsible for handling conflict during a
project. The remainder of this paper will address conflict and its resolution in
project management.
Understanding Conflict
Conflict is "a situation of competition in which the parties are aware of the
incompatibility of potential future positions and in which each party wishes to
occupy a position which is incompatible with the wishes of the other." Conflict is
viewed as a cycle: "As with any social process, there are causes; also, there is a
core process, which has results or effects. These effects feed back to effect the
causes." To understand conflict further, the situation must include elements of
interdependence, emotions, perceptions, and behaviors. For example, conflict
occurs between parties whose tasks are interdependent, who are angry with each
other, who perceive the other party as being at fault, and whose actions cause a
business problem.
Conflict can be constructive and healthy for an organization. It can aid in
developing individuals and improving the organization by building on the
individual assets of its members. Conflict can bring about underlying issues. It
can force people to confront possible defects in a solution and choose a better
one. The understanding of real interests, goals and needs is enhanced and
ongoing communication around those issues is induced. In addition, it can
prevent premature and inappropriate resolution of conflict. Constructive conflict
occurs when people change and grow personally from the conflict, involvement of
the individuals affected by the conflict is increased, cohesiveness is formed
among team members, and a solution to the problem is found. However, if
conflict is not managed properly, it can be detrimental to an organization by
threatening organizational unity, business partnerships, team relationships, and
interpersonal connections. Deconstructive conflict occurs when a decision has
not been found and the problem remains, energy is taken away from more
important activities or issues, morale of teams or individuals is destroyed, and
groups of people or teams are polarized.
Destructive conflict has a predictable pattern known as the Drama Triangle. By
learning how to identify these unproductive roles and how to effectively handle
each role player, managers can prevent some conflicts from occurring and resolve
those that do. Most individuals know how to assume the following three roles:
Persecutor refers to a person who uses aggressive behavior against another
person, attacking the intended victim. An attack can be direct or indirect and be
physical, verbal, or both. The persecutor's actions deliver a message that "you are
not okay" while making the persecutor feel righteous and superior.
Victim refers to a person who uses nonassertive behavior so others view them as
"I'm not okay." This behavior encourages others to either rescue or persecute the
victim. Victims will feel helpless, inadequate, sad, scared, or guilty. The victim
role is often used because the individual is feeling stressed, has low self-esteem,
or is being persecuted by another.
Rescuer refers to a person who uses either nonassertive or aggressive behavior.
Individuals become rescuers because they will not say "no" and unwillingly
assume the responsibility of solving the victim's problem. In contrast, others will
assume the rescuer role to demonstrate superiority over the victim.
These roles are learned in early childhood and are used throughout adulthood.
They involve the perception of oneself or someone else as inadequate or not
acceptable. The aggressive and nonassertive behaviors that are present in these
roles lead to win-lose outcomes and do not provide an opportunity for a win-win
resolution.
It is important for a project manager to understand the dynamics of conflict
before being able to resolve it. The internal characteristics of conflict include
perception of the goal, perception of the other, view of the other's actions,
definition of problem, communication, and internal group dynamics.
Perception of the goal becomes a problem when success becomes competitive or
"doing better than the other guy." The focus is placed on the solution rather than
attaining the goal.
13

Perception of the other can create conflict when the attitude becomes "us versus
them." Similarities and differences are emphasized causing division within a
group.
View of other's actions can be a problem when the situation is competitive
instead of cooperative. Behavior can be suspicious in a competitive environment.
Definition of problem can result in conflict when the size of the problem is
escalated, issues are misconstrued, and original issues are lost.
Communication in a competitive environment can cause mistrust and
information may be withheld or may be lacking. Communication is not open and
honest.
Internal group dynamics can be negative when the group structure is centralized
and rigid rather then safe and open. Conformity is emphasized and tasks
dominate over the needs of the team members.
These characteristics can strongly influence the behavior style of group members
and affect the potential outcome of the conflict. In some instances, the project
manager's lack of skills to effectively manage and resolve conflict can be the
problem.
Approaches to Conflict Resolution
In Project Management: A Systems Approach to Planning, Scheduling, and
Controlling, five modes for conflict resolution are explained and the situations
when they are best utilized are identified. These modes are Confronting,
Compromising, Smoothing, Forcing, and Avoiding.
Confronting is also described as problem solving, integrating, collaborating or
win-win style. It involves the conflicting parties meeting face-to-face and
collaborating to reach an agreement that satisfies the concerns of both parties.
This style involves open and direct communication which should lead the way to
solving the problem. Confronting should be used when:
Both parties need to win.
You want to decrease cost.
You want create a common power base.
Skills are complementary.
Time is sufficient.
Trust is present.
Learning is the ultimate goal.
Compromising is also described as a "give and take" style. Conflicting parties
bargain to reach a mutually acceptable solution. Both parties give up something
in order to reach a decision and leave with some degree of satisfaction.
Compromising should be used when:
Both parties need to win.
You are in a deadlock.
Time is not sufficient.
You want to maintain the relationship among the involved parties.
You will get nothing if you do not compromise.
Stakes are moderate.
Smoothing is also referred to as accommodating or obliging style. In this
approach, the areas of agreement are emphasized and the areas of disagreement
are downplayed. Conflicts are not always resolved in the smoothing mode. A
party may sacrifice it's own concerns or goals in order to satisfy the concerns or
goals of the other party. Smoothing should be used when:
Goal to be reached is overarching.
You want to create obligation for a trade-off at a later time.
Stakes are low.
Liability is limited.
Any solution is adequate.
You want to be harmonious and create good will.
You would lose anyway.
You want to gain time.
Forcing is also known as competing, controlling, or dominating style. Forcing
occurs when one party goes all out to win it's position while ignoring the needs
and concerns of the other party. As the intensity of a conflict increases, the
tendency for a forced conflict is more likely. This result in a win-lose situation
where one party wins at the expense of the other party. Forcing should be used
when:
14

A "do or die" situation is present.


Stakes are high.
Important principles are at stake.
Relationship among parties is not important.
A quick decision must be made.
Avoiding is also described as withdrawal style. This approach is viewed as
postponing an issue for later or withdrawing from the situation altogether. It is
regarded as a temporary solution because the problem and conflict continue to
reoccur over and over again. Avoiding should be used when:
You can not win.
Stakes are low.
Stakes are high, but you are not prepared.
You want to gain time.
You want to maintain neutrality or reputation.
You think problem will go away.
You win by delaying.
Researchers examined the impact of the conflict resolution styles used by
individuals in shaping their work environment and affecting the level of ongoing
conflict and stress. Results of the study showed that individuals who use a certain
style to conflicts can create environments with varied degrees of conflicts.
Individuals who use more of a confronting style create an environment with
lower levels of task conflict, which reduces relationship conflict and stress.
Whereas, individuals who use more of the forcing or avoiding styles tend to
create an environment with more task conflict, which increases relationship
conflict and stress. The study suggests conflict develops not only in
environmental circumstances but in the styles used by individuals when
confronted with a conflict. The manner in which a person responds to
organizational dissension and uncertainty will influence the responses of others
and the individual's work experience.
Another study went a step further and examined the relationship between the
three forms of organizational justice (procedural, distributive, and interactional)
and the conflict resolution styles. The researchers concluded that higher
interactional justice was related to greater use of the confronting style when
distributive justice was low and procedural justice was high. Use of the avoiding
style was positively related to distributive justice. This study suggests when
employees perceive organizational justice, they are likely to use more cooperative
modes, such as confronting, smoothing, and compromising, in dealing with
conflict. Results from this study have implications for organizations. Managers at
all levels of an organization should be attentive to enhancing employee
perceptions of organizational justice in order to encourage the use of more
cooperative styles for organizational conflict management.
Barki and Hartwick tested a model of how members of information systems
development (ISD) projects perceive interpersonal conflict and examined the
relationships between interpersonal conflict, conflict management styles, and
ISD outcomes. In the study, interpersonal conflict was defined as "a phenomenon
that occurs between interdependent parties as they experience negative
emotional reactions to perceived disagreements and interference with the
attainment of their goals." The results suggest that individuals' assessments of
interpersonal conflict were formed based on disagreement, interference, and
negative emotion. Interdependence was not a factor in their assessment. Negative
emotion was found to be a significant part of an individuals' perception of
interpersonal conflict. Although conflict management styles were shown to have
positive effects on ISD outcomes, the negative effects of interpersonal conflict on
the outcomes were not alleviated. Regardless of how the conflict was managed or
resolved, the study demonstrated that the impact of interpersonal conflict was
perceived to be negative. The researchers concluded that management and
satisfactory resolution of interpersonal conflict are important. However,
prevention of interpersonal conflict should be the greater focus.
Al-Tabtabai and colleagues undermine the modes of conflict resolution and
propose a conflict resolution technique using a cognitive analysis approach. This
approach identifies a main source of conflict as the cognitive differences between
parties. Feedback is presented that gives analysis of each individual's judgment
and comparisons with the counterpart's judgment. This cognitive feedback
15

provides insight to conflicting parties and gives them an opportunity to reach an


acceptable resolution to the conflict. The proposed systematic methodology to
conflict resolution identifies and measures the cues, distal variable, and
judgments and determines the relationships between these variables. The six
steps of this methodology are listed below.
Identification of the Conflict Domain
Generation of Conflict Cases
Exercise of Judgment
Analysis of the Results
Communication of the Judgment Differences (Cognitive Feedback)
Negotiation Among Conflicting Parties
The use of the cognitive analysis approach resulted in more agreement among the
parties in conflict. Cognitive feedback provided information on reasons why the
disagreement occurred among the parties and on areas that needed to be
addressed to reach an agreement. This approach allowed the project members
involved in the conflict to concentrate on the real differences that provoked the
disagreement rather than only discussing the effects of the conflicting situation.
The findings from this study suggest the use of cognitive feedback can be
effectively applied to conflict resolution.
Active listening is a proven technique managers can use to help resolve conflict.
Developing this skill takes practice, but it can be extremely effective when
mastered. Listening allows the conflict to take its natural course by giving
individuals the opportunity to disagree, express strong opinions, and show
passion for ideas. A respect for individual differences is demonstrated and an
environment of understanding is fostered. Listening is helpful in achieving a
winning resolution by enabling an employee to identify the criteria that is
considered an acceptable outcome. When a manager is able to understand the
needs and interests of individuals, the chances of satisfactorily resolving the
conflict for both parties are increased. As a result of this process, trust and a
relationship bond will form preparing individuals to listen also to the needs of the
manager.
An awareness of the potential approaches to conflict resolution and the
understanding of their consequences can provide project managers with a
invaluable set of tools to create an optimal work environment.
Conclusion
Conflict in project management is not necessarily unfavorable when properly
managed. Several advantages have been identified such as increasing personal
growth and morale, enhancing communication, and producing better project
outcomes. However, conflict can be the decline of an organization if it is not
effectively managed. The challenge for organizational leaders and project
managers is to try to maintain the right balance and intensity of conflict in
project management. By utilizing project management principles, understanding
the dynamics of conflict, and learning approaches to conflict resolution,
managers will be able to establish an environment in which creativity and
innovation is encouraged and project goals are accomplished.

Q. No. 04
You are required to recommend a proper management cost
and control system (MCCS) encompassing a planning cycle
and an operating cycle?

Management Control Systems


A management control system is a means of gathering and using information. It
guides the behavior of managers and employees.
Financial data
Non financial data
Formal control system
Informal control system
Cost Control

Steps taken by management to assure that the cost objectives set down in the
planning stage are attained and to assure that all segments of the organization
16

function in a manner consistent with its policies. For effective cost control, most
organizations use Standard Cost Systems, in which the actual costs are compared
against standard costs for performance evaluation and the deviations are
investigated for remedial actions. Cost control is also concerned with feedback
that might change any or all of the future plans, the production method, or both.

On long term projects, phasing can be overdone, resulting in extra costs


and delays. To prevent this, many projects driven companies resort to other types
of systems, such as a management cost and control system (MCCS). No program
or project can be efficiently organized and managed without some form of
management cost and control system. The first phase constitutes the planning
cycle, and the next four phases identify the operating cycle. Following figure
shows the activities included in the planning cycle.

Planning Work Cost data Cost


authorization collation accounting
and release and
reporting

Phase I Phase II Phase III Phase IV

Customer
and
reporting

Phase V
Operating cycle

The planning cycle of a management cost and control system


Work break down structure
Work planning authorization
Master production schedule
Detailed schedule
Program plan
MCCS budget

BUDGETS:
The project budget, which is the final result of the planning cysle of the
MCCS, must be reasonable, attainable, and based on contractually negotiated
costs and the statement of work. The basis for the budget is either historical cost,
best estimates, or industrial engineering standards. The budget must identify
planned manpower, requirements, contract allocated funds, and management
reserve.
All budgets must be traceable through the budget “log.” Which includes:
Distributed budget
Management reserve
Undistributed budget
Contract changes
The distributed or normal performance budget is he time phased budget that is
released through cost accounts and work packages. Management reserve is
generally the dollar amount established for categories of unforeseen problems
and contingencies result the special out of scope work to the performers.
Sometimes, people interpret the management reserve as their own little kitty of
funds for a special purpose. Below are several interpretation on how the control
of the management reserve should be used.

The management reserve is actually excess profits and should not be used it all. It
should be booked as additional profits as soon as possible. (Accounting).
17

The management reserve should be spent on any activities that add features or
additional functionality to the product. Our customer will like that. It wills also
buildup good customer relations for future work. (Marketing)

The management reserve should be used fro those activities that add value to our
company, especially our image in the community. (senior management)

The management reserve should be use as part of risk management in


development in developing mitigation strategies for risks that occur during the
execution of the project. Scope changes not originally agreed to should be billed
separately to the customer. (project manager).

The management reserve should be used for the additional hours necessary to
show that our technical community can exceed specifications rather that merely
meeting them. This is our strength. The management reserve should also be used
as “seed money” for exploring ideas discovered while working on this project.
(Engineering and R&D)

Controlling Food Costs


Controlling food costs starts with inventory organization and control. Over and
over we have found that reducing inventory levels and organizing food storage
areas will significantly reduce food costs. It is a simple axiom: When we have
excess and disorganization we have waste.
THE BEST GUESS INVENTORY/ORDER SYSTEM
This system works best when our chef/kitchen manager has been able
convince us that ordering is a complex procedure that we the
manager/owner should not get involved in. Only someone with his/her many
years of experience can understand the obscure secrets of food purchasing. The
system works like this:
In the middle of the lunch hour rush a waitress runs out of crackers. (Side station
stocking problem?)
She rushes to the store room but does not see the crackers because two cases are
hidden under other things. (Poor organization problem?)
She then rushes to the chef, who is busy on the line, and tells him you are out of
crackers.
The chef was to busy to leave the line and check the storeroom.
That afternoon whatever salesperson walks in first will get an order for crackers.
(Forget price, we need them now!) And because we ran out the chef doubles the
order to four cases.
Now we have six cases of crackers that will sit in the storeroom for who knows
how long. (Your money is sitting on a shelf earning nothing)
Murphy's Law says it is only a matter of time until someone stacks a couple of
cases on #10 cans on top of the crackers.
Chances are good that before you can use up all those crackers, you will have one
or more cases of cracker bits and crumbs.
There we are: Inadequate side station stocking and poor food storage
organization caused a panic in the middle of the lunch rush resulting in a panic
purchase of excess inventory, without checking prices, which resulted in
overstocking and spoilage.
The really scary part is that this is standard operating procedure for many
restaurants.
HELPFUL HINT
In many instances we have eliminated 20% to 50% of the shelves and storage
areas to encourage the kitchen to keep their inventory lean and mean. In some
cases of extreme overstocking this alone has resulted in reducing food costs by
more than 10%.
A rule of thumb we have found to work well is: Order to bring your inventory up
to a two order period par level. That is: If you order an item daily, such as
produce, order enough to have a two day supply including the inventory you have
on hand. If you order dry stores weekly, subtract the inventory you have on hand
from what you expect to use over the next two weeks and order the difference.
With this simple concept you should never run out of product, and never have
more than a two order period inventory on hand.
18

FOOD STORAGE
While state Health Departments have gotten tougher in this area, many
restaurants still loose product to freezer burn, contamination and spoilage
because of improper storage procedures. Even worse are those restaurants who
loose customers because they serve less than fresh meals.
Want to know what improper storage is costing us?
On the sly, after all your employees have left, take an inventory of everything in
your freezer and walk-in that is not properly wrapped, covered or date marked.
In the next day or two take a second inventory to see how many of these items are
still not properly stored. Check for rotation to see if the oldest items are used
first.
Now cost out the items that are still improperly stored. Multiply this by 365 days.
Bet that number gets your attention.
Give your kitchen crew a break by assuming that half of those items will be used
up before they spoil. Chances are that even half of your annual spoilage cost will
get you thinking what you could do with all that extra money.
PORTION CONTROL
Advance preparation can have a critical impact on food costs. Just as you would
not stop to drain the swamp when the alligators are nipping at your butt, your
cooks will not worry about portion control when deluged with orders during a
rush.
Advance preparation and portioning not only saves food cost dollars, it also
results in a more efficient kitchen, with a more consistent product and faster
service to your customers.
Helpful Hint: A quick check of the previous weeks menu score provides a good
guide as to how much to prep for a given day and meal period.
PURVEYOR SHOPPING
Regularly scheduled requests for bids/quotes from both your current suppliers
and new suppliers can loop some more off your food costs. This is an area where
you can delegate, up to a point.
Have one or more of your employees make the calls, using the specifications from
your inventory/order form. If a new supplier offers a good price, ask for samples.
Do not let the employee change your specified supplier on the inventory/order
form without your approval.
Review the price offered and checks the quality of the sample before
changing purveyors. If you have any doubts, check their service and the
consistency of their quality with other restaurants in your area.
Have a receiving procedure that checks price, quality and quantity at your door.
One way is to post your inventory/order form on a clipboard at the back door.
The person receiving the delivery certifies that price and quantity of the delivery
matches the inventory/order form as well as checking for quality. Exceptions can
be noted on the back of the form, and signed by the delivery driver, with
management follow-up.
A double check is to have your bookkeeper check invoiced prices and quantities
against quoted prices and amount ordered quantities on the inventory/order
form.
THE LOWLY DISHWASHER
Being the lowest in the pecking order in a restaurant, the dishwasher's potential
for profit maximizing is often overlooked. More than anyone else he/she can tell
you what is coming back from your dining room. How much of your food costs
are going into the trash because of excessive portions or just because customers
do not like an entree, vegetable or condiment?
Changing a garnish, eliminating a vegetable or reducing a portion may allow you
to reduce the menu price, making you more price competitive with the same
profit.
THE BACK DOOR
The back door is where a good portion our profits can go, if you let it.
The most obvious step is to keep your back door locked. This will require you to
install a door bell outside for deliveries. In addition local fire codes may require
an emergency exit bar on the door. Be sure it includes an alarm that must be
deactivated by management or designated kitchen personnel before the door can
be opened.
19

Keep the area outside your back door clean and tidy. As much as is practical you
want to eliminate places where stolen food product can be hidden until the thief
gets off shift.
Check your garbage. It is a common trick to wrap a couple steaks up and hide
them in the out going garbage. You may also realize considerable saving in lost
linen and silverware costs by checking the garbage.
If you are designing a new kitchen, locate your freezers and walk-ins, where you
keep high cost items like meat and seafood, as far from the back door as possible.
Make it harder to sneak things out.

HOW TO MAKE IT ALL WORKABLE


Just like everything else in your restaurant, you are the key to making food cost
control work. We favor the two person spot check and prosecute method.
The Two person check:
Designate whoever has authority to open the back door to check all garbage
before the dishwasher carries it out. If the inspector does his/her job theft will be
reduced by requiring two person collusion.
The spot check:
This is where management insures the inspector is doing his/her job. This is also
where management gets their hands dirty and spot checks the garbage at
unexpected times. This clearly establishes you are committed to controlling back
door theft. It also validates that you do not ask your employees to do anything
you will not do.
The prosecution:
You may choose not to go through the hassle of calling the police and actually
prosecuting a thief. What you can do is:
If your cook/garbage inspector catches a dishwasher taking food out with the
garbage, establish that the dishwasher is actually the thief and fire him/her. After
a severe reprimand the first time, the same dishwasher caught taking food out
again is reasonable proof of his/her guilt in our minds.
If you wait outside and find stolen food in the garbage after your cook has
inspected the garbage, fire the cook.
It is very possible the cook who allows stolen food to go out the door is negligent
rather than a thief. No one likes to root through garbage. By firing this cook you
will insure that the next cook/inspector will really check the garbage.
Help your cook/inspector. Provide heavy vinyl or rubber gloves and apron for use
while inspecting the garbage.

A COUPLE TRICKS TO REDUCE BREAKAGE AND SPOILAGE


The very first step in breakfast preparation should be to set a supply of eggs out
to temper, even before the grill is turned on. Egg yokes are less likely to break if
the egg is cracked at room temperature.
If you use frozen portion cut steaks, layer the steaks in a shallow hotel pan then
cover them with clean cooking oil. With this simple procedure:
The steak's cooler shelf life will be doubled. And, you will have better tasting
steaks because the oil prevents the steaks flavorful juices from draining off.
When broiled the oil seals in the steaks flavor, without leaving any after taste.
With a longer shelf life you can keep more steaks defrosted, eliminating the need
to defrost in a microwave, or attempt to broil a frozen steak if you sell more than
expected.

Q. No. 05
Differentiate between the following:
(i) System Manager
(ii) Functional manager and Project Manager

Functional manager
• The functional manager has the responsibility to define how task will be
done and where the task will be done.(i-e the technical criteria).
20

• The functional manager has the responsibility to provide sufficient


resources to accomplish the objectives with in the project’s constraints (i-e
who will get the job done)
• The functional manager has the responsibility for the deliverable.

Project Manager

• Provide the vision


• Maintain the status quo
• Assist others to act
• Monitor and Control
• Institutionalize the way

(iii) PERT and CPM

PERT CPM
PERT is probabilistic in nature, based CMP is based on a single time estimate
on a beta distribution for each activity and is deterministic in nature.
time and a normal distribution for
expected time duration. Thus allows us
to calculate the “risk” in completing a
project.
PERT is used for R&D projects where CPM is used for construction projects
the risks in calculating time duration that are resource dependent and based
have a high variability. on accurate time estimates.
PERT is used on those projects, such as CPM is used for those projects, such as
R&D, where percent complete is almost construction, where percent complete
impossible to determine except at can be determined with reasonable
completed milestones. accuracy and customer billing can be
accomplished based on percent
complete.
three estimates are used to form a there is only one estimate of duration;
weighted average of the expected that is, CPM is a deterministic tool
completion time, based on a probability
distribution of completion times.
Therefore, PERT is considered a
probabilistic tool.
PERT is basically a tool for planning CPM allows an explicit estimate of costs
and control of time, CPM can be used in addition to time.
to control both the time and the cost of
the project

(iv) CPM and GERT


Critical Path Method (CPM)
The most common mathematical technique is the Critical Path Method (CPM).
The CPM is used to predict project duration by analyzing which sequence of
activities, or path, has the least amount of scheduling flexibility.

Once you have determined the early and late start and finish dates, you can
determine float. Float is equal to the difference between the late finish and early
finish dates, or the difference between the late start and early start dates.

The next step in the CPM is to determine the critical path (CP), which is the
longest path for the project that has little or no float. To determine the critical
path, you begin with the first activity in the network. Look at its successors,
compare the successors' float values, and select the one with zero float. This is the
second activity on the critical path.

Next, you would continue from the second activity on the critical path and
21

compare float for its successors, selecting the activity that has zero float and
including it in the critical path.

You continue this process to the final activity for a complete critical path. The
project can finish no sooner than the time it takes to complete the activities on
the critical path.

To calculate an activity's duration, you subtract the early start from the early
finish or the late start from the late finish. In example that follows, the numbers
indicate days.

• activity A - 1 day
• activity B - 2 days
• activity C - 3 days
• activity D - 2 days

Adding the total of the activity durations will give you the duration of the
critical path. In this example, the duration of the critical path would be 8 days.
Critical Path activities are, indeed, critical to a project's success. They need
management's careful attention. The order and duration of these activities are
important because any delays will result in the project going over the
anticipated completion date. In addition, project improvements are most
effective when made along the critical path.

Graphical Evaluation and Review Technique (GERT)


There is one additional mathematical analysis method that is rarely used
today because it has been proven to be less accurate than PERT and CPM.
This method is the graphical evaluation and review technique (GERT). GERT
allows for probabilistic treatment of both network logic and activity duration
estimates. GERT is mainly used on project activities that are only performed
in part, as well as those activities that may be performed more than once
(loop). The above graphic illustrates a GERT diagram with a simple loop.

For example, on a high-rise development project, the electrical outlets for


each floor may be installed as each floor is completed instead of waiting for
the completion of the entire building. Since this activity will be performed
more than once, using GERT will enable you to calculate the entire duration
of this activity.

Regardless of the type of mathematical analysis you apply to your projects, the
ultimate objective is to produce a schedule with realistic start and finish dates.

Você também pode gostar