neering Project Management 418260, EPM Final Exam Revision at is a project life cycle? Use a diagram to aid your discussion. Why is the life cycle an important consideration for ject management? (5 marks) ject lifecycle is useful for managing projects. The lifecycle recognizes that projects have a limited life span and that re are predictable changes in level of effort and focus over the life of the project. There are various life cycle models d in the industry usually industry tailored, The general project life cycle consists of 4 phases; defining phase, planning se, executing phase, and delivering phase. ing stage: © Specifications of the project are defined. © Scope established © Teams formed ‘* Major responsibilities assigned nning stage © The level of effort increases © Scheduling © Budget © was © Stakeholders identified cuting stage: * Deliverable is produced * Status reports * Project control and monitoring * Changes to the project ing stage: * Delivery of product to customer * Redeployment of staff to other projects * Post-project review (assessing performance & capturing lessons learned) Alan Takach - 10825786 Deting Plnsing econ svoanie 1. Sohcion 1 Sious pore. Tracustonat 2 Sooctiasonn 2 Dots 2.changes 2 Tartrdoamnts Sten Sirevcuees —— S-Guaty S:Reoase esos “etosing DELIVERAN 5Engineering Project Management 48260 ‘What might some impacts be, at the project level, of poor strategy processes? (ICE) © Lack of goals, values © Financial loss ‘© Failure to deliver projects, no repeat business * Bad reputation for the company wy, nes Discuss the concept of Project Scope. Comment on the felevance of the work breakdown structure to this concep! ‘What kinds of information are included in a work package.,{5 marks) porated hatrible Hee pe | fp Sete pa Ay ahtaze chokiveunble, and te coun pekel 49 ehtgee | A clearly defined scope ensures that all stakeholders understand the projects outcomes’ Some ofthe key elemngits the should be included in the scope are; project objective, deliverables, milestones, technical requirements, limits an exclusions. Once the scope is completed you will need to review it with the customer so both parties are aware of th expectations. Once the scope is identified the work in the project can be divided into smaller apd smaller tasks. Thes small tasks are used to outline the project from the top till the bottom and show a clear image of what needs to be don at what time, The WBS defines all the elements of the project in a hierarchical framework and establishes the relationships to the end product. ‘Discuss the importance of defining limits and exclusions when considering the projects scope. (5 marks) Defining the project Scope sets the stage for developing a project*plan. The project scope definition is a document the will be published and used by the project owner and project participants for planning and measuring the project succe: Limits and exclusions further define the boundary of the project by stating what is not included; to ensure that th customer is aware of aspects of the project that will not be considered. Describe the major components of the strategic management process. Explain the role projects play in this process. (5 marks) 1. Review and define the organizational mission © "This is why we exist” ‘© Identify the scope of the organization © SWOT analysis J. Strengths and weaknesses (internal) ii, Opportunities and threats (external) 2. Set long-range goals and objectives ~ «By setting objectives it will allow the company to work towards a goal which helps them prosper ‘© SMART: Specific, measurable, assignable, realistic, time related 3, Analyze and formulate strategies to reach objectives © Toensure projects align with strategic goals © Project Portfolio Management 4, Implement strategies through projects © Compliance projects ~ to survive ‘© Operational projects - support current operations ‘© Strategic projects ~ support long term organizational mission ‘Alan Takach - 10825786Engineering Project Management 48260 Each company has its own business strategy that it needs to follow in order for it to prosper. Projects play a key role in the strategic plan because the project itself has to be in line with the organizations structure. Companies acquire projects that are related to their field rather than just taking any project just for the sake of it. What i time-phased estimating? When is it appropriate? (5 marks) Time-phased budgeting effectively unites the project schedule with the project budget. Without it, budget and schedule have no interconnection, and are left to float along independently. By time-phasing a project budget, you're armed with a more accurate representation of cash outflow so that appropriate project financial planning can take place. You're also much better able to monitor budget vs. actual costs as the project progresses so as to.gain better insight into potential cost overruns (or, under-runs) and other cost controls capabilities. SG as ) iscuss at least 3 major contract types. Comment on how each contract type shares risk between the parties under contract. (5 marks) 1. Lump Sum Contract — typically used for mechanical, electrical and civil work to determine the total cost of a project, it allows the financial commitment to be known (low risk to owner, high risk to contractor) 2. Schedule of Rates - usually used in civil engineering to determine the complexity of the work but not the extent of work needed to be done, The contract prices equal agreed rates multiplied by actual quantities of work performed (risk is relatively the same for both parties because no one is aware of the extent of work that needs to be done) 3. Cost Plus Contract — there are several types of cost plus contracts which are; cost plus fixed free, cost plus percentage free, and target estimate, All of these contracts determine how the contractor will be paid and it provides little incentive for efficiency and requires extensive administration (high risk to owner and low risk to contractor) papihatis the etference between critical chaos and rte! paths? x. * Critical Path © Longest path through the project network that has the least amount of slack © Based upon task dependencies © Critical Chain ‘© Longest chain of tasks that considers both task dependencies and resource dependencies (© More emphasis off resources than scheduling © fUnliimited-resources, critical chatrr=criticakpath ©The goal of critical chain is to help projects finish on time, within budget, and without cutting scope. ‘Alan Takach - 10825786How is PERT used to determine the likelihood of project completion within certain time frames? .{ PERT uses three time estimates for each activity which basically means that each activities duration can range from an optimistic time to a pessimistic time and a weighted average can be computed for each activity. i = Pessimistic —a (smallest duration, unlikely) Most Likely ~ m (middle, likely) Optimistic ~b (largest number, more than likely) By calculating the weighted average and variances for each activity, a Z value can be calculated and probability determined. i y © Critical chain scheduling requires that you schedule on the basis of 50% confidence level activity durations and that * you create your own schedule on ‘late finish’ basis. Comment, with justification, on whether or not you consider this risky. How does Critical Chain scheduling deal with this? Limit your answer to less than 150 words. (5 marks) Critical-Chain Project Management (CCPM’s solution to reducing project time overruns is to insist on people using the “true 50/50” activity time estimates (rather than estimates which have an 80 to 90 percent chance of being completed before the estimated time). No, | do not consider this risky, Although the duration of activities are reduced making them more realistic, CCPM inserts time buffers into the schedule to act as “shock absorbers" to protect the project completion date against task durations taking longer than the 50/50 estimate, There are three kinds of buffers in CCPM 1. Project buffer: A project time buffer is added to the expected project duration. 2. Feeder buffers: Buffers are added to the network where noncritical paths merge with the critical chain. These buffers protect the critical chain from being delayed, 3. Resource buffers: Inserted where scarce resources are needed for an activity. All buffers reduce the risk of the project duration being late and increase the chance of early project completion. ‘Why is scheduling resources an important task? How can resource scheduling reduce the flexibility in managing projects? (5 marks) _ - Project managers usually face resource-constrained problems, where there is not enough people and/or equipment to meet peak demand requirements. Thus, resources are scheduled to minimize project delay without exceeding the resource limit or altering the technical network relationships. Flexibility is reduced because, after leveling, slack is reduced and the amount of critical activities increases. ‘Alan Takach - 10825786Engineering Project Management 48260 Be Re What are examples of quality prevention, appraisal and failure costs. (5 marks) Prevention Costs: ‘Appreisal Costs Failure Costs Prevention costs support activities whose | Appraisal costs, which are sometimes Failure costs are incurred when a product purpose is to reduce the number of called inspection costs, are incurred to _ fails to conform to its design defects. Identify defective products before the specifications, products are shipped to customers. Examples Examples: Examples; © Quality Training * Test and inspection of incoming ‘© Disposal of defective products ‘© Technical support provided to | materials © Product recalls suppliers ‘* Maintenance of test equipment Lost sales arising from a © Audits of the effectiveness of the | * Field testing and appraisal at | reputation for poor quality quality system - customer site {>< Discuss possible reasons for reducing project duration. Discuss the options that are available for accelerating project completion. (5 marks) Some reasons why the project duration might be reduced is; Imposed duration - perhaps by a political announcement Market factors ~ delay in market release may result in profit loss or loss of market share Incentive clauses may encourage early completion Liquidated damages clauses may motivate early completion * Unforeseen delays may require compression of remainder of the project ‘Some examples on how to accelerate project completion are; outsourcing project work, scheduling overtime, dedicated core team, fast tracking, critical chain, phased handover, reduce scope, compromise quality and adding resources How is the earned value used to compare budgeted with actual expenditure? The earned value is the percent of the original budget that has been earned by actual work completed which will give us 2 realistic estimate of performance against a time-phased budget. How can stakeholders have both a positive and negative influence over the project’s success? (5 marks) ‘Stakeholders have positive influences on the project by assisting the team in completing the project successfully. They provide funds, expertise and resources to the team to assist them, because they benefit from the project. Sometimes. stakeholders have negative influences because they tend to see the negative outcomes from the project's success. Thus, they are reluctant to provide extra support or resources to the project. Sometimes various stakeholders will have conflicting objectives that need to be managed accordingly by the project manager. ‘Alan Takach - 10825786Engineering Project Management 48260 When preparing a cost estimate why is it important to know the reason the estimate is required. Give examples to support your answer. (5 marks) # So that the right amount of contingency can be put in place * Depending on the reason for an estimate, an appropriate type of estimate is selected. [Screening Feasibility Budget Tender | Project initiation, More detailed analysis Approval “Tender, control | ranking of alternatives _| of the preferred option { Definition phase Definition phase [Planning phase Planning phase | [Apportioning (assigning | Historical factoring | Factoring and material | Full material take-off, | percentages to | take-off, (eg $/m* bottom up estimate | packages}, ratio (eg concrete) | Sim? of bridge) _ | _ a ‘Accuracy | 440% - 15% [ais% [25% - Advantages | Quick, only general Quick | More accurate ‘Accurate : | design infoneeded | | | Disadvantages | Inaccurate Inaccurate, some Design infoneeded, | Detailed info needed, | design info needed —_| time consuming time consuming, | : ni | expensive For example: When preparing a cost estimate for a tender, the customer expects an accuracy of 45%, however when preparing a cost estimate for project initiation an accuracy of #40% can be expected because the scope is less clearly defined and therefore past experience is utilised. Why are accurate estimates critical to effective project management? Quality estimates are needed because in order to do the job of a project manager and to have a successful outcome, you have to know what you have to work with. Everything that is going to be put into a project, including time and money, heeds to be estimated accurately so that the PM can follow the scope of the project and have a happy customer. In order for the planning, scheduling, and controlling to be effective, you have to start out with accurate estimates. How does the culture of an organization influence the quality of estimates? ‘The organization culture can greatly affect project estimates. In some organizations, it may be encouraged to high ball estimates so that they have a lot of room to work with, while in other organizations they might low ball estimates to make numbers sound good to clients. Also, in some organizations itis strongly discouraged to feed into estimating ‘gamesmanship, Alan Takach - 10825786Engineering Project Management 48260 ‘What are the differences between bottom-up and top-down estimating approaches? Under what conditions would you prefer one over the other? ‘Accuracy ~~ Accuracy Minus 20%, Minus 10%, toplus 60% to plus 20% Method re Consensus Template eee Parametric artion WBS packages Function pont Range estimates (Learning curves 3B Top-down estimates usually are derived from someone who uses experience and/or information to determine the fates are made by top management who have little knowledge of project duration and total cost. Many times these e the processes used to complete the project. Top-Down estimates are easier to implement especially if the company has already engaged in a similar project in the past. With a top-down strategy, you can leave the budgeting to the upper managers and let the lower-level employees focus on their jobs instead of having to deal with budgeting concerns. Bottom-up estimates are estimates that are made by the work package level, by people who know the actual process of completing the project. It is said that they come up with low-cost and efficient methods. It allows the upper managers to focus on other things in relation to the company instead of having to come up with a budget for individual projects. | think that in most conditions | would prefer the bottom-up approach because that involves everyone in the company and the more people you have the better ideas you can come up with. What are the major types of costs? Which costs are controllable by the project manager? 1. Direct costs a. Labor b. Materials c. Eauishment d. Other 2. Direct project overhead costs 3. General and administrative overhead costs Direct costs can be influenced by the project manager, project team, and individuals implementing the work package. ‘Alan Takach - 10825786Engineering Project Management 48260 Chapter One: Modern Project Management 1, Define a project. What are five characteristics that help differentiate projects from other functions carried out in the daily operations of the organization? A project is a temporary endeavor undertaken to create a unique product, service, or result. The major characteristics of a project are as follows: ‘© Anestablished objective ‘© Adefined life span with a beginning and an end. ‘© Usually, the involvement of several departments and professionals ‘© Typically, doing something that has never been done before. ‘© Specific time, cost, and performance requirements. XY 2\\ What are some of the key environmental forces that have changed the way projects are managed? What has been the effect of these forces on the management of projects? ‘Some environmental forces that have changed the way we manage projects are: * The product life cycle * Knowledge growth * Global competition + Organization downsizing * Technology changes * Time-to-market The impact of these forces is more projects per organization, project teams responsible for implementing projects, accountability, changing organization structures, need for rapid completion of projects, linking projects to organization strategy and customers, prioritizing projects to conserve organization resources, alliances with external organizations, ete, 3. Whyis the implementation of projects important to strategic planning and the project manager? Strategic plans are implemented primarily through projects—e.g., @ new product, a new information system, a new plant for a new product. The project manager is the key person responsible for completing the project on time, on budget, and within specifications so the project’s customer is satisfied. If the project is not linked to the strategic plan of the organization, resources devoted to the project are wasted and a customer need Is not met. This lack of cohnectivity otcurs more in practice than host would Believe, 4, The technical and sociocultural dimensions of project management are two sides to the same coin. Explain. The system and fociocultural dimensions of project management are two sides of the same coin because successful project managers are skillful in both areas. The point is successful project managers heed to be very comfortable and skilful in both areas. ‘Alan Takach - 10825786Engineering Project Management 48260 5. What is meant by an integrative approach to project management? Why is this approach important in today's environment? ‘An integrative approach to project management is one in which all the parts are interrelated. This approach is important because it can give an organization a competitive edge in today’s environment. An integrative approach includes two parts. First, projects must have a strong link to the organization’s strategic plan, which is directed toward meeting the customer's needs. A project priority system reinforces this linkage by prioritizing projects according to their contribution to the strategic plan and allocates resources by the priorities set. Second, an integrative approach provides an integrated system for the actual implementation of the projects. This includes an information system which supports decision making and a sociocultural environment which creates a positive, active contribution from team members responsible for completing the project. ‘Alan Takach - 10825786Engineering Project Management 48260 Chapter Two: Organizational Strategy and Project Selection 5G72._ Describe the major components ofthe strategie management process. The strategic management process involves assessing what we are, what we want to become, and how we are going to get there, The major generic components of the process include the following: Defining the mission of the organization Analysis of the external and internal environments Setting objectives Formulating strategies to reach objectives Implementing strategies through projects. aa Explain the role projects play in the strategic management process. Strategy is implemented primarily through projects. Successful implementation of projects means reaching the goals of the organization and thus meeting the needs of its customers. Projects that do not contribute to the strategic plan waste critical organization resources. 3. How are projects linked to the strategic plan? Projects are linked to the strategic plan because projects represent how a strategy is to be implemented. Since some projects are more important than others, the best way to maximize the organization's scarce resources is through a priority scheme which allocates resources to a portfolio of projects which balance risk and contribute the most to the strategic plan. ‘The portfolio of projects is typically represented by compliance, strategic, and operations projects. What Impact can this classification have on project selection? By carefully aligning your project proposal with one classification, you may increase the chances of it being selected. Remember, senior management typically allots budgets for each category independent of actual project selection. Knowledge of funds available, risk portfolio, senior management bias, etc. may cause some to attempt to move their project proposal to a different classification to improve the chances of the project being selected. 5. Why does the priority system described in this chapter require that it be open and published? Does the process encourage bottom-up initiation of projects? Does it discourage some projects? Why? ‘An open, published priority system ensures projects are selected on the basis of their contribution to the organization. If the priority system is not open, squeaky wheels, strong people, and key departments all get their projects selected for the wrong reasons. Bottom-up is encouraged because every organization member can self evaluate their project idea against priorities - and so can everyone else in the organization. To some, this approach may look intimidating but rarely is in practice; however, it does discourage projects that clearly will not make positive, significant contributions to +e araanization vision. tization not rely only on ROI to select projects? ‘Alan Takach - 10825786Engineering Project Mahagement 48260 Financial criteria, ike (OF gone, will not ensure that selected projects contribute to the mission and strategy of a firm. Other considerations such as developing new technology, public image, brand loyalty, ethical position, and maintaining core competencies should be considered. Furthermore, it is difficult or next to impossible to assess RO! for many important projects (e.g., Y2K projects). While ROI is likely to be a key consideration for many organizations, multiple screening criteria are recommended for selecting and prioritizing projects. Discuss the pros and cons of the checklist versus the weighted factor method of selecting projects. Checklist Model + Flexible + Applies over a wide range of different types of projects, divisions, and locations + Impossible to rigorously compare and rank project by priority + Politics, power, and manipulation of project selection is very po: Weighted Factor Model © Allows comparison and ranking of potential projects © Open system * Allows for self evaluation of proposed project ‘* Power and politic games are exposed. Alan Takach - 10825786Engineering Project Management 48260 Chapter 3 Organization: Structure and Culture XA What are the relative advantages and disadvantages of the functional, matrix, and dedicated team approached to managing projects? organizational form In Which a horizontal project management structure Is “overlaid” on the normal functional ierarchy.) Strong Project Focus A formally designated project manager Is responsible for coordinating and integrating contributions of afferent units, Easier Post-Project Transition - Specialists ‘maintain tes with thelr functional group, so they have a homepart to return to once the project Is complete. Flexible ~ Flexibility In use of resources Structure ‘Advantages Disadvantages Functional + Projects are completed within the basic functional + tack of Project focus = Sometimes structure of the parent organization. There is no responsibilities get pushed aside to meet | change in the design and operation of the primary obligations. organization. + Poor cross functional integration ~ functional | © Maximum flexibility In the use of staff for specialists tend to be concerned only with ‘example, specialists within the organization can be their segment of the project and not what is temporarily assigned to work on the project best for the total project. + Indepth expertise can be used on specific ‘+ Slow ~ decisions have to be circulated through | ‘segments of the project normal management channels. ‘+ Easy Post-Project Transition ~ No redeployment + Lack of project ownership ~ Motivation may issues bbe weak ‘Matrix Efficient — Resources can be shared across ‘Dysfunctional Conflict - Tension between ‘multiple projects functional managers and project managers @ hybrid ‘who bring critical expertise and perspectives to the project, Infighting ~ Conflict and competition for scarce stressful — Stressful because project participants have at least two bosses ~ their functional head and one or more project Slow ~ Decision-making Dedicated Project |» Simple ~ Project team operates Independentiy | + Expensive Team Within a functional organization | | + Internat strife - oisegreement emeraes + FastStaff devote fl atention to the profect and between the project team and parent are not distracted by other duties. Adaltionally, organization decisions are made within the team Instead of | being deferred to senior management + Limited Technological Expertise | | © Cohesive: High evel of motivation/ Common goal + bifficult Post-Project Transition ‘+ cross-Funetional integration oe ‘Alan Takach - 10825786Engineering Project Management 48260 ‘What distinguishes a weak matrix from a strong matrix? ‘The most distinguishing characteristic between a functional and project matrix is the relative influence the project ‘manager has over project participants and functional managers. In a functional matrix the project manager role is limited to coordinating project activities. The functional managers are responsible for managing their segment of the Project. The project manager has little formal authority over the project. In a project matrix, the project manager controls most aspects of the project including design trade-offs and assignment of project personnel, The functional managers are responsible for supporting project completion. A project manager in the functional matrixis not likely to be involved in performance appraisals and compensation decisions while project managers in a project matrix would. ‘3B, Under what conditions would it be advisable to use 1g matrix instead of a dedi fed project team? Both structures can be quite effective. The project Matrix would be recommended when the organization can afford to have people work full-time on the project and when the culture of the organization supports the dual authority structure, Dedicated project teams are recommended when speed is essential to success and there is not enough project work to warrant a formal matrix structure. Dedicated project teams are also recommended when the prevalent culture within the organization does not support collaboration and innovation. 4. How can project management offices (POs) support effective project management? ‘The project office (PO) is the unit responsible for the continued support of consistent application of selection criteria, standards, and processes; training of and general assistance to project managers; and continued improvement and use of best practices. The project office frequently includes project portfolio management. Project portfolios and project offices both result in an integration function for planning and control, The PO also supports the integration of the processes of managing projects within the social/cuttural environment of the organization”, 5. Whyis it important to assess the culture of an organization before deciding what project management structure should be used to complete a project? The culture of the organization can impact the effectiveness of different project management structures. Organisational cultures that do not encourage teamwork, collaboration, and cross-functional integration need a stronger project management structure (ie. Project team, project matrix) to be successful. Conversely, a functional matrix can be effective in an organization in which the culture of the organization is conducive to project management. 6. Other than culture, what other organizational factors should be used to determine which project management structure should be used? ‘Size of project ~ Strategic importance ~ * Novelty and need for innovation * Need for integration (number of departments involved) ‘+ Environmental complexity (number of external interfaces) \— © Budget and time constraints — + Stability of resource requirements ‘Alan Takach - 10825786Engineering Project Management 48260 7, What do you believe is more important for successfully completing a project ~ the formal project management structure or the culture of the parent organization? Both are important and an argument can be made for either structure or culture. The bias of the authors is that culture is more important than structure since it more directly impacts behaviour. A positive organisational culture can compensate for the inherent weaknesses of the formal structure, For example a functional matrix can be effective if the norms and customs of the organization value teamwork and effective problem solving. Conversely, a functional matrix is likely to be disastrous in a negative culture that encourages competition and looking out only for yourself. Alternatively, one could argue that an organization can circumvent a negative culture by creating an independent project team or a strong project matrix. In ether case, the strategy isto insulate the project team from the dominant organisational culture and create a unique project subculture. ‘Alan Takach - 10825786Engineering Project Management 48260 Chapter Four: Defining the Project 1. What are the six elements of a typical scope statement? The six elements of a typical scope statement are: Project objective Deliverables Milestones Technical Requirements Limits and exclusions Reviews with customers 2, What questions does a project objective answer? What would be an example of a good project objective? ‘The questions a project objective answers are the what, when, and how much. A good example of this would be to develop a program that automatically translates English to Spanish, finished within 2 years, and not cost more than $15,000.00, 3. What does it mean if the priorities of a project include: Time-constrain, Scope-accept, and Cost-enhance? ‘Time-constrain means that time is a fixed parameter; scope-accept means itis tolerable to reduce the scope; cost- enhance means that cost should be optimized. With these project priorities, the project must meet the completion date but scope can be reduced to reduce costs. 42, What kinds of information are included a work package? Overall each work package: a. Defines work b. Identifies time to complete a work package Identifies a time-phased budget to complete a work package Identifies resources needed to complete a work package Identifies a single person responsible for units of work Identifies monitoring points for measuring progress 5, When would it be appropriate to create a responsibility matrix rather than a full-blown WBS? Tt would be appropriate to use for small projects. Many times, the size and scope of the project do not warrant an elaborate WBS or OBS. 6. How does a communication plan benefit management of projects? ‘The benefit of a communication plan is that it expresses what, who, how, and when information will be transmitted to project stakeholders so schedules, issues, and action items can be tracked. ‘Alan Takach - 10825786Engineering Project Management 48260 Chapter Five: Estimating Project Times and Costs “St, How does the WBS differ from the project network? ‘* The WBSis hierarchical while the project network is sequential. * The network provides a project schedule by identifying sequential dependencies and timing of project activities. ‘The network sets all project work, resource needs, and budgets into a sequential time frame; the W8S does not provide this information. © The WBS is used to identify each project deliverable and the organization unit responsible for its accomplishment within budget and within a time duration * The WBS provides a framework for tracking costs to deliverables and organization units responsible. ‘The WBS differs from the project network because the project network is a tool used for planning, scheduling, and monitoring project progress. It is developed from the information collected for the WBS and is a graphic flow chart of the project job plan. ‘The network is the framework for the project information system that will be {sued by the project managers to make decisions concerning project time, cost, and performance. wrest 2. How are WBS and project networks linked? | was and project networks are linked because project networks are developed from the WBS. Work packages from the WBS are used to build the activities found in the project network. Integration of the WBS and project network is crucial | to effective project management. The project manager must be careful to guarantee continuity by having same people | who defined the WBS and work packages developed the network activities. \ 3. Why bother creating a WBS? Why not go straight to a project network and forget the WBS? You should create a WBS because they are used to build the activies in the project network. An activity can include one or more work packages. ‘The activities are placed in a sequence that provides for orderly completion of the project. Networks are built using nodes and arrows. ‘The nodes depicts an activity and the arrow shows dependeney and project flow. becasese if 120 bron oy bar wth Cictnuitin can b¢ deloreed 4 wend 0.3 vitlhout dologi-g Yoo fury eck 4. Why is slack important to the project manager? a Sach, t, troporkard #0 Jno) ct Slack is important to the project manager because it represents the degree of flexibility the project manager will have in rearranging work and resources. A project network with several near cr | paths and hence, little slack, gives the project manager litle flexibility in changing resources or rearranging work. 5. What is the difference between free slack and total slack? Free slack usually occurs at the end of an activity chain—before a merge activity. It is the amount of time the activity can be delayed without affecting the early start of the activity immediately following it. Since free slack can be delayed without delaying following activities, it gives some resource flexibility to the project manager, Total slack is the amount of time an activity can be delayed before it becomes critical. Use of total slack prevents its use on a following activity ‘Alan Takach - 10825786Engineering Project Management 48260 6. Why are lags used in developing project networks? PD Gag 4" AA rrinircteny Groat ef ties ‘Two major reasons: rust he cLaloted oy bap, 697 enyd!? a hoferdep tachi ly . ere errr ee cia projects * To allow Work to bé-accomplished in parallel whea the finish-to-start relationship is too restrictive. 7. What is a hammock activity, and when is it used? A hammock activity is a special purpose activity that exists over a segment of the life of the project. A hammock activity typically uses resources and is handled as an overhead cost—e.g,, inspection. Hammock activities are used to identify overhead resources or costs tied directly to the project, The hammock duration is determined by the beginning of the first of a string of activities and the ending of the last activity in the string. Hammock activities are also used to aggregate sections of projects to avoid project detail—e.g,, covering a whole subnetwork within a project. This approach gives top management an overview of the project by avoiding detail. G Teve WHO peasons {1 F avoid datloy, ard necluce network details wifey activities 6 tog duration doloy Ale hurt on Seow ob Mactry AADA TS 2. 75 orvnacn He rat Ard bersk fan adia'ty , ‘Alan Takach - 10825786Engineering Project Management 48260 Chapter 7: Managing Risk 1. Project risks can/cannot be eliminated if the project is carefully planned. Explain. Project risks cannot be eliminated. It is impossible to be aware of all things that might happen when a project is being plemented. Undesirable events identified before the project begins can be transferred, retained/reduced, or shared. Contingency plans with trigger points and responsibility should be established before the project begins. 2. The chances of risk events occurring and their respective costs increasing change over the project life cycle. What is the significance of this phenomenon to a project manager? The chances of risk events and estimated costs changing over the project life cycle are high. These events will impact project change control mechanisms. Moreover, such changes could be significant enough to require changes in scope. The project manager must ensure that these changes are recorded and kept updated. Otherwise the integrity of the project control system will quickly deteriorate and become useless as a management tool. 3. What is the difference between avoiding a risk and accepting a risk? Avoiding a risk is changing the project plan in advance so as to eliminate specific risks from occurring while accepting a risk means no preventive action is taken; contingency plans may be used if the risk materializes. 4. What is the difference between mitigating a risk and contingency planning? Mitigating a risk refers to taking action to either reduce the likelihood that a risk (bad event) will happen and/or reduce the impact the risk has on the project. Contingency planning is developing a response if the risk occurs. Mitigating is preventive while contingency is reactive. 5. Explain the difference between budget reserves and management reserves. Budget reserves are established to cover identified risks that occur while implementing a project work package or activity, If the risk does not materialize, the funds are removed from the budget reserve, The management reserve covers unforeseen risks and applies to the total project. These reserves are usually controlled by top management, the ‘owner, and/or the project manager. Budget and management reserves are independent of each other. How are the work breakdown structure and change control connected? ‘The WBS and change control are directly linked. Any change from the baseline developed from the WBS needs to be recorded. This link allows management to trace changes and problems directly to deliverables and the organization unit, responsible. 7. What are the likely outcomes if a change control process is not used? Why? Ifa change control process is not used, budgets and plans will self-destruct quickly. Tracking changes facilitates control and accountability of budgets and time. In addition, change control allows for coordination of changes further on in the project. ; = ‘Alan Takach - 10825786Engineering Project Management 48260 8 What are the major differences between managing negative risks versus positive risks (opportunities)? Essentially the same process that is used to manage negative risks is applied to positive risks. Opportunities are identified, assessed in terms of likelihood and impact, responses are determined, and even contingency plans and funds can be established to take advantage of the opportunity if it occurs. The major exception between managing negative risks and opportunity is in the responses. The project management profession has identified four different types of response to an opportunity: © Exploit © Share ‘© Enhance © Accept Chapter 8: Scheduling Resources and Costs 1, How does resource scheduling tie to project priority? Resource scheduling ties to project priority because resources are limited. Remember, the priority system ranks projects which then determines which project each resource should work on first. How does resource scheduling reduce flexibility in managing projects? Resource scheduling systems usually reduce flexibility because when resources are considered, computer routines use slack to get an “efficient” schedule. When slack is used up, flexibility is lost and the risk of delaying the project increases, ‘occurs on the critical path, the project is delayed. If the resource cont 3. Present six reasons scheduling resources is an important task. Several reasons for scheduling resources are to: ‘+ Check if existing resources are adequate and available Decide which resources have priority ‘Assess the impact if another project is added to the pool Determine where the real critical path is, Are there unforeseen dependencies? See what happens to the risk of being late if slack is used up developing a schedule Decide if outside contractors have to be used Decide if an imposed project duration is realistic. Students should not be limited to these reasons; there are many more reasons for scheduling resources. 4. How can outsourcing project work alleviate the three most common problems associated with multiproject resource scheduling? Outsourcing can be used to reduce project slippage, improve utilization of critical resources, and avoid resource bottlenecks. For example, project delays can be avoided by contracting key activities when resources are not available internally. Likewise, hiring consultants to help with Y2K problems allows critical IT people to work on specific problems, while the outsiders work on standard programs. Not only does the project get done on time, but the company avoids hiring IT personnel to meet a short term need. ‘Alan Takach - 10825786Engineering Project Management 48260 5. Explain the risks associated with leveling resources, compressing or crashing projects, and imposed durations or “catch-up” as the project is being implemented. The risks associated with leveling, crashing, and “catch-up” are similar to those noted in question 2. Flexibility is decreased and risk of delay is increased, For example, slack is used up and may cause other bottlenecks later in a sequence of activities, Having time buffers at merge points before the project begins could help avoid some of the need to crash activities. Decoupling critical activities can help to cut time if decoupling is possible and resources can be shifted; however, the risk is typically reduced only slightly. 6. Whysit critical to develop a time-phased baseline? Other systems do not measure how much work is accomplished for the money spent! Hence, without time-phasing cost to match your project schedule, itis impossible to have reliable information for control purposes. ‘Alan Takach - 10825786Engineering Project Management 48260 Chapter Nine: Reducing Project Duration 1, What are five common reasons for crashing a project? Reasons given could include: Imposed deadline in which disfavor will be earned by not meeting superior’s deadline Time to market competitive advantage Realize benefits from incentive contracts To make up for lost time and avoid contract penalties Save extensive overhead costs Free up resources to work on other projects ‘+ Exceed customer expectations. 2. What are the advantages and disadvantages of reducing project scope to accelerate a project? What can be done to reduce the disadvantages? Reducing the scope of the project can lead to big savings both in time and costs. It typically means the elimination of certain tasks. At the same time scaling down the scope may reduce the value of the project such that it is no longer worthwhile or fails to meet critical success parameters. The key is reassessing the project requirements to determine which are essential and which are optional. This requires the active involvement of all key stakeholders. More intense re-examination of requirements may actually improve the value of the project by getting it done more quickly and for a lower cost. 3. why is scheduling overtime a popular choice for getting projects back on schedule? What are the potential problems for relying on this option? Scheduling overtime is popular because if it involves salary workers and no direct costs are added to the project. Even if it involves additional costs, you avoid Brook's law and minimize additional coordination and training costs. The disadvantages are the additional time and half costs associated with hourly overtime and stress and fatigue that come with working long hours which can lead to accidents, inferior performance, and turnover. 4, Identity four indirect costs you might find on a moderately complex project. Why are these costs classified as indirect? Indirect (overhead) costs are costs that cannot be attributed to a specific activity or work package. Examples of indirect costs are supervision, consultants, debt interest charges, machinery common to several activities, accounting and information processing, public relations, penalties or incentives for early or late completion. In practice it is amazing how many project compression decisions are made without serious consideration of indirect costs. 5. How can a cost-duration graph be used by the project manager? Explain. A cost-duration graph is useful to the project manager for comparing alternatives. Any alternative that moves the project duration away from the optimum cost-duration point will increase costs. Additionally, incentives and penalties can be evaluated against the total, low cost point. ‘Alan Takach - 10825786Engineering Project Management 48260 6. Reducing the project duration increases the risk of being late. Explai Compressing the project duration means slack (float) on noncritical activities will be reduced. When slack of noncritical activities is reduced, the chance of new critical paths occurring increases; hence, the risk of the project becoming late increases. In addition, compressing will have the following other impacts on managing the project: © Reduces flexibility by using slack ‘© Can increase number of critical activities © Can increase interdependencies of paths ‘© Makes resource scheduling tighter (critical) ‘© May increase costs. 7. Itis possible to shorten the critical path and save money. Explain how. The only way to shorten the etical path and save more is to have indirect costs whith are greater than the addtional direct costs of shortening the critical path one unit of time. The difference is a savings. Coby actlert/ on Cittet path an Barwrelbore Pde , adding a Pounce, owords Le. Ths Rell shorten # Aire apd aA ty Ls braksta be ib cont Pot & cot of added pesounce, (07 or anf ive ‘ 7 of amie) Ly boy tan ¢ md o tiere dated » Citegby ; ) , ‘ war ads be cined But Corn should be tober wid Crashing es Od ee av ¢ @ ratty reams another & han — init / / . Oren Alan Takach - 10825786Engineering Project Management 48260 Chapter 13 Progress and Performance Measurement and Evaluation 1. How does a Tracking Gantt chart help communicate project progress? A Tracking Gantt chart helps communicate project progress because it shows the actual time to complete projects relative to the baseline duration in an easy-to-understand visual format. Adding actual and revised time estimates to overview of project status on the report date. When used with a network, Gantt charts also the chart gives aq) show dependencies that are easily identified if tracing is needed. 2. How does earned value give a clearer picture of project schedule and cost status than a simple plan versus actual __ system? —_ --_ is / Earned value measures what work was accomplished for the money spent. It gives a clearer picture of project schedule and cost status than a simple plan versus actual system because the earned value system includes the time variable in (measuring press. The plan versus etal tem has the potential toledo fase conions. NN 3. Schedule variance (SV) is in dollars and does not directly represent time. Why is it still useful? Although schedule variance is in dollars and does not directly represent time, itis still very useful in assessing the direction all the work in the project is taking after 20 or more percent of the project has been completed, 4, How would a project manager use the CPI? The cost performance index (CPI) is the ratio of earned value to actual cost. It would be used by a project manager to measure the cost efficiency of the work accomplished to date. The CPl represents the value of work planned to date that has been completed for each dollar actually spent. A CPI of 1.00 indicates progress is as planned while an index greater than 1.00 shows progress is better than expected “5, What are the differences between BAC and EAC? BACs the budgeted cost at completion and is total budgeted cost of the baseline or project cost accounts. EAC is the estimated cost at completion and represents the estimate of what the final cost of the project will be based on work to date. {G. Whyis it important for project managers to resist changes to the project baseline? Under what conditions would a project manager make changes to a baseline? When would a project manager not allow changes to a baseline? Itis important for project managers to resist changes to the project baseline because changes can undermine the baseline’s effectiveness as a mechanism for monitoring project progress and tracing back delays and problems . Changes to the baseline should only be made ifit is clear the project will fail without the change, if the project will be significantly improved by the change, or if the customer wants the change and will pay for it. “The effect of the change con the scope and baseline should be accepted and signed off by the project customer” (p. 443). Changes to the baseline should not be made in order to disguise poor performance on past of current work, a practice known as “rubber baseline,” or after a work package or cost account is complete. Alan Takach - 10825786Engineering Project Management 48260 Exam Hints: Project Portfolio Management: Project Portfolio Management (PPM) is an integrated method of effectively managing multiple projects to satisfy strategic business goals and objectives (Laslo 2009}. PPM is focused on analysing risks, resources, returns, and complexity across all projects and prioritising and selecting projects so that they align with the overall strategic direction of the company (Petit 2011). In today’s competitive business environment PPM is increasingly gaining prominence as companies are challenged with the many issues that arise from simultaneously managing multiple sets of projects, such as competing priorities, resources, deadlines and predicted benefits (Unger et al. 2012). PPM is important as it an effective means of managing such issues to ensure companies select the right projects to remain agile, avoid futile investments and meet their overall strategic goals (Laslo 2009). Control Cycle (closed loop): '* Control is using the information collected during the monitoring process to © Evaluate the project’s performance ‘© Determine if corrective action is required © Take appropriate action ‘* Areas of Control in a Project © Time © Budget © Risk © Quality ~ technical compliance © Scope © Organization ~ responsibility © Attitudes ~ internal and external © Cohesiveness and cooperation of team members Alan Takach - 10825786Engineering Project Management 48260 Critical Chain: * More emphasis on resources than scheduling, ‘* Determined by technical and resource dependencies ‘© Ifunlimited resources, critical chain = critical path Critical Path = Longest path through the project that has the least amount of slack Critical Chain = Longest chain of tasks that considers task dependencies and resource dependencies Creating a Critical Chain Schedule: Identify the critical chain Exploit the critical chain to identify any re-sequencing that can shorten the duration Add the Project Buffer to the end of the critical chain ‘Add Feeding Buffers to all non-critical chains that feed the critical chain Resolve new resource contentions Traditional approach to project management: © Focus on upfront planning * Plan, execute, control and therefore a high probability of success + High degree of predictability needed ‘+ Scope and technology known Project Uncertainty: Unknown Project s20p8 (winaty Predictable roan Tey ion (How) os ‘able Agile and lean have developed to cater for industries were things are not know and predictable. Agile + Scope isnot fully known Relies on incremental, iterative development cycles to complete less-predictable projects Alan Takach - 10825786Engineering Project Management 48260 Ideal for exploratory project which requirements need to be discovered and new technology tested Emphasis on functionality not design Encourage change Advantages © Good for breakthrough technology © Continuous integration, verification and validation of the evolving product (© Frequent demonstration of progress © Early detection of defects and problems Disadvantages (© Does not satisfy top management's need for budget, scope and schedule ‘© Self-organization and close collaboration can be incompatible with corporate cultures © Only small projects with small teams (© Active customer involvement and cooperation Cost of Project Planning Agile Integration Management Cost of Project Change Agile Project Management ‘Alan Takach - 10825786Engineering Project Management 48260 Design up front | ontinuous design Fixed scope + Flexible Deliverables + Features/requirements Freeze design as early as possible Low uncertainty Avoid change Low customer interaction Conventional project teams Lean aj Traditional Ai ‘© Freeze design as late as possible © High uncertainty © Embrace change © High customer interaction Self-organized project teams proaches help us to do more with the same amount of resources to produce outcomes of superior quality. Move from concept to cash quickly ~ production based All about doing things efficiently ° ° Waste reduction Production cost reduction Manufacturing cycle times decreased Labor reduction while maintaining or increasing throughput le increasing customer service levels Inventory reduction wl ‘Alan Takach - 10825786Engineering Project Management 48260 4 ‘MMI vs OPM3 Capability Maturity Mode! integration (CMMI) was developed by the Software Engineering Institute (SE!) as a maturity model to improve the quality of software processes (Agrawal et al. 2009), while Organisational Project Management Maturity Model (OPM3) is the maturity model for improving organisational project management proposed by Project, Management Institute (PMI) (Akhta et. al 2010) Ina study of maturity models, Khoshgoftar and Osman (2009) provide an in-depth comparison of the CMMI and OPM3 frameworks which revealed the following notable differences: TTEM OF COMPARISON cm OPM Scopes \Gonware y ¢ | Project Management | Maturity Level Staged (5) Continuous Details (The amount of High Extremely High | considered factors) Extent of bifcuties [High —SC~C~<“~i~twSCSSSSCSCS~ Pon anagem Eee cove PTT (Re - | Management recess) Process > ‘Assessment Cost 7 Medium low Training Difficulty High —_ Low - ‘Simple and Understandable Medium Yes a (> ‘Alan Takach - 10825786