Real-World Project
Management
Chapter 13
Characteristics of Project Management
• Unique one-time focus
– Difficulties arise from originality
• Subject to uncertainties
– Unexplained or unplanned events often arise,
affecting resources, objectives and timelines
• Multiple stakeholders
– Different interests in both the processes and
outcomes of the project
• No clear authority
– Project chain of command may conflict with the
formal structures of the participating
organizational units
Chapter 13 - Real World Project Management
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Measuring Project Success
• Stakeholders determine the degree of
success for each project undertaken
– For example, success may be measured by
savings in operating costs or revenue generated
– Complications arise when different groups of
stakeholders have different interests, values and
objectives
– Stakeholders must be identified, prioritized and
their measures of success well understood
• Process must be developed to achieve the desired
results
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2
Qualitative Methods for Achieving
Success
• The path to success lies in conservative
planning
– Establishes the opportunity to exceed
expectations
– Stakeholder expectations must be managed
• Expectations must be controlled and managed over
time
• Project managers must possess both
technical and soft skills
• Work objectives must be clearly defined in
order to decrease the possibility of scope
creep
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Qualitative Tools and Techniques for
Project Management
• Network diagramming is one of the most
versatile techniques for planning
– Graphic illustration of the activities in a project
and their relationship
• Provides a timeline, critical path, activities on the
critical path
System Development
Project
Analysis
Data
Analysis
Process
Analysis
Design
Reports
Design
Development
Database
Design
Code
Data
Entry
Chapter 13 - Real World Project Management
Code
Database
Testing and
Implementation
Code
Reports
System and
Network
Testing
Installation
and
Training
4
Choosing a Project Network
Diagramming Technique
• To commonly accepted approaches are
Activity on Node (AON) and Activity on
Arrow (AOA)
Using activity on node
(AON), nodes represent
activities and arrows show
precedence.
B
A
C
1
A
B
3
2
C
4
Using activity on arrow
(AOA), arrows are activities
and nodes are “events.”
Precedence is captured in
event relationships.
Chapter 13 - Real World Project Management
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AOA
1
A
AON
B
2
Activity
Relationships
C
3
4
B
A
A precedes B, which
precedes C.
C
(a)
1
(b)
C
3
B
4
C
2
B
1
B
A
2
3
A
C
4
1 A
B
C
2
A
B
A
C
5
B
D
D
2
1
4
C
3
3
4
B and C cannot begin
until A has been
completed.
B
(c)
(d)
A and B must be
completed before C
can be started.
A
A
C
5
Dumm
yD
6
A
C
B
D
(e)
1
A
2
B
Dummy
5
A
B
C
3
(f)
4
D
C
D
C and D cannot begin
until both A and B have
been completed.
C cannot begin until
both A and B have
been completed; D
cannot begin until C
has been completed.
B and C cannot begin
until A has been
completed; D cannot
begin until both B and
C have been
completed.
Diagramming the Systems Development
Project
A
C
E
I
Start
Finish
B
D
F
H
G
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Developing a Project Schedule
• A project network can be used to
develop a project schedule or plan
• The duration of a project is equal to the
longest path on the project network
– This is the critical path
– A project may contain more than one critical
path
• Activity slack is the amount of time a
project can be delayed before it
becomes critical
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Computing Earliest Start and Earliest
Finish Times
0 A 4
4 C 9
9 E 13
16 I 17
4
5
4
1
Start
Finish
0 B 3
3 D 8
8 F 11
13 H 16
3
5
3
3
Early Finish
8 G 12
Early Start
4
Chapter 13 - Real World Project Management
Activity Duration
9
Computing Late Start and Late Finish
Times
0
0
A
4
4
4
4
4
C
5
9
9
9
9
E
13
16
4 13
I
17
16 1 17
Start
Finish
0
1
B
3
3
3
4
4
Late Start
D
5
F
8
8
9
10 3 13
8
9
G
11
13
H
16
13 3 16
12
4 13
Chapter 13 - Real World Project Management
Late Finish
10
Probabilistic Project Management
• Treat activities as if they are common
variables and assign probabilities to
activity times to reflect the inherent
uncertainties
– Calculate an optimistic time (a),a most likely
time (m) and a pessimistic time (b)
– Probabilities for activity times are taken from
the beta distribution
– The formula for te is a weighted average of
the three time estimates in which the most
likely time (m) is weighted four times that of
either the optimistic or pessimistic times
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Analyzing Probabilities
• Assume that the duration of all activities are
independent from each other
• Activity times are random variables
• Let T = due date for the project, TE =
expected completion time for path
• T, TE and 2 can be used to calculate a zscore
– The value of z is the number of standard
deviations that the project due date is from the
expected completion time
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Making Time, Cost and Performance
Trade-Offs
• Project completion dates are generated in
isolation of management expectations and
may demonstrate no relationship to their
desires
• To meet stakeholder expectations, you may:
– Add resources
– Reduce performance specifications
– Change management expectations
– Combine the previous alternatives
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Making Time-Cost Trade-Offs
• Adding resources may add complexity and
increase project length
• Accurate estimates regarding the times and
costs involved are necessary
– Normal time (NT) = Expected activity duration
without crashing
– Normal cost (NC) = Expected activity costs
without crashing
– Crash time (CT) = Expected activity duration
with crashing
– Crash cost (CC) = Expected activity cost with
crashing
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Making Time-Cost Trade-Offs
• Costs are linear, it costs proportionally the
same to reduce an activity by one day as it
does two days
• Per period crashing cost is referred to as
“bang for the buck”
– Only crash activities that are on the critical path
– Crashing an activity on the critical path may not
reduce the project duration
– The process of crashing may cause the set of
critical paths to change
• The crashing technique for managing
projects reduces the duration by making a
trade-off between time and money
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Reducing Performance Specifications
and Other Alternatives
• Project duration can be reduced by
eliminating certain project deliverables
– Allows managers to reallocate resources
originally intended for other activities into new
activities that could reduce the project duration
without increasing costs
• Elimination of activities depends on
criticality of deliverable
• The project due date may be negotiable
• Individual alternatives are not mutually
exclusive
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