CAPM Prep Presentation

7/23/2019 CAPM Prep Presentation

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Importance of Project Management

Projects represent change and allow organizations toeffectively introduce new products, new

process, new programs

Projects are becoming globalized making them moredifficult to manage without a formal methodology

Project management helps cross-functional teams tobe more effective


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HISTORY OF PROJECTMANAGEMENT

n Was developed from different disciplinesengineering, construction, management

n Forefather of project management is Henry

Ganttn 1950s mared the !eginning of project

managementn

19"9 #as the development of the projectmanagement institute


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Management of Projects

More than $!" billion is spent in the # each year onappro%imately &'!,""" information technology projects(

)nly * percent of these projects are completed on time andwithin budget(

+he average cost for a development project for a large companyis more than $ million(

Project management is an $!" million industry and is e%pected

to grow by as much as " percent per year(ounds, .ene( /+he 0ast 1ord on Project

Management2IIE Solutions, 3ovember, &44(


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PROJECTS VS OPERATIONS

$rojects %perations

temporary ongoing

&ni'ue ( )pecific *ot uni'ue

+uilding a house in threemonths

)elling soft#are


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Delayed Openings are a Fact of Life in the Foodservice,

Hospitality Industry

Disney's shipbuilder was six months late in delivering its new cruise ships,and thousands of customers who had purchased tickets were stranded.

Even with that experience, their second ship was also delivered well after

the published schedules. Universal Studios in Orlando, Fla. had been

building a new restaurant and entertainment complex for more than two

years. They advertised a December opening, only to announce in late

November that it would be two or three months late.

Even when facilities do open close to schedule, they are rarely finished

completely and are often missing key components. Why do those things

happen? With all of the sophisticated computers and project management

software, why aren't projects completed on schedule?

Frable, F. Nation's Restaurant News(April 12, 1999)


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!" #o Projects Fa$%&

St'#$es !a(e s!o)n t!at t!e fo%%o)$ng factorscontr$*'te s$gn$f$cant%" to project fa$%'re+

5mproper focus of the project management system

1rong level of detail

0ack of understanding about project management tools6 too much

reliance on project management software

+oo many people

Poor communication

7ewarding the wrong actions


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!" #o Projects Fa$%&

, I%%-#ef$ne# or c!ang$ng re.'$rements

, Poor project p%ann$ng/management

, 0ncontro%%e# .'a%$t" pro*%ems

, 0nrea%$st$c e1pectat$ons/$nacc'rate est$mates

, Na$(e a#opt$on of ne) tec!no%og"

ource8 ( Mc9onnell, 9onstru% oftware uilders, 5nc(


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Not a%% Projects Are A%$2e3

/:in 5+ projects;, if you ask people what


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Project 4$fe C"c%e

T$meP!ase 5 P!ase 6 P!ase 7 P!ase 8>ormation ? Planning cheduling ? @valuation ?election 9ontrol +ermination

Re.'$re#Reso'r

ces


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9es$gn: Cost: T$me Tra#e-offs

Target

COST

9ESIGN

TIME;SCH

E904

Eor each task j, we must make three estimates8

most optimistic time

most pessimistic time

most likely time

Est$mat$ng Tas2 9'rat$ons+ Pa$nt$ng a RoomTas28 Paint I rooms each is appro%imately &"< % "< #se flat paint on walls


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Tas28 Paint I rooms, each is appro%imately &" % " ( #se flat paint on walls,

semi-gloss paint on trim and woodwork( @ach room has two doors and four

windows( Nou must apply masking tape before painting woodwork around the

doors and windows( Preparation consists of washing all walls and woodworkFsome sanding and other prep work will be neededD( )nly one coat of paint is

necessary to cover e%isting paint( Jll supplies will be provided at the start of the

task( Previous times on similar painting jobs are indicated in the table below(

1hat is your estimate of the average time you will

needL 1hat is your estimate of the varianceL

Est$mat$ng Tas2 9'rat$ons )$t! Incent$(es


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Tas2+ Cons$#er t!e pa$nt$ng jo* t!at "o' !a(ej'st est$mate#? No): !o)e(er: t!ere aree1p%$c$t $ncent$(es for meet$ng "o'r est$mate#

t$mes? If "o' f$n$s! pa$nt$ng t!e room *efore

"o'r spec$f$e# t$me: "o' )$%% rece$(e a 5*on's pa"ment? HOEVER: $f "o' f$n$s!

t!e pa$nt$ng jo* after "o'r spec$f$e# t$me: "o'

)$%% *e f$ne# 5?

Re($se# est$mate# t$me K

Est$mat$ng Tas2 9'rat$ons )$t! Incent$(es


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Tas2+ Cons$#er t!e pa$nt$ng jo* t!at "o' !a(ej'st est$mate#? No): !o)e(er: t!ere aree1p%$c$t $ncent$(es for meet$ng "o'r est$mate#

t$mes? If "o' f$n$s! pa$nt$ng t!e room *efore

"o'r spec$f$e# t$me: "o' )$%% rece$(e a 5*on's pa"ment? If "o' f$n$s! t!e pa$nt$ng jo*

after "o'r spec$f$e# t$me: t!ere $s no pena%t"?

Re($se# est$mate# t$me K


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I design user interfaces to please an audience of one.

I write them for me. If Im happy, I know some cool

people will like it. Designing user interfaces by

committee does not work very well; they need to be

coherent. As for schedule, Im not interested inschedules; did anyone care when War and Peacecame

out?

Developer, Microsoft CorporationAs reported by MacCormack and Herman, HBR Case 9-600-097:

Microsoft Office 2000

I design user interfaces to please an audience of one.

I write them for me. If Im happy, I know some cool

people will like it. Designing user interfaces by

committee does not work very well; they need to be

coherent. As for schedule, Im not interested inschedules; did anyone care when War and Peacecame

out?

Developer, Microsoft CorporationAs reported by MacCormack and Herman, HBR Case 9-600-097:

Microsoft Office 2000

Intra-team Comm'n$cat$on


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M K N'm*er of project team mem*ers

4 K N'm*er of %$n2s *et)een pa$rs of team mem*ers

5f M O, then 0 O &

5f M OE, then 0 O E

N'm*er of Intra-team 4$n2s


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Importance of Comm'n$cat$on


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On t!e occas$on of a m$grat$on from t!e east: men #$sco(ere# a

p%a$n $n t!e %an# of S!$nar: an# 3 sa$# to one anot!er: >Come: %et

's *'$%# o'rse%(es a c$t" )$t! a to)er )!ose top s!a%% reac! t!e

!ea(ens3?@ T!e 4or# sa$#: 3>Come: %et 's go #o)n: an# t!ere

ma2e s'c! a *a**%e of t!e$r %ang'age t!at t!e" )$%% not

'n#erstan# one anot!ers speec!?@ T!'s: t!e 4or# #$sperse#

t!em from t!ere a%% o(er t!e eart!: so t!at t!e" !a# to stop

*'$%#$ng t!e c$t"?

Genesis 11: 1-8

Project Performance an# Gro'p Harmon"


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T)o sc!oo%s of t!o'g!t+

&D /Kumanistic school2 -- groups that have positive

characteristics will perform well

D /+ask oriented2 school -- positive group

characteristics detract from group performance

1hat is the relationship between the design of

multidisciplinary project teams and project successL

Project Performance an# Gro'p Harmon" ;cont#i%ed Price 9ontractu 9lient pays a fi%ed price to the contractor irrespective of actual audited

cost of project

n 9ost Plus 9ontractu 9lient reimburses contractor for all audited costs of project Flabor, plant,

? materialsD plus additional fee Fthat may be fi%ed sum or percent of costs

incurredD

n #nits 9ontractu 9lient commits to a fi%ed price for a pre-specified unit of work6 final

payment is based on number of units produced

Incent$(e ;R$s2 S!ar$ng< Contracts


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Genera% Form+Pa"ment to S'*contractor K F$1e# Fee ;5 - =< ;Project Costi%ed Price 9ontract

0inear ? ignalling

9ontracts

!" 0se Incent$(e Contracts&


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E1pecte# Cost of Project K 5M

T)o f$rms *$# on s'*contract

F$rm 5 F$rm 6

F$1e# Fee ;*$#< L M M

Project Cost 5L M L M

;$neff$c$ent pro#'cer8 Minimum FtotalD slack per successor

n 4D J9+5Mj8 F.reatestD time from start of task j to end of project O 9P - 0j

n &"D J9+7@j8 Fma%D FJ9+5MjD

n &&D .@37@j8 w J9+5MjS F&-wD J9+7@j where " X w X &

Reso'rce A%%ocat$on Pro*%em 6


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Ho) to sc!e#'%e tas2s to m$n$m$e project ma2espan&

Pr$or$t" sc!eme+ sc!e#'%e tas2s 's$ng tota% s%ac2 ;$?e?: tas2s )$t!

sma%%er tota% s%ac2 !a(e !$g!er pr$or$t"


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Reso'rce A%%ocat$on E1amp%e ;cont#team@ t)o or more

)or2ers (ers's %ett$ng t!em )or2 separate%"&


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, Ha(e 6 )or2ers: =o* an# =ar*: an# 8 tas2s+ A: =: C: 9

, =o* an# =ar* can )or2 as a team: or t!e" can )or2 separate%"

, !en s!o'%# )or2ers *e ass$gne# to tas2s& !$c! conf$g'rat$on

#o "o' prefer&

Ho) to Ass$gn Project Teams&

J 9

t t


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Conf$g'rat$on 5

=o* an# =ar* )or2 jo$nt%" on a%% fo'r tas2sX ass'me t!at t!e" can comp%ete eac!

tas2 $n one-!a%f t!e t$me nee#e# $f e$t!er #$# t!e tas2s $n#$($#'a%%"

tart @nd

Conf$g'rat$on 6

=o* an# =ar* )or2 $n#epen#ent%"? =o* $s ass$gne# to tas2s A an# CX =ar* $s

ass$gne# to tas2s = an# 9

=o* an# =ar*+ Conf$g'rat$on 5


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Conf$g'rat$on 5

=o* an# =ar* )or2 jo$nt%" on a%% fo'r tas2s?!at $s t!e e1pecte# project ma2espan&

=o* an# =ar*+ Conf$g'rat$on 6=o* an# =ar* )or2 $n#epen#ent%"? =o* $s ass$gne# to tas2s A an# CX =ar* $s



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=o* an# =ar*+ Conf$g'rat$on 6

=o* an# =ar* )or2 $n#epen#ent%"? =o* $s ass$gne# to tas2s A an# CX =ar* $s



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E1pecte# Project Ma2espan+ 5?86

Para%%e% Tas2s )$t! Ran#om 9'rat$ons

STARTEN9

Tas2 A


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STARTEN9

Tas2 =

Jssume that both +asks J and have possible durations8

days with probability O "(!

&" days with probability O "(!

1hat is e%pected duration of projectL F5s it 4 daysLD

Stat's Report$ng&

One day my Boss asked me to submit a statusreport to him concerning a project I was working


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One day my Boss asked me to submit a statusreport to him concerning a project I was working

on. I asked him if tomorrow would be soon enough.

He said, "If I wanted it tomorrow, I would have

waited until tomorrow to ask for it!"

New business manager, Hallmark Greeting Cards

Contro% S"stem Iss'es

n 1hat are appropriate performance metricsL

1h d h ld b d i h l f h


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n 1hat data should be used to estimate the value of each

performance metricL

n Kow should data be collectedL >rom which sourcesL Jt

what freCuencyL

n Kow should data be analyzed to detect current and future

deviationsL

n Kow should results of the analysis be reportedL +o whomLKow oftenL

Contro%%$ng Project R$s2s

Key issues to control risk during projecct:

(1) what is optimal review frequency, and


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(1) what is optimal review frequency, and

(2) what are appropriate review acceptance levels

at each stage?

Both over-managed and under-managed

development processes result in lengthy design

lead time and high development costs.

Ahmadi & Wang. Managing Development Risk inProduct Design Processes, 1999

Project Contro% S"stem Var$at$on

Common cause variation: in-control or normal

variation


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variation

Special cause variation: variation caused by forces

that are outside of the system

Jccording to eming8

+reating common cause variation as if it were special cause variation

is called /tampering2

+ampering always degrades the performance of a system

Contro% S"stem E1amp%e 5

n Project p%an+ e est$mate t!at a tas2

)$%% ta2e 8 )ee2s an# re.'$re


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)$%% ta2e 8 )ee2s an# re.'$ren 5 )or2er-!o'rs

At t!e en# of ee2 5: 86 )or2er-!o'rs!a(e *een 'se#

Is t!e tas2 >o't of contro%@&

Contro% S"stem E1amp%e ;cont#*est

pract$ce@ #ata*ase as )e%% as p%an for $mpro($ng PM process

, Process of $mpro(ement #escr$*es t!e PM process from

>$neffect$(e@ to >opt$m$e#@

, A%so 2no)n as >Capa*$%$t" Mat'r$t" Mo#e%s@

PM Mat'r$t" Mo#e% E1amp%e[5< A#-Hoc T!e project management process $s #escr$*e# as #$sorgan$e#: an# occas$ona%%" e(en

c!aot$c? S"stems an# processes are not #ef$ne#? Project s'ccess #epen#s on $n#$($#'a% effort?

C!ron$c cost an# sc!e#'%e pro*%ems?

6< A**re($ate#+ Some project management processes are esta*%$s!e# to trac2 cost: sc!e#'%e:


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an# performance? 0n#er%"$ng #$sc$p%$nes: !o)e(er: are not )e%% 'n#erstoo# or cons$stent%"

fo%%o)e#? Project s'ccess $s %arge%" 'npre#$cta*%e an# cost an# sc!e#'%e pro*%ems are t!e norm?

7< Organ$e#+ Project management processes an# s"stems are #oc'mente#: stan#ar#$e#: an#

$ntegrate# $nto an en#-to-en# process for t!e compan"? Project s'ccess $s more pre#$cta*%e?

Cost an# sc!e#'%e performance $s $mpro(e#?

8< Manage#+ 9eta$%e# meas'res of t!e effect$(eness of project management are co%%ecte# an# 'se#

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