Work Breakdown Structure
Consider a recent project that you have worked on. This could be for a company or organization with which you are familiar, or even a personal project such as purchasing a home or planning a family gathering. After your opening paragraph, which includes your thesis statement, identify your selected company or organization in no more than three paragraphs. Then, complete the following: *Note: for the charts/diagrams, use MS Word, Excel, Google Docs or Google Sheets. You may also use any other suitable project-based software. A free Project management software called Libre is also available for download here https://sourceforge.net/projects/projectlibre/
- Create either a Work Breakdown Structure (WBS) of the project or Gantt Chart for planning and scheduling the project. Discuss why you used the type of chart you did.
- Determine and document both probabilistic (t0, tp, and tm) and deterministic time estimates. Discuss how you arrived at these time estimates.
- Using MS Word, Google Docs, or similar software, create a PERT network diagram with the Critical Path (CP) identified.
- Calculate the slack time for each activity. Discuss the ramifications of slack in the CP for the activities and the project as a whole.
- Develop the network diagram from the probability estimates. Discuss which path you would take and why.
- For each activity, determine hypothetical costs in a table. Include budgeted costs, percent complete, actual/projected cost, and over/under budget (and total). Discuss the rationale for how you derived these costs.
- Crash an activity on the Critical Path. Discuss the ramifications of crashing the activity you crashed.
Formatting requirements:
- Required 6-8 pages in length, which does not include the title page and reference pages, which are never a part of the content minimum requirements.
- Charts/diagrams should be labeled and can be added within the body of your paper.
- Support your submission with course material concepts, principles, and theories from the textbook and at least three scholarly, peer-reviewed journal articles. Use the Saudi Digital Library to find your resources.
- Formatted according to APA 7th writing standards.
- It is strongly encouraged that you submit all assignments into Turnitin prior to submitting them to your instructor for grading. If you are unsure how to submit an assignment into the Originality Check tool, review the Turnitin – Student Guide for step-by-step instructions. Review the grading rubric to see how you will be graded for this assignment.
Required:
Chapter 17 PowerPoint slides 
Module 12 Chapter 17 PowerPoint slides – Alternative Formats – Operations Management
Takakura, Y., Yajima, T., Kawajiri, Y., & Hashizume, S. (2019). Application of critical path method to stochastic processes with historical operation data. Chemical Engineering Research & Design: Transactions of the Institution of Chemical Engineers Part A, 149, 195–208. https://doi.org/10.1016/j.cherd.2019.06.0
Hernández-Bastida, A., & Fernández-Sánchez, M. P. (2019). How adding new information modifies the estimation of the mean and the variance in PERT: a maximum entropy distribution approach. Annals of Operations Research, 274(1/2), 291–308.
Calp, M., & Akcayol, M. (2019). Optimization of project scheduling activities in dynamic CPM and PERT networks using genetic algorithms. Journal of Natural and Applied Sciences. 22(2), 615-627.
You should be able to:
LO 17.1 Describe the project life cycle
LO 17.2 Discuss the behavioral aspects of projects in terms of project personnel and the project manager
LO 17.3 Explain the nature and importance of a work breakdown structure in project management
LO 17.4 Name the six key decisions in project management
LO 17.5 Give a general description of PERT/CPM techniques
LO 17.6 Construct simple network diagrams
LO 17.7 Analyze networks with deterministic times
LO 17.8 Analyze networks with probabilistic times
LO 17.9 Describe activity ‘crashing’ and solve typical problems
LO 17.10 Discuss the advantages of using PERT and potential sources
of error
LO 17.11 Discuss the key steps in risk management
Chapter 17: Learning Objectives
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2
Projects
Unique, one-time operations designed to accomplish a specific set of objectives in a limited time frame
Examples:
The Olympic Games
Producing a movie
Software development
Product development
ERP implementation
Projects
LO 17.1
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Projects go through a series of stages – a life cycle
Projects bring together people with a diversity of knowledge and skills, most of whom remain associated with the project for less than its full life
Organizational structure affects how projects are managed
The Nature of Projects
LO 17.1
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17-‹#›
Initiating
Planning
Executing
Monitoring and Controlling
Closing
Project Life Cycle
LO 17.1
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The project manager is ultimately responsible for the success or failure of the project
The project manager must effectively manage:
The work
The human resources
Communications
Quality
Time
Costs
Project Manager
LO 17.2
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The Project Management Triangle
Quality
Performance Objectives
Schedule
Cost
LO 17.2
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Behavioral problems can be created or exacerbated by
Decentralized decision making
Stress of achieving project milestones on time and within budget
Surprises
The team must be able to function as a unit
Interpersonal and coping skills are very important
Conflict resolution and negotiation can be an important part of a project manager’s job
Behavioral Issues
LO 17.2
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Many problems can be avoided or mitigated by:
Effective team selection
Leadership
Motivation
Maintaining an environment of
Integrity
Trust
Professionalism
Being supportive of team efforts
Avoiding Problems
LO 17.2
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Project champion
A person who promotes and supports a project
Usually resides within the organization
Facilitate the work of the project by ‘talking up’ the project to other managers who might be asked to share resources with the project team as well as employees who might be asked to work on parts of the project
The project champion can be critical to the success of a project
Project Champion
LO 17.2
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WBS
A hierarchical listing of what must be done during a project
Establishes a logical framework for identifying the required activities for the project
Identify the major elements of the project
Identify the major supporting activities for each of the major elements
Break down each major supporting activity into a list of the activities that will be needed to accomplish it
Work Breakdown Structure (WBS)
LO 17.3
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WBS
LO 17.3
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Project success depends upon making key managerial decisions over a sequence of steps:
Deciding which projects to implement
Selecting the project manager
Selecting the project team
Planning and designing the project
Managing and controlling project resources
Deciding if and when a project should be terminated
Project Management Decisions
LO 17.4
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17-‹#›
PERT (program evaluation and review technique) and CPM (critical path method) are two techniques used to manage large-scale projects
By using PERT or CPM Managers can obtain:
A graphical display of project activities
An estimate of how long the project will take
An indication of which activities are most critical to timely project completion
An indication of how long any activity can be delayed without delaying the project
PERT and CPM
LO 17.5
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Network diagram
Diagram of project activities that shows sequential relationships by use of arrows and nodes
Activity on arrow (AOA)
Network diagram convention in which arrows designate activities
Activity on node (AON)
Network convention in which nodes designate activities
Activities
Project steps that consume resources and/or time
Events
The starting and finishing of activities
Network Diagram
LO 17.6
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Network Conventions
LO 17.6
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Deterministic Time Estimates
Deterministic
Time estimates that are fairly certain
Probabilistic
Time estimates that allow for variation
LO 17.7
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Finding ES and EF involves a forward pass through the network diagram
Early start (ES)
The earliest time an activity can start
Assumes all preceding activities start as early as possible
For nodes with one entering arrow
ES = EF of the entering arrow
For activities leaving nodes with multiple entering arrows
ES = the largest of the largest entering EF
Early finish (EF)
The earliest time an activity can finish
EF = ES + t
Early Start, Early Finish
LO 17.7
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Finding LS and LF involves a backward pass through the network diagram
Late Start (LS)
The latest time the activity can start and not delay the project
The latest starting time for each activity is equal to its latest finishing time minus its expected duration:
LS = LF – t
Late Finish (LF)
The latest time the activity can finish and not delay the project
For nodes with one leaving arrow, LF for nodes entering that node equals the LS of the leaving arrow
For nodes with multiple leaving arrows, LF for arrows entering node equals the smallest of the leaving arrows
Late Start, Late Finish
LO 17.7
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Slack can be computed one of two ways:
Slack = LS – ES
Slack = LF – EF
Critical path
The critical path is indicated by the activities with zero slack
Slack and the Critical Path
LO 17.7
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Knowledge of slack times provides managers with information for planning allocation of scarce resources
Control efforts will be directed toward those activities that might be most susceptible to delaying the project
Activity slack times are based on the assumption that all of the activities on the same path will be started as early as possible and not exceed their expected time
If two activities are on the same path and have the same slack, this will be the total slack available to both
Using Slack Times
LO 17.7
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Probabilistic Time Estimates
The beta distribution is generally used to describe the inherent variability in time estimates
The probabilistic approach involves three time estimates:
Optimistic time, (to)
The length of time required under optimal conditions
Pessimistic time, (tp)
The length of time required under the worst conditions
Most likely time, ™
The most probable length of time required
LO 17.8
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The Beta Distribution
LO 17.8
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The expected time, te ,for an activity is a weighted average of the three time estimates:
The expected duration of a path is equal to the sum of the expected times of the activities on that path:
Probabilistic Time Estimates
LO 17.8
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The standard deviation of each activity’s time is estimated as one-sixth of the difference between the pessimistic and optimistic time estimates. The variance is the square of the standard deviation:
Standard deviation of the expected time for the path
Probabilistic Time Estimates (cont.)
LO 17.8
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Knowledge of expected path times and their standard deviations enables managers to compute probabilistic estimates about project completion such as:
The probability that the project will be completed by a certain time
The probability that the project will take longer than its expected completion time
Knowledge of Path Statistics
LO 17.8
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Path Probabilities
Calculating path probabilities involves the use of the normal distribution
Although path activities are represented by the beta distribution, the path distribution can be represented by a normal distribution
LO 17.8
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Determining Path Probabilities
LO 17.8
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A project is not complete until all project activities are complete
It is risky to only consider the critical path when assessing the probability of completing a project within a specified time
To determine the probability of completing the project within a particular time frame
Calculate the probability that each path in the project will be completed within the specified time
Multiply these probabilities
The result is the probability that the project will be completed within the specified time
Project Completion Time
LO 17.8
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Independence
Assumption that path duration times are independent of each other
Requires that
Activity times are independent
Each activity is on only one path
The assumption of independence is usually considered to be met if only a few activities in a large project are on multiple paths
Assumption: Independence
LO 17.8
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When activity times cannot be assumed to be independent, simulation is often used
Repeated sampling is used
Many passes are made through the project network
In each pass, a random value for each activity time is selected based on the activity time’s probability distribution
After each pass, the project’s duration is determined
After a large number of passes, there are enough data points to prepare a frequency distribution of the project duration
Probabilistic estimates of completion times are made based on this frequency distribution
Simulation
LO 17.8
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Activity time estimates are made for some given level of resources
It may be possible to reduce the duration of a project by injecting additional resources
Motivations:
To avoid late penalties
Monetary incentives
Free resources for use on other projects
Time-Cost Trade-Offs
LO 17.9
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Crashing
Shortening activity durations
Typically, involves the use of additional funds to support additional personnel or more efficient equipment, and the relaxing of some work specifications
The project duration may be shortened by increasing direct expenses, thereby realizing savings in indirect project costs
Time-Cost Trade-Offs: Crashing
LO 17.9
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To make decisions concerning crashing requires information about:
Regular time and crash time estimates for each activity
Regular cost and crash cost estimates for each activity
A list of activities that are on the critical path
Critical path activities are potential candidates for crashing
Crashing non-critical path activities would not have an impact on overall project duration
Crashing Decisions
LO 17.9
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General procedure:
Crash the project one period at a time
Crash the least expensive activity that is on the critical path
When there are multiple critical paths, find the sum of crashing the least expensive activity on each critical path
If two or more critical paths share common activities, compare the least expensive cost of crashing a common activity shared by critical paths with the sum for the separate critical paths
Crashing: Procedure
LO 17.9
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Crashing Activities
LO 17.9
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Among the most useful features of PERT:
It forces the manager to organize and quantify available information and to identify where additional information is needed
It provides the a graphic display of the project and its major activities
It identifies
Activities that should be closely watched
Activities that have slack time
PERT: Advantages
LO 17.10
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Sources of Error
Potential sources of error:
The project network may be incomplete
Precedence relationships may not be correctly expressed
Time estimates may be inaccurate
There may be a tendency to focus on critical path activities to the exclusion of other important project activities
Major risk events may not be on the critical path
LO 17.10
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Risks are an inherent part of project management
Risks relate to occurrence of events that have undesirable consequences such as
Delays
Increased costs
Inability to meet technical specifications
Risk Management
LO 17.11
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Good risk management involves
Identifying as many risks as possible
Analyzing and assessing those risks
Working to minimize the probability of their occurrence
Establishing contingency plans and budgets for dealing with any that do occur
Risk Management (cont.)
LO 17.11
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