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201502-Semester II-MB0049-Project Management-DE
201502-Semester II-MB0049-Project Management-DE
a) PERT Model
Answer :
PERT Model
PERT Program Evaluation & Review Technique It is generally used for those projects where time
required to complete various activities are not known as a priori. It is probabilistic model & is primarily
concerned for evaluation of time. It is event oriented.
Measures of variability
Variability in PERT analysis is measured by variance or its square root, i.e. standard deviation. Variance of
a set of numbers is the average squared difference of the numbers in the set from their arithmetic average.
A simple example may be given to illustrate the calculation of variance. Let us take a series that consist of
numbers 4, 6, and 8. The average of this series is 6.
The differences of various numbers in the series from this average are -2, 0, and 2. Squaring them we get
4, 0, and 4. Hence, the variance the average of squared difference is 8/3 and standard deviation is
8/3.
The steps involved in calculating the standard deviation of the duration Office No. critical path are as
follows:
Step 1: Determine the standard deviation of the duration of each activity on the critical path.
Step 2: Determine the standard deviation of the total duration of the critical path on the basis of information
obtained in step 1.
In order to determine the standard deviation of the duration of an activity, we require the complete
probability distribution of the activity distribution. We, though, have just three values from this distribution: t p,
tm, and to. In PERT analysis, a simplification is used for calculating standard deviation. It is calculated by the
formula:
b) CPM model
Answer :
CPM Model
For projects considered uncertain, the PERT model was developed and for projects which are
comparatively risk-free the CPM model was developed. Both the approaches start with the development of
the network and a focal point on the critical path. Tthe PERT approach is 'probabilistic' while the CPM
approach is 'deterministic'. This does not, however, mean that in CPM analysis we work with single time
estimates. Actually the main focus of CPM analysis is on variations in activity times as a consequence of
changes in resource assignments. These variations are planned plus related to resource assignments as
well as are not caused by random factors outside the control of management as in the case of PERT
analysis. The major focus of CPM analysis is on time cost relationships and it seeks a project schedule that
minimises total cost.
Assumptions
The usual assumptions underlying CPM analysis are:
1. The costs associated with a project can be divided into two components: direct costs and indirect
costs. Direct costs are incurred on direct material and direct labour. Indirect costs consist of
overhead items like indirect supplies, rent, insurance, managerial services, etc.
2. Activities of the project can be expedited by crashing which involves employing more resources.
3. Crashing reduces time but enhances direct costs because of factors like overtime payments, extra
payments, and wastage. The relationship between time and direct activity cost can be reasonably
approximated by a downward sloping straight line. Below figure depicts a typical cost time line.
Procedure
Given the above assumptions, CPM analysis seeks to examine the consequences of crashing on total cost
(direct cost plus indirect cost). Since the behaviour of indirect project cost is well defined, the bulk of CPM
analysis is concerned with the relationship between total direct cost and project duration. The procedure
used in this respect is generally as follows:
Step 1: Obtain the critical path in the normal network. Determine the project duration and direct
cost.
Step 2: Examine the cost time slope of activities on the critical Pathan Street, obtained and crash
the activity which has the least slope.
Step 3: Construct the new critical path after crashing as per step 2. Determine project duration and
cost.
Step 4: Repeat steps 2 and 3 till activities on the critical path (which may change every time) are
crashed.
Answer :
Project-Type Organisation
In a project-type organisational structure, the employees work for different projects in a team-like structure.
Examples are construction companies, where different teams work on different projects.
Teams are put together for a project. Each project is headed by a project leader. Each team will have
employees to suit its demands and complete the project successfully. Only employees with requisite
specialised skills are considered for project teams. These members of project team will join back their
parent company once the project gets finished.
In project-type organisational structure, each project is handled like a small company. All the essential
resources and paraphernalia needed to execute projects are procured for full-time till the project closes out.
Employees having specialised knowledge and exposure to similar project environment will be appointed on
contractual terms to work in a group and deliver the project expectations.
Answer :
Competitive bid
The steps involved in competitive bid are discussed below:
1. The bid or tender is invited from a required number of suppliers. Below table depicts a typical
structure of bid.
S.N.
Particulars
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Suppliers
Response
2. The bid received in prescribed condition are accepted and held in safe custody.
3. The bids are opened and made public at the stated time and place in the presence of the bidders
who are present.
4. The information received from bidders is tabulated on a comparative statement which allows
comparison of quoted prices, validity periods, and other critical factors.
b) Mention the elements/points that must be kept in view when designing , developing and
operating a PMIS (Project Management Information System)
Answer :
management goals. It is used to compare the baseline with the actual achievement Office No. each activity,
manage materials, collect financial data, and keep a record for reporting purposes. The PMIS is used to
assess the goals to ensure if the tasks were accomplished when project is closed after that, it is employed
to make a final report of the project close. To understand this concept better, we should first understand the
distinction between data and information.
Data
Data are values of qualitative or quantitative variables belonging to a set Office No. items. They represent
something in the real world, expressed as a number or a statement or a picture and act as an input to MIS.
Information
Information may be defined as, (i) data within a context, (ii) data in a relationship, or (iii) processed data. It
does not convey much. But, when we say it denotes an age of a student of a class, it gets some meaning.
Log Office No. daily production figures in a year do not convey much. But when we calculate their average,
standard deviation, range, and trend, we get much more meaning out of them.
System
A system consists of a set of sub-systems/components that work together to achieve a common goal. It
comprises of interacting or interdependent components forming an integrated whole.
Answer :
Business objectives: Restate the business objectives as given in the business case
including any changes incorporated later. Comment on how far these objectives have been
or likely to be met.
Project efficiency: State the actual cost, resource, and schedule against the plan as shown
in the below table
Cost (Lacs of Rs.)
Human
Resource
(Man
Schedule (days)
days)
Original
Baseline
Actual
Variance
Closure statement: State the circumstances under which the project is being closed as one of the
following:
The project has been terminated prior to the completion. In this case, describe the reason for
termination.
Outstanding issues and deliverables: List any issues or key deliverables not yet accepted. For
each, give:
Managing of projects: How the projects different phases were managed? Specifically, comment on the
following aspects:
Lessons learnt and recommendations: A number of insight and innovative methods have been
adopted in tackling the various problems. These should be recorded for posterity. Specifically, the
following aspects are to be covered:
Recommend methods, processes, procedures, best practices, and tools which can be gainfully
used in the future.
Identify the areas where time, money, or resources could have been better utilised.
Acknowledgement: Acknowledge all the individuals who have made special contributions to the
project.
Recognise the specific individuals and the team for making valuable contribution
Summary of the project including major achievement, business benefits, major obstacles faced,
impact of project on stakeholders, and lessons learnt.
Outstanding issues: Review outstanding issues, indicate persons who will resolve the issues.
Post-implementation review: Indicate the terms of reference, persons accountable, team
members, and time table.
Recognition of team members: Recognise the specific contributions made by individuals and
team and present awards to them.
Formal acceptance: Get formal acceptance of the sponsor by signing the certificate of acceptance.
Acknowledgement and formally closing the project: Thank the customer, sponsor, stakeholders,
and team for their effort and contributions to achieve a success. Declare the project as closed.
Answer :
Below figure, explains the probability of risk in different stages of project life cycle. It shows that the
probability of risks is higher in the initial phases in comparison to closing phases. The highlighted point
shows the maximum probability of risk happening.
In comparison to probability of risk, the impact of risks is opposite. The impact of risks is less in the initial
stages of a project life cycle and higher in the closing phases. Below figure depicts the impact of risks on
various stages of a project life cycle.
In above figure, the highlighted point shows the maximum impact area of a project life cycle.
b) Quality assurance
Answer :
Quality Assurance
Quality assurance means all the systematic and planned activities executed within the quality system give
confidence that the project will meet the applicable quality standards. It also comprises the examination of
data at stations and centres to validate that the data are in line with the quality system goals, and to identify
errors so that the required action could be taken on time. A quality system should incorporate procedures
that allow to feed back into the measurement and quality control process to avoid the errors from occurring
again. We can apply quality assurance in real-time post measurement, and can also feed into the quality
control process for the subsequent process of a quality system, but usually it tends to operate in non-real
time.
Quality assurance tests make use of a system of metrics to decide whether or not the quality plan is
progressing in an acceptable manner. You can measure project quality with customer satisfaction effectively
by using both qualitative and quantitative metrics. These tests or quality audits will assist you in forecasting
and verifying the accomplishment of goals and identify need for corrective actions. Additionally, quality
assurance tests will also help you in mapping quality metrics to quality goals, thereby allowing you to report
on quality status at periodic project review meetings.
In most cases, quality assurance provided by a quality assurance department or similarly titled
organisational unit, but it is not mandatory that only these departments do this. Quality assurance may be
provided to the team managing the project. It may also be provided to the management Office No. the
performing organisation (internal quality assurance) or it may be provided to the customer and others not
actively involved in the work of the project (external quality assurance).
Apart from the quality management plans and operational definitions discussed under inputs to
quality planning, the inputs to quality assurance includes the following:
Results of quality control measurements: These are the records Office No. quality control testing
and measurement for comparison and analysis.
For example, work hours can be modified, company holidays can be entered as non-working days,
and various shifts can be entered.
Human resources: Suppose a particular activity needs 2 unskilled person and 1 skilled person to
complete the task. These two resources may be entered separately and will appear as 2L and 1S
on activity description in network.
Labour cost: One of the many ways to specify labour cost is as,
Human resources available: All software requires periods and amount of resources that are
available for the project.
Cost of construction materials: Materials needed for each task and their estimated costs for the
project may be as given below:
Table : Materials needed and Estimated cost is to be Entered Against each Activity
Data entry error: All good management software contains error detection routines that identify and reports
errors. However, there are certain errors which cannot be detected by software. These include:
An incorrect activity duration
An incorrect activity name
An Incorrect precedence logic
An Incorrect cost data
A wrong resource entered
These errors have to be corrected manually by listing of the activity records.