Concepts and Definitions - Chapter 9

Concepts and Definitions - Chapter 9 Learning Objective 9-1: Typical reasons PMs must shorten overall project duration  Estimated completion date exceeds promised delivery date for new product ("time to market"), marketing rollout, software go-live, etc.  Schedule slippage during earlier activities  Shifting focus away from budget to schedule, imposing a new project deadline Considerations when shortening duration  Reducing duration of an activity ("crashing") must follow a logical, systematic approach, determining which activities to shorten  Crashing an activity reduces the time it requires, but almost always increases its cost, due to increased resource assignment, overtime, etc. Learning Objective 9-2: Options for duration-reduction when there are no resource constraints (There are resources available "on the bench" or outside the organization)  Add resources: o Assumes you can divide activities efficiently between resources o Seldom reduces duration on activities, like software development, that don't divide easily  Outsource project work  Schedule overtime: o Unimaginative last resort [Reflects a planning failure] o Undermines morale o May involve the cost of a payroll premium  Establish a core (or fully dedicated) team for the project [If you have the resources to do this, why wouldn't you make it a standard policy?]  Do it quick and dirty, then test it [Then, assuming this strategy works, ask yourself why you aren't doing this on a regular basis] Learning Objective 9-3: Options for duration-reduction when faced with resource constraints (no additional resources available)  If possible, improve team efficiency [ If this is possible, why wouldn't you do it anyway? ]  Run critical activities in parallel or change FS relationships to SS [ If this is possible, why wouldn't you do it anyway? ]  Use Critical-Chain Project Management (CCPM) o Differs from critical path or PERT methodologies

o Developed by Eliyahu M. Goldratt to emphasize resource assignment over time estimates o Beyond the scope of this course  Reduce project scope, by postponing noncritical features or shifting responsibilities to the customer [ If this is possible, why wouldn't you do it anyway? ]  Compromise quality - May be necessary, with customer agreement, when faced with resource constraints and need to crash Learning Objective 9-4: 3 steps to constructing a project cost-duration graph  Find total direct costs for selected project durations  Find total indirect costs  Total direct costs + Total indirect costs = Total costs Project direct costs include:  Labor  Materials  Equipment rental  Overhead incurred for that project alone Project indirect costs include:  Interest expenses  Supervisor and PM salaries allocated across multiple projects  Consultants and contractors used on multiple projects Crash time and crash costs:  Crash time = shortest time in which you can complete an activity  Crash cost = new cost estimated for an activity resulting from the time reduction  Cost slope = "rise over run" = (crash cost - normal cost) / (normal time/crash time)  The less steep the cost slope, the less it shortens time units for an activity Learning Objective 9-5: Practical considerations when shortening duration  Best time to estimate durations and plan for the possibility of crashing is always before the project begins, before you face pressures to complete the project by a deadline  Crash time estimation is unpredictable and problematic at best  4 considerations when crashing: o Inherent risks of the activity crashing creating issues downstream o Resource availability after crashing (Frequently results in overallocation of resources) o When during the project to crash (May be prudent if there's reason to believe subsequent activities will take longer than expected and absorb the time gained o Can undermine morale and lead to fatigue and resentment  Reducing duration tends to increase network sensitivity