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
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