Chapter 1: Modern Project Management

1. Define a project. What are five characteristics that help differentiate projects from other functions
carried out in the daily operations of the organization?
A project is a complex, non routine, one-time effort limited by time, budget, resource, and specifications.
Differentiating characteristics of projects from routine, repetitive daily work are below five characteristics:
- An established objective
- A defined lifespan with a beginning and an end
- The involvement of several departments and professionals
- Doing something that has never been done before
- Specific time, cost, and performance requirements
2. What are some of the key environmental forces that have changed the way projects are managed? What
has been the effect of these forces on the management of projects?
Some environmental forces that have changed the way we manage projects are the Compression of the product
life cycle, knowledge growth, global competition, Triple bottom line (planet, people, profit) organization
downsizing, technology changes, and time to market.
The impact of these forces is more projects per organization, project teams responsible for implementing
projects, accountability, changing organization structures, need for rapid completion of projects, linking projects to
organization strategy and customers, prioritizing projects to conserve organization resources, and alliance with
external organizations
3. Describe the four phases of the traditional project life cycle. Which phase do you think would be the
most difficult one to complete?
The four phases of the traditional project life cycle are:
- Defining stage: Specifications of the project are defined; project objectives are established; teams are formed;
major responsibilities are assigned.
- Planning stage: Plans developed to determine what the project will entail, when it will be scheduled, whom it
will benefit, what quality level should be maintained, and what the budget will be.
- Executing stage: Physical products are produced. Time, cost, specification measures are used for control.
- Closing stage: Delivering of the product, redeploying project resources, and conducting a post-project review.

While I believe each stage is important, the most difficult phase in my opinion would be the executing stage.
During this stage the majority of the work takes place and will largely determine the success of the project. Defining,
and planning are no good if you are unable to execute according to those plans.
4. What kinds of projects is AgilePM best suited for and why?
Agile PM is the best methodology to follow in case of complexity and uncertainty, which requires creativity
and innovation in finding the best solution are more important than predictability, planning, and control
projects. Because a complex project may have various interconnected phases and each stage may be dependent
on many others rather than a single one as in simple projects. (The final project design/outcome is not known
in great detail and is continuously developed through a series of incremental iterations. At the end of each
iteration, progress is reviewed, adjustments are made, and a different iterative cycle begins. Each new iteration
subsumes the work of the previous iterations until the project is completed and the customer is satisfied.) So,
Agile methods are preferred for large and complex projects. A good example of this would be software
projects because software projects are notorious for having unstable scopes in which end user requirements are
discovered and not defined up front.

[What is Agile project management good for?

Agile helps teams and individuals effectively prioritize work and features. Teams can anticipate incoming
project changes. Teams can make quick-course corrections based on stakeholder feedback. Teams can prototype a
solution or process for the next version of the project.]

5. The technical and sociocultural dimensions of project management are two sides of the same coin.
Explain.
They are two sides of the same coin because managing projects involves balancing the technical and
sociocultural dimensions of the project.
The first dimension is the technical side of the management process, which consists of the formal, disciplined,
purely logical parts of the process. This technical dimension includes planning, scheduling, and controlling projects.
The second dimension is the sociocultural side of project management. In contrast to the orderly world of
project planning, this dimension involves the much messier, often contradictory and paradoxical world of
implementation. It centers on creating a temporary social system within a larger organizational environment that
combines the talents of a divergent set of professionals working to complete the project.
Some suggest that the technical dimension represents the "science" of project management, while the
sociocultural dimension represents the "art" of managing a project. To be successful, a manager must be a master of
both.

Chapter 2: Organization Strategy and Project Selection

1. Describe the major components of the strategic management process.
The strategic management process is made up of four elements:

● Review and define the organizational mission.

A written mission statement identifies the scope of the organization in terms of its product or service. The
mission statement communicates and identifies the purpose of the organization to all stakeholders. Mission
statements can be used for evaluating organization performance.
More specific mission statements tend to give better results because of a tighter focus. Mission statements decrease
the chance of false directions by stakeholders.
● Set long-range goals and objectives.
Organizational objectives set targets for all levels of the organization. Objectives answer in detail where a firm
is headed and when it is going to get there.
Objectives should include a time frame, be measurable, be an identifiable state, and be realistic. (SMART)
● Analyze and formulate strategies to reach objectives.
Strategy formulation includes determining and evaluating alternatives that support the organization’s
objectives and selecting the best alternative. The first step is a realistic evaluation of the past and current position of
the enterprise. The next step is an assessment of the internal and external environments.
Strategy formulation ends with cascading objectives or projects assigned to lower divisions, departments, or
individuals. Formulating strategy might range around 20 percent of management’s effort, while determining how
strategy will be implemented might consume 80 percent.
● Implement strategies through projects:
Implementation answers the question of how strategies will be realized, given available resources. The
conceptual framework for strategy implementation lacks the structure and discipline found in strategy formulation.
Implementation requires action and task completion; the latter frequently means mission-critical projects. Therefore,
implementation must include attention to several key areas

2. Explain the role projects play in the strategic management process.

Strategy is implemented primarily through projects. As part of the strategic management process, projects may
focus on both the external customer environment and internal activities required to support better alignment of
operations and strategic objectives. Successful implementation of projects means reaching the goals of the
organization and thus meeting the needs of its customers.
3. How Are Projects Linked To The Strategic Plan?
The most important criteria for selecting a project is that the project will fit with the organization strategy.
Organizations need to maximize the use of their resources by allocating resources to projects that will contribute to
the strategic plan. Because projects represent how a strategy is to be implemented. The best way to maximize the
organization's scarce resources is through a priority scheme which allocates resources to a portfolio of projects which
balance risk and contribute the most to the strategic plan.
4. The portfolio of projects is typically represented by compliance, strategic, and operations projects.
What impact can this classification have on project selection?
- Strategic = support org in long run; increase rev & MS
- Compliance = meet regulatory conditions to operate; must do
- Operational = improve efficiency & delivery
It can impact project selection because all of these classifications have a specific value, and if a compliance
classified project is pushed behind a strategic compliance it may be detrimental for the company. Therefore, by
carefully aligning your project proposal with one classification, you may increase the chances of it being selected.
Senior management typically allots budgets for each category independent of actual project selection. Knowledge of
funds available, risk portfolio, senior management bias may cause some to attempt to move their project proposal to
a different classification to improve the chances of the project being selected.

5. Why does the priority system described in this chapter require that it be open and published? Does the
process encourage bottom-up initiation of projects? Does it discourage some projects? Why?
An open, published priority system ensures projects are selected on the basis of their contribution to the
organization. If the priority system is not open, squeaky wheels, strong people, and key departments all get their
projects selected for the wrong reason and can lead to problems within the organization. If it isn't open it can create 3
specific issues:

1) Implementation Gap
2) Organization Politics
3) Resource conflicts and multitasking

Bottom-up is encouraged because every organization member can self evaluate their project idea against
priorities - and so can everyone else in the organization. To some, this approach may look intimidating but rarely is
in practice, it does discourage projects that clearly will not make positive, significant contributions to the
organization vision.

6. Why should an organization not rely only on ROI to select projects?

Even though financials help evaluate a project's return, financial criteria, like ROI alone, will not ensure that
selected projects contribute to the mission and strategy of a firm. Other considerations such as developing new
technology, public image, brand loyalty, ethical position, and maintaining core competencies should be considered.
Furthermore, it is difficult or next to impossible to assess ROI for many important projects (e.g., Y2K projects).
While ROI is likely to be a key consideration for many organizations, multiple screening criteria are
recommended for selecting and prioritizing projects.
7. Discuss the pros and cons of the checklist versus the weighted factor method of selecting projects.
Checklist:
- have flexibility
- Applies over a wide range of different types of projects, divisions, and locations
- doesn't answer relative importance or value of a project
- doesn't let you compare with other projects
- Politics, power, and manipulation of project selection is very possible

Weighted Factor Model

- allows comparison and ranking of potential projects
- open system
- allows self evaluation of proposed project
- power and politics are exposed

Chapter 3: Organization: Structure and Culture

1. What distinguishes a weak matrix from a strong matrix?

The most distinguishing characteristic between a weak and strong matrix is : the relative influence the project
manager has over project participants and functional managers.
In a weak matrix:
+ The project manager role is limited to coordinating project activities.
+ The functional managers are responsible for managing their segment of the project.
+ The project manager has little formal authority over the project.
In a strong matrix:
+ The project manager controls most aspects of the project including design trade-offs and assignment of project
personnel.
+ The functional managers are responsible for supporting project completion.
+ A project manager in the weak matrix is not likely to be involved in performance appraisals and compensation
decisions while project managers in a strong matrix would.
2. Under what conditions would it be advisable to use a strong matrix instead of a dedicated project team?
Both structures can be quite effective.
The strong matrix would be recommended when the organization cannot afford to have people work full-time
on the project and when the culture of the organization supports the dual authority structure.
Dedicated project teams are recommended when speed is essential to success and there is not enough project
work to warrant a formal matrix structure.
Dedicated project teams are also recommended when the prevalent culture within the organization does
not support collaboration and innovation
3. How can project management offices (PMOs) support effective project management?
POs support effective project management by:
- Tracking project progress
- Promulgating best practices
- Providing project management training and consulting services
- Integrating latest advances in the field of project management
- Being an organizational advocate
It should be noted that the extent to which a PO performs the above functions will vary from one organization
to the next.
4. Why is it important to assess the culture of an organization before deciding what project management
structure should be used to complete a project?
The culture of the organization can impact the effectiveness of different project management structures.
Besides, projects that are in line with the organizational culture may have smoother implementation and higher
success rates compared to projects that conflict with these cultural standards. Organizational cultures that do not
encourage teamwork, collaboration, and cross-functional integration need a stronger project management structure
(i.e., project team, project matrix) to be successful.
5. Other than culture, what other organizational factors should be used to determine which project
management structure should be used?
The two major considerations are the percentage of core work that involves projects and resource availability.
Organizations, whose main business evolves around projects, should consider a projectized form of structure.
Organizations that have mainstream operations and projects should use a matrix structure. When resource
availability is limited then a matrix structure should be used that allows sharing personnel across projects and
operations.
6. What do you believe is more important for successfully completing a project—the formal project
management structure or the culture of the parent organization?
Both are important and an argument can be made for either structure or culture.
The bias of the authors is that culture is more important than structure since it more directly impacts
behavior. A positive organizational culture can compensate for the inherent weaknesses of the formal structure. For
example a functional or matrix structure can be effective if the norms and customs of the organization value
teamwork and effective problem-solving.
Conversely, a functional or matrix structure is likely to be disastrous in a negative culture that
encourages competition and looking out only for yourself. Alternatively, one could argue that an organization
can circumvent a negative culture by creating an independent project team or a strong project matrix. In
either case, the strategy is to insulate the project team from the dominant organizational culture and create
a unique project subculture.
Chapter 4: Defining the Project
1. When establishing project priorities, the project team identifies that the project should be completed
on time. In a priority matrix, which type of priority is suitable for that project’s time criterion -
Constrain
2. What is the outcome of a process that successively divides the work of a project into smaller and
smaller work elements? - Work breakdown structure.
3. What is the result of a process that identifies what, who, how, and when the information will be
communicated to project stakeholders? - Project communication plan
4. What is the outcome of a process that organizes project around phases and then breaks down the
major phases into more minor activities - Process breakdown structure
5. How many kinds of information are included in a work package? - 6
6. Which element of a project scope statement is suitable for this statement “This project is to conduct
an orientation week for NEU’s new students in early September 2021, the budget for this project is
VND 200 million”? - Project objective.

1. What are the eight elements of a typical scope statement?

1. Project objective:
The first step of project scope definition is to define the overall objective to meet your customer’s need(s). The
project objective answers the questions of what, when, how much, and times where. (For example, as a result of
extensive market research a computer software company decides to develop a program that automatically translates
verbal sentences in English to Russian. The project should be completed within three years at a cost not to exceed
$1.5 million. Another example is to design and construct a portable hazardous-waste thermal treatment system in 13
months at a cost not to exceed $13 million.)

2. Product scope description:

This step is a detailed description of the characteristics of the product, service, or outcome of the project. The
description is progressively elaborated throughout the project. The product scope answers the question “What end
result is wanted?” For example, if the product is a cell phone, its product scope will be its screen size, battery,
processor, camera type, memory, and so on.

3. Justification:
It is important that project team members and stakeholders know why management authorized the project.
This is sometimes referred to as the business case for the project, since it usually includes cost/benefit analysis and
strategic significance. For example, on a new release project, the justification may be an expected ROI of 30 percent
and an enhanced reputation in the marketplace.

4. Deliverables:
The next step is to define major deliverables—the expected, measurable outputs over the life of the project.
Note: Deliverables and requirements are often used interchangeably. For example, deliverables in the early design
phase of a project might be a list of specifications. In the second phase deliverables might be software coding and a
technical manual. The next phase might be the prototype. The final phase might be final tests and approved
software.

5. Milestones:
A milestone is a significant event in a project that occurs at a point in time. The milestone schedule shows
only major segments of work; it represents first, rough-cut estimates of time, cost, and resources for the project. The
milestone schedule is built using the deliverables as a platform to identify major segments of work and an end date —
for example, testing complete and finished by July 1 of the same year. Milestones should be natural, important
control points in the project. Milestones should be easy for all project participants to recognize.

6. Technical requirements:
More frequently than not, a product or service will have technical requirements to ensure proper performance.
Technical requirements typically clarify the deliverables or define the performance specifications. Examples from
information systems projects include the speed and capacity of database systems and connectivity with alternative
systems.

7. Limits and exclusions:

The limits of scope should be defined. Failure to do so can lead to false expectations and to expending
resources and time on the wrong problem. The following are examples of limits: work on-site is allowed only
between the hours of 8:00 p.m. and 5:00 a.m.; system maintenance and repair will be done only up to one month
after final inspection; and the client will be billed for additional training beyond that prescribed in the contract.
Exclusions further define the boundary of the project by stating what is not included. Examples include: data
will be collected by the client, not the contractor; a house will be built, but no landscaping or security devices
added; software will be installed, but no training given.

8. Acceptance criteria:
Acceptance criteria are a set of conditions that must be met before the deliverables are accepted. The following
are examples: all tasks and milestones are complete, new service processes begin with a less than 1 percent defect
rate, third-party certification is required, and customer on-site inspection is required.

2. What questions does a project objective answer? What would be an example of a good project
objective?
The project objectives answers what, when, and how much (What the project is, when the project should be
finished, and how much it will cost).
In general, Project Objectives answer the question HOW or What Kind (characteristics)? such as How are we
going to do it? How fast? How much money/resources are we going to spend? How is it going to look like /
function? What kind of features / characteristics is it going to have? What kind of work needs to be done to achieve
the result? Because Project manager’s goal is to collect as much information as possible to formulate Project
Objectives

Who to ask those questions from? Ask them from your stakeholders. You don’t need to come up with Project
Objectives on your own. What kind of creature is this stake-holder and where to find them?
Ex: To replace the Willamette bridge by August 3rd at a cost not to exceed $1.5 million.

***Project objectives vs. project goals

Though some teams may use these interchangeably, there is a distinct difference between project goals vs.
objectives. In general, project goals are higher-level than project objectives. Your project goals should outline what
happens once your project is successful, and how your project aligns with overall business objectives.

Project objectives, on the other hand, are more detailed and specific than project goals. Though many project
objectives may impact business objectives, your project objectives are more focused on your actual, specific
deliverables at the end of the project.

+ Example of a project objective: Add five new ways for customers to find the feedback form in-product
within the next two months.
+ Example of a project goal: Make it easier for the engineering team to receive and respond to customer
feedback.
3. What does it mean if the priorities of a project include Time-constraints, Scope-accept, and
Cost-enhance?
The project must be completed on a specific date (Constrain), the scope can be scaled back in order to meet
cost and time objectives (Accept), and when possible seek opportunities to reduce costs (Enhance).
•Causes of Project Trade-offs
–Shifts in the relative importance of criterions related
to cost, time, and performance parameters
•Budget–Cost
•Schedule–Time
•Performance–Scope
One technique found in practice that is useful for this purpose is completing a
priority matrix for the project to identify which criterion is constrained, which
should be enhanced and can be accepted.

01. Project Management Trade-offs

–Constrain: a parameter is a fixed requirement.

The project must meet the completion date, specifications and scope of the project, or budget

–Enhance: optimizing a criterion over others.

–Accept: reducing (or not meeting) a criterion requirement.

Project Priorities Matrix

•Work Breakdown Structure (WBS)

– Defines the relationship of the final deliverable (the project) to its sub deliverables, and in turn, their
relationships to work packages.
— Best suited for design and build projects that have tangible outcomes rather than process-oriented projects.
The benefits of WBS:
–Facilitates evaluation of cost, time, and technical performance of the organization on a project.

–Provides management with information appropriate

to each organizational level.

–Helps in the development of the organization breakdown structure (OBS). which assigns project
responsibilities to organizational units and individuals

–Helps to plan, schedule, and budget.

–Defines communication channels and assists

in coordinating the various project elements.
4. What kinds of information are included in a work package?
Work packages include the following types of information:
Work to accomplish a segment of the project
Time to accomplish the work package
Time-phased budget for the work package and total cost to complete the work package
Resources needed to complete the work package
Single person responsible for accomplishment of the work package
Monitoring points for measuring progress during implementation of the work package
Any specifications critical to the work package.
5. When would it be appropriate to create a responsibility matrix rather than a full-blown WBS?.
A full-blown WBS or OBS is needed when the scope of the project is large and the size of the project is large.
For small projects with limited scope, an elaborate WBS is not needed as it will increase the cost and time of the
project. On smaller projects where verbal, face-to-face communication is possible, a responsibility matrix should be
adequate. Sometimes a responsibility matrix is used for a segment of a project or one in which a team wishes to
stress responsibility.

6. How does a communication plan benefit the management of projects?

Communication plans help control the flow of information; keep stakeholders informed of information, reduce
confusion, interruptions, and can provide project managers greater autonomy.
By reporting on a regular basis how things are going and what is happening, you allow senior management to feel
more comfortable about letting the team complete the project without interference
WBS:
The WBS defines all the elements of the project in a hierarchical framework and establishes their relationships
to the project end item(s).
As the WBS is developed, organization units and individuals are assigned responsibility for executing work
packages.
Use of the WBS provides the opportunity to “roll up” (sum) the budget and actual costs of the smaller work
packages into larger work elements so that performance can be measured by organization units and work
accomplishment.
Each work package in the WBS
1. Defines work (what).
2. Identifies time to complete a work package (how long).
3. Identifies a time-phased budget to complete a work package (cost).
4. Identifies resources needed to complete a work package (how much).
5. Identifies a single person responsible for units of work (who).
6. Identifies monitoring points for measuring progress (how well).
RESPONSIBILITY MATRIX:
The RM (sometimes called a linear responsibility chart) summarizes the tasks to be accomplished and who is
responsible for what on a project.
Responsible; Support; Consult; Notification; Approval.

Why? Because by reporting on a regular basis how things are going and what is happening, you allow senior
management to feel more comfortable about letting the team complete the project without interference
CÂU HỎI TRÊN QUIZLET
1. What is the Scope Management Plan document?
How the project scope will be defined and validated and how scope will be monitored and
controlled throughout the life of the project.
2. What does the Work Breakdown Structure (WBS) do?
Breaks down the project deliverables into smaller components from which you can estimate task
durations, assign resources, and estimate costs
3. What 4 elements should the Scope Management Plan include?
1) The process you'll use to prepare the scope statement
2) A process for creating, maintaining, and approving the work breakdown structure
3) A definition of how the deliverables will be validated for accuracy and the process used for
accepting deliverables
4) A description of the process for controlling scope change requests, including the procedure for
requesting changes and how to obtain a change request form
4. What are Influences?
Those factors that may impact or change an existing constraint or may bring about a new
constraint.
5. What are 6 common influences?
1) Change request 2) Scope creep 3) Constraint reprioritization 4) Interaction between constraints
5) Stakeholders/Sponsors/Management 6) Other projects
6. What is the Work Breakdown Structure (WBS)?
A deliverables-oriented hierarchy that defines all the work of the project. Each level of the WBS is
a further breakdown of the level above it.

7. What is Decomposition?
The process of breaking down the high-level deliverables (and each successive level of the
WBS) into smaller, more manageable work units. Once the work is broken down to the
lowest level, you can establish time estimates, resource assignments, and cost estimates.
8. How does the Work Breakdown Structure (WBS) support the scope of any given project?
The WBS puts boundaries around the project work because any work not included in the
WBS is considered outside the scope of the project.
9. What 7 things are found in the Scope Statement?
Project description, key deliverables, success and acceptance criteria, exclusions, time and
cost estimates, assumptions, and constraints.

Chapter 5: Estimating Project Times and Costs

1. Why are accurate estimates critical to effective project management?

Estimation is an invaluable tool for anticipating and managing project uncertainties. Accurate project
estimates help identify cost and schedule requirements with relative precision, and reduce the risk of running out of
time, resources, and budget during a project.
Without accurate time and cost estimates project control is ineffective. Inaccurate estimates can make the
difference between profit or loss.

● Time and cost estimates are major inputs to project planning.

● Project control is completely dependent on accuracy of estimates.
● Estimates are needed to support good decisions.
● Estimates are used to determine project duration and cost.
● Estimates are used to develop cash flow needs.
● Estimates are used to develop time-phased budgets and establish the project baseline.
● Absence of estimates results in inaccuracies which result in time and cost under/overruns.
● The activity of estimating reduces error.
2. How does the culture of an organization influence the quality of estimates?
Organization culture can influence project estimates depending on the importance the organization
places on estimating. In some organizations padding estimates is tolerated and even privately encouraged.
Other organizations place a premium on accuracy and strongly discourage estimating gamesmanship.
Organizations vary in the importance they attach to estimates.

Organization culture shapes every dimension of project management. The prevailing belief in some
organization cultures is that detailed estimating takes too much time and is not worth the effort or that it’s
impossible to predict the future.

3. What are the differences between bottom-up and top-down estimating approaches? Under
what conditions would you prefer one over the other?
Top-down estimates are:

1. typically used in the project conceptual phase, and depend on measures such as weight, square feet, ratios.
Top-down methods do not consider individual activity issues and problems.
2. good for rough estimates and can help select and prioritize projects.

Bottom-up time and cost estimates are

1. usually tied directly to the WBS and a work package.

2. made by people familiar with the task, which helps to gain buy-in on the validity of the estimate. Use of
several people should improve the accuracy of the estimate. Bottom-up estimates should be preferred if time
to estimate is available, estimating cost is reasonable, and accuracy is important.

4. What are the major types of costs? Which costs are controllable by the project manager?
There are 2 main types of cost: direct cost and indirect cost

Direct costs include products and tools — such as software — used to complete a project. They are
controllable by the project manager. If the organization must hire individuals to work on the project,
including contractors, related expenses might also fall under direct costs.

Indirect costs may include accounting and payroll, office equipment, utilities, and other overhead
costs already incurred in day-to-day operations. They are only controllable in the sense that if the resource or
project is finished early or late the costs will continue for the duration of the project. Indirect costs can
increase when implementing a new project, so they must be included in the budget.

5. Why is it difficult to estimate mega projects (e.g.,airport, stadium) costs and benefits?
The length of time that is required for the project because complex projects makes it difficult to
accurately forecast costs and user needs. Some of these projects can take years (sometimes, from 2-5 years)
to complete, so unless you buy all of the necessary components in advance or have a way to lock in the price,
then the price of materials may rise.
Second, there will be some unpredictable external factors that seriously affect the progress, quality,
or human resources to complete the project. Example: Storms or natural disasters like tornadoes, hurricanes,
earthquakes and forest fires can damage or destroy the project before completion.
Thirly, the sheer complexity of these kinds of projects make it difficult to accurately estimate all of
the costs. (The sheer scope of the project means that labor and other costs may rise over the time of working
on the project).

6. Define a white elephant in project management. Provide a real-life example.

A white elephant is a burdensome asset, property, or investment whose cost of upkeep is not in line with its
usefulness or value. The term derives from the old Thai custom of gifting rare, expensive-to-keep white elephants to
the reigning monarch. Nowadays it is often associated with unprofitable real estate.
ex: Mega sporting events that leave a trail of run down constructions in their wake are just one example of
white elephants — gigantic, costly projects whose maintenance costs far outweigh the benefits they create

Chapter 6: Developing a Project Schedule

1. How does the WBS differ from the project network?
The WBS differs from the project network in several ways. The WBS is hierarchical while the project network is
sequential. The work packages of the WBS are identified independently of other work packages, have definite start
and finish points, require specific resources, include technical specifications and have cost estimates. Networks
provide the project schedule by identifying dependencies, sequencing, and timing of activities.

2. How are WBS and project networks linked?

Work packages from the WBS are used to build the activities found in the project network. The network uses the
time estimates from the WBS to generate dates for the project. Integration of the WBS and project network is crucial
to effective project management. Project networks depend on the WBS because work packages from the WBS are
used to develop the project network. A network activity can include one or more work packages but all activity time
estimates are derived from the task times in the work package. Unlike the project network, the WBS defines all the
elements of the project in a hierarchical framework and establishes their relationships to project deliverables.

3. Why bother creating a WBS? Why not go straight to a project network and forget the WBS?
The WBS is designed to provide different information for decision making. For example, this database provides
information for the following types of decisions:
a. Link deliverables, organization units, and customer

b. Provide for control

c. Isolate problems to source

d. Track schedule and cost variance. Network doesn’t.

e. Assign responsibility and budgets

f. Focus attention on deliverables

g. Provide information for different levels in the organization.

Project networks depend on the WBS because work packages from the WBS are used to develop the project
network. A network activity can include one or more work packages but all activity time estimates are
derived from the task times in the work package. Unlike the project network, the WBS defines all the
elements of the project in a hierarchical framework and establishes their relationships to project deliverables
4. Why is slack important to the project manager?

Slack helps project managers prioritize tasks so that projects stay on schedule. It also helps them adapt work
when resource availability changes. A flexible timeline decreases team stress and improves morale and
productivity.

In order to succeed, a project manager must understand the differences between tasks that do and do not have
slack. Managers can shift the completion dates for tasks with free or total slack, or reorder them in the
project timeline, without harming the overall project.

This flexibility is important to project managers because it enables them to make the best use of available
resources and prioritize tasks, especially when there aren’t enough resources to do everything at once.

When everyone is aware of slack time, project participants can stay on top of their work and keep project-
related stress levels low. Without understanding slack, team members might see every task as urgent, which
leads to overwork and burnout.

5. What is the difference between free slack and total slack?

Free slack is the amount of time a task can be delayed without affecting the next task. Total slack is the
amount of time a task can be delayed without impacting the delivery of the project.
specifically

Free Slack Total slack

definition Free slack (FS) is unique. It is the The total slack of an activity can be
amount of time an activity can be simply defined as the time, by which
delayed without delaying any the activity can be delayed, without
immediately following (successor) having an impact on the finish date of
activity. Or free slack is the amount of the project.
time an activity can exceed its early
finish date without affecting the early In other words, we can define Total
start date of any successor(s). Free Slack as – “It is the amount of time in
slack can never be negative. Only which schedule activity can be
activities that occur at the end of a delayed or expanded from its starting
chain of activities, where you have a date without delaying the project
merge activity, can have free slack finish date or violating a scheduled
constraint”

We can calculate the free slack (or free The total slack can be calculated by
float) by subtracting the early finish subtracting the early start date of the
date of the current activity, from the activity, from its last date. Or we can
early start of the next activity. So, here also get the total slack by subtracting
is the formula to calculate the free the early finish date of the activity
slack – from its late finish date.

Free Slack = ES(Early Start) Of Total Slack = LS – ES OR Total

Successor – EF(Early finish) of Slack = LF – EF
current activity.
Note: Here ‘LS’ indicate a late start
date, while ‘ES’ indicate to early start
date. Same way ‘LF’ indicate to late
finish date, while ‘EF’ indicate to
early finish date.

In Terms of When we need to discuss flexibility Total Slack gives project-level

Flexibility then Free Slack is the activity-based flexibility, which means here activity
flexibility, whereinto the amount of may be delayed without delaying the
time you can delay the current project project finish date.
activity, without delaying the
successor project’s early start date.

Manner A task with zero Free Slack or Float is Total Slack can be either negative or
considered to be a critical task, in that positive, here if the Total Slack is
case, if a critical task goes delayed negative that means the project is
then the project finish date will also be behind schedule. While if Total Slack
delayed. is positive then it shows that the
amount of time for the activity can be
delayed without delaying the project
finish date.

6. Why are lags used in developing project networks?

To closely represent real situations found in projects. To allow work to be accomplished in parallel when the
finish-to-start relationship is too restrictive. The use of lags has been developed to offer greater flexibility in
network construction. A lag is the minimum amount of time a dependent activity must be delayed to begin or end.
The use of lag in project network occurs primarily for two reasons:
1. When activities of long duration delay the start or finish of successor activities, the network designer
normally breaks the activity into smaller activities to avoid the long delay of the successor activity. Use of lags can
avoid such delays and reduce network detail.
2. Lags can be used to constrain the start and finish of an activity.
The most commonly used relationship extensions are start-to-start, finish-to-finish, and combinations of these
two. These relationship patterns are discussed in this section

7. What is a hammock activity and when is it used?

A hammock activity is a special purpose activity that exists over a segment of the life of the project. A hammock
activity typically uses resources and is handled as an overhead cost—e.g., inspection.

Hammock activities are used to identify overhead resources or costs tied directly to the project. The
hammock duration is determined by the beginning of the first of a string of activities and the ending of the
last activity in the string.

Hammock activities are also used to aggregate sections of projects to avoid project detail—e.g., covering a
whole subnetwork within a project. This approach gives top management an overview of the project by
avoiding detail.

8. How sensitive is the network schedule?

A project schedule is considered sensitive if the critical path will likely change during project execution. The
critical path is simply all the tasks that drive the end date of your project schedule. If your project schedule
has multiple critical paths, then your project schedule is considered sensitive. If your project schedule only
has one critical path and there is slack among the various tasks, then your project schedule is considered
insensitive

PRACTICE:
Question 7: The project information for the custom order project of the Air Control Company is presented here.
Draw a project network for this project. Compute the early and late activity times and slack times. Identify the
critical path.

Question 8: You have signed a contract to build a garage for the Simpsons. You will receive a $500 bonus for
completing the project within 17 working days. The contract also contains a penalty clause in which you will lose
$100 for each day the project takes longer than 17 working days. Draw a project network, given the following
information. Complete the forward and backward pass, compute activity slack, and identify the critical path. Do
you expect to receive a bonus or a penalty on this project?

Question 9: You are creating a customer database for the Hillsboro Hops minor league baseball team. Draw a
project network, given the information in the table that follows. Complete the forward and backward pass, compute
activity slack, and identify the critical path. How long will this project take? How sensitive is the network
schedule? Calculate the free slack and total slack for all noncritical activities.
Chapter 7: Managing Risk
1. Project risks can/cannot be eliminated if the project is carefully planned. Explain.
Project risks cannot be eliminated. It is impossible to be aware of all things that might happen when a project is
being implemented. Risk management attempts to recognize and manage potential and unforeseen trouble spots that
may occur when the project is implemented. Risk management identifies as many risk event as possible (what can go
wrong), minimizes their impact (what can be done about the event before the project begins), manages responses to
events that do materialize (contingency plans), and provides contingency funds to cover risks events that actually
materialize.
=> Undesirable events identified before the project begins can be transferred, retained/reduced, or shared.
Contingency plans with trigger points and responsibilities should be established before the project begins..

2. The chances of risk events occurring and their respective costs increasing change over the project life cycle.
What is the significance of this phenomenon to a project manager?
The chances of risk events and estimated costs changing over the project life cycle are high. These events will
impact project change control mechanisms. Moreover, such changes could be significant enough to require changes
in scope. The project manager must ensure that these changes are recorded and kept updated. Otherwise the
integrity of the project control system will quickly deteriorate and become useless as a management tool.

3. What is the difference between avoiding a risk and retaining a risk?

Avoiding a risk is changing the project plan in advance so as to eliminate specific risks from occurring while
Retaining risk occurs when a conscious decision is made to accept the risk of an event occurring. The risk is retained
by developing a contingency plan to implement if the risk materializes
4. What is the difference between risk mitigation and contingency planning?
Mitigating a risk refers to a very specific strategy of reducing the probability and/or impact of the threat. (taking
action to either reduce the likelihood that a risk (bad event) will happen and/or reduce the impact the risk has on the
project). Contingency planning is an alternative plan that will be used if a possible foreseen risk event becomes a
reality. The contingency plan represents actions that will reduce or mitigate the negative impact if the risk event.
Mitigating is preventive while contingency is reactive.
For example:

Who is
Risk Event Response Contingent Plan Trigger Responsible
Mitigate: Market
observation, research
and analysis on paper
Lack of acceptance to determine whether
by investor of it has potentia; and Make a alternative
project proposal should be pursued design solustion Delay in approval All members
Mitigate: Test
prototype (smart card Work around until Not solve within 24 Hoang Anh
Interface problem system) helps come hours Minh
Mitigate: Restructure
the contract to include
Late delivery for incentives for on-time Deal with alternative Unable to provide
parts delivery. vendor required parts in time Kim Thu
Vender provide
materials and Mitigate: Hold weekly
equipments with meetings with the
design and vendor to ensure Order replacement or
requirement requirements are well deal with alternative Not solve within 24 Truong Quynh
miscommunication understood suppliers hours Anh

Staff do not have Mitigate: Strengthens Employment of new Verification of errors Vu Thu Uyen
control over work,
providing for employees or
sufficient knowledge employees ordering part of work will increase time due
about the subject of consultation with an to another party to the repeated checks
project expert during a contract of work
Build temporary
shelters and
implement
Mitigate: Investing in previously trained More than 2 weeks of
up-front safety risk management unexpected weather
Unexpected weather training methods leading to disruption Minh Hang
Mitigate: Having good
Wear and tear of storage methods for
materials and materials and Correct the cause of The problem happens Kieu Ngoc
equipment equipment the problem frequently Huyen

5. Explain the difference between contingency reserves and management reserves.

Contingency reserves are established to cover identified risks that occur while implementing a project work
package or activity. If the risk does not materialize, the funds are removed from the contingency reserve. And
distributing contingency reserves should be the responsibility of both the project manager and the team members
responsible for implementing the specific segment of the project.
The management reserves are needed to cover major unforeseen risks and applied to the total project. Management
reserves are established after contingency reserves are identified and funds established. These reserves are usually
controlled by top management, the owner (can be internal or external to a project organization, and/or the project
manager. Budget and management reserves are independent of each other.

6. How are the work breakdown structure (WBS) and change control connected?
The WBS and change control are directly linked. Every approved change must be identified and integrated into the
plan of record through changes in the project WBS and baseline schedule. Work breakdown structure details out the
steps that need to be followed to complete the work and it also provides the sequence in which the work is to be
done. In short it is a complete diagram on how the whole process will be completed. Change control is a document
under which any change which is implemented in the project is documented. Now if we see both in conjunction, any
change control measures in the project would lead to change in the WBS of the project. The plan of record serves as
a change management benchmark for future change requests as well as the baseline for evaluating project progress.
The link allows management to trace changes and problems directly to deliverables and the organization unit
responsible.

7. What are the likely outcomes if a change control process is not used? Why?
If the change control system is not integrated with WBS and baseline, project plans and control will soon self-
destruct. The effects of not using change control processes are: Decreased productivity as people become more
expensive with the introduction of changes. Passive resistance festers.

8. What are the major differences between managing negative risks and managing positive risks
(opportunities)?
Positive risks, in contrast, are all those events beyond the company’s control that can help the company, and are
generally exploited to reap the benefit to the project.
Example: When deploying certain technologies to facilitate tasks and reinforce areas within the company, the
organization must consider the risks. Therefore, within the process of investigating and introducing new
technologies, the potential risks (reputational, third-party, cybersecurity, and operational risks) are evaluated against
the benefits they bring.
At the same time, there is an opportunity that technology and tools will be updated with enhanced functionality to
drive efficiencies, mitigate negative risks, and improve communication.
These changes can directly benefit companies that can now take advantage of these new capabilities to increase
productivity.

Negative risks are all those possible events that could harm an organization, where we seek to mitigate, prevent, or
reduce the extent of that harm.
Example: In the same way that there are updates that protect users of particular software, these updates can also
create vulnerabilities if unnoticed by developers and users, with potentially enormous harm if they open a gateway
for cybercriminals.

=> While a company avoids negative risks by delegating tasks or rejecting certain agreements with third parties, it
exploits positive risks by taking actions to increase the chances of those uncertain events.
While positive risks are shared to capitalize on a positive impact that another branch can leverage, negative risks are
transferred to others who are better suited to respond or mitigate the harm.
When a positive event occurs, the aim is to leverage its effects and take advantage of them as much as possible for
the organization’s benefit. In contrast, in a negative event, there are strategies to mitigate the harm. In both cases, the
risks that cannot be influenced or modified are accepted, from which an organization can learn for future occasions.
(Essentially the same process that is used to manage negative risks is applied to positive risks. The major differences
occur in the responses. Instead of avoiding negative risks, project managers often try to exploit positive risks by
taking action to ensure that the opportunity occurs. Instead of transferring risks to another party, project managers
often share positive risks to increase the likelihood the opportunity can be exploited. Instead of mitigating negative
risks, project managers will take action to enhance the likelihood the opportunity will occur and/or increase the
positive impact of the opportunity. Finally, project managers will often choose to accept both negative and positive
risks, but be prepared to respond if either occurs.)

Chapter 8: SCHEDULING RESOURCES AND COST:

1. The heuristics approach is applied for? -
- Projects having resources that are not adequate to meet peak demands
- Resource-constrained projects
2. Why does the project team need to schedule resources?
- Because resources are not adequate to meet peak demands
- Because the demand for resources varies widely over the life of the project
3. Resource smoothing process is applied for?
- Projects having demand for resources that varies widely over the life of the project
- Time-constrained projects
4. When scheduling resources, the three priority rules, including Minimum slack; Smallest duration;
Lowest activity identification, are applied for?
- Projects having resources that are not adequate to meet peak demands
- Resource-constrained projects

Bài tập : vẽ network và bảng schedule for resource (cái cuối cùng hoàn thành)
# rules:
1. Minimize slacks
2. Smallest duration
3. minimi
1. How does resource scheduling tie to project priority?
Project priority refers to the order in which a team completes projects, according to some overriding
enterprise-level mission. Resource scheduling ties into project priority by providing the people, spaces, equipment,
and materials when the current system of task prioritization calls for them.
Resources should become available in the right quantity as dictated by the stage of the project. Getting this
balance right allows businesses to achieve higher profitability, customer satisfaction, and avoid bottlenecks that
reduce productivity.
2. How does resources scheduling reduce flexibility in managing projects?
Resource scheduling imposes constraints on operations: the regime locks team members down to perform
specific functions at particular times. They can’t use their initiative to complete tasks without previous preparation
because doing so risks disrupting a carefully-calculated workflow.
Resource leveling (where managers schedule the people or equipment for particular time slots) by tying down
resources, companies increase the number of critical or near-critical activities. And that raises possible points of
failure, potentially derailing the entire project. Less slack means less room to maneuver.
Resource-level scheduling is a different aspect. Here, time is the flexible variable. The company does the best it can
to meet deadlines using whatever resources are available. Internal and external resources determine the timing of
project milestones. For instance, a company might have venture capital funding to launch a project. Its job is to
deploy scarce resources as efficiently as possible to deliver the desired output. Resource-level planning, however,
can still cut into flexibility and lead to misallocation. Over-supplying resources leads to waste while undersupplying
them contributes to bottlenecks. Therefore overzealous scheduling leads to more critical activities, increasing the risk
of projects stalling.
Resource scheduling, therefore, can reduce flexibility.

3. Present six reasons scheduling resources is an important task.

Clearly, there are good reasons for companies to deploy resource scheduling. It allows them to:

● Determine whether they have sufficient resources to address the project priorities
● Work out whether a specific project duration is realistic
● Thrash out the critical path of the project, determining how resources need to come together, and
when
● Decide which resources have priority and then create contingent tasks
● Determine whether the business can complete all tasks in-house, or whether it must use contractors
● See how much slack they have, and how likely it is that a project will consume it
Ultimately, effective resource scheduling allows businesses to make more efficient use of people, equipment,
time, and locations. It has proven value countless times in the past, but there are costs to flexibility. The task
for us is to reduce or eliminate the flexibility costs of using it. Companies need a win-win solution.

4. How can outsourcing project work alleviate the three most common problems associated with multi project
resource scheduling?
The three most common problems associated with multi project resource scheduling are overall schedule slippage,
inefficient resource allocation and resource bottlenecks. Outsourcing can alleviate the problems in the following
ways by allowing companies to hire temporary workers to expedite certain activities that are falling behind schedule
or to overcome internal resource deficiencies. The latter can include peak periods when insufficient internal
resources are not available to meet the demands of all projects.
For example, project delays can be avoided by contracting key activities when resources are not available internally.
Likewise, hiring consultants to help with Y2K problems allows critical IT people to work on specific problems,
while the outsiders work on standard programs. Not only does the project get done on time, but the company avoids
hiring IT personnel to meet a short term need

5. Explain the risks associated with leveling resources, compressing or crashing projects, and imposed
durations or “catch-up” as the project is being implemented.
Leveling resources, compressing or crashing projects, and imposed durations or “catch-up” are project scheduling
tools that carry risk.
• Leveling resources attempts to even out demand resources by delaying non-critical activities using slack to increase
resource utilization. Delaying non-critical activities carries the potential to delay the overall project since delayed
activities may affect critical path activities.
• Compressing is a technique in which the previously determined schedule is shortened in a manner that does not
reduce the project scope. The risks of schedule compressing are time overrun and the possibility that one or more
activities in the network may have to be eliminated.
• Crashing entails adding more resources to activities on the critical path with the objective of completing the project
earlier. Shifting resources can lead to a reduction of time so that the critical path is as short as possible. Crashing
carries the risk of budget overruns and poor quality
=> Flexibility is decreased and risk of delay is increased. For example, slack is used up and may cause other
bottlenecks later in a sequence of activities. Having time buffers at merge points before the project begins could
help avoid some of the need to crash activities. Decoupling critical activities can help to cut time if decoupling is
possible and resources can be shifted; however, the risk is typically reduced only slightly.

6. Why is it critical to develop a time-phased baseline?

It is critical to develop a time-phased budget because they are necessary for good project schedule and cost control.
The importance of a time-phased budget is to ensure the money is available when the team needs to spend it. The
baseline budget tracks cash flow – not when the project team gets a bill but when the company has to disburse
money to pay vendors, consultants or marketers. Without a timeline, you could get caught short with no cash on
hand when payment is due. Time-phasing cost to match project schedule is a prerequisite to having reliable
information for control purposes
The time-phased aspect is important for other reasons:
If you need to borrow money for the project, the time-phased baseline budget explains why.
Project planning compares project cost to the project's value. Knowing when you need to spend cash helps figure out
the cost.
It helps you break down and explain the amounts you're committed to spend, the actual payments and spending
approvals.

Question 6:

Question 4: Given the network plan that follows, compute the early, late, and slack times. What is the project
duration? Using any approach you wish (e.g., trial and error), develop a loading chart for resource, electrical
engineers (EE), and resource, mechanical engineers (ME). Assume only one of each resource exists. Given your
resource schedule, compute the early, late, and slack times for your project. Which activities are now critical? What
is the project duration now? Could something like this happen in real projects?
Question 5: Given the network plan that follows, compute the early, late, and slack times. What is the project
duration? Using any approach you wish (e.g., trial and error), develop a loading chart for resources carpenters (C)
and electricians (E). Assume only one carpenter is available and two electricians are available. Given your
resource schedule, compute the early, late, and slack times for your project. Which activities are now critical? What
is the project duration now?

Question 7: You have prepared the following schedule for a project in which the key resource is a tractor(s). * There
are three tractors available to the project. Activities A and D require one tractor to complete, while activities B, C, E,
and F require two tractors. Develop a resource-constrained schedule in the loading chart that follows. Use the
parallel method and heuristics given. Be sure to update each period as the computer would do. Record the early start
(ES), late finish (LF), and slack (SL) for the new schedule
Question 14: Given the time-phased work packages and network, complete the baseline page 298 budget form for
the project.

cumulative là tổng tích lũy từng period

Chapter 9: REDUCING PROJECT DURATION

Bài tập tính optimum time:

1. What Are Five Common Reasons For Crashing A Project? K hỏi

1. Project Schedule Delay
If the project is falling behind schedule, you don’t have many courses of action to ensure its completion within time
limits. That is especially important if you or your company face penalties due to unforeseeable delays.
2. Resource Availability
If more resources become available, you might decide to allocate them to a certain project and finish it ahead of
schedule. Depending on the situation, schedule crashing can require additional finances, assigning new people to the
project, or any other relevant extra assets.
3. Avoiding Future Delays
In many cases, if one of your projects is behind schedule, it can cause future delays and impact the completion of
another task. To avoid that, you can crash one project to ensure the completion of multiple others within the set time
limits.
4. Time Bonuses
While some companies may impose penalties for a project delay, others may reward completion before the set date.
If that is the case, you should calculate the cost of expediting and determine whether spending extra is financially
beneficial to you in the long run.
5. Extra Manpower
Companies often onboard new members or train them for a specific position. Sometimes, you may use new hires and
assign them on a project until they complete their training and crash the project with an additional workforce.

2. What are the advantages and disadvantages of reducing project scope to accelerate a project? What can be
done to reduce the disadvantages?
(The advantages to reducing project scope to accelerate a project are that time and cost may be reduced.
Disadvantages include the fact that functionality is lost and the value of the project reduced. These disadvantages can
be minimized by an intense re-examination of requirements with stakeholders to determine which features are
essential. This “may actually improve the value of the project by getting it done more quickly and for a lower cost )
Or:
The reduction in project scope is done by crashing activities to enable project managers to accelerate the
project to reduce time. This can be done by working overtime, outsourcing, and housing resources that are time-
savers to the project. Crashing activities will shorten the duration of the project. Therefore, projects can meet the
established deadlines or finish earlier than the time originally planned. Furthermore, another advantage is that it
spoke the budget needed to complete the project as it studied some tasks within the project. On the other hand,
reducing the project scope is a risk as it can have detrimental effects. The Project can lose functionality which will
therefore reduce the value and quality of it,resulting in failure to meet the requirements initially defined.
However, the disadvantages can be minimized by monitoring and re-assessments of requirements to determine
essential features. This will ensure that the adaptation of the projects functions to maintain and quality. Thus, it will
also increase project costs. Overall, there are advantages and disadvantages influenced by three project
parameters(cost, schedule and technical performance) which can greatly affect the perceived success or failure of the
project.
Consequently, managers need to carefully evaluate their decision on whether to crash activities to accelerate
the project and ensure that they can adapt to all possible outcomes

3. Why is scheduling overtime a popular choice for getting projects back on schedule? What are the potential
problems of relying on this option?
Scheduling overtime is a popular choice for accelerating project completion because it avoids the additional
costs of coordination and communication encountered when new people are added to a project. Additionally, there
may be fewer distractions when working outside of normal business hours and, if the people working overtime are
salaried workers, there may not be any real additional cost for the extra work.
Potential problems with relying on overtime include the increased costs when using hourly workers. Overtime
for salaried workers may result in reduced productivity, lower employee satisfaction, burnout or turnover.
4. Identify four indirect costs you might find on a moderately complex project. Why are these costs classified
as indirect?
Indirect costs that might be found on a moderately complex project include supervision, administration,
consultants, and interest. These costs are classified as indirect because they cannot be associated with any
particular work package or activity. Indirect costs vary directly with time. Any reduction in time should result in a
reduction of indirect costs. For example, if the daily cost for supervision and administration are $2,000, any
reduction in project duration would represent a savings of $2,000 per day (assuming that the indirect resources can
be utilized elsewhere).

5. How can a cost-duration graph be used by the project manager? Explain.

Cost-duration graphs allow the project manager to identify “the costs of reducing project time so that
comparisons can be made with the benefits of getting the project completed sooner” (p. 288). Basically, managers
need to look for critical activities that can be shortened with the smallest increase in cost per unit of time.
The rationale for selecting critical activities depends on identifying the activity’s normal and crash times and
corresponding costs. Normal time for an activity represents low-cost, realistic, efficient methods for completing the
activity under normal conditions. These graphs require gathering direct and indirect costs for specific project
duration which can help highlight and search critical activities to find the lowest direct-cost activities that will
shorten project duration.
=> Knowing the slope of activities allows managers to compare which critical activities to shorten. The less
steep the cost slope of an activity, the less it costs to shorten one time period; a steeper slope means it will cost more
to shorten one time unit
6. Reducing the project duration increases the risk of being late. Explain.
Reducing the project duration increases the risk of being late because reducing the slack of noncritical
activities increases the likelihood(=probability) of creating new critical paths. More critical paths increase the risk of
the project being late.
In addition, compressing will have the following other impacts on managing the project:
● Reduces flexibility by using slack
● Can increase the number of critical activities
● Can increase interdependencies of paths
● Makes resource scheduling tighter (critical)
● May increase costs

7. It is possible to shorten the critical path and save money. Explain how.
Shortening the critical path can save money in instances where indirect costs are a significant percentage of
total project costs. A shorter project means these costs are incurred for less time.
One reason that this is possible is due to the inverse relationship of direct cost and indirect costs. That is, an
increase in project duration usually means a lowering of direct costs and an increase in indirect costs. An analysis
can determine the optimum (lowest) total cost as the project duration time is reduced. Individual activities are
shortened in order to achieve the lower total duration (which sometimes results in the creation of additional critical
paths). However, the total cost vs. project duration can be considered parabolic - this is, because the direct costs are
curvilinear while indirect costs are fairly linear. In other words, you can only shorten activities and reduce a certain
extent before the time/cost reduction effect reverses itself.
PRACTICE:
Cost slope= (Crash cost - Normal cost) / (Normal time - Crash time)
Question 4: Given the data and information that follow, compute the total direct cost for each project duration. If the
indirect costs for each project duration are $90 (15 time units), $70 (14), $50 (13), $40 (12), and $30 (11), compute
the total project cost for each duration. What is the optimum cost-time schedule for the project? What is this cost?

Question 5: Use the following information to compress one time unit per move using the page 341 least-cost
method. Assume the total indirect cost for the project is $700 and there is a savings of $50 per time unit reduced.
Record the total direct, indirect, and project costs for each duration. What is the optimum cost-time schedule for the
project? What is the cost? Note: The correct normal project duration and total direct cost are provided.
Question 6: If the indirect costs for each duration are $300 for 27 days, $240 for 26 days, $180 for page 342 25
days, $120 for 24 days, $60 for 23 days, and $50 for 22 days, compute the direct, indirect, and total costs for each
duration. What is the optimum cost-time schedule? The customer offers you $10 for every day you shorten the
project from your original network. Would you take it? If so, for how many days?

Question 7: Use the following information to compress one time unit per move using the least-cost method. Assume
the total indirect cost for the project is $2,000 and there is a savings of $100 per time unit reduced. Calculate the
total direct, indirect, and project costs for each duration. Plot these costs on a graph. What is the optimum cost time
schedule for the project? Note: The correct normal project duration and total direct cost are provided

Chapter 13: Progress and Performance Measurement and Evaluation

Câu hỏi bổ sung:
What does the Project Monitoring Information System show? What is it used for?
1. What data to collect
2. How, when, and who will collect the data
3. Analysis of the data
4.Reporting current progress

What costs are included in a baseline?

Labor, equipment, and materials (direct costs that can be controlled)

What is true of the project baseline?

Customers should not request scope changes. Changes should only occur after a work package is
complete. Natural disasters can force a baseline change.

Benefit of Earned Value Management?

Provides for accountability over individual portions of the overall budget for each organization unit.
Measures accomplishments against plan and deliverables. Provides a method for tracking directly to
a problem work package and organization unit responsible. Alerts all stakeholders to early
identification of problems and allows for quick, proactive corrective action.
1. How does a tracking Gantt chart help communicate project progress?
Tracking Gantt chart assists in progress monitoring by providing a live comparison between activity completions and
the baseline plan. In addition, it revised the critical chain in accordance with the actual progress and set up a new
bottleneck process. The purpose of these is to modify the progress in such a way that it crashes the revised schedule
and helps the project to be completed on time

2. How does earned value give a clearer picture of project schedule and cost status than a simple plan versus
actual system?
The earned value is the relationship between schedule and actual cost in accordance with the planned schedule. A
project's schedule is therefore connected with its cost of completion, which is the main goal. As a result, the impact
of delay and cost overrun can be better understood.

3. Schedule variance (SV) is in dollars and does not directly represent time. page 504 Why is it still useful?
SV gives a project view of how well all of the scheduled activities are meeting planned dates. Research shows that
after twenty percent of a large project is complete, SV is a relatively good indicator of schedule performance (even
though it is in dollars or labor hours).

4. How would project managers use the CPI?

The cost performance index (EV/AC) is a popular index. An index of .60 indicates that 60 cents of work has been
completed for each actual dollar spent. This would suggest to the project manager that the project will be over
budget or big savings in remaining work will be needed to bring the project in on budget.

5. What are the differences between BAC and EAC?

BAC is the planned budget at completion. EAC is the estimate at completion. EAC can be calculated two ways. First
is simply by formula, which is used in software programs; the formula applies a performance ratio from past work on
the project to the remaining work for an EAC. A second method uses new cost estimates that have been made by
project participants concerning specific work packages; these new estimates are then factored into the EAC.

6. Why is it important for project managers to resist changes to the project baseline? Under what conditions
would a project manager make changes to a baseline? When would a project manager not allow changes to a
baseline?
Changes to the baseline of a project are usually resisted by project managers because if they occur once, they are
likely to occur again. It is also difficult to change the project baseline without obtaining the consent of the client
(who may or may not be understanding) and the stakeholders. A change in the baseline will almost certainly impact
the project's costs, time, and scope (for the worse). If the baseline change is re-negotiated and approved without any
benefit to the vendor (company working on the project), then the client may be tempted to make more changes to the
project manager. This could lead to a further baseline change. As a mechanism for tracking progress and tracing
back to the problem, the baseline's value and integrity can be undermined by constant changes. In order to prevent
changes in baselines from becoming a problem, changes should only be made to major scopes.