Learning Objectives

1. Understand types of project costs and their differences.

2. Learn cost estimation methods like ballpark, definitive, and parametric estimates.
3. Understand budgeting techniques like top-down, bottom-up, and time-phased
approaches.
4. Recognize when to use contingency funds for better cost planning.

Key Concepts in Cost Management

 Cost Management: Involves collecting, tracking, and controlling costs.

 Cost Accounting & Control: Ensures project expenses stay under control.
 Cost Estimation: Sets a realistic budget baseline.

Sources of Costs

 Labor: Salaries or wages.

 Materials: Supplies needed for the project.
 Subcontractors: Outsourced services.
 Equipment & Facilities: Tools and spaces.
 Travel: Expenses for team mobility.

Types of Costs

1. Direct vs. Indirect: Direct are tied to specific activities; indirect support the overall
project.
2. Recurring vs. Nonrecurring: Recurring happen repeatedly, while nonrecurring are
one-time.
3. Fixed vs. Variable: Fixed don't change with volume; variable costs depend on usage.
4. Normal vs. Expedited: Normal are standard rates; expedited are higher due to
urgency.

Cost Estimation Methods

 Ballpark Estimates: Rough, early guesses.

 Comparative Estimates: Based on similar projects.
 Feasibility Estimates: Check if the project is viable.
 Definitive Estimates: Detailed and accurate.
 Learning Curves: Predict efficiency improvement as output increases.
Software Cost Estimation

 Function Point Analysis: Measures software size based on features.

 Complexity Weighting: Assigns effort levels to tasks.

Challenges in Estimation

 Unrealistic initial figures.

 Technical difficulties.
 Incomplete project definitions.
 Changing requirements.
 External factors like market conditions.

Creating a Project Budget

 Combines Work Breakdown Structure (WBS), scheduling, and costs.

 Methods:
o Top-down: Starts with overall budget and allocates to components.
o Bottom-up: Builds the budget from detailed tasks.
o Activity-Based Costing (ABC): Links costs to specific activities.

Budget Contingencies

 Adds extra funds to handle uncertainties.

 Useful for:
o Changes in project scope.
o Unexpected challenges.
o Interaction and overhead costs.

Benefits of Contingency Funds

 Prepare for unknowns.

 Track potential cost overruns early.
 Ensure smooth completion of projects despite challenges.

Summary

To manage costs effectively:

  Classify and estimate costs accurately.
 Use suitable budgeting methods.
 Include contingencies for unforeseen issues.

Here’s a simple summary of the main topics in your document, which is about Project
Scheduling in project management:

1. Why Project Scheduling is Important

 Scheduling helps plan tasks, organize resources, and ensure the project is completed
on time.
 It connects activities with timelines, resources, and milestones.

2. Key Terms in Project Scheduling

 Project Network Diagram: A map of activities and their relationships.

 Critical Path: The longest sequence of tasks that determines the project’s minimum
duration.
 Float: Extra time an activity can have without delaying the project.
 Forward Pass/Backward Pass: Methods to calculate earliest and latest start/finish
dates for tasks.

3. Activity Relationships

 Predecessors: Tasks that need to finish before others start.

 Successors: Tasks that follow after predecessors.
 Merge Activity: Where multiple tasks must finish before another starts.
 Burst Activity: A task that leads to multiple follow-up tasks.

4. Developing Activity Networks

 Two techniques for diagramming tasks:

o Activity-on-Node (AON): Activities are shown as boxes (nodes).
o Activity-on-Arrow (AOA): Activities are shown as arrows.
 Activities can be serial (done in sequence) or concurrent (done in parallel).

5. Estimating Activity Durations

  Use expert opinions or mathematical methods (like beta distribution).
 Durations are based on:
o Most likely time (m)
o Optimistic time (a)
o Pessimistic time (b)

6. Critical Path Method (CPM)

 Helps identify the longest duration path in the project.

 Steps:
o Forward Pass: Calculate early start/finish dates.
o Backward Pass: Calculate late start/finish dates.
 The critical path shows tasks that can’t be delayed without impacting the whole
project.

7. Shortening the Project Timeline

Options include:

 Removing unnecessary tasks.

 Running tasks in parallel instead of sequentially.
 Reducing the time for critical tasks.

Here’s a simple summary of the main topics from your second document, which focuses
on Project Scheduling: Lagging, Crashing, and Activity Networks:

1. Lags in Project Activities

 Lag refers to delays between tasks and can define how tasks relate to each other.
 Four types of lag relationships:
o Finish-to-Start (FS): A task starts only after another finishes (most common).
o Finish-to-Finish (FF): Two tasks finish at the same time.
o Start-to-Start (SS): Two tasks start simultaneously.
o Start-to-Finish (SF): The least common; one task’s finish depends on
another's start.

2. Gantt Charts

 What They Are: Visual timelines showing project activities and their durations.
  Benefits:
o Easy to understand and use for tracking progress.
o Highlights the critical path and resource needs.
o Allows for updates and monitoring.
 Example: Gantt charts can include task durations, resources, and lag relationships.

3. Crashing a Project

 Crashing means speeding up a project to finish earlier.

 Methods to crash a project:
o Improve efficiency or productivity.
o Work overtime or add more resources.
o Overlap tasks (fast-tracking).
o Reduce project scope or quality (if necessary).
 Costs and Trade-offs:
o Crashing increases costs, so it's done only when justified.
o The process stops once the desired time or budget is reached.

4. Activity-on-Arrow (AOA) Networks

 What They Are: A diagram method where tasks are shown as arrows and events as
nodes.
 Key Features:
o Forward and backward pass logic (like AON).
o May require “dummy activities” to connect dependencies properly.
 Widely used in construction projects.

5. Controversies in Project Networks

 Challenges:
o Networks can be overly complex and hard to manage.
o Poorly constructed networks create confusion.
o Contractors might create biased networks, especially in PERT.
 Key Takeaway: Simplicity and accuracy in project networks are crucial to avoid
problems.

Summary of Learning Objectives

 Understand lag relationships and use them in schedules.

 Create and interpret Gantt charts.
 Use crashing techniques to shorten project timelines.
  Build Activity-on-Arrow (AOA) networks.
 Address issues in project network management.

1. Agile Project Management (Agile PM)

Why Agile?

 Traditional planning assumes the project plan will remain fixed, but in reality,
customer needs often change during the project.
 Agile PM is designed for projects where flexibility is essential, such as software
development.
 It focuses on adapting to change rather than rigidly following the initial plan.

How Agile Works

 Agile divides work into short cycles called Sprints, where the team plans, executes,
and reviews progress iteratively.
 The process involves:
1. Planning: Define goals for a sprint.
2. Daily Scrums: Short team meetings to assess progress.
3. Development Work: Execution of tasks.
4. Sprint Review: Feedback from stakeholders.
5. Retrospective: Evaluate the sprint for improvements.

Key Roles in Agile

 Scrum Master: Ensures the team stays on track and removes obstacles.
 Product Owner: Represents the stakeholders and prioritizes tasks.
 Development Team: Delivers a working product increment after each sprint.

Challenges with Agile

 Requires close collaboration, which may not always be possible.

 Evolving requirements can lead to scope creep (the project grows beyond its original
goals).
 It's harder to predict what the final product will look like early in the project.
 Testing throughout the project can increase costs.

Keys to Success in Agile

 Empowered and cross-functional teams.

 Shared accountability among team members.
 Early feedback and rapid risk reduction.
2. Extreme Programming (XP)

 What is XP?
o A specialized form of Agile for software development.
o It emphasizes delivering high-quality software quickly.
 Key Practices in XP:

1. Refactoring: Constantly improving the design of the code.

2. Pair Programming: Two developers working together to ensure quality.

 Advantages:
o The entire process is transparent and accountable.
o Combines Agile principles with the discipline of project management.

3. Critical Chain Project Management (CCPM)

What is CCPM?

 A project scheduling method developed by Eli Goldratt based on the Theory of

Constraints (TOC).
 Focuses on:
o Efficient use of resources.
o Reducing project delays caused by resource bottlenecks.

Theory of Constraints (TOC)

 Every system has a constraint that limits its performance. The steps to manage
constraints are:
1. Identify the constraint.
2. Exploit the constraint (make it as productive as possible).
3. Subordinate everything else to the constraint.
4. Elevate the constraint (add more resources, if necessary).
5. Repeat the process for other constraints.

Buffers in CCPM

 Buffers are added to schedules to absorb uncertainty and avoid delays:

o Project Buffer: Protects the project’s final deadline.
o Feeder Buffers: Prevent delays in non-critical tasks from affecting the critical
chain.
o Drum Buffers: Prevent critical resources from running out of work.

How CCPM Differs from Critical Path (CPM)

 Critical Path focuses on task dependencies and calculates the longest timeline to
complete the project.
  Critical Chain adds resource availability and buffers to handle uncertainty, making it
more realistic for resource-constrained projects.

4. Using CCPM for Resource Conflicts

 CCPM helps resolve conflicts by delaying non-critical tasks until the latest possible
time.
 When multiple projects share resources, Capacity Constraint Buffers (CCB) are used
to manage the overlaps between projects.

5. Challenges and Criticisms of CCPM

 No Milestones: CCPM doesn’t focus on traditional project milestones.

 Anecdotal Evidence: Lacks solid, widespread data to support its effectiveness.
 Cultural Barriers: Requires significant mindset changes within organizations.
 Overestimation Issues: Critics argue CCPM overestimates task durations.

Summary

 Agile PM focuses on flexibility and iterative progress.

 Extreme Programming (XP) is a focused Agile approach for software development.
 CCPM is a resource-driven scheduling approach that uses buffers to minimize delays
and improve project timelines.

Here's a detailed explanation of the topics discussed in the provided PowerPoint files in
simple language:

Week 13a (Resource Management)(Week 13a (1))

1. Constraints in Projects
Projects face limitations like physical (equipment), time (deadlines), and resource (personnel
and material) constraints. These make planning and scheduling challenging.

2. Resource Loading

 It’s about how much resources (like people or materials) are needed for tasks at
specific times.
 A resource usage table shows team members, their tasks, and expected time for
completion.
3. Resource Leveling

 This process ensures that resources are used efficiently without overburdening or
underusing them.
 Prioritization techniques, like focusing on tasks with the least flexibility, help in
leveling resources.

4. Multiproject Resource Management

In environments where multiple projects run simultaneously, resource allocation considers:

 Which project needs the most resources.

 Which has the most urgent deadlines.

Week 13b (Project Evaluation and Control)(Week 13b (1))

1. Control Cycle

 A process to monitor and manage a project: set goals, track progress, compare results
with plans, and take corrective actions.

2. Earned Value Management (EVM)

 A method to assess project health by tracking schedule, cost, and performance

together.
 Key terms include:
o Planned Value (PV): Expected cost of planned tasks.
o Earned Value (EV): Value of work actually completed.
o Actual Cost (AC): What was spent so far.
o Variance: Differences between planned and actual performance.

3. Milestone Analysis
Milestones are major points in a project, like completing a phase. They help:

 Motivate teams.
 Check progress and adjust plans.

4. Human Factors
Behavioral and interpersonal issues like coordination and stakeholder relationships also
influence project evaluation.

Week 14 (Project Closeout and Termination)(Week 14 (1))

1. Forms of Project Termination

 Extinction: Project completed and goals met.

  Addition: Project becomes part of the organization.
 Integration: Project outcomes are merged into existing operations.
 Starvation: Project ends due to lack of resources or interest.

2. Closeout Process
Finalizing a project involves:

 Completing tasks.
 Handover to the client.
 Reviewing and documenting lessons learned.

3. Challenges in Closing Projects

Common problems include:

 Low priority for closure tasks.

 Teams skipping analysis of lessons learned.
 Emotional or intellectual issues among team members or clients.

4. Final Report
A comprehensive summary includes:

 Performance of the project and team.

 Benefits achieved.
 Suggestions for future improvements.

5. Protecting Against Claims

To avoid disputes, keep clear records, communicate risks, and document changes.