Project management

Module-III

Project control
It is the process of keeping the project on target and as close to the project plan feasibly as possible. It is often very difficult to tell where planning stops and control begins

Project Control
Project control is the process of keeping the project on target, and as close to the project plan as feasibly possible. It is often very difficult to tell where planning stops and control begins. An effective project control system performs as any control should- tracking, monitoring and prodding the project towards its ultimate goals of time, cost and performance. The control process is concerned with assessing actual against planned technical accomplishments, reviewing and verifying the validity of technical objectives, confirming the continued need for the project, timing it to concide with operational requirements, overseeing resource expenditures and comparing the anticipated value with cost incurred.

Differences between project planning and project control

SL NO. 1. 2. 3. 4. 5. 6. ITEM
Action Goals Resources Problems Motivation

PROJECT PLANNING
Anticipates action Set the goal and direction Allocates the resources Anticipates the problems Motivates the participants to achieve the goals Proactive

PROJECT CONTROL
Initiates action Guides the work towards the goal Ensures effective,on-going utilization of the resources Corrects the problems Rewards the achievements of the goals Reactive

Type of process

Phases in project control

Setting the performance standard Comparing actual performance with the standard performance Taking corrective action

Setting the performance standard

The expected performance standards are to be defined It should be expressed in terms of technical specifications, the budgeted cost,schedules,and the resource requirements of the project Theses standards are derived from the users requirement, project plan Define cost, schedules and technical factors and also boundaries are well defined.

Comparing actual performance

The control expenditure and the work in the project are compared to the budgets and the schedules prepared in the first phase. Make the estimate of time and cost of the work still remaining are estimated

Taking corrective action

Whenever the actual performance in the project deviates significantly from the standard, then the project work has to be altered or the plans have to be revised(if necessary) When the work performance is deficient, the resources are added, shifted/altered

Basic model of control system

feedback

I/P

o/p

Basic requirements of control system

Defining the system characteristics of importance Eg. Time,cost and quality Defining the limits to their Variation Measurement of Characteristics I. The timing of observation II. Speed of reaction to the situation ie. Time delay in receiving information/implimenting action

IV. Making progress visible and feedback of performance V. Taking Corrective action (After finding any deviation from what you expected)

Distanc e from the centre

Time Fig(1) Instability

Desired points

Fig.2 stable system

Control of major constraints

1. Quality Project manager has two roles in the quality control a) concern for the conformance of the product and process to agreements. b) Performance of the delivery. Conformance The establishment of effective system to control the quality of product/services increases the importance of project management.

Quality system contains

1.Policies 2.Procedures 3.System discription

Objectives of the Quality Control System

To provide a formalised system within the pjct system,to ensure the needs of customers and make sure that they are continuously being met. Through the quality system, the organisation demonstrate that it has taken very reasonable precaution to ensure the stated needs were met

It is a prerequisite for obtaining business in many markets such as aerospace, defense, motor industry etc. It ensures the quality by considering not only the O/P product but also the process by which that O/P is delivered.

Performance
The expectations and perceptions of the customer have been identified and achieve customer satisfaction and retain the customers. There are two issues related with performance

Dont create expectations that can not be delivered Measure the expectation and perception at right time

COST and TIME

The role of the project manager in the cost control are:

Setting up the cost control system in conjunction with the needs and recommendations of financial dept. Allocating responsibilities for administration and analysis of financial data. Ensuring costs are allocated properly. Ensuring the contractors payments

 Check out other projects are not using your budget. Calculating the sunk cost-it is the measure of what has been spent to a particular point of time.

The earned value method

It controls cost over runs The earned value brings together time and cost performance into a monetary qty.(easily understandable qty) The first stage in the earned value assessment process is :set a budget for each of activities of the project. Second stage:The measurement earned value takes place this gives a solution to the project manager for answering the question how it is going

Third stage: Here we are considering time performance .To do this we can compare the earned value with the planned spend at that point in time. The ratio of these two factors gives the schedule performance indicator Original performanceindicator Fourth stage Cost performanceindicator Estimated cost at completion= Similarly we can calculate, Original time esimate SchedulePerfomance Estimated time of completion=

Cntd
Cost over runs: eg.80% of the project is completed, but at that time but 95% budget is utilised for 80% completion, Now cost is over runed; erned value method is the solution for it

IST STAGE, SET A BUDGET

ACTIVITY 1 2 3 4 5 6 7 TIME 1wk 1wk 1wk 1wk 1wk 1wk 1wk BUDGET 5000 8000 7000 12000 14000 10000 13000

8
9 10 TOTAL

1wk
1wk 1wk 10 wks

11000
16000 4000 100,000

STAGE-2 MEASUREMENT OF EARNED VALUE

In this eg.we consider the progress of 5 th week ,Suppose after 5 weeks the activities completed are 1-4, Amount spent Rs.36000 The target for completing the activities is 5. The amount allocated is 5000+8000+7000+12000+14000=460 00. But we have spent only Rs.36000

Planned spent is Rs. 46000 Actual spent Rs. 36000 That means the project is running Rs. 10000 underbudget According to the earned value method sum of the budgets for completed activities is 5000+8000+7000+12000= Rs.32000. Hence actual spent = Rs.36000. Planned spent=Rs.46000 Earned value= Rs. 32000

We can find out cost perfomance indicator=earned value/actual spent Rs.32000/Rs.36000=0.889 STAGE 3 Now we can consider the time perfomance so the variance=4600032000=14000 Hence the schedule perfomance indicator=earned value/planned spent

SPI=32000/46000=.696 STAGE-4 Estimated cost at completion =Original cost/Cost performance indicator =100000/0.889=1,12,500 Similarly We can find out the time of completion=Original time estimate/Schedule performance indicator =10 wks/.696=14.4 weeks

Real time control

Making reports on the progress of work on several times a day and data is fed to CPU and added to the data other activities. The result is fed back to users which give an opportunity to take corrective measures. 2. Placing a white board on the centre of the area in which project team is working.-on going activities are listed and as and when completed the
1.

Technical Performance monitoring

It can provide an objective and visible means of comparing the actual performance to the planned/predicted performance .This is part of the regular project review.

Project Management software and Information system

1.

2.

Computers are being widely used for problem solving and decision making in the business and industries. The computerized software packages fulfill the specific requirements of project management.

Advantages of computerised PMS

Speed Capacity Efficiency Economically feasible Ability to handle Complexity

Drawbacks
Chances of threatening Selecting the right and suitable PMS is difficult because the availability of PMS are high. Different PMS offers different Services, the project managers should select the best one on their requirements.

1.Scheduling and network planning activities

a.

b.
c. d. e. f.

Microsoft project Project planner Project Scheduler Harvard Total project manager PRISM Yojana

2.Resource management activities

Microsoft project Harvard total project manager Yojana Prism

3. Budgeting activities
Microsoft project PRISM 4.Cost control and performance analysis Project planner Harvard Total project manager Yojana Prism

Project Management Information System(PMIS)

The control and distribution of information to the project team members, and Stake holders are the main responsibility of project manager. They are vital,if the stake holders expectations are to be managed effectively. The cycle of events that leads to the generation of reports are:

measure

Record

Analyse

Act

PMIS contd..

The computer based PMIS are the most commonly used system, and allow the regular updating schedules that provide the basis for management actions. The bar chart produced by the PMIS act as a convenient tool for continuous monitoring and updating of plans.

PMIS contd..

The PMIS is a system having a set of tools and techniques to deliver the information.The project manager use such tools to collect ,combine and distribute informationthrough electronically .The PMIS is used by upper and lower management to communicate with each other.

REVIEW
Performance evaluation: It is done periodically.It seeks to measure the performance of the project on an ongoing basis. Performance evaluation may be done in terms of economic rate of return or book rate of return on investment.

Economic rateof return Cash flow Changesin PV for a given year PV at thebeginningof the year

Book return oninvestment for a given year

Cash flow Changesin Book value Book value at thebeginningof the year

Abandonment analysis

Ordinarily a project is analysed on the assumption that the firm will operate it for a given period .Often it may be possible to abandon the project before this period. The possibility of abandonment,when cosidered explicitly in project analysis may change the decision itself.

Behavoural issues in PM
The project must be abandoned wher it is not progressing ,the way it is expected to perform.The project managers have the tendency to spend more in to losing project in anticipation of recovery without following the logic of investment. This resistance can be overcome by following some simple rule, 1. Evaluate the project on the principles of economic accounting.

2. The project review must be done often to check the life of the project. 3.Develop the proper rewards and penalities for project manager.So the project manager will not continue with losing project. 4.Coduct more independent reviews to set more realistic view of the project.

MODULE-V

Sampling design
Universe/Population:All items in the field of enquiry . Census:Complete enumeration of that universe .In census all the items are covered and no element of chance is left. Hence highest accuracy is obtained.But practically the no of errors occurs wil increase when the no of obervation increases.It consumes great deal of time,energy and money.

If the field of enquiry is large census method is difficult to adopt. Even the gvt. adopt this method very rarely.Such as a population census conducted once in a decade. Sometimes it is possible to obtain the accurate results by studying the part of unverse.The selected respondents from the universe is called sample .

The selection process is called sampling technique.Then the survey conducted is called sample survey. Size of the universe-N Sample size-n n<N n is selected according to some rule for studying some characteristics of the universe.

Sample design It is the process that adopted by the researcher.The size of the sample is called sample size.The sample design is determined before the data is collected.And it should be reliable and appropriate for his study.

Steps in sampling design

Type of universe:-The first step for developing the sample design is to clearly define the universe to be studied.It may be finite/infinite. If it is finite the no of elements in the universe are certain.eg: The workers in the factory,population of a city. If it is infinite the no of elements is uncertain.eg:Stars in the sky,Listners of a specific radio programme.

2. Sampling unit:The decision has to be taken about the sampling unit before selecting the sample. A sampling unit may be geographical one, may be state,district/village or acostrucion unit such as house,flat etc or it may be a social unit such as family,club,school etc./it may be an individual . The researcher must select one or more such units for his studies.

3.Source List:-It is also known as Sampling frame It contains all items of universe(in the case of finite only) , If the source list is not available ,the researcher has to prepare it. It should be correct, appropriate, comprehensive and also reliable.

4. Sample size:- The no of items in the sample is called sample size.It should neither be too large nor be too small, but it should be optimum, and it should be fulfill the requirements of the efficiency, flexibility, reliability and also representativeness.

5.Parmeters of interest:- In determining the sample design,suppose we may be intrested in estimating the proportion of person with some other characteristics of that population or we may be interested in some other measures.All those interests has a strong impact upon the sample design that we should adopt.

`
6.Budgetary constraint:-Cost considerations from practical point of view have a major impact on the decisions relating the size and type of sample 7.Sampling procedure:-the researcher must decide about the -The type of the sample he will use. -techniques to be used for selecting the items.

He must select one sampling design from a lot by considering the factors such as sample size,cost which may reduce the chances of errors.

Census >complete accuracy >Close to true value >Undoubtful results

Sampling >Chances of errors if the sample is less >Inconsistency

Errors in sampling
If the errors are more, the quality of research will be less. So reduce the no of errors as possible. Two types of errors are possible. 1)Systematic bias 2)Sampling errors Results from the errors in the sampling procedures. It can not be reduced / eliminated by increasing the sample size. One solution is that detect and correct errors.

Errors are occurred due to the following reasons 1)Inappropriate sampling frame If the sampling is inappropriate ie. it is biased representation of universe that will result in systematic bias. 2)In survey work,systematic errors occur when the questionnaire/interviews is biased . similarly the physical measuring device is defective then the results are biased.

3)Non respondents :If we are unable to sample all the individuals initially included in the sample. 4)Indeterminancy principle: Sometimes we find that,the individuals act differently when kept under observation that what they do when kept in non observed situations. eg. Work study for avg.speed >under observation speed is reduced

4) Natural bias in the reporting of data Eg.People in general understate their incomes if asked for taxation purpose. Sometime they overstate the income if we ask for social status. Actually they give the answers- what they think is correct rather than their true feelings.

Sampling Errors
Sampling errors are due to the random variations in the sample estimate. The expected value of these errors happens to be equal to zero. It is decreased when there is an increase in sample size. It happens to be in a smaller magnitude. In the case of homogeneous population. Increasing size of the sample size has its own limitations. Large sized sample increases the cost of collecting data and also increase the chance of systematic errors.

So the effective way to reduce such errors is to select a better sampling design,which has lesser sampling error for a given sample size at a given cost. Characteristics of a good sample:

It results in truly representative of population. It results in smaller sampling errors. Syst.errors can be controlled in a better way.

Should be within the cost limit. Produces the results with reasonable level of confidence. Different types of sample design/sampling methods Based on two factors. 1)Representation basis 2)Element selection technique used.

Representation basis

Probability sampling(based on random selection)

Non Probability sampling(based on non random selection)

Element selection basis

Restricted(All others)

Un retstricted (Sample element drawn individualy from a large population.)

Non probability sampling/deliberate sampling/purposive sampling / Judgement sampling

It is the sampling procedure which does not afford any basis for estimating the probability that each item in the population is being included in the sample. In this type items for sample are deliberately selected by the researcher.

The organisers of the enquiry purposively choose the particular units of universe for constituting the sample on the basis that the small mass that they so select out of huge one will be representative of all. Eg.If economic conditions of people living in a state are to be studied, a few towns and villages may be purposively selected for intensive study on the principle that they can be representative of all.

The judgement of the organisors plays an important role in the sampling design. In such design there is a chance of personal elements entering in the selection of sample.(Select sample favourable to his point of view).In such cases there is chances of errors entering in to research.

If the investigators are impartial,working without any bias and well experienced then the results will be reliable. It is used in small enquiries and researched by individuals.This may be adopted because of the relative advantage of time.This type is relatively inexpensive and coveneient.

II Probability sampling/Random sampling/Chance sampling

Under this sampling design every item of the universe has an equal chance of getting in to the sample.A lottery method in which the individual units are picked up from the whole group,by using some mechanical process.This technique is considered as the best technique of selecting a representative sample.

Random sampling from a finite population refers to that method of sample selection which gives each possible sample combination an equal probability of getting included into the sample.This applies to sampling without replacement ie.Once an item is selected for the sample,it cannot be appeared in the sample again.

III Complex random sampling design/Mixed sampling design

Some of the popular complex random sampling designs as follows 1)Systematic Sampling:- The most practical way of sampling is to select every ith item on a list.this is called systematic sampling. In which the first unit selected randomly and the remaining are selected at fixed intervals.It is easier and less costlier method of sampling and it can be conveniently used even in case of large

Stratified sampling:-Under sratified sampling the population is divided into several sub population that are individually more homogeneous than the total population(different subpopulations are called strata) then select the units from each strata since each stratum is more homogeneous than the total population. So we get the better estimates.

Cluster Sampling

If the total area of interest is happens to be a big one ,a convenient way in which a sample can be taken is to divide the area into a no: of smaller non overlapping areas and then randomly select a no. of these smaller areas(usually that are called clusters) then these clusters are randomly selected .It can reduce the cost by concentrating surveys in to selected clusters.But it is not accurate as compared to random sampling.It can be used only because of the economic advantage of it .

Errors in sampling

Sampling errors decreases with increase in sample size,and it happens to be smaller magnitude in case of homogeneous population. But increasing the size sample has its own limitations.i.e.large sized sample increases the cost of collecting data and also enhance the systematic bias. So the effective way to reduce sampling errors is to select a better sampling design which has a smaller sampling error for the given sample size at a given cost.

Sampling errors

Sample surveys imply the study of a small portion of the population and such there could naturally be a certain amount of inaccuracy in the information collected. This inaccuracy may be termed as sampling error or error variance.

Population

Sample Re Respo re Re pon nse

Response error
Chance error

Sampling frame

Frame error

Sampling error=Frame error+Chance error + Response error

Estimating population mean

=

=Standard error of mean of a given sample size =Standard deviation of the population n= Size of the sample

or

2 ( xi x ) =
n 1

or

Type equation here.

x

MODULE-IV

Bench marking

It is a method by which an organisations can measure themselves against the best industry practices. The essence of benchmarking is the process of borrowing ideas adopting them to gain competitive advantage. It is a tool for continuous improvement. It can be used by both service & manufacturing organisations. Through this organisations can understand how the best practices differ from their own activities and give opportunity to implement the changes to close the gap.

Definition Benchmarking is systematic search for the best practices, innovative ideas and highly effective operating procedures.

Bench marking cocept

What is our performance level? How we do this What are the others Performance levels? How did they get this.

Creative adaptatio n

Breakthrough performance

Reasons for bench marking

Bench marking is a tool to achieve business and competitive objectives. Bench marking is a tool to help org. to develop strengths and reduce weaknesses Bench marking allows goals to be set objectively based on external information. Bench marking is time and cost effective

Bench marking process

Bench marking process includes six steps. There can be small changes from organisations to organisations. 1.Decide what to bench mark 2.Under standing the current performance 3.Planning. 4. Studying others 5.Learning from the data 6. Using the findings

1.Decide what to bench mark This decision is based on expected position in the market.To reach that position what are the qualities required for the firm and set those qualities as critical activities and those qualities are critical success factors. Any organisation these critical success factors can be using pareto anlysis and cause and effect diagram.

2.Understanding the current performance:Present practices must be documented well.Tools like flow diagram can be used for documentation process.Quantification can be done from those diagrams.These quantities are called matrices which will be compared with other organisations

3.Planning To start with BM a team must be selected.They will collect the datas reqd. for BM.There are three types of BM. 1)Internal II)Competive III)Process Tools used Gantt chart,PERT chart.

4.Studying Others Study other organisations for selecting one for BM The common method:Questionaires,site visit,and focus group.

5.Learning from the data It is answering a set of questions from the data collected during the study 6.Using the findings:Changes needed will be implemented for bridging the gap between both the organisations. The finding must be translated to goals and objectives and action plan must be developed to implement the process.

Total productive maintenance

Objective to make the equipment available for production.TPM is planning to develop a system that do not require maintenance during the normal production time. This approach is maximizing the use of predictive and preventive maintenance.

Predictive maintenance
The process of using data to determine when a piece of equipment will fail.

preventive maintenance is the

process of periodically performing activities such as lubrication on the equipment to keep the functioning .

Total :- all encompassing by maintenance and production individuals working together. Productive:-Production of goods and services that meet costumers expectation Maintenance:-Keeping the equipment and plant in as good or better than the original conditions at all times.

Objectives of TPM
Maintaining and improving equipment capacity Maintaining equipment for long service Coordinating support from all employees Using a team for continious improvement.

Procedure of TPM implementation

The assessment of the existing maintenance system is the first step in TPM. On its basis further improvement can be implemented in the sequence as given below. 1. Learning the new philosophy:-The new philosophy must first conceived by the senior management.

Procedure of TPM implementation contd.

2. Promoting the new philosophy:The senior management must sell the idea and let the employees know that they are totally committed to its success. A long term commitment is essential for the success of the new system. One of the best way is just start it in the organisation & to give more freedom to mainteanance production

Procedure of TPM implementation contd.

3.Training:-It must start from the top all the employees in the organisation must undergo training. The top management need more training. Middle management &supervisors must train the operators. 4. Identify the improvement needed areas:- Identify the machine that require more repair with the help of operators and solve the problems of m/c and that will give a start for TPM.Then the major loss areas must be measured and tracked. They are:-

Procedure of TPM implementation contd.

1.

Down time losses.

a. b. o o Planned Start up Shift change Coffee and tea breaks Planned maintenance shutdown. Unplanned Equipment breakdown Lack of material.

Procedure of TPM implementation contd.

2. Reduced speed losses a. idling and minor stoppages. b. Slow downs 3. Poor quality losses - process non conformities - scrap These losses can be converted into 3 matrices and that can be converted into equipment effectiveness matrices.

5. Formulation of performance goals. Set the time frame for completing the changes for the first identified problems through discussions.