Supply Ch.2

• Know what project management is and why it is important
  
  • Project
    
    • A series of related jobs usually directed toward some major output and requiring a significant period of time to perform
      
    • Project types:
      
      • Derivative (incremental changes such as new product packaging or no-frills versions)
        
      • Breakthrough (major changes that create entirely new markets)
        
      • Platform (Fundamental improvements to existing products)
        
    • 4 major areas:
      

1. Product change
   
2. Process change
   
3. Research and development
   
4. Alliance and partnership
   

• Project management
  
  • Can be defined as planning, direction, and controlling resources (people, equipment, material) to meeting the technical, cost, and time constraints of the project
    

   
   

• Know the different ways projects can be structured
  
  • Pure project (skunkworks)
    
    • Where a self-contained team works full time on the project
      
  • Functional project
    
    • Housing the project within a function division
      
  • Matrix project
    
    • Attempts to blend properties of functional and pure project structures
      
• Know how projects are organized into major subprojects
  
• Know what a project milestone is
  
  • Project milestone
    
    • A specific event in a project
      
    • Typical milestones might be the completion of the design, the production of a prototype, the completed testing of the prototype, and the approval of a pilot run
      

       
       

• Know how to determine the "critical path" for a project
  
  • Critical Path:
    
    • The sequence of activities in a project that forms the longest chain in terms of their time to complete. This path contains zero slack time. Techniques used to find the critical path are called CPM or critical path method techniques
      
• Know how to "crash", or reduce the length, of a project
  
  • Crash time:
    
    • The shortest possible activity time
      
  • Crash cost
    
    • The coast associated with each crash time
      
  • Slack time
    
    • For some activities in a project there may be some leeway in when an activity can start and finish
       
      
• Critical Path Method (CPM)
  

1. Identify each activity to be done in the project and estimate how long it will take to complete each activity
   
2. Determine the required sequence of activities and construct a network reflecting the precedence relationships
   
3. Determine the critical path
   
4. Determine the early start/finish and late start/finish schedule