lecture2 full corrected

BMIS2551: Project Management Spring 2015; Narayan Ramasubbu

Class 2: 1/14/2015

Case: Bank of America TrustWeb Project

Topics: WBS, Scheduling

What the class wants

• About 50% split between exam and project

• Topics

– PM framework, PMP, MS Project, problem-solving,

decision-making, dealing with people

• Anxieties

– Group work, time management, course load, wikis,

class discussion

• Suggestions for me

– Interactive, engaging, flexible, timely feedback, let go

early!, be thorough, speak slowly, jokes…

BMIS2551; Spring 2015; Narayan Ramasubbu 2

Project folks, please start discussing topic with me

We should cover all

of this

Group of 1 is fine; I am here to help!

Help me do all of this (and laugh too!)

Admin stuff

• Group formation and Wiki

– Let us settle groups now

– Try out the wiki

• MS Project

– Katz IT will provide licenses for all interested students

enrolled in course

– We need to wait for the course drop deadline

– Meanwhile, download evaluation copy from MS and

get started…

• Any other matters?


Optional guest speaker Info

• Mr. Fred Koos

– Program manager at UPMC

– VP / President elect of PMI

• Talk in the evening section (6:20-7:30pm)

– Please feel free to attend

• Will share slides from talk


PM OVERVIEW: FORMALLY

STRUCTURED VS. ADAPTIVELY

AGILE

Class1-Section7


PM approaches spectrum

• Formal structured approach emphasizes

– discipline, plans, control, and track and trace

– Contracts and documentation aplenty

• Adaptive agile approach values

– individuals and interactions over processes and tools

– working artifacts over comprehensive documentation

– customer collaboration over contract negotiation

– responding to change over following a plan

– see: http://agilemanifesto.org/


http://agilemanifesto.org/



Examine structure vs. agile PM approaches

• What are the pros and cons of the approaches?

– Think about delusion and deception in each of these

approaches

• Is one more preferable than the other?

– When? For what type of projects?

• Which type of approach would you prefer?

– As a project sponsor?

– As a project manager?

– As a project member?

• Don’t forget to document your answers!


Group

Activity #2

Structured-agile: striking a balance

• Tension between structured and agile

approaches

– becomes efficiency OR flexibility choice

– extremes are often sub-optimal

• Seeking balance for ambidexterity

– Structural approaches

• Different projects/units, different approaches

– Contextual approaches

• Individuals are empowered to be entrepreneurs, brokers, and

multi-taskers and make the call.

• Read more: Birkinshaw, J., and Gibson, C., “Building ambidexterity into an

organization,” MIT Sloan Management Review, Summer 2004, pp. 47-55.


Structured-agile gives rise to process diversity

• Process diversity

– Simultaneous presence of multiple process designs

(often differing in their philosophies)

• For discussion: Is diversity good or bad?

• From my research

– Fit or alignment between process diversity and

process compliance crucially affects performance

outcomes

– Process deviations by project “insiders” need to be

carefully monitored, tracked, and assessed with the

help of “outsiders”.


BANK OF AMERICA TRUSTWEB

PROJECT

Class2-Section1


Case Discussion

• Setting up

– What is the overall context in which the project is situated in?

– How would you characterize the integration process at BOA?

• What are the key issues of the TrustWeb project?

– Why does Mike Morris think the presentation was a failure in

content and presentation?

• What are the deeper issues?

– Where there any “delusion” and “deception” issues?

– How would you compare this project with the characteristics of

“great” projects we saw in class 1?

• How to get the project back on track?

• What are the big “takeaways” from the case?


PROJECT DIVISION OF LABOR (WBS),

SCHEDULING

Class2-Section2


Work Breakdown Structure

• Break project down to tasks

– To the lowest unit of time that matters

– Multiple levels of aggregation

• Typically 3-6 levels that matches the team

hierarchy

– Involve everyone in designing and verifying

the WBS

• Mitigate delusion and deception

• Get commitment


Time and Resource Estimates

• For every task in the WBS

– Who is doing the task?

– How much time will it take to complete?

– How much will it cost?

• From estimates to reality

– Which estimation model?

• Learning effects

• Uncertainty

– Extent of built-in “buffer”


Scheduling at work


A

B

C

D

E

F

G

H

• Modeling task relationships: A, B, C, D, E, F, G, H

Duration of tasks given as:

A:5, B:5, C:6, D:13, E:6, F:4, G:9, H:2 (hours, days, weeks, etc.)

Task relationship in a Gantt chart


SLACK ability to delay a task without affecting the whole project

Critical path: task completion path with no slack

Task relationship: task network


A, 5

B, 5

C, 6

D, 13

E, 6

F, 4

G, 9

H, 2

Path 1: A-B-E-H: 18

Path 2: A-B-D-F-H: 29

Path 3: A-C-D-F-H: 30

Path 4: A-C-G-H: 22

• Modeling task relationships

Slack: ability to delay a task without affecting

the whole project

Critical path: task completion path with no

slack

Scheduling at work: handling uncertainty

• Likelihood or probabilities get into the

picture

– Scenario planning is “playing” with

probabilities

– Optimistic, most likely, pessimistic values for

estimates

• Modeling: how are these estimates

distributed?


Modeling uncertainty

• An empirical trend: estimates are often

asymmetrically distributed


optimistic

likely

pessimistic

Modeling uncertainty: assumptions and

formulas for beta distribution

• Range of estimations is often within 6 standard

deviations of the expected value

– Expected value is estimated as a “weighted average”:

1/6th of optimistic (a), 4/6th of likely value (m), and

1/6th of pessimistic value (b)

• Formulas:

– Standard deviation = (b – a)/6

– Expected completion time = (a + 4m + b)/6


Deriving expected values


Task Optimistic

(a) Most likely

(m) Pessimistic

(b) Expected Variance

A 3 4 11 5 1.777778

B 2 5 8 5 1

C 3 6 9 6 1

D 8 12 20 12.66667 4

E 3 5 12 5.833333 2.25

F 2 4 7 4.166667 0.694444

G 6 9 14 9.333333 1.777778

H 1 2 4 2.166667 0.25

A, 5

B, 5

C, 6

D, 13

E, 6

F, 4

G, 9

H, 2

Expected time =

(a + 4m + b) / 6

Variance =

[ (b-a) / 6 ] 2

Handling project uncertainty: variance

• Variance of a project provides the degree of

uncertainty

– Additive variance of tasks in critical path

𝑃𝑟𝑜𝑗𝑒𝑐𝑡 𝑉𝑎𝑟𝑖𝑎𝑛𝑐𝑒 = 𝑣𝑎𝑟𝑖𝑎𝑛𝑐𝑒 𝑜𝑓 𝑡𝑎𝑠𝑘𝑠 𝑖𝑛 𝑐𝑟𝑖𝑡𝑖𝑐𝑎𝑙 𝑝𝑎𝑡ℎ


Task Optimistic

(a) Most likely

(m) Pessimistic

(b) Expected Variance

A 3 4 11 5 1.777778

B 2 5 8 5 1

C 3 6 9 6 1

D 8 12 20 12.66667 4

E 3 5 12 5.833333 2.25

F 2 4 7 4.166667 0.694444

G 6 9 14 9.333333 1.777778

H 1 2 4 2.166667 0.25

Project variance = 7.72 (1.78 + 1 + 4 + 0.69 + 0.25)

Standard deviation = sqrt (variance) = sqrt (7.72) = 2.78

Handling project uncertainty: decision-making

• How likely is that a project would finish on time?

– Assume probabilities are drawn from a “normal” distribution (aka

bell curve)

– Use “area under the curve” or Z score to estimate likelihood of

completion

• Example

– Let us say it is absolutely necessary to finish the example project in 32

days.

– The critical path is 30 days, with variance 7.72 (and SD=2.78)

– Z score = (32-30) / 2.78 = 0.72

– Lookup table: 76% likelihood that the project will be completed on time.


Excel: NORMDIST (value, mean, SD, TRUE)

=NORMDIST (32, 30, 2.78, TRUE) = 0.76

Including uncertainty buffer in planning

• We need 95% confidence that the project would finish on

time. How much extra time should the team be given?

– Time needed = (expected) + (Z score * Standard deviation)

• Example

– Let us say we need to plan for project with 95% probability

– 95% probability yields a Z score of 1.65 (lookup tables)

– Time needed = (30) + 1.65 * 2.78 = 34.59

– So plan to provide an extra 4.59 days for the project team.


Excel: NORMINV (probability, mean, SD)

=NORMINV (0.95, 30, 2.78) = 34.57

Optimizing a schedule

• Tweaking estimation

– Different model

– Cut buffer

– Cut oversights

• Parallelize

• Remove bottlenecks

• Improve productivity

– Level overcommitments


From schedule to budget

• Top down vs. bottom up

– Activity based costing

• Budget contingencies

– Scenario planning

– Provision to raise money?


Elements of project planning


WBS

Schedule Budget

Project

Plan

Tollgate check

• Can we afford this project?

– Time, skills, and money

• Is it worth it?

– Making it succeed

– Risking failure


Summary

• Thoroughness of planning needs

– Fine-grained WBS

– Scenario planning for task estimations

– Handling uncertainty

– Avoiding delusion and deception

• PM is a facilitator

• Commitment from all stakeholders


Looking forward to class 3

• Topics: tracking, controls, and tradeoffs

• Required reading before class

– Case 2: Teradyne Corporation: The Jaguar

Project

• Groups firmed up

– Wikis up to date (both group and individual)


Practice problem A marketing project manager has developed a project with the following tasks for a

new campaign. In addition, the manager has gathered the time information for

each task, as shown in the table below.

1. Calculate the expected task completion times.

2. What is the total project length?

3. Identify the critical path. What are the alternative paths and how much slack time is

associated with each path?

4. Given the task time variances, what is the likelihood of the project finishing on week 24?

5. Suppose you wanted to have a 99% confidence in the project finishing on time. How

many additional weeks would your project team need to negotiate for in order to gain this

99% likelihood?


Time Estimates (week)

Task Immediate

predecessor task

Optimistic Most likely Pessimistic

A -- 1 4 7

B -- 2 6 10

C B 3 3 9

D A 6 13 14

E A,C 4 6 14

F B 6 8 16

G D, E, F 2 5 8

Group

Activity

#3

lecture2 full corrected

Documents

agile approaches

project management spring

narayan ramasubbu class

agile pm approaches

talk bmis2551 spring

project manager

jokes bmis2551 spring

project insiders