MGT-302(Final)

1. Draw the diagram on Integrated Management of Projects. Draw according to Chapter 1

of the textbook.Page-14,Figure-1.2

Ans:

Organization Culture Environment

Strategic Alignment

Portfolio Management

Project Management

2. Explain the Project Portfolio Matrix and draw the diagram according to Chapter 2 of the
textbook

The horizontal axis reflects potential commercial value. The grid has four quadrants, each with
different project dimensions.

 Bread and butter projects typically involve evolutionary improvements to current

products and services. Examples include software upgrades and manufacturing cost
reduction efforts.
 Pearls represent revolutionary commercial advances using proven technical advances.
 Oysters involve technological breakthroughs with high commercial payoffs. Examples
DNA treatments and new kinds of metal alloys.
 White elephants are projects that at one time showed promise but are no longer viable.
3. Explain the different Matrix forms according to Chapter 3 of the textbook.

Different Matrix Forms: In practice there are really different kinds of matrix systems,
depending on the relative authority of the project and functional managers. Here the three kinds
of matrices:

a. Weak matrix: This form is very similar to a functional. There is a formally designated project
manager responsible for coordinating project activities. Functional managers are responsible for
managing their segment of the project.

b. Balanced matrix: This is the classic matrix in which the project manager is responsible for
defining what needs to be accomplished; the functional managers are concerned with how it will
be accomplished. More specifically, the project manager establishes the overall plan for
completing the project, sets schedules, and monitors progress.

c. Strong matrix: The project manager controls most aspects of the project, including scope
trade-offs and assignment of functional personnel. The project manager controls when and what
specialists do and has final say on major project decisions.

4. Explain how WBS helps the Project Manager, according to Chapter 4 of the textbook.

The WBS defines all the elements of the project in a hierarchical framework and establishes their
relationships to the project end item(s). Think of the project as a large work package that is
successively broken down into smaller work packages; the total project is the summation of all
the smaller work packages. This structure facilitates evaluation of cost, time, and technical
performance at all levels in the organization over the life of the project.

a. Each item in the WBS needs a time and cost estimate. With this information it is possible to
plan, schedule, and budget your project. The WBS also serves as a framework for tracking cost
and work performance.

b. As the WBS is developed, organizational units and individuals are assigned responsibility for
executing work packages. This integrates the work and the organization. In practice, this process
is sometimes called the organization breakdown structure (OBS)

c. 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
organizational units and work accomplishment.

d. The WBS can also be used to define communication channels and assist in understanding and
coordinating many parts of the project. The structure shows the work and organizational units
responsible and suggests.
5. Explain Direct Project Overhead Costs according to Chapter 5 of the textbook.

Direct Project Overhead Costs:Direct overhead rates more closely pinpoint which resources of
the organization are being used in the project. Direct project overhead costs can be tied to project
deliverables or work packages. Although overhead is not an

Direct costs----------------------$80,000

Direct overhead -------------- $20,000

Total direct costs -------------$100,000

G&A overhead (20%) -------$20,000
Total costs ------------------- $120,000
Profit (20%) -------------------$24,000
Total bid -----------------------$144,000
Immediate out-of-pocket expense, it is real and must be covered in the long run if the firm is to
remain viable. These rates are usually a ratio of the dollar value of the resources used—e.g.,
direct labor, materials, equipment. For example, a direct labor burden rate of 20 percent would
add a direct overhead charge of 20 percent to the direct labor cost estimate. A direct charge rate
of 50 percent for materials would carry an additional 50 percent charge to the material cost
estimate. Selective direct overhead charges provide a more accurate project (job or work pack
age) cost, rather than using a blanket overhead rate for the whole project.

6. Write all eight basic rules to follow in developing project networks according to Chapter 6 of
the textbook.
The following eight rules apply in general when developing a project network:
1. Networks flow typically from left to right.
2. An activity cannot begin until all preceding connected activities have been completed.
3. Arrows on networks indicate precedence and flow. Arrows can cross over each other.
4. Each activity should have a unique identification number.
5. An activity identification number must be larger than that of any activities that precede it.
6. Looping is not allowed (in other words, recycling through a set of activities cannot take
Place).
7. Conditional statements are not allowed (that is, this type of statement should not appear: If
successful, do something; if not, do nothing).
8. Experience suggests that when there are multiple starts, a common start node can be used to
indicate a clear project beginning on the network
7. Explain activity numbering according to Chapter 6 of the textbook.

Activity Numbering:Each activity needs a unique identification code—usually number. In

practice very elegant schemes exist. Most schemes number activities in ascending order, that is,
each succeeding activity has a larger number so that the flow of the project activities is toward
project completion. It is customary to leave gaps between numbers (1, 5, 10, 15 . . .). Gaps are
desirable so you can add missing or new activities later. Because it is nearly impossible to draw a
project network perfectly, numbering networks is frequently not done until after the network is
complete.

 In practice you will find computer programs that accept numeric, alphabetic, or a
combination of activity designations. Combination designations are often used to identify
cost, work skill, departments, and locations.

8. Give a textbook example of a Risk Assessment Form, according to figure 7.6 in Chapter 7 of
the textbook.

Ans:

Risk Event Likelihood Impact Detection When

Difficulty

Interface problems 4 4 4 Conversion

System freezing 2 5 5 Start-up

User backlash 4 3 3 Postinstallation

Hardware 1 5 5 Installation
malfunctioning
9. Give a textbook example of a Risk Severity Matrix, according to figure 7.7 in Chapter 7 of the
textbook.

The matrix is divided into red, yellow, and green zones representing major, moderate, and minor
risks, respectively. The red zone is centered on the top right corner of thematrix (high
impact/high likelihood), while the green zone is centered on the bottom left corner (low
impact/low likelihood).

10. According to page 257, explain how ease of demonstrating the allocation methods available requires
some limiting assumptions to keep attention on the heart of the problem.

Assumptions: Ease of demonstrating the allocation methods available requires some limiting
assumptions to keep attention on the heart of the problem.

 First, splitting activities will not be allowed. This means once an activity is placed in the
schedule, assume it will be worked on continuously until it is finished; hence, an activity
cannot be started, stopped for a period of time, and then finished.
 Second, the level of resources used for an activity cannot be changed. These limiting
assumptions do not exist in practice, but simplify learning. It is easy for new project
managers to deal with the reality of splitting activities and changing the level of resources
when they meet them on the job.
11. What are the benefits of scheduling resources according to page 272 of the textbook?

Ans: Resource schedules provide the information needed to prepare time-phased work package
budgets with dates. Once established, they provide a quick means for a project manager to gauge
the impact of unforeseen events such as turnover, equipment breakdowns, or transfer of project
personnel. Resource schedules also allow project managers to assess how much flexibility they
have over certain resources. This is useful when they receive requests from other managers to
borrow or share resources.

12. According to page 274 of the textbook, what are the three of the more common problems
encountered in managing multiproject resource schedules?

Ans: The following lists three of the more common problems encountered in managing
multiproject resource schedules:

1. Overall schedule slippage. Because projects often share resources, delays in one project can
have a ripple effect and delay other projects. For example, work on one software development
project can grind to a halt because the coders scheduled for the next critical task are late in
completing their work on another development project.

2. Inefficient resource utilization. Because projects have different schedules and requirements,
there are peaks and valleys in overall resource demands. For example, a firm may have a staff of
10 electricians to meet peak demands when, under normal conditions, only 5 electricians are
required.

3. Resource bottlenecks. Delays and schedules are extended as a result of shortages of critical
resources that are required by multiple projects. For example, at one Lattice Semiconductor
facility, project schedules were delayed because of competition over access to test equipment
necessary to debug programs.

13. According to page 305 of the textbook, explain that one of the more important reasons today
is time to market.

Ans: There are many good reasons for attempting to reduce the duration of a project. One of the
more important reasons today is time to market. Intense global competition and rapid
technological advances have made speed a competitive advantage. To succeed, companies have
to spot new opportunities, launch project teams, and bring new products or services to the
marketplace in a flash. Perhaps in no industry does speed matter as much as in the electronics
industry.
14. According to page 308 of the textbook, explain that the most common method for shortening
project time is to assign additional staff and equipment to activities.

The most common method for shortening project time is to assign additional staff and equipment
to activities. There are limits, however, as to how much speed can be gained by adding staff.
Doubling the size of the workforce will not necessarily reduce completion time by half. The
relationship would be correct only when tasks can be partitioned so minimal communication is
needed between workers, as in harvesting a crop by hand or repaving a highway. Most projects
are not set up that way; additional workers increase the communication requirements to
coordinate their efforts.

15. According to page 314 of the textbook, what are project direct costs?

Direct costs commonly represent labor, materials, equipment, and sometimes subcontractors.
Direct costs are assigned directly to a work package and activity, hence the term. The ideal
assumption is that direct costs for an activity time represent normal costs, which typically mean
low-cost, efficient methods for a normal time.

16. According to page 345 of the textbook, explain what are task-related currencies.

Task-Related Currencies This form of influence comes directly from the project manager’s
ability to contribute to others’ accomplishing their work. Probably the most significant form of
this currency is the ability to respond to subordinates’ requests for additional manpower, money,
or time to complete a segment of a project. This kind of currency is also evident in sharing
resources with another project manager who is in need.

17. According to page 351 of the textbook, explain why many of the tensions that arise between
upper management and project managers are a result of differences in perspective.

Many of the tensions that arise between upper management and project managers are a result of
differences in perspective. Project managers become naturally absorbed with what is best for
their project. To them the most important thing in the world is their project. Top management
should have a different set of priorities. They are concerned with what is best for the entire
organization. It is only natural for these two interests to conflict at times

18. According to page 359 of the textbook, what are the qualities of an effective project
manager?

Project management is, at first glance, a misleading discipline in that there is an inherent logic in
the progression from formulating a project scope statement, creating a WBS, developing a
network, adding resources, finalizing a plan, and reaching milestones.
Some of those contradictions are listed here:

 Innovate and maintain stability. Project managers have to put out fires, restore order, and
get the project back on track. At the same time they need to be innovative and develop
new, better ways of doing things.
 See the big picture while getting your hands dirty. Project managers have to see the big
picture and how their project fits within the larger strategy of their firm.
 Encourage individuals but stress the team. Project managers have to motivate, cajole, and
entice individual performers while at the same time maintaining teamwork.
 Hands-off/Hands-on. Project managers have to intervene, resolve stalemates, solve
technical problems, and insist on different approaches.
 Flexible but firm. Project managers have to be adaptable and responsive to events and
outcomes that occur on the project.
 Team versus organizational loyalties. Project managers need to forge a unified project
team whose members stimulate one another to extraordinary performance.