Chapter 16 Project management

Slide 16.1

Chapter 16 Project management

Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.2

Project management Direct

Design

Project management

Operations management

Develop

Deliver

The market requires… specified time, quality and cost of a project

The operation supplies.. the delivery of the project ontime, on-specification and to budget

Figure 16.1 This chapter covers project planning and control Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.3

Stages in project management Stage Understanding the 1 project environment Stage 2

Stage 3

Changes Project definition

Project planning

Corrective action

Stage 4

Technical execution

Stage 5 Project control

Figure 16.3 The project management model Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.4

The three project objectives of quality, cost and time Quality New aircraft project

Music festival Fixed-grant research project Cost

Time

Figure 16.5 The project objectives triangle


Slide 16.5

Stages in the project planning process

Adjust as necessary Identify the activities in the project

Estimate the times and resources for activities

Identify the relationships and dependencies between the activities

Identify time and resource schedule constraints

Fix the schedule for time and resources

Figure 16.6 Stages in the planning process


Slide 16.6

Work breakdown structure Serve breakfast in bed

Produce glass of orange drink

Obtain juice

Produce boiled egg in egg cup

Obtain glass

Produce boiled egg

Obtain egg cup

Produce buttered toast

Produce toast

Obtain butter

Arrange tray

Obtain plates and cutlery

Obtain tray

Obtain bread Obtain egg

Obtain water

Figure 16.7 A work breakdown structure for a simple domestic project Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.7

‘Making breakfast’– do activities at earliest time Time (mins)

0

1

2

3

4

5

6

7

8

9

Orange Bread

Toast

Activities requiring operator time

Butter

Boil water

Water

Bed room

Boil egg

Staff required

Tray 4 3 2

1 0

0

1

2

3

4

5

6

7

8

9

Time (mins) Figure 16.9 Initial project plan for a simple project, with resources Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.8

Network planning Activities and network for a simple project Activity a b c d e f

Remove furniture

Remove furniture Prepare bedroom Paint bedroom Prepare kitchen Paint kitchen Replace furniture

Immediate predecessors None a b a d c, e

Activity duration (in days) 1 2 3 1 2 1

Replace furniture

Figure 16.14 The activities, relationships, durations and arrow diagram for the project ‘decorate apartment’ Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.9

Network planning (Continued) Activity on arrow – using ‘dummy’ activities to clarify relationships 2 x

x 2

1

1

y

3

y

Figure 16.16 When dummy activities are necessary Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.10

Network planning (Continued) Activity on arrow – using ‘dummy’ activities to describe a relationship that could not be expressed any other way 1

3

5

2

4

6

Figure 16.16 When dummy activities are necessary (Continued) Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.11

Network planning (Continued) The network diagram for a motorway project 18 20 A

D

5

0 0

B 10

7

8

H

E 10

10 10

L 8

27 27

35 35

I

F 9 C 1

G 3

4 19 19

3 J

K

5

M 4

22 22 Figure 16.18 Network diagram for the motorway project Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.12

Activity diagram for the Laz-skan development

Figure 16.27 Some of the elements integrated in enterprise project management systems Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.13

Chapter 17 Quality management


Slide 16.14

High quality puts costs down and revenue up Revenue effects

Cost effects

Improved quality (consistent conformance to customers’ expectations) Enhanced service/product image (brand value)

Reduced cost of detecting errors Faster customer response time

Reduced cost of rectifying errors

Increased customer service Increased sales volume Reduced price competition

Economies of scale

Reduced cost of compensating customers

Reduced capital costs Increased productivity Reduced operations costs

Increased revenue Increased profit

Figure 17.2 Higher quality has a beneficial effect on both revenues and costs Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.15

Perceived quality is governed by the gap between customers’ expectations and their perceptions of the product or service Gap

Gap

Customers’ expectations for the Customers’ product or perceptions service of the product or service

Expectations > perceptions Perceived quality is poor

Customers’ Customers’ expectations perceptions of the for the product or product or service service

Expectations = perceptions Perceived quality is acceptable

Customers’ expectations for the product or service

Customers’ perceptions of the product or service

Expectations < perceptions Perceived quality is good

Figure 17.3 Perceived quality is governed by the magnitude and direction of the gap between customers’

expectations and their perceptions of the service or product Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.16

A ‘Gap’ model of quality Word-of-mouth communications

Previous Experience

Image of product or service

Customer’s expectations concerning a product or service

The customer’s domain

Gap?

Customer’s perceptions concerning the product or service Gap 4

Customer’s own specification of quality Gap 1 Management’s concept of the product or service

The actual product or service

Organization’s specification of quality Gap 3

Gap 2

The operation’s domain

Figure 17.4 The customer’s domain and the operations domain in determining the perceived quality,

showing how the gap between customers’ expectations and their perception of a service or product could be explained by one or more gaps elsewhere in the model Source : Adapted from Parasuraman, A. et al. (1985) A Conceptual Model of Service Quality and Implications for Future Research, Journal of Marketing , vol. 49, Fall. Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.17

Quality Quality fitness for purpose

Quality of Design degree to which design achieves purpose

Reliability ability to continue working at accepted quality level

Quality of Conformance faithfulness with which the operation agrees with design

Variables things you can measure

Attributes things you can assess accept/reject


Slide 16.18

Total quality management can be viewed as a natural extension of earlier approaches to quality management Quality is strategic Teamwork Staff empowerment Involves customers and suppliers

Makes quality central and strategic in the organization

Quality systems Quality costing Problem solving Quality planning

Broadens the organizational responsibility for quality Solves the root cause of quality problems Prevents ‘out of specification’ products and services reaching market

Statistics Process analysis Quality standards Error detection Rectification

Inspection

Quality control

Quality assurance

Total quality management

Figure 17.7 TQM as an extension Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.19

EFQM ‘Business excellence’ model

People results

People

Leadership

Policy and strategy

Partnerships and resources

Processes

Customer results

Key performance results

Society results


Slide 16.20

The cost of rectifying errors becomes increasingly expensive the longer the errors remain uncorrected in the development and launch process

Cost to rectify error

10,000

1,000

100 10 1 Concept

Design

Prototype

Pilot Market use production

Stage in the development and launch process Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.21

Increasing the effort spent on preventing errors occurring in the first place brings a more than equivalent reduction in other cost categories Total cost of quality Costs of quality

Appraisal Internal failure

Appraisal

Prevention

Time Figure 17.9 Increasing the effort spent on preventing errors occurring in the first place brings a more than

equivalent reduction in other cost categories Slack, Brandon-Jones and Johnston, Operations Management PowerPoints on the Web, 7th edition © Nigel Slack, Alistair Brandon-Jones and Robert Johnston 2014

Slide 16.22

Process variability AP X

AX P

Off target ACCURACY : P Scatter

PRECISION : P

AX P X

AP


Slide 16.23

Security of demand and revenue Customer willing to invest in relationship

Partnerships notwithstanding power imbalance

Enhanced organizational learning Confidence to give new orders

Can offer knowledge insights to suppliers

Internal process predictability Forms basis of continuous improvement

Customer trust in process stability

Gain control of ‘run the operation’

Higher capacity utilization

Control charts become focus of process discussions Less chance of arbitrary decisions

Reduced decision making ambiguity Increased job satisfaction

Less downtime and waste

Lower cost base

Develop customer relationship skills

Sense of professionalism ‘being in control’ Better understanding of process capabilities Ability to cope with variety without excess cost

Enhanced staff retention

Develop basis for in-house product development

Staff confidence in own abilities


Slide 16.24

RTO and CTO are not mutually exclusive activities (Continued)

learning Innovation Intervention Process knowledge

Capability Process knowledge
