1. FUNDAMENTALS OF PROJECT MANAGEMENT

2. Need of Project Management Projects worth billions of rupees undertaken every year. Effective management has bearing on overall growth of national economy. Indian experience with regard to project management is mixed. Some projects completed before time and most others completed with time and cost overrun. Time, resource, cost management are sine-qua-non of project management.

3. PROJECT MANAGEMENT Project Management can be defined as the process of controlling of a project from beginning to an end to achieve project objectives in a given time and cost as shown below: PROJECT MANAGEMENT PLANNING EXECUTING CONTROLLING END PRODUCT HUMAN & TECHNICAL RESOURCES TIME FUNDS Project Goals

4. Cycle of project management The cycle of project management is shown below. The main elements are Planning, Execution, Monitoring & Control. PLANNING SET OBJECTIVES SURVEY RESOURCES FORM STRATEGY CONTROLLING MEASUREMENTS AGAINST GOALS REPORT RESOLVE PROBLEMS EXECUTING ALLOCATING RESOURCES GUIDE EXECUTION CO-ORDINATE EFFORT MOTIVATE STAFF Cycle of Project Management

5. PLANNING Planning includes forecast of resource requirements of people, materials and equipment, forecast of financial requirements and provision of ‘milestones’ against which progress can be measured. Planning principles Plan should provide information in a readily understood form. be realistic. be flexible. serve as a basis for progress monitoring the control. be comprehensive.

6. Planning techniques Bar Charts also known as Gantt charts. Network analysis by Critical Path Method (CPM) or Programme Evaluation & Review Technique(PERT) -provides a means to predict time required for completion -identifies activities whose execution is crucial(critical activities) -serves as guide for shortening if completion is to be advanced -provide basis for scheduling of subcontractor&material delivery -serve basis for scheduling of manpower,finance & equipment -makes possible rapid evaluation of alternative const. Methods -serves a convenint vehicle for progress reporting/recording -serves as basis for probability analysis

7. How to plan a work? Whole set of activities to be identified( work break down structure) Activities to be arranged in correct order or logical sequence Draw a network diagram and estimate time duration for activities Two approaches for time estimates based on sound resource planning -Deterministic where previous experience is available ( CPM) - Probabilistic where no experience available or uncertainity (PERT) Time estimates are made for each activity on a three-way basis: -Optimistic time -Most Likely time -Passimistic time Three estimates reduced to a single expected time for computation

8. How to plan a work? (Contd.) Analysis of network and estimation of critical path to establish longest sequence of activities and find ‘float’ in other activities Use of network for activity & path bar chart,resource distribution Time-cost trade off and optimum network Probability of meeting a schedule date (plan for 80% probability) Planning financial resources -Early investment(curve A) -Late investment(curve B) CUMULATIVE COST CURVE ‘A’ CURVE ‘B’ DURATION S curve

9. Project monitoring and control Process of monitoring runs concurrently with execution. Monitoring the actual progress (physical & financial) Compare actual progress with planned & gauge effect of deviation Identifying & analysing reasons for time & cost over-run Replan work by revising network with revised resource allocation CONTROL OR/AND REPLAN THE SCHEDULE ANALYSIS & IDENTIFYING THE REASONS COMPARE THE ACTUAL WITH PLANNED PROGRESS MONITOR THE ACTUAL PROGRESS CONTROL CYCLE

10. Frequency of monitoring depends upon amount of control required, type & duration of project.Not too frequent nor late. Reporting system & form of progress report should be simple to enable to compare actual with planned quickly. Three elements to be monitored and controlled Physical progress - For time control (against time) Simplest method is by means of Milestones.  Financial progress- For cost control (against budget) Cost overrun may be due to inflationary effect,change in design or scope of work or process or technology or better knowledge of site  Quality Control (against specification) Project Monitoring & control (contd..)

11. Variance Analysis Any departure from the ‘estimated project cost’ is known as variance (not the statistical variance). Called unfavourable if planned amount exceeded favourable if less cost incurred than planned Variance analysis is to be done for each activity in the network, where cost overrun occurs and they are to be done separately for the (i)Use of resources (such as material & labour) (ii)Prices of the above resources. This enables to pinpoint actual cause of cost overrun for taking corrective action or any further misuse of any resources

12. CONCLUSION Isolated use of these techniques will not help in success of a project unless we take care of other factors and areas of project management which are equally important for the success of the project viz.: (i) Project management information system (ii) Project organisation (iii) Communication and motivation in organisation (iv) Project environment (v) Procurement and negotiations Nevertheless, use of techniques help manager to identify critical areas and take managerial action well in time