Topic 1

Definition of Project Management

 Project management is the application of knowledge, skills, tools, and techniques to
plan, organize, implement, and control project activities.
 It ensures efficient and effective use of people and resources to meet project
requirements.
 Originated from military and aerospace programs (e.g., Polaris Missile Program,
NASA Apollo).
 Needed due to increasing project complexity, competition, and demand for fast
delivery of products and services.
 Helps address project challenges such as cost overruns, delays, and failure to meet
specifications.
Definition of a Project
 A project is a temporary endeavor undertaken to create a unique product or
service.
 Projects have a definite life cycle, unique characteristics, and involve complex
interdependencies.
 Projects operate within constraints such as limited resources (time, money, people).
Roles of the Project Manager
 Responsible for ensuring the project is completed on time, within budget, and with
the required functionality and quality.
 Must balance trade-offs between performance, cost, and time.
 Manages conflicts arising from competing demands on resources and priorities.
 Maintains clear communication and coordination among various stakeholders.
 Applies effective planning, negotiation, creativity, flexibility, and problem-solving
skills to adapt to changes.
 Acts as the central authority responsible for project success.
Other Related Roles (for context)
 Sponsor: Controls schedule, scope, budget, and quality.
 Customer: The individual or group ordering or benefiting from the project.
 End User: Those who will use the project’s product.
 Team: Individuals performing the work to complete the project.
Key Points in Bullet Format
 Project Management: Planning, organizing, implementing, and controlling project
tasks using specialized knowledge and skills.
 Project: Temporary and unique with a specific goal.
 Project Manager Roles:
 Ensure timely completion and budget adherence.
 Deliver required quality and functionality.
 Manage trade-offs: cost, time, and performance.
 Resolve conflicts and coordinate stakeholders.
 Use creativity, flexibility, and negotiation.
Topic 2

Summary: Topic 2 – Project Management & Project Manager Roles, Types of Organization
1. Definition of Project Management
 Project management is the application of knowledge, skills, tools, and techniques to
meet project requirements.
 Effective project management aims to:
 Meet business objectives.
 Satisfy stakeholder expectations.
 Increase predictability and chances of project success.
 Deliver the right product on time.
 Resolve problems and respond to risks timely.
 Optimize use of organizational resources.
 Identify, recover, or terminate failing projects.
 Manage and balance constraints such as scope, quality, schedule, cost, and
resources.
 Manage change effectively.
2. Roles of Project Manager
 The project manager leads the project team responsible for achieving project
objectives.
 Distinct from functional and operations managers.
 Responsibilities include:
 Coordinating and integrating activities across multiple functional lines.
 Developing, executing, and updating the project plan.
 Communicating effectively with all stakeholders including senior
management, clients, and the project team.
 Essential skills and competencies:
 Technical project management knowledge.
 Leadership to guide and motivate the team.
 Strategic and business management understanding.
 Communication skills (verbal, written, nonverbal).
  Negotiation, conflict resolution, persuasion.
 Credibility, sensitivity, ethical leadership.
 Manages the Triple Constraints (Iron Triangle):
 Scope: Deliverables and tasks.
 Time: Project schedule.
 Cost: Budget constraints.

### 3. **Types of Organizational Structures and Their Application**

Description
Type Advantages Drawbacks Application
& Structure
Project team Efficient for Expensive for
Large,
separated large projects; small projects;
complex
from resources duplication of
Pure Project projects
functional readily specialists;
Organization needing
departments; available; short limited depth in
dedicated
PM has full communication some
teams.
authority. lines. specialties.
Projects
Slow cross-
managed Strong
department
Functional within technological Small projects
communication;
Project functional expertise; or routine
low project
Organization departments; resource operations.
priority; limited
PM authority specialization.
project focus.
is limited.
Flexible; Complex
Hybrid; team Medium to
strong project management;
members large projects
Matrix focus; better conflicts from
report to both requiring
Project resource dual reporting;
functional and cross-
Organization utilization; unity of
project functional
minimizes command
managers. collaboration.
isolation. issues.
Mixed Combination Tailored Complexity in Organizations
Project of pure, flexibility; coordination with diverse
Organization functional, combines and project
and matrix strengths of management. portfolios.
forms tailored other
to structures.
organizational
 needs.

Topic 3
Based on the uploaded lecture notes, here is a focused summary related to the course learning
outcome: Schedule resource, budget, and control cost in managing project.
Key Points Related to Scheduling Resources, Budgeting, and Cost Control
 Project Plan Elements Related to Scheduling and Resources:
 Schedules:
 Outline all project schedules and milestones.
 Include task durations and predecessors.
 Combine milestones, task durations, and predecessors into a Project
Master Schedule to monitor progress.
 Resource Requirements:
 Estimate project expenses including overhead and fixed charges.
 Identify type and quantity of resources required for each activity.
 Personnel:
 Identify special skill requirements and necessary training.
 Address legal arrangements such as non-disclosure agreements if
needed.
 Developing the Project Action Plan:
 Breakdown project activities into hierarchical levels (Work Breakdown
Structure - WBS).
 Assign responsible individuals or groups for each activity.
 Estimate task durations and predecessors for scheduling.
 Identify all project milestones.
 Specify resource needs for each activity.
 Project Master Schedule:
 Integrates milestones, task durations, and predecessor relationships.
 Enables comparison between planned and actual task durations.
 Helps track resource usage and manage project timelines effectively.
 Risk Management Impact on Scheduling and Budget:
 Potential risks such as late subcontractor deliveries, equipment failure, and
unreasonable deadlines can affect schedules and costs.
 Risk management involves listing these potential problems to prepare
contingency plans.
 Cost Estimation and Budget Control:
  Resource requirements section includes estimated project expenses.
 Budget planning encompasses overhead and fixed charges.
 Monitoring procedures involve evaluation methods to track project
performance and control costs.
 Project Launch Meeting & Initial Tasks:
 Preliminary budget review and development of an initial plan during the
launch meeting.
 Understanding expectations and scope to ensure realistic scheduling and
budgeting.
 Tools and Techniques to Support Scheduling and Resource Management:
 Work Breakdown Structure (WBS): Hierarchical task decomposition to
clarify scheduling and resource allocation.
 Gantt Charts and Precedence Diagrams: Focus on task order and timing.
 Design Structure Matrix (DSM): Maps information flows between tasks to
better coordinate resource usage.
 Mind Mapping: Engages team creativity to identify tasks and resources
needed.

Aspect Description
Scheduling Develop detailed schedules with milestones, durations,
and dependencies; create Project Master Schedule for
control.
Resource Estimate resource types and quantities; account for
Planning personnel skills and legal requirements.
Budgeting Estimate expenses including overhead and fixed
charges; review budgets in initial planning.
Cost Control Use evaluation methods to monitor performance and
control costs; manage risks impacting schedule and
budget.
Project Control Use WBS, Gantt charts, DSM, and mind mapping to
Tools plan, allocate, and monitor resources and schedules.

Topic 4
Based on the uploaded content related to budgeting, scheduling, resource allocation, and
cost control in project management, here is a focused summary aligned with the course
learning outcome:

Key Concepts and Processes

 Budgeting Overview
 Budgeting is the process of planning and allocating financial resources to
project activities.
 It involves forecasting needed resources, quantities, timing, and costs.
 Budgets align project activities with organizational goals and help
management monitor and control costs.
 Scheduling and Resource Planning
 Use the Work Breakdown Structure (WBS) to define project tasks and
allocate resources.
 Schedule baseline is established by sequencing WBS activities with start and
end dates.
 Time-phased budgets distribute costs and resources across the project
schedule.
 Budgeting Approaches:
 Top-Down Budgeting: Estimations made by senior management based on
major task costs; quicker but less detailed.
 Bottom-Up Budgeting: Detailed estimation at task level by those responsible
for execution; more accurate but risk of missing tasks.
 Work Breakdown Structure (WBS) and Budgeting Levels:
 WBS decomposes project into:
 Control Accounts (Level 3): Major management control points for
cost and schedule monitoring.
 Work Packages (Level 4): Detailed work elements with time-phased
budgets, milestones, and cost tracking.
 Planning Packages: Future work segments not yet detailed, with
estimated budgets and schedules.
 Cost Elements in Budgeting:
 Direct costs: Labor, materials, subcontractors.
  Indirect costs: Overhead, General & Administrative (G&A), Cost of Money
(COM), etc.
 Profit/Fee is excluded from Contract Budget Base (CBB) but included in Total
Contract Price.

Step-by-Step Budgeting and Cost Control Process

1. Define Project Scope and WBS
 Break down project into manageable work elements (WBS).
 Assign Control Accounts and Work Packages.
2. Estimate Resource Requirements and Costs
 Estimate labor hours, materials, equipment, and overhead for each task.
 Example calculation:
Labor Cost = Labor Hours × Labor Rate Overhead = % of Labor Cost Total Cost = Labor
Cost + Materials + Overhead
 Example from content:
Labor hours = 16, Rate = RM10/hour, Materials = RM235, Overhead = 50%
of labor
Calculation:
Labor cost = 16 × 10 = RM160 Overhead = 0.5 × 160 = RM80 Total = 160 + 235 + 80 =
RM475
3. Develop Proposed Costs and Prices
 Assign resources with rates to each WBS element.
 Calculate total burdened cost including overhead, G&A, COM, and add
profit/fee.
4. Negotiate and Finalize Contract Price
 Adjust proposed costs based on negotiation (e.g., material substitutions).
 Separate negotiated cost (excluding profit) and fee to determine final contract
price.
5. Establish Contract Budget Base (CBB)
 CBB = Negotiated total cost without profit/fee + estimated authorized
unpriced work.
 Profit/Fee is excluded from CBB.
6. Set Management Reserve (MR)
  MR is typically a percentage (e.g., 10%) of CBB to cover unforeseen issues.
 MR is held separately and not included in Performance Measurement Baseline
(PMB).
7. Develop Performance Measurement Baseline (PMB)
 PMB = CBB – MR, represents time-phased, allocated budget for performance
tracking.
 Distributed Budgets assigned to Control Accounts and Work Packages.
8. Distribute Target Budgets
 Assign time-phased budgets to Control Account Managers for execution and
control.
 Adjust budgets collaboratively if initial estimates are unrealistic.
9. Monitor and Control Costs
 Use baseline to compare actual costs and schedule progress.
 Control Accounts track variance and corrective actions.
 Undistributed Budget (UB) managed for authorized but unplanned work.

Element Description
Total Contract Price Total negotiated cost + profit/fee
Total Contract Cost Negotiated cost excluding profit/fee
Profit/Fee Estimated profit, excluded from CBB
Contract Budget Base Total budget for authorized work, excluding
(CBB) profit/fee
Management Reserve Contingency budget for unforeseen events
(MR)
Performance Time-phased budget for measuring project
Measurement Baseline progress (CBB - MR)
(PMB)
Distributed Budgets Budgets allocated to Control Accounts and
Work Packages
Undistributed Budget Authorized budget not yet assigned to control
(UB) accounts
Topic 5
The uploaded lecture content on Project Scheduling (Topic 5) covers important concepts and
techniques that directly contribute to achieving the course learning outcome: "Schedule
resource, budget and control cost in managing project." Below is a focused summary
extracted and synthesized around this outcome.

Key Concepts Related to Scheduling Resources, Budget, and Cost Control

 Project Scheduling Techniques
 PERT (Program Evaluation and Review Technique):
 Uses probabilistic activity durations to estimate project timelines.
 Helps manage uncertainties in activity times.
 CPM (Critical Path Method):
 Uses deterministic activity durations.
 Identifies the critical path to focus on activities that affect project
completion time.
 Terminology and Framework
 Activities: Tasks consuming resources and time.
 Events: Milestones marking completion of activities; consume no
resources/time.
 Network Diagrams: Visual tools (AOA and AON) that represent project
activities and their dependencies.
 Critical Path: Sequence of activities that determines the minimum project
duration; delays here delay the whole project.
 Slack (Float): Extra time available on non-critical activities; important for
resource flexibility and cost control.
 Building and Analyzing Networks
 Two network types:
 AOA (Activities on Arrows)
 AON (Activities on Nodes)
 Use dummy activities to clarify dependencies without adding time or
resources.
 Calculations for Scheduling and Cost Control
1. Estimating Activity Duration (PERT Formula):
  Expected time (TE) for each activity: TE=6a+4m+b where
a = optimistic time,
m = most likely time,
b = pessimistic time.
2. Variance of Activity Time: σ2=(6b−a)2
3. Slack Calculation: Slack=LS−ES=LF−EF where
LS = Latest Start, ES = Earliest Start,
LF = Latest Finish, EF = Earliest Finish.
4. Critical Path Identification:
 Path with zero slack.
 Determines the shortest project duration.
5. Probability of Completing Project on Time:
 Calculate total expected time μ and variance σ2 for the critical path.
 Use Z-score: Z=σD−μ where D is the desired completion time.
 Use normal distribution (e.g., Excel NORMDIST function) to find
probability.
6. Determining Completion Time for a Given
Probability: D=μ+Z×σ where Z corresponds to the desired confidence level
(e.g., 95%).
 Tools and Visual Aids
 Gantt charts to visualize schedules, critical path, and slack.
 Microsoft Project examples showing network diagrams and Gantt charts.
 Extensions for Realistic Scheduling
 Different types of activity dependencies to model real project constraints:
 Finish-to-Start (F to S)
 Start-to-Start (S to S)
 Finish-to-Finish (F to F)
 Start-to-Finish (S to F)
 Resource and Cost Control Implications
 By understanding critical paths and slack, project managers can allocate
resources efficiently.
 Probabilistic time estimates allow for better budgeting by factoring
uncertainty.
  Monitoring slack helps control costs by avoiding unnecessary rush or resource
idling.
 Scheduling techniques help identify potential delays early, enabling corrective
actions to control budget and time.

Summary in Bullet Points

 Use PERT and CPM to schedule activities with probabilistic and deterministic
durations respectively.
 Represent project tasks and dependencies clearly using AOA and AON network
diagrams.
 Calculate expected times (TE) and variances for activities using optimistic, most
likely, and pessimistic times.
 Determine critical path (zero slack) to identify tasks that directly impact project
completion time.
 Calculate slack to find flexibility in scheduling non-critical tasks, aiding resource
leveling and cost optimization.
 Use probability and statistical techniques (Z-scores, normal distribution) to assess
likelihood of project completion by a target date.
 Utilize Gantt charts and software tools (e.g., Microsoft Project) for visual
scheduling and control.
 Apply different dependency types (F-S, S-S, F-F, S-F) to handle complex task
relationships.
 Scheduling and slack analysis support efficient resource allocation, timely project
delivery, and budget control by anticipating risks and uncertainties.

Summary of Steps for Calculations (PERT Example)

1. Identify optimistic (a), most likely (m), and pessimistic (b) times for each activity.
2. Calculate expected time (TE): TE=6a+4m+b
3. Calculate variance: σ2=(6b−a)2
4. Construct the network diagram and determine earliest start/finish (ES,
EF) and latest start/finish (LS, LF) times.
5. Calculate slack for each activity: Slack=LS−ES
6. Identify the critical path (activities with zero slack).
 7. Sum expected times and variances along the critical path.
8. Calculate the probability of project completion by a target date using: Z=σD−μ and
normal distribution.
9. Compute the completion time for a desired confidence level: D=μ+Z×σ

Key Concepts
 Scheduling Resources:
 Identify task durations and sequences.
 Determine dependencies (what can start first and what must wait).
 Budgeting:
 Provide a detailed cost breakdown that closely aligns with actual costs.
 Understand the necessary skills, equipment, materials, and team members
required for each task.
 Cost Control:
 Monitor project costs against the budget to ensure financial objectives are met.
Calculation Steps
If calculations are necessary for budgeting or scheduling, here are some general steps and
formulas that can be applied:
1. Task Duration Calculation:
 Formula: Total Duration = Sum of all Task Durations
 Example: If Task A takes 5 days and Task B takes 3 days, Total Duration = 5 +
3 = 8 days.
2. Budget Calculation:
 Formula: Total Budget = Sum of all Individual Costs
 Example: If Labor costs 2000,Materials1500, and
Equipment 1000,TotalBudget=2000+1500+1000=4500.
3. Cost Control Analysis:
 Formula: Variance = Actual Cost - Budgeted Cost
 Example: If Actual Cost is 5000andBudgetedCostis4500, Variance = 5000 -
4500 = $500 (indicating an overspend).
Here’s a concise extraction and summary of the relevant information related to the course
learning outcome focusing on scheduling resources, budgeting, and controlling costs in
project management:
Key Points
 Project Definition:
 Clearly define the project scope and objectives to establish a foundation for
resource scheduling and budgeting.
 Task Breakdown:
 Divide the project into smaller, manageable tasks to facilitate detailed
scheduling and cost estimation.
 Logical Sequence:
 Establish a logical working sequence of tasks to understand dependencies and
scheduling requirements.
 Duration Estimation:
 Estimate the duration of each task to develop a realistic project timeline.
 Task Timing and Priority:
 Calculate the timing and priority for each task to optimize resource allocation
and ensure timely project delivery.
 Resource Reconciliation:
 Reconcile task needs with available resources to ensure that all tasks can be
completed within the project constraints.
Cost Management
 Cost Baseline:
 Establish a cost baseline as a measure of project performance and success.
 Funding Requirements:
 Identify project funding requirements to ensure adequate financial resources
are allocated.
 Cost Management Plan:
 Develop a comprehensive cost management plan that includes:
 Activity cost estimates.
 Supporting details for cost estimations.
 Spending margins.
Cost Estimation Steps
1. Identify Resource Costs:
 Calculate the costs associated with resources needed (labor, materials,
software, etc.).
2. Estimate Activity Costs:
 Summarize the costs for all activities involved in the project.
3. Calculate Total Costs:
 Formula: Total Project Cost = Sum of Activity Costs + Contingency +
Overheads
4. Adjust for Changes:
 Document any requested changes and their impact on the overall cost and
schedule.
5. Monitor and Control:
 Regularly compare actual spending against the budget to control costs
effectively.
Topic 6
(Schedule Resource, Budget and Control Cost in Managing Project & Differentiate
Types of Organization and Its Application)

1. Scheduling Resources, Budgeting, and Cost Control

 Resource Allocation Overview
 Projects compete for consumed (materials) and non-consumed (equipment)
resources.
 Goal: Optimize use of limited resources, balancing trade-offs between:
 Time-constrained: Completion by a fixed deadline
 Resource-constrained: Limited budget or availability
 Critical Path Method (CPM) and Crashing
 Use normal and crash duration estimates with associated costs.
 Activity Slope (Cost per Day) formula:
Activity Slope=Normal Time−Crash TimeCrash Cost−Normal Cost
 Crashing focuses on shortening critical path activities at the least cost to
reduce total project duration.
 Fast-tracking allows overlapping phases (e.g., start building before design is
complete) to expedite the project.
 Resource Loading and Leveling
 Resource Loading: Quantifies how much of a resource is scheduled per
activity/time period.
 Resource Leveling: Adjusts schedules to resolve over-allocations and avoid
overworking critical resources.
 Tools used: Gantt charts, resource loading charts, and leveling reports.
 Handling Over-allocation
 Overwork often affects experienced workers and subordinates find it hard to
refuse requests from charismatic leaders.
 Solution: Set limits on over-scheduling and use resource leveling reports to
rebalance workloads.
 Calculations Involving Resource Capacity
 Example of group capacity calculation:
Group Capacity (hours)=Number of People×Hours/week×Number of weeks
  Adjust for holidays and vacations:
Adjusted Hours=Group Capacity−Holiday Hours−Vacation Hours
 Compare needed hours with available hours to identify shortfalls:
Ratio=Hours AvailableHours Needed
 Use of Project Software
 Start with PERT/CPM schedule.
 Assign resources based on priority rules when demand exceeds supply.
 Priority Rules for Resource Allocation
 Examples include:
 As soon as possible
 As late as possible
 Shortest task first
 Minimum slack first
 Most critical followers, most successors, and most resources first
 Trade-offs and Project Issues
 Common issues: unrealistic deadlines, frequent changes, and budgets.
 Managing these requires human decision-making and prioritization.

2. Differentiating Types of Organization and Its Application

(Note: The uploaded content does not explicitly detail organizational types or their
applications; however, some inferred points related to organizational behavior and project
resource management are below.)
 Organizational Influence on Resource Management
 Leadership style (e.g., charismatic VP) affects resource allocation and
scheduling challenges.
 Experienced workers often become bottlenecks due to overcommitment in
some organizational structures.
 Setting limits on workload and clear communication channels are crucial in
managing resource constraints across organizations.
 Linking Multiple Projects via Pseudoactivities
 Pseudoactivities (no resource requirement but have duration) help manage
multiple projects as a single entity.
  Useful in matrix or projectized organizations where multiple projects share
resources.
Crashing a project involves shortening its duration while managing the associated costs.
Here’s a structured approach to perform project crashing, including key formulas:
Steps to Perform Project Crashing
1. Identify the Critical Path:
 Determine the sequence of tasks that directly affect the project's duration.
Focus on tasks within this path for crashing.
2. Calculate Normal and Crash Costs:
 For each activity, gather the following data:
 Normal Duration: Time required to complete the activity without
crashing.
 Crash Duration: Minimum time achievable if the activity is crashed.
 Normal Cost: Cost incurred for the normal duration.
 Crash Cost: Cost incurred for the crashed duration.
3. Calculate Cost Increment:
 Calculate the cost of crashing for each
activity: Cost Increment=Crash Cost−Normal Cost
4. Determine Maximum Crash Days:
 Identify the maximum number of days each activity can be shortened:
 Maximum Crash Days=Normal Duration−Crash Duration
5. Rank Activities by Cost Efficiency:
 Calculate the cost per day of crashing for each
activity: Cost Increment per Day=Maximum Crash DaysCost Increment
 Prioritize activities for crashing based on the lowest cost increment per day.
6. Crashing Activities:
 Start crashing the activities with the lowest cost increment per day first,
focusing on the critical path.
 Monitor the total project duration and adjust accordingly to ensure the desired
completion time is achieved.
7. Update Project Schedule:
  After crashing each selected activity, recalculate the overall project duration
and update the critical path if necessary.
8. Cost Analysis:
 Keep track of the total cost incurred from crashing and evaluate if it aligns
with the budget constraints.
Example Calculation
 Activity D:
 Normal Duration: 6 days
 Crash Duration: 3 days
 Normal Cost: RM 12,000
 Crash Cost: RM 14,400
Cost Increment Calculation: Cost Increment=RM14,400−RM12,000=RM2,400
Maximum Crash Days: Maximum Crash Days=6−3=3 days
Cost Increment per Day: Cost Increment per Day=3RM2,400=RM800