Production & Operations Management Final Exam Flashcards: Chapter 7

Project
An interrelated set of activities with a definite starting and ending point, which results in a unique outcome for a specific allocation of resources
Project management
A systemized, phased approach to defining, organizing, planning, monitoring, and controlling projects
Program
An interdependent set of projects that have a common strategic purpose
Work breakdown structure
A statement of all work that needs to be completed
Activity
The smallest unit of work effort consuming both time and resources that the project manager can schedule and control
Network diagram
A network method designed to depict the relationships between activities, consists of nodes/circles and arcs/arrows
Program evaluation and review technique (PERT)
A network planning method created for the Navy’s Polaris missile project in the 1950s, involved 3,000 separate contractors and suppliers
Critical path method
A network planning method developed in the 1950s as a means of scheduling maintenance shutdowns at a chemical processing plant
Path
The sequence of activities between a project’s start and finish
Critical path
The sequence of activities between a project’s start and finish that takes the longest time to complete
Activity slack
The maximum length of time that an activity can be delayed without delaying the entire project (S = LS – ES or S = LF – EF)
Gantt chart
A project schedule, usually created by the project manager. It projects activities and their relationships on a timeline of estimated duration times
Normal time
The time necessary to complete an activity under normal conditions
Normal cost
The activity cost associated with normal time
Crash time
The shortest possible time to compute an activity
Crash cost
The activity cost associated with crash time
Minimum cost schedule
Determined by starting with the normal time schedule and crashing activities along the critical path, in such a way that the costs of crashing don’t exceed the savings in direct and penalty costs
Risk management plan
A plan that identifies the key risks to a project’s success and prescribes ways to overcome them
Time estimate formula
TE = (a + 4m + b) / 6
a
Optimistic time: the shortest time in which an activity can be completed, if all goes exceptionally well
m
Most likely time: the probable time required to complete an activity
b
Pessimistic time: the longest estimated time required to complete an activity