Project Management - Terms

Is a house renovation a project or an operation?

• project

• operation

• both

• neither

Answer explanation

A house renovation is a project, because it is custom and temporary in nature. It has a start and an end date, and the process is not repeated.

A factory has received a rush order for 100,000 units of toilet rolls for delivery on the 1st of next month. Should the factory setup a project team to run a temporary emergency project to quickly manufacture the 100,000 units, or order the operations division to manufacture 10 batches 10,000 units each?

• Commence a special

  project to ensure this order is delivered on time.

• Order operations to produce the units in 10 batches of 10,000 each.

• Reject the order due to time constraints.

Answer explanation

Manufacturing of repeat products is manged by the operations division of a company, not as part of a special project. Operations may manufacture products in batches. In this case, 10 batches of 10,000 units may need to be scheduled. Operations may have multiple, existing orders from other clients that also need to be scheduled, according to pre-established operational rules. These rules may take into account variables such as dead-line, order size, priority and FIFO (first-in, first-out), amongst others.

The operations division have identified the need to reorganise the manufacturing layout of the factory for greater efficiency, with a 25% improvement expected. Operations wants to take care of this during after-hours each night over a period of one month. However, the general manager instead wants to form a new project team to manage the reorganisation, which may result in a shut-down of operations for up to one week during work-hours, and is estimated to require a budget of 50k. What decision should the Managing Director make?

• The operations division can take care of the reorganisation after hours as they know the equipment best and can do it cheaply without the need for any shut-down.

• A new project team should be formed to plan, allocate and execute the reorganisation, at a cost of 50k and potentially a one week shut-down.

• Nothing should be done, as the shut-down will not worth the improvement in efficiency.

• A commitee should be setup to research the best approach before making a decision.

Answer explanation

Reorganising operations during after hours is a huge risk to product quality and will very likely take longer than expected. It is also a high-risk strategy, as clearly little planning has been done and no estimate of costs has been given. It is also unclear how the reorganisation could be done bit by bit without affecting current operations.

The best approach of those shown is to setup a project, with allocated funds and a team that can initiate, plan and execute on the reorganisation.

A 25% improvement means that doing nothing is very likely not going to be the best decision, as this is a large improvement.

It is reasonable to undertake more research via a committee, before making the decision. However, the Managing Director may simply opt to authorise the project given the large improvement expected.

What is a deliverable?

• The final output transferred to the customer or to the organisation.

• The desired operational results achieved.

• A tangible component or product, document or intangible service or result.

What is a project benefit?

• The desired operational result achieved from the deliverables.

• A description of how to undertake the project work to achieve the project goals.

• An advantage accruing from an outcome of a project.

• A tangible product, document or an intangible service or result.

What is a project objective?

• Describes the purpose for which the project was created.

• description of how to undertaken the project work.

• A tangible component or product.

• The final outputs transferred to the customer.

What does an engineering manager do? Order the following:

• PLANNING

• ORGANISING

• ALLOCATING RESOURCES

• CONTROLLING ACTIVITIES

• DIRECTING

Answer explanation

These are from our definition in the first lecture.

Engineering management is the art and science of planning, organising, allocating resources, and directing and controlling activities that have a technological component.

American Society of Engineering Management

What is the 1st of the three levels of planning?

Answer explanation

Planning can be at three levels, strategic, tactical and operational.

What type of organisational structure is this?

• Functional

• Project

• Matrix

• Departmental

Answer explanation

A matrix organisation is a mix of functional and project organisations, where departments and project managers appear in the organisational structure.

Which organisational type has the following disadvantage: "No home for team members once a project is complete".

• Departmental

• Project

• Matrix

• Functional

Answer explanation

Once a project is complete, team members may have no role or department within the organisation to return to.