Project Management


A project is any group of activities with a common goal, for which we try to control costs, resource usage, completion time, and quality of the output. However, large (one-time or multiple) projects in the range of millions to hundreds of millions of dollars are more common and undoubtedly have a larger total economic impact. Examples include new plants, schools, office buildings, research programs, some types of electronic research and development, bridges, and highways. Projects in the thousands to one million dollar range are even more numerous and include building houses, remodeling offices, modernizing wiring and plumbing, establishing a small PC cluster, and so on. Small and very small projects are too numerous to try to catalog. For example, getting to work in the morning can be considered a project, with such activities as shower, brush teeth, put on shoes, dry hair, and so on.

 Project management is a broad multi-level activity which involves strategic planning, middle- and short-term planning, scheduling, and control. We will first give a broad introduction to project management at all levels from strategic planning to control. Next we present the foundation of project scheduling without considering resource constraints. Then we consider the case of project scheduling with resource constraints from several points of view. Finally we discuss broader issues surrounding scheduling such as project design and strategic project control.

 Most of the formal work in project management has focused on large one-time projects. Project management tends to be a very involved process, requiring the careful coordination of experts in a number of areas. It is important that the individual parts of the process be carefully organized. It requires developing and manipulating a great deal of data and reports. The scheduling and control portion of project management have benefited greatly from the PC revolution.

 My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight

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Company Performance Appraisal


Company performance appraisal studies the trends of specific profitability and productivity ratios derived from financial statements for at least past three  periods (year, quarter, month). Its main purpose is to diagnose problem areas through establishing productivity indicators for continuous monitoring and control of the whole enterprise, in order to set up an appropriate productivity improvement programs.

 

In conducting company performance appraisal, two basic comparisons have to be made:

a.       Between current performance and a historical base performance;

b.       Between actual performance and the target.

 

The former indicates whether performance is improving or declining and at what rate. The latter requires that performance or productivity targets be set and matched against actual performance.

 

Using profitability along as the basis for evaluating the overall performance of an organization makes it difficult to identify the cause of profitability changes. Are they due to productivity or price-cost movement? The following demonstrates this relationship:

 

            Output value     =          Quantity sold     X          Unit price

 

 

             Profitability       =          Productivity       X          Price recovery

 

 

             Input value        =          Quantity used    X          Unit cost

 

Considering the relationships over time, profitability is defined as charge in output value compared with change in input value; productivity as the change between quantity of output and/or quantity in unit price, and change in unit cost.

 

In effect, what is computed are performance ratios classified into:

  • Change in profitability;
  • Change in productivity;
  • Change in price recovery.

 These performance ratios are then evaluated in relation to their effect on profits. In general, a drop in profitability, in productivity or in price recovery reduces profits. Lower productivity signals a need for further analysis and for correction action. However, increased productivity does not necessarily lead to profitability on a short-term basis. The effect of increased productivity will be realized only in terms of long-term profitability.

 My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please contact www.asifjmir.com, Line of Sight

Recovery of Loss-making Companies


A surprising number of large companies have one or more subsidiaries making losses at any time. The number of private companies which fail is further ample proof of loss-making businesses. One response is a desire to sell the loss-making business, which is really an attempt to walk away from a situation which is both a problem and an opportunity. Even if a buyer is found, the purchase price is likely to be lower than net asset value. If loss-making business is sold to the existing management interesting questions are raised. What will they do as owners of the business different from before? Why was this not done at the direction of the group previously? The opportunity is to turn the business into profit before considering selling it, because even if a sale makes sense, it will be easier to achieve and a much higher price should be obtained.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please contact www.asifjmir.com, Line of Sight