Tuesday, August 29, 2006

Reducing Project Duration

Reducing project duration:

We design or select the projects that have time, cost, and resource suitable with our financial ability, our times and our resources available. Those three things very important and very closely with each other:

Reducing Time --> Using more Resources --> Cost will be increased

Reducing Resources --> Reducing direct cost --> Extending times.

Reducing the time of a critical activity in a project can be done but almost always results in higher direct cost.
When we reduce the time of a critical activity, the project’s critical path can be change with other activities and that new path will determine the new project completion date.
We have some effective methods to reduce project duration:

*Adding Resources: This is popular method to reduce project’s time by assigning additional staff and equipment to activities.

*Outsourcing Project work: A common method for shortening the project time is to subcontract an activity. The subcontract may have access to superior technology or expertise that will accelerate the completion of the activity.

*Scheduling Overtime: The easiest way to add more labor to a project is not to add more people, but to schedule overtime.
Other methods such as: Establish a core project team, Do it Twice-Fast and Correctly, Fast-Tracking, Critical-Chain, Reducing Project Scope, Compromise Quality.

The challenge for the project manager is to use a quick, logical method to compare the benefits of reducing project time with the cost. Critical activities are searched to find the lowest direct-cost activities that will shorten the project duration. Total cost for specific project durations are computed and then compared with the benefits of reducing project time before the project begins or while it is in progress.

Project Cost: the total cost for each duration is the sum of the indirect and direct costs. Indirect costs continue for life of the project, any reduction in project duration means a reduction in direct costs. Direct costs reduce from the project original planed duration, the sum of the costs of all the work packages or activities represents the total direct costs for the project.

Application: Depend on the situation of the company (resources available) and the industry, the project manager have decision to manage his project. The project duration can be extended or reduced base on the profit and the costs according to that project.
The project manager flexible to make decision to get the optimal profits with the lowest costs in the limit times

3 Comments:

At 4:42 AM, Blogger Tracey said...

You have worded your write up in a very clear and concise manner that anyone not on only a project related person would understand. Thank you

 
At 7:53 PM, Blogger Erik_Gar500 said...

Thank you. This blog is helpful to me I am taking project management classes this will be good review for upcoming exams.

 
At 11:59 AM, Blogger lee pzi wei said...

Thank you~I'm takng project management course..your idea is so good to help me in cost and budget management assignment..thank you=)

 

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