Petersen General Contractors Case 8-1

1
Petersen General ContractorsCase 8-1

• Chapter 8
• PERT, CPM, Resource Allocation and GERT
• On-line MS Project Tutorials
• http//webcampus.stthomas.edu/s3c/Software/Project
  /ProjectEC_1a.html

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Team Alternative

• Form teams of five or fewer
• Identify the task of each team member
• Rate the contribution of each member

Teams 2,3,and 4
Team 1
3
Real World Considerations

• Other concurrent projects (size of total
  commitments)
• Coordinating with other companies (structure)
• Have you ever built a TV Tower? (technology)
• What is the basis for the estimators estimate?
• Is company experience still valid?
• Is 15 for contingencies still appropriate?

Technology
Thankfully this is not the real world.
4
Tasks with MS Project

• Team One
• Manage the other teams
• Do a post mortem
• Identify the benefits of a team approach
• Identify the issues encountered
• Characterize your team
• Team Two - At normal rate
• In how many days can the job be completed?
• What bid will yield a 10 pre tax profit?
• To reduce risk, what are the key tasks to watch?

• Team Three - At the fastest time
• In how many days can the job be completed
• What bid will yield a 10 pre tax profit?
• To reduce risk, what are the key tasks to watch?
• Team four -
• If cost is not a consideration, what else can be
  done to shorten the project?
• Address real world issues

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Deliverablesshort written reposts

• Team One - Reality of managing this project
• Teams Two and Three - MS Project based
  appropriate network diagrams for each time
  scenario identifying
• Key events
• Dependencies
• Cost estimates for each time scenario
• Team Four
• Using team one and two's analysis, provide a list
  of alternatives for
• Shortening the project if cost is not an object
• Further reducing costs
• Address the real world issues

6
FAQs

• Yes, you will work in teams
• Yes, this is a project within a project
• Others?

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Petersen General ContractorsCase 8-1

• the book answer

8
At a Normal Rate
j 35
e 85
h 38
i 8
v 35
k 8
cc 5
f 120
g 42
a 5
b 6
d 30
bb 8
15 aa
c 8
t 3
m 14
p 11
q 12
r 15
s 42
u 19
ee 5
n 34
1 29
0 9
3 w
12 x

• Time
• The critical path, a a-f-h-i-v-k-cc-ee 224 days
• Next longest path is a-b-c-l-n-m-p-q-r-s-u-ee
  200 days

15 y
9 z
3 dd
9
At a Normal Rate
500 Direct cost are 50

• Costs
• Total direct costs 364,050
• Direct labor 206,280
• Direct material 157,770
• Indirect costs _at_ 65 of direct cost
  600,682.50
• Contingency _at_ 15 of direct plus indirect cost
  690,784.87
• Bid with 10 profit 759,863.35

10
Shortest Possible Timesame path new time
j 35
29
e 85
h 38
i 8
v 35
k 8
cc 5
f 120
25
4
25
g 42
3
4
a 5
b 6
d 30
bb 8
15 aa
c 8
t 3
m 14
p 11
q 12
r 15
s 42
u 19
ee 5
n 34
1 29
30
14
0 9
3 w
12 x
15 y
9 z
3 dd

• Time
• The critical path, a a-f-h-i-v-k-cc-ee 191 days
• Second critical path is a-b-c-l-n-m-p-q-r-s-u-ee
  191 days

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Shortest Possible Timesame path new time, new
cost
Time is money

• Costs
• Total direct costs 383,813.20
• Direct labor 226,043.20
• Activities on the critical path increase
  16,320
• Activities on the second critical path 3443.20
• Direct material 157,770
• Indirect costs and contingency 728,285.54
• Bid with 10 profit 801,114.10
• (plus 41,250.25 for 35 days)

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What to Supervise More Carefully

• Near critical paths
• Areas of new technology or technique
• New staff
• High risk items
• Any high visibility items
• Others

Glass, china and reputation are easily broken And
never well mended. Ben Franklin
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If Shortest is Still Too Long

• Sub contract sub assemblies
• Buy a tower and transport it
• Others?
• Think out of the box

Some Leading Authors
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Idea-Based Leadership
Yes No

• Ensure the presence and respect for idea
  practitioners
• Set forth an idea strategy in a idea-friendly
  culture
• Be open to ideas and the people who suggest them
• Reward the practitioners
• Signal the importance of ideas

Source Whats the Bid Idea Thomas Davenport, and
Laurence Prusak with H. James Wilson
How does your organization rate and why
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Breaking Through to Innovation

• Technology arrangement of objects, ideas and
  people to accomplish a goal
• Technology brokering exploiting existing
  technologies to create new ones
• Innovation is not breaking free of the past it
  is harnessing the past in new ways

Your perspective and knowledge
Others perspective and knowledge
Source How Breakthroughs Happen Andrew Hargadon
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The Balancing Act
Actionable Dogma
New Ideas
Deep
Depth
Networking
Jack of all trades Master of none
Shallow
Source How Breakthroughs Happen Andrew Hargadon
Inside
Outside
Breath
"Knowledge" is both the raw material for
innovation and "comfort" that inhibit seeking
new opportunities outside of your comfort zone.
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The Rules

• Never forget the future is already here.
• Analogy trumps invention
• Find your discomfort zone
• Divided we innovate.
• Bridge to your strengths
• Build to your weakness
• Build teams
• As goes the individual, so goes the organization
• Rip, mix and burn

Source How Breakthroughs Happen Andrew Hargadon
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Efficiency Innovation Dichotomy
Innovation
Efficiency
Stay in Business
Todays Business Climate
Source Creating the Innovation Culture Frances
Hribe
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Honoring the Dissenters Foster Innovation

• Dissenters offer new ideas
• Force others to challenge their assumptions
• Dissent can
• Kill wrong or out of date ideas
• Tap into peoples tacit (gut) knowledge
• Break you out of a think rut

Source Creating the Innovation Culture Frances
Hribe
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How to Kill Dissent (Innovation) Without Really
Trying

• Best practices make the status quo better
• Treat everybody equally no one is a valuable
  resource who's ideas count
• Hire a mini me all run down the same train of
  thought
• Design a process for innovation oxymoronic?

Source Creating the Innovation Culture Frances
Hribe
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How to Foster Innovation

• Speak last in meetings
• Seek out dissenters view
• Protect the dissenter
• Help dissenter be heard
• Challenge the Status Quo

Minority Repots are a good thing
Source Creating the Innovation Culture Frances
Hribe
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80 /20 and You

• 19th Century Vilfredo Pareto
• A small minority (20) account for a majority
  (80) of the wealth

• 20th Century Joseph Juran
• Solving quality problems depends on
  differentiation the vital few cause from the
  trivial many.

Every job should leverage your 20 genius 80 of
the time
Source Richard Koch 80/20 Individual
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Out of the Box Thinking

• Budgets and Schedules
• Self Interest
• Silos and Turf
• Good Enough

• Problems Looking for a Solution
• If resources were no object
• Walk in the others shoes
• Solutions Looking for a Problem
• Where else would it fit
• Do it the opposite way

Source Why Not Bary Nalebuff and Ian Ayres
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Selling your Ideas

• Elevator pitch
• KISS keep is similar silly
• Know to whom to pitch
• Make it their idea

Source Why Not Bary Nalebuff and Ian Ayres
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The Capability to Innovate

• Process
• People
• Strategy and Customers
• Technology
• Measures and Performance

Source 24/7 Innovation Stephen M. Shapiro
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ProcessThe res

• Rethink
• Reconfigure
• Re-sequence
• Relocate
• Reduce
• Reassign
• Retool

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Phrase Problems in Ways They Can Be Solved

• How to. (H2)
• How might.. (HM)
• In what ways might.(IWWM)
• What might.(WM)

Source Dave Labno Innovation Consultant
Do it globally
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Slides not Used
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What would you do if you werent afraid?
Who Moved My Cheese
Source Spencer Johnson Who Moved My Cheese
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We all approach EC Change Differently

• Sniff Sniffs out the situation and sees early
• Scurry Goes into action immediately
• Hem Does not want to deal with change and stays
  in familiar territory
• Haw - Sees what he is doing is wrong, laughs at
  himself, and finally changes

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Haws Writing on the Wall

• Change happens, they keep moving the cheese
• Anticipate change get ready for the cheese to
  move
• Monitor change smell the cheese often
• Adapt to change quickly
• Enjoy change savor the adventure
• Be ready to change quickly and enjoy it again.
  They keep moving the cheese

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The Johari Window
Hidden
Open
Tell
Known
Know to Self
Ask
Blind
Unknown
Unknown
Unknown
Known
Known to Others
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Pareto Yesterday and Today
Managerial Capitalism
Individualism

• Corporations created wealth
• Jobs are repetitive labor intensive
• Managers Theory X
• Shareholders consume wealth
• Capital is king
• Centralized planning yields strategic goals
• Economies of scale and mass production
• Mangers are focus of power

• Individuals create wealth
• Few employees creative imagination
• Coaches - Theory Y and Z
• Venture capitalist and entrepreneurs share the
  wealth
• Creativity is critical element
• Agility contractual relationships
• Mass customization
• Companies reunite ownership and control

Source Richard Koch 80/20 Individual
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Customer Strategies

• Add more value
• Listen
• Serve
• Hire

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Creating a Culture of Innovation

• Envision
• Enable
• Explode
• EmpowerTool

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Technology and Innovation

• Create a virtual enterprise
• Change the rules of the game
• Collaborate across the value chain
• Increase the knowledge of employees
• Launch new businesses

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Getting There

• Alliance Based
• Capability Bases
• Process Dominated
• Process Driven
• Process Sensitive
• Functionally Bound

Stages