Page 310 - Orlicky's Material Requirements Planning

CHAPTER 16 Project Manufacturing 289

■ Actual cost of work performed (ACWP)
■ Schedule variance (SV) BCWP – BCWS or expressed as a percentage SVP
SV/BCWS
■ Cost variance (CV) BCWP – ACWP or expressed as a percentage CVP
CV/BCWP
No matter what measures are used, it is critically important to evaluate the overall
performance of the project to learn what worked well and what could be improved for
the next product. Without this postmortem on a project, the lessons learned on one pro-
ject are likely to be learned over and over and over. Not only can the team learn from
things that have gone wrong and should be avoided in the future, but learning what went
well also helps the team to determine how to repeat the success. Identifying what could
be improved provides the opportunity to possibly avoid that situation in the future.

Divestment Phase
The divestment phase of a project manufacturer is the phase where the project team is
transitioned from one project to the next. Some companies will dedicate personnel 100
percent of the time to a particular project. When that project is completed, it is essential
to recognize the organizational and cost implications of having another project ready to
start. If the project team does not see another product for development available on the
horizon, there could be a tendency to stretch the current project out as long as possible.
This can contribute to cost overruns on the current project and adversely affect the prof-
its for this product. The divestment phase is a critical time that must be managed effec-
tively so that the organization can take from the lessons learned on the previous product
and apply them to the next product.

PROJECTS IN MRP

The role of MRP in project management is to provide the common information that sup-
ports detailed planning and integration from product design through manufacturing.
Product data management (PDM) is used frequently for design-cycle control, including
the initial design release, distribution of the desired design to suppliers and potential
multiple manufacturing sites, and managing changes that occur after the design release.
Incorporation of the PDM tool has been shown to provide a 15 to 20 percent improve-
ment in production cost by its linkages to the production engine. A full product lifecycle
management (PLM) approach facilitates tapping into innovation. Here, the improvement
to the enterprise can be several orders of magnitude. PDM and all its facets are beyond
the scope of this book. Technology at this writing is still evolving in this area, but this
promises to be a major focus for systems development in the next decade.
Linking the project management statement of work to MRP can be a challenge. The
normal process is to perform a one-way download of the project into the MRP system and
then begin to manage the project by exception only through MRP. However, very typical