Management and Administration Flashcards
Cost-benefit analysis
- estimates the total monetary value, costs and benefits, of a project.
- typical for public projects (highways, public facilities)
- social and environmental benefits and costs must be given monetary values.
- set for particular time and location
- compare current situation with proposed project
History: Jules Dupuit conceived of it in 1848. Federal Navigation Act of 1936 required US Army Corps of Engineers waterway system projects to have benefits exceeding costs
Cost-effectiveness Analysis
- selecting among competing projects when resources are limited
- (Cost of new strategy - cost of current pracctice) / (effect of new strategy - effect of current practice)
- CE ratio can help determine which option is most effective
developed by the military
net present value
- calculates the net monetary value of a project
- discounted to today’s present value
- NPV > 0 means monetary benefit outweights its monetary costs
- need to know: years of the project’s lifespan, quantified monetary benefits, monetary costs, and interest rate
Internal Rate of Return
- evaluation of financial benefit of a project
- NPV = 0, interest rate blank
- if IRR is greater than available market interest rate, the project is financially beneficial
Goals Achievement Matrix
GAM
- comprehensive way to evaluate different projects
- table that lists projects in rows and evaluation criteria in columns
- score each project against evaluation criteria and compare
Gantt Chart
- focuses on sequence of tasks neccesary for project completion
- x-axis is time scale
- each task is a single horizontal bar
- length of bars correspond to duration of task
- often show dependency, when one task cannot begin until another is completed
Linear Programming
- attempts to find optimum design solution for a project
- takes a set of decision variables, within constraints, and generates an optimum design solution
Program Evaluation and Review Technique
PERT
- scheduling method; large scale project
- graphically illustrates the interrelationships of project tasks
- good when precise time estimates are not available for project tasks
- steps: identify the specific activities and milestones; determine the proper sequence of activities; construct a network diagram; determine the critical path; update the PERT chart as the project progresses
History: developed in the 1950s by the US Navy
What are the steps of the Program Evaluation and Review Technique (PERT)?
- identify the specific activities and milestones
- determine the proper sequence of activities
- construct a network diagram
- determine the critical path
- update the PERT chart as the project progresses
Critical Path Method
CPM
- project analysis tool, large-scale projects
- generates a “critical path” through the project tasks
- each tasks has a known amount of time to complete
- tasks cannot be completed before the previous one
- longest path is the critical pathway
What does effective management of a planning organization require consideration of?
- organizational form
- human resources
- administrative operations
- strategic planning
- budget and finance
horizontal/flat organizational structure
- few or no levels of management between management and staff level employees
- less supervision
- employees more involved in decision-making process and have greater responsibility
- pros: can increase efficiency, reduce costs, and speed up commmunication without excess maangement
- cons: employees may lack a clear sense of directive or job duties; employees tend to be generalists rather than deep knowlege in a few subject areas; potential for power struggles over decision-making authority
- better for small organizations
Verticial/heirarchical organizational structure
- resembles a pyramid
- each employee subordinate to someone else except at top
- pros: clear sense of leadership and their level of responsibility on each task and project; promotional opportunities for employees to move “up”; employees can develop expertise in one area resulting in specialists; departmental loyalty
- cons: departments may not communicate well and rivalries could develop; more bureacracy which can slow responsiveness; could be more expensive with more mangagement
Is a horizontal or vertical structure better for larger companies?
vertical
Are specialists more likely to develop in horizontal or vertical organizational structures?
vertical