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GBA: Global Operations and Project Management

GBA · Work through your exam, one topic at a time.

All guide sections

Global Operations and Project Management

What this domain tests

Global Operations and Project Management tests capacity and footprint decisions, and whether you can run earned-value arithmetic and interpret schedule and cost indices correctly.

Core rules and concepts

  • Footprint decisions - location drivers (market access, cost, skills, incentives, risk), total landed cost, and the trade-off between concentration (scale) and dispersion (resilience).
  • Postponement and decoupling - hold inventory in generic form and differentiate late to absorb demand variance.
  • Lean versus agile - lean suits stable, high-volume flows; agile suits volatile, high-variety demand; most global networks are hybrid.
  • Quality - ISO 9001 for the management system, Six Sigma for variance reduction, TQM for culture; these are not interchangeable.
  • Project baselines - WBS, critical path (longest path, zero float), PERT for uncertainty.
  • Earned value - PV, EV, AC; CV = EV - AC; SV = EV - PV; CPI = EV/AC; SPI = EV/PV; EAC = BAC/CPI when current cost performance is expected to continue; VAC = BAC - EAC.
  • Governance - stage gates, risk registers, PMO escalation routes, and change control that protects the baseline.

Worked example

A plant relocation project: BAC = $1,000,000, PV = $400,000, EV = $360,000, AC = $390,000. CV = 360,000 - 390,000 = -$30,000 (over budget). SV = 360,000 - 400,000 = -$40,000 (behind schedule). CPI = 0.923 and SPI = 0.90. EAC = 1,000,000 / 0.923 = $1,083,333; VAC = -$83,333. Forecast roughly 10% late and 8% over budget if nothing changes. Because both indices sit below 1, the likelier causes are scope growth or productivity, not a price shock - investigate before re-baselining. Options: crash the critical path (recovers time at a cost), fast-track parallel activities (raises risk), or descope with sponsor approval.

Traps that cost marks

  • Computing SV from percentage of time elapsed instead of earned value.
  • Reading SPI above 1 with CPI below 1 as good news.
  • Treating float on a non-critical path as slack for the whole project.
  • Re-baselining to hide variance rather than to reflect approved change.
  • Omitting ramp-up, customs clearance and permitting from footprint timing.