Project Management (x470) Module 02 : Knowing What the Project Is, Part 1

Class Road Map Foundational Concepts Knowing WHAT the Project Is Session 1 Foundational Concepts Sessions 2 & 3 Knowing WHAT the Project Is Session 4 Knowing WHERE the Project Is Session 5 Closure, Group Presentation, Advance Topics

Knowing WHAT the Project Is Session 2 Agenda Short Quiz 1 Questions / Review - Session 1 concepts Short Quiz Knowing WHAT the Project Is Scope Team Sessions Scope Statement WBS

Monitoring and Control Project Genesis Monitoring and Control Project Drivers Problems Opportunities Business requirements Project Approval Formal “Go” decision Project Charter Project Manager assigned Project Plan Clear and approved project or phase definition Stakeholders Scope (Deliverables) Schedule Cost Knowing WHAT The Project Is

Project Approval (Initiation) Challenges No formal project approval (initiation) process Unrealistic expectations and assumptions Timing of Project Manager engagement Degree of accuracy for project and product documents Speed vs Accuracy vs Change Control culture Functional Areas’ Concern: Spending precious resources’ time on projects that will be disapproved

Project Approval “Monitor & Control” Aspects Project documentation intensity / rigor. Factors: Duration Cost Project risk Priority / importance Project classification Small, Medium, Large Standard, Light, Tracking “Project” definition Projects or investments Project approval process Project classification Strategy alignment Functional group Others

Knowing What the Project Is: Planning Fundamentals If project deliverables are clear, much of the work can be pre-planned (Linear Project Life Cycle approach) If project deliverables are not clear, initial work should focus on a set of deliverables that will either provide clarity in the scope or are pre-agreed upon (Iterative, Adaptive, Extreme Project Life Cycle approaches) The more uncertain the deliverables, the greater the need is for frequent “validation cycles” Do detailed planning only up to the next point of knowledge “Failing to plan is planning to fail.” - Harold Kerzner

Project Life Cycle Approaches Unclear Q4: Unlikely Situation Solution looking for a problem Q3: Extreme Approach Nothing about the project is certain Product is accepted after some iterations or pulls plug R & D GOAL Q1: Linear Approach Low complexity Well understood technology Low risk Completed similar project Q2: Adaptive / Iterative Approach Product development and process improvement Production prototype development Clear Unclear Clear SOLUTION / REQUIREMENTS

Lifecycle Approaches Uncertainty & Complexity UNCLEAR Extreme UNCERTAINTY & COMPLEXITY INCREASES GOAL Linear Iterative / Adaptive CLEAR CLEAR UNCLEAR SOLUTION & REQUIREMENTS

Adaptive / Iterative Life Cycle Model High Level Scope Cycle Scope Cycle Plan Cycle Execute Cycle Close Post Cycle Review Next Cycle? Close Project

Fast Tracking & Rolling Wave Planning practice of overlapping phases a.k.a concurrent engineering Phase 1 Phase 2 Phase n Rolling wave planning – progressive detailing of the project plan that indicates iterative and ongoing nature of planning. Near-term deliverables identified at a low-level view of detail, long-term deliverables identified at a high-level view of detail (Iterative, Adaptive, Extreme Life Cycle Approaches)

Knowing What the Project Is: Project Planning Scope Objective: Identify all the work required, and only the work required, to complete the project successfully Deliverables: (1) Scope Statement (2) Work Breakdown Structure Schedule Objective: Determine the time required to meet the project needs Deliverables: (1) Project Schedule (2) Project Milestone Cost Objective: Identify the funding needed to meet project goals /deliverables Deliverable: Project Cost Baseline Stakeholder Management

Knowing What the Project Is: Scope Planning Steps Objective: Identify all the work required, and only the work required, to complete the project successfully Stakeholder Register Project Charter Collect Requirements Product Needs Project Mgm’t Needs What should be the main concern in defining a project initially? Should we be too concerned about the schedule and cost when defining the project scope? Define Scope Create WBS Scope Statement Work Breakdown Structure Validate Scope Approved Scope Documents

Knowing What the Project Is: Project Scope Statement Product scope description Characteristic of the product that the project will produce Project life cycle approach Deliverables List of sub-products whose full and satisfactory delivery marks project completion. Usually includes milestone deliverables. Product acceptance criteria Successful completion metrics Project exclusions Project assumptions and constraints Sponsor approval

Knowing What the Project Is: Assumptions, Constraints Factors that are considered to be true, real, or certain for planning purposes Generally involves a degree of risk Constraints Factors that limit the project team’s options

Team Work Use the workbook template. Draft a Scope Statement for your project (30 minutes) Use the workbook template.

Knowing What the Project Is: The Work Breakdown Structure Collect Requirements Define Scope Create WBS Validate Scope

Knowing What the Project Is: Decomposition Definition: Steps: Subdivision of major project deliverables or sub-deliverables into smaller, more manageable components until the deliverables are defined in sufficient detail to support development of project activities (planning, executing, etc..) Identify major project deliverables Decide if adequate cost and duration estimate can be made at this level of detail for each deliverable Identify constituent components of the deliverable if necessary Verify correctness of decomposition (necessity, definition, cost, duration, responsibility)

Knowing What the Project Is: Work Breakdown Structure A deliverable oriented grouping of project components that organizes and defines the total scope of the project Defines products, not tasks Can be developed using a top-down or bottom-up approach Can be hardware-related, function- related, life cycle-related or a combination Foundation of all planning!

Knowing What the Project Is: Work Package Lowest level deliverable in a WBS Work effort guideline - 80 to 150 hours Ownership assigned at this level Tasks are identified under this level Task size guideline - not to exceed 80 hours; less for high risk project

Knowing What the Project Is: WBS Template Project Name Phase 1 Phase 2 Phase ‘n’ Deliverable 1 Product Process Deliverable 2 Project Management Process Deliverable N-1 Deliverable N

Knowing What the Project Is: Scope Baseline Scope Statement WBS Other Reasons: No attempt made to systemize the planning process Planning was performed by a planning group No one knows the ultimate objectives No one knows the major milestone dates Project estimates are best guesses and are not based on any standards, or history No one bothered to see if there would be personnel available with the necessary skills People not working towards the same specs Constant shuffle of personnel in and out of the project with little regard for the schedule Change of management and their objectives. Change(s) in the macro environment

Knowing What the Project Is: Requirements Challenges May not be fully known at the start of a project May come from multiple sources / groups May come at various levels of details Some stakeholders may not be known initially May be “wants” and not “needs” Wants - usually more associated with a solution Needs - usually more associated with the underlying problem May conflict with each other May feed off each other Usually requires iterations and trade-offs to finalize May change

Project Monitoring and Control: Project Flexibility Matrix High Medium Low Scope Time Cost

Knowing What the Project Is: Scope Determination Summary Make sure project stakeholders have all been identified Functional groups that will have a deliverable on the project should be represented on the project team WBS should represent only the work needed to complete the project successfully Validate the Scope baseline documents with the project sponsor or approving authority Process iteration is the norm

Team Work (60 minutes) Construct a life-cycle based WBS for your project Use a Post-It-Note sheet for each deliverable Concentrate on product deliverables but add project management process deliverable that have already been discussed in class

For Next Meeting Short Quiz Team presentation (15 minutes each): Stakeholder Satisfaction Matrix Lifecycle Scope Statement WBS

Knowing WHAT the Project Is Session 3 Agenda Short Quiz 1 Questions / Review - Session 2 concepts Short Quiz Knowing WHAT the Project Is Schedule (Critical Path Calculations) Cost Team Sessions Project Schedule Cost Baseline

Knowing What the Project Is: Schedule Planning Steps Objective: Determine the time required to meet the project needs Define the Tasks Comprising the Work Package Sequence the Tasks or / and Deliverables Estimate the Tasks or Deliverable Resource Estimate the Tasks or Deliverable Duration Develop the Schedule

Knowing What the Project Is: Project Schedule Should include planned start and finish dates for each deliverable / activity. Tabular form Graphical form Bar / Gantt Chart Milestone chart Network diagrams

Knowing What the Project Is: Bar (Gantt) Charts

Knowing What the Project Is: Milestone Chart

Knowing What the Project Is: Task Sequencing Objective: Identify interdependencies among tasks / deliverables Define the Tasks Comprising the Work Package Sequence the Tasks or / and Deliverables Estimate the Tasks or Deliverable Resource Primary Deliverable: Project Schedule Network Diagram Estimate the Tasks or Deliverable Duration Develop the Schedule

Knowing What the Project Is: Activity Dependency Mandatory – inherent in the nature of the work being done, a.k.a. hard logic Discretionary – defined by the project team, a.k.a. preferred logic, preferential logic, soft logic External – involve relationships between project activities and non-project activities

Knowing What the Project Is: Scheduling Techniques Gantt or bar charts Milestone charts Networks (show interdependencies) Precedence Diagram Method (PDM) Arrow Diagram Method (ADM)

Knowing What the Project Is: Precedence Diagramming Method Method of constructing network diagram that uses boxes (nodes) to represent activities and connects them with arrows to show dependencies a.k.a. Activity On Node (AON)

Knowing What the Project Is: Precedence Relationships (1 of 2) FINISH START Eqpt Rcvd Eqpt Inspected FINISH-TO-START START Wall Preparation START-TO-START START Wallpapering START Production Burn-In START-TO-FINISH FINISH Operational Acceptance

Knowing What the Project Is: Precedence Relationships (2 of 2) FINISH FINISH Wall Preparation FINISH-TO-FINISH Wallpapering Network Requirements PERCENT COMPLETE 50 % 20 % Network Design

Knowing What the Project Is: Node Activity Information EARLY START 01/06/12 TIME DURATION 2 WORK-WEEKS EARLY FINISH 14/06/12 ACTIVITY 4 $250,000 SLACK COST/PROFIT CENTER 2810 LATE FINISH 28/06/12 LATE START 15/06/12

Knowing What the Project Is: Precedence Network Early Start Duration Early Finish B Late Start Slack Late Finish Early Start Duration Early Finish D Late Start Slack Late Finish Early Start Duration Early Finish E Late Start Slack Late Finish Early Start Duration Early Finish F Late Start Slack Late Finish Early Start Duration Early Finish A Late Start Slack Late Finish Activity Preceding Activity A B C D E C, D F Early Start Duration Early Finish C Late Start Slack Late Finish

Knowing What the Project Is: Resource Estimating Objective: Estimate the type and quantities of materials, people, equipment or supplies required to complete each task or deliverable Primary Deliverable: Task / deliverable resource requirements Secondary Deliverable: Resource Breakdown Structure Define the Tasks Comprising the Work Package Sequence the Tasks or / and Deliverables Estimate the Tasks or Deliverable Resource Primary Deliverable: Project Schedule Network Diagram Estimate the Tasks or Deliverable Duration Develop the Schedule

Knowing What the Project Is: Resource Considerations People, material, equipment, supplies Time / Skill and other trade offs Resource requirements including timing Resource Organizational Matrix

Knowing What the Project Is: Duration Estimating Objective: Determine the work period required to complete the task or deliverable with the estimated resources Primary Deliverable: Task / deliverable resource requirements Secondary Deliverable: Resource Breakdown Structure Define the Tasks Comprising the Work Package Sequence the Tasks or / and Deliverables Estimate the Tasks or Deliverables Resource Primary Deliverable: Project Schedule Network Diagram Estimate the Tasks or Deliverables Durations Primary Deliverable: Task / deliverable duration estimate Develop the Schedule

Knowing What the Project Is: Duration Estimating Techniques Expert judgment Analogous estimating Parametric estimating Three-point estimating Reserve time (contingency)

Knowing What the Project Is: Analogous Estimating Use actual duration of a previous similar activity as basis to estimate duration of the future activity Approximate (rule of thumb) estimate Made without any detailed engineering data A.k.a “Top-down estimating”

Knowing What the Project Is: Parametric Estimating Quantities to be performed for each work category defined by the engineering/design effort multiplied by the productivity unit rate Example: No. of drawings x no. of hours per drawing

Knowing What the Project Is: Three-Point Estimating O - Optimistic completion time estimate M – Most likely completion time estimate P – Pessimistic completion time estimate Task Duration = (O+4M+P)/6

Knowing What the Project Is: Schedule Development Objective: Create project schedule based on activity/deliverable sequences, resource and duration estimates, and schedule constraints Primary Deliverable: Task / deliverable resource requirements Secondary Deliverable: Resource Breakdown Structure Define the Tasks Comprising the Work Package Sequence the Tasks or / and Deliverables Estimate the Tasks or Deliverable Resource Primary Deliverable: Project Schedule Network Diagram Estimate the Tasks or Deliverable Duration Primary Deliverable: Task / deliverable duration estimate Primary Deliverable: Project Schedule Baseline Secondary Deliverable: Milestone Schedule Develop the Schedule

Knowing What the Project Is: Critical Path and Float Longest time span through the total system of activities / events Delay in any activity / task in the critical path delays the whole project Improvement in total project time means reducing time for activities / events in the critical path Slack Time (Float) - Time differential between the scheduled completion date and the required date to meet critical path.

Knowing What the Project Is: Critical Path Calculation Forward Pass Calculates early start and early finish dates Project end date Longest path Backward Pass Calculates late start and late finish dates Task / project float Identifies tasks in critical path Determined by doing forward and backward pass calculations

Knowing What the Project Is: Forward Pass The first predecessor task(s) have an Early Start (ES) of zero Early Finish (EF) dates are calculated by adding the task duration (TD) to the earliest date (ES) a task can start The EF date of the predecessor becomes the ES date for the successor When there are multiple predecessors, ES is the larger of the EFs for the task

Knowing What the Project Is: Backward Pass Late Start (LS) and Late Finish (LF) dates are calculated starting from the end of the project LS is calculated by subtracting the TD from the LF of the task LS for the successor task becomes the LF for the predecessor task When there are multiple successors, LF is the smaller of the LSs

Knowing What the Project Is: Critical Path and Float Task Float = Late Finish – Early Finish Those tasks with zero float are on the critical path

Critical Path Exercises Refer to your PM Workbook.

Knowing What the Project Is: Schedule Development Considerations Life Cycle Approach Constraints Imposed dates on activities (start/finish) Key events / major milestones Leads and lags: dependency relationship among activities Schedule compression Crashing Fast Tracking

Adaptive / Iterative Life Cycle Model High Level Scope Cycle Scope Cycle Plan Cycle Execute Cycle Close Post Cycle Review Next Cycle? Close Project

Team Work Determine the Schedule for a phase of your project (20 minutes)

The Budget Trap

Knowing What the Project Is: Cost Planning Steps Objective: Identify the funding needed to meet project goals / deliverables. Estimate Cost WBS Resource Plan Project Schedule Work Package cost estimate Determine Budget Project budget estimate Cost Baseline

Knowing What the Project Is: Cost Estimating Techniques Expert judgment Analogous estimating Parametric estimating Three-point estimating “Bottom-Up” Estimating Reserve Analysis (contingency)

Knowing What the Project Is: Analogous Estimating Use actual cost of a previous similar project to estimate cost of current project Approximate (rule of thumb) estimate Made without any detailed engineering data Top-down estimating Accuracy +- 15%

Knowing What the Project Is: Parametric Modeling Use project parameter in a mathematical model to predict project cost Made without any detailed engineering data Order of magnitude estimate May use past experience Accuracy +- 35% within the scope of the project Example: construction cost per square foot Examples: Regression Analysis (Scatter diagram) Learning Curve

Knowing What the Project Is: Bottom-Up Estimating Cost estimate of WBS work packages rolled up to a project total Definitive/detailed estimate Prepared from well-defined engineering data, vendor quotes, unit prices, etc. Accuracy +- 5%

Knowing What the Project Is: Cost Baseline Time-phased budget for measuring, monitoring and controlling overall project cost performance Question: Should you accept project budget (and schedule) from management without the benefit of cost processes covered? Cumulative Amount Time

Knowing What the Project Is: Project Crashing Costs ALL ACTIVITIES CRASHED CRASH B 160,000 150,000 CRASH E 140,000 CRASH F PROGRAM COST, $ CRASH A 130,000 NORMAL OPERATIONS 120,000 110,000 10 12 14 16 18 20 22 24 PROJECT COMPLETION TIME, WEEKS

Knowing What the Project Is: Current Costing Practice Shows monthly cash flow Identifies capitalized vs. operating

Knowing What the Project Is: Planning Best Practices Summary Determine appropriate project life cycle approach Use Scope Statement / WBS to baseline project scope Develop a project schedule to baseline project time Develop a cost baseline Focus is more on “knowing what the project is” Partner with line managers to get agreement on scope, time and cost baselines Change control process should be in place as soon as possible Validate progressive elaboration outputs

PMBOK Guide: Knowledge Area Processes I

PMBOK Guide: Knowledge Area Processes II

Team Work Determine cost baseline for a phase of your project (40 minutes)

For Next Meeting Critical Path Homework Due (Workbook 6.3.1) Short Quiz Cost Baseline Earned Value Management (Mod 04 Knowing Where the Project Is) Mod 03 Knowing What the Project Is Part 2 Bring 3x5 Post-It Note