1. OPMA 5364 Project Management Part 4 Starting & Planning a Project

2. Topic Outline: Starting & Planning a Project
Project launch meeting
Identifying necessary activities
Work Breakdown Structure (WBS)
Estimating activity durations
Identifying necessary resources
Project budgeting
Top-down vs. bottom-up approaches
Project planning exercise
Learning curves
Project action plan
Responsibility chart
Interface map
Part 4 - Project Planning

3. Project Launch Meeting
PM should first meet with the senior manager who will be responsible for the project. Why?
Next, a project launch meeting should be held.
What is the purpose of this initial meeting?
Who should be invited?
What should be the results of this meeting?
Part 4 - Project Planning

4. Project Planning Process
Clearly define project objective (scope)
Develop a Work Breakdown Structure (WBS)
Estimate time needed for each task
Determine resources needed for each task
Estimate cost needed for each task
Develop project schedule and budget (adjust as needed)
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5. Part 4 - Project Planning
Project Scope
A clear project scope definition provides the guidelines that are used to develop your project plan.
Project Scope Checklist:
Project objectives (purpose, due date, budget)
Deliverables (at each major phase of project)
Milestones (significant events in the project)
Technical requirements
Limits and exclusions (who, what, how)
Review with customer (agreement on expectations)
Example of project scope statement
Part 4 - Project Planning

6. Identifying Necessary Activities
Start by identifying major-level activities or tasks
Then each major task can be broken down into subtasks
Project team members can be responsible for breaking down different major activities
Then each subtask is broken down to lower-level tasks, and so on until you have basic work-unit levels (work packages) that will be assigned
Result: Work Breakdown Structure (WBS)
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7. Part 4 - Project Planning
Mind Maps
Mind maps are a tool to help identify all the necessary activities in a project
It’s a type of brainstorming tool
The mind mapping process can bring out more ideas than simply making a list
It engages the team and generates enthusiasm
It brings out quieter team members
Mind mapping can be fast, compared to an outlining or listing approach
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8. Mind Map for Project Planning
10K run to
raise $50K
for homeless
shelter
Transportation
Promotion
Prizes/recognition
Facilities
Safety
Refreshments
Clean-up
Route
Registration
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9. Part 4 - Project Planning
Mind Map for WBS
Promotion
Investigate
past events
Interview
running
club
members
Print
Design
To schools
To sports
retailers
Prepare
mailing
Acquire
address
lists
Mail
promo
Monitor
airings
Purchase
air time
Produce
ads
TV and
radio ads
Mailings
Flyers
Research
Distribute
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10. Work Breakdown Structure
Either shown graphically in a tree structure, or as index numbers listed beside activities
Entire project is Level 0; the major-level activities are Level 1; and so on
Index numbers identify level of the task in the tree structure
WBS # indicates that the task is at Level 3 (3 decimal places) and is the 5th sub-subtask under the 2nd subtask under the 4th major activity
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11. Part 4 - Project Planning
WBS Tree Structure
Carnival
Beth
Games
Tom
Promotion
Volunteers
Joan
Rides
Kyle
Entertain.
Jill
Food
Bob
Newspaper
Posters
Tickets
Mark
Grandstand
Performers
Sound
Ben
Stage
Alan
Seating
Level 1 2 3
5.1.2 4 5 6
2.1
2.2
2.3
5.1
5.2
5.1.3
5.1.1
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12. Part 4 - Project Planning
WBS Activity List
WBS Activity
Carnival
1 Volunteers
2 Promotion
Posters
Newspaper
Tickets
3 Games
4 Rides
5 Entertainment
Grandstand
Stage
Sound
Seating
Performers
6 Food
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13. WBS for Promotion Example
Level 1 Task
Level 2 Tasks
Level 3 Tasks
1. Promotion
1.1 Research
Investigate past events
Interview running club members
1.2 TV and radio ads
Produce ads
Purchase air time
Monitor airings
1.3 Mailings
Acquire mailing lists
Prepare mailings
Mail promotional materials
1.4 Flyers
Design flyers
Print
Distribute to schools
Distribute to sports retailers
Part 4 - Project Planning

14. Estimating Activity Durations
Two Approaches
1. Bottom-up estimate: Ask the person responsible for each low-level task how long they think it will take. This assumes a given amount of resources.
2. Top-down estimate: Based on the project due date, tell the person responsible for each low-level task how much time they are allotted to do the task. They must then determine how much resources are needed to meet the deadline.
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15. Estimating Activity Durations
For a given amount of resources, how can you estimate a task duration?
use the expert’s best guess (person doing task)
use past data, if task has been done before
use engineering standards or work standards
dissect task into different elements and estimate time needed for each element
The task time estimate should reflect the most likely time needed to do the task.
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16. Identifying Necessary Resources
To complete a task within a given amount of time, what resources will be required?
How many and what types of employees
What facilities
What equipment
What materials and supplies
What services
What information and technologies
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17. Top-Down vs. Bottom-Up Budgets
Top-Down Budgeting: Senior management decides how much they think the project should cost, and that becomes the total project budget. The budget is then divided among the activities.
Advantages and disadvantages?
Bottom-Up Budgeting: Cost estimates for each task are solicited from those responsible for the tasks. These estimates are rolled up for all activities to get the total project budget.
Part 4 - Project Planning

18. Estimating Activity Costs
Estimates for both time and cost of activities should be done with same approach, either top-down or bottom-up (or somewhere in between)
Two initial budget estimates may be developed for some projects, a top-down and a bottom-up. Which will most likely be higher? Why?
The project manager must then negotiate with senior management to finalize the budget
Tradeoffs may be necessary between the cost, due date, and the extent and quality of outputs
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19. Part 4 - Project Planning
Baseline Plan
The finalized budget, time estimates, and resulting project schedule are the basis for the baseline plan.
The baseline plan lays out the target levels of progress and performance at the outset of the project execution phase.
It is the basis for assessing project performance throughout the project
Project tracking utilizes the baseline plan to provide the project manager with a control tool
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20. Project Planning Exercise
Coffee House Implementation Project
Divide into small groups
Your group has decided to form a partnership and open a new coffee house in an old restaurant building in downtown Fort Worth . The project starts now and ends in 12 weeks when the coffee house opens for business.
Assignment: (40 minutes)
Develop a list of necessary activities (use mind map)
Estimate the duration of each activity
Decide what resources are needed for each activity
Estimate the budget to start the new coffee house
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21. Part 4 - Project Planning
Project Action Plan
For each activity, action plan should at least show
Activity name
Time duration estimate
Start date
Immediate predecessor activity
Resources needed
Optionally, it might also show finish date, WBS index, cost, slack time, latest finish date, etc.
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22. Action Plan in Microsoft ProjectID
Task Name
Duration
Start
Finish
Predec.
Resourc 1
Proj. approval
0 days
3/1/04 2
Script writing
14 days
3/19/04 SW 3
Sched. shoots
17 days
3/24/04
C,P,S 4
Script approval
8 days
3/31/04
C,P 5
Revise script
5 days
4/7/04
P,SW 6
Shooting
10 days
4/21/04
3,5
P,S,SW 7
Editing
7 days
4/30/04
E,ER 8
Final approval
2 days
5/4/04
C,P,E 9
Deliver to client
C=client, E=editor, ER=editing room, P=producer, S=secretary, SW=scriptwriter
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23. Part 4 - Project Planning
Learning Curves
What is the learning phenomenon?
Under what circumstances is worker learning important to consider and plan for?
How does the learning curve phenomenon affect budgeting?
How are task durations estimated when worker learning is relevant?
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24. Task Times With Learning
Time to produce nth unit with 85% learning:
Unit# Time 2 4 8 16
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25. Learning Curve Formula
Time to produce the nth unit, learning rate LR:
Tn = T1(n)r
where
r = (log LR)/(log 2) or r = (ln LR)/(ln 2)
So, the 8th unit with 85% learning & T1=43:
r = (ln 0.85)/(ln 2) =
T8 = T1(n)r = 43(8) =
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26. Part 4 - Project Planning
Learning Curve Tables
Time to produce 8th unit:
T8 = T1*(unit time factor from table)
T8 =
Total time to produce first 8 units:
T1-8 = T1*(total time factor from table)
T1-8 =
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27. Part 4 - Project Planning
Example Situation
A firm has a project to produce 21 units of a new part for a customer.
The firm’s typical learning rate is 85%.
The first unit of the part that was produced (the prototype) required 43 hours to make.
Labor cost is $27 per hour.
Pricing policy is 3 times the total labor cost.
How much should customer be charged?
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28. Part 4 - Project Planning
Learning Curve Tables
How much should firm charge for job?
T1-21 =
What if customer wants 4 additional units?
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29. Part 4 - Project Planning
Learning Curve Tables
T1-25 =
T22-25 = T1-25 – T1-21 =
price for #22-25 or
Do learning curves help justify volume discounts?
Part 4 - Project Planning

30. Project Charter (or Project Master Plan)
Agreed-upon, legally binding project plan (the final plan)
Overview
Objectives
General approach
Contractual aspects
Schedules
Resources and budgets
Personnel
Evaluation methods
Potential problems
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31. Part 4 - Project Planning
Project Charter
Overview
Intended for senior management
Brief description of project & deliverables
List of major milestones
Likely profitability & competitive impacts
Objectives
Purpose of project
More detailed description of deliverables
Could be in the form of a project mission statement
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32. Part 4 - Project Planning
Project Charter
General Approach
Technical and managerial approaches
Relationship with other projects
Contractual Aspects
Description of all agreements (client, others)
Reporting requirements, technical specs, delivery dates, penalties, process for changes
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33. Part 4 - Project Planning
Project Charter
Schedules
Outline of all schedules and milestones
Project action plan, WBS
Resource Requirements
All capital and operating expenses
Cost monitoring and control procedures
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34. Part 4 - Project Planning
Project Charter
Personnel
What types of personnel are needed and when
Skill requirements, necessary training, security clearances, nondisclosure agreements
Evaluation Methods
Descriptions of all procedures and standards for evaluating project—how information will be collected, stored, monitored
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35. Part 4 - Project Planning
Project Charter
Potential Problems
List of potential risks to project progress
Contingency planning may prevent or soften the impacts of some problems
Small or routine projects may not need all 9 of these elements in the project charter, but larger projects should have them.
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36. Part 4 - Project Planning
Responsibility Chart
Often called Linear Responsibility Chart or Responsibility Matrix
Shows who has primary responsibility for each task
Can also show who provides support, who must be notified upon completion, who must give final approval, who is the backup person, etc.
It lets everyone see their roles throughout the project
Part 4 - Project Planning

37. Responsibility Chart WBS Activity Beth Joan Bob Mark Tom Kyle Jill
Alan
Ben
Carnival P S 1
Volunteers 2
Promotion
2.1
Posters
2.2
Newspaper
2.3
Tickets 3
Games 4
Rides 5
Entertainment
5.1
Grandstand
5.1.1
Stage
5.1.2
Sound
5.1.3
Seating
5.2
Performers 6
Food
P = Primary responsibility; S = Support responsibility
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38. Part 4 - Project Planning
Interface Map
Shows who each person or department must interface with and why
Shows participants how they fit in with other parts of the project
Facilitates coordination
Allows for early identification of potentially troublesome interfaces (personality clashes)
New interface maps can be developed for different phases of the project
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39. Part 4 - Project Planning
Interface Map
Adapted from: Bailetti, Callahan, and Di-Pietro, Nov. 1994, IEEE Transactions on Engineering Management
Program
manager
Project
Chip
Manufacturing
Process
technology
Cell library
group
Design
team
Layout
specialist
schedule
Technical
overview
Test
vectors
file
Cell
library
specification
design
High level
Schematic
Netlist
Verification
plan
Simulation
prelayout
postlayout
Review
Use
Create
contribute
Part 4 - Project Planning