1. Project Management x470 The Planning Processes UC Berkeley Extension, Business and Management Week 3, 8 May Kimi Hirotsu Ziemski 925.639.4564 kimi@energizingenterprises.com

2. 2 The Cost Baseline

3. 3 Think TEAM 3 Project Cost Management Process Group Process Name Process Major Deliverable/s Initiating Planning Estimate Cost Activity Cost Estimates Budget Cost Cost Baseline Executing Monitoring & Controlling Control Cost Updates to Cost Baseline and other documents Closing

4. 4 Think TEAM 4 Analogous Estimating Use actual cost of a previous similar project to estimate cost of current project Approximate estimate Accuracy +- 15% Parametric Modeling Use project parameter in a mathematical model to predict project costUse project parameter in a mathematical model to predict project cost Accuracy +- 35% within the scope of the projectAccuracy +- 35% within the scope of the project Example: construction cost per square footExample: construction cost per square foot

5. 5 Think TEAM 5 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%

6. 6 Think TEAM 6 Cost Baseline Time-phased budget for measuring, monitoring and controlling overall project cost performance Cumulative Amount Time

7. 7 Think TEAM 7 Life Cycle Costing SYSTEM R&D PRODUCTION SYSTEM ACQUISITION OPERATION AND SUPPORT LIFE CYCLE COST YEARS

8. 8 Think TEAM 8 Costing Exercise From your project WBS, develop –the resource requirements, –cost estimate and –cost baseline (per phase) for your project your project

9. 9 Think TEAM 9 Bank Network Migration Project Deliverables Processes Phases Design Migration Plan Migration Operational Acceptance Project Management Project Charter Preliminary Product Scope Statement ProjectManagementPlan 1.Scope Statement 2.WBS 3.Project Schedule 4.Cost Baseline Product Oriented 1.Network Architecture Document 2.Network Design Document 1.Detailed Network Drawings 2.Service Level Agreements (SLAs), ITIL

10. 10 Best Practices Develop a cost baseline 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

11. 11 Agenda Risk Management Information Distribution Quality Management Selecting Vendor

12. 12 Risk Management Risk: an uncertain event that, if it occurs could impact the project in either a negative or positive fashion Processes: –Plan Risk Management –Identify Risks –Perform Qualitative Risk Analysis –Perform Quantitative Risk Analysis –Plan Risk Responses –Monitor and Control Risks

13. 13 Project Quality Management Based on the definition of project quality: Meeting requirements and fitness of use

14. 14 Quality management processes: Plan Quality Perform Quality Assurance Perform Quality Control

15. 15 Plan Quality Within the budget and time constraints you also have to manage: Stakeholder expectations Product legal requirements Product industry standards Organizational process requirements What other areas might have requirements or expectations that you will have to manage in order to deliver the product desired within the constraints demanded?

16. 16 Perform quality assurance Once you know what quality requirements must be maintained quality assurance is how you determine those methods your team will use to achieve the necessary requirements.

17. 17 Perform Quality Control If, during the process of performing quality assurance you find a significant variance from where you need to be then you must begin employing processes to correct that – to regain control.

18. 18 Project Communication Management Project Communication Management Process Group Process NameProcess Major Deliverable/s Monitoring & Controlling Performance Reporting 1.Performance Reports –Comparison to baseline –Bar chart, S-curves, histograms, tables, traffic light –Earned Value Management 2.Forecasts Manage Stakeholders Resolve issues

19. 19 Project Communication Management Collection and dissemination of performance information to stakeholders with info on how resources are being used to meet project goals – –Status reporting (where project stands vs. baselines) – –Progress reporting (accomplishments) – –Forecasting (prediction of future performance) – –Risks (present and future) assessment – –Special problems / management assistance

20. 20 Project Dashboard ProjectMetricStatusTrend Problem Statement Corrective Action Scope Schedule Cost Overall Health Executive Summary Results Next Steps Working Challenges

21. 21 Sample Metric Status Definition Scope Green No scope change. Yellow Change within 10% of original scope Red Change over 10% of original scope. Need re-baseline. Schedule Green On track for scheduled completion Yellow Within 10% of scheduled completion Red Over 10% scheduled completion. Need re-baseline. Cost Green Completion within budget Yellow Completion within 10% of budget Red Completion over 10% of budget. Need re-baseline.

22. 22 Sample Metric Trend Definition ColorDefinition Green Less than 25% probability that a project risk that impacts a parameter target (scope, time, cost) will occur Yellow 25% to 50% probability that a project risk that impacts a parameter target (scope, time, cost) will occur. Red Greater than 50% probability that a project risk that impacts a parameter target (scope, time, cost) will occur

23. 23 Flexibility Matrix and Status Trigger Trigger point for Schedule color can be tighter ParameterHighMediumLow ScopeYes ScheduleYes CostYes Trigger point for Cost color can be looser

24. 24 Project Reports Proj ID Project Name Project Manager Major Issues Sched Status Tech Status BudgetSavingsStaffing Cust Satis. Sched Comp. Overall DISRUPTED PROJECTS 12 RR YYYYY RR 32 Y G YY GGGG Y TOP INITIATIVES (TI) 8 GGGGGGGGG 18 GGGGGGGGG INFRASTRUCTURE IMPERATIVES 6 GGGGGGGGG 43 GGGGGGGGG

25. 25 Project Procurement Management Process Group Process NameProcess Major Deliverable/sInitiating Planning Plan Purchases and Acquisitions Procurement Management Plan Contract Statement of Work (SOW) Make or Buy Decisions Plan Contracting Procurement documents – Bid, RFP, RFQ Evaluation Criteria Executing Request Seller Response Qualified Sellers List Proposals Select Sellers Selected sellers Contracts Monitoring & Controlling Contract Administration Contract documentation Requested changes Closing Contract Closure Closed contracts

26. 26 Contract Administration Ensuring that the seller’s performance meets the contractual requirements Invoices / payment requests Contract changes Correspondences

27. 27 Bank Network Migration Deliverables Processes Phases Design Migration Plan Migration Operational Acceptance Project Management - Project Charter - Preliminary - Preliminary Project Scope Statement Project Management Plan 1.Scope Statement 2.WBS 3.Project Schedule 4.Cost Baseline 5.RAM 6.Comm. Mgmt Plan 7.Risk Response Plan 8.Vendor Proposals 1.Contracts 2.Status Reports 3.Change Requests and approvals a.Corrective actions b.Updates to management plan 4.Earned Value Reports Product Oriented - Network A rchitecture D ocument - Network DesignDocument 1.Detailed Network Drawings 2.Service Level Agreements (SLAs), ITIL 1.Equip. ordering and delivery 2.MPLS network ordering and delivery 3.Network Roll-out, testing, acceptance 4.Branch, ATM migration