Modul PMF - Project Planning

MODULE

3

Project Planning

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MODULE 3

Project Planning

Risk Management Plan

© Prosys Solutions Int’l

Project Management Plan

Cost Management Plan

Project Charter

Requirements Management Plan

A description of the PM approach or strategy Work Breakdown Structure (WBS) Cost estimates, Schedule, Responsibility

Schedule Management Management Plan

Assignments (each task if necessary) Performance measurement baseline (scope,

Scope Management Plan

schedule, cost)

Staffing Management Plan

Major milestone Key staff

Quality Managemen M anagementt Plan

Risk Response Plan

Procurement

Change

Configuration Management Plan Communication

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Project Planning


Project Project Scope Scope & Product Scope •

•

Remember that project scope ≠ product scope Project scope –

–

–

•

Work performed Work per formed to deliver the product, service, ser vice, or result with the specified features and/or functions May include product scope Measured against Project Management Plan

Product scope –

–

Features Features and functions characterizing the product, service, ser vice, or result Measured against product requirements

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Project Planning


Planning Scope Management •

Scope Management Plan includes processes for: –

–

–

–

–

Preparing a detailed project scope statement Enabling the creation of WBS from the detailed project scope statement Establishing how the WBS will be maintained and approved Specifying how formal acceptance of the completed project deliverables will be obtained Controlling how requests for changes to detailed project scope statement will be processed

•

Requirements Management Plan –

–

–

– –

–

Component of the project management plan that describes how requirements will be analyzed, documented, and managed How requirements activities will be planned, tracked, reported Configuration management activities Requirements prioritisation process Product metrics that will be used and the rationale for using them Traceability structure to reflect which requirement attributes will be captured on the traceability matrix

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Project Planning


Scope Definition Results in Scope Statement, which contains many details concerning project and product deliverables, as one of many basis used to keep the project on track Don’t forget to Identify the service coverage for:  Preparation & Resource Mobilization  Technical Solution & Infrastructure  Management of Change  Communication & Socialization  Start-up System and Commissioning  Project Hand-over

Product scope description

Description “What should be done?” Key Deliverable of the project.

Project assumptions

Function: as a Documented basis in making project decisions

Scope Statement

Acceptance criteria Project deliverables Project exclusions Project constraints

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Project Planning


Work Breakdown Structure (WBS) Creating WBS involves subdividing project deliverables and project work into smaller, more manageable components. WBS provides a structured vision of what has to be delivered “deliverable-oriented hierarchical decomposition of the total scope of work to be carried out by project team to accomplish project objectives and create required deliverables” Work not included in WBS is not within project scope

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Project Planning


Scope Baseline The approved version of scope statement, WBS, and its associated WBS dictionary, that can be changed only through formal change control procedures and is used as a basis for comparison  original plan + approved changes  Project

Scope Statement

 WBS  WBS dictionary (document

providing detailed deliverable, activity, & scheduling information about each WBS component)

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Project Planning


Work Breakdown Structure (WBS) Decomposition

Division & subdivision of project scope & project deliverables into smaller, more manageable components until the work and deliverables are defined to the work package level

WBS Level 1 WBS Level 2 WBS Level 3

WBS Level 2

WBS Level 3 Work Package Work Package Work Package

WBS Level 2 Work Package is the lowest level in the WBS, and is the point at which the cost and schedule for the work can be reliably estimated.

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Project Planning


Planning Project Schedule •

Define tasks and activities to be carried out by each phase

•

Define the milestones & deliverables; sequencing the activities and tasks

•

Estimate duration of activities, tasks and phases

•

Refine the plan

•

Create schedule

•

Refine/Tune Schedule

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Project Planning


Defining activities: identifying and documenting specific actions to be performed to produce project deliverables Scope definition vs. Activity definition Activity definition: decomposition up to activity level Scope definition: decomposition up to deliverables level •

•

Rolling Wave Planning: iterative planning technique in which the work to be accomplished in the near term is planned in detail, while future work is planned at a higher level of the WBS  As more is known about the upcoming events, work packages can be decomposed into more detailed

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Project Planning


Activity sequencing Activity sequencing: Identifying and documenting relationships among the project activities  May use diagrams, such as PDM and ADM PDM

ADM

Mostly represented by Activity-on-Node (AoN)

Represented by Activity-on-Arrow (AoA)

4 relationships:  Finish to start  Start to finish  Start to start  Finish to finish

1 relationship: Finish to start

Does not use dummy

May use dummy activity (does not require work or time) to show task dependencies

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Project Planning

Network Diagram ES


Precedence Diagramming Method (PDM)

EF

ES

EF

Activity Name 1

Activity Name 2

Duration (D)

Duration (D)

LS Example

LF

LS

LF

ES : Earliest Start EF : Earliest Finish

LS : Latest Start LF : Latest Finish

A120 Draft Drawing 20 days

121

A140

Initial Design 10 days

Final Design 10 days

A130 Run Simulation 15 days

Project Planning

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Precedence Diagramming Method (PDM)

Sequence Activities

12 activities, 23 logic diagrams

A

B

C

Begin

H

D

F

I

K

E

G

End

J

L

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Project Planning

Network Diagram

Activity

Node 1

Arrow Diagramming Method (ADM)

Node 2

Duration

Draft drawing

Example A 10

Initial design 10 days


20 days

Node 1

A 50

15 days

No duration

Node 2

A 30

A 20 Simulation

Dummy

A 40

Final design 10 days

A 60

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Project Planning

Network Diagram


Precedence Relationship Types

Finish to Start

Activity A

Start to Start

Activity A

Finish to Finish

Start to Finish

FS

SS

Activity B

Activity B

FF

Activity A Activity B

Activity A

SF

Activity B

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Project Planning

Network Diagram


Leads and Lags

A

Leads

FS – 5 days

Lags

B

A B FS + 5 days

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Project Planning

Sequence Activities


Precedence Calculation

Forward Calculation

Backward Calculation

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Project Planning

Sequence Activities


Critical Path Identification and Float

Activity No.

Duration (Day)

Start (ES)

Finish (EF)

Start (LS)

Finish (LF)

Total FLOAT (TF)

A10

2

1

2

1

2

0

A20

3

3

5

5

7

2

A30

1

6

6

8

8

2

A40

4

3

6

3

6

0

A50

2

7

8

7

8

0

A60

5

9

13

9

13

0

Early

Late

Total FLOAT (TF) = (LS) - (ES) = (LF) - (EF) Total FLOAT = 0

(Critical Path)

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Project Planning

Sequence Activities


Dependency Determination

Mandatory Dependency (Hard Logic) Discretionary Dependency (Soft Logic) External Dependency

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Duration Estimation Techniques

Project Planning


Activity duration estimation: estimating the number of work periods needed to complete individual schedule activities with estimated resources Expert Judgment Analogous Estimating Parametric Estimating

Reserve Analysis Group Decision-Making Techniques Three-Point Estimating

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Project Planning

Develop Schedule Schedule baseline The approved time phased plan (for a project , a work breakdown structure component , a work package, or a schedule activity )

•

•

•

•

Define task list from each work package Estimate the duration for each defined task Do Network Planning to show interdependency among tasks Create project schedule baseline and milestones


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Project Planning


Tuning Schedule Fast – Tracking •

•

Schedule Compression

•

Compressing Project Schedule (phases normally done in sequence  performed in parallel , at least partially) Higher probability of rework Usually increases risk

Crashing • •

Usually increases cost Taking action to decrease project duration Increase productivity Move resources from non-critical tasks or adding resources Work overtime Reduce the scope of work (if possible) Subcontracting part of the work

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Project Planning


Workgroup Session: Project scheduling

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Project Planning


Cost Estimation •

•

•

•

Developing an approximation of the cost of resources needed to complete project activities Identifying and considering various costing alternatives Also considering cost tradeoffs & risks, such as: o Make or buy o Buy or lease o Resource sharing to achieve optimal costs for project Cost Risk: who has the cost risk in a type of contract (buyer or seller) – described in risk management

Cost Estimating is different with Pricing (when project is performed under contract)

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Project Planning


Project Cost Direct Cost Direct Material Direct Labor Cost

Indirect Cost Supervisory Cost Construction Equipment/Tools

Overhead Cost Fringe benefits Office and its facilities

Variable Cost Cost that changes with the amount of work Cost of material, supplies, wages

Fixed Cost Cost that does not change as production changes

Sunk Cost Cost that has been invested into or expended upon the project

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Project Planning


Cost Estimating Techniques Analogous estimating Using the actual cost of previous, similar projects as the cost estimation basis. Parametric estimating Using a statistical relationship between historical data and other variables (e.g. square footage in construction, lines of code in software development, required labor hours) Bottom-up estimating Estimating the cost of individual work packages then summarized or “rolled up” to higher levels Three-point estimating Considering estimation uncertainty & risk, using three estimates to define approximate activity cost range

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Project Planning


Cost Budgeting Allocating overall cost estimates to individual activities or work packages to establish cost baseline for measuring project performance Some questions to ask: Is it expensive ? Is it a high volume item ? Is it complex or difficult to construct? Is there duplication ? Is there spare capacity ? Does it require special skills ? High maintenance & operation costs? Does it use obsolete materials ? Is the design “rushed” ? •

•

•

•

•

•

•

•

•

Project budget includes all funds authorized to execute the project Cost baseline == approved time-phased project budget, excluding management reserves

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Project Planning


Cash Flow, Cost Baseline and Funding Display Funding requirements

s t s o C e v i t a l u m u C

Cost baseline Expenditures

The difference between the maximum funding and the end of the cost baseline is Management Reserve

Time

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Project Planning


Workgroup Session: Develop Project Schedule & Cost Estimation

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Project Planning

Project Quality Management

Quality Management Plan Quality Assurance Quality Control

Customer satisfaction

Quality Management Concerns

Prevention over Inspection Continuous improvement Management responsibility Cost of Quality (CoQ)


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Project Planning


Quality Grade “The degree to which a set of inherent characteristic fulfill requirements” (ISO 9000)  Delivered performance/result

“Category assigned to deliverables having the same functional use but different technical characteristics”  Design intent

LOW QUALITY is a problem LOW GRADE is not necessarily problem

MODULE 3 •

•

•

•

Project Planning

Describing how the organisation’s quality policies will be implemented, and how project management team plans to meet the quality requirements set for the project Project quality system: organizational structure, responsibilities, procedures, process, and resources needed to implement quality management Quality management plan must address QC, QA, and quality improvement for the project May contain:  Deliverables & milestones  Quality requirements  Standards for monitoring & controlling  Process review  Major check points  Inspections & acceptance criteria


Quality Management Plan

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CoQ refers to total cost of conformance work and nonconformance work that should be done as a compensatory effort –

•

Project Planning

May be incurred throughout the deliverable’s life-cycle

Post-project CoQ may be incurred because of – – – –

Product return Warranty claim Product recall Errata Cost of conformance

Money spent during project to avoid failures

Cost of nonconformance

Money spent during & after project because of failures

Prevention costs (build a quality product) Internal failure costs (found by project) training, document processes, rework, scrap, repair equipment, time to do it right External failure costs (failures found by Appraisal costs (assess the quality) customer)  testing, destructive testing loss,  liabilities, warranty work, business loss, inspections, quality audits legal issues

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Project Planning


Project Human Resource Management “the processes that organize and manage the project team”. Project Team: “is comprised of the people who have assigned roles and responsibilities for completing the project”.

Project Management Team “is a subset of the project team and is responsible for project management activities such as planning, controlling, and closing”.

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Project Planning


Form of Project Organization Organization chart & position description forms: Hierarchical type charts  Graphical, top-down format Matrix-based charts  e.g.: Responsibility Assignment Matrix Text-oriented formats  e.g.: Position description document, role-responsibility-authority form

Project Organization Charts: Functional Organization Projectized Organization Weak Matrix Organization Balanced Matrix Organization Strong Matrix Organization Composite Matrix Organization

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Project Planning


Functional Organization Project Coordination FUNCTIONAL MANAGER

Chief Executive FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff engaged in project activities on part time basis under coordination

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Project Planning


Projectized Organization Chief Executive PROJECT MANAGER

PROJECT MANAGER

PROJECT MANAGER

PROJECT MANAGER

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Project Coordination

Staff

Staff engaged in project activities On full time basis under full direction of project mgr.

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Project Planning


Weak Matrix Organization Chief Executive FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff engaged in project activities On part time under stronger influence by Functional manager


Project Planning

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Balanced Matrix Organization Chief Executive FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Staff

Project Manager

Staff

FUNCTIONAL MANAGER

Staff engaged in project activities sharing time and effort on equal basis


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Project Planning


Strong Matrix Organization Chief Executive Manager of Project Managers

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

Project Manager

Staff

Staff

Staff

Project Manager

Staff

Staff

Staff

Project Manager

Staff

Staff

Staff

Staff

Staff engaged in project activities With 60-90% time effort under coordination Of designated project manager


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Project Planning


Composite Matrix Organization Chief Executive Manager Of Project Managers

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

FUNCTIONAL MANAGER

Project Manager

Staff

Staff

Staff

Project Manager

Staff

Staff

Staff

Project Manager

Staff

Staff

Staff

Project A Coordination

Staff

Staff engaged in project activities with help of additional staff assigned & control by functional mgr.

Project B Coordination

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Project Planning


Responsibility Assignment Matrix

Responsible

Accountable

Inform

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Project Planning


Key Factors of Determining Project Organization Form Functional

Weak Matrix

Composite Matrix

PROJECT

Uncertainty

LOW

MODERATE

HIGH

HIGH

Technology

STANDARD

STANDARD

COMPLEX

NEW

Complexity

LOW

LOW

MEDIUM

HIGH

Duration

SHORT

MEDIUM

MEDIUM

LONG

Size

SMALL

SMALL

MEDIUM

LARGE

LOW

MODERATE

MODERATE

HIGH

DIVERSE

DIVERSE

3 OR 4

ONE

Interdependency (Within)

LOW

MEDIUM

MEDIUM

HIGH

Interdependency (Between)

HIGH

MEDIUM

MEDIUM

LOW

Time Criticality

LOW

MODERATE

MODERATE

HIGH

Project Characteristic

Importance Customer

Adapted from: Robert Youker.”Organizational Alternatives For Project Management”, Project Management Quarterly, Drexel Hill, Pa.8(1), March 1977, p.21.

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Project Planning


Workgroup Session: Develop Responsibility Assignment Matrix (RAM)

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Project Planning


Provides guidance on how project human resources should be defined, staffed, managed, controlled, and eventually released Roles and responsibilities Role Authority Responsibility competency •

Human Resource Plan

• • •

Project organization charts Staffing management plan Staff acquisition Resource calendars Staff release plan Training needs Recognition and rewards Compliance Safety • • • • • • •

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Project Planning

Project Organization Sample for Complex Project


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Project Planning


Project Communication Management

Stakeholder analysis

Setup project file

Define documentation standards

Choose project management tools

Define monitoring and reporting metrics

Define reporting & meeting procedures

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Project Planning


Communication Management Plan • • • •

• • • • • •

•

• •

•

Stakeholder communication requirements Information to be communicated Reason for information distribution Time frame & frequency for the distribution of required information & receipt of acknowledgment or response Person responsible for communicating the information Person responsible for authorising confidential information release Information receiver Methods/technologies used to convey the information Allocated resources for communication activities Escalation process identifying time frames & management chain for escalation of issues that cannot be resolved at lower staff level Method for updating & refining communications management plan as the project progresses & develops Glossary of common terminology Flow charts of project information flow, workflows with possible sequence of authorisation, report list, meeting plans, etc Communication constraints (usually derived from specific legislation or regulation, technology, organisational policies, etc)

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Project Planning


The Plan..

• •

•

.. documents how you will manage and control communications Since communications are complex, the communications management plan should be in writing in order to be understood by all project team members and stakeholders. As with other management plans, the communications management plan becomes part of the project management plan

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Project Planning


Stakeholder Management Planning •

Stakeholder management planning will identify how the project will affect stakeholders, allowing: –

–

–

•

Development of various ways to effectively engage stakeholders Manage stakeholders’ expectations Ultimately achieve project objectives

Stakeholder management –

–

Create & maintain relationships between and among project team & stakeholders Aims to satisfy the needs & requirements within project boundaries

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Project Planning


Desired & current engagement levels of key stakeholders Scope & impact of change to stakeholders Identified interrelationships & potential overlap between stakeholders Stakeholder communication requirements for current project phase Information to be distributed to stakeholders, including language, format, content, and level of detail Reason for the distribution of that information & the expected impact to stakeholder engagement Time frame & frequency for the distribution of required information to stakeholders Method for updating & refining stakeholder management plan

Stakeholder Management Plan

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Project Planning


Workgroup Session: RAM, Communication planning, Stakeholder management

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Project Planning


Project Risk An uncertain event or condition that, if it occurs, has a positive or negative effect on a project’s objectives Impact to:

Scope Quality Cost Schedule

Uncertainty: •

Known (Open)

•

Known – Unknown (Blind or Hidden)

•

Unknown – Unknown

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Project Planning




Methodology Roles & Responsibilities Budgeting Timing

Describes how risk management will be structured and performed on the project.

Risk Categories Definitions of risk probability & impact Probability & impact matrix

It becomes the subset of Project Management Plan.

Revised stakeholders’ tolerances Reporting formats Tracking

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Project Planning


Risk Register Document in which the results of risk analysis & risk response planning are recorded List of Identified Risks  Risk event  Cause/root cause  Effect Assigned risk owners List of Potential Responses Control actions Risk symptoms & warning signs Residual & secondary risks Risk watch list Contingency reserves

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Project Planning


Risk Analysis: Qualitative Assess the impact and likelihood of identified risk (subjective) Activities: Determine which risk events warrant a response Determine the probability and impact Determine which risk to analyze more fully in risk quantification or to skip risk quantification in favor to going directly to risk response planning Document non critical or non top risk Determine the overall risk ranking for the project •

• •

• •

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Project Planning


Risk Analysis: Qualitative Risk Event Status = Risk Probability x Risk Impact Risk Event Status precisely what might happen to the detriment of the project

Risk Probability how likely the event is to occur

Risk Impact the severity of the consequences

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Project Planning


Risk Analysis: Quantitative Numeric analysis of probability probability of each risk and impact on the project Include: Determine which risk events warrant a response Determine overall project risks Determine quantified probabili probability ty Determine cost and schedule reserves reser ves Identify risks requiring the most attention Create realistic and achievable cost, schedule or scope targets •

• • • • •

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Project Planning


Risk Rankings Evaluating Impact of a Risk on Major Project Objectives Impact

Time

Cost

Scope

1 Insignificant schedule slippage

2 Delivery plan milestone delay within quarter

4

8

16

Delivery plan Delivery plan Delivery plan milestone milestone milestone delay delay of delay\outside of one quarter more than one fiscal year quarter

Insignificant cost increase

<5% cost increase

5–10% cost increase

10–20% cost increase

>20% cost increase

Scope decrease is barely noticeable

Changes in project limits or features with <5% cost increase

Changes in project limits or features with 5–10% cost increase

Sponsor does not agree that scope meets the purpose and need

Scope does not meet purpose and need

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Project Planning


Risk Rankings Time, Cost, Cost, and Scope Objectives

Large Aversion Aversion to High & Very High Impacts Translate Score to Risk Rank

Score

Risk

1–6 7 – 14

Low Moderate

15 – ++

High

Probability

Impact

5

5

10

20

40

80

4

4

8

16

32

64

3

3

6

12

24

48

2

2

4

8

16

32

1

1

2

4

8

16

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Project Planning


Risk Probability Impact Matrix Prob.

Threats

Opportunities

0,90

0,05

0,09

0,18

0,36

0,72

0,72

0,36

0,18

0,09

0,05

0,70

0,04

0,07

0,14

0,28

0,56

0,56

0,28

0,14

0,07

0,04

0,50

0,03

0,05

0,10

0,20

0,40

0,40

0,20

0,10

0,05

0,03

0,30

0,02

0,03

0,06

0,12

0,24

0,24

0,12

0,06

0,03

0,02

0,10

0,01

0,01

0,02

0,04

0,08

0,08

0,04

0,02

0,01

0,01

0,05

0,10

0,20

0,40

0,80

0,80

0,40

0,20

0,10

0,05

Each risk is rated on its probability of occurring and impact on an objective if it does occur. The organization’s thresholds for low, moderate or high risks are shown in the matrix and determine whether t he risk is scored as high, moderate or low for that objective

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Project Planning


Strategies for negative risks or threats Avoid •

Transfer

Eliminate threat or protect the project from its impact

•

Shift threat impact & response ownership to third party

Negative Mitigate •

Reduce risk probability or occurrence or impact

Accept •

Acknowledge & not take action unless the risk occurs

Passive acceptance Document the strategy, leaving the project team to deal with the risks as they occur, periodically review the threat to ensure that it doesn’t significantly change Active acceptance Usually involves establishing contingency reserve to handle the risks

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Project Planning


Strategies for positive risks or opportunities Exploit •

Enhance

Eliminate uncertainty by ensuring the opportunity happens

•

Increase probability and/or the positive impacts

Positive Share •

Allocate some/all ownership to third party to benefit the project

Accept •

Willing to take advantage of the opportunity but not actively pursuing it

Project Planning

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Cause-related Avoid


Risk Response Strategies

Exploit

Outsource-related Transfer

Share

Probability & impact-related Mitigate

Enhance

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Project Planning


Workgroup Session: Risk Analysis

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Project Planning


Procurement Management

Identify potential vendors/contractors

Assess and select shortlist vendors

Identify seller selection planning

Update Project Plan

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Project Planning

Procurement Documents Bid and Quotation Generally used when the source selection decision will be price driven. Proposal Generally used when non financial consideration such as technical skills or approach are paramount Common names of procurement documents IFB : Invitation for Bid RFP: Request for Proposal RFQ: Request for Quotation IFN : Invitation for Negotiation CIR : Contractor Initial Response


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Project Planning


Types of Contract Fixed Price or Lump-Sum •

Fixed Firm Price (FFP)

•

Fixed Price Incentive Fee (FPIF)

Fixed Price with Economic Price Cost Reimbursable Adjustments (FP-EPA) Cost Plus Fee (CPF) or Cost Cost Reimbursable Plus Percentage of Cost Cost Plus(CPPC) Fee (CPF) or Cost Plus or Cost Plus Percentage of Cost (CPPC) or Cost Plus Award Fee (CPAF)Fee (CPAF) Award Cost Plus Fixed Cost Plus Fixed Fee (CPFF) Fee (CPFF) CostPlus PlusIncentive Fee (CPIF) Cost Incentive Fee (CPIF) Time and Material (T&M) •

•

•

•

Modul PMF - Project Planning

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