Plan Projects - Baseline Project Scope, Schedule and Budget

Welcome to the This Session – Baseline your Project “On becoming Real World Project Management Professional” : Welcome to the This Session – Baseline your Project “On becoming Real World Project Management Professional” Syed Naqvi, PMP ssanaqvi@gmail.com

Course Objective : Course Objective After going through this course participants will develop : An Understanding of basic project management concepts, environment and activities Develop knowledge and Skill set required for project management and and ability to apply them in managing Projects on Time, In Budget with Quality Necessary knowledge to pass PMP exam for certified PMP credential

Course Coverage : Course Coverage Project Management Framework Introduction to PMI, USA and PMP Exam PMI Process Groups PMI Knowledge Areas Professional and Social Responsibilities

Session3 - Objective : Session3 - Objective Recap of the Previous Session Plan Project and baseline Scope Schedule Budget Quality

Definition of Project and Project Management : Definition of Project and Project Management A Project is a SMART , Collaborative & Cross Functional Undertaking Having Temporary Organization & Project Management is the art and science of Managing Competing Constraints (Scope, Schedule, Cost, Quality, Resource) and Risks associated with the project with suitable trade off , to ensure that project goals are met In an environment which is increasingly becoming Global & Flat (Multi-time zone, Multi-regulation, Multi-culture and multi-location virtual team) S: Specific – Scope, Time, Cost Resource, Quality) M: Measureable, A: Attainable, R: Risk, T: Time bond In project number of people with cross functional, culture, location back ground work together towards a common goal

Project Triple Constraints Scope, Schedule and Cost and art of Trade off : Project Triple Constraints Scope, Schedule and Cost and art of Trade off Cost Schedule Scope If, Cost is fixed , Schedule is decided, then Scope need to be adjusted If, Scope is fixed, Schedule is decided, then Cost need to be adjusted Cost Scope Schedule Triple Trade Off Example Quality

Understanding Project Planning : Understanding Project Planning Project Charter Proj. Quality Requirement Base line Project Plan Proj. Quality Mgt Plan WP Quality Requirement RAM Proj. Human resource Mgt. Plan RACI Chart Proj. Communication Mgt. plan Proj. Communication Record Proj. Procurement Mgt. plan WP Procurement Specification Scope Def Document WBS Baseline Proj. Scope Mgt Plan , WP Def. document Proj. Schedule Baseline Proj. Time Mgt Plan WP Schedule Proj. cost/ Budget Baseline Proj. Cost Mgt Plan WP Budget WP procurements Record Project Feasibility Analysis SH analysis Project Requirements Risk Register Proj. Risk Mgt. Plan Proj. Scope Mgt Plan Proj. Time Mgt Plan

Plan Project – Define Scope : Plan Project – Define Scope Definition Specifying Detailed aka Low level requirements Objective Specify all high level requirements in sufficient detail so that they become basis for all project work Inputs Project Charter, Requirements Documentation, OPA, PEF Tools, techniques and practices Expert Judgment, SME, Product Analysis, Alternatives Identification, Creative technique – Lateral thinking, Parallel thinking , Facilitated Workshop Continuous review and early feedback from all relevant stakeholders/SME Project Constraints Outputs Project Scope Statement – Project Scope Description Scope Exclusion Outcome Scope document should have following properties Fitness for Purpose/Use – In sufficient details so that it can be basis for future project work 5C Quality attributes Best Practices Project Scope should be developed in iterative mode

Plan Project: Task – Create WBS Deliverable and Work package : Plan Project: Task – Create WBS Deliverable and Work package WBS - Work Break Down Structure PBS – Product Work Break Down Structure OBS - Organization Break Down Structure TBS - Task Break Down Structure Scope - WBS – PBS – Deliverables - Work package -- OBS – TBS – Activity – Resource Resource like time, Human resource, Material and equipments can be assigned at any level of WBS A deliverable is a contractual work package Deliverable is contractual, discrete items which require one or more work packages A work package is a logical unit of discrete work which may be independently scheduled, performed, verified and delivered Project monitoring is done at Work package level

Plan Project - Task – Create WBS : Plan Project - Task – Create WBS Definition Decompose Project product or systems into number logical, discrete, hierarchical, Delivery oriented Workpackages Objective Should define all the Work in the project and only the work in the project Work package should be of appropriate granularity – Neither very high nor very low Its should be possible to do Cost estimate, Schedule, Monitor and Assign responsibility of work package to one person or organization unit. Inputs Project requirement document Project scope document OPA, EEF Tools, techniques and practices Decomposition, Partitioning Functional Decomposition, Work Decomposition Each Work package must be is assigned to a control account no. Each Work package is assign to OBS code Each work package is a part of RAM(Responsibility Assignment Matrix) Outputs WBS documents Outcome Each Work package should result in verifiable product, service or result

WBS Example : WBS Example 1.0 Project Design, Manufacturing, Testing, Delivery, E & C Electrical System 1.1System engineering 1.2Transformer 1.3Motors Control Center 1.4Motors 1.5Project Management 1.2.1Transformer 1 1.2.1Transformer 2 1.4.1Motor 1 1.4.2Motor 2 Initiate project Plan Project Execute Project Plan Control Project Close Project 1.4.2.1Write Specification 1.4.2.2Make RFP 1.4.2.3Receive Proposal 1.4.2.4Evaluate Proposal 1.4.2.5Receive drawing 1.4.2.6Approved drawing 1.4.2.7Visit for inspection 1.4.2.8Give Dispatch clearance 1.6Testing 1.7Delivery 1.8E & C

Plan Project: Task – Verify WBS : Plan Project: Task – Verify WBS Definition to formally state that deliverable is meets the acceptance criteria for deliverables Scope, Cost, schedule and quality requirements Objective A formal verification that deliverable meets the criteria for fitness for purpose and other quality attributes Inputs Project Scope statement, WBS, WBS dictionary, Requirement document, Requirement Traceability Matrix, Tools, techniques and practices Inspection, Testing and measurement Outputs Accepted deliverable, Change request Outcome All verified deliverables should meet the criteria of fitness for purpose and other quality attributes

Execute project: Task – Control Scope : Execute project: Task – Control Scope Definition Managing change in Scope Objective All Scope change request should go through scope change control process which should decide whether request should be accepted or rejected All accepted scope change request should be implemented Relevant stakeholders should be intimated regarding acceptance or rejection of scope Inputs Scope Change Request Tools, techniques and practices Scope change impact analysis Cost,Schedule and quality Variance analysis Outputs Approve and disapprove Change request Update in following documents Project Plan Project Scope statement, WBS, WBS dictionary, Requirement document, Requirement Traceability Matrix Outcome Scope change should be managed in controlled manner and scope creep in should be avoided .

Project Time Management : Project Time Management Completing Project on time is one of the biggest challenge in Project Management Project Work should be done not only on time but JIT or Just on Time Neither early nor late Project Schedule is prepared in following steps: Identify Project activities Identify Activity duration Identify Activity sequencing Identify Activity Resource Identify Project Calendar Identify Resource Calendar Identify Project Milestone Enter Activity start and end date Identify Project critical path

Plan Project – Define Activities : Plan Project – Define Activities

Plan Project – Define Activity Duration : Plan Project – Define Activity Duration

Plan – Sequence Activities : Plan – Sequence Activities

Plan Project – Sequence activity : Plan Project – Sequence activity A1 A2 SS A1 A2 FF A1 A2 SF A1 A2 FS Begin A1 A3 A2 A4 FS+5 A5 FS - 2 Dummy activities ? Float and slack ?

Plan Projects – Estimate Activity Duration : Plan Projects – Estimate Activity Duration

Three Point Estimate : Three Point Estimate PE or Pessimistic estimate OE or optimistic estimate LE or most likely estimate RE or realistic estimate RE = (W1*PE+W2*OE+W3*RE)/6 W1, W2, W3 – Weightage W1+W2+W3 = 6

Plan Project – Estimate activity Resource : Plan Project – Estimate activity Resource

Plan Projects – Schedule Project and Activities : Plan Projects – Schedule Project and Activities

Project schedule monitoring and control : Project schedule monitoring and control Publish a schedule so that each stakeholder should have access to his portion of the schedule Each person responsible for schedule, should update the schedule at regular interval There should be a single point of entry for activity status update Schedule status information should come to the project Manager Project Manager should take immediate action if there is a schedule variance

Project Costing : Project Costing Costing is done at different time for different purpose Ball park figure For Budget During marketing stage During project initiation Accuracy level varies at depending upon timing of the costing The real challenge in Costing is to avoid under costing or over costing Cost estimate can be improved with progressive refinement and costing should be periodically reviewed and updated

Project Costing : Project Costing Basic Cost Behavior Fixed Cost Variable Cost Direct and Indirect Cost Activity based costing or Lifecycle cost

Project Costing : Project Costing Categories of Cost At project level Cost of capital, Resource cost, Travel cost Transportation cost(F&I), Hedging cost Site infrastructure cost, Project management cost Spares and warranty cost, Taxes and duties Cost at work package level Cost of the work package depends Specification – what you want Avoid over or under specification Quantity - Work package cost Every Work package has one main cost and more than one additional cost It is important to consider main cost as well as all other possible additional costs Work package life cycle cost Design, Bought out cost, Manufacturing and assembly cost Testing cost, Taxes and duties, Transportation cost, Storage cost, Erection, Commissioning and handing over cost

Project Costing and budgeting : Project Costing and budgeting Cost and Price The actual money required to deliver a work package /complete the project work Pricing is the values at which project/work packages are billed to the customers Costing and budgeting Costing is the actual monies required to complete the project work Budget is an expenditure plan to ensure that monies are available to To meet the work expense requirement over time throughout project lifecycle Project CAPEX and OPREX budget Project Inventories, Receivables and Payables Working Capital Cashflow management

Costing Technique : Costing Technique Analogous Estimate Parametric Estimate Three Point Estimate PE or Pessimistic estimate OE or optimistic estimate LE or most likely estimate RE or realistic estimate RE = (W1*PE+W2*OE+W3*RE)/6 W1, W2, W3 – Weightage W1+W2+W3 = 6

Thank You : Thank You Syed Naqvi, PMP