MGT Quiz 2

Project management trade offs

Scope, Cost, Time

Limitations of WBS

dependency, sequencing, and timing of each of these factors are not included in the work package. A network activity can include one or more work packages.

Activity

an element in the project that consumes time—for example, work or waiting

Identify and briefly describe the five steps in defining a project

(1) Defining scope; (2) Establishing priorities; (3) Creating WBS; (4) Integrating WBS with organization; (5) Coding the WBS.

Identify and briefly describe the three types of project constraints that could impact or change the structure of project network

(1) Technical (logic)-the sequence that activities must be performed; (2) Resource-the absence of required people, materials, equipment, or working capital; (3) Physical-limitations based on space or environmental limits.

Identify and briefly describe the two major classifications of estimating project time and costs

(1) Top-down estimates are made for the project as a whole and typically made by top management; (2) Bottom-up estimates are made at the work package level and by those responsible for completing the work packages

Failures in work packages and networks are due to

(1) different people are used to define work packages and activities (2) the WBS is poorly constructed and not deliverable/output oriented

Top-Bottom Methods for Estimating Project Times and Costs

- Consensus Method - Ratio Method - Apportion Methods - Function Point Methods - Learning Curves

Bottom-Up Estimates

- Cost and time important -Fixed-price contract - Customer wants details

Why estimates can be off

- Interaction costs hidden in estimates - Normal conditions do not apply - Things go wrong in projects -Changes in project scope and plans - Overly optimistic

Top-Down Estimates

- Strategic decision making - High uncertainty - Internal, small project - Unstable scope

Bottom-Up Methods for Estimating Project Times and Costs

- Template Methods - Parametric Procedures Applied to Specific Tasks -Range Estimating - Phase estimating*

Use lags in order to

1. Break activities into smaller activities to avoid long delays 2. Constrain stat and finish of an activity

Problems in a multiproject environment

1. Overall schedule slippage 2. Inefficient resource utilization 3. Resource bottlenecks

Factors influencing quality estimates

1. Planning horizon; estimates of current events are close to 100 percent accurate but are reduced for more distant events. 2. Project duration; long-duration projects increase the uncertainty in estimates. 3. People; skills of the people making the estimates. Skills of the people working on the project, learning curve. Time spent communicating between team members. 4. Project structure; will influence time and cost estimates. E.g. dedicated project team or matrix. 5. Padding estimates. 6. Organizational culture. 7. Other factors; such as non-project factors.

Estimating Guidelines

1. Responsibility to those most familiar with task 2. Use several people to estimate 3. Based on normal conditions 4. Specify time units 5. Each task is independent of other tasks 6. Work package estimates should not include allowances for contingencies. 7. Add risk level

Each work package in the WBS must answer

1. what is being worked on 2. for how long 3. at what cost 4. how many resources are needed 5. who is responsible 6. how will is it being handled

Cost account

A control point of one or more work packages used to plan, schedule, and control the project. The sum of all the project cost accounts represents the total cost of the project.

Work Breakdown Structure (WBS)

A hierarchical decomposition of the total scope of work to be carried out by the project team to accomplish the project objectives and create the required deliverables.

Process Breakdown Structure (PBS)

A phase-oriented grouping of project activities that defines the total scope of the project. Each descending level represents an increasingly detailed description of project work. (Software development)

Resource-Constrained Project

A project that assumes resources are limited (fixed) and therefore time is variable.

Organization Breakdown Structure (OBS)

A structure used to assign responsibility for work packages.

Resource smoothing

A technique which adjusts the activities of a schedule model such that the requirement for resources on the project do not exceed certain predefined resource limits.

A hammock activity

Activity derives its name because it spans over a segment of a project. Determined after the network plan is drawn. Used to identify the use of fixed resources or costs over a segment of the project.

Merge Activity

An activity that has more than one activity immediately preceding it.

Scope Creep

the tendency for the project scope to expand over time (changing requirements, specifications, and priorities)

Laddering

Completing steps simultaneously. Example of making a trench.

white elephant

Projects that are over budget and under value, and the cost of maintaining them exceeds the benefits received (Olympics)

Resource Smoothing

Delaying noncritical activities to lower peak demand on resources

Resource-constrained scheduling

If resources are not adequate to meet peak demands, the late start of some activities must be delayed, and the duration of the project may be increased.

Time-Constrained Project

Must be completed by an imposed date. Time is fixed, resources are flexible: additional resources are required to ensure project meets schedule.

Parallel Activities

The activities can take place at the same time

Total Slack

The amount of time an activity can be delayed and not delay the project

free slack (free float)

The amount of time an activity can be delayed without delaying the early start of any immediately following activities

How does the WBS differ from the project network? How are WBS and project networks linked?

The network is developed from the information collected from the WBS and is a graphic flow chart of the project job plan. Networks provide the project schedule by identifying dependencies, sequencing, and timing of activities the WBS is not designed to do.

Work Package

The work defined at the lowest level of the WBS for which cost and duration can be estimated and managed.

Project Network

Tool used for planning, scheduling, and monitoring project progress.

Activity on node network (AON)

an approach used to create a network diagram, in which nodes represent activities and arcs represent the precedence relationships between them

Project charter

a document that authorizes the project manager to initiate and lead the project

Activity-on-arrow (AOA)

a network diagram in which arrows designate activities

Path

a sequence of connected, dependent activities

Burst Activity

has more than one activity immediately following it

Mega Projects

large-scale construction projects that require a huge capital investment; the construction of the Beijing Airport. Not only do they cost much more than expected, but they underdelivered on benefits they were to provide

Resources can include

people, materials, equipment,

Hierarchical Breakdown of the WBS

project, deliverable, subdeliverable, lowest subdeliverable, cost account, work package

A project scope should have

the objective, deliverables, milestones, technical requirements, limits and exclusions and reviews with customer

Critical Path

the path(s) with the longest duration through the network

Estimating in project management refers to

the process of forecasting or approximating the time and cost of completing project deliverables

The absence or shortage of resources can alter technical constraints, but

the resource dependency takes priority over the technological dependency but does not violate the technological dependency

Overview of project networks

• a visual flow diagram of the sequence, interrelationships, and dependencies of all the activities that must be accomplished to complete the project • Work packages from the WBS are used to build the activities found in the project network. • An activity can include one or more work packages. • The activities are placed in a sequence that provides for orderly completion of the project. Networks are built using nodes (boxes) and arrows (lines)

Project Communication Plans

∙ What information needs to be collected and when? ∙ Who will receive the information? ∙ What methods will be used to gather and store information? ∙ What are the limits, if any, on who has access to certain kinds of information? ∙ When will the information be communicated? ∙ How will it be communicated?