Contents
1.0 Introduction22.0 Key Tools for Project Managers32.1 Work
Breakdown Structure, CPA, Grantt Chart32.2 Earned Value
Management92.3 Evaluation of plans for project and key process of
PRINCE 2162.3.1 Evaluation of Plans for Project162.3.2 Seven Key
Processes of PRINCE 2173.0 Summary204.0 References225.0
Appendixes23
1.0 Introduction
The topic that will be discussed in this report is the second
topic in the syllabus of operation and project management which is
Key Tools for Project Manager. As already discussed in topic 1,
project is something that is unique and has a beginning and ending
time which means there are time constraint for every project.
Besides that, project is also a special event which it will not
exactly same as another project and not repetitive. Thus, it is
very important for every project manager to properly manage the
project no matter at which phase.In this report, we will disclose
what tools that can be used in order to help the project manager to
run the project more smoothly, forecasting the future of the
project (since project will meet uncertainty) and also identify the
quality of the project outcome whether it is desirable outcome or
not.Those tools that useful for manager including (i) grant chart,
which can help manager to property state the time phase for every
task that have to be done in the project, (ii) Critical Path
Analysis (CPA), which is very important for the project manager to
identify which task in the project get the priority or is the most
important that cannot be delayed if not will drags the whole
project, (iii) Work Breakdown Structure (WBS), which clearly
identify all the task that have to be done in the project and
together with Organization Breakdown Structure (OBS) to assign the
authority of each task to the person who will be responsible
to.Besides these tools, Earned Value Management system is also a
very important system that can help the project manager throughout
the whole project. The 32 guidelines that breakdown into 5 section
are very important for the project manager to follow in working on
a project. Earned Value Management also provides many benefits to
the project manager to evaluate the project.
2.0 Key Tools for Project Managers
Deconstruction of a projectA project scope is everything about a
projectwork content as well as expected outcomes. Project scope
consists of naming all activities to be performed, the resources
consumed, and the end products that result, including quality
standards. Scope includes a projects goals, constraints, and
limitation. Scope management is the function of controlling a
project in terms of its goals and objectives through the processes
of conceptual development, full definition, execution, and
termination. Scope statement is the heart of scope management which
reflects a project teams best efforts at creating the documentation
and approval of all important project parameter prior to proceeding
to the development phase. There are 4 key steps in the scope
statement process which is: 1. Establishing the project goal
criteria.2. Developing the management plan for the project.3.
Establishing a Work Breakdown Structure (WBS).4. Creating a scope
baseline2.1 Work Breakdown Structure, CPA, Grantt Chart
Work Breakdown Structure WBS is a deliverable-oriented grouping
of project elements which organizes and defines the total scope of
the project. Each descending level represents an increasingly
detailed definition of a project component. Project components may
be products or services. (PMBoK) Used as most basic approach for
the medium-to-large project Known as chunking or unbundling Role:
to create a linked, hierarchical series of activities, which is
independent unit, but at the same time still part of the whole WBS
delineates the individual building blocks that will construct the
project. Visualize the WBS by imagining it as a method for breaking
a project up into bite-sized pieces, each representing a step
necessary to complete the overall project plan.
Purposes of the Work Breakdown Structure1. It echoes project
objectives2. It is the organization chart for the project3. It
creates the logic for tracking costs, schedule, and performance
specifications for each elements in the project4. It may be used to
communicate project status5. It may be used to improve overall
project communication6. It demonstrates how the project will be
controlled
Partial Work Breakdown Structure
The logic across all identified tasks that need to be
accomplished for the project is similar. Work packages is WBS
elements of the project that are isolated for assignment to work
centers for accomplishment.
Level WBS TermDescription
Level 1 (highest)ProjectThe overall project under
development
Level 2 DeliverableThe major project components
Level 3SubdeliverableSupporting deliverables
Level 4 (lowest)Work PackageIndividual project activities
Critical Path Analysis (CPA)Constructing a time plan Having the
estimates of times and resources required is one part of compiling
the plans. In modelling time, this need to be built into models of
the likely project system that will enable key variable such as
project duration and then the schedule established. Most commonly
used technique activity-on-node
Activity-on-node diagrams and critical path analysis (CPA) Use
A-o-N, the construction plan combines the WBS to identify all the
constituent activities, the sequences in which they need to be
performed, ant the estimated duration for each activity. The visual
clarity of denoting activities as boxes and linking them together
is appealing. However, for any two activities, A then B, there are
4 ways in which they can link :
Logical Activity Linkage
The arrows represent a potential time lag in the logic.Analysing
the network Critical Path Analysis (CPA) earliest start time (EST)
determined by the activities preceding the event and is the
earliest time at which the activity on this node can start; latest
start time (LST) is the same or later than the EST and is the
latest time at which all the previous activities need to have been
completed to prevent the whole project being held up; total oat the
difference between the LST and the EST. Critical path the longest
sequence of dependent activities that need to be completed in order
for the project as a whole to finish Forward pass first stage of
the analysis Reverse pass the subsequent calculation to determine
the critical path
Activity notation
Activity network and the critical path
Scheduling Provide the answers of when will activities need to
be carried out? Process that converts the plan into a specific set
of dates for individual activities to be started and finished
Schedule development processReferring to the figure; The arrows
for the inputs of the scheduling process are two ways. The network
provides the logic for the order in which activities need to be
carried out When completed, input of time estimates may show that
the time requires for completion is longer than is available
Network and time estimated will be reconsider Resources capability
set of task that the resources available to the project manager can
reasonably undertake Resources pool resources available in
resources capability Resource capacity depends on the volume of
resources available and issues such as the resources calendarGantt
Charts Time-scaled graphical planning tool, which gives a static
representation of the relationship between activities and their
duration. Purposes to illustrate the relationship between the
activities and time To move from WBS to Gantt Chart, A level of
logic established Conventions used (time left to right, activities
top to bottom) Two critical activities in Gantt Chart : Forward
schedule started the activities at a given date and followed them
forwards in time to determine the end date Backward schedule looked
at the time by which the project needed to be completed and worked
the logic of activities backwards If any insufficient time,
activities have been shortened. Any excess time (slack) is used to
lengthen activities. Benefits; Simple to draw and read Good for
static environments Useful for providing overview of the project
activities Very widely used The basis of the graphical interface
for most project software Limitations; Difficult to update manually
where there are many changes charts can quickly become obsolete and
therefore discredited. Does not equate time with cost Does not help
in optimizing resources allocation Can lead to false sense of
certainty about the project
2.2 Earned Value ManagementWhat is earned value? It is something
that gained through some effort and in project management, this
value earned when the activities completed. Besides that, earned
value also is a measure of progression. The reason to use Earned
Value in project management:(i) It provides a uniform unit of
measure for total project progress or any sub-part of a projectFor
example: the working hours and dollars which are also the
traditional units used. Both will be used in a different type of
situation depends on whether the project is labor intensive or not.
If labor intensive, working hours is adequate while for project
that controlled by the project control system then using dollars as
the unit measure will be adequate.(ii) It is a consistent method in
order to analyze the project performance and progressionUsing
Earned Value to establish a specific method to determine what is
the plan to date and what the progress that actually achieved.(iii)
It is a basis for analysis of cost performance of a projectEarned
Value provides information in order to compare the planned cost of
the completed work and also the actual cost of a project and
helping manager to analyze the cost performance of the
project.Earned Value Management (EVM) become a basic approach in
program management in 1966 when it was used with other planning and
controlling requirements in the United States Air Force programs.
In that time, EVMs requirement is the Cost/Schedule Planning
Control Specification (C/SPCS). Over times, the concept of EVM and
its requirements basically remain unchanged, but there are many
others concepts had been updates to its titles which includes: (i)
Cost/Schedule Control System Criteria (C/SCSC), Earned value
Systems Criteria (EVMSC), and also the currently updated of 32
guidelines for the Earned Value Management System (EVMS).
Earned Value Management (EVM) is more than just a unique project
management process or technique since the 32 guidelines will define
the requirements that a project management system must
meet.Objective of the EVMS are:1. Relate the time phased budgets to
specific tasks or/and statements of work;2. Provide basis to gain
information about the work progress assessment against the baseline
plan;3. Relate technical, schedule, and cost performance;4. Provide
the proactive management action with timely, valid, and auditable
data/information;5. Supply managers with an applicable level of
summarization for effective decision making.Once the EVMS is
designed and implemented on the project, it will benefit the
project manager in term of increasing visibility and control to
quickly and actively respond to the projects issues. In this case,
it will be easier for project manager to meet project cost,
schedule, and technical objective. Besides that, it will also
benefit the customer of the project including the customer will
have more confidence in the project managers ability to manage the
project, identify problems in a timely manner, and provide
objective contrast cost and schedule status.New terms in Earned
Value Management where the project managers internal system must
provide:1. Budgeted cost for work scheduled (BCWS), also called the
planned value (PV) It represents the budget of the activities that
are scheduled or planned to be completed. Formula: PV = BAC * % of
planned work One of the three major components in EVMS
2. Budgeted cost for work performed (BCWP) or earned value (EV)
It represents the scheduled or planned cost of the activities that
were completed. Difference between BCWS and BCWP is BCWS represent
the budget for the activities that are scheduled/planned to be
completed but BCWP is the budget for the activities that are
actually completed. Formula : EV = BAC * % of Actual work One of
the three major components in EVMS3. Actual cost of work performed
(ACWP) Represent the actual cost of the activities that were
completed. One of the three major components in EVMS4. Budget at
completion (BAC) Sum of all budgets established for work in the
project (total planned value for the project)5. Estimate at
completion (EAC) Represent the accumulated actual cost of work
performed plus the estimated cost to complete the remaining work6.
Cost Variance (CV) Formula: BCWP ACWP If result greater than 0
(favorable-underrun), result less than 0 (unfavorable- overrun)7.
Schedule Variance (SV) Formula: BCWP BCWS If result greater than 0
(favorable- ahead of schedule), result less than 0
(unfavorable-behind schedule)8. Variance at completion (VAC)
Formula: BAC EAC IF result greater than 0 (favorable), result less
than 0 (unfavorable)
As discussed early, Earned Value Management Systems are updated
with the 32 guidelines in the ASNI-748 Standard. These guidelines
can be divided into five sections which are:1. Organization2.
Planning, Scheduling and budgeting3. Accounting Considerations4.
Analysis and Management Reports5. Revisions and Data
MaintenanceOrganizationThis section will focus on organizing the
work in the project using 5 guidelines. The most important among
these 5 guidelines in organization is that a project manager must
establish a work breakdown structure (WBS) that will describe the
tasks that will be performed and their relationship to the end
product that the project is aiming for. Besides that, the
organization breakdown structure (OBS) which identifies the people
who is responsible to the work that has been defined in the WBS
should also prepared by the project manager.From here we can see,
Work Breakdown Structure (WBS) define the tasks that have to
perform to get the desirable end product and the Organization
Breakdown Structure (OBS) will defines who is going to perform the
task. The intersection between WBS and OBS will define a control
accounts which is also a key management control point. The
individual who is responsible for the task in the control account
(scope, schedule and budget) is the control account manager (CAM).
CAM will be responsible for planning, coordination and achievement
of all work within the control account and give a single authority
for all these scope, technical and cost issue for the control
account.
Planning, Scheduling, and BudgetingThis is the second section
which will includes 10 guidelines that cover basic requirements for
planning, scheduling, and establishing the time phased budgets for
each of the tasks. In order to meet the project objectives, an
integrated master schedule will be the projects road map. This
schedule must be loaded with the resources required in order to
determine the budget for the work stated in the schedule. This
resources loaded schedule will become the basis for the monthly
budget (BCWS) for each of the tasks and in order word the whole
project. The time phased budgets will become the performance
measurement baseline (PMB) and the total budget for each task,
control account, or the entire project is defined as the budget at
complete (BAC).As discussed earlier in topic 1, a project involved
some level of uncertainty. A project manager will normally set
aside a part of the total project value as Management Reserve (MR).
MR added with BAC will equals to the total project budgeted value
which also defined as the Contract Budget Base (CBB). All of the
budgets on any projects should be logged in order to have a
successful baseline control. Sometime, there will be tasks in the
project that may be temporarily held in absence and not authorized
to the project manager yet while this cause the manager have not
assign the tasks and budgets to the CAMs such as not yet negotiated
for the additional works, the tasks and budgets can be categorized
in undistributed budget (UB). These kinds of budget assignments,
WBS, and the functional organizational identity of the managers can
be captured in the budget summary matrix.Besides that, another very
important aspect in this section is to determine how BWCP will be
assessed. This will start with classifying the work tasks as one
among these three types: (i) discrete (ii) apportioned effort (iii)
level of effort. From this classification, each task which falls
into discrete types, CAM will select an earned value techniques for
it. It is also important to know that a formal work authorization
to proceed is needed so that the work can begins. This requirement
is an approach used to clearly define work, schedule and budget of
the project before the work commences and actual cost incurred.
Accounting considerationInclude in this section is a very long
standing and straightforward project management set which consists
of 6 guidelines in order to capture the actual cost related to the
project work effort. These actual costs must be consistently
collected with the way the tasks of the project is planned and
budgeted. This section stated the needs to select the appropriate
time to schedule an important project resource, material, and to
accrue performance data correctly. Besides that, it also form a
common sense practice to incurred the cost for the material in the
same month which the BCWP was taken in order to avoid misleading
cost variance (booking lag).Analysis and Management ReportsThere
are 6 guidelines in this section which is very important, as it
requires attention to cost and schedule variances, documenting
cause, impact, and correction action, and also determining a new
estimate at complete (EAC). Calculation of variance is normally
done at the control account level and will provides the ability to
summarize the data though the Work Breakdown Structure or/and the
Organization Breakdown Structure. Thus, when it is needed by CAM or
any others, they can drill down from the control account level into
more detail data in order to identity the causes of the variance,
determine the impact of the variance to the future tasks in the
project, and identify possible correction actions. With the use of
Earned Value Management data analysis, managers can consider their
past performance with their future performance to complete the
project within the approved Estimate at Cost (EAC) and Estimate
Completion Date (ECD). With the combined cost and schedule
performance, estimate and the variance trends can be done and will
help project management to carefully review during each reporting
cycle. This estimate is a valuable validity test to the estimate at
completion.
Revisions and Data MaintenanceThis is the final section and is
containing 5 baseline control guidelines that emphasize disciplined
and timely incorporation of customer directed changes which might
include stop project orders. This is important because lack of
baseline control can ruin a project. Thus, establishing and
maintaining a schedule and budget baseline is important in order to
be able to assess work accomplished for each reporting period.
Besides that, this section is compulsory for proactive, meaningful
EVM when there is a constantly changing baseline.
2.3 Evaluation of plans for project and key process of PRINCE
22.3.1 Evaluation of Plans for ProjectBefore we implement the
project, we need to have an evaluation process to the plans for
project. There are a few elements that we need to evaluate before
the plans for the project to be approved.Firstly, we need to make
sure that the resources that needed to implement the whole project
is affordable by the company and not more than the amount of the
budget that given by the company. It is very crucial because a plan
of project cannot be implemented if there is no enough resources
although the project is very good. The manager may ask for extra
resources. This is because the team of project will be a lot of
comfortable if there are some contingency resources.Furthermore,
the project manager should ensure that the objectives of the
project are aligned with the goals of corporation. This is because
the projects that do not align with the companys goal are hard to
success. Those projects focus on their own personal interest or
focus on their own department. Therefore, those projects will not
get full management support from the company.On the other hand, the
project manager should evaluate the risk of that plans of project
and make sure that the level of risk is in a tolerance range.
Project manager should able to deal with the issues and risk. It is
important to produce a risk log with an action plan for those
expected risks that the project may face. The project manager needs
to make sure that all members of project team are aware of the risk
log. So, the team can quickly resolve the issue with the management
plan that has already been set in place. This will give the team
confidence when facing project risks and help the company feel
comfortable with the projects progression.Last but not least, the
project manager should evaluate the schedule of the activities of
projects. It will be better if there is a Gantt chart which plots
all of those works that the team have worked out and also the
period of time needed. Besides, the project manager should ensure
that the total period of time that needed is in the range of
suggested time for that project. 2.3.2 Seven Key Processes of
PRINCE 2
1. Starting-up a projectThis process is designed to make sure
that all prerequisites are in place in order to make an informed
decision about commencing a project.The time spent in this process
is very short. There are 3 important elements that need to focus.
Firstly, we should ensure that the information required for the
project team is available. Secondly, a project management team
should be formed. Lastly, Initiation Stage Plan and Project Brief
are the key output for this process.2. The Initiating a Project
This process establishes a stable management basis on which to
proceed. This is because the project manager can create a suite of
management products that control, define and plan the scope of the
work that required. Project Board will use the information provided
in initiating process to decide whether want to authorize its
continuation or not. The project will be approved if the objectives
of the project are aligned with corporation. The initiating process
activities that will be performed by the project manager include
preparing the strategies for managing risks, quality and
communications and setting up the projects controls. A Project
Initiation Document (PID) will be produced in this phrase. Project
manager need to ensure that the investment of time and effort
required by the project is made wisely, taking account of the risks
to the project.3. Directing a Project After getting the request
from Starting up a Project, we just can initiate the project. The
project board will exercise overall project control and make
important decision. The project board manages and monitors via
reports and controls through a number of decision points. Project
manager will receive direction and guidance from project board.
Project manager will ensure that every process comes complete with
recommended activities, products and the related responsibilities
for which subordinates.4. Controlling a stage The project manager
is responsible to handle daily management project work. The project
manager has to monitor and review the progress of the work to make
sure that those authorized works had been done by the subordinates
at the expected standard. If there is any unexpected changes
happed, project manager has to take some necessary corrective
action to make sure that those works had been corrected. Besides,
project manager should always deal with the issues and risks. Those
expected events should be recorded in order to prevent other
subordinates repeat the same mistake. A completed work package will
be received in the end of this process. Specialist products for the
management stage are delivered, verified and accepted and the next
stage is planned for and approved for all stages except the last
stage of the project.5. Managing Product Delivery The purpose of
this process is to manage the acceptance, execution and delivery of
project work. Managing product delivery (MP) controls the link
between the Project Manager and the Team Managers and makes sure
that the work products are delivered to expectations and within
tolerance. This process ensures that the team is working on
products that are authorized and obtains the approval for completed
products. These products must be clearly specified, understood and
delivered to expectations and within tolerance. Team Managers
provide the Project Manager with regular progress reports about the
teams work.Teams may be internal or external to the organization.
MP is triggered by receipt of one or more authorized Work Packages
from the Project Manager to the Team Manager. When a work package
is completed, it is handed back to the Project Manager.
6. Managing Stage Boundaries The activities of stage boundaries
happen at or near the end of a stage or when the current stage has
exceeded tolerance and is in exception. The board manager will make
a important decision in this stage to decide that whether this
project want to be continued or not. Besides, the other decisions
such as approving the next stage plan, reviewing and updated
project plan, requesting an exception plan and confirming the
continued business will be made by the board manager with the
sufficient information that provided by project manager. After
assessing the continuing ability of the project, project manager
will record lessons and measurements that can assist later stages
of this project or other projects.1. Closing a ProjectClosing a
project is a process covers the Project Managers work to wrap up
the project either at its end or at premature close. During this
process, the project manager needs to check whether the objectives
and the aims set out in the project initiation document have been
met or not. The input will be prepared to the project board to
obtain the confirmation that the project will be closed. On the
other hand, the project manager should make sure that the outcomes
or deliverable of this project are satisfy and accepted by the
customers.
3.0 SummaryNetwork diagramCritical Path Analysis (CPA)Work
Breakdown Structure (WBS)
15.0Revisions and Data Maintenance
4.0Analysis and Management Reports3.0Accounting
Consideration2.0Planning, Scheduling &
budgeting1.0OrganizationEarned Value management (EVM)Grant
ChartsKey Tools for Project manager
7.0Closing a project
6.0Managing stage boundaries
5.0Managing product delivery
4.0Controlling a stage
1.0Starting up a project
3.0Directing a project
2.0Initiating a project
7 key processes of PRINCE 2-Ensure resources needed is
affordable & not exceed the budget -Ensure objective is same
with the goal-Evaluate the risk & make sure it is in the range
of tolerable level-Evaluate the project activities
ScheduleEvaluation of Plans for Project
1
4.0 References
1. Harvey Maylor (2010). Project Management. Italy: Prentice
Hall
2. Jeffrey K. Pinto (2013). Project Management. Pearson
Education
3. Tammo T. Wilkens (1999). Earned Value, Clear and Simple
4. Kay Wais. How to Implement Earned Value. Retrieved from:
http://www.projectsmart.co.uk/earned-value-management.php
5.0 Appendixes
Figure 1: Work Breakdown StructureFigure 2: Critical Path
Analysis
Figure 3: Earned Value Management
Figure 4: Intersection between WBS & OBS and CA
established19
