Chapter 4

Defining the Project

NEED FOR DEFINING PROJECTS

• One Project, small

• Many small projects, or large one– Yes

Steps for a Project

• Step 1 - Defining the Project Scope

• Step 2 -Establishing Project Priorities

• Step 3 -Creating the WBS

• Step 4 –

• Step 5 - Coding the WBS for the Information System

Project Scope Terms and Definitions

• Scope Statements–Also called

–Project Charter–Expanded scope statement–Project manager Authorization

• Project Creep–The tendency for the project scope to expand over time due to

changing requirements, specifications, and priorities.

Step 1: Defining the Project Scope

• Project Scope–End result or mission of the project

• specific, tangible, measurable terms.

• Purpose of the Scope Statement –Define customer deliverables–Project focus

• Planning tool

–Project measurement

Step 1 Defining the Project Scope (cont’d)

See Text book Page 101 Example: Page 104

• Project Scope Checklist1. Project objectives

– What, Where, When, How Much

2. Deliverables– Major Output(s) of the Project

3. Milestones

– Significant events that occur at specific times in the project

4. Technical requirements5. Limits and exclusions6. Reviews with Customer

Step 2Establishing Project Priorities

Step 2: Establishing Project Priorities

• Project Trade-offs• Budget• Schedule• Performance

• Management of Trade-offs• Constrain: fixed requirement• Enhance: optimize over other parameters• Accept:

Step 2Establishing Project Priorities

(Cont’d)

Performance (Scope)

Quality

Cost Time

Step 2Establishing Project Priorities (Cont’d)

• COST minimization

• TIME minimization

• QUALITY assure that product

Performance performs to specifications

Objectives

Step 2Establishing Project Priorities (Cont’d)

• Management of Tradeoff’s– Primary Job of PM– A Tool

• Priority Matrix– Constrain– Enhance

Project Priority Matrix

Constrain

Enhance

Accept

Time Performance Cost

Text Example of a Project – High Speed Modem:

Step 2Establishing Project Priorities (Cont’d)

Work Breakdown Structure

• WBS

• Disciplined

• Structured

• Selective collection of information

Step 3Creating the WBS

• Map of the Project• Divides Project in Smaller Elements

– Element Identity– Project / Organization Integration– Basis for Control– Project Structure

• With Different Levels of Detail– Allows for:

• Planning, scheduling and budgeting• Cost roll-up

Step 3Creating the WBS Cont’d

• WBS Elements– Deliverables (The output, not functions)

• Nouns– Prototype– Mouse– Engine

• If Functional

Hierarchical Breakdown of the WBS

Irwin/McGraw-Hill

1

2

3

4

Project

Deliverable

Subdeliverable

Lowest subdeliverable

Cost account*

Work package

5

Complete project

Major deliverables

Supporting deliverables

Lowest managementresponsibility level

Grouping of work packagesfor monitoring progress andresponsibility

Identifiable work activities

Level Hierarchical breakdown Description

*This breakdown groups work packages by type of work within a deliverable and allows assignment ofresponsibility to an organizational unit. This extra step facilities a system for monitoring project progress(discussed in Chapter 12).

Step 3Creating the WBS Cont’d

WBS / Project Manager• Helps to:

–Facilitate/Plan

–Provide information appropriate to each function

–develop of organization breakdown structure (OBS)• Assigns responsibilities

–Define communication

Work Breakdown Structure

Personal computerprototype

Vendor,software,

applications

Mouse,keyboard,

voice

Diskstorageunits

Microprocessorunit

Moreitems

Floppy HardOptical Internalmemory

unit

BIOS (basicinput/output

system)

ROM RAM I/O File Utilities

Motor Circuitboard

Chassisframe

Read/writehead

~ ~ ~ ~ ~

~ ~

~ ~

Lowest manageablesubdeliverables

Level1

2

3

4

5

Step 3Creating the WBS Cont’d

Step 3Creating the WBS Cont’d

• Work Packages (WP)– Lowest level of the WBS– Short Duration Tasks

• Action Verb – Noun

–Design Prototype

–Build Mouse

–Test Engine

Step 3 - Creating the WBS Cont’d

• Work Package (WP) Continued1. Defines Work

– (What)2. Identifies time to complete a WP

– (How Long)3. Identifies a time-phased budget to complete a WP

– (Cost)

4. Identifies resources needed to complete a WP– (How Much)

5. Identifies a single person responsible for units of work– (Who)

Work Breakdown StructurePersonal computer

prototype

Vendor,software,

applications

Mouse,keyboard,

voice

Diskstorageunits

Microprocessorunit

Moreitems

Floppy HardOptical Internalmemory

unit

BIOS (basicinput/output

system)

ROM RAM I/O File Utilities

Motor Circuitboard

Chassisframe

Read/writehead

WP-1M WP-1 CB WP-1 CF WP-1 RWHWP-2 CB WP-2 CF WP-2 RWHWP-3 CB WP-3 CF WP-3 RWHWP-4 CB WP-4 RWHWP-5 CB WP-5 RWHWP-6 CBWP-7 CB

~ ~ ~ ~ ~

~ ~

~ ~

Work packages

Lowest manageablesubdeliverables

Level1

2

3

4

5

Step 3 - Creating the WBS Cont’d

Step 3 - Creating the WBS Cont’d• Work Package (WP) Continued

– WP manager responsible for • WP schedule

– Should not exceed 10 days (on average)» If it Does:» Monitor Points every three to five days

• WP budget• WP performance (Quality)

– Several WP’s rolled together can constitute sub-deliverable

• From Different functional areas– Can organize WP’s for function, but must be deliverable oriented WBS

Example Work Package

Step 4 Integrating the WBS with the organization

• Defines responsibility– OBS

• Lowest org. unit for responsibility of WP’s within cost accounts

Step 4 Integrating the WBS with the organization

• Intersection of WBS and OBS– Creates a project control point

Step 4 - Integration of WBS and OBS

Time

Cost accountnumber

Personal computerprototype

Vendor,software,

applications

Mouse,keyboard,

voice

Diskstorageunits

Microprocessorunit

Moreitems

Floppy HardOptical Internalmemory

unit

BIOS (basicinput/output

system)

ROM RAM I/O File Utilities

Motor Circuitboard

Chassisframe

Read/writehead

~ ~ ~ ~ ~

~ ~

~ ~

Lowest manageablesubdeliverables

Level1

2

3

4

5

1.0

1.2 1.3 1.1 1.4

1.1.1 1.1.2 1.1.31.4.1 1.4.2

1.4.1.1 1.4.1.2 1.4.2.1 1.4.2.2 1.4.2.3

1.1.3.1 1.1.3.2 1.1.3.3 1.1.3.4

Cost 1.1.3.4.1account

Cost Costaccount account

Cost Costaccount account

Costaccount

Costaccount

Work packages WP1.1.3.4.2.1 WP1.1.3.4.2.2 WP1.1.3.4.2.3

Budget byperiod

Production

Design

Test

Purchasing

Software

Manufacturing

Organization

Step 4 - Integration of WBS and

OBS Read/Write Head Design

Cost

Direct Costs Low Average High

Design engineers $ 80 $100 $150Proto engineers 130 150 280Materials 25 25 25Equipment rental 25 25 30

Total direct costs $260 $300 $485

Work package cost estimate

Step 5 Coding the WBS for the

Information System• Used to Define

– levels and elements in the WBS– Organization elements– Work Packages– Budget

– Allow reports to be consolidated at any level in the structure

– Most common system –

WBS Coding

Project Roll-up

• Cost Account

–Intersection of

• WBS and

• budgetary control point for work packages (WP).

–Roll-up Capability

Direct Labor Budget Rollup

(000)

FIGURE 4.7