Telecommunications Certificate Program · CSU Project Management Certificate Program. 2 ... •Team...
Transcript of Telecommunications Certificate Program · CSU Project Management Certificate Program. 2 ... •Team...
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Project Time and Cost Management
Instructor: Lee Varra-Nelson
970-407-9744 or 970-215-4949
CSU Project Management
Certificate Program
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Agenda• Objectives / Syllabus
• Time Management Processes
• Project Time Management
• Project Cost Management
• Summary
Project Time & Cost Management
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Time Management Objectives
• Understand basic building blocks of project time management according to PMI and real world.
• Understand the function of the project manager in managing time and schedule on your project.
• Create a Network Diagram from your WBS.
• Know how to calculate critical path.
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Syllabus – Section 3 (four weeks)
Week
1
• Introductions, course objectives
• Where Time mgmt. processes fit into the process groups
• Time Management processes (PMBOK p.125)
• Activity Definition, Sequencing,
• Activity Resource Estimating and team exercises
• Instructor to hand out assessment - open book & return last night
of class
• Read PMBOK Chapter 6, Time
Mgmt.
Week
2
• Activity Duration Estimating
• Schedule Development
• Schedule Control
• Team Exercises
• Read PMBOK Chapter 7 – Cost
Mgmt.
• Complete Time exercise homework
Week
3
• Finish Schedule Development
• Project Cost Management (PMBOK - Chapter 7)
• Cost Estimating (types of estimating)
• Cost Budgeting (Reserve Analysis and Contingency)
• Team Exercises
• Complete Cost homework before
week 4 of class
Week
4
• Monitoring and Controlling the Project work
• Cost Control (Performance Measurements / Earned Value)
• Project Cost Management Summary
• Turn in final assessment email
answers to [email protected]
• Results will be provided within 2
weeks after completion.
Description Homework
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Agenda• Objectives / Syllabus
• Time Management Processes
• Project Time Management
• Project Cost Management
• Summary
Project Time Management
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How Time Management Processes Map to
PMI Process Groups (PMBOK p.70)
Knowledge Area Initiating Planning (21) Execution Controlling Closing
Integration 4.1, 4.2 4.3 4.4 4.5, 4.6 4.7
Scope 5.1, 5.2, 5.3 5.4, 5.5
* Time Mgmt. 6.1, 6.2, 6.3,
6.4, 6.5
6.6
Cost 7.1, 7.2 7.3
Quality 8.1 8.2 8.3
HR 9.1 9.2, 9.3 9.4
Communications 10.1 10.2 10.3, 10.4
Risk 11.1, 11.2, 11.3,
11.4, 11.5
11.6
Procurement 12.1, 12.2 12.3, 12.4 12.5 12.6
* Notice Time Management falls in planning and controlling process groups
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Where Time Management Processes
fit in?
INITIATING
PLANNING
CONTROLLING EXECUTING
CLOSING
Arrows represent flow of information
(6.1, 6.2, 6.3, 6.4, 6.5)
(6.6)
PMBOK Sections
PMBOK Section
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Project Management Knowledge Areas
Project
Integration
Mgmt
COMMUNICATIONS
SCOPE
PROJECT
SUCCESS
STAKEHOLDER SATISFACTION
TIME COST QUALITY
Procurement HR RISK
We are here
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Agenda• Objectives / Syllabus
• Time Management Processes
• Project Time Management
• Project Cost Management
• Summary
Project Time & Cost Management
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Project Time Management
“includes the processes required to
ensure timely completion of the
project.”
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Project Time Management Processes
PMBOK Section 6 (p.123-156)
1. Activity Definition
2. Activity Sequencing
3. Activity Resource Estimating
4. Activity Duration Estimating
5. Schedule Development
6. Schedule Control
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Activity Definition (6.1, p.127)
• Process to identify the deliverable at the lowest level of the WBS, i.e., “work packages”.
– Includes schedule activities and milestones required to complete deliverables on the project.
– Use “eight to 80 hour rule of thumb” for better management of work packages (when appropriate).
• Work packages are planned (decomposed) into smaller components called schedule activities.
• Provides bases for estimating, scheduling, executing, monitoring/controlling project work.
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Hierarchy
PROGRAM
PROJECT A PROJECT B
SUB PROJECT SUB PROJECT SUB PROJECT
SUMMARY TASKS
(WORK ITEMS)
SUMMARYTASKS
(WORK ITEMS)
SUMMARY TASKS
(WORK ITEMS)
* WORK
PACKAGES
* WORK
PACKAGES
* WORK
PACKAGES (8-80 hour rule)
- Activities
Note: Activities are also known as Schedule Activities
- Activities - Activities
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Activity Definition (p.127-129)
• Inputs
• Enterprise Environmental Factors
• Organizational Process Assets
• Project Scope Statement
• Work Breakdown Structure (WBS)
• WBS Dictionary
• Project Management Plan
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Activity Definition (p.127-129)
•Tools and Techniques• Decomposition
• Rolling Wave Planning
• Templates
• Expert Judgment
• Planning Component
Outputs• Activity List
• Milestone List
• Activity Attributes
• Requested Changes
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Activity Definition Format
• Suggested format (Post-it note):
Early Start
Late Finish
Early Finish
Late Start Duration
Activity
Id #
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Team Exercise – Activity Definition
• Break into your teams (take 20 minutes.)
• Pick a new PM for the exercise
• Review your WBS and further define
activities as needed (at least 15 activities)
– Put your project activities on Post-it notes and use action
words (verbs).
– Use “code of accounts” (numbering system).
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Activity Sequencing (6.2, p.130-135)
“Involves identifying and documenting
logical relationships among schedule
activities.”
• INPUTS
• Project scope statement
• Activity list
• Activity attributes (p.130)
• Milestone list
• Approved change requests
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Activity Sequencing Tools and Techniques
• Precedence Diagramming Method (PDM)
• Arrow Diagramming Method (ADM)
• Schedule Network Templates
• Dependency Determination
• Mandatory Dependency (i.e., foundation before building)
• Discretionary (preferred logic or “soft” logic)
• External (i.e., building permit before begin building)
• Applying leads and lags
• Lead is negative lag
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Activity Sequencing Tools
• PDM (aka Activity on Node) •Nodes are activities
•Events are node ends (in the box)•Relationships are node to node pairs
•Four relationships are possible
A B
D
C
End
Start
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Logical Activity Relationships
Finish to Start (FS) – activity B
can’t start until activity A is
finished (only relationship used in AOA)
Finish to Finish (FF) – B can’t
finish until A finishes (PDM)
Start to Start (SS) – B can start
when A has started (PDM)
Start to Finish (SF) – B can’t
finish until A starts (PDM)
A B
A B
A
B
A B
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Example - Activity On Node (AON)
Start End
Also known as the Precedence Diagram Method (PDM)
Critical Path
Toast bread t=2 Butter toast t=.5
Boil water t=7 Boil egg t=3
Set table t=2 Pour cereal t=1
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Relationship of Activities
• Predecessor: An activity that exists on a common logic path with
activity “A” occurring before activity “B”
• Successor: An activity that exists on a common logic path with
the activity “B” occurring after activity “A”
A BActivity “B” is a successor to
activity “A”
Activity “A” is a predecessor to
activity “B”
FS
FS = Finish to Start
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Activity Sequencing
A BFS +1d
LAG
• Finish-to-Start with lag timeThe successor of the relationship cannot start
until the predecessor finishes and some
passage of time determined by the lag
occurs
Paint the wall Hang the pictures
1d = One Day
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Activity Sequencing
• Start-to-Start with lag time
The successor of the relationship cannot start
until the predecessor is started and some
passage of time determined by the lag occurs
A
BSS +1d
Lag
Build forms
Pour Cement
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Activity Sequencing
• Finish-to-Finish
The successor of the relationship cannot finish until
the predecessor is finished
A
B
FFCook
TurkeyCook
Rolls
Dinner is
served
Milestone
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Activity Sequencing
• ADM (Arrow Diagramming Method
(aka Activity on Arrow (AOA)
– Arrows are events
– Activities are pairs of events
– Relationships are nodes & dummies
– Uses only finish to start dependencies
A BC
DDummies are shown as dotted
lines and have no resources
assigned FE
Start
End
G
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Example - Activity On Arrow (AOA)
1 3
2
4
5
EndStartBoil water t=7 Boil egg t=3
Also known as Arrow Diagram Method (ADM)
Critical Path
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Activity Sequencing
• Outputs
- Project schedule network diagram- Diagram of activities & logic relationships
- Activity list (updates)
- Activity attributes (updates)
- Requested change
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Team Exercise - Activity Sequencing
• Break into your teams (take 20 minutes)
• Lay out your network diagram
• Get flip chart paper and tape the sheets together as needed
• Put your activities in the sequence your team feels is
appropriate
• Add lines (in pencil) between your activities (in relationships)
• PM to present your diagram
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Activity Resource Estimating (6.3)
• Determining what resources (people,
equip., material) and what quantities
will be needed to perform project
activities.
• INPUTS– Enterprise Environmental Factors
– Organizational Process Assets
– Activity List
– Activity Attributes
– Resource Availability
– Project Management Plan
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Activity Resource Estimating
• Tools and Techniques– Expert Judgment
– Alternatives Analysis
– Published Estimating Data
– Project Management Software
– Bottoms-Up Estimating
• Outputs– Activity Resource Requirements
– Activity Attributes (updates)
– RBS (Resource Breakdown Structure)
– Resource Calendar (updates)
– Requested Changes
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Assigning Activities – Example of RAM
Responsibility Assignment Matrix
(RAM)
Sue Don Jose
1.1.3 Revise Plan
1.1.4 Fix the Fence
1.2.3 Get Equipment
1.2.4 Pay for Equipment
Note: should be closely tied to cost estimating process
i.e., per hour rates, overtime rates, etc.
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Activity Duration Estimating (6.4)
Process of estimating activity duration
• Inputs (p.139)- Enterprise Environmental Factors
- Organizational Process Assets
- Project Scope Statement
- Activity List
- Activity Attributes
- Activity Resource Requirements
- Resource Calendar
- Project Management Plan
- Risk register and Activity cost estimates
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Activity Duration Estimating
• Tools and Techniques- Expert Judgment
- Analogous Estimating (Top Down, early in the
life cycle, using historical information on
similar projects)
- Parametric Estimating (math model)
- Three-Point Estimates ((P+4M+0)/6)
- Reserve Analysis (Contingency)
• Outputs- Activity Durations Estimates (work periods
usually in days)
- Activity Attributes (updates
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Team Exercise
Activity Duration Estimating
• Break into your teams (take 30 minutes.)
• Determine the appropriate (best guess) duration estimate for
each project activity • Assumptions (for purposes of this exercise only):
1. Focus on activity estimates for labor only (round hours up to
whole days) and mark in pencil on your post it notes.
2. Estimates for your team members only (subcontractors will
provide bids with their cost estimates separately).
• PM to present total number of days for your project.
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Schedule Development (6.5)
• Once the network diagram and estimates are complete, it is time to build a schedule (calendar based timeline of when activities need to be completed).
• Inputs– Organizational Process Assets
– Project Scope Statement
– Activity List
– Activity Attributes
– Project Schedule Network Diagrams
– Activity Resource Requirements
– Resource Calendars
– Activity Duration Estimates
– Project Management Plan
- Risk Register
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Schedule Development
• Tools and Techniques– Schedule Network Analysis
– Critical Path Method
– Schedule Compression (crashing & fast-tracking)
– What-If Scenario Analysis
– Resource Leveling
– Critical Chain Method
– Project Management Software
– Applying Calendars
– Adjusting Leads and Lags
– Schedule Model
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Duration Compression
• Fast-track the plan – doing activities in
parallel (adds risk to the project)
• Crashing the plan – how to obtain the
greatest amount of compression for the
least in incremental cost (always adds cost
to the project).
• Ways to Crash the project schedule:
• Adding Resources (People)
• Working Overtime or Adding Shifts
• Subcontract Work / Activities
• Expedite Material Deliveries
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Schedule Development
• Tools (continued):
- Critical Path
– The longest activity sequence in the network
(represents the longest path)
– Has zero total float
– Controls the project finish date
– Can be shortened through parallel activity
sequencing
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Schedule Development
• Tools (continued):
- Forward Pass – Network calculations
which determine the earliest dates an
activity can occur
– Early Start –The earliest an activity may
begin as logically constrained by the network
– Early Finish – The earliest date an activity
may finish as logically constrained by the
network
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Example Schedule Development
Activity Predecessor Duration
Start -- 0
A Start 4
B Start 8
C A 4
D B 1
End C,D 0
Note: Milestone activities always = Zero (0) Duration
Dummy activities are only used on AOA and = 0 Duration
fill in diagram on slide 42
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Schedule Development
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Schedule Development
Start
0 days
D
1 day
End
O days
C
4 days
A
4 days
B
8 days
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Forward Pass – helps determine
overall length of the project
• Doing the Forward Pass will determine the Early
Start and Early Finish times for each activity
• Early Start for the first activity “A” is usually Zero
• The Early Finish of “A” is calculated by adding the
duration of the “A” to its Early Start (Early Start +
Duration = Early Finish)
• The Early Finish of “A” then becomes the Early
Start for the next activity, and so on…
• Complete the Forward Pass for the entire project
to determine the total project duration
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Forward Pass
Start
0 days
D
1 day
End
O days
C
4 days
A
4 days
B
8 days
ES EF4 8
8 90 8
9 9
Note: start with 0
0 4
EF = Early start, EF = Early Finish
ES EF
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Forward Pass - CPM (Critical Path Method)
Start
0 days
D
1 day
End
O days
C
4 days
A
4 days
B
8 days
0 4 4 8
8 90 8
9 9
Note: always start with 0
Critical Path = longest path: Start, B, D, End (=9 days)
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Forward Pass (add dependency)
Start
0 days
D
1 day
End
O days
C
4 days
A
4 days
B
8 days
0 days
0 4 8 12
8 90 8
12 12Note:
always start with 0
• Now add a dependency from B to C
• Use a dependency line (with 0 duration)
Note: how does this changes impact the Critical Path?
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Schedule Development Tools
• TOOLS
- Backward Pass – Network calculations
which determine the latest dates each
activity must occur
• Late Start –The latest date an activity may
begin as logically constrained by the network
• Late Finish – The latest date an activity may
finish as logically constrained by the network
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Backward Pass (Next Step)
• Doing the Backward Pass will determine the Late Start and Late Finish times for each activity in the project.
• Starting with the final activity and working backward, subtract the duration of the last activity from its Late Finish to arrive at its Late Start time (Late Finish - Duration = Late Start) – note: always take the lowest # going back.
• When more than one activity succeeds a given task, the earliest of the Late Start dates of the successor activities is selected to become the Late Finish date.
• The Late Finish is the latest that a given activity may finish without delaying the completion of the project.
• Complete the Backward Pass for the entire project to determine the Critical Path.
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Backward Pass
Start
0 days
D
1 day
End
O days
C
4 daysA
4 days
B
8 days
Note: start with 05 9
9 9
8 90 8
1 5
LS LF LS LF
LS = Late state, LF = Late finish
LF minus task Duration = LS
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Schedule Development Tools
(continued)
• Float (Synonymous with Slack)
• Total Float (slack) is the amount of time an activity can be delayed
without delaying the project end date or an intermediary milestone.
• Activities on Critical Path have Zero (0) Float
• To calculate an task or activities float;
• (Late Start - Early Start or Late Finish - Early Finish = Float)
• Free Float (slack) is the amount of time an activity can be delayed
without the early start date of its successor.
• (Early Start B – Early Finish A = Free Float of A)
• Project Float (slack) is the amount of time a project can be delayed
without delaying the externally imposed project completion date
required by the customer, management or date committed by the PM.
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Calculating Float
Start
D
A
E
F
B
G
H
C
Finish
2
7
6
5
3
1
5
8
15 15
7
0
0
15
9
10
7
7
821
20
15
14
20
20
7
7 15
21
2120
20
1512
129
15
149
10
I
9
21
21
30
30
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Schedule Development
• Outputs (p.149-152)– Project Schedule
– Schedule Model Data
– Schedule Baseline
– Resource Requirements (updates)
– Activity Attributes (updates)
– Project Calendar (updates)
– Requested Changes
– Project Management Plan
– Schedule management plan
Note: see PMBOK figure 6-10 p.150 for good example of project schedule graphic
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Critical Path Team Exercise
• Break into your teams (take 30 minutes)
• Pick a new PM to manage the team exercise
• Do a forward pass on your activities
• Do a backward pass on your activities
• Calculate float on your activities
• Determine critical path and highlight it
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Schedule Control (6.6 p.152)
• Concerned with determining current status of project schedule and managing schedule changes.
• Inputs- Schedule Management Plan
- Schedule Baseline (slide 56)
- Performance Reports (slide 57)
- Approved Change Requests
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Schedule Control
• Schedule Baseline
• Baseline (target) Schedule –
Contains the
approved work scope prior to
progress reporting
• Working Schedule – The
baseline schedule after
progress reporting
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Schedule Control
• Performance Reports
• Data Date – The starting date of all remaining
work
or “Time Now”
Actual Start – The calendar date that work
actually began
on an activity
Actual Finish – The calendar date that all work
was completed
on an activity
Percent Complete – Derived from and
assessment of the
work in progress
Remaining Duration – Work periods left
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Schedule Control
• Tools and Techniques
- Progress Reporting- Schedule Change Control System- Performance Measurement- Project Management Software- Variance Analysis- Schedule Comparison Bar Charts
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Schedule Control
• Schedule Change Control System
• Includes paperwork, tracking systems, and
appropriate
levels of approval
• Is integrated with the overall project change
control system
• Progress Reporting
• Trending, Forecasting, and “What-Ifs"
• Target Variance Analysis
• Schedule Variance Analysis
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Schedule Control
• Outputs
- Schedule Model Data (updates)- Schedule Baseline (updates)- Performance Measurements- Requested Changes- Recommended Corrective Action- Organizational Process Assets (updates)- Activity List (updates)- Activity Attributes (updates)- Project Management Plan (updates)
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Schedule Control
• Schedule Baseline updates• Keep stakeholders apprised of schedule updates on a
regular basis.
• What if Scope changes?
• What if Schedule isn’t performing to plan?
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Agenda• Objectives / Syllabus
• Time Management Processes
• Project Time Management
• Project Cost Management• Summary
Project Cost Management
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Cost Management Objectives
• Understand basic building blocks of project cost management according to PMI and real world.
• Understand the function of the project manager in managing cost and budget on your project.
• Know the purpose of Earned Value and how to calculate using the key formulas.
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Project Cost Management
(PMBOK - Chapter 7, p.157-178)
“Includes the Processes Required to
Ensure That The Project Is Completed
Within The Approved Budget”
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How Cost Management Processes Map to PMI
Process Groups (PMBOK p.70)
Knowledge Area Initia
ting
Planning (21) Execution Controlling Closing
Integration 4.1,
4.2
4.3 4.4 4.5, 4.6 4.7
Scope 5.1, 5.2, 5.3 5.4, 5.5
Time Mgmt. 6.1, 6.2, 6.3, 6.4,
6.5
6.6
* Cost Mgmt. 7.1, 7.2 7.3
Quality 8.1 8.2 8.3
HR 9.1 9.2, 9.3 9.4
Communications 10.1 10.2 10.3, 10.4
Risk 11.1, 11.2, 11.3,
11.4, 11.5
11.6
Procurement 12.1, 12.2 12.3, 12.4 12.5 12.6
•Notice Cost Management falls in planning
and controlling process groups
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Cost Management Processes
PMBOK Section 7 (p.157-178)
1. Cost Estimating
2. Cost Budgeting
3. Cost Control
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Cost Estimating (7.1, p.161)
• Involves developing an estimate of the cost of
the resources needed to complete each schedule
activity and looking at alternatives.
• Inputs• Enterprise Environmental Factors
• Organizational Process Assets
• Project Scope Statement
• WBS/WBS Dictionary
• Project Management Plan
-schedule management plan
-staffing management plan
-risk register
69
Cost Estimating
• Tools and Techniques (section 7.1.2)• Analogous Estimating
• Determine Resource Cost Rates
• Bottom-Up Estimating
• Parametric Estimating
• Project Management Software
• Vendor Bid Analysis
• Reserve Analysis
• Cost of Quality
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Cost Estimating Tools Descriptions
• Tools & Techniques for cost estimating:• Analogous estimating – “Top-Down” estimating, means
using actual cost of previous similar projects as basis for
estimating the current project.
• Parametric modeling – involves using project characteristics
(parameters) in a mathematical model to predict project costs;
e.g., using cost per square foot for residential home
construction.
• Bottom-up estimating – involves estimating the cost of
individual work items and then summarizing (rolling up) the
individual estimates to get a project total.
• Computerized tools – such as project management software
and spreadsheets are widely used to assist with cost
estimating.
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Cost Estimating
• Outputs- Activity Cost Estimates
- Activity Cost Estimates and
Supporting Detail
- Requested Changes
- Cost Management Plan (updates)
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Cost Estimating
• Types of Cost Estimates and Ranges of Accuracy
• Order of Magnitude Estimate
(-25% to +75%)
• Budget or Preliminary Estimate
(-10% to +25%)
• Definitive Estimate
(-5% to +10%)
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Team Exercise - Cost Estimating
• Break into your teams
• Pick a new PM to report findings
• Pick the type of estimating you will use, i.e.,
ROM, Bottom Up, etc.
• Re-estimate your project using work effort
estimates instead of duration.
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Cost Budgeting (7.2)
• Inputs• Activity Cost Estimates
• WBS / WBS Dictionary
• Project Schedule
• Resource Calendars
• Contract
• Cost Management Plan
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Cost Budgeting
• Tools and Techniques• Cost Estimating Tools and Techniques
• Outputs• Cost Baseline
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Contingency Reserves
• Reserve Analysis
• Provides for unforeseeable elements of cost within
the defined project scope (“Known Unknowns”)
• Held inside the project budget
• Reserve does not cover:
• Inflation or cost escalation
• Change in scope
• Change in quality
• Cost overruns due to poor estimates
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Managerial Reserve
• Allocates and maintains funds for
future situations which are
impossible to predict (“Unknown
Unknowns”)
• NOT to be used to fund bad cost
estimates
• Controlled by upper management
and held outside the project
budget.
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Cost Baseline
• Establishes a Budget Baseline of costs relative to
time
• Allows comparison, analysis and forecasts of costs• Typically shown graphically comparing budget costs relative to time• Equivalent to Planned Value (budgeted cost of work scheduled) (PV or BCWS) • Excludes:
• Managerial reserves• Fees
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Team Exercise - Create a Budget
• Break into your teams
• Create your project budget using
your definitive estimates,
contingency reserve and managerial
reserve.
• Pick a new PM to report out to the
class
80
Cost Control (7.3)
• Includes managing the actual changes and influencing
factors that create changes to the cost baseline.
• Inputs
• Cost baseline
• Project funding requirements
• Performance reports
• Work Performance Information
• Approved Change requests
• Project management plan
81
Cost Control
• Tools and Techniques• Cost change control system
• Performance measurement analysis
• Forecasting
• Project performance reviews
• Project management software
• Variance management
82
Cost Control
• Outputs
• Cost estimate (updates)
• Cost baseline (updates)
• Performance measurements
• Forecasted completion
• Requested changes
• Recommended corrective actions
• Organizational process assets (updates)
• Project management plan
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• Earned Value Technique is a method used to
measure project performance against the project
baseline. Results from an earned value analysis indicate
potential deviation of the project from cost and schedule
baselines.
Cost Control Using Earned Value
84
Who Needs Earned Value?
Project Managers
Team Supervisors
Project Sponsors
Project
Stakeholders
85
Earned Value Terms:
PV = estimated value of work scheduled or planned to be done
EV = estimated value of work accomplished or performed
AC = actual cost of work accomplished or performed
BAC = budget at completion, sum of the total budgets for a project
EAC = estimate at completion, anticipated total cost at project completion
ETC = estimate to completion, expected additional cost needed to complete the project
VAC = variance @ completion, how much over / under budget project is @ completion.
Cost Control Using Earned Value
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CV = EV-AC negative is over, positive is under budget
SV = EV-PV negative is behind, positive is ahead of schedule
CPI = EV/AC we are getting $____ for every dollar spent
SPI = EV/PV we are progressing at ____% of rate originally planned
EAC = BAC/CPI as of now, how much do we expect the total project to cost (note: there are several formulas to calculate EAC this one is most often asked on the exam. It would be best to memorize all formulas on page 207 of Rita’s exam prep book)
EAC = AC+ (BAC - EV) actual to date plus remaining budget
EAC = AC+ (BAC - EV) / CPI actual to date plus remaining budget modified by performance
ETC = EAC-AC how much more will the project cost
VAR = BAC-EAC how much over or under budget will we be at the end of the project
Formulas to Memorize
Source – Rita’s book page 207
87
Estimate At Completion (EAC)
• Estimate At Completion (EAC) is a forecast of total
project cost based on project performance. EAC
formulas to use:
EAC = AC + ETC (If original estimates were flawed)
EAC = AC+BAC - EV ( If current variances are not typical and are not
projected to continue)
EAC = (AC+(BAC-EV/CPI)) (If current variances are typical of future
variances)
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Sample Earned Value Performance
Measurement Analysis Chart
EAC
BACVAC
SLIPPAGE
COST
VARIANCE
SCHEDULE
VARIANCE
PV
AC
EV
$
NOW
Time
Cumulative Cost Curve
• Point in time check point
89
Tips to Help Remember EV Formulas
EARNED VALUE CALCULATIONSKEY FORMULAS
CV = EV - AC
CPI = EV / AC
SV = EV - PV
SPI = EV / PV
Percent Complete = EV / BAC * 100
• EV usually always first in the formula
• Variance is always minus (EV – x)
• Indexes always divide (EV / x)
TIPS:
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Agenda• Objectives / Syllabus
• Time Management Processes
• Project Time Management
• Project Cost Management
• Summary
Project Time & Cost Management
91
Time & Cost Management Summary
• Know the six time management processes
• And the three cost management processes
• Know that schedule variance is the highest
source of conflict on a project
• Know how to calculate the critical path
• Know that milestones carry zero duration
• Know earned value formulas and
estimating types and ranges of estimates
• Managing the cost and schedule is
essential to the success of the project.
92
Congratulations!
• You have
completed another
section. . .