University of Business & Technology
College of Engineering
PROJECT MANAGEMENT
Dr. Ashraf Hassan
Industrial Engineering Department
5. Work breakdown
structures (WBS)
Work breakdown structure (WBS)
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The work breakdown structure (WBS) is a method for
project planning and control. A project is broken down into
its major components which are then subdivided into
detailed subcomponents, which are further broken down
into activities and, finally, individual tasks.
The WBS format is a good way to identify activities and to
determine the individual task, and project workloads and
resources required.
Further, it helps to identify unnecessary duplication of
activities.
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Identify the major elements of the project, Level 2,
see Fig. below
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Identify the major supporting activities for each
of the major elements of the project, Level 3, see
Fig.
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Each of the major supporting activities is broken
down into a list of activities that will be needed to
accomplish it, Level 4, see Fig.
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Examples of WBS
Pharmaceutical factory
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Block A Administration block (offices and
laboratories)
Block B Incoming goods area, raw material store
Block C Manufacturing area 1 (pills)
Block D Manufacturing area 2 (capsules)
Block E Manufacturing area 3 (creams)
Block F Boiler house and water treatment
Block G Air-conditioning plant room and electrical
distribution control room
Block H Finished goods store
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General site services such as roads, sewers, fencing and
guard houses can be incorporated into Block A
or, if extensive, can form a block of their own.
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New housing estate
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Block A Low-rise ‫ منخفضة السعر‬housing area – North
Block B Low-rise housing area – East
Block C Low-rise housing area – South
Block D Low-rise housing area – West
Block E High-rise – Block 1
Block F High-rise – Block 2
Block G Shopping precinct
Block H Electricity substation
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Multistorey block of offices
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Block A Basement and piling work
Block B Ground floor
Block C Plant room and boilers
Block D Office floors 1–4
Block E Office floors 5–8
Block F Lift well and service shafts
Block G Roof
Block H Substation
Block J Computer room
Block K External painting
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Typical manufacturing unit
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Block A Incoming goods store
Block B Batching unit ‫وحدة تجميع‬
Block C Production area 1
Block D Production area 2
Block E Production area 3
Block F Finishing area
Block G Packing area
Block H Finished goods store
Block J Boiler room and water treatment
Block K Electrical switch room
Block L Administration block and canteen
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It can be seen that a WBS is a powerful tool which can
show graphically who is responsible for a task, how much
it should cost and how it relates to the other tasks in the
project.
once it has been accepted as a representation of the project
tasks, it will become a good base for drawing up the
network diagram.
Once the WBS has been drawn, a bottom-up cost estimate
can be produced starting at the lowest branch of the family
tree.
This is shown in Fig below.
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Giving numbers to the tasks, enables a logical costing system
to be built up as shown in Fig. below
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An alternative is the top-down cost allocation (Fig below)
The cost of the total project has been determined and is
allocated to the top package of the WBS.
The work packages below are then forced to accept the
appropriate costs.
In practice both methods may have to be used.
For example, the estimator of a project may use the
bottom-up method on a WBS to calculate the cost.
When this is given to the project manager, he may break
this total down into the different departments of an
organization and allocate a proportion to each,
Once names have been added to the work packages of a
WBS it becomes an Organization Breakdown Structure or
OBS.
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Figure 5.5
below shows a typical OBS for a
manufacturing project such as the assembly of a prototype
motor car.
It can be seen that the OBS is not identical to the WBS, as
one manager or task owner can be responsible for more
than one task.
the OBS can be expanded into a responsibility matrix to
show the responsibility and authority of each member of
the organization or project team.
Where,
A = Receiving monthly reports
B = Receiving weekly reports
C = Daily supervision
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Examples of OBS
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The quality assurance (QA) manager reports directly to the
director to ensure independence from the operating and
projects departments.
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He will, however, assist all operating departments with
producing the quality plans and give ongoing advice on
QA requirements and procedures
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as well as pointing out any shortcomings he may discover.
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Responsibility matrix
The matrix is drawn Figure 5.5 by writing the WBS work areas
vertically and the OBS personnel horizontally as shown in Fig.
5.6 below
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This
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6. Estimating
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Estimating is an essential part of project management
If the estimate for a project is too low, a company may
well lose money in the execution of the work.
If the estimate is high, the company may well lose the
contract due to overpricing.
The four main types of estimating techniques are:
1 Subjective
With this method the estimator relies on his
experience of similar projects to give a cost indication
based largely on very subjective ‘feel’.
The accuracy may well be in the order of ±40%.
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2 Parametric
By using well-known empirical formulae or ratios in
which costs can be related to specific characteristics
of known sections or areas of the project,
Ex: an architect will be able to give a parametric
estimate of a new house once he is given the cube
(height × length × depth) of the proposed building
and the standard of construction or finish. The
estimate will be in LE /cubic meter of structure.
Such parametric estimates can vary in accuracy
between ±10% and 20%.
3 Comparative
When a new project is very similar to another project
recently completed, a comparison can be made.
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A degree of error of only ±10%.
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An example of such a comparative estimate is the
installation of a new computer system in a building
when an almost identical system was installed 6
months earlier in another building nearby.
4 Analytical
The most accurate estimating method,
Each component must be given a cost value
including material and labour content.
The values are usually extracted from a database or
company archives and must be individually updated
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Whatever type of estimating method, extra sums must be
added to cover overheads, profit and contingencies.
This total is then the price, i.e. what the customer is being
asked to pay.
Often the estimate produced by the estimator is drastically
changed by senior management to reflect market
conditions, the volume of work in the company and the
strength of the competition.
From a control point of view, such changes to the final
price should be ignored, as they normally fall in the
profit/overhead bracket: are usually outside the control of
the project manager.
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THANK YOU VERY MUCH