OPMA 5364
Project Management
Part 4
Starting & Planning a Project
Topic Outline: Starting & Planning a Project
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Project launch meeting
Identifying necessary activities
Work Breakdown Structure (WBS)
Estimating activity durations
Identifying necessary resources
Project budgeting
Top-down vs. bottom-up approaches
Project planning exercise
Learning curves
Project action plan
Responsibility chart
Interface map
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Project Launch Meeting
PM should first meet with the senior manager
who will be responsible for the project. Why?
Next, a project launch meeting should be
held.
What is the purpose of this initial meeting?
Who should be invited?
What should be the results of this meeting?
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Project Planning Process
1.
2.
3.
4.
5.
6.
Clearly define project objective (scope)
Develop a Work Breakdown Structure (WBS)
Estimate time needed for each task
Determine resources needed for each task
Estimate cost needed for each task
Develop project schedule and budget (adjust
as needed)
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Project Scope
A clear project scope definition provides the guidelines
that are used to develop your project plan.
Project Scope Checklist:
• Project objectives (purpose, due date, budget)
• Deliverables (at each major phase of project)
• Milestones (significant events in the project)
• Technical requirements
• Limits and exclusions (who, what, how)
• Review with customer (agreement on expectations)
Example of project scope statement
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Identifying Necessary Activities
• Start by identifying major-level activities or tasks
• Then each major task can be broken down into
subtasks
• Project team members can be responsible for
breaking down different major activities
• Then each subtask is broken down to lowerlevel tasks, and so on until you have basic workunit levels (work packages) that will be assigned
• Result: Work Breakdown Structure (WBS)
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Mind Maps
• Mind maps are a tool to help identify all the
necessary activities in a project
• It’s a type of brainstorming tool
• The mind mapping process can bring out more
ideas than simply making a list
• It engages the team and generates enthusiasm
• It brings out quieter team members
• Mind mapping can be fast, compared to an
outlining or listing approach
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Mind Map for Project Planning
Registration
Transportation
Promotion
10K run to
raise $50K
for homeless
shelter
Route
Prizes/recognition
Clean-up
Refreshments
Safety
Facilities
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Mind Map for WBS
Investigate
past events
Interview
running
club
members
Produce
ads
TV and
radio ads
Research
Promotion
Purchase
air time
Monitor
airings
Flyers
Print
Design
Mailings
Mail
promo
Distribute
Prepare
mailing
To schools
To sports
retailers
Acquire
address
lists
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Work Breakdown Structure
• Either shown graphically in a tree structure, or
as index numbers listed beside activities
• Entire project is Level 0; the major-level activities
are Level 1; and so on
• Index numbers identify level of the task in the
tree structure
• WBS # 4.2.5 indicates that the task is at Level 3
(3 decimal places) and is the 5th sub-subtask
under the 2nd subtask under the 4th major activity
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WBS Tree Structure
Level
Carnival
Beth
0
1
1
Volunteers
Joan
2.1
2
3
Posters
Bob
2
Promotion
Beth
2.2
Newspaper
Beth
3
Games
Tom
4
5
Entertain.
Jill
Rides
Kyle
2.3
Tickets
Mark
5.1
Grandstand
Mark
5.1.1
Stage
Alan
5.1.2
Sound
Ben
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Food
Bob
5.2
Performers
Jill
5.1.3
Seating
Mark
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WBS Activity List
WBS
1
2
2.1
2.2
2.3
3
4
5
5.1
5.1.1
5.1.2
5.1.3
5.2
6
Activity
Carnival
Volunteers
Promotion
Posters
Newspaper
Tickets
Games
Rides
Entertainment
Grandstand
Stage
Sound
Seating
Performers
Food
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WBS for Promotion Example
Level 1 Task
Level 2 Tasks
Level 3 Tasks
1. Promotion
1.1 Research
1.1.1 Investigate past events
1.1.2 Interview running club members
1.2 TV and radio ads
1.2.1 Produce ads
1.2.2 Purchase air time
1.2.3 Monitor airings
1.3 Mailings
1.3.1 Acquire mailing lists
1.3.2 Prepare mailings
1.3.3 Mail promotional materials
1.4 Flyers
1.4.1
1.4.2
1.4.3
1.4.4
Design flyers
Print
Distribute to schools
Distribute to sports retailers
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Estimating Activity Durations
Two Approaches
1. Bottom-up estimate: Ask the person
responsible for each low-level task how long
they think it will take. This assumes a given
amount of resources.
2. Top-down estimate: Based on the project due
date, tell the person responsible for each lowlevel task how much time they are allotted to do
the task. They must then determine how much
resources are needed to meet the deadline.
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Estimating Activity Durations
For a given amount of resources, how can you
estimate a task duration?
• use the expert’s best guess (person doing task)
• use past data, if task has been done before
• use engineering standards or work standards
• dissect task into different elements and estimate
time needed for each element
The task time estimate should reflect the most
likely time needed to do the task.
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Identifying Necessary Resources
To complete a task within a given amount of time,
what resources will be required?
• How many and what types of employees
• What facilities
• What equipment
• What materials and supplies
• What services
• What information and technologies
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Top-Down vs. Bottom-Up Budgets
• Top-Down Budgeting: Senior management
decides how much they think the project should
cost, and that becomes the total project budget.
The budget is then divided among the activities.
– Advantages and disadvantages?
• Bottom-Up Budgeting: Cost estimates for
each task are solicited from those responsible
for the tasks. These estimates are rolled up for
all activities to get the total project budget.
– Advantages and disadvantages?
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Estimating Activity Costs
• Estimates for both time and cost of activities
should be done with same approach, either topdown or bottom-up (or somewhere in between)
• Two initial budget estimates may be developed
for some projects, a top-down and a bottom-up.
Which will most likely be higher? Why?
• The project manager must then negotiate with
senior management to finalize the budget
• Tradeoffs may be necessary between the cost,
due date, and the extent and quality of outputs
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Baseline Plan
• The finalized budget, time estimates, and
resulting project schedule are the basis for the
baseline plan.
• The baseline plan lays out the target levels of
progress and performance at the outset of the
project execution phase.
• It is the basis for assessing project performance
throughout the project
• Project tracking utilizes the baseline plan to
provide the project manager with a control tool
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Project Planning Exercise
Coffee House Implementation Project
• Divide into small groups
• Your group has decided to form a partnership and open
a new coffee house in an old restaurant building in
downtown Fort Worth . The project starts now and ends
in 12 weeks when the coffee house opens for business.
• Assignment:
(40 minutes)
– Develop a list of necessary activities (use mind map)
– Estimate the duration of each activity
– Decide what resources are needed for each activity
– Estimate the budget to start the new coffee house
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Project Action Plan
For each activity, action plan should at least show
• Activity name
• Time duration estimate
• Start date
• Immediate predecessor activity
• Resources needed
Optionally, it might also show finish date, WBS
index, cost, slack time, latest finish date, etc.
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Action Plan in Microsoft Project
ID Task Name
Duration
Start
Predec.
Resourc
1 Proj. approval
0 days
2 Script writing
14 days
3/1/04 3/19/04 1
SW
3 Sched. shoots
17 days
3/1/04 3/24/04 1
C,P,S
4 Script approval
8 days
3/19/04 3/31/04 2
C,P
5 Revise script
5 days
3/31/04
P,SW
6 Shooting
10 days
3/1/04
Finish
3/1/04
4/7/04 4
4/7/04 4/21/04 3,5
P,S,SW
7 Editing
7 days
4/21/04 4/30/04 6
E,ER
8 Final approval
2 days
4/30/04
5/4/04 7
C,P,E
9 Deliver to client
0 days
5/4/04
5/4/04 8
C=client, E=editor, ER=editing room, P=producer, S=secretary, SW=scriptwriter
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Learning Curves
• What is the learning phenomenon?
• Under what circumstances is worker learning
important to consider and plan for?
• How does the learning curve phenomenon affect
budgeting?
• How are task durations estimated when worker
learning is relevant?
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Task Times With Learning
Time to produce nth unit with 85% learning:
Unit#
Time
1
43
2
4
8
16
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Learning Curve Formula
Time to produce the nth unit, learning rate LR:
Tn = T1(n)r
where
r = (log LR)/(log 2)
or r = (ln LR)/(ln 2)
So, the 8th unit with 85% learning & T1=43:
r = (ln 0.85)/(ln 2) =
T8 = T1(n)r = 43(8)-0.2345 =
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Learning Curve Tables
• Time to produce 8th unit:
T8 = T1*(unit time factor from table)
T8 =
• Total time to produce first 8 units:
T1-8 = T1*(total time factor from table)
T1-8 =
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Example Situation
• A firm has a project to produce 21 units of a
new part for a customer.
• The firm’s typical learning rate is 85%.
• The first unit of the part that was produced
(the prototype) required 43 hours to make.
• Labor cost is $27 per hour.
• Pricing policy is 3 times the total labor cost.
• How much should customer be charged?
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Learning Curve Tables
How much should firm charge for job?
T1-21 =
What if customer wants 4 additional units?
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Learning Curve Tables
T1-25 =
T22-25 = T1-25 – T1-21
=
price for #22-25
or
Do learning curves help justify volume
discounts?
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Project Charter
(or Project Master Plan)
Agreed-upon, legally binding project plan (the final plan)
1. Overview
2. Objectives
3. General approach
4. Contractual aspects
5. Schedules
6. Resources and budgets
7. Personnel
8. Evaluation methods
9. Potential problems
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Project Charter
1.
Overview
• Intended for senior management
• Brief description of project & deliverables
• List of major milestones
• Likely profitability & competitive impacts
2.
Objectives
• Purpose of project
• More detailed description of deliverables
• Could be in the form of a project mission statement
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Project Charter
3.
General Approach
• Technical and managerial approaches
• Relationship with other projects
4.
Contractual Aspects
• Description of all agreements (client, others)
• Reporting requirements, technical specs, delivery
dates, penalties, process for changes
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Project Charter
5.
Schedules
• Outline of all schedules and milestones
• Project action plan, WBS
6.
Resource Requirements
• All capital and operating expenses
• Cost monitoring and control procedures
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Project Charter
7.
Personnel
• What types of personnel are needed and when
• Skill requirements, necessary training, security
clearances, nondisclosure agreements
8.
Evaluation Methods
• Descriptions of all procedures and standards for
evaluating project—how information will be
collected, stored, monitored
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Project Charter
9.
Potential Problems
• List of potential risks to project progress
• Contingency planning may prevent or soften the
impacts of some problems
Small or routine projects may not need all 9 of these
elements in the project charter, but larger projects
should have them.
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Responsibility Chart
• Often called Linear Responsibility Chart or
Responsibility Matrix
• Shows who has primary responsibility for each
task
• Can also show who provides support, who must
be notified upon completion, who must give final
approval, who is the backup person, etc.
• It lets everyone see their roles throughout the
project
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Responsibility Chart
WBS
Activity
Beth
Joan
Bob
Carnival
P
S
S
P
S
Mark
Tom
Kyle
Jill
S
S
S
Alan
Ben
1
Volunteers
2
Promotion
2.1
Posters
2.2
Newspaper
2.3
Tickets
3
Games
P
S
4
Rides
S
P
5
Entertainment
S
S
5.1
Grandstand
5.1.1
Stage
P
S
5.1.2
Sound
S
P
5.1.3
Seating
P
S
S
5.2
Performers
S
6
Food
P
P
S
S
P
S
S
S
P
P
S
P
S
P
P
P = Primary responsibility; S = Support responsibility
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Interface Map
• Shows who each person or department must
interface with and why
• Shows participants how they fit in with other
parts of the project
• Facilitates coordination
• Allows for early identification of potentially
troublesome interfaces (personality clashes)
• New interface maps can be developed for
different phases of the project
Part 4 - Project Planning
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Interface Map
Adapted from: Bailetti, Callahan, and DiPietro, Nov. 1994, IEEE Transactions on
Engineering Management
Review
Review
Program
manager
Review
Technical
overview
Project
schedule
Create
Use
Review
contribute
Project
manager
Create
Use
Use
Review
Chip
schedule
Chip
manager
Process
file
Create
Use
Cell
library
Use
Use
Create
Use
Test
vectors
Use
Chip
specification
Process
technology
Manufacturing
Use
Design
team
Layout
Review
Use
Use
Create
Cell library
group
Create
Layout
specialist
Create
Chip
design
High level
design
Schematic
Netlist
Use
Verification
plan
Verification
vectors
Simulation
prelayout
Part 4 - Project Planning
Simulation
postlayout
39