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RTP - MOD-2.4 - Project Management Module
RTP - MOD-2.4 - Project Management Module
4: Project Management
Contents
1.0 Introduction ......................................................................................1 1.1 Project Life Cycle...............................................................................1 1.1.1 The Project Initiation Phase ..........................................................1 1.1.2 The Project Planning Phase ...........................................................2 1.1.3 Execution and Controlling .............................................................3 1.1.4 Closure ......................................................................................3 1.2 Project Planning and Scheduling ..........................................................4 1.3 Bar Chart Gantt Schedule .................................................................5 1.4 Work Breakdown Structure .................................................................7 2.0 Network Analysis ............................................................................. 10 2.1 Network Techniques ........................................................................ 10 2.2 Evolution of Network Techniques ....................................................... 10 2.3 Types of Network ............................................................................ 10 2.3.1 AOA Network ............................................................................ 11 2.3.2 Rules for AOA Network ............................................................... 11 2.3.3 Calculating project time from AOA Network ................................... 12 2.3.4 Calculating Floats in AOA Network ............................................... 12 2.4 Network Analysis............................................................................. 14 3.0 PDM Network ................................................................................... 19 3.1 Type of Dependancies ...................................................................... 19 3.2 Precedence Network Calculations ....................................................... 20 3.3 PDM Example ................................................................................. 21 4.0 Resource Management ..................................................................... 22 4.1 Resource Loading ............................................................................ 22 4.2 Resource Levelling........................................................................... 22 4.3 Resource Leveling Example............................................................... 23 5.0 Project Time Management................................................................ 26 5.1 Reducing Project Duration ................................................................ 26 5.1.1 Adding resources....................................................................... 27 5.1.2 Outsourcing project Work ........................................................... 27 5.2 Scheduling overtime ........................................................................ 27 5.3 Crashing Project.............................................................................. 28 6.0 Earned Values .................................................................................. 31 6.1 Earned Value reporting .................................................................... 31 6.2 Earned Value Analysis ...................................................................... 31 6.3 Earned Value Example ..................................................................... 32
6.4 Practice Examples ........................................................................... 32 7.0 Project Scheduling through Software ............................................... 34 7.1 Live Example of Scheduling of Project Activities ................................... 45 8.0 Bid Process Management ................................................................. 51 8.1 Objectives of Bid process Management ............................................... 51 8.2 Invitation of Bids............................................................................. 51 8.3 Type of Bidding Process.................................................................... 52 8.3.1 Two-Stage Bidding process ......................................................... 52 8.4 Procurement Criteria of International ................................................. 53 8.4.1 Technical proposal Evaluation Sample .......................................... 54 8.4.2 Financial .................................................................................. 54 8.4.3 Final Ranking............................................................................ 55 8.4.4 Time Line for Bid Process Management ......................................... 55 8.5 Swiss Challenge System in Bidding Process ......................................... 56 8.5.1 Approach ................................................................................. 56 8.5.2 Indian Experience in Bidding process............................................ 56 8.6 Bid Structure and Evaluation............................................................. 57 8.7 Bid Design...................................................................................... 57 8.8 Prequalification and Short listing-Introduction ..................................... 57 8.9 Choosing the method of Award.......................................................... 58 8.10 Competitive Bidding ....................................................................... 58 8.11 Competitive Negotiations ................................................................ 59 8.11.1 Advantages of Competitive Bidding ............................................ 60 8.11.2 Limitations of Competitive Bidding ............................................. 60 8.12 Contracts won by Negotiation .......................................................... 61 8.13 Direct Negotiations and Unsolicited Proposals .................................... 61 List of Annexures Annexure I: Sample Format for MOU Annexure II: Selection of Consultants
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1.0 Introduction
Project management is an activity to ensure smooth implementation of any as per its specification. The following sections detail out the key concept project management.
A Project Feasibility Document This identifies project constraints, alternatives and related assumptions applied to the end product to be developed. Project feasibility is characterized by four basic components: Business Problem Description. Approach Overview to be used to develop. Potential Solutions of the problem. Preliminary Recommendations.
B Development of Project Concept Document It determines what is to be done? How will it be done? & why is it to be done? Thus determining the business value achieved after project completion. C Creation of Project Charter Project Charter formally communicates the initiation of the project. It consists of Project Scope, Project Authority and Critical Success Factors.
B The basic processes of the Project Planning Phase are: Scope Planning: This specifies the in-scope requirements for the project. Preparing the Work Breakdown Structure: This specifies the breakdown of the project into tasks and sub-tasks. Organizational Breakdown Structure: This specifies who all in the organization need to be involved and referred for Project Completion. Resource Planning: This specifies who will do what work at which time of the project. Project Schedule Development: This specifies the entire schedule of the activities detailing their sequence of execution. Budget Planning: This specifies the budgeted cost to be incurred in the completion of the Project.
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Project Initiation Phase defines a few facilitating processes as well that are required for successful Project Completion. These can be: Procurement Planning: Planning for procurement of all resources (staff and non-staff). Communication Planning: Planning on the communication strategy with all project stakeholders. Quality Planning: Planning for Quality Assurance to be applied to the Project. Risk Management Planning: Charting the risks, contingency plan and mitigation strategies. Configuration Management Planning: Defines how the various project artifacts will get stored. Both the basic processes and facilitating processes produces a Project Plan.
1.1.4 Closure
In this last stage, the project manager must ensure that the project is brought to its proper completion. The closure phase is characterized by a written formal project review report containing the following components: a formal acceptance of the final product by the client, Weighted Critical Measurements (matching the initial requirements specified by the client with the final delivered product), rewarding the team, a list of lessons learned, releasing project resources, and a formal project closure notification to higher management. No special tool or methodology is needed during the closure phase.
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Project Idea
Administrative approval
Preparation of DPR
Implementation of project
Technical Sanctioning
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Each activity or event on the schedule should have a responsible individual assigned, so there is clear ownership and so schedule status can be updated without a lot of argument. Here one should know meaning for two words activity and event. Activity- An activity is a part of the project denoted by an arrow on the network. The tail of the arrow indicates the start of the activity whereas the head indicates the end of the activity. Event Event is the stage or point where all previous jobs merging in it, are completed and jobs bursting out, are still to be completed.
B
e.g.
C D
Here 1 and 2 denotes the event form where the activities A, B, C, D can merge of burst out Scheduling process needs duration of the activity. Table 1.1: Activities for a project with duration No. 1 2 3 4 5 6 7 8 Activity Project idea / kickoff meeting Pre feasibility study of the project Administrative approval of the project Preparation of the DPR Sanctioning the DPR Implementation of the project Overview of the project progress Sending the completion report of the project Duration (day) 07 30 15 35 15 180 25 07
But for scheduling these tasks each should have start date and completion date. So, all the duration of above activities should be specified by start date and end date presented in table 1.2. Table 1.2: Activities for a project with time schedule No 1 2 3 4 5 6 7 Activity Project idea / kickoff meeting Pre feasibility study of the project Administrative approval of the project Preparation of the DPR Sanctioning the DPR Implementation of the project Review of the project progress Duration (Day) 07 30 15 35 15 180 35 Start Date 1-1-07 8-1-07 7-2-07 23-2-07 31-3-07 15-4-07 22-4-07 22-5-07 22-6-07 22-7-07 22-8-07 22-9-07 15-10-07 Completion Date 7-1-07 6-2-07 22-2-07 30-3-07 14-4-07 14-10-07 26-10-07 26-5-07 26-6-07 26-7-07 26-8-07 26-9-07 20-10-07
07
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These activities can be explained by bar chart also and presented in table 1.3. Table 1.3: Bar Chart of a project progress
N o Activity Jan 07 1 7 Project idea / Pre feasibility Administrative Preparation of Sanctioning Implementation Review of the Sending the 8 5 Feb 07 6 7 2 1 1 2 3 4 5 6 7 8 2 2 2 3 March 07 2 9 3 0 3 1 April 07 1 3 1 4 1 5 1 3 1 4 Oct. 07 1 5 1 9 2 0
In any government organization the progress of the project is being explained be the bar chart. Above shown bar chart has been drawn manually. One can use software like Microsoft Project to draw the bar chart which is very easy to use.
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Level-1 Level-2
Project Idea Feasibility study Administrative approval Preparation of DPR
Project
Sanctioning DPR
Implementation of DPR
Review
Completion
Level -3
Project Idea Kickoff meeting Circulate minutes of meeting Discussion meet Decision Feasibility study Reconnaissance and traffic Estimate Preliminary design Administrative approval Collection of feasibility report and other data Forwarding the file Preparation of DPR Detailed topographical survey Detailed Soil Investigation Sanctioning DPR Study &Scrutiny Discussion with the Institute Compliance Decision Land acquisition If Yes Implementation of DPR Bidding procedure Evaluation tender of Review Quality control by third party Progress report preparation Review Meeting Completion Physical checking of completed work Cooperation stipulated time limit against actual completion time Arbitrations Completions Report
Socioeconomic survey Primary Survey Secondary Survey Detailed Engineering design Cost-estimation Compilation of Report
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Taking a case of Rajkot DPR, individual component of the WBS can be explained as in table 1.4 below. Table 1.4: Detailed Activity Schedule of Water Supply Project
Sr. No. 1 2 3 4 5 6 7 8 9 Sanction Date & Name of Project Tentative Completion Time ESR & GSR at ward No.6 ESR & GSR at ward No.7 ESR & GSR at ward No.17 New Head works at Raiyadhar Water supply scheme based on Nyari reservoir Water supply scheme based on Bhadar reservoir GSR at Sojitra ward -12 GSR & Pumping machinery at Bajarangwadi at ward no.14 GSR & Rising main at Dudhsagar 27 /03/2006 & Dec. 2006 27 /03/2006 & Dec. 2006 27 /03/2006 & Dec. 2006 27 /03/2006 & Dec. 2008 27 /03/2006 & Sep. 2006 27 /03/2006 & July 2007 27 /03/2006 & April 2006 27 /03/2006 & Sept. 2006 27 /03/2006 & June 2006 Sanctioned Cost (Rs. in Crore) 6.75 4.31 8.44 31.20 7.41 24.70 0.16 0.90 1.64
Scheduling for all these projects can be explained by bar chart also which is shown below in table 1.5.
Table 1.5: Scheduling for Water Supply Project
Details
Q 1
2005 Q 2 Q 3 Q Q 4 1
2006 Q 2 Q 3 Q 4 Q 1
2007 Q 2 Q 3 Q 4 Q 1
2008 Q 2 Q 3 Q 4
ESR & GSR at ward No.7 ESR & GSR at ward No.17
Completed
New Head works at Raiyadhar Water supply scheme based on Nyari reservoir Water based supply on scheme Bhadar
Completed GSR & Pumping machinery at Bajarangwadi at ward No.14 Completed
Complete
Completed
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Above diagram represents a project with three activities A, B, C Activity B can start after activity A is completed Activity C can start after activity B is completed
Finish Node
b)
1 A 4 D 5 F 6
Starting Node
B 2
THIS IS WRONG
B
1) In above case an extra activity (known as Dummy Activity) is added to correct the network
3 C
B 2
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2) An Event is said to be completed when all activities ending at that event are completed
0 1
10 A 8 4 B 6 2 3 D 10 C 4
20
Total project time is 20 Event (2) will be completed after 6 days, event (3) will be completed after 10 days (Refer rule no 6 of network) & event no (4) will be completed after 20 days.
Di,j
Ej
Total float of Activity i, j = Lj Ei - Di,j Free Float of Activity i, j = Ej - Ei Di,j Interfering Float of i, j = Total Float Free Float = Lj Ej Ei = Early Start Time from Event i Li = Late Finish Time of Event i Ej = Early Start Time from Event j Lj = Late Finish Time of Event j Di,j = Duration of Activity i, j
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1 0 0
A 8 10
3 10
D 10 20
4 20
4 6 B 2 6
Note: At event (3) activities A & C will end. Activity A will be completed after 8 days & activity C will be completed after 10 days & hence as per rule 6 of network 10 is entered as finish time of event (3) Project time is 20 days. Above process is called forward pass of AOA network Now we will take 20 as the latest finish time of event 4, and calculate latest finish time of other events For example latest finish of event (3) = 20 {Lj of Event (4)} 10 {Duration of Activity D} = 10 Float Calculations (Refer Formula) Total Float of A = 10-8-0 = 2 Free Float of A = 10-8-0 = 2 Other Floats are tabulated below: Activity A B C D Total Float 2 0 0 0 Free Float 2 0 0 0 Interfering Float 0 0 0 0
Critical Activity: When total Float of activity is zero, the activity is critical. Non- Critical Activity: When the total float of an activity is greater than zero, the activity is non-critical. Path joining Critical activities is called Critical Path There can be more than one Critical Path in a project Delay in Critical activities will delay the project Floats when utilized, do not delay the project
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B 1 0 0 C
4 A 0 3 8
4
16 16
G 10
26
8
26
16
26
K J 7
23
6
11
12
15
Table 2.1: Float Example ID 1 2 3 4 5 6 7 8 9 10 Name A B C D E F G H J K Duration 8 4 3 7 5 9 10 6 12 3 Total Float 8 0 8 0 0 0 0 0 8 8 Free Float 8 0 0 0 0 0 0 0 0 8 Intefering Float 0 0 8 0 0 0 0 0 8 0
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Cumulative cost for Early Start schedule and Late Start schedule. Cost per day is assumed to be 10 units of currency. Days 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Activity /Day Early Late 3 1 3 1 3 1 3 1 3 1 3 1 3 1 3 1 2 3 2 3 2 3 3 4 3 4 3 4 3 4 3 4 3 3 3 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 Cumulative Cost Early Start Late Start 30 10 60 20 90 30 120 40 150 50 180 60 210 70 240 80 260 110 280 140 300 170 330 210 360 250 390 290 420 330 450 370 480 400 510 430 530 460 550 490 570 520 590 55 610 580 630 610 650 640 670 670
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A
lage after finish of A (2) Start to Start
n Lag
Activity B can start after n days (units) from finish of activity A. n is called the
Activity B starts n days (units) after start of activity A (3) Finish to Finish
Activity B must finish n days ( units ) after the finish of activity A (4) Start to Finish
Activity b must finish n days (units) after the start of the activity A
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PDM NETwork
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Over allocation is one type of resource conflict. If certain resource is over allocated, the project manager can change the schedule to remove resource over allocation. If a certain resource is under allocated the project manager can change the schedule to try to improve the use of the resources. Resource levelling, therefore, aims to minimize period by period variations in resource loading by shifting tasks within their slack allowances.
Before Levelling
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After Levelling
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incentive cost to the community seen small to users.In another example, in a partnering continuous improvement arrangement, the joint effort of the owner and contractor resulted in early completion of a river lock and a 50/50 split of the savings to the owner and contractor. Another reason for reducing project time occurs when unforeseen delays for example, adverse wheather design flaws and equipment breakdown a cause substantial delays midway in the project. Getting back on schedule usually requires compressing the time on some of the remaining critical activities the additional costs of getting back on schedule need to be complied with the cost of being late. Sometimes very high overhead or good will costs are recognized before the project begins. In these cases it is prudent to examine direct costs of shortening the critical path versus the overhead end /or goodwill cost savings.usually there area opportunities to shorten a few critical activites at less than the daily overhead rate or perceived goodwill cost.under specific conditions (which are not rare) , huge saving are possible with little risk. Managers have several effective methods for crashing specific projects activities when resources are not constrained. Several of these are summarized below :
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Overtime has disadvantages. First, hourly workers are typically paid time and a half for overtime and double time for weekends and holidays. Sustained overtime work by salaried employees may incur intangible costs such as divorce,and turnover.
Terminology: NT = Normal Time (duration) of Activity NC = Crash Time (duration) of Activity CT = Cost of Activity at NT CC = Cost of activity at Nc
Cost Slope = Tan = CC- NC/ NT-CT In order to curtail the duration of the activity, cost slope values have to be viewed carefully. Least cost slope activity must be curtailed first and so on If more than one critical path is generated after Crashing then duration of activities on all paths have to be curtailed. The following example will explain the technique of Crashing. Activity A B C D Normal Duration 3 7 4 5 Crash Duration 1 3 2 2 Predecessor A A c Cost Slope 500 100 400 200
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Normal cost of project = Rs. 10,000 Cost of overheads per day = Rs. 200/day OH Cost = 12 X 200 = Rs. 2400/Total cost = Normal cost + OH Cost = Rs. 10,000 + Rs. 2,400 = Rs. 12,400 (Before crashing) Normal Time:
Step (1) Since D has lease cost slope, it will be crashed by 2 days Cost of crashing = 2 X 200 = 400 Reduction of OH = 2 X 200 = 400 Hence there will be no extra cost if the project time is reduced to 10 days
Step (2)
Now there are two critical paths viz: A B & A C- D To curtail one day the options are Crash Crash Crash A B+C B+D 500 500 300
Last option is least expensive so B & D will be curtailed by one day each Extra cost of crashing = 100 (B) + 200 (D) = 300 Saving in O.H. = 1 X 200 = 200 Hence the project cost will increase by Rs. 100/-
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Step (3)
Since D is fully crashed last option cant be used. Hence A is the least expensive option. Crash A by 2 days Extra cost of crashing = 2 X 500 = 1000 Saving in O.H. = 2 X 200 = 400
Therefore, Net extra Cost = Rs. 600/Step (4) At this stage: A is fully crashed D is fully crashed B is crashed by 1 day (can be crashed by 3 days) C not crashed (can be crashed by 2 days) The only option left for crashing is B + C Activities B & C will be curtailed by 2 days Extra cost of crashing = 2 X 500 = 1000 Saving in O.H. Net Extra Cost = 2 X 200 = 400 = Rs. 600/-
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At the end of 18th day 400 meter are installed. Actual cost at the end of 18th day BCWS BCWP Scheduled Variance Cost Variance CPI SPI Estimated Time to Complete = 100,000 (ACWP) = 18 X 5,000 = 90,000 = 400 X 200 = 80,000 = BCWP BCWS = 80,000-90,000 = -10,000 = BCWP ACWP = 80,000-100,000 = -20,000 = BCWP/ACWP = 80,000/100,000 = 0.8 (approx.) = BCWP/BCWS = 80,000/90,000 = 0.9 (approx.) = 40/0.90 = 44.4 say 45 days
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Example 2: Activity ID 1 2 3 4 5 6 7 8 9 10 11 12 Example 3: Activity D E F G H I J K L M a) Find the project duration b) Draw revised network if activities H & K require equipment X and only one equipment is available. Also calculate project duration for alternate networks. Example 4: In the given project only three resources are available. Reschedule the project by resource leveling. Activity A B C D E F G Duration 1 2 2 1 3 2 1 Predecessor A B C D Resources 2 1 1 1 1 1 1 Duration 3 8 10 2 6 3 3 4 6 2 Successor E,G,J F M H I M K L M Activity Description A B C D E F G H J K L M Predecessors B A B A A D C J K F Duration 1 2 3 5 2 4 3 2 6 3 2 5
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To insert new columns of: Free clack Total slack Right Click on Predecessor Column Insert Column
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Formatting the Bar Chart Viewing name of activity on the bar Viewing Total Slack in the Bar Chart Steps Format Bar Format Bar Window appears Insert the Field to be displayed from the drop down of Resource name
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Steps:
Project Statistics Project Information
Viewing the Detailed Grantt Charts Steps View- More Views Select Detail Gantt Chart Apply
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This chart shows the critical paths of the project and the floats available in the activities To View only the Critical Path
Steps:
Project for:Critical Critical Filter
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Customizing the Calendar Steps: Tools Change Working Time This gives default calendar For a new calendar new Supply the name Select create a new base calendar
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Giving working & Non-working days Steps: Select the dates select default working or non-working time respective to what is required
Inserting Column fields not in the default list Insert Column Field Name Text Right click on column Customize Fields Rename the Column Supply the value list of the column
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Sheet after inserting values Insert the respective values from the value drop down list
To Filter on Phase wise Project Filet for more filters new supply values in the field name, test and values
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Grouping the Activities Project Group By More Groups New Supply the respective values
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ACTIVITY ENTRY
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RESOURCE GRAPH
BAR CHART
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BAR FORMATING
REPORT GENERATION
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In todays world, the bid process management has emerged as one of the main activities of project management and adequate importance is attached while scheduling of the project itself. Due to rapid increase in the project complexities, a delivery partner can be sought right at the beginning or at any stages of project. Based on the involvement a project partner may be classified as under: Owners Consultants Programme / Process / Project Management Activity Consultants Piece-meal Constructions EPC/Turnkey BOT/BOOT/BOO etc