Project Management Professional PMP Memo No (973

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Projects Cost Management
‫ادارة التكاليف للمشروعات بأستخدام الحاسب‬
by
Dr. Abdalla El Daoushy March, 2009 Jan, 2010
(Computer Software Oriented)

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Index
Page

Theoretical Part
Projects Cost Management . . . . . 5 1. Project’s Resources Planning . . . . 13 1.1 Inputs to Project’s Resource Planning . . 15 1.2 Tools & Techniques for Project’s Resource Planning 17 1.2.1 Applying Expert Judgment . . . 1.2.2 Identifying Alternative Solutions . . 1.2.3 Relying on Project Management Software . 1.3 Outputs of Project’s Resource Planning . . 1.3.1 Identifying Resource Requirements . . . . . . . . . . . . . . . . . 26 . . . . . . . . . . . . . . . . . . . 17 18 18 19 19 . . 22 22 22 24 26 27 27 . 28 28 30 30 . 31 31 32 32 32 .

2. Project’s Cost Estimating . . . . . 20 2.1 Inputs to Project’s Cost Estimating . . 20 2.1.1 Using Work Breakdown Structure . . 2.1.2 Relying on the Resource Requirements . 2.1.3 Calculating Resource Rates . . . 2.1.4 Estimating Activity Duration . . . 2.1.5 Using Estimating Publications . . . 2.1.6 Using Historical Information . . . 2.1.7 Referencing the Chart of Accounts . . 2.1.8 Acknowledging the Cost of Risk . . 2.2 Tools & Techniques for Project’s Cost Estimating 28 2.2.1 Using Analogous Estimating . . . 2.2.2 Using Parametric Modeling . . . 2.2.3 Using Bottom-Up Estimating . . . 2.2.4 Using Computer Software . . . 2.3 Outputs of Project’s Cost Estimating . . 31 2.3.1 Estimating Project Costs . . . 2.3.2 Analyzing Cost Estimating Results . . 2.3.3 Refining the Cost Estimates . . . 2.3.4 Considering the Supporting Detail . . 2.3.5 Developing the Cost Management Plan . 3. Completing Project’s Cost Budgeting 33 . . .

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3.1 Inputs to Project’s Cost Budgeting . . 34 3.1.1 Cost Estimates . . . . . 3.1.2 Work breakdown Structure . . . 3.1.3 Project Schedule . . . . . 3.1.4 Risk management Plan . . . . 3.2 Tools & Techniques of Project’s Cost Budgeting 35 3.2.1 Analogous Budgeting . . . 35 3.2.2 Parametric Modeling . . . . 3.2.3 Bottom-Up Budgeting . . . . 3.3.4 Computerized Tools . . . . 3.3 Outputs of Project’s Cost Budgeting . . 36 3.3.1 Creating the Cost Baseline . . . 4. Implementing Project’s Cost Control . . . 37 4.1 Inputs to Project’s Cost Control . . . 4.1.1 Cost Baseline . . . . . 4.1.2 Performance Reports . . . . 4.1.3 Change Requests . . . . . 4.1.4 Cost Management Plan . . . . 4.2 Tools & Techniques of Project’s Cost Control . 39 4.2.1 Creating a Cost Change Control System . 4.2.2 Measuring Project Performance . . 4.2.3 Planned Value (PV) . . . . 4.2.4 Earned Value (EV). . . . . 4.2.5 Actual Cost (AC) . . . . . 4.2.6 Additional Planning . . . . 4.2.7 Using Computers . . . . . 4.3 Outputs of Project’s Cost Control --- Cost Control . 43 4.3.1 Revising the Cost Estimates . . . 4.3.2 Updating the Budget . . . . 4.3.3 Applying Corrective Actions . . . 4.3.4 Preparing for the Estimate at Completion . 4.3.5 Calculating the Cost Performance Index (CPI) 4.3.6 Calculating Estimate at Completion (EAC). 48 4.3.7 Experiencing Expected Condition . 4.3.8 Accounting for Flawed Estimates . 4.3.9 Accounting for Anomalies . . . 4.3.10 Accounting for Permanent Variances . 4.3.11 Closing Out the Project . . . 4.3.12 Updating Lessons Learned . . .

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. 34 34 . . 35 35 35 .

. 36 Page . . . . . 38 38 38 38 38 . . 39 . 40 . 41 41 41 . 41 42 Results . . . . . . . . . . . 43 44 45 45 45 . 48 49 50 51 52 52

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Summary

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Key Terms . Self Test .

Practical Part
Scenario 1: . . . .  Defining Roles, Resources, &  Assigning Roles . .  Assigning Resources & Costs  Analyzing Resources . Scenario 2: . . . .  Optimizing the Project Plan  Baselining . . .  Project Execution & Control Scenario 3: . . . .  Reporting Performance . . Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page . 69 . 70 71 72 . 73 . . 76 77 . 79 . . 74 75

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Workshop (Case Study): Building 2nd Floor of a Villa 80 References 106 . . . . . . .

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Theoretical Part

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Projects Cost Management Planning
2 2 Cost Cost Estimating Estimating

Execution & Controlling (Updating)
4 4 Cost Cost Controlling Controlling

1 1 Resource Resource Planning Planning

3 3 Cost Cost Budgeting Budgeting

Cost Estimating is the process of calculating the Costs of Resources needed to complete the Project Work. Cost Budgeting is the process of assigning a cost to an individual work package.

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Projects Cost Management:

Most likely there is more negotiating, questioning, and evaluating for larger Projects than for smaller ones. The relation between the Project’s Cost and the Project’s Scope should be direct: you get what you pay for. A successful Project Manager must be able to plan, predict, budget, and control the costs of a Project. Costs associated with Projects are not just the costs of goods procured to complete the Project. The cost of Labor may be one of the biggest expenses of a Project.

The Project Manager must rely on time estimates to predict the cost of the labor to complete the Project Work.

In addition, the Cost of Equipments and Materials needed to complete the Project Work must be considered into the Project’s Expenses.

In brief:

Projects Cost Management Processes:
1. Resource Planning
1.1

Inputs to Resource Planning
1.1.1 WBS 1.1.2 Historical Information 1.1.3 Scope Statement 1.1.4 Resource Pool Description 1.1.5 Organizational Policies 1.1.6 Activities Duration Estimates

1.2

Tools & Techniques of Resource Planning
1.2.1 Expert Judgment 1.2.2 Alternatives Identification 1.2.3 Project Management Software

1.3

Outputs of Resource Planning 1.3.1 Resource Requirements

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Hint: Refer to “Scenario1” of “Practical Part”

2. Cost Estimating
2.1

Inputs to Cost Estimating
2.1.1 Using WBS & RBS 2.1.2 Relying on Resource Requirements (output of previous process) 2.1.3 Calculating Resource Rates 2.1.4 Activities Duration Estimates 2.1.5 Using Cost Estimating Publications 2.1.6 Using Historical Information 2.1.7 Referencing the Chart of Accounts (Chart of Accounts: A Coding System used by Performing Organization’s Accounting System to account for the Project Work) 2.1.8 Acknowledging the Cost Risk

2.2

Tools & Techniques for Cost Estimating
2.2.1 Using Analogous Estimating 2.2.2 Using Parametric Modeling 2.2.3 Using Bottom-Up Estimating 2.2.4 Using Computerized Tools

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2.3

Outputs of Cost Estimating
2.3.1 Estimating Project Costs 2.3.2 Analyzing Cost Estimating Results 2.3.3 Refining the Cost Estimates 2.3.4 Considering the Supporting Detail (Supporting Detail: Any Information that supports Decisions, including the Project Plan as a whole. Supporting Detail can include Books, Articles, Web Sites, Vendor Information, Results of Testing, Historical Information, and many others Information Sources.) 2.3.5 Developing the Cost Management Plan

Hint: Refer to “Scenario1” of “Practical Part”

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3. Completing Cost Budgeting
3.1

Inputs to Cost Budgeting
3.1.1

Cost Estimates (from previous process)

3.1.2 WBS 3.1.3 Project Schedule 3.1.4 Risk Management Plan

3.2

Tools & Techniques of Cost Budgeting
3.2.1 Analogous Budgeting 3.2.2 Parametric Modeling 3.2.3 Bottom-Up Budgeting 3.2.4 Computerized Tools

3.3

Outputs of Cost Budgeting
3.3.1

Creating the Cost Baseline

Hint: Refer to “Scenario2” of “Practical Part”

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4.

Implementing Cost Control
4.1

Inputs to Cost Control
4.1.1 Cost Baseline (from previous process) 4.1.2 Performance Reports 4.1.3 Change Requests 4.1.4 Cost Management Plan (from process 2)

4.2

Tools & Techniques of Cost Control
4.2.1 Creating a Cost Change Control System 4.2.2 Measuring Project Performance 4.2.3 Earned Value Management (EVM) 4.2.3.1 4.2.3.2 4.2.3.3 Planned Value (PV) Earned Value (EV) Actual Value (AV)

4.2.4 Additional Planning 4.2.5 Computerized Tools

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4.3

Outputs of Cost Control --- Cost Control Results
4.3.1 Revising the Cost Estimates 4.3.2 Updating the Budget 4.3.3 Applying Corrective Actions 4.3.4 Preparing for the Estimate at Completion 4.3.5 Calculating the Cost Performance Index(CPI) 4.3.6 Calculating Estimate At Completion (EAC) 4.3.7 Accounting for Anomalies 4.3.8 Accounting for Variances 4.3.9 Project Closeout 4.3.10 Updating Lessons Learned

Hint: Refer to “Scenario2” of “Practical Part”

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In details,

Project’s Resources Planning:

As part of the Planning Process, the Project Manager must determine what Resources are needed to complete the Project. Resources include Labor (people), Nonlabor (Equipments), and Materials that will be utilized to complete the Project. In addition, the Project Manager must identify how many & when of the Resources are needed for the Project. The Identification of Resources, the Needed Quantity, and the Schedule of Resources are directly linked to the expected cost of the Project as shown:

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Example: Automate a “New Home” Project:
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The Lights, Air-Conditioning, Electrical Devices, and Home Security are all connected through a Central Computer Operating System. The Resources to complete the Project Work would include Technicians, HVAC Experts, Electricians, and other People with the knowledge to install and configure the components. The Resources in this case, however, would also include the Network Cabling to connect the components, Diagnostic Tools to monitor and test the installation, and the Equipments & Tools to physically install the components. In addition, Services are considered Resources as well. Your Project may require a Vendor's Service, such as a Printer, a Carpenter, or Other Service. If these services are not available for the Project as planned, the Project will suffer from delaying. Some Projects require you to lease space; the Leased Space is considered a Resource. In some instances, it is most cost effective to hire a Consultant or Subject Matter Expert (SME) to identify details unique to the Project Work, such as permissions, laws, and so on. The expense of relying on the SME may be far less than the cost of the time to research the unique details and requirements of the Project. The knowledge gained from the SME can balance the expenses that would otherwise result from not having specialized knowledge of the Project Work.

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Exam

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1.1

Inputs to Project’s Resource Planning

Resource Planning is the process of examining the Project Work and determining what Resources (People, Equipments, and Materials) are needed to complete the Project. Resource Planning also includes identifying the expected quantity of each Resource so the Predicted Cost can be calculated. The following are some familiar Inputs to Resource Planning: Work & Resource Breakdown Structure: The WBS & RBS help the Project Manager and the Project Team identifies the components requiring specific People, Equipments, and Materials. Historical Information: Historical Information should be used if it is available, as it is Proven Information. Project Scope: The scope statement serves as a key input to Resource Planning since the Scope Statement defines the Project Work. The required work, therefore, can help identify the Required Resources to Complete the Project. Resource Pool Description:
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 1.1.1

1.1.2

1.1.3

1.1.4

The Project Manager should identify the availability of Resources for the Project (People, Materials, and Equipments).

1.1.5

Performing Organization's Policies:
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The Performing Organization's Policies regarding Staff Achievements must be taken into consideration. In addition, any Procurement Policies to ascertain (determine) lease or rent equipment must be evaluated.

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The Project Manager should be aware of these requirements before Resources Planning.

1.1.6

Time invested identifying Resources may be lost if the process conflicts with the Organizational Policies. Activities Duration Estimates:
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The duration of the Project’s Activities are needed so the Project Manager and the Project Team can consider the Resources & Costs and therefore the benefits of assigning more effort to reduce Activities’ Duration where feasible. The Activities Duration Estimates should be readily available from the “Time Management Processes”.

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1.2 Tools & Techniques for Project’s Resource Planning
1.2.1 Applying Expert Judgment

Preparing the Inputs to Resource Planning, the Project Manager and the Project Team should be ready to identify and plan the need for the Project Resources. The Project Manager and Project Team will examine the Project Work and Resources Availability and then apply reason, logic, and experience in evaluating the Available Resources in relation to the Project’s Requirements. A Person or Group can offer Expert Judgment on the Project Resource Needs. The Person or Group offering the Expert Judgment should have the expertise, experience, or training needed to evaluate and analyze the Resources that the Project needs.

Expert Judgment can come from several Sources:
Internal Subject Matter Experts (SME), such as Resources from other Departments

External Subject Matter Experts (SME), such as Consultants

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Trade and Professional Associations Industry Groups
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1.2.2 Identifying Alternative Solutions

Alternatives-Identification is any process that identifies other solutions to an Identified Problem. These Approaches typically use brainstorming and imaginative thinking. In this process, AlternativesIdentification may include Buy-versus-Build Scenarios, Outsourcing, Cross Training, and Other Activities. The idea of using Alternatives-Identification is to ensure that the Identified Resources are complete and that the Cost of Resources is the best fit for the Project Work. Value Analysis is an Approach to find more affordable (reasonable) and less costly Methods of accomplishing the same work. For example, a Project Manager may change Activities-Sequencing to shorten the Project’s Duration, while saving Labor Costs by assigning high-cost Resources only to the Activities that demand them.

1.2.3 Relying on Project Management Software
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Project Management Software can assist in Resource Panning. Project Management Software can help the Project Manager identify and organize the Resources Pool. Project Management Software can be configured to organize Common Resources, Talents, Skill Sets, Resources Calendars, Rates, Contract Information, and more.

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1.3 Outputs of Project’s Resource Planning
1.3.1 

Identifying Resource Requirements: Once the Project Manager and Project Team have completed Resource Planning, the required Resources to complete the Project will have been identified. The Resource Identification is specific to the lowest level of the WBS (i.e., Project Activities).

The Identified-Resources will need to be obtained through StaffAcquisition or through Procurement. Resource Planning identifies all of the Required-Resources.

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Project’s Cost Estimating

Cost Estimating is the process of calculating the Costs of Resources needed to complete the Project Work. The Person or Group doing the Cost Estimating must consider the possible fluctuations, inflation, conditions, and other causes of Variances that could affect the total Cost Estimating. Cost Estimating and Pricing: There is a difference between Cost Estimating and Pricing. A Cost Estimate is the cost of Resources required to complete the Project Work.
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Pricing, however, includes a profit margin. In other words, a Company performing Projects for other Organizations may do a cost estimate to see how much the Project is going to cost to complete. Then, with this Cost Information, they will factor a profit into the Project Work, as shown:
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The costs for Scheduled Activities are:
o Labor (People) o NonLabor (Equipments) o Materials o Expenses:

Services

 Facilities  Inflation Allowance  Contingency (emergency) Cost

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2.1

Inputs to Project’s Cost Estimating

Cost Estimating relies on Historical Information and Policies from the Performing Organization.

2.1.1 Using the Work Breakdown Structure:
Of course, the WBS is included. It is an input to five major Planning Processes: 1- Activity Definition, 2- Resource Planning, 3- Cost Estimating, 4- Cost Budgeting, and 5- Risk Management Planning.

2.1.2

Relying on Resource Requirements:
The output of Resource Planning serves as a key input to Cost Estimating. The Project will have some Resources Requirement. The Skills of the Labor, the Availability of Materials, or the Function of Equipments, must all be accounted for Cost Estimating.

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2.1.3 Calculating Resource Rates:
The Estimator has to know how much each Resource costs. The Cost should be in some Unit of Time or Unit of Measure --such as: $/hr, $/ton, $/lf (long feet), or $/use.

There are four Categories of Cost: Direct Costs: These costs are accredited directly to the Project Work and cannot be shared among Projects (airfare, hotels, long distance phone charges, and so on). Indirect Costs: These costs are representative of more than one Project (Utilities-of-PerformingOrganization, Access-to-Training-Room, ProjectManagement-Software-License, and so on). Variable Costs: These costs vary depending on the conditions applied in the Project (number of Meetings for Participants, Supply and Demand of Materials, and so on). Fixed Costs: These costs remain constant throughout the Project (the Cost-of-RentedEquipment for the Project, the Cost-of-Consultant brought onto the Project, and so on).

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2.1.4 Estimating Activity Durations:

Activities’ Durations Estimating (which predicts the length of the Project as a whole) are needed for decisions on Project’s Financing. Recall the formula for Present Value. It is:

FV= PV * (1+R)n
; PV FV R n is the present value, is the future value, is the interest rate, and is the number of time periods.

The Future Value of the Money the Project will earn may need to be measured against the Present Value to determine if the Project is worth financing, as shown here:

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Determining of the Activities’ Durations are needed in order to estimate the Total Cost of the Project. For example, if an Activity is estimated to last 14 hours and Suzanne’s Cost is $80/h, then the Cost of this Activity will be $1,120. The Duration shows Management how long the Project is expected to last and which Activities will cost the most and provides the opportunity to re-sequence Activities to shorten the Project’s Duration---which consequently shortens the finance period for the Project. There are three Approaches to estimate the Product’s Cost: Straight-Line Depreciation: allows the Organization to write off the same amount each year. The formula for straight-line depreciation is:

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Yearly Deduction = (Purchase Value - Salvage Value) / Number of Years in Use. ‫الخص مم )تكلف مة الهلك( الس منوي = )س معر الش مراء - قيم مة‬ ‫م‬ ‫م‬ ‫م‬ ‫م‬ ‫م‬ ‫م‬ ‫الخردة ( ÷ العمر النتاجي للصل‬ See Question no 19 page 65……

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For example, if the purchase price of a photocopier is $7,000 and the salvage value of the photocopier in five years is $2,000, the formula would read: Yearly Deduction = (7,000 - 2,000)/5 = $1,000
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Double-Declining Balance: is considered accelerated depreciation. This method allows the organization to double the percentage written off in the first year.

In our preceding example, a single deduction was $1,000 per year, which is 20% of the total deduction across the five years. With double-declining, the customer would subtract 40% the first year, and then 40% of the remaining value each subsequent year. In our example, the deducted amount for year one would be $2,000. For year two, it would be $1,200, and year three it would be $720. This is a great method for Equipment that you don’t anticipate to have around for a very long time---such as Computer Equipment.
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Sum of the Year’s Depreciation is like a magic trick. It works by writing out the number of years the equipment is in production and adding each year to the year before.

In our example: it was five years, so we do this: 5+4+3+2+1=15 (note the largest to smallest). The sum of the years (15) becomes our denominator; the five, for the first year, is our numerator. So for the first year, we’d deduct 5/15 (or one third) of the Photocopier Cost after the Salvage Amount, which would be $1,650. The second year, the four would be the numerator and we deduct $1,250, and so on. Each year we’d deduct a slightly smaller percentage than the year before.
2.1.5 

Using Cost Estimating Publications:
There are (for different Industries) Commercial Cost Estimating Publications. These references can help the Project Estimator confirm

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and predict the accuracy of estimates. If a Project Manager elects to use one of these Commercial Databases, the Cost Estimate should include a pointer to this document for future reference and verification.

2.1.6 Using Historical Information:

Historical Information is Proven Information and can come from several places: Project Files: Past Projects within the Performing Organization can be used as a reference to predict Costs and Time. Caution must be taken that the records referenced are accurate, somewhat current, and reflective of what was actually experienced in the Historical Project.

Commercial Cost-Estimating Database: These databases provide estimates of what the Project should cost based on the variables of the Project, Resources, and other Conditions.

Team Member’s Knowledge: Team Members may have specific experience with the Project Cost Estimate. Recollections may be useful, but are highly unreliable when compared to documented results.

Lessons Learned: Lessons Learned could include Cost Estimates obtained from previous Projects that are similar in Scope and Size. Exam Watch

2.1.7 Referencing the Chart of Accounts:
This is a Coding System used by the Performing Organization’s Accounting System to account for the Project Work. Estimates within the Project must be mapped to the correct code of accounts so that the Organization’s Ledger reflects the Actual Work Performed, the Cost of the Work Performed, and any billing (internal or external) that was charged to the Customer for the Completed Work.

2.1.8 Acknowledging the Cost of Risk:

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The impact of Risks, for positive or negative effect, must be evaluated and considered in the Cost Estimates.

2.2

Tools & Techniques for Project’s Cost Estimating

2.2.1 Using Similar Estimating:

Similar Estimating relies on Historical Information to predict the Cost of the current Project. It is also known as Top-Down Estimating. The process of Similar Estimating takes the Actual Cost of a Historical Project as a basis for the current Project. The Cost of the Historical Project is applied to the Cost of the Current Project, taking into account the Scope and Size of the Current Project as well as other known Variables. Similar Estimating is a form of Expert Judgment. This Estimating Approach takes less time to complete than other Estimating Models, but is also less accurate. This Top-Down Approach is good for fast estimates to get a general idea of what the Project may cost. Example of Similar Estimating:

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The “Carlton Park Project” was to grade and pave a sidewalk around a Swimming Pool in the Community-Park. The sidewalk of Carlton Park was 1,048 feet by 6 feet, and cost $25,287 to complete. The current Project, “King Park Project”, will have a similar surface and will cover 4,500 feet by 6 feet. The Analogous Estimate for this Project, based on the work in Carlton-Park, is $108,500. This is based on the price/foot of Material at $4.02.

2.2.2 Using Parametric Modeling:

Parametric Modeling uses a Mathematical Model based on known parameters to predict the Cost of a Project. The parameters in the Model can vary based on the type of work being completed. A parameter can be cost/long foot, cost/cubic yard, cost/unit, and so on. A complex parameter can be cost per unit with adjustment factors based on the conditions of the Project. In addition, the adjustment factors may have additional modifying factors depending on additional conditions. To use Parametric Modeling, the factors the model is based on must be accurate. The factors within the Model are quantifiable and do not vary much based on the effort applied to the Activity. And finally, the Model must be scalable between Project-Sizes. The Parametric Model using a scalable Cost/Unit Approach is depicted here:

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There are two types of Parametric Cost Estimating: 1. Regression Analysis:
This is a Statistical Approach to predict what Future Values may be based on Historical Values.

2. Learning Curve:
This Approach is simple. The cost/unit decreases the more units Workers complete; this is because Workers learn as they complete the required Work. The more an Individual completes an Activity, the easier it is to complete. The estimate is considered parametric, as the formula is based on repetitive Activities such as wiring Telephone-Jacks, Painting-Hotel-Rooms, or other Activities that are completed over and over within a Project. The cost/unit decreases as the experience increases because the time to complete the Work is shortened.

2.2.3

Using Bottom-Up Cost Estimating:
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Bottom-Up Estimating starts from zero, accounts for each component of the WBS, and arrives at a sum for the Project. It is completed with the Project Team and can be one of the most time-consuming Methods to predict Project Costs. While this method is more expensive (because of the time invested to create the estimate) it is also one of the most accurate.
Exam Watch

2.2.4 Using Computer Software:

Computer Software can assist the Project Manager. There are several different Computer Programs that can make Accurate Estimates for the Project Work.

2.3

Output of Project’s Cost Estimating

2.3.1 Estimating Project Costs:

Management, Customers, and other interested Stakeholders are all going to be interested in what the Project is going to cost to complete. The Estimates are reflective of the Accuracy of the Information the Estimate is based upon. The more Accurate the Information, the better the Cost Estimate will be.

2.3.2 Analyzing Cost Estimating Results:

The output of Cost Estimating is the Cost Estimates of the Resources required to the complete the Project Work. The Estimate is typically quantitative and can be presented in detail against the WBS Components or summarized in terms of a Grand Total, by phases of the Project, or by Major Deliverables (like Sub-Contractors).

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Each Resource in the Project must be accounted for and assigned to a Cost Category. Cost Categories include: Labor Costs  Material Costs  Travel Costs  Supplies  Hardware Costs  Software Costs
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The Cost of the Project is expressed in Monetary Terms, such as dollar, euro, or yen, so Management can compare Projects based on Costs. It may be acceptable, depending on the demands of the Performing Organization, to provide estimates in Staffing Hours or Days of Work to complete the Project along with the Estimated Costs.

2.3.3 Refining the Cost Estimates:

Through the Project Progresses, the Estimates are refined. Industry Guidelines and Organizational Policies may define how the Estimates are refined, but there are generally three accepted Categories of Estimating Accuracy: Rough Order of Magnitude: This Estimate is ‘rough’ and is used during the Initiating Processes and in Top-Down Estimates. The range of variance for the estimate can be -25% to +75%. Budget Estimate: This Estimate is also somewhat broad and is used early in the Planning Processes and also in Top-Down Estimates. The range of variance for the estimate can be -10% to +25%. Definitive Estimates This estimate type is one of the Most Accurate. It is used late in the Planning Processes and is associated with Bottom-Up Estimating. The range of variance for the estimate can be -5% to +10%.

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2.3.4

Considering Supporting Detail:
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Once the Estimates have been completed, Supporting Detail must be organized and documented to show how the Estimates were created. The Supporting Detail includes the following:
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Information on the Project Scope Work This may be provided by referencing the WBS. Information on the Approach used in Developing the Cost Estimates This can include how the estimate was accomplished and the parties involved with the Estimate. Information on the Range of Variance in the Estimate For example, based on the estimating method used, the Project Cost may be $220,000 ± $15,000. This Project Cost may be as low as $205,000 or as high as $235,000.

2.3.5 Developing the Cost Management Plan:

The Cost Management Plan details how Project Costs Variances will be managed.

3. Completing Project’s Cost Budgeting

Cost Budgeting: Cost Budgeting is the process of assigning a cost to an Individual Work Package. The goal of this process is to assign costs to the Work in the Project so that the Work may be measured for performance. Cost Budgeting involves aggregating the estimated Costs of Individual Activities or Work Packages to establish a Total Cost Baseline for measuring Project Performance. This is the creation of the Cost Baseline, as shown:

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Cost Budgeting and Cost Estimates may go hand-in-hand, but Estimating should be completed before a Budget is requested or assigned.

The difference between Cost Estimates and Cost Budgeting is that Cost Estimates show Costs by Category, whereas a Cost Budget shows Costs across Time according to Project’s Schedule.

3.1 Inputs to Project’s Cost Budgeting

Because Cost Budgeting and Cost Estimating are so closely related, you can expect many of the same inputs for both. Here are the inputs to Cost Budgeting:
3.1.1

Cost Estimates: These serve as key inputs; they are the predicted cost for the Project Work.

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3.1.2

Work Breakdown Structure: It is a key input to this process, as it is the Deliverables of the Project. Project Schedule: The Project Schedule is needed to determine when the money in the Budget will be spent. Risk Management Plan: The Risk Management Plan is considered because of information it provides of the probability of Identified Risks and their associated Costs. In addition, the Risks may have an expected Risk Value that contributes to the Contingency Reserve for the Project.

3.1.3

3.1.4

3.2 Tools & Techniques of Project’s Cost Budgeting --- Developing the Project Budget

The Tools and Techniques used to create the Project Cost Estimates are also used to create the Project Budget. Here is a quick reminder of the four components:
3.2.1

Similar Budgeting: This is a form of Expert Judgment that uses a Top-Down Approach to predict Costs. It is generally less accurate than other Budgeting Techniques.

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3.2.2

Parametric Modeling: This Approach uses a Parametric Model to extrapolate what Costs will be for a Project (for example, cost/hr and cost/unit). Bottom-Up Budgeting: This Approach is the most reliable, though it takes the longest time to create. It starts at zero and requires each Work Package to be accounted for. Computerized Tools: The same Software Programs used in Estimating can help predict the Project Budget with some accuracy.

3.2.3

3.2.4

3.3 Output of Project’s Cost Budgeting
3.3.1
o

Creating the Cost Baseline

A Project’s Cost Baseline shows what is expected to be spent on the Project. It is usually shown in an S-curve as follows:

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o

The idea of the Cost Baseline allows the Project Manager and Management to predict when the Project will be spending money and over what time period. The purpose of the Cost Baseline is to measure and predict Project Performance. The figure above “Cost Baselines” shows predicted Project Cost and Phase Cost Performance. Large Projects that have multiple Deliverables may have multiple Cost Baselines to illustrate the Costs within each Phase. Additionally, larger Projects may have Cost Baselines to predict Spending Plans, Cash Flows of the Project, and overall Project Performance. The purpose of a Cost Baseline is to measure Performance, and a Baseline will predict the expenses over the life of the Project. Any inconsistency early in the predicted Baseline and the Actual Costs serve as a signal that the Project is slipping.

o

o

o

o

4.

Implementing Project’s Cost Control
Cost Control focuses on the Ability of Costs to Change and on the ways of allowing or preventing Cost Change from happening.

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When a Cost Change does occur, the Project Manager must document the change and the reason why the change has occurred and, if necessary, create a Cost Variance Report. Cost Control is concerned with understanding why the Cost Variances (both good and bad) have occurred. The “why” behind the variances allows the Project Manager to make appropriate decisions on future Project Actions. Ignoring the Project Cost Variances may cause the Project to suffer from Budget Shortages, Additional Risks, or Scheduling Problems. Cost Control allows the Project Manager to deal with the problem, find a solution, and then act accordingly. Specifically, Cost Control includes:
o

Controlling Causes of Cost Change to ensure the changes are actually needed Controlling and Documenting Cost Changes to the Cost Baseline as they happen Controlling Cost Changes in the Project and their influence on Cost Recording Appropriate Cost Changes in the Cost Baseline Preventing Unauthorized Changes to the Cost Baseline Communicating the Cost Changes to the Proper Stakeholders Working to Bring and Maintain Costs within an Acceptable Range

o

o o o o o

4.1 Inputs to Project’s Cost Control
Cost Baseline:

4.1.1

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The Cost Baseline is the Expected Cost the Project will incur (deserve). The Cost Baseline is a tool used to measure Project Performance. Performance Reports: These Reports focus on Project Cost Performance, Project Scope, and Planned Performance versus Actual Performance. The Reports may vary according to Stakeholder Needs. Change Requests: When Changes to the Project Scope are requested, an analysis of the Associated Costs to complete the Proposed Change is required. In some instances, such as removing a portion of the Project Deliverable, a Change Request may reduce the Project Cost. Cost Management Plan: The Cost Management Plan dictates how Cost Variances will be managed.

4.1.2

4.1.3

4.1.4

4.2 Tools & Techniques of Project’s Cost Control
4.2.1

Creating a Cost Change Control System:

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 

Sometimes a Project Manager must add (or remove) Costs from a Project. The Cost Change Control System is a part of the Integrated Cost Change Control System which documents the procedures to Request, Approve, and incorporate Changes to Project Costs. When a Cost Change enters the System, there is appropriate Paperwork, a Tracking System, and Procedures the Project Manager must follow to obtain Approval on the Proposed Change. The following figure demonstrates a Typical Workflow for Cost Change Approval. If a Change gets Approved, the Cost Baseline is updated to reflect the Approved Changes. If a Request gets denied, the denial must be documented for future Potential Reference.

Three Phases of Change Management
(from Primavera Expedition) Phase DOC Type

1.Investigation
Identify Change
CIC RFI/Answer Sketch Bulletin Meeting Minutes Phone Record Project Engineer Tools to Initiate Change

2.Change Impact
($ & Time)
EST RFP PCO COR Project Manager Tools Collect

3.Resolve Change CO PRO

DONE BY

Approving Authority

A “Cost Change Control System” tracks and documents Cost Change Issues. The following represents some of Cost Change Documents: CIC = Change in Condition RFI = Request for Information EST = ESTimate RFP = Request For Proposal PCO = Proposed Change Order COR = Change Order Request CO = Change Order PRO = Proceed Order

4.2.2

Measuring Project Performance:

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Earned Value Management (EVM) is the process of measuring performance of Project Work against Plan to identify Variances. It can also be useful in predicting future variances and the final Costs At Completion. It is a System of Mathematical Formulas that compares Work Performed against Work Planned and measures the Actual Cost of the Work Performed. EVM is an important part of Cost Control as it allows a Project Manager to predict future variances from the expenses to date within the Project. EVM, in regard to Cost Management, is concerned with the relationships between three formulas that reflect Project Performance. The following figure demonstrates the relation between these EVM Values:

Earned Value Management measures Project Performance.

4.2.3

Planned Value (PV):

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Planned Value is the Work scheduled and the Budget authorized to accomplish that Work. Example: If a Project has a Budget of $100,000 and month 6 represents 50% of the Project Work, the PV for month 6 is $50,000. Planned Value used to be known as the Budget Cost of Work Scheduled (BCWS).

4.2.4

Earned Value (EV):

Earned Value is the Physical Work Completed to Date and the authorized Budget for that Work. Example: If a Project has a Budget of $100,000 and the Work Completed to Date represents 25% of the Entire Project Work, its EV is $25,000. Earned Value used to be known as the Budgeted Cost of Work Performed (BCWP).

4.2.5

Actual Cost (AC):

Actual Cost is the actual amount of money the Project has required to date. Example: If a Project has a Budget of $100,000 and $35,000 has been spent on the Project to Date, the AC of the Project would be $35,000. Actual Cost used to be known as Actual Cost of Work Performed (ACWP). These three values are key information about the Worth of the Project to Date: These values will be revisited later.

4.2.6

Additional Planning:

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Planning is an Iterative Process. Throughout the Project, there will be demands for Additional Planning and an output of Cost Control is one of those demands. Consider a Project that must complete by a given date and that also has a Budget. The balance between the Schedule and the Cost must be kept. The Project Manager can not assign a large crew to complete the Project Work if the Budget would not allow it. The Project Manager must (through planning) get as creative as possible to figure out an Approach to accomplish the Project without exceeding the Budget. The Balance between Cost and Schedule is an ongoing battle (fight). While it is usually easier to get more time than money, this is not always the case. Consider deadlines that can not move, or the Company may face penalties, or a deadline that centers on a tradeshow, or the start of the school year.

4.2.7

Using Computers:

Project Managers can rely on Project Management Software (Primavera, MS Project, etc…) and Spreadsheet Programs to assist them in calculating Actual Costs, Earned Value, and Planned Value.

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4.3 Outputs of Project’s Cost Control --- Cost Control Results

The Project Manager always does the following: Monitor Cost Variances and then understand why Variances have occurred.
o

Update the Cost Baseline as needed based on Approved Changes.
o

Work with the conditions and Stakeholders to prevent unnecessary Changes to the Cost Baseline.
o

Communicate to the Appropriate Stakeholders to discuss Cost Changes as they occur.
o o

Maintain Costs within an Acceptable and Agreed Range.

4.3.1

Revising Cost Estimates:
As the Project progresses and more detail come available, there may be a need to update the Cost Estimates. A revision to the Cost Estimates requires communication with the key Stakeholders to share why the Costs were revised.

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4.3.2

Updating the Cost Budget:
Updating the Cost Budget is slightly different than revising a Cost Estimate. Cost Budget Updates allow the Cost Baseline to be changed. The Cost Baseline is the “before Project Snapshot” of what the Total Project Scope and the Individual WBS Components should cost. Should the Project Scope grow, as shown here, the Cost will also likely change to be able to fulfill the new Scope.

If a Project has a drastic (radical) changes due to large changes to the Project Scope (false assumptions, or new demands from the Customer), it may be necessary to re-baseline the Project Cost. Re-baselining is done only in drastic changes. All Historical Information up to the re-baseline is cleared, and the Project starts fresh.

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4.3.3 Applying Corrective Actions:
Throughout a Project, the Project Manager will apply Corrective Actions. Corrective Actions are any actions applied to Project Performance to bring the Project back into position with the Project Plan. Corrective Actions can be Scheduling Changes, a Shift in Resources, a Different Approach to completing the Project Work, Any Action to bring the Project back to its expected level of Performance.

4.3.4

Preparing for the Estimate at Completion:

The Estimate at Completion (EAC) is a hypothesis of What the Total Cost of the Project will be. Before the Project begins, the Project Manager completes an Estimate for the Project Deliverables based on the WBS. As the Project progresses, there will be in most Projects some variances between what the Cost Estimate was and what the Actual Cost is. The difference between these Estimates is the Variance for the Deliverable. EAC is part of the Earned Value Management Approach (EVM). We have talked about Earned Value, Planned Value, and Actual Costs earlier. To complete this discussion on EAC, we well need another formula from the EVM family. It is the CPI (Cost Performance Index) as follows.

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4.3.5

Calculating the Cost Performance Index (CPI):
CPI is a value that demonstrates how the Project Costs are performing. CPI is a value that reveals How Much Money the Project is Losing. Or, if you are an optimist, How Much Money the Project is Making. Example: A Project with a CPI of .93 is losing seven cents on the Dollar (assuming US dollars). Or, for the Optimist, it is making .93 cents on the Dollar. The fact of the matter is, a Project with this CPI Value is likely to be Over Budget because for every Dollar spent, 7 cents evaporates (vanishes). The following shows the CPI in action:

CPI relates the Work you have accomplished to the amount you have spent to accomplish it. A Project with a CPI of .93 means you are spending 1.00 for every .93 Worth of Work Accomplished. Therefore, a CPI under 1.00 means the Project is Performing Poorly against the Plan.

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However, a CPI over 1.00 does not necessarily mean that the Project is Performing Well. It could mean that Estimates were inflated or that expenditure for equipment is late or sitting in accounts payable and has not yet been entered into the Project Accounting Cycle. In summary, If you do not want to think of the CPI Value as making or losing money, that is fine too. Just know the CPI Value should be as close to 1.00 as possible and do not celebrate too loudly if the CPI is greater than 1.00. A CPI greater than 1.00 may just reflect Poor Estimates rather than an OverPerforming Project.

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4.3.6

Calculating Estimate at Completion (EAC):

There are many approaches to calculating the EAC:

4.3.7

Experiencing Expected Conditions:

Estimate At Completion = Budget at Completion /Cost Performance Index EAC=BAC/CPI Example: If the Project’s BAC is $575,000 and the CPI is .91, the EAC for this Project is $631,868. Those 9 cents on every dollar sure do add up!

4.3.8

Accounting for Flawed (faulty) Estimates:
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Imagine a Project to Install a New Operating System on 1,000 Workstations. One of the assumptions the Project Team made was that each Workstation had the correct hardware to install the Operating System automatically. As it turns out, this assumption was wrong, and now the Project Team must change their approach to installing the Operating System. Exam Watch Because the assumption to install the Operating System was flawed (defective), a new Estimate To Complete the Project is needed. This new Estimate to Complete the Work is known as the “Estimate to Complete (ETC)”. The ETC represents how much more money is needed to complete the Project Work, and its formula is: ETC=EAC-AC. In this scenario of a flawed (imperfect) assumption, the Project Manager will use a slightly different formula to predict the EAC: EAC = AC +ETC Example: If the Project’s Original BAC was $100,000 and the Project Team had spent $20,000 before realizing the Project Assumption was flawed (faulty), they have to create a new ETC the remaining work. Let’s pretend (imagine) the ETC the Project Team arrived at was $175,000. The formula EAC = AC+ETC EAC = $20,000+$175,000 = $195,000. This is because the Project had spent $20,000, and $175,000 more is needed to complete the Work.

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4.3.9

Accounting for Anomalies:

Sometimes a Project suffers from Anomalies. Example:
o

Consider a Project to construct a “Wooden Fence Around a Large Building”. One of the Project Team Members made a mistake while installing the Wooden Fence and reverses the face of the Fencing Material. In other words, the Material for the outside of the Fence faces the wrong direction. The Project Manager now has to consume Additional Time to remove the Fence Material, correct the problem, and replace any Wood that may have been damaged in the incorrect Installation. This anomaly likely would not happen again, but it will add Costs to the Project. For these instances, when events happen but the Project Manager doesn’t expect similar events to happen again, the EAC Formula should be used: EAC=AC+BAC-EV. See page 48

o

o

o

o

o

Let’s try this out with our “Fencing Project”:
  

The Project’s AC so far was $7,000 The BAC was $24,500 The EV is only $2,450, as the Project has barely (just) started. (EV = %Comp * BAC) Therefore, EAC=$7,000+$24,500-$2,450 = $29,050 ---- a costly mistake.

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4.3.10 Closing Out the Project:
As part of Project Closeout, Phase Closeout, or even Project Cancellation, there must be Identified Processes and Procedures on how to shut down the Project. A formal Auditor may be called for to review the Time, Costs, Materials, and Budget of the Project. In some instances, a review may happen with Management or the Project Sponsor to account for the Project Budget and how well Cost Control was managed within the Project.

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4.3.11 Updating Lessons Learned:
As part of Cost Control, the Project Manager should update the Lessons Learned document to reflect the decisions behind the actions taken. For example, the Project Manager should identify: Changes to Cost Baseline and why they were Approved Corrective Actions and why they were Implemented Cost Control Challenges and Issues and how they were Resolved Other Cost Control Information that may be beneficial for other Projects

o o o o

Summary
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There are several factors that affect the Project’s Cost:
o o o

The Expense of Labor to complete the Project, The Expense of Materials needed to complete the Project, and The Expense of the Equipments needed to complete a Project.

These expenses must be estimated, planned for, and monitored for a Project to finish on Budget. Management and Customers want to know how much a Project is going to cost so they can determine if the Project is worth doing, if the Project Deliverable (outputs) will be worth the Cost, and if the Project will be Profitable. The Estimates for Project Costs can come in several forms:
o

Similar Estimating: Uses similar historical information to predict the cost of the current project. Parametric Modeling: Uses a parameter, such as cost per metric ton, to predict project costs. Bottom-Up Estimating: Starts from zero and adds the expenses from bottom-up. Top-Down Estimating: Uses a similar Project as a Cost Baseline and factors in current project conditions to predict costs. The Resources needed to complete a Project may be one of the biggest expenses in the Project’s Budget. The Activities the Resources complete must be worthy of the Resource’s Time. In other words, the Project Manager does not want to assign a $125/hr Engineer to filing Activity that a $15/hr Administrative Assistant is qualified to do. Accurate Assignment of Project Resources to Project Activities helps prevent waste. Projects also have four different kinds of Cost:

o

o

o

o

o

o

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Direct Costs: These are costs that consumed directly in the project and cannot be shared with operations or other Projects. Variable Costs: Costs that vary depending on the conditions within the Project. Fixed Costs: Costs that remain the same throughout the Project. Indirect Costs These costs can be shared across multiple projects that use the same Resources ---such as Training Room or Equipments.

Key Terms
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Earned Value (EV): A method of measuring project performance by comparing the amount of work planned with that actually accomplished, in order to determine if cost and schedule performance are as planned. Planned Value (PV)

 Actual Cost (AC)  Budget At Completion (BAC)  Estimate At Completion (EAC)  Schedule Variance (SV)  Cost Variance (CV)  Variance At Completion (VAC)  Responsibility Assignment Matrix (RAM) o RAM --- The integration of the WBS and the OBS (Organizational Breakdown Structure). o Proper creation of the RAM results from locating the intersection of the OBS unit that is assigned responsibility for the work and the specific WBS element that defines the work to be performed.
o

Example:  WBS Element : 1.1 Frame  OBS Element:Frame Shop  RAM: Mr. I. M. Smart  Budget: $125,000  Schedule: Jan – Jun 08

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 Performance Measurement Baseline (PMB)  Schedule Variance (SV)
o Comparing the EV (the amount originally budgeted for the work that has been completed or in-progress) to the PV (the amount budgeted for the work that was planned to have been accomplished) o SV = EV – PV o A –ve result means less work has been performed than was planned.
o

SV Example:  PV = $42,000  EV = $38,000  AC = $48,000  SV = EV – PV = $38,000 - $42,000 = - $4,000  SV% = SV / PV = -$4,000 / $42,000 = -0.095 = - 9.5%

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Cost Variance (CV):
o Comparing the amount originally budgeted for the work completed or in progress (EV) to the actual costs of that work (AV). That is: CV = EV – AC
o

A –ve CV means more dollars were spent to accomplish the work than was planned. Cost Variance Example:  PV = $42,000  EV = $38,000  AC = $48,000  CV = EV – AC = $38.000 - $48,000 = -$10,000  CV% = CV / EV = -$10,000 / $38,000 = -26%

o

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Cost Performance Indices:
o Cost Performance Index (CPI) = EV / AC
o

CPI Example:
    PV = $42,000 EV = $38,000 AC = $48,000 CPI = EV / AC = $38,000 / $48,000 = 0.79

That is $0.79 worth of work was actually done for each $1.00 spent. o Schedule Performance Index (SPI) = EV / PV
o

SPI Example:
    PV = $42,000 EV = $38,000 AC = $48,000 SPI = EV / PV = $38,000 / $42,000 = 0.90

That is $0.90 worth of work has been done for each $1.00 worth of work that was planned to be done.

Estimate At Completion (EAC):
o After Variance Analysis, the estimated cost at completion is determined
o

EAC Example:

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 BAC = $80,000  CPI = 0.79  EAC = BAC / CPI = $80,000 / 0.79 = $201,265

Variance At Completion (VAC):
o

VAC Example:
 BAC = $80,000

 EAC = $201,265  VAC $21,265 Based on past performance, project planned budget will exceed by $21,265.

= BAC – EAC = $80,000 - $101,265 =

To Complete Performance Index (TCPI):
o Work Remaining / Cost Remaining o TCPI = (BAC – EV) / (EAC – AC) = ($80,000 - $38,000) / ($101,000 $48,000) = $42,000 / $53,000 = 1.4

Example: PV
100 125

EV
125 100

AC
75 100

EAC
600 850
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BAC
560 800

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75 100

75 75

75 100

700 570

560 600

Problem:
o Given:  BAC = $40K  EV = $20K  PV = $28K  AC = $26K o Calculate:  % of Work Scheduled  % of Budget Spent  % of Work Accomplished  Cost Variance  Schedule Variance

Solution:
 % of Work Scheduled = PV / BAC = $28K / $40K = 70%  % of Budget Spent = AC / BAC = $26K / $40K = 65  % of Work Accomplished = EV / BAC = $20K / $40K

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= 0.50  Cost Variance $26K = EV – AC = $20K = -$6K  Schedule Variance = EV – PV = $20K $28K = - $8K

Self Test (Reference 2)
1. Which one of the following best describes analogous estimating? A. B. C. D.
2.

Regression analysis Bottom-up estimating Less accurate More accurate

You are the project manager for GHG Project. You are about to create the cost estimates for the project. Which input to this process will help you the most? A. B. C. D. Parametric modeling WBS Project scope Requirements document

3.

You are the project manager for the JKH Project. You have elected to use parametric modeling in your cost estimating for the project. Which one of the following is an example of parametric modeling?

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A. B. C. D.
4.

$750 per ton Historical information from a similar project Estimates built bottom-up based on the WBS Estimates based on top-down budgeting

You are the project manager for a new technology implementation project. Management has requested that your estimates be as exact as possible. Which one of the following methods of estimating will provide the most accurate estimate? A. B. C. D. Top-down estimating Top-down budgeting Bottom-up estimating Parametric modeling

5.

Your company has been hired to install the tile in 1,000 hotel rooms. All rooms will be identical in nature and will require the same amount of materials. You calculate the time to install the tile in each hotel room as six hours. The cost for labor for each room is calculated at $700. Your Project Sponsor disagrees with your labor estimate. Why? A. B. C. D. You haven’t completed one hotel room yet so you don’t know how long the work will actually take. You have not factored in all of the effort applied to the work. You have not considered the law of diminishing returns. You have not considered the learning curve.

6.

You are the project manager for a construction project to build 17 cabins. All of the cabins will be identical in nature. The contract for the project is set at a fixed cost, the incentive being the faster the project work is completed, the more the profitable the job. Management has requested that you study the work method to determine a faster, less costly, and better method to complete the project. This is an example of which one of the following? A. B. C. D. Time constraint Schedule constraint Value analysis Learning curve
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7.

You are the project manager for a technical implementation project. The customer has requested that you factor in the after-the-project costs, such as maintenance and service. This is an example of which one of the following? A. B. C. D. Life cycle costs Scope creep Project spin off Operations

(The after-the-project costs are known as the life cycle cost)

8. Which one of the following provides the least accurate in estimating? A. B. C. D. Rough order of magnitude Budget estimate Definitive estimate WBS estimate

(The rough order of magnitude is the least accurate approach, as it may vary from -25% to +75%.)

9. Which one of the following is true? A. B. C. D.
10. You

The cost management plan controls how change management affects the BAC. The cost management plan controls how cost variances will be managed. The cost management plan controls how the project manager may update the cost estimates. The cost management plan controls how the BAC may be adjusted

have just started a project for a manufacturer. Project team members report they are 30 percent done with the project. You agree with their completion status but do not change any of the progress in your report to the customer. This is an example of which one of the following? A. B. C. D. 50/50 rule 0/100 rule Percent Complete Rule Poor project management

(This completion method allows for 0%credit on an activity until it is 100% complete)
11. You

and your project team are about to enter a meeting to determine project costs. You have elected to use bottom-up estimating and will base
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your estimates on the WBS. Which one of the following is not an attribute of bottom-up estimating? A. B. C. D.
12. What

People doing the work create the estimates. Creates a more accurate estimate. More expensive to do than other methods. Less expensive to do than other methods.

is the present value if the organization expects to make $100,000 four years from now and the annual interest rate is 6%? A. B. C. D. $100,000 $58,000 $25,000 Zero

{PV = FV/(1+R)n [FV=future value; R=interest rate; n=number of time periods]}

13. You

are the project manager for the construction of a new hotel. Before you begin the cost budgeting process, what is needed? A. B. C. D. Costs estimates and project schedule Cost estimates and supporting detail EAC and BAC Parametric model used to arrive at the costs submitted

(B, C, & D are all not inputs to cost budgeting)
14. You

are the project manager of the MNJ Project. Your project is falling behind schedule and you have already spent $130,000 of your $150,000 budget. What do you call the $130,000? A. B. C. D. Planned value Present value Sunk costs Capital expenditure

(Sunk Costs are monies that have been spent)
15. You

are the project manager of the JHD Project. Your project will cost your organization $250,000 to complete over the next eight months. Once the project is completed, the deliverables will begin earning the company $3,500 per month. The time to recover the costs of the project is which one of the following?

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A. B. C. D.
16. You

Not enough information to know Eight months 72 months 5 years

(This is calculated by dividing the ROI of $3,500 per month into the project cost)

are the project manager for the consulting company. Your company has two possible projects to manage, but they can only choose one. Project KJH is worth $17,000, while Project ADS is worth $22,000. Management elects to choose Project ADS. The opportunity cost of this choice is which one of the following? A. B. C. D. $5,000 $17,000 $22,000 Zero, as project ADS is worth more than Project KJH

(The opportunity cost is the amount of the project that was not chosen)

17. You

are the project manager for the CSR Training Project, and 21,000 customer service reps (sales representatives) are invited to attend the training session. Attendance is optional. You have calculated the costs of the training facility, but the workbook expense depends on how many students register to the class. For every 5,000 workbooks created the cost is reduced a percentage of the original printing cost. The workbook expense is an example of which one of the following? A. B. C. D. Fixed costs Parametric costs Variable costs Indirect costs

(The more students that register to take the class the more the cost of the books will be)
18. You

are the project manager of a construction project scheduled to last 24 months. You have elected to rent a piece of equipment for the duration of a project, even though you will need the equipment only periodically throughout the project. The costs of the equipment rental per month are $890. This is an example of ________________. A. B. C. D. Fixed costs Parametric costs Variable costs Indirect costs
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19. You

are the project manager for the Hardware Inventory Project. You have a piece of equipment that was purchased recently for $10,000 and is expected to last five years in production. At the end of the five years the expected worth of the equipment is $1,000. Using straight-line deprecation, what is the amount that can be written off each year? A. B. C. D. Zero $1,000 $1,800 $2,000

[The straight-line depreciation takes the purchase value of the item, minus the salvage price of the item, divided by the number of time periods. That is ($10,000 $1,000)/5 = $1,800 per year.]

20. You

are the project manager of the LKG Project. The project has a budget of $290,000 and is expected to last 3 years. The project is now 10% complete and is on schedule. What is the BAC? A. B. C. D. $29,000 $290,000 $96,666 $9,666

(The BAC is the budget at completion, which is $290,000)
21. Your

project has a budget of $130,000 and is expected to last 10 months, with the work and budget spread evenly across all months. The project is now in month 3, the work is on schedule, but you have spent $65,000 of the project budget. What is your variance? A. B. C. D. $65,000 $39,000 $26,000 $64,999

(This is calculated by subtracting the actual costs of $65,000 from the earned value of $39,000. EV is calculated by taking the 30% completion of the project against the BAC. The project is considered to be 30% complete because it is slated (scheduled) for 10 months, is currently in month 3, and is on schedule.)
22. You

are the project manager of the Carpet Installation Project for new building. Your BAC is $600,000. You are now 40% done with the
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project, though your plan called for you to be 45% done with the work at this time. What is your earned value? A. B. C. D. $240,000 $270,000 $30,000 ?$30,000

(The earned value is calculated by multiplying the % of completion, 40%, by the BAC, which is %600,000, for a value of $240,000.)

23. You

are the project manager of the Carpet Installation Project for new building. Your BAC is $600,000. You have spent $270,000 of your budget. You are now 40% done with the project, though your plan called for you to be 45% done with the work at this time. What is your CPI? A. B. C. D. 100 89 .89 .79

(The EV of $240,000 is divided by the AC of $270,000 for a value of .89.)
24. You

are the project manager for the Facility Installation Project. The project calls for 1500 units to be installed into a new baseball stadium. Your team wants to know why you have not assigned the same amount of time for the last 800 units as you had for the first 500 units. You tell them it is because of the learning curve. Which one of the following best describes this theory? A. B. C. Production increases as workers become more efficient with the installation procedure. Efficiency increases as workers become more familiar with the installation procedure. Costs decrease as workers complete more of the installation procedure.

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D.

Time decreases as workers complete more of the installation procedure in the final phases of a project.

25. Of the following, which one is the most reliable source of information for estimating project costs? A. B. C. D. Historical information from a recently completed project An SME’s opinion Recollections of team members that have worked on similar projects Vendor’s white papers

Practical Part

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Scenario 1:

The Project Team has determined the Types of Skills (Roles) required for completing the Project Activities. The Project Team has also estimated the effort needed to accomplish the work. Specific Resources have not yet been assigned to the Project. Roles can be used as temporary placeholders for future Resource Assignments. A Role represents a Skill or Job defined in the Application. View the Roles Dictionary to become familiar with the Skill Sets that have been defined.

 Resource Management is divided into 3 distinctive parts:
1.

Defining Resources in the Resource Pool: Defining Resources has already been completed by the Project Office. Only specific information about specific Resources that have been defined has to review at the Corporation.

2.

Assigning Resources to Activities:

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Before Assigning Resources, the Project Manager must negotiate with the Resource Manager about the Resources Availability. Once the negotiation has occurred, it is the time to assign the Resources to the appropriate Activities.
3.

Analyzing Resource Allocation:
After Resource Assignment, we can start analyzing Resource Allocation. In this case, the Resources OverAllocation (Resources that are assigned to more work than they can perform) must be resolved. During Resource Allocation Analysis, a review of the Projects’ Cost has to make to ensure that the Project is within Budgetary Constraints.

Defining Roles & Resources:

Lesson 13, Training Material, Course 102 PRIMAVERA

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Assigning Roles:

Lesson 14, Training Material, Course 102 PRIMAVERA

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Assigning Resources & Costs:

Lesson 15, Training Material, Course 102 PRIMAVERA

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Analyzing Resources:

Lesson 16, Training Material, Course 102 PRIMAVERA

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Scenario 2:

Project Manager is responsible for evaluating the Project against the triple constraints:
1. 2. 3.

Schedule, Resources, and Cost.

He is also responsible to ensure that the Project Requirements as outlined in the Scope Document are being met.

Initially, the Project Manager should verify that the Project is scheduled to finish on time. If the Project delays, he has to make adjustments to the Project Plan by analyzing the Resources and resolve the over-allocation. Once the Schedule & Resources Adjustments have been made, validate the Project’s Cost. The Project’s Cost may have changes due to the Adjustments of Resources. Once the Project is optimized, baseline the Project. Baseline is a copy of a Project that can be used to compare against the Current Project to evaluate progress.

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Once the Baseline has been created, move to the Execution & Control Process. Information must be distributed to the Teem Members performing the work on the Project. Then the Work Accomplished must be reported back to the Project Manager. The Project Manager gathers information from the Teem Members and enters the data directly into Primavera to reflect the progress in the Project up to the Data Date.

Optimizing the Project Plan:

Lesson 17, Training Material, Course 102 PRIMAVERA

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Baselining the Project Plan:

Lesson 18, Training Material, Course 102 PRIMAVERA

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Project Execution & Control:

Lesson 19, Training Material, Course 102 PRIMAVERA

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Scenario 3:

As a Project Manager, you must prepare for a monthly Project Status Meeting, where Project Engineers report out on the progress of their works. The Project Manager needs to create a number of reports to distribute at the meeting to the Project Executive Committee.

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Reporting Performance:

Lesson 20, Training Material, Course 102 PRIMAVERA

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CASE STUDY
Building A 2nd Floor Of A Villa

Background:
1. You have been assigned the responsibility for scheduling and monitoring the progress of building the 2nd floor of a villa.
2. 3.

Major Engineering Design tasks have been completed.

The project consists of 29 major activities. The following list of project activities includes the basic information which you need to schedule and track the principle activities in the project. While you are in charge of the scheduling and implementing of the overall project, you will receive monthly reports of project implementation progress from the construction site supervisors.
4.

5. On the basis of monthly reports from the project site, you will monitor the progress of project execution.
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In carrying out your assignment, you are aware that the OWNER is anxious to open the project as early as possible.
6.

This Case Study will cover the following points:
1. 2.

Creating Project Calendar(s), Creating Work Breakdown Structure (WBS) with Responsible Managers Assignment. Entering project Activities with their Duration and Relationships. Scheduling & Assigning Constraints. Establishing Project & Activity Codes which may determine Project #, Project Manager, Responsibilities, Locations, Area, Phases, Milestones, etc…. Establishing Roles & Resources Dictionaries and Assign them to Activities as needed to execute the Project which may be Labor, Material, Nonlabor (Equipments), and Money (Expenses). Use the Cost Accounts feature to determine every item cost in the Project. Analyze Project Resources, Optimize the Project Plan, Baselining the Project Plan, Execute, and Control (Update). Producing different set of Reports, for example:

3.

4. 5.

6.

7.

8.

9.

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. Tabular Schedules, . Bar Charts, . Time-Scaled Logic Diagrams, . Project Network Diagrams, . Resource and Cost Reports: .. Project Labor, Nonlabor(Equipments), Material, and Expenses Costs, .. Project Cash-Flow, etc….
1.

Project’s Calendar(s):

Create a Project called Case_01 --- Creating Calendar called “Case Cal” Planning Unit: Day Workdays/week: 5 Week Start on: Sunday Project Start: 01-JAN-11 Holidays:
o o o o o o o

07-JAN-11 25-JAN-11, (28-JAN..31-JAN & Exception 30-JAN..31-JAN-11) 04-APR .. 09-APR & Exception 07-APR..09-APR-11) 01-MAY-11 18-JUN-11 23-JUL-11 06-OCT-11

Hint:
 

Calendar is a Global or Project Data. Create a New Global Calendar named for example, Case Cal ------ 5 D/W [SUN] with Holidays.

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 

There are no Repeated Holidays. Exception affects only on the Weekends days or the holidays from an “Inherited Holidays & Exceptions from Global Calendar”.

 To assign the created calendar to the project:
o

Highlight the Project in the “Projects” window.

o In the Project Details, click “Default” tab. o Assign the created Calendar from the “Calendar” field.

2.

Creating WBS of the Project:

Background: The Project Structure has been defined for this Project. We now need to add the WBS elements and assign Responsible Managers. The Project will be named Case_02 – Creating WBS. From “Projects” window, use “Edit -- Copy/Paste” & change the name of the new Project…. WBS Code Case_02.Admin Case _02.Prep Case _02.Concrete Case _02.Concrete.Columns Case _02.Concrete.SlabStairs Case _02.BlockWorking Case _02.WoodenWorks Case _02.Electrical Case _02.Sanitary Case _02.Isolation Case _02.IntPlastering WBS Name Project Administrator Preparation for the Project & Analysis Concrete Works Columns Slab and Stairs Block Working Wooden Works Electrical Works Sanitary Works Isolation Works Interior Plastering Responsible Manager (OBS)

INP_OBS

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Case _02.Painting Case _02.FrontPlastering Case _02.Flooring Case _02.Ceramic Case _02.HO

Painting Works Frontal Plastering (Facades) Flooring Works Ceramic Works Hand Over

Hint:

To make “Indent/Outdent” Active: o Click “Layout Option Bar/Group and Sort By/WBS” o Check the “ID/Code” box.

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3.

Creating Project’s Codes: (Enterprise / Project Codes…)

The Project will be named Case_03 – Creating Project Codes. Use “Edit--Copy/Paste” & change the name of the new Project….

Project Code Project # Project Location Project Manager Project Region

Code Value Case AR Hesham Heliopolis

Code Description Building 2nd Floor of a House Air Port Road Hesham Mostafa Heliopolis, Cairo

 

A Project Code Value can be associated with one User. To Create Project Codes:  Project Codes is a Global Data.

Create New Project Codes Hierarchy & Globally from “Enterprise/Project Codes”, or Assign Project Code Values to the existing Project Codes (our case).
o

So, Assign Project Codes to the Project (Click “Projects” & use “Codes” tab from “Project Details”).

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4. Adding Activities
The WBS and Project’s Calendar have been defined and approved for the Building of 2nd Floor in a Villa. The next step is to finish adding Activities to the Project. You will also add a Notebook topic and Steps to perform System Requirements Analysis. Project will be named Case_04 – Adding Activities. Use “Copy/Paste” & change the name of the new Project…. Hint:

All of the following Activities are of Duration Type “Fixed Duration & Units” and “Activity Type: Task Dependent” except for the 1st Activity (ADM2) which is of Activity Type “Level of Effort” PD = Planned Duration WBS Code Activity ID
ADM2 PRP2

** = Level of Effort Type Activity Name
Project Administration

PD
**

S.No.
1 2

Case_04.Admn Case_04.Prep

Preparing Project Requirements & 10d Analysis ‫التجهيز لبدء العمل‬ FormWork (Columns) ‫.اعمال شد النجارة للعمدة‬ R.F.T (Columns) ‫رص الحديد‬ ‫للعمده‬ Cast-in-place Concrete (Columns) ‫صب الخرسانة المسلحة‬ ‫للعمدة‬ Curing Time for Columns ‫اعمال المعالجة للعمدة‬ FormWork (Slab/ٍStairs) ‫شد النجارة المسلحة للسقف‬ ‫والسللم‬ R.F.T (Slab/Stairs) ‫رص الحديد‬ ‫للسقف‬ ‫والسللم‬ Cast-in-Place (Slab/Stairs) ‫صب الخرسانة المسلحة‬ ‫للسقف والسللم‬
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CO22C100 CO22C200

7d 4d 3d 5d 10d 7d 3d

3 4 5 6 7 8 9

Case_04. Concrete. Columns Case_04. Concrete. SlabStairs

CO22C300 CO22C400 CO22S100 CO22S200 CO22S300

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CO22S400

Case_04. BlockWorking

BLO2 100 BLO2 200 WOD2 100

Case_-04. WoodenWorks
WOD2 200 ELE2 100

Curing Time & Removal of FormWork for Slab/Stairs ‫اعمال المعالجة + فك الشدة‬ ‫الخشبية‬ Block Working thick 25 cm ‫أعمال مباني سمك 52 سم‬ Block Working thick 12 cm ‫أعمال مباني سمك 21 سم‬ Windows & Doors Sub-Frames Installation ‫تركيب حلوق البواب‬ ‫والشبابيك‬ Windows & Doors Installation ‫تركيب البواب والشبابيك‬ Electrical Conduits ‫تركيب مواسير الكهرباء في‬ ‫الحوائط‬ Electrical Wires ‫ادخال السلك في المواسير‬ ‫الكهربية‬ Electrical Switches Lighting Fix. ‫تركيبات كهربية نهائية‬ Sanitary Pipes ‫تركيب مواسير‬ ‫الزهر‬ Potable Water Piping Circuits .. ‫تركيب مواسير الشرب‬ ‫.. سباكة‬ Install of Sanitary Fixtures .. ‫تركيب الحواض والحنفيات‬ ‫.. سباكة‬ Bathrooms Proofing ‫اعمال العزل للحمامات‬ Internal Plastering for Walls & Slabs ‫البياض الداخلي للحوائط‬ ‫والسقف‬ TRATZO Plastering height 2m ‫سفل بارتفاع 2م ..عادة ما‬ ‫يكون بالممرات‬ Painting Preparation Layers ‫اعمال البطانة للدهانات‬ Painting Layers ‫اعمال‬ ‫الدهانات النهائية‬

10d

10

12d 4d 7d

11 12 13

10d 7d

14 15

Case_04. Electrical

ELE2 200 ELE2 300 SAN2 100 SAN2 200

14d 14d 20d 9d 6d 2d

16 17 18 19 20 21

Case_04.Sanitary
SAN2 300

Case_04. Isolation

ISO2 100

INP2 100

20d 8d 6d 12d

22 23 24 25

Case_04. IntPlastering

INP2 200 PAI2 100

Case_04.Painting

PAI2 200

Case_04.

FRP2 100

Frontal Plastering ‫12 بياض الواجهات‬d

26

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FrontPlastering Case_04.Flooring Case_04.Ceramic Case_04.HO
FLO2 100 CER2 100 END2 Mosaic Tiles dim 40*40 cm 10d 40*40 ‫تركيب بلط‬ ‫سم‬ Ceramic Working 4d ‫تركيب السراميك للحوائط‬ ‫والسقف‬ Hand Over ‫01 تسليم‬d ‫الدور الثاني‬ 27 28 29

Add a Purpose Notebook topic to Activity “PRP2” as follows: ِAssign “Customer Problem” and add the following Notebook: “Participate in Analyzing User Input provided by the Acquirer to gain an understanding of User Needs. This input may take the form of Need Statements, Surveys, Interviews, or other User Feedback.”
o

Add the following Steps to Activity PRP2:
o

Identify Required States and Modes

o Define System Requirements o Perform Requirements Tracing o Document Requirements

5.

Creating Activities Relationship*
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Background: Now that the Activities have been entered, Relationships need to be established. Use the information from the table below to create relationships between the Activities. The Project will be named Case _05 – Creating Relationships.

Activity ID
ADM2* BLO2 100 BLO2 200 CER2 100 CO22C100 CO22C200 CO22C300 CO22C400 CO22S100 CO22S200 CO22S300 CO22S400 CO22S400 ELE2 100 ELE2 100 ELE2 200 ELE2 300 FLO2 100 FRP2 100

Activity Name

Successor
END2 WOD2 100 WOD2 100 PAI2 100 CO22C200 CO22C300 CO22C400 CO22S100 CO22S200 CO22S300 CO22S400 BLO2 100 BLO2 200 INP2 100 SAN2 100 PAI2 100 END2 PAI2 100 SAN2 300

Relation Lag Type
FF SS FS FS SS FS FS SS FF FS FS FS FS FS FS FS FS FS FS 0 8 0 0 4 0 0 3 2 0 0 0 0 0 0 0 0 0 0

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INP2 100 INP2 200 INP2 200 ISO2 100 PAI2 100 PAI2 200 PRP2 SAN2 100 SAN2 200 SAN2 300 WOD2 100 WOD2 200

INP2 200 ELE2 200 FLO2 100 CER2 100 FRP2 100 ELE2 300 CO22C100 SAN2 200 ISO2 100 WOD2 200 ELE2 100 PAI2 200

FS FS FS FS FS FS FS FS FS FS FS FS

0 0 0 0 0 0 0 0 0 0 0 0

The “Level of Effort” Activity (ADM2*) requires both a
Predecessor and a Successor.
o

Predecessor: Start-to-Start relationship with PRP2 Activity with 1 day of Lag. Successor: Finish-to-Finish relationship with END2 Activity.

o

6.

Project Scheduling
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Background:
Having entered Activities, Duration, and Relationships for the Project, You are now ready to schedule the Project. Open the Project Case-06 – Scheduling and schedule the Project and view the “Schedule Log” of the Project’s Statistics. The Project will be named Case_06 – Scheduling. Use “Copy/Paste” & change the name of the new Project….

Question:

Use the “Schedule Log” to answer the following questions:
7. 8. 9.

How many activities are in the Project? ________________ How many relationships are in the Project? _____________ How many activities do not have Predecessors and/or Successors (Open Ends) in the Project? ______ _______ What is the Latest Early Finish Date for the Project? _____ How many Critical Activities in the Project? ____________

10. 11.

Hint:

Press “Schedule” icon Press “View Log” to see Schedule Report.

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2.

Creating Activity Codes Dictionary:

The Project will be named CASE_07 – Creating Activity Codes Dictionary.
No 1 Act. Code Name/ Description Case_Resp Responsibility Code Value AHMED AMR 2 3 Case_Area Area/Location Case_Mile MileStone Case_Type1 Type of Work 1 NOHA AR E C P S ADM BLO CER CO2 ELE END FLO FRP INP ISO PAI SAN PRP WOD 1 2 C S 100 200 300 400 Code Title Resp of Reinforcement Works & Others Resp of Electrical Works & Others Resp of Finishing Works & Others Air Port Road, Heliopolis, Cairo MileStone for Electrical Works MileStone for Concrete MileStone for Painting Works MileStone for Sanitary Works Project Administration Block Works Ceramic Tiles Reinforcement Concrete(RFT) Electrical Works Hand Over Flooring Works Frontal Plastering Internal Plastering Isolation Works Painting Works Sanitary Works Preparation for the Project Wooden Works First Floor Second Floor

4

5 6 7

Case_Floor# Floor Number Case_ColSlab Columns/Slab&Stairs Case_Type2 Type of Work 2



  

Activity Codes here will be created on the Global-Level. !!!!! Open the Project. Click “Enterprise/Activity Codes…”, a “Primavera” Alarm window displays. Click “OK” Choose “Global”. Click “Modify” Click “Add” Continue…

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3.

Assigning Activity Codes: (Activities Sorted Alphabetically)

The Project will be named Case_08 – Assigning Activity Codes.

No Activity
ID

Activity Name

PD Resp

Case_ A M r i e l a e AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR AR P P S S

T y p 1

Col S l a b

01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

ADM2 BLO2 100 BLO2 200 CER2 100 CO22C100 CO22C200 CO22C300 CO22C400 CO22S100 CO22S200 CO22S300 CO22S400 END2 ELE2 100 ELE2 200 ELE2 300 FLO2 100 FRP2 100 INP2 100 INP2 200 ISO2 100 PAI2 100 PAI2 200 SAN2 100 SAN2 200

Project Administration Block Work thick 25 cm Block Work thick 12 cm Ceramic Work (Walls & Slabs) Form Work Columns R.F.T Columns Cast-in-Place Concrete Columns Curing Time for Columns Form Work (Slabs & Stairs) R.F.T (Slabs & Stairs) Cast-in-Place (Slabs & Stairs) Curing Time & Removal of FormWork for Slab/Stairs Hand Over Electrical Conduits Electrical Wires Electrical Switches Lighting Fix. Mosaic Tiles Dim 40*40 cm Frontal Plastering Internal Plastering for Walls & Stairs TRATZO Plastering Height 2m Bathrooms Proofing Painting Preparation Layers Final Painting Layers Sanitary Pipes Potable Water Piping Circuits
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--12 4 4 7 4 3 5 11 7 3 10 10 7 14 14 10 21 20 8 2 6 12 20 9

AHMED NOHA NOHA NOHA AHMED AHMED AHMED AHMED AHMED AHMED AHMED AHMED NOHA AMR AMR AMR NOHA NOHA NOHA NOHA AHMED NOHA NOHA NOHA NOHA

C CO2 C CO2 C CO2 C CO2 C CO2 C CO2 C CO2 C CO2 E E E

C C C C S S S S

100

26 27 28 29

SAN2 300 PRP2 WOD2 100 WOD2 200

Installation of Sanitary Fixtures Preparing Project Requirements & Analysis Windows & Doors SubFrames Installation Doors & Windows Installation

6 10 7 10

NOHA AHMED NOHA NOHA

AR AR AR AR

S

* Activities here are sorted alphabetically. ** Note: You can sort them by ES and TF. *** MileStone here does not mean Activity MileStome. It is used for example to group Activities.

Questions Related to Activity Codes:
1. Display all activities of RFT.
  2.

Check that the Code Case_Type1 is assigned to the activities: CO22C100 .. CO22S400. Create and execute a Filter: Where “Case_Type1 = CO2”

Display all Activities related to Eng Ahmed & Columns Only.

Do not forget to assign the Activity Code “Case_ColSlab” to the corresponding Activities.

3. 4. 5. 6. 7. 8.

Display all Activities of Columns. Display all Activities of Slab & Stairs. Display any Activities of Eng. Ahmed or Amr. Display all Activities of Eng. Ahmed and Amr. Display all Activities in 2nd Floor & RFT (i.e., CO2…activities) Create Schedule Report with ES < 01-MAR-09 and Eng. Ahmed

9. …etc Hint: The following Layout comes from: o “Layout Option Bar/Group and Sort/Group By ---- Case_Resp o Click “ID/Code” box

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4. Resources Management
The Project will be named CASE_09 – Resource Breakdown Structure.

Resources Breakdown Structure (RBS) Root: Case_RBS

LaborCase

------ Labor of Case_RBS

o Carpenter o Steel.Men o Con.Labor o Ord.Labor o Bric.Lay o Door.Carp o Plas.Men o Plumber o Tile.Men o Iso.Men o Cer.Men o Paint.Men o Plumber-1 o Front.Plaster o Light.Fixturer o Removal o TRAT.Plaster.Men o . . .

Resources

EquipmentsCase
o Conc.Mix o Up.Crane o . . .

------ Equipments of Case_RBS
Resources

MaterialsCase ------ Materials of Case_RBS
o o o o
o o

o o o
o

o o o o
o

R.F.T Cement Sand Gravel Water.Price Brick.Mat Gypsum Paint.Mat San.Pipe WhiteCem Iron.Pip Mosaic Isolation San.Fix Mos.Door

Resources

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o Light.Fixation o Ord.Tiles

Now,
   

Click “Enterprise/Resources”. Click the “Display Option” bar. Choose “Group and Sort By/Default”. Press “Add” in the “Command” bar o Add the Root of the RBS: Resource ID: Case_RBS Name: Case Study Resources
o

Under the Root Resource ID (Case_RBS), “Add” the 2nd Levels. For example: Case_RBS. LaborCase Case_RBS.EqupmentsCase Case_RBS.MaterialsCase

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Hint: Creating Resources’ Units of Measure

You can establish the Resource’s Units of Measure (to be used with Materials Resources) as follows:
o o

Click “Admin/Admin Categories…” Click “Units of Measure” button, the “Admin Categories” displays. Click “Add”. Write the “Unit Abbreviation” & “Unit Name” for the required Units of Measure. For our Case Study, we have the following Units of Measures:

o o

o

SN 01 02 03 04 05 06 07

Unit Abbreviation Ton Day CM SM LM Part Each

Unit Name Ton Day Cubic Meter Square Meter Long Meter Part Each

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After establishing Units of Measure, You can select the Unit of Measure when assigning the Resources to Activities in the Activities window.

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5.

Creating Resources Dictionary

The Project will be named Case_10 – Resource Dictionary. “Add” the coming Resources for each corresponding RBS Items…

A) LaborCase (People)*
Hint: Do not forget to assign the Default Project Calendar (It should be better to be Global Calendar. It is called in our case: Case Cal- 5 D/W [SUN] with Holidays) to the different Resources except when there are Resource Calendars… NO RESOURCE/ DISCRIPTION Administer Plumber ‫سباك -- طقم‬ Crew(1 Blumber+ 1 Assistant) Bric.Lay ‫بنآ‬ Crew(8 B.L +2 Mortar + 2 Handling) Carpentr ‫النجارين‬ Crew(Carpenter + Assistant) Cer.Men ‫متخصص تركيب سيراميك‬ Crew(1 Chief + 1 Assistant) Con.Labor ‫الطبلية‬ Crew(20 Workers) Door.Carp ‫نجار باب و شباك‬ Crew(1 Carpenter + 1 Assistant) Front.Plaster ‫بياض المحارة --- واجهات‬ Crew(2 Palstmen + 2 Assistant + 1 Worker) Iso.Men Crew(1 Chief + 2 Assistant) Ord.Labor Ordinary Labor Paint.Men ‫النقاشين‬ Crew(4 Painters + 2 Assistants) Plas.Men ‫متخصص بياض‬ Crew(1 Plaster Man + 1 Mortar) Removal Removal of FormWork to Upper Level Steel.Men ‫الحدادين‬ Crew(2 St. Cut. + 2 St. Erection + 3 Assist.) Tile.Men ‫المبلطين‬ Def. Units /Time (h/d) 1h/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d 8/d Max. Units /Time (h/d) 1h/d 24/d 32/d 80/d 16/d 16/d 56/d 32/d 16/d 136/d 16/d 40/d 40/d 32/d 16/d Price/ Unit ($) ($/d) 50/h 23/d 75/d 25/d 28/d 300/d 28/d 60/d 25/d 20/d 100/d 25/d 20/d 70/d 130/d

01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

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16 17

Tile Men for Mosaic Flooring) TRAT.Plaster.Men ‫المبيضين‬ Crew(2 Plastermen + 2 Mortar) TRATZO Plaster Men. PM Project Manager

8/d 8/d

16d 16d

50/d 300/d

Data to be entered in the “Resource Dictionary”

B) EquipmentsCase - NonLabor
NO RESOURCE/ Def. Max. Price/

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DISCRIPTION 1 2 Conc.Mix ‫الخلطة الخرسانية‬ Concrete Mixer used for R.F.T , P.C *
* (P.C = Plain concrete)

Units /Time (h/d) 8/d 8/d

Units /Time (h/d) 16/d 8/d

Unit of Time ($/d) 400/d 50/d

Up.Crane ‫ونش لرفع الطوب‬ Up. Lift Crane used for Bricks

C) MaterialsCase
NO 01 01d 02 03 04 05 06 07 08 9 10 11 12 13 14 15 16 RESOURCE/ DISCRIPTION Brick.Mat ‫الطوب‬ Brick material thickness 12 cm Brick.Mat ‫الطوب‬ Brick material thickness 25 cm Cement Cement Ceramic Ceramic Dim 20*20 cm Gravel ‫زلط‬ Gravel for Different Tasks Gypsum ‫جيبس‬ Gypsum for different Tasks Insulation ‫المادة العازلة‬ Insulation Material for Water Proofing Iron.Pip ‫مواسير الحديد‬ Iron Pipe diameter .5” Light.Fixation ‫تركيبات كهربية‬ Electric Switches and Lighting Fixtures Mos.Door ‫البواب والشبابيك‬ ‫الموسكي‬ Moskey Materials (Door + Window) Mosaic ‫الموزايك‬ Mosaic Tiles dim 40*40 cm Ord.Tile ‫بلط عادي‬ Ordinary Tiles for Roof dim 20*20 cm Paint.Mat Painting Materials R.F.T ‫حديد التسليح‬ Reinforcement Steel San.Fixt ‫أجهزة صحي‬ Sanitary Fixtures SAN.PIPE ‫مواسير الصرف الصحي‬ Pipe Material for Sanitary Pipes Sand Unit of Measure SM SM Ton SM CM Ton SM LM Part Part SM SM SM Ton Part LM CM 10/d Def. Units /Time Max. Units/ Time 180/d 180/d 8/d 50/d 60/d 1/d 50/d 100/d 10/d 12/d 60/d 40/d 300/d 3/d 10/d 30/d 12/d Price/ Unit ($/U) 6 12 380 25 22 108 5 5 200 150 20 5 3 3600 1200 20 5

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Sand for Different Tasks 17 18 Water.Price ‫مياه‬ Water WhiteCem White Cement CM Ton 10/d 1/d 10 500

Hint: Click “Edit/User Preferences…/Time Units tab” to customize the Units of Time as follows:  Units Format: o Unit of Time: hour  Duration Format: o Unit Time: day  Units/Time Format: o Choose “Show as units/duration”  No need for writing values in the “Default Units/Time” of Materials except when needed…  Close

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111

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112

6. Assigning Resources and Costs
Project Manager has identified the specific Resources that will be work on this Project. Project will be named Case_11 – Assigning Resources & Costs.

Assign Resources based on the table below. If an activity has multiple resource assignments, the 1st resource listed is the Primary Resource.
(Activities are sorted by Act. ID)

No
01 02 03-1 03-2 03-3 04-1 04-2 04-3

Act. ID
ADM2 PRP2 BLO2 100 BLO2 100 BLO2 100 BLO2 200 BLO2 200 BLO2 200

Title
Project Administration Preparing Project Requirements & Analysis Block Work thick 25 cm Block Work thick 25 cm Block Work thick 25 cm Block Work thick 12 cm Block Work thick 12 cm Block Work thick 12 cm

OD

Resource ID
Administer PM Bric.Lay Cement Brick.Mat Bric.Lay Brick.Mat Cement

Res. Type
L

Unit Default of Units/ Measure Time
1h/d

--10d 12d 12d 12d 04d 04d 04d

Budgeted Units/ Time 1h/d 8/d

L M M L M M

TON CM

1/d 10/d

24/d 20/d 180/d 16/d 80/d 10/d

1/d SM TON

P3eCaseStudy - 112

113

05-1 05-2 05-3 06 07-1 07-2 08-1 08-2 08-3 08-4 08-5 09-1 09-2 10 11-1 11-2 12-1 12-2 12-3 12-4 12-5

CER2 100 CER2 100 CER2 100 CO22C100 CO22C200 CO22C200 CO22C300 CO22C300 CO22C300 CO22C300 CO22C300 CO22C400 CO22C400 CO22S100 CO22S200 CO22S200 CO22S300 CO22S300 CO22S300 CO22S300 CO22S300

Ceramic Work (Wall&Slabs) Ceramic Work (Wall&Slabs) Ceramic Work (Wall&Slabs) Form Work Columns R.F.T Columns R.F.T Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Curing time for Columns Curing time for Columns Form Work (Slabs/Stairs) R.F.T (Slabs/Stairs) R.F.T (Slabs/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs)

04d 04d 04d 07d 04d 04d 03d 03d 03d 03d 03d 05d 05d 11d 07d 07d 03d 03d 03d 03d 03d

Ceramic Cer.Men Sand Carpenter R.F.T Steel.Men Conc.Mix Con.Labor Cement Sand Gravel Water.Price Ord.Labor Carpenter Steel.Men R.F.T Con.Labor Conc.Mix Cement Sand Gravel

M L M L M L E L M M M M L L L M L E M M M

SM 1/d CM 1/d TON 1/d 1/d 1/d TON CM CM CM 1/d 1/d 1/d TON 1/d 1/d TON CM CM

50/d 16/d 3/d 48/d 3/d 24/d 2/d 32/d 10/d 20/d 25/d 10/d 8/d 80/d 24/d 4/d 16/d 2/d 25/d 30/d 60/d

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13-1 13-2 14-1 14-2 15-1 15-2 16-1 16-2 17 18-1 18-2 18-3 18-4 19-1 19-2 19-3 19-4 19-5

CO22S400 CO22S400 ELE2 100 ELE2 100 ELE2 200 ELE2 200 ELE2 300 ELE2 300 END2 FLO2 100 FLO2 100 FLO2 100 FLO2 100 FRP2 100 FRP2 100 FRP2 100 FRP2 100 FRP2 100

Curing Time & Removal of FormWork for Slab/Stairs Curing time & Removal of FormWork for Slab/Stairs Electrical Conduits Electrical Conduits Electrical Wires Electrical Wires Electrical Switches Lighting Fix Electrical Switches Lighting Fix Hand Over Mosaic Tiles dim 40*40 cm Mosaic Tiles dim 40*40 cm Mosaic Tiles dim 40*40 cm Mosaic Tiles dim 40*40 cm Frontal Plastering Frontal Plastering Frontal Plastering Frontal Plastering Frontal Plastering

10d 10d 07d 07d 14d 14d 14d 14d 10d 10d 10d 10d 10d 21d 21d 21d 21d 21d

Ord.Labor Water.Price

L M CM

1/d

8/d 16/d

Light.Fixation

M

PART

18/d

Mosaic Tile.Men Sand Cement Front.Plaster Cement Sand Gypsum WhiteCem

M L M M L M M M M

SM 1/d CM TON 10/d 1/d 10/d

125/d 16/d 5/d 1/d 40/d 2/d 4/d 1/d 1/d

TON CM TON TON

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20-1 20-2 20-3 20-4 21-1 21-2 21-3 21-4 21-5 22-1 22-2 23-1 23-2 24-1 24-2 25-1 25-2 26-1 26-2

INP2 100 INP2 100 INP2 100 INP2 100 INP2 200 INP2 200 INP2 200 INP2 200 INP2 200 ISO2 100 ISO2 100 PAI2 100 PAI2 100 PAI2 200 PAI2 200 SAN2 100 SAN2 100 SAN2 200 SAN2 200

Internal Plastering for Walls & Slabs Internal Plastering for Walls & Slabs Internal Plastering for Walls & Slabs Internal Plastering for Walls & Slabs TRATZO Plastering TRATZO Plastering TRATZO Plastering TRATZO Plastering TRATZO Plastering Bathrooms Proofing Bathrooms Proofing Painting Preparation Layers Painting Preparation Layers Final Painting Layers Final Painting Layers Sanitary Pipes Sanitary Pipes Potable Water Piping Circuits Potable Water Piping Circuits

20d 20d 20d 20d 08d 08d 08d 08d 08d 02d 02d 06d 06d 12d 12d 20d 20d 09d 09d

Front.Plaster Cement Sand Gypsum Plas.Men Cement Sand Gypsum WhiteCem Isolation.Men Insulation Paint.Men Paint.Mat Paint.Mat Paint.Men Plumber-1 San.Pipe Plumber-1 Iron.Pip

L M M M L M M M M L M L M M L L M L M

TON CM TON

1/d 10/d

32/d 2/d 6/d 1/d 24/d 2/d 30/d 1/d 1/d 8/d 100/d 16/d 308/d 308/d 16/d 24/d 60/d 24/d 20/d

TON CM TON TON

1/d 10/d

1/d SM 1/d SM SM 1/d 1/d LM 1/d LM

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27-1 27-2

SAN2 300 SAN2 300

Install of Sanitary Fixtures Install of Sanitary Fixtures

06d 06d

Plumber-1 San.Fixt

L M

1d PART

16/d 2/d

28 29-1 29-2

WOD2 100 WOD2 200 WOD2 200

Windows & Doors Sub-Frames Installation Windows & Doors Installation Windows & Doors Installation

07d 10d 10d

Door.Carp Door.Carp Mos.Door

L L M

1/d 1/d PART

32/d 56/d 8/d

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7. Cost Accounts Dictionary
Project will be named Case_12 – Coat Account Dictionary.

Cost Accounts Structure: Root: Case_CA Cost Categories:
Cost Category Code -------------------------L E M S Category Title ---------------------------Labor Nonlabor (Equipment) Material Expenses

Hint: Use “Enterprise/Cost Accounts…” to build Cost Account Dictionary..

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Cost Account:
Hint: Each Activity has its own Cost Account. So, most of Cost Accounts take the names of Activities IDs No
01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

Cost Account Prefix

Cost Account ID
ADM2 BLO2 100 BLO2 200 CER2 100 CO22C100 CO22C200 CO22C300 CO22C400 CO22S100 CO22S200 CO22S300 CO22S400 END2 ELE2 100 ELE2 200 ELE2 300 FLO2 100 FRP2 100 INP2 100 INP2 200 ISO2 100

Cost Account Name
Project Administration Block Work thick 25 cm Block Work thick 12 cm Ceramic Work (Walls & Slabs) Form Work Columns R.F.T Columns Cast-in-Place Concrete Columns Curing time for Columns Form Work (Slabs & Stairs) R.F.T (Slabs & Stairs) Cast-in-Place (Slabs & Stairs) Curing time & Removal of FormWork for Slab/Stairs Hand Over Electrical Conduits Electrical Wires Electrical Switches Lighting Fix. Mosaic Tiles Dim 40*40 cm Frontal Plastering Internal Plastering for Walls & Stairs TRATZO Plastering Height 2m Bathrooms Proofing
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Cost Account Category Suffix

Case_CA.

Each Cost Account have all of the Cost Categories: L, E, M, and S

119

22 23 24 25 26 27 28 29

PAI2 100 PAI2 200 SAN2 100 SAN2 200 SAN2 300 PRP2 WOD2 100 WOD2 200

Painting Preparation Layers Final Painting Layers Sanitary Pipes Potable Water Piping Circuits Installation of Sanitary Fixtures Preparing Project Requirements & Analysis Windows & Doors Sub-Frames Installation Doors & Windows Installation

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8. Assigning Cost Accounts
Project will be named Case_13 – Assigning Coat Accounts
Note: There is only one Cost-Account (with different categories) for each Activity Cost Accounts exist where there are Resources….

No
01 02 03-1 03-2 03-3 04-1 04-2 04-3 05-1 05-2 05-3 06

Act. ID
ADM2 PRP2 BLO2 100 BLO2 100 BLO2 100 BLO2 200 BLO2 200 BLO2 200 CER2 100 CER2 100 CER2 100 CO22C100

Title
Project Administration Preparing Project Requirements & Analysis Block Work thick 25 cm Block Work thick 25 cm Block Work thick 25 cm Block Work thick 12 cm Block Work thick 12 cm Block Work thick 12 cm Ceramic Work (Wall&Slabs) Ceramic Work (Wall&Slabs) Ceramic Work (Wall&Slabs) Form Work Columns

OD

Resource Name

Res. Type
L

Cost Account
ADM2.L PRP2.L

--10d 12d 12d 12d 04d 04d 04d 04d 04d 04d 07d BRIC.LAY CEMENT BRICKMAT BRIC.LAY BRICKMAT CEMENT CERAMIC CER.MEN SAND CARPENTR

L M M L M M M L M L

BLO2 100.L BLO2 100.M BLO2 100.M BLO2 200.L BLO2 200.M BLO2 200.M CER2 100.M CER2 100.L CER2 100.M CO22C100.L

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07-1 07-2 08-1 08-2 08-3 08-4 08-5 09-1 09-2 10 11-1 11-2 12-1 12-2 12-3 12-4 12-5 13-1 13-2 14-1 14-2 15-1

CO22C200 CO22C200 CO22C300 CO22C300 CO22C300 CO22C300 CO22C300 CO22C400 CO22C400 CO22S100 CO22S200 CO22S200 CO22S300 CO22S300 CO22S300 CO22S300 CO22S300 CO22S400 CO22S400 ELE2 100 ELE2 100 ELE2 200

R.F.T Columns R.F.T Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Cast-in-Place Concrete Columns Curing Time for Columns Curing Time for Columns Form Work (Slabs/Stairs) R.F.T (Slabs/Stairs) R.F.T (Slabs/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Cast-in-Place (Slab/Stairs) Curing time & Removal of Form Work for Slab/Stairs Curing time & Removal of Form Work for Slab/Stairs Electrical Conduits Electrical Conduits Electrical Wires

04d 04d 03d 03d 03d 03d 03d 05d 05d 11d 07d 07d 03d 03d 03d 03d 03d 10d 10d 07d 07d 14d

R.F.T STEELMEN CONC.MIX CON.LABR CEMENT SAND GRAVEL WATERPRI LABOUR CARPENTR STEELMEN R.F.T CON.LABR CONC.MIX CEMENT SAND GRAVEL LABOUR WATERPRI

M L E L M M M M L L L M L E M M M L M

CO22C200.M CO22C200.L CO22C300.E CO22C300.L CO22C300.M CO22C300.M CO22C300.M CO22C400.M CO22C400.L CO22S100.L CO22S200.L CO22S200.M CO22S300.L CO22S300.E CO22S300.M CO22S300.M CO22S300.M CO22S400.L CO22S400.M ELE2 100.L ELE2 100.M ELE2 200.L

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15-2 16-1 16-2 17 18-1 18-2 18-3 18-4 19-1 19-2 19-3 19-4 19-5 20-1 20-2 20-3 20-4 21-1 21-2 21-3 21-4 21-5

ELE2 200 ELE2 300 ELE2 300 END2 FLO2 100 FLO2 100 FLO2 100 FLO2 100 FRP2 100 FRP2 100 FRP2 100 FRP2 100 FRP2 100 INP2 100 INP2 100 INP2 100 INP2 100 INP2 200 INP2 200 INP2 200 INP2 200 INP2 200

Electrical Wires Electrical Switches Lighting Fix Electrical Switches Lighting Fix Hand Over Mosaic Tiles dim 40*40 cm Mosaic Tiles dim 40*40 cm Mosaic Tiles dim 40*40 cm Mosaic Tiles dim 40*40 cm Frontal Plastering Frontal Plastering Frontal Plastering Frontal Plastering Frontal Plastering Internal Plastering for Walls & Slabs Internal Plastering for Walls & Slabs Internal Plastering for Walls & Slabs Internal Plastering for Walls & Slabs TRATZO Plastering TRATZO Plastering TRATZO Plastering TRATZO Plastering TRATZO Plastering

14d 14d 14d 10d 10d 10d 10d 10d 21d 21d 21d 21d 21d 20d 20d 20d 20d 08d 08d 08d 08d 08d MOSAIC TILE.MEN SAND CEMENT FRON.PLA CEMENT SAND GUYPSUM WHITECEN PLAS.MEN CEMENT SAND GUYPSUM PLAS.MEN CEMENT SAND GUYPSUM WHITECEN M L M M L M M M M L M M M L M M M M LIG.FIXT M L

ELE2 200.M ELE2 300.M ELE2 300.L END2.L FLO2 100.M FLO2 100.L FLO2 100.M FLO2 100.M FRP2 100.L FRP2 100.M FRP2 100.M FRP2 100.M FRP2 100.M INP2 100.L INP2 100.M INP2 100.M INP2 100.M INP2 200.L INP2 200.M INP2 200.M INP2 200.M INP2 200.M

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22-1 22-2 23-1 23-2 24-1 24-2 25-1 25-2 26-1 26-2 27-1 27-2 28 29-1 29-2

ISO2 100 ISO2 100 PAI2 100 PAI2 100 PAI2 200 PAI2 200 SAN2 100 SAN2 100 SAN2 200 SAN2 200 SAN2 300 SAN2 300 WOD2 100 WOD2 200 WOD2 200

Bathrooms Proofing Bathrooms Proofing Painting Preparation Layers Painting Preparation Layers Final Painting Layers Final Painting Layers Sanitary Pipes Sanitary Pipes Potable Water Piping Circuits Potable Water Piping Circuits Install of Sanitary Fixtures Install of Sanitary Fixtures Windows & Doors Sub-Frames Installation Windows & Doors Installation Windows & Doors Installation

02d 02d 06d 06d 12d 12d 20d 20d 09d 09d 06d 06d 07d 10d 10d

ISO.MEN INSULATI PAINTMEN PAINTMAT PAINTMAT PAINT BLUMBER SAN.PIPE BLUMBER IRON.PIP BLUMBER SAN.FIXT

L M L M M L L L L L L M

ISO2 100.L ISO2 100.M PAI2 100.L PAI2 100.M PAI2 200.M PAI2 200.L SAN2 100.L SAN2 100.L SAN2 200.L SAN2 200.L SAN2 300.L SAN2 300.M WOD2 100.L WOD2 200.L WOD2 200.M

DOORCARP L DOORCARP L MOS.DOOR M

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9. Analyzing Resources & Costs
Objectives:
 Verify a “Gantt Chart” is displayed in the top Layout window.  Display a “Resource Usage Profile” in the bottom Layout window.

 Format the Timescale to display a Date Interval once of
“Year/Month” and once of “Month/Week” or “Week/Day”.

 Adjust the Timescale to view the Date Range of the entire Project.  Verify that only the Resources assigned to the Case Study are displayed in the “Resource/Role” Hierarchy.  Hide the Legend in the Resource Profile.  Display the resource called “Cement” Profile.  Rsolve the “Over-Allocation” of all Over-Allocated Resources.

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Resolve Resource Over-Allocation:
All of the following Resources are over-allocated and the over-allocation resolved (for simplicity) by the suggested “Max. Units /Time”: Unit of Suggested Measure Max. Units /Time SM 1200 SM/d Ton 70 Ton/d Part 90Part/d SM CM Ton 600 SM/d 150 CM/d 18 Ton/d

Resource 1 2 3 4 5 6 BrickMat Cement Light.Fixation Mosaic Sand R.F.T

 By this manner, the project becomes optimized. Hint: Many waysto resolve Resource-overallocation o There is what we call Resource-Leveling, and o Activities Relationships

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10. Optimizing the Project Plan
Verify that the Projeect Plan meets the Project Stakeholders’s Dates, Resource, and Cost Requirements.

 Shorten a Project Schedule o The most important date in the schedule is the calculated
Project Finish Date.

o If the calculated Finish Date of the Project is behind the
required Project Finish Date, the Project must be shortend. In addition, each deliverable in the Project should be scheduled to finish by the dates imposed by the Project stakeholders.

 It is required for our case that the Project must finished by 01-Sep11. However, the scheduled indicates that the Project will not finish until 29-Sep-11.

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 Focusing on Critical Activities: o Click the “Setting” tab in the “Projects” window. o In the “Critical Activities” section, select “Logest Path”. o Go to “Activities” window. o Choose “Filter…” from the “Layout Option Bar”. o Check “Critical” and press OK as shown:

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o Decrease the Duration of Activity “FRP2 100” from 21 days
to 14 days, the Project Schedule Finish Date becmes 08-Sep-11.

o Add a Successor Actvity “ELE2 300” to “ELE2 200” with
Relationship type “SS” and “Lag time = 1”, the Project Schedule Finish Date becmes 20-Sep-11.

o Decrease the Duration of Activity “ELE2 300” from 14 days
to 13 days, the Project Schedule Finish Date becmes 14-Sep-11.

o Decrease the Duration of Activity “INP2 100” from 20 days
to 14 days, the Project Schedule Finish Date becmes 06-Sep-11.

o Decrease the Duration of Activity “PAI 200” from 12 days
to 10 days, and

o Decrease the Duration of Activity “WOD2 200” from 10
days to 7 days, the Project Schedule Finish Date becmes
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01-Sep-1 as shown:

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Cost Report Using Cost Account:
 Click “Tools/Report Wizard”  Choose “New Report”  Select Subject Area: Cost Accounts

 Select Additional Subject Area: Activity Resource and Role
Assignments  Columns: o Cost Account ID o Cost Account Name o Cost Account Description

o Labor Cost o Nonlabor (Equipment) Cost o Material Cost o Total Cost  Continue…

 For Cost Accounts: Use “Tools/Reports” to run the ready made report: o Report Group: Cost

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 Report Group: Control CC-01 Budgeted Cost by Cost Account

11. Baselining the Project Plan
 Creating BaseLine:
o o o

Open the Project “Case_15 --- BaseLining the Project Plan” In the “Project” menu, click “Maintain Baselines”. Verify the Project to which you are associating the Baseline “Case_15 BaseLining the Project Plan” is selected. Click OK.

o

o o o

Select the Baseline “BaseLining the Project Plan - B1” Type a new Baseline name “Base 1: Case_Target” In the “Baseline Type” drop-down-list, select “Initial Plan”

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 Assigning a BaseLine:
o o

Click “Project/Assign Baselines…” In the opened dialog box, select “Base 1: Case_Target” in both “Project Baseline” & “User Baselines – Primary” fields. Click OK.

o

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 Viewing Baseline Bars & Bar Style:
o o

In the “Layout Option Bar”, click “Bars”. Mark the check boxes next to “Primary Baseline” & “Baseline Milestone” Click OK. Notice the Baseline Bars appears in the “Gantt Chart”. Save this Layout with the name “Current vs. Baseline Bars”

o o o

Bar labels:
o o o o o o o

In the “Layout options Bar”, click “Bars”. Highlight a bar, “Current Bar Labels”. Click the “Bar Labels” tab. In the “Label” column, replace “Activity Name” with “Finish” Click “Add”. In the “Label” column, select “Total Float”. Click OK.

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12. Project Execution & Control
 Once the Project Information has been distributed, the next step is to
update the Project with Actuals.

 Information has been distributed about the Project. The Project has
started. You have gathered information from the Team Members. You can now manually update the Activities and apply the progress to the Project.  Updating the Project: You may need to update daily, weekly, or monthly, depending on the length of the Project and how frequently you want to adjust your forecasts.

 How Data is Collected? o Project Managers manually enter the Actual Date, Resource,
and Cost Information.

 Record Actual Dates and Progress, Actual Resource
Usage and Costs. o Approve and Apply Timesheets:

 Team Members use the Timesheets Module to update
Activities.

 Project Managers review and approve timesheets.  Project Managers apply timesheets to the Project.  Data Date: o The Data Date is the date up to which Acual Performance
Data is reported and the Date from which future work is scheduled.

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 Updating Process: o Create a Baseline Plan.
o Enter Activity Progress.

o Use Suspend & Resume Dates as necessary. o Apply Actuals to the Project o Perform Target Analysis:  Compare the Current Plan to the Target Plan to analyze
variances. o Determine whether Project Objectives are being met:

 Will the Project finish on time?  Are Project Resources being used effectively?
 Use the following Activity Progress:
o

Actual Data is usually different from Planned Data. It is the real Time/Cost associated with an Activity. Record Actual Information for the Project using the Actual Data coming from the Site,

o

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Act ID ADM2 PRP2 CO22C100 CO22C200 CO22C300 CO22C400 CO22S100 CO22S200

Act Name Project Administration Preparing Project Requirements & Analysis FormWork (Columns) RFT (Columns) Cast-in-Place Concrete (Columns) Curing Time for Columns FormWork (Slab/Stairs) RFT (Slab/Stairs)

Dur 170 10 7 4 3 5 10 7

AS 1/1/11 3/1/11 4/1/11 8/1/11 13/1/11 19/1/11 24/1/11 30/1/11 …

AF

Expected Finish

PCT

17/1/11 11/1/11 12/1/11 16/1/11 25/1/11 10/2/11 80.0

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 Remember that The Earlist Completion Date of the Projerct was
01-Sep-2010.

 Drag the “Data Date” to the morning of 01-Feb-11 as shown:

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Entering Actuals:
 For Completed Activities:
o Actual Start & Actual Finish Dates o Actual regular Units/Costs o Actual Expense Costs

 For Activities In-Progress:
o Actual Start Date o Suspend and/or Resume Dates o Percent Complete and/or Remaining Duration o Expected Finish Dates o Actual regular Units/Costs and Remaining Units/Costs o Actual and Remaining Expense Costs

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 Resheduling Project & Viewing the Results:

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 Controlling the Project: o It seems that the Project is behid the target by 7 days.
o Repeat the process of solving this problem as mentioned before.

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13. Reporting Performance
In this section, We demonstrate how to run & create Tabular Reports as a means of reporting performance information.

 Describe Reporting Methods  Run a Schedule Report  Create a Resource Report with the Report Wizard  Create a Report using the Current Layout Methods for Performance Reporting:
There are many methods to distribute Schedule, Resource, and Cost Performance Information to Project Team.

1. Open the Project, Case_15. 2. From the “Directory” bar, click “Reports” 3. Locate a Report Group Title Band, “Schedule”. 4. Highlight the report “SR-03 Schedule Report with Activity
Budget”

5. In the “Command” bar, click “Run Report”.
Hint: When you see the report, right-click and choose “Save As --image.jpg”

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Report Wizard
You can report “Resource Assignment” by creating and printing a “Resource Report” in the “Report Wizard”.

1. Click “Reports” from “Direcory” bar. 2. On the “Command” bar, click “Add”, the “Report Wizard”
displays.

3. Click “Next”

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4. Select a subject area, Resources. 5. Click “Next”

6. Select an additional subject area, Activity Notebook. 7. Click “Next”
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8. Select “Resources” 9. Click “Columns”. Choose Resource ID & Resource Name. 10.
Add a Filter to the Report:

1. Click “Filter…” and choose as shown

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2. Click Ok, the following window appears:

3. Type a descriptive report title: Case_15: Assigning
Resources to Activities

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4. Click “Next”, the following window appears:

5. Click “Run Report”.

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Creating a Report Using Current Screen:  The “Report Wizard” can also be used to create reports based on the
screen that is currently visible in Primavera.  This enables the User to easily create a wide variety of reports by basing them on the layout of the current screen.

1. 2. 3. 4. 5.

Navigate to the “Activities” window. Select & Modify the Current “Layout”. Click “Tools/Report Wizard”

In the “Create or Modify Report” window, select “Use Current Screen”. Continue as usual….

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References
Project Management Institute, A Guide to the Project Management Body of Knowledge PMPOK Guide, 2000 Edition Joseph Phillips, Project Management Professional (PMP) Study Guide Premavera P6 Project Management Reference Manual Abdalla ElDaoushy Projects Time Management & Controlling using Project Management Software, Dec. 2008, Institute of National Planning, Cairo, Egypt

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