Chapter No.

Introduction to Project Management

Introduction:

This chapter introduces the process of project initiation and concludes by discussing the
underlying causes of success in projects now and in the future. For facilitate an understanding
of the nature of “Projects” and the role of “Project Management” its first necessary to
confirm the accepted meaning of these terms.

Project:

A project is a complex, non-routine, one-time effort limited by time, budget, resources, and
performance specifications designed to meet customer needs. Like most organizational effort,
the major goal of a project is to satisfy a customer’s need. Beyond this fundamental
similarity, the characteristics of a project help differentiate it from other endeavors of the
organization.

The major characteristics of a project are as follows:

1. An established objective.

2. A defined life span with a beginning and an end.

3. Usually, the involvement of several departments and professionals.

4. Typically, doing something that has never been done before.

5. Specific time, cost, and performance requirements.

What a Project is not:

A project is not an everyday, routine and repetitive work. A project is only done once.

When the project is done, a new product or service exists.

 Programs versus Projects

 Terms are often interchanged

1
  Both are directed toward goals and require plans and resources to reach their goals
 Both use similar tools, methods, policies
 Differences lies primarily in scope and time horizon

The Project Life Cycle:

Another way of illustrating the unique nature of project work is in terms of the project life
cycle. The lifecycle recognizes that projects have a limited life span and that there are
Predictable changes in level of effort and focus over the life of the project. There are number
of different life-cycle models in project management literature. Many are unique to a specific
industry or type of project. The project life cycle typically passes sequentially through four
stages: defining, planning, executing, and delivering. The starting point begins the moment
the project is given the go-ahead. Project effort starts slowly, builds to a peak, and then
declines to delivery of the project to the customers.

1. Defining stage: Specifications of the project are defined; project objectives are
established; teams are formed; major responsibilities are assigned.

2. Planning stage: The level of effort increases, and plans are developed to determine what
the project will email. When it will be scheduled, whom it will benefit, what quality level
should be maintained. And what the budget will be.

3. Executing stage: A major portion of the project work takes place---both physical and
mental. The physical product is produced (a bridge, a report, a software program). Time, cost,
and specification measures are used for control. Is the project on schedule, on budget, and
meeting specifications? What are the forecasts of each of these measures? What
revisions/changes are necessary?

4. Delivering stage: Includes the two activities: delivering the project product to the
customer and redeploying project resources. Delivery of the project might include customer
training and transferring documents. Redeployment usually involves releasing project
equipment/materials to other projects and finding new assignments for team members.

2
The Challenge of Project Management

1. Manages temporary, non-repetitive activities and frequently acts independently of the

formal organization.

 Marshals resources for the project.

 Is linked directly to the customer. Manages customer expectations and what is
reasonable and feasible.
 Provides direction, coordination, and integration to the project team, who are
functional participants
Is responsible for performance and success of the project (frequently with little authority)?

2. Ensure appropriate trade-offs are made between time, cost, and performance.

3. Generally only possess rudimentary technical knowledge

4. Must induce the right people at the right time to address the right issues and make the right
decisions.

The Importance of Project Management

Becoming a standard way of doing business because of

 Compression of the product life cycle

 Global competition
 Knowledge explosion
 Corporate downsizing
 Increased customer focus
 Rapid development of Third World and closed economies
 Small projects that represent big problems

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 Chapter No. 2

Project Management & Construction Planning

Introduction

The essential focus of a construction company is its field projects. These are, after all, the
heart and soul of any such business enterprise. If a project is to be constructed within its
established budget and time schedule, close management control of field operations is a
necessity.

Project conditions such as technical complexity, importance of timely completion, resource

limitations, and substantial costs put great emphasis on the planning, scheduling, and control
of construction operations. Unfortunately, the construction process once it is set into motion
is not a self regulation mechanism and requires expert guidance if events are to conform to
plans.

Projects are one time and largely unique efforts of limited time duration, which involve work
of a non-standardized and variable nature. Field construction work can be profoundly
affected by events that are difficult, if not impossible to anticipate. Under such uncertain and
shifting conditions, field construction costs and time requirements are constantly changing
and can seriously deteriorate with little or no advance warning. Skilled management effort is
not only desirable, it is absolutely imperative for a satisfactory result.

The Management Cycle:

Project management has two major phases that are as follows:

Planning

Control

 The planning phase includes:

 To establish project objectives
 To define the work

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  To determine the timing
 To delineate project organization/ team
 To establish resources requirements / availability
 To establish a cost baseline
 To evaluate, optimize, and freeze baseline plan
 The control phase includes”
 To track work progress and actual costs
 To compare progress and costs to baseline
 To communicate project goals
 To evaluate performance
 To forecast, analyze and recommend action

Planning Stages:

The process of planning can be divided into the following three phases

 Pre-tender plan
 Pre-contract plan
 Contract-Plan

1. Pre-Tender Planning:

The timer available for pre-tender planning may vary between six and eight weeks,
depending upon the type of project. While the contractor knows that he may not win the
tender, resources in terms of time and personnel must nonetheless be made available to
ensure that a competitive tender is submitted. The contractor depends upon a certain number
of tenders being successful in order to say in business.

During this phase, the contractor will decide on the construction strategy and produce a pre-
tender report. To achieve this, the planning teams just study the contract documents and visit
the site.

The study of the contract documents should highlight any discrepancies in the document, any
unusual clauses in the contract, any special or unusual construction details, and any unusual

5
item in the specification or Bill of Quantities. The visit to the site should reveal the following
details:

 The exact location of the site

 The access to the site
 Details of services
 Geography of the area
 Local knowledge about the site
 Location of tips in relation to the site
 Local availability of labor
 Local availability of material and plant
 Local weather conditions
 Whether any construction work is commencing or completing in this area
 Condition and closeness of surrounding buildings

Checklist of Pre-Tender Planning

 Tender summary
 Correspondence file
 Site inspection report
 Method statement
 Outline construction program
 Outline organization structure Subcontractor lists
 Supplier’s quotations
 Cost breakdown
 List of site layout
 Requirements
 Health and safety plan

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2. Pre-Contract Planning:

If a contractor is successful in obtaining the work, the process of pre-contract planning can
commence. During this second phase the initial method statements and outlines program are
analyzed in detail with a view to converting them into working document which can be used
for monitoring and control purposes.

At this stage, the timing of activities is set together with a reappraisal of the sequencing of
activities that was put forward at pre-tender stage.

The mechanics for the awarding of contracts to the suppliers and subcontractors is put in
place, with the contractor seeking to obtain better terms and conditions now that the works
are certain. A detail site layout is prepared to show the arrangement of site accommodation,
material storage and plant in a manner, which will enable the work to be carried out
effectively and efficiently.

The site organization structure should now be formalized, naming the key site personnel and
showing the lines of reporting between people and groups. Site services such as water,
electricity and telephone can now be confirmed with the relevant bodies and connection dates
identified.

Materials that have long delivery periods may need firm ordering at this stage even though
the contract commencement date may be some time away.

Checklist of Pre-Contract Planning Document:

 Correspondence file
 Sub-contractor’s file
 Supplier’s file
 Method Statements
 Site layout plan
 Organization structure
 Master construction program
 Labor resource schedule
 Material schedule

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  Plant Schedule
 Health and safety plan
3. Contract Planning Phase:

This phase of the planning process takes place during the construction period and involves
planning processes that are essentially short term.

The site manager must now break down the master program into monthly and weekly sub-
programs. Increasing amounts of detail are now required to ensure that activities take place at
the correct time and in the correct sequence.

Up will be made of the method statements and programs to allocate specific tasks to
the labor force on a weekly or daily basis. The site manager will issue daily allocation sheets
that will list the tasks to be undertaken. An important aspect of the contract planning phase is
the exercise of monitoring and control activities to ensure that the project is running
smoothly.

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 Chapter No. 3

Salman & Co. Construction Company

Introduction:

This chapter tells us about the brief introduction of SALMAN & CO. Construction Company
its management hierarchy as well as the current activities of the company have been
discussed.

VISION

“Salman & Co. Construction Company has a vision to be the most sought-after contractor for
difficult projects in which meeting the challenges of execution, safety, and schedule set us
apart from our competition.”

MISSION STATEMENT

“Our mission is to achieve consistent profitability by offering value to our Customers and
exceeding their expectations by providing well organized products and services, in all over
the country.”

Our Values

 Integrity : Maintain constant adherence to a strict moral and ethical code

 Honesty: Uphold truthfulness and fairness in dealing with others
 Professionalism: Conduct ourselves as dedicated
 Accountability: Hold ourselves responsible for our daily craft
 Respect: Appreciate and treat all individuals with courtesy and dignity
 Team Work: Cultivate a climate to encourage a cooperative effort
 Excellence: Strive to do better than ordinary

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OUR STRENGHTS:

• Highly professional team with years of experience

• Well organized and comprehensive set up

• Highly creative and cost effective

• Immaculate track record

About Us:

SALMAN & CO. CONSTRUCTION COMPANY has come a long way since our humble
start in 2001.Such phenomenal expansion in such a short time period has been achieved
through hard work, devotion to the cause and sincerity to the organization by our work force
and management .In FY 2003-2004 our turnover stood at approximately Rs.5 million while in
FY 2005-2006 we crossed Rs.250 million. We competed with the biggest names in the
business and our finished works drew praise from our clients on most challenging projects.
Their growing confidence in our abilities can be judged from the list of works accomplished
so far.

Right Now Salman & Co. Construction Company is actively engaged in major projects in
Punjab, Sindh and Northern Areas with diverse nature projects including, gas pipeline laying,
civil works, expansion of Karakorum highway. Town development works, major engineering
works like building of spillways and much more. We believe in quality work, always to the
satisfaction of our patrons and expect our dedicated work force to achieve even higher levels
of excellence, exemplary quality of work and maximum output through flexible planning and
efficient management. Our on –going projects including lying of gas pipelines in the Sindh
and the expansion of the Karakorum Highway from China Boarder to the Taxila, and the
making the technical feasibility of the Diamer Basha Dam. So far we have worked with many
corporate societies and leading architects and have successfully completed small as well as
big projects. We always strive to offer the best of our services to our customers with a
commitment to deliver value for every rupee they invest.

10
 Chapter No. 4

Defining the project

Background of Project:

The construction of office building for Friends & Company having Capital cost of Rs. 21s0
million was approved by the owner on 01-01-2011.

Justification of Project:

Expenditure on rent of buildings

The current expenditure on rent of hired office building for Friends & Company is about Rs.
22.106 million per annum, which is increased @ about 30% after every three years.

Problems of Coordination:

Locations of offices/sections in different buildings poses problems of effective coordination

of activities and regular consultants amongst sections , unnecessary loss of time , which effect
overall efficiency of these organizations. Travelling between different buildings and cities
also result in an unnecessary expenditure on the exchequer.

Security Problems:

Private buildings pose security problems as these are located in commercial markets.

Deficiencies in existing buildings:

They hired buildings constructed mainly from commercial point of view, are not suitable to
house office, particularly the costly computer equipments and printing press. These buildings
are also open to vagaries of weather as the rain/sewerage water gushes into basements very
frequently and destroy not only office record but other costly store items too.

Objectives of Project

1- To Construct office Building on Plot no. 21(measuring 175’ * 300’,

52500SFT=5,833.3 Sq.Yds=9.6 Kanals) in Mauve Area of Sector G-9/1 Islamabad.
2- To save precious exchequer (millions) of Company being paid for rent of hired
buildings for Friends & company.

11
 3- To provide permanent accommodation for offices of Friends & Company.
4- To provide latest facilities i.e. split type AC, fire fighting system, glass/wooden
partition, false ceiling, lifts, diesel generating set, water filtration plant etc in the
building.

Impact and Benefits of Project

Following are benefits of project:

Financial: there will be no direct financial benefit however the expenditure being
incurred on rent of the hired buildings will be saved.

Economic: Economic measure are being taken in implementation of the project and on
completion

Contributions

Management structure and man power requirements including specialized skills during
construction and operational phases.

Sponsoring: The project will be sponsor by Friends & Company.

Execution: The execution responsibility of the project is held with Salman & Co.
Construction Company Islamabad.

Operation and maintenance: is also looked by Salman & Co.

Project Deliverables:

The major deliverables in the project is to successfully construct Office building for Friends
& company can continue their services under one roof and provide full commitment to their
responsibility. Since major deliverables are the core success factor for the project so they
should be ensured.

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Building Specification

General Requirements:

1 Committee/Conference Room
2 Library
3 Confidential/record room
4 Store for stationary stock
5 Waste rooms
6 Telephone and IT section
7 Printing press Or Training rooms
8 Canteen
9 Prayer hall
10 Data entry hall
11 Computer room/labs
12 Terminal room
13 Store for computer stationary
14 Data control/data stores
15 Tape libaray
16 Reception (4 rooms)
17 Space reserve for staff future use
18 Staff &officers rooms

Project Staff

The staffs which are required for the execution of project are as follow.

1- Professional and Technical Personnel.

2- Skilled Labor
3- Un-skilled labor

Budget

The total capital costs estimates are 210 millions. The estimation is based on present market
survey for such type of buildings.

Project duration

The duration of the project is 515 days or 17 month and if we exclude the 70 holidays during
this period, then the total estimated time for the completion of this project are 445 days or
almost 15 months or 1 year and 3 months.

Starting Time

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Its official starting was 10 January 2011.

Ending Time

Its completion time is 31st March 2012

Project Manager

Mr. Salman

Responsibilities of Project manager

Because of his waste and diverse knowledge and the experience of Mr. Salman the other
partners decided to give the responsibility of this construction project. He has all the
authorities to do the work in the way his want rest of the members will not interfere and will
not question about the construction except providing them the finance details.

Team Heads

These are the main heads of construction team under them they also have their team

• Market research team

• Civil engineer

• Lawyer (Legal documents)

Project Team Strategy

As per our requirement our team had work with them. Our group strategy was that the
designations which they people had in their team we also had each designation allotted to the
individuals of our group.

Project Manager

Mr. Salman

Team Members

MR. Rizwan & Mr. Amir (Market Researcher)

14
 Mr. Muazzam & Mr. Kamran (Civil Engineer)

Mr. Raja Sajid (Lawyer)

Expertise and duties of team members

Market research team duties

• The area is suitable of Building

• For 15 days observe the condition of other similar buildings

• Finally they have to decide that which place is suitable for the project

• Making feasibility

When market researchers gave there repot to owner and tell them the best suitable place from
where they can easily construct the building and provide them the feasibility reports. So
because he the work is done by the company so there is no need for the tender because
company manages all the activities own self. That company sent his civil engineer on the site.

Civil Engineer duties

• Deign of site

• Installation of plant

• Check the ground during flooding or high water condition

• Refueling system

• Operation of gasoline system

• Filling up system

• Dispersion unit

• Design the flow lines

Plumber duties

• Establishment of pumps

15
 • Water level

• Water volume

Lawyer

• Lawful working and documentation

They all are liable to report to project manager Mr. Salman

Project Frame Work

Meeting Schedule
Level Hierarchal Breakdown Structure Description

The meeting will be conducted at every weekend on Saturday to discuss each and every
development. During the meetings the time and cost and the progress of project will be
discuss. The project manager will see and comment on each and every aspect of the project.

STEP 2: ESTABLISHING PROJECT PRIORITIES

• Set terms and conditions

• Signing the contracts

• Fulfill the legal requirements

• Ensure the precautionary measure on wok site

STEP 3: CREATING THE WORK BREAKDOWN STRUCTURE

1
Project Complete
Project

16
 Deliverables Major
2 Deliverables

Sub deliverables Supporting

3 Deliverables

Lowest
management
4 Lowest deliverables responsibility
level

Groping for
work packages
5
Cost Account for monitoring
progress

Work Packages
Identify work
activities

LEVEL 1

• Complete Project

This the last activity when the whole project will complete but it includes in 1st level. Our
project will complete after the 515 days of its start.

17
LEVEL 2

• Major Deliverables

Major Deliverables of our project is the 10 story building when finish before the renovation
and the transfer of documents.

• Supporting Deliverable

Supporting deliverables is the raw form of stories of the building where the speedway
company can shift their things which is necessary to shift first. Work of electrical system can
be managed along with this.

LEVEL 3

• Lowest Management Responsibility Level

It is the responsibility of the middle line managers to control and monitor all the activities to
ensure the designed task objectives, cost and time

• Grouping of work Packages for monitoring Progress and Responsibility

At those level we combined the different same activities and assigned these tasks to different
teams and then Avery manager of that tem monitor or inspect that activity either it is going to
the right way.

Work Breakdown Structure

In this project followings are the identifiable work actives at different stages of the project

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No Type of Task Description of Task

1 Main Task Approval

2 Main Task Budgeting

3 Main Task Design

4 Main Task Acquire Resources

5 Main Task Site Work

5.1 - Earthwork and utilities

5.2 - Paving

5.3 - Walk and miscellaneous site work

6 Main Task Building the foundations

6.1 - Digging

6.2 - Build small tunnels for electricity, gas, water, and drain lines

6.3 - Pillar construction

6.4 - Concrete Foundations

6.5 - Steel Erection

6.6 - Filling the foundation

7 Main Task Construction of Basement

7.1 - Structures

7.2 - Plumbing

7.3 - Electrical

7.4 - HVAC

7.5 - Roofing

8 Main Task Construction of 1st floor up to Roof (2nd

floor)

8.1 - Structures

8.2 - Plumbing

8.3 - Electrical

8.4 - HVAC

8.5 - Roofing

19
9 Main Task Structure and miscellaneous steel

10 Main Task Wood and plastic

10.1 - Rough carpentry

10.2 - Finish carpentry/wood floor

11 Mani Task Thermal and moisture protection

12 Main Task Roof and accessories

13 Main Task Gutters and downspouts

14 Main Task Doors, windows, glass

14.1 - Windows and storefront

14.2 - Door hardware

15 Main Task Finishing

15.1 - Drywall

15.2 - Painting

15.3 - Acoustical Ceilings

15.4 - Floor Covering: Carpet

15.5 - Floor Covering: Ceramic, Vinyl, Base

16 Main Task Specialties

16.1 - Hardware Equipments, Furnishing & Special Construction

17 Main Task Mechanical Systems

17.1 - Plumbing

17.2 - Fire Protection

17.3 - HVAC

18 Main Task Conveying Systems (Elevator)

19 Main Task Electrical System

20 Main Task Transfer of Documentation

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STEP 4: Integrating the WBS with the organization

1. Acquisition of land

This construction Company has the policy that the either the land provided by the owner of
the building who want to construct their building either company purchase the building on the
behalf of the owners where they want.

In this project the land is provided by the owner of Speedway Company in Rawalpindi and
Islamabad, that is why the cost of the land is not included in the total cost of the project.

2. Approval/ Legal Requirement

It is the policy of the company that it fills full all the legal requirement of the project before
start the project. In this project all the legal documents have signed by both the parties which
tells all the terms and conditions.

3. Budgeting

Company also signed another document which tells that speedy company will provide all the
budget of the company and in case of inflation or other happing of other unusual events the
company will provide more budgets.

4. Site Office

Company will construct a small office in site work where they manage and integrate all the
activities of the project

5. Quality Insurance

Company will use the standard material and ensure the quality in time and construct the
whole building specially the foundations according the international standard

6. Control

21
Company will control and monitor all the project so that all the activities of this project can
be completed on Time Company will also adopt the precautionary measures to provide the
safety to labor and prevent from other damages like fire, equipment damagers etc.

7. Transfer of Documentation

At the end of the project Salman & Co. Company transfer the document and release resources
within the committed time.

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 Chapter No. 5

Estimating Project Time & Costs

Introduction

This chapter tells the project time and cost estimated for the whole project and also tells us
that how company use our financial resources.

Project Parameters

Scope Statement

The construction of office building for Friends & Company having Capital cost of Rs. 260
million was approved by the owner on 01-01-2011.

Project duration

The duration of the project is 515 days or 17 month and if we exclude the 70 holidays during
this period, then the total estimated time for the completion of this project are 445 days or
almost 15 months or 1 year and 3 months.

Starting Time

Its official starting was 10 January 2011.

Ending Time

Its completion time is 31st March 2012

Project Deliverables:

The major deliverables in the project is to successfully construct Office building for Friends
& company can continue their services under one roof and provide full commitment to their
responsibility. Since major deliverables are the core success factor for the project so they
should be ensured.

23
Assumption of normal conditions:

Before estimates our costs for this project, we assume the normal conditions in the country
which represents all the political and economical conditions are normal and these cost
estimates are according to it.

Cost of land:

This construction Company has the policy that the either the land provided by the owner of
the building who want to construct their building either company purchase the building on the
behalf of the owners where they want. The cost of Land is equal to 43000000 rupees.

In this project the land is provided by the owner of Friends & company in Islamabad, that is
why the cost of the land is not included in the total cost of the project.

Types of Costs:

Direct Costs: Rs. 158,900,000

General and Administration Overhead costs: Rs. 3,000,000

Total Rs. Rs.161,900,000

Refining estimates and contingency funds:

Project manager will inspect all the activities to control the cost and there also reserves or Rs.
5,000,000 for the contingency funds which can be used for contingency fund in case of any
unusual event happened.

24
 Chapter No.6

Literature Review

1- Building sustainable relationships in project teams:

Article Abstract:

A project manager's priority is always to deliver the project on time and on budget (or for less
and earlier!). We all know project management has many facets, parts of which are the
processes and standards; however without the people in the team, and the wider organization,
a project will never be delivered.

Project teams are a microcosm of the organization bringing with it the challenges of multiple
cultures, possibly from different parts of the World and certainly other parts of the
organization, disparate skills, expertise, knowledge and different levels of seniority.

Summary:

In this article the writer told us that a project manger’s priority is always to deliver the project
on time and on budget (or for less and earlier). Project management has many parts which
have the important processes and standards; however without the people in the team, and the
wider organization a project will never be delivered.

(By Patrick Brid)

2- Cutting-Edge project management: what game theory and poker can teach us :
In this article the author told us that as project management continues to grow around the
world and become increasingly commoditized, more specialization will be necessary in order
to secure the best opportunities. One of these areas of specialization that will have increased
demand in the future will be the risk management of projects. For this purpose he had
indentified few things which are how to measure and acquire information, measuring risk,
estimating the resources, calculating the value of information, choosing alternatives with
positive expected returns.

By (Gil Junqueira)

25
 3- Project Management and its impact on IT project success:

Abstract:

When dealing with IT projects, using specialized project management techniques will be very
beneficial to your ongoing progress leading to a much higher success rate in the long run.
Planning and carrying out IT projects can be tricky for a variety of reasons, making the
ability to complete them successfully a very valuable asset to any employer.

Summary:

In this article when dealing with IT projects, using specialized project management
techniques will be very beneficial to your ongoing progress leading to a much higher success
rate in the long run. Planning and carrying out IT projects can. Be tricky for a variety of
reasons, making the ability to complete them successfully a very valuable asset to any
employer.

By (Cluadia Vandermilt)

4- Risk Management:
In this article the author told us that risk management is the heart and soul of project
management. Failing to practice it right can have fatal consequences on projects and
programs. Doing real effort in the planning stage can save the entire investment and will
increase the likelihood of project success, however, planning alone is not enough if
monitoring risks not handled seriously.

By (Kareem Shaker)

5- What Are Project Health Checks?

By Michael L Young

27, Nov 2011 

Summary:

This article is all about the health project and its issues which faced by the manger during the
processing of project. Project managers, sponsors and the project team are frequently so

26
involved in the daily activities that they can fail to recognize the true status of a project. The
purpose of assessment to get knows of how well the project is performing in accordance with
its objectives. It is well known that in most business grounds, the cost of correcting an issue
is many times the cost of preventing it. There are two ways you can approach project the
checks: (1) identify the trouble and (2) proactive checks ensure it will work efficiently. Here
also give Five broad categories of warning signs that are pretty common for organizations
that successfully use health checks to identify problems these are Project control,
Compliance (adopting a consistent approach to practicing project management), Validating
the business case (customer satisfaction, new product), Risk and problem review (check
examines the risk management plan, identifies top ten risks), Human factor (relationships
among the various project stakeholders). The next step is that can manger make a rescue for
these identify the problems. The health check includes assessment of: Scope (initial
definition), Cost (projections and variations), Time (use of milestones), Quality (quality
review actions), Resources (proper allocation of all resources), Risks (mitigation strategy
effectiveness), Contingency Planning (robustness of contingencies), Benefits (review of
projected benefits), Training (existence of training plan) and Implementation (existence of
implementation plans, launch support, authorization).

6- The Seven Deadly Sins of Risk Management

By Kareem Shaker, PMP

26 Sep 2010 

Summary:

Risk management is the heart and soul of project management. Failing to practice it right can
have fatal consequences on projects and programmes. Doing real effort in the planning stage
can save the entire investment and will increase the probability of project success. However,
planning alone is not sufficient if monitoring risks is not handled seriously. These are seven
points of risk management and how to take defensive actions to avoid them. i Disregarding
Enterprise Risk Management (processes to identify and manage enterprise risks of all types,
such as operational, strategic, financial and study what threats the organization is likely to
encounter during the projects' lifetime), ii Using Incomplete Risk Breakdown Structure
(channel to identify large numbers of risks), iii Ignoring Subjectivity (can make risk
management lose its real meaning), iv Assigning Risks to the Project Manager (risk
27
management can never be a one-man power. The risk management team has to set clear
expectations and inform to experts, stakeholders, team members of what is expected from
them), v Neglecting Risk Cost Analysis (Risks have to be accepted for two main reasons; first
is unfeasibility of the first three response strategies, and second is due to unfavorable benefit
cost analysis), vi Misusing Contingency Reserve (The contingency reserve should not be
used for any unplanned risk it can only be handled by the management reserve), vii Doing it
once (It is not right to do it inception during the planning stage only it makes on every stage
of project)

7- Reducing Your Cost of Quality

By Alan S. Koch, PMP

16, Oct 2010 

Summary:

Your engineers spend time in diagnosis and revise, development schedules slip, support costs
scale, and your company's and products' reputations sink. These Failure Costs, which are the
more significant Cost of Quality, are beyond your direct control. But you can gain control
over them indirectly, by investing in Appraisal Costs that minimize Failure Costs, reducing
your total Cost of Quality and making it more predictable. The Cost of Quality is a significant
cost on any project, so careful managers look for ways to keep those costs in check. The
Quality costs we can control are things like performing reviews, preparing tests. Failure costs
take many forms like; slips in our schedules, as testing uncover defects that require rework,
our customer support costs, loss of customer good will, tarnished reputation in the market,
and loss of product momentum. Most organizations depend upon the compiler and various
types of testing to remove most or all of the defects from their products. But these are not the
most effective methods of removing defects. They each tend to detect no more than 50% of
the defects in the product, and often do much worse than that. In addition, they happen late in
the project life cycle, when defects are the most expensive to fix. These activities are
classified as 'Failure Cost of Quality' because the vast majority of the time is spent dealing
with failures. The only way to be in control of our total Cost of Quality is to shift it from the
uncontrollable Failure Costs to the controllable Appraisal Costs. With each incremental
increase in Appraisal activities like reviews (assuming they are done well), we can expect a
parallel and larger reduction in our Failure activities.
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 Chapter No.7

Risk Management

Risks Involved in Construction Site Accidents:

While almost any type of workplace can offer unexpected accident risk, it is the
responsibility of the employer to take action to keep that risk as low as possible. Construction
sites may seem to be more hazardous than an office building or store, but accidents and
dangers can be prevented by implementing rigid and enforceable safety practices at
construction sites. For example, the general contractor and all subcontractors are required to
provide a reasonably safe site, to warn of hazards inherent in the site and work, to hire careful
employees, to coordinate job safety, and to supervise compliance with safety specifications.
In addition, construction site workers should be properly trained in the operation of
machinery and equipment. The construction site should also be properly managed according
to legal standards to prevent construction site accidents.

Even with precautions and adherence to safety practices, construction site injuries can still
occur due to the inadequacy of these provisions. Accidents involving defective or collapsing
scaffolds can result in construction site accident cases; falls off of or through roofing
structures; electrocutions; falls off of ladders; defective machinery such as cranes, hoists,
conveyors, tractors, and forklifts; malfunctioning tools and other construction equipment; and
the collapse of floors or walls. These types of construction site accidents can often result in
serious injuries or death. In fact, thousands of construction workers are injured or killed in
construction site accidents each year.

Construction Site Accidents and Workers' Compensation

Virtually all significant injuries suffered in construction site accidents give rise to workers'
compensation rights. The Workers' Compensation Act provides benefits to workers who are
injured on the job. Unfortunately, Workers' Compensation alone may be insufficient
compensation especially in the case of very serious and catastrophic personal injuries which
happen often in construction site accidents. The rights are dependent on the interpretation and
application of several complicated laws and individual circumstances of the construction
accident.

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However, these limited workers' compensation rights may be supplemented by legal actions
against others who have responsibility for various activities on a construction site including
construction managers, general contractors, subcontractors, equipment manufacturers, etc.
When a construction site accident occurs, the owners, architects, insurance companies and
manufacturers of equipment can be held responsible for inadequate safety provisions.

As an example, in many construction undertakings, several different contractors are involved.

Full damages can be recovered if any contractor other than the direct employer has
responsibility for the injuries. Likewise, if a defective tool, machine, or other product causes
injury, an injured worker can be fully compensated.

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 Chapter No.8

Developing a Project Plan

Network Computation Process

Drawing the project network places the activities in the right sequence for computing

Start and finish times of activities. Network computation also tells us the critical path.

Completion of the forward and backward pass will answer the following question:

Forward Pass---- Earliest Times

1. How soon can the activity start? (Early start---ES)

2. How soon can the activity finish? (Early finish---EF)

3. How soon can the project be finished? (Expected time---TE)

Backward Pass----Latest Times

1. How late can the activity start? (Late start---LS)

2. How late can the activity finish (late finish---LF)

3. Which activity represents the critical path? (CP)

4. How long can the activity are delayed? (Slack or float)

Critical path

This is the longest path in the network which, when delayed, will delay the project. Critical
path can made among these activities which has zero slack time which shows that these
activities cannot be delayed

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Slack time

Slack time shows how long can the activity be delayed. Total slack or float for an activity is
simply the difference between LS and ES (LS-ES = SL)

The pages next to this show Networks computations of our project:

Legend for all these Network Diagrams

ES ID EF

ES SL Description

LS Dur LF

Critical Path

Critical path of this project is given below.

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Activity Description Preceding Activity Activity Time

A Approval NONE 15

B Budgeting A 15

C Design B 10

D Acquire Resources C 10

E Site Work D 25

F Build Foundations D,E,I,M 60

G Construction of Basement F 25

H Construction of 1st to 10 floor G,I 100

I Structure & miscellaneous steel work G, H 30

J Wood and Plastic work G, H 70

K Thermal and Moisture Protection G,H 10

L Roof & Accessories G,H 55

M Gutters and down glass works G,H, 8

N Door, windows and glass works G,H, K 62

O Finishing J,L,N 42

P Specialties (Hardware, Equipments, Furnishings) O 8

Q Mechanical System P 36

R Conveying System Q,S 14

S Electrical System H,I,L,O 20

T Transfer of Documents S,R 10

The above table shows the code/ ID for each activity, their description and the preceding
activity of each activity and the duration required to complete each activity. We also assume
the all the activities will be completed after the completion of Activity G & H.

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