International Enterprise

Project Management
Part 2
Risks – WBS - Planning - Scheduling - Tooling
Risk Management

⻛险
(feng xian)
Courtesy Li Yi

"Risk is like fire: If controlled it will help you;

if uncontrolled it will rise up and destroy you.“
(Franklin Delano Roosevelt, 1882 - 1945)
 Risk Definitions
1. Possible undesirable occurrence which could result
in a project not meeting one or more of its objectives
2. Negative deviation from an expected outcome (*)
3. Risk Management is the systematic way of thinking
and acting in the context of risks (*)

* W. Gleißner, courtesy Manuel Klein

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 What makes a project
complex and risky ?
1. Cultural change for individuals
2. Organisation will have to go
through a cultural change
3. New technologies involved
4. Many geographies or people
5. Many (sub)contractors

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 Risk Drivers
1. External : Introduced by factors outside the project
management (eg weather, social)
2. Induced : Introduced by bad planning or bad control
(eg requirements badly defined)
3. Intrinsic : Caused by the nature of the project and the
circumstances (eg New Technology)
4. Imposed : Contract Terms & Conditions can make
objectives unachievable (e.g. Performance)

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How to manage the risks in a project ?
1. Run a RIW (Risk Identification Workshop) with core team, sponsor,
technical gurus, specialists, using judgements, checklists or tools.
2. Brainstorm and quantify / assess Impact & Probability of each risk
3. Position the risks on a prioritization matrix
4. Evaluate the cost of action plans (contingency + mitigation)
and decide on a risk response for each action plan
5. Evaluate the consequent cost increase on the project
and get formal approval
6. Implement the risk actions within the WBS
7. Organise monthly risk reviews and update the plan as necessary

RIW RIW + regular reviews

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 Step 1 – Identify the risks,
evaluate probability & impact
before after
Proposed
Mitigation
action*
(reduce
Which Probabil Proposed Contingency impact after
Risk driver -(EXT, IND, Impact on ity action * (reduce probability Impact the risk
INT, IMP) project ? Level for the risk ho tappen) Level happened) Risk Owner
People are
wet & can’t
It may rain (EXT) work L N/A L Use raincoats Joe
Supply chain
Resources may not be may be
available (EXT) stopped H Outsource supply chain H N/A Mark
Train people
There is a new Project may on new
technology involved (INT) be in jeopardy H Use few new technology M technology Ralf
Quality may not be at Deliverables Implement
the right level (IND) may be poor M Implement ISO 9000 H ISO 9000 Stella
Add a clause
to
Volumes could be Customer transportaiton
greater than expected may lack contract for
(EXT) products M N/A (this is a positive risk) H flexibility Guillaume
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Latin: Contingentia – chance Mitigare – smoothen
 Step 2 – Position the risks
in a prioritisation matrix
Low Occurrence >> High
High

Resources
may not be
available

Quality
Impact >>

There is a new
technology involved Volumes could may not be
be greater at the right
than expected level

Attack those risks first

It may rain
Low

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 Step 2 – Position the risks
in a prioritisation matrix (Agile)

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Step 3a – Estimate the cost
of the decided action plans

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 Step 3b – Make decisions
We decide to We decide to
do this one transfer this We decide to
one NOT do this
one

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Hence the total cost associated to Risks : 308 K$
 More about… risk actions & plans
The decision to address a risk impacts the project :
• Scope
• Cost
• Duration
Each decided risk action :
• Is weighed in dollars/euros/…
• Is included in the WBS with all its related tasks
• Will be tracked as any other action/task
A risks may be shared with the Customer or not.
Other methods : Failure Mode and Effects Analysis (FMEA), based on
calculated factor : Severity * Likelihood of occurrence * Likelihood of
failure detection 12
 Assignment 2 : Risks
Use your existing project

1 - Run a RIW : Identify 5-10 risks

2 - Build the risk table (list of risks with occurrence and impact levels)
3 - Build the risks prioritization matrix to identify top risks
4 – Evaluate the cost of each action (contingency/mitigation)
5 - Make decision for each risk (ignore or act)
6 - Sum up the cost of selected actions => total costs linked to risks
7 - Present the table, the prioritization matrix, and comment top 3 risks

Preparation 60 minutes
Presentation 5’ : table, priority matrix, detail only top 3 risks)
Convince your audience(sponsor) that your team has a good risk
approach. S/he should understand this approach is part of the project.

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 What you learned
1. Zero risk does not exist
2. Risks Attitude : attack the risks before they attack you
3. Risks Identification Workshop
4. Risks Matrix / Risk Prioritization
5. Risks must be managed all over project duration

High Level Example: IBM IT Risks Strategic Priorities 2015

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 Time Management

Change Management
Video « Time Pieces »
 Distribution of effort
Resource

Proposal Delivery

Contract
Proposal Signed
Delivery
Signature

“in cauda venenum”

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Time
A project methodology for estimating
Step 2

Estimate tasks durations

Time

Step 1

define the scope (WBS)

Cost Functions
Step 3 To avoid missing tasks :
1. First define the scope.
Estimate costs
2. Afterwards, estimate time & costs.
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 Work time estimation
Various methods to estimate
1. Year 365 durations
2. Week ends 104
3. Holidays 12 1. Top-Down-analogic
method (-25% / +75%)
4. Vacations 25
2. Bottom-up method
5. Illness 5 (-5 / +10%, but much
6. Education 10 longer to do)
7. Meetings 3 3. Simulation Modelisation
8. Other ? (eg Montecarlo) method
9. Admin ? (-10 / +25 %)
10. Help other ?
11. Days worked 200 days

“It is better to be roughly right than precisely wrong.”

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John Maynard Keynes (1883-1946)
 Total Cost of Ownership (TCO)
Exemple of a Digital Solution
All direct and indirect costs for owning and using a solution.
• Costs are both for development and run (fr: exploitation)
• Hardware
• Servers, devices (terminal, workstation, laptop, tablet, mobile…)
• Maintenance & Replacement (broken, lost, stolen)
• Software
• Licence (one shot or annual fee) for platform
• Maintenance
• Support
• Training
• Human Resources
• Consultants
• Designers
• Developers
• Administrators
• Trainers
• Support
• Users 19
 Schedule Management

It is impolite to be late for some cultures

and always uncomfortable in projects

From : « mind your manners »

 Why do we schedule & plan?

1. To answer the question:

can you deliver on time or before ?
2. To assign tasks to practitioners
3. To do project tracking
4. To communicate the team
5. To see the impact of changes

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Standard for task representation
(CPM = Critical Path Method)

Early Start Early Finish

Task
Duration

Late Start Late Finish

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 CPM : Example
All precedences are “FS” (Finish to Start) by default

6 9

2 2 5 3

12
Questions are :
what is the project duration ?
What is the critical path ? 23
 First step : forward pass
(calculating from left to right)
3 9 9 18
6 9

1 3 9 11
11 16 18 21
2 2 5 3

3 15
12

Can start at day 0 or day 1 – your choice

Forward pass gives the project duration : 20 days 24
 Second step : backward pass
(calculating from right to left)
3 9 9 18
6 9
3 9 9 18

1 3 9 11 11 16 18 21
2 11
2 5 18 18
3
1 3 13 13 21

3 15
12
6 18

Backward pass gives the critical path 25

 Critical Path
3 9 9 18
6 9
3 9 9 18

9 11 11 16
1 3 18 21
2 2 5 3
1 11 13 18 21
3 13 18

3 15
12
6 18
- Can start at day 0 or day 1 – your choice
- Forward pass gives the project duration : 20 days
- Backward pass gives the critical path
- Critical path is where Early Finish = Late Finish (or ES=LS)
- The critical tasks (thick border) are the tasks to concentrate on
- Other tasks (non thick border) are not critical 26
 About...relations between tasks
& task constraints

Tasks Relations Tasks constraints

FS / SS / FF ALAP, ASAP, FNET, FNLT,
MFO, MSO, SNET, SNLT.

Finish-Start
Start-Start
Finish-Finish

3 3

As Late As Possible – As Soon As Possible Finish No Earlier Than27

– Finish No Later Than - Must Finish On – Start No Earlier Than
 Other Methods

1. PERT
1. Program Evaluation Review Technique
2. An enhancement to the CPM method
3. Task effort estimates in CPM are point estimates,
while they are computed by weighting the
Optimistic, Most Likely, and Pessimistic estimates
as (O + 4xM + P) / 6
2. GERT and CDM (Conditional Diagramming Method)
allow loops and dependancies

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 Scope Management
WBS / OBS

WBS = Work Breakdown Structure

Lists the tasks or activities that make the scope of the project.
They are presented as a hierarchical tree.

OBS = Organisational Breakdown Structure

Describes the teams organisation in the project
(who does what?)

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 WBS
(Work Breakdown Structure)

1. A representation of everything that is necessary

to produce the deliverables.
=> The WBS entirely defines the project.
What is not in the WBS is outside the project !
2. The lowest level corresponds to tasks
(with duration in proportion of project duration)
3. The tasks are associated with productions that
can be planned, controllable, accountable.
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 WBS
• Starts by an Action Verb (eg “build the wall”). No dates.
• Objective-oriented. Pragmatic deliverables.
• Lists all needed activities for planning, estimates,
budget, measurement of performance, tests, changes...
• Builds the project. A reference for the stakeholders,
independently of organization, financing, accounting…
• Clarifies the responsibilities.

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 WBS Example
based on 7 phases

Action verbs

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1. Widget Management System
1.1 Initiation
1.1.1 Evaluation & Recommendations
1.1.2 Develop Project Charter WBS Example:
1.1.3 Deliverable: Submit Project Charter
1.1.4 Project Sponsor Reviews Project Charter
Widget project
1.1.5 Project Charter Signed/Approved
1.2 Planning
1.2.1 Create Preliminary Scope Statement
1.2.2 Determine Project Team
1.2.3 Project Team Kickoff Meeting
1.2.4 Develop Project Plan
1.2.5 Submit Project Plan
1.2.6 Milestone: Project Plan Approval
1.3 Execution
1.3.1 Project Kickoff Meeting 1.4 Control
1.3.2 Verify & Validate User Requirements 1.4.1 Project Management
1.3.3 Design System 1.4.2 Project Status Meetings
1.3.4 Procure Hardware/Software 1.4.3 Risk Management
1.3.5 Install Development System 1.4.4 Update Project Mgt Plan
1.3.6 Testing Phase
1.3.7 Install Live System
1.3.8 User Training
1.3.9 Go Live
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34
 Milestones and Deliverables
● Each milestone corresponds to a deliverable
• Milestones are used to provide high-level view of the plan
• Deliverables are visible on the contract
• A milestone is a zero-duration, zero-cost task
• Project can be presented with a high-level milestone plan

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 Dependencies
• Tasks or events or activities that come from the outside of
the project scope.
• Should be listed as a separate summary task
(without any resource associated to it)
• Should be linked to a task.

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 PM Softwares vs.
Project Size & Complexity
# WBS lines

10000 Create subprojects

Corporate tools
RPM, ESE, PMPHQ, PMO,...
1000
Microsoft Project (*)
100
Use Communication tools
spreadsheets Web site, Notes, etc.
10
1 10 100 1000
# stakeholders
(*) Other products : ProjectLibre, Primavera, PSN, Open plan, Augeo, Superproject,
Gantt project… In the Apple world : Planning PRO, Gantt Lite / Pro 37
 Project Tooling comments
1. Number of stakeholders is a key factor for complexity
2. Having +10 persons using a same MS Project requires
to run a specific project (education, refresh, etc)
3. MS Project is a good vehicle for communication

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 International Enterprise
Project Management

Tooling

example of ProjectLibre

Download from
https://sourceforge.net/projects/projectlibre/
 About ProjectLibre

I. A replacement of OpenProject
II. Free (MS Project Pro list price is around 140 €)
III. Simple to install and use
IV. Very comprehensive.
V. Can save XML files compatible with other tools

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Methodology for creating a new project

I. Enter the Work Breakdown Structure (use verbs)

II. Enter the tasks durations & dates
III. Enter resources (table)
IV. Assign resources
V. Enter constraints & dependencies (FS, SS, etc)
VI. Optimise the schedule & resources

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 Notes on the methodology
1. Allows to focus on project triangle (« scope »)
and to not forget any task (« cost » approach)
2. Sometimes is it more intuitive to do at the same time
WBS + date/duration + constraints/dependencies
3. Do not use too many tasks dependencies.
It will become unmanageable

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 Resources
• Resources are shared entities.
• All the people and materials are shared by all projects
supported by the organization.
• People resources have the type « Work » (in hours or days)
• Materials resources have the type « Material »
• Material resources by quantity
– In “resource sheet”, add one “material resource”
with a cost per unit (eg one bottle, 1 Euro)
– In “Gantt chart”, assign 30 bottles → 30 Euros.
• Material resources at cost
– In “resource sheet”, add one “cost resource”
with a fixed cost (eg one fridge, 150 Euros)
– In “Gantt Chart”, assign one fridge → 150 Euros.
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 ProjectLibre Education
Main Views
1. « Gantt »
2. « Network »
3. « Resources »

44
 I. Enter WBS
Open “ProjectLibre » Double click on icon

Enter a project name ’File-save as ’

Enter project start date ’Project - Information’
Select Gantt view ‘view - Gantt’

Enter first task ‘task name ’ field

Enter second task Use ‘enter’ key

Create subtasks Use ‘indent’ arrows

File ‘file’

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 II. Enter Task Durations & dates
Select Gantt view ‘view - Gantt’

Enter task 1 start & Click in columns ‘start’

end dates and ‘finish’
Enter task 2 start + Click in columns ‘start’
duration
Enter next tasks Copy/Paste
durations & dates Or- drag/drop

File ‘file’

• Task: a unit of work (resources are usually allocated at task level).

• Summary Task: has subordinate tasks (sub tasks) and rolls up
information based on these sub tasks. 46
 III. Enter Resources
Select Resource view view - Resources’

Enter Resource 1 name Click in second column, type

name
Select resource type “work” Use drop-down list in column 4

Enter standard rate Type in column 10 (40€ per hour)

File File’

• Resource Team: a number of resources working together for a common purpose.

• Resource Group: a number of similar resources (e.g. painters).
• Resource Breakdown Structure (RBS): organizes resources into resource groups
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 IV. Assign Resources

Select Gantt view ‘view Gantt’

View ‘resource name’ Draw curtain to the right

Enter name 1 Drop-down list

Enter all names Copy/paste

File ‘file’

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 V. Enter Constraints &
Dependencies

Select Gantt view ‘view-T.Gantt’

Link tasks 1 & 2 Select tasks 1&2 and click

on ‘link tasks’ icon
Link tasks 1 & 3 Double-click task 3
Select ‘predecessor’
Enter ‘Task 1’
Create all major links Check durations / dates

File ‘file’
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 VI. Optimize cost & schedule

Select Gantt view ‘view-Gantt’

View critical path Appears in red

Try to parallel tasks

Try to assign more
resources
File ‘file’

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 Assignment 3 (2-3 hours)
Open ProjectLibre
1.Enter 30-50-lines WBS (based on Milestones)
2.Enter tasks duration
3.Enter constraints and dependencies, links between tasks
4.Enter and assign resources
5.Look at resource usage and optimize planning
6.Simulate Development (doing) phase and do tracking
7.Produce reports and check:
1.Initial budget is in line with WBS result
2.Resources are well used (no overrun)

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 Step 1 - Build the initial schedule

1. Input project plan

2. Verify defaults
3. Establish calendars
4. Enter tasks
5. Assign resources
6. Examine task dependencies

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 Step 2 - Optimise the Schedule
1. Objective :
– Shorten time
– Reduce costs
– Improve resource
2. Two main methods :
– Crashing (re-schedule)
– Fast tracking (try to run tasks in parallel)
3. More tips:
1. Try FF instead of SF
2. Add people, use partial time
3. Put more productive people
4. Implement new productivity tools to decrease
durations 53
 Step 3 – Do tracking

1. Save your baseline

2. Consider Done vs. Planned
3. Check people availability
4. Balance resources
5. Reschedule

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 Step 4 - Handle changes
A new set of approved requirements comes up
(new functions, new people, new constraints, new
budget, new timeframe…)
1. Assess impact & induced risks (teamwork)
2. Propose plan of actions
3. Get written agreement
4. Store actions and decisions in the PCB
(Project Control Book)
5. Communicate

Nota 1 : the change management procedure must have been defined

upfront (at concept phase) and should be followed. 55
Nota 2 : improper change management is a major driver for project failure