Project

Planning and
Management
.

Project Scope
Once the project is selected, its scope must be defined as it sets the
stage for developing the project plan, project scope (Scope refers to a
project’s boundaries, it determines what work will be completed during the
project lifecycle).

 Project scope – the work that needs to be accomplished to deliver a

product, a service or result with the specified features and
functions.
 Product scope – the features and functions that characterize a
product, service or result.
Project scope is contained in a Project Initiation Document (PID) or Project Charter.
Note: The project management methodology that your organization uses may also
determine whether you should use a Project Charter or a Project Initiation Document
 Why use project planning tools
 To identify the full scope of the project
 Establish achievable objectives for the project, quantified in terms of
activity time, cost and resources.
 Reduce project risk and uncertainty, by identifying the critical
activities.
 Provide the basis for a quantified cost benefit analysis
 Provide a communication tool to disseminate scope information and
issue instructions to the project participants.
 Monitor and track the work done.
 Evaluate progress by comparing planned with actual
 Forecast progress trends and apply corrective action to keep the
project on course.
 Identify areas of responsibility per work package or activity.
 Project scheduling tools
 Work Breakdown Structure (WBS)
 Precedence table
 Network diagram
 Bar Chart
 Gantt Chart
 Resource planning & levelling
 Project Evaluation & Review Technique (PERT)
 Responsibility matrix
 Resource matrix
WBS
Its like a family tree or a jigsaw puzzle with every piece put in its right place
and with no piece missing that could spoil the total picture.
• A hierarchical reflection of all the work in the project in terms of
deliverables
• It is dividing the project into specific measurable
activities/tasks/milestones, grouping similar activities logically to form work
packages e.g painting a room
 Benefits of WBS
 Nailing down of work that has to be achieved.
 Sequencing of activities to be done on a project.
 Helps in assigning dependence of activities
 Informs the stakeholder of the project scope
 Cost planning
 Allocation of time and resources (physical & human, raw
materials)
 Risk management
 Easy monitoring of work progress
 Provides clarity of the project objectives
 Ensures accountability – tasks are assigned to officers
 It provides a framework/structure of the project.
 Example of a WBS for painting a room..
• Project started and Material
Project started 0 days preparation completed are
1. Prepare materials 5 days project milestones defining a
 Buy paint 2 day specific status which should
 Buy a ladder 1 day have been reached within the
 Buy brushes/rollers 1 day scope of the project, typically
 Buy wallpaper remover 1 day indicating that some work or
Material preparation completed 0 days phase has been started or
2. Prepare room 7 days completed
 Remove old wall paper 1 day • Numbered list are referred to as
 Remove detachable decors 1 day work packages (the main
 Cover floor with old newspapers 1 day objective) and is normally done
 Cover electrical switches 1 day during the project scope
 Cover furniture 1 day development
 Scrap the wall 2 days • The bulleted list are referred as
3. Paint the room 3 days activities or tasks - activities are
4. Clean up the room 4 days explanation of what you have to
 Dispose or store left over paint 1 day do to finish Work package.
 Clean paint brushes & rollers 1 day Activities are created in Time
 Dispose old newspapers 1 day Management in PMBOK
 Remove cover 1 day
Group work….number 2
Using the RACI project on the record system
you designed, expand by showing the
milestones, activities, work packages, duration
of each activity and indicate the
dependencies.
Examples of planning tools diagrams
Network Diagram – Arrow Diagramming
Method (ADM)
Activity on Arrow
ADM
 Precedence table

Activity Duration Preceding Activity

A 5 -
B 2 A
C 18 B
D 10 -
E 15 D
F 5 E,C
 Simple Gantt chart in excel
A Gantt chart is a type of bar chart, devised by Henry Gantt in the 1910s, that
illustrates a project schedule.
 PERT
Project Evaluation & Review Technique

 With PERT, activity durations are deemed uncertain

 Example: an activity ‘X’ will need

 Using CPA: 13 days
 Using PERT: 10 to 25 days
Task duration = “10 to 25 days”
How do you use this information?

As it is, it is ambiguous (here’s why):

The most likely duration may be (10+25)/2 = 17.5
days
Or it could be anything < 17.5 days, eg. 13 days
Or it could be anything > 17.5 days, eg. 21 days

How would you know? – You don’t!

 You must assume a ‘distribution’ over [10; 25]
For various reasons + experience, one usually assumes
a beta distribution:
Beta - continuous probability distributions
 The beta distribution assumed in PERT

The beta distr. can be simplified into a 3-point distribution:

An optimistic estimate = 10 days
A pessimistic estimate = 25 days
A ‘most likely’ estimate = 13 days
 Leads and lags time in activity scheduling
Leads
o A lead is the amount of time a successor activity can be
advanced with respect to a predecessor activity.
o Lead time refers that the successor activity depending on the
previous activity will start before the previous activity finished.
Lags
o A lag is the amount of time a successor activity will be delayed
with respect to a predecessor activity
o Lag time refers to the time that will pass before the successor
activity starts.
Durations and Dependencies
In a project, the durations are estimated as follows:
o Technical design of module A: 10 days
o Technical design of module B: 5 days
o Development of module A: 15 days
o Development of module B: 20 days
The dependencies are:
The technical designs of module A and B, respectively, must be
completed before the respective module can be developed,
the technical design of module B makes reference to that of
module A, thus, the module A design needs to be 50% completed
before the module B design can be started, and
the development of module A depends on module B, which needs
to be 25% completed before the team can start the development
of module A.
Finish-to-Start Sequence
Due to these interdependencies, a project manager could
assume that there is an inherent finish-to-start relationship
among these activities. If it were a sequence based on finish-to-
start relationships, it would look as follows:
o Design module A
o Design module B
o Develop module B
o Develop module A

What is the combined duration of this project?

Finish to Start relationship

Schedule of the project based on finish-to-start relationships.

Leads and Lags
 Task Dependencies in Projects
o Dependencies are the relationships of the preceding tasks to the succeeding
tasks. Tasks may have multiple preceding tasks and multiple succeeding tasks.
The most common dependency relationship is a finish-to-start relationship.
Predecessor (P) must be finished before task Successor (S) can start.
o Dependencies are the relationships among tasks which determine the order in
which activities need to be performed.

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Task Dependencies in Projects- they are of four (4) types
P Predecessor must finish before Successor can start. [Land
must be purchased before building a record centre] –
S Finish to Start

P Predecessor must start before Successor can start.

[Hardware configuration must start before installation of
the record management software] – Start to Start
S

P Predecessor must finish before Successor can finish.

[Software installation must be complete before testing]
Finish to Finish
S
Predecessor must start before Successor can finish.
P [Hardware acquisition must start before software
installation must be completed] – Start to Finish
S
Apply the above task dependencies on a record management project of choice

22
 Dependency determination integration Attributes

o Mandatory dependencies
o Discretionary dependencies
o External dependencies
o Internal dependencies

4/4/2022 23
o Mandatory dependencies– impossible to reverse sequence
due to the nature of the project work. A must do sequence.
o Discretionary dependencies – can delete dependency of the
project based on experience and the decisions are usually based
upon best practices, business knowledge on projects of similar
nature.
o External dependencies – dependent on some event external to
the project which the project team does not have control over
it..e.g suppliers
o Internal dependencies - relationship between two tasks or
activities within the project and are generally within the project
team.

4/4/2022 24
 Brief description of the tools for estimating resources
1. Expert judgment means bringing in experts who have done this sort of work
before and getting their opinions on what resources are needed.
2. Alternative analysis means considering several different options for how you
assign resources. This includes varying the number of resources as well as the
kind of resources you use. Many times, there’s more than one way to accomplish
an activity and alternative analysis helps decide among the possibilities.
3. Published estimating data is something that project managers in a lot of
industries use to help them figure out how many resources they need. They rely
on articles, books, journals, and periodicals that collect, analyse, and publish data
from other people’s projects.
4. Project management software such as Microsoft Project will often have features
designed to help project managers estimate resource needs and constraints and
find the best combination of assignments for the project.
5. Bottom-up estimating means breaking down complex activities into pieces and
working out the resource assignments for each piece. It is a process of estimating
individual activity resource need or cost and then adding these up together to
come up with a total estimate
 Estimating Activity Durations
Once you’re done with activity resource estimating, you’ve got everything you need to
figure out how long each activity will take.
1. Expert judgment will come from your project team members who are familiar
with the work that has to be done. If you don’t get their opinion, there’s a huge
risk that your estimates will be wrong.
2. Analogous estimating is when you look at similar activities from previous
projects and how long they took. This only works if the activities and resources
are similar.
3. Parametric estimating means plugging data about your project into a formula,
spreadsheet, database, or computer program that comes up with an estimate.
The software or formula that you use for parametric estimating is based on a
database of actual durations from past projects.
4. Three-point estimating is when you come up with three numbers: a realistic
estimate that’s most likely to occur, an optimistic one that represents the best-
case scenario, and a pessimistic one that represents the worst-case scenario.
The final estimate is the weighted average of the three.
5. Reserve analysis means adding extra time to the schedule (called a contingency
reserve or a buffer) to account for extra risk.
 Activity Durations
 The activity duration estimates are an estimate of how long each
activity in the activity list will take.
 This is a quantitative measure usually expressed in hours, weeks,
days, or months.
 Another thing to keep in mind when estimating the duration of
activities is determining the effort involved. Duration is the
amount of the time that an activity takes, while effort is the total
number of person-hours that are expended. If it takes two people
six hours to carve the ice sculpture for the centrepiece of a
wedding, the duration is six hours. But if two people worked on it
for the whole time, it took 12 person-hours of effort to create.
Resource Levelling
 Resource levelling is used to examine unbalanced use of resources (usually
people or equipment) over time and for resolving over-allocations or
conflicts.
 When performing project planning activities, the manager will attempt to
schedule certain tasks simultaneously. When more resources such as
machines or people are needed than are available, or perhaps a specific
person is needed in both tasks, the tasks will have to be rescheduled
sequentially to manage the constraint.
 Resource levelling during project planning is the process of resolving these
conflicts.
 It can also be used to balance the workload of primary resources over the
course of the project, usually at the expense of one of the traditional triple
constraints (time, cost, scope).
On resource levelling consider project slack time and critical path
Slack/float time can be defined as the amount of time any task can be delayed without
causing another task to be delayed or impacting the completion date of your project.
Critical path: Longest sequence of activities in a project plan which must be completed
on time for the project to complete on due date
 Project budgeting
Reliable cost estimates are necessary for all projects. Without a cost estimate it
would be impossible to prepare a budget plan for the entire project.

Managing to a budget begins with planning a solid budget

 Characteristics of a project budget
 A budget is a plan for allocating financial resources
 The art is in funding each planned activity to the right level.
 Budgets are tied to activity achievement and time
 Data about the relationship between budgeted
amount/activity achievement/time spent must always be up
to date.
 Costing of each activity on the WBS result on the overall
project budget.
 In a nutshell a budget is a project plan in financial terms.
 Project budget development
 Costs are not budgets unless they are time phased, so budgeting is
relating estimated costs to estimated time.
 Two types of budget are prepared for the project
1. For a project starting and finishing early as planned
2. Late possible completion of the project
In developing a budget the following needs to be identified per
activity
 Type of labour costs to be incurred
 Cost of equipment needed
 Unit cost for labour, equipment and materials
 Administration costs
 Amount of contingency needed
 Reserve management
What is a Reserve Management ?
The management reserve is the amount of the project budget
reserved for unforeseen work that is within the scope of the project.
o Contingency Reserves are for identified risks.
o Management Reserves are for unidentified risks
The project manager adds the management reserve, contigrency to
the cost baseline resulting in the total project budget.
Project Budget = Cost Baseline + Management Reserve +
Contingency.
Who Controls the Management Reserve?
The project manager does not have control of the management
reserve. That’s why it’s called the “management” reserve. It’s
controlled by management, most typically the project sponsor or
senior management. The project manager cannot access or adjust the
management reserve without approval from the sponsor. A common
method for deriving the management reserve is to add 5-10% of the
cost baseline.
 Project summary budget
Activities
Rolled up into
Work Packages
Cost Baseline
Rolled up into

Cost Budget
Control Account
Rolled up into
Project
ADD

Contingency Reserve
ADD

Management Reserve
33
 Terms commonly used on project costing
1. Absorption costing - means that all of the manufacturing
costs are absorbed by the units produced.
2. Direct costs – costs that can be directly attributed to the project work.
3. Cost of sales - the cost of purchasing raw materials and manufacturing
finished products.
4. General and administration costs - The fixed cost incurred in the
operation of a business e.g office space rental, plant and equipment,
staffing, and expenses
5. Indirect costs – cost that must be incurred to operate the business as a
whole, so they cannot be attributed to a single product.
6. Labour burden – a percentage of wages paid to employees on non
working days (overtime)
7. Variance – the difference between actual cost and budgeted cost
8. Overhead costs - costs required to run a business, but which cannot be
directly attributed to any specific business activity (“What must I pay for
each month in order to keep my business open?“)
 Project budgeting
Determine the physical resources Estimate the financial resources

 Personnel  Salaries and fringe

 Facilities – office space benefits
 Equipment  Rent
 Supplies  Transportation
 Working telephone line  Utilities
 Information systems
(hardware and software)
 Techniques for budget estimation

 Parametric estimating
 Analogous estimating (top down estimating – not very
accurate – costing of the whole unit based on previous
data e.g cost of constructing a bridge, is normally used
on construction projects where cost are usually known)
 Three-point estimating
 Expert judgment
 Reserve analysis (contingency)
 Bottom-up cost estimating - Bottom up estimating is a
thorough estimation of the project by estimating each and every
work package in the WBS (for projects that have no published data
which the project team can rely on – innovation projects
 Budget variance analysis
Item Planned Actual Variance Comment Flexed budget
budget budget

Personnel 12000 9000 3000

Plant 60000 8500 -2500 Unfavourable

Suppliers 10000 15000 -5000 Unfavourable

Facilities 6500 5000 1500

Contracts 15000 8900 6100
Travel 5000 6700 -1700 Unfavourable

Contingency 10000 13500 -3500 unfavourable

Total
 Sample Budget estimation for a project

Initiation phase Who? Hours Fee Total

Research draft Project Leader 20 75 1500

Consultation
Project Leader 10 75 750
with partners

Preparation of
Department
project 40 80 3200
Head
proposal

Proposal design Graphic Design 10 50 500

Contract
1000 1000
expertise

Total : 6950
Definition phase
Who Hours Fees Total
Consultation with
Project Leader 10 75 750
end users
Functional
10 65 650
Designer
Consultation with
Project Leader 20 75 1500
experts
Functional
30 65 1950
Designer
Internal Experts 30 100 3000
Contract
2500
expertise
Catering for
250
meetings
Project
25 75 250
management

Subtotal definition phase: 10850

Design phase
Who hours Fee Total
Travel costs Team Members 1000
Design sketch Designer 60 60 3600
Design
Designer 20 60 1200
presentation
Materials 2000
Web presentation
Content Content 20 60 1200
HTML Programmer 20 65 1300
Design Designer 30 60 1800
Project
15 75 1125
management

Subtotal design phase: 13225

Preparation phase
Who hours Fee Total
Travel costs 2000
Material costs 15000
Elaboration of
Project Leader 40 75 3000
schedules
Project
15 75 1125
management

subtotal preparation phase: 22125

Implementation phase
Who Hours Fee Total
Travel costs
2000
(personnel)
Material transport
3000
costs
Operations
Carpenters 160 45 7200
(internal personnel)
Plumbers 160 50 8000
Designers 80 65 5200
Temporary workers 25000
Gas, water,
3000
electricity
Project
80 75 6000
management

Subtotal implementation phase: 59400

Follow-up phase
Who hours Fee Total
Travel costs
2000
(personnel)
Material
3000
disposal
Material
project team 40 60 2400
clean-up
Project
Final report 40 75 3000
Leader
Accountant
1000
statement
Project
40 75 3000
management

Subtotal follow-up: 15900

Summary

Subtotal initiation phase: 6950

Subtotal definition phase: 10850
Subtotal design phase: 13225
Subtotal preparation phase: 22125
Subtotal implementation phase: 59400
Subtotal follow-up: 15900

Subtotal: 128450
Unexpected costs 10% 13495

Total: 141945