Introduction to Project Management

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1 L E S S O N 1 Introduction to Project Management Suggested lesson time minutes Lesson objectives To be able to identify the steps involved in project planning, you will: a b c Plan a project. You will learn the difference between a project and a program, the constraints common to all projects, the stages of a project life cycle, why a majority of projects fail to meet their objectives, and how project management techniques help overcome these obstacles. Define the scope of the project. Before a project can be started, you should ascertain whether or not your organization's process is capable of delivery. You will become familiar with the importance of defining customer requirements, Scope documents, and Work Breakdown Structures [WBS]. Develop a schedule for the project. Once all the required work in a project has been defined, a schedule is developed. You will examine aspects of time management, work effort estimates, calendar selection, network diagrams, task dependency, relationships, and critical path(s). 1-1

2 Microsoft Project 2000: Level 1 Ashbury Training d e f Assign project resources and costs for budget development. Before a schedule or budget can be finalized, resources such as labor, material, and equipment must be identified and assigned. You will learn about resource loading, resource pools, over allocation, individual calendars, cost types and cost loading. Save a baseline for the project. Now that planning for the project is complete, you will use the project baseline to gain formal approval to move the project into the execution phase. Control the execution of a project. You will learn about gathering information and communicating that information to the stakeholders using tools in Microsoft Project. 1-2

3 Ashbury Training Lesson 1: Introduction to Project Management a Concepts > Fundamentals of Project Management A project is a series of tasks that has a definite start and finish time. It has well defined outcomes or performance goals and consumes scarce resources such as money, personnel, material, and equipment. The Constraints of a Project A project is considered constrained by three functions: 1. Delivery The time schedule for the project. 2. Cost The money, budget, and resources for a project. 3. Quality The customer requirements for the project. These three constraints are closely related in that typically one cannot be changed without impacting at least one of the others. For example, if you want to shorten a schedule, you can hire more resources (which would increase cost), or reduce customer requirements (which would affect quality). Project Life Cycles A typical project goes through the following stages: Initiation The problem or project definition. Definition The project plan development and approval. Execution The work that is accomplished. Control The work is measured and status reported. Closure The final stage where outcomes are reviewed, financial obligations, and contracts settled, resources freed up or released. What is Project Management? Project Management is the planning, organizing, scheduling, leading and controlling of a work activity to reach an objective on time and within budget. Typical Project Problems During the life of a project, you may encounter problems. The problems you may run into are: Dissatisfied customers. Deliverables not understood by project team or customer. Budgets and schedules over or under estimated. Over taxed resources. 1-3

4 Microsoft Project 2000: Level 1 Ashbury Training What Does Project Management Facilitate? Project management facilitates the application of knowledge, tools, techniques, and skills to improve a project's planning, performance measurement, accountability assignment, and risk assessment. All of these tools lead to the meeting of stakeholders' needs and expectations. Stakeholders are individuals or groups that have an interest in the outcome of a project. They can be classified into four categories: 1. Client or customer. 2. Project sponsor or parent organization. 3. Project team. 4. Public government or regulatory agencies. 1-4

5 Ashbury Training Lesson 1: Introduction to Project Management b Concepts > Defining the Scope of the Project Before you can start working on a project, one must be identified. Each organization has its own methodology for the selection process, (i.e.; financial models, benefits measurement, market studies), but the following criteria should be common to all selection processes: Project alignment with organizations goals. Organization must be process capable of successfully completing the project. The first phase in the project life cycle is Initiation. In most organizations, this is accomplished by management. However, the outcomes are crucial to the successful completion of the project. Outcomes of Initiation Phase The following are expected outcomes of the Initiation phase: The Project Character is created. The Project Character is an official internal document which identifies the business need and provides a general project description, cost estimates, time estimates, any known risk assumptions, and the Project Manager's authority and responsibilities. The project manager and key project team members are assigned. Authorization to begin the Planning Phase of the project is received. A Scope Document is created. The Scope Document forms a formal understanding of project deliverables for all stakeholders. It becomes the basis for any future project decisions and planning. It contains all project deliverables and project objectives which are used to measure criteria for project success. Task B-1: Defining customer/client requirements q Objective: To ensure that all customer requirements are collected and understood by the stakeholders. 1. Identify your customers. The primary customer is not always the end user. You may meet the primary customer's requirements, but fail to meet end-user requirements. 2. Define the requirements as set forth by your customers. During this process, don't be afraid to ask Why? Determine the importance of usability, flexibility, serviceability, cost, etc. for the customer. 3. Create a Scope document. The Scope Document forms a formal understanding of project deliverables for all stakeholders. 1-5

6 Microsoft Project 2000: Level 1 Ashbury Training Concepts > Creating a Work Breakdown Structure The Work Breakdown Structure (WBS) is a family tree that represents all project work. Beginning with the project goal or objective, the project's work is progressively broken down until it reaches a level where you can estimate the duration of the lowest level subtasks. The WBS can be drawn as a graphic that is displayed much like an organization chart with finite components, or it can be drawn as a simple outline. Microsoft Project uses the outline method to represent the Work Break Structure. Steps to Building a Work Breakdown Structure Follow the steps below to build a WBS: 1. The entire project team should participate in the development of a WBS. This will instill a sense of ownership in the project. 2. The entire project team should brainstorm to identify major work groups or elements. 3. Break down work into smaller deliverable units commonly called work packages. 4. Assure work package deliverables are measurable. 5. Identify task owners. 6. Identify needed resources. 7. Review WBS to insure that no work has been omitted. 8. Document all data using a task worksheet as displayed in Figure 1-1. You can also use the task note function in MS Project Figure 1-1: The Task Worksheet. 1-6

7 Ashbury Training Lesson 1: Introduction to Project Management Work Breakdown Structure Levels The WBS goal is to break larger tasks into smaller more manageable components. Not all projects are the same; therefore, they don't require the same number of levels. The levels/steps used in breaking down any project are: 1. Level 1: the project name. 2. Level 2: the project milestones or major work groups 3. Level 3: the tasks. 4. Level 4 n : subtasks or work packages. The Types of Work Breakdown Structures There are three types of Work Breakdown Structures that you can use. The first is a tree diagram as shown in Figure 1-2. Figure 1-2: A tree diagram. 1-7

8 Microsoft Project 2000: Level 1 Ashbury Training The second type of structure you can use is the linear chart. It lists the steps (tasks) of the project and who is assigned to the task. Figure 1-3 contains a sample linear chart. Figure 1-3: A linear chart. The third type of structure you can use the Gantt Chart. The Gantt Chart is available in Microsoft Project Figure 1-4 contains a sample Gantt Chart. Figure 1-4: A sample Gantt chart. Task B-2: Developing a Work Breakdown Structure q Objective: To create a structured listing of all activities, tasks, and work required to successfully complete project deliverables. 1. Choose from one of the following projects and create a simple WBS: cleaning your garage, washing your car, or mowing your lawn. 1-8

9 Ashbury Training Lesson 1: Introduction to Project Management c Concepts > Developing the Project Schedule The next step in the Planning phase of the Project Life Cycle is the development of the project schedule. This phase encompasses three major activities: 1. Establish the project calendar. 2. Decide how much work needs to be accomplished. This is called effort estimating. 3. Set up task relationships and dependencies. You will decide what tasks need to be accomplished first. Establishing the Project Calendar The calendar represents the general working times of the project. It establishes the number of work hours each day and the number of work days per week. Microsoft Project 2000 offers multiple calendars: Standard calendar working times are Monday through Friday, 8:00 AM to 5:00 PM with 1 hour for lunch. 24 Hours calendar represents working 24 hours per day, 7 days per week. No non-working time is specified. Night Shift calendar represents a grave yard shift of Monday night through Saturday morning, 11:00 P.M. to 8:00 A.M., with 1 hour for lunch. Estimating Work Effort All activities require the usage of time to complete a task or activity. This is referred to as activity duration. Microsoft Project 2000 provides for the following duration values: Duration m h d w mon e Represents minutes hours days weeks month elapsed duration There are three types of estimates: Effort Estimates refer to the amount of work, personnel, or equipment required to complete an activity. It's commonly referred to as "billable time." Effort estimates are used for budget development. Duration Estimates refer to the amount of time, calendar or clock, needed to complete an activity. It's a function of the amount of work to be accomplished and the number of resources available to perform the work. Duration estimates are used for schedule development. Elapsed Duration Estimates refer to a continuous activity. For example, a life test which must be run 24 hours per day for 20 continuous days. 1-9

10 Microsoft Project 2000: Level 1 Ashbury Training For example, an activity is estimated to require 30 days of work (effort). If there's only one person available to work on the task full time, the duration of that task is 30 days. If there are two people available to work on the task full time, the duration will be 15 days; three people, 10 days. Determining Activity Sequencing To develop a realistic and achievable schedule, you must determine the relationships and dependencies of the activities to each other. There are four types of relationships: Relationship Finish-to-Start Finish-to-Finish Start-to-Start Start-to-Finish Description The preceding activity must finish before the successor activity can start. The preceding activity must finish before the successor activity can finish. The preceding activity must start before the successor activity can start. The preceding activity must start before the successor activity can finish. The proper selection of task dependencies enable Microsoft Project 2000 to incorporate flexibility in your project schedule. The next step in developing a project schedule is to construct a network diagram. Network diagrams are made up of both tasks and events (the start or finish of activities). They provide a picture of the total project which can be used by the project manager to obtain the following information: The project finish date. Impact of schedule slippage. Activity interdependencies. Performance evaluation and measurement. What if analysis. There are three network diagramming techniques. The Arrow Diagramming Method (ADM) uses arrows to represent activities and they connect to nodes, which represent events. The arrows also show dependencies. Figure 1-5 displays an ADM diagram. Figure 1-5: The Arrow Diagramming Method. 1-10

11 Ashbury Training Lesson 1: Introduction to Project Management The Precedence Diagramming Method (PDM) uses nodes to represent activities and the connecting arrows to delineate dependencies. Figure 1-6 displays a PDM diagram. Figure 1-6: The Precedence Diagramming Method. Gantt Charting is another method you can use to diagram. Gantt Charts use activity bars displayed on a horizontal timeline as displayed in Figure 1-7. It's easy to read and can be very helpful in sequencing and resource allocation. Figure 1-7: The Gantt chart bars displayed on a horizontal timeline. Task C-1: Prepare a precedence diagram 1. Using the information in the following table, construct a precedence diagram. Task A B C D E F G H Completion Predecessor none A B C B D, E D E F, G, H 1-11

12 Microsoft Project 2000: Level 1 Ashbury Training Figure 1-8: The answer for the precedence diagram. Concepts > The Critical Path The critical path is the series of tasks which represent the longest path through the network diagram. This path is considered critical because if any task end date is missed on a critical path, the project's finish date will be missed. There are two techniques used in determining the critical path(s). Forward Pass Technique - you begin with the start of a project and determine the early start [ES] and early finish [EF] dates for each activity. Using the early finish [EF] of the proceeding activity as the early start [ES] of the succeeding activity, then add the activity's duration estimate to calculate the early finish [EF] date. Figure 1-9 displays a Forward Pass Technique diagram. Figure 1-9: The Forward Pass technique diagram. To calculate the critical path: Path A[6w]+B[4w]+D[2w]+F[4w]+H[1w] = 17 Weeks Path A[6w]+C[5w]+E[2w]+G[5w]+H[1w] = 19 Weeks The critical path consists of tasks A,C,E,G,H. The project duration is 19 weeks. 1-12

13 Ashbury Training Lesson 1: Introduction to Project Management Backward Pass Technique - You begin at the finish date of the project and calculate to the left [backwards] to determine late start [LS] and late finish [LF] dates for each activity. Figure 1-10 displays a backward pass technique diagram. Figure 1-10: The Backward Pass Technique diagram. To calculate the critical path: Path A[6]+B[4]+D[2]+F[4]+H[1] = 17 weeks Path A[6]+C[5]+E[2]+G[5]+H[1] = 19 weeks The critical path consists of tasks A,C,E,G,H. The project duration is 19 weeks. 1-13

14 Microsoft Project 2000: Level 1 Ashbury Training d Concepts > Assigning Project Resources Once all work has been identified and the preliminary schedule established, all resources which will be required to execute the project, must be identified and an acquisition plan developed where required. There are various types of resources to be considered, such as people, equipment, materials, facilities, and technology or knowledge. You must also consider availability, cost, and capability for each required resource. The information required can be loaded into Microsoft Project 2000 in many ways. You can use the Resource Sheet, the Resource Form, or the Resource Information dialog box. Regardless of the way you enter the information, the same basic information is required. Field Resource name or initials Maximum # of Units Available Standard Rate Overtime Rate Cost Per Use Accrual Rate Base Calendar Definition Used to identify the resource. The total number of like units available for the project. The costs charged for regular, non-overtime work. The rate of pay for overtime work. Rate must be entered even if it's the same as the Standard Rate. If nothing is entered, Microsoft Project 2000 will calculate at $0.00 per unit of time. This represents a cost per use fee. An example is a consultants fee that is $1, per visit. Determines how costs are captured as a resource is used. Costs can be accrued at the start of a task, when the task has been completed, or as the resource is used. The calendar used for the project. Replanning a Schedule From time to time a project will not have adequate levels of resources to successfully deliver on time, within budget, or with original requirements. The project manager must then attempt to shift or add resources. Here are a few techniques used by project managers: Resource leveling an attempt to shift the use of resources to adjust the project schedule's peaks and valleys. However, this may not be possible without causing changes to the budget or project schedule. Resource allocation an attempt to use available resources to develop schedule relief. However, resources may not be technically qualified to perform more than one activity. Crashing an attempt to accelerate the project schedule by adding additional resources. However, this will increase the cost of the project. Fast Tracking an attempt to accelerate a project schedule by disregarding task dependencies and overlapping sequential tasks. This is a high risk activity. 1-14

15 Ashbury Training Lesson 1: Introduction to Project Management Microsoft Project 2000 will identify resource over-allocation and perform resource leveling upon request. Identifying Other Cost Information Labor and material costs are not the only costs associated with the life of a project. There are other types of costs associated with a project, variable or fixed. Variable costs are associated with usage and fixed costs are constants over the life of a project. Other costs include office supplies, insurance, rent, burden, utilities, and capital. These costs must be identified and can be input for each task using the Cost table in MS Project The development of a complete and accurate budget is important because it not only represents a plan for the allocation of scarce resources, but also as a control mechanism for the project. It serves as a baseline from which the variance between planned and actual costs can be measured. 1-15

16 Microsoft Project 2000: Level 1 Ashbury Training e Concepts > Saving the Project Baseline The development of a project baseline signifies that the project is ready to proceed into the Execution phase. The approval of a project baseline will provide authorization for the project to proceed. This authorization must be formalized either by a purchase order, contract, or letter of intent from the project customer. The baseline represents the customer requirements and any deviation from it should not be made lightly. A formal authorization process must be established to control any changes to the baseline. 1-16

17 Ashbury Training Lesson 1: Introduction to Project Management f Concepts > Controlling Project Execution Control in a project is the gathering of information which is used to measure, monitor, and make adjustments to project actions, as required. This information is also communicated to all project stakeholders. Microsoft Project 2000 provides seemingly endless options such as overview reports, current activities reports, cost reports, workload reports, assignment reports, and custom reports. 1-17

18 Microsoft Project 2000: Level 1 ) Wrap-up for Lesson 1 a What are the major constraints of a project? The three constrains are the project's cost, delivery, and requirements. Who are the stakeholders? Individuals or groups that have an interest in the outcome of the project. b What's a Work Breakdown Schedule? It's a listing or graphic display of all the work required to accomplish a project. c What is an effort estimate? It's the amount of work required to complete an activity. d What are three things to consider when assigning resources? The availability, cost, and capability of the resource. e When would you save a project baseline? The project baseline is saved before you enter the execution phase. f What's the best method for controlling a project? Keeping everyone involved with the project up to date on the progress via reports. 1-18

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