QUIZ #1 Preparation Materials
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1 1 This collection of questions has two purposes in this study preparation document: 1. Give you questions to think more about the theory and concepts for Quiz #1. 2. To give you an idea of the kinds of questions that can appear on the quiz. If you study this document and review the definitions in the lecture notes after class for 2-4 hours, then you should be feeling rather confident about the first quiz. Quiz #1 Topics Strategy and projects WBS and Cost Accounts STUDY GUIDE for Quiz #1 Strategy and Projects Review notes on purpose of projects. o There are many questions over the definitions that you will need to know very well. Review methods for prioritizing projects in a company. o Be sure that you know the differences among the various methods, i.e., how is financial different from categorizing. o How are financial and categorizing different from priority matrix. Study the details of each definition and concept. For example, categories do not use financial break-even analysis. WBS-OBS and cost account questions Understand cost accounts. Keep in mind the intersection, tasks in a cost account, sub-deliverables, roll-up values, organizational resources from specialty departments, etc. The real point is not to quote 7 different definitions, but explain how these multiple perspectives are interrelated to explain work, budgets, and contribute to the eventual finished project. o Who, what and why o Intersection idea and CA being collection of work packages. Understand the difference between a WBS and an OBS. To show this difference, you should be able to convert from one perspective to the other, i.e., OBS to WBS or WBS to OBS. You should be able to identify cost accounts in the WBS or OBS tables. o They are very different in their structure and perspective. o They contain exactly the same data. Be able to convert from WBS to OBS or the other way around. Know what a work package is all about. (see above on ( Understand Cost Accounts ) Know the difference between the purpose of the WBS and OBS (individually and integrated) and the purpose of a project network. Understand rollup and how to calculate.
2 Practice Quiz #1-1 2 (Answers follow after the sample practice quiz. But, try the quiz first) 1. What amount would you submit as a project bid to win a contract? a. Task time-phased budget. b. Project rollup c. Earned value 2. True False Sub-deliverables clarify the work that employees will be doing in a project. 3. True False A cost account clarifies who will be doing the work for a sub-deliverable. 4. Which of the following is true about the concept of a cost account? a. It is the sum of all the work package costs to produce a single sub-deliverable. b. It is the cost of the work by a single department to produce a single subdeliverable. These questions refer to the Integrated WBS-OBS diagram on the next page 5. Explain all the cost accounts for the production unit. This will be an abbreviated answer, as by now, you are getting the idea of the cost account. 6. Which organizational units are responsible for producing the circuit board? 7. How much should Design budget for its Hard Drive sub deliverables in the PC prototype? 8. Be able to calculate a rollup cost for various parts of this integrated WBS/OBS diagram, such as sub-deliverable 1.1 or hard drive (on the test only the work package and cost account values will be given to you). Example: What is the rollup cost for the Hard Drive (1.1.3)?
3 Integrated WBS/OBS 1.0 PC Prototype 9, Mouse, voice, Keyboard 1, Vendor Software Applications 1, Disk Storage Units 5, Microprocessor unit 1, Floppy Optical 3, Hard Drive Motor Circuit board Chassis frame Read/write Head Organization 1,860 Manufactur ing 1,450 Design Production Test Purchasing Software
4 Understanding work package effort that contributes to sub-deliverables Be able to explain cost accounts from the table below in one or two sentences each. For example, explain the cost account for Circuit Board and Production, i.e., cost, what is going on, etc. 3-4 sentences would do nicely. 10. Convert this WBS table to an OBS table. Hint: Refer back to your WBS assignment and look at the class notes for the answer. Also, ignore the arrows. They are here because I copied and pasted it from the class notes and could note get ride of the arrows.
5 5 11. You should be able to explain what the WBS and OBS mean. See the class notes for these definitions and characteristics. 12. You should be able to convey understanding about why the WBS and OBS are important. 13. Know what some of the major differences are between the WBS and the project network diagram. Refer to the WBS table on the preceding page for these questions. 14. Write out the cost account for production and the Read/Write Head. Be sure to include task activities that correspond directly with the integrated WBS/OBS a few pages back. 15. Convert this WBS (see above table) to an OBS table? What are your cost accounts? See the class notes for the OBS Table and answer on how to do this.
6 6 Assume that you have a WBS table as shown in the following diagram. 16. Show the OBS table for Electrician and Construction specialty departments in the above WBS table. Do not include purchasing in this example. If you have difficulty with this question, then see the class notes and answer page to remind yourself about this kind of question.
7 Practice Quiz #1-1 ANSWERS 7 1. What amount would you submit as a project bid to win a contract? a. Task time-phased budget. A task is not a project. b. Project rollup CORRECT c. Earned value We have not studied this concept yet. 2. True XFalse Sub-deliverables clarify the work that employees will be doing in a project. FALSE. Sub-deliverables clarify WHY we are doing particular tasks in cost accounts. 3. xtrue False A cost account clarifies who will be doing the work for a sub-deliverable. TRUE. The cost account is the intersection of OBS (who) and WBS (why, i.e., purpose) 4. Which of the following is true about the concept of a cost account? a. It is the sum of all the work package costs to produce a single sub-deliverable. b. It is the cost of the work by a single department to produce a single sub-deliverable. It is the intersection of ONE OBS department and one sub-deliverable. These questions refer to the Integrated WBS-OBS diagram 5. Explain all the cost accounts for the production unit. This will be an abbreviated answer, as by now, you are getting the idea of the cost account. Circuit board, chassis frame, and read/write head. Production does work (the work packages) to work on producing these sub-deliverables (from the design from the Design Department). 6. Which organizational unit is responsible for producing the circuit board? It is not just one unit. Four units are responsible for their contributions. They are Design, Production, Test, Software, because you can see cost accounts for all four of these departments for the circuit board. 7. How much should Design budget for its Hard Drive sub deliverables in the PC prototype? Rollup the cost accounts and you get Be able to calculate a rollup cost for various parts of this integrated WBS/OBS diagram, such as sub-deliverable 1.1 or hard drive (on the test only the work package and cost account values will be given to you). Example: What is the rollup cost for the Hard Drive (1.1.3)? 1,860
8 8 Understanding work package effort that contributes to sub-deliverables. 9. Be able to explain cost accounts from the table below in one or two sentences each. For example, explain the cost account for Circuit Board and Production, i.e., cost, what is going on, etc. 3-4 sentences would do nicely. Example: Circuit board (sub-deliverable) and Production (specialty department is a cost account with a value of 400. I.e., Circuit board has cost accounts associated with the Design, Production, Testing, and Software departments. Each of these cost accounts has work packages (people doing work), but in this example, the work packages are not shown, but you could easily do that. 10. Convert this WBS table to an OBS table. Hint: Refer back to your WBS assignment and look at the class notes for the answer. 11. You should be able to explain what the WBS and OBS mean. See the class notes for these definitions and characteristics. 12. You should be able to convey understanding about why the WBS and OBS are important. a. WBS breaks down the project into sub-deliverables and then ultimately, the tasks (work packages) that are needed to produce the sub-deliverables. The OBS shows us which department is working on the work packages to CONTRIBUTE to the sub-deliverable. 13. Know what some of the major differences are between the WBS and the project network diagram. a. WBS breaks down the project, shows the rollup total project cost and cost accounts, but it does not tell us when the project will end or calendar dates for the work packages (tasks). Network diagrams show project duration and slack and critical path and calendar dates. Refer to the WBS table on the preceding page for these questions. 14. Write out the cost account for production and the Read/Write Head. Be sure to include task activities that correspond directly with the integrated WBS/OBS a few pages back. Department Specialty Sub-Deliverable Activities Cost Production R/W Head Set up assembly 130 Calibrate tools 140 Assemble R/W Head 130 This example is the same as the last example that we worked in class to show the cost graph for the time phased budgets for the production AND Read/Write Head for the hard drive for the computer prototype. Please review notes again.
9 9 15. Convert this WBS (see above table) to an OBS table? What are your cost accounts? See the class notes for the OBS Table and answer on how to do this. Assume that you have a WBS table as shown in the following diagram. 16. Show the OBS table for Electrician and Construction specialty departments in the above WBS table. Do not include purchasing in this example. If you have difficulty with this question, then see the class notes and answer page to remind yourself about this kind of question. Department Specialty Sub-Deliverable Activities Cost Electrician Dept Electrical Planning Electrical 1200 Install Wiring 600 Drywall Cut Electrical Holes 200 Construction Dept Drywall Take Out 1280 Drywall Install New 1280 REMEMBER: The OBS starts with the department specialty, then the sub-deliverable it is working on, and then the activities to show the work that the employees are doing, and then the cost of the tasks (work packages)
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