Planning the project

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Planning the project

• Project Management
• (lecture)

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Strategic and tactical levels of planning
Hierarchy of plans

• Strategic plans
• Focus on the big picture
• Long term goals (2-5 years)
• What? Why?
• Tactical plans
• Focus on the operations
• Short term goals (1-18 months)
• How?

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Strategic and tactical levels of planning

• Strategy provides a framework for the tactics.
  Tactical plans should fit the needs of the
  strategy.
• To permit effective tactical decision making
  strategy should be
• Explicit
• Intelligible (easy to understand)
• Capable of accepting change
• Capable of being monitored
• Tactical plans on higher levels act as
  strategies for lower levels in the organisation.

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Opportunity cost

• That which is sacrificed by choosing or failing
  to adopt a different course of action to that
  which is currently planned to be taken
• the value of the next best alternative foregone
  (that is not chosen).

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The project plan

• In its simplest form it is an attempt at the
  timetable for ALL the activities which make up
  the project.
• As a minimum, it sets out
• how
• who does what
• when
• A more sophisticated plan also states
• what quality
• what cost and resources
• Its preparation is an iterative process with
  continuous reviewing and updating throughout the
  life of the project (it is never static document
  but a working tool).

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Detailing the plan

• Amount of details included should vary in time.
• Short term fully detailed
• The short-term horizon is moving forward(the
  plan become more-and-more detailed).

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Who is responsible for the project plan?

• The project manager and the project management
  team
• With the advice and assistance of
• the project sponsor
• the customer
• and other stakeholders

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Elements of project planning

• Project goals (Project SOW)
• Project product specifications, costs, quality,
  deadlines, project deliverables etc.
• Project management plan
• Work breakdown structure (WBS)
• Project network (connections of tasks)
• Responsibility assignment
• Project schedule (timetable)
• Budget (resources costs)
• Risk assessment and risk management

Iterative process
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Statement of Work (SOW)

• SOW for the whole project a detailed narrative
  description of the work required for a project.
  Can be written in the form of a legal contract,
  if we do the project for an other organisation.
• The effective SOW contains
• Introduction and background
• Technical description
• Timeline and milestones
• Client expectations
• There are SOWs for subprojects and even tasks,
  too.

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Statement of Work for the tasks within the project

• Describes the activities in the tasks in
  sufficient detail.
• Content
• estimated durations
• resources required
• costs
• measures of perfomance (performance indicators)
• risks and uncertainties
• reporting procedures

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Project deliverables (milestones)

• a list of things or activities that need to be
  delivered to meet the defined goals
• when and how each item or activity must be
  delivered
• an estimated delivery date for each item or
  activity

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Work Breakdown Structure

• Similar to the assembly (Gozinto) charts.
• A tool used to define and group a project's
  discrete work elements (tasks) in a way that
  helps organize and define the total work scope of
  the project.
• The project is divided into hierarchical groups
  of tasks (work packages, and work units).
• Tasks, work packages and work units should be
  budgetable (money, labor hours, and other
  resources).
• The technique of creating a WBS is non-uniform.

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Assembly chart (Gozinto chart) example
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Example of a WBS
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Possible levels in a WBS

• Project
• Sub-projects
• Deliverables
• Sub-deliverables
• Work packages
• Work units

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Another WBS example
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Another example of WBS Holiday
holiday
travel documents
booking
household
passport
tickets
choose resort
confirm
cat!
brochures
insurance
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Discussion question

• What is the greatest difference between a Gozinto
  and a WBS chart?

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GANTT charts

• Named after Henry Gantt (1861 - 1919) an American
  mathematical engineer.
• A Gantt chart is a type of bar chart that
  illustrates a project schedule.
• Gantt charts illustrate the start and finish
  dates of the work elements (tasks) of a project.
• Elements of a GANTT chart
• Task names
• Start and finish dates of each tasks
  (graphically)
• Dependency relationships
• Task duration in an additional column
• Lag relationships (start-to-start,
  finish-to-start etc.)
• Name of the project worker responsible for the
  task or
• Resource specifications
• other

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GANTT chart example
ID Activities Who is responsible? Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8. Time intervals 1. 2. 3. 4. 5. 6. 7. 8.
1.
2.
3.
4.
5.
6.
7.
8
9
10.
11.
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Benefits of the GANTT chart

• Easy to read and comprehend
• Easy to create
• Identify the project network coupled with its
  schedule baseline
• Allow for updating and project control
• Useful for resource planning

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Limitations

• Can become quite unwieldy for projects with too
  many activities.
• Projects are often too complex for a Gantt chart.
• Gantt charts represent only a part of the project
  constraints.
• The technique of creating a GANTT depends on the
  features of the project.

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GANTT chart example
Some Gantt charts also show the dependency
relationships between activities.
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GANTT chart example
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GANTT chart example
Gantt charts can be used to show current schedule
status using percent-complete shadings, or colour
lines and a vertical "TODAY" line.
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Readings

• Lockyer Gordon (2005) Chapter 4

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Seminar exercises
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Opportunity cost

• There are two alternative project. Only one of
  them can be selected.
• Project A has an expected net cash flow of 100.
• Project B has an expected net cash flow of 80.
• What is the opportunity cost of choosing project
  A?
• What is the opportunity cost of choosing project
  B?
• There are 3 investment opportunities with given
  expected net cash flow
• A 300 B 250 C 150.
• Only one investment can be made. Which one
  should be selected, and what is its opportunity
  cost?
• Someone has 1000 HUF. It can be deposited at a
  bank (interest is 15). What is the opportunity
  cost of not investing?

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WBS problem solving 1

• There is a marketing-research project containing
  a focus group interview and a questionnaire
  survey with 200 responders. The survey is based
  on the analysis of the focus group results.
• For the focus we have to gather the participants
  (7 days), organize the event (place, time,
  equipment etc. 2 days), implement the interview
  (1 day), record the interview (2 days), analyse
  it (3 days) and write a brief research report for
  the client/sponsor (1 day).
• For the survey we have to construct the
  questionnaire (2 days),test and modify it (1
  day), do the sampling (2 day), train the
  interviewers (1 day), fieldwork (2 days), record
  the data (1 day), analyse the data (2 days) and
  write the final study (3 days).
• The project manager want to keep a 5 days buffer
  time for safety at the end of the project.

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WBS problem solving 2

• Plot a Gozinto and a WBS chart for the next
  project
• Main task prepare lunch with 2 dishes.
• The 1st course requires 2 main groups of
  ingredients (A B) that should be bought
  separately (time to buy is 30 mins per
  ingredient-group). Cooking is 1 hr.
• The 2nd dish requires 3 group of ingredient (A, C
  D), procurement time is the same). Cooking
  needs 1.5 hrs.
• Cleaning after cooking needs 20 mins for 1
  person, 10 mins for 2 people.

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Gantt exercise

• Given the marketing research project plot a Gantt
  chart with the following information
• Task names
• Task durations
• Time schedule
• Use a backward planning (deadline is the 30th
  day) and try to reach the shortest total project
  time (TPT).

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GANTT exercise 2

• Given the WBS from the lunch-making-project and
  the additional information that there are two
  identical project workers (X and Z) who can work
  simultaneously, plot a simple GANTT chart with
  the following content
• Task names
• Time schedule (time units are 10 minutes long)
• Task durations
• Denominate the person in charge for every task
• Simultaneous work is possible.

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GANTT exercise 2

• How long is the full project?
• Denote the precedence relationships in the chart!

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GANTT exercise 3

• Show the schedule status on the GANTT chart for
  the same project after 80 minutes if
• All the A, B and C ingredients are bought, but
  the purchase of ingredient D is only 67
  complete.
• The 1st course is already half-cooked, but the
  operations on the 2nd dish could not started
  yet.

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GANTT exercise 4

• Plot a new chart with the same data but with real
  times within a day. The following information are
  added
• The market, where the ingredients should be
  bought is open only from 8 a.m. to 10 a.m. and
  the earliest is the better.
• The lunch preparations (including the cleaning)
  should be ready exactly at noun (12 a.m.).

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Thanks for the attention!