Week 02

*Lecture 02
*Article/ Case Study
* Video
 Objectives

• Triple Constraints and How to Manage Them

• The Responsibilities of a Project Manager
• Functional, Matrix and Projectized
Organizations
• Project Integration Management
Triple Constraints
Triple Constraints Process
 Project Scope Management

• The processes required to ensure that the project

includes all the work required, and only the work
required, to complete the project successfully

• Why Do We Manage Scope?

– Can’t manage schedule and budget if scope is out of control
(Triple Constraint)
– Scope docs are used to manage expectations
 Scope Management Key Points

• What is scope management

– Checking to ensure that one is completing work
– Saying No to additional work not in the charter
– Preventing extra work

• Work Breakdown Structure (WBS)

– Foundation of the project, all planning and controlling is
based on the WBS
– Identifies all work to be performed, if it is not in the WBS
it does not need to be done
– Graphical picture of work
 How Do We Manage Scope?

• Five processes
–Scope Planning
–Scope Definition
–Create WBS
–Scope Verification
–Scope Control

Scope Scope Create Scope Scope

Planning Definition WBS Verification Control
 Project Time Management

• “The processes required to accomplish timely completion

of the project”

• Why Time Management?

1. Part of triple constraint, can’t manage one without the others
(scope, time, and quality)
2. Second hardest section on the test behind integration
 How Do We Manage Time?

• Six processes
• Activity Definition
• Activity Sequencing
• Activity Resource Estimating
• Activity Duration Estimating
• Schedule Development
• Schedule Control

Activity Activity
Activity Activity Schedule Schedule
Resource Duration
Definition Sequencing Development Control
Estimating Estimating
 Project Cost Management

• Cost is a resource sacrificed or foregone to achieve a specific objective, or

something given up in exchange.

• Costs are usually measured in monetary units, such as dollars or Taka’s.

• Project Cost Management includes the processes required to ensure that the
project is completed within an approved budget.

Project Cost Management Processes

• Cost estimating: Developing an approximation or estimate of the costs of the
resources needed to complete a project.

• Cost budgeting: Allocating the overall cost estimate to individual work items
to establish a baseline for measuring performance.

• Cost control: Controlling changes to the project budget.

 Basic Principles of Cost Management
• Most members of an executive board have a better understanding and
are more interested in financial terms than IT terms, so IT project
managers must speak their language.
• Profits are revenues minus expenses.
• Life cycle costing considers the total cost of ownership, or
development plus support costs, for a project.
• Cash flow analysis determines the estimated annual costs and
benefits for a project and the resulting annual cash flow.
• Tangible costs or benefits are those costs or benefits that an
organization can easily measure in dollars.
• Intangible costs or benefits are costs or benefits that are difficult to
measure in monetary terms.
• Direct costs are costs that can be directly related to producing the
products and services of the project.
• Indirect costs are costs that are not directly related to the products
or services of the project, but are indirectly related to performing the
project.
• Sunk cost is money that has been spent in the past; when deciding
what projects to invest in or continue, you should not include sunk
costs.
 Earned value Management

The earned value Management involves developing these key values for each schedule activity, work
package, or control account:

Planned value (PV). PV is the budgeted cost for the work scheduled to be completed on an activity or
WBS component up to a given point in time.
Earned value (EV). EV is the budgeted amount for the work actually completed on the schedule activity
or WBS component during a given time period.
Actual cost (AC). AC is the total cost incurred in accomplishing work on the schedule activity or WBS
component during a given time period. This AC must correspond in definition and coverage to whatever
was budgeted for the PV and the EV (e.g., direct hours only, direct costs only, or all costs including
indirect costs).
Cost variance (CV). CV equals earned value (EV) minus actual cost (AC). The cost variance at the end
of the project will be the difference between the budget at completion (BAC) and the actual amount
spent. Formula: CV= EV - AC
Schedule variance (SV). SV equals earned value (EV) minus planned value (PV). Schedule variance
will ultimately equal zero when the project is completed because all of the planned values will have been
earned. Formula: SV = EV - PV
These two values, the CV and SV, can be converted to efficiency indicators to reflect the cost and
schedule performance of any project.
Cost performance index (CPI). A CPI value less than 1.0 indicates a cost overrun of the estimates. A
CPI value greater than 1.0 indicates a cost underrun of the estimates. CPI equals the ratio of the EV to
the AC. The CPI is the most commonly used cost-efficiency indicator. Formula: CPI = EV/AC
Schedule performance index (SPI). The SPI is used, in addition to the schedule status to predict the
completion date and is sometimes used in conjunction with the CPI to forecast the project completion
estimates. SPI equals the ratio of the EV to the PV. Formula: SPI = EV/PV
 Responsibilities and Competencies of the
Project Manager

• To satisfy the needs: task needs, team needs, and

individual needs.
• Link b/w strategy and the team.
• Effective project management requires that the project
manager possess the following competencies:
– Knowledge (Knowing about Project management)
– Performance (able to do or accomplish)
– Personal (behavior, Personal attitude, core personality and
leadership for achieving objectives and balancing the project
constraints)
 Processes of Integration Management

• Develop Project Charter.

• Develop Project Management Plan.
• Direct and Manage Project Execution.
–Change requests, deliverables
• Monitor & Control Project Work.
• Performance Report
• Perform Integrated Change Control.
• Close Project / Phase.
 What is a Project Charter?

• Formally recognizes the existence of a project.

• Refers to the business need the project is addressing.
• Describes the product to be delivered.
• Gives the project manager the authority to apply
resources to the project.
 Develop Project Charter

• Inputs:
– Project Statement of work.
– Business case.
– Agreements.
– Enterprise Environmental Factors.
– Organizational Process Assets.
• Tools & Techniques
– Expert Judgment.
– Facilitation techniques.
• Output:
– Project Charter
– Project Purpose
– High level requirements
– High level risks
– Summary milestones
– Summary budget
 Develop Project Management Plan

• Inputs:
– Project Charter.
– Outputs from other processes.
– Enterprise Environmental Factors.
– Organizational Process Assets.
• Tools & Techniques
– Expert Judgment.
– Facilitation techniques.
• Output:
– Project Management Plan.
 Direct and Manage Project work.
• Inputs:
– Project Management Plan
– Approved Change requests.
– Enterprise Environmental Factors.
– Organizational Process Assets.
• Tools & Techniques
– Expert Judgment.
– Project Management Information Systems.
– Meetings.
• Output:
– Deliverables.
– Work performance data.
– Change Requests.
– Project management plan updates.
– Project document updates.
 Monitor and Control Project work

• Inputs:
– Project Management Plan.
– Schedule forecasts.
– Cost forecasts.
– Validate changes.
– Work performance information.
– Enterprise Environmental Factors.
– Organizational Process Assets.
Monitor and Control Project work (Continued)
• Tools & Techniques
– Expert Judgment.
– Analytical techniques.
– Project Management Information Systems.
– Meetings.
• Output:
– Change requests.
– Work performance report.
– Project management plan updates.
– Project document updates.
 Perform Integrated Change Control

• Inputs:
– Project Management Plan.
– Work performance reports.
– Change requests.
– Enterprise Environmental Factors.
– Organizational Process Assets.
• Tools & Techniques
– Expert Judgment.
– Meetings.
– Change Control tools.
• Output:
– Approved Change requests.
– Change log.
– Project management plan updates.
– Project document updates.
 Close Project or phase.

• Inputs:
– Project Management Plan.
– Accepted deliverables.
– Change requests.
– Organizational Process Assets.
• Tools & Techniques
– Expert Judgment.
– Analytical techniques.
– Meetings.
• Output:
– Final product, services or result transition.
– Organizational Process assets updates.
 Government Sector Project

• Planning Commission.
• Public Sector Development Projects.
• Higher Education Commission (involved in funding of public
sector project for educational institution/university).
• Cash Plans for PSDP projects.
• Work Plans for PSDP projects.
• Approving forums.
• Project Monitoring and Evaluation System (PMES).
• Monitoring reports on quarterly basis for PSDP projects
(separate for Planning Commission and Higher Education
Commission).
PMBOK Knowledge Areas
Any Question?
Video & Case Study