Week 3 (Lec 9-13)

PROJECT MANAGEMENT: PLANNING, EXECUTION,
EVALUATION AND CONTROL

Prof. Sanjib Chowdhury
EL
Vinod Gupta School of Management
PT
IIT Kharagpur
N
Module 04: Defining the Project
Lecture 09: Responsibility Matrices and Project Communication Plan
Concepts Covered:
• Defining the Project Scope
• Establishing Project Priorities
• Creating the Work Breakdown Structure (WBS)
• Integrating the WBS with the Organization
EL
• Coding the WBS for the Information System
PT
• Responsibility Matrices
N
• Project Communication Plan
Integrating WBS with the Organization (Step 4) Illustrative
EL
Source: Project Management, Gray and Larson
PT
N
Coding WBS for Information System (Step 5) Illustrative
• WBS Coding System

‒ Defines levels, elements,
budget, cost info,
EL
consolidation of report
PT
N
PBS for Software Development Project
EL
PT
N
 What is a Responsibility Matrix? Illustrative
Responsibility Matrix for a Market Research Project
EL
PT
N
RACI Matrix Illustrative
• Responsible: Those who do the work to achieve the
task or deliverable
Project Project
Executive Steering Project • Accountable: Also known as the Approver: the one
Deliverable Sponsor Group Manager Project Team
ultimately accountable for the Project deliverables
Project charter A C R I and completion; the one who signs it off
Stakeholder workshops: agenda and • Consulted: Those whose opinions are sought and
presentation C C A R
with whom there is two-way communication
EL
• Informed: Those who are kept updated on progress,
Results of stakeholder workshops I I A R
PT
often on completion of the task or deliverable, and
Results of project voting C C A R with whom there is only one-way communication
N
Strategy table of contents I A R I
Strategy drafts C A R I
Strategy final version A C R I
Communications plan A C R I
Project management products I A R I

Project Communication Plan
 What’s the purpose?

‒ What to communicate?
‒ Whom to communicate?
EL
(what, who, how, when: info?)
PT
N
 Developing a Communication Plan
1. Stakeholder analysis
2. Information needs
‒ status report, milestone report, scope changes,
deliverable issues, change request, Team meeting,
EL
action items, Gating decision
PT
3. Sources of information
N
4. Dissemination modes
5. Responsibility and timing
Stakeholder Communications
EL
PT
N
Shale Oil Research Project Communication Plan Illustrative
EL
PT
N
Conclusion:
• In continuation with the last lecture, this class discusses the remaining steps in
defining the project, namely, (iv) integrating WBS with the organization, and (v) coding
WBS for the information system.
• It further explains process breakdown structure (PBS), which is often used for process-
EL
based projects with ill-defined deliverables. It is generally used for the software
projects.
PT
• Furthermore, the need for responsibility/RACI matrix, the importance of stakeholder
N
analysis and developing project communication plan for the success of the project
have been elucidated.
References:
1. Project Management – The Managerial Process, Gray, C.F., Larson, E.W., and
Joshi, R., McGraw Hill Education, 8th edition.
2. Project Management – Achieving Competitive Advantage, Jeffrey K. Pinto, Pearson
Publishing Ltd., 5th edition.
EL
3. Successful Project Management, Gido, J. and Clements, J.P., Cengage Learning,
PT
6th edition.
4. Project Management: A Managerial Approach, Meredith, J.R. and Mantel, S.J.,
N
Wiley, PMBOK Guidelines Book
N
PT
EL
EL
PT
IIT Kharagpur
N
Module 05. Estimating Project Time and Cost
Lecture 10: Estimating Guidelines and Methods, Top-down Estimation
Concepts Covered:
• Factors influencing the quality of estimates
• Estimating guidelines for time, cost and resource
• Top-down versus bottom-up estimation
EL
• Methods for estimating project time and cost
• Level of detail
PT
• Types of costs
N
• Refining estimates
Project Management
Estimating Projects
• What is Estimating?
• Why estimating Time and Cost are important?

(support decision, schedule work, develop budget, cash flow needs, check
progress)
EL
PT
• Types of Estimates
N
• Top-down vs. Bottom-up Estimates
Conditions for Top-Down/Bottom-up Estimates
Top-down Bottom-up
Condition Estimates Estimates
Strategic decision making X
Cost and time important X
EL
High uncertainty X
PT
Internal, small project X
Fixed-price contract X
N
Customer wants details X
Unstable scope X

Factors Influencing Quality of Estimates
Planning Horizon
Other (Non-project)
Project
Factors (equip b/d, vac.,
Duration (new tech)
N/holidays)
EL
PT
Quality of Estimates
Organization
People
N
Culture
Project Structure and

Padding
Org.(matrix, dedicated
Estimates
team)
Guidelines for Work Package Estimates – time, cost, resources
People with familiarity
Risk assessment Several people
EL
PT
Preparing Initial
Estimates
N
Contingencies Normal conditions
Independent task Time units

• What is the preferred approach for estimating time and cost?
‒ Top-down  WBS/OBS  Bottom-up  Schedule and budget 
Reconcile
EL
• Top-down Approach for Estimating Project Times and Costs
PT
• Consensus methods
• Ratio methods
N
• Apportion method
• Function point methods
• Learning curves
Apportion Method of Allocating Project Costs using WBS
EL
PT
N
Conclusion:
• This chapter deals with estimation of project time and cost. There are mainly
two types of approaches for estimating project times and costs, namely, (1)
Top-down approach such as (i) consensus methods, (ii) ratio methods, (iii)
apportion method, (iv) function point methods for software and system
EL
projects, and (v) learning curves; (2) Bottom-up approach such as (i)
template methods, (ii) parametric procedures applied to specific tasks, (iii)
PT
range estimates for the WBS work packages, and (iv) phase estimating: a
hybrid method. Top-down estimation/approach has been explained in detail.
N
References:
EL
PT
4. Project Management for Business and Technology – Principles and Practice, John
N
M. Nicholas, Prentice-Hall of India Ltd.
N
PT
EL
EL
PT
IIT Kharagpur
N
Module 05. Estimating Project Time and Cost
Lecture 11: Level of Detail, Type of Costs, and Refining Estimates
Concepts Covered:
• Factors influencing the quality of estimates
• Estimating guidelines for time, cost and resource
• Top-down versus bottom-up estimation
EL
• Methods for estimating project time and cost
• Level of detail
PT
• Types of costs
N
• Refining estimates
Project Management
 Bottom-up Approach for Estimating Project Time and Cost
• Template methods
• Parametric procedures
• Range estimates
EL
• Phase estimating
PT
N
Phase estimating over Product Life Cycle
EL
PT
N
Top-down and Bottom-up Estimates
EL
PT
N
Level of Details
• What should be the level of details?
– levels of management, project complexities
• Excessive detail
EL
– Costly, focus on dept., unproductive
PT
• Insufficient detail
N
– Costly, lacks focus, efforts on non-essential activities
Types of Cost
• Direct Costs
• Direct (Project) Overhead Costs
• General and Administrative Overhead Costs
Contract Bid Summary Costs Illustrative
EL
Direct costs $120,000
PT
Direct overhead $30,000
N
Total direct costs $150,000
G&A overhead (20%) $30,000
Total costs $180,000
Profit (15%) $27,000
Total bid $207,000
Refining Estimates
• Need for refining/adjusting estimates
• Hidden interaction costs
• Normal conditions
• Things that may go wrong
• Changes in project scope and plans
EL
• Optimistic
PT
• Strategic misrepresentation
N
• Create a Database for Estimation
Structure of a Database for Estimating Illustrative
EL
PT
N
Problem Solving
EL
PT
N
Problem Solving
EL
PT
N
N
PT
EL
Conclusion:
• In continuation with the previous lecture, this session discusses the Bottom-up
approach/estimation of time, cost and resources. It further elaborates why estimating
time and cost are important?
• It also explains the level of details - that shall be different for different levels of
management; excessive details increases unproductive paper work, and less details
EL
tend to loss focus and opportunities.
PT
• This module further illustrates that there are three types of cost associated with the
project and these are: (a) Direct costs, (b) Direct (project) overhead costs, and (c)
N
General and administrative overhead costs.
• It also elaborates the need for refining/adjusting estimates as there are hidden
interaction cost and other costs; and importance of creating a database for estimation.
References:
EL
PT
4. Project Management for Business and Technology – Principles and Practice, John
N
M. Nicholas, Prentice-Hall of India Ltd.
N
PT
EL
EL
PT
IIT Kharagpur
N
Module 06: Developing Project Plan
Lecture 12: Concept of Project Network and Network Development Rules
Concepts Covered:
• Developing Project Network
• Constructing a Project Network
• Activity-on-Node (AON), Activity-on-Arrow (AOA)
• Network Computation Process
EL
• Forward Pass and Backward Pass Computation
PT
• Level of Details for Activities
• Extended Network Techniques
N
• Concepts of Lags, Laddering, Hammock Activities
• Uncertainty in activities - three time estimates
• Probability of Completion of Project on Time
Developing a Project Plan using Network model
• What is a Network?
EL
PT
• Types of network and their characteristics
N
- AON, AOA
Terminology
EL
Fig. AOA network Rules
PT
N
Fig. AON network
Developing a Project Plan using PERT/CPM
 Critical Path Method (CPM)
• DuPont (1956/57)
• Deterministic time
• AON network
• Repetitive jobs
EL
PT
 Project Evaluation and Review Technique (PERT)
• U S Navy (1957/58)
N
• Probabilistic time
• AOA network
• Non-repetitive jobs
Constructing Project Network
 Terminology
 Activity, Event
 Merge activity
 Parallel (concurrent) activities
EL
B
 Burst activity
PT
A C
 Dummy activity
N
D
 Two approaches
A
 Critical path, Critical activities
B D
 Slack/float
C
• Basic rules to Develop Project Networks
- Network flow
- Finish-start
- Arrows
- Identification No.
EL
- Looping
PT
- Conditional statement
N
- Dangler
Conclusion:
• This chapter explains how to develop a project plan using network model. There are
two types of network viz. Activity-on-node (used by CPM), and activity-on-arrow (used
by PERT). The differences between AON and AOA network, and their applicability
have been mentioned.
EL
• It also elucidates the difference between CPM and PERT. CPM uses one time
estimate as the tasks are repetitive and activity time is fairly accurate, whereas PERT
PT
uses probabilistic or three time estimates, which will be discussed later in this module.
N
• The module further explains various terminology used for developing network plan,
and basic rules to develop project networks.
References:
EL
PT
4. Project Management, Pradeep Pai, Pearson India Education Services Pvt Ltd.,
N
2019, 1st edition.
N
PT
EL
EL
PT
IIT Kharagpur
N
Module 06: Developing Project Plan
Lecture 13: Construction of Network and Network Computation Process
Concepts Covered:
• Developing Project Network
• Constructing a Project Network
• Activity-on-Node (AON), Activity-on-Arrow (AOA)
• Network Computation Process
EL
• Forward Pass and Backward Pass Computation
PT
• Level of Details for Activities
• Extended Network Techniques
N
• Concepts of Lags, Laddering, Hammock Activities
• Uncertainty in activities - three time estimates
• Probability of Completion of Project on Time
• Practical considerations for building a project network
- Network Logic Errors

- Activity Numbering
- Use of Computers to Develop Networks
- Calendar Dates
EL
- Multiple Starts and Multiple Projects
PT
N
Network Logic Errors - Illogical Loop
• Steps for Developing Network analysis model – using PERT/CPM
- Identify tasks
- Define relationship
- Estimate time
- Assign resources
EL
- Draw network and compute CP
PT
N
Notations
Source: Optimization and Business Improvement Studies in Upstream Oil and Gas Industry,
Sanjib Chowdhury, Wiley & Sons Inc., NJ, USA.
N
PT
EL
Illustrative
Optimizing Rig Move Time and Activity Schedule using Critical Path Analysis Critical Path :
Rigging down
Source: Optimization and Business Improvement Studies in Upstream Oil and Gas Industry,
Practical
consideration
Illustrative
EL
PT
Steps
Sanjib Chowdhury, Wiley & Sons, NJ, USA.
N
Notation for Critical Path Analysis
Item Symbol Definition
Activity duration t The expected duration of an activity
Early start ES The earliest time an activity can begin if all previous
activities are begun at their earliest times
EL
Early finish EF The earliest time an activity can be completed if it
is started at its early start time
PT
Late start LS The latest time an activity can begin without
N
delaying the completion of the project
Late finish LF The latest time an activity can be completed if it

is started at its latest start time
Total slack TS The amount of time an activity can be delayed

without delaying the completion of the project
• Forward Pass Computation
- ES = EFpredecessor (max)
- EF = ES + t  next activity ES  unless merge activity (select largest EF of
preceding activities)
• Backward Pass Computation
EL
- LF = LSsuccessor (min)
- LS = LF - t  next activity LF  unless burst activity (select smallest LF of
PT
preceding activities)
N
- TS = LF - EF or
- TS = LS - ES
Problem Solving
Problem Solving
Questions
EL
PT
N
N
PT
EL
Problem Solving
Questions
EL
PT
N
N
PT
EL
Conclusion:
• In continuation with the last class, this lecture illustrates how to construct a project
network, and computation of network process.
• This includes computations of forward pass and backward pass, determining
float/slack, computing critical path, and sensitivity of network.
EL
• All these have been demonstrated by solving numerical, which will be helpful to the
students.
PT
N
References:
EL
PT
4. Project Management, Pradeep Pai, Pearson India Education Services Pvt Ltd.,
N
2019, 1st edition.
N
PT
EL

Week 3 (Lec 9-13)

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PROJECT MANAGEMENT: PLANNING, EXECUTION,

EVALUATION AND CONTROL

• WBS Coding System

Responsibility Matrix for a Market Research Project

Strategy final version A C R I

Project management products I A R I

 What’s the purpose?

• Why estimating Time and Cost are important?

Source: Project Management, Gray and Larson

Project Structure and

People with familiarity

Risk assessment Several people

Independent task Time units

Contract Bid Summary Costs Illustrative

- Network Logic Errors

Item Symbol Definition

Activity duration t The expected duration of an activity

Late finish LF The latest time an activity can be completed if it

Total slack TS The amount of time an activity can be delayed

• Backward Pass Computation

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