Subject: Project Management

Topic: Planning Projects

Difficulty: Medium

There are many different types of estimation techniques used in project management with various streams as Engineering, IT, Construction, Agriculture, Accounting etc. A Project manager is often challenged to align mainly six project constraints - Scope, Time, Cost, Quality, Resources and Risk in order to accurately estimate the project. The common questions that come into the mind of a project manager at the start of the project is –

how much work is to be estimated (scope),

how to estimate the project (techniques),

how much time it will require to complete the project (Schedule),

who will be doing the project (resources),

what is the budget required to deliver the project (cost), and

Any intermediary dependencies that may delay or impact the project (Risks).

There are 3 major parts to project estimation mainly:-

Effort estimation,Cost estimation, andResource estimateWhile accurate estimates are the basis of sound project planning, there are many techniques used as project management best practices in estimation as - Analogous estimation, Parametric estimation, Delphi method, 3 Point Estimate, Expert Judgment, Published Data Estimates, Vendor Bid Analysis, Reserve Analysis, Bottom Up Analysis, and Simulation. Usually, during the early stages of a project life cycle, the project requirements are feebly known and less information is available to estimate the project. The initial estimate is drawn merely by assumptions knowing the scope at a high level, this is known as ‘Ball-park estimates’, a term very often used by project managers.

Top-down estimate:

Once more detail is learned on the scope of project, this technique is usually followed where high level chunks at the feature or design level is estimated and is decomposed progressively into smaller chunks or work-packets as information is detailed.

Bottom-up estimate:

This technique is used when the requirements are known at a discrete level where the smaller work pieces are then aggregated to estimate the entire project. This is usually used when the information is only known in smaller pieces.

Analogous estimating:

This technique is used when there is a reference of similar project executed and it is easy to correlate with other projects. Expert judgement and historical information of similar activities in referenced project is gathered to arrive at an estimate of the project.

Parametric estimate:

This technique uses independent measurable variables from the project work. For example, the cost for construction of a building is calculated based on the smallest variable as the cost to build a square feet area, effort required to build a work packet is calculated from the variable as lines of codes in a software development project. This technique gives more accuracy in project estimation.

Three point estimating:

This technique uses a mathematical approach as the weighted average of optimistic, most likely and pessimistic estimate of the work package. This is often known as the PERT (Program Evaluation and Review Technique).

What if analysis:

This technique uses assumptions based on varying factors as scope, time, cost, resources etc., to evaluate the possible outcomes of the project by doing an impact analysis. In a usual scenario, the project estimate is done by conducting estimation workshops with the stakeholders of the project, senior team members who could give valuable inputs to the estimation exercise. The high level scope is broken down into smaller work packages, components and activities, each work package is estimated by effort and resource needed to complete the work package. The project may be detailed into the smallest chunk that can be measured. The following activities are done during the workshop:

Break down the scope into smallest work package, components or activities (WBS)

Sequence the activities in the order in which they will be performed

Identify the effort required to complete each activity

Identify the resource estimate to complete each task or activity

Identify the dependencies to complete each activity

Identify the possible risks and assumptions

Define the resource and cost estimate to completion of each activity, component and work package

The above exercise gives an exact estimate of the project and the outcome of the workshop may be a project plan and a project schedule with effort, resource and cost estimates.

PMP is a registered trademark of the Project Management Institute, Inc.

Effective leadership is mentioned in the 5th edition but is now being consolidated into one section. Consider this as a continuation of PMI’s message—a call to action that Project Management has three components that aspiring professionals need to continually develop: technical project management, business acumen, and leadership.

Terminology Changes

Time Management will become Schedule Management. This makes sense; we don’t manage time, but we manage and control our schedule.

The structure of the Knowledge Areas will be updated, with the following details:

Key Concepts will be organized. You can look to a specific section to review the core message of the knowledge area.Trends and Emerging Practices have been added. Current learnings and business behavior are now seen to be a component that you can integrate and are expected to consider. The guide is not something static, but something that we can modify based on needs inside and outside the project. It is moved closer to a dynamic set of tools supported by thoughtful analysis as well as best practice.

All these updates support not only increased clarity but also provide a focus on how this material can be best applied. This is the core of the PMP Certification Exam; it tests not only one’s knowledge but how well the applicant can apply what they know as a best practice in ambiguous, often confusing situations.

This bodes well for the profession of project management, and it bodes well for us, too. The guide gives us not only what we need to do today to make projects and business better, but what we need to think about and prepare for the future. Project management and our careers within it are a continuing story, not a stairway that ends with a closed door.

project Scheduling

The project schedule is the tool that communicates what work needs to be performed, which resources of the organization will perform the work and the timeframes in which that work needs to be performed. The project schedule should reflect all of the work associated with delivering the project on time. Without a full and complete schedule, the project manager will be unable to communicate the complete effort, in terms of cost and resources, necessary to deliver the project. Online project management software allows project managers to track project schedules, resources, budgets and project related assets in real time. The project schedule can be viewed and updated by team members associated with the project, keeping everyone well informed on the overall project status.

Work Breakdown Structure (WBS)

The building blocks of a schedule start with a Work Breakdown Structure (WBS). The WBS is a hierarchical reflection of all the work in the project in terms of deliverables. In order to produce these deliverables, work must be performed.

A typical approach in developing a WBS is to start at the highest level, with the product of the project. For example, you are assigned as the project manager of a New Product Development project. The new product you are developing is a new toy for children age's five through nine. The objective of this product development project is to increase the revenue of the organization by ten percent.

Example of WBS:

Work Breakdown Structure

Above is an example of a WBS for this new toy. Each level of the WBS is a level of detail created by decomposition. Decomposition is the process of breaking down the work into smaller, more manageable components. The elements at the lowest level of the WBS are called tasks. In the example above, brochures, advertising and commercials are all work packages or tasks.

Marketing collateral is on a summary level called a control account in project management parlance. In Project Insight, project management software, control accounts are called 'summary tasks.' Summary tasks are roll ups of the tasks underneath them.

The decomposition of a schedule will continue at varying rates. 'Brochures' is a task identified at the fourth level of decomposition, while the 'marketing plan' is also a task, but defined at the third level of decomposition.

As a project manager, the level of decomposition will be dependent on the extent to which you will need to manage. Project Insight supports as many levels of hierarchy as are needed. The expectation is that each task will have a single owner and the owner is expected to manage and report on the work necessary to deliver the task. In Project Insight, this is called the 'task owner.' If you cannot assign a single owner, or you need to have additional visibility into the progress of that task, additional decomposition is recommended.

Once all the deliverables of the project have been identified, tasks will be performed in order to create the deliverables. In some cases, these activities are the physical deliverables, but in other cases they are the actions that need to be performed. A physical deliverable, for example, might be an image (an actual file) that is needed for the brochure. Listing out each of the tasks to be performed will result in an activity list as demonstrated below