Prabodhan Shikshan Prasarak Sanstha’s
Rajendra Mane College of Engineering and Technology
Ambav (Devrukh)
(NAAC B+ Accredited Institute, Affiliated to University of Mumbai)
Institute Level Elective Subject: Project Management (BE SEM VIII)
Subject Code: ILO 8021
Module 3
Project Planning &
Scheduling
Subject Incharge: Dr. Rahul V. Dandage
Asso. Prof. and Head, Automobile Engineering
Department, RMCET, Ambav
Contents
• Work Breakdown structure (WBS) and linear
responsibility chart,
• Interface Co-ordination and concurrent
engineering,
• Project cost estimation and budgeting,
• Top down and bottoms up budgeting,
• Networking and Scheduling techniques.
• PERT, CPM, GANTT chart,
• Introduction to Project Management Information
System (PMIS).
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Work Breakdown structure (WBS)
WBS is an important document and can be tailored for use in a number of
different ways.
It may illustrate how each piece of the project contributes to the whole in
terms of performance, responsibility, budget, and schedule.
It may list the vendors or subcontractors associated with specific tasks.
It may be used to document that all parties have signed off on their various
commitments to the project.
It may note detailed specifications for any work package, establish account
numbers, specify hardware/software to be used, and identify resource needs.
It may serve as the basis for making cost estimates or estimates of task
duration.
Its uses are limited only by the needs of the project and the imagination of the
PM.
No one version of the WBS will suit all needs, so the WBS is not a document,
but any given WBS is simply one of many possible documents.
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Work Breakdown structure (WBS)
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Work Breakdown structure (WBS)
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Work Breakdown structure (WBS)
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Work Breakdown structure (WBS)
WBS may be useful to create an Organizational Breakdown
Structure (OBS) that displays the organizational units responsible
for each of the various work elements in the WBS, or who must
approve or be notified of progress or changes in its scope, since the
WBS and OBS may well not be identical. That is, some major
section of the WBS may be the responsibility of two or more
departments, while other sections of the WBS, two or more, say,
may all be the responsibility of one department.
Such a document can be useful for department managers to see
their total responsibilities for a particular project. The OBS is
similar to the Linear Responsibility Chart
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Linear Responsibility Chart
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Linear Responsibility Chart
In WBS, list the task breakdown in successively finer levels of detail.
Continue until all meaningful tasks or work packages have been identified
and each task or package can be individually planned, budgeted,
scheduled, monitored, and controlled.
It should be obvious that if the set of work package descriptions is not
complete and properly arranged, it is highly unlikely the project can be
completed on time, on budget, and to specification.
For each such work package, identify the data relevant to the WBS
(e.g., vendors, durations, equipment, materials, special specifi cations).
List the personnel and organizations responsible for each task. It is
helpful to construct a linear responsibility chart (sometimes called a
responsibility matrix) to show who is responsible for what.
This chart also shows critical interfaces between units that may
require special managerial coordination. With it, the PM can keep track of
who must approve what and who must report to whom.
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Interface Co-ordination
The most difficult aspect of implementing the plan for a complex
project is the coordination and integration of the various elements of the
project so that they meet their joint goals of performance, schedule, and
budget in such a way that the total project meets its goals.
As projects become more complex, drawing on knowledge and skills
from more areas of expertise -and, thus, more subunits of the parent
organization as well as more outsiders- the problem of coordinating
multidisciplinary teams (MTs) becomes more troublesome. At the same
time, and as a result, uncertainty is increased.
As the project proceeds from its initiation through the planning and
into the actual process of trying to generate the project’s deliverables, still
more problems arise.
Rather than operating as a team, they work as separate and distinct
parts, each of which has its own tasks and is not much interested in the
other parts.
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Interface Co-ordination
The intricate process of coordinating the work and
timing of the different groups is called integration
management.
The term interface coordination is used to denote the
process of managing this work across multiple groups.
The linear responsibility chart is a useful aid to the PM
in carrying out this task.
It displays the many ways the members of the project
team (which, as usual, includes all of the actors involved,
not forgetting the client and outside vendors) must interact
and what the rights, duties, and responsibilities of each
will be.
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Concurrent Engineering
Concurrent engineering (CE) has emerged as discipline to help
achieve the objectives of reduced cost, better quality, and improved
delivery performance.
CE is perceived as a vehicle for change in the way the products and
processes are designed, manufactured, and distributed.
Concurrent engineering is a management and engineering philosophy
for improving quality and reducing costs and lead time from product
conception to product development for new products and product
modifications.
CE means that the design and development of the product, the
associated manufacturing equipment and processes, and the repair tools
and processes are handled concurrently.
The concurrent engineering idea contrasts sharply with current
industry sequential practices, where the product is first designed and
developed, the manufacturing approach is then established. And finally
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approach to repair is determined.
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Concurrent Engineering
Concurrent engineering is a systematic approach to the integrated, concurrent
design of products and their related processes, including manufacture and support.
This approach is intended to cause the developers from the outset, to consider all
elements of the product life cycle from conception to disposal, including quality, cost,
schedule, and user requirements.
Why concurrent engineering?
Increasing product variety and technical complexity that prolong the product
development process and make it more difficult to predict the impact of design
decisions on the functionality and performance of the final product.
Increasing global competitive pressure that results from the emerging concept
of reengineering.
The need for rapid response to fast-changing consumer demand.
The need for shorter product life cycle.
Large organizations with several departments working on developing
numerous products at the same time.
New and innovative technologies emerging at a very high rate, thus causing
the new product to be technological obsolete within a short period.
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Concurrent Engineering
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Project Cost Estimation &
Budgeting
People use budgeting and project cost estimating interchangeably all the
time – people have the same thought in mind when thinking of one or the
other. However, the two are really each a different side of the same coin.
They are very related, but there are subtle differences between a project
budget and a project cost estimate.
Cost estimating is the process of quantifying every resource that is going
to be required to complete a project. Resources means everything – labor,
materials, land (in the case of construction), and everything else that needs to
be paid for in terms of the project. The cost estimate is a list and
quantification of all of those with a dollar amount attached to it. At the end of
the process you have a single dollar amount that represents the roll up of
everything that you’ve qualified.
Budgeting relies on that estimate. You have to have an idea of what the
cost will be before you set out to do your budgeting. Budgeting is the process
of identifying not the amounts, but the sources of the funds to be used to
cover the cost estimate.
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Project Cost Estimation
Cost estimation in project management is the process of forecasting the
financial and other resources needed to complete a project within a defined
scope. Cost estimation accounts for each element required for the project—
from materials to labor—and calculates a total amount that determines a
project’s budget. An initial cost estimate can determine whether an
organization greenlights a project, and if the project moves forward, the
estimate can be a factor in defining the project’s scope. If the cost estimation
comes in too high, an organization may decide to pare down the project to fit
what they can afford. (It is also required to begin securing funding for the
project.) Once the project is in motion, the cost estimate is used to manage all
of its affiliated costs in order to keep the project on budget.
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Project Cost Estimation
There are two key types of costs addressed by the cost estimation process:
Direct costs: These are the costs associated with a single area, such as a
department or this particular project itself. Examples of direct costs include fixed
labor, materials and equipment.
Indirect costs: These are costs incurred by the organization at large, such as
utilities and quality control.
Within these two categories, some typical elements that a cost estimation will
take into account include:
Labor: the cost of project team members working on the project, both in terms
of wages and time.
Materials and equipment: The cost of resources required for the project, from
physical tools to software to legal permits.
Facilities: the cost of using any working spaces not owned by the organization.
Vendors: the cost of hiring third-party vendors or contractors.
Risk: the cost of any contingency plans implemented to reduce risk.
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Top Down Budgeting
This strategy is based on collecting the judgments and experiences of top
and middle managers, and available past data concerning similar activities.
These managers estimate overall project cost as well as the costs of the major
subprojects that comprise it. These cost estimates are then given to lower-
level managers, who are expected to continue the breakdown into budget
estimates for the specific tasks and work packages that comprise the
subprojects. This process continues to the lowest level.
The budget, like the project, is broken down into successively finer
detail, starting from the top, or most aggregated level following the WBS. It
is presumed that lower-level managers will argue for more funds if the
budget allocation they have been granted is, in their judgment, insufficient
for the tasks assigned. This presumption is, however, often incorrect. When
senior managers insist on maintaining their budgetary positions—based on
“considerable past experience”—junior managers feel forced to accept what
they perceive to be insufficient allocations to achieve the objectives to which
they must commit.
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Bottom Up Budgeting
In this method, elemental tasks, their schedules, and their individual
budgets are constructed, again following the WBS. The people doing the
work are consulted regarding times and budgets for the tasks to ensure the
best level of accuracy. Initially, estimates are made in terms of resources,
such as labor hours and materials. These are later converted to dollar
equivalents.
Standard analytic tools such as learning curve analysis (discussed in the
next section) and work sampling are employed where appropriate to improve
the estimates. Differences of opinion are resolved by the usual discussions
between senior and junior managers. If necessary, the project manager and
the functional manager(s) may enter the discussion in order to ensure the
accuracy of the estimates. The resulting task budgets are aggregated to give
the total direct costs of the project. The PM adds such indirect costs as
general and administrative (G&A), possibly a project reserve for
contingencies, and then a profit figure to arrive at the final project budget.
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Top Down Vs. Bottom Up Budgeting
The advantage of the top-down process is that aggregate budgets can often be
developed quite accurately, though a few individual elements may be significantly in
error. Not only are budget categories stable as a percent of the total budget, the
statistical distribution of each category (e.g., 5 percent for R & D) is also stable,
making for high predictability. Another advantage of the top-down process is that
small yet costly tasks need not be individually identified, nor need it be feared that
some small but important aspect has been overlooked. The experience and judgment
of the executive is presumed automatically to factor all such elements into the
overall estimate. Questions put to subordinates, however, indicate that senior
management has a strong bias toward underestimating costs.
The advantages of the bottom-up process are those generally associated with
participative management. Individuals closer to the work are apt to have a more
accurate idea of resource requirements than their superiors or others not personally
involved. In addition, the direct involvement of low-level managers in budget
preparation increases the likelihood that they will accept the result with a minimum
of grumbling. Involvement also is a good managerial training technique, giving
junior managers valuable experience in budget preparation as well as the knowledge
of the operations required to generate a budget.
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Networking and Scheduling Techniques
• Gantt Chart
• Network Analysis-
CPM (Critical Path Method) &
PERT(Project/Program Evaluation and Review
Technique)
Numerical Problems regarding:
- Draw network diagram, determine critical path and estimate
project duration.
- Three time estimates (to,tm and tp)
- Determining Floats and Slacks for network
- Crashing the activities
- Resource Levelling
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Gantt Chart
• One of the oldest but still one of the most useful methods of presenting project schedule
information is the Gantt chart, developed around 1917 by Henry L. Gantt, a pioneer in the
field of scientific management.
• The Gantt chart shows planned and actual progress for a number of tasks displayed as bars
against a horizontal time scale. It is a particularly effective and easy-to-read method of
indicating the actual current status for each of a set of tasks compared to the planned
progress for each item of the set.
• As a result, the Gantt chart can be helpful in expediting, sequencing, and reallocating
resources among tasks, as well as in the valuable but routine job of keeping track of how
things are going.
• In addition, the charts usually contain a number of special symbols to designate or
highlight items of special concern to the situation being charted.
• There are several advantages to the use of Gantt charts. They may contain a great deal of
information but they are easily understood. Gantt charts provide a picture of the current
state of a project.
• Gantt charts have a serious weakness that If a project is complex with a large set of
activities, it may be very difficult to follow multiple activity paths through the project.
Gantt charts are powerful devices for communicating to senior management, but networks
are usually more helpful in the hands-on task of managing the project.
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Gantt Chart (Sample)
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Project Management Information
System (PMIS)
• No project can be effectively managed without a PMIS to plan,
control and integrate the people and the work. This information
system will consist of several information subsystems, of which
planning is only one. It is essential that these subsystem information
modules be integrated. This integration is far easier than it used to
be, with a large, quickly accessible relational database at the heart
of the information system.
• Within this system, any of the better modern project management
software packages can play a vital role in that, when appropriately
chosen and operated, it can consolidate several information
subsystems (such as cost management, earned value analysis and
reporting) into one.
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Project Management Information
System (PMIS)
• Any PMIS will be built from a number of subsystems or modules.
These modules will vary with the industry, individual project
requirements and the particular company.
• Information modules can be divided into primary and secondary, on
the simple basis that the primary modules are essential, to be used
on every project, whilst the secondary modules are optional, to be
used only on selected projects.
• Opinions will differ on which modules should be primary and
which secondary, and there will be no correct division as such
because everything will depend on the circumstances.
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Project Management Information
System (PMIS)
Primary modules could include the Secondary modules might include:
following: • risk analysis
• project structuring and coding
• contract administration
• change control
• design • correspondence
• estimating • safety
• materials management • work packs
• planning
• contract brief.
• budgeting or cost management
• quality
• data acquisition (accounting,
payroll, measurement)
• analysis and reporting.
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Design of Project Management
Information System (PMIS)
• The PMIS needs to be purpose-designed to ensure that the individual modules are
effective and integrated. This design and implementation should be relatively
easy compared with the same task a few years ago, owing to the following
factors:
• The methodology of project management is well established.
• Computer hardware and software is relatively cheap, user-friendly, with adequate
speed and power.
• There is a wider choice of project management software packages, many of
which are versatile, multi-functional and reasonably priced.
• Communications between computers is easier and there is more compatibility
between different software packages.
• Experience in the design and implementation of systems is widespread and help
can be obtained from package suppliers and consultants.
• Database management information packages are widely available, used by many
firms, and most modem project management packages are designed to interface
with them.
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Benefits of Project Management
Information System (PMIS)
• The PMIS is a source of power for the project manager. It enhances
the project manager's planning power and, since the project
manager is responsible for reporting progress to higher
management, this gives him or her the ear of these higher power
sources, thereby enhancing his or her personal power.
• The project manager is also at the centre of the information system
and has the power to call, chair and minute meetings. These factors
are recognized sources of power.
• Thus the planning and control system can give the project manager
the geater source of political power over all the diverse individuals,
groups and companies working on the project - provided that he or
she knows how to use it as such.
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References
• Guide to Project management Body of Knowledge
(PMBOK Guide), fifth edition, Project
Management Institute, 2013
• Jack Meredith, Samual Mantel (2009) Project
Management: A managerial approach, 7th Edition.
• Prsanna Chandra (2002) Projects: Planning,
Analysis, Financing, Implementation and Review,
5th Edition, TMH publications, pp. 183-222
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Dr. Rahul V. Dandage
Asso. Prof. and Head, Automobile Engineering
Department, RMCET, Ambav
Whatsapp-9975171527
Email: [Link]@[Link]/
hodauto@[Link]
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