Project cost management
Work Break down structure cost
No Activity description Cost
PDN001 Construction of building
Iron beams
Cement Rs. 2000
Bricks
Wood
Gravel
PDN002 Office equipment
Stationery Rs 1000
Copying machines
PDN003 Computers Rs. 1000
PDN004 Music system Rs. 1500
PDN005 Generator + switch Rs. 800
PDN006 Furniture Rs. 1200
PDN007 AC + Switch Rs. 750
PDN008 Interior Décor Rs. 1000
PDN009 Heaters Rs. 500
PDN010 Guitars Rs.500
PDN011 Piano Rs.500
PDN012 Drums Rs.500
PDN013 Violin Rs.500
PDN014 Saxophone Rs.500
PDN015 Recording system Rs. 1000
Total Cost Rs. 13,250
No Activity description Cost
PCT001 Construction of building
Iron beams
Cement Rs. 850,000
Bricks
Wood
Gravel
PCT002 Office equipment
Stationery Rs 100,000
Copying machines
PCT003 Computers Rs. 100,000
PCT004 Music system Rs. 100,000
Music player
Speakers
PCT005 Generator + switch Rs. 100,000
PCT006 Furniture Rs. 120,000
PCT007 AC + Switch Rs. 150,000
PCT008 Interior Décor Rs.250,000
PCT009 Heaters Rs. 75,000
PCT010 Guitars Rs.115,000
PCT011 Piano Rs.125,000
PCT012 Drums Rs.100,000
PCT013 Violin Rs.100,000
PCT014 Saxophone Rs.120,000
PCT015 Recording system Rs. 175,000
Total Cost Rs. 2,480,000
Code Activity description Cost
LPN001 Design layout Rs. 250,000
LPN002 Design Document Rs. 50,000
LPN003 Get Approval Nil
Total Rs. 300,000
Activity code Activity description Cost
IMP001 Appoint Workers Rs. 135,000
IMP002 Construction of Building Rs. 2,500,000
IMP003 Office equipment Rs. 5000
IMP004 Computers Rs. 5000
IMP005 Music system Rs. 3000
IMP006 Generator + switch Rs. 5000
IMP007 Furniture Rs. 2000
IMP008 AC + Switch Rs. 5000
IMP009 Interior Décor Rs. 50,000
IMP010 Heaters Rs. 15,000
IMP011 Guitars Rs. 5000
IMP012 Piano Rs. 5000
IMP013 Drums Rs. 5000
IMP014 Violin Rs. 5000
IMP015 Saxophone Rs. 5000
IMP016 Recording system Rs. 35,000
IMP017 Hand over the project Nil
Total cost Rs. 2,785,000
Cost control
Planned value
Total project budget = Rs. 10,000,000
Duration of project = 12 months
Planned value = 10000000/12 = Rs. 833,333
Earned value
Work completed till date = 3.5%
Total budget = Rs. 10,000,000
Earned value = 0.035 × 10000000 = Rs. 350,000
Cost variances
Amount spent (as shown) = 350,000
Amount actually spent = 380,000
Cost variance =CV = Amount spent – earned value = 380000 – 350000 = 30,000
Cost performance index
30000/380000 = 0.078 = 7.8%
In other words, 1.08
For every rupee spent, 0.08 extra is being spent.
Schedule Performance Index (SPI)
SPI = EV/PV = 350000/833333 = 0.42
Because the index isn’t very close to 1, the project isn’t very good.
Human resource management
Organizational structure
Project
Director
Operations Procurement Finance
Manager HR Manager
Manager Manager
Supervisors Field officers Book-keeper HR Officer
Accountant
Recruitment and selection
For recruiting employees, an ad will be given to various daily news papers. Once candidates have
responded to the advertisement, they will be selected on the basis of their experience in the
relevant field. An interview will be conducted in order to find out about their skills and competency.
Training and development
The training of the employees will be carried out as per the requirement of the project. This will help
the project team in performing the day to day activities.
Rewards
The project team will be rewarded on the base of their performance. This means that the work
should have quality and should be timely.
Allocation
All candidates that have been successfully selected will be placed in appropriate positions. The
following table shows the pre-allocated positions
Manager Role
Mr. Riffat Abbas Rizvi Project director
Mr. Muhammad Zeeshan Haider Project manager
Ms. Noor Rauf Rathore Project manager
Ms. Hira Tanvir Project manager
Ms. Hamna Khalid Project manager
Ms. Mishail Imran Project manager
Ms. Momina Nazir Project manager
Pay schedule
[Link] Designations Pay range
1 Technical staff and front line managers Rs. 5,000 to 20,000
2 OG-1 Rs. 35,000 to 50,000
3 OG-2 Rs. 75,000 to100,000
4 OG-3 Rs. 150,000 to 200,000
5 OG-4 Rs. 200,000 to 250,000
Project communication management
The communication plan
Effective communication is the boon of any organization. The flow of communication will follow the
organization’s hierarchy. The following will be the media of communication in the project
Telephone
E-mail
Office memos
Project meetings
Information distribution
The information will be disseminated through monthly progress reports which will be sent to all
concerned parties. Feedback will be obtained and changes will be made accordingly.
Performance reporting
The performance of the team members will be recorded in performance reports. These will be
handed to the project director. The result of this would be a report that contains performance
analyses of each team member.
Managing Stakeholders
A bimonthly meeting will be held with all stakeholders present. They will be brought up to date with
all the happenings in this meeting. The organization will consider the recommendations presented
by the various stakeholders. Other than that, monthly reports will be sent to stakeholders through
email.
Procurement management
Type of contract
The type of contract that firm will enter will be fixed-price contract.
Under this contract, the sellers will provide the various goods required at the Prices quoted
in the contract.
The contract will be legally binding for all parties involved.
Items to be procured
Items to be procured
Office equipment
Computers
Music system
Generator + switch
Furniture
AC + Switch
Interior Décor
Heaters
Guitars
Piano
Drums
Violin
Saxophone
Recording system
Quantity to be procured
Items to be procured Quantity
Office equipment As per requirement
Computers 6
Music system 1
Generator + switch 1
Furniture As per requirement
AC + Switch As per requirement
Interior Décor Items As per requirement
Heaters As per requirement
Guitars 5
Piano 5
Drums 5
Violin 5
Saxophone 2
Recording system 1
Stages of procurement
Stage 1 In this stage, the construction materials will be purchased so that construction can be
initiated. This stage will take 8 months to complete.
Stage 2 Once the facility is constructed, the generator, heating and cooling systems and items of
decor would be acquired. This stage will take 2 months.
Stage 3 in this stage the decor items as well as musical instruments and music and recording systems
will be procured. This will take 1 month.
Procurement form
Date of issue Date of expiry lading date
Item
Code
Items
Description
Warehouse
Details
Vendors signature Receivers detail and Signature
Project Risk Management
First, it needs to be seen whether the risk attached to various activities is qualitative or quantitative.
No Price Determination Qualitative Quantitative
PRICE DETERMINATION of
PDN001
Land/Building
PRICE DETERMINATION of Office
PDN002
equipment
PDN003 PRICE DETERMINATION of computers
PRICE DETERMINATION of music
PDN004
system
PRICE DETERMINATION of generator +
PDN005
switch
PDN006 PRICE DETERMINATION of furniture
PRICE DETERMINATION of AC +
PDN007
Switch
PRICE DETERMINATION of Interior
PDN008
Décor
PDN009 PRICE DETERMINATION of heaters
PDN010 PRICE DETERMINATION of guitars
PDN011 PRICE DETERMINATION of Piano
PDN012 PRICE DETERMINATION of drums
PDN013 PRICE DETERMINATION of Violin
PDN014 PRICE DETERMINATION of Saxophone
PRICE DETERMINATION of Recording
PDN015
system
No Procurement Qualitative Quantitative
PCT001 PROCUREMENT of Land/Building
PROCUREMENT of Office
PCT002
equipment
PCT003 PROCUREMENT of computers
PCT004 PROCUREMENT of music system
PROCUREMENT of generator +
PCT005
switch
PCT006 PROCUREMENT of furniture
PCT007 PROCUREMENT of AC + Switch
PCT008 PROCUREMENT of Interior Décor
PCT009 PROCUREMENT of heaters
PCT010 PROCUREMENT of guitars
PCT011 PROCUREMENT of Piano
PCT012 PROCUREMENT of drums
PCT013 PROCUREMENT of Violin
PCT014 PROCUREMENT of Saxophone
PCT015 PROCUREMENT of Recording
system
No Lay out Plan Qualitative Quantitative
LPN001 Design layout
LPN002 Design Document
LPN003 Get Approval
No Implementation Qualitative Quantitative
IMP001 Appoint Workers
IMPLEMENTATION of
IMP002
Land/Building
IMPLEMENTATION of Office
IMP003
equipment
IMP004 IMPLEMENTATION of computers
IMP005 IMPLEMENTATION of music system
IMPLEMENTATION of generator +
IMP006
switch
IMP007 IMPLEMENTATION of furniture
IMP008 IMPLEMENTATION of AC + Switch
IMPLEMENTATION of Interior
IMP009
Décor
IMP010 IMPLEMENTATION of heaters
IMP011 IMPLEMENTATION of guitars
IMP012 IMPLEMENTATION of Piano
IMP013 IMPLEMENTATION of drums
IMP014 IMPLEMENTATION of Violin
IMP015 IMPLEMENTATION of Saxophone
IMPLEMENTATION of Recording
IMP016
system
IMP017 Hand over the project
Nature of risk
S. no Risk factors Likelihood of Impact
occurrence
1 Raw material delay Low Project delay
Increased cost
Goodwill affected
2 Delay in getting approval from CDA Medium Late start of project
Renewal of contract
issues
3 Delay in the interior decoration Low Poor layout
Poor ambience
4 Unavailability of instructors Medium Late project start
Lack of competent
workforce
5 Unavailability of manual labour Medium Unable to meet deadline
Quality issues
6 Insufficient funds Low Default risk
Procurement issues
Inability to meet
deadlines
7 Political instability High Project completion
issues
8 Inability to meet deadlines Medium Bad repute
Completion issues
Risk Mitigation
S. no Risk factors Risk mitigation
1 Raw material delay Multiple suppliers
Purchase all materials
beforehand.
2 Approval from CDA Apply for approval before
beginning
3 Delay in the interior decoration Multiple suppliers
4 Unavailability of instructors Advertise nationwide
5 Unavailability of manual labour Hire contractor
6 Unavailability of funds Try cutting extra costs
7 Political Instability Make contingency plans
8 Inability to meet deadlines Cut down on time consuming
activities.
Try to finish all work prior to
end dates