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Project Management

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Project Management ­MGMT627
VU
LESSON 23
WORK BREAKDOWN STRUCTURE
BROAD CONTENTS
Preparation Guides for Work Breakdown Structure (WBS)
Checklists for Preparing Work Breakdown Structure (WBS)
Methods for Structuring Work Breakdown Structure (WBS)
Why Do Plans Fail?
23.1
Preparation Guides for Work Breakdown Structure (WBS):
We have already discussed the preparation guides for the Statement of Work (SOW). Similarly
there are several preparation guides for the Work Breakdown Structure (WBS). These are as
follows:
Firstly, develop the Work Breakdown Structure (WBS) structure by subdividing the total
effort into discrete and logical sub elements. Usually a program subdivides into projects,
major systems, major subsystems, and various lower levels until a manageable -size
element level is reached. Wide variations may occur, depending upon the type of effort
(e.g., major systems development, support services, etc.). Include more than one cost center
and more than one contractor if this reflects the actual situation.
It is important to check the proposed Work Breakdown Structure (WBS) and the
contemplated efforts for completeness, compatibility, and continuity.
Determine that the Work Breakdown Structure (WBS) satisfies both functional
(engineering/ manufacturing/ test) and program/project (hardware, services, etc.)
requirements, including recurring and nonrecurring costs.
Remember to check to determine if the Work Breakdown Structure (WBS) provides for
logical subdivision of all project work.
Establish assignment of responsibilities for all identified effort to specific organizations.
Finally, check the proposed Work Breakdown Structure (WBS) against the reporting
requirements of the organizations involved.
23.2
Checklists for Preparing Work Breakdown Structure (WBS):
In addition to the preparation guides, there are also checklists that can be used in the preparation
of the Work Breakdown Structure (WBS):
Focus to develop a preliminary Work Breakdown Structure (WBS) to not lower than the top
three levels for solicitation purposes (or lower if deemed necessary for some special
reason).
Remember to assure that the contractor is required to extend the preliminary Work
Breakdown Structure (WBS) in response to the solicitation, to identify and structure all
contractor work to be compatible with his organization and management system.
Following negotiations, the Contract Work Breakdown Structure (CWBS) included in the
contract should not normally extend lower than the third level.
It is essential to assure that the negotiated Contract Work Breakdown Structure (CWBS)
structure is compatible with reporting requirements.
Assure that the negotiated Contract Work Breakdown Structure (CWBS) is compatible with
the contractor's organization and management system.
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Review the Contract Work Breakdown Structure (CWBS) elements to ensure correlation
with the following:
The specification tree
o
Contract line items
o
End-items of the contract
o
Data items required
o
Work statement tasks
o
Configuration management requirements
o
Also, define Contract Work Breakdown Structure (CWBS) elements down to the level
where such definitions are meaningful and necessary for management purposes (WBS
dictionary).
Clearly specify reporting requirements for selected Contract Work Breakdown Structure
(CWBS) elements if variations from standard reporting requirements are desired.
Always assure that the Contract Work Breakdown Structure (CWBS) covers measurable
effort, level of effort, apportioned effort, and subcontracts, if applicable.
Lastly, Assure that the total costs at a particular level will equal the sum of the costs of the
constituent elements at the next lower level.
In case of simple projects, the Work Breakdown Structure (WBS) can be constructed as a "tree
diagram" or according to the logic flow. The tree diagram can follow the work or even the
organizational structure of the company (i.e., division, department, section, unit). The second
method is to create a logic flow and cluster certain elements to represent tasks and projects. In
the tree method, lower-level functional units may be assigned to one, and only one.
Figure 23.1: Work Breakdown Structure (WBS) Elements
23.3
Methods for Structuring Work Breakdown Structure (WBS):
It is seen that a tendency exists today to develop guidelines, policies, and procedures for project
management, but not for the development of the Work Breakdown Structure (WBS). Since it
must have flexibility built into it, the tendency is to avoid limiting the way the Work
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Breakdown Structure (WBS) must be developed. Some companies have been marginally
successful in developing a "generic" methodology for levels 1, 2, and 3 of the Work Breakdown
Structure (WBS). In other words, the top three levels of the Work Breakdown Structure (WBS)
are the same for all projects. The differences appear in levels 4, 5, and 6.
The following table 23.1 shows the three most common methods for structuring the Work
Breakdown Structure (WBS):
Table 23.1: Three Common Methods for Structuring the WBS
As the table shows, the flow method breaks the work down into systems and major subsystems.
This method is well suited for projects less than two years in length. For longer-duration
projects, we use the life-cycle method, which is similar to the flow method. The organization
method is used for projects that may be repetitive or require very little integration between
functional units.
23.4
Why Do Plans Fail?
Planning is not perfect, no matter how hard we try, and sometimes plans fail. Typical reasons
why plans fail include:
Corporate goals are not understood at the lower organizational levels.
Plans encompass too much in too little time.
Financial estimates are poor.
Plans are based on insufficient data.
No attempt is made to systematize the planning process.
Planning is performed by a planning group.
No one knows the ultimate objective.
No one knows the staffing requirements.
No one knows the major milestone dates, including written reports.
Project estimates are best guesses, and are not based on standards or history.
Not enough time is given for proper estimating.
No one bothers to see if there would be personnel available with the necessary skills.
People are not working toward the same specifications.
People are consistently shuffled in and out of the project with little regard for schedule.
Now the question arises, why do these situations occur, and who should be blamed? If corporate
goals are not understood, it is because corporate executives are negligent in providing the
necessary strategic information and feedback. If a plan fails because of extreme optimism, then
the responsibility lies with both the project and line managers for not assessing risk. Project
managers should ask the line managers if the estimates are optimistic or pessimistic, and expect
an honest answer. Erroneous financial estimates are the responsibility of the line manager. If the
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project fails because of a poor definition of the requirements, then the project manager is totally
at fault.
It is important that the project managers must be willing to accept failure. Sometimes, a
situation occurs that can lead to failure, and the problem rests with either upper-level
management or some other group. As an example, consider the major utility company with a
planning group that prepares budgets (with the help of functional groups) and selects projects to
be completed within a given time period. A project manager on one such project discovered that
the project should have started ''last month" in order to meet the completion date. In cases like
this, project managers will not become dedicated to the projects unless they are active members
during the planning and know what assumptions and constraints were considered in
development of the plan.
In some cases, sometimes, the project manager is part of the planning group and as part of
feasibility study is asked to prepare, with the assistance of functional managers, a schedule and
cost summary for a project that will occur three years downstream, if it is approved at all.
Suppose that three years downstream the project is approved. How does the project manager get
functional managers to accept the schedule and cost summary that they themselves prepared
three years before? It cannot be done, because technology may have changed, people may be
working higher or lower on the learning curve, and salary and raw material escalation factors
are inaccurate.
Small mistake accumulate to cause big damage. Sometimes project plans fail because simple
details are forgotten or overlooked. Examples of this might be:
Neglecting to tell a line manager early enough that the prototype is not ready and that
rescheduling is necessary.
Neglecting to see if the line manager can still provide additional employees for the next two
weeks because it was possible to do so six months ago.
In addition to this, sometimes plans fail because the project manager "bites off more than he can
chew," and then something happens, such as his becoming ill. Even if the project manager is
effective at doing a lot of the work, overburdening is unnecessary. Many projects have failed
because the project manager was the only one who knew what was going on and then got sick.
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Table of Contents:
  1. INTRODUCTION TO PROJECT MANAGEMENT:Broad Contents, Functions of Management
  2. CONCEPTS, DEFINITIONS AND NATURE OF PROJECTS:Why Projects are initiated?, Project Participants
  3. CONCEPTS OF PROJECT MANAGEMENT:THE PROJECT MANAGEMENT SYSTEM, Managerial Skills
  4. PROJECT MANAGEMENT METHODOLOGIES AND ORGANIZATIONAL STRUCTURES:Systems, Programs, and Projects
  5. PROJECT LIFE CYCLES:Conceptual Phase, Implementation Phase, Engineering Project
  6. THE PROJECT MANAGER:Team Building Skills, Conflict Resolution Skills, Organizing
  7. THE PROJECT MANAGER (CONTD.):Project Champions, Project Authority Breakdown
  8. PROJECT CONCEPTION AND PROJECT FEASIBILITY:Feasibility Analysis
  9. PROJECT FEASIBILITY (CONTD.):Scope of Feasibility Analysis, Project Impacts
  10. PROJECT FEASIBILITY (CONTD.):Operations and Production, Sales and Marketing
  11. PROJECT SELECTION:Modeling, The Operating Necessity, The Competitive Necessity
  12. PROJECT SELECTION (CONTD.):Payback Period, Internal Rate of Return (IRR)
  13. PROJECT PROPOSAL:Preparation for Future Proposal, Proposal Effort
  14. PROJECT PROPOSAL (CONTD.):Background on the Opportunity, Costs, Resources Required
  15. PROJECT PLANNING:Planning of Execution, Operations, Installation and Use
  16. PROJECT PLANNING (CONTD.):Outside Clients, Quality Control Planning
  17. PROJECT PLANNING (CONTD.):Elements of a Project Plan, Potential Problems
  18. PROJECT PLANNING (CONTD.):Sorting Out Project, Project Mission, Categories of Planning
  19. PROJECT PLANNING (CONTD.):Identifying Strategic Project Variables, Competitive Resources
  20. PROJECT PLANNING (CONTD.):Responsibilities of Key Players, Line manager will define
  21. PROJECT PLANNING (CONTD.):The Statement of Work (Sow)
  22. WORK BREAKDOWN STRUCTURE:Characteristics of Work Package
  23. WORK BREAKDOWN STRUCTURE:Why Do Plans Fail?
  24. SCHEDULES AND CHARTS:Master Production Scheduling, Program Plan
  25. TOTAL PROJECT PLANNING:Management Control, Project Fast-Tracking
  26. PROJECT SCOPE MANAGEMENT:Why is Scope Important?, Scope Management Plan
  27. PROJECT SCOPE MANAGEMENT:Project Scope Definition, Scope Change Control
  28. NETWORK SCHEDULING TECHNIQUES:Historical Evolution of Networks, Dummy Activities
  29. NETWORK SCHEDULING TECHNIQUES:Slack Time Calculation, Network Re-planning
  30. NETWORK SCHEDULING TECHNIQUES:Total PERT/CPM Planning, PERT/CPM Problem Areas
  31. PRICING AND ESTIMATION:GLOBAL PRICING STRATEGIES, TYPES OF ESTIMATES
  32. PRICING AND ESTIMATION (CONTD.):LABOR DISTRIBUTIONS, OVERHEAD RATES
  33. PRICING AND ESTIMATION (CONTD.):MATERIALS/SUPPORT COSTS, PRICING OUT THE WORK
  34. QUALITY IN PROJECT MANAGEMENT:Value-Based Perspective, Customer-Driven Quality
  35. QUALITY IN PROJECT MANAGEMENT (CONTD.):Total Quality Management
  36. PRINCIPLES OF TOTAL QUALITY:EMPOWERMENT, COST OF QUALITY
  37. CUSTOMER FOCUSED PROJECT MANAGEMENT:Threshold Attributes
  38. QUALITY IMPROVEMENT TOOLS:Data Tables, Identify the problem, Random method
  39. PROJECT EFFECTIVENESS THROUGH ENHANCED PRODUCTIVITY:Messages of Productivity, Productivity Improvement
  40. COST MANAGEMENT AND CONTROL IN PROJECTS:Project benefits, Understanding Control
  41. COST MANAGEMENT AND CONTROL IN PROJECTS:Variance, Depreciation
  42. PROJECT MANAGEMENT THROUGH LEADERSHIP:The Tasks of Leadership, The Job of a Leader
  43. COMMUNICATION IN THE PROJECT MANAGEMENT:Cost of Correspondence, CHANNEL
  44. PROJECT RISK MANAGEMENT:Components of Risk, Categories of Risk, Risk Planning
  45. PROJECT PROCUREMENT, CONTRACT MANAGEMENT, AND ETHICS IN PROJECT MANAGEMENT:Procurement Cycles