Chapter 9 ideas - Balancing Cost, Schedule, and Quality

Conclusion

·        Project manager has to balance cost, schedule and quality/feature of the project as the project being implemented.

·        Some balancing can be done by the project team alone.  Some have to be decided by the sponsor or by the executives of the organization.

******

3 levels of balancing a project:

-        Project level

-        Business case level

-        Enterprise level

Project Level

·        Re-estimate the project

·        Change schedule to take advantage of the "float"

·        Add people to the project

·        Increase productivities (internal vs. external experts)

·        Outsource

·        "Crashing the Schedule"

·        Overtime

Not reduce quality, but may reduce features, for example, from 8 to 5…

Business Case Level

·        Reduce product scope

·        Fixed-phase scheduling

·        Fast-tracking (parallel tasks)

·        Phased product delivery (intermediate product?)

·        Do it twice (one quickly that barely works, one later with full feature)

·        Chang profit margin

Enterprise Level

Should we choose this project for another?

Should we change the enterprise-level policy or strategy to improve all projects? For example,

    - use more technology for meeting and communication?

    - have an overall contract for outsourcing?

Chapter 8 ideas- The art and science of accurate estimating

Estimating fundamentals

·         Project team members’ particular skills/knowledge will affect their productivity, and the more complex the tasks are, the more this productivity factor counts.

·         Projects rely on new technology – reliability of the new technology and the learning curve of the team

·         Incorrect timing predictions will cost money.

Classic mistakes to avoid:

·         Making “Ballparks in elevators”

·         Estimating without complete specifications

·         Confusing an estimate with a bid

·         Padding the estimate

Right ways to estimate

-          Have the right people make the estimates (experienced, get the project team involved, but they should not be the only people estimate & understand the goal and techniques of the project)

-          Base the estimate on experience

-          Don’t negotiate the estimate – negotiate the equilibrium

Three levels of accuracy

-          Idea evaluation or “ballpark estimate” (only take a few minutes, no project manager or team yet, can be off by 90%, good to starting planning)

-          Project selection or order of magnitude (consider pass projects, used to decide if formal project should be selected, take a few hours)

-          Detailed estimates or bottom-up estimate (considering all detail and WBS, most accurate)

Estimating techniques

#1: estimating is an extensive field of study and practice.

#2: apportioning (top-down estimating, begins with a total project estimate, then assigns a % of that total to each of the phases and tasks of the project)

#3: Parametric: basic unit of work = a multiplier

#4: bottom-up estimating: requires the most effort, but it is also the most accurate. Detailed tasks are estimated and then combined/rolled up.

Budgeting: 1. Internal (burdened) labor cost; 2. Internal equipment cost; 3. Material; 4. External labor and equipment; 6. Cash flow should be calculated.

It takes time and costs money to develop accurate estimates.

Every technique gives better results when it is used consistently.

The lessons of the past improve the forecasts of the future.

Comparing actual performance to estimates is essential to refining the estimating model. Without this comparison there is no science in the process, only gut feelings.

Many of the techniques work together. The art of estimating is knowing when to use which technique and knowing how much accuracy is required for the business decision at hand.

The variables that make estimates wrong are often beyond the control of the project team. Variables such as changing specifications, failed technology, bad weather, and team turnover can’t be accurately predicted, and yet they result in a variance from the plan.

It is apparent that PMs working independently never create accurate, useful estimation processes. It takes a conscious effort by the firm to establish estimating practices and make sure they are used on every project and updated over time to increase accuracy.

Chapter 7 ideas – Realistic scheduling

A realistic schedule:

·         Includes a detailed knowledge of the work to be done

·         Has task sequences in the correct order

·         Accounts for external constraints beyond the control of the team

·         Can be accomplished on time, given the availability of skilled people and enough equipment

6 steps of Project Planning

1.       Create the project definition

2.       Develop a risk management strategy

3.       Build WBS

4.       Identify task relationships

5.       Estimate work packages

6.       Calculate initial schedule

7.       Assign and level resources

Identify task relationships: any time a series of tasks is performed, there will be sequence constraints – that is, certain tasks that must be performed before others.

There are just two basic rules when graphing task relationships with a network diagram:

1.       Define task relationships only between work packages

2.       Task relationships should reflect only sequence constraints between work packages, not resource constraints.

Milestones are useful markers

Finish to start is most common

Start to start, Finish to finish are also possible.

Estimate work packages

1.       Cost: labor, equipment, materials

2.       Time:

How productivity relates to duration: when estimating the number of people needed for a task, you will need to consider their productivity. Adding people to simple tasks always reduces the duration. However, in the case of tasks involving knowledge workers, adding more workers does not always result in greater productivity and a shorter duration of a task.

Calculate an initial schedule:

Early start – the earliest date a task can begin, given the tasks preceding it.

Early finish – the earliest date a task can finish, given the tasks preceding it.

Late start – the latest date a task can begin without delaying the finish date of the project.

Late finish – the latest date a task can finish without delaying the finish date of the project.

Step one: Forward pass à Step two: backward pass à Step three: calculate float

Critical path: when the initial schedule has been calculated, the project schedule begins to take shape. One of the key features of the initial schedule is the critical path (is one of the most widely used & misunderstood of all project management terms). Critical path is defined as all of the tasks with zero or negative float.

Assign and level resources: the goal of resource leveling is to optimize the use of people and equipment assigned to the project. It begins with the assumption that, whenever possible, it is most productive to have consistent, continuous use of the fewest resources possible.

Chapter 6 ideas- WBS: Break your project into manageable units of work

The secret of successful project management: break the project into small, meaningful, manageable units of work

The WBS is the tool for breaking down a project into its component parts. The WBS uses outputs from project definition and risk management and identifies the tasks that are the foundation for all subsequent planning. It can be set up in either graphic or outline form. (Graphic – easy to understand; outline – list far more than can be listed using the graphic approach)

Building a WBS helps to:

·         Provide a detailed illustration of project scope

·         Monitor progress

·         Create accurate cost and schedule estimates.

·         Build project teams

Summary tasks vs work packages: Summary tasks not are actually executed; they summarize the subordinate work packages. The work packages (the process of deciding who will perform these tasks and how they will arranged provides the structure for the actual work of the project) are actually executed. Summary tasks should be meaningful to some stakeholder. If there are summary tasks that have no audience, erase them. As long as the work packages remain, the scope of the project is the same.

Steps of building a WBS:

Step 1: begin at the top – all deliverables from the SOW appear on the WBS. (The WBS will be linked to the SOW)

Step 2: name all the tasks required to produce deliverables- participative planning not only creates more accurately detailed work breakdowns, it can also encourage higher levels of commitment to the project. (verb + noun)

Step 3: how to organize the WBS-

Work package size: to ensure that the work packages are the correct size, follow these common rules of thumb

·         The 8/80 rule – 8 labor hours< any task< 80 labor hours (=10 days< any task< 1 day)

·         The reporting period rule – no task should be longer than the distance btwn 2 status points, which means, if we hold weekly status meetings, then no task should be longer than 1 week. [I was unaware of this rule; I may have to make changes on the doc I submitted/shared previously.]

·         The “if it’s useful” rule. Whether to break tasks down further, follow the 3 rules:

1)                   The task is easier to estimate.

2)                   The task is easier to assign.

3)                   The task is easier to track.

While working with small increments will produce an enormous amount of detail, it dramatically increases the accuracy of estimating and tracking a project.

Put PM into the WBS: you can benefit by putting PM activities into the WBS. List them under a summary task called “ Project Management”.

Planning for quality: it is cheaper to design a product correctly than to fix it after it is built. We should make sure we catch problems early in the development life cycle. Project management offers the risk management techniques & a process for setting standards for completion of the product.

Completion criteria: (standards for completion of the product)

Completion criteria answer these 2 critical questions about each work package: 1) what does it mean to be complete with this task? 2) How will we know it was done correctly? Determining completion criteria demands that the PM and team look to the best practices in their industry.

In addition to improving quality, completion criteria improve our understanding of each task, which results in more accurate estimates and higher rates of success.

Examples of completion criteria:

·         Peer reviews/walk-throughs

Peer reviews à better results in the front end of the development life cycle

Peer reviews à more cost-effective work in the construction phase

·         Checklists

·         Systematic testing

The acceptance process: begin with the end in mind - Stephen Covery’s ‘7 habits of effective people’

acceptance process – consider early on the process for delivering the final product.

Breaking down large programs: contract à projectsà subprojectsà work packages

WBS Guidelines vary: name all tasks with strong V and N

·         The deliverable-oriented WBS: use only N

·         Work packages as subprojects or groups of activities

Chapter 5 ideas - Risk management: Minimize the threats to your project

Any uncertainties are risks. Risk management is the primary job of a PM. Its advantage is that fewer problems catch the project team off guard. Risk management influences the project plan and changes assumptions in the project rules. Risk management techniques try to increase the satisfaction of every stakeholder and improve the chances of success.

It cannot be overemphasized that risk planning happens repeatedly throughout the project.

Risk management processes systematically manage uncertainty to increase the likelihood of meeting project objectives. The key word is systematic.

• Known unknowns represent identified potential problems, such as the possibility of a strike when a labor contract expires, or enough rain to stall a construction project during winter in Seattle. We don’t know exactly what will happen, but we do know it has a potential to damage our project and we can prepare for it.

• Unknown unknowns are the problems that arrive unexpectedly.
These are the ones you honestly couldn’t have seen coming. But seasoned project managers do expect them, because they know something unexpected always happen

Types of Risks to Consider / Example

Strategic Risks: a competitor coming on to the market
Compliance Risks: the introduction of new health and safety legislation
Financial Risks: non-payment by a customer or increased interest charges on a business loan
Operational Risks: the breakdown of key equipment
Environmental Risks: like disasters
Employee Risks: supplying necessary number of employees, safety and health issues
Political and Economic Risks: in-stable political status in foreign markets you export goods to.

Risk management happens repeatedly throughout the project.

In definition, planning and control stages.

A risk management plan should be updated regularly, especially when old risks disappear and new risks occur.

Business/Strategic Risk vs. Project Risk

Selecting the right project is business risk. Managing uncertainty to meet the stakeholders’ objectives is project risk.

Risk Management Framework - 5 Steps

• Identify risks. Systematically find all the factors that threaten project objectives.

v  Getting information: interviewing experts, brain storming, survey people who managed similar projects

v  "Remember anything can go wrong will go wrong"

v  Create a risk profile for the project (from past experience)

Ø   A risk profile is a list of questions that address traditional areas of uncertainty on projects (see Table 5.1). These questions have been gathered and refined from previous, similar projects.

v  History is the best predictor of the future

• Analyze and prioritize. Assess each risk in terms of its possible damage and likelihood of occurrence. Most projects have an enormous number of potential risks.

Risk Analysis

1. Define the risk, including the severity of the negative impact.
2. Assign a probability to the risk. How likely is it that this problem will occur?
3. Rank the risks according to probability and impact. This prioritized list focuses the project team on which risks they’ll manage.

- there are always risks you can manage

- use impact vs. probability to select high priority risks to manage

• Develop a response. Create strategies for reducing the possible damage and/or probability the risk will occur.

v  Accept - do nothing

v  Avoid - remove the part of project that cause risks

v  Contingency plan

v  Transfer the risks

v  Mitigate the risks

Record risk management strategies using a risk log

• Establish reserves. Set aside additional funding for the project that will be used in case specific risks occur—the known risks—as well as funding for the unknown risks.

Set up a rainy-day fund:  On a regular basis we set aside money—usually a small amount in case when things go wrong.

1. Identify all the risks in the risk log, where your strategy is to monitor the risk and prepare a contingency plan.
2. For each of these risks, consider the probability the risk will occur, estimate the additional cost of executing the contingency plan. 

3. Sum the expected value of contingency for each of these risks. That usually is a large sum of money. The project manager has to negotiate the management of the organization

• Continuous risk management. Implement the strategies and monitor the effects of these changes on the project.

Risks change as project moves forward. Each project meeting should reserve sometime on risk changes.

v  Monitor known risks with a risk log. Each risk in the risk log can be updated before every project status meeting to reflect the most recent information—even if that means “no change.” 

v  Check for new risks at regular status meetings. This activity won’t have the same level of thoroughness that the first risk identification activities had, but by routinely asking for new risks the project develops a climate of risk awareness. When team members do sense a risk, they’ll know where to report it.

v  Repeat the major risk identification activities at preplanned milestones within the project.

·         Projects, like life, are full of uncertainty.  From one perspective, everything a project manager does involve a type of risk management.

·         Risk management begins and ends with attitude. Skepticism and critical analysis expose lurking dangers.

·         Positive, creative problem solving forms a strategy to remove the hazard

·         Persistent, systematic vigilance reveals new perils, and the cycle begins again.

·         Not all unexpected events are negative, some can be positive. So be mindful of taking advance of the positive one.

Chapter 4 ideas - Write the rules: Five key documents to manage expectations and define success

Project rules are the function. Clarifying the Project rules of the game for a new project is exactly what skilled managers need to do. The need for project rules is part of the challenge of each new project.

3 factors of Project rules:

-          Agreement on the goals of the project among all parties involved

-          Control over the scope of the project.

-          Management support: the first, the project charter, is an announcement that the project exists. The following three, the SOW, the responsibility matrix, and the communication plan, are developed concurrently and constitute the actual written documents containing the project rules.

A project charter announces that a new project has begun. It brings the key players out into the open where everyone can see them. The purpose of the charter is to demonstrate mgmt support for the project and the PM. The charter clearly establishes the PM’s right to make decisions and lead the project. It contains the name and purpose of the project, the PM’s name, and a statement of support from the issuers. [Reflections: the deal lead will send an email indicates the name of the customer, the purpose of the project, the PM’s name and a list of team members.] 2 ways to use the project charter: One is as a formal recognition of authority. The other refers to the project definition doc as a SOW.

The charter is a one- time announcement, which makes it different in two ways. 1^st, it should precede the other docs, 2^nd, it is not meant to manage changes that occur later in the project. If a change occurs that is significant enough to make the charter out of date, a new charter should be issued rather than amending the original.

PMs need expert authority.

The sponsor is the best person to sign the charter, because he or she is the one who will be actively supporting the project.

SOW: it lists the goals, constraints, and success criteria for the project – the rules of the game. (Minimum content)

SOW is for members of the same organization. However Contract might be needed if the team consists of multiple organizations.

SOW –purpose statement (why this project?)

SOW- Scope statement (Project scope is all of the work required to meet project objectives. And what are beyond the scope)

SOW-deliverables: what is the project supposed to produce? A new service? A new design? Will it fix a product defect? Tell a team what it is supposed to produce.

SOW-cost and schedule (write it down: Range of budget; deadlines and intermediate deadlines)

SOW-Objectives should be specific and measurable so to measure for success.

SOW- stakeholders (write the draft SOW before presenting the stakeholders); Chain of Command (a common way to illustrate the chain of command is with an org chart)

The SOW that remains at the end of the project may be very different from the original document. The amount of this difference is not important; what is important is that everyone has been kept up-to-date and has agreed to the changes.

Responsibilities Matrix: who are responsible for what?

1.        List the major activities of the project

2.        List the stakeholder groups

3.        Code the responsibility matrix – RACI

Communication Plan:

·         Example of what can go wrong.

·         It is written strategy for getting the right info to the right people at the right time. (who needs info? What info do they need? When & how will they get it?)

·         Regular update meetings via more than one channel

·         Keep the status report short

Proposal vs SOW:

·         Project proposal is completed before the project start (Project proposal launched the project)

·         Content of the proposal overlap the SOW

·         Project manager may or may not be part of the proposal process.

CALMAT 2012 Orientation Stakeholders Analysis

[Project Name] Stakeholder Analysis

Project Manager

[Team Member 1]

Stakeholder Role Profile These questions will encourage the project team to consider a wide variety of stakeholders.  Use these questions to identify as many stakeholders as possible. After generating the list, you may decide some of the stakeholders are represented by other stakeholders or will have so little involvement in the project that you don’t need to consider them and you may remove them from your list. This list is a starting point Add questions to this list that fit your project environment.  If you miss an important stakeholder on one project, add a question to this list that will cause the next project team to identify that stakeholder.

For each of the questions below answer the question: “Who…?”

	Question	All stakeholders that apply. Use people’s names whenever possible.
1.	Approves funding for this project?	Ginger Chen – CALMAT President
2.	Approves functional requirements?	Joshua Chen – Dir of Recruitment & Admission
3.	Approves technical requirements?	Carlos Villanueva - CTO
4.	Approves design decisions?	Carlos Villanueva - CTO
5.	Approves changes to requirements?	Joshua Chen – Dir of Recruitment & Admission
6.	Approves changes affecting schedule?	Joshua Chen – Dir of Recruitment & Admission
7.	Approves changes affecting cost?	Joshua Chen – Dir of Recruitment & Admission
8.	Will use the product or service produced by the project?	Orientation attendees/New students
9.	Set the organizational goals that drive the necessity of this project?	Team Member 1 – Project Manager
10.	Will assign people to the project team and determine the hours per day they work on the project?	Team Member 1 – Project Manager
11.	Approves contracts for suppliers?	Team Member 1 – Project Manager
12.	Is the manager or executive sponsoring this project (will use their authority on behalf of the project team to overcome organizational obstacles)?	Joshua Chen – Dir of Recruitment & Admission
13.	Will manage the project (provide leadership to assure tasks are assigned and completed on time, cost and schedule are monitored, issues are identified and resolved)?	Team Member 1 – Project Manager
14.	Represents organization policies governing this project?	Ginger Chen – CALMAT President
15.	Represents regulations or laws affecting this project?	Joshua Chen – Dir of Recruitment & Admission
16.	Will have their work disrupted by this project?	Board of Directors (?)
17.	Will have to change their systems or processes because of this project?	Joshua Chen – Dir of Recruitment & Admission
18.	Will benefit from this project? (If this is a large group, who will represent this group?)	Joshua Chen – Dir of Recruitment & Admission
19.	Will perform the work on this project? (This includes all vendors and subcontractors as well as employees)	Existing Students/Faculty/Staff
20.	Will participate in phase gate decisions to approve moving the project to the next phase?	Event participants

Stakeholder Alignment Questions These questions will ask for a minimum amount of understanding about each stakeholder.  Use these for each stakeholder that has a high interest in the project or can have a high impact on the project.  The better you understand each stakeholder, the better prepared you’ll be to win cooperation. Not for publication These questions are meant to stimulate thinking about stakeholders.  Your assumptions and insights into the motivations of each stakeholder or stakeholder group are a private assessment and should not be published.

For each significant stakeholder, answer the following questions:

	Name:	Title:
1.	What is their contribution to the project?	Initiate, agree and execute the event proposal
2.	To whom do they report?	Project Manager
3.	What authority do they have over the project?	Monitor, execute, role change and reward
4.	What is their goal for the project (what is their stake in the project) and how does it relate to their organization’s goal or other personal goals? (What makes this a ‘win’ for them?)	Cost-schedule-quality: deliver quality orientation goals as planned on time and within budget.
5.	Do they present a specific threat or opportunity?	Stakeholders will get opportunity – new students get event deliverables, project team achieves the success of project management, CALMAT gets better popularity and increased awareness.
6.	What perception do you want them to have about the project?	To get a better idea what they are going to accomplish through CALMAT program and get a smooth transition to the program. CALMAT provides solid education via its unique teaching/learning platform.

Plan Communication

Use the Communication Plan and Responsibility Matrix templates to document roles and responsibilities and how you’ll keep your stakeholders engaged and informed.

CALMAT 2012 Orientation

Communication Plan

Project Manager: [Team Member 1]

This communication plan describes our strategy for keeping the project’s stakeholders sufficiently informed to avoid any disappointment regarding cost, schedule, or quality goals.

Stakeholder	Information needs	Frequency	Medium	Response
Sponsor	·  Execution status, approvals & problems	Every 2 weeks	1. Face to face or email	[describe]
Customer	·   Event Announcement email, Invitation email and VIP email confirmation ·   Survey (on site & at the end of the event)	Total 3 times over the length of the project	3 Emails
Management/Team Member 1	·   all aspects related to cost, schedule and quality goals	Problems occur: On a timely basis/otherwise:  weekly	5.  skype/email
Team Member 2	G Group 1: status updates & problems	Problems occur: On a timely basis/otherwise:  weekly	skype/email
Team Member 3	·   (Group 1: Team Member 2 & 3)	Problems occur: On a timely basis/otherwise:  weekly	skype/email
Team Member 4	·   Group 2: status updates & problems	Problems occur: On a timely basis/otherwise:  weekly	skype/email
Team Member 5	·   (Group 2: Team Member 4 & 5)	Problems occur: On a timely basis/otherwise:  weekly	skype/email
Team Member 6	·   Group 3: status updates & problems	Problems occur: On a timely basis/otherwise:  weekly	skype/email

[Project Name] Responsibility Matrix

Project Manager: [Name]

This matrix describes the level of participation and authority for project stakeholders on major project activities.

E    Execution responsibility.  Stakeholder responsible for getting the work done.  Not necessarily a decision maker, but drives the group to make decisions in a timely manner.

A    Approval authority.  Final approval on accepting the outcome of this activity.  Makes decisions.

C    Must be consulted.  As work is performed this stakeholder contributes information.  Does not make decisions, but is asked for input prior to decisions.

I     Informed after a decision is made.  Wants to stay updated on progress of this activity.

Activity	[Sponsor]	[Customer]	[Team Manager 1- PM]	[Team Member 2]	[Team Member 3]	[Team Member 4]	[Team Member 5]	[Team Member 6]
Project Kickoff Team Meeting to cover & reach an agreement on: -       Project team, responsibilities & schedule -       Project Scope -       Est’d budget & set up policy/rules & procedures -       Communication plan	A		E	E	E	E	E	E
Develop event agenda to reach the event outcomes as below: A. Knowing the CALMAT learning model B. Knowing the registration process and individual learning plan C. Knowing where to get resource - food, library, parking, study partners D. Knowing the basic technology - ulearn, gmail, calmat.us E. Register classes F. Walking tour of Starbucks, MLK library, eateries, museums, etc	A		E	E	E	E	E	E
Administrative function (Team Member 2 & 3): -acquire the access to the new students data -acquire the administrator access to registration process -schedule keynote speakers -enforce the policy/rules & procedures -identify event participants			E	E	E	I	I	I
Logistic function (Team Member 4 & 5): -acquire the access to use/modify CALMAT current equipment (PCs, laptops, wireless, audio/video equipment, facility, furniture, etc) -outfit the event venue, add signs for parking -Establish logistics items order process -finalize walk tour route with alternatives			E	I	I	E	E	I
Marketing function: -establish materials production process -modify event materials as needed -contact medias -establish sponsorship with businesses in the neighborhood			E	I	I	I	I	E
Post-event evaluation	E	E	E	E	E	E	E	E