10 (A) - Lecture 11-12-Resource Scheduling, Resource Constrained CPM, Time Cost Tradeoff

Lecture 4: Defining the Project-I
Project Management
THE MANAGERIAL PROCESS
Clifford F. Gray
Eric W. Larson
Third Edition
Chapter 4
Defining the Project
Defining the Project

Step 1:
Project Information Collection
Step 2:
Defining the Project Scope Statement
Step 3:
Establishing Project Priorities
Step 4:
Establishing Project Success Criteria
Step 5:
Creating the Work Breakdown Structure
Step 6:
Integrating the WBS with the Organization
Step 7:
Coding the WBS for the Information System
EM-504: Project Management Framework And Tools
Prepared by: Farhan Saleem
Farhan Saleem

Step 1: Project Information Collection
1. Project Brief
2. Financial Data
3. Miscellaneous Data
Farhan Saleem

Sample Template
SAMPLE TEMPLATE
PROJECT BRIEF
Project Name: ________________________________________________________________
Project Code: ______________________
Project Priority: _________________________
Location: ____________________________________________________________________
Client: _____________________________
Consultant:_____________________________
Sub-Consultants: ________________________, ____________________________________

Project Manager: ______________________________________________________________
Start Date: _________________________
Finish Date: ___________________________
Farhan Saleem

Sample Template
SAMPLE TEMPLATE
FINANCIAL DATA
Contract Date: ________________________________________________________________
Type of Contract: ______________________________________________________________
Contract Period: ______________________________________________________________
Cost of Project: _______________________________________________________________
Fund Source: ________________________________________________________________
Invoice Date: _______________________
Collection Period: _______________________
Who is responsible to prepare, sign and clear bills (invoices)?

__________________________________________________________________________
MISCELLANEOUS DATA
__________________________________________________________________________
__________________________________________________________________________
Farhan Saleem

1. Project Brief
Project Name: As mentioned in Contract
Project Code:
Project
Number
Value of
the project
04-0151/ INF-IV/ V-3/ SD

Year of
Award
Type of
Project
Completion
Period
Farhan Saleem

1. Project Brief
Project Priority:
Project strategic significance
Lowest to Highest
1 to 5
Project value
1 Million to > 1000 Million
1 to 4
Project profit margin
<5% of value to > 20% of value
1 to 5
Project completion time
>10 years to < 1 Year
1 to 4
Farhan Saleem

1. Project Brief
Location:
Specify Province, City and Area
Client:
Specify name of the owner of the project.
Consultants:
Specify Name of consultants

Specify Sub Consultant (if any)
Project Manager: Specify Name of Assigned Project Manager

Start Date:
Planned Start Date of Project
Finish Date:
Imposed Finish date (if any)
Farhan Saleem

2. Financial Data
Contract Date
The contract initiation date
Type of Contract
Specify type of contract. E.g
1. Lump Sum Contract

2. Unit Priced Contract
3. Turnkey Contract
4. Construction Management
5. Build, Operate and Transfer
Farhan Saleem

2. Financial Data
Contract Period:
The total contract period

[ number of approved calendar days]
Cost of Project:
The contract value of the project
Fund Source:
The source of fund for the projects or

from where you get the invoice
Invoice Date:
Periodic Progress Payment Date

(Usually the invoice is generated at the
end of first week of each month or as
specified in contract)
Farhan Saleem

2. Financial Data
Collection Period: Receivable period after submission of invoice
Who is responsible to prepare, sign and clear bills (invoice)?
Specify the designated authority (Usually quantity surveyor or
contracts manager takes this responsibility)
Farhan Saleem

3. Miscellaneous Data
Any other data pertaining to the project that may be significant
in identifying the project challenges/ complexities and other
planning considerations
Farhan Saleem

Step 2: Defining the Project Scope
Project Scope
A definition of the end result or mission of the
projecta product or service for the client/customer
in specific, tangible, and measurable terms.
Purpose of the Scope Statement

To clearly define the deliverable(s) for the end user.
To focus the project on successful completion of its
goals.
To be used by the project owner and participants as a
planning tool and for measuring project success.
Farhan Saleem
Step 2: Defining the Project Scope

Scope Statement Development Issues
Scope definition should be as brief as possible but
complete.
Close liaison with client is needed to develop a
complete scope statement.
As the project progresses, the scope statement may
need to be revised or refined to reflect approved
changes to the scope of the project.
Completion of the scope statement ends with a review
from the client. The main concern is understanding
and agreement of needs and expectations. Clear
communication in scope issues is imperative to avoid
claims or misunderstandings.
Farhan Saleem

Project Scope Checklist
1. Project Brief
2. Project Justification
3. Scope Inclusions
4. Constraints
5. Scope Exclusions
6. Miscellaneous
7. Project Approval
Farhan Saleem
Project Scope Statement

Sample Template
SAMPLE TEMPLATE
PROJECT BRIEF
Project Name: _________________________________________________
Project Code: ________________
Project Manager: ______________
Client: ______________________
Consultant: ___________________
Start Date: ___________________
Finish Date: __________________
Cost of Project: _______________
Contract Period:______________
PROJECT JUSTIFICATION
Farhan Saleem

Sample Template
SCOPE INCLUSIONS
Objectives
Deliverables
Milestones
CONSTRAINTS
SCOPE EXCLUSIONS
MISCELLANEOUS
PROJECT APPROVAL
Prepared By: _______________________
Approved By: _______________________
Date: ______________
Date: ______________
Farhan Saleem

1. Project Brief
As discussed earlier, Project Brief consist of
Project Name
Project Manager
Project Code
Consultant
Client
Finish Date
Start Date
Contract Period
Cost of Project
Farhan Saleem

2. Project Justification
The need the project was undertaken to address.
Project justification provides the basis for evaluating
future trade-offs.
Farhan Saleem

3. Scope Inclusions
Objectives
Deliverables
The quantifiable criteria that must

be met for the project to be
considered successful.
Identify the major deliverables of

the project with their BOQ costs .
Project objectives must include

cost, time and quality measures.
Milestones
Project objectives should have an

attribute (e.g. cost) and an
absolute or relative value
Identify the Planned/ Imposed

targets for the major deliverables .
Un-quantified objectives (e.g.

customer satisfaction) entail high
risk to successful accomplishment
Farhan Saleem
10

4. Constraints
Constraints are any hurdles in starting, progressing, or
finishing the project.
Examples may be
Land procurement ,
Human resource availability,
Material procurement issues,
Site accessibility and utility procurement,
Cash flow,
Specialty equipment requirement,
etc
Farhan Saleem

5. Scope Exclusions
When known, scope exclusions should be identified.
Failure to do so can lead to false expectations and to expending

resources and time on the wrong problem.
Examples may be excavation work to be done but no backfill

included; material that will be provided by client, not the contractor;
a house that will be built but no security devices installed.
Farhan Saleem
11

6. Miscellaneous
Any other data pertaining to the scope of the project that may be
significant in identifying the project challenges/complexities and
other planning considerations.
Farhan Saleem

7. Project Approval
Add any signatures that are important for the approval of the
project
Farhan Saleem
12
CASE STUDY
A 100 unit housing colony construction project in a city
average location. Value of contracted works is 160 million
and the project is contracted to complete in 36 months using
fast track approach (design, procurement and construction).
Four construction categories: Category A Double storey
one unit houses with high class finish; Category B Double
storey one unit houses with normal finish; Category C
Double storey two unit houses; Category D Single storey
houses.
Scope Statement of Case Study

PROJECT JUSTIFICATION
To provide housing facility to lower and upper middle class
families in an approachable and developed city average location
PROJECT OBJECTIVES
To develop the residential colony within 36 months at cost not to
exceed 160 Million. The quality objectives for the four categories
are:
Category A: High-Class
Category B: Medium
Category C: Medium
Category D: Medium
Farhan Saleem
13

PROJECT DELIVERABLES
25 units in category A:
- 2160 sq-ft, double storey, one-unit, 2 bath, 3 bedroom, 1 drawing,
1 dining, 1 lounge, exclusively finished home
- A finished garage
25 units in category B:
- 2160 sq-ft, double storey, one-unit, 2 bath, 3 bedroom, 1 drawing,
1 dining, 1 lounge, normal finish home
- A finished garage
25 units in category C:
- 2160 sq-ft, double storey, separate unit, 21/2 bath, 3 bedroom,
1 drawing, 1 dining, 1 lounge, normal finish home
25 units in category D:
- 1080 sq-ft, single storey, 11/2 bath, 2 bedroom, 1 drawing and dining,
1 lounge, normal finish home
Farhan Saleem

PROJECT MILESTONES
Permits approved May 1, 2009
Category A completed April 30, 2010
Category B completed February 28, 2011
Category C completed October 31, 2011
Category D completed March 31, 2012
Final Inspection April 30, 2012
LIMITS AND EXCLUSIONS
The houses will be built to the specifications and design of the
original blueprints provided by the client.
Client responsible for land procurement.
Air conditioning is not included but pre-wiring is included.
Contractor reserves the right to contract out services to
approved sub-contractors.
Contractor responsible for sub-contracted work.
Site work limited to Monday through Saturday, 08:00 am to 05:00 pm.
Farhan Saleem
14

Project Scope: Terms and Definitions
Scope Statements
Also called statements of work (SOW)
Project Charter
Can contain an expanded version of scope statement
A document authorizing the project manager to initiate
and lead the project.
Project Creep
The tendency for the project scope to expand over
time due to changing requirements, specifications,
and priorities.
Farhan Saleem
Step 3: Establishing Project Priorities

Causes of Project Trade-offs
Shifts in the relative importance of criterions related to
cost, time, and performance parameters
BudgetCost
ScheduleTime
PerformanceQuality
Managing the Priorities of Project Trade-offs

Constrain: a parameter is a fixed requirement.
Enhance: optimizing a parameter over others.
Accept: reducing (or not meeting) a parameter
requirement.
Farhan Saleem
15

Project Management Trade-offs
FIGURE 4.1
Farhan Saleem
Project Priority Matrix
FIGURE 4.2
Farhan Saleem
16

Development Issues
The Manager needs to have a candid discussion with the
client to establish the relative importance of each criterion.
Constrain on all three criterion (time, cost and quality)
would put the construction manager in a highly inflexible
position.
There are likely to be natural limits to the extent managers
can constrain, enhance or reduce any one criterion.
Manager should document these limits as part of creating
the priority matrix.
During the course of a project, priorities may change. The
manager needs to be vigilant to anticipate/ accept the
change and make appropriate adjustments.
Farhan Saleem

Use
During the planning process, the Project Priority Matrix
is essential to make planning decisions as to the
selection of the right method and sequence of
operations.
During the execution stage, it provides a basis for
monitoring and evaluating project progress so that
appropriate corrective actions can be taken.
Farhan Saleem
17

Establishing Project Priority Index
Priority Parameter
Assessment
Value
1. Project strategic significance
Lowest
Low
Average
2. Project value
High
Highest
Between 1 and 10 million
>1000 million
Farhan Saleem

Priority Parameter
Assessment
Value
3. Project profit margin
<5% of value
4. Project completion time
Between 5% and 10%
Between 10% and 15%
Between 15% and 20%
>20%
>10 years
3 years to 10 years
1 year to 3 years
<1 year
Farhan Saleem
18

Consider a project with following priority parameter values:
Project strategic significance:
Project value:
Project profit anticipation:
Project completion time:
3
2
3
4
Total value:
3+2+3+4 = 12
Project priority index:
priority value/ Max. project priority

= 12/18 = 0.66
Project Priority value (Range = 0 to 1000)

= 0.66 x 1000 = 660
Farhan Saleem
Step 4: Establishing Project Success Criteria

1. What is project success criteria?
2. Significance of Success Criteria
3. Defining Project Success
4. Development Issues
5. Guiding questions for developing success criteria
6. Project Critical Success Dimensions
7. Principal Success Categories
8. Success category Vs Measurable success criteria
9. Sample Template
10.Examples
11.Evaluating success
Farhan Saleem
19

What is Project Success Criteria?
Project Success Criteria is the measurable
project, management, team and business value
that will result from doing this project
It is a statement of value to be achieved, and
therefore, it provides a basis for project
management to request/ demand resources
(including cash) and senior management to
authorize the resources
Farhan Saleem
Significance of Success Criteria

Project success criteria answers the question.
"Why do we want to undertake this project?"
The best success criteria is to state clearly
bottom-line impact of the project.
This is expressed generally in terms of:
1. Increased profit margins
2. Higher net revenues
3. Increased market value
4. Improved productivity
5. Improved resource skill set
6. Reduced cost of operations
Farhan Saleem
20

Defining Project Success
Was your last project a success?
The answer may very well depend upon who is
asked, and their particular definition of success.
As a project manager, you may expect that if you
complete a project on time, within budget, and your
end-result works, that you will have achieved
success.
This seems logical, but it not always true.
Farhan Saleem

Consider this example.....
A project is completed on time, the end-result
works, and the budget was met, but the project
team had to work extra hours and every weekend
for two months because the project schedule was
overly aggressive and the project plan did not
properly account for problems.
Was this project a success....?

Farhan Saleem
21

The answer is likely something along the lines of "it
depends", "yes, but...." or "not in every respect".
Project success cannot be viewed from a single
perspective. Your end-users may not even know or
care that your project was not planned well as long as
the end-result works. But to your burnt-out project team,
that same project could hardly be called a success. If
the project team is burnt-out, the next project manager
who must rely on that same team for future successes
may have real cause for concern. Your ability to
consider a project a "success" will go well beyond
immediate budgets and deliverables.
Farhan Saleem

projects can be successful on many levels, and that
a failure on any particular level is not necessarily
determinative of overall success, or failure.
The true definition of project success arises from multiple
perspectives, and will vary from project to project.
Farhan Saleem
22

Any examination of success should not begin at the end of
a project, but at the very start. Success begins with
consensus amongst all project participants and
stakeholders.
Farhan Saleem

..... what will it take to make this project a success?
The answer to this question will form your success
criteria.
You need to know what you are working towards,
and you also need to know that everyone is on the
same page "success-wise".
Farhan Saleem
23

Development Issues
Success criteria should be created independently for
each project, and should be tailored to suit individual
project circumstances.
Success criteria should be simple & attainable. And,

once defined, they should also be ranked according to
priority.
Farhan Saleem
Guiding Questions for Developing Success

Criteria
1.
What are our indicators for successful completion of

project?
2.
How will we know when we have developed a

successful project deliverable?
3.
What are the various components of our task/process?
4.
What will our intermediate deliverables look like along

the way from initiation to successful completion?
5.
Do we have interim benchmarks?
Farhan Saleem
24

Project Critical Success Dimensions
Deliverables Success - relating to the end-result of the
project (products or services), including issues of quality and
fulfillment of requirements
Procedural Success - relating to the way the project was

organized, structured and managed, including timeliness, cost
control, effectiveness of the project plan, and adherence to
established project management standards
Staff Success - relating to the "human resource" elements of

the project, including resource utilization, staff perspectives,
interactions and team relationships
Business Success - relating to the business/ commercial

elements of the project, including repeat business, increased
revenue, increased market share, new market opportunities, and
technological development
Farhan Saleem
Principal Success Categories

1. Internal Project Objectives (efficiency during the project)
2. Benefit to Customer (effectiveness in the short term)
3. Direct Contribution (in the medium term)
4. Future Opportunity (in the long term)
Farhan Saleem
25

1. Internal Project Objectives - efficiency during project
How successful was the project team in meeting its schedule
objectives?
How successful was the project team in meeting its budget
objectives?
How successful was the project team in managing any other
resource constraints?
Farhan Saleem

2. Benefit to Customer (effectiveness in the short term)
Did the product meet its specified requirements of functional
performance and technical standards?
What was the projects impact on the customer, and what did the
customer gain?
Does the customer actually use the product, and are they satisfied
with it?
Does the projects product fulfill the customers needs, and/or
solve the problem?
Farhan Saleem
26

3. Direct Contribution (in the medium term)
Has the new or modified product become an immediate business
and/or commercial success, has it enhanced immediate revenue
and profits?
Has it created a larger market share?
Farhan Saleem

4. Future Opportunity (in the long term)
Has the project created new opportunities for the future, has it
contributed to positioning the organization consistent with its vision,
goals?
Has it created a new market or new product potential, or assisted in
developing a new technology?
Has it contributed additional capabilities or competencies to the
organization?
Farhan Saleem
27

Success Category Vs.
Measurable Success Criteria
SUCCESS CATEGORY
Internal Project Objectives

(Pre-completion)
Benefit to Customer
(Short term)
MEASURABLE SUCCESS CRITERIA

Meeting schedule
Within budget
Other resource constraints met
Project Management Control observed
Meeting functional performance

Meeting technical specifications & standards
Favorable impact on customer customer's gain
Fulfilling customer's needs
Solving a customer's problem
Customer is using product
Customer expresses satisfaction
Farhan Saleem
Success Category Vs.

SUCCESS CATEGORY
Direct Contribution
(Medium term)
Future Opportunity
(Long term)
MEASURABLE SUCCESS CRITERIA
Immediate business and/or commercial success

Immediate revenue and profits enhanced
Larger market share generated
Resource Optimization realized
Will create new opportunities for future

Will position customer competitively
Will create new market
Will assist in developing new technology
Has, or will, add capabilities and
competencies
Farhan Saleem
28

Sample Template
Project Success Criteria Checklist
S. No.
Success Factor
Category
SAMPLE TEMPLATE
Deliverables Success
Procedural Success
Staff Success
Business Success
Farhan Saleem
Examples
S. No.
Success Factor
Category
SAMPLE TEMPLATE
Deliverables Success
1.
The finishing quality of the

project should provide
compliance with international
standards.
Benefit to Client Fulfilling clients needs

Favorable impact on
client, clients gain
Client expresses
satisfaction
Procedural Success
1.
The project is to be
completed with no more than
10% schedule overruns.
Internal Project
Objectives
(PreCompletion)
Meeting schedule
Farhan Saleem
29

Examples
S. No.
Success Factor
Category
SAMPLE TEMPLATE
Staff Success
1.
Staff resources will acquire

new skills as a result of the
project.
Future
Opportunity
(Long Term)
Has or will add

capabilities and
competencies
2.
Project overtime shall not

exceed estimations by more
than 5%.
Internal Project
Objectives
(PreCompletion)
Within budget
Farhan Saleem
Examples
S. No.
Success Factor
Category
SAMPLE TEMPLATE
Business Success
1.
Project should increase

technological capability of
company.
Future
Opportunity
(Long Term)
Will assist in developing/

utilizing new technology
2.
Project completion should

ensure repeat business from
client.
Future
Opportunity
(Long Term)
Will create new

opportunities for future
Will create new market
Farhan Saleem
30

Evaluating Success
At the end of a project, success criteria can be used as
basis for evaluating project performance.
Looking at success from multiple perspectives would help
identify important indicators for future performance
improvements.
Farhan Saleem
Evaluating Success
Answering following questions will evaluate success of the project
Were success criteria met?
If the answer is yes, how was that accomplished, and how
can we ensure that our successes are repeated?
If the answer is no, why did we fail to meet our success
criteria?
Which criteria did we fail to meet?
Why did each failure occur?
Were the success criteria realistic and attainable?
What improvements can be made in the future to the way we
plan deliverables, execute projects or utilize project staff
resources?
Farhan Saleem
31

Conclusion
Success is the obvious goal of every project .... but it should
not be an unspoken goal, nor should it be taken for granted.
If you take the time to consider success from multiple
perspectives, you will make future project successes more
likely and easier to attain.
Farhan Saleem
32

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Lecture 4: Defining the Project-I

Defining the Project

Defining the Project

Project Information Collection

Defining the Project Scope Statement

Establishing Project Priorities

Establishing Project Success Criteria

Creating the Work Breakdown Structure

Integrating the WBS with the Organization

Coding the WBS for the Information System

EM-504: Project Management Framework And Tools

Prepared by: Farhan Saleem

Lecture 4: Defining the Project-I

EM-504: Project Management Framework And Tools

Step 1: Project Information Collection

Project Priority: _________________________

Sub-Consultants: ________________________, ____________________________________

Finish Date: ___________________________

EM-504: Project Management Framework And Tools

Prepared by: Farhan Saleem

Lecture 4: Defining the Project-I

Collection Period: _______________________

Who is responsible to prepare, sign and clear bills (invoices)?

EM-504: Project Management Framework And Tools

Step 1: Project Information Collection

04-0151/ INF-IV/ V-3/ SD

EM-504: Project Management Framework And Tools

Prepared by: Farhan Saleem

Lecture 4: Defining the Project-I

1 Million to > 1000 Million

Project profit margin

<5% of value to > 20% of value

Project completion time

>10 years to < 1 Year

EM-504: Project Management Framework And Tools

Step 1: Project Information Collection

Specify Province, City and Area

Specify name of the owner of the project.

Specify Name of consultants

Project Manager: Specify Name of Assigned Project Manager

Planned Start Date of Project

Imposed Finish date (if any)

EM-504: Project Management Framework And Tools

Prepared by: Farhan Saleem

Lecture 4: Defining the Project-I

The contract initiation date

Specify type of contract. E.g

1. Lump Sum Contract

EM-504: Project Management Framework And Tools

Step 1: Project Information Collection

The total contract period

The contract value of the project

The source of fund for the projects or

Periodic Progress Payment Date

EM-504: Project Management Framework And Tools

Prepared by: Farhan Saleem

Lecture 4: Defining the Project-I

EM-504: Project Management Framework And Tools

Step 1: Project Information Collection

EM-504: Project Management Framework And Tools

Prepared by: Farhan Saleem

Lecture 4: Defining the Project-I

Purpose of the Scope Statement

Sub-Consultants: , ____________