BSS010 3: Project Management

Week 4

Project product description, Product based planning and Business Case

Lecture aims
Project Product Descriptions Product Based Planning

Business Case

 Activity description
Overview

Reminder: Assignment 1: Project Brief

Business Case
Options considered Reasons for selection of final option Primary and secondary objectives Stakeholder analysis

Completion date + milestones

Estimated total costs Risks

Roles and responsibilities

Directing a Project
Project Mandate Project Brief Starting Up

PID
Initiating a Project

Highlight Report

End Stage Report Managing Stage Boundaries

End of Project Report

Controlling a Stage Managing Product Delivery

Closing a Project

Initiation Stage Plan

Project Plan

Team Plan

Stage Plans Exception Plan

Planning

PRINCE 2

Prince 2 & Product Description

Project Mandate Pre-Project Starting Up Stage

Project Brief
contains

Project Product Description

contains

Outline Business Case

Stage Plan Work Package Product Description

Stage Plan (Initiation)

Benefits Review Plan

Scope (Product) Planning

Definition:

the process of developing a written scope statement as the basis for future project decisions, in particular, the criteria used to determine if the project or phase has been completed successfully
Scope planning: - Defines the boundary of the project and confirms common understanding of the project scope amongst the stakeholders. - Forms the basis of agreement between client and contractor by identifying both the project objectives and major deliverables.

Scope (Product) Planning

Scope planning develops a written statement that is a summary of all the projects products. It acts as the basis for future decisions and establishes a criteria for the completion of an activity, completion of a project phase, or the completion of the project itself. As the project progresses, the scope statement may need to be revised to reflect changes to the scope of the project.

Product Principles
The purpose of a project is to fulfil stakeholder expectations in accordance with the business justification require understanding of:
the products required the quality expectations for them.

The set of agreed products defines the scope of a project and provides the basis for planning and control.

Product Principles - Contd

Product Description provides clarity by defining each products Purpose, composition, derivation, format, quality criteria and quality method. They provide the means to determine effort estimates, resource requirements, dependencies and activity schedules. Without a product focus, projects are exposed to several major risks such as acceptance disputes, rework, uncontrolled change (scope creep), user dissatisfaction and underestimation of acceptance activities.

Product Description
Purpose
Understand the detailed nature, purpose and function of the product

Identify the sources of information or supply for the product

Describe the required appearance of the product Identify the level of quality required of the product Identify product development activities to be developed Identify quality control activities to be developed Define the people or skills required to develop and check the product.

Product Description pt. 2

Composition
Identifier: unique key, probably allocated by the configuration management method Title: name by which the product is known Purpose: this defines the purpose that the product will fulfil. Composition: this is a list of the parts of the product.

Product Description pt. 3

Derivation: what are the source products from which this product is derived?
Format and presentation Allocated to: the person, group or skill type needed to create this product

Quality criteria: to what quality specification must the product be produced Quality method: what kind of quality checking for example, test, inspection or review
Quality tolerance

Activity 1 Group exercise

In your groups, write a Project Product Description for your project

Duration: 10 minutes + 5 minutes feedback time

Example: Annual Conference

Product Based Planning

The purpose of Product Based planning is to subdivide the products into manageable work packages that can be estimated, planned and assigned to a responsible person or department.

The PBS is an excellent tool for quantifying the scope of work as a list of work packages and an essential tool for ensuring the estimate or quotation includes the complete scope of work.

Product Breakdown Structures

The PBS is a hierarchical structure which best represented by a graphical subdivision of the scope of work.
House

Plumbing

Electrical

Piping

Sewerage

Wiring

Appliances

House Project PBS Subdivided into Boxes

PBS Principles
Mutually Exclusive
Each branch describes a distinct project output or deliverable Each subordinate element belongs to only one superior element

Collectively Exhaustive
Together all branches represent the entire project scope

Product Breakdown Structures

Designing

the PBS requires a delicate balance to address different needs of various disciplines and project location
Aeroplane

Wings

Fuselage

Engines

Landing Gear

Cabin Furnishing

Control Systems

Product Breakdown Structure

Product Breakdown Structures

How many levels? Each level of the PBS the scope of work is subdivided into more work packages with corresponding increase in the level of detail. The number of levels is influenced by: - Level of detail; - Level of risk; - Level of control; - Estimated accuracy; - Work package value; - Work package person hours.

Product Breakdown Structures

More than three or four levels are required this can be addressed by using sub-projects, where the lowest level work package of on project constitutes the highest level of another project.
PBS can effectively increase the number of breakdown levels, with each project manager focusing on their own scope of work.

Product Breakdown Structures

Project Control: The appropriate level of control relates to the complexity and risks embedded in the project. Project control is the ability to steer the project to a successful completion. The earned value technique may suggest an appropriate $ value, duration, or work hours for the work package. Risk and Uncertainty: The PBS structure reflects the level of risk and uncertainty in the project. Where the level of risk is high the WBS can be subdivided to generate more information and thus reduce risk.

Product Breakdown Structures

The Numbering System
One

of the beneficial features of the WBS is its ability to uniquely identify by a number or code all the elements of work in a numerical and logical manner.
LEVEL 0 LEVEL 1
Civil 1.1.0 13,000 Plumbing 1.2.0 8000 Electrical 1.2.0 11,000 House 1.0.0 30,000 33000

LEVEL 2
Foundations 1.1.1 5,000 Wall/Roof 1.1.2 8,000 Piping 1.2.1 6,000 Sewerage 1.2.2 3,000 Wiring 1.2.1 3,000 Appliances 1.2.2 8,000

WBS Sub-Division By Numbering System

Good PBS Checklist

1. Achieves a sufficient level of decomposition 2. Provides sufficient detail for communicating all project information 3. Is appropriate for tracking, as required by the specific project or organization 4. Is appropriate for control activities 5. Can contain specific kinds of WBS/PBS elements, as needed for each project 6. Enables assignment of accountability at the appropriate level 7. Has a succinct, clear, and logically organized structure to meet project management and oversight requirement

Reflect on this scenario!

Organize and run a charity for 80 to 100 delegates

Date and Subject Matter are set

Focus is to bring members of a particular profession on recent developments in professional procedures and standards

Project Requirements
Identify a venue Check availability, facilities and price before booking Identify and book suitable speakers

Create detailed agenda and program

Issue press release based on agreed programme Send notice to mailing list for association

Project Requirements
Produce 100 delegate handouts containing
Printed agenda covering agreed programme

Copies of speaker slides and notes

Feedback form for attendees

Update attendance list based on responses from delegates Recruit staff

Activity 2 - Group exercise

In your groups, build the first two levels (main output and major sub headings) of a product breakdown structure Review the headings from another group Do you agree/ disagree with their headings? Suggest an alternative structure
Duration: 10 minutes

CONFERENCE PBS

Conference

1 Venue

2.Attendees

3 Speakers

4 Publicity

5 Delegate Handouts

6 Conference Logistics

7 Previous conference lessons and materials

Activity 3 - Group exercise

Detail at least 3 branches of your reviewed PBS
Duration: 10 minutes

Conference PBS Final

LEVEL 1 LEVEL 2

LEVEL 3

Scenario 2 - Moving Shed to a new Position

Large sized garden Shed with PC and TV setup damaged due to floods

Needs to be inspected for damage and moved

Would require a crane or dismantling as very big

Product Breakdown Structure

Business Case
The Business Case is a description of the reasons for the project and the justification for undertaking the project and the expected business benefits
Drives the decision-making processes and is used continually to align the projects progress to the business objectives/benefits
Business Cases need to be developed according to any organisational standards and the nature of the project.

Business Case Elements

Reasons
This section provides an explanation of the reasons why the project outcome is needed

Options
This section should describe in outline the various options that have been considered to deliver the required outcome. The chosen option should be indicated, together with a summary of the reasons why.

Benefits expected
Define the current status of each benefit in quantifiable terms OR loss that will occur if project is NOT done

Risks
summary of the key risks facing the project that may seriously affect delivery of the outcome.

Cost and timescale Investment appraisal (Cost/ Benefit Analysis) Evaluation

Business Case and Project Phases

Start-up,
Project Mandate is used to develop the information required for the Business Case.

Initiation
Business Case is updated to provide more detailed information on the benefits, risks, options and costs.

Completed Project Plan

Refine the investment appraisal and update risk log

During each Stage

Business Case is reviewed to confirm that the project remains on track and to check that the Business Case remains valid within the business context.

Risks
Risk is a major factor to be considered during the management of any project.

Risk can be defined as uncertainty of outcome (whether positive opportunity or negative threat).

Selected option
High level description of Final Concept Expected Performance Parameters
Risk
Quality

Example Risk Categories

Strategic/ commercial
Underperformance to specification Collapse of contractors Insolvency of promoter

Economic/ financial/ market

Inflation Shortage of working capital

Legal and regulatory

New or changed legislation

Organisational/ management/ human factors

Inadequate corporate policies

Failure to meet Failure to obtain Inadequate adoption projected appropriate approval of management revenue targets practices Market developments will adversely affect plans. Failure to achieve satisfactory contractual arrangements requirements Poor leadership

Failure of suppliers to meet contractual commitments

Key personnel have inadequate authority to fulfil their roles

Quality
Fitness for purpose Satisfying stated customer needs

Examine
Local and International Standards

Customer Requirements

Fit for Purpose?

Activity 4 - Individual exercise

Define at least 3 customer quality expectations for an event taking place on the university premises
Duration: 5 minutes

Lecture recap
At the end of todays session, students should have understood:

Project Product Descriptions

Product Based Planning

Business Case