ABB Basic Quality Tools Series

4Q Basic Project Management

Tools to assist completion of 4Q Project objectives
on time and on cost.

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15 July 2010, Slide 1
 4Q Basic Project Management Tools - Content
What is it for?
4Q Project Management tools allow projects to be managed and
controlled to deliver agreed objectives on time and to cost.
To support execution of multiple tasks to implement and sustain the
4Q solutions

Where could I use them?

At phases throughout a 4Q project
Charter before Q1
Work Breakdown Structure Q3 & Q4
SMART Action lists throughout the project
4Q Process
PERT Plan Q3 & Q4
Q1 - Measure Q2 - Analyze
Gantt Chart Q3 & Q4
Project Control Q3 & Q4 Define opportunity. Identify and confirm root
Risk Management Q3 & Q4 Investigate to understand causes of the problem.
the current state in detail.
How do I use them?
Develop and agree Project Charter Q4 - Sustain Q3 - Improve
Agree & Select PM tools to be used Maintain the improvements Develop, pilot, and
Use each tool appropriately in the 4Q project by standardizing the work implement solutions that
methods or processes. eliminate root causes.
Examples

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15 July 2010, Slide 2
 4Q Basic Project Management Tools
Q1 - Measure
Q4 - Sustain
Charter
Gantt Chart
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4Q Process
Q2 - Analyze
Define opportunity. Investigate Identify and confirm root
to understand the current state causes of the problem.
in detail.
Q3 - Improve
Maintain the improvements by Develop, pilot, and implement
Work Breakdown Structure
standardizing the work solutions that eliminate root
methods or processes. causes.
Reduce Raw
Material Stock-Out
Identify raw materials Calculate the ideal Track the actual Modify the safety stock
Build the
that safety stock is safety stock level for consumption on safety level according to the
safety stock
needed each type of material stock for 1 month actual consumption
Review demand variation Review the suppliers
in last 6 months for each performance in last 6 months
type of material for each type of material
PERT
 4Q Basic Project Management - What is it for?
Uses of these tools:
4Q Basic Project Management ensures that project objectives are defined, agreed and completed
on time and to cost.
Several tools Project Management Tools are available to support this aim:
Charter ensures a 4Q project is clearly scoped and resourced with SMART objectives and
that these are agreed with and supported by the Project Sponsor.
SMART Action lists ensures clearly defined task lists are developed and monitored.
Work Breakdown Structure a tool which helps to divide the project tasks into a manageable
structure
PERT Plan Describes task sequencing
Gantt Chart provides a timeline of tasks to be complete and allows them to be tracked
clearly.
Project Control allows regular review of the plan with associated responses.
Risk Management facilitates consideration of risks to project objectives and responses.
Expected Benefits:
Project objectives are clearly defined and agreed at the start.
Project activities are organised, clear for all to see.
Progress can be tracked and deviations from the plan can be responded to immediately as
appropriate.
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15 July 2010, Slide 4
 Project Charter - Overview
Background:
The use of Project Charters is important for
stating the goal for a 4Q project what is
trying to be addressed, why, how, when and
by whom.
Uses:
Used to state and confirm the problem to be
addressed, the scope and objectives.
Used to seek agreement and approval with the
Project Sponsor prior to start (Q1).
Used to review project

How to use it: Benefits:

Document the Problem description, scope, Helps to clarify the problem being addressed.
project goal and schedule. - use techniques
Ensures agreement and approval of project scope
such as SMART
and objectives with the sponsor.
Document major assumptions, and specific
Ensures expected resources (including team),
requirements.
timelines and costs are clear and understood at
If a budget is assigned, this needs to be the start.
indicated.

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15 July 2010, Slide 5
Project Charter

4Q Project Charter
Problem Description

Project Goal
Major Assumption eg. production volume is 100 pcs/day
(optional)
Requirement eg. data to be retrieved from SAP system
(optional)
Budget
(if any)
Schedule Start date: End date:
Project Team
Role Name Title/Department
Project Sponsor
Project Leader

Team Members

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15 July 2010, Slide 6
 Work Breakdown Structure (WBS) - Overview
Background:
The concept of Work Breakdown Structure
developed with the PERT (see later) in the
US Department of Defense.
In 1968, the DoD issued a military standard
requiring the use of work breakdown
structures across the DoD.
Uses:
Use WBS to help to convert a project into many
specific tasks at different levels.
It helps to organize and define the total work
scope of the project.
For Basic 4Q projects, usually measurement and
analysis is simple and quick to complete. WBS
will be used in Q3 and Q4.

How to use it: Benefits:

Draw as a Tree Diagram with Project Goal at Gives a clear way of representing the work/tasks
the top to be completed
Use items in the action list created in Q3
The WBS should include all of the work
defined by the project scope and captures all
outputs/deliverables.
Detailed tasks needed to get actions done.
Brainstorm and use Post-it Notes to
assemble the WBS to everyone's agreement.

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15 July 2010, Slide 7
Work Breakdown Structure - Example

Reduce Raw
Material Stock-Out

Identify raw materials Calculate the ideal Track the actual Modify the safety stock
Build the
that safety stock is safety stock level for consumption on safety level according to the
safety stock
needed each type of material stock for 1 month actual consumption

Review demand variation Review the suppliers

in last 6 months for each performance in last 6 months
type of material for each type of material

Example: WBS the work reduce raw material stock-out

WBS is a Tree Diagram

WBS helps to convert a project into many specific tasks at
different levels.
All tasks should be SMART.
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15 July 2010, Slide 8
 PERT - Overview
Background:
PERT stands for Program Evaluation &
Review Technique
PERT was developed by consultants at Booz
Allen Hamilton for the U.S. Navy in 1957 to
support the development of missile programs.
PERT chart is a task and event oriented
technique
How to use it:
From the WBS the project team decides
which tasks should be milestones, and also
decides their proper sequence.
Estimate the optimistic, normal and
pessimistic times for each task
A project can be roughly scheduled when not
knowing the precise durations of all tasks.
Draw the PERT Network Diagram
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Uses:
To plan, analyze and coordinate tasks within a
project
Useful for organizing tasks and establishing time
frames, and for showing tasks that depend on
other tasks
PERT is used in projects where time rather than
cost is the major consideration.
Benefits:
Gives a clear way of representing the
dependencies and order of work/tasks to be
completed
PERT is helpful to plan what tasks can go on
simultaneously to reduce time.
Allows identification of the critical path and the
minimum time needed to complete the total
project.
Provides for potentially reduced project duration
due to better understanding of dependencies.
PERT Chart - Example
Program Evaluation Review Technique (PERT) chart
To plan, analyze and coordinate tasks within a project
Useful for organizing tasks and establishing timeframes,
and for showing tasks that depend on other tasks

Example: PERT Chart for Safety Stock management

Task Name Estimated Time Resource
Q3 Identify raw materials that safety stock is needed 3 days Ada
Q3 Review demand variation in last 6 months for each type of material 5 days Mike
Q3 Review supplier performance in last 6 months for each type of material 5 days Ron
Q3 Calculate the ideal safety stock level for each type of material 2 days Ada
Q3 Build the safety stock 10 days Ada
Q3 Track the actual consumption on safety stock for 1 month 30 days Ada
Q4 Modify the safety stock level according to the actual consumption 3 days Ada

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15 July 2010, Slide 10
 Gantt Chart - Overview
Background:
Gantt charts have become a common
technique for representing the activities of a
project , so they can be understood by a wide
audience.
The chart is named after Henry Gantt, who
developed it between1910 and1915.
How to use it:
The project team coverts theWBS or PERT
into a time phased Gantt chart.
Several tools can be used for drawing Gantt
Charts e.g. Microsoft Project, Excel or a
white board.
Project progress is tracked on a regular basis
and modified as needed.
The 4Q Project Gantt chart is owned by the
project leader and should be accessible to all
team members and sponsor
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Uses:
A Gantt Chart helps to visualize and plan project
tasks with start and finish dates, and then helps
to track execution progress.
Gantt Charts are able to show the dependency
relationships between tasks, the critical path, and
the current completion status.
Benefits:
Gives a clear way of representing the
dependencies and order of work/tasks to be
completed
Gantt is helpful to plan what tasks can go on
simultaneously to reduce time.
Allows identification of the critical path and the
minimum time needed to complete the total
project.
Allows both planning and monitoring/control
Gantt Chart - Example
Gantt Chart helps to visualize and plan project tasks with start and finish
dates, and then helps to track execution progress.

Example: Gantt Chart for Safety Stock management

Gantt Chart by Microsoft Project can show the dependency

relationships between tasks, critical path, and current status by
using %-complete.

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15 July 2010, Slide 12
 Project Control - Overview
Background:
Project Control is key to project management.
It supports the project management in
supervising and governing a project and it is
significant for the success of it.
Project Control is linked to the foundation of
Project Management as a discipline.
Uses:
Project Control ensures that regular project
reviews occur to check KPI trends, the schedule
and budget.
Important changes or decisions must be agreed
and documented into the plan

How to use it: Benefits:

Use the Gantt chart to tell if the project is on
schedule and KPIs to see if the project is
progressing in the right direction.
Hold a regular project review (daily or weekly)
via meetings or reports.
Allows project progress monitoring & quick
response to change.
Good communication leads to good projects.
Motivates the team .

Document and act on any changes or

critical decisions such as changes on goals,
solution, team members, or schedule should
be documented in a standard format, and well
informed to relevant people.

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15 July 2010, Slide 13
Project Control - Example

Project time schedule tracking

Project KPI tracking Today

Progress monitor and control is critical

Gantt chart to track the progress by
checking the task completion against Safety
the schedule Stock
Level
Checklist, and measurements tracking
to tell if project is progressing on the Time
right track
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15 July 2010, Slide 14
Project Control - Example
Regular project review to check KPI trends, the schedule and budget.
Important changes or decisions must be agreed and documented into the plan
Good communication leads to good projects.
Acknowledge team members contribution. Continuous motivation.
If change is difficult, find the change agents

The one progressing the fastest

10
8

ahead of schedule
6
4
Days of critical path
2
0
2
4

behind schedule
6
10 8

The one delayed the most

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15 July 2010, Slide 15
 Risk Management - Overview
Background:
A risk is an uncertain event or set of events,
that if they occur, will have an effect on the
achievement of project objectives.
Risk is measured as a combination of the
probability of a perceived threat and the
magnitude of its impact on objectives.
How to use it:
Consider all risks to the project which affect
project targets e.g. cost, quality, benefits
and scope. Brainstorm with team.
Assess each risk in turn for consequence,
impact and probability of occurring.
Identify appropriate mitigation tasks and
include in the project plan.
Anyone can raise a risk.
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Uses:
Risk Management is the application of principles,
approaches and processes to the task of
identifying risks and then implementing risk
responses.
Mitigation tasks are necessary for risk
management.
Mitigation actions need to be included by Q3 or
Q4 in the plan.
Benefits:
It allows the project to save money and time if you
deal with uncertain project events in a proactive
manner.
Minimises the impact of project threats.
Allows the project to be delivered on time, on
budget and with the quality results the project
sponsor expects.
Avoids "fire fighting.
 Risk Management - Example

If any risks are predicted in planning, they need to be addressed

Mitigation tasks are necessary

Risk Consequence Impact/ Cost Probability Mitigation

To describe To describe possible High /Medium High /Medium Mitigation plan 1
the risk consequences /Low /Low Mitigation plan 2

Mitigation tasks must be included in the project plan.

e.g.. Demand fluctuation is a big risk for stock-out. One of mitigation is to update sales
forecast frequently and share the information of upcoming big orders with suppliers timely

Task Name Estimated Time Resource

Q3 Identify raw materials that safety stock is needed 3 days Ada
Q3 Review demand variation in last 6 months for each type of material 5 days Mike
Q3 Review supplier performance in last 6 months for each type of material 5 days Ron
Q3 Calculate the ideal safety stock level for each type of material 2 days Ada
Q3 Build the safety stock 10 days Ada
Q3 Track the actual consumption on safety stock for 1 month 30 days Ada
Add the Q4 Modify the safety stock level according to the actual consumption 3 days Ada
mitigation Q4 Retrieve the latest sales forecast from sales, and highlight large volume orders Every Fri afternoon Mike
to the task Share sales forecast of large volume orders with suppliers and request them to
Q4 Every Mon morning Ada
be prepared
list
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15 July 2010, Slide 17