Effective Project Management

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Effective Project Management

• Barbara Stone Jodie Mathies
• October 11, 2007

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Agenda

• Srini elevator speech
• Questions on assignment?
• Q A
• Cost Baseline
• Risk Management

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Questions

• What are the benefits of critical path analysis
  over Gantt charts?
• Disadvantages?
• What is Critical Chain theory?
• What is a buffer?
• Why would critical chain be especially important
  in managing a program vs. a project?
• What is Parkinsons Law?

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Answers

• formally identifies tasks which must be completed
  on time for the whole project to be completed on
  time, and also identifies which tasks can be
  delayed for a while if resource needs to be
  reallocated to catch up on missed tasks
• A further benefit of Critical Path Analysis is
  that it helps you to identify the minimum length
  of time needed to complete a project. Where you
  need to run an accelerated project, it helps you
  to identify which project steps you should
  accelerate to complete the project within the
  available time. This helps you to minimize cost
  while still achieving your objective
• The disadvantage of CPA is that the relation of
  tasks to time is not as immediately obvious as
  with Gantt Charts.
• Underlying the key differentiating aspects of
  Critical Chain-based project management are an
  appreciation for the impact of variation (the
  statistical nature of projects) and of human
  behavior (people's response to how their projects
  are managed) on the ability of a project to move
  with speed and reliability
• Buffers are designed quantities of time, sized
  and applied to a project schedule to protect what
  is important to the success of that project. The
  Project Buffer protects the promised due date
  from variation in the critical chain.
• By combining the ability of buffers to absorb
  variation with the synchronization (staggering)
  of project launches based on the availability of
  key (heavily and commonly used) resources or on
  the capacity of (common) major integration
  points, cross-project contention for resources is
  minimized. Doing so results in less pressure to
  multitask and its lead-time multiply effects.
• "Work expands to fill the time available for its
  completion."

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When do you calculate Project financials?

• Beginning create baseline budget
• During track progress to baseline adjust
  budget as necessary
• End success metric of project

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As you go through the Planning Phase, cost
estimates accuracy increases

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• Class 1 - Variance /- 30 to 50 - High level
  estimate at the Phase level.
• Class 2 - Variance /- 15 to 25 - As many
  details as possible.
• Class 3 - Variance /- 10 - Completely filled
  out as applicable.

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Cost Estimating Tools Techniques

• Analogous we did more or less the same thing
  last year and it took us 6 months and cost 400K
• Parametric new home construction 130/square
  foot Software Function (or Object) Point
  Analysis
• Bottom-up estimating cost of individual tasks,
  then rolling up
• etc

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Cost Budgeting tip

• Dont forget contingency for risk
• Somewhat equivalent to safety in schedule
• Apply to Cost Baseline at milestone points, not
  factor for every task

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How do projects get funded?

• What do I mean by funded?
• Approval to use the resources required.
• Projects can get funded
• for entire project, at beginning
• incrementally, at specified points

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I can hear you saying

How does this relate to my project?
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You have already been working on cost elements
for your project

• Time estimates for team members
• effort vs duration
• Understanding purchases
• Understanding time cost of risk mitigation plans

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Your cost baseline

• (Effort in hours of all tasks cost per
  hour)
• Other budgeted project expenses
• Project cost baseline

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MS ProjectProject Cost baseline development
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Project Risk Management
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Tom Sawyer vs Chicken Little

• If you dont identify opportunities, they wont
  be in your field of view
• If you dont actively attack risks, the risks
  will actively attack you
• Opportunity management objectives are driven by
  the desire to excel while risk management
  objectives are driven by the desire to not fail.

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Five steps

• Plan and define the approach. Create a risk
  management plan. Take a high level approach which
  includes a recurring schedule for reviewing
  risks.
• Identify the risks that might be faced. Risks
  can have both positive and negative
  ramifications. For each risk look at the upside
  and downside by identifying both the threats and
  opportunities.

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5 steps - continued

• Analyze and assess each risk to determine the
  severity of its potential impact on the project
  and the likelihood that it will occur. A simple
  scale of high, medium and low can be used.
  Ranking priority can be achieved by assigning a
  value to the scale. Categories can be added to
  differentiate the type of risk, for example
  technical vs. business. Risk responses can vary.

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5 steps - continued

• Assign actions and owners to each identified
  risk. The results of Steps 2, 3 and 4 lead to the
  creation of the projects risk register that logs
  each risk, the response(s) defined to deal with
  it, and the results when available.
• Continuously review existing risks and add new
  potential risks, updating the risk management
  plan as needed to ensure that the project
  achieves its objectives. This is the most
  critical step and forms the closed loop process.

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Risk identification

• Include as many team members, sponsors, knowledge
  experts as possible
• Concerted effort to visualize new risks
  determine if additional assumptions are being
  made unconsciously
• Review scope, resources, environment, vacations,
  production freezes, travel, etc. in light of risk

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risk sources
Engagement Definition Client Commitment Technology - Hardware Software
Legal Contractual Project Schedule Complexity
Commercial Issues Duration Related Projects
Political Considerations Project Budget/Financial HP divisions and internal entities
Regulatory Issues Communications Sub-contractors
Industrial Relations Resources Suppliers
Occupational Health Safety HP Experience Capability Market Action
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A Better UC-Wise - Meghalim

• UC-Wise has been in existence since 2002 and
  there have been ongoing concerns with its
  usability and steep learning curve. Project goal
  is to provide a set of recommendations for
  building a new and better web-based teaching tool.

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Illumobile Marketing - Bindiya

• A broadcast outdoor advertising company that
  wants to expand its network from 10 to 50 within
  6 months AND
• Develop a plan to turn the advertisement creation
  team into a revenue-generating department

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Online Automobile Trading - Rob

• Develop an online auction site that lowers the
  per-vehicle dealership-to-dealership trading cost
  of used automobiles

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Produce a jazz CD - Katherine

• Produce an outstanding and professional- looking
  jazz CD to promote the band and lead to paying
  gigs

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Reporting Tool - David

• Build reporting tool function to use with
  existing internally-developed Capacity Management
  tool
• Goal is to level resources across organization
  based on historical, current, and funnel
  information

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iNaturalist.org - Jessica

• Create an online, interactive community for
  naturalists, such as bird watchers, fishermen,
  mushroom foragers, etc.

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Personalized registration - Adrian

• Improve customers experience with registration
  experience through customized responses

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Bid site for labs - Jim

• Online site to provide schedule, bid documents,
  etc. extending bidders who bid on Berkeley Lab
  projects

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Srini
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Key evaluation points

• Project Definition
• Detailed planning
• Concept trade-offs
• Development of system documentation
• Manufacturing preparation
• Supplier selection
• Coding preparation
• Test preparation
• Shipping/handling
• Deployment
• Change evaluation

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Options for action

• Avoidance is the most direct response.
  Eliminating the risk or its ability to impact
  your project.
• Mitigation means reducing the probability of
  the risk or minimizing its impact if it does
  occur.
• Contingency simply means having alternative
  plans in place to deal with a threat, should one
  occur or should a mitigation plan fail.
• Transference shifts the risk to another party.
  This often involves a legal or contractual
  relationship.
• Sharing involves two separate parties (i.e.,
  company and customer system developer and
  end-user) taking on the responsibility for
  dealing with the threat and the risk.
• Acceptance could be active or passive.
• Passive acceptance means nothing will be done to
  prepare for the risk in advance. Instead, it will
  be dealt with if and when it occurs.
• Active acceptance usually means developing a
  contingency plan in case the event occurs later.
  This could involve holding money or resources in
  reserve. In either case, the project manager and
  the organization must be able to tolerate the
  consequences of the accepted risk event should it
  occur.

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Another view of options

• Identify potential opportunities and their risks
• Assess associated probabilities of occurrence and
  the impact (benefit or consequence of the
  occurrence)
• Decide to

Do nothing ? Take causative actionfor opportunity preventative action for risk ? Take contingent action based on an identified trigger
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Scope planninghigh-levelskills analysis
Charterbusiness casefeasibility studyproduct
description
Scope statement
Scope definitionassumptionsscope
in/outalternatives
WBS
Risk Mgmtplanning
ActivityDefinition
Costbudgeting
Resourceplanning
Costestimating
Cost baselineTime-phased budget
Risk Mgmtplan
Resourcerequests
Activitydurationestimating
Activitysequencing
CommunicationPlan
Schedule development
Networkdiagram
Project schedule
Project Plandevelopment
Project plan
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Presentation of risk to management
..\..\Desktop\ presentation.ppt
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Triggers for risk review

• Cost variance
• Schedule variance
• Changes in forecast project end date
• Changes in schedule float
• Changes in stakeholder attitude
• Earned value variance

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Risk/Opportunity handling

• Identify risks
• Quantify
• Qualify
• Rank by criticality
• Identify options for managing
• Assign owner
• Establish trigger

• Changes also change risks
• Positive
• Negative
• Review, reprioritize, take action

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Assignments for next class

• Effective Project Management, Chapters 10
• Real World Budget Tracking with MS Project
  (Gantthead)
• Read Who's afraid of EVA? (Gantthead)
• Read Agile Estimating and Planning, chapter 10
• For your project
• Create a risk management plan using this template
  (xls)
• Create a cost baseline for your project