Sikkim Manipal University - MBA - PM0011 - Project Planning and Scheduling

Semester: 3 - Assignment Set: 1

Question 1: Explain in detail the project delay analysis methodology?

Answer:

Delay Analysis:

Delay analysis is a widely debated construction law subject due to the number of projects that
are not completed on time, the financial implications of late completion and the often quite
different conclusions that can result depending upon the method of analysis used. Delay
analysis is the technique used to identify causes of delay and the impact they have on the
progress and completion of a project. It is necessary in some form for claims for extensions of
time and cost of prolongation. Without it a contractor will fail to demonstrate any entitlement.
In practice, several iterations are required to ensure that the model represents what would
have happened but for the delays. This involves adjusting the level of detail, logic and
durations of activities. When undertaken properly, this method of analysis addresses the
complex issues of concurrent delays, acceleration and re-sequencing of activities. It is often
used by expert witnesses when giving opinions in arbitration or litigation

Delay analysis is a forensic investigation into the events or issues that caused a project to run
late resulting in Schedule Variances. Delay analysts refer to `critical' and `non-critical' delays;
the first are events causing delay to the project's completion date and the second type affect
progress on the project but do not directly impact the project completion date.

During the past decade developments in computer technology and the availability of more
advanced planning software packages changed the way in which delay claims and the results of
a delay analysis are presented.

Delay analysis methodology:

There are two types. The first type of delay analysis methodology is prospective; which
demonstrates the theoretical or likely impact of the consequences of delaying events rather
than showing what in fact occurred. The basis of this methodology is to establish a
programming model of the project, usually the contractor's as planned program, then impact
the model by the application of delaying events. This type of methodology is commonly used to
demonstrate what extension of time a contractor is due, as a result of the application of
employer responsible delaying events. This is said to be the contractor's entitlement.
Entitlement in this context is derived from the results of a delay analysis and is not to be
confused with contractual entitlement. In summary the prospective type of methodology is a
theoretical calculation of the likely delay a delaying event(s) would cause to project completion.
In other words, it focuses firstly on the delaying event and then demonstrates the likely delay
to progress and ultimately project completion that is likely to flow from the event.

The second type of delay analysis methodology is retrospective. The retrospective analysis tries
to show what actually occurred on a project; where the delays were; and what caused the
delay to project completion. The analysis shows how actual progress differed from what was
planned. By focusing on how the works actually progressed, the analysis will show when work
activities were delayed, and from the results of the analysis, investigation of what caused the
actual delays can be carried out. In summation, this type of methodology looks at what actually
happened, what activities were actually delayed and only thereafter what caused the delay.
Both types of delay analysis methodology are to some degree subjective. The prospective
analysis relies heavily on a programming model of the project and the delay analyst's opinion
on how the delay event was likely to influence the model. The retrospective analysis is less

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subjective as it relies on actual progress. However, interpretation of the results as to what

caused delay is subjective. This is because the delay analyst will usually have to consider a
number of related issues as to what caused delay and apply his own experience and judgment.
If there were a single method of analysis that yielded only one result from a given set of facts
then there would be little doubt as to the party responsible for the delay. Until such a method
is found, however, delay analysis will continue to be a subject of much debate.

Question 2: Describe all the project management knowledge areas.

Answer:

The basic function of project management is to use skills and knowledge to manage and fully
utilize all the resources in a project. Peter Ducker has said “Plans are only good intentions
unless they immediately degenerate into hard work.” And to accomplish this tough task is the
biggest challenge faced in a project. To face the challenge well, it is necessary to make sure
you spend maximum time in planning.

To make planning easier, PMI has subdivided project management into 42 processes. And
these 42 processes have been bundled into 5 process groups. They are simultaneously
distributed among 9 knowledge areas. These process groups/processes may overlap/repeat
based on the activities on the project.

The 42 processes are also grouped into various knowledge areas. The nine knowledge areas
are:

Project Integration Management:

A subset of project management that includes the processes required to ensure that the
various elements of the project are properly coordinated. It consists of:

 Project plan development—integrating and coordinating all project plans to

create a consistent, coherent document.
 Project plan execution—carrying out the project plan by performing the activities
included therein.
 Integrated change control—coordinating changes across the entire project.

Project Scope Management:

A subset of project management that includes the processes required to ensure that the project
includes all the work required, and only the work required, to complete the project successfully.
It consists of:
 Initiation—authorizing the project or phase.
 Scope planning—developing a written scope statement as the basis for future
project decisions.
 Scope definition—subdividing the major project deliverables into smaller, more
manageable components.
 Scope verification—formalizing acceptance of the project scope.
 Scope change control—controlling changes to project scope.

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Project Time Management:

A subset of project management that includes the processes required to ensure timely
completion of the project. It consists of:
 Activity definition—identifying the specific activities that must be performed to
produce the various project deliverables.
 Activity sequencing—identifying and documenting interactivity dependencies.
 Activity duration estimating—estimating the number of work periods that will be
needed to complete individual activities.
 Schedule development—analyzing activity sequences, activity durations, and
resource requirements to create the project schedule.
 Schedule control—controlling changes to the project schedule.

Project Cost Management:

A subset of project management that includes the processes required to ensure that the project
is completed within the approved budget. It consists of:
 Resource planning—determining what resources (people, equipment, materials)
and what quantities of each should be used to perform project activities.
 Cost estimating—developing an approximation (estimate) of the costs of the
resources needed to complete project activities.
 Cost budgeting—allocating the overall cost estimate to individual work activities.
 Cost control—controlling changes to the project budget.

Project Quality Management:

A subset of project management that includes the processes required to ensure that the project
will satisfy the needs for which it was undertaken. It consists of:
 Quality planning—identifying which quality standards are relevant to the project
and determining how to satisfy them.
 Quality assurance—evaluating overall project performance on a regular basis to
provide confidence that the project will satisfy the relevant quality standards.
 Quality control—monitoring specific project results to determine if they comply
with relevant quality standards and identifying ways to eliminate causes of
unsatisfactory performance.

Project Human Resource Management:

A subset of project management that includes the processes required to make the most
effective use of the people involved with the project. It consists of:
 Organizational planning—identifying, documenting, and assigning project roles,
responsibilities, and reporting relationships.
 Staff acquisition—getting the needed human resources assigned to and working
on the project.
 Team development—developing individual and group skills to enhance project
performance.

Project Communications Management:

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Semester: 3 - Assignment Set: 1

A subset of project management that includes the processes required to ensure timely and
appropriate generation, collection, dissemination, storage, and ultimate disposition of project
information.

Communication takes at least 90% of a Project Manager’s time! It consists of:

 Communications planning—determining the information and communications
needs of the stakeholders: who needs what information, when they will need it, and
how it will be given to them.
 Information distribution—making needed information available to project
stakeholders in a timely manner.
 Performance reporting—collecting and disseminating performance information.
This includes status reporting, progress measurement, and forecasting.
 Administrative closure—generating, gathering, and disseminating information to
formalize phase or project completion.

Project Risk Management:

Risk management is the systematic process of identifying, analyzing, and responding to project
risks. It includes maximizing the probability and consequences of positive events and
minimizing the probability and consequences of adverse events to project objectives. It
includes:
 Risk management planning—deciding how to approach and plan the risk
management activities for a project.
 Risk identification—determining which risks might affect the project and
document their characteristics.
 Qualitative risk analysis—performing a qualitative analysis of risks and conditions
to prioritize their effects on project objectives.
 Quantitative risk analysis—measuring the probability and consequences of risks
and estimating their implications for project objectives.
 Risk response planning—developing procedures and techniques to enhance
opportunities and reduce threats from risks to the project’s objectives.
 Risk monitoring and control—monitoring residual risks, identifying new risks,
executing risk reduction plans, and evaluating their effectiveness throughout the
project life cycle.

Project Procurement Management:

A subset of project management that includes the processes required to acquire goods and
services to attain project scope from outside the performing organization. It consists of:
 Procurement planning—determining what to procure and when.
 Solicitation planning—documenting product requirements and identifying
potential sources.
 Solicitation—obtaining quotations, bids, offers, or proposals, as appropriate.
 Source selection—choosing from among potential sellers.
 Contract administration—managing the relationship with the seller.
 Contract closeout—completion and settlement of the contract, including
resolution of any open items.

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Semester: 3 - Assignment Set: 1

Question 3: State and describe process of estimating resource & duration for the
activity. List the basic elements of a project plan.

Answer:

Activity Resource Estimating Process:

Activity resource estimating is a process in which the project team carefully compiles a
thorough listing of the resources that will be needed in completing a project. There are six
inputs that are to be used in the process of activity resource estimating. Those six inputs are
the activity list, the activity attributes, the organizational process assets, the enterprise
environmental factors, and project management plan, and the resource availability. There are a
number of tools that can also be utilized in most effectively estimating the required activity
resources. Those tools include expert judgment, a complete alternatives analysis, and the use
of published estimating data, project management software, and the use of bottom-up
estimating. The resulting outputs from this process include activity resource requirements;
activity attributes updates, requested changes, a resource breakdown structure, and the
development of a resource calendar. The successful utilization of activity resource estimates
will help assure that enough resources are acquired without waste and excessive expenditure.

Activity Duration Estimating:

Activity resource estimating is a process in which the project team carefully compiles thorough
listing of the resources that will be needed in completing a project. There are six inputs that
are to be used in the process of activity resource estimating. Those six inputs are the activity
list, the activity attributes, the organizational process assets, the enterprise environmental
factors, and project management plan, and the resource availability. There are a number of
tools that can also be utilized in most effectively estimating the required activity resources.
Those tools include expert judgment, a complete alternatives analysis, the use of published
estimating data, project management software, and the use of bottom-up estimating. The
resulting outputs from this process include activity resource requirements; activity attributes
updates, requested changes, a resource breakdown structure, and the development of a
resource calendar. The successful utilization of activity resource estimates will help assure that
enough resources are acquired without waste and excessive expenditure.

Basic elements of a project plan:

Many people (and a distressing number of project managers, too) think only of a Gantt chart
when they think of a project plan. You may recognise it as what you get from Microsoft Project.
This is better called a project schedule, in that it shows when we expect the various sections of
the project to happen.

Whenever any project is planned it is absolutely vital to have a project plan and although
initially it will take a little time to create, a good project plan will ultimately save you a good
deal of time and probably money as well. It is often tempting to just roll up your sleeves and
start bringing the project into being. But time taken to plan and create a project plan will
actually ensure that you don't rush into something and make foolish mistakes because you
didn't plan for something. A good project plan has certain key elements that enable the
manager and team to bring any project to conclusion on time and under budget. A Without
these key elements, the plan is incomplete and will eventually fail after proving itself useless to
completing the project.

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Project planning is not an exact science, and project plans vary greatly depending upon what is
being developed and the project scope. Furthermore, project plan terms like scope statement,
project charter, and statement of work are not rigorously standardized and often have overlap
or differing interpretations. One of the primary considerations should always be to have enough
information, but no more. Demanding paperwork and reports for the simple sake of having
things documented serves no useful purpose and can drive frustrated team members to view
project management as nothing but busywork and bureaucracy.

 What is to be done:
What is desired of the project and what it must deliver to succeed? A high level scope
document and requirements specs. at lower levels;

 When it needs to be done by:

The deadlines by which the objectives must be met, usually in a schedule of some kind;

 Who is to do it:

The people, sometimes unkindly labelled “resources”, who are to deliver those
objectives. This also usually implies costs since the application of costs implies the use
of labour. Documented by a project budget;

 How it is to be achieved:

The method of delivery, covered by documents such as a technical specification, test

plans and the like.

Question 4: Compare Critical Chain Project approach & critical chain approach.

Answer:

Project schedule plan is the main plan included in any Project Management Plan. Project
schedule is responsible for bringing project time, cost and quality under control. Project
schedule links resources, tasks and time line together. Once Project Manager has list of
resources, work breakdown structure (WBS) and effort estimates, he is good to go for planning
project schedule. Schedule network analysis helps Project Manager to prevent undesirable risks
involved in the project. Critical Path Method (CPM) and Critical Chain Project Management
(CCPM) are key elements of schedule network analysis. In the following sections we will explore
these elements in details to understand their importance in keeping project on schedule to get
increase in ROI.

Critical Path Method (CPM) / Critical Chain Approach:

The Critical Path Method (CPM) is a schedule network analysis technique. CPM was developed
by the DuPont Corporation in 1957.Critical path determines the shortest time to complete the
project and it is the longest duration path through a network of tasks. Critical tasks (activities)
are tasks (activities) on the critical path. To understand CPM further let's first understand

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nature of the task. According to PMBOK every scheduled task can be defined by the following
four parameters:

 Early Start (ES): Earliest possible point in time on which a task can start.
 Early Finish (EF): Earliest possible point in time on which a task can finish.
 Late Start (ES): Latest possible point in time on which a task can start.
 Late Finish (EF): Latest possible point in time on which a task can finish.

Early Start and finish dates are calculated by means of Forward Pass and Late Start and Late
Finish dates are calculated by means of Backward Pass.

Many Tasks have some amount of buffer added to them referred as Slack Time or Float. Float
time is amount of time a task can slip before it delays project schedule. There are two common
types of floats:

 Free Float: Amount of time a single task can be delayed without delaying the early
start of any successor task.
 Total Float: Amount of time a single task can be delayed without delaying project
completion. Mathematically Float is defined as: Float = LS - ES or LF - EF. Critical path
has zero or negative Total Float. A project can have several critical paths.

CPM is helpful in:

 Project Planning and control.

 Time-cost trade-offs.
 Cost-benefit analysis.
 Contingency planning.
 Reducing risk

Limitations of CPM:

 CPM assumes low uncertainty in schedule dates.

 Does not consider resource dependencies.
 Less efficient use of buffer time.
 Less focus on non-critical tasks that can cause risk.
 Based on only deterministic task duration.
 Critical Path can change during execution.

To overcome above limitations Critical Chain Project Management (CCPM) plays important role.

Critical Chain Project Management (CCPM):

According to PMBOK Critical chain method is a schedule network analysis technique that
modifies the project schedule to account for limited resources. It mixes deterministic and
probabilistic approaches to schedule network analysis. The critical chain concept was coined by
Eliyahu Goldratt. Following few sections briefly describe the concepts Critical Chain depends on
and are useful to understand the example that will follow shortly after that.

CCPM takes advantage of the best practices of:

 PMBOK: Planning and control processes.

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 TOC (Theory of Constraints): Remove bottleneck to resolve constraints.

 Lean: Eliminate waste.
 Six-Sigma: Reduce Variations.

CCPM helps to overcome following phenomenon:

 Parkinson’s Law: Work expands to fill the available time.

 Student Syndrome: People start to work in full fledge only when deadline is near.
 Murphy's Law: What can go wrong will go wrong.
 Bad Multi-Tasking: Bad multitasking can delay start of the successor tasks.

CCPM is based on:

 Resource constrained situations.

 Optimum use of Buffer (amount of time added to any task to prevent slippage of
schedule)-
• Project Buffers (PB): Amount of buffer time at the end of the project.
• Feeding Buffers (FB): Amount of buffer time at the end of a sequence of tasks.
• Resource Buffers (RB): It is an alert that is used to indicate that resource is
needed to perform a task.

This alert can be set few days before a resource is actually needed.

Comparison of CPM and CCPM results:

According to the results we found above, project duration by CPM traditional approach is 21
days and the project duration for the same amount of work by using CCPM is 16 Days. Using
CCPM:

 Project Duration can be reduced by 25-40%.

 Resources can be utilized effectively.
 Project is fully focused on both critical and non-critical tasks

Question 5: A new railway project is launched in India. Give an example of each

project Influencing factors acronym in PESTLE.

Answer:

PESTLE Analysis in Business Environment: In business PESTLE analysis role is very important.
Originally designed as a business environmental scan, the PESTLE analysis is an analysis of the
external macro environment in which a business operates. These are factors which are beyond
the control or influence of a business, however are important to be aware of when doing
product development, business or strategy planning. PESTLE means-

P- Political, E- Economical, S- Social, T- Technological, L- Legal and E-Environmental

The PESTLE subject should be a clear definition of the market being addressed that is as under:

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 A company looking at its market.

 A product looking at its market.
 A brand in relation to its market.
 A local business unit or function in a business.
 A strategic option, such as entering a new market.
 A potential acquisition.
 A potential partnership.
 An investment opportunity

Now we see in detail of PESTLE factors/Impact of a new Railway project being launched in
India, i.e. opportunities in Rail Logistics Parks in India. It is the study of the Indian context with
a focus on Vapi, Gujarat (PESTLE Analysis of Vapi MMLP).

Political Analysis:

India has stepped up its plans in developing its infrastructure requirements and to promote its
manufacturing and industrial sectors. The central government has launched ambitious plans to
develop these requirements through public private partnerships. Considering the fact that the
present government is the only other government to be re- elected after the government of
Jawaharlal Nehru, we can assume that there will be stability in the policies brought forward by
the present government. However, in a PPP, there is a level of control over the prices
of services provided by the government. This might be problematic for a commercial developer
in getting business to the park. For e.g. The Indian Railways which is under the administrative
directive of the Ministry of Railways, heavily subsidise the passenger traffic on their services
which they compensate by overpricing the freight traffic. The cost of transportation of steel
(ton/km) is three times the one in China. As a result the movement of freight has increasingly
shifted from rail to road. (Economic Intelligence Unit 2008). There is also the issue of high
pricing of the toll on expressways and national highways for road freight traffic which has
added to the costs and/or prevented many truck owners from using these roads for quicker
deliveries. Moreover, changes in regulatory policies at JNPT can affect the margins of logistics
operators. These policies and pricings can have significant impact on the development of the
logistics park and affect growth in the long term.

Socio - Economic Analysis:

The road freight industry is growing at 6-8% every year and is currently worth about INR
1.42trillion. The country’s 4% of roadways carries 60% of the freight traffic. (Cushman &
Wakefield 2008) This has not only increased the logistics costs, inefficiencies increase transport
time, damage cargo and the increase the need to maintain large inventories. The impact to the
Government is that there is an increase in the congestion on the roads which leads to more
wear and tear and damaged roads resulting in high maintenance costs to the government.
(Pankaj & Nimit n.d.) Manufacturers needing storage facilities and other services need to deal
with separate agencies catering to these facilities. This has aided to the increase in the costs of
logistics. Gujarat has an unemployment rate of 13% (Government of Gujarat 2008) and we
know that the development of transport infrastructure is highly labour intensive and the project
will help provide employment to people in and around Vapi. (CII, KPMG 2007) Manpower
spends amount to 4% of sales against the industry average of 8 - 10%. India has a very large
population of young workforce, but there is skills shortage especially in trucking and
warehousing segment which can be addressed by involving multinational players in the market
who will bring their skills and expertise into the Indian business. However, India’s labour
regulations are complex and very restrictive which will hamper growth in the manufacturing

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sector on which the logistics parks are dependent. (Arviset al. 2007) An MMLP can affect the
livelihood of many depending on the trucking industry. However, this will take a long time as
organised logistics is forecasted at just 12% in the next 10 years. Skills development and
training has to be imparted to these sections to reemploy them in other industry.

Technological Analysis:

The Indian logistics sector lacks technological advancement that will hamper the provision
of value added services to the customers. Integrated IT systems are necessary to link ports,
the customs, and various parks to track shipments. Currently, only a few thousand vehicles out
of a total of several millions have tracking system. Multinational logistics operators can bring
their technological expertise into the market and will in turn benefit the local operators in
optimising efficiency. In privatizing the operations of container traffic through rails, there might
be problems faced by new entrants to secure the rolling stock and specialised storage
containers e.g. reefer containers because of limited manufacturing capacity and technical
know-how. This will result in firms to import wagons at high cost. All these factors will increase
the entry barriers for the private operators. (Pankaj & Nimit n.d.) Technology is constantly
evolving and the sustainability of the social, economic and environmental factors is proportional
to the technological advancement. Rail infrastructure is a long term investment, planned for a
life of 30-40 years; therefore any changes in technology will be implemented only at a later
stage. This might reduce the competitive advantage of rail freight. In a survey conducted
among different companies operating in India, It was found that 63.04% of the respondents
felt the most important value added service is access to information about their consignment
movement.

Legal Analysis:

All operators and commercial developers of a MMLP are bound by the Indian legal framework
mainly by two laws. They are:1.

Multimodal transportation of goods act: Multimodal transportation of goods in India is governed

by an Act called the Multimodal Transportation of, Goods Act; 1993. The Act primarily deals
with the multimodal transportation of goods, from any place in India to a place outside India,
on the basis of a multimodal transport contract and formatters connected therewith or
incidental thereto. All parties carrying out business in multimodal transportation has to be
registered under this act. The act deals with regulations regarding the registration of the
service, responsibilities if the consignor/ consignee and the liabilities involved in the service.2.

Foreign Trade Act: Since multimodal logistic park operators have to handle goods exporting
from and importing to India the operators are covered under Foreign Trade (Development and
Regulation) Act, 1992. The act deals with, apart from other issues, the licensing requirements
of the foreign trade, Power of Central Government to make Orders and Announce Export and
Import Policy, Director General of foreign trade and his functions, issue of Importer-Exporter
Code Number and Licence, power of the central government to Search, Seizure, Penalty and
Confiscation of items traded/ premises of the trader etc. Though there is an exhaustive legal
framework protecting the interests of the operators and the customers, the legal system is very
slow and can be a barrier for an operator or developer in this field. In an interview, one of the
trading directors of a large UK multinational revealed that the Indian judiciary, in his
experience was a legal maze and it would be difficult to carry on with business as usual when
the procedural framework makes it difficult for a project to kick start in the first instant.

Environmental Analysis:

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The Dedicated Freight corridor has an enhanced loading capacity in comparison to the existing
facilities in the Indian railways. It has more width, height and an increased train length which
will enable a load carrying capacity of 15,000 tons from the current capacity of 4000 tons.
(Indian Railways 2007) In an interview, one of the senior executives of UK’s largest multi-
modal logistics companies said that the market for CO2 reduction transportation is limited,
especially in the recession where everyone is trying to reduce costs and are not willing to pay a
premium for the service. However, he said that there is a market of retail giants like ASDA and
TESCO who are interested in rail based logistics transport as it is more carbon friendly.

Conclusion:

As the Indian markets are getting more competitive in the coming years, demand for multi-
modal logistics services including value added services is huge. Policy changes like the
abolishment of the CST and opening of free trade and warehousing zones are deciding factors
for more companies to outsource their logistics services to third party contractors.

The traffic projection is for the Vapi project and does not reflect the overall demand of logistics
parks in India. One the largest consumer for such service in the UK is the retail segment.
Taking a cue from the UK market, we can assume that developing a logistics park in urban
locations near to cities like Bangalore, Mumbai, and Chennai can capture greater traffic
generated by both industrial as well as retail customers. To make this an even more attractive
business proposition, value added services like ICT, software support, packaging, testing and
quality control, postponement in manufacturing, etc. can be provided in the logistics parks.

Limitations:

Though the data for the traffic flows and demand have been taken in good faith, there are
limitations to the figures and it is necessary to consider different factors influencing the data
collection. The traffic forecast is calculated by taking into consideration the shift of traditional
traffic flows (road transport) into rail. This can be achieved only when there is a cost advantage
for the customer. The shift of traffic to the MMLP is dependent on the number of competitors in
the area. The projections are forecast based on the assumption there will not be any other
MMLP in this region. Though this might be a possibility in case of a rail based logistics park as
the Indian Railways have a monopoly on the operation and development of this infrastructure,
we have to take into consideration that other MMLP can be developed in the coming years
depending on the demand. If a competitor can offer cost advantage with better service, this
might directly affect the traffic flow to the Vapi MMLP.

Question 6: Describe the most important components of a project planning tool

Answer:

One of the critical factors for project success is having a well-developed project plan. Here is a
10-step approach to creating the project plan, not only showing how it provides a roadmap for
project managers to follow, but also exploring why it is the project manager's premier
communications and control tool throughout the project.

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Step 1:

Explain the project plan to key stakeholders and discuss its key components. One of the most
misunderstood terms in project management, the project plan is a set of living documents that
can be expected to change over the life of the project. Like a roadmap, it provides the direction
for the project. And like the traveller, the project manager needs to set the course for the
project, which in project management terms means creating the project plan. Just as a driver
may encounter road construction or new routes to the final destination, the project manager
may need to correct the project course as well. A common misconception is that the plan
equates to the project timeline, which is only one of the many components of the plan. The
project plan is the major work product from the entire planning process, so it contains all the
planning documents for the project. Typically many of the project's key stakeholders, that is
those affected by both the project and the project's end result, do not fully understand the
nature of the project plan. Since one of the most important and difficult aspects of project
management is getting commitment and buying, the first step is to explain the planning
process and the project plan to all key stakeholders. It is essential for them to understand the
importance of this set of documents and to be familiar with its content, since they will be asked
to review and approve the documents that pertain to them.

Components of the Project Plan Include:

Baselines: Baselines are sometimes called performance measures, because the performance
of the entire project is measured against them. They are the project's three approved starting
points and include the scope, schedule, and cost baselines. These provide the 'stakes in the
ground.' That is, they are used to determine whether or not the project is on track, during the
execution of the project.

Baseline management plans: These plans include documentation on how variances to the
baselines will be handled throughout the project. Each project baseline will need to be reviewed
and managed. A result of this process may include the need to do additional planning, with the
possibility that the baseline(s) will change. Project management plans document what the
project team will do when variances to the baselines occur, including what process will be
followed, who will be notified, how the changes will be funded, etc.

Other work products from the planning process:

These include a risk management plan, a quality plan, a procurement plan, a staffing plan, and
a communications plan.

Step 2:

Roles and responsibilities:

Not all key stakeholders will review all documents, so it is necessary to determine who on the
project needs to approve which parts of the plan.

Some of the key players are:

 Project sponsor, who owns and funds the entire project,. Sponsors need to review and
approve all aspects of the plan.

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 Designated business experts, who will define their requirements for the end product.
They need to help develop the scope baseline and approve the documents relating to
scope. They will be quite interested in the timeline as well.

 Project manager, who creates, executes, and controls the project plan. Since project
managers build the plan, they do not need to approve it.

 Project team, who build the end product. The team needs to participate in the
development of many aspects of the plan, such as identifying risks, quality, and design
issues, but the team does not usually approve it.

 End users, who use the end product. They too, need to participate in the development
of the plan, and review the plan, but rarely do they actually need to sign off.

 Others, such as auditors, quality and risk analysts, procurement specialists, and so on
may also participate on the project. They may need to approve the parts that pertain to
them, such as the Quality or Procurement plan.

Step 3:

Hold a kick-off meeting. The kick-off meeting is an effective way to bring stakeholders together
to discuss the project. It is an effective way to initiate the planning process. It can be used to
start building trust among the team members and ensure that everyone's ideas are taken into
account. Kick-off meetings also demonstrate commitment from the sponsor for the project.
Here are some of the topics that might be included in a kick-off meeting:

 Business vision and strategy (from sponsor)

 Project vision (from sponsor)
 Roles and responsibilities
 Team building
 Team commitments
 How team makes decisions
 Ground rules
 How large the group should be and whether sub-groups are necessary

Step 4:

Develop a Scope Statement. The Scope Statement is arguably the most important document in
the project plan. It’s the foundation for the rest of the project. It describes the project and is
used to get common agreement among the stakeholders about the scope. The Scope
Statement clearly describes what the outcome of the project will be. It is the basis for getting
the buy-in and agreement from the sponsor and other stakeholders and decreases the chances
of miscommunication. This document will most likely grow and change with the life of the
project. The Scope Statement should include:

 Business need and business problem

 Project objectives, stating what will occur within the project to solve the business
problem
 Benefits of completing the project, as well as the project justification

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 Project scope, stated as which deliverables will be included and excluded from the
project.
 Key milestones, the approach, and other components as dictated by the size and nature
of the project.

It can be treated like a contract between the project manager and sponsor, one that can only
be changed with sponsor approval.

Step 5:

Develop scope baseline. Once the deliverables are confirmed in the Scope Statement, they
need to be developed into a work breakdown structure (WBS), which is a decomposition of all
the deliverables in the project. This deliverables forms the scope baseline and has these
elements:

 Identifies all the deliverables produced on the project, and therefore, identifies all the
work to be done.

 Takes large deliverables and breaks them into a hierarchy of smaller deliverables. That
is, each deliverable starts at a high level and is broken into subsequently lower and
lower levels of detail.
 The lowest level is called a "work package" and can be numbered to correspond to
activities and tasks.

The WBS is often thought of as a task breakdown, but activities and tasks are a separate
breakdown, identified in the next step.

Step 6:

Develop the schedule and cost baselines. Here are the steps involved in developing the
schedule and cost baselines.

 Identify activities and tasks needed to produce each of the work packages, creating a
WBS of tasks.
 Identify resources for each task, if known.
 Estimate how long it will take to complete each task.
 Estimate cost of each task, using an average hourly rate for each resource.
 Consider resource constraints, or how much time each resource can realistically devoted
to this project.
 Determine which tasks are dependent on other tasks, and develop critical path.
 Develop schedule, which is a calendarization of all the tasks and estimates. It shows by
chosen time period (week, month, quarter, or year) which resource is doing which
tasks, how much time they are expected to spend on each task, and when each task is
scheduled to begin and end.
 Develop the cost baseline, which is a time-phased budget, or cost by time period. This
process is not a one-time effort. Throughout the project you will most likely be adding to
repeating some or all of these steps.

Step 7:

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Create baseline management plans. Once the scope, schedule, and cost baselines have been
established, you can create the steps the team will take to manage variances to these plans. All
these management plans usually include review and approval process for modifying the
baselines. Different approval levels are usually needed for different types of changes. In
addition, not all new requests will result in changes to the scope, schedule, or budget, but a
process is needed to study all new requests to determine their impact to the project.

Step 8:

Develop the staffing plan. The staffing plan is a chart that shows the time periods, usually
month, quarter, year, that each resource will come onto and leave the project. It is similar to
other project management charts, like a Gantt chart, but does not show tasks, estimates, begin
and end dates, or the critical path. It shows only the time period and resource and the length
of time that resource is expected to remain on the project.

Step 9:

Analyse project quality and risks.

Project Quality is consists of ensuring that the end product not only meets the customer
specifications, but is one that the sponsor and key business experts actually want to use. The
emphasis on project quality is on preventing errors, rather than inspecting the product at the
end of the project and then eliminating errors. Project quality also recognizes that quality is a
management responsibility and needs to be performed throughout the project. Creating the
Quality Plan involves setting the standards, acceptance criteria, and metrics that will be used
throughout the project. The plan, then, becomes the foundation for all the quality reviews and
an inspection performed during the project, and is thus used throughout project execution.

Project Risk is an event that may or may not happen, but could have a significant effect on
the outcome of project, if it were to occur. For example, there may be a 50% chance of a
significant change in sponsorship in the next few months. Analysing risks includes making a
determination of both the probability that a specific event may occur and if it does, assessing
its impact. The quantification of both the probability and impact will lead to determining which
the highest risk that needs attention is. Risk management includes not just assessing the risk,
but developing risk management plans to understand and communicate how the team will
respond to the high-risk events.

Step 10:

Communicate! One important aspect of the project plan is the Communications Plan. This
document states such things as:

 Who on the project wants which reports, how often, in what format, and using what
media?
 How issues will be escalated and when.
 Where project information will be stored and who can access it.

For complex projects, a formal communications matrix is a tool that can help determine some
of the above criteria. It helps document the project team's agreed-on method for
communicating various aspects of the project, such as routine status, problem resolution,
decisions, etc.

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Once the project plan is complete, it is important not just to communicate the importance of
the project plan to the sponsor, but also to communicate its contents once it's created. This
communication should include such things as:

 Review and approval of the project plan.

 Process for changing the contents of the plan.
 Next steps-executing and controlling the project plan and key stakeholder
roles/responsibilities in the upcoming phases.

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