MANAGING PROFESSIONAL SERVICES PROJECTS:PROJECT PLANNING

PHASE II: PROJECT PLANNING

Project Planning Purpose

The purpose of project planning is to confirm the project scope and objectives; develop the project organization, schedule, and budget; secure the necessary resources; and create clear expectations about the project organization, timing, budget, and resources.

The project workplan should clearly identify the deliverables that will be prepared and the tasks that need to be performed in order to prepare them. The project planning team uses the project definition as the beginning point for preparing the project workplan. The workplan is typically broken down into phases, activities, and tasks. Deliverables and resources are usually defined at the task level.

The Project Planning Team

A key member of the project planning team is the project manager because he or she will have primary responsibility for executing the project plan. The project planning team may also include one or more members of the project definition team to ensure that the thinking that went into defining the project is reflected in the project plan. If the project definition team is not represented on the project planning team, a draft of the project plan should be reviewed by one or more project definition team members.

Other members of the project planning team might include appropriate technical specialists and others who may be team members during project execution.

Project Planning Components

There are seven main steps in creating a project workplan:

1. Confirm objectives and scope.

2. Develop work breakdown structure.

3. Develop a detail task list.

4. Assign personnel to tasks.

5. Develop time estimates and a preliminary schedule of tasks.

6. Determine the critical path.

7. Balance the detailed workplan. Each of these steps is described below.

Confirm Objectives and Scope

Often there can be a significant time period between the completion of project definition and the initiation of detailed project planning, which may result in divergent views as to the purpose of the project. It is important that there be full agreement regarding the objectives and scope of the project before the workplan is prepared. The project manager should seek confirmation of the objectives and scope based on input from the sponsor and / or the steering committee as well as the project-definition team members. If there are differences, the project manager should rely on the sponsor to settle them.

Develop Work Breakdown Structure

Developing a work breakdown structure entails expanding the project phases or deliverables into the major activities that need to occur to complete each phase and defining the tasks that need to occur to complete each activity.

Steps for developing a work breakdown structure and examples are presented in Table 1.

The work breakdown structure can encompass more than the three levels shown in Table 1, depending on the nature and complexity of the work to be done. For example, if the work effort has been done many times previously and / or is routine, it may not require more than three levels of detail (phase / activity / task). Conversely, work that is less familiar or more complex may require additional levels of detail to gain a full understanding of the work that must be done.

A work statement (often called a work package) then is prepared to describe the effort for each task or subtask at the lowest level of the work breakdown structure. Each work statement should be designed to ensure that the related task or subtask:

A completed work breakdown structure will include the assembled detail tasks and their relation- ship to respective activities. A work breakdown structure may be displayed according to Figure 1 (in the figure, level 1 corresponds to ‘‘phase,’’ level 2 to ‘‘activity,’’ and level 3 to ‘‘task’’).

Develop a Task and Deliverables List

The different levels of the work breakdown structure should be documented in a task list that identifies each phase, activity, and task (and subtask, as appropriate). Next, the name of the person to be responsible for each task (the task ‘‘owner’’) and a description of the deliverable(s) associated with each task can be added. An example of a detailed task and deliverables list is shown in Figure 2.

When the task and deliverables list is complete, the logical order in which tasks should be

performed is defined. This is done by first determining task dependencies at the lowest level of the work breakdown structure. These dependency relationships can be portrayed in the form of a project network diagram. An example of task dependencies is shown in Figure 3.

Assign Personnel to Tasks

Each task must be assigned personnel resources to perform the work. The steps for assigning per- sonnel to tasks include:

• List the skills required to complete each task.

• Identify candidate team members whose skills meet the task requirements.

• Develop a rough estimate of the time that will be required to complete each task, based on the experience of the candidates.

• Negotiate roles and responsibilities of candidate team members relative to each task.

• Gain commitment from the departments, performance managers, and candidates involved, par- ticularly regarding the team members’ availability to participate.

• Document the team members’ project roles and responsibilities.

The project task assignments can be documented by extending the task and deliverables list (see Figure 2) to include an additional column entitled ‘‘Task Team Members.’’

Develop Time Estimates and Preliminary Schedule of Tasks

The next step is to develop time estimates for each task. The time estimates take two forms:

1. Effort: the actual work time required to complete each task, typically in terms of hours

2. Duration: the elapsed time between the start and finish of a task, typically in terms of days or weeks.

The effort estimates are used to determine the amount of time each team member is expected to spend on the project, as well as the related cost of their services. The task-duration estimates, when combined with the project network diagram (see Figure 4), provide the basis for setting a project schedule (i.e., task start and completion dates).

The effort and duration estimates should be developed from the bottom up, preferably by the persons responsible for their execution, in contrast to the top-down, high-level estimates prepared during the project definition phase. They should take into account past experiences with similar, standard processes, to the extent possible. As predictions, the estimates should be equally likely to be above or below the actual results rather than represent the minimum or maximum time. Figure 4 provides an example of task time estimates.

Size comparability of tasks can be achieved by applying the following rule of thumb: combine a task requiring less than seven hours of effort with another task; subdivide tasks that require more than 70 hours.

Determine the Critical Path

The critical path is the path in the project network diagram that consumes the longest elapsed time. It is the path in which there is no extra time available to accommodate delays. This is in contrast to other paths, where float exists and can be used to accommodate delays. A delay in the critical path will result in a delay of the entire project.

The critical path is identified for two reasons. First, if unexpected issues or changes occur to a given task after the project begins, the impact, if any, on the overall project schedule can be deter- mined quickly. Second, knowing the critical path enables the project manager and team to consider quickly where the schedule can be compressed to accommodate project imperatives and unexpected changes.

Table 2 shows some schedule-compression options that can be considered, along with the asso- ciated caveats.

Balance the Workplan

Resource loading follows the critical path analysis. Resource loading specifies the resources that will be needed for each planning period (typically one week) on the project timeline. The benefit of resource loading is that it identifies conflicts in the schedule (i.e., resources assigned to different

tasks simultaneously). It may reveal resources that are overcommitted or underutilized. It helps the project manager to determine whether tasks need to be rescheduled, work reprioritized, or additional time or resources renegotiated.

The workplan is balanced when all appropriate resources are confirmed and an acceptable com- pletion date is determined. The preliminary schedule, resource availability, and required project- completion date all need to be brought into balance.

Prepare the Project Budget

The primary purpose of preparing a project budget is to estimate the total cost of accomplishing the project. If the budget amount is not acceptable to the project sponsor (the client), then the project workplan will need to be reworked or the project redefined until an acceptable figure is achieved. When cast in time intervals, such as biweekly or monthly, the budget serves as one basis for project monitoring during execution of the workplan.

There are three steps to preparing a project budget:

1. Determine personnel costs.

2. Add support, overhead, and contingency factors.

3. Compile and reconcile the project budget.

This process is not necessarily linear, and some tasks related to these steps may need to be performed as part of the development of high-level cost estimates during the project-definition phase (see Section 4).

Determine Personnel Costs

Project personnel costs are determined by totaling the hours required by each person to perform his or her work on all the tasks to which he or she has been assigned. The person’s total project hours then are multiplied by their hourly billing or compensation rate, as determined by management, to

calculate his or her direct project cost. The costs for all personnel assigned to the project then are totaled to determine the project’s personnel budget. Figure 5 provides an example of how personnel costs might be determined.

Add Support, Overhead, and Contingency Factors

Support tasks and overhead should be included in the detail workplan to account for their impact on project cost and duration. Support refers to all those tasks that facilitate production of the deliverables through better communication, performance, or management. It could be project-related training, meetings, administration, project and team management, report production, and quality assurance reviews.

Overhead is nonproductive time spent on tasks that do not support execution of the project workplan or production of the deliverables but can have considerable impact on the project schedule, the resource loading, and potentially the budget. Overhead could include travel time, holidays, va- cation, professional development, or personal / sick time.

Nonpersonnel costs associated with the project are identified and estimated. Such costs may include travel expense, technology / knowledge acquisition, and contractor assistance.

Finally, contingency factors are considered to compensate for project risks and other potential project issues as well as to accommodate personnel learning curves. Contingency factors may be applied at the phase or activity level of the workplan / budget, although accuracy may be improved if applied at the detail task level.

Figure 6 extends the example from Figure 5 with nonpersonnel costs to arrive at a total project cost.

The budget is compiled by adding personnel costs and all other costs (including contingencies) to arrive at a total budget number. The budget is subdivided into time increments (weekly, biweekly, or monthly) for the expected life of the project, based on the expected allocation of resources and related costs to the time periods in the project schedule. An example of a time-phased budget is shown in Figure 7.

Because the budget is a projection of project costs, it is based on many assumptions. The compiled budget should be accompanied by a statement of the assumptions made regarding schedules, resource availability, overhead, contingency factors, nonpersonnel costs, and the like.

If the project budget is materially different from the high-level cost estimate in the project defi- nition, a reconciliation process may need to occur. This may result in the need to rework / rebalance the project definition, the workplan, and the budget before the sponsor will approve execution of the project.