Project Management Essentials You Always Wanted To Know

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Project Management Essentials You Always Wanted To Know covers Project Management concepts in concise and easy-to-understand manner for both practising and budding Project Managers. This book includes PRACTICAL APPROACHES and BEST PRACTICES, including TEMPLATES, to be applied to contemporary projects.
The topics covered are:
a)  Overview of Project Management
b)  Project Initiation - Constraints, Stakeholders, PMO, Life Cycles
c)  Project Planning - WBS, PERT/CPM, Budgeting, Risk
d)  Project Execution - Audits, HR, Communications
e)  Project Monitoring & Controlling - Tracking, Quality Control, Change Control
f)  Project Closure
Table of Contents
Helpful Templates
1. Project Management Overview
Project Definition
Reasons for Starting a Project
Project Management
Program and Portfolio
Project Management Office (PMO)
Management by Objectives (MBO)
Organisational Structures
Life Cycles
Project Management Phases
Solved Examples
Practice Exercise
2. Project Initiation
Project Selection
Project Charter
Identification of Stakeholders
Solved Examples
Practice Exercise
3. Project Planning
Scope Planning
Time Planning
Cost Planning
Quality Planning
Human Resource Planning
Communications Planning
Risk Planning
Procurement Planning
Approval and Kickoff Meeting
Solved Examples
Practice Exercise
4. Project Execution
Resource Mobilisation
Perform Project Execution
Team Management
Quality Audits and Improvements
Project Communications
Stakeholder Management
Procurement and Contracting
Solved Examples
Practice Exercise
5. Project Monitoring and Controlling
Schedule and Cost Tracking
Project Reporting
Quality Control
Risk Monitoring
Gaining Acceptance
Managing Contracts
Handling Changes
Solved Examples
Practice Exercise
6. Project Closure
Closing Contracts
Closing Project
Solved Examples
Practice Exercise
Estimating Duration of Activities
Once we have identified the activities and their sequences, in order to put calendar dates we would need to know their durations. Activity duration depends on two things – effort and resources. Effort is the “man days” or “man hours” required to complete an activity. It is the amount of effort that needs to be put on an activity. After estimating the effort the duration can be computed based on the number of resources working on the activity. For example, if the effort is 8 man hours then the duration would be 1 day if one resource works on the activity. It will be about 0.5 day if two resources work on it and so on. Below is the formula for calculating the duration:
Effort = Duration x Number of Resources
Or, stated in a different way, Duration = Effort / Number of Resources
There are several ways of estimating the effort of an activity. Each of these is listed below.
Parametric Estimate
If an activity is about painting a room then one of the most common estimates is to use a thumb rule of how much time it takes to paint one square foot of wall. Next we take the total measurement of all the walls to be painted. We get the final estimate by multiplying the thumb rule with the total square feet. This is called a Parametric Estimate and is generally the most accurate because the thumb rule is made using data from past projects and expert judgement. Another example would be when trying to estimate the time taken to excavate (dig) for building construction. Thumb rule for excavating one cubic meter would be used and depending upon the total volume of the excavation the final figure can be arrived at. In software development projects we regularly use Function Point (FP) based estimation. In this technique we calculate the number of function points and use a standard productivity chart to arrive at the final “man days” estimate of activities. This is also a parametric estimate.
Parametric Estimate = Thumb Rule per unit  x  Number of units
One-time Estimate
There are times when the project manager asks the concerned team member or a subject matter expert to estimate the time required to do an activity. The team member would give a figure based on expert judgement and this estimate would generally contain a buffer. For example, if the project manger asks the team member to estimate the duration for painting a wall, based on the person’s expertise he believes that the work can be completed in 5 days but would rather say 6 days just in case something goes wrong. This buffer is not known to the project manager. Hence, this kind of estimate could be filled with buffers for each activity and all buffers would add up to give a longer than actual schedule. This would also inflate the costs as they depend on the efforts. The situation is worse if there are multiple levels of hierarchy involved in time estimation. If in the above case the team leader asks the team member and gets an estimate of 5 days, he would probably report 6 days as estimate to the project manager as he is unaware of the buffer already been kept by the team member. These buffers add up to create a very inflated schedule. It is not a good project management practice to have buffers. Instead, there should be reserves at the end of the schedule. Reserves are known to everybody and kept for the entire project based on project risks.
PERT (Program Evaluation and Review Technique)
In the previous two estimation types, we used historical data from past projects and/or expert judgement to arrive at an estimate. This is only possible when such work has been performed in the past. However, if the activity is a totally new one or differs enough from the one done in the past, then we may not be able to come up with an accurate figure for the effort estimate. In such cases, we can use PERT. This technique suggests the use of three estimates – Optimistic (O), Most Likely (M) and Pessimistic (P).
An Optimistic estimate is the earliest possible completion of the activity
A Pessimistic estimate is the latest possible completion of the activity
A Most Likely estimate is the most probable completion of the activity
We then apply the PERT formula to calculate the PERT duration of the estimate. It is also called weighted average duration and is given by the formula below:
PERT Estimate O + 4M + P) / 6
For example, if an activity has the following estimates:
O = 5 days
M = 8 days
P = 10 days
Then, PERT Estimate 5 + (4x8) + 10) / 6 = 47 / 6 = 7.833 days
As “Most Likely” has been given four times weight, the PERT estimate would be very close to it.
When using a PERT estimate, we are also interested to know how much risk is involved in the activity’s estimate as that helps us determine the probability of completing the project on time. This is done by calculating the Standard Deviation of a PERT estimate. Formula for calculating standard deviation is give below:
Standard Deviation P – O) / 6
In the above example, the Standard Deviation 10 – 5) / 6 = 5 / 6 = 0.833
It means that the activity can be completed within 7.833 +/- 0.833 days or anywhere between 7 and 8.666 days.
We shall see in the next section how we can calculate the standard deviation of the project when we are using PERT estimates for all activities in the project.
Once we estimate the duration of each activity using one of the above mentioned techniques, we then estimate the number of resources working on each activity. This gives us the activity durations that would be used for scheduling. It must be noted that law of diminishing returns applies to the conversion of effort to duration. For example, if an activity can be completed in 1 day by 1 person, then its duration is 1 day and effort is also 1 day. If we add one more person to the same activity then the duration may not go down to 0.5 days. It will take a little longer than that. This is because there will be an overhead of communication between the two resources. Hence, one needs to use expert judgement when converting effort to duration as it may not be a simple arithmetic calculation.

About the Series


This Self Learning Management Series intends to give a jump start to working professionals, whose job roles demand to have the knowledge imparted in a B-school but haven’t got a chance to visit one. This series is designed to address every aspect of business from HR to Finance to Marketing to Operations, be it any industry. Each book includes basic fundamentals, important concepts, standard and well-known principles as well as practical ways of application of the subject matter. The distinctiveness of the series lies in that all the relevant information is bundled in a compact form that is very easy to interpret.


About the Author
Kalpesh Ashar, a management consultant and corporate trainer holds an M.B.A. (Dean's Award Winner) from S.P. Jain Institute of Management & Research,one of Asia’s top B-Schools, and an Engineering degree with Honours in Electronics. He has over 13 years of experience in large corporations and start-ups in Asia, U.S.A and Europe.
Kalpesh has worked in the capacity of Senior Manager and Program Manager and is passionate about writing on management subjects. While mentoring managers and management students, he realized the need for a series of management books based on quick self-learning. He has authored 10 titles in this series that gives a jump start to managers in understanding all aspects of a business. His technology background gives him a good understanding of the management learning needs of non-M.B.A. graduates. Accordingly, he has authored the titles in this series in a simple to understand manner.
Kalpesh conducts corporate trainings in management subjects and also works as a management consultant for growing companies. He is also affiliated with top business schools in India as a visiting faculty. He is well known as a great mentor in the companies he has worked in and has also received “Best Manager” award.