Master of Business Administration - MBA Semester 2 MB0049 Project Management (4 credits) (Book ID:B1632) ASSIGNMENT- Set 2 Marks 60

Note: Assignment Set -2 must be written within 6-8 pages. Answer all questions. Q1. Discuss the various steps of PMIS planning. Ans. The success of a PMIS depends on its effective planning. The PMIS is used for many purposes by a project manager like budget estimation of costs, creating a schedule, define the scope, etc. Hence, these should be considered while planning for PMIS. The planning of PMIS includes the following steps: (a) (b) (c) (d) Identify the information needed Capture data Process data into information and store it Communicate information to stakeholders

(a) Identify the information needed. Identification of the information that is needed is necessary for improving the decision making and the structure of the PMIS. Information requirements of project stakeholders include the recipients of information, the type of information that is needed, which includes format, contents, and level of details, the time the information is required and how (by what media) will it be communicated to them. (a) Capture data. Term Capture data is used to state a process of preparing and collecting data i.e., as element of a process improvement or similar project. The function of data collection is to attain information to maintain record, to make decisions for vital issues, and to pass information on to others. Data can come from actual observation or from records. Data collected from records is known as secondary data. Data possibly be arranged in tabular form, data array or frequency distribution. (c) Process data into information. An organisation, to achieve its aims, needs to process the data collected into meaningful information. It should be presented in its most useful formats. Data must be processed in a context to give it meaning. Data is transformed into information using mathematical, statistical, or other tools including computer software. Information can be stored in electronic form or hard copies represented in the most useful form. (d) Communicate information to stakeholders. Communication is the process by which information is exchanged between individuals through a common system of symbols, signs, or behaviour. To show the importance of communication, Cleland quotes the following statements:
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(i) Peter Drucker states that the ability to communicate, heads the list of criteria for success. (ii) Harvard Business Review reports that the ability to communicate was at the top among 22 personnel attributes in promotions. (iii) A project manager uses communication more than any other force to manage the project.

Q2. What are the different phases of contract management? Ans. Contract management is the management of contracts which is entered with clients, sellers, partners, or employees. It comprises of negotiating the terms and conditions and ensuring the compliance with the terms and conditions, with documenting and approving on any changes or amendments that may occur during its implementation or execution. As we discussed in the previous section, a purchase order becomes a legal contract after accepting by the vendor or the agent. Most of the projects include a huge amount of capital investment on purchasing the equipment and machinery. Organisations can also get these equipments on a contractual basis. Hence, the project manager needs to negotiate with the suppliers on quality, delivery schedule, price, payment schedule, service, and other relevant legal contractual aspects. The process of deliberation is called negotiation. Contracting has three phases. They are: (a) (b) (c) Contract planning. Contract negotiations. Contract administration.

(a) Contract planning. Contract planning should be done at the project schedule stage. The process of contract planning includes the preparation of resource plans. The following points should be considered for preparing the contract planning of both parties should be reasonable. (i) Work Break Down (WBS) and packaging.

(ii) Requirement of resources, mainly equipment and manpower for various work packages. (iii) Type and numbers of contracts to approximate to whom. be awarded and

(iv) Technical, financial, and operational capabilities of the contractor. (v) (vi) etc. Scope of work for each contractual job. Method of contracting - ICB, LCB, open tender, limited tender,
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vii)

Choosing among suitable and comparable parties.

(viii) Obligations. (b) Contract negotiations. The negotiator brings the buyer and the seller face to face. All assumptions and parameters related to price are analysed. Eventually, a more realistic picture emerges, which is agreed to by both the buyer and the seller. The following aspects should be kept in mind at the time of contract negotiations: (i) (ii) (iii) (iv) (v) (vi) Price-related terms. Payment terms. Dispatch document. Delivery conditions. Agency for inspection. Quantity.

(c) Contract administration. Various problems may arise during the execution of the contract such as: (i) (ii) (iii) (iv) (v) (vi) (vii) Extra work including excess quantities of work. Deleted work including lower quantities of work. Non-compliance with specifications. Delays in time schedules. Late payments. Taking over of completed works. Warranties.

(viii) Contract close out. Q3. Describe the process of project performance evaluation. Ans.1. Performance evaluation is an important tool for the assessment of a system or service according to the measurements specified. We can define it as the systematic process of assessment of effectiveness against predetermined norms, standards, or expressed goals. In management evaluation of any service, process or activity typically refers to "determining its worth". Evaluations of project performance are an independent study which is systematically conducted from time to time to identify the progress of a project and often these studies are conducted by including both experts from within and outside the project. An effective evaluation system has to start from the initial phase of a project life cycle. Projects are assumed to be evaluated vis--vis capital expenditure incurred.
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2. This is a misnomer, since it is not related to the work accomplished. When evaluated in physical terms, the process ignores costs involved. A given quantum of work (e.g. civil construction of 10,000 cubic meters) is completed within the scheduled timeframe, but might have cost more by `2 million over the budgeted cost of `20 million. Both methods do not take into account the efficiency of the project management (in terms of cost and capital inputs in relation to work done or performance). Evaluation inspects the output of a project, programme or policy against its objectives. It also adds the additional value by providing lessons from experience to help future management or development of a specific project, programme or policy. 3. Evaluation is planned from the beginning of the project, and normally includes the following steps: (a) It establishes accurately what is to be evaluated and how past outturns can be measured; (b) It chooses the alternative condition of the world and/or alternative management decisions as counterfactuals; (c) It evaluates the actual outcome with the target outcome, and with the effects of the chosen alternative condition of the world and/or management decisions; (e) (f) It provides the results and recommendations; and Disseminates the results and recommendations.

Q4. Discuss the various elements of project control. Ans. Control of the project is exercised through formal and informal processes exercised by the project manager, project team, and stakeholders. The process of conducting reviews and monitoring reports exerts a degree of control over the project. This discussion will, however, focus on the formal processes of control established by the project plan. As a project has a lot of associated uncertainties, project control is essential. (a) Identify output and performance objective. There are three basic performance objectives/standards for a project which a manager is expected to control. These include time schedule (project duration), project cost, and conformance to design specifications which ensure quality. Two common methods to evaluate these objectives are variance analysis and earned value method. However, variance and earned value analysis are not applied to the objective, quality, as there is difficulty in quantifying it. In this case, the project manager may develop his or her own standards or adopt available ones and tries to ensure that they are met.

(b)Performance monitoring for schedule and cost. This tells who is to monitor the information and at what frequency. Normally, for a moderate size project, a separate project monitoring cell is created for collecting, analysing, and reporting information to all concerned for the purpose of information and controlling the project. The task of the group may include: (i) (ii) Monitor progress. Calculate variance/earned value.

(iii) Prepare variance/earned value report and other reports and send them to all concerned. (iv) Present the report in review meeting.

(v) Compile the measures arrived at in the meeting to deal with variances. (vi) Follow up the implementation of suggested measures Frequency of monitoring depends on nature, duration, and importance of projects and the stakeholders need. Time between monitoring may vary from continuous to several days. Q5. A. What could be the reasons for project termination? Ans. Project termination is one of the most serious decisions of a project management team and its control board. The decision of project termination affects all the stakeholders of the project and can put some negative impact on the organisations growth. So it is important to critically evaluate all the aspects before taking the decision. The project manager and his or her team members will feel that they personally failed. It can also put a negative impact on the team members motivation level and their productivity.
Output/Performance

INPUT RESOURCE: Man M/c Material Equipment PLAN Scope Of Work Schedule Cost budget Quality Specs

Project Execution

Choose/Implement Corrective Measures

Monitor Performanc e

Obtain: Variant=PlanPerformance Forecast 5

The following are the key reasons to terminate a project: (a) Technological reasons.

(b) Results of project requirements or specifications are not clear or impractical. (c) Fundamental change in project requirements or specifications, so that the underlying contract cannot be changed accordingly. (d) Lack of project planning, especially risk management.

(e) The planned result or product of the project turn into obsolete, is not any longer needed. (f) (g) (h) Sufficient human resources, tools, or material are not accessible. The increase in project cost leads lower profit than expected. The parent organisation does not exist longer.

(j) The change in strategy of parent organisation, leads towards the project does not support the new strategy. (k) (l) (m) Essential conditions disappear. Lack of management support Insufficient customer support

B. Write a note on project follow up. Ans. Traditionally, this stage is considered as a part of project completion phase but now it is considered as a separate phase of project life cycle. This is particularly so in very political environments, and/or where project benefits have relatively low visibility and meaning to stakeholders (staff, customers, investors, etc), especially if the project also has very high costs. For example, ICT (Information and Communications Technology) projects often are like this low visibility of benefits but very high costs, and also very high stress and risk levels too. After delivery or completion of the project, the staff performance has to be evaluated. The tasks involved in this phase are: (a) (b) (c) (d) Documenting the lessons learnt from the project Analysing project feedback Preparing project execution report Analysing the problems encountered during the project

Q6. Discuss the advantages of using PM software package. What are the common features available in PM software package? Ans. The following are the key advantages of using project management software: (a) Speed, effort, and accuracy. For a large project, manually carrying out activities like drawing a network, carrying out time analysis, reporting project progress, generation of various types of reports, updating network, and maintaining records is quite time and effort consuming. Use of the software package greatly reduces the time and effort needed for these activities and at the same time enhances accuracy. (b) Ability to carry out special functions. The software has the ability to carry out some special functions like resource scheduling, what if experiment, and export and import of data with ease and within reasonable time. Manually carrying out these functions is extremely difficult or not feasible. (c) Affordability. The price of PC-based software is under $500 which is affordable for an organisation. (d) Easy to use. Over the years, the project management software packages have become easy to use. The package can be handled with minimum training. (e) Maintenance of record. A project generates a lot of data, reports, documents, etc. Manually archiving and retrieving these are time and effort consuming. The software package can handle these functions with relatively less time, effort, and cost. Common Features Available In PM Software Packages. Before knowing the practical use of project management software, we should study some of the common features available in most of the project management software. These generic features include: (a) Data entry features. (i) (ii) (iii) (iv) (v) Project data and calendar. Human resources Labour cost. Human resources available. Cost of construction materials.
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(vi) (vii)

Activity identifier. Activity description.

(viii) Precedence relationship. (ix) . (x) Graphics. Data entry error.

(b) Time analysis. If there is unlimited and flexible resource. In the real world, many projects are managed on this basis. PM packages carry out time analysis which includes calculation of early start, early finish, late start, and late finish; free slack and total slack with ease. Manually carrying out time analysis is tedious. (i) (ii) (iii) (iv) (v) (vi) Resources scheduling. Output reports. Project schedule. Cost related report. Progress report. Updating

(c) Importing/exporting. The process of bringing information into the PM software from other application such as word processing, spread sheet, etc is called importing. (d) Project monitoring and tracking. Tracking the progress about schedule and cost is an important aspect of project management. (e) What if analysis. This is a useful feature of PM software. This permits to know the effect of changes in project variable (people, cost, and change in scope) on project objective.