Electrical Energy Conversion and Power Systems

Universidad de Oviedo

ELECTRICAL ENERGY PROJECT MANAGEMENT

Part 3 Project Organization

Lecturer: Jos ngel Daz lvarez

3. Project Organization
3.1. 3.2 3.3. 3.4 3.5 3.6 1.7 1.8 PROJECT CHARTER TARGETS PROJECT TEAM ACTIVITIES RESOURCES PRECEDENCES DELIVERY TIMES AND COST TARGETS AND PLANNING REVIEW

3. Project Organization
The previous analysis is finished Top Management takes the decision to execute the project Budget is authorized, so it seems that everything is ready to start to use the right resources and commend the execution As we are dynamic and committed with delivery times START QUICKLY!
3

3. Project Organization
START QUICKLY? NO!

This temptation must be avoided. Things are much more complicated Starting quickly for not delaying may have the opposite effect: delay for not preparing, planning and organizing properly In this moment it is needed to develop one of the essential stages for good management and project success: PROJECT PREPARATION, PLANNING AND ORGANIZATION
4

3. Project Organization
Key success to convert opportunity into expected application on time and cost

3.1 Project Charter

Project Constitution Act/Project Charter/Project Definition/Project Statement Is a statement of scope, objectives and participants in a project
Roles and Responsibilities Project Targets Schedule Budget Main Stakeholders Authority of the Project Manager
6

3.1 Project Charter

Document signed by a high level manager/director who has functional authority over all resources and organizations that works in the project. Its approval formally initiates the project.
7

3.2 Targets
Targets have been initially identified clearly, in their triple profile:
Cost Scope Time

This definition has been a base for taking the decision of going on with the project But if, for whatever reason, they have not been clearly specified this is the right moment to do it We can not progress without clear targets, project limits and basic restrictions

3.3 Project Team

At this stage it is also key the nomination of the Project Manager The nomination has to come from a top hierarchical position Formality and Solemnity Authority and Strenght All the company has to understand the importance of this role. NEVER make informal nominations: You please take care of this
9

3.3 Project Team

This nomination has to be associated with a definition of functions that states:

What is expected from him/her Degree of autonomy Decision taking capacity

A Project Management can be invested with different degrees of power and autonomy. Its role it is not always evident The definition of functions must be brief but concise
10

3.3 Project Team

Additionally to the Project Manager it is the right moment to identify other decision centers important for the success of the project:
Top decision and supervision organ Hierarchical head of the Project Manager Controlling organ (Steering Committee, Management Team) Functional directors providing resources to the project

11

3.3 Project Team

Sometimes it may be convenient to nominate other people or groups with a partial participation in the project:
External Consultants Project Managers consultant committee/group

The number of responsibility organs will depend on:

Dimension Complexity Risk Relevance

12

3.3 Project Team

This project structural network is sometimes difficult to represent following a classical hierarchical organization chart, as there is not only hierarchical relations but:
Influence Consulting Client-supplier Functional Etc.

This brings a different type of organization chart

RESPONSIBILITY MATRIX
13

3.3 Project Team

In the rows of the matrix: Decisions or main activities In the columns of the matrix: Different agents/organs with responsibility and decision taking authority In the intersections of rows and columns it is marked the degree of authority for every agent in relation with every decision, using pre agreed keys Example: RACI matrix:
R: Responsible A: Accountable C: Consulted I: Informed
14

3.3 Project Team

Matrix (RACI)

15

3.3 Project Team

If we enter the matrix from the rows we see:
Who is able to take every type of decision Who others may be involved in different degrees

If we enter the matrix from the columns we see:

What is the responsibility of each agent (organ) When they have to be involved and with what degree of authority

The responsibility matrix is a very useful tool to ease and clarify the definition of functions in the project management Every company will have to define its own matrix, coming from its own structure fitted with its own characteristics
16

3.3 Project Team

Project team Once scope is defined, it is required a team to carry out the tasks - Project team should be adequate in size and capacity for task working out - Responsibilities assignment: Every task should have a responsible - Qualities: High performance, Sharing goals, interdependence - Structure: Functional line, Matrix, project dependence hierarqy Project dimensions more typical are two Project teams splited for each dimension

Project

MANAGEMENT CONSTRUCTION

17

3.3 Project Team

Project team: Management dimension
Working colaboration

Negotiation Conflict resolution Reflexion

tools
Design

Data management intervention

18

3.3 Project Team

Project team: Construction dimension

Team working

tools

Orders

administration

Charts / scheems

Intelectual-phisical working Material management

19

3.4 Activities
The targets are defined The Project Manager is nominated Now it is time to choose and draw the path to the finish line Resources must be put in place and activities must be developed in order to approach the finish line gradually One of the first main missions of the Project Manager is the identification of the activities needed to be developed to get to the desired result:
Path Course Pace
20

3.4 Activities
It is a difficult task choose among many options

But very important, not to get lost among obstacles and to reach the finish line
All the relevant ones All of them are useful

It is a technical work:
technical expertise Experience choose not only the feasible path but the advisable one

21

3.4 Activities
This is one of the reasons to consider that the Project Management needs a high professional skills, plus other personal and management ones But it is not possible that the Project Management is a master of all the knowledge areas of a complex project, so he/she can be advised by other experts, both internal or external The responsibility matrix is a very useful tool to ease and clarify the definition of functions in the project management In a big size or complex projects it may be needed a second management step:
Subproject Work packet Activities Tasks Responsibles

22

3.4 Activities
It is the moment to make the project breakdown and second (or third) level responsibles nomination WBS Work Breakdown Structure: Hierarchical (downward) breakdown of project activities into simple elements It defines and organizes the scope of a project The work is divided into smaller pieces, every time more detailed
23

3.4 Activities

WBS Work Breakdown Structure: Hierarchical (downward) breakdown of project activities into simple elements It defines and organizes the scope of a project The work is divided into smaller pieces, every time more detailed

24

3.4 Activities

The lowest level works are the Work Packages The work packages can be scheduled and cost estimated The work packages detail level depends on the size and complexity of the project In order to make a WBS we can use
Templates Previous project examples Experts opinions
25

3.4 Activities

WBS Organization Chart

26

3.4 Activities

WBS Indented
27

3.4 Activities
Just the activities listing is not enough, it is needed a description that allows to understand its:
Sense Content Expected output Execution conditions

Use templates

The description degree of detail will be different from case to case:

Brief description Technical descriptions, drawings, economical assessments, etc.
28

3.5 Resources
The performance of the activities explained before has to be together with the resources to be used in every activity Resource description is another essential element in project planning, as it is one of the aspects that produces more complications in real projects

29

3.5 Resources
Right Human Resources Material Resources in Quantity Quality

Activity development Complexity:

A lot of different resources are used: machines, specialists, subcontractors, etc. Resources are not used in a steady way in time. For every activity different resources are needed in quantity and quality The type of resources used and its quantity mark the project cost Available resources are limited, must be managed carefully
30

3.5 Resources
The decision about what resources to employ in every project phase is a complex decision

Deep technical knowledge Big experience Clear management abilities

are required

There are many ways of developing a certain task playing with different resources in quantity and quality Previous project analysis and study is quite important, comparison among different options to choose the most convenient
31

3.5 Resources

The resource management has impact in

This project (costs, delivery time) Other projects (limited resources)

For every activity it has to be forseen:

What kind of resources will be used In what amount For how long

Resource Nature x Quantity x Time

32

3.6 Precedences
The different project activities are not formally developed neither sequentially nor simultaneously
Sequentially: excessive delivery times Simultaneously: some activities can only be started when other have finished

Establish the most logical and convenient connection between diverse activities to get the optimum cost/delivery times
Some of them are priorities Some of them can be performed in different moments Some of them must be sequentially connected

33

3.6 Precedences
Again it is a difficult work: study the different alternatives in order to opt for the best response Precedence between certain activities is clear, but many others can be developed in one or another moment, depending on the different technical solution or resource availability Standard specific techniques are used: PERT, GANTT, etc.

34

3.7 Delivery Times and Costs

Now we have:
Activities identified Activities ordered in a logical way Resources have been decided COST AND DELIVERY TIMES

Costs come from resources:

Quantity Time of application

Unit costs of every resource is easy to get but needed times of consumption are not so easy
ACTIVITY COST = TIME CONSUMED UNIT COST PROJECT COST = ACTIVITY COST
35

3.7 Delivery Times and Costs

Delivery time of each activity is calculated taking into account the employed resources If we have also established the logical connection of activities:
TOTAL DELIVERY TIME = LONGEST PATH DEFINED BY ACTIVITIES & PRECEDENCES

It is the Critical Path (PERT) In certain projects all the activities are developed sequentially so delivery time is the addition of every individual activity delivery time
36

3.8 Targets and planning review

At the very beginning of the project (see project charter) the targets were defined
Cost Scope Time

but there was not a detailed planning

In the moment we make the detailed planning a conflict may arise:

Delivery times Costs

(It may also enter in conflict with written contracts)

37

3.8 Targets and planning review

This situation is more likely and more accused if the initial planning was not made thoroughly The acceptance of unrealistic compromises can come from the moment when the targets were negotiated, if there were:
Commercial pressing (imperative) Client impositions Bad project study
PLANNING

CONFLICT
RESOURCES

THE PROJECT CAN NOT BE MADE AS PLANNED Unreachable targets Expected delivery times and cost not reachable THE PROJECT CAN BE MADE AS PLANNED But we lack the needed resources Expected dates are not reachable
38

3.8 Targets and planning review

The way of solving both conflict types is different This conflict situation is not extraordinary, it will happen frequently, in different degrees of relevance:
Initial target definition is not so detailed as current one Inial planning responsible Project Manager During initial planning we may have not known some things that now we do (new things that come)

Conflicts are sometimes difficult to solve, but they can contribute to improve the project management

39

3.8 Targets and planning review

What to do when conflict arises?

Potential Actions:
Quit the project Extreme and exceptional
Not very frequent Non reimbursable costs are lost Image is lost

Renegotiate targets with the client

Sometimes only fine tuning of initial targets Sometimes hard negotiation

Reconsider the planning

Introduce modifications in the planning
40

3.8 Targets and planning review

It is always advisable to do it before starting the project than after starting less cost elapsed Activities precedence can be changed Resources an be changed (quantity and time)

We can play with different variables to get the most favorable combination

41

3.8 Targets and planning review

In other words:
It is a mistake to consider that after the project detailed planning if there is no match with the initial planning it means that the targets are set wrongly

Look for alternatives changing planning variables:

List of activities Precedence of activities Resources to be used Quantity of resources Quality specifications
42

3.8 Targets and planning review

The same approach can be taken if the conflict involves resources:
Substitute one resource for another Change the moment when the resource enters Subcontract external resources Extend the resource quantity Try to increment the productivity of a resource

If we share the resources with other projects it can be even more complicated Planning is essential because the projects are complex and the resources are limited
43

3.8 Targets and planning review

TARGETS DEMANDING MULTIPLE DIFFICULT

PLANNING

RESOURCES LIMITED COSTLY RIGID

Resources are:
Limited: nobody has infinite resources Costly: they always have a cost, even if it is an internal one Rigid: affected by restrictions (e.g. experience, knowledge, speed, holidays, sickness, maternal leaves, etc.)

44

3.8 Targets and planning review

Planning is a compromise between targets and resources, it is unstable and we get there by iterations and concessions Planning must be agile and also dynamic
ANTICIPATION ATTITUDES

COMMON SENSE

PROJECT PREPARATION AND PLANIFICATION IS KEY TO SUCCESS

45

Questions & Answers

46

47