• Step 2: Establishing Project Priorities • Step 3: Stakeholder Management • Step 4: Creating the Work Breakdown Structure
BA 4618 – Project Management 3–2
Creating the Work Breakdown Structure
• Work Breakdown Structure (WBS)
–An hierarchical outline (map) that identifies the products and work elements involved in a project. –Defines the relationship of the final deliverable (the project) to its sub-deliverables, and in turn, their relationships to work packages. –Best suited for design and build projects that have tangible outcomes rather than process-oriented projects.
BA 4618 – Project Management 3–3
Hierarchical Breakdown of the WBS
BA 4618 – Project Management 3–4
How WBS Helps the Project Manager • WBS –Facilitates evaluation of cost, time, and technical performance of the organization on a project. –Provides management with information appropriate to each organizational level. –Helps in the development of the organization breakdown structure (OBS), which assigns project responsibilities to organizational units and individuals –Helps manage plan, schedule, and budget. –Defines communication channels and assists in coordinating the various project elements.
BA 4618 – Project Management 3–5
WBS - Example
BA 4618 – Project Management 3–6
Work Breakdown Structure
BA 4618 – Project Management 3–7
Work Packages • A work package is the lowest level of the WBS. –It is output-oriented in that it: • Defines work (what). • Identifies time to complete a work package (how long) • Identifies a time-phased budget to complete a work package (cost) • Identifies resources needed to complete a work package (how much) • Identifies a single person responsible for units of work (who) • Identifies monitoring points (milestones) for measuring success.
BA 4618 – Project Management 3–8
WBS - Exercise Prepare the Work Breakdown Structure for the Mountain Trip Project
1.Mountain Trip Project
1.X 1.X.X Camping Equipments Loading and Unloading Vehicles Cooking Maintenance of Vehicles Equipments and Clothing Mountain Trip Feeding Arrangements Route planning First Aid Kits Sports and Entertainment Equipments Food Menu Planning Travel Arrangements Food Shopping Weather and Road Conditions Control Garments BA 4618 – Project Management 3–9 Step 5: Integrating the WBS with the Organization • Organizational Breakdown Structure (OBS) – Depicts how the firm is organized to discharge its work responsibility for a project. • Provides a framework to summarize organization work unit performance. • Identifies organization units responsible for work packages. • Ties the organizational units to cost control accounts.
• The intersection of work packages and the
organizational unit creates a project control point (cost account) that integrates work and responsibility.
BA 4618 – Project Management 3–10
Integration of WBS and OBS
BA 4618 – Project Management 3–11
Step 5: Integrating the WBS with the Organization (Cont’d)
• Tracking the progress in the execution phase of
the project –vertically on deliverables • client’s interest –horizontally by organizational responsibility • management’s interest
BA 4618 – Project Management 3–12
Direct Labor Budget Sorted By WBS
BA 4618 – Project Management 3–13
Direct Labor Budget Sorted by OBS
BA 4618 – Project Management 3–14
Step 6: Coding the WBS for the Information System
• WBS Coding System
–Defines: • Levels and elements of the WBS • Organization elements • Work packages • Budget and cost information –Allows reports to be consolidated at any level in the organization structure
BA 4618 – Project Management 3–15
Work Package Estimates
• The intersection of the
WBS and the OBS is a budgetary control point.
• Cost accounts include
one or more work package.
• They are used to provide
a roll-up (summation) of costs incurred over time by a work package across organization units and levels, and by deliverables.
BA 4618 – Project Management 3–16
Work Package vs. Cost Account
• Cost accounts (generally) includes outcomes of
more than one work package • CAs do not consume resources or cost money directly • CAs tie the responsible organizational unit to the ongoing work
BA 4618 – Project Management 3–17
Direct Labor Budget Rollup (000)
BA 4618 – Project Management 3–18
Process Breakdown Structure • Process-Oriented Projects –Are driven by performance requirements in which the final outcome is the product of a series of steps of phases in which one phase affects the next phase. • Process Breakdown Structure (PBS) –Defines deliverables as outputs required to move to the next phase . –Checklists for managing PBS: • Deliverables needed to exit one phase and begin the next. • Quality checkpoints for complete and accurate deliverables. • Sign-offs by responsible stakeholders to monitor progress.