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Project Management Glossary
Project Mat Glossary Description and Supplementary Explanation

Project A project has five features specified as follows; (1) A
sequence of tasks has a beginning and an end. (2)
Resources such as manpower, time, money and
facility are used.(3) A final goal is clearly defined. (4)
The goal is achieved under a planned and schematic
approach.(5) The tasks are executed by a team.
A project is unique and there does not exist the same
one. A daily work repeated everyday or regularly is
not called a project.
A construction project has four components
traditionally consisting of schedule, cost, quality and
safety. Recently concept on scope, risk,
communication, organization, project integration etc.
is included.
Project Management Project management is a managing method to carry
Construction out a series of unique and risky tasks by a determined
Management date under limited resources and budget. A project
owner makes a general project management, but
sometimes he asks a PM company almost or part of
his jobs. Sometimes construction management is
assigned to a CM company though a constructing
work is directly ordered to a construction company.
Property management is another word to manage
personal or private properties and assets. Facility
management deals with facilities.
Plant Construction A construction project starts according to the contract
Contract between a client and a PM company in which the
performance and delivery of plant and machinery are
specified. Contracts are classified, according to the
supply scope, into (1) FOB type, (2) FOB type
+Supervisor dispatching, (3) Turn key contract, and
(4) Product-in contract. And they are classified ,
http://www1.neweb.ne.jp/wb/fukud/glossary%20english.htm 1/31/2005
according to the payment form, into (1) Fixed price,

(2) Cost plus Fee, and (3) Unit price. In accordance
with the contract form, project organization and
management style are established. On the other
hand, equipment and materials purchase contracts
and construction contracts are awarded to
manufacturers and subcontractors. Basic conditions
of these purchase and construction contacts shall
conform to the main contract with the client.
Project Management Project Management Institute, USA, describes
Body of Knowledge knowledge and practice as PMBOK required for
PMBOK project management area in addition to those required
for general management area and speciality area.
PMBOK covers integration, scope, time, cost, quality,
human resource, communications, risk and
procurement for a project. The PMP qualification is
required to understand PMBOK.
Project Management PMP is a worldwide qualification certified by PMI,
Professional (PMP) based on the knowledge of PMBOK 2000. As of Aug.
Project & Program 2003, about 68,000 are registered in the world and
Management (P2M) about 3,000 in Japan. 60% of examinees pass the
tests. Details of PMP examination and samples of
questions are shown on PMI page.
P2M is a new certification defined by ENAA (Japan
Engineering Advancement Association). The first test
was carried out in Aug. 2002. The details are
introduced on ENAA page.
Feasibility Study (FS) Planning projects are evaluated whether they should
be carried out or not. Evaluating items are, for
example, products' costs, their marketability, return
forcast, investments, technical powers and influence
on company image. These items are evaluated with
weighting factors. Employing feasibility study is
enable to give a numerical solution in an objective
manner. Payback Period, Discounted Cash Flow
(DCF), Net Profit Value (NPV) or Internal Rate of
ReturnI (IRR) is employed for FS. For plural projects,
FS is also used to determine the order of precedence.
Project Life Cycle
All systems are said to proceed along a biological "S"
pattern. Expenses or manpower of a project has a

typical S pattern. A plant construction project is
broken into four phases, conceptualization (initiation),
planning, executing with controlling, and closing.
Project Phases 1. The initiation phase involves preparation of a
project charter, defining expectation of the client, 2.
The planning phase involves a baseline of a project,
defining tasks and activities, and developing workable
budget and schedule. 3. The executing phase
involves leading project team members to get the
work done as planned, including controlling. 4. The
closing phase is to review the project and issue a final
report.
Project Management According to PMBOK, each phase of a project is
Process systematically executed with five processes consisting
of initiation, planning, execution, controlling and
closing.
Project In order to complete a project on time, within
Management Principle budget and according to expectation of a client, the
following 10 rules shall be abided by. (1) Consensus
on the project goal and scope shall be established. (2)
The best project team shall be built.(3) The best
project plan shall be developed and always kept up-
to-date. (4) Sufficient resources shall be prepared. (5)
A realistic schedule shall be developed. (6)
Importance shall be put on personnel. (7) Formal and
ongoing supports from a client and related divisions
shall be obtained. (8) Communications with a
client and related people shall be closely kept.(9)
Changes shall be willingly accepted, and, (10) New
methods, tools and technologies shall be introduced
as necessary.
Project Resources Resources available in a project are normally
manpower, monetary fund and materials. In addition
to them, machine and methods are included in the 5M
resources. It must be kept in mind that the resources
available in a project are limited physically and
monetarily. Recently, intelligence or information like
intellectual property is sometimes considered as one
of resources.
Project Mission (Charter) The mission or charter is issued by the top or a
division manager at commencing a project to
authorize the project and nominate the project
manager. It also clarifies the project objectives and
supports from the top management. In 1970s' TV
program, Mission Impossible, a team leader played by
Peter Graves received a cassette tape saying "This
tape will self-destruct in five seconds." The project
mission, however, must be kept open and sustained.
Project Rule Project rules are worked out by a project manager
and his team members to specify the statement of
work such as project target, scope of work, budget
and schedule, project organization, the responsibility
chart and the communication plan. Standard rules
shall be prepared and renewed by a project
administration group.
ＰｒｏｊｅｃｔＭａｎ A department to support projects carried out in an
ａｇｅｍｅｎｔＯｆｆ organization. Ｉｔ accumulates data of past projects
ｉｃｅ and utilizes them for future projects. For example, it
prepares project management tools, establishes
standard rules, manages and distributes resources,
trains project managers and members, and even
selects and ranks projects.
Project Organization There are three types of organization to execute a
project in an enterprise, (a) functional organization, (b)
pure project organization and (c) matrix organization.
Project manager's authority is the strongest in (b) and
the weakest in (a). For the successful project
organization, 3Cs (Communication, Cooperation and
Coordination) are required.
Functional Organization The existing line (functional) organization is used, as it
is, to execute a project. A project manager as staff to
the line organization can clarify his responsibility. This
organization is easily accepted by the already
established organization. Sometimes the project
manager is not strong enough to control his team
members.
Pure Project Organization When several projects are concurrently carried out,
this organization is adopted. The product-wise
organization is applied to a project. The responsibility
of the project manager is clearly defined, but the
project cost tends to increase due to excess
resources.
Matrix Organization In actual, this organization is most frequently adopted.
A line manager is responsible for his functional
organization and a project manager for the project
execution. This organization is flexible to easily
correspond to changes and make the enterprise
active and vigorous.Each project member, however,
has two boss, a line manager and a project manager
at the same time, and this sometimes makes him
allergic.
Linear Responsibility The power and responsibility of the related
Chart (LRC) management are defined and shown on a chart.
Regarding line managers, a project division manager
and a project manager, the chart shows who works
out a plan, who approves it, who must be consulted,
who must be notified, and who supervises a job.
Stakeholder A stakeholder is one affected by the work or the
outcome of a project. This word often appears in
foreign books. It includes customers, executives,
managers of team members, venders, contractors
and team members.
Project Manager A leader for a project is a project manager. In addition
to common sense on buisness and knowledge on
project management, (1) he must be enthusiastic for
the project, (2) he can manage changes and
modifications effectively, (3) he can be tolerant toward
ambiguity of organization and members' behavior, (4)
he has negotiating skills and can build coalitions
among project related people, (5) he must consider a
client first and know client's intentions, and (6) he
must keep the business aspects in mind.
Project Member A project member is given a work package from a
project. The package belongs to responsibility of the
line manager. The member works for the project as
representative from the functional division, though

having two bosses of line and project.
Work Breakdown A project can be broken down into tasks or activities.
Structure (WBS) WBS has a tree diagram according to a required level.
The WBS of the first level in a plant construction is,
for example, civil & architectural, mechanical,
electrical, instrumental works and test running. WBS
is used for defining members' roles, working out
schedules and compiling budgets. The minimum unit
of WBS is a task. A task has a duration of one week
to ten weeks. Tasks with too short duration are not
advised. In actual, WBS is often practiced without
recognizing it.
Activity A minimum element of a project job is called an
Task activity. Some PM software defines each element is a
task and a series of same task is an activity. Others
say they are synonymous. A task or an activity shows
kind of job, including information of duration, cost and
resources. A task moves to a next task by way of an
event. refer to Network.
Project This is a management system to be introduced in
Management Information large scale projects, in which all information is
System (PMIS) gathered and controlled according to the progress of
the project. The objects contain documents,
schedules, machinery and materials, manpowers,
costs, cashflow. This concept shall be taken into
account in small projects. Project management
software packages which attach importance on
schedule and resources are adopted in small and
medium scale projects.
Project Software packages plan and manage projects. In a
Management Software small project, a Gantt chart written by MS Excel works
effectively. In order to make a PERT chart, a software
package is needed. The famous ones are Microsoft's
MS Project® and Primavera Systems' SureTrak®.
There are many packages made in Japan in addition
to above Japanese versions. These are helpful for a
project manager to plan and expedite the project
effectively.
Risk Management In a project, in particular, like an overseas plant

construction, there are delivery accidents, payment
troubles and risks due to being executed in an
overseas country without experience and supporting
system. A plant also has proper risks such as
accidents during construction, machinery defects or
contract changes. At a project start, measures shall
be taken for each identified risk, taking into
consideration its happening probability and
seriousness of effects.
Conflict Management Due to organization and authority at the project
initiation stage and due to schedule, budget, quality in
the execution stage, conflicts arise. There are no
projects without conflicts. Results of conflicts often
end in changes. If a project manaer notices a sign of
conflict, he should go there, watch the site, listen the
story of the involved and recognize the fact. In
accordance with the conflict, he resolves the trouble
by means of withdrawing, smoothing, comprpmising,
confrontation and forcing. The best result of solution
of the problem is win-win, and "after rain comes fair
weather".
Project Start Items specified in the contract such as target, scope,
work schedule and payment schedule are clearly
shown on a chart. Meetings with the client, project
related people and project members are held to
determine work procedure, communication methods,
problem and risk management, and change handling.
Project Planning Based on the contract, project members compile
confirmed facility specifications, a workable schedule
chart and a workable cost table. Quality and safety
shall be also checked. Due to sever business
competition, the contract is sometimes awarded with
undue price or delivery. The project members prepare
a realistic plan on schedule and cost, and make
persons concerned recognize it. They also list up
expected problems and risks, and countermeasures
for them. By the way, some contingency will make it
easy for a project manger to fix his decision for project
risks and additions.

Project Execution Execution follows the project plan. Projects contain
problems and risks such as quality defects or
construction mistakes without exemption. The
earlier they are discovered, the less damages to
schedule and cost become. The later discovery is
made, the worse influence appears. Projects also
contain change works. Execution of change works
without confirming their accounts, it caused troubles
later.
Project Control A project progress status shall be always monitored
and compared with the plan. If deviation appears, its
effect shall be checked and measures shall be taken.
For example, schedule delays, budget surpassing or
quality defects can not be avoided, which are beyond
the plan. Problems shall be detected earlier, causes
confirmed quickly and measures taken right away. It is
important to involve the client and the project related
people, consult them and negotiate with them in early
stage. Introduction of risk management to handle
problems is important.
Project Termination A project does not complete even if a plant is
accepted by a client. It does not finish until final
documents, completion reports, and review and
proposal reports are issued. Phaseout or closure is
another expression of termination.
Schedule Control In the planning stage, the schedule is worked out in
detail employing various project software. Possible
shortening idea of schedule shall be included. This
schedule will be a baseline plan for project execution.
Periodically or at any milestone, it must be checked.
Slippage from the baseline or delays shall be
recovered by increase of workers, extension of
working hours, change of job order, simultaneous or
parallel works, addition of construction machine,
introduction of new contractors etc.. These actions,
however, affect the construction cost.
Network A task has duration, an amount of elapsed time. Task
duration is estimated, e.g. in hours, days or months. A
task has predecessor (s) and successor (s). and it is

also called an activity. A network is configured by
linking dependent tasks with arrow line(s). Almost
tasks have dependence of FS (Finish to Start). A
minimum amount of time by which an activity can be
extended is a float or a slack on the network. A
starting point of a task or an activity or an ending
point of a task is event.
Program Evaluation and PERT is a typical network generally worked out with
Review Technique computer software, linking the dependency of
(PERT) activities. The network clearly shows influence of task
Precedence Diagram delay to the project in general.
Method (PDM) PDM is a format of PERT, which shows tasks
surrounded by rectangles and dependencies with
arrows connecting tasks.
Critical Path Method CPM is the longest sequence of activities from
(CPM) beginning to end in a network and usually a sequence
with zero float. At each timing, a current critical path
must be recognized by a person in charge to keep a
schedule.
Gantt Chart Gantt chart bars represent tasks ,in length,
proportional to their duration on a horizontal time line.
A network is expressed in a bar chart, where a float is
shown in a dotted line. In small projects and weekly or
monthly plans of large projects, schedules are
expressed in bar charts manually written with MS
Excel. Floats are not normally shown as they invite
work looseness. A gantt chart was firstly used for a
shipbuilding job in 1917 by Henry Gantt（an
associate of Frederick Taylor, sceientific
management).
Critical Chain Project In order to complete projects on time, CCPM suggests
Management (CCPM, to remove safety from tasks and aggregate it as
TOCPM) "buffers" to be managed by a project manager, and to
make resource dependencies for multi-job or multi-
project in addition to task dependencies. The concept
comes from the Theory of Constraints by Eliyahu M.
Goldratt.
Cost Management A workable budget is compiled for a contract price.
The budget shall be revised after inquiring equipment,

materials and construction works in due course of
engineering. As most of the budget is the equipment
cost, manufacturersto be inquired, specifications,
number of equipment and layout shall be carefully
examined, prior to placing orders, to realize saving.
Same consideration shall be made on designing and
construction works. After placing orders, cost increase
due to changes and additions shall be minimized.
Note that cost must be managed together with
schedule.
Value Engineering (VE) Value is evaluated by an equation of V=F/C (F;
(Value Analysis VA) function, C; cost). VE is achieved by a systematic and
organized teamwaork, with reduced cost and
increased function. VE is carried out at design, inquiry
and work execution stages, among which the design
stage has the highest effect. VE or VA was developed
by Mr. Larry Miles, 1947 when he was a purchasing
officer in GE,
Earned Value EVMS is a system to monitor and control an ongoing
Management System project with BCWS,ACWPand BCWP. By showing
(EVMS) curves of BCWS,ACWPand BCWP to date, the
Earned Value Analysis present and future status of the project is recognized.
(EVA) This system was defined in DoD Instruction as
C/SCSC.
Note that in case of payment by a earned value basis
only, ACWP is equal to BCWP. Difference between
ACWP and BCWP shall be considered when payment
is made on a part time basis, which leads to BCWS,
ACWP and BCWP control.
Budgeted Cost of Work It is called Planned Value too. BCWS is compiled at
Scheduled (BCWS) project start. All costs shall be defined for all tasks.
Planned Value There are two types of expenses, time-base expense
and fixed expense. BCWS of an ongoing task is
calculated with (budget cost * planned progress),
while the planned progress is calculated with(task
duration/planned duration).
Actual Cost of Work ACWP or Spent Cost is a sum of money paid from the
Performed (ACWP) project. To a part-time worker, a sum of (unit cost *
Spent Cost working days) is paid. A fixed money is paid to a lfixed

price contractor.
Budgeted Cost of Work BCWP or Earned Value is calculated with budget cost
Performed (BCWP) * actual progress ratio. A completed task is a progress
Earned Value ratio of 100%. For example, the progress ratio is 40%
in case that 20 sheets are completed for a design
work of total 50 sheets. The payment will be 120
thousand yen for the work of 300 thousand yen
BCWS.
Cost Variance (CV) CV=BCWP-ACWP A minus CV means more money
Cost Performance Index is paid than the actual progress.
(CPI) CPI=BCWP/ACWP The index shows a deviation of
project cost.
Schedule Varience (SV) SV=BCWP-BCWS A minus SV means an actual
Schedule Performance work is less than a budget, or, an actual task is
Index (SPI) delayed.
SPI =BCWP/BCWS The index shows a deviation of
schedule.
Critical Ratio Critical Ratio=SPI*CPI、or CR=(BCWP/BCWS)*
(BCWP/ACWP) The project progress can be judged
by this ratio. Good for 0.9<CR<1.2, check for
0.8<CR<0.9, and red flag for 1.2<cr<1.3.
Budget at Completion BAC is a budget at completion, which was compiled at
(BAC) project start. EAC is an estimated budget at a certain
Estimate at Completion timing during the project execution. Three methods
(EAC) are used to estimate EAC.
ABC Management Accumulated total is calculated in the order of quantity
size, and classified into A, B and C. Ａ is from the
maximum to 80%, B is from 80% to 95%、Ｃ is from
95% to 100%. Controlling is made in accordance with
A, B and C order. This is different from "Activity Based
Costing" employed in a trading industry.
Quality Management Specifications on equipment and materials, facilities
and construction works required by the client are
quality standards. Standards of descriptions and
performances shall be clarified for purchasing and
manufacturing equipment and materials and for
practicing construction works. Organizations,
methods, standards and timings of inspection for them

shall be established. In the construction stage,
mistakes and defects in manufacturing and
constructing take forms and appear, and they shall be
discovered without delay.
Safety and Health From the initiation stage, importance shall be put on
Management workers' safety and health. As grave accidents often
occur particularly in the construction stage, safety
organizations, workers' education, improvement of
working environment, safety facilities, safety
equipment and workers' safety behavior shall be
noted. Safety at construction sites begins with
housekeeping (neatness, orderliness, cleanliness). It
is the employer's responsibility to supply PPE
(Personal Protection Equipment) to workers. SHE
means Safety, Health and Environment.
Safety Task Assignment Before assigning a worker to any job, his foreman is
(STA) responsible for giving him STA as well as job
instructions. STA is safety precautions and actions to
be taken before proceeding with a task. Each worker
must understand and follow his own STA.
Tool Box Meeting (TBM) TBM is a shop floor meeting (beside a tool box) led by
a foreman or a supervisor every morning. Greetings,
mutual checks of health and PPE, and assignment of
today's task are a main item of TBM.
Safety Check 5 Minutes SC-5 means that every worker checks his workplace
(SC-5) for five minutes at the beginning and at the end of the
work to make sure that all hazards are properly
contained.
Hazards Prediction KYT is a training program to give workers sensibility
Training (KYT or HPT) for hazards prediction. Usually, a simple sketch of
working conditions is shown to a group of workers to
ask their free opinions on expected hazards. The
leader summarizes the most possible hazard and
explains the prevention measures. Finally, all
members say together the conclusion loudly to
memorise it.
Lost Time Injury/Illness LISR is the rate of number of workdays lost per
Severity Rate (LISR) 200,000 exposure hours.

LISR = (Days lost)*200,000/(Total exposure hours)
Note: based on OSHA index
Recordable Injury/Illness RIR is the rate of recordable injury/illness cases per
Rate (RIR) 200,000 exposure hours.
RIR = (Days lost)*200,0000/(Total exposure hours)
Note : based on OSHA index
Reference：
Project Management by 1.Jack R. Merdith et al, 2.Sunny and Kim Baker, 3.David I.
Cleland, 4.Harold Kerzner, 5.Marion E. Hayns, 6.Gary R Herrkens、7.Donna Deeprose
Project Planning, Scheduling & Control by James P. Lewis. The Fast Forward MBA in
Project Management by ; Eric Verzuh.
Professional Construction Management by Donard S. Barrie et al. Construction Safety by
Jimmie W. Hinze.
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Project Management Glossary Page 1 of 13

| To Home Page of Project FKD | To English Top Page |

Project Management Glossary

Project Mat Glossary Description and Supplementary Explanation

according to the payment form, into (1) Fixed price,

pattern. Expenses or manpower of a project has a

representative from the functional division, though

Risk Management In a project, in particular, like an overseas plant

risks and additions.

task has predecessor (s) and successor (s). and it is

The budget shall be revised after inquiring equipment,

Spent Cost working days) is paid. A fixed money is paid to a lfixed

methods, standards and timings of inspection for them

Severity Rate (LISR) 200,000 exposure hours.

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