Project & Operations Management

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Block-II

Project
&
Operations Management
Project Planning and Control
Project & Operations Management

Block

II
PROJECT PLANNING AND CONTROL

UNIT 6
Management of Project Scope 1-29

UNIT 7
Identifying Project Activities 30-50

UNIT 8
Activities: Sequencing, Estimating Duration,
and Scheduling 51-108

UNIT 9
Project Review 109-130

UNIT 10
Project Control 131-174
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July, 2014. All rights reserved
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suggestions from students for improvement in future editions.
BLOCK II: PROJECT PLANNING AND CONTROL
The second block of the course on Project & Operations Management deals with
project planning and control. The block contains five units. The first unit focuses
on the management of the project scope. The second unit examines the
identification of the project activities. The third unit discusses activity
sequencing, duration estimation and activity scheduling. The fourth and fifth
units of the block explain project review and project control, respectively.

The first unit, Management of Project Scope, discusses the project initiation
process and defines project deliverables. The unit focuses on scope planning and
approval of the project overview statement. It also deals with the project
definition statement. The unit also provides an idea about scope verification and
scope change control.

The second unit, Identifying Project Activities, deals with the definition of an
activity. The unit explains work breakdown structure (WBS) and its
development. It also discusses the various tests for completeness of
decomposition of activities. Finally, the unit provides an idea about the various
approaches to defining deliverables in the WBS and about representing the
WBS.

The third unit, Activities: Sequencing, Estimating Duration, and Scheduling,


discusses the fundamentals of the project network diagram. The unit explains
activity sequencing and activity duration. The unit also deals with schedule
development and the various techniques for schedule development. Finally, the
unit discusses schedule control.

The fourth unit, Project Review, explains the importance of project review. The
unit discusses the various types of project reviews and the different stages
involved in project review. The unit also deals with project status review
meetings and the advantages of conducting them. Finally, the unit explains the
various types of project status meetings.

The fifth unit, Project Control, explains the fundamentals of project control. The
unit explains the objectives of control, control as a function of management and
differentiates between control and risk. The unit also discusses the reasons for
measuring duration and cost deviations. It deals with ways to balance the control
system and control change. The unit also defines progress reporting system and
describes the various types of project status reports. It provides information on
the graphical reporting tools and project status review meetings. Finally, the unit
explains the different ways to manage risk and quality.
Unit 6
Management of Project Scope
Structure
6.1 Introduction
6.2 Objectives
6.3 Project Initiation
6.4 Defining Project Deliverables
6.5 Scope Planning
6.6 Approval of POS
6.7 Project Definition Statement
6.8 Scope Verification
6.9 Scope Change Control
6.10 Summary
6.11 Glossary
6.12 Self-Assessment Exercises
6.13 Suggested Reading/Reference Material
6.14 Answers to Check Your Progress Questions

6.1 Introduction
In the last unit of the previous block, we have discussed about project selection.
In this unit, we will discuss the management of project scope. Scope is a brief
and accurate description of the end-products or deliverables to be expected from
a project. It describes all the activities that have to be performed and identifies
the resources that will be utilized for the successful completion of the project.
Scope is also concerned with target outcomes, prospective customers, outputs
and the financial and human resources required for completing the project.
The project manager and the client have to jointly discuss the objectives of the
project. Exchanging views and information will enable them to determine the
purpose of the project. This exchange of information will also help the project
manager understand the client’s expectations of the project and make the client
aware of the project manager’s method for executing the project. On the basis of
this discussion, the client and the project manager prepare a project goal. They
also identify a number of objectives that will help them reach that goal. The
project goals, together with the objectives, determine the scope of the project.
This unit will discuss project initiation process and define project deliverables. It
will then discuss scope planning and approval of the project overview statement.
Then it will explain about the project definition statement. Finally, it would be
discussing about scope verification and scope change control.
Project Planning and Control

6.2 Objectives
By the end of this unit, students should be able to:

 explain the project initiation phase.


 define project deliverables.
 explain scope planning.
 find out how a project overview statement is approved.
 discuss project definition statement.
 explain the concepts of scope verification and scope change control.

6.3 Project Initiation


Projects are initiated only when an opportunity is recognized or when some need
arises. For example, a bank opens new branches in the countryside because of
the growing demand for banking services in rural areas. A company starts a
project for training its employees in ‘Total Quality Management’ because of a
business need. A construction firm starts a project for a new type of structure
because of a client’s request. An electronics firm starts a new project for
developing Internet ready-TVs due to technological advancement. The Election
Commission of India conducts elections to meet a statutory requirement. In other
words, projects are initiated because of specific requirements.

6.4 Defining Project Deliverables


The Project Management Body of Knowledge (PMBOK) defines a project
deliverable as ‘any measurable, tangible, verifiable outcome, result, or item that
must be produced to complete a project or a part of a project’. A list of project
deliverables is jointly prepared by the project manager and the client. This list of
project deliverables is also called ‘Conditions of Satisfaction’.
The list of project deliverables is developed in four steps. They are: request,
clarification, response and agreement.

6.4.1 Request
In the first step, the client requests the project manager to undertake a project as
per his/her requirements.

6.4.2 Clarification
In the second step, the project manager explains what he/she has understood by
the request made by the client. This step is over only when the client feels that
the project manager has understood the request made by him/her.

6.4.3 Response
In the third step, the project manager explains what he/she can do to fulfill the
client’s request. He/she informs the client of his/her capabilities, his/her
schedule, and fees for undertaking the project.
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Management of Project Scope

6.4.4 Agreement
Based on the project manager’s response, both parties continue their discussions. If
both parties are still willing to ahead with the project, they establish the project norms
in this step.
Finally, both parties examine each other’s requests closely to determine how the
project should be executed. The final agreement is documented in the “Project
Overview Statement”.

Activity: Krishna Rajan Electric Company, one of the leading electrical


companies in India, wanted to establish the ERP systems throughout the firm.
The project of implementing the ERP systems was given to Indosoft Systems
Private Limited. Stephen Richards, the project manager of Indosoft Systems
Private Limited and Ramesh Atul, a senior manager from Krishna Rajan
Electric Company discussed what is to be accomplished in the project. They
exchanged their views and ideas and finally listed the project deliverables.
What is a deliverable? Discuss the steps involved in the process of defining
deliverables.

Answer:

Check Your Progress


1. In which of the following stages do the project manager and the client
discuss about going ahead with the project and establishing project norms?
a. Request
b. Clarification
c. Response
d. Agreement
2. Identify the statement that is not true with regard to project scope.
a. Project scope is a brief and accurate description of the end products or
deliverables to be expected from a project.
b. It describes all the activities that have to be performed and identifies the
resources that will be utilized for the successful completion of the
project.

3
Project Planning and Control

c. It is concerned with target outcomes, prospective customers, outputs,


and the financial and human resources required for completing the
project.
d. Only the project goals determine the scope of the project.
3. The objectives of a project should be jointly discussed by the project
manager and the client. Such a discussion would
i. enable the project manager and the client to determine the purpose of
the project.
ii. help the project manager understand the client’s expectations of the
project.
iii. make the client aware of the project manager’s method of executing the
project.
a. Only i and ii
b. Only i and iii
c. Only ii and iii
d. i, ii, and iii
4. From the given sequences, identify the correct sequence of steps in which a
list of project deliverables is developed.
a. Request – Agreement – Response – Clarification
b. Clarification – Response – Agreement – Request
c. Request – Clarification – Response – Agreement
d. Response – Agreement – Request – Clarification.
5. ___________ describes all the activities that have to be performed and
identifies the resources that will be utilized for the successful completion of
the project.
a. Project phase
b. Project scope
c. Project control
d. Project deliverable
6. Identify the step in which the project manager explains what he/she can do
to fulfill the client’s request. In this step, the project manager informs the
clients of his/her capabilities, schedule, and fees for undertaking the project.
a. Request
b. Clarification
c. Response
d. Agreement
7. ‘Conditions of Satisfaction’ is an expression used to represent
a. the scope of the project.
b. the list of project deliverables.
c. exchange of views between the project manager and the client.
d. the objectives of the project.
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Management of Project Scope

8. The final agreement between the project manager and the client regarding
the project is documented in the
a. project plan.
b. aggregate project plan.
c. project progress report.
d. project overview statement.
9. In which of the following steps in developing the list of deliverables does
the project manager explain what he/she has understood by the request made
by the client?
a. Request
b. Clarification
c. Response
d. Agreement

6.5 Scope Planning


Scope planning involves development of the Scope Statement. The project
manager uses tools like product analysis, cost/benefit analysis, and expert
judgment to develop the scope of a project.
Product analysis is a technique for understanding the features and functions of a
product. Techniques like ‘Value Analysis’ and ‘Quality Function Deployment’
help the project manager gain more information regarding the project. By
increasing his/her knowledge of the project’s product, the project manager can
define the scope of the project more precisely. A cost/benefit analysis is
necessary for studying the various tangible and intangible costs and benefits
associated with the project. The project manager also consults experts to
determine the scope of a project.

6.5.1 Scope of a Project

The ‘scope’ of a project can be divided into ‘product scope’ and ‘project scope’.
Product scope details all the functions and features that are to be included in a
product or service of a project. Project scope, however, details the work to be
done to deliver a required product with specific features. The tools and
techniques for managing product scope vary with the nature of the project.

6.5.2 Drafting the Project Overview Statement

The scope of a project is documented in the “Project Overview Statement”. The


Project Overview Statement (POS) is also referred to as Initial Project
Definition, Document of Understanding, Project Scope Statement or Statement
of Work.
The Project Overview Statement should be very specific. For example, “Build a
website like Amazon.com”, is not a scope statement because it does not provide
guidance for building the site. A good scope statement would identify the goal of
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Project Planning and Control

the project and describe how that goal can be achieved. It should be expressed in
a clear and precise manner so that all the project stakeholders understand what
the project is all about. POS should describe what the project is, why it is being
taken up, and what value it brings to the firm. All future decisions regarding the
execution of the project and allocation of necessary resources will be based on
the POS.
A Project Overview Statement is not a static document. As the project
progresses, it has to be revised or redefined. This is because over time the
situation may change and the POS should be documented accordingly.
Depending on the circumstances, it can be modified or rewritten, taking into
consideration the opinions of all the project stakeholders. The scope statements
of large, technological projects often have to be modified because of the high
rate of technological change. The POS should be able to resolve any conflicts
and misunderstandings that may arise among the project members.
6.5.3 Parts of POS
In general, the Project Overview Statement consists of five parts – project
problem/ opportunity; project goal; project objectives; success criteria; and
assumptions, risks, and obstacles.
The POS first identifies the reasons for undertaking the project and then
proceeds to identify the project’s goal. The ‘project goal’ is further broken down
into a number of project objectives. The POS also mentions the criteria for the
success of the project and the various risks, obstacles involved in the execution
of the project.
State the Project Problem/Opportunity
The first part of a Project Overview Statement (POS) states the problem or
opportunities that the project is going to address. This statement need not be
defined rigidly. It should be written in such a way that all project stakeholders
are able to understand it.
The gravity of the problem or the business value of the opportunity stated in this
part will play a major role in getting the attention of the top management. Some
of the situations that give rise to the problems or opportunities that form the
basis of POS are discussed below.
Existing problem/opportunity areas: The POS can address any of the problems
that the firm faces and offer a full or partial solution to the problems. If there are
any opportunities in the market, the POS should explain how the firm can take
advantage of the situation.
Customer request: Any of the requests made by the firm’s internal or external
customers can be mentioned in the ‘list of deliverables’ of a POS. The POS is
thus a useful tool for forwarding customer requests to top management.
Corporate initiative: Employees are encouraged to submit their project ideas in a
POS format. Senior management can then prioritize these proposals and identify
the best proposal or idea for further consideration.

6
Management of Project Scope

Mandated requirements: A change in customer preferences or legal


requirements may also make a firm take up a project. The POS describes how
the firm is going to respond to these mandatory requirements.

6.5.4 Project Goal


In the second part of the POS, the project goal is defined on the basis of the
problem/opportunity stated in the first part of the POS. A project should have a
goal that can catch the attention of top management.
The project goal forms the purpose of the project and provides guidance to the
entire project team. It helps everyone understand what the project is expected to
accomplish. It is also a point of reference for clarifying questions that may arise
about the scope of the project. The goal of the project should be stated clearly
and precisely. Anyone who reads it should be able to understand it without any
additional explanation from the project manager. Technical jargon, if used,
should be explained.
The goal statement should be specific and easy to remember. The firm should be
in a position to implement every point mentioned in the statement. The project
goal statement should not mention any specific dates for starting or completing
the project.
The goal statement should be ‘SMART,’ where S represents ‘specific’ (specific
in addressing the purpose of the project); M represents ‘measurable’ (measurable
indicators of the project’s progress should be established); A represents
‘assignable’ (assignable to a person to complete it); R represents ‘realistic’
(states what can realistically be done with the available resources); and T
represents ‘time-relatedness’ (time required for completing the project).

6.5.5 Project Objectives


The third part of the POS defines the objectives of the project. An objective
statement is a more detailed version of the goal statement. These project
objectives specify the exact boundaries of the project goal.
The project manager should ensure that the objective statement covers the
following aspects of the project – an outcome (a statement of what the project is
going to achieve), a time period (the expected start and completion date), a
measure (the parameters for measuring the project’s success), and an action plan
(A plan for meeting the project’s objectives).

Example: Sample Project Overview Statement


Project Name: Project Manager: Project Code:
Start Date: End Date:
Problem/Opportunity Statement :
Project Goal Statement:

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Project Planning and Control

Project Objectives Statement :


Success Criteria:
Assumptions, Risks and Obstacles:
Prepared by Date Approved D
by at
e

Check Your Progress


10. Identify the statement that is not true with regard to the project goal in the
project overview statement.
a. The project goal forms the purpose of the project and provides guidance
to the entire project team.
b. The goal of the project should be stated clearly and precisely.
c. The project goal statement should mention specific dates for starting or
completing the project.
d. The goal statement should be specific and easy to remember.
11. Initial project definition, document of understanding, and statement of work
are alternative terms used for
a. project overview statement
b. project plan
c. project scope statement
d. Both (a) and (c)
12. Which of the following statements is false regarding the project overview
statement (POS)?
a. POS should describe what the project is, why it is being taken up, and
what value it brings to the firm.
b. All future decisions regarding the execution of the project and
allocation of necessary resources will be based on the POS.
c. A POS is a static document that need not be changed, revised, or
redefined.
d. The POS should be able to resolve any conflicts and misunderstandings
that may arise among project members.
13. Identify the parts of a project overview statement.
i. Project goals and objectives
ii. Assumptions, risks, and obstacles
iii. Success criteria
iv. Project problem/opportunity
a. Only i, ii, and iii
b. Only i, iii, and iv

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Management of Project Scope

c. Only ii, iii, and iv


d. i, ii, iii, and iv
14. Which of the following options do not form part of the process of stating
the problems or opportunities in the project overview statement?
i. The statement should explain the reason for taking up the project.
ii. The statement should be written in such a way that all the project
stakeholders are able to understand it.
iii. The statement should state the outcome and the time period of the
project.
iv. The statement should address the existing problems or opportunities
faced by the organization.
a. Only i and ii
b. Only i and iii
c. Only ii and iii
d. Only iii and iv
15. Identify the techniques among the following options that the project
manager uses to develop the scope of a project.
i. Product analysis
ii. Black box
iii. Cost/benefit analysis
iv. Expert judgment
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
16. Identify the characteristics of a good project overview statement (POS).
i. The POS should be very specific.
ii. The POS should identify the goal of the project.
iii. The POS is a static document that need not be changed, revised, or
redefined.
iv. The POS should be expressed in a clear and precise manner so that all
the project stakeholders understand what the project is all about.
a. Only i, ii, and iv
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
17. The problems or opportunities stated in the project overview statement form
the basis for
a. defining the project scope.
b. defining the project goal.

9
Project Planning and Control

c. screening the project.


d. conducting the technical analysis of the project.
18. Identify the statements that are true regarding the scope of a project.
i. The scope of a project can be divided into product scope and project
scope.
ii. Product scope details all the functions and features that are to be
included in a product or service of a project.
iii. Project scope details the work to be done to deliver a required product
with specific features.
iv. The tools and techniques for managing product scope vary with the
recruitment policy of the organization.
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv

Success Criteria
The fourth part of the POS explains why the project is being taken up. It
describes the business value of the project to the project firm and indicates when
the project can be said to have successfully achieved its objectives. While
preparing this part, the project manager should ensure that the success criteria
are quantifiable and measurable. The success criteria of a project can be:
increase in revenue, increase in market capitalization, etc. The success criteria
should identify the exact benefits that the project can bring to the firm. Success
criteria can also be presented in terms of quantifiable statements like reduced
turnaround time to service a customer, decreased error rates, etc.
On the basis of the success criteria, the top management determines the business
value of the project and allocates resources accordingly. For example, the
success criteria can be written as follows: launching this innovative product in
place of the present product will increase the firm’s sales by 5 percent. If the top
management of the firm is satisfied with the success criteria mentioned in the
POS, it may ask the project manager to explain, in detail, how he plans to
achieve the business value identified in the POS (i.e. an increase in the firm’s
sales). If top management is not satisfied with the success criteria mentioned in
the POS, it might reject the project.
Assumptions, Risks and Obstacles
The fifth section of the POS mentions all the organizational or environmental
factors that may affect the outcome of the project. The project manager uses this
section of the POS to alert senior management about the risks or obstacles that
may influence the project’s activities. This part of the POS also mentions the
contingency plans to be prepared to reduce the impact of the above risks on the
project.

10
Management of Project Scope

Some aspects of projects that are risk prone are discussed below.
Technological aspects: If the project firm does not have any experience in
handling new technology, then the project manager should not choose
technology-related projects. Since it is difficult to manage technical projects,
non-technical firms do not encourage such projects.
Environmental aspects: To design a good POS, the project manager should
understand the environment in which the project operates. Suppose the project
sponsor suddenly leaves the project, the POS should solve this problem by
recommending an alternative sponsor. It should also discuss how the right
people can be acquired to work in crucial areas of the project.
Interpersonal aspects: Good interpersonal relationships among project team
members are essential for the success of any project. All interpersonal problems
should be brought to the attention of top management.
Cultural aspects: The POS should mention how the proposed project is suitable
for the firm. If the project deliverables are completely different from what the
firm is producing, then the project may not be accepted by top management.
Causal relationships: The solutions provided for correcting project problems
depend on several assumptions. So, the project manager should mention the
variables that are likely to affect the assumptions made in the project.

6.5.6 Attachments to POS

Usually, project managers submit a POS that is only one page long. But top
managers often request a more detailed POS that provides additional information
about the business value of the project. Apart from the POS, the top management
usually requests the project manager to submit risk analysis and financial
analysis reports. These reports help managers assess the economic value of the
project.

Risk Analysis

This report describes the various risks associated with proposed project
activities, their probability of occurrence and their severity. Particularly, in
highly technical projects, the project manager should explain all the possible
risks and their likely impact on project results. Formal procedures should also be
mentioned to effectively deal with these risks in the POS.
This analysis also describes risk identification techniques, risk quantification,
and other risk control measures. The project manager also prepares a
contingency plan for dealing with risks. The top management of the firm
analyzes all these risks before accepting the project.

Financial Analysis

The project manager also submits a financial analysis of the proposed project as
an attachment to the POS. The following financial aspects of a project are
analyzed:

11
Project Planning and Control

Feasibility Analysis: A feasibility analysis is conducted to ensure that the


proposed project is financially viable. To do so, a project manager must;
1. Define the problem/opportunity clearly
2. Define the scope of the project, what it includes and what it does not include
3. Identify alternative solutions for the problems
4. Rank the alternative solutions
5. State the expected time and costs required
6. Project the profits from the project
7. List the recommendations.
A thorough examination of the solution and the various alternatives will help the
project manager win the confidence of top management.
Return on investment: The return on investment is the revenue likely to be
generated over a life period of the project against the investments made into the
project. Since return on investment is numerically expressed, it is easy for top
management to identify the most profitable project.
Cost/benefit analysis: The cost/benefit analysis explains the economic and
social justification for the proposed project. But it is difficult to analyze project
costs and benefits as some intangible benefits cannot be quantified. Due to this,
it is very difficult for the project manager to assess all the costs and benefits of
the project. The top management uses its judgment to assess the project and
decide whether it should accept it.
Break-even analysis: Through this analysis, the project manager determines
when the project will arrive at a ‘no profit-no loss’ situation. The top
management accepts the project if the expected time for reaching a break-even
situation is less than the ‘threshold time’ it has in mind.

Activity: The management of Gayatri Machine Works has decided to set up a


unit that manufactures the machine tools required for the firm. Srikanth
Reddy, the in-charge of this project, has prepared the project scope statement
and sent it to the top management for approval. The top management called
Reddy and asked him to submit more reports regarding the feasibility and
economic value of the project. What are the reports that Reddy should include
with the project scope statement? Explain their significance.

Answer:

12
Management of Project Scope

Check Your Progress


19. Identify the financial analysis technique that explains the economic and
social justification for the proposed project.
a. Feasibility analysis
b. Return on investment
c. Cost/benefit analysis
d. Break-even analysis
20. Which of the following options is used by the project manager to determine
when the project will arrive at a ‘no profit-no loss’ situation?
a. Feasibility analysis
b. Return on investment
c. Cost/ benefit analysis
d. Break-even analysis
21. Identify the statement that is not true regarding risk analysis reports.
a. The risk analysis report describes the various risks associated with
proposed project activities, their probability of occurrence, and their
severity.
b. Risk analysis describes risk identification techniques, risk
quantification, and other risk control measures.
c. The risk analysis report does not include any mention of the formal
procedures to deal with the risks in the project overview statement.
d. Both (a) and (b)
22. Environmental, technological, and interpersonal aspects may affect the
outcome of the project. These are mentioned under the ____________
section of the project overview statement.
a. project goal
b. success criteria
c. project problem/ opportunity
d. assumptions, risks, and obstacles
23. Return on investment is
a. the sum of the approved cost estimates (including any overhead
allocation) for activities completed during a given period.
b. total costs incurred (direct and indirect) in accomplishing work during a
given time period.
c. the revenue likely to be generated over the life period of the project
against the investments made in it.
d. the measurable, tangible, and verifiable outcome or result that must be
produced to complete a project.

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Project Planning and Control

24. Arrange the following options based on the sequence in which the project
manager conducts a feasibility analysis of the project.
i. Rank the alternative solutions
ii. Define the scope of the project, what it includes and what it does not
iii. Define the problem/opportunity clearly
iv. State the expected time and costs required
v. List the recommendations
vi. Project the profits from the project
vii. Identify alternative solutions for the problems
a. iii-i-vii-ii-v-iv-vi
b. iii-ii-vii-i-iv-vi-v
c. iii-v-ii-iv-vi-i-vii
d. iii-iv-vi-v-i-vii-ii
25. Which among the following analyses is/are used to assess the economic
value of the project?
a. Risk analysis
b. Financial analysis
c. Critical path method
d. Both (a) and (b)

6.6 Approval of POS


After preparing the POS, the project manager sends it to top management for
approval. Top management examines the proposed project to see if it adds any
business value to the firm. The project manager can be asked some questions by
the management regarding the content of the POS. For example, management
may ask the project manager to expand or contract the scope of the project. They
can also question the validity of the financial analysis and ask the project
manager to justify some of his statements. Depending on the explanation given
by the project manager, management will decide if the project is worth
undertaking.
Approval of the POS indicates that

 Top management is interested in undertaking the project


 The client feels that the project has been understood and a satisfactory solution
has been offered
 Top management feels that the project is well defined.
The management may ask the project manager to identify the resources
necessary for executing the project. Estimates of time and cost can be provided
later by the project manager during the detailed planning stage.

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Management of Project Scope

6.6.1 Participants in the Approval Process


The project manager, project team members, project clients, top management of
the firm and functional heads are the important participants in the project
approval process.

6.6.2 Project Manager


The role of the project manager is crucial. He should draft the POS in such a way
that top management can easily understand it. Moreover, he should persuade
management to approve the project. He should direct the entire project team and
close the project through satisfying the client.

6.6.3 Project Team Members


Usually, the project manager has some prospective team members in mind. He
can consult these members and use their expertise to develop the POS or review
the already prepared POS.

6.6.4 Project Clients


Since the project must be acceptable to the project client, the role of the project
client is very significant. Sometimes the project client himself behaves like a
project manager, when he is fully aware of the project.

6.6.5 Top Management of the Firm


Since top management provides guidance to the firm, their approval is a must for
the project.

6.6.6 Functional Heads


Project deliverables can be produced only when several functions are properly
coordinated. The cooperation of the functional heads is necessary to make the
project a success. For example, if attaining a required level of quality is an
important project deliverable, the contribution of the head of the quality
department is important for making the project a success.

6.7 Project Definition Statement


The Project Definition Statement (PDS) is similar to the POS, but the people
who are involved in the preparation of the statement are different. When
preparing the PDS, the project manager discusses with the project team
members, not the project client. However, the PDS has the same five parts-
structures as the POS: project problem/opportunity, project goal, project
objectives, success criteria, and assumptions, risks, and obstacles.
The PDS provides more detailed information about the project as it is used as a
reference point by the project team for executing the project. The PDS keeps the
entire project team moving in the right direction and also provides guidance to
new project team members.

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Project Planning and Control

Unlike the POS, the PDS is circulated only among the members of the project
team. As a result, technical jargon is used in the document. Since the POS does
not the provide project teams the level of detail required, PDS works as a more
useful tool in project execution.

Activity: A state government gave WindSoft the project of developing a wide


area network connecting all district offices to facilitate e-governance in the
state. Richard Williams, the project manager from WindSoft and the IT
Secretary of the state government, Amar Singh, discussed scope of the
project. Later, both of them documented the scope of the project in the form
of a Project Overview Statement. Williams then prepared a Project Definition
Statement after consulting his project team members. Explain the importance
of a Project Overview Statement and how is it different from a Project
Definition Statement? Do you think both documents are necessary for a
particular project?
Answer:

Check Your Progress


26. Identify the statement that is not true regarding the approval of the project
overview statement (POS).
a. The top management feels that the project is well defined.
b. The top management is interested in undertaking the project.
c. The client feels that the project has been understood and a satisfactory
solution has been offered.
d. The top management wants the estimates of time and cost to be
provided by the project manager in the POS.
27. Identify the statement that is not true regarding the project definition
statement (PDS).
a. The PDS provides more detailed information about the project as it is
used as a reference point by the project team for executing the project.
b. While preparing the PDS, the project manager holds discussions with
the project client.
c. The PDS keeps the entire project team moving in the right direction and
also provides guidance to new project team members.
d. Both (a) and (c)
28. Which of the statements explain the role of the project manager in the
approval of the project overview statement (POS)?

16
Management of Project Scope

i. The project manager should draft the POS in such a way that the top
management can easily understand it.
ii. The project manager persuades the management to approve the project.
iii. The project manager directs the entire project team.
iv. The project manager closes the project by satisfying the client.
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv

6.8 Scope Verification


The Project Management Body of Knowledge (PMBOK) defines ‘scope
verification’ as a process that formalizes the acceptance of the project scope by
the project stakeholders. Here, the project manager reviews the fully or partially
completed deliverables (called work results) to ensure that they have been
completed as per the specifications. The documents that describe the project’s
products or services are also reviewed by the project manager during scope
verification phase.
The project manager also examines and tests the project processes and products
to assess their conformity to project requirements. The project can formally be
said to have started only after scope verification. The formal acceptance of a
project and its deliverables is then distributed to the concerned parties.

6.9 Scope Change Control


Scope change control is the process of controlling the changes in the project
scope that occur at various stages of the project life cycle. Scope change control
involves: managing the factors that cause scope changes to see that changes are
advantageous to the project; and identifying the changes in the scope.
Scope change control must be integrated with other control processes (time
control, cost control, etc.). Project managers use information collected from
various documents to control scope change. They are outputs of Work
Breakdown Structure (WBS), performance reports and change requests.
The Work Breakdown Structure (WBS) is a deliverable-oriented grouping of
project elements that organizes and defines the total scope of the project.
Performance reports organize and summarize the information gathered and
provide information on scope performances (e.g. which interim products have
been completed and which have not).
Change requests occur in different ways. They may be external or internal to the
project, oral or written, legally mandated or optional. These changes may expand
or shrink the project scope. Changes in government regulations and new rulings

17
Project Planning and Control

(by the courts) are some of the external events that can change the scope of a
project. Errors made in defining a project’s product (functions, characteristics,
etc.) and errors made in defining the project’s scope (using a list of deliverables
in place of WBS) constitute internal reasons that lead to changes in project
scope.
Scope change also occurs when a new process that adds value to the project
become available. For example, some new technology that could improve the
execution of the project may become available after the project has been
initiated. Naturally, the project manager would like to take advantage of the
technological change to add value to the project.
The project manager uses a ‘Scope change control system’ to control changes to
the scope of a project. The scope change control system defines the procedures
by which the scope of a project can be changed. The scope change control
system includes paper work, tracking systems, and levels of approval necessary
for authorizing the changes.
Performance techniques like variance analysis, trend analysis, and earned value
analysis help the project manager assess the magnitude of the variations that
occur. The project manager then notes down all the causes of the variations and
takes corrective action.
The scope changes made to the already approved plans (technical plans, financial
plans etc.) are also updated. Then all project stakeholders are informed of the
changes. The causes of variances and the corrective actions taken are
documented for future reference.

Example: Sample Scope Change Request Form


Scope Change Number: An arbitrary numbering scheme, usually 1, 2, 3....
Also, some coding scheme for categorizing the scope change request.
Requested By: Who requested the scope change?
Date Reported: When was the change requested?
Status: Usually Pending, On Hold, In Progress, Complete, Not Approved
Assigned To: Who is assigned to investigate the scope change?
Date Resolved: When was the request resolved?
Scope Change Description: Describe the change in sufficient detail so that
others can understand the scope change request.
Business Benefit: Why is the request being made? What is the benefit from a
business perspective?
Implications of not making the Change: Describe the consequences if the
change is not made.
Impact Analysis to the Project: Describe how the change would be
incorporated into the project, as well as the impact on the project in terms of
cost, effort and duration.

18
Management of Project Scope

Alternatives: If there are any alternatives, note them here, along with their
impact on cost, effort and duration.
Final Resolution: Briefly describe how the scope change was resolved.
Approval from Sponsor for Final Resolution: Signifies that the Project
Sponsor agrees to the resolution, including any budget, effort and / or
duration implications.
Adapted from http://www.tenstep.com.

Check Your Progress


29. ___________ is a deliverable-oriented grouping of project elements that
organizes and defines the total scope of the project.
a. Change requests
b. Performance reports
c. Work breakdown structure
d. None of the above
30. Scope verification is
a. the process of controlling the changes in the project scope that occur at
various stages of the project life cycle.
b. a process that formalizes the acceptance of the project scope by the
project stakeholders.
c. the process of developing a scope statement as a basis for all future
decisions to be taken on the project.
d. a process that involves decomposing the major deliverables into
smaller, more manageable components to provide better control.
31. Identify the statement that is not true with regard to change requests.
a. Change requests are always external to the organization.
b. Change requests always expand the scope of the project.
c. Changes in government regulations, errors in the project’s product, etc.
are some of the events that can change the scope of a project.
d. Both (a) and (b)
32. Identify the statement that is not true regarding scope change control.
a. Scope change control involves identifying the changes in scope.
b. Scope change control controls the changes to the project schedule.
c. Scope change control involves managing the factors that cause scope
changes to see that the changes are advantageous to the project.
d. Scope change control requires repeated execution with other control
processes like time control, cost control, quality control, etc.
33. All the following documents provide information to the project manager to
control scope change except:

19
Project Planning and Control

a. contract files.
b. change requests.
c. performance reports.
d. outputs from work breakdown structure.
34. __________ is the process of controlling the changes in the project scope
that occur at various stage of the project life cycle.
a. Quality control
b. Schedule control
c. Scope change control
d. Risk response control
35. Identify the techniques that help the project manager in assessing the
magnitude of the variations that occur.
i. Simulation analysis
ii. Trend analysis
iii. Variance analysis
iv. Earned value analysis
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
36. Identify the reports that organize and summarize the information gathered
and provide information on scope performances.
a. Change requests
b. Performance reports
c. Work breakdown structure
d. None of the above

6.10 Summary
 Projects are initiated only when an opportunity is recognized, when some need
arises, or because of specific requirements.
 A project deliverable is any measurable, tangible, verifiable outcome, result, or
item that must be produced to complete a project or a part of a project.
 A list of project deliverables, known as the conditions of satisfaction, is jointly
prepared by the project manager and the client. The list is developed in four
steps: request, clarification, response, agreement.
 Scope planning involves development of the scope statement. The project
manager uses tools like product analysis, cost/benefit analysis, and expert
judgment to develop the scope of a project.

20
Management of Project Scope

 The scope of a project is documented in the project overview statement (POS).


After preparing the POS, the project manager sends it to top management for
approval.
 The project definition statement is similar to the POS, but the people who are
involved in the preparation of the statement are different. That is, the project
manager discusses with the project team members, and not the project client.
 Scope verification is a process that formalizes the acceptance of the project
scope by the project stakeholders. The project manager reviews the fully or
partially completed deliverables to ensure that they have been completed as per
the specifications.
 Scope change control is the process of controlling the changes in the project
scope that occur at various stages of the project life cycle.
 Scope change control involves managing the factors that cause scope changes to
see that changes are advantageous to the project; and identifying the changes in
the scope.

6.11 Glossary
 Conditions of satisfaction: A list of project deliverables, which is jointly
prepared by the project manager and the client.
 Cost Benefit Analysis: The economic and social justification for the proposed
project.
 Project Definition Statement: It is similar to a project overview statement, and
it provides more detailed information about the project as it is used as a
reference point by the project team for executing the project.
 Project deliverable: Any measurable, tangible, verifiable outcome, result, or
item that must be produced to complete a project or a part of a project.
 Project Overview Statement: A document that describes the scope of a project.
 Scope Change Control: The process of controlling the changes in the project
scope that occur at various stages of the project life cycle.
 Scope Planning: The process of developing a scope statement as a basis for all
future decisions to be taken on the project.
 Scope Verification: A process that formalizes the acceptance of the project
scope by the project stakeholders.
 Scope: A brief and accurate description of the end products or deliverables to be
expected from a project. It describes all the activities that have to be performed
and identifies the resources that will be utilized for the successful completion of
the project.
 Work Breakdown Structure: A deliverable-oriented grouping of project
activities that organizes and defines the total scope of the project.

21
Project Planning and Control

6.12 Self-Assessment Exercises


1. The scope of a project is a brief and accurate description of the deliverables
to be expected from a project. Define project deliverables. What are the
steps involved the development of a list of project deliverables?
2. The project manager uses various tools like product analysis, and consults
experts to determine the scope of a project. How can the project manager
develop the project scope? What is a project overview statement (POS)?
Describe the different parts of and attachments to a POS.
3. After preparing the POS, the project manager sends it for approval. Give the
reasons as to why a POS needs to be approved. Who are all involved in the
approval process of a POS?
4. More than the POS, a project definition statement (PDS) works as a very
useful tool in project execution. What is a PDS? How is it different from a
POS?
5. The project scope needs to be formally accepted by the project stakeholders
and also controlled at various stages in the project life cycle. How is the
acceptance process of the project scope taken up? Considering that changes
may occur, how is the project scope change controlled by the project
manager?

6.13 Suggested Reading/Reference Material


1. Prasanna Chandra, “Projects,” McGraw Hill, Seventh Edition, 2009.
2. Robert K. Wysocki, “Effective Project Management: Traditional, Agile,
Extreme,” Wiley India, 2009.
3. Jack R. Meredith and Samuel J. Mantel Jr., “Project Management: A
Managerial Approach,” Sixth Edition, Wiley India, 2008.
4. Harold Kerzner, “Project Management-A Systems Approach to Planning,
Scheduling and Controlling,” Second Edition, 2006.
5. “A Guide to the Project Management Body of Knowledge,” Project
Management Institute, Second Edition, December 2000.
6. Joseph Weiss and Robert K. Wysocki, “Five-phase Project Management: A
Practical Planning and Implementation Guide,” Basic Books, 1992.

6.14 Answers to Check Your Progress Questions


Following are the answers to the Check Your Progress questions given in the
Unit.

1. (d) Agreement
The list of project deliverables is developed in four stages, namely request,
clarification, response, and agreement. In the agreement stage, based on the
project manager’s response, both the parties (the client and the project
manager) continue their discussions and arrive at an agreement. If both are
still ready to go ahead with the project, they establish the project norms in
this stage. Finally, both the parties examine each other’s requests closely in
order to determine how the project should be executed.

22
Management of Project Scope

2. (d) Only the project goals determine the scope of the project.
Project scope is a brief and accurate description of the end products or
deliverables to be expected from a project. It describes all the activities that
have to be performed and identifies the resources that will be utilized for the
successful completion of the project. It is concerned with target outcomes,
prospective customers, outputs, and the financial and human resources
required for completing the project. The client and the project manager
prepare a project goal. They also identify a number of objectives that will
help them reach that goal. The project goals, together with the objectives,
determine the scope of the project.
3. (d) i, ii, and iii
Exchange of views between the project manager and the client regarding the
objectives of the project will enable them to determine the purpose of the
project. It will help the project manager understand the client’s expectations
and make the client aware of the project manager’s method of executing the
project.
4. (c) Request – Clarification – Response – Agreement
The list of project deliverables is developed in four stages, namely request,
clarification, response, and agreement. In the request stage, the client
requests the project manager to undertake a project as per his/her
requirements. In the clarification stage, the project manager explains what
he/she has understood by the request made by the client. In the response
stage, the project manager explains what he/she can do to fulfill the client’s
request. In the agreement stage, based on the project manager’s response,
both the parties continue their discussions and arrive at an agreement.
5. (b) Project scope
Project scope describes all the activities that have to be performed for the
successful completion of the project and identifies the resources that will be
utilized for the purpose. A project phase is a collection of related project
activities, which results in the production of one or more major project
deliverables. Project control is the process of collecting information related
to the performance of the project system, comparing it with the desired level
of performance, and taking corrective action to decrease the gap between the
actual and the desired performance levels. A project deliverable refers to
any measurable, tangible, verifiable outcome or result that must be produced
to complete a project.
6. (c) Response
The list of project deliverables is developed in four stages, namely request,
clarification, response, and agreement. In the response stage, the project
manager explains what he/she can do to fulfill the client’s request. He/she
informs the client of his/her capabilities, his/her schedule, and fees for
undertaking the project.

23
Project Planning and Control

7. (b) the list of project deliverables.


The project manager and the client jointly prepare a list of project
deliverables. A project deliverable, as defined by the Project Management
Body of Knowledge (PMBOK), is ‘any measurable, tangible, verifiable
outcome, result, or item that must be produced to complete a project or a
part of a project. This list of project deliverables is also called the
‘Conditions of Satisfaction.’ The other options are wrong.
8. (d) project overview statement.
The list of project deliverables is developed in four stages, namely request,
clarification, response, and agreement. In the agreement stage, both parties
continue their discussions and arrive at an agreement. If both are still
willing to go ahead with the project, they establish the project norms in this
step. Finally, both the parties examine each other’s requests closely in order
to determine how the project should be executed. The final agreement is
documented in the ‘Project Overview Statement’. A project plan is a
formal, approved document used to manage and control project execution.
An aggregate project plan is a concise statement of all project activities. A
project progress report is a formal statement that gives a comparison
between the project progress, accomplishments, and the project plan.
9. (b) Clarification
The list of project deliverables is developed in four stages, namely request,
clarification, response, and agreement. In the request stage, the client
requests the project manager to undertake a project as per his/her
requirements. In the clarification stage, the project manager explains what
he/she has understood by the request made by the client. In the response
stage, the project manager explains what he/she can do to fulfill the client’s
request. In the agreement stage, based on the project manager’s response,
both the parties continue their discussions and arrive at an agreement.

10. (c) The project goal statement should mention specific dates for starting
or completing the project.
The project goal forms the purpose of the project and provides guidance to
the entire project team. The project goal statement should be specific,
measurable, assignable, realistic, and time-related. It should not mention
specific dates for starting or completing the project. Time-related
information about the project is mentioned in the project objectives of the
project overview statement.

11. (d) Both (a) and (c)


The scope of the project is documented in the project overview statement.
The project overview statement is also referred to as initial project
definition, document of understanding, project scope statement, or
statement of work.

24
Management of Project Scope

12. (c) A POS is a static document that need not be changed, revised, or
redefined.
The scope of a project is documented in the project overview statement
(POS). A POS is not a static document. As the project progresses, it has to
be revised or redefined. The reason behind this is that over time, the
scenario may change, and the POS should be documented accordingly.

13. (d) i, ii, iii, and iv


In general, the project overview statement consists of five parts: project
problem/opportunity; project goal; project objectives; success criteria; and
assumptions, risks, and obstacles. The POS first identifies the reasons for
undertaking the project, and then proceeds to identify the project’s goal.
The project goal is further broken down into a number of project objectives.
The POS also mentions the criteria for the success of the project, and the
various risks and obstacles involved in the execution of the project.

14. (b) Only i and iii


The first part of a project overview statement (POS) states the problem or
opportunities that the project is going to address. This statement need not be
defined rigidly. It should be written in such a way that all project stakeholders
are able to understand it. Statements regarding the outcome and the time
period of the project are defined in the project objectives of the POS.
Statements about the reason for taking up the project are explained in the
success criteria of the POS.

15. (b) Only i, iii, and iv


The project manager uses tools like product analysis, cost/benefit analysis,
and expert judgment to develop the scope of a project. Product analysis is a
technique for understanding the features and functions of a product.
Techniques like value analysis and quality function deployment help the
project manager gain more information about the project. A cost/benefit
analysis is necessary for studying the various tangible and intangible costs
and benefits associated with the project. The project manager also consults
experts to determine the scope of a project. This technique is called expert
judgment. Black box is a technique used to develop creativity in
individuals.
16. (a) Only i, ii, and iv
The scope of a project is documented in the project overview statement
(POS). The POS should be very specific. A good scope statement would
identify the goal of the project and describe how it can be achieved. It
should be expressed clearly and precisely so that all the project
stakeholders understand what the project is about. A POS is not a static
document. As the project progresses, it has to be revised or redefined. POS
should describe what the project is, why it is being taken up, and what

25
Project Planning and Control

value it brings to the firm. All future decisions pertaining to the execution
of the project and allocation of necessary resources will be based on the
POS.
17. (b) defining the project goal.
The project goal is defined on the basis of the problems/opportunities stated
in the first part of the project overview statement. The other options are
defined or carried out before drafting a project overview statement.
18. (a) Only i, ii, and iii
The scope of a project can be divided into ‘product scope’ and ‘project
scope.’ Product scope details all the functions and features that are to be
included in a product or service of a project. Project scope details the work
to be done to deliver a required product with specific features. The tools
and techniques for managing product scope vary with the nature of the
project.

19. (c) Cost/benefit analysis


The cost/benefit analysis explains the economic and social justification for
the proposed project. Feasibility analysis is conducted to ensure that the
proposed project is financially viable. The return on investment is the
revenue likely to be generated over the life period of the project against the
investments made in it. Break-even analysis is used by the project manager
to determine when the project will arrive at a ‘no profit-no loss’ situation.
20. (d) Break-even analysis
Break-even analysis is used by the project manager to determine when the
project will arrive at a ‘no profit-no loss’ situation. Feasibility analysis is
conducted to ensure that the proposed project is financially viable. The
return on investment is the revenue likely to be generated over the life
period of the project against the investments made in it. The cost/benefit
analysis explains the economic and social justification for the proposed
project.
21. (c) The risk analysis report does not include any mention of the formal
procedures to deal with the risks in the project overview statement.
The risk analysis report describes the various risks associated with
proposed project activities, their probability of occurrence, and their
severity. This analysis also describes risk identification techniques, risk
quantification, and other risk control measures. Formal procedures should
also be mentioned to effectively deal with these risks in the POS.

22. (d) assumptions, risks, and obstacles


The project overview statement consists of five parts: project
problem/opportunity, project goal, project objectives, success criteria, and
assumptions, risks, and obstacles. The assumptions, risks, and obstacles
26
Management of Project Scope

section mentions all the organizational or environmental factors that may


affect the outcome of the project. Some of the aspects of projects that are
risk prone are technological aspects, environmental aspects, interpersonal
aspects, cultural aspects, causal relationships, etc.

23. (c) the revenue likely to be generated over the life period of the project
against the investments made in it.
The return on investment is the revenue likely to be generated over the life
period of the project against the investments made in it. The return on
investment is numerically expressed, which makes it easy for the top
management to identify the most profitable project. Actual cost of work
performance is the total costs incurred (direct and indirect) in
accomplishing work during a given time period. Budgeted cost of work
performance is the sum of the approved cost estimates (including any
overhead allocation) for activities completed during a given period. Any
measurable, tangible, and verifiable outcome or result that must be
produced to complete a project is called a project deliverable.

24. (b) iii-ii-vii-i-iv-vi-v


A feasibility analysis is conducted to ensure that the proposed project is
financially viable. Following are the steps involved in conducting a
feasibility analysis: define the problem/opportunity clearly; define the
scope of the project, what it includes and what it does not; identify
alternative solutions for the problems; rank the alternative solutions; state
the expected time and costs required; project the profits from the project;
and list the recommendations.

25. (d) Both (a) and (b)


Risk analysis and financial analysis reports help managers assess the
economic value of the project. The risk analysis report describes the
various risks associated with the proposed project activities, their
probability of occurrence, and their severity. Financial analysis includes a
feasibility analysis, return on investment, a cost/benefit analysis, and a
break-even analysis. The critical path method is used in schedule
development. It is a network analysis technique used to predict the project
duration by finding out which sequence of activities (the critical path) has
the least amount of scheduling flexibility.

26. (d) The top management wants the estimates of time and cost to be
provided by the project manager in the POS.
After preparing the POS, the project manager sends it to the top
management for approval. The top management examines the proposed
project to see if it adds any business value to the firm. Approval of the POS
indicates that the top management is interested in undertaking the project,
that the client feels that the project has been understood and a satisfactory

27
Project Planning and Control

solution offered, and that the top management feels that the project is well
defined. Estimates of time and cost are provided later by the project
manager during the detailed planning stage.
27. (b) While preparing the PDS, the project manager holds discussions
with the project client.
The PDS is similar to the POS, but the people who are involved in the
preparation of the statement are different. While preparing the PDS, the
project manager holds discussions with the project team members and not
the project client. The PDS provides more detailed information about the
project as it is used as a reference point by the project team for executing
the project.
28. (d) i, ii, iii, and iv
The role of the project manager is crucial. He/she should draft the POS in
such a way that the top management can easily understand it. He/she should
persuade the management to approve the project. He/she should direct the
entire project team and close the project by satisfying the client.

29. (c) Work breakdown structure


The work breakdown structure (WBS) is a deliverable-oriented grouping of
project elements that organizes and defines the total scope of the project.
Change requests are changes that may expand or shrink the project scope.
Performance reports organize and summarize the information gathered and
provide information on scope performances.

30. (b) a process that formalizes the acceptance of the project scope by the
project stakeholders.
The Project Management Body of Knowledge (PMBOK) has defined scope
verification as a process that formalizes the acceptance of the project scope
by the project stakeholders. Scope change control is the process of
controlling the changes in the project scope that occur at various stages in
the project life cycle. Scope planning is the process of developing a scope
statement as a basis for all future decisions to be taken on the project.
Scope definition involves decomposing the major deliverables into smaller,
more manageable components to provide better control.

31. (d) Both (a) and (b)


Change requests can be external as well as internal to the organization.
They may contract or expand the scope of the project. Changes in
government regulations and new rulings (by the courts) are some of the
external events that can change the scope of a project. Errors made in
defining a project’s product (functions, characteristics, etc.) and errors
made in defining the project’s scope (using a list of deliverables in place of
WBS) are the internal reasons that lead to changes in project scope.

28
Management of Project Scope

32. (b) Scope change control controls the changes to the project schedule.
Scope change control is the process of controlling the changes in the
project scope that occur at various stages of the project life cycle. Scope
change control involves managing the factors that cause scope changes to
see that the changes are advantageous to the project and identifying the
changes in the scope. Scope change control must be integrated with other
control processes like time control, cost control, quality control, etc.
Schedule control controls the changes to the project schedule.

33. (a) contract files.


Project managers use information collected from various documents to
control scope change. These documents include outputs of work breakdown
structure, performance reports, and change requests. Contract files are a set
of indexed documents developed to include the various documents in the
final project records.

34. (c) Scope change control


Scope change control is the process of controlling the changes in the
project scope that occur at various stages of the project life cycle. Schedule
control has similar functions as scope change control except that it controls
changes to the project schedule. Quality control is the process of
scrutinizing specific project results in order to check their compliance with
quality standards. Risk response control is the process of implementing a
risk management plan to address the various risk factors associated with the
project.
35. (c) Only ii, iii, and iv
Scope change control is the process of controlling the changes in the
project scope that occur at various stages of the project life cycle.
Performance techniques like variance analysis, trend analysis, and earned
value analysis help the project manager in assessing the magnitude of the
variations that occur. Simulation analysis is an advanced technique used for
conducting risk analysis.

36. (b) Performance reports


Performance reports organize and summarize the information gathered and
provide information on scope performances. Change requests are changes
that may expand or shrink the project scope. The work breakdown structure
(WBS) is a deliverable-oriented grouping of project elements that organizes
and defines the total scope of the project.

29
Unit 7
Identifying Project Activities
Structure
7.1 Introduction
7.2 Objectives
7.3 Activity Definition
7.4 Work Breakdown Structure
7.5 Developing a WBS
7.6 Test for Completeness of Decomposition of Activities
7.7 Approaches to Defining Deliverables in the WBS
7.8 Representing the WBS
7.9 Summary
7.10 Glossary
7.11 Self-Assessment Exercises
7.12 Suggested Reading/Reference Material
7.13 Answers to Check Your Progress Questions

7.1 Introduction
In the previous unit, we have discussed the management of project scope. In this
unit, we will discuss the identification of the project activities. Identifying
project activities is an important step in the project planning phase after the
project scope statement has been defined. The Work Breakdown Structure
(WBS) is a useful tool for the project manager in identifying the project
activities. It illustrates how each activity of the project contributes to the whole
project in terms of budget, schedule and performance. It also lists the
vendors/subcontractors associated with specific activities of the project.
Software packages like Microsoft’s Project 2000 can generate the WBS
automatically.
A WBS is initially developed with the limited data available and subsequently
revised when additional information is received. This gives the project manager
a clear idea of what the end product of the project will be, and the overall
process by which it will be created. Firms follow different approaches to
developing work breakdown structures. The decomposition of the activities is
continued till the lower activities satisfy some specified criteria. The planned
WBS is then communicated to other project members and further modifications
are done as and when required.
This unit will deal with the definition of an activity. We will discuss the WBS
and its development. We shall then move on to discuss the various tests for
completeness of decomposition of activities. Finally, we would be discussing the
various approaches to defining deliverables in the WBS, and about representing
the WBS.
Identifying Project Activities

7.2 Objectives
By the end of this unit, students should be able to:

 define an activity.
 explain a work breakdown structure (WBS), and .
 developing a WBS.
 test for completeness of decomposition of activities.
 approaches to defining deliverables in the WBS.
 representing the WBS.
7.3 Activity Definition
An activity is an element of work performed during the course of a project. A
project involves a number of interrelated activities. In general, activities share
the following characteristics – each activity is of a definite duration; each
activity uses resources such as people, materials or facilities; and each activity
has a cost associated with it.
A project consists of a series of activities. Every activity of the project has an
activity that goes before it, or one that goes after it, and sometimes both. An
activity that must be completed immediately before the start of another activity
is called a predecessor activity. An activity that immediately succeeds another
activity and which cannot be started until the earlier one has been completed, is
called a successor activity. Two activities which are taken up at the same time
are called concurrent activities. Activity definition involves identification of
specific activities that must be performed in order to produce project
deliverables.

7.4 Work Breakdown Structure


The Project Management Body of Knowledge (PMBOK) defines work
breakdown structure (WBS) as a deliverable-oriented grouping of project
activities that organizes and defines the total scope of the project. A deliverable
is any measurable, tangible, verifiable outcome or result that must be produced
to complete a project or part of a project. The WBS helps the project manager to
ensure that the project includes all the activities needed, and that the project
includes no unnecessary activity.
The breaking down of work into hierarchy of activities and tasks is called
decomposition. The project goal statement is shown at the top of the WBS as a
Level 0 activity. This Level 0 activity is decomposed into Level 1 activities. The
completion of all Level 1 activities means completion of Level 0 activity.
Similarly an activity at level n is said to be completed when its decomposed
activities at Level n+1 are completed.
The decomposition process makes it easy for the project manager to estimate the
duration of the activity, the resources required, and the costs incurred. The
decomposition is done to such an extent that each lower activity should satisfy
the test of completeness.

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Project Planning and Control

7.4.1 Factors Considered in Developing a WBS


The project manager must keep in mind the following issues while designing a
WBS:
1. Every activity in the WBS should produce a single tangible deliverable.
2. Every activity at any level of the WBS is an aggregation of all its
subordinate activities listed immediately below it.
3. Each activity should be unique and distinct from other activities of the
project.
4. The activities should be decomposed logically from higher levels to lower
levels.
5. There should be some flexibility in the WBS development process, as the
WBS might be updated when the project scope changes.
6. The WBS must specify the important reporting points (e.g., review
meetings, monthly reports, test reports etc.) The activities should be
compatible with organizational and accounting structures.

7.4.2 Uses of WBS


The uses of WBS are given below:
Thought process tool: The WBS improves the thought process of the project
manager and his team by designing the entire project in a structured manner. It
helps them to see how the project work can be defined and managed.
Architecture tool: The WBS provides a complete picture of the project and
represents how various activities are related to one another.
Planning tool: The WBS provides a series of activities to be performed to
complete the project. It helps the project manager estimate resources required
and build a schedule for the whole project.
Project status reporting tool: The WBS can also be used as a tool to report the
status of the project. Completion of lower level activities implies the completion
of the corresponding activities at one level above. Completion of some higher
level activities indicates completion of project milestone events and these are
reported to the top management and the project client.

Check Your Progress


1. All the given statements are true regarding work breakdown structure
(WBS) except:
a. WBS is a useful method of schedule development for the project
manager.
b. WBS lists the vendors/subcontractors associated with specific activities
of the project.

32
Identifying Project Activities

c. WBS illustrates how each activity of the project contributes to the


whole project in terms of budget, schedule, and performance.
d. WBS is initially developed with the limited data available and is
subsequently revised when additional information is received.
2. ___________ involves breaking down of work into a hierarchy of activities
and tasks.
a. Crashing
b. Decomposition
c. Fast tracking
d. Solicitation
3. Identify the step in the project planning phase that immediately follows the
defining of the project scope statement.
a. Financial analysis
b. Project selection
c. Project screening
d. Identifying project activities
4. Which of the following options acts as a planning tool and a project status
reporting tool?
a. Critical path method
b. Work breakdown structure
c. Program evaluation and review technique
d. Graphical evaluation and review technique
5. ___________ is an element of work performed during the course of a
project.
a. Event
b. Node
c. Slack
d. Activity
6. Which of the following statements are not true with regard to an activity?
i. An activity is an element of work performed during the course of a
project.
ii. A project involves a number of independent and unrelated activities.
iii. An activity has a cost associated with it.
iv. An activity does not have a definite duration.
a. Only i and ii
b. Only i and iii
c. Only ii and iv
d. Only iii and iv

33
Project Planning and Control

7. An activity that must be completed immediately before the start of another


activity is called
a. a successor activity.
b. a predecessor activity.
c. a concurrent activity.
d. Both (b) and (c)
8. The work breakdown structure (WBS) helps the project manager ensure that
i. the project includes all the activities needed.
ii. the interdependency relationships are identified and documented.
iii. the project includes no unnecessary activity.
iv. specific activities are identified that must be performed in order to
produce project deliverables.
a. Only i and ii
b. Only i and iii
c. Only ii and iii
d. Only iii and iv
9. _____________ involves identifying specific activities that must be
performed in order to produce project deliverables.
a. Scope planning
b. Activity definition
c. Scope definition
d. Activity sequencing
10. An activity at level n is said to be completed when
a. all activities are completed.
b. its decomposed activities at level n are completed.
c. its decomposed activities at level n+1 are completed.
d. its decomposed activities at level n-1 are completed.
11. Which of the following is wrongly stated as a factor to be considered for
developing a work breakdown structure (WBS)?
a. Each activity should be unique and distinct from other activities of the
project.
b. The activities should be decomposed from lower levels to higher levels.
c. Every activity in the WBS should produce a single tangible deliverable.
d. There should be some flexibility in the WBS development process.
12. A successor activity is
a. an activity that must be completed immediately before the start of
another activity.
b. an activity that immediately follows another activity and which cannot
be started until the earlier one has been completed.
c. an activity taken up at the same time as another activity.
d. None of the above
34
Identifying Project Activities

13. From the following options, identify the goals of decomposition.


i. Developing the schedule
ii. Estimating the duration of the activity
iii. Estimating the resources required
iv. Estimating the costs incurred
a. Only i, ii, and iii
b. Only i, ii, and iv
c. Only i, iii, and iv
d. Only ii, iii, and iv
14. Two activities that are taken up at the same time are called __________
activities.
a. predecessor
b. successor
c. concurrent
d. None of the above

7.5 Developing a WBS


The process of developing a WBS can be top-down or bottom-up approach.

7.5.1 Top-down Approach

In this approach, the project goal level is decomposed to lower levels until the
project manager and his team are satisfied that the work has been sufficiently
well defined. The decomposition is continued till the activities of lower level
satisfy the test of completeness.

Once all the activities are identified, the project manager ensures that each
project activity is described in detail, with the time, cost, material, and labor
requirements for each activity being estimated. This is because allocation of
resources is easier at the activity level rather than at the project level. The sum of
all resources allocated for all project activities provides the total resource
requirements for the project.

After the activities are described, the project manager puts them in sequence, so
that a schedule can be drawn up for the entire project. The project manager
analyzes the dependencies among the various project activities to see how many
of the activities can be taken up simultaneously. If some of the activities can be
carried out simultaneously, it reduces the total project duration. There are two
variations in the top-down approach. These are the team approach and subteam
approach.

35
Project Planning and Control

Team approach: In this approach, the entire project team works on all parts of
the WBS. A suitably qualified person is given the responsibility of decomposing
each Level 1 activity. As the entire team is involved in developing the WBS,
members can take note of discrepancies as and when they occur and take
corrective measures.
Subteam approach: In this approach, the planning team is divided into as many
subteams as there are Level 1 activities. Each team is led by an expert who
decomposes the Level 1 activity assigned to his team, taking into consideration
the suggestions made by his team members. The process is continued till each
lower level activity of WBS meets the test for completeness of decomposition.

7.5.2 Bottom-up Approach

Here, as in top-down approach, the entire planning team prepares the first level
breakdown. Then the team is divided into as many groups as there are Level 1
activities. Each group makes a list of all the activities that must be completed to
complete one Level 1 activity. This is done by getting group members to identify
different activities and present these to the group. Every activity that the group
thinks is appropriate, is put down on a slip of paper. Once all the ideas are
exhausted, related activities are grouped together and the final list is submitted to
the planning team. The planning team prepares the final work breakdown
structure by removing redundant activities and adding missing activities. The
drawback in this approach is that the activities are not defined properly.

Activity: The management of Power Oil Ltd., wanted to take up a project of


constructing a refinery. The management appointed Surya Narayana as the
project manager and asked him to develop the Work Breakdown Structure
(WBS) of the project. Narayana, with his team members, prepared the project’s
goal statement. This project goal was broken down to lower level activities till
the entire project work was defined. What kind of approach did Narayana
follow to develop the WBS of the project? At what level can the breaking down
of the activities be stopped?

Answer:

36
Identifying Project Activities

Example: Project Risk and WBS


For projects that are likely to be exposed to higher risks, the WBS should be
very detailed. Each activity faces a different kind of risk and so the project
manager must identify the nature and level of risk that is likely to arise for
each project activity. Certain risks are specific to certain activities. For
instance, breakdown risk is specific to machinery and equipment. An activity
like the documentation of expenses does not face such a risk. Any negligence
in dealing with these risks will have a detrimental effect on the project.
The WBS, by breaking down the project activities, helps identify and mitigate
several risks. For instance, the risk involved in the activity of getting permits
from the regulatory authorities is high. Since it affects several other WBS
activities, the project manager has to analyze its impact on all the other WBS
activities. To effectively deal with the risks involved in the project activities,
the project manager defines a risk plan that describes the contingency
activities that must succeed the risk affected activities.
Some of the questions that the project manager must answer while
considering the project risk for each WBS activity are:
 Is the technology changing faster than the pace of the project? Can the
project include the latest technological innovations?
 Will the quality of the project activities be evaluated through testing and
inspection?
 Does the firm have enough manpower, facilities and resources to produce the
required deliverables?
 Have the risks of social pressures, government approval, understanding
among team members been identified?
Adapted from “Project Management Institute Practice Standard for Work Breakdown
Structures,” Exposure draft version, 2000, Published by Project Management Institute,Inc., p.
15-16.

7.6 Test for Completeness of Decomposition of Activities


Preparing an appropriate WBS is of critical importance in planning the project.
The project manager should ensure that no unnecessary activity is included in
the WBS and that all the activities that are necessary to meet the ultimate project
goals are included.
The decomposition of the project activities should be continued till all the lower
level project activities fulfill the following conditions.
1. The activity must be measurable
2. It must have clearly defined start/end events
3. It must have a clear deliverable
4. The time/cost of the activity must be measurable
5. The duration of the activity must be in acceptable limits
6. The activity must be independent
If any activity does not satisfy all the six conditions, it should be further
decomposed. The criteria for completeness are discussed in greater detail below.
37
Project Planning and Control

7.6.1 Measurable
The project manager can ask for the current status of an activity anytime during
the project. So, the status of the activity should be easy to measure. Let us
assume the transportation activity in a building construction project takes 15
days, if 5 trucks are engaged. Assuming that the trucks are at equal capacity, the
extent of completion of the activity can be measured at any point of time. The
measure of the activity’s completion is the proportion of the work completed for
a given time period.

7.6.2 Bounded
Each activity should have clearly distinguishable start and end events. Once the
start event has occurred, the project manager assumes that the activity has begun.
The deliverable should result once the last event occurs. For example, the
printing activity of a book starts when papers are loaded into the printing
machine and it is completed once all the printed papers are collected. If the
activity is not properly bounded, then the activity has to be further decomposed.

7.6.3 Deliverable
Every activity, on completion, should produce a result or outcome. The
deliverable is a visible proof of the completion of an activity. The outcome could
be a document, or a physical product. The next activity can be started only when
the predecessor activity produces the desired outcome.

7.6.4 Simplicity in Estimating Cost/Time


Every activity in a WBS should have an estimated time and cost of completion.
By dividing the activities into lower level activities, a project manager can arrive
at reasonably accurate cost and time estimates for all the activities listed in the
WBS. If it is difficult to estimate the cost/ time of an activity, it should be further
broken down.

7.6.5 Acceptable Duration Limit


In general, the duration of an activity is kept less than two weeks. Even for big
projects, the activities are decomposed further till each activity has an acceptable
duration. In the case of repetitive operations, further decomposition of activities
is not required. For example, if we want to produce 1000 units and it requires a
time period of 10 weeks, the activity need not be further broken down into five
activities with each activity producing 200 units. But long durations for activities
is not recommended, as a delay in that activity can seriously disturb the entire
project schedule.

7.6.6 Activity Independence


Each activity in the project should be independent. Once the work on an activity
begins, it should be amenable to being continued till completion, without need
for additional inputs and information. However, an activity can be scheduled in
parts on the basis of resource availability.

38
Identifying Project Activities

The WBS is decomposed to such a level that the lower level activities should
allow for the effective planning, control, and performance measurement. In order
to plan for adequate resources, the project manager examines the following
details:

 Is all the work planned for an activity capable of producing the required
deliverable?
 Is it practically feasible to manage the individual work assignments with the
WBS structure?
 What kind of an approach is to be adopted for identifying project activities: a
top-down approach or a bottom-up approach?
 How will work be assigned to an individual and controlled to receive the
required deliverables?
 How will the budgets be allocated for each project activity? How are the
budgets proposed for the increments of work?
 How will the status of the project work activity be determined?

Check Your Progress


15. Decomposition of the project activities should be continued till all the lower
level project activities fulfill certain conditions. Some of these conditions
are:
i. The activity must be measurable.
ii. The activity must be dependent on the other activities.
iii. The activity must have a clear deliverable.
iv. The duration of the activity must be within acceptable limits.
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
16. Which of the following statements is true regarding the top-down and
bottom-up approaches of developing a work breakdown structure (WBS)?
a. Activities are clearly defined in the bottom-up approach.
b. In the top-down approach, the project goal level is decomposed to lower
levels until the project manager and his/her team are satisfied that the
work has been sufficiently well defined.
c. Team approach and sub-team approach are variations in the bottom-up
approach.
d. All of the above

39
Project Planning and Control

7.7 Approaches to Defining Deliverables in the WBS


There are several approaches to defining the deliverables and building the WBS
for a project. The three main types of approaches are noun-type approaches,
verb-type approaches and organizational approaches.

7.7.1 Noun-type Approaches


There are two types of noun type approaches used in developing a WBS. They
are i) physical decomposition, and ii) functional decomposition.

Physical Decomposition
In this approach, the deliverables of the project work are defined in terms of
physical components that make up the deliverable. For example, in a project for
manufacturing a lathe machine, the project will involve the manufacture of
physical components like gears, gear belts, motor, machine base, fixtures,
supporting blocks, shafts, cutting tools and dimension scales. All these
components are to be produced to make the end product and the WBS will
represent the manufacture of all the above physical components. The project
manager can use Gantt charts that depict the duration of each activity as
rectangular bars. The length of the rectangular bar represents the duration of
each project activity and these are arranged in proper sequence.

Functional Decomposition
In the functional noun-type approach, the same cutting machine project is built
on the functional requirements of the machine like manufacturing of gear
system, conveyor system, motor system, work piece rotating system and
dimension checking system. The WBS lists the functions to be performed to
produce the end product.

7.7.2 Verb-type Approaches


The verb-type approach defines the project deliverables in terms of the actions to
be performed to produce them. The ‘design-build-test-implement’ approach and
‘objectives’ approach are the two types of verb- type approaches.

Design-Build-Test-Implement Approach
Assume a project that has to produce an innovative cutting machine. Here, all the
features that are to be added to the current cutting machine are designed, built,
tested and then implemented. Gantt charts are drawn that have lengths
corresponding to the duration of each design, build, test and implement stage of
the project.

Objectives Approach
The project manager reports completion of project activity on the basis of
attainment of some project objectives. The objective approach is similar to the
design-build-test-implementation approach and is used when progress reports are

40
Identifying Project Activities

to be prepared at various stages of the project. Clear-cut objectives are set for
each activity and the progress in meeting these objectives is measured. But
setting objectives and measuring their completion levels is difficult.

7.7.3 Organizational Approaches


Organizational approaches define project deliverables in terms of organizational
units. Geographical, departmental, and business functional approaches are the
important organizational approaches.

Geographical Approach
If the project is dispersed geographically, then the project work is partitioned
geographically. For example, a National Highway construction project requires
construction activity at different locations simultaneously. So, the project is
divided according to locations and any of the noun or verb- type approaches is
used at each location.

Departmental Approach
In the departmental approach, the project work is first divided department wise.
Any other approach can be used later in each department. Complex projects
undertaken by a single firm usually follow the departmental approach at the
earlier stages. Resource allocation becomes simpler this way, as each
department will take care of the work assigned to it.

Business Functional Approach


According to this approach, the project work is divided based on business
functional areas. The project work is divided into several business processes and
an appropriate approach is followed for each process later. This approach has
same uses that of departmental approach, but the difficulty in this process lies in
integrating all the deliverables from various processes.

Activity: The management of Midwest Automobiles Ltd., decided to launch a


bike with tubeless tyres and disk brakes on both front and rear wheels, which
ensured more safety. The concept was developed by the firm’s R&D
department. The management appointed Gauri Prasad as the project manager.
As part of his planning, Prasad wanted to define the deliverables of the
project by developing the work breakdown structure of the project. What are
the different types of approaches that Prasad can use to build a WBS?
Answer:

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Project Planning and Control

7.8 Representing the WBS


Work Breakdown Structures can be represented in different ways. Whatever the
structure type, the project goal that states the purpose of the project has to be
written at the top. Then it is divided into various activities, called Level 1
activities. The activities that do not satisfy the test for completeness are further
divided into several activities again and they are called Level 2 activities. The
process is continued till all the activities satisfy the six criteria for completion,
described earlier.
Whatever is the type used for representation, the main issue in representing the
WBS is to know whether the work required to achieve the desired outcome and
meet the project objectives has been captured in enough detail to identify the
resources, assign the responsibilities, and set the activities in sequence.

Example: WBS for a Telecom Project


1.0 CONCEPT/FEASIBILITY
1.1 Develop Concept/Marketing Plan
1.2 Conduct Market Analysis
1.3 Conduct Technical Analysis
1.4 Develop Prototype
1.5 Prepare Product Development Plan/ Cost/ Schedule
2.0 REQUIREMENTS
2.1 Develop End-User Requirements
2.2 Develop Application Requirements
2.3 Develop Infrastructure (Systems) Requirements
2.4 Develop Operations /Maintenance Requirements
2.5 Develop Service Requirements
3.0 DECISION
3.1 Present Prototype
3.2 Present Financial Statements & Time Schedule
3.3 Present Technical Capabilities
3.4 Obtain Financial Commitment
3.5 Go/ No-Go Decision (Milestone)
4.0 DEVELOPMENT
4.1 Develop End-User Systems
4.2 Develop Application
4.3 Develop Infrastructure Systems and Network

42
Identifying Project Activities

4.4 Develop Operations/Maintenance Structure


4.5 Develop Service Plan
5.0 TEST
5.1 Develop Test Plans for Each Aspect/ Element
5.2 Conduct Tests
5.3 Validate Results
5.4 Perform Corrective Action (as necessary)
5.5 Conduct Retesting
5.6 Revalidate Results
6.0 DEPLOY
6.1 Conduct a Trial Test
6.2 Conduct First Live Test
6.3 Complete Deployment
7.0 LIFE CYCLE
7.1 Conduct Customer Training & Education
7.2 Obtain Customer Acceptance
7.3 Perform Support & Maintenance
Adapted from “Project Management Institute Practice Standard for Work Breakdown
Structures,” Exposure draft version, 2000, Published by Project Management Institute,Inc.,
p.69-70.

Check Your Progress


17. Identify the approach which is not used to define the deliverables and build
the work breakdown structure for a project.
a. Noun-type approach
b. Verb-type approach
c. Dividend capitalization approach
d. Organizational approach
18. From the following, identify the verb-type approaches that are used to
define project deliverables.
i. The objectives approach
ii. The departmental approach
iii. The business functional approach
iv. The design-build-test-implement approach
a. Only i and ii
b. Only i and iv
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Project Planning and Control

c. Only ii and iii


d. Only iii and iv
19. Physical decomposition and functional decomposition are used to develop a
work breakdown structure. These are
a. noun-type approaches
b. verb-type approaches
c. organizational approaches
d. None of the above
20. All of these are organizational approaches used to define project
deliverables except
a. the business functional approach.
b. the functional decomposition approach.
c. the geographical approach.
d. the departmental approach.
21. Identify the approach that is used to define the project deliverables in terms
of the actions to be performed to produce them.
a. Noun-type approach
b. Verb-type approach
c. Organizational approach
d. Departmental approach
22. SafeQuip is a two-wheeler manufacturing company, specializing in the
manufacture of environment-friendly vehicles. The company has taken up a
project to manufacture an environment-friendly car. The project manager of
the company has developed a work breakdown structure that represents the
manufacture of components like internal combustion engine, braking
system, battery, gear box, doors, tires, etc. All these components have to be
manufactured in order to make the car. Which of the following approaches
has the project manager used to define the project deliverable?
a. The business functional approach
b. The physical decomposition approach
c. The functional decomposition approach
d. The design-build-test-implement approach
23. In which of the following approaches are the deliverables of the project
defined in terms of the components that make them up?
a. The business functional approach
b. The departmental approach
c. The physical decomposition approach
d. The functional decomposition approach

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Identifying Project Activities

7.9 Summary
 An activity is an element of work performed during the course of a project. A
project involves a number of interrelated activities.
 Activities generally, share the following characteristics – each activity is of a
definite duration; each activity uses resources such as people, materials or
facilities; and each activity has a cost associated with it.
 The Project Management Body of Knowledge defines work breakdown
structure (WBS) as a deliverable-oriented grouping of project activities that
organizes and defines the total scope of the project.
 A deliverable is any measurable, tangible, verifiable outcome or result that must
be produced to complete a project or part of a project.
 The WBS helps the project manager to ensure that the project includes all the
activities needed, and that the project includes no unnecessary activity. The
process of developing a WBS can be top-down or bottom-up approach.
 The criteria for completeness of decomposition of activities are that an activity
should be measurable, bounded, deliverable, simple in estimating cost and time,
should have an acceptable duration limit, and be independent.
 There are several approaches to defining the deliverables and building the WBS
for a project. The three main types of approaches are: noun-type approaches,
verb-type approaches, and organizational approaches.
 WBSs can be represented in different ways. Whatever the type of
representation, the main issue in representing the WBS is to know whether the
work required to achieve the desired outcome and meet the project objectives
has been captured in enough detail to identify the resources, assign the
responsibilities, and set the activities in sequence.

7.10 Glossary
 Activity Definition: Identifying the specific activities that must be performed in
order to produce the various project deliverables.
 Deliverable: Any measurable, tangible, verifiable outcome, or result that must
be produced to complete a project.
 Work Breakdown Structure: A deliverable-oriented grouping of project
activities that organizes and defines the total scope of the project.

7.11 Self-Assessment Exercises


1. A project involves a number of interrelated activities. Define an activity.
2. Identifying project activities is an important step in the project planning
phase, which can be done with the help of a work breakdown structure
(WBS). Define a WBS. What factors should be considered while designing
a WBS? How is a WBS useful for a project manager?
3. The process of developing a WBS can be top-down or bottom-up approach.
Explain these approaches in detail. What are the various ways in which a
WBS can be represented?

45
Project Planning and Control

4. While preparing a WBS, it is important that the project manager should


ensure that no unnecessary activity is included in the WBS, and that all the
necessary ones are included. How can the project manager ensure that all the
activities are decomposed completely?
5. There are several approaches to defining the deliverables and building the
WBS for a project. What are these approaches? Describe them in detail.

7.12 Suggested Reading/Reference Material


1. Prasanna Chandra, “Projects,” McGraw Hill, Seventh Edition, 2009.
2. Robert K. Wysocki, “Effective Project Management: Traditional, Agile,
Extreme,” Wiley India, 2009.
3. Jack R. Meredith and Samuel J. Mantel Jr., “Project Management: A
Managerial Approach,” Sixth Edition, Wiley India, 2008.
4. Harold Kerzner, “Project Management-A Systems Approach to Planning,
Scheduling and Controlling,” Second Edition, 2006.
5. “A Guide to the Project Management Body of Knowledge,” Project
Management Institute, Second Edition, December 2000.
6. Joseph Weiss and Robert K. Wysocki, “Five-phase Project Management: A
Practical Planning and Implementation Guide,” Basic Books, 1992.

7.13 Answers to Check Your Progress Questions


Following are the answers to the Check Your Progress questions given in the
Unit.
1. (a) WBS is a useful method of schedule development for the project
manager
WBS is a useful tool for the project manager in identifying the project
activities, and not for schedule development. It lists the
vendors/subcontractors associated with specific activities of the project. It
also illustrates how each activity of the project contributes to the whole
project in terms of budget, schedule, and performance. A WBS is initially
developed with the limited data available and is subsequently revised when
additional information is received.

2. (b) Decomposition
The breaking down of work into a hierarchy of activities and tasks is called
decomposition. Crashing refers to decreasing the total project duration after
analyzing a number of alternatives to determine how to get the maximum
duration compression for the least cost. In fast tracking, the project
manager attempts to reduce the project duration by doing project activities
in parallel. Solicitation is the process of gathering information in the form
of bids, quotations, and proposals from qualified vendors to satisfy the
project needs.

46
Identifying Project Activities

3. (d) Identifying project activities


Identifying project activities is the step in the project planning phase that
immediately follows the defining of the project scope statement. After a
pool of project ideas has been generated, the project manager screens the
ideas. Once the project ideas have been screened, they are evaluated for
marketability and technical and financial feasibility. After all these stages, a
project idea is chosen for implementation from the available alternative
project ideas.

4. (b) Work breakdown structure


The work breakdown structure (WBS) acts as a planning tool. It provides a
series of activities to be performed to complete the project. It helps the
project manager to estimate the resources required and build a schedule for
the whole project. The WBS can also be used as a tool to report the status of
the project. Completion of lower level activities implies the completion of
the corresponding activity at one level above. Completion of some higher
level activities indicates completion of project milestone events and these
are reported to the top management and the project client. The critical path
method, program evaluation and review technique, and graphical evaluation
and review technique are used by the project manager to develop schedules.
5. (d) Activity
An activity is an element of work performed during the course of a project.
An event is a time-oriented reference point that signifies the start or end of
an activity. It is also called a node. Slack is the difference between the
latest event time and earliest event time.

6. (c) Only ii and iv


An activity is an element of work performed during the course of a project.
A project involves a number of interrelated activities. Each activity is of a
definite duration. Each activity uses resources such as people, materials, or
facilities. Each activity has a cost associated with it.
7. (b) a predecessor activity.
A project consists of a series of activities. An activity that must be
completed immediately before the start of another activity is called a
predecessor activity. An activity that immediately succeeds another activity
and which cannot be started until the earlier one has been completed is
called a successor activity. Two activities which are taken up at the same
time are called concurrent activities.

8. (b) Only i and iii


The work breakdown structure (WBS) is a deliverable-oriented grouping of
project activities that organizes and defines the total scope of the project. It
helps the project manager ensure that the project includes all the activities

47
Project Planning and Control

needed and excludes any unnecessary activity. Activity sequencing is the


process of identifying and documenting interdependency relationships.
Activity definition involves identifying specific activities that must be
performed in order to produce project deliverables.
9. (b) Activity definition
Activity definition involves identifying specific activities that must be
performed in order to produce project deliverables. Scope planning is the
process of developing a scope statement as a basis for all the future
decisions to be taken on the project. Scope definition involves grouping all
major project outputs into more manageable components so as to improve
the accuracy of cost, time, and resource estimations; defining a standard for
measuring performance; and controlling and assigning responsibilities.
Activity sequencing is the process of identifying and documenting
interdependency relationships.
10. (c) its decomposed activities at level n+1 are completed.
An activity at level n is said to be completed when its decomposed
activities at level n+1 are completed. That is, an activity at level 0 is said to
be completed only when an activity at level 1 is completed.
11. (b) The activities should be decomposed from lower levels to higher
levels.
The project manager should consider the following factors while designing a
WBS – the WBS should produce a single tangible deliverable; each activity
should be unique and distinct from other activities of the project; the
activities should be decomposed logically from higher levels to lower levels;
there should be some flexibility in the WBS development process, etc.
12. (b) an activity that immediately follows another activity and which
cannot be started until the earlier one has been completed.
A project consists of a series of activities. An activity that immediately
succeeds another activity and which cannot be started until the earlier one
has been completed is called a successor activity. An activity that must be
completed immediately before the start of another activity is called a
predecessor activity. Two activities which are taken up at the same time are
called concurrent activities.
13. (d) Only ii, iii, and iv
The decomposition process makes it easy for the project manager to
estimate the duration of the activity, the resources required, and the costs
likely to be incurred. Schedule development is concerned with determining
a realistic start and finish time for project activities. Some of the methods
used for schedule development are: critical path method, program
evaluation and review technique, and graphical evaluation and review
technique.

48
Identifying Project Activities

14. (c) concurrent


A project consists of a series of activities. Two activities which are taken
up at the same time are called concurrent activities. An activity that must be
completed immediately before the start of another activity is called a
predecessor activity. An activity that immediately succeeds another activity
and which cannot be started until the earlier one has been completed is
called a successor activity.
15. (b) Only i, iii, and iv
The decomposition of the project activities should be continued till all the
lower level project activities fulfill the following conditions – the activity
must be measurable; the activity should have a clearly defined start/end
events; the activity must have a clear deliverable; the time/cost of the
activity must be measurable; the duration of the activity must be in
acceptable limits; and the activity must be independent.

16. (d) In the top-down approach, the project goal level is decomposed to
lower levels until the project manager and his/her team are satisfied
that the work has been sufficiently well defined.
In the top-down approach of developing a WBS, the project goal level is
decomposed to lower levels until the project manager and his/her team are
satisfied that the work has been sufficiently well defined. The
decomposition is continued till the activities of the lower level satisfy the
test of completeness. Activities are not properly defined in the bottom-up
approach. The team approach and sub-team approach are variations in the
bottom-up approach.

17. (c) Dividend capitalization approach


There are three main approaches that are used to define the deliverables and
build the work breakdown structure for a project. These are the noun-type
approach, the verb-type approach, and the organizational approach. The
dividend capitalization approach is used for calculating the cost of external
equity.

18. (b) Only i and iv


The verb-type approach defines the project deliverables in terms of the
actions to be performed to produce them. The design-build-test-implement
approach and the objectives approach are the two types of verb-type
approaches. The departmental approach and business functional approach
are types of organizational approaches.

19. (a) noun-type approaches


Physical decomposition and functional decomposition are noun-type
approaches used in developing a work breakdown structure. In the physical
decomposition approach, the deliverables of the project work are defined in

49
Project Planning and Control

terms of the physical components that make them up. In functional


decomposition, the deliverables of the project work are defined in terms of
the functions that are required to be performed to produce the end product.
20. (b) the functional decomposition approach.
Organizational approaches define project deliverables in terms of
organizational units. Geographical, departmental, and business functional
approaches are organizational approaches. The functional decomposition
approach is a noun-type approach.

21. (b) Verb-type approach


The verb-type approach defines the project deliverables in terms of the
actions to be performed to produce them. The design-build-test-implement
approach and the objectives approach are verb-type approaches. The
departmental approach is a type of organizational approach. In this
approach, the project work is first divided department-wise. Any other
approach can be used later in each department. Complex projects
undertaken by a single firm usually follow the departmental approach at the
earlier stages. Resource allocation becomes simpler this way, as each
department will take care of the work assigned to it.

22. (b) The physical decomposition approach


The project manager of SafeQuip has developed the work breakdown
structure by defining the components used to create the deliverable. This
approach of defining the deliverables of the project work in terms of
physical components that make up the deliverable is called as the physical
decomposition approach. According to the business functional approach,
the project work is divided based on business functional areas. In functional
decomposition, the deliverables of the project work are defined in terms of
the functions that are required to be performed to produce the end product.
In the design-build-test-implement approach, all the features that are to be
added to the project deliverable are designed, built, tested, and then
implemented.

23. (c) Physical decomposition approach


In the physical decomposition approach, the deliverables of the project
work are defined in terms of the physical components that make them up.
According to the business functional approach, the project work is divided
based on business functional areas. In the departmental approach, the
project work is first divided department-wise  later any other approach
can be used in each department. In functional decomposition, the
deliverables of the project work are defined in terms of the functions that
are required to be performed to produce the end product.

50
Unit 8
Activities: Sequencing, Estimating Duration, and Scheduling
Structure
8.1 Introduction
8.2 Objectives
8.3 Fundamentals of Project Network Diagrams
8.4 Activity Sequencing
8.5 Activity Duration
8.6 Schedule Development
8.7 Techniques for Schedule Development
8.8 Schedule Control
8.9 Summary
8.10 Glossary
8.11 Self-Assessment Exercises
8.12 Suggested Reading/Reference Material
8.13 Answers to Check Your Progress Questions
8.14 Answers to Exercises

8.1 Introduction
In the previous unit, we have discussed how to identify the project activities. In
this unit, we will discuss how to sequence activities, estimate their duration, and
schedule them. After the project activities are identified, they are represented in a
project network diagram. The project manager sequences the project activities,
estimates the duration and then schedules the activities. The project manager
sequences the project activities by understanding the dependencies among them.
He prepares the duration estimates of each project activity with the help of
duration estimates from other projects, historical information, expert advice, etc.
The project manager schedules the project activities to estimate the start and
finish dates of each project activity, to arrive at the duration of the project. He
can take help from two important techniques: Program Evaluation and Review
Technique (PERT) and Critical Path Method (CPM) to schedule the project.
Schedule control deals with the study of factors that influence and change the
project schedules. It aims at managing changes to complete the project within the
estimated schedule.
This unit will deal with the fundamentals of the project network diagram. We
will discuss activity sequencing and activity duration. We shall then move on to
discuss schedule development and the various techniques for schedule
development. Finally, we would be discussing schedule control.
Project Planning and Control

8.2 Objectives
By the end of this unit, students should be able to:

 understand the fundamentals of project network diagram.


 define activity sequencing and activity duration.
 know about the techniques for schedule development.
 define schedule control.

8.3 Fundamentals of Project Network Diagrams


According to the Project Management Body of Knowledge (PMBOK), a project
network diagram is a schematic representation of the project activities and the
logical relationships (dependencies) among them. The diagram helps the project
manager in sequencing, scheduling and controlling the project. It represents all
the project activities, the sequence in which they have to be performed, the
duration of each activity, the interdependencies among various activities and the
criticality (significance) of each activity.
The project network diagram helps the project manager in project planning by
detailing the project activities, estimating the required resources, and displaying
the inter-relationships among activities. The diagram helps to determine the start
and end dates of each activity during scheduling and it also provides insights into
possible trade-offs while controlling the project.
A good project network diagram should answer the following questions:
1. What is the estimated completion time of a project?
2. How does a delay in an activity affect the expected completion time?
3. How can the expected completion time of a project be reduced, if additional
resources are available?

8.3.1 Activity and Node


The project network diagram is represented by a series of activities and nodes.
An activity is a specific task or operation required to do a project. It is depicted
by an arrow. A node (also called an event), is a time oriented reference point that
signifies the start or end of an activity. It is represented by a circle.
The difference between an activity and a node is that the activity represents the
passage of time and the nodes are points in time that denote the starting or
ending of a specific activity. In the diagram, activity A is represented with i and j
as the starting and ending nodes. The activity can also be written as i –j. Event i
is called the tail event and event j is called the head event.
Dummy activity: An activity of zero duration that is used to represent the
logical relationship in the network diagram is called a dummy activity. Dummy
activities do not consume any resources, but are used to maintain the proper
precedence relationship between the activities that are not connected by the
nodes. It is represented by a dashed line headed by an arrow.

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Activities: Sequencing, Estimating Duration, and Scheduling

For example, in a project, A and B are concurrent activities. Activity C is


dependent on A and activity D is dependent on both A and B. Then the project
manager uses a dummy activity X to represent the relationship between activity
A and activity D.

8.3.2 Dependencies in the Project Network Diagram


A dependency is a relationship that exists between a pair of activities. There are
four types of activity dependencies that describe the relationship between any
pair of activities. They are finish to start, start to start, start to finish and finish to
finish.

Finish to Start
Finish to start dependency states that activity A must be completed before
activity B can begin. If activity A is obtaining raw material and activity B is
inspecting the raw material, then activity B can be performed only after the
completion of activity A. Therefore, the dependency is finish to start.

Start to Start
Start to start dependency states that activity B can be started only if activity A
has begun. This can be explained with the help of the previous example – that is
the inspection activity can be started and continued once the raw materials start
coming. Subsequently, both activities go on in parallel.

Start to Finish
Start to finish dependency states that activity B must start before activity A can
finish. For example, if a firm wants to develop a new information system to
replace the existing one, the firm has to confirm that the new system is well
operating. When the new system starts to work (activity B), the existing system
can be discontinued (activity A).

Finish to Finish
Finish to finish dependency states that activity A must finish before activity B
finishes. For example, data feed operation (activity B) cannot be finished until
the collection of data (activity A) is completed.

53
Project Planning and Control

Activity: John Robertson, the project manager-in-charge of construction of


a hospital, identified the following project activities: selecting the
administrative staff, selecting the site, selecting the equipment, designing a
layout, bringing them to the site, recruiting the medical staff and other
support staff, purchasing medical equipment, constructing the hospital,
installing the equipment, developing an information system and training the
support staff to use it. To construct a project network diagram, Robertson
needs to know the dependencies among various activities of the project.
What is a dependency? What are the different types of dependencies?
Explain the dependencies among various activities of the project.
Answer:

Check Your Progress


1. In a certain project, collection of data is an activity and the entry of data into
an information system is another activity. The activity of data entry cannot
end until the collection of data is completed. This is an example of
a. finish to start dependency.
b. start to finish dependency.
c. finish to finish dependency.
d. start to start.
2. A dummy activity in a project network diagram represents the
_____________ in the network diagram.
a. necessary time delays
b. logical relationship
c. allocation of resources
d. crashing of an activity
3. Given here is a list of activities that have to be carried out after the project
activities have been identified. Identify the correct sequence of these
activities.
i. The project manager schedules the project activities to estimate the start
and finish dates of each project activity to arrive at the duration of the
project.
ii. The project manager prepares duration estimates of each project activity
with the help of duration estimates from other projects, historical
information, expert advice, etc.

54
Activities: Sequencing, Estimating Duration, and Scheduling

iii. The project manager sequences the project activities by understanding


the dependencies among them.
a. ii-i-iii
b. i-iii-ii
c. iii-ii-i
d. iii-i-ii
4. Which of the following is a schematic representation of project activities
and the logical relationships or dependencies among them?
a. Control chart
b. Project network diagram
c. Work breakdown structure
d. None of the above
5. ___________ is a specific task or operation required to do a project.
a. Event
b. Node
c. Slack
d. Activity
6. An activity can also be represented as ‘i-j’. ‘i’ is called the ____________
and ‘j’ is called as the ______________.
a. tail event, head event
b. head event, tail event
c. head event, dummy activity
d. dummy activity, tail event
7. A dummy activity is one that has
a. zero duration.
b. the lowest duration.
c. the highest duration.
d. None of the above
8. In a project network diagram, j denotes
a. the starting node.
b. an activity.
c. the ending node.
d. Both (a) and (c)
9. In a project network diagram, a node is
a. a time-oriented reference point that signifies the start or end of an
activity.
b. represented by an arrow.
c. a specific task or operation required to do a project.
d. also called as a float.

55
Project Planning and Control

10. Which of the following statements correctly differentiates between an


activity and a node?
a. An activity is represented by a circle while a node is represented by an
arrow.
b. An activity represents the passage of time while the nodes are points in
time that denote the starting or ending of a specific activity.
c. An activity is a time-oriented reference point that signifies the start and
end of a node while a node is an element of work performed during the
course of a project.
d. All of the above
11. Consider two activities – A and B. Start to start dependency between these
two activities states that
a. Activity B must start before activity A can finish.
b. Activity A must finish before activity B finishes.
c. Activity B can be started only if activity A has begun.
d. Activity A should be completed before activity B can begin.
12. Activity B must start before activity A can finish. This is called
a. start to start dependency
b. start to finish dependency
c. finish to finish dependency
d. finish to start dependency
13. Identify the statements that are true regarding a dummy activity.
i. A dummy activity is an activity of zero duration that is used to
represent the logical relationship in the network diagram.
ii. Dummy activities do not consume any resources.
iii. Dummy activities are used to maintain the proper precedence
relationship between the activities that are not connected by the nodes.
iv. Dummy activities are represented by circles in a project network
diagram.
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
14. Identify the statement that is not true regarding a project network diagram.
a. A project network diagram is a schematic representation of the project
activities and the logical relationships among them.
b. The project network diagram helps the project manager in sequencing,
scheduling, and controlling the project, but does not explain how a
delay in an activity affects the expected completion time.

56
Activities: Sequencing, Estimating Duration, and Scheduling

c. The project network diagram represents all the project activities, the
sequence in which they have to be performed, the duration of each
activity, the interdependencies among various activities, and the
criticality of each activity.
d. The project network diagram helps to determine the start and end dates
of each activity during scheduling, but does not provide insights into the
possible trade-offs while controlling the project.
15. In a project, activity A should be completed before activity B can begin.
This is called
a. finish to start dependency.
b. start to finish dependency.
c. finish to finish dependency.
d. start to start.
16. In a project network diagram, a node is also called a/an _________.
a. activity
b. event
c. slack
d. None of the above

8.4 Activity Sequencing


Once the project activities are identified using the work breakdown structure, the
project manager prepares an activity list of the project. He puts all the activities
down in a logical sequence to arrive at the project end-product. Several project
management software packages like Project 2000 provide sequencing of
activities to achieve the project end product. While sequencing the activities, the
project manager has to study various aspects such as the description of the end
product, mandatory and discretionary dependencies among the activities,
external dependencies, other constraints and assumptions of the project.
While analyzing the product description, the project manager has to consider the
physical characteristics of the product and the logical sequencing of the activities
to achieve the end product. The product description is generally less detailed in
early phases of the project and it is progressively elaborated later.
The project manager analyzes the mandatory and discretionary dependencies
among the various project activities. Mandatory dependencies are those that are
inherent in the nature of project. Here, the dependency between activities is
certain. For example, new machinery is erected only when the layout has been
finalized. Mandatory dependency is also called as ‘hard logic’. Therefore the
dependency among the activities is mandatory. Discretionary dependencies are
those dependencies of the project that are defined by the project team.
Discretionary dependencies are defined by the knowledge of the best practices
and the standard procedures followed for certain activities in the project. This
dependency is also called as ‘soft logic’ or ‘preferred logic.’

57
Project Planning and Control

The project manager also has to analyze the dependencies among project
activities with external activities. For example, voter identity cards should be
distributed before the elections. Therefore, the activity of holding elections is
dependent on the distribution activity. The sequencing of activities is also
affected by several other constraints and assumptions made by the project
manager regarding the project.

8.4.1 Methods of Activity Sequencing


The project manager considers all the above issues to sequence the project
activities. The project manager sequences all the project activities in an
appropriate manner and represents them in the project network diagram. Some of
the methods of activity sequencing are given below. Figure 8.1 represents the
various activity relationships in ADM and PDM methods.

Figure 8.1: Activity Relationships in ADM and PDM Methods

Arrow Diagram Method (ADM)


In this method, the network diagram is constructed using arrows to represent the
activities and connecting them at nodes to show the dependencies. This method
uses finish-to-start dependencies only to explain the logical relationships. This
method is also called as Activity-On-Arrow (AOA) method.

Precedence Diagram Method (PDM)


In this method, the network diagram is constructed using nodes to represent the
activities and connecting them with arrows to represent the dependencies. This
method uses all four types of dependencies. This method is also called as
Activity-On-Node (AON) method.

Conditional Diagramming Methods


The project manager also uses conditional diagramming methods like GERT
(Graphical Evaluation and Review Technique) and system dynamics that
represent non-sequential activities like loops (where activities are repeated again

58
Activities: Sequencing, Estimating Duration, and Scheduling

and again) or conditional branches (e.g. a design update is required only when
errors are found in the inspection). PDM and ADM cannot represent loops and
conditional branches.

Activity: The project of installing milling machines involves activities A, B,


C and D. Raghavendra, the project manager, identifies the relationship among
the activities: activities B and C cannot begin until activity A has been
completed; activity D cannot begin until activities B and C have been
completed. How can he represent these relationships in a project network
diagram using the Arrow Diagram Method (ADM) and Precedence Diagram
Method (PDM)?
Answer:

Check Your Progress


17. In a certain project, activity B and activity C cannot begin until activity A
has been completed. How is this activity relationship represented using the
activity-on-arrow method of activity sequencing?

a.

b.

c.

d.

18. Discretionary dependencies are


i. Those dependencies among project activities that are inherent in the
nature of the project.
ii. Those dependencies among project activities that are defined by the
project team.

59
Project Planning and Control

iii. Those dependencies among project activities that are certain or


mandatory.
iv. Also called preferred logic.
a. Only i and ii
b. Only i and iii
c. Only ii and iv
d. Only iii and iv
19. Which of the following aspects should the project manager consider while
analyzing the product description?
i. The physical characteristics of the product
ii. The dependencies among the various project activities
iii. The logical sequencing of the activities to achieve the end product
iv. The dependencies among the project activities with external activities
a. Only i and iii
b. Only i and iv
c. Only ii and iii
d. Only iii and iv
20. Which conditional diagramming method represents non-sequential activities
like loops and conditional branches to sequence project activities?
a. The Arrow Diagram Method (ADM)
b. The Precedence Diagram Method (PDM)
c. The Graphical Evaluation and Review Technique (GERT)
d. All of the above
21. The arrow diagram method
a. is also called activity-on-node method.
b. makes use of all the four types of dependencies.
c. involves constructing the network diagram using arrows to represent
activities and connecting them at nodes to show the dependencies.
d. involves constructing the network diagram using nodes to represent the
activities and connecting them with arrows to represent the
dependencies.
22. ___________ are dependencies that are inherent in the nature of the project.
a. Preferred logic
b. Mandatory dependencies
c. Discretionary dependencies
d. Both (a) and (b)
23. Which of the following statements are true regarding the precedence
diagram method used to sequence activities?
i. The precedence diagram method is also called activity-on-arrow
method.

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Activities: Sequencing, Estimating Duration, and Scheduling

ii. The network diagram is constructed using nodes to represent the


activities and connecting them with arrows to represent the
dependencies.
iii. All the four types of dependencies – start to start, start to finish, finish
to start, and finish to finish, are used.
a. Only i and ii
b. Only i and iii
c. Only ii and iii
d. i, ii, and iii
24. From the following options, identify the methods/techniques used for
activity sequencing.
i. Arrow diagram method
ii. Critical path method
iii. Precedence diagram method
iv. Program evaluation and review technique
a. Only i and ii
b. Only i and iii
c. Only ii and iv
d. Only iii and iv
25. Which of the following aspects should the project manager keep in mind
while sequencing the activities to achieve the project’s end product?
i. Description of the end product
ii. Mandatory and discretionary dependencies among the activities
iii. External dependencies
iv. Constraints and assumptions of the project
a. Only i and ii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv

8.5 Activity Duration


After the project activities are sequenced, the project manager estimates the
duration of each activity to calculate the duration of the entire project. The
duration of an activity is the time period required to complete the activity. As it
is not possible for a person to work continuously, the project manager may
include some time allowance while estimating activity duration. He assigns these
allowances based on his experience, the difficulty involved in the activity, the
ability of the workman to execute it, etc. It is assumed that an average performer
completes an activity in the estimated duration with his normal performance.

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Project Planning and Control

The activity duration is not synonymous with work effort. Suppose an activity
takes 30 days to complete, we cannot assume that the effort is made for 30 days,
even though the activity duration is 30 days. For example, if the activity is to
consult an external expert for the given problem, the actual consultation time is
only about 3 hours, but the duration assigned for the activity will be about 30
days considering the time required to find the expert, discuss the matter and
solve the problem.
Activity duration could also be influenced by the amount of resources allocated.
Generally speaking, more the resources, the shorter the duration of the activity.
For example, if more number of people are included to work on a project, then
the project can be completed on or before time. However, it cannot be assumed
that the relationship between activity duration and resources allocated is
completely proportional. Thus, the project manager has to allocate more
resources till the crash point is arrived at. Beyond this point, it is not possible to
reduce the duration of an activity.
The actual duration of activities may vary from the estimates. Therefore, the
project manager has to see to it that there is as little deviation as possible. The
different skill levels of manpower employed, unexpected events like acts of
nature, vendor delays, power failures, or misunderstanding the nature of work
are some of the causes for variations of actual activity durations from the
estimates.

8.5.1 Methods of Estimating Activity Duration


The project manager uses the techniques given below to estimate the appropriate
duration of the project activities.

Similarity to Other Activities


Some project activities may be similar to activities in other projects. In such
cases, the estimates of activity duration can be taken from those activities. This
is normally followed in case of administration activities that are common for all
projects.

Historical Data
The actual durations of successful projects in the past can be used to estimate the
duration of the activity. Larger firms maintain an extensive database of activity
duration history that records the estimated time, actual time, reasons for time
overrun (if there was one), characteristics of the activity, the skill levels of the
people, etc. Whenever firms wish to assign duration estimations, they refer to
historical data and find the duration estimate and actual time.

Expert Advice
In case of highly technical activities, the project manager can consult a technical
expert to estimate the activity duration. He can also consider the advice of
vendors and other non-competing firms to assign the duration estimates.

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Activities: Sequencing, Estimating Duration, and Scheduling

Delphi Method
In this method, the project manager forms a group of people and asks them to
estimate the duration of an activity, after describing the nature and characteristics
of the activity. The estimates of each participant are then collected. Those
participants whose estimations are very high or very low are asked to explain the
reasons for their estimates.
The project manager then discusses with all the group members to know why
their estimates are higher or lower than estimates of the other participants. He
then asks the participants to write down new estimates of duration after the
discussion. This process continues until the entire group arrives at a particular
estimate. In general, this method is followed when expert advice is not available.
Three- Point Method
The duration of an activity may vary even when the same activity is repeated in
similar conditions. Therefore the project manager considers three types of
estimates in this method.
They are:
1. Optimistic time
2. Pessimistic time
3. Most Likely time
Optimistic time (t0)
Optimistic time is the minimum amount of time within which an activity can be
completed. It is possible to complete an activity within the optimistic time only
when the external environment is extremely favorable.
Pessimistic time (tp)
Pessimistic time is the maximum amount of time required to complete an
activity. This happens when the external environment is unfavorable.
Most Likely time(tm)
It is the time that is the best guess for an activity completion – neither optimistic
nor pessimistic.
Expected time (te)
The project manager arrives at the ‘expected time’ based on the above estimates.
The project manager calculates the estimate of duration of an activity as,

t o  4t m  t p
te 
6
The expected time of an activity cannot be more than the pessimistic time of that
activity. However, it can be more than the optimistic time. The expected time of
an activity is more than, less than, or equal to the most likely time of that
activity.

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Project Planning and Control

Wide Band Delphi Method


A combination of the Delphi method and the three point method is referred to as
the Wide Band Delphi method. In this method, the members are asked to give
an optimistic time, a pessimistic time, and the most probable time, instead of a
single estimate. Then the project manager follows the Delphi method and
determines the duration estimate.

Check Your Progress


26. Which of the following time is not included in calculating the variance of a
project?
a. Optimistic time
b. Pessimistic time
c. Most likely time
d. None of the above
27. The _______________ refers to a point beyond which it is not possible to
reduce the duration of an activity.
a. node
b. slack
c. free float
d. crash point
28. If a, b, c are the optimistic, pessimistic, and most likely times of an activity,

c  a 2
then the variance of the activity is calculated as

a.

a  c 2
36

b.

b  c 2
36

c.

b  a 2
36

d.
36
29. The duration of a project activity can be estimated by:
i. taking estimates of duration of similar activities in other projects.
ii. taking the actual durations of successful projects in the past.
iii. consulting a technical expert to estimate activity duration.
iv. forming a group of people and asking them to estimate the duration of
the activity after describing the nature and characteristics of the activity.
a. Only i, ii, and iii

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Activities: Sequencing, Estimating Duration, and Scheduling

b. Only i, iii, and iv


c. Only ii, iii, and iv
d. i, ii, iii, and iv
30. Identify the method of estimating the duration of an activity in which the
members are asked to give an optimistic time, a pessimistic time, and the
most probable time, instead a single estimate.
a. Expert advice
b. Delphi method
c. Three-point method
d. Wide Band Delphi method
31. Match the following types of estimates with their descriptions.
i. Optimistic time
ii. Pessimistic time
iii. Most likely time
p. The maximum amount of time required to complete an activity
q. The time that is the best guess for an activity completion
r. The minimum amount of time within which an activity can be
completed
a. i/q, ii/r, iii/p
b. i/r, ii/p, iii/q
c. i/q, ii/p, iii/r
d. i/r, ii/q, iii/p
32. If a, b, and c represent optimistic time, most likely time and pessimistic time
of an activity respectively, then the expected time of an activity is calculated
as
a bc
a.
6
a  4b  c
b.
6
4a  b  c
c.
6
a  b  4c
d.
6
33. Which of the following statements is not true about the expected time of an
activity?
a. It can be more than the optimistic time of that activity.
b. It can be less than the most likely time of that activity.
c. It can be more than the pessimistic time of that activity.
d. It can be more than the most likely time of that activity.

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Project Planning and Control

Exercise
A. The optimistic, pessimistic, and most likely times of an activity are 5 days,
12 days, and 7 days, respectively. Calculate the expected time of an activity.

8.6 Schedule Development


Schedule development is concerned with determining a realistic start and finish
time for project activities. It aims to match project resources like machinery,
materials and labor with project activities over time. Good scheduling eliminates
production problems, facilitates timely procurement of raw materials, and
ensures project completion on time. Otherwise, it may lead to delays in project
activity, loss of inventory and cost overruns.
The project manager should be aware of the resources and the quantity of these
resources needed at every stage of the project. He has to prepare a ‘resource pool
description’ that contains details of all the project resources and their allocation
to project activities.
The project manager prepares two types of calendars; project calendars and
resource calendars to schedule the project. Project calendars emphasize the
completion time of the project activities. Suppose it is estimated that the project
is to be completed in 7,200 hours in normal working conditions. Then schedules
are prepared based on the time estimates. The project manager assumes that 60%
of the project is accomplished, if 4,320 hours are spent on the project. Most of
the projects are scheduled based on project calendars.
Resource calendars schedule the project on the basis of the resources used. The
focus here is on scheduling and utilizing specific resources effectively. For
example, a construction project requires 1200 bags of cement. If 360 bags have
been used, the project manager can assume that 30% of the work has been done.
Here, the project manager concentrates on whether the specific resources are
being used effectively or not. Project calendars are concerned with how various
project resources are consumed over a period of time. Resource calendars deal
with how a specific resource or specific category of resources is spent over a
period of time.

8.7 Techniques for Schedule Development


The project manager can use some of the following methods for schedule
development:
1. Critical Path Method (CPM)
2. Program Evaluation and Review Technique (PERT)
3. Graphical Evaluation and Review Technique

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Activities: Sequencing, Estimating Duration, and Scheduling

These methods are used:


1. To estimate the completion time of the project
2. To find out if the project is behind, ahead of or on schedule.
3. To compare the actual resources spent with the planned resources at any
stage of the project.
4. To study activities that are critical for project completion and activities that
can be delayed without delaying project completion.
5. The project network diagram is used in schedule development.

8.7.1 Construction of a Network Diagram


Before assigning the duration estimates, the project manager sequences all the
activities and then gives numbers to all nodes.

Numbering Nodes
Step 1: Assign the starting event as ‘0’.
Step 2: Assign the next number to any unnumbered event whose predecessor
events are already numbered.
Repeat Step 2 until all events are numbered.
The basic scheduling computations of a project can be grouped under three
heads: Forward pass, backward pass, and calculation of floats.

Forward Pass
The forward pass computation finds the earliest start and earliest finish times for
each activity; or the earliest expected occurrence time for each node. The
computation starts with an assumed earliest occurrence time of zero for the
initial project event.
The earliest starting time for activity (i,j) is the earliest event time of the tail
event. i.e. ESij = Ei.
The earliest finish time for activity (i,j) is the earliest starting time plus the
activity duration, t ij

i.e, EFij = ESij + t ij

Event is just a time oriented reference point. Events will have only the earliest
time and latest time. The earliest time is obtained in the forward pass, and the
latest time is obtained in the backward pass. But every activity will have earliest
start time, earliest completion time in forward pass and latest start time and latest
finish time in backward pass.
Suppose an activity A is connected between two events i and j, and duration of
the activity is 5 units of time. Then the earliest start time of activity A is 0 and
the earliest completion time is 5. Also, the earliest time of event i is 0, and the
earliest time of event j is 5.

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Project Planning and Control

Earliest event time for event j is the maximum of earliest finish time of all
activities leading into that activity.
Ej= Maximum {Ei + t ij}.

Consider the network diagram, where three activities are leading into event ‘m.’

Here, the earliest event time at ‘m’, is the maximum of the earliest finish times
of all the activities ending into that activity.
Thus, Em is the maximum of
{(ESim + tim ), (ESjm + tjm ), and (ESkm + tkm)}

Backward Pass
The backward computation finds the latest start and completion times of each
activity without affecting the total project duration. Here the calculation starts at
the ‘end’ node and ends with the ‘first’ node. The total project duration is taken
as the latest time of the end node.

Latest finish time for activity (i,j) is the latest event time of event j. i.e., LFij = Lj
Latest starting time for activity (i,j) is the difference between the latest
completion time of (i,j) and the activity duration. i.e., LS ij = LFij – t ij

Latest event time for event i is the minimum of the latest start time of all
activities starting from that the event i.
Li = Minimum {LFij – t ij}.

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Activities: Sequencing, Estimating Duration, and Scheduling

Consider the network diagram, where three activities are beginning at the event i.
The latest event time of event i is calculated as:
Minimum of {(LFij – tij), (LFim – t im ), (LFil – til)}

Calculation of Floats
There are three types of floats. They are:
1. Total float
2. Free float
3. Independent float

Total Float
This is the amount of time by which the completion of an activity can be delayed
beyond its expected earliest completion time without affecting the overall project
duration. It is calculated as the difference between the latest start time and the
earliest start time of a project activity.
Total float= LSij – ESij
= (Lj – t ij) – ESij
= (Lj – Ei ) – t ij

Free Float
This is the amount of time by which the completion of an activity can be delayed
beyond the earliest finish time without affecting the earliest start of a subsequent
activity.
Free float= Earliest event time of event j – Earliest event time for event i –
activity time (i,j)
= (Ej – Ei ) – tij

Independent Float
This is the amount of time by which the start of an activity can be delayed
without affecting the earliest start of any activities following immediately.
Independent float= (Ej – Li ) – tij

Event Slacks
For an event, slack is the difference between the latest event time and earliest
event time. For an event i, slack = Li – Ei
For an activity (i, j), the slack of event j is called head slack, and the slack of
event i is called tail slack.
Head slack = Lj – Ej

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Project Planning and Control

Tail slack = Li – Ei
The values of free float and independent float can be expressed in terms of head
and tail slacks.
Free float = Ej – Ei – tij

= Lj – Ei - tij – (Lj – Ej)

= Total float – Head slack


Independent float = (Ej – Li ) – tij

= Ej – Ei – tij – ( Li –Ei )

= Free float – Tail slack


The Various floats and slacks of an activity (i,j) can be represented in the
following manner:

Example 8.1
Suppose a project has seven activities A, B, C, D, E, F, and G. The predecessor
activity (ies) of a particular activity and duration estimates of all project
activities are given in Table 8.1.
Table 8.1: Project Activities and Duration Estimates

Predecessor Activity Duration


A --- 6
B A 1
C --- 8
D C 5
E B, C 9
F D, E 12
G F 3

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Activities: Sequencing, Estimating Duration, and Scheduling

The network diagram for the given project activities is shown in Figure 8.2 (a).
Here, activity X is a dummy activity. Each node is assigned a certain number
that is written on the top half of the circle. The earliest completion time is
represented on the bottom left and the latest completion time on the bottom right
of the circle.

Figure 8.2 (a): Project Network Diagram

Note: X is a dummy activity


The network is depicted using the Activity-On-Arrow method.
The earliest and latest event times are to be calculated now, in order to complete
the project network diagram and fill in the Earliest Time (Ei) and Latest Time
(Li) (for each node) in Table 8.2 (a).
Let us assume that the unit of time is ‘days’.
Forward Pass Computation: To determine the Earliest Time (Ei) of each event
(node) from 0 to 6.
For Event 0, Earliest Time, E0 = 0.
Since Event 0 simply signifies the start of the project, E0 will always be 0.
(“The computation starts with an assumed earliest occurrence time of zero for
the initial project event.”)
For Event 1, E1 = 0 + 6 = 6.
Event 1 can occur as soon as Activity A is completed. Activity A starts at Event
0 and takes 6 days for completion [Refer to Table 8.1 or Figure 8.2(a)].
So, earliest occurrence of Event 1
= Earliest occurrence of Event 0 + Duration of Activity A
= E0 + 6 = 0 + 6 = 6 days.
(“Earliest event time for event j is the maximum of earliest finish time of all
activities leading into that event.”)
Using formula, this is represented as, E1 = E0 + tA = 0 + 6 = 6 days.

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Project Planning and Control

Similarly, E2 = E0 + tC = 0 + 8 = 8 days, as Event 2 can occur as soon as Activity


C is completed.
Event 3 denotes the situation that Activity E can start. For this, predecessor
activities B and C should be over (Refer Table 8.1). From the project network
diagram, this can also be viewed as the condition that activity B and dummy
activity X (which follows Activity C) should be over.
Earliest completion of Activity B = E1 + Time taken by Activity B = 6 + 1 = 7
days.
Earliest completion of Activity C = E0 + Time taken by Activity C = 0 + 8 = 8
days.
(From the project network diagram, earliest completion of dummy activity X =
E2 + 0 = 8 + 0 = 8 days.)
So, earliest event time of Event 3 = E3 = Max (7, 8) = 8 days.
(“Earliest event time for event j is the maximum of earliest finish time of all
activities leading into that event.”)
Using formula, the above calculation is represented as;
E3 = Max [(E1 + tB), (E2 + tX)] = Max [(6 + 1), (8 + 0)] = 8 days.
Similarly, E4 = Max [(E3 + tE), (E2 + tD)] = Max [(8 + 9), (8 + 5)] = 17 days.
E5 = E4 + tF = 17 + 12 = 29 days.
E6 = E5 + tG = 29 + 3 = 32 days.

Table 8.2 (a): Earliest and Latest Times

Node Earliest Time Latest Time


0 0 0
1 6 7
2 8 8
3 8 8
4 17 17
5 29 29
6 32 32

Backward Pass Computation: To determine the Latest Time (Li) of each event
(node) from 0 to 6. Here, Node 6 represents project completion. The backward
pass is done, “without affecting the total project duration.” That is, the earliest
occurrence of the last node in the network is also taken as the latest occurrence
of that node. Therefore,
L6 = E6 = 32 days.

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Activities: Sequencing, Estimating Duration, and Scheduling

Now, we work backwards from Event 6, following the two rules given below:
When a node is the starting point (tail) for only one activity (e.g., nodes 1, 3, 4,
5), the latest time for the node is the latest start time of the activity starting from
that event. This is computed as the difference between the latest event time of
the head node and the activity duration.
That is,
L5 = L6 – tG = 32 – 3 = 29
L4 = L5 – tF = 29 – 12 = 17
L3 = L4 – tE = 17 – 9 = 8
When an event (node) is the starting point of two (or more) activities, as in node
0 or node 2; the latest time for the node is the minimum of the latest start times
of the activities starting from the event. This is mathematically represented
below.
L2 = Min [(L3 – tX), (L4 - tD)] = Min [(8 - 0), (17 - 5)] = 8 days.
L1 = L3 – tB = 8 – 1 = 7 days.
L0 = Min [(L1 – tA), (L – tC)] = Min [(7 - 6), (8 - 8)] = 0 days.

Calculation of Floats:
Total float:
For activity A, the total float is,
(Li – Ej) – tij = (7 – 0) – 6 = 1.
For activity B, the total float is = (8– 6) – 1= 1.
For activity C, the total float is = (8– 0) – 8 = 0.
Similarly, total float values can be determined for all the activities.
Free float:
For activity A, the free float is,
Total float – Head slack = 1 – (7 – 6) = 0.
For activity B, the free float is, 1 – (8 – 7) = 0.
For activity C, the free float is, 0 – (8 – 8) = 0.
Similarly, free float values can be determined for all the activities.
Independent float:
For activity A, the independent float is,
Free float – Tail slack = 0 – (0 – 0) = 0.
For activity B, the free float is, 1 – (7 – 6) = 0.

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Project Planning and Control

For activity C, the free float is, 0 – (0 – 0) = 0.


Similarly, independent float values can be determined for all activities.

Table 8.2 (b): Floats of the Project Activities

Activity Duration Total Float Free Float (Total Independent Float


(Li – Ej) – tij Float – Head (Free Float – Tail
Slack) Slack)
A 6 1 0 0
B 1 1 0 0
C 8 0 0 0
X - 0 0 0
D 5 4 4 4
E 9 0 0 0
F 12 0 0 0
G 3 0 0 0

Figure 8.2 (b): Project Network Diagram

The critical path of the project is the longest path through the network. The
length of the critical path gives the shortest allowable time for the completion of
the project. This helps the project manager to concentrate and prioritize critical
activities while allocating project resources.
From Figure 8.2 (b) and Table 8.2 (b), the critical path is C – X – E – F – G
(indicated in the figure by thick arrows). Therefore, the project takes at least 32
time units (8+0+9+12+3=32) for completion.

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Activities: Sequencing, Estimating Duration, and Scheduling

Table 8.3: Floats of the Project Activities

Activity Duration Total Float Free Float Independent


(Lj-Ei)-tij (Total Float – Float (Free Float
Head Slack) – Tail Slack)
A 6 1 0 0
B 1 1 1 0
C 8 0 0 0
D 5 4 4 4
E 9 0 0 0
F 12 0 0 0
G 3 0 0 0
X - 0 0 0

Check Your Progress


34. The project manager develops the project schedule on the basis of the raw
materials consumed in a project. What type of schedule development
calendar is this?
a. Project calendar
b. Resource calendar
c. Resource pool description
d. None of the above
35. Methods like the critical path method, the program evaluation and review
technique, and the graphical evaluation and review technique are used to:
i. Estimate the completion time of the project
ii. Find out if the project is behind, ahead of, or on schedule.
iii. Compare the actual resources spent with the planned resources at any
stage of the project.
iv. Study activities that are critical for project completion and activities that
can be delayed without delaying project completion.
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
36. Match the following types of floats with their descriptions.
i. Total float
ii. Free float
iii. Independent float
p. The amount of time by which the completion of an activity can be
delayed beyond the earliest finish time without affecting the earliest
start of a subsequent activity.

75
Project Planning and Control

q. The amount of time by which the start of an activity can be delayed


without affecting the earliest start of any activities following
immediately.
r. The amount of time by which the completion of an activity can be
delayed beyond its expected earliest completion time without affecting
the overall project duration.
a. i/p, ii/r, iii/q
b. i/r, ii/p, iii/q
c. i/q, ii/r, iii/p
d. i/r, ii/q, iii/p
37. Which of the following statements is not correct for an activity in a project
network diagram?
a. Total float is the difference between the latest start time and the earliest
start time of a project activity.
b. Slack is the difference between the latest event time and earliest event
time.
c. Free float is the difference between total float and head slack.
d. Independent float is the difference between total float and tail slack.
38. Which of the following methods is not used for developing schedules?
a. The Critical Path Method
b. The Work Breakdown Structure
c. The Program Evaluation and Review Technique
d. The Graphical Evaluation and Review Technique
39. For an activity (i, j), the difference between the latest finish time and the
earliest finish time represents
a. head slack.
b. tail slack.
c. activity duration.
d. total float.
40. Identify the techniques used for scheduling the project.
i. Black box
ii. Critical path method
iii. Realized yield method
iv. Program evaluation and review technique
a. Only i and ii
b. Only i and iii
c. Only ii and iv
d. Only iii and iv

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Activities: Sequencing, Estimating Duration, and Scheduling

Exercises
B. A project network diagram has three activities – A, B, and C. All these
activities lead into event ‘x’.

The earliest start times of activities A, B and C are 3 days, 5 days, and 7
days, respectively. The duration estimates of these activities are 5 days, 7
days, and 11 days, respectively. What would be the earliest event time at X?
C. The earliest start, earliest finish, latest start and latest finish times of an
activity P are given below: The duration of activity P is 7 units. What is the
total float, free float and independent float of activity P?

D. The earliest start, earliest finish, latest start and latest finish times of an
activity A are given below: The duration of activity A is 8 units. What is the
total float of activity A?

8.7.2 Critical Path Method (CPM)


Critical Path Method is a network analysis technique used to predict the project
duration by finding out which sequence of activities (the critical path) has the
least amount of scheduling flexibility. In this method, the project manager
identifies the critical activities of the project that constitute the critical path of
the project.
Critical activities are those activities whose total float value is ‘0’. This means,
any delay in the critical activity results in a delay in the entire project to the same
extent. The project manager identifies a series of critical activities from the
beginning of the project to its completion. The series of critical activities is
called the ‘critical path’ of the project.

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Project Planning and Control

The critical path of the project is the longest path through the network. The
length of the critical path gives the shortest allowable time for the completion of
the project. This helps the project manager to concentrate and prioritize critical
activities while allocating project resources.

8.7.3 Program Evaluation and Review Technique (PERT)


The duration estimates in this technique are probabilistic. The project manager
considers optimistic, pessimistic and the most likely completion time of each
activity rather than a single estimate as in the Critical Path Method.
The project manager calculates the expected time (te) for each activity as,

t o  4t m  t p
te  ,
6
Where, to, tp , and tm are the optimistic, pessimistic and most likely completion
times of a project activity.
The methodology of PERT is explained below:
Step 1: Develop a list of project activities, and identify all their immediate
predecessors.

t o  4t m  t p
Step 2: Calculate time estimates for each activity as t e 
6
Step 3: Calculate the earliest start time and earliest finish time for each activity,
based on the expected time.
Step 4: Identify the critical path of the network taking into consideration those
activities whose total float value is ‘0’ and determine the expected project
duration.
Step 5: Calculate the standard deviation of the project. The standard deviation is
a square root value of project variance. The variance of a project activity is
calculated as (tp – to )2 / 36, and the project variance is the sum of variances of all
project activities.
Step 6: The square root value of project variance gives the standard deviation of
the project. Calculate the value of z as,
z = (Due date – Expected date of completion) / (Standard deviation of the
project).
Where, ‘z’ is the number of standard deviations the due date lies from the mean
or expected date.
Step 7: Using the standardized normal distribution table, determine the
probability of meeting a specific completion date for the obtained z value.
Step 8: Crash or compress the project to the extent possible.

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Activities: Sequencing, Estimating Duration, and Scheduling

Example 8.2
The pessimistic, most likely, and optimistic times (in number of days) of the
activities in a particular project are given below, along with the predecessor
activities. Find the probability of completing the project in 26 days.

Figure 8.3 (a): Project Network Diagram

Figure 8.3 (a) is the network diagram for the given project. The critical path of
the project is A-C-E and the expected project completion time is 24 days.

Activity Predecessor(s) to tm tp
A - 6 8 10
B A 2 3 10
C A 10 11 18
D A, B 3 4 11
E A, C 4 4 4
The expected completion time of an activity is calculated as:
t o  4t m  t p
te 

t p  t o 2
6

The variance of an activity is calculated as:


36
The expected completion time of all project activities, and their variances are
given below.

Activity Expected Time Variance


A* 8 0.44
B 4 1.78
C* 12 1.78
D 5 1.78
E* 4 0
* denotes critical activity.

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Project Planning and Control

As the critical path is A-C-E, the expected project completion time (expected
time) for A-C-E = 8 + 12 + 4 = 24 days.

Therefore, expected project completion time µ = 24 days.

The total variance of the project (considering all activities) =


0.44 + 1.78 + 1.78 + 1.78 + 0 = 5.78

Therefore, standard deviation () of the project   5.78 = 2.4


The probability of completing the project by 26 days is the probability of
completing the project in less than or equal to 26 days.
For x = 26, the corresponding value of the standard normal variate ‘z’ is
z = (Due date – Expected date of completion) / (Standard deviation of the
project)
= (26-24)/2.4 = 0.83

 26  24 
P(x < 26)  P z  
 2.4 
 P(z < 0.83)

 P(  α  z  0)  P(0  z  0.83)

(From the standardized normal distribution function, F(z) table, the area under
the normal curve corresponding to z = 0.83 is 0.2967.) Refer to Figure 8.3 (b).

Figure 8.3 (b): Calculation of Probability

 0.5 + 0.2967
 0.7967
Hence, the probability of completing the project in 26 days is 0.7967.

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Activities: Sequencing, Estimating Duration, and Scheduling

Note: In standard normal distribution, probability of completing the project in


expected time ( µ ) will always be 0.5. As due date (26 days) is more than µ (24
days), probability of completion will definitely be greater than 0.5.

Check Your Progress


41. Which of the following statements is not true regarding the critical path
method?
a. It is used to predict the project duration by finding out which sequence
of activities (the critical path) has the least amount of scheduling
flexibility.
b. The critical path of the project is the shortest path through the network.
c. The length of the critical path gives the shortest allowable time for the
completion of the project.
d. Both (b) and (c)
42. ______________ is a network analysis technique used to predict the project
duration by finding out which sequence of activities has the least amount of
scheduling flexibility.
a. Crashing
b. Fast tracking
c. Decomposition
d. Critical path method

Exercises
(Questions E-G)
Nishant International has taken up an overseas project. The optimistic, most
likely, and pessimistic times of the activities in the project are given here.

Activity Optimistic time Most likely time Pessimistic time


A 2 8 12
B 3 5 10
C 4 7 18
D 3 9 16
E 5 8 14

E. Calculate the expected time of completion of the project.


F. Calculate the total variance of the project.
G. Find out the probability of completing the project in 27 days.

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H. Saharsh is the project manager of a company currently working on a


software project. The expected project completion time is 28 days and the
standard deviation of the project is 2.56. What is the probability of Saharsh
finishing the project in 30 days?
I. The variances of the critical activities of a project are 0.2, 0.6, 0.5, and 0.7.
What is the standard deviation of the project?
J. The optimistic, pessimistic, and most likely times of an activity are 3, 10,
and 7 days, respectively. Calculate the variance of the activity.

8.7.4 Graphical Evaluation and Review Technique (GERT)


Graphical Evaluation and Review Technique is similar to PERT, except that it
allows multiple project activities by the way of looping and branching project
activities. Suppose an activity fails due to some unavoidable reasons, then the
project manager has to look for alternative ways to obtain the end result.
Similarly, some of the activities may not be carried out at all, some may be
partially carried out and some that may be repeated. PERT cannot show
alternative plans in a single network diagram. GERT overcomes these problems
as it shows alternative ways to continue the project.
8.7.5 Duration Compression Techniques
When the project manager finds that the expected completion time of the project
is more than the desired time, he attempts to reduce the project duration using
some duration compression techniques like crashing, fast tracking, etc.
Crashing
Crashing refers to decreasing the total project duration after analyzing a number
of alternatives to determine how to get the maximum duration compression for
the least cost. Here, the project manager reduces the project duration by allotting
more resources, subcontracting some activities, using more labor, etc. The
project manager considers the time-cost trade-offs for all project activities. These
trade offs reveal how the duration of a project activity is reduced with additional
costs. Normally, the project manager focuses on time-cost trade offs for the
critical activities of the project as they play a major role in deciding the project
completion time.
Some people argue that crashing may decrease the quality of a project. As all
project activities cannot be completed just by adding more resources, the project
manager should ensure that the quality of the project end product does not suffer
as a result of crashing. Activities like planning and inspection are not crashed, in
general, because they have an effect on the quality of the project output.
The following are the types of activities that are considered for crashing:
1. A critical activity of the project.
2. An activity of longer duration.

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3. An activity that has low per unit crash cost.


4. An activity that does not cause any quality problems, if crashed
5. An activity that is labor intensive.
The crashing procedure is explained below:

8.7.6 Constraints
 The maximum extent of crashing of an activity is given as part of the problem
statement. (For instance, in Example 8.3, activity 1—2 can be crashed by a
maximum of 2 weeks, from 8 to 6 weeks).

 Activities of the critical path(s) are to be crashed, in order to reduce the total
project time.

8.7.7 Steps
1. Identify the sequence of activities and prepare a network diagram. Each
activity should list the details of normal cost, normal time, crash cost and
crash time.
2. Compute the critical path of the project network.

Crash cost  Normal cost 


3. Calculate the crashing cost for all project activities using the formula:

Normal time  Crash time


Crash slope =

4. The most effective way of crashing, is to start with the activity in the
critical path having minimum crash slope, that is, minimum additional cost
per unit of reduction in time. If possible, the other critical path activities
can also be crashed in the ascending order (lowest to highest) of the crash
slope. At each step of crashing, an activity can be crashed to the extent
possible, such that the relevant path continues to be a critical path.
5. While crashing a project, if we get new critical paths in addition to the
original critical path, subsequent crashing should be done in such a way
that there is reduction of time along all these parallel critical paths so that
the total project duration decreases.
6. The crashing process is continued till further crashing is not possible, or it
does not result in the reduction of project duration.
7. For different project durations, the total cost of the project is calculated,
including both critical and non-critical activities, and including both direct
(normal, crashing) and indirect costs.

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This will be clearer in the explanation of Example 8.3.


Example 8.3
The normal costs and crash costs, and the normal times and crash times of all
project activities in a particular project are given below. Assume that indirect
costs of the project are Rs. 40 per week. Find out the optimum project duration
and the minimum cost of the project.

Activity Immediate Normal Crash


Predecessor

Cost Time Cost Time

1--2 -- 1500 8 2000 6

1--4 -- 2000 10 3000 7

2--3 1--2 1100 6 1500 4

2--5 1--2 900 8 1500 5

4--6 1-4 and 2-3 300 12 400 8

5--6 2--5 500 5 800 4

Crash cost  Normal cost 


The per unit crash cost (also called crash slope) for each activity is calculated as:

Normal time  Crash time


Crash slope =

For each activity, the crash slope and the maximum possible reduction in time
are tabulated as shown below.

Activity Crash Slope Maximum Reduction in Time


(Crashing Cost per Week)

1-2 250 2

1-4 333.3 3

2-3 200 2

2-5 200 3

4-6 25 4

5-6 300 1

For clarity of understanding, we use a simplified network diagram without start


time and finish time.

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Figure 8.4 (a): Network Diagram – Before Crashing

From network diagram 12.4 (a) we can identify three paths ( activity 3-4 is a
dummy activity and does not consume any resource).
Path A: 1-2-3-4-6 = 8+6+12 = 26 weeks
Path B: 1-4-6 = 10+12 = 22 weeks
Path C: 1-2-5-6 = 8+8+5 = 21 weeks

 Critical path = Path A = 26 weeks


Total cost = Direct Cost + Indirect Cost
= Rs. (1500 + 2000 + 1100 + 900 + 300 + 500) + (Rs. 40 × 26)
= Rs. 6300 +Rs. 1040
= Rs. 7340
Among the critical path activities (1- 2, 2 – 3, and 4 – 6), crash slope is
minimum for activity 4-6 i.e. Rs. 25 per week. So we will first crash activity 4-6.
We can crash it to the maximum extent of four weeks [Refer to network diagram
16.4 (b)].

Figure 8.4 (b): Network Diagram – After Crashing

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Project Planning and Control

Path A: 1-2-3-4-6 = 8+6+8 = 22 weeks


Path B: 1-4-6 = 10+8 = 18 weeks
Path C: 1-2-5-6 = 8+8+5 = 21 weeks

 Path A continues to be the (only) critical path.


Crashing cost at this stage, for 4 weeks = Rs. 25 × 4 = Rs. 100
Total Cost = Direct cost (before crashing) + Crashing Cost + Indirect cost
= Rs. 6300 + Rs. 100 + (Rs. 40 × 22)
= Rs. 6300 + Rs. 100 + Rs. 880
= Rs. 6400 + Rs. 880
= Rs. 7280
Among the critical path activities (1- 2, 2 – 3, and 4 – 6), 4 – 6 cannot be crashed
further. Among the remaining critical activities 1 – 2 and 2 – 3, crash slope is
minimum for activity 2-3 at Rs. 200 per week. So we can next crash activity 2-3,
by a maximum of 2 weeks. [Refer to network diagram 16.4 (c)]

Figure 8.4 (c): Network Diagram – After Crashing

Path A: 1-2-3-4-6 = 8+4+8 = 20 weeks


Path B: 1-4-6 = 10+8 = 18 weeks
Path C: 1-2-5-6 = 8+8+5 = 21 weeks
But then Path A 1-2-3-4-6 will no longer be a critical path; the critical path will
change to path C 1-2-5-6, i.e., 21 weeks.
To ensure that Path A also continues to be one of the critical paths, we should
crash 2-3 by only 1 week (and not 2 weeks). Again refer network diagram 16.4
(c).
Path A: 1-2-3-4-6 = 8+5+8 = 21 weeks
Path B: 1-4-6 = 10+8 = 18 weeks

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Path C: 1-2-5-6 = 8+8+5 = 21 weeks

 Both path A & path C become parallel critical paths.


Crashing cost at this stage, for 4 weeks of 4-6 and 1 week of 2-3
= Rs. (25 × 4) + (200 × 1)
= Rs. 300
Total Cost = Direct cost (before crashing) + Crashing Cost + Indirect cost
= Rs. 6300 + Rs. 300 + (Rs. 40 × 21)
= Rs. 6300 + Rs. 300 +Rs. 840
= Rs. 6600 + Rs. 840
= Rs. 7440
Now activity 1-2 is common to both the critical paths (1-2-3-4-6 and 1-2-5-.6)
and this activity can be crashed to the maximum extent of 2 weeks [Refer to
network diagram 16.4 (d)].

Figure 8.4 (d): Network Diagram – After Crashing

Path A: 1-2-3-4-6 = 6+5+8 = 19 weeks


Path B: 1-4-6 = 10+8 = 18 weeks
Path C: 1-2-5-6 = 6+8+5 = 19 weeks

 Both path A & path C continue to be the parallel critical paths.


Crashing cost at this stage, for 4 weeks of 4-6, and 1 week of 2-3, and 2 weeks of
1-2
= Rs. (25 × 4) + (200 × 1) + (250 × 2)
= Rs. 800
Total Cost = Direct cost (before crashing) + Crashing Cost + Indirect cost
= Rs. 6300 + Rs. 800 + (Rs. 40 × 19)

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Project Planning and Control

= Rs. 6300 + Rs. 800 +Rs. 760


= Rs. 7100 + Rs. 760
= Rs. 7860
In Path A (1-2-3-4-6), the only critical activity that has further potential for
crashing is 2-3, to an extent of 1 week. In addition to this, as path C is also
critical, we should crash some activity of path C (1-2-5-6) also by 1 week, to
reduce the project duration by 1 week. Of the two activities 2-5 and 5-6 that have
scope for crashing, the crash slope is minimum for activity 2-5 (Rs. 200/week)
when compared to 5-6 (Rs. 300/week). So we will crash 2-5 by 1 week.
Path A: 1-2-3-4-6 = 6+4+8 = 18 weeks
Path B: 1-4-6 = 10+8 = 18 weeks
Path C: 1-2-5-6 = 6+7+5 = 18 weeks

 Now all the three paths are parallel critical paths.


Crashing cost at this stage, for 4 weeks of 4-6, and (1+1) week of 2-3, and 2
weeks of 1-2, and 1 week of 2-5
= Rs. (25 × 4) + (200 × 2) + (250 × 2) + (200 × 1)
= Rs. 1200
Total Cost = Direct cost (before crashing) + Crashing Cost + Indirect cost
= Rs. 6300 + Rs. 1200 + (Rs. 40 × 18)
= Rs. 6300 + Rs. 1200 +Rs. 720
= Rs. 7500 + Rs. 720
= Rs. 8220
As all the three paths are critical and there is no further scope for crashing in
Path A (1-2-3-4-6), there is no further scope for reduction in project duration.

Project Indirect
Direct Costs Total Costs
Duration Costs
Before crashing Crashing costs
26 6300 - 1040 7340
22 6300 100 880 7280
21 6300 300 840 7440
19 6300 800 760 7860
18 6300 1200 720 8220

Therefore, optimum project duration is 22 weeks, when the total cost incurred is
minimum, i.e., Rs. 7280.

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Fast Tracking
In this technique, the project manager attempts to reduce the project duration by
doing project activities in parallel. Suppose activity B can be started only after
the completion of activity A in normal conditions. But the project manager can
start both activities at the same time, but makes modifications to activity B as per
the changes in activity A. This ultimately reduces the duration of the entire
project.
For example, the software code is normally written only after the design is
approved. But both the activities are started at the same time and the final code
is written only after the software design is approved by the top management.
However, this technique requires modifications, reworking, etc.

8.7.8 Resource Leveling


CPM and PERT techniques assume that the project has unlimited resources, and
they can be assigned for project activities. However, in reality, project resources
are usually limited. Sometimes activities may be delayed because of the non-
availability of resources.
So, the project manager sequences the project keeping in mind the availability of
resources, which forces him to recalculate the activity schedules. Normally, the
project manager assigns the available resources to the critical activities first as
they play a major role in determining the total completion time of a project.

Check Your Progress


43. Which of the following options are called duration compression techniques
in project management?
i. Crashing
ii. Fast tracking
iii. Critical path method
iv. Program evaluation and review technique
a. Only i and ii
b. Only i and iv
c. Only ii and iii
d. Only iii and iv
44. ____________ refers to decreasing the total project duration after analyzing
a number of alternatives to determine how to get the maximum duration
compression for the least cost.
a. Fast tracking
b. Crashing
c. Decomposition
d. None of the above
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Project Planning and Control

45. Identify the correct formula to calculate the crash slope in project crashing.
Normal cost  Crash cost
Normal time  Crash time
a.

Crash time  Normal time


Crash cost  Normal cost
b.

Normal cost  Crash cost


Crash time  Normal time
c.

Crash cost  Normal cost


Normal time  Crash time
d.

46. Which of the following statements is not true regarding the graphical
evaluation and review technique?
a. It is similar to the program evaluation and review technique.
b. It allows multiple project activities by the way of looping and branching
project activities.
c. It does not show alternative plans in a single network diagram.
d. Both (a) and (b
47. Identify the activities that should not be considered for crashing.
a. Activities that are labor intensive.
b. Activities that are of longer duration
c. Activities that have a high per unit crash cost
d. Activities that do not cause any quality problems, when crashed

Exercise
K. If the normal cost and crash cost of an activity A are Rs. 2,500 and Rs.
3,000 and the normal time and crash time are 9 and 7 days respectively, then
what is the crash slope of activity A?

8.8 Schedule Control


The project manager has to ensure that all the project activities are being carried
out as per the schedules. Schedule control studies all the factors that affect
project schedules. Schedule control determines the schedule changes and
manages to complete them within the desired duration. Based on the changes,
the project manager updates the project schedules.
The project manager has to consider the project schedule, performance reports,
and change requests while controlling the schedule. The project schedule
represents the planned start and expected finish dates for each project activity. It

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Activities: Sequencing, Estimating Duration, and Scheduling

provides a basis for the project manager to measure the schedule performance.
Performance reports provide information about schedule performance and point
out whether the activities are proceeding as per the planned schedule or not. The
project manager initiates controls to complete all the activities within the desired
time. He considers the change requests made by the project stakeholders, which
may be verbal or written. These change requests may be for extension or
acceleration of project schedules.
The project manager uses techniques like schedule change control system, and
performance measurement in controlling the project schedule. The schedule
change control system describes the procedures by which project schedules can
be modified. The methods include redrawing the project network diagrams, and
understanding the proposed changes. Performance measurement systems assess
the effective completion of the project activity in the normal duration. They
calculate the magnitude of variation that may occur for each project activity.
Software packages like Project 2000 also help the project manager in controlling
the project schedules by continuously studying the planned and actual time
periods of each project activity. Sometimes additional planning is required when
the project manager thinks that it is important to incorporate certain changes in
the project. The project manager then revises the duration estimates, modifies the
sequence of activities and analyzes alternative schedules.

Check Your Progress


48. _________ deals with the study of factors that influence and change the
project schedules and aims at managing changes to complete the project
within the estimated schedule.
a. Crashing
b. Fast tracking
c. Schedule control
d. Schedule development

8.9 Summary
 According to the Project Management Body of Knowledge, a project network
diagram is a schematic representation of the project activities and the logical
relationships (dependencies) among them.
 The project network diagram helps the project manager in sequencing,
scheduling, and controlling the project. It represents all the project activities, the
sequence in which they have to be performed, the duration of each activity, the
interdependencies among various activities and the criticality (significance) of
each activity.

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Project Planning and Control

 Once the project activities are identified using the work breakdown structure, the
project manager prepares an activity list of the project. He puts all the activities
down in a logical sequence to arrive at the project end-product. This is known as
activity sequencing.
 The project manager sequences all the project activities in an appropriate
manner and represents them in the project network diagram. Some of the
methods of activity sequencing are arrow diagram method, precedence diagram
method, and conditional diagramming method.
 After activity sequencing, the project manager estimates the duration of each
activity to calculate the duration of the entire project. The duration of an activity
is the time period required to complete the activity.
 Schedule development is concerned with determining a realistic start and finish
time for project activities. It aims to match project resources like machinery,
materials, and labor with project activities over time.
 Some of the methods used by project managers for schedule development are:
Critical Path Method (CPM), Program Evaluation and Review Technique
(PERT), and Graphical Evaluation and Review Technique.
 Through schedule control, the project manager ensures that all the project
activities are being carried out as per schedule. It determines the schedule
changes and manages to complete them within the desired duration.

8.10 Glossary
 Activity Sequencing: It is the process of identifying and documenting
interdependency relationships.
 Activity: An activity is an element of work performed during the course of a
project.
 Arrow Diagram Method: A network diagram constructed using arrows to
represent the activities and connecting them at nodes to show the dependencies.
This method is also called as activity-on-arrow (AOA) method.
 Crashing: It refers to decreasing the total project duration after analyzing a
number of alternatives to determine how to get the maximum duration
compression for the least cost.
 Critical Path Method: It is a network analysis technique used to predict the
project duration by finding out which sequence of activities (the critical path)
has the least amount of scheduling flexibility.
 Dummy Activity: An activity of zero duration that is used to represent the
logical relationship in the network diagram is called a dummy activity.
 Fast Tracking: Compressing the project schedule by overlapping activities that
would normally be done in sequence.
 Finish to Finish: Finish to finish dependency states that activity A must finish
before activity B finishes.
 Finish to Start: Finish to start dependency states that activity A must be
completed before activity B can begin.

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Activities: Sequencing, Estimating Duration, and Scheduling

 Free Float: This is the amount of time by which the completion of an activity
can be delayed beyond the earliest finish time without affecting the earliest start
of a subsequent activity.
 Independent Float: This is the amount of time by which the start of an activity
can be delayed without affecting the earliest start of any activities following
immediately.
 Most Likely Time: It is the time that is the best guess for an activity completion
– either optimistic or pessimistic.
 Node: It is a time-oriented reference point that signifies the start or end of an
activity. It is represented by a circle.
 Optimistic Time: Optimistic time is the minimum amount of time within which
an activity can be completed. It is possible to complete an activity within the
optimistic time only when the external environment is extremely favorable.
 Pessimistic Time: Pessimistic time is the maximum amount of time required to
complete an activity. This happens when the external environment is
unfavorable.
 Precedence Diagram Method (PDM): In this method, the network diagram is
constructed using nodes to represent the activities and connecting them with
arrows to represent the dependencies. This method is also called as activity-on-
node (AON) method.
 Project Network Diagram: It is a schematic representation of the project
activities and the logical relationships (dependencies) among them.
 Schedule Development: Evaluating activity sequences, activity durations, and
resource requirements to develop a project schedule.
 Slack: Slack is the difference between the latest event time and earliest event
time.
 Start to Finish: Start to finish dependency states that activity B must start
before activity A can finish.
 Start to Start: Start to start dependency states that activity B can be started only
if activity A has begun.
 Total Float: This is the amount of time by which the completion of an activity
can be delayed beyond its expected earliest completion time without affecting
the overall project duration.

8.11 Self-Assessment Exercises


1. After the project activities are identified, they are represented in a project
network diagram. What is a project network diagram? Explain the
fundamental concepts involved in a project network diagram.
2. The project manager sequences the project activities by understanding the
dependencies among them. How are the activities of a project sequenced?
What are the various methods of sequencing the project activities?

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Project Planning and Control

3. After the project activities are sequenced, the project manager estimates the
duration of each activity to calculate the entire project duration. Explain in
detail the methods involved in the estimation of the activity duration.
4. Scheduling eliminate production problems, facilitates timely procurement of
raw materials, and ensures project completion on time. How is a schedule
developed? Explain briefly the techniques involved in schedule
development. How can the schedule be controlled?

8.12 Suggested Reading/Reference Material


1. Prasanna Chandra, “Projects,” McGraw Hill, Seventh Edition, 2009.
2. Robert K. Wysocki, “Effective Project Management: Traditional, Agile,
Extreme,” Wiley India, 2009.
3. Jack R. Meredith and Samuel J. Mantel Jr., “Project Management: A
Managerial Approach,” Sixth Edition, Wiley India, 2008.
4. Harold Kerzner, “Project Management-A Systems Approach to Planning,
Scheduling and Controlling,” Second Edition, 2006.
5. “A Guide to the Project Management Body of Knowledge,” Project
Management Institute, Second Edition, December 2000.
6. Joseph Weiss and Robert K. Wysocki, “Five-phase Project Management: A
Practical Planning and Implementation Guide,” Basic Books, 1992.

8.13 Answers to Check Your Progress Questions


Following are the answers to the Check Your Progress questions given in the
Unit.

1. (c) finish to finish dependency


Finish to finish dependency states that activity A must finish before activity
B finishes. In the given example, collection of data is an activity and entry
of data into an information system is another activity. The activity of data
entry cannot end until the collection of data is completed. Therefore, it is an
example of finish to finish dependency.

2. (b) logical relationship


An activity of zero duration that is used to represent the logical relationship
in the network diagram is called a dummy activity. Dummy activities do not
consume any resources, but are used to maintain the proper precedence
relationship between the activities that are not connected by the nodes. They
are represented by a dashed line headed by an arrow.

3. (c) iii-ii-i
After the project activities have been identified, they are represented in a
project network diagram. The project manager sequences the project
activities, estimates the duration, and then schedules the activities. The
project manager sequences the project activities by understanding the
dependencies among them. He/she then prepares the duration estimates of
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Activities: Sequencing, Estimating Duration, and Scheduling

each project activity with the help of duration estimates from other projects,
historical information, expert advice, etc. Finally, the project manager
schedules the project activities in order to estimate the start and the finish
dates of each project activity. This scheduling helps him/her in arriving at
the duration of the project.
4. (b) Project network diagram
A project network diagram is a schematic representation of the project
activities and the logical relationships (dependencies) among them. The
diagram helps the project manager in sequencing, scheduling, and
controlling the project. It represents all the project activities, the sequence in
which they have to be performed, the duration of each activity, the
interdependencies among various activities, and the criticality (significance)
of each activity. A control chart is a graphical representation of the results of
a process over a period of time. A work breakdown structure is a
deliverable-oriented grouping of project activities that organizes and defines
the total scope of the project.

5. (d) Activity
An activity is an element of work performed during the course of a project. It
is depicted by an arrow. An event is a time-oriented reference point that
signifies the start or end of an activity. It is also called a node and is
represented by a circle. Slack is the difference between the latest event time
and earliest event time.

6. (a) tail event, head event


The project network diagram is represented by a series of activities and
nodes. An activity is a specific task or operation required to do a project. A
node is a time-oriented reference point that signifies the start or end of an
activity. An activity can be represented with ‘i’ and ‘j’ as the starting and
ending nodes, respectively. The activity can also be written as ‘i–j’. Event
‘i’ is called the tail event and event ‘j’ is called the head event.
7. (a) zero duration.
An activity of zero duration that is used to represent the logical relationship
in the network diagram is called a dummy activity. Dummy activities do not
consume resources, but are used to maintain proper precedence relationship
(start to start, start to finish, finish to start, or finish to finish) between the
activities that are not connected by the nodes. They are represented by a
dashed line headed by an arrow.

8. (c) the ending node.


In a project network diagram, an activity can be represented with i and j as
the starting and ending nodes, respectively. The activity can also be written
as i –j. Event i is called the tail event and event j is called the head event.

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Project Planning and Control

9. (a) a time-oriented reference point that signifies the start and end of an
activity.
A node, also known as an event, is a time-oriented reference point that
signifies the start or end of an activity. It is represented by a circle. An
activity is a specific task or operation required to do a project.
10. (b) An activity represents the passage of time while the nodes are points
in time that denote the starting or ending of a specific activity.
An activity is an element of work performed during the course of a project
while a node is a time-oriented reference point that signifies the start and
end of an activity. An activity represents the passage of time and the nodes
are points in time that denote the starting or ending of a specific activity. An
activity is depicted by an arrow while a node is represented by a circle.
11. (c) activity B can be started only if activity A has begun.
Start to start dependency states that activity B can be started only if activity
A has begun. This can be explained with the help of the previous example –
that is, the inspection activity can be started and continued once the raw
materials start coming. Subsequently, both activities go on in parallel.
12. (b) start to finish dependency
Start to finish dependency states that activity B must start before activity A
can finish. For instance, if a firm wants to develop a new information system
to replace the existing one, the firm has to confirm that the new system is
operating well. When the new system starts working (activity B), the
existing system can be discontinued (activity A).
13. (a) Only i, ii, and iii
An activity of zero duration that is used to represent the logical relationship
in the network diagram is called a dummy activity. Dummy activities do not
consume any resources, but are used to maintain the proper precedence
relationship between the activities that are not connected by the nodes. They
are represented by a dashed line headed by an arrow.
14. (d) The project network diagram helps to determine the start and end
dates of each activity during scheduling, but does not provide insights
into the possible trade-offs while controlling the project.
A project network diagram is a schematic representation of the project
activities and the logical relationships (dependencies) among them. The
diagram helps the project manager in sequencing, scheduling, and
controlling the project. It represents all the project activities, the sequence in
which they have to be performed, the duration of each activity, the
interdependencies among various activities, and the criticality (significance)
of each activity. It helps to determine the start and end dates of each activity
during scheduling. It also provides insights into the possible trade-offs while
controlling the project.

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15. (a) finish to start dependency.

Finish to start dependency states that activity A must be completed before


activity B can begin. If activity A involves obtaining raw material and
activity B involves inspecting the raw material, then activity B can be
performed only after the completion of activity A. Therefore, the
dependency is finish to start.

16. (b) event

An event is a time-oriented reference point that signifies the start or end of an


activity. It is represented by a circle and is also called as a node. An activity is
an element of work performed during the course of a project. It is depicted by
an arrow. Slack is the difference between the latest event time and earliest
event time.

17. (b)

In the given project, activities B and C cannot begin until activity A has
been completed. Option (b) correctly represents this activity relationship if
the arrow diagram or activity-on-arrow method is used. Option (d) is also
correct if the activity relationship is represented using the precedence
diagram or activity-on-node method.

18. (c) Only ii and iv

While sequencing the activities, the project manager analyzes the mandatory
and discretionary dependencies among the various project activities.
Mandatory dependencies are those that are inherent in the nature of project.
In these, the dependency between the activities is certain or mandatory.
Discretionary dependencies are those dependencies of the project that are
defined by the project team. Using certain best practices or standard
procedures in the project are examples of discretionary dependencies. This
dependency is also called as soft logic or preferred logic.

19. (a) Only i and iii

While analyzing the product description, the project manager has to consider
the physical characteristics of the product and the logical sequencing of the
activities to achieve the end product. The product description is generally
less detailed in the early phases of the project and is progressively
elaborated on later.

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Project Planning and Control

20. (c) Graphical Evaluation and Review Technique (GERT)


Conditional diagramming methods like the Graphical Evaluation and
Review Technique (GERT) and system dynamics represent non-sequential
activities like loops (where activities are repeated again and again) or
conditional branches (e.g., a design update is required only when errors are
found in the inspection). PDM and ADM cannot represent loops and
conditional branches.
21. (c) involves constructing the network diagram using arrows to
represent activities and connecting them at nodes to show the
dependencies.
In the arrow diagram method, the network diagram is constructed using
arrows to represent the activities and connecting them at nodes to show the
dependencies. This method uses finish-to-start dependencies only to explain
the logical relationships. This method is also called Activity-On-Arrow
(AOA) method. Options (a), (b), and (d) pertain to the precedence diagram
method.
22. (b) Mandatory dependencies
While sequencing the activities, the project manager analyzes the mandatory
and discretionary dependencies among the various project activities.
Mandatory dependencies are those that are inherent in the nature of project.
For instance, in order to install a new machine, it is necessary for the plant
layout to be finalized. Therefore, in this case, the dependency among the
activities is certain or mandatory. Mandatory dependency is also called as
hard logic. Discretionary dependencies are those dependencies of the project
that are defined by the project team. This kind of dependency is also called
preferred logic.
23. (c) Only ii and iii
In the precedence diagram method, the network diagram is constructed
using nodes to represent the activities and connecting them with arrows to
represent the dependencies. This method uses all four types of dependencies
and is also called the activity-on-node method. The arrow diagram method
is also called the activity-on-arrow method.
24. (b) Only i and iii
The project manager sequences all the project activities in an appropriate
manner and represents them in the project network diagram. Methods like
the arrow diagram method and the precedence diagram method are used for
activity sequencing. In the arrow diagram method, the network diagram is
constructed using arrows to represent the activities and connecting them at
nodes to show the dependencies. In the precedence diagram method, the
network diagram is constructed using nodes to represent the activities and
connecting them with arrows to represent the dependencies. The critical path
method and the program evaluation and review technique are methods that
the project manager uses to develop schedules.

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Activities: Sequencing, Estimating Duration, and Scheduling

25. (d) i, ii, iii, and iv


After identifying the project activities using the work breakdown structure,
the project manager prepares an activity list of the project. The activities are
sequenced in order to obtain the project end product. While sequencing the
activities, the project manager has to study various aspects such as the
description of the end product, mandatory and discretionary dependencies
among the activities, external dependencies and other constraints and
assumptions of the project.

26. (c) Most likely time


Optimistic time (t0) is the minimum amount of time within which an activity
can be completed. Pessimistic time (tp) is the maximum amount of time

t p  t o 2
required to complete the activity. The variance of an activity is calculated as

,
36

where, tp = pessimistic time and to = optimistic time. Most likely time (tm) is
the time that is the best guess for the completion of an activity (neither
optimistic nor pessimistic). It is not included in the calculation of the
variance.

27. (d) crash point


The crash point is a point beyond which it is not possible to reduce the
duration of an activity. The project manager has to allocate more resources
till the crash point is arrived at. A node is a time-oriented reference point
that signifies the start or end of an activity. Slack is the difference between
the latest event time and earliest event time. Free float is the amount of time
by which the completion of an activity can be delayed beyond the earliest
finish time without affecting the earliest start of a subsequent activity.

28. (d)
b  a 2

tp  to 
36

2
The variance of an activity is calculated as
36

where tp = pessimistic time and to = optimistic time. In the given question,


for a certain activity, the pessimistic time (tp) is given as b and the optimistic
time (to) is given as a. So, the variance of the activity would be

b  a 2 .
36

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Project Planning and Control

29. (d) i, ii, iii, and iv


The project manager can use various techniques to estimate the appropriate
duration of the project activities. The duration of an activity can be
estimated by: taking estimates of the duration of similar activities in other
projects; taking the actual durations of successful projects in the past;
consulting a technical expert to estimate the activity duration; and forming a
group of people and asking them to estimate the duration of the activity after
describing the nature and characteristics of the activity. Some of methods
used for this purpose are the Delphi method, expert advice, the three-point
method, and the wide band Delphi method.

30. (d) Wide Band Delphi method


In the expert advice method, the project manager consults a technical expert
to estimate the activity duration. In the Delphi method, the project manager
forms a group of people and asks them to estimate the duration of an activity
after describing the nature and characteristics of the activity. In the three-
point method, the project manager estimates the activity duration by
considering three estimates – optimistic, pessimistic, and most likely times,
and then calculates the expected time of completion of an activity. The Wide
Band Delphi method is a combination of the Delphi method and the three-
point method. In this method, the members are asked to give an optimistic
time, a pessimistic time, and the most probable time, instead of a single
estimate. Then, the project manager follows the Delphi method and
determines the duration estimate.
31. (b) i/r, ii/p, iii/q
According to the three-point method of estimating the duration of project
activities, the project manager considers three types of estimates – optimistic
time, pessimistic time, and most likely time  in order to calculate the
duration of an activity. Optimistic time (t0) is the minimum amount of time
within which an activity can be completed. Pessimistic time (tp) is the
maximum amount of time required to complete an activity. Most likely time
(tm) is the time that is the best guess for the completion of an activity
(neither optimistic nor pessimistic). Expected time,

t 0  4t m  t p
t= .
6

a  4b  c
32. (b)
6

According to the three-point method of estimating the duration of project


activities, the project manager considers three types of estimates – optimistic
time, pessimistic time, and most likely time  in order to calculate the
duration of an activity. Optimistic time (t0) is the minimum amount of time

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Activities: Sequencing, Estimating Duration, and Scheduling

within which an activity can be completed. Pessimistic time (tp) is the


maximum amount of time required to complete an activity. Most likely time
(tm) is the time that is the best guess for the completion of an activity
(neither optimistic nor pessimistic). Expected time,

t 0  4t m  t p
t= . In the given question, t0 = a, tm = b, and tp = c.
6
a  4b  c
Therefore, expected time, t = .
6

33. (c) It can be more than the pessimistic time of that activity.
Optimistic time (t0) is the minimum amount of time within which an activity
can be completed. Pessimistic time (tp) is the maximum amount of time
required to complete an activity. Most likely time (tm) is the time that is the
best guess for the completion of an activity (neither optimistic nor
pessimistic).

t 0  4t m  t p
Expected time, t = .
6
The expected time of an activity cannot be more than the pessimistic time of
that activity. However, it can be more than the optimistic time. The expected
time of an activity is more than, less than, or equal to the most likely time of
that activity.

34. (b) Resource calendar


The project manager prepares two types of calendars – resource calendars
and project calendars to schedule the project. Resource calendars schedule
the project on the basis of the resources used. The focus is on scheduling
and utilizing specific resources effectively. Resource calendars deal with
how a specific resource or specific category of resources is spent over a
period of time. Project calendars emphasize the completion time of the
project activities. They are concerned with how various project resources are
consumed over a period of time. A resource pool description contains details
of all the project resources and their allocation to project activities.

35. (d) i, ii, iii, and iv


The project manager can use methods like the critical path method, the
program evaluation and review technique, and the graphical evaluation and
review technique for schedule development. These methods are used to:
estimate the completion time of the project; find out if the project is behind,
ahead of, or on schedule; compare the actual resources spent with the
planned resources at any stage of the project; and study activities that are
critical for project completion and activities that can be delayed without
delaying project completion.

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Project Planning and Control

36. (b) i/r, ii/p, iii/q


There are three types of floats – total float, free float, and independent float.
Total float is the amount of time by which the completion of an activity can
be delayed beyond its expected earliest completion time without affecting
the overall project duration. Free float is the amount of time by which the
completion of an activity can be delayed beyond the earliest finish time
without affecting the earliest start of a subsequent activity. Independent float
is the amount of time by which the start of an activity can be delayed
without affecting the earliest start of any activities following immediately.
37. (d) Independent float is the difference between total float and tail slack.
Total float is the difference between the latest start time and the earliest start
time of a project activity. Slack is the difference between the latest event
time and earliest event time. Free float is the difference between total float
and head slack. Independent float is the amount of time by which the start of
an activity can be delayed without affecting the earliest start of any activities
following immediately. It is the difference between free float and tail slack.

38. (b) The Work Breakdown Structure


Methods like the critical path method, the program evaluation and review
technique, and the graphical evaluation and review technique are used for
schedule development. The work breakdown structure is a deliverable-
oriented grouping of project activities that organizes and defines the total
scope of the project.

39. (a) Head slack


In an event, slack is the difference between the latest event time and earliest
event time. For an event ‘i’, slack = Li – Ei. For an activity (i, j), the slack of
event ‘j’ is called head slack, while the slack of event ‘i’ is called tail slack.
Head slack = Lj – Ej, and Tail slack = Li – Ei.
40. (c) Only ii and iv
The critical path method, the program evaluation and review technique, and
the graphical evaluation and review technique are the various methods used
for scheduling a project. Black box is a technique used to enhance creativity
in individuals. The realized yield approach is a method used for estimating
the rate of return required by the equity shareholders.
41. (b) The critical path of the project is the shortest path through the
network.
Critical path method is a network analysis technique used to predict the
project duration by finding out which sequence of activities (the critical
path) has the least amount of scheduling flexibility. In this method, the
project manager identifies the critical activities of the project that constitute
the critical path of the project. The critical path of the project is the longest

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Activities: Sequencing, Estimating Duration, and Scheduling

path through the network. The length of the critical path gives the shortest
allowable time for the completion of the project. This helps the project
manager to concentrate and prioritize critical activities while allocating
project resources.

42. (d) Critical path method


Critical path method is a network analysis technique used to predict the
project duration by finding out which sequence of activities (the critical
path) has the least amount of scheduling flexibility. In this method, the
project manager identifies the critical activities of the project that constitute
the critical path of the project. Crashing refers to decreasing the total project
duration after analyzing a number of alternatives to determine how to get the
maximum duration compression for the least cost. Fast tracking refers to
compressing the project schedule by overlapping activities that would
normally be done in sequence. Decomposition refers to the breaking down
of work into hierarchy of activities and tasks.
43. (a) Only i and ii
When the expected completion time of the project is more than the desired
time, the project manager tries to reduce the project duration using some
duration compression techniques like crashing and fast tracking. Crashing
refers to decreasing the total project duration after analyzing a number of
alternatives to determine how to get the maximum duration compression for
the least cost. Fast tracking refers to compressing the project schedule by
overlapping activities that would normally be done in a sequence. The
critical path method and program evaluation and review technique are
techniques used by the project manager to develop schedules.
44. (b) Crashing
Crashing refers to decreasing the total project duration after analyzing a
number of alternatives to determine how to get the maximum duration
compression for the least cost. In crashing, the project manager reduces the
project duration by allotting more resources, subcontracting some activities,
using more labor, etc. Fast tracking refers to compressing the project
schedule by overlapping activities that would normally be done in sequence.
Decomposition refers to the breaking down of work into a hierarchy of
activities and tasks.

Crash cost  Normal cost


Normal time  Crash time
45. (d)

Crash slope is the per unit crash cost for each activity involved in a project.

Crash cost  Normal cost


Normal time  Crash time
It is calculated as, .

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Project Planning and Control

46. (c) It does not show alternative plans in a single network diagram.
The graphical evaluation and review technique is similar to the project
evaluation and review technique. It allows multiple project activities by the
way of looping and branching project activities. The program evaluation and
review technique cannot show alternative plans in a single network diagram.
This problem is overcome in the graphical evaluation and review technique
as it shows alternative ways to continue the project.
47. (c) Activities that have a high per unit crash cost
Crashing refers to decreasing the total project duration after analyzing a
number of alternatives to determine how to get the maximum duration
compression for the least cost. Following are the type of activities that are
considered for crashing: activities that are of longer duration; activities that
are labor intensive; activities that are critical; activities that have a low per
unit crash cost; and activities that do not cause any quality problems, if
crashed.
48. (c) Schedule control
Schedule control studies all the factors that affect project schedules. It
determines the schedule changes and manages to complete them within the
desired time. Based on the changes, the project manager updates the project
schedules. Crashing refers to decreasing the total project duration after
analyzing a number of alternatives to determine how to get the maximum
duration compression for the least cost. In this technique, the project
manager attempts to reduce the project duration by carrying out project
activities in parallel. Schedule development is concerned with determining a
realistic start and finish time for project activities.

8.14 Answers to Exercises


Following are the answers to the Exercises given in the unit.
A. 7.5 days

t 0  4t m  t p
t=
6
Where,
t = expected time
to = optimistic time = 5 days
tm = most likely time = 7 days
tp = pessimistic time = 12 days

5  4  7  12
t= = 7.5 days.
6

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Activities: Sequencing, Estimating Duration, and Scheduling

B. 18 days
Earliest start times:
Activity A to X, EiX = 3 days
Activity B to X, EjX = 5 days
Activity C to X, EkX = 7 days
Duration estimates:
Activity A to X, tiX = 5 days
Activity B to X, tjX = 7 days
Activity C to X, tkX = 11 days
Earliest event time at X, EX = Maximum [(EiX + tiX), (EjX + tjX), (EkX + tkX)]
= [(3 + 5), (5 + 7), (7 + 11)] = (8, 12, 18) = 18 days.
C. 2, 0, -2
Total float = (L2 – E2 ) – t 12 = (20 – 11) – 7 = 9 – 7 = 2.
Free float = (E2 – E1 ) – t12 = (18 – 11) – 7 = 7 – 7 = 0.

Independent float= (E2 – L1 ) – t12 = (18 – 13) – 7 = 5 – 7 = -2.

D. 1
Total float = (L2 – E2 ) – t 12 = (18 – 9) – 8 = 9 – 8 = 1.
E. 25.34

 t 0  4 t m  t p   t p  t o 2
Activity Optimistic Most Pessimistic Expected time Variance


   
Time (to) Likely Time (tp)

   
Time (tm)

 
6 36

A 2 8 12 7.67 2.78

B 3 5 10 5.5 1.36

C 4 7 18 8.33 5.44

D 3 9 16 9.17 4.69

E 5 8 14 8.5 2.25

Critical path of the project = A – D – E.


Expected times of completion,
A = 7.67

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Project Planning and Control

D = 9.17
E = 8.5

Expected time of completion of the project,  = 7.67 + 9.17 + 8.5 = 25.34.

F. 16.52
Refer table above
Total variance of the project = Sum of variances of all the activities in the
project = 2.78 + 1.36 + 5.44 + 4.69 + 2.25 = 16.52.
G. 0.6554
Refer table above
z is the probability of completing the project in 27 days. It is calculated as:

Due date - Expected date of completion x -µ


z= =
Standard deviation of the project σ

Due date, x = 27 days


Expected date of completion,  = 25.34

Total variance of the project = 16.52.

Standard deviation,  = Variance = 16.52 = 4.064.

The probability of completing the project in 27 days is the probability of


completing the project in less than or equal to 27 days.
For x = 27, the corresponding value of the standard normal variate,

x -µ 27 - 25.34
z= = = 0.4085.
σ 4.064

P(x≤27)  P Z ≤
27 - 25.34

 P(z < 0.4085)


4.064

 P (-α ≤ z ≤ 0) + P (0 ≤ z ≤ 0.4085)
(From the standardized normal distribution table or F(z) table, the area
under the normal curve corresponding to z = 0.4085 is 0.1554.)

 0.5 + 0.1554 = 0.6554


Hence, the probability of completing the project in 27 days is 0.6554.
(Note: In standard normal distribution, the probability of completing the project
in the expected time (  ) will always be 0.5. As due date (27 days) is more than
 (25.34 days), the probability of completion will definitely be greater than 0.5.)

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Activities: Sequencing, Estimating Duration, and Scheduling

H. 0.7823
Assume z is the probability of completing the project in 30 days. It is
calculated as:

Due date  Expected date of completion


z=
Standard deviation of the project

Due date, x = 30 days


Expected date of completion,  = 28 days

Standard deviation,  = 2.56


The probability of completing the project by 30 days is the probability of
completing the project in less than or equal to 30 days.
For x = 30, the corresponding value of the standard normal variate, z =
xµ 30  28
= = 0.7813.
σ 2.56

 30  28 
P(x < 30)  P z  
 2.56 

 P(z < 0.7813)


 P(α  z  0)  P(0  z  0.7813)
(From the standardized normal distribution table or F(z) table, the area
under the normal curve corresponding to z = 0.7813 is 0.2823.)
 0.5 + 0.2823 = 0.7823
Hence, the probability of completing the project in 30 days is 0.7823.
(Note: In standard normal distribution, the probability of completing the project
in expected time (  ) will always be 0.5. As due date (30 days) is more than 
(28 days), the probability of completion will definitely be greater than 0.5.).
I. 1.414
Variances of critical activities of a project = 0.2, 0.6, 0.5, and 0.7.
Total variance of the project = 0.2 + 0.6 + 0.5 + 0.7 = 2.0

Standard deviation = Variance = 2 = 1.414.

tp  to 
J. 1.36
2
Variance =
36

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Project Planning and Control

Where, tp = pessimistic time = 10 days


to = optimistic time = 3 days

Variance =
10  32 = 1.36.
36

K. 250
Given,
Normal cost = Rs. 2,500
Crash cost = Rs. 3,000
Normal time = 9 days
Crash time = 7 days

Crash cost  Normal cost 3000  2500


Normal time  Crash time 97
Crash slope = = = 250.

108
Unit 9
Project Review
Structure
9.1 Introduction
9.2 Objectives
9.3 Importance of Project Review
9.4 Types of Project Reviews
9.5 Project Review Stages
9.6 Project Status Review Meetings
9.7 Advantages of a Project Status Review Meeting
9.8 Types of Project Status Meetings
9.9 Summary
9.10 Glossary
9.11 Self-Assessment Exercises
9.12 Suggested Reading/Reference Material
9.13 Answers to Check Your Progress Questions

9.1 Introduction
In the previous unit, we have discussed activity sequencing, estimation of
duration and scheduling. In this unit, we will discuss project review. Once a
project is organized, in terms of building the project team and drawing up the
operating rules, it is time for the project manager to design and develop an
effective tool to check whether the activities are proceeding as per the plan. This
task requires a mechanism to review the performance of various project aspects
such as project status, product design and process.
This unit will explain the importance of the project review process. We will
discuss the various types of project reviews and the different stages involved in
the project review. We shall then move on to discuss project status review
meetings and the advantages of conducting them. Finally, we would be
explaining the various types of project status meetings.

9.2 Objectives
By the end of this unit, the students should be able to:

 understand the importance of project review.


 classify the various types of project reviews.
 define project review stages.
 discuss project status review meetings.
 identify the advantages of a project status review meeting.
 recognize the types of project status meetings.
Project Planning and Control

9.3 Importance of Project Review


Once the project enters the implementation phase, the project manager should
take up the responsibility of reviewing the status of the project in a timely and
phased manner. Project reviews conducted at various stages of project
implementation play a major role in the success of a project. The project
manager conducts reviews to find out;

 If the project can accomplish the business goals.


 Whether the rules of the organization are understood properly and implemented
 If it is worthwhile to take up the project at all before entering into major
contracts
 Whether the project is managed effectively and the team members are sure of
completing the project, by following the guidelines.
Reviews give the project manager and the organization a chance to solve
problems before they get out of hand, or to improve the way in which the
projects are being handled. To derive the maximum benefit out of the reviews
the project manager has to take follow-up action with an open mind. Reviews
ensure that the project utilizes the available funds to gain business advantage. On
the whole, a review helps the project manager;

 Keep in mind the purpose of carrying out a project


 Determine the appropriateness of the project activities from time to time
 Gauge the way in which the objectives are being accomplished
 Verify the completion of the project
 Evaluate the cost of the project
 Understand the project requirements.

Check Your Progress


1. Which of the following is/are the purpose/s of a project review?
i. To determine whether the project can accomplish the business goals.
ii. To check whether the project is exceeding the budget limits set by the
management.
iii. To determine whether it is worthwhile taking up the project at all before
entering into major contracts.
iv. To see whether the project is being managed effectively and whether
the team members can complete the project by following the guidelines.
a. i, ii, iii, and iv
b. Only i and ii
c. Only i, iii, and iv
d. Only i, ii, and iii

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Project Review

2. In which of the following ways does the review help the project manager?
i. To remember the purpose of carrying out the project.
ii. To verify the completion of the project.
iii. To evaluate the cost of the project.
iv. To understand the project requirements.
a. Only i
b. Only ii and iii
c. Only iii and iv
d. i, ii, iii, and iv

9.4 Types of Project Reviews


A project manager has to conduct various reviews throughout the life of a project
to ensure that it is progressing towards achieving the planned objectives. The
manner in which these reviews are conducted decides the success of current and
future projects. In general, a project manager conducts three types of reviews --
status reviews, design reviews, and process reviews.

9.4.1 Status Reviews

Status review is the most common and frequently conducted review in


organizations taking up projects. These reviews are conducted at fixed intervals
to review the present position of the project. A status review is usually
conducted at two levels: cursory review and comprehensive review.

Though deciding the frequency of project reviews is largely a matter of


judgment, a weekly cursory and a monthly comprehensive review are conducted
for projects of one year duration. The frequency with which project reviews are
conducted also depends on the frequency with which problems occur. Project
reviews are conducted frequently whenever problems arise. Care should be taken
to avoid conducting too many project reviews. The project manager should take
care that team members give status reports that are substantiated by meaningful
numerical figures on cost, performance, time and scope. The project manager
should also be aware of the possibility of mis-reporting. In many cases, team
members report that they are on schedule even if they are not, in the hope that
they will be back on schedule by the next reporting period. The project manager
should design a reporting system that can detect deviations which are greater
than the permissible variance limits.

It is always advantageous to have an organizational structure that focuses on


correcting problems, rather than punishing those held responsible for these
problems. Therefore, project reviews must be conducted with the aim of solving
the problem rather than with the objective of giving out punishment to person

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Project Planning and Control

responsible for the problem. A problem-solving project review has three steps: (i)
Identification of existing problems, (ii) Identification of factors that cause
problems, and (iii) Exploring solutions that can solve the problem. An effective
problem-solving approach is one that can get to the root cause of the problem,
rather than trying to tackle the symptoms.

9.4.2 Design Reviews

Generally, a project is subjected to a design review, usually at the major


milestones. The primary objective of conducting a design review is to check
whether the design of the product or service being produced is of the desired
performance quality. Thus a design review is more a tool for reviewing the
performance factor than the cost, time and scope of a project.
The performance of the product determines the project’s success or failure. The
design of the product plays a major role in the effective performance of the
product. Many projects fail due to improper product design. While deviations
from the schedule with regard to the cost, time and scope of a project can be
corrected, a deviation in design would result in an underperforming product that
would be rejected by the client. Therefore, the design review plays an important
role in ensuring the performance quality of the project deliverable.
A design review should cover aspects like:
 Conditions of manufacturability, serviceability, tooling, economics of special
machinery and processes to ensure better integration of design with
manufacturing to ensure overall optimization.
 Safety of operators and maintenance personnel and precautions taken to
minimize damages.
 Scope statement along with technical specifications based on which the
performance of end products can be evaluated.
Informal reviews are also done by implementing Management By Walking
Around (MBWA) where the project manager personally goes around all the
departments to make sure that the work is progressing as planned in terms of
design. In order to make sure that a design is reviewed properly, ANSI
(American National Standards Institute) has developed some design review
criteria. These criteria can be used for any program involving design.

Example: Elements of Design Review


Elements of design review as recommended by ANSI are as follows:
1. Were the inputs rightly chosen and put into the design?
2. Are assumptions required to conduct the design review complete and
reasonable?
3. Are the assumptions identified for re-verification, if needed, on
completion of detailed design activities?
4. Are the quality and quality assurance standards specified?
5. Are the codes, standards and regulations pertaining to design and its
approval identified and met?
6. Is the construction and operating experience considered, if applicable?
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Project Review

7. Is the design interface requirement satisfactory?


8. Was the design method relevant?
9. Is the output justified in comparison with inputs?
10. Does the parts, equipment and processes suit the application?
11. Is there compatibility between the specified materials and the design
environment in which the material will be put to use?
12. Are there sufficient maintenance features and requirements?
13. Are there enough accessibility and design provisions to carry on
maintenance and repairs?
14. Is there sufficient provision for accessibility to conduct in-service
inspection that can be needed during the plant life?
15. Has the impact of the design on the public and the plant personnel been
considered?
16. Is the acceptance criterion in the design document sufficient to verify the
satisfactory accomplishment of design requirements?
17. Are sufficient pre-operational and follow-up periodic test requirements
given?
18. Are the given handling, storing, cleaning and shipping specifications
adequate?
19. Are there enough identification requirements?
20. Are adequate requirements for documenting records, acceptance, storing,
etc. specified?
Adapted from James P.Lewis “Mastering Project Management," MC Graw-Hill, 1998,
p.258.

9.4.3 Process Reviews

The primary objective of conducting a process review is to determine whether


the processes are going on as planned and whether any improvements are
possible. A process review is conducted either once in three months or at major
milestones in the project, whichever comes first. Process reviews can be
conducted once a month if the project is of shorter duration. The two objectives
of process reviews are: (i) To preserve the performance of project processes
those are going on well, and (ii) To improve the processes those are below
standard. Even if there is nothing wrong with the processes, there may be some
scope for improvement and process reviews suggest how improvements can be
made.
Process reviews are conducted by the project manager or an external facilitator.
Both of them have their own limitations. Leadership is one of the processes
crucial for the success of a project. A process review conducted by the project
manager will not get the desired feedback as the team members will not feel free
to be critical about the leadership skills of their project manager. An external
facilitator can gather better information in such situations. Sometimes, relations
between the project manager and his team may deteriorate if the team gives a
negative feedback on the leadership skills of the project manager.

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Activity: Perfect Pte. is a Singapore-based white goods manufacturing


company. To develop an ultra modern future-ready washing machine, the
company started a project (codename WM-800). It produced an initial batch
of washing machines and brought in an external consultant to review the
machine design. And after thorough inspection, the consultant found that the
temperature of the dryer was damaging the clothes. The company also found
that the project manager was not technically sound and so he did not review
the design properly. What do you think the project manager should have done
to conduct a design review? And what are the parameters to be taken into
consideration while conducting a design review?

Answer:

Check Your Progress


3. Expand ANSI.
a. Australian National Standards Institute
b. American National Symbols Institute
c. American National Standards Institute
d. American National Serial Institute
4. Project reviews conducted at fixed intervals to analyze the present position
of the projects are called
a. design reviews.
b. status reviews.
c. process reviews.
d. None of the above
5. Of the following reviews, pick the one that is done mostly during major
milestones of the project implementation and whose objective is to know
whether the design or service being produced is of the desired performance
quality.
a. Comprehensive review
b. Status review
c. Process review
d. Design review
6. Which of the project reviews is generally conducted by an external
facilitator rather than the project manager?

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a. Status reviews
b. Cursory reviews
c. Process reviews
d. Comprehensive reviews
7. Project reviews must be conducted with the aim of solving the problem
rather than punishing those who are responsible for the problem. Which of
the following is the correct sequence of steps in problem solving?
i. Exploring the solutions that can solve problems.
ii. Identifying the factors that cause problems.
iii. Identifying the existing problems.
a. i-ii-iii
b. iii-ii-i
c. ii-iii-i
d. ii-i-iii
8. The review that is done on a weekly basis as part of the status review of the
projects is called
a. comprehensive review.
b. cursory review.
c. design review.
d. process review
9. Which of the following are the two objectives of process reviews?
i. To review the financial performance of the project.
ii. To preserve the performance of project processes that are going well.
iii. To improve the processes that are below standard.
iv. To ensure the safety of operators and maintenance personnel and take
precautions to minimize damage.
a. Only i and ii
b. Only i and iv
c. Only ii and iii
d. Only iii and iv
10. Which of the following aspects is not covered by design review?
a. Conditions of manufacturability
b. Serviceability
c. Control of costs in project implementation
d. Safety of operators and maintenance and personnel

9.5 Project Review Stages


A review should always be conducted before taking any major decisions that can
affect the future of the project. Some of the important points or stages at which a
review is conducted are as follows;

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 In the initial stages of the project life cycle, i.e., after the project proposal has
been submitted.
 At the stage when an in-depth evaluation is conducted i.e., after the primary
business case has been accepted.
 During the implementation of the project, i.e., while the activities of the project
are being carried out, particularly at the following points – before entering into
major contracts; when the major output of the project is to be delivered; at points
where the risk is substantially high; and at points where major problems occur.
 When the project is completed.
 When auditing has to be conducted.

9.5.1 Review after Submission of Project Proposal


A review at this point would help the project manger to know whether – the
proposal is worth the resources on undertaking an initial investigation; the
proposal is in keeping with the existing business strategy; and the proposal is
flexible, in case it does not comply with the existing business strategy.

9.5.2 Review in the Implementation Phase


There are different types of reviewing techniques to monitor the project in the
implementation phase. Status reviews, design reviews, and process reviews are
carried out during this phase of the project.

9.5.3 Review at the Time of Completion of Project


A project is closed either when it accomplishes its objectives (successful project)
or when it fails to do so. Closing a project is a formal activity aimed at
discharging all the assets belonging to the project in a proper manner. The
project manager conducts a review at this stage to

 Evaluate the project efficiency by comparing the delivered output with the
planned one, in terms of time, cost and performance standards.
 Ensure that the benefits are well documented for use in future projects.
 Document the lessons learnt as these may be helpful in the management of
future projects.

9.5.4 Review in the Post-implementation Stage


This kind of review is usually conducted any time between three to six months
after the completion of the project. The project manager undertakes the review to
judge whether the project was successful in meeting its goals or not. These
reviews should;

 Evaluate the benefits of the project and compare them with the benefits
envisaged in the initial plan
 Judge the effectiveness and efficiency of the delivered output of the project
when it is put to use in real-life situations
 Suggest corrective measures, if necessary

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Project Review

 Document the lessons, as these may prove helpful in managing future projects
 Be conducted keeping in mind the information requirements of the various
stakeholders, like the sponsor of the project, the functional departments, the end-
users and the clients.
Post project reviews have a special significance in project management.

Example: Significance of Post Project Review


Project review is probably the most effective tool for improving project
results and project management practices. An effective and thorough review
of project performance can help the project manager find out what was right
and what was wrong about the conduct of the project. Project reviews should
be target oriented and realistic i.e., they should be conducted efficiently and
lay emphasis on overall project goals and objectives. To sum up, post project
reviews should analyze the performance of the project so as to build on the
project achievements and avoid problems in the future. Post project reviews
help evaluate the performance of the project from various perspectives:
1. Was the project a total success?
2. Was it a well defined project?
3. Did the project deliver the expected results?
4. Was the project implemented according to established project
management policies and procedures?
5. Was the progress of the project monitored and controlled properly?
6. Was the project a success from the stakeholder’s point of view?
7. Is the project team happy with the performance of the project?
Every project has some valuable lessons for improving future projects and
developing professional skills. Post project reviews help uncover those
valuable lessons.
Adapted from www.ittoolkit.com/pmreview_intro.htm.

Check Your Progress


11. Projects are reviewed at the post-implementation stage usually between
three and six months after the completion of the project. Which of the
following stages of project review falls under the post-implementation stage
of the project?
a. When auditing is to be conducted
b. When the major output of the project is to be delivered
c. At the point where major problems occur
d. None of the above
12. At which of the following points in the implementation stage is the project
review not taken up?
a. Before entering into major contracts.
b. At points where the risk is substantially high.

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Project Planning and Control

c. At points where major problems occur.


d. When there are any minor difficulties in the project implementation.
13. Which of the following are the stages at which project review is to be
conducted?
i. During the initial stages, after the project proposal has been submitted.
ii. At the stage when in-depth evaluation is conducted.
iii. During the implementation of the project.
iv. When auditing has to be conducted.
a. Only i and ii
b. Only iii and iv
c. i, ii, and iii
d. i, ii, iii, and iv

9.6 Project Status Review Meetings


Meetings are an effective and essential means of conducting project reviews in
an organization. These meetings are aimed at reviewing the project status and
have a specific agenda. At these meetings, decisions are made, different aspects
of the project are discussed and the work is planned and scheduled. Project
managers usually use a top-down approach for conducting a project status
review meeting. The sequence of events at a review meeting is generally as
follows;
1) The project leader presents the changes in the project scope that may have
an impact on its future
2) The client presents the changes in the project that may have an impact on its
future
3) The project manager presents the status of the project, with a note on the
impact of changes that were considered or approved earlier
4) Activity managers present the progress since the last status meeting
5) Activity managers of future activities present the changes having an impact
on the project status since the last meeting
6) The project manager checks the status of the problems that remained
unresolved at the previous meetings
7) Members present in the meeting explore new problem areas and assign
responsibility for solving these problems.
8) Closing comments are made by the project leader, the client or the project
manager
9) The project manager closes the meeting after announcing the venue, date
and time of the next review meeting.
The following aspects have to be decided upon before holding a review meeting
-- frequency of meetings, preparing agenda, meeting coordinator, and recording
and distributing minutes.

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9.6.1 Frequency of Meetings


If the activity manager submits his report to the project manager on a weekly
basis, and the project manager in turn submits his report to senior management
on a biweekly basis, project status review meetings may be conducted once in
two weeks. But there is no hard and fast rule about the frequency of meeting.
The frequency is usually based on the length and duration of the project.
Meetings must not be held too frequently as this leads to waste of time. At the
same time if the review meetings are infrequent, the project manager may lose
control over the project. The project manager must therefore exercise his
judgment while deciding the frequency of meetings.

9.6.2 Preparing Agenda


The agenda lists the issues that are to be discussed at the meeting. It helps the
project manager to ensure that every one participates in the discussion. The
agenda should not have many topics for discussion. If the agenda provides
background information for each topic that is listed, participants can come better
prepared for the meeting. Depending on the importance of a topic, the agenda
specifies a time limit for discussing the topic.

9.6.3 Meeting Coordinator


The meeting coordinator fixes the place and time for the meeting and arranges
for the required equipment. While deciding the time and the arrangements for the
meeting, the coordinator must consider the following;

 Is the room big enough to accommodate all the participants? The room should
neither be too small nor too large.
 The convenience of the place.
 Are the seating arrangements comfortable? Can additional seats be provided if
required?
 Does the room have proper light and ventilation?
 Are the visual aids working properly?
 Is additional stationery available?
 Are name plates required?
 Handling of messages.
Once these aspects have been taken care of, the preparation for the meeting are
over. Let us now see how a review meeting should be conducted.
Before starting a review meeting it is the responsibility of the project manager to
respect the protocol. The following measures/precautions have to be taken to
avoid the problems arising out of breach of protocol.

 Participants must be given enough notice and the agenda given to them must
contain background information about the topics that are to be discussed

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Project Planning and Control

 The heads of the relevant departments must be informed about the requirement
of expert subordinates
 New comers must be introduced to the other members before the meeting starts
 Participants must be listed in alphabetical order
 Significant contributions made by persons inside and outside the group must be
acknowledged
 Participants must be informed well in advance if the meeting is being postponed
or being canceled.
Once the meeting gets underway, it is the responsibility of the project manager
to encourage discussion, seek the opinions of all the participants and before
concluding the meeting, to summarize what was discussed at the meeting. The
project manager must ensure;

 That all the participants have a clear understanding of the objectives of the
meeting.
 That a time limit for the entire meeting has been set in the agenda and that this
time limit is made known before the meeting begins.
The meeting will be a success if all the participants agree upon the objectives
from the same point of view. The leadership skills of the project manager and
cooperation among the participants determine the success of the review
meetings. The project manager and the participants should;

 Get acquainted with other participants before the meeting starts


 Allow other participants to come out with their ideas and recommendations
 Carefully listen to the views of other participants
 Welcome new ideas that support the objectives of the meeting
 Help in arriving at a consensus
 Be flexible enough.
Even if all efforts are made to make sure the meeting goes on smoothly, a
number of problems may arise. Participant’s inability to reach a consensus on the
objectives of the meeting is a major problem. Another key problem is the
difficulty participants face in communicating effectively with one another, due to
differences in age, rank, status etc. Sometimes participants tend to spend too
much time trying to solve a single problem. If this happens, the project manager
should intervene in the discussion and make sure that things go according to
schedule. When participants fail to arrive at a decision, the project manager must
help them sort out their differences and encourage them to reach a decision
before the meeting concludes. While closing the meeting, the project manager
should present a summary of the discussions and thank all those who made
significant contributions to the meeting. A follow up should be done to make
sure the decisions taken at the meeting are implemented.

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Project Review

9.6.4 Recording and Distributing Minutes


The minutes of a meeting form an important part of the project documentation. They
provide proof that certain problems were discussed and certain decisions were
arrived at. Therefore, recording and distributing the minutes is as important as
preparing the agenda.

Check Your Progress


14. Which of the following will be the correct sequence of a typical project
status review meeting?
i. The project leader outlines the changes in the project that may have an
impact on its future.
ii. Activity managers present a report of the progress since the last status
meeting.
iii. The project manager checks the status of the problems that remained
unsolved at the previous meetings.
iv. Members present at the meeting explore new problem areas and assign
responsibility for solving these problems.
a. i-ii-iii-iv
b. ii-i-iii-iv
c. ii-i-iv-iii
d. i-iv-iii-ii
15. Based on which of the following factors is the frequency of holding the
project review meetings decided?
a. Length and duration of the project
b. Budget allotted for the project
c. Availability of venue for holding the meetings
d. None of the above
16. Which of the following are specified by the agenda of the meeting?
a. Duration of the meeting.
b. Time limit for discussing each of the topics.
c. The scope of discussion of the topics.
d. None of the above
17. Who among the following decides on the time of the meeting and makes the
arrangements for it like fixing the place and arranging the required
equipment?
a. Project manager
b. Meeting coordinator
c. Project member
d. External facilitator

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18. Which of the following aspects have to be decided upon before a review
meeting is held?
v. Quorum for the meeting
vi. Frequency of the meeting
vii. Location of the meeting
viii. Recording and distributing minutes
a. Only i and iii
b. Only i, ii and iv
c. Only ii and iv
d. i, ii, iii and iv
19. Which of the following involves the recording of the proceedings of the
project status review meetings and forms an important part of the project
documentation?
a. Preparing agenda
b. Recording and distributing minutes
c. Status reviews
d. Design reviews
20. Reviewing the __________ is the purpose of holding the project review
meeting.
a. project budget
b. project status
c. project design
d. project duration
21. The _________ lists the issues that are to be discussed at the meeting.
a. minutes
b. agenda
c. duration of the meeting
d. time
22. Which of the following aspects need not be considered by the meeting
coordinator when deciding on the time and arrangements for the meeting?
a. The convenience of the place.
b. Whether the seating arrangements are comfortable.
c. Whether the visual aids are working properly.
d. The proximity of the meeting place to the project site.

9.7 Advantages of a Project Status Review Meeting


Apart from allowing participants to share information and make decisions, a
project status review meeting also gives the project manager a chance to – make
the team more cohesive; keep the team informed about project’s progress;
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Project Review

identify potential problems; make sure the team has a clear idea of where the
project is going; and ensure that the entire team is willing to put in their efforts
to meet the project objectives.

Activity: Ganesh Ahuja joined a software development firm as assistant


project manager. He is assigned to work under the senior project manager
Shreenivas Raju, on a telecommunication software project. The project was
half-way through when Raju called for a review meeting. And unexpectedly
Raju was sent to New Jersey to handle another project (on which he was the
project manager). So, the responsibility of conducting the review meeting was
handed over to Ahuja, who had no previous experience in conducting review
meetings. Think yourself as a senior project manager in the firm and advice
Ahuja on how to conduct a review meeting. Explain to him the advantages of
conducting review meetings.
Answer:

9.8 Types of Project Status Meetings


Project status meetings keep the participants informed about the project’s
progress. These meetings are usually attended by the representatives of senior
management, the project manager, the client and the key members of the project
team. These are the people who should be kept informed of the project progress.
In the case of projects that are geographically dispersed, or projects in which
different activities are being taken up in two different locations, it may not be
possible for the project manager to bring all the parties involved under one roof
to hold the traditional project review meeting. In such situations modern
communication technology can be used to conduct meetings. Such meetings
could either be long distance status meetings, which allow two-way
communication or meetings conducted through a “visibility web-site” which
allows only one-way communication.

9.8.1 Long Distance Status Meetings


These meetings enable two-way communication between the parties involved
through audio conferencing or video conferencing. These meetings need a high
amount of formality to ensure that all the topics in agenda are addressed. To
make sure that all the topics in the agenda are discussed at these meetings and to
keep track of all the parties involved, a structure called ‘Open Job Report’ is
prepared.

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Project Planning and Control

9.8.2 Visibility Websites


A visibility website allows one-way communication between the project
manager and the parties involved. This is the best way to keep people informed
about the project developments. This information is available across the globe
through a Uniform Resource Locator (URL). The most significant aspect of
visibility website is its ability to link team members spread across different
geographical locations.

Check Your Progress


23. Which of the following allows a one-way communication between the
project manager and parties who are geographically dispersed?
a. Long distance status meetings
b. Project review
c. Visibility website
d. None of the above
24. __________ is prepared to ensure that all the topics on the agenda are
discussed and to keep track of all the parties involved.
a. Open Job Report
b. Visibility web site
c. Agenda
d. Process review
25. Which of the following enable/s two-way communication between the
parties involved in the project through audio and video conferencing?
a. Visibility website
b. Long distance status meetings
c. Project status review meetings
d. None of the above

9.9 Summary
 Once the project enters the implementation phase, the project manager should
review the status of the project in a timely and phased manner. Project reviews
conducted at various stages of project implementation play a major role in the
success of a project.
 Reviews are conducted to find out if the project can accomplish the business
goals; whether the rules of the organization are understood properly and
implemented; if it is worthwhile to take up the project at all before entering into
major contracts; and whether the project is managed effectively, and the team
members are sure of completing the project by following the guidelines.
 A project manager has to conduct various reviews throughout the life of a
project to ensure that it is progressing towards achieving the planned objectives.
Generally, a project manager conducts three types of reviews – status reviews,
design reviews, and process reviews.

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Project Review

 A review should always be conducted before taking any major decisions that
can affect the future of the project. Reviews can be conducted during the various
stages of the project life cycle such as initial stage, implementation stage, and
closing stage.
 Meetings are an effective and essential means of conducting project reviews in
an organization. Project status review meetings are aimed at reviewing the
project status and have a specific agenda. At these meetings, decisions are made,
different aspects of the project are discussed, and the work is planned and
scheduled.
 Project status meetings keep the participants informed about the project’s
progress. These meetings are usually attended by the representatives of senior
management, the project manager, the client and the key members of the project
team.
 Project status meetings could either be long distance status meetings, which
allow two-way communication or meetings conducted through a “visibility
web-site” which allows only one-way communication.

9.10 Glossary
 Agenda: Lists the issues that are to be discussed at the meeting and process
reviews are used to determine whether the processes are going as planned.
 Comprehensive reviews: These are conducted monthly basis as part of the
status reviews. Status reviews and process reviews are not done at any fixed
milestones, but are conducted frequently to know the status and process of the
project.
 Cursory reviews: These are conducted as a part of the status review on a
weekly basis.
 Design review: The review conducted at the major milestones of project
implementation to ensure the performance quality of the project deliverable.
 Long distance status meetings: Enable/s two-way communication between the
parties involved in the project through audio and video conferencing.
 Open job report: A structure prepared to ensure that all the topics on the
agenda are discussed at these meetings and to keep track of all the parties
involved.
 Visibility websites: One-way tools that help the project manager communicate
with parties situated at distant places.

9.11 Self-Assessment Exercises


1. As the project enters the implementation phase, the project manager should
review the status of the project in a timely and phased manner. Explain the
importance of conducting a project review.
2. A project manager has to conduct various reviews throughout the life of a
project to ensure that it is progressing towards achieving the planned
objectives. What are the different types of project reviews conducted by a
project manager?

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Project Planning and Control

3. A project review should be conducted before taking any major decisions that
can affect the future of the project. What are the different stages in the
project life cycle at which a project manager can conduct project reviews?
4. Meetings are an effective and essential means of conducting project reviews in
an organization. What are these meetings? Describe the advantages of
conducting these meetings. What are the various ways in which these meetings
can be conducted?

9.12 Suggested Reading/Reference Material


1. Prasanna Chandra, “Projects,” McGraw Hill, Seventh Edition, 2009.
2. Robert K. Wysocki, “Effective Project Management: Traditional, Agile,
Extreme,” Wiley India, 2009.
3. Jack R. Meredith and Samuel J. Mantel Jr., “Project Management: A
Managerial Approach,” Sixth Edition, Wiley India, 2008.
4. Harold Kerzner, “Project Management-A Systems Approach to Planning,
Scheduling and Controlling,” Second Edition, 2006.
5. “A Guide to the Project Management Body of Knowledge,” Project
Management Institute, Second Edition, December 2000.
6. Joseph Weiss and Robert K. Wysocki, “Five-phase Project Management: A
Practical Planning and Implementation Guide,” Basic Books, 1992.

9.13 Answers to Check Your Progress Questions


Following are the answers to the Check Your Progress questions given in the
Unit.
1. (c) Only i, iii, and iv
The purpose of the project review is to know whether the project can
accomplish the business goals, whether the rules of the organization have
been understood and will be implemented properly, whether it is worthwhile
taking up the project at all before entering into major contracts, whether the
project is being managed effectively, and whether the team members are
sure of completing the project by following the guidelines laid out. It is not
one of the purposes of the project review to determine whether the project is
exceeding the budget limits set by the manager. But the results of the review
will help the management to evaluate the cost of the project.

2. (d) i, ii, iii, and iv


The project review helps the manager in keeping in mind the purpose of
carrying out the project, determining the appropriateness of the project
activities from time to time, gauging the way in which the objectives are
being accomplished, verifying the completion of the project, evaluating the
cost of the project, and understanding the project requirements.

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Project Review

3. (c) American National Standards Institute


The design review criteria developed by the American National Standards
Institute help in the design review of the projects.

4. (b) status reviews.


Status reviews are conducted at fixed intervals to review the present position
of the project. Generally, a cursory review is done every week and a
comprehensive one every month to review the status of the project. But the
frequency with which the reviews are conducted may vary depending on the
frequency with which problems occur. Design reviews are conducted to
check whether the design of the product or service being produced is of
expected quality and the process reviews are conducted to determine
whether the processes are going as planned and whether any improvements
are possible.

5. (d)Design review
Design review refers to the review conducted at the major milestones of
project implementation to ensure the performance quality of the project
deliverable. Design review is the tool to review the performance factor of
the project. Comprehensive review is done on a monthly basis as part of the
status reviews. Status reviews and process reviews are not done at any fixed
milestones, but are conducted frequently to know the status and process of
the project.
6. (c) Process reviews
Process reviews are sometimes conducted by external facilitators rather than
the project manager himself/herself. This is because the team members may
not feel free to be critical about the leadership skills of their project
manager, leadership being one of the processes crucial for the success of the
project. Cursory reviews and comprehensive reviews, which are part of
status reviews, are generally conducted by the manager himself/herself.

7. (b) iii-ii-i
The steps in the problem-solving process are: Identifying the existing
problems, identifying the factors that cause problems, and exploring
solutions that can solve the problems.

8. (b) cursory review.


Cursory reviews are done as a part of the status review on a weekly basis.
Comprehensive reviews, also a part of the status reviews, are done on a
monthly basis. Design reviews are conducted to check whether the design of
the product or service being produced is of the expected quality and process
reviews are conducted to determine whether the processes are going as
planned and whether any improvements are possible.

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Project Planning and Control

9. (c) Only ii and iii


The main objective of conducting a project review is to determine whether
the processes are going on as planned and whether any improvements are
possible. The two objectives of process reviews are: To preserve the
performance of project processes that are going well and to improve the
processes that are below standard. Reviewing the financial performance of
the project and the safety of the operators and maintenance personnel are not
the objectives of process reviews.
10. (c) Control of costs in project implementation
The design review covers only the performance aspects of the project
implementation like manufacturability, serviceability, tooling, economics of
special machinery, safety of operators and maintenance personnel,
precautions taken to minimize damages, etc. It doesn’t cover the cost, time,
and scope of the project.
11. (a) When auditing is to be conducted
The projects are reviewed at the post-implementation stage three to six
months after the completion of the project and during the conduct of audit of
the project. The other two options: when the major output of the project is to
be delivered and at the point where major problems occur do not fall under
the post-implementation stage of the project.
12. (d) When there are any minor difficulties in the project
implementation.
The project review is conducted at the implementation stage of the projects
at the following points: Before entering into major contracts, when the
major output of the project is to be delivered, when the risk is substantially
high, and when major problems occur.
13. (d) i, ii, iii, and iv
The important points or stages at which a review is conducted are as
follows: In the initial stages of the project life cycle, at the stage when an in-
depth evaluation is conducted, during the implementation of the project,
when the project is completed, and when auditing has to be conducted.
14. (a) i-ii-iii-iv
The sequence of events at a review meeting are: The project leader presents
the changes in the project that may have an impact on its future, the client
presents the changes in the project that may have an impact on its future, the
project manager presents the status of the project accompanied by a note on
the impact of changes considered earlier, activity managers present a report
of the progress since the last status meeting, activity managers of future
activities outline the changes that have had an impact on the project status
since the last meeting, the project manager checks the status of the problems
that remained unresolved at the previous meetings, members present at the
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Project Review

meeting explore new problem areas and assign responsibility for solving
these problems, the project leader, the client, or the project manager makes
closing comments and the project manager closes the meeting after
announcing the venue, date, and time of the next review meeting. The
activity manager presents the progress since the last status meeting to the
members present at the meeting exploring new problem areas and assigning
responsibility for solving these problems.

15. (a) Length and duration of the project


The frequency of holding meetings is decided based on the length and
duration of the project. This is because meetings held more often than
necessary lead to wastage of time. The budget allotted and the availability of
venue for holding the meetings are not factors which determine the
frequency of holding project review meetings.

16. (b) Time limit for discussing each of the topics.


The agenda of the meeting specifies the time limit for discussing each of the
topics, depending upon the importance of the topics. The duration of the
meeting and the scope of discussion of the topics at the meetings are not
specified by the agenda of the meeting.

17. (b) Meeting coordinator


The meeting coordinator fixes the place and time for the meeting and
arranges for the required equipment. The project manager and project
member do not decide upon the time and arrangements of the meeting. The
external facilitator is used in the process reviews of the project.

18. (c) ii and iv


The aspects that are to be decided upon before a review meeting is held are:
Frequency of meetings, preparing the agenda, meeting the coordinator, and
recording and distributing minutes. It is not necessary to decide upon the
quorum for the meeting and the location before holding the review meeting.

19. (b) Recording and distributing minutes


Recording and distributing minutes forms an important part of project
documentation and provides evidence regarding the problems which were
discussed and the decisions arrived at in the review meeting.

20. (b) project status


Organizing meetings is an effective way of conducting project reviews in
the organization. The meetings will have a specific agenda of reviewing the
status of the implementation of the projects. Reviewing the project budget,
project design, and project duration are not the purposes for which a project
review meeting is held.

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21. (b) agenda


The agenda of the meeting lists out various issues that are to be discussed at
the meeting. The minutes of the meeting are prepared after the meeting has
been conducted.

22. (d) The proximity of the meeting place to the project site.
The coordinator must consider the following while deciding on the place
and time of the meeting: Whether the room is big enough to accommodate
all the participants of the meeting, the convenience of the place, whether the
seating arrangements are comfortable, whether the room in which the
meeting is to be held has proper light and ventilation, whether the visual
aids are working properly, whether additional stationery and name plates are
required, and how messages are to be handled in the meeting.

23. (c) Visibility website


The visibility website is a tool which enables a one-way communication
between the project manager and the parties involved.
24. (a) Open Job Report
Open job report is the structure prepared to ensure that all the topics on the
agenda are discussed at these meetings and to keep track of all the parties
involved. Visibility websites are one-way tools that help the project manager
communicate with parties situated at distant places. The agenda lists the
issues that are to be discussed at the meeting and process reviews are used to
determine whether the processes are going as planned.

25. (b) Long distance status meetings


Long distance status meetings enable two-way communication between the
parties situated at distant places through audio and video conferencing. The
visibility website only allows one way communication between the project
manager and the parties involved. Project status review meetings are held if
the participants have geographical proximity.

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Unit 10
Project Control
Structure
10.1 Introduction
10.2 Objectives
10.3 The Fundamentals of Project Control
10.4 The Objectives of Control
10.5 Reasons for Measuring Duration and Cost Deviations
10.6 Control as a Function of Management
10.7 Control vs. Risk
10.8 Balancing the Control System
10.9 Control of Change and Scope Creep
10.10 Progress Reporting System
10.11 Types of Project Status Reports
10.12 Graphical Reporting Tools
10.13 Project Status Review Meetings
10.14 Managing Risk
10.15 Managing Quality
10.16 Summary
10.17 Glossary
10.18 Self-Assessment Exercises
10.19 Suggested Reading/Reference Material
10.20 Answers to Check Your Progress Questions

10.1 Introduction
In the previous unit, we have discussed about project review. In this unit, we will
discuss about project control. Project control is the process of collecting
information related to the performance of the project system, comparing it with
the desired level of performance and taking corrective action to decrease the gap
between the actual and the desired performance levels. The basic purpose of
project control is to control and manage change. Project control is not a separate
phase in itself but it goes hand in hand with the project implementation phase.

As the project progresses, the project manager gathers all the information
pertaining to project status from its team members and the clients. The
information gathered has to contain the progress made, percentage of work
completed and predictions indicating the possible date of completion. This is the
Project Planning and Control

right period for getting inputs on changes in activity dependencies and to decide
on the inclusion or exclusion of activities from the plan. The information
gathered can be analyzed to find out variances, to examine the total performance
of the project and to prepare monthly sales reports. The significant areas to look
out for variances are scope of the project, project schedule and resource
utilization.

An effective project management system is one which puts in place a well


organized control system at the time of project planning. Once the project enters
the execution phase, it is the responsibility of the project manager to check
whether the actual output matches with scheduled/desired level of output. The
parameters to be used are performance, time and cost. A project control system
helps in fixing problems in time and in putting the system back in shape. The
idea behind implementing a project control system is “A stitch in time saves
nine”. A project control system is a corrective, evaluating tool to minimize the
risk and cost of project deviations that may lead to project failure.

This unit will deal with the fundamentals of project control. We will discuss the
objectives of control, control as a function of management, and the difference
between control and risk. We will also discuss the reasons for measuring
duration and cost deviations, and understand the ways to balance the control
system, and control change and scope creep. We shall then move on to discuss
progress reporting system and describe the various types of project status
reports. We will also discuss about the graphical reporting tools and project
status review meetings. Finally, we would be discussing the different ways to
manage risk and quality.

10.2 Objectives
By the end of this unit, students should be able to:

 explain the fundamentals of project control.


 define the objectives of control.
 discuss the reasons for measuring duration and cost deviations.
 recognize control as a function of management.
 differentiate between control and risk.
 identify ways to balance the control system.
 determine ways to control change and scope creep.
 define progress reporting system.
 recognize the various types of project status reports.
 list the graphical reporting tools.
 discuss project status review meetings.
 find out different ways to manage risk and manage quality.

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Project Control

10.3 The Fundamentals of Project Control


Project controls are tools developed to diagnose the system for deviations from
the actual plan and reset them back with the actual plans/schedule. Project
controls are required to check whether the project is progressing in accordance
with the plans and standards set during the planning phase. In fact, the project
controls are measures taken by the project manager in order to minimize the gap
between the planned output and the delivered output.
Answering the following questions will help us in designing an effective control
system:
 Who sets the standards?
 How realistic are the set standards?
 How clear are the standards?
 Do these standards achieve the project’s goals?
 What are the outputs and behaviour that need to be monitored?
 Is monitoring of people required?
 What kind of sensors are to be used?
 Where should the sensors be placed?
 How frequently should the monitoring be done?
 What should be the tolerable gap between the actual and the planned output
before taking the corrective measures?
 What are the corrective measures available to take corrective action if needed?
 How ethical are these corrective measures?
 What rewards and penalties can be used to get the desired results?
 What kinds of actions are to be taken and by whom?
An effective control system is one that appears sensible and acceptable to those
who use it and those who are controlled by it.

10.3.1 Characteristics of an Effective Control System


For a control system to be effective and efficient, it should fulfill the following
requirements:
Comprehensiveness: The control system should give a detailed overview of the
work to be performed. It has to estimate the time, labor, and costs required to
finish the project.
Communicability: The system should communicate the scope of the project.
Authenticity: The system should reflect budgetary discipline and authentic
expense tracking by accounting tangible progress and cost expenditure in time.
Timeliness: The control system should be able to frequently re-analyze the cost
and time required for the completion of the remaining work. This is done by
comparing the delivered output with the actual/scheduled output in terms of
performance, cost and time thereby rendering the system cost effective.

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Project Planning and Control

Simplicity: The system should be simple to operate.


Flexibility: The system should be open to extensions and alterations and it
should also be easy to maintain.
Morally sound: The system should conform to all the ethical standards.

Check Your Progress


1. Which of the following characteristics of an effective project control system
refers to budgetary discipline and expense tracking by accounting tangible
progress and cost expenditure in time?
a. Comprehensiveness
b. Simplicity
c. Authenticity
d. Moral soundness
2. It is the duty of the project manager to ensure that the actual output matches
the desired output. Which of the following parameters should be used to
ensure that this is monitored properly?
i. Performance
ii. Time
iii. Price
iv. Cost
a. Only i
b. Only i, ii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
3. Which of the following options involves the process of collecting
information related to the performance of a project, comparing the
performance with the desired levels of performance, and taking corrective
action if there is any gap between the actual and desired levels?
a. Project review
b. Project control
c. Project risk management
d. None of the above
4. Project controls are required to check whether the project is progressing in
accordance with the standards set during the planning phase. Which of the
following is a characteristic of an effective project control system?
i. Comprehensiveness
ii. Authenticity
iii. Timeliness
iv. Moral soundness
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Project Control

a. Only i
b. Only i, iii and iv
c. i, ii, iii, and iv
d. Only ii, iii, and iv
5. Which of the following characteristics of project control means that the
system is open to extensions and alterations and is easy to operate?
a. Comprehensiveness
b. Flexibility
c. Simplicity
d. Moral soundness

10.4 The Objectives of Control


The primary objective of control is regulation. The purpose is to monitor the
delivered output by comparing it with the actual/scheduled output suggested in
the planning phase. The regulatory function of control helps in – translating the
objectives into performance standards that are represented by program activities
and events; and formulating budgets in order to compare the delivered output
with the actual/scheduled output.
The secondary objective of control is conservation of resources. The project
manager is entrusted the responsibility of protecting the physical, human and
financial resources of the organization. The process of guarding each of these
three assets is different. Resource control involves evaluating the utilization
factor of resources. Human resource control tries to determine whether the
individuals are capable of the efforts required to finish the task on time. It is
hardly possible to dedicate the resources totally to a specific project. When the
human resources are shared between the projects, some projects may not be able
to achieve its objectives due to mismanagement or misallocation of their
personnel.
Physical asset control is the process of controlling the use of physical assets. It
includes the preventive or corrective maintenance of the assets. A project
manager has to schedule the maintenance/ replacement plan in a way as to
minimize interruption to the work in progress and without overlooking the
quality aspect. Controlling the inventory is also a key aspect that involves
receiving, inspecting, storing and recording to ensure genuine payment to
vendors. This also involves proper material handling techniques.
Human resource control is the process of controlling and maintaining the growth
and development of the human capital of the organization. Unique projects
enable people gain rich experience within a short period of time. Conserving
human resource is therefore a significant aspect of the control system.

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Project Planning and Control

Financial resource control is a combination of regulatory and conservatory


functions. The conservatory function of control on capital investments requires
the meeting of certain conditions before investments are made. The same
conditions also regulate capital flows for a higher return on investment. The
regulatory and conservatory techniques of financial resource control consist of a
control on current assets and project budgets along with capital investments.
These controls are implemented through a series of analysis and audits by the
controller or the project manager.
The tertiary objective of project control is to facilitate decision-making.
Effective decision-making by the management requires the following reports:

 A report comprising the plan, schedule and budget made during the planning
phase.
 Data consisting of the comparison between the resources spent in order to
achieve the delivered output and the scheduled output. This report should also
include an estimation of the remaining work.
 An estimate of the resources required for the completion of the project.
These reports that are submitted to the project managers and team members are
useful in the following manner:

 They provide feedback to the management, planners and team members.


 They identify the deviations from the scheduled plan.
 They implement a contingency plan at an early stage in order to protect the
project from higher losses due to cost, performance and time overruns.
10.4.1 Need to Control Performance, Time, and Cost
Talking of control always brings three parameters into the discussion: the
performance, the cost and the time of a project. These three aspects are of utmost
importance to any project manager because he is answerable to the client. This
makes the project manager to check whether the project is progressing as per the
expectations and if it is operating within the time frame and budget. The need to
control the performance, cost and time arises from this.
Controlling Performance
It is necessary to control performance because technical problems may spring up
any moment; resources may become scarce; complicated technical snags may
develop; quality problems may arise; the client may request for changes in the
system specifications; inter functional complications may arise; and
technological breakthroughs can also affect the project.
Controlling Costs
Some of the reasons that necessitate cost control are – more resources are
required to solve the technical problems; cost of the project increases
proportionately with the scope of the project; low estimations were given
initially; poor reporting structures; inappropriate budgeting; failure to put a
corrective measure in place in time; and change in the prices of inputs.

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Project Control

Controlling Time
Some of the reasons that necessitate time control are – solving a technical snag
may require more time than estimated; time estimations that were done initially
were very optimistic; tasks were inappropriately sequenced; shortage of material,
personnel or equipment when required; incomplete preliminary tasks that were
necessary to complete a series of activities; and changing government
regulations.

Check Your Progress


6. The project manager is entrusted with the responsibility of protecting the
physical, human, and financial resources of the organization. ___________
is the objective of project control which deals with the protection of these
resources.
a. Conserving the resources
b. Regulation
c. Facilitating decision making
d. None the above
7. Which of the following options reflect the primary, secondary, and tertiary
objectives of a control system in an order?
a. Facilitating decision making, conserving resources, and regulation
b. Conserving resources, facilitating decision making, and regulation
c. Regulation, conserving resources, and facilitating decision making
d. None of the above

10.5 Reasons for Measuring Duration and Cost Deviations


Before going into the reasons behind measuring duration and cost deviations, it
is necessary to talk about variances and kinds of variances. Variances are
deviations from the actual plan. Based on the parameters of time and cost,
variances can be classified into Positive variances and Negative variances.
A positive variance is one in which the delivered output is ahead of the planned
schedule or the cost incurred is less than the planned cost. Though positive
variances are good news for the project managers, they can be as threatening as
negative variances. Positive variances are capable of advancing the project
completion date and allocating lesser resources than estimated. However, these
variances can also occur as a result of missing an activity that was supposed to
be completed during the reporting period. It needs to be examined thoroughly
before reporting a positive variance.
A negative variance is one in which the delivered output is behind schedule or
the cost incurred is more than the planned cost. The project manager would want
a detailed report on the schedule accomplished and the costs incurred, along with
the reasons for the delay.
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Project Planning and Control

It is important to measure duration and cost deviations because they play a


significant role in the project management life cycle. Though all the parameters
of project management have their own levels of significance, time and cost share
a special place.

10.5.1 Identifying Deviations from the Curve Early

When the project manager plots the actual performance or cost curve against the
planned performance or cost curve, he may observe some deviation between the
curves. This deviation between the curves cautions the project manager about
cost and performance overruns. This enables the project manager to initiate
timely corrective measures to minimize the deviations.

10.5.2 Dampen Oscillation

A constant, continuous and identical pattern should be displayed by curves


representing the actual and the planned performance over time. Projects with
high fluctuations over time result in many bottlenecks in the project life cycle
like running behind schedule, overspending during one phase and going out of
control in the next phase. Measuring deviations would help the project manager
in taking timely corrective measures that would nip problems in the bud.

10.5.3 Facilitate Early Corrective Action

A schedule or a cost problem is better reported to the project manager at an early


stage of its development. The project manager has more opportunities for a
corrective action plan when the problem is detected early.

10.5.4 Estimating Weekly Schedule Variance

Weekly reports on the work in progress have to be made, to give the project
manager enough time to take corrective measures before the situation gets out of
control.

10.5.5 Determining Weekly Effort (Person Hrs/Day) Variance

The variance between the planned/scheduled effort and the delivered effort has a
direct impact on the planned cumulative cost and schedule. A lower delivered
effort than the scheduled effort indicates that the potential has not been
optimized i.e., a person failing to enhance his/her effort in the following phases
of the project. However, if the delivered effort is more than the scheduled effort,
where progress is not in proportion with the effort put in, may result in a cost
over run. It is very important to detect the out of control situations early. The
longer one takes to detect a problem, the harder it will be to put the project back
on track.

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Project Control

Example: Reasons for Cost Overruns


During the proposal submission phase
1. Lack of understanding of the client’s requirements.
2. Unrealistic evaluation of internal strengths.
3. Misjudging time requirements for project completion.
During the planning phase
1. Neglecting importance of planning
2. Incorrect work breakdown structure
3. Distortion of Information.
4. Using inappropriate reviewing techniques.
5. Inability to find and focus on the key parameters of the cost
6. Inability to analyze risk
During the negotiation phase
1. Demanding a faster settlement.
2. Settling for a higher cost
During the contractual phase
1. Conflicting clauses in the contract.
2. Different teams for projects and proposals
During the design phase
1. Entertaining change requests from the client without the top
management’s approval.
2. Difficulty in the communicating with the client.
3. Difficulty in conducting meetings on design review.
During the production phase
1. Higher inventory costs
2. Inappropriate specifications of the deliverables
3. Lack of compatibility between the production and engineering functions.
Source: www.projectnet.com.

Check Your Progress


8. Which of the following options refers to the project manager taking timely
corrective action to nip problems in the bud?
a. Facilitating early corrective action
b. Estimating weekly schedule variance
c. Identifying deviations from the curve early
d. Dampening oscillation

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Project Planning and Control

9. Among the following options, what is the type of variance in which the
delivered output is behind the project schedule or the cost incurred is more
than the scheduled cost?
a. Coefficient of variation
b. Positive variance
c. Negative variance
d. None of the above
10. ___________ is the deviation from the actual project plan.
a. Range
b. Variance
c. Coefficient of variation
d. None of the above

10.6 Control as a Function of Management


Project control is generally implemented through people. Any form of control
has a significant impact on human behavior. Because of this, it becomes
necessary to study project control with special reference to people and their
behavior.

10.6.1 The Governance Model in an Organization

The purpose of establishing governance and control across the organizational


hierarchy is to minimize the gap between the delivered schedule, budget and
output of the project and the planned schedule, budget and output. Though the
fundamental purpose of control remains constant - to minimize the deviation
between the actual and planned output- the management function of control
involves developing and implementing control systems to observe people’s
response to various controls.

The various techniques for enhancing creativity and problem-solving through


team work such as Total Quality Management (TQM) and Employee
Involvement (EI) give the team a sense of direction and motivation to achieve a
goal. All these techniques signify control. Control is an inherent part of every
organization. Control helps in achieving and preserving the ethical goal directed
behavior. It is the project manager’s responsibility to implement controls that
instigate only those behaviors that are desirable. It is presumed that the control
system motivates individuals and also affects the levels of motivation.

Individuals may respond to the goal directedness of control systems in the


following manner – through active and passive participation and goal oriented
behavior; through passive involvement to minimize loss; and through active but
negative involvement and resistance.

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Project Control

10.6.2 Types of Control Processes


The process of controlling a project is a highly complex task. The complexity is
more than fixing the problem after waiting for something to go wrong. Control
starts from identifying the points in the project to exert control, knowing what
should be controlled and how to measure it, what should be the tolerable limit of
deviation and how to identify and correct these deviations as they happen.
Project control is used to check the four key parameters time, cost, scope and
performance. There are three basic control mechanisms – cybernetic control,
go/no-go control, and post control.

Cybernetic Control
Cybernetic controls, also known as steering controls, are very common control
systems. Automatic operation is its chief characteristic. A cybernetic control is
like a steering in an automobile that enables the controller to keep the project on
track. Cybernetic controls are generally used to monitor and control tasks that
are carried out more or less continuously, for example, software projects. The
designing of cybernetic controls requires identifying mechanical tasks, based on
the Work Breakdown Structure (WBS).
The operation begins with an input that gets processed into an output. The
sensing unit that monitors the output of the process (that we wish to control)
sends the input to the comparison unit which then compares it with the standards
that are already set. The comparison unit after measuring the variation between
the input and the standard set, sends the output to the decision maker to decide
on the requirement of a corrective action depending on the size of variation. If
the variation is large enough to implement a corrective measure, the decision
maker acts on the processing unit or the input to get it in close congruence with
the set standards.
A cybernetic control system that minimizes the variation from the set standards
is known as a negative feedback loop. The control mechanism in a cybernetic
control system acts in a direction that is opposite to the one in which the
variation moves away from the standard. Also the speed of action of a control is
directly proportionate to the size of variation from the standard.
Cybernetic controls can be classified into three types, depending on the
sophistication of the standards set. A first order control system is a goal-seeking
device. It is a rigid system that seldom allows altering the set standards. The
standards once set can be altered only by an external intervention. For example,
once a standard temperature is set in a thermostat, the air-conditioning systems
operate to maintain it. A second order control system can alter the standards that
are set only in accordance with predetermined rules and regulations. A third
order control system is a flexible goal seeking device. These systems are flexible
enough to alter their standards from time to time, based on the evaluation of the
past performances. These systems can deal with contingencies better than the
rest.

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Project Planning and Control

Information Requirements of a Cybernetic Control System


Every output needs an input that has to be processed. If output here is an
effective cybernetic control system, the inputs required by the project manager
would be information. The information that is required for developing cybernetic
controls is as follows:

 Defining the characteristics of the output that are to be controlled.


 Setting the standards for the defined characteristics.
 Acquiring the sensors that measure the characteristics at a particular level of
precision.
 Transforming the measurements into signals that are to be compared with the set
standards.
 Detecting the difference between the output and the standard set. If the variation
is large enough, the decision maker should act on the processing unit in such a
way that it tries to bring the output in close congruence with the set standards.
A cybernetic control system is most effective in keeping track of a system and in
notifying the project manager automatically when the output starts deviating
from the set standards.

Activity: George Erix, the COO of a project management firm, wants to


revise the firm’s control mechanisms for a new project – erecting a
manufacturing facility at a new steel plant. Freddy Fernandez, a senior project
manager, is asked to develop control mechanisms right from scratch. Identify
and describe the control mechanisms that Fernandez can incorporate in the
project. What type of information do these mechanisms require?
Answer:

Check Your Progress


11. From the following options, identify the type of control whose chief
characteristic is automatic operation.
a. Go/No-go control
b. Post control
c. Cybernetic control
d. None of the above

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Project Control

12. In the negative feedback loop cybernetic control system, the speed of action
of control is ________ proportionate to the size of variation from the
standard.
a. inversely
b. directly
c. conversely
d. None of the above
13. Cybernetic controls can be classified into various types depending upon the
sophistication of the standards set. Which of the following control system is
a flexible goal-seeking device?
a. First order controls
b. Second order controls
c. Third order controls
d. Fourth order controls
14. Individuals can respond to the goal directedness of control systems in
various ways. Which among the following is/are the ways through which
individuals respond to goal directedness of the control system?
i. Through active and passive participation and goal-oriented behaviour.
ii. Through passive involvement to minimize loss.
iii. Through active but negative involvement and resistance.
a. Only i
b. Only ii and iii
c. i, ii, and iii
d. Only i and ii
15. The setting up of the cybernetic controls requires various types of
information. Of the following, which type of information is not needed for
setting up the cybernetic controls?
a. Setting the standards for the defined characteristics.
b. Defining the characteristics of the output that is to be controlled.
c. Milestones achieved in project implementation.
d. Transforming the measurements into signals that are to be compared
with the set standards.
16. A cybernetic control system that minimizes the variation from the set
standards is known as a __________.
a. negative feedback loop
b. go/no-go controls
c. post controls
d. None of the above

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Project Planning and Control

10.6.3 Go/No-Go Controls

As cost and time overruns may require the organization to pay penalties to the
customer, Go/No-go controls are instituted to check whether the output meets the
preset cost and time standards. These control systems are flexible and apply to all
the aspects of project management. The project plan, budget and schedule are the
control documents that contain preset milestones that act as verification points.
Controls are usually done at the level of detail as mentioned in the project plan,
budget and schedule. The periodicities with which Go/no-go controls are
operated are regular and preset. Preset intervals are decided upon with the help
of calendars or the operating cycles. Because project milestones do not happen
as planned in the calendar, it is advantageous to link these controls to the actual
plans and the happening of real events. But a judicious use of these controls is
advisable. While some parameters of output have to meet a particular standard
range, others may or may not meet the standards precisely.
The major difference between the cybernetic and the Go/No -go control system
is that a cybernetic system functions automatically and continuously, while a
go/no-go system functions only when it is put into application by the controller,
and is periodic.

10.6.4 Information Requirements for Go/No-Go Controls

Setting up an effective Go/no-go control system requires the following


documents:
Project proposal: This document specifies the expected business value (i.e.,
return on investment) along with the cost and time estimates of the project. It
describes what is to be done, who’s going to do it, when is it going to be done
and how. It gives a detailed map of the project. The project proposal describes
the project background, states the objective of the project, and specifies the
approach, the time and the cost requirements of the project.
Project plan: This document gives the ends and means to a particular action or
objective. It describes the ways in which a project can be executed. It is a
decision making tool that enables the project manager choose the best alternative
from different approaches, schedules and resource requirements. A project plan
is an effective tool in the hands of the project manager. An effective project plan
reduces uncertainty and enhances clarity and efficiency of the delivered output.
Project specifications: These are the set of rules and regulations under which the
objectives of the project are met. This document lays down standards that are to
be met by the output of all the processes contained in the project lifecycle.
Project schedule: This document specifies a time frame for each activity.
Project budgets: Cost of the project being a key parameter in the project
management, it needs to be monitored very carefully. Capital is a very scarce
and valuable resource in project management that needs to be monitored closely.
This document gives the estimation of the cost required to finish the project.

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Project Control

Milestones: These are the key parameters that highlight the control activity.
Milestones, which are in the form of output, are delivered by the project. If the
project is able to meet the milestones on time and budget and at a desired quality
level, the project manager can be sure that the project is proceeding smoothly.
10.6.5 Post Controls
These are the control systems that are applied after the completion of the project.
These are also called post project controls or reviews. As George Santayana said
“Those who cannot remember the past are condemned to repeat it”. Thus, while
cybernetic and go/no-go controls help a firm to accomplish the goals of current
projects, post control tries to enhance the firm’s chances of meeting future project
goals, on the basis of lessons learnt in the past projects. A post control report has
the following sections:
The Objectives of the Project
The post control report explains the objectives of the project. It also includes the
effect of change requisitions and their approvals on the project scope. Though the
actual output of the project depends partially on uncontrollable external factors such
as strikes, vendor delays, climatic conditions etc., the assumptions made while
planning the budget and schedule should also be mentioned. Enough care has to be
taken while giving assumptions so that they do not seem to be excuses to cover
failures in the later projects.
Milestones, Checkpoints, and Budgets
This part of the post control report compares the actual project performance with
the plans and points out deviations. This section includes the different status
reports prepared during the project life cycle.
The Final Project Result Report
In this final project result report no distinction is made between positive or
negative deviations while reporting the deviation of actual performance from the
planned performance. The report is focused on the “How” aspect of the deviation
rather than the “What” aspect. This part of the post control report describes the
techniques that were used to plan and direct the project, review the
communication networks and monitoring and control systems used during the
project life cycle and examines the interactions between different work groups.
Recommendations for Performance and Process Improvement
This final section of the post control report contains recommendations for future
projects. Though most of the reasons for deviation are one time events, some of
the reasons are likely to recur and these are the areas that need attention. The
predictability of such events can be improved by psroviding a slot for them in
the project plan. Organizational systems and management techniques that proved
effective in the current project can be used for future projects. Thus post control
has a significant impact on the way future projects are handled. The control
mechanisms are aimed at minimizing the amount of risk involved in managing
projects. However, risk cannot be eliminated totally.

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Check Your Progress


17. Which type of project control mechanisms deal with the ‘How’ aspect of the
deviation rather than the ‘What’ aspect?
a. Cybernetic controls
b. Go/No-go controls
c. Post controls
d. None of the above
18. The setting up of the Go/No-go controls requires various documents. Of the
following, identify the document which is not necessary for setting up the
Go/No-go controls.
a. Project schedule
b. Project plan
c. Project definition statement
d. Project proposal
19. The control systems that are applied after the completion of the project are
called
a. cybernetic controls.
b. go/no-go controls.
c. post controls.
d. negative feedback loop.
20. Post control systems are applied after the completion of the project. From
the options given, identify the sections present in the post control report.
i. Objectives of the project
ii. Milestones, checkpoints, and budgets
iii. The final project result report
iv. Recommendations for performance and process improvement
a. Only i, ii, and iii
b. Only i, iii, and iv
c. Only ii, iii, and iv
d. i, ii, iii, and iv
21. The document which specifies the time frame for each activity in the project
is called
a. project proposal.
b. project plan.
c. project schedule.
d. project budgets.
22. The set of rules and regulations under which the objectives of the project are
met is called
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Project Control

a. project proposal.
b. project plan.
c. project budgets.
d. project specifications.
23. Out of the following control mechanisms, identify the ones applied
periodically.
a. Cybernetic controls
b. Go/No-go controls
c. Post controls
d. None of the above

10.7 Control vs. Risk


Once the project is in the implementation phase, the project manager would like
to make sure that the project is moving ahead according to the plan. A number of
reports are developed that show how closely the project is following the plan.
This makes it easier for the firm to identify and correct deviations. The project
plan being a system may go out of balance any time and hence as a
precautionary measure we require a corrective plan that can bring the system
back to equilibrium. Control systems are designed in such a way that they enable
early detection of problems and a faster implementation of corrective measures.

10.7.1 High Control – Low Risk


Putting in more controls can reduce the risk of the project. But there is a balance
between the amount of control that is achieved by seeking reports and enhancing
their frequency and the protection bought against the out-of-balance situations
that affect the risk unfavorably.

10.7.2 Low Control – High Risk


The project is unlikely to move ahead according to the plan, without proper
control measures in place. Timely detection of problem situations in a project
and the design and implementation of a control plan is critical to a project’s
success. Without control plans, a project runs the risk of being completely
derailed whenever problems occur. In studying the relationship between control
and risk it becomes necessary to know the tools that enable us to strike a balance
between control and risk.

10.8 Balancing the Control System


The greater the control exercised over a project, the less likelihood there is of
project getting into trouble. However, enhancing the frequency of carrying out
the project controls leads to wastage of time in reporting. In order to respond to
the controls exerted, the team members would have to spend time in preparing
reports and answering queries - thereby minimizing the time spent on project
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work. Controls do not come without a cost. Exercising greater control pushes up
the cost of the project and leads to micromanaging events. The project manager
has to decide as to what extent the project has to be controlled. Excessive control
induces rigidity and tends to block creativity. The project manager should
encourage creativity. The cost of control should be measured against its effect on
the team members. Figure 10.1 gives the total cost of control and risk. It depicts
the relationship between risk and control. Conceptually, the balance point
reduces the overall cost liability for choosing a specific degree of control.

Figure 10.1: Total Cost of Control and Risk

A balanced control system has the following characteristics:

 The fact that investment in control and returns are inversely proportional to each
other is to be kept in mind before designing a balanced control system. A linear
increment in the degree of control results in an exponential hike in the cost.
 A balanced control system acknowledges that exerting control beyond a point
would dampen creativity.
 A balanced control system focuses on correcting errors, rather than
punishments.
 A balanced control system exercises only the minimum control that is required
to achieve the project goals.
On the whole, a balanced control system is one that is cost effective and well
equipped to seek the end results. For example treating everyone equally appeals
to a sense of equity, but treating everyone individually would achieve better
results.

10.8.1 Causes of Imbalance


It is important to know the factors that cause imbalances in a control system.
such imbalances could be due to the following reasons:

 Focusing on easy to measure factors, while ignoring intangible factors that are
difficult to measure.
 Laying greater emphasis on short-term results rather than on long-range
objectives.

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Project Control

 Ignoring the organizational goals and structural changes brought about by time
and the circumstances in which the firm operates.
 Exercising too much control.
 When organizations adopt management by objectives employees may ignore
activities that are not considered for measurement.
Implementing a balanced control system is difficult. An important principle that
is often overlooked is the need to relate the controls directly to the project goals.
Also controls should be related to particular performance outputs. The process of
relating controls to the project goals starts by describing the desired outputs as
precisely as possible. Then the potential reasons for deviations are examined,
after which proper controls are developed for these reasons starting with the one
that can cause the highest intensity of deviation.
Striking a balance between the long-term and short-term controls is a difficult
task because project managers are often more concerned with achieving the
short-term objectives rather than long-term goals.

Check Your Progress


24. Which of the following options represents the correct relationships between
risk and control while balancing risk and control in the control process?
i. Low Control-High Risk
ii. Low Control-Low Risk
iii. High Control-Low Risk
iv. High Control-High Risk
a. Only i and iii
b. Only ii and iii
c. Only iii and iv
d. i, ii, iii and iv
25. Various factors cause imbalances in the control system. Which of the
following is not a cause for such imbalances?
a. Focusing on the easy to measure factors while ignoring the intangible
factors that are difficult to measure.
b. Laying too much emphasis on long-range objectives rather than short-
term results.
c. Exercising too much control.
d. Ignoring the organizational changes and structural changes brought
about by the time and the circumstances in which the firm operates.
26. Exercising greater control pushes up the cost of the project. _____________
reduces the overall cost liability for choosing a specific degree of control.
a. Balance point
b. Balance control system

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c. Post controls
d. None of the above

10.9 Control of Change and Scope Creep


Controlling the scope of a project involves attempts to include changes in the
project scope when they occur and manage these changes simultaneously. In
situations where these scope changes are inevitable, the project manager has to
find out their impact on the project plan and seek the approval for the same from
the client. Also the changes have to be communicated to the team members and
the stakeholders, after they are approved by the client. There are many factors
that have the potential to make a good application obsolete, such as changes in
technology, changes in the competitive environment, or the reactions of
customers. The three basic causes that can lead to changes in the project are;

 Uncertainty regarding the technology that is to be used in the project


 An increase in the level of sophistication of customers, leading to scope creep
 Modification of rules and regulations under which a process has to be carried
out to convert the input into a desired output.
Any change can hamper progress, especially if it is introduced in the
implementation phase. But changes cannot be avoided, as they are usually
caused by factors that are beyond the control of the project manager. An
effective project management system must have an effective change
management method. Most changes are a result of efforts made by the client and
the team members to improve the product. Incorporating changes when the
project has already reached an advanced stage is difficult and expensive.
The absence of a proper control system to qualify a change for an
implementation would result in a continuous piling up of all the small changes,
which will have a negative impact on the cost and schedule of a project.
Practices like Total Quality Management (TQM) and Employee Involvement
(EI) have proved helpful in conducting a detailed study on the outputs and
processes of control systems. This detailed study is conducted by a team that
represents the interests of all the stakeholders such as the clients, the
management, the project team and the community.
A formal change control system that can minimize the risk associated with a
change, is usually a part of the configuration management system that integrates
and coordinates changes across the project development life cycle. The tasks of
this system are;

 Examining the changes that are requested by the stakeholders of the project
 Determining the impact of these changes on the cost, schedule and performance
of the project
 Exploring alternate changes that could yield the same or better output

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Project Control

 Accepting or rejecting the changes that are proposed


 Communicating the changes to all the parties involved
 Incorporating the changes properly as per the plan
 Developing monthly reports detailing all the changes and their impact on the
project.
The following guidelines are useful in designing an effective change control
system:

 All project agreements should include a detailed report on how requests for a
change in the plan, budget, schedule or the output of a project should be
introduced and processed.
 A “change order” that describes every change in the project should be prepared.
This must include a description of the changes that are agreed upon, along with
corresponding changes in the plan, budget, schedule and output.
 An approval letter must be obtained, both from the client’s agent and senior
management’s representative, on the changes to be implemented. The project
manager should be consulted before the change order is finalized. However, the
approval of the project manager is not mandatory.
 Once the “change order” is approved, a master plan of the project should be
made reflecting the changes and the change order is now a part of the master
plan.
An effective change management process contains two documents:

 Requisition for change in a project and


 A project impact statement
Requisition for change in a project: It is important to document every change
requested by the client. This can be done in the form of a simple memo or in the
format prescribed by the project team. This will help the team to evaluate the
impact of the change on the project and to determine whether the change can be
incorporated.
Project impact statement: Once a requisition for a change is made, a project
impact statement is prepared. This statement identifies various alternative actions
along with the pros and cons of each. The client then chooses the best
alternative. The following are the possible responses to a requisition for a
change:

 Accommodating the change within the allocated resources and time schedule of
the project.
 Accommodating the change with an extension in the delivery schedule of the
project.
 Accommodating the change with additional resources and/or extension in
delivery schedule.
 Implementing the change in a phased manner by the way of prioritizing the
output needed.
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Project Planning and Control

Controlling Scope Creep


The most important reason for deviations from the budget is scope creep. One
factor that causes scope creep is the absence of a detailed definition of scope.
Repeated attempts by the project team and the client to improve the
product/service is another. It is important to design an effective control
mechanism to handle scope creep. The project manager must ensure that no
expenditure is incurred until the scope change is approved. With changes being
introduced during the implementation of the project, there is bound to be a
discrepancy between the actual output and the planned one. An effective
reporting system should be in place that periodically submits reports on the
progress of the project and gives details about all the changes and their impact
on the original project objectives and schedules, to all the parties involved in the
project.

Activity: Go Stop Inc. (GSI) is a Munich-based automobile braking systems


manufacturing company. It is an OEM (Original Equipment Manufacturer)
for more than 75 models of cars and bikes across Europe. The company
bagged an order from a motorbike manufacturing firm for its ventilated disc
braking systems. After the design was approved and the project was set to
start, the project organization received a requisition for change in the size of
the disc brakes. What should the project organization do to control the
changes and ultimately the scope of the project?

Answer:

Check Your Progress


27. A change management process requires two documents. ___________
identifies the various alternative actions along with the pros and cons of
each alternative.
a. Project impact statement
b. Requisition for change in a project
c. Project proposal
d. Project plan
28. Which of the following options describes all changes in the project?
a. Change order
b. Scope creep

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c. Current period reports


d. None of the above

10.10 Progress Reporting System


Once the project enters the implementation phase, the project manager has to be
kept informed about how the project is progressing. This can be done through an
effective reporting system. To design an effective reporting system, one must
first decide the following:
i) What information is to be reported? And how is it to be reported?
ii) How frequently are the reports to be submitted?
iii) What level of detail is to be reported?

10.10.1 Information to be Reported


To design a progress reporting system one must first determine various
information requirements of people involved in the project across the
organizational structure. This involves deciding what kind of information is
required and by whom, and at which hierarchy level, along with the timing and
duration of the reporting.
Determining a specific day of the week and a period of time: The updated
information has to be submitted by the project team on a particular day of the
week and for a specified duration of time as scheduled. It is the responsibility of
the project administrator to see that all the updated information is made available
in time.
Reporting the actual work done during the period: There is sometimes a lot of
difference between what was planned and what is actually accomplished.
Activity managers usually report that they have achieved what was planned,
even if they are behind schedule, hoping to catch up by the next reporting time.
It is the responsibility of the project manager to check the accuracy of
information provided in the report.
Recording the historical information and re-estimating the work that is to be
completed: Reporting all the finished work till the deadline along with the
analysis of deviations that occurred. A proper re-estimating is done on the work
to be completed in terms of cost and duration.
The start and finish dates have to be reported: The actual start and finish dates of
the tasks that are started or finished during the time of reporting.
Recording the number of days spent and the number of days required for the
completion of the task: The first parameter to be reported is the number of days
spent on doing the task. The other aspect to be reported is the number of days
required for completing the remainder of the task.

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Recording the number of hours spent per day to finish the task: The man hours
already spent on a task and also an estimate of the man hours required to
accomplish the remainder of the task.

10.10.2 Frequency of Reporting Progress


Progress reports are usually submitted once in a week. However, this varies from
project to project. As the complexity of the project changes the frequency of
reporting also changes.

10.10.3 Level of Detail to be Reported


It is very difficult to decide the exact level of detail that is to be included in a
project status report. The information needs of the person controlling the project
vary depending on his or her position in the management hierarchy. The
following are the information requirements for different people across the
organizational hierarchy:
The activity manager requires a detailed report, because he is the person directly
responsible for getting the work done. As he has to manage the resources
required for completing the project, he would like to know the what, why and
how of all the resources and activities under his control.
The project manager requires the status information of all the tasks that are in
progress during the reporting period. Reports submitted to the project manager
contain information related to scheduling. They are infact documents for
adjusting the schedules and for preparing the overall project status. The level of
detail of this report is very high and the report is generally meant for reviews
internal to the project teams.
Senior management usually prefers to get information in the form of graphs and
pictorial representations. As they have a very limited time for reviewing project
reports, a report submitted to them is best limited to a single page with the
milestones of the project highlighted. In case the project is out of balance, it is
advisable to attach a get-well plan narrating the problem involved, alternative
solutions, the actions recommended and some estimate of when the situation
will be rectified.

10.10.4 Characteristics of an Effective Progress Reporting System


The information gathered for a progress reporting system must have the
following characteristics:

 Information must be complete, accurate and timely.


 It should not add over head time to the planned time of completion.
 It must be acceptable to senior management and the project team.
 It should indicate the potential problems to the controller, in order to take timely
and proper action.
 It should be understood easily and clearly by the people who need it.

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Project Control

It is difficult to arrive at a generic reporting structure for all projects because


each and every project is unique and the information requirements of different
projects vary. Therefore, it is advisable to use project management software
packages to develop customized reports that meet the needs of different types of
projects.

10.10.5 Project Monitoring and use of IT


Project monitoring assumed importance because a large number of projects are
examples of time and cost overruns. While adequate attention is given to project
planning, necessary attention is not being paid towards execution. This is due to
lack of effective monitoring mechanisms. In many projects which are locally
executed but centrally controlled, personal monitoring is difficult and therefore
efficient IT enabled project monitoring systems are being used. It is now a part
of overall project management. On-line monitoring is necessitated by tight
schedules and huge penalties for delays. Major organizations implement
software project management tools for effective monitoring and timely
midcourse corrections to ensure that the costs and schedules are under control.
This will also enable on-line reviews, feedback, corrective and preventive
actions.
Many software tools have been developed for use by various project
environments. They are categorized as

 Standalone tools
 Mid Range tools
 High end Enterprise Management tools
 Software as a Service (SaaS) model and
 Open Source Project Management tools
For example, GanttProject is a simple project management tool to track tasks and
resources. The tool enables identification of hierarchical task dependencies,
define milestones, create work breakdown structure, create resource load chart,
view critical path in network, create PERT chart and generation of project status
reports.
Thus the use of IT in project monitoring, an integral part of project management
is increasingly dependent upon IT for on line information and speedy corrective
actions.

Check Your Progress


29. The project should be comprehensive to provide proper information that
meets the requirements of the people who use it. Which of the following
options represent this feature of the progress reporting system?
a. Frequency of the reporting progress
b. Information to be reported
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Project Planning and Control

c. Level of detail to be reported


d. None of the above
30. A good reporting system is needed for the project manager to be kept
informed about the progress of the project. Which of the following are the
characteristics of an effective progress reporting system?
a. Information should be complete, accurate, and timely.
b. It must be acceptable to the senior management of the firm.
c. It should be understood easily and clearly by the people who need it.
d. All of the above

10.11 Types of Project Status Reports


Depending on the degree of detail and the frequency of reporting, project status
reports can be classified into five categories – current period reports, cumulative
reports, exception reports, spotlight reports, and variance reports.

10.12.1 Current Period Reports


These reports describe the project activities that have recently been completed.
They indicate the progress of only those tasks that have been scheduled for a
specific period. These reports can also focus on the deviations between the
planned and the actual completion dates. The reasons for these deviations should
be explained and a plan to correct the deviations from schedule should be
recommended in the report.

10.12.2 Cumulative Reports


These reports present the history of the project, from its inception to the ending
of the current reporting period. Because these reports indicate trends in project
progress, they are considered to be more informative than current period reports.

10.12.3 Exception Reports


These reports show variances from the plan. Since senior managers do not have
much time to spare, the information in these reports is presented in a way that is
easy to read and interpret. Such reports have a one page executive summary that
highlights the main points of the status of the project and its deviations from the
plan. Senior managers who wish to learn about the reasons for these deviations
can read the detailed report.

10.12.4 Spotlight Reports


These reports are alterations to be used along with all the reports discussed
above. A green color sticker is placed on the top right hand corner of the first
page of the project status report, to indicate to senior management that the
project is progressing smoothly. A yellow sticker is placed on the top right
hand corner of the first page of the project status report, to indicate that though

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there have been some problems in the execution of the project, a plan is in place
to deal with these problems. An additional sheet attached to the report, describes
the problems in a detailed manner along with the measures that have been taken
to correct these problems and gives an estimate of the time needed to complete
this rectification. A red sticker is placed on the top right hand corner of the first
page of the project status report, to indicate that there is a serious problem in the
project for which no corrective measures have been developed. The conditions
in the red sticker reports are beyond the control of the project manager.

10.12.5 Variance Reports


These reports show how the delivered output/activity deviates from the plan. The
report is divided into three columns, having the planned number, the delivered
number and the variance (between the two) as the column heading. A variance
report can have a numeric or a graphic format. In a graphic representation, the
variance need not be represented because it is just the difference between the two
curves at a particular point in time. Variance reports follow a format that is
consistent across all the activities and tasks within a project, to make the senior
management feel more comfortable while using it.

Activity: Gautam Gupta is a senior project manager at a software consulting


firm. The firm bagged a project to develop an information system package for
an upcoming retail chain in India. Gupta is made the project leader for this
new project. The top management asked Gupta to design a separate progress
reporting system for the project so that the senior authorities could monitor
the project closely. What are the factors that Gupta should consider to
develop a progress reporting system? What are the different types of project
status reports he can consider?

Answer:

Check Your Progress


31. A ___________ is a type of report which shows how the delivered
output/activity deviates from the project plan.
a. variance report
b. spotlight report
c. exception report
d. cumulative report

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Project Planning and Control

32. The project reports are classified into various categories depending upon the
degree of detail and frequency of reporting. Identify the kind of report that
describes the project activities that have recently been completed.
a. Cumulative reports
b. Current period reports
c. Exception reports
d. None of the above
33. Which of the following are the alterations that are used to attract the
attention of the senior management to the status of the project?
a. Variance reports
b. Spotlight reports
c. Exception reports
d. None of the above

10.12 Graphical Reporting Tools


In addition to the reporting tools mentioned above that use numerical and
theoretical data, the following are the types of reporting techniques that use
graphs as their reporting tools. Graphical reporting tools are of three types –
Gantt charts, milestone trend charts, and cost schedule control. Given the time
constraints of the senior management, the project manager has to use reporting
tools that effectively convey the meaning of a 15-page document in a single
graphical representation.

10.13.1 Gantt Charts


Gantt charts depict the activities of a project in an easy-to-grasp manner. A Gantt
chart can be used for different applications in project management, starting from
planning, resource scheduling and status reporting. A Gantt chart represents the
schedule of a project in a two dimensional manner. Activities are plotted on the
Y-axis and time on the X-axis. The inability to show dependency relationships is
a shortcoming of a Gantt chart.

10.13.2 Milestone Trend Charts


Milestones are key events/activities in the project life cycle that need to be
tracked. These key events/activities represent the existence of certain conditions
in the project. Milestones are planned in a fashion similar to activity planning.
These charts plot the gap between the scheduled and the estimated dates of a
milestone of a particular period. Each reporting period shows an extra slippage
since the last reporting period. Project managers should take corrective action if
such a slippage occurs four times continuously, irrespective of the size of
slippage. Sometimes the milestone trend charts show drastic change between two
successive reporting periods. Such radical change patterns may be a result of

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Project Control

unrealistic time estimates at the planning stage or due to some data error
occurring while preparing the trend chart. Hence a project manager has to
conduct further enquiry to find out the reasons for such changes.

10.13.3 Cost Schedule Control


This tool uses rupee value of work performed to measure project performance.
Manhours/day can also be used to measure project performance if the project
budget is not being managed by the project manager. The measures
“Manhours/day” and the “Rupee value” of work are helpful for determining the
plan and cost variances in the current period and cumulative variances till date.
The planned work is compared to the actual work performed. These parameters
are required to give the total project history and it is not sufficient to have either
the planned work or the actual work accomplished. These parameters are
primarily used to monitor a project’s health, which must be restored by the
project manager as required.

A cost schedule control measures the budgeted cost of work scheduled, the
budgeted cost of work performed, and the actual cost of work performed.
Schedule variance and cost variance are the two-variance values resulting from
the above measurements.

A cost schedule control tool can be used not only to measure the health of a
project and report its history but also to predict the future status of the project.
Measuring the budgeted cost of work scheduled, budgeted cost of work
performed and the actual cost of work performed results in knowing the two
variance values that are schedule and cost variances. Apart from measuring and
reporting history, cost schedule control can also be used to predict the future
status of the project.

Inspite of designing and implementing various tools for reporting the progress of
the project there are some unanswered queries and doubts that can be solved
only by conducting project status review meetings that add a personal touch to
the mechanical processes involved.

Check Your Progress


34. Graphical tools are used to report the progress of the project along with the
numerical and theoretical data. Which of the following types of graphical
representations represents the schedule of the project in a two dimensional
manner?
a. Milestone trend charts
b. Gantt charts
c. Cost schedule control
d. None of the above

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Project Planning and Control

35. _______________ is a type of graphical reporting tool that not only


measures the current status of the project but also the future status of the
project.
a. Gantt charts
b. Milestone trend charts
c. Cost schedule control
d. None of the above
36. From the following options, identify the graphical reporting tool that tracks
the key events in the project life cycle.
a. Gantt charts
b. Milestone trend charts
c. Cost schedule control
d. None of the above

10.13 Project Status Review Meetings

Project status review meetings are used to review the status of projects. They are
not general discussions or meetings trying to solve a generic problem, but focus
on a single project with specifically timed agendas. Various kinds of reviews are
conducted throughout the project life cycle. For a project to be called a
successful one, the timing of reviews is important. A project undergoes the
following reviews during its life-cycle – status review (reviews the status of cost,
performance, schedule and scope), design review (reviews the design of the
product or service to ensure that it meets client requirements), and process
review (reviews the processes and checks for the possibility of any
improvements).

10.14.1 Status Review

The most frequently conducted review is the status review. A status review can be
comprehensive or cursory. Generally, a cursory review is conducted on a weekly
basis while a comprehensive review is conducted on a monthly basis. Generally,
for a project of one-year duration, a weekly cursory review and a monthly
comprehensive review will suffice. When the project runs into difficulties, the
frequency of reviews increases until the problem is solved. To avoid
micromanagement, the frequency of status reviews should be limited. A status
review should, ideally solve problems, not punish people. It is always
advantageous to know the kinds of problems existing in a system, the factors
causing these problems and the corrective measures required to solve them.

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10.14.2 Design Review


A design review ensures that the product or service being developed matches
customer requirements. Generally, such reviews are conducted when a milestone
has been reached. If a product is poorly designed, it will not meet customer
expectations. Therefore, the design review focuses on the performance
component rather than on cost, time and scope of the project.
The project manager has to keep in mind some guidelines while conducting
design reviews. It is necessary to include the conditions for manufacturing and
servicing in the design review. Ensuring optimization by integrating design with
manufacturing specifics like tooling and economics of process and specialty
machines, is also the responsibility of a design review. A design review also
considers the specifications of the working conditions such as storage of
inventory, ease of accessing the materials and tools, safety in operating and
maintaining and damage protection.

10.14.3 Process Review


The process review is focused on reviewing the “how” aspect of an activity. This
review tries to find out how an activity can be carried out in a better manner.
Process reviews typically take place at the milestones or once every two or three
months. This type of review tries to improve those activities that are not being
carried out well.
It is important to discuss the outcome of the different types of reviews with all
the parties involved in the project.
The activity manager reports the status of the project on a weekly basis to the
project manager, who in turn reports to senior management on a biweekly basis.
Thus it becomes appropriate to conduct project status review meetings once in
every two weeks. Though the duration of the status review meeting depends on the
size of the project, it is usually limited to one hour. The list of people attending the
review meeting varies across the project life cycle, depending on the need of the
person and the situation. Though status review meetings have a flexible format as
influenced by the need of the project, the top-down approach is commonly used.
The minutes of the meeting are circulated, revised for errors and follow ups and
filed in the project notebook.
Till now we have seen all the aspects of project control that are highly vulnerable
to change at any stage in a project life cycle. We have examined all the
dimensions of control, starting from the types of controls to be exercised, their
impact and the measures to be taken under various situations. We have also
described the reasons behind using controls to keep the project in equilibrium.
Now we are in a position to discuss the two most important aspects of project
control, without which the purpose of control is not achieved. They are Risk
Management and Quality Management.

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Example: Format of Top Down Approach used in Review Meetings

Participants in the
Specific Task Common Task
Review Meeting

Reporting the changes Closing comments of the


Project champions
that have a bearing on meeting
and customers
the future of the project.

Describing the health of Identifying new problems


the project along with and assigning the
Project manager the impact of problems, responsibility to solve the
changes and corrective same
measures.

Reporting the status of Identifying new problems


the tasks scheduled for and assigning the
Activity manager of
work between the responsibility to solve the
the present activity
previous and the current same
review meeting.

Reporting alterations Identifying new problems


since previous meeting and assigning the
Activity manager of
that have a potential responsibility to solve the
future activities
bearing an impact on the same
project status.

Reporting the status of Giving closing comments of


problems since the the meeting and/or
previous meeting. identifying new problems
Project manager and assigning the
Meeting is adjourned
responsibility to solve the
after announcing the
same
venue and timing of the
next meeting.

Check Your Progress


37. Identify the type of review which deals with the ‘How’ aspect of the project
activities.
a. Process review
b. Status review
c. Design review
d. None of the above

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Project Control

38. Which of the following types of project review assesses the design of the
product or service to ensure that it meets the requirements of the clients?
a. Design review
b. Status review
c. Process review
d. None of the above
39. Which of the following project review meetings are conducted to measure
the position of cost, performance, schedule, and scope of the project?
a. Process review
b. Design review
c. Status review
d. None of the above

10.14 Managing Risk


Since control and risk are indirectly related to each other, it is important to
examine their impact on each other. The higher the level of control, the lower the
risk of project failure. Risk can be defined as the probability of not meeting a pre-
defined project goal. While considering risk, the consequences associated with
failure should also be considered. Risk consists of three fundamental components -
- an event, the probability that the event happens, and the impact of probability on
happening of event.

Risk arises because of the lack of knowledge of future events. “Opportunities”


can be considered as favorable future events, while “risks” can be regarded as
the unfavorable future events. Effective project management is one that is able
to recognize the traps and allow the development of safeguards to overcome
these traps. With the required number of safeguards, risk is minimized. Since
risk is an activity that is based on the future, there are no tools that can totally
prevent risk. The project manager can only attempt to minimize risk, using
proper judgment.

Risk management as defined by the Project Management Institute Body of


Knowledge (PMBOK) is a formal process by which risk factors are
systematically identified, assessed and provided for. Though risk is minimized to
a certain extent by exerting control, there is also a need for a proper risk
management system. Effective risk control can be achieved by combining both
control and risk management systems. In order to control risk throughout the
project’s life cycle, a risk management strategy is necessary. Risk management
involves identifying, quantifying, responding to and controlling the risk.

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10.15 Managing Quality


Quality as defined by BS4778 is the totality of features and characteristics of a
product or service which bear on its ability to satisfy a stated or implied need.
Developing and managing a control system to test the quality of the final product
or service is high priority in project management. Developing control systems,
reporting systems, and risk management systems would be futile if no proper
quality control system is in place.
The main elements of a quality system are the policy behind maintaining quality
and description and procedures for maintaining quality, preferably in the same
order. The basic objective of a quality control system is to ensure a continuous
meeting of customer needs or system objectives.
For acquiring new businesses in new markets it is necessary to have a quality
control system. Having a quality control system also helps in protecting the firm
from product and legal claims (for faulty products) .
The PMBOK also refers to quality control as the technical aspect of quality
management. The project team members play an active role in project
management to make sure that every project process delivers a quality output.
The output at the end of each stage in the project must meet the overall quality
standards. This ensures that the desired quality is achieved. The following are
the characteristics of an effective quality control system:

 Capability in identifying what to control.


 Setting standards in order to provide the basis for taking decisions on corrective
measures.
 Developing quality measurement tools.
 Comparing the delivered output with the quality standards that have been set.
 Incorporating measures that can put the processes and outputs back to standard
if it fails to meet the quality standards.
 Monitoring and calibrating the devices used to measure quality.
 Detailed documentation of the process.

Check Your Progress


40. Which of the following are the fundamental components of risk?
i. An event
ii. The probability of the event happening
iii. The outcome of the event
a. Only i
b. Only i and ii
c. i, ii and iii
d. Only ii and iii
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Project Control

41. Which of the following are the characteristics of an effective quality control
system?
i.Capability in identifying what to control
ii.Developing quality measurement tools
iii.Detailed documentation of the process
iv.Monitoring and calibrating the devices used to measure quality
a. Only ii
b. Only i and iv
c. i, ii, iii, and iv
d. Only iii and iv
42. The probability of not meeting a pre-defined project goal is called
__________.
a. quality
b. risk
c. control
d. None of the above

10.16 Summary
 Project controls are tools developed to diagnose the system for deviations from
the actual plan and reset them back with the actual plans/schedule.
 Project controls are required to check whether the project is progressing in
accordance with the plans and standards set during the planning phase.
 For a control system to be effective and efficient, it should have the following
characteristics – comprehensiveness, communicability, authenticity, timeliness,
simplicity, flexibility, and morally sound.
 The primary objective of control is regulation, while the secondary objective of
control is conservation of resources.
 It is important to measure duration and cost deviations because they play a
significant role in the project management life cycle. Though all the parameters
of project management have their own levels of significance, time and cost
share a special place.
 Project control is generally implemented through people. Any form of control
has a significant impact on human behavior. Because of this, it becomes
necessary to study project control with special reference to people and their
behavior.
 The process of controlling a project is a highly complex task. Project control is
used to check the four key parameters time, cost, scope and performance.
 There are three basic control mechanisms – cybernetic control, go/no-go control,
and post control.

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Project Planning and Control

 The project plan may go out of balance any time and hence as a precautionary
measure, we require a corrective plan that can bring the system back to
equilibrium. Control systems are designed in such a way that they enable early
detection of problems and a faster implementation of corrective measures.
 The greater the control exercised over a project, the less likelihood there is of
project getting into trouble. The project manager has to decide as to what extent
the project has to be controlled as controls are costly. The balance point reduces
the overall cost liability for choosing a specific degree of control.
 Controlling the scope of a project involves attempts to include changes in the
project scope when they occur and manage these changes simultaneously.
 Once the project enters the implementation phase, the project manager has to be
kept informed about how the project is progressing. This can be done through an
effective reporting system.
 Depending on the degree of detail and the frequency of reporting, project status
reports can be classified into five categories -- current period reports, cumulative
reports, exception reports, spotlight reports, and variance reports.
 Gantt charts, milestone trend charts, and cost schedule control are the various
techniques that use graphs as their reporting tools.
 Project status review meetings are used to review the status of projects. They
focus on a single project with specifically timed agendas.
 Various kinds of reviews are conducted throughout the project life cycle. A
project undergoes the following reviews during its life-cycle – status review,
design review, and process review.
 Control and risk are indirectly related to each other. The higher the level of
control, the lower the risk of project failure.
 Quality can be defined as the totality of features and characteristics of a product
or service which bear on its ability to satisfy a stated or implied need.
Developing and managing a control system to test the quality of the final
product or service is high priority in project management.

10.17 Glossary
 Cybernetic Controls (or steering controls): These are used to monitor and
control tasks that are carried out more or less continuously, for example,
software projects.
 Progress Reporting System: A mechanism that keeps the project organization
updated on the performance of the vendor, i.e., the way in which he is achieving
the objectives of the contract.
 Project Control: The process of collecting information related to the
performance of the project system, comparing it with the desired level of
performance and taking corrective action to decrease the gap between the actual
and the desired performance levels.
 Project Plan: A formal, approved document used to manage and control project
execution.

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Project Control

 Project Proposal: An initial document that converts an idea or policy into


details of a potential project, including the outcomes, outputs, major risks, costs,
stakeholders and an estimate of the resources and time required.
 Project Status Report: A report mentioning the status of achievements and
deviations from the resources that are spent and the plans that are scheduled.
 Quality: The totality of features and characteristics of a product or service,
which influence its ability to satisfy a stated or implied need.
 Risk Management: A process by which risk factors are systematically
identified, assessed, and provided for.

10.18 Self-Assessment Exercises


1. Project control is not a separate phase in itself but it goes hand in hand with
the project implementation phase. Discuss the fundamental purpose of
project controls. Explain the characteristics of an effective control system.
2. Measurement of duration and cost deviations is very important as they play
a vital role in the project management life cycle. What are the reasons for
measuring duration and cost deviations.
3. Any form of control has a significant impact on human behavior. Explain
the objectives of controls, and the role played by controls as a function of
management. What are the control mechanisms? What do you think is the
relationship between control and risk?
4. The project plan being a system may go out of balance any time and hence
as a precautionary measure we require a corrective plan that can bring the
system back to equilibrium. How does the project manager balance a control
system? What are the factors that cause an imbalance in a control system?
5. Controlling the scope of a project involves attempts to include changes in
the project scope when they occur and manage these changes
simultaneously. What are the various ways in which the project manager can
control the change and the scope creep?
6. Once the project enters the implementation phase, the project manager has
to be kept informed about how the project is progressing. What are the
factors to be kept inmind while designing an effective reporting system?
Explain the characteristics of an effective progress reporting system.
7. Project status reports can be classified into various categories depending on
the degree of detail and the frequency of reporting. What are the various
types of project status reports?
8. The project manager has to use various reporting tools to convey the details
regarding the project status. What are the different graphical reporting tools
that can be used by a project manager?
9. Project status review meetings are used to review the status of projects.
Various kinds of reviews are conducted throughout the project life cycle.
Discuss the different types of reviews conducted by the project manager
during the life cycle of a project.

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Project Planning and Control

10. Control and risk are indirectly related to each other. Also, a proper control
system should be in place. How can the project manager manage the risk
involved and the quality of a project? Explain the characteristics of an effective
quality control system.

10.19 Suggested Reading/Reference Material


1. Prasanna Chandra, “Projects,” McGraw Hill, Seventh Edition, 2009.
2. Robert K. Wysocki, “Effective Project Management: Traditional, Agile,
Extreme,” Wiley India, 2009.
3. Jack R. Meredith and Samuel J. Mantel Jr., “Project Management: A
Managerial Approach,” Sixth Edition, Wiley India, 2008.
4. Harold Kerzner, “Project Management-A Systems Approach to Planning,
Scheduling and Controlling,” Second Edition, 2006.
5. “A Guide to the Project Management Body of Knowledge,” Project
Management Institute, Second Edition, December 2000.
6. Joseph Weiss and Robert K. Wysocki, “Five-phase Project Management: A
Practical Planning and Implementation Guide,” Basic Books, 1992.

10.20 Answers to Check Your Progress Questions


Following are the answers to the Check Your Progress questions given in the
Unit.
1. (c) Authenticity
Authenticity refers to budgetary discipline and expense tracking by
accounting tangible progress and cost expenditure in time.
Comprehensiveness refers to the detailed overview of the work performed.
Simplicity and being morally sound refer to the system being simple to
operate and conforming to all the ethical standards, respectively.
2. (b) Only i, ii, and iv
It is the responsibility of the project manager to ensure that the actual
performance matches the desired level of output. The parameters to be used
for this are performance, time, and cost.
3. (b) Project control
Project control is one of the most important parts in project implementation.
It is used to monitor the activities of the project and to take corrective action
if there is any deviation from the desired level of performance. The main
purpose of project control is to control and manage change in a project.
4. (c) i, ii, iii, and iv
The following are the characteristics of an effective project control system –
comprehensiveness, communicability, authenticity, timeliness, simplicity,
flexibility, and moral soundness.

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Project Control

5. (b) Flexibility
Flexibility refers to the system being open to extensions and alternations and
being easy to maintain. Comprehensiveness refers to the detailed overview
of the work performed. Simplicity and being morally sound refer to the
system being simple to operate and conforming to all the ethical standards.

6. (a) Conserving the resources


Conserving the resources is the secondary objective of project control. This
entails the protection of the physical, human, and financial resources of the
organization. Regulation and facilitation of decision-making are the primary
and territory functions respectively of project control.

7. (c) Regulation, conserving resources, and facilitating decision making


The primary objective of control is regulation, the secondary objective is
conserving resources, and the tertiary objective is facilitating decision
making.

8. (d) Dampening oscillation


Measuring the deviations helps the project manager in taking corrective
actions. This will reduce the oscillation of the curves representing the actual
and planned performance over time. The other options given are not correct
as they refer to the possibility of taking corrective action. Facilitating early
corrective action through weekly schedule variance will facilitate the project
manager to take action at an early stage of the project.

9. (c) Negative variance


Negative variance refers to the case in which the delivered output is behind
schedule or the cost incurred is more than the scheduled cost. Positive
variance is the opposite of negative variance where the delivered output is
ahead of the planned schedule or the cost incurred is less than the planned
cost.

10. (b) Variance

Variance is the deviation from the actual project plan. Based on the
parameters of time and cost, the variances may either be positive variances
(when the resulting output exceeds the expectations) and negative variances
(when the resulting output falls below the expectations).

11. (c) Cybernetic control


Cybernetic controls are used to monitor and control tasks that are carried out
more or less continuously. They are designed by identifying mechanical
tasks based on the work breakdown structure. Go/No-go and post controls
are not carried out automatically.

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Project Planning and Control

12. (b) directly


The cybernetic control system that minimizes the variation from the set of
standards is known as a negative feedback loop. The speed of action in a
negative feedback loop is directly proportional to the size of the variation
from the standard in that loop.
13. (c) Third order controls
Cybernetic controls can be classified into three types: The first order
control system, which is a goal-seeking device; the second order control
system, which can alter the standards that are set only in accordance with
predetermined rules and regulations; and the third order control system
which is a flexible goal-seeking device.
14. (c) i, ii, and iii
Individuals respond to the goal directedness of control systems in all the
three ways given i.e. through active and passive participation and goal
oriented behaviour, through passive involvement to minimize loss, and
through active but negative involvement and resistance.
15. (c) Milestones achieved in the project implementation.
The information required for developing the cybernetic controls is as
follows: defining the characteristics of the output that are to be controlled,
setting the standards for the defined characteristics, acquiring the sensors
that measure the characteristics at a particular level of precision,
transforming the measurements into signals that are to be compared with the
set standards, and detecting the difference between the output and the
standard set. The information regarding milestones achieved in the project
implementation is required in the setting up of Go/No-go controls.
16. (a) Negative feedback loop
The cybernetic control system that minimizes variation from the set
standards is known as a negative feedback loop. Go/No-go and post controls
are different types of controls as compared to the cybernetic controls.
17. (c) Post controls
Post controls deal with the ‘How’ aspect of deviation rather than the ‘Why’
aspect. Post control systems are applied after the completion of the project.
Post control has a significant role to play in the way future projects are
handled.
18. (c) Project definition statement
The documents needed for setting up the Go/No-go control mechanism are
project proposal, project plan, project specifications, project schedule,
project budgets, and milestones. The project definition statement provides
more detailed information about the project and is not used in setting up the
Go/No-go controls.

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Project Control

19. (c) post controls

Post controls are the control mechanisms that are applied after the
completion of the project. The cybernetic and Go/No-go controls are applied
at the time of project implementation itself. The negative feedback loop is a
part of the cybernetic controls.

20. (d) i, ii, iii, and iv

The post control report has the following sections: objectives of the project,
milestones, checkpoints, and budgets, final project report, and
recommendations for performance and process improvement.

21. (c) project schedule.

The project schedule is one of the important documents for setting up a


Go/No-go control mechanism. The document specifies the time frame for
each activity in the project.

22. (d) project specifications.

Project specifications are the set of rules and regulations under which the
objectives of the project are met. The other given options in the question are
wrong because the project proposal specifies the expected business value
along with the cost and time estimates of the project. The project plan gives
the ends and means of a particular action or objective. Project budgets are
the documents with estimation of the costs required to complete the project.

23. (b) Go/No-go controls

The Go/No-go control system functions only when it is put into application
by the controller. It is applied periodically. Cybernetic control functions
continuously and automatically. Post controls are applied only after the
completion of the project.

24. (a) Only i and iii

In the control process, the project manager has to strike a balance between
risk and control. The available options in the control process are high risk
with low control and high control with low risk as risk and control have an
inverse relationship with each other.

25. (b) Laying too much emphasis on long-range objectives rather than
short-term results.

Laying too much emphasis on the short-term results rather than the long-
term objectives is one of the causes for imbalances in the control system.
The other options given in the question are the causes for imbalance in the
control system.

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Project Planning and Control

26. (a) Balance point


As greater control is exercised on the project, the likelihood of the project
getting into trouble goes down. However, exercising greater control
increases the cost of the project. The balance point reduces the overall cost
liability for choosing a specific degree of control by achieving a balance
between the risk and control associated with the project.

27. (a) Project impact statement


The two documents in the change management process are: requisition for
change in a project and project impact statement. The requisition for change
documents all changes requested by the client. The project impact statement
identifies the various pros and cons of the various identified alternatives.
The project proposal and the project plan describe the expected business
value along with the cost and time estimates of the project and the ends and
means for particular action or objective.

28. (a) Change order


A change order depicts all the changes in the project. Current period reports
describe the activities that have recently been completed. Scope creep refers
to the changes in the project’s scope which cannot be controlled. Scope
creep occurs when the scope of a project is not properly defined and
controlled.

29. (c) Level of detail to be reported


The information needs of the people controlling the project vary depending
upon the people who use it. The information provided in the report should
be detailed enough to suit the information needs of people who use it.

30. (d) All of the above


The characteristics of an effective progress reporting system are:
Information should be complete, accurate, and timely; it should not add
overhead time to the planned time of completion; it must be acceptable to
the senior management and the project team; it should indicate potential
problems to the controller; and it should be understood easily and clearly by
the people who need it.

31. (a) variance report


Variance reports show how the delivered output deviates from the plan. The
report consists of three columns, viz., planned number, delivered number,
and the variance. Spotlight reports are the reports which are used along with
other reports. Exception reports show variances from the plan. Cumulative
reports present the history of the project from its inception to the end of the
current reporting period.

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Project Control

32. (b) Current period reports


Current period reports depict the project activities that have recently been
completed. They indicate the progress of the tasks that have been scheduled
for a specific period. Cumulative reports present the progress of the project
from its inception to the current reporting period. Exception reports show
the variances from the plan.
33. (b) Spotlight reports
Spotlight reports are the alterations that are used with other types of project
status reports. Stickers of various colours like green, yellow, and red are
used to indicate the status of the project. Exception reports show the
variances from the plan and variance reports show how the delivered
output/activity deviates from the plan.
34. (b) Gantt charts
Gantt charts depict the activities of the project in an easily understandable
manner. They represent the schedule of a project in a two-dimensional
manner. Activities of the project are depicted on the Y-axis, and time is
represented on the X-axis. Milestone trend charts track the key activities that
need to be tracked. Cost schedule uses the rupee value of the work
performed to measure project performance.
35. (c) Cost schedule control
Cost schedule control can be used to predict the future status of the project
apart from measuring and reporting the history of the project. Gantt charts
and milestone trend charts are not used to predict the future of the project.
36. (b) Milestone trend charts
Milestone trend charts track the milestones or key events/activities in the
project life cycle. Gantt charts depict the activities of the project in a way
which is easy to grasp. Cost schedule control uses the rupee value of the
work performed.
37. (a) Process review
The process review tries to find out how an activity can be carried out better.
38. (a) Design review
Design review assesses the design of the product to ensure that it meets the
requirements of the client. Status review assesses the status of the cost,
performance, schedule, and scope of the project. Process review assesses the
process of the project.
39. (c) Status review
Status reviews are conducted on a periodic basis to review the position of
the project. They may be cursory or comprehensive reviews. Design and
process reviews are meant to review the design and process of the project.

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Project Planning and Control

40. (b) Only i and ii


The three fundamental components of risk are: an event, the probability of
the event happening, and the impact of the probability on the happening of
the event.

41. (c) i, ii, iii, and iv


The characteristics of an effective quality control system are: being capable
of identifying what to control, setting standards in order to provide the basis
for taking decisions on corrective measures, developing quality
measurement tools, comparing the delivered output with the quality
standards that have been set, incorporating measures that can put the
processes and outputs back to standard if they fail to meet the quality
standards, monitoring and calibrating the devices used to measure quality,
and including detailed documentation of the process.
42. (b) risk
The probability of not meeting a pre-defined project goal is called risk.
Quality is the essential or distinctive characteristic of any value which is
under measure. Control refers to ensuring that all project activities are going
as per the plan and the steps that need to be taken to mitigate any deviations
from the plan.

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Project & Operations Management
Course Components
BLOCK I Project Management – An Overview
Unit 1 Introduction to Project Management
Unit 2 Project Idea Generation and Screening
Unit 3 Market and Technical Analysis of Projects
Unit 4 Financial Analysis of Projects
Unit 5 Project Selection
BLOCK II Project Planning and Control
Unit 6 Management of Project Scope
Unit 7 Identifying Project Activities
Unit 8 Activities: Sequencing, Estimating Duration, and Scheduling
Unit 9 Project Review
Unit 10 Project Control
BLOCK III Project Implementation and Closing
Unit 11 Project Cost Management
Unit 12 Project Risk Management
Unit 13 Project Quality Management
Unit 14 Project Auditing
Unit 15 Project Closing
BLOCK IV Introduction to Operations Management
Unit 16 Operations Management and Operations Strategy
Unit 17 Forecasting Demand
Unit 18 Allocating Resources to Strategic Alternatives
Unit 19 Design of Production Processes
BLOCK V Design of Facilities and Operations Planning
Unit 20 Facility Location and Layout
Unit 21 Aggregate Planning and Capacity Planning
Unit 22 Fundamentals of Inventory Control
Unit 23 Purchase Management
Unit 24 Materials Management
BLOCK VI Operations Control
Unit 25 Operations Scheduling
Unit 26 Enterprise Resource Planning
Unit 27 Supply Chain Management
Unit 28 Just-In-Time (JIT) Manufacturing System
Unit 29 Productivity and Quality Management
Unit 30 Facilities and Maintenance Management
BLOCK VII Current Trends in Operations Management
Unit 31 Trends in Operations Technology
Unit 32 Globalization and Operations Management
Unit 33 Sustainability and Operations Management

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