Notes on Project Management
• Project Management-To get the Project done on time, within budget and according to
desired quality standard
• Project involves men and basically management is nothing but managing men tactfully
• Main tasks of Project Management are
Planning
-What is to be accomplished?
-Who is responsible for what?
-What resources are required?
-What must be done when?
-How will the resources be allocated-?
Organizing
-Dedicated Team
-Matrix Management
Co-ordination
-Different Department are involved in Project Management
- Effective co-ordination essential for optimum results
-Leadership and team building skill important for the
Manager for success
-Shall have to depend on personal relationship to gain
Commitment
-Persuasion and influence are most important tools to achieve
Effective coordination
Controlling
-Monitoring Performance
-Taking corrective Action
• Forms of Project Organization
Line And Staff Organization
Divisional Organization
Matrix Organization
• Project Organization Determinants
Independence of Project Team
Fitment of Project Organization in overall Organization
Extent of Delegation to Project Authorities
Mode of Assigning Project Work To team
Profit Centers or otherwise
Work Culture Considerations
Project Planning
Planning the Project Work
Planning the Manpower Organization
Planning For Money required
Planning Information System
• Project Objectives and Policies
Project Monitoring
• Monitoring-Monitor the progress and keep track of
• The time, cost & performance Standards
• Of all work Packages in the Project.
• Monitoring Requires:-
• -Designing, Developing, & Implementing
• Well organized Control Systems
• -Obtaining of Efficient & Effective feed
• Back on Project control
• -Keeping the project on target as close
• To the Project Plan as is feasibly possible
Tools of Monitoring
• Detailed Project Report
• Other Reports designed by the Company to Control Cost, Time, Works quantity and quality
e.g.
• Works Status Reports
• Financial Reports
• Engineering Reports
• Construction and Erection Reports
• Procurement Reports
• Project Management Reports
Usage of Reports
• Assessing Actual against Planned Technical Accomplishments
• Reviewing and verifying the validity of technical Objectives
• Conforming to the continued needs of the Project
• Timing it to coincide with operation
Requirements
• Overseeing Resource allocation & Expenditure
Effective Control System
• should be tracking and Prodding towards
• Ultimate Goal Of adhering to
Time Schedule
Cost
Quality
Performance
• Monitoring Generally done at three stages
TOP
Middle
Lower
Control Process
• Basically concerned with
Assessing Actual against planned Technical Accomplishments
Reviewing and verifying the validity of Technical Objectives
Conforming to the continued needs of the Project
Timing it to coincide with operation requirements
Overseeing Resource Allocation and Expenditures
Comparing the anticipated values with the cost incurred
Analysis of the variances
Taking Corrective Action
Variance Analysis
• It involves
Comparing the anticipated values with the cost Incurred
Analysis of the variances
Taking corrective action
• It involves
Comparing the anticipated values with the cost Incurred
Analysis of the variances
Taking corrective action
Weaknesses of Variance Analysis
• Backward Looking Instead Forward Looking
• Does not give information as to whether
I ) Project as a whole is on, behind or ahead of schedule
ii) In case of variation, who is responsible?
iii) Is the cost of Project as a whole as per budget
Estimates or more or less and who?
iv) In case of variation who is responsible for it?
iv) What is the trend of performance and what will be?
The final cost and completion date?
• These questions are answered by Performance Analysis which concerns cost & Schedule
Analysis
Performance Analysis
• Budgeted Cost Of Works Schedule (BCWS) =
I) Budget for work packages, Schedules to be
Completed
ii) Budget for portion of in process work to be
Accomplished
iii) Budget for the over head for the period
Budgeted cos of Work Performed
• BCWP
I) Budget for work packages Actually Completed
ii) Budget Applicable to Completed in Process
Work
iii) Overhead Budget for the period
Other Terminologies
• Actual Cost of Work Performed (ACWP) =Actual Cost incurred for accomplishing the work
performed during the period
• Budgeted Cost for Total Work (BCTW) =Total Budgeted Cost For the entire Project
• Additional Cost for Completion (ACC) =Estimates for additional cost required for completion
of work
Performance Analysis
• Cost Variance=BCWP-ACWP
• Schedule variance in cost Terms=BCWP-BCWS
• Schedule Performance Indices (SPI) =BCWP/BCWS
• Cost Performance Indices= (CPI) =BCWP/ACWP
• Estimated Cost Performance Index=BCTW/ (ACW
Problems of Project Control
• Emphasis generally on Cost; Project schedule and technical aspects get ignored
• Inappropriate level of details
• Control procedures generally resisted and not complied
• Information collected may be incorrectly or partly reported
• People may not understand Problems when Confronted
• Self appraisal control System make Project Personnel defensive and prone to personal biases
• Feeling that problems shall get solved over a period complicate the issue
• Trading of good performance in one Project with bad performance in other Project not
conductive
• Information Reporting and Accounting Process may be misleading
• Poor Control and information System
• Delays in reporting Performance
• Inappropriate levels of Details
• Unreliable Information
Major causes of overruns
• Delays in Sanctions & Disbursements
• Delays in Seeking Approvals
• Land Litigation
• Problems of water And Electric Supply
• Non Availability Resources
• Infrastructure Constrains
• Failure of Vendors & Transporters
• Design Change
• Changes in Project Parameters
• Faulty Planning
• Labor Problems
• Review of Installed Capacity
Cost of Delays
• Interest on invested Capital
• Increase in overhead Expenses like Wages, Salary, insurance etc
• General Price escalation
• Compensation to consultants and Contractors
• Loss of Production
• Loss of competitive edge resulting in to recurring loss during the life of the Project
• Opportunity Cost
• Loss of Reputation in Public life
• Ill effects on Employees’ morale
Phases of Project Cycle
• Conceptualization Stage-Identification, Feasibility Study, Project team, Sketches and
Drawings, Basic Budgets, Financing, Obtaining Approvals and Go ahead etc
• Planning-Develop plan, Conduct Studies, Select Equipments, Submission of Project Briefs,
Cash Flows, Obtaining approvals to implement
• Execution-Set up Organization and Specifications, Working Drawings, Procurement, Quality
assurances, Verify Performance, Modifications
• Termination-Train Operators, Transfer Material, Documents, Results, Reassign Project Work,
release Resources, Transfer Responsibility etc
