DEFINING THE PROJECT

CHAPTER 4
Step 3:​Creating the Work Breakdown Structure
WHERE ARE WE NOW Step 4:​Integrating the WBS with the Organization
Step 5:​Coding the WBS for the Information System

4.1. STEP 1: DEFINING THE PROJECT SCOPE

PROJECT SCOPE DEFINED

●​ Is a definition of the end result or mission of
your project—a product or service for your
client/customer.
●​ Defines the results to be achieved in specific,
tangible, and measurable terms.
●​ Defining the project scope sets the stage for
LEARNING OBJECTIVES developing a project plan.
●​ Research clearly shows that a poorly defined
●​ Identify key elements of a project scope scope or mission is the most frequently
statement and understand why a complete mentioned barrier to project success.
scope statement is critical to project success. ●​ The project manager is responsible for seeing
●​ Describe the causes of scope creep and ways that there is agreement with the owner on
to manage it. project objectives, deliverables at each stage of
●​ Understand why it is important to establish the project, technical requirements, and so
project priorities in terms of cost, time, and forth.
performance.
●​ Demonstrate the importance of a work PURPOSES OF THE PROJECT SCOPE STATEMENT
breakdown structure (WBS) to the
●​ Primary purpose is to define as clearly as
management of projects and how it serves as
possible the deliverable(s) for the end user
a database for planning and control.
and to focus project plans
●​ Demonstrate how the organization
●​ To direct focus on the project purpose
breakdown structure (OBS) establishes
throughout the life of the project for the
accountability to organization units.
customer and project participants
●​ Describe a process breakdown structure (PBS)
○​ Scope document
and when to use it.
●​ To be published and used by the project
●​ Create responsibility matrices for small
owner and project participants for planning
projects.
and measuring project success
●​ Create a communication plan for a project.
○​ Project scope definition

CHAPTER OUTLINE SCOPE

●​ Describe what you expect to deliver to your
4.1. Step 1: Defining the Project Scope customer when the project is complete.
4.2. Step 2: Establishing Project Priorities ●​ The scope should be developed under the
4.3. Step 3: Creating the Work Breakdown Structure direction of the project manager, customer, and
4.4. Step 4: Integrating the WBS with the other significant stakeholders.
Organization
4.5. Step 5: Coding the WBS for the Information PROJECT SCOPE CHECKLIST
System
4.6. Process Breakdown Structure Clearly, project scope is the keystone interlocking all
4.7 Responsibility Matrices elements of a project plan. To ensure that scope
4.8 Project Communication Plan definition is complete, you may wish to use the
following checklist:
1.​ Project objective
FIVE GENERAL STEPS FOR COLLECTING 2.​ Product scope description
PROJECT INFORMATION 3.​ Justification
Step 1:​Defining the Project Scope 4.​ Deliverables
Step 2:​Establishing Project Priorities 5.​ Milestones

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 Chapter 4: Defining the Project

6.​ Technical requirements -​ Exclusions further define the boundary of

7.​ Limits and exclusions the project by stating what is not included
8.​ Acceptance criteria
6.​ Reviews with customer
(BOOK BASED) -​ Completion of the scope checklist ends
1.​ Project objective with a review with your
-​ The first step of project scope definition is customer—internal or external.
to define the overall objective to meet your -​ The main concern here is the
customer’s need(s). understanding of and agreement to
-​ The project objective answers the expectations.
questions of what, when, how much, -​ Clear communication in all these issues
and at times, where. is imperative to avoid claims or
misunderstanding.
2.​ Deliverables
-​ The next step is to define major PROJECT SCOPE: TERMS AND DEFINITIONS
deliverables—the expected, measurable
outputs over the life of the project.
-​ In the second phase deliverables could be SCOPE STATEMENTS
software coding and a technical manual. ●​ Is a short, one- to two-page summary of key
The next phase could be the prototype. elements of the scope, followed by extended
The final phase could be final tests and documentation of each element.
approved software. ○​ Scope definition should be as brief as
-​ Note: Deliverables and requirements are possible but complete
often used interchangeably. ●​ Is also referred to as “statements of work
(SOWs)”
3.​ Milestones ○​ A few companies engaged in contracted
-​ a significant event in a project that occurs work refer to scope statements as SOW
at a point in time.
-​ The milestone schedule shows only major PROJECT CHARTER
segments of work ●​ Is a documentation that authorizes the
-​ It represents first, rough-cut project manager to initiate and lead the
estimates of time, cost, and resources project.
for the project. ●​ This document is issued by upper
-​ The milestone schedule is built using management and provides the project
the deliverables as a platform to manager with written authority to use
identify major segments of work and organizational resources for project activities.
an end date. ●​ Often includes a brief scope description as
-​ Milestones should be natural, important well as such items as risk limits, business case,
control points in the project. spending limits, and even team composition.
-​ Milestones should be easy for all project
participants to recognize. SCOPE CREEP
●​ Is the tendency for the project scope to
4.​ Technical requirements expand over time—usually by changing
-​ More frequently than not, a product or requirements, specifications, and priorities.
service will have technical requirements to ●​ Scope creep can be reduced by carefully
ensure proper performance. writing your scope statement.
-​ Technical requirements typically clarify ●​ A scope statement that is too broad is an
either the deliverables or define the invitation for scope creep.
performance specifications. ●​ Scope creep can have a positive or negative
effect on the project, but in most cases scope
5.​ Limits and exclusions creep means added costs and possible project
-​ Limits of scope should be defined delays.
-​ Failure to do so can lead to false ●​ If the project scope needs to change, it is
expectations and to expending resources critical to have a sound change control
and time on the wrong problem. process in place that records the change and
keeps a log of all project changes.

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 Chapter 4: Defining the Project

●​ The log identifies the change, impact, and those to be made, is it permissible for the schedule to
responsible for accepting or rejecting a slip, to reduce the scope and performance of
proposed change. the project, or to go over budget?

FIVE OF THE MOST COMMON CAUSES OF PROJECT MANAGEMENT TRADE-OFFS

SCOPE CREEP (PNULG)
●​ Poor requirement analysis
●​ Not involving users early enough
●​ Underestimating project complexity
●​ Lack of change control
●​ Gold plating
○​ The incorporation of costly and unnecessary
features or refinements into a product or
structure.
●​ One of the primary jobs of a project
4.2. STEP 2: ESTABLISHING PROJECT manager is to manage the trade-offs among
PRIORITIES time, cost, and performance.
Quality and the ultimate success of a project are ●​ To do so, project managers must define and
traditionally defined as meeting and/or exceeding understand the nature of the priorities of the
the expectations of the customer and/or upper project.
management. ●​ They need to have a candid discussion with the
project customer and upper management to
Three major criteria (trade-offs) that a project establish the relative importance of each
manager has to manage are: criterion.
●​ Cost (budget)
●​ Time (schedule) PROJECT PRIORITY MATRIX FOR THE
●​ Performance (scope) DEVELOPMENT OF A NEW WIRELESS ROUTER

The interrelationship among these criteria varies. For

example, sometimes it is necessary to compromise
the performance and scope of the project to get the
project done quickly or less expensively. Often the
longer a project takes, the more expensive it
becomes. However, a positive correlation between
cost and schedule may not always be true. Other
times project costs can be reduced by using cheaper,
less efficient labor or equipment that extends the
duration of the project.
●​ Time to market is important to sales, the
A project manager can manage the project
project manager is instructed to take
trade-offs by completing a priority matrix for
advantage of every opportunity to reduce
the project and identifying which criterion is:
completion time.
●​ Constrain — original parameter is fixed. The
●​ In doing so, going over budget is acceptable
project must meet the completion date,
though not desirable.
specifications and scope of the project, or
●​ At the same time, the original performance
budget.
specifications for the modem as well as
●​ Enhance — a criterion should be optimized. In
reliability standards cannot be compromised.
the case of time and cost, this usually means
●​ Priorities vary from project to project.
taking advantage of opportunities to either
●​ Alternatively, for special event projects
reduce costs or shorten the schedule.
(conferences, parades, tournaments) time is
Conversely, with regard to performance,
constrained once the date has been
enhancing means adding value to the project.
announced, and if the budget is tight, the
●​ Accept — a criterion is tolerable not to meet
project manager will compromise the scope of
the original parameter. When trade-offs have

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 Chapter 4: Defining the Project

the project in order to complete the project on

time.
●​ Some would argue that all three criteria are
always constrained and that good project
managers should seek to optimize each
criterion. If everything goes well on a project
and no major problems or setbacks are
encountered, their argument may be valid.
○​ However, this situation is rare, and project
managers are often forced to make tough
decisions that benefit one criterion while
compromising the other two.
●​ In summary, developing a priority matrix for
a project before the project begins is a useful
exercise.
○​ It provides a forum for clearly establishing
priorities with customers and top
management so as to create shared
expectations and avoid
misunderstandings.
●​ The priority information is essential to the ●​ This breakdown groups work packages by
planning process, where adjustments can be type of work within a deliverable and allows
made in the scope, schedule, and budget assignment of responsibility to an
allocation. organizational unit. This extra step facilitates
●​ Finally, the matrix is useful midway in the a system for monitoring project progress
project for approaching a problem that must (discussed in Chapter 13).
be solved. ●​ The WBS begins with the project as the final
deliverable.
●​ Major project work deliverables/systems are
4.3. STEP 3: CREATING THE WORK identified first; then the subdeliverables
BREAKDOWN STRUCTURE necessary to accomplish the larger deliverables
are defined.
WORK BREAKDOWN STRUCTURE ●​ The process is repeated until the subdeliverable
●​ Is a hierarchical outline of the project with detail is small enough to be manageable and
different levels of detail. where one person can be responsible. This
●​ Identifies the products and work elements subdeliverable is further divided into work
involved in a project, and to establish a basis packages.
for control. ●​ Because the lowest subdeliverable usually
●​ Defines the relationship of the final includes several work packages, the work
deliverable (the project) to its packages are grouped by type of work—for
sub-deliverables, and, in turn, their example, design and testing.
relationships to work packages. ●​ These groupings within a subdeliverable are
●​ Serves as a framework for tracking cost and called cost accounts.
work performance. ○​ This grouping facilitates a system for
●​ Is best suited for design and build projects monitoring project progress by work, cost,
that have tangible outcomes rather than and responsibility.
process-oriented projects.
HOW WBS HELPS THE PROJECT MANAGER
HIERARCHICAL BREAKDOWN OF THE WBS ●​ Assures project managers that all products
and work elements are identified, to integrate
the project with the current organization, and
to establish a basis for control.
●​ Facilitates the evaluation of cost, time, and
technical performance at all levels in the
organization over the life of the project.

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 Chapter 4: Defining the Project

●​ Provides management with information ●​ Identifies monitoring points for measuring

appropriate to each organizational level. progress (how well).
●​ WBS also serves as a frame- work for tracking
cost and work performance. 4.4. STEP 4: INTEGRATING THE WBS WITH
●​ Helps project managers to plan, schedule, and THE ORGANIZATION
budget the project.
●​ Helps in the development of the organization
breakdown structure (OBS), which assigns ORGANIZATION BREAKDOWN STRUCTURE
project responsibilities to organization units ●​ Depicts how the firm has organized to
and individuals. discharge work responsibility.
●​ Provides the opportunity to “roll up” (sum) the ●​ Provides a framework to summarize
budget and actual costs of the smaller work organization unit work performance.
packages into larger work elements. ●​ Identifies the organization units responsible
●​ Defines communication channels and assists for work packages.
in understanding and coordinating many ●​ Ties the organizational unit to cost control
parts of the project. accounts.

The intersection of work packages and the

WORK BREAKDOWN STRUCTURE
organization unit creates a project cost point or
cost account that integrates work and
responsibility.

INTEGRATION OF WBS AND OBS

WORK PACKAGE
●​ Is the lowest level of the WBS.
●​ Is a short-duration task that has a definite
start and stop point, consumes resources, and
represents cost.
●​ Should not exceed 10 work days or one 4.5. STEP 5: CODING THE WBS FOR THE
reporting period. INFORMATION SYSTEM
●​ Should be as independent of other work
packages of the project as possible. WBS CODING SYSTEM
●​ Is the basic unit used for planning,
●​ Defines
scheduling, and controlling the project.
○​ Levels and elements in the WBS
○​ Organization elements
EACH WORK PACKAGE IN THE WBS ○​ Work packages
●​ Defines work (what). ○​ Budget and cost information
●​ Identifies time to complete a work package ●​ Allows reports to be consolidated at any level
(how long). in the structure.
●​ Identifies a time-phased budget to complete
a work package (cost). WBS DICTIONARY
●​ Identifies resources needed to complete a ●​ Provides detailed information about each
work package (how much). element in the WBS.
●​ Identifies a single person responsible for units
of work (who). CODING THE WBS

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 Chapter 4: Defining the Project

4.7. RESPONSIBILITY MATRICES

RESPONSIBILITY MATRIX (RM)

●​ Is also called a linear responsibility chart.
●​ Summarizes the tasks to be accomplished and
who is responsible for what on the project.
●​ Lists all the project activities and the
participants responsible for each activity.
4.6. PROCESS BREAKDOWN STRUCTURE ●​ Clarifies interfaces between units and
individuals that require coordination.
PROCESS BREAKDOWN STRUCTURE (PBS) ●​ Provides a mean for all participants in a
●​ Is used for process-oriented projects. project to view their responsibilities and agree
●​ Is often referred to as the “waterfall method” on their assignments.
in the software industry. ●​ Clarifies the extent or type of authority
exercised by each participant.
PROCESS-ORIENTED PROJECT
●​ Is a project that the final outcome is a RESPONSIBILITY MATRIX FOR A
product of a series of steps and phases. MARKET RESEARCH PROJECT
●​ Is a project that evolves over time with each
phase affecting the next phase.
●​ Is a project that is driven by performance
requirements, not by plans/blueprints.

PBS FOR SOFTWARE DEVELOPMENT PROJECT

RESPONSIBILITY MATRIX FOR THE

CONVEYOR BELT PROJECT

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 Chapter 4: Defining the Project

SHALE OIL RESEARCH PROJECT

COMMUNICATION PLAN

4.8. PROJECT COMMUNICATION PLAN

Project communication plans address the
following questions:
●​ What information needs to be collected and
when?
●​ Who will receive the information?
●​ What methods will be used to gather and
store information?
●​ What are the limits, if any, on who has access
to certain kinds of information?
KEY TERMS
●​ When will the information be communicated?
●​ How will it be communicated? ●​ Acceptance criteria
●​ Cost account
●​ Gold plating
STEPS FOR DEVELOPING A COMMUNICATION ●​ Milestone
PLAN ●​ Organization breakdown structure (OBS)
1.​ Stakeholder analysis — identify the target ●​ Priority matrix
groups. ●​ Process breakdown structure (PBS)
2.​ Information needs — project status reports, ●​ Product scope description
deliverable issues, changes in scope, team ●​ Project charter
status meetings, gating decisions, accepted ●​ Responsibility matrix
request changes, action items, milestone ●​ Scope creep
reports, etc. ●​ Scope statement
3.​ Sources of information — where does the ●​ WBS dictionary
information reside? ●​ Work breakdown structure (WBS)
4.​ Dissemination modes — hardcopy, e-mail, ●​ Work package
teleconferencing, SharePoint, and a variety of
database sharing programs.
5.​ Responsibility and timing — determine who
will send out the formation and when.

STAKEHOLDER COMMUNICATIONS

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