Project Scope, Time and Cost IT Project Management PM Knowledge Areas:

Topics PMI Knowledge Areas: Scope Management Time Management Cost Management 2

PROJECT SCOPE MANAGEMENT 3

Project Scope Management Project Scope Deliverables Project scope management includes the processes involved in defining and controlling what is or is not included in a project 4

Project Scope Statement 5

Work Breakdown Structure (WBS) A WBS is a deliverable-oriented grouping of the work involved in a project that defines the total scope of the project 6

Work Breakdown Structures 7

WBS from Text 8

Example: Work Breakdown Structure (WBS) 1.0 Concept 1.1 Evaluate current systems 1.2 Define Requirements Define user requirements Define content requirements Define system requirements Define server owner requirements 1.3 Define specific functionality 1.4 Define risks and risk management approach 1.5 Develop project plan 1.6 Brief Web development team 2.0 Web Site Design 3.0 Web Site Development 4.0 Roll Out 5.0 Support 9

Identifying Project Size Two Approaches  Planning Phase Approach Amount of time spent in planning Simple project will require little planning  Function Point Approach 10 Planning Analysis Design Implementation Industry Standard For Business15% 20% 35% 30% Applications TimeActual: Estimated: Required in Person Months

Function Point Approach 11

Step 1: Estimate System Size 12 Step 1.1: Function Point Calculation

Step 1.2: Processing Complexity (PC) Calculation 13

Function Point Estimation 14 Processing Complexity (PC):__7______ (From Step 1.2) Adjusted Processing Complexity (APC) = (0.001 x __7_ ) = 0.72 Total Adjusted Function Points:_0.72 x _338_ = 243 (TAFP) (TUFP -- From Step 1.1) Based on perceived system complexity; 0.65 for simple, 1.00 for normal, and 1.35 for complex systems

Calculating Lines of Code (LOC) 15 Language Avg. LOC per Function Point Total LOC= TAFP x Avg. LOC per Function Point 243 x 50 = 12,150 (for Visual Basic)

Step 2: Estimate Effort Required 16 Function of size and production rate COCOMO model  Converts a lines-of-code estimate into a person-month estimate  For moderate-size projects multiply thousands lines of code by 1.4 to get the number of people to assign to the project Effort (in person-months) = 1.4 x = From Step 1, Total LOC divided by 1000

Step 3: Estimate Time Required 17 Rule of thumb for estimation Schedule time (months) = 3.0 x person-month 1/3 =3.0 x (17.01) 1/3 =7.713 From Step 2, Effort (in person-months)

PROJECT TIME MANAGEMENT 18

Importance of Project Time Management Managers often cite delivering projects on time as one of their biggest challenges Time has the least amount of flexibility; it passes no matter what happens on a project Schedule issues are the main reason for conflicts on projects, especially during the second half of projects FBI Trilogy project  A.K.A. the “Tragedy” project 19

Time Management Activities Activity Management  Activity definition  Activity sequencing  Activity resource estimating  Activity duration estimating Schedule Management  Schedule development  Schedule control 20

Activity Definition Project schedules grow out of the basic documents that initiate a project Activity definition involves developing a more detailed WBS and supporting explanations to understand all the work to be done so you can develop realistic cost and duration estimates 21

Activity List and Milestones An activity list is a tabulation of activities to be included on a project schedule that includes: A milestone is a significant event that normally has no duration 22

Activity Sequencing Involves reviewing activities and determining dependencies A dependency or relationship is the sequencing of project activities or tasks You must determine dependencies in order to use critical path analysis 23

Network Diagrams Network diagrams are the preferred technique for showing activity sequencing A network diagram is a schematic display of the logical relationships among, or sequencing of, project activities Two main formats  Activity-on-Arrow  Activity-on-Node 24

Activity-on-Arrow Network Diagram 25

Activity-on-Node Network Diagram 26

Precedence Diagramming Method 27

Task Dependency Types 28

Schedule Development Uses results of the other time management processes to determine the start and end date of the project Ultimate goal is to create a realistic project schedule that provides a basis for monitoring project progress for the time dimension of the project Tools and Techniques 29

Gantt Chart Gantt charts provide a standard format for displaying project schedule information Symbols include:  Black diamonds: milestones  Thick black bars: summary tasks  Lighter horizontal bars: durations of tasks  Arrows: dependencies between tasks 30

Example: Gantt Chart 31

Comparison of Gantt Charts and Network Diagrams Gantt Charts focus on time Network Diagrams focus on dependencies 32

Critical Path Method (CPM) CPM is a network diagramming technique used to predict total project duration A critical path for a project is the series of activities that determines the earliest (or shortest) time by which the project can be completed 33

Calculating CPM First develop a good network diagram Add the duration estimates for all activities on each path through the network diagram Calculate the earliest expected completion time for each activity by summing the activity times in the longest path to the activity. This gives total expected project time Calculate the latest expected completion time for each activity by subtracting the activity times in the path following the activity from the total expected time. This gives slack time for activities Critical path – contains no activities with slack time  The longest path is the critical path 34

Calculating CPM (contd.) 35

Example 1: CPM (Activity-on-Arrow) 36

Example 2: CPM (Activity-on-Node) 37

More on CPM A project team at Apple computer put a stuffed gorilla on the top of the cubicle of the person currently managing a critical task Does the critical path contain all critical activities? Can there be more than one critical path? The critical path can change as the project progresses 38

39 Using the Critical Path to Compress a Project Schedule Three main techniques for compressing schedules: 1. Shortening 2. Crashing 3.Fast tracking

PROJECT COST MANAGEMENT 40

41 Table 7-1. Cost of Software Defects* It is important to spend money up-front on IT projects to avoid spending a lot more later. *Collard, Ross, Software Testing and Quality Assurance, working paper (1997).

42 Cost Estimating Project managers must take cost estimates seriously if they want to complete projects within budget constraints. It’s important to know the types of cost estimates, how to prepare cost estimates, and typical problems associated with IT cost estimates.

43 Cost Management Plan A cost management plan is a document that describes how the organization will manage cost variances on the project. A large percentage of total project costs are often labor costs, so project managers must develop and track estimates for labor.

44 Cost Estimation Tools & Techniques Basic tools and techniques for cost estimates:  Analogous or top-down estimates  Bottom-up estimates  Parametric modeling Tools  Computerized tools : Tools, such as spreadsheets and project management software, that can make working with different cost estimates and cost estimation tools easier.

45 Using Software to Assist in Cost Management Spreadsheets are a common tool for resource planning, cost estimating, cost budgeting, and cost control. Many companies use more sophisticated and centralized financial applications software for cost information. Project management software has many cost-related features, especially enterprise PM software.

46 Types of Cost Estimates for a project

Estimate Accuracy Over Time 47 As time progresses, cost estimates become more accurate

Function Point Analysis 48

49 Constructive Cost Model (COCOMO) Barry Boehm helped develop the COCOMO models for estimating software development costs. Parameters include:  Function points  Source Lines of Code ( SLOC ) Boehm suggests that only parametric models do not suffer from the limits of human decision-making.

50 Typical Problems with IT Cost Estimates Developing an estimate for a large software project is a complex task that requires a significant amount of effort. People who develop estimates often do not have much experience. Human beings are biased toward underestimation. Management might ask for an estimate, but really desire a bid to win a major contract or get internal funding.

51 Project Portfolio Dashboards

Keys to Estimation Utilize historical project information Follow an estimating methodology Get the right person to do the estimating 52