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MB0049 Project Management

Q1. Discuss the various steps of PMIS planning. The success of a PMIS depends on its effective planning. The PMIS is used for many purposes by a project manager like budget estimation of costs, creating a schedule, define the scope, etc. Hence, these should be considered while planning for PMIS. The planning of PMIS includes the following steps: 1. Identify the information needed 2. Capture data 3. Process data into information and store it 4. Communicate information to stakeholders Identify the information needed Identification of the information that is needed is necessary for improving the decision making and the structure of the PMIS. information requirements of project stakeholders include the recipients of information, the type of information that is needed, which includes format, contents, and level of details, the time the information is required and how (by what media) will it be communicated to them. Capture data Term Capture data" is used to state a process of preparing and collecting data i.e., as element of a process improvement or similar project. The function of data collection is to attain information to maintain record, to make decisions for vital issues, and to pass information on to others. Data can come from actual observation or from records. Data collected from records is known as secondary data. Data collected from direct observation is known as primary data. It should be ensured that all relevant groups are represented in the data. A formal data collection process is essential as it makes certain that the gathered data are both defined and precise and that subsequent decisions based on opinion embodied in the findings are valid. Data possibly be arranged in tabular form, data array or frequency distribution. Process data into information An organisation, to achieve its aims, needs to process the data collected into meaningful information. it should be presented in its most useful formats. Data must be processed in a context to give it meaning. Data is transformed into information using mathematical, statistical, or other tools including computer software. Information can be stored in electronic form or hard copies represented in the most useful form. Communicate information to stakeholders Communication is the process by which information is exchanged between individuals through a common system of symbols, signs, or behavior.

Q2. What are the different phases of contract management?


Contracting has three phases. They are:

Contract planning Contract negotiations Contract administration

Contract planning Contract planning should be done at the project schedule stage. The process of contract planning includes the preparation of resource plans. The following points should be considered for preparing the contract planning: - Work Break Down (WBS) and packaging - Requirement of resources, mainly equipment and manpower for various work packages - Type and numbers of contracts to be awarded and approximate to whom. - Technical, financial, and operational capabilities of the contractor - Scope of work for each contractual job - Method of contracting - lCB, LCB, open tender, limited tender, etc - Choosing among suitable and comparable parties - Obligations of both parties should be reasonable Contract negotiations The negotiator brings the buyer and the seller face to face. All assumptions and parameters related to price are analyzed. Eventually, a more realistic picture emerges, which is agreed to by both the buyer and the seller. The following aspects should be kept in mind at the time of contract negotiations. Price-related terms: Price could be fixed or adjustable during the contract period. Fixed price is generally applicable under stable market. Payment terms: Any of the payment terms which include advance, credit for specified period, cash on delivery, and retiring document through bank may be selected mutually. Delivery conditions: These may include which mode to be used, how much quantity to be delivered, and when. Agency for inspection: lt is to be agreed whether inspection is to be done by a third party or by buyers or supplier's own inspection. Cancellation: Cancellation of contract may be done due to default by the vendor in failing to perform as agreed in contract while making deliveries, convenience of the buyers, or mutual consent. in a situation where the seller is not at fault, it is to be ensured that he or she does not Suffer any loses. Quantity: Quantity may be fixed or variable in case of variable quantity; The lower and upper bound needs to be specified. Contract administration

Various problems may arise during the execution of the contract such as: Extra work including excess quantities of work Deleted work including lower quantities of work Non-compliance with specifications Delays in time schedules Late payments Taking over of completed works Warranties Contract close out As and when the problems arise, they must be sorted out immediately based on the provisions of the agreed contract.

Q3. Describe the process of project performance evaluation


It is very useful tool to find out the reasons behind a failure to achieve intended outcomes. The modifications that need to be made to a project can be determined by following the below steps: Project identification Identification of appropriate projects (or project ideas) is the first and the most important stage in project management. This is done through appropriate type of opportunity studies. Opportunity studies are indicative rather than detailed ones and are based on macro parameters and rough estimates. Such studies can be grouped into 3 categories: Area studies: About a given geographical area Sectoral studies: About specific economic sector such as power plants, food processing, etc. Resource-based studies: Studies about renewable and non-renewable national resources, industrial products like minerals, etc. Pre-feasibility studies After the identification stage, the project ideas are screened through pre-feasibility studies. Pre-feasibility studies are the intermediate studies between the opportunity studies and detailed project report. This is basically carried out to check for the viability of the project and have a rough estimate of the cost of project and profitability. An outline of a pre-feasibility study is given below: Executive summary About the report Project sponsor's background and history Location and site, for example, the report recommends the location landsite along with essential related activities and their cost estimates Requirement of raw materials and their sources Requirement of utilities and auxiliary services such as power, water, steam, compressed air, transportation, etc Selection of the conversion process (technology) Fixation of overall plant capacity based on technology selected

Selection of plant equipment and machinery based on capacity proposed An outline of the production process and plant layout Capital cost estimate Plant organisation and manpower requirement and their cost estimates Production costs Profitability analysis Construction schedule General layout and flow sheets (supporting drawings)

Detailed project report Techno-economic feasibility study Preparation of Detailed Project Report (DPR) is a further step in examining the feasibility of the project from all angles: Technical, financial, economical, managerial, and also the Environmental impact Analysis (EIA). This is a major proposal and is necessary as per government directives and is considered as bankable report based on which banks can advance loans. Appraisal and evaluation Appraisal and evaluation are essential parts of good financial management. The general principles should apply to any proposal whether project, programme, or policy related with implications for expenditure/use of resources. The effort that should go into them and the detail to be considered, however, is a matter of judgment. For example, the proposals involving modest expenditure/use of resources may merit less detailed appraisal and evaluation. The major techniques for financial appraisal criteria are: Pay Back period (PBP) Net Percent Value (NPV) Internal Rate of Return (IRR) Accounting Rate of Return (ARR) Cost-benefit ratio Cash flow considerations

Q4. Discuss the various elements of project control.


Any project aimed at delivering a product or a service has to go through phases in a planned manner in order to meet the requirements. It is very important to measure the performance of the current status of the project at anytime against its planned version. This helps to tackle any unexpected deviation in time, efforts and cost. It is possible to work according to the project plan only by careful and close monitoring of the project progress. It requires establishing control factors to keep the project on the track of progress. The results of any stage in a project, depends on the inputs to that stage. It is therefore necessary to control all the inputs and the corresponding outputs from a stage. This is achieved through devising proper controls for every stage. A project manager may use certain standard tools to keep the project on track. The project manager and the team members should be fully aware of the techniques and methods to rectify the factors influencing delay of the project and its product. It

is important for all stakeholders to know the impact of the changes in any parameters to the overall project. The various steps involved in monitoring and controlling a project from start to end are shown in figure Preliminary work The team members understand the project plans, project stage schedule, progress controls, tracking schedules, summary of the stage cost and related worksheets. All the members have to understand the tolerances in any change and maintain a change control log. They must realize the need and importance of quality for which they have to strictly follow a quality review schedule and frequently discuss the quality agendas. They must understand the stage status reports, stage end reports, stage end approval reports. Project Progress The members must keep a track of the project progress and communicate the same to other related members of the project. They must monitor and control project progress, through the use of regular check points, quality charts, and statistical tables; control the quality factors which are likely to deviate from expected values as any deviation may result in changes to the stage schedule. The project manager ensures that these changes are made smoothly and organizes review meeting with the project management group. Thus all the members are aware about the progress of the project at all times. This helps them to plan well in advance for any exigency arising due to deviation from planned schedule. Stage Control The manager must establish a project check point cycle. For this, a suitable stage version control procedures may be followed. The details are to be documented stage wise. Project files have to be timely updated with appropriate version control number and revision status should be maintained for each change. Team members are identified who will exercise controls at various points of the project. Resources Plan the resources required for various stage of the project well in advance. Communication is the key. Brief both the project team and the key resources about the objectives of every stage, planned activities, products, organisation, metrics and the project controls. This increases the visibility into the project performance and hence a quality control can be achieved. Allocating a right resource at the right place and the right time will significantly enhance the efficiency and effectiveness of the resource. Quality Control This is very important in any project. It is a tool which helps in tracking the progress of various parameters at any stage of the project. A project manager may use a standard quality control or customize according to the requirements. Quality control is possible if the project members follow the quality charts and norms very strictly. It is also important for all the project team members to know the importance of such quality checks and should have a good visibility into project performance. Schedule Quality Review Conduct quality reviews at regular intervals. It is recommended that quality review be scheduled at the beginning of the stage and also at the ending of every stage. This helps the project manager and team members to plan well in advance for any unforeseen deviation. Agenda for Quality Review

Create and distribute a quality review agenda specifying the objective, products, logistics, roles, responsibilities and time frame. This increases the effectiveness of the review and also reduces the time gap. Conduct Quality Review Conduct the quality review in a structured and formal manner. Quality review should focus on product development and its quality factors. Focus on whether it meets the prescribed quality standard. Follow Up Revise the complete quality review product status from In-progress to QR Complete. Follow up the actions planned in strict manner which ensures conformity to the standards. Review Quality Control Procedure Verify that the quality objectives for each product are appropriate and that all participants are satisfied both with the process and its outcome. This is to ensure that all the stakeholders of the project are in conformity of control procedures.

Q5. a. What could be the reasons for project termination?


Project termination is one of the most serious decisions of a project management team and its control board. The decision of project termination affects all the stakeholders of the project and can put some negative impaction the organizations growth. So it is important to critically evaluate all the aspects before taking the decision. The project manager and his or her team members will feel that they personally failed. It can also put a negative impact on the team members motivation level and their productivity. The following are the key reasons to terminate a project: Technological reasons Results of project requirements or specifications are not clear or impractical Fundamental change in project requirements or specifications, so that the underlying contract cannot be changed accordingly Lack of project planning, especially risk management The planned result or product of the project turn into obsolete, is not any longer needed Sufficient human resources, tools, or material are not accessible The increase in project cost leads lower profit than expected The parent organisation do not exist longer The change in strategy of parent organisation, leads towards the project does not support the new strategy Essential conditions disappear Lack of management support Insufficient customer support

b. Write a note on project follow up

Traditionally, this stage is considered as a part of project completion phase but now it is considered as a separate phase of project life cycle. This is particularly so in very political environments, and/or where project benets have relatively low visibility and meaning to stakeholders (staff, customers. Investors, etc), especially if the project also has very high costs. For example, ICT (Information and Communications Technology) projects often are like this - low visibility of benefits but very high costs, and also very high stress and risk levels too. After delivery or completion of the project, the staff performance has to be evaluated. The tasks involved in this phase are: Documenting the lessons learnt from the project Analyzing project feedback Preparing project execution report Analyzing the problems encountered during the project

Q6. Discuss the advantages of using PM software package. What are the common features available in PM software packages?
The following are the key advantages of using project management software: Speed, effort, and accuracy: For a large project, manually carrying out activities like drawing a network, carrying out time analysis, reporting project progress, generation of various types of reports, updating Network and maintaining records is quite time and effort consuming. Accuracy level is also below par. Use of the software package greatly reduces the time and effort needed for these activities and at the same time enhances accuracy. Ability to carry out special functions: The software has the ability to carry out some special functions like resource scheduling, what if experiment, and export and import of data with ease and within reasonable time. Manually carrying out these functions is extremely difficult or not feasible. Affordability: The price of PC-based software is under $500 which is affordable for an organisation. . Easy to use: Over the years, the project management software packages have become easy to use. The package can be handled with minimum training. Maintenance of record: A project generates a lot of data, reports, documents, etc. Manually archiving and retrieving these are time and effort consuming. The software package can handle these functions with relatively less time, effort, and cost. Common features Project data and calendar: A project start date is specified. A calendar can be used to define the working days and hours for each individual resource on a project. The calendar is used in calculating the schedule for the project. Most systems provide a

default for the standard working period, such as Monday to Friday from 8:00 AM to 5:00 AM, with an hour for lunch. The calendar can be modified for each resource. Human resources: Suppose a particular activity needs 2 unskilled person and 1 skilled person to complete the task. These two resources may be entered separately and will appear as 2L and 1S on activity description in network. Labor cost: One of the many ways to specify labor cost is as, Skilled worker -- $ 2.0 Unskilled worker -- $1.2 o Human resources available: All software requires periods and amount of resources that are available for the project. o Cost of construction materials: Materials needed for each task and their estimated costs for the project o Project data and calendar: A project start date is specified. A calendar can be used to define the working days and hours for each individual resource on a project. The calendar is used in calculating the schedule for the project. Most systems provide a default for the standard working period, such as Monday to Friday from 8:00 AM to 5:00 AM, with an hour for lunch. The calendar can be modified for each resource. For example, work hours can be modified, company holidays can be entered as non-working days, and various shifts can be entered. Human resources: Suppose a particular activity needs 2 unskilled person and 1 skilled person to complete the task. These two resources may be entered separately and will appear as 2L and 1S on activity description in network. Labor cost: One of the many ways to specify labor cost is as, Skilled worker -- $ 2.0 Unskilled worker -- $1.2 Human resources available: All software requires periods and amount of resources that are available for the project. Cost of construction materials: Materials needed for each task and their estimated costs for the project may be as given below: Activity identifier: Each activity of the project is assigned a code or identifier. Activity description: Each activity has a description. The number of characters should be within the number of characters specified by the software for the activity name field. Precedence relationship: There are various options to show the

linkage between two consecutive activities in a network. One common option is Finish-Start type. It means that the succeeding activity can start only if all preceding activities to it have been completed. This option (Finish-Start type) is the default option in all project management software today for linking two activities. Figure 14.1 depicts the various options for linking activities. These are quite useful in reflecting the real-world situation in network. Data entry error: All good management software contains error detection routines that identify and reports errors. However, there are certain errors which cannot be detected by software. These include: An incorrect activity duration An incorrect activity name Graphics: For a project involving a large number of activities, drawing a correct network, manually takes a lot of time and effort. One of the important features of PM software is its ability to generate a variety of charts including network diagram, activity-linked Gantt chart, and Gantt chart quickly. Further, changes in base line plan are quite easy. Time analysis: If there is unlimited and flexible resource or if resource can be outsourced, the network may be prepared at the earliest start time of activities. In the real world, many projects are managed on this basis. PM packages carry out time analysis which includes calculation of early start, early finish, late start, and late finish; free slack and total slack with ease. Manually carrying out time analysis is tedious. Resources scheduling: Resources scheduling problems are of two types: o Resource leveling where unlimited and flexible resources are available o Resource allocation problem where resources are limited In resource leveling, activities are scheduled to minimize the variation in level of resource deployment. Resource allocation problem is concerned with scheduling activities in such a way so as to find the shortest project schedule. The project management software uses heuristics to solve both types of problems. For a moderate size problem involving 100 activities, it becomes extremely difficult to carry on resource scheduling. PM software is an invaluable tool to deal with this problem. Output reports: Most PM software packages have extensive report generation capabilities. They can generate a range of reports in various forms (graphical, tabular, or textual). The reports are standard or customized. The content of each report for a recipient is based on a "need-to-know

basis" and is presented in a particular order. These requirements are met by two features of the software namely, filtering (editing) and sorting. Filtering enables the user to select only certain data that meet some specified criteria. Sorting, on the other hand, allows the user to view information in a desired order such as pay rates from highest to lowest or in alphabetical order. Most software allows multiple level of sorting (for example, by year and then by dates). Among the reports generated by the software include: Project schedule: Network (based on AON systems), linked Gantt chart, Gantt chart o Work-to list Cost related report: Budgeted vs. actual cost (daily and cumulative) o Resources utilization report Progress report: Overall project, milestone chart, critical path o Chart showing responsibility of department/function to carry out particular activities o Progress summary report Updating: Updating is the process of producing a fresh set of schedule and other reports to take account of one or more of the following: o A change to the project parameter, an unexpected increase or decrease in the resource available, changed cost rate, or new target dates. o A change in network logic due to change in project scope, design change, etc. o To have a new schedule that take into account the progress made to date. Importing/exporting: The process of bringing information into the PM software from other application such as word processing, spread sheet, etc is called importing. Similarly, sending information from PM software to other application is called exporting. The exporting and importing obviates typing/data entry effort and eliminates the possibility of associated error. Project monitoring and tracking: Tracking the progress about schedule and cost is an important aspect of project management. Most PM software packages permit the users to define a baseline plan and compare the actual progress with respect to those in the baseline plan. What if analysis: This is a useful feature of PM software. This permits to know the effect of changes in project variable (people, cost, and change in scope) on project objective. This analysis helps the project manager in taking an appropriate decision.