Download - Project Management Class ( based on PMBOK) - Day 5

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Project Management

Joe DiFalcoPMP, PMI-ACP, CSPO, Systems Engineer

Owner CVShout™

Profile: CVShout.com/joedifalcoContact: [email protected]

Review of the Project Management Body of Knowledge (PMBOK) 5th edition

Day 4 review Budget Earned value management Follow the Lifecycle – build a schedule

Knowledge Areas Ethics topics Stakeholder topics

Day 5 Agenda

From PMBOK 5th Edition

Note: the numbers in the chart refer to the chapter in the PMBOK

Review Cost Management Plan

• Responsibilities• Approach• Measurement• Reporting• Variance response• Change control

Example

Estimate Costs

Reserve analysis:• Account for cost uncertainty• Could be a fixed %, fixed number or some other calculation• CONTINGENCY reserve

• Allocated for identified risks or “known-unknowns”• Clearly documented• Part of the cost baseline

• MANAGEMENT reserve• Reserved for unforeseen work or “unknown-unknowns”• NOT part of the cost baseline but ARE part of the budget and funding requirements• Management reserves are added to cost baseline as they are approved/used

Determine Budget

• Aggregation of the estimated costs of individual activities (work packages)• Authorized cost baseline• Use this baseline to monitor and control project performance• Project budget includes ALL of the funds authorized to execute the project

• Cost baseline is the time-phased budget excluding MANAGEMENT reserves

Project Budget ComponentsKnown un-Knowns

un-Known un-Knowns

This is the level of granularity to track measurement

Project Budget Components

Reserves

Contingency vs Management reserves

Project Budget ComponentsAnticipated

Funds required to start

Projected disbursement points


Note: the numbers in the chart refer to the chapter in the PMBOK

Control Costs


• Monitor project status• In relation to the value of work accomplished

• Update project costs• Manage cost baseline• Recognize variance – take corrective action

Control Costs


Control Costs


Question: what actions would you expect to take to manage costs?

• Follow the management plan• Utilize OPAs that are available• Manage change –

• Prevent unnecessary change• Influence factors that cause cost to rise• Communicate approved change requests

Exam tips:• Control means measure• Measurement reveals variance – variance is analyzed • Cost management plan tells you what to do to control cost

Earned Value Management (EVM)


• Assess project performance and progress• Scope• Schedule• Resource measurements• Progress rules• 50/50 – activity is 50% when started• 20/80 – activity is 20% when started• 0/100 – activity is 100% when completed

• Integrates• Scope baseline• Cost baseline• Schedule baseline• Note: the Performance Measurement

Baseline (PMB) is the combination of these

Planned Value (PV)


The approved budget for the work scheduled to be completed by a specified date.

• Scheduled work• Work for an activity (work breakdown component)• Defines the physical work that SHOULD have been

accomplished• Total of all PV can be referred to as:

• Total PV is also: budget at completion (BAC)

Earned Value (EV)


The approved budget for the work actually completed by the specified date

• Measure of work performed• Based on PV (authorized budget)• Percent complete of a project• EV cannot be greater than PV• Monitored:

• Incrementally – for current status• Cumulatively – performance trends

Actual Cost (AC)


• Realized cost incurred• Cost of work performed during a time period• Specific to the work that the EV measured• Corresponds to what was planned – PV• Has no upper limit – it is what it is

Earned Value


Formulas to memorizeSchedule Variance (SV)


Formulas to memorizeCost Variance (CV)


Formulas to memorizeSchedule Performance Index(SPI)


Formulas to memorizeCost Performance Index(CPI)


Formulas to memorizeEstimate at Completion(EAC)


Formulas to memorizeEstimate to Complete (ETC)


Formulas to memorizeTo Complete Performance Index(TCPI)


Formulas to memorizeVariance at Completion(VAC)


Earned Value Measurement


Examples



Exercise



Status after 1 hour



Use EVM to forecast

Develop Schedule


Construct a House

Ethics


Code of Ethics andProfessional Conduct

Stakeholder Management


Identify Stakeholders


Inputs

Identify StakeholdersTools & Techniques

Stakeholder AnalysisTools & Techniques


Identify Stakeholders


Outputs

Plan Stakeholder Management


Inputs



Tools & Techniques



Outputs

Manage Stakeholder Engagement


Manage Stakeholder EngagementInputs Comm Mgmt

Stake Mgmt



Tools & Techniques


Outputs

Control Stakeholder Engagement


Inputs

Tools & TechniquesOutputs

Download - Project Management Class ( based on PMBOK) - Day 5

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