Introduction to Project Management Subject Code – PM0010

Assignment Set- 2(Book ID: B1236)

Q.1 what are the factors that both the buyer and seller should understand as forming a checklist for contract negotiations?

A.1 Contract Negotiation Techniques In a large project, for subcontracting a major portion of the project scope the project manager relies on the personnel in the purchase and/or contract department of the project organization. However, the project manager faces the need to understand and track the negotiating process to ensure that both the project needs and his organization’s needs are met in the outcome of the contract negotiations with the seller. Therefore, the needs to become familiar with negotiation techniques as well as negotiation skills, required in conducting the negotiations. Project contract negotiation is invariably a two-way street wherein the buyer seeks to exercise a good degree of control over the seller’s performance, as well as wants to maintain a harmonious relationship. Negotiating skills comprise a combination of hard skills and soft skills. Hard skills include product/service/technical knowledge, analytical/financial, computer literacy and legal aspects of contracting. The negotiation process itself comprises three phases, each of which requires careful planning and execution effort like planning the negotiation, conducting the negotiation and documenting the negotiation/forming the contract when the negotiation is successful. The checklists for the buyer and a checklist of contract best negotiation practices for an overall understanding of the negotiation techniques:

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Q.2. a. Derive the steps to develop a work breakdown structure of a project.

A.2.a. Work breakdown structure (WBS) is a fundamental component of project management process that helps in defining and organizing the total scope of a project using hierarchical tree structure. According to Project Management Body of Knowledge (PMBoK), „WBS is a deliverable-oriented hierarchical decomposition of the work to be executed by the project team to accomplish the project objectives and create the required deliverables‟. The hierarchy structure approach of WBS helps the project team to know the requirements of total project more accurately and specifically. WBS can also be used to assign responsibilities and allocate resources to the project. It helps the team to monitor and control the project. WBS is the critical input to various project management processes and deliverables like activity definitions, project schedule network diagrams, project and program schedules, performance reports, risk analysis and response, control tools or project organization. WBS has several levels in its hierarchy structure. These can be further used as an input to the scheduling process that supports elaboration of tasks, activities, resources and milestones which can be cost estimated, monitored, and controlled. Development of WBS WBS is a tool used in project management that defines a project and groups the discrete element of project in a way that helps to organize and define the total work scope of the project. A WBS element may be a product, data, service or any combination of it. WBS provides the necessary framework for

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detailed cost estimating, and controls it by providing guidance for schedule development Service or any combination of it. WBS provides the necessary framework for detailed cost estimating, and controls it by providing guidance for schedule development. WBS is a dynamic tool. It can be revised and updated as required by the project manager. Each descending level of WBS represents an increased level of detailed definition of the project work. The successful implementation of any project depends on the ability of the subject professionals such as project manager to break down a large project into smaller manageable sub-projects. The process of breaking down of mammoth projects into several smaller projects is called as work breakdown structure. Although not all successful projects have a work breakdown structure, there are enough reasons to go for WBS, since WBS:

Provides a framework for organizing and managing the approved project scope. Helps to ensure that the project team has identified all the activities and tasks that complete

the project. Provides a framework for planning and controlling the cost and schedule information.

It is very common that many organizations and companies‟ work on many projects simultaneously. Each project is competing for the limited resources available in the company. WBS helps in distinguishing the need of one project from the other within the organization. This helps the organization to identify resource requirements and allocate resources more effectively. While developing a WBS, one must know that there are multiple ways to develop it for a given project. One way of developing a WBS may be better than the other. The two most important things to remember are that the WBS must contain all approved scope and the project manager should ensure that the developed WBS reflects the way he/she intends to manage the project. The other items to be given importance while developing a work breakdown structure for a project are:

Reporting requirements. Size of the project. Resource executing the work or activities. Complexity of the project.

Q.2.b What are different steps or methodologies of project risk management?

A.2.b. Cost Breakdown Structure Cost of a specific project activity refers to the monetary value or financial pricing. It includes all anticipated expenditures that are expected to be part of the entire project, as well as the monetary value of the total sum of resources to be expended during the process. Cost estimation and control is vital for success of a project. This is the reason that Cost Breakdown Structure (CBS) is considered to be a major part of project breakdown structure. CBS describes how different cost elements contribute to the total cost of a project. According to Hundal1, “the contributions to the cost of a product can be estimated in a variety of ways. These breakdowns are expressed in the forms of cost structures”. A CBS is a document which outlines the criteria and activities that should be carried out as part of project management. It provides details about the input/output cost estimates and the amount of money being spent. It provides the plan and structure necessary to control costs of the project and keep them within the limits of the project budget. In CBS, a specific project cost is broken down into sub costs, which includes number of unique categories. The identified categories of cost breakdown structure include direct labour hours, indirect

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labour hours and other direct/indirect costs of the project. It also includes the purchased price of any specific materials and equipment which falls into resource cost category. In a business, providing a budget that is adjusted to time is referred as a cost baseline. It is the integral part of the cost breakdown structure. A cost baseline is an essential facet of the project management plan used by companies to ensure success of the project. Most larger projects have a variety of cost baselines which should be calculated. The basic cost baselines of a project are resources baselines and production variations baselines. These cost baselines measurement ensure that the cost is evaluated in regards to the overall yield of a specific project. CBS defines and arranges all relevant cost elements suitable for a specific project. It is a framework which shows the estimated cost requirement of the project divided among different activities of the project identified at work breakdown. There are five major forms of cost breakdown structures. They are:

Grouped on the basis of the components that the product is made of and thus following the bill of materials.

Divided on the basis of organizational departments. Divided based on the product functionalities which are very beneficial for a product

development purposes. Divided based on the various activities and operations of the project. Divided based on any desired way and then the result is arranged using the Pareto chart rule.

This indicates the most important and the least important cost elements from the desired point of view.

Q.3 Explain the steps to be followed to successfully implement the ISO 9000 standards in a company.

A.3 Quality is so important globally that the world is uniting around a single quality standard. International Organization for Standardization (ISO) 9000 is a set of universally understood and accepted quality practices which, when well implemented, give customers a confidence that suppliers can consistently meet their needs. The USA, through the American National Standards Institute, has adopted the ISO 9000 series, as the ANSI/ASQ Q9000 series. ISO 9000 is a set of standard written rules published by an international standards writing body. These rules define practices that are universally recognized and accepted for assuring that organizations consistently value and meet the needs of their customers. ISO 9000 is highly generic standard. The principles can be applied to any organization irrespective of product or service provided by them anywhere in the world. ISO 9000 specifies elements of a quality system. They do not provide implementation requirements. ISO 9000 has a handbook of quality standards and compliance. ISO 9000 is a de facto industry standard for quality assurance for any type of organization. ISO 9000 norms are considered as the generalized specification for quality assurance along with additional elements of total quality management. The ISO norms do not prescribe how the production and management should be organized, but simply states that an organization:

Defines and plans all its processes. Documents all the processes properly. Checks their capabilities. Ensures that they are reviewed and controlled.

The requirements of ISO 9000 goes much in detail, but when the above given simple principles are adopted in all the processes of the organization, then it is said to be 90% ISO ready.

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ISO 9001-9003 standard consists of number of management principles expressed in production terminology. This reflects the focus on the situations where suppliers are required to demonstrate their capability of guaranteeing the conformity to the product specifications to their industrial clients. The ISO 9001-9003 norms are highly process oriented which emphasizes on thorough planning, documentation, and control. The principles of quality standards of ISO 9000 can be summarized as:

The organization has clear quality objectives. There are clear agreements between everyone involved in a process. The organization has necessary resources to achieve the required quality level. The organization defines itself which processes and resources are necessary to achieve quality. All processes and systems are under control with the readiness for evaluation and modification

when needed. Everything required for quality assurance is documented Quality registration verification and proof for quality assurance is to be provided when needed.

Q.4 Summarize the basic essentials that the project management should be able to support.

A.4 Requisites of Project Management A project that deploys a traditional approach for implementing the applications finds it easier to implement the defined scope. However, when the project requires implementing applications that are new for the users, it is necessary that the following features are easily available1:

Name and general description of the application: This provides information such as the purpose of using the defined application. This outlines the primary objectives of the project that has to be met. It also includes information of the users using the application such as number of users using the application, areas of application, etc.

Software: It includes information such as the types of software available, the types of software required, the software version number, new releases, areas of applications, new technology and instructions for using the software.

Hardware: It provides information of the physical aspects or the equipments required for the project. It can also include computers, telecommunications and others.

Patching requirements: It involves requirements that are used to fix any uncertainties associated with the project.

Installation and configuration guidelines: It includes a set of standard procedures that can be referred in case of any problems such as installation errors, corrupted files and any other exceptional operation of the system as per the requirements of the project.

Application design: Representation of any information becomes readable and simple if the data is represented as a picture. Application design includes flowcharts and also determines the various dependencies of the task in the project. It includes flowcharts that are used to represent any process of the project by a different symbol with the defined meaning.

Monitoring and systems management: It includes information to monitor the work flow of the project to make decisions that benefits the organization needs. Monitoring also includes information about managing and maintaining the expected and available budget. It also encompasses information of managing the system for implementing the developed work.

Key support and maintenance items: It provides support and maintenance to handle projects of various sizes. It ensures that the project has resources available that best suits the wants of the company.

Back up: It facilitates provision of maintaining copies of the work to ensure that the information can be recovered in case of any failure or exceptions.

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Data retention and data archiving policies: Data retention maintains information about the legal records and business accounts that supports the project workflow. However, data archiving policies are the process of removing the selected data records from operational databases. Information can be stored in an archive and can be retrieved when needed. Archiving also facilitates to move the redundant and old data from working area to another data store.

Contingency and mitigation plans: It maintains a plan that ensures that any predictable or occurred risks are analyzed and solved in time. A contingency plan is a plan that includes various strategies and actions that helps in dealing with variances that are specific to a particular problem or emergency. The plans also facilitate monitoring of the unpredictable process and ensure that the planned actions are initiated.

It is a plan that is maintained as back up procedures, emergency response, and post disaster recovery. This ensures that the resources that are critical for the project is available and the flow of the project is maintained at any emergency situation. On the other hand the mitigation plans are also termed as „Risk Response Plan‟. The plan ensures that the risks that have already occurred should be handled with care and timely.

Service level documentation: It maintains information that serves as a guideline for the members of the team2. The various procedures and policies specific to the project are mentioned in this and can be referred by the team.

Lesson Learnt: During the project execution, the team goes through lots of experiences. All such experiences that can benefit the forthcoming projects and can avoid repetition of some mistakes in other projects should be clearly documented and circulated to the other projects at regular intervals.

Q.5 what do you understand by ethics and what is its role in project Management?

A.5 Decisions taken by project management have an impact on the quality of life of the stakeholders, as well as society. Business practices have been, and are subject to a number of instances of ethical mistakes. Favoritisms shown to specific suppliers/contractors in awarding the work, kickbacks, use of inferior quality materials, lack of safety measures causing injuries/fatal accidents to workers, issues concerning pollution of environment are issues which are receiving increasing attention from the society and are being debated in public forums. While ethics is a very general subject denoting rightful conduct and moral principles that are accepted by the majority of the members of society. Several business houses across the world including India are conscious of the ethics issues, and have implemented a Code of Ethics in their organizations. It must however be noted that organizations make their code of ethics a dynamic document to ensure broad ethical principles like adhering to applicable laws and regulations, identifying important ethical values that are prized by stakeholders (expectations of customers, vendors, general public, employees), identifying ethical values that are to be given high priority in the organization, getting feedback from the stakeholders, communicating the code to all employees in the organization, revising the code once a year. The specifics that the code of ethics includes would cover actions like using authority properly, protecting privileged information, taking responsibility for actions, avoiding acceptance of gifts, preventing conflict of interest, providing equal opportunity to employees, dealing with cases of employee harassment etc.

Q.6 briefly describes the different type of software management tools available in the market?

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A.6 Project Management products help the organization manage projects from the beginning to the end and also allow employees at different levels to contribute into the process. Multiple Functions Project management software has been in use for a number of years now and offers far more than just manage the projects themselves. Project Management applications also help in carrying out scheduling, cost control and budget management, resource allocation, collaboration, communication, quality management and documentation or administration. The main goal is to handle all the aspects and complexities of larger projects and help in reducing the costs. Target Audience The target audiences in project management software are the people involved in controlling and monitoring the project. For example in software projects the software measurement and metrics specialists, project managers, functional managers, testers, developers and other software project stakeholders who are involved in estimating and planning the software projects become the target audience. Types of Project Management Software Many types of project management software and tools are available in the market. Some are provided by well known companies like Microsoft while some are provided by small firms. There are even free and open source Project Management tools available which can be downloaded or used through a web browser. The Project Management software helps determine events that depend on one another what is the exact dependency level and the repercussions of things change or go wrong. Further, scheduling people to work on various tasks, and detailing the resources – physical, financial, etc is required, and is known as resource scheduling. There are different types of Project Management software applications available. Microsoft Project, Primavera is some of the popular tools. Project Management Software is used to deal with uncertainties in the estimation and duration of each task, arrangement of tasks to meet various deadlines and juggling of multiple projects simultaneously, as part of an overall objective. The different types of Project Management software are as follows:

Microsoft Project: This is the project management software developed and sold by Microsoft. It is one of the most accepted packages and offers a web interface and deep Office, Outlook and also Share point integration. It allows the project managers to develop plans, assign resources to tasks, track progress, manage budgets and also analyze workloads.

Match ware Mind View: This project management software is developed by MatchWare Company. It is easy-to-use spreadsheet-like layout and its mind map option allows the project in visuals, significant of brainstorming bubbles. This helps in taking notes, organizing ideas, planning reports and proposals, managing tasks, managing time, solving problem, meeting agendas and so on.

Project Kick start: This project management software is desktop software developed by Experience in Software, Inc. This is an easy-to-use Project Management package that communicates with other applications like PowerPoint, Outlook, Excel, Word, and Microsoft Project. This tells the users to identify the phases, aims, obstacles and also the personnel assignments for projects and also use a calendar to generate a Gantt chart which will feature the project’s phases and the goals.

Rational Plan Multi Project: This is a Project Management Software developed by StandBySoft.It has features that help manage resources and budgets as well as multiple projects. It has an

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interactive Gantt chart which is normally available only in higher-end suites. This also helps the managers to manage the company’s projects and resources in a centralized manner.

Base camp: This is a Project management Software developed by 37 signals. It is a low-cost web-based Project Management and collaboration package which is gaining momentum. This provides to-do lists, wiki style web-based text documents, milestone management, file sharing, time tracking and messaging system.

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