Download - Bussiness planning process

Dr f Dejahang (BSc CEng, BSc (Hons) Construction Mgmt, MSc, MCIOB, PhD)

027027PROJECT PROJECT

MANAGEMENT &MANAGEMENT &BUSINESS BUSINESS PLANNING PLANNING PROCESSPROCESS

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PROJECT MANAGEMENT BUSINESS PLANNING PROCESS

• Building and civil engineering projects carry uncertainty and risk.• Organisations under take RISK when

they need to achieve their business objectives more effectively.• Expand ONLY when the potential

benefits out weight the risk involved.


• All projects should therefore arise from a need to fulfil two main factors such as:

1. Specific Strategic Objectives

2. Achieve competitive advantages


The business planning process

has four essential steps:

Remember ‘MOST’


DEFINE THEBUSINESSMISSION

SET LONG TERMOBJECTIVES 5-10YEARS TO ACHIEVETHE MISSION

DEVELOP STRATEGIESTO ACHIEVE THEOBJECTIVES-INTERMIDIATE GOALS,BUDGETS,STRATEGIC PLANS

SHORT TERMGOALS, INDIVIDUALPLANS FORPROJECTS/OPERATIONS

MMMISSION LLLLLLL

OOBJECTIVES

SSTRATEGIES

STACTICS


The business planning process hasfour essential steps: Mission Statement• States the reason for the organisations

existence; • Initiates the business planning

process;


Objectives are:• The position; • In quantities terms;• In qualitative terms;• that the organisation wishes to

reach;• Must be in a stated period of time.


Strategies to consider:Design to achieve the objectives such

as: • A set of budgets • Clear goals • Achievable targets • Statement for needs.


Covering all aspects of the businesssuch as:• People • Premises • Organisations • Capital • Cash.


Tactical plansIndividual plans to achieve items such as:• Defined goal • Operations and Projects

The plan describes how the organisation will achieve each element of the strategic plan.

Tactical plans


Another way to look at Business plan

Remember ‘COST’• C Commitment by all concerned to the project• O Objectives being clear to all-Scope and

Mission • S Strategy to meet the objectives-Milestone Plan• T Tactical-activities found necessary to achieve

to each milestone and solve Problems

Project conception process

POLITICAL LEGAL INSTITUTIONAL

SOCIOLOGICAL TECHNOLOGICAL ECONOMIC

INFORMATION, ENERGY,MATERIAL

MOTIVATION STARTPOINT

INFORMATION, ENERGY,MATERIAL

Disposal of assets

Adaptation to external influence

Exam

ples

of in

itial

Feas

ible

Decis

ions

Project inception process



INFORMATION, ENERGY, MATERIAL


Construct a new building

Exam

ples

of i

nitia

l Fea

sible

Dec

ision

s

Goal Time

SatisfactionofObjectiveRequired TheAcquisitionofRealProperty

A contribution to the client's objective through the acquisition of real property

P7Project inception process





Final Finish Point

Fini

sh sp

ectru

m

Goal Time

The realisation of a new building

The project realisation process

ConstructA NewBuilding

FUNCTION OF PROJECT MANAGEMENT


• The basic Management Principles described by Henri Fayol are:

• To plan• To organise• To co-ordinate• To control• To lead

FUNCTION OF PROJECT MANAGEMENT The function of ProjectManagement in more detail are:

• To establish the clients objectives and priorities issues such as:–brief formulation;–client organisation;–approval powers.


Design Project Organisation Such as:• organisation chart;• decision point;• Relationships;• feed back.


Integrate Client into theproject• client organisation integrated

into project organisation;• people responsibilities;• decision processes.


Selection and appointment ofContributors• identify contributors;• identify input required;• identify when input required and

duration;• record types of appointment.


Full brief formulation process• Establish need, budget, cost

plan, cost limit, procurement route.

• Start value engineering• Programme formulation• The overall project programme

Initial ConstructionCost

Additional Cost throughunnecessary

sketch design andspecification

features

Additional Cost throughinefficient Constructionmethods and techniques

Contractors Overheadthrough labour andmachinery lying idle

TotalConstruction

Cost

costofBuildingEntity

VEapplication

ManagementReviewTechniques

PlanningControlProcedures

Typical Spectrum of a cost ReductionProgramme in the Building Industry Timing of V.E. study during the design stages

SketchDesign

Design Development

Approval

DocumentationDevelopment

Approval

Approval

ConstructionProcess

Yes

Yes

Yes

No

No

No

PreliminaryDefinition

RefinementofDesign

Workingdrawings

V.EAPPLICATION 1

V.EAPPLICATION 2


The phase or stage programme• The design programme.• The procurement programme. • The construction programme.• The commissioning

programme.


Activation of the relationships between contributors

• Ensure contributors are brought in and integrated into the project organisation.

• Ensure contributors can perform as required.


Establish appropriate informationand communication structure by: establishing a full project

procedures

manual containing;• description of formal

communication cannel;


• change requests and instructions;• drawings framework;

• co-ordination project information system;• Address index of all

contributors.


Convening and chairing meetingsof contributors at all stages suchas:• Judging the need and frequency;• Who needs to attend;• Agenda setting;• Minutes and action.


Monitoring and controlling• Pro-active role;• Obtaining feedback and under taking

analysis;• Testing outcomes to objectives and

taking corrective action;• Forecasting;• Integrating and controlling contributors.


Managing completion• Commissioning programme;• Training of user;• As built drawings-user maintenance

manuals;• Strategy for occupation or disposal.Evaluation of outcomes• Success in achieving objectives;• The final feedback loop;


SYSTEMATIC APPROACH TO ANYPROJECT • Royal Institute of British Architects

(RIBA PLAN OF WORK)

TACTICAL PLANS

M is s io n 5y e a rs

o b j e c tiv e s

S tra te g ie s

T a c tica lp la n s

T a c tica lle v e l( a c tiv itie s )

S tra te g ic le v e l( m ile s to n e s )

I n te g ra tiv ele v e l

( p u rp o s e a n do b j e c tiv e s

R E L A T I O N S H I P B E T W E E N C O R P O R A T E P L A N A N D P R O J E C T P L A N

P ro j e c t M is s io n , S co p e , O rg a n iz a tio n

M ile s to n e sE v e n t o r ie n ta te d

A c tiv ity o r ien ta te d

RIBA PLAN OF WORKAppraisal 1 Carry out studies to determine the

feasibility of the Client's requirement.

2 2A Review with client alternative design and construction approaches and the cost Implications.

3 2B Provide information for report on cost implications.

RIBA PLAN OF WORKB Strategic Brief 1 Receive strategic brief prepared by the client.

C Outline Proposals 1 Commence development of Strategic Brief into

Project Brief

2 Prepare Outline Proposal

3A Provide an approximation of construction costs. OR

3B Provide information for cost planning.

RIBA PLAN OF WORK

• 4 Obtain Client approval to Outline Proposals and approximate construction cost.

• 5 Co-operate with Planning Supervisor where applicable.

RIBA PLAN OF WORK

D Detailed Proposals 1 Complete developments of Project Brief.

2 Develop the Detailed Proposal from

approved Outline Proposals.

3A Prepare a cost estimate. OR

3B Provide information for preparation of

cost estimate.

4 Consult statutory authorities.

RIBA PLAN OF WORK• 5 Obtain Client approval to the

Detailed Proposal showing spatial arrangements, material and appearance, and a cost estimate. • 6 Prepare and submit application

for full planning permission.

RIBA PLAN OF WORKE Final Proposals• 1 Design Final Proposals from approved

Detailed Proposals. • 2A Revise cost estimate. • 2B Provide information for revision of cost

estimate. • 3 Consult statutory authorities on

developed design proposals.

RIBA PLAN OF WORK• 4 Obtain Client approval to type of

construction, quality of materials, standard of workmanship and revised cost estimate. • 5 Advise on consequences of any

subsequent changes on cost and programme.

RIBA PLAN OF WORK

F Production Information 1 Prepare production information for tender

purposes.

2A Prepare schedules of rates and/or quantities and/or schedules of works for tendering purposes and revise cost estimate. OR

RIBA PLAN OF WORK• 2B Provide information for preparation of

tender pricing documents and revision of cost estimate.

• 3A Prepare and make submissions under building acts and/or regulations for other statutory requirements. OR

• 3B Prepare and give building notice under building acts and/or regulations (not applicable in Scotland).

RIBA PLAN OF WORK• 4 Prepare further production information

for construction purposes.

G Tender documents 1 Prepare and collate tender documents in

sufficient detail to enable a tender or tenders to be obtained.

2 Where applicable pass final information to Planning Supervisor for pre-tender Health and Safety Plan.

RIBA PLAN OF WORK• 3A Prepare pre-tender costs. OR• 3B Provide information for preparation of

pre-tender cost estimate

H Tender Action 1 Contribute to appraisal and report on

tenders negotiations.

2 If instructed revise production information to meet adjustments in the tender sum.

RIBA PLAN OF WORKJ Mobilisation 1 Provide production information as

requested for the building contract and for construction.

K Construction to Practical Completion 1 Make visits to the works in connection with

the Architect's design.

RIBA PLAN OF WORK

• 2 Provide further information reasonable required for construction.

• 3 Review design information from contractors or specialists.

• 4 Provide drawings showing the building and main lines of drainage and other I information for the Health and Safety File.

RIBA PLAN OF WORK

• 5 Give general advice on operation and maintenance of the building.

L After Practical Completion.

1 Identify defects and make final inspections.

2A Settle Final Account. OR

2B Provide information required by others for settling final account.