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Planning:
Process of choosing the method and
order of work

Scheduling:
Process of determining the interrelationship
of associated timings of operations.


( Splitting of the project into work activities

( Determining logic relationships/interrelationships
between activities.
( Construction of Network Diagrams.
( Assigning durations to work activities.
( CPM Calculations resulting in start times, finish
times and float calculations of activities.
( Marking of critical Path
( Construction of Bar Charts / Time phased
diagrams.
 !

- An element of work performed during the

course of a project. Or
An amount of work that can be identified so that
we know what it involves and can recognize,
when it starts and finishes.

- An activity normally has an expected duration,

an expected cost, and expected resource
requirements
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( Any schematic display of the logical relationship

of project activities.
( Always drawn from left to right to reflect project
chronology.
( Usually a combination of arrows and nodes.
( Mainly of two types:
1. Arrow Diagram
2. Node Diagram / Precedence Diagram
"$%

( Activities shown by Arrows. Relationship

between activities shown by nodes / events.
( Length of arrows does not obey any scale.
( Start-to-finish relationships.
( Dummies.
( Numbering of nodes / events.
( Milestones
Use of Dummy Activity
 !$
( Activity duration is forecasted by any of the several means, including:
(1) Check Past Records.
(2) Check Standards and / or cost guides, if available.
(3) Ask the workers, who will do it
(4) make an educated guess

( Any time units may be allotted to activity durations like days, hours,
weeks, months, shifts, etc.

( In CPM, a single duration is forecasted for an activity.

( In PERT (Program Evaluation & Review Techniques), 3 durations are

forecasted for an activity and mean taken by weighted average method.
Then, Project¶s Duration or any Event Completion Time is calculated by
probability distribution.
@&

- Calculates the following for each activity

EST = Earliest Starting Time
EFT = Earliest Finishing Time
LST = Latest Starting Time
LFT = Latest Finishing Time
TF = Total Float
FF = Free Float
- Total Float is Maximum time for which an activity can be
delayed without delaying the project.
- Free Float is maximum time for which an activity cane be
delayed without delaying the start of proceeding activity.
- Total Float = Free Float + Interfering Float
@

( The path (or paths) in the network diagram,

from start to finish, on which all the activities
have zero total and free floats, is called
Critical Path.
( It is the longest path (or paths) from start to
finish in a net work diagram.
( It gives minimum normal time to complete a
project.
( It is usually marked by double lined arrows in
a network diagram.
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(ACTIVITY DESCRIPTION)
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( Activities shown by Nodes, relationship

between Activities shown by arrows or links.
( Easier to construct.
( Generally no need of dummies. Instead
dummies used only to give single start or
finish.
( CPM Calculations similar to Arrow diagrams.
'

( Gives Pictorial Representation of Activities.

( Activities begin at EST and show their EFT, FF,
TF, Durations, etc.
( Arrows at the relative ends to show dependency.
( Status Line Concept
( Unable to show complete interdependency
between Activities.
( Time-scaled Network Diagrams show complete
interdependency between Activities.
| 
 

COST MANAGEMENT

( Includes processes required to ensure that

the project is completed within the approved
budget.
( Processes involved are:
1- Resource Planning
2- Cost Estimating
3- Cost Budgeting
4- Cost Control
‰ @

Involves determining what physical

resources (people, equipment, materials etc)
and what quantities of each should be used
to perform project activities.
 @

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A deliverable-oriented grouping of project
elements that organizes and defines the
total scope of the project. It Identifies the
project elements that will need resources.
 
 
 


   
Contains the project justification and the
project objectives.
 @




 
'nowledge of what resources are
potentially available.
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The policies of the performing organization
regarding staffing and the rental or
purchase of supplies and equipment.
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To adopt different approaches for
the same problem.

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1. Resource Requirements:
Description of what types of resources
are required and in what quantities for
each element of the work break down
structure.
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( Developing an approximation (estimates) of

the costs of the resources needed to
complete project activities.
( Includes identifying and considering various
costing alternatives.
%@

( Cost Estimating involves developing an

assessment of the likely quantitative result-how
much will it cost the performing organization to
provide the product or service involved.

( Pricing is a business decision-how much will

the performing organization charge for the
product or service
%

( ork Breakdown Structure

( Resource Requirement
( Resource Rates:
scheduled or non-scheduled
( Activity Duration Estimates
( Historical Information
( Chart of Accounts:
Describes the coding structure used by the performing
organization to report financial information in its general
ledger
  )*%

- Analogous Estimating / Top-down Estimating:

Using the actual cost of a previous, similar
project as the basis for estimating the cost of
the current project. It is less costly but less
accurate. (Rough-cost Estimate)
- Parametric Modeling:
Using project characteristics (parameters) in
a mathematical model to predict project
costs.
  )*%

( Bottom-up Estimating:
Estimating the cost of individual work
items, then summarizing or rolling up the
individual estimates to get a project title.
(Detailed Estimate)
( Computerized Tools:
Use of computerized tools such as
project management software and
spreadsheets to assist with cost
estimating.

*%%

( Cost Estimates
( Supporting Details like Scope of work,
Calculation sheet, Assumptions made,
Possible range of results, etc.
( Cost Management Plan describing how cost
variances will be managed.
'

Allocation of overall cost estimates to

individual work items in order to establish a
cost baseline for measuring project
performances.
'

( Cost Estimates
( ork Breakdown Structure
( Project Schedule
  )*'

Tools and Techniques for developing project

Cost Estimates are used to develop budgets
for work items as well

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( Cost Baseline
A time-phased budget that will be used to
measure and monitor cost performance
on the project. It is developed by
summing estimated costs by period and
is usually displayed in the form of an S-
curve.


Cost Control is concerned with

(a) Influencing the factors which create
changes to the cost baseline to ensure that
changes are beneficial.
(b) Determining that the cost baseline has
changed
(c) Managing the actual changes when and
as they occur


Cost Control includes:

- Monitoring cost performances to detect
variances from plan.
- Ensuring that all appropriate changes are
recorded accurately in the cost baseline
- Preventing incorrect, inappropriate, or
unauthorized changes from being included in the
cost baseline.
- Informing appropriate stakeholders of authorized
changes.


( Cost Baseline
( Performance Reports
Provide information about cost performance
such as which budgets have been met and
which have not. It also alerts the project team
to issues which may cause problems in the
future.


( Change Requests
These may occur in many forms-oral or
written, direct or indirect, externally or
internally initiated, and legally mandated
or optional. These may require increasing
the budget or may allow decreasing it.
  )*

( Cost Change Control System

It defines the procedures by which the cost
baseline may be changed. It includes the
paperwork, tracking systems, and approval
levels necessary for authorizing changes.
( Performance Measurement
It helps to assess the magnitude of any
variations which do occur.
  )*

( Additional Planning
Perspective changes may require new or
revised cost estimates or analysis of
alternate approaches.

( Computerized Tools

*%

( Revised Cost Estimates

( Budget Updates
( Corrective Action
( Estimate at Completion
It is a forecast of total project costs based
on project performance.
( Lessons Learned
  | | |
 

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PROJECT PROFITS
1) Client payments.
2) Sale of surplus or scrap material and plant
3) Payments for plants or labor by others, where, this plant or labor is ,
from time to time not required for the project.
PROJECT LOSSES
1) Labor and site office costs
2) Plant costs
3) Site overheads i.e. site facilities, access roads and office etc
4) Cost of tendering including bonds, insurance, etc.
5) Material costs.
6) Head office overheads proportioned over all current projects.
  | | |
 

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Comparison is basically done according to the following
bases:
1) According to units of production
2) According to line items; e.g., labour, material,
equipment, overheads, ---

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