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Project Management C13PM
Session 5
Introducing Breakdown Structures
Russell TaylorBusiness Department
Staff WorkroomE-mail: [email protected]
Business Department 2
Session 3
• Breakdown Structures
• Organisational Breakdown Structures– Functional– Project– Matrix
• Work Breakdown Structures• Cost Breakdown Structures
Business Department 3
Project stakeholders
Business Department 4
Project Organisation
• Understand participating organisation– Project team – Key stakeholders – External organisations
• Participation mix– Internal, External or Internal & External
• Levels of authority• Communication channels • Contractual links • Define the project boundary
Business Department 5
Organisation Breakdown Structure (OBS)
• 3 types – Functional– Product / Project– Matrix
Business Department 6
Functional OBS
Chairman
Operations Director
FinancialDirector
MarketingDirector
SalesDirector
DevelopmentManager
Administration Manager
MarketingManager
SalesManager
Materials Manager
ProductionManager
TeamLeader
TeamLeader
Operative Operative Operative
Project Champion
Business Department 7
Functional OBS
• Advantages– Efficient use of collective experience & facilities– Institutional framework for planning & control– All activities receive benefit from most
advanced technology– Allocate resources in future anticipation of
business– Effective use of common elements– Career continuity & growth for personal
development– Well suited for mass production of items
Business Department 8
Functional OBS
• Disadvantages– No central project authority– Little or no project planning & reporting– Weak interface with customer– Poor horizontal communications across
functions– Difficult to integrate multidisciplinary tasks – Tendency of decision to favour strongest
functional group
Business Department 9
Product/Project Structure
Director
Manager Product A
ManagerProduct B
Manager Product C
MarketingManager
DevelopmentManager
MaterialsManager
MarketingManager
DevelopmentManager
MaterialsManager
MarketingManager
DevelopmentManager
Materials Manager
Operator
Operator
Operator
Operator
Operator
Operator
Operator
Operator
Operator
Business Department 10
Product/Project OBS
• Advantages– Strong control by single project authority– Rapid reaction time– Encourages performance, schedule and cost
tradeoffs– Personal loyalty to a single project– Interfaces well with outside units– Good interface with customer
Business Department 11
Product/Project OBS
• Disadvantages– Inefficient use of resources– Does not develop technology with eye on the
future– Does not prepare for future business– Less opportunity for technical interchange
among projects– Minimal career continuity for project personnel– Difficulty in balancing workloads as projects
phase in & out
Business Department 12
Matrix / Project OBS
Director
Operational Manager
Project Manager A
Financial Manager
Marketing Manager
Project Manager B
Project Manager C
Projects Director
Business Department 13
Matrix Project OBS
• Advantages – Combines strengths of functional and project-
oriented organisation – Good interface with outside contacts– Effective multidisciplinary task integration– Effective use of production resources– Effective project control– Career continuity and professional growth– Perpetuates technology
Business Department 14
Matrix Project OBS
• Disadvantages – Profit-and-loss accountability difficult – Dual accountability of personnel– Conflicts between project & functional
managers
Business Department 15
Matrix / Project OBS
Director
Operational Manager
Project Manager A
Financial Manager
Marketing Manager
Project Manager B
Project Manager C
Projects Director
Business Department 16
• Weak– project managers
have little or no executive authority
– cannot make decisions concerning functional resources
– are largely dependent on the goodwill and co-operation of the functional managers to achieve success
• Strong– traditional boundaries
have diminished importance
– the dominant focus is the business processes and the customer
– projects deliver end products and services to customers and so are given priority over functional managers
Two Possible Matrix Outcomes
Business Department 17
Development Planning
• Generate Activities – Work Breakdown Structures
• Define Resources• Determine Responsibilities
– Responsibility Assignment
• Developing Project Budget
Business Department 18
Work Breakdown Structure - 1
• A WBS identifies the total scope of the project broken down into manageable work packages and tasks– Project Chunking
• Impossible to manage the “whole”– Groups those tasks into a logical hierarchy.
• Often shown in two different forms:– Chart form
– Tabular form
Business Department 19
Work Breakdown Structure - 2
• Progress of each activity can be monitored and charted– Can be used to curb any unrealistic expectation
that the sponsor may have
– Can also be used for cost accounting
– Allows for development of project schedules
• First stage in identification of activities, schedules & budgets
Business Department 20
WBS Party
Party
Venue Entertainment Refreshments
Decoration Live DJ Food DrinkFurniture
Hot Cold
Business Department 21
Work Breakdown Structure
Level 1 House Refurbishment
2.0 Services1.0 Management 3.0 Decorating 4.0 Fixtures
Level 2
1.1 Planning
1.2 Costing
1.3 Specify
2.1 Electrical
2.2 Plumbing
3.1 Floors
3.2 Walls
4.1 Kitchen
4.2 Bathroom
Level 3
1.1.1 Programme
1.1.2 Resource
1.2.1 Budget
1.3.1 Specification
2.1.1 New wire
2.1.2 Re wire
2.2.1 Water
2.2.1 Gas
3.1.1 Carpets
3.1.2 Laminate
3.2.1 Paper
3.2.2 Paint
3.1.1 Appliances
3.1.2 Units
3.2.1 Suite
3.2.2 FixturesLevel 4
Business Department 22
WBS CODE
• Generates a logical directory order1.1 Main Activity
1.1.2 Sub activity1.1.2.1 Sub-sub Activity
1.1.3 Sub activity1.1.3.1 Sub-sub Activity1.1.3.2 Sub-sub Activity
• Creates Project plan index page • Provides template for cost spreadsheet• Provides template fore resource assignment• Provides template for specification
Business Department 23
KeyX-eXecutes the workD-takes Decision solelyd-takes decision jointlyP-manages ProgressT-provides Tuition on the jobC-must be ConsultedI-must be InformedA-available to AdviseIssue/Date:Approved by:
Code
Activity/Task NameDevelop milestone plan PXXIDDCreate high level networkPX XDevelop new activity schedulesDPXXIUpdate network PCCXIssue work-to lists IXDo work PPXXReturn turn-around documentsIPXIActivity review meeting IPXXIdentify variances (activities)DPPXXPlan recovery PIXXIIssue activity progress reportsPXXReview progress against milestonesPX XIMilestone progress meetingPX XXIdentify variances (milestones)PX XDXPlan recovery PXXXDIssue milestone progress reportPX XCIApprove progress D
Proje
ct M
ana
ger
Team
Leader
s
Proje
ct M
em
bers
Proje
ct S
upport
Offi
ce
Steerin
g C
om
mitt
ee
Proje
ct S
pons
or
Responsibility Chart (
Responsibility Assignment Matrix)
Business Department 24
Integrating OBS & WBS
Software Development
1.0 Programming 2.0 Technical Data 3.0 Packaging
1.1 Activity 3.1 Activity1.2 Activity
1.1.2 Activity 1.1.3 Activity
YK2 Plc
Design Team
Technical writers
Marketing
Control Account
Business Department 25
Cost Breakdown Structures
Software Development
1.0 Programming 2.0 Technical Data 3.0 Packaging
1.1 Activity 3.1 Activity1.2 Activity
1.1.2 Activity 1.1.3 Activity
Labour
Total Cost
Material Equipment
YK2 Plc
Design Team
Technical writers
Marketing
Cost Breakdown Structure (CBS)
Business Department 26
Work breakdown structure
1.1.1 New pipes
1.1.2 Boiler
1.1 Radiators1 week£3000
1.2.1 Replace pipes
1.2.2 Water tank
1.2 Kitchen1 week£2000
1.0 Plumbing& Heating2 weeks£5,000
2.1.1 Sockets
2.1.2 Lighting
2.1 Rewire2 days£1000
2.2.1 Garage
2.2.2 New sockets
2.2.3 Uplighter
2.2 New wire3 days£500
2.0 Electrical1 week£1,500
3.1.1 Bedroom 1
3.1.2 Bedroom 2
3.1.3 Living room
3.1.4 Hall
3.1 Carpet2 days£2000
3.2.1 Bathroom
3.2.2 Kitchen
3.2 Tiles3 days£1000
3.0 Flooring1 week£3000
4.1.2 Hob & oven
4.1.3 Worktop
4.1.4 Units
4.1 Kitchen2 days£5000
4.2.1 Bath
4.2.2 Shower
4.2.3 WC
4.2.4 WHB
4.2 Bathroom3 days£2000
4.0 Fixtures1 week£7000
5.1.1 Living
5.1.2 Bedroom 1
5.1.3 Bedroom 2
5.1.4 Bathroom
5.1.5 Kitchen
5.1.6 Hall
5.1 Rooms2 weeks
£600
5.0 Decoration2 weeks
£600
HOUSE REFURBISHMENT7 weeks£18,000
Business Department 27
Integrating the OBS & WBS
WBS Code Cost Sub-total Total Resource
2.0 SERVICES
2.1 Electrical Electrician
2.1.2 New Wire
2.1.2.1 Lounge £500.00
2.2.2.2 Garage £500.00
£1000.000
2.1.2 Re-wire
2.1.2.1 Kitchen £600.00
2.1.2.2 Bedroom £300.00
£900.00
£1900.00
Business Department 28
Take a break
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