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Project management
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1
The Work Breakdown Structure
Prof. Mauro Mancini
e-mail: [email protected].: +39-02-23994057
POLITECNICO DI MILANODepartment of Management, Economics and Industrial Engineering
Project and Programme Management A and B
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Agenda
•The Work Breakdown Structure
•Examples of WBS
•Development methods
•Construction rules
•WBS quality principles
•Other Breakdown structures
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Work Breakdown Structure
The purpose of the WBS is to sub divide the scope of workinto manageable work packages which can be estimated,planned and assigned to a responsible or department.
It is the best tool for quantifying the scope of work as a listof work packages since is a hierarchical form of mind mapwhich helps to break complexity down to simplemanageable components.
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Work Breakdown Structure
It is not the activities needed to create the projectdeliverables; it's the stuff that the activities create.
A WBS is not the work, but the deliverables. MicrosoftProject suggests WBS as the activity list, but it isn't so. A WBSis not the activities but the actual deliverables that thecustomer expects from the project work.
The project scope must be decomposed into things that thecustomer will get as a result of the project. Stuff, notactivities. The end result of the WBS is a clear picture ofwhat the customer will and won't get as part of the project.
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Work Breakdown Structure
A Work Breakdown Structure is a deliverable-orientedgrouping of project elements that organizes and defines thetotal scope of the project: work not in the WBS is outside thescope of the project.
As with the scope statement, the WBS is often used todevelop or confirm a common understanding of projectscope. Each descending level represents an increasinglydetailed description of the project elements.
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Work Breakdown Structure
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Work Decomposition
The WBS should not be confused with the method ofpresentation—drawing an unstructured activity list in chartform does not make it a WBS.
Each item in the WBS is generally assigned a uniqueidentifier; these identifiers are often known collectively asthe code of accounts.
The items at the lowest level of the WBS are often referredto as work packages (minimum point at which the cost andschedule of the work can be reliably estimated).
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Work Decomposition
Developing a WBS is a meaningful exercise if you areequipped with the following information:
•Project scope statement
•Project workflow
•Voice of the customer
•Pool of available resources
•Project situation
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Work Decomposition
Decomposition may not be possible for a deliverable that must beaccomplished far into the future.
The Project team usually waits until the deliverable is clarified to bestdevelop the WBS.
Different deliverables can have different level of detail:– excessive decomposition can lead to non productive management
effort and inefficient use of resources– not exhaustive level of detail reduces the possibility of best
managing and control.
For practical purposes 3 or 4 level of detail should be sufficient to reachthe desired planning and control approach.
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Work Decomposition
The number of levels can be influenced by:Level of detailLevel of riskLevel of controlEstimate accuracyWork package valueWork package dimension (cost, manhours, duration)
Except for E&C companies with more than 4 levels, sub-project are used, where the lowest level of WP of a projectconstitutes the highest level of another one.
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Work Decomposition
So how far should you break down the project deliverables?
You can follow the "8/80 Rule" the work package equates tono more than 80 hours of work and no fewer than 8 hours ofwork to create that deliverable. You don't want to get sogranular or so vague with your WBS that it's uncontrollableand useless.
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WBS example
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WBS example
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WBS development methods
― TOP-DOWN APPROACH
― BOTTOM-UP APPROACH
― WBS (ORGANIZATIONAL) STANDARDS
― WBS TEMPLATES
What development method to use?
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WBS development methods
― TOP-DOWN APPROACH
If the project manager and the project managementteam have little to no experience in developing WBSs
If the nature of the project’s products or services isnote well understood
If the nature of the project life cycle is not familiar orwell known
If no appropriate WBS templates are available.
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WBS development methods
― BOTTOM-UP APPROACH
If the nature of the project’s products and services iswell understood [For example, if the organization hasdeveloped very similar products or services on previousprojects]
If the nature of the project life-cycle is well known. [Ifthe organization use always the same project life-cycle]
Appropriate WBS templates are available. [If theorganization has WBSs from projects with similarproducts or services and these can be reused]
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WBS development methods
― WBS STANDARDS AND TEMPLATES
In general, if WBS standards or WBS templates areavailable, they can be used, but the choice to use asample WBS as template must be made carefully. Ifthere aren’t similarity between the new project andprojects already performed, the WBS must bedeveloped with the top-down approach.
Steps to create a deliverable-based WBS
1.Take the committed deliverables from your project charter,
statement of work, or other project conceptdocumentation. This list of deliverables becomes yourLevel 1 (highest level) entries within the WBS.
All WBS Entries that directly correspond to deliverablesshould be named as noun deliverables or adjective/noundeliverables. Examples include “Specification” or “DesignSpecification”.
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Steps to create a deliverable-based WBS
2.Take each of these highest level entries, and decomposethem into their component parts (each becoming a WBSEntry). Each component must be logically distinct, aseveryone who sees the WBS needs to understand what thedeliverable or outcome will be from each WBS Entry.
What logically distinct means is that the breakdown of a higher leveldeliverable to its lower level components must make sense. Each of thelower level components musts be distinguishable as unique, and they mustbe recognizable as part of the higher level deliverable.
Continue the decomposition until you reach an appropriatelevel of detail.
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Steps to create a deliverable-based WBS
The lowest level of decomposition is the Activity level. Activities should benamed as active verb / adjective / noun deliverables. Examples include“Create Design Specification” or “Update Design Specification”. By addingthe active verb, you better communicate to the assigned team member notonly what the outcome is (the deliverable) but you also communicate whatkind of process the assigned person is going to perform (create or update).
Note: You should never use terms like “perform”, as they do notcommunicate what is expected.
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Steps to create a deliverable-based WBS
3. When all committed deliverables have been decomposedto the appropriate level of detail (becoming Activities),examine each WBS Entry and Activity to see if there arerequired deliverables that are not already in the WBS butthat will be needed to create something that already is in theWBS.
As an example, you may have a deliverable defined for a softwarecomponent (system, subsystem, or function). However, to deliver this intothe production environment, you may also need preceding deliverables suchas test results, compiled code, design documentation, and requirementsdocumentation.
Take all these required deliverables, and decompose them tothe appropriate level of detail, just as you did for thecommitted deliverables.
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Steps to create a deliverable-based WBS
4. Level the hierarchy to the extent that it is possible. At thisstage of development, the WBS may have some Activities atlevel two, some at level three, and so on. See if thehierarchy can be modified so that the number of levels thatActivities fall into is reduced to a short range.
One way to do this is to examine the number of Activities falling within asingle WBS Entry. If the number is less than three to five, see if theseActivities can be merged with another WBS Entry’s Activities. If the numberis more than 10, see if the WBS Entry can be split into two logically distinctcomponents, each with its appropriate Activities. The general idea is toattempt to have each WBS Entry that decomposes into Activities haveapproximately 7 plus or minus 2 (5 to 9) Activities.
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Steps to create a deliverable-based WBS
You should never make these changes if the merger or split of a WBSEntry does not make logical sense.• When evaluating whether to merge two WBS Entries, the question to askis, “are these two deliverables really part of one deliverable, and is thatdeliverable distinct from all others?” If the answer is yes, then you shouldcombine them, otherwise don’t.• When evaluating whether to split a WBS Entry with too manycomponents, the question to ask is, “does this WBS Entry deliverable havetwo or more major components, and can the already defined lower leveldeliverables be combined into these proposed higher level ones?” If theanswer is yes, then you can split the WBS Entry. If the answer is no, thenleave it as is.
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Steps to create a deliverable-based WBS
5. When you think you have a completed WBS, validate it using a bottom-up approach. A bottom-up validation works like this:• For each WBS Entry that decomposes into Activities, ask yourself thequestion: “If I had all the deliverables from each of these Activities,would my WBS Entry deliverable be complete?” If the answer is yes, moveon to the next WBS Entry. If the answer is no, add in the missingActivities.• Once the evaluation of the lowest level WBS Entries and Activities iscomplete, examine the next higher level of WBS Entries. Keeping with ourthree-level example, for each Phase ask: “If I had the deliverables fromthe WBS Entries that are part of this Phase, would the Phase deliverablebe complete?” If the answer is yes, move on to the next one, if theanswer is no than add in the missing WBS Entries or go back to step 4 andrebalance the hierarchy, or both.
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Steps to create a deliverable-based WBS
Note: Validating the completeness of the WBS if extremely important, as amajor reason for projects being late and over budget is the originallyplanned scope of the project was incomplete, and there was a significantamount of unplanned work that had to be done. Since this unplanned workwas not part of the original plan, and it consumed resources that wereoriginally scheduled for other project work, the schedule inevitably slips.
6. When you have completed your bottom-up validation, it isnow appropriate to re-evaluate the entire WBS one last timeby comparing the currently defined WBS deliverables to theoriginally defined objectives for the project. Ask yourself thequestion, “If I had all these deliverables, would I achieve theplanned objectives for the project?” If the answer is yes, youcan move on to the next step. If the answer is no, you stillhave a lot of work to do.
Work Package (WP)
• It is the elementary unit of the project planning andcontrol
• It constitutes of more elementary activities interrelated,with objectives and constraints univocally defined
• It is defined in relation with Product Breakdown Structure(PBS), Activity Breakdown Structure (ABS), andOrganizational Breakdown Structure (OBS)
• For every WP, start/finish and available resource aredefined
• Time, cost and quality objectives are measurable tocontrol them
• A Description is associated to every WP (objectives,responsibility, authorized budget, start/finish,milestones, interactions, revisions of all these entries)
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Work Package (WP)
Crossing a WBS element and an OBS one, a WP it isobtained as elementary unit of project management
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WBS development rules
RULE 1 (100% RULE)
The sum of the work at the “child” level must equal 100% of thework represented by the “parent” and the WBS should not includeany work that falls outside the actual scope of the project, that is,it cannot include more than 100% of the work
RULE 2Every breakdown level must be developed adoptin a singlerationale
RULE 3Different level of the WBS can be developed according todifferente rationale
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WBS development rules
RULE 4
Every WBS level and every part of it must be coded to allow WPresearch/aggregation useful to planning and control
RULE 5To choose WP dimension it is necessary consider that at thediminishing of these dimensions, it increase:• managerial capacities of the single responsible• WP number with control complications
RULE 6WBS is the base to highlight interfaces among WPs, so thenecessity of interactions among the correspondent organizationalunits that are the responsible of them
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WBS development rules
RULE 7
WBS may be developed according to specific needs of the projectconsidered (WBS ad hoc) or according to a standardized referencescheme
RULE 8It is possible to aggregate elements of WBS according to differentways respect to those of the WBS hierarchical structure. Forexample: activities that determine jointly incomes and cash flow;materials that belongs to different part of the WBS but aretransported on the same date through the same transport means;project aspects that involve different sub-systems of the plant.
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Breakdown rationale for plant project
1. FUNCTIONAL RATIONALE (typical of base engineering or
commissioning phases)
2. SPATIAL/STRUCTURAL RATIONALE (typical of
construction/assembly phases)
3. SPECIALISTIC PROCESSES RATIONALE (every phase is identified
and then for every one the specific breakdown rationale is
adopted)
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WBS Quality Principles
• WBS Quality Sub-Principle 1 – Core CharacteristicsThere is a set of core characteristics that must be present in every WBS, asthese characteristics enable the WBS to satisfy project needs that arepresent in every project
• WBS Quality Sub-Principles 2 – Use-Related CharacteristicsThere is a set of additional use-related characteristics that may vary fromone WBS to another. These characteristics enable the WBS to be used forpurposes that are unique to a specific project, industry or environment, orare applied in a particular way to individual projects.
WBS Quality Principle 1A quality WBS is a WBS constructed in such a way that it satisfies all of therequirements for its use in a project
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WBS Quality Principles
Representative examples of WBS defects are:• There are frequently missed deadlines and an extended schedule• Project is over-budget• Individuals are unable to use the new product or feature• The project scope has changed and is unmanageable• The project has become an ongoing project with no end in sight• Project team members are confused about their individualresponsibilities• Some planned work does not get done.
WBS Quality Principle 2WBS quality characteristics apply at all levels of scope definition.
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Other Breakdown Structure
The WBS should not be confused with other kinds of"breakdown" structures used to present project information.Other structures commonly used in some application areas
include:
Contractual WBS (CWBS), which is used to define the level ofreporting that the seller will provide the buyer. The CWBSgenerally includes less detail than the WBS used by the sellerto manage the seller’s work.
Organizational breakdown structure (OBS), which is used toshow which work elements have been assigned to whichorganizational units.
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Other Breakdown Structure
Cost Breakdown Structure (CBS), which represents thefinancial breakdown of the project into budgets per workpackages.
Location Breakdown Structure (LBS), which is used to showthe location of the work and would be appropriate for aproject which as pockets of work dotted all over the place.
Transport Breakdown Structure (TBS), which is used inprojects characterised by large loads that may find transportand cranage limitations critical for the breakdown.
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Other Breakdown Structure
Resource breakdown structure (RBS), which is a variation ofthe OBS and is typically used when work elements areassigned to individuals.
Bill of materials (BOM), which presents a hierarchical view ofthe physical assemblies, subassemblies, and componentsneeded to fabricate a manufactured product. Also calledProduct Breakdown Structure.
Project breakdown structure (PBS), which is fundamentallythe same as a properly done WBS. The term PBS is widelyused in application areas where the term WBS is incorrectlyused to refer to a BOM.
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Other Breakdown Structure
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Other Breakdown Structure
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WBS example
WBS advantages
1. To identify the Project independently on who participatesit
2. To clearly identify project objectives3. To provide a scheme that guarantee objectives
achievement through inferior objective most controllable4. To obtain a “different levels” visibility5. To univocally identify reference sectors of the documents
relative to monitoring, controlling and reporting activitiesof the project
6. To highlight interactions rationale among projectelements
7. To identify WP to assign responsibilities and resources8. To identify innovative and repetitive components
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