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1.040/1.401 Project Management Spring 2007 Lecture 7

1.040/1.401 Project Management Spring 2007 Lecture 7. Planning Basics. Dr. SangHyun Lee. lsh@mit.edu. Department of Civil and Environmental Engineering Massachusetts Institute of Technology. Project Management Phase. DESIGN PLANNING. DEVELOPMENT. OPERATIONS. CLOSEOUT. FEASIBILITY.

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1.040/1.401 Project Management Spring 2007 Lecture 7

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  1. 1.040/1.401Project ManagementSpring 2007Lecture 7 Planning Basics Dr. SangHyun Lee lsh@mit.edu Department of Civil and Environmental Engineering Massachusetts Institute of Technology

  2. Project Management Phase DESIGN PLANNING DEVELOPMENT OPERATIONS CLOSEOUT FEASIBILITY Fin.&Eval. Organization Risk Estimating Planning

  3. Outline • Planning – Hierarchical Project Structures • Work Breakdown Structure • Organization Breakdown Structure • Cost Breakdown Structure

  4. Planning Components • What: Work Breakdown Structure • How: Plans and Specifications • Who: Organization Breakdown Structure • How much: Cost Breakdown Structure (via estimate) • When: Schedule

  5. Outline • Planning – Hierarchical Project Structures • Work Breakdown Structure • Organization Breakdown Structure • Cost Breakdown Structure

  6. Work Breakdown Structure • A WBS is a deliverable-oriented grouping of project components that organizes and defines the total scope of the project • Work not in the WBS is outside the scope of the project • WBS is usually an operative tool used by contractors • First step towards constructing a schedule • Central role in project monitoring and control

  7. WBS: Example different summary level Source: Shtub et al., 1994

  8. Work Package • Lowest level • Distinguish from Others • Single Responsible Organization • Assigned Start and Finish • Assigned Budget • Limited Duration

  9. Types of WBS • Project WBS • Operative tool for monitoring and control contractor work • Contractual WBS • Defines the level of reporting that the seller will provide the buyer • May include less detail than Project WBS • Agreed between owner and contractor

  10. Functional Approach GAS-STEAM COMBINED POWER PLANT level 0 level 1 level 2 level 3 level 4 level 5 MAIN FUNCTIONS OF PLANT STEAM INTERFACES GAS ITEMS COMPRESSION STATION TURBINE GENERATOR UNITS COMPRESSORS GAS TREATMENT ENCLOSURE SUB-UNITS WORK PACKAGES FOUNDATIONS COMPRESSOR 1 COMPRESSOR 2 INSTALLATION DESIGN PROCUREMENT

  11. Physical Space Approach • Project • Main building • 1st floor • Structures • Plumbings • Electrical • HVAC • 2nd floor • Service building • Structures • Plumbings • Electrical • HVAC

  12. Procedure Approach • Project • Feasibility • Design • Basic • Detail • Bid documents • Shop drawings • Bid • Construction • Foundations subcontract • Main building • Piles • Concrete foundations • Service building • Piles • Concrete foundations • Steel erection • Finishings • Commissioning

  13. WBS: CSI Master Format - Example Sample Source: Schaufelberger et al., 2002

  14. Outline • Planning – Hierarchical Project Structures • Work Breakdown Structure • Organization Breakdown Structure • Cost Breakdown Structure

  15. Organization Breakdown Structure • Decomposition of necessary resources to perform job • Identification & organization of the resources responsible with carrying out activities associated with the project • Used to keep track of specific work assignments & resource allocations

  16. Organization Breakdown Structure • Project resources • Project management team • Project manager • Construction superintendent • Field superintendent • Office manager • Scheduler • Accounter/controller • Field engineer • Construction force • Worker • Subcontractor • Electrical • Plumbing • Insulation • Tankage • Roads

  17. OBS/WBS Linkages Source: Shtub et al., 1994

  18. Outline • Planning – Hierarchical Project Structures • Work Breakdown Structure • Organization Breakdown Structure • Cost Breakdown Structure

  19. Cost Breakdown Structure (CBS) • Breakdown of the costs of the various components of the structure including all work done by the subcontractors • Serves as a basis for subsequent monthly pay requests by the contractor • Used to continuously compare costs as they actually occur with the budget

  20. Cost Breakdown Structure (CBS) Source: Shtub et al., 1994

  21. Two Main Approaches • CBS = WBS • CBS is the project cost control structure • CBS ≠ WBS • CBS is the corporate multi-project cost control structure • Usually the case of a firm that has an integrated cost control system

  22. Diverse Combinations • WBS + OBS: Task assignments • CBS + OBS: Budget monitoring of crews, etc. • OBS + Schedule: Time-specific crew assignments • CBS + Schedule: Cost monitoring

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