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Module 4 Project Mgmt, Part B Roles in Project Mgmt, Part C: Project…

- - - - Role of MA
        
        budget (grand chart, Pert Diagram)
        
        other financial planning , design KPIs
      - Stage 3: Project Implementation, Control & Monitoring - Occur when project activities begin, set deliverables dates/milestones, budget is monitored, variances are examined and necessary adjustment are made
        
        Role of MA
        
        ongoing budget variance analysis,
        
        tracking performance against KPI
        
        Stage 4: Project Completion & Review - Final stage, completed and original objectives achieved. Project wrapped up, team redeployed, review lesson learned
        
        Role of MA
        
        determining final project costs
        
        closing down related accounts
- - - - Attribute
        
        geographical spread (multiple locatins),
        
        Purpose - complex
        
        Larger project scope
        
        Higher risk - higher uncertainty
        
        Project Cost - large and geographically diverse (forex)
      - Factor Causing Complexity
        
        Lack of Control
        
        Different Culture, time zones
        
        Diff currencies
        
        Diff legal structures, political undertainty
        
        Project visibility
        
        Cultural Fluency (pg153)(SC52)
        Good Project Manager need to understand all below Fluency
        
        (1) Strategic cultural fluency - cultural behaviour at senior level and how this form context for project
        
        (2) Workgroup cultural fluency - diff culture, own issues and process
        
        (3) Personal Cultural fluency - own social etiquette, language, skills, knowledge
- - - - Skill required (Table 4.1) (Pg155)
        (1) Technical - (i) Process (critical path analysis, risk analysis, capital budgeting) , (ii) Project specific(IT skills), (iii) general knowledge
        (2) Softskill - Communication, problem solving, Insight, Negotiation, Conflict resolution, Leadership
- - - - to ensure sufficient ethical framework established and long term effect mkg
        To use AAA Model (Drellinger Turner 2003) on 5 question to evaluate whether decision is ethical or not
- - - - 2x2 Matrix approach (Pg170)(SC58)
        
        (1) High Financial impact, High Probability --> Consider first (Most Risky/dangerous to pay attention)
        
        (2) High Financial impact, Low probability --> Consider second
        
        (3) High Probability, Low Financial impact --> Consider 3rd
        
        (4) Low probability, Low Financial impact --> Consider last
        
        MA Roles
        
        make sure the risk is accounted for just "ONCE"
        
        to use Rate of Return (RRR) cost estimate
        
        MA to assist manager designing systematic appraoches to managing project risk, identifying cost reserves for risk in project budget
      - (c) Risk Mitigation
        
        action to reduce overall probability impact of risk after Risk classification, required additional cost
        
        Key tools for risk mitigation is Risk Register (refer table 4.7)(pg172)
        
        MA Roles
        PM preparing risk mitigation plan by consultation with MA
- - - - Pert and CPM
        
        Step 1: Draw network diagram
        
        Step 2: Calculate expected time
        
        Step 3: Define the critical path
        
        Step 4: Calculate slack
        
        Step 1: Activity on arrow network or Activity on-node
        
        Step 2: Calculate expected time (pg188)
        ET = (O + 4ML + P ) / 6
        O = Optimistic
        P = Pessimistic
        ML = Most likely
        Variance = (P-O)2 / 6
        
        Step 3: Define Critical path
        EOT = time an activity is expected to be completed - to find out which one takes longest time to complete
        
        Step 4: Calculate Slack
        Formula = LST - EST
      - Crashing a project (pg190)
        
        Crashing project duration - need to be Critical path (longest path)
        
        Crashing cost - lowest cost need to crashed first
        **Cost time slope = (Crash cost - normal cost) /
        (Normal time - Crash time)**
        Refer own note
- - - - Cost or Spending Variance
        EV - AC
        negative = overspending or overbudget
        Positive = Underbudget
      - Schedule Variance
        EV - PV or Budgeted Cost
        Negative = behind schedule
        Positive = ahead schedule
      - Cost Performance Index = EV / AC
      - Schedule performance Index (SPI) = EV / PV
      - Time Variance = Schedule time - Actual Time
      - Resource flow variance = Bud Exp - Act Exp
  - - - (3) Quality Cost (pg199)
        
        (1) Prevention
        
        (2) Appraisal
        
        (3) Internal failure
        
        (4) External failure
- - - - Scope creep (pg203) change in project scope that unplanned
- - - - MA - require increase in working capital to get funding of the project cost
        
        Forecasting Cash flows
        (prediction of future cashflow)
        
        MA can analyse mkt growth, development in mkt share, actions of competitors, tends in price
        
        Estimate life of project
        
        Residual value
        
        Discount Rate (Pg175)
        
        Cost of Capital (bnk)
        
        Opportunity cost
        
        WACC (higher discount rate can reduce PV of CF)
  - - - Payback = Initial investment /
        Annual net cash inflow (exclude residual amt)
      - (5) Return on Investment (ROI)(Pg179)
        (not account for time value of money)
        
        ROI = Profit or annual cash flows## /
        Original investment or Return or invested capital
        exclude residual value##
        
        Average Investment and residual loss
        average investment = (initial investment + residual loss )/2
        
        (6) Residual Income (Pg180)
        how much value a project is expected to create
        
        RI = Profit - Capital Charge
        Capital Charge = WACC % (initial investment)
- - - - (4) Strategic Fit assessment (pg204)
        MA to ensure constant interaction between org strategy & project delivery alignment is maintained
        avoid scope Creep
        
        Question to ask:
        
        (1) underlying problem/opportunity was dealing with and deliver?
        
        (2) project deliver against strategy was intended to support?
        
        (3) Project deliver against its objective and associated performance measures and targets?
        
        Challenges:
        
        (1) strategies of org may change during life of project
        
        (2) project outcomes not always clear and quantifiable
        
        (3) qualitative benefits from project not be obvious (ie ABC system hard to measure qualitative benefit)
        
        (5) Stakeholder Satisfaction Assessment (pg205)
        establish whether each stakeholder requirements have been met
        this is ongoing process
        
        (6) Financial Closure (pg205)
        
        (1) Final Costs
        
        Calculate final cost vs final bud variance analysis.
        
        analysis variance size and cause - knowledge gained for future project
        
        via improving estimation processes - organization learning key aspect of project completion & review
        
        (2) Closing cost records
        
        closing off project accounts (ie WIP)
        
        if not closed, project worker may still bill hours and other non-genuine expenditure
        
        is frequent/significant problem
        
        (3) Post-Project Expenditure (pg205)
        
        1 more item...
        
        (7) Resource dispersion
        
        MA disposal of excess supplies & Capital equipment
        
        (8) Final Report (pg206)
        
        (9) Knowledge Management(pg206)
        
        1 more item...
        
        report end of project. important to clarify key issue of controllability in budget variance