Answer

New Project Planning Approach at the Bright Company

1.0 PART A

1.1         Introduction

Project management refers to the process of planning, organizing, along with managing the determination and effort to realize a successful project (Tesfaye et al., 2017). Specifically, project management entails defining as well as confirming a project’s objectives and goals, how they will be realized, identifying tasks along with quantifying the needed resources, and gauging timelines and budgets for completion (Pinto & Morris, 2007). It equally entails managing the implementation of a project’s plan and operating regular checks to ensure objective and accurate information of the project’s performance relative to the project’s plan, along with mechanisms needed to implement recovery actions where there necessary. Thus, there is a need for advance planning and proper organization for a project to run effectively and efficiently. This paper critically analyses how a new project planning technique can lead to enhanced cost planning and improved project performance using Bright Company as the case study.

The Bright Company is number one firm delivering consultancy and projects within the construction field of large infrastructure and buildings. Both private and public sectors for the Bright Company’s customers. Having more than 250,000 employees, the company is situated at the capital and has a good past record of successful projects for international customers.

As the Bright Company’s new Chief Project Planning Manager (Senior Project Officer), I have the responsibility for all the company’s project planning techniques. As such, I have the responsibility of finding out how a new project planning strategy can lead to enhanced cost plan as well as improved project performance. To do this, I will be formulating a report that will critically evaluate crucial cost control techniques, assessing cost plans, as well as developing a Gantt chart for the Bright Company’s project. Moreover, I will develop a budget that will be aimed at helping the project run efficiently and effectively, on time as well as on budget.

Essentially, the principal objective of writing this report is to persuade the Bright Company’s board of directors that there are new techniques of project planning that can be employed to result in better cost plans and enhanced project performance. According to Abraham (2014), there are a number of strategies and methods that can be employed to eliminate or reduce time wastage during projects and this will assist in achieving sustainable business development and growth.

1.2         Costs Associated With the Project Planning Process

There are a number of costs associated with project planning. First are the direct costs. Fixed costs (since previous sentences introduces direct costs, it is odd that here fixed costs is explained rather than direct costs. Fix this please. And if direct costs are also fixed costs, inform instead of assuming the reader knows the two to be referring to the same thing) are those costs that can directly be attribute to the work upon a project (Tesfaye et al., 2017). These include costs of hardware and software that are employed during a project, salaries paid to and for the various resources used during a project, and billing rates of different resources, to mention but a few. Second are the indirect costs. These are costs that are spread out on and against a project and cannot directly be associated with a project’s activities and processes (Springer, 2016). These costs include those that are incurred in common services like taxes paid by an organization, office space, along with other services such as janitorial and secretarial staff.

Third are the variable costs. These are costs that change in proportion to the quantity, size, and amount of material and time that are spent upon produced during a project (Abraham, 2014). There are also fixed costs, which refer to costs that do not vary with a project’s progress or timeline (Tesfaye et al., 2017). Additionally, there are overhead costs. Overhead costs are those that are incurred in shared services and can directly be billed.   Moreover, there are also time phased costs or budget.  A time phased cost entails costs that are incurred at every milestone or interval of a project (Pinto & Morris, 2007). The milestones for a project would entail design, coding, requirements, testing, indirect and direct costs, variable and fixed costs. Lastly are the cumulative costs. A project’s cumulative costs are those that are incurred to a particular stage or milestone of the project.

1.3         Approaches to Costing In a Project

The significance of cost planning and cost control in project management success is one thing that all project managers are familiar with. Even though resource and time management are crucial to realizing projects’ goals, cost performance is eventually what determines the projects’ outcomes. Cost control in project management refers to controlling and planning a project’s budget (Boateng et al., 2017). It assists in predicting a project’s expenditure to avoid running over the budget. There are several project control measures that can be employed to minimize overspending as well as to ensure that projects stay within their time schedules. Among the widely employed project control measures are the Input, Process, Output (IPO) model, the Work Breakdown Structure (WBS), and the Four Ds of the project life cycle (PLC). All these project control techniques help and allow us to control cost, quality, and time in a project. For this report, the WBS, IPO, and 4Ds will be discussed.

1.3.1        The 4Ds of the PLC

The 4Ds of the PLC are define, design, develop, and deploy. This technique largely helps in the management of time during a project. The first D, connoting define, regards all the stakeholders that a project has, the strategies that are being employed, as well as how much a project’s strategies will contribute toward the success of the project. This is the foundation stage of a project; if done amiss, a project will ultimately fail. Thus, this phase forms a crucial part of a project since it implies that a project cannot proceed before strategic choices are managed and time and budget well planned (Phillips, 2012). The second phase, the design stage, is where cost planning and risk management are introduced. Having acquired all the requirements gathered in the previous stage, a project team begins to establish non-functioning prototypes, budgets, project plans, and estimated timeframes (Boateng et al., 2017). Essentially, this stage entails creation of the plans and documents that are needed to actually construct a project’s end. A crucial advantage of this stage is that it allows a project management team to rethink their strategy and to make their stakeholders informed of possible or potential dangers that could occur with the intention of eliminating them (Pinto & Morris, 2007). This way, this phase gives a project extra opportunities of running on budget and to schedule as well.

Next is the do stage. At this stage, decision making and problem solving along with concentration on leadership are given top priority. When what is required, intended, and aimed at and how to realize them is already set, a project management team at this stage should begin to execute the process of realizing a project’s goals. The advantage of this stage is that it focuses on team work as well as how the associations between stakeholders involved during a project, thus, substantially contributing to a project’s success (Springer, 2016). The last stage in this technique is develop stage, wherein concentration is put upon finishing of a project’s goals. A key component of this stage is delivery of results and making processes or products permanent. Abraham (2014) reasons that having an efficient and effective delivery structure that has techniques for controlling and stopping backsliding that often determine the success or failure of a project. This stage has the advantage of allowing stakeholders to assess the eventual completion as well as see whether all have been accomplished to the possible highest level (Rojas, 2009).

1.3.2        WBS

A WBS is a deliverable-focused itemisation of a project into smaller parts (Hoffmann, 2013). The WBS has several benefits along with organizing and defining a project work. Phillips (2012) notes that a project budget, using WBS, can be allotted to top levels of the WBS, and department budgets can quickly be computed depending upon each project’s task structure. Through cost estimations and allocation of time to particular tasks in a project’s WBS, a project budget and schedule can be developed faster (Rojas, 2009). During the running of a project, particular tasks of the WBS can be traced to recognize a project’s cost performance and identify problems and issues during a project (Boateng et al., 2017). Lock (2012) adds that project WBS can equally be employed in the identification of potential risks in given projects. These risks ought to be tracked in a project and be reviewed as a project gets executed. By integrating an organizational breakdown arrangement with WBS, a project manager can equally identify communication points along with formulation of a communication plan across an organization’s project (Hoffmann, 2013). When a project is lagging behind, referring to a WBS will quickly recognize the principal deliverables that are impacted by a lagging working bundle or late sub-deliverable statue (Phillips, 2012).

One principal strength of employing WBS is that it functions to facilitate monetary control besides helping to divide roles and responsibilities for all participants involved in a project execution (Shim, 2012; Abyad, 2018). This, therefore, breaks down large undertakings and makes a project extra likely to run as per planned in terms of time since only a section of a project can be worked upon at any given time. For purposes of realizing this project’s goal, the WBS will have to be very particular since there are several steps that will be involved, making each of the project’s activity extra comprehensive. This, as Rojas (2009) notes, is another strength of this cost control technique since it changes according to the type of project being run.

1.3.3        The IPO model

The IPO model is a widely employed technique for describing the structure of a data processing structure or other processes. Lock (2012) defines an IPO model as a functional graph that functions to identify the inputs, outputs, and needed processing tasks for purposes of transforming the inputs to outputs. The inputs connote the flow of materials and data into a process from external sources, the processing stage entails all tasks that are needed to impact a transformation of the received inputs, and the outputs refer to information/data as well as materials that are flowing out of the change process (Kostalova et al., 2018). Processes mediate mechanisms that transform inputs into outputs. One principal strength of this technique is that it allows for detection of overspending that may happen during a project. Also, Hoffmann (2013) asserts that since the model is divided into three distinct sections, management of a project is easier and one can easily identify risks and problems and spot where extra control over quality, cost, or time or all may be needed.  

1.4         Relationship between Project Planning, Budget Controlling, and Time Schedules

Project planning, controlling of budgets, and time schedules in project management are related in a number of ways. Project planning refers to developing the foundation of managing a project, which involves planning objectives, provisional works products, deliverables, procedures, chain of activities, organization, timing, types of resources and numbers, routines, and finances (Abyad, 2018). Project planning, therefore, involves identification of all tasks that are carried out given the scope of a project and the technical as well as business constraints. It also entails approximating the effort as well as cost of finishing each project’s task and project scheduling. Lock (2012) adds that project scheduling is among the crucial management duties in project management since it functions to dictate the time frames within which a project should be completed, costs/budgets in terms of resource/material requirements, along with the sequence of tasks to be completed. Essentially, project scheduling entails determination of when project activities will occur depending on predefined durations as well as precedent undertakings (Shim, 2012). Schedule constraints stipulate when a project’s activity ought to begin and end, depending on duration, external predecessor associations, and predecessors, target dates, resource availability, or other time limits (Kostalova et al., 2018).

Further, project scheduling entails assigning resources to a project’s tasks, balancing finishing dates against the availability of the suitable resources to finish tasks within the time available, identifying dependencies existing between tasks with the intention of scheduling them in the right and correct sequence, and identifying feasible start and finish points to accommodate the number of men required to work on a given task each day. This way, project scheduling functions to minimize overspending during the execution of a project by ensuring that the project consumes the inputs that were predefined to give the desired outputs. Also, project schedule entails planned date for beginning ad finishing activities, milestones, deliverables, and Gantt, thus ensuring that unnecessary spending and dates are used during a project (Abyad, 2018).

The relationship between project scheduling, controlling of budgets, and time schedules in project management can be well understood by a consideration of the triple constraint: cost, scope, and time. Cost refers to the financial restrictions of a project, equally referred to as project budget, scope refers to tasks that are needed to fulfil the goals and objectives of a project, while time connotes the schedule for a given project to finish. According to the triple constraint, the success of a project is influenced/affected by the project’s deadlines, budget, and features (Heagney, 2016). Cost, which is the financial dedication of a project depends upon several variables: those that are involved like materials and people, and fixed and variable costs that are inherent in any given project. Cost processes like cost estimation help in figuring out the required financial commitment for all resources that are needed to accomplish a task (Kostalova et al., 2018). Also, cost budgeting helps in the creation of a project’s cost baseline (Shim, 2012), while cost control functions to manage the fluctuation of costs all through a project execution (Dobson, 2015). 

As aforementioned, scope deals with the particular tasks/requirements that are necessary to accomplish a project.  When managing project’s scope it is essential to prioritize tasks, thus enabling a project management team in effectively planning and assigning resources (Phillips, 2012). Another important aspect of instituting and managing a project’s scope is handling stakeholders’ expectations. Scope management is essential since the amount of time taken by each project task is critical to the quality of a project’s final output. Last is time. At its elementary level, the schedule is the approximated amount of time allocated to complete a project, or to produce the desired deliverable. The three components of time management during a project are critical path, time schedule, and tasks. 

1.5         Risk Management Approaches in Project Planning

For improved project performance, there are a number of risk management techniques that can be employed. First is conducting assessments and meetings. Ongoing risk status and assessments ought to be scheduled for re-evaluation of present risks as well as the closing risks. It ought always to be an agenda at a project’s status meetings besides being a continual subject matter of conversation during a project planning (Heagney, 2016). Second is risk audits. Documenting and examining how efficient and effective present risk responses are components of a project’s planning auditing process (Springer, 2016). It equally looks at the effectiveness and efficiency of a project’s risk management process holistically (Dobson, 2015). Third is examination of variance and trend assessment. This technique requires comparison of planned outcomes to actual outcomes using a project’s performance information and data to monitor and regulate risk events (Heagney, 2016). The last technique is technical performance quantification. This technique involves comparing technical accomplishments as a project is executed to what is upon the principal schedule (Dobson, 2015).

2.0 PART B

2.1     Gantt chart Report

Below is the image of the Gantt chart that was generated using the Microsoft Project for the Bright Company. The implementation of this new Project Planning technique is time critical, running for a four-month (80 working days) period before it will be presented before the Bright Company’s board of directors. The project is to be started on 4^th February 2019 and must be completed by 21^st April 2019. All the quoted days in this chart connote actual working days. Weekends are not included in the quoted days and a week equals to 5 days.

The WBS for this project is as summarised here below. (Note the distribution of days for the activities under Proposal of Project Planning Changes).

The total amount of money allocated for this project is £850,000 as was considered sufficient and appropriate by the Bright Company’s CFO. This sum of money should cover all costs that are required to complete the project, including the personnel who are allocated to me for this project (two consultants and two secretaries), all costs of travelling, all new software and hardware for the project planning solution.

2.2     Gantt chart Image

2.0     3.0 PART C

3.1     Budget Creation

3.1.1    Overview of the Budget

The images below show a summary of the calculations that were done to project an amount that is likely to be used during the project. There are breakdowns about the resources that will be used during the project. In addition to the salaries of the personnel who will be involved, there are cost details regarding accommodation, travel costs, celebratory meal, and meetings. The travel cost per day is set at £50. This will allow for participants to move about by train during peak hours of the day. Rates of meetings are set at £400 per day. This will allow for booking venues for the meetings and purchase of refreshments and meals to keep the involved persons’ concentrated.

From the budget summary image, the amount of money that we are likely to spend during the project is £419675. The amount available for this project, as what was given by the Bright Company’s CFO is £850,000. Clearly, the difference between the projected cost and the budget amount is £430325. This difference will leave me with a large contingency fund that will be able to cater for any unforeseen costs that may surface as the project will be running. I have opted to keep this large contingency fund because we have plans of having meetings that will be aimed at avoiding risks. The amount would also allow us to acquire any equipment or service or consultant as the project will be rolling out  without necessarily lose time; this will allow us to change the project’s baseline resources or inflation, thus keeping us on budget, cost, quality, and on track (Boateng et al., 2017). 

3.1.2    Salaries

3.1.3    Accommodation

3.2     Summary of the Projected Budget