Big Picture in Focus: Ulob Metalanguage: Develop Work Breakdown Structure

Develop Work Breakdown Structure
Big Picture in Focus: ULOb
Metalanguage
1. Work Breakdown Structure (WBS) – It is a comprehensive, systematic and
major tool in project planning that centers on the actual tasks of the project.
2. Project budget – It is a detailed, time-phased estimate of all resource costs for
a project
Essential Knowledge
Developing the Work Breakdown Structure
There is no magic formula in project completion. As a project manager, you

need to carry out step by step activity that will target the completion of the overall
deliverable.
The Work Breakdown Structure (WBS) is a comprehensive, systematic and major

tool in project planning that centers on the actual tasks of the project. The purpose
of WBS is to make certain that the entire work necessary to meet the project
objectives is acknowledged, described and delegated. It shows the subdivision of
tasks, subtasks, and work packages in terms of organizational elements associated
with the project. Every downward level signifies increasingly comprehensive
definitions of project work with the lowest level giving a picture of an individual
element of work that can be identified and responsibility assigned to a particular
person.
The Work Breakdown Structure ought to consist of:

1. Product/Service Delivery Tasks – The work necessary to productively
describe, build and execute a product or service is completely detailed in the Work
Breakdown Structure to guarantee that all project deliverables can be finished on
time and according to conditions.
2. Project Management Tasks – Tasks that address project management
activities like starting the project, generating and tracking the project plan,
supervising the project team and preserving expectations are all shown in the Work
Breakdown Structure to allocate sufficient time and resources.
3. Training Tasks – Training tasks are part of the Work Breakdown Structure so
that team members and users obtain the right training at the exact times with no
negative impact on the project schedule.
4. Project dependencies – The four types of project dependencies and their
deliverables are integrated in the Work Breakdown Structure to make sure that they
are followed.
More levels of detail are generally required for projects which are larger, more
risky, dissimilar to past projects and difficult to define or vulnerable to change.
Overall for a generic project, the levels of details for WBS follow this format:
Table . Work Breakdown Structure (WBS) Levels
There must be a complete breakdown of activities identified at both the

deliverable and work package levels. The WBS also provides numeric codes for each
activity. The assigned code for each activity aids in allocating costs more accurately,
track activities that are over or under budget and maintain financial control of the
development process.
Table . Example of WBS for an IT Project

The Tree Structure View is the most well-liked layout for the Work Breakdown
Structure. It is very simple to view and understand view. However, it is complicated
to construct in the absence of an application exclusively intended for creating this
organization chart structure. The Tree Structure design of WBS can be created using
only Microsoft Word and the SmartArt graphics option under the insert menu.
Prepare cost estimate and budget proposal
Big Picture in Focus: ULOc
Metalanguage
The following definition will help you easily understand ULOc:
1. Cost estimating. This refers to the process of calculating possible budget by
identify the resources need for the project and its respective cost.
2. Project budget. It is a detailed, time phased estimate of all resource costs for
a project.
3. Analogous estimating. This is an estimating technique that uses costs along
with measures of scale like size, weight or complexity from the previous project
to estimate cost for similar future project.
4. Parametric estimating. This is an estimating technique that uses a statistical
relationship between historical data and other variables to calculate an estimate
for activity factors like scope, cost, budget, and duration costs for project
completion.
5. Bottom-up estimating. It is the method of constructing estimates by
decomposing the work into more detail.
6. Top down estimating. It is based on the collective judgements and
experiences of top and middle management and available past data concerning
similar activities.
Essential Knowledge
A well-researched and planned cost estimation and budget is necessary for the
successful completion of any project. Project managers need to thoroughly scope the
project in order to secure sufficient funding. Scoping involves estimating labor hours,
materials, supplies and other miscellaneous expenses. Budgets and cost estimations
are a work in progress and should contain room for change.
Cost Estimation and Budget in Project Management

Project budgeting and cost estimation goes hand in hand. A project budget is a
detailed, time-phased estimate of all resource costs for a project. Typically a budget
is developed in stages which are from a preliminary rough estimate to a detailed
estimate to a completed, approved project budget. On occasion, approved budget
may.
Cost estimating is the process of approximating a reasonable time phased
budget by identifying the cost of resources required in order to complete project
activities. A good cost estimate is impartial. It should be made by someone who
would always be sensible in numbers, meaning no overestimate or underestimate.
The cost estimate out to clearly describe the purpose of the project, what it will carry
out, what assumptions are prepared, how long the estimate is legally binding, and
how much the project will spend. The estimate should be flexible, adaptable and
provide a range of the costs involved. Cost estimates start out broad, and as various
stages are completed, they are more accurately defined.
Estimating a project’s costs is important for several reasons:

1. It makes possible the project manager to consider probable benefits against
estimated costs to see whether the project is logical.
2. It permits the project manager to distinguish whether the necessary funds are
obtainable to sustain the project.
3. It provides as a guideline to help ensure that there is adequate funds to finish
the project.
Methods of Estimating Cost

The following are methods of estimating cost:
1. Analogous estimating – This is an estimating technique that uses costs along
with measures of scale like size, weight or complexity from the previous project
to estimate cost for similar future project.
2. Parametric estimating – This is an estimating technique that uses a statistical
relationship between historical data and other variables.
3. Bottom-up estimating – It is the method of constructing estimates by
decomposing the work into more detail. An estimate is planned based on the
requirements of each of the lower, more detailed pieces of work and then later
are combined into a total quantity for the project. For this method work
breakdown structure (WBS) necessitates to be broken down to the most detailed
level with clear specifications.
4. Top down estimating – It is based on the collective judgments and
experiences of top and middle management and available past data concerning
similar activities.
Project Cost Estimating Issues

The following are some issues that may arise in estimating project cost:
1. Short initial estimates
2. Unpredicted technical difficulties
3. Lack of definition
4. Specification changes
Creating a Project Budget

The forecast on what resources the project will, the required quantity of each,
when they will be needed and how they will cost are necessary to develop a project
budget. In addition, the effects of potential price inflation should not be taken for
granted. Uncertainty is always an element of forecast, some maybe less but others
could be more.
There are two ways of data gathering to obtain input data for the budget which
are topdown budgeting and bottom-up budgeting.
1. Top-down budgeting – This is a strategy of seeking first the opinion and
experiences of top management regarding estimated project costs. The
assumption is that senior management is more experienced with past projects
and is in position to offer precise feedback and estimates for future project
ventures. They initiate the estimation of the overall costs of a project and its
major work packages. Their projections are given to the functional department
levels where supplementary, more definite information is gathered. The project
is broken down into detailed pieces at the functional departments. Later the
project personnel who is assigned the task eventually supply input on specific
costs on a task-by-task basis.
Table 1.Advantages and Disadvantages of Top-Down Budgeting
2. Bottom-up budgeting – this strategy starts inductively from the work

breakdown structure (WBS) to apply direct and indirect costs. Each project
manager is required to prepare a project budget that names project activities
and indicates funds requested to support these tasks. The functional managers
develop their own documented budget with requirements of the firm’s projects
and their own departmental needs in mind.
Ways to Improve the Process of Cost Estimation and Budgeting

Estimating is defined as an informed assessment of an uncertain event. For
project managers, accurate estimates are the foundation for effective planning and
execution. There are many processes that have been developed to assist in the
estimation process. Without proper estimating a project duration, cost, resources,
risk and other parameters, it is impossible to implement proper alternatives and
ultimately make timely and sound decisions.
There are two fundamentally different ways to manage the risk associated with
the chance events that take place on every project:
1. Most familiar is to create an allowance for contingencies which are usually 5% to
10%.
2. Another is when the forecaster chooses “most likely, optimistic, and pessimistic
estimates.
With so many factors that could possible cause estimate and accuracy, what can
be done to make magic estimates the most accurate?
1. Teach the project team and organization on estimating and entail the fitting
project team members set up the approximate associated with their scope
aspect of the project.
2. Contact for an expert with experience for scenarios.
3. Include peer reviews and estimate validation processes into the product life
cycle.
4. Integrator risk management contingency assessment throughout the PLC.
5. Promote estimate review and validation after each phase of the PLC.
6. Precise and well-timed documentation of change request.
7. Do research regarding historical data on the project effort, schedule, cost, risk
and resources for lessons learned and make suitable adjustments. Statistical
baseline should be and modify occasionally.
8. Use mock ups, trial run, field studies or other simulations as a direct.
9. Sufficiently identify work scope and truthfully track time against each task.

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Develop Work Breakdown Structure

Big Picture in Focus: ULOb

There is no magic formula in project completion. As a project manager, you

The Work Breakdown Structure (WBS) is a comprehensive, systematic and major

The Work Breakdown Structure ought to consist of:

There must be a complete breakdown of activities identified at both the

Table . Example of WBS for an IT Project

Cost Estimation and Budget in Project Management

Estimating a project’s costs is important for several reasons:

Methods of Estimating Cost

Project Cost Estimating Issues

Creating a Project Budget

Table 1.Advantages and Disadvantages of Top-Down Budgeting

2. Bottom-up budgeting – this strategy starts inductively from the work

Ways to Improve the Process of Cost Estimation and Budgeting

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