BATANGAS STATE UNIVERSITY

College of Engineering, Architecture and Fine Arts

Gov. Pablo Borbon Campus II,
Alangilan, Batangas City, Philippines 4200
www.batstate-u.edu.ph Telefax: (043) 300-4044 locs. 106-108

CHEMICAL AND FOOD ENGINEERING

DEARTMENT

IE 530
Engineering Management

PROJECT PLANNING
PROJECT MANAGEMENT
TOTAL QUALITY MANAGEMENT
RISK MANAGEMENT

Nisortado, Harold
Panaligan, Kerby
Panganiban, Glycel
Pasia, Kristhel Joy
Pateña, Jean Ellize
Rosales, Karisa
Sabido, Mikee
Solis, Kimberly
Talaoc, Limmuel
Villano, Dhankay
Villanueva, Kim Gerard

ChE - 4301

Dr. Eufronia M. Magundayao

Instructor

June 22, 201

 THE BASICS OF PROJECT PLANNING

What is Project Planning?

Project planning:
 Involves a series of steps that determine how to achieve a particular community or
organizational goal or set of related goals.
 Identifies specific community problems that stand in the way of meeting community goals.
 Creates a work plan for addressing problems and attaining the goals.
 Describes measurable beneficial impacts to the community that result from the project’s
implementation.
 Determines the level of resources or funding necessary to implement the project.

Why is project planning important?

Project Planning helps us to: Project Planning helps to eliminate:
think ahead and prepare for the future clarify poor planning overambitious projects
goals and develop a vision identify issues that unsustainable projects undefined problems
will need to be addressed choose between unstructured project work plans
options consider whether a project is possible
make the best use of resources motivate staff
and the community assign resources and
responsibilities achieve the best results
Once project charter is approved, the project is formally initiated. Project planning activity can
begin based on the project charter document, project requirement document.

Elements of project plan

1. Project Scope Planning
Essentially, project scope is the definition of what the project is expected to achieve and
specify the budget of both time and cost that needs to be provisioned to create the project
deliverables before the project gets closed.

Project Deliverables
To define project scope, one needs to refer project requirements. The project planner needs
to list down project deliverable items unambiguously stating whether they are ‘In Scope’
or ‘Not in Scope’. So, project scope is about outlining the project deliverables. Based on
project scope, project planner(s) create(s) work break down structure (WBS).

1.1. Work Breakdown Structure (WBS)

The WBS is a breakdown/ decomposition of project work into distinct work items in
a hierarchical fashion wherein with each descending level, it gives details of project
deliverable required from project team.

Triangular Constraints (TQR)

The project scope is generally constrained, with respect to following aspects
1. Time
2. Quality
3. Resources
2. Delivery Schedule Planning
Once project scope is determined and work breakdown structure (WBS) is created, the next
step is to create delivery timeline. For each of the deliverable work item identified in the
work breakdown structure (WBS), project planner needs to identify list of activities need
to perform.
Activities/Tasks
 How long will it take to complete each activity (days, weeks)?
 What kind of resource(s) – required for its completion (skill set, experience, etc.)?

Milestones
A milestone marks a significant event in the project. Generally, project sponsors would
refer to list of milestones to trace project delivery in respect of timeline & cost overrun.

Gantt chart
Generally, this is where project sponsors start pushing for aggressive project deadline
which might have been indicated/ agreed earlier and sometimes it becomes a real problem.

3. Project Resources Planning

Project resource is not just about the people to be involved in the project, rather materials,
equipment required for successful completion of the project. Generally resource planning
tends to revolve about people/staffing management.

Human Resource Plan

This plan tries to answer following questions but rather precise details:
1. What kinds of people are required to complete the project – necessary qty, competencies?
2. What should they do – roles & responsibilities?
3. Whom will they report to?

Thus, human resource plan identifies and document the staffing requirements – skillset,
roles, responsibilities and also establish the reporting structure of the project resources. It
also provides the staffing plan which specifies timeline of acquisition & release of staff.

To arrive at human resource plan, project planner need to refer organization structure &
figure out necessary changes and compliances required for project requirement. Companies
may have following organization structure:
1. Hierarchical Organization
2. Matrix Based Organization
3. Flat organization

4. Project Cost Planning

Cost planning exercise helps to baseline the overall project budget in terms of money so
that project sponsors & project steering committee can agree on project delivery schedule
as well as the payment schedule. It tries to identify cost elements to be consumed during
the project lifecycles such as

 Monetary resources requirement (people, machinery, material, equipment, space, etc.)

 Provisions for risk management (people, machinery, material, equipment, space, etc.)
5. Project Quality Planning
There are various known approaches to ensure project quality – some of these are
1. Six Sigma (6 σ)
2. Cost of Quality (CoQ)
3. Total Quality Management (TQM)
4. Failure Mode and Effect Analysis (FMEA)
5. International Organization for Standardization 9001, etc.

6. Supporting Plans
1. Risk Management Plan
2. Communication Plan
3. Procurement Plan

Conclusion
One of the critical factors to succeed in project management is to have comprehensive & detailed
project plan; yet have the flexibility to adapt appropriately based on the uncertain circumstances

PROJECT MANAGEMENT
Objectives:
 Build a common understanding of the principles, practices and methodologies of project
management
 Share best practices related to project management
 Develop a community/network of project managers as a support system with on-going
resources for each other
What is a Project?
A project is defined as planned set of interrelated tasks to be carried out over a fixed and
defined period of time and within certain cost and other limitations to create a unique product,
service or result. It consists of a specific set of operations designed to accomplish a singular goal.

Why is there a need to manage a project?

All projects must be expertly managed to deliver the on-time, on-budget results, learning
and integration that organizations need. Project management oversees the planning, organizing
and implementing of a project.

What is Project Management?

"The application of knowledge, skills, tools and techniques to a broad range of activities in
order to meet the requirements of a particular project." –Project Management Institute, Inc.
“Unique process consisting of a set of coordinated and controlled activities with start and
finish dates, undertaken to achieve an objective conforming to specific requirements, including
constraints of time, cost and resources” –ISO 10006
“A time and cost constrained operation to realize a set of defined deliverables up to quality
standards and requirements” – IPMA
Project Ecosystem
Every project is dependent upon processes, people, and tools and they determine how the work
gets done. These three essential elements are not equal. Each has its own strengths and weaknesses,
and provides different values to projects
 Process
 People
 Tools

Project Constraints
A development project has to manage four basic constraints: scope, schedule, budget and
quality. The success of a project depends heavily on the ability, skills and knowledge of the project
manager to take into consideration these constraints and develop the plans and processes to keep
them in balance.
 Scope: the boundaries of the project
 Schedule: the time to complete the project activities
 Budget: the funding available to cover all expenses of the project
 Quality: achieving the expectation of the stakeholders

5 Basic Phases of Project Management

Project management is the discipline of using established principles, procedures and policies to
manage a project from conception through completion. The process of directing and controlling a
project from start to finish falls into five basic phases:
 Project conception and initiation
An idea for a project will be carefully conceptualized and examined to determine whether or not
it is beneficial for the organization. A decision-making body will identify if the project can
realistically be feasible and completed.
 Project definition and planning
A project plan, project charter and project scope may be put in writing and outlining the work to
be conducted. It is in this phase that a team should focus on the project, calculate a budget and
schedule, and determine what resources are needed.
 Project launch or execution
Resources' tasks are distributed and people involved are informed of theirduties and
responsibilities. Indispensable project-related information must be conveyed.
 Project performance, monitoring and control
Comparison between the project status and progress to the actual plan, as resources perform the
scheduled work, is carried out. During this phase, project managers may need to adjust schedules
or do what is necessary to keep the project on track.
 Project close
After project tasks are completed and the client has approved the outcome, an assessment and
evaluation are necessary to highlight project success and learn from project history.
Project Management Knowledge Areas
 Integration  Procurement
 Scope  Human resources
 Time  Communications
 Cost  Risk management
 Quality  Stakeholder management

Project Management Process

There are nine management processes that are relevant to development projects. These are
designed to help manage the different elements of a project. Different projects may have
different needs from each process.
A. Core Processes
1. Scope Management. It includes the processes involved in defining and
controlling all the activities that make up the project and that are required to
complete the project successfully. It involves four district steps: define the
scope, assign work, verify the scope, and adapt the scope
2. Schedule Management. This includes the development of a project schedule
that contains all project activities. The key steps of the schedule management
process are define the schedule, publish the schedule, monitor the schedule,
update the schedule
3. Budget Management. This is required to ensure that the project is completed
within the approved budget. It consists of steps such as defining the budget,
executing the budget, controlling the budget, and updating the budget.
4. Quality Management. This is the process to ensure that the project will satisfy
the needs of the beneficiaries. The four steps in quality management are quality
definition, quality assurance, quality control, and quality improvements.

B. Supporting Processes
1. Team Management. This includes the processes required to make the most
effective use of the people involved with the project. The steps during a team
management process are team identification, team building, team evaluation,
and team improvement.
2. Stakeholder Management. Stakeholders are all the people who have an
interest in the project, they are the most critical element for the success of the
project. The steps in this process are stakeholder mapping, stakeholder
relationship building, stakeholder evaluation, and stakeholder management
improvement.
3. Information Management. This includes the steps required to ensure timely
and appropriate generation, collection, dissemination, storage, and ultimate
disposition of project information. The steps in information management are
information planning, information management, information evaluation, and
information improvement.
4. Risk Management. This includes the processes concerned with identifying,
analyzing, and responding to project risks. The four steps in risk management
are risk planning, risk monitoring and response, risk evaluation, and risk plan
improvement.
 5. Contract Management. This includes the processes required to manage the
three types of contracts: grants, sub-grants and procurement contracts. Contract
management consists of four steps: develop the proposals, contract award,
review performance, and updates
Project Manager is a specifically trained individual hired to perform a specific function
within the organization to handle the project management needs.They work well under
pressure and are comfortable with change and complexity in dynamic environments.

Responsibilities of a Project Manager

 Define project goals.
 Outline the steps needed to attain those goals.
 Identify the resources needed to accomplish those steps.
 Determine the budget and time required for each of the steps, as well as the
project as a whole.
 Oversee the actual implementation and execution of the work
 Delivering the finished outcome.

Also, project managers implement controls to assess performance and progress against the
established schedule, budget and objectives laid out in the project management plan. Teams
of workers involved in a project often do not work together and effective project
management requires strong communication and negotiation skills. Their contributions to
the management include:
1. Cultivation of the people skills needed to develop trust and communication among
all of a project's stakeholders: its sponsors, those who will make use of the project's
results, those who command the resources needed, and the project team members.
2. They have a broad and flexible toolkit of techniques, resolving complex,
interdependent activities into tasks and sub-tasks that are documented, monitored
and controlled.
3. They adapt their approach to the context and constraints of each project.ç
4. They improve their own and their teams' skills through lessons-learned reviews at
project completion.

Types of project managers

 Program managers, responsible for multiple related projects.
 Portfolio managers, responsible for selection, prioritization and alignment of
projects and programs with an organization's strategy.

Project Management Methodologies

There are various methodologies that project managers can employ to manage projects.
 Agile: A methodology used for speed and flexibility, which features
short delivery cycles.
  Critical Chain Project Management (CCPM): An approach that focuses on the use
of resources, rather than on timelines.
 Critical Path Method (CPM): A step-by-step PM technique.
 PRINCE2: Originated and still widely used by the U.K. government to manage
projects, this approach has also been adopted by private industry internationally.
 Waterfall: A management style that is sequential in nature.
 Rapid Application Development (RAD): Most often used in software development
to encourage the quick development of applications, while still maintaining high
quality.
 PRiSM: focuses on sustainability and integrates that idea into project phases to
reduce negative environmental and social effects.
 Other approaches include: joint application development (JAD); the fountain
model; the spiral model; build and fix; and synchronize-and-stabilize.

TOTAL QUALITY MANAGEMENT

(Total Productivity Maintenance)

 It is a management method to long–term success over customer satisfaction. All

organization members contribute in improving processes, products, services, and
the culture in which they work.
 is the integration of all functions and processes within an organization in order to
achieve continuous improvement of the quality of goods and services. The goal is
customer satisfaction.
 Is an approach to improving the effectiveness and flexibilities of business as a
whole. It is essentially a way of organizing and involving the whole organization,
every department, every activity and every single person at every level.
 It ensures that the management adopts a strategic overview of the quality and
focuses on prevention rather than inspection.

Objectives of TQM
 Meeting the customer’s requirements is the primary objective and the key to
organizational survival and growth.
 The second objective of TQM is continuous improvement of TQM is continuous
improvement of quality. The management should stimulate the employees in
becoming increasingly competent and creative.
 Third, TQM aims at developing the relationship of openness and trust among the
employees at all levels in the organization.

Characteristics of TQM Leader

 Visible, Committed and  Strong Drivers
Knowledgeable  Communication of Values
 A Missionary Zeal  Organization
 Aggressive Targets  Customers Contact
The 8 Primary Elements of TQM
TQM is a management system for a customer-focused organization that includes all
personnel in constant enhancement. It uses strategy, data, and effective communications to
assimilate the quality discipline into the culture and activities of the organization.
1. Customer-focused
The customer finally governs the quality level. No matter what an organization does
to foster quality improvement—training employees, integrating quality into the
design process, upgrading computers or software, or buying new measuring tools—
the customer determines whether the efforts were worthwhile.

2. Total Employee Involvement

All personnel contribute in working toward common aims. Total employee
commitment can only be obtained after fear has been driven from the workplace,
when empowerment has occurred, and management has provided the proper
environment. High-performance work systems integrate continuous improvement
efforts with normal business operations. Self-managed work teams are one form of
empowerment.

3. Process-centered
Focus on process thinking is a fundamental part of TQM. A process is a series of
steps that take inputs from suppliers (internal or external) and transforms them into
outputs that are delivered to customers (again, either internal or external). The steps
required to carry out the process are defined, and performance measures are
continuously monitored in order to detect unexpected variation.

4. Integrated System
It is the horizontal processes interconnecting vertically structured departments that
is the focus of TQM.
 Everyone must understand the vision, mission, and guiding principles as
well as the quality policies, objectives, and critical processes of the
organization. Business performance must be monitored and communicated
continuously.
 Every organization has a unique work culture, and it is virtually impossible
to achieve excellence in its products and services unless a good quality
culture has been fostered. Thus, an integrated system connects business
improvement elements in an attempt to continually improve and exceed the
expectations of customers, employees, and other stakeholders.

5. Strategic and Systematic Approach

6. Continual Improvement
7. Fact-based Decision Making
8. Communications

Benefits of TQM
 Greater customer loyalty  Reduced service calls
 Market share improvement  Higher prices
 Higher stock prices  Greater productivity
Reasons for FAILURE:
TQM fails because:
 Top management sees no reason for change
 Top management is not concerned for its staff.
 Top management is not committed to the TQM program.
 The company loses interest in the program after six months.
 The workforce and the management do not agree on what needs to happen.
 Urgent problems intervene.
 TQM is imposed on the workforce, which does not inwardly accept it.
 No performance measure or targets are set, so progress cannot be measured.
 Processes are not analyzed, systems are weak and procedures are not written down.

RISK MANAGEMENT

Risk in itself is not bad; risk is essential to progress, and failure is often a key part of
learning. But we must learn to balance the possible negative consequences of risk against
the potential benefits of its associated opportunity. (Van Scoy, 1992)

Risk management is a series of steps whose objectives are to identify, address, and
eliminate software risk items before they become either threats to successful software
operation or a major source of expensive rework. (Boehm, 1989)

I. The Risk Management Practice

The risk management process can be broken down into two interrelated phases, risk
assessment and risk control, as outlined in Figure 1. These phases are further broken down.
Risk assessment involves risk identification, risk analysis, and risk prioritization. Risk
control involves risk planning, risk mitigation, and risk monitoring.

a. Risk Identification

In the risk identification step, the team systematically enumerates as many

project risks as possible to make them explicit before they become problems. There
are several ways to look at the kinds of software project risks, as shown in Table 1.
It is helpful to understand the different types of risk so that a team can explore the
possibilities of each of them.
  Generic risks are potential threats to every software project.
 Product-specific risks can be distinguished from generic risks because
they can only be identified by those with a clear understanding of the
technology, the people, and the environment of the specific product.
 Project risks are those that affect the project schedule or the resources
(personnel or budgets) dedicated to the project.
 Product risks are those that affect the quality or performance of the
software being developed.
 Finally, business risks are those that threaten the viability of the software,
such as building an excellent product no one wants or building a product
that no longer fits into the overall business strategy of the company.

There are some specific factors to consider when examining project, product, and
business risks. Some examples of these factors are listed here, although this list is meant to
stimulate your thinking rather than to be an all-inclusive list.
 People risks  Organizational and managerial
 Size risks risks
 Process risks  Customer risks
 Technology risks  Estimation risks
 Tools risks  Sales and support risks

Spontaneous and sporadic risk identification is usually not sufficient. There are various
risk elicitation techniques the team can use to systematically and proactively surface risks:
 Meeting
 Checklists/Taxonomy
 Comparison with past projects
 Decomposition

b. Analyze
After risks have been identified and enumerated, the next step is risk analysis.
Through risk analysis, we transform the risks that were identified into decision-making
information. In turn, each risk is considered and a judgment made about the probability
and the seriousness of the risk. For each risk, the team must do the following:
 Assess the probability of a loss occurring.
 Assess the impact of the loss if the loss were to occur.
 c. Prioritize
After the risks have been organized into a risk table, the team prioritizes the risks by
ranking them. It is too costly and perhaps even unnecessary to take action on every
identified risk. Some of them have a very low impact or a very low probability of occurring
or both. Through the prioritization process, the team determines which risks it will take
action on.
d. Plan
Risk management plans should be developed for each of the “above the line” prioritized
risks so that proactive action can take place. These actions are documented in the Action
column of the Risk Table (Table 2). Following are some examples of the kinds of risk
planning actions that can take place:
 Information buying
 Contingency plans
 Risk reduction
 Risk acceptance

e. Mitigate
Related to risk planning, through risk mitigation, the team develops strategies to
reduce the possibility or the loss impact of a risk. Risk mitigation produces a situation
in which the risk items are eliminated or otherwise resolved. These actions are
documented in the Action column of the Risk Table (Table 2). Some examples of risk
mitigation strategies follow:
 Risk avoidance
 Risk protection

f. Monitor
After risks are identified, analyzed, and prioritized, and actions are established, it is
essential that the team regularly monitor the progress of the product and the resolution of
the risk items, taking corrective action when necessary. This monitoring can be done as
part of the team project management activities or via explicit risk management activities.
Often teams regularly monitor their “Top 10 risks.”
g. Communicate
On-going and effective communication between management, the development team,
marketing, and customer representatives about project risks is essential for effective risk
management. This communication enables the sharing of all information and is the
cornerstone of effective risk management.
h. The Stakeholders of Risk Management
The three stakeholders are involved in risk management.
  The developer must systematically and continually enumerate all the possible risks
related to technical capability and making the schedule.
 The manager must lead the team to follow the risk management process to
proactively manage the project risks. The manager must also allocate resources for
proactive risks management.
 The customer must participate in the continual identification of risks.

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