How a thorough Project Plan Assists an Efficient Project Execution Part I
One of the most efficient functions of a project execution plan is to guide the project management personnel in monitoring and control of the project. In the execution of that function, project managers must ensure that the project does not deviate from the baseline plan, which incorporates project scope statement, cost management plan, work breakdown structure (WBS), schedule, and risk management plan. The baseline plan also includes a quality control plan which guides the project team to conform to requirements and specifications religiously, take preventive measures to eliminate rework, design, and manufacturing errors. In short, a solid execution plan focuses on achieving two interconnected tasks: to ensure the triple constraints- project scope (work), schedule (time), and cost (resources) are not off balance and to manage quality by eliminating or reducing variations. Project managers (PM) use various software, metrics, and charts to monitor project performance by comparing what is being done against what is planned to complete and taking actions to bring the project back on track if it goes off the rails.
This article attempts to create an efficient execution plan for a fictitious XYZ construction project. The plan includes project scope, the pricing estimating methods, cost control strategy, trade-offs, Learning Curve, and a recommendation for incorporating quality management initiatives, including quality movement, the cost of quality, and the implementation of Six Sigma strategy.
How a Complete Project Plan makes Efficient Project Execution Part II
Part I recap. The most efficient function of a project execution plan focuses on achieving two interconnected tasks: to ensure the triple constraints- project scope (work), schedule (time), and cost (resources) are not off balance and to manage quality by eliminating or reducing variations. Project managers use various software, metrics, and charts to monitor project performance by comparing what is done against what is planned to complete and taking actions to bring the project back on track if it goes off the rails.
Project management practitioners apply trade-off analysis in every aspect of the project, including insourcing and outsourcing (Make-or-Buy), contract negotiation, and crashing or non-crashing project activities, to name a few. To achieve a project objective often compels project management personnel to sacrifice the project scope, budget, schedule, or quality. An unwise choice of preceding one value for another can, however, determine the success and failure of a project. The imbalance between them impacts project qualities. External, as well as internal uncertainties, may also influence the outcome of trade-offs. Also, time, cost, and resources are separate parts, but they are interconnected. In other words, though time (schedule) is distinct from cost and human resources, they are interconnected. If a project schedule is extended due to scope creep, material and labor costs will be impacted. Performance is also affected if the cost is not enough to cover the scope enlargement. Project practitioners are required to fully understand the dynamics and intricacies of the interconnectedness of the project trilogy concept to make trade-offs.
Make-or-Buy Decision/ Insource or Outsource
The trade-off between insourcing (doing-it-yourself) or outsourcing (hiring an outsider or share project risk via insurance company) is central to the project management lifecycle. The outcome of that decision determines the nature, size, and length of the project scope. To make an insightful and informed decision, firms use the make-or-buy analysis tool to help them make a better trade-off between making a product in-house and outsourcing it to contractors. Cost analysis alone is not sufficient to determine the successful outcomes of a make-or-buy decision. The extent to which a firm establishes a relationship with other market factors is essential in making a make-or-buy analysis a success.
Buyer-supplier collaboration to solve problems and information sharing can further enhance business-to-business trust and the ability to amicably settle disputes and complete projects to the mutual interest of both parties. Researchers have explored other options –including renting available capital items and teaming with another firm to design and make materials and equipment (Project Management Institute [PMBOK Guide], 2005; Sousa, 2014).
The Trade-Off in Contract Negotiation
Contractual agreement duties and obligations affect a project is a timely completion in terms of time, cost, and performance. The priority is to be able to skillfully negotiate contracts that can meet the goal of buyers as well as sellers. Issues in contractual negotiation consist of a gamut ranging from essential contract elements – scope, schedule, performance, risk management, budget, technical issues, change management issues, insurance, travel matters, technological information costs- to terms and conditions of the contract. Sustainable success in contract negotiation stems from two fronts: team organization and a winnable strategy. The team should comprise multi-disciplinary professionals who are adept in law, technology, accounting, procurement, marketing, project management, leadership, and tact and diplomacy, to name a few. Each discipline or expert compliments the other teamers, but the synergy produces results that are greater than the collective individual contributions. A sustainable negotiation strategy focuses on the more significant price, a win-win, and a long-range objective and seeks to resolve issues reasonably. A negotiation where one wins it all may not be right for anyone. After all, if the contract price cannot fully cover all the expenses involved in completing the project according to plan, the buyer suffers the consequence as well.
Part III. How a thorough Project Plan Assists an Efficient Project Execution
Recap: The most efficient function of a project execution plan focuses on achieving two interconnected tasks: to ensure the triple constraints- project scope (work), schedule (time), and cost (resources)- are not off balance and to manage quality by eliminating or reducing variations.
Part III of this article discusses Crashing and Non-Cashing Trade-Offs, Learning Curves, Quality Management Initiatives, and Cost of Quality.
Identifying and assessing risks associated with time, cost, and performance to make a better trade-off constitute a significant challenge to project management practitioners. Risk treatment or response also requires tough choices and tradeoffs. If the risk assessment report indicates that specific excavation activity is a high probability risk and is cost-consuming, the project manager may either add more funds to the project contingency budget or outsource or transfer the risk as trade-offs. Buying an insurance plan for specific machines, especially sophisticated equipment, is another choice to make if a risk probability is high. Sometimes, cost distribution among some activities compared to others may be uncharacteristic and unrealistic. Resource allocation will have to be re-evaluated as soon as possible to avoid a budget overrun and avert a potential resource depletion.
Crashing and Non-Cashing Trade-Offs
Completing project activities on schedule, especially those on the critical path, is strategic to meeting business. The advantage of completing a crucial software project on or before completion time means your client has the chance to take more share of the market.
Learning Curves Results
Learning Curves is extremely useful in production planning, cost forecasting, and setting delivery schedules. As employees continue to do the same work repeatedly, they tend to experience and master it. In time, the job becomes second nature. This adds cost value to their organization in the following ways: It enhances labor productivity and efficiency and reduces performance, product lifecycle, and costs that are related to labor and upkeep of the business. It also reduces managerial control and waste. In other words, the more employees become experienced and knowledgeable, the more they reduce the likelihood of human error, waste associated with ineptitude, and sloppiness.
Quality Management Initiatives
Quality management interweaves in every phase of the project; that is why without quality assurance and control planning, the likelihood of a product recall, redesign and rework increases. Product recalls cause businesses $ billion a year. To make things right the first time, business organizations and individuals have instituted several quality management initiatives to get rid of the causes of product defects, design errors, reworks, and recalls, to name a few examples. These standards and processes include continuous process improvement (CPI), learning, Six Sigma, Lean, Kaizen, and ISO 9000 Standards. The overall objectives of these standards are to reduce variation, eliminate activities that add no value to a project, and to improve customer satisfaction.
ISO 9000 defines quality management framework and processes that an organization can use to improve quality management, such as continuous improvement. Total quality management focuses on complete customer satisfaction and measurement and continuous improvement, engagement of stakeholders, and team members. Six Sigma attempts to reduce defects to near zero threshold to achieve six standard deviations of 3.4 errors or defects per millions. An effective quality control plan also defines, analyzes, measures, and improves project quality. The project manager uses the Six Sigma concept to, among other things, analyze the cause-and-effect of the project, put in place statistical process control mechanisms and standard operating procedures to measure, evaluate and continue to improve every aspect of the project from start to finish. A quality management plan should also incorporate Just-In-Time and Kanban to reduce wastes by uncluttering the production process. Cost of Quality. Quality cost consists of are associated with prevention, appraisal, training, failure, monitoring, and controlling quality objectives. There are also internal and external costs of quality. Domestic quality costs include recycle, reuse, rework, scrap, and defects. Different prices are the loss of credibility, litigation cost, warranty, and loss of customers.
Keeping an eye on cost, time, performance, and creating a balance between them is essential in achieving the project objective. However, the ultimate success of the application of project monitoring and control tools such as Learning Curve analysis, trade-offs, and statistical process control, can be in jeopardy if products or services do not meet quality standards. Besides, while cost, time, and performance are key factors to project monitoring and control, there are also internal and external risks. The internal factors include instability or chaos due to ego, power rivalry, and resistance within the project hierarchy or merely being reactive instead of being proactive in taking corrective action to put cost under control. External issues to monitor and control include inflation, strike, currency fluctuation, economic downturn, and political instability in a foreign country, which is a principal supplier of goods and services to the project or business. Issues such as added work, change requests, and vandalism, to name a few examples, can also pose a severe threat to project success if there is no risk management plan.
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