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Earned Value Management is one of the classic techniques of project management which is mainly used to analyse & evaluate the development & performance of a project. The Earned Value Management consists of different parameters which help in determining the schedule variance & cost variance with respect to a project (Parikh, 2017).

Advantages

One of the foremost advantages of this is that it helps in determining the work schedule and the budget schedule of a project and therefore helps in finding out whether the project is going on as per the pre-determined schedule or costs or there has been variance in any  or both of the parameters. In absence of any direct qualitative or quantitative measurements for measuring the project performance, senior management can use this as a tool to have an overview of the project (Gupta, 2014).

Another advantage is that the tool Earned Value Management helps the management identify the problems with the schedule or the cost and thereby helps in determining the root causes of the problems. This helps them to take proactive steps so that the problems could be corrected and the project could be brought under schedule or budget control.

Limitations

One of the foremost limitations of the tool Earned Value Management is that fact that this tool only focuses on the Project Time & Project Cost and none other parameters are taken into consideration. For this reason, the quality of the project is not being evaluated. Thus the quality of the project is only seen after the completion of the project itself (Patil, et al., 2012).

The other problem lies in the fact that the management needs to have constant monitoring process by the help of which the parameters needs to be measured. This may often create rift between management & the workers and also invites high cost incurrence (Czemplik, 2014).

Table of Contents

Question 2​6

Abstract​6

Question 2 (a)​6

1.​Organization & Project​6

2.​Revised Project Charter​7

3.​Updated Project Management Plan​9

Question 2 (b)​17

Report to Project Sponsor​17

References​20

Question 2 – Word Count (3621)

Abstract

The organization considered is Balfour Beatty Plc., an engineering & construction company. The project considered, is the development of a 4 mile 4 lane highway in UK as sponsored by the UK government only. However, the project has started almost 8 months back and at this current position, the project lags by two months due to the casual approach and the change of scope by the sponsors as well as the developers. This analysis will involve planning the development of the processes which will be further used to correct the project and to bring it back in line with the pre-defined schedule. In discussing the implementation plan, several suggestions have been given with respect to the process optimization and time reduction of the process along with maintaining the quality of the project itself.

Question 2 (a) – Word Count (2481)

1. Organization & Project

Organization

The organization considered for this project is Balfour Beatty Plc. Balfour Beatty Plc is a Multinational company with its headquarter situated in London, UK. The company has major customers mostly in UK & US, however the company’s operations are spread across Canada, Australia, and Middle-East & South East Asia. Balfour Beatty is one of the largest companies in terms of being a construction contractor. As for the company is considered, the company operates across three business lines namely, the construction services, support services & Infrastructure Investments. In the Construction Services, the company is involved in building, designing and managing construction, repair, and refurbishment, fit-out of mechanical & electrical services, ground engineering, rail engineering & civil engineering. In the support services business line the company is involved in the process of installation, maintenance & Upgradation of the different utility services, street & public space management, maintenance & operations. In the infrastructure investments segments, the company tries to find out new opportunities for investments along with retaining its old assets (Alsulamy, et al., 2012).

Project

The project that is to be discussed here is the project involving the building of a 4 mile 4 Lane road in UK, with a total budgeted costs of approximately $5 Million. The time for completion of this road was approximately 2 years. The activities have been listed in the Project Charter (revised). Though the project has commenced almost 8 Months ago, the project is at present running 2 months behind schedule. The main reason for the same was delay in getting a proper understanding of the timelines as well as the work scope. The critical activities have not been sequenced properly along with the absence of definite milestones. The clear date of completion is also not there. The procurement delays have also added to the woes (Atkinson, et al., 2006). The personnel management plan is also at a mess due to improper planning. Scope creep also threatens to delay the delivery by one more month. In order to meet the timeline, the quality was compromised in certain areas, which again took long time to be rectified. Above all the poor communication plan has also been one of the main reason for the project delay (BELEIU, et al., 2013).

2. Revised Project Charter

Project Goal

The goal of this project is to build a 4 Mile long 4 lane highway and for that reason Balfour Beatty has been hired by the government for the execution of the plan itself.

Project Participants

The main two participants of this project are:

• Government who is the Project Sponsor

• Balfour Beatty Plc., who is the Project implementer

• Other Stakeholders are being described in the Stakeholder chart below

Stakeholders

There are different stakeholders involved in the project (Bakker, et al., 2011). The main project participants as mentioned above are the Government & the company Balfour Beatty Plc. However, while looking into details the several stakeholders involved are:

• Investors or the Sponsors (In this case the UK Government)

• The Project Team (Internal team), employees, managers, project managers

• The Customer (In this case Government)

• Benefiters (In this case general public)

• Local Communities, who will be affected by the operations of the project.

• Media or the press

• Competitors who will be closely watching the success of the project

• Suppliers of the raw materials

• Sub-Contractors

Requirements

To complete the project of building a 4 mile 4 lane highway within a time period of 2 years. Already 8 months have passed and the project is lagging behind 2 months of schedule. So the project needs to be accelerated with the help of extra resource allocation along with fast forwarding the procurement so that the different processes are being optimized and finished (Banaitiene & Banaitis, 2012).

Milestones

WBS Nos

Tasks

Milestones

1

Road Preparation

Project Completed till 6 months of work but the time gone is 8 months. So now Milestones will be set after each major task with strict deadlines as described in the revised cost chart below.

1.1

Business Justification

1.2

Feasibility Study

1.3

Project Brief

1.4

Concept Design

Milestone – 1

1.5

Hiring Sub-Contractors

Milestone – 2

1.6

Obtaining Licenses

Milestone – 3

1.7

Mobilization

Milestone – 4

1.8

Construction

Milestone – 5

1.9

Closing Period

Milestone – 6

Additional 1 Month Relaxation given for 1 Month by Sponsor

Table: Adding Project Milestones to the Rest of the Project Work Left

Communication

In order to deal with the revised project statements and the set charter, the company needs to communicate various rules & strict measures to all the stakeholders. The measures will ensure proper completion of the project within the due time. The communication to the different stakeholders are:

Stakeholders

Communication

• Investors or the Sponsors (In this case the UK Government)

The investors must be sent written documents about confirmation of the project and about how the project needs to be completed within the set timeline.

• The Project Team (Internal team), employees, managers, project managers

The project team needs to be communicated about strengthening the rule in terms of achieving each milestones and in the process maintain high quality.

• The Customer (In this case Government)

The customer or the Government should be given written confirmation about the project due date completion.

• Benefiters (In this case general public)

Public displays should be put up in the place of construction, thereby announcing the benefits the general public will be enjoying after the completion of the highway.

• Local Communities, who will be affected by the operations of the project.

The local communities made be made aware of the benefits and should also be engaged in the local work as a part of the project. This communication should be made well in advance before the starting of the construction activity.

• Media or the press

The media or press should be made aware of the proceedings and the updates.

• Competitors who will be closely watching the success of the project

The competitors would come to know about the progress from Media & press only.

• Suppliers of the raw materials

Communication with respect to the MOU or strict following of the rules would be communicated, failing which the company would have to look for other suppliers.

• Sub-Contractors

Communication with respect to the MOU or strict following of the rules would be communicated, failing which the company would have to impose heavy fines.

Table: Stakeholder Communication, Source: (Bobrowski, 2009)

Deliverables – Project, Schedule & Costs

The deliverable for this project is a 4 Mile long 4 lane highway, at an estimated timeline of approximately 2 years or 24 months. The project cost as estimated by Balfour Beatty Plc. at the start of the project is approximately $4.85 Mn or approximately $5 Million. The company wants to deliver the project within the said timeline & the decided budget as per the Project Charter. However, due to the issues of scope creep, the sponsors have agreed to delay the timeline by 1 month more or to complete the total deliverable in 25 months. However, due to the lag that took place, due to the presence of improper planning & approach by both the customer and the company, the project at present is completed for 8 months, but the work has been completed for only 6 months. Thus the project needs to revamp and deeply extra sources. That is causing a rise in the project cost to about 10% & the estimated final budget for delivering the project within time has been revised to $5.5 Million.

3. Updated Project Management Plan

Project Integration Management

The Project Integration Management as planned should be done in co-ordination with the project manager, who will be the major person responsible for the project delivery. The Project Charter will be used to initiate the integration plan, while project management plan will be used for planning further steps (Bobrowski, 2009). The Execution project plan will be used to deliver the deliverables for the revised project charter. However, at all steps proper measures should be taken in order to ensure proper management & control of the different stakeholders in the process. The well-defined KPIs as defined by the Quality Management Team, should be linked to all the Milestones as linked above and then make frequent checks with respect to the meeting of those KPIs. Those checks and balances will further help in determining the success of the project.

Fig: Project Integration Management Framework

Project Scope Management

The work Breakdown structure of the whole project given as:

WBS Nos

Tasks

Sub-Tasks

Sub-Sub-Tasks

1

Road Preparation

1.1

Business Justification

1.1.1

Defining Needs

1.1.2

Business Case Preparation

1.1.3

Establishing Internal Team

1.1.4

Initial Strategic Brief preparation

1.2

Feasibility Study

1.2.1

Hiring Consultants

1.2.2

Developing Strategic Brief

1.2.3

Developing Execution Plan

1.3

Project Brief

1.4

Concept Design

1.4.1

Detail Design Finalized

1.5

Hiring Sub-Contractors

1.5.1

Tender of Sub Contractors

1.5.2

Selecting Sub-Contractors

1.5.3

Sub-Contractor Deal Finalized

1.6

Obtaining Licenses

1.7

Mobilization

1.8

Construction

1.8.1

Starting the Construction

1.8.2

Preparing Site

1.8.3

Road Construction

1.8.3.1

Procure Resources

1.8.3.2

Deploy Labour

1.8.3.3

Construction

1.9

Closing Period

 Misc.

Project Scope Creep

Table: WBS for the Project

 

Project Time Management

WBS Nos

Tasks

Sub-Tasks

Sub-Sub-Tasks

Revised Time Line (Months)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

1

Road Preparation

1.1

Business Justification

8

1.1.1

Defining Needs

1.1.2

Business Case Preparation

1.1.3

Establishing Internal Team

1.1.4

Initial Strategic Brief preparation

1.2

Feasibility Study

1.2.1

Hiring Consultants

1.2.2

Developing Strategic Brief

1.2.3

Developing Execution Plan

1.3

Project Brief

1.4

Concept Design

1.4.1

Detail Design Finalized

1.5

Hiring Sub-Contractors

1.5.1

Tender of Sub Contractors

0.5

1.5.2

Selecting Sub-Contractors

0.25

1.5.3

Sub-Contractor Deal Finalized

0.25

1.6

Obtaining Licenses

1

1.7

Mobilization

0.25

1.8

Construction

1.8.1

Starting the Construction

0.25

1.8.2

Preparing Site

0.5

1.8.3

Road Construction

1.8.3.1

Procure Resources

12

1.8.3.2

Deploy Labour

12

1.8.3.3

Construction

12

1.9

Closing Period

1

Project Scope Creep

1

Table: Revised Gantt chart for the Project

Assumptions:

• All the tasks are being done serially (Bourne, 2013).

• Practical assumptions take with respect to  the decrease in the work days for certain tasks

• The three tasks under consideration namely Procuring Resources, deploying Labour & Construction are done simultaneously

• The resource cost increase has been considered as per the proportion of decrease in time

 

Project Cost Management

Sl Nos

Tasks

Sub-Tasks

Sub-Sub-Tasks

Time Requirement (Months)

Revised Time Line (Months)

Affect in Work Tasks

Results

Costs

Costs

1

Road Preparation

1.1

Business Justification

8

1.1.1

Defining Needs

1

$                                100,000.00

$                             100,000.00

1.1.2

Business Case Preparation

0.5

$                                100,000.00

$                             100,000.00

1.1.3

Establishing Internal Team

0.25

$                                100,000.00

$                             100,000.00

1.1.4

Initial Strategic Brief preparation

0.5

$                                100,000.00

$                             100,000.00

1.2

Feasibility Study

1.2.1

Hiring Consultants

0.3

1.2.2

Developing Strategic Brief

1

$                                125,000.00

$                             125,000.00

1.2.3

Developing Execution Plan

1

$                                  75,000.00

$                               75,000.00

1.3

Project Brief

0.2

$                                  50,000.00

$                               50,000.00

1.4

Concept Design

1.4.1

Detail Design Finalized

1.25

$                                100,000.00

$                             100,000.00

1.5

Hiring Sub-Contractors

1.5.1

Tender of Sub Contractors

0.75

0.5

Reduced by 7.5 Days

Extra Resource cost of 33.33%

$                                  25,000.00

$                               33,250.00

1.5.2

Selecting Sub-Contractors

0.5

0.25

Reduced by 7.5 Days

Extra Resource cost of 50%

$                                  25,000.00

$                               37,500.00

1.5.3

Sub-Contractor Deal Finalized

0.25

0.25

$                                200,000.00

$                             200,000.00

1.6

Obtaining Licenses

1

1

$                                200,000.00

$                             200,000.00

1.7

Mobilization

0.5

0.25

Reduced by 7.5 Days

Extra Resource cost of 50%

$                                100,000.00

$                             150,000.00

1.8

Construction

1.8.1

Starting the Construction

0.5

0.25

Reduced by 7.5 Days

Extra Resource cost of 50%

$                                  50,000.00

$                               75,000.00

1.8.2

Preparing Site

0.5

0.5

Reduced by 15 Days

Extra Resource cost of 50%

$                                500,000.00

$                             750,000.00

1.8.3

Road Construction

1.8.3.1

Procure Resources

13

12

Reduced by 1 Month

Extra Resource cost of 10%

$                            1,000,000.00

$                         1,100,000.00

1.8.3.2

Deploy Labour

13

12

Extra Resource cost of 10%

$                            1,000,000.00

$                         1,100,000.00

1.8.3.3

Construction

13

12

Extra Resource cost of 10%

$                            1,000,000.00

$                         1,100,000.00

1.9

Closing Period

1

1

Project Scope Creep

1

Total

24

25

$                            4,850,000.00

$                         5,495,750.00

Comments

2 Years

1 Month Scope Creep Allowed

Below $5 Million

The Budgeted Cost has increased in order to finish the project within the timeline defined.

Work That was planned to be completed within the first 8 Months

Work Completed within the First 8 Months

Table: Cost Management

The Costs Management of the project shows that there has been an increase in the cost to $5.49575 Million which is an approximately increase of 9.912 % or almost 10% increase that what is present in the Project Charter. But this is the shortest most increase in the cost by keeping the timeline fixed and strict.

Project Quality Management

The project under consideration is already lagging behind in the schedule, hence the project manager should ensure proper quality management through following procedures:

• Developing a root cause analysis in order to determine the root causes of the delay in the past and thereby taking proactive actions to prevent the delay.

• Communicating properly with the stakeholders so that each one of them are aware of the high standards quality that Balfour Beatty promises its customers.

• Following the Milestones rigidly (Care.org, 2007).

• Developing certain Quality Management KPIs for the project, which needs to be monitored on a frequent basis so as to check the quality of the deliverable at each milestone. This will help in ensuring Quality Assurance to the customer

Project human Resource Management

The Project Human Resource Management mainly ensures controlling the different stakeholders who are involved in the project. Already a detail plan with regards to the communication has been sorted out. In this section, the details about booking the resources for further completion of the project. Booking the resources well ahead will ensure timely availability of the man power along with the presence of raw materials and machines which will ensure timely completion of the projects (Cooke-Davies, 2002).

Project Communications Management

The project communication management plan has been detailed before, with the help of the different stakeholder communication plan. The most important among them are the communications to the employees which must come from the senior management, communication to the suppliers for ensuring ready availability of the materials & communication to the sub-contractors for instructing them to stick to the timelines.

Project Procurement Management

The procurement management of the project needs to be corrected and strengthened with respect to the procurement of the raw materials along with the availability of the resources.

• The resources need to be booked for further work well ahead in time (PM4DEV, 2016).

• The Project team must sign MOUs with the suppliers with regards to the procurement of the raw materials timely. Simultaneously the procurement team in the project, should start evaluating the other suppliers who are there to supply the same raw materials. This will help in developing the substitute suppliers and thereby change suppliers in case of issues with the supply.

Question 2 (b) – Word Count (1007)

Report to Project Sponsor

The steps for the project sponsor is being defined below:

Steps for Revised Project Completion

Steps Taken

Explanation of the Steps

Steps for Enabling Project Completion

Signed MOUs with the Suppliers

The MOU will ensure proper delivery of the raw materials at the correct time & place. Failure to do so will result in application of high fines to be done by Balfour Beatty Plc. to the vendors.

The fear and the high fine charges will result in creation of deterrence among the suppliers who will start to deliver on time aligned with the new MOUs. Also the suppliers are aware of the situation that Balfour Beatty Plc., would be looking for substitute suppliers if they fail to meet the quality standards. Hence timing & quality will be taken care of.

Proper Communication with the employees, managers, project teams

This will help in removal of the casual approach by the employees or the managers who were in the beginning not proactive enough to book the resources.

Resources booked in advance will completing the right work at the right time without any difficulty.

The transparent communication will also ensure assurance against any apprehensive negative decisions by the employer.

Signing MOUs with Sub-Contractors

This will ensure the sub-contractors to follow the timeline strictly and to help Balfour Beatty achieve the milestones after each successful task completion.

The fear of the heavy fines if the MOU is not honored will result in a creation of proactive approaches who in turn will help in achieve the milestones in due time and to finish the work actively along the critical path without causing much delay.

Setting Milestones at the end of each of the remaining Major Tasks to be completed.

The Milestones will help check further variation.

As the project is already two months behind schedule, hence Balfour Beatty is in no position to delay the project even at the critical path. Hence the Milestones at the end of each step will ensure the goal achievement within the pre-determined time limit.

Defining Quality Parameters

KPI’s help in monitoring and in tracking progress.

The KPIs defined by the Quality Assurance team, will help in monitor the quality of work and completion of the work in defined time. These KPIs will act as an enabler to control project.

The Tender Subcontractor time is reduced by 0.25 month or 7.5 days

This will help in accommodate the project lag time of 2 months.

Tender Sub-Contractors cost will increase by 33.3%. Helps in accommodating the time by 0.25 month.

Selecting the sub-contractor costs will be reduced by 7.5 Days

Selecting subcontractor costs will increase by 50%

This will help in accommodating the project lag time by 0.25 months.

Time for mobilization is reduced by 7.5 Days

Mobilization costs will be increased by 50%

This will help in accommodating the project lag time by 0.25 month.

Construction starting days reduced by 7.5 Days

Constructions Starting will increase by 50%

This will help in accommodating the project lag time by 0.25 month.

Site Preparation days reduced by 15 days.

Site preparation sites will increase by 50%

This will help in accommodating the project lag time by 0.50 month.

Procurement time reduced by 1 month.

Procurement costs to increase by 10%

This will help in accommodating the project lag time by 1 month. As these three sub-tasks are being done simultaneously, hence the 1 month need to be accommodated from all the tasks.

Labour deployment time reduced by 1 month.

Labour Deployment costs to increase by 10%

Construction time reduced by 1 month.

Construction costs to increase by 10%

Scope Creep

1 Month Already allowed by sponsor

This 1 month is already being adjusted with the scope creep into the project.

Table: Steps for Revised Project Completion

Assumptions:

• While designing a project it is always a good practice by Balfour Beatty Plc. to introduce lag in the project completion time along with creating some tasks or sub-tasks which can be overlapped later.

• Also all the tasks are shown to be completed one after the other, except the last three sub-sub-tasks. But in reality some of the tasks as mentioned above can be overlapped with each other for taking out more time. Thus all the lag timings have been removed from the tasks and the Gantt chart as shown above is based on the Critical Path of the project only (considering all tasks to be done serially).

• The costs will increase proportionally with the proportional decrease in time.

• New resources are available at disposal. For achieving this high level of planning is required from the very first day of starting to review the project.

Revised Costs

The total costs that was being planned in the former project charter was approximately around $5 Million. As per the previous Project charter the total costs that was being planned was approximately $4.85 Million. But the revised project charter has certain components which will incur more costs. The more costs will be incurred owing to the fact that some of the tasks will be made to be completed within shorter periods that previous planned project charter. Thus in the revised project charter, some of the tasks will be made to be completed in shorter period of time while, the costs incurred in them will be higher in the proportion the time is being reduced. Thus the costs would be higher only in terms of the resource costs.

The revised costs include:

• Tender Sub-Contractors cost will increase by 33.3%

• Selecting subcontractor costs will increase by 50%

• Mobilization costs will be increased by 50%

• Constructions Starting will increase by 50%

• Site preparation sites will increase by 50%

• Procurement costs to increase by 10%

• Labour Deployment costs to increase by 10%

• Construction costs to increase by 10%

As per the Revised Project Charter, the Revised Project Costs will increase by 9.915% or the revised costs will be $5.49575 Million. Thus from the estimated costs of $5 Million as per Former Project Charter, the revised plan will cost $0.49575 MN more.

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