Business Finance
Texas A&M University Kingsville Project Planning Questions

Texas AM University Kingsville

Question Description

I’m studying for my Management class and don’t understand how to answer this. Can you help me study?

  1. Define project cost terms and tell how each is used in estimating project cost.
  2. Compare and contrast analogous, parametric, and bottom-up methods of estimating costs.
  3. Describe issues in project cost estimating and how to deal with each.


Answer each question in minimum of 250 words,use the text book attached for reference

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Project Management Project Management Adrienne Watt BCCAMPUS VICTORIA, B.C. Project Management by Adrienne Watt is licensed under a Creative Commons Attribution 4.0 International License, except where otherwise noted. © 2014 Adrienne Watt The CC licence permits you to retain, reuse, copy, redistribute, and revise this book—in whole or in part—for free providing the author is attributed as follows: Project Management by Adrienne Watt is used under a Creative Commons Attribution 4.0 International Licence. If you redistribute all or part of this book, it is recommended the following statement be added to the copyright page so readers can access the original book at no cost: Download for free from the B.C. Open Textbook Collection. Sample APA-style citation: This textbook can be referenced. In APA citation style, it would appear as follows: Watts, A. (2014). Project Management. Victoria, B.C.: BCcampus. Retrieved from https://opentextbc.ca/projectmanagement/. Cover image attribution: Colors and lines… by Shashank Gupta is used under a Creative Commons Attribution 4.0 International Licence. Ebook ISBN: 978-1-77420-013-1 Print ISBN: 978-1-77420-012-4 Visit BCcampus Open Education to learn about open education in British Columbia. This book was produced using Pressbooks.com, and PDF rendering was done by PrinceXML. Contents Accessibility Statement About the Book vi viii Introduction x Preface xi 1. Project Management: Past and Present 2. Project Management Overview 3. The Project Life Cycle (Phases) 1 11 24 4. Framework for Project Management 5. Stakeholder Management 6. Culture and Project Management 7. Project Initiation 8. Overview of Project Planning 9. Scope Planning 10. Project Schedule Planning 11. Resource Planning 12. Budget Planning 13. Procurement Management 14. Quality Planning 15. Communication Planning 16. Risk Management Planning 17. Project Implementation Overview 18. Project Completion 19. Celebrate! 27 42 54 57 73 76 91 105 132 147 157 169 175 186 188 193 Appendix 1: Project Management PowerPoints 194 Appendix 2: Chapter Questions 195 Appendix 3: Chapter Audio Files 203 About the Author 204 Versioning History 205 List of Links by Chapter for Print 207 Accessibility Statement BCcampus Open Education believes that education must be available to everyone; this means supporting the creation of free, open, and accessible educational resources. We are actively committed to increasing the accessibility and usability of the textbooks we produce. Accessibility features of the web version of this resource The web version of Project Management includes the following features: • It as been optimized for people who use screen-reader technology: ◦ all content can be navigated using a keyboard ◦ links, headings, tables use proper markup ◦ all images have text descriptions • It includes an option to increase font size (see tab on top right of screen titled, “Increase Font Size.”) • Audio files are available for each chapter (see Appendix 3: Chapter Audio Files). Other file formats available In addition to the web version, this book is available in a number of file formats including PDF, EPUB (for eReaders), MOBI (for Kindles), and various editable files. Here is a link to where you can download this book in another file format. Look for the Download this book drop-down menu to select the file type you want. This book links to a few external websites. For those using a print copy of this resource, the link text is underlined, and you can find the web addresses for all links in the back matter of the book. Known accessibility issues and areas for improvement The PowerPoint slides available for download from Appendix 1: Project Management PowerPoints have not been checked for accessibility. In addition, external websites linked to from this text may not meet accessibility guidelines. Let us know if you are having problems accessing this book If any of the above accessibility issues are stopping you from accessing the information in this textvi 2nd Edition vii book, please contact us to let us know and we will get it fixed. If you discover any other issues, please let us know of those as well. Please include the following information: • The location of the problem by providing a web address or page description • A description of the problem • The computer, software, browser, and any assistive technology you are using that can help us diagnose and solve your issue e.g., Windows 10, Google Chrome (Version 65.0.3325.181), NVDA screen reader You can contact us one of the following ways: • Contact form: BCcampus Support • Web form: Report an Open Textbook Error This statement was last updated on September 18, 2019. About the Book About the Book Project Management by Adrienne Watt and published by BCcampus Open Education is a remix and adaptation of the following works: • 100 Percent Rule by Pabipedia licensed under © CC BY-SA (Attribution-ShareAlike). • Communication Plans by Inte6160 Wiki licensed under Creative Commons Attribution 3.0 Licence. • Decision Matrix Method and Project Charter by Wikipedia the Free Encyclopedia licensed under CC BY-SA (Attribution-ShareAlike). • Gantt Chart by Wikipedia licensed under CC BY-SA (Attribution-ShareAlike). • How to Build Relationships with Stakeholders by Erin Palmer licensed under CC BY (Attribution). • Planning a Project by OpenLearn Labspace licensed under Creative Commons Attribution 3.0 Licence. • Project Decelerators – Lack of Stakeholder Support by Jose Solera licensed under CC BY (Attribution). • Project Management by Merrie Barron and Andrew Barron licensed under CC BY (Attribution). • Project Management for Instructional Designers by Amado, M., Ashton, K., Ashton, S., Bostwick, J., Clements, G., Drysdale, J., Francis, J., Harrison, B., Nan, V., Nisse, A., Randall, D., Rino, J., Robinson, J., Snyder, A., Wiley, D., & Anonymous licensed under Creative Commons Attribution 3.0 Licence. • Project Management for Skills for All Careers by Project Management Open Resources and TAP-a-PM licensed under Creative Commons Attribution 3.0 Licence. • Project Management from Simple to Complex by Russel Darnall, John Preston, Eastern Michigan University licensed under Creative Commons Attribution 3.0 Licence. • Project Management/PMBOK/Human Resources Management and Development Cooperation Handbook/How do we manage the human resources of programmes and projects?/Manage the Project Team by Wikibooks licensed under CC BY-SA (Attribution-ShareAlike). • Project Management/PMBOK/Scope Management and Development Cooperation Handbook/ Designing and Executing Projects/Detailed Planning or design stage by Wikibooks licensed under © CC BY (Attribution). • Resource Management and Resource Leveling by Wikipedia licensed under CC BY-SA (Attribution-ShareAlike). viii 2nd Edition ix • Work Breakdown Structure by Wikipedia licensed under CC BY-SA (Attribution-ShareAlike). About BCcampus Open Education BCcampus Open Education began in 2012 as the B.C. Open Textbook Project with the goal of making post-secondary education in British Columbia more accessible by reducing student costs through the use of openly licensed textbooks and other OER. BCcampus supports the post-secondary institutions of British Columbia as they adapt and evolve their teaching and learning practices to enable powerful learning opportunities for the students of B.C. BCcampus Open Education is funded by the British Columbia Ministry of Advanced Education, Skills & Training, and the Hewlett Foundation. Open textbooks are open educational resources (OER) created and shared in ways so that more people have access to them. This is a different model than traditionally copyrighted materials. OER are defined as teaching, learning, and research resources that reside in the public domain or have been released 1 under an intellectual property license that permits their free use and re-purposing by others. Our open textbooks are openly licensed using a © Creative Commons licence, and are offered in various e-book formats free of charge, or as printed books that are available at cost. For more information about open education in British Columbia, please visit the BCcampus Open Education website. If you are an instructor who is using this book for a course, please fill out our Adoption of an Open Textbook form. 1. "Open Educational Resources," Hewlett Foundation, https://hewlett.org/strategy/open-educational-resources/ (accessed September 27, 2018). Introduction People have been undertaking projects since the earliest days of organized human activity. The hunting parties of our prehistoric ancestors were projects. Large complex projects such as the pyramids and the Great Wall of China were also projects. Even something as simple as creating a dinner is considered a project. We use the term “project” frequently in our daily conversations. This book covers the basics of project management. This includes the process of initiation, planning, execution, control, and closeout that all projects share. x Preface The primary purpose of this text is to provide an open source textbook that covers most project management courses. The material in the textbook was obtained from a variety of sources. All the sources are found in the reference section at the end of each chapter. I expect, with time, the book will grow with more information and more examples. I welcome any feedback that would improve the book. If you would like to add a section to the book, please let me know. xi 1. Project Management: Past and Present Careers Using Project Management Skills Skills learned by your exposure to studying project management can be used in most careers as well as in your daily life. Strong planning skills, good communication, ability to implement a project to deliver the product or service while also monitoring for risks and managing the resources will provide an edge toward your success. Project managers can be seen in many industry sectors including agriculture and natural resources; arts, media, and entertainment; building trades and construction; energy and utilities; engineering and design; fashion and interiors; finance and business; health and human services; hospitality, tourism, and recreation; manufacturing and product development; public and private education services; public services; retail and wholesale trade; transportation; and information technology. Below we explore various careers and some of the ways in which project management knowledge can be leveraged. Business Owners Business owners definitely need to have some project management skills. With all successful businesses, the product or service being delivered to the customer meets their needs in many ways. The product or service is of the quality desired, the costs are aligned with what the consumer expected, and the timeliness of the product or service meets the deadline for the buyer of that item. The pillars of project management are delivering a product/service within schedule, cost, scope, and quality requirements. Business owners need planning, organizing, and scoping skills and the ability to analyze, communicate, budget, staff, equip, implement, and deliver. Understanding the finances, operations, and expenses of the business are among the skills that project managers learn and practice. Some businesses may focus more on accounting, providing financial advice, sales, training, public relations, and actuary or logistician roles. Business owners may own a travel agency or provide hospitality. Business owners could be managing a storefront or a location in their town’s marketplace. Example: Restaurant Owner/Manager Restaurant managers are responsible for the daily operations of a restaurant that prepares and serves meals and beverages to customers. Strong planning skills, especially coordinating with the various departments (kitchen, dining room, banquet operations, food service managers, vendors providing the supplies) ensure that customers are satisfied with their dining experience. Managers’ abilities to recruit and retain employees, and monitor employee performance and training ensure quality with cost containment. Scheduling in many aspects, not only the staff but also the timing of the food service deliveries, is critical in meeting customer expectations. Risk management is essential to ensure food safety and quality. Managers monitor orders in the kitchen to determine where delays may occur, and they work with the chef to prevent these delays. Legal compliance is essential in order for the restaurant to stay open, so restaurant managers direct the clean1 1. Project Management: Past and Present 2 ing of the dining areas and the washing of tableware, kitchen utensils, and equipment. They ensure the safety standards and legality, especially in serving alcohol. Sensitivity and strong communication skills are needed when customers have complaints or employees feel pressured because more customers arrive than predicted. Financial knowledge is needed for the soundness of running the restaurant, especially tracking special projects, events, and costs for the various menu selections. Catering events smoothly can be an outcome of using project plans and the philosophy of project management. The restaurant manager or the executive chef analyzes the recipes to determine food, labour, and overhead costs; determines the portion size and nutritional content of each serving; and assigns prices to various menu items, so that supplies can be ordered and received in time. Planning is the key for successful implementation. Managers or executive chefs need to estimate food needs, place orders with distributors, and schedule the delivery of fresh food and supplies. They also plan for routine services (equipment maintenance, pest control, waste removal) and deliveries, including linen services or the heavy cleaning of dining rooms or kitchen equipment, to occur during slow times or when the dining room is closed. A successful restaurant relies on many skills that the project management profession emphasizes. Outsourcing Services Figure 1.1: Sample status chart, which is typical with the use of a red-yellow-green Many businesses explore outsourcing for certain services. Below is a sample status and project plan that reflects the various tasks needed for a project. A review of finances, the importance of communicating to stakeholders, and the importance of time, cost, schedule, scope, and quality are reflected. Many companies may use these steps in their business. These plans show the need for the entire team to review the various proposals to choose the best plan. Figure 1.1 represents a sample project status report. 3 2nd Edition Example: Construction Managers Construction managers plan, direct, coordinate, and budget a wide variety of residential, commercial, and industrial construction projects including homes, stores, offices, roads, bridges, wastewater treatment plants, schools, and hospitals. Strong scheduling skills are essential for this role. Communication skills are often used in coordinating design and construction processes, teams executing the work, and governance of special trades (carpentry, plumbing, electrical wiring) as well as government representatives for the permit processes. A construction manager may be called a project manager or project engineer. The construction manager ensures that the project is completed on time and within budget while meeting quality specifications and codes and maintaining a safe work environment. These managers create project plans in which they divide all required construction site activities into logical steps, estimating and budgeting the time required to meet established deadlines, usually utilizing sophisticated scheduling and cost-estimating software. Many use software packages such as Microsoft Project® or Procure® or online tools like BaseCamp®. Most construction projects rely on spreadsheets for project management. Procurement skills used in this field include acquiring the bills for material, lumber for the house being built, and more. Construction managers also coordinate labor, determining the needs and overseeing their performance, ensuring that all work is completed on schedule. Values including sustainability, reuse, LEED-certified building, use of green energy, and various energy efficiencies are being incorporated into today’s projects with an eye to the future. Jennifer Russell, spoke about project management and global sustainability” at the 2011 Silicon Valley Project Management Institute (PMI) conference. She informed the attendees of the financial, environmental, and social areas in expanding the vision of project management with the slide in Figure 1.2. These values are part of the PMI’s code of ethics and professionalism. By adhering to this code, project managers include in their decisions the best interests of society, the safety of the public, and enhancement of the environment. 1. Project Management: Past and Present 4 Figure 1.2: In addition to considering the cost, scope, and schedule of a project, a project manager should work to ensure the project is socially responsible, environmentally sound, and economically viable. Creative Services Creative service careers include graphic artists, curators, video editors, gaming managers, multimedia artists, media producers, technical writers, interpreters, and translators. These positions use project management skills, especially in handling the delivery channel and meeting clients’ requirements. Let us look at one example, graphic artists, to understand and identify some of the project management skills that aid in this career. Example: Graphic Artists Graphic artists plan, analyze, and create visual solutions to communication problems. They use many skills found in project management, especially communications. They work to achieve the most effective way to get messages across in print and electronic media. They emphasize their messages using colour, type, illustration, photography, animation, and various print and layout techniques. Results can be seen in magazines, newspapers, journals, corporate reports, and other publications. Other deliverables from graphic artists using project management skills include promotional displays, packaging, and marketing brochures supporting products and services, logos, and signage. In addition to print media, graphic artists create materials for the web, TV, movies, and mobile device apps. Initiation in project management can be seen in developing a new design: determining the needs of the client, the message the design should portray, and its appeal to customers or users. Graphic designers consider cognitive, cultural, physical, and social factors in planning and executing designs for the target 5 2nd Edition audience, very similar to some of the dynamics a project manager considers in communicating with various project stakeholders. Designers may gather relevant information by meeting with clients, creative staff, or art directors; brainstorming with others within their firm or professional association; and performing their own research to ensure that their results have high quality and they can manage risks. Graphic designers may supervise assistants who follow instructions to complete parts of the design process. Therefore scheduling, resource planning, and cost monitoring are pillars of project management seen in this industry. These artists use computer and communications equipment to meet their clients’ needs and business requirements in a timely and cost-efficient manner. Educators “Educator” is a broad term that can describe a career in teaching, maybe being a lecturer, a professor, a tutor, or a home-schooler. Other educators include gurus, mullahs, pastors, rabbis, and ...
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Running Head: QUESTIONS AND ANSWERS

Questions and Answers
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QUESTIONS AND ANSWERS

Questions and Answers
1. Define project cost terms and tell how each is used in estimating project cost.
The process of predicting the quantity, cost, and prices of resources to be used in a project is
known as cost estimation. It is important to note that project cost estimation has a degree of
uncertainty since it uses predictions and forecasting. The risk arises from the fact that the project
has not been fully completed yet. Some costs might arise in the course of the project. Project cost
estimation is essential for different reasons. These include; investment decisions, comparing
alternative plans, and budgeting. Project cost estimation is vital in making decisions in the
organization. It helps project managers make decisions regarding the amount of money to invest
and the number of resources they need. It is, therefore, ascertained that project management is
used in the estimation of a project (Jahangir et al, 2001).
There are different project cost estimation methods. It is important to note that all these
are used in different ways in regards to the project. The first type is the analogous review. This
type of project cost estimation is also known as historical data analysis. This project cost
estimation method involves using previous projects to estimate the cost of the current project. In
essence, this type of project cost estimation depends on historical data. This type of cost
estimation is used in combination with other tools. The second type of project ...

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