WBS and Risk

The Project Management Institute defines a WBS as “A deliverable-oriented grouping of project elements that organizes and defines the total work scope of the project. Each descending level represents an increasingly detailed definition of the project work”

There are three reasons to use a WBS in your projects.  Firstly it, helps to more accurately and precisely define and categorise the scope of the total project. This is usually done by means of using a hierarchical tree structure. Each level of this structure breaks the project deliverables or objectives down to more specific and quantifiable chunks. The second reason for using a WBS in your projects is to help with assigning responsibilities, resource allocation, monitoring the project, and controlling the project. The WBS makes the deliverables more precise and concrete so that the project team knows exactly what has to be accomplished within each deliverable. This also allows for better estimating of cost, risk, and time because you can work from the smaller tasks back up to the level of the entire project. Finally, it allows you double check all the deliverables' specifics with the stakeholders and make sure there is nothing missing or overlapping.

For example please see below the WBS for a football tournament

In order to understand which areas of the project might require special attention, and whether there are any recurring risk themes, or concentrations of risk on a project, it would be helpful if there were a simple way of describing the structure of project risk exposure.

 Simple list of risk sources does not provide the richness of the WBS since it only presents a single level of organization. A better solution to the structuring problem for risk management would be to adopt the full hierarchical approach used in the WBS, with as many levels as are required to provide the necessary understanding of risk exposure to allow effective management. Such a hierarchical structure of risk sources should be known as a Risk Breakdown Structure (RBS). Following the pattern of the WBS definition above, the RBS is defined here as “A source-oriented grouping of project risks that organizes and defines the total risk exposure of the project. Each descending level represents an increasingly detailed definition of sources of risk to the project.” The RBS is therefore a hierarchical structure of potential risk sources. The value of the WBS lies in its ability to scope and define the work to be done on the project; similarly the RBS can be an invaluable aid to understanding the risks faced by the project. Just as the WBS forms the basis for many aspects of the project management process, so the RBS can be used to structure and guide the risk management process.

There are six stages of the project management process, we will now take a look at the second phase also known as the “definition phase”. After the project plan (stage one) has been approved, the project enters the second phase: the definition phase. In this phase, the requirements that are associated with a project result are specified as clearly as possible. This involves identifying the expectations that all of the involved parties have with regard to the project result. During this phase, a project plan and project scope may be put in writing, outlining the work to be performed.  According to the book project management fifth edition project scope should include the following stages.

•     Project deliverables
•   Project Milestone
• Technical Requirements
• Limits and exclusion
• Customer review

The project management team should prioritize the project, calculate a budget and schedule, and determine what resources are needed. The project definitions should be in sync with that of the client and end user requirements.

It is at this stage that the Project manager and its participants can use the scope of the project as a tool in order to measure the success of the project. It is very important that all parties that are involved in the project are able to collaborate during the definition phase, particularly the end users who will be using the project result. The client, who pays for the project, is indeed invited to collaborate on the requirements during the definition phase. Nonetheless, the project result benefits when its future users are also invited. As a point of departure, it is helpful to make a habit of organising meetings with all concerned parties during the definition phase of a project

This involves identifying the expectations of all parties involved with regard to the project result. It is important to identify the requirements as early in the process as possible. The Preconditions for the project, Functional & Operational requirements and Design limitations should be clearly defined in this phase.

Risk is associated with things that are unknown. More things are unknown at the beginning of a project, but risk must be considered in the initiation phase and weighed against the potential benefit of the project’s success in order to decide if the project should be chosen.

Poory defined project scope has been cause of 50% of all project failures according to the book written by Larson and Grey Project management 5th Edition. Scope creep can lead to risk when the project scope is not defined accurately. Project scope refers to alterations that have been made or introduced as the project progress. These can include things like newly defined costs or other add-ons. An example of project scope is what is currently happening with the new children’s Hospital and the increased costs.

Project Screening Process and the the Multi-Weighted Scoring Models operates

Detail the Project Screening Process as it is applied to an organisation of your choice, describe the role of those involved and explain how the Multi-Weighted Scoring Models operates

I will now apply the Project screening process to IKEA. Recently within IKEA they have undertaken some major projects. The first step of every project begins with the proposed idea.  In IKEAs situation the idea generation which was proposed was the “aisle width project”.

The situation was taken to not only widen the aisle but to also go higher with them. The idea was put forward after some research was conducted by way of root cause analysis on aisles which had forklift damage occurring regularly to some of the stock within the warehouse. Additional factors such as Brexit and capacity issues which IKEA have been experiencing due to growth resulted in the decision to also higher the aisles in order to allow for greater capacity. In both cases the ROI and strategic fit where assessed. IKEA have long had a strategy of “serving the many people”. This has resulted in 10% growth year on year within the Dublin store resulted in capacity issues. The aisle width project worked alongside IKEAs strategy.  At the same time IKEA also wanted to create more inspiration within the store and completely revamp the IKEA showroom.

Both projects are needed and work alongside the strategic fit of the organistion. However both projects would not be able to be under taken at the same time as this would cause too much of a disruption to the everyday business. This is where the prioritizing of projects are crucial. This can be an uncomfortable process for managers. It is vitally important to remain unbiased to project you feel more passionate about as opposed to what makes a better business decision. Once the decision was taken which project to lead with then top level management where presented with the proposal and the green light given if they were happy with the project proposal. The main decision in this case was we would more sales location and stock locations in the warehouse if IKEA created a new inspirational showroom. As it stood IKEA where tight on space. The decision was taken to increase capacity and driver efficiency and then create a new inspirational showroom. Some organization use a project priority system to help them priorities projects.

Once the top level management have said the project can be implemented, the budget is set after having a minimum of three contractors price the job. Once the budget has been set IKEA then create a project team. The project team consists of Individuals who are deemed as experts in the field being undertaken. In this case the logistics manager was removed from his role and given the project managers rolled and his position was filled temporarily. This allows the project manager give their full attention to the job at hand. IKEAmust also evaluate what resources can be allocated to the project.

“Management of a portfolio system requires two major inputs from senior management. First, senior management must provide guidance in establishing selection criteria that strongly align with the current organization strategies. Second, senior management must annually decide how they wish to balance the available organizational resources (people and capital) among the different types of projects”

Multi-Weighted Scoring models.

Weighted Scoring. A weighted scoring model is a tool that provides a systematic process for selecting projects based on many criteria. Apply the scoring rubric to assign raw scores for each criterion to each project. Multiply the raw scores by the weights to get the weighted scores for each criterion on each project.

Above is an example of the weighted scoring model. The total weight of the weighted score must add to 100%. After this you list all of the requirements deemed applicable to the project in question. For example these may include time frame, budgets and other important criteria. In order to get the final weighted score of each project a simple calculation is required. Please see below example.

The project with the highest weighted score is deemed the project to choose. An example can be seen below

  

The Irish government and project failure

Briefly Research a public sector project. Describe the project and suggest why it failed with reference to the Lars Mieritz "Gartner Survey Shows Why Projects Fail" article. 

The project I have chosen to discuss is the new children’s hospital which is currently being built on the St. James hospital site. This project has yet to be completed but will already be deemed a failure on the following grounds.

·         Will finish over budget

·         Not completed in the projected time scale.

·         Not all amenities which where required will operate as planned.

Gartner describes the above as some of the main reason as to why projects fail. I will now demonstrate how each of the above apply to the project I have chosen.

 The plan for the new children's hospital began almost 33 years. Applying the time scale element to the project, it was first reported that the new hospital would be built in 2015, however in 2012 An Board Pleánala refused planning permission for the site at the Mater hospital. Since then the site has moved to St. Jameses hospital. Leo Varadkar announced that the hospital would open in 2020, however this has now been pushed back until August 2022.

In order for a project to be deemed successful it is also required that the budget comes in within the budget allocation. Yet again the Irish Government have displayed their poor project management of the hospital. Originally the project was set to cost €790 million, yet most recently the project now looks set to cost in the region of €1.4 billion.

As Gartner says “Many large projects fail because business conditions keep changing after the project scope has been set, leaving a significant disconnect between the agreed-on scope and budget versus what the business will require and pay for by the time the project is delivered”.  The Irish Government have done exactly this. Perhaps the case could be argued that the Government are perhaps not as careful as they would be if it was their own business.

If we look at some of the amenities that the hospital where to have, one of which was to have a Helicopter pad on site for emergencies. This will be located on the fourth floor but unfortunately the coast guards helicopter is too heavy and will have to land at least a mile away where an ambulance will finish the journey. This could have been avoided if the green field site at Connolly hospital had of been chosen.

If we look at what is known as the triple constraint two of the key elements of project management is time scale and cost, both of which the Irish government have failed to manage.

It would seem the Government have also lacked adequate planning for this project. Far better options where available and which would have eliminated the parking issue which will arise in the new children's hospital, ease of access, all which cause for needless stress at a time where calm is of the essence. Perhaps the government should look at outsourcing future projects and leave them in the hands of those who will look out for the interests of the entire country,

Going forward the government should as stated by Gartner

“ need to be aware of and address changes in the environment, and understand that cost, scope and schedule are not weighted equally. By maintaining close ties to sponsors and stakeholders, and being upfront regarding the trade-offs between functionality scope and schedule, expectations can be re-calibrated on an ongoing basis, thus improving success rates.”