ABB Basic Quality Tools Series

4Q Basic Project Management

Tools to assist completion of 4Q Project objectives
on time and on cost.

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15 July 2010, Slide 1
 4Q Basic Project Management Tools - Content
What is it for?
4Q Project Management tools allow projects to be managed and
controlled to deliver agreed objectives on time and to cost.
To support execution of multiple tasks to implement and sustain the
4Q solutions

Where could I use them?

At phases throughout a 4Q project
Charter before Q1
Work Breakdown Structure Q3 & Q4
SMART Action lists throughout the project
4Q Process
PERT Plan Q3 & Q4
Q1 - Measure Q2 - Analyze
Gantt Chart Q3 & Q4
Project Control Q3 & Q4 Define opportunity. Identify and confirm root
Risk Management Q3 & Q4 Investigate to understand causes of the problem.
the current state in detail.
How do I use them?
Develop and agree Project Charter Q4 - Sustain Q3 - Improve
Agree & Select PM tools to be used Maintain the improvements Develop, pilot, and
Use each tool appropriately in the 4Q project by standardizing the work implement solutions that
methods or processes. eliminate root causes.
Examples

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15 July 2010, Slide 2
 4Q Basic Project Management Tools

4Q Process
Q1 - Measure Q2 - Analyze

Define opportunity. Investigate Identify and confirm root

to understand the current state causes of the problem.
in detail.

Q4 - Sustain Q3 - Improve

Maintain the improvements by Develop, pilot, and implement

Work Breakdown Structure
standardizing the work solutions that eliminate root
Charter methods or processes. causes.
Reduce Raw
Material Stock-Out

Identify raw materials Calculate the ideal Track the actual Modify the safety stock
Build the
that safety stock is safety stock level for consumption on safety level according to the
safety stock
needed each type of material stock for 1 month actual consumption

Review demand variation Review the suppliers

in last 6 months for each performance in last 6 months
type of material for each type of material

Gantt Chart

PERT

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15 July 2010, Slide 3
 4Q Basic Project Management - What is it for?
Uses of these tools:
4Q Basic Project Management ensures that project objectives are defined, agreed and completed
on time and to cost.
Several tools Project Management Tools are available to support this aim:
Charter ensures a 4Q project is clearly scoped and resourced with SMART objectives and
that these are agreed with and supported by the Project Sponsor.
SMART Action lists ensures clearly defined task lists are developed and monitored.
Work Breakdown Structure a tool which helps to divide the project tasks into a manageable
structure
PERT Plan Describes task sequencing
Gantt Chart provides a timeline of tasks to be complete and allows them to be tracked
clearly.
Project Control allows regular review of the plan with associated responses.
Risk Management facilitates consideration of risks to project objectives and responses.
Expected Benefits:
Project objectives are clearly defined and agreed at the start.
Project activities are organised, clear for all to see.
Progress can be tracked and deviations from the plan can be responded to immediately as
appropriate.
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15 July 2010, Slide 4
 Project Charter - Overview
Background: Uses:
The use of Project Charters is important for Used to state and confirm the problem to be
stating the goal for a 4Q project what is addressed, the scope and objectives.
trying to be addressed, why, how, when and
Used to seek agreement and approval with the
by whom.
Project Sponsor prior to start (Q1).
Used to review project

How to use it: Benefits:

Document the Problem description, scope, Helps to clarify the problem being addressed.
project goal and schedule. - use techniques
Ensures agreement and approval of project scope
such as SMART
and objectives with the sponsor.
Document major assumptions, and specific
Ensures expected resources (including team),
requirements.
timelines and costs are clear and understood at
If a budget is assigned, this needs to be the start.
indicated.

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15 July 2010, Slide 5
Project Charter

4Q Project Charter
Problem Description

Project Goal
Major Assumption eg. production volume is 100 pcs/day
(optional)
Requirement eg. data to be retrieved from SAP system
(optional)
Budget
(if any)
Schedule Start date: End date:
Project Team
Role Name Title/Department
Project Sponsor
Project Leader

Team Members

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15 July 2010, Slide 6
 Work Breakdown Structure (WBS) - Overview
Background: Uses:
The concept of Work Breakdown Structure Use WBS to help to convert a project into many
developed with the PERT (see later) in the specific tasks at different levels.
US Department of Defense.
It helps to organize and define the total work
In 1968, the DoD issued a military standard scope of the project.
requiring the use of work breakdown
For Basic 4Q projects, usually measurement and
structures across the DoD.
analysis is simple and quick to complete. WBS
will be used in Q3 and Q4.

How to use it: Benefits:

Draw as a Tree Diagram with Project Goal at Gives a clear way of representing the work/tasks
the top to be completed
Use items in the action list created in Q3
The WBS should include all of the work
defined by the project scope and captures all
outputs/deliverables.
Detailed tasks needed to get actions done.
Brainstorm and use Post-it Notes to
assemble the WBS to everyone's agreement.

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15 July 2010, Slide 7
Work Breakdown Structure - Example

Reduce Raw
Material Stock-Out

Identify raw materials Calculate the ideal Track the actual Modify the safety stock
Build the
that safety stock is safety stock level for consumption on safety level according to the
safety stock
needed each type of material stock for 1 month actual consumption

Review demand variation Review the suppliers

in last 6 months for each performance in last 6 months
type of material for each type of material

Example: WBS the work reduce raw material stock-out

WBS is a Tree Diagram

WBS helps to convert a project into many specific tasks at
different levels.
All tasks should be SMART.
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 PERT - Overview
Background: Uses:
PERT stands for Program Evaluation & To plan, analyze and coordinate tasks within a
Review Technique project
PERT was developed by consultants at Booz Useful for organizing tasks and establishing time
Allen Hamilton for the U.S. Navy in 1957 to frames, and for showing tasks that depend on
support the development of missile programs. other tasks
PERT chart is a task and event oriented PERT is used in projects where time rather than
technique cost is the major consideration.

How to use it: Benefits:

From the WBS the project team decides Gives a clear way of representing the
which tasks should be milestones, and also dependencies and order of work/tasks to be
decides their proper sequence. completed
Estimate the optimistic, normal and PERT is helpful to plan what tasks can go on
pessimistic times for each task simultaneously to reduce time.
A project can be roughly scheduled when not Allows identification of the critical path and the
knowing the precise durations of all tasks. minimum time needed to complete the total
project.
Draw the PERT Network Diagram
Provides for potentially reduced project duration
due to better understanding of dependencies.
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15 July 2010, Slide 9
PERT Chart - Example
Program Evaluation Review Technique (PERT) chart
To plan, analyze and coordinate tasks within a project
Useful for organizing tasks and establishing timeframes,
and for showing tasks that depend on other tasks

Example: PERT Chart for Safety Stock management

Task Name Estimated Time Resource
Q3 Identify raw materials that safety stock is needed 3 days Ada
Q3 Review demand variation in last 6 months for each type of material 5 days Mike
Q3 Review supplier performance in last 6 months for each type of material 5 days Ron
Q3 Calculate the ideal safety stock level for each type of material 2 days Ada
Q3 Build the safety stock 10 days Ada
Q3 Track the actual consumption on safety stock for 1 month 30 days Ada
Q4 Modify the safety stock level according to the actual consumption 3 days Ada

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15 July 2010, Slide 10
 Gantt Chart - Overview
Background: Uses:
Gantt charts have become a common A Gantt Chart helps to visualize and plan project
technique for representing the activities of a tasks with start and finish dates, and then helps
project , so they can be understood by a wide to track execution progress.
audience. Gantt Charts are able to show the dependency
The chart is named after Henry Gantt, who relationships between tasks, the critical path, and
developed it between1910 and1915. the current completion status.

How to use it: Benefits:

The project team coverts theWBS or PERT Gives a clear way of representing the
into a time phased Gantt chart. dependencies and order of work/tasks to be
completed
Several tools can be used for drawing Gantt
Charts e.g. Microsoft Project, Excel or a Gantt is helpful to plan what tasks can go on
white board. simultaneously to reduce time.
Project progress is tracked on a regular basis Allows identification of the critical path and the
and modified as needed. minimum time needed to complete the total
project.
The 4Q Project Gantt chart is owned by the
project leader and should be accessible to all Allows both planning and monitoring/control
team members and sponsor
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15 July 2010, Slide 11
Gantt Chart - Example
Gantt Chart helps to visualize and plan project tasks with start and finish
dates, and then helps to track execution progress.

Example: Gantt Chart for Safety Stock management

Gantt Chart by Microsoft Project can show the dependency

relationships between tasks, critical path, and current status by
using %-complete.

ABB Group 9AKK105151D0119

15 July 2010, Slide 12
 Project Control - Overview
Background: Uses:
Project Control is key to project management. Project Control ensures that regular project
It supports the project management in reviews occur to check KPI trends, the schedule
supervising and governing a project and it is and budget.
significant for the success of it. Important changes or decisions must be agreed
Project Control is linked to the foundation of and documented into the plan
Project Management as a discipline.

How to use it: Benefits:

Use the Gantt chart to tell if the project is on Allows project progress monitoring & quick
schedule and KPIs to see if the project is response to change.
progressing in the right direction.
Good communication leads to good projects.
Hold a regular project review (daily or weekly)
via meetings or reports. Motivates the team .

Document and act on any changes or

critical decisions such as changes on goals,
solution, team members, or schedule should
be documented in a standard format, and well
informed to relevant people.

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15 July 2010, Slide 13
Project Control - Example

Project time schedule tracking

Project KPI tracking Today

Progress monitor and control is critical

Gantt chart to track the progress by
checking the task completion against Safety
the schedule Stock
Level
Checklist, and measurements tracking
to tell if project is progressing on the Time
right track
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15 July 2010, Slide 14
Project Control - Example
Regular project review to check KPI trends, the schedule and budget.
Important changes or decisions must be agreed and documented into the plan
Good communication leads to good projects.
Acknowledge team members contribution. Continuous motivation.
If change is difficult, find the change agents

The one progressing the fastest

10
8

ahead of schedule
6
4
Days of critical path
2
0
2
4

behind schedule
6
10 8

The one delayed the most

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15 July 2010, Slide 15
 Risk Management - Overview
Background: Uses:
A risk is an uncertain event or set of events, Risk Management is the application of principles,
that if they occur, will have an effect on the approaches and processes to the task of
achievement of project objectives. identifying risks and then implementing risk
responses.
Risk is measured as a combination of the
probability of a perceived threat and the Mitigation tasks are necessary for risk
magnitude of its impact on objectives. management.
Mitigation actions need to be included by Q3 or
Q4 in the plan.

How to use it: Benefits:

Consider all risks to the project which affect It allows the project to save money and time if you
project targets e.g. cost, quality, benefits deal with uncertain project events in a proactive
and scope. Brainstorm with team. manner.
Assess each risk in turn for consequence, Minimises the impact of project threats.
impact and probability of occurring.
Identify appropriate mitigation tasks and Allows the project to be delivered on time, on
include in the project plan. budget and with the quality results the project
sponsor expects.
Anyone can raise a risk.
Avoids "fire fighting.

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 Risk Management - Example

If any risks are predicted in planning, they need to be addressed

Mitigation tasks are necessary

Risk Consequence Impact/ Cost Probability Mitigation

To describe To describe possible High /Medium High /Medium Mitigation plan 1
the risk consequences /Low /Low Mitigation plan 2

Mitigation tasks must be included in the project plan.

e.g.. Demand fluctuation is a big risk for stock-out. One of mitigation is to update sales
forecast frequently and share the information of upcoming big orders with suppliers timely

Task Name Estimated Time Resource

Q3 Identify raw materials that safety stock is needed 3 days Ada
Q3 Review demand variation in last 6 months for each type of material 5 days Mike
Q3 Review supplier performance in last 6 months for each type of material 5 days Ron
Q3 Calculate the ideal safety stock level for each type of material 2 days Ada
Q3 Build the safety stock 10 days Ada
Q3 Track the actual consumption on safety stock for 1 month 30 days Ada
Add the Q4 Modify the safety stock level according to the actual consumption 3 days Ada
mitigation Q4 Retrieve the latest sales forecast from sales, and highlight large volume orders Every Fri afternoon Mike
to the task Share sales forecast of large volume orders with suppliers and request them to
Q4 Every Mon morning Ada
be prepared
list
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15 July 2010, Slide 17