ABB Basic Quality Tools Series 4Q Basic Project Management Tools to assist completion of 4Q Project objectives on time and on cost. © ABB Group 9AKK105151D0119 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 Gantt Chart – Q3 & Q4 Project Control – Q3 & Q4 Risk Management – Q3 & Q4 How do I use them? • Develop and agree Project Charter • Agree & Select PM tools to be used • Use each tool appropriately in the 4Q project Examples © ABB Group 9AKK105151D0119 15 July 2010, Slide 2 Q1 - Measure Define opportunity. Investigate to understand the current state in detail. Q4 - Sustain Maintain the improvements by standardizing the work methods or processes. Q2 - Analyze Identify and confirm root causes of the problem. Q3 - Improve Develop, pilot, and implement solutions that eliminate root causes. 4Q Basic Project Management Tools 4Q Process Q1 - Measure Define opportunity. Investigate to understand the current state in detail. Q4 - Sustain Maintain the improvements by standardizing the work methods or processes. Charter Q2 - Analyze Identify and confirm root causes of the problem. Q3 - Improve Develop, pilot, and implement solutions that eliminate root causes. Work Breakdown Structure Reduce Raw Material Stock-Out Identify raw materials Calculate the ideal that safety stock is safety stock level for needed each type of material Review demand variation in last 6 months for each type of material Build the safety stock Review the suppliers performance in last 6 months for each type of material Gantt Chart PERT © ABB Group 9AKK105151D0119 15 July 2010, Slide 3 Track the actual consumption on safety stock for 1 month Modify the safety stock level according to the actual consumption 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. © ABB Group 9AKK105151D0119 15 July 2010, Slide 4 Project Charter - Overview Background: Uses: • The use of Project Charters is important for stating the goal for a 4Q project – what is trying to be addressed, why, how, when and by whom. • Used to state and confirm the problem to be addressed, the scope and objectives. • Used to seek agreement and approval with the Project Sponsor prior to start (Q1). • Used to review project How to use it: Benefits: • Document the Problem description, scope, project goal and schedule. - use techniques such as SMART • Helps to clarify the problem being addressed. • Document major assumptions, and specific requirements. • If a budget is assigned, this needs to be indicated. © ABB Group 9AKK105151D0119 15 July 2010, Slide 5 • Ensures agreement and approval of project scope and objectives with the sponsor. • Ensures expected resources (including team), timelines and costs are clear and understood at the start. Project Charter 4Q Project Charter Problem Description Project Goal Major Assumption eg. production volume is 100 pcs/day (optional) Requirement (optional) eg. data to be retrieved from SAP system Budget (if any) Schedule Start date: End date: Project Team Role Project Sponsor Project Leader Team Members © ABB Group 9AKK105151D0119 15 July 2010, Slide 6 Name Title/Department Work Breakdown Structure (WBS) - Overview Background: Uses: • The concept of Work Breakdown Structure developed with the PERT (see later) in the US Department of Defense. • Use WBS to help to convert a project into many specific tasks at different levels. • In 1968, the DoD issued a military standard requiring the use of work breakdown structures across the DoD. • It helps to organize and define the total work scope of the project. • For Basic 4Q projects, usually measurement and 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 the top • Gives a clear way of representing the work/tasks 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. © ABB Group 9AKK105151D0119 15 July 2010, Slide 7 Work Breakdown Structure - Example Reduce Raw Material Stock-Out Identify raw materials Calculate the ideal that safety stock is safety stock level for needed each type of material Review demand variation in last 6 months for each type of material Build the safety stock Track the actual consumption on safety stock for 1 month Modify the safety stock level according to the actual consumption Review the suppliers performance in last 6 months 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. © ABB Group 9AKK105151D0119 15 July 2010, Slide 8 PERT - Overview Background: Uses: • PERT stands for Program Evaluation & Review Technique • To plan, analyze and coordinate tasks within a project • PERT was developed by consultants at Booz Allen Hamilton for the U.S. Navy in 1957 to support the development of missile programs. • Useful for organizing tasks and establishing time frames, and for showing tasks that depend on other tasks • PERT chart is a task and event oriented technique • PERT is used in projects where time rather than cost is the major consideration. How to use it: Benefits: • From the WBS the project team decides which tasks should be milestones, and also decides their proper sequence. • Gives a clear way of representing the dependencies and order of work/tasks to be completed • Estimate the optimistic, normal and pessimistic times for each task • PERT is helpful to plan what tasks can go on simultaneously to reduce time. • A project can be roughly scheduled when not knowing the precise durations of all tasks. • Allows identification of the critical path and the 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. © ABB Group 9AKK105151D0119 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 Q3 Q3 Q3 Q3 Q3 Q3 Q4 Task Name Identify raw materials that safety stock is needed Review demand variation in last 6 months for each type of material Review supplier performance in last 6 months for each type of material Calculate the ideal safety stock level for each type of material Build the safety stock Track the actual consumption on safety stock for 1 month Modify the safety stock level according to the actual consumption © ABB Group 9AKK105151D0119 15 July 2010, Slide 10 Estimated Time Resource 3 days Ada 5 days Mike 5 days Ron 2 days Ada 10 days Ada 30 days Ada 3 days Ada Gantt Chart - Overview Background: Uses: • Gantt charts have become a common technique for representing the activities of a project , so they can be understood by a wide audience. • A Gantt Chart helps to visualize and plan project tasks with start and finish dates, and then helps to track execution progress. • The chart is named after Henry Gantt, who developed it between1910 and1915. • Gantt Charts are able to show the dependency relationships between tasks, the critical path, and the current completion status. How to use it: Benefits: • The project team coverts theWBS or PERT into a time phased Gantt chart. • Gives a clear way of representing the 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 white board. • Project progress is tracked on a regular basis and modified as needed. • The 4Q Project Gantt chart is owned by the project leader and should be accessible to all team members and sponsor © ABB Group 9AKK105151D0119 15 July 2010, Slide 11 • Gantt is helpful to plan what tasks can go on simultaneously to reduce time. • Allows identification of the critical path and the minimum time needed to complete the total project. • Allows both planning and monitoring/control 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. It supports the project management in supervising and governing a project and it is significant for the success of it. • Project Control ensures that regular project reviews occur to check KPI trends, the schedule and budget. • Project Control is linked to the foundation of Project Management as a discipline. • Important changes or decisions must be agreed and documented into the plan How to use it: Benefits: • Use the Gantt chart to tell if the project is on schedule and KPIs to see if the project is progressing in the right direction. • Allows project progress monitoring & quick response to change. • Hold a regular project review (daily or weekly) via meetings or reports. • 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. © ABB Group 9AKK105151D0119 15 July 2010, Slide 13 • Good communication leads to good projects. • Motivates the team . Project Control - Example Project time schedule tracking Project KPI tracking  Progress monitor and control is critical  Gantt chart to track the progress by checking the task completion against the schedule  Checklist, and measurements tracking to tell if project is progressing on the right track © ABB Group 9AKK105151D0119 15 July 2010, Slide 14 Today Safety Stock Level Time 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” 8 10 The one progressing the fastest 4 2 0 2 4 behind schedule 6 10 8 Days of critical path 6 ahead of schedule © ABB Group 9AKK105151D0119 15 July 2010, Slide 15 The one delayed the most Risk Management - Overview Background: Uses: • A risk is an uncertain event or set of events, that if they occur, will have an effect on the achievement of project objectives. • Risk Management is the application of principles, approaches and processes to the task of identifying risks and then implementing risk responses. • Risk is measured as a combination of the probability of a perceived threat and the magnitude of its impact on objectives. • Mitigation tasks are necessary for risk 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 project targets – e.g. cost, quality, benefits and scope. Brainstorm with team. • It allows the project to save money and time if you deal with uncertain project events in a proactive manner. • Assess each risk in turn for consequence, impact and probability of occurring. • Minimises the impact of project threats. • Identify appropriate mitigation tasks and include in the project plan. • Allows the project to be delivered on time, on budget and with the quality results the project sponsor expects. • Anyone can raise a risk. © ABB Group 9AKK105151D0119 15 July 2010, Slide 16 • Avoids "fire fighting.” Risk Management - Example  If any risks are predicted in planning, they need to be addressed  Mitigation tasks are necessary Risk Consequence To describe the risk To describe possible consequences Impact/ Cost Probability High /Medium /Low High /Medium /Low Mitigation Mitigation plan 1 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 Add the mitigation to the task list Q3 Q3 Q3 Q3 Q3 Q3 Q4 Q4 Q4 © ABB Group 9AKK105151D0119 15 July 2010, Slide 17 Task Name Estimated Time Resource Identify raw materials that safety stock is needed 3 days Ada Review demand variation in last 6 months for each type of material 5 days Mike Review supplier performance in last 6 months for each type of material 5 days Ron Calculate the ideal safety stock level for each type of material 2 days Ada Build the safety stock 10 days Ada Track the actual consumption on safety stock for 1 month 30 days Ada Modify the safety stock level according to the actual consumption 3 days Ada Retrieve the latest sales forecast from sales, and highlight large volume orders Every Fri afternoon Mike Share sales forecast of large volume orders with suppliers and request them to Every Mon morning Ada be prepared