ClassNotesModuleC_L7 - Project Lifecycle Project Costing...

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Unformatted text preview: Project Lifecycle Project Costing Module C Project Management Agenda Lifecycle by example Mini-economics introduction Project Lifecycle A project goes through a lifecycle and so must our management of that project The Project Management Institute calls the stages: Initiation Planning Execution Control Closure 1 Project Stages (Model) PM = Project Management PM Initiation Technical Design Technical Execution Technical Closure PM Closure PM Planning PM Control important interactions Project Stages (Reality) Initiation Planning Executing Controlling Closing Activity Level Time Fear not!! Decide at various points** of the project whether to continue possible?? practical?? **Milestones!! [Gateways] 2 Initiation Answers startup questions, for example: What is the project? Who does the project management? To whom do they report? What will be tracked overall? How do we deal with a crisis? (What is a crisis?) Questions Starting a Project What is there now? Has prior work been done? What is the project? What is the project context? What are the deliverables? Do the inspections. Analyze the problems. Document the solutions. Present the results. 3 Project Closure Projects are often improperly closed Gather information from team and organize into one file. Dispose of extraneous data [central filing of relevant material] Perform final project evaluation - schedule, budget, scope, share lessons learned Closure of RDH Project Qu: Why is the closure of this recommendation project important to RDH??? Lifecycle Summary There are identifiable stages in the lifecycle of a project These overlap Each must be recognized and fully addressed for the project to be successful 4 Agenda Lifecycle by example Mini-economics introduction Suppose.... Lee Medical Equipment asks you for a design and prototype. You estimate 83 hours of work. What do you charge??? 87 * $7 because thats what you are getting at MacDonalds - oops add $50 for the parts for one prototype. oops - the soldering equipment costs you $350 - the development system costs you $275 - getting 20 circuit boards is $200 so your $10 estimate for the board was ok but - you forgot shipping taxes, minimum orders - you microphone blows up when u put it in backwards - Costs: Direct / Indirect directly attribute to the project Direct: Labour Consultants Material Travel Services Special equipment Stationery, Long distance 5 Costs: Direct / Indirect Indirect: not direct(not specific project related) Overhead [heating, office staff, sales, legal, accounting] Shared resources [tool area, general inventory] Estimating Direct Costs $=units/productivity*hourly$ $=units*unit rate Experience!! [Have it, find it, purchase it] Estimating Indirect Costs $=total $ * % allocated to project Example: (60000/yr)*(1yr/50weeks)*(15 weeks) * (33% allocation) 6 Overheads Overheads are related to the cost of running a business Calculated as % of direct + indirect costs by management on an annual basis Other Things in the Client Price Profit Warranty costs So you charge... Direct Costs + Portion of Indirect Costs + Percentage Profit + Warranty ???? NO This only is to help you decide whether to take the work at what the client will pay. 7 From the Client Standpoint Your Fee Project Cost Use Save yourself a day and... Order the wrong parts Get an error in a calculation Include an unneeded 5-cent part in a manufactured item Cripple a system with a computer bug Endanger a life your costs must include cost for testing You must consider: Installation costs Training costs Setup costs (ex site preparation) Overheads & other indirect costs Warranty, inspections, follow-up Disposal 8 Summary of Costing Lesson To properly cost a project you must allow for more than just the material used and the hands-on labour 9 ...
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