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As per the PMBOK, the Estimate Activity Resource process has the following inputs, tool & techniques, and outputs:

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Many of us may have been assigned to work on a project without fully knowing the project’s background, or the full nature of the problem the project is intended to address. This is often because during project initiation (the project phase in which we analyze whether a project is necessary), the project team and even the project manager hasn’t been identified yet. We’ll look at some of the stakeholders that are involved in the initiation phase a bit later, but it’s common for most project team members to join a project after the approval (initiation) phase is complete.

Understanding why a project exists, however, and how it fits with larger organizational objectives is the strongest way to unify a project team behind bigger- than-just-this-project goals. All members of a project team should have the benefit of fully knowing the big picture, which is why we’ll examine what “project initiation” documents should contain in this class. If project team members can’t be present for the initiation process, as a project manager we can at least develop and provide our team with a process summary.

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Inputs: Schedule Management plan – the schedule management plan contains details on schedule management guidelines, policies, procedures, methods, tools, etc.., as well as the level of accuracy and the units of measure that may be used to estimate activity resources Activity List – This list will identify activities that will be evaluated for resource requirements Activity Attributes – Attributes give additional details of the activities to assist with identifying resource requirement Resource Calendars – These calendars show when and how long resources (such as materials, equipment, manpower, and supplies) will potentially be available during the project life cycle, Resource calendars may consider attributes such as experience, skill level, expertise, capabilities, geographical locations, and other factors necessary for human resources to identify the best resources and their availability. Risk Register – The risk register contains the list of identified risks and their probability, impact, priority, and response plan. Resource selection and availability may be impacted by these various risk events in the project. Activity Cost Estimates – Resource selection criteria such as number, type, experience, and expertise are based on the cost of the resources.

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Tools & Techniques: Expert Judgment – Any individual or group with relevant experience in relevant experience in resource planning and estimating can bring insight into resource requirements of the activities. Alternative Analysis – There can be several approaches to perform the same task, and the project team should spend time exploring the alternatives to identify the best one for the project whenever possible. Actions such as purchasing an off-the-shelf software components instead of building it, outsourcing a critical activity, adapting a new creative approach to complete a task, using various types and levels of expertise, using different sizes and types of equipment, or using different types of automated tools can be examples of alternatives. Publishing Estimating Data – there are extensive, quality, up-to-date data on production rates and unit costs of resources available through well-known, recognized sources that can help in estimating resource requirements. Bottom – up Estimating – if the resource requirements for an activity cannot be estimated due to the complex nature of the activity, then this activity can be further broken down into smaller pieces of work until the resources can be estimated for these pieces and later summed up from the bottom back up to an activity level.

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Outputs: Activity Resource Requirements: Resource requirements such as resource types and quantities for each activity in the work package are the key outputs. In order to determine the requirements for the work packages, all of the requirements for the activities under that package can be aggregated. The resource requirements documentation should contain the basis of estimates, the decision – making process used to arrive at the estimates, and the assumptions, availability, and quantity for the activities. Resource Breakdown Structure – A RBS is a graphical and hierarchical structure of the identified resources arranged by resource category (such as labor, material, equipment, and supplies) and type (such as expertise level, grade, and experience).

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As per the PMBOK, the Estimate Activity Duration process has the following inputs, tools & techniques, and outputs:

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The estimate Costs process is focused on the development of an approximation of the costs of all resources such as labor, materials, equipment, services, facilities, and any other special items associated to each schedule activity. In order to achieve optimal cost for the project, different options such as sharing on resources, buy versus lease, or make versus buy should be considered. Cost estimates are predicated based on the available information at a given point of time and should be reevaluated and refined as cost-associated risk, alternatives, cost trade-off, and other factors are identified and more details become available. The accuracy of the cost estimates will gradually improve as the project progresses. For example, in the initial phase, a project may have a rough order of estimate in the range of -25 percent to +75 percent, but later on, the budget and definitive estimates will narrow the range of accuracy. Some organizations have more specific guidelines on expected degrees of confidence and accuracy in estimation and when and how cost estimate refinement should be done in the project. However, for the most part, the following three estimates are used for cost estimations: Definitive (-5 percent to +10 percent): Used for bids, contract changes, legal claims, and permit approvals. Budget Estimates (- 10 percent to +25 percent): Prepared from flow sheets and used to establish funds required and to obtain approval for the project Rough Order of Magnitude (-25 percent to +75 percent): It is an approximate estimate made without detailed data. This type of estimate is used during the formative stages for initial evaluation of a project’s feasibility.

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As per the PMBOK, the Estimate Costs process has the following inputs, tools & techniques, and outputs:

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Inputs: Cost Management Plan – The project cost management plan is a component of the overall project management plan, and it defines how the project cost will be plan, managed, expended, and controlled throughout the project life cycle. It also defines the degree of confidence and accuracy expected in cost estimation and methods that will be used to estimate project activity cost. Human Resource Plan: project staffing attributes, personal rates, and related rewards and recognitions found in the human resource management plan are essential components for developing the project cost estimates. Scope Baseline: Scope baseline consists of the scope statement, the WBS, and the WBS dictionary. Additional information on contractual and legal implications with property rights, licenses, permits, safety, security, performance, insurance, intellectual property, and the environment should be considered when estimating cost.

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Outputs: Activity Cost Estimates: Cost estimates address the cost of each schedule activity on the project considering all relevant cost items such as labor, materials, equipment, services, facilities, interest charges, currency exchange rate, contingency reserves, inflation allowance, and administrative items, among other items. The estimate is expressed in units of currency and usually gets refined during planning. Basis of Estimates: A clear and detailed description of cost estimation may include the following; A description of the work estimated (reference the WBS) Explanation of the estimation development process Documentation on known constraints and assumptions made Indication of the range of results (+/-5 percent, $10k+/-$5k, etc.)

At the end of this module, remember that: Estimate Activity Durations is performed after the Define Activities and at or around the same time as Estimate Activity Resources Estimate Activity Durations produces the activity duration estimates and Several estimating techniques are involved with this process. For more precision, estimate costs from the activity level and roll up to the project level The quality of the estimate depends on the quality of the scope definition through activity planning and processes Multiple ranges of estimate accuracy may come into play during the life of the project The project will cost what the project will cost; estimating allows for proper funding preparation.

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1

2

3

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As per the PMBOK, the Estimate Activity Resource process has the following inputs, tool & techniques, and outputs:

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Many of us may have been assigned to work on a project without fully knowing the project’s background, or the full nature of the problem the project is intended to address. This is often because during project initiation (the project phase in which we analyze whether a project is necessary), the project team and even the project manager hasn’t been identified yet. We’ll look at some of the stakeholders that are involved in the initiation phase a bit later, but it’s common for most project team members to join a project after the approval (initiation) phase is complete.

Understanding why a project exists, however, and how it fits with larger organizational objectives is the strongest way to unify a project team behind bigger- than-just-this-project goals. All members of a project team should have the benefit of fully knowing the big picture, which is why we’ll examine what “project initiation” documents should contain in this class. If project team members can’t be present for the initiation process, as a project manager we can at least develop and provide our team with a process summary.

6

7

Inputs: Schedule Management plan – the schedule management plan contains details on schedule management guidelines, policies, procedures, methods, tools, etc.., as well as the level of accuracy and the units of measure that may be used to estimate activity resources Activity List – This list will identify activities that will be evaluated for resource requirements Activity Attributes – Attributes give additional details of the activities to assist with identifying resource requirement Resource Calendars – These calendars show when and how long resources (such as materials, equipment, manpower, and supplies) will potentially be available during the project life cycle, Resource calendars may consider attributes such as experience, skill level, expertise, capabilities, geographical locations, and other factors necessary for human resources to identify the best resources and their availability. Risk Register – The risk register contains the list of identified risks and their probability, impact, priority, and response plan. Resource selection and availability may be impacted by these various risk events in the project. Activity Cost Estimates – Resource selection criteria such as number, type, experience, and expertise are based on the cost of the resources.

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Tools & Techniques: Expert Judgment – Any individual or group with relevant experience in relevant experience in resource planning and estimating can bring insight into resource requirements of the activities. Alternative Analysis – There can be several approaches to perform the same task, and the project team should spend time exploring the alternatives to identify the best one for the project whenever possible. Actions such as purchasing an off-the-shelf software components instead of building it, outsourcing a critical activity, adapting a new creative approach to complete a task, using various types and levels of expertise, using different sizes and types of equipment, or using different types of automated tools can be examples of alternatives. Publishing Estimating Data – there are extensive, quality, up-to-date data on production rates and unit costs of resources available through well-known, recognized sources that can help in estimating resource requirements. Bottom – up Estimating – if the resource requirements for an activity cannot be estimated due to the complex nature of the activity, then this activity can be further broken down into smaller pieces of work until the resources can be estimated for these pieces and later summed up from the bottom back up to an activity level.

9

10

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Outputs: Activity Resource Requirements: Resource requirements such as resource types and quantities for each activity in the work package are the key outputs. In order to determine the requirements for the work packages, all of the requirements for the activities under that package can be aggregated. The resource requirements documentation should contain the basis of estimates, the decision – making process used to arrive at the estimates, and the assumptions, availability, and quantity for the activities. Resource Breakdown Structure – A RBS is a graphical and hierarchical structure of the identified resources arranged by resource category (such as labor, material, equipment, and supplies) and type (such as expertise level, grade, and experience).

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As per the PMBOK, the Estimate Activity Duration process has the following inputs, tools & techniques, and outputs:

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19

20

21

22

23

24

25

26

27

28

29

30

31

The estimate Costs process is focused on the development of an approximation of the costs of all resources such as labor, materials, equipment, services, facilities, and any other special items associated to each schedule activity. In order to achieve optimal cost for the project, different options such as sharing on resources, buy versus lease, or make versus buy should be considered. Cost estimates are predicated based on the available information at a given point of time and should be reevaluated and refined as cost-associated risk, alternatives, cost trade-off, and other factors are identified and more details become available. The accuracy of the cost estimates will gradually improve as the project progresses. For example, in the initial phase, a project may have a rough order of estimate in the range of -25 percent to +75 percent, but later on, the budget and definitive estimates will narrow the range of accuracy. Some organizations have more specific guidelines on expected degrees of confidence and accuracy in estimation and when and how cost estimate refinement should be done in the project. However, for the most part, the following three estimates are used for cost estimations: Definitive (-5 percent to +10 percent): Used for bids, contract changes, legal claims, and permit approvals. Budget Estimates (- 10 percent to +25 percent): Prepared from flow sheets and used to establish funds required and to obtain approval for the project Rough Order of Magnitude (-25 percent to +75 percent): It is an approximate estimate made without detailed data. This type of estimate is used during the formative stages for initial evaluation of a project’s feasibility.

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As per the PMBOK, the Estimate Costs process has the following inputs, tools & techniques, and outputs:

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34

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Inputs: Cost Management Plan – The project cost management plan is a component of the overall project management plan, and it defines how the project cost will be plan, managed, expended, and controlled throughout the project life cycle. It also defines the degree of confidence and accuracy expected in cost estimation and methods that will be used to estimate project activity cost. Human Resource Plan: project staffing attributes, personal rates, and related rewards and recognitions found in the human resource management plan are essential components for developing the project cost estimates. Scope Baseline: Scope baseline consists of the scope statement, the WBS, and the WBS dictionary. Additional information on contractual and legal implications with property rights, licenses, permits, safety, security, performance, insurance, intellectual property, and the environment should be considered when estimating cost.

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Outputs: Activity Cost Estimates: Cost estimates address the cost of each schedule activity on the project considering all relevant cost items such as labor, materials, equipment, services, facilities, interest charges, currency exchange rate, contingency reserves, inflation allowance, and administrative items, among other items. The estimate is expressed in units of currency and usually gets refined during planning. Basis of Estimates: A clear and detailed description of cost estimation may include the following; A description of the work estimated (reference the WBS) Explanation of the estimation development process Documentation on known constraints and assumptions made Indication of the range of results (+/-5 percent, $10k+/-$5k, etc.)

At the end of this module, remember that: Estimate Activity Durations is performed after the Define Activities and at or around the same time as Estimate Activity Resources Estimate Activity Durations produces the activity duration estimates and Several estimating techniques are involved with this process. For more precision, estimate costs from the activity level and roll up to the project level The quality of the estimate depends on the quality of the scope definition through activity planning and processes Multiple ranges of estimate accuracy may come into play during the life of the project The project will cost what the project will cost; estimating allows for proper funding preparation.

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