Activity Resource Estimating

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Lesson 4

• Activity Resource Estimating
• Cost Estimating
• Top-down
• Parametric
• Analogous
• Bottom-up
• Ratio cost
• Ground Rules Assumptions
• READ PMBOK 3rd Ed., 2004, Ch. 6 (pgs 123-151)

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Activity Resource Estimating

• Identify Physical Resources (People, Equipment,
  Materials) and What Quantities of Each Should Be
  Used to Perform Project Activities

• Inputs
• Enterprise Environmental Factors
• Organizational Process Assets
• Activity Lists
• Activity Attributes
• Resource Availability
• Project Management Plan

• Outputs
• Activity Resource Requirements
• Activity Attributes
• Resource Breakdown Structure
• Resource Calendar Updates
• Requested Changes

• Tools and Techniques
• Expert Judgment
• Alternative Analysis
• Published Estimating Data
• Project Management Software
• Bottom-up Estimating

PMBOK, 3rd Ed. PMI, 2004.
3
Inputs to Activity Resource Estimating

• Enterprise Environmental Factors
• Organizational or Company Culture
• Government or Industry Standards
• Infrastructure
• Existing Human resources
• Personnel Administration
• Company Work Authorization System
• Marketplace Conditions
• Stakeholder Risk Tolerances
• Commercial Databases
• Project Management Information Systems

PMBOK, 3rd Ed. PMI, 2004.
4
Inputs to Activity Resource Estimating

• Organizational Process Assets
• Organizational Standard Processes
• Standardized Guidelines (work instructions,
  evaluation criteria, performance measurement)
• Templates (risk, WBS, schedule, cost estimating)
• Communication Requirements
• Project Closure Guidelines or Requirements
• Financial Controls
• Issue and Defect Management Procedures
• Change Control Procedures

PMBOK, 3rd Ed. PMI, 2004.
5
Inputs to Activity Resource Estimating

• Activity Lists
• All schedule activities on the project within
  scope
• Activity Identifier
• Scope of Work Description
• Activity Attributes
• Activity Code
• Predecessor
• Successor
• Logical Relationship
• Leads and Lags
• Resource Requirements
• Constraints
• Assumptions

PMBOK, 3rd Ed. PMI, 2004.
6
Inputs to Activity Resource Estimating

• Resource Availability
• People, Equipment, Material, available for
  project
• By location and project phase
• Project Management Plan
• Aid to project team in developing and controlling
  changes to the Project Management Plan
• Is made up of subsidiary management plans
• Scope, Schedule, Cost, Quality, Process
  Improvement
• Staffing, Communication, Risk Management
• Procurement Management

PMBOK, 3rd Ed. PMI, 2004.
7
Sample Work Breakdown Structure Organized By Phase
PMBOK, 3rd Ed. PMI, 2004, pg. 116
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Sample WBS for Defense Material Items
PMBOK.. PMI, 2000.
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Automobile WBS
10
Tools and Techniques for Activity Resource
Estimating

• Expert Judgment Group or Individual With
  Specialized Knowledge or Training.
• Other Projects Within the Organization
• Consultants
• Professional or Technical Associations
• Industry Groups
• Alternative Analysis
• Make-or-Buy Decision
• Faster Machinery
• Published Estimating Data (Commercial Databases,
  Industry Assoc.)
• Project Management Software
• Bottom-up Estimating

PMBOK, 3rd Ed. PMI, 2004.
11
Sample Resource Needed Worksheet
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Outputs from Activity Resource Estimating

• Activity Resource Requirements
• Description of the Type and Quantity of Resources
  Needed for Each Schedule activity in a Work
  Package
• Requirements may be aggregated to determine the
  estimated resources for each work package
• Activity Attributes (Updates)
• Types and quantities of resources required for
  each schedule activity
• Activity List and Attributes to be updated for
  all approved change requests

PMBOK, 3rd Ed. PMI, 2004.
13
Outputs from Activity Resource Estimating

• Resource Breakdown Structure
• A hierarchical structure of identified resources
  by category and type
• Resource Calendar (Updates)
• Standard calendar of work days, holidays, and
  normal business hours
• Project resource calendar identifies the
  availability for resources on specific dates
• Requested Changes
• Requested changes identified in the Activity
  Resource Estimating process
• Processed through the Integrated Change Control
  Process

PMBOK, 3rd Ed. PMI, 2004.
14
Resource Histogram
PMBOK. PMI, 2000.
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Applications in Resource Planning

• Allegheny Ludlum
• Research and Engineering Resource Allocation
• How Does a Firm Plan For Resources?
• Harvard Business Case
• This is good reference material
• for your class project

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Case Questions

• What Were Alleghenys Businesses?
• What Were Management Considering?
• Were Staffing Changes Needed to Support
  Managements Considerations?
• What Resources if Anything Should Changed?
• What Would be Considered Alternatives

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Resource Estimating Considerations

• Scope Statement
• WBS
• Resource Constraints
• Experts and Alternatives
• Resources
• Internal or External
• Staff or Procurement

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Exercise in Resource Planning

• Determine Resources Needed for a landscaping
  project
• Note Should Include Material and Labor

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Prepare for Lesson 5

• Introduction to Project Cost Management
• Key Concepts of Cost Estimating
• Estimating Fundamentals
• Inputs, Tools Techniques, Outputs
• Reserves
• Accuracy
• Learning Curve
• Types of Cost
• READ PMBOK 3rd Ed, 2004, Ch 6 (pgs 157 167)