EPM EV43004FP C2-part 2.pdf

5 Monetary (budgetary) management and the relevance of it in a project What is Budget Management? Budget management is the overseeing of revenue and expenditure tracking in a project. Managing a budget involves analysing potential income and spending, organising purchases by category, and m...

5 Monetary (budgetary) management and the relevance of it in a project What is Budget Management? Budget management is the overseeing of revenue and expenditure tracking in a project. Managing a budget involves analysing potential income and spending, organising purchases by category, and monitoring cash flow over time. Is Budget Management relevant in Project Management? The project management budget is what decides the resources available for each task. Since all project milestones are interwoven, their budgets are also interdependent. If the budget for any task exceeds, it will affect the resources available for other tasks. The core responsibility of a project manager is the successful execution of a project, within the estimated budget, time and quality standards. These three factors: budget, time and quality, constitute the back bone of every single project. But, though time and quality might be of equal importance in the life cycle of a project, nothing can move forward without the necessary amount of money and that requires a well-planned and properly estimated budget. Source: projectsmart.co.uk 6 Project deliverables under the Work Breakdown Structure (WBS) Event managers can help to visualise organisational structures and roles by using a Work Breakdown Structure. This is an example of the connectivity between project management and events organisation. Work Breakdown Structure (WBS) A work breakdown structure (WBS) is a project management tool that takes a step-by- step approach to complete large projects with several moving pieces. By breaking down the project into smaller components, it becomes easier for teams to identify scope, cost and deliverables and delegate tasks to the team members who are best suited for the job. 39  WBS can be presented in two forms: a. Graphical Form b. Outline Form A. Graphical Form A graphical WBS looks like a hierarchical structure where the big chunk of tasks is listed in Level 2 and the tasks below this big chunk will be listed in Level 3. Level 1 Level 2 Level 3 Source: Free Mind Map Template: Work Breakdown Structure (WBS) of Event Planning. (2024). Visual-Paradigm.com. https://board.visual-paradigm.com/pt/templates/work-breakdown-structure-wbs-of-event-planning In a general project in event planning shown in the WBS above, the project can be broken down to various levels. To simplify it for this lesson, we have shown two levels of breakdown, however, for a real-life project, the break down can go beyond 3 levels depending on the complexity of the project (event): x Level 1: The top level represents the entire project or final deliverable. x Level 2: This level breaks down the project into major components, phases, or deliverables. x Level 3 and Beyond: Further break each major component into smaller tasks until the work is defined to a level where it can be easily assigned, executed, and controlled.  What are tasks? The smallest unit in a WBS is a task. It is a well-defined piece of work that can be scheduled, assigned, and tracked. Each task should have a clear output or deliverable  What are deliverables? Each element of the WBS should result in a deliverable, whether it's a product, service, or documentation. 40 Here is an example of how you can apply it to the following project – A company holiday party. Please refer to Annex 2 for more examples. Level 1 Level 2 Level 3 Organ, C., & Bottorff, C. (2024, May 28). Work breakdown structure as A project management tool (R. Watts, Ed.). Forbes Advisor. https://www.forbes.com/advisor/business/what-is-work-breakdown-structure/ 41 B. Outline Form The WBS can also be presented in an outline format which looks like a list of tasks. Based on the example of a company holiday above, you can create the same WBS in Outline Form like the following: Company Holiday Party Level 1 1. Initiation Level 2 1.1 Choose party date/ time 1.2 Decide food/ beverages 1.3 Decide on party activities Level 3 1.4 Cost estimation 1.5 Create party invites 2. Preparation Level 2 2.1 Send invites 2.2 Acquire food/ beverages Level 3 2.3 Book venue 2.4 Create party playlist 3. Execution Level 2 3.1 Arrive at venue for set up 3.2 Welcome guests Level 3 3.3 Enjoy party 3.4 Clean up after party 4. Follow-up Level 2 4.1 Thank guests for coming Level 3 4.2 Follow up survey 4.3 Discuss improvements for next year 42 Benefits of Using a WBS a. Improved Project Planning: provides a detailed roadmap of the project, helping project managers plan resources, timelines, and budgets effectively. b. Enhanced Communication: by clearly defining the scope and deliverables, it ensures that all stakeholders have a shared understanding of what the project entails. c. Better Risk Management: breaking the project into smaller tasks allows for more precise identification and management of risks associated with each component. d. Effective Monitoring and Control: serves as a baseline for monitoring progress. By tracking the completion of work packages, project managers can measure performance and adjust as needed.\ e. Accountability and Responsibility assigns responsibility for each work package, ensuring that team members understand their roles and responsibilities within the project. Continuously review and refine the WBS as the project evolves to ensure it remains aligned with project objectives and scope. x A project vision statement. x Defined project phases that depend on the project size. x A list of tasks with deliverables. 43 Source: forbes.com