SPM Glossary

| To Home Page of Project FKD | To English Top Page |

Project Management Glossary

Glossary Contract Schedule Cost Risk Quality Safety Changes Manager Profile Link

Project Mat Glossary

Description and Supplementary Explanation

sequence of tasks has a beginning and an end. (2) Resources such as manpower, time, money and facility are used.(3) A final goal is clearly defined. (4) The goal is achieved under a planned and schematic approach.(5) The tasks are executed by a team. A project is unique and there does not exist the same one. A daily work repeated everyday or regularly is not called a project.

A construction project has four components

traditionally consisting of schedule, cost, quality and safety. Recently concept on scope, risk,

communication, organization, project integration etc. is included.

Project Management Construction

Management

Project management is a managing method to carry out a series of unique and risky tasks by a determined date under limited resources and budget. A project owner makes a general project management, but sometimes he asks a PM company almost or part of his jobs. Sometimes construction management is assigned to a CM company though a constructing work is directly ordered to a construction company. Property management is another word to manage personal or private properties and assets. Facility management deals with facilities.

Plant Construction Contract

according to the payment form, into (1) Fixed price, (2) Cost plus Fee, and (3) Unit price. In accordance with the contract form, project organization and management style are established. On the other hand, equipment and materials purchase contracts and construction contracts are awarded to

manufacturers and subcontractors. Basic conditions of these purchase and construction contacts shall conform to the main contract with the client.

Project Management Body of Knowledge PMBOK

Project Management Institute, USA, describes knowledge and practice as PMBOK required for

project management area in addition to those required for general management area and speciality area. PMBOK covers integration, scope, time, cost, quality, human resource, communications, risk and

procurement for a project. The PMP qualification is required to understand PMBOK.

Project Management Professional (PMP) Project & Program Management (P2M)

PMP is a worldwide qualification certified by PMI, based on the knowledge of PMBOK 2000. As of Aug. 2003, about 68,000 are registered in the world and about 3,000 in Japan. 60% of examinees pass the tests. Details of PMP examination and samples of questions are shown on PMI page.

P2M is a new certification defined by ENAA (Japan Engineering Advancement Association). The first test was carried out in Aug. 2002. The details are

introduced on ENAA page.

Feasibility Study (FS) Planning projects are evaluated whether they should be carried out or not. Evaluating items are, for

pattern. Expenses or manpower of a project has a typical S pattern. A plant construction project is

broken into four phases, conceptualization (initiation), planning, executing with controlling, and closing. Project Phases 1. The initiation phase involves preparation of a

project charter, defining expectation of the client, 2. The planning phase involves a baseline of a project, defining tasks and activities, and developing workable budget and schedule. 3. The executing phase

involves leading project team members to get the work done as planned, including controlling. 4. The closing phase is to review the project and issue a final report.

Project Management Process

According to PMBOK, each phase of a project is systematically executed with five processes consisting of initiation, planning, execution, controlling and

closing. Project

Management Principle

In order to complete a project on time, within

budget and according to expectation of a client, the following 10 rules shall be abided by. (1) Consensus on the project goal and scope shall be established. (2) The best  project team shall be built.(3) The best project plan shall be developed and always kept up-to-date. (4) Sufficient resources shall be prepared. (5) A realistic schedule shall be developed. (6)

Importance shall be put on personnel. (7) Formal and ongoing supports from a client and related divisions shall be obtained. (8) Communications with a

client and related people shall be closely kept.(9) Changes shall be willingly accepted, and, (10) New methods, tools and technologies shall be introduced as necessary.

Project Resources Resources available in a project are normally

of resources.

Project Mission (Charter) The mission or charter is issued by the top or a division manager at commencing a project to authorize the project and nominate the project manager. It also clarifies the project objectives and supports from the top management. In 1970s' TV program, Mission Impossible, a team leader played by Peter Graves received a cassette tape saying "This tape will self-destruct in five seconds." The project mission, however, must be kept open and sustained. Project Rule Project rules are worked out by a project manager

and his team members to specify the statement of work such as project target, scope of work, budget and schedule, project organization, the responsibility chart and the communication plan. Standard rules shall be prepared and renewed by a project

administration group. Ｐｒｏｊｅｃｔ Ｍａｎ

ａｇｅｍｅｎｔ Ｏｆｆ ｉｃｅ

A department to support projects carried out in an organization. Ｉｔ accumulates data of past projects and utilizes them for future projects. For example, it prepares project management tools, establishes standard rules, manages and distributes resources, trains project managers and members, and even selects and ranks projects.

Project Organization There are three types of organization to execute a project in an enterprise, (a) functional organization, (b) pure project organization and (c) matrix organization. Project manager's authority is the strongest in (b) and the weakest in (a). For the successful project

organization, 3Cs (Communication, Cooperation and Coordination) are required.

Functional Organization The existing line (functional) organization is used, as it is, to execute a project. A project manager as staff to the line organization can clarify his responsibility. This organization is easily  accepted by the already

Pure Project Organization When several projects are concurrently carried out, this organization is adopted. The product-wise

organization is applied to a project. The responsibility of the project manager is clearly defined, but the project cost tends to increase due to excess resources.

Matrix Organization In actual, this organization is most frequently adopted. A line manager is responsible for his functional

organization and a project manager for the project execution. This organization is flexible to easily correspond to changes and make the enterprise active and vigorous.Each project member, however, has two boss, a line manager and a project manager at the same time, and this sometimes makes him allergic.

Linear Responsibility Chart (LRC)

The power and responsibility of the related management are defined and shown on a chart. Regarding  line managers, a project division manager and a project manager, the chart shows who works out a plan, who approves it, who must be consulted, who must be notified, and who supervises a job. Stakeholder A stakeholder is one affected by the work or the outcome of a project. This word often appears in foreign books. It includes customers, executives, managers of team members, venders, contractors and team members.

Project Manager A leader for a project is a project manager. In addition to common sense on buisness and knowledge on project management, (1) he must be enthusiastic for the project, (2) he can  manage changes and

modifications effectively, (3) he can be tolerant toward ambiguity of organization and members' behavior, (4) he has negotiating skills and can build coalitions among project related people, (5) he must consider a client first and know client's intentions, and (6) he must keep the business aspects in mind.

representative from the functional division, though having two bosses of line and project.

Work Breakdown Structure (WBS)

A project can be broken down into tasks or activities. WBS has a tree diagram according to a required level.  The WBS of the first level in a plant construction is, for example, civil & architectural, mechanical,

electrical, instrumental works and test running. WBS is used for defining members' roles, working out schedules and compiling budgets. The minimum unit of WBS is a task. A task has a duration of one week to ten weeks. Tasks with too short duration are not advised. In actual,  WBS is often practiced without recognizing it.

Activity Task

A minimum element of a project job is called an activity. Some PM software defines each element is a task and a series of same task is an activity. Others say they are synonymous. A task or an activity shows kind of job, including information of duration, cost and resources. A task moves to a next task by way of an event. refer to Network.

Project

Management Information System (PMIS)

This is a management system to be introduced in large scale projects, in which all information is

gathered and controlled according to the progress of the project. The objects contain documents,

schedules, machinery and materials, manpowers, costs, cashflow. This concept shall be taken into account in small projects. Project management software packages which attach importance on schedule and resources are adopted in small and medium scale projects.

Project

Management Software

Risk Management In a project, in particular, like an overseas plant construction, there are delivery accidents, payment troubles and risks due to being executed in an overseas country without experience and supporting system. A plant also has proper risks such as

accidents during construction, machinery defects or contract changes. At a project start, measures shall be taken for each identified risk, taking into

consideration its happening probability and seriousness of effects.

Conflict Management Due to organization and authority at the project

initiation stage and due to schedule, budget, quality in the execution stage, conflicts arise. There are no projects without conflicts. Results of conflicts often end in changes. If a project manaer notices a sign of conflict, he should go there, watch the site, listen the story of the involved and recognize the fact. In accordance with the conflict, he resolves the trouble by means of withdrawing, smoothing, comprpmising, confrontation and forcing. The best result of solution of the problem is win-win, and "after rain comes fair weather".

Project Start Items specified in the contract such as target, scope, work schedule and payment schedule are clearly shown on a chart. Meetings with the client, project related people and project members are held to determine work procedure, communication methods, problem and risk management, and change handling. Project Planning Based on the contract, project members compile

confirmed facility specifications, a workable schedule chart and a workable cost table. Quality and safety shall be also checked. Due to sever business

risks and additions.

Project Execution Execution follows the project plan. Projects contain problems and risks such as quality defects or construction mistakes without exemption. The earlier they are discovered, the less damages to schedule and cost become. The later discovery is made, the worse influence appears. Projects also contain change works. Execution of change works without confirming their accounts, it caused troubles later.

Project Control A project progress status shall be always monitored and compared with the plan. If deviation appears, its effect shall be checked and measures shall be taken. For example, schedule delays, budget surpassing or quality defects can not be avoided, which are beyond the plan. Problems shall be detected earlier, causes confirmed quickly and measures taken right away. It is important to involve the client and the project related people, consult them and negotiate with them in early stage. Introduction of risk management to handle problems is important.

Project Termination A project does not complete even if a plant is accepted by a client. It does not finish until final documents, completion reports, and review and proposal reports are issued. Phaseout or closure is another expression of termination.

Schedule Control In the planning stage, the schedule is worked out in detail employing various project software. Possible shortening idea of schedule shall be included. This schedule will be a baseline plan for project execution. Periodically or at any milestone, it must be checked. Slippage from the baseline or delays shall be

recovered by increase of workers, extension of working hours, change of job order, simultaneous or parallel works, addition of construction machine, introduction of new contractors etc.. These actions, however, affect the construction cost.

task has  predecessor (s) and  successor (s). and it is also called an activity. A network is  configured by linking dependent tasks with arrow line(s). Almost tasks have dependence of FS (Finish to Start). A minimum amount of time by which an activity can be extended is a float or a slack on the network. A starting point of a task or an activity or an  ending point of a task is event.

Program Evaluation and Review Technique (PERT)

Precedence Diagram Method (PDM)

PERT is a typical network generally worked out with computer software, linking the dependency of

activities. The network clearly shows influence of task delay to the project in general.

PDM is a format of PERT, which shows tasks surrounded by rectangles and dependencies with arrows connecting tasks.

Critical Path Method (CPM)

CPM is the longest sequence of activities from

beginning to end in a network and usually a sequence with zero float. At each timing, a current critical path must be recognized by a person in charge to keep a schedule.

Gantt Chart Gantt chart bars represent tasks ,in length,

proportional to their duration on a horizontal time line. A network is expressed in a bar chart, where a float is shown in a dotted line. In small projects and weekly or monthly plans of large projects, schedules are

expressed in bar charts manually written with MS Excel. Floats are not normally shown as they invite work looseness. A gantt chart was firstly used for a shipbuilding job in 1917 by Henry Gantt（an

associate of Frederick Taylor, sceientific management).

Critical Chain Project Management (CCPM, TOCPM)

In order to complete projects on time, CCPM suggests to remove safety from tasks and aggregate it as

"buffers" to be managed by a project manager, and to make resource dependencies for job or multi-project in addition to task dependencies. The concept comes from the Theory of Constraints by Eliyahu M. Goldratt.

The budget shall be revised after inquiring equipment, materials and construction works in due course of engineering. As most of the budget is the equipment cost, manufacturersto be inquired, specifications, number of equipment and layout shall be carefully examined, prior to placing orders, to realize saving. Same consideration shall be made on designing and construction works. After placing orders, cost increase due to changes and additions shall be minimized. Note that cost must be managed together with schedule.

Value Engineering (VE) (Value Analysis VA)

Value is evaluated by an equation of V=F/C (F;

function, C; cost). VE is achieved by a systematic and organized teamwaork, with reduced cost and

increased function. VE is carried out at design, inquiry and work execution stages, among which the design stage has the highest effect. VE or VA was developed by Mr. Larry Miles, 1947 when he was a purchasing officer in GE,

Earned Value

Management System (EVMS)

Earned Value Analysis (EVA)

EVMS is a system to monitor and control an ongoing project with BCWS,ACWPand BCWP. By showing curves of BCWS,ACWPand BCWP to date, the present and future status of the project is recognized. This system was defined in DoD Instruction as

C/SCSC.

Note that in case of payment by a earned value basis only, ACWP is equal to BCWP. Difference between ACWP and BCWP shall be considered when payment is made on a part time basis, which leads to BCWS, ACWP and BCWP control.

Budgeted Cost of Work Scheduled (BCWS) Planned Value

It is called Planned Value too. BCWS is compiled at project start. All costs shall be defined for all tasks. There are two types of expenses, time-base expense and fixed expense. BCWS of an ongoing task is calculated with (budget cost * planned progress), while the planned progress is calculated with(task duration/planned duration).

Actual Cost of Work Performed (ACWP)

Spent Cost working days) is paid. A fixed money is paid to a lfixed price contractor.

Budgeted Cost of Work Performed (BCWP) Earned Value

BCWP or Earned Value is calculated with budget cost * actual progress ratio. A completed task is a progress ratio of 100%. For example, the progress ratio is 40% in case that 20 sheets are completed for a design work of total 50 sheets. The payment will be 120 thousand yen for the work of 300 thousand yen BCWS.

Cost Variance (CV) Cost Performance Index (CPI)

CV=BCWP-ACWP A minus CV means more money is paid than the actual progress.

CPI=BCWP/ACWP The index shows a deviation of project cost.

Schedule Varience (SV) Schedule Performance Index (SPI)

SV=BCWP-BCWS A minus SV means an actual work is less than a budget, or, an actual task is delayed.

SPI =BCWP/BCWS The index shows a deviation of schedule.

Critical Ratio Critical Ratio=SPI*CPI、or CR=(BCWP/BCWS)* (BCWP/ACWP) The project progress can be judged by this ratio. Good for 0.9<CR<1.2, check for

0.8<CR<0.9, and red flag for 1.2<cr<1.3. Budget at Completion

(BAC)

Estimate at Completion (EAC)

BAC is a budget at completion, which was compiled at project start. EAC is an estimated budget at a certain timing during the project execution. Three methods are used to estimate EAC.

ABC Management Accumulated total is calculated in the order of quantity size, and classified into A, B and C. Ａ is from the maximum to 80%, B is from 80% to 95%、Ｃ is from 95% to 100%. Controlling is made in accordance with A, B and C order. This is different from "Activity Based Costing" employed in a trading industry.

methods, standards and timings of inspection for them shall be established. In the construction stage,

mistakes and defects in manufacturing and

constructing take forms and appear, and they shall be discovered without delay.

Safety and Health Management

From the initiation stage, importance shall be put on workers' safety and health. As grave accidents often occur particularly in the construction stage,  safety organizations, workers' education, improvement of working environment, safety facilities, safety equipment and workers' safety behavior shall be noted. Safety at construction sites begins with

housekeeping (neatness, orderliness, cleanliness). It is the employer's responsibility to supply PPE

(Personal Protection Equipment) to workers. SHE means Safety, Health and Environment.

Safety Task Assignment (STA)

Before assigning a worker to any job, his foreman is responsible for giving him STA as well as job

instructions. STA is safety precautions and actions to be taken before proceeding with a task. Each worker must understand and follow his own STA.

Tool Box Meeting (TBM) TBM is a shop floor meeting (beside a tool box) led by a foreman or a supervisor every morning. Greetings, mutual checks of health and PPE, and assignment of today's task are a main item of TBM.

Safety Check 5 Minutes (SC-5)

SC-5 means that every worker checks his workplace for five minutes at the beginning and at the end of the work to make sure that all hazards are properly contained.

Hazards Prediction Training (KYT or HPT)

KYT is a training program to give workers sensibility for hazards prediction. Usually, a simple sketch of working conditions is shown to a group of workers to ask their free opinions on expected hazards. The leader summarizes the most possible hazard and explains the prevention measures. Finally, all members say together the conclusion loudly to memorise it.

Reference：

Project Management by  1.Jack R. Merdith et al, 2.Sunny and Kim Baker, 3.David I. Cleland, 4.Harold Kerzner, 5.Marion E. Hayns, 6.Gary R Herrkens、7.Donna Deeprose Project Planning, Scheduling & Control by  James P. Lewis. The Fast Forward MBA in Project Management by ; Eric Verzuh.

Professional Construction Management by Donard S. Barrie et al. Construction Safety by Jimmie W. Hinze.

|To Top of This Page | To Home Page of Project FKD | To English Top Page | Severity Rate (LISR) 200,000 exposure hours.

LISR = (Days lost)*200,000/(Total exposure hours) Note: based on OSHA index

Recordable Injury/Illness Rate (RIR)

RIR is the rate of recordable injury/illness cases per 200,000 exposure hours.