Assignment Pm0010

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Q.1 Explain the following a. Project Vs. Program Vs. Portfolio b. Project work and Traditional functional work A-a) Difference between Project, Program and Portfolio Management Project Management: A project has a definite start and end date with a clearly mentioned deliverable produced and project management is the application of knowledge, skills, tools, techniques and processes to effectively manage a team to achieve this final deliverables, which means the management of a specific project. Pr
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    Q.1 Explain the followinga. Project Vs. Program Vs. Portfoliob. Project work and Traditional functional workA-a)   Difference between Project, Program and Portfolio ManagementProject Management: A project has a definite start and end date with a clearlymentioned deliverable produced and project management is the application ofknowledge, skills, tools, techniques and processes to effectively manage a team toachieve this final deliverables, which means the management of a specific project.Project management focuses on delivering the specific objectives of the project. Program Management: A program is a group of related projects which aremanaged together to obtain specific benefits and which cannot be obtain if theprojects are managed individually. Program management is focused on achievingthe strategic objectives of the integrated project. Portfolio Management: A portfolio is the collection of projects or programs groupedtogether to facilitate effective management of effort to meet strategic businessobjectives and this typically includes identifying, and prioritising projects andprograms to achieve specific strategic business objectives.If you consider projects as the bottom of a hierarchy then programs sit above them inthe middle of the hierarchy and address a related set of projects. This allows theportfolio management level to stand at the top of this hierarchy.b) Differences between Project Work and Traditional Functional Work Project work and traditional functional work differ in many ways. It is important tounderstand these differences.Functional work is routine ongoing work. Each day machine operators, carsalesmen, secretaries, accountants, financial analysts and quality inspectors performfunctional work that is routine, notwithstanding some variations from day to day. Thefunctional worker gets training from a manager assigned to the specific function, andthe manager supervises and manages the worker according to standards ofproductivity and quality set for the particular function.In contrast to functional work, project work is a temporary endeavour undertaken tocreate a unique, non-routine product or service. A project manager manages aspecific project with people and other resources assigned to him only for projectmanagement support on the specific project, and not on an ongoing basis. Theproject manager is responsible for the approved objectives of a project such asbudget, schedule and specifications. Project terms are typically not organised in thesame hierarchical structure as that of functional group.  Q.2 Compare Operation and project procurement. Also list and explain theproject procurement process.ANS - The differences between the procurement carried out for the overall operationof an organisation, and the procurement carried out for a specific project, are shownbelow  Project Procurement Management Process The project procurement method varies depending on the category of the contractedproduct or service. The broad categories are:  Materials or products  Equipment or tools  Labours  Professional services  Totally engineered systems  Total project  Project Procurement Management generally involves the following:    Deciding to „Make or Buy‟    Outsourcing the work for a „Buy‟ decision.  Managing risk (although risk management is often addressed separately, itis noteworthy that contracts are, at their core, risk management tools.)All procurement requires some level of planning. The intensity and the effort requiredin planning depend on the complexity of the scope of work in the procurementpackage. For a manufacturing company deciding to starts a project, the „make or buy‟ decision forms the first step in the procurement planning. This decision is based on a cost comparison between „make‟ and „buy‟, and the timely availability of the manufacturing equipment or shop personnel for meeting deliveries without adverselyaffecting their other job orders. Several companies in India exist, wherein; thecompany or a division of the company already manufactures a product, and thecompany is also executing projects for its clients which require the same product as  part of another project scope. The market scenario for the product or service to beprocured gives rise to any of the following three conditions: Sole Source: In this case there is only one qualified seller in the market. Forexample, Dow Chemicals under their patent was the only manufacturer ReverseOsmosis (RO) membranes which was utilised for desalinating saline water and allwater treatment package vendors had to buy RO membranes only from them or theirlicensee in a country. Single Source: This is a case when your organisation prefers to work with anidentified seller, even though other sellers may offer a lower price. Sometimescompanies show a preference for a supplier with a view to create a long termrelationship for a niche product which the company may require to procure often. Oligopoly: This is a condition where the providers of the product or service are sofew in number that the actions and pricing of one seller affect the actions and pricingof the other sellers. Examples of airline fares, oil prices, and hardware prices can fallin this category.The function performed by each process is explained below. Plan Purchases and Acquisition Plan Purchases and Acquisitions is the process for deciding what to buy or acquireand when and how to buy that. It is a process of identifying the risks involved in eachmake or buy decision. It also reviews the type of contract with regard to mitigatingthe risk by determining what risks can be transferred to seller.The outputs of this process are:starting with development of procurement documentation and culminating in contractclosure.which is included in the particular contract). Plan Contracting This process includes preparation of a procurement document for each contractplanned. This document is issued to prospective sellers who are invited to bid. Theinvitation is termed Invitation To Bid (ITB), Request For Quotation (RFQ), tendernotice, Request For Proposal (RFP), invitation for negotiation or contractor initialresponse.ITB and RFQ (both imply the same type of invitation) are focused on getting the seller‟s price, and not his ideas. For example if RFP asks for a price that means in addition, it necessarily asks for th e sellers‟ and ideas on how the project work should be done, which implies that there is a bit of consultancy service demanded from thesellers in their response. Evaluation criteria: The first category of evaluation relates to prequalification of afirm for receiving the ITB. Here, a prior assessment of the capability of a firm toperform the intended scope of work is made. For large value contracts, the ITB ispreceded by an invitation to submit a prequalification offer, in which the seller isasked to submit his experience list for similar works carried out by enumerating thefollowing:work.financial statements like balance sheet, Profit and Loss (P & L) accountfor the last 3 to 5 years.   ment/production machinery owned.This data submitted by all prospective bidders is analysed to arrive at a list of pre-qualified bidders, eligible to receive the ITB/RFP.The second category of evaluation criteria relates to evaluating the bids received inresponse to the ITB/RFP. These may involve price loading criteria for technical andcommercial deviations stipulated by the bidders in their bids, as well as specificcriteria for price loading on utilities. Request Seller Responses While the prospective sellers are expected to submit their bids in response to theITB/RFP as issued to them, it is a common practice in large value contracts to host a bidders‟ conferenc e, where all bidders are present and are permitted to askquestions concerning the SOW. This method is followed to ensure that all bidderspossess the same information on which to base their prices and proposals. Aftersatisfactory completion of this step, a due date for submission of the bid/proposal iscommunicated to all bidders. This process is called solicitation.The output of this process is a bunch of bids proposals from the bidders. The proposals are the seller‟s prepared document that describes the seller‟s ability to provide the requested products/services at his quoted price. Select Sellers This process involves complete evaluation (techno-commercial evaluation and priceevaluation) of the bids received, followed by negotiations with the bidders. Here thebidders have been pre-qualified following a fairly extensive evaluation; the finalselection of the seller is usually based on the lowest evaluated price.The outputs of this process are: The Contract: This can be a simple purchase order or a complex document. A contract is a legal document backed by the country‟s legal system (as long as it does not include illegal activities). Contract Management Plan : This covers contract administration activitiesthrough the life of the contract. Contract Administration Contract administration is a process of managing the contract between buyer andseller. It is also provides:documentation of this performance.ly manage contract related changes. Contract Closure Contract closure is a process of completing the contract by resolving all open items.Sometimes, a contract may be foreclosed or terminated by mutual agreementbetween buyer and seller.
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