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3.5 THE PROJECT PLAN


This section describes the contents of a prolcct plan. Althor-rgh a particLrlar structtrre
is describecl \roll are not expectccl to use it rigidly. It is intencled to describe the
issuers that tnttst be acldressecl in the plan rather than the way that the plan shotrlcl bc
orgrl nizecl.

3.5.1

Preparing the project plan

In all br"rt the srnallest projects the project manager should prepare a fttmral set

<>f

document.s called the project plan. Llsually key members of the prospective proiect
team n'ill help in the preparation. The purpose of this set of docurnents i.s t()
colnmunicate the project manager's intentkrns to its various readcrs.

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higher m:lnagement in the contracting <trganization


the ciient
members of the prolect team.

As the proiect plan has these three distinct readersl'rips there may be sorne parts of it
n4rich are specific to certain people, such as c<lnficiential secticlns firr managerlent,
but v''e will ignore these minor differences between versions here.

The project plan is usually developed in at least tw() stages and passes througl-r
several drafts as it evolves. Before the project is sancti<tncd by tlte client the plan is
initially required in outline form to gain the sup[)()rt of senior rranagement and tcr
establish the client's confidence. (Initial clrafts rnay be used firr consr-rltation.) \Where
a client invites bids the quality of the plans prcsentecl by bicldcrs will often be an
important factor in the client's decision on whorn to appoint. Afier the project ha.s
been sanctioned tnore detail may be aclclecl tcl the plan as decisions are taken and
uncertainties resolved, so that an initial version can be used as a s()urce of guidance
to the rnclnhers of tlre pr()iect te:rnl.
During the project the plan should be regularly updated to reflecr developmenrs

which were either unfcrreseen at tl-re launch r>r for whicl-r insufficient informatir>n
was available or which were simply too far ahead to be w<trth planning in detail.

3.5.2 Contents of the project plan


vhile virtually everyone will agree that there shoulcl be a projcct plan, not everyone
will agree on precisely how it should be laicl out and exactly what it should contain.
There are no rules about this. Nevertheless, there are certain topics that form the
core of what most proiect manalers would put in a project plan: tl'rese- are listecl
below.
Overview ()r sulnlnary
2

Project scope and contract

Technical plan
Quality and management

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5
6

Or gantzation and persclnnel

7
8

Resourcres

Project sc-l-redule

and facilities (including buclget t>retrkcltlwn)

Risk assessmcnt and risk lllttnllgetnent

content of each of these eight sections is cctnsicletrecl in lll()re cletuil belorv. Tl-re
relationship betn.een the r,'ari<tus docuntents in tl-re plan is .shrlwn in Figttrc i 32

The

business oblecttves
clrent's obtectives

prolect proposal
prolect oblectives

project definition
c)
G

PROJECT PLAN

responsibility matrix

wpl
wp2
wp3

work package
definitions
res0urces
schedules

materials
requirement
schedule

-c
(J

=
E
3
()

network

-c

wp1

wp2
wp3

The project plan and its components (courtesy Roy Shepherd)

estimates
and cost
plan and
other plans

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Overview or summary
The overview or summary should cover all the essentials in brief. It is a useful
introduction to help people reading the plan discern the plan's main structure before
examining all the particulars. Some people call this an executiue summary, based on
tl-re notion that a busy executive at the top level will want to spend only a few
minutes getting a feel for the project rather than studying all the details. The main
points to be summaized are:

the project's objectives, including the top level of the work breakdown
structure

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a

the organization of the proiect team


the schedule of work, especially key milestones
resources required, including the budget
an assessment of significant risks.

All these points receive detailed attention in the body of the plan.

Project scope and contract


This section describes in detail the oblectives of the project together with
fustifrcation for undertaking it. It should include:
o reasons for undertaking the proiect at this time

o
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.
.

what is to be achieved (requirements and main deliverables)


the work breakdown strLlcture (higher levels)

the limits on time and costs


the assumptions that have been made in drawing up the plan
the quality criteria by which the success of the proiect will be judged.

is to be achieved it is sensible to state explicitly an)'thing


excludedfrom the project that some parties involved might otherwise have expected
to be included. During the discussions while a plan is being formulated it is likely

\fhen describing what

that a number of options will be proposed. Not everyone will be clear about the
status of these options if they have been abandoned or deferred. Stating clear
limitations on the scope of the present project will avoid later disappointment and

recriminations.
There may be other aspects of the contract that need to be highlighted. For example,
it may have been specified that the work uses particular equipment or named
subcontractors and that certain standards are to be adhered to. These contractual
aspects should be referred to in the project plan.

Technical plan
The technical plan covers the main technical features of the proiect. There are
usually references to requirements, specifications, system diagrams, site plans, tools,
techniques, support functions, standards and other documents according to the
nature of the project being undertaken. The level of detailed design required should
also be specified: for example, whether it is proposed to purchase or subcontract
large modules or to undertake detailed design in-house.

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Quality and management


This

part of the plan addresses the issue of how the project is to be managed to

the quality expected by the client and the contractor. It will describe, for
example, the systems to be used for accounting, authorizing work, change control,
the use of configuration management, liaison with the client, reporting and review
procedures and safery. (Some of the systems and standards to be employed may be
specified in the contract.) A standard methodology such as PRINCE may be specified
achieve

for

the project work.

organizations prepare a separate plan, called the quality plan, which gathers
together in a single document all the activities that are deemed to relate specifically
to maintaining the quality of the project, as opposed to tl-rose activities essential to
project performance. These quality activities concentrate particularly on the
maintenance of standards and the testing of deliverables against those standards.
(Here we will assume that in the same way that quality is to be built into the proiect,
so the qualiry activities will be part of the proiect plans, but they could be contained
in a separate document.)
Some

form that quality planning takes will depend to a large extent on the quality
environment in the contractor's organization. In an organizatioo which has already
developed quality procedures for performing projects the existing quality tnanual
will already lay down the way in which the proiect is to be managed. The quality
manual, for example, defines what is to be contained in the proiect plan itself! The
quality document will be devoted to considering whether any of those procedures
are not applicable to the current proiect or need modification.
The

Inanorganization where there is no quality manual or if the quality manual does


not cover projects then the quality section of the project plan will be much longer
because it must show how quality will be assured. It needs to cover such issues as:

how quality criteria will be set for assessing the adequacy of each piece of

work

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what measures will be taken to prevent the occurrence of faults


what will be done to detect and correct the faults that do occur
what tests will be used to demonstrate whether the quality criteria have
been met

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what review procedures will be used


who will perform the quality control work.

Organization and personnel


In Section 3.2

we considered how the project organization might be set up and

responsibilities assigned. This section of the plan, the organization plan,


communicates the results of that work to everyone involved.
The organization plan describes the structure of the project team and the
responsibilities of the various people involved in the profect. This will include not
only the contractor's but also any subcontractor's staff and staff from the client's
organization who will have an input to the project. The plan should include an
organization chart. If key personnel, such as work-package managers, have already
been earmarked for the project their names may be given. If names are not given it
is necessary to identify people according to the skills required (for example, 'tl-re
project requires three electrical engineers of whom at lea.st one is experienced in

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designing higl'r-speed clrive systems'). If the pcoplc arc n()t namecl thcn it is als<t
appropriate to sav whe-re they will corne fi<>m, hon'they rvill be recrllitecl, $'hat
training thev l'ill require, ancl $'hen they will be needed.

Project schedule
This section descriltcs tl're schech-rlc of thc project in the fortns that yclr.t havc' sttrcliccl
in detail in Scclions 3.J anci 3.+. It shor.rlcl describe tl'rc main pha.scs of the pr<lject
rrncl highlight all tl"re key milestoncs. tlsually Gantt charts are ttscd in prc.senting
pl:rns such a.s this because n()n-experts find them easy t() u.se, ltut netw()rks are als<r
appropriate if thc auclience is likely t() Llnderstand thern. The use of activity-<tnarr()\\' ()r activity-()n-noclc $.'ill usually depend n()t ()n the relutivc merits <tf the
techniclues but on their fhmiliarity t<l the ttsers of tlte plan.

Resources and facilities


Tl-ris section of tl-re plan surnrnarizes the resources ancl facilitics reclttirecl in the

project, incltrcling m()ney, people and services. The recluirernc'nt.s for these resources
sl-roulcl sholn' not <tnly tl-re t()tal resollrce reqr-rired but also the clistributi<tn of the
requirement over tirne. For example, the total project buclgct r-uay be.t1 million br-rt
that surn is n<X reqr.rired at the .start c>f the pnrject. The' financial planners will r"'ant t<r
knon-the requirements fcrr cash, prr>bably in monthly or quarterly perir>ds, s() that
tl're cesh can be rnade available at tl-re right tirne. (Provision of cash unnecessarily
earlv cc>sts rnoney.)
Ant>ther subject that may be acldressecl in tl'ris section of the plan is the casl'r flol,'
plan. Given a schedule for the work and estilnates of the cost of cach clernent it is
possible to calculate the cumulative cash outflorv arising fion'r the vn'ork. It is normal
in a project of .some size for the client t() pay the c()ntract()r at stages th(rughor-rt the
pnrject. These stage payments are usually agreecl to bc clue at milcstones,

rcpresenting tl-re cornpletion of recognizable portions of thc project. Hence it is


possible t<t calculate cash inflow to the contract()r fr()ln tl're schcdule of clates
planned for these payment milestones togetl'rer rvith tl-re am()Llnt agreecl ftrr each <tf
the stages. Combining the estimates for cash outfkrw and casl-r inflrllv yields the
planned cash flow for the contract()r.
Sin-rilarly, requirernents for people ancl services should be accompaniccl bv the clates
u'hen they are needed. While it is natural that e pr()iect man:lger \\'ants t() ensure
tl-rat staff are avaiiable early enough, it is expensive to recruit peoplc int() a team at
tl-re beginning of the prclject, only to find thcr.n n'aiting t() start work that can't be
done tintil later in tl're prcject, for example people recruitccl frrr installation rvork
n'hen the eqr"ripment has still to be procr.rred. (This is an exarnple of balancing the
cost of having people iclle against the risk that they q'ill not be reaclily available at
thc right tirne. )

Risk assessment and risk management


This part of tl're project pian is concerned with risks such as th<>se disctt.ssed in
Chapter 2. It shor,vs how the project manager plans to mnnage tl-re risks sl-ror-rld tl-rey
arise. Today this is recognized as being of crucial imp()rtance. It often ttsecl to be
omitted from project plans, perhaps because of its overtones of pessinrism: mlny
f-elt it drew to<> much attenti()n to the nellative aspects of the projcct. Nevertheless,
fror.n the ooints of vien' of both the c()ntractor ancl the client it is vital to know the

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being run and to be sure that the risks will be under regular sun eillance so that
corective action can be taken at the earliest possible time. The prcparati()n ()f the
dsk management plan is a necessary stimulus to the proiect manager to take
precautions again.st the dangers. (At tl-ris point, many proiect managers aclvocate
setting up a risk register for use in monitclring risks; however, thi.s does not [<rrm part
of the project plan.)
risks

1tber components
The

of tbe plan

plan outlined abclve shr>ws the core c()rrlp()ncnts n4rich are necessary ftrr

almost

all project plans. However, it will often be appropriate to have additional

on matters which do not seem t() fit tidily into this structLlre. In a hazardous
environment you n-right want an entire section dealing rvith .safety nlatter.s and for a
computer system you often need a security plan.
plans

Ve do not present the structure outlined above as a universul formr.tla bltt :rs a
guideline to a minirnal set of t<-rpics which the project plan sl-rrtulcl aclciress.

SAQ 3.29

(a) \7iro should prepare the project plan?


(b) At what stage?
(c) For what readership?

ACTIVITY 3.4
Consider y()ur ()\vn prr>ject ancl take n()tc.s ()n y()ur answers to these qllestions.
'Was there a d<>cument or documents available to the pr()iect team that yotr
can identifv as the ft)rmal plan f<rr the project-/

Are there elernents within the above ciescriotion that vou think were
missing from the plans in your project?
'Why do you think this rnigl-rt have been so? Do you think it would have
been useful if these missing secti()ns hacl been included?
Conversely, were there section.s in your project plan that we have not
tl-rought t() menti()n that you think r.vcluld lrc of benefit in any pr<tiect plan?

ACTIVITY 3.5
Take notes ()n y()ur answers to the ftrll<tu'ing.

In your proiect
project plan?

l'ork

was a quality stanclard ttsed f<tr the prcparati<ln rtf

If there R'as a such a standard, colnpare it s,ith the outline rve have given
above. If nclt. consider whether the intr()duction of a stanclarcl r.vctulcl be
hencficiel

t( )

y()ur organizelion.

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3.5.3 Summary
This section has outlined the requirement for a formal proiect plan, initially to be
prepared by the project manager before the project is sanctioned and subsequently
to be amplified and updated. Versions may be required for senior management, the
client and the project team. The main topics to be addressed in this plan are:

o
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project scope and contract


technical plan
quality and management
organization and personnel
project schedule
resources and facilities (including budget breakdown)

risk assessment and risk management.

Having studied this section you should now be able to:

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i
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\.
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describe the role of the formal proiect plan

prepare such a plan for a project with which you are familiar, using documents
you have developed during the planning and estimating phases of your work.

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