Budget, Schedule and Resources for Project Management - MGT5PMT

Budget, Schedule and Resources
Subject Code: MGT5PMT
Subject Coordinator: Dr. Siobhan
Asian
Submission Date: 06th April 2018
(18829905)

Table of Contents
Executive Summary............................................................................................................................2
1. Estimate Cost..................................................................................................................................3
1.1 Estimate Cost: Tools and Technique.....................................................................................3
1.1.1 Bottom-up estimation........................................................................................................3
2. Determine Budget.......................................................................................................................3
2.1 Determine Budget: Tools and Techniques............................................................................4
2.1.1 Cost Aggregation..............................................................................................................4
3. Develop Schedule.......................................................................................................................4
3.1 Tools and Techniques: PERT and Critical Path Method.....................................................4
4. Develop Resources....................................................................................................................6
4.1 Tools and Technique: Resource Leveling.............................................................................6
Conclusion/ Remarks.........................................................................................................................0
Reference............................................................................................................................................1

Executive Summary
This report is aimed to determine the budget, schedule and resources for the project. Tools
and techniques used for determining the resources is resource leveling. Tools and
techniques used for determining schedule are PERT and Critical Path Method. Tools and
techniques used for determining budget is bottom-up estimation and cost aggregates. The
assumptions, structure and format of the report follows the PMBOK Guide. The maximum
and minimum number of workers to be scheduled in a day is 17 and 9 respectively. The total
time required to complete the project is calculated for 15 weeks. Budget is calculated to be
$81,200 and is calculated based on the hourly rate provided by the contractors and
subcontractors. Referring to Table 11-1 of PMBOK Guide, the impact scales of risk on major
project objectives are aimed to be low (0.10), with less than 10% increase in the actual cost
of work performed (ACWP) and less than 5% increase of the scheduled time.

1. Estimate Cost
Estimate cost is “the process of developing an approximation of the monetary
resources needed to complete project activities” (Mowen, Hansen and Heitger, 2009). Cost
estimating is linked closely with scope, schedule, and resource planning.
1.1 Estimate Cost: Tools and Technique
1.1.1 Bottom-up estimation
Bottom-up estimating is “a method of estimating project duration or cost by aggregating
the estimates of the lower-level components of the WBS” (Rad, 2015). For a bottom-up
estimate, the WBS needs to be broken down to the most detailed level, and the
specifications need to be very clear as shown in Table 3. Advantages of Bottom-up
estimating over other tools are mainly because it is decentralized and participative, has
greater employee motivation, suits large organization, accurate and serves better
coordination and communications (Gilani, 2017). The disadvantage of Bottom-up estimation
is that every subcategory must be addressed as if it is missed the result of loss will be 100%.
2. Determine Budget
Determine Budget is the process of aggregating the estimated costs of individual
activities or work packages to establish an authorized cost baseline. The key benefit of this
process is that it determines the cost baseline against which project performance can be
monitored and controlled. Figure 1 displays the data flow diagram to determine budget
(Project Management Institute. 2013a).
Figure 1: Determine Budget Data Flow Diagram