BG010: Business Project Management Report on Factory Renovation

This report details a project management plan for the renovation of an old factory to accommodate retail space and apartments. The project, with a budget of $250,000, involves comprehensive reconstruction, including electrical and plumbing work across two floors totaling 745m2. The report outlines the required skills and techniques for the project team, emphasizing communication, knowledge of management tools, construction equipment, safety awareness, and problem-solving. It defines the project scope, including modifications, electrical and furnishing work, and a 60-day timeline, while also establishing a detailed budget breakdown for materials and labor. Risk management strategies, including a risk matrix, are presented, along with a contingency fund estimate to address potential budget overruns. Furthermore, the report analyzes a crucial decision-making scenario involving supplier issues, comparing options and justifying the selection based on financial impact and project feasibility. The report concludes with a comprehensive overview of project requirements, budget allocation, and risk mitigation strategies.

Running head: BUSINESS PROJECT MANAGEMENT
Business Project Management
Name of Student
Name of University
Author Note

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Table of Contents
1. Introduction......................................................................................................................2
2. Skills and Techniques Required by the Team.................................................................2
3. Project Scope and Anticipated Outcome.........................................................................3
4. Project Budget.................................................................................................................6
5. Contingency Fund Estimate.............................................................................................7
6. Risk management.............................................................................................................7
7. Unforeseen Situation and Crucial Decision Making.......................................................8
References..........................................................................................................................10

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1. Introduction
A project for reconstruction of the premises of an old factory is chosen to allocate space
for retail in the ground floor of a building along with the development of two apartment unit on
the first floor. The project is needed be completed within the budget of $250,000. This budget is
approved by the sponsor and therefore it is crucial to complete the undertaken project within the
set budget. A detailed project management plan will be prepared that will ascertain correct
execution of the project. The factory space that is to be renovated is quite old and therefore
majority of the parts are needed to be reconstructed. Electrical and certain necessary plumbing
works are to be done in both the floors. The total area on both the floors are 745m2. The project
does not involve any external works.
This particular project is chosen as I have a working experience in project management. I
have worked in similar other projects and therefore, working in this project will provide me with
an opportunity of excelling in my work. The project management report discusses the main skills
and techniques that are needed in the team along with the scope and budget of the project. The
report identifies the critical risks and also outlines the contingency fund estimate for the project.
2. Skills and Techniques Required by the Team
Since a lot of work is to be done in the project, certain effective skills and techniques are
needed to be possessed by the entire team to ascertain that the entire project is completed in an
accurate manner. The most important skills that are required by the team member are indicated
as follows-
Communication: Good communication among the team member are necessary to ascertain that
the issues among the team are correctly communication. In management of this type of critical
project, having effective communication abilities are needed (Kerzner, 2017). Employers and the
customers are needed to communicate among each other to ascertain no issues within the project
team remain unattended.
Knowledge about effective management tools and techniques: For successful execution of a
project the team needs to have a knowledge about different effective techniques and tools related
to management of a project. The effective techniques of managing a project include

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understanding the approaches that can help in delivery of the project within a set time.
Knowledge about the construction Equipment: This is another need of execution of the
undertaken project in a correct manner. Since the undertaken project is based on reconstruction,
knowledge about different construction equipment is needed to ascertain that the project is
executed as per plan (Meredith, Mantel Jr & Shafer, 2017). This is further needed to ascertain
that the best equipment are used in the construction project.
Safety Awareness: Safety awareness is another needed considerations linked with the correct
execution of the project (Harrison & Lock, 2017). Since it is mostly a construction project,
appropriate safety awareness is needed in the project team.
Problem Solving Skills: This is another important skill that a project team or the manager of the
undertaken project needs to possess to ascertain the success of the project (Boyle, 2017).
Problems and clashes are common in execution of a project and therefore, effective problem
solving skills are necessary for considerations in management of the project (Kerzner, 2017).
The above discussed points indicate the skills that are needed by the manager to ascertain
that the undertaken project work is executed in an effective manner.
Accurate execution of the undertaken project needs the project team to apply certain
effective techniques that can address the completion of the project in an accurate manner
(Hopkinson, 2017). The required techniques are indicated as follows-
Effective Leadership: Following a correct and an effective leadership method is necessary to
motivate the project team in execution of the project as per plan (Kerzner, 2018).
Use of traditional Project Management methods: Use of traditional and global method of
management of the project is an effective technique that is required for execution of this project.
The above two points indicate the technique that are needed to be possessed by the
project team for successful execution and completion of the project.
3. Project Scope and Anticipated Outcome

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Developing a plan for execution of a project required identification of the related scope of
the undertaken project so that the said project is finished in an effective manner (Heldman,
2018). It is quite crucial to understand and identify the critical scope of the undertaken project.
The overall in scope requirement that are identified for this project are indicated as
follows-
 To modify and reconstruct both the floors
 To carry out the electrical and furnishing works
 To complete the work within a set deadline of 60 days
The overall out scope requirement of project are indicated as follows-
 No external work outside the building will be carried out
 No works will be done in the weekend
The in scope and the out scope requirements of the project are identified that will
contribute to the successful execution of the project. Since the project is set to be finished within
a budget of $250,000, developing of a realistic plan for execution of the project is necessary.
Since it is estimated that the project is to be finished within 60 days, the task estimation is
divided into task for 8 weeks. The scope of the project on basis of the works to be completed in
each of these weeks are indicated in the following paragraphs-
Scope for Week 1:
1. Thorough inspection of the property that is to be renovated
2. Completion of the wiring and the plumbing works
3. Replacing the existing furniture along with the doors and windows as per needs
4. Repairing of the damaged walls after completion of the electrical works
Scope for Week 2:
1. Receiving all the ordered goods from the supplier
2. Completion of all the plumbing works that are needed to be completed, which include
fixing the plumbing connection in the kitchen and the existing toilets.

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3. Allotment of the resources as per the required work that is to be done
Scope for Week 3:
1. Completion of the major construction works needed in the factory
2. Completion of the plumbing works in the two apartment units
3. Refitting of all the plumbing essentials needed in the bathrooms of the apartments in the
first floor and also in the ground floor.
4. Majority of the plumbing and refitting works will be completed within this time.
Scope for Week 4:
1. All the furnishing works mainly of the kitchen will be completed as per the plan
2. A review of the works completed till week 4 will be done in this particular week to
develop the progress report that will be shared with the clients.
Scope for Week 5:
1. The minor works outside the building will be carried out in this week
Scope for Week 6:
1. All the required decorations outside the building will commence in this week
2. All the related painting works will start in this week
Scope for Week 7:
1. The needed painting works will continue in this week as well
2. Carpet in all the floors will be fitted
3. All the remaining electrical works will be completed
Scope for Week 8:
1. The project manager will check if all the tasks are completed as per plan
2. A project evaluation report will be prepared
3. A completed project will be delivered to the clients.

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4. Project Budget
The project budget is estimated on basis of the materials needed and the labor cost. The
budget set for the project are indicated in the table below-
Materials Cost (in $)
Construction materials 50000
Kitchen Appliances 30000
Tiles and adhesive 20000
Paints 30000
Carpets 10000
Plaster 5000
Woods 10000
Furniture 50000
Total 2,05,000
Labor Cost/Hr
Project Manager 50
Painter 20
Electrician 30
Tile Fitter 25
Plumber 40
Project Supervisor 45
Table 1: Representing the set budget of the Project

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The budget estimate in the table above indicates that it is possible to complete the project
within the budget set.
5. Contingency Fund Estimate
Although the budget of the project is estimated on basis of the works that are needed to
be completed along with the materials requirement, there are chances of the project going over-
budget.
Therefore, as a part of the contingency budget plan, material cost are considered at a 5%
greater price while the maximum payment of the laborers are considered.
6. Risk management
This particular renovation project is linked with a number of risks. The risks identified
for the project are indicated in the risk matrix below-
Insignificant Minor Moderate Major Catastrophic
Certain High High Extreme Extreme Extreme
Likely Moderate
(2)
High High
(5)
Extreme
(3)
Extreme
Moderate Low Moderate
(1)
High Extreme
(6)
Extreme
Unlikely Low Low Moderate High
(4)
Extreme
(7)
Rare Low Low Moderate High High
Table 2: Representing the Risk Matrix
1. Project Delays due to delay in construction works
2. Resource shortage due to unavailability of the resources

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3. The items ordered were not delivered on time
4. Problems with the fitting of the kitchen appliances
5. Budget issue and project going over-budget (Heldman, 2018)
6. Delay in the release of funds from sponsors
7. Injury while completion of the works outside
7. Unforeseen Situation and Crucial Decision Making
For Option A: On account of closing down of the main suppliers, If I approach to source the
product required, I will have to buy the products at 30% higher rate. This is impossible
considering I have considered only 5 % contingency on the material cost. In this case, the only
savior can be the sponsor, who will need to pay for the overpriced materials. However, even of
the sponsors agrees to pay, there can be a situation of conflict with the sponsors and the project
team.
For option B: The closing down of the main supplier is unforeseen and therefore, an extension
of 30 days can be taken from the sponsors. This will increase the cost by 10%. We have already
considered 5% contingency on the materials cost and therefore, the sponsors only need to pay for
the remaining amount. However, since the laborers are paid on an hourly rate, the labour cost
will increase.
Original Budget: $250,000
Increase in budget: 10%
Current Budget: $275,000
Contingency: $10,250
Extra payment required: 14,750
Extra rental: $5000
Total extra payment required: $19750

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Budget increase: 7.9%
I would choose option B as in this option, the sponsor will need to spend only 7.9% more
money that the original estimated budget while if option A is chosen, the sponsor will have to
spend 30% more money. Thus, the choice of option B is justified.

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References
Boyle, G. (2017). Design project management. Routledge.
Harrison, F., & Lock, D. (2017). Advanced project management: a structured approach.
Routledge.
Heldman, K. (2018). PMP: project management professional exam study guide. John Wiley &
Sons.
Hopkinson, M. (2017). The project risk maturity model: Measuring and improving risk
management capability. Routledge.
Kerzner, H. (2017). Project management metrics, KPIs, and dashboards: a guide to measuring
and monitoring project performance. John Wiley & Sons.
Kerzner, H. (2017). Project management: a systems approach to planning, scheduling, and
controlling. John Wiley & Sons.
Kerzner, H. (2018). Project management best practices: Achieving global excellence. John
Wiley & Sons.
Meredith, J. R., Mantel Jr, S. J., & Shafer, S. M. (2017). Project management: a managerial
approach. John Wiley & Sons.