Monte Carlo Simulation Challenges. Simulating the true source of uncertainty

Monte Carlo Simulation Challenges. Simulating the true source of uncertainty

by | 9 May, 2023 | Blog

Usually, duration and cost uncertainties are used as a base for the Monte Carlo Simulation (MCS). However, the duration and cost uncertainties are the results of other types of uncertainties.

Simulating the source and result of uncertainties may lead to different estimates. Sometimes substantially different. Most risk simulation tools do not work with the source data and only simulate duration and cost uncertainties.

Uncertainty Types

Any project has Primary, Secondary and Project Level Uncertainties.

Uncertainty is a situation where multiple alternatives result in a specific outcome, but the probability of the outcome is not certain.

Ref: Risk vs Uncertainty
https://saluteenterprises.com.au/risk-vs-uncertainty

Many factors may impact the duration of the activity.

Ref: Critical path method challenge: Activity duration estimation
https://saluteenterprises.com.au/critical-path-method-challenge-activity-duration-estimation

Duration and cost of any activity are secondary uncertainties that are the result of the true primary uncertainties. The primary uncertainties include Volume of Work, Resource Productivity Rate and Cost, Skills Quantity, Resource & Activity Calendars, Material Quantity and Cost, etc.

Does it matter?

Is it important for the MCS analysis? Why, after the probabilities to meet project objectives (time & cost) are calculated, we can’t analyse the sources?

Such analysis must be done BEFORE the simulation as the result of the MCS depends on what is simulated: primary or secondary uncertainties.

Let’s consider two simple projects consisting of a single activity:

Project 1
• The volume of work for this activity is 800 units
• Activity duration depends on the assigned resource’s productivity, with the optimistic estimate of 1.25 u/h, the most likely estimate being 1 u/h, and the pessimistic estimate being 0.8 u/p.
• The workday is 8 hours
• Uncertainty Type: Resource Productivity (-20%, +25%)

Project 2
• The volume of work for this activity is 800 units
• Activity duration depends on the volume of work, with the optimistic estimate of 640 units, the most likely estimate being 800 units, and the pessimistic estimate being 1,000 units.
• The workday is 8 hours
• Uncertainty Type: Volume of Work (-20%, +25%)

Both projects have the same duration uncertainty: 80 /100 /125 days, and the uncertainty range: -20% / +25%. If the duration uncertainty is used as the base for MCS, the probability of delivering the project in 100 days will be the same for both projects. If the true uncertainties are used instead, the duration uncertain the result will be different.

Let’s review three scenarios simulating secondary uncertainty (duration) and primary uncertainties (Resource productivity and Volume of work).

Scenario 1: Duration uncertainty

If the work is represented by a single activity with three estimations (80d, 100d, 125d) and the activity duration is used as the base of uncertainty, as the result of MCS would be as following:
• 100d = 43%
• P75 = 108d
• P90 = 114d
• Distribution: Triangular
• Number of iterations: 50,000

Scenario 2: Resource productivity uncertainty

If the work is represented by a single activity with three estimations (80d, 100d, 125d) and the resource productivity (0.8, 1, 1.25) is used as the basis of uncertainty, the result of MCS would be as follows:

• 100d = 55%
• P75 = 106d
• P90 = 112d
• Distribution: Triangular
• Number of iterations: 50,000

Scenario 3: Volume of work uncertainty

If the work is represented by a single activity with three estimations (80d, 100d, 125d) and the volume of work (640, 800, 1000) is used as the basis of uncertainty, the result of MCS would be as follows:

• 100d = 44%
• P75 = 108d
• P90 = 115d
• Distribution: Triangular
• Number of iterations: 50,000

Activity Duration Formula

Why is the result of Scenario 2 different from Scenarios 1 and 3?
As mentioned, activity duration depends on many parameters. These parameters impact the probability of completion in different ways. It is impossible (at least for now) to create a complete formula that shows how all primary uncertainties impact activity duration as some parameters (resource quantity uncertainty, etc.) also depend on other activities. Still, the simplified formula that only includes reviewed scenarios is:

As we can see above, it does matter if the Primary uncertainty is the Numerator or Dominator, as it impacts the distribution curve!

In the first case (scenario 2) the probability of achieving the Most Likely duration is >50%, and in the second case (scenario 3), it is <50%.

Complex uncertainties

We reviewed a simple example with the uncertainty of one parameter to explain the challenge. It is clear that just for one activity without specialised risk simulation software that supports the simulation of primary uncertainties, it is very hard to understand how primary uncertainties impact activity duration uncertainty.
The real-life relationship is more complex as:

Activity may have more than one source of uncertainty.

What would the Optimistic & Pessimistic duration and the distribution curve be if an activity has uncertainties in many primary parameters? Is it impossible to understand it accurately?

It is very hard, and there is a good chance that even experienced estimators make costly mistakes when they provide 3-point estimations.

Do demonstrate it before you read the result guess:
If the activity has both (Volume of work and Productivity) uncertainties,
– What would be the probability to complete the activity in 100 days?
– What would be the optimistic & pessimistic durations?

Scenario 4: Volume of Work and Productivity uncertainties

There is 47% chance to complete this activity in 100 days.
The most likely duration is 96 days and the Optimistic – Pessimistic range is: -32% , +52% (!).
Have you noticed that the curve is starting to get a “fat tale”? Take note, I will go back to the “fat tale” anomaly in future posts.
This was a simple example, as all required information was given  (even preliminary calculations!). Do you have this right? Probably not.

It is much easier to provide reliable 3-point estimations for primary uncertainties and calculate duration uncertainties than estimate duration uncertainty correctly.

We have simulated only one activity. Projects have thousands of them. How does this challenge impact project-level uncertainties? This is not an easy question that requires separate deep analysis. However, practically we can see that:

Simulating the result of uncertainty rather than its source, the level of accuracy is substantial to say that the result is misleading, not just inaccurate.

Let’s review one more scenario to demonstrate that.

Scenario 5: Duration uncertainty in detailed schedule

Assume the scheduler for this project decided that each activity has to be no longer than ten days and converted the schedule to 10 linked activities. Visually nothing is changed. The project has the same duration and uncertianties. Has this impact the probablity? 

If the work is represented by ten 10-day activities with three estimations (8d, 10d, 12.5d) and the activity duration is used as the basis of uncertainty, the result of MCS would be as follows:
• 100d = 28% (!)
• P75 = 104d
• P90 = 105d
• Distribution: Triangular
• Number of iterations: 50,000

 

It does not look logical. 

Probability distribution should not depend on how the work is presented in the project schedule!

The project duration uncertainty depends on uncertainties of activities. However, as they are linked in a sequence, uncertainties compensate each, and simulation shows that only 105 days are required to achieve 90% probability.
The durations of all ten activities are strongly correlated, but this correlation is different. If a resource with low productivity is available for the assignments, it will impact all ten activities similarly. If the source of uncertainty (resource productivity) is simulated instead of the result (activity duration), this problem would not exist.

Scenario 6: Productivity uncertainty in a detailed schedule

If the work is represented by ten 10day activities and the resource productivity (0.8, 1, 1.25) is used as the basis of uncertainty, the result of MCS would be as following:

• 100d = 55%
• P75 =106d
• P90 = 112d
• Distribution: Triangular
• Number of iterations: 50,000

We received the same result as it was in scenario 2 when the simulation was based on resource productivity, but the work was represented by one 100d activity!

– I used the triangular distribution to make it possible for others to verify the analysis. If PERT or Long-Normal distributions are used instead the difference in the results will be even bigger.
– This challenge alone has a significant effect, but when correlated with other discussed in previous (and future) posts issues, it has accumulated effect and the results of MCS are likely to be misleading. 

Summary

  • Activity duration and cost uncertainties are the results of other types of uncertainties. They called secondary and primary uncertainties.
  • The primary uncertainties impact activity duration and probability of completion activity in planned duration. However, without Project Management software that supports the simulation of primary uncertainties, it is not easy to understand the relationship between primary and secondary uncertainties.
  • An activity may have more than one source of uncertainty. The correlation between them is complex. In some cases, primary uncertainties may compensate for each other and in other situations, the impact may be accumulated.
  • On the activity level simulating the source and result of activity uncertainties may lead to different estimates. Sometimes substantially different and even experienced estimators are likely to make mistakes in providing 3-point estimations. It is much easier to provide reliable 3-point estimations for primary uncertainties.
  • Projects have thousands of primary uncertainties. If simulating the result of uncertainty rather than its source, the deviation from the correct result will be substantial to say that it is misleading, not just inaccurate.
  • Most project management Monte Carlo solution tools don’t work with primary uncertainties, and the results produced based on these tools are unreliable.

Alex Lyaschenko

PMO | Portfolio Planning & Delivery | PMP | P3O Practitioner | AgilePM Practitioner | Six Sigma

Project Acceleration

Project Acceleration

by | 28 Apr, 2023 | Blog

Project acceleration criteria

Critical Path (CP) Drag shows amount of time that could potentially be saved on the project by reducing the duration of the activity or removing an activity completely.

However, CP Drag only identifies good candidates for optimisation. It doesn’t mean that such optimisation is possible. Two more criteria have to be met as well:

  • Assignment of additional resources allows completing the activity in a shorter period
  • Resources have to be available

Assignment limits

Any activity has a maximum limit of resources that could be assigned to deliver the activity. The limit is due to technological processes (2 cars can’t deliver twice quicker than one car), space (no space for three cranes) or increasing complexity associated with required collaboration (no more than two designers per design).
There is a few ways for changes in resource assignments that can decrease activity duration:

  • Additional resources (two extra workers)
  • Increase % of assigned resources (80% -> 100%)
  • Replace resources with a better productivity rate (10m/h -> 15m/h)
  • Combination of the above changes

As assigned resources may have different productivity rate, changes in activity duration are not always proportional to the number of assigned resources (replace a small bulldozer with two big bulldozers).

Resource limits

If there is an opportunity to speed up delivery by changing resource assignment, practically it is only possible when required resources are available when they are needed.

If additional resources are not available internally, it could be an opportunity to hire them. It usually means additional cost. In another hand, the project is likely to have direct and indirect benefits associated with reduced project duration. It includes:

– Reduced project management costs;
– Financial and reputational bonuses;
– Opportunity to reallocate resources to another project earlier.

Apart from Critical Path Drag, Stephen A. Devax introduced the Drag Cost metric that identifies if acceleration is beneficial. 

Points to consider:

  • The technological resource limit is a characteristic of activity. It has to be documented, and Resources Critical Path algorithms must consider resoucre possible limits.
  • It may be possible to achieve the required result by applying different technological processes (workers with spades instead of bulldozer). In this case, the activity could be replaced with a different activity of a set of activities. 
  • When CP Drag is negative, project acceleration could be achieved by increasing the number of assigned resources (anti-crashing method). However, activities also have lower limits: minimum required quantity (one worker to move a chair and minimum of two workers to move a desk) or minimum percentage of availability (assign resource with availability over 20% only). The lower limits must also be documented and used when calculating the resource-critical path.
  • Other CP metrics are complementary to CP Drag: Start & Finish Flex, Super Float, and Activity Spread.
  • Apart from crashing the acceleration could be achieved by changing schedule logic (fast-tracking)

Alex Lyaschenko

PMO | Portfolio Planning & Delivery | PMP | P3O Practitioner | AgilePM Practitioner | Six Sigma

Learn to avoid Project Delay

Learn to avoid Project Delay

by | 15 Apr, 2023 | Blog

A small number of projects are finished ahead of schedule. Even projects who claimed to be on time often are against the latest commitment, not the originally approved target. This is relevant to almost all types of projects of all sizes and different countries. Why this is the case?

Because project optimisation does not happen automatically. Projects need methodology, tools and people who want to know optimisation methods and techniques.

The paradox is that planners/schedulers who work on project claims and can explain WHY PROJECT WAS LATE are paid much more than project consultants that could help projects AVOID DEALAYs.

As the result, when, for whatever reason, a portfolio (or even a country) has a project where time has a bigger priority than cost there are no specialists who know project management methods to accelerate delivery.

Alex Lyaschenko

PMO | Portfolio Planning & Delivery | PMP | P3O Practitioner | AgilePM Practitioner | Six Sigma

Multiple Work Breakdown Structures

Multiple Work Breakdown Structures

by | 3 Apr, 2023 | Blog

Multiple Work Breakdown Structure (WBS) is a powerful method to document, analyse and report project activities via different lenses. This approach provides an opportunity to understand project delivery from many perspectives and increases chances for success.

Unfortunately, many project practitioners never apply more than one WBS for the same project, don’t understand the concept of Multiple WBS, and even believe that a project may only have one WBS. At the same time, project stakeholders often have different views on the optimal WBS. It results in project conflicts, program restructures, schedule redevelopments and hidden schedules.

Project perspectives

Project work could be reviewed as a list of activities or in an aggregated hierarchical way known as Work Breakdown Structure. For effective project analysis and control, it is very useful to understand project work from more than one perspective and apply Multiple WBS.

WBS (Work Breakdown Structure)

PMBOK defines Work Breakdown Structure as: “A deliverable-oriented hierarchical decomposition of the work to be executed by the project team to accomplish the project objectives and create the required deliverables. It organizes and defines the total scope of the project. Each descending level represents an increasingly detailed definition of the project work”.

In simple words: WBS is a hierarchical decomposition of the project deliverables into smaller, more manageable components. WBS provides an aggregated view of project work. There are many ways how work could be aggregated.

The project’s main structure is based on the project Life Cycle and activities grouped by project phases: planning, design, development, testing, and implementation. The project has three releases and requires some test activities:

  • Planning: Test Strategy
  • Design: Test Management Plan
  • Development: Test Cases Development (Release 1, 2 & 3)
  • Testing: Tests Execution (Release 1, 2 & 3)
  • Implementation: Post-implementation testing (Release 1, 2 & 3)

The project manager needs to understand the project in the context of project gates, the test manager needs a test schedule and the release manager needs schedules for each release. Instead of developing different schedules to satisfy everyone’s needs, it is recommended to have only one E2E schedule with Multiple breakdown structures to control projects from different perspectives. Each perspective includes relevant activities in the context of the overall delivery.

Work Breakdown Structures

The WBS is a generic term that doesn’t explain the way of aggregation.

Three Work Breakdown Structures are applicable to most of the projects: based on project deliverables, project processes and responsibilities.

  • Scope Breakdown Structure
    Structure helps define project boundaries and breaks down the scope of a project into smaller, more manageable pieces and verifies that all scope elements are in a project delivery plan, and ‘out of scope’ elements are excluded.
  • Process Breakdown Structure
    Focuses on project processes required to complete project activities. The structure includes primary and supportive processes.
  •  Responsibility Breakdown Structure (Organisation Breakdown Structure)
    Work grouped by responsibilities and help identify and organise resources required for successful project delivery.

Depending on the nature of the project, some other Work Breakdown Structures could also be helpful to apply:

  • Contract Breakdown Structure
    The highest level represents the overall contract, and each subsequent level includes work delivered by subcontractors.
  • Release Breakdown Structure
    Each level of the RBS represents a different level of detail in the project release components, with the highest level representing the overall release and each subsequent level representing smaller, more detailed components of the release. RBS is a popular structure for technology projects or business projects with technology components.
  • Location Breakdown Structure
    Project work grouped by physical locations of project deliverables.

One WBS could combine different WBS types. The top levels in the structure represent one type, and the lower levels another.

How do Multiple WBS work?

A base for each WBS is the same: a complete list of activities. It means that:

  • Project activities are the same in all structures
  • The logic between project activities is the same in all structures
  • Critical path is the same in all structures

Usually, it is easy to start with “Top-Down” approach and develop a Scope Breakdown Structure first, starting from the decomposition of the project scope into smaller and more manageable work components. The decomposition can stop when the built structure helps find answers to the project’s key questions (What and How) with a sufficient degree of accuracy. This structure is a Primary WBS.

After the primary WBS is developed, each element in the structure could be extended with project activities and logic between them.

For smaller projects, it could be easier to start with the ‘Bottom-Up’ approach and develop a list of activities. Only then group these activities into a structure.

After an alternative WBS is developed, each activity is mapped to a relevant WBS element in the new structure.

There is a chance that the developed project delivery plan has some activities missing or that further decomposition is required. Multiple WBS can help in identifying these gaps:

  • If a WBS element in the new structure doesn’t contain any activities, it could be a sign that project activities are missing in the primary WBS
  • If there is no WBS element in the new structure where activities could be moved, it could be a gap in the new WBS.

If the primary and the new WBS vary only at the top levels, the lower-level WBS elements are mapped instead. Activities already belong to the lowest level WBS elements, and there are the same in both structures.

After multiple WBS are developed project team has an opportunity to analyse and report project progress via different lenses. It includes quality, performance, what-if, resource, cost and risk analysis.

How do scheduling tools support multiple WBS?

Microsoft Project doesn’t have dedicated WBS features, Primavera supports one WBS and Spider Project supports Multiple WBS.

Microsoft Project and Primavera P6

While Microsoft Project and Primavera don’t support Multiple WBS, there is a workaround to get visibility of project work from different perspectives. Both systems provide an opportunity to group activities. Combined with custom activity codes, it is possible to get multiple hierarchical structures and switch between them.

Grouping in Microsoft Project:

A hierarchical structure in Microsoft Project could be organised via custom fields.

Text custom fields support only one level, so multiple levels are organised via different custom fields. This is time-consuming and leads to data quality issues. Instead, it is recommended use Outline codes as they support multiple levels.

Outline Code in Microsoft Project:

Hierarchical structure in Microsoft Project:

 Primavera also supports hierarchical structures in activity codes. 

For portfolio scheduling, hierarchical structures should be developed in Enterprise codes and applied across all projects in the portfolio.

 

It is important to remember that the Grouping and Multiple WBS are not exactly the same. WBS is not just an aggregated VIEW of project activities. It also allows ANALYSIS of elements in the structure.

Microsoft Project and Primavera P6 automatically recalculate duration, cost and dates but don’t store the calculation results. When the view is changed, the result of the calculation is lost.

In theory, it is possible to export schedules for quality, performance or risk analysis in an external tool. Still, practically the imported schedule will have only one structure. I am not aware of any risk and quality analysis tool that supports Multiple WBS.

Spider Project

Spider Project allows having an unlimited number of Work Breakdown Structures and offers features that help users develop new  WBS in a simple and fast way.

The system also allows users to exclude activities from a structure.

Excluded activities are hidden, not deleted. If required, excluded activities could be added back. It unlocks some interesting and powerful opportunities for the users.

For example, Partial WBS could be used to control a level of access to different stakeholders or combined with layouts used for data collection and reporting.

‘Enclose into a new phase’ is a new feature added in January 2023 release (23.06.13).

WBS in Spider Project:    

Activities in both structures are the same but grouped based on different WBS. Activities 8 & 9 are hidden in WBS2. 

 WBS 1

WBS 2

Other Breakdown Structures

Work Breakdown Structure is not the only type of hieratical structure in a project. Other project portfolio parameters could also be organised hieratically for better analysis and control.

 

  • Cost Breakdown Structure
    The main structure for project cost control. The CBS typically includes different types of costs: labour costs, material costs, equipment costs, overhead costs, and contingency costs. CBS in scheduling and financial systems has to be aligned.
  • Portfolio Contract Breakdown Structure
    A vendor could be involved in multiple projects. Portfolio Contract Breakdown Structures are used to get reports on the contract performance and contract cash flows.
  • Material Breakdown Structure
    This structure helps to plan and control materials and components that are required to deliver the project. Materials are usually grouped by materials cost centres.
  • Product Breakdown Structure
    This structure helps document, analyse and communicate the outcomes of a project, and the components leading to these outcomes.
  • Risk Breakdown Structure
    Project work is organised by risks category. Structure helps to predict risks, assess their likelihood and impact, and add mitigation actions to the project delivery plan.
  • Enterprise Breakdown Structure
    Project activities may have relationships with other projects in an organisation. This structure helps to understand, control and analysis impacts of these relationships.
  • Value Breakdown Structure
    A concept introduced by Stephen Devaux as part of the total project control (TPC) approach. VBS separates project’s work packages into mandatory and optional categories and estimates the value-added for each optional activity and/or component of the project.

Summary

  • Work Breakdown Structure is a hierarchical decomposition of the project deliverables
  • WBS is a generic term. There are many ways how project activities could be grouped.
  • The key benefit of Multiple WBS is that each WBS element could be used for analysis and communication
  • Grouping views and Multiple WBS are not the same
  • Multiple WBS is a powerful method that allows documenting, analysing and reporting projects via applying it via different lenses. This approach provides an opportunity to understand project delivery from many perspectives and increases chances for success.

Project perspectives

Multiple Work Breakdown Structure (WBS) is a powerful method to document, analyse and report project activities via different lenses. This approach provides an opportunity to understand project delivery from many perspectives and increases chances for success.

Unfortunately, many project practitioners never apply more than one WBS for the same project, don’t understand the concept of Multiple WBS, and even believe that a project may only have one WBS. At the same time, project stakeholders often have different views on the optimal WBS. It results in project conflicts, program restructures, schedule redevelopments and hidden schedules.

Project work could be reviewed as a list of activities or in an aggregated hierarchical way known as Work Breakdown Structure. For effective project analysis and control, it is very useful to understand project work from more than one perspective and apply Multiple WBS.

WBS (Work Breakdown Structure)

PMBOK defines Work Breakdown Structure as: “A deliverable-oriented hierarchical decomposition of the work to be executed by the project team to accomplish the project objectives and create the required deliverables. It organizes and defines the total scope of the project. Each descending level represents an increasingly detailed definition of the project work”.

In simple words: WBS is a hierarchical decomposition of the project deliverables into smaller, more manageable components. WBS provides an aggregated view of project work. There are many ways how work could be aggregated.

The project’s main structure is based on the project Life Cycle and activities grouped by project phases: planning, design, development, testing, and implementation. The project has three releases and requires some test activities:

  • Planning: Test Strategy
  • Design: Test Management Plan
  • Development: Test Cases Development (Release 1, 2 & 3)
  • Testing: Tests Execution (Release 1, 2 & 3)
  • Implementation: Post-implementation testing (Release 1, 2 & 3)

The project manager needs to understand the project in the context of project gates, the test manager needs a test schedule and the release manager needs schedules for each release. Instead of developing different schedules to satisfy everyone’s needs, it is recommended to have only one E2E schedule with Multiple breakdown structures to control projects from different perspectives. Each perspective includes relevant activities in the context of the overall delivery.

Work Breakdown Structures

The WBS is a generic term that doesn’t explain the way of aggregation.

Three Work Breakdown Structures are applicable to most of the projects: based on project deliverables, project processes and responsibilities.

  • Scope Breakdown Structure
    Structure helps define project boundaries and breaks down the scope of a project into smaller, more manageable pieces and verifies that all scope elements are in a project delivery plan, and ‘out of scope’ elements are excluded.
  • Process Breakdown Structure
    Focuses on project processes required to complete project activities. The structure includes primary and supportive processes.
  •  Responsibility Breakdown Structure (Organisation Breakdown Structure)
    Work grouped by responsibilities and help identify and organise resources required for successful project delivery.

Depending on the nature of the project, some other Work Breakdown Structures could also be helpful to apply:

  • Contract Breakdown Structure
    The highest level represents the overall contract, and each subsequent level includes work delivered by subcontractors.
  • Release Breakdown Structure
    Each level of the RBS represents a different level of detail in the project release components, with the highest level representing the overall release and each subsequent level representing smaller, more detailed components of the release. RBS is a popular structure for technology projects or business projects with technology components.
  • Location Breakdown Structure
    Project work grouped by physical locations of project deliverables.

One WBS could combine different WBS types. The top levels in the structure represent one type, and the lower levels another.

How do Multiple WBS work?

A base for each WBS is the same: a complete list of activities. It means that:

  • Project activities are the same in all structures
  • The logic between project activities is the same in all structures
  • Critical path is the same in all structures

Usually, it is easy to start with “Top-Down” approach and develop a Scope Breakdown Structure first, starting from the decomposition of the project scope into smaller and more manageable work components. The decomposition can stop when the built structure helps find answers to the project’s key questions (What and How) with a sufficient degree of accuracy. This structure is a Primary WBS.

After the primary WBS is developed, each element in the structure could be extended with project activities and logic between them.

For smaller projects, it could be easier to start with the ‘Bottom-Up’ approach and develop a list of activities. Only then group these activities into a structure.

After an alternative WBS is developed, each activity is mapped to a relevant WBS element in the new structure.

There is a chance that the developed project delivery plan has some activities missing or that further decomposition is required. Multiple WBS can help in identifying these gaps:

  • If a WBS element in the new structure doesn’t contain any activities, it could be a sign that project activities are missing in the primary WBS
  • If there is no WBS element in the new structure where activities could be moved, it could be a gap in the new WBS.

If the primary and the new WBS vary only at the top levels, the lower-level WBS elements are mapped instead. Activities already belong to the lowest level WBS elements, and there are the same in both structures.

After multiple WBS are developed project team has an opportunity to analyse and report project progress via different lenses. It includes quality, performance, what-if, resource, cost and risk analysis.

How do scheduling tools support multiple WBS?

Microsoft Project doesn’t have dedicated WBS features, Primavera supports one WBS and Spider Project supports Multiple WBS.

Microsoft Project and Primavera P6

While Microsoft Project and Primavera don’t support Multiple WBS, there is a workaround to get visibility of project work from different perspectives. Both systems provide an opportunity to group activities. Combined with custom activity codes, it is possible to get multiple hierarchical structures and switch between them.

Grouping example (in Microsoft Project):

 

A hierarchical structure in Microsoft Project could be organised via custom fields.

Text custom fields support only one level, so multiple levels are organised via different custom fields. This is time-consuming and leads to data quality issues. Instead, it is recommended use Outline codes as they support multiple levels.

 

Primavera supports hierarchical structures in activity codes:

 

For portfolio scheduling, hierarchical structures should be developed in Enterprise codes and applied across all projects in the portfolio.

 

It is important to remember that the Grouping and Multiple WBS are not exactly the same. WBS is not just an aggregated VIEW of project activities. It also allows ANALYSIS of elements in the structure.

Microsoft Project and Primavera P6 automatically recalculate duration, cost and dates but don’t store the calculation results. When the view is changed, the result of the calculation is lost.

In theory, it is possible to export schedules for quality, performance or risk analysis in an external tool. Still, practically the imported schedule will have only one structure. I am not aware of any risk and quality analysis tool that supports Multiple WBS.

Spider Project

Spider Project allows having an unlimited number of Work Breakdown Structures and offers features that help users develop multiple WBS in a simple and fast way.

The system also allows users to exclude activities from a structure.

Excluded activities are hidden, not deleted. If required, excluded activities could be added back. It unlocks some interesting and powerful opportunities for the users.

‘Enclose into a new phase’ is a new feature added in January 2023 release (23.06.13).

Partial WBS could be used to control a level of access to different stakeholders or combined with layouts used for data collection and reporting.

WBS in Spider Project:    

 WBS 1

WBS 2

Other Breakdown Structures

WBS is not the only type of hieratical structure in a project. Other project parameters could also be organised hieratically for better analysis and control.

  • Cost Breakdown Structure
    The main structure for project cost control. The CBS typically includes different types of costs: labour costs, material costs, equipment costs, overhead costs, and contingency costs. CBS in scheduling and financial system has to be aligned.
  • Portfolio Contract Breakdown Structure
    A vendor could be involved in multiple projects. Contract Breakdown Structures are used to get reports on the contract performance and contract cash flows.
  • Material Breakdown Structure
    This structure helps to plan and control materials and components that are required to deliver the project. Materials are usually grouped by materials cost centres.
  • Product Breakdown Structure
    This structure helps document, analyse and communicate the outcomes of a project, and the components leading to these outcomes.
  • Risk Breakdown Structure
    Project work is organised by risks category. Structure helps to predict risks, assess their likelihood and impact, and add mitigation actions to the project delivery plan.
  • Enterprise Breakdown Structure
    Project activities may have relationships with other projects in an organisation. This structure helps to understand, control and analysis impacts of these relationships.
  • Value Breakdown Structure
    A concept introduced by Stephen Devaux as part of the total project control (TPC) approach. VBS separates project’s work packages into mandatory and optional categories and estimates the value-added for each optional activity and/or component of the project.

Summary

  • Work Breakdown Structure is a generic term. There are many ways how project activities could be grouped.
  • The key benefit of Multiple WBS is that each WBS element could be used for analysis and communication
  • Grouping views and multiple WBS are not the same
  • Multiple WBS is a powerful method that allows documenting, analysing and reporting projects via applying it via different lenses. This approach provides an opportunity to understand project delivery from many perspectives and increases chances for success.
  • Due to technical limitations in popular scheduling tools, many of project practitioners never apply more than one WBS for the same project, don’t understand the concept of Multiple WBS, and even believe that a project may only have one WBS. At the same time, project stakeholders often have different views on the optimal WBS. It results in project conflicts, program restructures, schedule redevelopments and hidden schedules.

Alex Lyaschenko

PMO | Portfolio Planning & Delivery | PMP | P3O Practitioner | AgilePM Practitioner | Six Sigma

Predaptive delivery

Predaptive delivery

by | 25 Mar, 2023 | Blog

Agile vs Waterfall debates are continued with an interesting outcome. Some project management gurus believe that such debates don’t make sense as there is no such a thing as Agile and Waterfall projects, as all projects are Hybrid. However, if all projects are Hybrid, there is no such thing as Hybrid projects either.

I share their opinion, but in my posts, it is not easy to avoid using Waterfall, Agile and Hybrid terms, especially when we discuss project myths.

I think the root cause of the challenge is in applied project management language. There are formal and informal project delivery terms:

Adaptive approaches use iterative and incremental approaches. Predictive and Adaptive are equivalent to Waterfall and Agile, but no word describes Hybrid.

I thought about what this word could be and came to the idea of combining already existing terms. Playing with different combinations and creating many interesting words, I found one word that is easy to understand and pronounce:

Predaptive – project delivery regardless of applied delivery approach.

Alex Lyaschenko

PMO | Portfolio Planning & Delivery | PMP | P3O Practitioner | AgilePM Practitioner | Six Sigma