Why Work Breakdiw Structure is a must for Capital Projects Delivery


Bassam Samman

All project management best practices introduce breakdown structures as a proven technique to decompose the project into smaller components that can be managed, monitored, controlled and reported on. Those breakdown structures include Work Breakdown Structure, Organization Breakdown Structure, Cost Breakdown Structure, Location Breakdown Structure, Document Breakdown Structure and Risk Breakdown Structure among others. In addition, projects’ intensive organizations would also have Enterprise Projects Structure or Portfolio Breakdown Structure.

Project Management Information Systems (PMIS) like PMWeb would provide the organization with a single integrated platform to have all those breakdown structures which will be associated with all relevant project transactions. Also, it is important the planning and scheduling system like Oracle Primavera P6 are aligned with the same breakdown structures captured in the PMIS. The same is also true to other applications that need to be integrated or interfaced with the PMIS or planning and schedule application.

How to Align Projects with Organization’s Strategy?

The Portfolio Breakdown Structure (PBS) is the structure that an organization will use to align their programs and projects with their strategic objectives which are needed to achieve their desired vision. The PBS will include all project investments including approved, under review, on-hold and completed projects. It will also display the programs which are considered as strategic initiatives and the projects that are part of those programs.

How to Have Common Understanding of the Project’s Scope of Work?

The Work Breakdown Structure (WBS) is the structure used to subdivide the major project deliverables and project work into smaller, more manageable components, also known as scope decomposition. A deliverable is any unique and verifiable product, result or capability to perform a service that is identified in the project management plan, and must be produced and provided to complete the project.

The WBS is the most important and used breakdown structure in managing, monitoring, evaluating and reporting project performance. For example, each project activity, each project cost estimate, budget or commitment, each risk event, each project communication needs to have a WBS level assigned to it.

How to Monitor and Control the Project’s Financial Performance?

The Cost Breakdown Structure (CBS) is the chart that will be used to monitor and control the project’s budget, procured contracts, changes and actual cost. The scope of work assigned to the WBS levels could have different CBS values depending on the organization’s strategy in outsourcing the project’s scope of work as well as their corporate office financial management requirement. That is why the CBS should be always aligned with the cost centers used by the organization’s financial and accounting system.

How to Locate the Work Performed Within Your Project?

In capital projects, the project WBS will never be detailed to the exact location where a project schedule activity was performed, quality issue was identified or any other issue that could have an impact on the project’s delivery. The Location Breakdown Structure (LBS) is used to identify the different locations of the project which will include the tower, level, zones and room number. The LBS will be mainly assigned to project schedule activities, completed work reported in daily reports, site inspection, non-compliance reports, items within a snag list among

How to Locate the Documents that are Specific to a Project Topic?

Every capital project will always have what is know as the filing room where it will many file folders that contain the formal and informal project documents and communications generated and exchanged during the project life cycle stages. This requires having a Document Breakdown Structure (DBS) the details how project documents and records will be stored and located. Those documents and records can then be linked to any project schedule activity or record.

How to Ensure that all Risks that Could Impact our Project are Identified?

Every capital project is based on many assumptions that only time will provide if their wrong or true. The ability to identify all or most of the risks that could impact the project’s on-time and within budget completion can make the different between a successful and failed project. Risk Breakdown Structure (RBS) helps in determining the different risk categories and risk events that capital projects could encounter. Unlike the previous detailed breakdown structures which could be specific for each, the RBS tend to be standard for all projects that the organization have. Actually, the RBS needs will be continuously populated with emerging and new risks that the organization has identified from delivering the projects. The occurrence likelihood and impact that each risk could have on the project’s objectives could vary from one project to another.

Conclusion

Breakdown structures provide a systematic and structured approach that project team members can use to decompose the particulars of any capital project to better understand what the project scope is, who should be involved in delivering the scope of work, the cost for delivering the scope of work, the locations for the scope of work, the documents and records exchanged for delivering the scope of work and the risks associated with delivering the scope of work. The hierarchical nature of breakdown structures allows summarizing the detailed project information to the desired level to monitor, evaluate and report the projects performance.

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