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PM0010 : List the benefits of WBS? Need for risk management in an organization-comment.

Posted on: February 27, 2012

PM0010 : List the benefits of WBS? Need for risk management in an organization-comment.

Answer: –   WBS :- Work breakdown structure (WBS) is a fundamental component of project management process that helps in defining and organizing the total scope of a project using hierarchical tree structure. According to Project Management Body of Knowledge (PMBoK), ‘WBS is 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’. The hierarchy structure approach of WBS helps the project team to know the requirements of total project more accurately and specifically. WBS can also be used to assign responsibilities and allocate resources to the project. It helps the team to monitor and control the project

WBS is the critical input to various project management processes and deliverables like activity definitions, project schedule network diagrams, project and program schedules, performance reports, risk analysis and response, control tools or project organization. WBS has several levels in its hierarchy structure. These can be further used as an input to the scheduling process that supports elaboration of tasks, activities, resources and milestones which can be cost estimated, monitored, and controlled.

Benefits of WBS

Work breakdown structure represents family tree hierarchy structure of project operations required to accomplish the objectives of the project. Tasks identified in the WBS collectively describe the overall project. It serves to describe the link between the end objective and activities required to reach that objective.

Need for risk management in an organization-comment.

The PMBoK defines risk management as the “formal process by which risk factors are systematically identified, assessed and provided for.” Risk management provides an opportunity and support to an organisation to gain and access better control over various factors of a project. They are:

· Time (planning/scheduling)

· Money estimate

· Quality control

· Information

Risk management helps the organisation to control and monitor various activities in a project. The following points describe the needs of the risk management:

· Promote an uninterrupted progression in the activities carried out within the project by taking appropriate measures, as well as to remove any interruptions as quickly as possible in the event of interrupts in the project.

· Instil confidence in the project team as well as project stakeholders and third parties.

· Promote communication within the entire project team.

· Support the decision making process of a project.

The Risk Management process is a generic guide for any organisation, regardless of the type of business, activity or function. It is an integral part of business planning. It also helps project sponsors and project teams to take informed decisions regarding alternative approaches to achieve their objectives and to reduce relative risk involved, in order to increase the likelihood of success in meeting or exceeding the objectives of the project. Risk management encourages the project team to take appropriate measures to:

· Minimise adverse impact on project scope, cost, schedule and quality.

· Maximise opportunities to improve the objectives of project with lower cost, shorter schedules, enhanced scope and higher quality.

· Minimise management crisis.

The effectiveness of risk management strategies varies for one project to another based on their risk profiles. The following points describe the applicability of different strategy:

For relatively low-uncertain projects, fast decision making can reduce the uncertainties from delays caused by regulatory changes, political changes and economic changes.

For project with high level certainties, purposeful postponement of some commitments and decisions can reduce the risks through acquisition of more and better information that lead to better decisions.

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