A2Z Bike Shop Project

UCBX470 Project Management August 2007

Jason Hall Kirill Mogilev

Pradeep Mahapatra Galen Middlebrooks

i

Rajesh Shikaram Juveria Aleem

ii

Table of Contents

Contents Project Scope .......................................................................................................................................................... 1 

Vision Statement ................................................................................................................................................. 1 Business Need ..................................................................................................................................................... 1 Project Description .............................................................................................................................................. 1 Project Deliverables (Scope) ............................................................................................................................... 2 Project Objectives ............................................................................................................................................... 2 Assumptions ........................................................................................................................................................ 3 Constraints .......................................................................................................................................................... 3 

Stakeholder Analysis .............................................................................................................................................. 4 Project Lifecycle ..................................................................................................................................................... 5 Work Breakdown Structure .................................................................................................................................... 6 Communications Plan ............................................................................................................................................. 7 Responsibility Assignment Matrix ......................................................................................................................... 8 Project Schedule 12 Cost Baseline ........................................................................................................................................................ 15 Cost Baseline Graph ............................................................................................................................................. 17 Risk Types ............................................................................................................................................................ 20 

High-Level Risks ......................................................................................................................................... 20 Risk Assessment Metric ........................................................................................................................... 20 

Risk Response Plan ............................................................................................................................................... 21 

1

Project Scope

Vision Statement A2Z Bike Shop company aims to set up a network of bike rental shops to promote a healthy lifestyle for the bike riders and offer social and recreational activities by facilitating bike clubs.

Business Need Currently there are very few bay area bike rental shops that provide social and recreational activity. Since the Bay Area is known to be environmentally conscientious, the ‘Shop owner’ Bike Rental shop will provide a modern and unique recreation experience to the consumer. This service will be used to tap a potential market area for generating revenue and setup a successful business.

Project Description • This project will design and build an A2Z Bike Rental franchise bike shop in the bay

area. The shop will meet all specifications of A2Z Bike Rental and will be delivered on time and with budget to the franchisee. The shop will include:

Finished flooring and window coverings HVAC and Utility Systems Retail merchandise display space Bicycle maintenance area Inventory and rental storage areas Conference and multi-purpose rooms Handicap approved restrooms Locker rooms complete with showers Network wiring for entire facility Administrative office space

2

Project Deliverables (Scope)

Is Is Not • Verifying that all

documentation is in place before construction

• Finding the location of the shop

• Verifying that all needed sub-contractors are hired before construction / remodel

• Commercial licensing for the shop, zone compliance and city approvals

• Conducting quality review of sub-contractors

• Negotiating the contract between the A2Z Bikes and franchisee

• Delivering completed bicycle shop to its owner

• Not constructing the building

• Setting up office peripherals or any other operational support, maintenance and security

Project Objectives

Objectives Criteria for Evaluation • Obtain Project Approval • Signed Franchise agreement

• Present charter and project scope

• Review / sign-off by A2Z Bikes and franchisee

• Write Project Plan • Certification by A2Z Bike rep

• Inspect building facility • Sign off on proposed construction bids by stakeholders

• Hire sub-contractors for external / internal remodeling and utilities installation

• Conduct pre-delivery inspection with A2Z representatives and franchisee

• Deliver fully functioning and furnished bike rental facility to the client

• Final building inspection, turning keys over to franchisee

3

Assumptions • All franchise agreements between Shop owner and A2ZBike Shop are signed • Location and property already selected • Funding is established • Design specs from Shop owner are readily available • City approval obtained • Business licenses and permits are acquired • Lease/Rental contract between Shop owner and building owner is completed • Signup for Utilities will be completed by Shop owner

Constraints • Complete project with budget allocated by project sponsor • Weather • Availability of specialized materials, accessories from manufacturers • Labor union/Vendor labor, Skilled/Specialized labor availability issues • Building design and layout must meet bike shop parents specs • Major variations of building layout could affect project schedules • Natural disaster consideration • Finish project by Date xx/yy/07

4

Stakeholder Analysis

Stakeholder Name

Stakeholder Expectations

Bike

Manufacturer (Franchiser)

Engage & participate in review meetings with the project team setting up the bike rental shop. It is expected the manufacturer will choose the location of the shop, provide detailed shop design & has an agreement directly with the shop owner.

Project Team

General contractor specializing in developing bike rental shops. The expectations is to fully manage and develop the bike shop as per the specifications from the franchiser.

Building Leaser/Owner

Co-operation during the development of shop. Provides structure design as input for planning & any approvals required for securing utilities.

Sub-Contractors

Have an agreement with the General contractor and work with the project team to deliver what is expected or agreed upon. Participate in review sessions as expected by Project Team. They do not deal with the bike manufacturer, shop owner or building owner/leaser.

Government Agency

They work with General contractor for all approvals & inspections. They do not deal with the bike manufacturer, shop owner or building owner/leaser.

Shop Owner (Franchisee)

Has an agreement with the Bike Manufacturer. Interfaces with the project team for period inspections & review meetings.

Project Lifecycle

5

6

Work Breakdown Structure 1. Initiation 

a. Obtain Project Approval b. Write Project Charter c. Write Project Plan d. Select Team Members 

2. Planning a. Initial Facilities Inspection b. Verify Permits and Zoning c. Verify Utilities 

i. Gas ii. Electric iii. Sewer 

d. Hire Sub‐Contractors i. Electrical ii. Plumbing iii. Carpentry iv. Interior Design 

3. Execution and Control a. Execute original Project Plan b. Monitor Progress c. Identify and rectify problems d. Control Sub‐Contractors 

4. Review and Evaluation a. Conduct Regular Sub‐Contractors Performance Reviews b. Report on progress to A2Z Bikes and franchisee 

5. Closure a. Verify work completed b. Final walk‐thru with owner and A2Z Bikes c. Turn keys over to owner 

7

Communications Plan

Topic of Communication

Sp

on

sor

Pro

ject

M

an

ag

er

Pro

ject

Team

Su

b-

Co

ntr

act

or

Fra

nch

iser Frequency Method of

Communication Method of Delivery

Project Charter O I once meeting/email Word Project Scope S O O once meeting/email Word WBS S O O once meeting/email Word Project Schedule

S O I I ongoing meeting/email MS Project

Cost Baseline S O once meeting/email Word Risk Plan R O ongoing meeting/email Word Status Report (includes weekly meeting minutes)

R O I I weekly email

Word

Sub-contractor Proposals and Coordination

S,O,R

S,O,R

weekly

Quality Inspection Report

O O S Milestone based

meeting/email

Word

Safety Certification

O O S once email

Word

Lessons Learned

O I once email Word

KEY: O = Owner I = Input R = Reviewer S = Sign off

Responsibility Assignment Matrix

8

9

10

11

12

13

14

15

Cost Baseline

Task Duration  Days  Daily Rate  Misc. Cost  Total Cost 

Phase 1 – Project Initiation Obtain Project Approval  2 $600.00  $1,200.00 Write Project Charter  5 $600.00  $3,000.00 Write Project Scope  5 $600.00  $3,000.00 Project Scope Review  3 $600.00  $1,800.00 Project Scope Approval  1 $600.00  $600.00 Write Project Plan  5 $600.00  $3,000.00 Identify & Define Resources  5 $600.00  $3,000.00 Phase 1 Totals:  26 $15,600.00 Phase 2 ‐ Project Planning Initial Building Inspection  3 $800.00  $500.00   $2,900.00 Verify Permits and Zoning  2 $600.00  $1,200.00 Verify Utilities  5 $600.00  $3,000.00 

Solicit / Review Sub‐Contracting Bids  5 $600.00  $3,000.00 Hire Sub‐Contractors  3 $600.00  $1,800.00 Phase 2 Totals:  18 $11,900.00 Phase 3 – Construction Structural Modifications  21 $1,000.00  $10,000.00   $31,000.00 Build out Retail Area  90 $1,800.00  $10,000.00   $172,000.00 Build out Service Area  60 $1,800.00  $10,000.00   $118,000.00 Build out Storage Area  30 $1,800.00  $5,000.00   $59,000.00 Build out Conference Area  45 $1,800.00  $5,000.00   $86,000.00 Build out Locker Rooms  45 $1,800.00  $10,000.00   $91,000.00 Build out Admin. Offices  21 $1,800.00  $5,000.00   $42,800.00 Build out Storefront  14 $1,800.00  $5,000.00   $30,200.00 Build out Receiving Station  14 $1,800.00  $2,000.00   $27,200.00 Build out Outdoor Facilities  14 $2,000.00  $2,000.00   $30,000.00 Phase 3  Totals  354 $687,200.00 Phase 4 – Review and Evaluation Contractor Reviews  45 $600.00  $27,000.00 Stakeholder Progress Reports: 

25% Completion  7 $600.00  $4,200.00 50% Completion  7 $600.00  $4,200.00 75% Completion  7 $600.00  $4,200.00 

100% Completion  7 $600.00  $4,200.00 Completion of Scope Verification  7 $900.00  $6,300.00 Phase 4 Totals:  80 $50,100.00 

16

Task Duration /Days  Daily Rate Misc. Cost  Total Cost 

Phase 5 ‐ Project Closure Pre‐Delivery Inspection  3 $900.00  $2,700.00 Stakeholder Inspection  3 $1,000.00  $3,000.00 Turn over store to Franchisee  1 $1,000.00  $1,000.00 Phase 5 Totals:  7 $6,700.00 

Project Grand Total:  $771,500.00 

Cost Baseline Graph

Phase 1-Project Iniiation

$-$500.00

$1,000.00$1,500.00$2,000.00$2,500.00$3,000.00$3,500.00

Obt

ain

Pro

ject

App

rova

l

Writ

eP

roje

ctC

harte

r

Writ

eP

roje

ctS

cope

Rev

iew

of

Pro

ject

Sco

pe

App

rova

l of

Pro

ject

Sco

pe Writ

eP

roje

ctP

lan

Def

ine

&Id

entif

yR

esou

rces

Task

Cos

t

Phase 2-Planning

$-$500.00

$1,000.00$1,500.00$2,000.00$2,500.00$3,000.00$3,500.00

InitialBuilding

Inspection

VerifyPermits and

Zoning

VerifyUtilities

Review Bidsof Sub-

Contractors

Hire Sub-Contractors

Task

Cos

t

17

Phase 3-Construction

$-$20,000.00$40,000.00$60,000.00$80,000.00

$100,000.00$120,000.00$140,000.00$160,000.00$180,000.00$200,000.00

Structu

ral M

odific

ation

Build o

ut of

Retail A

rea

Build o

ut of

Service

Area

Build o

ut of

Storag

e Area

Build o

ut of

Confer

ence

Area

Build o

ut of

Lock

er Roo

ms

Build o

ut of

Admin

office

s

Build o

ut of

storef

ront

Build o

ut of

reciev

eing s

tation

Build o

ut of

outdo

or fac

ilities

Task

Cos

t

Phase 4-Review

$-$5,000.00

$10,000.00$15,000.00$20,000.00$25,000.00$30,000.00

Con

duct

Con

tract

orR

evie

ws

Pro

gres

sR

epor

ts T

oS

take

hold

ers

25%

com

plet

ion

50%

com

plet

ion

75%

com

plet

ion

100%

com

plet

ion

Ver

ifyC

ompl

etio

nof

Sco

pe

Task

Cos

t

18

19

Phase 5-Project Closure

$-$500.00

$1,000.00$1,500.00$2,000.00$2,500.00$3,000.00$3,500.00

Conduct Pre-DeliveryInspection

Inpection by Stakeholders Receipt of keys andturnover

Task

Cos

t

20

Risk Types

High-Level Risks • Project Risks

– Cost Risk – Scope Risk – Schedule Risk – Project Management & Organizational

• External Risks – Vendor Risk – Liability Risk - Safety Risk & Regulatory Compliance Risk – Force Majeure – Earthquakes, Floods, etc

• Qualitative Risks Assessment – Cardinal Scales : For Impact of Occurrence, Ex: 0 to 10 – Ordinal Scales : For Impact on Project, Ex: Low, Medium & High

• Strategies for Threats – Avoidance – changing plan to eliminate the risk – Transference – shifts consequence of a risk to a third party, including

ownership – Mitigation – reduces probability and/or consequences of an adverse risk to

acceptable level – Acceptance – risk is assumed. Contingency plan may be developed or team

may deal with the risk only at the time of occurrence

Risk Assessment Metric

Assessment

Probability

High > 50%

Medium 25% - 50%

Low < 25%

21

Risk Response Plan

No. Risk Description Area Probability of Occurrence

Impact on Project

Priority Strategies A/T/M/Acc

Owner Status

1 Permits

Schedule High High 1

Avoidance by getting appropriate permits on time

PM Open

2 Project Cost Overrun Cost High Medium 2

Avoidance by following best practices and weekly meeting. Mitigation through Scope re-assessments

PM Open

3 Project Scope Creep Scope High Low 3

Mitigation – thorough regular assessments & Change Control

PM Open

4 Sub-Contractor’s delays with specialized parts/equipments

Schedule Low High 4

Mitigation - Negotiate with alternate preferred Sub-Contractor’s . Use influence to acquire parts & expedite execution

PM Open

5 Sub-Contractor’s actual price is more than estimated price

Cost Med Medium 5

Mitigation – Scrutinize the Sub-Contractor’s quote carefully before contract

PM Open

22

signatures. Monitor billed Invoices on a regular basis. Renegotiate

No. Risk Description Area Probability of Occurrence

Impact on Project

Priority Strategies A/T/M/Acc

Owner Status

6 Vendor project execution delays

Schedule 8 Medium 6

Avoidance by using Best Practices for construction/execution Transference – by shifting ownership to Vendors

PM Open

7 Sub-Contractor’s goes out of business before project completion

Schedule Low Medium 7

Mitigation – Negotiate with alternate preferred Sub-Contractor’s

PM Open

8 Resource re-Allocation/Hiring

PM & O Low Medium 8

Avoidance by buy-in from Managers Mitigation by closely monitoring progress

PM Open

9 Project funding - reallocated to some other project

Cost Low High 9 Acceptance Sponsor Open