Estimating Threshold

When you create a schedule you generally don’t know enough to enter all of the detailed activities the first time though. Instead, you identify large chunks of work first, and then break the larger chunks into smaller pieces. These smaller pieces are, in turn, broken down into still smaller and more discrete activities. This technique is referred to as creating a Work Breakdown Structure (WBS).

An appropriate question to ask is how small the activities should be before they do not need to be broken down further. This is referred to as your “estimating threshold”. Work can be broken down into smaller activities than the estimating threshold, but normally no work would be left at a higher level. The threshold can be different based on the size of your project and how well the work is understood.

You can use the following criteria as a guide. For a typical large project (say 5000 effort hours or more), any work that is greater than 80 hours of effort should be broken down into smaller pieces. Medium-sized projects (say 1000 effort hours) should have activities no larger than 40 hours. If the project is small (say 200 hours), you should break down the activities into work no greater than 20 hours. Remember that this threshold is an upper limit. You can break the activities down further if you want.

Assigning work that is smaller then your threshold allows the work to be more manageable. This is because when you assign work to a team member you don’t know for sure how he is progressing until the due date (or the completion date if it comes first). For instance, if you assign a team member a piece of work that is due in four weeks, you are not going to know for sure whether the work is on time until the four-week deadline. If the work is completed you will know you are on track. If the work is late you will know it then as well. However, four weeks (or longer) is too long to wait to know if the work is on track. A better approach is to break the four-week activity into four one-week activities. Then you will know after the first week if the work is on time or not.

Of course, it is possible that activities that are to be worked on in the distant future may not be able to be broken down less than the threshold because there may be too much that is unknown about the work itself. The future work can be left at a level higher than the threshold. However, if you leave future work at a high-level, it is still critical to break the work into smaller pieces at least two to three months before you need to start executing the work.

In addition to allowing you to manage the work more effectively, another reason to break down activities into smaller pieces is to make sure that you understand what the work means. When you assign a team member an activity from the schedule, he may not understand what the work is and he may ask you for an explanation. If you don’t know what the work means either, you will be in trouble. So, you should make sure that the work is broken down into a level small enough so that the activities are understandable. For instance, if an activity that is estimated at 80 hours has never been done before, it may still need to be broken down into smaller activities to ensure that the team member that is assigned the work knows exactly what is expected.

These two factors – the ability to manage the work effectively and to understand the work required – should drive your decision on how small to make your activities.

Duration Threshold

In general (but not a hard and fast rule), the duration of activities should be broken down to a level that is no more than twice the project team reporting cycle. For instance, if you are receiving a formal status update from your team every week, the duration threshold should be no more than two weeks. Or, if you have a status meeting weekly, the assigned activities should be no more than two weeks. This rule ensures that there will be no more than two status periods before an activity is completed or is flagged as late. As an example, if you meet with your team weekly and the activity duration is no more than two weeks, then no activity will be active for more than two status meetings before it is completed or late. On the other hand, if you have an activity that has a duration of five weeks, it is possible that up to five status meetings will go by before you know for sure whether the activity will be completed on schedule. This is an example of where the activity needs to be broken down at least one more level. Smaller activities allow problems to be uncovered and fixed much earlier.

The reverse of this situation is true as well. Let’s say you have broken down a 200 hour activity into four smaller activities – each of which is less than 80 hours. However, when you are ready to assign the work, you assign it to a team of three people. In this case, the 80 hour threshold would be too short. Instead, you could roll the four smaller activities back up to the 200 hour summary activity. Since there are three people on this team, they can still get this 200 hour activity completed within two weeks.

Note that duration threshold comes into play when the schedule is finalized and not when the WBS is created. When the WBS is created you only know the estimate of the effort hours. After the resources are applied, you can validate that the duration threshold has been met.



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