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Project planning

 
Accounting Dictionary: Project Planning

Making planning decisions for capital investments, many of which may extend over long periods. For example, the decision to buy a particular piece of machinery and equipment is the result of project planning. Project planning has long-term effects on the company's future profitability. Capital Expenditure analysis or Cost-Benefit Analysis is a technique needed for project planning. See also Capital Budgeting.

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Project planning is part of project management, which relates to the use of schedules such as Gantt charts to plan and subsequently report progress within the project environment.[1]

Initially, the project scope is defined and the appropriate methods for completing the project are determined. Following this step, the durations for the various tasks necessary to complete the work are listed and grouped into a work breakdown structure. The logical dependencies between tasks are defined using an activity network diagram that enables identification of the critical path. Float or slack time in the schedule can be calculated using project management software[2]. Then the necessary resources can be estimated and costs for each activity can be allocated to each resource, giving the total project cost. At this stage, the project plan may be optimized to achieve the appropriate balance between resource usage and project duration to comply with the project objectives. Once established and agreed, the plan becomes what is known as the baseline. Progress will be measured against the baseline throughout the life of the project. Analyzing progress compared to the baseline is known as earned value management.[3]

The inputs of the project planning phase include Project Charter and the Concept Proposal. The outputs of the Project Planning phase include the Project Requirements, the Project Schedule, and the Project Management Plan.[4]

See also

References

  1. ^ Harold Kerzner (2003). Project Management: A Systems Approach to Planning, Scheduling, and Controlling (8th Ed. ed.). Wiley. ISBN 0-471-22577-0. 
  2. ^ Richard H. Thayer, Edward Yourdon (2000). Software Engineering Project Management (2nd Ed. ed.). Wiley-IEEE Computer Society Press. ISBN 0-8186-8000-8. 
  3. ^ Fleming, Quentin (2005). Earned Value Project Management (Third Edition ed.). Project Management Institute. ISBN 1-930699-89-1. 
  4. ^ Filicetti, John, Project Planning Overview, PM Hut (Last accessed 8 November 2009).

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Accounting Dictionary. Dictionary of Accounting Terms. Copyright © 2005 by Barron's Educational Series, Inc. All rights reserved.  Read more
Wikipedia. This article is licensed under the Creative Commons Attribution/Share-Alike License. It uses material from the Wikipedia article "Project planning" Read more