What happens when an enterprise-level project comes your way and it's up to you to manage the resources, tasks, and budget, plus ensure the project is completed on time and within scope?
Project management isn't easy. It requires keeping track of many – sometimes geographically dispersed – teams, coordinating tasks, and keeping everyone accountable to a single goal. Fortunately, there are several project management philosophies that can help. And when it comes to large, complex projects, one of the best approaches is work breakdown structure.
What Is Work Breakdown Structure?
Work breakdown structure is a type of project management that offers a visual way to detail the deliverables within a project. It does so by presenting key milestones within a hierarchy that simplifies large projects into smaller, more manageable groups. As a result, work breakdown structure is ideal for complex projects that involve numerous steps and stakeholders.
Notably, work breakdown structure focuses on deliverables rather than the activities required to achieve those milestones.
The work breakdown structure divides all deliverables into sub-deliverables until they are manageable enough that one person can complete them. Each deliverable also gets assigned a budget and time estimate. All these estimates should add up to 100% of the total budget and time allotted for the entire project.
Now that we have the work breakdown structure definition out of the way, let’s dive deeper into the question of “what is work breakdown structure” to understand what it means in practice.
Putting Work Breakdown Structure into Action
A work breakdown structure should display every deliverable for the project in a single, hierarchical graphic. That graphic can be a flowchart, a table, an outline, or anything else that visually represents everything within a hierarchy.
Using a simplified flowchart, a work breakdown structure might look something like this:
This example includes three levels, which is the most common setup. The structure can be extended to four or five levels if needed.
Each deliverable should be a project milestone (e.g. hire contractor, launch product), not specific tasks. The tasks required to meet each deliverable are known as a “work package.”
Finally, each deliverable must have a work and budget allocation. You can also choose to include team assignments and start and end dates for each deliverable.
How to Create a Work Breakdown Structure
There are several ways you can create a work breakdown structure. The lowest tech options are a whiteboard or a wall with sticky notes, but that clearly won’t work for a geographically dispersed team. Go digital with project management software that drives agility across teams, whether in the same room or distributed across the globe.
Work Breakdown Structure Rules
As you get started with work breakdown structure, there are several rules to keep in mind, many of which are covered in the work breakdown structure definition. These rules include:
- 100% Rule: Both the work and budget allotment for all deliverables must always add up to 100% and they must do so in a hierarchical manner. For example, all level two deliverables must add up to 100% of work and budget for the entire project as outlined at level one of the hierarchy. Below that, all level three deliverables must add up to 100% of their parent deliverable. So, if the parent deliverable is 40% of work for the project and $60,000, the sum of all its sub-deliverables must equal 40% of work and $60,000.
- Mutually Exclusive: Every deliverable and sub-deliverable must be mutually exclusive, meaning that no milestone can appear within the work breakdown structure twice. This mutual exclusivity helps eliminate duplicate work, excessive costs, and communication issues since it means that only one team or person is responsible for each deliverable.
- Focus on Outcomes: Once again, it’s important that every deliverable mapped out in the work breakdown structure defines an outcome (aka a milestone), not an action. This rule makes it easier to manage project scope and gives team members working on the project flexibility to complete each outcome as they see fit.
- The 8/80 Rule: The 8/80 rule states that work packages (the work required to complete each deliverable) should not take fewer than eight hours or more than 80 hours (10 days of full-time work) to complete. If the work package will take fewer than eight hours to complete, you can likely combine it with another deliverable. If the work package will take more than 80 hours to complete, you need to break up the deliverable into separate components.
Why Use a Work Breakdown Structure?
Now that you have the complete work breakdown structure, it’s time to review why you should use this approach to project management. Using a work breakdown structure delivers numerous benefits, including:
- Improved planning: Large, complex projects can be difficult to wrap your head around, let alone plan from start to finish. Using work breakdown structure helps improve planning by making it easy to visualize the scope of the project and break it down into more manageable milestones. As a result, work breakdown structure allows you to set clear timelines earlier on, make sure no work gets duplicated or overlooked, and understand the level of output at any point in the project timeline.
- Smarter budget and resource allocation: By improving project planning, work breakdown structure allows for smarter budget and resource allocation. Specifically, it ensures that all budget and time requirements get accounted for at the very beginning of a project. Additionally, the mutually exclusive rule guarantees that no duplicate work will take place, which eliminates wasted budget and time.
- Simplified risk identification: The visual nature of work breakdown structure makes it easier to identify areas of risk so that you can get ahead of problems and remedy them faster.
- Improved accountability: The clear work assignments, timelines, and budgets identified by work breakdown structure improve accountability among team members. That’s because everyone involved should have a clear understanding of what they are responsible for and the time they have to complete that work.
- Enhanced visibility: Finally, work breakdown structure provides a high level of visibility into every project. This visibility makes it easy to communicate expectations to stakeholders and team members and track progress throughout the project.
A work breakdown structure is a helpful method for managing the challenges that accompany large-scale enterprise projects and enjoying successful outcomes.