Work Breakdown Structure (WBS) is the most important project management tool. WBS captures the entire project scope of work in a very objective fashion. A well designed WBS, guides the project team to do project planning, project execution and project control effectively.
Usage of WBS:
•Planning and budgeting •Scheduling •Estimating costs •Analyzing cost drivers •Identifying risks •Making resource assignments •Measuring and controlling performance •Configuration management •Communicating with the customer and other key stakeholders (especially about scope) •Does NOT describe work at the smallest sub-tasks
Big project work is systematically decomposed into smaller and more manageable components. The WBS looks like a tree structure. The decomposition continues till the level where the project team and SMEs feel that work at that level can be managed well.
Work items at the lowest level of WBS are called as a Work Package. A Work Package can be accurately scheduled and cost estimated, unambiguously allocated, properly tracked and monitored. Although there is no rule as to how big a work package should be, but there are some thumb rules which suggest that work packages should be just big enough to be completed in a single review period. i.e. 80 hours.
The details of work packages are captured in a separate document called WBS Dictionary. WBS can be depicted in either a graphical format or in an indented fashion. Both have their unique usage. While a graphical format WBS is very useful for discussion with stakeholders, an indented WBS is very useful to discuss with team members.
All work packages which are part of the project, must be captured and included in the WBS. Anything which is there in WBS is part of scope of work and anything which is not there in WBS is not part of project scope of work.