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Disclosure: This is a complete made case with made-up numbers. The only purpose of this article is to help readers (non-technical, non-project professionals, beginner) understand key concepts of a project. This is a very simplistic view of the project therefore take it as a pinch of salt and do not assume that project management is so simple. I am not from the construction industry but this is a domain where most of us can relate to a greater extent and hoping most of the readers will be able to relate to the concepts. In the project life cycle, we come across many terminologies which are confusing for many of the beginners. I wish I could make some of these concepts clear to the readers of this article.

Problem Statement

You (customer) are living in a compact apartment in a city where space is a big problem. You cannot do parties at your home with your friends. There is too much traffic jam and if you want to move out of the city at the weekends you have to struggle 3 hours in traffic to go out. The cost of living is very high i.e. rent of the apartment, cost of water, electricity, security, parking, food, vegetables and transport, etc. The cost of constructing or buying a new good house is also very high. Many of your friends who live in this city including you have a hobby of playing football but we cannot play the game because there is no football ground with city range. Every day you have to travel two hours to reach your office.

The benefit of the Existing System

It is close to the airport, railway station and shopping malls. 24 hours water and electricity supply. School of children is near and the bus comes for pick up and drop.

High-Level Want

The customer has Rs 5 Cr. budget for this project. S/He wants 8 bedrooms 2 story luxury building with ample open space, trees, and a garden. The customer likes apples, strawberries garden so would love to have a small orchid.

Wants is like a wish. Because of many technical, procedural, legal, financial, etc reasons,** those may not be possible to implement at the place of project location or in the project’s product.** From our day to day life we know no matter how many resources we have all the wishes cannot be fulfilled.

Project Scope

Getting a new house for a family of 4 people. It may be an apartment, independent bungalow within the city range.

Scope helps project team in giving overall direction in terms of project’s product. It also need to draw a virtual boundary so that project team knows clearly what is within the boundary of a project or what is outside of the boundary.

High-Level Customer Need/Requirement

The customer has 2 kids who are studying in class 10 and 12. A house is required where they can study well, pursue their hobbies. A place where s/he can have weekend parties with his family members and friends. A footwall ground where s/he can play with his friends at the weekends. House should have 24 hours water and electricity supply. Every house member wants to have his personal car so there should be a good enough place for parking. The customer’s spouse is fond of flowers and gardening so there should be a flower garden. The customer is fond of reading books and watching movies, therefore, he needs a home theatre and a book library, for party time we need a hall or covered green space. Sometimes s/he has 5 family friends at my home and it becomes very difficult to adjust them in this apartment so a new place should have enough place to take care of these things.

Requirements are the features or function which a product must have implemented. The complete absence of a requirement from a project is considered incomplete implementation and leads to customer dissatisfaction. Requirments are driven from the scope and wants.

Type of Requirements

Broadly requirements are of two types functional requirements and non-functional requirements. Functional requirements are the behavioral feature of a product. For example, the main gate door should be a sliding door. It should open automatically without any manual intervention. A person should be allowed or not inside the building is approved by the security system.

Nonfunctional requirements are other than functional requirements. Liker performance, compatibility, quality, aesthetic etc. A gate should open within 30 sec after a person come on the gate, it should close automatically within 2 sec. Keeping the same security system if we want to replace the gate at any point of time in the future then it should not cause any portability issue or unknown security threat.

Requirement Elicitation (RE)

Requirement elicitation is a process in which the project team wants to understand the requirements in more detail. This may start from the problem statement or ambiguous/unclear requirements or board requirements. There are many methods of doing RE in the example below we are using written question-answer.

Question Answer
What are the hobbies of your children? Badminton, Chess.
Do you need parking space for your guests? If yes then how many car parkings are required? 10 Open Car Parking for Guests
If the land where you are going to build this house is not suitable for apples or strawberries then will you prefer another type of tree in the garden or not? If yes then what are the other options. Only Mango and Guava
Do you expect from us to plant these trees for you? Yes
What kind of flowers do you want in the garden? Rose & gold marry
Do you want us that we should give you a house with the planted tree or you want to get it done by somebody else? You can do that.
You need 24 water supply? Do you need water tank? Yes. What size? You can calculate the water need of average six people in house. 3 days reserve is enough.
You need 24 electricity, do you prefer generators or a solar plant? How much backup required? Should support 36 hours power cut in the complete home.

Requirement Clarification Questionnaire

Requirement Analysis & RTM

During the planning, execution, testing (verification/ validation) phase of the project, it is important for any project team that the team remain aligned to customer requirements and the customer’s objective behind the project. Hence, they need to track the requirements across different phases of the project. For doing that they need to analyze the requirements and create a unique list of requirements.

The requirement traceability matrix is a table that has Requirement ID, Requirement Name, Requirement short description in the first few columns. The remaining columns of this table are different phases of the project through which a requirement needs to be converted into an accepted feature. An example of a unique list of requirements for our project can be as below.

  1. 2 Bedroom / Study Room for Kids
  2. One Master Bedroom
  3. 5 Bedrooms for Guests
  4. 1 Open Party Hall
  5. 1 Room for Indoor Games
  6. 1 Hall for badminton
  7. 1 Lawn with Rose and Gold Marry Flowers
  8. 1 Orchid of Apple/Guava
  9. 1 Small Footwall Ground
  10. 4 Car covered parking + 10 Open Car Parking Space.
  11. 24 hours water and electricity
  12. Good connectivity to airport, railway station
  13. Near to School of Children and Near to Office
  14. 1 Home theatre
  15. 1 Solar plan
  16. 20K Liter water tank

The requirement list should not have a requirement that can be tested. For example requirements # 12, 13 in the above list cannot be tested because of their subjectivity.

Req. ID Req. Name Req. Description (Req Doc. Section #) Design Section # Resources acquired Work Status Accepted by Customer
4 Open Party Hall FS Doc 1.5 Design Doc Section 1.2 Yes Tested Yes

Requirement Traceability Matrix

Specifications & Constraints

There are two types of specification A- Functional Specifications B- Technical specification. In a bigger project, they are part of 2 separate documents. Function specification document can have multiple names like FRS (Functional Requirement Specification) Document, SRS (System Requirement and Specification Document), Requirement Document. The name of the document depends upon the industry and company procedures. The technical specification also a kind of requirement document from the customer side. It can define the dimensions, quality of material, machine to be used, etc. The technical specification also imposes technical constraints on the project and while developing a product the project team cannot go beyond the technical specs mentioned by the customer.

  1. Bedroom min size should be 15’X18’
  2. Each parking lot should be able to adjust car like Toyota Innova
  3. The football ground can be a community ground.
  4. House should not be too far away from the city, because of customer’s friend are in the city.
  5. The chess room size should be 8’X8’
  6. Apple or Guava garden should be half acre
  7. Rose & Gold marry flower lawn should be in .5 acre
  8. The orchid and flower garden should have a deep irrigation facility.
  9. The Party hall should be able to accommodate 500+ people at a time.
  10. Theatre should be able to adjust 50+ people at ease and it should be 30’X60’
  11. No land should be utilized for solar plan
  12. The water tank should not be put on the roof of the house

Material Specification

Material is the resources that are consumed in the project and during product development, it becomes part of the product. For example, cement or steel is a material resource in construction projects but JCB or Tracker used is a machine resource. In the software development business software tools which you use for development are called development tools like machine resources discussed earlier. But the licenses of the software which we purchase from the market and shipped along with the developed product are material resources.

Once we have functional requirements, technical requirements in place then using technical expertise we can determine what kind of material is required. Some of the material may be common and for that detailed FRS is not required. The material specification can be part of a technical specification or a separate document. For our example project, we can use the following questionnaire to get the answer from the customer.

  1. Question: What kind of cement should be used?
  2. Question: What is the major material of the building?
    1. Is this a steel and glass building?
    2. Is this building mainly made on pillars?
    3. Is this building made of cement bricks?
    4. Does this building have an external structure made of steel and internal everything is made of tough glass?
  3. Question: What kind of brick/glass/ steel should be used for walls/pillars?
  4. Question: What kind of security technology you need in a house?
  5. Question: What kind of mud should be put on the lawn of flowers?
  6. Question: What kind of tiles you want on the floor?
  7. Question: What kind of paint you want on the wall?
  8. Question: What kind of material should be used for electricity fitting?
  9. Question: What kind of plumbing fitting you want?


We need to estimate the quantity of each resource required, estimate the cost of each resource, estimate the time required to complete each milestone or work package. For example, for our project we need estimate following

  1. Bill of Material (the type of material required)
  2. Estimate the amount of material required
  3. Estimate the cost of material
  4. Estimate the land/Space required

What is the Cost

There are two viewpoints of the cost customer viewpoint and vendor viewpoint. From a vendor viewpoint, the cost is the money that a vendor spends during the complete project lifecycle to complete various project activities. From the customer’s viewpoint, the cost of the project is money that he pays to the vendor. It is also called price, which a vendor charges to a customer. Project cost can have the following components.

  1. Cost of the raw material used for construction
  2. Cost of efforts or cost of services. Like Consultant, Architect, Labor, Painter, Plumber, Electrician, etc.
  3. Cost of machines used.
  4. Cost of transportation
  5. Cost of money for government approval
  6. Cost of capital. Cost of the money which you borrowed to make the payment during a project.

In a construction project, BOM (bill of material) is a good tool to generate high-level cost estimates

Project Pricing

In FFP (firm fix price) project complete cost of the project need to be estimated in the advance. This cost needs to be communicated to the customer. Based on this cost customer makes the decision to spend money on the project or not. This is one of the critical inputs for customers for ROI (return on investment) decisions. In other kinds of variable cost projects as well, customers want to know a ballpark estimate that can help them in making a decision.

When vendor quotes a price to the customer it includes following components.

  1. Cost as discussed earlier
  2. Risk Management Cost
  3. Profit Margins

Project Architecture, Design, Drawing

Depending upon the industry different kinds of architecture are developed to understand how the product can be developed? How the product will be used (functional design)? How it will look (UI Design)? How the overall security of the product looks like and how it will be maintained (Security Architecture)? How an optimal performance can be achieved and how it can be maintained (performance architecture). There are many other kinds of design and architecture.

For our construction project, we can draw a high-level diagram based on the requirements, elicited requirements, and detailed specifications. In construction, you call it drawing, architecture, etc., depending upon what level is detailed on the paper. It shows the position of the entrance, doors, windows, water tank, different rooms, connectivity, place and garden, place of lawn, football field, party room, the position of CCTV, security camera, biometric readers, theater, etc. Different kinds of architecture, drawing, and design need to be developed to visualize the overall project. In the construction industry, many times all these documents are called by engineers as a project plan. But that is an incorrect name for the architecture or drawing documents.

Some features of architecture/design are

  1. Even if you change the underlying technology for development, this architecture will not change. For example, if you use different CCTV technology for surveillance overall security architecture remains the same.
  2. Even if you do not know the detailed requirements a high-level architecture can be build from the given high-level requirement.
  3. High-level architecture helps us in the initial estimate.


After preparation of architecture, design, draft documents we have a blueprint of the project before us. Technology selection is part of the design but we buy technology and using technology for developing a product of the project during the development/construction. In the project lifecycle if the technology does not fit or becomes obsolete or becomes expensive then technology alternatives need to be evaluated. While selecting alternative technology we need to ensure that the architecture of the product does not change or change the least.

Technology for executing a project like machines used for digging, mixing, creating pillars, etc. and technology which is part of the product architecture like security systems, elevators in the building, sewage treatment, water purifier, electricity generation, etc. both need to evaluated based various parameters like cost, availability, each of maintenance, ease of scale, etc. then selected.

Low-Level Design & Implementation

A project has many characteristics like technology stability and maturity, requirement stability, market competition, availability of the resource required, company culture, bureaucratic processes, alternative technologies, time to market, budget for development, budget for research, need of research, etc. Based on the project characters we need to select a project management methodology. Broadly there are two types of methodologies A- Waterfall, which is suitable when all project characteristics are predictable and fixed. B- Agile, which is suitable when any of the project characteristics are not fixed or can change during the project cycle.

Whatever project management methodology we chose, will have the most impact on the release/ delivery/ milestone of the project. The agile methodology relies on frequent delivery and the waterfall relies on big bang one-time delivery. Agile delivery is iterative and sometimes these iterations are called a sprint. Depending upon the domain of the project iterative may be different, but the focus is we should deliver something which customers can see and value.

For example in our construction project sprint or iteration can be like as below.

Sprint1: Land Identification

As per your requirements, we need 10-acre land which we have identified for you at 20 KM away from the main city. Please look, approve and sanction money for the registration.

Sprint 2: Architecture

The project team and consultants created architecture, design, drawing in the sprint. The blueprint is reviewed with the customer and approval is taken.

Sprint 3: Water Tank

We are going to build a tank first because water is necessary for construction.

Detail requirement of the tank (In Agile Methodology Detail Requirement is not documented earlier but just before the work need to done.)

It should be circular, at the height of 20 meters. Should be made of such a material that water does not become hot even in extreme summers because during summer the temperature goes to 45°C. It should be able to hold borewell water and municple corporation water in different compartment.

Detail Design of the tank

Construction of the tank

Product Demo/Review: Review the function and quality of completed tank


In the article, we tried to understand Project Management and related terminologies using a construction industry example. We know in real-life things do not happen in this simplistic way but to explain the high-level concepts we have taken the shortest route and avoided extra complications. If you are moving into project management then you must have got some idea from this article. If you are experienced but do not these terminologies then you may have understood the subtle difference between different terms. If I forgot to mention anything important and you feel it is important to add then please feel free to add that in the comment box below. If required, based on your feedback I will improve this article.