Work Breakdown Structure:

A Work Breakdown Structure (WBS) is a fundamental project management technique for defining and organizing the total scope of a project, using a hierarchical tree structure. A well-designed WBS describes planned outcomes instead of planned actions. Outcomes are the desired ends of the project, and can be predicted accurately; actions comprise the project plan and may be difficult to predict accurately.

One of the most important WBS design principles is called the 100% Rule. The 100% Rule...states that the WBS includes 100% of the work defined by the project scope and captures all deliverables – internal, external, and interim – in terms of the work to be completed, including project management. The rule applies at all levels within the hierarchy: the sum of the work at the “child” level must equal 100% of the work represented by the “parent” and the WBS should not include any work that falls outside the actual scope of the project, that is, it cannot include more than 100% of the work… It is important to remember that the 100% rule also applies to the activity level. The work represented by the activities in each work package must add up to 100% of the work necessary to complete the work package.
Figure 1 shows a WBS construction technique that demonstrates the 100% Rule quantitatively. At the beginning of the design process, the project manager has assigned 100 points to the total scope of this project, which is designing and building a custom bicycle. At WBS Level 2, the 100 total points are subdivided into seven comprehensive elements. The number of points allocated to each is a judgment based on the relative effort involved; it is NOT an estimate of duration. The three largest elements of WBS Level 2 are further subdivided at Level 3, and so forth. The largest terminal elements at Level 3 represent only 17% of the total scope of work. These larger elements may be further subdivided using the progressive elaboration technique described above.

A WBS is not a project plan or a project schedule and it is not a chronological listing. It is considered poor practice to construct a project schedule (e.g. using project management software) before designing a proper WBS.