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Many organizations today have a new or renewed
interest in project management.
◦ The U.S. spends $2.3 trillion on projects every
year, or one-quarter of its gross domestic product,
and the world as a whole spends nearly $10 trillion
of its $40.7 gross product on projects of all kinds.*
◦ In 2006, the average senior project manager in the
U.S. earned over $104,000 per year.**
◦ Project management certification is popular
worldwide.
*PMI, Inc., The PMI Project Management Fact Book, Second Edition, 2001.
**PMI, Inc., Project Management Salary Survey, Fifth Edition, 2007.
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A 1995 Standish Group study (“The CHAOS
Report”) found that only 16.2 percent of
information technology (IT) application
development projects were successful in meeting
scope, time, and cost goals. Over 31 percent of
the projects were canceled before completion,
costing over $81 billion in the U.S. alone.
A 2004 PricewaterhouseCoopers study of 200
companies from 30 different countries found that
over half of all projects fail.
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Better control of financial, physical, and human
resources
Improved customer relations
Shorter development times
Lower costs
Higher quality and increased reliability
Higher profit margins
Improved productivity
Better internal coordination
Higher worker morale
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A project is “a temporary endeavor undertaken
to create a unique product, service, or result.”*
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Operations is work done to sustain the business.
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Projects end when their objectives have been
reached or the project has been terminated.
*Project Management Institute, Inc., A Guide to the Project Management Body
of Knowledge (PMBOK® Guide, Third Edition) (2004), p. 5.
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A young couple hires a firm to design and build them a
new house.
A college campus upgrades its technology
infrastructure to provide wireless Internet access.
A group of musicians starts a company to help children
develop their musical talents.
A pharmaceutical company launches a new drug.
A television network develops a system to allow
viewers to vote for contestants and provide other
feedback on programs.
A government group develops a program to track child
immunizations.
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A project:
◦ Has a unique purpose.
◦ Is temporary.
◦ Is developed using progressive elaboration or in an
iterative fashion.
◦ Requires resources, often from various areas.
◦ Should have a primary customer or sponsor.
 The project sponsor usually provides the direction and
funding for the project.
◦ Involves uncertainty.
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Every project is constrained in different ways by
its:
◦ Scope: What work will be done as part of the project?
What unique product, service, or result does the
sponsor expect from the project?
◦ Time: How long should it take to complete the project?
What is the project’s schedule?
◦ Cost: What should it cost to complete the project?
What is the project’s budget?
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It is the project manager’s duty to balance these
three often competing goals.
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It may be good enough to hit the target, or range,
of triple constraint goals, but not the bull’s-eye.
It’s important to determine which aspects of the
triple constraint are the most important.
The “quadruple constraint” includes quality as
well as scope, time, and cost.
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Project management is “the application of
knowledge, skills, tools, and techniques to project
activities to meet project requirements.”*
*Project Management Institute, Inc., A Guide to the Project Management Body
of Knowledge (PMBOK® Guide, Third Edition) (2004), p. 8.
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Stakeholders are the people involved in or
affected by project activities.
Stakeholders include:
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The project sponsor
The project manager
The project team
Support staff
Customers
Suppliers
Opponents to the project
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Four core knowledge areas lead to specific project
objectives.
◦ Project scope management involves defining and managing
all the work required to complete the project successfully.
◦ Project time management includes estimating how long it will
take to complete the work, developing an acceptable project
schedule, and ensuring timely completion of the project.
◦ Project cost management consists of preparing and managing
the budget for the project.
◦ Project quality management ensures that the project will
satisfy the stated or implied needs for which it was undertaken.
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Four facilitating knowledge areas are the means through
which the project objectives are achieved.
◦ Project human resource management is concerned with
making effective use of the people involved with the project.
◦ Project communications management involves generating,
collecting, disseminating, and storing project information.
◦ Project risk management includes identifying, analyzing,
and responding to risks related to the project.
◦ Project procurement management involves acquiring or
procuring goods and services for a project from outside the
performing organization.
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One knowledge area (project integration management)
affects and is affected by all of the other knowledge areas.
All knowledge areas are important!
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Project management tools and techniques assist project
managers and their teams in various aspects of project
management.
Note that a tool or technique is more than just a software
package.
Specific tools and techniques include:
◦ Project charters, scope statements, and WBS (scope)
◦ Gantt charts, network diagrams, critical path analyses (time)
◦ Net present value, cost estimates, and earned value
management (cost)
◦ See Figure 1-4 for more examples
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“Super tools” are those tools that have high use
and high potential for improving project success,
such as:
◦ Software for task scheduling (such as project
management software)
◦ Scope statements
◦ Requirements analyses
◦ Lessons-learned reports
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Tools already extensively used that have been
found to improve project importance include:
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Progress reports
Kick-off meetings
Gantt charts
Change requests
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What Went Right? Improved
Project Performance*
The Standish Group’s CHAOS studies show improvements
in IT projects in the past decade
Measure
Successful Projects
Failed Projects
Money wasted on
failed and
challenged projects
1994 Data
16%
31%
$140B out of
$250B or 56%
2006 Data
35%
19%
$53B out of
$346B or 15%
Result
More than doubled
Almost halved
Well more than
halved
*Jim Johnson, “CHAOS 2006 Research Project,” CHAOS Activity News, vol. 2: issue 1, (2007).
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“The reasons for the increase in successful
projects vary. First, the average cost of a project
has been more than cut in half. Better tools have
been created to monitor and control progress and
better skilled project managers with better
management processes are being used. The fact
that there are processes is significant in itself.”*
*The Standish Group, “CHAOS 2001: A Recipe for Success” (2001).
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There are different ways to define project
success:
◦ The project met scope, time, and cost goals.
◦ The project satisfied the customer/sponsor.
◦ The project produced the desired results.
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A program is:
◦ “a group of related projects managed in a coordinated
way to obtain benefits and control not available from
managing them individually.”*
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A program manager provides leadership and
direction for the project managers heading the
projects within the program.
*Project Management Institute, Inc., A Guide to the Project Management
Body of Knowledge (PMBOK® Guide, Third Edition) (2004), p. 8.
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Project portfolio management is an emerging
business strategy in which organizations group and
manage projects and programs as a portfolio of
investments that contribute to the entire enterprise’s
success.
Pacific Edge Software’s product manager, Eric
Burke, defines project portfolio management as “the
continuous process of selecting and managing the
optimum set of project initiatives that deliver
maximum business value.”*
*Eric Burke, “Project Portfolio Management,” PMI Houston
Chapter Meeting (July 10, 2002).
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Project, program, and portfolio managers need
to develop specific skills.
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Certification is available for project managers.
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There are many software tools to assist in
project, program, and portfolio management.
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Knowledge of the following:
◦ All nine project management knowledge areas
◦ The application area, including specific standards and
regulations
◦ The project environment
◦ General management
◦ Human relations
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Leadership and
professionalism are
crucial.
Know what your
sponsor expects from
the project, and learn
from your mistakes.
Trust your team, and
delegate decisions.
Know the business.
Stand up for yourself.
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Be a team player.
Don’t be overly emotional
and stay organized.
Work on projects and for
people you believe in.
Think outside of the box.
Some luck is involved in
project management, and
you should always aim
high.
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Effective project managers provide leadership by
example.
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A leader focuses on long-term goals and bigpicture objectives while inspiring people to reach
those goals.
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A manager deals with the day-to-day details of
meeting specific goals.
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Project managers often take on the role of both
leader and manager.
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Large projects: leadership, relevant prior
experience, planning, people skills, verbal
communication, and team-building skills are most
important
High uncertainty projects: risk management,
expectation management, leadership, people
skills, and planning skills are most important
Very novel projects: leadership, people skills,
having vision and goals, self-confidence,
expectations management, and listening skills are
most important
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PMI provides certification as a Project
Management Professional (PMP).
A PMP has documented sufficient project
experience, agreed to follow a code of ethics, and
passed the PMP exam.
The number of people earning PMP certification is
increasing quickly.
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Ethics — a set of principles that guide our
decision making based on personal values of what
is “right” and “wrong” — is an important part of all
professions.
Project managers often face ethical dilemmas.
In order to earn PMP certification, applicants must
agree to the PMP code of ethics and professional
conduct.
Several questions on the PMP exam are related to
professional responsibility, including ethics.
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