MDP 3310
Project Planning and Economics
Lecture #2
Project Planning –project manager and team, organization structures,
and motivation Scope Statement and Work Breakdown Structure
Today’s lecture
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2
The main tasks and responsibilities of a
project manager.
Essential skills of a project manager.
Organization structures for projects
The project team
Motivation
Scope statement
Work breakdown structure (WBS)
Project Manager’s Roles
Manager-as-facilitator versus
manager-as-supervisor
1.
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Project Manager’s Roles
Use of a systems approach as
opposed to an analytical approach
2.
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Project Manager’s Roles
Avoid micromanagement
3.
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Project Manager’s Roles
Communicate … ensure that project team
members have appropriate knowledge
and resources
4.
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PM as Communicator
Communication paths between a project’s
parties-at-interest (stakeholders)
Senior
Manageme
nt
Client
PM
Outside
Interested
Parties
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Project
Team
Virtual Project Manager
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Geographically dispersed projects
Communication via
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email
web
telephone
video conferencing
Project Manager’s Golden Rule
“Never
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let the boss be surprised.”
Project Manager’s Responsibilities to the Project
1.
Acquiring resources
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2.
Fighting fires and obstacles
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3.
4.
5.
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getting necessary quantity and quality can
be key challenges
Technical problems, supplier problems and
client problems
Negotiation, conflict resolution, and
persuasion
Making trade-offs between cost, schedule
and scope
Leadership
Leadership
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Leadership involves:
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establishing a clear vision,
sharing that vision with others so that they will
follow willingly,
providing the information, knowledge and
methods to realize that vision, and
coordinating and balancing the conflicting
interests of all members and stakeholders.
A leader steps up in times of crisis, and is able
to think and act creatively in difficult
situations.
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Essential Skills of Project Manager
Ability to:
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negotiate
resolve conflicts
persuade
avoid “irrational
optimism”
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Characteristics of a Successful Project Manager
 Credibility
– he/she is
believable
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technical credibility
administrative
credibility
 Sensitivity
- politically
astute and aware of
interpersonal conflict
 Leadership, Style,
Ethics – able to direct
the project in an ethical
manner.
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Organizing the human element
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Organizations are systems of human elements
interacting to achieve goals.
Organization structure is the form of
relationships that bond their elements.
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Organization Structure
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Defines how tasks are divided, resources
are deployed, and departments are
coordinated
The set of formal tasks assigned
Formal reporting relationships
The design of systems to ensure
effective coordination of employees
across departments
The Organization Chart
Visual representation
Set of formal tasks
“The Home Depot is the world's
largest home improvement retailer
currently operating 1,363 stores.
Framework for vertical control
Formal reporting relationships
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The components of organizing
Definition of work.
 Division of work.
 Division of labor and specialization.
 Unity of command and direction.
 Responsibility and authority.
 Chain of command and span of control.
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TYPES OF AUTHORITY
President
Line authority
Staff authority
Legal
Department
Vice-President,
Production
Vice-President,
Marketing
Department
A
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Vice President,
Accounting
Department
B
Department
C
©The McGraw-Hill Companies, Inc., 1998
Span of Management
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Number of employees who report to a supervisor
Traditional view, about seven subordinates per
manager
Many lean organizations today have 30, 40, or
even higher subordinates
When supervisors must be closely involved with
subordinates, the span should be small
Supervisors need little involvement with
subordinates, it can be large
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SPAN OF MANAGEMENT
Org.
Level
(highest) 1
1
2
3
4
5
6
7
MEMBERS AT
EACH LEVEL
1
4
8
16
64
64
512
256
4,096
1,024
4,096
Span of 8
Operatives : 4,096
Managers : 585
Span of 4
Operatives : 4,096
Managers : 1,396
©The McGraw-Hill Companies, Inc., 1998
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Organization structures for projects
1.
2.
3.
4.
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Pure project organization
Functional project organization
Matrix project organization
Mixed organizational systems
The Pure Project Organization
President
Program
Manager
Manager
Project A
Manager
Project B
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VP Marketing
VP
Manufacturing
Marketing
Manufacturing
R&D
Human Resources
Marketing
Manufacturing
R&D
Human
Resources
VP
R&D
The Pure Project Organization
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Advantages
effective and efficient for large projects
resources available as needed
broad range of specialists
short lines of communication
Drawbacks
expensive for small projects
specialists may have limited technological
depth
may require high levels of duplication for
certain specialties
Functional Project Organization
President
Manufactur
ing
Project
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Marketing
R&D
Human
Resources
Finance
The Functional Project Organization
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Advantages
technological depth
Drawbacks
lines of communication outside functional
department can be slow
technological breadth can be missing
project rarely given high priority
Matrix Project Organization
President
Program
Manager
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Manufacturi
ng
Marketing
Finance
Human
Resources
R&D
PM1
3
1½
½
4
½
PM2
1
4
¼
1½
¼
PM3
0
1/2
3
1/2
1
Matrix Project Organization
 Advantages
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flexibility in way it can interface with parent
organization
strong focus on the project itself
contact with functional groups minimizes “projectitis”
ability to manage fundamental trade-offs across
several projects
 Drawbacks
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violation of the unity of command principle
complexity of managing the organization’s full set of
projects
intrateam conflict
Mixed Project Organization
President
Project
M
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Finance
Engineering
Project
Z
Manufacturi
ng
Project Management Offices
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can be several different types of
PMOs in large firms … with different
and sometimes overlapping areas of
operations
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CPMO (corporate project management office)
EPMO (enterprise project management office)
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The project team
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They must be technically competent
Senior members of the project team must be
politically sensitive
Members of the project team need a strong
problem orientation
Team members need a strong goal orientation
Project workers need high self – esteem
Gathering such a team is a nontrivial job. If it is
done well, motivation of teammembers is rarely
a problem.
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Motivation in organizations
What is motivation?
Motivation is concerned with the desire to do
something or achieve a particular result.
Motivated employees result in:
 Greater productivity
 Better quality products or service
 Lower staff turnover
 Reduced absenteeism
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Motivational theorists
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Maslow’s hierarchy of needs
Taylor’s theory of scientific management
Mayo’s theory of human relations
Herzberg’s two-factor theory
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Maslow
Self
actualization
Self esteem
Social
Safety
Physiological
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Maslow’s Hierarchy of Needs
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The hierarchy starts with our
basic physiological needs for
survival.
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As each need is met, the next
need up the hierarchy
becomes the motivator.
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Workplaces can meet these
needs e.g. pay provides the
means to satisfy basic needs
whereas training can provide
for self-actualisation.
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One criticism of Maslow’s
hierarchy is that workers may
not seek to have all their
needs met in the workplace.
Mayo
Mayo’s Theory of Human Relations
 Mayo’s experiments showed that:
 Teamwork is an important motivator.
 Managers should take an interest in
their workers
 He suggested that physical conditions
and pay matter less than social
interaction when motivating employees
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Herzberg
‘Motivators’ can
motivate but a
lack of motivators
does not cause
dissatisfaction
‘Hygiene
factors’ can
cause
dissatisfaction
but cannot
motivate
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Herzberg’s Two-factor Theory
• Motivators are factors that can
motivate workers by providing
job satisfaction.
• Motivators are concerned with
the job itself and include
achievement, recognition and
the responsibility
• Hygiene factors are external to
the job itself and can only cause
dissatisfaction if not fulfilled.
• Hygiene factors include
company policy, supervision,
pay and working conditions.
Taylor
Taylor’s Theory of Scientific
Management
 Taylor suggested that workers are only
motivated by pay.
 Scientific management also states that
the most efficient way to carry out a task
should be identified and then carried out
– giving rise to production assembly
lines.
 Taylor supported close supervision and
pay schemes that reward those that
produce more.
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Monetary methods of motivation
Fringe
benefits
Examples include company cars and discount
vouchers. May not encourage greater productivity
but often build company loyalty.
Bonuses
A payment usually related to the achievement of a
target. Usually easier to apply to sales or production
than the provision of a service.
Profit
share
Employees are encouraged to work hard to ensure
that the business is profitable, however, it is usually
spread evenly between both hardworking and less
hardworking staff.
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Monetary methods of motivation
Commission
Payments are made in relation to the number or
value of sales made. Encourages increased sales
but may lead to heavy handed selling techniques.
Piece rate
Payments are made per item produced. Encourages
productivity but sometimes at the expense of
quality.
Overtime
Additional payment made for extra hours worked.
Can provide greater flexibility to the workforce but
may result in low productivity during normal working
hours so employees can access overtime payments.
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Non-monetary methods of motivation
Job rotation
Employees move between different jobs e.g. on a
production line. Results in flexible, multi-skilled
staff but ultimately workers may just be moving
from one boring job to another.
Job
enlargement
Workers are given a wider variety of different
tasks to carry out although there is no increase in
the level of responsibility. This is sometimes
called horizontal loading.
Job enrichment Giving employees the chance to fully utilise their
abilities through, for example, providing a range of
challenges, training workers and allowing them to
demonstrate their skills.
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Non-monetary methods of motivation
Empowerment
Allowing workers greater autonomy. They have
greater freedom and power to control their own
working lives.
Team-working
Involves organising workers into groups, setting
team goals and awarding team rewards for
achieving targets. Team-working fits with Mayo’s
findings.
Participation
Employees participate in organisational decision
making through such things as quality circles and
works councils.
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Scope and statement of work
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Project planning starts with determining the
objectives, deliverables, and major tasks of
the project.
In combination these define the overall size of
the project and the range or extent of work it
encompasses, a concept called project scope.
User needs and requirements are compared to
constraints of time, cost, resources, and
technology to determine what, exactly, the
project should and can encompass.
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Example of a project’s scope
University technology upgrade
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Imagine being confronted with the following
scope :
“University X wants to upgrade its facilities to
include WiFi technologies accessible anywhere
on campus. This project will offer students,
faculty, and staff the ability to be productive
from anywhere on campus. The project will take
place over a time period in which measurable
results will be achieved.”
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What’s wrong?
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The previous scope completely lacks any of
the SMART goal features. SMART stands for:
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Specific
Measurable
Agreed Upon
Realistic
Time Bound
Updated scope
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In order to change the above scope into a
SMART goal, the university would have to
restate their project, perhaps in the following
manner:
“University X will upgrade the library,
dormitories, offices, and then all campus
buildings to IEEE 802.11 technology, starting at
the north side of campus with the library. This
project will facilitate productivity via computer
of faculty, staff, and students. The project will
be complete by fall semester, 2023.”
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Scope definition
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Scope statements don't just define the scope.
They also list the team name, start and end
dates, objectives, deliverables, and
milestones.
Alternative approaches may be identified,
expert judgments, stakeholder analysis, and
product analysis should also be listed.
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Scope definition
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Scope definition is the process of specifying the breath
of the project and its full span of outputs, end-items, or
deliverables.
The result of scope definition is a scope statement,
which includes:
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Main deliverables of the project
Some background about the problem being addressed or the
opportunity being exploited
Project objectives
Functions to be fulfilled by the deliverables
User requirements or high-level specifications
Assumptions and constraints (to provide the rationale as to
why the project has these deliverables and not others),
High-level project tasks or major areas of work.
Time limits
A template for project scope statement
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A template for a complete scope statement is
available online at
www.ProjectManagementDocs.com
A copy of this template is available on
BlackBoard
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Work Breakdown Structure (WBS)
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Once project objectives and deliverables in
the scope statement have been set, the next
step is to translate them into specific, welldefined elements of work; these are the tasks,
jobs, and activities the project team must do.
To insure that none are missed and that every
activity is well understood and clearly defined,
a systematic procedure called the “ WBS ” is
used.
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Work Breakdown Structure (WBS)
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The first step in creating a WBS is to divide the
total project into major categories.
These major categories then are divided into
subcategories that, in turn, are subdivided, and so
on.
This level-by-level breakdown continues so that
the scope and complexity of work elements is
reduced with each level of breakdown.
The objective of the procedure is to reduce the
project into work elements that are so clearly
defined that they, individually, can be accurately
budgeted, scheduled, and controlled.
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Generic levels in typical WBS
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Elements of the WBS
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A brain-storming Approach for Creating the
WBS
 Gather
project team.
 Provide each member with a pad of
Sticky-Notes (Post-it notes).
 Team members write down all the tasks
they can think of.
 Sticky-Notes are then placed and
arranged on wall according to the general
structure presented in the previous
slides.
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Example
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An R&D Manager asked a design engineer to
take responsibility as a project manager to
redesign a specific product and its packaging
in order to meet specific customers’
dimensional requirements.
The maximum duration of the project is 6
months.
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Team formation
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The design engineer (PM) roughly estimates
the kind of expertise needed in the project
and he forms the team that will be working
with him from the R&D department.
In the launch meeting, the PM asked his team
members to build the WBS for the project.
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Defining the major activities
Study
technical
specifications
of current
product
design
Get detailed
specifications
for
customers’
dimensional
requirements
Redesign the
package
according to
the proposed
redesign
Get
customers’
feedback
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Manufacture
the prototype
Construct a
detailed
alternative
redesign that
meets
customers’
requirements
Test the
prototype
Prepare final
report
Building the WBS
Develop an
approved redesign
for the product
1. Study
technical
specifications
of current
product
design
1.1 Review
drawings
1.2 Review
current
calculations
and specs
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2. Get
detailed
specs for
customers’
dimensional
requirement
3. Construct
a detailed
alternative
redesign that
meets
customers’
requirement
2.1 Discuss
requirement
s with
customers
2.2 Generate
alternative
preliminary
redesigns
2.3 Get
customers’
agreement for
the selected
redesign
4. Redesign
the package
according to
the proposed
redesign
3.1 Conduct
necessary
calculations
5.
Manufacture
the prototype
4.1 Conduct
necessary
calculations
4.2 drawing
3.2 Detailed
parts’
drawings with
specs
3.3
Construction
drawing
6. Test the
prototype
5.1 Acquire
necessary
material
and parts
5.2
Manufacture
the required
parts
5.3 Assemble
the product
5.4
Manufacture
the package
5.5 Put the
assembled
product in the
package
7. Get
customers’
agreement
8. Prepare final
report
WBS example #1
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WBS Example #2
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WBS Example #3 – Implementation of ERP
system (software and hardware)
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