Chapter 1 1 2 1. 2. 3. 4. 5. Understand why project management is becoming such a powerful and popular practice in business. Recognize the basic properties of projects, including their definition. Understand why effective project management is such a challenge. Differentiate between project management practices and more traditional, processoriented business functions. Recognize the key motivators that are pushing companies to adopt project management practices. 3 6. 7. 8. 9. Understand and explain the project life cycle, its stages, and the activities that typically occur at each stage in the project. Understand the concept of project “success,” including various definitions of success, as well as the alternative models of success. Understand the purpose of project management maturity models and the process of benchmarking in organizations. Identify the relevant maturity stages that organizations go through to become proficient in their use of project management techniques. 4 Examples of projects ◦ ◦ ◦ ◦ Chunnel between England and France Introduce Windows 7 Passing a college course Olympics These are examples of project management used to; improve operations, respond rapidly to changes, achieve breakthroughs, streamline development, manage the rising challenges A critical component of successful organizations and employees today “Projects, rather than repetitive tasks, are now the basis for most value-added in business” -Tom Peters 5 Considered to be any series of activities and task that: ◦ ◦ ◦ ◦ ◦ Are complex, one-time processes Developed to resolve a clear goal or set of goals Consume resources; time, money, people, etc. Constrained by budget, schedule and resources Are customer focused A project is a temporary endeavor undertaken to create a unique product, service, or result. -PMBOK® Guide –Fourth Edition 6 A project can be considered any series of activities and tasks that have: Specific objectives to be completed within certain specifications, Defined start and end dates, Funding limits, Human and nonhuman resources, and Multifunctional focus. 7 1. ◦ ◦ 2. 3. 4. 5. ◦ ◦ Ad-hoc endeavors with a clear life cycle. Predetermined timeline Clear beginning and end Building blocks in the design and execution of organizational strategies. Responsible for the newest and most improved products, services, and organizational processes. Provide a philosophy and strategy for the management of change. Project management entails crossing functional and organizational boundaries. Interrelated Tasks Involve People 8 The traditional management functions of planning, organizing, motivation, directing, and control apply to project management. The principal outcomes of a project are the 6. 7. satisfaction of customer requirements within the constraints of technical, cost, and schedule objectives. Projects are terminated upon successful completion of performance objectives. 8. ◦ ◦ Fixed Budget Unique and Specific Deliverable (Product, Service, or Result) 9 • • • Process Ongoing, day-to-day activities to produce goods and services Use existing systems, properties, and capabilities Typically repetitive Project Takes place outside the normal, processoriented world Unique and separate from routine, processdriven work Continually evolving A project is a temporary endeavor undertaken to create a unique product, service, or result. -PMBOK® Guide 10 The purpose of operational tasks is to carry out dayto-day activities and sustain the business while the purpose of a project is to meet specific objectives. 11 Process (day-to-day activity) Project (unique activity) 1. Repeated process or product 1. New process or product 2. Several objectives 2. One objective 3. On-going 3. One shot – limited life 4. More homogeneous 4. More heterogeneous 5. Systems in place 5. Systems must be created 6. Performance, cost, & time known 6. Performance, cost & time less certain 7. Part of the line organization 7. Outside of line organization 8. Bastions of established practice 8. Violates established practice 9. Supports status quo 9. Upsets status quo 12 To help organizations achieve their strategic goals. Due to pressures organizations find themselves facing: ◦ ◦ ◦ ◦ ◦ Shortened product life cycles. Narrow product launch windows. Increasingly complex and technical products. Emergence of global markets. Economic period marked by low inflation. 13 The person responsible for meeting the project objectives. Skilled in areas of ◦ ◦ ◦ ◦ ◦ ◦ ◦ ◦ Leadership Planning Interpersonal skills Communication Conflict negotiation Presentation skills Risk taking Time management Role functions Provide leadership Provide motivation Facilitate the work Maintain focus Maintain commitment Influence the organization ◦ Use resources efficiently ◦ ◦ ◦ ◦ ◦ ◦ 14 Initiate the Project Develop Project Management Plan Direct and Manage Project Execution Monitor and Control Project Work Perform Integrated Change Control Close Project 15 Hard Skills Soft Skills Managing technical issues Planning Contracting Budgeting Measuring performance Monitoring project quality Analyzing risks Communicating Negotiating Leadership Problem solving Conflict resolution Team building Political and cultural awareness 16 What are your strengths and weaknesses? Are you a leader or a manager? Are you proactive or reactive? 17 “Project management is the process of the application of knowledge, skills, tools, and techniques to project activities to meet project requirements.” - PMBOK® Guide –Fourth Edition) It is accomplished through the application and integration of the project management process of ◦ ◦ ◦ ◦ ◦ Initiating Planning Executing Monitoring Controlling 18 Initiating Planning Controlling Executing Closing 19 Innovative, produces new ideas and new products Geared toward accomplishing a specific goal Provides known dedicated resources Aimed at customer satisfaction Side note: ◦ Can be used to find future company leaders: Will show a persons ability to manage both technical and human challenges 20 Won’t work on our projects Too time consuming Just busy work Too complicated Rigid/inflexible technique Cost too much Not necessary, we’re doing okay without it 21 Program is “a group of related projects managed in a coordinated way to obtain benefits and control not available from managing them individually.” -PMBOK® Guide –Fourth Edition Common Objective Program Project 1 Project 2 Project 3 22 Process Management Project Management Program Management Portfolio Management 23 Conceptualization - the development of the initial goal and technical specifications. Planning – all detailed specifications, schedules, schematics, and plans are developed. Execution – the actual “work” of the project is performed. Termination – project is transferred to the customer, resources reassigned, project is closed out. Collectively, these four phases make up the generic project life cycle. 24 Conceptualization Termination 25 Select Project Define Scope Develop Project Relationship Perform Needs Analysis Define Requirements Create Project Charter Analyze Benefit-to-Cost Ratio Determine Net Present Value and Internal Rate of Return Get Project Approval 26 Develop Specifications Design Reviews Write Standard of Work (SOW) Build a Schedule Develop Work Breakdown Structure (WBS) Allocate Resources Build the Team Configure the Budget Plan for Procurement Assess Change Control Process 27 Update Requirements Manage Change Control Delegate the Work Manage the Team Monitor the Project Complete Tasks Analyze Variances Report Status 28 Deliver Product Document Lessons Learned Make Payments Verify Customer Satisfaction Celebrate Recognize and Reward Team Members 29 A project life cycle is “a collection of generally sequential and sometimes overlapping project phases whose name and number are determined by the management and control needs of the organization.” -PMBOK® Guide –Fourth Edition 30 Man Hours Conceptualization Planning Execution Termination Fig 1.3 Project Life Cycle Stages 31 Client Interest Project Stake $ Resources Creativity Uncertainty Conceptualization Planning Execution Termination 32 ------------------ Quadruple Client Budget Acceptance Success Schedule Performance Managing project constraints involves a constantly changing balance. 33 Remember: 94.35% of all statistics are fabricated Software & hardware projects fail at a 65% rate Over half of all IT projects become runaways Up to 75% of all software projects are cancelled Only 2.5% of global businesses achieve 100% project success Average success of business-critical application development projects is 35% We should not overestimate the benefits to be gained from project management while underestimating the commitment required to make it work. 34 List four factors that contribute to the success or failure of a project. Succeed Fail 35 Sound project management processes Projects tied to the organization’s strategic and business goals Senior management commitment and support Detailed requirements Skilled and appropriately aligned team members Clearly defined roles and responsibilities Realistic schedule Succeed Lack of project requirements Lack of defined or clear and concise requirements Lack of senior management sponsorship and commitment Inadequate project planning Absences of user involvement through out the project Lack of business ownership Fail 36 Clear understanding of the goals and objectives Clear understanding of the customer requirements Involvement of clients and management Realistic estimates and schedules Day-to-day control of the project Effective communication 37 Importance Most 4 Preparing for The Future 1 Project Efficiency 2 Impact on Customer 3 Business Success Least Short term Long term Time Project Completion 38 Allows organizations to benchmark the best practices of successful project management firms Shows a relative assessment of an organizations project management development Project management maturity models (rubric style) see Table 1.3 page 21 ◦ ◦ ◦ ◦ Center for business practices Kerzner’s project management maturity model ESI International’s project framework SEI’s capability maturity model integration Rubric – categorizes the specific level of performance expected for several levels of quality. 39 40 Personnel Development for Projects Networking Between Projects Project Scheduling 3 2.5 2 1.5 1 0.5 0 Project Stakeholder Management Structural Support for Project Management Portfolio Management Coaching, Auditing and Evaluating Proejcts Control Practices a useful way to display multivariate observations the length of each ray is made proportional to the size of that variable a.k.a a Radar Chart can be easily created in MS Excel 41 FIGURE 1.11 Organization of Textbook 42 1. 2. 3. 4. 5. 6. What are some of the principle reasons why project management has become such a popular business tool in recent years? What do you see as being the primary challenges to introducing a project management philosophy to most organizations? That is, why is it difficult to shift to a project-based approach in many companies? What are the advantages and disadvantages to using project management? What are the key characteristics all projects possess? Describe the basic elements of the project life cycle. Why is an understanding of the life cycle relevant for our understanding of projects? Think of a successful project and an unsuccessful project with which you are familiar. What would you say distinguishes the two, both in terms of the process used to develop them and their outcomes? 43 7. 8. 9. 10. 11. Consider the Expedition Everest case: What are the elements in Disney’s approach to developing their theme rides that you find particularly impressive? How can a firm like Disney balance the need for efficiency and smooth development of projects with the desire to be innovative and creative? Based on this case, what principles appear to guide their development process? Consider the six criteria for successful IT projects. Why is IT project success often so difficult to assess? Make a case for some set of factors being more important than others. As organizations seek to become better at managing projects, they often engage in benchmarking with other companies in similar industries. Discuss the concept of benchmarking. What are its goals? How does benchmarking work? Explain the concept of a project management maturity model. What purpose does it serve? Compare and contrast the four project management maturity models shown in Table 1.3. 44