Project Management: A Managerial Approach

Chapter 1 – Projects in Contemporary Organizations

Overview

• Project Management Growth Factors• Project Aspects• Project Criteria• Project Life Cycle• Project Management Profession

Introduction• Much of project management developed by the

military– Navy’s Polaris program– NASA’s space program– Strategic defense initiative

• Project management has found wide acceptance in industry External vs internal to organisation

• It has many applications outside of construction– Managing legal cases– Managing new product releases

Forces Of Project Management• Forces driving Project Management:

1. exponential expansion of human knowledge → dev, prod & dist.

2. growing demand for a broad range of complex, sophisticated, customized goods and services → product design an integ. & inherent part of prod and dist

3. evolution of worldwide competitive markets for the production and consumption of goods and services → what, when and how to distribute output

4. Expansion of global markets

• Team-based problem solving v. individual • All of these contribute to the need for organizations to do

more and to do it faster• Project management is one way to do more faster

Projects Tend to be Large• Projects tend to be large

– The Channel Tunnel, or Chunnel– Denver International Airport– Panama Canal expansion project– Three Gorges Dam, China

• Projects are getting larger over time– Flying: balloons planes jets rockets reusable

rockets• The more we can do, the more we try to do

Project Management Also Getting Smaller

1. More people are seeing the advantages of project management techniques

2. The tools are become cheaper

3. The techniques are becoming more widely taught and written about

The Professionalism of Project Management

• Complexity of problems facing the project manager• Growth in number of project oriented organizations

– The Project Management Institute (PMI) was established in 1969

– By 1990 it had 7,500 members– 1995, over 17,000 members– 1998--exploded to over 44,000 members

• This exponential growth is indicative of the rapid growth in the use of projects

• Importance of PMI as a force in the development of project management as a profession

Project Manager• Project manager is the key individual on a project• Project manager is like a mini-CEO• While project manager always has responsibility, may

not have necessary authority

Trends in Project Management• Achieving strategic goals• Achieving routine goals• Improving project effectiveness• Virtual projects• Quasi-projects

Organizational Imperatives • Traditional hierarchical management declining• Consensual management increasing• Increasing reliance on systems engineering• Projects integral to organizational strategy

The Definition of a “Project”

• Must make a distinction between terms:– Program - an exceptionally large, long-range

objective that is broken down into a set of projects– Task - set of activities comprising a project– Work Packages - division of tasks– Work Units - division of work packages

• A specific, finite task to be accomplished

The Definition of a “Project”

• Definition used by PMI:

A temporary endeavor undertaken to create a unique product or service

Project Management A Working Definition

• Project:– A problem with a known solution scheduled for

completion—unique and non-routine activities• Project Management:

– The science and art of solving the problem within predetermined time and resource parameters

Characteristics of a Project• Temporary• Have a supported purpose/importance• Performance specifications (form, fit, function)• Have a life cycle with finite due date• Interdependencies• Uniqueness• Resource requirements and tradeoffs• Stakeholder Conflict

Quasi-Projects and Fuzzy Goals

• Tasks without Specific Targets– No Who, What, When, Where, How Much

• Implied Performance, Cost, Time Constraints• “Projects” to Determine Project Scope

• Warning: If these Become Projects, Expect Delays, Cost Overruns, Dissatisfied Customers

Objectives of a Project• Project Objectives:

– Performance– Time– Cost

• Expectations of clients inherent part of the project specifications

• There are ancillary (process) goals:– Improving the organisation’s project management

competency & methods– Individual managerial experience gained– The health of the project team and the organisation– Environment

Objectives of a Project• 3 Project Objectives:

Why Project Management?

• The main purpose for initiating a project is to accomplish some goal

• Project management increases the likelihood of accomplishing that goal

• Project management gives us someone (the project manager) to spearhead the project and to hold accountable for its completion

Why Project Management? • Companies have experienced:

– Better customer relations– Shorter overall delivery times– Lower costs and higher profit margins– Higher quality and reliability– Higher worker morale

Why (not) Project Management?• Companies have also experienced some negatives:

– Greater organizational complexity– Increased likelihood of organizational policy violations– Higher costs– More management difficulties– Low personnel utilization– Says managers cannot accomplish the desired outcome– Conflict

The Project Life Cycle

• Stages of a Conventional Project:– Slow beginning– Buildup of size– Peak– Begin a decline– Termination

The Project Life Cycle

The Project Life Cycle

• Time distribution of project effort is characterized by slow-rapid-slow

Project Management Life CycleDefinition Planning Implementation Delivery

Lev

el o

f ef

fort

1. Goals2. Specifications3. Scope4. Responsibilities5. Teams

1. WBS2. Budgets3. Resources4. Risks5. Schedule

1. Status reports2. Change Orders3. Quality Audits4. Contingencies

1. Train user2. Transfer documents3. Release resources4. Reassign staff5. Lessons learned

Proactive Project Life Cycle

Levelof ValueofEffort

Low

High

Define Plan Implement Delivery Scope WBS/OBS/Schedule Resource (Re)allocation “Learn Curve” Tradeoffs Detailed Budget Cost Containment Final Report

Project Evaluation (Audit) Process

Change Management System

Project Manager Roles and Responsibilities

Closed-Loop Planning-Monitor-Control System

The Project Life Cycle

• Projects also exist which do not follow the conventional project life cycle

• Comprised of subunits that have little use as a stand alone unit, yet become useful when put together

The Project Life Cycle• Unlike the more conventional life cycle, continued inputs of effort at the

end of the project produce significant gains in returns (eg. Baking a cake, software project, chemical reaction project, writing a book/thesis)

The Project Life Cycle

It is essential for the Project Manager to understand the characteristics of the life cycle curve for his project

The distinction between the two life cycles plays a critical role in the development of budgets and schedules for the project

The Project Life Cycle

• Risk during project life cycle– With most projects there is some uncertainty

about the ability to meet project goals– Uncertainty of outcome is greatest at the start

of a project– Uncertainty decreases as the project moves

toward completion

Project Life Cycle:Reduce Uncertainty of Cost Estimate

END