1 Project Management: A Managerial Approach Chapter 1 – Projects in Contemporary Organizations.

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Project Management: A Project Management: A Managerial ApproachManagerial Approach

Chapter 1 – Projects in Chapter 1 – Projects in Contemporary OrganizationsContemporary Organizations

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OverviewOverview

• Project Management Growth FactorsProject Management Growth Factors

• Project AspectsProject Aspects

• Project CriteriaProject Criteria

• Project Life CycleProject Life Cycle

• Project Management ProfessionProject Management Profession

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Project Management Project Management EmergenceEmergence

• Explosion in human knowledgeExplosion in human knowledge

• Mass customization of products and Mass customization of products and servicesservices

• Expansion of global marketsExpansion of global markets

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Forces Of Project Forces Of Project ManagementManagement

• Forces driving Project Management:Forces driving Project Management:– 1. exponential expansion of human knowledge1. exponential expansion of human knowledge– 2. growing demand for a broad range of complex, 2. growing demand for a broad range of complex,

sophisticated, customized goods and servicessophisticated, customized goods and services– 3. evolution of worldwide competitive markets for the 3. evolution of worldwide competitive markets for the

production and consumption of goods and servicesproduction and consumption of goods and services

• Team-based problem solving v. individualTeam-based problem solving v. individual

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The Professionalism of The Professionalism of Project ManagementProject Management• Complexity of problems facing the project managerComplexity of problems facing the project manager• Growth in number of project oriented organizationsGrowth in number of project oriented organizations

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

– By 1990 it had 7,500 membersBy 1990 it had 7,500 members– 1995, over 17,000 members1995, over 17,000 members– 1998--exploded to over 44,000 members1998--exploded to over 44,000 members

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

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

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Project Management Institute:Project Management Institute:Membership Growth CurveMembership Growth Curve

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Organizational ImperativesOrganizational Imperatives

• Traditional hierarchical management Traditional hierarchical management decliningdeclining

• Consensual management increasingConsensual management increasing

• Increasing reliance on systems Increasing reliance on systems engineeringengineering

• Projects integral to organizational Projects integral to organizational strategystrategy

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The Definition of a “Project”The Definition of a “Project”

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

range objective that is broken down into range objective that is broken down into a set of projectsa set of projects

– TaskTask - set of activities comprising a - set of activities comprising a projectproject

– Work PackagesWork Packages - division of tasks - division of tasks– Work UnitsWork Units - division of work packages - division of work packages

• A specific, finite task to be accomplishedA specific, finite task to be accomplished

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Project Management Project Management A Working DefinitionA Working Definition• Project:Project:

– A problem with a known solution A problem with a known solution scheduled for completion—unique and scheduled for completion—unique and non-routine activitiesnon-routine activities

• Project Management:Project Management:– The science and art of solving the The science and art of solving the

problem within predetermined time and problem within predetermined time and resource parametersresource parameters

– Shouldering just enough risk to escape Shouldering just enough risk to escape with your career intact!!!with your career intact!!!

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Characteristics of a ProjectCharacteristics of a Project• Have a supported purpose/importanceHave a supported purpose/importance

• Performance specifications (form, fit, Performance specifications (form, fit, function)function)

• Known (bounded) solutionKnown (bounded) solution

• Have a life cycle with finite due dateHave a life cycle with finite due date

• InterdependenciesInterdependencies

• UniquenessUniqueness

• Resource requirements and tradeoffsResource requirements and tradeoffs

• Stakeholder ConflictStakeholder Conflict

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Quasi-Projects and Fuzzy Quasi-Projects and Fuzzy GoalsGoals

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

• Implied Performance, Cost, Time Implied Performance, Cost, Time ConstraintsConstraints

• ““Projects” to Determine Project ScopeProjects” to Determine Project Scope

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

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Objectives of a ProjectObjectives of a Project

• Project Objectives:Project Objectives:– PerformancePerformance– TimeTime– CostCost

• Expectations of clients inherent part Expectations of clients inherent part of the project specificationsof the project specifications

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Objectives of a ProjectObjectives of a Project• 3 Project Objectives:3 Project Objectives:

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Why Project Management?Why Project Management?

• Companies have experienced:Companies have experienced:– Better customer relationsBetter customer relations– Shorter overall delivery timesShorter overall delivery times– Lower costs and higher profit marginsLower costs and higher profit margins– Higher quality and reliabilityHigher quality and reliability– Higher worker moraleHigher worker morale

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Why (not) Project Why (not) Project Management?Management?

• Companies have also experienced Companies have also experienced some negatives:some negatives:– Greater organizational complexityGreater organizational complexity– Increased likelihood of organizational Increased likelihood of organizational

policy violationspolicy violations– Higher costsHigher costs– More management difficultiesMore management difficulties– Low personnel utilizationLow personnel utilization

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The Project Life CycleThe Project Life Cycle

• Stages of a Conventional Project:Stages of a Conventional Project:– Slow beginningSlow beginning– Buildup of sizeBuildup of size– PeakPeak– Begin a declineBegin a decline– TerminationTermination

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The Project Life CycleThe Project Life Cycle

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The Project Life CycleThe Project Life Cycle

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

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

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The Project Life CycleThe Project Life Cycle

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

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Project Management Life Project Management Life CycleCycle

Definition 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

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Proactive Project Life CycleProactive 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

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The Project Life CycleThe Project Life Cycle

• Unlike the more conventional life cycle, continued inputs of Unlike the more conventional life cycle, continued inputs of effort at the end of the project produce significant gains in effort at the end of the project produce significant gains in returnreturn

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Projects in Contemporary Projects in Contemporary Organizations Organizations

Figure 1-3

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Projects in Contemporary Projects in Contemporary Organizations Organizations

Figure 1-4

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Projects in Contemporary Projects in Contemporary Organizations Organizations

Figure 1-5

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Projects in Contemporary Projects in Contemporary Organizations Organizations

Figure 1-6