Advanced Project Management Advanced Project Management Level 6
Advanced Project Management
Learning Outcomes
At the end of this session candidates will be able to:
Explore the various definitions and characteristics of a project
Analyse the difference between leadership and management relating to projects
Explore why organisations in different sectors need to engage in projects and consider different types of project
Evaluate the importance and relationship of project and people management in achieving project goals.
Demonstrate an understanding of external business environmental factors and how they may affect a project.
Critically evaluate the concept of power and influence. Identify the key stakeholders for a purchasing and
logistics project and how their power and influence change throughout the life of the project.
Advanced Project Management
Definitions of Project Management
‘… A set of activities with a defined start point and a defined end state, which pursues a defined goal and uses a defined set of resources.’ (Slack et al)
“... A temporary endeavour undertaken to create a unique product or service”. (US PMI)
“... The process by which projects are defined, monitored, controlled & delivered.....desired outcome......bring about change” (APM)
Advanced Project Management
Definitions Cips Study Guide “a group of activities that have to be
performed in a logical sequence to meet pre-set objectives outlined by client”
Meredith & Mantel “a specific, finite task to be
accomplished......project seen as a unit....characteristics..importance, performance, lifecycle, interdependencies, uniqueness, resources and conflict”
What are key features? Group exercise
Advanced Project Management
Distinctions between Leadership and Management“Leadership is the lifting of a person’s vision
to higher sights, the raising of performance to a higher standard, the building of personality beyond its normal limitations”.
“Nothing better prepares the ground for such leadership than a spirit of management that confirms in the day-to-day practices of the organisation strict principles of conduct and responsibility, high standards of performance and respect for the individual and his work.”
Drucker; The Practice of Management
Advanced Project Management
What do Managers Do?
Plan Organise Coordinate Control Lead
Fayol
Is this mainly a shorter term focus?
Establishing overall purpose or policy
Forecasting and planning
Organising and allocating work
Giving instructions Checking
performance Coordinating the
work of othersBuchanan
Advanced Project Management
What do Leaders Do?
Enable people and groups to achieve their objectives
Set and communicate objectives
Monitor performance and give feedback
Establish basic values
Clarify and solve problems for others
Organise resources
Longer term?
Administer rewards and punishments
Provide information, advice and expertise
Provide social and emotional support
Make decisions on behalf of others
Represent the group to others
Arbitrate in disputes Act as a father
figure Become a scapegoat
Advanced Project Management
Leader or Manager?
Group exercise What do you see as the key
differences between management & leadership?
Which skills are more important in project management?
Recap Kotter p 11 – effective v efficient?
Also Mintzberg p 12
1
Advanced Project Management
Reasons that Organisations Undertake Projects
Change in: The external environment Markets and customer needs Technology Products and services Processes
Globalisation Impatient customers Increasing demand for unique and customised
solutions Change within organisations initiated by
senior managers Paired ex – list examples for each point above
– own org. or alternative
Advanced Project Management
Hard or Soft Projects
Hard – normally refer to tangible, measurable activities and processes
Soft – human factors and processes – eg communication, behavioural change and acceptance
Can you easily distinguish simply between these two aspects of project work
Is Millau Bridge a hard project?
Advanced Project Management
‘Hard’ vs ‘Soft’ Projects
Product development – p8 Process development – eg
BPR Re-design/modification of
products and processes Technology development Installation of new IT
systems example p9 – London Ambulance Service
Site relocation/closure Culture change Introduction of a new
organisational structure A new appraisal scheme
How would you categorise each of these?
Lyson’s categorisation of projects:
Manufacturing projects Construction projects Management projects Research projects
Too simplistic?
Advanced Project Management
Constituents of the Project Context
PEST/SLEPT factors
Porters 5 Forces analysis
Stakeholders Resource
constraints Time constraints Overall strategy of
the organisationCIPS syllabus
Complexity Completeness Competitiveness Customer focus
Maylor
Advanced Project Management
Common Stakeholder Expectations
Fit for purpose Aesthetically pleasing Free from defects Delivered on time Value for money Reasonable running costs Satisfactory reliability/durability Supported by worthwhile guarantees Which stakeholders do each of
above relate to?
Advanced Project Management
Stakeholder Power/Interest Matrix
Keep satisfied Key players
Keep informedLow
Pow
er
Low HighLevel of interest
Minimal effort
Hig
h
Source: Mendelow, 1991
Stakeholders are likely to
move between segments
during the life of a project
Advanced Project Management
How do you keep stakeholders satisfied? Satisfaction = perception –
expectation Manage their expectations Re projects – may be necessary to
“sell” the final outcome Ensure know actual requirements –
don`t over-promise Keep advised of progress
Spec exam paper – Sportsco Q 1
Advanced Project Management
Learning Outcomes
At the end of this session candidates will be able to:
Evaluate and explain the idea of the project as a conversion or transformation process.
Explore the concept of variety and volume in defining the nature of an operation and evaluate its application to project management.
Describe the role of a project selection
Advanced Project Management
A Project is a Conversion Process
The project(transformation
process)
The project(transformation
process)
Inputresources
Inputresources
MaterialsInformationCustomers Output
(product/service)
Customers
Input trans-forming
resources
FacilitiesStaff
Advanced Project Management
Conversion Process
Inputs Transformed into Outputs
Same as a process?
What other input resources do you need?
See p 30
Advanced Project Management
Projects as a Technology
Volume
Vari
ety
HighLow
Low
Hig
h
Projects
Processplant
Smallbatch
Largebatch
Advanced Project Management
The Project Model
ProjectInput:Want/need
Output:satisfied need
Mechanisms:•people•knowledge & expertise•capital•tools & techniques•technology
Constraints:•Financial•Legal•Ethical•Environmental•Logic•Activation•Time •Quality•Indirect effects
Advanced Project Management
Project Constraints
Group exercise
Discuss examples and give reasons why Maylor lists these factors - in previous slide -as constraints in his ICOM model
Advanced Project Management
Project Portfolio Process How many projects can an
organisation handle?
Identify projects that satisfy strategic needs They support multiple goals – feasible? They drive organisational improvement –
why might these take priority? They enhance/enable ‘key areas’ – how
determine?
Advanced Project Management
Portfolio Process
Prioritise candidate projects Limit active projects to a manageable
level – do you always have necessary resources?
Identify risk-intensive efforts – why? Balance short-, medium- and long-term
returns – why is this important?
Prevent projects getting in the back door – how/why might this happen?
Meredith & Mantel, 2005
Advanced Project Management
Project Selection Factors - Issues to Consider
Operations Interruptions, learning, process
Marketing Customer management issues
Financial Return on investment – what is acceptable?
Personnel Skills and training, working conditions –
what impact on employee motivation? Administrative
Regulatory standards, ‘strategic fit’ – with what?
Meredith & Mantel, 2005
Advanced Project Management
Strategic Success Factors
Project mission – clearly defined and agreed objectives
Top management support – top managers must get behind the project and make clear to all personnel at the outset their support
Project action plan – showing details of the required steps and resource requirements in the implementation process
Group ex – how would getting each of these factors wrong cause problems for an organisation? Can you think of any project failures attributable to any of these factors?
Meredith & Mantel, 2005
Advanced Project Management
What Projects Have in Common
An objective or objectives, usually defined in terms of quality, time and cost – the “iron triangle”
Each is unique – a ‘one-off’ – always? Of a temporary nature – what is temporary? A degree of complexity, stemming from
multiple tasks and participants – often the key challenge
A degree of uncertainty, often technical
NB. A ‘programme’ implies greater longevity or continuity
Spec Exam paper Q 3
Advanced Project Management
Learning Outcomes
At the end of this session candidates will be able to:
Consider different approaches to the project life cycle
Identify the different stages of the project life cycle and the key characteristics, demands and problems most likely to be encountered at each stage
Evaluate the concept of the project life cycle as a management tool
Investigate a variety of problem-solving approaches and the extent to which they may be relevant during the project life cycle
Advanced Project Management
Comparison of Characteristics of Projects and ProblemsProjects A supported purpose/
importance Specifications of
performance (form, fit, function)
Known solution Stages with finite due
date Interdependencies Uniqueness Resource requirements
and tradeoffs Stakeholder conflict
Meredith & Mantel, 2005
Problems Intransparency – lack
of clarity of situation Polytely – multiple
goals Complexity – large
numbers of items, interrelations and decisions
Dynamism – time considerations
Advanced Project Management
Three Stage Life Cycle Why might work in project follow this
guideline? Any examples? – construction of new
housing estate Consider time/effort impact – fig 4.2 p 39 Alternative patterns? See p 40
Why is it important to know what is likely scale of progress? How identify in advance?
Group ex – look at p 42 – relative importance of project objectives – agree?
Advanced Project Management
Four-stage Project Life Cycle
Source: Maylor
D1: Define the project
D2: Design the project process
D3: Deliver the project
D4: Develop the process
The brief
The proposal/PID
The outcomes
Process & product
knowledge
Advanced Project Management
Maylor’s Four-phase ApproachPhase Key issues Key questions
Define the project
Organisational & project strategy; goal definition
What is to be done?Why is it to be done?
Design the project process
Modelling & planning; estimating; resource analysis; conflict resolution; business case
How will it be done?Who will be involved in each part?When can it start and finish?
Deliver the project
Organisation; control; leadership; decision-making; problem-solving
How should the project be managed?
Develop the process
Assessment of process & outcomes; evaluation; changes for the future
How can the process be continually improved?
Advanced Project Management
Developing a Project Strategy
Gettingstarted
AnalysisCommitmentConsultation
Movingforward
PreparationFeasibility
trials
Bringingit in
Doingthe work
Making thechange
Handingit on
HandoverSupportReview
Source: CIPS
Advanced Project Management
4 Stage Models
Group exercise Compare and contrast Maylors 4
stage model to Cips version on slide – also use Cips version p 45 – table 4.4
Are they effectively one and the same – or are there genuine differences?
Advanced Project Management
Five-stage Project Life Cycle
Weiss & WysockiDefine
Close Out
Plan
Organise
Control
Changes
Corrective action
Stage 1
Stage 2
Stage 3
Stage 4 Stage 5
Advanced Project Management
5 Stage Models
See also Frigenti and Comninos model – p 45/6
Tables 4.5 and 4.6 p 46 – individual homework exercise – critically evaluate these 2 models, recommending your preferred option for use in your organisation
Advanced Project Management
McKinsey’s 7S Framework
Strategy
Style/culture
Systems Structure
Staff
Skills
Source: McKinsey 7S framework
Sharedpurpose
Advanced Project Management
The 7S Project Approach
Element Description
Strategy High-level requirements of the project and means to achieve them
Structure Organisational arrangements that will be used to carry out project
Systems Methods for work to be designed, monitored and controlled
Staff Selection, recruitment, management and leadership of those working on project
Skills Managerial and technical tools available to project manager and staff
Style/culture Underlying way of working and inter-relating within the project/organisation
Stakeholders Individuals and groups who have an interest in project process or outcome
Source: 7S
framework adapted by
Maylor
Advanced Project Management
7 S Framework
This is a more strategic approach to Project management – focuses upon strategic alignment and “fit”
Considers organisations capabilities, capacity, priorities and strategic objectives.
Does project fit or match these areas? Consider impact of project on other
activities and areas of the organisation – resources, culture etc
Advanced Project Management
Problem Solving Techniques Maylor Thamhain & Wilemon Thomas-Killman Conflict Resolution Brainstorming Ishikawa Fishbone Analysis Cause – Effect – Cause Analysis Decision Trees Pareto Analysis 5 Whys Lewins Force Field Analysis
Advanced Project Management
Systematic Problem-solving Model
Problemidentification
Seekalternativedefinitions
Selectdefinition
Evaluatepossiblesolutions
Selectsolution
Implement
Check and amend
Source: Adapted from Maylor
Advanced Project Management
Thamhain & Wilemon
What are main causes of conflict in projects?
Group exercise – prioritise from following;-
Cost, Personalities, Priorities, Procedures, Schedules, Staffing, Technical Problems
At what stage will some be more significant than others – use 4 stage approach – formation, early implementation, main programme, closing.
Advanced Project Management
Thomas-Killman Model
5 Approaches to conflict resolution Avoiding – what? When use? Forcing – what? Accommodating – why? Compromising – isn`t this always
the best way? Collaborating – how does this work? Is it horses for course approach?
Advanced Project Management
Brainstorming Purpose
To generate a large number of ideas To stimulate creativity
Technique The ‘problem’ to be solved is described or
stated Everyone participates, either in turn or simply
by calling out in an orderly way A team member captures everything as said on
paper/board No judgement or criticism of others’
suggestions: the group accepts outrageous, unrelated ideas
Ideas are developed by building on others’ ideas When there are no more ideas, the exercise is
overWhat are difficulties of using this technique in work
environment?
Advanced Project Management
Ishikawa Fishbone Analysis Purpose
To visually represent in specific categories the probable causes of a problem
To help people visualise a problem and structure its analysis
Process Identify the ‘problem’ and place it in the
‘Effect’ box. Trace the process through all stages to identify
all possible contributory causes. Use the Brainstorming technique to consider all the possible causes that may result in the ‘Effect’.
Group possible causes under headings (for example, the 4Ms: Methods, Manpower, Materials, Machines; or steps in the process being analysed).
Advanced Project Management
Example of Fishbone Diagram
Error in item stock
control
EFFECT
MACHINERY
MANPOWER
METHODSMATERIALS
Insufficient spaceat locations
Incorrect tube
pattern Labelling onlowest rack
Incorrect quantityat location
Counting
Mixed or mis-
placed stock Poor quality
staff training
Poorprocedures
Returns
Excessivemovement
s
Consecutiverack
numbering
No stock
stickersLoose
components Uneven
tube lengths
Looseend
stops
Advanced Project Management
Cause-effect-cause Analysis Purpose
To overcome stagnation in solving problems that are complex and difficult to structure
To identify the root cause of a problem Technique
Best results emerge when a skilled facilitator is available
State the problem and identify the effects Explore how the effects relate to one
another Use ‘why’ and ‘how’ successively to
explore causes of the observed effects Form a cause-effect diagram on which
action can be taken – see p 59/60
Advanced Project Management
Decision Trees Purpose
To identify likely outcomes and probabilities in a problem
To calculate the expected value of possible outcomes
Technique Identify the scope of the decision to be
taken Identify sub-decision points Identify the outcomes and probabilities
possible from each decision point Calculate the expected values for
specific routes through the tree May 07 Exam paper Q 5
Advanced Project Management
Learning OutcomesAt the end of this session candidates will be
able to: Explain the 6Σ approach and what it seeks to
achieve Identify the eight key processes and
requirements of PRINCE2 and evaluate the effectiveness of this approach to project management
Analyse the key requirements of Critical Chain and explain how projects that use CCPM can achieve better results than other methods
Explain concept of theory of constraints
Advanced Project Management
Six Sigma
A continuous improvement method – Motorola, 1986
Since applied and popularised by others, for example, GE and Honeywell
Aim – To profitably improve the quality of
products and services to the customer
Statistically, a defect rate = 3.4 defects per million opportunities – 99.9997% perfect
Is this always appropriate?
Requires major investment in time and resources
Advanced Project Management
Six Sigma Key characteristics:
Focuses on the customer's critical-to-quality needs (CTQs) – V.O.C.- what are they? How establish?
Concentrates on measuring product quality and improving process engineering
Gives top-down, project-driven process improvement and cost savings
Is a business strategy execution system and so is truly cross-functional
Provides focused training with verifiable ROI
Is business results oriented Has 3 key component areas – Process
Improvement, Process Design (Redesign), Process Management
Advanced Project Management
Process Improvement - DMAIC
Define
Control
Measure
Analyse
Improve
… the project goals andcustomer deliverables
… future process performance so that improvements can be sustained
… the process by eliminatingdefects
… and determine the root causesof defects
… the process to determinecurrent performance
Advanced Project Management
Process Design (Redesign) - DMADV Define – Id and set goals Match/measure – benchmark
against customer needs/expectations
Analyse – performance measurements & outline enhanced processes to meet customer needs
Design/implement – new processes in detail
Verify – controls to ensure compliance
Advanced Project Management
Process Management
Changes how organisation is structured and managed
4 Steps are ;- 1) Understanding processes and
customer expectations 2) Continual measurement 3) Analysis of data 4) Responding to variances
Is 6 Sigma a project management tool?
Advanced Project Management
Benefits of Six Sigma
Direct benefits decrease in defects reduced cycle time lower costs to
provide goods and services.
data-based decisions
sustained gains and improvements
better safety performance
fewer customer complaints
Indirect benefits improved customer
relations and loyalty team-building effective supply
chain management increased margins greater market
share world-class standard development of staff
skills
Advanced Project Management
Prince 2
Originated by UK Gov in 1989 – Prince 2 - 1996
Designed for public sector I.T. Projects
Now generic approach for all types of project
8 stage model – see Fig 6.1 page 67 and note the 8 inter-reacting stages plus external stage of Corporate Management –goup ex – read and evaluate
Advanced Project Management
PRINCE2 (Projects In Controlled Environments)
Key processes Directing the project Planning a project Starting up a project Initiating a project Controlling a stage Managing product
delivery Managing the stage
boundaries Closing a project
Project management Project Board:
Project assurance Project support
Project manager Documentation:
Quality log Issues log Risk log
Bureaucratic controls
Emphasis on early conflict resolution
Advanced Project Management
Prince 2
Group exercise What are advantages and
criticisms re this approach? See p 69 – agree with OGC claims?
Advanced Project Management
Critical Chain Traditional project estimation techniques
ineffective: Time and resource constraints usually violated,
for example,• People have to multi-task – see p 71• General Uncertainties• Departments include safety margins• Parkinsons Law• Goldratt – pass on delays but not advances• ‘Student syndrome’ (last minute)
So, PMs rely on ‘padding’ of schedules and budgets to provide slack
Unknown nature of event interaction Maylor, 2003, Meredith & Mantel, 2005
Advanced Project Management
Theory of Constraints Approach Project cannot move faster than slowest
process – “convoy effect” or “weakest link” Approach is to manage bottlenecks
(constraints) Activities with several predecessors
and/or successors Add ‘time buffers’ at bottleneck events
• ‘Safety stock’ has equivalent in manufacturing
• ‘Just-in-case’ equivalent to JIT • Statistically-derived ‘path buffers’
Establish the critical chain for scarce resources
Prioritise resources in chain eventsMeredith & Mantel, 2005 and Goldratt’s ‘Theory of Constraints’
Advanced Project Management
Constraints 2 – see p 72/73
Main stages of the TOC approach: Identify the constraint (critical path/critical
resources)
Exploit the system constraint – ie work it to its maximum capacity
Subordinate everything to the constraints
Elevate the constraint – find additional resources for it
Go back and find new constraints May Exam Case Study Q 1
Advanced Project Management
Learning OutcomesAt the end of this session candidates will be able
to: Identify and explain key stages in a typical project. Explain the tasks during project initiation and
definition Explain what is involved in developing a project
plan and budget and in evaluating project risk Explain how a project might be structured and
resources recruited, organised and allocated Identify key methods of measuring and controlling
project performance and recommend an appropriate approach for a project
Explain what is involved in the closure of a project Explain what is involved in the review and
evaluation of a project and the learning stemming from it
Advanced Project Management
Stages of a Typical Project1. Initiation and definition2. Planning3. Organisation and implementation4. Measurement, monitoring, control
and improvement5. Closure6. Review, evaluation and learning Not directly comparable with earlier
examples of life cycle modelsLysons
Advanced Project Management
Stage 1 – Initiation and Definition
What’s involved
Identifying project goals Listing project objectives Determining preliminary resources Identifying assumptions and risks
Tools & techniques
Financial appraisal Project initiation document (PID) Quality Function Deployment Risk analysis & risk/impact matrix Suitability/feasibility/vulnerability Voice of the customer
Advanced Project Management
Stage 1 Needs to consider;- Project selection – “sacred cow”, operating
necessity, competitive necessity, product line extension, comparative benefit – what do these mean?
Numerical selection methods – unweighted factor (how many boxes does it tick), unweighted factor scoring ( what marks does it score in each box), weighted factor score (which boxes are more important)
See P79 - discuss
Advanced Project Management
Stage 1 - continued
Scope/outcomes – what is excluded?
Timing Resources – what types? What R.O.I? Resources. Cashflow Risk Impact – how?
Likelihood/impact V.O.C. – remember 6 sigma
Advanced Project Management
Stage 2 – Project PlanningWhat’s involved
Identifying activities Estimating time and cost Sequencing activities – why
important? Identifying critical activities Refining the plan Updating the initial risk analysis Writing the project proposal
Tools and techniques
Project initiation document (PID) Work breakdown structure –
what/who/where/when Network diagrams and CPA QFD Risk analysis & risk/impact matrix SIPOC – see session 7
Advanced Project Management
Stage 2
What will be involved? Range and scope Sequence – often critical – why? Why written plan? How used? Project
creep Timing & Costs – assess spending
against likely achievements not time spent on activity – why?
Budgets – top down/bottom up? Use of Critical path analysis –
significant aspect at this stage – why?
Advanced Project Management
Stage 3 – Organisation and Implementation
What’s involved
Determining personnel needs Recruiting the project manager Recruiting the project team Organising the team Assigning work packages
Tools and techniques
Network diagrams and CPA Seven tools of quality control Problem-solving tools Risk analysis & risk/impact
matrix Team roles (Belbin)
Advanced Project Management
Stage 3
How project team is set up! How does existing organisational structure impact upon this?
Group exercise - What attributes do we need on the team?
Where do Belbin, Tuckman, Maylor models fit in this aspect of project management?
Cross functional teamworking – issues, problems
Advanced Project Management
Stage 4 – Measurement, Monitoring and ImprovementWhat’s involved
Defining management style Establishing control tools Preparing status reports Reviewing the project schedule Issuing change orders
Tools & techniques
SIPOC Problem-solving tools Seven quality tools QFD
Advanced Project Management
Stage 4
Consider both Organisation & Project Team Structure
What is appropriate management style – vary depending on project type/nature?
How control project? – which methods? Reporting process – to whom? Deadlines – key stages How/when review/evaluate progress? How communicate change? Important at this stage to refer back to
original proposal – why?
Advanced Project Management
Stage 5 – Closure of the project
What’s involved
Obtaining client acceptance Installing deliverables Documenting the project Issuing the final report
Tools and techniques
SIPOC Seven quality tools
Advanced Project Management
Stage 5
Have we met project aim? V.O.C. Implement project – do it! Does it
work? Why record the process used? Learning is crucial – can be more
important than project itself? Why? Report – to who? Finality Team feedback Closure
Advanced Project Management
Stage 6 – Review, Evaluation and Learning
What’s involved
Conducting a project audit Learning lessons (from
successes and failures) Communicating the review,
evaluation and learning
Tools and techniques
SIPOC Seven quality tools (including
cost of quality) Project review
Advanced Project Management
Stage 6
Audit process – did we achieve success?
Who audits? Internal? External? Audit only at end of project? Is on-going audit preferable? Why? What are problems/drawbacks re
auditing? Learning – Kolbs learning cycle
Spec exam paper Q 4
Advanced Project Management
Session 6
Tools & Techniques for Data Collection,Analysis and Decision Making
Advanced Project Management
Learning Outcomes
At the end of this session candidates will be able to:
Utilise a range of tools and techniques to assist in data collection, analysis and decision-making:
Appraise appropriateness, selection and implementation of the tools and techniques available to the project team
Advanced Project Management
Project Management Tools Seven tools of quality control Financial appraisal Voice of the customer Quality function deployment Project initiation document (PID) ‘Moments of truth’ Risk analysis and assessment (risk
mitigation) Risk/Impact matrix Suitability/feasibility/vulnerability
Advanced Project Management
Evaluating PM Tools and Techniques
Appropriateness Show that you can pick the right tool
for the task
Selection Show that you are aware of the
limitations, as well as its capabilities
Implementation Show that you can use the tools
correctly
Advanced Project Management
Ishikawa 7 Tools of QC
Flowcharts – graphical depiction of process Check sheets – simple log of occurrences
of specific event/problem Pareto Fishbone diagram Histogram – bar chart – shows data in
grouped frequency distribution Scatter diagram – eg correlation between
advertising spend and sales Statistical Process Control charts – control
limits re acceptable performance/tolerances
Advanced Project Management
Risk Assessment
What is the situation to be assessed? What can go wrong? (What are the
hazards?) What is the probability that each hazard
will occur? What are the consequences if it does go
wrong? What is the uncertainty of our risk
assessment? Summary – probability, impact and
uncertainty Recommendations
Advanced Project Management
‘Risk’ vs ‘Uncertainty’
Risk – When the decision maker knows the probability of each and every state of nature and thus each and every outcome. An expected value of each alternative action can be determined
Uncertainty – When a decision maker has information that is not complete and therefore cannot determine the expected value of each alternative
Meredith & Mantel, 2005
Advanced Project Management
Financial Appraisal
Payback period – time to recover initial investment through estimated cash inflows from the project
Average rate of return (ARR) – average annual profit ÷ average investment
Discounted cash flow (DCF) – present value method
Internal rate of return (IRR) – rate of return that equates present value of cash inflows and outflows
Profitability index – NPV of all future expected cash flows ÷ initial cash investments
Advanced Project Management
Quality Function Deployment QFD = VOC Final design/outcome = customers
needs See p 109/110 for worked example
Advanced Project Management
Service Quality
Dimensions of service quality
Access Communication Competence Courtesy Credibility Reliability Responsiveness Security Understanding Tangibles
Parusuruman, Zeithaml & Berry
‘Moment(s) of truth’ An interaction with a
customer SAS in 1980s:
Average passenger was in contact with five SAS staff per trip
Five million passenger journeys a year
25m opportunities a year to satisfy or dissatisfy customers
Advanced Project Management
Risk/impact Matrix
ImpactLow High
Pro
bab
ility
Low
Hig
h
Tolerance threshold(depends on organisation)
Advanced Project Management
Learning Outcomes
At the end of this session candidates will be able to:
Demonstrate the approach of systems thinking and process focus using process mapping techniques and procedures
Explain end-to-end processes Construct a flow chart for a process Explain the interfaces and swim lanes Explain the workings of critical chains software
and its impact on projects Appraise appropriateness, selection and
implementation of the systems and process techniques available to the project team
Advanced Project Management
Flow-charting Processes Purpose
To describe the ‘flow’ of a process Process
Identify the process to be charted. It should have defined inputs and outputs and an ‘owner’.
Define the start and end of the process with a circle or oval.
Identify the major steps and represent each with a rectangle. Start the description of each step using a verb (doing word), for example, measure diameter, collect from stores.
Show decisions as a diamond with no more than two outcomes (for example, ‘yes’ and ‘no’)
Represent the flow through the process with lines, using arrows where necessary for clarification, for example, up-arrow where flow returns to a previous step.
Advanced Project Management
Work Breakdown Structure Lists tasks to be completed – assigns
responsibility for each task Can`t eat an elephant Supported by Linear responsibility
chart – who “owns” task and where co-operation between depts or individuals is required
Gantt Charts – measures actual and planned progress – quickly highlights overruns – resource planner – even out demand for resources
Advanced Project Management
Interfaces and Swim Lanes Activities organised into channels –
each one representing the responsibilities of individual, dept or organisation
Highlight processing gaps and inefficiencies
Focus attention on high-risk areas where work is transferred between groups – the interface
See p 135
Advanced Project Management
Critical Path Analysis
Use Profex p 114 – 118 Worked example Crashing the project
Pert – use of estimates of likely duration of activity, optimistic estimate and pessimistic estimate to calculate mean time and standard deviation re activity.
Then use of probability statistics to estimate likelihood of over-runs
Gert – uses concept that some activities may fail & need repeating – use of statistics to estimate likely occurrence and costs of such events
Advanced Project Management
Learning OutcomesAt the end of this session candidates will
be able to:
Identify a range of purchasing and logistics projects
Identify characteristics that differentiate these projects from projects in other functional areas
Apply and appraise the usefulness of standard project management tools and techniques for purchasing and logistics projects
Apply computerised project management systems for purchasing and logistics projects
Advanced Project Management
Examples of P and S Projects Group exercise – what projects are
currently running in your org purchasing function?
What is your involvement? What are key objectives? What are main difficulties and
constraints?
Advanced Project Management
Characteristics of P and S projects Specific Time Constrained Limited Resources Cost Reduction Product performance Overcoming reluctance to change by internal
stakeholders Including int. Stakeholders in project – getting
their commitment Accessing variety of data – internal & external Securing significant “added value” for org. Develop good external relationships with
suppliers
Advanced Project Management
Managing P and S Projects Group exercise Applying concepts and models –
which of those examined so far do you use in your organisation?
Applying tools and techniques – which work best in your org?
Applying software – which do you use? How effective is it? What are advantages? See next slide
Advanced Project Management
Software Systems
Provide support in: Tracking contracts Tracking
responsibilities Tracking activities Communicating Integrating E-tendering
Evaluation criteria The nature of the
products Ownership of the
code Stability of
requirements Software
maintenance and development
Advanced Project Management
Software Systems
Group exercise What are main benefits in using
software packages for running projects?
What are the disadvantages?
Advanced Project Management
Learning Outcomes
At the end of this session candidates will be able to:
Evaluate the elements of the ‘iron triangle’ and their interdependency
Contrast the ‘iron triangle’ approach with the contingency and critical chains (‘crashing’) approaches
Analyse and identify process-based factors in the success and failure of purchasing and logistics projects
Explain the requirements of effective project leadership Appraise the qualities and characteristics of a successful
project manager Analyse and explain the characteristics and importance
of teamwork in a project Analyse the extent to which people management and
leadership issues contribute to success and failure in projects
Advanced Project Management
The ‘Iron Triangle’
Quality
Cost Time
Constituents of objectives:•Purpose•End result•Success criteria
Advanced Project Management
Iron Triangle
Standard idea Simple concept Relatively simple factors to measure Relevant for all projects – at least in
part Need to clarify objectives of each
clearly at outset Fundamental to negotiations However – remember targets will
probably change during project lifetime
Advanced Project Management
Contingent Approaches - no one “best way” – “it depends”
Developed during the 1990s to overcome weaknesses in the previous ‘one best way’ approach
Loose framework of approaches – use most suitable for the circumstances
Emphasise and cater for: Strategic context of projects with
their wide range of stakeholders Developments in technology New management methods, for
example, virtual teams Development of more capable PM
software
Advanced Project Management
Contingency approach 2
Project managers integrate: Resources Knowledge Processes
Means using one approach (or more) appropriate to the circumstances (contingencies)
Advanced Project Management
‘Crashing’ Project Float
‘Crashing’ is the process of reducing time spans on critical path activities so that the project is completed in less time
Usually involves greater cost: Overtime working Allocating additional resources Subcontracting
Effect:
Time
Cost
Advanced Project Management
Responsibilities of a Project Manager
Responsibility to the parent organisation
Responsibility to the client
Responsibility to the team members
“Above all, the PM must never allow senior management to be surprised” – Being prepared to give ‘bad news’
Meredith & Mantel, 2005
Advanced Project Management
Key Activities of Project Managers
Shaping goals and objectives – project goal inevitably changes
Obtaining resources – easy? Building roles and structures for
their team – “followers make their leader”
Establishing good communications Seeing the whole picture –strategic
vision Moving things forwards (especially
in difficult circumstances) - driver
Advanced Project Management
Role and Skills of the Project Manager Background and experience relevant to
needs of project Leadership and strategic expertise for the
‘big picture’ Technical expertise for sound decisions –
always? Interpersonal competence and people
skills to champion, communicate, facilitate, motivate, and so on
Proven managerial ability for getting things done
Weiss & Wysocki
Advanced Project Management
Skills
“He who has not walked the road, does not know the potholes” – Confuscius
Group exercise Agree with Confuscius? What other skills does project
manager need?
Advanced Project Management
Factors Affecting the Project Manager’s Role and Style
Nature of the task Organisational structure Organisational culture Individual motivations of the team
members
Style: Cooperation ↔ Coercion
Maylor
Advanced Project Management
Four Roles for Project Managers
Leadership – the vision and style
Motivation – managing expectations and rewards
Team building – skills mix and cooperation between members
Communication – different aspects and different stakeholders
Advanced Project Management
Project Teams
Personality theories, for example, Belbin based on: Intelligence (high/low) Dominance (high/low) Extraversion/introversion Stability/anxiety
Team activities Content – what the team does Process – how the group works
• Task processes• Maintenance processes
Team dynamics Forming Storming Norming Performing Mourning
Advanced Project Management
Project Teams
Teams make projects succeed – agree?
Who is in team? Temporary? Cross functional Conditional Crisis? Virtual teams? – core – peripheral
team members
Advanced Project Management
Belbin’s Team RolesImplementor Organising;
practical Inflexible
Coordinator Welcoming; strong sense of objectives
Ordinary intellect or creativity
Shaper Drive Prone to impatience and provocation
Plant Genius Up in the clouds
Resource investigator
Knows ‘a man who can’
Soon loses interest
Monitor evaluator
Judgement; critical reasoning
Unimaginative; not inspirational
Teamworker Promotes team spirit
Indecisive
Completer/ Finisher
Perfectionist Tends to worry about nothing
Specialist Technically specialised
Uninterested outside own area
Advanced Project Management
Dimensions of Project Success Efficiency – meeting the budget and
schedule
Customer impact/satisfaction – complex to define and evaluate – what is their perception of success/failure? Does it match yours?
Business/direct success – delivering a result for the business
Future potential – again, somewhat difficult and nebulous to ascertain
Meredith & Mendel, 2005
See also work of Westerveld – Profex p180 para 1.10
Advanced Project Management
Critical Success Factors in Projects
Clearly defined goals
Competent project manager
Top management support
Competent project team members
Sufficient resources allocated
Adequate communications
Control mechanisms
Feedback capabilities
Responsiveness to clients
Troubleshooting mechanisms
Project staff continuity
See p 158 – slight variance
Pinto & Slevin (1987) inSlack, Chambers & Johnston
Advanced Project Management
Critical Success Factors
Westerveld Leadership & Team Policy & Strategy Stakeholder management Resources Contracting Project management itself –
scheduling, budgeting etc
P180 para 1.11
Advanced Project Management
Ten Ways Projects may Fail1. Failure to appreciate
the impact of a multi-project environment on single project success
2. Irrational promises made due to a failure to take into account the variable nature of task performance
3. Irrational promises made due to a failure to take into account the statistical nature of project networks
4. Insufficient identification of dependencies
5. Focus on, and active management of, only a portion of what should be the full project
6. Reliance on due-date and wasting of any safety included in the project
7. Wasting of resources through sub-optimal utilisation
8. Wasting of the ‘best’ resources through over-use, multi-tasking and burn-out
9. Delivering original scope when conditions/needs change OR accepting changes to scope without sufficient impact analysis
10.Multi-tasking
Group ex – what others can you add?
Advanced Project Management
Project Failure
Consider Greer – p 159 table 11.4 Do you agree with these? Are they more logical than those
selected on previous page?
Advanced Project Management
Learning OutcomesAt the end of this session candidates will be able to:
Critically evaluate the key characteristics of the various forms of organisation structure and culture and their consequences for project management
Explain the key factors for consideration in choosing the best organisational structure for a project
Critically evaluate the use and value to organisations of project management maturity models
Evaluate the relationship between the business excellence model and the project management excellence model
Understand and explain what is meant by knowledge management and organisational learning
Demonstrate the strategic benefits and advantages gained through knowledge management and organisational learning
Appraise the impact of a organisational learning on the management of projects in purchasing and logistics
Advanced Project Management
The Functional Structure
Advantages The owning
division should have the relevant expertise
Specialists can share their knowledge and overtime expertise accumulates
It provides a clear sense of ownership and ensures continuity
Disadvantages It may engender a
‘silo’ mentality. Other specialists may not be consulted
Routine work may take precedence over the project
Motivation may suffer if the project is perceived as a professional diversion
Theproject
Advanced Project Management
The Project StructureAdvantages Manager has full
authority over the project with senior management backing
Grouping necessary resources in the project ensures rapid decision making
Relevant expertise is drawn from other parts of the organisation
The project team has a strong sense of identity and common purpose
Disadvantages It is suitable only for
larger projects as it is expensive to resource
Isolationism can develop leading to an ‘us’ and ‘them’ culture
Team members may lack technical expertise or understanding of user needs
Project A
Project B
Project C
Advanced Project Management
The Matrix Structure
Advantages An individual project
manager takes responsibility, usually with strong senior management support
Relevant resources are allocated as required, giving flexibility as well as expertise
Disadvantages Decision-making
power may still reside outside the project team
Members are likely to be working only part-time on the project and have at least two managers, which may cause anxiety
There may be a high level of competition and in-fighting for resources
The project
Advanced Project Management
What is Organisational Culture?
‘The deeper level of basic assumptions and beliefs that are
shared by members of an organisation, that operate
unconsciously and define in a basic taken-for-granted fashion an
organisation’s view of itself and its environment’
E. Schein (quoted in Johnson & Scholes)
Advanced Project Management
A Typology of Culture
Type of culture Representation
Power A web – spider – power from the centre
Role A Greek temple – columns – highly defined structure – large, hierarchical orgs
Task A net or matrix – suit project/problem solving teams – power from knowledge
People A cluster – members superior to the org.
Source: Handy, Understanding Organisations
Advanced Project Management
Culture and Management ApproachesCharacteristic of culture
Impact on management style
Anglo-Saxon cultures Delegation a preferred managerial style
Highly centralised authority
It is PM’s responsibility to seek out information
International culture PM cannot count on being voluntarily informed of problems by subordinates
Highly structured social classes
Participative management is difficult to practise; there is an assumption that the more educated, higher-class manager’s authority will be denigrated by using a participative style
Highly structured social system
The less direct managerial communication tends to be
Adapted from
Meredith & Mantel, 2005
Advanced Project Management
Culture
Group exercise Why is it important for a project
manager to be aware of cultural issues within an organisation?
Advanced Project Management
Organisational Readiness
The organisation places a high value on serving customers
The commitment of senior managers is long-lasting Key staff departments are positive about the
prospect of change The organisation has the human resources needed The organisation had the financial resources
needed The organisation as a whole recognises the need
for fundamental change The organisation has none of the complacency and
arrogance that often follows a sustained period of success
The organisation is free of the scepticism, mistrust and ambivalence that often follows a period of change
The organisation’s experience with TQM has created an environment that is receptive to change
Hammer & Stanton
Advanced Project Management
Project Management Maturity Matrix
Flat-liners Little or no progress in project performanceMistakes repeated; performance stays flat
Improvers Some improvementPerformance improves slightly over time
Wannabes Follow every initiative going in order to catch the leaders
World-class performers
Set ever-increasing standards of performance
Flat-liners
Improvers
Wannabes
World-class
Advanced Project Management
Project Excellence
Project excellence comprises cross-functional processes, project decision making, and team organisation that enable firms to bring high-quality products to market rapidly. Project excellence builds on functional excellence (that is, when a function has the necessary resources, along with standards, procedures, and tools, to be effective and efficient). Four major elements are required to deliver projects effectively. These elements include the people and processes involved in development: project governance, a defined development process, project core teams, and the project decision process are the four elements.
Advanced Project Management
Project Excellence Model®
AppreciationUsers
AppreciationClient
AppreciationContractors
AppreciationInd. parties
AppreciationProject team
Projectresults
Results areas
Policy &strategy
Environment
Means
Contracting
Projectmanagement
Leadershipand teams
Organisational areas
Source:Westerveld
Feedback
Advanced Project Management
EFQM Business Excellence Model
BusinessResults(15%)
Policy &Strategy
( 8% )
CustomerSatisfaction
( 20% )
Resources( 9% )
PeopleManagement
( 9% )
PeopleSatisfaction
( 9% )
Impact onSociety( 6% )
Processes(14%)
Leadership(10%)
Enablers Results
Advanced Project Management
Knowledge Creation and Management
Internalisation
Learning by doing
CombinationBuilding a
‘knowledge system’
Externalisation
Articulating tacit knowledge explicitly
Exp
licit
kn
ow
led
ge
Tacit knowled
ge To
Socialisation Sharing
experiences
Tacit
kn
ow
led
ge
Explicit knowled
ge
Advanced Project Management
A Learning Organisation is …
“… Capable of benefiting from the variety of knowledge, experience and skills of individuals through a culture which encourages mutual questioning and challenge around
a shared purpose or vision.”Johnson & Scholes
Advanced Project Management
Characteristics of a Learning Organisation Existence of conflicting ideas and
views Tolerance of failure Acceptance of ambiguity and
uncertainty with their attendant risks
Surfacing of assumptions and explicit debate widely within the organisation
Tolerance of a diversity of views Tolerance of ‘organisational slack’
Advanced Project Management
Using Learning and Discovery Start with a ‘loose’ project
approach built on many assumptions which are known
Accept the risks associated with the uncertainties
Track and review assumptions on a regular basis
Modify the assumptions and activities in the light of experience
Gradually learn what works and what doesn’t