1 Introduction to Project Management
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Introduction toProject Management
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• Introduction• Project Management Context and Process• Integration Management• Scope Management• Time Management• Cost Management• Quality Management• Human Resource Management• Communications Management• Risk Management• Procurement Management
Topics
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• Most IT Projects fail• A 1995 Standish Group study found that only 16.2% of IT
projects were successful• Over 31% of IT projects were canceled before
completion, costing over $81 B in the U.S. alone
• A 1999 ComputerWorld article listed ProjectManager as the #1 position IT managers say theyneed most for contract help
• The need for IT projects keeps increasing
• Companies in general are emphasizing projects
The Need...
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What Is a Project?• A temporary endeavor undertaken to
accomplish a unique purpose
• Results on a product of some kind
• Require resources, often fromvarious areas
• Involves uncertainty
• Has a sponsor and customer(s)• Different from an ongoing program
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The Triple Constraint
• Every project is constrained in differentways by its:• Scope/quality goals• Time goals• Cost goals
• It is the project manager’s duty tobalance these three often competinggoals
Scope Time
Cost
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What is Project Management?
“The application of knowledge, skills, tools,and techniques to project activities in orderto meet or exceed stakeholder needs andexpectations from a project”
(PMI*, Project Management Body of Knowledge (PMBOK Guide), 1996, p. 6)
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Advantages of ProjectManagement
• Clear definition of scope
• Clear definitions of roles
• Early identification of performanceerrors
• Means of accountability
• Product integrity
• Team participation
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Project Stakeholders• Stakeholders are all of the people
involved, in or affected by, projectactivities
• Stakeholders include:• The project sponsor and project team• Support staff• Customers• Users• Suppliers• Business partners• Opponents to the project
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9 Project ManagementKnowledge Areas
• Knowledge areas describe the keycompetencies that project managers mustdevelop• 4 core areas lead to specific project objectives
(Scope, Time, Cost, and Quality)• 4 facilitating areas are the means through
which the project objectives are achieved(Human Resources, Communication, Risk, andProcurement Management)
• 1 area (Project Integration Management)affects and is affected by all of the other areas
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Project Management Framework
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Project Management Tools andTechniques
• Assist project managers and their teamsin various aspects of projectmanagement, such as:• Scope: Project Charter and WBS• Time: Gantt charts, PERT charts, critical path
analysis• Cost: Cost estimates and Earned Value
Analysis
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Sample WBS Chart
Intranet Project
Concept Web Site Design Web Site Development Rollout Support
Design User Interface
Design Server Setup
Design Server SupportInfrastructure
Develop Pages andLinks
Develop Functionality
Content Management/Integration
Testing
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Sample Gantt ChartWBS Gantt Chart
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Sample PERT Chart
B
2 2 d ay sM on 8 /3/98 T ue 8 /4/ 9 8
C
3 3 d ay sM on 8/ 3/9 8 W ed 8/5/9 8
D
4 4 d aysT ue 8/4/98 F ri 8/ 7 /98
E
5 5 d aysW ed 8/5/9 8Tue 8 / 11 /98
G
7 6 daysThu 8/6 /98Thu 8/13/ 98
H
8 6 daysWed 8/12/9 8Wed 8 /1 9 /98
I
9 2 daysFri 8/14/ 98Mon 8 /17/ 98
F
6 4 day sWed 8/5/9 8Mon 8 / 1 0/98
A
1 1 da yMo n 8/3/98Mo n 8/3/9 8
J
10 3 daysThu 8/20/98 Mon 8/24/9 8
Each box is a project task from the WBS. Arrows show dependenciesbetween tasks. The tasks in red are on the critical path. If any taskson the critical path take longer than planned, the whole project will slipunless something is done.
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Advantages of Project Management• Stakeholders do not like surprises
• Good project management (PM) reduces risk
• PM provides the tools and environment toplan, monitor, track, and manage schedules,resources, costs, and quality
• PM provides a metrics base for futureplanning, as well as good (lean)documentation
• Project members learn and grow by workingin a cross-functional team environment
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How Project Management (PM)Relates to Other Disciplines
• Much Project Management knowledge isunique
• However, project managers must alsohave knowledge and experience in• General management• The application area of the project• The technology of the project
• Project managers must focus on meetingspecific project objectives
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Project Management and OtherDisciplines
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The Project ManagementContext and Processes
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Projects Function Within aLarger Environment
• Projects operate in a broadorganizational environment
• Project managers need to take aholistic of a project, and understandhow it is situated within the largerorganization
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Project Phases and the ProjectLife Cycle
• A project life cycle is a collection ofproject phases
• Project phases vary by project orindustry
• General phases include:• Concept• Development• Implementation• Close-out
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Phases of the Project Life Cycle
Concept Development Implementation Closeout
ManagementPlan
PreliminaryCost Estimate
3 level WBS
Project Plan
Budgetary CostEstimate
6+ level WBS
Last WorkPackage
Definitive CostEstimate
Bulk of timespent here
Completed work
Lessons learned
Customeracceptance
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Product Life Cycles
• Products also have life cycles
• The Systems Development LifeCycle (SDLC) is a framework fordescribing the phases involved indeveloping and maintaininginformation systems
• Typical SDLC phases includeplanning, analysis, design,implementation, and support
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Sample SDLC Models
• Waterfall model: has well-defined, linear stagesof systems development and support
• Spiral model: software is developed using aniterative or spiral approach rather than a linearapproach
• Modified Waterfall model: iterative phases withina basic waterfall model
• Incremental release model: progressivedevelopment of operational software
• Prototyping model: used for developingprototypes to clarify user requirements
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Waterfall SDLC
Initiation
Analysis
Design
Implement
Administer
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Spiral Modelof Software Development
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Distinguishing Project Life Cyclesfrom Product Life Cycles
• The project life cycle applies to all projects,regardless of the products being produced
• Product life cycle models vary considerably,based on the nature of the product
• Most large IT projects are developed as aseries of products
• Project management is a cross life cycleactivity done in all of the product life cyclephases
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Why Have Project Phases andManagement Reviews?
• A project should successfully passthrough each of the project phases inorder to continue on to the next
• Management reviews (also called phasegates or kill points) should occur aftereach phase, to evaluate the project’sprogress, likely success, and continuedcompatibility with organizational goals
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Functional, Project, and MatrixOrganizational Structures
Functional
Project
Matrix
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Recognize the Importance ofProject Stakeholders
• Project stakeholders are the peopleinvolved in or affected by projectactivities
• Project managers must take time toidentify, understand, and managerelationships with all project stakeholders
• Stakeholders may be either internal orexternal
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• Define scope of project
• Identify stakeholders, decision-makers,and escalation procedures
• Develop detailed task list (workbreakdown structures)
• Estimate time requirements
• Develop initial project management flowchart
• Identify required resources and budget
Project Management Functions
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• Evaluate project requirements• Identify and evaluate risks• Prepare contingency plan• Identify interdependencies• Identify and track critical milestones• Participate in project phase review• Secure needed resources• Manage the change control process• Report project status - Communicate!
Project Management Functions
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Skills of a Project Manager• Communication skills: listening, persuading
• Organizational skills: planning, goal-setting, analyzing
• Team Building skills: motivation, esprit de corps,empathy
• Leadership skills: sets example, energetic, vision,delegates, positive
• Coping skills: flexibility, creativity, patience,persistence
• Technological skills: experience, project knowledge
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Characteristics of EffectiveProject Managers
• Leadership by example• Visionary• Technically competent• Decisive• Good communicator• Good motivator• Stands up to upper
management when necessary• Encourages new ideas• Supports team members
• Sets poor example• Functionary• Lacks technical expertise• Not self-assured• Poor communicator• Poor motivator• Defers to upper management
on all issues• Stifles creativity
• Concerned with self
Effective Project Manager Ineffective Project Manager
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Project ManagementProcess Groups
• Project management can be viewed as anumber of interlinked processes:• Initiating processes• Planning processes• Executing processes• Controlling processes• Closing processes
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Level of Process Group ActivityOver Time
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ProjectIntegration Management
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Project Management Framework
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The Key to Overall ProjectSuccess: Good Project
Integration Management
• Project managers must coordinate all ofthe other knowledge areas throughout aproject’s life cycle
• Many new project managers have troublelooking at the “big picture”, focusing ontoo many details
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Project Integration ManagementProcesses
• Project Plan Development: taking theresults of other planning processes andputting them into a consistent, coherentdocument, the Project Plan
• Project Plan Execution: carrying out theProject Plan
• Overall Change Control: coordinatingchanges across the entire project
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Interface Management
• Identifying and managing the points ofinteraction between various elements ofthe project
• Project managers must establish andmaintain good communication andrelationships across organizationalinterfaces
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Project Plan Development
• A Project Plan is a document used tocoordinate all project planning documents
• Its main purpose is to guide projectexecution
• Project plans assist the project managerin leading the project team and assessingproject status
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Attributes of Project Plans
• Just as projects are unique, so are projectplans
• Plans should first and foremost guideproject execution
• Plans should be:• Dynamic
• Flexible
• Updated as changes occur
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Common Elements of aProject Plan
• Overview of the project
• Description of the project organization
• Management and technical processesused on the project
• Scope
• Schedule
• Budget
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Stakeholder Analysis
• A stakeholder analysis documentsimportant (often sensitive) informationabout stakeholders such as:• Stakeholders’ names and organizations• Roles on the project• Unique facts about stakeholders• Level of influence and interest in the project• Suggestions for managing relationships
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Sample Stakeholder Analysis
Key StakeholersAhmed Susan Erik Mark David
Organizationinternal senior mgt. Project team Project team Hardware vendor
Project Manager for other internal project
Role on projectsponsor of project and one of company's founders
DNA sequencing expert Lead programmerSupplies some instrument hardware
Competing for company resources
Unique factsdemanding, likes details, business focus, Stanford MBA
very smart, Ph.D. in biology, easy to work with, has a toddler
best programmer I know, weird sense of humor
start-up company, he knows we can make him rich if this works
Nice guy, one of oldest people at company
Level of interest very high very high high very high low - medium
Level of influence very high - can call the shots
subject matter expert - critical to success
high - hard to replace
low - other vendors available
low - medium
Suggestions on managing relationship
keep informed, let him lead conversations, do as he says and quickly
make sure she reviews specs and leads testing, can do some work from home
keep him happy so he stays, emphasize stock options, likes Mexican food
just give him enough lead time to deliver hardware
he knows his project takes a back seat to this one, but I can learn from him
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Project Plan Execution
• Involves managing and performing thework described in the project plan
• The majority of time and money is usuallyspent on execution
• The application area or the productdirectly affects project execution becausethe products of the project are producedduring execution
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Important Skills forProject Execution
• General management skills:• Leadership
• Communication
• Political skills
• Product skills and knowledge
• Use of specialized tools and techniques
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Tools and Techniques for ProjectExecution
• Work Authorization System: provides amethod for ensuring that qualified peopledo work at the right time and in the propersequence
• Status Review Meetings: regularlyscheduled meetings used to exchangeproject information
• Project Management Software: specialsoftware to assist in managing projects
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Overall Change Control
• Involves identifying, evaluating, andmanaging changes throughout the projectlife cycle
• Three main objectives of change control:• Influence the factors that create changes to
ensure they are beneficial• Determine that a change has occurred• Manage actual changes when and as they
occur
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Change Control System
• A formal, documented process thatdescribes when and how official projectdocuments and work may be changed
• Describes who is authorized to makechanges and how to make them
• Includes a Change Control Board,configuration management, and a processfor communicating changes
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Change Control Board (CCB)
• A formal group of stakeholdersresponsible for approving or rejectingchanges on a project
• Provides guidelines for preparing changerequests, evaluates them, and managesthe implementation of approved changes
• Evaluates the impact of proposedchanges on quality, schedule, budget
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Configuration Management• Ensures that the products and their
descriptions are correct and complete• Concentrates on the management of
technology by identifying and controllingthe functional and physical designcharacteristics of products
• Configuration management specialistsidentify and document configurationrequirements, control changes, record andreport changes, and audit the products toverify conformance to requirements
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Suggestions for ManagingOverall Change Control
• Plan for change• Establish a formal change control system,
including a Change Control Board (CCB)• Use good configuration management• Define procedures for making quick decisions
on smaller changes• Use written and oral performance reports to help
identify and manage change• Use automated tools to help manage and
communicate changes
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Need for Top ManagementCommitment
• Several studies cite top managementcommitment as one of the key factorsassociated with project success
• Top management should:• Help project managers secure adequate
resources• Get approval for unique project needs in a
timely manner• Receive cooperation from people throughout
the organization
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What Helps Projects Succeed?1987 Pinto and Slevin
• Clear project mission• Top management
support• Good project
schedule/plan• Good client
consultation
1995 Standish Group
• User involvement• Executive management
support• Clear statement of
requirements• Proper planning
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Need for OrganizationalCommitment to Information
Technology (IT)• If the organization has a negative attitude
toward IT, it will be difficult for an IT project tosucceed
• Having a Chief Information Officer (CIO) at ahigh level in the organization helps IT projects
• Assigning business staff to IT projects alsoencourages more commitment
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Need for OrganizationalStandards
• Standards and guidelines help projectmanagers be more effective
• Senior management should encourage:• Use of standard forms and software for project
management• Development and use of guidelines for writing
project plans or providing status information• Creation of a project management office or
center of excellence
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Project Scope Management
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What is Project ScopeManagement?
• Scope refers to all the work involved in creatingthe products of the project and the processesused to create them
• Project scope management includes theprocesses involved in defining and controllingwhat is or is not included in the project
• The project team and stakeholders must have thesame understanding of what products will beproduces as a result of a project and whatprocesses will be used in producing them
• Projects with poor scope management often fail
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Project Scope ManagementProcesses
• Initiation: beginning a project, or continuing tothe next phase
• Scope planning: developing documents toprovide the basis for future project decisions
• Scope definition: subdividing the major projectdeliverables into smaller, more manageablecomponents
• Scope verification: formal acceptance of theproject scope
• Scope change control: controlling changes toproject scope
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Project Initiation: StrategicPlanning and Project Selection
• The first step in initiating projects is toevaluate the project in the context of theorganization’s strategic plan
• Strategic planning involves determininglong-term business objectives
• IT projects should support strategic andfinancial business objectives
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Identifying Potential Projects
• Many organizations follow a formalplanning process for selecting ITprojects:• Develop an IT strategic plan based on the
organization’s overall strategic plan
• Perform a business area analysis
• Define potential projects
• Select IT projects and assign resources
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Methods for Selecting Projects
• There are usually more projects thanavailable time and resources to implementthem
• It is important to follow a logical processfor selecting IT projects to work on, suchas:• Focusing on broad needs• Categorizing projects• Financial methods• Weighted scoring models
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Focusing on BroadOrganizational Needs
• It is often difficult to provide strongjustification for many IT projects, buteveryone agrees they have a high value
• Three important criteria for projects:• There is a need for the project• There are funds available• There’s a strong will to make the project
succeed
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Financial Analysis of Projects
• Financial considerations are often animportant consideration in selectingprojects
• Three primary methods for determiningthe projected financial value of projects:• Net present value (NPV) analysis• Return on investment (ROI)• Payback analysis
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Net Present Value Analysis
• Net present value (NPV) analysis is amethod of calculating the expected netmonetary gain or loss from a project bydiscounting all expected future cashinflows and outflows to the present pointin time
• Projects with a positive NPV should beconsidered, if financial value is a keycriterion
• The higher the NPV, the better
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Net Present Value Example
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Return on Investment
• Return on investment (ROI) is incomedivided by investment ROI = (total discounted benefits - total discounted
costs) / discounted costs
• The higher the ROI, the better• Many organizations have a required rate
of return, or minimum acceptable rate ofreturn, on investment for projects
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Payback Analysis
• Another important financial considerationis payback analysis
• The payback period is the amount of timeit will take to recoup, in the form of netcash inflows, the net dollars invested in aproject
• Payback occurs when the cumulativediscounted benefits and costs are greaterthan zero
• Many organizations want IT projects tohave a fairly short payback period
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Payback Analysis SampleOAO Project Payback
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Jan-02
Apr-02
Jul-0
2Oct-
02Ja
n-03
Apr-03
Jul-0
3Oct-
03Ja
n-04
Apr-04
Jul-0
4Oct-
04Ja
n-05
Apr-05
Jul-0
5
Month
Total ongoing incremental cost ofOAOAccumulated Savings
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Project Charter• After deciding what project to work on, it
is important to formalize projects
• A Project Charter is a document thatformally recognizes the existence of aproject and provides direction on theproject’s objectives and management
• The Project Sponsor should sign theProject Charter to acknowledgeagreement on the need and intent of theproject
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Scope Planning and theScope Statement
• A scope statement is used to develop andconfirm a common understanding of theproject scope.
• It should include:• A project justification• A brief description of the project’s products• A summary of all project deliverables• A statement of what determines project
success
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The Work Breakdown Structure
• After completing scope planning, the nextstep is to further define the work bybreaking it into manageable pieces
• Good scope definition:• Helps improve the accuracy of time, cost, and
resource estimates• Defines a baseline for performance
measurement and change control• Aids in communicating clear work
responsibilities
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The Work Breakdown Structure
• A work breakdown structure (WBS) is anoutcome-oriented analysis of the workinvolved in a project.
• It defines the total scope of the project• It is a foundation document in project
management because it provides thebasis for planning and managing projectschedules, costs, and changes
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Sample Intranet WBS Organizedby Product
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Sample Intranet WBS Organizedby Phase
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Intranet WBS in Tabular Form1.0 Concept
1.1 Evaluate current systems1.2 Define Requirements
1.2.1 Define user requirements1.2.2 Define content requirements1.2.3 Define system requirements1.2.4 Define server owner requirements
1.3 Define specific functionality1.4 Define risks and risk management
approach1.5 Develop project plan1.6 Brief web development team
2.0 Web Site Design3.0 Web Site Development4.0 Roll Out5.0 Support
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WBS and Gantt ChartWBS Gantt Chart
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Approaches to DevelopingWBSs
• Using guidelines: Some organizationsprovide guidelines for preparing WBSs
• The analogy approach: Reviewing WBSs ofsimilar projects
• The top-down approach: Start with thelargest items of the project, and keepbreaking them down
• The bottoms-up approach: Start with thedetailed tasks, and roll them up
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Basic Principles for Creating a WBS1. A unit of work should appear at only one place in the WBS2. The work content of a WBS item is the sum of the WBS items
below it3. A WBS item is the responsibility of only one individual, even
though many people may be working on it4. The WBS must be consistent with the way in which work is
actually going to be performed; it should serve the project teamfirst and other purposes only if practical
5. Project team members should be involved in developing the WBSto ensure consistency and buy-in
6. Each WBS item must be documented to ensure accurateunderstanding of the scope of work included and excluded
7. The WBS must be flexible, to accommodate inevitable changes,while properly maintaining control of the work content in theproject according to the scope statement
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Scope Verification and ScopeChange Control
• It is very difficult to create a good scopestatement and WBS for a project
• It is even more difficult to verify project scope andminimize scope changes
• Many IT projects suffer from scope creep andpoor scope verification• FoxMeyer Drug filed for bankruptcy after scope creep on
a robotic warehouse
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Factors CausingIT Project Problems
Factor RankLack of user input 1Incomplete requirements and specifications 2Changing requirements and specifications 3Lack of executive support 4Technology incompetence 5Lack of resources 6Unrealistic expectations 7Unclear objectives 8Unrealistic time frames 9New Technology 10
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Suggestions for ImprovingUser Input
• Insist that all projects have a Sponsor fromthe user organization
• Have users on the project team
• Have regular meetings and document them
• Deliver something to project users andsponsor on a regular basis
• Co-locate users with the developers
• Use JAD and JAD/Plan Sessions
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Suggestions for Reducing Incompleteand Changing Requirements
• Develop and follow a requirements managementprocess
• Employ techniques such as prototyping, usecase modeling, and Joint Application Design tothoroughly understand user requirements
• Put all requirements in writing• Use a process for reviewing requested changes• Track changes to requirements• Emphasize completion dates• Provide adequate testing
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Project Time Management
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Importance of Project Schedules• Managers often cite delivering projects
on time as one of their biggestchallenges
• Average time overrun from 1995 CHAOSreport was 222%
• Time has the least amount of flexibility;it passes no matter what
• Schedule issues are the main reason forconflicts on projects, especially duringthe second half of projects
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Project Time ManagementProcesses
• Project time management involves theprocesses required to ensure timelycompletion of a project, including:• Activity definition• Activity sequencing• Activity duration estimating• Schedule development• Schedule control
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Schedules Come FromDefining Activities
• Project schedules grow out of the basicdocument that initiates a project• Project Charter includes schedule and budget
information• Scope statement and WBS help define what
will be done
• Activity definition involves developing amore detailed WBS and supportingexplanations, to understand all the workto be done
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Activity Sequencing
• Involves reviewing activities anddetermining dependencies• Mandatory dependencies: inherent in the
nature of the work; hard logic• Discretionary dependencies: defined by the
project team; soft logic• External dependencies: involve relationships
between project and non-project activities
• You must determine dependencies inorder to use critical path analysis
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Project Network Diagrams
• The preferred technique for showingactivity sequencing
• A schematic display of the logicalrelationships among, or sequencing of,project activities
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Sample Activity-on-Arrow (AOA)Network Diagram for Project X
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Arrow Diagramming Method(ADM)
• Also called activity-on-arrow (AOA)project network diagrams
• Activities are represented by arrows
• Nodes or circles are the starting andending points of activities
• Can only show finish-to-startdependencies
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Precedence DiagrammingMethod (PDM)
• Activities are represented by boxes
• Arrows show relationships betweenactivities
• More popular than ADM method and usedby project management software
• Better at showing different types ofdependencies
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Task Dependency Types
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Sample Precedence DiagrammingMethod (PDM) Network Diagram
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Activity Duration Estimating
• After defining activities and determiningtheir sequence, the next step in timemanagement is duration estimating
• Duration includes the actual amount oftime worked on an activity plus elapsedtime
• People doing the work should help createestimates, and an expert should reviewthem
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Schedule Development
• Uses results of the other time managementprocesses to determine the start and enddate of project activities
• Ultimate goal is to create a realistic projectschedule that provides a basis formonitoring project progress
• Important tools and techniques includeGantt charts, PERT analysis, and criticalpath analysis
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Gantt Charts• Gantt charts provide a standard format
for displaying project scheduleinformation by listing project activitiesand their corresponding start and finishdates in a calendar format
• Symbols include:• A black diamond: milestones or significant
events on a project with zero duration• Thick black bars: summary tasks• Lighter horizontal bars: tasks• Arrows: dependencies between tasks
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Sample Gantt Chart
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Gantt Chart
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Sample Tracking Gantt Chart
white diamond: slipped milestonetwo bars: planned and actual times
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Critical Path Method (CPM)
• CPM is a project network analysistechnique used to predict total projectduration
• A critical path for a project is the series ofactivities that determines the earliest timeby which the project can be completed
• The critical path is the longest paththrough the network diagram and has theleast amount of slack or float
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Finding the Critical Path
• First develop an accurate projectnetwork diagram
• Add the durations for all activities oneach path through the project networkdiagram
• The longest path is the critical path
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Determining the Critical Path
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Techniques for Shortening aProject Schedule
• Crashing tasks by adding moreresources
• Fast tracking tasks by doing them inparallel or overlapping them
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Shortening Project Schedules
Overlappedtasks
Shortenedduration
Original schedule
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Many Horror Stories Related toProject Schedules
• The Mythical Man Month - addingresources to a late project often makes itlater
• Creating realistic schedules and stickingto them is a key challenge of projectmanagement
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Importance of Updating CriticalPath Data
• The critical path may change as you enteractual start and finish dates
• If you know the project completion datewill slip, negotiate with the projectsponsor
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Program Evaluation and ReviewTechnique (PERT)
• PERT is a network analysis techniqueused to estimate project duration whenthere is a high degree of uncertainty aboutthe individual activity duration estimates
• PERT uses probabilistic time estimatesbased on using optimistic, most likely,and pessimistic estimates of activitydurations
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PERT Formula and Example
• PERT weighted average formula:optimistic time + 4X most likely time + pessimistic time
6
• Example:PERT weighted average = 8 workdays + 4 X 10 workdays + 24 workdays = 12 days
6where 8 = optimistic time, 10 = most likely time, and 24 =
pessimistic time
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Controlling Changes to theProject Schedule
• Perform reality checks on schedules
• Allow for contingencies
• Don’t plan for everyone to work at 100%capacity all the time
• Hold progress meetings with stakeholdersand be clear and honest incommunicating schedule issues
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Working with People
• Strong leadership helps projects succeedmore than good PERT charts
• Project managers should use:• Empowerment• Incentives• Discipline• Negotiation
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Project 98 Features Related toProject Time Management
Reports Views and Table Views Filters• Overview reports: critical
tasks and milestones• Current activities reports:
unstarted tasks, tasks startingsoon, tasks in progress,completed tasks, should havestarted tasks, and slippingtasks
• Assignment reports: whodoes what when
• Gantt chart, PERTchart, Tracking Gantt,schedule, tracking,variance, constraintdates, and delay
• All tasks,completed tasks,critical tasks,incomplete tasks,and milestonetasks
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Words of Caution on UsingProject Management Software• Many people misuse project management
software because they don’t understandimportant concepts, and have not had goodtraining
• You must enter dependencies to havedates adjust automatically and todetermine the critical path
• You must enter actual scheduleinformation to compare planned vs actualprogress
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Project Cost Management
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The Importance of Project CostManagement
• IT projects have a poor track record formeeting cost goals
• Average cost overrun was 189% of theoriginal estimates
• In 1995, cancelled IT projects cost the U.S.over $81 billion
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What is Cost and Project CostManagement?
• Cost is a resource expended to achieve aspecific objective, or something given upin exchange
• Costs are usually measured in dollars
• Project cost management includes theprocesses required to ensure that theproject is completed within an approvedbudget
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ProjectCost Management Processes
• Resource planning: determining what resourcesand quantities of them should be used
• Cost estimating: developing an estimate of thecosts and resources needed to complete aproject
• Cost budgeting: allocating the overall costestimate to individual work items to establish abaseline for measuring performance
• Cost control: controlling changes to the projectbudget
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Basic Principles of CostManagement
• Most CEOs and boards know a lot moreabout finance than IT
• IT project managers must speak theirlanguage:• Profits are revenues minus expenses• Life cycle costing is estimating the cost of a project over
its entire life• Cash flow analysis is determining the estimated annual
costs and benefits for a project• Benefits and costs can be tangible or intangible, direct or
indirect• Sunk cost should not be a criteria in project selection
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Cost of Software Defects
10
Software DevelopmentLifecycle Phase
Requirements
Design
Coding
Unit Test
Acceptance test
Maintenance
1
5
10
20
50
200
Relative Cost to Repair
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Resource Planning• The nature of the project (and the
organization) will affect resource planning:
• How difficult will it be to do specific tasks on theproject?
• Is there anything unique in this project’s scopestatement that will affect resources?
• What is the organization’s history in doingsimilar tasks?
• Does the organization have or can they acquirethe people, equipment, and materials that arecapable and available for performing the work?
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Cost Estimating
• The key output of project costmanagement is a detailed cost estimate
• There are several types of cost estimatesand tools and techniques to help createthem
• Develop a cost management plan,describing how cost variances will bemanaged on the project
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Types of Cost Estimates
Type of Estimate When Done Why Done How Accurate
Rough Order ofMagnitude (ROM)
Very early in theproject life cycle,often 3–5 yearsbefore projectcompletion
Provides roughballpark of cost forselection decisions
–25%, +75%
Budgetary Early, 1–2 years out Puts dollars in thebudget plans
–10%, +25%
Definitive Later in the project, <1 year out
Provides details forpurchases, estimateactual costs
–5%, +10%
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Cost Estimation Tools andTechniques
• Analogous or top-down: use the actual costof a previous, similar project as the basis forthe new estimate
• Bottom-up: estimate individual work itemsand sum them to get a total estimate
• Parametric: use project characteristics in amathematical model to estimate costs
• Computerized tools: use spreadsheets,project management software, or othersoftware to help estimate costs
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Typical Problems with IT CostEstimates
• Developing an estimate for a large softwareproject is a complex task requiring asignificant amount of effort
• Remember that estimates are done at variousstages of the project
• Many people doing estimates have littleexperience doing them
• Provide training and mentoring
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Typical Problems with IT CostEstimates
• People almost always underestimate• Review estimates and ask questions to make
sure estimates are not biased• Management often wants a number for a bid,
not a real estimate• Project managers must negotiate with project
sponsors to create realistic cost estimates
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Cost Budgeting
• Allocating the project cost estimate toindividual work items
• Results in a cost baseline
• Difficult and time consuming task that manyPMs are unprepared for
• Critical on larger and more complex projects
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Cost Control
• Project cost control includes:• Monitoring cost performance• Ensuring that only appropriate project
changes are included in a revised costbaseline
• Informing project stakeholders of authorizedchanges to the project that will affect costs
• Earned Value Analysis is an importanttool for cost control
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Earned Value Analysis (EVA)
• EVA is a project performance measurementtechnique that integrates scope, time, andcost data
• Given a baseline (original plan plusapproved changes), you can determine howwell the project is meeting its goals
• You must periodically enter actualinformation to use EVA.
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Earned Value Analysis Terms
• Budgeted cost of work scheduled (BCWS), alsocalled the budget, is that portion of the approvedtotal cost estimate planned to be spent on anactivity during a given period
• Actual cost of work performed (ACWP), also calledactual cost, are the total direct and indirect costsincurred in accomplishing work on an activityduring a given period
• Budgeted cost of work performed (BCWP), alsocalled Earned Value, is the percentage of workactually completed multiplied by the planned cost(or BCWS)
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Earned Value Formulas
Term FormulaEarned Value Budgeted Cost of Work Performed (BCWP) =
budgeted cost to date X % completeCost Variance CV=BCWP-ACWP (actual cost of work performed)Schedule Variance SV=BCWP-BCWS (budgeted cost of work scheduled)Cost Performance Index CPI=BCWP/ACWPSchedule Performance Index SPI = BCWP/BCWS
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Rules of Thumb for EVANumbers
• Negative numbers for cost and schedulevariance indicate problems in those areas.The project is costing more than plannedor taking longer than planned
• CPI and SPI less than 100% indicateproblems
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Using Software to Assist in CostManagement
• Spreadsheets are a common tool forresource planning, cost estimating, costbudgeting, and cost control
• Many companies use more sophisticatedand centralized financial applicationssoftware for cost information
• Project management software has manycost-related features
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Project Quality Management
135
Quality of InformationTechnology Projects
• Many people joke about the poor quality ofIT products
• People seem to accept systems beingdown occasionally or needing to reboottheir PCs
• There are many examples in the newsabout quality problems related to IT
• Do we and should we accept lower qualityfor more innovation?
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What Is ProjectQuality Management?
• The International Organization forStandardization (ISO) defines quality asthe totality of characteristics of an entitythat bear on its ability to satisfy stated orimplied needs
• Other experts define quality based on:• Conformance to requirements: meeting written
specifications• Fitness for use: ensuring a product can be
used as it was intended
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Project Quality ManagementProcesses
• Quality planning: identifying which qualitystandards are relevant to the project andhow to satisfy them
• Quality assurance: evaluating overallproject performance to ensure the projectwill satisfy the relevant quality standards
• Quality control: monitoring specific projectresults to ensure that they comply with therelevant quality standards, while identifyingways to improve overall quality
138
Modern Quality Management
• Modern quality management• Requires customer satisfaction• Stresses prevention to inspection• Recognizes management responsibility for
quality
• Noteworthy quality experts includeDeming, Juran, Crosby, Ishikawa,Taguchi, and Feigenbaum
139
Quality Experts
• Deming was famous for his work in rebuilding Japanand his 14 points
• Juran wrote the Quality Control Handbook and 10steps to quality improvement
• Crosby wrote Quality is Free and suggested thatorganizations strive for zero defects
• Ishikawa developed the concept of quality circlesand using fishbone diagrams
• Taguchi developed methods for optimizing theprocess of engineering experimentation
• Feigenbaum developed the concept of total qualitycontrol
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Quality Planning• Quality must be designed in to the product
of the project in order to meet thecustomer’s requirements
• Design of experiments helps identify whichvariable have the most influence on theoverall outcome of a process
• Many scope aspects of IT projects affectquality: functionality, features, systemoutputs, performance, reliability, andmaintainability
141
Quality Assurance
• Quality assurance includes all the activitiesrelated to satisfying the relevant qualitystandards for a project
• Another goal of quality assurance iscontinuous quality improvement
• Benchmarking can be used to generate ideasfor quality improvements
• Quality audits help identify lessons learnedthat can improve performance on current orfuture projects
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Quality Control
• The main outputs of quality control are• Acceptance decisions• Rework• Process adjustments
• Some tools and techniques include• Pareto analysis• Statistical sampling• Quality control charts• Testing
143
Pareto Analysis
• Pareto analysis involves identifying thevital few contributors that account for themost quality problems in a system
• Also called the 80-20 rule, meaning that80% of problems are often due to 20% ofthe causes
• Pareto diagrams are histograms that helpidentify and prioritize problem areas
144
Sample Pareto Diagram
145
Statistical Sampling andStandard Deviation
• Statistical sampling involves choosing partof a population of interest for inspection
• The size of a sample depends on howrepresentative you want the sample to be
146
Standard Deviation
• Standard deviation measures how muchvariation exists in a distribution of data
• A small standard deviation means that datacluster closely around the middle of adistribution, and there is little variabilityamong the data
• A normal distribution is a bell-shaped curvethat is symmetrical about the mean oraverage value of a population
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Normal Distribution andStandard Deviation
148
Sigma and Defective Units
Specification Range
(in +/- Sigmas)
Percent ofPopulation
Within Range
Defective Units
Per Billion
1 68.27 317,300,000
2 95.45 45,400,000
3 99.73 2,700,000
4 99.9937 63,000
5 99.999943 57
6 99.9999998 2
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Quality Control Charts, SixSigma, and the Seven Run Rule
• A control chart is a graphic display of data thatillustrates the results of a process over time. Ithelps prevent defects, and allows you to determinewhether a process is in control or out of control
• Operating at a higher sigma value, like 6 sigma,means the product tolerance or control limits haveless variability
• The Rule of Seven states that if seven data points ina row are all below the mean, above,the mean, orincreasing or decreasing, then the process needs tobe examined for non-random problems
150
Sample Quality Control Chart
151
Testing
• Many IT professionals think of testing as astage that comes near the end of ITproduct development
• Testing should be done during almostevery phase of the IT productdevelopment life cycle
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Testing Tasks in the SoftwareDevelopment Life Cycle
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Types of Tests
• Unit testing is done by developers to test eachindividual component (often a program) to ensure itis as defect free as possible
• Integration testing occurs between unit and systemtesting to test functionally grouped components
• System testing tests the entire system as one entity
• User acceptance testing is an independent testperformed by the end user prior to accepting thedelivered system
• Parallel processing is often done in migrationprojects, comparing results of old and new systems
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Improving IT Project Quality
• Several suggestions for improving qualityfor IT projects include:• Leadership that promotes quality• Understanding the cost of quality• Focusing on organizational influences and
workplace factors that affect quality• Following maturity models to improve quality
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Leadership
• “It is most important that top managementbe quality-minded. In the absence ofsincere manifestation of interest at thetop, little will happen below.” (Juran, 1945)
• A large percentage of quality problemsare associated with management, nottechnical issues• Unrealistic schedule• Unrealistic budget• Limited resources
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The Cost of Conformance
• The cost of delivering products that meetrequirements and fitness for use• Prevention cost: the cost of planning and executing a
project so errors are within an acceptable range• Appraisal cost: the cost of evaluating processes and
their outputs to ensure quality• Measurement and test equipment costs: capital cost of
equipment used to perform prevention and appraisalactivities
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The Cost of Non-conformance
• The cost of taking responsibility forfailures or not meeting qualityexpectations• Internal failure cost: cost to correct an identified defect
before the customer gets the product• External failure cost: cost that relates to all errors not
detected and corrected before delivery to the customer
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Organization Influences,Workplace Factors, and Quality
• Study by DeMarco and Lister showed thatorganizational issues had a much greater influenceon programmer productivity than the technicalenvironment or programming languages
• Programmer productivity varied by a factor of 1:10across organizations, but only by 21% within thesame organization
• No correlation between productivity andprogramming language, years of experience, salary
• A dedicated workspace and a quiet work environmentare key factors in improving programmer productivity
159
Project HumanResource Management
160
What is ProjectHuman Resource Management?
• The processes required to make the mosteffective use of the people involved with aproject.
• Processes include:• Organizational planning• Staff acquisition• Team development
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Keys to Managing People
• Important areas related to projectmanagement include:• Motivation• Influence and power• Effectiveness
162
Motivation
• Abraham Maslow developed a hierarchyof needs to illustrate his theory thatpeople’s behaviors are guided by asequence of needs
• Maslow argued that humans possessunique qualities that enable them to makeindependent choices, thus giving themcontrol of their destiny
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Maslow’s Hierarchy of Needs
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Herzberg’s Motivational andHygiene Factors
• Frederick Herzberg wrote several famousbooks and articles about worker motivation.He distinguished between:• Motivational factors: achievement, recognition,
the work itself, responsibility, advancement, andgrowth, which produce job satisfaction
• Hygiene factors: cause dissatisfaction if notpresent, but do not motivate workers to domore, including larger salaries, moresupervision, and a more attractive workenvironment
165
Thamhain and Wilemon’s Ways toHave Influence on Projects
• Authority: the legitimate hierarchical right to issue orders• Assignment: the project manager's perceived ability to influence a
worker's later work assignments• Budget: the project manager's perceived ability to authorize others'
use of discretionary funds• Promotion: the ability to improve a worker's position• Money: the ability to increase a worker's pay and benefits• Penalty: the project manager's perceived ability to dispense or cause
punishment• Work challenge: the ability to assign work that capitalizes on a
worker's enjoyment of doing a particular task• Expertise: the project manager's perceived special knowledge that
others deem important• Friendship: the ability to establish friendly personal relationships
between the project manager and others
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Ways to Influence thatHelp and Hurt Projects
• Projects are more likely to succeed whenproject managers influence with:• Expertise• Work challenge
• Projects are more likely to fail when projectmanagers rely too heavily on:• Authority• Money• Penalty
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Power
• Power is the potential ability to influencebehavior to get people to do things theywould not otherwise do
• Types of power include:• Expert• Reward• Referent• Legitimate• Coercive
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Improving EffectivenessCovey’s 7 Habits
• Project managers can apply Covey’s 7habits to improve effectiveness on projects:• Be proactive• Begin with the end in mind• Put first things first• Think win/win• Seek first to understand, then to be understood• Synergize• Sharpen the saw
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Empathic Listening and Rapport
• Good project managers are empathiclisteners; they listen with the intent tounderstand
• Before you can communicate with others,you must have rapport
• IT professionals often need to developempathic listening and other people skills toimprove relationships with users and otherstakeholders
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Improving RelationshipsBetween Users and Developers• CIOs push their staff to recognize that the
needs of the business must drive alltechnology decisions
• Some organizations require businesspeople, not IT people, to take the lead indetermining and justifying investments innew computer systems
• Some companies reshape their IT units tolook and perform like consulting firms
171
Organizational Planning
• Organizational planning involves identifying,documenting, and assigning project roles,responsibilities, and reporting relationships
• Outputs and processes include:• Project organizational charts• Work definition and assignment process• Responsibility assignment matrixes• Resource histograms
172
Sample Organizational Chart for aLarge IT Project
173
Work Definition and AssignmentProcess
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Sample ResponsibilityAssignment Matrix (RAM)
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RAM Showing Stakeholder Roles
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Sample Resource Histogram for aLarge IT Project
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Resource Loading and Leveling
• Resource loading refers to the amount ofindividual resources an existing projectschedule requires during specific timeperiods
• Resource histograms show resourceloading
• Over-allocation means more resourcesthan are available are assigned to performwork at a given time
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Resource Leveling
• Resource leveling is a technique forresolving resource conflicts by delayingtasks
• The main purpose of resource leveling isto create a smoother distribution ofresource usage and reduce over-allocation
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Resource Leveling Example
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Team Development
• It takes teamwork to successfully complete anycomplex project
• Training can help people understand themselves,each other, and how to work better in teams
• Team based reward and recognition systems canpromote teamwork
• Focus on rewarding teams for achieving specificgoals
• Allow time for team members to mentor and helpeach other to meet project goals and develophuman resources
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General Advice on Teams
• Establish regular, effective meetings
• Fix the problem instead of blaming people
• Focus on meeting project objectives andproducing positive results
• Nurture team members, and encouragethem to help each other
• Acknowledge individual and groupaccomplishments
182
ProjectCommunications
Management
183
Importance of GoodCommunications
• The greatest threat to many projects is afailure to communicate
• IT professionals have a reputation for beingbad communicators
• Research shows that IT professionals mustbe able to communicate effectively tosucceed in their positions
• Strong communication skills are a key factorin career advancement for IT professionals
184
Project CommunicationsManagement Processes
• Communications planning: determiningthe information and communicationsneeds of the stakeholders
• Information distribution: communicatinginformation available in a timely manner
• Performance reporting: collecting anddisseminating performance information
• Administrative closure: generating,gathering, and disseminating informationto formalize phase or project completion
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Communications Planning
• Every project should include a documentthat guides project communications, aCommunications Management Plan
• Creating a stakeholder analysis forproject communications also aids incommunications planning
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Communications ManagementPlan Contents
• A method of gathering and storing communications
• A method of distributing key project information: towhom, when, and how
• A schedule for producing the information
• Access methods for obtaining the information
• A stakeholder communications analysis
• Includes both internal and external stakeholders
187
Sample Stakeholder Analysis forProject Communications
188
Information Distribution
• Getting the right information to the rightpeople at the right time and in a usefulformat is just as important as developing theinformation in the first place
• Important considerations include:• Using technology to enhance information
distribution• Formal and informal methods for distributing
information
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The Impact of the Number of People onCommunications Channels
2 people,1 line of communication
3 people,3 lines of communication
4 people,6 lines of communication
Lines of communication = n(n-1)/2
10 people = 10(10-1)/2 = 45 lines
190
Performance Reporting
• Performance reporting keeps stakeholdersinformed about how resources are beingused to achieve project objectives• Status reports describe where the project stands
at a specific point in time• Progress reports describe what the project team
has accomplished during a certain period of time• Project forecasting predicts future project status
and progress based on past trends• Status review meetings often include
performance reporting
191
Administrative Closure
• A project or phase of a project requiresclosure
• Closure of a phase allows the project tolearn from experience, and move to thenext phase
• Project closure produces:• Project archives• Formal acceptance• Lessons learned
192
Suggestions for ImprovingProject Communications
• Resolve conflicts quickly and effectively
• Run effective meetings
• Use templates for project deliverables
• Develop better communication skills
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Conflict Handling Modes, inPreference Order
• Problem-solving (confrontation) : directlyface a conflict
• Compromise: use a give-and-take approach• Smoothing: de-emphasize areas of
differences and emphasize areas ofagreement
• Forcing: the win-lose approach• Withdrawal: retreat or withdraw from an
actual or potential disagreement
194
Developing a CommunicationsInfrastructure
• A communications infrastructure is a set of tools,techniques, and principles that provide a foundationfor the effective transfer of information• Tools include e-mail, project management software,
groupware, fax machines, telephones, teleconferencingsystems, document management systems, and wordprocessors
• Techniques include reporting guidelines and templates,meeting ground rules and procedures, decision-makingprocesses, problem-solving approaches, and conflictresolution and negotiation techniques
• Principles include using open dialog and an agreed uponwork ethic
195
Using Software to Assist inProject Communications
• There are many software tools to aid inproject communications
• Microsoft Project 98 includes severalfeatures to enhance communications
• Open Issues database• E-mail is a powerful software tool
196
Project Risk Management
197
The Importance of Project RiskManagement
• Project risk management is the art andscience of identifying, assigning, andresponding to risk throughout the life of aproject and in the best interests ofmeeting project objectives
• Risk management is often overlooked onprojects, but it can help improve projectsuccess by helping select good projects,determining project scope, anddeveloping realistic estimates
198
Information Technology SuccessPotential Scoring Sheet
199
What is Risk?
• A dictionary definition of risk is “thepossibility of loss or injury”
• Project risk involves understandingpotential problems that might occur onthe project and how they might impedeproject success
• Risk management is like a form ofinsurance; it is an investment
• Risks are both threats and opportunities
200
Common Sources of Risk on ITProjects
• Scope creep• Inadequate executive sponsorship• Insufficient time committed by business
users• Loss of key team members• Vendor inability to perform• Decreasing hardware cost• New capabilities added to vendor product
201
What is Project Risk Management?
• The goal of project risk management is tominimize potential risks while maximizingpotential opportunities:• Risk identification: determining which risks are
likely to affect a project• Risk quantification: evaluating risks to assess the
range of possible project outcomes• Risk response development: taking steps to
enhance opportunities and developing responsesto threats
• Risk response control: responding to risks overthe course of the project
202
Risk Identification
• Risk identification is the process ofunderstanding what potentialunsatisfactory outcomes are associatedwith a particular project
• Risk identification tools:• Checklists• Lists of common risks• Flowcharts• Interviews
203
Potential Risk Conditions
204
Risk Quantification
• Risk quantification or risk analysis is the processof evaluating risks to asses the range of possibleproject outcomes
• Determine the risk’s probability of occurrence
• Determine the risk’s impact to the project if therisk does occur
• Risk quantification techniques include expectedmonetary value analysis, calculation of riskfactors, PERT estimations, simulations, and expertjudgment
205
Expected Monetary Value(EMV) Example
206
Risk Response Development
• Risk mitigation: reducing the impact of arisk event by reducing the probability ofits occurrence
• Risk avoidance: eliminating a specificthreat or risk, usually by eliminating itscause
• Risk acceptance: accepting theconsequences should a risk occur
207
General Risk MitigationStrategies for Technical, Cost,
and Schedule Risks
208
Risk Management Plans,Contingency Plans, andContingency Reserves
• A risk management plan documents theprocedures for managing risk throughoutthe project
• Contingency plans are predefined actionsthat the project team will take if anidentified risk event occurs
• Contingency reserves are provisions heldby the project sponsor for possiblechanges in project scope or quality
209
Risk Response Control
• Risk response control involves executing therisk management processes and the riskmanagement plan to respond to risk events
• Risks must be monitored throughout the lifeof the project
• Sometimes workarounds or unplannedresponses to risk events are needed whenthere are no contingency plans
210
Top 10 Risk Item Tracking
• Top 10 risk item tracking is a tool formaintaining an awareness of risk throughoutthe life of a project
• Establish a periodic review of the top 10project risk items
• List the current ranking, previous ranking,number of times the risk appears on the listover a period of time, and a summary ofprogress made in resolving the risk item
211
Example of Top 10 Risk ItemTracking
212
Using Software to Assist inProject Risk Management
• Databases can keep track of risks
• Spreadsheets can aid in tracking andquantifying risks
• More sophisticated risk managementsoftware helps develop models and usessimulation to analyze and respond tovarious project risks
213
Project ProcurementManagement
214
Importance of ProjectProcurement Management
• Procurement means acquiring goodsand/or services from an outside source
• Other terms include purchasing andoutsourcing
• The worldwide information technologyoutsourcing market is well over $100billion
215
Why Outsource?
• To reduce both fixed and recurrent costs
• To allow the client organization to focuson its core business
• To access skills and technologies
• To provide flexibility
• To increase accountability
216
Project ProcurementManagement Processes
• Procurement planning: determining what to procureand when
• Solicitation planning: documenting productrequirements and identifying potential sources
• Solicitation: obtaining quotations, bids, offers, orproposals as appropriate
• Source selection: choosing from among potentialvendors
• Contract administration: managing the relationshipwith the vendor
• Contract close-out: completion and settlement of thecontract
217
Project Procurement ProcessesKey Events
218
Procurement Planning
• Procurement planning involves identifyingwhich project needs can be best met byusing products or services outside theorganization. It includes deciding:• Whether to procure• What to procure• How much to procure• When to procure• How to procure
219
Procurement PlanningTools and Techniques
• Make-or-buy analysis: determiningwhether a particular product or serviceshould be made or performed inside theorganization, or purchased from someoneelse - often involves financial analysis
• Experts, both internal and external, canprovide valuable inputs in procurementdecisions
220
Types of Contracts
• Fixed price or lump sum: involve a fixedtotal price for a well-defined product orservice
• Cost reimbursable: involve payment to theseller for direct and indirect costs
• Unit price contracts: require the buyer topay the seller a predetermined amount perunit of service
221
Statement of Work (SOW)
• A statement of work is a description of thework required for the procurement
• Many contracts, mutually bindingagreements, include SOWs
• A good SOW gives bidders a betterunderstanding of the buyer’s expectations
222
Statement of Work (SOW)Template
223
Solicitation Planning
• Solicitation planning involves preparingdocuments soliciting information fromvendors or suppliers:• Request for Proposal: used to solicit proposals
from prospective sellers where there are severalways to meet the sellers’ needs
• Request for Quotes (Information): used to solicitquotes for well-defined procurements
• Invitations for bid or negotiation and initialcontractor responses are also part of solicitationplanning
224
Outline for a Request forProposal (RFP)
225
Solicitation
• Solicitation involves obtaining proposals orbids from prospective sellers
• Organizations can advertise to procuregoods and services in several ways:• Approaching the preferred vendor• Approaching several potential vendors• Advertising to anyone interested
• A bidders’ conference can help clarify thebuyer’s expectations
226
Source Selection
• Source selection involves:• Evaluating bidders’ proposals• Choosing the best one• Negotiating the contract• Awarding the contract
• It is helpful to prepare formal evaluationprocedures for selecting vendors
• Buyers often create a “short list”, andinvite finalist vendors to make apresentation
227
Sample Proposal EvaluationSheet
228
Contract Administration
• Contract administration ensures that theseller’s performance meets contractualrequirements
• Contracts are legal relationships, so it isimportant that legal and contractingprofessionals be involved in writing andadministering contracts
• Many project managers ignore contractualissues, which can result in serious problems
229
Suggestions on Change Controlfor Contracts
• Changes to any part of the project need to bereviewed, approved, and documented by the samepeople in the same way that the original part of theplan was approved
• Evaluation of any change should include an impactanalysis - how will the change affect the scope, time,cost, and quality of the goods or services beingprovided?
• Changes must be documented in writing
• Project team members should also document allimportant meetings and telephone phone calls
230
Contract Close-out
• Contract close-out includes:• Product verification to determine if all work
was completed correctly and satisfactorily• Formal acceptance• Administrative activities to update records to
reflect final results• Archiving information for future use
• Procurement audits identify lessonslearned in the procurement process
231
Project Success Factors• Dedicated Project Manager• The project team’s commitment to project• Accurate initial cost estimates• Project team's capabilities• Funding availability throughout project• Effective and flexible planning and control techniques• Absence of bureaucratic organization and controls• Minimal amount of start-up difficulties• Task (vs. social) orientation of project team• Clearly established criteria for project success• Constant monitoring of activity against plan• Effective change control
232
Conclusion• Clarity, openness, and communication are
key to project success
• Project Management is a team and not anindividual effort
• Effective Project Management guaranteesthat all team members are accountable toperform their agreed upon task
• Effective Project Management orchestratesall aspects of a project to implement theplan on time and on budget