Project management

Project management

MBA IV Semester

Unit-I : Project management

• Meaning of project management,• Forms of project organization,• Human aspects of Project Management, • Project life cycle, • Project Planning, Project control, • Pre-requisites for successful project

implementation and its stages, • role and responsibilities of project

managers.

Meaning of Project Management

• Project management in the modern sense began in the early 1960s, although it has its roots much further back in the latter years of the 19th century.

• The need for project management was driven by businesses that realised the benefits of organising work around projects and the critical need to communicate and co-ordinate work across departments and professions.

Definition

• Project management institute, USA: A project according to the institute, is a one shot, time limited, goal directed, major undertaking, requiring the commitment of varied skills and resources.

• A combination of Human and non human resources pooled together in a temporary organization to achieve a specific purpose.

Why Project Management?

• Today’s complex environments require ongoing implementations

• Project management is a method and mindset…a disciplined approach to managing chaos

• Project management provides a framework for working amidst persistent change

Characteristics/Features

• 1.Objectives

• 2.Life Span

• 3.Single Entity

• 4.Team Work

• 5.Life Cycle

• Uniqueness

• Risk and Uncertainty

• Project management is often summarised in a triangle. The three most important factors are time, cost and scope, commonly called the triple constraint. These form the vertices with quality as a central theme.

• More recently, this has given way to a project management diamond, with time, cost, scope and quality the four vertices and customer expectations as a central theme. No two customers' expectations are the same so you must ask what their expectations are.

Human aspects of Project Management

• A satisfactory human relations system is essential for the successful execution of a project. Without such a system the other systems of project management, however sound, are not likely to work well.

• To achieve satisfactory human relations in the project setting, the project manager must successfully handle problems and challenges relating to:

• Authority

• Orientation

• Motivation

• Group functioning

Forms of project organization

• Line and staff organisation

• Divisional organisation

• Matrix organisation

Line and staff organisation

Line and staff organisation

• In this form of organisation, a person (Project coordinator) is appointed with the primary responsibility of coordinating the work of the people in the functional departments.

• Does not have direct authority and direct responsibility of the line management.

• Rendering advice, sharing information, and providing assistance

Limitations

• This is a weak form of organisation which may be employed mostly for small projects- it is certainly not suitable for large projects.

• (Project coordinator) deprived of formal organisational authority ,he may find it difficult to exert leadreship and feel unsure of his role.

Divisional organisation

Divisional organisation

• A separate division is set up to implement the project.

• Headed by the project manager this division has its complement of personnel over whom the project manager has full line authority.

• He has total formal control over the division he heads

• A very strong organisation, facilitates planning and control, better integration of efforts

• Improves the prospects of fulfilling the time and budget targets

Limitations

• Inefficient use of resources

• Unnecessary duplication of specialists

• Difficult to achieve a higher degree of specialization of expertise .

Matrix Organisation

Matrix Organisation

• Twin objectives: efficient use of resources and effective realisation of project objectives- at the cost of greater organisational complexity,

• In this the personnel working on the project have a responsibility to their functional superior as well to the project manager.

• His means authority is share between project manager and functional manager.

• Employees in a matrix organization report on day-to-day performance to the project or product manager whose authority flows sideways (horizontally) across departmental boundaries. They also continue to report on their overall performance to the head of their department whose authority flows downwards (vertically) within his or her department.

limitations• In matrix form of organisation , hierarchical

principle is ignored .

• Clearly shows that the matrix form of organisation involves greater organisational complexity and creates an inherently conflictful situation.

• Costs can be increased if more managers (i.e. project managers) are created through the use of project teams.

Project life cycle

(1) Initiation

• In this first stage, the scope of the project is defined along with the approach to be taken to deliver the desired outputs. The project manager is appointed and in turn, he selects the team members based on their skills and experience. The most common tools or methodologies used in the initiation stage are Business Plan, Project Framework (or Overview), Business Case Justification, and Milestones Reviews.

(2) Planning

• The second phase should include a detailed identification and assignment of each task until the end of the project. It should also include a risk analysis and a definition of a criteria for the successful completion of each deliverable. The governance process is defined, stake holders identified and reporting frequency and channels agreed. The most common tools or methodologies used in the planning stage are Business Plan and Milestones Reviews.

(3) Execution and controlling

• The most important issue in this phase is to ensure project activities are properly executed and controlled. During the execution phase, the planned solution is implemented to solve the problem specified in the project's requirements.

(4) Closure

• In this last stage, the project manager must ensure that the project is brought to its proper completion. The closure phase is characterized by a written formal project review report containing the following components: a formal acceptance of the final product by the client.

Pre-requisites for successful project implementation

• Time and cost over-runs of projects are very common in India, particularly in the public sector. Due to such time and cost over-runs, projects tend to become uneconomical, resources are not available to support other projects and economic development is adversely affected. What can be done to minimise time and cost over-runs and thereby improve the prospects of the successful completion of projects? While a lot of things can be done to achieve this goal, the more important ones appear to be as follows:

Adequate formulation

• Slip-shod methods used for estimating costs and benefits.

• Omission of project linkages.

• Flawed judgments because of lack of experience and expertise.

• Undue hurry to get started.

• Deliberate over-estimation of benefits and under-estimation of costs.

Sound Project Organization• It is led by a competent leader who is

accountable for the project performance.• The authority of the project leader and his team

is commensurate with their responsibilty.• Adequate attention is paid to the human side of

the project.• Systems and methods are clearly defined.

• Rewards and penalties to individuals are related to performance.

Proper Implementation Planning

• Once the investment decision is taken-

• Develop a comprehensive plan for various activities like land acquisition, requirement of personnel etc.

• Estimate meticulously the resource requirements

• Specify cost standards.

Advance action

• On following activities must be initiated :

• Acquisition of land, identifying technical collaborators/consultants, arranging for infrastructure facilities, preliminary design.

Timely availability of funds

• Once a project is approved, adequate funds must be made available to meet its requirements as per the plan of implementation- it would be highly desirable if funds are provided even before the final approval to initiate advance action.

Judicious Equipment tendering and procurement

• A judicious balance must be sought which moderates the outflow of foreign exchange and provides reasonable fillip to the development of indigenous technology.

• To ensure effective coordination.

Better contract management

• Competence and capability of all the contractors must be ensured- one weak link can destroy the timely performance of the contract.

• Penalties for bad performance and rewards for good performance.

• Help should be provided to contractors and suppliers when they have genuine problems.

Effective monitoring

• To keep a tab on the progress:• Anticipating deviations from the implementation

plan .• Analyzing emerging problems• Taking corrective action.