Introduction to Project Management

Discussion Points
A Brief History of Project Management The Project Management Profession Emerging Business Trends Pro-active Management Style Advantages of Using Formal Project Management What is Functional Work? Portfolio, Programs? What is a Project? What is Project Management? PM Tools and Techniques An overview.

Relation Between PM and other Disciplines

History of Project Management

If PM is defined as a situation where resources have been assembled and organized to achieve one time specific objective, then PM has been practiced even centuries ago. Examples: The Great Pyramids of Giza (2550 BC), The Great Wall of China (221 BC 206 BC). These ancient wonders involved similar basic elements of PM: - Managing Resources (People, raw material) - Maintaining a Schedule, and - Co-ordinating different groups to synchronize various technical and functional aspects.
3

History of Project Management

Modern PM uses all the above 3 basic elements.

No evidence that the ancient wonders used optimal scheduling.

PM emerged as an important activity during late 19th Century when commerce grew and became complex. During Mid 19th century (US economic boom during American Industrial Revolution), business leaders faced the daunting task of managing large number of workers involved in manufacturing and assembling.
4

History of Project Management

Large scale government projects require large scale project management. Example: US Transcontinental Railroad project of 1862 one of the first organized Govt. project approved by President Lincoln that required large scale PM. In 1917 Henry Gantt developed the Gantt chart as a tool to keep track of project schedule. Early 1950s saw the beginning of modern project management.
5

History of Project Management

In 1958, the Navy developed PERT charts (by Booz Hamilton of Navy). This was followed by development of CPM by DuPont Corporation and Ramington Rand Corporation for managing plant maintenance projects. Professional societies like the Project Management Institute (PMI , formed in 1969) and International Project Management Association (IPMA) provide professional development programs.

History of Project Management

In the 1970s, the military began using project management software, as did the construction industry.

By the 1990s, virtually every industry was using some form of project management.

Project Management Knowledge Continues to Grow and Mature

The PMBOK Guide a comprehensive reference document on PM

Project Management Certification

PMI provides certification as a Project Management Professional (PMP) A PMP has documented sufficient project experience, agreed to follow a code of ethics, and passed the PMP exam One can go for such certification after having necessary education and experience. The number of people earning PMP certification is increasing quickly PMI and other organizations are offering new certification programs
9

You Can Apply Project Management to Many Areas

Project management applies to work as well as personal projects Project management applies to many different disciplines (IT, construction, finance, sports, event planning, etc.) Project management skills can help in everyday life

10

Project Stakeholders
Stakeholders are the people involved in or affected by project activities Stakeholders include the project sponsor and project team support staff customers users suppliers opponents to the project

11

Emerging Business Trends

Global marketplace and e-commerce are forcing organizations to change. There is a shift from mass production to customized production of goods and services. Focus is on quality, speed to market and customer satisfaction. Hierarchical management structures are making way for team centered structures which cut across functional units and operate in project mode. Routine operational tasks in offices and factories are getting automated. Data gathering and analysis is also getting automated. Middle management is, therefore, gradually disappearing. 12

Emerging Business Trends

The new focus is on project based team structures which are created for specific purpose e.g. to design a new product or to re-engineer a process, say an ordering process. Projects are conceived, staffed-up, completed and then shut down. Companies are focusing on core competencies as they outsource non-core activities. Companies are offering marketable skills but no job security. Salary packages are determined by the skill levels and marketability of a person rather than by managerial hierarchy. Success is determined by value of a project on which a person works.
13

Proactive Management Style

In the emerging trend, management is expecting more with lesser resources The solution lies in proactive management style rather than reactive management style. Systematic PM is a pro-active style. Winner companies have superior PM processes Functional departments are becoming inter-dependent. Project Teams are formed by drawing manpower resources from various functional departments to accomplish project work. After project completion, members are re-grouped into a new team to take on another project. PM is increasingly being recognized as an important aspect of responsive management.
14

(Likely) Advantages of Using Formal Project Management

Better control of financial, physical, and human resources Improved customer relations Shorter development times Lower costs Higher quality and increased reliability Higher profit margins Improved productivity Better internal coordination Higher worker morale

15

More Advantages of Project Management*

Bosses, customers, and other stakeholders do not like surprises Good project management (PM) provides assurance and reduces risk PM provides the tools and environment to plan, monitor, track, and manage schedules, resources, costs, and quality PM provides a history or metrics base for future planning as well as good documentation Project members learn and grow by working in a cross-functional team environment
*Knutson, Joan, PM Network, December 1997, p. 13
16

The 2001 Standish Group Report Showed Decided Improvement in IT Project Success Rates From the 1995 Study
Time overruns significantly decreased to 63% compared to 222% Cost overruns were down to 45% compared to 189% Required features and functions were up to 67% compared to 61% 78,000 U.S. projects were successful compared to 28,000 28% of IT projects succeeded compared to 16%
17

Huge Opportunity for Project Management in the context of IT

IT Projects have a terrible track record A 2009 Standish Group study (CHAOS) found that: 32% Successful (On Time, On Budget, Fully Functional) 44% Challenged (Late, Over Budget, and/or Less than Promised Functionality) 24% Failed (Canceled or never used) Annual cost of IT projects failure: 50 to 80 billion dollars (www.galorath .com)
18

Functional Work versus Project Work

19

What is Functional Work?

Characteristics (Attributes) of Functional Work Functional work is routine (repetitive), ongoing work, less risky. Primarily to sustain business. Functional departments ( hence functional managers) are responsible for specific functions e.g. maintaining quality Functional departments are typically structured as hierarchical with formal lines of authority.

20

Portfolios, Programs, Projects

Program: A group of related projects managed together to obtain benefits that could not have been realized if these projects are managed individually. - Programs last as long as organizations last even though specific projects within a program may be of limited duration. Portfolio: A collection of projects or programs grouped together for the purpose of their effective management to meet strategic business objectives. - The projects or programs of a portfolio may not be directly related. These are multiple initiatives identified by senior management for organizational growth. A PM must understand the implications of program and portfolio decisions on his/her project.

21

What Is a Project?
Characteristics (Attributes) of Project Work Project work is unique, temporary endeavor to serve a specific purpose (unique because the product or service they create is different from similar products and services; temporary because projects have a definite beginning and definite end) Project Managers manage specific projects Requires resources, often from different areas Manpower and other resources are not assigned to the project managers on ongoing basis, except for project management support
22

What Is a Project?
Characteristics (Attributes) of Project Work Project work is unique and thus involve uncertainty. The risk involved is, therefore, high Project work is generally not structured in an hierarchical manner (structure discussed later) Should have a primary sponsor and/or customer

23

The Triple Constraint

Every project is constrained in different ways by its
Scope goals: What is the project trying to accomplish? (Scope: sum of products, services and results to be provided by the project) Time goals: How long should it take to complete? Cost goals: What should it cost?

It is the project managers duty to balance these three often competing goals

24

Figure: The Triple Constraint of Project Management

25

What is Project Management?

Project management is the application of knowledge, skills, tools, and techniques to project activities in order to meet project requirements (PMI*, Project Management Body of Knowledge (PMBOK Guide), 2004, p. 8)

*The Project Management Institute (PMI) is an international professional society. Their web site is www.pmi.org.

26

Project Management Framework

27

9 Project Management Knowledge Areas

Knowledge areas describe the key competencies that project managers must develop
4 core knowledge areas lead to specific project objectives (scope, time, cost, and quality) 4 facilitating knowledge areas are the means through which the project objectives are achieved (human resources, communication, risk, and procurement management) 1 knowledge area (project integration management) affects and is affected by all of the other knowledge areas

28

Project Management Tools and Techniques

Project management tools and techniques assist project managers and their teams in various aspects of project management Some specific ones include
Project Charter and WBS (scope) Gantt charts, network diagrams, critical path analysis, critical chain scheduling (time) Cost estimates and earned value management (cost)

29

Sample WBS for Intranet Project in Chart Form

Intranet Project Concept Web Site Design Web Site Development Roll Out Support

Design User Interface

Develop Pages and Links

Develop Functionality Content Migration/Integration Testing

Design Server Setup

Develop Server Support Infrastructure

30

Figure 1-4. Sample Gantt Chart

The WBS is on the left, and each tasks start and finish date are shown on the right using a calendar timescale.
31

Figure 1-5. Sample Network Diagram

Each box is a project task from the WBS. Arrows show dependencies between tasks. The bolded tasks are on the critical path. If any tasks on the critical path take longer than planned, the whole project will slip unless something is done.

32

Sample Earned Value Chart

300

EAC
250

BAC

200

BCWS or Cumulative Plan 150 BCWS ACWP or Cumulative Actual BCWP or Cumulative EV

Cost Variance
100 ACWP BWCP

Schedule Variance

50

0 1 2 3 4 5 6 Month 7 8 9 10 11 12

33

How Project Management (PM) Relates to Other Disciplines

Much of the knowledge needed to manage projects is unique to PM However, project managers must also have knowledge and experience in
general management the application area of the project

Project managers must focus on meeting specific project objectives

34

Project Management and Other Disciplines

35