Project Management and

Organizations
The name of the game, the players, and
the rules

Goals
Understanding what is a project, what is the life cycle of a
project and how it differs from other types of works
Understanding the influences organizations exert on
project and project executions
Understanding the players and the relationships among
them
Detailing the process groups and the knowledge areas

Internet References
Books
http://www.esse3.unitn.it
http://www.pmi.org
http://www.sybex.com
Historical References: http://www.wikipedia.org;
look for:
http://en.wikipedia.org/wiki/Timeline_of_project_management
Frederick Winslow Taylor,
Henry Laurence Gantt

What is a project
A project is a temporary endeavor undertaken to
create a unique product, service, or result

What is a project
Temporary:
definitive begin and end (either because the goals are met or the
project is closed - goals cannot or will not be met)
projects results are not necessarily temporary (see project and
product lifecycle)
Unique products, service, or result:
A product which is quantifiable (e.g. a component, )
A capability to perform a service, such a business function
A result, such as knowledge (collected in documents,
presentation, )
Progressive elaboration
Development by steps and in increments (need for keeping
project scope)

Projects and Operational Work

Work can be categorized either as project or operational.
Common characteristics:
Performed by people
Limited resources
Planned, executed, and controlled

Differences:
Project: obtain goals and termimate
Operational Work: sustain the business

Examples
Cooking dinner
Preparing a dinner for friends
Mass producing a car
Designing a car
Publishing papers
Developing a software system

Projects vs. Strategic Planning

Projects are a means of organizing activities that cannot be
achieved using organizations normal operation limits and
are often used to achieve an organizations strategic plan
Typically authorized by:
A market demand
An organizational need
A customer request
A technological advance
A legal requirement

Project Management Context

Project and Program Management
set of projects managed in a coordinated way in order to achieve
some sort of benefit
Programs may be cyclical (fundraising, publishing a newspaper,
)

Portfolios and Portfolio Management

A collection of projects or programs and other work grouped
together to facilitate management and meet strategic objectives

Project Management Context

Subprojects
Projects may be divided in subprojects (altough the sub-projects
may be referred to as projects and managed as such).
Examples: (based on the process) a phase of a project, (based
on skills) plumbing or wiring in building a house, (based on
technologies) automated testing of a software product.

Characteristics of a Project (Part

II)
(some of) The rules
(and the board game)

Project Life Cycle

Projects are usually organized in phases
Typically (but not necessarily) organizations define (or
adopt) their own life cycles, namely
The technical work to be done in each phase
The deliverables to be produced by each phase (a deliverable
is a measurable and verifiable work products)
Who is involved
The rules of transition from one phase to the next

Project Life Cycle

Inputs
Phases

Idea
PM Team

Initial
Charter

Outputs

Intermediate
Plan

Scope
Statement

Final

Progress
Baseline

Acceptance

Approval

Handover

Product

Project Life Cycle

Initial Phase

Initial Phase

Closing Phase

Cost and Staff

Influence of stakeholder

Cost of change

Project Life Cycle and Product

Life Cycle
Upgrade

Business Plan

Operations

Idea
Product

Phases Initial

Intermedi
ate

Final

Divestment

What is a project (part 2)

Projects can be seen from (at least) two points of view:
As a sequence of phases
As a variation of the plan-do-act-check loop

Some common characteristics and relationships:

Hierarchical (each major process is decomposed in smaller processes)
Iterative (it may repeat over time)
(sort of) mutually recursive (think, e.g., of subprojects)

Process Groups
If we take a slightly different point of view, we can
start organizing the activities necessary to carry
out a project in process groups
The organization is a variation of the plan-do-act
cycle

Process Groups
Monitoring &
Controlling

Planning

Closing

Initiating

Executing

Process Groups
Initiating: defines and authorizes the project
Planning: defines and refines the project objectives and plans the
course of actions
Executing: integrates people and resources to carry out the project
management plan
Monitoring and controlling: measures and monitors progress to
identify variances
Closing: formalizes acceptance of the product, service, or results
and brings the project to an orderly end.

Levels of Activity
Execute

Plan

Closing
Initiate

Process Groups and Project

Boundaries
Monitoring &
Controlling

Deliverables

End User

Planning

Project
Project
Initiator/Sponsor Inputs

Closing

Initiating

Executing

Project
Records

Process
Assets

Project and Organizations

(Some of) the players and (some of) the
rules

Functional/Hierarchical

Remarks
Operational decisions originate at the top of the hierarchy
and propagate
Sharp distinction of functions and rigid structure
Good for small firms, geographically concentrated, with a
small set of standard products, mainly focused in
operational work
Organization of work in projects is clumsy (unless project
managers are in the Direction)

Divisional

Remarks
First example: Du Pont (1921)
Strategy located in the Direction
Responsibility and operational decisions are taken
by the Division
Allows for specialization to specific
markets/sectors (e.g. expert in the A.I.)
Profits and losses are shared

Remark
(Fierce) competition among divisions
Divisions tend to operate on smaller term goals
Duplication of functions may increase costs
Projects within Division are relatively simple. Interdivisional
projects more complex.

Projectized
Project is central
Disadvantages:

General
Direction

Administration
and Finance

Project 1

Project 2

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None decompressor
are needed to see this picture.

Project 3

lack of specialization
continuity of work and
reallocation of people after
the project ends

Matricial
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General
Direction

Marketing

Project A

Project B

Project C

Project D

Production

Administration
and Finance

Sales

Personnel

Matricial
General
Direction

PMO

Marketing

Production

Administration
and Finance

Project A

Project B

Project C

Project D

QuickTime and a
None decompressor
are needed to see this picture.

Sales

Personnel

Matricial
Structural accommodation of projects
May or may not contain a PMO (Project Management
Office) for sharing resources, monitoring and control
Two bosses syndrome
The point is where the decisions are taken:
Weak matrix
Balanced matrix
Strong matrix

Weak Matrix
Responsibility mainly located in the functional areas
PM more as a facilitator (helps keeping focus, monitor and
control) and negotiator
Useful in structures where products are standardized but
production is complex
Facilitates an orientation of the organization towards a
project management culture

Strong Matrix
PM is responsible of:
Planning operational activities (it tells functional areas what has
to be done - in practice slightly weaker than that!)
Coordinating people
Monitoring and Controlling progresses
Friction between PM and Functional Areas:
PM focused on shorter term goals
Functional area responsible inclined to think of the lending
personnel as a favour.
Necessity of mediating requests of different projects and project
managers for the Functional Areas
Good for complex products with standard production cycles

Balanced Matrix
Something between Strong and Weak
Need for a PM
PM hasnt got all the authority of a Strong Matrix
(usually embedded in a functional unit - it may
report to the person responsible of an area)

Dedicated Team

Dedicated Team
A special unit is created for the duration of the project. PM has complete
responsibility over the planning, team, etc.
Similar to projectized organization
Example: Lockheed-Martin (sixties):
60 C54 airplanes (milliard dollars contract), 12000 pieces per airplane,
several subcontractors
Dedicated team with ~ 11000 hundred people
Disadvantages include:
Strong focus on shorter term goals
Re-allocation of people after the projects end
Integration in the company (e.g. evaluation of people, feeling of
belonging to the company)

Summing up
Functional

Weak Matrix

Balanced Matrix

Strong Matrix

Projectized

PM Authority

Little or none

Limited

Low to Moderate

Moderate to High

High to almost
Total

Resource
Availability

Little or none

Limited

Low to Moderate

Moderated to
High

High to almost
total

Who controls the

project budget

Functional
Manager

Functional
Manager

Mixed

Project Manager

Project Manager

Project Manager
Role

Part-time

Part-time

Full-times

Full-time

Full-time

Project
Management
Administrative
Staff

Part-time

Part-time

Part-time

Full-time

Full-time

A side remark
Changes in a structure are subjected to the
Organisational Lag (organizations and personnel have
hysteresis - Kerzner)
Technology/changes
organization

personnel

Strategy for introducing new

techniques (Swartz and Davis)
Strategic importance

High

Medium

Low
Resistance to change
Low

Medium

High

Strategy for introducing new

techniques (Swartz and Davis)
Strategic importance

High

Medium

Low
Resistance to change
Low

Medium

High

Projects and their Environment

The players

The players
Project
Sponsor

Project
Manager

Project
Management
Team
Project Team
Project Stakeholder

The Players
Stakeholders:
who is involved in the project and/or people whose interest may
be affected by the project

Stakeholders:
may have different influence and varying level of responsibility
during the project
may have positive or negative influence on the project
may be difficult to identify

The Players
Customer/User: person or organization that will use the results of a project.
There may be multiple layers of users.
Performing Organization: the organization mostly involved in the project
Project team members: the group performing the work
Project management team: the members of the team directly involved in
project management
Sponsor: person or group providing the financial resources
Influencers: people or groups not directly related to the project who could
influence the course of a project

The Players (ctd)

There may be overlaps among different
stakeholders (the customer may also be the
sponsor)
There are other characterisations:
Internal/external
Sellers and contractors

The Players (you)

Project Manager:
person responsible of managing the project
person responsible of managing stakeholder expectations
a negotiator and a facilitator
the reference person for a project
Some skills
communication and negotiation skills
a little predisposition to risk
goal oriented
Leadership
Summing up (according to Sernia):
Solid know-how
A lot of common sense
Professional correctness
A bit of style

The role of the PM

The PM ensures that the
project goals are met
according to the
constraints

Cost

Time
Quality

The PM and its environment

sponsor
Expectations,
resources

performing
organization

Achievable goals
Constraints, opportunities

resources
results

influencers

PM
Goals, plan,

Products,
Services, or results
requirements

customer

Achievable goals,
Information,
Commitment

project
team

Process Groups and Knowledge

Areas

Process Groups and Knowledge

Areas
Process Groups defines the activities necessary to
carry out a project
Knowledge areas organize the skills necessary to
carry out the project groups

Project Management
Integration

Initiating

Planning

Executing

Monitoring and
Controlling

Closing

Develop Project
charter and
preliminary
scope statement

Develop project
management plan

Direct and manage

project execution

Monitor and control

project work;
Integrated control
change

Close project

Project Scope Management

Scope planning, scope

definition, create WBS

Scope verification;
scope control

Project Time Management

Activity Definition,
sequencing, resource
and duration
estimation, schedult
development

Schedule control

Project Cost Management

Cost estimation, cost

budgeting

Cost control

Project Quality Management

Quality planning

Quality assurance

Quality control

Project Human Resource

Management

HR planning

Acquire project team,

develop project team

Manage project team

Project Communication
Management

Communications
planning

Information distribution

Performance reporting,
stakeholder
management

Project Risk Management

Risk Management
planning, risk
identification,
qualitative and
quantitative risk
management, risk
response planning

Project Procurement planning

Plan purchases and

acquisition; plan
contracting

Risk monitoring and

control

Request seller
responses; select
sellers

Contract administration

Contract closure