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1: The Concept of Project Management

Contents 1.1 Introduction 1.2 The history of project management 1.3 The nature of project management 1.4 The project management standards 1.5 BS 6079 – Guide to project management 1.6 The role of the construction related project manager 1.7 Summary

Heriot-Watt University

Unit 1-1

McGraw Hill.1 Introduction Learning outcomes from this unit This unit is intended to introduce you to the main concept and philosophy of project management. 1-34. Recommended text for Unit 1 The reading from the recommended texts for Unit 1 is: Winch GM . 2008 Ch1. An Information Processing Approach 2nd Edition. Kerzner. 7th Edn. Inc. J Wiley & Sons. Wiley-Blackwell. 3rd Edn. Wiley-Blackwell. Surveyor Court: Coventry. Boston. 3-19. By the time you have finished Unit 1. ISBN: 978-1-4051-9420-4 Heriot-Watt University Unit 1-2 . ISBN 978-1-118-02227-6.. Gray. the role and contribution of a construction client‟s professional project manager. p.A Systems Approach to Planning. Select relevant sections in Ch 1.Project Management: The Managerial Process. ISBN 1-4051-8457-1 Ch 1 p. Ch. 5th Reprint. 4. RICS. 1. CIOB (2010) Code of practice for Project Management for Construction and Development.1. London W4 4AL. and ISO 10006: Guidelines to quality in project management via Customer Services. British Standards Institution 389 Chiswick High Road. ISBN: 0-580-48144-1. CF and Larson EW . their uses and purposes and the role of the construction related project manager The role and contribution of a construction client‟s professional project manager in typical construction project teams How construction related project management differs from normal management processes 3. ISBN 978-1-4051-6802-1. British Standards Institution 389 Chiswick High Road.Engineering Project Management. the use and purpose of the main project management standards. H (2013) . John Wiley. you should be familiar with: 1. Burke Publishing ISBN-13: 978-0-9582-7334-3. Phone: +00 44 020 8996 9001 PD 6079-4 Project Management – Part 4: Guide to project management in the construction industry. Blackwell Publishing. PMI. London W4 4AL (2006). pages 1-38. BS6079: A Guide to Project Management Practice. Select relevant sections in Ch 1 and Ch 2 Burke. R . 2. The reading from the recommended background texts for Unit 1 is any of the following: Smith N J . 11th Edn. Ch 1. The concept of project management in the context of construction projects The project management standards (APM. RICS (1999) Conditions of Engagement for Consultant Project Management Services. 4th Edn.3-21. p. 5th Edn.Project Management Techniques.Managing Construction Projects. Meredith JR and Mantel SJ – Project Management: A Managerial Approach. Ch 2. (2010). CIOB) and BS6079. Scheduling and Controlling.

This was the first really complex. namely „to add significant and specific value to the process of delivering construction projects.uk for further information on the two institutes.org. It was seen that there was a need for a highly dedicated and well-developed team to work together on such projects.1. it became associated with a particular set of project control tools and techniques – most notably critical path analysis which held back its further development and application to construction. as a discipline was essentially a spin off from the atomic bomb development program. high technology project to be operated by mankind. However. Conventionally. in order that the required standards could be delivered on time and within cost. Prince2 is the current standard promoted by the APM in the UK. Examples included the design and construction of the Polaris nuclear submarine fleet for the US Navy. However. in Europe this was the responsibility of the „master of the works‟.pmi. APM also certifies professional project managers. The PMI offers Project Management Professional certificate to members. Project Alamos. Gradually the concepts of project management emerged and became diffused into the construction industry so that today it is seen as being associated with the management of the total project throughout its lifecycle. This is achieved through the application of a set off generic project – Heriot-Watt University Unit 1-3 .3 The nature of project management The CIOB (2010) sets out the purpose of project management in the following terms. The APM produced its Body of Knowledge in 1988 (regularly updated – now 5th Edition in 2009). These documents are British and European standards for project management practice and in many ways mark the frontiers of the development of the discipline as a profession today. in the 1940s. These certificates are valued by several large organizations.org and www. Visit: www. In the USA. the Project Management Institute (PMI) has developed a similar publication. and assisted greatly in the preparation of BS6079 in 1996 and ISO 10006 in 1997 (The current version of ISO 10006 is the 2003 version). 1.apm. This requirement was reinforced with the development of several major military projects through the 1950s. Their guide document on project management PMBOK is used in many parts of the world.2 The history of project management Construction projects have been „managed‟ since societies first developed the skills required to construct. the emergence of a concept of project management is a phenomenon of the twentieth century. Project management. APM and PMI issue certificates for professional project managers after completing relevant study and examination. The discipline developed until the Project Management International (PMI) in the US and the Association for Project Management (APM) in the UK were formally instituted in the 1960s.

bridges. A projects success can be measured in terms of how closely it has met its predetermined objectives. It is clear that construction related projects are organised works that need to be produced in context of pre defined goals or objectives. quality and performance” (BS 6079) It revolves around the management of planned change and in the context of construction projects with problems in the lack of information it revolves around making robust decisions to affect the creation of value” (Winch) Heriot-Watt University Unit 1-4 .        a project is a unique undertaking: each one will differ from every other in some respect projects have specific objectives (or goals) to be achieved projects require resources projects have budgets projects have time schedules projects require the effort of people measures of quality will apply Construction related projects are executed in an atmosphere of risk and uncertainty. The CIOB assert that project management processes can be applied to all construction projects but that for smaller or less complex projects the role may well be combined with another discipline e. In addition construction projects need to have concern for sustainability and the health and safety of all project participants and stakeholders. Amongst other definitions of project management are the following. Projects have been defined by a number of authors but in general they can be said to contain some or all of the following characteristics. „the application of knowledge. monitoring and control of all aspects of a project and the motivation of all those involved to achieve the project objectives on time and to cost. Projects can vary in range. Increasingly construction related projects are looking to establish a single point of responsibility for clients and this is a role most often taken by the project manager. time. quality and participant satisfaction (PMI) the planning. size and shape from large multi-million pound infrastructure works such as road. tools and techniques to project activities in order to meet stakeholders needs and expectations from a project‟ (APMBoK) The art of directing and coordinating human and material resources throughout the life of a project by using modern management techniques to achieve predetermined objectives of scope.g. airports that take years to complete to small domestic projects with restricted budgets that take just a few weeks to complete. skills. cost.orientated management principles throughout the life of the project‟. the design team leader.

This approach tends to lead to a problem referred to as sentience. In addition. the lead consultant manages windows or snapshots. and closing a process that involves resources such as labour. Project management differs from other traditional management disciplines in several ways. Traditionally. cost and quality over a period of time that allows for process repetition. the lead consultant is educated as a designer but acts in a management capacity. varied and wide technical knowledge. a project is a known objective with some form of parameters or limits applying to it. preferably in a number of different industries. The definition of “project” is more difficult.What is clear is that project management and the application of its tools and techniques have moved progressively from concentration upon the problems apparent at the execution or tail end of a project towards problems found at the front end …. operation. thorough understanding of project management objectives. As such.. there has been little direct involvement of lead consultants in commissioning. In other words. Conventional specifically trained management practice concerns itself being completely responsible with initiating. materials and plant in order to deliver a product within recognised constraints of time. executing. Classic project management skills are required. backed up with experience of how projects evolve from the earliest inception stages to final completion and commissioning (close out). In construction. One consultant might be appointed to carry out the feasibility study. and a wide knowledge. quality and timing of the project delivery commissioning and accepting the project Project management is the managerial responsibility and actions involved in accomplishing a project on time. from downstream to upstream…. This problem centres on the Heriot-Watt University Unit 1-5 . The project manager is responsible for all aspects of the management system required in order to achieve these objectives. but not the whole lifecycle. The Construction Industry Council (2000) defined the nature of project management in the construction industry as being concerned with         defining the business need producing a project delivery strategy project briefing processes evaluating and managing project risks managing the design of the project procuring resources and skills to deliver the project controlling project costs. These include good all round management skills. and as such project management in construction now needs to engage in the whole process that starts from project inception and continues with many interactions with differing organisations to conclude with the commissioning and operation of the completed built environment asset. lead consultants are traditionally appointed to cover sections of the overall lifecycle project.. decommissioning and recycling.. controlling. planning. while another might be appointed to manage the design and construction processes. a lead consultant who is usually an architect or civil engineer traditionally manages projects. In the simplest form. Generally all projects evolve through a similar process and through identifiable cycles. in budget and to the specified quality standards.

For instance consider. there has been no real standardisation of practice for professional consultants. Project management is about providing a specialist who can provide combined time. and communicate clear objectives for a project and all phases of a project risks – it would be necessary to identify. within cost and to the required standards of performance in the context of sustainability and within the constraints of consideration for health and safety for project participants and other stakeholders. with no specific discipline related skills other than general project management skills. (i) (ii) (iii) (iv) (v) define project objectives . The objective of project management may be defined as the successful completion of the project. Project management attempts to address some of these restrictions. It is asserted that this traditional approach causes conflicts to appear in the service such professionals offer to their clients. There have been the professional bodies and their codes of conduct. using national and international standards of professional practice. The use of project management processes and the appointment of a project manager.it would be necessary to establish. Also as the project management process identifies the project manager as the person with single point responsibility for project success then clients can assess project performance on a more transparent basis. rather than designers acting as managers. It is about managing the project from inception to operation (and even decommissioning in some cases) through an agreed and complete project lifecycle. assess and assign risks to aid management of the construction delivery processes timely decision making – it would be necessary for instance to agree / signing off designs / plans prior to the project production phase initiating project planning – it would be necessary to allocate appropriate resources to planning to achieve efficient production time and money – it would be necessary to consider resource allocation and evaluation as a joint item as value can be achieved if rewards of project production at a fast pace outweigh the extra costs involved project team – it would be necessary to have/build a committed team associated with project success and so it would be necessary to seek to achieve commitment in team where the main risks are located control . but there has never been any real attempt to standardise how projects are set up and managed or what cost control systems are used and so on. on time. It replaces the traditional diversified project teams led by a designer acting as a manager. It is about using fully trained project management professionals to run projects. Traditionally.project being led by built environment professionals who are concerned with their own discipline related issues as well as the delivery of successful project management. cost and quality control. define. Given the wider role of construction related project management it is necessary to consider the following issues so as to ensure that project success can be achieved …. can combat this problem of sentience.it would be necessary to consider resource requirement so as to have it minimised especially if planning has been properly effected (vi) (vii) Heriot-Watt University Unit 1-6 . with a coherent project team led by a professional project manager.

now increasingly to deliver organisational and business management success is being supported by the establishment of benchmark standards that are being identified by the differing project management organisations. It establishes the standards and areas of responsibility for project managers in all industrial sectors. Project management practice is anchored on national and international standards. p. It is interdisciplinary and is applicable to all industries. clients etc personal development – it would be appropriate to ensure resource was made available for training.10) details the benefits of project management and students are referred to that source for an extensive list of potential benefits of construction project management over more conventional methods of construction project delivery. The basis of such professional Heriot-Watt University Unit 1-7 . and the development of competencies for project managers. BS6079 and the related ISO 10006 are UK and EC benchmarks for generic project management practice. personal reflection and professional development Burke (2003. Organisations such as the International Project Management Association (IPMA) and the Project Management Institute (PMI) are involved in identifying the contribution that effective management of projects can make to business success. RICS and the CIOB are the professional bodies that operate in the UK and which are in competition to become established as the principal professional body for construction related project managers. The APM‟s view is that BS6079 will go on t o become an EC wide standard for project management. These standards act together to set international standards. and their relationship with project management The approach of project management to deliver projects and through such successful projects. The RICS also produce their own conditions of engagement for consultant project managers (see later material) and the CIOB have also produced a guide to construction project management. They set national and international standards for practice while still being heavily based on APM approaches.(viii) (ix) (x) (xi) organisational learning – it is recognised that project success would be more likely if organisational learning from experience of other projects can be captured and disseminated contract strategy – it should be considered whether contracts to be used can motivate and identify risks/and reward processes should be made explicit external environment – it will be necessary to ensure that all decision makers are aware of and can accommodate change caused by market circumstances. There are several standards in use around the globe but in the UK the major standards that are used as the basis for professional construction related project management practice are the Association for Project Management (APM) Body of Knowledge and the BS 6079 and ISO10006.4 The project management standards. The APM Body of Knowledge is the UK equivalent of the US (PMI) model. 1. performance appraisal. team building. As such it is a general document. The APM.

Safety & Environment Work Content & Scope Management Time Scheduling Resource Management Budget & Cost Management Change Control Earned Value Management Information Management Design Management Cycle Design Management Post Project Evaluation Review Organisational structures Communication Teamwork Project Leadership Conflict Management Human resource management Hand-over management Configuration management Financial Management Procurement Given the above it can be seen that the material in this module cannot cover the full range of topics addressed in project management processes and so the student needs to appreciate that the module addresses only the core areas of project management processes as applied in typical construction projects. The lists below indicate the differing areas of knowledge that each of the above consider as being relevant to the professional construction project manager. The student is recommended to access the current APM Book of Knowledge and become familiar with the standardised generic processes advocated there for the management of projects in general. the leading professional body for built environment professionals operating in the UK and increasingly around the world now recognise project management as a separate faculty within the Institution which has its own specialist skills. The approach advocated in BS 6079 is the approach that underpins the material and its consideration in the rest of this module. knowledge and practices. PMI BoK (2004) P M Framework P M Process Project Scope Management Project Cost Management Project Human Resources Management Project Risk Management P M Context Project Integration Management Project Time Management Project Quality Management Project Communication Management Project Procurement Management APM . Heriot-Watt University Unit 1-8 .Handbook for Project Managers (2009) Project context Life Programme management Cultural influences Project success criteria Strategy/Project Plan Value Management Risk management Quality Management Health. The RICS.competencies is being established by the PMI and the Association of Project Management (APM).

The PMP/PEP is also a control document that addresses organisations. a procurement strategy. BS 6079 and the APM BoK indicate that a key project management tool is the generation and application of a strategic planning document for the project. It would be useful to be able to measure how well a design team has performed in relation to the fees that have been paid.1. The standard establishes a standard generic project plan that is applied to all projects. a work breakdown structure (WBS). this is not possible because of the levels of information in the system. a task responsibility matrix (TRM). This has obvious drawbacks. recording. environmental. projects can be set up and run in any form that the individual manager responsible considers best. cost planning and control. It makes it very difficult for anyone to evaluate project performance and individual project team performance. at least in part. An agricultural project would therefore be set up in exactly the same way as a construction project. The PMI and ISO10006 use another term for this document namely a „project execution plan (PEP)‟. and even members of the same design professions may have different approaches to designing and recording information. Nonetheless it is a key strategic planning tool and it usually contains a number of core aspects such as a statement of works (SOW). The PMP/PEP is a live document that is subjected to revisions as the project itself develops. The following are the main sections of a basic PMP/PEP indicated by BS6079. A preliminary PMP/PEP can be prepared as part of the assessment of a project‟s business case. BS 6079 is an important document. The PMP/PEP can be produced in „draft‟ form as part of the project scope management process and in „final‟ form as an action planning/taking document once the client or project sponsor has given final approval for the project to proceed.5 BS 6079 – Guide to Project Management BS6079 is the British Standard Guide to Project Management. and the difficulties involved in being able to isolate individual performance characteristics when there are so few constants. support processes. The philosophy of the PMP is based on standardisation. Once authority has been given to go ahead with the project then the PMP/PEP can be expanded to match the level of emergent project information. This document is the generic or master/strategic project plan (referred to as a PMP or SPP). an organisational breakdown structure (OBS). At present. and a programme for the works. There is no standard requirement for document preparation. or even of quality control. health and safety systems. but the sections on the recommended format for the PMP are extremely important. It is a very detailed summary of current international project management processes. Projects are set up and executed in numerous different ways both between industries and within the same industries. The PMP/PEP is a master plan that develops the details of the strategic stages of a projects lifecycle and provides a baseline for anticipated costs and time /programme against which the consequences of changes can be evaluated. namely (a) (b) Introduction and summary Commitment (budgets) and acceptance procedures Heriot-Watt University Unit 1-9 . because there are so many unknown variables. At present. BS 6079 attempts to address this problem. Each organisation has its own procedures.

project policy and project approvals. project resource management. such as. reliability management. project diary In summary the PMP/PEP will identify significant project milestones such as. staff organisational chart. It must be remembered that Heriot-Watt University Unit 1-10 . programme management. staff directory. project harmonisation. configuration management. It is usual to find on many construction projects that there is more than one person whose role is described as being a „project manager‟. In construction. risk management. test and evaluation. obtained and a design generated and approved  The resources for the production of the project need to be identified. procurement strategy. sizes and orientation. obtained and managed to construct.  The identification and agreement on project objectives and success criteria  The amount of physical and financial resources needed for the project  The plan of action for the project  The resources for the design need to be identified. introduction. environmental issues. summary. commission and pay for the project A more detailed consideration of the contents and sections within a strategic PMP/PEP is provided in the next section of this module. integrated logistics support. consultant design organisations. acceptance procedure. financial management. project implementation strategy. project description (SOW). project managers can be employed by firms and organisations employed in small sized sub contactor and supplier organisations.  1. project team organisation.6 The role of the construction related project manager Project managers are increasingly being recognised and employed in organisations of differing types. 2. contents. title page. project organisation. as well as within their own specialised project management consultancy. management reporting systems. communications management. This can cause confusion to students of project management. Self assessment questions: What is the international significance of BS6079? What are the obvious drawbacks of a practice standard? 1.(c) (d) (e) (f) Project work breakdown structure (WBS) Organisational breakdown structure (OBS) Schedule or programme A statement of work (SOW) Generic or strategic project master/execution plan (PMP/PEP) to BS 6079 A more detailed and comprehensive PMP/PEP for a more complex project contains the following sections which are detailed in BS 6079. contract management. work package sub contractors and principal contractors. aims and objectives. health and safety management. distribution and amendment record.

Similarly many of the larger sub contractors will employ a project manager to coordinate their activities and liaise with the project managers of the principal contractor. Statutory compliance 13. Programming 10. Cash flow 12. Site selection 3. Other consultant appointments 7. Tenancies and fitting out The RICS conditions of engagement make it clear that although consultant project managers could be involved in all of the above areas of service provision it is more likely that their services actually required on many projects would be tailored from the above list to suit the particular project circumstances. commissioning and maintenance 16. Brief. and delivery of the project as well as the integration of the project within the clients other business activities. For instance the principal contractor will normally have a project manager and perhaps assistant project managers resident on the site. Given the issues indicated as being relevant by the differing Project Management standards and guides reviewed above it can be seen that the role of the project manager involves using a systematic approach to . It is this role that that this module assumes as its focus. Contract procedures 14. Construction economics & financial management 11. quantity surveying. namely 1. 1999). Building management.... Capital budgeting 2.project management is concerned with generic processes that can be applied wherever the project management practitioner is located.       ensure the project is clearly defined and understood by all enable the project objectives to match the business objectives of the sponsor organisation allow responsibilities for different parts of the project to be understood. design and quality control 8. safety. In construction projects it is normal to find project managers acting for differing participating organisations. Such lead or client‟s project managers can be located in their own consultancy or are drawn from other large multi disciplinary consultancies that provide services such as design.. valuation & funding 5. Agency. set out the services that professional construction project managers could be involved with. This role is increasingly being undertaken by consultant professional project managers. management. Increasingly client organisations will also have their own professional project managers who are concerned with the overall planning. Reporting and meetings 9. Project analysis & feasibility studies 4. allocated and agreed adopt a logical approach to planning & estimating resources provide a consistent means of monitoring and controlling progress provide reassurance by demonstrating visible control Unit 1-11 Heriot-Watt University . Legal services 6. Contract management 15. depending on the size and complexity of the project. and planning supervision for their construction clients.. The RICS. in their Conditions of Engagement (RICS.

the finance available and interest rates may well influence the size and scope of the project. including: economic climate. political and environmental issues and how these affect the project.In general terms the project manager is also responsible for …. External or environmental factors may necessitate design cuts or savings in the later stages etc. It includes everything around the project that could influence it. The project manager therefore needs to have a reasonable understanding of the current economic.        project definition & milestones overall project budget strategic project plan (SPP) & work breakdown structure (WBS) & Task responsibility matrix (TRM). and the way in which it develops. investment levels. The project manager has to have wide “general” knowledge covering subjects outside the area of management specialism. legal etc. A professional consultant project manager can manage the project on behalf of the client from inception to completion and occupation. In construction project teams.107-133. Each of these factors will have some influence on the project at each stage. Architect The architect does the main design work. political factors. BS6079 indicates that the project manager is the individual with the responsibility for managing the project to specific objectives. labour market. For example. together with any social. Again. Then Heriot-Watt University Unit 1-12 . it is preferable if the project manager has this knowledge and experience in relation to more than one industry. draft master plan (DMS) task definitions & responsibility charts performance reports – time and cost quality standards – related to project process and product end of phase & project review reports The role of the project manager is addressed in detail in Chapter 3 of Meredith and Mantel‟s book p. The project manager has to be aware of all environmental factors and the ways in which they can affect the project. (S)he is in charge of the project team and is responsible for the successful conclusion of the project. (S)he is usually a professionally qualified member of The Royal Institution of British Architects (RIBA) in the UK. the project manager is specifically qualified and experienced in project management. The project manager and the project environment The project environment is the context within which the idea and reality of the project are achieved and developed. the main players are likely to be: Project Manager Increasingly. levels of economic activity. and produces the design drawings and schedules up to the award of the contract. legal or aesthetic influences that may have an effect.

procure sub contractors and prepare payment claims. like the architect. in the UK. Quantity surveyors can also work for contracting organisations to cost plan. agreeing interim payments right through to the settlement of the final account. structural or services works. a services co-ordinator (on complex services projects) and a CDM Coordinator (CDM regulations. then monitors expenditure through the construction phase. Project Sponsor BS6079 indicates that this is an individual or body for whom the project is undertaken and who is the main risk taker. The QS prepares the bills of quantities and issues them to tendering contractors. carrying out on site inspections as required by their contract.variation or change orders are issued (in some cases) and the architect is responsible for inspections etc right through the construction phase. They are usually professionally qualified and. providing revised estimates. They undertake engineering design work and. They may be responsible for the entire project or they may be responsible for parts or sections of the project. The surveyor monitors the cost of the design as it develops. The QS checks the priced bills and recommends on the award of contract. The construction managers are professional people who are usually members of the Chartered Institute of Building (CIOB). who are usually members of the RICS and who are concerned with altering and refurbishing existing buildings. are members of The Institution of Civil Engineers (ICE) or members of The Chartered Institute of Building Services Engineers (CIBSE). They can be members of the project team and so be the direct parties to a contract. Engineer Engineers design civil. Stakeholders can also be indirect in that they are part of the community in which the project is situated. Construction Managers The construction managers are usually employed by contracting organisations and they are responsible for the production of the construction project on the site. Others Individual teams may involve other specialists such as building surveyors. Quantity Surveyor The quantity surveyor (QS) is responsible for cost planning and control (cost management). He or she is usually professionally qualified and in the UK is a member of The Royal Institution of Chartered Surveyors (RICS). Heriot-Watt University Unit 1-13 . 2007). produce additional designs for variation orders. Increasingly the construction managers are responsible for planning and programming the works and liaising with the domestic and nominated sub contractors who are employed to undertake specified sections of the project. The project sponsor can be thought of as the client organisation(s) although the project sponsor can also be the individual representing the client organisation/sponsoring body and to whom the project manager reports. The statutory/planning system in place in the project location can also be indirect stakeholders in that they can have influence over the project. Stakeholders of the project are those who have the potential to influence the course of a project.

RICS. Make the case for a project management consultancy rather any other type of consultancy to be appointed as the lead consultant for the project. and the role and contribution of the client‟s project manager as well as other members of a construction project team. 2. CIOB and BS 6079). The unit has considered the contents and uses of the project management standards (APM. Explain what project management is and set out the benefits of applying it to a large scale complex construction project instead of using a conventional design consultant as the lead consultant. 4. the problem of sentience in construction project management.6 Summary This unit has introduced the main concepts of project management in the context of construction projects. An international banking organisation is the client for a large.  Self assessment questions 1. Heriot-Watt University Unit 1-14 . PMI. commercial city centre refurbishment project and it is unsure about using consultant project managers as the lead consultants for this project.1. 3. their uses and purposes. Consider project management and general management and set out the major differences between the two concepts. complex. Outline the role and responsibilities of the client’s professional project manager.