CHAPTER

ONE
• Why Do We Need Project Management
• PMBOK Guide.
• What is a Project ?
• What is Project Management ?
• Portfolio, Program and Project Management .
• Project and Strategic Planning.
• Project Management Office.
• Project Management and Operations Management.
• Organizations and Project Management.
• Business Value.
• Role of a Project Manager.

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 How the How the project How the How the How the beta How the business
customer leader analyst programm testers consultant
explained it understood it designed it er wrote received it described it
it

How the What What the How it What What the

project was operations customer was marketing customer
documented installed was billed supporte advertised really 3
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  PMBOK guides stands for ProjectManagement Body of
Knowledge.

˜A recognized standard for the project management profession.

˜ The knowledge contained in this standard evolved from the
recognized good practices of project management practitioners
who contributed to the development of this standard.
˜ The knowledge and practices described are applicable to most
projects most of the time, and there is a consensus about their
value and usefulness.
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A project is a temporary endeavor (effort) undertaken to create (deliver) a un

o Temporary
o

• Has a definite beginning and end, not an ongoing effort.

• The end is reached when the project’s objectives have been
achieved or the project is terminated (Objectives cannot be
met, funding is no longer available, etc…)
• Temporary does not mean a short duration.

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o Unique product, service, or result
o

• The product or service is different in some way from

other products or services, although repetitive
elements may be present in some projects (buildings).
• There may be uncertainties (risks) about the project, which
necessitates more professional management than routine
work.

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o Progressively Elaborated
o Characteristics are known in advance.
o Steps are Defined
o Steps may be revisited and often
refined

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A project can deliver :
o A unique product that can be either a component of
another item or an end item in itself.
o A unique service or a capability to perform a service
(business function that supports production).
o A unique result such as an outcome or document
(research project).
o A unique combination of one or more products, services,
or results (a software application, its associated
documentation, and help desk services).

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 ˜A project is aimed at moving an organization from one state
to another state in order to achieve a specific objective
˜ Before the project begins, the organization is in “Current
State”
˜ The desired result of the change driven by the project is
described as “Future State”

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  PMI defines business value as the net quantifiable benefit
derived from a business endeavor.
˜ The benefit may be tangible, intangible, or both

 Examples of tangible elements include:

o Monetary assets
o Market share
˜ Examples of intangible elements include:
o Brand recognition
o Trademarks
o Reputation

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 Organizational leaders initiate projects in response to
factors acting upon their organizations.
 There are four fundamental categories for these factors,
which illustrate the context of a project
o Meet regulatory, legal, or social requirements;
o Satisfy stakeholder requests or needs;
o Implement or change business or technological strategies; and
o Develop, improve, or fix products, processes, or services.

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 PMI
Definition:
“The application of Knowledge , Skills, Tools, and
Techniques to Project activities to meet the Project
requirements”.

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 Effective and efficient project management should be considered
a strategic competency within organizations. It enables
organizations to:
o Tie project results to business goals,
o Compete more effectively in their markets,
o Sustain the organization, and
o Respond to the impact of business environment changes on
projects by appropriately adjusting project management plans.

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 Program Management
o A group of related projects, subprograms and program
activities managed in a coordinated way to obtain benefits
and control not available from managing them individually.
o

o Projects within a program are related through the common

outcome
or collective capability.

o Focuses on the project interdependencies helps to determine

the optimal approach for managing them.

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 Portfolio Management
o A collection of projects, programs, subportfolios and
operations managed as a group to achieve strategic
business objectives.
o

o The projects or programs of the portfolio may not be

necessarily interdependent or directly related.
o

o Identifying, prioritizing, authorizing, managing, and

controlling projects and programs, to achieve specific
strategic business objectives.

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 Operations management is responsible for overseeing, directing,
and controlling business operations.

 Operations evolve to support the day-to-day business, and

are necessary to achieve strategic and tactical goals of the
business.
 Examples include: production operations, manufacturing
operations, accounting operations, software support, and
maintenance.

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  Changes in business operations may be the focus of a
dedicated project (Modifying a production line).

 Ongoing operations are outside of the scope of a project.

 Projectscan intersect with operations at various points during
the product life cycle, such as:
o At each closeout phase;
o When developing a new product, upgrading a product, or expanding
outputs;
o While improving operations or the product development process.
o At the end of the product lifecycle
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 Operational Stakeholders in Project
Management
 They must be appropriately engaged in all project
phases to express their needs and to define their
influence (+ve or –ve).

 Examples of operational Stakeholders:

o Plant operators.
o Manufacturing line supervisors.
o Help desk staff.
o Production system support analysts.
o Customer service representative.

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 Project Constraints

1. Scope
2.
o what work will be done as part of the project?
o What unique product, service or result does the customer or sponsor expect
from the project?
o How will the scope be verified?
3. Time
4.
o How long should it take to complete the project?
o What is the project’s schedule?
o How will the team track actual schedule performance?
o Who can approve changes to the schedule?
5. Cost
6.
o What should it cost to complete the project?
o What is the project’s budget?
o How will costs be tracked?
o Who can authorize changes to the budget?
Figure 1-1 The Triple Constraint of Project Management
 OPM is a strategy execution framework
 Instead of executing projects randomly, you’re improving
your processes and tying projects to your business strategy
and needs.

 You’re making sure that your company focuses on projects

and programs that support your organization’s goals.
 And when you do, you get better performance, better results,
and a sustainable competitive advantage in the marketplace.

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 Projects are often utilized to achieve objectives within an
organization’s strategic plan, they are usually utilized as a
result of:
o Market demand ( economic car design)
o Business need (upsizing of an organization)
o Social need (Bibliotheca Alexandrina)
o Environmental Consideration (water
treatment)
o Customer Request
o Technological advance (Samsung Vs. Apple)
o Legal requirement (infra structure)

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A project Management Office (PMO):
is a structure that standardizes the project-related
governance processed and facilities of sharing resources,
methodologies, tools and techniques among an
organizations.
 Its role may be supportive (consultative),Controlling
or
Directive (higher degree of control).
 PMO’s Primary function is to support PM in :
o Managing shared resources across projects in its domain
o Project Management methodology, best practices and
standards
o Coaching ,mentoring, training and oversight
o Project policies, procedures and templates
oo Managing communications across projects
Project audits 5
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Project Life
Cycle
 is the series of phases that a project passes through
from its start to its completion.
o the management and control needs of organization.
o organizations involved in the project.
o the nature of the project itself.
o area of application.

 Providesthe basic framework

for managing the project,
regardless of the specific work
involved.
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A Project Phase is a collection of logically related project activities that cu

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Sequenti
al

Overlappi
ng

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 Scope, Time and cost are determined early in the project.

 Each project phase focus on a subset of project

activities and project management processes.

 The work performed in each phase is different in nature

to that in preceding and subsequent phases.

 It is preferred when the deliverable is well understood.

 Predictive life cycles may also be referred to as
waterfall life cycles.
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 The project scope is generally determined early in the
project life cycle
 Time and cost estimates are routinely modified as the
project team’s understanding of the product increases.
 Iterations develop the product through a series of
repeated cycles, while increments successively add to
the functionality of the product.
˜ Useful to reduce project complexity when managing
scope changes or when partial delivery of product is
beneficial.
˜ An iterative process is one that makes progress
through successive refinement.
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  The deliverable contains the necessary and
sufficient
 The capability
deliverable to be considered
is produced complete
through a series only
of iterations
after
that the final add
successively iteration.
functionality within a predetermined
time
˜ Anframe.
incremental process is one in which software is built
and delivered in pieces. Each piece, or increment,
represents a complete subset of functionality.

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  Change-driven (agile) methods that are intended to
respond to high levels of change and stakeholder
involvement.
 They are iterative and incremental but iterations are
very rapid and fixed in time and cost.

 Atthe end of each iteration, the product should be ready

for review by the customer.
 The sponsor and customer representatives
should be continuously engaged to provide timely
feedback on deliverables.
 Preferred in rapid changing environments when
requirements and scope are difficult to define in
advance.
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  The project life cycle is managed by executing a
series of project management activities known as
project management processes.
 Every project management process produces one or
more outputs from one or more inputs by using
appropriate project management tools and techniques.

 The output can be a deliverable or an outcome.

 Outcomes are an end result of a process.

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 Processes generally fall into one of three categories:
o Processes used once or at predefined points in the project.
o Processes that are performed periodically as needed.
o Processes that are performed continuously throughout the
project.
 Projectmanagement is accomplished through the
appropriate application and integration of logically
grouped project management processes
 The PMBOK® Guide groups processes into five categories
called Process Groups.

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  It consists of those processes performed to define a new project or a ne
 The initial scope is defined and initial financial resources are committe
 Thethe
PM project are identified.
will be selected.
 This information is captured in the project charter and
stakeholder register. When the project charter is
approved, the project becomes officially authorized.
 Involving stakeholders during initiation generally
improves the probability of shared ownership,
deliverable
customer acceptance, and
and other stakeholders satisfaction.
 Itconsists of those processes performed to establish
the total scope of the effort, define and refine the
objectives, and develop the course of action
required to attain those objectives.
 Itdevelop the project management plan and the
project documents that will be used to carry out the
project.
 As more project information or characteristics are
gathered and understood, additional planning will likely
be required.
 Significant changes occurring throughout the project
trigger a need to revisit one or more of the planning
processes and possibly some of the initiating processes.
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 Itconsists of processes performed to complete the work
defined in the project management plan to satisfy the
project specifications.

 During project execution, results may require planning

updates and rebaselining. This may include changes to
expected activity durations, resource productivity and
availability.
 Theremay be change requests , that if approved, may
modify the project management plan or other project
documents.
A large portion of the project’s budget will be
expended in performing the Executing Process Group
processes. 7
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 Itconsists of those processes required to track, review,
and orchestrate the progress and performance of the
project; identify any areas in which changes to the plan
are required; and initiate the corresponding changes.
 Project performance is measured and analyzed at regular
intervals, appropriate events, or exception conditions to
identify variances from the project management plan.
 Controlling changes and recommending corrective or
preventive actions.
 Influencing the factors that could circumvent integrated
change control or configuration management so only
approved changes are implemented.
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 It
consists of those processes performed to conclude all activities across all Project Man
contractual obligations.

 At project or phase closure, the following may occur:

• Obtaining acceptance by the customer or sponsor to formally close
the
project or phase,
• Conducting post-project or phase-end review.
• Recording impacts of tailoring to any process, documenting
lessons learned and applying appropriate updates to OPA.
• Archive all relevant project documents in the project
management information system (PMIS) to be used as
historical data.
• Close out all procurement activities ensuring termination of all
relevant agreements
• Perform team members’ assessments and release project resources.
  Inaddition to Process Groups, processes are also
categorized by Knowledge Areas.
 A Knowledge Area is an identified area of project
management defined by its knowledge requirements and
described in terms of its component processes, practices,
inputs, outputs, tools, and techniques.

 The ten Knowledge Areas described in this guide

are:
Project Project Project Project Project
Integration Scope Schedule Quality
Cost
Manageme Manageme Manageme
Manageme nt nt Manageme nt
nt nt

Project Project
Project Project Project
Resources Communicati Stakeholde
Manageme o n Risk
nt Management Procureme r
Manageme nt Manageme
nt 7
Manageme nt
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nt
 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, scope statement, and WBS (scope)

Gantt charts, network diagrams, critical path analysis,
critical chain scheduling (time)
Cost estimates and earned value management (cost)
  A methodology
 Project managementismethodologies
a system of practices,
may be: techniques, procedures, and ru
o
This definition
Developed
 makes
by experts withinit clear
the that this guide itself is not a methodology
organization,
o Purchased from vendors,
o Obtained from professional associations, or
o Acquired from government agencies
 Tailoring
is necessary because each project is unique; not
every process, tool, technique, input, or output identified
in the PMBOK® Guide is required on every project.
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  The project manager needs to ensure that the project management app

 Projectmanagers should appropriately tailor the noted

project management documents for their projects.
 In some organizations, the business case and
benefits management plan are maintained at the
program level. 8
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  The project business case is a documented economic
feasibility study used to establish the validity of the
benefits of a selected component lacking sufficient
definition
 It is used as a basis for the project authorization
 The business case lists the objectives and reasons for
project initiation.
 It helps measure the project success at the end of the
project against the project objectives.
 The business case may result in a go/no-go decision
for the project.

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 The project benefits management plan is the document
that describes how and when the benefits of the project
will be delivered
 Itdescribes the mechanisms that should be in place to
measure those benefits.
 A project benefit is defined as an outcome of actions,
behaviors, products, services, or results that provide value
to the sponsoring.

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 Itmay include but is not limited to documenting the
following:
Target benefits (e.g., the expected tangible and intangible value to
o

be gained by the implementation of the project; financial value is

expressed as net present value);
o Strategic alignment (e.g., how well the project benefits align
to the business strategies of the organization);
o Timeframe for realizing benefits (e.g., benefits by phase, short-term,
long- term, and ongoing);
o Benefits owner (e.g., the accountable person to monitor, record,
and report realized benefits throughout the timeframe
established in the plan);
o Metrics (e.g., the measures to be used to show benefits realized,
direct measures, and indirect measures);
o Assumptions (e.g., factors expected to be in place or to be in
evidence);
o Risks (e.g., risks for realization of 8
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 Traditionally, the project management metrics of
time, cost, scope, and quality have been the most
important factors in defining the success of a project.
 Project stakeholders may have different ideas as to
what the successful completion of a project will look
like and which factors are the most important.
 It is critical to clearly document the project objectives
and to select objectives that are measurable.
 Three questions that the key stakeholders and the
project manager should answer are:
o What does success look like for this project?
o How will success be measured?

o What factors may impact success? 8

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  Projectsuccess may include additional criteria linked
to the organizational strategy and to the delivery of
business results.
 These project objectives may include but are not
limited to:
o Completing the project benefits management plan;
o Meeting the agreed-upon financial measures documented in the
business
case. These financial measures may include but are not limited to:
•

• Net present value (NPV),

• Return on investment (ROI),
• Internal rate of return (IRR),
• Payback period (PBP), and
• Benefit-cost ratio (BCR).
Fulfilling contract
oo Acceptable terms and conditions;
customer/end-user 8
adoption;
oMeeting organizational strategy, goals, and objectives; 5
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