Dr.

Rameez Khalid, PMP

Faculty, Department of Management
Institute of Business Administration, Karachi
 Whether to Use Formal PM?

• By 1970s and 1980s, more and more companies

departed from informal to formal PM.
– Are the jobs complex?
– Are there dynamic environmental considerations?
– Are the constraints tight?
– Are there several activities to be integrated?
– Are there several functional boundaries to be crossed?

Evolution of PM rameezkhalid@iba.edu.pk 3
 Major Problems of PM
• Project priorities and competition for talent may
interrupt the stability by upsetting the normal
business of the functional organization.
• Long-range planning may suffer as more focus on
fulfilling the requirements of temporary projects.
• Shifting people from the project to project may
hinder employees’ growth and development
within their fields of specialization.

Evolution of PM rameezkhalid@iba.edu.pk 4
 Imperatives
1.Time span between project initiation and completion
appears to be increasing.
2.Capital committed to the project prior to the use of the
end item appears to be increasing.
3.As technology increases, the commitment of time and
money appears to become inflexible.
4.Technology requires more specialized manpower.
5.Inevitable counterpart of specialization is organization.
• Above five “imperatives” identify the necessity for more
effective planning, scheduling, and control.
Evolution of PM rameezkhalid@iba.edu.pk 5
 Early Reasons For Failure
• There was no need for project management.
• Employees weren’t informed about how PM works.
• Executives selected inappropriate projects or
project managers for the first few projects.
• No attempt to explain the effect of the PM Org.
Structure on the wage and salary administration.
• Employees were not convinced that executives
were in total support of the change (to PM).

Evolution of PM rameezkhalid@iba.edu.pk 6
 Driving Forces for PM

Capital projects
Customer expectations
Competitiveness
Executive understanding
New product development
Efficiency and effectiveness

Evolution of PM rameezkhalid@iba.edu.pk 8
 The Components of Survival

Efficiency and Capital

Effectiveness Projects

New Product Customer

SURVIVAL Expectations
Development

Executive Competitiveness
Understanding
Evolution of PM rameezkhalid@iba.edu.pk 9
 Speed of Maturity

Internal
Efficiencies &
Non-Project-Driven and Project-Driven
Effectiveness Hybrid Organizations Organizations

Competitiveness

Fast Speed of Maturity Slow

Evolution of PM rameezkhalid@iba.edu.pk 10
 Benefits Of Project Management
Past View
• Project management will
require more people and
add to the overhead costs.
• Profitability may decrease.
• Project management is really
“eye wash” for the
customer’s benefit.
• Project management creates
organizational instability and
increases conflicts.
Evolution of PM rameezkhalid@iba.edu.pk
Present View
• Project management will
accomplish more work in less
time and with less people.
• Profitability will increase.
• Project management will
allow us to work closer with
our customers.
• Project management makes
the organization more
efficient and effective.
11
 Benefits Of Project Management
Past View
• Project management will
create power and authority
problems.
• Project management focuses
on sub-optimization by
looking at only the project.
• Project management delivers
products to a customer.
• Cost of project management
may make us noncompetitive.
• Only large projects need
project management.
Evolution of PM rameezkhalid@iba.edu.pk
Present View
• Project management will
reduce the majority of the
power struggles.
• Project management allows
people to make good
company decisions.
• Project management delivers
solutions to a customer.
• Project management will
increase our business.
• All projects will benefit from
project management.
12
 Project Management: Costs vs. Benefits

Cost of Project Additional Profits

Management from Better
Project
Management

$ Pegged

Time
Evolution of PM rameezkhalid@iba.edu.pk 13
 Industry Classification
(By Project Management Utilization)

Present Past

Evolution of PM rameezkhalid@iba.edu.pk 15
New Processes Supporting Project Management

Evolution of PM rameezkhalid@iba.edu.pk 16
 Resistance to Change
– Necessity of PM was customer-driven rather
than internally despite the existence of allies.

– Senior Management’s preference for the

status quo.

– Even though PM has been around for more

than fifty years, there are still different views.

Evolution of PM rameezkhalid@iba.edu.pk 17
Developing Project Management Maturity

– Defense and Construction Industries are much

more advanced in how they manage projects.
– Maturity models provide the necessary
framework to:
1. Analyze and critically evaluate current practices
2. Compare those against chief competitors or general
industry standard
3. Define a systematic route for improvement

Evolution of PM rameezkhalid@iba.edu.pk 19
 Life Cycle Phases
for Project Management Maturity

Executive
Embryonic Management
Acceptance

Line
Management Growth Maturity
Acceptance

Evolution of PM rameezkhalid@iba.edu.pk 20
 Life Cycle Phases for
Project Management
Maturity

Embryonic
• Recognize need Executive
Management
• Recognize Acceptance
benefits
• Recognize
Lineapplications
Management Growth Maturity
Acceptance
• Recognize what
must be done
Evolution of PM 21
rameezkhalid@iba.edu.pk
 Life Cycle Phases for
Project Management
Maturity

Executive
Management
Acceptance
Executive
Embryonic Management
• Visible executive
Acceptance
support
• Executive
Line understanding of
Management Growthmanagement
project Maturity
Acceptance • Project sponsorship
• Willingness to change
Evolution of PM 22
rameezkhalid@iba.edu.pk way of doing business
 Life Cycle Phases for
Project Management
Maturity

Line Management
Acceptance
Executive
• Line management
Embryonic
support
Management
Acceptance
• Line management
commitment
• Line management
education
Growth Maturity
• Willingness to release
employees for project
management training
23
Evolution of PM rameezkhalid@iba.edu.pk
 Life Cycle Phases for
Project Management
Maturity

Growth
• Development ofExecutive
a
methodology
Embryonic Management
Acceptance
• Use of life cycle
phases
• Commitment to
Line planning
Management• Minimization
Growth of Maturity
Acceptance “creeping scope”
• Selection of a project
Evolution of PM
tracking system 24
rameezkhalid@iba.edu.pk
 Life Cycle Phases for
Project Management
Maturity

Maturity
• Development of a
management cost/
schedule control
system
• Integrating cost and
schedule control
Maturity
• Developing an
educational program
to enhance project
management skills
25
 Phases for PM Maturity (SOURCE: Kerzner)

For each of the following items provide a recommendation for addressing and
resolving the issue that will allow an organization to progress toward achieving
PM Maturity.
Phase Issue Recommendation
a) Embryonic Recognizing the
need
b) Executive Management Executive
Acceptance understanding of PM

c) Line Management Line Management

Acceptance Support

d) Growth Development of a
PM methodology
e) Maturity Phase Developing an
educational program
to enhance PM skills 26
Developing Project Management Maturity
Project management maturity models:
– Kerzner’s project management maturity model
– ESI International’s project framework
– SEI’s capability maturity model integration
– PMI’s OPM3: Organizational Project
Management Maturity Model
– PRINCE2 Maturity Model

Evolution of PM 27
 OPM3®
– It is comprised of 3
general elements:
Knowledge, Assessment
and Improvement
– It contains Best Practices
designed to ensure help Major Components within OPM3

an organization identify &

manage the appropriate
mix of investments that
best meets its execution
strategies
Evolution of PM rameezkhalid@iba.edu.pk 28
 OPM3®
– It helps an org. identify which
Best Practices, Capabilities &
Outcomes they currently exhibit
– OPM3 assessment evaluates the
degree of an org.’s ability to
meet their strategic objectives by
using Best Practices
– Assessment is done through
questionnaires and certified Maturity Assessment
assessors are also available
Evolution of PM rameezkhalid@iba.edu.pk 29
 OPM3®

OPM3
Cycle

Evolution of PM rameezkhalid@iba.edu.pk 30
 Spider Web Diagram
Project
Scheduling
3
Personnel Structural
Development for Support for
2
Projects Project…
1
Networking Portfolio
0
Between Projects Management

Project Coaching,
Stakeholder Auditing and
Management Evaluating…
Control Practices

Evolution of PM rameezkhalid@iba.edu.pk 31
Project Management Maturity
Generic Model

High
Maturity
Institutionalized,
seeks continuous
improvement

Moderate Maturity
Defined practices, training programs,
organizational support

Low Maturity
Ad hoc process, no common language, little
support 32
 Informal Project Management
– Informal PM is based upon guidelines rather
than the policies and procedures that are the
basis for formal PM.
– Effective communications, cooperation,
teamwork and trust are absolutely essential for
informal PM.
– As companies become mature in PM, emphasis
is on guidelines and checklists (informal PM)
– Customers have a strong voice in whether
formal or informal PM will be used.
Evolution of PM rameezkhalid@iba.edu.pk 33
 Product Life Cycle
General phases of Product Life-Cycle
• Research and development
• Market introduction
• Growth
• Maturity
• Deterioration
• Death

Evolution of PM rameezkhalid@iba.edu.pk 35
 Project Life Cycle
• Today, there is no agreement among industries, or
even companies within same industry, about life-
cycle phases of a project. This is understandable
because of the complexity and diversity of projects.
• The life-cycle phases of a project include:
— Formation
— Buildup
— Production
— Phase-out
— Final Audit

Evolution of PM rameezkhalid@iba.edu.pk 36
 Project Vs. Product Life Cycle

FORMATION

BUILDUP

PRODUCTION

PHASE-OUT

FINAL AUDIT

Evolution of PM rameezkhalid@iba.edu.pk 37
 Project Vs. Product Life Cycle

Evolution of PM rameezkhalid@iba.edu.pk 38
 Project Life Cycles

Evolution of PM rameezkhalid@iba.edu.pk
39
Life-Cycle Phases for Computer Programming

FORMATION BUILDUP PRODUCTION PHASE-OUT FINAL AUDIT

PHASE PHASE PHASE PHASE PHASE
RESOURCES/EFFORT

Resources
Utilized

TIME
40
 Effects of Project Life Cycles
Client Interest

Project Stake

Resources

Creativity

Uncertainty

Formation Buildup Production Phase-out

& Final Audit
Evolution of PM rameezkhalid@iba.edu.pk 41
 Resistance to Project Management (SOURCE: Kerzner)

Project Managers should be prepared to manage resistance to the application of

project management methodology. Explain why each of the following business
units within an organization may resist the introduction of a project management
methodology. Consider how you may respond to resistance in each case.
Business Unit/Entity Reasons for resistance Responses or actions
that will minimize
resistance
a) Sales
b) Marketing
c) Finance and
Accounting
d) Procurement
e) Human Resources
f) Manufacturing
g) Engineering 42
 REFERENCES
•Project Management: A systems Approach
to Planning, Scheduling and Controlling
Harold Kerzner

•Project Management: Achieving

Competitive Advantage
Jeffrey K. Pinto

•Project Management: A Case Study

Harold Kerzner

Evolution of PM rameezkhalid@iba.edu.pk 44