Introduction to Project Management

What is a Project?
 A project is a temporary endeavor undertaken to
produce a unique product or service

 A project is a combination of interrelated activities

with well-defined objectives to be completed in a
specific period.

 A project is something special which is different

from routine and regular activities
What is a Project ?

 Projects are a group of activities that have to be

performed with limited resources to yield specific
objectives, in a specific time, and in a specific locality.
Thus, a project is a temporary endeavor employed to
create a unique product, service or results.

 It is a unique process, consisting of a set of coordinated

and controlled activities with start and finish dates,
undertaken to achieve an objective conforming to
specific requirements, including the constraints of time,
cost and resources.
EXAMPLES OF PROJECT
• Construction of a house.
• Writing a book.
• Building a dam.
• Introducing a new product in the market.
• Construction of a new bridge over a
river.
• A Politician contesting an election.
• Organizing a seminar.
Project Success

Customer Requirements Completed within allocated

satisfied/exceeded time frame

Completed within allocated Accepted by the customer

budget
Project Failure

Scope Creep Poor Requirements Gathering

Unrealistic planning and Lack of resources

scheduling
Project Characteristics

 Project can have several starting points but one end.

 Complexity
 Investment Decision
 Focus- Fixed set of objectives/ mission/goal
 Time Bound through schedules
 Unique
 Unity in diversity
Project Vs. Program Management
 The coordinated management of a portfolio of
projects to achieve a set of business objectives is
called program management

 A program might refer to an ongoing set of

activities internal to the organization, for example,
a Total Quality Management program, workplace
safety program, supplier development program, etc
Program Management

 Project managers would manage each of the

projects within the program and report to the
Program Manager.

 The Program Manager would ensure that all of the

integrated projects worked together on schedule, on
budget, and ultimately towards the completion of
the program.
What is Project Management
Project Management is the application of skills,
knowledge, tools and techniques to meet the needs
and expectations of stakeholders for a project.
 The purpose of project management is prediction
and prevention, NOT recognition and reaction
Project Management

 It is the application of knowledge , skills, tools and techniques

to project objectives to meet stake holders needs and
expectations.
 It is planning , monitoring and controlling all aspects of a
project and motivation of all involved to achieve project
objectives of safety and within a defined time, cost &
performance.
 Project Management is both people and technical-oriented. It
involve understanding the cause-effect relationship and
interactions among socio-technical dimensions of projects.
 How does project management benefit
you?

 To have goal clarity and measurement

 resources will be coordinated
 risks will be identified and managed
 increase the possibilities of time savings
 increase the possibilities of cost savings
 increase the possibilities of achieving the agreed outcome
 increase the possibility to deliver projects successfully
Project techniques and Improved quality..

 Decision-making routes and processes are clearly

defined
 Deadlines, costs and resources are controlled
systematically
 All processes in the project management activity chain are
coordinated to ensure they remain in harmony with one another
 The result will help you to get:
 more speed
 greater flexibility

 improved quality
NEED FOR PROJECT MANAGEMENT

 To manage large investment opportunities in

different emerging sectors.
 Projects of increasingly complex sizes
 Aggressive competition
 Turbulent business environment
 Greater focus on operational effectiveness and
efficiency.
 Downsizing
NEED FOR PROJECT MANAGEMENT

 The amount of time from introduction to

obsolescence has decreased dramatically in the last
5 years, especially for high-tech products.
NEED FOR PROJECT MANAGEMENT
Project Functions

PMI has identified six basic functions :

1. Manage the project’s scope to define the goals and the
work to be done in sufficient detail to facilitate
understanding and correct performance by participants.
2. Manage the Human Resources Effectively
3. Manage communications for the smooth running of the
project.
4. Managing time by planning and meeting schedules
5. Manage Quality so that project results are satisfactory
6. Manage Costs to see that project is performed at the
minimum possible cost and within the budget.
Common Pitfalls in Project Management

• Not being aligned to organisational strategy

• Lack of top management or sponsor support
• Political discord or disagreement
• Poor or inadequate estimating
• Working backwards from a given date
• Inexperienced project management personnel
• Fragmented team and team values
Common Pitfalls in Project Management

• Poorly/vaguely defined requirements (Scope)

• Lack of user (customer) involvement
• Unrealistic requirements or expectations
• Scope creep
• Poor communication or lack of communication
• Ignoring project warning signs
• Poor governance
Triple Constraints of Project Management

 All projects are bound by the Triple

Constraints of Project Management:
time, cost, and scope. Quality is
affected by the balance of these
three components.
 The Triple Constraints is also known
as the Iron Triangle, as shown in the
illustration below. If any one angle of
the triangle changes, then the other
two should change as well—if not,
then quality will suffer
Project Management Framework

Scope
Time Management Cost Management
Management

Quality Integration
Management HR Management
Management

Communication Procurement
Risk Management
Management Management

The PMBOK’s 9 Knowledge areas

Project Management Framework
Nine knowledge areas in PM
 Project management is comprised of the following
nine knowledge areas.
 Project Integration Management
 Project Scope Management

 Project Time Management

 Project Cost Management

 Project Quality Management

 Project Human Resource Management

 Project Communications Management

 Project Risk Management

 Project Procurement Management

Project Integration Management
 It is a subset of project management that includes the
processes required ensuring that the various elements of the
project are properly coordinated. It consists of project plan
development, project plan execution, and overall change
control.
 This knowledge area focuses on creating the project charter,
the project scope statement, and a viable project plan.
 Once the project is in motion, then Project Integration
Management is all about monitoring and controlling the
work.
 If changes happen, and we know they will, then you have to
determine how that change may affect all of the other
knowledge areas.
Project Scope Management

 This knowledge area deals with the planning,

creation, protection, and fulfillment of the project
scope.
 One of the most important activities in all of project
management happens in this knowledge area: viz.
creation of the Work Breakdown Structure.
Project Time Management

 Time management is crucial to project success.

 This knowledge area covers activities, their
characteristics, and how they fit into the project
schedule.
 This is where you and the project team will define
the activities, plot out their sequence, and calculate
how long the project duration will actually take.
Project Cost Management

 Cost is always a constraint in project management.

This knowledge area is concerned with the planning,
estimating, budgeting, and control of costs.

 Cost management is tied to time and quality

management—screw either of these up and the
project costs will increase.
Project Quality Management
 A subset of project management that includes the
processes required ensuring that the project will
satisfy the needs for which it was undertaken.

 It consists of quality planning, quality assurance,

and quality control.
Project Human Resource Management

 This knowledge area focuses on organizational

planning, staff acquisition, and team development.

 The project manager has to somehow acquire the

project team, develop this team, and then lead
them to the project results
Project Communications Management

 This knowledge area details how communication

happens, outlines stakeholder management, and
shows how to plan for communications within any
project

 90 percent of a project manager’s time is spent

communicating.
Project Risk Management
 Every project has risks. This knowledge area focuses on
risk planning, analysis, monitoring, and control.

 The project manager has to complete qualitative

analysis and then quantitative analysis in order to
adequately prepare for project risks.

 Once the project moves forward, project manager

needs to monitor and react to identified risks as
planned.
Project Procurement Management

 This knowledge area covers all the business of

project procurement, the processes to acquire and
select vendors, and contract negotiation.
 The contract between the vendor and the project
manager’s organization will guide all interaction
between the project manager and the vendor.
Types of Projects
 Strategic Projects involve creating something new and
innovative. A new product, a new service, a new retail
location, a new branch or division, or even a new
factory might be a strategic project.

 Operational Projects improve current operations. These

projects may not produce radical improvements, but
they will reduce costs, get work done more efficiently,
or produce a higher-quality product.

 Compliance Projects must be done to comply with an

industry or governmental regulation or standard.
 Project Life Cycle

Initiation Definition Planning Implemen Deployment Closing

Phase Phase Phase tation Phase Phase
Phase
Initiation Phase
 Define the need
 identifying the problem or opportunity
 articulate the specific business needs and desired
outcomes
 ensure the project is aligned with overall
organizational goals.
 Return on Investment Analysis
 assessesthe project's financial viability by estimating
the potential costs, benefits, and risks.
 generate a positive return and justify the investment of
resources.
Initiation Phase
 Make or Buy Decisions
 develop the project's components internally or
outsource them to external vendors.
 Consider factors like cost, expertise, time constraints,
and potential risks associated with each option.
 Budget Development
 to create a realistic and detailed budget that outlines
the estimated costs associated with all project activities
and resources.
 ensures financial feasibility
Definition Phase
 Determine goals, scope and project constraints
 define what the project aims to achieve (goals),
 what it encompasses (scope),
 limitations or restrictions it faces (constraints)
 includes factors like budget, timeline, resources, and
technical feasibility.
 Identify members and their roles
 Define communication channels, methods, frequency
and content
 Risk management planning
Goals must be SMART and CLEAR
Planning Phase
 Resource Planning
 Internal: 3M, External: ventors
 availability and cost of each resource.
 Develop a plan for acquiring, allocating, and managing
resources
 Work Breakdown Structure
 Break down the project into smaller, manageable tasks and
subtasks.
 Organize tasks hierarchically, creating a map of project activities.
 Estimate the time, effort, and resources required for each task.
 The WBS provides a clear visual representation of the project
scope and complexity.

Planning Phase
 Project Schedule Development
 create a timeline for completing the project.
 Identify dependencies between tasks
 Choose appropriate scheduling tools and techniques
 Develop a realistic and achievable schedule

 Quality Assurance Plan

 Define quality standards and expectations
 Identify potential quality risks and mitigation strategies.
 Establish procedures for monitoring and assessing project
quality
 Define roles and responsibilities for quality control and
corrective actions.
Work Breakdown Structure

 For defining and

organizing the total scope
of a project
 First two levels - define a
set of planned outcomes
that collectively and
exclusively represent
100% of the project scope.
 Subsequent levels -
represent 100% of the
scope of their parent node
Implementation Phase
 Execute project plan and accomplish project goals
 Training Plan
 System Build
 Quality Assurance
Deployment Phase
 User Training
 Production Review
 Start Using
Closing Phase
 Contractual Closeout
 Finalizing paperwork
 Documenting approvals
 Resolving outstanding issues:

 Post Production Transition

 Knowledge transfer
 Training
 Change management

 Lessons Learned
 Feedback
 Identify key learnings
 Document and share learnings
 What is a Feasibility Study
 A feasibility study is a comprehensive evaluation of a proposed project
that evaluates all factors critical to its success to assess its likelihood of
success.

 A feasibility study is a preliminary assessment of a proposed project to

determine its practicality, viability, and potential for success.

 It evaluates a project's or system's practicality.

 to determine its strengths and weaknesses, potential opportunities and

threats, resources required to carry out, and ultimate success prospects.

 Two criteria should be considered when judging feasibility: the required

cost and expected value
Benefits to conducting a feasibility
study
 to provide an independent assessment that examines all
aspects of a proposed project, including technical,
economic, financial, legal, and environmental
considerations

 to identify potential risks and challenges that could

impact the project's success

 provide decision-makers with the information they need

to make informed decisions about whether or not to
proceed with the project.

 to improve the project's chances of success.

Types of Feasibility Study
 1. Technical Feasibility
 2. Economic Feasibility
 3. Legal Feasibility
 4. Operational Feasibility
 5. Scheduling Feasibility
Feasibility analysis helps identify any constraints the
proposed project may face, including:

 Internal Project Constraints: Technical, Technology,

Budget, Resource, etc.

 Internal Corporate Constraints: Financial, Marketing,

Export, etc.

 External Constraints: Logistics, Environment, Laws, and

Regulations, etc.
Benefits of conducting a feasibility
study
 Improves project teams’ focus
 Identifies new opportunities
 Provides valuable information for a “go/no-go”
decision
 Narrows the business alternatives
 Identifies a valid reason to undertake the project
 Enhances the success rate by evaluating multiple
parameters
 Aids decision-making on the project
 Identifies reasons not to proceed
Steps of Feasibility Study
 1. Conduct a Preliminary Analysis
 2. Prepare a Projected Income Statement
 3. Conduct a Market Survey, or Perform Market
Research
 4. Plan Business Organization and Operations
 5. Prepare an Opening Day Balance Sheet
 6. Review and Analyze All Data
 7. Make a Go/No-Go Decision
1. Conduct a Preliminary Analysis
 A preliminary investigation is necessary to determine
whether a full feasibility study is warranted.

 Information will be gathered to assess the project's

potential and make a preliminary decision about its
feasibility.

 This should include a review of relevant documents,

interviews with key personnel, and surveys of potential
customers or users.
2. Prepare a Projected Income Statement

 Projected income statement -how much money your

business is expected to make in the coming year.

 Estimated revenue and estimated expenses.

 This document will be essential in helping you make

informed decisions about your business.
 3. Conduct a Market Survey, or
Perform Market Research
 Conducting market research is an important step in
any feasibility study.
 Decide by understanding the needs and wants of
your potential customers.
 Competition and your target market.
 Ways to conduct market research- conduct a
survey- directly or use data from secondary
 This will help you understand your target market
and how to reach them.
4. Plan Business Organization and
Operations
 There are many factors to consider when planning
your organization and operations, such as:
 • Company Structure
 • Location
 • Marketing
5. Prepare an Opening Day Balance
Sheet
 A snapshot of the company's financial position at the
beginning of the business venture.
 to give an idea of the amount of money that the company
has to work with
 to track its expenses and income as they occur.
 This information is vital to making sound business decisions.
 The opening day balance sheet will include the following:
 • Cash on hand, Accounts receivable
 • Inventory, Prepaid expenses
 • Fixed assets, Accounts payable
 • Notes payable, Long-term liabilities
 • Share
6. Review and Analyze All Data
 The data collected should be verified against source documentation,
and any discrepancies should be noted.
 The purpose of the feasibility study is to provide a basis for making
a decision, and the data should be sufficient to support that decision.
 The analysis should consider both the positive and negative aspects
of the proposed project.
 The financial analysis should be thorough, and all assumptions should
be documented.
 The risk assessment should identify any potential risks and mitigation
strategies.
 The team assigned to the project should review the feasibility study
and recommend the organization’s leadership.
 If the project is approved, the organisation should develop a project
plan that includes a detailed budget and timeline
7. Make a Go/No-Go Decision

 The go/no-go decision is a key part of a feasibility

study, and it can help you determine whether or not
your business idea is worth pursuing.
 Making the go/no-go decision is all about risk
assessment.
 You need to weigh the risks and rewards of starting
your business and decide whether the potential
rewards are worth the risks.
 If the risks are too high, you may want to reconsider
your business idea.
Some reasons to do a feasibility study

 You are considering a major change or investment

 You want to assess the viability of a new business or product
 You need to understand the risks and potential rewards associated
with a project

 Some reasons not to do a feasibility study

 You are pressed for time and don't think the study will provide
enough value to justify the time commitment.
 You are confident that your idea is feasible, and a study will only
confirm what you already believe.
 The change or investment is not significant enough to warrant the
study.
Project Selection
 Project selection is an integral part of a company's
process for choosing a project with the highest
priority to accomplish.

 Selecting the right project could create a better

return on investment for a company, increase
efficiencies, shorten time-to-market and lead to
successful project delivery.
Project Selection
 Project selection is the evaluation of project ideas to
help decide which project has the highest priority.

 Typically, when project managers select a project, they

may consider the following factors:

 Costs
 Resources
 Benefits or ROI
 Time to complete the project
 Risks associated with the project
Why is project selection important?

 Invest in those that are safe and will yield benefits

and good returns.

 Analyse new opportunities and help justify the

decisions for making needed monetary investments.

 Companies may have several project opportunities

to invest in, but because they can't invest in all
projects, they are often selective.
Steps in Project Selection
 1. Make sure the project fits the company's strategy
 2. Understand your company environment
 3. Consider and analyze historical data
 4. Decide who will be the project champion
Project selection methods

 Cost-benefit analysis
 Payback period
 Discounted cash flow
 Opportunity costs
 Ranking method
 Scoring model
Cost-Benefit Analysis (CBA)

• Cost-Benefit Analysis (CBA)This method compares the

total expected costs and benefits of a project.
• Example:
• Project A: Expected benefit = Rs 16,00,000, Expected cost
= Rs 9,60,000
• Project B: Expected benefit = Rs 20,00,000, Expected cost
= Rs 14,40,000
• CBA Ratio:
• Project A: 16,00,000/ 9,60,000=1.67
• Project B: 20,00,000/14,40,000=1.39
• Since Project A has a higher ratio, it is preferable.
Payback Period
• Payback Period: The time required to recover the
initial investment.
• Example:
• Project X: Initial cost = Rs 8,00,000, Annual cash
inflow = Rs 2,00,000
• Payback period = 8,00,000,2,00,000=4 years
• The shorter the payback period, the better the project.
Discounted Cash Flow (DCF)

• DCF is a method used to evaluate the value of a

project or investment by considering the time value
of money.
• It helps determine whether the future cash flows of
a project are worth more than the initial investment
when discounted to their present value.
• Future cash inflows are discounted using a discount
rate (typically the cost of capital or interest rate).
Discounted Cash Flow (DCF)

• DCF is a method used to evaluate the value of a

project or investment by considering the time value
of money.
• It helps determine whether the future cash flows of
a project are worth more than the initial investment
when discounted to their present value.
• Future cash inflows are discounted using a discount
rate (typically the cost of capital or interest rate).
Opportunity Cost
The benefit foregone by choosing one project over
another.

Example:
If Project A generates a return of Rs 16,00,000 and Project
B generates Rs 20,00,000, the opportunity cost of choosing
A is Rs 4,00,000.
Ranking Method
• Projects are ranked based on predefined criteria.
• Example:
• Suppose three projects have different priority scores
based on financial return, risk, and strategic fit.
• Project 1: Score = 85
• Project 2: Score = 78
• Project 3: Score = 90
• Project 3 is ranked highest and would be selected.
Scoring Model
• Assigns weights to multiple criteria and calculates a
weighted score.
•
• Suppose a company uses a scoring model with weights:
• Financial return (40%)
• Risk (30%)
• Strategic alignment (30%)
• Project scores:
• Project A: (90 × 0.4) + (70 × 0.3) + (80 × 0.3) = 81
• Project B: (80 × 0.4) + (85 × 0.3) + (75 × 0.3) = 80.5
• Since Project A has a slightly higher score, it would be
preferred.