MBA General - Project Management

LECTURE 2
Project Life Cycle

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 Introduction
• The project life-cycle and the work breakdown structure have
come to the forefront in recent years as key frameworks or
structures for sub-dividing the project's scope of work into
manageable phases or work packages. Where the WBS is a
hierarchical sub-division of the scope of work, the project life-
cycle sub-divides the scope of work into sequential project
phases.
• According to literature, because projects are unique and
involve a certain degree of risk, companies performing
projects will generally subdivide their projects into several
project phases to provide better management control.
Collectively these project phases are called the project
lifecycle.

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 Project Life Cycle (PLC)
• The Project Life Cycle (PLC) refers to a logical
sequence of activities to accomplish the project’s goals
or objectives.
• Regardless of scope or complexity, any project goes
through a series of stages during its life.
• There is first an Initiation or Birth phase, in which the
outputs and critical success factors are defined, followed
by a Planning phase, characterised by breaking down the
project into smaller parts/tasks, an Execution phase, in
which the project plan is executed, and lastly a Closure
or Exit phase, that marks the completion of the project.
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• Project activities must be grouped into phases. Why?
Because by doing so, the project manager and the core
team can efficiently plan and organise resources for each
activity, and also objectively measure achievement of
goals and justify their decisions to move ahead, correct,
or terminate.
• It is of great importance to organise project phases into
industry-specific project cycles. Why?
Not only because each industry sector involves specific
requirements, tasks, and procedures when it comes to
projects, but also because different industry sectors have
different needs for life cycle management methodology.
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 Projects Cannot Be Run In Isolation

• Projects must operate in a broad organizational

environment.
• Project managers need to take a holistic or systems
view of a project and understand how it is situated
within the larger organisation

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 Project Phases and the Project Life Cycle
• A project life cycle is a collection of project phases
• Project phases vary by project or industry, but some general
phases include: Concept (Initiation), Development (Planning),
Implementation (Execution) and Support (Closure)
• Products also have life cycles
• The System Development Life Cycle (SDLC) : is a framework
for describing the phases involved in developing and maintaining
information systems.
• Typical SDLC phases include planning, analysis, design,
implementation, and support
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 The Product Life Cycle
A product life cycle can be divided into five phases.
• Development
• Introduction
• Growth
• Maturity
• Decline

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The ‘classical’ life cycle of a product has five phases or stages.

Development.
The product has a research or design and development stage. Costs are
incurred but the product is not yet on the market and there are no sales
revenues.

Introduction.
The product is introduced to the market. Potential customers are initially
unaware of the product or service, and the organisation may have to spend
heavily on advertising to bring the product or service to the attention of the
market. In addition, capital expenditure costs may be incurred in order to
increase the production capacity as sales demand grows.

Growth.
The product gains a bigger market as demand builds up. Sales revenues
increase and the product begins to make a profit.
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Maturity.
Eventually, the growth in demand for the product will slow down
and it will enter a period of relative maturity, when sales have
reached a peak and are fairly stable. This should be the most
profitable phase of the product’s life. The product may be modified
or improved, as a means of sustaining its demand and making this
phase of the life cycle as long as possible.

Decline.
At some stage, the market will have bought enough of the product
and it will therefore reach ‘saturation point’. Demand will start to
fall. Eventually it will become a loss maker and this is the time
when the organisation should decide to stop selling the product or
service.

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• The level of sales and profits earned over a life cycle can
be illustrated diagrammatically as follows.

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A more detailed description of the Life Cycle

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Phases of the Project Life Cycle

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The Project Management Process
 Project Management Process Groups
 A process is a series of actions directed toward a
particular result.
 Project management can be viewed as a number of
interlinked processes.
 The project management process groups include:
 Initiating processes
 Planning processes
 Executing processes
 Monitoring and controlling processes
 Closing processes

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Level of Activity and Overlap of Process
Groups Over Time

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• A project life cycle is the series of phases that a project
passes through from its initiation to its closure. The
phases are generally sequential, and their names and
numbers are determined by the management and control
needs of the organization or organizations involved in
the project, the nature of the project itself, and its area of
application.

• The phases can be broken down by functional or partial

objectives, intermediate results or deliverables, specific
milestones within the overall scope of work, or financial
availability. Phases are generally time bounded, with a
start and ending or control point.
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 Characteristics of the Project Life Cycle
• Projects vary in size and complexity.
• All projects can be mapped to the following generic life
cycle structure
 Starting the project,
 Organizing and preparing,
 Carrying out the project work, and
 Closing the project.

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• The generic life cycle structure generally displays the
following characteristics:

 Cost and staffing levels are low at the start, peak as the
work is carried out, and drop rapidly as the project
draws to a close.

 The typical cost and staffing curve above may not

apply to all projects. A project may require significant
expenditures to secure needed resources early in its life
cycle, for instance, or be fully staffed from a point very
early in its life cycle.

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 Initiation Phase
• In this first stage, the scope of the project is
defined along with the approach to be taken to
deliver the desired outputs.
• The project manager is appointed and in turn, he
selects the team members based on their skills
and experience.
• Initiation involves starting up the project, by
documenting a business case, feasibility study,
terms of reference, appointing the team and
setting up a Project Office.
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 Initiation Phase
• Overall, there are six key steps that you need to
take to properly initiate a new project.
• The Project Initiation Phase is the most crucial
phase in the Project Life Cycle, as it's the phase
in which you define your scope and hire your
team.
• Only with a clearly defined scope and a suitably
skilled team, can you ensure success.

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The Project Initiation phase involves the
following six key steps

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 Initiation Phase (contd…)
 Business Case
• It will help you identify the detailed benefits and costs of
your solution and will help you to gain approval of the
business case and secure the funding you need, to get
started.
 Feasibility Study
• It takes you through the process of completing a
Business Feasibility Study by defining the business
problem / opportunity, the alternative solutions available
and the recommended solution for implementation.
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 Terms of Reference
• Its sets out the project vision, objectives, scope and
implementation, thereby giving the team clear
boundaries within which the project must be delivered.
 Project Team
• It also defines how those targets are going to be
measured and how the performance of the role will be
assessed.
 Project Office
• Identify the right location for your PMO team, Ensure
that you have the correct infrastructure, Procure the right
PMO equipment and tools, Define the PMO roles and
responsibilities.
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 Phase Review
• This Phase Review Form is completed at the end of the
Project Initiation phase to tell the sponsor whether the
project has achieved its objectives to date and to
measure the deliverables produced by the project.
• Phase reviews are conducted at the end of the Initiation,
Planning and Execution phases within a project.
• This Phase Review Form helps you document the results
of your Project Review, by stating whether the: project
is currently delivering to schedule, budget allocated was
sufficient at this point, risks have been controlled and
mitigated, changes were properly managed and if the
project is on track.
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Project Initiation
 Initiating a project includes recognizing and starting a
new project or project phase.
 Some organizations use a pre-initiation phase, while
others include items such as developing a business case
as part of the initiation.
 The main goal is to formally select and start off projects.
 Key outputs include:
 Assigning the project manager.

 Identifying key stakeholders.

 Completing a business case.

 Completing a project charter and getting signatures on

it.

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Project Initiation Documents

 Every organization has its own variations of what

documents are required to initiate a project. It’s
important to identify the project need, stakeholders,
and main goals.

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Summary - Initiation
 Phase 1 Conception
 – Determine that a project is needed
 – Establish objectives
 – Estimate the resources that the organization is
willing to
 commit
 – Sell the organization on the need for a project
organization
 – Make key personnel

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Project Planning
 The main purpose of project planning is to guide
execution.

 Every knowledge area includes planning information

 Key outputs included:

 A team contract.
 A scope statement.
 A work breakdown structure (WBS).
 A project schedule, in the form of a Gantt chart with all
dependencies and resources entered.
 A list of prioritized risks (part of a risk register).

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 Planning Phase
• The second phase should include a detailed
identification and assignment of each task until
the end of the project.
• It should also include a risk analysis and a
definition of a criteria for the successful
completion of each deliverable.
• Planning involves setting out the roadmap for the
project by creating the following plans: project
plan, resource plan, financial plan, quality plan,
acceptance plan and communications plan.
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 Planning (contd…)
• The plans created during this phase will help you
to manage time, cost, quality, change, risk and
issues.

• They will also help to manage staff and external

suppliers, to ensure that you deliver the project
on time and within schedule.

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Summary - Definition / Planning

•Define the project organization approach

•Define the project targets
•Prepare schedule for the execution phase
•Define and allocate tasks and resources
•Build the project team

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Project Executing
 Project execution usually takes the most time and
resources.

 Project managers must use their leadership skills to

handle the many challenges that occur during project
execution.

 Many project sponsors and customers focus on

deliverables related to providing the products, services,
or results desired from the project.

 A milestone report can keep the focus on completing

major milestones.

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 Execution & Controlling
• The most important issue in this phase is to ensure
project activities are properly executed and controlled.
• During the execution phase, the planned solution is
implemented to solve the problem specified in the
project's requirements.
• As the execution phase progresses, groups across the
organisation become more deeply involved in planning
for the final testing, production, and support.
• Execution involves building the deliverables and
controlling the project delivery, scope, costs, quality,
risks and issues.
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Project Monitoring and Controlling
 Involves measuring progress toward project
objectives, monitoring deviation from the plan,
and taking corrective action to match progress
with the plan.

 Affects all other process groups and occurs

during all phases of the project life cycle.

 Outputs include performance reports,

requested changes, and updates to various
plans.
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 Summary - Execution & Controlling

• Perform the work of the project (i.e., design,

construction, production, site activation, testing,
delivery, etc)

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 Closure
• In this last stage, the project manager must ensure that the
project is brought to its proper completion.
• The closure phase is characterised by a written formal
project review report containing the following
components: a formal acceptance of the final product by
the client, Weighted Critical Measurements (matching the
initial requirements specified by the client with the final
delivered product), rewarding the team, a list of lessons
learned, releasing project resources, and a formal project
closure notification to higher management.
• Closure involves winding-down the project by releasing
staff, handing over deliverables to the customer and
completing a post implementation review.
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Project Closing
 Involves gaining stakeholder and customer acceptance
of the final products and services.

 Even if projects are not completed, they should be

formally closed in order to reflect on what can be
learned to improve future projects.

 Outputs include project archives and lessons learned,

which are part of organizational process assets.

 Most projects also include a final report and

presentation to the sponsor or senior management.
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