University of Economics in Katowice

EuroClasses:
Project Management

Lecture 1:
An Introduction to Project
Management
Today’s Objectives

 Introductions
 Review Course Syllabus
 What is a project, and what a project is not
 Project triangle
 When a project is successful?
 Project life cycle
 Project management methodologies

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Introductions

 prof. Maciej Nowak

 Faculty of Informatics and Communication
 Department of Operations Research
 Phone: 32-2577973
 E-mail: maciej.nowak@ue.katowice.pl
 Room: 110B
 Contact hours: Thursday, 15:00 – 16:30

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Introductions cont.

 Scientific interests:
 Operations Management & Project Management
 Quantitative methods for decision making
 Decision making under risk
 Multiple criteria problems
 Interactive techniques
 Simulation techniques and their applications in decision making

Project Management University of Economics in Katowice 1-4

Introductions cont.

And now it’s time for you to introduce yourselves!

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General Course Objectives

 to supply students with basic knowledge of project management,

 to present techniques and tools used in various phases of a project
life cycle,
 to make possible to get competencies in using presented
techniques in real-life projects,
 to enable students to possess decision-making skills in project
planning processes,
 to enable students to possess skills in team working, including
group decision making.

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Course outline
 Introduction to project
management
 Organization strategy and
project selection
 Defining the project
 Estimating project times and
costs
 Developing a project plan
Project Management University of Economics in Katowice
 Managing risk
 Scheduling resources and
costs
 Reducing project duration
 Managing project teams
 Progress and performance
measurement and evaluation
 Project audit and closure
1-7
Learning approaches, grading system

 Overview of learning approaches

 Learn by reading, listening, discussing, but also, mostly, By Doing
(solving problems) !!!

 Marks
 Final exam – 40%
 Homework (cases) – 20%
 Project (teamwork) – 40%

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Recommended reading

 Gray C.F., Larson E.W., Project Management: the Managerial

Process, 4th edition, McGraw-Hill, 2008.
 Nicholas J.M., Steyn H., Project Management for Business,
Engineering, and Technology, 3rd edition, Elsevier, 2008.
 Wysocki R.K., McGary R., Project Management: Traditional,
Adaptive, Extreme, 4th edition, Wiley, 2006.

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Supplementary reading

 Goodpasture J.C., Quantitative Methods in Project Management,

J. Ross Publishing, 2004.
 Kendrick T., Identifying and Managing Project Risk, Amacom American
Management Association, 2003.
 Kerzner H., Project Management - Best Practices: Achieving Global
Excellence, 2nd Edition, Wiley, 2010.
 A Guide to the Project Management Body of Knowledge
(PMBOK® Guide), 5th Edition, Project Management Institute, 2012.
 Levine H.A., Project Portfolio Management, Wiley, 2005.

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Course website

 Moodle Platform
 http://badop.ae.katowice.pl
 Course: EuroClasses – Project Management
 You have to register to use the resources.
 Enrolment key: ProMan_2016
 Contents:
 PowerPoint presentations
 Cases and exercises

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The definition of project (1)

J.R. Turner:
 A project is a set of actions for which human, material
and financial resources are organized in a new manner to
undertake a unique set of activities, well specified, inside
constraints of costs and delay, in order to achieve a
beneficial change defined by objectives of quantitative and
qualitative order.

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The definition of project (2)

R.P. Declerck:
 A project is a set of actions limited in time and space,
inserted in and in interaction with a politico-socio-economic
environment, oriented toward a progressively redefined
goal by dialectics between the thought (the plan) and the
reality.

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The definition of project (3)

C.F. Gray & E.W. Larson:

 A project is a complex, nonroutine, one-time effort limited
by time, budget, resources, and performance specifications
designed to meet customer needs.

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The definition of project (4)

PRINCE2:
 A project is a temporary organization that is created for the
purpose of delivering one or more business products
according to an agreed Business Case.

PMBoK:
 A project is a temporary endeavor undertaken to create a
unique product, service, or result

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The major characteristics of a project

 An established objective
 A defined life span with a beginning and an end
 Usually, the involvements of several departments and professionals
 Typically, doing something that has never been done before
 Specific time, cost, and performance requirements

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 What is a project, and what a project is
not?

Routine, Repetitive Work: Project:

 Taking class notes  Writing a term paper
 Daily entering sales receipts into the  Setting up a sales kiosk for a professional
accounting ledger accounting meeting
 Responding to a supply-chain  Developing a supply-chain information
request system
 Writing a new piano piece
 Practicing scales on the piano  Designing a new model of iPhone
 Routine manufacture of an Apple  Wire-tag projects for GE and Wal-Mart
iPhone
 Attaching tags on a manufactured
product

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 Operations & Projects

Operations: Projects:
 Steady, non-stop activities  Activities aimed at a specific objective for a
specific period
 Priority of quality and technical excellence  Variable priorities according to quality-cost-
time constraints
 Repetitive, standardized and programmable  Non-repetitive, unique and often innovative
activities activities
 Marginal creativity and low degree of  Large degree of creativity and freedom at the
freedom for the actors involved beginning of the project
 The future effects can be approximated  The future effects are difficult to foresee
[experience] (+ risks)
 The manager carries formal power and  The manager often has little formal
authority power
 Operation budget
 Investment budget

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Examples of projects

 Developing a new product or service

 Effecting a change in structure, stuffing, or style of organization
 Designing a new transportation vehicle
 Developing or acquiring a new or modified information system
 Constructing a building or facility
 Building a water system for a community
 Running a campaign for political office
 Implementing a new business procedure or process
 Responding to contract solicitation

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Types of projects

 Compliance and emergency (must do):

 Compliance: needed to meet regulatory conditions to operate
 Emergency: eg. rebuilding a factory destroyed by fire
 Usually have penalties if they are not implemented

 Operational: needed to support current operations; designed to

improve efficiency of delivering systems, reduce product costs,
improve performance – example: TQM projects
 Strategic: those that directly support the organization’s long-run
mission; frequently are directly toward increasing revenue or
market share – examples: new products, research and
development

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Uncertainty: Complexity of projects
- The Goals & Methods Matrix
Projects type 2 Projects type 4
Product Development R&D ilure
f fa

Payne, Turner, Company-wide project management: the

o
risks

planning and control of programmes of projects of

r
ate
e
No

Gr
Well defined methods

different type, International Journal of Project

Management, Vol. 17, No. !, pp. 55-59, 1999
Projects type 1 Projects type 3
Engineering Systems Development
Yes

cess
f suc
ceso
an
ter
ch Well defined goals
rea
G Yes No
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Projects and Change

 Projects generate Change – by definition!

 Expect conflict (generally) – crucial to conduct a thorough
strategic analysis of the situation and the stakeholders
 Manage all groups of stakeholders to minimise risk and
negative impacts of transition

 You will need to build your case for Change

 What are the benefits/opportunities?
 What are the risks, threats, consequences of not
changing?
 What are the significant constraints to prevent a successful
implementation of the change?
 What are our strengths, what is available to us to facilitate a
successful implementation?
 What are our strategies for moving forward?
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Program

 A program is a group of related projects managed in a

coordinated way to obtain benefits and a level of control not
available from managing them individually.
 A new car model program can be broken up into projects
for the design and upgrading of each major component
(transmission, engine, interior and exterior) while the
ongoing manufacturing and operations occurs on the
assembly line.

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Program vs. Project portfolio

Nicholas, Steyn:
 Program: extends over longer time horizon and consists of
several parallel or sequential work efforts or projects that
are coordinated to meet a program goal

 Portfolio: a group of projects or programs in an

organization or business unit that aims at strategic goals,
share resources, and must compete for funding

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 Project
ProjectManagement
constraintsChallenges
How sure or confident are we of
RISK
the conditions surrounding the
project and that we can complete
the project according to plan?
SCOPE TIME
What are we delivering?
Quality How long will it take?

Shared needs
and expectations of stakeholders
To what quality standards or measurement are we
developing the deliverables and how good should it be?
COST
Who is needed to complete the project and what other resources
do we need (how much do we need of each) and how much will they
cost?
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What is a successful project

A successful project is:

 Done on time
 Uses only the resources budgeted
 Delivers the results agreed upon by stakeholders
 Meets or slightly exceeds stakeholder expectations

A successful project strikes a balance between customer satisfaction,

results, time and resources.

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Is this project successful?

 The project completed on time

 The budget not increased
 The new product designed and constructed
 A problem occurred: the result of the project is useless, as
the competitor proposed a more innovative product and the
company lost its market share

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Essential Success Factors (1)

 The project manager, project team and stakeholders

(including the client) agree on the goals of the project.
 Without clear goals and agreement among stakeholders, there is
no success.
 Everyone must agree that they want the same things to be
produced.

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Essential Success Factors (2)

 Management support, which is essential for:

 Supplying the necessary resources
 Granting the project manager the authority to execute decisions
and make policies necessary for completing a project.

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Essential Success Factors (3)

 Effective communication that is appropriately delivered on

an ongoing basis throughout the project.
 Without communication, people can’t agree on any goals, let
alone meet them.
 Everyone needs to know what is in the plan and who is expected
to implement what, and when.

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Essential Success Factors (4)

 The project manager has:

 The ability to plan.
 The ability to communicate effectively.
 The ability to gain consensus among diverse and disparate
groups of people.
 The ability to use proven formal techniques of project
management.
 The creative ability to think of new solutions.
 The ability to understand organizational and project
politics.
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Project Life Cycle

 Stages of a conventional project:

 Slow beginning (idea to project scope)
 Build-up of size (plan)
 Peak (during execution of plan)
 Beginning of a decline
 Closure

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 Project Life Cycle: Cost & time
Costs
Execution and control

Planning

Operational
planning of
project
Initiation Closure
Strategic
planning of
project

Operations

Time

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 Project Life Cycle: Changes
Cost
Go No Go Go No Go

COST OF CHANGE

Go No Go Go No Go

UNCERTAINTY

Time

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Gates Outputs

Identification, Initiation, Design Project charter

Planning Project plan

Execution Products / services

Transfer to operations, resources

Closure distribution, ex-post evaluation and
lessons learned

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Phase Completion: The Gate

The completion of each phase usually includes:

 The delivery of a product (often a report)
 A global project review in order to make sure :
 That aimed objectives are always relevant
 That nothing was forgotten and the components of the project are coherent
 That risks are identified and managed
 That the project is feasible

 A recommendation to carry on or not

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Project Lifecycle – Another representation

From: Wysocki, McGary, Effective Project Management, 3rd edition, Wiley, 2003

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Project Management

To manage a project is: to plan, to organize, to direct, and to

control resources with the aim of reaching an objective at a
precise date while respecting a budget.

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Project Management

 The application of knowledge, skills, tools, and techniques

to project activities in order to meet project requirements
and stakeholder expectations which implies invariably a
trade-off among conflicting demands:
 Scope, time, cost, quality
 Different stakeholders with different needs and expectations
 Progressive identification of changing needs of stakeholders

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Why do organizations use Project Management?

 Improve communication among project participants

 Ability to define and control project scope
 Ability to identify, monitor and track milestones
 Accurate projection of resource requirements
 Improve assessment and management of risk events
 Capability and mechanisms to measure performance
 Clarification of and alignment with organization goals

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Forces Driving Project Management

 Exponential expansion and complexity of human

knowledge
 Growing demand for a broad range of complex,
sophisticated, customized goods and services
 Evolution of worldwide competitive markets for the
production and consumption of goods and
services
Meredith

and Mentel 2006

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The Importance of Project
Management

 Compression of the Product Life Cycle

 Global Competition
 Knowledge Explosion
 Corporate Downsizing
 Increased Customer Focus
 Small Projects Represent Big Problems

Gray and Larson 2008

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Impact of Using Project Management

Companies have experienced:

 Better customer relations
 Shorter overall delivery times
 Lower costs and higher profit margins
 Higher quality and reliability (production)
 Higher worker morale

Meredith

and Mentel 2006

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That’s all for today!

See you next week!