Cpma Book
Cpma Book
Cpma Book
Professional Qualifications
CPMA
Certified
Project Management Analyst
Course Book
Contents
Chapter
Page
Feasibility studies
36
54
75
86
108
120
ii
Chapter 1
What is a project?
To understand project management it is necessary to first define what a project is.
A Project is 'an undertaking that has a beginning and an end and is carried out to meet established
goals within cost schedule and quality objectives'. (Haynes Project Management)
Intended to be done only once (although similar separate projects could be undertaken)
In general, the work organisations undertake involves either operations or projects. Operations and
projects are planned, controlled and executed. So how are projects distinguished from 'ordinary
work'?
Projects
Operations
On-going
Project management is the combination of systems techniques and people used to control and
monitor activities undertaken within the project. A project will be deemed successful if it is
completed at the specified level of quality on time and within budget.
The objective of project management is a successful project. A project will be deemed successful if
it is completed at the specified level of quality, on time and within budget.
Objective
Comment
Quality
The end result should conform to the project specification. In other words, the
result should achieve what the project was supposed to do.
Budget
Timescale
The progress of the project must follow the planned process, so that the 'result'
is ready for use at the agreed date. As time is money, proper time management
can help contain costs.
Comment
Teambuilding
The work is carried out by a team of people often from varied work and
social backgrounds. The team must 'gel' quickly and be able to
communicate effectively with each other.
Planning
Problem solving
mechanisms
Delayed benefit
There is normally no benefit from a project until the work is finished. This
means that significant expenditure is being incurred for no immediate
benefit this can be a source of pressure.
Dealing with
specialists
Projects often involve several parties with different interests. This may
lead to conflict.
Project management ensures responsibilities are clearly defined and that resources are focussed on
specific objectives. The project management process also provides a structure for communicating
within and across organisational boundaries.
All projects share similar features and follow a similar process. This has led to the development of
project management tools and techniques that can be applied to all projects, no matter how
diverse. For example, with some limitations similar processes and techniques can be applied to
whether building a major structure or implementing a company-wide computer network.
All projects require a person who is ultimately responsible for delivering the required outcome.
This person is the project manager.
The person who takes ultimate responsibility for ensuring the desired result is achieved on time and
within budget is the Project Manager.
The way in which a project manager co-ordinates a project from initiation to completion, using
project management and general management techniques, is known as the Project Management
process.
Operations manager
Duty
Comment
Outline planning
Detailed planning
Teambuilding
Communication
The project manager must let superiors know what is going on, and ensure
that members of the project team are properly briefed.
Co-ordinating project
activities
Between the project team and users, and other external parties (eg
suppliers of hardware and software).
Monitoring and
control
The project manager should estimate the causes for each departure from
the standard, and take corrective measures.
Problem-resolution
Quality control
An effective project management process helps project managers maintain control of projects and
meet their responsibilities.
Responsibilities to management
Ensure resources are used efficiently strike a balance between cost, time and results
Maintain a customer orientation (whether the project is geared towards an internal or external
customer) customer satisfaction is a key indicator of project success
Ensure the project team has the resources required to perform tasks assigned
Provide any support required when members leave the team either during the project or on
completion
Type of skill
Leadership and
team building
Organisational
Ensure all project documentation is clear and distributed to all who require it.
Use project management tools to analyse and monitor project progress
Communication
Technical
By providing (or at least providing access to) the technical expertise and
experience needed to manage the project.
Autocratic management
Participative management
(empowermaent)
PM makes
decision
and
announces
it
PM makes
decision
and 'sells'
it to team
PM
presents
tentative
decision,
invites
questions,
makes
decision
PM
presents
problems,
gets
suggestions
,
makes
decision
PM defines
problem,
shares
decisionmaking
responsibili
ty
with team
The leadership style adopted will affect the way decisions relating to the project are made.
Although an autocratic style may prove successful in some situations (eg 'simple' or 'repetitive'
projects), a more consultative style has the advantage of making team members feel more a part of
the project. This should result in greater commitment.
Not all decisions will be made in the same way. For example, decisions that do not have direct
consequences for other project personnel may be made with no (or limited) consultation. A balance
needs to be found between ensuring decisions can be made efficiently, and ensuring adequate
consultation.
The type of people that comprise the project team will influence the style adopted. For example,
professionals generally dislike being closely supervised and dictated to. (Many non-professionals
dislike this too!) Some people however prefer to follow clear, specific instructions and not have to
think for themselves.
Project management techniques encourage management by exception by identifying, from the
outset, those activities which might threaten successful completion of a project.
The Project Team comprises the people who report directly or indirectly to the project manager.
Project success depends to a large extent on the team members selected. The ideal project team
achieves project completion on time, within budget and to the required specifications with the
minimum amount of direct supervision from the project manager.
Effective communication
All members being aware of the team's purpose and the role of each team member
Innovative/creative behaviour
Results orientation
An acceptance of change
Collaboration and interaction between team members will help ensure the skills of all team
members are utilised, and should result in 'synergistic' solutions. Formal (eg meetings) and informal
channels (eg e-mail links, a bulletin board) of communication should be set up to ensure this
interaction takes place.
Team members should be responsible and accountable. The project manager should provide regular
updates on project progress and timely feedback on team and individual performance.
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Managing conflict
Wherever there is a potential for conflict a process to resolve it should be established before the
conflict occurs.
It is inevitable when people from wide-ranging backgrounds combine to form a project team that
conflict will occasionally occur. Some conflicts may actually be positive, resulting in fresh ideas and
energy being input to the project. Other conflicts can be negative and have the potential to bring
the project to a standstill.
An open exchange of views between project personnel should be encouraged as this will help
ensure all possible courses of action and their consequences are considered. The project manager
should keep in touch with the relationships of team members and act as a conciliator if necessary.
Ideally, conflict should be harnessed for productive ends. Conflict can have positive effects such as
those listed below.
Resolution techniques
Ideally the conflict will be resolved by the parties involved agreeing on a course of action. In cases
where insufficient progress towards a resolution has occurred the project manager should attempt
to bring about a resolution.
The project manager should employ the following techniques in an attempt to resolve the conflict.
(a) Work through the problem using the negotiation techniques described above.
11
Systems analysts
In general terms, the tasks of the systems analyst are as follows.
Systems analysis involves carrying out a methodical study of a current system (manual or
computerised) to establish:
(a) What the current system does.
(b) Whether it does what it is supposed to do.
(c) What the user department would like it to do, and so what the required objectives of the
system are.
Systems design having established what the proposed system objectives are, the next stage is to
design a system that will achieve these objectives.
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Systems specification in designing a new system, it is the task of the systems analyst to specify
the system in detail.
This involves identification of inputs, files, processing, output, hardware, costs, accuracy, response
time and controls.
The system design is spelled out formally in a document or manual called the systems specification
(which includes a program specification for each program in the system).
The analyst will often also have overall responsibility systems testing.
Once installed, the analyst will keep the system under review, and control system maintenance
with the co-operation of user departments.
Programmers
Programmers write the programs. This involves:
(a) Reading the system specification and understanding it.
(b) Recognising what the processing requirements of the program are, in other words, defining
the processing problem in detail.
(c) Having defined and analysed the processing problem, writing the program in a programming
language.
(d) Arranging for the program to be tested.\
(e) Identifying errors in the program and getting rid of these 'bugs' ie debugging the program.
(f) Preparing full documentation for each program within the system.
T = the trust the superior has in the subordinate, and the trust which the subordinate feels
the superior has in him;
C = the degree of control exercised by the superior over the subordinate;
Y = a constant, unchanging value.
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Any increase in C leads to an equal decrease in T; that is, if the manager retains more 'control' or
authority, the subordinate will immediately recognise that he or she is being trusted less. If the
superior wishes to show more trust in the subordinate, this can only be done by reducing C, that is
by delegating more authority.
Span of control
Span of control or 'span of management refers to the number of subordinates or team members
responsible to a person.
Classical theorists suggest:
(a) There are physical and mental limitations to a manager's ability to control people,
relationships and activities.
(b) There should be tight managerial control from the top of an organisation downward. The
span of control should be restricted to allow maximum control.
Project managers may control very large teams. On large projects management layers will be
required between the overall project manager and team members. The appropriate span of control
will depend on:
(a) Ability of the manager. A good organiser and communicator will be able to control a
larger number. The manager's workload is also relevant.
(b) Ability of the team members. The more experienced, able, trustworthy and well-trained
subordinates are, the easier it is to control larger numbers.
(c) Nature of the task. It is easier for a supervisor to control a large number of people if they
are all doing routine, repetitive or similar tasks.
(d) The geographical dispersal of the subordinates, and the communication system of the
organisation.
The span of control has implications for the 'shape' of a project team and of an organisation overall.
An organisation with a narrow span of control will have more levels in its management hierarchy
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the organisation will be narrow and tall. A tall structure reflects tighter supervision and control,
and lengthy chains of command and communication.
A team or organisation of the same size with a wide span of control will be wide and flat. The flat
organisation reflects a greater degree of delegation the more a manager delegates, the wider the
span of control can be.
The wide range of people and skills required to successfully complete a systems development
project has led to the acceptance of flat management structures being the most appropriate for
this process.
The justification is that by empowering team members (or removing levels in hierarchies that
restrict freedom), not only will the job be done more effectively but the people who do the job will
get more out of it.
Project team members must be flexible to be able to respond quickly to specific and varied
customer demands. Team members must therefore be committed.
The following steps may help increase commitment.
(a) Develop identification with the team and the project by means of:
Communications
Participation
Financial bonuses
(b) Ensure that people know what they have to achieve and are aware of how their performance
will be measured against agreed targets and standards.
(c) Introduce a reward system, which relates at least partly to individual performance.
(d) Treat team members as human beings, not machines.
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Project stakeholders
Project stakeholders are the individuals and organisations who are involved in or may be affected
by project activities.
We have already looked at the role of the Project Manager and the Project Team. Other key
stakeholders are defined as follows.
Project sponsor is accountable for the resources invested into the project and responsible for the
achievement of the project's business objectives. The sponsor may be owner, financier, client etc.,
or their delegate.
Project support team is a term used to designate the personnel working on a project who do not
report to the project manager administratively.
Users are the individual or group that will utilise the end product, process (system), or service
produced by the project.
Risk manager. For large projects it may be necessary to appoint someone to control the process of
identifying, classifying and quantifying the risks associated with the project.
Quality manager. For large projects it may be necessary to appoint someone to write the quality
plan and develop quality control procedures.
Project stakeholders should all be committed towards a common goal successful project
completion The Project Plan should be the common point of reference that states priorities and
provides cohesion.
However, the individuals and groups that comprise the stakeholders all have different roles, and
therefore are likely to have different points of view. There is therefore the potential for
disagreements between stakeholder groups.
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management implementing dispute resolution procedures that have minimal impact on costs,
goodwill and project progress.
One approach to dispute management strategy is to organise affairs in a way that minimises
exposure to the risk of disputes. This means employing effective management techniques
throughout all areas of operation.
Partnering
Mediation
On very large projects a Disputes Review Board (DRB) may be formed. This may comprise persons
directly involved in the project engaged to maintain a 'watching brief' to identify and attend upon
disputes as they arise.
Usually there is a procedure in place which provides for the DRB to make an 'on the spot' decision
before a formal dispute is notified so that the project work can proceed, and that may be followed
by various rights of review at increasingly higher levels.
In practice, disputes are often resolved by the acceptance of the view of the party that has the
most financial 'clout' in the project. In such a situation mediation and negotiation may only deliver
an outcome which is a reflection of the original power imbalance.
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alignment with the organisations objectives and strategy, failing which can result in early project
termination.
While the discipline of a PPM approach is perfectly logical, it must be recognised that the outcomes
are often not. If a number of projects are competing for approval at a project board or equivalent,
then the relative strength of support and positions of power of the project champions will often
influence the decision.
External conditions may have an impact it is much harder to get approval for expenditure during
recessionary times, as otherwise important work will be cancelled or postponed.
It is often more difficult to make a case for large-scale in-house projects that do not directly relate
to profitability. For example, a company may have a series of databases within separate
departments that are not integrated. To rationalise them into a consolidated database with much
more potential for improving, Customer Relationship Management could give significant longer-term
returns. The problem is that it might be forgotten when a campaign shows good results that it was
the refined database that pointed the way to better targeting of new clients.
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Traditionally, the key measure of success in projects is achieving the outcome. A successful project
is thus completed within the allocated time and cost and to the desired quality or results (such as
achieving a level of awareness or encouraging people to trial or specific sales results).
The three core issues performance, cost and delivery are clearly sound commercial issues. A
delay in the launch of a movie may mean that it misses a period when demand is traditionally high.
A delay in launching the movie in one market may result in pirated copies there. A poor-quality
soundtrack or editing of a movie may limit customers enjoyment and reduce the possibility of
word-of-mouth referrals. Failing in one of these areas results in loss of revenue and customer
satisfaction. Exceeding the budget will also impact on profitability.
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Project Success
Project managements contribution is now widely recognised as important within the functional
areas of organisations. Business initiatives, activities and campaigns often fit the above definition
of projects. Professional project management gives attention to the various players, tasks and
outcomes for their success.
The consideration of project management will first address the types of projects (activities), how
these are undertaken (people and processes) and why they do it (strategic goals and competitive
position). Success results from their effective co-ordination and integration.
Challenge
Comment
Teambuilding
The work is carried out by a team of people often from varied work and social
backgrounds. The team must 'gel' quickly and be able to communicate
effectively with each other.
Expected
problems
commencement of work.
Unexpected
problems
Delayed benefit
There is normally no benefit until the work is finished. The 'lead-in' time to
this can cause a strain on the eventual recipient who is also faced with
increasing expenditure for no immediate benefit.
Specialists
Potential for
Projects often involve several parties with different interests. This may lead
conflict
to conflict.
21
Clearly defined mission and goals effectively communicated to, and understood by, all
participants.
Top management support that is visible is important in sending out the right messages
regarding the significance of the project.
Competent project manager with the necessary technical and inter-personal skills.
Competent team members with the appropriate knowledge, skills and attitudes. A good team
spirit helps to smooth the path to completion.
Use of effective project management tools such as charts, leading edge software and project
progress meetings.
Clear client focus so that all work is done bearing in mind the needs of internal and external
customers.
Project management ensures responsibilities are clearly defined and that resources are focused on
specific objectives. The project management process also provides a structure for communicating
within and across organisational boundaries.
All projects share similar features and follow a similar process. This has led to the development of
project management tools and techniques that can be applied to all projects, no matter how
diverse. For example, with some limitations, similar processes and techniques can be applied
whether building a major structure (eg Terminal 5 at Heathrow Airport) or implementing a
company-wide computer network.
All projects require a person who is ultimately responsible for delivering the required outcome.
This person (whether officially given the title or not) is the project manager.
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Poor project planning (specifically inadequate risk management and weak project plan)
However, even if all these aspects are satisfactory there are other potential pitfalls that the
project planner must avoid or work around. Here are some examples.
(a) Unproven technology
The use of new technological developments may be a feature of any project. The range of such
developments extends from fairly routine and non-critical improvements, through major
innovations capable of transforming working practices, costs and time scales, to revolutionary
techniques that make feasible projects that were previously quite impracticable. As the
practical potential of a technical change moves from minor to major, so its potential to cause
disruption if something goes wrong with it also increases.
(b) Changing client specifications
It is not unusual for clients' notions of what they want to evolve during the lifetime of the
project.
However, if the work is to come in on time and on budget, they must be aware of what is
technically feasible, reasonable in their aspirations, prompt with their decisions and,
ultimately, prepared to freeze the specification so that it can be delivered.
Note that the term 'client' includes internal specifiers.
(c) Politics
This problem area includes politics of all kinds, from those internal to an organisation managing
its own projects, to the effect of national (and even international) politics on major
undertakings. Identification of a senior figure with a project; public interest and press hysteria;
hidden agendas; national prestige; and political dogma can all have disastrous effects on
project management. Lack of senior management support is an important political problem.
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their strategies. Business circumstances change and new conditions must be met with new
responses or initiatives. Each possible new development effectively constitutes a project in the
terms we have already discussed.
Gray and Larsen (2010) give examples, some of which are noted below.
(a) Compression of the product life cycle: product life cycles have fallen to one to three years, on
average, and it has become necessary to achieve very short time to market with new products
if advantage is to be retained.
(b) Global competition emphasises cost and quality; project management techniques are used to
achieve the new requirements.
(c) Increased product complexity requires the integration of diverse technologies.
(d) Management delayering has eliminated routine middle-management posts while much work has
been outsourced: such organisational change tends to be continuous and project management
techniques are required to get things done in a flexible manner.
(e) Increased customer focus in the form of customised products and close service relationships is
often achieved through a project management approach.
Grundy and Brown (2002) offer an integrative analysis of this trend and suggest three reasons for
taking a project management view of strategic management.
(a) Much strategy appears to develop in an incremental or fragmented way; detailed strategic
thinking may be best pursued through the medium of a strategic project or group of projects.
Project management is a way of making ad hoc strategy more deliberate and therefore betterconsidered.
(b) Strategic implementation is more complex than strategic analysis and choice; a project
management approach, as outlined above, has an important role to play here, but must become
capable of handling more complex, ambiguous and political issues if it is to play it effectively.
When an apparent need for a project emerges, it should be screened to ensure that it supports
the overall strategy.
(c) Even at the smaller, more traditional scale of project management, wider strategic awareness
is vital if project managers are to deliver what the organisation actually needs
Of course, not all new developments are recognised as worthy of project management. For
example, the installation of a new, shared printer in an office would probably be regarded as a
matter of routine, though it would no doubt have been authorised by a responsible budget holder
and installed and networked by a suitable technician. There would probably have been a small
amount of training associated with its use and maintenance and it might have been the subject of a
health and safety risk assessment. All these processes taken together look like a project, if a very
small one.
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In contrast to the multitude of such small events, modern organisations are likely to undergo
significant change far less often, but sufficiently frequently and with developments that have
sufficiently long lives for project management to be an important aspect of strategic
implementation. Project management and change management are thus intimately linked.
An atmosphere of change and continuing development will be particularly evident in relation to
marketing; information systems and technology; organisation structure; and organisation culture.
Level 1
Common knowledge
The importance of project management to the organisation is understood and
training in the basic techniques and terminology is provided.
Level 2
Common processes
The processes employed successfully are standardised and developed so that they
can be used more widely, both for future projects and in concert with other
methods such as total quality management.
Level 3
Singular methodology
Project management is placed at the centre of a single corporate methodology,
achieving wide synergy and improving process control in particular. A separate
methodology may be retained for IS matters.
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Level 4
Benchmarking
Competitive advantage is recognised as being based on process improvement and a
continuing programme of benchmarking is undertaken.
Level 5
Models such as Kerzners are a guide to progress; in particular they indicate corporate training
needs and career development routes for project managers.
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Of these three sets of issues, the need to capture, organise and exploit knowledge is probably the
most pressing for most organisations. An important element of response to this need is therefore an
emphasis on the importance of facilitating effective processes and relationships when designing
structures. Johnson, Scholes and Whittington (2008) use the term configuration to encompass these
three elements.
(a) Structure has its conventional meaning of organisation structure.
(b) Processes drive and support people: they define how strategies are made and controlled;
and how the organisations people interact and implement strategy. They are fundamental
to systems of control.
(c) Relationships are the connections between people within the organisation and between
those internally and those externally.
Effective processes and relationships can have varying degrees of formality and informality and it is
important that formal relationships and processes are aligned with the relevant informal ones.
It is very important to be aware that structures, processes and relationships are highly
interdependent: they have to work together intimately and consistently if the organisation is to be
successful. Here we will be concerned with structures and processes: relationships in this model are
not really relevant to project management.
Structure
An organisations formal structure reveals much about it.
(a) It shows who is responsible for what.
(b) It shows who communicates with whom, both in procedural practice and, to a great extent,
in less formal ways.
(c) The upper levels of the structure reveal the skills the organisation values and, by extension,
the role of knowledge and skill within it.
We are concerned here with the project-structured organisation, but we will approach it via some
other forms that are relevant to it.
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29
In the project-based organisation, specialist functional departments still exist, but their role is to
support the project teams. Since the project teams are staffed from a pool of experts, the
functional structure remains intact and is not weakened by secondments to project work.
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Types of projects
The differences between projects indicate how they should be managed. Brown (2000) sees
projects as spreading across a continuum, with complexity increasing on a number of dimensions.
These dimensions include:
Budget size
Time span
Complexity of tasks
Cross-functional involvement
Co-ordination required
Simple projects, characterised as low budget, short term, simple tasks, within a functional domain,
would require more administrative management. Those that are more complex, with higher
budgets, often with people from different departments (and maybe organisations) and spanning a
longer term would require more sophisticated project management.
Obeng (1994) takes a related approach to characterise four distinct project environments, with
differences in process uncertainty (ie what to do) and the level of outcome uncertainty (ie what
can be achieved) and named the four resulting categories.
1
Paint by numbers Projects are low in process and outcome uncertainty, eg installing point
of sale (POS) displays in retailers outlets. The outcome is the same the installation of the
POS display and the process (the way in which it is implemented) would be similar.
However, differences, such as environmental factors (eg existing store design), time issues
(eg minimising staff and customer inconvenience) and cost issues (eg adaptations for a
given situation) mean this is not a completely routine process. Often, organisations have
process protocols or manuals detailing core processes. These types of projects are
considered hard projects, because of their fixed processes and clarity of outcome.
Making a movie Projects are low in process uncertainty and high in outcome uncertainty.
Producers and directors know what is involved in making the movie, although the topic,
location and people vary. However, predicting the success of the movie is difficult. Projects
such as new product or advertising campaign launches often have a similar pattern of high
costs and a high risk of failure. These projects need clear, precise definition of outcomes,
and stakeholders expectations must be managed throughout the process. Timescales and
budgets must be tightly controlled.
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The quest Projects are high in process uncertainty and low in outcome uncertainty. These
projects have focused outcomes, but it is not clear how or when this will be achieved.
Some exploratory development projects, such as AIDS cures for pharmaceutical companies,
are in this category. Progress and resources reviews throughout these projects are essential
to keep within cost. Further, focus is essential to keep the project on target.
The foggy project Projects are vague in what is involved and in the expected results, so
they have no set process and uncertainty outcomes. The original dot-com companies, like
boo.com and lastminute.com, were foggy projects in their development stages, with little
to guide them. Foggy projects need control over costs and level of risk. Project managers
need to manage stakeholder relationships as the project develops.
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In hard OR, the question of problem definition is seen as relatively straightforward, and is more
a question of finding out what is going on so that some appropriate analysis can be conducted
The key assumption is that this real world can be understood and (sic) a taken-for-granted way.
By contrast, in soft OR, problem definition is seem as problematic and the process of problem
structuring is regarded as crucial to the success of any soft OR. This relates to John Deweys
maxim that, a problem well put is a problem half solved. The world is seen as multi-faceted,
and the approaches adopted to try to understand it are interpretive or pluralistic. Thus,
problem definition is seen as something which must be negotiated between parties who may
have different interests and interpretations. Professor Pidds remarks about problem definition
are as applicable to project management as to OR. The other insight he offers us here is the
idea of hard and soft as extreme points on a spectrum: an awareness that an apparently hard
project has some soft aspects will be very useful to the project manager, as will be an
awareness of the opposite case.
construction
objectives,
for
example,
may
be
approached
via
ambiguous
specifications.
(c) Success measures. Generally, it is easier to measure the degree of success of hard projects than
of soft ones, partly as a result of their higher degree of goal tangibility and clarity. Quantitative
performance measures are associated with hard projects and qualitative with soft. It should not
be assumed that quantitative measures are superior to qualitative ones: each has its place.
Quantitative measures are generally confined to a few variables considered significant in order
to minimise the cost of data capture; this does not give a full picture. Nor are quantitative
measures adequate when projects deal with qualitative matters such as attitude, learning and
morale.
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project
management practice
and is dealt
with
below under
implementation.
(g) Stakeholder expectations. Clear and logical stakeholder relationships are typical in hard
projects, where the emphasis is on efficiency and predictability. Soft projects, because of their
indeterminate nature, require a greater degree of interaction between stakeholders in order to
overcome differences of style, language, assumptions and competence. The credibility of
project staff in the eyes of stakeholders may become an issue.
Implementation considerations
The chances of making a project a success are enhanced if project management methods are
tailored to the degree of its hardness or softness. Hard and soft approaches are not mutually
exclusive and can be combined in ways that reflect the project's position on the various dimensions.
(a) Goal/objective clarity. The extent of clarity in the definition of a project's goals and objectives
affects the methods that are used to move the project forward. Well-defined goals permit the
application of techniques designed to achieve them efficiently. Where there is goal ambiguity,
effort must be deployed on consultation, learning and negotiation in order to reach an
adequate degree of goal definition. These processes will almost certainly have to be continued
throughout the life of the project as new ambiguities arise and have to be dealt with. The
management of the project thus entails as much consideration of what is to be done as of how
to do it.
(b) Project permeability. Where project permeability is low, hard management methods that
concentrate on clear objectives and techniques are appropriate. However, where permeability
is high, a softer approach is needed. It may be necessary to deal with, for example,
bureaucratic, organisational, cultural and political influences that are capable of affecting both
objectives and methods. These influences will probably have to be dealt with sympathetically
and diplomatically. They will require a learning approach to management and a degree of
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35
Chapter 2
Feasibility studies
36
A feasibility study is a formal study to decide what type of system can be developed which best
meets the needs of the organisation.
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(h) Procedures for evaluating and monitoring performance both during and after a project need to
be put in place. Many methodologies require formal sign-off of each stage, but this does not
obviate the need for good project management or for post-implementation evaluation.
(i) Details of the systems development procedures must be agreed. If a commercial methodology is
used, many of these procedures will be pre-determined. Areas to be considered include the
approach to feasibility studies, methods of cost-benefit analysis, design specifications and
conventions, development tools and techniques, reporting lines, contents of standard
invitations to tender, drawing up of supplier conditions and procedures for testing and
implementation.
Terms of reference
The terms of reference for a feasibility study group may be set out by a steering committee, the
information director or the board of directors, and might consist of:
(a) To investigate and report on an existing system, its procedures and costs.
(b) To define the systems requirements.
(c) To establish whether these requirements are being met by the existing system.
(d) To establish whether they could be met by an alternative system.
(e) To specify performance criteria for the system.
(f) To recommend the most suitable system to meet the system's objectives.
(g) To prepare a detailed cost budget, within a specified budget limit.
(h) To prepare a draft plan for implementation within a specified timescale.
(i) To establish whether the hoped-for benefits could be realised.
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Problem definition
In some circumstances the 'problem' (for example the necessity for a real-time as opposed to a
batch processed application) may be quite exact, in others it may be characterised as 'soft' (related
to people and the way they behave).
The problem definition stage should result in the production of a set of documents which define the
problem.
(a) A set of diagrams representing, in overview:
i. The current physical flows of data in the organisation (documents).
ii. The activities underlying them (data flows).
(b) A description of all the people, jobs, activities and so on (entities) that make up the system
and their relationship to one another.
(c) The problems/requirements list established from the terms of reference and after
consultation with users.
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Option evaluation
This stage involves suggesting a number of options for a new system, evaluating them and
recommending one for adoption. It concludes with a final feasibility study report.
Step 1
processing).
(b) Information output (quality, frequency, presentation, eg GUIs, database for
managers, EIS facilities).
(c) Volume of processing.
(d) General system requirements (eg accuracy, security and controls, audit trail,
flexibility, adaptability).
(e) Compatibility/integration with existing systems.
Step 2
Create outlines of project options, describing, in brief, each option. The number
will vary depending on the complexity of the problem, or the size of the
application, but is typically between three and six.
Step 3
Assess the impact each proposal has on the work of the relevant user department
and/or the organisation as a whole.
Step 4
Review these proposals with users, who should indicate those options they favour
for further analysis.
System justification
A new system should not be recommended unless it can be justified. The justification for a new
system would have to come from:
(a) An evaluation of the costs and benefits of the proposed system, and/or
(b) Other performance criteria.
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Technical feasibility
Operational feasibility
Social feasibility
Economic feasibility
Technical feasibility
The requirements, as defined in the feasibility study, must be technically achievable. This means
that any proposed solution must be capable of being implemented using available hardware,
software and other technology. Technical feasibility considerations could include the following.
Response times (how quickly the computer does what you ask it to).
Number of users which can be supported without deterioration in the other criteria.
Operational feasibility
Operational feasibility is a key concern. If a solution makes technical sense but conflicts with the
way the organisation does business, the solution is not feasible. Thus an organisation might reject a
solution because it forces a change in management responsibilities, status and chains of command,
or does not suit regional reporting structures, or because the costs of redundancies, retraining and
reorganisation are considered too high.
Social feasibility
An assessment of social feasibility will address a number of areas, including the following.
Personnel policies
Motivation
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Economic feasibility
Any project will have economic costs and economic benefits. Economic feasibility has three
strands.
(a) The benefits must justify the costs.
(b) The project must be the 'best' option from those under consideration for its particular
purpose.
(c) The project must compete with projects in other areas of the business for funds. Even if it
is projected to produce a positive return and satisfies all relevant criteria, it may not be
chosen because other business needs are perceived as more important.
Cost
Example
Equipment costs
Installation costs
Development costs
These include costs of measuring and analysing the existing system and
costs of looking at the new system. They include software/consultancy
work and systems analysis and programming. Changeover costs, particularly
file conversion, may be very considerable.
Personnel costs
Staff training
Staff recruitment/relocation
Staff salaries and pensions
Redundancy payments
Overheads
Operating costs
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System costs
Draw up a table with three headings: capital cost items, one-off revenue cost items and regular
annual costs. Identify at least three items to be included under each heading. You may wish to
refer back to the preceding paragraphs for examples of costs.
Answer
Capital cost items
Consultancy fees
programmers' salaries
Consumable materials
needed)
Power
Installation costs
Maintenance costs
storage etc)
44
ii.
(b) Extra savings or revenue benefits because of the improvements or enhancements that
the new system should bring:
i.
ii.
(ii) Better stock control (with a new stock control system) and so fewer stock
losses from obsolescence and deterioration.
iii.
(iii) Further savings in staff time, resulting perhaps in reduced future staff growth.
(c) Possibly, some one-off revenue benefits from the sale of equipment which the existing
system uses, but which will no longer be required. Second-hand computer equipment
does not have a high value, however! It is also possible that the new system will use
less office space, and so there will be benefits from selling or renting the spare
accommodation.
Some benefits might be intangible, or impossible to give a money value to
(a) Greater customer satisfaction, arising from a more prompt service (eg because of a
computerised sales and delivery service).
(b) Improved staff morale from working with a 'better' system.
(c) Better decision making is hard to quantify, but may result from better MIS, DSS or EIS.
45
Method
Comment
Payback period
Accounting rate of
This method, also called return on investment, calculates the profits that
return
(DCF)
(a) Net present value (NPV), which considers all relevant cash flows
associated with a project over the whole of its life and adjusts those
occurring in future years to 'present value' by discounting at a rate
called the 'cost of capital'.
(b) Internal rate of return (IRR), which involves comparing the rate of
return expected from the project calculated on a discounted cash
flow basis with the rate used as the cost of capital. Projects with an
IRR higher than the cost of capital are worth undertaking.
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Before looking at each of these methods in turn it is worth considering one problem common to all
of them, that of uncertainty. Estimating future cash flows and other benefits cannot be done with
complete accuracy, particularly as the future period under consideration may as long as five or
even ten years.
It is therefore important that decision makers should consider how variations in the estimates might
affect their decision.
The payback period is the length of time required before the total cash inflows received from the
project is equal to the original cash outlay. In other words, it is the length of time the investment
takes to pay itself back.
Example: Payback
The payback method has obvious disadvantages. Consider the case of two projects for which the
following information is available.
Project P
Project Q
100,000
100,000
10,000
50,000
20,000
50,000
60,000
10,000
70,000
5,000
80,000
5,000
240,000
120,000
Cost
Cash savings
Year
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Solution
Project Q pays back at the end of year two and Project P not until early in year four. Using the
payback method Project Q is to be preferred, but this ignores the fact that the total profitability of
Project P (240,000) is double that of Q.
Despite the disadvantages of the payback method it is widely used in practice, though often only as
a supplement to more sophisticated methods.
Besides being simple to calculate and understand, the argument in its favour is that its use will
tend to minimise the effects of risk and help liquidity. This is because greater weight is given to
earlier cash flows which can probably be predicted more accurately than distant cash flows.
APR =
Example: ARR
Caddick Limited is contemplating a computerisation project and has two alternatives. Based on the
ARR method which of the two projects would be recommended?
Project X
Project Y
Hardware cost
100,000
120,000
10,000
15,000
Estimated life
5 years
5 years
19,000
21,800
depreciation
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Solution
It is first necessary to calculate the average profits (net savings) and average investment over the
life of the project (five years in this example).
Project X
Project Y
95,000
109,000
Total depreciation
90,000
105,000
5,000
4,000
1,000
800
100,000
120,000
(10,000)
(15,000)
90,000
105,000
18,000
21,000
The accounting rates of return are as follows. Project X would therefore be chosen.
Project X =
1,000
=5.56%
18,000
Project Y =
800
=3.8%
21,000
The return on investment is a measure of (accounting) profitability and its major advantages that it
can be obtained from readily available accounting data and that its meaning is widely understood.
Its major shortcomings are that it is based on accounting profits rather than cash flows and that it
fails to take account of the timing of cash inflows and outflows. For example, in the problem above
cash savings in each year were assumed to be the same, whereas management might favour higher
cash inflows in the early years. Early cash flows are less risky and they improve liquidity. This might
lead them to choose a project with a lower ARR.
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Discounted cash flow or DCF is a technique of evaluating capital investment projects, using discounting
arithmetic to determine whether or not they will provide a satisfactory return.
A typical investment project involves a payment of capital for fixed assets at the start of the
project and then there will be profits coming in from the investment over a number of years. When
the system goes live, there will be running costs as well. The benefits of the system should exceed
the running costs, to give net annual benefits.
DCF recognises that there is a 'time value' or interest cost and risk cost to investing money, so that
the expected benefits from a project should not only pay back the costs, but should also yield a
satisfactory return. Only relevant costs are recognised: accounting conventions like depreciation,
which is not a real cash flow, are ignored.
1 is now worth more than 1 in a year's time, because 1 now could be used to earn interest by
the end of year 1. Money has a lower and lower value, the further from 'now' that it will be earned
or paid. With DCF, this time value on money is allowed for by converting cash flows in future years
to a smaller, present value, equivalent.
55,000
115,000
50
150,000
60,000
4 years
Solution
The calculation of NPV is performed as follows.
Year
Cost/Savings
Discount factor
Present value
(150,000)
1.000
(150,000
60,000
0.870
52,200
60,000
0.756
45,360
60,000
0.658
60,000
0.572
Net present value of the project
39,480
34,320
21,360
In this example, the present value of the expected benefits of the project exceed the present value
of its costs, all discounted at 15% pa, and so the project is financially justifiable because it would
be expected to earn a yield greater than the minimum target return of 15%. Payback of the
development costs and hardware costs of 150,000 would occur after 2 years.
One disadvantage of the NPV method is that it involves complicated maths and this might make it
difficult to understand also, it is difficult in practice to determine the true cost of capital.
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Draw up a table which identifies, for each of payback, ARR and NPV, two advantages and two
disadvantages.
Answer
Method
Advantages
Disadvantages
Payback
ARR
NPV
(1)
(2)
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Terms of reference
System requirements
Cost/benefit analysis
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Chapter 3
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Project definition
Project definition is the first stage. Its essential element is the definition of the purpose and
objectives of the project. This stage may include abstract processes of conceptualisation, more
rigorous analysis of requirements and methods, feasibility studies and, perhaps most important, a
definition of scope. The scope of a project is, effectively, what is included and what is not, both in
terms of what it is intended to achieve and the extent of its impact on other parts of the
organisation, both during its execution and subsequently. An important initial consideration will
always be projected cost, even if this cannot be estimated very accurately at this stage.
The project definition stage may also include the procedures required for project selection. We will
discuss this further below, but for now we simply point out that an organisation may be aware of a
larger number of worthwhile projects than it has resources to undertake. Some rational process for
deciding just which projects will proceed is therefore required.
Project design
The project design phase will include detailed planning for activity, cost, quality, time and risk.
Final project authorisation may be delayed until this stage to ensure that the decision is taken in
the light of more detailed information about planned costs and benefits.
Project delivery
The project delivery phase includes all the work required to deliver the planned project outcomes.
Planning will continue, but the emphasis is on getting the work done. Sub-phases can be identified:
(a) The people and other resources needed initially are assembled at start-up.
(b) Planned project activities are carried out during execution.
(c) Completion consists of success or, sometimes, abandonment.
(d) The delivery phase comes to an end with handover. This is likely to include project closure
procedures that ensure that all documentation, quality and accounting activities are
complete and that the customer has accepted the delivery as satisfactory.
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Project development
Handover brings the delivery phase to an end but the project continues through a further stage of
management largely aimed at improving the organisation's overall ability to manage projects.
(a) There should be an immediate review to provide rapid staff feedback and to identify shortterm needs such as staff training or remedial action for procedure failures.
(b) Longer-term review will examine the project outcomes after the passage of time to
establish its overall degree of success. Lifetime costs are an important measure of success.
There should also be longer-term review of all aspects of the project and its management,
perhaps on a functional basis.
It is tempting to ignore the need for project review, especially since, done properly, it imposes
significant costs in terms of management time and effort. It is, however, essential if the
organisation is to improve the effectiveness of its project management in the future.
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Project selection
As already mentioned, it is likely that an organisation will be aware of a greater number of
potentially advantageous projects than it has resources to undertake. It is, therefore, necessary to
select projects carefully in order to make the best use of those limited resources. Project
assessment and selection is analogous to strategic choice, not least because many projects are of
strategic significance. The techniques used for making strategic choices are, therefore, also
applicable. The criteria of suitability, acceptability and feasibility are applicable to many project
choice problems, perhaps reinforced by the use of more detailed assessment techniques such as
those below.
(a) Risk/return analysis using discounted cash flow techniques, expected values and estimates of
attractiveness and difficulty of implementation.
(b) Weighted scoring of project characteristics.
(c) Assessment of organisational priority.
(d) Feasibility studies addressing technical, environmental, social and financial feasibility; such
studies are costly and time-consuming and are likely to be restricted to front-running project
proposals.
(e) SWOT analysis, assessing the strengths and weaknesses of individual projects against the
opportunities and threats facing the organisation.
Pre-initiating tasks
Pre-initiating tasks are the responsibility of the senior managers who decide that the project should
be undertaken.
(a) Determination of project scope and quality, time and cost targets.
(b) Identification of the project sponsor (a senior manager who is accountable for the resources
used by the project manager).
(c) Selection of the project manager.
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Project initiation
When a project has been approved in general terms, it should be the subject of a number of
management processes and tasks in order to initiate it and move into the execution phase. The
exact nature of these processes may well vary from project to project and according to the
particular project management methodology adopted. Schwalbe lists pre-initiating tasks and
initiating tasks. The pre-initiating tasks follow on directly from the formal project selection
process.
Pre-initiating tasks
Pre-initiating tasks are the responsibility of the senior managers who decide that the project should
be undertaken.
(a) Determination of project scope and quality, time and cost targets.
(b) Identification of the project sponsor (a senior manager who is accountable for the resources
used by theproject manager).
(c) Selection of the project manager.
(d) Senior management meeting with project manager to review the process and expectations for
managing
the project.
(e) Decision whether the project actually needs to be divided into two or more smaller projects.
Initiating tasks
Initiating tasks are carried out by the project manager.
(1) Identification of project stakeholders and their characteristics.
(2) Preparation of a business case for the project.
(3) Drafting of a project charter (PRINCE2: project initiation document).
(4) Drafting an initial statement of project scope.
(5) Holding a project initiation meeting ('kick-off' meeting).
58
an extensive project definition stage. This will help to increase the clarity with which overall
objectives are understood, increase motivation and reduce mission creep, which is the tendency for
expectations to increase as time passes.
Musts
Wants
Nice to haves
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Scoping process
Scope statements identify all of the elements of work in the project. A scope statement must be
linked directly to meeting the defined project requirements. For example, a marketing project may
be to investigate and recommend a low cost communication strategy for improving awareness of a
new brand of high fibre bread and thereby increasing sales by 15%.
The project scoping document would specify factors to be considered:
Likely audience/stakeholders
Costings
Timeframes
Resource considerations
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It is likely that in larger projects it will become necessary to adjust the project scope. This might
occur, for example, if resources are unavoidably reduced or it becomes clear that a feasibility
study was too optimistic or too pessimistic. When a change to project scope becomes apparent, it is
important that it is clearly stated and that the revision is approved by the interested stakeholders.
Grundy and Brown (2002) summarise the process of project definition as the preparation of answers
to a series of questions.
A number of techniques that aid analytical thinking may be used when addressing these questions.
Fishbone analysis
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The major issue or problem is shown at the right-hand side of the page and the perceived causes
and influences are shown, in no particular order, on the bones radiating from the central spine.
Each bone can be further analysed if appropriate. It is common to use familiar models such as the
Ms list of resources (men, money, machines and so on) to give structure to the investigation, though
not necessarily to the diagram. The fish bone diagram itself is not, of course, essential to the
process of analysis, but it forms a good medium for brainstorming a problem and for presenting the
eventual results.
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Required for example, where a change is necessary to solve a problem, such as an error in
copy; or where something was not defined correctly in the first instance.
In many sectors, changes to a project plan may indicate that there has been a problem with the
initial project goals or planning. However, as marketing is operating in a dynamic environment,
often changes will be required by factors that are outside the control of the project team. For
example:
The target market segment is changing preferences, for example owing to the economic
environment.
IT consultant Gopal Kapur (2004) says that project managers should act like guide dogs at times,
and show intelligent disobedience.
He comments that as the business environment and business knowledge change, then it is tempting
for project sponsors to ask for changes in the project scope. However, he comments that some of
these changes can be half-baked, and that accepting these can lead to extensive scope creep.
He advises project managers to learn to say no to their sponsors, using the analogy of a guide dog
and its owner going to cross the road. If the owner wishes to cross the road, it is the guide dogs
responsibility tosense the danger, and overrule its owner when appropriate.
Many people working on projects find managing unreasonable expectations from sponsors to be the
most difficult. However, practicing intelligent disobedience can result in a more focused project.
Scope creep is the term when work is added to the project after the scope has been established
and agreed.
Scope creep involves the changes to the projects ongoing requirements or activities increasing,
without approved changes to cost and schedule allowances. Changes can and will occur, but these
need to be managed through a scope management process.
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ACTIVITY
64
65
Project implementation
The majority of the work in projects takes place within the project process. However, this section
is shorter than that for initiation. This is because many of these issues are considered in the other
resources. The first part of implementation is developing an outline plan into an integrative project
plan (Meredith and Mantell, 2003), including:
1
The general approach of the managerial and technical aspects of the project how this links or
deviates from existing approaches and projects. This would include the choice of the
appropriate project management methodologies.
Contractual requirements the reporting processes of all parties, the review processes,
agreements with third parties and schedules. Information on changes to the plan, including
rescheduling, the substitution of suppliers or cancellation of the contract should also be
determined.
Schedules for the work the components parts and key milestones in the progress of the
project. The project scope should be broken down (decomposed) into parts. This depends on
the chosen work breakdown structure (WBS). At its simplest, a WBS is a structured and itemised
to do list. Each task should be detailed, with time estimates. Timings should be agreed by the
project manager.
Resource issues the detailed budget should be included, as should the project budget
monitoring process.
Personnel requirements the skills required, and processes and criteria for selection of
employees, training programmes.
Methods and standards of evaluation mechanisms for collecting and storing data on the
progress of the project should be determined.
10 Contingency planning most plans have some form of contingency planning. The approach and
allowances for this is part of the main project plan.
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Stakeholder interests
It is important to understand who has an interest in a project, because part of the responsibility of
the project manager is communication and the management of expectations. An initial assessment
of stakeholders should be made early in the projects life, taking care not to ignore those who
might not approve of the project, either as a whole, or because of some aspect such as its cost, its
use of scarce talent or its side-effects. The nature and extent of each stakeholders interest in, and
support for (or opposition to) the project should be established as thoroughly as possible and
recorded in a stakeholder register. This will make it possible to draw on support where available
and, probably more important, anticipate and deal with stakeholder-related problems. The project
manager should be aware of the following matters for each stakeholder or stakeholder group:
(a) Goals
(b) Past attitude and behaviour
(c) Expected future behaviour
(d) Reaction to possible future developments
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Managing stakeholders
It is important to be thorough in assessing stakeholders: a failure to identify and consider a
stakeholder group is likely to lead to problems. Here is a list of individuals and groups that might be
expected to have a stake in a project.
(a) The project manager reputation and even employment are at stake.
(b) The project team they have to work on the project but may have other roles and higher
personal priorities.
(c) The project sponsor/ budget holder this senior figure will demand high standards but may be
reluctant to fund all the desirable resources.
(d) The customers may be external or internal and may break down into several groups, such as
an internal user group and an external group who should receive improved service as a result of
the enhanced capability the user group should acquire on successful completion of the project.
(e) Managers and staff in supporting functions such as finance and HR can have extensive influence
on the project and its chances of success.
(f) Line managers of seconded staff their own work and prospects may be disrupted.
(g) Other project managers, teams and sponsors rivalry for resources may cause conflict.
(h) Regulators and auditors of all kinds, both internal and external, are likely to take an interest in
a project.
Project stakeholders may be divided into two main groups.
(a) Process stakeholders have an interest in how the project process is conducted. This group
includes those involved in it, those who want a say in it, and those who need to evaluate and
learn from it.
(b) Outcome stakeholders have an interest in the outcomes, results or deliverables of the project.
This group includes not only the customer groups described above, but also, typically, some
regulators and compliance staff.
The project manager must manage a broad range of complex relationships if the project is to
succeed. This amounts to achieving co-operation through influence rather than authority. Gray and
Larson (2008) speak of creating a social network to manage the relationships with those the project
depends on. The project manager should know whose co-operation, agreement or approval is
required for the project to succeed and whose opposition could prevent success. It is particularly
important to enlist the support of top management. This not only brings an adequate budget, it
signals the project's importance to the organisation and enhances the motivation of the project
team.
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Duty
Comment
Outline planning
Detailed planning
Teambuilding
Communication
The project manager must keep supervisors informed about progress as well
as problems, and ensure that members of the project team are properly
briefed.
Co-ordinating
project
activities
Between the project team and users, and other external parties (eg suppliers
of hardware and software).
Monitoring and
control
The project manager should estimate the causes for each departure from the
standard, and take corrective measures.
Problem-resolution
Quality control
Risk management
A key consideration is project failure and hence project risks and potential
risk areas must be identified and monitored.
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The project management process helps project managers maintain control of projects and meet
their responsibilities.
70
Building
Project
administration
Communication
Technical
Personal
Patience is required even in the face of tight deadlines. The quickfix may eventually cost further time than a more thorough but
initially more time-consuming solution.
71
You should note carefully the difference between the skills required and the responsibilities of the
project manager.
Worksheet example
Project Skill Requirements
Project Name:
Project M
Task
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Skill needed
Responsibility
The completed worksheet provides a document showing the skills required of the project team.
Deciding who has the skills required for each task and if possible seconding those identified to the
project team, should be done as early as possible. Team members should then be able to
participate in the planning of schedules and budgets. This should encourage the acceptance of
agreed deadlines, and a greater commitment to achieve project success.
The individuals selected to join the team should be told why they have been selected, referring
both to their technical skills and personal qualities. This should provide members with guidance as
to the role they are expected to play.
Although the composition of the project team is critical, project managers often find it is not
possible to assemble the ideal team, and have to do the best they can with the personnel available.
If the project manager feels the best available team does not possess the skills and talent required,
the project should be abandoned or delayed.
Once the team has been selected each member should be given a (probably verbal) project
briefing, outlining the overall aims of the project, and detailing the role they are expected to play.
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Chapter 4
75
Project management approaches vary substantially, across a continuum, with the following
extremes:
Organisations have no formal methodology, which means that the project manager has all the
information and plans. Team members may be less involved or committed because they lack
information. Management may be given only limited information on progress, as reporting takes
time.
An organisation-wide methodology is applied for all projects and departments. Usually, this is a
sophisticated methodology, which prepares plans, metrics, communications tasks etc. Often, these
methodologies require training for all participants. However, an overly complex methodology may
be cumbersome for some projects, such as simple, soft or creative projects, and may demotivate
people.
Between these extremes, there are many off-the-shelf software packages for managing projects,
including Microsoft Project. Typically, these require some training, but are not the highly specialist
project management methodologies. These packages identify the core processes and reporting that
is required in project management, and can be bought or licensed for application. Pre-established
packages are cheaper than the specialist packages. They may increase project management
efficiency by automating planning and reporting processes. In turn, this improves effectiveness,
such as reducing risks.
These packages are flexible enough to take account of a projects unique aspects and can be
customised for marketing projects, but there are also off-the-shelf software packages specifically
for marketing projects.
A second option is to buy an existing methodology and customise it (or have it customised) for a
specific situation. This is generally for more sophisticated projects and project-focused
organisations. There is a fine line here between the adaptation of an existing methodology and the
development of in-house methodologies, customised for an organisations skills, values and best
practices. The latter are becoming less common with ever-increasing numbers of quality project
management software. Sophisticated customised packages are typically time consuming and
expensive, and staff must be trained to use these.
The Microsoft Office Project package details its key benefits, gives you the chance to see a
demonstration and also to download this for a 60-day free trial. If you do not know any other
package, you might like to plan your assessment for this module on this package. (But remember
the 60-day limit, if your company does not have a license for this!)
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http://www.microsoft.com/project/en-us/project-management.aspx
This software offers a quick tour of the highlights of the software, and also offers a trial. There is
detailed information on product features, including various reports. Also check out the case studies
for insight.
http://www.wrike.com/
This is an online project management service, and offers the product features, free demonstration
and also case studies and testimonials. Interestingly, this software works directly with e-mail
systems to ensure better team collaboration. It also specifically targets marketing professionals and
products.
http://www.projectminder.com/
The site makes available software for project management that is focused on vertical markets,
including consultancies and agencies. This is very strongly focused on managing time and cost. This
site has interesting white papers for those in these sectors. It also offers a small business version.
PRINCE/PRINCE2
Scalable methodology
Process methodologies are those that follow a formal planning stage, whereby processes are
determined for undertaking the project.
PRINCE/PRINCE2
PRINCE (PRojects INControlled Environments) methodologies are commonly used in public sector
project management, although they were originally designed for developing and implementing
information systems. It is the default methodology for public sector organisations in the United
Kingdom, and is widely used by large organisations across Europe. A related approach is Managing
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Control procedures
A focus on products deliverables to the customer and project deliverables for the
management of the project
The business The Business Assurance Co-ordinator (BAC) ensures that the project meets the
organisations mission.
The specialist The Technical Co-ordinator is responsible for ensuring that the project does not
have technical problems.
The user The User Assurance Co-ordinator represents the user throughout the process. These
different roles ensure that the various stakeholders agree that the project is satisfactory (in
terms of the cost, quality and delivery) from all perspectives.
Tie up resources
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Scalable methodology
Scalable methodology recognises the differences in project size, risk and complexity, and allows a
customised best practice management approach for each project. This approach builds on the
Project Management Institutes PMBOK (Project Management Body of Knowledge), identifying
differences between minor and major projects on nine dimensions and their impact on project
management.
Agile methodologies
A change in recent years has come about owing to criticisms of the process-driven methodologies
(such as PRINCE2 and scalable methodology) because they lacked the capacity to adapt as the
project developed. New agile methodologies were developed, which allow the project to adapt to
changes in the changing environment and business challenges. Although they are seen as
contrasting with the process methodologies, they are actually considered to be half-way between
a process methodology and no methodology.
Agile methodologies are defined as being:
Adaptive rather than predictive Agile approaches welcome changes, rather than have fixed plans.
Focused on people rather than process Process methods focus the process set, and anyone could
implement the plans. Agile approaches recognise that people have skills that can add to the project
as it progresses.
ADF allows project scope to vary within defined time and cost levels. The project scope is reviewed
in several iterations, by involving the client in identifying the issues that are of most value to the
business. This means that the project changes course to deliver the maximum business value.
This approach was developed for IT projects, after many of them failed to deliver using the
traditional and more rigid methodologies. However, its focus and flexibility make it appropriate for
marketing projects.
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Choosing a methodology
The choice of a project methodology is commonly set given the preferences of the commissioning
organisation.
However, if you have an open choice of methodology, you should consider the following issues to
make an informed choice:
Availability of software
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Table PPT
Project name
Project manager
The project manager is Joe Bloggs. The project manager is authorised to (1)
initiate the project, (2) form the project team and (3) prepare and execute
plans and manage the project as necessary for successful project
completion.
Purpose/Business
This project addresses a need for high-level guidelines for the project
need
Project
The project team will use project methodology consistent with PMI
management
Assumptions,
The project faces some increased risk that without a clearly prescribed
Resources
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Be conversant in English and be able to use telephone and internet email telecommunications
As possible
Diversity
(Team
members
collectively
may
represent
diverse
Approach
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The project manager and team will communicate with and report to the PI
reporting
Lessons learned
The project manager will submit the final product and any interim
deliverables to the Standards Program Team (SPT) for formal acceptance.
The SPT may (1) accept the product as delivered by the project team, or (2)
return the product to the team with a statement of specific requirements to
make the product fully acceptable. The acceptance decision of the SPT is to
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Requests for change to this plan may be initiated by either the project
management
sponsor or the project manager. All change requests will be reviewed and
approved or rejected by a formal proceeding of the Standards Program
Team (SPT) with input and interaction with the project manager. Decisions
of the SPT will be documented and provided to the project manager in
writing. All changes will be incorporated into this document, reflected by a
new version number and date.
12 July 20XX
Fred Jones Pl Technical Research & Standards Manager
By Project Manager
20 July 20XX
Joe Bloggs Pl member
The format and contents of a project management plan will vary depending on the organisation
involved and the complexity of the project.
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Chapter 5
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What timescale?
Initial scoping helps identify some aspects of the project, but this next stage of planning adds to
the detail for the project plan and clarifies more precisely what is involved. There is an old saying
that the devil is in the detail and it is certainly true that you will have the devil of a time trying
to successfully manage a marketing project if you fail to pay attention to detail.
The general process of project planning is the structure of this chapter.
1
Allocating responsibilities
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Sequencing work
The key project management tools will be identified within these headings.
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1 Define the needs what do we need to allocate to the system and what do we need in return?
Research the suppliers that potentially have suitable software/hardware to satisfy our needs
Shortlist those suppliers we will invite to bid after more detailed research eg costs,
testimonials, Product limitations.
(Note that this is only the start of the structure for illustrative purposes and it may go down
through many more levels until it is broken down into discrete work pack ages. You may also note
that the text that follows the diagram reflects the hierarchic al structure of the diagram.)
The WBS will go down through a series of levels until the project tasks produce manageable
outputs. These are called work packages. Work packages are normally viewed as being
deliverables or products at the lowest level of the WBS. Deliverables are the tangible outputs from
work, which are normally then signed off as complete. This may be a milestone the end of a
period of work.
Identifying the work packages forms the foundation for developing schedules, budgets and resource
requirements, and also forms the foundation for assigning responsibilities.
Work packages can be split into activities or tasks that are used to create a workflow. These
contrast with activities and tasks, which are about what is involved in doing work.
Figure BPP looks at the process that would be involved in the purchasing of the CRM software
outlined in Figure WBS It considers a traditional purchasing of traditional physical goods with the
alternative of buying software. Again, remember that it is included as an illustration, and you may
very well see variations in your organisation.
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Some people refer to the 80-hour rule to make the decision about the bottom level. The bottom
level of a WBS should identify 80 hours or fewer of work. This WBS is the foundation for the other
elements of the project plan. The project managers mantra states that if it is not in the WBS,
then it is not in the plan. Clearly, there must be attention to this for the project to be successful,
but you may well miss some issues if you are new to project management.
Seek advice from others to check that this is not a major issue.
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and
interactions. At any level of WBS analysis, some tasks will be dependent on others; that is to say, a
dependent task cannot
analysis of dependencies is a major step towards a workable project plan, since it provides an order
in which things must be tackled. Sometimes, of course, the dependencies are limited and it is
possible to proceed with tasks in almost any order, but this is unusual. The more complex a
project, the greater the need for analysis of dependencies.
Interactions are slightly different; they occur when tasks are linked but not dependent. This can
arise for a variety of reasons: a good example is a requirement to share the use of a scarce
resource. If there were two of us working on our vegetable plot but we only possessed one spade,
we could not use it simultaneously both to cultivate the plot itself and to dig the trench in which
we wish to place the kerbstones. We could choose to do either of these activities first, but we
could not do them both at the same time.
The output from the WBS process is a list of tasks, probably arranged hierarchically to reflect the
disaggregation of activities. This then becomes the input into the planning and control processes
described in the rest of this section.
uses
a product-based approach to
planning. This has the advantage of directing management attention to what is to be achieved
rather than how to do it, thus providing an automatic focus on achieving the product goals. Also, it
can be helpful in complex projects, where the processes involved may be initially unclear.
Under this approach, work breakdown is preceded by product breakdown. PRINCE2 starts this
analysis by dividing the project products into three groups.
a) Technical products are the things the project has been set up to provide to the users. For an
IT system, for example, these would include the hardware, software, manuals and training.
b) Quality products define both the quality controls that are applied to the project and the
quality
Standards the technical products must achieve.
c)
Management products are the artefacts used to manage the project. They include the
project management organisation structure, planning documentation, reports and so on.
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Consider similar activities for which you have information about the task duration. However,
this may not be possible for all tasks.
Historical data may identify how long tasks or activities have taken in the past. However, some
project tasks may be new tasks.
Expert advice or knowledge from senior managers can give indications of the likely or
desired outcomes.
Lack of experience in planning time du ration for tasks, and in doing activities.
Clearly, novices will typically take longer than experienced workers to do the same tasks, and
may be unaware of the problems that take time. Clearly, lack of experience here can lead to
unrealistic timescales.
Complexity of the marketing problems often these involve creative tasks, for which focusing
on time may detract from quality.
Unexpected events or delays due to illness etc. Also, mistakes or other problems can add to the
time needed. Contingencies may have to be built into the systems.
Novices tend to underestimate the amount of work involved in any tasks. Expert project
managers tend to use the longest predicted duration in scheduling, as this allows for possible
delays.
There is a dual issue here. It is very difficult to judge the time taken for new projects or new
activities or tasks. Some tasks involved in marketing activities such as creative work are
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especially difficult to do to a timescale. This in turn will impact on the feasibility of the project
completion date.
Sequencing work
The tasks so far have complexities, but the real difficulties in project planning come through
scheduling. Scheduling is essentially about the links between and among activities/tasks and or
people and organisations. Some work tasks will be completed in parallel, while others will be
dependent on the completion of other activities.
Scheduling examines the sequence of tasks, both independent and interrelated, that will be
undertaken. This is then organised into a series of subschedules and charts, which can be prepared
from the master plan, detailing what will happen when, by whom, and detailing the interfaces and
the milestones for the tasks.
For example, a brochure cannot be printed until the content has been prepared. The content
cannot be prepared until a copywriter has been appointed and the R&D team has provided the
product information. However, a printer can be sourced while the copy is being written.
Once you know what needs to be done, you need to examine the work involved to determine:
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task is normally named and numbered, and the duration of tasks, any lead or lag times, and
resources and budget involved must be estimated in order for a detailed schedule to be
undertaken. Clearly, this reinforces the need for good time and resource estimates. Each WBS task
should become the responsibility of a named individual.
However, schedules will often feature ideal start dates and late finish dates. Ideal start dates are
the latest dates for an activity to start, if delays are to be avoided. Late finish dates are the latest
dates for an activity to finish without causing delays in the project.
Later in the project, revised schedules are prepared as issues emerge. Rescheduling does not
always result in delays in completion, as contingencies for time or budget may be built into the
project plan. However, if the delays exceed this, and there is no flexibility with the de livery date
or resources, terminating the project should be considered. Many tools are used to present
schedules.
Gantt charts
Gantt charts are a visual planning tool useful for projects but are limited in their use as they do
not recognise the interrelations between tasks.
A Gantt chart , named after the engineer Henry Gantt who pioneered the procedure in the early
1900s, is a horizontal bar chart used to plan the time scale for a project and to estimate the
resources required.
The Gantt chart displays the time relationships between tasks in a project. Two lines are usually
used to show the time allocated for each task, and the actual time taken.
A simple Gantt chart, illustrating some of the activities involved in a network server installation
project, follows.
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The chart shows that at the end of the tenth week Activity 9 is running behind schedule. More
resources may have to be allocated to this activity if the staff accommodation is to be ready in
time for the changeover to the new system.
Activity 4 has not been completed on time, and this has resulted in some disruption to the
computer installation (Activity 6), which may mean further delays in the commencement of
Activities 7 and 8.
Network analysis
Network analysis, also known as Critical Path Analysis (CPA), is a useful technique to help with
planning and controlling large projects, such as construction projects, research and development
projects and the computerisation of systems.
Network analysis requires breaking down the project into tasks with estimated durations and
establishing a logical sequence. This enables the minimum possible duration of the project to be
found.
CPA aims to ensure the progress of a project, so the project is completed in the minimum amount
of time.
It pinpoints the tasks which are on the critical path, ie those tasks which, if delayed beyond the
allotted time, would delay the completion of the project as a whole. The technique can also be
used to assist in allocating resources such as labour and equipment.
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Estimating the time needed to complete each individual activity or task that makes
up a part of the project.
Step 2
Sorting out what activities must be done one after another, and which can be done
at the same time, if required.
Step 3
Step 4
Example
The table below shows the Activities, time scales and precedences of a particular project.
This information could be used to construct the network diagram shown below the table.
Activity
A
B
C
D
E
F
G
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Expected time
3
5
2
1
6
3
3
Preceding
activity
B
A
A
D
C,E
Activity-on-node presentation
Network diagrams may also be drawn using Activity-on-node presentation which is similar in style to
that used by the Microsoft Project software package.
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(b)
(c)
A second possibility is that an activity cannot start until two or more activities have been
completed. If activity H cannot start until activities G and F are both complete, then we would re
present the situation like this.
Preceding activity
B&C
The first solution that follows excludes start and end nodes the second solution includes them.
Solution
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Any network can be analysed into a number of different paths or routes. A path is simply a
sequence of activities which can take you from the start to the end of the network.
In the example above, there are just three possible routes or paths (based on the precedences
given earlier).
(a) A C D.
(b) B D.
(c) B E.
6 days
Note that there are a range of acceptable notation styles for network diagrams. You should learn
the principles of the technique so you are able to interpret diagrams presented in a variety of
formats (with an explanatory key).
Duration (weeks)
C,D
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We could list the paths through the network and their overall completion times as follows.
Path
Duration (weeks)
ACG
(5 + 2 + 4)
11
BDG
(4 + 1 + 4)
BE
(4 + 5)
BFH
(4 + 5+ 3)
BFI
(4 + 5 + 2 + 0)
The critical path is the longest, BFH, with a duration of 12 weeks. This is the minimum time needed
to complete the project.
The critical path may be indicated on the diagram by drawing thick (or double-line) arrows, or by
the addition of one or two small vertical lines through the arrows on the critic al path. In Microsoft
Project the arrows and the nodes are highlighted in red.
Listing paths through the network in this way should be easy enough for small networks, but it
becomes a long and tedious task for bigger and more complex networks. This is why software
packages are used in real life.
Conventionally it has been recognised as useful to calculate the earliest and latest times for
activities to start or finish, and show them on the network diagram. This can be done for networks
of any size and complexity. Project management software packages offer a much larger variety of
techniques than can easily be done by hand. Microsoft Project allows each activity to be assigned to
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any one of a variety of types: 'start as late as possible', 'start as soon as possible', 'finish no earlier
than a particular date', 'finish no later than a particular date', and so on.
In real life, too, activity times can be shortened by working weekends and overtime, or they may
be Constrained by non-availability of essential personnel. In other words with any more than a few
activities the possibilities are mind-boggling, which is why software is used.
Nevertheless, a simple technique is illustrated in the following example.
diagram.
(b) An ID number which is unique to that activity. This helps computer packages to understand the
diagram, because it is possible that two or more activities could have the same name.
For instance two bits of research are done at different project stages might both be called
'Research'.
(c) The duration of the activity.
(d) The earliest start time. Conventionally for the first node in the network, this is time 0.
(e) The latest start time.
(Note: Don't confuse start times with the 'event' times that are calculated when using the activityon-arrow method, even though the approach is the same.)
Task D
ID number:
4
Duration:
6 days
Earliest start:
Day 4
Latest start:
Day 11
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10 5 =
week 5. However, if it starts in week 5 it not be possible to start activity H on time and the
whole project will be delayed. We therefore take the lower figure.
The final diagram is now as follows.
Critical activities are those activities which must be started on time, otherwise the total project
time will be increased. It follows that each event on the critical path must have the same earliest
and latest start times. The critical path for the above network is therefore B F H.
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Preceded by activity
Duration Day
Workers required
C,E
There is a multi-skilled workforce of nine workers available, each capable of working on any of the
activities. Draw the network to establish the duration of the project and the critical path. Then
draw a Gantt chart, using the critical path as a basis, assuming that jobs start at the earliest
possible time.
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Solution
Here are the diagrams.
It can be seen that if all activities start at their earliest times, as many as 15 workers will be
required on any one day (days 6-7) whereas on other days there would be idle capacity (days 8-12).
The problem can be reduced, or removed, by using up spare time on non-critical activities. Suppose
we deferred the start of activities D and F until the latest possible days. These would be days 8 and
9, leaving four days to complete the activities by the end of day 12.
The Gantt chart would be redrawn as follows.
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Resource histogram
A useful planning tool that shows the amount and timing of the requirement for a resource (or a
range of resources) is the resource histogram.
A resource histogram shows a view of project data in which resource requirements, usage, and
availability are shown against a time scale.
A simple resource histogram showing programmer time required on a software development
program is shown below.
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Some organisations add another bar (or a separate line) to the chart showing resource availability.
The chart then shows any instances when the required resource hours exceed the available hours.
Plans should then be made to either obtain further resource for these peak times, or to re-schedule
the work plan. Alternately the chart may show times when the available resource is excessive, and
should be re-deployed elsewhere. An example follows.
The number of workers required on the seventh day is 13. Can we re-schedule the non- critical
activities to reduce the requirement to the available level of 10? We might be able to re-arrange
activities so that we can make use of the workers available from day 9 onwards.
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Chapter 6
108
Estimates (and therefore budgets) cannot be expected to be 100% accurate. Business conditions
may change, the project plan may be amended or estimates may simply prove to be incorrect.
Any estimate must be accompanied by some indication of expected accuracy.
Estimates can be improved by:
a) Learning from past mistakes.
b) Ensuring sufficient design information.
c) Ensuring as detailed a specification as possible from the customer.
d) Properly analysing the job into its constituent units.
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realistic,
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Strategic planning: The group is in private ownership and business decisions are made inhouse. No short-term focus on stock market performance pervades and therefore plans are
made on a sound business project platform.
2. Strategic business entities: The group is structured under a corporate brand and the
individual companies operate independently. Therefore each individual company is charged
with managing and mitigating its own risk while protecting the collective.
3. Risk splitting: Whenever an individual company hits a certain volume of business it is
divided into two or more units. This minimises failure and reduces overall risk to the group.
This strategy is in effect one of anti-risk contagion.
4. Source of funds: Partnerships with other organisations owning superior competencies are
leveraged with the Virgin corporate brand so as to pool resources and spread the risk.
(Sonia Jaspals RiskBoard, 2010)
Risk management
Project managers must address the levels of risk. Foundations of project risk management are
summarised here.
The project risk management process
1
Risk identification have you identified the risks for the project, and the implications of these
on the business?
Risk analysis have you identified risks, and the chances of these affecting the time, cost,
performance and outcomes of the project, and what the consequences of these risks are?
Risk planning have you prepared contingency plans to avoid, address or minimise risks to the
project achieving its time, cost and performance outcomes?
Risk monitoring have you got a system in place to monitor these potential risks and to pick up
on any other risks that might impact on the project process or outcomes?
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Other factors
Some other common factors are identified below.
(a)
The project manager may accept an unrealistic deadline the timescale is fixed early in the
planning process. User demands may be accepted as deadlines before sufficient
consideration is given to the realism of this.
(b)
(c)
(d)
Users change their requirements, resulting in costly changes to the system as it is being
developed.
(e)
Poor time-tabling and resourcing. It is no use being presented on day 1 with a team of
programmers, when there is still systems analysis and design work to do. The development
and implementation of a computer project may take a considerable length of time (perhaps
18 months from initial decision to operational running for a medium-sized installation); a
proper plan and time schedule for the various activities must be drawn up.
If the sole aim of a project is to meet administrative needs that are not time
dependent, then cost may be the dominant factor.
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The balance of time, cost and quality will influence decision making throughout the project for
example whether to spend an extra 5,000 to fix a problem completely or only spend 1,000 on a
quick fix and implement a user work-around?
Comment
After considering all options it may be decided that things should be allowed to
continue as they are.
If capable staff are available and it is practicable to add more people to certain
Add resources
tasks it may be possible to recover some lost ground. Could some work be
subcontracted?
Work smarter
Consider whether the methods currently being used are the most suitable for
example could prototyping be used.
If the assumptions the original plan was based on have been proved invalid a
Replan
more
realistic plan should be devised
Reschedule
Introduce
incentives
Change the
If the original objectives of the project are unrealistic given the time and
specification
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Changes in personnel
The earlier a change is made the less expensive it should prove. However, changes will cost time
and money and should not be undertaken lightly.
When considering a change an investigation should be conducted to discover:
The risks associated with the change, and with the status-quo.
The process of ensuring that proper consideration is given to the impact of proposed changes is
known as change control.
Changes will need to be implemented into the project plan and communicated to all stakeholders.
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A B2B manufacturer set in place a project to develop and launch a website for its partners (ie
intermediaries), which would offer a range of information, administration and support activities.
The intention was to move the partners away from more labour intensive forms of dealer support,
which would enable the partners to give better service to their customers. The project budge t was
set at the cost of running a call centre for handling partner enquires and support over a two year
period. The cost-saving was to be split between the manufacturer and its trade partners. Therefore
moving to this new website, once developed, would improve channel margins. The basic form of
Microsoft Project was engaged and this was supported by other in-house physical planning and
scheduling techniques.
The website development went through several project stages, such as specification, routing,
content development and testing. The initial testing involved mirroring a sample of queries
managed through the dealer support call centre. Beta testing of the site amongst selected partners
was put in place, with pop up questionnaires, observations and discussions to review their site
usage, attitudes, etc.
Modifications as a result of the pilot project were made to the process, and the full-scale launch
was signed off into the mainstream company activity within the original time schedule.
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117
The advantages of using project management software are summarised in the following table.
Table SB Software benefits
Advantage
Comment
Enables quick
replanning
Document quality
Encourages constant
progress tracking
and easily. Many project managers conduct this type of analysis using
copies of the plan in separate computer files leaving the actual plan
untouched.
Complexity
Software can handle projects of size and complexity that would be very
difficult to handle using manual methods.
The software also has several disadvantages, some of which also apply to manual methods.
(a)
Focus. Some project managers become so interested in software that they spend too
much time producing documents and not enough time managing the project. Entering
actual data and producing reports should be delegated to an administrator.
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(b)
Work practices. The assumptions behind work breakdown structure are not always
applicable: people tend to work in a more flexible way rather than completing discrete
tasks one by one.
(c)
Estimates. Estimation is as much an art as a science and estimates can be wildly wrong.
They are subject to the experience level of the estimator; influenced by the need to
impress clients; and based on assumptions that can easily change.
(d)
Human factors. Skill levels, staff turnover and level of motivation can have profound
effects on performance achieved. Also, human variation makes rescheduling difficult
since employing more people on an activity that is running late may actually slow it
down at first, while the newcomers are briefed and even retrained.
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Chapter 7
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Project monitoring
Marketers are familiar with the concept of a planning and control cycle. Planning and control is
different within the project environment from the analysis, planning, implementation and control
cycle in marketing. Project managers focus on planning, monitoring and controlling. Planning was
addressed earlier, and so now the focus moves to the monitoring phase.
According to Meredith and Mantell (2003): Monitoring is the collecting, recording and reporting
information concerning any and all aspects of project performance that the project manager or
others in the organisation wish to know.
Tracking and monitoring progress helps to ensure an effective and efficient project, by reviewing
project implementation against the approved plan and budget. Monitoring focuses on tracking data
about activities and progress. It needs to be built on a good plan and substantial data. The design
of a realistic chain of results, outcomes, outputs and activities is particularly important.
Monitoring cannot make a project successful it is a neutral part of the project process. However,
timely monitoring (followed by effective control) can help identify and avoid if necessary the
three Cs that challenge projects:
Crises
Catastrophes
Change
Monitoring is usually the responsibility of the project co-ordinator and may be carried out
informally (through weekly briefs) or through routine review of the project documents. The
minimum forms of review for a project should be on the triple constraints or:
Time (schedule)
Cost (budget)
Performance
Progress to date
Project monitoring normally relies on the parent organisation having a robust internal information
system for monitoring and control.
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The project monitoring system needs to be specified at the project initiation. Typically, this will
look at the data collection process, the standards and the performance criteria. Unfortunately,
these may change over time, because of changes affecting scope, legal change s or other budgetary
or business priorities.
The monitoring system should also consider project mile stones of performance criteria (such as the
number of changes to plan or variations in resources usages).
The project action plan, WBS system and the further more detailed subplans are the reference for
this. These describe the project activities, tasks, schedules, resource levels and costs for all
elements. However, these factors may not identify all elements needed for project monitoring.
Indeed, focusing on monitoring activity, rather than the output, is a common error. A project may
have a considerable amount of activity, but the output may still be hidden. Focusing on the activity
may mask the problems in creating output.
Reporting progress
The above material has identified various ways of monitoring progress, but these analyses are not
only for the project manager. Commonly, monitoring is communicated to others through reports
and meetings. Reports can be prepared by the project team, or prepared by independent auditors,
depending on the organisation, type of project and the level of project risk. The reports will al so
form the record on which the project history will be based. However, the project manager has the
ultimate responsibility for defining how reports and meetings are managed.
An executive status report, for the project sponsors or other key stakeholders who are not
directly involved in the project activities. These should be prepared on an agreed schedule,
often monthly or quarterly, and timed to fit with meetings with executive stakeholders.
The focus of this report should be on the top-level issues affecting progress and plans.
Project progress status reports will be prepared on a regular time schedule. Projects with
full-time team members or working within a tight schedule will commonly have these
prepared weekly. Part-time projects may have a less frequent reporting schedule, as long
as they do not have a short time duration.
Project status reports are normally prepared by those in key roles in the project team. These
keep the project manager and project team up-to-date with progress or problems, and enable
all to be aware of plans to reduce problems or recover from problems.
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The frequency and contents of progress reports will vary depending on the length of, and the
progress being made on, a project.
The report is a control tool intended to show the discrepancies between where the project is,
and where the plan says it should be. Major considerations will be time and cost and reports
will highlight comparisons of planned and actual progress.
Any additional content will depend on the format adopted. Some organisations include only the
raw facts in the report, and use these as a basis for discussion regarding reasons for variances
and action to be taken, at a project review meeting.
Other organisations (particularly those involved in long, complex projects) produce more
comprehensive progress reports, with more explanation and comment.
Gray and Larson (2010) suggest the following basic format for a control report:
1. Progress since last report
2. Current project status
Time schedule
Cost Scope
3. Cumulative trends
4. Problems and issues since last report Actions and resolution of earlier problems New
variances and problems identified
5. Corrective action planned
Actual cost of work completed (AC). This is the amount spent to date on the project.
(b)
Planned value of the work scheduled to date ( PV). The amount that was budgeted to
be spent to this point on scheduled activities.
(c)
Earned value (EV). This figure is calculated by pricing the work that has actually been
done using the same basis as the scheduled work.
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Yellow
Signifies the work is behind target, but the slippage is recoverable. Yellow indicates
that some problem areas have been identified, but corrective actions can be taken
to deal with them.
Red
Signifies the work is behind target and will be difficult to recover. A red traffic
light suggests there are major problems: for example, if a major component of the
project is behind target it could significantly affect the progress of the project as a
whole.
Traffic light control can also be applied to cost and quality aspects of a project as well as time.
Equally, traffic light control could be applied to the three elements of time, cost and quality
together. If a project is on course to substantially meet its objectives in all three elements, it will
be indicated by a green traffic light. If two out of the three are likely to be substantially met, the
traffic light will be yellow, but if less than two objectives are substantially met, the traffic light
will be red.
Control charts
Several different types of chart may be used to display project progress. The Gantt chart is
inherently suited to use as a control chart, displaying planned and actual usage of resources, as is,
to some extent, the resource histogram. A 'project schedule control chart' displays overall progress
against plan. An example is shown below.
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This chart shows that after a good start, by the end of period 3, the project had fallen behind by
almost two days. Efforts were obviously made to recover the lost time, because the latest report,
at the end of period 8, shows the project only about half a day behind.
Milestones
Milestones should be definite, easily identifiable events that all stakeholders can understand.
Monitoring progress towards key milestones can be done on a control chart of the type described
above, or on a milestone slip chart such as that shown below (Figure 15.2). This chart compares
planned and actual progress towards project milestones. Planned progress is shown on the X- axis
and actual progress on the Y-axis. Where actual progress is slower than planned progress slippage
has occurred.
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On the chart above milestones are indicated by a triangle on the diagonal planned progress line.
The vertical lines that meet milestones 1 and 2 are straightshowing that these milestones were
achieved on time.
At milestone 3 some slippage has occurred. The chart shows that no further slippage is expected as
the progress line for milestone 4 is the same distance to the right as occurred at milestone 3.
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Models based on the extent to which the project has achieved or failed to achieve its
desired outcomes
Models that compare the project against generally accepted standards for success and
failure for a project
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Profitability/ROI/market potential
Cost growth
review
Schedule delays
market situations, which is not explicitly mentioned in Meredith and Mantells definition. Studies in
20082009 showed that over 50% of US marketing managers were considering culling projects or
project expenditure. It is not clear whether this was due to lower budgets, less cash to invest in
marketing or changes in potential rewards from projects.
Organisations rarely have formal criteria for evaluating the early termination of projects. Often, it
is easier in terms of the level of investment and the external evidence of the project to stop
marketing projects than those with tangible evidence of work completed, for example construction
projects. It is also easier to stop projects that do not have a full-time team as there are no
redundancies. Notably, staff motivation and concerns are often not included in project termination
decisions.
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129
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Review Meredith and Mantells definition of the project termination decision, and Deans criteria
for evaluating project termination. What is the chance that this project will be terminated as a
result? What does this demonstrate about project termination decisions?
As the Edinburgh tram Real World example shows, the decision to end a project is complex. This is
particularly the case in marketing projects, where the project is not just measured on the activity,
but also on the out comes that the implementation of the project achieves. Expectations of the
outcomes may well exist, but these may not be easily transferred between projects.
For example, commonly, companies will have a facility to share models of successful marketing
communications activities (ie share knowledge). This can be through manuals, handbooks, videos or
conference presentations. Some campaigns may well have achieved success in the past, but these
may not apply in the future:
More sophisticated organisations will use decision support systems to decide on project
termination. This is similar to the initial project choice review, considering a range of projects on a
predetermined range of factors. Managers should specify thresholds to determine which projects
should face more specific review.
Some projects die even though there is no formal decision to stop the project, usually because
work is no longer being undertaken.
Project progress has slowed down so much that the project is no longer active. Sometimes, this is
due to the members of the project team moving on to more interesting topics, or even the
project manager moving to other work
The project is no longer achieving the level of resourcing (people and budget) required enabling
progress. This could be the result of the project no longer being considered a high priority, because
of company budgetary constraints, or even the project champion no longer getting top-level
management support.
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Projects irrespective of whether they are culled prematurely or finish along their expected course
can be terminated:
In many cases, the project managers final responsibility is to complete the project review. The
project review is to detail the lessons learnt and the outcomes of the project. However, without
full budgeting and scheduling of this activity, it may not happen. Often, organisations forget the
value of learning from the project experience, despite increasing commitment to ideas of learning
from success or defining themselves as learning organisations.
Project termination decisions consider many aspects that are part of the project process. In minor
projects, many of these will be irrelevant. In others, they will be key factors for future project
success. Key termination tasks include:
Personnel issues, which will differ depending on the type of project organisation. In project
team organisation, some team members will need help in finding new jobs and in
disengaging from the project and project issues. This can also apply to external parties
the loss of a major advertising account can impact on personnel who have been heavily
involved in projects for that customer.
Accounting and financial matters need to be closed. The project budget and expenditure
need to be audited or verified and signed-off. Any balances (positive or negative) need to
be addressed.
Processes will need to be clearly specified and operationalised. For example, compliance
issues will need to be clearly specified with appropriate training briefs for their
implementation in a new financial product. This may require specification for all new
procedures.
Information systems are closely related to other processes. However, data protection issues
may require more attention to personal details, and examination of personal data into
internal systems.
Marketing activities, both internal and external, should be verified as in alignment with the
project outcomes
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Schedule
Cost
Production
Sales
Finance
engineering
Product design
Three
10,900
Complexity
Good market
Breakeven
weeks late
under
considered
performance
unlikely below
budget
marginally
anticipated
acceptable
Packaging
On time
2,700
Satisfactory
month
Satisfactory
over
Considered
expensive
budget
Service
requirements
Six weeks
4,900
late
over
specification
Satisfactory
Over-complex
Satisfactory
budget
A more complex type of outcome matrix can be used to analyse performance against two
interacting criteria. This is the very common two-axis type of matrix that you are probably already
familiar with through ideas such as Ansoffs product/market matrix. An example of an outcome
matrix would be one that analysed technical aspects of a project deliverable in terms of quality of
design and quality of execution.
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The post-completion audit should involve input from the project team. A simple questionnaire
could be developed for all team members to complete, and a reason ably informal meeting held to
obtain feedback, on what went well (and why), and what didn't (and why).
This information should be formalised in a report. The post-completion audit report should contain
the following:
(a)
A summary should be provided, emphasising any areas where the structures and tools used
to manage the project have been found to be unsatisfactory.
(b)
A review of the end result of the project should be provided, and compared with the
results expected. Reasons for any significant discrepancies between the two should be
provided, preferably with suggestions of how any future projects could prevent these
problems recurring.
(c)
A cost-benefit review should be included, comparing the forecast costs and benefits
identified at the time of the feasibility study with actual costs and benefits.
(d)
Recommendations should be made as to any steps which should be taken to improve the
project management procedures used.
Lessons learnt that relate to the way the project was managed should contribute to the smooth
running of future projects.
A starting point for any new project should be a review of the documentation of any similar
projects undertaken in the past.
Benefits realisation
It is obviously important that the benefits expected from the completion of a project are
actually enjoyed. Benefits realisation is concerned with the planning and management required
to realise expected benefits. It also covers any required organisational transition processes.
The UK Office of Government Commerce has identified a
realisation. This is most relevant to projects aimed at process improvement and changing the
organisation's way of doing things.
Stage 1
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Stage 2
Stage 3
Monitoring benefits
There should be regular monitoring of benefits realisation. It must be accepted that
some projects will only be beneficial in enabling other projects to be successful.
Stage 4
Transition management
Projects are likely to bring change and this must be managed in a proper
way.
Effective communications will be required as will the deployment of good people skills
Stage 5
Stage 6
The Project Success Report can be an important way of showing stakeholders that the project has
achieved its outcomes, or identifying the reasons for failure. This is critical for the project
managers future career.
The Project History focuses on lessons learned for future projects, rather than on the merits of
the project. This report is sometimes called a project history. This history will examine the
following to determine what worked and what did not, and when and why problems occurred.
It will address:
Project performance the outcomes, successes, failures and challenges.
Administrative performance reports and reporting, communications and meetings, review
procedures, scoping and change procedures, financial management.
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Project organisation how this changed throughout the project, and how this helped or hindered
the project.
Project teams how these performed, recommendations for future teams.
Project management scoping, plans, methodologies, budgets, schedules, risk management etc.
Table 15.3
Project review
Recommendations
Project performance
Admin performance
Project organisation
Project teams
Project management
Often, these reviews will be presented in a meeting or presentation. Simply, this basic finding can
be summarised in a presentation, and Table 15.3 will help identify these key issues.
More formal project audits are often undertaken for major projects, and especially those in the
public sector.
Time, eg the extent to which the project is meeting the project schedule
Corporate factors, eg the extent to which corporate goals or standards are being met
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The customer perspective, customer satisfaction, economic value added. (Notice the
difference between earned value analysis and economic value added. The commonality of
the acronyms can cause confusion.)
The project or other internal business perspective, eg satisfaction indices, fit with
corporate objectives
This information can be presented in different ways. Some organisations produce a simple one-page
sheet, which:
Identifies areas that need attention (ie are over budget, late, possible risks on the
horizon etc)
The temporary nature of projects means that tracking an d monitoring systems must be accessible,
easy to use and current. As a temporary initiative, some or all aspects of the project tracking may
not fit well within the existing information systems. Further, often only the larger projects have
staff with responsibilities, for example information systems or finance. Therefore, the tracking data
should be, wherever possible, gathered as part of the normal routine of the project.
Another general rule is that the reporting should be kept brief. Therefore, an updated report
should be only a page or two for most projects.
Often, organisations do not require these reports despite their contribution to project management
knowledge and future projects. Often, other priorities overtake this, or the project manager has
moved to other projects or has a wish to move on. Further, on longer projects, there is much
documentation, but often the reasons for changes or problems are not noted.
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manager who was responsible for the project within each of their libraries .
Head teachers, English teachers, and in some cases school librarians, were involved depending
on the responsibility within each school. In the larger libraries the responsibility would then be
passed down to the childrens librarian and in the smaller libraries the responsibility to
organise and deliver the class visits would remain with the library manager.
Support staff were used to process the joining forms so that each child would become a
member of the library. This enabled them to borrow a book during their class visit. Staffing
number s needed to be adequate to support the visit while also maintaining a service to the
public.
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Time Scales
The project started in January and had to be included in all of t he library action plans by
April. This meant it would then b e part of the core service for the remainder of the year. This
would also be when all of the libraries would have to meet their targets. These class visits
have since been incorporated into library action plans each year as part of the standard
service.
Communication
The original idea was communicated to library managers through a joint area managers
meeting to discuss services to children and how they could be improved.
E-mails kept the Service Development Manager (SDM) in touch with library managers. Each
manager had a meeting with the SDM to further discuss the need for essential training and
staff responsibilities. Operational issues also needed to be discussed such as: staffing numbers
required for a class visit; concerns about proof of identification and joining children to the
library; carrying out the visits while the library was open to the general public and possibilities
and problems if children borrowed books during the visit.
The SDM and the area co-ordinators were informed of progress during the monthly area
managers meetings and by the quarterly library action plan updates. This helped to ensure
that targets were being met, the project was on course and to highlight any problems.
Key tasks (Stages 3 and 4)
SDM informs library managers of project and aims.
Project is included in each library action plan with targets set for each library to achieve.
Schools are consulted by the Childrens SDM and key contacts passed to library managers.
Library staff were informed during weekly staff meetings.
Meetings are held with library managers to discuss training and operational issues. Feedback
from staff was discussed.
Guidance notes on how to deliver class visits were drawn up by the Childrens SDM and a team
of childrens librarians and e-mailed out to library managers and childrens librarians.
Library managers/childrens librarians contacted schools in their catchment areas to arrange
meetings with teachers/school librarians to discuss plans for the class visits, age of children,
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numbers of children, mutually convenient dates, length of vi sit, joining procedures. The
programme and content to be included in the visit for each age group was also agreed.
Class visits were planned by managers/childrens librarians.
Adequate staffing was arranged and roles communicated to staff.
Class visits were rolled out to schools.
Follow-up calls and letters to teachers after the visits were used to assess feedback.
Evaluation (Stage 5)
Evaluation was sought formally within libraries through monthly management meetings and
through the library action plans quarterly updates. Performance targets would also be
improved through successful visits.
There was no formal evaluation plan recommended to libraries, however, each library would
have their own way of gaining this information. Library managers and librarians liaised closely
with teachers and other library staff involved before and after each visit to find out what went
well and what didnt work so well that could be changed next time. Library staff that had
been on duty during the visit were also asked to give feedback as to how they coped with
issuing books to large numbers of children, problems with library cards and serving the public
during the visits, etc.
Reflection
Key skills needed to develop the project:
Good communication with people of all ages, written and oral
Good ICT skills
Ability to work in a team
Ability to use initiative
Project management skills
Time management skills
Self-motivation and the ability to motivate a team
A set of guidelines were written and sent out electronically to managers to enable them to
plan and devise a series of class visits appropriate to the age range of each class visit.
Although the guide lines were well thought out it would have been useful to have been
supported by a childrens librarian for the first class visit or to have been able to observe how
they delivered a session. Instead confidence has grown with experience.
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Problems encountered:
Staff were extremely unhappy having class visits while the library was open to the public. The
previous librarian had taken some class visits but only while the library was closed. This
project reflected a belief that a change in culture was necessary to show the children how a
library operates and enhance their perspective of a library as part of the community. It was
also thought to be good for the public to see children using the library, further evidence that
the library service has changed.
Difficulty contacting teachers who are either teaching or in meetings. Librarians needed to
find out the best times to contact or ask them to contact the library manager. This was time
consuming.
Where more than one class visit was arranged on one day there could be problems if the first
class was late. This would then mean that visits would have to be cut short or would overrun
thus causing problems for the next class, or problems with library staff not being able to have
their breaks.
Some library users complained of the noise generated by the class visits or of having to wait to
be served. Meeting all user needs at such times proved challenging.
Some schools did not cancel the visit if they were unable to get the children to the library.
This was a particular problem when a series of visits had been planned for one school and
books became overdue because parents were told by the school that it didnt matter. The
library was unable to contact parents as they did not have a list of the names.
Library books getting mixed up with books at the school. Pupils and teachers failed to
differentiate between ownership of these items. Some schools insisted that they needed to
bring two classes at once due to staff/ time but this has been too much for the library to cope
with while also serving the public with the resources available.
Teachers not getting joining forms to the library well in advance of the visit to enable library
cards to be processed for the children. Library staff levels were not enough to cope with class
visits, serve the public and process large numbers of joining forms all at the same time.
The project experience has informed managers/librarians what works and what creates
problems. It identified the numbers of staff needed to ensure a successful visit. It also
identified t he need to communicate the important factors to teachers before the
visit so they in turn can inform parents.
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The project goal has been achieved and class visits are now included in all library plans each
year.
Conclusion and analysis This is an interesting example of a project that involved policy that
evolved as a consequence of external environment factors. The public library needed to
improve childrens use of their local libraries which had been identified as weak through
monitoring of national standards and statistics.
There is a sense of a top-down approach as this was imposed on the libraries. However, the
dispersed project leadership ensured that managers were involved in the planning and
developing stages so that local issues could be adapted to meet the project goal.
Communication with the schools seemed to present real problems as did the challenge of
trying to meet the very different needs of diverse user groups.
Overall, however, it is interesting to read about a project that has become part of standard
service delivery.
(The Higher Education Academy, 2012. Contains information for educational purposes under an
open copyright policy)
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