LDP 604 – Part I

PART I - INTRODUCTION

Introduction to Project Management

 Characteristics of a Project
 Definition of a Project
 Benefits of Project Management
 Challenges of Project Management
 Successful Project Management
 Unsuccessful Project management
 The Project Manager’s role
 The Line (Functional) Managers role
 The Functional Employee’s role
 The Project Life Cycle

Background
 History/Evolution
 Systems, Programs and Projects – a definition
 Differences between Process and Project Management
 Project Management is industry independent – Project managers are not
 PM as a strategic strength
 The Project Management institute (PMI) and PMBOK

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INTRODUCTION TO PROJECT MANAGEMENT

Characteristics of a Project:
 ‘…a temporary endeavor undertaken to produce a unique product, service or result’
(PMI)
 ‘A project is a problem scheduled for solution’ (Dr. J. M. Juan)
 ‘ a problem with a required solution for a desired product, service or result’
 A project
o Has a certain objective
o Has certain specs
o Has a budget
o Consumes resources – human and non-human
o Is multi-functional

P (Performance), C (Cost), T (Time), S (Scope)

A project should have a definite starting and ending point (time), a budget (cost), a clearly
defined scope of work and specific performance requirements 1.
 Time – Each project has a beginning and an end
o The date may be fuzzy as the idea evolves into a project. The end however must be
clearly defined so that all parties agree on what constitutes completion of the
project.
 A unique result (scope) – The outcome could be tangible (a building, software project) or
intangible (HR guidelines)
 Performance – the end result meets the customer’s expectations, as per pre-determined
measures
 Cost – within budget

Definition of a Project:
 ‘Project Management is application of knowledge, skills, tools and techniques to project
activities to achieve project requirements. Project management is accomplished through the
application and integration of the project management processes of initiating, planning,
executing, monitoring & controlling and closing’ – Project Management Book of Knowledge
(PMBOK)
o The five process groups as identified in the PMBOK Guide
 Project Initiation
 Selection of the best project given resource limits
 Recognizing the benefits of the project
 Preparation of the documents to sanction the project
 Assigning of the project manager
 Project Planning
1
Fundamentals of Project Management – Lewis, Page 2

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 Definition of the work requirements

 Definition of the quality and quantity of work
 Definition of the resources needed
 Scheduling the activities
 Evaluation of the various risks
 Project Execution
 Negotiating for the project team members
 Directing and managing the work
 Working with the team members to help them improve
 Project Monitoring and Control
 Tracking progress
 Comparing actual outcomes to predicted outcome
 Analyzing variances and impacts
 Making adjustments
 Project Closure
 Verifying that all of the work has been accomplished
 Contractual closure of the contract
 Financial closure of the charge numbers
 Administrative closure of the paperwork

 ‘Project Management is the planning, organizing, directing and controlling of company

resources for a relatively short-term objective that has been established to complete specific
goals and objectives. Furthermore, project management utilizes the systems approach to
management by having a functional personnel (the vertical hierarchy) assigned to a specific
project (the horizontal hierarchy)’ – Kerzner

Project Management Classical Management

Planning Planning
Organizing Organizing
Controlling Staffing
Directing Controlling
Directing

Benefits of Project Management

- A project assigns activities to functions rather than to people
- Minimizes need for continuous reporting
- Identifies time limits for scheduling
- Identifies a methodology for trade off analysis
- Measures accomplishment against plan
- Identifies problems early so that corrective action can follow

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Challenges of Project Management

- Project complexity
- Customer’s special requirements and scope changes
- Organizational restructuring
- Project risks
- Changes in technology
- Forward planning and pricing
- Customer relations

Successful Project Management

Primary Factors
 Within time
 Within cost
 At the desired performance or specification level
 Within scope
 Accepted by the customer
Secondary Factors
- Utilizing the assigned resources effectively and efficiently
- With minimum or mutually agreed upon scope changes
- Without disturbing the main work flow of the organization
- Without changing the corporate culture
- When the PM has a good working relationship with the line manager(s) who assign
resources
- When the functional employees can report vertically to line managers and horizontally
to project managers
- Follow-on work from the customer
- Without violating safety requirements
- Maintaining regulatory agency relations

Failed Project Management

Failure is simply when the results are not what were expected, even though the original
expectations may or may not have been reasonable
 Planning failure - the difference between what was planned and what was
 Actual Failure – the difference between what was achievable and what was actually
accomplished
 Perceived failure – the net sum of actual failure and planning failure

The Project Manager’s role

To integrate the activities necessary to develop, execute and make changes to the plan
His major responsibility is planning. What must he do?
- Define tasks
- Define resource requirements

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- Define mile-stones
- Identify the basis for performance measurement

The Line (Functional) Managers role

- To define how and where the task will be done
- To provide sufficient resources to accomplish the objective within the parameters
- To be responsible for the deliverable

The Functional Employee’s role

- Do the work within the constraints and time allocated
- Inform both the project/line manager of the project’s status
- Be part of the team, share information

The Executives role

- Project planning and objective setting
- Conflict resolution
- Priority setting
- Project sponsor

HISTORY/EVOLUTION OF PROJECT MANAGEMENT

PM is not new: Even the pyramids of Egypt utilized informal project management to coordinate
and plan the construction.

“If one of you decides to build a tower, will he not first sit down and calculate the outlay
to see if he has enough money to complete the project? He will do that for fear of laying
the foundation and then not being able to complete the work.’
Luke 14: 28 - 29
But only in the 20th Century did the title and discipline emerge.

1940’s – ‘Over the fence’ management: each manager performs his work and throws the ball
over the fence in the hope that someone will catch it.
 Line manager assumes no responsibility for the project once the ball is out of his hands
 Customer has no single reference point on the project
Post WWII – ‘Over the fence’ cannot deal with major cold war defense programs: aerospace
(bombers), naval (ships and submarines). Govt. pushed for a single point of contact – a PM –
that had total accountability for all project phases. Govt. also established life-cycle planning,
control models and appointed PM auditors to monitor Govt. spending. PM evolves slowly but is
restricted to aerospace, defense and construction.

1960 – 65 – Executives began searching for new management techniques and organizational
structures that could be quickly adapted to a changing environment particularly if:
 The jobs are complex

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 There are dynamic environmental considerations

 The constraints are tight
 There are several activities to be integrated
 There are several functional boundaries to be crossed
The business environment was rapidly changing at around this time, with several new
developments taking place particularly on a global basis
o More complex products in the automobile industry, electronics, information and
communications technology (ICT) – Cars, appliances, computers, telephones
o The emerging Asian markets and stiff competition from Japan, Korea etc.
o A more demanding, discerning customer who was assuming his position as ‘King’

20th Century - Companies began to realize that implementing project management was a
necessity, not a choice.

21st century - Today’s executives are facing and will continue to face increasingly complex
challenges during the next decade.

What are some of the pressures that executives – particularly in profit making organizations –
face today?
 High escalation factors for essential resources (manpower and raw materials),
compounded by increased union demands
 Pressure from shareholders
 Harsh financial cycles – inflation, recession, lack of borrowing power
 Stiff competition
 Consumer expectations
 Rapid changes in Information and Communications Technology (ICT)

These challenges have always existed, but not to the degree that they are prevalent today.
How did executives deal with these challenges before?
 Embarked on cost-reduction programs e.g. early retirement, layoffs
The problem with this is that at some point, the balance between the necessary levels of
manpower and required productivity becomes tricky, especially in the face of change and
competition.
Most executives agree that the solution to a majority of corporate problems involves obtaining
better control and use of existing corporate resources – looking internally rather than externally
for the solution. Project Management is one of the techniques used to achieve this internal
solution.

Systems, Programs and Projects – a definition

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System
- A system is ‘a group of elements, either human or nonhuman, that is organized and
arranged in such a way that the elements can act as a whole toward achieving some
common goal or objective’
- ‘Closed system’ – business firm is completely isolated from the environmental system
- ‘Open system’ – business firm reacts with the environment
- ‘Extended system’ – business system is significantly dependent on other systems
A system exists on a continuous bases

Program – a sub-system with a long time phase

Project – an effort with a short time phase

Systems thinking
 The systems approach may be defined as a logical and disciplined process of problem
solving. The word process indicates an active ongoing system that is fed by input from its
parts.

The systems approach to problem-solving has phases of development:

 Translation – Terminology, problem objective, and criteria and constraints are defined
and accepted by all participants
 Analysis – All possible approaches to or alternatives to the solution of the problem are
stated
 Trade-off - Selection criteria and constraints are applied to the alternatives to meet the
objective
 Synthesis - The best solution in reaching the objective of the system is the result of the
combination of analysis and trade-off phases
Also essential are:
 Objective: The function of the system or the strategy that must be achieved
 Requirement: A partial need to satisfy the objective
 Alternative: One of the selected ways to implement and satisfy a requirement
 Selection Criteria – Performance factors used in evaluating the alternatives to select a
preferable alternative
 Constraint – An absolute factor that describes conditions that the alternatives must
meet
Systems thinking is vital for the success of a project. PM systems urgently need new ways of
strategically viewing, questioning and analyzing project needs for alternative non-technical and
technical solutions. The ability to analyze the total project, rather than the individual parts, is
essential for successful PM.

Differences between Process and Project Management

Process Project

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Repeat process or product . A way of New process or product. Done once.

doing something, repetitively
Several objectives One objective

On-going One shot - limited life

People are homogenous More heterogeneous

Well established systems in place to Systems must be created to integrate

integrate efforts efforts
Greater certainty of performance, cost, Greater uncertainty of performance, cost,
schedule schedule
Part of line organization Outside of line organization
Bastions of established practice Violates established practice

Supports status quo Upsets status quo

Project Management is industry independent – Project managers are not

 PM is industry independent and this has been a major factor in the development of
project management as a discipline.
 Project Managers are NOT industry independent. PMs must not only know how to
operate in business and project environments, they must also be well acquainted with
the focus of the project. Specifically, PMs require skills in three different areas:
1. Project Management – the pure discipline
2. Business Management – Negotiating, Finance, Customer Recruitment, Organizational
Development, Communication, Motivation
3. Technical – The PM has some technical competence

Project Management as a strategic strength

Driving forces
1. Capital projects (especially in large manufacturing companies where scheduling, budgets
are sensitive). Is a significant portion of your budget related to delivering projects? Over
20%? How would it transform your organization to be able to receive 20 – 40& more
products or services for that same amount of money because you are more efficient at
delivering projects?
2. Customer expectations
3. Competitiveness: when (a) companies realize that they can outsource cheaper than
perform the work themselves and (b) when they are no longer competitive on price or
quality, or cannot increase their market share. Would your organization be more

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competitive if it could reduce the time space between initiation and completion of
projects?
4. Executive understanding – particularly in traditional structures
5. New product development – especially those that rely heavily on R&D (Pharmaceutical,
Telecommunications):
a. Is your ability to deliver new products to the marketplace part of your
competitive situation? What if you could consistently deliver a new project faster
or cheaper than your competitor? What if you can’t?
b. New product development for pharmaceutical companies and defense
contractors is extremely expensive. Further, the products are so complex that
without strong project management, the product development efforts fail.
c. Technology requires more specialized manpower. How do you ensure that you
make the best use of this valuable yet expensive resource?
d. As technology increases, the commitment of time and money appears to be
inflexible
6. Maintaining efficiency and effectiveness – especially during periods of growth or
difficulty
7. The nature of your industry –
a. Do you work for a service based firm that bids on projects (engineering, roofing,
information services etc.)? If so, you stand to either improve your ability to win
new work or perform the work at a higher profit.
b. Growth – are you in a growth industry? Growth if fueled by projects. Those who
deliver projects faster and more cost-effectively will leave the others behind.

The above forces identify the necessity for more effective planning, scheduling and control that
was in the best interest of the company.

The Project Management institute (PMI) and PMBOK

The Project Management Institute is a professional organization for people who manage
projects. It was founded in 1969, employs 51-200 people and has a membership of over
285,000. In addition to providing a variety of member services, a major objective of PMI is to
advance project management as a profession. The fact that there is a professional association
just for PM shows that PM is not just a variant on General Management.

Kenya Institute of Project Management (KIPM ) (Utumishi Co-Op House) is a professional

project management training centre based in Nairobi Kenya. The institute delivers its' quality
services and courses through various methods including: seminars, workshops, face to face class
teaching, e-learning, and distance learning modules. Our target group includes: Individuals,
private and governmental enterprises and NGOs.

The institute aims to provide quality education, mentorship and guidance to its members,
clients, students and participants interested in quality project management.

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The KIPM College is part of the renowned Project Management Group Ltd - a training and
consultancy firm based in Nairobi Kenya. In partnership with 4CPM, and accredited
by University of Cambridge International Examinations (CIE), KIPM delivers and is the centre for
the post-graduate 'International Diploma in Project Management (IDPM) at Professional Level'
serving the Africa region.

Project Management Book Of Knowledge - The PMI has attempted to determine a minimum
body of knowledge that is needed by a project manager in order for him/her to be effective.
This is referred to the Project Management Body of Knowledge (PMBOK) and contains 5
processes together with 9 general areas of knowledge.

Project Management Methodologies

Achieving PM excellence is more likely with a repetitive process that can be used on each and
every project. This repetitive process is referred to as the project management methodology. If
possible, companies should maintain and support a single methodology for project
management. Good methodologies integrate other processes into the PM methodology such
as:
 Project Management
 Total Quality Management
 Concurrent Engineering
 Scope Change Control
 Risk Management

The Project Life Cycle

A project life cycle represents the linear progression of a project. The standard project life cycle
comprises:

Conceptualization
 The preliminary evaluation of an idea and risks
 Impact on and availability of resources
 Whether the project will be in-house or tendered out
Definition
 ‘Defining a problem determines how you will solve it’2
 The phase begins when a project and a project manager are names in a project charter
and it is completed when the project rules are approved. Approving this written
document means that all interested parties agree on the project goals, approach and
cost-schedule-quality equilibrium.

2
‘Fundamentals of Project Management’ Page 12

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Planning
 After the rules are approved, the PM begins building the project plan.
 Remember ‘the people who must do the work should help plan it!’ Inexperienced
project managers often make the mistake of planning the project for the team. The PM
should always aim to facilitate planning.
o Firm identification of the resources required
o Establishment of realistic time lines
o Cost
o and Performance parameters
o Initial preparation of documentation (if the project will be based on competitive
bidding)
Execution
 Tactics and logistics

Close-out (Gate review meetings)

 Transition to the next phase – whether operations or another product development
phase
 Formal closure of the project in the eyes of the customer
 Reviewing project successes and failures with a view to improving future projects

Product Development Life Cycle vs. Project Management Life Cycle

A product development life cycle may contain many projects!

Product Development Life Cycle

1. Requirements for the product
2. Design of the product
3. Construction/manufacturing of the product
4. Operation of the product

 PDLC is industry specific : PMLC is industry independent because project management

theory is industry independent
 The PDLC describes the work required to create the product. PMLC focuses on managing
the work
 A PDLC may contain many projects, each of which must go through the full project life
cycle.

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