Introduction to Project Management

Prof. Anil Mendhi

History of Project Management

Modern project management began with the Manhattan Project, which the U.S. military led to develop the atomic bomb In 1917 Henry Gantt developed the Gantt chart as a tool for scheduling work in job shops In 1958, US Navy developed PERT charts In the 1970s, the military began using project management software, as did the construction industry By the 1990s, virtually every industry was using some form of project management
Prof. Anil Mendhi 2

WEBSTERS DICTIONARY

A plan; scheme, an undertaking; specific task, mission, job, assignment, task, endeavor, etc. A special unit of work, research, etc. as in school proposal of something to be, a laboratory, etc. An extensive public undertaking, as in conservation, construction, etc.
Prof. Anil Mendhi 3

What Is a Project?

A project is a temporary endeavor undertaken to accomplish a unique purpose Attributes of projects Unique definable purpose. Temporary, one time activity, never to be exactly repeated. Require resources, often from various areas. Teams are formed for a purpose and disbanded after achieving the purpose. Projects cut across the organizational lines; many disciplines are involved. Should have a primary sponsor and/or customer / stake holder/s Involve uncertainty and unfamiliarity, does not fall under the routine category of activity Project is the process of working to achieve a pre-defined goal and during the process, project may pass through various Prof. the Anil Mendhi 4 phases

EXAMPLES

Pyramid of Egypt (2500 B.C. 2.3 Mn. Stone blocks weighing 2 to 70 tons each, quarried and carried over the Niles, height equivalent of 40 storey building, 13 acres of land, deviation of less than an inch in levels, stones fixed with accuracy of .04 inch!!) 100,000 laborers, 40,000 skilled masons, over 150,000 women & children to be housed & fed! Numerous other examples like Taj Mahal, Eiffel tower, international space station by NASA, anti missile system developed by India, etc. Advantix advanced photo system created by Kodak in one of their most ambitious projects ever From construction, information technology to research, projects could be conceived in all possible fields. Each project is unique in many ways.
Prof. Anil Mendhi 5

EXAMPLES contd.

AT CORPORATE LEVEL: - Restructuring - Relocation - Acquisition / Merger - New product or system development AT FAMILY / PERSONAL LEVEL: - Remodeling of a home - Wedding - Moving to another house MOST ARTISTIC ENDEAVOURS ARE PROJECTS!!
Prof. Anil Mendhi 6

TYPES OF PROJECTS

Manufacturing projects Civil engineering, construction, petrochemical, mining, infrastructure and other projects requiring external organisation Management projects Greenfield Projects for setting up new establishments Scientific Research Projects Systems Development Projects
Prof. Anil Mendhi 7

EXCEPTIONS..

Building a skyscraper is a project; but mass construction of pre-fabricated homes is a scheduled and repetitive task rather than a project. Repetitive work of accounts and audits is not a project. Exploratory mission to Mars or Moon are projects; conducted tours to tourist places are not projects.
Prof. Anil Mendhi 8

The Triple Constraint

Every project is constrained in different ways by its Scope goals: Quantity & Quality Time goals Cost goals It is the project managers duty to balance these three often competing goals
Prof. Anil Mendhi 9

The Triple Constraint of Project Management

Prof. Anil Mendhi

10

What is Project Management?

Project management is the application of knowledge, skills, tools, and techniques to project activities in order to meet or exceed stakeholder needs and expectations from a project (PMI)*,
*The Project Management Institute (PMI) is an international professional society. Their web site is www.pmi.org.
Prof. Anil Mendhi 11

CHARACTERISTICS OF PROJECTS

Project can also be described as a unique set of coordinated and inter-related activities undertaken by an organisation to meet defined objectives; that has an agreed start and finish time; is constrained by cost & resources and has specified performance requirements. Projects are unique in nature. Everything is special and 'one-off'. Designs are new and usually unproven. Every industrial or commercial project is a risk venture. The job of the manager is to identify the risks and, through his project management, contain them. The application of techniques and management practices that have been developed will depend on the size and type of project, and upon the relative priorities, which are assigned to the cost, time and performance objectives.
Prof. Anil Mendhi 12

CHARACTERISTICS OF PROJECTS

Project has a definite start and finish (Time goals and Scope goals quantity and quality and). Project consists of a well-defined and unique collection of jobs, activities, or tasks which when complete; mark the end of project. Project is constrained by cost, time & resources and has specified performance requirements. The jobs may be started or stopped independent of each other, within a overall given sequence. The jobs are ordered - i.e., they must be performed in technological order.
Prof. Anil Mendhi 13

Project Stakeholders

Stakeholders are the people involved in or affected by project activities Stakeholders include

The project sponsor or promoter, project team, equity / share holders support staff Customers / users Suppliers / Vendors / Sub-contractors Financial Institutions / lenders / bankers Govt. / Approving authorities Affected population / opponents to the project
Prof. Anil Mendhi 14

Project Management Knowledge Areas

Knowledge areas describe the key competencies that project managers must develop

Four core knowledge areas (viz. scope, time, cost, and quality) help in fixing targets / objectives. Four facilitating knowledge areas (viz. human resources, communication, risk, and procurement management) are the means through which the project objectives are achieved. One knowledge area (project integration management) affects and is affected by all of the other knowledge areas
Prof. Anil Mendhi 15

Project Management Framework

T
T

Prof. Anil Mendhi

16

Project Management Tools and Techniques

Project management tools and techniques assist project managers and their teams in various aspects of project management Some specific ones include Project Charter and Work Breakdown Structure - WBS (scope) Gantt charts, PERT charts, critical path analysis (time) Cost estimates and Earned Value Analysis (cost)
Prof. Anil Mendhi 17

Advantages of Project Management

Bosses, customers, and other stakeholders do not like surprises. Good project management (PM) provides assurance and reduces risk. PM provides the tools and environment to plan, monitor, track, and manage schedules, resources, costs, and quality. PM provides a history or metrics base for future planning as well as good documentation. Project members learn and grow by working in a crossfunctional team environment
Prof. Anil Mendhi 18

Source: Knutson, Joan, PM Network, December 1997, p. 13

PROJECTIZING THE ORGANIZATION

Today, the definition of a project is no more confined to engineering, technology and research; But has expanded to include recurring situations, one time crisis, and dealing with difficult issues.

It has been realised that the solution to majority of corporate problems involves obtaining better control and use of existing corporate resources. Project Management is one of the techniques being considered.
Project management is being used by a wide range of disciplines and corporations that had never previously considered it as a viable method of performing work Prof. Anil Mendhi 19

PROJECTIZING THE ORGANIZATION

Legal offices, hospitals, banking and other services as well as traditional manufacturing firms have become enthusiastic about the ways in which project management is improving their delivery of services or creation of new products. Some typical examples are:
Annual budgeting / auditing exercises Introduction of new systems (ISO 9000) Effecting change in structure, staffing, or style of Organization Software development & implementation Development of new product / Service Campaign for new product launch / election Prof. Anil Mendhi Organizing AGM / sales conference / event

20

PROJECTS ARE SHAPED BY THEIR ENVIRONMENT

TIME

TECHNOLOGY
CULTURAL SYSTEM SOCIAL SYSTEM POLITICAL SYSTEM REGULATORY AND LEGAL SYSTEM ECONOMIC SYSTEM ORGANISATIONAL SYSTEM.
Prof. Anil Mendhi 21

IMPACT OF ENVIRONMENT (CONTD.)

RESOURCES, BUDGETS, METHODS AND TOOLS OF PROJECT MANAGEMENT DEPEND ON ABOVE FACTORS AND CHANGE ACCORDINGLY.
Prof. Anil Mendhi 22

CURRENT PROJECT ENVIRONMENT

INCREASING GLOBAL COMPETITION RAPID TECHNOLOGICAL CHANGE RAPID PRODUCT OBSOLESCENCE RATE ORGANISATIONAL DOWNSIZING BUSINESS RE-ENGINEERING EMPOWERMENT FOCUS ON QUALITY & CONTINUOUS IMPROVEMENT INFORMATION DELUGE FASTER COMMUNICATION INTER-ORGANISATIONAL SYSTEMS
Prof. Anil Mendhi 23

IMPACT OF CURRENT PROJECT ENVIRONMENT ON ORGANIZATIONS

PROJECTS ARE GIVEN MORE IMPORTANCE BY THE MANAGEMENT FOR SURVIVAL OF THE OGANISATION INCREASING NEED FELT TO DO PROJECTS RIGHT & SUCCESSFUL THE FIRST TIME MORE LIMITATIONS ON RESOURCES AND LESSER ORGANISATIONAL SUPPORT INCREASING PRESSURE ON PROJECT MANAGEMENT TO ACHIEVE QUICK RESULTS
Prof. Anil Mendhi 24

IMPACT OF CURRENT
ENVIRONMENT ON PROJECTS

PROJECTS ARE TENDING TO GET MORE COMPLEX & LARGE TO HANDLE PROJECTS TO BE COMPLETED AHEAD OF SCHEDULE, ALWAYS. NEED MORE FLEXIBILITY IN DEFINING SCOPE, PLANNING & EXECUTION TO EXPAND PROJECT BENEFITS AND IMPACT

Prof. Anil Mendhi

25

ADOPTING PROJECT MINDSET INFORMATION SHARING

- Not just possessing

PROCESS ORIENTATION

- Not just system orientation

NON-LINEAR THINKING - As opposed to linearity

Prof. Anil Mendhi

26

PM RESPONSE TO CHANGING ENVIRONMENT

Need for a managerial approach to deal with problems and take advantage of opportunities. Modern era implies interdependency, complexity, rapid and radical changes and hence elements of uncertainty and risks. PM is different from management of simpler ongoing, repetitive, operations where the market and technology are predictable. More organic forms of organization are now required to ensure quick adaptability and rapid response to changing environment are necessary. SYSTEMS APPROACH TO MANAGEMENT IS ESSENTIAL!
Prof. Anil Mendhi 27

PROJECT EFFORTS
CONCEPT DEVELOPMENT & DEFINATION EVALUATION SCOPE SCHEDULE BUDGET RESOURCES ORGANIZATION P LA N N I N G
AUTHORIZATION

PR O PO SAL
SANCTION

DETAIL ENGINEERING
& DESIGN PROCUREMENT MANUFACTURING & CONSTRUCTION TRIALS

STAGES OF A PROJECT

Prof. Anil Mendhi

I M PLE M E NTAT I O N & COMMISSIONING DOCUMENTATION SNAG LIST & FAILURE ANALYSIS LEARNINGS
28

HAND OVER

CLOSING OPERATION & MAINTENANCE

PROJECT MANAGER

His responsibility is to plan, organize, direct and integrate work efforts of all participants to achieve the set project goals (costs, time schedules and scope goals). One person in the organization who is accountable for the project and is totally dedicated to achieving its goals. Leadership qualities are essential.
Prof. Anil Mendhi 29

DUTIES OF A PROJECT MANAGER

AS A RESOURCE MANAGER: Manage and direct project resources to achieve the project objectives. AS A PLANNING & CONTROL MANAGER: Develop the project plan and ensure that the work is completed on time, within given budget and with acceptable quality. AS A CO-ORDINATOR: Interface with higher management regarding project review, approvals and addressing project issues. The must also relate successfully to line managers and staff.
Prof. Anil Mendhi 30

What does a project manager do?

DIRECTING MOTIVATING PLANNING SUPERVISING ADMINISTERING DOING TRAINING COUNSELING

: : : : : : : :

DELEGATING : RESOLVING CONFLICT :

Project Resources Project Team Anticipate and plan The Project Work Administrative Tasks Doing some tasks directly Project Team Technical, Business, Project & Personal issues Delegate & supervise Over resources and schedules
31

Prof. Anil Mendhi

PROJECT TEAM

Project work is team work. Project work is accomplished by a group of people from different functional areas and organizations. Size and composition of the team will vary depending on the project requirements. The team may be disbanded after the project work is completed.
Prof. Anil Mendhi 32

PROJECT MANAGEMENT

PROJECT PLANNING

PROJECT IMPLEMENTATION

PROJECT CLOSURE

INVESTMENT DECISION

SCOPE DEFINITION

PROJECT SCHEDULING

PROJECT BUDGETING

IDEA GENERATION

PROJECT ENVIRONMENT

GANTT CHARTS

NETWORK TECHNIQUES PERT CPM CRITICAL CHAIN Activity based costing Cost breakdown Cash flow Earned value
33

FEASIBILITY & APPRAISAL Market Technical Financial Economic Ecological

RISK ASSESSMENT

Sensitivity Scenario Simulation Decision tree

Specifications Deliverables Time frame Organization Budgets WBS / CBS

Prof. Anil Mendhi

PROJECT MANAGEMENT

PROJECT PLANNING

PROJECT IMPLEMENTATION

PROJECT CLOSURE

PROJECT MONITORING

PROGRESS REPORTING

PROJECT CONTROL
Control actions Revised scope Revised schedule Revised budget

SCHEDULE UPDATE

COST TILL DATE

SCOPE CHANGE

PERIODIC REPORTS

AD-HOC REPORTS

ACTUAL STATUS Activity Completion % Critical path Delays Project completion %

Current status Time to complete Cost to complete Earned value

Special studies Milestone reports

Committed Incurred Balance budget

Periodicity Detailing Summary Distribution

Discrepancy report Hand over report Documentation Failure analysis Learnings

34

Prof. Anil Mendhi

PROJECT MANAGEMENT SYSTEM / ORGANIZATION

INFORMAL ORGANIZATION FORMAL ORGANIZATION TRADITIONAL PROJECT TEAM APPROACH MATRIX TYPE
Prof. Anil Mendhi 35

How Project Management (PM) Relates to Other Disciplines

Much of the knowledge needed to manage projects is unique to PM However, project managers must also have knowledge and experience in

General management The application area of the project

Project managers must focus on meeting specific project objectives

Prof. Anil Mendhi 36

Project Management and Other Disciplines

Prof. Anil Mendhi

37

PROJECT MANAGEMENT V/S GENERAL MANAGEMENT

PROJECT MANAGEMENT Long term, usually much more than one year. More strategic thinking involved. PROCESS: Has to be developed & designed new each time. Considerable uncertainty and many unknown factors New multi-disciplinary team to be created usually from of personnel from other departments. Projects are initiated to bring about change. Substantially Large

GM/MANUFACTURING Short & medium term, usually within one year. Focus on minor day-to day issues Stabilised over a period of time due to experience, minimum uncertainty. Plant & personnel already exist. Direct control over personnel. Minimal change is expected in set routine. Comparatively smaller

Prof. Anil Mendhi

38

The Project Management Profession

A 1996 Fortune article called project management the number one career choice. Other authors, like Tom Peters and Thomas Stewart, stress that projects are what add value to organizations. Professional societies like the Project Management Institute have grown tremendously.
Prof. Anil Mendhi 39

Project Management Certification

PMI provides certification as a Project Management Professional (PMP) A PMP has documented sufficient project experience, agreed to follow a code of ethics, and passed the PMP exam The number of people earning PMP certification is increasing quickly
Prof. Anil Mendhi 40

Code of Ethics

PMI developed a project management code of ethics that all PMPs must agree to abide by Conducting work in an ethical manner helps the profession earn confidence Ethics are on the web at www.pmi.org/certification/code.htm
Prof. Anil Mendhi 41

Discussion / Review Questions

Give three examples of activities that are projects and three examples of activities that are not projects What are the basic functions of a Project Manager? What qualities, qualifications and experience would you recommend for an effective Project Manager? (2000) Discuss Human Aspects of Project Management in relation to Authority, Personnel Orientation, Motivation and Team Building. (2000) How does project management differ from the management of other types of manufacturing activities? (2001) Write short note on main features and advantages of Matrix type organisation for projects. (2001)
Prof. Anil Mendhi 42

Discussion / Review Questions (contd.)

Define Project. What are the main characteristics that identify and differentiate projects? Do you think that the specialised project management techniques can be applied effectively to non-engineering areas of organizational functions? Explain your answer with suitable examples. (2002) Define Project Management. What are the main criteria for assessing success of projects? (2003) How is project management different from general management? Why do you think so many information technology projects are unsuccessful?
Prof. Anil Mendhi 43

QUESTION PAPER PATTERN

100 MARKS PAPER AND FOUR HOURS DURATION. ANY FIVE QUESTIONS FROM USUALLY SEVEN QUESTIONS. EACH QUESTION IS OF 20 MARKS QUESTION PAPER IN TWO PARTS. BOTH WILL HAVE ONE QUESTION ON THEORY (DESCRIPTIVE) 40 MARKS REST OF THE QUESTIONS WILL BE MAINLY ON NUMERICALS OR A MIX OF THEORY AND NUMERICAL USUALLY NUMERICALS ARE ON: 1. Market forecasting, 2. Project evaluation techniques (Financial appraisal / discounting techniques, etc.), 3. Probability Theory and decision tree techniques, 4. Cash Flows 5. Gantt charts, Work Flow, PERT, CPM or networking techniques,
Prof. Anil Mendhi 44