EM636 - PROJECT MANAGEMENT

Lecture 1: Project Management Fundamentals I Agenda Projects, Programs, Portfolios Project Phases Project Lifecycles Gate Review Process Lecture 1 is based on the following readings: PMBOK pgs 1-22 Parts of Kerzner, Chapters 1 and 2

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Project Management Institute www.pmi.org

Internationally recognized professional group dedicated to the advancement and promotion of the project management profession. 250,000 members worldwide in over 90 countries The only Project Management organization to offer the globally recognized professional certification (PMP) in project management Project Management Body of Knowledge (PMBOK) has been established as an ANSI STANDARD for Project Management, throughout the world.

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What is a Standard?
A recommended uniform approach, usually established by a trade organization or professional society Differs from regulations Examples of standards: (non-mandatory) Clothing sizes Web languages Internal financial reporting standards (other financial standards are regulations now, legally mandated like Sarbanes-Oxley) Regulations: (mandatory) FDA labels Vehicle safety Electrical codes USDA codes
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Guide to the Project Management Body of Knowledge (PMBOK)

ANSI Standard # PMI 99-001-2008 Not mandatory, but a recommended uniform approach to project management

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What is a Project? A project is a temporary endeavor undertaken to create a unique product, service or result. Temporary means there is a defined beginning and end. Unique means that no 2 projects are exactly the same. Even if they are producing the same product, they may have different people involved, different time scales, different budgets. Because of the unique product they produce, they have a specific objective to be accomplished within certain specifications.

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What is an Operation? Operations differ from Projects in that Operations are repetitive, ongoing. Example: Creating an easy-pass lane at the toll booth is a project. The person who collects the tolls every day is performing an operation.

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Programs and Portfolios A Program is a set of related projects group together so they can be managed in a coordinated way. An IT department may have an Infrastructure Program, with several projects such as upgrading hardware and software, providing standards for IT, providing WiFi to conference rooms.

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Programs and Portfolios Portfolio management is selecting out of a set of projects and programs, the ones that support the companys overall strategic objectives. A Portfolio manager may decide that the company no longer wants to invest in gaming technology and stick with only corporate applications. Project management helps to answer the question are we doing our projects right? Portfolio management helps to answer the question are we doing the right projects?
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What is a Project?
To recap: A project is a specific undertaking which: Is unique, a problem to be solved. Has specific objectives and specifications. Has defined start and end dates Must be accomplished within a limited budget and resources

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How do Projects Arise?

Market need
Example: hybrid cars to address greening the environment

Organizational need
Example: upgrade all servers to improve the efficiency of the organization

Technological advance
Example: manufacture USB drive with higher capacity

Legal requirement
Example: re-engineer security procedures to adhere to Patriot Act

Customer request
Example: add an additional room to a renovation at customers request

Social need
Example: project to develop low-income housing
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Project Management Maturity

Although Project Management is widely accepted in todays environments, there are still companies and organizations that are fairly resistant to implementing a project management methodology. Companies can perform self-assessment, or have an independent organization perform an assessment as to the organizational maturity level of their project management sophistication. Kerzner uses the levels described on the following slide. PMI has something called OPM3 which is really the new standard for this. There is a great video on the PMI website describing this. I encourage you to view it at:
http://www.pmi.org/Movies/OPM3-Whats_New_Webinar/OPM3_Second_EditionUnderstanding_the_Changes_and_Opportunities_Atlanta.html

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Project Management Maturity - Kerzner

1. Embryonic Level: A need for PM is recognized in the organization. Usually first occurs at the working levels. 2. Executive Acceptance Level: Buy-in from executive management occurs 3. Line Management Acceptance Level: Buy-in from the functional managers occurs 4. Growth Level: Organization has committed to PM methodology, and provides resources necessary for tool development for supporting infrastructure 5. Maturity Level: The PM methodology is standardized, training is provided, opportunities for improvement are recognized and implemented Note: These are NOT project phases, these are just descriptors for an organizations project management sophistication

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Project Management

An alternate view (next slide), is a Project Management Maturity Model, which assesses the level of project management expertise within an organization. This is similar to the Carnegie Mellon Software Engineering Institute (SEI) Capability Maturity Model which assesses the level of software development maturity in an organization. Note that the levels proceed from ad-hoc processes thru progressively increasing levels of formality, culminating in the collection of metrics to measure and improve processes.

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Project Management Maturity Model

Level 5
Continuous process improvements are identified, prioritized and undertaken.

At which level is your organization?

Managed

Optimized

Level 4

Metrics for process quality are collected and used to analyze and control the processes and product.

Level 3

Defined

Processes for managing the project are documented, standardized and used throughout the organization.

Level 2

Repeatable

Basic project management practices are in place. It is possible to learn from similar past activities.

Level 1

Initial

The project management process is ad hoc and chaotic. Little is defined or documented consistently throughout the organization.

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Project Management Maturity Model

All 3 of these assessments (OPM3, Kerzner, PMM) are all doing the same thing, using slightly different terminology, to determine the level of maturity an organization has with respect to project management. By knowing where your organization is, you can take steps to improve.

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Project Management Office (PMO)

A PMO is a centralized organization that supports projects by providing, among other things: Standards Templates Processes Training Project Managers

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Project Phases What is a project phase?

A collection of logically related project activities, usually culminating in the completion of a major deliverable. A deliverable is a tangible result. If my project is 2010 vacation the planning phase might include such activities as determining where to go, making hotel reservations, booking transportation, buying clothes, etc. Deliverables might be the hotel reservation confirmation airline e-ticket set of vacation apparel
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Project Lifecycle What is a project lifecycle?

A collection of generally sequential project phases whose name and number are determined by the control needs of the organization. The lifecycle is the collection of phases taking us from the beginning of the project to the end. So for the vacation 2010 project, the lifecycle would include all the planning, the execution (taking the vacation) and then closing out the vacation project by paying all the bills, perhaps organizing and printing photos.
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Generic Project Lifecycles

The next slide shows us a generic project lifecycle. At the beginning of a project lesser costs are expended, as few resources are used. This builds up towards the middle, and peaks during implementation, and then decreases towards project end. Kerzner Table 2-6, pg 73, shows different terminology for phases in various industries. We will just use the very generic C-D-E-F terminology: Concept, Development, Execution, Finish.

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Generic Project Lifecycle

Concept Phase: High level definition of goals, objectives, constraints, and project organization, with evaluation of approaches, risks, schedules, and costs.

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Generic Project Lifecycle

Development (or detailed planning) Phase: Detailed development of project plan defining specific work to be done, approach to be used, resources needed, baseline schedule, costs, quality. Plan how resources will be brought on and rolled off, how communications will take place, how procurement will be managed, how risk will be managed. Establishes the baseline against which project performance will be measured. .
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Generic Project Lifecycle

Execution (Implementation) Phase The actual doing of the work, carrying out the activities laid out in the Planning Phase. Producing the product of the project.

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Generic Project Lifecycle

Finish (Termination) Phase Completion of work and objectives. Delivery of product to customer.

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Characteristics Of A Project Life Cycle

5%

20%

60%
Implementation Execution

15%
Closeout Finish

Initiation Planning Concept Development

(Adapted from PMBOK, Figure 2-1)

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Characteristics Of A Project Life Cycle

Cumulative Expenditures Over Lifecycle
100%

0%

PROGRESS

LIFE CYCLE
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Characteristics Of A Project Life Cycle

Note how these 2 characteristics vary over the life of a project. Think about why they vary in this way.

High
Ability to Influence product and cost

Low

Cost of change and correction

Life Cycle of Project (Time)

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Characteristics Of A Project Life Cycle

Note how these 2 characteristics vary over the life of a project. Think about why they vary in this way.

High

Uncertainty of Success

Low

Amount at Stake

Life Cycle of Project (Time)

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Some Project Lifecycle Examples

The next few slides exhibit some other lifecycles which can be used for product development, depending on the circumstances.

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Modified Waterfall LifeCycle

In a true waterfall lifecycle, as opposed to the modified there would be no overlap between phases each phase would have to complete before the next could begin.

Definition Analysis Design

Implementation Installation Operation

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Incremental LifeCycle
This lifecycle would be used when a product is very modular, so that pieces can be developed separately. All the requirements for the product would be established up front, but then pieces can be developed concurrently.

Concept Architecture Design Requirements

Design Implement Design Implement Design Implement Install, Operate, and Maintain

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Evolutionary LifeCycle
This lifecycle model will get product into the hands of the customer quickly so that feedback can be obtained. Think of software beta releases.

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Deciding on a Lifecycle
This table provides some very broad guidelines for which lifecycle to use Depending on the degree to which requirements and architecture are defined, whether the system can be separated into modular parts, the level of risk in the project, and the size and experience of the project team.

Req Waterfall Incremental Evolutionary

K = Known U = Unknown
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Arch
K K U

Sys
I D D

Risk
Low Low High

Size
S to M M to L M to L

Team
New New Exp

K K K

D = Divisible I = Indivisible

L = Large S = Small
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Project vs Product Lifecycle

The next slide provides a pictorial view of the difference between a project lifecycle and a product lifecycle. Think of it as the project is what you, the PM, manage. Once the project is out of your hands and into the hands of the customer, it becomes part of the overall product lifecycle. If you are a car manufacturer, the project could be to build Car X, but the product that is Car X will live on in the customers hands. If you, as PM, cut corners, and compromised on quality, your organization will end up later paying out large sums in warrantee costs. So decisions that the PM makes during the project must include the effects on the overall product lifecycle.

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Project Versus Product Life Cycle

Product Life Cycle
Requirements C D E F C D E F C D E F Design Construction C D E F Operate

Implementation

Key C Concept Phase D Development Phase E Execution Phase F Finish Phase

Project Life Cycles

A product life cycle may contain one or more projects, each of which must go through the full project life cycle
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Phase Gates What is a Phase Gate? A structured decision point at the end of a phase to determine whether the phase was successfully completed, and whether the project should continue to the next phase. Also known as kill points, go/no-go, checkpoints, quality gates, etc.

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Phase Gates - Gatekeepers What is a gatekeeper?

An individual (sponsor) or group of individuals assigned by senior management who are: Empowered to support the structured process (including change management) Authorized to evaluate performance and make decisions Willing to provide the team with necessary technical and business information

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Phase Gates - Gatekeepers What does a Gatekeeper do?

Determines whether to proceed to next phase with the original objectives

Determines whether to proceed to the next phase with revised objectives

Requests additional information before making a final decision

May terminate the project

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Phase Gates Always a good thing?

Sometimes Gate Review meetings do not work. The reasons for this are not because they are bad, but because there are failures in planning them. Failures such as:

Assigning gatekeepers and not empowering them to make decisions

Assigning gatekeepers who are afraid to terminate a Failure to provide the team with information critical to gate

project

reviews Allowing the team to focus more on the gates than on the phases I.e. what do we need to do to pass the gate rather then how to we best meet the project objectives?

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Summary
Projects are temporary and unique, and are different from programs, operations, and portfolios. Project lifecycles are comprised of phases, which are collections of related activities, usually culminating in a deliverable. Phase gates are focused reviews conducted at the end of a phase to ensure the project has met the exit criteria for that phase and the entrance criteria for the next.

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Readings for next Lecture

PMBOK pgs 23-65 Optional: Kerzner Chapter 3

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