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Lesson 1: Initiating a Project

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Introduction to Project Management

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Project Management Statistics

The U.S. spends $2.3 trillion$2.3 trillion on projects every year, an amount equal to one-quarter of the nation’s gross domestic product.

The world as a whole spends nearly $10 trillion$10 trillion of its $40.7 trillion gross product on projects of all kinds.

More than sixteen millionsixteen million people regard project management as their profession

*PMI, The PMI Project Management Fact Book, Second Edition, 2001

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IT Projects have a terrible track record– A 1995 Standish Group study (CHAOS) found

• only 16.2%16.2% of IT projects were successfulsuccessful • and over 31%31% were canceledcanceled before completion,

costing over $81 B in the U.S. alone

The need for IT projects keeps increasing– In 2000, there were 300,000 new IT projects,

and– In 2001, over 500,000 new IT projects were

started

Why Project Management?

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Advantages of Using Formal Project ManagementBetter control of financial, physical, and human

resources Improved customer relationsShorter development timesLower costsEnhanced product quality and increased

reliability Improved productivity Increased profitabilityBetter internal coordinationHigher worker morale

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Significant Improvement in IT Project Success

Since 1995:Time overruns significantly decreased

to 63% compared to 222%Cost overruns were down to 45%

compared to 189%78,000 U.S. projects were successful

compared to 28,00028% of IT projects succeeded

compared to 16%(2001 Standish Group Report )

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What Is a Project?

A project is a temporary endeavor undertaken to accomplish a unique purpose

Attributes of a project:– unique purpose – well-defined objective– temporary – has definite start and finish, deadlines – requires resources, hardware, software, labour – has a primary sponsor and/or customer, normally a

business area manager– involves uncertainty in terms of clear objectives, cost

and duration

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The Triple Constraint

Every project is constrained in different ways by its– Scope goals: What is the project trying to

accomplish? (Scope = all the work to be done)– Time goals: How long should it take to

complete?– Cost goals: What should it cost?

It is the project manager’s duty to balance these three often competing goals

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What is Project Management?

Project management is “the application of knowledge, skills, tools, and techniques to project activities in order to meet project requirements” (PMI*, Project Management Body of Knowledge (PMBOK Guide), 2000, p. 6)

*The Project Management Institute (PMI) is an international professional society. Their web site is www.pmi.org.

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Gathering Project Information

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Project Stakeholders

Stakeholders are the people involved in or affected by project activities

Stakeholders include:– the project sponsor and project team– support staff– customers– users– suppliers– even the opponents to the project

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Project Stakeholders

Important to identify stakeholders early in project’s initiation

Their inputs and requirements can ensure project’s success

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Questions to consider when planning a project : Question 1

Does the project have an exact result?– Define clearly what the project should produce.

and the results that signal the end of the project.– Think systematically : be clear about the inputs,

processes and output– Gather information from stakeholders, eg

sponsor and end users– Be clear about what is excluded from the

project

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Questions to consider when planning a project : Question 2

Are there industry or government standards/regulations to consider?

Non-adherence may prove costly in terms of litigation?

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Questions to consider when planning a project : Question 3

Are the deadlines reasonable? – Be aware of the project calendar : specific to

project as a whole - hours in which project can take place

– and resource calendar : specific to team members – individual working hours, vacations

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Questions to consider when planning a project : Question 4

How powerful is the sponsor?– Should have power to assign team members,

allocate funds, approve decisions on project work

– He/she is typically above the functional managers of team members working on the project

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Questions to consider when planning a project : Question 5

Does the project have a firm financial commitment ?– Ensure that there is an approved budget

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Questions to consider when planning a project : Question 6

Are there competing projects in existence?– If there are similar projects, they should be co-

ordinated by a Program manager

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Scrutinising the Project

Scrutinise the project optimistically, pessimistically and realistically. Consider the following issues:– User effect, benefits, acceptance?– Compatibility with other software?– Compatibility with other OSs?– Tested and tried by other companies?– Vendor track record and support?– Network utilisation?– Worst case scenarios?– Consider the following issues:

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Consider all Appropriate Technologies

Project technologies –– eg communications, charting tools, evaluation

tools, controls

Product technologies – – Development software, OS, routers, cabling

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Interviewing Management

Understand management vision and need How will the company benefit? Will the project support

strategic goals? Solicit a strong commitment to the project from

management Do not question their decision-making abilities, question

their vision for the project Ask questions that require specific answers Think like an executive: invent a project that creates

wealth for the company, satisfies customers and streamlines processes to achieve those goals

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The Importance of Management Commitment

Several studies cite top management commitment as one of the key factors associated with project success– Top management can help project managers:– secure adequate resources– get approval for unique project needs in a timely

manner– receive cooperation from people throughout the

organization– be better leaders through mentoring them

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Interviewing the Stakeholders

The users comprise the largest group of stakeholders. Possible strategies to gauge user needs:

– Focus groups use sample users from various departments. Focus groups need to be controlled

– Intranet site using online surveys– Delphi technique where participants and responses are

anonymous . The participants discuss the responses and reach a consensus. Can be used with intranet for speedy automation.

Study the existing system and document user responses to mock-ups of envisaged system.

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Suggestions for Better Understanding of User Input

Develop a good project selection process and insist that sponsors (they provide direction and funding) are from the user organization

Have users on the project team in important rolesHave regular meetingsDeliver something to users and sponsors on a

regular basisKeep users and developers in close proximity

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Suggestions for Limiting Changing Requirements

Develop a good project selection process and insist that sponsors (they provide direction and funding) are from the user organization

Develop and follow a requirements management process with definite procedures for identifying requirements

Use approaches like prototyping and JAD to get more user involvement

Put requirements in writing and keep them current Provide adequate testing and conduct testing throughout the project

life cycle Review changes from a systems perspective Emphasize completion dates to help focus on what’s most important Allocate resources specifically for handling change

requests/enhancements

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Identifying Project Needs

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Difficulties in Managing IT projects:

IT changes rapidlyKeeping teams, budget and goals

focusedDemands by stakeholdersFlux in team member’s commitment

to their own career

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Why do Projects Fail?

Other projects take precedenceMembers lose sight of project’s purposePoor leadership – lack of delegationPoor vision of the intangible, and the actions

required to get thereLack user involvementLack of executive management supportPoorly defined statement of requirementsPoor communication skills

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Always Create Goals

Goals should be:– clear– well-defined– reasonable– founded on preliminary research

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Project Management Areas and Tools

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Project Charter

A document that formally recognizes the existence of a project

Provides direction on the project’s objectives and management.

It formally authorizes the project It clearly defines the project, its attributes and end results Key project stakeholders It assigns authority to the project manager on behalf of

the project sponsor Makes project manager accountable for the project Do not confuse the project charter with the project plan,

which follows later

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Project Charter Sections

Introductory information– Project name– Project sponsor and contact information– Project manager and contact information– Team members names

Purpose of project Business case for project(Why is the project necessary?) High-level results and deliverables of the project (objectives) General statement about how the team will approach the work Basic timeline Project resources, budget and vendors Sign-off and comment sections

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Finding an End Date

Flexible end dates increase time and cost and decreases morale

Firm date creates a sense of responsibility towards the project and confirms that the project will end

Based on facts research and planningThe end date is determined by the duration

of each step and the manner in which the steps are sequenced

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Factors Impacting on Projected Deadlines

Business cycles, eg Christmas rushFinancial situations, eg fiscal year

endings when taxes have to be paidTimes of the year, eg team member

availability, vacations

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Project Management Areas and Tools

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Project Management Areas

Knowledge areas describe the key competencies that project managers must develop– 4 core knowledge areas lead to specific project

objectives (scope, time, cost, and quality)– 4 facilitating knowledge areas are the means through

which the project objectives are achieved (human resources, communication, risk, and procurement management

– 1 over-arching knowledge area (project integration management) affects and is affected by all of the other knowledge areas

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Project Management Framework

EnterpriseSuccess

EnterpriseSuccess

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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

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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 WBS (scope)

– Gantt charts, network diagrams, critical path analysis, (time)

– Cost estimates and earned value management (cost)

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Sample WBS for Intranet Project in Chart Form

C oncept

D esign U ser In terface

D esign Server Setup

D evelop ServerSupport In frastructure

W eb S iteD esign

D evelop Pagesand L inks

D evelopFunctionality

C ontentM igration/In tegration

Testing

W eb S iteD evelopm ent

R oll O ut Support

In tranet Pro ject

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Sample Gantt Chart

The WBS is on the left, and each task’s start and finish date are shown on the right using a calendar timescale.

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Sample Network Diagram

Each box is a project task from the WBS. Arrows show dependencies

between tasks. The bolded tasks are on the critical path. If any tasks on thecritical path take longer than planned, the whole project will slip unless something is done.

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Growth in the Project Management Profession

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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, the 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

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The Project Management Profession

A 1996 Fortune article called project management the “number one career choice”

Professional societies like the Project Management Institute (PMI) have grown tremendously

Average salaries for project managers are over $81,000

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Project Management CertificationPMI 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

PMI and other organizations are offering new certification programs

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Growth in PMP Certification, 1993-2000