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Project Management Context(Part 3)

Bilgisayar Mühendisliği Bölümü – Bilkent Üniversitesi – Fall 2009

Dr.Çağatay ÜNDEĞER

InstructorBilkent University, Computer Engineering

Middle East Technical University, Game Technologies

&

General ManagerSimBT Inc.

e-mail : cagatay@undeger.com

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Project Management Context

• Project Stakeholders– Introduction– Who are stakeholders?

• Organizational Structures – Introduction– Functional Organization Structure– Projectized Organization Structure– Matrix Organization Structure– Project Management Office (PMO)

• Standards and Regulations– What is a standard?– What is a regulation?

• Life Cycle of a Tender– Introduction– From the view point of Employer & Tenderer– Summary

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Project Stakeholders

• A project is started because of having someone interested in– Outcome of a project,

• Which is required to satisfy their organizational needs.

• Stakeholders are;– Individuals who cause a project be initiated – Those who are most directly affected by

the project’s completion.

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Project Stakeholders

• Actively involved in the project; • Have influence over project and its results.

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Possible Stakeholders

• Customers, – Who require outcome of project,

• Sponsors, – Who support project financially,

• Project manager,• Project team members,• Project management office,• Other influencers,

– Who has influence on project due to their organizational position and power.

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Project Management Context

• Project Stakeholders– Introduction– Who are stakeholders?

• Organizational Structures – Introduction– Functional Organization Structure– Projectized Organization Structure– Matrix Organization Structure– Project Management Office (PMO)

• Standards and Regulations– What is a standard?– What is a regulation?

• Life Cycle of a Tender– Introduction– From the view point of Employer & Tenderer– Summary

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Organizational Structures

• Organizational structures can differ dramatically from one company to another.

• Organizations may or may not be project based.

• Those that are not project based;– Usually lack management systems

necessary for efficient and effective project management.

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Common Organizational Structures

• Functional Organization Stucture• Projectized Organization Stucture • Matrix Organization Stucture

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Functional Organization Stucture

• A traditional hierarchical organization (like a pyramid) with; – Top management at the peak, – Direct workers at the bottom, – And middle managers in between.

Chief Executive

Functional Manager

Staff

Staff

Functional Manager

Staff

Staff

Functional Manager

Staff

Staff

Project coordination

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Functional Organization Stucture

• Each employee has;– One clearly designated supervisor.

• Employees are grouped by their specialization such as;– Accounting, marketing, information systems,

and manufacturing.

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Functional Organization Stucture

• People within different functional areas work separately on different parts of the project.

• One group takes their part of the project, – Edits it, and

• Throws it to the next group.• In IT projects, because of weak coordination

between departments, • This structure causes more work for

everybody, • Results with a product less than what it

could be.

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Projectized Organization Stucture

• At the other extreme.• A structure where people from different

functional backgrounds work together through life time of a project.

Chief Executive

Project Manager

Staff

Staff

Project Manager

Staff

Staff

Project Manager

Staff

Staff

Project coordination

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Projectized Organization Stucture

• Designed specifically to provide necessary resources for the project work.

• In IT projects, – Because of weak coordination in project

groups, • Experienced personnel, possibly

required for multiple projects, are not effectively used among projects.

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Matrix Organization Stucture

• In the middle spectrum.• A structure that typically crosses;

– Functional design on one axis and – Some other design characteristic (e.g.

project managers) on the other axis.

Chief Executive

Functional Manager

Staff

Staff

FunctionalManager

Staff

Staff

Functional Manager

Staff

Staff

Project coordination

Manager ofProject Managers

Project Manager

Project Manager% % %

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Matrix Organization Stucture

• Project staffs are designated to more than one supervisor; – Report to both;

• Project managers and • Head of their functional areas.

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Types of Matrix Stuctures

• Weak matrix structures • Strong matrix structures

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Weak matrix structures

• More near to functional organizations.• Project managers;

– Have less authority on projects, – Act like as coordinators than as

independent managers.

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Strong matrix structures

• More near to Projectized organizations.• Project managers are dedicated to projects

with full authority.

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Strong matrix structures

• More difficult to manage a matrix organization.

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Project Management Office (PMO)

• An organizational unit created;– To centralize and coordinate the projects

within an organization.• Matrix structures often have a PMO.• Projectized structures almost always have a

PMO.

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Project Management Context

• Project Stakeholders– Introduction– Who are stakeholders?

• Organizational Structures – Introduction– Functional Organization Structure– Projectized Organization Structure– Matrix Organization Structure– Project Management Office (PMO)

• Standards and Regulations– What is a standard?– What is a regulation?

• Life Cycle of a Tender– Introduction– From the view point of Employer & Tenderer– Summary

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Standard

• A document approved by a recognized body;– Provides, for common and repeated use,

rules, guidelines, or characteristics • For products, processes or services, • With which compliance is not

mandatory. • e.g. some software development standards

such as;– IEEE Software development stds.– High Level Architecture (HLA) M&S std.

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Regulation

• A document that;– Specifies product, process or service

characteristics, including applicable administrative provisions,

– With which compliance is mandatory. • e.g. some safety regulations for production of

public goods.

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Project Management Context

• Project Stakeholders– Introduction– Who are stakeholders?

• Organizational Structures – Introduction– Functional Organization Structure– Projectized Organization Structure– Matrix Organization Structure– Project Management Office (PMO)

• Standards and Regulations– What is a standard?– What is a regulation?

• Life Cycle of a Tender– Introduction– From the view point of Employer & Tenderer– Summary

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Life Cycle of A Tender(Definitions)

• Tender/Awarding :– A process for purchasing a service or

material• Employer/Administration/Client :

– Organization or person that requests to purcase a service or material

• Tender Document :– A set of documents prepared and issued

by the Employer for Tender purpose.

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Life Cycle of A Tender(Definitions)

• Tenderer :– Company submitting a proposal to the

Tender• Tender Proposal :

– The proposal of the Tenderer to meet the required service or material of the Employer

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Life Cycle of A Tender(Definitions)

• Tender Board/Commitee :– A group of people authorized by Employer

• To select the best tender proposal among the submitting ones

–According to Employer policies.• Contractor :

– Company elected for providing the service and materials specified in the Tender document.

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Life Cycle of A Tender(Definitions)

• Contract :– Written agreement between Employer and

Contractor• Setting forth the obligations of the

parties thereunder,–Including, but not limited to;

»The performance of the work, »The furnishing of labor & materials

and the basis of payment.

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Employer (Stage 1)

• The Employer determines his needs.• Prepares a written document for his needs

– (Project Definition Document).• Prepares a document for tendering process,

– Including conditions and formalities of purchasing– (Conditions of Contract, and Accompanying

Documents).• Determines tender closing date.• Prepares a guideline for the Tenderers

– (Instructions to Tenderers).• Issues the Tender.

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Employer (Stage 2)

• Employer issues the tender by – Publishing it in the official gazette, and/or– Sending invitation letters:

• To eligible companies or• If it is a confidential project,

–To eligible companies having some; »Quality Levels (e.g. ISO, CMMI) »Security certificates (e.g. National,

NATO).

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Employer (Stage 3)

• Until the tender closing date, the Employer :– May revise tender documents,– May postpone tender closing date,– May answers questions of Tenderers.

• Collects proposals until tender closing date and– Pricing envelopes are only opened after this date.

• Examines proposals for procedural convenience, and– May request Tenderer for correction of

inconvenience.• Tenderers whose proposals do not satisfy procedural

requirements are eliminated from the tender.

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Employer (Stage 4)

• Employer starts evaluating valid proposals and assigning points to them:– Technical Evaluation,– Company Qualification,– Administrative Evaluation,– Price Evaluation.

• Employer orders companies with respect to their points.

• Employer selects: – Either a winner company or– A few winner companies (short list)

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Employer (Stage 5)CASE 1 : A Winner Company

• In Case of a single winner company:– Winner company is announced– Employer;

• May bargain price, • May request Best and Final Offer (BAFO), and • Discuss administrative and technical conditions

and specifications with the winner.– An agreement is made.– A contract is signed by both parties.– Project is initiated.

• In case of disagreement, – Employer may call second eligible company for

contracting.

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Employer (Stage 5)CASE 2 : A Short List

• In Case of multiple winner companies:– Employer;

• May bargain prices, • May request BAFO, and • Discuss administrative and technical conditions

and specifications with each winner – (This could be done in a meeting open to all

winners or in seperate meetings with individual winners).

– Employer aim at obtaining best with lowest price.– Employer selects the most beneficial winner.– An agreement is made.– A contract is signed by both parties.– Project is initiated.

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Tenderer (Stage 1)• Obtains Tender documents;

– If Emloyer requests a price for applying, pays it.• Starts preparing a proposal:

– Examines project requirements and risks;– Prapares a coarse project management plan;

• Decides on the architecture (or alternatives);• Builds a work breakdown structure;• Estimates resources (e.g. time, cost) required;• Prepares a schedule if not given by the employer• Prepares a price breakdown structure;• Answers technical matters;• Answers administrative matters;

– Prepares;• Official letters, Tender forms, Guatantee letters.

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Tenderer (Stage 2)

• Asks Employer for clarifications of unclear issues.

• Revises his proposal.• Attaches;

– Hardware and software specification documents,

– Company qualification documents:• References,• Certifications (e.g. ISO, CMMI),• Any other related document.

• Finalize Tender proposal.

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Tenderer (Stage 3)

• Submits Tender proposal,– Before Tender Closing Date;– Tries to submit it as late as possible;– Gets a verification document from Employer for his

submission.• Waits for requests and decisions of Employer.• In case called by Employer,

– Holds several meetings for agreement,– May reduce the price, or – Increase/decsrease specifications.– Upon agreement,

• Signs a contract with the Employer, and • Project is initiated.

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SummaryEMPLOYER

prepares tenderdocuments

EMPLOYERpublishes tender

documents

TENDERERgets tenderdocuments

TENDERERprepares tender

proposal

TENDERERsubmits tender

proposal

Tender closing date(deadline forproposals)

EMPLOYERcollects and

evaluates proposals

EMPLOYERmay request correctionof inconveniences from

TENDERERS

EMPLOYERorders the proposals

EMPLOYERcalls a winner

for bargain

EMPLOYERcalls elected winners

for bargain

EMPLOYERannonces winner

EMPLOYER &TENDERER

prepare contract

EMPLOYER & TENDERER

signs the contract

EMPLOYERmakes a decision

(continue or cancel)EMPLOYERselects the most

benefical proposal

EMPLOYERmay call the

second winnerProject is initiated

EMPLOYERanswers questions

EMPLOYERgets support

of a consultant

EMPLOYERgets support

of a consultant