cse1720 project management project management some statistics: – in 2001, the expenditure on...

Cse1720 Project Management

Project ManagementProject Management

• Some statistics:

– In 2001, the expenditure on Projects in the United States of America was $US 2.3 trillion

– This is 25% of the nation’s GDP

– It is estimated that the world expenditure on projects is approximately $US10 trillion of its $40 trillion gross product



– Approximately 16 million people regard project management as their profession

– A ‘Project Manager’ earns in the vicinity of $US80,000 to $US100,000 per year

– In 2000, the number of IT application development projects was 300,000.

– In 2001 this increased to 500,000 projects



Some advantages of Project Management

– Better control of financial resources

– Better control of physical resources

– Better control of human resources

– Improved customer relations

– Shorter development times



– Lower costs

– Higher quality - Increased reliability

– Improved productivity

– Improved internal coordination

– Increased worker morale



• You should ask

1 ‘ Better than what’

2. ‘How is better measured’

3. ‘Is the measurement before and after on the same basis’

However: Governments, corporations, and non-profit organisations (can you name one ?) recognise that modern project management techniques are necessary for ‘success’.

(you should read the article by the Standish Group on their study of IT application projects)



This is a good time to ask : ‘What is a Project ?’

Try this : ‘A project is an endeavour to create a unique product or service’.

Projects:– normally involve several people performing interrelated

activities, – the main customer of a Project is interested in the

effective use of resources to complete the Project in an efficient and timely manner

Are your assignments ‘projects’ ?



• And there is more :-– A project has a unique purpose - there must be a clear

and defined objective

– A project is temporary (some are long term, some are short term) - There is a definite beginning and a definite end point

– A project can be split into ‘segments’ - each of which can realistically be a ‘project’ (can you think of one ?)



– A project requires resources - often from various areas. These resources are people, hardware, software and other assets

– A project frequently crosses ‘departmental’ boundaries - e.g. sales, marketing, management, IT



– A Project should have a primary customer(s) or sponsor(s)

– Projects have interested parties (stakeholders) but there must be a primary role of sponsor

– This sponsor provides direction and funding for the project



– A project involves ‘uncertainty’ - Each project in unique.

– It is often difficult to clearly define the project objectives to estimate how long it will take to complete or the ‘cost’

– all of which makes Project Management a challenge



– Project Managers work with the project sponsor(s), the project team and other ‘involved’ people (such as the ‘users’

– There are 3 ‘constraints’ in Project Management scope of the project time to develop and deliver costs

– These are often known as the ‘ triple constraint’

– Balance of these constraints is essential



– A project Manager is much occupied with Scope - What is the project objective

- What is the expectation of the project

Time - How long to complete ? Schedule ?

Cost - What is the ‘total’ cost

Project Managers ‘trade off’ scope, time and costs - increase one, decrease another constraint.



What is ‘Project Management’ ?

It is the application of knowledge, skills tools techniques

to project activities in order to meet project requirements



There are 9 Knowledge Areas associated with Project Management

They are :

1. Scope Management

2. Time Management

3. Cost Management

4. Quality Management

These are regarded as ‘Core Functions’



Supporting these ‘Core’ functions are 4 ‘Facilitating’ functions

5. Human resources Management

6. Communications Management

7. Risk Management

8. Procurement Management

And, the 9th Function is :

Project Integration Management



Who (or what) are Stakeholders ?

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

They include – the Project Sponsor (of course)

– the Project Team

– Support Staff

– Customers



– Users

– Suppliers

– Those opposed to the Project

(have I left anybody/group out ? - such as -)– Senior Management ? Senior Administration ?– Auditors ? Regulatory Bodies ? ?



Stakeholders often have completely different needs and expectations. Consider the building of a new house:

Who would you consider is the Project Sponsor ?

Who would be the Project Manager - the Contractor ?

Who would be the Project Team ?

Who would be the ‘support staff’ ? - Suppliers ?

Would there be any ‘opposition’ stakeholders ?

- Who? Why ?



• Are you a Stakeholder in any project ?

• Were you ‘involved’ when the Monash Home Page was redesigned and introduced

• Were you involved when your favourite bank changed its home page

• Are you ‘involved’ when Amazon.com changes its home page and access patterns ?



• Project Management probably sounds like an enormous effort

• However, there are many tools and techniques which exist to lessen the workload and which make project managers very effective.

• These are classed as ‘Project Management Tools and Techniques’ - and they will change, improve and expand - and probably become more integrated and ‘intelligent’



• Project Management Tools and Techniques are directed at scope, time, cost and quality management

• There are other tools which provide assistance with human resource, communication, risk, purchase (or procurement) and integration management.

• Time Management - are you familiar with these ? Gantt charts network diagrams critical path analysis



On the next few overheads there are some Project Management Tools and techniques

Knowledge Area Tools and Techniques

Integration Management Project plans

Project Management

Project reviews

Scope Management Net present value

Requirements analysis

Return on Investment

Time Management Network diagrams

Critical path analysis

Program Evaluation and Review Techniques


Project ManagementProject ManagementKnowledge Area Tools and Techniques

Cost Management Earned value management

Cost estimates

Cost management plan

Quality Management Quality control charts

Quality audits

Statistical methods

Human resource Management Motivation techniques

Resource diagrams

Resource levelling

Responsibility matrices



Knowledge Area/Category Tools and Techniques

Communications Conflict management

Management Meetings

Project Web sites

Procurement Management Contracts

Requests for Proposals

Selection of Source

Risk Management Risk management plan

Risk ranking

Probability matrices



• Other knowledge requirements General management Organisational behaviour Financial analysis planning techniques

Automation of a Sales force would require knowledge of

the processes

appropriate automation software

mobile computing

can you suggest others ?



• Project Management Job Functions– Define scope of project– Identify stakeholders, decision makers– Develop detailed task list– Estimate time requirements– Develop initial project management flow chart– Identify resources and budget– Evaluate project requirements– Identify, evaluate and rank risks



– Prepare contingency plan or plans– Identify critical point (or milestones)– Identify Interdependencies

and– Take part in phase reviews– Secure needed resources– Mange the change control process– Report project status



A quick quiz:- read the ‘effective’ project manager attributes, and then develop an ‘ineffective’ manager’s attributes

An Effective Manager An Ineffective Manager

Leads by example

Has ‘vision’

Is technically competent

Is decisive

Is a good communicator

Is a good motivator

Will argue with senior management (if/when necessary)

Supports team managers

Encourages new ideas



Time for a few comments/feedback

How does or would a Project Manager stay technically competent ?

Does ‘decisive’ mean a strong ‘yes’ or ‘no’ ? Are there any other requirements ?

What does ‘supporting team members’ imply

Does ‘encouragement of new ideas’ automatically imply acceptance or introduction ?


Project Integration ManagementProject Integration Management

Project Integration Management

This involves the co-ordination of all of the project management knowledge areas during the project life cycle (you remember the Project Life Cycle don’t you ?)

Integration Management is essential to ensure that cohesiveness is assured - that all of the components of a project merge together

at the right time

in the right order

at the required level of quality

and complete the project



Project Integration Management involves these processes– Project Plan Development : all of the other planning

processes become part of a ‘Project Plan’– Project Plan Execution : All of the activities included in

the Project Plan are activated and performed– Integrated Change Control : Any and all changes to the

Project are co-ordinated

Not surprisingly - Management of project scope, quality, time, cost., human resources, communication, risk and procurement is essential



Let’s have a quick look at a Project Plan

This is a document which– coordinates all project planning documents– assists in guiding and focussing the execution of a

project and its control

Project Plans also document– project planning assumptions– decisions where there is more than one choice



A Project Plan also– provide or make possible communication among the

stakeholders– define content, scope and timing of management

reviews– provide the guideline or measuring point for the

measurement and control of a project

Project Plans should be dynamic ( meaning ???)

Project Plans should be flexible (is this good or bad ?)

Project Plans must alter when the conditions or environment of the Project alter.



You have probably formed the impression that a Project Manager must be an ‘Integrator’

A Project Manager must possess and use Integration Management skills

Remember that Information is required from all of the project management knowledge areas



• So, what does a Project Plan introduction (overview) contain ?– The Project name - which must be unique (why ?)– A concise description of the project, and why the project

does or should exist (is this the same as the Project Justification ?)

– Reference to the Sponsor (in what detail /)– Reference to the Project Manager and the Key team

members– The deliverables– References to (Scope, Schedule, Cost, Quality,

Communications ……. Management plans)



• A description of the project organisation– An organisation chart which should show

lines of authority responsibilities communication

– Project responsibilities

• Management and Technical matters– Management objectives– Project controls– Risk management– Technical processes - (for example) methodology



• The Scope Management plan– A work breakdown structure– Key deliverables– Key Deliverable dependencies– Quality of product deliverables

• Project Schedule Information– A short (one page) summary schedule– A detailed schedule (which shows dependencies e.g.

work and funding dependencies)



• Budget– A summary budget - the ‘numbers’ by month, quarter ..– A detailed budget - Fixed and recurring costs each

year..– People skills, method of calculation of labour costs

• Stakeholder Analysis (why include this ?)– The names of the ‘key’ stakeholders– The stakeholders roles on/with the project– Their level of influence– Stakeholder relationships management

and this could be a ‘sensitive’ document



• We have successfully dealt with Project Plan Development• Now we will deal with Project Plan Execution

– This is the 2nd stage of Project Integration Management

– This involves managing and performing the work described in the project plans

– Most of the project’s budget is spent on execution - this is where the major time component exists - and where the project product(s) appears (or appear)



• Coordination of Planning and Execution

– Project Planning and Execution are firmly linked The main output of creating project plans is to direct

or guide project execution A good plan = a good product And a good plan must document the the basis of

evaluation of ‘good work’



• Leadership and Support– This might seem ‘off centre’ but Project Execution is

very dependent on these attributes– As you saw in a previous overhead, Project Managers

must lead by example – They must show the importance of creating skilled and

accurate project plans– Project Managers must follow the project plans in the

development and execution of the project– In addition to this, there must be strong organisation

culture - which means that clear and accepted organisation rules exist.



– Project Managers must also have business, product and application area knowledge

– A ‘small’ project may call on the Project Manager to develop or work on some of the technical work involved

– On ‘large’ projects the Project Manager must lead the team and communicate with the key users - which means that the project manager has strong business and application area skills - and possibly lesser developed technology skills



Some Project Execution Tools and Techniques

1. A work authorisation system

2. Status review meetings (not written weekly or monthly reports - personal and verbal reviews are much more effective)

3. Project Management software (Microsoft Project ?)



• Integrated Change Control Process

There are 3 major aspects here;

1. Ensuring that any changes are a benefit - and this can mean trade-offs between scope, time, cost and quality

2. Has a change occurred ? This requires the Project Manager to know at all times the status of the key project items …. and ….

Communication of changes with senior management, and the major stakeholders - quickly and accurately

3. Managing changes as they occur. A Key role of Project Managers and their teams. It is important to use discipline to minimise the number of changes (why ?) (Have you heard of prototype system development ?)



Inputs to the Integrated Change Control Process– Project plans– Performance reports– change requests

Outputs from the Change Control Process– Project plan updates– Corrective action to be taken– Documentation– Confirmation of Change - or No Change



– The Project Plan is the source for identifying and controlling changes (key deliverables)

– The schedule section of the project plan shows the planned dates for completion of key deliverables

– Performance Reports give status information relating to the project execution is progressing

These give an ‘early warning’ of possible future problems

– Is corrective action necessary/essential ?– What is the ‘best’ course of action ? – When should action be taken ?



The Change Control System– This is a formal, documented process which describes

when and how project documents may be changed– It describes the authorised persons, the necessary

documentation, and automated or manual tracking systems the process will use.



– In large, expensive projects is it common to have a Change Control Group (who would be in this Group ?)

– This Group would provide guidelines for preparing change requests Evaluate change requests Manage the change implementation

Question:= Can you see any problems with this approach ?



• Integrated Change Control also includes Configuration Management

• This ensures that the project product descriptions are correct and complete

• Concentrates on the functional and physical aspects of products and their support documentation



And we have already mentioned the essential nature of communication

Try answering these questions– Who communicates with whom ?

– What do they communicate ?

– Is this communication formal or informal ?

– How is this communication performed ?



• Some suggestions about Integrated Change Control Management– Consider project management as a process of

continuing communication and negotiation– Plan for change and plan change– Use a formal change control system– Utilise configuration management– Use written and verbal performance reports to identify

and manage change– Use Project Management software to assist in

managing and communication of change



Some Thoughts on Project Scope Management– Scope : This is all of the effort which is necessary to

create the product or products of the project

It includes the processes required to create them

– Project Scope Management includes all of the processes involved in defining and controlling what is, or is not, going to be included on a project

– This should ensure that the Project Team and the Stakeholders are in step with what the project is going to produce AND what processes will be used to produce these products



Have you noticed the range and incidence of ‘Management’ ?

Scope Management uses these 5 processes:- Initiation - a commitment of an Organisation to begin

(or continue) a project - generally results is a Charter Scope Planning - this was covered in the previous

overheads - why is it so important ? Scope Definition - The subdivision of the major

project deliverable into smaller, more manageable components - a ‘divide and conquer’ approach ?



And finally Scope Verification - Formal acceptance of the project

scope - who would be involved in this ?

Scope Change Control - the mechanism which controls changes to the project scope


Project Initiation ManagementProject Initiation Management

How do Projects materialise ?

Who causes Projects to become Projects ?

We need to look briefly at Strategic Planning - and you know who is involved with this. - (Senior or Executive Management)

Another question is : What Projects do or could be necessary ?



• A Strategic Plan will (or should) identify what projects will provide the most value to an Organisation

• Project Initiation involves Identifying potential Projects

• This is in many cases a 4 stage Planning process

• Strategic Planning involves determining long term objectives

• Strengths and weaknesses of an Organisation are out under scrutiny

• Opportunities are studied• Future trends are studied• The need for new products and services is studied



• You have probably heard of the SWOT analysis

• If you haven’t, here it is : S - Strengths W - Weaknesses O - Opportunities T - Threats

• In the next few overheads we will be looking at an Information Technology planning and initiation planning process



The IT Planning Stages

Information Technology Strategy Planing

Business Area Analysis

The Results Produced

Results in linking IT strategy to the organisation mission and vision.It identifies key Business Areas

A document of the Key Business Processes which could benefit from the Introduction or Extension of IT



The IT Planning Stages Project Planning

Resource Allocation

The Results Produced

Define potential projects

Define Project scope, benefits and constraints

Select Information Technology Project or Projects

Assign resources


Project Initiation ManagementProject Initiation ManagementProject selection methods include :– Focus on broad organisational needs

– Categorising Information Technology projects

– Performing net present value and/or other financial analyses

– Using weighted scoring models

– Implementing a ‘balanced’ scorecard

– General practice is to use a combination of these


Selecting ProjectsSelecting Projects

Categorising IT Projects

Problems : Inhibit an organisation from achieving its goals

They may be current, or anticipated

(e.g. poor response because of overload, insufficient communictions capability,

disk space, …)

Opportunities : Are changes to improve an organisation

e.g. direct selling to customers

Internet sales

Directives : Are (generally) new requirements set by management, government or an external

influence (e.g. conservation)



Performing NPV, ROI and Payback Analyses

Financial aspects are an important input to the project selection process

It is normal for an ‘Approved Business Case’ to be the key to project selection. The 3 methods above are used.

Net Present Value (NPV) establishes the expected gain (or loss) from a project by discounting all expected future cash inflows and outflows to the ‘present point in time’

A positive NPV indicates that the return from a project exceeds the cost of capital - the return from investing the capital in another or different area.



Return on Investment (ROI) is the result of subtracting the project costs from the benefits, and then dividing the result by the costs.

ROI is expressed as a percentage and may be + or -. Generally the higher the ROI, the better

The required rate of return is the minimum rate of return on an investment

The internal rate of return refers to a discount rate which effectively results in a zero NPV for a project



Payback Analysis is the calculation of the amount of time it would take to recoup, as net cash inflows, the net amount invested in a project - or how much time is required for accrued benefits to to overtake accrued costs and continuing costs

Payback occurs when the cumulative discounted benefits and costs are greater than 0



The Weighted Scoring Model is a tool which gives a systematic method (or process) for selecting projects based on multiple criteria.

(meeting management needs, addressing current or anticipated problems, opportunities, time taken to complete a project, overall priority, projected financial performance ….)

Each criteria is then ‘weighted’ - which is a measure of the importance of the various criteria

Each project Score is then calculated and the ‘highest; scorer is the most advantageous project



The Balanced Scorecard Model is a method which converts an Organisation’s stimulators (customer service, innovation, operational efficiency, financial performance…) to a series of metrics (measurement methods)

This method was developed by Kaplan and Roberts, and there is a website at www.balancedscorecard.org which will give you much information about this method


SummarySummary

The material presented at this lecture was designed to give you some contact with many of the aspects, both in the broad and at some detail level, which are associated with a ‘Project’.

As you saw in the last few overheads, Business frequently uses these techniques in determining the assessment of competing or possible IT projects

Hopefully you found the material both informative and interesting

And it may have given you another ‘dimension’ for your future career

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