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Lecture April 7, 2011
Project Management
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Overview
Project planning III
Repetition
Project Organization
Summary
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adaptation
Model of Project Control
Project planning
content / deliveries
start and end dateteam members
Target values budget
Control
Activities
Project control
Real values
Monitoringdiscrepancies
Real values
Project execution scope change disturbance capacity problems
inter personal problems
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From the Structure to Scheduling of a Project
Work package
Work breakdown structure
2 6
7 12 153
4
5
8
9
10
11
13
14
16
Schedule (e.g. network)
1
BCreate list ofrequirements
CProject sc hedule
DConduct
Feasibility study
EPhase plan
Projektmmgtcreation
F
Project reportstudy
GDesign
system concept
HDeterminefunctions
IPhase planconcept
JDetermine
development process
Project reportConcept
AProject
organization
Work Flow
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Example: Gantt-Chart
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0 0 0
0 0 0
Project start
0 1 1
2 2 3
1 2 3
3 2 5
5 4 9
5 0 9
9 0 9
project end
9 0 9
0 5 5
0 0 5
5 1 6
6 1 7
6 2 8
7 1 9
earliest starting date estimated duration earliest finishing date
latest start Total float latest finishing date
Determine Critical Path
Activity 1 Activity 3 Activity 5
Activity 2 Activity 4 Activity 6
1. step: forward calculation
2. step: backward calculation
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Top-down (global) estimation methods For a fast and easy, approximate estimation of projects cost. Uses parameters, key data (e.g. per volume)
Bottom-up (analytical, AP-based) estimation methods
Basis for detailed project cost planning Basis for cost based project controlling
Work packagecosts
Workpackages
Type ofcost
Projectcosts (PC)
Allocatio
n
PC overtime
Principles of Cost Estimation in Projects
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Project Organization
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Project Organization: Introduction
Classical (permanent) organization structure of a company
Determines leadership structure and organizational rules to manage thetask
Set up for recurring, well-known transaction
Mostly skill-orientated structure
But projects require: Intensive interdisciplinary cooperation
Specific tasks and workflows
Specific leadership and motivation of employees
Particular leadership tasks and structure
=> Project organization
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Definition: Project Organization
The term project organization refers to the organization,
which is assigned with a project and its integration in the
existing organization of the company.
(Kummer: Projektmanagement. 1986. S. 41)
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Organizational Structure of a Project
Organization
Structure
Process
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Tasks of the Structural Organization
Result- and fact oriented arrangement of the functionalstructure of the project
Clear allocation of task, responsibilities and competencies
Effective collaboration and cooperation of all partiesconcerned in the project
Fast alignment of the project organization to changes in theobjectives and boundary conditions
Source: Litke, H.-D.: Projektmanagement. Hanser 1995
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People in Projects
Steering committee
Project leader
Project team
Special
functions
Expert committee
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People in Projects
Steering committee
Project leader
Project team
Special
functions
Expert committee
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Steering Committee
Temporary, project accompanying committee
Superior authority to project leader and project team (to bereported to)
Gives a summary of decision-makers and responsiblepersons for the project (e.g. later user, systemresponsibility, commercial responsibility)
Take essential decisions for project together
Task ends after project is finished
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Main Tasks of a Steering Committee
Principals representative of the interests, the participating divisionsin the project or outsider
Definition of project objectives and project tasks (together withproject manager)
Agreement and assignment of members to the consulting team
Controlling and approval of the project plan Setting priorities
Verification and approval of the elaborated phase results
Support and advice of all major occurring problems
Make decisions, which exceed competency of the project manager
Resource allocation Mediation if conflicts occur
Enforcement of outside related topics of the project
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Steering Committee
Composition 1 representative of each relevant hierarchy level/line
Representatives of each essential involved parties
Project manager
Experts
Possibly representatives of external groups (politicalrepresentatives)
Criteria to choose members
Position, which enhance the implementation of the project
Expertise Position as an information carrier
Involvement
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People in Projects
Lenkungsausschuss
Projektleitung
Projektteam
SpezielleFunktionen
Fachausschuss Steering committee
Project leader
Project team
Special
functions
Expert committee
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Expert Committee
Should inform, support and advice the project team
Placement of expertise in terms of effects, risks,accompaniment
To carry out results of the project team into special fields
Committee with supporting and advising function, butwithout decision-making authority
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People in Projects
Lenkungsausschuss
Projektleitung
Projektteam
SpezielleFunktionen
Fachausschuss Lenkungsausschuss
Projektleitung
Projektteam
SpezielleFunktionen
Fachausschuss Steering committee
Project leader
Project team
Special
functions
Expert committee
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Project Management
Is in charge of the attainment of the project goal, as regardscontent as well as competence
Has the duty to assure the best possible success of theproject, technical as well as economical
Prerequisites to carry out this duty:
- Clear project brief- Objectives which are agreed on, realizable and measurable
- Well-defined area of responsibility
- Sufficient resources
- Congruent tasks and authoritiesDuty of the project
management to intervene
or to refuse if those termsare not fulfilled!
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Tasks of the Project Management
To plan the project To align tasks, competencies, responsibilities, resources
To set priorities
To assure and control system and project tasks
To push the project, evolve initiative To take action to realize the project within the given specification
(activity, costs, deadlines)
To clear up conflicts
To prepare and procure decisions
To initiate contacts
To assure communication
To lead and motivate the project team
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People in Projects
Steering committee
Project leader
Project team
Special
functions
Expert committee
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People in Projects
Lenkungsausschuss
Projektleitung
Projektteam
SpezielleFunktionen
Fachausschuss Lenkungsausschuss
Projektleitung
Projektteam
SpezielleFunktionen
Fachausschuss Steering committee
Project leader
Project team
Special
functions
Expert committee
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Special Functions
Consulting in methodology
Documentation management
Liaison people (to the concerned parties)
Power promoter
Technical promoter
Social promoter
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Overview of the Project and Organization Structures
Pure project organization
Influence project organization
Matrix project organization
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Pure Project Organization (1)
Department CDepartment BDepartment A
Projekt B
PM B
Board of
Management
Projekt A
PM A
Source: Litke, H.-D.: Projektmanagement. Hanser 1995
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Pure Project Organization (2)
Virtually separate organization for a project
Managed in full responsibility by the project leader
Project team members are displaced, delegated for theduration of the project
Project team members get only briefed by the project
manager
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+ Full concentration of all involved members to the project goals
+ High identification with the project
+ Full line authority of the project manager
+ Clear managerial authority
+ Taut leadership of the project
+ Fast reaction to changes/ disturbances
+ Fast coping with difficulties
- Allocation of requisite dedicated resources- Little exchange of specialists with divisions
- Problematic capacity utilization of specialists
- Critical reintegration of the team members at the end of the project
Pros and Cons of a Pure Project Organization
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Influence Project Organization (1)
Board ofManagement
Department B
PM Staff
Department CDepartment A
Source: Litke, H.-D.: Projektmanagement. Hanser 1995
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Influence Project Organization(2)
Minimum configuration of a project organization
Functional organization/ hierarchy remains unchanged
Organization is extended by a project leader in a executive
management team function (on a sufficient high level)
Project leader on management team function level- Has only information and advising rights towards the departments
- Has no decision and directive authority
- Tracks project regarding content, deadlines and costs
- Proposes measures to line managers- Motivates employees within the departments to actively participate in
the project towards the fulfilling of the project objectives
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+ Flexibility regarding work force usage (involvement in severalprojects possible)
+ Improved learning curve (experience from several projects)
+ No change of company organization necessary
+ Continued relation to department
- Limited identification and responsibilities
- Limited need to solve problems across departments
- Response and decision time low (involvement of lineorganization!)
Pros and Cons of the Influence Project Organization
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Matrix Project Organization (1)
Executive board
Project 1
Project 2
Department A Department B Department C
Projectrelated
directives
Function related directives
Source: Litke, H.-D.: Projektmanagement. Hanser 1995
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Matrix Project Organization (2)
Main principle: Combination of a vertical (functional) and ahorizontal (project oriented) organization
Project executed by the departments as a service providerfor the project (focus on execution)
Project leader coordinates and is responsible for the projectas a whole (focus on project targets, planning andcontrolling)
More than one project leader may use same resources
Project members are assigned to department manager +
project leader
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+ balanced consideration of project dimension and professional
dimension+ Goal oriented coordination of different interests
+ High identification of all employees with the project
+ Simultaneous technical source for project team members
- Potential to conflict since different interest of line and project
- Cut of the authority of the line => danger of arguments concerningcompetencies and passive resistance
- Enormous coordination effort between line and project management
- Difficult situation for employees (servant of two masters)
Pros and Cons of the Matrix Project Organization
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Advantages of a Functional Home Base
A flexible deployment of staff is possible
Continuity of further training in expertise is rather assured
Special knowledge and specific experience can be transferredfrom one project to the next
Those employees, which are not completely moved out of
their original organization feel more comfortable and moresecure.
Source: Litke, H.-D.: Projektmanagement. Hanser 1995
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Choice of the Adequate Organizational Structure
Project organization and project management can only besuccessful, if the existing management system and the projectorganization match up.
The choice of the project organization depends on:- structure of the existing organization
- size and duration of the project
- its importance for business policy reasons
- necessity of the interdisciplinary cooperation of different areas
- project risk
- availability of resources
- experience in project organizations
- number/ frequency of projects in one area
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Project Size
< 6
6-50
> 50
< 0,4
0,4-50
> 50
< 0,1
0,1-10
> 10
Small project
Medium sizedproject
Major project
Numberemployees
Mio. DMMan-year
Source: Litke, H.-D.: Projektmanagement. Hanser 1995
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Reasons for a Change in Project Organization During a
Project
Different emphases and people in different phases
Changes of objectives and contents as the project runs
Exchange of important staff members
E l f Ch i P j t O i ti
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Example for a Change in Project Organization
Creativity and brainstorming
come to the fore. Performance
of the project uncertain.
High interdisciplinarycooperation needed.
Project has high importance
for business policy reasons.
Conceptual design largely
finished, no need anymorefor cooperation
with other departments.
ReasoningProfile of
project organizationPhaseInfluence-
project organization
Matrix-project organization
pure
project organization
Line organization
Definition
Draft
Realization
TrialSource: Litke, H.-D.: Projektmanagement. Hanser 1995
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Summary and Preparation for the Next Session
Pure project organization (p.o.): independent, PL in the fore Influence p.o.: existing organization is completed to a minimum Matrix p.o.: overlay of the vertical (functional) organization with a
horizontal (project orientated) organization
Preparation Post processing of today's lecture