state of the art dec 9-10 2004 sao paulo - russell...

State of the Art of Project Management: 2004

Russell D. ArchibaldFellow PMI and APM/IPMA, PMP, MSc

PMI-Sáo Paulo 4th International SeminarSáo Paulo, Brazil, December 9-10 2004

December 9-10 2004Russ Archibald PMI-Sáo Paulo

4th International Seminar 2

Purpose of My Presentation

1. To convey a comprehensive picture of the worldwide state of the art in this management discipline in 2004, and

2. To provide some predictions of future developments over the next 5 years



Presentation Outline

1. PM within Organizations

2. PM Applications and Practices

3. PM and People

4. PM in the Next Five Years



1. PM Within Organizations

Characteristics of PM

Projects, Programs, and Project Portfolios

Organizational Capabilities & Maturity in PM




Projects obviously drive PMStart – End, have life cycle phasesFunctional organizational methods don’t work on projectsPM practices have evolved over past 50 years



Three Key PM Differences VersusFunctional Management

1. Integrative project responsibilities 1. General manager2. Portfolio steering groups3. Project & program sponsors4. Manager of PM/PMO (Chief Projects Officer/CPO)5. Project and programs managers6. Functional (specialist) managers & project

leaders



PM Versus Functional Mgt (Cont’d)

2. Integrative & predictive practices, methods, systems, and tools for planning, scheduling, monitoring & controlling projects, programs & portfolios

3. Building and directing project teams of multi-functional specialists.



Project/Functional Matrix

Always have to operate within some form of a project/functional matrix‘Weak’ or ‘Strong’ matrix:

Refers to authority of the Project Manager to give project direction to the functional team members



Total Life Cycle PMEarly years: Focus on planning & executing phasesToday: Total life cycle management:

Including early conceptual & ‘after’ phasesPortfolio PM links corporate strategy with project management

Now include realization of project benefits as part of PM discipline



Realizing Project Benefits

Organizational change often required to achieve full benefits from completing a specific project

“Business Change Manager” is sometimes appointed



Projects, Programs, & Project Portfolios

Importance of categorizing projects

Possible project categories

Programs

Project Portfolios



Categorizing Projects

Projects:Are the common denominator for all aspects of project managementExist in many sizes & typesProduce many different products & resultsCan be classified in many different ways



Project Categories

Why bother? Because:“One size does not fit all”Life cycle models and processes good for one category are not good for others

Recommended categories are based on project end results



Need for an Agreed Project Classification SystemThe many uses of such a system include:

Select/develop best life cycle models for a classIdentify and apply best practices by class for project:

Selection and prioritizationPlanning, execution and control methods, templatesRisk management methodsGovernance policies and proceduresDeveloping specialized software applications

Build specialized libraries of knowledgeFocus and improve education, certification, career planningProvide research directionOther:



Recommended Major Categories1. Aerospace/Defense2. Business &

Organizational Change Projects

3. Communication Systems Projects

4. Event Projects5. Facilities Projects

6. Information Systems

7. International Development

8. Media & Entertainment

9. Product/Service Development

10. Research & Dev.



Other Major Categories May Be Required

See Table 1 in the paper for detail

Further breakdown is obviously required

A few examples follow



Sub-Categories Are RequiredOne example:2. Business & Organization Change

Projects:1. Acquisition/merger2. Management process improvement3. New business venture4. Organization re-structuring5. Legal proceeding6. Other: ?



Example:Category 5. Facilities Projects

Subcategories:1. Facility decommissioning2. Facility demolition3. Facility maintenance & modification4. Facility design/procure/construct

1.Civil 2.Energy 3.Environmental 4.Industrial 5.Commercial 6.Residential 7.Ships 8.Other:

5. Other: ?



Categories AreNot Mutually Exclusive

Programs and large projects usually involve more than one category or sub-categoryThese projects are placed in their

predominate categoryMust “Mega” projects be treated

separately? Probably: yes

PM Maturity by Project Category

X10. Research & DevelopmentX9. Product/Service Development

X8. Media & EntertainmentX?X?7. International DevelopmentX6. Information Systems

X5. FacilitiesX4. Events

X3. Communication Systems

X2. Business & Organizational Change

X1. Aerospace/Defense

Still Maturing

Fairly Mature

Very Mature

Project Category

General Uncertainty by Project Category

X10. Research & DevelopmentX9. Product/Service Development

X8. Media & EntertainmentX7. International Development

X6. Information SystemsX5. Facilities

X4. EventsX3. Communication Systems

X2. Business & Organizational Change

X1. Aerospace/Defense

HighMediumLowProject Category



Classifying Within Categories & Sub-Categories

Project sizeMajor & minor projectsProject complexityExternal or internal customerDegree of customer involvementLevels of risk, who takes responsibility Stand-alone versus create supporting infrastructureStandard versus transitional Mega projects: not categorizableOther: ? (See Crawford, Hobbs and Turner, 2002)



Multi-Project ProgramsProgram: Long term effort comprising two or more closely linked projects

Common resourcesCommon higher level objectives

PMI PMBOK: single project managementPMI working on new standards for program and portfolio management



Programme Management: UK

Office of Government Commerce/OGCPRINCE2Management of Risk/M_o_RManaging Successful Programmes/MSP

Programme management in UK is essentially the same as project portfolio management in North America



Project Portfolio Management

Portfolios link corporate strategy with project managementPortfolio steering group holds responsibilityMust implement a project portfolio management processVarious types of project portfolios

StrategicObjective

1

OperationalStrategy 1.3



Project 1.1.3

Project 1.1.2

Project 1.1.1

Project 1.2.2

Project 1.2.1

Project 1.3.3

Project 1.3.2

Project 1.3.1

Program 1.1

Project Portfolio for Strategic Objective 1



Example:Hewlett-Packard/Compaq Merger

Established Global Project Management Office/PMO (IT aspects only)CIO was actually the Program ManagerHad PMOs at lower levelsGlobal virtual teamsKilling projects was equally important to completing remaining projects



How HP Manages Its Programs & Projects

HP uses Portfolio Management to optimize investment mix for its IT projects:

Maintenance and support projectsInfrastructure projectsInnovation projects

“We now have all our IT projects in one common central database, a true enterprise-scale project management system.”



Source:

“Implementing a Global Program Management Office”

By Don Kingsberry, Director Global PMO, and

Jake Stewart, Manager Global PMO, both with Hewlett-Packard,

presented at the 2003 PMI Global Congress in Baltimore, MD, USA




Many PM Maturity ModelsPMI’s OPM3 (For a critical review see http://www.pmforum.org/pmwt04/viewpoints04-910more.htm )PRINCE2 in UKJapan’s P2M (Project & Program Management)http://pmcc.or.jp/www/english/p2m.html

Purposes of these models:Assess current capabilitiesEducateImprove



UK Office of Gov’t Commerce-OGC: Prince2 plus others

Visit www.ogc.gov.uk“Successful Delivery Toolkit” CD and other valuable documents available free“OGC works with government to improve procurement and project/programmemanagement. We also work with suppliers to make the government marketplace more efficient and attractive to business.”



Maturity of Project Management Itself Within a Category

Different perspective from organizational PM maturityMaturity must be viewed by project class or categoryThe most mature categories are:

Aerospace/DefenseFacilities



Chief Projects Officer/CPO

Does for PM what the CFO does for financial managementDirects the Project Management Office/PMOAt corporate or operating division levels






3. PM and People




2. PM Applications, Life Cycle Models, Practices & Tools

Areas of PM Application

Project Life Cycle Models

PM Planning & Control Practices, Systems, and Tools



Many Areas of PM ApplicationRapid expansion in areas of application of PM within past 13 years

PMI members 1990: 8,500; 2004: 133,00027 PMI specific interest groups/SIGSProject-driven & project dependent organizationsPlus project categories previously mentioned



Diversity of Projects: 23 PMI Specific Interest Groups/SIGS

Aerospace/DefenseAutomationAutomotiveE-businessEnvironmentalFinancial ServicesGovernmentHealthcareHospitality EventsInformation Systems

Info Tech’n’gy/TelecomInt’n’l DevelopmentManufacturingNew Product Develop.Oil/Gas/PetrochemicalPharmaceuticalRetailService & OutsourcingUtility IndustryPlus 4 others



Project Life Cycle ModelsMany life cycle models are in useThey portray a project as an overall process or systemTheir purposes include:

To enable all to understand overall processTo capture best experience, enable improvementTo relate roles, responsibilities, systems and tools to all elements of the project



Generic Life Cycle: 4 PhasesConcept

Initiation, identification, selectionDefinition

Feasibility, development, demonstration, design prototype, quantification

ExecutionImplementation, realization, production & deployment, design/construct/commission, installation and test

Closeout



Generic Life Cycles

Apply to any projectToo broad to be very useful, practicalNeed to be tailored to the project category…

… And key environmental factors



3 Parameters to Work With:

1. Number & definition of phases & sub-phases

2. Their inter-relationships: sequential, overlapping, repeated

3. Number, definition and placement of key decision points



Identify Deliverables: Each Phase and Sub-Phase

Documents related to the project:Objectives, scope, plans, schedules, reports, authorizations, work orders, etc.

Documents related to the product:Specs, drawings, product cost, reports, etc.

Physical products or results:Mock-ups, models, prototypes, test articles, tooling, equipment, software, facilities, materials, etc.



Defining Decision PointsKey events/milestones – ‘gates’ – at start & end of a phase or sub-phaseDecisions typically authorize project manager & team to:

Complete current phase, start nextRevise objectives, scope, scheduleRe-plan, re-start, repeat previous workTerminate or put project on hold



Deliverables & Decision Points

Decisions are made based on contents or results of key deliverablesTherefore these two elements are closely linkedYou can’t make good decisions without adequate information

Stage-GateTM Life Cycle ProcessSource: Cooper et al 2001 see www.prod-dev.com



Documenting a Project Life Cycle Management Process

Define the life cycle:Select the life cycle model to be usedName phases, sub-phases decision pointsEstablish inter-relationships among themPortray the result: flow chart, narrative

Specify authorizing documents:Purpose & levels of approval authorityFor initiation & major changes



Documenting PLCMS (Cont’d)

Identify key roles & define responsibilitiesIdentify major deliverables by phaseSpecify issue escalation proceduresSpecify differences for:

Major vs minor projects, orOther project classes within a sub-category



Improving the PLCMS

1. Document the integrated project life cycle model

2. Document & describe the PLCMS3. Re-engineer the integrated process

Apply systems thinking: TOC

4. Implement the improvements5. Repeat these steps as required



Hi-Tech Project Categories & Their Life Cycles

4 basic hi-tech categories (of 10) :Communication SystemsInformation SystemsProduct & Service DevelopmentResearch & Development



Hi-Tech in Other CategoriesDefense/Aerospace:

Very advanced, specialized life cycles prescribed by DOD & NASA

Facilities (design and construction):Very mature, specialized life cycle models

Hi-tech projects within programs in these and other categories can be placed in one of the preceding 4 hi-tech categories



Two Types of Hi-Tech Life Cycle Models

Predictive:Waterfall, Prototyping, Rapid Application Development/RAD, Incremental Build, Spiral

Adaptive:Adaptive Software Development/ASD, Extreme Programming/XP, SCRUM



Predictive Life Cycle ModelsWaterfall

Linear ordering phases, sequential or overlapping, no phase repeated

PrototypingFunctional requirements and physical design specs are generated simultaneously

Rapid Application Development/RADBased on an evolving prototype that is not thrown away



Predictive LC Models (Cont’d)

Incremental BuildDecomposition of large development effort into a succession of smaller components

SpiralRepetition of the same set of life-cycle phases such as plan, develop, build, and evaluate until development is complete



Adaptive Life Cycle Models

Adaptive Software Development/ASD:Mission driven, component based, iterative cycles, time boxed cycles, risk drive, change tolerant

Extreme Programming/XPTeams of developers, managers, and users; programming done in pairs; iterative process; collective code ownership



Adaptive LC Models (Cont’d)

SCRUM (as in rugby)Similar to above adaptive models with iterations called “sprints” that typically last 30 daysDefined functionality to be met in each sprintActive management role throughout



“Agile” Project Management

Adaptive life cycles are jointly called “Agile” PM methods and models“Agile Software Development Manifesto” issued in 2001www.agilemanifesto.org



XP Resources

www.extremeprogramming.org/index/htmlwww.industriallogic.comwww.xprogramming.comwww.objectmentor.com/homehttp://c2.com/cg/wiki?ExtremeProgrammin

gRoadmap



Rational Unified Process/RUP®

Process framework for Software developmentSoftware customization

Also a process product developed and maintained by IBM Rational:

Integrated with a suite of SW toolsAvailable on CD-ROM or via Internet



Six Best Practices in RUP®

1. Develop SW iteratively: Use iterative life cycle2. Manage requirements3. Use component-based architectures4. Visually model SW5. Continuously verify SW quality6. Control changes to the SW

For info:www.maxwideman.com/papers/acquisition/intro.htm



Impact of Environment on Life Cycle Model Selection

Project environment is of primary importance in selecting a LC model for a given project category:

Organizational characteristicsFamiliarity with involved technologyCompetitive demands (schedule, other)Other




Integrative & predictiveAll contributors to the projectAll life cycle phasesAll elements of information: scope, schedule, resources, cost, risk, technical, progressWeb enabled



Programs & Portfolios

Information for:Single projectMulti-project programsProject Portfolios

Summarize as requiredLink with on-going operations within the organization

Software CategoryPMI PM Software Survey 1999

PMBOK® Guide Knowledge Areas

Suites (36) All

Process/Scope Management (19)

Integration Management

Schedule Management (43)

Time Management

Cost Management (27) Cost Management

Resource Management (27)

Human Resources Management

Risk Management and Assessment (15)

Risk Management

Communications Mgt (17) Subcategories:Graphics Add-ons (21)Timesheets (25)Web Publ/Organ’rs (15)

Communications Management



Best Practice: One Integrated System

One corporate systemAble to link different systems when customer or partner demands other systems



Web-Enabled PM Systems

24 hour availability to any locationEasy to update and useImproves reporting & timelinessImproves project baseline controlSimplifies document retrieval and controlQuicker response to problems



Distributed PM/DPM Software

Many areas of application now using DPMAway from complex desktop apps to easy-to-use browser based systemsMarket: Over US$3 billion in 2004



Critical Chain vs Critical Path

Resource buffers quantified in CCRange estimates of duration in CCSome claim great benefits from CCOthers say CPM can be used in same way



Russian Resource Critical Path/RPC

Considers all constraintsCalculates resource constrained activity float (similar to CC buffers)Uses range estimates for duration and resourcesProduces success probabilities for risk management



Risk Management on Projects

Area of great interest today“Uncertainty important and useful with inherent opportunities for project improvements” – Lichtenberg, Denmark



Linking PM With Operations

PM systems must link with the total organization

Enterprise resource management/ERP probably best linkage point






3. People and Teams in PM




3. PM & People

Individual Capabilities in PM

Project Teams

The ‘Profession’ of Project Management



PM Education & Training

900+ organizations in PMI’s R.E.P. program worldwide60,000 students per yearIPMA’s 30 national associations provide many education & training coursesMany Doctoral, Master, Bachelor degrees in PM



PM Certification ProgramsPMI: 2 levels: PMP & CAPM81,913 PMPs on May 31, 2004Heavily based on knowledge of PMBOKCritics say it is not:

Based enough on capabilitySufficiently application orientedCertification of project managers per se Does not deal with multi-project management



PMI Certification

PMBOK now available in 8 languagesMoving toward

Multi-project program and portfolio managementApplication specific certification



IPMA Certification: 4 Levels

A: Certificated Programme Director/CPDB: Certificated Project Manager/CPMC: Registered Project Management Professional/RPMPD: Project Management Fachman/Fachfrau/PMF



APM (UK) Certification

Currently 3 levels:Certified Project Manager (IPMA level B)Practitioner Qualification (IPMA level C)APMP (IPMA level D)

APM Group accredits trainers for OGC



Other Certification ProgramsAustralian Institute of PM/IAPM:

3 levelsBased on National Competency Standards for PM

American Society for Advancement of PM/asapm:

Developing a 4 level certification programNASA: 4 level internal certification



Licensing of People in PM

True profession requires official licensingNo country, state or province presently licenses project managers or specialistsPM is a management discipline, not a true profession



3. PM & People


Project Teams




Project TeamsTeamwork is essential for effective project managementTeamwork requires:

Identification of team membersClear project objectivesAchievable plan and scheduleRulesLeadership by the project manager



Effective Teamwork

Satisfy ALL project stakeholdersHard/soft dimension:

Tangible/measurable and intangible/subtle expectations aspects

Acceptable/excellent dimension:Good enough and outstanding



3. PM & People


Project Teams




The ‘Profession’ of PM

Discussions continue around the world: Management discipline or ‘profession’?Many experienced practitioners:

“PM is a core competency for every executive”“PM is a sub set of general management; little probability that it will become a ‘legally based profession’






3. People and Teams in PM




4. PM in the Next 5 Years

Basic characteristics of PM:Little change

Three major trends:1. Strategic & project management linked

through project portfolio management2. Total project life cycle management,

including realization of project benefits3. New areas of PM application



PM in the Next 5 Years (Cont’d)

Organizational capabilities and maturity:PM will merge into general management, become required competency for top executives, similar to financial management competency




PM maturity modelsWill be at least 3 major models in wide use: PMI’s OPM3, Japan’s P2M, OGC/UK’s PMMAdaptations will emerge within specific areas of PM application and project typesTranslations of these will appear in 8 or 10 languages




Individual Capabilities in PMCertification will be

Based more on proven capabilitiesSharply focused on specific areas of application and/or project typesAwarded at 3 or 4 levels

Demonstrated PM capabilities (not necessarily certification) will be a prerequisite for senior management positionsGovernmental licensing in PM will not exist




Projects, programs & project portfolios:Portfolio management will be used widelyGlobal project categorization system based on results will be widely acceptedIndividual PM certification will be more focused on project type




Project life cycle models:Catalog of models for specific project types will be available for adaptation

Areas of PM ApplicationFormalized PM will be used in essentially all areas of human endeavor




PM Planning & Control Systems & Tools:Systems fully integrated with corporate ISPM software further specialized to fit project typesWeb-enabled PM used by allWireless devices will access complex software on centralized serversPM software vendors will begin consolidation phase of a mature industry




Project teams:Virtual teams meet regularly on most large projectsMajority of project managers will be proficient in team building and leadership

‘Profession’ of PM:Many will still say it is a profession but no governmental licensing will existPM will be widely known and used by managers at all levels




Variations in status and applicability around the world:

Still some minor differences in PM in industrialized countriesConcepts will not be universally valid

Cultural differencesEconomic differencese. g.: Developing countries in Central Africa & elsewhere



Acknowledgements

Thanks to:David H. CurlingAlan HarphamDavid L. PellsR. Max Wideman

And all the many colleagues, clients, and students from whom I have learned over the decades.



Thank you for listening!

Questions? Rebuttals? Arguments?Contact me at

[email protected] this paper atwww.russarchibald.comGo to ‘Author>recent papers’