OVERVIEW OVERVIEW

UNDERSTANDING PROJECT UNDERSTANDING PROJECT MANAGEMENTMANAGEMENT

In order to understand project In order to understand project management, one must begin with the management, one must begin with the definition of a project. A project can be definition of a project. A project can be considered to be any series of activities and considered to be any series of activities and tasks that:tasks that:- Have a specific objective to be completed within Have a specific objective to be completed within

certain specification.certain specification.- Have defined start end datesHave defined start end dates- Have funding limits (if applicable).Have funding limits (if applicable).- Consume human and nonhuman resources Consume human and nonhuman resources - Are multifunctiononal.Are multifunctiononal.

Successful project management can then be Successful project management can then be defined as having achieved the project defined as having achieved the project objectivesobjectives

- Within timeWithin time- Within costWithin cost- At the desired At the desired

performance/technology levelperformance/technology level- While utilizing the assigned While utilizing the assigned

resources affectively and resources affectively and efficientlyefficiently

- Accepted by the customerAccepted by the customer

The potential benefits from project The potential benefits from project management are:management are:

Identification of functional responsibilities to Identification of functional responsibilities to ensure that all activities are accounted for ensure that all activities are accounted for regardless of personnel turnover.regardless of personnel turnover.

Minimizing the need for continuous reportingMinimizing the need for continuous reporting Identification of times limits foe schedulingIdentification of times limits foe scheduling Identification of a methodology for trade of Identification of a methodology for trade of

analysisanalysis Measurement of accomplishment against plans.Measurement of accomplishment against plans. Early identification of problems so that corrective Early identification of problems so that corrective

action may followaction may follow Improved estimating capability for future planningImproved estimating capability for future planning Knowing when objectives cannot be met or will be Knowing when objectives cannot be met or will be

exceededexceeded

TOPMANAGEMENT

POLICY

MIDLE MANAGEMENT

PLANNING

SUPERVISORSCHEDULING

LABORERSOPERATIONS

MANAGEMENT GAPS FUNCTIONAL GAPS:DEPARTEMENTIZATION

OPERATIONALISLANDS

+ =

FIGURE 1-1. Why are systems necessary?

Figure 1-2 is a pictorial representation of project Figure 1-2 is a pictorial representation of project managementmanagement

RESOURCES

TIM

E CO

ST

PERFORMANCE/TECHNOLOGY

FIGURE 1-2. Overview of project management

Figure 1-2 is a pictorial representation of Figure 1-2 is a pictorial representation of project management.project management.

The objective of the figure is to show The objective of the figure is to show that project management is designed to that project management is designed to manager or control company resources manager or control company resources on a given activity, within time, within on a given activity, within time, within cost, and within performance.cost, and within performance.

DEFINING PROJECT SUCCESSDEFINING PROJECT SUCCESS

The definition of project success has been The definition of project success has been modified to include completion:modified to include completion:- Within the allocated time periodWithin the allocated time period- Within the budgeted costWithin the budgeted cost- At the proper performance or specification At the proper performance or specification

levellevel- With acceptance by the customer/userWith acceptance by the customer/user- With minimum or mutually agreed upon scope With minimum or mutually agreed upon scope

changeschanges- Without disturbing the main work flow of the Without disturbing the main work flow of the

organizationorganization- Without changing the corporate cultureWithout changing the corporate culture

THE PROJECT MANAGER-LINE THE PROJECT MANAGER-LINE MANAJER INTERFACEMANAJER INTERFACE

We have stated that project manager must control company We have stated that project manager must control company resources within time, cost and performance. Most companies resources within time, cost and performance. Most companies have six resources:have six resources: MoneyMoney ManpowerManpower EquipmentEquipment FacilitiesFacilities MaterialsMaterials Information/technologyInformation/technology

Actually, the project manager does not control any of these Actually, the project manager does not control any of these resources directly, expect perhaps money (i.e., the project resources directly, expect perhaps money (i.e., the project budget)budget)

It should become obvious at this point that successful project It should become obvious at this point that successful project management is strongly dependent on:management is strongly dependent on:

- A good daily working relationship between the project manager A good daily working relationship between the project manager and those line managers who directly assign resources to and those line managers who directly assign resources to projects.projects.

- The ability of functional employees to report vertically to line The ability of functional employees to report vertically to line managers at the same time that they report horizontally to one or managers at the same time that they report horizontally to one or more project managers.more project managers.

Defining The Project Manager’s Defining The Project Manager’s Role Role

- The integration activities performed by the The integration activities performed by the project manager include: project manager include: - Integrating the activities necessary to develop Integrating the activities necessary to develop

a project plana project plan- Integrating the activities necessary to execute Integrating the activities necessary to execute

the planthe plan- Integrating the activities necessary to make Integrating the activities necessary to make

changes to the planchanges to the plan The integrative responsibilities are shown The integrative responsibilities are shown

in Figure 1-3 where the project manager in Figure 1-3 where the project manager must convert the inputs into output of must convert the inputs into output of products, service and ultimately profits.products, service and ultimately profits.

INTEGRATED PROCESSES

Integration Management

Products

Services

Profits

Outputs

• Capital

• Materials • Equipments

• Facilities • Information

• Personnel

Figure 1-3. Integration management

DEFINING THE PROJECT DEFINING THE PROJECT MANAGER’S ROLEMANAGER’S ROLE

DEFINING THE FUNCTIONAL DEFINING THE FUNCTIONAL MANAGER’S ROLEMANAGER’S ROLE

There are three elements to this role:There are three elements to this role: The functional manager has the The functional manager has the

responsibility to define how the task will responsibility to define how the task will be done and where the task will be done.be done and where the task will be done.

The functional manager has the The functional manager has the responsibility to provide sufficient responsibility to provide sufficient resources to accomplish the objective resources to accomplish the objective within the project’s constraintswithin the project’s constraints

The functional manager has the The functional manager has the responsibility for the deliverableresponsibility for the deliverable

PROJECT SPONSORSENIOR MANAGEMENT

PROJECT SPONSORLOWER/MIDLE MANAGEMENT

•OBJECTIVE SETTING•UP-FRONT PLANNING•PROJECT ORGANIZATION•KEY STAFFING•MASTER PLAN•POLICIES•MONITORING EXECUTION•PRIORITY SETTING•CONFLICT RESOLUTION•EXECUTIVE CLIENT CONTACT

PROJECTSPONSOR

RELATIONSHIP

PROJECT MANAGER

PROJECT TEAM

PROJECT MANAGER

FIGURE 1-4. The Project Sponsor Management

THE PROJECT MANAGER AS THE PLANNING THE PROJECT MANAGER AS THE PLANNING AGENTAGENT

As the architect of the project plan the project manager As the architect of the project plan the project manager must provide:must provide: Complete task definitionsComplete task definitions Resource requirement definitions (possibly skill levels)Resource requirement definitions (possibly skill levels) Major timetable milestonesMajor timetable milestones Definition of end item quality and reliability Definition of end item quality and reliability

requirementsrequirements The basis for performance measurementsThe basis for performance measurements

Project managers are responsible for project Project managers are responsible for project administration and, therefore must have the right to administration and, therefore must have the right to establish their own policies, procedures, rules, guidelines establish their own policies, procedures, rules, guidelines and directives-provided these policies, guidelines and so and directives-provided these policies, guidelines and so on, conform to overall company policy. Companies with on, conform to overall company policy. Companies with mature project management structures usually have mature project management structures usually have rather loose company guidelines, so project managers rather loose company guidelines, so project managers have some degree of flexibility in how to control their have some degree of flexibility in how to control their projects. projects.

Continue….Continue…. However projects managers cannot make any promises to However projects managers cannot make any promises to

a functional employee concerning:a functional employee concerning: Promotion Promotion GradeGrade Salary Salary Bonus Bonus Overtime Overtime Responsibility Responsibility Future work assignments Future work assignments

These seven items can be administrated by line managers These seven items can be administrated by line managers only, but the project manager can have indirect only, but the project manager can have indirect involvement by telling the line manager how well an involvement by telling the line manager how well an employee is doing (and putting it in writing), requesting employee is doing (and putting it in writing), requesting overtime because the project budget will permit it and overtime because the project budget will permit it and offering individuals the opportunity to perform work above offering individuals the opportunity to perform work above their current pay grade.their current pay grade.

DELEGATION OF AUTHORITYPROJECTMANAGER

EXECUTIVEMEDDLING

LACK OF UNDERSATNDING OF HOW PROJECT MANAGEMENT SHOULD WORK

LACK OF TRAINING COMMUNICATION SANTER PERSONAL SKILLS

FIGURE 1-5. The tip-of-the-iceberg syndrome for matrix implementation

MANY OF THE PROBLEMS SURFACE MUCH LATERTHE PROJECT AND RESULT IN A MUCH HIGHER COSTTO CORRECT AS WELL AS INCREASE PROJECT RISK

RELATIVEINFLUENCE

FUNCTIONAL INFLUENCEINDECISION MAKING DUAL INFLUENCE

PRODUCT INFLUENCEIN DECISION-MAKING

FUNCTIONAL ORGANIZATION

MATRIX PRODUCTORGANIZATION

NON-PROJECT

DRIVENPROJECT

DRIVENNON-PROJECT

DRIVEN

INFORMAL

P.M.

FORMAL

P.M.

INFORMAL

P.M.

FIGURE 1-6. Decision making influence

MARKETING IN THE PROJECT MARKETING IN THE PROJECT DRIVEN ORGANIZATIONDRIVEN ORGANIZATION

Marketing project requires the ability to Marketing project requires the ability to identify, pursue and capture one of a kind identify, pursue and capture one of a kind business opportunities, and is characterized business opportunities, and is characterized by:by: A systematic effort. Is usually required to A systematic effort. Is usually required to

develop a new program lead into an actual develop a new program lead into an actual contract.contract.

Custom design. Custom design. Project life cycle. Project oriented business have Project life cycle. Project oriented business have

a well defined beginning and end and are not self a well defined beginning and end and are not self perpetualing.perpetualing.

Marketing phaseMarketing phase RisksRisks The technical capability to performThe technical capability to perform

FIGURE 1-7. The phases of winning new contracts in project oriented business

IDENTIFY NEW

BUSINESSOPPORTUNITY

PRELIMBID

DECISION

DEVELOPTHE NEW

OPPORTUNITY

BIDDECISION RFP

DEVELOPPROPOSAL& PRICING

NEGOTIATECONTRACT WIN

• SEARCH FOR NEW BUSINESS

• ANALYZE AND EVALUATE

• SELECT• DEDICATE

RESOURCES

•SIGNIFICANT CUSTOMER CONTACT•OBTAIN & ANALYZE REQUIREMETNS•DEVELOP PROJECT BASELINE•ESTABLISH R&D PROGRAMS•BUILD FAVORABLE IMAGE•ESTABLISH PROJECT ORGANIZATION

• PROPOSAL PLANNING• PROPOSAL TEAM ORGANIZATION• WIN STRATEGY• RFP ANALISIS• CATEGORICAL OUTLINE• TEXT & ART GENERATION• COST ESTIMATING & PRICING• REVIEWS• PROPOSAL PUBLICATION• PRICING

• POST SUBMITTAL PLANNING• ORAL REVIEWS, FACT FINDING QUESTIONS & ANSWERS• MARKETING• NEGOTIATIONS

Classification of ProjectClassification of Project

The principles of project The principles of project management can be applied to any management can be applied to any of project and to any industry. Table of project and to any industry. Table 1-4 shows a brief comparison of 1-4 shows a brief comparison of certain industries/projects.certain industries/projects.

Table 1-4 Classification of Projects/CharacteristicsTable 1-4 Classification of Projects/Characteristics

Type Of Project IndustryType Of Project Industry

In-houseIn-house

R&DR&D

SmallSmall

ConstructionConstruction

LargeLarge

ConstructionConstruction

Aerospace/Aerospace/

DefenseDefense

MISMIS EngineeringEngineering

Need for interpersonal Need for interpersonal skillsskills

Importance of Importance of Organizational structureOrganizational structure

Time management Time management difficulties difficulties

Number of meetingsNumber of meetings

Project manager’s Project manager’s supervisorsupervisor

Project sponsor present Project sponsor present

Conflict intensityConflict intensity

Cost control level Cost control level

Level of Level of planning/scheduling planning/scheduling

LowLow

LowLow

LowLow

ExcessiveExcessive

Middle Middle

ManagemeManagement nt

YesYes

LowLow

LowLow

Milestones Milestones

Only Only

LowLow

LowLow

LowLow

LowLow

TopTop

ManagemeManagement nt

NoNo

LowLow

LowLow

Milestones Milestones

Only Only

HighHigh

LowLow

High High

ExcessiveExcessive

Top Top

ManagemeManagement nt

YesYes

High High

High High

Detailed Detailed Plan Plan

High High

LowLow

LowLow

ExcessiveExcessive

Top Top

ManagemeManagement nt

YesYes

High High

High High

Detailed Detailed Plan Plan

HighHigh

HighHigh

HighHigh

HighHigh

Middle Middle

ManagemeManagement nt

NoNo

HighHigh

LowLow

Milestones Milestones

Only Only

LowLow

LowLow

LowLow

Medium Medium

Middle Middle

ManagemeManagement nt

NoNo

LowLow

LowLow

Milestones Milestones

Only Only

PRESIDENT

VICE PRECIDENT

DIRECTOR

DEPARTMENT

DIVISION

SECTION

LABORER

60

50

40

30

20

10

1-9

PROJECT DRIVEN

NON-PROJECT DRIVEN

FIGURE 1-8. Organizational hierarchy

The lesson to be learned here is the cain of The lesson to be learned here is the cain of command should be used for approving projects, command should be used for approving projects,

not planning themnot planning them

The ultimate reporting location of the The ultimate reporting location of the project manager is heavily project manager is heavily dependent on whether the dependent on whether the organization is project-or on-project-organization is project-or on-project-driven and whether the project driven and whether the project manager is responsible for profit or manager is responsible for profit or loss.loss.

VICE PRECIDENTENGINEERING

DIVISIONMANAGER

DEPARTMENT MANAGER

SECTIONSUPERVISOR

PROJECTMANAGER

INFORMATIO

N REQUEST

FIGURE 1-9. The organizational hierarchy: for planning and/or approval?

DIFFERING VIEWS OF PROJECT DIFFERING VIEWS OF PROJECT MANAGEMENTMANAGEMENT

In project-driven organization, there are In project-driven organization, there are three career paths that lead to three career paths that lead to executive management:executive management:

- Through project managementThrough project management- Trough project engineeringTrough project engineering- Trough line managementTrough line management