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WAUBONSEE COMMUNITY COLLEGE

Project Management – Day 3

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Review

WAUBONSEE COMMUNITY COLLEGE PROJECT MANAGEMENT TRAINING

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Project Management – A Systematic Process (and common sense)

Initiating

Planning

Executing

Monitoring /Controllin

g

Closing

Project Management Framework

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Figure 1-2

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The Triple Constraint of Project ManagementSuccessful project management means meeting all three goals (scope, time, and cost) and satisfying the project’s sponsor!

Intranet Gantt Chart Organized by Project Management Process Groups

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Determining the Critical Path for Project X

7Figure 6-8

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Communications Management

WAUBONSEE COMMUNITY COLLEGE PROJECT MANAGEMENT TRAINING

The greatest threat to many projects is a failure to communicate

Our culture does not portray IT professionals as being good communicators

Research shows that IT professionals must be able to communicate effectively to succeed in their positions

Strong verbal skills are a key factor in career advancement for IT professionals

Importance of Good Communications

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• Identifying stakeholders: identifying everyone involved in or affected by the project and determining the best ways to manage relationships with them

Planning communications: determining the information and communications needs of the stakeholders

Distributing information: making needed information available to project stakeholders in a timely manner

Managing stakeholder expectations: managing communications to satisfy the needs and expectations of project stakeholders and to resolve issues

Reporting performance: collecting and disseminating performance information, including status reports, progress measurement, and forecasting

Project Communications Management Processes

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Project Communications Management Summary

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• Recall that the ultimate goal of project management is to meet or exceed stakeholder needs and expectations from a project, so you must first identify who your particular project stakeholders are

• Two key outputs of this process include:• Stakeholder register: a public document that includes details

related to the identified project stakeholders • Stakeholder management strategy: an approach to help

increase the support of stakeholders throughout the project; often includes sensitive information

Identifying Stakeholders

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Stakeholder Management Strategy

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Every project should include some type of communications management plan, a document that guides project communications

Creating a stakeholder analysis for project communications also aids in communications planning

Planning Communications

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Sample Stakeholder Analysis for Project Communications

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Getting the right information to the right people at the right time and in a useful format is just as important as developing the information in the first place

Important considerations include:

Using technology to enhance information distribution

Formal and informal methods for distributing information

Distributing Information

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Don’t bury crucial information

Don’t be afraid to report bad information

Oral communication via meetings and informal talks helps bring important information—good and bad—out into the open

Distributing Information in an Effective and Timely Manner

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Research says that in a face-to-face interaction: 58 percent of communication is through body language 35 percent of communication is through how the words are said 7 percent of communication is through the content or words that are spoken

Pay attention to more than just the actual words someone is saying

A person’s tone of voice and body language say a lot about how he or she really feels

Importance of Face-to-Face Communication

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Short, frequent meetings are often very effective in IT projects

Stand-up meetings force people to focus on what they really need to communicate

Some companies have policies preventing the use of e-mail between certain hours or even entire days of the week

Encouraging More Face-to-Face Interactions

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Media Choice Table

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• People are not interchangeable parts

• As illustrated in Brooks’ book The Mythical Man-Month, you cannot assume that a task originally scheduled to take two months of one person’s time can be done in one month by two people

• Nine women cannot produce a baby in one month!

Understanding Group and Individual Communication Needs

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• Introverts like more private communications, while extroverts like to discuss things in public

• Intuitive people like to understand the big picture, while sensing people need step-by-step details

• Thinkers want to know the logic behind decisions, while feeling people want to know how something affects them personally

• Judging people are driven to meet deadlines while perceiving people need more help in developing and following plans

Personal Preferences Affect Communication Needs

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• Rarely does the receiver interpret a message exactly as the sender intended

• Geographic location and cultural background affect the complexity of project communications

• Different working hours

• Language barriers

• Different cultural norms

Other Communication Considerations

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Setting the Stage for Communicating Bad News

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Dear Mom and Dad, or should I say Grandma & Grandpa,

Yes, I am pregnant. No, I’m not married yet since Larry, my boyfriend, is out of a job. Larry’s employers just don’t seem to appreciate the skills he has learned since he quit high school. Larry looks much younger than you, Dad, even though he is three years older. I’m quitting college and getting a job so we can get an apartment before the baby is born. I found a beautiful apartment above a 24-hour auto repair garage with good insulation so the exhaust fumes and noise won’t bother us.

I’m very happy. I thought you would be too.

Love, Ashley

P.S. There is no Larry. I’m not pregnant. I’m not getting married. I’m not quitting school, but I am getting a “D” in Chemistry. I just wanted you to have some perspective.

• As the number of people involved increases, the complexity of communications increases because there are more communications channels or pathways through which people can communicate

• Number of communications channels = n(n-1) / 2

where n is the number of people involved

Determining the Number of Communications Channels

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• Project managers must understand and work with various stakeholders

• Need to devise a way to identify and resolve issues

• An expectations management matrix can help clarify expectations

Managing Stakeholders

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Expectations Management Matrix

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Performance reporting keeps stakeholders informed about how resources are being used to achieve project objectives:

• Status reports describe where the project stands at a specific point in time

• Progress reports describe what the project team has accomplished during a certain period of time

• Forecasts predict future project status and progress based on past information and trends

Reporting Performance

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• Manage conflicts effectively

• Develop better communication skills

• Run effective meetings

• Use e-mail and other technologies effectively

• Use templates for project communications

Suggestions for Improving Project Communications

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1. Confrontation: directly face a conflict using a problem-solving approach

2. Compromise: use a give-and-take approach

3. Smoothing: de-emphasize areas of difference and emphasize areas of agreement

4. Forcing: the win-lose approach

5. Withdrawal: retreat or withdraw from an actual or potential disagreement

6. Collaborating: decision makers incorporate different viewpoints and insights to develop consensus and commitment

Conflict Handling Modes

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• Conflict often produces important results, such as new ideas, better alternatives, and motivation to work harder and more collaboratively

• Groupthink: conformance to the values or ethical standards of a group; groupthink can develop if there are no conflicting viewpoints

• Research suggests that task-related conflict often improves team performance, but emotional conflict often depresses team performance

Conflict Can Be Good

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• As organizations become more global, they realize they must invest in ways to improve communication with people from different countries and cultures

• It takes leadership to improve communication

Developing Better Communication Skills

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Sample Template for a Monthly Progress Report

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• The project manager and project team members should each prepare a lessons-learned report

A reflective statement that documents important things an individual learned from working on the project

• The project manager often combines information from all of the lessons-learned reports into a project summary report

Lessons-Learned Reports

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Risk Management

WAUBONSEE COMMUNITY COLLEGE PROJECT MANAGEMENT TRAINING

• Project risk management is the art and science of identifying, analyzing, and responding to risk throughout the life of a project and in the best interests of meeting project objectives

• Risk management is often overlooked in projects, but it can help improve project success by helping select good projects, determining project scope, and developing realistic estimates

The Importance of Project Risk Management

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• Study by Ibbs and Kwak shows risk has the lowest maturity rating of all knowledge areas

• A similar survey was completed with software development companies in Mauritius, South Africa in 2003, and risk management also had the lowest maturity

• KLCI study shows the benefits of following good software risk management practices

Research Shows Need to Improve Project Risk Management

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Project Management Maturity by Industry Group and Knowledge Area*

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KEY: 1 = LOWEST MATURITY RATING 5 = HIGHEST MATURITY RATING

Knowledge AreaEngineering/ Construction

Telecommunications Information Systems

Hi-Tech Manufacturing

Scope 3.52 3.45 3.25 3.37

Time 3.55 3.41 3.03 3.50

Cost 3.74 3.22 3.20 3.97

Quality 2.91 3.22 2.88 3.26

Human Resources 3.18 3.20 2.93 3.18

Communications 3.53 3.53 3.21 3.48

Risk 2.93 2.87 2.75 2.76

Procurement 3.33 3.01 2.91 3.33 

*Ibbs, C. William and Young Hoon Kwak. “Assessing Project Management Maturity,” Project Management Journal (March 2000).

Benefits from Software Risk Management Practices*

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*Kulik, Peter and Catherine Weber, “Software Risk Management Practices – 2001,” KLCI Research Group (August 2001).

• A dictionary definition of risk is “the possibility of loss or injury”

• Negative risk involves understanding potential problems that might occur in the project and how they might impede project success

• Negative risk management is like a form of insurance; it is an investment

Negative Risk

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• Positive risks are risks that result in good things happening; sometimes called opportunities

• A general definition of project risk is an uncertainty that can have a negative or positive effect on meeting project objectives

• The goal of project risk management is to minimize potential negative risks while maximizing potential positive risks

Risk Can Be Positive

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• Risk utility or risk tolerance is the amount of satisfaction or pleasure received from a potential payoff• Utility rises at a decreasing rate for people who are risk-averse

• Those who are risk-seeking have a higher tolerance for risk, and their satisfaction increases when more payoff is at stake

• The risk-neutral approach achieves a balance between risk and payoff

Risk Utility

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Risk Utility Function and Risk Preference

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• Planning risk management: deciding how to approach and plan the risk management activities for the project

• Identifying risks: determining which risks are likely to affect a project and documenting the characteristics of each

• Performing qualitative risk analysis: prioritizing risks based on their probability and impact of occurrence

Project Risk Management Processes

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• Performing quantitative risk analysis: numerically estimating the effects of risks on project objectives

• Planning risk responses: taking steps to enhance opportunities and reduce threats to meeting project objectives

• Monitoring and controlling risks: monitoring identified and residual risks, identifying new risks, carrying out risk response plans, and evaluating the effectiveness of risk strategies throughout the life of the project

Project Risk Management Processes (continued)

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Project Risk Management Summary

46Figure 11-3

• The main output of risk management planning is a risk management plan, a plan that documents the procedures for managing risk throughout a project

• The project team should review project documents and understand the organization’s and the sponsor’s approaches to risk

• The level of detail will vary with the needs of the project

Risk Management Planning

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• Methodology

• Roles and responsibilities

• Budget and schedule

• Risk categories

• Risk probability and impact

• Risk documentation

Topics Addressed in a Risk Management Plan

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• Contingency plans are predefined actions that the project team will take if an identified risk event occurs

• Fallback plans are developed for risks that have a high impact on meeting project objectives and are put into effect if attempts to reduce the risk are not effective

• Contingency reserves or allowances are provisions held by the project sponsor or organization to reduce the risk of cost or schedule overruns to an acceptable level

Contingency and Fallback Plans, Contingency Reserves

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• Several studies show that IT projects share some common sources of risk

• The Standish Group developed an IT success potential scoring sheet based on potential risks

• Other broad categories of risk help identify potential risks

Common Sources of Risk in Information Technology Projects

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Information Technology Success Potential Scoring Sheet

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Success Criterion Relative Importance

User Involvement 19

Executive Management support 16

Clear Statement of Requirements 15

Proper Planning 11

Realistic Expectations 10

Smaller Project Milestones 9

Competent Staff 8

Ownership 6

Clear Visions and Objectives 3

Hard-Working, Focused Staff 3

Total 100

• Market risk

• Financial risk

• Technology risk

• People risk

• Structure/process risk

Broad Categories of Risk

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• A risk breakdown structure is a hierarchy of potential risk categories for a project

• Similar to a work breakdown structure but used to identify and categorize risks

Risk Breakdown Structure

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Sample Risk Breakdown Structure

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Potential Negative Risk Conditions Associated with Each Knowledge Area

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• Identifying risks is the process of understanding what potential events might hurt or enhance a particular project

• Risk identification tools and techniques include:• Brainstorming

• The Delphi Technique

• Interviewing

• SWOT analysis

Identifying Risks

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• Brainstorming is a technique by which a group attempts to generate ideas or find a solution for a specific problem by amassing ideas spontaneously and without judgment

• An experienced facilitator should run the brainstorming session

• Be careful not to overuse or misuse brainstorming• Psychology literature shows that individuals produce a greater number of ideas

working alone than they do through brainstorming in small, face-to-face groups• Group effects often inhibit idea generation

Brainstorming

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• The Delphi Technique is used to derive a consensus among a panel of experts who make predictions about future developments

• Provides independent and anonymous input regarding future events

• Uses repeated rounds of questioning and written responses and avoids the biasing effects possible in oral methods, such as brainstorming

Delphi Technique

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• Interviewing is a fact-finding technique for collecting information in face-to-face, phone, e-mail, or instant-messaging discussions

• Interviewing people with similar project experience is an important tool for identifying potential risks

Interviewing

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• SWOT analysis (strengths, weaknesses, opportunities, and threats) can also be used during risk identification

• Helps identify the broad negative and positive risks that apply to a project

SWOT Analysis

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• The main output of the risk identification process is a list of identified risks and other information needed to begin creating a risk register

• A risk register is:• A document that contains the results of various risk

management processes and that is often displayed in a table or spreadsheet format

• A tool for documenting potential risk events and related information

• Risk events refer to specific, uncertain events that may occur to the detriment or enhancement of the project

Risk Register

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• An identification number for each risk event

• A rank for each risk event

• The name of each risk event

• A description of each risk event

• The category under which each risk event falls

• The root cause of each risk

Risk Register Contents

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• Triggers for each risk; triggers are indicators or symptoms of actual risk events

• Potential responses to each risk

• The risk owner or person who will own or take responsibility for each risk

• The probability and impact of each risk occurring

• The status of each risk

Risk Register Contents (continued)

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Sample Risk Register

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Table 11-5

• Assess the likelihood and impact of identified risks to determine their magnitude and priority

• Risk quantification tools and techniques include: • Probability/impact matrixes• The Top Ten Risk Item Tracking• Expert judgment

Performing Qualitative Risk Analysis

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Figure 11-5. Sample Probability/Impact Matrix

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• Top Ten Risk Item Tracking is a qualitative risk analysis tool that helps to identify risks and maintain an awareness of risks throughout the life of a project

• Establish a periodic review of the top ten project risk items

• List the current ranking, previous ranking, number of times the risk appears on the list over a period of time, and a summary of progress made in resolving the risk item

Top Ten Risk Item Tracking

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Example of Top Ten Risk Item Tracking

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• A watch list is a list of risks that are low priority but are still identified as potential risks

• Qualitative analysis can also identify risks that should be evaluated on a quantitative basis

Watch List

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• Often follows qualitative risk analysis, but both can be done together

• Large, complex projects involving leading edge technologies often require extensive quantitative risk analysis

• Main techniques include:• Decision tree analysis• Simulation• Sensitivity analysis

Performing Quantitative Risk Analysis

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• A decision tree is a diagramming analysis technique used to help select the best course of action in situations in which future outcomes are uncertain

• Estimated monetary value (EMV) is the product of a risk event probability and the risk event’s monetary value

• You can draw a decision tree to help find the EMV

Decision Trees and Expected Monetary Value (EMV)

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Expected Monetary Value (EMV) Example

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• Simulation uses a representation or model of a system to analyze the expected behavior or performance of the system

• Monte Carlo analysis simulates a model’s outcome many times to provide a statistical distribution of the calculated results

• To use a Monte Carlo simulation, you must have three estimates (most likely, pessimistic, and optimistic) plus an estimate of the likelihood of the estimate being between the most likely and optimistic values

Simulation

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• Sensitivity analysis is a technique used to show the effects of changing one or more variables on an outcome

• For example, many people use it to determine what the monthly payments for a loan will be given different interest rates or periods of the loan, or for determining break-even points based on different assumptions

• Spreadsheet software, such as Excel, is a common tool for performing sensitivity analysis

Sensitivity Analysis

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Sample Sensitivity Analysis for Determining Break-Even Point

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• After identifying and quantifying risks, you must decide how to respond to them

• Four main response strategies for negative risks• Risk avoidance• Risk acceptance• Risk transference• Risk mitigation

Planning Risk Responses

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General Risk Mitigation Strategies for: Technical, Cost, and Schedule Risks

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• It’s also important to identify residual and secondary risks

• Residual risks are risks that remain after all of the response strategies have been implemented

• Secondary risks are a direct result of implementing a risk response

Residual and Secondary Risks

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• Involves executing the risk management process to respond to risk events

• Workarounds are unplanned responses to risk events that must be done when there are no contingency plans

• Main outputs of risk monitoring and control are:• Risk register updates• Organizational process assets updates• Change requests• Updates to the project management plan and other project

documents

Monitoring and Controlling Risks

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• Many people joke about the poor quality of IT products

• Cars and Computers joke

• People seem to accept systems being down occasionally or needing to reboot their PCs

• But quality is very important in many IT projects

The Importance of Project Quality Management

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Quality management

WAUBONSEE COMMUNITY COLLEGE PROJECT MANAGEMENT TRAINING

• In 1986, two hospital patients died after receiving fatal doses of radiation from a Therac 25 machine after a software problem caused the machine to ignore calibration data

• In one of the biggest software errors in banking history, Chemical Bank mistakenly deducted about $15 million from more than 100,000 customer accounts

• In August 2008, the Privacy Rights Clearinghouse stated that more than 236 million data records of U.S. residents have been exposed due to security breaches since January 2005

What Went Wrong?

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Quality Management Knowledge Group

• Six Sigma is “a comprehensive and flexible system for achieving, sustaining, and maximizing business success. Six Sigma is uniquely driven by close understanding of customer needs, disciplined use of facts, data, and statistical analysis, and diligent attention to managing, improving, and reinventing business processes.”*

Six Sigma

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*Pande, Peter S., Robert P. Neuman, and Roland R. Cavanagh, TheSix Sigma Way, New York: McGraw-Hill, 2000, p. xi.

• The target for perfection is the achievement of no more than 3.4 defects per million opportunities

• The principles can apply to a wide variety of processes

• Six Sigma projects normally follow a five-phase improvement process called DMAIC

Basic Information on Six Sigma

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• DMAIC is a systematic, closed-loop process for continued improvement that is scientific and fact based

• DMAIC stands for:• Define: define the problem/opportunity, process, and customer requirements• Measure: define measures, then collect, compile, and display data• Analyze: scrutinize process details to find improvement opportunities• Improve: generate solutions and ideas for improving the problem• Control: track and verify the stability of the improvements and the predictability

of the solution

DMAIC

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• It requires an organization-wide commitment

• Training follows the “Belt” system

• Six Sigma organizations have the ability and willingness to adopt contrary objectives, such as reducing errors and getting things done faster

• It is an operating philosophy that is customer focused and strives to drive out waste, raise levels of quality, and improve financial performance at breakthrough levels

How Is Six Sigma Quality Control Unique?

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• Motorola, Inc. pioneered the adoption of Six Sigma in the 1980s and saved about $14 billion

• Allied Signal/Honeywell saved more than $600 million a year by reducing the costs of reworking defects and improving aircraft engine design processes

• After implementing the solutions recommended by a Six Sigma team for Baptist St. Anthony's Hospital in Amarillo, Texas, the percent of delayed cases in the radiology department dropped from 79 percent to 33 percent, delays decreased by 22 percent, and the number of orders missing or needing clarification dropped to zero from 11 percent

What Went Right?

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• Joseph M. Juran stated, “All improvement takes place project by project, and in no other way”*

• It’s important to select projects carefully and apply higher quality where it makes sense; companies that use Six Sigma do not always boost their stock values

• As Mikel Harry puts it, “I could genetically engineer a Six Sigma goat, but if a rodeo is the marketplace, people are still going to buy a Four Sigma horse”**

• Six Sigma projects must focus on a quality problem or gap between the current and desired performance and not have a clearly understood problem or a predetermined solution

*“What You Need to Know About Six Sigma,” Productivity Digest (December 2001), p. 38.

**Clifford, Lee, “Why You Can Safely Ignore Six Sigma,” Fortune (January 22, 2001), p. 140.

Six Sigma and Project Management

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• The training for Six Sigma includes many project management concepts, tools, and techniques

• For example, Six Sigma projects often use business cases, project charters, schedules, budgets, and so on

• Six Sigma projects are done in teams; the project manager is often called the team leader, and the sponsor is called the champion

Six Sigma Projects Use Project Management

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• The term sigma means standard deviation

• Standard deviation measures how much variation exists in a distribution of data

• Standard deviation is a key factor in determining the acceptable number of defective units found in a population

• Six Sigma projects strive for no more than 3.4 defects per million opportunities, yet this number is confusing to many statisticians

Six Sigma and Statistics

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• Using a normal curve, if a process is at six sigma, there would be no more than two defective units per billion produced

• Six Sigma uses a scoring system that accounts for time, an important factor in determining process variations

• Yield represents the number of units handled correctly through the process steps

• A defect is any instance where the product or service fails to meet customer requirements

• There can be several opportunities to have a defect

Six Sigma Uses a Conversion Table

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Normal Distribution and Standard Deviation

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Sigma Conversion Table

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• Unit testing tests each individual component (often a program) to ensure it is as defect-free as possible

• Integration testing occurs between unit and system testing to test functionally grouped components

• System testing tests the entire system as one entity

• User acceptance testing is an independent test performed by end users prior to accepting the delivered system

Types of Tests

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• Watts S. Humphrey, a renowned expert on software quality, defines a software defect as anything that must be changed before delivery of the program

• Testing does not sufficiently prevent software defects because:

• The number of ways to test a complex system is huge

• Users will continue to invent new ways to use a system that its developers never considered

• Humphrey suggests that people rethink the software development process to provide no potential defects when you enter system testing; developers must be responsible for providing error-free code at each stage of testing

Testing Alone Is Not Enough

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• Modern quality management:

• Requires customer satisfaction

• Prefers prevention to inspection

• Recognizes management responsibility for quality

Modern Quality Management

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• As Joseph M. Juran said in 1945, “It is most important that top management be quality-minded. In the absence of sincere manifestation of interest at the top, little will happen below.”*

• A large percentage of quality problems are associated with management, not technical issues

*American Society for Quality (ASQ), (www.asqc.org/about/history/juran.html).

Leadership

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• The cost of quality is the cost of conformance plus the cost of nonconformance• Conformance means delivering products that meet requirements

and fitness for use• Cost of nonconformance means taking responsibility for failures or

not meeting quality expectations

• A study reported that software bugs cost the U.S. economy $59.6 billion each year and that one third of the bugs could be eliminated by an improved testing infrastructure

The Cost of Quality

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• Study by DeMarco and Lister showed that organizational issues had a much greater influence on programmer productivity than the technical environment or programming languages

• Programmer productivity varied by a factor of one to ten across organizations, but only by 21 percent within the same organization

• Study found no correlation between productivity and programming language, years of experience, or salary

• A dedicated workspace and a quiet work environment were key factors to improving programmer productivity

Organizational Influences, Workplace Factors, and Quality

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• Project managers must understand and manage stakeholder expectations

• Expectations also vary by:

• Organization’s culture

• Geographic regions

Expectations and Cultural Differences in Quality

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Title and Content Layout with Chart

Category 1 Category 2 Category 3 Category 40

1

2

3

4

5

6

Series 1 Series 2 Series 3

Two Content Layout with Table

• First bullet point here

• Second bullet point here

• Third bullet point here

Group A Group B

Class 1 82 85

Class 2 76 88

Class 3 84 90