PROJECT MANAGEMENT

1. PROJECT MANAGEMENT Dr. ANANDA KUMAR Professor Department of Mgt. Studies Christ College of Engg. & Tech. Puducherry, India. Mobile: +91 99443 42433 E-mail: searchanandu@gmail.com

2. Unit 1 • Project – Meaning – classification – importance of project management – An Integrated Approach – Project Portfolio Management System – The Need – Choosing the appropriate Project Management structure: Organizational considerations and project considerations – steps in defining the project – project Rollup – Process breakdown structure – Responsibility Matrices – External causes of delay and internal constraints.

3. Project “A project is a one-shot, time-limited, goal-directed, major undertaking, requiring the commitment of varied skills and resources”. A project is temporary in that there is a defined start (the decision to proceed) and a defined end (the achievement of the goals and objectives).

4. Project Management PM is the application of knowledge, skills, tools and techniques to a broad range of activities in order to meet the requirements of the particular project. Project Management knowledge and practices are best described in terms of their component processes. These processes can be placed into five Process Groups: Initiating, Planning, Executing, Controlling and Closing.

5. Time Cost Scope Project Management Constraints Manage these or they will manage you!

6. Project Management Activities 1. Planning the work 2. Assessing and justifying risk 3. Estimating resources 4. Organizing the work 5. Acquiring human and material resources 6. Assigning tasks 7. Directing activities 8. Controlling project execution 9. Reporting progress 10.Analyzing the results based on the facts achieved

7. Executing Project Life Cycle Level of effort Planning Delivering Defining Start Time End Defining 1.Goal 2.Specifications 3.Tasks 4.Responsibilities Planning 1.Schedules 2.Budgets 3.Resources 4.Risks 5.Staffing Executing 1.Status reports 2.Changes 3.Quality 4.Forecasts Delivering 1.Train Customer 2.Transfer documents 3.Release Resources 4.Lessons learned

8. Classification of Project On the basis of Expansion On the basis of Magnitude of the resources to be invested. On the basis of Sector On the basis of Objective On the basis of productivity On the basis of nature of benefits On the basis of risk involved in the product On the basis of Economic life of the project

9. On the basis of Expansion # Project expanding the capacity # Project expanding the supply of knowledge On the basis of Magnitude of the resources to be invested # Giant projects affecting total economy # Big projects affecting at one sector of the economy # Medium size projects # Small size projects (depending on size, investment & impact)

10. 3. On the basis of Sector # Industrial Project # Agricultural project # Educational project # Health project # Social project 4. On the basis of Objective # Social Objective project # Economic objective project

11. 5. On the basis of Productivity # Directivity productive project # Interactively productive project 6. On the basis of nature of benefits # Quantifiable project # Non-Quantifiable project

12. 7. On the basis of risk involved in the project # High risks project # Normal risks project # Low risks project 8. On the basis of economic life of the project # Long term project # Medium term project # Short term project

13. Importance of Project Management Compression of the Product Life Cycle Global Competition Knowledge Explosion Corporate Downsizing Increased Customer Focus Rapid Development of Third world and Closed Economies Small Projects Represent Big Problems

14. Project Management Today – An Integrative Approach Integration of Projects with the Strategic Plan Integration within the Process of Managing Actual Projects Implement Strategies through Projects

15. Customer Integrated Management of Project Environmental Analysis External Internal Firm Mission, Goals, Strategies Priorities Projects System Environment & Culture Project Implementation

16. Socio Cultural Leadership Problem Solving Teamwork Negotiation Politics Customer Expectations The Technical & Sociocultural Dimensions of the Project Management Process Technical Scope WBS Schedules Resource Allocation Baseline Budgets Status reports

17. Vision Mission Strategy Resource Allocation Project Prioritization Performance Tracking Needs Assessment Project Proposals Project Deliverables Enterprise Management Project Portfolio Management Portfolio Management Project Portfolio Executives Teams Management Project Management

18. Project Portfolio Management [PPM] A collection of projects or programs and other work that are grouped together to facilitate effective management of that work to meet strategic business objectives. Portfolio Management is the middleware between Strategic Planning and Project Delivery. It means a systematic process of selecting, supporting, and managing the firm’s collection of projects. Portfolio management ensures projects are aligned with strategic goals appropriately. It provides information to make better business decisions.

19. Project Portfolio Management System Portfolio management requires: decision making prioritization review realignment reprioritization

20. PPM Essentials

21. Major Phases of PPM 1. Establish 2. Evaluate 3. Prioritize 4. Select 5. Manage

22. Evaluate project alignment to the corporate strategy Project Proposal Major Phases of PPM Establish Portfolio strategy Postponed No – Revise & Submit No - Reject yes Cancelled Completed Prioritize project and hold pending funding Manage Active projects On plan Off plan In Trouble Select a balanced portfolio using the prioritized projects

23. Major Phases of PPM 1. Proposed 2. Aligned 3. Prioritized 4. Selected 5. Active 6. Postponed 7. Cancelled 8. Completed

24. Need for an Effective PPM System Problem 1: The Implementation Gap Problem 2: Organization Polities Problem 3: Resource Conflicts and Multitasking

25. Problem 1: The Implementation Gap # Conflicts frequently occur among functional managers and cause lack of trust. # Frequent meetings are called to establish or renegotiate priorities. # People frequently shift from one project to another, depending on current priority. Employees are confused about which projects are important. # People are working on multiple projects and feel inefficient. # Resources are not adequate.

26. Problem 2: Organization Politics Politics exist in every organization and can have a significant influence on which projects receive funding and high priority. This is especially true when the criteria and process for selecting projects are illdefined and not aligned with the mission of the firm. Project selection may be based not so much on facts and sound reasoning, but rather on the persuasiveness and power of people advocating projects.

27. Problem 3: Resource Conflicts and Multitasking Most project organizations exist in a multi project environment. This environment creates the problems of project interdependency and the need to share resources. Resource sharing also leads to multitasking. Multitasking involves starting and stopping work on one task to go and work on another project, and then returning to the work on the original task. People working on several tasks concurrently are far less efficient, especially where conceptual or physical shutdown and startup are significant.

28. Choosing the Appropriate Project Mgt Structure Organization Considerations Project Considerations

29. 1. Organization Considerations If an organization has both standard products and projects, then a matrix arrangement would appear to be appropriate. If an organization has very few projects, then a less formal arrangement is probably all that is required. Temporary task forces could be created on an as-needed basis and the organisation could out-source project work.

30. 1. Organization Considerations Organizing Projects within the Functional Organisation Organizing Projects within a Matrix Arrangement Organizing Projects within a Network organisation

31. Delta manufacturing, inc. President Human Resources Finance & Administration Organizing Projects within the Functional Organisation Marketing Engineering Manufacturing Procurement Electronics Engineering Software Engineering Mechanical Engineering Design Purchasing Receiving & Inspection Customer service Domestic Sales International Sales Fabrication Assembly Testing Production Scheduling

32. Zeta manufacturing inc. President Organizing Projects within a Matrix Arrangement Human Resources Finance Director of Projects Engineering Manufacturing Marketing Project Admin. Design Engg. Software engg. Mechanical engg. Assembly Testing Customer Service P – A PM 1 2 1 2 1 2 P – B PM 1 3 1 1 3 1 1 P – C PM 2 1 2 2

33. Tool & Die firm Marketing Firm Parts Supplies Organizing Projects within a Network organisation Advertising firm Mountain Bicycle Manufacturer Legal firm Project Manager Inventor Bicycle Company

34. 2. Project Considerations At the project level, the question is how much autonomy the project needs in order to be successfully completely. Hobbs and Menard identify seven factors that should influence the choice of project management structure: 1. Size of project 2. Strategic importance 3. Novelty and need for innovation

35. Need for integration (number of departments involved) Environmental complexity (number of external interfaces) Budget and time constraints Stability of resource requirements

36. Defining the Project One of the best ways to meet the needs of the customer & major project stakeholders is to use an integrated project planning and control system that requires selective information. Project managers who manage a single, small project can plan and schedule the project tasks without a formal planning and information system.

37. Steps in Defining the Project Step 1 : Defining the Project Scope Step 2 : Establishing Project Priorities Step 3 : Creating the Work Breakdown Structure Step 4 : Integrating the WBS with the Organization Step 5 : Coding the WBS for the Information System

38. Step 1 : Defining the Project Scope Defining the project scope sets the stage for developing a project plan. Project scope is a definition of the end result or mission of your project – a product or service for your client/customer. The primary purpose is to define as clearly as possible the deliverable for the end user and to focus project plans. Many research clearly shows that a poorly defined scope or mission is the most frequently mentioned barrier to project success.

39. Cont…… Before work on the project can be started, it’s necessary to clearly define what the outcomes of the project will be. This involves not only what specifications and criteria the final project must meet, but when it must be completed and what the budget is. What’s the objective? What are the expected, required, and desired results? How will success be measured? What’s the timeframe? What are the resource implications?

40. Step 2 : Establishing Project Priorities Scope Quality and the ultimate success of a project are traditionally defined as meeting and/or exceeding the expectations of the customer and/or upper management in terms of cost (budget), time (schedule), and performance (scope) of the project. Quality Cost Time

41. Cont…… The interrelationship among these criteria varies. For example, sometimes it is necessary to compromise the performance and scope of the project to get the project done quickly or less expensively. Often the longer a project takes, the more expensive it becomes. However, a positive correlation between cost and schedule may not always be true. Other times project costs can be reduced by using cheaper, less efficient labor or equipment that extends the duration of the project.

42. Step 3 : Creating the WBS Once the scope and deliverables have been identified, the work of the project can be successively subdivided into smaller and smaller work elements. The outcome of this hierarchical process is called the work breakdown structure (WBS). The WBS is a map of the project. Use of WBS helps to assure project managers that all projects and work elements are identified, to integrate the project with the current organization, and to establish a basis for control. Basically, the WBS is an outline of the project with different levels of details.

43. Level Hierarchical breakdown Description 1 Complete project 2 Major deliverable 3 Supporting deliverable 4 Lowest Mgt responsibility level Grouping of work 5 packages for monitoring progress and responsibility Project Hierarchical Breakdown of the WBS Deliverable Sub deliverable Lowest subdeliverable Cost Account Work package

44. Step 4 : Integrating the WBS with the Organization An integral part of the WBS is to define the organizational units responsible for performing the work. In practice, the outcome of this process is the organization breakdown structure (OBS). The OBS depicts how the firm has organized to discharge work responsibility. The purpose of the OBS are to provide a framework to summarize organization unit work performance, identify organization units responsible for work packages, and tie the organizational unit to cost control accounts.

45. Personal Computer prototype Integration of WBS and OBS Vendor, software, application Mouse, keyboard, voice Disk storage units Microprocessor unit External USB Optical Hard Internal Memory BIOS ROM RAM I/O File Utilities Motor Circuit board Chassis frame Read/write head

46. Step 5 : Coding the WBS for the Information System Gaining the maximum usefulness of a breakdown structure depends on a coding system. The codes are used to define levels and elements in the WBS, organization elements, work packages, and budget and cost information. The codes allow reports to be consolidated at any level in the structure. The most commonly used scheme in practice is numeric indention.

47. Project Rollup The work packages and cost accounts serve as a database from which all other planning, scheduling, and controlling processes are coordinated. Cost accounts include one or more work packages. Each work package has time, budget, resource, responsibility, and control points that can be used to track project progress.

48. Work Package Estimates WP Description : Final Version Page : 1 of 1 WP ID : 1.1.3.2 Project : PC proto Deliverable : Circuit Board Date : 9/29/xx Original Unit : Software Estimator : RMG WP Duration : 3 work weeks Total Budget $ : 265

49. Project Planning Once the outcome of the project has been defined, it’s important to develop a plan of what work needs to be done, what resources are needed, who will do it, and when. The level of detail needed in the plan will be determined by the complexity of the project and the number of people involved. The plan will probably not be followed exactly – things will happen that lead to adjustments and modifications.

50. Identify Parameters / Constraints Identify “Hot Spots” Steps for Project Planning Break the project into ‘hunks, chunks, and bites’ Write down the tasks in sequence Identify who is responsible for each item Determine when each task will be done Determine the projected cost