Project
§ Project – a
temporary endeavor to create a unique product, service or result (or
enhancement of existing services/products (e.g v.2 development is a
project) ) — may be collectively termed as deliverable — (vs ongoing operations which manage processes in transforming
resources into output) sometimes may involve handing over the deliverable to
the operation teams for continuous operation
§ Project drives changes in the organization and often is a
means to create business values and to achieve organizational goals —
the net quantifiable benefit derived from a business endeavour which
can be tangible or intangible.
§ Projects operate in an environment that may have
favourable or unfavourable impacts on them. Two major categories are:
§ Organization Process Assets is a major
input in all planning process, which may be kept at PMO, directly related to project management, includingProcesses and Procedures (including templates
(e.g. WBS, schedule network diagrams, etc.), procedures for
issuing work authorizations, guidelines, performance measurements)and Organizational Knowledge Repositories
§ Enterprise Environment Factors (often
are constraints) are influences not under control of
the project team that will affect the project, either intra-organization and extra-organization,
e.g. organizational culture, organization structure, existing human
resources, work authorization system, PMIS, market
conditions, legal requirements, technology
§ EEF are inputs for all initiating, most planning process,
not much in the executing/controlling process, none in closing process
§ Projects often involve more risks and uncertainties than
operations and thus require more planning
§ The following factors influence the operation of the
organization which may lead to the need for projects:
§ Regulatory/legal/social requirements changes
§ Stakeholders needs/requests
§ Changes in technology/business
§ Improvements, rectification and enhancements to
processes/products/services
§ Projects are Temporary, doesn’t mean short-duration.
§ Projects end when:
§ Objectives met
§ Objectives cannot be met
§ Funds are depleted
§ Need no longer exists
§ Resources no longer available
§ Legalities or convenience terminates the project
§ A project can be subdivided into phases, each phase is a collection of logically related
project activities that result in the completion of deliverable(s). Towards the
end of each phase is a “Phase Gate” which determines whether the project will
go on or not.
§ Process – a package
of inputs, tools and outputs, there are 49 processes defined
by PMI. Processes are grouped in the PMBOK® Guide into 5 Process Groups
(NOTE: Process groups are not the same as project phases).
§ Portfolio > Program > Project
§ Program – a group
of coordinatedprojects, taking operations into account,
maybe with common goals, achieving benefits not realized by running projects
individually, if only the client/technologies/resource are the same, then the
projects should be managed individually instead of a program
§ Portfolio – a group of
programs and/or projects to achieve organizational strategic goals within the
organization with a view to maximizing the value to the organization
§ Actively coordinating and managing portfolios, programs
and projects through organizational project management (OPM) best position the
organization to achieve strategic business goals.
§ Use of portfolio/program/project management to bridge the
gap between organizational strategy and business value realization
§ Project Portfolio management is a management process to
select the projects that should be invested in. Specifically, it is the
selection process based on the need, profitability & affordability of the
proposed projects.
§ The contract between the organization & the vendor
supersedes all the work related documents
§ Customers, internal or external, are the most important
stakeholders in a project.
§ Scope verification must take place at the end of each
phase
§ Money already spent on a project is called ‘sunk cost’
& should not be taken into consideration when determining if project should
continue. Instead the cost of work to complete is one of the elements that
should be taken into consideration when considering killing a project.
§ Phase end review are also called phase exits, milestones,
phase gates, stage gates or kill points
§ The project life cycle goes through a series of phases to
create the product.
§ Project managers manage things, but lead people.
Project Management
§ Project Management – the
application of (all appropriate) knowledge, skills, tools & techniques and
whatsoever to manage project activities with a view to meet the project requirements and achieve customer satisfaction
§ The most important task is to alignstakeholder expectations with the project
requirements, around 90% of the PM’s work is related to communication with stakeholders
§ PMBOK® Guide is a framework/standard but not methodology (agile, scrum,
PRINCE3, etc.) — A framework allows flexibilities while a methodology would
require the use of a predefined system of practices, techniques,
procedures and rules.
§ Project management emphasizes tailoring — selecting
the appropriate project management processes, inputs, tools, techniques,
outputs and life cycle phases according to the unique nature of each individual
project.
§ Competing constraints: Scope, Quality,
Schedule, Budget, Resources & Risks
§ Project Management Business Documents
§ Project Business Case — documents the economic
feasibility vs benefits of the project and is used for authorization of project
management activities.
§ Project Benefits Management Plan —describes how and when
the benefits of the deliverables of the project will bring and describes
how to measure the benefits (also including the alignment with organization
strategies, assumptions and risks)
§ Project Charter — authorizes the project and names the
project manager
§ Project Management Plan — how the
project will be performed and managed – documents assumptions
& decisions, helps communication between stakeholders, goals, costs & time scheduling (milestones),
project management system and subsidiary management plans and documents
§ Project Success Measures — project success is now more
inclined to be measured by considering the achievement of project objectives as
documented in this document
§ Project Management Life Cycle – IPECC
§ Project Life Cycle – Phases of Project
Role of the Project Manager
§ Project Manager: an
individual assigned by the organization to lead the team and is
responsible for achieving project objectives
§ is the leader of the
project irrespective of the authority
§ should consider every process to determine if they are needed
for individual projects (tailoring)
§ the exact role of project manager is to be tailored to
suit the needs of individual organizations and projects
§ may report to the functional manager, program manager,
PMO manager, operation manager, senior management, etc., maybe part-time or
devoted
§ identifies and documents conflicts of
project objectives with organization strategy as early as possible
§ Skills required of project managers:
§ Technical project management — process
tailoring, planning, managing schedule/cost/resources/risk
§ Leadership — communication (within team and with stakeholders), team
building, motivation, influencing, coaching, trust building, conflict
management, negotiation
§ Strategic and business management — be aware of the high-level strategies of the
organization and effectively implement decisions/actions that align with
strategic goals (Organization Strategy may be expressed through mission and
vision)
§ Project Manager must balance the constraints and
tradeoffs, effectively communicate the info (including bad news) to the sponsor
for informed decisions
§ Project Manager needs to involve project team members in
the planning process
§ Project Manager needs to perform integration at process
level, cognitive level and context level
§ Project Team includes Project Manager, project management
staff, project staff, PMO, SME (subject matter experts can be outsourced),
customer representative (with authority), sellers, business partners, etc.,
maybe virtual or collocated
§ Senior management must be consulted for changes to high-level
constraints
§ Leadership vs Management:
§ Lead: guide through interactive discussion from one point
to another
§ Manage: direct a person to perform a set of expected
behaviour
§ Leadership styles:
§ Laissez-faire – Hands off approach to project decisions
§ Transactional – Management by exception; Rewards &
punishments
§ Servant leader – focus on needs of Project team &
people served
§ Transformational – find innovative solutions; inspiring
& motivational
§ Charismatic – Do as I do
§ Interactional – coaching & motivational, hybrid type
of leadership
§ Types of Power
§ Positional – formal , authoritative
§ Informational – control of data gathering/ distribution
of info.
§ Referent – Respected/admired of past experiences.
§ Situational – certain situations in organization
§ Personal / Charismatic – personality that others like,
friendly demeanor
§ Reward – reward project team
§ Ingratiating – gains favor through flattery/ false power
§ Pressure based – restrict choices to Project team &
do work
§ Guilt based – make Team & SH feel guilty in order to
gain compliance
§ Persuasive – persuade people towards specific outcome
§ Avoiding Power – Refuses to act, get involved or make
decisions
Organization System
§ The organizational system determines the power, influence,
competence, leadership and political capabilities of the people who can act
within the system. e.g.
§ Management Elements — general management principles/rules
of the organization, e.g. disciplinary action, division of skills,
authorization model/practices, communication channels
§ Organizational Governance Frameworks —
framework/processes describing how authority within the organization is
exercised
§ Organizational Structure Types
§ Organic or Simple
§ Functional
§ Multidivisional
§ Matrix (Strong,
Balanced, Week)
§ Projectized (project
manager has the ultimate authority over the project, team members are often
collocated)
§ Virtual
§ Composite/Hybrid – a
combination of different types, depending on the actual need
§ PMO
§ Tight Matrix =
co-location, nothing to do with the
organization type (not necessarily a matrix org.)
§ Functional organizations
=> the project manager has little authority, often called project expeditor
(no authority) or coordinator (little authority), project coordination
among functional managers
§ Matrix organization => multiple bosses and more
complex
§ PMO- Project management office is an organizational unit to
centralize & coordinate the management of projects under its domain. A PMO
can also be referred to as a “program management office” or “program office”. A
PMO oversees the management of projects, programs or a combination of both.
§ Support Project managers
§ Manage & control shared resources/interdependence
across projects at the enterprise level
§ Coaching, mentoring & training
§ Conduction project audits
§ Developing & managing processes & procedures
§ Facilitating communications across projects
§ may function as a stakeholder / key decision maker (e.g.
to terminate the projects)
§ Types of PMO (lead the project as PM)
§ Supportive – consultative role, templates, training
§ Controlling – compliance through a framework, specific
forms & templates, governance
§ Directive – directly manages the project a PMO owns &
controls the project life cycle
§ play a decisive role in project governance
Project Life Cycle vs Project
Management Life Cycle vsProduct Life Cycle
§ Project Life Cycle: includes: initiating,
planning and organizing, carrying out/executing work, closing the project.
Project life cycles are independent of a product life cycle.
§ Within a project life cycle, there can be one or more
phases of the development of the product, service, or result (a.k.a.
development life cycles) with the following models:
§ Predictive [plan
driven/waterfall] – scope, time and cost determined early in the lifecycle, may
also employ rolling wave planning
§ Iterative – repeat the phases as understanding of the
project increases until the exit criteria are met, similar to the rolling wave
planning, high-level objectives, either sequential/overlapping phase,
scope/time/resources for each phase may be different
§ Incremental – features/scope are added to each
incremental cycle
§ Adaptive [change
driven/agile] – for projects with high levels of change, risk and/or
uncertainty, each iterative is very short (2-4
weeks), work is decomposedinto product backlog,
each with a production-level product, scrum is one of the most effective agile
methods, stakeholders are involved throughout the process, time and resources are fixed, allow low change cost/keep stakeholder influence high
§ Hybrid
§ The life cycle chosen must be suitable for the
intended deliverable and flexible enough to deal changes.
§ each project phase within the product lifecycle may
include all the five project management process groups
§ Product life cycle: development >
production > adoption & growth > maturity > decline > end of
life
Other Important Project
Management Terms
§ The Configuration Management
Knowledge Bases contain baselines of all organization standards
§ Lessons Learned – focus
on the deviancesfrom plan (baseline) to
actual results and how to solve these discrepancies
§ The work authorization system (WAS) is a
system used during project integration management to make sure that the
right work gets done at the right time
§ PMIS includes
configuration system and change control system
§ Never accept a change request to trim down one element of
the triple constraint without changing the rest.
§ Sponsor – provides
resources/support to project, lead the process through initiation
(charter/scope statement) through formally authorized, later involved in
authorizing scope/budget change/review
§ Customer – NOT necessarily provide the financial
resources, may be external to the organization, final
acceptance of the product
§ Business Partners –
certification body, training, support, etc.
§ Project Statement of Work (SOW):
describes the business need, high-level scope of deliverables and strategic plan of the
organization, created by the sponsor/initiator/buyer
§ Project Charter is not a contract
§ Project Management Plan is NOT a project schedule
§ Project Management System: includes a list of
project management processes, level of implementation (what actions to take in
the management processes), description of tools and techniques, resources,
procedures, change control system [forms
with tracking systems, approval levels]
§ Requirement Traceability Matrix (RTM) – a
matrix connecting deliverables to requirements and their sources (for managing scope)
§ Work Breakdown Structure (WBS) – a
hierarchal chart of decomposing deliverables into work packages
§ Activity List – a full
list of all activities with indication of relationship to the work packages
§ Activity Attributes – further
information (duration, start date, end date, etc.) of all the activities in the
list (for scheduling)
§ Roles and Responsibilities (RAR) – a document
listing all the roles and description of their responsibilities in the project
(often by category)
§ Responsibility Assignment Matrix (RAM) – a
matrix connecting people to work packages/activities, e.g. the RACI matrix
(responsible, accountable, consult, inform), usually only one person is accountable for
each activity
§ Resources Breakdown Structure (RBS) – a
hierarchical chart listing all the resources by categories, e.g. marketing,
design, etc.
§ Risk Breakdown Structure (RBS) – a hierarchical chart listing
all risks by categories
§ Project Management Data and Information
§ Work Performance Data – raw data
collected (Status - % complete/WIP/Start & Finish dates; Data – Cost of
activities/ no. of CRs/ Defects/ Durations)
§ Work Performance Info – analyzed in context
and integrated data, Useable info to make decisions, Status to actionable
results, e.g. some forecasts
§ Work Performance Reports – work
performance information compiled in communicable/ report format (Status
reports/memos/dashboards/project updates), helps SH make decisions
§ Sunk costs – money
already spent, not to be considered whether
to terminate a project, similar to committed cost (often through contracts)
§ Direct costs, indirect (shared) costs, Fixed costs,
Variable costs
§ Law of diminishing returns – beyond a
point, the more input, the less return
§ Working capital – assets
minus liability, what the company has to invest in the projects
§ Payback period – a time to
earn back capital investment
§ Benefit-cost ratio (BCR)
– an indicator, used in the formal discipline of cost-benefit analysis,
that attempts to summarize the overall value for money of a project
§ Depreciation – straight-line
depreciation vs accelerated depreciation (the amount of depreciation taken each
year is higher during the earlier years of an asset’s life)
§ Under double declining balance,
the asset is depreciated twice as fast as under straight line. Using the
example above, 10% of the cost is depreciated each year using a straight line.
Doubling the rate would mean that 20% would be depreciated each year, so the
asset would be fully depreciated in 5 years, rather than 10.
§ Under sum-of-the-years-digits,
the asset is depreciated faster than the straight line but not as fast as
declining balance. As an example of how this method works, let’s say an asset’s
useful life is 5 years. Adding up the digits would be 5+4+3+2+1 or a total of
15. The first year, 5/15 is expensed; the next year 4/15 is expensed, and so
on. So if the asset’s cost is $1000, 5/15, or $333.34 would be expensed the first
year, $266.67 the second year, and so on.
§ Economic value added – the value
of the project brought minus the cost of project (including opportunity costs)
e.g. for a project cost of $100, the estimated return for 1st year is $5,
assuming the same money can be invested to gain 8% per year, then the EVA is $5
– $100 * 8% = -$3
§ Net present value (NPV) – the sum of the present
values (PVs) of the individual cash flows of the same entity
§ Present value (PV) – or called present discounted value,
is a future amount of money that has been discounted to reflect its current
value, as if it existed today (i.e. with inflation, etc.)
§ Future value (FV) – is the value of an asset at a
specific date
§ Internal Rate of Return (IRR) – The inherent discount rate or investment
yield rate produced by the project’s deliverables over a pre-defined period of
time.
§ Forecast (future)
vs Status Report (current status) vs Progress Report (what have been done/delivered)
§ Journey to Abilene (Abilene’s Paradox) – committee decisions can have a paradox outcome, the
joint decision is not welcome by either party (because of fear of raising
objections)
§ when something unusual happens, always refer to the PM
Plan/Charter for instruction on how to proceed; if not found, ask for direction from the management
§ unresolved issues will lead to conflicts
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