The Project Management Process - Week 2

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  • + craigwbrown Craig Brown 5 months ago
    Hi Stephen

    The download should work for you. Maybe Slideshare were having problems when you were attempting to download.
  • + steven_sloan steven_sloan 5 months ago
    Great stuff Craig!

    Download doesn’t seem to work - maybe it’s not supposed to.....

    Steven
  • + guest1d0acc guest1d0acc 6 months ago
    i like your teaching style.....................
    god bless u........
    Viral @ Mit sydney
  • + shaua shaua 9 months ago
    Excellent
  • + guestf26f88 guestf26f88 10 months ago
    oh my God, thanks a million for this. I have always been looking for such a systematice presentation of the logical framework.
  • + craigwbrown Craig Brown 11 months ago
    Thanks Marco.
  • + rovatticonsulting Marco Rovatti 2 years ago
    Dear Craig,
    good works and clever texts.

    Nice meeting you onto this web-platform, Craig.

    A collegue,
    Marco (Italy + Swiss)
  • + craigwbrown Craig Brown 2 years ago
    THanks James
  • + JAMESSHAN JAMESSHAN 2 years ago
    Nice presentation
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The Project Management Process - Week 2 - Presentation Transcript

  1. Project Management 2. Portfolio Management
  2. Week 2
  3. Project selection and portfolio management
  4. Project selection and portfolio management
  5. Project selection and portfolio management What are the inputs that cause the project process to begin?
  6. Unit Objectives
    • Implement IT project planning and selection techniques
    • Appreciate the importance of project portfolio management
    • Strategic Planning
    • Identifying IT Projects
    • Project Proposals
    • Project Selection Methods
    • Applying a Selection Model
    • Project Selection
    • Project Success
    • Strategic Planning
    • Identifying IT Projects
    • Project Proposals
    • Project Selection Methods
    • Applying a Selection Model
    • Project Selection
    • Project Success
    • But first
    • Assignment 1
    • Assignment 1
    • “ Write a project plan”
    • Assignment 1
    • “ Write a project plan”
    • Topic: Week 3
  7. http://www.teachers.ash.org.au/ researchskills /Dalton. htm
    • Back to the programme…
  8. Strategic Planning
  9. Strategic Planning
    • What is strategy?
    • How do projects relate to strategy?
  10. Strategy 2 Strategy 1 Strategy 3 Strategy 4 Organisation Mission Money Customers Efficiency and Effectiveness Adaptability
  11. 5 Forces analysis Supplier power Customer power Threat of New Entrants Substitutes Intensity of competition Michael Porter’s ‘5 Forces’ – 1980’s
  12. business model template VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIP TARGET CUSTOMER DISTRIBUTION CHANNEL VALUE CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS INFRASTRUCTURE CUSTOMER OFFER FINANCE Osterwalder’s Business Model framework 2006 http://business-model-design.blogspot.com
  13. Process efficiency Scorecard Customer satisfaction Financial Learning and innovation Balanced Scorecard Kaplan & Norton (1994?) HBR
  14. Kaplan & Norton (1998?) HBR http://www.visual-literacy.org/periodic_table/pix/strategy-bsc-map.png Strategy Map
  15. Strategy 2 Strategy 1 Strategy 3 Strategy 4 Organisation Mission Money Customers Efficiency and Effectiveness Adaptability
    • Strategic Management Overview
      • Involves determining long-term objectives, predicting future trends, and projecting the need for new products and services
      • Provides the theme and focus of the future direction for the firm
        • respond to change
        • allocating scarce resources
      • Requires strong links among mission, goals, objectives, strategy, and implementation
  16. Set (SMART) Goals Review Mission Develop Strategies Implement Strategies through projects Align Strategies to goals
  17. Set (SMART) Goals Review Mission Develop Strategies Implement Strategies through projects Align Strategies to goals
  18. SWOT Analysis
    • SWOT = SITUATIONAL ANALYSIS
    • Where are we now?
  19. S T W O
  20. S T W O Positive Negative
  21. S T W O Internal External
  22. S T W O Internal External Positive Negative
  23. S T W O Internal External Positive Negative
  24. Set (SMART) Goals Review Mission Develop Strategies Implement Strategies through projects Align Strategies to goals
  25. http://en.wikipedia.org/wiki/SMART_(project_management) Time-bound T Relevant R Achievable A Measurable M Specific S
  26. http://en.wikipedia.org/wiki/SMART_(project_management) Recorded, Rewarding, Reviewed [8] R [1] Exciting, Evaluated, Ethical E [1] Time framed [2] , Timed, Time-based, Timeboxed, Timely [6] [5] , Timebound, Time-Specific, Timetabled, Trackable Time-bound T Realistic [2] , Results/Results-focused/Results-oriented [6] , Resourced [7] , Rewarding [3] Relevant R Agreed, Attainable [6] , Assignable [2] , Appropriate, Actionable, Action-oriented [3] Achievable A Meaningful [3] , Motivational [3] , Manageable Measurable M Significant [3] , Stretching [3] , Simple Specific S Minor Terms Major Term Letter
    • Examples of “not smart” goals?
  27. Set (SMART) Goals Review Mission Develop Strategies Implement Strategies through projects Align Strategies to goals
  28.  
  29. Set (SMART) Goals Review Mission Develop Strategies Implement Strategies through projects Align Strategies to goals
  30. Organisation Mission Money Customers Efficiency and Effectiveness Adaptability Strategy 2 Strategy 1 Strategy 3 Strategy 4
  31. Set (SMART) Goals Review Mission Develop Strategies Implement Strategies through projects Align Strategies to goals
  32. Organisation Mission Money Customers Efficiency and Effectiveness Adaptability projects projects projects projects Strategy 2 Strategy 1 Strategy 3 Strategy 4
    • What are the goals of the projects?
  33. Figure 2.1 Strategic Management Process (Gray & Larson, 2006, p25)
  34. projects
  35. projects projects projects projects
  36. projects projects projects projects projects projects projects projects projects projects projects projects
    • PPPM
    • Project
    • Programme
    • Portfolio
    • Management
    • The ‘O’ is for
    • Organisational
    OPM3
  37. Programme OPM3 Portfolio Projects
  38. Projects Programme Portfolio Project Programme Project Project Projects Project Project Projects Project Project Projects
  39. One Portfolio or Several? Categories Approaches to project portfolio management
  40. One Portfolio or Several?
  41. Categories Venture: Projects that transform the business Growth: Projects that grow revenue or market share Core: Projects that help run the business
    • What are the benefits of Project Portfolio Management?
    • Builds discipline into project selection process
    • Links project selection to strategic metrics
    • Prioritizes project proposals across a common set of criteria, rather than on politics or emotion
    • Allocates resources to projects that align with strategic direction
    • Balances risk across all projects
    Benefits of Project Portfolio Management
    • Problems with Project Portfolio Management
  42. Different views from senior management on what (and how) should be done
  43. Competition (& effective utilisation) for resources
  44. How to
    • Senior Management Input
      • provide guidance in selecting criteria that are aligned with the organization’s goals
      • decide how to balance available resources among current projects
    • The Priority Team Responsibilities
      • publish the priority of every project
      • ensure selection process is transparent
      • re-assess the organization’s goals / priorities
      • evaluate the progress of current projects
  45. Figure 2.8 Sample project portfolio approach (Schwalbe, 2005, p51)
  46. Figure 1.5 Project management compared to project portfolio management (Schwalbe, 2005, p15)
  47. Money Customers Efficiency and Effectiveness Adaptability projects projects projects projects projects programme projects projects projects projects programme projects Strategy 2 Strategy 1 Strategy 3 Strategy 4 Organisation Mission Programme projects projects programme
  48. Short term Mid term Long term projects projects projects projects projects projects projects projects projects projects projects projects Strategy 2 Strategy 1 Strategy 3 Strategy 4 Organisation Mission projects projects projects projects
  49. http://www.betterprojects.net/search?q=strategy
  50. projects projects projects projects projects projects projects projects projects projects projects projects Strategy 2 Strategy 1 Strategy 3 Strategy 4 Organisation Mission projects projects projects projects
  51. Identifying IT Projects
  52. Identifying IT Projects
    • Many organizations follow a planning process for selecting IT projects which is aligned with business strategy
    • Research shows:
      • Supporting business objectives is the number one reason for investing in IT projects
      • Use of IT standards lowers development costs by 41 percent per user (Cosgrove Ware, 2002)
  53. Figure 2.1 Pyramid for the Project Selection Process (Schwalbe, 2005, p35)
  54. Project Proposals
  55.  
  56. Most business units have a strategic plan
  57. Which SHOULD align with the organisation’s strategic plan Which SHOULD align with the organisation’s strategic plan
  58. Solicitation of Project Proposals
      • Within the organization
      • Request for proposal (RFP) from external sources (contractors and vendors)
    • When ranking proposals, consider;
      • Discipline
      • Accountability
      • Responsibility
      • Constraints
      • Reduced flexibility
      • Loss of power
  59. Project Initiation forms Figure 2.4B Risk Analysis (Gray & Larson, 2006, p39) Figure 2.4A Major Project Proposal (Gray & Larson, 2006, p38)
  60. Project Initiation forms Figure 2.4B Risk Analysis (Gray & Larson, 2006, p39) Figure 2.4A Major Project Proposal (Gray & Larson, 2006, p38)
  61. Project Selection Methods
  62. Not all project proposals make it to initiation
    • Every project idea isn’t progressed.
    • Why?
    • Time
    • Money
    • Focus
    • Methods for selecting projects include:
      • Focusing on broad organizational needs
      • Categorizing IT projects
      • Financial analysis
      • Using a weighted scoring model
      • balanced scorecard
      • Strategy mapping
    • Focusing on Broad Organizational Needs
      • E.g. Non-financial, but important benefits
      • Three important criteria:
        • need for the project
        • funds available for the project
        • will to make the project succeed
    • Categorizing IT Projects
      • Does the project provides a response to:
        • a problem
        • an opportunity
        • a directive
      • The time and date of expected completion
      • The overall priority of the project
  63. Financial Analysis $$$ Net Present Value Payback model Return on Investment (there are more)
  64. Financial Analysis $$$ Net Present Value Payback model Return on Investment (there are more)
  65. Net Present Value
    • Net Present Value (NPV) Model
      • Uses management’s minimum desired rate-of-return (discount rate) to compute the present value of all net cash inflows
        • positive NPV: the project meets the minimum desired rate of return and is eligible for further consideration
        • negative NPV: project is rejected
    • Net Present Value (NPV) Model cont’d…
      • NPV Calculations
        • determine estimated costs / benefits for the life of the project and products it produces
        • determine discount rate (ask organization)
        • calculate the NPV
        • some organizations consider the investment year as year 0, others consider it year 1
        • some organizations enter costs as negative numbers, others do not (ask organization)
    • Example: CP829_Lecture_Week2_NPV.xls
    Time to Stop and turn to a new presentation pack
  66. Payback model Figure 4.1 Charting the Payback Period (Schwalbe, 2006, p129)
    • Measures the time it will take to recover the project investment
    • Shorter paybacks are more desirable
    • Payback occurs when cumulative discounted benefits and costs are greater than zero
    • Limitations of payback:
    • ignores the time value of money
    • assumes cash inflows for investment period only
    • does not consider profitability
  67. Return on Investment
    • Return on Investment (ROI)
      • Calculated by subtracting project costs from the benefits and then dividing by the costs
      • Formula:
        • ROI = (total discounted benefits – total discounted costs) / discounted costs
      • Higher the ROI, the better. Many organizations have a set or minimum rate of return on investment projects
      • Example: CP829_Lecture_Week2_ROI.xls
    (total discounted benefits – total discounted costs) discounted costs
  68. Non-financial Analysis $$$ Weighted scoring model Balanced Scorecard
    • A weighted scoring model is a tool that provides a systematic process for selecting projects based on many criteria
      • Steps in identifying a weighted scoring model:
        • identify criteria for project selection
        • assign weights (%) to criteria add up to (100%)
        • assign scores to each criteria for each project
        • multiply scores by weights to get total scores
      • The higher the weighted score, the better
      • Example: CP829_Lecture_Week2_WeightedScore.xls
    $$$ Weighted scoring model $$$
    • Balanced Scorecard
      • Robert Kaplan and David Norton developed this approach to help select and manage projects that align with business strategy
      • Methodology that converts an organization’s value drivers, such as customer service, innovation, efficiency, and financial performance, to a series of defined metrics
      • See http:// www.balancedscorecard.org for more information
    $$$ Balanced Scorecard $$$
  69. Applying a selection model
  70. Applying a Selection Model
    • Project Classification
      • Deciding how well a strategic or operations project fits the organization’s strategy
    • Selecting a Model
      • Focus on competitive strategy and broad organizational needs
      • Perform net present value analysis or other financial projections
      • Use a weighted scoring model
      • Implement a balanced scorecard
      • Address problems, opportunities, and directives
      • Consider project time frame
      • Consider project priority
  71. Project Selection
  72. The Business Case
    • Impacts
    • Costs & Benefits
    • Clearly compares alternatives
    • Objective
    • Systematic
  73. The Business Case
    • Elevator pitches?
  74. Table 3.4 Sample business case (Schwalbe, 2005, pp74-76) Example business case
  75. Contents of a Business Case
    • Introduction/Background
    • Business Objective
    • Current Situation and Problem/Opportunity Statement
    • Critical Assumptions and Constraints
    • Analysis of Options and Recommendation
    • Preliminary Project Requirements
    • Budget Estimate and Financial Analysis
    • Schedule Estimate
    • Potential Risks
    • Exhibits
  76. Figure 2.3 The Process for Developing a Business Case (Marchewka, 2003, p34)
  77. Project Success
    • By the way,
    • Things are getting better
    • Source: CHAOS Report 1995 by the Standish Group
    • Access it here: h ttp://net.educause.edu/ir/library/pdf/NCP08083B.pdf
    Not even completed Typically 189% over budget OTOBOS 53% Challenged 16% Success 31% Critical Failures 1994
    • Source: CHAOS Report 2002 by the Standish Group
    • Access it here: http:// www.standishgroup.com/quarterly_reports/index.php
    Not even completed Still way over budget OTOBOS 51% Challenged 34% Success 15% Critical Failures 2002
  78. 53% Challenged 16% Success 31% Critical Failures 1994 51% Challenged 34% Success 15% Critical Failures 2002
  79. 1994 2005 Wasted money as a share of total project spend Billions of dollars
  80. What happened?
    • “ The reasons for the increase in successful projects vary. First, the average cost of a project has been more than cut in half. Better tools have been created to monitor and control progress and better skilled project managers with better management processes are being used. The fact that there are processes is significant in itself.” (Standish Group cited in Schwalbe, 2004, p13)
    • “ The reasons for the increase in successful projects vary. First, the average cost of a project has been more than cut in half. Better tools have been created to monitor and control progress and better skilled project managers with better management processes are being used. The fact that there are processes is significant in itself.” (Standish Group cited in Schwalbe, 2004, p13)
    Smaller projects Better tools Better training
  81. Better Selection Portfolio Mgt Strategic Alignment More recently
  82. Things you should have (if you want to succeed)
    • Executive support
    • User involvement
    • Experienced project manager
    • Clear business objectives
    • Minimized scope
    • Standard software infrastructure
    • Firm basic requirements
    • Formal methodology
    • Reliable estimates
    • Other criteria, such as small milestones, proper planning, competent staff, and ownership
    • inc rem en tal
    But, change has been…
    • There is still plenty of room for improvement.
    • ?
    What do you think is still going wrong?
  83. BetterProjects.net
    • Title page pic care of jpellqen & CC @ Flickr
    • http://flickr.com/photos/jpellgen/444946201/

+ Craig BrownCraig Brown, 2 years ago

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