Project Manual


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Project Manual

  1. 1. Project Manual Prepared for: Vittal S. Anantatmula DSc MS MBA PMP CCE Prepared by: Joseph Lynn November 9, 2010 Western Carolina University Cullowhee, NC 28723
  2. 2. Table of Contents Executive Summary 1 Objective 1 Intended Use 1 How to Use 2 Scope 2 Communications 3 Stakeholder Management 3 Communications Plan & Information Distribution 4 Change Management 4 Performance Reporting 4 Scope 5 Project Charter 5 Requirement Management Plan 5 WBS & WBS Dictionary 5 Define Scope & Outside of Scope 6 Mile Stones 6 Schedule Development 7 Find Dependencies & Sequence Activities 7 Duration Estimates 7 Project Schedule & Baseline 8 Cost Management 9 Budget 9 Cost Estimating 9 Control Cost 10 Quality Control 11 Quality Management Plan 11 Quality Audits 12 Project Performance 12 Lessons Learned 13 Western Carolina University Cullowhee, NC 28723
  3. 3. Risk Management 14 Risk Identification 14 Risk Management Plan 14 Risk Register 14 Risk Data & Audit 15 Contracts & Procurement 16 Select Sellers 16 Procurement Plan 16 Contract 16 Project Acceptance 16 Project Closure 16 Team Development 17 Formation 17 Leadership 18 Empowerment & Delegation 18 Influence 19 PM Office Integration 20 Develop Standards 20 Training & Mentoring 20 Support 20 Appendix 21 Charter Example 21 AON & AOA 23 Forward & Backwards Pass 23 Selection Criteria Example 24 Western Carolina University Cullowhee, NC 28723
  4. 4. Executive Summary Objective To create a project manual that incorporates best practices for either organizations or individuals who are not entirely familiar with the tools necessary to complete a successful project. A successful project is defined as a non-reoccurring activity that produces results under budget, on time, and within the decided framework. The manual will be as simple as possible and must be able to be used by novice to project management. The goal of this manual is to take complex ideas and make them simple enough that anyone can manage a relatively small project with little experience. Intended Use This manual is intended for organizations or individuals who do not have a permanent project management office or process. It is for entities that for any reason do not currently have a project management process or method and may not have the desire to create one. The manual will focus on what it takes to complete a project and will provide the basic tools for such a use. It is not a complete document of all the tools and methodologies for project management. If the entity using this manual were to decide to create a permanent project office it would be advised to only use this manual as a base and to incorporate more detailed tools & methods to fit the various needs of different projects. The idea is that an entrepreneur or the like will need to manage a project, yet will not have the resources to hire a professional project manager or may not need one. This can work as a ‘do-it- yourself’ guide for such a person. How to Use The manual is, more or less, in the order of importance. While at some points of the project the project manager will need to either skip ahead or move back within the manual, the order in which activities need to be done are as chronological as possible given the complex nature of managing the unknown nature of many projects. Using this manual, a project manager would want to read through it first. Then, begin at the start and work on completing the steps necessary to work through the project. Project management has two extremely important aspects on which this manual will focus: Planning and Communication. While communication has it’s own section planning, it is equally important. Much of the documentation is about planning for the project. The goal of project management is to limit risk of the unknown through planning and communication. Project Manual 1
  5. 5. Scope As mentioned above, the goal of this manual is to make project management accessible to anyone who may need it for a given project. It will not be a comprehensive document. It will also not necessarily help with the PMP certification. The document will include communication and planning methods for project. Initiating, Executing, Monitoring & Controlling, and Closing processes are to be covered although not in as great of detail as planning and communications. Project Manual 2
  6. 6. Communications A project manager (PM) must be good at stakeholder management & preparing for the unknown. Planning is a process that can be taught and perfected through repetition. Communication is a continuously improving process that one must practice daily; yet must be discussed in any PM guide. Stakeholder Management . Stakeholder management and communication are two of the most important aspects of managing any project. The project manager’s job is to facilitate communication, manage the risk of uncertainty, and manage stakeholder’s expectations. While there is a good deal of technical information surrounding managing uncertainty, and there is even some technical consideration for communication most of communication and stakeholder management are abstract principles that must be practiced daily. Any person’s communication skills and stakeholder understanding will be done in small increments on a daily basis. Project Manual 3
  7. 7. Communication Plan & Information Distribution Use the Stakeholder Identification & Strategy Template to determine who needs to be communicated with. The Communication plan will determine how, and how often. While the template below can be used it is mostly to give the user a general idea of what is needed. Separating the forms into different list might be a better method. It is up to the user. Like with all of the templates and suggested documentation methods in this manual remember to use what is needed and to adjust it based on your own projects needs. For some projects it might be better to add a communication log to track who is getting what and when, while other projects may only need to know who is responsible for what. Stakeholder Identification, Strategy Template & Communication Name: Contact Info Position or Role Influence Strategy: Com. Method How Often Message Notes Change Management Any changes to the cost, schedule, quality, or scope of the project must be reported and managed. A change management plan must consist of a definition of change, a reporting method, which is responsible for accepting change, and a method for accepting or denying said change. The important part of change management is to ensure that all change is submitted and approved in writing. This prevents more than just future communication issues it also protects against legal issues. A policy of documentation provides leadership with the necessary authority expected in the legal world. Performance Performance needs to be followed and understood. Measuring performance not only to ensure the project is on target, it also allows for recognition of excellence among team members. There must be team assessments, contractor assessments, and project assessments. These reports can be combined into a single document, be separated into more detailed individual documents, or be very informal. It is suggested that there be some sort of standardized process for evaluating performance especially when it comes to the people involved in the process. This ensures that biased is limited to work results and not personal feelings. It is not uncommon for one of the better team members to not have the best relationship with the leadership while a less productive member to have a great relationship with leadership. Both of their evaluations must be as performance related as possible. Project Manual 4
  8. 8. Scope Project Charter The project charter gives the authority to the project manager and allows for resources to be used on the project. It outlines high-level requirements, budgets and describes the projects. (See Appendix 1 for an example of a Project Charter.) The Project Charter is one of the most important documents in the project management process because it authorizes the project and lays out the framework for the basic plan. Simply put the Project Charter is the foundation that the rest of the project is built. Requirement Management Plan At this point it is time to decide what is required of the project. The actual deliverables should be decided upon at this point. A deliverable is anything that is to be created, or completed as the result of the work being done. Prioritization is possible during this part of the planning, but it can also be done later during the scheduling process of the project. Work Breakdown Structure & WBS Dictionary The Work Breakdown Structure or WBS is a hierarchical decomposition of deliverables. The WBS should begin with the deliverable followed by the work necessary to complete the deliverable. The people who will be completing the work best decide upon work packages. 1.0 Widget 1.1 Build Widget 1.1.1 Materials 1.1.2 Tools 1.2 Widget Design 1.2.1 Scope Or Project Manual 5
  9. 9. WBS Dictionary The WBS Dictionary gives greater detail into the work packages. It allows for further description on work, cost, and schedule requirements for given work packages. WBS Name & ID: Due Date: Description of Work: ID Activity Labor & Materials Total Cost Acceptance Criteria Relevant Information Define Scope Scope is what the project is intended to complete. It is easier to define the scope after the completion of the WBS because it will give an clearer idea of what is not going to be done by the project as well as what is to be done. By deciding that certain things will not be considered part of the project initially it will help to keep the project from growing beyond the desired results of the project. This is typically called ‘scope creep.’ The scope is the sum total of the project. It is similar to the goal of the project. If the project were intended to ‘work on landscaping,’ then the scope would be ‘any outside landscaping on our property.’ Anything outside of be ‘any outside landscaping on our property’ would be considered outside of scope. IE: Panting the deck. Details outside of scope should be mentioned so that it does not become part of the project later. This often leads to ‘scope creep.’ Mile Stones Mile Stones are major events that give important stakeholders a reference point as to the projects progress. Going back to our yard example mile stones could be:  Mow the lawn  Trim the bushes  Water the Flowers After each objective is met then a milestone is complete and the project is closer to completion. Project Manual 6
  10. 10. Schedule Development Find Dependencies & Sequence Activities The first part of developing the schedule is to find dependencies. Simply put this means putting work that must be done before another task first. There are three kinds of dependencies: 1. Mandatory Dependencies: Dependencies that must occur before a task can be begun. An example would be the foundation must be in place before the walls can go up in a house. 2. Discretionary Dependencies: Dependencies that the project team would like to see for whatever reason. An example would be painting a room before the carpet was laid. 3. External Dependencies: Outside factors that must occur before the task can begin. An example would be delivery of drywall has to happen before the drywall can be put in place. After all the dependencies are realized it becomes much easier to sequence the activities. Activities can be sequenced using the following document: Network Data Activity WBS Activity Name Predecessor(s) Duration Estimates Typically there are three ways to estimate task duration. These include Parametric, Analogous, and Three Point Estimates. For our purposes we will focus on the last two: Analogous and Three Point Estimates. Analogous Estimate WBS ID Previous Activity (PA) Previous Duration (PD) Current Activity (CA) CA/PA=M PD*M Duration Estimate 1.1 160 Sq ft 10 days 200 Sq ft 200/160=1.25 10*1.25 12.5 days Three Point Estimate WBS ID Optimistic Duration (O) Most Likely (M) Pessimistic Duration (P) (0+4M+P)/6 Duration Estimate 1.1 10 days 12.5 days 17days (10+4*12.5+17)/6 12.83 Days Project Manual 7
  11. 11. Project Schedule & Baseline Now the schedule will be developed. Often times what is known, as a Gantt chart will be used to show the project schedule. Typically this is done using various project management software. If no software is available using the network diagram will work just as well. Bellow is an example of both Activity-on-node and Activity-on-arrow diagrams (See Appendix 2). The darker arrows represent the critical path, or the path of task within a given project that cannot go part their scheduled duration or it will affect the entire projects duration. ES is the early start or the earliest the task can begin. D is duration while S is slack or amount of time that is ‘free’ for the task and will not affect the entire project. EF is early finish or the earliest the task will be finished while LS and LF represent the latest times that the task can go before they begin to delay the project. (Appendix 3 for formulas) Project Manual 8
  12. 12. Cost Management Budget The total amount that is available for the project. A budget should be made after the cost estimates are complete to ensure that the project can and will be adequately funded. Cost Estimating Like duration estimates cost estimates uses Parametric, Analogous, and Three Point Estimates but cost estimates also has a fourth-Bottom-up Estimates. Parametric Estimate WBS ID Cost Variable Per Unit Cost Number Of Units Estimate 1.1 Sq ft $12.50 16 $200 Analogous Estimate WBS ID Previous Activity (PA) Previous Cost (PC) Current Activity (CA) CA/PA=M PC*M Estimate 1.1 220 Sq ft $3,500 300 300/220=1.36 3500*1.36 $4,773 Three Point Estimate WBS ID Optimistic(O) Likely(M) Pessimistic(P) (0+4M+P)/6 Estimate 1.1 $3,500 $4,773 $5,680 (3500+4*4773+5680)/6 $4,712 Project Manual 9
  13. 13. Bottom-up Cost Estimates attempts build the cost up from all relevant information. It takes all the resources that are going to be used in the task or project and adding them together to arrive at an estimate. WBS ID Labor Cost Material Supplies Equipment Direct Cost Indirect Cost Reserve Total Control Cost In order to ensure that the project is running under budget cost must be measured and controlled. It is ideal to develop a cost baseline that tells the project manager and anyone who needs to know exactly where the project is in terms of budget. Project management borrows some ideas from accounting and finance to measure and control cost. Earned value is a system that is able to show cost variance and allow for a project manager to know when and how to correct any variance. Earned value also shows any schedule variance. Used in combination the PM can see if the project is ahead of or behind schedule and cost. Below is a list of formulas used in earned value. They are not too terribly difficult so long as one understands the projects budget, planned schedule, and planned cost. Project Manual 10
  14. 14. Quality Control Quality Management Plan In project management there are what is called the ‘Iron Triangle’ or the “Triple Constraints.’ Both names are a name for the relationship of cost, time, and scope. One cannot be changed without affecting another. Now it is widely understood that there is a fourth part to the ‘triangle’ called quality. While the quality of the good or service can be adjusted to reduce any of the other three constraints it is strongly not advised. Quality should be planned for. It is quicker, cheaper, and easier to do something right the first time than it is to redo the work to get it right. A quality management plan must include a section that states who is responsible for what, a way to ensure quality, to control quality, and to improve quality. The quality plan is a forward- looking method to understand the needs of the project from a perspective that eliminates rework and waste. Project Manual 11
  15. 15. Quality Audit A quality audit is a way to independently review any part of the project or project elements. The audit should give the reader an idea of what is working and what needs improvement. It should also give descriptions of defects and deficiencies. Project Performance Measuring project performance has many different methods. The easiest is the Earned Value method that was discussed on page 10 under the Cost section. In order to measure a projects performance a baseline is necessary. A baseline is essentially what is expected at this point in the project. Other performance measurements should include team assessments, and contractor assessments as well as project assessments. Below is a quick form that can be expanded upon as needed to monitor performance. Project Manual 12
  16. 16. Project Performance Project Title: Date: Contractor & Team Information Earn Value Report Mile Stones Completed: Mile Stones Missed: Interpersonal Performance: Schedule EV: Upcoming Mile Stones: Impact Of Misses: Technical Performance: Cost EV: Planned Preventions: Causes: Disputes/ Issues: Corrective Action: Notes: Lessons Learned Lessons learned are a way of documenting issues & successes for future reference. One of the important aspects of Project Management is the continued growth of the PM and Project Management Office. If this ends up being the only project that is completed a lessons learned may not be as important, but it should be noted that there is always the possibility of future projects. A key to lessons learned is the ability to review the results when needed. This is why it should be documented. Positive Results Needs Work Scope Time Cost Quality Communication Stakeholder Management Team Development Vendor Management Vendor Issue Resolution Comments Comments: Project Manual 13
  17. 17. Risk Management Risk Identification The first part of risk management is to identify risk. This is done trough brainstorming and putting the information into a spreadsheet. Risk ID: Risk: Impact On: Comments: Risk Management Plan The Risk Management Plan is were the methods of dealing with potential risk is decided upon. Remember risk can be positive or negative. Risk can either be accepted, transferred, avoided, or mitigated if it is negative. Positive risk can be shared, exploited, or enhanced. Whatever risk strategy is chosen the type of risk must be understood first. Since project management is the management of risk due to uncertainty it is best to learn to understand risk identification. A risk management plan should identify approaches to dealing with risk the probability of the risk occurring, who is responsible for the risk, impact, risk tolerance, contingency plans & funds, and any other relevant information regarding the managing of risk. Risk Register Risk ID Statement Probability Impact Score Response 1, 3, or 5 1, 3, or 5 P*I= For the scores it is best to only use three numbers to give a risk assessment of low, medium, or high. It is more accurate this way and does not force the person or persons identifying the risk to over think the results. So, a 1, 3, or 5 would be great identifiers. After Risk Strategy Risk ID Probability Impact Score Actions Status Comments 1, 3, or 5 1, 3, or 5 P*I= The results are then placed into the Probability Impact Matrix. A Probability Impact Matrix is a great way to give visual aid to the likelihood that an event will occur and the impact of such an event. Project Manual 14
  18. 18. Risk Probability Impact Matrix Low Probability ----------------Medium Probability---------------High Probability HighMediumLow Impact Risk Data & Audit Risk assessment must be revisited periodically to ensure that the event is being managed properly. A complete data sheet can give the PM a base to begin the risk audit. Periodically reviewing the data and assessing the probability of the event occurring plus finding any new risk factors is key to the projects success. Risk Data Sheet Risk ID: Description: Status: Cause: Probability Score: Responses: Person Responsible: Actions Taken: Residual Risk Contingency: Comments: Project Manual 15
  19. 19. Contracts & Procurement Select Sellers Selecting contractors is one of the most important aspects of procurement. It consists of deciding upon parameters for what is needed from the contractor to what is the weighted value for selecting a contractor. Price is arguable the most import part of the selection process, but it MUST NOT be the end all reason for the decision. Just because one entity is the cheapest does not mean that said entity is the best or even a good fit for what is needed. (See Appendix 4 for example) Procurement Plan The Procurement Plan outlines who is responsible for what part of the procurement process. IE: Who can authorize work, contracts, or any other legal requirements. It can include selection criteria, and standard documentation. Assumptions and constraints should be mentioned here along with any specific requirements. Contract Contract Type Risk Fixed Price Seller Fixed Price W/ Price Adjustments Seller Fixed Price W/ Incentive Shared Cost Plus Fixed Fee Buyer Cost Plus Incentive Shared Time & Materials Buyer Project Acceptance Criteria At this point it must de decided what would make the project a success. Once this is decided and completed a formal close out must be completed where people and resources are released. Project Manual 16
  20. 20. Team Development Effective team building comes from continuous effort and practice. Teams are not built overnight and neither are effective leaders. It must be practiced and developed much like Total Quality Management. Formation It is typically accepted that teams go through a four-phase process. Project Manual 17
  21. 21. Leadership Leadership is all about what a project manager’s job is. PM’s typically have little formal power in comparison to functional managers. Being a strong leader includes a combination of skills including influence. Credibility and establishing goals are two other important aspects of being a leader. Credibility comes from developing integrity, clarity, staying positive, and finding commonality (Whetten & Cameron). Integrity simply means holding true to one’s own values- practicing consistency. If this is done with a clear and positive message, people will want to listen making it easier to develop common grounds with team members. If the team helps to develop the goals, this common ground should be based on maintaining focus on the goals. Goals must be established to give the team direction. Goals must be developed with the team and be difficult yet obtainable. Goals need to be measurable, have completion dates, and be realistic. Managing agreements as well as disagreements is also important. Too often PM’s want to avoid disagreements, yet this often will undermine their image of a strong leader. Leaders are not afraid of comflict and know how to manage it. Empowerment & Delegation There is nothing more important to working in a team environment than empowerment. When given the trust and freedom to work independently, informed, and in control of their given environment, people will produce amazing things. Kazien quality control has proved this in even the most mundane task. The key to empowerment is trust. This trust must be mutual. Besides trust, there are five total dimensions of empowerment (Whetten & Cameron): • Self-efficacy: The team must feel qualified for the task. If the task seems too difficult, it will become dishartening. • Self-determination: The team must be involved in the decision making process • Personal Consequence: The team members must be obligated to each other. People are much more faithful to concrete co-workers than abstract corporations. • Meaning: The work needs to be perceved as having value to the overall project. Often times, the meaning of important task get lost. Team members must understand their roles are valid and valued. • Trust: The team must believe in their personal stability. The team must also believe in the methodology being implemented and it must remain consistent on certain levels. Empowerment is the first step to reducing controls and then quickly after, Delegation comes. Through delegation the project manager assigns tasks to team members to complete. The team must be involved in the processes. Like the people who are to do a given task should create the WBS, when work is delegated it must be delegated with the team’s involvement. The task must be delegated completely with the final goal in mind. For a project, this final goal can be their specific deliverable or it can be from a bigger perspective like corporate goals. Either way, the goals must be defined. Once this happens, the focus can shift towards accountability, results, and consequences. If the PM is consistent in his or her approach to delegation, the team will develop trust in the system and continue to grow within it. Project Manual 18
  22. 22. Influence Reciprocity This is really a statement about the old saying ‘what goes around comes around.’ If one does good things, he or she will receive good things in return. If not they will not. It turns out we are hardwired to do this. When someone gives another something, even if it is only a small token, that person will instinctually feel the need to return the favor. Commitment & Consistency People want to do what they say especially if they put it in writing. Even if an individual does not completely believe what they are stating once they state it they are much more likely to want to follow through with it. Social Proof This speaks to people’s need for group belonging. When a person knows that someone else is doing something or acting in a certain way, they will be more likely to follow along. This means that team members will act as they see other team members acting. Individuals will tend to believe that the way to behave is as such. Authority Individuals in a perceived position of power they are thought to be experts. Being in a position of power could simply mean an expert on a subject, or it could mean absolute power. Either way people will act according to their perception of power. Liking When someone is liked, others will be more apt to do what they ask. This one is fairly obvious in that one is more receptive to people that they find pleasurable much more than otherwise. Scarcity If an object is thought to be limited, humans instinctively begin to react with panic. Humans want more of what they cannot have. Again, this is hardwired into our instincts. Like the other means of influence, it helped people to develop groups and react to hardships better. In today’s society, scarcity can still be used to influence people’s actions. Project Manual 19
  23. 23. P.M. Office Integration Develop Standards If it is decided that project management is a useful asset to your institution or group than standards must be developed. One of the keys to long-term successful project management is the ability to learn from past mistakes and repeat successes. This is done through developing of standards. Standard documentation is one way to ensure that standards are met. Training & Mentoring Training and mentoring new project managers also helps in creating a standard. Since the goal is to produce repeatable successes using mentoring programs to train new or less experienced project managers is completely necessary. Support Support comes from organizational support. It is about more than just financial support. Support means a dedication to developing a mature projectized organization that uses standards procedures for success in combination with training and mentoring. It means allow project manager to give input into what works within the organization and what does not. Project Manual 20
  24. 24. Appendix 1 Project Charter Example Objective The purpose of this project is to obtain a working restaurant in Arizona. The business need is for both an investment and employment. Description In the great Mesa, AZ area there are multiple food service establishments available. The long- term plan of running and establishing a profitable restaurant business begins with the selection, purchasing, and improving an existing restaurant concept. Requirements Obtaining and opening a working food service establishment within the parameters laid out in the project plan. Acceptance Criteria The project is complete upon the opening of the establishment to the general public as customers. Initial Risk Risk Identification Loan acquisition Staffing Issue Lease Agreements Previous Owners Name Construction Flaw Not Finding Location Government Regulation Tax Estimates Insufficient Capital Inadequate marketing Charter Continued Project Manual 21
  25. 25. Summary Milestones Milestone Date Form LLC Obtain loans Select Location Concept Marketing Staffing Operations Estimated Budget & Variance Management $150,000: Give each activity a reserve once exceeded reevaluate situation and decide whether to end, or create a new budget. Decisions The decision process will begin with communication. The utilization of qualitative and qualities tools will also help guide the decision process. Further decisions will be divided up into two general role categories with Andy handle the operations aspects of the company. Tristan will handle the financial decisions. Conflict Resolution 51% ownership to Andy 49% ownership to Tristan The final decision will rest with Andy’s majority vote. Approvals Project Manager: ____________________________________ Date: _______________ Owner: ____________________________________________ Date: _______________ Owner: ____________________________________________ Date: _______________ 2 AON and AOA examples Project Manual 22
  26. 26. 3 Forward & Backwards Pass Early Start + Duration = Early Finish Late Finish – Duration = Later Start Late Start – Early Start = Max Float Project Manual 23
  27. 27. 4 Selection Criteria Criteria Name Description Weight Space 600 – 800 Square feet 3 Cost Between $125,000 and $75,000 5 Visibility Is the space noticeable 5 Parking Availability of parking 3 Cash flow Money coming in 5 Management Management issues 1 Décor How the place is furnished 1 Kitchen Good kitchen equipment 5 Seating Seating area and arrangement 3 Location The neighborhood 5 Foot Traffic Number of people going by the restaurant 3 Food Quality of food 5 Hours Potential Hours of operation 3 Storage Well situated storage space 5 Bathrooms Adequate restrooms 1 Accessibility Is the space easily accessible 3 T a b l e : 1 = N i c e t o h a v e 3 = F a v o r a b l e 5 = I m p o r t a n t Project Manual 24
  28. 28. Selection Criteria Continued S c o r e = W e i g h t * R a t i n g 1 t h r u 5 : 1 b e i n g l o w , 5 b e i n g h i g h Project Manual 25 Criteria Name & Weight Option A Option B Option C Rating Score Rating Score Rating Score Space - 3 3 9 Cost - 5 5 25 Visibility - 5 3 15 Parking - 3 1 3 Cash Flow - 5 4 20 Management - 1 4 4 Décor - 1 3 3 Kitchen – 5 4 20 Seating - 3 1 3 Location - 5 4 20 Foot Traffic - 3 4 12 Food - 5 4 20 Hours – 3 3 9 Storage - 5 1 5 Bathroom - 1 0 0 Accessibility - 3 3 9 Totals 46 177
  29. 29. Works Cited Cialdini, R. B. (2007). Influence The Psychology of Persuasion. New York , NY: Collins . David, M. G. (2005). Exploring Psychology Sixth Ed. New York: Worth. Davis, S. B., & Goetsch, D. L. (2001). Total Quality Handbook. Upper Saddle River, NJ: Prentice Hall. Project Management Institute . (2008). A Guide to the Project Management Body of Knowledge. Newtown Square, PA: PMI. Stackpole, C. S. (2009). A Project Manager's Book of Forms. Hoboken, NJ: Wiley . Whetten, D. A., & Cameron, K. S. Developing Management Skills. Upper Saddle River, NJ: Pearson . Project Manual 26