2-INTRODUCTION _ ENVIRONMENTS IN WHICH PROJECTS OPERATE_v4.pdf

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Introduction & The Environment in Which Projects Operate

Agenda
• Project
• Operational Work
• Project Management
• Program
• Portfolio
• Project Management Office (PMO)
• Objectives

Agenda
• Constraints
• Stakeholders
• Organizational Structure
• Life Cycle
• Project and Development Lifecycles
• Project Phases & Phase Gates
• Business Case
• Benefits Management Plan
• Lessons Learned

Definition of Project
Project
• Temporary endeavor with a beginning and an end
• Creates a unique product, service or result

Why are Projects Initiated?
• Market Demand
• Strategic Opportunity/Business Need
• Social Need
• Environmental Consideration
• Customer Request
• Technological Advance
• Legal Requirement

Example of a Project
• Construction of Golden Gate Bridge.
• Beginning: Jan 5, 1933
• End: April 19, 1937
• Temporary
• Unique

Definition of Operational Work
• Most of the work being done in organizations
• Ongoing
• Repetitive

Example of Operational Work
• Yearly maintenance of Golden Gate Bridge
• Repetitive (yearly)

Initiating Planning Executing
Monitoring
and
Controlling
Closing
What is Project Management?
• Project management is the application of knowledge, skills, tools
and techniques to project activities to meet the project
requirements.
• Profession growing rapidly
• Follows systematic process
• Process groups of project management:

Knowledge Areas:
• Integration Management
• Scope Management
• Schedule Management
• Cost Management
• Quality Management

Knowledge Areas:
• Resource Management
• Communications Management
• Risk Management
• Procurement Management
• Stakeholder Management

Definition of Program
• Group of projects
• Management is coordinated because they are related

Example of Program
• Manufacturing a new Airbus Airplane
Projects:
• Avionic Systems
• Communication Systems
• Entertainment System
• Security System
• ….

Definition of Portfolio
• Group of programs to achieve a business goal.
• Programs might not be related.
• It is important to serve for same business goal.

Example of Portfolio
• Airbus will develop 3 new airplane versions in 6 years.
• Strategic goal: to be the world’s most passenger carrying airplane
company.

Project, Program, Portfolio…
6 Year Airplane
Manufacturing
Portfolio
Airbus 921
Program
Avionic Systems
Project
…
Airbus 922
Program
Communication
Systems Project
…
Airbus 923
Program
Entertainment System
Project
…

Comparative Overview (Project, Program, Portfolio)

Project Management Office (PMO)
Department centralizes the management of projects
PMO Structures:
1. Supportive: Supplies templates, best practices, training, lessons
learned…etc. Acts as repository. (Low degree of control)
2. Controlling: Supports and requires compliance to tools,
methods. (Moderate degree of control)
3. Directive: Directly manages the projects. (High degree of
control)

PMO May:
• Manage interdependencies between projects
• Help providing resources
• Terminate projects
• Monitor compliance with organizational processes
• Gather lessons learned

PMO May:
• Provide templates
• Provide guidance
• Provide centralized communication about the projects
• Be part of change control board
• Be a stakeholder

Role of the Project Manager
• Person assigned by the organization to lead the team that is
responsible for achieving project objectives.
• Depending on the type of organization Project Manager can report to
Functional Manager
Program Manager
Portfolio Manager

Role of the Project Manager
• Link between strategy and team.
• Project Manager should have:
Knowledge (about project management)
Performance (how he applies knowledge)
Personal (behavior)

Interpersonal Skills of a Project Manager
• Leadership
• Team building
• Motivation
• Communication
• Influencing
• Decision Making
• Political & Cultural Awarenes
• Negotiation
• Trust building
• Conflict Management
• Coaching

Objectives
• What needs to be achieved as a result of project.
• For example: Golden Gate Bridge Construction:
• Objectives:
6 lanes in total (3+3)
Must carry at least 2,500,000 kgs
Must resist at least 8.5 Richter Earth-Quake

Important Points - Objectives
• Projects are considered complete when objectives are met
• A reason for terminating a project before completion is that the
project objectives cannot be met
• Meeting project objectives is under Project Manager’s
responsibility.

Important Points - Objectives
• Quality activities are for checking whether the project meets
its objectives.
• There is a trade-off between requirements & objectives.

Management by Objectives (MBO)
• A management philosophy
1. Establish clear & realistic objectives
2. Periodically evaluate if objectives are met
3. Implement corrective action

Constraints
Cost
Scope
Quality
Customer
Satisfaction
Risk
Resources
Time

Constraints
• If there is a change on one constraint, evaluate its effect on other
constraints
• For example, if your schedule is shortened, there might be
Additional resources (cost increase)
Faster completion (risk increase, quality decrease)

Organizational Process Assets
• Plans, processes, policies, procedures and knowledge bases
specific to and used by the performing organization.
• Includes lessons learned and historical info.
• Input to most planning processes.
• Corporate knowledge base is for storing and retrieving
information.

Enterprise Environmental Factors
• Conditions that are not under the control of the project team, that
influence, constrain or direct the project.
• Input to most planning processes.
• Examples:
Organizational culture, structure, and governance
Government or Industry Standards
Political Climate
Marketplace Conditions

Stakeholders
• People whose interests may be positively or negatively impacted
by the project.
• Includes all members of the project team.
• Identifying stakeholders, understanding their relative degree of
influence on a project, and balancing their demands, needs and
expectations are critical to success of the project.

Stakeholders

Stakeholders of Golden Gate Bridge
• Everybody who worked in the project
• Government
• Sea transporters
• People residing closer to the bridge
• ….

Project Governance
• Provides the project manager and team with structure, processes,
decision-making models and tools for managing the project.
• Involves stakeholders, documented procedures, standards,
responsibilities and authorities.

Project Team
• Project Manager and the group of individuals who perform the
project work.
• Project Manager is the leader of the team, and his authority is
over the project members.

Organizational Structure
• One of the main factors affecting projects in an organization.
Three types of organizations:
• Functional
• Projectized
• Matrix

Functional
• Most common form
• Grouped by areas of specialization
Marketing, Human Resources, IT, Sales… etc.
• Requests and information is transmitted through head of departments
• Team members do
(project work)+(departmental work)

Functional

Projectized
• Entire company is organized by projects.
• Project Managers have control of projects.
• No departments for resources.
• When project is over, personnel is either assigned to a new
project, or need to find a new job.

Projectized

Matrix (Projectized+Functional)
• Attempt to get strengths of projectized and functional
organization.
• Team members report to project manager and functional
manager.
Team Member
Project
Manager
Functional Manager
(Software
Development
Manager)

• Team members do
(project work)+(departmental work)
Strong Matrix Balanced
Matrix
Weak Matrix
Power of Project
Manager
Power of Functional
Manager
P
O
W
E
R

• In weak matrix organization, Project Managers are:
Project Expediter: acts as staff assistant and communications
coordinator.
Cannot take any decision.
Project Coordinator: acts like Project Expediter, but has some
power and can take some decisions.

Weak Matrix

Balanced Matrix

Strong Matrix

Advantages of Functional Organization
• Easier management of specialists
• Team members report to only one supervisor
• Similar resources are centralized
(e.g., software developers to IT department)
• Clearly defined career paths in areas of specialization
Developer Senior Developer Expert Developer Architect…
etc.

Disadvantages of Functional Organization
• People place more emphasis on their functional specialty to the
detriment of the project.
• No career path in project management
• The project manager has little or no authority.

Advantages of Projectized Organization
• Efficient project organization
• Loyalty to the project
• More effective communications than functional

Disadvantages of Projectized Organization
• No “home” when project is finished
• Lack of professionalism in disciplines
• Duplication of facilities and job functions
• Less efficient use of resources

Advantages of Matrix Organization
• Highly visible project objectives
• Improved project manager control over resources
• More support from functional areas
• Maximum utilization of scarce resources
• Better coordination
• Better horizontal and vertical dissemination of information
• Team members maintain a “home”

Disadvantages of Matrix Organization
• Extra administration is required
• More then one boss for project teams
• More complex to monitor and control
• Tougher problems with resource allocation
• Needs extensive policies and procedures
• Functional managers may have different priorities than project
managers
• Higher potential for conflict

Comparative Overview of Organizational Structures

Other Types of Organizational Structures

Life Cycle
• Progression through a series of differing stages of development
• Generic Life Cycle
for all projects

Life Cycle
• Impact of Variable Based on Project Time

Product Life Cycle
• Starts from conception of a new product to its withdrawal
• A Product can require many projects over its life
• Determine customer’s
need (conception)
• Analyze competition
(maturity)

Project Life Cycle
• Changes depending on the industry or organization’s preferences.
Construction:
Feasibility Planning Design Production Turnover Startup

Project Life Cycle
Information Technology (IT):
High Level
Design
Detailed
Design
Coding Testing Installation Conversion
Turnover
to
Operations

Project Management Process Groups
• Project Management Process includes:
Initiating
Planning
Execution
Monitoring & Controlling
Closing
• Life cycle can change from project to project, but project
management process groups are same.

Project Management Process Groups

Project Life Cycle in a Small Project

Project Life Cycle in a Large Project

Starting the
Project
Organizing
and Preparing
Carrying Out
the Work
Ending the
Project
Project & Development Life Cycles
• There might be different project lifecycles for each industry or
organization.
• E.g. For a software development Project, phases can be as below:
• Analysis Technical Design Software Development Testing User Acceptance Tests
Deployment
• Project lifecycles can be either predictive or adaptive.
• Development lifecycles can be predictive, iterative, incremental or
hybrid.

Project & Development Life Cycles
Development Lifecycle Types:
• Predictive (Waterfall): scope, time, and cost are determined in the early
phases of the lifecycle
• Iterative: scope is determined early in the lifecycle, time and cost
estimates are determined as the team knows more throughout the
project.
• Incremental: deliverable is produced through a series of iterations and
each iteration gives a new set of functionality to the user.
• Adaptive (change-driven): agile, iterative or incremental.
• Hybrid: Predictive+Adaptive

Project Phases & Phase Gates
Project Phases:
• Collection of related activities that will produce a meaningful
deliverable
• E.g. Phases of a Software Development Project
• Analysis
• Technical Design
• Software Development
• Testing
• Deployment
• After-live support

Project Phases & Phase Gates
Phase Gates:
• Held at the end of a phase.
• Review of
• Project Business Case
• Project Charter
• Project Management Plan
• Benefits Management Plan
• Corporate companies define different phases for different
type of projects

Business Case
• Business Case + Benefits Management Plan = Business Documents
• Sponsor is accountable for preparing and managingbusiness case document
• Covers «why the project is initiated» and «benefits that will come with
project»
• Business case document is used for go/no-go decision
• Business case covers:
• Business needs
• Analysis of the situation
• Recommendation
• Evaluation

Benefits Management Plan
• Defines the processes for creating, maximizing and sustaining the benefits
provided by a project.
• Benefits Management Plan covers:
• Target benefits
• Strategic alignment
• Timeframe for realizing benefits
• Benefits owner
• Metrics
• Assumptions
• Risks

Tailoring
• «Good Practice» does not mean it should be applied in all projects
• Tailoring: selecting appropriate tools, techniques, procedures etc. to manage
a project.
• Tailoring is necessary because each project is «unique»

Lessons Learned
• Includes
What was done right
What was done wrong
What would be done better if the project could be re-done
• Should cover:
Technical aspects of the project
Project Management (WBS, risk planning, etc.)
Management (communications, leadership)

Role of Lessons Learned

Question #1
A project manager is trying to complete a software development
project, but cannot get enough attention for the project. Resources
are focused on completing process-related work and the project
manager has little authority to properly assign resources. What form
of organization must the project manager be working in?
A-) Functional
B-) Matrix
C-) Expediter
D-) Coordinator

Question #2
The project life cycle differs from the product life cycle in that the
project life cycle:
A-) Does not incorporate a methodology
B-) Is different for each industry
C-) Can spawn many projects
D-) Describes project management activities

Question #3
Your management has decided that all orders will be treated as “projects” and
that project managers will be used to update orders daily, to resolve issues, and
to ensure that the customer formally accepts the product within 30 days of
completion. Revenue from the individual orders can vary from $100 to $150,000.
The project manager will not be required to perform planning or provide
documentation other than daily status. How would you define this situation?
A-) Because each individual order is a “temporary endeavor”, each order is a
project.
B-) This is program management since there are multiple projects involved.
C-) This is a recurring process.
D-) Orders incurring revenue over $100,000 would be considered projects and
would involve project management.

Question #4
The previous project manager for your project managed it without
much project organization. There is a lack of management control
and no clearly defined project deliverables. Which of the following
would be the BEST choice for getting your project better organized?
A-) Adopt a life cycle approach to the project
B-) Develop lessons learned for each phase
C-) Develop specific work plans for each work package
D-) Develop a description of the product of the project.

Question #5
A company is making an effort to improve its project performance
and create historical records of past projects. What is the BEST way
to accomplish this?
A-) Create project management plans
B-) Create lessons learned
C-) Create network diagrams
D-) Create status reports

Question #6
One of your team members informs you that he does not know
which of the many projects he is working on is the most important.
Who should determine the priorities among projects in a company?
A-) The project manager
B-) The project management team
C-) The project management office (PMO)
D-) The team

Question #7
A market demand, a business need, and/or legal requirement are
examples of:
A-) Reasons to hire a project manager
B-) Reasons projects are initiated
C-) Reasons people or businesses become stakeholders.
D-) Reasons to sponsor a project.

Question #8
Consideration of ongoing operations and maintenance is crucially
important to products of projects. Ongoing operations and
maintenance should:
A-) Be included as activities to be performed during project closure
B-) Have a separate phase in the project life cycle, because a large
portion of life cycle costs is devoted to maintenance and operations
C-) Not be viewed as part of a project. A project is temporary with a
definite beginning and end.
D-) Be viewed as a separate project.

Question #8
Consideration of ongoing operations and maintenance is crucially
important to products of projects. Ongoing operations and
maintenance should:
A-) Be included as activities to be performed during project closure
B-) Have a separate phase in the project life cycle, because a large
portion of life cycle costs is devoted to maintenance and operations
C-) Not be viewed as part of a project. A project is temporary with
a definite beginning and end.
D-) Be viewed as a separate project.

Question #9
Lessons learned are BEST completed by:
A-) The project manager
B-) The team
C-) The sponsor
D-) The stakeholders

Question #10
A manager and the head of engineering discuss a change to a major
work package. After the meeting, the manager contacts you and tells
you to complete the paperwork to make the change. This is an
example of:
A-) Management attention to scope management.
B-) Management planning.
C-) A project expediter position.
D-) A change control system.

2-INTRODUCTION _ ENVIRONMENTS IN WHICH PROJECTS OPERATE_v4.pdf

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