This chapter introduces key concepts of project management including defining projects and differentiating them from operations. It describes the project life cycle and project management life cycle. It identifies important stakeholders and discusses how organizational structure, such as functional, matrix, and projectized, can influence a project. The chapter aims to explain these fundamental concepts and how they relate to effective project management.

1. Chapter 1: Project Management
Concepts
 What Is a Project?
 What Is Project Management?
 Life Cycles of Projects and Project
Management
 Project Stakeholders
 Organizational Structure and Its Influence

2. Learning Objectives:
After completing this chapter, you will be able to:
 Differentiate between projects and operational work
 Describe the main concepts of project management
 Explain the differences between the project life cycle and
the project management life cycle
 Identify project stakeholders and their influence
 Compare the different types of organizational structures

4. What Is a Project?
A project is:
Temporary
It has a definite
beginning and a
definite, measurable
end.
Unique
The project is
undertaking something
that has not been
undertaken previously.
At least some aspect is
unique.
Projects embrace the concept of progressive elaboration;
that is, as time goes by, you learn more about the project
as you do the work of the project.

5. What Is a Project?
Projects vs. Ongoing Operations
According to the PMBOK Guide:
Projects : Temporary, unique; embrace
progressive elaboration
Operations : Ongoing, repetitive; do not fit
all the criteria of a project

7. What Is Project Management?
Overlapping Disciplines
Project Management
environment skills
Application
knowledge
Body of knowledge Interpersonal skills

8. Project Management Components
Portfolios, Programs, and Subprojects
Program
Project A Project B
Subproject Subproject Subproject Subproject
Portfolio
Program
Project A Project B
Subproject Subproject Subproject Subproject

9. Project Management Components
Project Management Office

10. What Is Project Management?
Project Management System

12. Life Cycles of Projects and Project Management
Project Life Cycle vs. Project Management Life Cycle
Software development project
Design Code Test Train Implement
Project management life cycle Project life cycle
Initiating Initiating Initiating Initiating Initiating
Planning Planning Planning Planning Planning
Executing Executing Executing Executing Executing
Monitoring & Monitoring & Monitoring & Monitoring & Monitoring &
Controlling Controlling Controlling Controlling Controlling
Closing Closing Closing Closing Closing

13. Life Cycles of Projects and Project Management
Project Life Cycle vs. Product Life Cycle
Product life cycle stages:
Introduction and creation
Growth
Maturity
Decline
Projects run in the context of the product life cycle.
Many projects can be undertaken throughout
the product life cycle.

14. Project Stakeholders
It is important to identify stakeholders.
Who is or should be involved?
Who is external to the
organization?
Who has “bought in” and who
hasn’t?
Who can influence the
project’s performance or
outcome?

15. Organizational Structure and Its Influence
Functional Weak Matrix Strong Projectized
Functional Weak Matrix Strong Projectized

16. Organizational Structure and Its Influence
Functional Organization
Power resides with the
functional manager. CEO
Functional Functional Functional Functional Functional
manager manager manager manager manager
Staff Staff Staff Staff Staff
Staff Staff Staff Staff Staff
Staff Staff Staff Staff Staff
*Darkened boxes represent staff working on project activities.

17. Functional Organizations
Advantages and Disadvantages of
Functional Structures
Advantages
Familiar structure
One-supervisor reporting
structure
Clearly defined career paths
Employees as experts
Disadvantages
Employee’s job difficult to change
Need to fight for resources
and project priority
Functional manager responsible
for performance reviews and
promotions
Competition for resources
Little or no project manager
authority
No clearly defined project
management career path

18. Organizational Structure and Its Influence
Matrix Organization
Two bosses:
Power resides with both
functional manager and the CEO
project manager.
Functional
manager
Staff
Staff
Project
manager
Functional
manager
Staff
Staff
Staff
Functional
manager
Staff
Staff
Staff
Functional
manager
Staff
Staff
Staff
Functional
manager
Staff
Staff
Staff
*Darkened boxes represent staff working on project activities.

19. Matrix Organization
Advantages and Disadvantages of Matrix
Structures
Advantages
Continued visibility of
objectives
Increased support from
functional managers
Increased control by project
manager
Improved flexibility
Continued job after project
completion
Multiple input on performance of
team members
Disadvantages
Multiple bosses
Added complexity
Need for additional policies and
procedures
Differing priorities or objectives

20. Organizational Structure and Its Influence
Projectized Organization
Power resides with
project manager. CEO
Project Project Project Project Project
manager manager manager manager manager
Staff Staff Staff Staff Staff
Staff Staff Staff Staff Staff
Staff Staff Staff Staff Staff
*Darkened boxes represent staff working on project activities.

21. Projectized Organization
Advantages and Disadvantages of Projectized
Structures
Advantages
Clear focus on project
Project loyalty
Efficient project
organization
Efficient project
communication
Disadvantages
Job over at project
completion
Less efficient use of
resources
Duplicated job functions
and facilities

22. The Structure of Organizations and Its Influence
Summary
Project
Aspect
Organization
Structure Functional
Weak Matrix
Matrix
Balanced
Matrix
Strong Projectized
Matrix
Project Manager Little or
Authority none
Resource Little or
Availability none
Project Budget Functional
Controlled By manager
Limited
Limited
Functional
manager
Low to
moderate
Low to
moderate
Mixed
Moderate to High to
high almost total
Moderate to High to
high almost total
Project Project
manager manager
Role of the Project
Manager Part-time Part-time Full-time Full-time Full-time
Project
Management Part-time Part-time Part-time Full-time Full-time
Administrative Staff
*Based on the PMBOK Guide, Fourth Edition.

23. Knowledge Check
Concepts You Should Know
 Important terms:
 Project: Temporary endeavor undertaken to produce a unique
product, service, or result
 Subproject: Component of project identified by subdividing the
project into smaller, more manageable pieces
 Operations: Ongoing, repetitive work of the organization
 Project management: Application of knowledge, skills, tools
and techniques to project work to fulfill project requirements
 Program: Interrelated group of projects and other work that are
managed together to achieve efficiencies not available by
managing them separately
 Portfolio: Group of programs, projects, and other work
managed together to meet strategic business objectives

24. Knowledge Check
Concepts You Should Know (cont.)
 Important terms (cont.):
 Project management system: Aggregated collection of
processes, tools, techniques, methods, procedures, and
resources assembled to manage projects
 Project stakeholder: Any individual or group that meets one or
more of the following requirements:
 Is involved in the project
 Has a positive or negative interest in the project
 Can exert influence over project performance or results

25. Knowledge Check
Concepts You Should Know (cont.)
 Triple constraint model:
 All projects are constrained by time, cost (or resources), and
scope.
 Changes to one set of constraints affect remaining areas of
constraint.
 Project management should be focused on identifying and
managing the balance among the areas of constraint.
 Three life cycles:
 Product life cycle: Sequence of phases that a product goes
through between conception and retirement
 Project life cycle: Sequence of phases of project work required
to meet project requirements
 Project management life cycle: Sequence of phases in the
management of the work of the project (remember IPECaC)

26. Knowledge Check
Concepts You Should Know (cont.)
 Projects generally occur within the larger product or service
life cycle and often occur as the means of transitioning a
product from one life cycle phase to another.
 Successful project managers make connections between the
following areas:
 Project Management Body of Knowledge
 Application area standards and regulations
 Organizational environment in which the project takes place
 General management skills
 Interpersonal skills

27. Knowledge Check
Concepts You Should Know (cont.)
 The PMBOK Guide identifies four general organizational
types:
 Functional organization: Hierarchical organization in which
employees are grouped based on their specialized skill set and
have a single, clear boss.
 Matrix organization: Structure in which the functional manager
and the project manager share responsibility for determining
priorities and directing the work of staff. The PMBOK Guide
classifies matrix organizations as weak, balanced, or strong.
 Projectized organization: Organization in which the project
manager has total authority to assign priorities, apply
resources, and direct the work of project staff.
 Composite organization: Organization in which projects can be
organized and managed in functional, matrix, or projectized
ways depending on the needs of the project.