The world of large complex projects is challenging to say the least with a majority of these projects significantly under performing. It is this weak performance regime that underpins the key premise of "Theory of Management of Large Complex Projects" – project management theory as it currently exists and is applied to large complex projects falls short, significantly short, of what these projects require. I have decided to serialize this book for the benefit of those interested in better understanding and improving project performance. If you are interested in purchasing a copy of the 400 page paperback you may click on http://www.lulu.com/us/en/shop/bob-prieto/theory-of-management-of-large-complex-projects/paperback/product-22342232.html

1. Theory of Management
of
Large Complex Projects
Bob Prieto

2. © 2015 by Bob Prieto
All rights reserved. No part of this publication may be reproduced or
distributed in any form or by any means, or stored in a data base or
retrieval system, except as permitted by Sections 107 or 108 of the
1976 United States Copyright Act, without the prior written
permission of the copyright holder.
Printed in the United States of America
ISBN 580-0-111776-07-9

3. 105
Chapter 6
A (Very) Short History of
Project Management Theory
The roots of project management theory go very much
back to the work of Taylor on scientific method and explicitly to
two of his “students”, Henry Gantt80
(who worked with Taylor)
and Henry Fayol. Gantt is readily recognized for his so-called
Gantt charts, a modernized version of which we find in the
1950’s conceived PERT81
with its stochastic (uncertain) activity
80
Henry Laurence Gantt was an American mechanical engineer and management consultant
who is best known for developing the Gantt chart in the 1910s. Gantt charts were employed
on major infrastructure projects including the Hoover Dam and Interstate highway system
and continue to be an important tool in project management and program management. In
1887 he joined Frederick W. Taylor in applying scientific management principles to the work
at Midvale Steel and Bethlehem Steel, working there with Taylor until 1893.
81
The program (or project) evaluation and review technique, commonly abbreviated PERT,
is a statistical tool, used in project management. Commonly used in conjunction with the
critical path method (CPM). It was able to incorporate uncertainty by making it possible to
schedule a project while not knowing precisely the details and durations of all the activities.
It is more of an event-oriented technique rather than start- and completion-oriented. This

4. 106
times. Fayol’s administrative theories with his defined five
management functions represent the core of the project
management body of knowledge.
So at its roots, project
management has an industrial
focus similar to the beginnings of
modern management theory. Work
breakdown structures (divisions of
work) and resource allocation
approaches flow directly from the
work of Taylor, Gantt and Fayol.
In the post war period we see
project management make further
advances through the introduction
of CPM82
, with its deterministic
activity periods and PERT, a modernization of Gantt’s work,
with the previously mentioned stochastic activity times.
This traditional project management approach is codified
with the 1969 issuance of PMBOK, the Project Management
Body of Knowledge, which was intended to provide a
management framework for most projects, most of the
time83
. We may have lost some visibility of this important
qualification, especially as projects have grown in scale,
duration and complexity.
project model was the first of its kind, a revival for scientific management, founded by
Frederick Taylor.
82
The critical path method (CPM) is a project modeling technique developed by Morgan R.
Walker of DuPont and James E. Kelley, Jr. of Remington Rand. Kelley attributed the term
"critical path" to the developers of the Program Evaluation and Review Technique (PERT)
which was developed at about the same time by Booz Allen Hamilton and the U.S. Navy.
The precursors of CPM contributed to the success of the Manhattan Project
83
Hatfield in The Coming Sea-Change in Project Management Science: Advances in Project
Management; PM World Journal; 2013 notes that “Organizations embracing the whole of the
project management body of knowledge, as documented by the Project Management
Institute, could not demonstrate a consistent competitive advantage over those organizations
that choose to only implement certain aspects of PM, or even none at all.”
Fayol’s Functions of
Management
To forecast
and plan
To organize
To command
or direct
To coordinate

5. 107
Further refinement of traditional PM theory comes with the
introduction of Prince2 and CCPM. Prince284
is a generic
process driven PM methodology with an output orientation and
a strong quality focus. PRINCE2 is based on seven principles
(continued business justification, learn from experience, defined
roles and responsibilities, manage by stages, manage by
exception, focus on products and tailored to suit the project
environment), seven themes (business case, organization,
quality, plans, risk, change and progress) and seven processes
(starting up a project, initiating a project, directing a project,
controlling a stage, managing stage boundaries, managing
product delivery, and closing a project) .
84
PRojects IN Controlled Environments, version 2.
We need to measure
complexity, as a system level
property

6. 108
Process Based Management85
, another amplification of the
traditional model, is driven by the use of maturity models such
as CCMI86
(Capability Maturity Model Integration) and its
sixteen core process.
Agile87
moves us beyond traditional PM theory with
considerations of iterative human interactions. Agile relies on a
series of small, discrete tasks conceived and executed to
conclusion as required. Task execution is contingent, executed
as required and in an adaptive manner rather than executing a
pre-planned process. Key to successful use is active client
involvement and real-time decision making.
Lean88
begins the integration of traditional methods and
human characteristics, focusing on individual and team
performance in addition to the more traditional task elements
and processes. The human dimension and commitment to
mission, vision and objectives is now a core management
feature and a key system’s element. System “flows” replace
pure input/output measures in more traditional project
management. Lean project management provides flexibility in
responding to dynamic systems, moving beyond the more static
constructs of traditional PM theory but potentially introducing
risks as capabilities and capacities are narrowed to reduce
waste and internal variability.
85
Process-based management is a management approach that views a business as a collection
of processes. Vision, mission and core value are three crucial factors to manage an
organization from a process perspective.
86
Capability Maturity Model Integration (CMMI) is a process improvement training and
appraisal program. CMMI models provide guidance for developing or improving processes
that meet the business goals of an organization.
87
Agile project management is an iterative and incremental method of managing the design
and build activities projects in a highly flexible and interactive manner. It relies on capable
individuals from the relevant business, with supplier and customer input.
88
The main principle of lean project management is delivering more value with less waste.
Lean project management has many techniques including standardization, blame-free
employee involvement and the need for a strong facilitator.

7. 109
Critical Chain Project Management 89
(CCPM) addresses
uncertainty and resource constraints. Critical chain project
management is based on methods and algorithms derived from
Theory of Constraints and include resource leveling and use of
buffers. All activities converge to a final deliverable. As such, to
protect the project, there must be internal buffers to protect
synchronization points and a final project buffer to protect the
overall project. CCPM builds on PERT and CPM as well as
system dynamics thinking. CCPM moves into the world of
dynamic systems.
The emergence of extreme project management90
moves
project management theory into the world of dynamic, non-
deterministic systems. The control point is focused on how you
respond to the reality that you have no (or at least limited)
control. The theoretical constructs of extreme project
management are as different from traditional PM theories as
Newtonian physics is from Einstein’s theory of relativity. Each is
reasonable within their respective scales. This is a key point;
extreme project management has applicability only in the world
of dynamic, non-deterministic projects with the properties of
scale, uncertainty and emergence91
.
89
Critical chain project management (CCPM) is a method of planning and managing projects
that emphasizes the resources required; strives to keep resources levelly loaded, but requires
that start times be flexible; and quickly switches between tasks.
90
Extreme project management (XPM) refers to a method of managing very complex and
very uncertain projects.
It utilizes an open, elastic and non-deterministic approach. The focus is on the human side of
project management (managing stakeholders), rather than on intricate scheduling and formal
processes and methods.
91
Emergence is a process whereby larger entities, patterns, and regularities arise through
interactions among smaller or simpler entities that themselves do not exhibit such properties.
Emergence is a central element in complexity theories. Emergence is described by economist
Jeffrey Goldstein as “the arising of novel and coherent structures, patterns and properties
during the process of self-organization in complex systems".

8. 110
Table 6-1 provides a brief comparison of the major classes
of PM theory92
.
Table 6-1
Comparison of Classes of PM Theories
Class Industrial Human Biological Evolutionary
Theories Traditional
Approach
Prince2
Process
Based
Manage-
ment
Agile Lean
CCPM
Extreme
Project
Management
92
In general, the various project management theories are not seen as management of
projects, including all the strategic contextual factors that this would entail, but rather as the
delivery of a project on time, in budget and to scope.

9. 111
Thought
Leaders
Taylor;
Gantt; Fayol
Goldratt93
Focus Input/Process Process/
Adaptive
Human
Inputs
(waste)
Stakeholders
Control
Point
Output Output Determinist-
ic output/
outcome
Emergent
outcomes
Key
Prin-
ciples
Work
Breakdown
Structure
Interactive
human
interaction
Traditional
methods
Open
approach
Resource
allocation
Contingent
task
execution
Individual
performance
Focus on
response
not control
Quality focus Adaptive
execution
Team
perform-
ance
Stakeholder
manage-
ment
Output
orientation
Active
client
involve-
ment
Dynamic
system
Dynamic
non-
determinist-
ic systems
Maturity
models
Real time
decision
making
System
flows
Large scale
93
Eliyahu Moshe Goldratt was an Israeli physicist who became a business management guru.
He was the originator of the Optimized Production Technique, the Theory of Constraints
(TOC), the Thinking Processes, Drum-Buffer-Rope, Critical Chain Project Management
(CCPM) and other TOC derived tools. Processes are typically modeled as resource flows.
The constraints typically represent limits on flows.

10. 112
Flexibility
in
response
High
uncertainty
Uncertainty Emergence
Resource
constraints
Waste
minimization