PROJECT MANAGEMENT

(MAPM 531)
Ermias T. (Asst. Prof. in MGMT)
Lecturer, School of Graduate Studies, Department of Management,
Assosa University, Ethiopia

Email: ermitaw22@[Link]
 CONTENTS

CHAPTER 1: Understanding the Essence of Project and Project MGMT

CHAPTER 2: Project Life Cycle

CHAPTER 3: Project Identification

CHAPTER4: Project Preparation and Feasibility Analysis

CHAPTER 5: Project Planning

CHAPTER 6: Project Implementation

CHAPTER 7: Project Monitoring, Controlling and Evaluation

CHAPTER 8: Project Termination and Reporting

09/30/23 ASU/PM/ 2
 ASSESSMENT

To evaluate the performance of students, the following

assessment elements will be used:
Test - 20%
Assignment - 20%
Presentation- 10%
Final exam – 50%

09/30/23 ASU/PM/ 3
 CHAPTER ONE

Understanding the Essence of

Project and Project Management
 1.1 Introduction
Learning project management can help you complete projects on
time, on budget, and on target.
Project is a great opportunity for organizations and individuals to
achieve their business and non-business objectives more
efficiently. Projects help us make desired changes in an
organized manner.
Organizations are increasingly using projects to meet their goals.
Projects are usually a means to achieve the organisation’s
strategic plan.
Projects are undertaken as a means of organising activities that
are impossible to address within the normal operational
limits of the organisation.
 Why a Project?
A project is generally called upon to provide a solution to a
problem or to take advantage of an opportunity.
These needs might have to do with:
 Reducing costs
 Increasing revenues
 Eliminating waste
 Increasing productivity and efficiency
 Solving a business or functional problem
 Taking advantage of market opportunities
 Filling social needs
 Improving service to customers
 What Is a Project?
A project is an investment activity in which financial
resources are expected to create capital assets that
produce benefits over an extended period of time.

A project is a temporary endeavor undertaken to create a

unique
 product,
 service or result.
A project can create:
 A product that can be either a component of another
item, an enhancement of an item, or an end item in
itself;
 A service or a capability to perform a service (e.g., a
business function that supports production or
distribution);
 A result, such as an outcome or document (e.g., a
research project that develops knowledge that can be
used to determine whether a trend exists or a new
process will benefit society).
 Project Vs Operations
Projects are unique and temporary (definitive beginning
and ending), while operations are ongoing and
permanent with repetitive output.

Operations are the ongoing execution of activities that

produce the same output or provide a repetitive service.

Projects are executed to start a new business objective and

terminated when it is achieved, Operations do not
produce new things, but they are necessary to maintain and
sustain the system.

Projects have a fixed budget, while operations have to

earn a profit to run the business.
 Project Vs Operations
Projects/ Operations/
Basis of Comparison
Project Work Functional work
Repeated, on-going/the
Type of work/product Unique
same
No definitive beginning and
Time Definite beginning and end
end.
Occurrence Temporary in nature Ongoing
On-going operational
Budgets For specific projects
budgets
Accomplishing effective
Focus Completing the project
work
Mgt responsibility Managing work Managing people.
• Production processes
• Managing specific
The construction of a
activities associated with
Example headquarters building for
functions such as
ABC Industries
accounting, manufacturing,
or marketing)
 Cont…

Which ones are projects and which ones are operations?

A. Building an extension on a house.

B. Shelving books at the library.

C. Baking a wedding cake.

D. Watering your plants twice a week.

E. Designing a new car model.

F. Organizing a large conference

G. Going to the gym three times a week.

 1.2 Features of Project
 Temporary.
A project has a definite beginning and definite end. Projects always
have a start and a finish.

Each activity, and the entire project, has a start and stop date.
The duration of a project is finite.
Unique- New undertaking.
A project has never happened exactly in the same way
before, and it will never happen again under the same conditions.

Projects involve doing something that has not been done

before in the same environment.
No two projects are the same. Projects differ from each other with regard to
time and space, deliverables or outputs as well as other characteristics of the
projects.
 Cont…
Difference between projects

One project could be different from another in the following respects:

1. Number of various skills, departments and people involved

2. Amount of time involved

3. Number of different activities involved

4. Amount of money involved

5. Impact on the organisation and customers

6. Location/site

7. Control procedures

8. Communication procedures
 Cont…

 Progressively Elaborated

Projects are developed in steps. A project occurs step by

step to define the product or service

We learn more and more about the project as it goes on.

When we start, we’ve goals and a plan, but there’s always

new information to deal with as our project goes on and
we will always have to make decisions to keep it on track.
 Cont…

 Connected Activities/Interdependencies

A project consists of a number of interrelated activities that

are performed sequentially or in parallel.

Connectedness implies that there is a logical or technical

relationship between pairs of activities.

They are considered connected because the output from one

activity could be an input.

 Within Budget

Projects also have resource limits, such as a limited amount

of people, money, or machines that are dedicated to the
project.
 Cont…
 Involves uncertainty

Detail requirements may not be known in advance.

As a result of its uniqueness, dependency on other agencies and its

relatively long-term nature; a project is faced with a lot of uncertainty.

 Teamwork
Projects require a team of people with different skills to get the job done.

Integration

Projects Require resources to be brought together in a process.

 Examples of Project
 Developing a new product or service

 Constructing a road, bridge, building or facilities

 Renovating an old house

 Effecting change in a structure of an organisation

 Designing a new vehicle

 Developing or acquiring a new or modified information system.

 Building a water system for a community

 Working on solving organisational problems like inefficiency

 Conducting research

 Organizing a meeting (Hosing conference)

 Organising an event, like a wedding or a party.

 1.3 Types of Project
Project can be classified based on;
1. Project class 3. The sources of finance

2. Ownership 4. The forces Behind

1. Project class:

CLASS DURATION RISK COMPLEXITY

Type A > 18 months High High

Type B 9–18 months Medium Medium

Type C 3–9 months Low Low

Type D < 3 months Very low Very low
 Cont…

2. Based on ownership:
Private sector- projects undertaken by business
enterprises.

Public sector- projects undertaken by national and local

government bodies.

NGOs- projects undertaken by non-government and non-for

profit organizations.
 Cont…

3. Based on the Sources of Finance:

Government treasury- projects entirely financed by
government budget as per its priority.

Government treasury and external sources- Projects

financed by the joint partnership of the government and
donor groups.

External sources of Finance- Projects financed totally by

parties other than the government but the ownership may be
for the government or the public.
 Cont…
4. Based on the forces Behind:
Demand driven/need driven. Based on identified unsatisfied
demand project can be created or on unsatisfied basic needs like food,
water and shelter.

Donor driven. The force behind the financing organization. Donors

will have their own say and influence the types of projects to be
established.

Political Driven. Projects may be established in response to some

political situation such as for example because of national elections.

Crisis-driven. A fast solution to a specific problem. In response to

complaints.

Change-driven. the need to change operations to match the current

environment or to be more effective.
 Roles of project manager
A Project Manager is a professional in the field of project management.

The project manager is a person who is responsible to perform a

management function in a given project.

i.e. a function of Planning, Organizing, Staffing, Controlling and

Directing to attain project goals.

While performing those functions, project managers will play the

following major roles as Integrator, communicator, decision maker,
motivator, evangelist, entrepreneur, and change agent.
 Skills for Project Managers
Leadership skills: Sets examples, provides vision, delegates, energetic.

Communication skills: Listens, persuades.

Problem solving skills: Identify problems early and solve them.

Coping skills: Flexible, creative, patient, persistent.

Integration Skills: to ensure that the various elements of the project are
properly coordinated.

Technical Skills: to monitor and evaluate the work of the project team.

Ability to develop people: Commitment to the training and development of

people working on the project.

Interpersonal skills, Time management skills, Technology skills

 Project Organization Structure
Organizational structure: is an arrangement of business
resource and responsibilities
The purpose of an organization structure is to coordinate
the efforts of many to accomplish goals.

There are three different types of organization structures

for projects, namely;
 functional,
 project, and
 matrix organization
 A. Functional Organization
In a functional structure, the orgn. is broken into
different sections based upon specialty.
Under this structure, different segments of the project
are delegated to the respective functional units
(departments).

The project coordinator's role is to ensure smooth

execution of activities of the project; however, the
functional manager has the most power and
makes decisions.
Con…
Advantages of FO Disadvantages of FO

No individual/dept. is directly given full

There is only one boss
responsibility/accountability for the total
Easy post-project transition-Short & well- project.

established comm. channels Work delays and hence slow completion

of projects
Career development
Low coordination across functions
Comfortable and easy Motivation and innovation are decreased

In-depth technical expertise Lack of a big picture view

Doesn’t facilitate a holistic approach to
Flexible resource assignment (human,
the project.
material, etc)
B. Projectized Organization
It is a project focused organizational structure where project
manager has the final authority over the project .

In this arrangement, the project is separated from the rest of the

parent organization. Project teams operate as a separate units.

The project becomes a self-contained unit with its own technical

staff, its own administration, tied to the parent firm by periodic
progress reports and oversight.

In this structure, all the work is looked at as a project.

All team members report directly to the project manager.

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 Advantages:-
Good communication exists within the project work.
The project manager has full line authority over the project.
As a result, decisions are made quickly.
Motivation and commitment are high.
Fast completion of projects
Unity of command exists. That is subordinate has one, and
only one boss.
structurally simple, which makes it relatively easy to
understand and to implement.
The organizational structure tends to support a holistic
approach to the project.
Disadvantages:-

The team breaks up and disperses after the completion

of the project. Hence there is no sense of job security
for workers.
Duplication of same resources for each project
(people, material, etc).
High cost of project
Organizational policies and goals will be ignored
because team members are often both physically
and psychologically removed from headquarters.
 C. Matrix Organization

 The matrix project attempts to blend/mixed properties of functional

and pure project structures. Each project utilizes people from
different functional areas.
- It is applied by drawing employees from different functional
disciplines for assignment to a team without removing them from their
respective positions.
- Each project personnel has dual responsibility and two
bosses; they report both to the functional manager and the
project manager.
- Because of its complexity, this type of structure can lead to
problems if it is not used carefully and properly.
- Good communication is essential for success.
Matrix organization Structure
The matrix structure has three forms;

1. strong matrix, the power resides more with the

project manager.

2. weak matrix, the power resides more with the

functional manager.

3. balanced matrix, in which the power is shared

equally.
Advantages of Matrix Structure
Enables for efficient use of resources

Communications between functional divisions is enhanced

Team members have a functional “home” after project
completion, so they are less worried about “life after the
project ends”
There is a project team which is dynamic and able to view
problems in different way.

Project cost is minimized because resources are shared and

used as needed

The project is the point of emphasis

Disadvantages of Matrix
Division of authority and responsibility in a matrix
organization is complex, and uncomfortable for the PM.
A conflict of interest
Multi dimensional workflow
Staff attention fractured
Projects can be difficult to monitor if there is no proper
communication and if teams have a lot of independence
There are two bosses. As a result, the principle of unity of
command is violated. The functional manger will be listened to
before the project manager.
 Choosing Appropriate Organizational Structure
 While choosing organizational forms we shall consider such factors

as
 Nature of the project
 The characteristics of the various organizational options,
 The advantages and disadvantages of each,
 The objective of the organization, and then make the best
compromise that can be made.

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 For example, the functional form is preferred for projects that will require
large capital investments in equipment or buildings of a type normally
used by the function.

 If the firm engages in a large number of similar projects (for example,

construction project) the pure project form of organization is preferred.

 The pure organizational form also be preferred for one-time, highly

specific, unique tasks that require careful control and are not appropriate
for a single functional area.

 When the project requires the integration of inputs from several

functional areas and involve reasonably sophisticated technology but does
not require all the technical specialists to work for a project on a full-time
basis, the matrix organization is the only satisfactory solution.

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1.10. Project management group processes
 Cont…
1. Initiating
Determines the nature and scope of the project.

Understanding of the business environment & incorporating all

necessary checks into the project

The first project document ( project charter) developed . With key

components:-
Business case
Scope and deliverables
Objectives
Resources needed
Milestone plan and timeline
Cost estimate
Risks and issues
Dependencies
charter answers the fundamental question, "What are we trying to do?"
 Cont…
2. Planning
project is planned to an appropriate level of detail.
planning includes :
Developing the scope statement
Developing the schedule (often a Gantt chart)
Developing the budget
Selecting the team
Creating a work breakdown structure
Identifying deliverables
Planning for risk
Establishing a communication plan
 Cont...
3. Executing(Implementing )
used to complete the work defined in the project
management plan.

It's about accomplishing the project's objectives.

involves coordinating people and resources.

integrating and performing the project activities.

The deliverables are produced as outputs from the

processes performed
 Cont…
4. Monitoring
Potential problems can be identified. Monitoring
includes :-
Measuring ongoing project activities
Monitoring the project variables (cost, effort, scope)
Identifying corrective actions to address risks issues
Managing changes using the change control process
monitoring process ends once the project has
achieved its goals and objectives
Monitoring also means that sometimes a project is
stopped before completion.

B/s for many reasons, including changes in the

business, lack of resources or higher priorities.
 Con…
5. Closing
finishing all activities across all process groups, disbanding the
project team and signing off the project with the customer.

This task is done using the project closure report.

report communicates how well the project has performed
against its original business case, quality measures, cost,
duration and tolerances.

report passes on valuable lessons that future projects can

apply.
 Project Management Knowledge Areas
1. Project Scope Management: includes all the work required, and
only the work required, to complete the project successfully.
2. Project Time Management: includes the processes required to
manage the timely completion of the project. It is about tracking our
schedule.
3. Project Cost Management: includes planning, estimating, budgeting,
financing, managing, and controlling costs so that the project can be
completed within the approved budget.
4. Project Quality Management: includes the processes and activities
of the performing organization that determine quality policies,
objectives, and responsibilities

5. Project Human Resource Management: includes the processes

that organize, manage, and lead the project team.
6. Project Communications Management:

7. Project Risk Management: includes the processes of conducting risk

management planning, identification, analysis, response planning, and
controlling risk on a project.

8. Project Procurement Management: includes the processes necessary to

purchase or acquire products, services, or results needed from outside the
project team.

9. Project Stakeholder Management: includes the processes required to

identify all people or organizations impacted by the project, analyzing
stakeholder expectations and impact on the project.

10. Project Integration Management: includes the processes and activities

needed to identify, define, combine, unify, and coordinate the various
processes .
 Critical Success Factors of a project
Factors that are critical to project success:
1. Clearly defined goals and project mission
2. Top management support
3. A competent project manager
4. A competent project team
5. Sufficient resources
6. Customer involvements
7. Good communication
8. Responsiveness to customers
9. Proper monitoring and feedback
10. Appropriate technology