Project Management

Introduction
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What is a project?
• Projects are complex, one-time processes.
• Projects are limited by budget, schedule, and
resources.
• Projects are developed to resolve a clear goal
or set of goals.
• Projects are customer-focused.

A project is a temporary endeavor undertaken to

create a unique product, service, or result.
PMBoK 5th edition

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General project characteristics

• Projects are ad hoc endeavors with a clear life
cycle.
• Projects are building blocks in the design and
execution of organizational strategies.
• Projects are responsible for the newest and most
improved products, services, and organizational
processes.
• Projects provide a philosophy and strategy for the
management of change.
• Project management entails crossing functional
and organizational boundaries.

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General project characteristics

• Traditional management functions of planning,
organizing, motivation, directing, and control apply
to project management.
• Principal outcomes of a project are the satisfaction
of customer requirements within the constraints of
technical, cost, and schedule objectives.
• Projects are terminated upon successful completion
of performance objectives.

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Is this a project?
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Process & Project management (Table 1.1)

PROCESS PROJECT

 Repeat process or product  New process or product

 Several objectives  One objective
 Ongoing  One-shot limited life
 People are homogenous  More heterogeneous
 Well-established systems  Integrated system efforts
 Greater certainty  Greater uncertainty
 Part of line organization  Outside of line organization
 Established practices  Violates established practice
 Supports status quo  Upsets status quo

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Why are projects important?

1. Shortened product life cycles

2. Narrow product launch windows

3. Increasingly complex and technical products

4. Emergence of global markets

5. Increased competition

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Project life cycle

A project life cycle refers to the stages in a project’s
development and are divided into four distinct phases:
•Conceptualization – development of the initial goal and
technical specifications of the project. Key stakeholders
are identified and signed on at this phase.
•Planning – all detailed specifications, schedules,
schematics, and plans are developed.
•Execution – the actual “work” of the project is
performed.
•Termination – project is transferred to the customer,
resources reassigned, project is closed out.

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PROJECT LIFE CYCLE

(FIGURE 1.3)

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Change during project life cycle

Client
Interest

Project
Stake

Resources

Creativity

Uncertainty

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Project life cycle and

their effects (Figure 1.4)

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Project success rates

 Software & hardware projects fail at a 65% rate.
 Over half of all IT projects become runaways.
 Only 30% of technology-based projects and programs are a
success.
 Ten major government contracts have over $16 billion in cost
overruns and are a combined 38 years behind schedule.
 Only 2.5% of global businesses achieve 100% project
success and over 50% of global business projects fail.
(PricewaterhouseCoopers, 2004, 10.640 projects)
 More than $8 billion of $53 billion the Pentagon spent on Iraqi
reconstruction projects was lost due to fraud, waste, and
abuse.

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Project management
• In a project:
• If anything can go wrong, it will .
• Everything takes longer than you think.
(Murphy Laws)

• A carelessly planned project takes three times longer to

complete than expected; a carefully planned project will
take only twice as long.
(Golub’s Laws of Computerdom)
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Project success
• What is project success?
• Different models have been proposed to define it.
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Iron triangle of project success

Perfomance
(Quality)

Extended Iron Time Cost

Triangle includes
Customer
Satisfaction
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Quadruple constraint of project success

(Figure 1.6)

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Consider one example. In his book, What Customers Really Want, author Scott McKain
relates how a coach bus company that transports music stars was originally planning to
spend a great deal on a project to improve the interior of its vehicles, because they believed
that with these upgrades customers would be willing to pay more to lease or purchase their
buses.
However, prior to starting a full-blown overhaul of their fleet, the company’s executives
decided to ask past customers what they thought about this plan. Surprisingly, the company
found that while its customers did want nice interiors, the single most important factor in
selecting a coach company was the bus driver, who ideally would be a “nice guy,” someone
who could get the music stars to their destination safely, and who would also serve as a
good ambassador for the band with fans.

Based on this information, the company dropped its original project and instead initiated a
driver education program to teach its drivers how to communicate more effectively with
customers and how to retain and grow customer goodwill. The company also started
compensating drivers according to how well they served the customer and how well they
cultivated long-term relationships with them. Once the company did this, it moved from fourth
in the marketplace to first, and grew from 28 to 56 coaches.

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Four dimensions of project success

(Figure 1.7)

Another Approach

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Understanding success criteria (Table 1.2)

Iron Triangle Information Benefits Benefits (Stakeholders)

System (Organization)
Cost Maintainability Improved efficiency Satisfied users
Quality Reliability Improved effectiveness Social and environmental
impact
Time Validity Increased profits Personal development
Information quality Strategic goals Professional learning,
contractors’ profits
Use Organization learning Capital suppliers, content
Reduced waste Project team, economic
impact to surrounding
community

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Six criteria for IT project success

System Information
Use
Quality Quality

User Individual Organizational

Satisfaction Impact Impact

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Project management maturity

• Project management maturity (PMM) models
are used to allow organizations to benchmark
the best practices of successful project
management firms.
• Benchmark is something that can be used as a
way to judge the quality or level of other things.
• Benchmarking is the practice of systematically
managing the process improvements of project
delivery by a single organization in a period of
time.
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Spider web diagram (Figure 1.8)

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Spider web with embedded organizational

evaluation (Figure 1.9)

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Project Management Maturity Generic Model

(Figure 1.10)

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Developing project management maturity

Project Management Maturity (PMM) Models
• Center for Business Practices

• Kerzner’s Project Management Maturity Model

• ESI International’s Project Framework

• SEI’s Capability Maturity Model Integration

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CENTER FOR BUSINESS PRACTICES PMM

• Level 1: Initial Phase

• Level 2: Structure, Process, and Standards

• Level 3: Institutionalized Project Management

• Level 4: Managed

• Level 5: Optimizing

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KERZNER’S PMM MODEL

• Level 1: Common Language

• Level 2: Common Processes

• Level 3: Singular Methodology

• Level 4: Benchmarking

• Level 5: Continuous Improvement

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ESI INTERNATIONAL’S PROJECT FRAMEWORK

• Level 1: Ad Hoc

• Level 2: Consistent

• Level 3: Integrated

• Level 4: Comprehensive

• Level 5: Optimizing

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SEI’S CAPABILITY MATURITY MODEL INTEGRATION

• Level 1: Initial

• Level 2: Managed

• Level 3: Defined

• Level 4: Quantitative Management

• Level 5: Optimizing

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Project manager’s responsibilities

1. Selecting a team

2. Developing project objectives and a plan for

execution
3. Performing risk management activities

4. Cost estimating and budgeting

5. Scheduling

6. Managing resources
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Project Elements and Text Organization

(Figure 1.11)

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OVERVIEW OF THE PROJECT MANAGEMENT INSTITUTE’S PMBOK

KNOWLEDGE AREAS (FIGURE 1.12)

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Summary
1. Understand why project management is becoming
such a powerful and popular practice in business.
2. Recognize the basic properties of projects, including
their definition.
3. Understand why effective project management is such
a challenge.
4. Differentiate between project management practices
and more traditional, process-oriented business
functions.
5. Recognize the key motivators that are pushing
companies to adopt project management practices.

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Summary
6. Understand and explain the project life cycles, its
stages, and the activities that typically occur at each
stage in the project.
7. Understand the concept of project “success,”
including various definitions of success, as well as
alternative models of success.
8. Understand the purpose of project management
maturity models and the process of benchmarking in
organizations.
9. Identify the relevant maturity stages that organizations
go through to become proficient in their use of project
management techniques.
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