Project Management

Kaushik Banerjee
Systems Life Cycle
 Project Life Cycle
• Create a new one or improve an existing one
• A starting point and an end point

• Measure:

Time
Cost
Performance
 System Development Life Cycle
A) Phases
A. Conception
B. Definition
C. Execution
D. Operation
Phases interact and might overlap
Go/NoGo decision: Entry/Exit criteria]
 Different phases may be by different organisations
Several projects may combine to form a Programme
 System Development Life Cycle

All activities may not always be explicit, e.g. proposal;

 System Development Life Cycle
Stakeholders
 Phases

Phase A: Conception

Procurement Management  Request for

Proposal  Feasibility Study  Proposal/Letter
of Interest  Comparison  Negotiation 
Award  Agreement
 Phases

Phase B: Definition

Major subsystems and components are identified

Plan with budget, resources, costs, activities,

schedules
 Phases

Phase C: Execution: Acquisition: System goes

into production

Phase D: Operation: Deployment: Customer

takes over the system and maintain it.

Last for several years, may be a decade

 System Development Life Cycle

Phased Project Planning and Fast Tracking

Project Methodologies

Systems Development Life Cycle, Systems

Engineering and Project Management: They
are similar in nature, varying only in scope
Conception
 Conception: Feasibility
Feasibility is the process of studying a need, problem, and solutions in
sufficient detail to determine if the idea is economically viable and worth
developing. The initial investigation is a form of feasibility study, a pre-
feasibility study, which itself is usually rather cursory, and hence
insufficient to commit to a project. A feasibility study is a more
protracted, rigorous study that considers alternative solutions (system
concepts) and the benefits and costs of each. The customer typically
performs the feasibility study, but usually hires outsiders (contractors) to
do it if the study requires special expertise. Deciding to build a new
airport, power plant, highway, or tunnel are examples where the
feasibility studies are themselves big, expensive projects undertaken by
outside contractors. In such cases, a pre-feasibility study is normally
undertaken.
 Conception: Feasibility

If the feasibility study indicates that the concept is

viable, one of two things happens

•Theme A: if the concept is something the customer can

handle itself, it is passed along to an internal group for
development and execution

•Theme B: if the concept cannot be executed internally,

it is given to outside contractors (SDOs).
Conception: Feasibility
 Conception : Feasibility
Request for Proposal
The RFP—request for proposal (or request for bid, request for
quotation, invitation for bid (IFB), or similar term) is a document the
customer sends to potential contractors telling them the customer has a
problem or need, and wants to hire someone. In the RFP, the customer
describes his problems, objectives, and requirements.

The dual purpose of the RFP is to outline the user’s need (problem,
idea, etc.) and to solicit suggestions (proposals) for solutions—usually
with the intent of awarding a contract. The customer sends RFPs to
contractors on its own bidders list. Contractors not on the bidders list can
learn about RFPs and upcoming jobs in newsletters and bulletins, and
request RFPs from customers. For example, Commerce Business Daily is
a publication that gives a synopsis of all federal jobs over $10,000.
Businesses scan the jobs and request RFPs for those they might be
interested in bidding on.
 Conception : Feasibility
Request for Proposal
 Conception : Feasibility
Feasibility Study
As mentioned, a feasibility study can be performed at
multiple times and with dif-ferent parties in a project:
minimally, the customer performs a study to determine
whether the project is worth supporting; if the project work
is to be done externally, the contractor also performs one
to determine whether the job is worth pursuing. In this
section we consider the latter, although the same steps
described apply equally to the customer or anybody doing
a feasibility study.
 Conception : Feasibility
Feasibility Study
The statement of the problem as defined in the RFP is
frequently incomplete, vague, or even incorrect. If an RFP
has been received it will likely contain such a state-ment.
Thus, one of the contractor’s first steps in responding to
an RFP is to develop a definition of the problem that is
more concise, accurate, and complete than the one in the
RFP.
 Conception: Feasibility
Needs Definition
1. Ask the user to state the needs as clearly as possible.
2. Ask the user a complete set of questions to further elicit the
needs. For example: Are these real needs, or are there other,
more fundamental ones?
•Are the needs important enough to pursue?
•Are we capable of fulfilling these needs, or is someone else
better suited? If the needs are fulfilled, will they give rise to
other needs?
•Will satisfying these needs also satisfy other needs too?
•What effect do the unmet needs have on the organization and
the user? What other parties are affected by these needs, and
how will they react to our efforts?
 Conception : Feasibility
3. Conduct research to better understand the needs. “Research”
means probing to gather whatever information necessary to better
understand needs, define problems, and propose solutions.
Information sources include interviews, reports, memos,
observation, and models, and analysis of technical data and
empirical test results.
4. Based on information from Steps 2 and 3, restate and document
the needs.
5. Give the restated needs to the user. The previous steps are
repeated as often as necessary, concluding with a statement of
needs that the user accepts and that best represents the user’s
interests (rather than the interests of the contractor or other
parties).
Since every project is an effort to fulfill needs, a clear, well-stated,
and correct needs statement is necessary to avoid a project that is
meandering or irrelevant. But attaining such a needs statement is
not easy.
 Feasibility: User Requirement
Requirements for Objectives and Life Cycle
Every project and the end-item system to which it is
directed starts with a statement of objectives that
elaborate on the needs and provide the basis for defining
requirements.
Requirements for Operational Modes
Included in this life-cycle thinking are the different ways and
kinds of environments in which the system will be used or
operated; these are referred to as operational modes.

Requirement for Constraints and Interfaces

 Conception: The Current System
Conceptually, a need arises because of inadequacies within the
current system; a gap exists between the capability of the
current system and a desired capability.

A purpose of the feasibility study is to fully understand and

document the current system, including its inputs, outputs,
functions, flows, subsystems, components, relation-ships,
attributes, resources, and constraints.
Conception: Alternative Solutions
Conception: Analysis
Conception : Environmental Impact
Conception: The Project Proposal
 Conception: The Project Proposal
Proposal Preparation
 Conception: The Project Proposal
Proposal Preparation
 Selecting the Winning Proposal

In general, selection of projects is based upon

consideration of the following factors:

•Project price
•Solution’s ability to satisfy stated needs (solution or
technical approach)
•Return on investment
•Project plan and management
•Qualifications and reputation of contractor
•Likelihood of success or failure (risks)
•Fit to contractor resources and technological capability.
Selecting the Winning Proposal
Selecting the Winning Proposal
Selecting the Winning Proposal
Selecting the Winning Proposal
 Selecting the Winning Proposal
Sometimes the contract award depends more on the
contractor’s qualifications than on the proposed solution.
Among factors the customer might consider are the
following:
Is the contractor big enough to do the project?
Is it adequately financed to do the project?
Does it have a good track record with this kind of project?
Does it have a good reputation in the industry?
Has it been involved in litigations and arbitrations?
Will its management be accessible?
Does it have ISO 9000, ISO 14000, or other certification?
Will the relationship with the contractor likely be amicable
or touchy?
 Project Initiation: Variations on a Theme

Projects are always initiated in response to a need, but they do

not always involve an RFP or even a proposal. The RFP/proposal
process as described largely applies to projects where the work is
contracted out; i.e., where the customer and the contractor are
not in the same organization. For internal projects—projects
where the organization has the capability to perform the work on
its own—initiation is with a business case study.
 Project Initiation: Variations on a Theme

Common examples of this are projects in product development

(PD) and IT—two areas where companies often exhibit significant
internal prowess. In PD, the “need” is manifest as the desire or
mandate to fill a perceived market niche or respond to a
competitive threat. The business case study, similar to a feasibility
study, analyzes the market, competition, product alternatives, risk,
cost, and returns, and argues in favor of launching a new PD effort.
If the business case is approved and funded, the project is turned
over to the PD department to begin work. The business case study
serves as feasibility study and project proposal combined.

Business case studies are similarly used to initiate IT projects.

 PROJECT CONTRACTING
Contracting Environment and Process

Most projects, even internal ones, involve some

degree of external, legal contracting because
the customer often must hire someone
externally to perform at least some of the
work. In many projects, everything in the
project is done or provided by external
organizations.
PROJECT CONTRACTING
 PROJECT CONTRACTING
Sub-Contracting

Even a contractor that is capable of doing all the

work itself may choose to sub-contract because it has
limited capacity or facilities, or believes a
subcontractor could do the work for lower cost.. For
development projects of large-scale systems, the
prime contractor will usually design the overall system
and major subsystems, and will produce some
elements of the system itself but subcontract the
production of all others.
 PROJECT CONTRACTING
Contract Negotiation
Fixed Price Contract

Cost-Plus Contract: The price paid is based on the costs

incurred in the project plus the contractor’s fee.

Incentive Contract: The amount paid depends on the

contractor’s performance in comparison to the target price,
schedule, or technical specification: the contractor either
receives a bonus for exceeding the target or must pay a penalty
for not meeting it.
.
 PROJECT CONTRACTING
Contract Statement of Work and Work
Requisitions
Contract
. statement of work (CSOW) defines the expected
performance of the project in terms of scope of work,
requirements, end-results, schedules, costs, and so on.
The CSOW clearly specifies the conditions under which
the deliverables or end-results will be accepted by the
customer. Failure to clearly state these conditions can
lead to later disputes and delays in completing the
project.
 PROJECT CONTRACTING
The typical contract includes the following:

• Scope of work to be done or items to be sold

• Duties of the contractor in providing the work or items.
.
• Time schedule allowed.
• Payments milestones.
• How changes to the contract will be handled.
• How disputes will be handled.
• The way risks will be handled,
• Warranties, penalties, or bonuses/ incentives.
 PROJECT CONTRACTING