Project 1

11/19/2009
Pearson Education
Importance of Project Management

Due to the size, complexity, and number of information technology (IT) projects, organizations face ever-increasing challenges Global U.S. government spending topped $150 billion in 2007 Forrester Research estimates that global IT spendingpurchases of computers, software, and services by companies and governmentswill drop by 3 percent in 2009, to $1.66 trillion Forrester Research estimates that about 20 percent of current IT budgets are going into project development Gartner In a worst case scenario, our research indicates an IT spending increase of 2.3 percent in 2009, down from our earlier projection of 5.8 percent. Developed economies, especially the United States and western Europe, will be the worst affected, but emerging regions will not be immune. Europe will experience negative growth in 2009; the United States and Japan will be flat.
Richard Carlsson
Richard Carlsson, Jnkping International Business School
Pearson Education
Pearson Education
IT Projects Are Different

Traditionally high turnover rates of IT workers Level of uniqueness and complexity of each project due to the rapid changes in technology Software is hard to visualize by the developer let alone the customer Difficulty in getting accurate customer requirements Rate of change in requirements Difficulty in testing all the possible states of software Constant training needed to keep team members current with the technology
IT Projects Are Different

Category
Requirement Changes Source of Changes Requirements Uniqueness Resources Implementation Testing
Engineering/ Construction
Slow, incremental Known, predictable Explicit plan Higher commonality Stable Structured, controlled Defined, measurable
Information Technology
Rapid, unplanned Many times not known Often ambiguous Low commonality High turnover rates Often chaotic Difficult test all options
Pearson Education
Pearson Education
Advantages of Using Formal Project Management Practices

Improvement in customer satisfaction Better cost performance, higher return on investment Better schedule performance, better allocation of time commitments and better utilization of resources, higher productivity Increased quality reducing re-work Increase in delivering required features Will make everyone happier (stakeholders, team members, management)
History of Project Management

Modern project management began with the Manhattan Project, which the U.S. military led to develop the atomic bomb In 1917 Henry Gantt developed the Gantt chart as a tool for scheduling work in job shops In 1958, the Navy developed PERT charts In the 1970s, the military began using project management software, as did the construction industry By the 1990s, virtually every industry was using some form of project management
5
Jnkping International Business School
11/19/2009
Pearson Education
Pearson Education Pearson Education
What Is a Project?
A temporary sequence of related activities that must be completed to create a unique product or service Key Characteristics:
Temporary Unique Progressive Elaboration Single unique purpose
A Project Is Temporary
It must have a beginning and an end A project is done when one of the following occurs:
The projects objectives have been achieved, as agreed by the sponsor It has been determined that the projects objectives will not or cannot be achieved The need for the project no longer exists, and the project is terminated
Projects which continue but should be cancelled are referred to as Death March projects!
Pearson Education
Pearson Education
Projects Are Unique

Never been done before Must contain a well-defined purpose Because each project is unique, creates uncertainty and risk
Projects Are Progressively Elaborated

Refers to the idea that execution of the project occurs in steps (phases) or small increments, adding features and definition until the final objective is achieved Concept applies to the scope, time, and cost of the project
10
Pearson Education
Pearson Education
What Is a Project, continued

Secondary Characteristics:
Each project must have a primary sponsor or champion Projects usually cut across organizational lines requiring resources from several different sources They must do something, deliver something of value
A Project Manager Manages by:

Setting clear and achievable objectives Identifying requirements Adapting the project to the various concerns of the stakeholders Balancing the demands of the triple constraint
11
12
11/19/2009
Pearson Education
Triple Constraint
Every project is constrained by a list of customer-requested requirements (scope), the amount of time available to produce the system in support of the requirements (time), and the limit of money available (cost) Every project is constrained differently, according to the goals of the system owner (sponsor) and the project team
Triple Constraint
Time, cost, and scope are called the triple constraint
A change in one automatically changes at least one of the others
Scope
Time
Cost
14
13
Pearson Education
Pearson Education
Triple Constraint Juggling Act

Reducing time allowed will increase cost (especially if overtime is required) and may reduce the scope (functions and features) of the system Reducing costs (cutting the budget) will increase time (delay schedule) and may reduce the scope (functions and features) of the system Increasing scope (adding features) will certainly increase time and/or cost Reducing scope may reduce time and cost (and it may also negatively affect quality)
IT Project Management Success Rates
15
16
Pearson Education
Chaos Report Improvements

Better Project Management Iterative/Incremental Development Process Better PM tools and techniques Emerging Web infrastructure Better management processes CMMI and now OPM3 maturity models
Project Manager Skills

Soft skills:
Leadership Team building Negotiation Conflict management Organization for self and others Communication both oral and written to both technical and non-technical audiences Change management Active listening
17
Technical Skills:
Project Management software Level of understanding of the technology being used in the project (software, hardware, network, etc.) Basic knowledge of the business Cost estimating and budgeting
18
11/19/2009
Pearson Education
Pearson Education
Six Basic Functions of Successful PMs

1. manage project scope make sure the team works on what is 2. 3. 4. 5. 6.
Organizational Structures
Functional (traditional)
Organized around one of these characteristics: job function, end product, customer groups, a specific process, or geographic locations
needed for the project and nothing else manage human resources the team must work together, this doesnt just happen it takes a directed effort manage communications this occurs at many levels, teammates, customers, managers, vendors, and others manage schedule must keep people on schedule delivering work on time manage quality need to make sure that all work performed meets with customer expected levels of quality manage costs must keep an eye on the budget to make sure all the work can be done and not exceed the allocated budget
Project
Organized completely around projects and sometimes its mere existence is only for one particular project (the Olympic games for example)
Matrix (Weak, Balanced, Strong)

Combination of traditional and project
19
20
Pearson Education
Pearson Education
Organizational Structure Influences on Projects
Functional (Traditional) Structure
21
22
Pearson Education
Pearson Education
Functional (Traditional) Structure

Benefits:
Individuals can specialize and become very proficient in one
Project Organizational Structure
area
Communication channels are well established Good control over resources since they only have one boss Easier budgeting and cost control because all budgets
differentiated by defined department boundaries
Traditional advancement within the functional department
Drawbacks:
Project Manager holds the least amount of authority Potential underutilization of resources or misallocation of
resources
Economies of scale when sharing resources (people and
materials) across projects
Individual exposure outside of ones department limited Focus not always on the project
23
24
11/19/2009
Pearson Education
Pearson Education
Project Organizational Structure

Benefits: One manager has authority and accountability authority for work assignments and staff salary reviews communication channels are direct and open adaptability to changes is increased, decision making power is put in the hands of the project manager who is involved in the process daily can build up considerable expertise from repetition of similar technologies
Matrix Organizational Structure
Drawbacks:
Potential underutilization of resources or misallocation of resources Economies of scale when sharing resources (people and materials)
across projects
Project myopia, see only the project we are working on May be a lack of career progression possibilities (Flat structure) Support for administrative functions more difficult
*3 forms: weak, strong, balanced
25
26
Pearson Education
Pearson Education
Matrix Organizational Structure

Benefits:

Choosing the Correct Structure

Depends on:
The history of the organization The industry the organization is in Project characteristics The tendency of many organizations today is moving toward a matrix structure
Formal project accountability and visibility More dynamic and adaptable to change Sharing of knowledge across projects is enhanced Policies and procedures can vary across projects Less stress about the project ending Drawbacks: Multiple supervisors with competing priorities Budget and cost control becomes more difficult Project Team motivation
who do I listen tomy boss who controls my salary or to the project
manager who is giving me work assignments Policies and procedures can vary across projects
27
28
Pearson Education
Projects Cannot Be Run In Isolation!

Projects must operate in a broad organizational environment Project managers need to take a holistic or systems view of a project and understand how it is situated within the larger organization
29
30
11/19/2009
Pearson Education
Pearson Education
For Example:
The sales and marketing department has approached the IT department about adding a shopping cart feature to the Web site. It would allow customers to place orders online, adding and removing items until they are ready to process their order (check out). The IT department is very excited because it would be a very cool technology to work with and put on the site But, someone, ideally senior management and the project manager, needs to take a step back and ask
Questions Needing Answers

Before we implement that feature, we need to examine how this will affect and be affected by other projects already underway? What are our competitors doing? When should this be done in relation to other projects waiting to start? What legacy systems must we interact with?
31
32
Project Management Impact
Pearson Education
Pearson Education
Organizations are Open Systems They must interact with the environment to survive Managers must: Appreciate the need to assess forces in the environment Understand the forces that significantly affect their organization Integrate these forces into the organizations goals, objectives, and operations Role of the Project Manager Every project is influenced by outside forces, these alone should not be allowed to dictate the conduct of the project Must manage the behavioral and social aspects of the project
Systems Approach
Emerged in the 1950s to describe a more analytical approach to management and problem solving Three parts include:
Systems philosophy: View things as systems, interacting components working within an environment to fulfill some purpose Systems analysis: problem-solving approach Systems management: Address business, technological, and organizational issues before making changes to systems
33
34
Pearson Education
Pearson Education
The Project Management Systems Approach:

1. First take on a systems philosophy,
Good Project Managers Must

Appreciate the need to assess forces in the environment Understand the forces that significantly affect their organization Integrate these forces into the organizations goals, objectives, and operations
understand the environment 2. Then conduct your systems analysis and finally 3. Perform systems management
(responsible for the management of the whole systemobjectives, environment (both internal and external), constraints, resources (both human and other), and the culture and social environment of the organization. This is what project management is all about)
35
36
11/19/2009
Pearson Education
Generic Iterative Life Cycle with Six Phases
2-37
Richard Carlsson, Jnkping International Business School Richard Carlsson, Jnkping International Business School
38
IT Projects are Difficult

Although reports vary considerably, IT projects
Goal of IT Project Management

Overall goal of project management is to deliver a quality system on schedule and on budget that meets the needs of the business
IT Project Management Goal
Scope Time Cost
fail frequently
According to the Standish Group, the failure rate may
approach 2/3 of IT projects

Sauer, Gemino, and Reich (2007) report much lower IT
project failure rate with over 2/3 of projects delivered close to on-time and on-budget
Organizational IT project management greatly
affects the success of IT projects

39
40
Project Management Institute

The PMBOK Guide contains nine areas of competency
1. 2. 3. 4. 5. 6. 7. 8. 9.
Strategic Management of IT
IT project prioritization scheme
During the evaluation of IT projects, a categorization scheme is usually used to assist managers in their decision making The Denis et al. (2004) scheme:
Absolute Must
A mandate due to security, legal, regulatory, or endof-life-cycle IT issues
Project Scope Project Time Project Cost Human Resources Quality Management Risk Management Project Communications Procurement Project Integration
41
Highly Desired / Business-Critical

Includes short-term projects with good financial returns and portions of very large projects already in progress
Wanted
Valuable, but with longer time periods for returns on investment (more than a 12-month period)
Nice to Have
Projects with good returns, but with lower potential business
42
11/19/2009
MoSCoW Rules
M = Must Haves S = Should Haves C = Could Haves W = Won't Haves
Project Management Roles

Project Manager (PM)
Typically systems projects are lead by IT project
managers who possess technical knowledge and project management skills A project managers main responsibility is to plan and execute the project The following non-technical skills are important for successful project management:
43
Figure 12.3
44
Project Management Roles

Project Sponsor
Typically a business manager who owns the project (the sponsor is paying for the project) The sponsor has several responsibilities to the project:
Fights for project approval Ensures project resources
Funding Project team members
Project Sponsor
Tasks to Engage Sponsor
Schedule regular meetings with the sponsor to ensure the project is on track, according to current business priorities Create a list of expectations with the sponsor to clarify the project manager role and the sponsors role Agree on how handoffs between the project manager and sponsor will occur Discuss the sponsors preferences for when and how project issues will be brought up with the sponsor Learn how the sponsor will communicate the status of the project to peers and the companys top management Determine what metrics the sponsor will use to judge the completion of the project Agree on how the sponsor will participate in the post-project review
45
It is critical for the project manager to have a strong relationship with the sponsor
46
The Project Life Cycle

All successful projects pass through four generic phases along the path to completion We will discuss all four of the project phases because all are crucial to project success
Project Execution and Control
Project Initiation
The first step in the project life cycle is project initiation The main deliverable for this phase is the project charter
Project Charter
Project Initiation
Project Planning
Project Closing
A document that describes a projects objectives, scope, assumptions, and estimated benefits
Project Initiation Project Planning Project Closing
48
47
11/19/2009
Project Initiation
Many dimensions of project feasibility are likely to be assessed in this phase
Economic Does this project give a positive financial return? Operational How will the project impact the organizations operations? Technical Does the organization have the technology and expertise required? Schedule Is it possible to finish the project in the required schedule? How is the projects schedule impacted by other timelines? Legal or contractual Does the project have any legal conflicts? Political Is there support for the project from the relevant stakeholders?
Project Planning
The second phase of the project life cycle is
project planning The primary deliverables for this phase of the project are the statement of work and project plan There are three major components of this phase
1. Scheduling 2. Budgeting 3. Staffing
Project Initiation
49
Project Planning
Project Closing
50
Project Planning
1. Scheduling
Project Planning
2. Budgeting
The first step of scheduling is generally a work breakdown analysis

Work Breakdown Analysis A basic management technique that systematically subdivides blocks of work down to the level of detail at which the project will be controlled
Approaches to estimating
Bottom-up
Based on work-breakdown Used with not enough is known about the project to create a work-breakdown
Top-down (parametric estimating)
Once the work is broken into tasks, time estimates are assigned to each task based on past experience It is important to consider task dependencies when creating the master schedule with project milestones
51
Inexperienced cost estimators often make the following mistakes:

Too optimistic in their assessments Leave components out that should be estimated Do not use a consistent methodology
52
Project Planning
2. Budgeting

Project Planning
3. Staffing

Purposeful inaccurate estimations of the budget can have adverse effects Highballing (or budget padding)
Overestimation of project costs Projects may not be approved because of higher costs
To succeed, a project must contain the right IT skills mix of the professionals assigned to the project An effective project manager must have the ability to estimate the skill type, proficiency level, quantity, and time required for personal to complete project tasks Some staff may require training for the project
Some organizations have created Centers of Excellence where employees can learn additional skills that may be required for future projects
Lowballing
Underestimating project costs Used to gain approval of questionable projects Often lead to project failures when overbudget
53
Outside contractors
Important to transfer knowledge from contractors to employees to remove dependency
Teambuilding Incentives
54
11/19/2009
Project Planning
3. Staffing
One method of obtaining skilled professionals is to utilize outside contractors
It is important for organizations to transfer knowledge from contractors to employees to remove future dependency on the contractors This can increase project risk because of uncertainty in the contractors expertise and behavior
Project Planning
Program Evaluation and Review Technique (PERT) or Critical Path Method (CPM)
Figure 12.5
55
56
Project Planning
Gantt Chart

Figure 12.5
The third phase of the project life cycle The deliverable for this phase is the completed project Most projects exhibit the following characteristics
1.
Risk and uncertainty are highest at the start of the project 2. The ability of the project stakeholders to influence the outcome is highest at the start of the project 3. Cost and staffing levels are lower at the start of the project and higher toward the end
Project Initiation Project Planning
Project Closing
58
Figure 12.6 (Valacich, George, and Hoffer 2001)
57

Communication with stakeholders is critical Status reporting should be simple and clear
Managing Project Risk
All projects carry risk and some IT projects (e.g., enterprise projects) involve considerable risk of failure Early warning signs of project failure
Figure 12.7 (Roman 1986)
Figure 12.8 (Kappelman et al. 2006)

59
60
10
11/19/2009

Managing Project Risk
The risk exposure profile changes over time
Risk decreases over time as the organizations stake increases

Managing Business Change
New systems can lead to major changes in business processes Due to these changes, IT projects often require change management to overcome resistance to the new system
Change Management The ability to successfully introduce change to individuals and organizational units
Figure 12.11 (Frame 1994)
61
62
Project Closing
Even when the project deliverables are complete, successful organizations include a final closing stage to review project success A post-project review is used to share lessonslearned during the project
Typical questions during this phase may include: What went right on this project? What went wrong on this project? What would you do differently on the next project, based on your experience with this project?
Project Initiation Project Planning
Theory X and Theory TheoryY Y

Theory X Dislike work Lazy Dislike responibility Theory Y Like to work Creative Seek responsibility
Manager?
Project Closing
63
64
Communication
Written Oral Nonverbal When How What
Project Meeting
Before Define purpose Who? Distribute agenda Prepare After Notes (iteration) Actions Send to all
65
Formal Informal
Vertical Horizontal
During On time Take notes Stay on topic!! Visual presentation Summarize (disagreements?) Action!
66
11
11/19/2009
Conflict intensity
Overt effort to destroy Functional conflict Dysfunctinal conflict PERSONAL CONFLICT!!! Verbal attacks Overt questioning or challenging Minor disagreement or missunderstandings
Scope of Project
Aggressive physical attacks Threats and ultimatums
What is the scope of the project? Start- and finish date? What resources are available? Is there a clear and concise Project Objective Statement (POS)? Have the major deliverables been well defined? Is there a written Is/Is Not list for each deliverable? Do the major deliverables have target completion dates?
67
Robbins and Judge, 2007
68
POS
A good project objective statement..
Is captured in maximum 25 words Uses plain language, avoiding jargon and acronyms Is clear and concise Is visionary and creates challenge/excitement
Closing project
End Report Handover!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! What have we learned?
Put a man on the moon and return him safely by December 31, 1969, at a cost of $9B.
Kick-down (f-off)
69
70
PostPost -Project Reviews

Identify areas for improvement in future projects
Project Termination
Serious cost and schedule overrun Technical risks too great Customer strategy has changed Competition has make the project obsolete The purpose has changed
71
72
12

Project 1

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Project 1

Uploaded by

Copyright:

Available Formats

11/19/2009

Importance of Project Management

Richard Carlsson, Jnkping International Business School

Richard Carlsson, Jnkping International Business School

IT Projects Are Different

IT Projects Are Different

Richard Carlsson, Jnkping International Business School

Advantages of Using Formal Project Management Practices

History of Project Management

Jnkping International Business School

Pearson Education Pearson Education

Richard Carlsson, Jnkping International Business School

Projects Are Unique

Projects Are Progressively Elaborated

Richard Carlsson, Jnkping International Business School

Richard Carlsson, Jnkping International Business School

What Is a Project, continued

A Project Manager Manages by:

Richard Carlsson, Jnkping International Business School

Richard Carlsson, Jnkping International Business School

Jnkping International Business School

Richard Carlsson, Jnkping International Business School

Triple Constraint Juggling Act

IT Project Management Success Rates

Richard Carlsson, Jnkping International Business School

Chaos Report Improvements

Project Manager Skills

Richard Carlsson, Jnkping International Business School

Jnkping International Business School

Six Basic Functions of Successful PMs

Matrix (Weak, Balanced, Strong)

Richard Carlsson, Jnkping International Business School

Richard Carlsson, Jnkping International Business School

Organizational Structure Influences on Projects

Functional (Traditional) Structure

Richard Carlsson, Jnkping International Business School

Richard Carlsson, Jnkping International Business School

Functional (Traditional) Structure

Project Organizational Structure

differentiated by defined department boundaries

Traditional advancement within the functional department

Economies of scale when sharing resources (people and

materials) across projects

Richard Carlsson, Jnkping International Business School

Jnkping International Business School

Project Organizational Structure

Matrix Organizational Structure

*3 forms: weak, strong, balanced

Richard Carlsson, Jnkping International Business School

Matrix Organizational Structure

Choosing the Correct Structure

Richard Carlsson, Jnkping International Business School

Projects Cannot Be Run In Isolation!

Richard Carlsson, Jnkping International Business School

Richard Carlsson, Jnkping International Business School

Jnkping International Business School

Questions Needing Answers

Richard Carlsson, Jnkping International Business School

Project Management Impact

Richard Carlsson, Jnkping International Business School

The Project Management Systems Approach:

Good Project Managers Must

Richard Carlsson, Jnkping International Business School

Jnkping International Business School