TOPIC A

Identify Project Management Basics

You want to plan and implement projects that
will positively impact your organization. A
thorough knowledge of projects and project
management is required to efficiently
manage your projects. In this topic, you will
identify basic concepts and terminology of
project management.
Business organizations around the world are
using project management as a competitive
advantage to achieve corporate strategic
objectives. By identifying the main elements
involved in project management practices,
you can enhance the chances of success
over a wide range of projects across
application areas and industries.
Projects
A project is a temporary work endeavor that
creates a unique product, service, or result. It
has a clearly defined start and finish. The
end of a project is reached when its
objectives are met, the need for the project
no longer exists, or it is determined that the
objectives cannot be met. Projects require
resources to perform project activities and
lend themselves to a teamwork structure
because they draw from a range of
disciplines to complete the work. Also,
projects vary widely in terms of budget, team
size, duration, expected outcomes, and
industries. A project is considered to be
successful when the specified objectives are
met within the specified duration and budget
and with the required quality.
Example: The Intranet Website Creation
Project
Consider a project authorized by a firm to
create an intranet website that will display its
employees' information. The outcome of the
project is the website, and the duration will
depend on the complexity and size of the
work involved. The project will come to an
end when the website is posted on the
server and is ready for use by appropriate
users.
Subprojects
A subproject is an independently
manageable component of an existing
project. A project can have
multiple subprojects and they in turn can
have even smaller subprojects. Usually, a
subproject is
given on contract either to an external
enterprise or to another functional unit in the
organization.
Example: Subprojects in a Car Project
The project team working on the interior
design of a solar-powered car decided to
subcontract the
designing of seats and the air-conditioning
system to two individual external vendors as
subprojects.
Project Management
Project management is the planned effort for
executing and monitoring a project in order
to accomplish its defined goals and
objectives. Managing projects involves
scheduling; identifying requirements;
establishing objectives; balancing quality,
scope, time, and cost; and addressing the
concerns and expectations of stakeholders.
Project management is different from the
management of routine, ongoing work
initiatives called operations. Projects
generally involve temporary initiatives,
unique circumstances, and cross functional
teams. Projects may involve new or specially
formed teams taking on new tasks and
attempting unfamiliar skills, processes, or
work efforts. Operations, on the other hand,
deal with the ongoing day-to-day production
of goods and services. Operations
management includes such disciplines as
human resources, purchasing, sales, and
maintenance.
Responsibilities of a Project Manager
In any given project, some of the common
responsibilities of project managers include
communicating cross-functionally, managing
the efforts of the team members who do not
report directly to them, and delivering work
on time, within the allotted budget and
specifications for quality.
Note: The project manager's roles and
responsibilities will be discussed in detail
throughout this course.
Programs
A program is a group of related projects that
have a common objective. It offers great
control over constituent projects and delivers
benefits that the organization can use to
meet its goals. A program is managed by a
program manager, and individual projects
are managed by project managers who work
for the program manager. However, all
projects need not always be a part of
programs.
Projects that do not have a common
objective, but still are managed in a group,
are generally known as multiple projects.
Example: A Computer Service Expansion
Program
A computer servicing firm launched a new
program that aims at expanding its business.
This expansion program consists of many
projects such as market research to
establish demand,construction of new
branch stores, franchise selection, designing
the marketing campaign, and consolidation
of customer base by establishing loyalty
programs.
Portfolios

A portfolio is a collection of projects,

programs, and operational work to achieve
the strategic business objectives of an
organization. The projects in a portfolio may
or may not be interdependent, but they are
grouped to give management a broader view
of the organization's projects and their
adherence to organizational objectives. For a
project to be part of a portfolio, its attributes
such as cost, resource requirements,
timelines, strategic goals, and benefits
should be in line with other projects in the
portfolio. Portfolios are generally managed
by a senior manager or senior management
teams.
Example: A Company Portfolio
An alternate energy producing company
designed a breakthrough technology
capitalizing on solar energy. The company's
strategy is to exploit the technical know-how
in all possible areas to generate revenue and
become a trendsetter. It initiated a portfolio
that contains various programs and
independent projects to identify the potential
use of this technology in power generation,
transportation, and domestic and industrial
markets. The portfolio also included other
operational work such as administration- and
logistics-related activities. It is essential for
the company to ensure
that the operational work continuously
supports the projects and programs.
Programs vs. Portfolios
Program management includes related and
interdependent projects, whereas a portfolio
may include several otherwise unrelated
projects if they all support major goals or a
significant product line.
Operations
Operations are ongoing, repetitive tasks that
produce the same outcome every time they
are performed. The purpose of operations is
to carry out day-to-day organizational
functions, generate income to sustain the
business, and increase the value of
organizational assets. Operational processes
are aligned with the business requirements
of an organization. Therefore, when
organizations update or adopt new
objectives based on organizational needs,
customer requirements, or market demand,
these processes are continuously revised to
accommodate the changes.
The following table highlights the differences
between projects and operations.

Projects
Operations

One-time effort
Ongoing effort
Unique product or service
Repetitive product or service

Example: Operations in a Computer

Manufacturing Company
In order to meet its increasing customer
demands, a computer manufacturing
company decided to open a new
manufacturing facility. Construction of the
facility would constitute a project, and when it
opens, everything from that point forward
would be an operation. The company plans
to reach a break-even point in three years by
achieving the desired volume of output from
its new facility. The operations to be carried
out in the new facility include daily
production, routine maintenance, wages and
salary credits to employees, grievance
handling, logistics, and supply of finished
products to the market.
The PMO
The Project Management Office (PMO) is a
centralized, permanent, ongoing
administrative unit or department that serves
to improve project management performance
within an organization. The people in the
PMO provide support for project
management concepts, tools, training, and
mentoring to project managers; they may or
may not actually do hands-on project
management themselves. The PMO will try
to maintain standards across projects,
provide governance, and improve efficiency.
It has the authority to make key decisions in
the projects. In some organizations, the
project managers are provided, or assigned,
by the PMO.
PMOs function differently in different
organizations, depending on the business
needs. Unlike programs, the projects
supported by the PMO may not be related to
each other. The structure and function of the
PMO depends upon the respective
organizational requirements. In some
organizations, the PMO may be referred to
as the “project office,” “program office,”
“central project office,” “project management
center of excellence,” or “program
management office.”
Some of the primary functions of the PMO
include:
• Maintaining project historical information.
• Managing shared resources across projects
managed by the PMO.
• Monitoring project timelines, budget, and
quality at an enterprise level.
• Identifying and implementing new project
management methodologies.
• Creating effective project policies,
documentation, and templates.
• Helping project managers develop
estimates and schedules.
• Conducting routine quality assurance
reviews.
• Managing communication across projects
under the PMO.
The PMO may publish their policies,
templates, and other documentation on an
intranet site, or in a Wiki library. The Wiki can
be structured to provide links to specific
procedures that should be followed to
comply with the directives of the PMO.
Example: A PMO at a Broadband Services
Company
A broadband services company identified a
business need to introduce a faster, more
convenient, and cost-effective service to its
customers. The project managers at each
broadband exchange came out with new
processes and economies of scale to
improve the performance of the system. In
this case, the PMO introduced standardized
processes for calculating, leveling, loading,
and developing project budgets and helped
the project managers with updating the
project schedules. The PMO also planned for
developing project data references and
organized a best practices sharing session
every month.
Project Stakeholders
A project stakeholder is a person who has
a vested business interest in the outcome of
a project or who is actively involved in its
work. Stakeholders take on various roles and
responsibilities; their participation in the
project will have an impact on its outcome
and its chances of success.
Stakeholders may have competing interests,
needs, priorities, and opinions. They may
have conflicting visions for the project's
successful outcome. Project managers must
identify internal and external stakeholders as
early as possible, learn what their needs are,
and secure their participation in defining the
project's parameters and success criteria.
While it may be difficult to negotiate to a
consensus early in the project, it is far less
painful and costly than getting to the end of
the project only to learn that someone's
needs were not met or were misunderstood.
Example: Project Stakeholders Involved in
Constructing a Power Plant
An alternative energy producing company
initiated a new project to harness geothermal
energy by building a power plant to utilize the
energy for electricity generation.
Stakeholders for this project included the
staff, management, and owners of the
company; local and statewide elected
officials; the licensing agencies; and
engineers, architects, and construction
workers employed by the project.
Project Stakeholder Types
The following table describes the common
types of project stakeholders and their
responsibilities.

Project Stakeholder Description

Customers/end-users Customers are

individuals or organizations who will receive the
product or
service generated by the project.
Customers can provide some of the resources of
an external project. Some
of their responsibilities include:
• Defining the needs
for the project output.
• Delivering the project
output.
• Paying for the project
output.
Additionally, the
customer might also
be the end-user
who will be affected
by the product or
service generated by
the project.

Sponsor/champion Sponsors may be

individuals or groups that provide finances,
management
support, and overall control
of the project. The sponsor
may be internal or external to
the organization. The
sponsor:
• Has the financial
resources for the
project.
• Signs and publishes
the project charter.
• Approves initial
project baselines, and
changes to baselines.
• Has the ultimate
responsibility for the
project's success.
• Signs off
on all planning
documents,
including
requirements,
business case
and scope, and
change
requests.
• Authorizes the team
to use resources.
 • Champions and
supports the project
manager and team.
• Reviews progress and
quality.
• Cuts through
red tape, helps
deal with
roadblocks, and
expedites
activities.
• Helps the
project manager
"market" the
project to
stakeholders who
may not see the
benefit of it.

Portfolio managers/
Portfolio review board Portfolio managers or
executives in the
portfolio review board
are a part of the
project selection
committees and belong
to the high-level
project governance
side of the
organization. Their
review considerations
may include:
• Gauging the Return
on Investment (ROI)
of the project.
• Identifying the
value of the project.
• Analyzing the risks
involved in taking up
the project.
• Identifying the
factors that may
influence the project.

Program managers Program managers,

in coordination with the project managers, manage
related projects in a
program to obtain
maximum benefits. They
also provide guidance and
support to every individual
project.

Project Management Office(PMO) A PMO is an

administrative
unit
that
supervises
and
coordinates
the
management
of all
projects
 in an
organization.
It
focuses
on
providing:
•

Administrative
support
services,
which
include
processes,
methodologies,
policies,
standards,
and
templates.
•
Any
key
performance
indicators
and
parameters
that
will
allow
projects
to
measure
their
success.
•
Training
and
mentoring
support
to
project
managers
and
project
team
members.
•
Support
and
guidance
in
managing
projects
and
usage
of
tools.
•
Support
for
resource
allocation.
•
Assistance
in
better
communication
among
project
 managers,
sponsors,
and
other
stakeholders.

Project managers Project

managers
are
individuals
responsible
for
managing
all
aspects
of
the
project.
The
project
manager:

•
Works
with
stakeholders
to
define
the
project.
•
Plans,
schedules,
and
budgets
project
activities
with
team
input.
•
Works
with
the
team
to
carry
out
project
plans.
•
Monitors
performance
and
takes
corrective
action.
•
Identifies,
monitors,
and
mitigates
risks.
•
Keeps
the
sponsor
and
the
 stakeholders
informed.
•
Requests
and
documents
scope
changes.
•
Provides
timely
reports
on
project
metrics.
•
Acts
as a
liaison
between
the
project
team
and
other
stakeholders.

Project management team

The project
management team are
t those
members of the project team
who
perform
management
activities,
such
as:
•

Acting
as
the
procurement
manager
for
projects
that
involve
multiple
contracts
and
vendors.
•

Being
responsible
for
inputting
data
into
the
Project
Management
Information
System
(PMIS)
and
confirming
 the
accuracy
of
that
data.
•
Assuming
the role
of
Project
Manager
in his or
her
absence.

Project coordinator
The project coordinator role exists
when the
organizational
structure
does
not
warrant
or
support
a
full-
scale
project
manager.
The
project
coordinator
has
limited
decision-
making
responsibilities.
This
role
requires
cross-
functional
coordination
and
duties
can
include:
•
Administrative
support and
documentation
assistance.
• Time and
resource
scheduling.
• Quality
control
checking.

Scheduler The scheduler creates

and maintains the project timeline. The scheduler is
proficient at using project
management software such
as Microsoft® Project and
other applications. Other
duties might include:
 • Communicate
timeline and schedule
changes.
• Monitor schedule
status and solicit task
status from resources.
• Report schedule
performance.

Project team The project team

comprises the project manager, the project
management
team, and other
individual team
members. The
individual team
members perform
project work and
may not be
involved in the
management side
of the project. The
project team
contains people
from different
groups who possess
knowledge on
specific subjects or
have unique skill
sets to carry out
project work. The
project team's
duties include:
• Use expertise to
contribute to
completing project
tasks.
• Contribute
deliverables on
schedule.
• Provide estimates of
task duration.
• Provide estimates of
costs and dependencies.

Vendors and business partners Vendors are

external parties who
enter into a contractual
agreement with the
organization and
provide components or
services needed for the
project. Seller,
contractor, and supplier
are also used when
referring to vendors.
In the same way,
business partners are
external to the company
and provide specialized
support to tasks such as
installation,
customization, training,
or support.

Functional managers Functional managers

are individuals who provide resources (people) to the
 project manager,
who in turn assigns
them to project
activities. Examples of
functional managers
are engineering
managers, IT
managers, and other
department heads.
They sometimes act as
subject matter experts
or may provide
services needed for
the project.

Operations managers Operations managers

manage the core business areas such as the design,
manufacturing, provisioning,
testing, research and
development, or
maintenance side of the
organization. Some of their
functions include:
• Directly
managing the
production and
maintenance of
the final
products and
services that the
organization
provides.
• Handing off
technical project
documentation and
other records to
the operations
management group
upon project
completion.

Positive and Negative

Stakeholders
Positive stakeholders usually benefit from
the successful outcome of a project,
whereas negative stakeholders see
negative outcomes of a successful project.
A good example of positive stakeholders is
business leaders from a community who
benefit from an industrial expansion
project because it involves economic
growth for the community. In this scenario,
the negative stakeholders will be the
environmental groups who are more
concerned about the environment and will
consider the project as harmful to the
environment.

Furthermore, the positive stakeholders can

go to the extent of getting the needed
permits to proceed with the project because
they are more interested in the project's
success. But, the negative stakeholders can
block the progress of the project by
demanding more environmental reviews.
The Project Manager Role
Project managers are responsible for
meeting project objectives and their job role
is different from that of a functional or
operations manager. Based on the
organizational structure, a project manager
may report to a portfolio or program
manager. The project manager works in
tandem with his or her manager to meet the
project objectives and ensure that the project
plan is in alignment with the overall program
plan.
A project manager should have the following
characteristics:
• Knowledge: Having good knowledge of
project management.
• Performance: Performing well in projects
by applying project management practices.
• Personal effectiveness: Including the
project manager's attitude, personality, and
leadership skills.