Fundamentals of Project Management

MS(PM) MSP 603 Semester: 1 Fall 2019

Lecture # 2

FACULTY OF MANAGEMENT SCIENCES - BUKC

 Learning Outcomes
By the end of today’s lecture, you will understand
Modern project management:
• What is a project?
• Relationships among portfolio management, programme
management, project management and organizational project
management.
• Relationship between project management, operations
management and organizational strategy
• The Project Manager
 What is a project? Some Definitions
• A unique set of coordinated activities, with definite
starting and finishing points, undertaken by an individual
or organization to meet specific performance objectives
within defined schedule, cost and performance
parameters
• (BS 6079: 2000).

• Projects are unique, transient endeavors undertaken to

achieve a desired outcome.
[Association for Project Management (UK’s largest professional body for project
managers)]
 What is a project? Some Definitions
• Project is a temporary endeavor undertaken to create a
unique product, service or result.
[Project Management Institute (world’s largest professional association)]

• Project refers to a value creation undertaking based on a

specific mission, which is completed in a given or agreed
timeframe and under constraints, including resources
and external circumstances.
[Project Management Association of Japan]
 Foundational Concepts - Project
• A Project is a temporary endeavor undertaken to create a unique
product, service or result.
• Temporary (finite) group of related tasks undertaken to create a
unique product, service, or result
• Time-limited (definite beginning and end)
• Unique (it has not been attempted before by this org)
• Initiated when a group or individual recognizes a problem or
opportunity and decides to take action
• It has interrelated activities
• Undertaken for a purpose (it will yield specific product, service, or
result), at all organizational levels, involve a single person, group,
single/multiple units of a single or multiple organizations.
 Foundational Concepts
• Projects are undertaken to fulfil objectives by producing
deliverables
• Objective? Outcome towards which work to be directed,
a strategic position to be attained, a purpose to be
achieved, a result to be obtained, a product produced or
service performed
• Objectives must define desired benefits, outcomes or
performance improvements that you expect from the
project. ...
 Foundational Concepts
• Deliverable? Unique/verifiable product, result or capability to
perform a service required to complete a phase/project. Can be
tangible or intangible
• Deliverables are only produced in order to enable achievement
of the objectives. Deliverables are not “outcomes”.
• Projects are temporary, but deliverables exist beyond; a national
monument, which will create a deliverable to last for centuries
• A project is successful when it meets or exceeds the
expectations of stakeholders.
 Foundational Concepts
• End of the Project:
• Project’s objectives achieved
• Objectives will not or cannot be met
• Funding is exhausted/no longer available
• Need no longer exists (Customer’s decision, change in strategy or
priority, Management directs to end the Project)
• Human/physical resources no longer available
• Terminated for legal cause or convenience
 Foundational Concepts
• Successful projects are those whose business case is
aligned with organizational strategy
• Business case captures the reasoning for initiating a
project ... can range from comprehensive and highly
structured, to informal and brief.
• Good to review documentation of similar projects,
better clarity.
• Identify best practices by interviewing domain experts
and experienced in similar project.
 Foundational Concepts
• Philosophy:
• Projects not disconnected from the organizations that carry
them out. Every project has a context and heavily influenced by
the type of org
• An effective PM must identify the different types of project
stakeholders (customers, project sponsor, senior management,
etc) understand their needs, and help them all work together to
create a common and realistic goals that will lead to a successful
project
Project Stakeholders

• Individuals and organizations that are actively

involved in the project, or whose interests may be
positively or negatively affected as a result of project
execution or completion

• Differences among, or between, stakeholders should

be resolved in favor of the customer

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But who are Stakeholders

The following may be stakeholders:

• Sponsor  Project team members

 Suppliers
• Performing organization  Contractors.
• Chief Executive  Consultants
 Society/Citizen
• Board of Directors  Neighbors.
• Project Director  Competitors
 End user
• Relevant Government Agencies.  PMO
• Lending Institution.  And so on
• Customer-the individual or
organization that will use the
product of the project

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 Organization State Transition via Project
• Projects drive change in organizations, aimed at moving from
one (present) state to future state to achieve a specific objective.
• Projects enable business value creation. The benefits can be
tangible or intangible.
 Project Initiation Context
• Initiated in response to factors to keep organizations viable, link
strategic objectives to business value of each project
Project Initiation Context
 Volume and variety
• Generally an inverse relationship between volume and variety.
• Traditional project management area is low-volume, high-variety
processes, with the notion of uniqueness.
• Indicated as First- Timers Projects.
• Examples are:
• The first moon landing
• Development of the first computer.
Volume and variety
Volume Variety Graph
 Volume and variety
• Projects often run for as short as a few weeks, and carried out
on a regular basis as part of ordinary business activity.
• As… But…’s Projects
• If there is some similarity to previous work of any project, in
terms of either the process followed or the product being
delivered; referred as ‘as . . . but . . . ’s Projects. That is, ‘as the
job we did last time, but with the following differences’.
• For example:
• Final year projects
• Construction of a house
 Volume and variety
• End product may be different, but the process is often repeated
over time.
• Painting by Numbers Projects
• High degree of commonality with a previous project in both
process and outcome; termed Painting by Numbers projects, as
the process and the outcome are well known.
• For example
• Yearly financial audits
• Turnaround maintenance
So What Really is Project Management ??
 PROJECT MANAGEMENT
• Project Management is the application of knowledge,
skills, tools, and techniques to project activities to meet
the project requirements.
• PM is accomplished through the appropriate application
and integration of the project management processes
identified for the project.
• PM enables organizations to execute projects effectively
and efficiently. It is no longer about managing the
sequence of steps required to complete the project on
time.
 PROJECT MANAGEMENT
• It is about systematically incorporating the voice of the
customer, creating a disciplined way of prioritizing effort
and resolving trade-offs, working concurrently on all
aspects of the project in multi-functional teams, and
much more.
• It involves much closer links between project teams and
downstream activities, e.g. in new product
development, integration with manufacturing, logistics
and after-sales support.
 IMPORTANCE OF PROJECT
MANAGEMENT
• Effective project management helps individuals, groups,
and organizations to:
• Meet business objectives;
• Satisfy stakeholder expectations;
• Be more predictable;
• Increase chances of success;
• Deliver the right products at the right time;
• Resolve problems and issues;
 IMPORTANCE OF PROJECT
MANAGEMENT
• Respond to risks in a timely manner;
• Optimize the use of organizational resources;
• Identify, recover, or terminate failing projects;
• Manage constraints (e.g., scope, quality, schedule, costs,
resources);
• Balance the influence of constraints (increased scope may
increase cost or schedule); and
• Manage change in a better manner.
 IMPORTANCE OF PROJECT
MANAGEMENT
• Poorly managed projects or the absence of project management may
result in:
• Missed deadlines,
• Cost overruns,
• Poor quality,
• Rework,
• Uncontrolled expansion of the project,
• Loss of reputation for the organization,
• Unsatisfied stakeholders, and
• Failure in achieving the objectives for which the project was
undertaken.
 IMPORTANCE OF PROJECT
MANAGEMENT
• Projects are a key way to create value and benefits in
organizations.
• Organizational leaders need to manage with tighter
budgets, shorter timelines, and rapidly changing
technology.
• Business environment is dynamic with an accelerating
rate of change. To remain competitive companies are
embracing project management to consistently deliver
business value.
 IMPORTANCE OF PROJECT
MANAGEMENT
• Effective and efficient project management should be
considered a strategic competency within organizations.
It enables organizations to:
• Tie project results to business goals,
• Compete more effectively in their markets,
• Sustain the organization, and
• Respond to the impact of business environment changes
on projects by appropriately adjusting project
management plans.
 FOUNDATIONAL ELEMENTS

RELATIONSHIP OF PROJECT, PROGRAM,

PORTFOLIO, AND OPERATIONS
MANAGEMENT
 PROJECT, PROGRAM, PORTFOLIO, AND
OPERATIONS MANAGEMENT
• A project may be managed in three separate scenarios:
• Stand-alone project, Within a program, Within a portfolio.
• Program: Group of related projects, and subsidiary programs,
managed in a coordinated manner to accomplish a set of goals,
and obtain benefits not available from managing them
individually.
• Programs are not large projects. A very large project may be
referred to as a megaproject.
The Hong Kong, Zhuhai, Macau Bridge
Mega-Project April 14, 2017
 PROJECT, PROGRAM, PORTFOLIO, AND
OPERATIONS MANAGEMENT
• Portfolio: Projects, programs, subsidiary portfolios, and
operations managed as a group to achieve strategic objectives.
• Program and portfolio management differ from project
management in their life cycles, activities, objectives, focus, and
benefits.
• Portfolios, programs, projects, and operations often engage with
the same stakeholders and may use the same resources which
may result in a conflict in the organization.
 PROJECT, PROGRAM, PORTFOLIO, AND
OPERATIONS MANAGEMENT
• This situation increases the need for coordination through the
use of portfolio, program, and project management to achieve a
workable balance in the organization.
• Project managers interact with portfolio and program managers
when a project is within a program or portfolio.
Sample portfolio structure for effective management
 PROJECT, PROGRAM, PORTFOLIO, AND
OPERATIONS MANAGEMENT
• Organizational and portfolio planning impact
prioritization based on risk, funding, and
other considerations.
• The portfolio view allows organizations to
see how the strategic goals are reflected in
the portfolio.
• Enables the implementation of appropriate
portfolio, program, and project governance.
 PROJECT, PROGRAM, PORTFOLIO, AND
OPERATIONS MANAGEMENT
• Coordinated governance allows authorized
allocation of human, financial, and physical
resources based on expected performance
and benefits.
• Program and project management focus on
doing them the “right” way
• Portfolio management focuses on doing the
“right” programs and projects.
 PROGRAM MANAGEMENT
• Program management: Application of knowledge, skills, and
principles to a program to achieve the program objectives and
control not available by managing program components
individually.
• Project management focuses on interdependencies within a
project.
• Program management focuses on the interdependencies
between projects and between projects and the program level to
determine the optimal approach for managing them by:
• Aligning with the organizational or strategic direction;
• Allocating the program scope into program components;
 PROGRAM MANAGEMENT
• Managing program risks that may impact multiple projects in the
program;
• Resolving constraints and conflicts that affect multiple projects
within the program;
• Resolving issues between component projects and the program
level;
• Allocating budgets across multiple projects within the program;
and
• An example of a program is a new communications satellite
system with projects for the design and construction of the
satellite and the ground stations, the launch of the satellite, and
the integration of the system.
 PORTFOLIO MANAGEMENT
• Portfolio management: Centralized management
of one or more portfolios (Projects, programs,
subsidiary portfolios, and operations) to achieve
strategic objectives.
• The programs or projects of the portfolio may not
be interdependent or directly related.
• The aim of portfolio management is to:
• Guide organizational investment decisions.
 PORTFOLIO MANAGEMENT
• Select the optimal mix of programs and
projects to meet strategic objectives.
• Provide decision-making transparency.
• Prioritize team and physical resource
allocation.
• Increase the likelihood of realizing the
desired return on investment.
 PORTFOLIO MANAGEMENT
• Centralize the management of the aggregate risk
profile of all components.
• Components are prioritized so that those
contributing the most have the required financial,
team, and physical resources.
• Infrastructure organization that has the strategic
objective of maximizing the return on its
investments may put together projects in oil and
gas, power, water, roads, rail, and airports.
 PORTFOLIO MANAGEMENT
• All of the power projects may be grouped
together as a power portfolio, and water projects
as a water portfolio.
• When the organization has projects of power
plants, they can be grouped in one program.
• Thus, the power program and similar water
program become integral components of the
portfolio of the infrastructure organization.
 OPERATIONS MANAGEMENT
• It is outside the scope of formal project management
• Concerned with the ongoing production of goods and/or
services.
• Ensures that business operations continue efficiently by
using the optimal resources needed to meet customer
demands.
• It is concerned with managing processes that transform
inputs (e.g., materials, components, energy, and labor)
into outputs (e.g., products, goods, and/or services).
 OPERATIONS AND PROJECT
MANAGEMENT
• Changes in business or organizational operations may be the
focus of a project—especially when there are substantial
changes to business operations as a result of a new product or
service delivery.
• Ongoing operations are outside of the scope of a project;
however, there are intersecting points where the two areas
cross.
• Projects can intersect with operations at various points during
the product life cycle:
• When developing a new product, upgrading a product, or
expanding outputs;
 OPERATIONS AND PROJECT
MANAGEMENT
• While improving operations or the product development
process;
• At the end of the product life cycle; and
• At each closeout phase.
• At each point, deliverables and knowledge are transferred
between the project and operations for implementation of the
delivered work.
• This implementation occurs through a transfer of project
resources or knowledge to operations or through a transfer of
operational resources to the project.
 OPM AND STRATEGIES

• Portfolios, programs, and projects are aligned with or driven by

organizational strategies and differ in the way each contributes
to the achievement of strategic goals:
• Portfolio management aligns portfolios with organizational
strategies by selecting the right programs or projects, prioritizing
the work, and providing the needed resources.
• Program management harmonizes its program components and
controls interdependencies in order to realize specified benefits.
• Project management enables the achievement of organizational
goals and objectives
 OPM
• Within portfolios /programs, projects achieve organizational
goals and objectives.
• Accomplished in the context of a strategic plan, the primary
factor guiding investments in projects.
• Alignment with the organization’s strategic business goals can be
achieved through the application of OPM.
• OPM is defined as a framework in which portfolio, program, and
project management are integrated with organizational enablers
in order to achieve strategic objectives.
 OPM
• The purpose of OPM is to ensure that the organization
undertakes the right projects and allocates critical resources
appropriately.
• OPM also helps to ensure that all levels in the organization
understand the strategic vision, the initiatives that support the
vision, the objectives, and the deliverables.
• Shows the organizational environment where strategy, portfolio,
programs, projects, and operations interact.
OPM
 DEFINITION OF A PROJECT MANAGER
• The role of a project manager is distinct from that of a
functional manager or operations manager.
• Typically, the functional manager focuses on providing
management oversight for a functional or business unit.
Operations managers are responsible for ensuring that
business operations are efficient.
• The project manager is the person assigned by the
performing organization to lead the team that is
responsible for achieving the project objectives.
 ROLE OF THE PROJECT MANAGER
• The project manager plays a critical role in the
leadership of a project team
• This role is clearly visible throughout the project.
• The role of a project manager may vary from
organization to organization.
• Many project managers are involved in a project from
initiation through closing.
• In some organizations, a project manager may be
involved in evaluation and analysis prior to project
initiation.
Project Manager

• Proactive
• In control of the project & has the authority to say no when necessary.
• Held accountable for project failure
• Understands professional responsibility
• In charge of the project but not necessarily the resources, formally
empowered to use organizational resources, authorized to spend
project’s budget
• Do not necessarily be a technical expert
• Authorized to make decision for the project.

The project manager’s level of authority can vary depending on the form of
organization.

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 ROLE OF THE PROJECT MANAGER
• Project manager may also be called upon to assist
in business analysis, business case development,
and aspects of portfolio management for a
project.
• Project manager may also be involved in follow-on
activities related to realizing business benefits
from the project.
• Ultimately, the project management role is
tailored to fit the organization in the same way
that the project management processes are
tailored to fit the project.
 ROLE OF THE PROJECT MANAGER
• Membership and roles. A large project and an
orchestra each comprise many members, each
playing a different role.
• A large orchestra may have more than 100
musicians, led by a conductor.
• Musicians may play 25 different kinds of
instruments.
• Similarly, a large project may have more than 100
members, led by a project manager.
 ROLE OF THE PROJECT MANAGER
• Team members may fulfill many different
roles, such as design, manufacturing, and
facilities management.
• Like the orchestra, they represent multiple
business units or groups within an
organization.
• The musicians and the project members
make up each leader’s team.
 Contents for Lecture #3 - Sept 22
• Organizational influences and project lifecycle: (PMBoK)
• Organizational influences on project management
• Project stakeholders and governance
• Project lifecycle
• The Project Manager
• Drivers of project management