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Project Management: Achieving Competitive Advantage

Fifth Edition

Chapter 1

Introduction: Why Project Management?

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Learning Objectives (1 of 2)

1.1 Understand why project management is becoming such a powerful and popular practice in business.

1.2 Recognize the basic properties of projects, including their definition.

1.3 Understand why effective project management is such a challenge.

1.4 Understand and explain the project life cycle, its stages, and the activities that typically occur at each stage in the project.

Learning Objectives (2 of 2)

1.5 Understand the concept of project “success,” including various definitions of success, as well as the alternative models of success.

1.6 Understand the purpose of project management maturity models and the process of benchmarking in organizations.

1.7 Recognize how mastery of the discipline of project management enhances critical employability skills for university graduates.

P M B o K Core Concepts

Project Management Body of Knowledge (P M B o K) covered in this chapter includes:

Definition of a Project (P M B o K 1.2)

Definition of Project Management (P M B o K 1.3)

Relationship to Other Management Disciplines (P M B o K 1.4)

Project Phases and the Project Life Cycle (P M B o K 2.1)

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.

P M B o K 5th edition

General Project Characteristics (1 of 2)

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.

General Project Characteristics (2 of 2)

Traditional management functions of planning, organizing, motivation, directing, and controlling 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.

Process and Project Management

Table 1.1 Differences Between Process and Project Management

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

Project Success Rates

Software and hardware projects fail at a 65% rate.

Over half of all I T 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.

One out of six I T projects has an average cost overrun of 200% and a schedule overrun of 70%.

More than one-third of the $110 billion in costs spent on the post-war reconstruction projects in Afghanistan, total $110 billion was lost due to fraud, waste, and abuse.

Why Are Projects Important?

Shortened product life cycles

Narrow product launch windows

Increasingly complex and technical products

Emergence of global markets

An economic period marked by low inflation

Figure 1.4 Project Life Cycle Stages

Project Life Cycles

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.

Change During Project Life Cycle

Figure 1.5 Project Life Cycles and Their Effects

Quadruple Constraint of Project Success

Figure 1.7 The New Quadruple Constraint

Figure 1.8 Four Dimensions of Project Success Importance

Table 1.2 Understanding Success Criteria

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

Six Criteria for IT Project Success

System Quality

Information Quality

Use

User Satisfaction

Individual Impact

Organizational Impact

Project Management Maturity

Project management maturity (P M M) models are used to allow organizations to benchmark the best practices of successful project management firms.

Benchmarking is the practice of systematically managing the process improvements of project delivery by a single organization of a period of time.

Figure 1.9 Spider Web Diagram for Measuring Project Maturity

Figure 1.10 Spider Web Diagram with Embedded Organizational Evaluation

Figure 1.11 Project Management Maturity—A Generic Model

Developing Project Management Maturity

P M M models

Center for Business Practices

Kerzner’s Project Management Maturity Model

E S I International’s Project Framework

S E I’s Capability Maturity Model Integration

Center for Business Practices P M M

Level 1: Initial Phase

Level 2: Structure, Process, and Standards

Level 3: Institutionalized Project Management

Level 4: Managed

Level 5: Optimizing

Kerzner’s P M M Model

Level 1: Common Language

Level 2: Common Processes

Level 3: Singular Methodology

Level 4: Benchmarking

Level 5: Continuous Improvement

E S I International’s Project Framework

Level 1: Ad Hoc

Level 2: Consistent

Level 3: Integrated

Level 4: Comprehensive

Level 5: Optimizing

S E I’s Capability Maturity Model Integration

Level 1: Initial

Level 2: Managed

Level 3: Defined

Level 4: Quantitative Management

Level 5: Optimizing

Project Elements and Text Organization

Figure 1.12 Organization of Text

Project Management Employability Skills

Communication

Critical Thinking

Collaboration

Knowledge Application and Analysis

Business Ethics and Social Responsibility

Information Technology Application and Computing Skills

Data Literacy

Project Manager Responsibilities

Selecting a team

Developing project objectives and a plan for execution

Performing risk management activities

Cost estimating and budgeting

Scheduling

Managing resources

Figure 1.13 Overview of the Project Management Institute’s P M B o K Knowledge Areas

Summary (1 of 2)

Understand why project management is becoming such a powerful and popular practice in business.

Recognize the basic properties of projects, including their definition.

Understand why effective project management is such a challenge.

Understand and explain the project life cycle, its stages, and the activities that typically occur at each stage in the project.

Summary (2 of 2)

Understand the concept of project “success,” including various definitions of success, as well as the alternative models of success.

Understand the purpose of project management maturity models and the process of benchmarking in organizations.

Recognize how mastery of the discipline of project management enhances critical employability skills for university graduates.