Two Management Cases Study
BASIM1907
ProjectMgmtBasics.pdf
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Project Management: Back to Basics Publish Date: May 1, 2008
IT Projects are characterized by changing technologies,
uncertainty, and shifting business needs and objectives.
Review core project management basics and increase the
chances for ongoing IT project success.
© 1998-2008 Info-Tech Research Group
Technology Insight 2 Project Management: Back to Basics
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Executive Summary Projects and project management are not new to IT. For many organizations, projects in IT environments
have become a critical part of daily operations.
This note identifies and discusses the following topics surrounding project management:
» Definition of a project.
» Definition of project management.
» Project management constraints.
» The phases of project management.
» Why IT projects fail.
It is no surprise; project management has become increasingly challenging. As IT projects and project
management continue to play a large role in organizations, understanding and reviewing project
management basics and how they have evolved over time is critical for ongoing IT project success.
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Technology Point Traditionally, project management was used in construction and manufacturing environments. These
projects are typically characterized by disciplined planning and control methods, distinct and basic
project lifecycle phases, easily recognizable and predictable project processes, and well understood
tools and project activities. In today’s organizations, and particularly within IT environments, predictability
is anything but the norm. Managing IT projects is characterized by complex, interconnected systems,
projects that span the organization, constantly changing business needs, stakeholder demands, and
constrained resources. As a direct result, managing IT projects continues to be increasingly challenging.
What It Is & How It Works
Project Defined
According to the Project Management Institute's (PMI) Project
Management Body of Knowledge (PMBOK), “A project is a complex,
temporary endeavor undertaken to create a unique product or service.”
Unlike most IT processes, a project has a finite start and completion
date (i.e. lifecycle) and unique, or non-repetitive, deliverables.
Project Management Defined
Change in IT organizations today is inevitable. IT project management
is the means by which IT changes and developments are made in a controlled and focused manner.
Specifically, “IT Project management is a set of principles, practices and techniques applied to lead IT
project teams and control IT project schedule, cost, scope and quality of deliverables.” (Source: Project
Management: The Managerial Process, Clifford F. Gray and Erik W. Larson)
Project Management Institute
With more than 260,000
members in over 171
countries, PMI is the leading
membership association for
the project management
profession.
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Project management revolves around three key organizational elements (see Figure 2):
1. Business – projects must be aligned with and support the organization’s strategic goals and
objectives.
2. People – projects revolve around people. This includes the project manager, stakeholders, and
the project team.
3. Tools and Technology – projects rely on the resources at hand to plan, control, schedule, and
track project progress.
(Source: Adapted from “Understanding the Basics of Project Management”)
It is the role of the project manager to manage and optimize these three elements throughout the project
management process.
Project Management Constraints
A project, no matter the size or magnitude, must be completed under three constraints. Often referred to
as the “Triple Constraints of Project Management” or “The Project Management Triangle,” these
constraints are as follows:
» Scope – project size, goals and deliverables.
» Time – time frame available to complete the project.
» Cost (or Budget) – amount (in dollars) budgeted for the project.
As shown in Figure 1, each constraint represents a side of the triangle. Inside the triangle is the quality of
the project deliverable(s). While arguable as far as whether quality is an actual constraint of a project, it
is the direct result of the competing project priorities and is an important factor at the forefront of any IT
project.
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Figure 1. The Project Management Triangle
Source: Wikipedia
Quality of Project
Deliverables
SCOPE
TIME COST
Each project constraint is in direct competition or conflict with another. Therefore, changing one
constraint has a direct impact on the others. In almost all projects, the goal is a high quality deliverable
within a fixed time frame, at the predetermined cost. However, if for example, one constraint is
considered absolutely critical for the project, the other two constraints will have to give way, or be altered,
to accommodate the fixed constraint (see example situation below).
Situation
You have been tasked with making all internal IT systems compliant with a new SEC regulation.
The deadline is the end of this year. IT systems failing to meet new requirements will face strict
penalties. Assume it is January 1, 20XX and your CIO determines this project will take
approximately three months to complete.
Project Priorities
Your priorities would likely be in the following order:
1. Scope – all IT systems affected by the new regulation. (Fixed Constraint)
2. Time – you must get everything ready before midnight on December 31, 20XX (at the
very latest). (Variable Constraint)
3. Cost – you might have to spend whatever is necessary to make sure all requirements
and parameters are met and within the allotted time period.
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Explanation
» Scope is the fixed constraint since the situation (i.e. the project) applies to all IT
systems within the organization (i.e. all IT systems must be compliant with the
new SEC regulation, otherwise penalties will be imposed).
» Time is also a constraint as all IT systems must be in place before year end.
Since we assume it is January 1, the project can start at any time throughout the
year as long as it’s complete before year end; therefore, time is a variable
constraint.
Source: Info-Tech Research Group (adapted from “Understanding the Basics of Project Management”)
Phases of Project Management
Project management is accomplished in five phases (see Figure 2).
Figure 2. Phases of Project Management
Source: Info-Tech Research Group, adapted from “project management phases”
Project
Initiation
Project
Planning
Project
Execution
Project
Closure
Project Monitoring and Control
A brief description of each phase is below:
1. Project Initiation – The business problem or opportunity is identified and a business case is
developed. All stakeholders come together to establish preliminary agreement around project
scope, costs, and expected timelines.
2. Project Planning – Project plans are established outlining activities, resource requirements,
tasks, project deliverables, etc. A preliminary project schedule (i.e. work breakdown structure) is
drafted.
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3. Project Execution – This is where the bulk of the project
work is completed. During this phase, customer
requirements are gathered, a solution is agreed upon by all
stakeholders and/or selection/procurement begins. While the
actual project plan is being executed, a series of
management processes are also underway to monitor and
control project progress and deliverables and to ensure the
project stays on track.
4. Project Monitoring and Control – Regularly measuring and
monitoring project progress; making sure project objectives
are on track and being met. Variances from the project plan
are identified and corrective action is taken when necessary.
5. Project Closure – The project is delivered to the customer.
A post-implementation review is conducted to determine the
level of success of the project and to highlight key lessons
learned for future projects. For example:
» Did the project deliver on time, within budget, and to
scope and quality requirements?
» Were the customer, project stakeholders, and project team members satisfied with the project
deliverables?
» Did the project achieve the expected business benefits?
For Your Information
The Standish Group is a globally
respected source of independent
primary research and analysis of
IT project performance.
The CHAOS Chronicles (i.e.
compilation of various CHAOS
Reports) are the Standish
Group’s claim to fame and
comprise years of research done
through focus groups, in-depth
surveys, and executive
interviews on project
performance of over 50,000
completed IT projects.
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Key Considerations
Why Projects Fail
Business processes and IT projects are complex. According to The Standish Group’s 2006 CHAOS
Report, over 60% of all IT projects fail or run over time or budget (see Figure 3).
Figure 3. Project Performance
Source: The Standish Group, 2006 CHAOS Report
IT Projects in the US, 2006 CHAOS Report
Succeeded, 35%
Failed, 19%
Over Time or
Budget, 46%
Prior to embarking on new endeavors, IT leaders should be aware of the project’s chances for success.
Understanding how and why IT projects fail is one way to determine the outcome of a project. IT leaders
who know the common causes of project failure can learn from the mistakes of others and maximize their
chances for success.
IT projects are known to fail for some of the following reasons:
» Project sponsors are not committed to the project objectives.
» Business needs are not clearly defined (i.e. incomplete/changing requirements).
» Incomplete project scope and unrealistic expectations.
» Absence of a project plan.
65%
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» Lack of resources (i.e. people, technology, money, time frame).
» Inappropriate methodology or project approach.
» Too many people working on the project – no project synergy.
Key Takeaway 1. Refresh yourself on project management core concepts.
As IT continues to play an increasingly important role in
organizations, a keen understanding of IT projects and project
management is important. Characterized by uncertainty and
change, IT leaders should be aware of ways to increase their
chances for project success (see below):
» Manage project constraints. A successful project
manager must simultaneously manage the three basic
constraints of a project: scope, time, and cost, as well as
balancing the three constraints with the quality of the
project’s final deliverable. All constraints must be managed
together if the project, and the project manager, are to be
successful. Identify project drivers, constraints, and areas
with flexibility. Define each project dimension as a
constraint up-front, from within which the project must
operate, or define with a degree of freedom or flexibility that
can be adjusted within some stated bounds for the project
to succeed.
» Follow project management phases. Adhering to the
standard project management lifecycle phases ensures key tasks are completed in a logical and
controlled order. For example, this ensures that quality is checked and management approvals
are gained before the next piece of work is started. Following the standard phases of project
management helps to reduce the cost of rework and helps to position the project for success.
Did You Know?
IT project performance:
» $80-145 billion per year is
spent on failed and cancelled
projects.
» 25-40% of spending on IT
projects is wasted due to
rework.
» 40% of IT project problems are
found by end users.
» 60-80% of IT project failures
are attributed to poor
requirements gathering,
analysis, and IT project
management.
(Source: “The Blending of Traditional and Agile
Project Management,” PM World Today, May
2007)
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» Beware of why projects fail and take steps to mitigate common risks. Spend the time to
study and understand common project pitfalls. One of the best ways to plan for success is to
learn from the mistakes of others. Use standards and best practices such as the PMI`s PMBOK,
that, when executed properly, increase the chances for
project success. For more information, refer to the following
Info-Tech Advisor research notes:
- “Flawed Requirements Trigger 70% of Project Failures”
- “Requirements Models: The What, When, and Why”
- “Key Success Factors for IT Projects”
- “Get Requirements Right the First Time”
- “Projects: Managing Great Expectations”
Bottom Line IT Projects are characterized by changing technologies, uncertainty, and shifting business needs and
objectives. Review core project management basics and increase the chances for ongoing IT project
success.
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