Session 1 Overview of Project Management

Dr. Singh Devendra engds@nus.edu.sg

Text Book : Project Management in Practice by Mantel, Merdith, Shafer and Sutton 2011

TG1423 - Overview of Course

The analytical portion of the module is intended as an introduction for

engineering students to project management techniques.

It covers concepts of project organization using:

Work breakdown structure

Economic feasibility analysis

Planning and Scheduling using critical path and PERT methods

Finalizing schedules based on Resource Availability, and

Monitoring schedule and Budget variances.

Project management software is introduced with illustrative examples for students to try on their own.

Introduction
Much of project management developed by the military
Strategic defense initiative

Project management has found wide acceptance in industry It has many applications outside of construction
Managing legal cases Managing new product releases Managing cities (SMART cities)

http://www.youtube.com/watch?v=6axgrZUrqH8

Main forces in driving the acceptance of project and other forms of management:

Different Factors Affecting Outcome

Many factors affect the outcome of a project
Some are one-time factors
The cost of an item

Others are reoccurring

Maintenance

1. The exponential growth of human knowledge 2. The growing demand for a broad range of complex goods and services 3. Increased worldwide competition 4. Increased complex technological world and network externalities Emergence of Complex problems

(http:// www.youtube.com/watch?v=GE5lviCN7gA )

All of these contribute to the need for organizations to do more and to do it faster

Not all factors are equally important Critical factors on one project may be trivial on another project

Project management is one way to do more faster

The Nature of Project Selection Models

Projects tend to be large

Projects Tend to be Large

The Channel Tunnel, or Chunnel Denver International Airport Panama Canal expansion project Three Gorges Dam, China

Models turn inputs into outputs Managers decide on the values for the inputs and evaluate the outputs The inputs never fully describe the situation The outputs never fully describe the expected results Models are tools Managers are the decision makers

Projects are getting larger over time

Flying: balloons planes reusable rockets jets rockets

The more we can do, the more we try to do

Project Management Also Getting Smaller

Easy to Implement
This is less of an issue with modern spreadsheets However, a model to be used to evaluate all maintained

1. More people are seeing the advantages of project management techniques

2. The tools are become cheaper

3. The techniques are becoming more widely taught and written about

Inexpensive

Main Goals of Project Management

Optimizing the effectiveness Balancing Time, cost, and performance

Do not want the model to eat up all the savings that result from using the model Expenses include the cost of writing and maintaining the model Also includes the expense of gathering the data needed by the model
Direct Project Goals: Performance, Cost, Time

Trends in Project Management

Easy to Use
Needs to be quick to gather the data and easy to use model

Achieving strategic goals Achieving routine goals Improving project effectiveness Virtual projects Quasi -projects

Flexibility
Importance Performance Life cycle with a finite due date Interdependencies Uniqueness Resources Conflict

Major Characteristics of a Project

Needs to be able to work with all projects Needs to be updated as the firm and its environment evolves

Why Project Management?

Capability
Model needs to be sophisticated enough to deal with all projects
Varying resource requirements Varying time periods Varying probabilities of success

The main purpose for initiating a project is to accomplish some goal Project management increases the likelihood of accomplishing that goal Project management gives us someone (the project manager) to spearhead the project and to hold accountable for its completion

Needs to be able to select the optimum projects among all contenders

Realism

Negative Side to Project Management Greater organizational complexity Higher probability organizational policy will be violated Says managers cannot accomplish the desired outcome Conflict

Needs to include all objectives of the firm Needs to include the firms expertise as well as its limitations Needs to report results in a fashion that allows different projects to be compared, e.g. how do we compare a project to lower production cost and one to raise market share

The Project Life Cycle

Realism Capability Flexibility Easy to use Inexpensive Easy to implement

Model Criteria

Figure 1-3

Criteria

(Continued)

Time Distribution of Project Effort

Companies need a way of weeding out the bad projects while keeping the good ones No model can predict with absolute certainty No model could predict

The Exxon Valdez wreck The explosion of the Challenger

Figure 1-4

Another Possible Project Life Cycle

Criteria For Project Selection Models

Companies only want to undertake successful projects Projects that fail waste resources and hurt profitability and competitiveness Projects that succeed improve profitability and competitiveness It is not possible to know ahead of time if a project will succeed or fail In fact, there is a continuum of possible results from total success through absolute failure

Figure 1-5

Types of Models

Risk During at the Start of the Life Cycle

Stochastic Model

A model that includes the probabilities of events occurring within the model. In other words, the same inputs might yield different outputs at different runs. Also known as a probabilistic model.

Deterministic Model

A model that does not include probabilities. Given the same inputs, the outputs will always be the same.

Figure 1-6

Risk During the Life Cycle

Models
Models are used to select projects All models simplify reality That is, they only look at the key variables involved in a decision The more variables included in a model, the more complex it becomes Simpler models usually work better

Figure 1-7