Project

A complex, non-routine, one-time effort limited by time, budget, resources, and performance
specifications designed to meet customer needs.
Has an established objective
Defined life span, with beginning and end
Typically requires cross organizational participation
Can involve doing something never done before
Has specific time, cost, and performance requirements
Program
Series of coordinated, related, multiple projects that continue over time
Higher level group of projects targeted at a common goal
Project Management
Balance technical (quality), schedule, cost
Customer, management, team expectations
Identify project requirements and customer expectations
Projects v Routine operations
Unique v repetitive
Limited life v continuous
Multiple stakeholder v departments
Management
Perceived risk
Project size
Project complexity
These three determine the amount of detail of planning, when planning effort occurs,
functionality requirements, amount of reporting
Project Life Cycle- divided into different phases to better management control, slow start, buildup speed,
and slowdown near completion
Defining
Planning
Executing
Closure
A project manager must
Manage temporary, non-repetitive activities and frequent acts independently of the formal org.
Appropriate resources
Provide direction, coordination and integration to project team
Manage stakeholders
Ask others for technical answers
Responsible for performance and success of project
Organizational strategy
Global competition
Shortened product life cycles
Industry consolidation
Accountability

Strategic management
Responding to changes
Allocate resources
Link mission, goals, objectives, strategy, and implementation
SMART
Specific-state action needed
Measurable-measure quality and quantity
Assignable-divide up tasks to people
Realistic-objectives challenging but not too much
Time- set deadlines
Project portfolio system
Select different projects for implementation
Matches strategic goals of company
Compliance (must do)
Operational Projects
Strategic projects
Project Selection
Financial
Payback model-emphasizes cash flow
Ignores time value of money
=project costs/annual savings
Net Present Value (NPV)
Uses desired rate of return to compute inflows and return of cash
+= approve, - = reject
Non-financial
Capture larger market share
Stop competitors
Make better project
Develop technology
Reduce dependency on unreliable suppliers
Comply with government intervention and regulation
Weighted
Project Proposal
Request for proposal (RFP)
Statement of work (SOW) detailing scope and major deliverables
Cost
Type of contract
Organizational Planning
Purpose-identify, document, and assign roles and responsibilities
Balance need of project with needs of organization
Project Organization Structures
Functional
One clear supervisor
Used when interest of one functional area dominates the project
Different groups: marketing, engineering, manufacturing, procurement

Dedicated Teams
Full time project manager
Teams operate as separate units
Separate teams drawn out
Matrix Structure
Two chains of command, functional and project
Optimizes the use of resources
Draws people from everywhere
Organizational culture
A system of shared norms, beliefs, values and assumptions which bind people together, creating
shared meanings
Job v Organization
Loose v Tight Control
Internal v External
Low risk v High risk
Define Project
Scope and Requirements
Scope-definition of end result or mission of project
Give deliverables for customers
Milestones, requirement, limits, and reviews with customer
Planning tool
Scope Statement- Statement of Work (SOW)
Project Charter- Authorizes the project manger
Scope Creep
Changes to the scope over time
Know: Contract, Schedule, Cost, and Technical
Requirements- Complete, Consistent, Correct, Unambiguous, Measureable, traceable,
design-free, necessary
Project Priorities
Project Trade-offs
Shifts in relative importance of criteria related to cost, time, and performance
Constrain-Fixed requirement
Enhance- optimizing a parameter over others
Accept-reducing or not meeting a parameter
Scope v Cost v Time=Quality
Work Breakdown Structure
Deliverable oriented hierarchical decomposition of work to be executed by the project
team to accomplish the project objectives and create the required deliverables,
defines the total scope of the project
Decomposes work into manageable tasks to be defined, scheduled, budgeted
Helps evaluate cost, time, and technical performance
Helps the development of the organization breakdown structure (OBS)
Hierarchy
Project
Deliverable
Sub deliverable
Lowest sub deliverable
Cost account
Work Package

How low?
All activities do not usually end up at the same level throughout WBS
OBS- Defines organizational unit responsible for performing the work
Integrate WBS with OBS
Responsibility Assignment Matrix (RAM)
A structure that relates the project OBS to the WBS to ensure that each
component of the projects scope of the work that assigned to the person
or team
Defines a single person with authority and accountability
Intersection points are control accounts
Focal point for data collection and comparisons of work performed
against the plan
Create the Project control point (control account) that integrates work and responsibility
Large projects, projects with distributed teams
Stakeholder Communications
Low Power to High Power v Low interest to high interest
Project Communication Plan
Maps out the flow of information on the project
What info needs to be collected?
Who, and what methods with be used
When?
How?
Stakeholder analysis => Info Needs => Sources of info => Dissemination modes =>
Responsibility and timing
Estimating Projects
The process of forecasting or approximating the time and cost of completing project deliverables
Balancing the expectations of stakeholders and the need for control
Top-Down
Group consensus or mathematical relationships
Strategic decision making
High Uncertainty
Internal, small project
Unstable scope
Bottom up
Uses WBS, document of estimate in a Basis of Estimate (BOE)
Time consuming and costly
Justify costs
Fixed price contract
Customer wants details
Cost and time important
Use both top and bottom to validate estimates
Guidelines
Have people familiar with tasks make the estimate
Have several people to make estimates
Base estimates on normal conditions, efficient methods and a normal level of resources
Use consistent time units
Treat each task as independent
Do not make allowances for contingencies
Add risk assessment

Template Estimate (Comparative)

Estimate is developed based on similar elements from other relevant experience
Compares different elements
Fairly credible, based on history
Parametric Estimate
Models that mathematically analyze a large amount of experience and reduce it to equations
Very credible, but little judgment applied
Detailed Estimate
Estimate developed at the work package level by people responsible for the effort
Least credible, not based in history or standards, credibility based on estimator
Range Estimating
Used when there is significant uncertainty associated with the time or cost to complete
Cost between x and x, and take y and y months
Costs
Direct Costs
Clearly chargeable to a specific work package
Direct Project Overhead Costs
Costs incurred that are directly tied to an identifiable project (ie rental space)
Ratio of dollar value of resources used (labor)
General and administrative overhead costs
Organization costs not directly linked to a specific project that are apportioned to the
project and shared by other projects
Refining Estimates
Interaction costs are hidden in estimates
Normal conditions do not apply
Things went wrong
Changes in scope, scope creep
Adjusting risks
Experience to date shows estimate no longer valid
The Project Network
A visual flow diagram of the sequence, inter relationship, and dependencies of all the activites
that must be accomplished to complete the project
Provides a basis for assigning work
Provides the basis for scheduling labor
Enhances communication
Provides a basis for budgeting cash
Highlights critical paths
Activites in the Project Network
Where?
Lowest Level Work packages defined in the WBS
An element of the project that requires time
Merge activity-activity that has two or more preceding activities
Parallel activity- activities that can occur independently and at the same time
Path-Sequence of connected, dependent activites

Critical path-longest path through completion, shortest time of project completion]

Event- Significant point in a project, milestone, does not consume time
Burst Activity- an activity that has more than one activity flowing from it
Develop Project Networks
Flows left to right
Activity cannot begin until all preceding activities are complete
Arrows indicate precedence and flow and can cross over each other
Use common start and stop nodes
Forward Pass
Early start/early finish (ES/EF)
Backward pass
Late Start/Late Finish (LS/LF)
Slack
Difference between time available and time needed
LS-ES or LF-EF
SL=Start Lag
Cannot have unless loop
No conditional statements
Laddering
Activites are broken into smaller segments so the following activity can begin sooner and not
delay the work
Lags
Minimum amount of time a dependent activity must be delayed to begin or end
Gantt Chart
Provides a graphical depiction of schedule data
Displays original plan (baseline) and progress against the plan
Summarized by WBS
Outsourcing
Contracting for the use of external sources to assist in implementing a project
Transferring business functions or processes to other companies
Cost reduction
Faster Completion
Contract
Mutually binding relationship enforceable by the law
Statement of work (SOW)
Technical specifications
Terms and Conditions
Fixed Price Contracts- seller carries the risk, most profit potential, deliver service for price
Cost Reimbursable- Buyer carries risk, lower project (Research), best effort
Time and Materials- Ceiling price is identified and profit is built into labor, deliver hours at a specified
hourly rate and materials for a cost