Bule Hora University

Course Name:-Information Technology Project Management

Course Code:-InTe2103

INDIVIDUAL ASSIGMENT

Set By: - Mulatu Gemechu ID NO: - 054

Submitted to:-

Submission Date:-

1. Elaborate what is project and project management (6%)?

What Is Project? A project is a unique, transient endeavor, undertaken to achieve planned objectives,
which could be defined in terms of outputs, outcomes or benefits. A project is usually deemed to be a
 success if it achieves the objectives according to their acceptance criteria, within an agreed timescale and
budget.
Definition of Project Management: A project is temporary in that it has a defined beginning and end in
time, and therefore defined scope and resources. And a project is unique in that it is not a routine
operation, but a specific set of operations designed to accomplish a singular goal. Project management is
the application of knowledge, skills, tools, and techniques to project activities to meet the project
requirements.
The planning and organization of an organization's resources in order to move a specific task, event or
duty toward completion.
Project management typically involves a one-time project rather than an ongoing activity, and resources
managed include both human and financial capital.

Project management is often closely associated with engineering projects, which typically have a complex
set of components that have to be completed and assembled in a set fashion in order to create a
functioning product.
Project managers use visual representations of work flow such as Gantt charts and PERT charts to
determine which tasks are to be completed by which departments.

2. Write at least four project Integration Management Processes and discuss them (4%)
Project integration management involves coordinating all of the other project management knowledge
areas throughout a project’s life cycle. This integration ensures that all the elements of a project come
together at the right times to complete a project successfully. Six main processes are involved in project
integration management:
 1. Developing the project charter involves working with stakeholders to create the document that
formally authorizes a project—the charter.
2. Developing the project management plan involves coordinating all planning efforts to create a
consistent, coherent document—the project management plan.
3. Directing and managing project work involves carrying out the project management plan by
performing the activities included in it. The outputs of this process are deliverables, work performance
information, change requests, project management plan updates, and project documents updates.
4. Monitoring and controlling project work involves overseeing activities to meet the performance
objectives of the project. The outputs of this process are change requests, project management plan
updates, and project documents updates.
5. Performing integrated change control involves identifying, evaluating, and managing changes
throughout the project life cycle. The outputs of this process include change request status updates,
project management plan updates, and project documents updates.
6. Closing the project or phase involves finalizing all activities to formally close the project or phase.
Outputs of this process include final product, service, or result transition and organizational process
assets updates.
3. Write at least four methods for selecting Projects and discuss them briefly (6%)
There is usually enough time or resource to implement all projects. Thus projects need to be select based
on the following methods:
 Focusing on the broad organizational needs.
 Categorizing information technology projects.
 Performing net present value or other financial analyses.
 Using weighted scoring model.
 Implementing a balanced scorecard.

Focusing on the broad organizational needs.

 It is often difficult to provide strong justification for many IT Projects, but everyone agrees they have a
high value. Three important criteria for projects are:-
 There is need for the project.
 There are funds available for the projects.
 There is a strong will to make project succeed.
Categorizing information technology projects.
 Projects may be categorized based on different criteria
 One categorization assesses whether the project provides a response to:
A problem an opportunity, or a directive
 Another categorization is the overall priority of the project.
Performing net present value or other financial analyses.
Net Present Value (NPV)

 NPV, also known as Net Present worth (NPW), is most prevalent in capital budgeting, where analysts use it
to identify the projects with the highest value proposition for the business.

 The Net Present Value is the method we use to get today’s value of a projected future cash flow stream.

 The measure is useful when comparing investment alternatives of similar nature.

 It relies on a discount rate, which represents the cost of capital to finance the endeavor.
 The main disadvantages of the NPV calculation lie with the fact that it makes assumptions for future events
that may not occur.
Calculating the NPV
We determine the Net Present Value of a series of cash flows by calculating the costs (negative cash flows) and
benefits (positive cash flows). We achieve this via the following formula:

Where:

CFt is the cash flow in the period;

n is the number of periods;
t is the current period;
i is the discount rate.

 And whenever we have a constant cash flow each year, the formula can be represented as a standard finite
geometric series:
Where:
CF is the continuous cash flow each period;
n is the number of periods;
i is the discount rate.
Net Present Value Analysis

 The NPV analysis is a form of intrinsic valuation.

 We use it extensively across financial analysis and accounting to determine the value of a business,
investment opportunities, capital projects, new ventures, and cost reduction plans.
Using weighted scoring model.
Weighted Scoring Model Definition
“The weighted scoring model or the decision matrix can help them prioritize tasks using a weighted score. This
weighted score value is then assigned to each task and compared with cost and benefit analysis.”

 Weighted Scoring is a model used to prioritize the actions, tasks, decisions, features, and other initiatives
by assigning a numerical value based on the cost advantage or the effort value of the particular activity. 
 It is a method used by product managers to draw the layout for the product roadmap by giving numbers or
points of priority to essential and urgent activities. 
 Through this method, you can determine all elements of the product roadmap based on their importance
and priority. 
 Business decision-making is a challenging and crucial task involving big teams, data sets, user stories,
complex features and budgets, and the large impact of any action or decision. 
 Therefore to make it rational and easy for the executives, a model of numerical scoring against return
benefits is devised.
To create a weighted scoring model, the following steps are applied:
 Identify the criteria important to the decision process
 Assign a weight to each criterion based on its relative importance in the decision (ideally, so they all add
up to 100%)
 Assign numerical scores to each criterion for all of the options being considered.
  Calculate the weighted scores by multiplying the weight for each criterion by its score and adding the
resulting values.
Following are the three weighted scoring model criteria.

For example, if you want to find a vendor from the three options available to you. In making this decision, you
will look at the three criteria:

Price (40%)
Reputation with the vendors based on the previous performance (30%)
You wish to work with vendors who will work with you on sustainability factors as well (30%)
Now you will base your decision on these criteria. And put a score in front of them to help you with the decision. 
Implementing a balanced scorecard.
What is a Balanced Scorecard
 The Balanced Scorecard is the process of organizations creating a set of internal metrics that will help
them to assess their business performance in 4 key areas.
These 4 areas are financial, customer, internal business process & learning and growing.
Financial 
 Typical scorecard metrics might include cash flow, sales performance, operating income or return on equity.

Customer 
 With scorecard metrics such as: % of sales from new products, on-time delivery, net promoter score or share
of wallet.
Internal Business Process 
 This would include measuring things such as: unit costs, cycle times, yield, error rates, etc.

Learning and Growth 

 Examples of metrics being: employee engagement scores, retention rates of high performing staff, skill
increases of staff, etc.
How to Implement the Balanced Scorecard
 Before we dive into the detail of how to implement the Balanced Scorecard for your own organization, we
need to take a look at what people so often get wrong.
Balanced Scorecard Implementation Mistakes
A lot of people look at the Balanced Scorecard as 4 simple perspectives that you simply 'slot your goals' into.
When they visualize the Balanced Scorecard, they think of it like this diagram:
4 simple perspectives that link together to give you a Balanced Scorecard of your business performance.
Each perspective containing a list of Strategic Objectives, Projects and KPIs which you then go away and
work on.
The end goal being to try and balance each perspective and result in improved performance.
This approach to implementing the Balanced Scorecard is however fundamentally wrong.
The Balanced Scorecard is not a series of equally weighted perspectives.
It is rather a process whereby, starting at the bottom, you work your way upwards through each
perspective with a view to delivering the topmost - Financial Gain.
Each perspective unlocks your ability to deliver effectively against the one above it.
So instead of the diagram above, you need to visualize the Balanced Scorecard from a strategy
mapping point of view:
 If you follow the steps in the diagram, you'll see that the ultimate end of the journey is to increase
profitability (Financial).
 Learning and Growth / Internal Processes / Customer - these are your leading steps, as they will facilitate the
delivery of your one and primary lagging step, which is your financial performance.
4. Write two of risk identification tools and techniques (4%)
1. Documentation review
The standard practice to identify risk is reviewing project related documents such as lessons learned, articles,
organizational process assets, etc.
2. Information gathering techniques
The given techniques are similar to the techniques used to collect requirements.
3. Brainstorming
Brainstorming is done with a group of people who focus on identification of risk for the projects.
4. SWOT Analysis (strength,weakness,opportunities and threats)

Strengths and weaknesses are identified for the project and thus, risks are determined.

5. Write the software that be used to assist in project integration management (6%)
 Project management software is software used for project planning, scheduling, resource allocation
and change management.
 It allows project managers (PMs), stakeholders and users to control costs and manage budgeting,
quality management and documentation and also may be used as an administration system.
 Project management software is also used for collaboration and communication between project
stakeholders.
Although project management software is used is a variety of ways, its main purpose is to facilitate the planning
and tracking of project components, stakeholders and resources.

Project management software caters to the following primary functions:

 Project planning: To define a project schedule, a project manager (PM) may use the software to
map project tasks and visually describe task interactions.
 Task management: Allows for the creation and assignment of tasks, deadlines and status reports.
 Document sharing and collaboration: Productivity is increased via a central document repository
accessed by project stakeholders.
 Calendar and contact sharing: Project timelines include scheduled meetings, activity dates and
contacts that should automatically update across all PM and stakeholder calendars.
 Bug and error management: Project management software facilitates bug and error reporting,
viewing, notifying and updating for stakeholders.
 Time tracking: Software must have the ability to track time for all tasks maintain records for third-
party consultants.

6. Write the difference and their similarity between hard skills and soft skills (4%)

 Hard skills, also called technical skills, are job-specific, relevant to each position and seniority level. In
other words, each position in every company will require a unique hard skills list. For example, an
accountant needs to know how to reconcile bank statements, while that knowledge is unnecessary for a
 developer. At the same time, reconciliation is important for accountants no matter their level of
experience, but preparing business budgets is a skill that’s not usually required of a junior accountant.

 Soft skills are general characteristics, relevant to personality traits. Some soft skills you’d like to see in
all employees regardless of their position or expertise, while other soft skills make sense in certain jobs
and are less important in others. For example, if you value collaboration in your company, you want to
hire employees who are great team players and can communicate well with others. On the other hand,
networking and relationship-building skills might be essential for sales and marketing roles, but
irrelevant for engineering roles. Likewise, leadership abilities make sense for people who’ll manage a
team no matter their department.
 Hard skills refer to the job-related knowledge and abilities that employees need to perform their job
duties effectively.
 Soft skills, on the other hand, are the personal qualities that help employees really thrive in the
workplace.
 Hard skills help you identify candidates who are good on paper, whereas soft skills indicate which of
these candidates are good in person, too.
 This means that you need a good mix of hard and soft skills in every employee so that they can be
successful in their role.
7. Write at least four principle of cost management and explain them briefly? (6%)
What is Project Cost Management?
 Project cost management includes the processes required to ensure that a project team completes a project
within an approved budget. Notice two crucial phrases in this definition: “a project” and “approved
budget.” Project managers must make sure their projects are well defined, have accurate time and cost
estimates, and have a realistic budget that they were involved in approving.

Basic Principles of Cost Management

Profits: - are revenues minus expenditures.
 To increase profits, a company can increase revenues, decrease expenses, or try to do both.
 Most executives are more concerned with profits than with other issues.
 You cannot measure the potential benefits of the application without knowing the profit margin.
 Profit margin is the ratio of revenues to profits.
 If revenues of $100 generate $2 in profits, there is a 2 percent profit margin.
 If the company loses $2 for every $100 in revenue, there is a -2 percent profit margin.
Life Cycle Costing: - allows you to see a big-picture view of the cost of a project throughout its life cycle.
 This helps you develop an accurate projection of a project’s financial costs and benefits.
 It considers the total cost of ownership, or development plus support costs, for a project.
Example: A company might complete a project to develop and implement a new customer service system in one
or two years, but the new system could be in place for 10 years.
Cash Flow Analysis: - is a method for determining the estimated annual costs and benefits of a project and
the resulting annual cash flow.
 Project managers must conduct cash flow analysis to determine net present value.
 Most consumers understand the basic concept of cash flow:
 If they do not have enough money in their wallets or bank accounts, they cannot purchase
something.
 Top management must consider cash flow concerns when selecting projects in which to invest.
Tangible Costs or Benefits: - can easily be measured in dollars/Money.
Intangible Costs or Benefits:-are difficult to measure in monetary terms.
  Intangible benefits for projects often include items like goodwill, prestige, and general statements
of improved productivity that an organization cannot easily translate into dollar amounts.
 Because intangible costs and benefits are difficult to quantify, they are often harder to justify.

Direct Costs: - can be directly related to creating the products and services of the project. You can attribute
direct costs to a certain project.
Example:-
It includes the salaries of people working full time on the project and the cost of hardware and software purchased
specifically for the project. Project managers should focus on direct costs because they can be controlled.

Indirect Costs: - are not directly related to the products or services of the project, but are indirectly related to
performing the project.

Example:
It would include the cost of electricity, paper towels, and other necessities in a large building that houses 1,000
employees who work on many projects. Indirect costs are allocated to projects, and project managers have very
little control over them.
8. Compare and contrast effective and ineffective project managers in detail (4%)
 Effective Project Managers:
 Lead by example.
 Are visionaries.
 Are technically competent.
 Are decisive.
 Are good communicators.
 Are good motivators.
 Stand up to top management when necessary.
 Support team members.
 Encourage new ideas
 Ineffective Project Managers:
 Set bad examples.
 Are not self-assured.
 Lack technical expertise.
 Are poor motivators.
 Poor communicator
 Poor motivator
9. Write at least five project risk management processes (6%)
 The risk management process is a framework for the actions that need to be taken.
 There are five basic steps that are taken to manage risk; these steps are referred to as the risk management
process.
 It begins with identifying risks, goes on to analyze risks, then the risk is prioritized, a solution is
implemented, and finally, the risk is monitored.
 In manual systems, each step involves a lot of documentation and administration.
Five Essential Steps of a Risk Management Process
1. Identify the Risk
 2. Analyze the Risk
3. Evaluate or Rank the Risk
4. Treat the Risk
5. Monitor and Review the Risk
Step 1: Identify the Risk
 The initial step in the risk management process is to identify the risks that the business is exposed to in its
operating environment.
There are many different types of risks:
 Legal risks.
 Environmental risks.
 Market risks.
 Regulatory risks etc.
 It is important to identify as many of these risk factors as possible. In a manual environment, these risks are
noted down manually. If the organization has a risk management solution employed all this information is
inserted directly into the system.
Step 2: Analyze the Risk
 Once a risk has been identified it needs to be analyzed.
 The scope of the risk must be determined.
 It is also important to understand the link between the risk and different factors within the organization.
 To determine the severity and seriousness of the risk it is necessary to see how many business functions the
risk affects.
 There are risks that can bring the whole business to a standstill if actualized, while there are risks that will
only be minor inconveniences in the analysis.
Step 3: Evaluate the Risk or Risk Assessment
 Risks need to be ranked and prioritized.
 Most risk management solutions have different categories of risks, depending on the severity of the risk.
 A risk that may cause some inconvenience is rated lowly, risks that can result in catastrophic loss are rated
the highest.
 It is important to rank risks because it allows the organization to gain a holistic view of the risk exposure of
the whole organization.
 The business may be vulnerable to several low-level risks, but it may not require upper management
intervention.
 On the other hand, just one of the highest-rated risks is enough to require immediate intervention.
 There are two types of risk assessments: Qualitative Risk Assessment and Quantitative Risk
Assessment.
Step 4: Treat the Risk
 Every risk needs to be eliminated or contained as much as possible.
 This is done by connecting with the experts of the field to which the risk belongs.
 In a manual environment, this entails contacting each and every stakeholder and then setting up meetings so
everyone can talk and discuss the issues.
 The problem is that the discussion is broken into many different email threads, across different documents
and spreadsheets, and many different phone calls.
 In a risk management solution, all the relevant stakeholders can be sent notifications from within the system.

Step 5: Monitor and Review the Risk

 Not all risks can be eliminated – some risks are always present.
 Market risks and environmental risks are just two examples of risks that always need to be monitored.
 Under manual systems monitoring happens through diligent employees.
 These professionals must make sure that they keep a close watch on all risk factors.
 Under a digital environment, the risk management system monitors the entire risk framework of the
organization.
 If any factor or risk changes, it is immediately visible to everyone.
 Computers are also much better at continuously monitoring risks than people.
 Monitoring risks also allows your business to ensure continuity.