Project Management
Introduction and Overview
Prof. M Rammohan Rao
Former Dean
Professor Emeritus
Executive Director, Centre for Analytical Finance
Indian School of Business
Hyderabad
1
Acknowledgements
This material is for teaching purposes only.
Not to be distributed without explicit
permission of the author.
All the material is prepared from the
following sources.
1. C F Gray, E W Larson and G V Desai,
“Project Management, The Managerial
Process”, Tata McGraw Hill, 2010
2. S J Mantel, Jr., J R Meredith, S M Shafer,
M M Sutton with M R Gopalan, “Project
Management Core Text Book” John Wiley
India, 2011 2
3.PPT slides from the Project Management
Course at Edmund T. Pratt, Jr. School of
Engineering at Duke University, USA.
4.Project Management in Practice, A short
note by V. Srinivasa Rao.
5.Project Management Body of Knowledge
(PMBOK) Guide Fourth Edition.
6.Personal thoughts, views, ideas and
experience.
7.Project implementation status of Central
Sector Projects, April – June 2009, MOPSI
Introduction
Modified Quote from Gray, Larson and
Desai
“Some of mankind’s greatest
accomplishments – building the Taj Mahal,
discovering a cure for polio, putting a man
on the moon – began as a project.
ISB conceived and built as a project
4
Project
“Temporary endeavor undertaken to
create a “unique” product, service or
result” (Project Management Institute)
“Set of inter-related activities to
achieve a particular goal or objective”
5
Unique set of activities to achieve a
defined outcome within a specified time
frame using specific resources”.
Characteristics
Not routine work
Objective with specifications that can
be measured
Divided into interdependent tasks
Life cycle with a specified due date
Constraints on use of resources (People,
money, equipments etc.)
Budget
Achieves a desired “unique” outcome or
benefit
Vehicle for implementing strategic plans
Need for risk analysis and management
7
Projects involve managing change for
improvement
Projects move organizations from state A
to state B in a
Planned and Controlled way
A B
Project Management
Application of knowledge, skills, tools and
techniques to project activities to meet
requirement
Integrative approach
Integration of projects with strategic plan
Integration with the process of managing
Project Management
A B
9
Importance of Project Management
Business
Projects define and redefine the
business
Businesses are built through series of
projects that define
Physical infrastructure
Products and / or services that are
sold
Processes for making a product or
deliver a service
10
Future projects are identified based on
strategic needs to change or define the
company.
Assets in place :
Company may be viewed as portfolio
of assets that have been built through
various projects
11
Growth in assets :
Projects in progress and future projects
identified / to be identified in accordance
with strategic plan.
Value of a company :
Strongly depends upon the type of
projects (past, present and future) and
quality of execution of projects.
Development of country
Infrastructure
Water
Power
Transport
Roads, Ports and Airport
Space Research
Research and Development
Poverty Alleviation Schemes
Career as a certified Project Manager
Project Management Institute
http://www.pmi.org
Organization to promote project management
Provide uniform set of knowledge (PMBOK)
Certify competency in project management
skills
14
“o e “ur eys o Proje t I ple e tatio …
CIO.com cites a Dynamic Markets survey of
800 IT managers –
62% of IT projects fail to meet their
schedules.
49% suffered budget overruns
47% had higher-than-expected
maintenance costs, and
41% failed to deliver the expected
business value and ROI
Source: CNET News, 09/10/2012, 62 percent of
IT Projects fail. Why?
Refers to: Why do IT projects fail, and is there
anything we can do about it? - by Matt Asay,
March 21, 2008
http://advice.cio.com/remi/two_reasons_why_
it_projects_continue_to_fail
“o e “ur eys o Proje t I ple e tatio …
Source: Project implementation status of Central Sector Projects, April – June 2009, MOSPI
17
“o e “ur eys o Proje t I ple e tatio …
Source: Project implementation status of Central Sector Projects, April – June 2009, MOSPI
18
“o e “ur eys o Proje t I ple e tatio …
Source: Project implementation status of Central Sector Projects, April – June 2009, MOSPI
19
“o e “ur eys o Proje t I ple e tatio …
Source: Project implementation status of Central Sector Projects, April – June 2009, MOSPI
20
Strategic Project Management
• Logical Framework Approach *
– Also known as
• Goal Oriented Project Planning (GOPP)
• Objectives Oriented Project Planning (OOPP)
– Developed in 1969 for US Agency for
International Development (USAID)
• Design, Monitoring and Evaluation of
projects
* “trategi Ma age e t Made “i ple: Pra ti al Tools for Leader
a d Tea s y Terry “ h idt
Wikipedia: Logical framework approach
The logi al fra e ork approa h y Keerti Bhusan Pradhan
• Four Critical Questions
– What is to be accomplished and why
– How is success to be measured
– What other conditions are necessary
– How do we get there
• Four by four Table
– Four rows
• Describe different types of events
– Four columns
• Provide information about the events
• Four levels / rows
– Goal
• High level objective to which the project
contributes
– Purpose
• Anticipated impact from outcomes
– Outcomes
• Results that the project must deliver
– Inputs
• Activities and resources necessary to deliver
outcomes
• Four columns
– First Column
• Narrative description of event
– Second Column
• Success measures / Objectively Verifiable
Indicators (OVI)
– Third Column
• Means of Verification (MoV)
– Fourth Column
• Assumptions
–External factors that influence positively or
negatively the events
–List includes all the factors that have an
impact
–Not directly controllable
–Project dependency on external factors
–Killer assumptions
• Temporal Logic
– If activities are undertaken and the
assumptions hold, then the outputs will be
delivered
– If the outputs are delivered and the
assumptions hold, then the purpose will be
achieved
– If the purpose is achieved and the
assumptions hold, then the Goal will be
realised
Narrative Summary Verifiable Indicators Means of Important
(OVI) verification assumptions
(MOV)
1. Goal: Contribute to Decrease in eye health Testing for eye
improved eye health in the issues/ problems by a health
specified community specified percentage
2. Purpose: Increased utilization Number of persons i) Records Patients follow
of eye health services utilizing the service is at maintained the treatment
least a certain percentage ii) Survey of
population
3. Outputs: (a) Increased access i) Types and cost of i) Records People are
to eye health services services offered maintained willing to pay
(b) Provision of cost effective ii) Location of facilities, ii) Survey of the charges for
comprehensive and high quality timings of service community better eye
eye health services iii) Capability of staff health care
4 . Inputs/activities: (a) Provide i) Facilities and (i) Records Budget and
health care facilities consumables procured maintained manpower are
(b) Procure consumables and ii) Contents of training (ii) Training available
sessions
equipment sessions
iii) Attendance of staff
(c) Training of staff iv) Publicity generated conducted
(d) Create awareness (iii) Attendance
Project Life Cycle
Time between the start and end of the
project
Consists of various phases
Each phase includes
Work to be done
Set of inter-related activities
Deliverables
28
Hand off from one phase to another
Results upto that point are reviewed
Necessary directional inputs are given
Acts as a control gate
Different from Product Life Cycle
Product Life Cycle
Inception
Creation
Use till the end 29
Project life cycle is a subset of product
life cycle
Inception and creation of Product
Typical Project
Slow start followed by
Quick Momentum followed by
Slow finish
Figure 1-2 from Text: Page 7
31
Project Life Cycle Phases
Phase1: Project definition and initiation
Project Management Body of
Knowledge (PMBOK) Guide : Starting
the project
Defining stage
Project is conceived
32
Preliminary scope, budget, schedule,
etc., estimated
Approvals obtained
Project charter is deliverable
Handed over to project team for detailed
planning
Project Life Cycle Phases …contd…
Project Charter:
Document issued by project initiator / sponsor
Authorizes existence / creation of the
project
Authority to project manager to utilize
resources
Reference for making all major decisions
during project life cycle
Document includes a summary of all
important aspects considered while
authorizing the project
34
High level study should have been
undertaken prior to issue of charter
Includes
Justification of project
Alignment with strategy
Major objectives
Measurable criteria for success
High level description of
requirements and outcome of the
project
Overview of project risks
Constraints and assumptions based on
organizational and external factors
Major project activities completion
milestones / dates
Project cost estimate and budget
Nomination of project manager and
members of project team
Responsibilities and authority levels of
Name, designation and authority of
project team
person authorizing the project charter
Phase 2: Project planning and scheduling
PMBOK Guide : Organizing and preparing
Planning Stage
Integrated detailed plans for
Activities
Proactively managing
Scope, Schedule and budget
Procurement, quality and communications
Project team
Detailed plans are deliverable
Handed over for execution
37
Phase 3: Project Implementation
PMBOK Guide: Carrying out the project work
Executing Stage
Project manager and team ensure that
Work planned during the planning
stage is carried out
Authorized resources are used
Monitor and control to ensure
Quality, technical and performance
specifications
Completion as per milestones and budget
38
Phase 4: Project termination
PMBOK Guide : Closing the project
Delivering stage
Deliverables are checked to ensure
meeting
• Agreed specifications and
• Criteria for success
Settle procurement contracts
Hand over documentation and project to
client
Disbanding the team
39
Project Life Cycle Phases
…contd…
At each phase, a review process is
structured and carried out
Outcome of review is to
Continue or
Redirect or
Hold or
Terminate the project
40
Project Life Cycle Phases …contd…
Figure 1.2 from Project Management: The Managerial Process,
41 Fourth Edition, Special Indian Edition by Clifford F. Gray,
Erik W. Larson and Gautam V Desai
Program
Group of related projects :
Managed in a coordinated way
Benefits not available for managing
them individually
Examples
Golden quadrilateral corridors
Defense Research Department
Organizations’ program for
defense missile systems
42
Portfolio
Collection of projects and programs
To focus on specific business
grouped together
strategy
Wider than projects and programs
Need not be related projects
May be in different sectors
Strategic diversification
Managed at the highest managerial
level
43
Project Manager
Same functions as other managers
Plan, Schedule, Motivate and Control
Manage
Temporary and non-repetitive
Fixed life project
activities
Customer expectations
Feasible and reasonable
Create
Project Team
Structure / organization
44
Work with diverse set of people
Provide to team members
Direction, Co-ordination and
Integration
Other functional managers
Support in terms of
• Knowledge / expertise
• Availability of team members
45
Outsiders
Typically do not have project
allegiance
Vendors / Suppliers
Sub contractors
Other stakeholders
Conflict Resolution
Responsible for performance
Scope
Work Breakdown structure
Schedules
Resource allocation
Budgets
Status Reports
47
Monitoring
Quality
Appropriate trade off between Time,
Cost and Performance requirement
Closure of project
Documentation
Dissolution of team
Stakeholders
Individuals or organizations
Actively involved
Impacted by the project
Many more people than initially thought of
Different stakeholders may want different
and possibly conflicting outcomes
Communication with all stakeholders is
important
49
PMBOK Guide : Page 24 50
PMBOK Guide 51
Organization Structure
Existing functional hierarchy
Grouping by functions
Engineering, Production
Marketing, Accounting etc.
Further sub-divisions also may be there
Each employee reports to one person
52
Segments of project delegated to
functional department
Each department will do the project work
independently
May be appropriate if one functional area
has a dominant role
High ranking manager in that area is
given responsibility to coordinate Project
Advantages
No change
Flexibility in use of staff
Expertise of the dominant functional
area can be utilized
Easy transition after closure of
project
54
Disadvantages
Lack of focus
Staff have other work
Slow
Priority may be to other work
Poor Integration
Each concerned only with their work
Not concerned about fit with work
done by other departments
Lack of ownership
55
Dedicated Project Team
At the other end of the spectrum to
functional organization
Independent of other functions
Full time project manager
Team members chosen
56
Advantages
Functional organization remains in tact
Cohesive team
High motivation
Cross functional integration
Specialists from various functions work
together
Faster completion
Members devote full time
57
Disadvantages
Can be expensive
New position of project manage
Resources assigned on a full time basis
Conflict
Between team and other units
Apple example
Inadequate expertise
Expertise may be limited to only team
members
Difficult transition after closure of project
58
Matrix organization
Quote from GLD:
Matrix management works, but it sure is
difficult at times. All matrix managers must
keep up their health and take stress – Tabs
- A Project Manager
59
Hybrid organization
Project management structure is overlaid
on functional hierarchy
Two (sometimes more?) chains of
command
Project team members report to
Functional head
Project head
60
Forms of Matrix organization
Depends upon relative authority of
Functional manager and project
manager
Weak or light weight Matrix
Authority of project manager is weak
Project managers have responsibility
but weak authority
Authority strongly in favour of
functional manager
Project managers prepare
schedules, milestones, reports
etc. and monitor
Functional manager decides who
is to do what and when
62
Balanced or middle weight Matrix
Authority is shared by project
manager and functional manager
Project manager
• Establishes plan, schedules and
standards
• Monitors progress and integrates
work done by departments
63
Functional manager
• Assigns staff
• Ensures execution according to
schedules and standards set by
Project Manager
Close coordination and typically
joint approval of decisions
Strong or heavy weight matrix
Project structure within a matrix
environment
Authority is strongly in favour of project
manager
Project manager
Establishes plans, schedules and
standards
65
Decides on scope trade off and
assignment of functional personnel
Functional manager is consulted on a
need basis
Sometimes departments may be
like sub-contractors
Advantages of Matrix Structure
More efficient than project structure
Resources are shared across projects
Better project focus than functional
structure
Flexible in terms of utilization of
knowledge and expertise
Post transition is easier than in project
structure 67
Disadvantages of Matrix Structure
Conflict between project managers and
functional managers
Fighting for resources shared across
Stressful for team members
projects
No unity of command
One boss too many
PMBOK Guide : Page 28
69
Organization Culture
Project friendly culture
Team work and cross-functional
cooperation are dominant
Conflict is voiced and dealt with
effectively
Commitment to Excellence
Functional organization or weak
matrix organization can deliver results
70
Project unfriendly culture
Individualism is encouraged
Promotions / increments based on
Low tolerance for conflict
relationships with superiors
Project manager and team have to
overcome the negative forces
Better to insulate the project team from
Create a distinct team sub-culture
the organization culture
Dedicated project team is preferred.
Alternatively a strong matrix structure
would be required
Other cultural situations
Degree of project friendly culture has
to be assessed
If adequate project friendly culture
exists, balanced or strong matrix
structure may be appropriate
Otherwise, dedicated project team
may become necessary
