Presentation on theme: "CE 4101W-01 Project Management and Economics"— Presentation transcript:
1 CE 4101W-01 Project Management and Economics Fall 2005Tim Eiler
2 Class RollIf you are NOT officially enrolled in this class, see me at break or at end of class tonightAll students sign the sheet being passed aroundAll students obtain and complete an information sheet – turn in at class end
3 Agenda Why are we here tonight? Expectations – of the class, of me, of youCourse mechanics – how it all will workWhat is PM and Why is it important?Starting out with basic PMHomework 1 assigned
4 Open PM Discussion Why are you in this class? What questions do you haveabout PM?
5 What’s The Point of This Class? For those of you who see themselves as future PM’s…Figure out what PM is and isn’tMore importantly, figure out why PM is important to your businesses and careersFor those who see themselves as engineers, but not PM’s…It’s the soft stuff that’s hard, the hard stuff is easy (Doug Wilde, quoted in Leifer, 1997)“Those organizations that take project management seriously as a discipline, as a way of life, are likely to make it into the 21st century. Those that do not are likely to find themselves in good company with dinosaurs.” (Tom Peters)In the new economy, all work is project work.(Tom Peters; The Wow Project ;Fast Company, 24, 116)
7 Why Project Management (PM)? Increases profit (margin) by reducing cost/unit outputIncreasing work output by the same resourcesReducing cost of work doneDrives InnovationIn how individual contributor & management (mgmt) work is doneIn product
8 Why PM? Increases sales Improved quality Ability to be a price leader Differentiates your company“The difference between a company and its competitor is the ability to execute. If your competitors are executing better than you are, they’re beating you in the here and now…Execution is the great unaddressed issue in the business world today. Its absence is the single biggest obstacle to success…”Ram Charan & Larry Bossidy, Execution: The Discipline of Getting Things Done, 2002, Crown Business
9 Why PM?In short:Project Management (PM) strives to achieve success from entropy-driven chaos…
10 Why Is PM Important? Close to half of the projects started were A recent survey of technology projects in the United States by the Project Management Institute reveals some startling percentages:Close to half of the projects started werenever finished30% were completed but took at least twice aslong some took 5 times as longOnly 10% of the projects were finished on time
11 Secret 1 About This Course This course has wide breadth with less topic depth
12 Secret 2 About This Course Project Management (PM) isn’t rocket science
13 Secret 3 About This Course This class is yours if you choose to own it.If you choose not to get involved in it, you only have yourself to blame at the end for not getting something from it.Being involved means joining in discussions, doing the work, understanding why things are done the way they are"Learning occurs when people engage in complicated undertakings and find a way to reflect on how they're doing it - and perhaps engage a coach or mentor who has some tools and methods for learning. Those tools are different from answers. Answers are for lazy people who don't want to learn how to use a thinking method to learn how to deal with a practical problem. I have zero respect for trying to find an "answer". There is a profound difference between having an answer and having an approach you can use to deal with a complicated and difficult practical problem. "Peter Senge
14 Secret 4 About This Course “Simple is Sexy. Complex Sucks.”Rob Thomsett, Radical Project ManagementThe Story of The Skilcraft Method…
15 This is a PRACTICAL Course What You Can Expect…This is an application-level courseNeeds critical thinking…not just formulaic regurgitationThis is a PRACTICAL Course5th - Explain4th - Synthesize3rd - Challenge2nd - Listen1st - ReadProcess:3rd – Apply2nd – Practice1st – Know
16 What You Can Expect… Getting new knowledge… Examples Interactive, Socratic-style LectureListenAsk questionsAnswer questionsDiscuss topicsExamplesThe right way (we hope) firstOne planned for crucial or difficult topicsMore as you require
17 What You Can Expect… Practicing to solidify new knowledge… Facilitated PracticeUse the knowledge you haveApply it to new situationIn class assignmentGiven informationDo (use a tool, create a document, etc.)Group-style workAsk questionsHelp each other
18 What You Can Expect… Applying what you know… Requires melding of appropriate conceptsGiven in the class“Common sense” and practical experienceReadingsYou WILL NOT always have everything spelled out to you in checklist formatSometimes you will have to MAKE ASSUMPTIONS to fill in the missing pieces
19 What You Can Expect… This is a Civil Engineering course It will use mostly examples and homework related to Civil EngineeringIt is also a course in Project ManagementIt is not exclusive to Civil EngineeringNot all the examples, homework, etc will be exactly in the CE domainYou are to focus on PM 1st and CE second…I will not be evaluating you on your CE prowess
20 I Expect of You… Be An Active Learner Do the readings Attend class Ask questions & challenge the instructorActively participate in discussions & groupsSpeak up when you have a question or concernSatisfactorily complete (on time) all writing assignments, examinations, projects, homeworks & exams.Be An Active Learner
21 Syllabus Review Syllabus is posted at course site on WebCT You are responsible for printing it if youwant a printoutYou are responsible to keep up withrevision updates
22 Syllabus Review Course Objectives Teaching Team Textbook(s) Computer UseHomeworkGradingCalendarAttendanceAcademic HonestyEtc…READ THE SYLLABUS
23 Syllabus Review - Slide Decks Available via WebCTYou are responsible for printing if you want a printoutAll slides are posted already
24 Syllabus – Cont’dDemonstrate knowledge of the concepts and principles of project management and economicsFormulate and analyze project management and engineering economics problemsUse project management and communications softwareDemonstrate knowledge of teamwork and interpersonal skillsProcess group work and the overall functioning of the courseDemonstrate written and verbal skillsActively reflect on and process your learning in the courseApply concepts, principles, methods, algorithms, and heuristics
25 Syllabus – Cont’d Teaching Team Instructor: Tim Eiler Office: CE 147 Phone 1: (cell)Phone 2: (home)1:2:Office Hours: As NeededTeaching Assistant:Ryan OwenOffice:Phone:Rhetoric Consultant:Dave KmiecOffice:Phone: , (c )
26 Teaching Team – Tim Eiler Program Manager GMAC-RFC, Bloomington, MN (current)Manage software development program office and staff of project managers and technical resources (6)Adjunct Professor of Project Management U of MN, Minneapolis, MN (current)Manage and deliver project management course contentPartner RocketScienz Group LLC, Rosemount, MNGraphic Design, Web Development and Hosting, Software Development, Training, PM ConsultingRelease Manager Tellabs, Plymouth, MNLed $300M, 36-month project to develop optical broadband switchManager of Project Management Digi International, Minnetonka, MN Managed project management office/project management staffProject Manager ADC Telecommunications, Minnetonka, MN Managed broadband access equipment product development projectsProject Manager Microwave Network Systems, Houston, TXManaged microwave radio/radio network equipment development projects Astronaut Instructor Rockwell Space Operations, Houston, TXProvided multi-discipline technical training to US & foreign astronautsPMP (Project Mgmt Professional) Certification Project Mgmt Institute (PMI)MBA University of HoustonBS ME/IEOR University of MinnesotaCTM Certification Toastmasters InternationalNational Board of Directors Triangle Fraternity
27 Syllabus – Cont’d Computer Use WebCT This course uses WebCT for disseminating and collecting informationIf you don’t know how to use WebCT, contact the department office for further instructionsMS-Project and Other ToolsYou will be required to perform work using MS-Project and other software applicationsIf you do not now have access to MS-Project, please arrange to get it
28 Syllabus – Cont’d Calendar See Syllabus Shows week numbers and date of Monday of each weekExplains lecture material to be covered in class weekIdentifies prep. reading assignments for each class:PMBOK 2004 editionOtherNote that reading assignments and/or homework assignments may not seem 100% synchronous with lecture materialIdentifies work to be assigned in each classIdentifies work to be submitted in each class (or week)
29 Academic HonestyExpectation: All students are expected to complete coursework responsibilities with fairness and honesty.Definition: Scholastic dishonesty means plagiarizing; cheating on assignments or examinations; engaging in unauthorized collaboration on academic work; taking, acquiring, or using test materials without faculty permission; submitting false or incomplete records of academic achievement; acting alone or in cooperation with another to falsify records or to obtain dishonestly grades, honors, awards, or professional endorsement; altering forging , or misusing a University academic record; or fabricating or falsifying data, research procedures, or data analysis.Consequences: Scholastic dishonesty WILL result in disciplinary action. Within this course, a student responsible for scholastic dishonesty can be assigned a penalty up to and including an "F" or "N" for the course.
30 Reasonable Accommodation If you have a special need that requires any additional reasonable accommodation, I encourage you to please see or contact me at any time
31 Contract GradingTo Receive an ATo Receive a BTo Receive a CAbide by all Class PoliciesActively engage in class discussions – small group and whole classActively engage in class discussions – small groupSubmit 100% of homeworkReceive P grade on Problem/Solution MemoReceive P grade on Project ProposalReceive P grade on 100% quizzes and assignments given in classReceive P grade on 90% quizzes and assignments given in classReceive P grade on 80% quizzes and assignments given in classReceive a cumulative mean score of >= 90% for 2 examsReceive a cumulative mean score of >= 80% for 2 examsReceive a cumulative mean score of >= 70% for 2 examsReceive P grade on Project PlanComplete Writing Interview FormNOTE: In cases of conflict between these slides and the syllabus, the syllabus will have precedence
32 Grading – Cont’d Assignments Quality Exams 3 Quantity Out of class assignments In class assignments TBDQuizzes TBDMastery Learning – you may, at my discretion only, resubmit homework NLT one week following receipt of graded workQualityQuantity
33 Attendance Incredibly important in a class of this type You lose much more than your grade by not comingI will be flexible with attendance and assignments IFF…
34 Class Groups Form groups of 6 Each person to collect contact information (phone, , etc) from ALL 5 other people on the team – also submit your group’s info to meClass Group is your first line of defense. Call them 1st to:Get info you need if you missed classGet help obtaining or using a toolEtc.Class Group is your team for assignmentsIf your group shrinks < 4 people, see me
35 BreaksThe literature says that classes should be broken up to have a break after roughly every minutes of class.I assume you’re all adults, though, and you can make your own choices and follow through on those choices.Do you want 1 or 2 breaks during each class period?
36 General Course Organization PM PlanningPM ExecutionPM Leadership and EthicsProject Closure
37 What Is Project Management? Project Management is the application of knowledge, skills, tools, and techniques to project activities to meet project requirements.It is accomplished through the use of processes such as initiating, planning, executing, controlling, and closing.(PMBOK, 2000, PMI)Project Management is the intersection of:ToolsPeopleSystems(Lewis, James P Project Planning, Scheduling & Control, 3rd ed. McGraw‑Hill)
38 Why Is PM Important To You? What Employers WantLearning to LearnListening and Oral CommunicationCompetence in Reading, Writing, and ComputationAdaptability: Creative Thinking and Problem SolvingPersonal Management: Self-Esteem, Goal Setting/Motivation, andPersonal/Career DevelopmentGroup Effectiveness: Interpersonal Skills, Negotiation, andTeamworkOrganizational Effectiveness and LeadershipWorkplace basics: The skills employers want American Society for Training and Development and U.S. Department of Labor.
39 Why Is PM Important To You? Employer’s Checklist C: Boeing CompanyA good grasp of these engineering fundamentals:Mathematics (including statistics), Physical & life sciences, Information technologyA good understanding of design & manufacturing processes(i.e. understanding of engineering concepts and practice)A basic understanding of the context in which engineering is practiced, including:Economics and business practice, History, The environment, Customer and societal needsA multidisciplinary systems perspectiveGood communication skills: Written, Verbal, Graphic, ListeningHigh ethical standardsAn ability to think critically, creatively, and independently & cooperativelyFlexibility--an ability and the self-confidence to adapt to rapid/major changeCuriosity and a lifelong desire to learnA profound understanding of the importance of teamwork ASEE Prism, December 1996, p. 11.
40 Why Is PM Important To You? Desired Attributes of a Global EngineerA good grasp of these engineering science fundamentals, including:Mechanics & dynamics, Math (including statistics), Physical & life sciences, Information science/technologyA good understanding of the design & manufacturing process(i.e., understands engineering and industrial perspective)A multidisciplinary, systems perspective, along with a product focusA basic understanding of the context in which engineering is practiced, including:Customer & societal needs/concerns, Economics & finance, The environment & its protection,The history of technology & societyAwareness of the boundaries of one’s knowledge, along with an appreciation for other areas ofknowledge & their interrelatedness with one’s own expertiseAwareness & appreciation of other cultures & their diversity, distinctiveness, & inherent valueCommitment to teamwork, including extensive experience/understanding with team dynamicsGood communication skills, including written, verbal, graphic, and listeningHigh ethical standards (honesty, sense of personal and social responsibility, fairness, etc)An ability to think both critically and creatively, in both independent and cooperative modesFlexibility: the ability and willingness to adapt to rapid and/or major changeCuriosity and the accompanying drive to learn continuously throughout one’s careerAn ability to impart knowledge to othersA Manifesto for Global Engineering Education, Summary Report of the Engineering Futures Conference,January 22-23, The Boeing Company & Rensselaer Polytechnic Institute.
41 Why Writing In this Course? Professional skills – memos, reports, directives, plans, proposals, etc.Critical element of engineering and project managementKey to project management effectiveness (90% rule)Employers concerned about communication skillsWriting Intensive Curriculum Requirement
42 Why Writing Intensive?ABET Criteria Criteria for Accrediting Engineering ProgramsEngineering programs must demonstrate that their graduates have:(a) ability to apply knowledge of mathematics, science, and engineering(b) ability to design and conduct experiments, & to analyze and interpret data(c) ability to design a system, component, or process to meet desired needs(d) an ability to function on multi-disciplinary teams(e) an ability to identify, formulate, and solve engineering problems(f) an understanding of professional and ethical responsibility(g) an ability to communicate effectively(h) the broad education necessary to understand the impact of engineering solutions in a global and societal context(i) a recognition of the need for, and an ability to engage in life-long learning(j) a knowledge of contemporary issues(k) an ability to use the techniques, skills, and modern engineering tools necessary for engineering practice.Source: ABET Criteria for Accrediting Engineering Programs. Accessed June 12, available: <http://www.abet.org/images/Criteria/E001% %20EAC%20Criteria% pdf>
43 Meeting the ABET criteria Interviewing a Practicing Engineer in your Area(f) an understanding of professional and ethical responsibility(g) an ability to communicate effectivelyWriting and Peer Reviewing a Problem-Solution Memo(d) an ability to function on multi-disciplinary teamsWriting a Proposal in a Collaborative Team
44 Writing as a Process - Your writing assignments are graded pass/fail To succeed in these assignments, you will need to think of writing as a process, not a product.Be sure to follow the steps specified in the assignment for the purposes of this course. As you write in your career, you can find ways to adapt this basic process to the needs in your organization.- Your writing assignments are graded pass/failbased on whether you:* follow the writing process* apply the writing process effectively to your subject
45 Why Engineering Economics? Critical element of project managementeconomics used in making decisionsrelated to engineering projectsEven if you aren’t the decision maker, you will be a participant in some formsame principles are used for many other types of decisionsLife skills – loans, mortgages, etc.FE, PE Exam
46 Engineering Econ - Examples Is a 3-year payback on your project sufficient to meet company objectives?If you have competing repeatable projects with different lives, you can use the lowest common multiple of their project lives as the period of analysis…True or False?You just heard through the grapevine that the company is changing the way it handles depreciation expense. You shouldn’t worry about how that will affect how your project is accepted…True or False?(FE exam problem) A bank uses the following formula to compound interest in a passbook savings account F = P (1 + i/4)4n. Interest is stated as an annual rate. How are they compounding? (1) Daily, (2) Weekly, (3) Monthly, (4) Quarterly, (5) Annually
47 What Is Project Management? Earlier, we saw these definitions:Project Management is the application of knowledge, skills, tools, and techniques to project activities to meet project requirements (PMBOK, 2000)Project management focuses on a project. Management, bringing together and optimizing the resources necessary to successfully complete the project. These resources include the skills, talents, and cooperative efforts of a team of people; facilities, tools and equipment; information, systems and techniques; and money. (Haynes, 1989)So, if Project Management (PM)“focuses on a project,”what is a project?
48 What Is A Project?“A temporary endeavor undertaken to create a unique product or service”A Guide to the Project Management Body of Knowledge,Project Management InstituteA project is a one-time, multitask job with a definite starting point, definite ending point, a clearly defined scope of work, a budget, and (usually) a temporary team. Lewis (2000).… a combination of human and nonhuman sourcespulled together in a temporary organization to achievea specified purpose. (Cleland and Kerzner, 1985; Nicholas, 1990)
49 Characteristics Of A Project? Temporary, with specific endpointUniqueSpecific DeliverableSpecific Spending LimitElement of Risk(Typically) Involve groups, across organizational lines
51 Defining a Project – Current Budget = CostSchedule = TimePerformance = ItselfClient Acceptance a.k.a Customer SatisfactionQUADRUPLE CONSTRAINT
52 Is PM Art, Science, or Both? Tools-basedProcess-basedSome things are essentially same across projects & timeArtRelies on Heuristics (Rules of Thumb)Many aspects not consistent across time or projectsCritical decisions require experience basis
53 Fundamental ToolsFundamental tools for the new generation of engineers and project managers…Basic Thinking (Occam’s Razor)Systems/ systems thinking/ systems engineeringModelsTeamworkQuality
54 PM Process at the High-Level PlanningCustomer RequestExecutioncustomerinternalClosure
55 The PM Process – Detail Level SOWProject CharterRequirements DocumentWBSStakeholder AnalysiscustomerinternalNetwork DiagramCritical Path AssessmentDuration EstimationResource AssignmentScheduleComm PlanBudgetQuality PlanAdmin PlanProject Plan
56 Predictors of Lowered Project Success Unrealistic project work plansInability to deal early with suspected problem issuesTechnical complexities not well communicated to team membersConflict between client expectations and the state of deliverablesInsufficient involvement on the part of senior management early in the life cycle
58 Program Management Program Project 1 Project 2 Project n Other Function 1Function 2Function nOtherOther
59 Project Life Cycle Wild enthusiasm Disillusionment Total confusion It’s only funny because it’s so true…Wild enthusiasmDisillusionmentTotal confusionSearch for the guiltyPunishment of the innocentPraise and honors for the non-participants
60 Project Life CycleFeasibility, Planning/Design, Construction, Turnover/Startup
62 PM Attention/Methods over PLC Early: ensure project is defined correctly to:Meet the needs of the clientFit the abilities of the teamBe consistent with goals, objectives, values of the firmSpeculationMiddle: keeping project “on” triple constraint targets, negotiating project trade-offsEnd: “Punch list” mentality…ensuring everything is done and done correctly
63 PM’s Role Over PLC • Planning • Organizing • Staffing • Directing • Controlling
64 PM Role Over PLC - Planning Establish project objectives and performance requirementsInvolve key participants in the processEstablish well-defined milestones with deadlinesBuild in contingencies to allow for unforeseen problemsPrepare formal agreements to deal with changesClearly define responsibilities, schedules, and budgets1Oberlender, G.D Project management for engineering and construction. New York: McGraw-Hill.
65 PM Role Over PLC – Organizing/Staffing Develop a WBS that divides project into units of work Create a project organization chart Clearly define responsibilities, schedules, and budgetsStaffingSelect team members using work requirements andinput from appropriate managers’ input Orient team members to overall project Seek each team members’ input to define & agreeupon scope, budget, and schedule Set specific performance expectations with each teammember
66 PM Role Over PLC – Directing/Controlling Coordinate all project componentsDisplay positive attitudeBe available to team membersInvestigate potential problems as soon as they ariseResearch and allocate necessary resourcesRecognize good work of team members & guide necessaryimprovementControlling Measure project performance using record of planned &completed work Chart planned and completed milestones chartChart monthly project costsDocument agreements, meetings, telephone conversationsCommunicate regularly with team members
67 The PM Process – Planning Detail SOWProject CharterRequirements DocumentWBSStakeholder AnalysiscustomerinternalNetwork DiagramCritical Path AssessmentDuration EstimationResource AssignmentScheduleComm PlanBudgetQuality PlanAdmin PlanProject Plan
68 The Process Steps - Overview SOW – what the customer wantsCharter – turns the project “ON”, identifies project rulesRequirements Doc – Details of the customer “wants”WBS – breaks work into manageable “packages”Stakeholder Analysis – identifies who can impact projectNetwork Diagram – identifies dependencies of tasksDuration Estimation – estimates task lengthCritical Path Assessment – finds the longest scheduleResource Assignment – assigning the right people to tasksSchedule – ND + Duration Estimates + ResourcesCommunication Plan – who needs to know what, when, howBudget – based on estimates, how many & for projectQuality Plan – how quality of project output will be ensuredAdmin Plan – how mundane aspects of the project will be handledProject Plan – single location of most of the above (and more)
69 What it takes to be successful PM Relentless PlanningVisionServant Leadership ApproachDelegationCommunicationSupportOptimismTenacityBalanceListeningAccountability
70 PM: A Different Way of Thinking Required PM (indeed, management in general) requires a different way of thinking that most engineers are taught to use.YOU have to figure out how to make the transition .The good thing is that the shift is not as difficult as it might first seem.
71 Where Do Projects Come From? It is not only all about the customer…It all starts with the customer!Customer’s needInternal vs external customer
72 Where Do Projects Come From? So how does the customer tell the “do-er” what is needed (and constraints)?The Statement of Work (SOW)
73 Statement of Work (SOW) What is the purpose of an SOW?Is an SOW created before or after charter?Who is accountable for creating the SOW?What are the “typical” contents of a SOW?Narrative description of the work/deliverables required for the project contractBefore OR After…depends on type of project and who the “vendor” isThe “customer” who requires the final outputUser-level requirements
74 SOW Constraints Documentation Rules Procedural Methodology Materials What documentation is requiredTesting resultsManufacturers’ literatureSamplesProduct dataColor selectionsEtc.When documentation is requiredFormat required for documentation
75 Statement of Work (SOW) There is no “official standard version” of an SOWAn example (paper airplane)
76 Where Do Projects Come From? Every project a company executes either contributes to that company's success of that company's failure. There is no in-between. A project that "does no harm" uses resources that could be better spent on a project that contributes to the company's objectivesAll projects are not created equal. Every project contributes differently. In is not in the company's best interests to treat projects equally.There are more good projects than there are resources with which to accomplish them. The corollary is "you can not do them all." Many foolish companies try to do too much and the result of this is poor quality, missed dates, cost overruns, and dissatisfied customers.Not all projects contribute to all corporate objectives. It would be nice if everything we did contributed to every company objective, but the do not and will not. It is acceptable to have a project that does not contribute to one or more company objectives. It is even acceptable from time to time to have a project that actually goes against an objective!
77 Case Study Used In Course The Situation:The Avanti Motors Corporation of Norcross, GA, has begun production of the Studebaker XUV and needs a new parts warehouse (depot) in the midwest. They’ve chosen Bloomington, MN, have purchased the land, and have solicited bids. Your company (your group) submitted a bid and won.Further Definition To Be Available In:SOWHomework Instructions
78 Case Study Used In Course Statement Of WorkParts Depot333 W 78th StBloomington, MNAvanti Motor Corporation of America19740 Inglewilde DrNorcross, GeorgiaMark Ross, Customer Representative
79 Case Study Used In Course General RequirementsNot ApplicableSite work2.1 ExcavationFlat and compacted to support slab foundation and building2.2 LandscapingTurfConcrete3.1 Footing and SlabPoured, reinforced concrete3.2 Parking lot and street edgingCurb and gutter3.3 WallsPrecast, reinforced concrete
80 Typical Project Documents Request For Information (RFI)A memo requesting specific information from someoneTransmittalA memo that introduces/outlines/explains the material being sent (much like a fax cover sheet)
81 Homework 1Genuinely and sincerely thank at least one person who performs routinecleaning maintenance on a building in which you work or live.Doing this activity in person is strongly recommended. If you choose todo this activity other than in person, you must include a copy of anycorrespondence you use to accomplish it.You must provide the name of this person and the building in which s/heworks. You must also provide me with some way of remotely contactingthis person (phone number or address preferred).Submit via hardcopySubmit in next class (no late homework accepted)Your signature must be on the submitted version
82 Homework 1Find 2 examples of SOWs to study and submit as part of the assignment. Answer the following questions:What is the expected outcome required by each SOW (describe briefly)?Were the formats similar? If not, what were some of the major differences between them?Was the content of each similar even if the formats were not? What were some of the similar content items? What were some of the different content items?Who (organization) wrote each SOW? Who was the SOW being given to do the work to develop the expected outcome (if you can tell)?Submit by hardcopy a copy of each SOW and the answers to the questions.Submit in next class (no late homework accepted)
83 Statement of Work (SOW) What is the purpose of an SOW?Who is accountable for creating the SOW?What are the “typical” contents of a SOW?Narrative description of the work/deliverables required for the project contractThe “customer” who requires the final outputUser-level requirements
84 User-Level Requirements What is a User-Level Requirement?I (the customer) want the output to do xI (the customer) want the output to be like yHow is a User-Level Requirement different than other requirements?Focus on the need rather than the how need fulfilledOften less detailed than requirements used to design/develop output
85 The Project Charter Who is accountable for creating project charter? The Project SponsorWhat does charter tell the project team & others?There is a project (formal authorization)The project’s output will be “x” (product description)The business need fulfilled by the project is “y”The project manager will be <name>The project manager has accountability & responsibilityThe project will have listed constraints & assumptions
86 Project Charter Break into support groups In 10 minutes, create a project charter for the paper airplane projectIf you have a question the answer to which all groups might need to know, please ask itTurn in a copy of the charter with all group members’ names affixed
87 RequirementsDetailed description of the external perceptions of the desired outcome of project (triple constraint…transforming into quadruple constraint)Can be several “levels” or “layers” of requirements, each with successive levels of detailed (recommended) or tailored to a different audience (be careful).One of most reliable methods of ensuring project success is to have (& widely communicate) correctly & fully documented requirements
88 RequirementsNeed to be clear, complete, reasonably detailed, cohesive, attainable, and testableTake care to involve as many of a project’s stakeholders in requirements development as feasible. Anyone who could later derail the project should her/his expectations not be met should be included as a customer here.Quality Function Deployment (QFD) is a good tool for requirements development if you have available time to use it
89 Requirements Semantics Will:Shall:Should:Used to indicate a factual statement or assumption“This class will end” “This class will end on time”Used to direct mandatory action“The student shall complete the homework”Synonyms include must, required to, necessary toUsed to request non-mandatory work“The student should purchase supplementary reading materials”
90 Statement of Work (SOW) Your design/build firm has been contracted to act as general contractor design and install a new parts depot at 333 W 78th St in Bloomington, MN for the Avanti Corporation of America. The company is based in Norcross, GA and has just launched the Studebaker XUV into the American automobile market. It also currently sells two models of the Avanti sports car originally introduced in 1963 by the original Studebaker Corporation of South Bend, IN.At the initial meeting with your team, the client told you that it already has chosen the site.The rough particulars of site and building are:Facility to be used for automobile parts (14,000 parts) warehousing & some light assembly100,000 total square feet – 200’ x 500’ (lot size is 500’ x 1000’, details as attached)One storySteel frameConcrete pre-fabricated exteriorSteel stud & drywall interiorTwo closed offices (each 15’ x 15’)One conference room (20’ x 20’)Lunch room (20’ x 20’)Restrooms (1 each for male and female)Loading dock (2 delivery stalls)Air conditioning & heating plant required to support entire spaceSecurity & fire suppression systems required to support entire spaceOn-site parking required – 2 visitor spaces, 5 employee spaces
91 Statement of Work (SOW) Break into support groupsIn 5 minutes, create as detailed an SOW as possible for building a 3-car residential garage
92 Project Evaluation Criteria These are the measurements which the Project Manager (and hopefully others) will use to judge whether the project has been successful:Along the wayWhen the project is completeWhy is this important? If you have:a car that gets 30 mpg,10 gallons of gas in the car$50 for $2/gallonOne dayHow far could you go?To what city could you get?
93 Project Evaluation Criteria To be manageable, criteria must originate from project goals & objectives (there is an important difference between those concepts, by the way)GoalObjectiveFrom where do the goals and objectives – and then eval criteria - come?What manageable targets should the evaluation criteria cover? (hint: TC)Do they need to be approved once they’ve been identified? If so, by whom?
94 Small Team Kickoff Meeting PM gather personnel on the internal teamMeet to discuss the initial requirements-generation part of the project (a mini-project of its own, for the most part)Establish objectivesReview the process to be followedDetermine the information to be obtainedEstablish team member data-gathering/other roles to perform
95 Goals, Objectives (and Tasks) What’s the difference?Goal: very broad in scope, only the final outcome measurableObjective: a clearly measurable outcome, typically related to triple/quadruple constraintTask: A specific, measurable activity required to accomplish the objective(s)Determining which is which is often as much art as science
96 Defining Requirements Requirements are the detailed description of the external perceptions of the desired outcome of the project (triple constraint…transforming into quadruple constraint)Requirements need to be clear, complete, reasonably detailed, cohesive, attainable, and testable
97 Defining Requirements One of the most reliable methods of ensuring project success is to have (and widely communicate) correctly and fully documented requirementsTake care to involve as many of a project’s stakeholders in requirements development as feasible. Anyone who could later derail the project should her/his expectations not be met should be included as a customer here.Quality Function Deployment (QFD)
98 Project Planning is Extremely ITERATIVE Why? Because projects are progressively elaborated!Concept Note: Rolling Wave Planning
99 Reflective ListeningSOW, Requirements Documents, and charter (and other documents) “talk to each other”Acceptance Criteria – how will the customer/you know when the project is done?
100 Requirements Analysis/Agreement Review SOW, specs, drawings for completenessDocument issues in Requests For Information (RFI)Get customer addendums and do it all again until you’re satisfied
101 Reflective Listening Example SOW says: “3.0 No more than three folds”Requirements Document (Rdoc) says:“Requirement 3.0: No more than three folds3.1 Direction of folds not specified3.2 That any/all folds must be in parallel direction not specified3.3 That folds must be all in same direction not specified”From where did the Rdoc get the added detail?
102 Organization Types Differentiated by: Whether PM coordination is vertical or horizontalHow much authority a PM hasOn a linear continuum from functional to projectizedFunctional: silos, staff reports to a mgr, PM reports to a mgrMatrix: staff report to both mgr and PMWeak MatrixBalanced MatrixStrong MatrixComposite: same as matrix, but there is a “functional” PM groupProjectized: everyone reports to a PM (but…)Mixed: Some projectized, some matrixImportant because it affects how a PM manages
103 Organization Types - Functional CEOEngineeringManufacturingHuman ResourcesFinanceStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffProject control
104 Organization Types - Functional Advantagestechnological depthHigh degree of standardization and control in each siloDrawbackslines of communication outside functional department slowtechnological breadthproject rarely given high priority
105 Organization Types - Matrix CEOEngineeringManufacturingHuman ResourcesFinanceStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffProject controlIn a Balanced Matrix, one staff is replaced by a PMIn a Composite Matrix, PM has its own functional organization
106 Organization Types - Matrix Advantagesflexibility in way it can interface with parent organizationstrong focus on the project itselfcontact with functional groups minimizes projectitisability to manage fundamental trade-offs across projectsDrawbacksviolation of the Unity of Command principlecomplexity of managing full set of projectsconflict
107 Organization Types - Projectized CEOPM 1PM 2PM 3PM 4StaffStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffStaffProject controlThere is likely to be a separate network of functional managersA Mixed Organization is a mix of projectized, matrix/functional
108 Organization Types - Projectized AdvantagesEffective and efficient for large projectsResources available as neededBroad range of specialistsshort lines of communicationDrawbacksMay require high levels of duplication for some specialtiesExpensive for small projectsSpecialists may have limited technological depthNo “home” for staff at end of project
109 Organization Types - PMO Project Management Office (PMO)Not very standard in objective/workMay be responsible for providing support functions (project coordination, other admin functions), to providing “process ownership” and training, to actually being responsible for project resultsSometimes known by other namesProject Management Process GroupProject Management Center Of ExcellenceCentral Concept - InnovationDominant Project Characteristics - Overlapping, Fewer boundariesMain Thrust - Modifying and Adapting DemandsMetaphor - DesigningMeans - Creativity, Higher Technology Ability
110 Organization Types - Summary FunctionalWeak MatrixBalanced MatrixStrong MatrixProjectizedPM AuthorityLittle/NoneLimitedLow/ModerateModerate/HighHigh/Total% assigned personnel full-time on project workVirtually None0-25%15-60%50-95%85-100%PM RolePart-timeFull-timeCommon PM TitlesProject Coordinator/ Project LeaderProject Manager/ Project OfficerProject Manager/ Program ManagerPM Admin StaffPart-time, if anyProject Management Institute, 2000, PMBOK, p. 19
111 Organization Types - Selection Organization types typically evolve,rather than get “selected”Some factors influencing the evolution1. Technology2. Finance and accounting3. Communication4. Responsibility to a project/product5. Coordination6. Customer relationsCentral Concept - InnovationDominant Project Characteristics - Overlapping, Fewer boundariesMain Thrust - Modifying and Adapting DemandsMetaphor - DesigningMeans - Creativity, Higher Technology Ability
112 Organization Types - Selection Why would an organization choose functional form over projectized form?Why would an organization choose strong matrix from the matrix options?Central Concept - InnovationDominant Project Characteristics - Overlapping, Fewer boundariesMain Thrust - Modifying and Adapting DemandsMetaphor - DesigningMeans - Creativity, Higher Technology Ability
113 Project PlanOnce the SOW and charter are available, PM begins the process of creating the Project Plan.The Project Plan is a document that essentially:Helps organize the project planning processHelps communicate project planning informationPuts all project planning information into one, easily-obtained locationWhy is is important to have a PM process?
114 Elements of a Project Plan Overviewbrief description of projectdeliverablesmilestonesexpected profitability and competitive impactintended for senior managementObjectivesdetailed description of project’s deliverablesproject mission statementGeneral Approachtechnical and managerial approachesrelationship to other projectsdeviations from standard practicesContractual Aspectsagreements with clients and third partiesreporting requirementstechnical specificationsproject review dates
115 Project PlanNow that you know what a Project Plan is, is for, and what specific concept areas make up its contents, we’re going to move on.Keep those concepts in mind, however, as we move along.The tools you learn during the next few weeks feed the Project Plan (they become the contents).
116 Work Breakdown Structure What is a WBS?deliverable-oriented grouping of project components that organizes and defines the total scope of the projectWhat is a DELIVERABLE?
117 Work Breakdown Structure What a WBS does:Break the work down into smaller, more manageable parts (what does “more manageable” mean?)Clearly/visually show the full scope of the projectWork not in the WBS is OUTSIDE scope of the projectAids development/confirmation of common scope definition/understanding
118 Work Breakdown Structure Break down the project level either by functional area/activity or by timeline area/activity (Gozinto Analysis)Can be graphical or numbered text (outline) formatEach descending level represents an increasingly detailed description of project deliverables
119 Work Breakdown Structure How to create it:Break the work down (decompose the work) into smaller, more manageable parts (Identify deliverables)Until sub/deliverables are defined in sufficient detail to support mgmt (can adequate duration & cost estimates be developed?)Each descending level represents an increasingly detailed description of project deliverablesID tangible, verifiable constituent components of deliverables (to facilitate performance measurement)Verify correctness of the decomposition
120 Create a WBS using this information WBS ExerciseThe following activities must be accomplished to complete an officeremodeling project:ActivityEstimated Duration (Days)Procure Paint2Procure New Carpet5Procure New Furniture7Remove Old Furniture1Remove Old CarpetScrub WallsPaint WallsInstall New CarpetMove in New FurnitureCreate a WBS using this information
121 WBS Exercise 1. Create a WBS 1.0 Office Remodel Project1.1 Procure1.1.1 Procure Paint1.1.2 Procure New CarpetRequest BidsPurchaseReceive Carpet1.1.3 Procure New Furniture1.2 Prepare1.2.1 Remove Old Furniture1.2.2 Remove Old Carpet1.2.3 Scrub Walls1.3 Install1.3.1 Paint Walls1.3.2 Install New Carpet1.3.3 Move in New Furniture2. Is this (at right) organized by project life cycle phase or by function?3. What would happen when decomposing deliverables far in the future?
122 1.0 Office Remodel Project WBS Exercise1.0 Office Remodel Project1.1 Procure1.2 Prepare1.3 Install1.1.1 Procure Paint1.1.3 Procure New Furniture1.1.1 Remove Old Furniture1.1.3 Scrub Walls1.1.1Paint Walls1.1.3 Move In New Furniture1.1.2 Procure New Carpet1.1.2 Remove Old Carpet1.1.2 Install New CarpetRequest BidsPurchaseReceive Carpet
123 Network Diagrams Put the work into a flow/logical sequence Ok, up to now you’ve learned to:Receive the customer specificationOfficially start the projectGet the requirements rightFigure out who the project stakeholders are and what they wantBreak the work downSo now what?Put the work into a flow/logical sequenceIdentify and assign resourcesCreate a schedule plan
124 Network Diagrams How does PM put activities in logical order? Purpose Activities progressively dependent upon each otherStart at the project end and work backwardStart at the project start and work forwardPurposeGives schematic display of the logic relationships of project activitiesNote: Sequence order – NOT time orderHelps find which activities most important according to current plan
125 Network Diagrams The Language of Network Diagrams: Task: specific work items that require resourcesActivity: Synonymous with task, but may also be task groupsEvent: Zero-time, zero-resource state resulting from completion of one or more predecessor activitiesMilestone: Zero-time, zero-resource marking point (significant progress, etc)Network: Diagram of nodes & lines (arrows) showing work flow logicPath: Series of connected activities between 2 or more nodes
126 Network Diagrams Dependencies AON vs AOA Finish-Start: successor can’t start until predecessor finishesFinish-Finish: successor cannot finish until predecessor finishesStart-Start: successor can’t start until predecessor startsStart-Finish: successor can’t finish until predecessor startsAON vs AOAAON = Activity on Node(Precedence Diagramming – PDM)AOA = Activity on Arrow(Arrow Diagramming – ADM)
129 Sticky Note Project Planning It really ISN’T project planning, but…It is what is often done in practical settingsIt is network diagrammingIt leads to the initial stages of schedulingHow To:Group (project team) activityOne task per sticky noteTask nameTask descriptionEstimated duration (see estimating duration)Arrange sticky notes in network diagram formDraw/string arrows to indicate dependenciesRearrange, add tasks as required
131 Network Diagram Example The following activities must be accomplished to complete an officeremodeling project:ActivityEstimated Duration (Days)Procure Paint2Procure New Carpet5Procure New Furniture7Remove Old Furniture1Remove Old CarpetScrub WallsPaint WallsInstall New CarpetMove in New Furniture
133 Estimating Activity Duration THE WORK:Tim shall walk across the room, turning off the projector along the way, & then write “The Instructor Is Only As Good As His or Her Students” on the chalkboardYOUR TASK:Individually estimate (write it) how long (seconds) the work will take(30 seconds)B) In Groups, estimate (write it) how long the work will take(3 minutes)How did your individual estimates compare to group estimates?Why?What strategies did you use to derive the estimates?Consistency of estimate…
134 Estimating Activity Duration 1. Heuristic: Activity length between 0.5% and 2% of project duration. E.G. If an activity takes a year, each activity should be between a day and a week.2. Critical activities that fall below this range should be included.3. If the number of activities is very large (say, above 250), consider dividing the project into subprojects, and individual schedules developed for each. Why?
135 Responsibility Assignment A next step beyond WBS for process of assignment of resourcesMust have a good “catalog” or “database” of resource capabilitiesUse functional managers to assign resources
136 Network Diagrams - CPM CPM = Critical Path Method Critical Path Method used to determine the longest time for the project to take according to planCritical PathPath that, if delayed, will delay completion of projectThe series of activities that determines project durationThe longest path through the projectChange in start or finish time of a critical task will affect project endCritical TimeTime required to complete all activities on the critical path
137 Network Diagrams - CPMCalculate float to determine which activities have the least scheduling flexibilityFloat = amount of time a task may be delayed without impacting project finish date(a/k/a total slack)Visual Method:Find EVERY pathAdd each pathLongest path is critical path
138 Find the critical path and the critical time CPM ExampleFind the critical path and the critical time
139 CPM - Practice Bus Shelter Construction Example Job Name Duration ResourcesPredecessor(s)1Shelter Slab2252Shelter Walls1113Shelter Roof222,44Roof Beam3225Excavation236Curb and Gutter2357Shelter Seat124,68Paint1179Signwork122,6
141 Bus Shelter Construction Critical Path Method ResultsACTNAMEDURRESEARLYLATEFLOATCURstartCRITPATHSTFNTOTFREE1Shelter Slab24YESShelter Walls53Shelter Roof810Roof BeamExcavation6Curb andGutterNO7Shelter Seat9PaintSignwork
142 Slack BUT – only within limits. Since critical path activities cannot be delayed without causing the project to be delayed, it follows that activities not on the critical path CAN be delayed without delaying the project.BUT – only within limits.
143 Slack Critical Path activities have 0 slack The amount of time a non-critical path task may be delayed without delaying the project end (or internally to the network, a later task) is calledslack or float.33Task 1Task 2StartEnd3Task 3
145 PERT PERT = Program Evaluation Review Technique Formula calculation using std dev of project completion date using weighted averages of the durationsUses 3 input estimates of duration to counter uncertainty in the individual activity durations (CPM only uses 1)Low duration (fastest likely)Medium duration (most likely)High duration (longest likely)
146 PERT Sometimes called “Method of Moments” Network Diagrams often mistakenly called PERT ChartsExamples of projects in which PERT is good?
147 Network Diagrams - PERT MS Project PERT representation
148 QuestionsKnowing what you have learned up to this point in the course:What are some likely things that can cause project failure? (Impact, Probability)What are some things you can try as PM to overcome the possible, typical causes of project failure?
149 Scheduling What is scheduling? Bringing together as much information as is known at a given time regarding tasks, tasks sequence, and task durations
150 Scheduling What is the purpose of scheduling? Helps PM/Team determine project task order, time requirements, personnel requirements/choices, budget, etc.“Whole project” big pictureVisual representation“One Stop” ConvenienceMonitor/ControlWhat If? AnalysisRisk ID/Assessment
151 Scheduling How is scheduling done? What do we know already? What do we need to find out?How should we go about getting that info?
152 Scheduling What do we know already? Activities Identified (WBS) Activities Sequenced (Network diagram)
153 Scheduling What do we need to find out? Estimates of how long the tasks will takeHow should we go about getting the info?Personnel assignmentsExpert inputHistorical informationCan/should PM do this on her/his own?
154 Resource Planning Who/What else could/should be involved? Impacted by Organizational StructureFunctional Managers?Expert Staff?Resource skills database?Other PMs?Historical records?
155 Scheduling At what level should PM’s schedule be? Top-down estimationBottom-up estimationHow do you think the organizational structure of the company affects this effort?
156 Responsibility Assignment A next step beyond WBS for process of assignment of resourcesMust have a good “catalog” or “database” of resource capabilitiesUse functional managers to assign resources
157 Milestone Chart Used as a high-level summary Typically Zero-Time EventsEasier to understand for managers Sometimes also called Waterfall Diagram because of the way the milestones tend to “flow” downward over time in the chartMilestones may be events “inside” or “outside” schedule
158 Milestone Chart CE 4101W-01: Spr 2005 Class start Exam 1 Exam 2 Exam 3 Grades postedJanFebMarAprMay
159 Milestone Chart CE 4101W-01: Fall 2003 Labor Day 9/3 Class start 9/4 Exam 110/7Exam 211/4Exam 312/9Grades posted12/19SepOctNovDecJan
160 Milestone Chart - Example Break into support groups5 minutesUsing the course syllabus, create a milestone chart of the course assignments and exams
161 Gantt Chart Used to represent the timing of tasks Column 1 = task, each additional column is a time periodEach task on its own rowExpected time for each task represented by a horizontal barLeft end of the bar marks the expected beginning of the taskRight end of the bar marks the expected end of the taskTasks may run sequentially, in parallel, or overlappingMilestones (tasks with no time) may be included (represented by diamonds, triangles, etc)
163 Gantt SchedulesProject progress is marked by filling in a task barTask 175%Task 210/7Task 3Task 4Task 5t1t2t3
164 Modified Gantt Chart Possible Modifications: Show dependencies (this example)Show resource assignmentsTask roll-ups (this example)
165 Modified Gantt ChartBetter way to do task ID notation
166 Scheduling - Practice Break into support groups…In 10 minutes: Draw two network diagrams (AON, AOA)Determine the critical path (CPM)Draw a Gantt AND a Modified Gantt chart
167 Scheduling Computer Tools Which ones are there?Microsoft ProjectABT Project Manager WorkbenchPrimavera Tools (SureTrak, Expedition, etc)MS-Office tools (Exel, Word, Access, etc)What are they good for?Automation of tasksHandling large numbers of tasksResource leveling“Any form of network analysis in which scheduling decisions are driven by resource management concerns (e.g. limited resource availability or difficult to manage changes in resource levels).”Resource HistogramAMS RealTimeScitor Project SchedulerArtemisMany OthersPower to handle complex tasks“What if” Analysis
168 Scheduling Computer Tools Example Schedule in Microsoft ProjectUse information from previous exercise
169 Project CalendarsProject Scheduling Tools have the option of setting project calendarsNumber of hours/workdayNumber of workdays/weekDefault setting is *usually* 7 8-hour days/week
170 Project CalendarsWhy is it important to set your calendar for the correct days of the week, correct hours per day, and correct holidays?How should overtime be factored into the project (tool) calendar?
171 Theory Of Constraints What is it (TOC)? Real systems must have at least one constraint – a factor that limits the system from getting more of whatever it is trying to achieveTo achieve more, one must manage the constraint(s)TOC models system as a chain. To improve strength of a chain, must identify weakest link & concentrate efforts on strengthening weakest link
172 Theory Of Constraints TOC Goals: Increase system throughput Reduce work in process (WIP)Decrease costsReduce lost income by achieving schedule prediction 90+% of time
173 Theory Of Constraints Processes & Tools Problem-solving tools - the Thinking Processes (TP) – logically/systematically answer 3 questions needed for process of on-going improvement: "What to change?", "To what to change?" & "How to cause the change?";Daily management tools - taken from Thinking Processes - can be used to significantly improve vital management skills, such as communication, effecting change, team building and empowermentProven solutions - created by applying Thinking Processes to specific application areas, such as production (as introduced in The Goal), distribution (Its Not Luck), Marketing/Sales (Its Not Luck), project management, & setting company direction, to name only a few.
174 Theory Of Constraints How does it work? Identify the System's constraints.Analyze process to identify task/activity limiting system productivityDecide how to exploit the system's constraints.Modify/redesign task/activity to perform work more effectively/efficientlySubordinate everything else to the step 2 decision.Direct all efforts to improving performance of constraining task/activity &other tasks/activities directly affecting constraining task/activityElevate the system's constraint.Add capacity to increase (elevate) output of constraining task/activityIf a constraint has been broken in previous step, go back to step 1 but do not allow inertia to cause a new constraintThis sets up a process of ongoing improvement
175 Theory Of Constraints How to identify constraints? Look for bottlenecksCan stem from physical constraints or policy constraintsPhysical:Machine, people, facilities, tangible sourcesEasier to identify and breakPolicy:Rules, training, measures (RTM)More difficult to identify and breakIdentify possible constraints in a building project
177 Critical Chain Rules: Aggressive estimates Planned pad hierarchy Parkinson’s LawStudent SyndromeInclude dependencies other than time in management focusNo multi-tasking on critical chainRelay-runner ethic/systemReport early finishesAggregate safety (buffers) and manage to the buffers
179 Communication Planning What is Project Communication?Exchanging project-specific information from sender to recipientCommunication is best done when it is:Recipient-focusedDone to serve an end
180 Communication Planning What is Communications Planning?Determining the information and communications needs of the stakeholders:Who needs information?What information do they need?When will they need that information?What options do you have to give them the information and which way(s) are best?
181 Communication Planning What’s the purpose of it?How is it done?Why not just do it “on the fly” instead of early/in the project planning stages?Does it change with scale (duration, cost, complexity) of project? Other scales?
182 Communication Planning Who needs information?Do internal stakeholders need more or different information than external stakeholders? Explain…
183 Communication Planning What data/information do they need?What’s the difference between “data” and “information?”
184 Communication Planning Communication Management Plan:Methods/procedures for info collection/storage structureDetails of data/info distribution structure for various data/info typesDescription of data/info to be distributedSchedules showing when each type of communication is anticipated to be producedMethods for accessing data/info between scheduled communicationsMethods for updating/refining the CMP over timeReview PMBOK Chapter 10!
185 Communication Planning When will they need that information?Before “event”During “event”After “event”Periodically vs. ad hoc
186 Communication Planning What options do you have to give them the information and which way(s) are best?ReportsBriefingsStatus meetingsOthers?
187 Communication Planning What options do you have to give them the information and which way(s) are best?ReportsBriefingsStatus meetingsOthers?
188 Communication Planning - Example Project: Student going to schoolStakeholder nData/Info Needed?Main Distrib Method(s)?When Distrib?How Distrib?Methods/Procedures for info collection/storageMethods for data access between scheduled communicationsMethods for updating/refining CMP over timeWho is responsible?When will it be done?
189 Typical Project Documents SubmittalA specific artifact/item to be reviewed for approval, archived, etc.TransmittalA memo that outlines/explains submittals included with the transmittal and the actions required by the recipient
190 Typical Project Documents There are no world-wide formats for these documents.Formats will be:Company specificRecipient specificIndustry specificProject specific
191 Procurement PlanningIs it likely that you will be able to do all the work with internal resources?How do you decide what to outsource?How do you procure the outsourced work?
192 Procurement PlanningProcurement Management Plan: Describes how procurement process – from solicitation planning through contract closeout – will be managedTypes of contracts to be usedIf independent estimates to be used, who will prepare them and whenIf there is a procurement organization in your company, what actions PM/Project Team can take independentlyWhere procurement documents can be foundHow each contractor will be managedHow procurement processes will coordinate with other PM processesIncludes your SOW to the contractor
193 Make or Buy Analysis Expert Judgment Lease vs. Buy Analysis Do you have the right resources for the job?Do you have the right skills to do a quality job?Experts might include: internal experts, other units, consultants, professional and technical associations, other industry groups, etc.Opportunity Cost Analysis & Cost/Benefit AnalysisCan we use internal resources more productively than this job?Lease vs. Buy Analysis
194 Opportunity Cost What is it? Why is important? The cost of making a trade-offWhy is important?A well run business or project doesn’t have a great deal of excess (i.e. unallocated) cash/other resources lying aroundProjects compete with one another for resourcesGoal is to optimize use of limited supplyRequires making trade-offs
195 Cost/Benefit Analysis Cost Benefit Analysis is a tool to evaluate optionsIs it worth spending $5000 to crash a schedule and gain 5 days?Is it worth dropping a product feature from this software release in order to be able to achieve the baseline schedule release or would it be better to keep the feature and slip the scheduled release by 20 days?You first need to have the costs and benefitsCosts and benefits must be in a quantifiable unit (dollars, production units gained or lost, days, etc.)Costs do NOT have to be in equivalent units to BenefitsYou also need to know the acceptable target tradeoff range(s) if there are absolute values (otherwise, rely on relative comparisons)I once caught a fish this big |
196 Buy vs. Lease Lessor: The one who owns the capital Lessee: The one receiving the capitalA lease “acts like” an amortized purchase – for both lessor and lesseeWhy lease instead of buying?Avoid technical obsolescenceTax advantagesAsset/payment flexibilityWhy buy instead of leasing?Possibility of salvage value + value obtained from asset use being greater than amortized costTax advantages
197 Main Types of Contract Who has the risks in each type? Firm Fixed PriceBuyer pays seller a set amount regardless of seller costsFixed Price Incentive FeeBuyer pays seller a set amount & seller can earn additional fee if performance criteria are metCost Plus Fixed FeeBuyer reimburses seller costs plus a fixed profit feeCost Plus Incentive FeeBuyer reimburses seller costs & seller earns profit if performance criteria metTime & Material (T&M)“Hybrid” of cost reimbursement and fixed feePurchase OrderWho has the risks in each type?
198 SolicitationSend bid/proposal request documents to prospective vendorsPresumes you have a sufficient list of applicable vendorsDistribution may be direct, via bidder conference, via advertising, etc.Bid & Quote used when selection based on priceProposal used when other than price (tech skills, etc) paramountRequest for Bid (RFB), Invitation to Bid (IFB)Request for Quote (RFQ), Invitation to Quote (IFQ)Request for Proposal (RFP), Invitation for Proposal (IFP)Include SOW, description of required response/response format, explanation of pro forma contract terms and agreement structure
199 Solicitation Obtain bids/proposals from sellers Evaluate bids/proposals & cycle thru SOW updatesSelect bidder (based on criteria), negotiate, & award contract
200 ContractsYou are the owner of a small excavation contracting business that has a multi-year T&M contract with a customer. The contract specifies the rate of pay for personnel types on the project.Qualify the risks you face related to management of the contract.Qualify the risks the buyer faces.
201 Quality For Project Managers What does the word “quality” mean?Features and functionalityScope requirements filled and working properlyConformance to specification or designFitness for useDegree of excellence at an acceptable priceControl of variability at an acceptable costHow well the product fits patterns of user preferencesWhy is it important for the PM to focus on quality?Driver of customer satisfaction: Triple/Quadruple ConstraintTime (schedule)Cost (budget)Performance (specifications/quality)
202 Quality For Project Managers What is the cost of quality?Prevention costs – costs incurred to prevent failure and minimizeappraisal costsAppraisal costs – discovering the condition of the process orproductInternal Failure costs – costs due to raw materials, WIP, or finished goods not being manufactured right 1st timeExternal Failure costs – costs from customer discovering a lack ofproduct quality
203 Quality For Project Managers Management’s Role:Ask questions:What is next?What can I do?PreachTeachBe an exampleProvide resourcesSeek never-ending improvementFollow Deming’s 14 pointsIt is the PM’s role to be a leader of quality in your projects
204 Quality Systems You Can Use TQM (Kaizen/Continuous Improvement)Six SigmaISO standardsQuality CirclesMinnesota Quality AwardBaldrige AwardDeming Prize
205 Total Quality Management TQM (Total Quality Management)Objective: Improve quality by analyzing the whole “production process” using quantitative and qualitative informationMethod:Clear, visible leadership from topEnsure that the system is ‘known’Use statistical measurements to monitor the systemUse statistical measurements to make changes only when needed and relatively predictableUse statistical measurements to monitor the changes(PLAN, DO, CHECK, ANALYZE)
206 Fourteen Points of Quality Create constancy of purpose toward improvementAdopt the new philosophyCease dependence on inspection.Minimize total costsConstant and perpetual improvementInstitute trainingInstitute leadershipDrive out fearBreak down internal barriersEliminate slogans, targets etc.Eliminate management by objectiveRemove barriersInstitute program of education and self-improvement.Everybody’s job is to accomplish the transition.- W. Edwards Deming
207 Deming’s 7 Deadly Diseases Lack of constancy of purpose to improve products & services by providing resources for long-term planning, for research, & for trainingAn emphasis on short-term profits & quarterly dividendIndividual performance evaluations through merit ratings & annual reviewsManagers who are highly mobile & hop from company to companyManagement use of numbers & figures that are visible & available with no thought of info that may be needed, but unknown or hiddenExcessive medical costsExcessive legal liability costs, which can be swelled by lawyers who work on “contingency” fees
208 Continuous Quality Improvement Four Basic PrinciplesDevelop a Strong Customer Focus2. Continually Improve All ProcessesIdentify ThemImprove Them (Plan, Do Check, Act)3. Involve Employees4. Mobilize Both Data & Team Knowledge to Improve Decision Making(The Memory Jogger: A Pocket Guide of Tools for Continuous Improvement and Effective Planning)
209 Six Sigma Six Sigma Objective: Method: A comprehensive and flexible system for achieving, sustaining, and maximizing business success. Six Sigma is uniquely driven by close understanding of customer needs, disciplined use of facts, data, and statistical analysis, and diligent attention to managing, improving, and reinventing business processes.Encompasses a broad array of business best practices and skills (some advanced, some common sense) that are essential ingredients for success and growth.Applicable to all types of organizationsAs much about people excellence as technical excellenceMethod:There are many “Six Sigma Ways.” – there is no fixed prescriptionSort of a culmination/combination of various other systems
210 Six Sigma – Essential Themes A genuine focus on the customerData- and fact-driven managementProcess focus, management & improvement as an engine for growth & successProactive managementBoundaryless collaborationA drive for perfection, and yet a tolerance for failure
212 Identify core processes & key customers Six Sigma RoadmapIdentify core processes & key customersDefine customer RequirementsMeasure current PerformancePrioritize, analyze & implement improvementsExpand & integrate six sigma systemDMAIC: Define, Measure, Analyze, Improve, Control
213 Six Sigma – Methods/Tools Continuous ImprovementProcess Design/RedesignAnalysis of VarianceBalanced ScorecardVoice of the CustomerCreative ThinkingDesign of ExperimentsProcess ManagementStatistical Process Control
214 ISO Standards ISO standards (900x, 1400x, etc.) Objective: Method: Improve processes & reduce process variationMethod:“Tell me what you’re going to do. Do it. Show me that you did it.”Set requirements for process performance in various operational areasCompany establishes process to comply with the ISO specificationsRegistrar evaluates company ISO systemISO system meets/exceeds ISO standard, company is “certified”/”registered”ISO system does not meet/exceed, company goes back to previous stepCompany uses periodic audits to validate process validity and adherenceInternalExternal (registrar)Failures found during audits must be dealt with via a process established as part of the company’s ISO system
215 Quality Circles Objective: Method: Improve product quality by soliciting group input from workers (and sometimes customers and/or users) in order to improve product process, features, etc.Method:Bring teams together to brainstorm solutions to a problem, then implement the ones that seem logical, are generally desirable, and are economically feasible and see what happens.
217 Procurement PlanningIs it likely that you will be able to do all the work with internal resources?How do you decide what to outsource?How do you procure the outsourced work?
218 Procurement PlanningProcurement Management Plan: Describes how procurement process – from solicitation planning through contract closeout – will be managedTypes of contracts to be usedIf independent estimates to be used, who will prepare them and whenIf there is a procurement organization in your company, what actions PM/Project Team can take independentlyWhere procurement documents can be foundHow each contractor will be managedHow procurement processes will coordinate with other PM processesIncludes your SOW to the contractor
219 Make or Buy Analysis Expert Judgment Lease vs. Buy Analysis Do you have the right resources for the job?Do you have the right skills to do a quality job?Experts might include: internal experts, other units, consultants, professional and technical associations, other industry groups, etc.Opportunity Cost Analysis & Cost/Benefit AnalysisCan we use internal resources more productively than this job?Lease vs. Buy Analysis
220 Opportunity Cost What is it? Why is important? The cost of making a trade-offWhy is important?A well run business or project doesn’t have a great deal of excess (i.e. unallocated) cash/other resources lying aroundProjects compete with one another for resourcesGoal is to optimize use of limited supplyRequires making trade-offs
221 Cost/Benefit Analysis Cost Benefit Analysis is a tool to evaluate optionsIs it worth spending $5000 to crash a schedule and gain 5 days?Is it worth dropping a product feature from this software release in order to be able to achieve the baseline schedule release or would it be better to keep the feature and slip the scheduled release by 20 days?You first need to have the costs and benefitsCosts and benefits must be in a quantifiable unit (dollars, production units gained or lost, days, etc.)Costs do NOT have to be in equivalent units to BenefitsYou also need to know the acceptable target tradeoff range(s) if there are absolute values (otherwise, rely on relative comparisons)I once caught a fish this big |
222 Buy vs. Lease Lessor: The one who owns the capital Lessee: The one receiving the capitalA lease “acts like” an amortized purchase – for both lessor and lesseeWhy lease instead of buying?Avoid technical obsolescenceTax advantagesAsset/payment flexibilityWhy buy instead of leasing?Possibility of salvage value + value obtained from asset use being greater than amortized costTax advantages
223 Main Types of Contract Who has the risks in each type? Firm Fixed PriceBuyer pays seller a set amount regardless of seller costsFixed Price Incentive FeeBuyer pays seller a set amount & seller can earn additional fee if performance criteria are metCost Plus Fixed FeeBuyer reimburses seller costs plus a fixed profit feeCost Plus Incentive FeeBuyer reimburses seller costs & seller earns profit if performance criteria metTime & Material (T&M)“Hybrid” of cost reimbursement and fixed feePurchase OrderWho has the risks in each type?
224 SolicitationSend bid/proposal request documents to prospective vendorsPresumes you have a sufficient list of applicable vendorsDistribution may be direct, via bidder conference, via advertising, etc.Bid & Quote used when selection based on priceProposal used when other than price (tech skills, etc) paramountRequest for Bid (RFB), Invitation to Bid (IFB)Request for Quote (RFQ), Invitation to Quote (IFQ)Request for Proposal (RFP), Invitation for Proposal (IFP)Include SOW, description of required response/response format, explanation of pro forma contract terms and agreement structure
225 Solicitation Obtain bids/proposals from sellers Evaluate bids/proposals & cycle thru SOW updatesSelect bidder (based on criteria), negotiate, & award contract
226 ContractsYou are the owner of a small excavation contracting business that has a multi-year T&M contract with a customer. The contract specifies the rate of pay for personnel types on the project.Qualify the risks you face related to management of the contract.Qualify the risks the buyer faces.
227 Quality For Project Managers What does the word “quality” mean?Features and functionalityScope requirements filled and working properlyConformance to specification or designFitness for useDegree of excellence at an acceptable priceControl of variability at an acceptable costHow well the product fits patterns of user preferencesWhy is it important for the PM to focus on quality?Driver of customer satisfaction: Triple/Quadruple ConstraintTime (schedule)Cost (budget)Performance (specifications/quality)
228 Quality For Project Managers What is the cost of quality?Prevention costs – costs incurred to prevent failure and minimizeappraisal costsAppraisal costs – discovering the condition of the process orproductInternal Failure costs – costs due to raw materials, WIP, or finished goods not being manufactured right 1st timeExternal Failure costs – costs from customer discovering a lack ofproduct quality
229 Quality For Project Managers Management’s Role:Ask questions:What is next?What can I do?PreachTeachBe an exampleProvide resourcesSeek never-ending improvementFollow Deming’s 14 pointsIt is the PM’s role to be a leader of quality in your projects
230 Quality Systems You Can Use (some) Quality SystemsTQM (Kaizen/Continuous Improvement)Six SigmaISO standardsQuality Circles
231 Total Quality Management TQM (Total Quality Management)Objective: Improve quality by analyzing the whole “production process” using quantitative and qualitative informationMethod:Clear, visible leadership from topEnsure that the system is ‘known’Use statistical measurements to monitor the systemUse statistical measurements to make changes only when needed and relatively predictableUse statistical measurements to monitor the changes(PLAN, DO, CHECK, ANALYZE)
232 Fourteen Points of Quality Create constancy of purpose toward improvementAdopt the new philosophyCease dependence on inspection.Minimize total costsConstant and perpetual improvementInstitute trainingInstitute leadershipDrive out fearBreak down internal barriersEliminate slogans, targets etc.Eliminate management by objectiveRemove barriersInstitute program of education and self-improvement.Everybody’s job is to accomplish the transition.- W. Edwards Deming
233 Deming’s 7 Deadly Diseases Lack of constancy of purpose to improve products & services by providing resources for long-term planning, for research, & for trainingAn emphasis on short-term profits & quarterly dividendIndividual performance evaluations through merit ratings & annual reviewsManagers who are highly mobile & hop from company to companyManagement use of numbers & figures that are visible & available with no thought of info that may be needed, but unknown or hiddenExcessive medical costsExcessive legal liability costs, which can be swelled by lawyers who work on “contingency” fees
234 Continuous Quality Improvement Four Basic PrinciplesDevelop a Strong Customer Focus2. Continually Improve All ProcessesIdentify ThemImprove Them (Plan, Do Check, Act)3. Involve Employees4. Mobilize Both Data & Team Knowledge to Improve Decision Making(The Memory Jogger: A Pocket Guide of Tools for Continuous Improvement and Effective Planning)
235 Six Sigma Six Sigma Objective: Method: A comprehensive and flexible system for achieving, sustaining, and maximizing business success. Six Sigma is uniquely driven by close understanding of customer needs, disciplined use of facts, data, and statistical analysis, and diligent attention to managing, improving, and reinventing business processes.Encompasses a broad array of business best practices and skills (some advanced, some common sense) that are essential ingredients for success and growth.Applicable to all types of organizationsAs much about people excellence as technical excellenceMethod:There are many “Six Sigma Ways.” – there is no fixed prescriptionSort of a culmination/combination of various other systems
236 Six Sigma – Essential Themes A genuine focus on the customerData- and fact-driven managementProcess focus, management & improvement as an engine for growth & successProactive managementBoundaryless collaborationA drive for perfection, and yet a tolerance for failure
238 Identify core processes & key customers Six Sigma RoadmapIdentify core processes & key customersDefine customer RequirementsMeasure current PerformancePrioritize, analyze & implement improvementsExpand & integrate six sigma system
239 Six Sigma – Methods/Tools Continuous ImprovementProcess Design/RedesignAnalysis of VarianceBalanced ScorecardVoice of the CustomerCreative ThinkingDesign of ExperimentsProcess ManagementStatistical Process Control
240 ISO Standards ISO standards (900x, 1400x, etc.) Objective: Method: Improve processes & reduce process variationMethod:“Tell me what you’re going to do. Do it. Show me that you did it.”Set requirements for process performance in various operational areasCompany establishes process to comply with the ISO specificationsRegistrar evaluates company ISO systemISO system meets/exceeds ISO standard, company is “certified”/”registered”ISO system does not meet/exceed, company goes back to previous stepCompany uses periodic audits to validate process validity and adherenceInternalExternal (registrar)Failures found during audits must be dealt with via a process established as part of the company’s ISO system
241 Quality Circles Objective: Method: Improve product quality by soliciting group input from workers (and sometimes customers and/or users) in order to improve product process, features, etc.Method:Bring teams together to brainstorm solutions to a problem, then implement the ones that seem logical, are generally desirable, and are economically feasible and see what happens.
243 ISO Standards ISO standards (900x, 1400x, etc.) Objective: Method: Improve processes & reduce process variationMethod:“Tell me what you’re going to do. Do it. Show me that you did it.”Set requirements for process performance in various operational areasCompany establishes process to comply with the ISO specificationsRegistrar evaluates company ISO systemISO system meets/exceeds ISO standard, company is “certified”/”registered”ISO system does not meet/exceed, company goes back to previous stepCompany uses periodic audits to validate process validity and adherenceInternalExternal (registrar)Failures found during audits must be dealt with via a process established as part of the company’s ISO system
244 Quality Circles Objective: Method: Improve product quality by soliciting group input from workers (and sometimes customers and/or users) in order to improve product process, features, etc.Method:Bring teams together to brainstorm solutions to a problem, then implement the ones that seem logical, are generally desirable, and are economically feasible and see what happens.
246 Inspection YOU CAN’T INSPECT QUALITY INTO A PRODUCT Inspection OLD WAY: Check at the end of a process to see if it meets specified parameters. Throw away or rework (and check again) output that doesn’t meet specifications.YOU CAN’T INSPECT QUALITY INTO A PRODUCTNEW WAY:Confirm the process is in statistical control by checking planned random samples of output at planned stages of the processFeedback to the production process to correct the process for future revisionsThrow away or rework (and check again) output that doesn’t meet specificationsWhere will you find inspection during your typical projects?
247 BenchmarkingSystematized, planned method of looking at processes other than the one in which you’re interested toCompare the process in question to the comparable processesFind out new ways to make the process in question better (Best Practices)Be very careful with benchmarking…It seems easy, but without proper analysis, it is very easy to fool oneself into thinkingthat a = b = c and that is NOT ALWAYS THE CASE.
248 FlowchartingCan’t improve a process until all understand and agree what the process actually isFlowchart is a model of the processImprovement can come in the form of:Whole team working in concert rather than against each otherMake changes to the process stepsEliminateShortenRearrangeStartStep AStep BNoPass?YesStep CEnd
249 Pareto Analysis The 80/20 chart Used to determine priorities May be able to determine what you can do to fix the problem directly from this chartMay need to subsequently use other tools to figure out what to fixOnce you’ve corrected the first priority problem, may need to go through subsequent roundsProcess step AProcess step BDefectsProcess step CProcess step D
250 Ishikawa DiagramAlso known as Cause & Effect Diagram, Fishbone DiagramThe process of chart creation is itself useful (discussion that causes people to learn)Helps keep focus on issue at hand, reducing complaints & irrelevant discussionResults in an active search for the causeData often must be collected for studyDemonstrates the level of understanding…more complex the diagram, the more sophisticated the users are about the processProblem AgnosticMajor Cause 1Major Cause 2May also be situation desiredMinor CauseMinor CauseMinor CauseMinor CauseMinor CauseProblem to solveMajor Cause 3Major Cause 4
251 Fault Tree Analysis/FMEA “What happens if” chartStudy causes and effects of failuresFocuses thinking on system functioning and interaction of system component partsDefine all ways that a system can failDecomposes potential faults through several fault ‘layers’Allows assignment of risk factors to the possible faultsNext probable step is a ParetoA.0A.1A.2A.3A.3.1A.3.2
252 Statistical Process Control Run ChartTrend analysisHistogramScatter PlotShould use some statistical validation as well as visual
253 Statistical Process Control Control ChartsSometimes called Statistical Process Control (SQC) or Statistical Quality Control (SQC)A run chart with statistically determined upper and lower control limits drawn on either side of the process average. (limits are NOT specifications)Every process has variation. Once the process is in statistical control (i.e. it is running on its own – no special correcting influence from humans – and there are very few points beyond the control limits), it is possible to more economically and scientifically decrease variation in the process outputSpecial cause: 90%. easier to eliminate. Show up as points outside the limitsCommon cause: 10%. changeable only by managementUpper Control Limit (UCL)AverageMeasurement (# defective, etc)Lower Control Limit (LCL)timeRule of 7: a process can be out of control even if there are no outliers…for instance, when there are 7 contiguous points on either side of the line.You’ll never eradicate variation…(“average” will get in your way), but see Deming point 5
254 Process Auditing Auditing Independent, objective review of the effectiveness of a systemProcessProductSystemManagementIdentify whether process failure is common cause or special causeProvide for tracking of appropriate corrective actions to processEveryone dislikes being criticized, but REMEMBER that the audit function is intended to help the company be better at what it does.Being better can mean a competitive advantage (cha-ching) or, as in most cases, it can simply mean that you are able to remain competitive (like the ante into a poker game).Don’t hate the auditor…unless he comes to deserve it!
255 SimulationSet up models of a process or situation and vary parameters to see what outcome will be after simulating what might happen“What if” AnalysisOnce the model is established and verified, varying a parameter by a specified amount and see what happens to the outcome parameter(s)Monte Carlo SimulationOnce the model is established and verified, vary a parameter or parameters through use of randomized (statistically distributed histogram randomization) trials to see what happens to the outcome parameter(s).
256 Quality Function Deployment Focus on creating a connection between quality, from the perspective of the user, through the ENTIRE process of creationQFD matrices are used to show the links between the user’s quality concepts and technical quality. Successive decompositions of needs-related quality into quality associated with subsystems allows relation of every important aspect of project quality to competitive qualityDesign RequirementsComponent CharacteristicsKey ProcessesControl MethodsCustomer RequirementsDesign RequirementsComponent CharacteristicsKey ProcessesProduct PlanningProduct DesignProcess PlanningProcess Control Planning
257 Quality For Project Managers Please Remember:1)No chart or equation will ever improve a process…People improve processes2)Think before you decide.Numbers are only models of reality.Garbage In…Garbage Out (GIGO)
258 Project Budgeting “It’s hard to predict, especially the future” – Niels Bohr“Life is what happens when you’re making other plans”– John LennonIf it’s so hard to predict and everything is already obsolete by the time it’s “on paper,” why budget?
259 Project BudgetingBudgets are plans for allocating organizational resources to project activitiesMust forecast required resources, quantities needed, when needed, and costsBudgets help tie project to organizational objectivesRequires decisions of priorityBudgets can be used as tool by upper management to monitor and guide projectsWe anticipated spending $100M by this time. How much did we actually spend?
260 Zero Base BudgetingMost budgeting is done by multiplying a factor x “last year’s budget data”ZBB calls for starting from a “clean sheet of paper” and then estimating the necessary functions from educated “scratch.” Often goes hand-in hand with Activity Based Costing Practice.This can be tedious, but is very useful because it requires you to think about each budget line item more clearly
261 Zero Base Budgeting Non ZBB: ZBB: This year’s budget had $5000 for employee project management trainingFor next year’s budget, because we know that we are intending to continuously move toward PM practice at our company (but don’t have everything planned out yet), we’ll “bump” the budget up from last year by 1.5ZBB:Throw out last year’s budgetStart over with a total replanning effort using more distinct, factual analysis
262 Top Down BudgetingBased on collective judgements and experiences of top and middle managers.Overall project cost estimated by estimating costs of work packages/major tasks from WBSAdvantagesAccuracy of estimating overall budgetErrors in funding small tasks need not be individually identifiedDisadvantagesMay miss a material, though small-appearing, item
263 Project BudgetingHow Top-Down Budgeting works (a very, very basic example):WBS Task Cost2.0 Design $50,0003.0 Concrete $500,0004.0 Frame $200,0005.0 Electrical $ 75,000
264 Bottom Up Budgeting WBS identifies elemental tasks Those responsible for executing these tasks estimate resource requirementsTechnical EstimationTime & Cost EstimationAdvantageMore accuracy from detailed lower-level analysisDisadvantageTedious, longNot focused on larger picture; can get lost in detailsGIGO
265 Project BudgetingHow Bottom-Up Budgeting works (a very, very basic example):WBS Task Resource Duration (day) Cost2.0 Design $44,1602.1 Site Survey $ 7,6802.2 Architectural Design $24,0002.3 Drafting $12,4803.0 Concrete3.1 Excavation3.2 Pour Concrete3.3 Test Concrete4.0 Frame4.1 Arrange Materials4.2 Erect Walls5.0 Electrical5.1 Arrange Materials5.2 Run Circuit Wiring5.3 Test Electrical Systems
266 Work Element Costing Determine resource requirements, then task costs fixed costs (e.g., materials)labor time & labor rateequipment time & equipment rateOverhead/G&ALevels of EstimateROM = Rough Order of Magnitude (~20% accurate, 10 minutes)System Estimate (~10% accurate, 1 day)Unit Estimate (~5% accurate, 1-3 weeks)
268 Work Element CostingEngineering News Record, http//:www.enr.com/cost/cost1.aspENR publishes both a Construction Cost Index and a Building Costs Index that are widely used in the Construction Industry. This web site contains an explanation of the indexes methodology and a complete history of the 20-city national average for the CCI and BCI.Both indexes have a material and labor component. In the second issue of each month ENR publishes the CCI and BCI, materials index, skilled labor index and common labor index for 20 cities and the national average. The first issue also contains an index review of all five national indexes for the latest 14 month period.ENR also publishes various materials prices in each issue for the 20 US cities and 2 Canadian cities. The first issue of the month contains prices for paving asphalt, portland cement, ready-mix concrete, concrete block, brick and aggregates. The second issue for the month has prices for various pipe including reinforced concrete pipe, corrugated steel pipe, PVC water and sewer pipe, ductile iron pipe and copper water tubing. The third issue of the month contains prices for lumber, plywood, plyform, particle board and gypsum board. The fourth issue of the month has prices for structural steel reinforcing bar, aluminum, and stainless steel sheet and plate. If a month has 5 Mondays, the fifth issue will have union wage rates for 21 trades in all 20 cities.The 20 US cities that ENR maintains cost data on are: Atlanta, Baltimore, Birmingham, Boston, Chicago, Cincinnati, Cleveland, Dallas, Denver, Detroit, Kansas City, Los Angeles, Minneapolis, New Orleans, New York, Philadelphia, Pittsburgh, St. Louis, San Francisco, Seattle. ENR also tracks cost data for Montreal and Toronto, Canada.In addition, ENR publishes four quarterly cost reports in the last issue of March, June, September and December. These issues analyze cost trends from ENR’s data base and explain the movement in the indexes. They also contain various other cost data including open-shop wage rates, workers compensation rates and international prices, wages and cost indexes just to name a few.Tim Grogan, Senior Editor, Costs, Data & Material Prices.
271 Estimating ExpertiseThere is no evidence of mystical inborn talent for cost- estimating.‘Expertise’ is not a universal phenomenon, but rather very project-specific.The most crucial attributes of good estimators are knowledge and care.Good estimators have exactly the same attributes as good gamblers:they research selectively and thoroughly.they weigh each decision against possible outcomes & behave accordinglyDifferent building types demand different approaches.Special attention is required for complexity of the project.The easiest projects to estimate are the industrial factories and residential houses.Office construction projects are hardest to estimate, due to design/option varietySkitmore, R.M., Stradling, S.G., & Tuohy, A.P Human effects in early stage contract price forecasting. IEEE Transactions on Engineering Management, 41 (1),
272 Hybrid Budgeting Best of both Top-down and Bottom-up mixed Can be conflict (in fact, you want it)If you have the time and the expertise available, this is, IN MY OPINION, the best approach
273 Future Value (FV) Find FV of $1 today invested for n years at i%/year Timeline MethodFV1 = PV1 (1 + i)54321$PVi%FV1FV2FV5FV4FV3FV = PV (1 + i)nGeneric Case Equation
274 Present Value (PV)Find PV of $1 today of FV dollars received n years in the future, assuming i%/yearPV = FV x FV(1+i)n (1+i)n=
276 Group WorkUse Timeline Method: How much money will be your return at the end of 5 years with 5% annual interest on a deposit of $500How would the situation change if you had a second investment of $250 in the third year? How would the formulaic calculation change?Think of 3 specific examples when you might need to know the concept of PV/FV and how to calculate it.
277 Annuity What is it? How is it calculated? A series of equal payments at fixed intervals for aspecified number of periodsE.G. – marketing tells you that Project X, of which you’ll be the PM, will generate $1M per year for 5 years starting at project release in January 2005How is it calculated?FVAn = PMT/(1+i) + PMT/(1+i)2 + … + PMT/(1+i)t= PMT Σ 1/(1+i)tt=1n
278 Annuity Example Why is it important? Promise to pay $1000/year for 3 years. If you were to receive this money and invest it with a 4% return, how much would you have at the end of 3 years?321i%$1000i =t =n =PMT =Are we solving for PV or FV?Answer?Why is it important?Couldn’t we just do an FV analysis on a $5M payback at the end of 5 years in the 5 year, $5M project example?In the example above, what amount of money would you want to receive now to be able to turn down the $1000/year for 3 year deal?
279 Net Present Value (NPV) NPV = Σ (FVt / (1+i)t) - It=1FVt = incremental, after tax net cash flow in year tI = the investment (capital outlay), which is assumed to all happen in year 0)NPV > 0 is good (project or activity may be chosen)
280 Depreciation Paying the equipment Methods Suppose you buy a machine for $100k, use it for 5 years to do “your thing,” and then scrap it. The cost of the work produced by the machine must include a charge for the machine (depreciation).As depreciation increases, net income decreasesUnlike paying the staff, depreciation is NOT a cash charge – cash flows are not decreased…Depreciation actually increases cash flow!!!MethodsStraight LineDouble declining balanceSum of the years’ digitsAccelerated Cost Recovery System (ACRS)Modified Accelerated Cost Recovery System (MACRS)
281 Depreciation Straight Line Method (Purchase Amount – Salvage Value) / Depreciation lifeDepreciation Life determined by the estimated useful life of the assetSalvage Value = value the asset is expected to have at end of depreciation lifeYear 1Year 2Year 3Year 4Purchase ValueSalvage ValueWhat is the effect on cash flow of changing the salvage value?
282 Modified Accelerated Cost Recovery System MACRSSum of purchase price for any year x the depreciation % for that yearDepreciation Life determined by Asset Class rulesClassAsset Type3 yearComputers & research equipment5 yearAutomobiles, tractors, light duty trucks, computers7 yearIndustrial equipment, furniture, fixtures10 yearCertain long-lived equipment27.5 yearResidential rental property31.5 yearNon-residential property
283 MACRS Continued21.5 and 31.5 year class property uses straight line method3, 5, 7, 10 year class property uses accelerated method in table below (or alternative straight line method for very small businesses)Ownership year35710133%20%14%10%245322518151917144121311968
284 MACRS ContinuedHalf-year convention: Assumes property put in service in middle of first year – extends recovery period by one more year (3 year class property is depreciated over 4 years)Depreciable basis: Purchase price + shipping and installation costs [NOTE: NO classes allow salvage value as part of depreciable basis]Salvage Value: Add the difference of (actual sale price – undepreciated value) to normal operating income for taxation at the normal rateE.G. - $100k equipment with 5 year class life sold at end of year 4 for $25k$25,000 – ($100,000( )) = $8000 to add to operating income
285 MACRS ExampleExcellanz buys a computer for $150k. It requires an additional $15k for delivery and $15k for installation. The company expects to be able to sell the equipment for $25k at the end of the straight line depreciable life.What is the depreciable basis?What is the depreciation for each year and the total depreciation?
286 Baselines What is a baseline? When are the “snapshots” taken? “snapshot” of project schedule, cost (budget), or scopeWhen are the “snapshots” taken?When the plan (schedule, scope (budget), scope) is considered feasible technically and in terms of resourcesHow are they used?Used as the basis for measuring and reporting actual performance against the plan (schedule, cost, scope)Used to manage project changes to scope, schedule, cost (i.e. – get rid of the “creep”)
287 Homework 4 Posted via WebCT Project Control and Configuration Mgmt Risk MgmtProject BudgetingDue 7/18 via hardcopyWork in support groups (only)
288 SimulationSet up models of a process or situation and vary parameters to see what outcome will be after simulating what might happen“What if” AnalysisOnce the model is established and verified, varying a parameter by a specified amount and see what happens to the outcome parameter(s)Monte Carlo SimulationOnce the model is established and verified, vary a parameter or parameters through use of randomized (statistically distributed histogram randomization) trials to see what happens to the outcome parameter(s).
289 Risk Management What is it? Risk is anything that affects triple constraint objectivesPMBOK: Systematic process of identifying, analyzing, and responding to project risksAKA: Crossing bridges before you get to them
290 Risk Management Why do it? The future is uncertain When those unplanned, unplannable good or bad things happen to a project, the PM must be ready to deal with them and their consequences in order to meet the triple/quadruple constraint
291 Risk Management How do you manage risks? Initiate the process, Identify the risks,Assess/analyze the risks,Organize (rank) the risks,Plan responses to the important risks,Implement the RMP (Risk Management Plan),MonitoringReportingRespondingReview (cyclical)
292 The RMP Table How you do it? - The Risk Mgmt Plan table Risk IdentifierRiskProbability of risk occurrence (P)Impact if risk occurs (I)Risk “Rank”Risk OwnerMonitoring PlanResponse StrategyResponse Plan (outline)
293 Risk Management Risk Identifier Helps you track the risk Helps you communicate the riskMay be nothing more than a sequential systemMay be something other than sequentialWhat do you do with the risk ID when the risk “goes away?”Critical person lost time injuryFire damages structureRain delay to critical path taskCritical person lost time injuryFire damages structure
294 Risk Management Risk (Identification) Something that affects triple constraint objectivesNegativePositive (Examples?)Measurable/Quantifiable is best, but sometimes there will be qualifiable-only risksRisks can be identified with use of many tools, methodsProject Plan, Network Diagram, Schedule, Policies, Expert Opinion, Historical Information, WBS, FMEA, etc.Risk identified by a group effortRisk identifiedAt project startOver and over, repeatedly, again and again, until project end
295 Risk Management Probability of risk occurrence (P) How likely is the risk event?Can be classified by judgmentCan be classified by statistical tools
296 Risk Management Impact if risk occurs (I) What will happen if the risk event occurs?Can be classified by judgmentCan be classified by statistical tools
297 Risk Management Risk Rank You can’t have everything…where would you put it?P x IGroup all the equally ranked items togetherThere can be multiple 1, 2, 3, etc.If multiple 1’s, 2’s, etc, can rank inside each group (use time of likely occurrence, relative impact, etc)May have to go through several rounds of successively detailed analysis to get top (10, 20, 50, 75, 100)
298 Risk Management Risk Owner Handles monitoring & responding (within constraints)Why doesn’t the PM just do the risk monitoring?Who can the PM assign to be a risk monitor?
299 Risk Management Monitoring Plan How/what will you/r team watch to see if the risk may be happening?Discuss some examples
300 Risk Management Response Strategy Accept Mitigate Avoid Avoid: Do something to ensure risk won’t occur (100% mitigation)Mitigate: Accept that risk might happen, but do something to alleviate the either/both the P or I if it doesAccept: What’s left when there’s nothing feasible to doTransfer: Do something to allocate the risk onto someone elseAcceptMitigateAvoid
301 Who is responsible for keeping the Risk Management Plan (RMP)? Response PlanWhat do you intend to do if the risk starts happening/happens?In outline form – things change too rapidly, frequently to warrant moreWho is responsible for keeping the Risk Management Plan (RMP)?
302 Risk ManagementExample:Project: Create a lighted sign for a new building into which an engineering forensics company will be moving in 2 months.RMP creation example/discussion
303 Risk Management In support groups: Project: Build a four-car garage Constraints: Cost not to exceed $10,000, Construction to be completed NLT 2 months from project initiationComplete an RMP with 10 risks. At least 3 must be cost-related, 3 must be quality-related, and 4 must be schedule-related
304 Schedule ManagementHow can you use a project schedule to actually manage (not just plan) a project?How do you collect status from the people doing the work?GIGOReporting/data gathering systemsuse of % complete
305 Schedule Compression Scheduling is extremely iterative process In fact, changes during last few days are likely!Management always wants it done faster and/or cheaper!So how can you shorten the schedule?Scope Modification: Delete task(s)Crashing: Adding more resources to task(s)Fast Tracking: Doing more tasks in parallel
306 Schedule Compression Scope Modification Eliminate task(s) Shrink work required to do particular task(s)Not always viable – why not?
307 Schedule Compression Crashing Add more resources to shorten time required to do the work (1+1=2)Not always feasible/viable option – why not?Appropriate resources may not be available at all or only with equal or worse impactLearning curves can actually result in 1+1=0.5Can increase cost more than budget allows
308 Schedule Compression Fast Tracking Reworking task sequencing so more activities are done in parallel rather than sequentiallyNot always feasible/viable option – why not?Often results in reworkIncreases risk (often dramatically)Increases confusion
309 Schedule CompressionCan we agree that getting the project done late (after pre-agreed time) is BAD?Is it BAD to come in ahead of schedule:By a little bit?By a lot?Why/Why not?
310 Configuration Management What is it?Establish revision control and change control methodsSimilar to baselineWhy is it done?Communication – keeping everyone on the same pageLimit unnecessary scope creepChange impact estimationWork billing
311 Configuration Management How does it work?Written process (per project, per company, etc)Identify change possibility (acceptable person?)If CR accepted, evaluateDecide outcome of changeIf outcome is to proceed,create/publish ECNUpdate plan information
312 Configuration Management This page intentionally left blank
313 Management by Stage Gates What is it?Exception Management for the Manager(s) of the Project ManagerReqmts GatheringPre-solicitationSolicitationBidAwardBuildoutProject PlanningCompletionProject ExecutionDo you suppose your (PM) manager will just say “go at it and let me know when you’re done”?
315 Future Value (FV) Find FV of $1 today invested for n years at i%/year Timeline MethodFV1 = PV1 (1 + i)54321$PVi%FV1FV2FV5FV4FV3FV = PV (1 + i)nGeneric Case Equation
316 Present Value (PV)Find PV of $1 today of FV dollars received n years in the future, assuming i%/yearPV = FV x FV(1+i)n (1+i)n=
317 Group WorkUse Timeline Method: How much money will be your return at the end of 5 years with 5% annual interest on a deposit of $500How would the situation change if you had a second investment of $250 in the third year? How would the formulaic calculation change?Think of 3 specific examples when you might need to know the concept of PV/FV and how to calculate it.
318 Annuity What is it? How is it calculated? A series of equal payments at fixed intervals for aspecified number of periodsE.G. – marketing tells you that Project X, of which you’ll be the PM, will generate $1M per year for 5 years starting at project release in January 2005How is it calculated?FVAn = PMT/(1+i) + PMT/(1+i)2 + … + PMT/(1+i)t= PMT Σ 1/(1+i)tt=1n
319 Annuity Example Why is it important? Promise to pay $1000/year for 3 years. If you were to receive this money and invest it with a 4% return, how much would you have at the end of 3 years?321i%$1000i =t =n =PMT =Are we solving for PV or FV?Answer?Why is it important?Couldn’t we just do an FV analysis on a $5M payback at the end of 5 years in the 5 year, $5M project example?In the example above, what amount of money would you want to receive now to be able to turn down the $1000/year for 3 year deal?
320 Net Present Value (NPV) NPV = Σ (FVt / (1+i)t) - It=1FVt = incremental, after tax net cash flow in year tI = the investment (capital outlay), which is assumed to all happen in year 0)NPV > 0 is good (project or activity may be chosen)
321 Depreciation Paying the equipment Methods Suppose you buy a machine for $100k, use it for 5 years to do “your thing,” and then scrap it. The cost of the work produced by the machine must include a charge for the machine (depreciation).As depreciation increases, net income decreasesUnlike paying the staff, depreciation is NOT a cash charge – cash flows are not decreased…Depreciation actually increases cash flow!!!MethodsStraight LineDouble declining balanceSum of the years’ digitsAccelerated Cost Recovery System (ACRS)Modified Accelerated Cost Recovery System (MACRS)
322 Depreciation Straight Line Method (Purchase Amount – Salvage Value) / Depreciation lifeDepreciation Life determined by the estimated useful life of the assetSalvage Value = value the asset is expected to have at end of depreciation lifeYear 1Year 2Year 3Year 4Purchase ValueSalvage ValueWhat is the effect on cash flow of changing the salvage value?
323 Modified Accelerated Cost Recovery System MACRSSum of purchase price for any year x the depreciation % for that yearDepreciation Life determined by Asset Class rulesClassAsset Type3 yearComputers & research equipment5 yearAutomobiles, tractors, light duty trucks, computers7 yearIndustrial equipment, furniture, fixtures10 yearCertain long-lived equipment27.5 yearResidential rental property31.5 yearNon-residential property
324 MACRS Continued21.5 and 31.5 year class property uses straight line method3, 5, 7, 10 year class property uses accelerated method in table below (or alternative straight line method for very small businesses)Ownership year35710133%20%14%10%245322518151917144121311968
325 MACRS ContinuedHalf-year convention: Assumes property put in service in middle of first year – extends recovery period by one more year (3 year class property is depreciated over 4 years)Depreciable basis: Purchase price + shipping and installation costs [NOTE: NO classes allow salvage value as part of depreciable basis]Salvage Value: Add the difference of (actual sale price – undepreciated value) to normal operating income for taxation at the normal rateE.G. - $100k equipment with 5 year class life sold at end of year 4 for $25k$25,000 – ($100,000( )) = $8000 to add to operating income
326 SL ExampleExcellanz buys a computer for $150k. It requires an additional $15k for delivery and $15k for installation. The company expects to be able to sell the equipment for $25k at the end of the straight line depreciable life.What is the depreciable basis?What is the depreciation for each year and the total depreciation?
327 Baselines What is a baseline? When are the “snapshots” taken? “snapshot” of project schedule, cost (budget), or scopeWhen are the “snapshots” taken?When the plan (schedule, scope (budget), scope) is considered feasible technically and in terms of resourcesHow are they used?Used as the basis for measuring and reporting actual performance against the plan (schedule, cost, scope)Used to manage project changes to scope, schedule, cost (i.e. – get rid of the “creep”)
328 Earned Value Earned Value Management Performance measurement system: A methodology used to measure & communicate the real, physical progress of a project.Integrates scope, cost, & schedule measures:Takes work complete, time taken, and costs incurred to complete that work into account.Useful as a risk management monitoring toolEV helps evaluate & control project risk by measuring project progress using a standard measure (monetary terms).
329 Earned Value Earned Value Management How it works: We plan how we will accomplish a task(s)How long it will takeResources requiredEstimated costsWe spend time and materials in completing a task.If we are efficient, we complete task with time to spare & minimum wasted materials.If we are inefficient, we take longer than planned and waste materials.Take a snapshot of the project and calculate EV metrics to:Compare planned vs actual and use that to make a subjective assessment of progressExtrapolate the information to estimate future costs & probable completion date
330 Earned Value Planned Value (PV – aka BCWS) Actual Cost (AC – aka ACWP) Budgets for each activity planned (Portion of cost estimate planned to be spent on an activity during a given period)Actual Cost (AC – aka ACWP)Real, Total cost incurred during work on an activity during a given periodMust correspond to budgeted value for the PV and EVEarned Value (EV – aka BCWP)Value of work actually completed (The planned costs of the work allocated to the completed activities)Cost Variance (CV) = EV – ACSchedule Variance (SV) = EV – PVCost Performance Index (CPI) = EV/AC (CPI < 1 is bad)Schedule Performance Index (SPI) = EV/PV (SPI < 1 is bad)Estimate at Completion (EAC) = ACWP + ((BAC-BWCP)/CPI)
331 Communications During Execution You’re having a problem on your project –when do you tell the stakeholders?You’re *not* having a problem on your project –Is there such a thing as overcommunication?An example of the communication balance
332 Communications During Execution From: Eiler, Timothy Sent: Wednesday, August 31, :27 AM To: Bob Jones (contractor)Subject: CommunicationBob,When a customer-affecting release does not go as planned, you need to call the appropriate Account Manager to let her know that it failed, even if you don't yet know why that happened. They need to know so that they can decide what communication is needed with the customer's business contacts to smooth feathers, etc. This is particularly critical now as we try to assuage hurt customer feelings so that we can keep relationships with them alive for loan purchases. Depending on the impact scope, of course, you probably don't need to call them seconds after the failure or anything, but they do need to know fairly soon.After you've let them know about the initial failure, as you learn more and have updates to status and correction plans and progress, call them again as judgment dictates.Even if the failure is corrected fairly quickly, you should let them know it occurred so they can be aware of what happened. Essentially, after any customer-affecting release, call them to let them know an executive summary of how it went - success or failure. I'm assuming, given the time of day most releases happen, that they will each want to be called at their desk phones, with you leaving voice mail, but you need to work that out with each of them individually, and probably for individual releases, as well.You also need to call me to let me know of the failure, though I have less need for late night calls about correction plans and progress. I can generally, depending on the impact of the failure, of course, wait until morning to know about correction plans and progress. Calls to my cell, with voice mail left if I don't answer, are what I need.Overall, the goal is to rationally over communicate this information - while not being passive-aggressive, of course. :-)Tim
333 Storytelling for Communication Use of examples – how could I have used an example to help Bob understand and accept?Use of analogies – how could I have used an analogy to help Bob understand and accept?Other ways storytelling can be an aid
334 Typical Project Documents Dunning LetterA memo identifying specific things done wrong/currently late/etc and the ramifications of continuing to fail to address the issuesTransmittalA memo that outlines/explains submittals included with the transmittal and the actions required by the recipient
335 Managing Iterate! Is the plan right? Are things going as they should? If not, how far off are we?Does it need changes?What do we need to do to be where we need to be?What changes or corrections are needed?When do the changes need to be made?Who on the project team needs to make “course corrections” in order to achieve the plan?Iterate!
337 Managing Project Teams “Design team failure is usually due to failed team dynamics.”(Leifer, Koseff & Lenshow, 1995).“It’s the soft stuff that’s hard; the hard stuff is easy.”(Doug Wilde, quoted in Leifer, 1997)In order to make sense out of leading project teams, you need to understandthe concept of “team,”the concept of “lead,” andthe concept of “manage.”
338 Seven Habits Of Highly Effective People Be Pro-Active: Take initiative & the responsibility to make things happen.Begin With an End in Mind: Start with a clear destination to understand where you are now, where you're going, & what you value most.Put First Things First: Manage yourself. Organize & execute around priorities.Think Win/Win: See life as a cooperative, not a competitive arena where success is not achieved at the expense or exclusion of the success of others.Seek First to Understand: Understand then be understood to build the skills of empathic listening that inspires openness and trust.Synergize: Apply the principles of cooperative creativity and value differences.Renewal: Preserving and enhancing your greatest asset, yourself, by renewing the physical, spiritual, mental and social/emotional dimensions of your nature.Steven Covey, 1989
339 Managing Project Teams A team is a small number of people with complementary skills who are committed to a common purpose, performance goals, and approach for which they hold themselves mutually accountable• SMALL NUMBER• COMPLEMENTARY SKILLS• COMMON PURPOSE & PERFORMANCE GOALS• COMMON APPROACH• MUTUAL ACCOUNTABILITY (to project, to team, to each other)--Katzenbach & Smith (1993) The Wisdom of Teams
340 Leadership vs Management Is there a difference?Hey!!! Wrong Forest!!!
341 Leadership vs Management LEADERSHIP FUNCTIONSAssessing Organizational PerformanceAligning Organizational Practices with Values & VisionAltering Organizational Practices & StandardsInitiating Organizational ImprovementsFacilitating Quality InteractionsIntegrating Organizational Systems & ProcessesEducating for Quality PerformanceMANAGEMENT FUNCTIONSTracking Operational PerformanceAligning Operations with Customers' ValuesMaintaining Operational Practices & StandardsImplementing Operational Plans & ProjectsSolving Operational ProblemsProcuring Operational ResourcesAccounting for Resource Performance
343 Managing Project Teams Six Basic Principles of Team DisciplineHave and develop a common purposeKeep team membership smallEnsure team members have complementary skillsSet common goalsEstablish agreed-upon ground-rules and approachIntegrate team and individual accountabilityKatzenbach & Smith (2001) The Discipline of Teams
344 Leading Project TeamsLeadership is any action that helps a group achieve its goals AND maintain cooperative relationships among members of the group.List as many characteristics in 2 minutes that come to find for followers you admireList as many characteristics in 2 minutes that come to mind for followers you admire
345 New Leadership Competencies 1. Ability to think in terms of systems & knowing how to lead systems.2. Ability to understand the variability of work in planning & problem solving.3. Understanding how people learn, develop, & improve; leading true learning and improvement.4. Understanding people & why they behave as they do.5. Understanding the interaction & interdependence between systems, variability, learning, and human behavior; knowing how each affects the others.6. Giving vision, meaning, direction, & focus to the organization.The Leader's Handbook (Scholtes, 1998)
346 Ten Commandments of Leadership Challenging the Process1.Search for Opportunities2.Experiment and Take RisksInspiring a Shared Vision3.Envision the Future4.Enlist OthersEnabling Others to Act5.Foster Collaboration6.Strengthen OthersModeling the Way7.Set the Example8.Plan Small WinsEncouraging the Heart9.Recognize Individual Contribution10.Celebrate Accomplishments(Kouzes & Posner, 1987)
347 8 Crucial Elements of System Leadership Quality information must be used for improvement, not to judge or control peopleAuthority must be equal to responsibilityThere must be rewards for resultsCooperation, not competition, must be the basis for working togetherEmployees must have secure jobsThere must be a climate of fairnessCompensation should be equitableEmployees should have an ownership stake
348 Managing Project Teams What’s involved in managing teams?What are the obstacles a PM must overcome to create and manage a successful project team?
349 Managing Project Teams Team CharterTeam name, membership, rolesTeam Mission StatementAnticipated results (goals)Specific tactical objectivesGround rules/guide principles for team participationShared expectations/aspirations
350 Managing Project Teams What it takes to be a good project manager (Posner, 1987)Communication Skills (84%)ListeningPersuadingOrganizational skills (75%)PlanningGoal-settingAnalyzingTeam Building Skills (72%)EmpathyMotivationEsprit de CorpsLeadership Skills (68%)Sets ExampleEnergeticVision (big picture)DelegatesPositiveCoping Skills (59%)FlexibilityCreativityPatiencePersistenceTechnological Skills (46%)ExperienceProject KnowledgePercentages represent the percentage of respondents to a Posner survey who included the skill in the list of importance
351 Managing Project Teams Skills necessary for effective project managersPlanning• Work breakdown• Project scheduling• Knowledge of PM software• Budgeting and costingOrganizing• Team building• Establishing team structure and reporting assignments• Define team policies, rules and protocolsLeading• Motivation• Conflict management• Interpersonal skills• Appreciation of team members' strengths and weaknesses• Reward systemsControlling• Project review techniques• Meeting skillsPinto and Kharbanda (1995):
352 Characteristics of Admired Leaders 1Characteristic1993 U.S.Percentage ofPeople Selecting1987 U.S.Honest8783Forward-looking7162Inspiring6858Competent67Fair-minded4940Supportive4632Broad-minded4137Intelligent3843Straightforward34Courageous3327DependableCooperative3025Imaginative28Caring26Mature1423Determined1320Ambitious1021LoyalSelf-controlled5IndependentJames M. Kouzes & Barry Z. Posner Credibility: How leaders gain and lose it, why people demand it. San Francisco: Jossey-Bass.
353 Managing Project Teams Group Task and Maintenance RolesGroup Task RolesGroup Maintenance RolesInitiatingEncouragingSeeking InformationExpressing FeelingsGiving InformationHarmonizingSeeking OpinionsCompromisingGiving OpinionsFacilitating CommunicationsClarifyingSetting Standards or GoalsElaboratingTesting AgreementSummarizingFollowing
354 Managing Project Teams Five Top Criteria of a Competent Project ManagerThey have enthusiasmThey have high tolerance for ambiguityThey possess high coalition and team-building skillsThey have client-customer orientationThey have a business orientationGraham, Robert J. & Englund, Randall LCreating an environment for successful projects.San Francisco: Jossey-Bass
355 Power Tools Situational!! 5 Types of Power for Leaders and Managers People do what you ask because…FormalOrganization tells them toExpertYou are perceived as an expert in “x”ReferentThey like or trust youRewardYou can give them something in returnCoerciveYou can take something from them/hurt themSituational!!
356 Keys For PM Success•Communicate regularly in person with key team members•Keep management informed•Keep informed on all aspects of the project•Delegate tasks to team members•Listen to input from team members•Be able to take criticism•Respond to and/or act on suggestions for improvement•Develop contingency plans•Address problems•Make decisions•Learn from past experience•Run an effective meeting•Set up and manage the project file•Use project management tools to generate reports•Understand trade-offs involving schedule and budget•Have a sense of humor--Lientz and Rea (1996)
357 Meetings and More Meetings “I used to think, ‘oh no, not another meeting’ until I worked for you.”- A former employee of minePeople hate meetings.People think meetings are a waste of time -The sad part is that most of them areYou will spend a good portion of your work in meetings. Fool people – make them gain respect for you by making your meetings anEFFECTIVE use of their time
358 Meetings and More Meetings Some reasons that people think badly of meetings:Purpose is unclearParticipants are unpreparedKey people are absent or missingThe conversation veers off trackParticipants don’t discuss issue but insteaddominate, argue, or take no part at allMeeting decisions not followed up
359 Guidelines for Holding Meetings Hold meetings for group decision makingavoid weekly progress report meetingsIf meeting is held to address a specific issue, restrict meeting to this issue aloneEnsure everyone properly preparedDistribute written agenda in advance of meetingTell where and whenState and repeat the objective of the meetingAvoid excessive formalityChair and participants controlMeeting – use groundrules
360 Meetings – The Right Way BEFOREPlan: Clarify meeting purpose & outcome, Identify meeting participants, Select methods to achieve purpose, Develop & distribute agenda, Set up roomDURINGStart: Check-in, Review agenda, Set/review ground rules, Clarify rolesConduct: Cover one item at a time, Manage discussions,Maintain focus & paceClose: Summarize decisions, Review action items, Solicit agenda items for next meeting, Review time & place for next meeting, Evaluate the meeting, Thank participantsAFTERFollow-up: Distribute or post meeting notes promptly, File agendas, notes, & other documents, Do and/or check up on action items/assignments.
361 Meetings – The Right Way Five Meeting RolesChairRecorderTimekeeperPresenterParticipantNO ONE SHOULD PLAY MORE THAN 2 ROLES AT ONCE!!!!!
362 Meetings and More Meetings Virtual PM – what’s different?Virtual Project TeamsUse of the Technology to meetUse of Software ProgramsHow does the new situation change PM processes?
363 GroupthinkGroups without conflict where there is a strong norm of “Concurrence Seeking”
364 Avoiding Groupthink 1. Know the Symptoms of Groupthink Overestimation of the GroupIllusion of invulnerabilityBelief in group moralityClosed MindednessRationalizationStereotyping OutgroupsPressures Toward UniformitySelf-censorshipDirect pressureMindguardsIllusion of unanimity
365 Avoiding Groupthink 2. Strategies for avoiding Groupthink Promote an open climateAvoid the isolation of the teamAppoint critical evaluatorsAvoid being too directive
366 ControversyControversy exists when one person’s ideas, information, conclusions, theories, and opinions are incompatible with those of another person and the two seek to reach an agreement.
367 Vernon Felton, Frame of Mind -- Bike, 8 (4), May 2001 Controversy“. . . Controversy is a great thing. Unfortunately, controversy gets a bad rap. Most people scurry about their lives trying to avoid controversy, avoiding disagreements with others, avoiding messy debates. . .Our world is awash in controversy. And rightly so. . . We need it. We need to discuss controversial subjects. We need to settle differences of opinion. . . Acknowledging and resolving issues that divide us is a good thing. It’s what separates us from the apes. . . “Vernon Felton, Frame of Mind -- Bike, 8 (4), May 2001
368 Managing Conflict“The work life of a project manager is a life of conflict. Although conflict is not necessarily bad, it is an issue that has to be resolved by the project manager. Without excellent negotiation skills, the project manager has little chance for success.”Taylor, J A survival guide for project managers. AMACON.
369 Mitigating The Bad Effects of Controversy Managing ControversyMitigating The Bad Effects of ControversyCooperative Context• Positive Interdependence – Commitment to a Common Goal• Individual and Group Accountability• Face-to-Face Promotive Interaction• Teamwork Skills• Group ProcessingHeterogeneity Among MembersDistribution of InformationSkilled Disagreement
370 Rules for Constructive Controversy Managing ControversyRules for Constructive ControversyI am critical of ideas, not people. I challenge & refute the ideas of the opposing group, but I do not personally reject them.I remember that we are all in this together, sink or swim. I focus on coming to the best decision possible, not on winning.I encourage everyone to participate & to master all relevant info.I listen to everyone’s ideas, even if I don’t agree.I restate what someone has said if it is not clear.I first try to bring out all the ideas & facts supporting both sides, and then I try to put them together in a way that makes sense.I try to understand all sides of the issue.I change my mind when evidence clearly indicates I should
371 BOEING Code of Cooperation •EVERY member is responsible for the team’s progress and success.•Attend all team meetings and be on time, Come prepared.•Carry out assignments on schedule.•Actively listen to & show respect for contributions of other members•CONSTRUCTIVELY criticize ideas, not persons.•Resolve conflicts constructively,•Pay attention, avoid disruptive behavior like holding side conversations•Only one person speaks at a time.•Everyone participates, no one dominates.•Be succinct, avoid long anecdotes and examples.•No rank in the room.•Respect those not present.•Ask questions when you do not understand.•Attend to your personal needs at any time but minimize team disruption.•HAVE FUN!!•?Adapted from Boeing Aircraft Group Team Member Training Manual
372 FORD Code of Cooperation • Help each other be right, not wrong.• Look for ways to make new ideas work, not for reasons they won't.• If in doubt, check it out! Don't make negative assumptions abouteach other.• Help each other win, and take pride in each other's victories.• Speak positively about each other & your organization at everychance.• Maintain positive mental attitude no matter what the circumstances.• Act with initiative and courage, as if it all depends on you.• Do everything with enthusiasm; it's contagious.• Whatever you want; give it away.• Don't lose faith.• Have fun
373 Strategies for Dealing With Conflict Managing ConflictStrategies for Dealing With ConflictWithdrawing: Neither the goal nor the relationship are important- withdraw from the interaction.Forcing: The task is important but not the relationship- use all your energy to get the task done.Smoothing: The relationship is more important than the task.- work to be liked and accepted.Compromising: Both task & relationship important but thereis lack of time - you both gain and lose something.Confronting: Task & relationship are equally important.- define conflict as a problem-solvingsituation and resolve through negotiation.
374 Managing ConflictWhich strategies do effective team members use? Ineffective team members?Under what conditions are each of these conflict strategies important?What words and phrases are needed to set up each strategy?
375 Blake & Mouton Conflict Model Managing ConflictBlake & Mouton Conflict Model- Importance of the Goal- Importance of theRelationship
376 Heuristics for dealing with conflicts: Managing ConflictHeuristics for dealing with conflicts:Do not withdraw from or ignore the conflict.Do not engage in "win-lose" negotiations.Assess for smoothing.Compromise when time is short.Confront to begin problem-solving negotiations.6. Use your sense of humor.
377 Managing ConflictA confrontation is the direct expression of one's view of the conflict and one's feelings about it while inviting the opposition to do the same. Suggested guidelines for confrontation are:1. No "hit-and-run": confront only when there is time tojointly define the conflict and schedule a negotiating session.2. Openly communicate: express feelings about & perceptions of issues involved in the conflict, & try to do so in minimally threatening ways.3. Seek 1st to understand: accurately & fully comprehend opponent's views of the feelings about the conflict.A successful confrontation sets up opportunity to negotiate.
378 Managing Conflict Skilled Disagreement Define Decision as a mutual problem, not as a win-lose situation.Be critical of ideas, not people (Confirm others' competence while disagreeing with their positions).Separate one's personal worth from others' reactions to one's ideas.Differentiate before trying to integrate.Take others' perspectives before refuting their ideas.Give everyone a fair hearing.7. Follow the canons of rational argument.
379 Escalation of Conflicts – Strategies for Resolving Managing ConflictEscalation of Conflicts – Strategies for ResolvingInformal NegotiationFormal NegotiationMediationThird-Party MediationArbitrationBinding ArbitrationLitigation
380 Managing ConflictNegotiation is a conflict resolution process by which people who want to come to an agreement, but disagree about the way to resolve, try to work out a settlement.
381 Managing Conflict Recommended steps in conflict negotiation: Define the conflict mutually.Communicate feelings and positions.Communicate cooperative intentions.Take the other person's perspective.Coordinate the motivation to negotiate.Reach agreement satisfactory to both sides --SEEK WIN-WIN OR DON’T NEGOTIATE.
382 Negotiating Guidelines 4 Steps in Principled Negotiation Managing ConflictNegotiating Guidelines4 Steps in Principled NegotiationSeparate the people from the problemFocus on interests, not positionsCreate optionsInsist on standardsFisher & Ury - Getting to Yes
385 Health & SafetyJob-related fatalities up in '04John Vomhof Jr. Staff Writer, The Business Journal – 8/25/2005There were 80 fatal work-related injuries recorded in the state in 2004, the Minnesota Department of Labor & Industry reported Thursday. That is up from 72 in 2003, and one less than in The state averaged 74 work-related deaths from 1999 to 2003.In 2004, the agriculture industry recorded the most worker fatalities, with 18; the industry had 19 deaths in 2003 and 21 in Construction had 16 fatalities in 2004, an increase from 10 in 2003 and 15 in Nine government workers were fatally injured in 2004, up from three in 2003, but down from 12 in 2002.Transportation incidents accounted for 29 of the 80 work-related deaths in That compares to 30 in 2003 and 44 in 2002.Contact with objects and equipment led to 18 fatalities in 2004, while assaults and violent acts killed 11. Falls also led to 11 work-related deaths.Women accounted for seven of the 80 people fatally injured on the job in 2004.The Census of Fatal Occupational Injuries is conducted annually by the U.S. Department of Labor's Bureau of Labor Statistics. There were a total of 5,703 fatal work injuries recorded nationwide in 2004.
386 Causes of Constr. Deaths DeathsFalls377Transportation283Contact with Objects, Equipment200Harmful Substances, Environment186Violence32Other29Source : U.S. Department of Labor, Star Tribune 12/3/98
387 Health & SafetyStar Tribune, 12/3/98, Two killed in accident at Piper Site, By Joy PowellTwo electricians were killed at a downtown Minneapolis construction site on 12/2/98, after a 10,000-pound steel column being moved by a crane slipped off its mark and slammed into a beam.That apparently dislodged a storage bin weighing more than a 1,000 pounds that was resting on the beam. The bin, full of nuts and bolts and studs, crashed through eight floors to the ground.Darryl J. Hilgendorf, 49, of Minneapolis, and a second worker whose name wasn’t released died in the 9:20 a.m. accident.They were working on the 6th floor of the Piper Jaffray Center under construction at S. 8th St. and Nicollet Mall when they were either hit by the bin or fell through the hole alongside it.“We’re just sick about this”, said Robert Cutshall, vice president of construction for Ryan Companies, the general contractor. ”We feel terrible, and our hearts go out to the families of these two men killed today”.A Minneapolis building inspector is also expected to tour the site today, and state investigators will continue to look into the case.Workers were building the 8th story of a 30 story tower. They had laid decking, sheets of corrugated steel 1/16th of an inch thick, that will have concrete poured on them to make floors.
388 Health & SafetyHistory: Other Construction Fatalities in the Twin CitiesJune 1992, Minnesota Zoo: A worker on the zoo’s amphitheater was fatally injured when a 400-pound fixture holding 8 bird cages fell on him.May 1991, Mall of America: One man died and another was injured when scaffolding they were on collapsed.April 1991, Mall of America: One man died and two other workers were injured when concrete flooring collapsed in a mall parking garage.April 1990, Lake St. Marshall Av. bridge: A worker fell 90 feet to his death when a concrete arch span of the new bridge collapsed into the Mississippi river.April 1990, Minneapolis Veterans Medical Center: A construction worker was killed when a section of crane he was helping dismantle collapsed on himOctober 1989, Cray Research, Inc.: A fall from a scaffold killed a worker at the Eagan site of a Cray building.Star Tribune 12/3/98, by Linda Scheimann and James Walsh
389 Health & Safety Workers – 100,000s Deaths – 100s Death rate – per 100,000 workersDisabling injury rate – per 1,000 workers
390 Health & SafetyWhat responsibilities do engineers and PMs have for health and safety?What can PMs do to minimize risks and make the workplace safer?
391 Ethics Outline What is ethics? Why do we care about ethics? Definition FundamentalsCodes of ethicsWhy do we care about ethics?
392 What Is Ethics??Ethics provide a systematized framework for making decisions where values conflict
393 Differentiating the Confusion Ethical – decision-making in a systemic manner that conforms to accepted professional standards of conductMoral – decision-making based on principles of right and wrong behaviorLegal – decision-making conforming to rules of the lawSource: WWWebster Dictionary
394 Why Is Ethical Behavior Important?? Trust is defined as “certainty based on past experience”…. ethics concerns concepts of the individual or group by which actions are judged “right” or “wrong.” Source: J Campbell MartinSystems of ethics are used to guide our decision-making and behavior in human-to-human relationships
395 Systems of Ethics There are many systems of ethics The two major theories:Decisions are made on the basis of the consequences of an act or decisionDecisions are made on the basis of the morality of acts (is act right or wrong?)
396 Ethics – What Guides Your Choices? Is the commonly made decision always the right one ?Is the legal decision always the morally right decision?Is the morally right decision always the one in your best interest?Is the morally right decision always the most economical?Is following orders that are not proper a legal or a moral defense?
397 Fundamentals – Moral Development Attributed to KohlbergPreconventional level - Moral behavior or actions are judged by the person the behavior or actions benefits. e.g. to a child taking a toy from another child is moral (ethical.)Behavior can be modified by desire to avoid punishment or to seek approval.
398 Fundamentals – Moral Development Conventional level - behavior is based on the norms of the family, group or society that are accepted. Most adults do not go beyond this level.Postconventional level - At this level the individual is autonomous and can ask “what is best?” Individuals are guided by integrity, self respect and respect for others.
399 Utility Theory Attributed to Mill Balance between good and bad consequences.Utilitarianism - acts should always maximize utility.
400 Duty Theory Attributed to Kant Duties - honesty, fairness, commitment, gratitude,Dutiesshow respect for others,express moral imperatives, andare universal.
401 Human Rights Theory Attributed to Kant. Duties exist because of the rights of others.Rights are tolife,liberty, andproperty gained by one’s labor.
402 Virtues Theory Attributed to Aristotle Moral virtues represent a balance between extremes between excess and deficiency in conduct, emotion, desire and attitude.
403 Ethics – The DilemmaA dilemma is a choice between two (or more) options that are fundamentally opposed and which carry generally equal weight.“Engineers are always confronted with two ideals, efficiency and economy, and the world’s best computer could not tell them how to reconcile the two. There is never ‘one best way.’ Like doctors or politicians or poets, engineers face a vast array of choices every time they begin work, and every design is subject to criticism and compromise.”Source: Billington, D.P., 1986, “In defense of engineers,”The Wilson Quarterly, January.
404 “Treat others as you would want them to treat you” Ethics in Practice“Treat others as you would want them to treat you”Engineering ethics is important ininterpersonal relationshipsdeveloping products and facilitiesimpacting future generations......
405 Ethics in PracticeIf a builder builds a house for man and does not make its construction firm andthe house collapses and causes the death of the owner of the house - that builder shall be put to death.it destroys property, he shall restore whatever is destroyed, and because he did not make the house firm he shall rebuild the house which collapsed at his own expense.If a builder builds a house for a man and does not make its construction meet the requirement and a wall falls - that builder shall strengthen the wall at his own expense.The Code of Hammurabi (2250 BCE)
406 University of MN Honor Code I recognize academic integrity as essential to the University of Minnesota’s and its students’ equitable and uncompromised pursuit of their joint endeavors.As a student I promise to practice it to the best of my ability and to do nothing that would give me unfair advantage at the expense of my fellow students.If I cheat in spite of making this declaration, I expect to be penalized according to the offense, up to and including notation of cheating recorded on my transcript and permanent expulsion from the University of Minnesota.(accessed 4/25/00)
407 Our Ethical Values (Lockheed-Martin) HONESTY: to be truthful in all our endeavors; to be honest and forthright with one another and with our customers, communities, suppliers and shareholders.INTEGRITY: to say what we mean, to deliver what we promise, and to stand for what is right.RESPECT: to treat one another with dignity and fairness, appreciating the diversity of our workforce and the uniqueness of each individual.TRUST: to build confidence through teamwork and open, candid communication.RESPONSIBILITY: to speak up – without fear of retribution – and report concerns in the work place, including violations of laws, regulations and company policies, and seek clarification and guidance whenever there is doubt.CITIZENSHIP: to obey all the laws of the United States and the foreign countries in which we do business and to do our part to make the communities in which we live a better place to be.
408 PM EthicsPreamble: In the pursuit of the PM profession, it is vital that PMI members conduct their work in an ethical manner in order to earn & maintain the confidence of team members, colleagues, employees, employers, clients, the public, & the global communityMember Code of Ethics: As a professional in the field of PM, I pledge to uphold and abide by the following:I will maintain high standards of integrity & professional conductI will accept responsibility for my actionsI will continually seek to enhance my professional capabilitiesI will practice with fairness & honestyI will encourage others in the profession to act in an ethical & professional mannerProject Management Institute
409 Engineering EthicsEngineers, in the fulfillment of their professional duties, shall:Hold paramount the safety, health and welfare of the public.Perform services only in areas of their competence.Issue public statements only in an objective and truthful manner.Act for each employer or client as faithful agents or trustees.Avoid deceptive acts.Conduct themselves honorably, responsibly, ethically, and lawfully so as to enhance the honor, reputation, and usefulness of the profession.National Society of Professional Engineers (NSPE)
410 Ethical Decision Evaluation Possible ProcessProblem DefinitionIdentify ethical issuesDetermine relevant factsIdentify/Gather required missing dataDetermine relevant ethical principlesDiscuss practical constraintsIdentify possible solutionsSeek ways to avoid the original problemList action itemsMake preliminary judgments (apply evaluation tests)Review decisions and synthesize discussion into a solution
412 Ethics Evaluation Tests Harm Test: Does this option do less harm?Publicity Test: Would I want my choice to appear in the newspaper next to my name?Mother Test: What if my mom knew about the choice I made?Defensibility Test: Could I defend my choice before a committee of my peers (or others)?Reversibility Test: Would I think the choice was good if I were the one affected by it?Colleague Test: What do my colleagues say when I describe the problem and my solution?Professional/Organizational Test: What might ASCE (IIE, IEEE, ASME, etc) say about my choice?
413 Ethics EvaluationTests Is it honorable (would you hide this action from anyone)?Is it honest (does it betray a trust)?Does it fall within your area of competence?Does it avoid a conflict of interest (will your judgment be biased)?Is it fair (does it violate the legitimate interests of others)?Is it considerate (does it violate privacy or confidentiality)?Is it conservative (in terms of time and resources required)?
414 You're sitting across from a peer of yours, who is also a good friend on a professional level, who you know is trying to get a small business up and running "on the side." You already have recognized that he is, frankly, not the highest performer. Over the past several weeks, you have also noticed that he is doing things for his business while at work. Today, you notice that he has been holding a phone call with someone about his side business (not chatting, but actually conducting business) and that call is now just into the start of the second hour.What do you do?
415 Politely refuse to accept the gift. You are attending a conference in the U.S. as a representative of your company. A supplier passes out a small electronic gadget, valued at about $40, to everyone at the meeting. What do you do?Accept the thoughtful gesture – since the gift is valued under $50, there is no need to report it.Accept the gift, but be sure and report it to your manager. If your manager tells you to return it, you are required to comply.Accept the gift, if declining puts you or the company in a awkward position. Then, immediately consult the Ethics Office for disposition.Politely refuse to accept the gift.(Ethics Challenge -- Case 6)
416 Do nothing. It’s the manager’s decision to make. You work in Quality Assurance. You rejected some parts as non-conforming to specifications, but your manager told you to accept the part “As Is.” You don’t agree with the decision. What do you do?Do nothing. It’s the manager’s decision to make.Discuss it with your manager.Call the Ethics HelpLine.Ask the engineers who are responsible for the specification to clarify the situation.(Ethics Challenge -- Case 18)
417 Tell the employees to just do their work & mind their own business. Employees in the department have noticed that your supervisor spends a good portion of his day doing homework for a company-sponsored college course. He also spends a significant amount of time making phone calls that they suspect are personal, and may be made a company expense. What should you do?Tell the employees to just do their work & mind their own business.Tell the employees that you don’t want to risk your job by becoming involved.Suggest that your fellow employees contact the Ethics Officer or another company official.Raise the issue directly with your supervisor.(Ethics Challenge -- Case 24)
418 Put the word out to your fellow workers as to who really did the work. In a department meeting, your supervisor takes credit for some excellent work done by an absent colleague. What do you do?Put the word out to your fellow workers as to who really did the work.Seek a private meeting with the supervisor in order to make sure your colleague gets proper credit.During an informal conversation with “the big boss,” casually let it slip that your colleague did not get the credit he deserved on a recent project.Inform your colleague as to what took place, and let him take whatever action he desires.(Ethics Challenge -- Case 29)
419 Contact the injured co-worker and offer to testify on her behalf. A co-worker is injured on the job. You are a witness and what you saw reflects poorly on the company. What do you do?Don’t get involvedContact the injured co-worker and offer to testify on her behalf.Report what you saw to the company.Protect the company by refusing to testify as a witness for the injured person.(Ethics Challenge -- Case 30)
420 Nothing, since no one has complained. When a particular male supervisor talks to any female employee, he always addresses her as “Sweetie.” You have overheard him use this term several times. As the supervisor’s manager, what should you do?Nothing, since no one has complained.Talk to the supervisor and explain that, while he may have only good intentions, his use of “Sweetie” could be offensive to employees and must stop.Order the supervisor to call an all-hands meeting to discuss the company policy on sexual harassment.At the next staff meeting, remind all supervisors of their obligation to maintain a professional work environment, free of discrimination or harassment of any kind.(Ethics Challenge -- Case 42)
421 If a deal sounds too good to be true, it probably is. You work in Production Control. You plan to add a porch to your house, and you visit a lumberyard to get ideas and a price. During the discussion, the sales manager says, “Oh, you work for the XYZ company. They buy a lot from us, so I’m going to give you a special discount.” What do you do?Like finding a $20 bill on the street, take the discount. When you get back to the office on Monday, ask the supervisor if all employees were eligible for the discount.Say “I work for a different division of the XYZ Company – am I still eligible for the discount?”Ask for clarification – “Is that special discount available to all XYZ employees?”If a deal sounds too good to be true, it probably is.(Ethics Challenge -- Case 44)
422 A subordinate (direct report) on one of your projects has trouble getting along with others. What do you do?Don’t get involved.Confront the worker, indicating what needs to change, how it needs to change, how you will monitor for improvement, and working with the employee to come up with solutions, etc.Report what you saw to your manager.Protect the company by documenting the problem.
423 Review the paper, provide objective comments and return it promptly. As a senior research scientist, you receive a research paper for peer review. The paper essentially duplicates research you are writing for publication. If this paper is published before your paper you will be “scooped” in the profession. Christmas holidays are coming – and you had planned to use the free time to complete your paper and submit it for open literature review. Reviewing the competing paper will take valuable time, and allowing it to be published first will drastically affect your career. What do you do?Without reading the paper, and knowing its contents could affect your conclusions, you return the manuscript to the journal editor, explaining your situation. Then you quickly finalize your paper and submit it.Let Christmas holidays “conveniently” delay the review, then provide negative review comments, knowing that this will delay publication.With the editor’s permission, contact the other author to see if you might combine efforts and produce an even better paper.Review the paper, provide objective comments and return it promptly.(Ethics Challenge -- Case 47)
424 Ethics SummaryAs an engineer, you have a duty to protect the safety of workers and the publicAs an engineer, you also have a duty to respect the interests/desires of your employer or clientAt times, these two goals may be at oddsHaving a basis on which to evaluate the ethics of decisions is extremely important
425 Project Closure Also known as: Project TerminationProject Administrative ClosureProject FeedbackProject AuditWhy should this be a formal, pre-planned activity rather than just an ad hoc, deal with it as it happens situation?
427 Project Closure Verify product/service output Does/Did it do everything you said it would?As judged by the CUSTOMERPartly objective judgment based on hard metricsIs the customer satisfied?Partly subjective judgmentWhat might make customer dissatisfied even though the objective evidence says it was good?
428 Project Closure - Financial Closeout financial system“Collect” revenueWhat do you do if revenue is to be paid you over a time period?Pay final billsHow do you “close out” a long term bill?Complete cost recordsWhat records?How does organization structure affect how this is handled?
429 Project Closure – Post Mortem Gather lessons learnedSometimes called “post mortem”Analyze what went right and what went wrong on projectAnalyze what would have been done differently in hindsightQuite a few companies fail to do this at allMost companies try to do this in one meeting at the endBest practice:Plan for “interim” evaluation along the wayHave the meetings necessary to evaluate outcomeGet information via “non meetings” also
430 Project Closure - Archiving Update and Archive recordsFinalize project recordsPut all files, letters, correspondence, and other records of the project into an ORGANIZED fileEnsure the organized file is in a place that is accessible by the appropriate people for future projectsHow would you protect the records for future use?Update skill set information for resources
431 Project Closure Complete final project performance reporting Analyze, document, and report success and effectiveness of project
432 Project Closure Closure results/outputs? Project Closure/Formal Acceptance“Last minute” documents to customerAs BuiltsManualsA formal document of acceptanceLessons Learned DocumentsProject ArchivesReleased ResourcesFinal resources need formal leave from the projectThe PM can check out but can never leave
433 Project Management Office Project Management Office (PMO)Not very standard in objective/workMay be responsible for providing support functions (project coordination, other admin functions), to providing “process ownership” and training, to actually being responsible for project resultsSometimes known by other namesProject Management Process GroupProject Management Center Of ExcellenceProgram Management OfficeCentral Concept - InnovationDominant Project Characteristics - Overlapping, Fewer boundariesMain Thrust - Modifying and Adapting DemandsMetaphor - DesigningMeans - Creativity, Higher Technology Ability
434 PM Miscellaneous - PMIProject Management Institute (PMI) and Various Engineering Discipline InstitutesValuable education and extra insightHelp make you that extra bit competitiveBenchmarking opportunityNetworking, Networking, Networking
435 PM Miscellaneous - PMMM Project Management Maturity Model (PMMM)Organizations with a solid project management infrastructure achieve an average of 20 % improvements in productivity, customer satisfaction, cost reductions, & ROI.From "The Value of Project Management in Organizations," a report based on research conducted by Project Management Solutions Inc. & The Center for Business Practices
436 PM Miscellaneous - PMMM Project Management Maturity Model (PMMM)Progressive development of an enterprise-wide project management approach, methodology, strategy, and decision-making process. Appropriate level of maturity will vary by organization based on specific goals, strategies, resource capabilities, scope, needs, etc.Maturity to which an organization should strive is determined during a detailed assessment conducted by a professional PM consulting team. The organization has achieved full project management maturity when it has met the requirements and standards for project management effectiveness as defined by the Project Management Maturity Model and can demonstrate improvements like organizational efficiency, on-time project delivery, cost control/controlled cost reductions, and profitability.
438 My PM Words To Live By Learn how your business works! How the business makes moneyHow what you do contributes to making moneyHow you can do things better to make moneyHow you can avoid doing things that will hurt other parts of the business’ ability to make money
439 My PM Words To Live ByIn order to win the game, you must score more than your opponent.Knowing that even the best athlete only scores a certain percentage of the times s/he makes an attempt, to increase the number of points s/he scores, s/he must take more shots and/or improve her/his skills. Those are the only choices available.A new player, particularly one without a great deal of natural talent, can improve his/her percent of shots scored to shots taken through diligent practice. Practice with the help of an experienced coach can increase the percentage even further.There comes a point where the athlete will score fewer and fewer additional points for every hour spent practicing (the law of diminishing returns). Her/his gains from learning fall off more and more drastically. That doesn’t mean the athlete should stop practicing! It only means s/he needs to find another way of increasing the chances of scoring.Short of cheating or only playing against drastically inferior opponents, the sole, honest remaining other way to score more is to make more attempts!
440 My PM Words To Live By Be honest, always Be straightforward, always Don’t be afraid to admit you’re wrongTake your work seriously, not yourselfDon’t let your fears get in the way of progressLearn to understand and be proficient at politicsRemember *everyone* on your team – even a small, innocuous thing like a piece of foam can destroy a complex machine like the space shuttle