1. 1 The Project Management Context (Chapter 2 and more)

2. In mature project-oriented organizations, project management may occur in the larger context of portfolio and program management A program is a group of related projects whose management is coordinated to ensure benefits that may not be attainable if the projects are managed separately A portfolio is a collection of projects or programs – perhaps related, but not necessarily – grouped together to facilitate their management for strategic benefit Projects – The Larger Context 2

3. Projects are frequently used to help achieve strategic objectives for an organization Strategic drivers for such projects could include: Market demands New market opportunities Business needs Customer requests Competitive-enabling development projects Legal and regulatory requirements Projects and Strategic Planning

4. Projects – The Larger Context Summarized Portfolios Programs Projects Organizational Context Strategic Tactical Projects within a program are typically interrelated through common outcomes or capabilities Programs and projects within a portfolio are typically focused on common strategies and loosely related by shared clients, sellers, technologies, or resources Projects deliver discrete benefits, but if included within programs or portfolios, they also contribute to program benefits or to the business objectives of a portfolio 4

5. Projects and Organizational Strategy Strategic management – the science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives. Consists of: Developing vision and mission statements Formulating, implementing and evaluating Making cross functional decisions Achieving objectives 02-05

6. Relationship of Strategic Elements Mission Objectives Strategy GoalsPrograms Figure 2.2 02-06

7. 02-07 “… the business of supplying system components to a world- wide nonresidential air conditioner market.” Mission Objectives a.14.5% ROI b.Non-decreasing dividends c.Socially-conscious image Strategies a.Existing products in existing markets with image maintenance b.Existing products in new markets (foreign, restricted) c.New products in existing markets (significantly improve image) Goals Year 1: 8% ROI, $1 dividend, maintain image, unit cost down 5% Year 2: 9% ROI, $1 dividend, improve image Year 3: 12% ROI, $1 dividend, improve image Year 4: 14% ROI, $1.10 dividend Programs 1. Product Cost Improvement Program (PCIP) 2. Image Assessment Program (IAP) 3. Product Redesign Program (PRP) 4. Product Development Program (PDP) FIGURE 2.3 Illustrating Alignment Between Strategic Elements and Projects Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall

8. 8 A project life cycle is a set of phases that are generally employed sequentially to complete the project work We say these are generally done sequentially, but there are no hard and fast rules about that, and phases sometimes overlap a bit Whether or not this occurs is a function of several factors, including the organizational culture, the tightness of the project schedule, and nature of the work that the project involves In any case, the life cycle provides the basic framework for managing the project The Project Management Life Cycle

9. 9 Though the particulars may vary from organization to organization, every life cycle will include four basic phases (though the names may be different): The first phase focuses on getting the project started – the main output of this phase is the Project Charter The second phase is concerned with getting organized for the project work – the main output of this phase is the Project Plan The third phase in our generic project life cycle model involves carrying out the project work – the main output of this phase is the completed project In the fourth and final phase, the project is formally closed once the work is completed and accepted The Project Management Life Cycle (cont’d)

10. 10 The use of the term “phase” can be confusing in project management It is very important to note, as we remarked earlier, that the five major process groups we defined earlier are not phases Phases are generally done sequentially But remember that the process groups are not sequential, and in fact as we saw, the three process groups of planning, executing, and controlling/monitoring are inherently iterative Phases and Process Groups

11. 11 Another way that the term “phase” can be confusing is the way it is commonly used to describe extending a project’s work well beyond the original deadline This can happen when a project breaks into a sequence of what we mislabel as “phases” when the original project’s scope is reduced by mutual consent … Phase 1 then afterwards Phase 2 etc. The original project is completed and closed although with less than the planned functionality, and the missing functionality is added on as additional work in later phases Precisely speaking, we are in effect creating a new project whose requirements focus on the missing functionality This second project has its own internal set of phases (and process groups) and should be managed as a separate project to obtain optimum benefits More on Project Phases

12. 12 The term “life cycle” can also lead to confusion We need to make a clear distinction between the project life cycle and the product life cycle for building an underlying project deliverable The project life cycle provides a structure for doing all the project work – only one component of which is building the deliverable The product life cycle provides structure and an approach for doing the focused work to build the relevant product Project Life Cycle and Product Life Cycle

13. 13 The software life cycle and associated methodology set standards for the phases and deliverables associated with the software product itself But there are other tasks that must be managed well to enable the software production work These enabling and facilitating tasks are the main focus of project management The project management life cycle provides the framework for the software development and all these other tasks Project Life Cycle and Product Life Cycle (cont’d)

14. 14 One way to think about this is to view the project management life cycle as an umbrella work structure over the software development life cycle These two life cycles must be smoothly integrated for optimal success Project Management and System Development Project Management Life Cycle System Development Life Cycle

15. Project Stakeholders

16. Stakeholder Management Stakeholders are all individuals or groups who have an active stake in the project and can potentially impact, either positively or negatively, its development. Sets of project stakeholders include: Internal Stakeholders Top management Accountant Other functional managers Project team members External Stakeholders Clients Competitors Suppliers Environmental, political, consumer, and other intervener groups 02-016

17. Project Stakeholder Relationships Figure 2.4 02-017

18. Managing Stakeholders 1.Assess the environment 2.Identify the goals of the principal actors 3.Assess your own capabilities 4.Define the problem 5.Develop solutions 6.Test and refine the solutions 02-18

19. Project Stakeholder Management Cycle 2. Gather information on stakeholders 7. Implement stakeholder management strategy 4. Determine stakeholder strengths and weaknesses 5. Identify stakeholder strategy 6. Predict stakeholder behavior 3. Identify stakeholders’ mission 1. Identify Stakeholders Figure 2.5 02-19

20. 20 Customers are the persons or organizations that will use the deliverables of the project – whether a product or service Customers and users could be internal to the organization or external to it, and there may in fact be several layers of customers and users Sometimes customers and users are the same, but often they are not For example, your customer likely has customers, and these second tier customers may be the primary users of the product or service you’re delivering Similarly there could be customers of those customers, and so on Customers and Users

21. 21 Research studies show that customer/user involvement is one of the primary project success factors Requirements typically reside in the customer’s mind and must be coaxed out and articulated It may not always be possible to involve all levels of customers in the project planning But it is always important to try to understand what they will expect of the project deliverables Their acceptance, or their lack of acceptance, of the end result is the deciding factor for the success of your project Involving Customers and Users

22. 22 A sponsor is the person or organization who pays for the project Hence the project sponsor will likely have direct influence on the project The sponsor typically plays an important, even crucial, role at the beginning of the project in helping define its objectives and its scope The sponsor is also likely to play a major role in approving or disapproving the inevitable changes as the project proceeds Project Sponsors

23. 23 Recall that many projects are not undertaken as standalone efforts Many are positioned within programs, collections of inter- related projects, or portfolios, collections of projects grouped to facilitate their management for some strategic benefit In either of these cases, the appropriate program and/or portfolio managers will be important stakeholders, providing both guidance and constraints for your project Program and Portfolio Managers

24. 24 Recall that a PMO (or Project Management Office) is an organization or entity that has certain responsibilities related to the management of projects within its scope A PMO will be a stakeholder if it has direct or indirect responsibility for the outcome of our project Project Management Offices

25. 25 The project team comprises an important stakeholder This group of individuals is responsible for the project work, but not necessarily directly involved in the management of the project Because the project team will know the project work better than any other group, the wise project manager will consult often with the team to manage other stakeholders’ requests and attempts to influence the project Project Team as Stakeholder

26. 26 Functional managers are key stakeholders who control human resources, finances, and procurement, etc. Clearly, the project manger must work closely and effectively with this group to achieve success Operations mangers are individuals who have the management responsibility for ongoing operations The operations managers responsible for the ongoing maintenance and service associated with your project’s deliverables are important project stakeholders Early consultation with operational managers can save a lot of pain later on Functional and Operational Managers

27. 27 Vendors, suppliers, and subcontractors are external organizations that the project may depend on for vitally important resources External business partners may be involved in the marketing, financing, and certification of the project External groups may be needed for specialized expertise in the performance of the project work All these external entities are potentially important stakeholders External Stakeholders

28. 28 Stakeholders can have varying levels of involvement on a project and these levels can, and often do, change as the project proceeds So, stakeholder identification and management is an ongoing process throughout the project Identifying stakeholders at the appropriate time and understanding their relative importance to the project’s success are among the most important tasks that a project manager has Dynamic Nature of Stakeholder Involvement

29. 29 Failing to recognize stakeholders at the appropriate time can have serious impact on a project For example: Not recognizing the need to involve the legal department of your organization early in a project which involves serious legal issues, like privacy, legal permits, intellectual property rights, and so on, can result in disastrous delays and increased costs later on Forgetting about an important class of users and failing to take their perspectives on a software product into account in the planning phases can result in their poor acceptance, or even outright rejection, of the final project result Failure to involve infrastructure resources early on in a project that requires infrastructure upgrades can lead to a failed project Stakeholder Involvement at the Right Time

30. The Organization

31. 31 Let’s reflect a moment about how processes are utilized within organizations Every organization is different, of course, and so we should expect the processes that an organization applies to do its work to differ from organization to organization In other words, processes must be adapted to an organization and sometimes to a project What impacts and influences this adaptation? Processes within Organizations

32. 32 Every organization will have its own unique set of organizational process assets Organizational process assets provide guidelines and criteria for tailoring the organization's processes to the specific needs of projects within that organization According to the PMBOK ® Guide, organizational process assets are: Organizational Process Assets Plans, processes, policies, procedures, and knowledge bases that are specific to and are used by the performing organization.

33. Organizational Structure Consists of three key elements: 1.Designates formal reporting relationships number of levels in the hierarchy span of control 2.Identifies groupings of: individuals into departments departments into the total organization 3.Design of systems for effective communication coordination integration across departments 02-33

34. Forms of Organization Structure Functional organizations – group people performing similar activities into departments Project organizations – group people into project teams on temporary assignments Matrix organizations – create a dual hierarchy in which functions and projects have equal prominence 02-34

35. Functional Organizational Structure 02-35 Figure 2.6 General Management R & DEngineering Manu- facturing MarketingHR International North America

36. Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall Functional Structures StrengthsWeaknesses 1.Firm’s design maintained 2.Fosters development of in-depth knowledge 3.Standard career paths 4.Project team members remain connected with their functional group 1.Functional siloing 2.Lack of customer focus 3.Projects may take longer 4.Projects may be sub- optimized 02-36

37. Silo Effect Found in Functional Structures 02-37 Figure 2.7

38. Project Organizational Structure 02-38 Figure 2.8 In a projectized organization, most of the organization’s work is organized into projects Project managers have a high level of authority and independence In such organizations, which are relatively rare, project management expertise will be a very high level, and upper management oversight will be low

39. Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall Project Structures StrengthsWeaknesses 1.Project manager sole authority 2.Improved communication 3.Effective decision-making 4.Creation of project management experts 5.Rapid response 1.Expensive to set up and maintain teams 2.Chance of loyalty to the project rather than the firm 3.No pool of specific knowledge 4.Workers unassigned at project end 02-39

40. Matrix Organizational Structure 02-40 Figure 2.9 A matrix organization utilizes a blend of functional and projectized organization characteristics Functional managers manage staff within their function, but project managers are employed to manage projects There are three variants of the matrix structure and they differ primarily in the degree of responsibility that project managers have: Weak matrix Balanced matrix Strong matrix

41. Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall Matrix Structures StrengthsWeaknesses 1.Suited to dynamic environments 2.Equal emphasis on project management and functional efficiency 3.Promotes coordination across functional units 4.Maximizes scarce resources 1.Dual hierarchies mean two bosses 2.Negotiation required in order to share resources 3.Workers caught between competing project & functional demands 02-41

42. Heavyweight Project Organizations Organizations can sometimes gain tremendous benefit from creating a fully- dedicated project organization Lockheed Corporation’s “Skunkworks” Project manager authority expanded Functional alignment abandoned in favor of market opportunism Focus on external customer 02-42

43. Manager’s Perceptions of Effectiveness of Various Structures on Project Success 02-43 Figure 2.10

44. Project Management Offices Resource centers for: Technical details Expertise Repository Center for excellence 02-44 A project management office, or PMO, is an organizational structure designed to support and help coordinate the project management activities of the organization (or some subset of the organization).

45. Selecting, managing, and deploying shared project resources, including project managers Coaching, mentoring, and training in project management skills, processes, and techniques Identifying, developing, and monitoring project management methodology, standards. and best-practices Developing project and organizational assets deemed important for successful project management Coordinating communication and interdependencies among projects PMO Activities May Include... 45

46. Organizational Culture The unwritten rules of behavior, or norms that are used to shape and guide behavior, is shared by some subset of organization members and is taught to all new members of the company. Unwritten Rules of behavior Held by some subset of the organization Taught to all new members 02-46

47. Key Factors That Affect Culture Development Technology Environment Geographical location Reward systems Rules and procedures Key organizational members Critical incidents 02-47

48. 48 Let’s reflect a moment about how processes are utilized within organizations Every organization is different, of course, and so we should expect the processes that an organization applies to do its work to differ from organization to organization In other words, processes must be adapted to an organization and sometimes to a project What impacts and influences this adaptation? Processes within Organizations

49. 49 Every organization will have its own unique set of organizational process assets Organizational process assets provide guidelines and criteria for tailoring the organization's processes to the specific needs of projects within that organization According to the PMBOK ® Guide, organizational process assets are: Organizational Process Assets Plans, processes, policies, procedures, and knowledge bases that are specific to and are used by the performing organization.

50. Culture Affects Project Management Departmental interaction Employee commitment to goals Project planning Performance evaluation 02-50

51. Summary Understand how effective project management contributes to achieving strategic objectives. Recognize three components of the corporate strategy model: formulation, implementation, and evaluation. See the importance of identifying critical project stakeholders and managing them within the context of project development. Recognize the strengths and weaknesses of three basic forms of organizational structure and their implications for managing projects. 02-51

52. “Gathering” Project Requirements 52

53. “Gathering” Project Requirements 53

54. “Gathering” Project Requirements 54

55. “Gathering” Project Requirements 55

56. “Gathering” Project Requirements 56

57. “Gathering” Project Requirements 57

58. “Gathering” Project Requirements 58

59. “Gathering” Project Requirements 59

60. “Gathering” Project Requirements 60

61. “Gathering” Project Requirements 61

62. 62

63. Dilbert’s Project Phases 63

64. Dilbert’s Resource Problems 64

65. Dilbert’s Project Timeline 65

66. Dilbert’s Status Report 66