1. Chapter 1 Project Management Concepts

3. Learning Objectives Definition of a project and its attributes
Key constraints within which a project must be managed
How a project is “born”
Life of a project
Steps involved in the PM process
Implications of global project management
Benefits of project management 3 2 2 2 2 2 2 2 2 2

4. Real World Example
Vignette: Irish Agency Cancels Two SAP AG ERP Projects
Oct 05: Irish Health Svc Executive halted two system rollouts
Personnel Payroll project:
Launched in 95; budget of $10.7m; 3 year schedule
By 2005, cost up to $180m; then cancelled
Financial Information Systems project
Spent $36m; expected to cost a total of $203m
Consulting firm in New York was the contractor hired to implement both projects
Lots of wasted time, money and effort
Proper project management can help prevent these failures 4 3 3 3 3 3 3 3 3 3

5. Real World Example Vignette: Maine’s Medical Mistake
Jan 05, new Medicare claims system was introduced
Designed to process $1.5b in annual claims; cost $25m
Immediately had problems with rejected claims
By end of March, 300,000 claims had been “suspended”
By the end of summer, up to nearly 650,000
Patients being turned away; businesses suffering greatly
Since implementation, system cost $30m; now claim most of bugs are fixed
Problems: Vendor had no Medicaid system experience; used unproven technology; no backup; lack of testing & training
Poor PM and communication: “It was clear that we were missing any sort of basic management of this project…” 5 5 5 4 5 4 4 4 4 4

6. Project, Defined A project is:
an endeavor to accomplish a specific objective
through a unique set of interrelated tasks
and the effective utilization of resources. 6 7 7 5 7 5 5 5 5 5

7. Attributes of a Project
Has a well-defined objective
Composed of a series of interdependent tasks
Utilizes various resources
Has a specific time frame
May be a unique or one-time endeavor
Has a customer
Involves a degree of uncertainty 7 8 8 6 8 6 6 6 6 6

8. Examples of Projects Planning a wedding
Designing and implementing a computer system
Hosting a holiday party
Designing and producing a brochure
Executing an environmental clean-up of a contaminated site
Holding a high school reunion
Performing a series of surgeries on an accident victim 8 10 10 7 10 7 7 7 7 7

9. Constraints Scope Cost Schedule Customer satisfaction 9 11 11 8 11 8 8

10. Unforeseen Circumstances
Unforeseen circumstances may jeopardize achievement of the project objective.
The challenge facing the project manager is to prevent, anticipate, and/or overcome such circumstances. 10 14 14 9 14 9 9 9 9 9

11. The Project Life Cycle
Projects are “born” when a need is identified by the customer.
Project life cycles vary in length, from a few weeks to several years.
Not all projects formally go through all four phases of the project life cycle. 11 16 16 10 16 10 10 10 10 10

12. Project Life Cycle: Phase 1
The first phase involves the identification of a need, problem, or opportunity.
The need and requirements are usually written by the customer into a document called a request for proposal (RFP). 12 17 17 11 17 11 11 11 11 11

13. Project Life Cycle: Phase 2
The second phase is the development of a proposed solution to the need or problem.
This phase results in the submission of a proposal.
The customer and the winning contractor negotiate and sign a contract (agreement). 13 18 18 12 18 12 12 12 12 12

14. Project Life Cycle: Phase 3
The third phase is performing the project.
Different types of resources are utilized
Results in the accomplishment of the project objective
Includes:
Detailed planning
Implementation of the plan 14 19 19 13 19 13 13 13 13 13

15. Project Life Cycle: Phase 4
The final phase is terminating the project.
Perform close-out activities
Evaluate performance
Invite customer feedback 15 20 20 14 20 14 14 14 14 14

17. The Project Management Process
The project management process means planning the work and then working the plan. 17 21 21 15 21 15 15 15 15 15

18. The Project Management Process (Cont.)
Clearly define the project objective.
Divide and subdivide the project.
Define the specific activities that need to be performed.
Graphically portray the activities in a network diagram. 18 22 22 16 22 16 16 16 16 16

19. The Project Management Process (Cont.)
Make a time estimate.
Make a cost estimate.
Calculate a project schedule and budget.
RESULT: BASELINE PLAN 19 24 24 17 24 17 17 17 17 17

20. Controlling Projects Establish a baseline plan. Monitor progress.
Measure actual progress and compare it to planned progress.
Take corrective action if the project is behind schedule, overrunning the budget, or not meeting technical specifications. 20 25 25 18 25 18 18 18 18 18

21. Global Project Management
Globalization adds unique challenges
Cultural & language differences
Economic considerations
Political considerations
Workforce availability
Technology & Internet help globalization and provide new opportunities
Cultural awareness and sensitivity are vital

22. Benefits of Project Management
Satisfied customers
Additional business
Expansion of career opportunities
Satisfaction of being on a winning team
Improved knowledge and skills
When projects are successful, everybody WINS 21 28 28 19 28 19 19 19 19 19

23. Dice.com
Monster.com 22