Introduction

1. Introduction Project Management for Business, Engineering, and Technology Prepared by John Nicholas, Ph.D. Loyola University Chicago

2. IENG 466/566 Session One – 24 Jan 2011 • Introduction to the Course • Introduction to Project Management • Project Management Philosophy • Systems Approach

3. Great Pyriamid of Cheops (2,500 B.C.) • 2,300,000 Stone Blocks • 40 Stories • Accuracy of 0.04 inch • 13 acres level within 1 inch • 100,000 laborers 40,000 skilled masons 150,000 women & children

4. From: blog.lib.umn.edu/muwah005/architecture/ From: www.educ.uvic.ca/.../438/CHINA/CHINA-WALL.HTML Evidence of projects is everywhere…

5. …and in the news. Recent examples: • Millennium Park, Chicago • Ground breaking targets, 1998: • Total cost: $150 million • Gehry band shell: $10.8 million • Completion: 2000 (millennium!) • Actual • Total Cost: $475 million • Gehry band shell: $60.3 million • Completion date: Summer 2004

6. From: www.cegltd.com/story.asp?story=8751&headline=... From: www.roadtraffic-technology.com/.../big_dig1.html Recent examples • Boston Big Dig • Cost estimate for total project: Circa 1989, seeking federal funding $ 2.5B • 1991, ground-breaking $ 5 B • 1997 $10.8 B • Summer 2004, 92% complete $14.6 B • Projected at completion $ 20 B??

7. Performance of IT Projects • 2003 “Chaos” Report, Standish Consulting Group • Major IT projects that fail, 66% • Average cost overrun, 43% • Projects with schedule overrun, 82% • Required features/functions not included in released system, 48%

8. Performance (cont’d) • Criteria for Project “Failure” or “Overrun” • >20% over budget, and • >20% late, and • >20% of business requirements not met

9. Why Do Projects Fail or Suffer Overruns? • Typical reasons • Weather • Inadequate requirements definition • Insufficient resources • Changing priorities of customer or management • Intractable technical problems • Resistance from stakeholders • Wrong project for the stated needs • Inadequate tracking and control • Inexperienced project manager and/or team

10. Project Failure, Sources and Solutions

11. Project Failure, Sources and Solutions PROJECT MANAGEMENT!

12. What’s a “Project?” • Goal-oriented • Aims at a specific end result or deliverables • Somewhat unique • Non-routine • Time- and resource-constrained • Temporary; has target completion date and target cost

13. From: history.sandiego.edu/gen/WW2Index/picindex5.html What’s a “Project?” (cont’d) Mulberry harbor example • Cross-functional • Cross-disciplinary • Cross-organizational • Somewhat unfamiliar and risky • Involves something new or different • Something is at stake • Follows logical sequence or progression of phases or stages

14. What is “Project Management?” Simple Definition • Management to accomplish project goals.

15. What is “Project Management?” Longer Definition Management to • Define and execute everything necessary to complete a complex system of tasks • Achieve project end results that might be unique and unfamiliar • Do it • by target completion date • with constrained resources • with an organization that is cross-functional and newly-formed

16. Cost Time Performance Project Goals Ref: M. Rosenau, Successful Project Management, LL Pubs., 1981

17. Key Elements of Project Management: Project Methodology Project Manager Project Team

18. PMBOK, Nine Areas of Knowledge • Project Integration Management • Project Scope Management • Project Time Management • Project Cost Management • Project Quality Management • Project Human Resource Management • Project Communications Management • Project Risk Management • Project Procurement Management

20. Planning Purpose or Goal Change Control Organizing Leadership Management Functions

21. Characteristics of Projects • Goal-oriented • Aims at a specific end result or deliverables • Somewhat unique • Non-routine • Time- and resource-constrained • Temporary; has target completion date and target cost

22. Characteristics of Projects • Cross-functional • Cross-disciplinary • Cross-organizational • Somewhat unfamiliar and risky • Involves something new or different • Something is at stake • Follows logical sequence or progression of phases or stages

23. What is “Project Management?” Simple Definition • Management to accomplish project goals.

24. What is “Project Management?” Longer Definition Management to • Define and execute everything necessary to complete a complex system of tasks • Achieve project end results that might be unique and unfamiliar • And do it • by target completion date • with constrained resources • with an organization that is cross-functional and newly-formed

25. Characteristics of Projects • A single person, the project manager, heads the project organization. The project organization reflects the cross-functional, goal-oriented, temporary nature of the project. • The project manager is the person who brings together all efforts to meet project objectives. • Project requires a variety of skills and resources, and is performed by people from different functional areas or by outside contractors. • The project manager integrates people from different areas and disciplines in the project.

26. Characteristics of Projects • Project manager negotiates with functional managers for personnel. Functional managers responsible for work tasks and personnel in the project; project manager responsible for integrating tasks. • Project manager focuses on delivering product or service according to time, cost, and technical requirements. Functional managers maintain pool of resources to support organizational goals; sometimes conflicts arise over allocation of resources to projects. • A project might have two chains-of-command, one functional and one project; workers might report to both a project manager and a functional manager.

27. Characteristics of Projects (cont’d) • Decision making, accountability, outcomes, and rewards are shared among members of the project team and supporting functional units. • Each project organization is temporary. When project ends, the project organization disbands and people return to their functional or subcontracting units, or are reassigned to new projects. • Project management sets into motion work in numerous support functions such as HR, accounting, procurement, and IT.

28. Project Management in History The role*of the project manager has existed for a long time. Two examples: • The title of project manager is recent and became common starting • in the 1950’s.

29. 1413 Santa Maria del Fore, FlorenceFilippo Brunelleschi

30. Santa Maria del Fore

31. Santa Maria del ForeBrunelleschi’s mandate To “provide, arrange, compose or cause to have arranged and composed, all and everything necessary and desirable for the building, continuing, and completing the dome.” Circa 1413

32. Advanced engine development at Pratt & Whitney,1939

33. 1939 internal memo to establish new role, the “project engineer” • Project Engineers should in effect be Chief Engineers for their particular project • …they should then have at all times a general knowledge of the entire company situation concerning their project and…their thinking will be guided by this picture… • [They] should appreciate the functioning of each of the subdivision [of the project, including] • Product (engineering) • Sales • Manufacturing • Quality • Service

34. Recent History of Project Management • 1969 PMI founded by 5 volunteers • 1992 5000 members • 2004 142,000 members • 2005 over 170,000 members worldwide in 120 countries • 1958 Publication of many articles on project management • 1961 Systems Managers at IBM

35. Where Do You Need Project Management? • Is Unfamiliar The job is different from the ordinary and routine. Requires that different things be done, the same things be done differently, or both. • Requires Greater Effort The job requires more resources (people, capital, equipment, etc.) than are normally employed by the department or organization. • Is in a Changing Environment The industry or environment involves high innovation, high competition, rapid product change, shifting markets. Answer: Situations where the work …

36. Where Do You Need Project Management? • Requires a Multifunctional Effort The job requires lateral relationships between the areas to coordinate and expedite work and reconcile conflicts. • Could Impact the Reputation of the Organization or Other Stakeholders Failure to satisfactorily complete the work could result in financial ruin, loss of market share, damaged reputation, loss of future contracts, or other problems for the stakeholders or larger environment. Answer: Situations where the work …

37. Different Forms of Project Management Basic Project Management • Most common project approach • Project manager has authority to plan, direct, organize, and control the project from start to finish. • PM and functional managers are on the same organizational level. • Implemented in two widely used forms—pure project and matrix. • In pure project, the project is a complete, self-contained organization • In matrix, the project is created from resources borrowed from the functional units.

38. Different Forms of Project Management Program Management • Similarity between programs and projects • both defined in terms of goals or objectives about what must be accomplished • both emphasize time period over which goals or objectives are to be pursued • both require plans, budgets, and schedules for accomplishing specific goals. • Differences between programs and projects • Program extends over a longer time horizon • It consists of several parallel or sequential work efforts or projects coordinated to meet a program goal. • Projects within a program share a common goal and resources, and often are interdependent.

39. Different Forms of Project Management (cont’d) New Venture Management • Used for generating new products or markets. • Team is specially created to find products/markets that fit the organization’s specialized skills, capabilities, and resources. • After defining a product, the team may go on to design and develop it, then determine means for producing, marketing, and distributing it. • Similarities between project groups and venture groups • Focus on a single unifying goal. • Multidisciplinary, with experts and managers from various functional areas • Action-oriented and dedicated to change. • Temporary.

40. Different Forms of Project Management (cont’d) Product Management • A single person has authority to oversee all aspects of a product’s production scheduling, inventory, distribution, and sales • Like the project manager, the product manager communicates directly with all levels and functions within and outside the organization • The product manager coordinates functional units so that the total effort is directed at the accomplishment of product goals.

41. Different Forms of Project Management (cont’d) Ad Hoc Committees and Task Forces • For some projects of short or medium duration, a temporary team is assembled with a project leader. • The team is an ad hoc committee called a task force or interdepartmental committee. • The leader and members are selected by (and the leader reports directly to) the person responsible for the project—a functional manager, vice president, or CEO. • The leader expedites and coordinates efforts and may have authority to direct project tasks to certain individuals or units, or to contract work out.

42. Project Management • Project involves a single definable purpose • Cuts across organizational lines • Unique, one time activity • Unfamiliar • Temporary activity • Process of working to achieve a goal • Phases constitute Life Cycle

43. Space Station (US, Canada Europe, Japan) Resource (gas, oil) Exploration Uncertainty in Cost, Time, Performance Manhattan Trans-English Channel Company Moves Motion Pictures Panama Canal Family Moves Term Papers Ships Skyscrapers Olympic Games Market Surveys Interstates Individual Group Organization Multiorg. Multination Cost - Time (Labor Hours) Complexity Topology of Projects

44. Basic Research Applied Research Cost of Project Product Development Military Campaigns Construction Individual Group Organization Multiorg. Multination Cost - Time (Labor Hours) Complexity Topology of Projects Uncertainty in Cost, Time, Performance

45. Top Management Accounting Engineering Manufactur. Procurement Task A Projec t One Task B Task C Project Organization

46. Review How is project management different from functional management?

47. Review • How is project management different from functional management? Functional organizations are efficient in stable environments, they tend to be rigid and, thus, unsuitable for the unstable and dynamic environments that characterize projects.

48. Project Mgmt. Characteristics • Project manager operates project independently of normal chain-of-command • Project manager is focal point for all efforts of project • Work on project is performed by many functional areas • Project team responsible for integrating people from different functional areas

49. Project Mgmt. Characteristics • Project manager negotiates with functional managers for support • There will be conflict for resources between project goals and functional goals • Project might have 2 chains-of-command • vertical and functional • horizontal and project (fig. 1.5) • Decision making, accountability, and outcomes shared among team members

50. Top Management Accounting Engineering Manufactur. Procurement Task A Projec t One Task B Task C Task D Project Two Task E 2-Chains of Command