Lecture 2 – 8/28/2013

1. Lecture 2 – 8/28/2013 • Review—with recitation • What is a project? • Can you draw the PMI Lifecycle? • PMI Lifecycle • How do IT Projects Differ from Ordinary Projects? • Project tools • PMI • PMI Knowledge Areas • PMI Processes • History

2. What is a project? • A specific objective must be completed within certain specifications • Has a definite starting date and end date • Has funding limitations • Consumes resources (money, people, time, equipment) • Made up of activities (tasks) • Accomplished in teams

3. PMI’s Definition of Project Management? Project management is “a temporary endeavor undertaken to create a unique product, service, or result. The temporary nature of projects indicates a definite beginning and end.” (PMI*, Project Management Body of Knowledge (PMBOK Guide), 2008, pg. 5) *The Project Management Institute (PMI) is an international professional society. Their web site is www.pmi.org.

4. Information Technology Project Management, Seventh Edition Project Management Statistics • The overall information and communications technology market grew by 6 percent to almost $3 trillion in 2010 • In the U.S. the size of the IT workforce topped 4 million workers in 2008, and the unemployment rate for IT professionals is half the rate for the overall labor market • In 2011 the total compensation for the average senior project manager in U.S. dollars was $105,000 per year in the United States and $160,409 in the Switzerland. • The number of people earning their Project Management Professional (PMP) certification continues to increase. 44 percent of employers listed project management as a skill they looked for in new college grads, behind only communication and technical skills

5. Information Technology Project Management, Seventh Edition Motivation for Studying Information Technology (IT) Project Management • IT Projects have a terrible track record • A 1995 Standish Group study (CHAOS) found that only 16.2% of IT projects were successful in meeting scope, time, and cost goals; over 31% of IT projects were canceled before completion. The number of successful IT projects has more than doubled, from 16 percent in 1994 to 37 percent in 2010 • The number of failed projects decreased from 31 percent in 1994 to 21 percent in 2010 • A PricewaterhouseCoopers study found that overall half of all projects fail and only 2.5% of corporations consistently meet their targets for scope, time, and cost goals for all types of project.

6. Information Technology Project Management, Seventh Edition Table 1-4. Nine Hottest Skills* *Source: Rick Saia, “9 Hot IT Skills for 2012,” Computerworld, September 26, 2011.

7. Information Technology Project Management, Seventh Edition Careers for IT Project Managers • In a 2011 survey, IT executives listed the “nine hottest skills” they planned to hire for in 2012 • Projectmanagement was second only to programming and application development

8. Sooo What Is a Project, exactly?? • A project is a temporary endeavor undertaken to accomplish a unique purpose • As defined by the Project Management Institute • Attributes of projects • Unique purpose • Temporary • Require resources, often from various areas • Should have a primary sponsor and/or customer • Involves risk and uncertainty • Has stakeholders

9. The Project LifeCycle STAGE 1: Conceptualizing-and-Defining STAGE 2: Planning-and-Budgeting STAGE 3: Executing STAGE 5: Terminating-and-Closing STAGE 4: Monitoring-and-Controlling

10. Project Life Cycle FIGURE 1.1

11. Comparison of Routine Work with Projects Routine, Repetitive Work Taking class notes Daily entering sales receipts into the accounting ledger Responding to a supply-chain request Practicing scales on the piano Routine manufacture of an Apple iPod Attaching tags on a manufactured product Projects Writing a term paper Setting up a sales kiosk for a professional accounting meeting Developing a supply-chain information system Writing a new piano piece Designing an iPod that is approximately 2 X 4 inches, interfaces with PC, and stores 10,000 songs TABLE 1.1

12. How do IT Projects differ from ordinary projects? • Ordinary projects might be projects in construction, aerospace, defense, space, government, etc. • Each IT Project is unique and thus involves more risk • The technology is continually changing • Construction projects have much more definitive requirements, much less risk • There is less visibility

13. How do IT Projects differ from ordinary projects, continued? • There is a tendency to spend too much time on concept definition and analysis in IT projects • There tends to be less organizational maturity in IT projects • Maturity is a big issue here • Watts Humphrey

14. How are IT Projects similar to ordinary projects? • They have all the common basic attributes of projects—starting point, stopping point, duration, finite, temporary, creating a deliverable or product, utilizing resources, accomplished in teams, consisting of steps (tasks), accruing cost, etc. • All projects involve risk, accrue expenditures, involve procurement, human resources, etc.

15. Who does project work? • Accountants—each customer is a ‘project’ • Engineers, Lawyers • Scientists, Administrators • Contractors—electrical, plumbing, AC • For these people project management is not a title but a critical job requirement

16. The Project LifeCycle STAGE 1: Conceptualizing-and-Defining STAGE 2: Planning-and-Budgeting STAGE 3: Executing STAGE 5: Closing and Terminating STAGE 4: Monitoring-and-Controlling

17. Project management involves • Conceptualizing and Defining • Definition of work requirements--WORK BREAKDOWN STRUCTURE--WBS • Planning and Budgeting • Determination of quantity and quality of work • Determination of what resources are needed when • Executing • Actual execution of the project tasks take place here • Tracking progress • Comparing actual to predicted outcomes • Analyzing impact/Making adjustments • Closing and Terminating • What went right? What went wrong? • What can be learned? • Monitoring and Controlling

18. Successful Project management requires completion of the project • on time • within budget • with the desired performance/technology level • with good customer satisfaction/relations • while using the assigned resources effectively • What is the probability of pulling this off for IT projects????

19. Why do bad things happen to good projects??? • Ill-defined requirements • Poorly conceived project deliverable • No shared vision of what the project is to accomplish • Poor planning • No schedule • No budget • No concern for quality/risk/procurement • Resources don’t materialize when they are needed • Subcontractors don’t deliver on time • Requirements change • Technology changes

20. Metzger’s List of Software Development Problems • Ill-defined contract • Poor planning • Unstable problem definition • Poor planning • Inexperienced management • Poor planning, training • Political pressures • Poor planning • Ineffective change control • Poor planning • Unrealistic deadlines • Poor planning

21. When is project management necessary? • when jobs are complex • when there are dynamic environmental considerations • when constraints on time and budget are tight • when there are several activities to be integrated • when there are functional boundaries to be crossed

22. Project management encompasses many disciplines • Operations management • Operations research • Psychology • Sociology • Organization theory • Organizational behavior • Systems thinking and management

23. Project Management Tools and Techniques • Project management tools and techniques assist project managers and their teams in various aspects of project management • Some specific ones include • Project Charter and WBS (scope) • Gantt charts, PERT charts, Critical Path Method (CPM), network charts, resource charts, etc. • Cost estimates and Earned Value Analysis (cost) • MS Project, BaseCamp, Visio, others • Follow me (Jim Burns) on Pinterest

24. GANTT CHART

25. Figure 1-4. Sample Gantt Chart* Gantt Chart *This template file comes with MS Project

26. WORK BREAKDOWN 1

27. WORK BREAKDOWN 2

28. NETWORK CHART 1

29. Figure 1-5. Sample Network Chart Each box is a project task from the WBS. Arrows show dependencies between tasks.The tasks in red are on the critical path. If any tasks on the critical path take longer than planned, the whole project will slip unless something is done.

30. Motivation for Studying Information Technology (IT) Project Management • IT Projects have a poor track record • A 1995 Standish Group study found that only 16.2% of IT projects were successful • Over 31% of IT projects were canceled before completion, costing over $81 B in the U.S. alone • A ComputerWorld article listed “project manager” as the #1 position IT managers say they need most for contract help • Often, this leads to distributed PM • Projects create ¼ of the US and world GDP

31. The Triple Constraint • Every project is constrained in different ways by its • Scope goals • Time goals • Cost goals • It is the project manager’s duty to balance these three often competing goals

32. Project Stakeholders • Stakeholders are the people involved in or affected by project activities • Stakeholders include • the project sponsor and project team • The project sponsor is the person who funds the project • support staff • customers • users • upper management • line management • suppliers • opponents to the project

33. Ten Project Management Knowledge Areas • Knowledge areas describe the key competencies that project managers must develop • Four core knowledge areas lead to specific project objectives (scope, time, cost, and quality) • Five facilitating knowledge areas are the means through which the project objectives are achieved (human resources, communication, risk, and procurement management • One knowledge area (project integration management) affects and is affected by all of the other knowledge areas

34. PM Knowledge Areas Core Knowledge Areas Facilitating Knowledge Areas Project Stakeholder Management

35. Project Management Framework – PMI – 3RD Edition T T

36. Information Technology Project Management, Seventh Edition Figure 1-2 Project Management Framework—PMI 4th Edition

37. Advantages of Project Management • Bosses, customers, and other stakeholders do not like surprises • Good project management (PM) provides assurance and reduces risk • PM provides the tools and environment to plan, monitor, track, and manage schedules, resources, costs, and quality • PM provides a history or metrics base for future planning as well as good documentation • Project members learn and grow by working in a cross-functional team environment Source: Knutson, Joan, PM Network, December 1997, p. 13

38. How Project Management (PM) Relates to Other Disciplines • Much of the knowledge needed to manage projects is unique to PM • However, project managers must also have knowledge and experience in • general management • the application area of the project • Project managers must focus on meeting specific project objectives

39. Figure 1-3. Project Management and Other Disciplines

40. History of Project Management • Modern project management began with the Manhattan Project, which the U.S. military led to develop the atomic bomb • In 1917 Henry Gantt developed the Gantt chart as a tool for scheduling work in job shops • In 1958, the Navy developed PERT charts • In the 1970s, the military began using project management software, as did the construction industry • By the 1990s, virtually every industry was using some form of project management

41. The Project Management Profession • A 2006 Fortune article called project management the “number one career choice” • Other authors, like Tom Peters and Thomas Stewart, stress that projects are what add value to organizations • Professional societies like the Project Management Institute have grown tremendously

42. Information Technology Project Management, Seventh Edition Figure 1-9 Growth in PMP Certification, 1993-2011

43. Project Management Certification • PMI provides certification as a Project Management Professional (PMP) • A PMP has documented sufficient project experience, agreed to follow a code of ethics, and passed the PMP exam • The number of people earning PMP certification is increasing quickly

44. Code of Ethics • PMI developed a project management code of ethics that all PMPs must agree to abide by • Conducting work in an ethical manner helps the profession earn confidence • Ethics are on the web at www.pmi.org/certification/code.htm

45. CAPM (Certified Associate in Project Management) • Requires passing an exam prepared by PMI only.

46. Discussion Questions • Give three examples of activities that are projects and three examples of activities that are not projects • How is project management different from general management? • Why do you think so many information technology projects are unsuccessful?

47. A Favorite Web Site • http://portfolio-engineering.com