01 project management

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MANAJEMEN

INDUSTRI TEKNOLOGIINFORMASI

LESSON 1


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Project

30/06/2013Manajemen Industri Teknologi Informasi - Ganjil 2012

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A project is a complex, non-routine, one-time effort limited by time,budget, resources, and performance specifications designed tomeet customer needsThe major goal: to satisfy a customers need

A project can be considered to be any series of activities and tasks

that have the major characteristics: An established objective Have a specific objective to be completedwithin certain specifications

A defined life span with a beginning and an end Have defined startand end datesUsually, the involvement of several departments and professionals

Are multifunctional (i.e., cut across several function lines)Typically, doing something that has never been done beforeSpecific time, cost, and performance requirements

Have funding limits (if applicable)Consume human and nonhuman resources (i.e., money, people, equipment)


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Project


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The Project Life Cycle (1)


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The life cycle recognizes that projects have alimited life span and that there are predictablechanges in level of effort and focus over the

life of the projectProject effort starts slowly, builds to peak, andthen declines to delivery of the project to thecustomer

Four typically stages:DefinitionPlanningExecutionDelivery


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Definitionspecifications of the project are definedproject objectives are establishedteams are formedmajor responsibilities are assigned


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PlanningThe level of effort increasesPlans are developed to determine:

What the project will entailwhen it will be scheduledwhom it will benefitwhat quality level should be maintainedwhat the budget will be


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Execution A major portion of the project work takes place both physical and mental

The physical product is producedTime, cost, and specification measures are usedfor control

Is the project on schedule, on budget, and meetingspecificationsWhat are the forecasts of each these measuresWhat revisions/changes are necessary


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DeliveryDelivering the project product to the customer

Customer training

Transferring documentsRedeploying project resources

Releasing project equipment/materials to other projects

Finding new assignments for team members


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Project Management (1)


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Is the art of creating the illusion that any outcomeis the result of a series of predetermined,deliberate acts when, in fact, it was dumb luckIs the planning, organizing, directing, andcontrolling of company resources for a relativelyshort-term objective that has been established tocomplete specific goals and objectives.Furthermore, project management utilizes thesystems approach to management by havingfunctional personnel (the vertical hierarchy)assigned to a specific project (the horizontalhierarchy)


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Involves project planning and projectmonitoring

Project planning

Definition of work requirementsDefinition of quantity and quality of workDefinition of resources needed

Project monitoringTracking progressComparison actual outcome to predicted outcome

Analyzing impactMaking adjustments


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The Importance of Project ManagementCompression of the Product Life CycleGlobal Competition

Knowledge ExplosionCorporate DownsizingIncreased Customer Focus

Rapid Development of Third World and ClosedEconomiesSmall Projects Represent Big Problems


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The potential benefits from project managementare:

Identification of functional responsibilities to ensurethat all activities are accounted for, regardless of

personnel turnover Minimizing the need for continuous reportingIdentification of time limits for schedulingIdentification of a methodology for trade-off analysisMeasurement of accomplishment against plansEarly identification of problems so that correctiveaction may followImproved estimating capability for future planningKnowing when objectives cannot be met or will beexceeded


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Unfortunately, the benefits cannot be achievedwithout overcoming obstacles such as:

Project complexity

Customers special requirements and scopechangesOrganizational restructuringProject risksChanges in technologyForward planning and pricing


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The Project Manager (1)


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Management decides and implements the waysand means to effectively and efficiently utilizehuman and nonhuman resources to reachpredetermined objectives (money, manpower,equipment, facilities, materials,information/technology)Project managers perform the same functions asother managers: they plan, schedule, motivate,and controlThe project manager is unique because she/hemanages temporary, non-repetitive activities andfrequently acts independently of the formalorganization


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Project managers are expected to marshalresources to complete a fixed-life project ontime, on budget, and within specifications

Project managers are the direct link to thecustomer and must manage the interfacebetween customer expectations and what isfeasible and reasonable

Project managers provide direction,coordination, and integration to the projectteam, which is often made up of part-timeparticipants loyal to their functional

departments


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Project managers are responsible for performance(frequently with too little authority)Project managers must ensure that appropriate

trade-offs are made between the time, cost, andperformance requirements of the projectProject managers generally posses onlyrudimentary technical knowledge to make suchdecisionsProject managers must orchestrate thecompletion of the project by including the rightpeople, at the right time, to address the rightissues and make the right decisions


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Discussion

What are the habits of successful projectmanagers?Im an experienced individual contributor butvery new to project management. How do I getmy new project up and going?


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The Project Manager-LineManager Interface


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Successful project management is strongly dependent on: A good daily working relationship between the project manager and those line managers who directly assign resources toprojectsThe ability of functional employees to report vertically to line

managers at the same time that they report horizontally to one or more project managersThe project manager actually works for the line managers,not vice versa the project manager is simply the agentthrough whom this is accomplishedProjects manager depend on line managersEffective project management requires an understanding of:

Quantitative tools and techniquesOrganizational structuresOrganizational behaviour


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The Project Managers Role


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The project manager is responsible for coordinatingand integrating activities across multiple functionallinesThe integration activities performed by the project

manager includeIntegrating the activities necessary to develop a projectplanIntegrating the activities necessary to execute the planIntegrating the activities necessary to make changes to theplan

The project manager must convert the inputs intooutputs of products, services, and ultimately profitsThe project manager needs strong communicativeand interpersonal skills, must become familiar with the

operations of each line organization, and must haveknowledge of the technology being used


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The Line Managers Role (1)


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A specific role for the functional manager The functional manager has the responsibility todefine how the task will be done and where the

task will be done (i.e., the technical criteria)The functional manager has the responsibility toprovide sufficient resources to accomplish theobjective within the projects constraints (i.e., who

will get the job done)The functional manager has the responsibility for deliverable


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The Line Managers Role (2)


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The line managers problems: Unlimited work requests (especially during competitivebidding)Predetermined deadlines

All requests having a high priorityLimited number of resourcesLimited availability of resourcesUnscheduled changes in the project planUnpredicted lack of progress

Unplanned absence of resourcesUnplanned breakdown of resourcesUnplanned loss of resourcesUnplanned turnover of personnel


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The Evolution of ProjectManagement Systems (1)


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A three-phase model:Phase One: Ad Hoc UsePhase Two: Formal Application

Phase Three: Project-Driven Organization


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Phase One: Ad Hoc UseTypically begins with an individual or departmentchampion initiating the use of one or more the basicproject management tools in a project

The tools appear to hold potential for improvingproject successTop management will have little or no involvement inthe decision to use these tools

In a few cases, these attempts end in failureNear the end of this phase, conflicts across functionallines often appear as tensions arise over the controland directions of projects


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Phase Two: Formal ApplicationVarious needs and inadequacies are recognized as barriers to projectsuccessTypical of this phase is the recognition that project management trainingis needed for every management level in the organizationTop management takes an interest in better management of projectsThe need for quality control becomes an issueThe concept of a customer or client for each project becomes part of theorganizational cultureProjects managers are given more control over the projectsQuestions relating to the effectiveness of the current organizationstructure are heard in private conversationsTop management is not active in project selection and prioritizingprojectsManagement needs a retreat to integrate strategic planning and projects


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Phase Three: Project-Driven OrganizationThe outlook is long runTop management is now playing a significant role in settingstrategy, in developing a balanced project portfolio, and in settingproject priorities

Project management is a part of the organizational cultureThe organizational structure has shifted toward a project matrixand project teams with dedicated resourcesProjects are integrated with accountingTraining and policy manuals have been written for each phase of the project life cycleTermination of projects includes a project audit and evaluation of time, cost, and technical performanceThe outcome of this effort is disciplined, integrated,organizational approach to managing and implementing projectslinked to strategic plans


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These three phase occur at different timesdepending on the type and size of the firmIt is probably desirous to move to phase threeas quickly as possible to compete moreeffectivelyMigration to excellence can be expedited by

developing the skills and capabilities of everymanager in the organization through training inproject management


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An Integrative Approach (1)


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As the world becomes more competitive, theimportance of managing the process of projectmanagement and getting it right the first time takeson new meaning

Piecemeal systems fail to tie to the overall strategies of thefirmPiecemeal project priority systems fail to prioritize projectselection to resources and those projects that contributemost to the strategic plan

Piecemeal tools and techniques fail to be integratedthroughout the project life cyclePiecemeal approaches fail to balance the application of project planning and control methods with appropriateadjustments in the organizations culture to support projectendeavour


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Today emphasis is on development of anintegrated project management process thatfocuses all project effort toward the strategic plan

of the organization and reinforces mastery of boththe project management tools/techniques and theinterpersonal skills necessary to orchestratesuccessful project completion

Integration in project management directsattention to two key areas:

Integration of projects with the strategic planIntegration within the process of managing actualprojects


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Integration of projects with the strategic planIn some organizations, selection and management of projectsoften fail to support the strategic plan of the organization

Strategic plan are written by one group of managers, projectsselected by another group, and projects implemented by another

An integrated project system is one in which all of the parts areinterrelatedMission, objectives, and strategies are set to meet the needs of customersDevelopment of a mission, objectives, and strategies depend on theexternal (political, social, economic and technological) and internal(management, facilities, core competencies, financial condition)environmental factors

Implementing strategies are the most difficult step; strategies aretypically implemented through projects

Prioritizing projects so that scarce resources are allocated to the rightprojects


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ScopeWork Breakdown Organization

Networks LeadershipResources Teams

Cost Partners

Customer

Environmental Analysis

Project Implementation

Environmentand cultureSystem

Projects

External Internal

FirmMission

Goals, Strategies

Priorities


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Integration within the process of managing actual projectsThe technical side of the management process

Consists of the formal, disciplined, pure logic parts of the processRelies on the formal information system availableIncludes planning, scheduling, and controlling: Scope, WBS, Schedules,Resource Allocation, Baseline Budgets, Status Reports

Represents the science of project management The socio-cultural side of the management process

Involves the much messier, often contradictory and paradoxical world of implementation: leadership, problem solving, teamwork, negotiation, politics,customer expectationsCentres on creating a temporary social system within a larger organizationalenvironment that combines the talents of a divergent set of professionalsworking to complete the projectInvolves managing the interface between the project and external environmentRepresents the art of managing a project


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Project-Driven versus Non-Project-Driven Organizations


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Project-Driven Organization All work is characterized through projects, with eachproject as a separate cost centre having its own profit-and-loss statement

The total profit to the corporation is simply the summationof the profits on all projectsEverything centres around the projects

Non-Project-Driven OrganizationProfit-and-loss are measured on vertical or functional linesProjects exist merely to support the product lines or functional linesPriority resources are assigned to the revenue-producingfunctional line activities rather than the projects


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Project management in a non-project-driven organization isgenerally more difficult for these reasons:

Projects may be few and far betweenNot all projects have the same project management requirements, andtherefore they cannot be managed identically. This difficulty results frompoor understanding of project management and a reluctance of companies to invest in proper trainingExecutives do not have sufficient time to manage projects themselves,yet refuse to delegate authorityProjects tend to be delayed because approvals most often follow thevertical chain of command. As a result, project work stays too long infunctional departments

Because project staffing is on a local basis, only a portion of theorganization understands project management and sees the system inactionThere is heavy dependence on subcontractors and outside agencies for project management expertise


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Non-project-driven organizations may alsohave a steady stream of projects, all of whichare usually designed to enhancemanufacturing operations.Some projects may be customer-requested,such as:

The introduction of statistical dimensioning

concepts to improve process controlThe introduction of process changes to enhancethe final productThe introduction of process change concepts toenhance product reliability


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If these changes are not identified as specificprojects, the result can be:

Poorly defined responsibility areas within the

organizationPoor communication, both internal and external tothe organizationSlow implementation

A lack of a cost-tracking system for implementationPoorly defined performance criteria


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The tip-of-the-iceberg syndrome can occur inall types of organizations but is most commonin non-project-driven organizations

On the surface, all we see is lack of authorityfor the project manager. But, beneath thesurface we see the causes; there is excessivemeddling due to lack of understanding of project management, which, in turn, resultedfrom an inability to recognize the need for proper training


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Delegation of authority to

project manager

Excessive meddlingLack of understanding of how project management

should work

Lack of training in communication/interpersonal skills

Many of the problems surface much later in the projectand result in a much higher cost to cor rect as well as

increase project r isk

k i i h j i


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Marketing in the Project-DrivenOrganization


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Getting new projects is the lifeblood of anyproject-oriented businessMarketing projects requires the ability to identify,pursue, and capture one-of-a-kind businessopportunities, and is characterized by:

A systematic effortCustom designProject life cycleMarketing phaseRisksThe technical capability to perform

M k i i h P j D i


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In spite of the risks and problems, profits onprojects are usually very low in comparisonwith commercial business practices

One may wonder why companies pursueproject businesses

M k i i h P j D i


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Clearly, there are many reasons why projects are good business: Although immediate profits (as a percentage of sales) are usually small,the return on capital investment is often very attractive. Progresspayment practices keep inventories and receivables to a minimum andenable companies to undertake projects many times larger in value thanthe assets of the total company

Once a contract has been secured and is being managed properly, theproject may be of relatively low financial risk to the company. Thecompany has little additional selling expenditure and has a predictablemarket over the life cycle of the projectProject business must be viewed from a broader perspective thanmotivation for immediate profits. Projects provide an opportunity todevelop the companys technical capabilities and build an experience

base for future business growthWinning one large project often provides attractive growth potential,such as (1) growth with the project via additions and changes; (2) follow-on work; (3) spare parts, maintenance, and raining; and (4) being able tocompete effectively in the next project phase, such as nurturing a studyprogram into a development contract and finally a production contract


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Classification Projects


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Type of Project/Industry

In-houseR&D

SmallConstruction

LargeConstruction

Aerospace/Defence

MIS Engineering

Need for interpersonalskills

Low Low High High High Low

Importance of organizationalstructure

Low Low Low Low High Low

Timemanagementdifficulties

Low Low High High High Low

Number of meetings Excessive Low Excessive Excessive High Medium

Projectsmanager supervisor

Middlemanagement

Top management

Top management

Top management

Middlemanagement

Middlemanagement


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Classification Projects


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Type of Project/Industry

In-houseR&D

SmallConstruction

LargeConstruction

Aerospace/Defence

MIS Engineering

Project sponsor present

Yes No Yes Yes No No

Conflict intensity Low Low High High High Low

Cost control level Low Low High High Low Low

Level of planning/scheduling

Milestonesonly

Milestonesonly

Detailedplan

Detailedplan

Milestonesonly

Milestonesonly


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