1. pm introduction

Prof. Sujata Rao 8-12-2013

1. Introduction

Projects ..? ? ? ?Gautam is planning to buy a ipad.A steel Plant is considering to build a

furnaceAn insurance company is planning to

automate its information processing .Government is planning to build dam

over Ganges .All of these involve money to be spent – “ Capital Expenditure”

03/05/232 P M - Introduction

Capital Budgeting - Invest or Not ..??

Decision as to, whether or not to invest money in long term projects - like

installing a machinery or creating additional capacities to manufacture a part which is at present purchased from outside.

A Process of planning capital Expenditure which is to be made to maximizs long term profitability of an Organisation.


Decision Making Levels


Operating Administrative

Strategic

Minor Resources

Moderate Resource

Major Resource

Short Term Medium Term Long TermEx. Minor Office Equipments

Moderate Diversification Projects

Projects Analysis1. Market Analysis - 2. Technical Analysis3. Financial Analysis4. Economic Analysis5. Environmental (Ecological Analysis)


PM INVOLVES BALANCING OF COMPETING PM INVOLVES BALANCING OF COMPETING DEMANDS AMONGDEMANDS AMONG

SCOPE, TIME, COST SCOPE, TIME, COST AND QUALITYAND QUALITY

T I M ET I M E

C O S

C O S

TT

QUALITY QUALITY &&

PERFORMANCEPERFORMANCE

PROJECT SCOPEPROJECT SCOPEFOR STAKEHOLDERS WITH FOR STAKEHOLDERS WITH DIFFERENT NEEDS & DIFFERENT NEEDS & EXPECTATIONSEXPECTATIONS(Identified & Unidentified (Identified & Unidentified Requirements)Requirements)

P M - Introduction

INTRODUCTIO77N TO PM 7

•Annual budgeting / auditing exercisesAnnual budgeting / auditing exercises

•Introduction of new systems (ISO 9000)Introduction of new systems (ISO 9000)

•Organizational restructuringOrganizational restructuring

•Software development & implementationSoftware development & implementation

•Development of new productDevelopment of new product

•Campaign for new product launchCampaign for new product launch

•Organizing AGM / sales conferenceOrganizing AGM / sales conference

Some typical examples are:Some typical examples are:PROJECTIZING THE ORGANIZATIONPROJECTIZING THE ORGANIZATION

8

PROJECTS ENVIRONMENTPROJECTS ENVIRONMENTTIMETIME

TECHNOLOGYTECHNOLOGY

CULTURAL SYSTEMCULTURAL SYSTEM

SOCIAL SYSTEMSOCIAL SYSTEM

POLITICAL SYSTEMPOLITICAL SYSTEM

REGULATORY AND LEGAL SYSTEMREGULATORY AND LEGAL SYSTEM

ECONOMIC SYSTEMECONOMIC SYSTEM

ORGANISATIONAL SYSTEM.ORGANISATIONAL SYSTEM.

9

RESOURCES, RESOURCES,

BUDGETS,BUDGETS,

METHODS AND TOOLS OF PROJECT METHODS AND TOOLS OF PROJECT MANAGEMENT MANAGEMENT

DEPEND ON ABOVE FACTORS AND DEPEND ON ABOVE FACTORS AND CHANGE ACCORDINGLYCHANGE ACCORDINGLY..

10

CURRENT PROJECT ENVIRONMENTCURRENT PROJECT ENVIRONMENT

INCREASING GLOBAL COMPETITIONINCREASING GLOBAL COMPETITIONRAPID TECHNOLOGICAL CHANGERAPID TECHNOLOGICAL CHANGERAPID PRODUCT OBSOLESCENCE RATERAPID PRODUCT OBSOLESCENCE RATEORGANISATIONAL DOWNSIZINGORGANISATIONAL DOWNSIZINGBUSINESS RE-ENGINEERINGBUSINESS RE-ENGINEERINGEMPOWERMENTEMPOWERMENTFOCUS ON QUALITY & CONTINUOUSFOCUS ON QUALITY & CONTINUOUS IMPROVEMENTIMPROVEMENTINFORMATION DELUGEINFORMATION DELUGEFASTER COMMUNICATIONFASTER COMMUNICATIONINTER-ORGANISATIONAL SYSTEMSINTER-ORGANISATIONAL SYSTEMS

11

• PROJECTS ARE GIVENPROJECTS ARE GIVEN MORE IMPORTANCE BY MORE IMPORTANCE BY THE MANAGEMENT FOR SURVIVAL OF THE THE MANAGEMENT FOR SURVIVAL OF THE OGANISATIONOGANISATION

• INCREASING NEED FELT TO DO PROJECTS RIGHT INCREASING NEED FELT TO DO PROJECTS RIGHT & SUCCESSFUL THE FIRST TIME& SUCCESSFUL THE FIRST TIME

• MORE LIMITATIONS ON RESOURCES AND LESSER MORE LIMITATIONS ON RESOURCES AND LESSER ORGANISATIONAL SUPPORTORGANISATIONAL SUPPORT

• INCREASING PRESSURE ON PROJECT INCREASING PRESSURE ON PROJECT MANAGEMENT TO ACHIEVE QUICK RESULTSMANAGEMENT TO ACHIEVE QUICK RESULTS

IMPACT OF CURRENT PROJECT IMPACT OF CURRENT PROJECT ENVIRONMENT ON ORGANIZATIONSENVIRONMENT ON ORGANIZATIONS

12

• PROJECTS ARE TENDING TO GET MORE PROJECTS ARE TENDING TO GET MORE COMPLEX & LARGE TO HANDLECOMPLEX & LARGE TO HANDLE

• PROJECTS TO BE COMPLETED AHEAD OF PROJECTS TO BE COMPLETED AHEAD OF SCHEDULE, ALWAYS.SCHEDULE, ALWAYS.

• NEED MORE FLEXIBILITY IN DEFINING SCOPE, NEED MORE FLEXIBILITY IN DEFINING SCOPE, PLANNING & EXECUTION TO EXPAND PROJECT PLANNING & EXECUTION TO EXPAND PROJECT BENEFITS AND IMPACTBENEFITS AND IMPACT

IMPACT OF CURRENT ENVIRONMENT IMPACT OF CURRENT ENVIRONMENT ON PROJECTSON PROJECTS

13

INFORMATION SHARING-Not just possessing

•PROCESS ORIENTATION -Not system orientation

• NON-LINEAR THINKING - As opposed to linearity

ADOPTING PROJECT MINDSETADOPTING PROJECT MINDSET

14

PROJECT MANAGEMENT INSTITUTE (PMI) - PROJECT MANAGEMENT INSTITUTE (PMI) - USA USA (PMP Certification)(PMP Certification)

INTERNATIONAL PROJECT MANAGEMENT INTERNATIONAL PROJECT MANAGEMENT ASSOCIATES (IPMA) ASSOCIATES (IPMA) Switzerland Switzerland

(QPMP Certification)(QPMP Certification)

INTERNATIONAL RECOGNITIONINTERNATIONAL RECOGNITION

15

•POST GRADUATE QUALIFICATIONPOST GRADUATE QUALIFICATIONAmerican & European universities American & European universities offer the subject specializationoffer the subject specialization

•INTERNATIONAL STANDARDINTERNATIONAL STANDARDISO 10006 – Draft released as theISO 10006 – Draft released as the

““Guidelines to Quality in Project Guidelines to Quality in Project Management”Management”

INTERNATIONAL RECOGNITIONINTERNATIONAL RECOGNITION

16

PROJECT MANAGEMENT

PROJECT CLOSUREPROJECT IMPLEMENTATIONPROJECT PLANNING

PROJECT SCHEDULING

SCOPEDEFINITION

INVESTMENTDECISION

PROJECT BUDGETING

PROJECT ENVIRONMENT

IDEAGENERATION

RISKASSESSMENT

FEASIBILITY &APPRAISAL

NETWORKTECHNIQUES

GANTT CHARTS

•Market•Technical•Financial•Economic•Ecological

•PERT•CPM•CRITICAL CHAIN•Specifications

•Deliverables•Time frame•Organization•Budgets•Wbs / cbs

•Activity based costing•Cost breakdown•Cash flow•Earned value

•Sensitivity•Scenario•Simulation•Decision tree

1717

PROJECT MANAGEMENTPROJECT MANAGEMENT

PROJECT CLOSUREPROJECT CLOSUREPROJECT IMPLEMENTATIONPROJECT IMPLEMENTATIONPROJECT PLANNINGPROJECT PLANNING

PROJECT PROJECT CONTROLCONTROL

PROGRESSPROGRESSREPORTINGREPORTING

PROJECTPROJECTMONITORINGMONITORING

COST COST TILL DATETILL DATE

SCHEDULESCHEDULEUPDATEUPDATE

SCOPESCOPECHANGECHANGE

AD-HOCAD-HOCREPORTSREPORTS

PERIODICPERIODICREPORTSREPORTS

ACTUAL STATUSACTUAL STATUS•Activity Activity Completion %Completion %•Critical pathCritical path•DelaysDelays•Project Project completion %completion %

•PeriodicityPeriodicity•DetailingDetailing•SummarySummary•DistributionDistribution

•Control actionsControl actions•Revised scopeRevised scope•Revised scheduleRevised schedule•Revised budgetRevised budget

•CommittedCommitted•IncurredIncurred•Balance budgetBalance budget

•Current statusCurrent status•Time to completeTime to complete•Cost to completeCost to complete•Earned valueEarned value

•Special studiesSpecial studies•Milestone reportsMilestone reports

•Discrepancy report Discrepancy report •Hand over reportHand over report•DocumentationDocumentation•Failure analysisFailure analysis•LearningsLearnings

18

PROJECT MANAGEMENT KNOWLEDGE PROJECT MANAGEMENT KNOWLEDGE AREAS RECOGNIZED BY PMIAREAS RECOGNIZED BY PMI

1.1. Project Integration ManagementProject Integration Management2.2. Project Scope ManagementProject Scope Management3.3. Project Time ManagementProject Time Management4.4. Project Cost ManagementProject Cost Management5.5. Project Quality ManagementProject Quality Management6.6. Project Human Resource ManagementProject Human Resource Management7.7. Project Communications ManagementProject Communications Management8.8. Project Risk ManagementProject Risk Management9.9. Project Procurement ManagementProject Procurement Management

19

Project Management Framework

TT

20

9 Project Management Knowledge AreasKnowledge areas describe the key

competencies that project managers must develop4 core knowledge areas lead to specific project

objectives (scope, time, cost, and quality)4 facilitating knowledge areas are the means

through which the project objectives are achieved (human resources, communication, risk, and procurement management

1 knowledge area (project integration management) affects and is affected by all of the other knowledge areas

21

Project Management Tools and TechniquesProject management tools and

techniques assist project managers and their teams in various aspects of project management

Specific Tools includeProject Charter and WBS (scope)Gantt charts, PERT charts, critical path analysis (time)

Cost estimates and Earned Value Analysis (cost)

Ideas from Outside the Company

Inventors: Advertise for inventors to submit proposals.

Patents: Official journals / gazettes of the government.

Licensing: Licensed manufacture of product through license holder.

Joint Ventures : Equity participation by inventor / patent holder / license holder

Acquisitions : To acquire a company with product

Ideas from Outside the Company

Suppliers: Raw material suppliers interested in developing new markets for their product approach with new ideas utilising their merchandise.

Student projects: Co-operation of universities, business schools & polytechnics to generate ideas.

Sponsored research: At universities & B. Schools.

Consultants: To examine client company in detail and suggest.

Advertising agency: Creative people in agency can be used for idea generation.

Product Oriented Techniques Product checklists: Questions relating to product -

Ingredients, size, pack, presentation, price / value relationship, usage, product combination etc. are examined to give a fresh perspective of the product.

Attribute listing: Physical aspects of product are considered.

Value Analysis: Cost reduction - cost related to attribute.

Morphological analysis : Detail examination of existing product parameters and their rearrangement in different combinations (e.g. Size, shape, material, closure etc. for packaging attributes)

Product Oriented Techniques Scimitar Technique: Three-dimensional matrix is

constructed to identify gaps in the markets rather than new products. The three axes represent the existing raw materials company uses; the existing process it applies to those materials and the markets it sells its products in. Blocks are put inside the model to represent all the products company is already making so creative techniques can be used to find products to fill the gaps.

Letters of Complaint: Gives suggestions of new needs.

Recipe books & Menu cards: for food products to know popular dishes that could be branded.

Creativity Oriented Techniques Brainstorming: Technique rests on four basic principles -

Deferment of judgement: Criticism not allowed during presentation. Quantity is the aim: More ideas the better. All ideas are welcome : However wild Combinations and improvements are sought: through group chain

reaction. Synectics: Team approach to creative problem solving; drawing people

together from cross-section of organisation. Psychological mechanisms that occur during the creative process are usually below the level of consciousness and the synectics group situation forces each participant to verbalise his thoughts and feelings about the problem in hand. As a result, elements of creative process can be brought into the open where they can be identified and analysed.

Lateral Thinking: An alternative to vertical thinking i.e. careful logical analysis. With lateral thinking, mind tends to arrive at ideas through exploring various ways of looking at things, consequently restructuring existing patterns of information in mind. The process needs to be started deliberately since mind is conditioned to vertical thinking.

Consumer Oriented Techniques

Group Discussions: Consumer group discussions.Consumer Panels: Dissatisfaction panels or focus

groupsPseudo Product Tests: To identify perceived

differentiation in products.Depth Interviews: Problem areas revealed by groups

can be explored further.Activity Analysis: Also known as function analysis or

action study. A detail analysis of consumer behaviour and action in the areas of interest to the researcher.

Past Consumer Research: Usage and attitude studies, product tests, advertisement tests, group discussion reports etc. published from time to time.

Competition Oriented Techniques

The me-too approach: To look where a single brand has more than 70% market share and enter with a viable product differentiation.

Trade Opinion Surveys: Surveys and group discussions among trade buyers / store managers.

Market Analysis: Analysing market data gathered at planning stage.

Store visits: Opportunity may arise to copy a competitor in a possible growth market, pinpoint a neglected market segment or introduce a new line based on existing concept.

Other Specialised Techniques

Segmentation Analysis: The concept of market segmentation refers to the notion that a market for a product is composed of subgroups, each of which has different needs, and each of which therefore, possesses homogeneous purchase behaviour.

Technological Forecasting: Attempts at predicting future technologies and their implications.

Alfred Sheinwold

"Learn all you can from the mistakes of others.

You won't have time to make them all yourself."


1. pm introduction

Documents