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© Eric Woodcock 2020ZAVANAK.com

PM101: Lecture 3Project selection

1


The typical project life cycle

Definition

Planning

Decision

Production

Delivery

Progression

Deciding what to do and why

Working out how to do it, who will do it and when

Getting approval to go ahead

Creating and testing the product or service, controlling progress

Getting the customer to accept it

Closing down, and learning for next time

2


The evolving portfolio

a

In Definition

In Production

Output in use

h

dcb

gfe

2020

In Definition

In Production

Output in use

dc

ba

h

gf

kji

2021

e

In Definition

In Production

Output in use

dcb

n

kih

ml

g

2022

j

f

3


Project portfolios can be badly managed

• Project activity is unfocused

• No link with overall strategy

• Pet projects

• Chasing after competitors

• Overstretched resources

• Spending lots on contractors

• Loads of day to day jobs

• Projects over-run

New project demands

Project mainten-ance

Pro

ject

wo

rk d

ays

Available project

time

2,500 days

6,6007,400

5,100

Year 1 Year 2 Year 3

4

Wheelwright, S. and Clark, K. (1992) ‘Creating project plans to focus product development’, Harvard Business Review, March-April 1992.


Selecting what is in the project portfolio

Selection process

Individual project

justification

Project portfolio

Strategy down

Candidate projects

Candidate projects

Initiative up

‘Project council’

Meredith, J. & Mantel, S. (2012). Project management. Hoboken NJ: Wiley, p 67. Photos: Public domain

5


Not all projects are voluntary6

We choose to do this:• Introduce a new product or service• Improve our productivity• Enter a new field of activity• Reorganise

We have to do this:• Implement new rules and regulations• Act on a legally enforced instruction• Fix significant problems• Deal with a crisis

PROJECT: Build technically advanced Millennium Bridge across the River Thames

PROJECT: Fix uncomfortable swaying due to unforeseen behaviour of bridge under pedestrians


The strategic relevance of projects7

Wheelwright, S. and Clark, K. (1992) ‘Creating project plans to focus product development’, Harvard Business Review, March-April 1992.

Breakthrough

Invention. Brand new concepts and ideas.

Research and development. Entirely

novel product or service.

Next generation model. Self-driving car. Fuel cell

propulsion.

Electric version of current model. Sports

car based on next generation model.

Innovation. Significant extension of product or

service. Major step forward. Basis for different versions.

Estate car version of current model. Facelift

with revised styling.

Improvement. Updates with additional features. Refreshed appearance.

Adaptations for different markets.

Platform DerivativeProject type

Characteristics

Car maker

30% 50% 20%Share of

project effort


How challenging will the project be?

A project challenge is an aspect of the project that will require special technical, financial, managerial or other skills in order to achieve the desired benefits.

Is the very idea of the project feasible enough for us to consider doing?

8


Political

Legal

Economic

Social

Environmental Technological

Project challenges

PESTEL

9


Project context: the Bay Gateway

Political

Legal

Economic

Social

Environmental Technological

10


A more comprehensive challenges model

Shenhar, A. & Dvir, D. (2007). Reinventing project management, Boston, US: Harvard Business School Press

Scale: What is the project size relative to what we usually do?

Practical: How novel, technically advanced and complex is it?

People: How many stakeholders are there, what’s their attitude, what are cultural aspects?

Relationships: What is the relative power of the client, partners, suppliers and external bodies?

Physical: What are the limits on time scale and cost, and how spread out is the work?

Societal: What pressures come from regulations, being sustainable, and the media?

Knowledge: Can we use existing knowledge through to do we have to invent everything?

Rate each dimension on a 1 to 5

scale

11


Different projects display different challenges12

Shakespeare’s Globe London office tower Sydney Opera House


Who should carry out the project?

Does the customer have the necessary…

skills

organisation

equipment

time

funding

scale

… to carry out the project?

P

P

P

P

P

P

Internal project

O

O

O

O

O

O

Project firm

P

P

O

O

?

?

Hybrid

13


Project firmsA project firm is a commercial organisation that designs and carries out projects as their principal business.

• The nature of these projects will depend on the fields and sectors it specialises in.

• A high proportion of staff consists of expert practitioners in those fields and sectors.

They operate in fields like:

• Building and construction – Bechtel, Bouygues

• Facilities management – Infosys, Serco

• Information technology systems – DXC Technology, IBM Global Services, Wipro

• Management consulting – Accenture, Bain, McKinsey

• New product development – IDEO, Ricardo

• Organisational change – Capgemini, Frazer-Nash

• Project and programme management – Turner and Townsend

14


The customer project

Leaving a project entirely to a project firm (supplier) is a major risk.

SUPPLIER PROJECT Organise

development

Conduct project work

Get approval for project

Produce output

Hand over output

CUSTOMER PROJECT

Co-ordinate requirements

Make facilities available as needed

Make right staff available

Organise end user testing

Make organisation ready to accept output

The customer should run an internal project in parallel to ensure nothing stands in the way of progress and the organisation is ready for the output.

15


Project selection: core ideas16

An organisation will have a portfolio of projects which evolves over time.

It needs a process to select which are the best projects to enter the portfolio.

Not all projects are voluntary; some the organisation is obliged to do.

A portfolio ideally consists of a balance of breakthrough, platform and derivative projects.

The organisation has to consider how challenging any candidate project will be.

It may choose a project firm to carry out some or all of the work.

In that case is must have a customer project to mirror the supplier project in order to facilitate the project.

See Zavanak pages Selecting the right project and Project firms.

1 pm101: lecture 3 - wordpress.com · zavanak.com © eric woodcock 2020 the evolving portfolio a in...

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