reinventing project management - harvard university · pdf filegrowth •team members ......

Reinventing Project Management

Part 1 slides

Operations

Projects

Agricultural society

Industrial society

Information society

Time Industries,Companies,

Society

The Increasing Share of Projects

The motivation

• The assumption:– Different projects are managed in different ways.

• The literature and the discipline assume:– “a project is a project is a project.”

• There is no accepted framework

• The need:– A framework to distinguish among projects – Practical guidelines on how to manage projects in different

The Questions

• How to Distinguish Among Projects – Dimensions?

• How to Classify Projects on Each Dimension?

• How to Manage Different Project Types?

• Is There More than One Way?

What Impacts Project Type?

Environment

Product

Project UCP NTCP

Novelty

Complexity

Technology

Uncertainty

Complexity

Uncertainty - at the moment ofproject initiation

Complexity -size, # of elements,variety, interconnectedness

Pace - available time frame

The UCP Model

Four Dimensions for Distinction Among Project Types

• Novelty – How new is the product to customers and users– Derivative, Platform, Breakthrough

• Technology – How much new technology is used– Low-tech, Medium-tech, High-tech, Super High-tech

• Complexity – How complex is the system and its subsystems– Assembly, System, Array

• Pace – How Critical is the Time frame– Regular, Fast/Competitive, Time-Critical, Blitz

The Project Diamond - Assessing a Project’s Risk/Benefit and Selecting the Right Management Approach

Array System Assembly

Complexity

Novelty

Technology

Derivative Platform Breakthrough

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Denver International Airport Project

Automatic Bag –Handling System

Airport Construction

Project

Impact onCustomer

Impact onTeam

Business & Direct Success

Project Success

• Meeting schedule

• Meeting budget

• Changes• Yield• Other

efficiencies

• Meeting requirements and specifications

• Benefit to customer

• Extent of use• Customer

satisfaction & loyalty

• Brand name recognition

• Team satisfaction

• Team morale• Skill

development• Team

member growth

• Team members’retention

• No burnout

• Sales• Profits• Market share• ROI, ROE• Cash flow• Service quality• Cycle-time• Organizational

measures• Regulations

approval

• New technology

• New market• New product

line• New core

competencies• New

organizational capabilities

Preparing for Future

Specific Success Measures

Efficiency

Short Medium Long

Timeframe

Business & Direct Success

Impact onTeam

Impact onCustomer

Efficiency

Success Dimensions

Project Success

Timeframes of Success Dimensions

Efficiency

Impact on Customer & Team

Business & Direct success

Uncertainty

Importance

Relative Importance of Success Dimensions is Project-Dependent

Low Medium High

The NTCP Framework

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

The NTCP Diamond

Classical Project Phases Modified to an Adaptive Iterative Approach

Definition Planning Execution Termination

Revise Definition

Revise Plans

From traditional to adaptive project management

Adaptive project managementTraditional project managementApproach

Getting business results, meeting multiple criteriaGetting the job done on time, on budget, and within requirements

Project goal

An organization and a process to achieve the expected goals and business results

A collection of activities that are executed as planned to meet the triple constraint

Project plan

Plan at outset and re-plan when needed Plan once at project initiationPlanning

Flexible, changing, adaptiveRigid, focused on initial planManagerial approach

Unpredictable, uncertain, nonlinear, complexPredictable, certain, linear, simpleProject work

Affects the project throughout its executionMinimal, detached after the project is launchedEnvironment effect

Identify changes in the environment, and adjust the plans accordingly

Identify deviations from plan, and put things back on track

Project control

Projects differAll projects are the sameDistinction

Adaptive approach; one size does not fit allOne size fits allManagement style

Requirements Planning Complete

Revise Requirements

Revise Plans

Entire Adaptive Iterative Approach

Specs Design, Build,Test

Revise Design

Freeze Requirements Freeze Design

Adaptive Approach Traditional PM

Efficiency

Impact on Customer & Team

Business & Direct success

Project Completion

Importance

Relative Importance of Success Dimensions - A Matter of Time

Critical Success Factors

Project MissionTop Management SupportProject PlanningProject ControlClient ConsultationSkillsPersonnel ManagementProject CommunicationClient AcceptanceTrouble Shooting

Clear and Early Product DefinitionDefined Product StrategyEarly Top Management InvolvementHigh Quality ProcessAdequate ResourcesIntegrated PlanningEmpowered and Communicating TeamVoice of the Customer

Generic Projects Product Development Projects

The FCS Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual styleDr = (Pl, HT, Sy, FC)Da = (Pl, MT, As, FC)

Novelty

Technology

Complexity

Later design freezeMore design cycles

Complex organizationFormality

Autonomy

Less market dataLater requirement freeze

The Impact of the NTCP Dimensions on Project Management

Potential riskExpected benefitDimension

Having difficulty predicting exact market needs; missing sales targets; attracting competitors to copy your ideas

Exploiting new market opportunities; leapfrogging competition; gaining first mover advantage

Novelty

Experiencing technology failure; lacking needed skills

Improving performance and functionalityTechnology

Having difficulty in coordinating and integratingBigger programs, bigger payoffsComplexity

Missing deadlines; making haphazard mistakesGaining early market introduction, mounting quick response

Benefits and risks of high NTCP levels

The World Trade Center Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

D = (Pl, MT, Ar, FC)

Part 2 slides

The “Toy Story” Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

D = (Pl, HT, Sy, -)

Definitions and examples of project novelty

ExamplesDefinitionLevel of project novelty

Developing a new version of a personal computer; upgrading a production line; streamlining organizational procedures

Extending or improving existing products or services

Derivative project

Building a new automobile generation; developing a new aircraft;creating a new generation of a cellular system

Developing and producing new generations of existing product lines or new types of services to existing markets and customers

Platform project

The first enterprise resource planning (ERP) package; the first photostatic copying machine (Xerox); the first Walkman; the Segway personal transportation system

Introducing a new concept, a new idea, or a new use of a product that customers have never seen before

Breakthrough project

The Segway Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Dr = (Br, HT, Sy, -)Da = (Pl, HT, Sy, -)

Required style

Actual style

Product novelty and project success: Expectations

Level of project novelty

BreakthroughPlatformDerivative

Success dimensions and possible failure

Efficiency is difficult to achieve and may not be critical (unless competitors work on the same idea); overruns likely

Time to market is important for competitive advantage

High efficiency is critical; no room for overruns

Efficiency

Outstanding improvements in customer’s life and work

Having high strategic impact on customers; retaining previous generation customers

Gaining additional customers and market segments

Impact on customer

Team members explore new fields and gain extensive experience in unknown markets

Team members gain technical and managerial experience in introducing new-generations.

Team members extend their experience in quick product modifications.

Impact on the team

Long-term, significant business success; may come later after initial products have been tested and refined

High strategic impact on the business; expectation of years of revenues and building of additional derivatives

Extends life of existing products; additional revenues and cash cow current products

Business and direct success

Creating new markets and establishing substantial leadership positions

Maintaining a strategic position in the market

Almost nonePreparation for the future

Impact of product novelty levels on project management

Level of product novelty

Breakthrough (Br)Platform (Pl)Derivative (De)

Managerial aspect

Unreliable market data; market needs unclear; no experience with similar products; customer base not defined

Extensive market research and careful analysis of previous generations, competitors, and market trends

Accurate market data exists from previous products and market research

Market data

Product definition based on intuition and trial and error; fast prototyping to obtain market feedback

Invest extensively in product definition, involve potential customers in process

Clear understanding of required cost, features, functionality, etc.

Product definition

Very late freeze of requirements, often after prototype feedback

Freeze requirements later, usually at mid–project

Early freeze of product requirements, usually before or immediately after project launch

Requirements freeze

Create customer attention through new and innovative marketing techniques; educate customers about potential of product; hidden customer needs; create industry standard

Create product image. Emphasize product advantages; differentiate from competitors

Emphasize product advantage in comparison to previous model; focus on existing as well as new customers

Marketing

Financial Middleware Software Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual styleDr = (Pl, HT, Sy, -)Da = (De, MT, Sy, -)

Denver International Airport Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Automatic Bag –Handling System Airport

Construction Project

Project types based on levels of technological uncertainty

Level of technological uncertainty

Super-High-TechHigh-TechMedium-TechLow-Tech

Key project technologies do not exist at the time of project initiation

Uses many new, recently developed, existing technologies

Mostly existing technologies; limited new technology or a new feature

Uses only existing, well-established, and mature technologies

Definitions

New, unproven concepts beyond the technological state of the art (e.g., Apollo moon landing program)

New systems in a fast-moving industry (e.g., computers, military systems)

Derivatives or improvements of products; new models in established industries (e.g., appliances)

Construction, road building, utilities, build-to-print

Examples

Project characteristics and technological uncertainty levels

Level of technological uncertainty

Super-High-TechHigh-TechMedium-TechLow-Tech

Variable

Need to develop key technologies during project effort; intermediate small-scale prototype

Considerable development and testing; prototypes usually used

Limited development; some testing

No development; no testing

Development, testing, and prototypes

Typically three cycles after the final technologies have been selected; late design freeze

At least two or three cycles; design freeze usually at midpoint during second or third quarter

One to two cycles; early design freeze

Only one cycle; design freeze before start of project execution

Design cycles and design freeze

Extensive peer reviews by technical expert teams critical to success

Technical reviews with experts in addition to formal progress reviews

Formal progress and status reviews; some technical reviews

Formal progress and status reviews

Project reviews

Highly flexible style; living with continuous change; “looking for trouble”

More flexible style; many changes are expected

Less firm style; readiness to accept some changes

Firm style; sticking to the initial plan

Management style and attitude

Many communication channels; informal interaction

Frequent communication through multiple channels; informal interaction

More frequent communication; some informal interaction

Mostly formal communication; scheduled meetings

Communication and interaction

Project manager with exceptional technical skills; highly skilled professionals

Manager with good technical skills; many professionals on project team

Manager with some technical skills; considerable proportion of academicians

Manager with good administrative skills

Project manager and project team

25–50%10–25%5-10%5%Contingent resources

Possible Time Ranges for Design Freeze, Number of Design Cycles,and Risk Areas for Project Outcomes

B: 1-2

C: 2-3

D: n+3

Project ScheduledCompletion

ProjectInitiation

Resources

Planned Resources

Possible time ranges for design freeze

Risk area

Legend:

A- Low-TechB- Medium-TechC- High-TechD- Super High-Tech

B: 1-2 – Number of design cycles

n – No. of cycles required to choose the final technologies

Low- and medium-tech versus high- and super-high-tech projects

Project type

High- and Super-High-TechLow- and Medium-Tech

Managerial issue

Flexible, ready to accept many changes and tolerate long periods of uncertainty

Rigid, no-nonsense, “get it done” approachManagerial style

Formal executive reviews plus technical peer reviews by experts

Formal, top management approval of major phase completion

Project reviews

Phase overlaps not recommendedPhase overlaps possibleSaving time by overlapping phases

Cost-plus; fixed-price is possible at a later stage of development

Fixed-priceBest contract type

Spiral developmentLinear developmentDevelopment approach

Risk management, systems engineering, quality management

Lower cost, on timeAdditional concerns

SR-71 Blackbird Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

D = (Pl, SHT, Sy, -)

Apollo Program

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

D = (Br, SHT, Ar, FC)

Space Shuttle

The Space Shuttle Program

1969 Initial proposal - to go to Mars in 1980sEncountered low priorities,Were asked to look for low-cost alternatives

1972 (August) Program approved; Shuttle onlyBased on known technologies -“success oriented”

1972 (November) Design freeze-configuration and technologies

1978 First flight scheduled1981 Actual first flight - 60% budget overrun1982 System declared operational1986 Challenger accident2003 Columbia accident

Space Shuttle ProgramInitial Uncertainties

First two-medium space vehicleFirst reusable space vehicleLiquid fuel engines and an external tankHuge 75 Ton glider5000 Miles glide from reentry to landingFirst orbital flight with a live crewNo crew escape system

The Space Shuttle Program

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual style

Dr = (Br, SHT, Sy, Re)Da = (Pl, HT, Sy, FC)

Space ShuttleProject Management Style

Actual Style Alternative Style

Success oriented Look for troubleOff-the-shelf items Alternative technologiesEarly configuration and Late freeze; Build a

design freeze small-scale prototypeLow flexibility High flexibilityEarly operational Extended developmentLimited communication Intensive communication

Type C Type DHigh-Tech Super High-Tech

The Ford 2000 Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

D = (Pl, HT, Sy, -)

The three levels of project complexity

Examples of projectsProduct complexityProject complexity

Development of a PDA, Post-it notes, design of a single service

Material, component, subsystem, assemblyAssembly project

Missile development, new computer development, new automobile model, a single building construction, restructuring a production plant

System, platform of systemsSystem project

English Channel tunnel, national missile defense system, new neighborhood construction, nationwide cellular system

Array, system of systemsArray project

The Chunnel Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual styleDr = (Pl, MT, Ar, -)Da = (Pl, MT, Sy, -)

The Harmony Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

D = (Pl, HT, Sy, FC)

Mars Climate Orbiter Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual styleDr = (Br, HT, Sy, TC)Da = (Pl, MT, As, TC)

Four levels of pace

BlitzTime-CriticalFast/CompetitiveRegular

Crisis projects; utmost urgency; project should be completed as soon as possible

Meeting time goal is critical for project success; any delay means project failure

Project completion on time is important for company’s competitive advantage and/or the organization’s leadership position

Time not critical to organizational success

Definitions

War; fast response to natural disasters; fast response to business-related surprises

Projects with a definite deadline or a window of opportunity; space launch restricted by a time window; Y2K

Business-related projects; new product introduction, new plant construction in response to market growth

Public works, some government initiatives, some internal projects

Examples

The Y2K Case Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual style

Dr = (Pl, MT, Sy, TC)Da = (Pl, MT, Sy, Bl)

Part 3 slides

Benefit and Opportunity

Risk or DifficultyLow

High ApproveImmediately

Reject Immediately

Further Consideration

Risk and Benefit Assessment Matrix

Market Watch Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Blitz D = (Br, MT, Sy, FC)

Innovation Categories and Project Types

IncrementalMarket Innovation

IncrementalTechnological Innovation

RadicalTechnological Innovation

Modular Innovation

Architectural Innovation

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

RadicalMarket Innovation

Low-end demand

High-end demand

Sustaining

progress

Disruptive progress

Manage by Platform Projects

Manage by Breakthrough Projects

The Innovator’s Dilemma and Project ManagementAdopted from Clayton M. Christensen, the Innovator’s Dilemma, 1997 and modified by the authors

The Evolution of Project Types along the Product Life-cycle

Novelty Breakthrough Platform Derivative DerivativePlatform

Technology Medium to Medium- Medium- Medium toSuper-high-tech tech tech Low-tech

Goal Strategic Strategic Operational Operational

Adopted from Geoffrey A. Moore, Crossing the chasm, 1991 and modified by the authors

The Microwave Oven Patent Filed

Original Microwave Oven Patent by Doctor Percy L. Spencer, US Patent No. 02495429, Filed Jan. 24, 1950

The first Microwave Oven

Characteristics of projects for various customers

Customer type

Government/Public (B2G)Industrial/Business (B2B)Consumer (B2C)

Characteristic

Hubble telescope, FCS, Army communication

AS/400, B777, ERP systemsMP3 player, PC, carsExamples of products

Impact on public goals and needsImpact on businessImpact on quality of lifeValue to customer

Long-term relationshipIndustry leadership, preferred provider

High volume, market shareProducer’s objective

High focus on performanceHigh focus on time and cost High focus on time, cost, and quality

Project focus

Defined by or with customerContinuous customer involvementDefined by marketing; perceived customer needs, market research

Product definition

Defined by or with customerDefined by producer with customerDefined by producerProject scope: work, goals, deliverables

Contracted project, obligations to customer

Either external contract or internal commitment

No contract, internal commitment

Contractual obligations

Intense customer involvement; often customer representative on the team

Sometimes direct customer involvement

No direct involvement; focus groups or market trials

Customer involvement

Financed by customer according to contract

Internally financed, or contracted by customer

Internally financedFinancing

Competition for bids; focused on major decision makers

Industry image creationMass marketing, advertisement; brand management;

Marketing

Reliability focused on safety Reliability may be traded off for timely delivery

High reliability requiredReliability

Training, documentation, on-call support

Service availabilityProduct support

Wire and Cable Coating Project

Complexity

Novelty

Technology

Super-High Tech

High-Tech

Medium-Tech

Low-Tech

Regular

Fast/ Competitive

Time-Critical

Required style

Actual style

Dr = (Br, HT, Sy, Bl)Da = (Br, HT, As, Bl)

Project Management -The Two + One Processes

When are you shooting?

Technical Process

Product Definition Process

Managerial Process

Classical Project Phases Modified to an Adaptive Iterative Approach

Definition Planning Execution Termination

Revise Definition

Revise Plans

The Impact of the NTCP Dimensions on Project Management

Novelty

Technology

Complexity

Later design freezeMore design cycles

Complex organizationFormality

Autonomy

Less market dataLater requirement freeze

A Framework for Adaptation

Category Project Types PM Impact

Strategic Goal Strategic, Operational

Customer External, Internal

Combined Business Objective

NPD, Product Improvement, Maintenance, Infrastructure,

Research

Novelty Derivative, Platform, Breakthrough

Complexity Assembly, System, Array

Technology Low-tech, Medium-tech, High-tech, Super High-tech

Pace Regular, Fast/Competitive, Time-Critical, Blitz

Reducing Requirements and Design Uncertainty

Project Start

Levels Determined by Novelty, Technology,And Other Uncertainties

Uncertainty of Technical Specs and Design

Ideal World

Real World

RequirementsFreeze

Specifications and DesignFreeze

Uncertainty of Requirements

Requirements Planning Complete

Revise Requirements

Revise Plans

Entire Adaptive Iterative Approach

Specs Design, Build,Test

Revise Design

Freeze Requirements Freeze Design

Adaptive Approach Traditional PM

Iterative Process of Requirements and Design Freeze

Product Requirements Design, Build, Test Product Prototype Completefinal productTechnical Specifications

Market Research and/or Market Testing

Change Until Requirements Freeze Specifications and Design Freeze

# of Design Cycles

Initial Market Data

# of Requirements Change Cycles

Adaptive project management

Traditional project management

Typical project activities across project phases

DetailsActivityPhaseMarket/customer identification; Customer needMarket definition

Define the expected business objective Business objective

Product description; Product requirementsProduct definition

Statement of work (scope); duration; budget; PM and teamProject definition

Categorize a project based on strategic or operational, internal or external user, novelty, technology, complexity, pace

Identifying project type

Define management’s expectation on relevant success dimensionsSuccess and failure criteria

Definition

Decide how each project category will affect project organization, processes, plans, activities, and team

Impact of type on project management

Break scope into detailed work packages and activitiesWBS

Project team structureOrganization

Major phases, gates, and milestonesProject process plan

Detailed network and timing of activitiesSchedule

Detailed cost of project based on WBS items Budget

Risk identification and mitigation plan based on project type Risk management

Timing and duration of integration activitiesIntegration plan

Subcontracting and vendor management planProcurement

Reporting structure and meeting scheduleCommunication

Team development and training; Team motivation Human resources

Initial technical specifications; product design and testing planProduct creation plan

Planning

Typical project activities across project phases (cont.)

DetailsActivityPhase

Refine product requirementsFreeze product requirements

Product requirements

Product designPrototype building and testingAdditional design cycles (redesign, rebuild, retest)Freeze product designProduct building and testing

Product building

Progress and status of budget, time, and activities performedProject monitoring

Update plans and make changesProject replanning

Execution

Training materials and meansCustomer preparedness

Product introduction planCommercialization

Project summary reportNext generation planning

Project wrap-up

Termination

Risk Assessment

Master plan – Entire project

Detailed work plans – Weeks

Medium detail plans – 4 to 6 Months

The “Rolling Wave” Planning Concept

Outsourcing Work Packages

Possible Outsourcing Regions

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