BADM 318

Introduction to Project Management

What is Project Management?

• “The application of knowledge, skills, tools, and techniques to project activities in order to meet or exceed shareholder needs and expectations from a project” – Project Management Institute (PMI)

What is Project Management?

• “A method and a set of techniques based on the accepted principles of management used for planning, estimating, and controlling work activities to reach a desired end result on time, within budget, and according to specification.” - Weiss and Wysocki, 1992

What is Project Management?

• “Maintaining cost, schedule and technical performance on a project.” - Santarossa, 2004

What is Project Management?

• “A systematic, risk management approach to proactively guide projects to improve chances of success”

Originated from construction and engineering sectors

Increasingly adopted by other sectors such as video game industry…

…and the film industry.

Extremely important in the IT sector…

Can be very stressful!

It requires a unique blend of skills

1-5

A whole new sector is opening up…

Project junkie

“A growing band of professional gypsies whose careers consist of a series of independent projects”

PMIProjectMgmt.Institute

PMI

• More than 500,000 members

• 170 counties

• Most popular PM designation

• Great for international work

West Coast B.C. Project Management Association

• Established in 1979

• PMBOK written by B.C. member

• 700 members

PM Careers in B.C.

• Software development

• Construction

• Engineering

• Environmental

• Video game

• Film

Project characteristics

• An established objective• A defined life span with a beginning and

an end• Usually the involvement of several

departments or people• Typically, doing something that has never

been done before (unique)• Specific time, cost and performance

objectivesSource: Gray, 2004)

Established objective

Complex

Unique

Clear beginning…

… and end

On schedule

On budget

Requirements met

Involvement of several departments or people

Project examples

Project Management Tradeoffs4-1

General Project Phases

Programs versus Projects

• Program Defined– A series of coordinated, related, multiple projects that

continue over an extended time and are intended to achieve a goal.

– A higher-level group of projects targeted at a common goal.

– Example:• Project: completion of a required course in project

management.• Program: completion of all courses required for a

business major.

Comparison of Routine Work with Projects

TABLE 1.1

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

Wire-tag projects for GE and Wal-Mart

Integrated Management of Projects

FIGURE 1.3

Project Life Cycle

Traditional Approach Interactions

Traditional ApproachProject Phases

Risk Event Graph7-1

Traditional Project Phases for a Construction Project

Life Cycle Approach

Sgt. York Example

• More than one billion to build an air defense weapon that shot down a “port-a-potty”

Life cycle project phases usedby pharmaceutical industry

Life cycle

phased used by software industry

Project management Functions

Why do projects fail?

• List all the main reasons why you think projects fail

• Hint: Think of a large scale project (e.g. 2010 Olympics, RAV line) and think about possible reasons these projects could “fail”

Chaos Report – Exceeding Budget

Cost Overruns % of Responses Under 20% 15.5% 21 - 50% 31.5% 51 - 100% 29.6% 101 - 200% 10.2% 201 - 400% 8.8% Over 400% 4.4% Study of over 8,000 IT projects by Standish group

Over 50% of IT projects will go over budget by > 51%(e.g. $1.5 M instead of $1 M!)

Chaos Report- Exceeding schedule

Over 2/3rds of all IT projects will exceed their schedule by > 51%(e.g. 18 months instead of 12!)

Time Overruns % of Responses Under 20% 13.9% 21 - 50% 18.3% 51 - 100% 20.0% 101 - 200% 35.5% 201 - 400% 11.2% Over 400% 1.1%

Chaos Report- Features / functions not met

Less than 50% of all IT projects will deliver 75% or more of the featuresand functions that were promised

% of Features/Functions % of Responses Less Than 25% 4.6% 25 - 49% 27.2% 50 - 74% 21.8% 75 - 99% 39.1% 100% 7.3%

Interthink Consulting (2002)

• In survey of over 600 organizations, found that most companies don’t have an effective or consistent approach to managing projects

• Lots of inexperienced people managing projects but this is changing…

Capability Maturity Model (CMM)1-3

VSB

The Age of Project Management1-2

The Age of Project Management

Coplan and Company (2003)

•Inadequately defined requirements.•Failure to divide the IT project plan into specific measurable deliverables.•Vendor failure to fulfill RFP requirements.•Lack of risk and quality management plans.

Coplan and Company (2003)

•Negotiating team with no IT experience and implementation contracts.•Vendor staff with inadequate system implementation experience.•Pressure to convert, implement and accept new system too quickly.•Inadequate acceptance test.

Why Projects Fail SummaryItem Success Criteria Points

1 User Involvement 19 2 Executive Management Support 16 3 Clear Statement of Requirements 15 4 Proper Planning 11 5 Realistic Expectations 10 6 Smaller Project Milestones 9 7 Competent Staff 8 8 Ownership 6 9 Clear Vision & Objectives 3

10 Hard-Working, Focused Staff 3 TOTAL 100

Source: Standish Group (Chaos Report)

70% of success criteria rely on the management plan and 30% on people duringthe execution phase!

How big is Canadian PM sector?

• Write a list of all the major Canadian projects that are currently being implemented or that will soon be implemented

• What percentage of Canada’s GDP do you think uses project management methodology?

Project Management in Canada-- Construction industry by 2004 forecast

Sector % Share $ billion Residential 35 45,045 Non-residential 17 21,879 Engineering 32 41,184 Repair 15 19,305 Other 1 1,287 Total 100 128,701

Source: CCA, March 2004

Project Location Value, $ billion Status Syncrude Oil Sands Plant Expansion

Fort McMurray, Alberta 7.17 Under construction

Alaska Natural Gas Transportation Pipeline

Yukon, Northern B.C., Northern Alberta

6.00 Announced, project to commence in 2005

Road and Rail Expansion Montreal, Laval 6.00 Under construction Canadian Space Agency Centre

St. Hubert, Quebec 4.00 Under construction

Expansion of Pearson Airport

Toronto, Ontario 4.00 Under construction

Pollution Control Upgrades

Toronto, Ontario 3.18 Under construction, upgrades completed by 2010

Long Lake Project Oilsands Upgrading

Long Lake, Alberta 3.00 Announced, project to commence in 2004

Concord Pacific Place Redevelopment

Vancouver, BC 3.00 Under construction

Mackenzie Valley Natural Gas Pipeline

Mackenzie Valley, N.W.T., Northern Alberta

2.70 Announced

Voyageur Oilsands Development

Fort McMurray, Alberta 2.50 Announced, project to commence in 2004

PM is a key methodology used to manage at least 12% of the Canadian GDP!

Largest Canadian projects as of November, 2003

Management Plan -- “the road map” used to execute project

1. Define the project- Obtain approval to create a detailed project plan

2. Define the work3. Create a schedule baseline4. Create a budget baseline5. Create a technical performance baseline6. Obtain approval of the detailed project plan

Management Plan

Next most important thing that a management plan does is to create a cost, schedule and technical performance baseline to measure against during the project execution phase.

•Is the project ahead of behind schedule?•Is the project over or under budget?•Do the project deliverables meet the technical requirements?•Is the project living up to contractual requirements?