chapter 2 - project integration management

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Project Integration Management

Author

Pankaj Sharma

Project Management Program

Based onPMBOKGuide IV Edition

PMI, PMP, CAPM, PgMP, PMI-RMP, PMI-SP and PMBOK are registeredmarks of Project Management Institute, Inc.


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After the completion of this chapter, the learner

will be able to:

List the various processes of Project Integration Management

Describe the process of Develop Project Charter

Describe the process of Develop project plan

Describe the process of Direct And Manage Project Execution.

Describe the process of Monitor and Control Project Work

Describe the process of Perform Integrated Change Control

Describe the process of Close Project Or Phase

Explain the various project selection methods

Explain the components of a project management plan

Learning Objectives


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Project Integration Management Overview

Develop a Project Charter

Project Selection Methods

Define High Level Project Scope

Tailor the Processes Required By The Project

Develop Project Management Plan

Creating the Project Deliverables

Directing and Manage Project Execution

Monitor and Control Project Work Close a Project Or Phase

Project Integration Management: Topics


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Definition as per PMBOK Guide

Project Integration Management includes the processes andactivities needed to identify, define, combine, unify, and

coordinate the various processes and project management

activities within the Project management process Groups.

Project Integration Management: Define


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1 Develop Project Charter

2 Develop Project Management Plan

3 Direct and Manage Project Execution

4 Monitor and Control Project Work

5 Perform Integrated Change Control

6 Close Project or Phase



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1 Develop Project Charter

2 Develop Project Management Plan

3 Direct and Manage Project Execution

4 Monitor and Control Project Work

5 Perform Integrated Change Control

6 Close Project or Phase


Initiating

Planning

Executing

MonitoringandControlling

Closing


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Develop Project Charter WHY we should do it?

Develop Project Management Plan HOW we will do this?

Direct and Manage Project

Execution

Doing it

Monitor and Control Project Work Is it going Well?

Perform Integrated Change Control Is this request Worth doing?

Close Project or Phase Have we Delivered everything?

Topics: Project Integration Management




The process of developing a document that formally authorizesa project or a phase and documenting initial requirements that

satisfy the stakeholder's needs and expectations.

Develop Project Charter: Define



Project Charter

The approved Project Charter formally initiates a project.

The Project Manager should be preferably assigned during creationof the Project Charter.

Project Charter gives the project manager authority to spend andcommit corporate resources

It provides high-level requirements for the project.

Develop Project Charter



Develop Project Charter

Inputs

Project statement of work

Business case

Contract

Enterprise environmental factors

Organization process assets

Outputs

Project Charter

Tools and Techniques

Expert Judgment




Non Numeric Method

Sacred cow

Operating necessity

Murder Board

Competitive necessity



Benefit Measurement Model (also calledComparative

approach)

Payback Period

Cost Benefit Analysis

Scoring Models

Net Present Value (NPV) Internal Rate of Return (IRR)

Mathematical Models (also called Constrained

Optimization) Use linear, dynamic, non-linear, multi-objective programming tosolve problem




Mathematical Models

Involves complex mathematical formulas to predict successrate

Also called as Constrained Optimization

Use linear, dynamic, non-linear, multi-objectiveprogramming to solve problem




Payback period the amount of time to recover your cost.It compares the initial investment to the cash inflowsexpected over the life of the product.

For example, Initial investment on a project is Rs. 4,00,000, Expectedcash inflows: Rs. 50,000 per quarter for first two years, Rs. 100,000 perquarter thereafter.

What is the payback period?

Cash inflows = Rs. 50,000 x 4 (quarters in a year) = Rs. 2, 00,000 peryear for first two years. Hence, year 1 inflow = Rs. 2, 00,000, year 2 inflow

= Rs. 2, 00,000. Total Rs. 4, 00,000 in 2 years So payback is reached in 2 years.




Benefit Cost Ratio (BCR) or profitability Index . This is theratio of project benefit and the project cost.

BCR = Revenue / Cost

Select the project with a higher BCR




Present Value (PV) is the expected future cash flowsexpressed in todays monetary value

PV = FV / (1+r) n

For example, Calculate the Present Value of $ 100,000 receivedthree years from now. The interest rate is 10 percent.

PV = 100000 / (1+10/100)3 = $ 75,131

Net Present value (NPV) is the sum total of the PresentValue of Cash Inflows Cash Outflows




Internal Rate of Return (IRR): The rate of interest atwhich the revenues and costs are equal.

Select the project with a higher IRR.

Return On Investment (ROI) A return ratio thatcompares the net benefits of a project/ product, verses itstotal cost.

ROI = Operating Income / Investments




Net Present value (NPV) is the sum total of the Present Value of

Cash Inflows Cash Outflows

NPV of the Project is 353-291 = 62


TIME PERIOD INCOME/REVENUE PRESENT VALUE AT10% INT RATE

COSTS PRESENT VALUE AT10% INT RATE

0 0 0 200 2001 50 45 100 912 100 83 0 03 300 225 0 0TOTAL 353 291



Method Project A Project B Which One?

Scoring Model 17 20 B

Payback Period 24 Months 25 months A

Benefit Cost

Ratio

3.5 4.5 B

Net PresentValue (NPV)

95,000 80,000 A

IRR 9.5% 11.5% B

Exercise 1: Which Project Will You Select




Develop Project Management Plan is the process of

documenting the actions necessary to define, prepare,

integrate, and coordinate all subsidiary plans.

Develop Project Management Plan : Define



Develop Project Management Plan

Inputs

Project charter

Outputs from planning processes


Organizational process assets

Outputs

Project management plan


Expert Judgment


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Requirements Management plan

Project scope management plan Schedule management plan

Cost management plan

Quality management plan

Process improvement plan

Staffing management plan

Communication management plan

Risk management plan

Procurement management plan

Components of Project Management Plan


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Direct and manage Project Execution is the process of

performing the work defined in the project management

plan to achieve the project's objectives.

Direct & Manage Project Execution: Define


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Direct & Manage Project Execution

Inputs

Project management plan Approved change requests



Outputs

Deliverables

Work performance information

Change requests

Project management plan updates

Project document updates


Expert judgment

Project management information system


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Monitor and Control project Work is the process of tracking,

reviewing, and regulating the progress to meet the

performance objectives defined in the project management

plan.

Monitor & Control Project Work: Define


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Monitor & Control Project Work

Inputs

Project management plan Performance reports



Outputs

Change requests


Project documented updates


Expert judgment


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Perform Integrated Change Control is the process of reviewing

all change requests, approving changes and managing changes

to the deliverables, organizational assets, project documents,

and the project management plan.

Perform Integrated Change Control: Define

f d h l


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Change Control Systems

Every documented change request must be either approved orrejected by an authorized person.

Some changes require approval by the Change Control Board(CCB).

Any approved changes may required adjusting the scope, time,and resource requirements

Perform Integrated Change Control

P f I d Ch C l


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Configuration Management

Configuration management system provides a standardized, effective,and efficient way to centrally manage approved changes andbaselines within the project.


P f I t t d Ch C t l


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Inputs

Project management plan Work performance information

Change requests



Outputs

Change request status updates


Project document updates

Tools and Techniques Expert judgment

Change control meetings

Cl P j t Ph


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Close Project or Phase is the process of finalizing all activitiesacross all of the project Management Process Groups to formallycomplete the project or phase.

Close Project or Phase

Cl P j t Ph


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Close Project or Phase

Inputs

Project management plan Accepted deliverables


Outputs

Final product, service or results transition

Organizational process assets update


Expert judgment

E i 2 I t ti M t


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Revising Key Terms

Exercise 2: Integration Management

1. The project management plan is the collection of ______Plans

2. Work Culture and company policies are calledEnterprise__________ Factors

3. ___________ is a document that gives the project managerauthority over the team

A t E i 2 I t ti M t


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Revising Key Terms

Answer to Exercise 2: Integration Management

1. The project management plan is the collection ofSubsidiary Plans

2. Work Culture and company policies are called EnterpriseEnvironmental Factors

3. Project Charter is a document that gives the projectmanager authority over the team

P j t I t ti M t


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Assessment Examination


P j t I t g ti M g t


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QUERIES

&

CLARIFICATIONS




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Next Session

Project Scope Management


chapter 2 - project integration management

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