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MANAJEMEN
INDUSTRI TEKNOLOGIINFORMASI
LESSON 1
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Project
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A project is a complex, non-routine, one-time effort limited by time,budget, resources, and performance specifications designed tomeet customer needsThe major goal: to satisfy a customers need
A project can be considered to be any series of activities and tasks
that have the major characteristics: An established objective Have a specific objective to be completedwithin certain specifications
A defined life span with a beginning and an end Have defined startand end datesUsually, the involvement of several departments and professionals
Are multifunctional (i.e., cut across several function lines)Typically, doing something that has never been done beforeSpecific time, cost, and performance requirements
Have funding limits (if applicable)Consume human and nonhuman resources (i.e., money, people, equipment)
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Project
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The Project Life Cycle (1)
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The life cycle recognizes that projects have alimited life span and that there are predictablechanges in level of effort and focus over the
life of the projectProject effort starts slowly, builds to peak, andthen declines to delivery of the project to thecustomer
Four typically stages:DefinitionPlanningExecutionDelivery
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The Project Life Cycle (2)
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The Project Life Cycle (3)
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Definitionspecifications of the project are definedproject objectives are establishedteams are formedmajor responsibilities are assigned
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The Project Life Cycle (4)
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PlanningThe level of effort increasesPlans are developed to determine:
What the project will entailwhen it will be scheduledwhom it will benefitwhat quality level should be maintainedwhat the budget will be
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The Project Life Cycle (5)
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Execution A major portion of the project work takes place both physical and mental
The physical product is producedTime, cost, and specification measures are usedfor control
Is the project on schedule, on budget, and meetingspecificationsWhat are the forecasts of each these measuresWhat revisions/changes are necessary
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The Project Life Cycle (6)
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DeliveryDelivering the project product to the customer
Customer training
Transferring documentsRedeploying project resources
Releasing project equipment/materials to other projects
Finding new assignments for team members
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Project Management (1)
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Is the art of creating the illusion that any outcomeis the result of a series of predetermined,deliberate acts when, in fact, it was dumb luckIs the planning, organizing, directing, andcontrolling of company resources for a relativelyshort-term objective that has been established tocomplete specific goals and objectives.Furthermore, project management utilizes thesystems approach to management by havingfunctional personnel (the vertical hierarchy)assigned to a specific project (the horizontalhierarchy)
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Project Management (2)
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Involves project planning and projectmonitoring
Project planning
Definition of work requirementsDefinition of quantity and quality of workDefinition of resources needed
Project monitoringTracking progressComparison actual outcome to predicted outcome
Analyzing impactMaking adjustments
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Project Management (3)
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The Importance of Project ManagementCompression of the Product Life CycleGlobal Competition
Knowledge ExplosionCorporate DownsizingIncreased Customer Focus
Rapid Development of Third World and ClosedEconomiesSmall Projects Represent Big Problems
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Project Management (5)
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The potential benefits from project managementare:
Identification of functional responsibilities to ensurethat all activities are accounted for, regardless of
personnel turnover Minimizing the need for continuous reportingIdentification of time limits for schedulingIdentification of a methodology for trade-off analysisMeasurement of accomplishment against plansEarly identification of problems so that correctiveaction may followImproved estimating capability for future planningKnowing when objectives cannot be met or will beexceeded
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Project Management (6)
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Unfortunately, the benefits cannot be achievedwithout overcoming obstacles such as:
Project complexity
Customers special requirements and scopechangesOrganizational restructuringProject risksChanges in technologyForward planning and pricing
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The Project Manager (1)
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Management decides and implements the waysand means to effectively and efficiently utilizehuman and nonhuman resources to reachpredetermined objectives (money, manpower,equipment, facilities, materials,information/technology)Project managers perform the same functions asother managers: they plan, schedule, motivate,and controlThe project manager is unique because she/hemanages temporary, non-repetitive activities andfrequently acts independently of the formalorganization
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The Project Manager (2)
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Project managers are expected to marshalresources to complete a fixed-life project ontime, on budget, and within specifications
Project managers are the direct link to thecustomer and must manage the interfacebetween customer expectations and what isfeasible and reasonable
Project managers provide direction,coordination, and integration to the projectteam, which is often made up of part-timeparticipants loyal to their functional
departments
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The Project Manager (3)
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Project managers are responsible for performance(frequently with too little authority)Project managers must ensure that appropriate
trade-offs are made between the time, cost, andperformance requirements of the projectProject managers generally posses onlyrudimentary technical knowledge to make suchdecisionsProject managers must orchestrate thecompletion of the project by including the rightpeople, at the right time, to address the rightissues and make the right decisions
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The Project Manager (4)
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Discussion
What are the habits of successful projectmanagers?Im an experienced individual contributor butvery new to project management. How do I getmy new project up and going?
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The Project Manager-LineManager Interface
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Successful project management is strongly dependent on: A good daily working relationship between the project manager and those line managers who directly assign resources toprojectsThe ability of functional employees to report vertically to line
managers at the same time that they report horizontally to one or more project managersThe project manager actually works for the line managers,not vice versa the project manager is simply the agentthrough whom this is accomplishedProjects manager depend on line managersEffective project management requires an understanding of:
Quantitative tools and techniquesOrganizational structuresOrganizational behaviour
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The Project Managers Role
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The project manager is responsible for coordinatingand integrating activities across multiple functionallinesThe integration activities performed by the project
manager includeIntegrating the activities necessary to develop a projectplanIntegrating the activities necessary to execute the planIntegrating the activities necessary to make changes to theplan
The project manager must convert the inputs intooutputs of products, services, and ultimately profitsThe project manager needs strong communicativeand interpersonal skills, must become familiar with the
operations of each line organization, and must haveknowledge of the technology being used
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The Line Managers Role (1)
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A specific role for the functional manager The functional manager has the responsibility todefine how the task will be done and where the
task will be done (i.e., the technical criteria)The functional manager has the responsibility toprovide sufficient resources to accomplish theobjective within the projects constraints (i.e., who
will get the job done)The functional manager has the responsibility for deliverable
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The Line Managers Role (2)
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The line managers problems: Unlimited work requests (especially during competitivebidding)Predetermined deadlines
All requests having a high priorityLimited number of resourcesLimited availability of resourcesUnscheduled changes in the project planUnpredicted lack of progress
Unplanned absence of resourcesUnplanned breakdown of resourcesUnplanned loss of resourcesUnplanned turnover of personnel
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The Evolution of ProjectManagement Systems (1)
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A three-phase model:Phase One: Ad Hoc UsePhase Two: Formal Application
Phase Three: Project-Driven Organization
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The Evolution of ProjectManagement Systems (2)
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Phase One: Ad Hoc UseTypically begins with an individual or departmentchampion initiating the use of one or more the basicproject management tools in a project
The tools appear to hold potential for improvingproject successTop management will have little or no involvement inthe decision to use these tools
In a few cases, these attempts end in failureNear the end of this phase, conflicts across functionallines often appear as tensions arise over the controland directions of projects
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The Evolution of ProjectManagement Systems (3)
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Phase Two: Formal ApplicationVarious needs and inadequacies are recognized as barriers to projectsuccessTypical of this phase is the recognition that project management trainingis needed for every management level in the organizationTop management takes an interest in better management of projectsThe need for quality control becomes an issueThe concept of a customer or client for each project becomes part of theorganizational cultureProjects managers are given more control over the projectsQuestions relating to the effectiveness of the current organizationstructure are heard in private conversationsTop management is not active in project selection and prioritizingprojectsManagement needs a retreat to integrate strategic planning and projects
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The Evolution of ProjectManagement Systems (4)
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Phase Three: Project-Driven OrganizationThe outlook is long runTop management is now playing a significant role in settingstrategy, in developing a balanced project portfolio, and in settingproject priorities
Project management is a part of the organizational cultureThe organizational structure has shifted toward a project matrixand project teams with dedicated resourcesProjects are integrated with accountingTraining and policy manuals have been written for each phase of the project life cycleTermination of projects includes a project audit and evaluation of time, cost, and technical performanceThe outcome of this effort is disciplined, integrated,organizational approach to managing and implementing projectslinked to strategic plans
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The Evolution of ProjectManagement Systems (5)
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These three phase occur at different timesdepending on the type and size of the firmIt is probably desirous to move to phase threeas quickly as possible to compete moreeffectivelyMigration to excellence can be expedited by
developing the skills and capabilities of everymanager in the organization through training inproject management
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An Integrative Approach (1)
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As the world becomes more competitive, theimportance of managing the process of projectmanagement and getting it right the first time takeson new meaning
Piecemeal systems fail to tie to the overall strategies of thefirmPiecemeal project priority systems fail to prioritize projectselection to resources and those projects that contributemost to the strategic plan
Piecemeal tools and techniques fail to be integratedthroughout the project life cyclePiecemeal approaches fail to balance the application of project planning and control methods with appropriateadjustments in the organizations culture to support projectendeavour
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An Integrative Approach (2)
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Today emphasis is on development of anintegrated project management process thatfocuses all project effort toward the strategic plan
of the organization and reinforces mastery of boththe project management tools/techniques and theinterpersonal skills necessary to orchestratesuccessful project completion
Integration in project management directsattention to two key areas:
Integration of projects with the strategic planIntegration within the process of managing actualprojects
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An Integrative Approach (3)
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Integration of projects with the strategic planIn some organizations, selection and management of projectsoften fail to support the strategic plan of the organization
Strategic plan are written by one group of managers, projectsselected by another group, and projects implemented by another
An integrated project system is one in which all of the parts areinterrelatedMission, objectives, and strategies are set to meet the needs of customersDevelopment of a mission, objectives, and strategies depend on theexternal (political, social, economic and technological) and internal(management, facilities, core competencies, financial condition)environmental factors
Implementing strategies are the most difficult step; strategies aretypically implemented through projects
Prioritizing projects so that scarce resources are allocated to the rightprojects
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An Integrative Approach (4)
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ScopeWork Breakdown Organization
Networks LeadershipResources Teams
Cost Partners
Customer
Environmental Analysis
Project Implementation
Environmentand cultureSystem
Projects
External Internal
FirmMission
Goals, Strategies
Priorities
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An Integrative Approach (5)
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Integration within the process of managing actual projectsThe technical side of the management process
Consists of the formal, disciplined, pure logic parts of the processRelies on the formal information system availableIncludes planning, scheduling, and controlling: Scope, WBS, Schedules,Resource Allocation, Baseline Budgets, Status Reports
Represents the science of project management The socio-cultural side of the management process
Involves the much messier, often contradictory and paradoxical world of implementation: leadership, problem solving, teamwork, negotiation, politics,customer expectationsCentres on creating a temporary social system within a larger organizationalenvironment that combines the talents of a divergent set of professionalsworking to complete the projectInvolves managing the interface between the project and external environmentRepresents the art of managing a project
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Project-Driven versus Non-Project-Driven Organizations
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Project-Driven Organization All work is characterized through projects, with eachproject as a separate cost centre having its own profit-and-loss statement
The total profit to the corporation is simply the summationof the profits on all projectsEverything centres around the projects
Non-Project-Driven OrganizationProfit-and-loss are measured on vertical or functional linesProjects exist merely to support the product lines or functional linesPriority resources are assigned to the revenue-producingfunctional line activities rather than the projects
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Project-Driven versus Non-Project-Driven Organizations
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Project management in a non-project-driven organization isgenerally more difficult for these reasons:
Projects may be few and far betweenNot all projects have the same project management requirements, andtherefore they cannot be managed identically. This difficulty results frompoor understanding of project management and a reluctance of companies to invest in proper trainingExecutives do not have sufficient time to manage projects themselves,yet refuse to delegate authorityProjects tend to be delayed because approvals most often follow thevertical chain of command. As a result, project work stays too long infunctional departments
Because project staffing is on a local basis, only a portion of theorganization understands project management and sees the system inactionThere is heavy dependence on subcontractors and outside agencies for project management expertise
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Project-Driven versus Non-Project-Driven Organizations
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Non-project-driven organizations may alsohave a steady stream of projects, all of whichare usually designed to enhancemanufacturing operations.Some projects may be customer-requested,such as:
The introduction of statistical dimensioning
concepts to improve process controlThe introduction of process changes to enhancethe final productThe introduction of process change concepts toenhance product reliability
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Project-Driven versus Non-Project-Driven Organizations
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If these changes are not identified as specificprojects, the result can be:
Poorly defined responsibility areas within the
organizationPoor communication, both internal and external tothe organizationSlow implementation
A lack of a cost-tracking system for implementationPoorly defined performance criteria
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Project-Driven versus Non-Project-Driven Organizations
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The tip-of-the-iceberg syndrome can occur inall types of organizations but is most commonin non-project-driven organizations
On the surface, all we see is lack of authorityfor the project manager. But, beneath thesurface we see the causes; there is excessivemeddling due to lack of understanding of project management, which, in turn, resultedfrom an inability to recognize the need for proper training
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Project-Driven versus Non-Project-Driven Organizations
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Delegation of authority to
project manager
Excessive meddlingLack of understanding of how project management
should work
Lack of training in communication/interpersonal skills
Many of the problems surface much later in the projectand result in a much higher cost to cor rect as well as
increase project r isk
k i i h j i
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Marketing in the Project-DrivenOrganization
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Getting new projects is the lifeblood of anyproject-oriented businessMarketing projects requires the ability to identify,pursue, and capture one-of-a-kind businessopportunities, and is characterized by:
A systematic effortCustom designProject life cycleMarketing phaseRisksThe technical capability to perform
M k i i h P j D i
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Marketing in the Project-DrivenOrganization
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In spite of the risks and problems, profits onprojects are usually very low in comparisonwith commercial business practices
One may wonder why companies pursueproject businesses
M k i i h P j D i
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Marketing in the Project-DrivenOrganization
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Clearly, there are many reasons why projects are good business: Although immediate profits (as a percentage of sales) are usually small,the return on capital investment is often very attractive. Progresspayment practices keep inventories and receivables to a minimum andenable companies to undertake projects many times larger in value thanthe assets of the total company
Once a contract has been secured and is being managed properly, theproject may be of relatively low financial risk to the company. Thecompany has little additional selling expenditure and has a predictablemarket over the life cycle of the projectProject business must be viewed from a broader perspective thanmotivation for immediate profits. Projects provide an opportunity todevelop the companys technical capabilities and build an experience
base for future business growthWinning one large project often provides attractive growth potential,such as (1) growth with the project via additions and changes; (2) follow-on work; (3) spare parts, maintenance, and raining; and (4) being able tocompete effectively in the next project phase, such as nurturing a studyprogram into a development contract and finally a production contract
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Classification Projects
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Type of Project/Industry
In-houseR&D
SmallConstruction
LargeConstruction
Aerospace/Defence
MIS Engineering
Need for interpersonalskills
Low Low High High High Low
Importance of organizationalstructure
Low Low Low Low High Low
Timemanagementdifficulties
Low Low High High High Low
Number of meetings Excessive Low Excessive Excessive High Medium
Projectsmanager supervisor
Middlemanagement
Top management
Top management
Top management
Middlemanagement
Middlemanagement
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Classification Projects
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Type of Project/Industry
In-houseR&D
SmallConstruction
LargeConstruction
Aerospace/Defence
MIS Engineering
Project sponsor present
Yes No Yes Yes No No
Conflict intensity Low Low High High High Low
Cost control level Low Low High High Low Low
Level of planning/scheduling
Milestonesonly
Milestonesonly
Detailedplan
Detailedplan
Milestonesonly
Milestonesonly
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