project management using sap project system (ps) esi 6455 advanced engineering project management...

Project Management using Project Management using SAP Project System (PS) SAP Project System (PS)

ESI 6455ESI 6455 Advanced Engineering Project Advanced Engineering Project Management Management

(Professional MSEM) (Professional MSEM) Spring, 2012 Spring, 2012

Introduction and learning Introduction and learning outcomesoutcomesThis Project Management/SAP Project System (PS)

supports a project/product life cycle, typical in an Engineer-to-Order, Project Centric business and/or organizations facing frequent new products introduction.

The application exercises are designed to demonstrate and apply Project Management concepts and processes using SAP PS as the enabling technology.

PS integrates SAP PS, SAP SD, SAP CO, SAP MM and SAP HR in a large projects context.

PMBOK and PMI are registered marks of the Project Management Institute, Inc.

Project DefinedA complex, non-routine, one-time effort limited by time, budget, resources, and performance specifications designed to meet customer needs.

Major Characteristics of a ProjectHas an established objective.Has a defined life span with a beginning and an end.Typically requires across-the-organizational participation.Involves doing something never been done before.Has specific time, cost, and performance requirements.

PS Introduction: What Is a Project ?PS Introduction: What Is a Project ?

Project Management Body of Project Management Body of KnowledgeKnowledge

PMBOK® Guide identifies generally recognized Project Management “Good practices”◦Correct application of “Good practices” can enhance the

chances of success over a wide range of different projects

Project Life Cycle Definition

Project Management Life Cycle

Five Project Management Process Groups

Nine Knowledge Areas

Project Management Body of Project Management Body of KnowledgeKnowledge

Project Life Cycle Definition

Project can be divided into phases to provide better management control with appropriate links to the ongoing operations of the performing organizations

Completion and approval of one or more deliverables (Scope definition) characterizes a project phase

Some deliverables can correspond to project management process groups (Initiating, Planning, Executing, Monitoring and Controlling, Closing), others are the end products or components of end products for which the project was conceived.

Project Management Life Cycle in the Project Management Life Cycle in the PMBOKPMBOK® ® GuideGuide

Five Project Management Process Groups (not necessarily phases)

◦Initiating◦Planning◦Executing◦Monitoring and Controlling

◦Closing

Knowledge areas in Knowledge areas in PMBOKPMBOK® ® GuideGuide

There are 42 project management processes organized into 9 knowledge areas

The Knowledge Areas are:

• Integration Management

• Scope Management• Time Management• Cost Management

• Quality Management• Human Resources Management• Communications Management• Risk Management• Procurement Management

PMBOKPMBOK® ® GuideGuide Knowledge Areas Knowledge Areas and SAP PS mapping and SAP PS mapping

◦Charter & Scope Management

◦Project structures, WBS, Activities and Networks

◦Cost and Revenue Planning

◦Budget

◦Time Management

◦Customizing Activities and Networks

◦Date Planning


◦Cost Management

◦Cost and Revenue Planning

◦Budget

◦Progress Analysis Workbench

◦Quality Management

◦Resource Planning

◦Material Planning

◦Assigning Documents, Procurement Processes, and Claim Management


–Procurement Management–Material Planning–Assigning Documents, Procurement Processes

–Integration Management–Estimation and development of complete Project Plan

–Customizing Activities and Networks–Progress Analysis Workbench

Project SuccessProject Success

There are different ways to define project success:

◦The project met scope (understood technical functionality), time, and cost goals.

◦The project satisfied the customer/sponsor.◦The project produced the desired results

(expected technical functionality).

Typical Project ConstraintsTypical Project Constraints

Description of Process GroupsDescription of Process Groups

Initiating processes include actions to begin projects and project phases

Planning processes include devising and maintaining a workable scheme to ensure that the project meets its scope, time, and cost goals as well as organizational needs

Executing processes include coordinating people and other resources to carry out the project plans and produce the deliverables of the project or phase.◦A deliverable is a product or service produced or

provided as part of a project

Description of Process GroupsDescription of Process GroupsMonitoring and controlling processes

measure progress toward achieving project goals, monitor deviation from plans, and take corrective action to match progress with plans and customer expectations

Closing processes include formalizing acceptance of the project or phase and bringing it to an orderly end

Guidelines for Time Spent in Each Guidelines for Time Spent in Each Process GroupProcess GroupThe best or “alpha” project managers spend

more time on every process group than their counterparts except for execution, as follows:◦ Initiating: 2% vs. 1%◦ Planning: 21% vs. 11%◦ Executing: 69% vs. 82%◦ Controlling: 5% vs. 4%◦ Closing: 3% vs. 2%*

*Andy Crowe, Alpha Project Managers: What the Top 2% Know That Everyone Else Does Not, Velociteach Press(2006).

PMBOKPMBOK® ® GuideGuide Framework Framework

Stakeholders and InfluencersStakeholders and Influencers• Project Stakeholders

–Project Manager–Customers and/or users–Performing organization–Project team members–Sponsor– Influencers–PMO

• Organizational Influences–Organizational Cultures and

styles–Organizational systems–Organizational structure

• Functional• Matrix• “Projectized”• Project manufacturing

PMBOK® Guide PMBOK® Guide project project Management IntegrationManagement Integration

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Fourth Edition, Project Management Institute, Inc., 2008, Figure 4-1, Page 73.

Initiating Process SummaryInitiating Process Summary

Senior management work together to:

Determine scope, time, and cost constraints

Identify the project sponsor

Select the project manager

Develop a business case for the project

Review processes/expectations

Determine if the project should be divided into two or more smaller projects

Project managers lead efforts to:

Identify and understand project stakeholders

Create the project charter

Hold a kick-off meeting

Inputs to develop Project CharterInputs to develop Project Charter

Charter should explicitly state “what” the project is about: Features and functions that characterize a product, service or result.

◦Product or Service description◦Strategic plan◦Statement of work◦Enterprise environmental factors◦Organizational process assets

Project Charter contentsProject Charter contents• Project Overview• Project Objectives• Requirements• Business Justification

– Strategic– Other

• Preliminary Resources Allocation• High-level time and cost estimates• Roles and Responsibilities• Sign-off• Attachments

Project Charter within SAP PSProject Charter within SAP PSUse Project Builder to create the following:

◦Project Overview◦Project Objectives◦Preliminary Resources Allocation◦High-level time and cost estimates (Root time and cost estimates)

◦Roles and Responsibilities◦Attachments

Project BuilderProject Builder

PMBOK® Guide PMBOK® Guide Project Scope Project Scope ManagementManagement


Creating the Work Breakdown Creating the Work Breakdown StructureStructureA work breakdown structure (WBS) is

a deliverable-oriented grouping of the work involved in a project that defines the total scope of the project

The WBS is a document that breaks all the work required for the project into discrete tasks, and groups those tasks into a logical hierarchy

Hierarchical Breakdown of the Hierarchical Breakdown of the WBSWBS

Work PackagesWork PackagesA Work Package is the Lowest Level of the WBS

◦ It is output-oriented in that it:

Defines work (what)

Identifies time to complete a work package (how long)

Identifies a time-phased budget to complete a work package (cost)

Identifies resources needed to complete a work package (how much)

Identifies a single person responsible for units of work (who)

WBS DictionaryWBS DictionaryDescription of WBS work packages that includes:

◦ Statement of Work◦ Responsible organization◦ Schedules milestones◦ Quality requirements◦ Contract information ◦ Technical references◦ Resource requirements◦ Estimated cost

PMBOK® Guide PMBOK® Guide Project Time Project Time ManagementManagement


Project Time Management Project Time Management Planning Tasks Planning Tasks Project Time Management occurs within SAP PS in

two levels, at the WBS Element, and at the Network activities

In some projects the work components are handled by others, or outsourced. In those situations, a project may be comprised of only WBS elements. Those elements can have time components attached to them.

If components within the WBS element will be carried out and monitored by the organization, then Networks and Activates are created for closer monitoring.

Project Time Management Project Time Management Planning TasksPlanning Tasks

Project time management involves the processes required to ensure timely completion of a project

The main planning tasks performed include defining activities, sequencing activities, estimating activity resource, estimating activity durations, and developing the project schedule

The main documents produced are an activity list and attributes, a milestone list, a network diagram, the activity resource requirements, the activity duration estimates, and a project schedule

The Project NetworkThe Project NetworkA flow chart that graphically depicts the

sequence, interdependencies, and start and finish times of the project tasks/activities ◦ Provides the basis for scheduling labor and equipment◦ Provides an estimate of the project’s duration◦ Provides a basis for budgeting cash flow◦ Highlights activities that are “critical” and should not be delayed◦ Help managers get and stay on plan

Creating a Milestone ListCreating a Milestone List

• A milestone is a significant event in a project• It often takes several activities and a lot of work to

complete a milestone, but the milestone itself is like a marker to help identify necessary activities

• Project sponsors and senior managers often focus on major milestones when reviewing projects

• Sample milestones for many projects include:– Sign-off of key documents– Completion of specific deliverables– Completion of important process-related work, such as

awarding a contract to a supplier

Milestones in PSMilestones in PSIn SAP PS milestones do all of the previous

and they are also used for:◦Reporting purposes such trend and progress

analysis◦Milestone billing◦Activity milestones

Sequencing ActivitiesSequencing Activities

• Sequencing activities involves reviewing the activity list and attributes, project scope statement, and milestone list to determine the relationships or dependencies between activities

• A dependency or relationship relates to the sequencing of project activities or tasks– For example, does a certain activity have to be finished

before another one can start? – Can the project team do several activities in parallel?– Can some overlap?

• Sequencing activities has a significant impact on developing and managing a project schedule

Reasons for Creating Reasons for Creating DependenciesDependencies

• Mandatory dependencies are inherent in the nature of the work being performed on a project– You cannot hold training classes until the training materials are ready

• Discretionary dependencies are defined by the project team– A project team might follow good practice and not start detailed design work

until key stakeholders sign off on all of the analysis work

• External dependencies involve relationships between project and non-project activities– The installation of new software might depend on delivery of new hardware

from an external supplier. Even though the delivery of the new hardware might not be in the scope of the project, it should have an external dependency added to it because late delivery will affect the project schedule

Further defining Activities/TasksFurther defining Activities/Tasks• Task Sequencing and Predecessors

• Establishing durations– Expert judgment– Parametric estimating

• Establishing dependencies– Finish to Start– Finish to Finish– Start to Start– Start to Finish

Dependency TypesDependency Types

Constructing a Project NetworkConstructing a Project Network

Terminology

◦Path: a sequence of connected, dependent activities.

◦Critical path: the longest path through the activity network that allows for the completion of all project-related activities; the shortest expected time in which the entire project can be completed. Delays on the critical path will delay completion of the entire project.

PMBOK® Guide PMBOK® Guide Project Cost Project Cost OverviewOverview


PMBOK® Guide PMBOK® Guide Project Quality Project Quality Management OverviewManagement Overview


PMBOK® Guide PMBOK® Guide Project Human Project Human Resource Management OverviewResource Management Overview


PMBOK® Guide PMBOK® Guide Project Project Communications Management Communications Management OverviewOverview


PMBOK® Guide PMBOK® Guide Project Risk Project Risk Management OverviewManagement Overview


PMBOK® Guide PMBOK® Guide Project Project Procurement Management Procurement Management OverviewOverview


Change is a ProcessChange is a Process

PresentState

TransitionState

DesiredState

Driving Forces Resisting Forces

Unfreezing Changing Refreezing

Summary of Project Closing OutputsSummary of Project Closing OutputsKnowledge area Closing process Outputs

Project integration management

Close project or phase Final product, service, or result transitionOrganizational process assets updates

Project procurement management

Close procurements Closed procurementsOrganizational process assets updates

The Quadruple ConstraintThe Quadruple Constraint

Project Management Tools and Project Management Tools and TechniquesTechniquesProject management tools and techniques assist

project managers and their teams in various aspects of project management.

Note that a tool or technique is more than just a software package.

Specific tools and techniques include:◦Project charters, scope statements, and WBS (scope

deliverables)◦Gantt charts, network diagrams, critical path analyses

(time)◦Net present value, cost estimates, and earned value

management (cost)

Common Project Management Common Project Management Tools and Techniques by Tools and Techniques by Knowledge AreasKnowledge Areas

Schwalbe, Information Technology Project Management, Sixth Edition, 2010

SAP Project System (PS) SAP Project System (PS) Overview Overview

SAP NavigationSAP Navigation

SAP ERP Module StructuresSAP ERP Module Structures

R/3

SAP Module ViewSAP Module View

Integrated SolutionClient / Server

Open Systems

FinancialAccounting

Controlling

Fixed AssetsMgmt.

ProjectSystem

Workflow

IndustrySolutions

ProductionPlanning

Sales &Distribution

MaterialsMgmt.

PlantManagement

QualityMaintenance

Human Resources

SAP Access NavigationSAP Access Navigation

SAP PS Client, Userid, Password SAP PS Client, Userid, Password

SAP R/3 Exercises

Client: 100

Application server: madrid.cob.csuchico.eduSystem number: 82System ID: MDR

Userid: ps-001 to ps-040Initial password: SUBWAY10

Exercises:Exercises:Project management I

• Work breakdown structure• Activities and network• PS texts & Release of project• Reporting using cost element report• Structure information system• Project planning board• Project execution/ Actual data

Project management II• Customer inquiry• Sales project• Reporting using cost element report• Bid calculation/quotation• Incoming order• Reporting using the structure information system• Revenue planning using

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