Project Management PHHA 422 2022-2023 PDF

Course Title: Project Management Course Code: PHHA 422 Department of Health Management College of Public Health and Health Informatics University of Hail 1  Course Outline Chapter Content 1 I...

Course Title: Project Management Course Code: PHHA 422 Department of Health Management College of Public Health and Health Informatics University of Hail 1  Course Outline Chapter Content 1 Introduction to Project Management 2 Project Definition and Scope 3 Understanding the Project Context and Healthcare 4 Needs Analysis and Project Scoping 5 Feasible Project Planning and Design 6 Project Implementation and Control 7 Evaluating the Project Performance 8 Project Completion 2 Learning Objectives Upon completion of this course, the students should be able to: 1. Understand the basic concepts of Project Management, which includes Initiating, Planning, Executing, Controlling and Monitoring and Closing of projects. 2. Understand the Project management in the context of healthcare 3. Understand and learn the Project Management Tools and Techniques 3  Schedule of Assessment Assessment task (e.g. essay, test, group project, Proportion of Total examination, speech, oral presentation, etc.) Week Due Assessment 1 - 10 5% 1 Extracurricular Activities 3&8 10% 2 Quizzes 6 30% 3 Midterm exam 8 5% 4 Assignments 1 50% 5 Final exam 4  Chapter 1 Introduction to Project Management 5 Introduction  Many organizations including HCO, today have a new or renewed interest in project management.  The U.S. spends $2.3 trillion on projects every year, or one- quarter its Gross Domestic Product, and the world as a whole spends nearly $10 trillion of its $40.7 gross product on projects of all kinds.*  The Project Management Institute (PMI, est. 1969) formalizes the techniques of this discipline within the Project Management Body of Knowledge (PMBOK) *PMI, The PMI Project Management Fact Book, Second Edition, 2001. 6 What is a Project? A project is “a temporary endeavor undertaken to create a unique product, service, or result.”* A project ends when its objectives have been reached, or the project has been terminated. Projects can be large or small and take a short or long time to complete. *PMI, A Guide to the Project Management Body of Knowledge (PMBOK® Guide) (2004), p. 5. 7 Project Attributes… (Characteristics) 1.A project has a unique purpose:  Every project should have a well-defined objective. 2.A project is temporary:  A project has a definite beginning and a definite end. 3.A project is developed using progressive elaboration or in an iterative fashion.  Projects are often defined broadly when they begin, and as time passes, the specific details of the project become more clear. 8 Project Attributes (Characteristics) 4. A project requires resources, often from various areas.  Resources include people, hardware, software, or other assets. 5.A project should have a primary customer or sponsor.  Most projects have many interested parties or stakeholders, but someone must take the primary role of sponsorship.  The project sponsor usually provides the direction and funding for the project. 6.A project involves uncertainty:  Because every project is unique, it is sometimes difficult to define the project’s objectives clearly, estimate exactly how long it will take to complete, or determine how much it will cost. 9 A Project Can Create… A product that can be either a component of another item, an enhancement of an item, or an end item in itself; A service or a capability to perform a service (e.g., a Health care business function that supports production or distribution); An improvement in the existing product or service lines (e.g., A Six Sigma project undertaken to reduce defects); or A result, such as an outcome or document (e.g., a research project that develops knowledge that can be used to determine whether a trend exists or a new process will benefit society). 10  What are the projects? Examples of projects include, but are not limited to: Developing a new product, service, or result; Effecting a change in the structure, processes, staffing, or style of an organization; Developing or acquiring a new or modified information system (hardware or software); Conducting a research effort whose outcome will be aptly recorded; Constructing a building, industrial plant, or infrastructure; or Implementing, improving, or enhancing existing business processes and procedures. Assignment -1 11  What is Project Management?  Project management is “the application of knowledge, skills, tools and techniques to project activities to meet project requirements.”* *PMI, A Guide to the Project Management 12 Body of Knowledge (PMBOK® What is Project Management?  Project management is accomplished through the appropriate application and integration of the project management processes, which are categorized into five Process Groups.  These five Process Groups are: Initiating, Planning, Executing, Monitoring and Controlling, and Closing. 13 Project Management Framework 14 Relationships Among Portfolio Management, Program Management, Project Management, and Organizational Project Managt. A project is “a temporary endeavor undertaken to create a unique product, service, or result.”*  A Program: “A group of related projects managed in a coordinated way to obtain benefits and control not available from managing them individually.”*  A portfolio refers to projects, programs, sub-portfolios, and operations managed as a group to achieve strategic objectives. The projects or programs of the portfolio may not necessarily be interdependent or directly related 15 16 Projects and Strategic Planning & Project Management Office  Projects are often utilized as a means of directly or indirectly achieving objectives within an organization’s strategic plan.  Projects are typically authorized as a result of one or more of the strategic considerations such as Market Demand, Strategic opportunity/business need, Social need, Environmental considerations, customer request, technological advances, legal requirements etc…  A project management office (PMO) is a management structure that standardizes the project-related governance processes and facilitates the sharing of resources, methodologies, tools, and techniques.  The responsibilities of a PMO can range from providing project management support functions to actually being responsible for the direct management of one or more projects. 17 The role of the Project Manager The project manager is the person assigned by the performing organization to lead the team that is responsible for achieving the project objectives. The role of the project manager (PM) is that of an enabler. 1. Run interference for the team. 2. Get scarce resources that team members need. 3. Buffer the team from outside forces that would disrupt work. 4. Provide leadership. 18  The Role of the Project Manager The PM should facilitate planning. Effective PMs require a balance of technical, interpersonal, and conceptual skills. Technical and conceptual skills are acquired by way of work experience and formal education. Interpersonal skills are just as important as technical and conceptual skills. In fact, the PMBOK® Guide, 5th Ed., p.18, it list the following important interpersonal skills which are: 1. Leading 7. Political and cultural awareness 2. Team building 8. Negotiation 3. Motivation 9. Trust building 4. Communication 10. Conflict management 5. Influencing 11. Coaching 6. Decision making 19  Project Management as a Profession  Professional societies such as the Project Management Institute (PMI) have grown significantly.  There are specific interest groups in many areas, such as engineering, financial services, health care, and IT.  Project management research and certification programs continue to grow.  PMI provides certification as a Project Management Professional (PMP).  A PMP has documented sufficient project experience, agreed to follow a code of ethics, and passed the PMP exam.  The number of people earning PMP certification is increasing 20 Ethics in Project Management  Ethics are an important part of all professions, more importantly in Health care.  Project managers often face ethical dilemmas.  In order to earn PMP certification, applicants must agree to the PMP code of professional conduct.  Several questions on the PMP exam are related to professional responsibility, including ethics. 21  Exercise 1 Name some of the health care projects in KSA? Hospital Construction Projects Hospital Expansion/ Renovation Projects Healthcare IT Projects Healthcare Research Projects International, National & State Health Projects 22  Chapter 2 Project Definition and Scope 23 PMI Definition of a Project A project is “a temporary endeavor undertaken to create a unique product, service, or result.”* *PMI, A Guide to the Project Management Body of Knowledge (PMBOK® Guide) (2004), p. 5. 24 Project - Definitions Glitnger “ the whole of complex of activities involved in using resources for benefit” E.L Hanson “A non-routine, non-repetitive one-off undertaking normally with discrete time, financial and technical performance goals” Little and Mirless “ any scheme or a part of a scheme for investing resources which can be reasonably analyzed and evaluated as a independent unit. It may be any item of investment activity which can separately be evaluated. 25  Project - Definitions World Bank: “An approval for a capital investment to develop facilities to produce goods and services” Encyclopedia of Management “ “ project is an organized unit dedicated to the attainment of goals. The successful completion of a development project on time, within budget in conformance with pre-determined programme specifications” 26 The scope of project  The scope of a project should remain constant throughout the life of the job.  Unforeseen problems or an inadequately defined problem the most common reason for scope changes is that something is forgotten.  In most cases the magnitude (scope) of the work increases, as a result of overlooked details. 27 The scope of project…  Scope generally increases.  The only time project scope decreases is when the budget is cut, and some of the originally planned work is put on hold.  The problem with scope changes is that they tend to be small and incremental, if a number of them occur, the project budget or schedule may suffer. This is a fairly common cause of project failures. 28 The Four Project Objectives are…  Performance  Scope  Cost  Time 29 Performance, Scope, Cost & Time  Performance: The quality of the work being done.  Scope: The magnitude of the work to be performed.  Cost: The cost of project work, directly related to the human and physical resources applied.  Time: The schedule that must be met. 30  The relation between the four project objectives: Cost=f(P,T,S) Cost is a function ( f ) of Performance (P), Time (T), and Scope (S). As P and S increase, Cost generally increases. 31 Project Manager & The Scope  A project manager has a responsibility to keep stakeholders informed about the impact of scope changes on the project, protecting them from surprises at the end of the job and protecting the project manager from being evaluated on original targets rather than on revised ones. 32 The Triple Constraint  Every project is constrained in different ways by its: ◦ Scope goals: What work will be done? ◦ Time goals: How long should it take to complete? ◦ Cost goals: What should it cost?  It is the project manager’s duty to balance these three often-competing goals. 33 The Triple Constraint of Project Management Successful project management means meeting all three goals (Scope, Time, and Cost) – and satisfying the project’s sponsor. Figure 1-1. The Triple Constraint of Project Management 34  Project Management PHHA 422 Chapter 3 Understanding the project context and healthcare 35 The Project Life Cycle  The Project Life Cycle: The sequence of phases through which the project will evolve is a called as project life cycle.  A PLC is defined by its phases, according to which a project swims through & finally reaches to handover stage. 36 The Project Life Cycle - Phases The Project Management processes are divided into five (5) phases or groups: 1. Initiating 2. Planning 3. Executing 4. Monitoring and Controlling 5. Closing 37 The Project Life Cycle – Phases 38  The Project Life Cycle – An Example of a New Hospital 39  Risk during the Life Cycle  Figure 1-6, shows the uncertainty as seen at the beginning of the project.  Figure 1-7, shows that the uncertainty decreases as the project moves toward completion. 40 Project Stakeholders  “Stakeholder is a person or group of people who have a vested interest in the success of an organization and the environment in which the organization operates”  Project Stakeholders are the people involved in or affected by project activities.  Stakeholders include:  Project sponsor  Project manager  Project team  Support staff  Customers  Users  Suppliers  Opponents to the project etc… 41 Stakeholder Engagement process  Identify Stakeholders  Assess needs  Define actions  Establish communication channels  Gather feedback  Monitor and review 42 The Context of Healthcare Project Management 43 Project Management in Health Care  In health care, clinical and administrative staff with no formal training in project management often end up leading project teams.  These individuals may be subject matter experts, but likely have only a passing knowledge of the science of improvement.  Health Care Project Management provides the training health care professionals need to improve the quality of care at their organization through projects delivered on time and within budget. (Source: https://www.hsph.harvard.edu/ecpe/programs/health-care-project- management) 44 Project Management in Health Care  Health care is one of the largest service industry in the world, and it is one in which project management is playing a larger part.  While advances in biomedical technology are accelerating costs, managed care has the potential of reducing cost.  Already there has been the downsizing of systems and the mergers of many health care organizations. 45 The Nature of Healthcare Projects  Some unique aspects of healthcare projects include the following:  Patient quality is a key concern: Most healthcare projects are done to help people prevent, improve, or deal with a health concern.  Government often plays a big role: The government is often the sponsor or reason for a healthcare project (such as many electronic health record projects) or it creates laws or standards that must be followed in public/private healthcare projects. 46 The Nature of Healthcare Projects  Finances are different in many healthcare organizations. Revenues are difficult to estimate. The healthcare organizations are not-for-profit and For-profit  Healthcare is very personal: People have very different attitudes about healthcare, such as how private or open they are about discussing it, how much they are willing to spend on it, what types of services they will use, etc.  Quality of Care, cost containment, and external review are key characteristics: Unlike many other types of projects, healthcare projects normally include these three hallmarks. 47  Project Management in Health Care  Four major project management challenges in the health care field are: 1. the historical rivalry between clinical professionals and lack of shared incentives; 2. the difficulty that financial and clinical professionals have working together; 3. poor morale and lack of enthusiasm for the project objective; and 4. misunderstanding and poor communication due to the high diversity of disciplines. Source: http://www.pmi.org/learning/library/four-challenges-health-care- project-managers-3630 48 Project Management in Health Care  Examples of healthcare entities and related projects in various contexts include the following: 1.Patient/Health Consumer Level: A family makes modifications to their home to accommodate a handicapped family member. A diabetic initiates a structured self-management program. 2.Sole Providers and Physician Groups A physician’s office implements an electronic health record system. A physician group modifies its billing system to meet revised International Classification of Diseases (ICD) code sets used to report diagnoses and inpatient procedures. 49 Project Management in Health Care 3.Hospital/ Hospital Departments: A community hospital launches a women’s healthcare service line. A university hospital designs and constructs a new neurology clinic. A hospital develops a physician evaluation program in alignment with new standards. 4.Health Research:  A software company develops a smart phone application to assist diabetics with self-management. A team of medical researchers conducts a clinical trial of a new medical device. 50 Project Management in Health Care 5.Payers A health insurance company establishes a medical call center and Web site to help subscribers make decisions regarding medical care options. 6.Government and Public Health  A developing country’s health department launches a maternal and child wellness program. The state public health department develops and launches an immunization campaign. 7.Healthcare Vendor/Auditing  A medical supply and distribution company installs new distribution software that will facilitate just in time inventory levels.  An audit team conducts an audit of a health organization. 51 Exercise 2 – Who are the Stakeholders? Sponsor Funding Body Customer Suppliers End User Environmental Agency Maintenance Team Neighbours/Community/Shareholders Community Provide the examples from Health care Sector… 52 Project Management PHHA 422 Chapter 4 Needs analysis 53 Project Needs analysis Project Needs analysis: Feasibility Analysis Technical Analysis Market and Demand or Commercial Analysis Economic Analysis (Social Cost- Benefit Analysis) Financial Analysis 54 What is Feasibility Analysis?  Feasibility Analysis ◦ Preliminary evaluation of idea to determining if it’s worth pursuing ◦ Provides more secure notion that a project idea is viable ◦ As project ides is examined 3 alternatives could be considered  The project idea seems to be feasible: Then, proceed to the next step  The project idea is not feasible: Abandon the idea  Unable to arrive at a conclusion: Make more efforts to collect the required data  Postpone till a final decision can be taken 55 Four Components of Full Feasibility Analysis An Overview  Product/Service Feasibility ◦ Composed of two primary tests  Concept testing  Usability testing  Industry/Market Feasibility ◦ Three primary issues a proposed business should consider:  Industry attractiveness  Market timeliness  Identification of a niche market. (Subset of the market on which a specific product is focused)  Organizational Feasibility ◦ There are two primary issues to consider in this area:  Management ability  Resource sufficiency  Financial Feasibility ◦ The most important issues to consider at this stage are:  Capital requirements  Financial rate of return  Overall attractiveness of the investment 56 Feasibility Analysis Role of feasibility analysis in developing successful project ideas 57 Technical Analysis Determine whether the prerequisites for the successful commission of the project have been considered and reasonably good choices have been made with respect to location, size, process etc. The technical aspects of a typical project idea can be scrutinized in detail to evaluate its technical feasibility While the various aspects to be examined the following are more common ones: Objectives: First, the project proposal must fall within the ambit of the stated mission of the sponsor(s). Next the, proposal must be able to further the objectives and priorities of the sponsor(s). 58 Technical Analysis  Location and site: Initially, as many locations as possible should be identified which meet the most fundamental operational requirements of the proposed project.  Plant Size: Determination of an optimum plant size is critical to the success of a project.  Technology: The same product or service can generally be obtained using quite different technologies  Design, Layout & Plant & Machinery: The feasibility study should broadly specify the recommended design of the processes and plant  Construction Process: This needs to be tackled in. the feasibility study  Inputs: These relate to the operation phase of the project, but need to be identified at this stage of the feasibility study to examine the technical feasibility 59 Technical Analysis Infrastructural Facilities: Availability and characteristics of roads, bridges, railway facilities (like station, yards), air transportation, waterways, ports, etc Manpower: The availability in needed numbers, of manpower of requisite skills where and when required, has to be studied Environment Impact Assessment (EIA):  The greater the thoroughness with which the technical analysis is carried out, the more reliable and complete the Project Specifications are, and the lesser the chances of major unforeseen problems cropping up and jeopardizing the project. 60 Market and Demand Analysis  Consumer driven markets – Healthcare  Market size and demand is vital to any project  Market Analysis is concerned with – what would be the market share of the project/service under appraisal?  Demand Analysis – what would be the aggregate demand of the proposed product/service in future?  Market and Demand Analysis is concerned with estimation of the potential size of the market for the proposed product/service to be offered and get an idea about the market share that is likely to be captured. 61 Key steps in market and Demand analysis Collection of Secondary Demand Information Forecasting Situational Analysis & Characterizat Specification ion of the of Objectives Market Market Conduct of Planning Market Survey 62  Market and Demand Analysis Steps in conducting Market and Demand Analysis: 1. Situational Analysis 2. Collection of Secondary Information 3. Conduct of Market Survey 4. Characterisation of the market 5. Demand forecasting and 6. Market Planning 63 Economic Analysis (Social Cost- Benefit Analysis)  Economic Analysis (Social Cost- Benefit Analysis) or economic analysis is the methodology designed for evaluating investment projects from the point view of society or economy as a whole.  It is a tool for evaluating the value of money, particularly in public sector projects  Cost-Benefit Analysis (CBA) estimates and totals up the equivalent money value of the benefits and costs to the community of projects to establish whether they are worthwhile. 64  Objectives Of Social Cost Benefit Analysis (SCBA)  SCBA focuses on the following objectives that a project is expected to fulfill: ◦ Contribution of the project to the GDP of the economy. ◦ Contribution of the project to improve the benefits to the poorer sections of the society and to reduce the regional imbalances in growth and development. ◦ Justification of the use of scarce resources of the economy by the project. ◦ Contribution of the project in protecting/improving the environmental conditions. 65 Rational or Need for SCBA 1. Market imperfection 2. Externalities 3. Taxes and substitutes 4. Concern for savings 5. Concern for distribution 6. Merit wants 66 Approaches for SCBA  There are two main approaches to Social Cost Benefit Analysis:  UNIDO approach and  Little-Mirrlees approach The suitability of an approach to a project depends upon many factors such us the present level of development of the country, the extent and nature of future development that the country strives to achieve etc. 67 Approaches for SCBA UNIDO Approach to SCB Analysis  Famous economists Stephen Marglin, Amartya Sen and Partha Dasgupta prepared a manual based on UNlDO's experience in cost-benefit analysis of projects.  UNIDO published this manual in 1972 under the title "Guidelines for Project Evaluation".  The UNIDO approach places emphasis on 'aggregate consumption' for the reason that it is one of the important parameters for the measurement of the standard of living.  As per UNIDO approach, the raising of the standard of living of people, and hence the raising of aggregate consumption is an important objective for social projects. 68  Approaches for SCBA UNIDO Approach to SCB Analysis - Stages I. Arriving at the financial profitability of the project based on market prices. II. Using shadow prices for the resources to arrive at the net benefit of the project at economic prices. III. Adjustment of the net benefit for the project's impact on savings and investment. IV. Adjustment of the net benefit for the project's impact on income distribution. V. Adjustment of the net benefit for the goods produced whose social values differ from their economic values. 69  Approaches for SCBA The Little- Mirrlees Approach  I.M.D. Little and James A. Mirrlees produced the "Manual of Industrial Project Analysis in Developing Countries" in 1968 for the Development Centre of the Organisation for Economic Cooperation and Development (OECD).  Little and Mirrless brought out a second volume titled "Project Appraisal and Planning for Developing Countries" in the light of practical applications to S.C.B. analysis of projects.  L-M's numeraire (unit of account) is "present uncommitted social income measured in terms of convertible foreign exchange of constant purchasing power". 70  Approaches for SCBA The Little- Mirrlees Approach – Steps 1. Calculating accounting or shadow prices particularly for foreign exchange savings and unskilled labour 2. Considering the factor of equity 3. Use of Discounted Cost of Factor (DCF) analysis In LM approach, output and inputs of a project and their shadow prices are classified into: Traded goods Non-Traded goods Labour 71  SCBA - Components The social cost benefit analysis consists of the following:  Definition of project: proposed reallocation of resources scope  Identification of project impacts Which impacts are economically relevant? Physical quantification of relevant impacts  Monetary valuation of relevant effects (i) predict prices for value flows extending into the future (ii) correct market prices where necessary (iii) calculate prices (relative values in common units) where none exist  Discounting of cost and benefit flows  Applying the NPV or IRR test  Sensitivity analysis 72 Financial Analysis Financial analysis seeks to determine whether the proposed project will be financially viable. Financial Analysis Defined as a analysis which compare the costs and benefits over time to determine whether a project is profitable or not. To achieve this the following financial indicators are used:  Net Present Value (NPV)  Internal Rate of Return (IRR)  Sensitivity Analysis 73 Steps in conducting a Financial Analysis 1. Identify the costs 2. Identify the benefits 3. Calculate the costs and benefits with financial formulas/indicators 4. Assess the financial indicators to determine if the project is financially favourable. 74 Project Management PHHA 422 Chapter 5 Project Planning and Design 75 Project Planning  The primary purpose of planning is to establish a set of directions in sufficient detail to tell the project team exactly what must be done, when it must be done, and what resources to use in order to produce the deliverables of the project successfully  The process of developing the project plan varies from organization to organization, but any project plan must contain the following elements: Overview: This is a short summary of the objectives and scope of the project. Objectives: This contains a more detailed statement of the general goals noted in the overview section. General Approach: This section describes both the managerial and the technical approaches to the work. 76 Project Planning Contractual Aspects: This critical section of the plan includes a complete list and description of contracts Schedules: This section outlines the various schedules and lists all milestones events. Resources: There are two primary aspects to this section. The first is the budget and second, cost monitoring and control procedures should be described. Personnel: This section lists the expected personnel requirements of the project. Special skills, types of training needed, possible recruiting problems, legal or policy restrictions on work force composition etc. Evaluation Methods: Every project should be evaluated against standards and by methods established at the project’s inception. Potential Problems: Sometimes it is difficult to convince planners to make a serious attempt to anticipate potential difficulties. 77 Detailed Project Report  DPR prepared before implementation stage  A DPR is an official document which elaborates the objectives of a capital project and the modus operandi (method of operation) for its implementation for the realization of the specific objectives 78 Areas to be covered in Detailed Project Report 1. Company profile, present 3. Technical aspects – position – particulars of enclose process flow chart, business, basic info. Nature location, layout, CB & category of project etc analysis, technical issues, Inputs required, 2. Project to be taken up for expenditure etc. diversification – outline of the project with 4. Market viability – diversification, address, forecast, sales and demand agencies involved etc 5. Financial viability – cost estimates and all 79 Areas to be covered in Detailed Project Report 6. Risk analysis - risk analysis, 9. Environment – Ecological assumptions made balance 7. Economic Viability –to overall 10. Managerial viability – development of economy, clear picture of org. optimal use of resources etc structure, functioning, 8. Energy Management – energy delegation of authority etc. conservation of alternative source of energy 80  Importance of DPR 1. It formalizes capital project 2. It provides right direction during the project implementation 3. It provides basis for obtaining funds 4. It helps project manager in co-ordination 5. Handbook for reference 6. It helps in Decision making 7. It helps in checking lavish expenditure, wastes, inefficiency etc. 81  Structure of DPR 1. Contents of the project feasibility report 2. Basis of the project It discusses about general environment Covers – economic plans, Imp of project for national economy Current market status An analysis with respect to capability & performance of an industry, existing products/services, it role in industry etc. 3. Need and objectives of the project The circumstances under which the proposed project is undertaken What is the essence of project Domestic/international market conditions Why it is best among alternatives 4. Conclusion – Recommendations Of Project Launching 82 Project Selection The selection of the right project for future investment is a crucial decision for the long-term survival of a company. The project selection process should be recognized as a subsection of other knowledge areas, namely; scope management (scope initiation), project life-cycle (concept phase) and the feasibility study. 83  Project Selection Project Selection Models Numeric Models: May be subdivided into financial models and scoring models. The financial models are: Payback period Return on investment (ROI) Net present value (NPV) Internal rate of return (IRR) Non-numeric models The factor model: Simply lists a number of desirable factors on a project selection preformat along with columns for Selected and Not Selected Cost Break-even Analysis Project Life-cycle Cash-flow 84 Return On Investment (ROI)  Return on investment (ROI) measures the gain or loss generated on an investment relative to the amount of money invested.  For example, an Healthcare investor buys SR1,000 worth of stocks and sells the shares two years later for SR1,200. The net profit from the investment would be SR 200 and the ROI would be calculated as follows:  1200 – 1000 = SR 200 Average Annual Profit/1000 Original Investment  ROI = (200 / 1,000) x 100 = 20%  The ROI in the example above would be 20%. 85  Cost Break-Even Analysis  Cost Break-even Analysis technique explains how the costs change with increasing production and determine the break- even point. Example: Siemens company manufactures BP Monitor equipment which sells for SR 25 each. The variable cost per unit is SR 5, this covers labour and material, leaving SR10 per unit as a contribution towards fixed costs. The fixed costs total is SR 75,000 per annum, which covers all the overhead costs. The break-even point is reached when the contribution equals the fixed costs. Break-even point = Fixed costs Contribution per unit = 75,000 = 7,500 units 10 The break-even point is 7,500 units, when sales income exactly balances the total cost of SR 112,500 (labour and material 7,500 X 5 = SR 37,500 + fixed costs SR 75,000). Output less than this amount would result in a loss, while greater output would make a profit. 86 Organization Structures  Organizational structure is concerned with the allocation of task and establishment of authority-responsibility relationship between the members of the organization.  Broadly speaking, organizational structure can be of three types. They are, Functional organization Product organization Matrix organization Pure Project Organization Structure Work Break down Structure (W BS) 87 Functional Organization  Functional organization is the most basic and logical form of organizational structure.  Functional organization brings together in one department all those who are engaged in one activity or in one or more related activities. 88 Product Organization  For organizations with a longer product line, the form of organizational structure suited is the Product Organization structure.  The advantage of product organization is that all the activities, skills and expertise required to produce and market a particular product (or a group of related products) are grouped together under a single head. 89 Matrix Organization  The matrix organizational structure is one in which functional and staff personnel are assigned to both a basic functional area and to a project or product manager  The matrix form is intended to make the best use of talented people within a firm by combining the advantages of functional specialization and product-project specialization 90 Pure Project Organization Structure A pure project organization structure is one in which the project manger is in total control of all other departments. This form of organizational structure is suited if the organization has a complex project whose resource requirements are large. In such situations, all the resources required for the project are left at the disposal of the project manager. A pure project organization is more or less like an autonomous division of the organization headed by the project manager. 91 Break Down Structures  Modem methods of project management use breakdown structures for work and organization. Work Break down Structure (W BS)  Work Break down Structure is a process by which the whole project is divided (i.e., brokendown) into various sub-projects, the sub-projects into various tasks, the tasks into various sub- tasks and finally the sub-tasks into work-packages.  In the process of building up WBS, the project manager, all connected functional managers and all the connected staff work together and analyze all aspects of the project so that their collective wisdom will prevail. 92  Project Management PHHA 422 Chapter 6 Project Implementation and Control 93 Project Implementation  Also called as Project Execution  Project Implementation is a process whereby “project inputs are converted to project outputs”.  May be looked at as: o Putting in action the activities of the project. o Putting into practice what was proposed in the project document (i.e. transforming the project proposal into the actual project.) o Management of the project or executing the project intentions 94  Project Implementation The Important stages of Project Implementation are: 1. Clearances and approvals of org/govt. authorities 2. Project and engineering designs 3. Negotiations and contracting 4. Construction/Preparation 5. Training 6. Project Commissioning 95  Project Implementation Plan (PIP) The Project Implementation Plan (PIP) is a representation of the project in a structured format provided and completed by the Project Promoter. If PIP not carried out during the project design process and embodied in the project documents, it is carried out at the project activation stage. 96 Project Implementation Plan includes: 1. The project implementation schedule This is concerned with: ◦ What activities can produce expected project outputs? ◦ What is the sequence of these activities? ◦ What is the time frame for these activities? ◦ Who will be responsible for carrying out each activity? 97 Project Implementation Plan includes:  The following methods may be used to answer the above questions:  Gantt chart  Critical Path Method (CPM) or Net work analysis  Project Evaluation and Review Techniques (PERT)  Simple formats 98  What is a GANTT Chart?  The Gantt chart is also referred to as the progress chart.  It is a chart showing the timing of project activities using horizontal bars.  It is one of the techniques of project scheduling, which depicts the frequency of activities and determines the period of time for implementation. 99 Example: HIS project Activity  Indent & Procurement  Installation  Training  Pilot testing  HIS Implementation  Feedback J F M A M J J A S O N D Time period/ months 10 0  PERT/CPM  PERT ◦ Program Evaluation and Review Technique ◦ Developed by U.S. Navy for Polaris missile project ◦ Developed to handle uncertain activity times  CPM ◦ Critical Path Method Developed by Du Pont & Remington Rand ◦ Developed for industrial projects for which activity times generally were known ◦ The longest continuous path of activities through a project, which determines the project end date.  Today’s project management software packages have combined the best features of both approaches. 10 1  Critical Path 2 4 2 3 7 Start 1 1 3 3 6 1 5 1 1 A: 1-2-4-7  Critical path 3 + 2 + 3 + 1 = 9 months B: 1-2-5-6-7 Longest path 3 + 2 + 1 + 1 + 1 = 8 months through a network C: 1-3-4-7 Minimum project 3 + 1 + 3 + 1 = 8 months D: 1-3-5-6-7 completion time 3 + 1 + 1 + 1 + 1 = 7 months 10 2 PERT For Dealing With Uncertainty  So far, times can be estimated with relative certainty, confidence  For many situations this is not possible, e.g Research, development, new products and projects etc.  Use 3 time estimates m= most likely time estimate, mode. a = optimistic time estimate, b = pessimistic time estimate, and Expected Value (TE) = (a + 4m + b) /6 Variance (V) = ( ( b – a) / 6 ) 2 Std Deviation (δ) = SQRT (V) 10 3 Precedences And Project Activity Times Immediate Optimistic Most Likely Pessimistic EXP Var S.Dev Activity Predecessor Time Time Time TE V  a - 10 22 22 20 4 2 b - 20 20 20 20 0 0 c - 4 10 16 10 4 2 d a 2 14 32 15 25 5 e b,c 8 8 20 10 4 2 f b,c 8 14 20 14 4 2 g b,c 4 4 4 4 0 0 h c 2 12 16 11 5.4 2.32 I g,h 6 16 38 18 28.4 5.33 j d,e 2 8 14 8 4 2 10 4 The complete network d 6 2 (15,25) j a (8,4) (20,4) e (10,4) 1 f 7 3 b (14,4) (20,0) g c (4,0) (10,4) i (18,28.4) h 5 4 (11,5.4) 10 5 Figure 8-13 The complete Network EF=20 35 d 6 2 a (15,25) j (20,4) (8,4) b e 20 43 (20,0) (10,4) f CRIT. TIME = 43 1 3 7 (14,4) g c (4,0) (10,4) i (18,28.4) h 5 4 (11,5.4) 10 24 10 6 Critical Path Analysis (PERT) Activity LS ES Slacks Critical ? a 0 0 0 Yes b 1 0 1 c 4 0 4 d 20 20 0 Yes e 25 20 5 f 29 20 9 g 21 20 1 h 14 10 4 i 25 24 1 j 35 35 0 Yes 107 Assume, PM promised to complete the project in the fifty days. What are the chances of meeting that deadline? Calculate Z, where Z = (D-S) / V Example, D = 50; S(Scheduled date) = 20+15+8 =43; V = (4+25+4) =33 Z = (50 – 43) / 5.745 = 1.22 standard deviations. The probability value of Z = 1.22, is 0.888 1.22 10 8 What deadline are you 95% sure of meeting Z value associated with 0.95 is 1.645 D = S + 5.745 (1.645) = 43 + 9.45 = 52.45 days Thus, there is a 95 percent chance of finishing the project by 52.45 days. 10 9 The Simple Format – HIS Project 11 0 11 1 Project Implementation Plan (cont…) 2. The role of the implementing agency  The specific responsibilities of the key staff during project implementation and monitoring are outlined. 3. Beneficiary participation (hospital/HCO)  The involvement of the beneficiaries in planning and implementation and what is expected of them is spelt out. 11 2 Project Implementation Plan (cont.) 4. Organizational structure and staffing Here the following are sought:  Project structure for purposes of management  Qualifications and skills for the staff  Job descriptions and specifications for the staff  Technical assistance if needed 5. Financial management This looks at funds management, accounting period, financial reports and statements and how often they will be made? 11 3  Project Implementation Plan (cont.) 6. Reporting system  This looks at who will be reporting to whom and how often. There is need to design standard reporting formats. 7. Sustainability  The concept of sustainability is based on belief that project should result in benefits that have lasting effect. Project should be sustained beyond the life of funding - especially if it is a grant.  Project should not exhaust the available resources like raw materials and labor. 11 4 Project Implementation Plan (cont.) 8. Time control and remedial action Time taken to implement project activities is one measure of successfulness of supervision or monitoring of project implementation. Supervisor pays particular attention to time control measures, time scheduling and its supervision, time extension and postponement, damages for non-completion and defect or warranty period. 9. Supervision of implementation of project schedule This involves a set of checks and balances to ensure that the schedule is being adhered to. To ensure that the time schedule is being adhered to, the project activity time listing can be of great importance. 11 5 Project Activity Time Listing Activity Activity Activity Activity Activity Progress code Description duration earliest time latest time remark Start Finish Start Finish 11 6 Factors affecting Project Implementation  Factors that lead to success  Factors and problems that of projects lead to failure of projects  Org/Management  Financial Problems Commitment  Simplicity of Design  Management problems  Careful preparation  Technical problems  Good management  Org/Political problems  Involvement of beneficiaries/community 11 7 Factors affecting Project Implementation Other typical implementation problems Poor scheduling of projects leading to delays in implementation. Misallocation of funds Delay and sometimes lack of counterpart funding Lack of accountability and transparency Bureaucracy in decision-making. Selfishness/nepotism/favoritism by some project managers. 11 8 Factors affecting Project Implementation… Other typical implementation problems (cont.)  Weak monitoring systems  Natural calamities like drought, earthquakes, landslides, and hailstorms.  Policy changes  Migration of beneficiaries  Lack of team work  Lack of incentives for implementers and  Other related problems 11 9 Project Control  Project control means keeping the project on track according to the project plan.  Daniel Roman - The control process is concerned with assessing actual against planned technical accomplishment, reviewing and verifying the validity of technical objectives, confirming the continued need for the project, timing it to coincide with operational requirements, overseeing resource expenditures, and comparing the anticipated value with the costs incurred. 12 0 Project Control Information Monitoring To enable timely and effective project control, the project must be systematically tracked and observed. This requires setting up a project monitoring function. The monitoring function is composed of two activities: data collection and information reporting. Internal and External Project Control Both internal and external control systems are used to monitor and regulate project activities. Internal control refers to the contractor’s systems and procedures for monitoring work and taking corrective action. External control refers to the additional procedures and standards imposed by the client, including taking over project coordination and administration functions. Government contracts, for example, impose external control 12 1  Project Control Process  Project Control Process: In general, the process is achieved in three phases: 1. Setting performance standards, 2. Comparing these standards with actual performance, then 3. Taking necessary corrective action.  Three major aspects of the project control process: 1. Work authorization; 2. Collecting cost, schedule, and work progress data; and 3. Scope, quality, schedule, and cost control. 1. Work authorization begins with upper management, moves down through middle management, and ends with the work teams. 12 2  Project Control Process 2. Collecting cost, schedule, and work progress data Work orders and their cost accounts are the fundamental elements of project control. For each work order, data about actual costs and work progress is periodically collected and entered into the PCAS (network-based cost- accounting system) 3. Scope, quality, schedule, and cost control. A change in project scope is an alteration to the original, agreed-upon scope statement defined in the project plan and specified in the WBS. Quality control is managing the work to achieve the desired requirements and specification. The intent of schedule control is to keep the project on schedule and minimize schedule overruns. Cost control tracks expenditures versus budgets to detect variances. It seeks to eliminate unauthorized or inappropriate expenditures, and to minimize or contain cost changes. 12 3  Project Management PHHA 422 Chapter 7 Evaluating the Project Performance 12 4 Evaluating the Project  A major vehicle for evaluation is the project au­dit, a more or less formal inquiry into any aspect of the project.  The term evaluates means to set the value of or appraise.  Project evaluation ap­praises the progress and performance of a project compared to that project's planned progress and performance, or compared to the progress and performance of other, sim­ilar projects.  The evaluation also supports any management decisions required for the project. 12 5 Evaluating the Project  Therefore, the evaluation must be conducted and presented in a manner and format that assures management that all pertinent data have been considered.  The evaluation of a project must have credibility in the eyes of the management group for whom it is performed and also in the eyes of the project team on whom it is per­- formed.  Accordingly, the project evaluation must be just as carefully constructed and controlled as the project itself. 12 6 Purposes of Evaluation  1. Certainly the major element in the evaluation of a project is its success  2. Beyond the considerations of project success, another primary-purpose of evaluation is to translate the achievement of the project's goals into a contribution to the parent organization's goals.  These purposes—and there are many others—relate quite directly to how well the project team is meeting the stated project objectives. 12 7 The Project Audit  The project audit is a thorough examination of the management of a project, its methodology and procedures, its records, its properties, its budgets and expenditures, and its degree of completion.  It may deal with the project as a whole, or only with a part of the project.  The formal report may be presented in various formats, but should, at a minimum, contain comments on the following points:  Current status of the project: Does the work actually completed match the planned level of completion?  Future status: Are significant schedule changes likely? If so, indicate the natural changes.  Status of crucial tasks: What progress has been made on tasks that could decide the success or failure of the project?  Risk assessment: What is the potential for project failure or monetary loss?  Information pertinent to other projects: What lessons learned from the project being audited can be applied to other projects being undertaken by the organization  Limitations of the audit: What assumptions or limitations affect the data in tie audit? 12 8 The Project Audit  Depth of the Audit  There are several practical constraints that may limit the depth of the project audi­tor's investigation. Time and money are two of the most common (and obvious) lim­its on the depth of investigation and level of detail presented in the audit report.  Timing of the Audit  Like audit depth, the timing of a project audit will depend on the circumstances of a particular project.  Given that all projects of significant size or importance should be audited, the first audits are usually done early in the project's life.  The sooner a prob­lem is discovered, the easier it is to deal with.  Audits done later in the life cycle of a project are of less immediate value to the project, but are of more value to the parent organization. 12 9  The Project Audit Life Cycle  Project Audit Initiation:  This step involves starting the audit process, defining the purpose and scope of the audit, and gathering sufficient information to determine the proper audit methodology.  Project Baseline Definition:  The purpose of this phase is to establish performance standards against which the project's performance and accomplishments can be evaluated.  Establishing an Audit Database:  Once the baseline standards are established, exe­cution of the audit begins.  Preliminary Analysis of the Project:  After standards are set and data collected, judg­ments are made.  Audit Report Preparation:  This part of the audit life cycle includes the preparation of the audit report, organized by whatever format has been selected for use.  Project Audit Termination:  As with the project itself, after the audit has accom­plished its designated task, the audit process should be terminated. 13 0  The Project Audit Several essential conditions must be met for a credible audit:  A credible Auditor/Evaluator team  Sufficient Ac­cess to Records, and  Sufficient access to Personnel. 13 1 Project Management Information System – PMI Definition PMIS PMBOK 4th edition definition  The Project Management Information System (PMIS), part of the enterprise environmental factors, provides access to an automated tool, such as a scheduling software tool, a configuration management system, an information collection and distribution system, or web interfaces to other online automated systems used during the Direct and Manage Project Execution effort. 13 2 Project Management Information System 13 3 Characteristics of a PMIS Software  Project management information system can vary from something as simple as a File system containing Microsoft Excel documents, to a full blown enterprise PMIS software. Characteristics of a PMIS Software  A PMIS Software supports all Project management knowledge areas such as : Integration Management, Project Scope Management, Project Time Management, Project Cost Management, Project Quality Management, Project Human Resource Management, Project Communications Management, Project Risk Management, Project Procurement Management, and Project Stakeholders Management.  A PMIS Software is a multi-user application, and can be cloud based or hosted on-premise. 13 4  Computer Based Project Management Enterprise-Wide Project Management It is a web based PM System in which multiple project summaries are monitored from one central location It allows for collaborative planning among project managers and project executives, thus facilitating web based resource management and reporting ‘Microsoft Project Central’ and ‘Project Communicator’ are the two popular web based PM software tools Project PM Manag Softwa er re Internet Server Web Web Team Team Web III I Team 13 II 5 Project Life-Cycle and Project Cost  “Life Cycle Cost is the systematic analytical process of evaluating various alternative course of action with the intent of choosing the best way to employ scarce resources  Benjamin, S. Blanchard & Walter J Fabrycky - “ LCC is accumulation of all costs associated with the system as applied to the defined life-cycle” 13 6 Project Management PHHA 422 Chapter 8 Project Completion 13 7 Project Completion  As it must to all things, termination (completion) comes to every project.  At times, project death is quick and clean, but more often it is a long process;  The termination stage has a great deal to do with learning about the things that lead to success-or failure.  The process of termination is never easy, always complicated, and, as much as we might wish to avoid it, almost always inevitable.  Variety of conditions may lead to project termination.  Some projects are not actually ter­minated, but rather are severely slowed down. 13 8 Methods of Project Termination  There are four fundamentally different ways to close out a project: 1. Extinction 2. Addition 3. Integration and 4. Starvation. 13 9  Methods of Project Termination 1. Extinction Termination by Extinction The project is stopped. It may end because it has been successful and achieved its goals The new product/service has been developed and handed over to the client; the build­ing has been completed and accepted by the purchaser; or the software has been in­stalled and is running. 2. Addition Termination by addition Termination by addition is the process of institutionalizing a very successful project as a formal part of the parent organization. Project personnel, property, and equipment are simply transferred from the dying project to the newly born division. The change from project to division brings with it a sharply diminished sense of freedom to team members. 14 0 Methods of Project Termination 3. Integration Termination by integration The property, equipment, material, personnel, and functions of the project are distributed among the existing elements of the parent organization. The output of the project becomes a standard part of the operation systems of the parent. This is the most common and complex way of dealing with successful projects. 4. Starvation There is a fourth type of project termination, although strictly speaking, it is not a "ter­mination" at all. It is "slow starvation by budget decrement.” – Budget decrement – Political solution – Other issues 14 1  Critical success factors in Project Completion  Project Mission: Initial clearly defined goals and general directions.  Top Management Support: Willingness of top management to provide the necessary resources and authority/power for project success.  Project Schedule/Plan: A detailed specification of the individual action steps for project implementation.  Client Consultation: Communication, consultation, and active listening to all impacted parties.  Personnel: Recruitment, selection, and training of the necessary personnel for the project team.  Technical Tasks: Availability of the required technology and expertise to accomplish the specific technical action steps.  Client Acceptance: The act of "selling" the final project to its ultimate intended users.  Monitoring and Feedback: Timely provision of comprehensive control information at each stage in the implementation process.  Communication: The provision of an appropriate network and necessary data to all key actors in the project implementation.  Trouble-shooting: Ability to handle unexpected crises and deviations from plan. 14 2 Project Report 14 3 Project Report “Project Report is a detailed written document of various activities from start to end involved in the project. ” It provides a complete analysis of the inputs and outputs of a project It enables the entrepreneur/sponsor to understand all the activities related to Project 14 4 Preparation of Project Report  Who are the target audiences?  Different levels of management require different reports  Top – Brief, Risk Analysis, viability – summary, mile stones, cost plans  Middle – PERT chats, Management. brief – PERT Output, tenders, contracts  Supervisory – Dept. wise plans, purchases, section info – Detailed PR, time, cost 14 5 Scope of Project Report PR includes information on the following aspects: Economic aspects – economic justification for investment Technical aspects – needed technology, equipment and machinery Financial Aspects – total investment, ROI Production aspects – details of product/service Managerial aspects – who will manage the project? 14 6 Structuring Project Report Suggested structure  Abstract  Introduction  Literature review  Method  Results  Discussion  Conclusions  References  Appendices 14 7 Sustainable Project Management  Sustainability in the context of sustainable development is defined by the World Commission on Environment and Development (1987) as ‘forms of progress that meet the needs of the present without compromising the ability of future generations to meet their needs’.  Sustainable Project Management is the management of project with consideration of the Economic, Social and Environmental impact of the project, its result and its effect, for now and future generations. 148 References Healthcare Project Management by Kathy Schwalbe and Dan Furlong ,Ist Edition,Schwalbe Publishing ,2013, ISBN- 13: 978-0982800355-ISBN-10: 0982800355 https://www.amazon.com/Healthcare-Project-Management-Kat hy-Schwalbe/dp/0982800355 Fundamentals of Project Management by Joseph Heagney, 4th edition, American Management Association, 2011, ISBN-9780814417485 - ISBN-13: 978-0-8144-1748-5 https://www.amazon.com/Fundamentals-Project-Management- Worksmart-Heagney/dp/0814417485 A Guide to the. Project. Management. Body of. Knowledge. (PMBOK® Guide) http://www.cs.bilkent.edu.tr/~cagatay/cs413/PMBOK.pdf 149 Wish you all the best…