Project Management Notes PDF

Chapter 1 Introduction What is Project Management? Project management is a comprehensive and dynamic field that involves the application of knowledge, skills, tools, and techniques to project activities to meet project requirements. It requires a blend of both technical and managerial expertise, along with a deep understanding of human behavior and organizational dynamics. What is a Project? A project is a temporary endeavor with a defined start and end date undertaken to create a unique product, service, or result. Projects are conducted by people to meet established goals within specific parameters of cost, schedule, and quality. All projects, to a certain extent, are unique and involve the coordinated undertaking of interrelated activities to achieve a specific goal. Why are projects important? - Shortened product life cycles - Narrow product launch windows - Increasingly complex and technical products - Emergence of global markets Key Elements of a Project Definition Complex, one-time processes: Projects often involve a series of complex tasks that are not routine or repetitive. Limited by budget, schedule, and resources: Projects operate within defined constraints, including a budget, timeline, and available resources. Developed to resolve a clear goal or set of goals: Each project has a specific purpose and defined objectives to be achieved. Customer-focused: Projects aim to deliver value and meet the requirements of a customer, whether internal or external to the organization. Project Success and Failure: While project management offers numerous benefits, success is not guaranteed. Many projects face challenges such as cost overruns, schedule delays, and failure to meet client expectations. The sources highlight the importance of thorough planning, communication, leadership, and stakeholder engagement as key contributors to project success. 1 4 dimensions of success Project Life Cycles: The concept of the project life cycle, with its distinct phases (conceptualization, planning, execution, and termination), is introduced. Understanding these phases is essential for planning and controlling a project effectively. The sources explain how uncertainty, client interest, project stake, creativity, and resource requirements fluctuate throughout the project life cycle. Project life cycle stages Project life cycles and their effects Project vs. Process Process Project 1. Repeat process or product 1. New process or product 2. Ongoing 2. One shot – limited life 3. People are homogeneous 3. More heterogeneous 2 4. Systems in place to integrate efforts 4. Systems must be created to integrate efforts 5. Performance, cost, & time known 5. Performance, cost & time less certain 6. Part of the line organization 6. Outside of line organization 7. Supports of established practice 7. Violates established practice Projects are distinct from ongoing operational processes in several ways. Processes are typically ongoing and repetitive, involve homogeneous teams, and operate within established systems. For a process, the cost and time are mostly unknown, while the cost and time are well-known for a project. General Project Characteristics Complexity, uniqueness, defined timelines, and resource constraints. - Projects are temporary endeavors (ad-hoc) that are undertaken to create a unique product or service and have a clear beginning and end. - Projects are often considered building blocks for the design and execution of organizational strategies. - Projects are responsible for the creation of new and improved products, services, and organizational processes. - They also provide a strategy for the management of change within the organization. - Projects involve crossing functional and organizational boundaries, and traditional management functions apply to projects. - Traditional management functions of planning, organizing, motivating, directing, and controlling apply - Project success is measured by meeting customer requirements within the constraints of the project, such as cost, schedule, and resources. - Projects are terminated when the project goals are met. Project Management Skills Project management skills are essential for effectively coordinating a project from initiation to completion. These skills encompass both soft skills (communication, interpersonal skills, motivation, and organization) and technical skills (planning, forecasting, risk management, and budgeting). Chapter 2 The Organizational Context of Project Management Projects and Organizational Strategy Strategic management involves formulating, implementing, and evaluating decisions across different functions to help an organization achieve its objectives, mission, and vision. This includes: - Developing vision and mission statements - Formulating, implementing, and evaluating strategies. - Setting objectives. 3 - Making cross functional decisions Projects should align with an organization's overall strategic goals. For example, projects can be initiated to: - Increase profitability. - Improve efficiency. - Gain a competitive advantage. - Meet customer demands. TOWS Matrix TOWS stands for Threats, Opportunities, Weaknesses, and Strengths. Stakeholder Management Stakeholders are individuals or groups with an active interest in a project who can positively or negatively influence its development. They can include: - Internal Stakeholders: top management, accountants, other functional managers, project team members. - External Stakeholders: clients, competitors, suppliers, environmental groups, political groups, consumer groups, and other intervenor groups. Stakeholder analysis involves: - Identifying stakeholders. - Understanding stakeholders (their interests, expectations, influence, and potential impact). - Managing stakeholders (communication, engagement, and addressing concerns). Stakeholder Mapping: Power/Interest Grid This grid categorizes stakeholders based on their power to influence the project and their level of interest in it. The four categories are: - High power/high interest: These stakeholders require close attention and engagement. - High power/low interest: It's important to keep these stakeholders satisfied but not necessarily involve them in every detail. - Low power/high interest: These stakeholders should be kept informed, and their input should be considered. - Low power/low interest: These stakeholders require minimal effort. 4 Organizational Structure's Impact on Project Management Organizational structure impacts project management by influencing: - Resource allocation: The structure determines how resources are distributed across projects and departments. - Decision-making: Authority and responsibility for project decisions are defined by the structure. - Communication flow: The structure affects how information is shared and communicated within the project team and across the organization. - Project team roles: The structure dictates the roles and responsibilities of project team members. Key elements: - Designates formal reporting relationships o Number of levels in the hierarchy o Span of control - Groupings of o Individuals into departments o Departments into the total organization - Design of systems for o Effective communication o Coordination o Integration across departments Forms of Organizational Structure Functional organization: Projects are managed within functional departments. - The project manager has least authority 5 Project organization: Projects are managed by dedicated project teams with their own hierarchy. Matrix organization: A hybrid structure combining aspects of functional and project organizations. Project Management Offices (PMOs) PMOs are centralized units that oversee and improve project management practices. They serve as: - Resource centers: Offering expertise in project management skills, tools, and templates. - Repositories of lessons learned: Capturing and sharing knowledge from past projects. - Centers for project management excellence: Promoting best practices and standardization. Forms of PMOs include: 6 - Weather station: Monitoring and tracking project progress. - Control tower: Providing support and guidance to project managers. - Resource pool: Maintaining a group of skilled project professionals. Organizational Culture's Influence on Projects Organizational culture refers to the shared values, beliefs, and norms that shape behavior within an organization. - Key elements defining organizational culture: o Values and beliefs o Norms o Symbols and artifacts o Leadership and management style o Stories and myths o Language and communication It influences projects by impacting: - Communication styles - Risk tolerance - Decision-making processes - Teamwork and collaboration - Leadership styles - Resource allocation - Stakeholder engagement - Change management - Performance measurement - Innovation and flexibility Defining organizational culture - Hierarchy culture: o Highly structured and process-oriented (procedure, authority and transparent o Clear expectation from employee o Leadership style: leader = coordinators who focus on efficiency, stability, and smooth operations o Value: order, rules and regulations - Clan culture: o Family like business. (collaboration across teams, have horizontal structure) o Mentoring and sense of belonging o Leadership style: mentors who are approachable and supportive o Values: teamwork, participation, and trustworthiness - Adhocracy culture: o Creative, flexible, organic and growth-oriented (low authority) 7 o Leadership style: innovators/risk-takers who encourage experimentation and adaptability o Values: innovation, growth, and the ability to adapt to changing environments - Market culture: o Highly competitive, with the goal of profit and performance. Often focus on customer satisfaction and less on employee happiness o Leadership style: tough, demanding, prioritize efficiency and productivity o Values: competitiveness, goal achievement, and customer focus Chapter 3 Project Selection and Portfolio Management Project Selection Project selection is the process of evaluating project ideas and choosing those with the highest priority based on their alignment with organizational goals and available resources. It involves: - Identifying potential projects: Organizations can generate project ideas through various channels, including: o Voice of the Business (VoB): Strategic initiatives or operational needs identified by business units or leadership. o Voice of the Customer (VoC): Feedback and requests from customers regarding desired features, products, or services. o Voice of the Employees (VoE): Suggestions and innovations proposed by employees within the organization. o Voice of the Processes (VoP): Analysis of existing processes to identify areas for improvement or automation. - Evaluating and prioritizing projects: Organizations can use different methods to evaluate and rank potential projects based on specific criteria, including: o Alignment with strategic goals: Assessing how well a project supports the organization's overall strategic objectives. o Potential benefits: Analyzing the expected returns, value creation, or impact of a project. o Feasibility: Determining the likelihood of successful project completion considering resources, technology, and risks. o Resource availability: Evaluating the availability of necessary resources such as budget, personnel, and equipment. - Selecting and initiating projects: After careful evaluation, organizations choose the projects that best meet their needs and initiate the planning and execution phases. - Reviewing projects: Organizations may review and reassess selected projects at different stages to ensure continued alignment with strategic goals and adapt to changing circumstances. 8 Project Screening Project screening aims to narrow down the list of potential projects by applying specific criteria and methods to identify those that are most promising and aligned with organizational objectives. Approaches to project screening: - Checklist model: o Involves creating a list of criteria deemed important for project selection and evaluating each project idea against those criteria. o Requires agreement among stakeholders on the criteria and their relative importance. o Evaluations are typically expressed as high, medium, or low ratings for each criterion. Projects accumulating the highest ratings are considered more favorable. o Disadvantage: Fail to resolve trade- off issues. What if some criteria are more important than others? How will relative, or weighted, importance affects our final decision. o Example: A software company might consider criteria such as cost, profit potential, time to market, and development risks when evaluating new software development projects. - Simplified scoring models: o Assigns weights to each criterion based on its relative importance. o Projects are graded on each criterion using a predefined scoring scale. o The weighted scores for each criterion are summed to calculate an overall project score. o Projects with higher overall scores are considered more desirable. o Disadvantage: Scoring models like 1-3 are easy to use but inaccurate because numbers represent rankings, not precise values, and differences between them aren’t equal, making mathematical operations like adding or averaging incorrect o Example: Using the software company example, weights could be assigned to cost (0.3), profit potential (0.4), time to market (0.2), and development risks (0.1). - Analytic Hierarchy Process (AHP): 9 o A multi-criteria decision-making method that involves: ▪ Constructing a hierarchy of criteria and sub-criteria. ▪ Allocating weights to criteria through pairwise comparisons. ▪ Assigning numerical values to evaluation dimensions (e.g., good, fair, excellent). ▪ Calculating scores for each project by summing the products of numeric evaluations and weights. o Example: A company evaluating product development projects might use criteria such as gaining new market access, improving customer experience, and resource requirements. - Profile models: o Visually represent project options based on their risk and return profiles. o Projects are plotted on a graph with risk on one axis and return on the other. o This allows decision-makers to compare projects and identify those that offer the desired balance of risk and return. - Financial models: o Use financial metrics to evaluate project feasibility and profitability. o Common financial models include: ▪ Payback Period: Calculates the time required for a project's cumulative cash inflows to equal its initial investment (breakeven point). Lower numbers are better = faster payback Disadvantage: disregards the time value of money ▪ Net Present Value (NPV): Determines the present value of a project's future cash flows, discounted at a specified rate of return, minus the initial investment. Projects with positive NPV are generally considered financially viable. ▪ Internal rate of return IRR: the discount rate that makes a project’s NPV zero. What rate of return will this project earn? Higher IRR values are better! IRR must be higher than the minimum acceptable rate of return (MARR) MARR = hurdle rate is a minimum acceptable rate of return or target rate that the investors are expecting to receive on an investment Portfolio Management Portfolio management involves selecting, prioritizing, and overseeing a collection of projects to align with strategic goals and maximize organizational value. Key aspects: 10 - Strategic alignment: Ensuring that projects within the portfolio contribute to the organization's overall strategic objectives - Risk management: Assessing and mitigating risks across the portfolio to minimize potential negative impacts. - Resource optimization: Allocating resources efficiently across projects to avoid overallocation or underutilization. - Value maximization: Selecting and prioritizing projects that offer the highest potential returns and value creation. - Benefits of Portfolio Management: o Improved project success rates: By carefully selecting and managing projects, organizations can increase the likelihood of achieving project objectives. o Better strategic alignment: PPM ensures that projects contribute to the organization's overall goals and priorities. o Optimized Resource Use: PPM ensures that resources are allocated efficiently across all projects, avoiding overuse or underuse. o Improved Risk Management: Identifying and managing risks at the portfolio level helps in minimizing the impact of project failures on the organization. - Portfolio management process: 1. Clarify business objectives/strategies: Defining the organization's strategic goals and priorities to guide project selection. 2. Capture requests and identify project ideas: Gathering project proposals and ideas from various sources. 3. Evaluate, prioritize and select the best project ideas: Applying screening criteria and methods to evaluate and rank potential projects based on their alignment with strategic goals, potential benefits, feasibility, and resource availability. 4. Validate portfolio feasibility and resource allocation: Ensuring that the selected projects can be executed within the available resources and adjusting the portfolio composition if necessary. 5. Manage and monitor the portfolio: Tracking project progress, performance, and risks to make informed decisions and adjustments as needed. Example A technology company specializing in software development might have a portfolio of projects aligned with strategic goals such as expanding into new markets, improving existing products, and reducing operational costs. The company could use a combination of screening methods to evaluate and prioritize projects, considering factors such as market potential, customer feedback, technological feasibility, and resource requirements. The portfolio management process would involve regularly reviewing and adjusting the project mix to ensure ongoing alignment with strategic objectives and market dynamics. 11 Chapter 4 Leadership and the project manager Leadership Leadership is crucial in project management. Project managers need to possess strong leadership skills to guide their teams effectively, motivate members, and achieve project goals. Definition of leadership: "The ability to inspire confidence and support among the people who are needed to achieve organizational goals." Project management is particularly leader intensive. Key Tasks of a Project Manager Project managers act as mini-CEOs, handling both technical aspects ("hard" skills) and people management ("soft" skills) of the project. Key tasks of a project manager: - Acquiring project resources: Project managers are responsible for securing the necessary resources for their projects, including budget, personnel, equipment, and materials. o Projects may face underfunding for various reasons, such as: ▪ Vague project goals ▪ Lack of a top management sponsor ▪ Understated project requirements ▪ Competition for resources among multiple projects ▪ Distrust between top management and project managers - Motivating and building teams: Project managers need to foster a positive and collaborative team environment, motivate team members to perform their best, and address any conflicts or challenges that may arise. - Having a vision and fighting fires: Effective project managers need to have a clear vision for the project, anticipate potential problems, and take proactive steps to address them. They should also be able to handle unexpected issues and make quick decisions when necessary. - Communicating: Project managers are responsible for communicating effectively with all stakeholders, including the project team, sponsors, customers, and other relevant parties. They need to keep everyone informed about project progress, challenges, and decisions. Leaders vs. Managers While the terms "leader" and "manager" are often used interchangeably, there are some key differences: - Leaders focus on inspiring, motivating, and empowering others to achieve a shared vision. They often drive innovation and change within an organization. 12 - Managers are responsible for planning, organizing, and controlling resources to achieve specific goals. They focus on efficiency, effectiveness, and operational excellence. Effective project managers need to be both strong leaders and skilled managers, balancing the need for inspiration and motivation with the practicalities of project execution and control. Key Qualifications of an Effective Project Leader Several qualifications are essential for effective project leadership: - Strong Leadership Skills: o Visionary thinking: The ability to see the big picture and articulate a compelling vision for the project, inspiring and guiding the team toward achieving it. o Decision-making: The ability to make informed, timely decisions, even under pressure, weighing various factors and considering potential consequences. o Motivational: The ability to inspire and motivate team members to stay committed to the project and perform their best, fostering a positive and encouraging work environment. - Excellent Communication Skills: o Clarity: The ability to communicate ideas, expectations, and instructions clearly and effectively to team members and stakeholders, ensuring everyone is on the same page. o Active listening: The willingness to listen attentively to team members' feedback, concerns, and ideas, fostering open communication and ensuring everyone feels heard and understood. o Conflict resolution: The ability to address and resolve conflicts that may arise within the team, mediating disagreements and finding mutually acceptable solutions. - Strong Organizational Skills: o Time management: The ability to manage time efficiently, prioritize tasks, and ensure that the project stays on schedule. o Prioritization: The ability to identify the most important tasks and focus on those that are critical for project success, delegating less crucial tasks when necessary. o Attention to detail: The ability to keep track of all project details, ensuring that nothing is overlooked and that all aspects of the project are managed effectively. - Technical Expertise: o Project management knowledge: Proficiency in project management methodologies (e.g., Agile, Waterfall) and tools (e.g., MS Project, Trello), enabling effective planning, execution, and control of the project. 13 o Industry-specific knowledge: Understanding the technical aspects of the project and the industry in which it operates, enabling informed decision- making and effective communication with technical teams. - Problem-Solving Abilities: o Analytical thinking: The ability to analyze complex situations, identify potential problems, and develop effective solutions. o Critical thinking: The ability to evaluate information objectively, identify biases, and make sound judgments based on evidence and logical reasoning. o Creative thinking: The ability to generate new ideas, explore innovative solutions, and think outside the box to overcome challenges. - Teamwork and Collaboration Skills: o Team building: The ability to build strong, cohesive teams where members work effectively together, supporting and motivating each other to achieve project goals. o Collaboration: The ability to foster a collaborative work environment where team members share information, ideas, and expertise openly and effectively. o Interpersonal skills: The ability to build strong relationships with team members, stakeholders, and other individuals involved in the project, fostering trust, respect, and open communication. - Risk Management Skills: o Risk identification: The ability to proactively identify potential risks that could impact the project. o Mitigation planning: The ability to develop and implement strategies to mitigate identified risks, reducing their likelihood or potential impact. o Contingency planning: The ability to prepare contingency plans to handle unforeseen challenges or events that could disrupt the project, ensuring that the project team can respond effectively to unexpected situations - Accountability: o Responsibility: Taking ownership of the project's outcomes, both successes and failures, acknowledging mistakes and learning from them. o Ethical integrity: Acting with honesty and integrity, ensuring that all actions are ethical and responsible, and upholding the highest professional standards. - Stakeholder Management Skills: o Stakeholder identification: The ability to identify all individuals or groups who have an interest in the project, including sponsors, customers, team members, and other relevant parties. o Stakeholder communication: The ability to communicate effectively with stakeholders, keeping them informed about project progress, addressing their concerns, and managing their expectations. o Expectation management: The ability to manage and align stakeholder expectations with the project's scope and objectives, ensuring that everyone understands the project's goals and limitations.7 Project Management and Ethics The Project Management Institute (PMI) has established a code of ethics and professional conduct for project managers.7 Key elements of the PMI Code of Ethics: 14 - Responsibility: Taking ownership of one's actions and decisions, acting in a professional and responsible manner, and fulfilling commitments made to stakeholders. - Respect: Treating all individuals with respect, regardless of their position, background, or beliefs, fostering a positive and inclusive work environment. - Fairness: Making impartial decisions, treating all parties fairly, and ensuring that everyone has an equal opportunity to contribute and succeed. - Honesty: Acting with integrity, being truthful in all communications, and upholding ethical standards in all project activities. Chapter 5 Scope management Introduction to Project Scope Project scope is the heart of a project, encompassing both the work content and the expected outcomes. It establishes boundaries for the project, defining the goals, deadlines, and deliverables to be achieved. Scope management involves defining and controlling what is included and excluded from the project. A well-defined project scope helps translate the project idea into a workable concept, specifying all the necessary work and considerations to achieve the desired outcome. Conceptual Development Conceptual development focuses on addressing project objectives effectively. Key steps in conceptual development: - Problem statement: Articulate the problem or opportunity that the project aims to address. - Requirements gathering: Collect and document the needs, expectations, and specifications of stakeholders, including: o Product-related requirements: The features and functionalities desired in the project outcome. o Quality requirements: Minimum acceptable standards for the overall project quality. o Performance requirements: Expectations regarding the project's performance and the standards it must maintain. - Constraints: Identify any limitations or restrictions that may influence project development, such as time, budget, or resources. - Alternative analysis: Explore and evaluate different approaches or solutions to meet project objectives, considering their feasibility, risks, and benefits. - Project objectives: Define clear, measurable, achievable, relevant, and time-bound (SMART) objectives that align with the project goals. - Business case: Develop a compelling justification for the project, outlining its benefits, costs, risks, and alignment with organizational strategies. 15 Successful conceptual development requires: - Reducing overall project complexity. - Clearly stating goals and objectives - Providing reference points for evaluation. - Ensuring a complete understanding of the problem or opportunity. - For internal projects, gaining commitment from stakeholders and securing necessary support. Documentation in Scope Management Statement of Work (SOW): - A detailed summary of the conceptual development, outlining the expectations of the client, the problem to be addressed, and the work required to complete the project. - Typical contents of an SOW: o Introduction and background. o Scope of work (technical description, requirements, and expectations). o Timeline, constraints, and milestones. o Place of performance. o Client expectations. o Other terms and conditions (e.g., payment terms, acceptance criteria, responsibilities). Project Charter: - A formal document authorizing the project's existence and empowering the project manager to allocate resources. - It signifies company approval of the project after fulfilling conceptual development requirements. - In some cases, the signed SOW serves as the project charter. Scope Statement: - Provides a comprehensive description of the work needed to deliver the project's output within budget and on time. - Focuses on the "how" of project execution, serving as the basis for day-to-day management. - It differs from the SOW by outlining how the work will be done, while the SOW focuses on what needs to be accomplished. The Scope Statement Process: 1. Detail project goal criteria, including: o Cost o Schedule o Performance o Deliverables o Review and approval gates 2. Establish a Work Breakdown Structure (WBS). 3. Develop the project management plan. 4. Create a scope baseline. 16 Work Breakdown Structure (WBS) Definition: - "A hierarchical decomposition of the total scope of work to be carried out by the project team to accomplish the project objectives and create the project deliverables. - A process that breaks down the project's overall mission into smaller, increasingly specific tasks, defining the building blocks for project construction. Components of a WBS: - Work Packages: Individual, manageable units of work that form the lowest level of the WBS. - Deliverables: Major project components, representing significant outcomes or products. - Sub deliverables: Supporting elements or components of the main deliverables. - The Project: The overall project under development. Benefits of using a WBS: - Clarifies and reinforces project objectives. - Provides a logical and organized structure for the project. - Establishes a mechanism for control and monitoring. - Facilitates communication and reporting of project status. - Improves communication and coordination among team members. - Demonstrates a clear control structure for managing the project. Responsibility Assignment Matrix (RAM) Purpose: Defines roles and responsibilities in cross-functional projects. RACI Matrix: A common type of RAM, where: - R (Responsible): Individuals responsible for completing a task or making a decision (multiple responsible parties possible). - A (Accountable): The single individual ultimately accountable for approving completed tasks or decisions. - C (Consulted): Subject-matter experts who provide input and expertise during task completion. - I (Informed): Individuals kept informed about progress but who don't have active roles in task execution. 17 Scope Reporting and Project Closeout Scope Reporting: - Determines the information reported, recipients, frequency, and methods of information acquisition and dissemination. - Part of the project management plan. - Typical project reports include: o Cost status o Schedule status o Technical performance status Project Closeout: - Defines when a project is considered complete and outlines the deliverables to be submitted. - Purpose of closeout documentation: o Resolving disputes o Training project managers o Facilitating auditing - Contents of closeout documentation: o Historical records o Post-project analysis o Financial closeout Work Authorization and Contractual Setting Work Authorization: - Formal approval to begin work on the project. - Often involves sign-off on project plans and specifications after completing scope definition, planning documents, and contractual agreements. - Scope Baseline: The approved version of the scope statement, WBS, and WBS dictionary, used as a reference for comparison and changed only through formal procedures. Contractual Setting: - Contracts can range from simple agreements to complex legal documents. - Types of contracts: 18 o Cost-Plus Contracts: Suitable for projects with uncertain outcomes or where it's challenging to determine costs in advance. Costs are reimbursed, and the contractor receives a fee for profit. o Lump-sum contracts: the contractor is required to perform all work at an initially negotiated price. The contractor has higher risk than the client. Chapter 6 Project team building, conflict and negotiation Introduction Importance of Teams: Project management heavily relies on effective teams. Projects often involve diverse tasks and expertise, requiring collaboration among individuals with various skills. Project Manager as a Leader: Project managers act as leaders who guide and motivate their teams to achieve project goals. They need to possess strong leadership and interpersonal skills to manage team dynamics, resolve conflicts, and foster a positive and productive work environment. Building a Project Team Negotiating with Functional Managers: Project managers often need to negotiate with functional managers to secure the necessary team members with the right skills and experience. Assembling a High-Performing Team: - Clear Goals and Objectives: Establishing a shared understanding of the project goals, objectives, and deliverables is crucial for team alignment and motivation. - Effective Communication: Open and regular communication is essential for keeping team members informed, addressing concerns, and fostering collaboration. - Defined Roles and Responsibilities: Clearly outlining each team member's role and responsibilities helps prevent misunderstandings and ensures accountability. - Trust and Respect: Creating a culture of trust and respect encourages open communication, constructive feedback, and mutual support among team members. Stages in group development: - Forming: Team members get acquainted and are polite, with unclear roles and goals - Storming: Conflicts and disagreements arise as members assert their ideas - Norming: The team starts to work well together, with clearer roles and improved communication - Performing: The team works efficiently towards goals with high collaboration and autonomy - Adjourning: The project ends, and the team disbands, reflecting on their achievements 19 Conflict Management in Project Teams Inevitability of Conflicts: Conflicts are natural in teams due to differing perspectives, priorities, or work styles. Importance of Addressing Conflicts: Unresolved conflicts can lead to decreased productivity, reduced morale, and project delays. Conflict Resolution Strategies: - Active Listening: Encourage team members to express their views and concerns while listening attentively and without judgment. - Collaboration and Compromise: Seek solutions that address the needs and interests of all parties involved. - Mediation: Involve a neutral third party to facilitate communication and help find mutually acceptable resolutions. - Escalation: Involve senior management or project sponsors if conflicts cannot be resolved within the team. Guidelines for Dealing with Conflicts The sources provide a list of guidelines to effectively manage conflicts within project teams. These guidelines emphasize communication, understanding, and finding solutions that benefit the project and the team. While the sources focus on conflict resolution within the team, these guidelines can also be helpful for managing conflicts with stakeholders outside the project team. 1. Open Communication: Establish a culture of transparency and open dialogue, encouraging team members to share their thoughts and concerns constructively 2. Early Identification and Address: Proactively identify potential conflicts and address them before they escalate, fostering an environment where issues can be raised and discussed openly. 3. Clarify Roles and Responsibilities: Ensure each team member understands their role, responsibilities, and how their work contributes to the project. This clarity helps minimize misunderstandings and potential conflicts arising from overlapping or unclear responsibilities. 4. Establish Clear Processes: Define processes for handling disagreements and escalating issues. This provides a framework for addressing conflicts in a fair and systematic manner. 5. Focus on Interests, Not Positions: Encourage team members to focus on shared goals and underlying interests rather than rigid positions. This helps find solutions that benefit everyone involved. 6. Problem-Solving Approach: Approach conflicts as problems to be solved collaboratively, emphasizing finding solutions that meet project needs and team objectives. 7. Respectful Communication: Maintain respectful communication, even during disagreements. Encourage active listening and empathy to understand different perspectives and foster a positive team environment. 8. Choose the Right Setting: Consider the appropriate setting for addressing conflicts. Some issues can be resolved through one-on-one conversations, while more complex or team-wide conflicts might require group discussions. 20 9. Use a Mediator if Necessary: If conflicts escalate and cannot be resolved within the team, consider involving a neutral third party, such as a project sponsor, HR representative, or an external mediator. 10. Negotiate and Compromise: Be willing to negotiate and compromise to find solutions that address the key concerns of all parties. Flexibility in project tasks, schedules, or resource allocation can help accommodate different needs and perspectives. 11. Involve Senior Management When Needed: Escalate conflicts to senior management or project sponsors when necessary, particularly when conflicts involve strategic decisions, resource allocation, or situations where the team cannot reach a resolution independently. 12. Learn and Improve: View conflicts as opportunities for learning and improving team dynamics. After resolving a conflict, conduct a review or debrief to understand its root causes and identify ways to prevent similar conflicts in the future. 13. Practice Fairness and Objectivity: Treat all team members fairly and objectively. Avoid favoritism and base decisions on facts and project needs rather than personal preferences. 14. Adapt Conflict Resolution Style: Different conflicts require different approaches. Be flexible and adapt your conflict resolution style to the specific situation. Consider factors such as the severity of the conflict, the individuals involved, and the project context. Negotiation in Project Management Purpose of Negotiation: Negotiation is often necessary in projects to resolve conflicts, secure resources, and reach agreements with stakeholders. Effective Negotiation Techniques: - Preparation: Clearly define your objectives, understand the other party's interests, and gather relevant information. - Active Listening: Carefully listen to the other party's perspectives and concerns to identify common ground and areas of potential agreement. - Communication: Communicate clearly and respectfully, focusing on finding mutually beneficial solutions. - Flexibility and Compromise: Be willing to be flexible and explore different options to reach a compromise that satisfies both parties. Importance of Documentation The sources emphasize the importance of documentation in project management, particularly for scope management. Key documents include: - Statement of Work (SOW): This document defines the project scope, outlining the work to be done, deliverables, and client expectations. It is crucial for ensuring a shared understanding between the project team and the client. - Scope Statement: This document describes how the project work will be executed, providing a detailed breakdown of tasks, responsibilities, and timelines. It serves as the basis for managing the project on a day-to-day basis. 21 - Responsibility Assignment Matrix (RAM): This matrix clarifies roles and responsibilities within the project team, ensuring that each member understands their role and whom to consult or inform about their work. Conclusion Effective team building, conflict management, and negotiation are essential skills for project managers. By fostering a positive team environment, addressing conflicts constructively, and negotiating effectively, project managers can enhance team performance, improve project outcomes, and increase the likelihood of project success. Chapter 7 Risk management Understanding Project Risk Definition of Project Risk: The sources define project risk as "an uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives" Impact of Risk: Project risks can impact various aspects of a project, including its scope, cost, schedule, quality, and overall success. Event risk = (probability of event)(consequences of event) Importance of Risk Management: Proactive risk management is crucial for identifying potential risks, assessing their likelihood and impact, developing strategies to mitigate them, and controlling and documenting the process. This helps to: - Minimize negative impacts of risks. - Capitalize on potential opportunities. - Improve the chances of project success. Four Stages of Risk Management The sources outline a four-stage process for managing project risks: 1. Risk Identification: This stage involves determining specific risk factors that could reasonably be expected to affect the project. 2. Analysis of Probability and Consequences: Once risks are identified, this stage focuses on evaluating their likelihood of occurrence and the potential impact (consequences) on the project if they occur 3. Risk Mitigation Strategies: This stage involves developing and implementing strategies to minimize the potential negative impact of identified risks 4. Control and Documentation: This stage focuses on establishing processes for monitoring and controlling risks, documenting risk management activities, and creating a knowledge base for future projects. Risk Identification Approaches to Risk Identification 22 - Risk Clusters: Grouping risks into categories can facilitate a more structured approach to identifying them. Common risk clusters include: o Financial Risk: Relates to financial aspects of the project, such as funding issues, cash flow problems, and budget overruns o Technical Risk: Pertains to technological challenges, like technology obsolescence, integration issues, and technical feasibility o Commercial Risk: Involves risks associated with market factors, competition, customer behavior, and market acceptance. o Execution Risk: Focuses on risks related to project execution, such as inadequate resources, unskilled workforce, and schedule delays. o Contractual/Legal Risk: Covers risks arising from contractual obligations, legal issues, regulatory changes, and compliance requirements. - Bottom-Up Approach: This approach involves gathering input from individuals working at different levels within the project team to identify potential risks. It leverages the knowledge and experience of those closest to the project work. - Top-Down Approach: This approach utilizes the expertise of senior management, project sponsors, and subject matter experts to identify risks based on their broader organizational perspective and experience. Methods for Identifying Risk Factors Brainstorming Meetings: Engaging project team members, stakeholders, and experts in brainstorming sessions can generate a diverse set of potential risks4. Expert Opinion: Utilizing the knowledge and judgment of experts in specific areas can help identify risks that might not be apparent to the project team6. The Delphi method, which involves multiple rounds of questionnaires and feedback, is a structured approach to gathering expert opinions and identify risk. Past History: Reviewing historical data from previous projects, particularly within the same organization or industry, can reveal recurring risks and their potential impact7. Multiple (Team-Based) Assessments: Assembling teams with diverse skills and perspectives can contribute to a more comprehensive risk identification process8. Output: Risk Breakdown Structure (RBS) Purpose: A Risk Breakdown Structure (RBS) provides a hierarchical representation of identified risks, starting with broader categories and breaking them down into more specific risks at lower levels. Benefits: An RBS helps to: - Organize and categorize risks. - Facilitate a systematic analysis of risks. - Communicate risks effectively among stakeholders. Analysis of Probability and Consequences Risk Impact Matrix - Purpose: A Risk Impact Matrix is used to prioritize risks based on their likelihood of occurrence and their potential impact on the project. 23 - Structure: A matrix is typically created with likelihood on one axis and impact on the other. Each risk is assigned a score for both likelihood and impact, and these scores are combined to determine a risk rating. Typical Risk Rating Calculation: Likelihood x Impact = Risk Rating Considerations - Scaling: The sources recommend using a scale of 1 to 5 for both likelihood and impact, but different scales may be used depending on the project context1314. - Subjectivity: Assigning likelihood and impact scores often involves subjective judgments. It's crucial to have a clear understanding of the rating criteria and to involve multiple stakeholders in the assessment process. Risk Mitigation Strategies Strategies - Accept Risk: This involves acknowledging the risk but taking no action if the likelihood or impact is low and considered acceptable - Avoid Risk: This strategy aims to eliminate the risk entirely by addressing its root causes. It may involve changing the project scope, using different technologies, or adjusting project plans - Minimize Risk: This involves taking steps to reduce the likelihood or impact of the risk. It may include implementing preventive measures, developing contingency plans, or acquiring additional resources - Share Risk: This strategy involves transferring the risk to another party, such as through insurance, outsourcing, or partnering - Transfer Risk: This involves shifting the responsibility for managing the risk to another party, such as a subcontractor or a vendor. Control and Documentation Importance - Control: Implementing control mechanisms is essential to track risks, monitor their status, and ensure that mitigation strategies are effective. - Documentation: Thorough documentation of risk management activities provides a record of identified risks, their assessments, mitigation plans, and outcomes. This information can be valuable for future projects and organizational learning. Risk Management Report Purpose: A Risk Management Report is a tool for documenting and tracking risks throughout the project lifecycle. Key Elements: The sources suggest that a useful control document should answer the following questions3: - What?: Clearly identify the source of risk. - Who?: Assign responsibility for monitoring and managing the risk. - When?: Establish a timeframe for mitigation actions and monitoring. 24 - Why?: Analyze the underlying reasons for the risk. - How?: Develop a detailed plan for handling the risk. Additional Concepts Decision Tree Analysis - Purpose: Decision Tree Analysis is a quantitative technique for evaluating different courses of action by considering their potential outcomes, probabilities, and expected values - Applications in Risk Management: Decision trees can be used to: o Assess the risks and benefits of different risk mitigation strategies. o Make informed decisions in situations with multiple uncertainties. Example: Decision Tree for Drug Development - The sources provide an example of using a decision tree to help a pharmaceutical company decide whether to continue developing a drug or acquire a company with an already approved drug. The decision tree helps visualize the potential outcomes, their probabilities, and their associated financial impacts, allowing for a more informed decision. Learning Curves in Cost Estimation - Concept: Learning curves reflect the idea that as teams gain experience with a task, they become more efficient, leading to reduced costs and shorter durations. - Application: Learning curves can be incorporated into cost estimation models to account for potential cost reductions over time. Behavioral Issues in Budgeting - Perspective: Different stakeholders may have different perspectives on cost estimation and budgeting, which can influence the accuracy of estimates - Potential Issues: o Underestimation: Senior management might underestimate costs due to optimism or pressure to secure project approval. o Overestimation: Junior team members might overestimate costs to protect themselves from potential blame for budget overruns. o Arbitrary Adjustments: Individuals at different levels might add or remove reserves from the budget without sufficient justification. - Mitigation: Open communication, clear guidelines, and a collaborative approach to budgeting can help minimize these issues. 25 Chapter 8 Cost Management and Budgeting Importance of Cost Management Effective cost management is crucial for project success, ensuring that the project stays within budget and delivers value to the organization. Project Cost Terms and Classifications The sources emphasize the importance of understanding and classifying project costs to accurately estimate and manage project budgets. Direct Costs vs. Indirect Costs - Direct Costs: Directly attributed to specific project activities or work packages. Examples include labor, materials, and equipment Total direct labor cost = (direct labor rate)(total labor hours) - Indirect Costs: Cannot be directly assigned to specific project tasks. These costs are often shared across multiple projects or departments and include overhead expenses and general and administrative (G&A) costs. Fully loaded labor costs - The total expenses and employer incurs for an employee’s labor Hourly rate * hours needed * overhead charge * personal time = fully loaded labor cost Recurring Costs vs. Nonrecurring Costs - Recurring Costs: Costs that occur repeatedly throughout the project lifecycle, such as labor, material, and operating expenses - Nonrecurring Costs: Costs that occur only once during the project, typically at the beginning or end. Examples include project initiation costs, training expenses, and project closure activities Fixed Costs vs. Variable Costs - Fixed Costs: Costs that remain constant regardless of the project's output or activity level. Examples include rent, insurance, and salaries. The contractor has a higher risk that the client. - Variable Costs: Costs that fluctuate based on the project's output or activity level. Examples include raw materials, hourly labor, and transportation costs Normal Costs vs. Expedited Costs 26 - Normal Costs: Costs incurred under typical project conditions and timelines - Expedited Costs: Costs associated with speeding project activities, often due to schedule constraints or unforeseen delays. Expediting often involves premium payments, overtime labor, and increased resource utilization Cost Estimation Methods The sources describe four common methods for estimating project costs: - Ballpark Estimates (Rough Order of Magnitude - ROM): Preliminary estimates used in the early stages when limited information is available. These estimates typically have a wide range of accuracy (±30%) and are used for initial budget planning and feasibility assessments - Comparative Estimates (Parametric Estimation): Utilize historical data from similar projects to estimate costs for the current project. A multiplier is often applied to adjust for inflation and other cost variations. Comparative estimates generally offer better accuracy than ballpark estimates (±15%) - Feasibility Estimates: Based on more detailed information and may include preliminary quotes from vendors and subcontractors. Feasibility estimates are typically used during the project selection phase and have an accuracy range of around ±10% - Definitive Estimates: The most accurate cost estimates, developed after thorough scope definition and analysis. Definitive estimates form the basis of the project budget and are considered to have high accuracy (±5%) Steps of Cost Estimation The sources outline a three-step process for estimating project costs: 1. Identify Cost Drivers: Determine the resources required for each work package, such as labor, materials, equipment, and other expenses 2. Determine Cost Rates: Establish the cost per unit for each cost driver. This may involve obtaining quotes, analyzing historical data, or using industry benchmarks 3. Calculate Costs: Multiply the cost driver rate by the quantity of cost driver units required for the work package. This gives the direct cost for the work package. Cost estimating should occur after the WBS is created and before the budget is developed. Budget Contingencies Purpose: Contingencies are allocated funds added to the project budget to account for unexpected events, risks, and uncertainties. Necessity: Contingencies are essential because project scope, costs, and schedules can change due to unforeseen circumstances, such as market fluctuations, technical challenges, and external factors. Determination: The amount of contingency is typically determined based on the project's risk assessment, complexity, and historical data. Time-Phased Budget Definition: A time-phased budget breaks down the project budget into smaller time periods, such as months or quarters, to show the planned expenditures over time 27 Benefits: - Helps monitor budget performance by comparing planned expenditures to actual spending. - Facilitates resource allocation and scheduling by aligning costs with project timelines. - Supports project control and decision-making by providing visibility into cost trends and potential overruns. Learning Curves in Cost Estimation Concept: Learning curves recognize that as individuals or teams gain experience with a task, they become more efficient, leading to potential cost reductions Application: Cost estimation models can incorporate learning curves to account for potential cost savings as the project progresses. The assumption is that the time and cost required for a repetitive task will decrease as experience is gained. Behavioral Issues in Budgeting Managerial Perspectives: Different levels of management may have different perspectives on cost estimation, influencing budget accuracy. Potential Biases: - Senior management may underestimate costs due to optimism or pressure to secure project approval. - Junior team members might overestimate costs to avoid blame for budget overruns. Arbitrary Adjustments: Adding or removing contingency funds without justification can distort the budget Mitigation: Open communication, clear estimation guidelines, and a collaborative budgeting process can help minimize these issues. Chapter 9 Project scheduling Project Scheduling Overview Project scheduling involves creating a detailed timetable outlining the start and end dates for all project activities, their interdependencies, and the allocation of resources. The lecture emphasizes the importance of project schedules for successful project execution and risk management. A well-defined project schedule provides the following benefits: - Task Dependency Clarity: Shows the relationships between tasks and how their completion impacts subsequent activities. - Slack Time Visibility: Determines the amount of flexibility (float) available for each task and the overall project. - Critical Path Identification: Pinpoints the sequence of tasks that determine the shortest possible project duration. 28 - Resource Allocation: Facilitates the assignment of resources (people, equipment, materials) to tasks based on their scheduled start and end dates. - Progress Tracking: Enables monitoring and control of project progress by comparing actual completion dates to the planned schedule. - Risk Mitigation: Helps identify potential schedule risks and develop mitigation strategies. Network Diagrams Network diagrams visually represent the project schedule, showing the relationships between tasks. The lecture highlights the following advantages of using network diagrams: - Interdependency Visualization: Clearly illustrates how tasks are interconnected - Enhanced Communication: Provides a common visual representation for stakeholders to understand the project schedule. - Critical Activity Identification: Helps identify the tasks that are crucial for meeting project deadlines. - Schedule Visualization: Shows the planned start and finish dates for each task. - Completion Time Determination: Enables the calculation of the overall project duration. AOA vs. AON Two common methods for constructing network diagrams are: - Activity-on-Arrow (AOA): Represents tasks as arrows, with nodes indicating the start and finish points of activities. - Activity-on-Node (AON): Represents tasks as nodes (boxes), with arrows showing the dependencies between them. Network Diagram Rules The sources list several rules for creating network diagrams: 1. Clear Start and Finish: The network must have a single start node and a single finish node. 2. No Dangling Activities: All activities must be connected to the network, with no loose ends. 3. Complete Predecessors: An activity can only start after all its preceding connected activities are finished. 4. Arrows Indicate Precedence: Arrows show the logical flow of activities and their dependencies. 5. Unique Activity Identifiers: Each activity should have a unique identifier (number, letter, code). 6. No Looping: Activities cannot cycle back to themselves or create endless loops. Node Labels Nodes in a network diagram typically include the following information: 29 - Early Start (ES): The earliest possible time an activity can begin, considering its predecessors. - Early Finish (EF): The earliest possible time an activity can be completed. - Late Start (LS): The latest possible time an activity can start without delaying the project. - Late Finish (LF): The latest possible time an activity can finish without delaying the project. - Activity Float: The amount of time an activity can be delayed without affecting the project's overall duration. - Activity Descriptor: A brief description of the activity. - ID Number: A unique identifier for the activity. - Activity Duration: The estimated time required to complete the activity. Activity Relationships Serial Activities Serial activities are performed sequentially, with one activity starting only after the preceding one is finished. Concurrent Activities Concurrent activities can be performed simultaneously, assuming resources are available. This can shorten the overall project duration. Burst and Merge Activities - Burst Activity: An activity that has multiple successor activities that can start concurrently. - Merge Activity: An activity that has multiple predecessor activities, and it can only begin after all its predecessors are completed. 30 Activity Duration Estimation 1. Deterministic Estimation Assumes a fixed and known duration for each activity. This method is simple but might not reflect the uncertainties inherent in many projects. 2. Probabilistic Estimation Recognizes that activity durations are often uncertain and estimates them based on a range of possible outcomes: - Optimistic Time (a): The shortest possible duration if everything goes perfectly. - Most Likely Time (m): The most realistic estimate of the activity's duration. - Pessimistic Time (b): The longest possible duration, considering potential delays and challenges. PERT The Program Evaluation and Review Technique (PERT) is used for probabilistic time estimates, using the three-point estimation method (optimistic, most likely, and pessimistic). It calculates the expected duration and variance for each activity based on the beta distribution. PERT Formulas: - Mean (Expected Duration): TE = (a + 4m + b) / 6 - Variance of duration: s2 = ((b - a) / 6))^2 Critical Path Method (CPM) CPM is a technique for determining the critical path, the sequence of activities with zero float, which determines the shortest possible project duration. Any delay in a critical path activity will directly delay the entire project. Forward Pass (additive move): Calculates the early start ES and early finish EF times for each activity, working from the start to the finish node. ES + Duration = EF EF of one activity becomes the ES of the next activity, unless the succeeding activity is a merge point. At a merge point, the largest preceding EF becomes the ES for that activity. 31 Backward Pass (subtractive mode): Calculates the late start LS and late finish LF times for each activity, working from the finish to the start node. LF – Duration = LS Carry back the LS time to the activity nodes immediately preceding the successor node. That LS becomes the LF of the next node, unless the preceding node is a burst point. Smallest succeeding LS at a burst point becomes LF for the predecessor. Float Calculation Float (Slack)= the amount of time an activity can be delayed and still not slow the overall project Activity float (slack) can be calculated using either of these formulas: - Float = LF – EF - Float = LS - ES Critical Path Identification The critical path is the path with zero float for all its activities. Laddering Activities Laddering allows for overlapping activities by breaking down larger tasks into smaller segments that can be started while preceding segments are still in progress. This technique can potentially reduce the overall project duration. Probability of Project Completion The probability of completing the project by a specific date can be estimated using statistical methods, considering the project's variance and standard deviation. 32 Chapter 10 Project scheduling – lagging, crashing and activity networks This lecture expands on project scheduling concepts from Lecture 9, focusing on lagging, crashing, and activity networks. It uses the B&B Furniture company case study introduced in Lecture 9 to illustrate the concepts. Lagging in Project Schedules Lagging introduces a delay between the start or finish of one activity and the start of its successor. The sources explain lagging primarily through a Finish-to-Start relationship, where the successor activity cannot begin until a specified time after the predecessor activity finishes. Reasons for Lagging - Resource Availability: Waiting for a specific resource to become available before starting the successor activity1. - Process Requirements: Allowing time for materials to cure, information to be processed, or approvals to be obtained1. - External Factors: Delays caused by factors outside the project team's control, such as weather or regulatory approvals. Lead in Project Schedules Lead is the opposite of lag. It allows the successor activity to start before the predecessor activity is finished. Examples of Lead: - Construction Projects: Starting the painting of lower floors while electrical work continues on upper floors - Creative Projects: Beginning the editing of a photo shoot after the first day of shooting while the shoot continues for two more days. Reasons for Lead: - Task Overlap for Efficiency: Overlapping tasks to reduce the overall project duration - Early Start for Long Lead Items: Allowing for long lead times for materials or equipment procurement - Resource Optimization: Balancing resource utilization by starting successor activities with available resources while predecessors are still in progress2. Impact of Lags on the B&B Furniture Project The sources modify the B&B Furniture case study by introducing lags between certain activities in the project network. The lags are: - 15 days between activities C (Manufacture of prototype model) and G (Staff input on prototype models) 33 - 5 days between activities D (Revision of design) and E (Initial production run) - 5 days between activities A (Prototype model design) and F (Staff training). These lags change the critical path of the project and affect the overall project duration. Impact of Delays on the Modified B&B Furniture Project Crashing in Project Schedules Crashing involves accelerating activities on the critical path to shorten the overall project duration. It typically comes with increased costs due to the need for additional resources or expedited work. Deciding About Crashing Crashing decisions aim to find the optimal trade-off between reducing project duration and increasing costs. The cost per unit of time of crashing is a key metric for evaluating crash options. Example: Crashing a Project The sources provide an example with eight activities to illustrate the process of identifying optimal candidates for crashing89. The example includes the normal and crashed durations and costs for each activity and analyzes the impact of crashing different activities on the project cost and duration. Example 2: Crashing Analysis Another example is provided, focusing on the decision of whether or not to crash a project. The example involves: - Analyzing normal and crashed durations and costs. - Identifying the best candidates for crashing based on the critical path and crashing costs per day. 34 - Determining the expected project duration after crashing specific activities. - Calculating the total crashing costs and the project cost after crashing. Gantt Charts Gantt charts are tool for visually representing project schedules. They provide a timeline view of activities, their durations, and their dependencies. Fast-tracking - Overlap Activities: Tasks that depend on each other are started earlier, even before the predecessor task is fully completed. - No Additional Resources: Unlike crashing, fast-tracking doesn’t require adding extra resources or costs upfront (although risks might increase). - Increased Risk: Since tasks are performed simultaneously, the likelihood of errors, rework, or miscommunication increases. AOA network Chapter 11 Agile and Critical Chain Project Management This lecture introduces two alternative approaches to project scheduling and management: Agile Project Management and the Critical Chain Method. Agile Project Management Agile Project Management is an iterative approach that breaks down projects into smaller cycles called sprints. It emphasizes flexibility, collaboration, and customer feedback throughout the project lifecycle. Traditional vs. Agile PM The sources contrast traditional project management with Agile methods: Feature Traditional PM Agile Methods Planning Upfront, detailed planning for Iterative planning, adapting to changes the entire project and feedback in each sprint Requirements Defined and documented in Evolving requirements, captured in detail at the beginning user stories, prioritized in a product backlog 35 Execution Linear, sequential execution Iterative execution in sprints, of tasks delivering incremental value Communication Formal, documented Frequent, face-to-face communication communication channels and collaboration Customer Limited customer Continuous customer feedback and Involvement involvement until project involvement throughout the project delivery lifecycle Change Changes are managed through Changes are welcomed and Management formal change control incorporated through sprint planning processes and backlog adjustments Agile PM in Action: Scrum Scrum is a popular framework for implementing Agile project management. - Key Scrum Terms: o Sprint: A time-boxed iteration of the Agile development cycle, typically lasting 1-4 weeks. o Time Box: The fixed duration of a sprint. o User Stories: Short descriptions of user requirements written in plain language, capturing what users need from the project. o Product Backlog: A prioritized list of user stories and features for the entire project. o Sprint Backlog: A subset of the product backlog, containing the user stories to be completed in a specific sprint. - Scrum Process o The sources provide a visual representation of the Scrum process, outlining the key events and steps: 1. Sprint Planning: The team selects user stories from the product backlog for the upcoming sprint, creating the sprint backlog. 2. Daily Scrum: A brief daily meeting for the development team to synchronize activities and plan for the next 24 hours. 3. Development Work: The actual work of designing, building, and testing the product increment during the sprint. 4. Sprint Review: At the end of the sprint, the team demonstrates the completed increment to stakeholders, gathering feedback and adjusting the product backlog if necessary. 5. Sprint Retrospective: The team reflects on the sprint, identifying what went well, what could be improved, and making adjustments to the Scrum process for future sprints. Critical Chain Method The Critical Chain Method addresses the common phenomenon of projects running late despite the inclusion of time buffers. Reasons for Project Delays 36 The sources highlight several factors contributing to project delays: - Lack of Incentive to Finish Early: Team members might not have strong incentives to complete tasks ahead of schedule. - Parkinson's Law: Work expands to fill the available time. - Student Syndrome: Procrastination and delaying work until the last possible moment. - Improper Buffer Assignment: Time buffers (reserves) might be wasted or allocated ineffectively. Addressing Delays The Critical Chain Method proposes the following strategies to mitigate delays: - Eliminating Safety Time in Individual Tasks: Encouraging team members to estimate task durations realistically without padding. - Creating a Project Buffer: Consolidating time buffers into a single project buffer at the end of the critical chain. - Feeding Buffers: Adding buffers at points where non-critical paths merge with the critical chain, protecting the critical chain from delays on non-critical paths. - Resource Leveling: Balancing resource allocation to prevent resource conflicts and delays. Critical Chain Key Concepts - Focus on the Critical Chain: The critical chain is the longest sequence of dependent tasks, considering both task durations and resource dependencies - Buffer Management: Using buffers to protect the critical chain from delays and absorb uncertainties. - Eliminate Multitasking: Encouraging team members to focus on one task at a time to improve efficiency and reduce context switching. - Early Task Completion: Incentivizing early task completion and reducing the Student Syndrome effect. Chapter 12 Resource management This lecture focuses on managing resources in projects, covering resource constraints, resource loading, resource leveling, and techniques for resolving resource conflicts. Resource Constraints in Projects The sources emphasize that project schedules are often affected by resource constraints. Resource constraints refer to limitations in the availability of resources, such as personnel, equipment, materials, and budget. Ignoring these constraints can lead to unrealistic schedules and project failures. Any attempt to create a reasonable project schedule must consider the availability of required resources. Resource Loading Resource loading is the process of determining the amount of individual resources needed for specific time periods based on the project schedule. It provides insights into: 37 - Resource Demand: The amount of each resource required at different points in the project lifecycle. - Overallocation: Situations where the demand for a resource exceeds its availability. - Resource Usage Patterns: Fluctuations in resource demand over time. Resource Leveling (Smoothing) Resource leveling, also known as resource smoothing, is a technique for resolving resource overallocation and scheduling conflicts. It aims to: - Ensure Resource Availability: Making sure that sufficient resources are available when needed. - Optimize Resource Utilization: Minimizing fluctuations in resource usage and balancing workloads. - Prevent Delays: Avoiding delays caused by resource shortages or conflicts. Resource Leveling Techniques The sources present several techniques for resource leveling, which primarily involve adjusting activity start and finish times within their available slack: 1. Delaying Non-Critical Activities: Shifting non-critical activities to later periods when resource availability is higher 2. Splitting Activities: Interrupting an activity and resuming it later to free up resources for other activities. 3. Prioritizing Activities: Allocating resources to higher-priority activities first. 4. Using Alternative Resources: Exploring the use of substitute resources if available and feasible. Steps in Resource Leveling The sources outline a general procedure for resource leveling: 1. Create the Project Activity Network Diagram: Develop a network diagram showing the relationships between activities. 2. Determine Activity Slacks and Late Finish Dates: Calculate the amount of slack (float) for each activity and their late finish dates. 3. Develop the Resource Loading Table: Create a table showing the resource requirements for each activity and time period. 4. Identify Resource Overallocation: Determine periods where resource demand exceeds availability. 5. Level the Resource Loading Table: Apply resource leveling techniques to resolve overallocation, considering slack, priorities, and other factors. Rules of Thumb for Resource Allocation The sources provide heuristics for prioritizing resource allocation when conflicts arise: 1. Smallest Amount of Slack: Give priority to activities with the least slack to minimize schedule slippage 2. Smallest Duration: Allocate resources to shorter-duration activities first. 3. Lowest Activity ID: Prioritize activities that start earlier in the WBS. 38 4. Most Successor Tasks: Focus on activities with the most subsequent tasks dependent on them. 5. Most Resources Required: Allocate resources to activities with the highest resource demands. 6. Minimize Task Splitting: When possible, prioritize allocating resources to activities that do not require splitting. Example: Resource Leveling The sources illustrate resource leveling concepts through a detailed example involving a project with multiple activities and resource constraints. The example demonstrates the steps of creating a resource loading table, identifying overallocation, and applying resource leveling techniques to create a smoother resource profile. Splitting Activities The sources highlight splitting activities as a technique for resolving resource conflicts. Splitting involves interrupting work on an activity and resuming it later to allow resources to be used for other activities during the interruption period. This technique can be effective in balancing resource usage and smoothing out resource demand peaks. However, it's essential to consider the potential downsides of splitting activities, such as: - Increased Overhead: The need to restart and coordinate the split activity might lead to increased overhead. - Loss of Focus: Interrupting work on an activity can disrupt the team's focus and momentum. - Potential for Errors: Restarting an activity might introduce errors or require rework. Chapter 13 & 14 Project Evaluation & Control, Termination & Closeout These lectures discuss methods to monitor and control project progress, techniques for project termination, and essential elements of the project closeout process. Lecture 13: Project Evaluation and Control Project control is the process of comparing actual performance to planned performance and taking corrective action to address deviations. Effective monitoring and control systems are crucial for project success, especially given the time and budget constraints inherent i n most projects. Monitoring Project Performance One common method for monitoring project status is comparing actual spending to the original budget projections, both at the individual task level and the overall project level. Project S-Curve The project S-curve is a graphical representation of cumulative project spending over time. It allows for a quick visual comparison between planned and actual spending, highlighting potential problem areas where deviations exist. 39 Benefits of the S-Curve: - Simplicity: Easy to understand and visualize project progress. - Early Warning: Deviations from the planned curve signal potential issues early on. Drawbacks of the S-Curve: - Lack of Causal Explanation: While it shows variance, it doesn't explain why the variance occurred. - Reactive Nature: Data reflects expenditures that have already occurred.5 Milestone Analysis Milestones are significant events or stages in a project that represent a notable accomplishment. They can be tied to deliverables, critical path activities, or calendar dates. Benefits of Milestones: - Clear Signals: Provide clear indicators of progress for the team and stakeholders - Motivation: Achieving milestones can boost team morale. - Reevaluation Points: Offer opportunities to reassess progress and adjust plans if necessary. - Coordination: Help synchronize schedules with stakeholders and suppliers. Problems with Milestones: - Oversimplification: May not capture the complexity of underlying tasks and potential issues. - Lack of Detail: May not provide sufficient insight into the root causes of delays or problems. Tracking Gantt Charts Tracking Gantt charts are visual representations of project schedules that show the planned and actual progress of tasks. They provide a clear overview of which tasks are ahead, on, or behind schedule. Benefits of Tracking Gantt Charts: - Visual Clarity: Easy to understand and interpret. - Real-time Updates: Allow for quick updates and monitoring of progress. Drawbacks of Tracking Gantt Charts: - Limited Insight: Don't always reveal the root causes of task slippage. - Lack of Future Projections: Don't provide reliable projections for the project's estimated completion time. Earned Value Management (EVM) EVM is a project management technique that integrates cost, schedule, and work performance data to assess project status and make future projections. Unlike other methods that focus solely on cost or schedule, EVM provides a more comprehensive picture of project health. EVM Key Performance Metrics - Planned Value (PV): The budgeted cost of work scheduled to be performed up to a specific point in time. - Earned Value (EV): The budgeted cost of work actually performed up to a specific point in time. 40 - Actual Cost (AC): The actual cost incurred for work performed up to a specific point in time. EVM Terminology - Schedule Variance (SV): A measure of schedule performance (EV - PV). A positive SV indicates the project is ahead of schedule, while a negative SV means it's behind schedule. - Cost Variance (CV): A measure of cost performance (EV - AC). A positive CV indicates the project is under budget, while a negative CV means it's over budget. - Schedule Performance Index (SPI): A ratio of earned value to planned value (EV/PV), indicating schedule efficiency. An SPI greater than 1 suggests the project is progressing faster than planned, while an SPI less than 1 implies it's progressing slower. - Cost Performance Index (CPI): A ratio of earned value to actual cost (EV/AC), indicating cost efficiency. A CPI greater than 1 suggests the project is performing under budget, while a CPI less than 1 implies it's performing over budget. - Estimate at Completion (EAC): The projected total cost of completing the project, based on current performance (BAC/CPI). - Estimate to Completion (ETC): The estimated cost required to complete the remaining work. - Budgeted cost at completion (BAC): The total budget for a project If EV = AC then it means that there is no cost variance. Steps in EVM 1. Clearly define each activity, including resource needs and budget. 2. Create usage schedules for activities and resources. 3. Develop a time-phased budget (PV). 4. Total the actual costs of doing each task (AC). 5. Calculate budget variance (CV) and schedule variance (SV). 6. Calculate SPI and CPI. 7. Calculate EAC and ETC. Lecture 14: Termination & Closeout Project termination involves all activities associated with closing out the project, including administrative tasks, documentation, and knowledge transfer. Types of Project Termination - Termination by Extinction: The project is stopped due to successful or unsuccessful completion. - Termination by Addition: The project is absorbed into a larger organizational entity. - Termination by Integration: The project's outputs are integrated into ongoing operations. 41 - Termination by Starvation: The project loses resources or support and is gradually phased out. Elements of Project Closeout Management (Natural Termination) - Putting it All to Bed: Finalizing all project activities and documentation. - Disbanding the Team: Releasing project team members and reassigning them to other projects or roles. - Finishing the Handing Over the Work Product: Completing deliverables and ensuring their acceptance by the client or stakeholders. - Gaining Acceptance for the Product: Obtaining formal sign-off and approval of deliverables. - Harvesting the Benefits: Realizing the intended benefits and value from the project. - Reviewing How it All Went: Conducting a post-project review and documenting lessons learned. Lessons Learned Analysis A lessons learned analysis is a systematic review of project experiences to identify successes, failures, and areas for improvement. This knowledge is captured and shared to benefit future projects. Common Errors in Lessons Learned Analysis: - Misidentifying Systematic Errors: Attributing problems to individual mistakes when they are rooted in organizational processes or systems. - Misinterpreting Lessons Based on Events: Drawing inaccurate conclusions from isolated incidents. - Failure to Pass Along Conclusions: Not effectively sharing lessons learned with relevant stakeholders. Guidelines for Lessons Learned Meetings: - Establish Clear Rules of Behavior: Ensure respectful and constructive discussions. - Describe Objectively What Occurred: Focus on facts rather than opinions or blame. - Fix the Problem, Not the Blame: Emphasize solutions and improvements rather than assigning fault. Putting it All to Bed: Closeout Paperwork Thorough documentation is essential during project closeout to ensure a smooth transition, track agreements, and provide a historical record. Key Areas of Closeout Documentation: - Documentation: Archiving project plans, reports, and deliverables. - Legal: Finalizing contracts and resolving any outstanding legal issues. - Cost: Closing out financial accounts and settling payments. - Personnel: Managing personnel transitions and addressing HR matters. Why are Closeouts Difficult? - De-motivation: Team members may be less motivated as the project nears completion. - Shortcuts: Time and budget constraints may lead to rushed or incomplete closeout activities 42 - Low Priority: Closeout tasks are often perceived as less important than project execution. - Administrative Burden: Closeout paperwork can be extensive and time-consuming. 43

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