Ch1 Project Management PDF

Ch1 4 Project management is increasingly vital: - Growing demand: Project-oriented industries are projected to add $34.5 trillion to global GDP and 25 million new PM roles by 2030. - 2020 showed projects' importance, with agile organizations adapting better to change. - Financial impact: Poor pr...

Ch1 4 Project management is increasingly vital: - Growing demand: Project-oriented industries are projected to add $34.5 trillion to global GDP and 25 million new PM roles by 2030. - 2020 showed projects' importance, with agile organizations adapting better to change. - Financial impact: Poor project performance wastes 11.4% of investment, emphasizing the value of good PM. 5 More Motivation to Study PM - Project management salaries are rising, with an average compensation of $124,000 in the U.S. in 2019. - PMP® certification boosts earning potential, with certified professionals earning 22% more on average. - PM skills are crucial for personal success as well. 6 What Went Wrong? - The 1995 Standish Group study (CHAOS Report) found only 16.2% of IT development projects met scope, time, and cost goals, with 31% canceled before completion, costing over $81 billion in the U.S. - A 2019 study by KPMG, AIPM, and IPMA showed only 19% of organizations consistently delivered projects successfully, meeting scope, time, cost, and stakeholder satisfaction goals. 7 Advantages of Using Formal Project Management - Better control of financial, physical, and human resources - Improved customer relations - Shorter development times - Lower costs - Higher quality and reliability - Higher profit margins - Improved productivity - Better internal coordination - Higher worker morale 8 What Is a Project? - A project is a temporary endeavor to create a unique product, service, or result. - Operations involve work to sustain the business. - Projects end when their objectives are achieved or the project is terminated. 9 Examples of Projects - A couple hires a firm to design and build a new house. - A retail manager collaborates with employees to showcase a new clothing line in-store and online. - A school district upgrades technology for wireless Internet access for all students at school and home. - A medical tech firm creates a device that connects to smartphones. - A pharmaceutical company launches a new drug or vaccine. - A TV network creates a system for viewers to vote and give feedback via multiple devices. 10 Video Highlights The Project Management Institute (PMI) awards outstanding project performance with the Project of the Year Award: - 2020: Trans Anatolian Natural Gas Pipeline (TANAP) Project - 2019: Embraer E190-E2 Program Development - 2018: Project Legacy – Southeast Louisiana Veterans Health Care System Replacement 11 History of PM Video - *History of Project Management* (music only) - 5:26 - *Author’s Perspective* by Mark Kozak-Holland - 5:05 - Links to all video highlights are available on the companion website under 7e Resources. 12 Project Attributes - A project: - Has a unique purpose - Is temporary - Drives change and creates value - Develops progressively or iteratively - Requires resources from various areas - Has a primary customer or sponsor (who provides direction and funding) - Involves uncertainty - Project managers collaborate with sponsors, teams, and stakeholders to define, communicate, and achieve project goals. 13 Project Constraints - Every project faces constraints; many project managers focus on the *triple constraint*: - **Scope**: Defines the work and expected outcomes of the project. - **Time**: Establishes the project duration and timeline. - **Cost**: Sets the budget and required resources. - Additional constraints include quality, risk, and resources. 15 What is Project Management? - Project management is the application of knowledge, skills, tools, and techniques to project activities to meet project requirements. 17 Project Stakeholders - Stakeholders are individuals involved in or impacted by project activities, including: - Project sponsor - Project manager - Project team - Support staff - Customers - Suppliers - Opponents to the project 18 Project Management Knowledge Areas - Project integration management: Coordinates work across all knowledge areas and interacts with each. - Project scope management: Involves defining, agreeing on, and managing all work required for project completion with stakeholder input. - Project time management: Entails estimating task durations, creating a resource-effective schedule, and ensuring timely project completion. - Project cost management: Involves preparing and managing the project budget. - Project quality management: Ensures the project meets the intended needs and requirements. 19 Project Management Knowledge Areas (continued) - Project resource management: Focuses on effective use of people and physical resources for the project. - Project communications management: Involves generating, collecting, disseminating, and storing project information. - Project risk management: Includes identifying, analyzing, and responding to project-related risks. - Project procurement management: Involves acquiring goods and services for the project from external sources. - Project stakeholder management: Focuses on identifying stakeholders, understanding their needs, and engaging them appropriately throughout the project. 20 Project Management Tools and Techniques - Project management tools and techniques help project managers and teams in various aspects. - Tools and techniques are not limited to software. Specific examples include: - Project charters, scope statements, WBS (for scope) - Gantt charts, network diagrams, critical path analyses (for time) - Net present value, cost estimates, earned value management (for cost) - Agile projects use product roadmaps, backlogs, burndown charts, retrospectives, etc. 21 Project Success - Project success can be defined in various ways: - The project provided value (worth, importance, or usefulness). - The project met scope, time, and cost goals. - The project satisfied the customer or sponsor (often measured by net promoter score, indicating customer’s willingness to recommend). - The project produced the desired results. 22 What Went Right? Improved Project Performance - Follow-up studies by the Standish Group indicate improvement in IT project success: - Successful projects rose from 16% in 1994 to 29% in 2015. - Failed projects dropped from 31% in 1994 to 19% in 2015. - From 2011-2015, 62% of small projects succeeded, compared to 2% grand, 6% large, 9% medium, and 21% moderate-sized projects. - 39% of agile projects succeeded, versus 11% of waterfall projects. - In 2021, 31% of software projects were successful, with 46% of these delivering high value to the organization. 24 New Terminology in Seventh Edition Framework - Principles for a profession provide foundational guidelines for strategy, decision-making, and problem- solving. - A project performance domain is a set of related activities essential for effective project outcome delivery. - Tailoring is the intentional adaptation of project management approaches, governance, and processes to fit the specific environment and work requirements. 25 Models, Methods, and Artifacts - A model is a thinking strategy to explain a process, framework, or phenomenon (e.g., leadership models, change models). - A method is a means to achieve an outcome, result, or deliverable (e.g., estimation tools, meeting techniques). - An artifact can be a template, document, output, or project deliverable (e.g., project charter, product backlog, contract). 26 Programs and Mega projects - A program is a group of related projects, subsidiary programs, and activities managed together to achieve unattainable benefits if managed separately. - A megaproject is a large project costing over $1 billion, impacting over a million people, and lasting several years. 27 Media Snapshot - Panama Canal Expansion Project, Panama: 11 years, $5.25 billion. Expanded the 1914 canal for larger ships. - Port Mann Bridge, Vancouver, Canada: 6 years, $1.92 billion. North America’s second largest bridge, spanning 6,866 feet. - Three Gorges Dam, China: 17 years, $22 billion. Located on the Yangtze River, it stands 595 feet tall, 131 feet wide, over 7,600 feet long, and has 32 main turbines for electricity generation. 29 Project Portfolio Management - A portfolio comprises projects, programs, subsidiary portfolios, and operations managed collectively to achieve strategic objectives. - Organizations increasingly adopt project portfolio management, continuously selecting and managing the best projects and programs for maximum business value. - The key difference between project or program management and portfolio management lies in the focus: project/program management targets tactical goals, while portfolio management aims at strategic goals. 30 Project and Program Management Compared to Project Portfolio Management - Project and program management focus on: - Are we executing projects effectively? - Are projects on time and within budget? - Do stakeholders understand their roles? - Portfolio management focuses on: - Are we working on the right projects? - Are we investing in the right areas? - Do we have the resources needed to stay competitive? 31 What Is Agile? - Agile has various definitions: - Agile Alliance (2021): "The ability to create and respond to change." - Merriam-Webster (2021): "Marked by a ready ability to move with quick, easy grace." - PMI’s Agile Practice Guide (2017): "A mindset of values and principles as outlined in the Agile Manifesto." - Agile may not suit all projects due to complexity and varied frameworks; by 2021, there were over 80 agile frameworks. - Scrum, the most popular, is a lightweight framework for teams and organizations to create adaptive solutions for complex problems. 33 Manifesto for Agile Software Development and Principles behind the Agile Manifesto - Manifesto for Agile Software Development values: - Individuals and interactions over processes and tools - Working software over comprehensive documentation - Customer collaboration over contract negotiation - Responding to change over following a plan While there is value in the items on the right, the items on the left are prioritized. (The term "software" can be replaced with "products" or "solutions.") 34 Manifesto for Agile Software Development and Principles behind the Agile Manifesto Principles behind the Agile Manifesto: 1. Prioritize customer satisfaction through early and continuous delivery of valuable software. 2. Embrace changing requirements, even late in development, to enhance customer competitiveness. 3. Deliver working software frequently, preferring shorter timescales. 4. Ensure daily collaboration between business people and developers. 5. Build projects around motivated individuals, providing them with support and trust. 6. Use face-to-face conversation as the most effective way to convey information within the team. 7. Measure progress primarily through working software. 8. Promote sustainable development with a constant, maintainable pace. 9. Focus on technical excellence and good design to enhance agility. 10. Maximize simplicity by reducing unnecessary work. 11. Allow self-organizing teams to produce the best architectures, requirements, and designs. 12. Reflect regularly to improve team effectiveness and adjust behaviors as needed. 35 What Is an Agile Mindset? - Gil Broza, in *The Agile Mind-Set* (2015), highlights the importance of focusing on values, beliefs, and principles before adopting specific frameworks or processes. - Organizations with an agile mindset, unlike bureaucratic ones, operate as a network of teams dedicated to delivering customer value. - Work is most effectively done by small, self-organizing teams working in short cycles to deliver valuable outcomes to customers. 36 What Is the Difference Between Predictive, Agile, and Hybrid Project Management? - Agile project management (adaptive) is for projects with an undefined scope, requiring incremental releases and expecting changes. - Predictive project management (waterfall/traditional) involves upfront planning, delivering a single final product, constraining change, controlling costs and risks, and engaging stakeholders at set milestones. - Hybrid project management combines elements of both agile and predictive approaches. 37 Study Finds Most Projects are Hybrid - A 2021 study of 477 projects across industries found that 52% used a hybrid project management approach. - The project management approach was not linked to performance on scope, time, cost, and quality goals. - Agile and hybrid approaches significantly outperformed predictive approaches in stakeholder success, including sponsor, client, and team satisfaction. - Hybrid approaches were found to be as effective as fully agile methods, supporting the trend of combining agile and traditional practices as a leading approach. 38 The Project Management Profession - Project, program, and portfolio managers require specialized skills. - Certification options are available for project managers. - Numerous software tools exist to support project, program, and portfolio management. 39 Suggested Skills for Project Managers - Knowledge required includes: - All ten project management knowledge areas, eight performance domains, tools, and techniques - Application area (specific domain, industry, or market) - Project environment (politics, culture, change management) - General business skills (financial management, strategic planning) - Human relations skills (leadership, motivation, communication) 40 PMI Talent Triangle 1. Technical project management skills: Involves understanding knowledge areas, process groups, and project management tools and techniques. 2. Strategic and business management skills: Includes strategic planning, financial management, accounting, marketing, and related topics. 3. Leadership skills: Involves providing vision and inspiration, focusing on long-term goals and big-picture objectives. While leaders inspire toward goals, managers handle day-to-day goal achievement—project managers often fulfill both roles. 41 Additional Skills for Program and Portfolio Managers - Program managers typically have project management experience and rely on their background, business knowledge, leadership, and communication skills to manage programs. - Portfolio managers need strong financial and analytical skills and must understand how projects and programs align with strategic goals. 42 Best Practice - A best practice is an optimal method recognized by industry to achieve a specific goal. - Robert Butrick emphasizes basic project management principles: - Ensure projects align with business strategy and promptly eliminate projects that do not fit. - Engage stakeholders at all stages, encouraging teamwork and commitment. Use leadership and open communication to drive project success. 43 Project Management Certification - PMI offers Project Management Professional (PMP) certification. - A PMP has documented project experience, adheres to a code of ethics, and has passed the PMP exam. - The number of PMP-certified professionals is rapidly increasing. 45 Other Certifications - Chapter 10 provides more details on PMP and other certifications. - PMI offers multiple certifications. - In 2021, Google launched a project management certification under its "Grow with Google" program. - PRINCE2 is a globally recognized, process-based project management method with over 1 million certified professionals. - Scrum.org reported over 557,000 professional scrum certifications worldwide as of 2021. - The International Project Management Association (IPMA) offers various certification levels based on project management experience, with over 320,000 certified professionals in 2021. - CompTIA’s Project+ certification targets business professionals managing small- to medium-sized projects. 46 PMI Student Membership and Certification Information - Students can join PMI at a reduced fee ($32 instead of $139 in 2021). - Consider obtaining the Certified Associate in Project Management (CAPM) credential from PMI. - A bachelor’s degree qualifies you for the CAPM without work experience. - The PMP is more marketable if you have sufficient work experience. 47 Ethics in Project Management - Ethics, defined as principles guiding decision-making based on personal values of "right" and "wrong," are crucial in all professions. - Project managers frequently encounter ethical dilemmas. - PMI's Code of Ethics and Professional Conduct applies to all PMI members, certification holders, certification applicants, and PMI volunteers. 48 Project Management Careers - By 2027, employers will require 87.7 million people in project management-oriented roles. - In June 2020, LinkedIn ranked project management as the third top job for openings, growth, and livable wages. - Sixty percent of hiring managers report increased interest in project management careers among younger applicants over the past decade. 49 Project Management Career Path - Many start by leading small, part-time projects related to their current job to assess their fit and interest in project management. - Some organizations require a few years of experience before allowing employees to lead projects, while others hire entry-level project coordinators or managers. - Many organizations provide a structured career path to develop and maintain a project management talent pipeline, with different levels based on knowledge and experience.  50 Project Management Software - There are hundreds of project management products available. - A 2020 report estimates the global project portfolio management (PPM) market will reach $11.4 billion by 2027, with a 13.4% compound annual growth rate from 2020 to 2027. - Project-intensive organizations across various industries use PPM solutions to automate operations and manage project lifecycles effectively. - PPM solutions provide a big-picture view, ensuring best practices, principles, and standards are applied, driving market growth. 51 Software for Agile Project Management - Demand for agile project management software has grown. - 95% of respondents indicated their organizations use some agile development methods, though only about half have mostly agile teams. - A wide range of software tools is in use for agile projects. 57 Free Trials and Information on Using Microsoft Project, Jira, Asana, MindView, Basecamp, and Other Software - A 30-day evaluation copy is available for tools like Microsoft Project and MindView on their company websites. - Tools such as Jira, Asana, and Basecamp offer trial versions with unlimited timeframes. - Appendix A and the book’s companion website (http://intropm.com/) provide more information and links on project management software. 58 Chapter Summary - A project is a temporary effort aimed at creating a unique product, service, or result. - Project management involves applying knowledge, skills, tools, and techniques to meet project requirements. - Many organizations now prefer agile/adaptive or hybrid approaches over predictive/waterfall methods, with an agile mindset crucial for agile project success. Agile/adaptive management is suitable when scope is undefined, incremental releases are needed, and changes are expected. - A program is a coordinated group of related projects and activities designed to achieve benefits unattainable individually. - Project portfolio management organizes projects and programs as investments contributing to the overall success of the enterprise. - The project management profession is growing, with high demand for skilled project managers.