Project Management Basics PDF

Document Details

AdorableBerkelium6305

Uploaded by AdorableBerkelium6305

Technische Universiteit Delft

Tags

project management project portfolio management project selection project management basics

Summary

This document provides an overview of project management, including project basics, project life cycle, and project success criteria. It also explores aspects of project portfolio management and project selection.

Full Transcript

lOMoARcPSD|11547315 Project management basics Basisaspecten projectmanagement (Technische Universiteit Delft) Scannen om te openen op Studeersnel Studeersnel wordt niet gesponsord of ondersteund door een hogeschool of universiteit...

lOMoARcPSD|11547315 Project management basics Basisaspecten projectmanagement (Technische Universiteit Delft) Scannen om te openen op Studeersnel Studeersnel wordt niet gesponsord of ondersteund door een hogeschool of universiteit Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Basisaspecten projectmanagement Chapter 1 – Introduction Examples for “why project management?” are Better control, better customer relations, probably an increase On Investment. (ROI), shorter development time, lower costs, higher quality and reliability, more result driven and a higher worker morale. What is a project? “A project is an endeavor in which human, financial and material resources are organized in a novel way to undertake a unique scope of work, of given specification, within constraints of cost and time, so as to achieve beneficial change defined by quantitative and qualitative objectives.” Three key characteristics o Unique No routines Uncertainty Only long-term feedback o Temporary It has a beginning and an end Requires a group of people o Focused Delivers a product, service or result Boundaries PM standard – PMBoK The Project Management Body of Knowledge (PM-BOK) is: o Delivered by the Project Management Institute The preeminent global standard for project management PM standards – PRINCE2 Projects IN Controlled Environments o Contuned business justification o Manage by exception o Learn from experience o Focus on products o Denied roles and responsibilities o Tailor to suit the project environment o Manage by stages Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 The project life cycle Initiation o Develop proposals Execution o Gather information o Detailed design o Conduct feasibility o Baseline estimates o Estimate design o Costs: 95 - ??% o Cost: 0.2% Design o Develop design o Estimate costs and returns o Assess viability o Obtain funding o Further develop the plan o Cost: 1% - ??% Relation between influence and cost during the lifetime of a project. Project success (&failure) Success criteria for management success o Achieves stated business purpose o Results are to specification, budget and time o Provides satisfactory benefit to owner o Satisfies needs of project team and supporters o Satisfies need of owner, users, stakeholders o Makes a profit o Meets pre-stated objectives Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Success is multi-dimensional 1. Project efficiency 2. Impact on customer 3. Business success 4. Preparing the future Project success, assess success based on 6 criteria: safety, within budget, within time, quality, client satisfaction and ease of start-up Profiles for project success 1. Foundation 2. Planning 3. Organizing and implementing 4. Controlling Learning from projects Complexity often is mentioned as a cause for project failure. A lesson learned is a knowledge or understanding gained by experience. Stakeholders Those who can influence or are influenced by the project; those who have a “stake” in a project. Internal or external to the organization. Position based on influence (power), interest & support (attitude) Chapter 2 – Project portfolio management and project selection Project portfolio management A program à a group of related projects managed in a coordinated way to obtain benefits and control not available from managing them individually A portfolio à a collection of projects and/or programs and other work that are grouped together to facilitate the effective management of that work to meet strategic business objectives Program management à the management of multiple projects, all contributing to fulfilling higher level strategic goals Main characteristics of project portfolio o Portfolio includes all projects executed by a company o Portfolio management aims at achieving strategic business objectives o Portfolio is an effectively managed collection of projects o Components of portfolio are quantifiable Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Portfolio management is about making decisions about allocation of resources or choosing between different alternatives. Project selection Crucial aspects of portfolio management 1. Strategic fit a. Important way to implement the corporate strategy b. Projects should be in line with the corporate strategy c. A lack of strategic fit negatively influences project success 2. Value add a. Description of the project, reasons for project, benefits, costs/ negative benefits. Risks and recommendation 3. Portfolio risks a. Related to the uncertainties around the strategic developments of an organization such as market conditions, the political situation and the labour market. The risks are outside the control of the organization. Project risks à Risks are related to uncertainties in the projects of a portfolio. The organization can take charge in these risks. Portfolio selection methods o Ad hoc approaches Bubble = annual resources o Operational necessity o Comparative approaches o Scoring models o Portfolio matrices and bubble diagram o Mathematical models like optimization The Boston Consultancy Group 2x2 Matrix for evaluating portfolios. (example portfolio selection methods) Drivers for the portfolio management process 1. Business strategy 2. The (project) Stage Gate process 3. The portfolio review (typically bi-annually) Various types of project funnels o Generate more idea than ever will be applied o Be focused upfront Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Criteria o Fit with business strategy o Time to completion o Durability of competitive advantage o Investments o Benefits o Market or market type o Durability of competitive advantage o Project type o Competitive impact on technologies o Risk profile The main roles in portfolio management o The portfolio sponsor à the senior manager responsible for the portfolio (representing the highest layers of an organization) o Portfolio manager à person responsible for the organization of the portfolio management (not for the decisions) o Portfolio analyst à provides the strategic overviews of the portfolio Also other senior managers, but certainly also program managers and project managers play an important role in managing the whole portfolio of projects. Chairman of the project board is responsible for the project. The whole process of portfolio management and selection can be tedious for various reasons: complexity, subjectivity, politics, weighing different aspects, the convincing power of mathematical models and not accepting the consequences of choices. Chapter 3 – The project manager Project organization Different ways of organizing projects within the parent organization - The project as sub-unit within the functional unit § Advantages Maximum flexibility in the use of staff Individual experts can be utilized by many different projects Specialist share knowledge and experience Serves as a base of technological continuity The functional division contains the normal path of advancement for individuals whose expertise is in the functional area. § Disadvantages Client is not the focus Too functional oriented No individual is given full responsibility for the project Several layers between project and the client Motivation tends to be weak Hardly able to respond to multi-discipline system engineering - The project as a pure/dedicated unit of the parent organization § Advantages Project manager full line authority over the project Team members directly responsible to the project manager Shorter lines of communication Strong and separate identity of the project team Swift decisions Unity of command exits Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Structurally simple and flexible Organizational structure supports a holistic approach to the project § Disadvantages A duplication of effort in every area Expensive Specialists loose contact with technical expertise area Inconsistency in the way in which policies/procedures are carries out - Matrix à hybrid of above “heavyweight” matrix à Project or strong matrix organization most resembles the pure project organization “lightweight” matrix à The coordination or functional or weak matrix most resembles the functional form § Advantages Project point of emphasis Project has reasonable access to the reservoir of technology in all area Less anxiety after project is done Response to client’s needs is a rapid as in the PPO. Gives good access to representatives from the administrative units of the parent Better company-wide balance of resources to achieve goals Flexibility is precisely how the project is organized within the matrix § Disadvantages Projectitis The division of authority and responsibility is complex: needs negotiation skills Violates the management principle of unity of command. (functional head and the project manager) The balance of power is very delicate Choosing an organizational form 1. Define the project with a statement of the objectives that identifies the major outcomes desired 2. Determine the key tasks associated with each objective and locate the units in the parent organization that serve as functional homes for these types of tasks. 3. Arrange the key tasks by sequence and decompose them into work packages. 4. Determine which organizational units are required to carry out the work packages and which units will work particularly closely with which others 5. List any special characteristics or assumptions associated with the project. The Project Management Office (PMO) is an organizational entity that gives support to the PM. The PMO is supportive; an enables/facilitator Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 The project manager “To lead the team in executing all activities to transfer an opportunity for capital investment into a project with a defined and agreed scope and deliverables and its implementation within agreed budget and schedule.” Functional managers are usually specialists & Project managers must be generalists that can oversee many functional areas. A good project manager: - Knows what you do not know - Fit for purpose: situational leadership - Build a complementary team. Chapter 4 – Building and leading the team What is a team “A group of people who work together towards a joint goal.” Joint approach Unique roles for team members Specific abilities required Performance criteria adopted Basic drives for team work o Security effect of cooperation o Performance effect of cooperation o Socialization effect of cooperation o Rewarding effect of cooperation o Learning effect of cooperation Team organization & responsibilities Responsibilities o Manage the team o Fairness, consistency, respect, honesty o Concern for members’ future after project Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Left: Venture team and related governance and assurance Right: Project team with a number of required functions Interdependency Pooled Sequential Reciprocal RACI chart: Types of coordination Responsible o Direct supervision Accountable o Formal guidelines Consulted o Formal and informal communication Informed o Training and drilling Tuckman’s stages in team development Teamwork and the level conflicts Initiation Development Execution Handover Team development Forming à trust and interpersonal relations have to be build Storming à people start experimenting Norming à roles will be accepted, the team starts developing based on agreed procedures, methodical working and established and tested ground rules. Performing à members are confident, motivated and familiar enough with the project and their team that they can operate without supervision. (Adjourning à The team disbands ) Leading the team: storming Soldiering Intra-team conflicts Disagreements among team member Inter-team conflicts Difficulties dealing with other related team Not delivering on time Lame excuses for not delivering Joint team learning behavior Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Chapter 5 – Value and project assurance Assurance 1. A positive declaration intended to give confidence 2. Promise or pledge; guaranty; surety 3. Full confidence; freedom from doubt; certainty Project controls are project internal processes executed by project controlled resources to assist the project manager that he knows project performance against plan, budget, quality and can trend the future. Project assurance is verifying the adequacy and completeness of project controls by a respected and credible party that is external to the project team. There is no hard data to demonstrate effectiveness of assurance activities on project outcomes, however it may assist in avoiding risk by identifying ‘unknown unknowns’. Line of defense. Milestones/stage gates are moments at which you make a decision à assurance of quality and completeness of deliverables supporting the decision just prior to reaching milestone. The main types of stage gate reviews are o Value assurance: are we doing the right project? o Value focus dominant at identify & conceptual design o Is there a robust (life cycle ) value promise? o Project assurance: are we planning and executing the project right? o Project focus dominant during executing o Is the life cycle value promise still robust? Roles and responsibilities o Assurance to be delivered to the party accountable for the activity o Clarity around organization and single point accountability o Assurance cannot also be accountable for deliverable of the project o Assurance assess decision quality Planning assurance o Developing an assurance plan is an opportunity to: o Leverage wide discipline expertise o Provide vehicle for involving specialist knowledge o Have an open and frank discussion about concerns/risks o Assurance reviews o Identify risks early and suggest mitigations o Use expertise and intuition to identify potential weaknesses o Identify further opportunities for value enhancement Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Value drivers Two types of quality o Product quality à the degree to which a set of inherent characteristics fulfils requirements o Result meets specification o Fit for purpose o Meets customer’s requirements o Satisfies customer o Process quality à the ability of the process to consistently deliver the conformance required o Project audits o Stage gate assurance (check whether the project and process deliverables are in place) o ‘are we doing the project right?’ Quality model (PDCA cycle) Plan: design or revise business process components to improve result Do: Implement the plan and measure its performance Check: assess the measurements and report the results to decision makers Act: Decide on changes needed to improve the process Chapter 6 – Opportunity framing Project proposal A project proposal can be written for a ‘complete’ project, including a feasibility study, preparation, legal arrangement, construction, handover/delivery Proposal is aimed at getting approval for the project (or the phase) Principles for doing a project plan Ø Structuring of the content (hierarchical) and of the process (time dependencies) Ø Use structuring techniques of System Engineering (systems and sub-systems with their interdependencies) Ø Structuring of the content (hierarchical) and of the process (time dependencies) Ø Use structuring techniques of Systems Engineering (system and sub-system with their interdependencies) Ø Use combination of top-down and bottom-up (average-out) Ø Appropriate level of detail (less detailed in the beginning, more detailed in later stages) Ø Define work packages that can be assigned to persons/teams Ø Define required input, activities and output (deliverables) for each work package Ø Define the interfaces and communication requirements as well as timely/logical dependencies between work packages Ø Clear definition of deliverable of each work package is essential – this enables an effective control if targets/milestones are reached (project controlling) Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Content, structure and use Scope You and your client should agree about the scope of the project upfront, in order to avoid negative surprises execution phase/ hand-over Project proposal: Work Breakdown Structure (WBS) à breaks down the whole project into manageable pieces Ø Milestone plan Ø Deliverables Ø Overall schedule Ø Finances Estimated budget Who pays what Proposed contract type Include remunerations schemes as well Project organization: Steering group, organizational units involved (internal/external), managerial responsibility and decision- making structure and stakeholders. Common mistakes: Reasoning not clear (collection of papers, puzzle, not followable) Client choose an unreliable project proposal Avoid unrealistic assumptions A boring/flat design and layout Make it not an academic report Opportunity framing kicks-off the project Opportunity framing à structured approach to understanding and defining an opportunity Deliverables opportunity framing 1. Agreed opportunity statement(s) 5. Definition of success 2. Stakeholder mapping and analysis 6. Decision hierarchy 3. Value drivers and critical success factors 7. Decision-based ROADMAP(s) 4. Beginning of a risk register Opportunity statement of a project à describes the project in a short and crisp way 1. The why à purpose/objective/aim/goal 2. What is the project à scope Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Define what the opportunity is and is not.. Is used to gain agreement and team focus on the opportunity. It should be clear and concise and should consider the full life cycle of the opportunity. Scope à “ensuring that enough, but only enough, work is undertaken to deliver the project’s purpose successfully” Project scope à the that needs be accomplished to deliver a product, service, or result with the specified features and functions. o What and why o Precise description of what you are going to do. o Scope creep à small increments / uncontrolled minor changes lead to ‘scope creep’. Beginning of failure (impact on costs, risks, schedule) o Poor definition and description of requirements o Poor change control o Lack of proper initial identification of what is required to bring about the project objectives o Weak project manager o Poor communication between parties o Scope change à prior identification of problems and a change in a project’s scope Explicit decision about a scope change Corresponding adjustments in resources, schedule, or budget Change management required o Reasons à Time influence (globalization, new legislation, new business partners, changed priorities etc.) Project scope à the features and functions that characterize a product, service, or result. Adaptive management à anticipates on current and future (unknown) opportunities Apply strategies of interaction o Alignment of stakeholders (interest vision, objectives) o At risk of limited project progress o Redefinition of the problem and change of scope o Requires change management The objective gives answer to the “why” question Chapter 7 – front end development Why front-end The main of FED is to provide owner representatives with a sufficiently complete image of the project to enable them to decide whether or not the project is worth investing resources in. Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Work breakdown structure o Hierarchical structure of the tasks o Breaks the work down into manageable pieces o An element can be either a product (PBS) or a function activity (WBS) o PBS : product-oriented Product-based division of deliverable items and associated services Contains PBS of the system and its sub systems o WBS : activity oriented The tasks and activities are defined to complete the different sub systems and include also activities to integrate the sub system with the overall system. o Clearly numbered for administrative purposes o Critical for budgeting risk identification o The WBS is a dynamic tool and can be revised and updated as need by the project manager o Helps with finances, organization, overall schedule, deliverables and milestone plan The WBS includes 100% of the work defined by the project scope and captures all deliverables – internal, external, interim – in terms of the work to be completed, including project management. At each level, the children of a parent node collectively and exclusively represent 100% of the scope of their parent node. Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Mutually exclusive elements o No overlap in scope definition between two elements of a WBS o It may lead to duplicated work or miscommunications about responsibilities and authority o It may cause confusion regarding project cost accounting WBS – the elements Functions à pervasive, on-going throughout project, project management documentation, quality control Phases/categories/subsystems à major components of the project Activities à Major work units, consist of smaller activities or tasks Tasks or work packages: smallest unit of work WBS level of detail o Small parts are easier to oversee and manage so reduction of uncertainty o Small parts are easier to understand, so reduction of complexity o 80/8 rule à a work package should not be longer than 80 hours or smaller than 8 hours Complexity Framework to grasp project complexity à TOE framework o Technical Scope content o External o Organizational Stakeholders Project team Market conditions Resources o Assessment of complexity in early project phase (selection of project manager) o Awareness in the project team o Areas of additional attention o Repeated complexity assessment o Means of communication between parties VIPs VIP à Value improving practices à out of the ordinary activities that provide input and add value to the standard activities and deliverables. - Value added depends on how the VIPs are applied - Structured approach = necessary but not sufficient - In the end it is about the people involved - There is an optimum you could apply Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Lessons learned à “a structured process for capturing, interrogating, analyzing, making systemic corrections, archiving and implementing lessons learnt during the inception, development and execution of an engineering project” Developing performances Compare your performance with other projects/industries o Internal vs external benchmarking o Leading role of Independent Project Analysis (IPA) in commercial benchmarking o Construction Industry Institute (CII) developed the Project Definition Rating Index (PDRI) which can be used as a tool for measuring the degree of scope development during the front-end development phases in industrial projects. Benchmarking is comparing ones business processes and performance metrics to industry bests and best practices from other companies. In project management benchmarking can also support the selection, planning and delivery of projects. Dimensions typically measured are quality, time and cost. New focus areas o Safety o Sustainability (triple P (People, planet, profit) / bottom line) o Integral / life-cycle approach Engineers are trained to treat technical complexity Perspectives of owners & contractors differs Importance of integrated team It is all about – even in Front End Chapter 8 – project risk management Why risk management Typically high uncertainties o Project management o Is about managing plans o Is about managing those uncertainties that do matter for achieving project promises o Project management is expectation management o Traditional risk management is projects has focused on the downside element of risk What is risk management A risk is an uncertain event or set of events which, should it occur, will have an effect on the achievement of objectives. Risks consists of a combination of the probability of occurrence of a perceived threat or opportunity, and the magnitude of its impact on objectives. Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Hazard à something that can cause harm, e.g. electricity, chemicals, working up a ladder, noise etc. Risk à the chance, high or low, that any hazard will actually cause somebody harm. TECOPS checklist: Technical, Economical, Commercial, Environmental, Political and Sustainable. Because of a cause (fact), an event might happen (the actual risk), which will have potential effect(s) on project promises (likelihood & impact) Likelihood (probability) most difficult to estimate Effect/impact (consequence) often easier to estimate Probabilistic risk management o Who owns the risk? o What will be the risk response strategy? o When to be executed? Residual risk à likelihood or consequence reduced, not zero Secondary risk à a result of the risk response strategy chosen Mitigation 1. Treat or Reduce a. E.g. changing design, concepts, contracting b. Treat à make the solution part of the scope c. Taking à develop contingency (who to do, if) d. Risks management starts in early project phases: it is affecting your scope/planning e. Choice in risk management have to do with own preferences/behavioural style/attitude towards risks 2. Take or Accept a. May be justified by expected return; e.g. recovery plans, financial reservation 3. Transfer a. E.g. insure, share, contract out, diversify, hedge 4. Terminate or avoid a. E.g. Ceasing activity, sale recalibrate, reduce scale o Should be part of the project activities from start o Helps to define the project o Helps to focus in project execution o Should not be a “tick the box” exercise Chapter 9 – contracting A contract is a legally binding, enforceable and reciprocal commitment governing the collaboration between two (or more) parties Essential elements of contract formation o Intent to create a legal relationship and legal capacity to act o Offer and acceptance o Compliance established practice and the law Value of Work Done (VOWD) à the value of goods and services received, measuring the technical/physical progress per control item and converting it into money. Breakdown the scope into contract packages 1. Marketability and commerciality of the packages 2. Project management consideration 3. Project management consideration Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Broken down project activities o Front End Engineering Design (FEED) o Detailed design and engineering o Procurement of materials and equipment o Fabrication and construction o Commissioning and start-up EPC = Procurement and Construction EPCM = Engineering, Procurement and Construction Management Lump sum/Fixed Price à the contractor is responsible for executing and completing the work as defined in the scope of work for a fixed price.Risks borne by the contractor. Reimbursable/ Cost Plus Fee à The owner reimburses the contractor for all costs, reasonably incurred and directly associated with the project. Plus a certain fee for the services provided. Payment to the contractor is made on the basis of work actually done. Cost Plus Percentage Fee Cost Plus Fixed Fee Cost plus Incentive Fee à (make the fee (in part) subject to performance against a number of criteria defined at the start Unit rate à The contractor carries the ‘productivity risk’ of executing the work as the owner is paying a fixed price for each unit. Chapter 10 – project monitoring & control – time Why estimating o Basis for control o Assess project viability o Obtain funding o Manage cash flows o Allocate resources o Estimate durations o Prepare tenders Types of estimates / timing Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Structure o Direct cost o Indirect cost o Labour cost o General and administrative cost § Direct labour cost (measured in § Cost of administering labour cost for a staff member per hour) § Transportation, training § Direct non-labour cost (e.g. o Overhead cost travel cost) § Project management, project o Material cost (consumables) support office § For project tasks (support § Financial / legal support, non- equipment, furniture, software direct staff etc.) § Phone bills, internet o Capital equipment Project cost components o Allowance To cover lack of scope detail (known unknowns) o Contingency To cover uncertainty in quantities and activities To cover for inadequacies in the base estimate To reduce the risk of budget overrun to an acceptable level o Escalation Inflation / deflation Market factor A base estimate, also called point estimate, is built up from the activities and deliverables identifies in a WBS. The more detailed the WBS becomes as the project matures, the more accurate the estimate becomes. Escalation à a provision in costs or prices for uncertain changes in technical, economic, and market conditions over time. Main components are inflation and market factors. Probabilistic estimating - Approximate probabilistic method - Exact probabilistic method (Monte Carlo) o Uncertainties taken into account o Uncertainties and risk taken into o Not exact probability density account function o Sample from exact pdf o Manual calculation possible o Estimate derived o Run 10.000 times o Good indication of expected value and distribution Project execution is all bout Doing = execution includes everything after initiation till final delivery Monitoring = collecting, recording and reporting information on project Controlling = bring performance in correspondence with planned performance Evaluating = reviewing/auditing project performance (product and process) Gedownload door Denisa Arsene ([email protected]) lOMoARcPSD|11547315 Managing = during execution there may be events that require attention and lead to a change project plans Types of measures – monitoring Raw numbers Indicators – indirect measures of a certain Frequency counts aspect Subjective numeric ratings – subjective Verbal measures estimate (e.g. estimate of quality) Earned value (EV) à the budgeted cost of work performed, also called value of work down (VOWD) Used as an estimate of the percentage of work completed thus far 𝐸𝑉 = 𝐵𝑢𝑑𝑔𝑒𝑡 ∗ (𝐶𝑜𝑚𝑝𝑙𝑒𝑡𝑒 % (𝑒𝑠𝑡. ) ∗ 0,01) Proportionality rule à count EV as percentage of work done 0/100 rule à only count activity’s if it completed, otherwise ignore it. Very conservative 50/50 rule à If it is started, it is assumed to be 50% If the activity is small (

Use Quizgecko on...
Browser
Browser