EXAM: PROJECT MANAGEMENT

THEME 1 – PROJECTS AND PROJECT MANAGEMENT

Gardiner, chapter 1 – Introduction to projects and project management:

Project management can be defined as the discipline of managing projects

successfully.
4 activities:
1) Planning – The participants need to know the goal, the steps to achieve it,
the order those steps take and when those steps must be complete. The
project manager works out what needs to be done, and how to do it within the
constraints of time and cost.
Planning documents: the activity plan (timescale of activities in each phase,
with their resulting end products), the resource plan (skills required) and the
budget plan (details of all the costs).
2) Organizing – arranging the people, material and support resources in order
to meet the needs of completing the project on time. At the start of a project,
everyone should be aware of what their role is, what their responsibilities are
and who to report to. Everyone needs to be committed to the project and
share the same objectives.
3) Controlling – the project needs to be managed as specified in the planning
documents. The project manager should meet with the project team regularly,
to review progress and sort out minor problems.
4) Leading and motivating – it takes leadership to get people motivated to do
the right things. Project leadership involves shaping goals, building roles and
structures, establishing good communications, seeing the whole picture etc.
Skills such as communication, negotiation, team building etc are essential for a
project manager.

Hard skills – mechanical and technical skills of planning, scheduling a project.

Soft skills – people skills, interpersonal communication, commitment to success
etc. These skills are the hardest to learn and use effectively.

Where do projects come from? Ex: a market demand, a business demand, a

customer request, a technological advance, a social need etc.

Programme management:
A programme – group of projects managed in a coordinated way to obtain
benefits not available from managing them individually.
Differences between project management and project management – both are
trying to achieve change in controlled manner. The difference lie in the level at
which the change is controlled. A project has a definite beginning and end, a
programme is an ongoing concern with new projects joining and existing ones
finishing.

Gardiner, chapter 2 – A systems view of project management

Systems theory: brings structure and order to an otherwise chaotic and

unpredictable environment.
Inputs: defined as energy in any form brought into the system.
Processes: defined as a series of actions, changes or functions that bring about
a particular result.
Outputs: defined as the products or consequences that result from the
processes performed.
The systems approach can be applied to a whole system or just part of a
system.
Projects and organizations are open systems – they interact with their
environment.

Inputs- resources necessary for a project:

Business need and requirement, human resources, physical resources, project
constraints, organizational and environmental factors and information
resources.

Outputs- projects results and end products: ex: reports, software etc.

Processes- the project processes act on the resources (inputs) to produce the
project result (output).
Feedback is important in a system because it can be used to regulate and
control the system.
Feed-forward systems: accurate prediction of future event can only be based
on how similar events took place in the past. Thus, feed-forward systems
depending on some kind of memory. Memory allows feed-forward mechanisms
to anticipate output errors that have occurred in the past under similar
circumstances  feed-forward = prevent errors.

Feedback – used as a means of changing a system through evaluation.

Project life cycle: projects move through a set of phases.

Phase 1: Initiation and definition. This is the start of the project.
Phase 2: Planning and development. This forms the basis of project control
throughout project execution and delivery. Ex: scope management plans, work
plan and timeline, resource and budgetary plans, risk management plans etc.
Phase 3: Execution and control. As a project progresses, new information and a
better understanding of the clients’ circumstances can lead to requests for
change. Project management is about managing expectations and delivering an
end result in keeping those expectations.
Phase 4: Closure. This represents the end of a project. It provides opportunity
for formal project evaluation.

Managing information between different project phases is central to effective

project management. When managed effectively, there is an open exchange of
information between all the phases of the project.

Fast tracking: the shortening of a project life cycle by overlapping project

phases. It can reduce the duration of a project and its overhead costs.
However, the approach can lead to confusion, uncertainty and expensive
rework when things go wrong.

Software and systems development project life cycles:

Code and fix: code, test, debug.
Waterfall model: systematic transition from one development phase to the
next, until the project is complete.
Incremental model: overlapping phases. Trying to produce usable products at
the end of each section.
Rapid prototyping: a trial model in the beginning. If it is successful  transform
into waterfall model.
Spiral model: cyclic approach. It allows for significant evolution of project
requirements from one cycle to the next.

The life cycle of a project in event management revolves around the ability to
make decisions in a changing environment. Managing in a changing
environment relies on two key capabilities:
1) The capability to make optimal decisions quickly.
2) The capability to communicate those decisions and have them carried out.

Classifying projects:
1) Participant mix (internal, external, mixed)
2) Degree of standardization (concrete, occasional or open)
3) Project visibility (High visibility: critical to organizational survival, high risk of
failure, typically require a larger amount of organizational change. Low
visibility: not seen as critical or urgent, lower probability of failure, simple
adaptations of organizational change)
4) Business need (EX: projects that deliver technological advantage, these
projects can lead to new innovations, open up new markets or increase existing
market share)
5) Size and complexity (The number of tools and techniques that are used and
the systems put in place for communication, integration and marketing will all
be influenced by project size)
6) Industry (EX: software, building, construction)

If everyone involved in a project works to the same methodology, this reduces

communication and integration problems throughout the project life cycle.
Article 1: KRISTIAN KREINER – Project management in drifting
environments

Projects are social and temporary organizations.

Environmental drift: Projects receive, and often seek, feedback from the
environment during implementation. The project reads the environment not as
it is, but as it is modeled by the members of the project. Thus, the project
responds to its own image of the environment  “self-referential system”.

Managerial strategies
Hierarchy as a managerial strategy:
Vertical order. This is signified by the situation where the responsibility for
relevance and legitimacy is surrendered to some organizational “fixed point”
(EX: a boss).
Networking as a managerial strategy:
Networking is a way of supplementing the projects’ formal relationships with,
and obligations to, the various interested parties in the environment. Ideally,
networking allows the project and the environment to co-evolve (to drift
together rather than apart). Networking is guarding the project better against
the risk of oversight, since it exposes the project to much environmental chaos.

Neither hierarchy nor networking will work as an exclusive strategy for project
management. Project managers must therefore ensure that both strategies
remain an option throughout the duration of the project 
There must be fixed points for the performance (operational goals, specific
tasks, action plans) ASWELL as social bonds with the environment providing the
drive for responding to changing relevance criteria.

Article 2: A GUIDE TO THE PROJECT MANAGEMENT BODY OF KNOWLEDGE

Project characteristics
Temporary – every project has a definite beginning/end. The duration of a
project is fixed.
Unique products, services or results – uniqueness is an important
characteristics of project deliverables.
Progressive elaboration – developing in steps.

Projects VS. Operational Work

Organizations perform work to achieve a set of objectives. This is made through
either projects or operations. They SHARE these characteristics:
- performed by people
- constrained by limited resources
- planned, executed and controlled

They DIFFER in the sense that operations are ongoing and repetitive while
projects are temporary and unique.

Projects and strategic planning:

Projects are used as a means of achieving an organization’s strategic plan.
Projects usually exist because of some strategic considerations, EX: a
technological advance.

“The triple constraint” – project scope, time and cost.

A standard – a document established for providing rules, guidelines etc.

A regulation – government-imposed requirement, which specifies product,
process or service characteristics.

Understanding the project environment:

Cultural and social environment – how project affect people and how people
affect the project. Economic, demographic, educational etc. issues. It is also
important to examine the organizational culture.
International and political environment – international, national, regional laws
and customs. Political climate can also affect the project.
Physical environment – local ecology and physical geography can affect the
project.

General management – is planning, organizing, staffing, executing and

controlling the operations of an ongoing enterprise. This provides the
foundation for building project management skills.

Interpersonal skills:
- Effective communication – exchange of information
- Influencing the organization – “get things done”
- Leadership – vision and strategy
- Motivation – energizing people

- Negotiation and conflict management – conferring with others to reach

agreement
- Problem solving

Programs and Program Management

A program – a group of related projects managed in a coordinated way to
obtain benefits and control not available from managing them individually.
Project management – centralized coordinated management of a group of
projects to achieve the program’s strategic objectives and benefits.

Subprojects – projects frequently get divided into more manageable

components  subprojects.

Project Management Office (PMO) – an organizational unit to centralize and

coordinate the management of projects under its domain.
THEME 2 – STRATEGY, GOVERNANCE AND DECISION-MAKING IN THE
TEMPORAL ORGANIZATION

Gardiner, chapter 3: STRATEGY AND GOVERNANCE

Projects are implemented as a means of achieving an organization’s strategic

plan.

It should always be possible to show how a project supports the strategic goals
of the sponsor’s organization; otherwise it consumes resources but fails to add
value.

Four fundamental factors of governance:

1) Accountability – capacity to call officials account for their actions
2) Transparency – low-cost access to relevant and material information
3) Predictability – laws and regulations, known in advance
4) Participation – obtain reliable information. It is serving as a reality check and
a watchdog for stakeholders.

The corporate governance system consists of:

- a set of rules (that defines relationships between different stakeholders)
- a set of mechanisms (to enforce these rules directly or indirectly)

IT governance:
There is a growing realization of a need for central IT coordination and
planning. Today, most routine tasks are automated.
IS Strategy Triangle:
Business strategy – Information strategy – Organizational strategy
These three points of the triangle should be in balance in any organization. This
triangle suggests an implicit relationship between projects and information
systems.

Project governance:
The set of structures, systems and processes around the project that ensure
the effective delivery of the project .
A project governance helps to ensure that:
- the scope of the project is defined  stakeholders are adequately
represented
- there is a clear understanding of roles
- resources are available
- overall project timelines are set and achieved

Gardiner, chapter 4 – INVESTMENT DECISION MAKING:

Feasibility study – an accurate assessment of the factors which might affect a

project or a programme. It enables a realistic evaluation of a project,
incorporating both the positive and the negative aspects of the opportunity.

Business case (for obtaining management commitment and providing a

framework), for a LARGE project (EX: UPS):
- a project description
- description of various stakeholders, and details of their requirements
- thorough analysis of costs and benefits
- description of project’s impact on business processes, staff and organization
- detailed recommendations for the IT project
- executive summary describing the business requirements that the project
addresses, the recommended solution and a summary of project costs and
other impacts.

Project appraisal – purpose is to assist an organization in deciding whether a

project concept is worth turning into reality. Important concepts:
- financial vs. economic appraisal
- cash flow analysis  requires preliminary information about the evaluation
period, expected return and return risk, the organization’s cost of capital and
the cost of doing the project.

Project selection is closely related to an organization’s long-term strategy and

business plan (UPS case).
Article 3 – A THEORY OF THE TEMPORARY ORGANIZATION (LUNDIN &
SÖDERHOLM):

Temporary organizations are normally created in order to fulfill a special

purpose.
Four concepts:
1) Time – it only exists a limited amount of time. “Time is money”. Problems
with time: uncertainty, conflict resolution  EX: need for time schedules.
2) Task – the creation of a temporary organization is motivated by a task that
must be accomplished.
- Unique task: created for one single specific situation that will not occur again.
- Repetitive task: will be repeated in the future.
Actions come about in quite different ways in relation to different tasks.
3) Team – individual’s beliefs, attitudes and expectation will influence
teamwork.
- relation between the individual and the team
- relation between the team and the environment
4) Transition – the temporary organization’s concern with progression and
achievement or accomplishment. The transition embodies the task.
THEME 3 – PROJECT INITIATION, GOAL SETTING AND THE
MANAGEMENT OF TEAMS, RISK AND UNCERTAINTY

Gardiner, chapter 7 – MANAGING RISK AND QUALITY

Project risk – “an uncertain event or condition that, if it occurs, has a positive or
negative effect on a project outcome”.

Two categories of risks:

1) Speculative risk – a chance of a profit or a chance of a loss.
2) Pure risk – only a chance of a loss.

Three sources of risks:

1) Factors under project control (EX: poor design)
2) Factors under wider external environment (EX: changes in government
policy)
3) Uncontrollable factors (EX: natural disasters)

Risk management is about balancing the harmful effects of risk against

potential project benefits.

Risk management:
Risk assessment activities -
* Identification of risks – determining all the risks likely to affect a project and
documenting their characteristics in an understandable way  several areas
where risk often can be identified (EX: technical risks – new technology, level of
experience etc.)
* Risk analysis – establishing the probability of occurrence and the impact of
occurrence of all identified project risks.
* Risk prioritization – rank or prioritize each risk in order of importance.

Risk control activities -

* Risk response planning – the production of plans for responding to and
controlling each risk.
* Risk resolution – the elimination of a risk by executing activities in the risk
response plan.
* Risk monitoring and reporting – keeping track of the project’s progress
towards resolving each risk.

Contingency planning (if all else fails) – identification and planning of

alternative activities to implemented in the event of a risk. The plan should
identify alternative resources and/or processes.

Useful tools to help manage risk:

* Keeping a risk register – managers are more likely to act on written
information.
* Risk concept map – a flow diagram, showing in one picture the risk scenario
for the project.

Quality management:
* Product quality – a good quality product is one which is fit for use. Example of
factors important when considering products: performance, operation,
reliability.
* Service quality – depends more heavily on staff skills. A manger needs to
customize a service for each person.
* Process quality - refers to the quality of all the activities that come together
to produce and deliver the products and services of an organization.

Deming – problem solving: PLAN  DO  STUDY  ACT (repeat)

Quality Management Processes (all the processes required to ensure that the
project will satisfy the needs for which it was undertaken):
* Quality planning – which quality standards are relevant to the project.
* Quality assurance – evaluating overall project performance on a regular basis
 ensure it satisfies relevant quality standards.
* Quality control – monitoring specific project results, and identifying ways to
eliminate causes of unsatisfactory performance.
Cost of quality:
* Prevention costs – all activities designed to prevent poor quality in products
and design.
* Appraisal costs – measuring, evaluating products or services to assure
conformance to quality standards.
* Failure costs – resulting from products/services not conforming to
requirements (can be both internal/external failure costs).

Gardiner, chapter 8 – PROJECT INITIATION & TEAM BUILDING

Initiation and definition are about doing the right things in the early stages of a
project. Initiation is the process of formally authorizing a new project or
recognizing that an existing project should continue into its next phase.

Project scoping – defining a project’s mission and purpose:

it is all about tuning in all the stakeholders to the project, the goals of the
project, and how the project is going to benefit the organization and its people.

It is also the first real opportunity to create a team environment. A poorly

managed scoping exercise is a harbinger of trouble later in the project.

Identifying the project’s requirements (feasibility report & the business case,
see ch. 4).

Scoping – the process of establishing and agreeing with all the stakeholders
what the project will involve and where its boundaries are.
The aim of project scoping is for EXAMPLE; get a good understanding the
expectations of the main stakeholders and the main activities that will be
carried out.

The project charter – high level document that records and communicates the
results of the scoping process to project stakeholders. There are often many
changes made as the process go along, therefore the project charter needs to
be revisited throughout the project.
By defining project requirements, the scoping process should establish and fix
the expectations of the project for all the stakeholders.
Critical Success Factors (CSFs) are the deliverables that must be achieved in
order for the project to succeed.

It is a good idea to make the objectives for a project SMART:

Specific – clear not vague
Measurable – quantifiable
Achievable – attainable in the short term (keeps you going)
Result-oriented – concrete, easily identified
Time-based – shows when it is required in relation to other objectives

Value management – technique used by organizations to help define business

objectives and identify the best ways to achieve them with a focus on balancing
stakeholders needs and expectations with available resources.

Three universal constraints to any project:

* Scope – a specification. It provides clarity to everyone concerned with the
project, about what work is and what is not included in the project.
*Time – the length of time agreed for the project. Time is managed in a project
with the aid of networks and schedules.
*Resources – project activities use resources which in turn cost money. For
example people, equipment, knowledge.

SCOPE-TIME-COST TRIANGLE
No matter how skilled the project manager is and how well the project has
been planned, the unexpected can occur. Therefore a project manager needs
to know (preferably in advance) where adjustments can be made if necessary.
The triangle is used by stakeholders placing a coin on the constraint they find
mostly relevant and important  shows priorities. Unless these priorities are
established, inappropriate trade-offs might be made. Having a clear idea of
where priorities lie in relation to project objectives can help project managers
make better decisions.
Breakdown structures
A project can be defined in two ways:
1) In terms of its deliverables - the products and services it’s going to provide
2) In terms of its activities, which means a unit of work that results in a
deliverable, which can be done by a person or a team of people.

To define a specific project fully, we need to know all its deliverables and
activities

“Chunking” – breaking up a project into smaller, more manageable “chunks”.

Each chunk represents a different part of the project. If the chunks still are too
big, they can be divided into a new level  hierarchy of levels. This breaks up a
large system/project into a logical structure for management and
communication purposes  resulting structure is called BREAKDOWN
STRUCTURE. This way, it is easier to communicate to stakeholders the amount
of detailed information they are looking for.
Breakdown structures can be used to define:
* Product scope – the elements that make up the end product/service (Product
Breakdown Structure  PBS. Used mainly on projects producing complex end
products)
* Project scope – all the project activities (Work Breakdown Structure  WBS.
Top-down: project manager’s job to coordinate everyone’s input and make
sure nothing is left out. Bottom-up: brainstorming with team members to
identify lower level activities. The WBS serves as a checklist for the work
required in all areas of the project)
* Human resources – the people who will carry out the activities (Organization
Breakdown Structure  OBS. It establishes for all concerned who the other
participants are, both on their immediate team and in the wider project team)

The project team – assembling an effective team is a challenge that requires

the right mix of people and combination of roles to achieve the best result.
Belbin’s team roles: identifying team roles  a healthy mix can be put together
and the team would be more effective.
Conflict management:
Reason for conflict in organizations  tremendous amount of change that
occurs in the workplace. People may disagree on how to adapt to those
changes.
Conflict resolution styles:
1) Obliging/smoothing
2) Dominating/forcing
3) Avoiding/withdrawing
4) Integrating/problem-solving
5) Compromising

Fundamental needs of an effective team (John Adair):

* Individual needs – developing individuals
* Team needs – maintaining team spirit
* Task needs – achieving the task

Team-building model, four essential aspects needs to be considered:

1) Create the right environment
2) Create effective communication channels
3) Create strong personal and interpersonal values
4) Develop flexible leadership achieving styles

No amount of team-building or leadership skills will produce a successful

project if the project concept is flawed, or if top management is unsupportive.

Article 4 – THE FUTILE DREAM OF THE PERFECT GOAL – Mats Engwall

A large amount of projects seem to fail because of their goals.

Projects are initiated in order to achieve something. Thus, the goal is the core
element of every project’s existence.
A project is divided into three stages:
1) Project selection – client defines the project
2) Project execution – the objectives of the assignment are realized
3) Project assessment – the final results are compared with the original goals
and intentions

The predetermined project goal should be explicit, specified in detail, internally

consistent, and stable over time. The goal should also be specified in three
dimensions:
1) Performance – what is to be done during the project (technical specification)
2) Time – when the work is to be finished (time schedule)
3) Costs – what amount and which type of resources are allowed to be spent
(project budget)
These goals should then be broken down systematically into clear and
consistent objectives and milestones.

The primary function of a stipulated project goal is to create a start, not predict
final outcomes.
Ambiguous goals is necessary to have in project initiation  they can unite
stakeholders with different interests. However, they provide few details about
actions that are necessary. An ambiguous goal can be means of gaining support
by allowing one and the same project to be seen in different contexts and to be
given different meanings.
Gradually during the course of project execution, expectations and experiences
become coherent and, in the end, the goal becomes definite. Goal formation is
thus a core element of project execution.
Exogenous goal – ideally, all the necessary knowledge should be available
during project selection and there should be no unplanned learning during
project execution. This ideal of an exogenous goal is based on the idea that it is
possible to fully specify the content of a project before it is executed in
practice.
During project execution, knowledge is developed with regard to what the
project “actually” means. The project goal acquires a concrete gestalt. The
participating actors acquire hands-on experience of the project content 
project execution process becomes a mutual experience.
During the execution process, the participants gradually acquire insights into
what would have been possible to accomplish under different conditions. At
the end, the goal is not just an abstract text anymore; instead it is referring to
practical experiences gained from actions, outcomes, mistakes, and successes
achieved during execution.
The project goal provides direction. It focuses on the preferred state of the
future. Furthermore, the goal relates future outcomes to actions and activities
carried out today.
Instead of the image of project execution as a linear process whereby the goal
is directly translated to a final result, it is better understood as a non-linear
process of goal formation, revolving around predetermined goals, evolving
expectations and gradually gained experiences.
Project management is not a passive process of implementing already –defined
objectives, it is rather the active art of creating conditions, meaning and
expectations for the future.

Article 5 – CREATIVE LEADERSHIP PROCESSES IN PROJECT TEAM

DEVELOPMENT - Rickards & Moger

Creativity – a multifaceted process through which novel and relevant outputs

emerge.
Creative leadership – the behaviors of leaders in a wider category seeking
creative or innovative outputs.
Tuckman’s model of team development: form, storm, norm, perform
Creative leadership appears to impact a number of team factors:
*Platform of understanding
* Shared vision
* Climate
*Resilience
* Idea owners
* Network activators
* Learning from experience

Article 6 – FUNDAMENTAL UNCERTAINTIES IN PROJECTS AND THE SCOPE

OF PROJECT MANAGEMENT – Atkinson, Crawford & Ward

Three types of uncertainty:

1) Uncertainty in estimates – potential variability in relation to performance
measures. Includes for EXAMPLE; lack of clear specification of what is required.
Uncertainty results from vagueness, ambiguity and contradicitions.
2) Uncertainty associated with project parties – (stakeholders) EX: uncertainty
about the level of performance that will be achieved. Different parties will have
different perceptions of risks associated with these objectives, and therefore
may wish to adopt different strategies for managing related project
uncertainty.
3) Uncertainty associated with stages in the project life cycle – a failure to carry
out the design and plan stages thoroughly enough. Thus a project proceeds
through to execution with insufficient well-defined specifications for
production.

Project risk management:

1) Treat the definition of the objectives as a key part of managing projects
2) Project management should clarify and manage desired trade-offs between
multiple performance objectives
3) Ownership of uncertainty needs explicit consideration

HARD/SOFT PROJECTS????

THE IRON TRIANGLE – Atkinson, initiative to extend the time-scope-cost

triangle to include benefits and value criteria.

The degree of stakeholder involvement and the expectations of stakeholders in

terms of interaction will also affect the ability to reduce uncertainty in the
interests of achieving clarity and control.

As projects take on more ‘soft’ characteristics, the importance of project

parties as contributors to project uncertainty increases. Then much depends on
the motives of different parties. Total control over the activities of project
parties is neither possible nor desirable  too much control leads to that
project staff feel like they are not trusted. Any lack of trust can produce
dynamic that prevents success. Thus, a mixture of trust and control is needed.
Organizations which have efficient and effective systems for co-ordination and
control, environmental scanning, and organizational learning will be fairly well
placed to foster efficient and effective uncertainty management.
Cultural aspects (such as EX: attitude to planning, formal procedures,
regulations etc) can either facilitate or hold back the development of
uncertainty management.

The capture and re-use of learning from one project to another is generally
accepted as something that should be done but it often goes no further than
capture.
If uncertainty is acknowledged, then it is more likely that an environment
encouraging to openness and learning can be created. Further, the learning
extracted is likely to be more reliable and useful in reducing uncertainty in
future projects.
THEME 4 – STAKEHOLDERS AND PROCUREMENT

Gardiner, chapter 5 – THE PROJECT MANAGER, SPONSORS AND OTHER

STAKEHOLDERS

Project stakeholders – individuals, groups and organizations who are actively

involved in the project, or whose interests may be positively or negatively
affected as a result of the project. Stakeholders can be internal or external to
the project.

The role of the project manager – ‘to attain the projects objectives’.
Two guiding principles for the project manager:
1) All decisions should be directed towards achieving the project objectives
2) Only the remaining work in the project can be managed

Meeting the needs of the sponsor:

The sponsor is the strongest project stakeholder. The sponsor is the project
manager’s boss.

The project leader has the responsibility to ensure that all team members
perform well, both individually and collectively.

Core competencies required from a project manager is:

Soft skills – behavior, attitudes, communication styles and leadership.
Hard skills – set the goal and procedures  soft skills make sure that people
can meet those objectives

Senior management – decides whether the project will proceed. They also
determine the extent of support the project will receive relative to other
projects. The role of S.M is to MANAGE. Feedback up and down the chain of
command is absolutely essential.
The project board – a group of people, usually from within the sponsor’s
organization, which have been given responsibility for making executive-level
decisions on behalf of the sponsor, throughout the project.

The project champion – someone who grasps the benefits of and is enthusiastic
about the project.
Pinto & Slevin – states that there are four types of project champions:
1) Creative originator – EX: scientist, driving force behind the idea
2) Entrepreneur – actively works to ‘sell’ the project, pushing it to success
3) Godfather (sponsor) – senior-level manager, doing everything possible to
promote the project
4) Project manager – handles the operational planning and day-to-day details

Consultant- acting on behalf of the client to deliver a service, usually in the

form of:
* Advice
* Information
* Assignments

Contractors – external participants of the project. Often appointed to conduct

an activity which has already been clearly defined by others.

When all stakeholders ‘dance to the same tune’, the project moves towards a
successful outcome.

Stakeholder identification and analysis:

Stakeholders are embedded in organizational cultures. It is important to have
an appreciation for what kind of organizational cultures to which they belong.
It is also important to identify where one stakeholder’s expectations clash with
those of another and encourage the parties to talk to each other.

POSITION/IMPORTANCE MATRIX
POWER/PREDICTABILITY MATRIX
POWER/INTEREST MATRIX

Gardiner, chapter 6 – ORGANIZATION AND PROCUREMENT

Project organization – structuring and integrating the internal project

environment through careful planning and organization design.
Procurement – implementing projects using external resources and expertise
for all or part of a project.

There are two basic organizational structures:

1) mechanistic structures – command and controlled based
2) organic structures – using special knowledge with open communication

Functional structure – most common organizational structure. People are

grouped by discipline and their level of authority in a top-down hierarchy.
Main characteristics:
* deep structures
* weak coordination and communication between functions
* no customer focal point
* allegiance and commitment
Main advantages:
*vertical communication channels
* manager has complete control over manpower resources, budgeting and cost
control
* large concentration of specialists
* investment in function
Not suitable for rapid and efficient execution of projects. Also, the functional
structure is slow to respond to environmental changes.

Product structure:
In this structure, people are organized according to the product line,
programme or project, they belong to.
Main characteristics:
* the participants work directly for the product
* strong communication channels
* loyalty to the product
* rapid reaction time to problems and issues
However, a risk with this structure is that there will be a risk of low innovation
and application of new technology over time.

The functional resource is more resource-efficient and provides greater

specialist knowledge. However, communication and project control are
generally better developed in the product structure.

Matrix structure:
Combination of functional and product structure. It is the most complex form
of organization structure, providing for maximum information exchange,
management coordination and resource sharing. However, it has a tendency to
generate conflict and can suffer from constantly changing boundaries and
interfaces.

Supply chain management:

Two methods of realizing a project:
1) In-house (do it all yourself)
2) Procurement (pay a supplier for goods and/or services relating to the
project)
As a project increases in size, complexity or value, a project sponsor will decide
to use the services of one or more suppliers.
Managing the external relationships in the supply of goods and services 
supply chain management. Trying to identify unnecessary or nonproductive
costs that can be taken out of the system.

Procurement planning:
1) Requirement planning – definition and boundary of procurement
2) Solicitation – identifying the supplier
3) Awarding – final contractor selection
4) Contract administration – managing a contractor until completion of the
contract

Types of payment of contractor (two principal payment methods):

- Fixed price – payment of a specific amount for delivery of specified supplies or
performance of a specified service
- Cost reimbursement contract – an estimated cost and a fixed fee
Partnering – two or more organizations working together to improve
performance through agreeing mutual objectives. The aim in partnering is to
secure the best possible commercial advantage.
Article 7 – VISUALIZING AND MAPPING STAKEHOLDER INFLUENCE – Bourne
& Walker

Successful completion of projects is critically dependent upon relationship

management skills. Therefore, it is important to identify stakeholders. Project
managers need to be able to understand the often hidden power and influence
of various stakeholders  contributing knowledge, insight and support in
shaping projects.

Tools for visualizing stakeholders and their influence:

Cleland offers a process managing stakeholders – identifying appropriate
stakeholders; specifying the nature of the stakeholder’s interest; predicting
what the stakeholder’s future behavior will be to satisfy him/her; evaluating
the impact of the stakeholder’s behavior on the project team.

Project managers need to be aware of the types of power that people can
wield to influence the opinions and actions of others. A useful tool for
visualizing power and influence patterns is social network mapping  this is
done by interviewing people to find out who knows who, in what context and
the strength of the influence.

Article 8 – FROM CLIENT TO PROJECT STAKEHOLDERS: A STAKEHOLDER

MAPPING APPROACH – Newcombe

Stakeholders – those who have a stake in the project.

Stakeholders interact with the project in two primary arenas:
1) The cultural arena – ideology and shared values. Culture is a force for co-
operation between the stakeholders.
2) The political arena – this is where the stakeholders exercise power to
achieve their objectives.

Stakeholder management principles:

Principle 1 – the project should be managed for the benefit of ALL its
stakeholders.
Principle 2 – project managers bear a trustee relationship to the stakeholders
and to the project as an abstract entity.
THEME 5 – SCHEDULING, BUDGETING, CONTROL AND EVALUATION

Gardiner, chapter 9 – ESTIMATING, SCHEDULING AND BUDGETING

The project schedule – sequencing project activities and milestones into a

sensible, logical order to aid project execution and control.

Good estimates of activity duration are crucial in project scheduling. There are
three ways to estimate the activity duration:
1) Use historical data
2) Time the activity
3) Use a probabilistic method

When activity durations have been established, the next step is to define the
logical relationships between activities and construct a network diagram to
reflect these.
A NETWORK DIAGRAM not only shows the relationships between activities but
can be used to reveal which activities are time-critical  call for greater
management attention.
Analyzing the network to determine the CRITICAL PATH:
The critical path is defined as the path through the network having the longest
duration. All activities on the critical path should be called CRITICAL ACTIVITIES.
In some projects there may be more than one critical path. The critical activities
are most likely to cause the project delays to the schedule. By identifying these
activities it provides knowledge to the project manager to know what issues to
focus on so they will not cause delays.

GANTT CHARTS:
This is another way of representing scheduling information.
* Activities are arranged from top to bottom
* Time is plotted to scale from left to right
* Activity bars begins at their earliest start time
* Critical activities are highlighted
Gantt charts play a useful role in a project but are limited in their ability to
convey clear understanding of the logical relationships of the project.

Methods for shortening the duration of a project:

* Project crashing – additional resources are assigned to one or more critical
path activities. Crashing a project incurs additional cost.
* Fast tracking – overlapping to or more major project phases
ETC.

Project management software packages – this can be used to help plan and
control a project. The software calculates the earliest and latest start and
completion dates and enables schedules, charts and reports.

Project budgeting – used by managers to fix in advance the resources that a

project will use. It is all about allocating resources to a project  how much
money will be allocated to the project. Project budgeting is also about how
much detail to include in a budget.

The building blocks of a budget:

* Expenditures – projects consume resources  resources cost money.
* Revenues – money generated by a project. When a project is completed, it
must have generated revenue.
* Cash flow – the money going out and coming in during a project. It is an
important indicator of the health of a project.

Budget as a yardstick:
A well-structured budget can measure performance of organizational units and
their managers. It also enables the managers to make rapid decisions about
how to steer a project that is overspending back into line with baseline
budgets.

Top-down budgeting: senior-management sets project budgets. One drawback

of this method is the senior-management’s limited knowledge of the specifics
of each project and its activities.
Bottom-up budgeting – budgets are developed on the activity-level and
upwards.
Iterative budgeting – dynamic process involving a two-way flow of information.

Risk and management reserve – project managers build some “fat” into their
cost estimates.

The budgeting process should consider the information needs of the different
project stakeholders – who may measure project costs in different ways at
different times.

Major budgeting processes:

* Resource planning – what resources to include? (people, equipment,
materials)
* Cost estimating – developing an approximation of the costs of the resources
needed. Tools for this: analogous estimating (expert judgment), parametric
estimating (using project characteristics to predict costs)
* Cost budgeting – relating cost estimates to schedule
* Cost control – controlling cost in relation to schedule

Gardiner, chapter 10 – CONTROL, CLOSURE AND CONTINOUS

IMPROVEMENT

Project control – the process of ensuring that the project delivers everything it
is supposed to.

Effectiveness of project control systems – can be measured by its average

response time  the average time between the occurrence of a deviation
outside the control limits and its detection. Also, it can be measured by its
traceability (ability to identify the source of a problem causing deviation).

Change management and control:

* Influencing the factors which create changes to ensure that changes are
beneficial
* Determining that a change has occurred
* Managing the actual changes when and as they occur
Change is a normal part of a project, although it should be carefully controlled.
Written guidelines and procedures for all participants to follow is a good
practice to have, if it is needed to change baseline plans.

Types and sources of change:

* Change arising from the project team
* Client-initiated change
* Changes originated from external sources

Change management plan:

Identify the change  Analyze the effects of change  Develop a response
strategy  Communicate the strategy and gain endorsement for the change 
Revise the project plan and monitor the effects of change

Milestone monitoring:
Milestones must be specific, measurable events, defined with unambiguous
boundaries. A milestone is either achieved or not achieved.
Two essential pieces of data for each milestone:
1) The date the milestone is scheduled to be achieved
2) The budgeted cost of all the work needed for that specific milestone

Earned Value Analysis (EVA) – cost/schedule control system. It compares the

value of actual work completed (earned value) against planned progress and
actual expenditure. One of the difficulties with EVA is that people can have
difficulty with measuring completed work because some activities are too
complex or does not have clearly identifiable deliverables.

Project closure – closure activities should be ongoing throughout the life of a

project. In this way, project closure can be completed in an efficient and timely
manner. Benefits: capture and distribute the experience, the skills and
knowledge that have been developed during the project. A well-planned
project closure provides benefit to all the project stakeholders.
Planning for closure should result in written instructions  closure plan.

Final project evaluation – this provides an opportunity to capture lessons

learned during the project.
Determinants of project success and failure:
Project success (Pinto & Slevin):
1) Project mission
2) Top management support
3) Project schedule and plans
4) Client consultation
5) Personnel
6) Technical tasks
7) Client acceptance
8) Monitoring and feedback
9) Communication
10) Troubleshooting
11) Characteristics of the project team leader
12) Power and politics
13) Environmental events
14) Urgency

Project failure, methods to ensure project failure (Pinto & Kharbanda):

1) Ignore the project environment
2) Push a new technology to market too quickly
3) Don’t bother building fallback options
4) When problems occur, find a “syndabock” and fire him/her
5) Let new ideas starve to death
6) Don’t bother conduct feasibility studies
7) Never admit a project is a failure
8) Overmanage project managers and their teams
9) Never conduct post-failure reviews
10) Never bother to understand trade-offs
11) Allow political convenience
12) Make sure the project is run by a weak leader

CRITICAL CHAIN PROJECT MANAGEMENT

Theory of constraints (TOC), Goldratt:
Every system is subject to at least one constraint which prevents the system
from achieving infinitely high levels of performance. Thus, an organization’s
performance is DEPENDENT ON ITS WEAKEST LINK. A system constraint is
anything that limits the system from achieving higher performance towards its
goal.

Goldratt suggests that DURATION is the major constraint of projects. The

minimization of project duration is a key project goal and it can enable an
organization to create a competitive advantage over other firms.

According to Goldratt, the main reason for project overrun is because of the
misuse of the safety time created within the estimated times for each project
activity. He argues that since employees know that the safety time is built into
estimates, they do not need to start tasks on time  “student syndrome”.
Goldratt’s solution to managing safety time within projects is to remove safety
time from tasks and allocate a project completion buffer instead.

Buffer management: project managers need to analyze how much of the

project buffer has been used up, compared with how much work remains on
the path feeding it.

Continuous improvement:
Performance improvement is an ongoing effort in an organization to find new
and better way of doing things.
The goal of performance improvement:
* improve productivity
* gain and maintain competitive advantage
* optimize resources
* increase profit or shareholder value
* deliver high quality, sustainable, products and services
* meet customer expectations and demands
The performance improvement process is most likely to achieve its goals when:
* MANAGERS AND STAFF FROM THE ORGANIZATION ACTIVELY PARTICIPATE IN
ALL STAGES OF THE PROCESS IMPROVEMENT EFFORT AND CHANGE PROCESS
* PERFORMANCE IMPROVEMENT MANAGERS IDENTIFY AND BUILD ON
EXISTING PERFORMANCE STANDARDS AND SUCCESSES AS WELL AS ADDRESS
PERFORMANCE PROBLEMS

Performance measurement:
* BPI (Business Process Improvement)
* BPR (Business Process Reengineering)
* KM (Knowledge Management)

Article 9 – PROJECT MANAGEMENT: COST, TIME AND QUALITY – Atkinson

The Iron Triangle – time, cost & quality are not enough as success criteria. It
excludes longer term benefits. Customers and users are examples of
stakeholders, and the criteria they consider as success should also be included
in assessing of a project.
What more needs to be considered?
* System quality
* Information quality
* Information use
* Users satisfaction
* Individual impact
* Organizational impact

THE SQUARE ROUTE – considering four aspects:

* The Iron Triangle
- cost
-quality
-time
* The information system
- maintainability
- reliability
- validity
- information quality use
* Benefits (organization)
- improved efficiency
- improved effectiveness
- increased profits
- strategic goals
- organizational-learning
* Benefits (stakeholder community)
- satisfied users
- social and environmental impact
- personal development
- professional learning

Article 10 – HARVESTING PROJECT KNOWLEDGE – Schindler & Eppler

Projects are suitable for learning. Experiences – which are bound to the people
who are personally involved in the project – are often not a part of a project’s
documentation. Project team members, after having completed their project
tasks, often take their new experiences with them.
The risk for knowledge loss at the end of a project is a serious problem.
Organizations could save considerable costs by correcting these flaws.

Lessons learned are defined as key project experiences which have certain
general business relevance for future projects.

The reason for project amnesia (not documenting lessons learned) are:
* Time
* Motivation
* Discipline
* Skills

There should occur CONTINOUS PROJECT LEARNING through regular review

(not only at the end of the project, it should occur constantly).