Chapter 4:

Project Integration Management

Ir. Munawar, MMSI,. M.Com

[email protected]
 Learning Objectives
ƒ Describe an overall framework for project integration
management as it relates to the other project
management knowledge areas and the project life
cycle.
ƒ Explain the strategic planning process and apply
different project selection methods.
ƒ Explain the importance of creating a project charter
to formally initiate projects.
ƒ Discuss the process of creating a preliminary project
scope statement.

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 Learning Objectives
ƒ Describe project management plan development,
including content, using guidelines and templates for
developing plans, and performing a stakeholder
analysis to help manage relationships.
ƒ Explain project execution, its relationship to project
planning, the factors related to successful results, and
tools and techniques to assist in project execution.
ƒ Describe the process of monitoring and controlling
project work.

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 Learning Objectives
ƒ Understand the integrated change control process,
planning for and managing changes on information
technology projects, and developing and using a
change control system.

ƒ Explain the importance of developing and following

good procedures for closing projects.

ƒ Describe how software can assist in project

integration management.

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 What is Project Integration
Management?
ƒ Project integration management involves coordinating
all the other project management knowledge areas
throughout a project’s life cycle.
ƒ Integration ensures that all the elements of a project
come together at the right times to complete a project
successfully.

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 Project Integration Management
Processes
ƒ Develop the project charter: Work with stakeholders to
create the document that formally authorizes a project—
the charter.
ƒ Develop the preliminary project scope statement:
Work with stakeholders, especially users of the project’s
products, services, or results, to develop the high-level
scope requirements and create a preliminary project scope
statement.
ƒ Develop the project management plan: Coordinate all
planning efforts to create a consistent, coherent
document—the project management plan.

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 Project Integration Management
Processes (cont’d)
ƒ Direct and manage project execution: Carry out the
project management plan by performing the activities
included in it.
ƒ Monitor and control the project work: Oversee project
work to meet the performance objectives of the project.
ƒ Perform integrated change control: Coordinate
changes that affect the project’s deliverables and
organizational process assets.
ƒ Close the project: Finalize all project activities to
formally close the project.

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The Key to Overall Project Success: Good
Project Integration Management
ƒ Coordinating all of the people, plans, and work
required to complete a project
ƒ Focus on the big picture of the project and steer the
project team toward successful completion
ƒ Make final decision when there are conflicts among
project goals or people involved
ƒ Communicate key project information to top
management

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 Interface Management
ƒ Interface management involves identifying and
managing the points of interaction b/w various
elements of the project.
ƒ The number of interfaces can increase exponentially as
the number of people involved in the project increase.
ƒ The most important jobs of a project manager is to
establish and maintain good communication and
relationships across organizational interfaces

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 Strategic Planning and Project
Selection
ƒ Identifying Potential Projects
ƒ Deciding what projects to do in the first place

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 Strategic Planning and Project
Selection
ƒ Strategic planning involves determining long-term
objectives, predicting future trends, and projecting
the need for new products and services.
ƒ Organizations often perform a SWOT analysis:
ƒ Strengths, Weaknesses, Opportunities, and Threats

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 Methods for Selecting Projects
ƒ There is usually not enough time or resources to
implement all projects.
ƒ Methods for selecting projects include:
ƒ Focusing on broad organizational needs.
ƒ Categorizing information technology projects.
ƒ Performing net present value or other financial
analyses.
ƒ Using a weighted scoring model.
ƒ Implementing a balanced scorecard.

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 Focusing on Broad
Organizational Needs
ƒ It is often difficult to provide strong justification for
many IT projects, but everyone agrees they have a high
value.
ƒ “It is better to measure gold roughly than to count
pennies precisely.”
ƒ Three important criteria for projects:
ƒ There is a need for the project.
ƒ There are funds available for the project.
ƒ There is a strong will to make the project succeed.

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 Categorizing IT Projects
ƒ One categorization assesses whether the project
provides a response to:
ƒ A problem
ƒ An opportunity
ƒ A directive
ƒ Another categorization is based on the time it will take
to complete a project or the date by which it must be
done.
ƒ Another categorization is the overall priority of the
project.

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 Financial Analysis of Projects
ƒ Financial considerations are often an important
aspect of the project selection process.

ƒ Three primary methods for determining the

projected financial value of projects:

ƒ Net present value (NPV) analysis

ƒ Return on investment (ROI)

ƒ Payback analysis

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 Net Present Value Analysis
ƒ Net present value (NPV) analysis is a method of
calculating the expected net monetary gain or loss from
a project by discounting all expected future cash inflows
and outflows to the present point in time.

ƒ Projects with a positive NPV should be considered if

financial value is a key criterion.

ƒ The higher the NPV, the better.

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 Figure 4-2. Net Present Value
Example

Note that
totals are
equal, but
NPVs are
not
because of
the time
value of
money.

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 Figure 4-3. JWD Consulting NPV
Example
Multiply
by the
discount
factor each
year, then
subtract costs
from
cumulative
benefits to
get NPV.

Note: See the template called business_case_financials.xls.

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 NPV Calculations
ƒ Determine estimated costs and benefits for the life of
the project and the products it produces.

ƒ Determine the discount rate (check with your

organization on what to use).

ƒ Calculate the NPV (see text for details).

ƒ Some organizations consider the investment year as

year 0, while others consider it year 1. Some people
enter costs as negative numbers, while others do not.
Make sure to identify your organization’s preferences.
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 Return on Investment
ƒ Return on investment (ROI) is calculated by
subtracting the project costs from the benefits and then
dividing by the costs.
ROI = (total discounted benefits - total discounted costs)
/ discounted costs
ƒ The higher the ROI, the better.
ƒ Many organizations have a required rate of return or
minimum acceptable rate of return on investment for
projects.
ƒ Internal rate of return (IRR) can by calculated by
setting the NPV to zero.
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 Payback Analysis
ƒ Another important financial consideration is
payback analysis.
ƒ The payback period is the amount of time it will
take to recoup, in the form of net cash inflows, the
total dollars invested in a project.
ƒ Payback occurs when the cumulative discounted
benefits and costs are greater than zero.
ƒ Many organizations want IT projects to have a fairly
short payback period.

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 Figure 4-4. Charting the Payback
Period

Excel file

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 Weighted Scoring Model
ƒ A weighted scoring model is a tool that provides a
systematic process for selecting projects based on many
criteria.
ƒ Steps in identifying a weighted scoring model:
1. Identify criteria important to the project selection
process.
2. Assign weights (percentages) to each criterion so they
add up to 100 percent.
3. Assign scores to each criterion for each project.
4. Multiply the scores by the weights to get the total
weighted scores.
ƒ The higher the weighted score, the better.
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 Figure 4-5. Sample Weighted Scoring
Model for Project Selection

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 Implementing a Balanced
Scorecard
ƒ Drs. Robert Kaplan and David Norton developed this
approach to help select and manage projects that align
with business strategy.

ƒ A balanced scorecard is a methodology that converts

an organization’s value drivers, such as customer
service, innovation, operational efficiency, and
financial performance, to a series of defined metrics.

ƒ See www.balancedscorecard.org for more information.

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 Project Charters
ƒ After deciding what project to work on, it is
important to let the rest of the organization know.
ƒ A project charter is a document that formally
recognizes the existence of a project and provides
direction on the project’s objectives and
management.
ƒ Key project stakeholders should sign a project
charter to acknowledge agreement on the need and
intent of the project; a signed charter is a key output
of project integration management.

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 Input for Developing a Project
Charter
ƒ A contract: includes much of the information needed
for creating a good project charter
ƒ Statement of work: describe business need for the
project, summary of the requirements and
characteristics of the products or services, and
organizational information
ƒ Enterprise environmental factors: organization’s
structure, culture, infrastructure, human resources,
personnel policies, marketplace conditions, stakeholder
risk tolerances, industry risk information

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 Input for Developing a Project
Charter
ƒ Organizational process assets information: formal and
informal plan, policies, procedures, guidelines,
information systems, financial systems, management
systems, lessons learned, and historical information

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 Project Charters
ƒ The project’s title and date of authorization
ƒ The project manager’s name and contact information
ƒ A summary schedule, including the planned start and finish
dates
ƒ A summary of the project’s budget or reference to budgetary
documents
ƒ A brief description of the project objectives, including the
business need or other justification for authorizing the project
ƒ A roles and responsibilities matrix
ƒ A sign-off section for signatures of key project stakeholders
ƒ A comments section in which stakeholders can provide
important comments related to the project

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 Project Charters

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 Project Charters

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 Project Charters

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 Figure 4-6. Project Integration
Management Overview

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 Preliminary
Scope Statements
ƒ A scope statement is a document used to develop and
confirm a common understanding of the project scope.

ƒ It is an important tool for preventing scope creep:

ƒ The tendency for project scope to keep getting bigger.

ƒ A good practice is to develop a preliminary or initial

scope statement during project initiation and a more
detailed scope statement as the project progresses.

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 Scope Statement (Draft Version)

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 Scope Statement (Draft Version)
(continued)

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 Project Management Plans
ƒ A project management plan is a document used to
coordinate all project planning documents and help
guide a project’s execution and control.

ƒ Plans created in the other knowledge areas are

subsidiary parts of the overall project management
plan.

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 Attributes of Project Plans
ƒ Just as projects are unique, so are project plans.
ƒ Plans should be:
ƒ Dynamic
ƒ Flexible
ƒ Updated as changes occur
ƒ Plans should first and foremost guide project execution
by helping the project manager lead the project team
and assess project status.

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 Common Elements of a Project
Management Plan
ƒ Introduction or overview of the project.

ƒ Description of how the project is organized.

ƒ Management and technical processes used on the

project.

ƒ Work to be done, schedule, and budget information.

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 Introduction of the Project
ƒ The project name
ƒ A brief description of the project and the need it
addresses
ƒ The sponsor’s name
ƒ The names of the project manager and key team
members
ƒ Deliverables of the project
ƒ A list of important reference materials
ƒ A list of definition and acronyms

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 Description of How the Project is
Organized
ƒ Organizational charts
ƒ Project responsibilities
ƒ Other organizational or process-related information

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 Management and Technical
Processes Used on the Project
ƒ Management objectives
ƒ Project controls
ƒ Risk management
ƒ Project staffing
ƒ Technical process

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 Work to be Done
ƒ Major work packages
ƒ Key deliverables
ƒ Other work-related information

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 Project Schedule
ƒ Summary schedule
ƒ Detailed schedule
ƒ Other schedule-related information

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 Budget
ƒ Summary budget
ƒ Detailed budget
ƒ Other budget-related information

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Table 4-1. Sample Contents for a Software
Project Management Plan (SPMP)

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 What the Winners Do
“The winners clearly spell out what needs to be done in a project, by
whom, when, and how. For this they use an integrated toolbox,
including PM tools, methods, and techniques…If a scheduling
template is developed and used over and over, it becomes a
repeatable action that leads to higher productivity and lower
uncertainty. Sure, using scheduling templates is neither a
breakthrough nor a feat. But laggards exhibited almost no use of the
templates. Rather, in constructing schedules their project managers
started with a clean sheet, a clear waste of time.”*

*Milosevic, Dragan and And Ozbay, “Delivering Projects: What the Winners Do,”
Proceedings of the Project Management Institute Annual Seminars & Symposium
(November 2001).
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 Stakeholder Analysis
ƒ A stakeholder analysis documents important (often
sensitive) information about stakeholders such as:
ƒ Stakeholders’ names and organizations.
ƒ Their roles on the project.
ƒ Unique facts about each stakeholder.
ƒ Their level of influence on and interest in the project.
ƒ Suggestions for managing relationships with each
stakeholder.

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 Table 4-2. Sample Stakeholder
Analysis

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 Project Execution
ƒ Project execution involves managing and performing
the work described in the project management plan.

ƒ The majority of time and money is usually spent on

execution.

ƒ The application area of the project directly affects

project execution because the products of the project
are produced during project execution.

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 Project Execution
ƒ The project manager need to focus on leading the
project team and managing stakeholder relationships to
execute the project management plan successfully.
ƒ Project human resource management and project
communications management are crucial.

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 Coordinating Planning and
Execution
ƒ Project planning and execution are intertwined and
inseparable activities.

ƒ Those who will do the work should help to plan the

work.

ƒ Project managers must solicit input from the team to

develop realistic plans.

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 Leadership and a Supportive
Culture
ƒ Project managers must lead by example to demonstrate
the importance of creating and then following good
project plans.
ƒ Organizational culture can help project execution by:
ƒ Providing guidelines and templates.
ƒ Tracking performance based on plans.
ƒ Project managers may still need to break the rules to
meet project goals, and senior managers must support
those actions.

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 Important Skills for Project
Execution
ƒ General management skills such as leadership,
communication, and political skills.

ƒ Product, business, and application area skills and

knowledge.

ƒ Use of specialized tools and techniques.

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 Project Execution Tools and
Techniques
ƒ Project management methodology: Many experienced
project managers believe the most effective way to improve
project management is to follow a methodology that describes
not only what to do in managing a project, but how to do it.
ƒ Project management information systems: Hundreds of
project management software products are available on the
market today, and many organizations are moving toward
powerful enterprise project management systems that are
accessible via the Internet.
ƒ See the “What Went Right?” example of Kuala Lumpur’s
Integrated Transport Information System.

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 Monitoring and Controlling
Project Work
ƒ Changes are inevitable on most projects, so it’s
important to develop and follow a process to monitor
and control changes.

ƒ Monitoring project work includes collecting,

measuring, and disseminating performance
information.

ƒ Two important outputs of monitoring and controlling

project work include recommended corrective and
preventive actions.
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 Integrated Change Control
ƒ Three main objectives are:

ƒ Influence the factors that create changes to ensure that

changes are beneficial.

ƒ Determine that a change has occurred.

ƒ Manage actual changes as they occur.

ƒ A baseline is the approved project management plan

plus approved changes.

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 Change Control System
ƒ A formal, documented process that describes when and
how official project documents and work may be
changed.

ƒ Describes who is authorized to make changes and how

to make them.

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 Change Control Boards (CCBs)
ƒ A formal group of people responsible for approving or
rejecting changes on a project.

ƒ CCBs provide guidelines for preparing change

requests, evaluate change requests, and manage the
implementation of approved changes.

ƒ CCBs include stakeholders from the entire

organization.

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 Making Timely Changes
ƒ Some CCBs only meet occasionally, so it may take too
long for changes to occur.
ƒ Some organizations have policies in place for time-
sensitive changes.
ƒ A “48-hour policy” allows project team members to
make a decision and have 48 hours to seek approval
from top management. If the team decision cannot be
implemented, management has 48 hours to reverse a
decision; otherwise, the team’s decision is approved.
ƒ Another policy is to delegate changes to the lowest level
possible, but keep everyone informed of changes.

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 Configuration Management
ƒ Ensures that the descriptions of the project’s products
are correct and complete.
ƒ Involves identifying and controlling the functional
and physical design characteristics of products and
their support documentation.
ƒ Configuration management specialists identify and
document configuration requirements, control
changes, record and report changes, and audit the
products to verify conformance to requirements.

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Software Configuration Management
(SCM)

The “First Law”

No matter where you are in the system
life cycle, the system will change, and the
desire to change it will persist throughout
the life cycle.
Bersoff, et al, 1980

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 What Are These Changes?

changes in
business requirements
changes in
technical requirements
changes in
user requirements other
documents

software models
Project
Plan data
Test
code

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 What is SCM
ƒ SCM is a set of tracking and control activities that
begin with a software project begins and terminate only
when the software is taken out of operation
ƒ The purpose of SCM is to maintain the integrity of
products as the evolve from specifications through
design, development, and production

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 The Software Configuration

programs documents

The pieces data

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Software Configuration Item (SCI)
• System Specification
• Software Project Plan
• Software Requirements Specification
• Preliminary User Manual
• Design Specification
• Source Code Listing
• Test Specification
• Operation and Installation Manuals
• Executable Program
• Database Description

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 Software Configuration Item

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 Change & SCM

Software Engineering SCM

tools • identification
methods • version control
• change control
procedures • auditing
• reporting
a TQM foundation • construction

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 Component Identification
ƒ 714F-RTC-SRS-B
ƒ 714-MTEP-A
ƒ where
ƒ 714 -- project
ƒ RTC -- Real Time Control
ƒ SRS -- Software Requirement Specification
ƒ MTEP -- Master Test and Evaluation Plan
ƒ A -- revision

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 Version Control
ƒ RTC_101.FOR.5
ƒ where
ƒ 101 = input / output
ƒ FOR = Fortran language
ƒ 5 = version

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 Change Control

STOP

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 Change Control Process—I

need for change is recognized

change request from user

developer evaluates
change report is generated
change control authority decides

request is queued for action

change request is denied
user is informed
change control process—II
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 Change Control Process-II
assign people to SCIs

check-out SCIs

make the change

review/audit the change

establish a “baseline” for testing

change control process—III

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 Change Control Process-III

perform SQA and testing activities

check-in the changed SCIs

promote SCI for inclusion in next release

rebuild appropriate version

review/audit the change

include all changes in release

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 Auditing

Change
Requests SQA
Plan
SCIs

SCM Audit

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 Access Control

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 Status Accounting

Change
Change
Reports ECOs
Requests
SCIs

Status Accounting

Reporting
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Table 4-3. Suggestions for Managing
Integrated Change Control
ƒ View project management as a process of constant
communication and negotiation.
ƒ Plan for change.
ƒ Establish a formal change control system, including a
change control board (CCB).
ƒ Use good configuration management.
ƒ Define procedures for making timely decisions on smaller
changes.
ƒ Use written and oral performance reports to help identify
and manage change.
ƒ Use project management and other software to help manage
and communicate changes.
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 Closing Projects
ƒ To close a project, you must finalize all activities and
transfer the completed or cancelled work to the
appropriate people.
ƒ Main outputs include:
ƒ Administrative closure procedures.
ƒ Contract closure procedures.
ƒ Final products, services, or results.
ƒ Organizational process asset updates.

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Using Software to Assist in Project
Integration Management
ƒ Several types of software can be used to assist in
project integration management:
ƒ Word processing software creates documents.
ƒ Presentation software creates presentations.
ƒ Spreadsheets or databases perform tracking.
ƒ Communication software such as e-mail and Web
authoring tools facilitate communications.
ƒ Project management software can pull everything
together and show detailed and summarized information.
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 Chapter Summary
ƒ Project integration management includes:
ƒ Developing a project charter.
ƒ Developing a preliminary project scope statement.
ƒ Developing a project management plan.
ƒ Directing and managing project execution.
ƒ Monitoring and controlling project work.
ƒ Performing integrated change control.
ƒ Closing the project.

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