Chapter 3

Project
Management

IS2184: Information Systems Management

Textbook:
Information Technology for Managers
George W. Reynolds
Strayer University
 Learning Objectives

• What is project management, and what are the key

elements of an effective project management
process?
• How can an effective project management process
improve the likelihood of project success?

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 Why Managers Must Understand
Project Management

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 Core Competency

• Task that a firm can do well which provides

customer benefits
• Hard for competitors to imitate
• Leveraged widely to many products and markets

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 Project Management

• Recognized by many organizations as one of the

core competencies
• Viewed by organizations as the ability to manage
projects to:
– Achieve an edge over competitors
– Deliver greater value to shareholders and customers
• Involves spending considerable effort in:
– Identifying potential project managers
– Training and developing the personnel

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 What is a Project?

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 Project

• Temporary endeavor undertaken to create a

unique product, service, or result
– Attempts to achieve specific business objectives
– Subject to certain constraints, such as total cost and
completion date
• Is not repetitive
• Varies in size and levels of complexity

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 Project Variables

• Highly interrelated parameters defining a project

– Project scope
• Definition of tasks to be included and excluded in a
project
• Key determinant of the other project factors
– Cost
• Capital, expenses, and internal cross-charges
associated with the project’s buildings, operation,
maintenance, and support

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 Project Variables
– Time
• Projects needs to be completed by a certain date to
meet business goals or a government mandate
– Quality
• Degree to which the project meets the needs of the
users
• IT-related system project quality is defined in terms of
the system’s functionality, features, system outputs,
performance, reliability, and maintainability

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 Table 3.1 - Typical IT-Related Project
Costs

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 Project Variables
– User expectations
• Stakeholders’ expectations about how the project will
be conducted and how it will affect them
• End users expect to participate in weekly project
status meetings

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 Figure 3.1 - Five Parameters that
Define a Project

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 Figure 3.2 - Revised Project Definition

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 Project Management

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 Project Management

• Application of knowledge, skills, and techniques to

project activities to meet project requirements
• Handled by managers by managing the
expectations of the stakeholders
• Considered an art and a science
• Project stakeholders
– People involved in the project or those affected by its
outcome

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 Project Management Knowledge
Areas

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 Figure 3.3 - Nine Project Management
Knowledge Areas

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 Scope Management

• Defining the work that must be done as part of the

project
• Controlling the work to stay within the scope to
which the team has agreed
• Key activities
– Initiation, scope planning, scope definition, scope
verification, and scope change control
• Functional decomposition: Defines the scope of
an information system by identifying the business
processes it will affect
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 Scope Management

• Process: Set of logically related tasks performed to

achieve a defined outcome
• Formal scope change process should be defined
before the project begins in order to avoid
problems

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 Figure 3.4 - Functional Decomposition
Defining the Scope of a System

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 Time Management

• Involves:
– Defining an achievable completion date
– Developing a workable project schedule
– Ensuring the timely completion of the project
• Efficiency requires:
– Identifying and sequencing the tasks
– Focusing on firm deadlines or task dependencies
– Estimating the amount of resources required
– Estimating the elapsed time to complete each task
– Analyzing all the data to create a project schedule
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 Time Management
– Controlling and managing changes to the project
schedule
• Project schedule: Identifies project activities to be
completed, expected start and end dates, and
resources allocated to each task
• Project milestone: Critical date for completing a
major part of the project

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 Time Management

• Project deadline: Date of completing and

operationalizing a project
• Slack time: Amount of time an activity can be
delayed without delaying the entire project
• Critical path: Consists of all activities that, if
delayed, would delay the entire project
• Project Evaluation and Review Technique
(PERT)
– Creates three time estimates for an activity

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 Time Management

• Gantt chart: Graphical tool used for planning,

monitoring, and coordinating projects
• Work breakdown structure (WBS)
– Outline of the work to be done to complete the
project
– Allows one to look at the project in detail to
recognize all the work that needs to be performed

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 Figure 3.5 - Gantt Chart Depicting the
Start and Finish of Project Tasks

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 Cost Management

• Developing and managing the project budget

• Involves resource planning, cost estimating, cost
budgeting, and cost control
• Separate budget needs to be established for each
type of cost
– Capital, expense, and internal cross-charge
• Use WBS to estimate all costs

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 Figure 3.6 - Development of a WBS Leads
to Creation of a Schedule and Budget

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 Quality Management

• Ensures that the project will meet the needs for

which it was undertaken
• Quality planning: Determining relevant quality
standards for the project and ways to meet them
• Quality assurance: Evaluating the progress of the
project to ensure that identified quality standards
are met
• Quality control: Checking project results to ensure
that they meet identified quality standards

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 Human Resource Management

• Making optimum use of the people involved with

the project
• Includes organizational planning, staff acquisition,
and team development
• Requires a project manager to:
– Build a project team staffed with people with the right
mix of skills and experience
– Train, develop, coach, and motivate the team to
perform effectively on the project

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 Human Resource Management

• Forming-storming-norming-performing model
– Describes how teams develop and evolve
– Forming stage - Team learns about the project,
agrees on basic goals, and begins to work on tasks
– Storming stage - Team recognizes differences of
opinion among the members and allows the ideas to
compete for consideration
– Norming and performing stage - Team is competent,
motivated, and knowledgeable about all aspects of
the project

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 Figure 3.7 - Tuckman’s Forming-
Storming-Norming-Performing Model

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 Human Resource Management

• Project steering team: Consists of senior

managers representing the business and IT
organizations
– Provide guidance and support to the project
– Key members of the team include:
• Project champion
• Project sponsor
• IT manager

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 Communications Management

• Generation, collection, dissemination, and storage

of project information in a timely and effective
manner
• Includes communications planning, information
distribution, performance reporting, and managing
communications

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 Communications Management

• Key stakeholders
– Project steering team
– The team itself
– End users
– Others who may be affected by the project
• Stakeholder analysis matrix
– Identifies the interest of the stakeholders, their
information needs, and important facts

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 Figure 3.8 - Project Steering Team

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 Risk Management

• Identifying, analyzing, and managing project risks

• Project risk: Uncertain event that, if it occurs, has
a positive or a negative effect on a project objective
• Known risks - Identified and analyzed risks
• Unknown risks cannot be managed directly

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 Risk Management

• People who can participate in identifying the risks

– Experienced project managers
– Members of the organization’s risk management
department
• Classify the risk by:
– Probability that it will occur
– Impact on the project if the risk does occur

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 Risk Management

• Requires considering which risks need to be

addressed with risk management plan
• Allows ignoring risks with a low probability of
occurrence and low potential impact
• Risk owner: Responsible for developing a risk
management strategy and monitoring the project

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 Table 3.8 - Risk Management Plan

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 Figure 3.9 - Well linking Projects to
Organizational Goal and Strategy

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 Procurement Management

• Acquiring goods and/or services for the project

from sources outside the performing organization
• Divided into the following processes
– Plan purchase and acquisition
– Plan contracting
– Request seller responses
– Select seller
– Contract administration
– Contract closure

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 Procurement Management

• Make-or-buy decision: Comparing the pros and

cons of in-house production versus outsourcing of
a given product or service
• Contract - Legal agreement that defines the terms
and conditions of the buyer-provider relationship
– Types
• Fixed-price
• Cost-reimbursable
• Time and material

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 Project Integration Management

• Requires the assimilation of all eight other project

management knowledge areas
• Requires the coordination of all appropriate people,
resources, plans, and efforts to complete a project
successfully

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 Project Integration Management

• Comprises of the following project management

processes
– Developing the project charter
– Developing a preliminary project scope statement
– Developing the project management plan
– Directing and managing project execution
– Monitoring and controlling the project work
– Performing integrated change control
– Closing the project successfully

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 Summary

• Five parameters define a project

– Scope, cost, time, quality, and user expectations
• Project management
– Application of knowledge, skills, and techniques to
project activities to meet project requirements
• Project managers must coordinate nine areas of
expertise
• Forming-storming-norming-performing model
describes how teams form and evolve

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 Summary

• Each project should have a project steering team

• Risk management is a process that attempts to
identify, analyze, and manage project risks
• Procurement management involves acquiring
goods and/or services for the project from sources
outside the performing organization
• Project integration management needs the
assimilation of all the project management
knowledge areas

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