Project Management Fundamentals Seminar

Project Management Seminar
Mark Roman, B.Math, M.B.A., P.M.P.
Chief Information Officer
University of Victoria

2
Agenda
Summary
Project Governance
Project Management Knowledge areas:
 Scope
 Schedule
 Estimating
 Cost
 Documentation
 Quality
 Resources
 Communications
 Risk
 Procurement
Project Management Methodology
Project Management Fundamentals
Introductions

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Introductions
 Who are you?
 Favourite project
 Worst project
 Expectations from the seminar
 Preferred focus

Project Management Fundamentals
 What is a project?
 What is project management?
 Why manage projects?
 Where do projects come from?
 Project process model
 How to improve the project management process
 Project management knowledge areas

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What is a Project?
 A project is a temporary endeavor undertaken to create a unique product or service
• Temporary = Definite beginning & end
• Unique = product or service is different in some way from existing products or service
 A means to respond to requests that cannot be addressed through an organization’s normal
operational limits
 A funded ephemeral event that delivers value
 The way work gets done in a growing number of companies including ABB, Hewlett-
Packard, US West, Motorola, etc.
 Building blocks in the design and execution of an organization’s strategies

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What is Project Management?
 Project management is the application of knowledge, skills, tools, and techniques to project
activities to meet project requirements
 Managing the work of projects:
 Competing demands for:
 Scope
 Time
 Cost
 Risk
 Quality
 Stakeholders with different needs and expectations
 Project management is a process
 When you have a standard process, you can continuously improve it

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Why Project Management?
 Imagine running your institution without financial accounting management …
 No documented processes
 No understanding of processes
 No common language
 No standards
 No data collection or reporting
 No knowledge management
 No educational requirements
… no success
 Running projects without project management leads to the same result

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Why Project Management?
 PM Solutions, “Value of Project Management Survey,”
Value of Project Management
66%
32%
53%
79%
58%
37%
55%
0% 20% 40% 60% 80% 100%
Profitability
Time to market
Alignment to business strategy
Meeting delivery dates & budgets
Product quality
Resource productivity
Customer satisfaction

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Where do Projects Come From?
Processes Projects
Organizations only do two things …
Ongoing day-to-day
operational work.
Activities with a fixed
start and finish.
… organizations use projects to execute change.

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Project Process Model
Initiation Defining objectives, and authorizing and funding the project
Planning Defining course of action to achieve the objectives
Executing Coordinating resources to carry-out the plan
Controlling Monitoring progress and acting on variances
Closing Formalizing acceptance and bring it to an end

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Project Process Activity Levels
 Processes overlap
 Not discrete
 Variations in activity level over time
 All project managers do these processes – knowingly or not. They may do them well or they may
do them wretchedly, but they always do them.

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Project Management Maturity Model
Time
Maturity
Level 1: Initial
Level 2: Repeatable
Level 3: Defined
Level 4: Managed
Level 5: Optimized
• PM awareness but no effective usage
• Ad hoc and chaotic PM process
• Success requires heroes
• Simple PM processes established to
track cost, schedule, & functionality
• Process discipline in place to repeat
earlier success
• Project management process
documented, standardized, & integrated
• All projects use a standard process for
project management
• Detailed measures of process and
quality collected
• Project management process
quantitatively understood and controlled
• Continuous process improvement based
on quantitative feedback
• Piloting innovation
• Integration with institutional systems

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Processes, Standards, & Methodologies
Other
Methodologies
Product
Development
Lifecycle
Methodology
Business
Process
Analysis
Methodology
Systems
Development
Methodology
Templates
Lessons Learned
Best Practices
Process Models
Standardization
Quality Audits
Benchmarking
Industry guides

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Project Characteristics by Organisation
Organisation Type
Functional Weak Matrix Balanced Strong Matrix Projectized
Project
Character
Project Manager’s
Authority
Minimal Limited Moderate High Total
Full Time Staff
Assigned to
Projects
None 25% 50% 75% 100%
Project Manager’s
Role
Part time Part time Full time Full time Full time
Common Project
Manager Labels
Project
Coordinator
Project
Leader
Project
Manager
Project
Manager /
Program
Manager
Project
Manager /
Program
Manager
PM Admin Staff Part time Part time Part time Full time Full time

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Key Roles in Projects
Executive
Sponsor
• Enterprise-wide influence
• Spearheads systemic organization change
• Owns the results of strategy
Steering
Committee
• Funding decisions
• Selects, prioritizes, & evaluates the corporate project portfolio
• Escalation for strategic project issues
• Responsible to ensure promised benefits are realised
PMO
Director
• Pan-organizational project oversight
• Corporate-wide resource allocation
• Ensures project management processes are executed consistently
• Process owner and resource manager
Project
Manager
• Individual project management
• Execute projects that are closely coupled with corporate & departmental goals
• Manages the day-to-day tasks necessary to move the project through all its phases
Project
Team
• Executing the day-to-day tasks necessary to move the project through all its phases
• “Help the crowd stand out, rather than stand out in a crowd”
• Focus on the project customer
• Transcend functional specialty and silos

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Project management knowledge areas
Scope What are we going to do?
Time When is it going to get done?
Cost How much is it worth to the sponsor?
Quality Did we do what we said we would do?
Human Resources Who is going to do it?
Communications What do we say to who at what time?
Risk What can we do to avoid failure?
Procurement How do we work with outsiders?
Integration How will we work together?

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The Art & Science of Project Management
 The art of project management
 Leadership
 Negotiation
 Motivation
 Team-building
 Facilitation
 Innovation
 The science of project management
 Planning
 Scheduling
 Cost control
 Administration
 Detailed technical tasks

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Breakout 1: Identify Potential Projects
 What are some good ideas for projects?
 Brainstorm potential projects
 Reasonable
 Do-able
 Valuable

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Ownership of Projects
 Who owns the project?
 Project manager?
 Users?
 Project staff?
 Sponsors?
 The secret to great project management is to never own the project
 As a project manager, you are the conduit through which the dreams of your sponsor(s) and
stakeholders flow

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 Should all organizations manage projects the same way?
 Can project management be applied to aerospace, pharmaceuticals, and marketing the same
way?
 Value in consistently applying same principles, as long as those principles make sense

Control
Mechanisms
Steering
Committee
Role
Project
Flow
Portfolio assessment
• Priorities
• Risk
• Strategic fit
Status reporting
Fiscal budget
Risk plan
Scope
Resource plan
Schedule
Quality plan
Communication plan
Vendor management
Base budget
Support resources
Benefit measures
Project Life Cycle
Initiation Planning Execution Closure Asset Maintenance
Reject
Approval
Not Needed
Review
Charter
Cancel
Not Successful
Monitor
Status
Approval
Continue
Execution
Not Accepted
Accepted
Review
Deliverable
Reject
Not Sufficient
Review
Plan
Approval
Plan
Project
Document
Implement
Plan
Revisions
Progress
Shutdown
Project
Final Product
Maintain
Asset
Initiate
Next Phase
New Project
Work
Support Work
Benefit
Realization
Issue log
Change control
Develop
Project
Charter
Document
Needs

Project Charters
 Why write a project charter?
 Content (template)
 Evaluation criteria
 Steering committee process

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Why Write a Project Charter?
 Project charter is required for new projects
 Purpose of project charter
 Business case to justify the project
 Document project parameters
 Guide project development
 Acquire formal authorization to proceed to the next step in the project
 Authorize the use of resources to develop detailed project plan
 Sufficient information to help the steering committee make their decision
 Standard template
 Generally brief: 3 to 5 pages

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Contents of a Project Charter
 Purpose of project
 Benefits
 Project owners
 In scope
 Out of scope
 Constraints
 Assumptions
 Options
 Resourcing
 Milestones
 Work breakdown structure
 Person days needs
 Users
 Risks
 Costs

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Project Charter Evaluation Criteria
New
Project
Undergrad Studies
Strategy: Enhance the student university experience
Positive
transition
from high
school to
university
Establish
first year
coordinator
in SASC
Hurdle1:
Doestheprojectmeettheuniversity’sgoals?
Criteria Description Yes/No
Expenses
Lower the cost to operate
the university.
Velocity
Deliver products & services
faster
Capacity
Handle more work with
same resources
Satisfaction
Improve customer service
and satisfaction
NPV
Positive net present value
of costs & benefits
Decisioning Improves ability to make
more collaborative and
timely decisions
Leverage
Maximize use of existing
assets
MarketShare Grow volume profitably
Innovation Increase innovation &
improve learning
processes.
Passed
Project
Hurdle2:
Howwelldoestheprojectmeettheuniversity’sgoals?
Risk
Lower risks of running the
university
Mandated Non-negotiable operational
requirement or legislative
demand.
Appoint first
year
coordinator
in FASS
Implement
academic
advising
plan
Integrate
Campus
Life &
Career
Services
into SASC
Increase
co-ops and
placements
Strategy: Continually improve the quality of the student body
Set
appropriate
enrolment
targets in
programs &
faculties
Raise high
school
entrance
averages
relative to
province
Increase
proportion
of high
achieving
students
Set
appropriate
targets for
internation-
al students
Review
articulation
agreements
Strategy: Improve retention and graduation rates
Grad Studies
Strategy: Enhance university’s activity & profile in grad studies & research
Increase
student
volume &
improve
student
quality
Use grad
funding to
improve
student
quality
Grow
external
funds for
research,
infrastruct-
ure, awards
Define
strategic
research
areas
Assist in
develop-
ment of
student
recruitment
plans
Grow
circulation
& use of
research
results
Grow
internation-
al character
of research
work &
partners
Support for Teaching and Learning
Strategy: Strengthen teaching & learning support
Grow EDC:
orientation
and
instruction
in
pedagogy
Improve
Library:
access to
info and
resources
Reward
achieve-
ment in
instruction,
pedagogic-
al research
Emphasize
teaching
achieve-
ments for
tenure/
promos
Faculty and Staff
Strategy: Recruit and retain highest quality staff
Congenial,
supportive,
equitable
work
environ-
ment
Multi-year
schedule
for hiring
faculty and
staff
Promote
collabora-
tion with
employee
groups
Advancement
Strategy: Strengthen university’s position regionally, nationally, and internationally
Develop
integrated
plan for all
Advance-
ment units
Develop
diverse and
equitable
institutional
image
Community
Strategy: Foster identification & attachment to Carleton
Promote
community
of learning
Develop
university-
wide events
Promote
diversity
and civility
Develop
university
organized
culture
events on
campus
Infrastructure and Financial Management
Strategy: Improve the physical plant and campus infrastructure
Refine and
develop
Campus
Master
Plan
Improve
physical
appearance
&
cleanliness
of campus
Create
comfortable
spaces
Continue
install and
upgrade of
campus
network
Address
deferred
mainten-
ance
backlog
Continue to
implement
new admin
system
Strategy: Maintain financial viability of the university
Improve
and modify
global
budgeting
system
Reduce
accumulat-
ed deficit
Maximize
external
funding of
projects
9/22/2003Generic model Banner Steering Committee
Project Evaluation Criteria
Continue
university
retention
committee
Monitor
impact of
new rules
on retention
& update
Implement
clear &
uniformly
applicable
rules
Correct
courses
with high
no-credit
rates
Support
mission of
CIE
 Two project hurdles:
 Does the project meet any of the institution’s strategic goals?
 If yes, how well does it meet those goals?

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Steering Committee Project Charter Review
 Submitted a few days before meeting to all members
 Author(s) attend meeting to answer questions (not present contents)
 Steering committee will decide one of the following:
Approval to plan: Approval to spend the resources necessary to develop a detailed project
plan (large, complex projects)
Approval to execute: Approval to proceed with project execution (small, inexpensive, quick
projects)
Approval in principle: Approval in principle to proceed with the project subject to certain
conditions. These conditions require follow-up with the steering
committee before proceeding with project plan development or project
execution.
On hold: Approval in principle with the project concept, but further work is put on
hold until certain conditions are met. No work is to proceed on the
project until steering committee judges needed criteria are met.
Rejection: The project charter does not meet the project evaluation criteria and all
work will halt on the project.

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Change Request or Project?
Submit new
request by
functional
area
Review
request by
project office
Schedule
request by
project office
Start work
by team
Review of
project
charter by
steering
Hold request
Review of
project
charter by
steering
No additional
resources required
Additional resources
required
Low priority and less
than 20 days and low
impact and not complex
High priority, or more
than 20 days, or high
impact, or complex
Resources
available
Resources not
available
Develop
project plan
Cancel
project or
revise
charter
Approval
Rejection
Cancel
project or
revise
charter
Review of
charter by
budget
committee
Develop
project plan
Cancel
project or
revise
charter
Approval
Rejection
Approval
Rejection

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Breakout 2: Write a Project Charter
 Develop a project charter
 Sell your idea
 Justify project
 Convince others
 Steering committee is the other members of
the seminar

29
Project Prioritization
 Linking projects to strategy
 When you have more projects than money and resources, how do you choose?
 Dimensions of the problem:
 Strategic priority
 Return
 Risk
 Fit, utility, and balance

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Project Management & Strategy
Strategy
ProjectManagement
Project A
Project B
Project C
Purpose
Benefit
Initiative 1
Purpose
Benefit
Project F
Project D
Project E
Initiative 2

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Project Portfolio
 Plot risk and priority
Risk
High Medium Low
High • Decommission of CP6 • Internal Summary Reporting
• Automate Portfolio Requirements
• Class Scheduling
• Interface Purchase Requisitions
• Electronic Gradebook
• Interface Library and A/R
• Interface Campus Card with OC
Transpo
Priority
Medium • Fixed Assets and Capital Budgeting
• Investment Management
• Remote Cheque Requisition
• OUAC Upgrades
• Accept Payment for Tuition over the
Web
• Automated Average Calculation for 105
Applicants
• Direct Deposit for Student Refunds
• Enhancing Student Service over the
Web
• Transfer Articulation in DARS
• Automated Equivalency and Load into
DARS
• Document Imaging for FAST Reporting
• Direct Deposit for Travel Expenses
• Document Finance Processes
• Remote Access
• eCommerce (e.g. application fees)
• Remote PO Requisitions
• Intranet for Banner Finance
• Test Environment for Millennium
• Registration Enhancements
• Electronically Import OSAP Data
Low • Automated Travel Expense Claims
• Admissions through Web and
eCommerce
• Receiving EDI Transcripts
• Document Management + Imaging
• Workflow
• Offline Database & Query Facility
• Banner Parking Management
• Archiving Solutions
• Connect Single Sign-on
• User Friendly JV Form
• Force Password Change
• System to Support Paul Menton Centre
• Benchmark Other Institutions
• Link Web Audit to Course Calendar &
Registration
• Banner Web for Alumni Research &
Implement

Project Plans
 What is a project plan?
 Scope planning
 Schedule planning
 Budget planning
 Quality definition
 Resource allocation
 Communications strategy
 Risk management
 Vendor relationship
Fail to plan
and
you plan to fail.

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What is a Project Plan?
 Document used to used to:
 Guide project execution and control
 Document project planning assumptions
 Facilitate communication amongst stakeholders
 Define key management review activities
 Provide a baseline for project measurement and control
 Second stage of approval process for steering committee
 Changes over time as project circumstances dictate
 Scaleable
 Sufficient level of detail for:
 Steering committee to commit resources
 Project manager to run the project

Scope
 All the work required, and only the work required, to complete the project
successfully
 Major project scope management processes:
 Planning: written scope statement
 Definition: dividing deliverables into smaller, manageable components
 Verification: formalizing acceptance of the project scope
 Change Control: managing changes to project scope

35
Scope Planning
 What is a WBS?
 Identifies all the tasks in a project
 Each task is one measurable unit of work
 Once you can schedule, budget, and assign resources for each task in the list, you have
defined the total scope of the project
 Understand the whole project by understanding its parts
 Used to develop and confirm common understanding of project scope
 How do you get there?
 Hierarchical decomposition
 Start at the top level of project deliverables
 Continuously sub-divide deliverables into smaller more manageable components
 Stop when you can assign adequate cost and time estimates
 The definition of adequate changes as the project progresses
 Engage SME’s in the development through facilitated sessions

36
Scope Planning
 Sample work breakdown structure (WBS), U.S. Department of Defense

37
Scope Planning
 Sample work breakdown structure (WBS), software development

38
Scope Planning
 Rules of thumb for adequate level of detail
 8/80 rule
 No task should be less than 8 hours or more than 80 hours (1 to 10 days)
 Reporting period rule
 No task should be longer than the time between 2 status reporting dates
 Smaller is better
 Smaller tasks are more certain, so estimates are more accurate
 Smaller tasks can be assigned to less people, improving accountability
 Smaller tasks are easier to track progress
 Why develop a WBS?
 Detailed understanding of scope of work
 Basis for monitoring progress
 Facilitates accurate cost and schedule estimates
 Clarifies work assignments

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Scope Change Control
 Changes are inevitable
 Requires management process:
 Document every change request
 Description
 Why requested
 Who requested, who will do
 Action taken
 Assess impact of change
 Formally approve/reject
 Communicate cost, time, resource effects
 Track all activity in change log

40
Breakout 3: Develop WBS
 Develop a work breakdown structure for your
project
 Do at least the first three levels
 Is it understandable?
 Can you explain the key work elements to
others?
 Is It useful for dividing the work load across
project team members?

Schedule
 Ensure the project is completed on time
 Major scheduling processes:
 Definition: activities to be performed
 Sequencing: dependencies amongst activities
 Duration: time needed to do activities
 Schedule Development: create the schedule by analyzing activity
sequences, durations, and resource needs
 Schedule Control: managing schedule changes

42
Schedule Planning
 Using tasks from WBS:
 Identify dependencies amongst tasks
 Develop sequence or order of precedence that the tasks must follow
 Mandatory dependencies
 Hard logic that forces a particular series of steps to be followed in order
 Discretionary dependencies
 Preferred logic that suggests a desired series of steps to be followed
 External dependencies
 Relationships between project activities and non-project activities
 Milestones
 Checkpoints where a series of dependent tasks converge and terminate
 As you structure your WBS tasks into a sequence of steps, you will prefer to diagram their
relationships
 Don’t worry about time or resources yet
 Regardless of resources, the tasks must be executed in the same order

43
Schedule Planning
 Four types of scheduling dependencies:
 Finish-to-start
 Initiation of successor depends on completion of predecessor
 Normal sequence of events
 Finish-to-finish
 Completion of successor depends on completion of predecessor
 Sometimes tasks must be co-terminus
 Start-to-start
 Initiation of one task depends on initiation of another task
 Sometimes tasks need to start at the same time
 Start-to-finish
 Completion of one task is dependent on initiation of another task
S F
S F
S F
S F
S F
S F
S F
S F

44
 Arrow Diagramming Method:
Precedence Diagrams
 Activity On Node diagram:

45
Schedule Planning
 Once you have logically sequenced your tasks you can estimate cost and duration of each
task
 For each task develop:
 Schedule estimate:
 The time needed or full duration required to complete the task. For example, it
may take two days to paint the room, but 5 days to decide on the color – so the
duration is 7 days.
 Evaluate human resources available to do the job. If two people are available, and
if the work can be evenly divided, then it would take 1 day to paint the room and
the task duration declines to 6 days.
 Cost estimate:
 Total labour required to complete the task
 Equipment use (crane needed for 4 hours at $x per hour)
 Materials needed by the task (200 bricks needed to build wall)

46
Schedule Planning
 What path gives you have zero flexibility?
 If tasks D, E, and F have no slack time, they are called the critical path
 Critical path is:
 Longest duration path through the network
 Minimum amount of time the project can take
 Becomes managerial focus

47
Schedule Planning
 Precedence diagram and tasks durations work together to build initial schedule
 You know the order of tasks and how long they will take
Start
Task A
2 days
Task B
4 days
Task C
4 days
Task E
12 days
Task D
1 days
Finish

48
Schedule Planning
 Start at the beginning and calculate the earliest start and earliest finish for each task
 The earliest finish date for the whole project is 16 days
ES=1 EF=2
ES=1 EF=4
ES=5 EF=8
ES=5 EF=16
ES=9 EF=9
Start
Task A
2 days
Task B
4 days
Task C
4 days
Task E
12 days
Task D
1 days
Finish

49
 Now you know the earliest possible finish is after 16 days
 Work backwards from is latest possible finish date, calculating latest start and latest finish
dates
Schedule Planning
ES=1 EF=2
ES=1 EF=4
ES=5 EF=8
ES=5 EF=16
ES=9 EF=9
Start
Task A
2 days
Task B
4 days
Task C
4 days
Task E
12 days
Task D
1 days
Finish
LS=10 LF=11 LS=12 LF=15 LS=16 LF=16
LS=1 LF=4 LS=5 LF=16

50
 How much flexibility do you have in each task? Subtracting the earliest start from the latest
start tells you how much “float”, or slack, you have in the schedule
 Task D can start as early as day 9 or as late as day 16
Schedule Planning
ES=1 EF=2
ES=1 EF=4
ES=5 EF=8
ES=5 EF=16
ES=9 EF=9
Start
Task A
2 days
Task B
4 days
Task C
4 days
Task E
12 days
Task D
1 days
Finish
LS=10 LF=11
Float=9
LS=12 LF=15
Float=7
LS=16 LF=16
Float=7
LS=1 LF=4
Float=0
LS=5 LF=16
Float=0

51
Schedule Planning
 Next step is to assign resources
 Adjust the schedule to the reality of limited resources and optimise use of staff
 Adjust the schedule to keep staff busy at a reasonable rate
 Over-allocation:
 Too many concurrent tasks for staff available
 Specialists particularly limited
 Under-allocation
 Too many resources for concurrent tasks to be done
 Re-assignment to other projects with resultant knowledge loss
 Process
 Forecast resources based on initial schedule
 Identify resource peaks: where are resources working more than 40 hours/week
 During peak periods, delay non-critical tasks (ones with float) to periods where there
are valleys
 Not all peaks may be eliminated, so re-evaluate work
 Consider overtime, adding resources, splitting task into smaller parts to spread out
load across staff (add budget)
 Review completion dates (add time)

52
Schedule Planning
 Sample project network diagram

53
Schedule Planning
 Sample Gantt chart
OUAC
HSA
EMAS
Letter generation
Transfer artic.
DARS
Interfaces
e-Visions
ESIS/UAR
UGAFA
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.

54
Schedule Monitoring
 Once the project is started and a baseline is created, you need to focus on where
you are going, not where you’ve been
 An up-to-date project schedule serves as a radar screen for potential problems
 Critical path issues created by missed deadlines
 Resource allocation conflicts created by workload estimation variances from
actuals

55
Schedule Monitoring
 Updated Gantt chart
OUAC
HSA
EMAS
Letter generation
Transfer artic.
DARS
Interfaces
e-Visions
ESIS/UAR
UGAFA
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Feb. 24

56
Breakout 4: Build project schedule
 Build the schedule for your project
 Draw a Gantt chart for your WBS showing:
 Tasks
 Durations
 Dependencies
 Is it reasonable?
 Does it clarify milestones and deadlines?
 Can project team members use it to plan their
work?

58
Project Administration
 Library of all project documents/knowledge
 Web site
 Database
 File directory
 Continual update & access by all team members
 Need a central person to coordinate, prune, and publish
 Key components
 Project charter
 Plan
 Statuses
 Schedule
 Budget
 Risk plan
 Issue log
 Scope documents

69
Closure Process
“While most project management groups are good at capturing lessons learned and
storing them in some way, the step where knowledge management fails is in the transfer
of that knowledge to future projects.”
From research paper presented to International PM Association
Capture
(75%)
Store
(62%)
Retrieve
(55%)
Apply
(25%)

Estimating
 Techniques used to develop approximate plan values

71
Estimating Challenges
 Need to create realistic time & cost estimates
 Every project is unique, so there is no way to build an exact estimation
 New staff = unknown productivity
 New product = unknown activities & complexities
 New technology = learning curve and unpredictable reliability
 At the beginning of a project it is difficult to foresee the volume and degree of changes
 Business cases tend to over-sell the benefits and under-estimate the costs for the sake of
being approved, create reality-expectation gap
 Accurate estimates are most critical at the beginning of the project when mistakes are most
easily corrected, but …
 Accuracy improves over the life of the project as experience grows
Accuracy
Time
Overestimates
Underestimates

72
Estimating Techniques
 Analogous estimating
 Top down, using the actual costs of previous, similar projects from internal lessons
learned databases or commercial databases
 Parametric estimating
 Use a rule of thumb, for example a 2,000 sq.ft. house will cost $200k to build so your
3,000 sq.ft. project home will cost $300k
 Bottom-up estimating
 Develop a separate estimate for each activity and roll them up
 Most effort & most accurate
 Rolling wave (phased gate) estimates
 Detailed estimate for current project phase and rough estimates for future phases
 Expert judgment
 Leverage experience of others who have worked on similar projects
 Vendor bid analysis
 Send out a request for proposal and compare bids (allow for profit margin)
 In all cases, the staff doing the work need to develop the estimate
 Build understanding & commitment

73
Estimating
 During project start-up, there will be pressure to cut estimates
 Once the scope is developed and , schedule and cost are estimated there will be continuous
and inevitable pressure to:
 Increase scope
 Reaction: increase cost and/or schedule
 Shorten schedule
 Reaction: increase cost and/or decrease scope
 Lower cost
 Reaction: decrease scope
 At some point, these constraints will be squeezed to their limits (law of diminishing
marginal returns)
 “The first casualty in war is truth” …
 “The last casualty in projects is quality …”
ScopeTime
Cost
Quality
ScopeTime
Cost

Cost
 Ensure that the project is completed within the approved budget

75
Budget and Cost Management
 Manage projects like a start-up business
 Structured budget into functional accounts
 For example, allowed tracking by sub-projects or by vendors
 Create accounts that are meaningful for tracking purposes
 Regularly develop forecast based
on actual-to-budget variance
trends
 Regular reporting
 Report monthly on actuals
against budget and forecast
 Review financial data
monthly to identify variances
and act if necessary

76
Earned Value Analysis
 Project management has traditional tools for managing schedule (e.g. Gantt charts) and
budget (e.g. spreadsheets)
 How do you relate budget performance to schedule progress?
 Earned Value Analysis attempts to do it
 A little tricky to understand and difficult to communicate to stakeholders
 Uses 3 measures:
 Planned value:
 The part of the approved cost estimate you planned to spend on the scheduled activity during the
period
 What you planned to spend at this point in time
 Actual cost:
 The real costs incurred in accomplishing the scheduled activity during the period
 What you actually spent on the work completed
 Earned value:
 The value of the actual work completed during the period based on estimate from original plan
 What you planned to spend for the work completed

77
Earned Value Analysis
Schedule
Variance
Cost
Variance

78
Breakout 5: Estimate budget
 Create a budget for your project
 Use estimating techniques to predict project costs
 Account for timelines in schedule
 Use meaningful account names
 Identify key project cost elements
 Where is the bulk of funding required?
 Where will you source the funding?

Quality
 Ensure that the project will satisfy the needs it was intended to meet
 Major project quality management processes:
 Quality Planning: identifying quality standards and how to satisfy them
 Quality Assurance: evaluating if project will satisfy quality standards
 Quality Control: monitoring project results for compliance and
eliminating problems

80
Quality Planning
 Quality policy
 Formal definition of quality to the organization and project
 Conformance to requirements: project produces what it said it would produce
 Fitness for use: product or service satisfies real needs
 Prevention over inspection
 Management responsible for providing resources necessary to succeed
 Plan-do-check-act … plan for variances, measure them, and do something about them

81
Quality Planning
 How to develop quality policy
 Product definition: expectation of what the project will produce
 Standards & regulations: industry standards
 Cost/benefit: how much are you willing to spend for a desired level of quality
 Benchmarking: comparison of quality practices
 Experiments: statistical sampling
 Cause & effect diagramming: map out interactions that drive defects

82
Quality Planning
 Quality management plan:
 A system designed to manage project quality
 “the organisational structure, responsibilities, procedures, processes, and resources
needed to implement quality management” ISO 9000

83
Breakout 6: Quality Statement
 Develop a quality statement for your project
 What overarching quality principles do want to apply?
 Do you have a plan for testing?
 How much quality do you want?
 Are there any quality tradeoffs?

Resources
 Make the most effective use of the people involved with the project
 Major processes:
 Organizational Planning: roles, responsibilities, reporting relationships
 Staff Acquisition: getting the human resources needed
 Team Development: developing individual and group competencies to
enhance project performance

85
Human Resources
 Nothing unusual about project
management human resources
 Use standard HR practices
management practices
 Organizational planning
 Staff management plan: when and
how resources will enter and leave project
 Organizational Breakdown
Structure (OBS): which organizational
units are assigned which work packages –
mapping people to the WBS
 Responsibility assignment matrix:
specific roles by project phase
 Collocation is the #1 team building best
practice for projects

86
Staff Enhancement
 Continuous intellectual
capital growth is the only
sustainable competitive
advantage
 Exceptional educational
opportunities (training,
certification)
 Assigning work becomes a
balance between the needs
of the staff and the needs
of the organization
 Continuous feedback
based on immediate
assignment completion
Pool of project staff and SME’s
Resource
Manager
Project
Manager
Project
Manager
Project
Manager
Functional
Partner
Functional
Partner
Functional
Partner
Project
Organization
 Separating the management of work from the
management of people focuses attention on
staffing issues

Communications
 Generation, collection, dissemination, and storage of project information
 Links people, ideas, and information
 Communications Planning: who needs what, when, and how
 Information Distribution: making needed information available
 Performance Reporting: status, progress, and forecasting
 Administrative Closure: information to formalize completion

88
Communications Strategy
 Who needs what information, when will they need it, how will it be given to them, and by
whom
 Review stakeholder’s information needs and develop a plan to satisfy those needs
 Communications plan
 Procedures for collecting, filing, and disseminating project information
 Distribution structure to whom what info will flow (e.g. who gets status reports)
 Description of the information to be distributed: format, context, level of detail, and
conventions
 Timetable for each type of communication
 Methods of access for “pull” information
 Plan for updating the communications plan

89
Project Status Reporting
 Weekly status of project formally documented
 Written report
 Simple focus on progress, issues, and next steps
 Encourage realistic reporting
 Bullet list for quick scanning
 Results
 Awareness creates greater confidence in project
 No surprises
 No secrets
 No silver bullets
 Meeting minutes are not status reports

90
Weekly Management Review
 Project manager reviews accomplishments, issues, and plans
 Forum for:
 Discussing issues
 Creates shared awareness of status of all project activity
 Opportunity to question anything
 Debate on approach to any project activities
 Identify issues requiring escalation to steering committee
 Policy
 Funding
 Diplomatic support

91
Communication Messaging
 Consistent key messaging
 Demonstrate, don’t speculate
 Match expectations with reality
 No “rah-rah” messages
 Its better to say nothing until you have something to show

92
Breakout 7: Staff & Communications Plans
 Develop a resourcing plan for your project
 What skills do you need?
 When do you need them?
 Do you expect any resource acquisition issues?
 Develop a communications plan
 Who are your target audiences?
 What messages do you wish to convey?
 Timing of messages?

Risk
 Events that may happen in the future that could impact project objectives

94
Continuity plans
• Triggers & symptoms
• Escalation process
• Action plans
• Redundancy/fail-over technology
Risk options
• Avoidance
• Transference
• Mitigation
• Acceptance
Business Continuity
Risk assessment
• Probability of occurrence
• Impact of potential loss
• Tolerance
Environmental assessment
• Ice storms and power outages
• Increasingly powerful viruses
• Terror threats

95
Risk Management Process
 Perform risk assessment
 Step 1 - Risk management plan developed
 Step 2 - Risk assessment team assembled
 Step 3 - Risk generation process executed
 Step 4 - Risk list rationalized
 Step 5 - Risks ranked and prioritized
 Step 6 - Response plans written
 Step 7 - Risk review process established and running monthly
 Institutionalize ongoing risk assessment
 Ongoing risk reviews
 Execution of risk response plans if necessary

96
 Step 1 - Risk Management Plan
 Described how you will implement risk management
 Specific contents
 Risk management methodology
 Approach
 Roles
 Timing
 Reporting
 Risk categories
 Risk definitions
 Response planning
 Monitoring & control
Approve
Approach
Brainstorm
Risks
Review
List
Characterize
Risks
Prioritize
Risks
Response
Planning
Monitor &
Control

97
 Step 2 - Risk Assessment Team
 Key project leaders
 Project SME’s
 Risk managers
 Internal auditors
 External risk experts (consultants)

98
 Step 3 - Risk Generation Process
 Hold brainstorming sessions with full team
 Use standard risk categories to generate ideas
 E.g. Technology, Quality, Assumption, Schedule, etc.
 Raw risks generated through these sessions

99
 Step 4 - Rationalized Risk List
 Remove redundant risks
 Some risks are really issues
 Some risks are symptoms of larger problems
 Create summary risk list

100
 Step 5 - Ranked Risks
 Team voting by:
 Impact of the potential loss
 Probability of occurrence
Degree of impact Financial estimate Numerical
value
Low Less than $250,000 1
Medium $250,000 to $1,000,000 4
High $1,000,000 to $3,000,000 16
Very High $3,000,000 and over 32
Degree of
probability
Probability estimate Numerical
value
Low 1– 25% (unlikely) 1
Medium 26–50% (possible) 2
High 51–75% (more likely than not) 3
Very High 75-100% (quite probable) 4

101
 Step 5 - Ranked Risks (Continued)
 Review by steering committee
 Apply common sense to adjust unusual risks
Score Grade
0 – 10 E
10 – 20 D
20 – 30 C
30 – 40 B
40 – 60 A

102
 Step 6 - Response Plans
 Write response plans for each of the risks:
 Name
 Description
 Initiation
 Triggers
 Symptoms
 Options
 Avoidance
 Transference
 Mitigation
 Acceptance
 Action plan
 Secondary risks

103
 Step 7 - Risk Review Process
 Regular review of each risk by project team
 Review of risk list with steering committee
 New risks can be added
 Fully resolved risks can be removed
 Ranking of individual risks may change

104
Breakout 8: Risk Management Plan
 Create a risk management plan your project
 Identify key risks
 Probability of occurrence?
 Degree of impact?

Procurement
 Acquire goods and services from an outside organization
 Procurement Planning: determining what to buy
 Solicitation Planning: documenting requirements and sources
 Solicitation: obtaining quotations, bids, offers, or proposals
 Source Selection: choosing a vendor
 Contract Administration: managing the relationship
 Contract Closeout: completion of the contract

106
Vendor Management
 Outsource anything that is not a core competency
 Some projects are entirely implemented through contracts
 Process:
 Statement of work: clear detailed specification of what you want contractor to do
 Solicitation document:
 Bid or quotation for price based decisions
 Procurement document for proposals
 IFB: Invitation For Bid
 RFP: Request For Proposal
 RFQ: Request For Quotation
 Set evaluation criteria:
 Understanding your requirements
 Full lifecycle costing
 Technical capability
 Financial capability
 Managerial strength

107
Vendor Management
 Process (continued):
 Distribute solicitation document:
 Qualified seller lists
 Bidder conferences: meeting to clarify proposal
 Advertising
 Merx
 Select a contractor:
 Concurrent negotiations with short listed vendors
 Weighting system: quantify evaluation criteria
 Screening system: minimal requirement threshold
 Independent estimates: external cross-check of pricing
 Develop contract
 Implement contract change control system

108
Vendor Relationships
 Pay your bills
 Focused on developing long term relationships
 Today’s negotiation creates setting for the next negotiation
 You have to live with the vendor for the life of the project
 Be honest
 Everything you learned in Kindergarten applies here
 Most projects have multiple vendors
 Some projects exist only to coordinate multiple vendors

Governance
 Decision making and leadership

110
Project Governance
Steering
Committee
Projects exist to
realize the
aspirations of their
stakeholders
Focus
• Sharing information (“Open the kimono”)
• Education of issues (before resolving issues)
• Mutuality-of-interest problem solving
Role
• Approve/request policy
• Authorize funding
• Monitor progress and metrics
• Realize benefits
Mandate
• To govern the selection, development, & implementation of projects
• To continually improve the governance process
• To resolve institution-wide project issues
• To generate strategic change initiatives

111
Leadership
 Most important project manager leadership characteristics (PM Network):
Soft skills
69%
Strategic vision
19%
Technical
knowledge
6%
Industry
experience
6%

112
Leadership
 Typically, project managers have no one reporting to them through traditional hierarchy
 Key leadership levers are:
 Influence
 Reporting level
 Expertise
 Budget control

113
Enterprise Systems Maturity Model
 Implementing: developing, integrating, and installing the system
 Post Go-Live: managing the environment immediately after implementation
 Stabilizing: improving control and management processes
 Leveraging: realizing productivity and other benefits of the system
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging

114
Maturity & Productivity
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
Productivity
Go
Live
Date
Project
Shock
Zone
Project
Benefit
Zone
Productivity
Baseline

115
Maturity & Morale
Time
SystemMaturity
Post Go-Live
Stabilizing
Time
SystemMaturity
Implementing
Post Go-Live
Leveraging
Morale
Reality
Trough
Recognition
Go
Live
Date
Kick
off

116
Maturity & Cost
Cost
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging

117
Maturity & Value
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
StrategicValue

118
Why Are Enterprise Projects Hard to Do?
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging
Time
SystemMaturity
Implementing
Post Go-Live
Stabilizing
Leveraging

Summary
 Thank you
 Course evaluations

120
Transition Planning
 Planning for staff transition back to original departments
 Who goes where and when do they go there?
 Culture shock to go back to your old process/operational job

121
Project Rules (with apologies to Einstein)
 If we knew what it was we were doing, it would not be called a project, would it?
 The most incomprehensible thing about projects is that they are comprehensible.
 Anyone who has never made a mistake on a project has never tried anything new.
 Try not to deliver a successful project but rather try to deliver a valuable project.
 You do not really understand a project issue unless you can explain it to your grandmother.
 Sometimes one pays most for the project solutions one gets for nothing.

122
Recommended Reading
Title Author Comments
Project Management Harold Kerzner Textbook
A Guide to the Project Management Body
of Knowledge
Project Management
Institute
Roadmap
The Fast Forward MBA in Project
Management
Eric Verzuh Easy read
Radical Project Management Rob Thomsett Pragamatic

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