1st 3 Lecs PM Notes

8/12/2019 1st 3 Lecs PM Notes

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Introduction

At any organization there are many activities being executed every day. Most of these activities areorganized into groups of interrelated activities. These groups fall into two categories: projects and

operations. An operation is an ongoing and repetitive set of tasks, whereas a project has a lifecycleabeginning and an end.

Project

A project is a work effort made over a finite period of time with a start and a finish to create a unique

product, service, or result. Because a project has a start and a finish, it is also called a temporary effort orendeavor. In other words, a project is a temporary endeavor taken to create a unique product, service, orresult. So, a project has two defining characteristics: It is temporary, and it creates a unique product. Lets

explore further these two defining concepts: temporary and unique.

Temporary

The temporary nature of projects refers to the fact that each project has a definite beginning and a definiteend. A project can reach its end in one of two possible ways:

The project has met its objectivesthat is, the planned unique product has been created. The project has been terminated before its successful completion for whatever reason. The temporary nature of projects can also apply to two other aspects: The opportunity to market the product that the project will produce is temporary that is, the

product needs to be produced in a limited timeframe; otherwise, it will be too late. A project team is temporarythat is, the project team is disbanded after the project ends, and the

team members may be individually assigned to other projects.

However, remember that the temporary nature of a project does not refer to the product it creates. Theprojects can create lasting products, such as the Taj Mahal, the Eiffel Tower, or the Internet. The seconddefining characteristic of a project is that it must create a unique product.

Unique product

The outcome of a project must be a unique product, service, or result. How do a product, a service, and aresult differ from each other?

Product:This is a tangible, quantifiable artifact that is either the end item or a component of it. The big-screen television set in your living room, the Swiss watch on your wrist, and the wine bottle on your table

are some examples of products.

Service:Actually, when we say a project can create a service, we really mean the capability to perform aservice. For example, a project that creates a website for a bank to offer online banking has created the

capability to offer the online banking service.

Result.This is usually the knowledge-related outcome of a projectfor example, the results of ananalysis performed in a research project.


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The Importance of Project Management

Shortening of the Product Life CycleOne of the most significant driving forces behind the demand for project management is the shortening of

the product life cycle. For example, today in high-tech industries the product life cycle is averaging 1 to 3

years. Only 30 years ago, life cycles of 10 to 15 years were not uncommon. Time to market for new

products with short life cycles has become increasingly important. A common rule of thumb in the world

of high-tech product development is that a six-month project delay can result in a 33 percent loss in

product revenue share. Speed, therefore, becomes a competitive advantage; more and more organizations

are relying on cross-functional project teams to get new products and services to the market as quickly as

possible.

Knowledge Explosion

The growth in new knowledge has increased the complexity of projects because projects encompass the

latest advances. For example, building a road 30 years ago was a somewhat simple process. Today, each

area has increased in complexity, including materials, specifications, codes, aesthetics, equipment, and

required specialists. Similarly, in todays digital, electronic age it is becoming hard to find a new product

that does not contain at least one microchip. Product complexity has increased the need to integrate

divergent technologies. Project management has emerged as an important discipline for achieving this

task.

Triple Bottom Line (planet, people, profit)

The threat of global warming has brought sustainable business practices to the forefront. Businesses can

no longer simply focus on maximizing profit to the detriment of the environment and society. Efforts to

reduce carbon imprint and utilize renewable resources are realized through effective project management.

The impact of this movement towards sustainability can be seen in changes in the objectives and

techniques used to complete projects. See Snapshot from Practice: Dells Children Becomes Worlds FirstGreen Hospital.

Corporate Downsizing

The last decade has seen a dramatic restructuring of organizational life. Downsizing (or rightsizing if you

are still employed) and sticking to core competencies have become necessary for survival for many firms.


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Middle management is a mere skeleton of the past. In todays flatter and leaner organizations, where

change is a constant, project management is replacing middle management as a way of ensuring that

things get done. Corporate downsizing has also led to a change in the way organizations approach

projects. Companies outsource significant segments of project work, and project managers have to

manage not only their own people but also their counterparts in different organizations.

Increased Customer Focus

Increased competition has placed a premium on customer satisfaction. Customers no longer simply settle

for generic products and services. They want customized products and services that cater to their specific

needs. This mandate requires a much closer working relationship between the provider and the receiver.

Account executives and sales representatives are assuming more of a project managers role as theywork

with their organization to satisfy the unique needs and requests of clients. Increased customer attention

has also prompted the development of customized products and services. For example, 10 years ago

buying a set of golf clubs was a relatively simple process: You picked out a set based on price and feel.

Today, there are golf clubs for tall players and short players, clubs for players who tend to slice the ball

and clubs for those who hook the ball, high-tech clubs with the latest metallurgic discovery guaranteed to

add distance, and so forth. Project management is critical both to development of customized products

and services and to sustaining lucrative relationships with customers.


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1st 3 Lecs PM Notes

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