MEM 612 Project Management Chapter 1 The World of Project Management.
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Transcript of MEM 612 Project Management Chapter 1 The World of Project Management.
MEM 612 Project Management
Chapter 1
The World of Project Management
MEM 612 Project Management
WHAT IS A PROJECT?
MEM 612 Project Management
Why the emphasis on project management?• Many tasks do not fit neatly into business-
as-usual.
• Need to assign responsibility and authority for achievement of organizational goals.
MEM 612 Project Management
Characteristics of Projects
• Unique
• Specific Deliverable
• Specific Due Date
MEM 612 Project Management
Other Common Characteristics of Projects• Multidisciplinary
• Complex
• Conflict
• Part of Programs
MEM 612 Project Management
PMI Definition
“A temporary endeavor undertaken to create a unique product or service”
Project Management Institute, 2000
MEM 612 Project Management
PROJECT MANAGEMENT VS. GENERAL MANAGEMENT
MEM 612 Project Management
Skill Requirements for Effective Project Management• Conflict Resolution
• Creativity and Flexibility
• Ability to Adjust to Change
• Good Planning
• Negotiation– win-win versus win-lose
MEM 612 Project Management
WHAT IS MANAGED? THE THREE GOALS OF A
PROJECT
MEM 612 Project Management
Figure 1-1: Performance, Cost, and Time Project Targets
MEM 612 Project Management
THE LIFE CYCLES OF PROJECTS
MEM 612 Project Management
Figure 1-2 The Project Life Cycle
MEM 612 Project Management
Figure 1-3 An Alternate Project Life Cycle
MEM 612 Project Management
SELECTING PROJECTS
MEM 612 Project Management
Nonnumeric Selection Methods• The Sacred Cow
• The Operating/Competitive Necessity
• Comparative Benefits
MEM 612 Project Management
Figure 1-4 The Q-Sort Method
MEM 612 Project Management
Numeric Selection Methods
• Financial Assessment Methods– payback period– discounted cash flow
• Scoring Methods– unweighted 0-1 factor method– weighted factor scoring method
MEM 612 Project Management
Payback Period
InflowsCash Net Annual
Investment Fixed Initial
MEM 612 Project Management
Discounted Cash Flow
n
tt
t
k
F
10 )1(
I- (project) NPV
where
I0 = the initial investment
Ft = the net cash flow in period t
k = the required rate of return or hurdle rate
MEM 612 Project Management
The Weighted Scoring Model
n
jjiji wsS
1
where
Si = the total score of the ith project
sij = the score of the ith project on the jth criterion
wj = the weight or importance of the jth criterion
MEM 612 Project Management
Confronting Uncertainty – The Management of Risk
MEM 612 Project Management
What uncertainties are encountered in project management?• Time required to complete a project
• Availability of key resources
• Cost of resources
• Timing of solutions to technological problems
• Actions taken by competitors
MEM 612 Project Management
Can uncertainty surrounding projects ever be eliminated?• No, but it can be managed
MEM 612 Project Management
Risk Analysis
• Estimate probabilities or distributions associated with key parameters
• Develop analytic or simulation model
• Analyze distribution of outcomes generated by model
MEM 612 Project Management
Risk Analysis with Crystal Ball• Assumption Cells
• Distribution Gallery
• Forecast Cells
MEM 612 Project Management
THE PROJECT PORTFOLIO PROCESS
MEM 612 Project Management
The Project Portfolio Process
• Step 1: Establish a Project Council• Step 2: Identify Project Categories and Criteria• Step 3: Collect Project Data• Step 4: Assess Resource Availability• Step 5: Reduce the Project and Criteria Set• Step 6: Prioritize the Projects within Categories• Step 7: Select the Projects to be Funded and
Held in Reserve• Step 8: Implement the Process
MEM 612 Project Management
The Aggregate Project Plan
MEM 612 Project Management
Figure 1-12 An Example Aggregate Project Plan
MEM 612 Project Management
Copyright
Copyright John Wiley & Sons, Inc.
All rights reserved. Reproduction or translation of this work beyond that permitted in Section 117 of the 1976 United States Copyright Act without express permission of the copyright owner is unlawful. Request for further information should be addressed to the Permissions Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or resale. The Publisher assumes no responsibility for errors, omissions, or damages, caused by the use of these programs or from the use of the information herein.
