CHAPTER ONE
Project Management Overview

Project management has been practiced for hundreds, actually thousands, of years. Long before computers and sophisticated scheduling techniques became available, the ancestors of today’s professional project managers had to determine resource requirements, arrange for material and equipment, and strive to meet a schedule imposed by, in many cases, a powerful leadership entity. They knew that any construction type of undertaking or project endeavor, large or small, required a goal, a set of objectives, a plan, coordination with many functional groups, the management of resources, and the ability to manage change. Additionally, it became very clear that every project requires strong and adaptive leadership. Project managers, by nature of the position, will work with and manage teams and a variety of stakeholders, some of whom can be expected to be a real a challenge to work with. Considering this factor, project managers must continue to develop the skills necessary to balance the expectations and demands of each stakeholder while managing project deliverables. This is driving a change in the role of “project manager” to that of “project leader.” Today’s project managers see themselves as managing part of a business as well as managing a project.

As the world’s business and financial environment has changed and evolved, organizational leaders have recognized the value of project management and the competent project manager. Project management has also become a key factor in strategic planning.

Today, project management is practiced, to some extent, in almost every organization from small businesses to Fortune 500 companies to local and state governments. Some organizations follow a very formal methodology, and many organizations have adopted a “management by projects” approach. Some organizations have established project management offices (PMOs) to assist them in developing standards for managing projects and processes and to ensure that these standards are followed. Studies have indicated that the application of project management results in significantly higher levels of performance than those of organizations that do not have a project management discipline. As the project management discipline is adapted into the culture of an organization, the benefits of project management are quickly realized. These benefits include more efficient scheduling of resources, improved and more reliable estimating, higher quality of deliverables, early identification of project risks, issues and problems, and more effective measurement processes to assess success. In this highly competitive business environment, it is clear that a well- executed project management methodology has become a significant advantage.

Applying project management is certainly a factor in achieving organizational objectives, but it is important to understand the definition and nature of a project. Projects are defined as temporary endeavors with specific start and end dates, and they are initiated to produce a unique product or service. Project management is the application of knowledge skills, tools, and techniques to project activities to meet project objectives. Effective project management is accomplished through the integration of five major project management processes: initiation, planning, execution, monitoring and controlling, and closing. For control purposes, projects are generally divided into phases, and these processes also apply to the management of each phase of a project. As projects are authorized by a project sponsor, a project manager is assigned and becomes accountable for the success of the project through effective leadership and the application of project management techniques. The project manager will ensure coordination between functional organizations and must have the ability to apply the appropriate amount of managerial and cross-organizational support and guidance to achieve success as the project is executed.

Project management, as a discipline or profession, also subscribes to a code of ethics and professional conduct specifically focused on integrity, respect, fairness, and honesty. This includes business ethics as well as project management ethics because we now believe that we are managing our business by projects and that the project managers are actually managing part of a business.

▸ Glossary of Terms

Key project management terms and definitions to review and remember. The disciple of project management includes a lexicon that is widely used in most industries, and it is beneficial to learn the “language” of the professional project manager.

Deliverable

A tangible, verifiable work output. Project work will generally produce multiple deliverables that will comprise the final project deliverable. Deliverables, in some cases can be intangible such as the achievement of good will, brand recognition, and customer satisfaction.

Functional manager

Generally, the manager who “owns” or supervises the resources assigned to project activities. Functional managers are considered to be the technical experts and usually provide information about resource requirements, resource capability, task duration estimates, schedule development, and cost estimates. Project managers engage the assistance of functional managers to develop the project plan and subsidiary project plans.

Non-project-driven

Generally, these organizations may or may not not have a project methodology in place, are not organized around the delivery of projects, and are arranged in a functional organizational structure. Work is generally associated with manufacturing and production lines. Projects are established as needed to improve or support functional lines and activities or organizational changes.

Program

A group of related projects managed in a coordinated way to obtain benefits and control not available from managing them separately. Generally, projects in a program are interrelated.

Project

A temporary endeavor undertaken to create a unique product, service, or result. A project has a specific objective, defined start and end dates, and funding limitations. Projects consume resources including human (labor), equipment and materials. A project is generally multifunctional or cross-organizational in nature. Projects generally produce one or more deliverables and deliverables can be tangible or intangible.

Project-driven organization

Also known as “project based.” In these organizations all work is characterized through projects. Projects are arranged as separate cost centers and the sum of all project work is associated with organizational goals and strategic objectives.

Project management

Application of knowledge skills, tools, and techniques to project activities to meet project requirements. Project management involves the utilization of the five major process groups: initiation, project planning, executing, monitoring and controlling, and closing. These processes are applied to each project phase and enable the project manager to effectively integrate the 10 project management knowledge areas described in the Guide to the Project Management Body of Knowledge (PMBOK® Guide) developed by the Project Management Institute, or PMI.

Project sponsor

Generally, described as the person or organization that authorizes the project and provides the financial resources required to plan, execute, and deliver the project objectives. The sponsor may be joined by other stakeholders to provide committee sponsorship and/or guidance for this project or for a portfolio of projects.

Triple constraint

This term has been used for many years to describe the effects of changes to the competing project demands of time (schedule), cost (budget), and scope (specifications) usually depicted as a triangle. Specifically, the triple constraint emphasized that a change to any one side or element of the triangle will have an effect on the other elements. The triple constraint was also considered to display the key factors that define project success. The triple constraint has been modified and is now part of a list of several competing demands, including scope, time, cost, quality, risk, safety, business value, and resources. Project success is defined using several success factors, including quality, business value added, and fitness for use.

▸ Activities, Questions, and Exercises

Refer to Chapter One of Project Management: A Systems Approach to Planning, Scheduling, and Controlling (12th edition) for supporting information. Review each of the following questions or exercises and provide the answers in the space provided.

Dr. Kerzner’s 16 Points to Project Management Maturity

1. Adopt a project management methodology and use it consistently.
2. Implement a philosophy that drives the company toward project management maturity and communicate it to everyone.
3. Commit to developing effective plans at the beginning of each project.
4. Minimize scope changes by committing to realistic objectives.
5. Recognize that cost and schedule management are inseparable.
6. Select the right person as the project manager.
7. Provide executives with project sponsor information, not project management information.
8. Strengthen involvement and support of line...