MBA General - Project Management

LECTURE 1
Introduction to Project Management

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“All of mankind’s greatest accomplishments -
from building the great pyramids to
discovering a cure for polio to putting a man
on the moon - began as a project”

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 What is a Project?
Unique process consisting of a set of coordinated and
controlled activities with start and finish dates, undertaken to
achieve an objective conforming to specific requirements,
including constraints of time, cost, quality and resources”

•A Project is a planned set of activities

•A Project has a scope
•A Project has time, cost, quality and resource constraints

•The end is reached when the project’s objectives have been

achieved or when the project is terminated because its
objectives will not or cannot be met, or when the need for the
project no longer exists. 3
The major characteristics of a project are as follows:
i.An established objective;
ii.A defined life span with a beginning and an end;
iii.The involvement of several departments and
professionals;
iv.Specific time, cost and performance requirements.
v.Projects consist of several activities.

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There are many definitions of a project:

•An investment activity in which financial resources

are used to create capital assets that produce benefits
over an extended period of time.

•An activity for which money will be spent in

expectation of returns and which logically seems to
lend itself to planning, financing, and implementing
as a unit.

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• A project is likely to comprise a few or all of these five
elements:
– Capital investment in civil works, and equipment, or both
– Provision of services for design and engineering,
supervision of construction, and improvement of
operations and maintenance
– Strengthening of local institutions concerned with
implementing and operating the project, including the
training of local managers and staff
– Improvements in policies (e.g. pricing, subsidies, and cost
recovery) that affect project performance and the
relationship of the project both to the sector in which it
falls and to broader national development objectives
– An implementation plan for the above activities.
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• Examples of projects include, but are not limited to:
– Developing a new product, service, or result;
– Effecting a change in the structure, processes, staffing, or
style of an organisation;
– Developing or acquiring a new or modified information
system (hardware or software);
– Conducting a research effort whose outcome will be aptly
recorded;
– Constructing a building, industrial plant, or infrastructure;
or
– Implementing, improving, or enhancing existing business
processes and procedures.

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 Examples of Projects
• Designing and constructing a house/building
• Designing and testing a new prototype
• Implementing a new computer system
• Planning and conducting a quality audit
• Improving productivity within a targeted period
• Disaster recovery
• Olympics games
• Launching a new product

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 Project
 Two essential features are present in every project
no matter how simple or complicated they are.

 In the first place, all projects must be planned out in

advance if they are to be successfully executed.

 Secondly, the execution of the project must be

controlled to ensure that the desired results are
achieved.

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 What is Project Management?
• The art of organising, leading, reporting and
completing a project through people.

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 What is Project Management?

• A project is a planned undertaking

• A project manager is a person who causes things
to happen
• Therefore, project management is causing a
planned undertaking to happen.

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 What is Project Management?
• Project management is the application of knowledge,
skills, tools, and techniques to project activities to meet
the project requirements.
• Project management is accomplished through the
appropriate application and integration of logically
grouped project management processes, which are
categorised into five Process Groups, viz:
• Initiating,
• Planning,
• Executing,
• Monitoring and Controlling, and
• Closing.
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 Project Management (PM)?
Project management may be defined as:

•The art and science of coordinating people,

equipment, materials, money, and schedules to
complete a specified project on time and within
approved cost.

•The adept use of techniques and skills in planning and

controlling tasks and resources needed for the project,
from both inside and outside of the organisation, to
achieve results.
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 Purpose of PM
• The purpose of project management is to achieve
successful project completion with the resources
available.

• A successful project is one which:

– has been finished on time
– is within its cost budget
– performs to a technical/performance standard
which satisfies the end user (client/owner).

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Exercise 1
• Write down three attributes of a good Project
Manager.

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A Good Project Manager
–Takes ownership of the whole project
–Is proactive not reactive
–Adequately plans the project
–Is Authoritative (NOT Authoritarian)
–Is Decisive
–Is a Good Communicator
–Manages by data and facts not uniformed optimism
–Leads by example
–Has sound Judgement
–Is a Motivator
–Is Diplomatic
–Can Delegate
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 Project Management
•Managing a project typically includes, but is not limited to:
– Identifying requirements;
– Addressing the various needs, concerns, and expectations of the
stakeholders in planning and executing the project;
– Setting up, maintaining, and carrying out communications among
stakeholders that are active, effective, and collaborative in nature;
– Managing stakeholders towards meeting project requirements and
creating project deliverables;
– Balancing the competing project constraints, which include, but are
not limited to:
• Scope,
• Quality,
• Schedule,
• Budget,
• Resources, and
• Risks.
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 Steps involved in PM
Step 1: Project Definition (to meet the needs of the end user)
• Intended use by the owner upon completion of construction
• Conceptual configurations and components to meet the intended
use
Step 2: Project Scope (to meet the project definition)
• Define the work that must be accomplished
• Identify the quantity, quality, and tasks that must be performed
Step 3: Project Budgeting (to match the project definition and
scope)
• Define the owner's permissible budget
• Determine direct and indirect costs plus contingencies
Step 4: Project Planning (the strategy to accomplish the work)
• Select and assign project staffing
• Identify the tasks required to accomplish the work
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Step 5: Project Scheduling (the product of scope, budgeting,
and planning)
• Arrange and schedule activities in a logical sequence
• Link the costs and resources to the scheduled activities
Step 6: Project Tracking (to ensure the project is progressing
as planned)
• Measure work, time, and costs that are expended
• Compare "actual" to "planned" work, time, and cost
Step 7: Project Close Out (final completion to ensure owner
satisfaction)
• Perform final testing and inspection, archive documents, and
confirm payments
• Turn over the project to the owner

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 Components of Project
• A project consists of four main components: scope, budget,
schedule (time) and quality. When a project is first assigned to a
project manager, it is important that all three of these components
be clearly defined.
• The above are in a certain way the performance indicators of a
project. They would be used to determine the success level of any
project.
• Scope represents the work to be accomplished, i.e. the quantity
and quality of work.
• Budget refers to costs.
• Schedule refers to the logical sequencing and timing of the work
to be performed.
• The quality of a project must meet the owner's satisfaction and is
an integral part of project management.
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• The equilateral triangle represents an important-
principle of project management: a balance is
necessary between the scope, budget, and schedule.
• For any given project there is a certain amount of
work that must be performed and an associated cost
and schedule for producing the work.

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• The source of many problems associated with a
project is failure to properly define the project scope.

• Too often the focus is just on budget or schedule.

Not only should the scope, budget, and schedule be
well defined, but each must be linked to­gether since
one affects the other, both individually and
collectively.

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 The Project Process Design Approval Readiness for
Project Justification
Strategic and Budgetary Gate 1 Gate 2
Gate 0 - Approve Project Definition - Approval of Gate 3 Manufacture
Approval Undertake Design Final Documents - Approval to
place Contract

Initiate Project
Prepare Technical Design
Ensure Machine Compatibility Prepare
Safety Case Modification
Undertake Tender
Project
set-up Project
Major
Definition Conceptual
Project Scheme
Design
Proposals Design Detailed Bid
Appoint Project Sponsor Design Invitation &
Assess Project Priority Assess
Budget Implications
Est. Proj. Deliverables and
Raise/Extend/Update initial TCD-R/PERF Evaluation
Prepare Outline
Objectives Appoint Project Leader
Conceptual Design Define Design Extend TCD-Rs/PERFs
Approve Project Set-up
Constraints Prepare Interface Prepare Sub-system Detailed Design Hold
Requirements Spec. (IRP) Detailed Design Review (DDR)
EFDA/CSU/JOC Management Finalise Conceptual Design Clear Sub-system DDR Issues
Hold Conceptual Design Review Use TCD-I/MMAC for Sub-system DD Approval
(CDR) Clear CDR Issues Prepare Final Documents including:
Initiate Modification Safety Case - Design Documents., Machine *** These will comprise:
Update PMP Compatibility Documents., Safety Case
Approve Proceed to Detailed Design - Technical Specification
Modification
- Drawings
Project Team/IRP/EFDA/CSU/JDC Project Team/Interfaces/EFDA/CSU/JDC - Contractual Requirements

Draft Statement of Requirements (SoR) Compile Tender Docs.***

* This will include: Review & Approve SoR Identify Send out
Resources Appoint Project Raise/Extend Sub-system TCD-Rs/PERFs Invitations (ITTS) Hold
- Initial WBS, OBS and CBS Agree Classifications & Interfaces
Team Produce & Maintain Clarification Meetings Receive
- Project Plan - Prepare Sub-system Scheme Design
Procurement Plans Tenders Evaluate
Risk and Procurement Strategies Hold Sub-system Scheme Design Review (SDR)
Undertake Project Risk Assessment Tenders Arrange
Prepare Project Boundary Document Clear Sub-system SDR Issues site visits Approve
Develop Project Management Plan (PMP)* Update PMP changes to Specs. Choose
** These will only take place here Raise initial TCD-R/PERF** Use TCD-I/MMAC for Sub-system SD preferred Company
for large projects demanding DO Prepare Preliminary Conceptual Design** Approval
effort for preliminary Conceptual Project Team/Contracts/EFDA
Project Team/Interfaces
work
Project Leader/Project Team/EFDA/CSU

Readiness for Operation

Implement Project Gate 4
- Acceptance of System
Note: Overall Project
Complete Project Management and Reporting will
Manufacture
be as defined in the Project
Equipment Install Management Plan (PMP)
Equipment Test &
Commission Confirm
Completion Project
Raise Contract Documentation
Place Contract Review
Hold Kick off Meeting
(KOM) Clarify Issues (Quality Test Equipment against Test Schedule
Plan) Monitor Commission Complete System
Progress Witness key
Procedures Complete Release Undertake Post
Project Team/ICM/EFDA/CSU Project Review
Note Approve Complete
Package**** Approve Release
Note Pack & Dispatch Project Team/CSU
Equipment Confirm Technical Completion
Receive Equipment

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Project Team/Contractor/ICM Review Project Records Complete
Pre-test Equipment
Handover Documents Resolve
Install equipment
Reservations Obtain
Acceptance of Completed Project
**** This includes Project Team/ICM
supporting documentation
Project Team/EFDA/CSU
 Key Points in Project Set-up and Definition

• Create Project Management Plan (PMP)

• Be clear of scope and objectives
• Establish clear statement of what is to be done
(WBS)
• Establish Risks to be Managed
• Establish Costs and Durations
• Establish Resources Required
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 Project Management Plan - PMP
 Master Document for Project
 Defines the following:-
Project Objectives, Scope, Deliverables
Stakeholders (Internal & External)
Work to be done (WBS)
Project Organisation and Resources
Project Costings
Project Schedule
Procurement / Contract Strategy
Risk Management
Quality management
Change Management
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 Project Scope
 Since the project scope defines the work to be
accomplished, it should be the first task in the
development of a project, prior to the development of
either the budget or the schedule.
 Experienced project managers agree that the budget and
schedule are derived from the scope. Too often, top
management specifies a project budget or schedule and
then asks the project team to define a scope to match the
budget.
 This is the reverse order of defining a project and is not
a good project management practice. It is the duty of a
project manager to ensure that the project scope, budget,
and schedule are linked together.
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 Budgeting & Scheduling
 Budgeting is important because it establishes the
amount of money the owner will spend to obtain
the project and the amount of money that the
design and construction organisations will be
compensated for performing the work.
 Scheduling is important because it brings
together project definition, people, cost,
resources, timing, and methods of performing
work to define the logical sequencing of
activities for the project
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 Project Quality
 Quality is an element that is integrated into and between
all parts of a project: scope, budget, and schedule.
Quality is meeting the needs and satisfaction of the
ultimate end user of the project, the owner.
 Quality is the responsibility of all participants in a
project, including all levels of management and workers
in each of the principal parties.
 An attitude of achieving quality must be instilled in
everyone and perpetuate throughout the work environ­
ment.
 The attitude should not be "what can we do to pass
quality control or final inspection?" Instead, it should be
"what can we do to improve our work and what is the
best way we can furnish a project that meets the needs
and satisfaction of the owner?" 29
 Functions of Management
 Management is often summarised into five basic
functions.
• planning,
• organising,
• staffing,
• directing and
• controlling.
Although these basic management functions have been
developed and used by managers of businesses, they apply
equally to the management of a project.
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 Project Management Plan - PMP
 Master Document for Project
 Defines the following:-
Project Objectives, Scope, Deliverables
Stakeholders (Internal & External)
Work to be done (WBS)
Project Organisation and Resources
Project Costings
Project Schedule
Procurement / Contract Strategy
Risk Management
Quality management
Change Management
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Project Planning

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 Project Planning
• Adequate planning leads to the correct completion
of work

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 Planning
• Inadequate planning leads to frustration towards the
end of the project & poor project performance

Project Start Project End

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 Planning
 Planning is the formulation of a course of action to
guide a project to completion.
 It starts at the beginning of a project, with the scope
of work, and continues throughout the life of a
project.
 The establishment of milestones and consideration of
possible constraints are major parts of planning.
 Successful project planning is best accomplished by
the participation of all parties involved in a project.
 There must be an explicit operational plan to guide
the entire project throughout its life. 35
 Work Breakdown Structure (WBS)
• The Work Breakdown Structure is the foundation for
effective project planning, costing and management.
• It is the most important aspect in setting-up a Project

 It is the foundation on which

everything else builds

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 Work Breakdown Structure - Definition

 A Work Breakdown Structure (WBS) is a

hierarchical (from general to specific) tree structure
of deliverables and tasks that need to be performed to
complete a project.

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 Example WBS
IT E R -L ik e
W a ll P r o je c t
1 .0 . 0 .0 .0

R e s e a rc h & E n g in e e r in g EP2 P r o je c t Be I n s t a lla t io n E r o s io n / D e p o s it io n

D e v e lo p m e n t D e s ig n & M a n u f a c t u r e S h u td o w n M anagem ent R e c y c lin g P r e p a r a tio n fo r IL W
1 .1 .0 .0 .0 1 . 2 . 0 .0 .0 1 .3 .0 .0 .0 1 .4 .0 .0 .0 1 .5 .0 .0 .0 1 .6 .0 .0 .0 1 .7 .0 .0 .0

Be S lic e d B e R e m o te O v e r a ll P r o je c t A ssess JET S lic e d B e T ile s E n g in e e r in g

R e c y c lin g T ile s H a n d lin g M anagem ent B e S to c k s I n s t a ll P r e p . D e s ig n & M a n u f.
1 .1 .1 . 0 .0 1 .2 .1 .0 .0 1 .3 .1 .0 .0 1 .4 .1 .0 .0 1 .5 .1 .0 .0 1 .6 .1 .0 .0 1 .7 .1 .0 .0

B u lk W B u lk M e t a l T o r u s I n s t a lla t io n C o n tra c tu a l P r e p a r e & S h ip B u lk M e t a l T ile s E r o s io n / D e p o s it io n

D iv e r to r T ile s G ro u p M anagem ent JE T Be I n s t a ll P r e p . A s s e m b y & C a lib .
1 .1 .2 . 0 .0 1 .2 .2 .0 .0 1 .3 .2 .0 .0 1 .4 .2 .0 .0 1 .5 .2 .0 .0 1 .6 .2 .0 .0 1 .7 .2 .0 .0

W C o a t in g s W C o a te d W a s te M a n . S a fe ty & H P W C o a te d C F C E r o s io n / D e p o s it io n
1 .1 .3 . 0 .0 C F C T ile s G ro u p M anagem ent I n s t a ll P r e p . I n s t a lla t io n
1 .2 .3 .0 .0 1 .3 .3 .0 .0 1 .4 .3 .0 .0 1 .6 .3 .0 .0 1 .7 .3 .0 .0

M a rk e rs E m bedded V a cu um Q u a lity E m b e d . D ia g . E r o s io n / D e p o s it io n
1 .1 .4 . 0 .0 D ia g n o s tic s G ro u p M anagem ent I n s t a ll P r e p . M anagem ent
1 .2 .4 .0 .0 1 .3 .4 .0 .0 1 .4 .4 .0 .0 1 .6 .4 .0 .0 1 .7 .4 .0 .0

R&D E n g in e e r in g D & M I L W T ile R e m o v a l F Z J C o n tra c t I n s t a ll P r e p .

M anagem ent M anagem ent & R e p la c e m e n t M anagem ent M anagem ent
1 .1 .5 . 0 .0 1 .2 .5 .0 .0 1 .3 .5 .0 .0 1 .4 .5 .0 .0 1 .6 .5 .0 .0

B u lk W E P 2 S h u td o w n I n s t a ll P r e p .
T ile s M anagem ent B u lk W
1 .2 .6 .0 .0 1 .3 .6 .0 .0 1 .6 .6 .0 .0

C o m p o n e n t In s p e c t I n s t a ll P r e p .
& R e -p a c k O t h e r A c t iv it ie s
1 .2 .7 .0 .0 1 .6 .7 .0 .0
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 Project Planning - WBS (1)

 Lowest Level of WBS is the Work Package (WP)

 WP can be clearly defined allowing package to be

costed, scheduled and resourced

 WP contains a list of Tasks to be Performed that

form the basis for the Schedule

 WP allows assignment of responsibilities (Work

Package Manger, WPM)

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 Project Planning - WBS (2)
 WBS allows hierarchical build-up of costs and

schedule
 Cost and Schedule can be reported at any level of the

WBS
 WBS facilitates strong management during project

execution (Cost and Schedule control)

 WBS can be used for many other things - Document

Management, Risk Management etc.

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 Project Planning
 A word about Scheduling
– Schedules (task durations) can have a wide
variation
– There is no unique answer. Rather, there is a
statistical variation depending on assumptions
– Need to understand the basis of scheduling (Most
challenging; Most likely; Absolute certainty - bet
your life on it!)
– Most people are very optimistic/naive

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 Project Planning - Key Points
• Recognise that adequate project planning is
essential
• Produce a sound WBS
• Use the framework provided by the Project
Management Plan (PMP) template
• Involve the right people
• Allow enough time
• Be systematic 42
 Organising
 Organising is the arrangement of resources in a
systematic manner to fit the project plan.
 A project must be organised around the work to be
performed.
 There must be a breakdown of the work to be
performed into manageable units, which can be
defined and measured.
 The work breakdown structure (WBS) of a project is
a multi-level system that consists of tasks, subtasks,
and work packages.

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 Staffing
 Staffing is the selection of individuals who have the
expertise to produce the work.
 The persons that are assigned to the project team
influence every part of a project.
 Most managers will readily agree that people are the
most important resource on a project.
 People provide the knowledge to design, coordinate,
and construct the project.
 The numerous problems that arise throughout the life
of a project are solved by people.

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 Directing
 Directing is the guidance of the work required to
complete a project.

 The people on the project staff that provide diverse

technical expertise must be developed into an
effective team.

 Although each person provides work in his or her

area of expertise, the work that is provided by each
must be collectively directed in a common effort and
in a common direction.
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 Controlling
 Controlling is the establishment of a system to
measure, report, and forecast deviations in the
project scope, budget, and schedule.
 The purpose of project control is to determine and
predict deviations in a project so corrective actions
can be taken.
 Project control requires the continual reporting of
information in a timely manner so management can
respond during the project rather than afterwards.
 Control is often the most difficult function of project
management.
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 Role of the Project Manager
• As a single point of responsibility, the project
manager must integrate and coordinate all the
contributions and guides them to successfully
complete the project.
• The following lists some desirable project manager
attributes:
• leadership ability • ability to anticipate problems • ability to
integrate the project stakeholders • operational flexibility • ability
to get things done • ability to negotiate and persuade • understand
the environment within which the project is being managed •
ability to review monitor and control • ability to manage within an
environment of constant change • ability to keep the client happy.
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