Project Management

Lesson 2: Project
Management Processes

Tran Van Ly
Industrial and Systems Engineering
21/10/08 International University 1
Email: [email protected]
Overall

2
Review Week 1

3
 Review Week 1

• 2 properties of a project?
• 5 processes of project management?
• 5 or 6 process constraints? List
• Differences between portfolio, program,
project?
• Characteristics of project life cycle?
• Project stakeholders?
• 6 organization structures? 4
Review Week 1

5
Learning Objectives

• Common project
management process
interactions
• Project management
process groups
• Initiating process group
• Planning process group
https://www.youtube.com/watch?v=pHsjN3
BiJIQ 6
 Common project management
process interactions
Monitoring & Controlling
Processes
Planning

Enter phase/ Initiating Closing Exist phase/

start project Processes Processes End project

Executing

Project Management Process Groups

Project cycle – ODA project
Type of Project

• EPC
• BT
• BOT
• TPP (Tripartite Partnership)
• Turnkey
• …..
Process groups interact in a phases
of project
 Initiating process
• Consists of those processes performed to
define (1) a new project or (2) a new
phase of an existing project by obtaining
authorization to start the project or
phase.
• First stop of initiating process is to develop
the project charter
• Second stop is stakeholder identification
 1. Project Charter
(Complete a sample)
 Project charter input
• Contract
• Project statement of work
• Business case
• Organizational process assets
• Enterprise environmental factors
 Project charter input
• Contract
• Project statement of work
• Business case
• Organizational process assets
• Enterprise environmental factors
 Project statement of work
• The statement of work (SOW) is a
narrative description of products or
services to be delivered by the project
– Internal project: SOW is provided by project
initiator/sponsor, based on (1) business
needs, (2) product, (3) service requirements
– External project: SOW can be received from
the customer as part of a bid document (e.g.,
request for proposal/ information/ bid/ part of
a contract)
 Project statement of work
• The content of SOW should contain or consider
all of the following elements:
– Business need
– Product scope description
– Strategic Plan
 Business case
• The business case or similar document
provides the necessary information from a
business standpoint to determine whether
or not the project is worth the required
investment.
 Business case
– The business case is created as a result of
one or more of the following
• Market demand
• Organizational need
• Customer request
• Technological advance
• Legal requirement
• Ecological impacts
• Social need
 Business case
• A business case is a document which
justifies the start-up of a project. It
includes:
• problem or opportunity that exists in the business;
• a list of the available options for delivering a
solution to resolve the problem;
• a list of the costs and benefits associated with
each solution option;
• a recommended solution option for approval.
 Organizational process
assets
• Organization process assets refers to the
organization’s policies, guidelines,
procedures, plans, approaches, or
standards for conducting work and
including project work
• Organization process assets includes the
information the organization has learned
on previous projects
 Enterprise environmental
factors
• Enterprise environmental factors refer to
the factors outside of the project itself that
have (or may have) significant influence on
the success of the project
• Environmental factors include:
– Organizational or company culture and
structure
– Governmental or industry standards
– Infrastructure
 Enterprise environmental
factors
– Human resources
– Personnel administration
– Organization’s work authorization system
– Marketplace conditions
– Commercial databases
– Project management information systems
2. Stakeholder identification
 Stakeholder identification
• In the initiation phase, all stake holders
should be identified.

• Stakeholders interested in value of IT

– Investors
– Requirement decision makers
– Users of IT services
• Providers of IT services
– Managers
– Developers or vendors
– Operators
• Other
– Security, privacy and/or risk officers
– Assurance advisors
Content of project
charter
 Minimum elements of
project charter
• Purpose or justification for the project
• Business need for the project
• Business justification for the project, including
return on investment analysis
• High-level project description or product
description
• Requirements that must be completed
satisfactorily according to stakeholder,
sponsor, and customer expectations
 Minimum elements of
project charter
• Stakeholder influences
• Involvement of other departments (in the
functional organization) and the level of
participation needed
• Constraints
• Assumptions
• Summary milestone schedule (preliminary)
• Summary budget (preliminary)
• Name of the project manager and their authority
levels
 Project charter sign-off
• Project charter isn’t complete until you’ve
received sign-off from sponsor, senior
management, and key stakeholders
Developing a Preliminary
Project Scope Statement
 Input
• Project charter
• Project SOW
• Enterprise environmental factors
• Organizational process assests
 Preliminary scope statement
should contain
• Project objectives
• Characteristics of the project or service of
the project
• Product objectives
• Project deliverables
• Requirements (both product and project)
• Exclusions from scope (project
boundaries)
 Preliminary scope statement
should contain
• Constraints
• Assumptions
• High – level risk list and definition
• Milestones
• Initial WBS (work breakdown structure)
• Cost estimate
• Configuration management requirements
• Project acceptance criteria
 Sequence of initiating process

Develop a Under take Establish the Appoint the

business case a feasibility study terms of reference project team

Known as Set up a
project office
Develop Project
project charter definition report
Perform phase
review
Planning process
Planning
 1

2
Develop
3
Project
4
Management
Plan 5
- Data Flow 6
Diagram
7

10

11
 1

Define
Scope
-Data
Flow
Diagram
2

Create WBS - Data Flow Diagram

 Characteristic of an output structure

An example of output
structure for a road-
building project
 For WBS

An example of process structure for a road-building project

 For WBS

Level of detail – Examples of output and process structure

 For WBS

Selecting appropriate time-frame for process evaluation

For WBS
4

Collect Requirements - Data Flow Diagram

5

Determine Budget - Data Flow Diagram

6

Develop Schedule - Data Flow Diagram

7

Plan Quality - Data Flow Diagram

8

Develop Human Resource Plan - Data Flow Diagram

9

Plan Communication - Data Flow Diagram

10

Plan Risk Management - Data Flow Diagram

 11

Plan
Procurements
Data Flow
Diagram
9

Develop Human Resource Plan - Data Flow Diagram

 Selecting and prioritizing projects

• Selection methods vary depending on

– The company
– The people serving on the selection committee
– Criteria used
– The project
&
– Can be purely financial
– Can be purely marketing
– Can be based on public perception (let’s customers
or affected people talk) or political perception.
– Most cases, the decision is based on a combination
of all of these and more
4-stage planning project selection

Determine organizational
strategy, goals & objective
Strategic
Analyze how various
business areas can help
Business area achieve strategic goals
analysis
Identify potential
Project selection projects to help meet strategic
goals
Resource allocation Allocate resources selected
projects
 Steps in the analysis
1. Define the alternatives
2. Determine the study period
3. Provide estimates of the cash-flows for each alternative
4. Specific the interest rate (MARR)
5. Select the measures(s) of effectiveness (ie. the criteria
for judging success)
6. Compare the alternatives
7. Perform sensitive analysis
8. Select the preferred alternatives
Performing financial projections
(Engineering economy)
 Present Worth/ Future
Worth/Annual Worth Analysis
 Internal Rate of Return (IRR)
 Return on Investment (ROI)
 Payback time
 Selection methods
Mathematical models

Benefit measurement
Cost - benefit
methods

Scoring models

Cash flow
Net present value
analysis techniques

Payback period

Discounted cash flow

Internal rate return

Project - Selection

Location

Site...
 Project – SWOT Analysis

 
Project - Selection

Alternatives
Decision tree

…..
 Summary & Homework

Charter: 1) in put; 2) output: ? Components

Project Scope Statement …..
Alternatives, decision tree
Your group project (up to 9 members)
-Area, Scope, Schedule
List down the main key success factors,
project deliverables
Compile the Project Charter of your Group
Project