Appunti Project management (in inglese)

Parte 1: Definition of project

“A project is the answer to a need”

• “Unique product or service” (Project Management Institute)
• “A project is a single series of activities aimed at producing a definitive result, with a precise start and end date, and a precise allocation of resources” (Harward Business School, project management manual)
• “A project is a complex, unique undertaking of a specific duration, aimed at achieving a clear and predefined objective through a continuous process of planning and control of differentiated resources and with interdependent constraints of costs-time-quality” (Russell D. Archibald)
• “A project is a temporary organization created with the purpose of delivering one or more business products in accordance with a specific business game” (PRINCE2)

Characteristics of the projects

• Impromptu nature meaning unique product or service
• Temporary meaning that is defined a start and end (in the end objectives could be achieved or not), temporary does not mean short-lived
• Unique meaning that it has never been done before. Uniqueness (and therefore unrepeatability) given by the objective set and the constraints that distinguish it (financial, temporal, resources)
• Complex undertaking meaning that each phase is linked to the others

The cost of accelerating a project increases more than proportionally as it approaches completion; risks and uncertainties (and the probability of not achieving the goal) are highest at the beginning. Projects can be conceived as a pyramid with a triangular base, where sides are represented by quality, times, costs; the basis is the risks, and the volume is the scope of the project.

The pyramid of project elements

5 knowledge areas (defined by PMBOK): Project scope management, Project time management, Project cost management, Project quality management, Project risk management.

4 areas (considered by Project Management Institute): Project integration management, Project human resources management, Project communications management, Supply management.

Several kinds of projects exist like aerospace or military one, strategic or organizational change projects, telecommunications system projects, organization of large events, plan projects, information systems projects, development aid projects.

Another classification: Media & Entertainment Projects, New product or service development projects, Research and development projects.

Another classification: Production project (sectors organized by projects), Innovative project (advanced technologies), Renewal project (organizational development).

Projects life cycle

Life cycle of a project: A project is made up of managerial and technical aspects.

Management aspects (project management processes), generally called project management aspects, concern the initiation, definition, planning, execution, control and closure of a project or its phase. They are applicable to all types of projects.

Technical aspects (product processes) are specific for each application sector and are closely linked to the type of product or service to be created. This involves the feasibility study, the definition of product specifications, etc.

Internal vs external projects

There are mainly two types of projects, internal and external projects: internal projects are done by you for you, your company, the scope of the project is interesting for you, external projects are projects you are doing for someone else. This is important because if we are doing an internal project I am doing something for myself, if something is different from the expectation I don’t have to answer to anyone; in an external project there is someone who pays, so he decides, and there is a contract, there are conditions that must be respected.

When you are selecting project work pay attention if you are selecting internal or external project, these are two different points of view of the project. (It’s easier to do an external project for the project work).

Examples

• External project: New product, festival, stadium…
• Internal project: You are the owner of the building and, for example, you want to transform it.

What is Project management?

• Deals with management of all those variables that affect achievement of the result of a project.
• It’s not only technical aspect, but it’s also managing the people.
• PM is a set of dynamic, multidisciplinary principles, improved through practice, formalized as a discipline. PM is a system composed of soft and hard (technical) skills.

PM is everything except the managing day by day, like operations management or process management.

Definitions of project management (PM)

• “PM is the application of knowledge, skills, tools and techniques to project activities to meet project requirements. Project management is performed through the use of processes such as official initiation, planning, execution, control and closure” (Project Management Institute)
• “PM consists of the planning, monitoring and control of all aspects of the project and the motivation of all those involved in it to achieve the project objectives on time and within cost, quality and performance specifications” (PRINCE2)
• “PM is a philosophy and technique that allows its practitioners to realize their maximum potential within the constraints of limited resources, thereby increasing profitability” (Pinto, 2001)
• “PM is the art of directing and coordinating human and material resources to achieve certain objectives within time, budget and customer satisfaction constraints” (Max Wideman) (You are working in a project where you have limited money, limited time, and you have to reach the goal.)

Definitions of PM functions

1. Define: Determine the overall vision, objectives, responsibilities, and outcomes of a project. It’s quite important to define the responsibility in a project, we need to understand which is the person who can solve a problem, the person who can absolve a role, etc…
2. Plan and organize: Determine the steps necessary to execute the project, assign responsibilities and identify start and end dates. When the project starts and when the project should end?
   Planning involves breaking down activities, scheduling start and end dates, assessing risks, calculating costs, preparing documentation etc.
3. Check: Continuously ensure that the project is achieving its objectives within the expected timescales and costs.
4. Lead: The project manager “uses” his leadership to implement the project efficiently and effectively.
5. Closing: Closing a project efficiently and effectively also involves compiling project statistics and preparing final documentation. It’s an important part of the project, when we arrive at the end of a project.

Aspects of a project management

• Mentality: Personal attitude

Organigram of a project can be very complex but it’s different from organigram of a company.

• Organization: Corporate intervention
• Techniques: There are many courses
• Tools: Market research, these are tools that you can use

Integration between the Three Project Management

This wants to show that you have to manage, in the planning and control of the project, three aspects: you have to respect the time, you have limited resources, and costs.

Project management objectives

These are objectives of external projects:

• Improving communications with customers, customer is who pays you
• Reducing the risk of failure, failure means that you don’t arrive at the end of the project
• Quality improvement. If the customer changes the idea, in the contract it should be written, we can
• Improving the level of customer satisfaction
• The improvement of the corporate image. Doing project for others, it’s important that the company has a good reputation, so the Project Manager represents also the brand of the company, so the company image.

Internal objectives:

• Improving project team communications. I want to improve the capability of working together.
• Reduction of errors and improvement of process quality. (Activities inside the project are usually the same, so…)
• Reduction of production times
• Reducing project costs. If you are doing something for others and you define the cost, if you reduce the cost the customers are happier, but you don’t care. If you do the project for yourself, reducing cost is more interesting.
• The creation of a database of lessons learned

This shows the cost of a project management, and the results. In particular, the creation of a database of lessons learned:

Main phases of project management (PM)

Vertical axes describe the main disciplines involved in project management: communications, sources, resources, risks, costs, time, quality, scope (resources are people, sources are approvvigionamenti).

On the spring axes (asse molla) there are the steps, and the activities, that we should do in the project management: plan, organization, do, monitoring, guide.

On the other axes there are the life cycle phase of the projects.

Phases of project management

1. Conception
2. Definition and initiation
3. Planning
4. Programming
5. Execution
6. Monitoring and control
7. Closing

This classification is similar to what we have seen in previous slides.

1. Concept phase

It’s different if you are doing an internal or an external project. Internal projects: starting from the recognition of a need or problem, an internal project is conceived. External projects: starting from the requests of current and potential customers, external projects are conceived.

(Def of project: project is what we have to solve, not the resolution, I have a problem)

If the project is an external project you don’t care about the returnment of the investment.

2. Definition and initiation

You have to justify why you are doing this project. In this process, the main contents and parameters characterizing the new project are identified. It’s important doing a justification of what you are doing in the project, because it’s aligning the objectives of who is paying with who is paying.

Input: market analysis

Output: the content and characteristics of the product to be created are explicitly defined and the specifications of the work to be developed are explored in depth.

3. Planning

It’s not only the problem of time, but it includes the union of activities, resources and the cost of a project. Planning includes the activities of identifying and defining the project scope, its activities and resources required and therefore its costs. It includes planning for expected quality, identification and measurement of project-related risks, and risk response planning (the scope is aligned with the quality).

The risk is everything that goes different from what you expect, risk is what is different from the basement, so from what was planned, it could be also an opportunity.

Project responsibilities are defined (every activity has to have someone who is responsible). Project purchases and suppliers are planned (I know when I will need…)

4. Programming

The objective of this phase is the scheduling of all the activities making up the project (identified in the planning phase). Schedule means deciding day by day what we should do. Programming a project is a decision problem multi-objective making (objectives in conflict with each other).

The programming includes: Analysis of resource availability (human, financial, material); Application of scheduling techniques (CPM, PERT, GANTT).

5. Execution

In this part of the project, you need to have people who are competent in the domain of the project (example: if you are doing a film, you need actors). It’s the main phase for the realization of the project. Execution concerns the development and technical realization of the products or services covered by the project. This phase is closely linked to the sector in which you operate. Predominance of technical aspects.

6. Monitoring and control

Monitoring and control activities are transversal to all other activities, throughout the project life cycle. Objective: define deviations (managing the risk), promptly identify potential problems, in order to adopt the necessary corrective actions. If there is a problem you can adopt a correction, as soon as you correct the problems, the better is for the project.

If you want to understand if the project is going well or not you should plan some controls, so you have to define the control you want to do during the project. Deviations from performance are analysed with reference to the project plan (drawn up in the planning phase).

Reporting is the activity: the controller is a person that has to check what is happening in a project, but he needs to have information of the project to control it. So we have reporting.

7. Closing

It’s an important part, in this you can classify all the important knowledge, knowledge is acquired from the people who have done the project, so you take the knowledge inside your company. It’s defined as the systematic and formalized closure phase of a project's activities. In this phase, meetings are planned for the project team to analyse the lessons learned (lessons learned).

We can use AI to extract knowledge from the documentation of a project and use it in other projects.

Evolution of PM

Project management is not a twentieth century invention, it’s quite old, and it’s not born in classes.

With industrialization for the first time begins the concept of organization, so the idea of a group of people working for the same project. We can say that the discipline of the PM started with the first industrialization.

A big acceleration of PM happens with the IWW and then with the IIWW, because we had to solve problems in a very short time. Representation of a project in a graphical way, two ways AOA (activity on arrow) and AON (activity on node).

• Even before 1950, the basic concepts and tools for planning and control were already known at that time:
  • The definition of activities (the concept of decomposing a complex task into many easier tasks)
  • Resource constraints, precedence relationships, and sequencing
• Those concepts formed the basis of modern project management techniques.
• What has gradually changed is: the hierarchical management system of direction and control.

2000: you have to manage not only a project but a portfolio of projects. If you have a portfolio of project you will have to split your time between different activities, a part of time will be divided in different projects and another part of time will be for operations.

Before the 50s

The problem was to build new things (during the wars the problem was time), but after the problem was to build things, in large organizations, so to coordinate activities and reach the goals.

• There was no need for strong project authority, complex customer interfaces, cross-functional integration, and staff motivation and training.
• The surrounding environment was quite stable compared to the adaptation times of a rigidly hierarchical, predictable and constant structure.
• The objectives, rules, procedures of the organization were well understood by everyone and the human resources were trained to adapt to the organization. (If you arrive at the end of the project is good for everyone)

After the 50s

I have to justify why I should do a project.

• Information technology development, considerable support for planning and control tools, project management towards an integrated system approach.
• The complexity of the project in terms of technological sophistication, number of activities, suppliers and skills involved made the adoption of a matrix structure and the development of planning and control techniques still applied today indispensable. The projects now are multidisciplinary projects so you need to have so many skills to do a project and arrive in the end.

Institutions worldwide

• Project Management Institute (PMI)
• International Project Management Association (IPMA)

Project life cycle

Every project is born with an idea or a concept.

Engineering & Contracting (E&C): it’s a market very common in Italy; the goal is to deliver new buildings, platforms, oil and gas platforms. Saipem Technip, for example, produces buildings and oil and gas platforms, and are Baker Hugs suppliers. Markup very low (around 3%), when you produce goods markups are around 20%.

Projects can be internal or external:

• Internal projects: Arise within the organization due to perceived needs or identified problems
• External projects: Arise from requests from current or potential customers.

In both cases (internal and external project) you have to define the objectives.

Objectives can be explicit or implicit. The success of a project also depends on the process of defining and managing the project objectives. The SMART test is the application of a test to each goal of the project, there are a list of adjectives (like simple, easy to understand, etc), and every goal need to be calculated using this list and accepted by the customer.

Each goal must be Simple, Measurable, Achievable (technologies), Realistic and Timelined (for every goal you need to define the timeline, so when you have to define the goal).

When you define the goal of the project, the goal is something that YOU define, it’s not about the customer.

The definition of objectives

The definition of objectives can be divided into the following sub-phases:

• The definition of the requirements
• The formulation of the commercial offer
• The completion of the contract (in big projects the team is made from people with different abilities, for example law, economics, etc…. all of this information is inserted in SOW statement of work. SOW is a document divided into chapters, every chapter is a requirement).
• The management of variations during construction

Statement of work (SOW)

Statement of work (SOW) or requirements definition document.

Event: is something that happens in a specific time.

Document tabs

• Requirement ID
• Type of requirement
• Relate