Construction Project ManagementConstruction Project Management CE-371 CE-371

Lecture 1Lecture 1

IntroductionIntroduction

Engr.Khawaja Mateen MazherLecturer

Department of Construction Engineering and ManagementNIT, SCEE, NUST, Sector H-12, Islamabad

Outline of Today’s LectureOutline of Today’s LectureScope of the Course

Planned Curriculum for CE – 371 (Construction Project Management) in Fall 2012

Miscellaneous Course Information

Introduction (Lecture # 1)

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Scope of the CourseScope of the Course

To acquire key knowledge of “good practices” of project management that may help deliver projects successfully.

To establish an understanding of the project management vocabulary used to effectively communicate between the project teams.

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CE – 371 Construction Project CE – 371 Construction Project ManagementManagement

Planned Curriculum for Fall 2012 (18 Weeks)Planned Curriculum for Fall 2012 (18 Weeks) Introduction 1st WeekProject Life Cycle & Organization 2nd WeekProject Management Processes 3rd WeekProject Scope Management 4th & 5th WeekProject Procurement Management 6th & 7th WeekProject Time management 8th & 9th

WeekProject Cost Management 10th &

11th WeekProject Quality Management 12th & 13th WeekProject Human Resource Management 14th WeekProject Communication Management 15th WeekProject Integration Management 16th Week

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Miscellaneous Course Miscellaneous Course InformationInformationCE – 371: Construction Project Management

Time and Location: Mon - Fri (As Per the Weekly Program),

Instructor: Lecturer. Bilal Zafar

Office Number: -------------

Email: ch_bilal_zafar@yahoo.com

Textbooks:

1. PMI, (2000). A Guide to the Project Management Body of Knowledge, Project Management Institute, USA. (4th Edition) (Available in NIT Library)

2. Oberlender, D. Garold,.(1993), Project Management for Engineering and Construction. (Available in NIT Library)

Reference Books:

1. Kerzner, Harold (2000). Project Management: A Systems Approach to Planning, Scheduling, and Controlling. John Wiley & Sons, Inc. (Available in NIT Library)

2. Lavy, M.,Sidney, (2000). Project Management in Construction. McGraw-Hill. (Available in NIT Library)

3. Barrie and Paulson. (1992). Professional Construction Management: Including C.M, Design-Construct and General Contracting. McGraw-Hill. (Available in NIT Library)

Exams:

There will be Two Class Tests (One hour each) and One final examination (3 hours). These will contribute the majority of the final grade. The 1st Class Test will cover first five titles of the course outline, 2nd Class Test will cover two to three more titles namely project time management and cost management along with procurement management. Rest will be covered before the final week of the exam. The final examination will be held during the final exam week, and covers the entire course,

Home Work:

Homework will be given in accordance with the lectures and topics delivered. (a total of 3/4 Homework / Assignments)

Quiz and Attendance:

There will be 3/4 quiz tests including a couple of pop-up quizzes in class. Students are expected to attend almost all

classes. Poor attendance will affect the final grade of students.

Final Grade:

Final grade will depend on the following components with the proportions mentioned against each:

homework (10%), quiz (10%), Class Tests(30%), final exam (50%).

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Construction IndustryConstruction IndustryThere are three principal

contracting parties involved in any construction projects◦Client / Project Sponsor◦Consultant(s)◦Contractor(s)

What is a Project?What is a Project?A Project is a temporary endeavor to

create a unique product, service or result.

A project is a sequence of unique, complex and connected activities having one goal or purpose that must be completed by a specific time, within budget and according to specification.

A project is a complex, nonroutine, one-time effort limited by time, budget, resources, and performance specifications designed to meet customer needs.

What is a Project? What is a Project? (Characteristics)(Characteristics)

Temporary with a definite beginning and an end (a definite starting and a finishing date)

Creates a unique product, service or resultExecuted for a purpose (has only one goal)Has interrelated activitiesConsume human and non human resources

(i.e., money, people & equipment)There will always be a level of uncertainty

associated with a project (Risk)

Typical Examples of Typical Examples of ProjectsProjectsEffecting a change in the structure,

staffing, or styling of an organization

Developing a new or modified information system

Constructing a building or infrastructure

Implementing a new business process or procedure

PROJECT Vs OPERATIONPROJECT Vs OPERATION

PROJECTTake place outside the process worldUnique and separate from normal organization work

OPERATION/PROCESSOngoing, day-to-day activities

Use existing systems, properties, and capabilities

A set of interrelated actions and activities that are performed to achieve a prespecified set of products, results, or services

„Guide to the Project Management – Body of Knowledge, the Project Management Institute, 4th . Ed., 2010“

Routine, Repetitive Work: Examples

1.Taking class notes

2.Responding to a supply-chain request

3.Routine manufacture of an Apple iPod

Projects: Examples

1.Writing a term paper

2.Developing a supply-chain information system

3.Designing an iPod that is approximately 2 X 4 inches, interfaces with PC, and stores 10,000 songs

What is Project What is Project Management?Management?Project Management is the application

of knowledge, skills, tools and techniques to project activities to meet project requirements.

A method and a set of techniques based on the accepted principles of management used for planning, estimating and controlling work activities to reach a desired end result on time – within budget and according to specification.

What is Project What is Project Management?Management?The art and science of coordinating

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

Project management is the planning, organizing, directing, and controlling of company resources (men, material, machinery and money) for a relatively short-term objective that has been established to complete specific goals and objectives.

What is Project What is Project Management?Management?Managing a project typically includes:

◦ Identifying requirements,◦ Addressing the various needs, concerns,

and expectations of the stakeholders as the project is planned and carried out,

◦ Balancing the competing project constraints including, but not limited to:

Scope, Quality, Schedule, Budget, Resources, and Risk.

What is Project What is Project Management?Management?It is accomplished through

application and integration of logically grouped project management processes which comprises 5 process groups.

◦Initiation◦Planning◦Executing◦Monitoring◦Closeout

What is Project What is Project Management?Management?There are essentially Nine Knowledge Areas:

◦ Project Integration Management◦ Project Scope Management◦ Project Time Management◦ Project Cost Management◦ Project Quality Management◦ Project Human Resource Management◦ Project Communications Management◦ Project Risk Management (Out of scope of our

course work)◦ Project Procurement Management

The Triple Constraint of The Triple Constraint of Project ManagementProject Management

Also called the Project management triangle.

Scope: represents the work to be accomplished, both the “Quantity” and the “Quality”

Budget (Cost): It is the amount / quantum of work measured in units of currency (rupees) or labor-hours of work.

Schedule (Time): Logical sequencing and timing of the work to be performed.

Manage the Triple Constraints

Scope(Performance)

Cost(Budget)

Time(Schedule)

Quality

Like any human undertaking, projects need to be performed and delivered under certain constraints. Traditionally, these constraints have been listed as "scope," "time," and "cost“

Managing triple Managing triple constraintsconstraints

1. Builds the dashboard you use for controlling the project.

2. Without this dashboard, you have no way of knowing where the project is currently headed, how far off course it is, or what action to take to get it back on course.

3. If you neglect this function, you and all project stakeholders are subject to unhappy surprises. 4. Uncontrolled projects rarely reach their goal.

Manage the Triple Constraint

Scope(Performance)

Cost(Budget)

Time(Schedule)

Quality

Defining a Successful ProjectDefining a Successful ProjectCompletion of a Project within the constraints of

time, cost and scope

Project success is defined as project completion:

◦ Within the allocated time period◦ Within the budgeted cost◦ At the proper performance or specification level◦ With acceptance by the customer/user◦ When you can use the customers name as a

reference◦ With minimum or mutually agreed upon scope

changes◦ Without disturbing the main workflow of the

organization◦ Without changing the corporate culture

Advantages of Using Formal Advantages of Using Formal Project ManagementProject Management

Better control of financial, physical, and human resources

Improved customer relationsShorter development timesLower costsHigher quality and increased reliabilityHigher profit marginsImproved productivityBetter internal coordinationHigher worker morale

Technical Focus vs. Project Technical Focus vs. Project Management FocusManagement Focus

In constructing a road, the tech-nical focus will be on site survey-ing, performing precise alignment measurements, assessing the inclination, gradient and curvature of the route, getting the needed equipment, clearing undergrowth and other obstacles, digging and leveling, laying the road sub-base, asphalting, checking road traction, ensuring that an effective drainage system is in place and erecting signage.

In constructing a road, the project management focus will be on en-suring that the work is performed effectively and efficiently according to requirements and specifications, and on time and within budget, that risks have been adequately considered and proactively mana-ged, that proper communication and coordination between all stake-holders concerned takes place, and that regular work monitoring, evaluation and controlling is assured.

Program ManagementProgram Management

Program Management◦ A program is defined as a group of related projects

managed in a coordinated way to obtain benefits and control which cannot be achieved by managing them individually.

◦ This coordination may provide decreased risk, economies of scale and improved management that could not have been achieved if they were to be treated separately.

Program management is defined as the centralized coordinated management of a program to achieve the program’s strategic objectives and benefits. Projects within a program are related through the common outcome or collective capability.

Program ManagementProgram ManagementProjects within a program may have different

objectives but they share a common GOAL.An example of a program would be a new

communications satellite system with projects for◦ design of the satellite and of the ground stations,

construction of each, integration of the system, and launch of the satellite.

Schools ConstuctionSchools Constuction

Facilities MaintenanceFacilities Maintenance

Private schools asstPrivate schools asst

Elementry Education Elementry Education

Teachers HiringTeachers Hiring

Teachers training Teachers training

Special InitiativesSpecial Initiatives

A CAPITALINVESTMENT

PROGRAM

A CAPITALINVESTMENT

PROGRAM

may comprise following projects

Project for Upgrading EquipmentProject for Upgrading Equipment

Project for Training PersonnelProject for Training Personnel

Project for Expanding Production Lines

Project for Expanding Production Lines

Project for Acquiring Large-ScaleFunding

Project for Acquiring Large-ScaleFunding

Example of a ProgramExample of a Program

Program & Project: SimilaritiesProgram & Project: Similarities

Program and projects have goals and objectives which define their purpose of existence

Program and projects have life-spans defining a starting and ending point in time

Program and projects consume resources and necessarily incur cost

Program and projects require application of a methodology and must be managed properly to ensure their chances of success

Program and projects aim at helping organizations achieve their mission and adding value to them.

Program & Projects: DifferencesProgram & Projects: DifferencesX Program may have multiple goals whereas projects

have one prime goal

X A program has a comparatively longer life-span, and obviously costs more than the combination of all the projects which constitute it

X A program is inherently more complex than a constituting project – it has a broader scope and may require extensive coordination between its various constituting projects

X Whereas a project results in the creation of an output and is then ended, a program must integrate and maintain the operationality of that output for a specified period of time

Portfolio ManagementPortfolio ManagementPortfolio

◦ A portfolio refers to a collection of projects or programs and other work grouped together to facilitate effective management of that work to meet strategic business objectives

◦ Projects included in a portfolio may or may not be of a common type or have common objectives other than serving enterprise’s over all goals which may include but are not limited to profit maximization, strategic fit, risks, cost etc.

◦ Some portfolios may be quite large, comprising dozens or hundreds of projects and consume lots of an organization‘s resources

◦ The projects comprising the portfolio may be in various stages of initiation, planning, and implementation

Portfolio ManagementPortfolio Management The projects or programs of the portfolio may not

necessarily be interdependent or directly related. For example, an infrastructure firm that has the strategic objective of “maximizing the return on its investments” may put together a portfolio that includes a mix of projects in oil and gas, power, water, roads, rail, and airports. From this mix, the firm may choose to manage related projects as one program. All of the power projects may be grouped together as a power program. Similarly, all of the water projects may be grouped together as a water program.

Project portfolio management is the responsibility of corporate management and is therefore beyond the individual responsibility of a project manager.

What is Project Portfolio What is Project Portfolio Management?Management?

Project Portfolio Management (PPM) is a management

process designed to help an organization identify new project

opportunities, acquire information about these opportunities,

and rank and prioritize them against a specified set of criteria

such as strategic fit, cost, risk, expected return etc.

PPM is also about periodically and carefully reviewing all the

projects which have been selected for inclusion in the

portfolio and which are in various stages of initiation, planning

and implementation, with a view to determining which

projects should move up on the priority scale (and thus get

preference for available resources), which ones should move

down and which projects should be considered for

modification and/or premature termination.

Project Management & Project Management & Portfolio ManagementPortfolio Management

Project Management is about “doing projects right” after the projects have been accepted for

inclusion in the project portfolio.

Project Portfolio Management is about “doing the right projects”, namely, ensuring that only

those projects are selected for subsequent inclusion in the project portfolio which will add

value to the organization.

while

Project Management Office Project Management Office (PMO)(PMO)A Project Management Office (PMO)

is an organizational body which has been assigned various responsibilities related to centralized and coordinated management of the projects which comes under its domain

It may provide support functions (develop standards for project management, etc) as well as taking responsibility for the direct management of the project

Project Management Office Project Management Office (PMO)(PMO) It may be given authority to take key decisions such

as termination of projects and alignment of project objectives with organizational strategic plans.

A primary function of a PMO is to support project managers in a variety of ways which may include, but are not limited to:◦ Managing shared resources across all projects

administered by the PMO;◦ Identifying and developing project management

methodology, best practices, and standards;◦ Coaching, mentoring, training, and oversight;◦ Monitoring compliance with project management

standards, policies, procedures, and templates via project audits;

◦ Developing and managing project policies, procedures, templates, and other shared documentation (organizational process assets)

◦ Coordinating communication across projects.

The Role of a Project The Role of a Project ManagerManager

The Project Manager is the person assigned by the organization to achieve the required project objectives.

The role of a project manager is to lead the project team to ensure a quality project within time, budget, and scope constraints. A project is a single, non-repetitive enterprise and because each project is unique, its outcome can never be predicted with absolute confidence. A project manger must achieve the end results despite all the risks and problems that are encountered. The project manager must perform the five basic functions of management: planning, organizing, staffing, directing, and controlling.

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Project Manager Role in PlanningProject Manager Role in Planning

Develop planning focused on the work to be performed.

Establish project objectives and performance requirements early so everyone involved knows what is required.

Involve all discipline managers and key staff members in the process of planning and estimating.

Establish clear and well-defined milestones in the project so all concerned will know what is to be accomplished , and when it is to be completed.

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Project Manager’s Role in Project Manager’s Role in PlanningPlanning Build contingencies into the plan to provide a

reserve in the schedule for unforeseen future problems.

Avoid reprogramming or re-planning the project unless absolutely necessary.

Prepare formal agreements with appropriate parties whenever there is a change in the project and establish methods to control changes.

Communicate the project plan to clearly define individual responsibilities, schedules, and budgets.

Remember that the best-prepared plans are worthless unless they are implemented.

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Project Manager’s Role in Project Manager’s Role in OrganizingOrganizing Organize the project around the work to

be accomplished. Develop a work breakdown structure

that divides the project into definable and measurable units of a work.

Establish a project organization chart for each project to show who does what.

Define clearly the authority and responsibility for all project team members.

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Project Manager’s Role in StaffingProject Manager’s Role in Staffing Define clearly the work to be performed,

and work with appropriate department managers in selecting team members.

Provide an effective orientation (project goals and objectives) for team members at the beginning of the project.

Explain clearly to team members what is expected of them and how their work fits into the total project.

Solicit each team member’s input to clearly define and agree upon scope, budget, and schedule.

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Project Manager’s Role in Project Manager’s Role in DirectingDirecting Serve as an effective leader in coordinating all

important aspects of the project. Show interest and enthusiasm in the project with a

“can do” attitude. Be available to the project staff, get problems out

in the open, and work out problems in a cooperative manner

Analyze and investigate problems early so solutions can be found at the earliest possible date.

Obtain the resources needed by the project team to accomplish their work to complete the project

Recognize the importance of team members, compliment them for good work, guide them in correcting mistakes, and build an effective team.

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Project Manager’s Role in Project Manager’s Role in ControllingControlling

Maintain a record of planned and actual work accomplished to measure project performance

Maintain a current milestone chart that displays planned and achieved milestones

Maintain a monthly project cost chart which displays planned expenditures and actual expenditures

Keep records of meetings, telephone conversations, and agreements

Keep everyone informed, ensuring that no one gets any “surprises”, and have solutions or proposed solutions to problems. 38

Goals & ObjectivesGoals & ObjectivesGoals are high level statements that provide

overall context for what the project is trying to achieve◦ "increase the overall satisfaction levels for clients

calling to the company helpdesk with support needs".Objectives are lower level statements that

describe the specific, tangible products and deliverables that the project will deliver. A well-worded objective will be Specific, Measurable, Attainable/Achievable, Realistic and Time-bound (SMART). ◦  "upgrade the helpdesk telephone system by

December 31 to achieve average client wait times of no more than two minutes"

Projects & Strategic PlanningProjects & Strategic PlanningProjects are often utilized as a means

of achieving an organization’s strategic plan. Projects are typically authorized as a result of one or more of the following strategic considerations:◦Market demand (e.g., a car company

authorizing a project to build more fuel-efficient cars in response to gasoline shortages),

◦Strategic opportunity/business need (e.g., a training company authorizing a project to create a new course to increase its revenues),

◦Customer request (e.g., an electric utility authorizing a project to build a new substation to serve a new industrial park),

◦Technological advance (e.g., an electronics firm authorizing a new project to develop a faster, cheaper, and smaller laptop after advances in computer memory and electronics technology),

◦Legal requirements (e.g., a chemical manufacturer authorizes a project to establish guidelines for the handling of a new toxic material).

Projects & Strategic Planning