University of Palestine - Gaza Faculty of business& IT
Project Management Chapter 3 Successful Initialization and Project
Planning
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Eng.Mosab I. Tabash2 A project life cycle is a collection of
project phases Project phases vary by project or industry, but some
general phases include concept development implementation
support
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Eng.Mosab I. Tabash3 Project Initiation
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Eng.Mosab I. Tabash Problems, needs, and opportunities
continually arise in every organization. Problems: low operational
efficiency, Needs: additional office space, Opportunities:
penetrating a new product These problems, needs, and opportunities
give rise to the identification of solutions. 4 Project
Initiation
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Eng.Mosab I. Tabash Initiation is the process of formally
authorizing a project: 5 Market demand Business need Customer
request Technologic al advance training company authorizes a
project to create a new course to increase its revenues a car
company authorizes a project to build more fuelefficient cars in
response to gasoline shortages an electric utility authorizes a
project to build a new substation to serve a new industrial park
Electronics firm authorizes a new project to develop a video game
player after advances in computer memory Project Initiation
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Eng.Mosab I. Tabash6 A legal requirement (e.g., a paint
manufacturer authorizes a project to establish guidelines for the
handling of toxic materials). A social need (e.g., a
nongovernmental organization in a developing country authorizes a
project to provide potable water systems, latrines, and sanitation
education to low-income communities suffering from high rates of
cholera). Project Initiation
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Eng.Mosab I. Tabash Project Manager Projects are generally
established to carry out change and theres always someone
responsible for the successful completion of each project. As the
project manager, you are the primary change agent, and your guide
for carrying out the change 7
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Eng.Mosab I. Tabash 8 Suggested Skills for a Project Manager
Communication skills: listening, persuading Organizational skills:
planning, goal-setting, analyzing Team Building skills: empathy,
motivation, esprit de corps Leadership skills: sets example,
energetic, vision (big picture), delegates, positive Coping skills:
flexibility, creativity, patience, persistence Technological
skills: experience, project knowledge
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Eng.Mosab I. TabashCourse Technology 2001 9 Most Significant
Characteristics of Effective and Ineffective Project Managers
Leadership by example Visionary Technically competent Decisive Good
communicator Good motivator Stands up to upper management when
necessary Supports team members Encourages new ideas Sets bad
example Not self-assured Lacks technical expertise Poor
communicator Poor motivator Effective Project Managers Ineffective
Project Managers
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Eng.Mosab I. Tabash Recognize the Importance of Project
Stakeholders Recall that project stakeholders are the people
involved in or affected by project activities Project managers must
take time to identify, understand, and manage relationships with
all project stakeholders Using the four frames of organizations can
help meet stakeholder needs and expectations Senior executives are
very important stakeholders
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Eng.Mosab I. TabashCourse Technology 2001 11 Successful
Initiation Top Management Commitment Several studies cite top
management commitment as one of the key factors associated with
project success Top management can help project managers secure
adequate resources, get approval for unique project needs in a
timely manner, receive cooperation from people throughout the
organization, and learn how to be better leaders
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Eng.Mosab I. Tabash 12 Need for Organizational Standards
Standards and guidelines help project managers be more effective
Senior management can encourage the use of standard forms and
software for project management the development and use of
guidelines for writing project plans or providing status
information the creation of a project management office or center
of excellence
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Eng.Mosab I. Tabash Project Scope Project Scope: A specific
definition of what the project does and does not entail. Critical
to managing expectations of customers and workers alike. 13
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Eng.Mosab I. Tabash14 Project Scope Management 1995 CHAOS study
cited user involvement, a clear project mission, a clear statement
of requirements, and proper planning as being important for project
success The program manager of Keller Graduate School of Management
cites proper project definition and scope as the main reasons
projects fail
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Eng.Mosab I. Tabash Project Scope Management Scope refers to
all the work involved in creating the products of the project and
the processes used to create them Project scope management includes
the processes involved in defining and controlling what is or is
not included in the project The project team and stakeholders must
have the same understanding of what products will be produces as a
result of a project and what processes will be used in producing
them
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Eng.Mosab I. Tabash Project Scope Management Processes
Initiation: beginning a project or continuing to the next phase
Scope planning: developing documents to provide the basis for
future project decisions Scope definition: subdividing the major
project deliverables into smaller, more manageable components Scope
verification: formalizing acceptance of the project scope Scope
change control: controlling changes to project scope
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Eng.Mosab I. Tabash Scope Statement The scope statement should
describe the major activities of the project in such a way that it
will be absolutely clear if extra work is added later on. It should
include a project justification a brief description of the projects
products a summary of all project deliverables a statement of what
determines project success
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Eng.Mosab I. Tabash Scope Statement A scope statement is a
document used to develop and confirm a common understanding of the
project scope. The scope statement puts some boundaries on the
project. Scope statement is a main component of the Statement of
Work (SOW) i.e. Project Charter
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Eng.Mosab I. Tabash Scope Creep Scope creep is one of the most
common project afflictions. It means adding work, little by little,
until all original cost and schedule estimates are completely
unachievable. 19
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Eng.Mosab I. Tabash Scope Planning and the Work Breakdown
Structure After completing scope planning, the next step is to
further define the work by breaking it into manageable pieces Good
scope definition helps improve the accuracy of time, cost, and
resource estimates defines a baseline for performance measurement
and project control aids in communicating clear work
responsibilities
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Eng.Mosab I. Tabash Work Breakdown Structure WBS: a work
breakdown structure (WBS) is a detailed, hierarchical (from general
to specific) tree structure of deliverables and tasks that need to
be performed to complete a project. The purpose of a WBS is to
identify the actual tasks to be done in a project. WBS serves as
the basis for much of project planning. Work breakdown structure is
the most common project management tool, it was created by the US
military in the 1960s. 21
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Eng.Mosab I. TabashCopyright Course Technology 2001 22 The Work
Breakdown Structure A work breakdown structure (WBS) is an
outcome-oriented analysis of the work involved in a project that
defines the total scope of the project It is a foundation document
in project management because it provides the basis for planning
and managing project schedules, costs, and changes Work breakdown
structures can be set up in either graphic or outline form
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Eng.Mosab I. Tabash Work Breakdown Structure Steps to develop
the WBS: 1.Identify the final product(s) of the project 2.Define
the products major deliverables, which are often predecessor
deliverables necessary for the project (Summary Tasks) 3.Decompose
major deliverables to a level of detail appropriate for management
and integrated control (Work Package) 23
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Eng.Mosab I. Tabash Principles for Creating WBSs 1. The work
content of a WBS item is the sum of the WBS items below it. 2. A
WBS item is the responsibility of only one individual, even though
many people may be working on it. 3. The WBS must be consistent
with the way in which work is actually going to be performed; it
should serve the project team first and other purposes only if
practical. 4. Project team members should be involved in developing
the WBS to ensure consistency and buy-in. 5. Each WBS item must be
documented to ensure accurate understanding of the scope of work
included and not included in that item. 6. The WBS must be a
flexible tool to accommodate inevitable changes while properly
maintaining control of the work content in the project according to
the scope statement. *Cleland, David I. Project Management:
Strategic Design and Implementation, 1994
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Eng.Mosab I. Tabash Exercise The IUG decided to landscape an
area inside the campus. You were asked to prepare a WBS to assist
the administration in estimating the cost, activities, schedule and
formulating the team to do this project. 25
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Eng.Mosab I. Tabash WBS Chart Form 26
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Eng.Mosab I. Tabash Outline Form 27
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Eng.Mosab I. Tabash Sample Intranet WBS Organized by
Product
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Eng.Mosab I. Tabash Intranet WBS Organized by Phase
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Eng.Mosab I. Tabash Intranet WBS in Outline Form 1.0 Concept
1.1 Evaluate current systems 1.2 Define Requirements 1.2.1 Define
user requirements 1.2.2 Define content requirements 1.2.3 Define
system requirements 1.2.4 Define server owner requirements 1.3
Define specific functionality 1.4 Define risks and risk management
approach 1.5 Develop project plan 1.6 Brief web development team
2.0 Web Site Design 3.0 Web Site Development 4.0 Roll Out 5.0
Support
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Eng.Mosab I. Tabash Financial Analysis of Projects Financial
considerations are often an important consideration in selecting
projects Three primary methods for determining the projected
financial value of projects: Net present value (NPV) analysis
Return on investment (ROI) Payback analysis
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Eng.Mosab I. Tabash Net Present Value Analysis Net present
value (NPV) analysis is a method of calculating the expected net
monetary gain or loss from a project by discounting all expected
future cash inflows and outflows to the present point in time
Projects with a positive NPV should be considered if financial
value is a key criterion The higher the NPV, the better
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Eng.Mosab I. Tabash Net Present Value Example
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Eng.Mosab I. Tabash Return on Investment Return on investment
(ROI) is income divided by investment ROI = (total discounted
benefits - total discounted costs) / discounted costs The higher
the ROI, the better Many organizations have a required rate of
return or minimum acceptable rate of return on investment for
projects
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Eng.Mosab I. Tabash Payback Analysis Another important
financial consideration is payback analysis The payback period is
the amount of time it will take to recoup, in the form of net cash
inflows, the net dollars invested in a project Payback occurs when
the cumulative discounted benefits and costs are greater than zero
Many organizations want projects to have a fairly short payback
period
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Eng.Mosab I. Tabash Weighted Scoring Model A weighted scoring
model is a tool that provides a systematic process for selecting
projects based on many criteria First identify criteria important
to the project selection process Then assign weights (percentages)
to each criterion so they add up to 100% Then assign scores to each
criterion for each project Multiply the scores by the weights and
get the total weighted scores The higher the weighted score, the
better
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Eng.Mosab I. Tabash Weighted Scoring Model for Project
Selection
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Eng.Mosab I. TabashCopyright Course Technology 2001 38 Scope
Verification and Scope Change Control It is very difficult to
create a good scope statement and WBS for a project It is even more
difficult to verify project scope and minimize scope changes Many
projects suffer from scope creep and poor scope verification
FoxMeyer Drug filed for bankruptcy after scope creep on a robotic
warehouse Engineers at Grumman called a system Naziware and refused
to use it
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Eng.Mosab I. Tabash Project Change Management Project faces
changes. An external event (e.g., a change in a government
regulation). An error or omission in defining the specifications of
the product (e.g., failure to include a required feature in the
design of a telecommunications system). An error or omission in
defining the scope of the project (e.g., WBS). A value-adding
change (e.g., an environmental remediation project is able to
reduce costs by taking advantage of technology) 39
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Eng.Mosab I. Tabash Project change management involves
identifying, evaluating, and managing changes throughout the
project life cycle Three main objectives of change control:
Identify the factors that create changes to ensure they are
beneficial and will not have further changes Determine that a
change has occurred Manage actual changes when and as they occur
Project Change Management
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Eng.Mosab I. Tabash The change management process should fit
the size and complexity of the project Project Manager must pay
special attention to the number and diversity of the stakeholders.
Change must be thoroughly integrated with the schedule, cost,
quality and all other aspects of the project management processes
41 Project Change Management
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Eng.Mosab I. Tabash Change Management Steps: 1. Review Project
Plans and all the other components such as the (WBS) - baseline. 2.
Review Project performance reports to know which interim
deliverables have been completed and which have not. Project
reports will alert the project team to issues that may cause
problems in the future. 3. Issue Change request: 42 Project Change
Management
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Eng.Mosab I. Tabash Change requests may occur in many forms
oral or written, direct or indirect, externally or internally
initiated, and legally mandated or optional. Changes may require
expanding the scope or may allow shrinking it. 43 Project Change
Management
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Eng.Mosab I. TabashCourse Technology 2001 44 Project Change
Management
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Eng.Mosab I. Tabash45 Project Change Management Change Request
Change name: Date submitted: Change request number: Requested by:
Submitted by: Detailed Description of Change: Impact Analysis:
Schedule Cost Related affects to other projects or parts of this
project Decision and Rationale Approval:
_________________________________________ Approved by: Approval
date:
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Eng.Mosab I. Tabash Change Log 46 WBS Plan Updates
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Eng.Mosab I. TabashCourse Technology 2001 47 The project team
should strive to do exactly what was planned on time and within
budget Stakeholders may ask for change and this will affect time
and cost Project management is a process of constant communication
and negotiation Solution: Changes are often beneficial, and the
project manager should plan for them Successful Project
Manager-Negotiator and Communicator
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Eng.Mosab I. TabashCourse Technology 2001 48 Change Control
System A formal, documented process that describes when and how
official project documents and work may be changed Describes who is
authorized to make changes and how to make them Often includes a
change control board, and a process for communicating changes
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Eng.Mosab I. Tabash49
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Eng.Mosab I. Tabash Successful Change Management View project
management as a process of constant communications and negotiations
Plan for change Establish a formal change control system, including
a Change Control Board Define procedures for making timely
decisions on smaller changes Use written and oral performance
reports to help identify and manage change Communicate changes
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Eng.Mosab I. Tabash Define scope of project Identify
stakeholders, decision-makers, and escalation procedures Develop
detailed task list (work breakdown structures) Estimate time
requirements Develop initial project management flow chart Identify
required resources and budget Evaluate project requirements
Identify and evaluate risks Prepare contingency plan Identify
interdependencies Identify and track critical milestones
Participate in project phase review Secure needed resources Manage
the change control process Report project status Fifteen Project
Management Job Functions*