Lesson 1 - Project Framework

Lesson 1Project FrameworkProjectA project is a temporary endeavor. It has a definite start date and a definite end date. A projectcreates a unique product, service or result.There are two important points you need to understand: The “temporary” characteristic applies only to the project and not to the output of the project. Outputs of most projects last for long. For example, a project may be undertaken to build an Airport in the outskirts of a city. The project may start, say on the 15th July 2009 and end on the 30th Oct 2011. However, the outcome of the project – the Airport itself – will last for several decades. Projects may have some repetitive elements. However, it does not change the uniqueness of the projectA project starts when an individual or an organization realizes a need for it– the need can be social,environmental, and economic (for-profit) or could be driven by external factors (such as requested bycustomer) or factors internal to your organization. The project ends when the need is met. In somecases a project may also end when you realize that the need cannot be met by the outcome of theproject.Examples of projects include: Developing the transmission system for a new electric vehicle Acquiring a new MIS system for your company Effecting a change in the organization structure of your company Constructing a monument, building or a facility Running an enhanced marketing campaign for a product Implementing a new business process in your organizationProjects always have an end date. In contrast, operations are repetitive and ongoing; they don’t havean end date.

FIGURE 1: Relation between Project, Program and PortfolioProgramA program is a collection of interrelated projects such that it makes sense to manage them togetherrather than individually. Also, failure of one project may result in the failure of the entire program.Let’s say that Indian Space Research Organization (ISRO) is planning to put in orbit theINTELLESAT satellite. This initiative to launch the satellite can be managed individually as severalprojects – one project to build the satellite, one to setup a ground station to monitor the satellite inorbit once launched one to build & commission a launch vehicle that would place the satellite in orbit.However, since all projects share the same objectives – that of putting in orbit the satellite – it makessense for us to manage this as a program.PortfolioA portfolio is a collection of projects and programs. These projects and programs may be or may notbe related in that they may not share the same objectives; however there is a common theme acrossall the projects and programs. The theme could be that all projects and programs are being carriedout for the same customer or the projects and programs may be using the same technology or theymay be in the same domain, say, in the financial sector. When otherwise unrelated projects andprograms have a common theme they can be managed as a portfolio to obtain benefits ofcoordination.FIGURE 1 shows the relationship between Project, Program and Portfolio.StakeholderA stakeholder may be an individual (like the sponsor or the project manager), a group (like theperforming organization, the project team etc.), or an organization (like the Government, therequesting organization etc.) that have a share or interest in the project and are positively ornegatively impacted by its outcome. Stakeholders on a project may include:Customer/End-users: These are people that may use the project's product/service, and may beinternal or external to the performing organization.

Sponsor: The person that provides financial resources, and is expected to play a key role indevelopment of the project charter. The sponsor also serves as an escalation point for issues that arebeyond the control of the project manager.Project Manager: The person assigned by the performing organization to help achieve the projectobjectives. Some of the activities that are expected to be performed by the project manager includedevelopment of a project plan, keeping track of project progress and reporting project status tostakeholders.Functional Manager: Individuals that manage different functions/lines of business. They may providesubject may provide subject matter experts for the project.ConstraintsConstraints are hindrances that may impact the objectives of the project. Primary constraints on aproject can be in terms of scope (features to be added to a product), time (how soon can youimplement these features), cost (can you reduce the costs of implementing these features). Theseconstraints are related to each other in that changing, or acting on one of the three constraints canimpact another. For example, adding most features can increase the time and cost which would beundesirable. Quality is yet another constraint which is impacted by changes to scope, time and cost.Other project constraints that a project manager has to deal with are resources and risk.Role of a Project ManagerThe project manager is responsible for the success or failure of the project. In order to achieve theproject outcomes a project manager must have:Knowledge as well as skills to apply project management practices, tools and techniquesSoft skills – communication skills, interpersonal skills, negotiation, conflict resolution, motivationDomain skills – It is not sufficient if the project manager have skills in project management. She musthave knowledge of the domain or sector of the project. For example, a project manager responsible tobuild a bridge must have skills in the construction domain. Visualizing a project “Begin with the end in mind” - Stephen Covey.A project manager must be able to visualize the project’s product at the start of the project. This ispossible only if the project manager participates in requirements gathering and understands the bigpicture of the project. If a project manager cannot visualize it she would not be able to help the projectteam deliver the product.To successfully achieve the project’s objectives, a project manager must be able to manageexpectations of stakeholders. This can be possible only if the project manager open communicationchannels with stakeholders and continuously provide them the required information on the progressof the project.And finally, to be a successful project manager, she must be able to deal with the project constraints.Balancing the project constraints – scope, time, cost, quality, resources and risk – is an absolute mustin order to successfully achieve the project objectives.

Organization StructuresStructure of an organization has a major influence on performance of projects. There are 3 types oforganizations – Functional, Projectized and Matrix - that you need to be aware of.Functional OrganizationA functional organization is one where employees are grouped by the skills they possess or theirspecialization. In these organizations each employee clearly has one supervisor and they are fiercelyloyal to their department or group. Figure 2 shows a typical structure in a functional organization. Inthese types of organizations employees are attached to their “home” – or the department they workfor – and rarely change their home. Information flow between departments is very weak. Sinceperforming projects require significant exchange of information between departments execution ofprojects in this type of organization is very difficult. Project co-ordination is, therefore, at thefunctional manager’s level. FIGURE 2: Functional OrganizationProjectized OrganizationA projectized organization is one where employees are grouped by the projects they work on.Employees don’t have a home since by definition a project has to end someday. On completion of aproject team members are assigned to a resource pool and await allocation to another project. Teammembers can change projects unlike in a functional organization where employees rarely change theirdepartments. Figure 3 shows a typical projectized organization structure. Exchange of informationbetween projects is good. Project Managers often refer to lessons learnt database that storesinformation about historical and ongoing projects to help them understand and execute their currentproject better. FIGURE 3: Projectized Organization

Matrix OrganizationBoth functional and projectized organizations have their share of good and bad things. It is a knownfact that most organizations world-wide are fast adapting a matrix structure. Matrix organization is amix of functional and projectized organizations bringing together the good attributes of functional andprojectized organization together. Typically, an employee reports to more than one manager – usuallya functional manager and a project manager should the employee be working on a project. There are 3types of matrix organization based on powers of the project/functional manager. These are WeakMatrix, Balanced Matrix and Strong Matrix.Weak Matrix is one where the attributes of the organization are similar to a functional organization.Let’s look at how projects are executed in weak matrix organizations. Figure 4 shows an organizationstructure of an engineering company – a weak matrix organization - that wants to find out the costand technical efficiency of a new welding technology. A team is put together to execute this projectand the team members as shown in the figure are Accountant 3, Analyst 3 and Welder 1. Please notethat these three employees report to their respective functional managers but for the project one ofthe three, say the Accountant, is chosen the project manager. FIGURE 4: Weak MatrixA project manager in a weak matrix is primarily responsible for communications and can be anexpediter or a coordinator depending on the level of her reporting relationship. An Expediter is onethat reports to a lower level manager while a Project Coordinator is one who reports into a slightlymore senior level manager. Project managers in weak matrix do not make any decisions; they onlyenforce the decisions made by functional managers.A Strong Matrix is one whose attributes are similar to a projectized organization. In a strong matrix,project managers have relatively more power than their counterparts in a weak matrix. They areresponsible for the success and failure of the projects. Project managers in this organization reportinto a functional manager who oversees execution of all projects in the organization e.g. Head of theProject Management Office (PMO) as shown in FIGURE 5.

Project Management OfficePMO is a structure that standardizes project related governance. Based on degree of control andinfluence, PMOs can be of the following 3 types1: Supportive – Degree of control is low. Role is consultative, that may involve supplying templates, training on processes, access to lessons learnt from other project etc. Controlling – Degree of control is moderate. Role includes providing support and imposing rules for compliance Directive – Role includes directing and managing the projects. Degree of control is high. FIGURE 5: Strong MatrixProject managers in Balanced Matrix organizations share responsibilities with their functionalcounterparts. Decisions are made jointly by the functional and project manager. A typical structure ofa balanced matrix is shown in FIGURE 6.1 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 10

FIGURE 6: Balanced MatrixIn addition to the Functional, Matrix and Projectized there exists another type - Compositeorganization. This organization is a combination of all other organization types (functional, matrixand projectized). While some projects are executed using a matrix structure, some other are executedusing a projectized structure while remaining using functional. There is no one standard way ofexecuting projects in this type of an organization.Process GroupsPMBOK® Guide 5th edition2 defines 5 categories of processes. These are referred to as ProcessGroups. They are3: Initiating process group Planning process group Executing process group Monitoring & controlling process group, and Closing process groupProcesses in the Initiating process group help you start a project or a phase of a project. Processrequired to define the boundary of the project and establish as well as refine objectives are part of thePlanning process group. Executing process group processes helps your teams perform the work forthe project and attain the planned objectives. Monitoring and controlling process group processeshelp you and stakeholders track the progress of the project and take corrective or preventive actionsshould there be a need to put the project on a desirable track. Closing group processes help youperform the closure activities including documenting the lessons learnt as well as providing feedbackto the organizations’ process manager.FIGURE 7 shows how the process groups interact in a phase or a project.2 PMBOK is a registered mark of the Project Management Institute, Inc3 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 5

FIGURE 7: Process Group interactions4Project PhasesWhen the project is very large and you need extremely good control over deliverables then you breakthe project into phases. Each phase can be carried out sequentially, or where possible with someoverlapping elements. For each phase you can perform the applicable processes in the 5 processgroups. If a project is divided into two or more phases the process groups would interact within eachphase. There are three types of phase-to-phase relationships5:Sequential: A new phase of a project can start only if the previous phase has been completedOverlapping: A new project phase can start prior to completion of the next phase. This may increaserisk of rework on the projectIterative: In cases where projects are not very well defined, it makes sense to plan just one phase. Theplanning for the subsequent phase(s) can start when work progresses on the current phase. Scopemanagement is critical on such projects.Project Life CycleThe work that you do on a project is a collection of sequential and or overlapping phases. The lifecycle of a project can be decided based on the nature of the project as well as your organizations’policies on managing projects. Irrespective of the domain or effort involved the project life cycleprovides a basic framework for managing the project.At the beginning of the project the staffing levels are low. On an IT project, for example, it is possiblethat the project is staffed with the just a project manager, an architect and couple of developers.Therefore, the cost expended during the initial stages of the project is low. But as the project gets intothe execution phase more developers are added to the team and the costs incurred start increasing. Asthe project approaches closure the costs start going down. This is shown in Figure 8.4 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 515 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 42 & 43

FIGURE 8: Project Life Cycle6At the beginning of the project the uncertainty – and therefore the risk to the project - is the greatest.However, as the project progresses this uncertainty reduces. Similarly, the ability of stakeholders toinfluence changes to the project is the greatest at the beginning and reduces as time progresses. Thesecharacteristics of the stakeholder ability to influence and risks on the project over time are shown inFIGURE 9. FIGURE 9: Stakeholder influence & Risks on projects76 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 397 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 40

Common InputsThe Organization Process Assets and Enterprise Environmental Factors are inputs to a number ofproject management processes in the PMBOK® Guide. These are described briefly here:Organization Process AssetsOrganization Process Assets includes assets of the requesting organization and/or the performingorganization that influence the success of the project. Assets include:Organizations’ Processes and Procedures –Mature organizations have documented policies,standards, guidelines, work practices, templates as well as communication requirements for any projectthat is performed for internal purposes or for clients. These influence the success of projects executedin the organization.Corporate Knowledge Base – This is a repository of data and information of past projects that wereexecuted by the organization. The data and information may be in the form of project documents(requirements documents, design documents, test cases etc.), records and measurements (defect data,issues log, minutes of meeting etc.), financial data (business case document, project selection methodsused, profitability etc.) as well as registers (risk register showing movement of risk over the period ofexecution of the project etc.). This information can be quite handy when project managers embark onnew projects.Enterprise Environment FactorsThese are internal or external factors that influence the success of the project. These include: Regulatory Requirement or Government Standards: E.g. the ISI standards for products in India Organization Structure – We saw how an organization’s structure influences the performance of a project Commercial Databases: These include commercially availability data and information that could help project team estimate the size or effort on a new project, database of risks etc. Risk Tolerances – Stakeholders have varying levels of risk thresholds. A risk-averse stakeholder may have an opposite influence on a project that a risk taker. Personnel Policies – These are guidelines for staffing, training, retaining and exiting staff from an organization. These guidelines definitely have an influence on the project staffing, and hence on the project success. Project Management Software – Availability of tools for scheduling, monitoring progress, reporting is a big factor in managing projects successfully. These tools can help project managers keep their stakeholders up-to-date with the status of the projects.Knowledge Areas in PMBOK® GuidePMBOK® Guide 5th edition has 5 process groups and 10 knowledge areas. We have already seen the5 process groups earlier in this chapter. The 10 knowledge areas are: Project Integration Management Project Scope Management Project Time Management Project Cost Management Project Quality Management

 Project Human Resources Management Project Communications Management Project Risk Management Project Procurement Management, and Project Stakeholder ManagementPMBOK® Guide 5th edition also defines project management 47 processes that are categorized into5 process groups and 10 knowledge areas. FIGURE 10 shows the organization of projectmanagement processes.As mentioned earlier in this book, while PMBOK® Guide 5th edition is organized by knowledge areas,this student guide is organized along the lines of process groups i.e., we will discuss the initiatingprocess group processes first followed by planning process group processes and so on.

FIGURE 10: Process Groups defined in PMBOK®88 Project Management Institute – A Guide to Project Management Body of Knowledge (PMBOK® Guide) – Fifth Edition,Project Management Institute, Inc, 2013. Page 61

Project Management Project management is Application of knowledge, skills, tools and techniques to project activities in order to meet the project requirements. It will require the project manager to select the applicable project processes amongst the 47 processes.