OverviewofProject

IntegrationManagement

ProjectIntegration
Management

ProjectIntegrationManagement
referstotheprocessesrequiredtoensurethatthevarious
elementsoftheprojectareproperlycoordinated.Inshort,it
isthetyingtogetherofalloftheotheraspectsinvolvedina
projecttomakeitasuccess.

OverviewofProjectIntegrationManagement
StrategicPlanningandProjectSelection
ProjectManagementPlan
ProjectExecution
MonitoringandControllingProjectWork
IntegratedChangeControl
ClosingProject

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OverviewofProject
IntegrationManagement

StrategicPlanningand
ProjectSelection

MajorProcessesinvolvedinProjectIntegrationManagement
DevelopmentoftheProjectCharter

Planning Process for IT Projects Selection

creationofadocumentcalledprojectcharter

DevelopmentoftheProjectManagementPlans
documentationoftheactionsessentialindefining,preparing,integration,and
coordinatingallsubsidiaryplans

Directandmanageprojectexecution
carryingouttheprojectplansbyperformingtheactivitiesincludedinit

Monitorandcontroltheprojectwork
continuousmonitoringoftheprojectperformancetoassesstheoverallhealthof
theproject

TieITstrategytomissionandvisionof
organization.Identifykeybusinessareas.

BusinessArea
Analysis

Documentkeybusinessprocessesthat
couldbenefitfromIT.

ProjectPlanning

Definepotentialprojects.
Defineprojectscope,benefits,and
constraints.

ResourceAllocation

SelectITprojects.
Assignresources.

Performintegratedchangecontrol
coordinatingthechangesaffectingtheprojectsdeliverables,organizational
processassets,projectdocuments,andprojectmanagementplan

IT
Strategy
Planning

Closetheprojectorphase
finalizingalltheprojectactivitiestoformallyclosetheprojectorphase.
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Figure 4. 1 Planning Process for IT Projects Selection

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StrategicPlanningand
ProjectSelection

StrategicPlanningand
ProjectSelection

identifyinglongtermobjectivesthroughthefollowing:
analyzingtheorganizationsstrengthsandweaknesses;
studyingopportunitiesandthreatsinthebusinessenvironment;
predictingfuturetrends;and
projectingtheneedfornewproductsandservices.

Methodsforselectingprojects
Focusingonbroadorganizationalneeds
CategorizingITprojects
PerformingNPVorotherfinancialanalyses
Usingweightedscoringmodel
Implementingbalancedscorecard

SWOTAnalysis
Strengths,Weaknesses,Opportunities,andThreats
usedasaidinstrategicplanning
BusinessAreaAnalysis
outlinesdocumentsthebusinessprocessesthatarevitaltoachieving
strategicgoals,andaidsindiscoveringwhichonescouldmostbenefit
fromIT
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Focusingonbroadorganizationalneeds
Topmanagersneedtofocusonachievingthevariousneedsofthe
organizationwhendecidingwhatprojectstoundertake,whento
undertakethem,andtowhatlevel.
Onemethodforprojectselectionbasedonbroadorganizational
needsisdeterminingwhethertheymeetthefirstthreeimportant
criteria:need,funding,andwill.

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StrategicPlanningand
ProjectSelection

StrategicPlanningand
ProjectSelection

CategorizingITprojects

NetPresentValue(NPV)
themethodofcalculatingtheexpectednetmonetarygainorloss
fromaprojectbydiscountingallexpectedfuturecashinflowsand
outflowstothepresentpointintime
ApositiveNPVmeansthereturnfromaprojectexceedsthecostofcapital
thereturnavailablebyinvestingthecapitalelsewhere.

Problems Theseareunwantedsituationsthatpreventan
organizationfromachievingitsgoals.
Opportunities Thesearechancestoimprovetheorganization.
Directives Thesearenewrequirementsimposedbymanagement,
government,orsomeexternalinfluence.

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Determinethecashinflowsandoutflowsfortheproject.
Determinethediscountrate.
Adiscountrate istheminimumacceptablerateofreturnonan
investment.Itisalsoreferredtoasthecapitalizationrateoropportunity
costofcapital.
CalculatetheNPV.
ThemathematicalformulaforNPVis:NPV=t=0n At /(1+r)t wheret=
yearofthecashflows,A=amountofcashfloweachyear,andr=
discountrate.

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StrategicPlanningand
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StrategicPlanningand
ProjectSelection

NetPresentValue
Asimplerwaytousetheformulaistodeterminetheannualdiscount
factor amultiplierforeachyearbasedonthediscountrateandyear
andthenappliesittothecostsandbenefitsforeachyear.

NPVExample

1/(1+r)t

NetPresentValueExample

Discountfactorfor5years:
Year1:1/(1+.10)1 =0.91
Year2:1/(1+.10)2 =0.83
Year3:1/(1+.10)3 =0.75
Year4:1/(1+.10)4 =0.68
Year5:1/(1+.10)5 =0.62
CalculatetheNPVbysummingupthediscountedbenefitsandthediscounted
costs,assumingcostsareenteredasanegativenumber.Thenmultiplythesums
toitscorrespondingdiscountedfactor.

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Figure 4. 2 Example of NPV

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StrategicPlanningand
ProjectSelection

StrategicPlanningand
ProjectSelection
PaybackAnalysis

ReturnofInvestment(ROI)

incomedividedbyinvestment
requiredrateofreturn forprojects

theminimumacceptablerateofreturnonaninvestment

basedonthereturnthattheorganizationcouldexpecttoreceiveelsewhere
foraninvestmentofcomparablerisk
formulasforcalculatingfinancialROIforanITprojectoranyotherinvestment

Paybackperiod istheamountoftimeitwilltaketorecoup
thenetamountinvestedinaprojectintheformofnet
cashinflows.
paybackanalysisdetermineshowmuchtimewilllapse
beforeaccruedbenefitsovertakeaccruedand
continuingcosts
Paybackoccurswhenthenetdiscountedcumulative
benefitsandcostsreachzero.

Thiscanalsobestatedas:
ROI=(PVBenefits PVCost)/PVCost

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StrategicPlanningand
ProjectSelection

StrategicPlanningand
ProjectSelection

PaybackAnalysisExample

PaybackPeriod

Figure 4. 3 NPV Example

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Figure 4. 4 Payback Period

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StrategicPlanningand
ProjectSelection

StrategicPlanningand
ProjectSelection

UsingWeightedScoringModel
Aweightedscoringmodel isatoolthatprovidesasystematicprocessfor
selectingprojectsbasedonvariouscriteria.

UsingWeightedScoringModel

meetingbroadorganizationalneeds;
addressingproblems,opportunities,ordirectives;
theamountoftimeitwilltaketocompletetheproject;
theoverallpriorityoftheproject;and
theprojectedfinancialperformanceoftheproject.

weightsindicatehowmuchyouvalueeachcriterionorhow
importanteachcriterionis

identifythecriteriarequiredtotheprojectselectionprocess:

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assignaweighttoeachcriterion

establishweightsbyassigningpointsordetermine
minimumscoresorthresholdsforspecificcriteriaina
weightedscoringmodel
scoresindicatehowmucheachprojectmeetseachcriterion

Supportforkeybusinessobjectives
Hasstronginternalsponsor
Hasstrongcustomersupport
Usesrealisticleveloftechnology
Canbeimplementedinoneyearorless
Providesapositivenetpresentvalue
Haslowriskinmeetingscope,time,andcostobjectives
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StrategicPlanningand
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StrategicPlanningand
ProjectSelection

WeightedScoringModelExample

UsingWeightedScoringModel

calculatetheweightedscoreforeachprojectbymultiplyingthe
weightforeachcriterionbyitsscoreandthenaddingtheresulting
values

Weighted score for Project 1 is

calculated as:
25%*90+15%*70+15%*50+
10%*25+5%*20+20%*50+
10%*20=56
Figure 4. 5 Weighted Scoring Model Example

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StrategicPlanningand
ProjectSelection

StrategicPlanningand
ProjectSelection

ProjectCharter

ImplementingBalancedScorecard

Drs.RobertKaplanandDavidNortondevelopeda
methodologycalledbalancedscorecard thataidsinthe
selectionandmanagementofprojectsinalignmentwith
thebusinessstrategy.

usedtoconvertanorganizationsvaluedrivers,suchascustomer
service,innovation,operationalefficiency,andfinancial
performance,intoaseriesofdefinedmetrics
themetricswereanalyzedandrecordedbytheorganizations
todeterminehowwelltheprojectshavehelpedthemin
achievingstrategicgoals

formallyrecognizestheexistenceofaprojectandprovidesdirection
ontheprojectsobjectivesandmanagement
allowsaprojectmanagertousetheorganizationalresourcesto
completetheproject
shouldbesignedbykeyprojectstakeholderstoacknowledge
agreementontheneedforandtheintentoftheproject
Inputs,toolsandtechniques,andoutputs
INPUTS

1.
2.
3.
4.

Projectstatementofwork
Businesscase
Contract
Enterpriseenvironmental
factors
5. Organizationalprocess
assets

TOOLS&TECHNIQUES
1. Expertjudgment

OUTPUTS
1. Projectcharter

Figure 4. 6 Project Integration Management Overview

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StrategicPlanningand
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StrategicPlanningand
ProjectSelection

ProjectCharter

ProjectCharter

StatementofWork(SOW) isanarrativedescriptionofproductsandservices
tobedeliveredbytheproject.

Theorganizationalprocessassets thatcaninfluencethedevelopment
ofprojectcharterinclude,butarenotlimitedto:
Organizationalstandardprocesses,policies,andstandardizedprocess
definitionstobeusedintheorganization
Projectcharterstemplates
Historicalinformationandlessonslearnedknowledgebase

referencesthebusinessneed,productscopedescriptionandstrategic
plan

Thebusinesscase isadocumentthatprovidestherequiredinformationfrom
abusinessperspectivetodeterminewhetherornottheprojectisworth
investingfor.

Acontract specifiesiftheprojectisbeingdoneforanexternalcustomer.

Theenterpriseenvironmentalfactors thatcaninfluencethedevelopmentof
projectcharterinclude,butarenotlimitedto:

Expertjudgment isusedtoevaluatetheinputsthatareusedto
developtheprojectcharter.
Theprojectcharter documentspecifiesthefollowing:
businessneeds,
currentunderstandingofthecustomersneeds,and
thenewproduct,service,orresult

Governmentorindustrystandards
Organizationinfrastructure
Marketplaceconditions
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ProjectManagementPlan

ProjectManagementPlan

formaldocumentusedtocoordinateallprojectplanningdocumentsand
helpguideaprojectsexecutionandcontrol
documentsprojectplanningassumptionsanddecisionsregardingchoices,
facilitatecommunicationamongstakeholders,definethecontent,extent,
andtimingofkeymanagementreviews,andprovideabaselinefor
progressmeasurementandprojectcontrol
dynamic,flexible,andsubjecttochangewhentheenvironmentorproject
changes
assisttheprojectmanagerinleadingtheprojectteamandassessingthe
projectstatus
commonelements

Astakeholderanalysis documentsinformationsuchaskey
stakeholdersnamesandorganizations,theirrolesonthe
project,uniquefactsabouteachstakeholder,theirlevelof
interestintheproject,theirinfluenceontheproject,and
suggestionsformanagingrelationshipswitheach
stakeholder.

introductionoroverviewoftheproject
descriptionofhowtheprojectisorganized
managementandtechnicalprocessesusedontheproject
sectionsdescribingtheworktobedone,schedule,andbudgetinformation

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ProjectExecution

ProjectExecution

involvesmanagingandperformingtheworkdescribedinthe
projectmanagementplan

ToolsandTechniquesinProjectExecution

projectmanagerandtheprojectmanagementteamdirectthe
performanceoftheplannedprojectactivities,andmanagethe
varioustechnicalandorganizationalinterfacesthatexistwithinthe
project

Projectmanagementmethodology
followamethodologydescribingnotonlywhattodoinmanaginga
project,buthowtodoit

Themainfunctionofcreatingprojectplansistoguideproject
execution.

Projectmanagementinformationsystems
variousorganizationsareusingpowerfulenterpriseproject
managementsystemsthatcanbeaccessedviatheInternet

Havingagoodplanwouldresulttogoodproductsanditshould
documentthegoodworkresultsincludedinit.
Toimprovethecoordinationbetweenprojectplandevelopment
andexecution,followtherule:Thosewhowilldotheworkshould
planthework.
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MonitoringandControlling
ProjectWork

MonitoringandControlling
ProjectWork

involvesthefollowingtodeterminewhatprocess
improvementscanbemade:

ToolsandTechniquesforMonitoringandControllingProjects
Projectmanagementmethodology
Projectmanagementinformationsystems
Expertjudgment
Earnedvaluemanagement

collecting,measuring,anddisseminatingperformanceinformation;
assessingmeasurements;and
analyzingtrends

Inputsnecessarytomonitorandcontrolprojectwork:
Projectmanagementplan
Workperformanceinformation
Performancereports
Changerequests

Projectperformanceshouldbemonitored
continuouslybytheprojectteamtoassessthe
overallconditionoftheprojectandtoidentify
theareasthatrequirespecialattention.

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Outputs:
Correctiveactions
Preventiveactions

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IntegratedChangeControl

IntegratedChangeControl

identifies,evaluates,andmanageschangesthroughouttheprojectlifecycle

Achangecontrolsystem referstoaformal,documentedprocessthatdescribes
whenandhowtheofficialprojectdocumentsmaybechanged
describesthepeoplewhoareauthorizedtomakechanges,thepaperwork
requiredforthechange,andanyautomatedormanualtrackingsystemsthat
willbeusedbytheproject

Objectives:
Influencingthefactorsthatcreatechangestoensurethatchangesarebeneficial
Determiningthatachangehasoccurred
Managingactualchangesastheyoccur

ChangeControlBoard(CCB)

Outputs:
Inputs:
Projectmanagementplan
Approvedandrejectedchange
requests
Workperformanceinformation(ina
formofperformancereports)
Approvedcorrectiveandpreventive
actions
Requestedchanges
Approvedandvalidateddefectrepair
Recommendedpreventiveand
correctiveactions
Deliverables
Recommendeddefectrepair
Updatestotheprojectmanagement
plan
Deliverables
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formalgroupofpeoplewhoareresponsibleforapprovingorrejecting
changesonaproject
providesguidelinesforthefollowing:
preparingchangerequests
evaluatingchangerequests
managingtheimplementation
ofapprovedchanges

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CCBsconsumetimeinmakingdecisionson
proposedchangesbecausetheyoftenmeet
onlyonceaweekoronceamonthandmaynot
beabletomakedecisionsinonemeeting.

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IntegratedChangeControl

IntegratedChangeControl

ConfigurationManagement
ensuresthatthedescriptionsoftheprojectsproductsarecorrectand
complete,andconcentratesonthemanagementoftechnologyby
identifyingandcontrollingthefunctionalandphysicaldesign
characteristicsofproductsandtheirsupportdocumentation
configurationmanagementspecialistsidentifyanddocument
configurationrequirements,controlchanges,recordandreport
changes,andaudittheproductstoverifyconformancetothe
requirements

SuggestionsforManagingIntegratedChangedControl
Viewprojectmanagementasaprocessofconstantcommunicationand
negotiation
Planforchange
Establishaformalchangecontrolsystem,includingaCCB
Usegoodconfigurationmanagement
Defineproceduresformakingtimelydecisionsonsmallerchanges
Usewrittenandoralperformancereportstohelpidentifyandmanage
change
Useprojectmanagementandothersoftwaretohelpmanageand
communicatechanges

Communication
writtenandoralperformancereportsareusedbyprojectmanagersto
aidinidentifyingandmanagingprojectchanges
standupmeetings areperformedbyprojectmanagersonceaweekto
communicatewhatismostimportantontheproject
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ClosingProjects
Tocloseaproject,alltheactivitiesmustbefinalizedandthe
completedorcancelledworkmustbetransferredtothe
appropriatepeople
MajorOutputs:

Administrativeclosureprocedures
Contractclosureprocedures
Finalproducts,services,orresults
Organizationalprocessassetupdates

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