Project Management in Practice

Fourth Edition
1-1

Mantel, Meredith, Shafer, and Sutton

Prepared by
Scott M. Shafer,
Updated by
William E. Matthews and
Thomas G. Roberts,
William Paterson University

John Wiley and Sons, Inc.

Copyright 2011 John Wiley & Sons, Inc.

Why the Emphasis on Project Management?

1-2

Many tasks do not fit neatly into business-as-usual

Organizations need to assign responsibility and

authority for the achievement of their goals

Copyright 2011 John Wiley & Sons, Inc.

Characteristics of Projects
1-3

Unique
Specific deliverables
Specific due date

Copyright 2011 John Wiley & Sons, Inc.

Other Common Characteristics of Projects

1-4

Multidisciplinary
Complex
Often involve conflicts
Part of programs

Copyright 2011 John Wiley & Sons, Inc.

Trends in Project Management

1-5

Project management techniques

are increasingly used for:

Achieving strategic, routine, and business goals
Improving project effectiveness
Organizing virtual projects
Handling quasi-projects

Copyright 2011 John Wiley & Sons, Inc.

Definition of a Project
1-6

A project is a temporary
endeavor undertaken to create
a unique product or service.

Project Management Institute, 2007

Copyright 2011 John Wiley & Sons, Inc.

Definition of Project Management

1-7

The application of knowledge,

skills, tools, and techniques to
a broad range of activities in
order to meet the
requirements of a particular
project.
Project Management Institute 2007
Copyright 2011 John Wiley & Sons, Inc.

Scope, Cost, and Time Project Performance

Targets
1-8

Copyright 2011 John Wiley & Sons, Inc.

Abilities Needed For Effective Project

Management
1-9

Ability to resolve conflicts

Creativity and flexibility
Ability to adjust to change
Good planning skills
Negotiation skills

win-win versus win-lose

Copyright 2011 John Wiley & Sons, Inc.

The Life Cycle of Projects

1-10

All organisms have a life cycle (i.e., they are born,

grow, wane, and die) and so do projects

Some projects follow an S-shaped curve they start
slowly, develop momentum, and then finish slowly
Other project follow a J-shaped curve they start
slowly , proceed slowly, and then finish rapidly

Copyright 2011 John Wiley & Sons, Inc.

Nonnumeric Selection Methods

1-11

The Sacred Cow- a pet project

advocated by a senior executive of
the firm.
The operating/competitive
necessity
Comparative benefits

Copyright 2011 John Wiley & Sons, Inc.

The Q-Sort Method

1-12

Copyright 2011 John Wiley & Sons, Inc.

Numeric Selection Methods

1-13

Financial assessment methods

payback period
discounted cash flow
future opportunity analysis
Scoring methods
unweighted 0-1 factor method
weighted factor scoring method
Copyright 2011 John Wiley & Sons, Inc.

Payback Period
1-14

Initial Fixed Investment

Annual Net Cash Inflows

Copyright 2011 John Wiley & Sons, Inc.

Discounted Cash Flow

1-15

Ft
NPV (project) - I 0
t
t 1 (1 k )
where
I0 = the initial investment
Ft = the net cash flow in period t
k = the required rate of return or hurdle rate
Copyright 2011 John Wiley & Sons, Inc.

The Weighted Scoring Model

1-16

Si sij w j
j 1

where
Si = the total score of the ith project
sij = the score of the ith project on the jth criterion
wj = the weight or importance of the jth criterion
Copyright 2011 John Wiley & Sons, Inc.

Uncertainties Encountered in Project Management.

1-17

Time required to complete a project

Availability and cost of key resources
Timing of solutions to technological problems
Macroeconomic variables
The whims of clients
Actions taken by competitors

Copyright 2011 John Wiley & Sons, Inc.

Can Uncertainty be Eliminated?

1-18

No uncertainty cannot be

eliminated. However, if managed

properly, it can be minimized

Copyright 2011 John Wiley & Sons, Inc.

Risk Analysis
1-19

Estimate probabilities or distributions

associated with key parameters

Construct a mathematical model of the
situation and run a simulation ... given
various scenarios
Analyze distribution of outcomes generated
by model
Copyright 2011 John Wiley & Sons, Inc.

Risk Analysis with Crystal Ball

1-20

Assumption Cells
Distribution Gallery
Forecast Cells

Copyright 2011 John Wiley & Sons, Inc.

Steps in the Project Portfolio Process

1-21

Establish a project council

Identify project categories and criteria
Collect project data
Assess resource availability
Reduce the project and criteria set
Prioritize the projects within categories
Select the projects to be funded and those

to be held in reserve
Implement the process
Copyright 2011 John Wiley & Sons, Inc.

Categories of Projects
1-22

Derivative projects those that are only

incrementally different from existing offerings

Platform projects major departures from
existing offerings the next generation
Breakthrough projects involving a newer
technology possibly a disruptive technology
R&D projects blue sky or visionary
endeavors
Copyright 2011 John Wiley & Sons, Inc.

Copyright
1-23

Copyright John Wiley & Sons, Inc.

All rights reserved. Reproduction or translation of this work beyond
that permitted in Section 117 of the 1976 United States Copyright Act
without express permission of the copyright owner is unlawful.
Request for further information should be addressed to the
Permissions Department, John Wiley & Sons, Inc. The purchaser may
make back-up copies for his/her own use only and not for distribution
or resale. The Publisher assumes no responsibility for errors,
omissions, or damages, caused by the use of these programs or from the
use of the information herein.

Copyright 2011 John Wiley & Sons, Inc.