Copyright 2009 John Wiley & Sons, Inc. Chapter 1 Projects in Contemporary Organizations

Introduction Much of project management developed by the military – Navy’s Polaris program – NASA’s space program – Strategic defense initiative Project management has found wide acceptance in industry It has many applications outside of construction – Managing legal cases – Managing new product releases

Introduction Continued Main forces in driving the acceptance of project and other forms of management: 1. The exponential growth of human knowledge 2. The growing demand for a broad range of complex goods and services 3. Increased worldwide competition All of these contribute to the need for organizations to do more and to do it faster Project management is one way to do more faster

Projects Tend to be Large Projects tend to be large – The Channel Tunnel, or Chunnel – Denver International Airport – Panama Canal expansion project – Three Gorges Dam, China Projects are getting larger over time – Flying: balloons  planes  jets  rockets  reusable rockets The more we can do, the more we try to do

Project Management Also Getting Smaller 1. More people are seeing the advantages of project management techniques 2. The tools are become cheaper 3. The techniques are becoming more widely taught and written about

Main Goals of Project Management 1. Time 2. Cost 3. Performance Time, cost, and performance are all related on a project

Direct Project Goals: Performance, Cost, Time Figure 1-1

Project Management Institute (PMI) The Project Management Institute is the major project management organization Founded in 1969 Grew from 7,500 members in 1990 to over 260,000 in 2007 The Project Management Journal and PM Network are the leading project management journals

Project Manager Project manager is the key individual on a project Project manager is like a mini-CEO While project manager always has responsibility, may not have necessary authority

Trends in Project Management Achieving strategic goals Achieving routine goals Improving project effectiveness Virtual projects Quasi-projects

Recent Changes in Managing Organizations 1. Consensual management 2. Systems approach 3. Projects as preferred way to accomplish goals

The Definition of a “Project” Modern project management began with the Manhattan Project In the early days, project management was used mainly for very complex projects As the tools became better understood, they began to “trickle down” to smaller projects It has also moved out of just manufacturing to services

Major Characteristics of a Project Importance Performance Life cycle with a finite due date Interdependencies Uniqueness Resources Conflict

Why Project Management? The main purpose for initiating a project is to accomplish some goal Project management increases the likelihood of accomplishing that goal Project management gives us someone (the project manager) to spearhead the project and to hold accountable for its completion

Negative Side to Project Management Greater organizational complexity Higher probability organizational policy will be violated Says managers cannot accomplish the desired outcome Conflict

The Project Life Cycle Figure 1-3

Time Distribution of Project Effort Figure 1-4

Another Possible Project Life Cycle Figure 1-5

Risk During at the Start of the Life Cycle Figure 1-6

Risk During the Life Cycle Figure 1-7

The Structure of this Text Follows the project life cycle Some topics stand-alone Other topics incorporated throughout

Part I: Project Initiation 1. Projects in Contemporary Organizations 2. Strategic Management and Project Selection 3. The Project Manager 4. Negotiation and the Management of Conflict 5. The Project in the Organizational Structure

Part II: Project Planning 6. Project Activity Planning 7. Budgeting and Cost Estimation 8. Scheduling 9. Resource Allocation

Part III: Project Execution 10. Monitoring and Information Systems 11. Project Control 12. Project Auditing 13. Project Termination