Advanced Project Management Level 6 Advanced Project Management

Advanced Project Management Level 6 Advanced Project Management

Session 1 Managing and Leading Projects Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § § § Explore the various definitions and characteristics of a project Analyse the difference between leadership and management relating to projects Explore why organisations in different sectors need to engage in projects and consider different types of project Evaluate the importance and relationship of project and people management in achieving project goals. Demonstrate an understanding of external business environmental factors and how they may affect a project. Critically evaluate the concept of power and influence. Identify the key stakeholders for a purchasing and logistics project and how their power and influence change throughout the life of the project. Advanced Project Management

Definitions of Project Management § ‘… A set of activities with a defined start point and a defined end state, which pursues a defined goal and uses a defined set of resources. ’ (Slack et al) § “. . . A temporary endeavour undertaken to create a unique product or service”. (US PMI) § “. . . The process by which projects are defined, monitored, controlled & delivered. . . desired outcome. . . bring about change” (APM) Advanced Project Management

Definitions § Cips Study Guide § “a group of activities that have to be performed in a logical sequence to meet pre-set objectives outlined by client” § Meredith & Mantel § “a specific, finite task to be accomplished. . . project seen as a unit. . characteristics. . importance, performance, lifecycle, interdependencies, uniqueness, resources and conflict” § What are key features? Group exercise Advanced Project Management

Distinctions between Leadership and Management “Leadership is the lifting of a person’s vision to higher sights, the raising of performance to a higher standard, the building of personality beyond its normal limitations”. “Nothing better prepares the ground for such leadership than a spirit of management that confirms in the day-to-day practices of the organisation strict principles of conduct and responsibility, high standards of performance and respect for the individual and his work. ” Drucker; The Practice of Management Advanced Project Management

What do Managers Do? § § § Plan Organise Coordinate Control Lead § Fayol § Is this mainly a shorter term focus? § Establishing overall purpose or policy § Forecasting and planning § Organising and allocating work § Giving instructions § Checking performance § Coordinating the work of others Buchanan Advanced Project Management

What do Leaders Do? § § Enable people and groups to achieve their objectives Set and communicate objectives Monitor performance and give feedback Establish basic values Clarify and solve problems for others Organise resources § Longer term? § § Advanced Project Management § § § § Administer rewards and punishments Provide information, advice and expertise Provide social and emotional support Make decisions on behalf of others Represent the group to others Arbitrate in disputes Act as a father figure Become a scapegoat

Leader or Manager? § Group exercise § 1 § What do you see as the key differences between management & leadership? § Which skills are more important in project management? § Recap Kotter p 11 – effective v efficient? § Also Mintzberg p 12 Advanced Project Management

Reasons that Organisations Undertake Projects § Change in: § § § The external environment Markets and customer needs Technology Products and services Processes § Globalisation § Impatient customers § Increasing demand for unique and customised solutions § Change within organisations initiated by senior managers § Paired ex – list examples for each point above – own org. or alternative Advanced Project Management

Hard or Soft Projects § Hard – normally refer to tangible, measurable activities and processes § Soft – human factors and processes – eg communication, behavioural change and acceptance § Can you easily distinguish simply between these two aspects of project work § Is Millau Bridge a hard project? Advanced Project Management

‘Hard’ vs ‘Soft’ Projects § § § § § Product development – p 8 Process development – eg BPR Re-design/modification of products and processes Technology development Installation of new IT systems example p 9 – London Ambulance Service Site relocation/closure Culture change Introduction of a new organisational structure A new appraisal scheme How would you categorise each of these? Advanced Project Management Lyson’s categorisation of projects: § Manufacturing projects § Construction projects § Management projects § Research projects § Too simplistic?

Constituents of the Project Context § PEST/SLEPT factors § Porters 5 Forces analysis § Stakeholders § Resource constraints § Time constraints § Overall strategy of the organisation CIPS syllabus Advanced Project Management § § Complexity Completeness Competitiveness Customer focus Maylor

Common Stakeholder Expectations § § § § § Fit for purpose Aesthetically pleasing Free from defects Delivered on time Value for money Reasonable running costs Satisfactory reliability/durability Supported by worthwhile guarantees Which stakeholders do each of above relate to? Advanced Project Management

Stakeholder Power/Interest Matrix Level of interest Low High Minimal effort Keep informed High Power Low Keep satisfied Key players Source: Mendelow, 1991 Advanced Project Management Stakeholders are likely to move between segments during the life of a project

How do you keep stakeholders satisfied? § Satisfaction = perception – expectation § Manage their expectations § Re projects – may be necessary to “sell” the final outcome § Ensure know actual requirements – don`t over-promise § Keep advised of progress § Spec exam paper – Sportsco Q 1 Advanced Project Management

Session 2 Managing and Leading Projects Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § Evaluate and explain the idea of the project as a conversion or transformation process. Explore the concept of variety and volume in defining the nature of an operation and evaluate its application to project management. § Describe the role of a project selection Advanced Project Management

A Project is a Conversion Process Input resources Materials Information Customers Input resources Input transforming resources Facilities Staff Advanced Project Management The project (transformation process) Output (product/ service) Customers

Conversion Process Inputs Transformed into Outputs Same as a process? What other input resources do you need? See p 30 Advanced Project Management

Projects as a Technology Volume High Projects Small batch Low Variety High Low Advanced Project Management Large batch Process plant

The Project Model Constraints: • Financial • Legal • Ethical • Environmental • Logic • Activation • Time • Quality • Indirect effects Input: Want/need Project Mechanisms: Advanced Project Management • people • knowledge & expertise • capital • tools & techniques • technology Output: satisfied need

Project Constraints Group exercise Discuss examples and give reasons why Maylor lists these factors - in previous slide as constraints in his ICOM model Advanced Project Management

Project Portfolio Process § How many projects can an organisation handle? § Identify projects that satisfy strategic needs § They support multiple goals – feasible? § They drive organisational improvement – why might these take priority? § They enhance/enable ‘key areas’ – how determine? Advanced Project Management

Portfolio Process § Prioritise candidate projects § Limit active projects to a manageable level – do you always have necessary resources? § Identify risk-intensive efforts – why? § Balance short-, medium- and long-term returns – why is this important? § Prevent projects getting in the back door – how/why might this happen? Meredith & Mantel, 2005 Advanced Project Management

Project Selection Factors Issues to Consider § Operations § Interruptions, learning, process § Marketing § Customer management issues § Financial § Return on investment – what is acceptable? § Personnel § Skills and training, working conditions – what impact on employee motivation? § Administrative § Regulatory standards, ‘strategic fit’ – with what? Meredith & Mantel, 2005 Advanced Project Management

Strategic Success Factors § Project mission – clearly defined and agreed objectives § Top management support – top managers must get behind the project and make clear to all personnel at the outset their support § Project action plan – showing details of the required steps and resource requirements in the implementation process § Group ex – how would getting each of these factors wrong cause problems for an organisation? Can you think of any project failures attributable to any of these factors? Advanced Project Management Meredith & Mantel, 2005

What Projects Have in Common § An objective or objectives, usually defined in terms of quality, time and cost – the “iron triangle” § Each is unique – a ‘one-off’ – always? § Of a temporary nature – what is temporary? § A degree of complexity, stemming from multiple tasks and participants – often the key challenge § A degree of uncertainty, often technical NB. A ‘programme’ implies greater longevity or continuity § Spec Exam paper Q 3 Advanced Project Management

Session 3 The Project Life Cycle Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § Consider different approaches to the project life cycle Identify the different stages of the project life cycle and the key characteristics, demands and problems most likely to be encountered at each stage Evaluate the concept of the project life cycle as a management tool Investigate a variety of problem-solving approaches and the extent to which they may be relevant during the project life cycle Advanced Project Management

Comparison of Characteristics of Projects and Problems Projects § A supported purpose/ importance § Specifications of performance (form, fit, function) § Known solution § Stages with finite due date § Interdependencies § Uniqueness § Resource requirements and tradeoffs § Stakeholder conflict Meredith & Mantel, 2005 Advanced Project Management Problems § Intransparency – lack of clarity of situation § Polytely – multiple goals § Complexity – large numbers of items, interrelations and decisions § Dynamism – time considerations

Three-stage Project Life Cycle Source: Meredith & Mantel, 2003, Wiley Advanced Project Management

Three Stage Life Cycle § Why might work in project follow this guideline? § Any examples? – construction of new housing estate § Consider time/effort impact – fig 4. 2 p 39 § Alternative patterns? See p 40 § Why is it important to know what is likely scale of progress? How identify in advance? § Group ex – look at p 42 – relative importance of project objectives – agree? Advanced Project Management

Four-stage Project Life Cycle D 1: Define the project The brief D 2: Design the project process Process & product knowledge D 4: Develop the process The proposal/PID The outcomes D 3: Deliver the project Source: Maylor Advanced Project Management

Maylor’s Four-phase Approach Phase Key issues Key questions Define the project Organisational & project strategy; goal definition What is to be done? Why is it to be done? Design the project process Modelling & planning; estimating; resource analysis; conflict resolution; business case How will it be done? Who will be involved in each part? When can it start and finish? Deliver the project Organisation; control; leadership; decisionmaking; problemsolving How should the project be managed? Develop the process Assessment of process & outcomes; evaluation; changes for the future How can the process be continually improved? Advanced Project Management

Developing a Project Strategy Getting started Moving forward Bringing it in Handing it on Analysis Commitment Consultation Preparation Feasibility trials Doing the work Making the change Handover Support Review Source: CIPS Advanced Project Management

4 Stage Models § Group exercise § Compare and contrast Maylors 4 stage model to Cips version on slide – also use Cips version p 45 – table 4. 4 § Are they effectively one and the same – or are there genuine differences? Advanced Project Management

Five-stage Project Life Cycle Stage 1 Weiss & Wysocki Define Stage 2 Plan Stage 3 Changes Corrective action Organise Stage 4 Stage 5 Control Advanced Project Management Close Out

5 Stage Models § See also Frigenti and Comninos model – p 45/6 § Tables 4. 5 and 4. 6 p 46 – individual homework exercise – critically evaluate these 2 models, recommending your preferred option for use in your organisation Advanced Project Management

Mc. Kinsey’s 7 S Framework Strategy Structure Systems Shared purpose Style/ culture Staff Skills Advanced Project Management Source: Mc. Kinsey 7 S framework

The 7 S Project Approach Element Description Strategy High-level requirements of the project and means to achieve them Structure Organisational arrangements that will be used to carry out project Systems Methods for work to be designed, monitored and controlled Staff Selection, recruitment, management and leadership of those working on project Skills Managerial and technical tools available to project manager and staff Style/culture Underlying way of working and inter-relating within the project/organisation Stakeholders Individuals and groups who have an interest in project process or outcome Advanced Project Management Source: 7 S framework adapted by Maylor

7 S Framework § This is a more strategic approach to Project management – focuses upon strategic alignment and “fit” § Considers organisations capabilities, capacity, priorities and strategic objectives. § Does project fit or match these areas? § Consider impact of project on other activities and areas of the organisation – resources, culture etc Advanced Project Management

Problem Solving Techniques § § § § § Maylor Thamhain & Wilemon Thomas-Killman Conflict Resolution Brainstorming Ishikawa Fishbone Analysis Cause – Effect – Cause Analysis Decision Trees Pareto Analysis 5 Whys Lewins Force Field Analysis Advanced Project Management

Systematic Problem-solving Model Problem identification Seek alternative definitions Select solution Implement Select definition Evaluate possible solutions Advanced Project Management Check and amend Source: Adapted from Maylor

Thamhain & Wilemon § What are main causes of conflict in projects? § Group exercise – prioritise from following; § Cost, Personalities, Priorities, Procedures, Schedules, Staffing, Technical Problems § At what stage will some be more significant than others – use 4 stage approach – formation, early implementation, main programme, closing. Advanced Project Management

Thomas-Killman Model § § § 5 Approaches to conflict resolution Avoiding – what? When use? Forcing – what? Accommodating – why? Compromising – isn`t this always the best way? § Collaborating – how does this work? § Is it horses for course approach? Advanced Project Management

Brainstorming § Purpose § To generate a large number of ideas § To stimulate creativity § Technique § The ‘problem’ to be solved is described or stated § Everyone participates, either in turn or simply by calling out in an orderly way § A team member captures everything as said on paper/board § No judgement or criticism of others’ suggestions: the group accepts outrageous, unrelated ideas § Ideas are developed by building on others’ ideas § When there are no more ideas, the exercise is over What are difficulties of using this technique in work environment? Advanced Project Management

Ishikawa Fishbone Analysis § Purpose § To visually represent in specific categories the probable causes of a problem § To help people visualise a problem and structure its analysis § Process § Identify the ‘problem’ and place it in the ‘Effect’ box. § Trace the process through all stages to identify all possible contributory causes. Use the Brainstorming technique to consider all the possible causes that may result in the ‘Effect’. § Group possible causes under headings (for example, the 4 Ms: Methods, Manpower, Materials, Machines; or steps in the process being analysed). Advanced Project Management

Example of Fishbone Diagram MACHINERY MANPOWER Insufficient space at locations Mixed or misplaced stock Incorrect tube pattern Labelling on lowest rack No stock stickers Loose components Loose end stops Uneven tube lengths MATERIALS Advanced Project Management Incorrect quantity at location Counting EFFECT Error in item stock control Poor quality staff training Consecutive rack numbering Excessive movements Poor procedures Returns METHODS

Cause-effect-cause Analysis § Purpose § To overcome stagnation in solving problems that are complex and difficult to structure § To identify the root cause of a problem § Technique § Best results emerge when a skilled facilitator is available § State the problem and identify the effects § Explore how the effects relate to one another § Use ‘why’ and ‘how’ successively to explore causes of the observed effects § Form a cause-effect diagram on which action can be taken – see p 59/60 Advanced Project Management

Decision Trees § Purpose § To identify likely outcomes and probabilities in a problem § To calculate the expected value of possible outcomes § Technique § Identify the scope of the decision to be taken § Identify sub-decision points § Identify the outcomes and probabilities possible from each decision point § Calculate the expected values for specific routes through the tree § May 07 Exam paper Q 5 Advanced Project Management

Session 4 Contemporary Approaches to Managing Projects Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § Explain the 6Σ approach and what it seeks to achieve Identify the eight key processes and requirements of PRINCE 2 and evaluate the effectiveness of this approach to project management Analyse the key requirements of Critical Chain and explain how projects that use CCPM can achieve better results than other methods Explain concept of theory of constraints Advanced Project Management

Six Sigma § A continuous improvement method – Motorola, 1986 § Since applied and popularised by others, for example, GE and Honeywell § Aim – § To profitably improve the quality of products and services to the customer § Statistically, a defect rate = 3. 4 defects per million opportunities – 99. 9997% perfect § Is this always appropriate? § Requires major investment in time and resources Advanced Project Management

Six Sigma § Key characteristics: § Focuses on the customer's critical-to-quality needs (CTQs) – V. O. C. - what are they? How establish? § Concentrates on measuring product quality and improving process engineering § Gives top-down, project-driven process improvement and cost savings § Is a business strategy execution system and so is truly cross-functional § Provides focused training with verifiable ROI § Is business results oriented §Advanced Has Project 3 key. Management component areas – Process Improvement, Process Design (Redesign), Process Management

Process Improvement - DMAIC Define … the project goals and customer deliverables Measure … the process to determine current performance Analyse … and determine the root causes of defects Improve … the process by eliminating defects Control Advanced Project Management … future process performance so that improvements can be sustained

Process Design (Redesign) DMADV § Define – Id and set goals § Match/measure – benchmark against customer needs/expectations § Analyse – performance measurements & outline enhanced processes to meet customer needs § Design/implement – new processes in detail § Verify – controls to ensure compliance Advanced Project Management

Process Management § Changes how organisation is structured and managed § 4 Steps are ; § 1) Understanding processes and customer expectations § 2) Continual measurement § 3) Analysis of data § 4) Responding to variances § Is 6 Sigma a project management tool? Advanced Project Management

Benefits of Six Sigma Direct benefits Indirect benefits § § § § decrease in defects reduced cycle time lower costs to provide goods and services. data-based decisions sustained gains and improvements better safety performance fewer customer complaints Advanced Project Management § § § improved customer relations and loyalty team-building effective supply chain management increased margins greater market share world-class standard development of staff skills

Statistical Basis of Six Sigma Advanced Project Management

Prince 2 § Originated by UK Gov in 1989 – Prince 2 - 1996 § Designed for public sector I. T. Projects § Now generic approach for all types of project § 8 stage model – see Fig 6. 1 page 67 and note the 8 inter-reacting stages plus external stage of Corporate Management –goup ex – read and evaluate Advanced Project Management

PRINCE 2 (Projects In Controlled Environments) Key processes Project management § § § § § Directing the project Planning a project Starting up a project Initiating a project Controlling a stage Managing product delivery Managing the stage boundaries Closing a project Advanced Project Management Project Board: § Project assurance § Project support § § Project manager Documentation: § Quality log § Issues log § Risk log § § Bureaucratic controls Emphasis on early conflict resolution

Prince 2 § Group exercise § What are advantages and criticisms re this approach? § See p 69 – agree with OGC claims? Advanced Project Management

Critical Chain § Traditional project estimation techniques ineffective: § Time and resource constraints usually violated, for example, • People have to multi-task – see p 71 • General Uncertainties • Departments include safety margins • Parkinsons Law • Goldratt – pass on delays but not advances • ‘Student syndrome’ (last minute) § So, PMs rely on ‘padding’ of schedules and budgets to provide slack § Unknown nature of event interaction § Maylor, 2003, Meredith & Mantel, 2005 Advanced Project Management

Theory of Constraints Approach § Project cannot move faster than slowest process – “convoy effect” or “weakest link” § Approach is to manage bottlenecks (constraints) § Activities with several predecessors and/or successors § Add ‘time buffers’ at bottleneck events • ‘Safety stock’ has equivalent in manufacturing • ‘Just-in-case’ equivalent to JIT • Statistically-derived ‘path buffers’ § Establish the critical chain for scarce resources § Prioritise resources in chain events Meredith & Mantel, 2005 and Goldratt’s ‘Theory of Constraints’ Advanced Project Management

Constraints 2 – see p 72/73 § Main stages of the TOC approach: § Identify the constraint (critical path/critical resources) § Exploit the system constraint – ie work it to its maximum capacity § Subordinate everything to the constraints § Elevate the constraint – find additional resources for it § Go back and find new constraints § May Exam Case Study Q 1 Advanced Project Management

Session 5 Exploring the Stages of a Project Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § § § Identify and explain key stages in a typical project. Explain the tasks during project initiation and definition Explain what is involved in developing a project plan and budget and in evaluating project risk Explain how a project might be structured and resources recruited, organised and allocated Identify key methods of measuring and controlling project performance and recommend an appropriate approach for a project Explain what is involved in the closure of a project Explain what is involved in the review and evaluation of a project and the learning stemming from it Advanced Project Management

Stages of a Typical Project 1. 2. 3. 4. Initiation and definition Planning Organisation and implementation Measurement, monitoring, control and improvement 5. Closure 6. Review, evaluation and learning Not directly comparable with earlier examples of life cycle models Lysons Advanced Project Management

Stage 1 – Initiation and Definition What’s involved § § Identifying project goals Listing project objectives Determining preliminary resources Identifying assumptions and risks Tools & techniques § § § Financial appraisal Project initiation document (PID) Quality Function Deployment Risk analysis & risk/impact matrix Suitability/feasibility/vulnerability Voice of the customer Advanced Project Management

Stage 1 § Needs to consider; § Project selection – “sacred cow”, operating necessity, competitive necessity, product line extension, comparative benefit – what do these mean? § Numerical selection methods – unweighted factor (how many boxes does it tick), unweighted factor scoring ( what marks does it score in each box), weighted factor score (which boxes are more important) § See P 79 - discuss Advanced Project Management

Stage 1 - continued § § § Scope/outcomes – what is excluded? Timing Resources – what types? What R. O. I? Resources. Cashflow Risk Impact – how? Likelihood/impact V. O. C. – remember 6 sigma Advanced Project Management

Stage 2 – Project Planning What’s involved § § § § Tools and techniques § Project initiation document (PID) § Work breakdown structure – what/who/where/when § Network diagrams and CPA § QFD § Risk analysis & risk/impact matrix § SIPOC – see session 7 Advanced Project Management Identifying activities Estimating time and cost Sequencing activities – why important? Identifying critical activities Refining the plan Updating the initial risk analysis Writing the project proposal

Stage 2 § § What will be involved? Range and scope Sequence – often critical – why? Why written plan? How used? Project creep § Timing & Costs – assess spending against likely achievements not time spent on activity – why? § Budgets – top down/bottom up? § Use of Critical path analysis – significant aspect at this stage – why? Advanced Project Management

Stage 3 – Organisation and Implementation What’s involved § Determining personnel needs Tools and techniques § § Recruiting the project manager Recruiting the project team Organising the team Assigning work packages § § § Network diagrams and CPA Seven tools of quality control Problem-solving tools Risk analysis & risk/impact matrix Team roles (Belbin) Advanced Project Management

Stage 3 § How project team is set up! How does existing organisational structure impact upon this? § Group exercise - What attributes do we need on the team? § Where do Belbin, Tuckman, Maylor models fit in this aspect of project management? § Cross functional teamworking – issues, problems Advanced Project Management

Stage 4 – Measurement, Monitoring and Improvement What’s involved § Defining management style Tools & techniques § § Establishing control tools Preparing status reports Reviewing the project schedule Issuing change orders § § SIPOC Problem-solving tools Seven quality tools QFD Advanced Project Management

Stage 4 § Consider both Organisation & Project Team Structure § What is appropriate management style – vary depending on project type/nature? § How control project? – which methods? § Reporting process – to whom? § Deadlines – key stages § How/when review/evaluate progress? § How communicate change? § Important at this stage to refer back to original proposal – why? Advanced Project Management

Stage 5 – Closure of the project What’s involved § Obtaining client acceptance § Installing deliverables § Documenting the project § Issuing the final report Tools and techniques § SIPOC § Seven quality tools Advanced Project Management

Stage 5 § § § § § Have we met project aim? V. O. C. Implement project – do it! Does it work? Why record the process used? Learning is crucial – can be more important than project itself? Why? Report – to who? Finality Team feedback Closure Advanced Project Management

Stage 6 – Review, Evaluation and Learning What’s involved § Conducting a project audit § Learning lessons (from successes and failures) § Communicating the review, evaluation and learning Tools and techniques § SIPOC § Seven quality tools (including cost of quality) § Project review Advanced Project Management

Stage 6 § Audit process – did we achieve success? § Who audits? Internal? External? § Audit only at end of project? § Is on-going audit preferable? Why? § What are problems/drawbacks re auditing? § Learning – Kolbs learning cycle § Spec exam paper Q 4 Advanced Project Management

Session 6 Tools & Techniques for Data Collection, Analysis and Decision Making Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § Utilise a range of tools and techniques to assist in data collection, analysis and decision-making: § Appraise appropriateness, selection and implementation of the tools and techniques available to the project team Advanced Project Management

Project Management Tools § § § § § Seven tools of quality control Financial appraisal Voice of the customer Quality function deployment Project initiation document (PID) ‘Moments of truth’ Risk analysis and assessment (risk mitigation) Risk/Impact matrix Suitability/feasibility/vulnerability Advanced Project Management

Evaluating PM Tools and Techniques § Appropriateness § Show that you can pick the right tool for the task § Selection § Show that you are aware of the limitations, as well as its capabilities § Implementation § Show that you can use the tools correctly Advanced Project Management

Ishikawa 7 Tools of QC § Flowcharts – graphical depiction of process § Check sheets – simple log of occurrences of specific event/problem § Pareto § Fishbone diagram § Histogram – bar chart – shows data in grouped frequency distribution § Scatter diagram – eg correlation between advertising spend and sales § Statistical Process Control charts – control limits re acceptable performance/tolerances Advanced Project Management

Risk Assessment § What is the situation to be assessed? § What can go wrong? (What are the hazards? ) § What is the probability that each hazard will occur? § What are the consequences if it does go wrong? § What is the uncertainty of our risk assessment? § Summary – probability, impact and uncertainty § Recommendations Advanced Project Management

‘Risk’ vs ‘Uncertainty’ § Risk – When the decision maker knows the probability of each and every state of nature and thus each and every outcome. An expected value of each alternative action can be determined § Uncertainty – When a decision maker has information that is not complete and therefore cannot determine the expected value of each alternative Meredith & Mantel, 2005 Advanced Project Management

Financial Appraisal § Payback period – time to recover initial investment through estimated cash inflows from the project § Average rate of return (ARR) – average annual profit ÷ average investment § Discounted cash flow (DCF) – present value method § Internal rate of return (IRR) – rate of return that equates present value of cash inflows and outflows § Profitability index – NPV of all future expected cash flows ÷ initial cash investments Advanced Project Management

Quality Function Deployment § QFD = VOC § Final design/outcome = customers needs § See p 109/110 for worked example Advanced Project Management

Service Quality ‘Moment(s) of truth’ § An interaction with a customer § SAS in 1980 s: § Average passenger was in contact with five SAS staff per trip § Five million passenger journeys a year § 25 m opportunities a year to satisfy or dissatisfy customers Dimensions of service quality § Access § Communication § Competence § Courtesy § Credibility § Reliability § Responsiveness § Security § Understanding § Tangibles Parusuruman, Zeithaml & Berry Advanced Project Management

Risk/impact Matrix Impact High Probability High Low Tolerance threshold (depends on organisation) Advanced Project Management

Session 7 Systems and Processes in Project Management Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § § Demonstrate the approach of systems thinking and process focus using process mapping techniques and procedures Explain end-to-end processes Construct a flow chart for a process Explain the interfaces and swim lanes Explain the workings of critical chains software and its impact on projects Appraise appropriateness, selection and implementation of the systems and process techniques available to the project team Advanced Project Management

SIPOC Mapping Suppliers Inputs Advanced Project Management Process Outputs Customers

Flow-charting Processes § Purpose § To describe the ‘flow’ of a process § Process § Identify the process to be charted. It should have defined inputs and outputs and an ‘owner’. § Define the start and end of the process with a circle or oval. § Identify the major steps and represent each with a rectangle. Start the description of each step using a verb (doing word), for example, measure diameter, collect from stores. § Show decisions as a diamond with no more than two outcomes (for example, ‘yes’ and ‘no’) § Represent the flow through the process with lines, using arrows where necessary for clarification, for example, up-arrow where flow returns to a previous step. Advanced Project Management

Work Breakdown Structure § Lists tasks to be completed – assigns responsibility for each task § Can`t eat an elephant § Supported by Linear responsibility chart – who “owns” task and where cooperation between depts or individuals is required § Gantt Charts – measures actual and planned progress – quickly highlights overruns – resource planner – even out demand for resources Advanced Project Management

Interfaces and Swim Lanes § Activities organised into channels – each one representing the responsibilities of individual, dept or organisation § Highlight processing gaps and inefficiencies § Focus attention on high-risk areas where work is transferred between groups – the interface § See p 135 Advanced Project Management

Critical Path Analysis § Use Profex p 114 – 118 § Worked example § Crashing the project § Pert – use of estimates of likely duration of activity, optimistic estimate and pessimistic estimate to calculate mean time and standard deviation re activity. § Then use of probability statistics to estimate likelihood of over-runs § Gert – uses concept that some activities may fail & need repeating – use of statistics to estimate likely occurrence and costs of such events Advanced Project Management

Session 8 Techniques for Purchasing and Logistics Projects Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § Identify a range of purchasing and logistics projects Identify characteristics that differentiate these projects from projects in other functional areas Apply and appraise the usefulness of standard project management tools and techniques for purchasing and logistics projects Apply computerised project management systems for purchasing and logistics projects Advanced Project Management

Examples of P and S Projects § Group exercise – what projects are currently running in your org purchasing function? § What is your involvement? § What are key objectives? § What are main difficulties and constraints? Advanced Project Management

Characteristics of P and S projects § § § § § Specific Time Constrained Limited Resources Cost Reduction Product performance Overcoming reluctance to change by internal stakeholders Including int. Stakeholders in project – getting their commitment Accessing variety of data – internal & external Securing significant “added value” for org. Develop good external relationships with suppliers Advanced Project Management

Managing P and S Projects § Group exercise § Applying concepts and models – which of those examined so far do you use in your organisation? § Applying tools and techniques – which work best in your org? § Applying software – which do you use? How effective is it? What are advantages? See next slide Advanced Project Management

Software Systems Provide support in: § Tracking contracts § Tracking responsibilities § Tracking activities § Communicating § Integrating § E-tendering Advanced Project Management Evaluation criteria § The nature of the products § Ownership of the code § Stability of requirements § Software maintenance and development

Software Systems § Group exercise § What are main benefits in using software packages for running projects? § What are the disadvantages? Advanced Project Management

Session 9 Key Factors in Successful Project Management Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § § § Evaluate the elements of the ‘iron triangle’ and their interdependency Contrast the ‘iron triangle’ approach with the contingency and critical chains (‘crashing’) approaches Analyse and identify process-based factors in the success and failure of purchasing and logistics projects Explain the requirements of effective project leadership Appraise the qualities and characteristics of a successful project manager Analyse and explain the characteristics and importance of teamwork in a project Analyse the extent to which people management and leadership issues contribute to success and failure in projects Advanced Project Management

The ‘Iron Triangle’ Quality Constituents of objectives: • Purpose • End result • Success criteria Cost Advanced Project Management Time

Iron Triangle § § § Standard idea Simple concept Relatively simple factors to measure Relevant for all projects – at least in part Need to clarify objectives of each clearly at outset § Fundamental to negotiations § However – remember targets will probably change during project lifetime Advanced Project Management

Contingent Approaches - no one “best way” – “it depends” § Developed during the 1990 s to overcome weaknesses in the previous ‘one best way’ approach § Loose framework of approaches – use most suitable for the circumstances § Emphasise and cater for: § Strategic context of projects with their wide range of stakeholders § Developments in technology § New management methods, for example, virtual teams § Development of more capable PM software Advanced Project Management

Contingency approach 2 § Project managers integrate: § Resources § Knowledge § Processes § Means using one approach (or more) appropriate to the circumstances (contingencies) Advanced Project Management

‘Crashing’ Project Float § ‘Crashing’ is the process of reducing time spans on critical path activities so that the project is completed in less time § Usually involves greater cost: § Effect: Cost § Overtime working § Allocating additional resources § Subcontracting Advanced Project Management Time

Responsibilities of a Project Manager § Responsibility to the parent organisation § Responsibility to the client § Responsibility to the team members § “Above all, the PM must never allow senior management to be surprised” – § Being prepared to give ‘bad news’ Meredith & Mantel, 2005 Advanced Project Management

Key Activities of Project Managers § Shaping goals and objectives – project goal inevitably changes § Obtaining resources – easy? § Building roles and structures for their team – “followers make their leader” § Establishing good communications § Seeing the whole picture –strategic vision § Moving things forwards (especially in difficult circumstances) - driver Advanced Project Management

Role and Skills of the Project Manager § Background and experience relevant to needs of project § Leadership and strategic expertise for the ‘big picture’ § Technical expertise for sound decisions – always? § Interpersonal competence and people skills to champion, communicate, facilitate, motivate, and so on § Proven managerial ability for getting things done Weiss & Wysocki Advanced Project Management

Skills § “He who has not walked the road, does not know the potholes” – Confuscius § Group exercise § Agree with Confuscius? § What other skills does project manager need? Advanced Project Management

Factors Affecting the Project Manager’s Role and Style § § Nature of the task Organisational structure Organisational culture Individual motivations of the team members Style: Cooperation ↔ Coercion Maylor Advanced Project Management

Four Roles for Project Managers § Leadership – the vision and style § Motivation – managing expectations and rewards § Team building – skills mix and cooperation between members § Communication – different aspects and different stakeholders Advanced Project Management

Project Teams § Personality theories, for example, Belbin based on: § § Intelligence (high/low) Dominance (high/low) Extraversion/introversion Stability/anxiety § Team activities § Team dynamics § Content – what the team does § Process – how the group works • Task processes • Maintenance processes § § § Forming Storming Norming Performing Mourning Advanced Project Management

Project Teams § Teams make projects succeed – agree? § § § Who is in team? Temporary? Cross functional Conditional Crisis? Virtual teams? – core – peripheral team members Advanced Project Management

Belbin’s Team Roles Implementor Organising; practical Inflexible Coordinator Welcoming; strong sense of objectives Ordinary intellect or creativity Shaper Drive Prone to impatience and provocation Plant Genius Up in the clouds Resource investigator Knows ‘a man who can’ Soon loses interest Monitor evaluator Judgement; critical reasoning Unimaginative; not inspirational Teamworker Promotes team spirit Indecisive Completer/ Finisher Perfectionist Tends to worry about nothing Specialist Technically specialised Uninterested outside own area Advanced Project Management

Dimensions of Project Success § Efficiency – meeting the budget and schedule § Customer impact/satisfaction – complex to define and evaluate – what is their perception of success/failure? Does it match yours? § Business/direct success – delivering a result for the business § Future potential – again, somewhat difficult and nebulous to ascertain Meredith & Mendel, 2005 See also work of Westerveld – Profex p 180 para 1. 10 Advanced Project Management

Critical Success Factors in Projects § Clearly defined goals § Competent project manager § Top management support § Competent project team members § Sufficient resources allocated § Adequate communications § Control mechanisms § Feedback capabilities § Responsiveness to clients § Troubleshooting mechanisms § Project staff continuity § See p 158 – slight variance Pinto & Slevin (1987) in Slack, Chambers & Johnston Advanced Project Management

Critical Success Factors § § § § Westerveld Leadership & Team Policy & Strategy Stakeholder management Resources Contracting Project management itself – scheduling, budgeting etc § P 180 para 1. 11 Advanced Project Management

Ten Ways Projects may Fail 1. Failure to appreciate the impact of a multi-project environment on single project success 2. Irrational promises made due to a failure to take into account the variable nature of task performance 3. Irrational promises made due to a failure to take into account the statistical nature of project networks 4. Insufficient identification of dependencies 5. Focus on, and active management of, only a portion of what should be the full project Advanced Project Management 6. Reliance on due-date and wasting of any safety included in the project 7. Wasting of resources through sub-optimal utilisation 8. Wasting of the ‘best’ resources through overuse, multi-tasking and burn-out 9. Delivering original scope when conditions/needs change OR accepting changes to scope without sufficient impact analysis 10. Multi-tasking Group ex – what others can you add?

Project Failure § Consider Greer – p 159 table 11. 4 § Do you agree with these? § Are they more logical than those selected on previous page? Advanced Project Management

Session 10 Project Management and Strategic Practice Advanced Project Management

Learning Outcomes At the end of this session candidates will be able to: § § § § Critically evaluate the key characteristics of the various forms of organisation structure and culture and their consequences for project management Explain the key factors for consideration in choosing the best organisational structure for a project Critically evaluate the use and value to organisations of project management maturity models Evaluate the relationship between the business excellence model and the project management excellence model Understand explain what is meant by knowledge management and organisational learning Demonstrate the strategic benefits and advantages gained through knowledge management and organisational learning Appraise the impact of a organisational learning on the management of projects in purchasing and logistics Advanced Project Management

The Functional Structure Advantages § The owning division should have the relevant expertise § Specialists can share their knowledge and overtime expertise accumulates § It provides a clear sense of ownership and ensures continuity Advanced Project Management The project Disadvantages § It may engender a ‘silo’ mentality. Other specialists may not be consulted § Routine work may take precedence over the project § Motivation may suffer if the project is perceived as a professional diversion

The Project Structure Project A Project B Project C Advantages § Manager has full authority over the project with senior management backing § Grouping necessary resources in the project ensures rapid decision making § Relevant expertise is drawn from other parts of the organisation § The project team has a strong sense of identity and common purpose Advanced Project Management Disadvantages § § § It is suitable only for larger projects as it is expensive to resource Isolationism can develop leading to an ‘us’ and ‘them’ culture Team members may lack technical expertise or understanding of user needs

The Matrix Structure The project Advantages § An individual project manager takes responsibility, usually with strong senior management support § Relevant resources are allocated as required, giving flexibility as well as expertise Advanced Project Management Disadvantages § Decision-making power may still reside outside the project team § Members are likely to be working only parttime on the project and have at least two managers, which may cause anxiety § There may be a high level of competition and in-fighting for resources

What is Organisational Culture? ‘The deeper level of basic assumptions and beliefs that are shared by members of an organisation, that operate unconsciously and define in a basic taken-for-granted fashion an organisation’s view of itself and its environment’ E. Schein (quoted in Johnson & Scholes) Advanced Project Management

A Typology of Culture Type of culture Representation Power A web – spider – power from the centre Role A Greek temple – columns – highly defined structure – large, hierarchical orgs Task A net or matrix – suit project/problem solving teams – power from knowledge People A cluster – members superior to the org. Source: Handy, Understanding Organisations Advanced Project Management

Culture and Management Approaches Characteristic of culture Impact on management style Anglo-Saxon cultures Delegation a preferred managerial style Highly centralised authority It is PM’s responsibility to seek out information International culture PM cannot count on being voluntarily informed of problems by subordinates Highly structured social classes Participative management is difficult to practise; there is an assumption that the more educated, higher-class manager’s authority will be denigrated by using a participative style Highly structured social system The less direct managerial communication tends to be Advanced Project Management Adapted from Meredith & Mantel, 2005

Culture § Group exercise § Why is it important for a project manager to be aware of cultural issues within an organisation? Advanced Project Management

Organisational Readiness § § § § § The organisation places a high value on serving customers The commitment of senior managers is long-lasting Key staff departments are positive about the prospect of change The organisation has the human resources needed The organisation had the financial resources needed The organisation as a whole recognises the need for fundamental change The organisation has none of the complacency and arrogance that often follows a sustained period of success The organisation is free of the scepticism, mistrust and ambivalence that often follows a period of change The organisation’s experience with TQM has created an environment that is receptive to change Hammer & Stanton Advanced Project Management

Project Management Maturity Matrix World-class Wannabes Improvers Flat-liners Little or no progress in project performance Mistakes repeated; performance stays flat Improvers Some improvement Performance improves slightly over time Wannabes Follow every initiative going in order to catch the leaders World-class performers Set ever-increasing standards of performance Advanced Project Management

Project Excellence § Project excellence comprises cross-functional processes, project decision making, and team organisation that enable firms to bring highquality products to market rapidly. Project excellence builds on functional excellence (that is, when a function has the necessary resources, along with standards, procedures, and tools, to be effective and efficient). Four major elements are required to deliver projects effectively. These elements include the people and processes involved in development: project governance, a defined development process, project core teams, and the project decision process are the four elements. Advanced Project Management

Advanced Project Management

Project Excellence Model® Organisational areas Results areas Policy & strategy Appreciation Client Appreciation Project team Environment Leadership and teams Project management Means Appreciation Ind. parties Appreciation Contractors Contracting Feedback Advanced Project Management Appreciation Users Project results Source: Westerveld

EFQM Business Excellence Model Enablers Results People Management ( 9% ) Leadership (10%) Policy & Strategy ( 8% ) Resources ( 9% ) Advanced Project Management People Satisfaction ( 9% ) Processes (14%) Customer Satisfaction ( 20% ) Impact on Society ( 6% ) Business Results (15%)

Explicit knowledge Tacit knowledge Knowledge Creation and Management Externalisation Socialisation Articulating tacit knowledge explicitly Sharing experiences Combination Internalisation Building a ‘knowledge system’ Learning by doing Tacit knowledge Explicit knowledge To Advanced Project Management

A Learning Organisation is … “… Capable of benefiting from the variety of knowledge, experience and skills of individuals through a culture which encourages mutual questioning and challenge around a shared purpose or vision. ” Johnson & Scholes Advanced Project Management

Characteristics of a Learning Organisation § Existence of conflicting ideas and views § Tolerance of failure § Acceptance of ambiguity and uncertainty with their attendant risks § Surfacing of assumptions and explicit debate widely within the organisation § Tolerance of a diversity of views § Tolerance of ‘organisational slack’ Advanced Project Management

Using Learning and Discovery § Start with a ‘loose’ project approach built on many assumptions which are known § Accept the risks associated with the uncertainties § Track and review assumptions on a regular basis § Modify the assumptions and activities in the light of experience § Gradually learn what works and what doesn’t Advanced Project Management