Project Management Context Part 3 Dr aatay NDEER

Project Management Context (Part 3) Dr. Çağatay ÜNDEĞER Instructor Bilkent University, Computer Engineering Middle East Technical University, Game Technologies & General Manager Sim. BT Inc. e-mail : cagatay@undeger. com CS-413 Bilgisayar Mühendisliği Bölümü – Bilkent Üniversitesi – Fall 2009 1

Project Management Context • • CS-413 Project Stakeholders – Introduction – Who are stakeholders? Organizational Structures – Introduction – Functional Organization Structure – Projectized Organization Structure – Matrix Organization Structure – Project Management Office (PMO) Standards and Regulations – What is a standard? – What is a regulation? Life Cycle of a Tender – Introduction – From the view point of Employer & Tenderer – Summary 2

Project Stakeholders • A project is started because of having someone interested in – Outcome of a project, • Which is required to satisfy their organizational needs. • Stakeholders are; – Individuals who cause a project be initiated – Those who are most directly affected by the project’s completion. CS-413 3

Project Stakeholders • Actively involved in the project; • Have influence over project and its results. CS-413 4

Possible Stakeholders • Customers, – Who require outcome of project, • Sponsors, – Who support project financially, • Project manager, • Project team members, • Project management office, • Other influencers, – Who has influence on project due to their organizational position and power. CS-413 5

Project Management Context • • CS-413 Project Stakeholders – Introduction – Who are stakeholders? Organizational Structures – Introduction – Functional Organization Structure – Projectized Organization Structure – Matrix Organization Structure – Project Management Office (PMO) Standards and Regulations – What is a standard? – What is a regulation? Life Cycle of a Tender – Introduction – From the view point of Employer & Tenderer – Summary 6

Organizational Structures • Organizational structures can differ dramatically from one company to another. • Organizations may or may not be project based. • Those that are not project based; – Usually lack management systems necessary for efficient and effective project management. CS-413 7

Common Organizational Structures • Functional Organization Stucture • Projectized Organization Stucture • Matrix Organization Stucture CS-413 8

Functional Organization Stucture • A traditional hierarchical organization (like a pyramid) with; – Top management at the peak, – Direct workers at the bottom, – And middle managers in between. Project coordination Functional Manager CS-413 Chief Executive Functional Manager Staff Staff 9

Functional Organization Stucture • Each employee has; – One clearly designated supervisor. • Employees are grouped by their specialization such as; – Accounting, marketing, information systems, and manufacturing. CS-413 10

Functional Organization Stucture • People within different functional areas work separately on different parts of the project. • One group takes their part of the project, – Edits it, and • Throws it to the next group. • In IT projects, because of weak coordination between departments, • This structure causes more work for everybody, • Results with a product less than what it could be. CS-413 11

Projectized Organization Stucture • At the other extreme. • A structure where people from different functional backgrounds work together through life time of a project. Project coordination Project Manager CS-413 Chief Executive Project Manager Staff Staff 12

Projectized Organization Stucture • Designed specifically to provide necessary resources for the project work. • In IT projects, – Because of weak coordination in project groups, • Experienced personnel, possibly required for multiple projects, are not effectively used among projects. CS-413 13

Matrix Organization Stucture • In the middle spectrum. • A structure that typically crosses; – Functional design on one axis and – Some other design characteristic (e. g. project managers) on the other axis. Chief Executive Functional Manager Staff CS-413 Staff Manager of Project Managers Functional Manager Staff % Project coordination Project Manager Staff % Project Manager 14

Matrix Organization Stucture • Project staffs are designated to more than one supervisor; – Report to both; • Project managers and • Head of their functional areas. CS-413 15

Types of Matrix Stuctures • Weak matrix structures • Strong matrix structures CS-413 16

Weak matrix structures • More near to functional organizations. • Project managers; – Have less authority on projects, – Act like as coordinators than as independent managers. CS-413 17

Strong matrix structures • More near to Projectized organizations. • Project managers are dedicated to projects with full authority. CS-413 18

Strong matrix structures • More difficult to manage a matrix organization. CS-413 19

Project Management Office (PMO) • An organizational unit created; – To centralize and coordinate the projects within an organization. • Matrix structures often have a PMO. • Projectized structures almost always have a PMO. CS-413 20

Project Management Context • • CS-413 Project Stakeholders – Introduction – Who are stakeholders? Organizational Structures – Introduction – Functional Organization Structure – Projectized Organization Structure – Matrix Organization Structure – Project Management Office (PMO) Standards and Regulations – What is a standard? – What is a regulation? Life Cycle of a Tender – Introduction – From the view point of Employer & Tenderer – Summary 21

Standard • A document approved by a recognized body; – Provides, for common and repeated use, rules, guidelines, or characteristics • For products, processes or services, • With which compliance is not mandatory. • e. g. some software development standards such as; – IEEE Software development stds. – High Level Architecture (HLA) M&S std. CS-413 22

Regulation • A document that; – Specifies product, process or service characteristics, including applicable administrative provisions, – With which compliance is mandatory. • e. g. some safety regulations for production of public goods. CS-413 23

Project Management Context • • CS-413 Project Stakeholders – Introduction – Who are stakeholders? Organizational Structures – Introduction – Functional Organization Structure – Projectized Organization Structure – Matrix Organization Structure – Project Management Office (PMO) Standards and Regulations – What is a standard? – What is a regulation? Life Cycle of a Tender – Introduction – From the view point of Employer & Tenderer – Summary 24

Life Cycle of A Tender (Definitions) • Tender/Awarding : – A process for purchasing a service or material • Employer/Administration/Client : – Organization or person that requests to purcase a service or material • Tender Document : – A set of documents prepared and issued by the Employer for Tender purpose. CS-413 25

Life Cycle of A Tender (Definitions) • Tenderer : – Company submitting a proposal to the Tender • Tender Proposal : – The proposal of the Tenderer to meet the required service or material of the Employer CS-413 26

Life Cycle of A Tender (Definitions) • Tender Board/Commitee : – A group of people authorized by Employer • To select the best tender proposal among the submitting ones – According to Employer policies. • Contractor : – Company elected for providing the service and materials specified in the Tender document. CS-413 27

Life Cycle of A Tender (Definitions) • Contract : – Written agreement between Employer and Contractor • Setting forth the obligations of the parties thereunder, – Including, but not limited to; » The performance of the work, » The furnishing of labor & materials and the basis of payment. CS-413 28

Employer (Stage 1) • The Employer determines his needs. • Prepares a written document for his needs – (Project Definition Document). • Prepares a document for tendering process, – Including conditions and formalities of purchasing – (Conditions of Contract, and Accompanying Documents). • Determines tender closing date. • Prepares a guideline for the Tenderers – (Instructions to Tenderers). • Issues the Tender. CS-413 29

Employer (Stage 2) • Employer issues the tender by – Publishing it in the official gazette, and/or – Sending invitation letters: • To eligible companies or • If it is a confidential project, – To eligible companies having some; » Quality Levels (e. g. ISO, CMMI) » Security certificates (e. g. National, NATO). CS-413 30

Employer (Stage 3) • Until the tender closing date, the Employer : – May revise tender documents, – May postpone tender closing date, – May answers questions of Tenderers. • Collects proposals until tender closing date and – Pricing envelopes are only opened after this date. • Examines proposals for procedural convenience, and – May request Tenderer for correction of inconvenience. • Tenderers whose proposals do not satisfy procedural requirements are eliminated from the tender. CS-413 31

Employer (Stage 4) • Employer starts evaluating valid proposals and assigning points to them: – Technical Evaluation, – Company Qualification, – Administrative Evaluation, – Price Evaluation. • Employer orders companies with respect to their points. • Employer selects: – Either a winner company or – A few winner companies (short list) CS-413 32

Employer (Stage 5) CASE 1 : A Winner Company • In Case of a single winner company: – Winner company is announced – Employer; • May bargain price, • May request Best and Final Offer (BAFO), and • Discuss administrative and technical conditions and specifications with the winner. – An agreement is made. – A contract is signed by both parties. – Project is initiated. • In case of disagreement, – Employer may call second eligible company for contracting. CS-413 33

Employer (Stage 5) CASE 2 : A Short List • In Case of multiple winner companies: – Employer; • May bargain prices, • May request BAFO, and • Discuss administrative and technical conditions and specifications with each winner – (This could be done in a meeting open to all winners or in seperate meetings with individual winners). – Employer aim at obtaining best with lowest price. – Employer selects the most beneficial winner. – An agreement is made. – A contract is signed by both parties. – Project is initiated. CS-413 34

Tenderer (Stage 1) • Obtains Tender documents; – If Emloyer requests a price for applying, pays it. • Starts preparing a proposal: – Examines project requirements and risks; – Prapares a coarse project management plan; • Decides on the architecture (or alternatives); • Builds a work breakdown structure; • Estimates resources (e. g. time, cost) required; • Prepares a schedule if not given by the employer • Prepares a price breakdown structure; • Answers technical matters; • Answers administrative matters; – Prepares; • Official letters, Tender forms, Guatantee letters. CS-413 35

Tenderer (Stage 2) • Asks Employer for clarifications of unclear issues. • Revises his proposal. • Attaches; – Hardware and software specification documents, – Company qualification documents: • References, • Certifications (e. g. ISO, CMMI), • Any other related document. • Finalize Tender proposal. CS-413 36

Tenderer (Stage 3) • Submits Tender proposal, – Before Tender Closing Date; – Tries to submit it as late as possible; – Gets a verification document from Employer for his submission. • Waits for requests and decisions of Employer. • In case called by Employer, – Holds several meetings for agreement, – May reduce the price, or – Increase/decsrease specifications. – Upon agreement, • Signs a contract with the Employer, and • Project is initiated. CS-413 37

Summary EMPLOYER prepares tender documents EMPLOYER gets support of a consultant TENDERER gets tender documents EMPLOYER publishes tender documents Project is initiated EMPLOYER & TENDERER signs the contract CS-413 Tender closing date EMPLOYER (deadline for collects and answers questions proposals) evaluates proposals TENDERER prepares tender proposal EMPLOYER & TENDERER prepare contract EMPLOYER gets support of a consultant TENDERER submits tender proposal EMPLOYER may call the second winner EMPLOYER may request correction of inconveniences from TENDERERS EMPLOYER calls a winner EMPLOYER for bargain orders the proposals EMPLOYER annonces winner EMPLOYER selects the most benefical proposal EMPLOYER calls elected winners for bargain EMPLOYER makes a decision (continue or cancel) 38