PROJECT MANAGEMENT HAMO, Ma. Rebecca C.

A Project is a temporary endeavor undertaken to create a unique product, service,

or result. Each project attempts to achieve specific business objectives and is subject to
certain constraints, such as total cost and completion date. Organizations must always
make clear connections among business objectives, goals, and projects; also, projects
must be consistent with business strategies.

Projects are different from operational activities, which are repetitive activities
performed over and over again. Projects are not repetitive; they come to a definite end
once the project objectives are met or the project is cancelled. Projects come in all sizes
and levels of complexity.

Researchers Hamel and Prahalad defined the term core competency to mean
something that a firm can do well and that provides customer benefits, is hard for
competitors to imitate, and can be leveraged widely to many products and markets.
Today, many organizations recognize project management as one of their core
competencies and see their ability to manage projects better as a way to achieve an
edge over competitors and deliver greater value to shareholders and customers.

PROJECT VARIABLES

Five highly interrelated parameters define a project—scope, cost, time, quality, and
user expectations. If any one of these parameters changes for a project, there must be a
corresponding change in one or more of the other parameters.

(1) Scope
Project scope is a definition of which tasks are included and which tasks
are not included in a project. Project scope is a key determinant of the other
project factors and must carefully be defined to ensure that a project meets its
essential objectives. In general, the larger the scope of the project, the more
difficult it is to meet cost, schedule, quality, and stakeholder expectations.

(2) Cost
The cost of a project includes all the capital, expenses, and internal
crosscharges associated with the project’s buildings, operation, maintenance,
and support.

Capital is money spent to purchase assets that appear on the

organization’s balance sheet and are depreciated over the life of the asset.
Capital items typically have a useful life of at least several years. A building,
office equipment, computer hardware, and network equipment are examples of
capital assets.
 Expense items are nondepreciable items that are consumed shortly after
they are purchased.

Many organizations use a system of internal cross-charges to account for

the cost of employees assigned to a project.

EXAMPLE: the fully loaded cost (salary, benefits, and overhead) of a manager might be set at $120,000
per year. The sponsoring organization’s budget is cross-charged this amount for each manager who
works full time on the project. (The sponsoring business unit is the business unit most affected by the
project and the one whose budget will cover the project costs.) So, if a manager works at a 75 percent
level of effort on a project for five months, the cross-charge is $120,000 x 0.75 x 5/12 ¼ $37,500.

The rationale behind cross-charging is to enable sound economic

decisions about whether employees should be assigned to project work or to
operational activities. If employees are assigned to a project, cross-charging
helps organizations determine which project makes the most economic sense.
Money from the budget for one type of cost cannot be used to pay for
an item associated with another type of cost. Thus, a project with a large amount
of capital remaining in its budget cannot use the available dollars to pay for an
expense item even if the expense budget is overspent.

(3) Time
The timing of a project is frequently a critical constraint. Often, projects must
be completed by a certain date to meet an important business goal or a
government mandate.

(4) Quality
The quality of a project can be defined as the degree to which the project
meets the needs of its users. The quality of a project that delivers an ISrelated
system may be defined in terms of the system’s functionality, features, system
outputs, performance, reliability, and maintainability.

(5) User Expectation

 As a project begins, stakeholders will form expectations—or will already
have expectations—about how the project will be conducted and how it will
affect them.

There may be huge differences in expectations that can exist between

stakeholders and project members. It is critical to a project’s success to
identify expectations of key stakeholders and team members; any differences
must be resolved to avoid future problems and misunderstandings.

WHAT IS A PROJECT MANAGEMENT?

Project management is the application of knowledge, skills, and techniques to

project activities to meet project requirements. Project managers must deliver a solution
that meets specific scope, cost, time, and quality goals while managing the expectations
of the project stakeholders—the people involved in the project or those affected by its
outcome.

The essence of artistic activity is that it involves high levels of creativity and freedom
to do whatever the artist feels. Scientific activity, on the other hand, involves following
defined routines and exacting adherence to laws. Under these definitions, part of project
management can be considered an art, because project managers must apply intuitive
skills that vary from project to project and even from team member to team member. The
“art” of project management also involves salesmanship and psychology in convincing
others of the need to change and that this project is right to do. Project management is
also part science because it uses time-proven, repeatable processes and techniques to
achieve project goals.
Thus, one challenge to successful project management is recognizing when
to act as an artist and rely on one’s own instinct and when to act as a scientist and
apply fundamental project management principles and practices.