Accounting 09 - Project Management Reviewer
complete a fixed life project
Chapter 1 - Modern Project Management
What is a PROJECT? - A project is a temporary endeavor
undertaken to create a unique product, service, or result. It
should have a lifespan and a timeline.
Major Characteristics of a Project are:
➢ Established objective
➢ Defined lifespan with a beginning and an end - it
has a defined end-point
➢ Involvement of several departments and
professionals
➢ Doing something that has never been done before
- they are unique in most cases.
➢ Specific time, cost, and performance requirements
Difference of a repetitive work and a project
Repetitive Work Project
- Taking class notes - Writing a term paper
- Daily entering sales receipts - Setting up a sales kiosk for
into the acctg ledger a professional accounting
- Responding to a supply- meeting
chain request - developing a supply-chain
- Practicing scales on the info system
piano - writing a new piano piece
- Routine manufacture of an - Wire-tag projects for GE
Apple iPod and Wal-Mart
A project is not a routine, repetitive work. It is done only
once; a new product or service exists once a project is
completed.
A program is a group of related projects designed to
accomplish a common goal over an extended period of
time.
Program Management is the process of managing a
group of ongoing, interdependent, related projects in a
coordinated way to achieve strategic objectives.
Project Management Life Cycle - the cornerstone for
managing a project.
➔ Defining - setting of goals, specification, tasks,
teams are formed, major responsibilities are
assigned and adjustments follow.
➔ Planning - The level of effort increases.
Schedules, budgets, resources, risks, staffing.
➔ Executing (pinakamahaba and extensive ang level
of effort) - The physical product is produced (a
bridge, a report, a software program)
➔ Closing (three activities - delivering the project
product to the customer; redeploying project
resources; and post-project review) - Train
customers, transfer documents, release resources,
evaluation, lessons learned.
The Project Manager
❖ Manages temporary, nonrepetitive activities, to
❖ Must work with a diverse troupe of characters
(customers, managers, vendors, suppliers,
subcontractors) to complete projects
❖ Good decision maker
❖ Are not for the timid, working on projects can be
an extremely rewarding experience
Importance of a Project Management
● Compression of the Product Life Cycle - most
significant driving forces behind the demand for
project management is the shortening of the
product life cycle. Managers manage the
schedules.
● Knowledge Explosion - Product complexity has
increased the need to integrate divergent
technologies. Project management has emerged as
an important discipline for achieving this task.
● Triple Bottom Line (planet, people, profit) -
Efforts to reduce carbon imprint and utilize
renewable resources are realized through effective
project management. The impact of this
movement towards sustainability can be seen in
changes in the objectives and techniques used to
complete projects. (SUSTAINABILITY)
● Corporate Downsizing - limiting employees in
order to be efficient and cost cutting. Other people
from other countries are crowdsourced with lower
rates.
● Increased Customer Focus - Increased
competition has placed a premium on customer
satisfaction. Customers no longer simply settle for
generic products and services. They want
customized products and services that cater to
their specific needs.
● Small Projects represent Big Problems - (Naipon
ang backlogs, na-accumulate and hindi na
matatapos) hundreds of projects are implemented
concurrently. This climate has created a multi-
project environment and a plethora of new
problems.
The Technical and Sociocultural Dimension of the Project
Management Process
Sociocultural Technical
- Leadership - Scope
- Problem Solving - WBS
- Teamwork - Schedules
- Negotiation - Resource Allocation
- Politics - Baseline Budgets
- Customer Expectations - Status Reports
Effective project management begins with selecting and
prioritizing projects that support the firm’s mission and
strategy. Successful implementation requires both
technical and social skills. Project managers have to plan
and budget projects as well as orchestrate the
contributions of others.
Chapter 2 - Organization Strategy and Project
Selection
Strategy and Culture defined:
● Strategy are your mechanisms to achieve your
certain result or this is your goal that you want to
achieve that is why you are using your strategies.
Strategies are affected by your culture and your
organizational culture.
★ Strategy → goals, objectives, and activities
★ Culture → embedded here are your values,
practices, and behaviors
Reasons:
➢ To make appropriate decisions and adjustments
➢ To understand their organization’s strategy so
they can be effective project advocates
Strategic Management:
➢ is the process of assessing “what we are” and
deciding and implementing “what we intend to
be and how we are going to get there” through
your objectives
➢ Critical Dimensions include:
● Responding to changes in the external
environment
● Allocating scarce resources
Four Activities of the Strategic Management Process
1. Review and define the organizational mission - it
answers the question “what we want to become?”
2. Set long-range goals and objectives - it should be
SMART (Specific, Measurable, Attainable,
Realistic and Time-Bound) Objectives answer in
detail where a firm is headed and when it is going
to get there.
3. Analyze and formulate strategies to reach
objectives - Answers the question of “what needs
to be done to reach objectives.” Strategy
formulation includes determining and evaluating
alternatives that support the organization’s
objectives and selecting the best alternative.
4. Implement strategies through projects - answers
the question of “how strategies will be realized,
given available resources.”
Scenario Planning (aka Environmental Scanning, Needs
Assessment → is a structured process of thinking about a
possible future environment that would have potential
high impact to disrupt the way you do business, and
developing potential strategies to compete in these altered
environment. It is risk contingency planning, without
really moving organizational resources
1. Assessing the core business and industry -
clarification and agreement on the core business
of your organization and the environment in
which it exists.
2. Potential scenarios and impact - brainstorming
potential global forces that could have a
substantial impact and alter the way your
organization does business. Typical global forces
influencing scenarios are social, technological,
environmental, economic, political (STEEP)
3. Potential strategies - what strategy(s) would you
use to move the organization to respond to the
change? Learnings from the past or mga historical
records. Some strategies are not applicable.
4. Examples - (e.g. previous forecasts that can be
adopted as a potential strategy)
5. Triggers - tell you the event is quickly
approaching and detailed strategic planning is
needed. (e.g. redflags - alarming na haha!)
6. Summary - it could be examples
The Need for an Effective Project Portfolio Management
System - collection of best practices from previous
batches
1. The Implementation Gap - occurs when a project
manager is replaced with a new one and she does
not know what to do with the current project she
has on her plate. It refers to the lack of
understanding and consensus of organization
strategy among top and middle-level managers.
2. Organizational Politics - power grabbing happens
when a manager tries to grab the power from the
power holder. The term “sacred crow'' is often
used to denote a project that a powerful, high-
ranking official is advocating.
3. Resource Conflicts and Multitasking - happens
when there are very limited resources in an
organization.
Benefits of a Project Portfolio Management
● Builds discipline into project selection process
● Links project selection to strategic metrics
● Prioritizes project proposals across a common set
of criteria, rather than on politics or emotion
● Allocates resources to projects that align with
strategic direction
● Balances risk across all projects
● Justifies killing projects that do not support
organization strategy
● Improves communication and supports agreement
on project goals.
Portfolio Management System - aims to ensure that
projects are aligned with strategic goals and prioritized
appropriately.
Inclusions:
● Classification of a project
➢ Compliance (must do)
➢ Emergency (must do)
➢ Operational - supporting projects
➢ Strategic - support org in the long run
● Selection criteria
 ➢ Financial criteria - preferred method to 1. Simple 1. Expensive
evaluate project 2. Fast 2. Internal Strife (Projectitis-
➢ Nonfinancial criteria - project must be 3. Cohesive over-invested)
assessed whether or not aligned with the 4. Cross-Functional 3. Limited Technological
Integration Expertise
goals and objectives of the business 4. Difficult Post-Project
➢ Checklist model Transition
➢ Multi-weighted Scoring Model
● Sources and solicitation of proposals - search for
sponsors and bidders Matrix Arrangement
● Evaluating proposals - ranking; and
responsibility of priorities ● Hybrid organizational form in which a horizontal
● Managing the portfolio of projects - balancing project management structure is overlaid on the
the risks and types of projects normal functional hierarchy.
● Two chains of command: Functional and Project
Chapter 3 - Organization: Structure and Culture Managers
● Project team members report simultaneously on
Three Project Management Structures
both the functional and project managers
1. Functional Organization ● Matrix structure optimizes the allocation of
2. Dedicated Project Teams (Projectized Teams) resources
3. Matrix Structure ● Allows for participation of multiple projects while
❖ Weak performing normal functional duties
❖ Balanced ● Achieves greater integration of expertise and
❖ Strong project management

** Organizational Culture Weak Matrix Arrangement - FUNCTIONAL Mngr.

Project Management Structure - a project management ● Similar to a functional approach with the
system provides a framework for launching and exception that there is a formally designated
implementing project activities within a parent project manager responsible for coordinating
organization. project activities.
● The project manager has indirect authority to
Functional Organization expedite and monitor the project. Functional
manager calls most of the shots and decides who
● The authority is on the functional manager does what and when the work is completed.
● Coordination is maintained once the projects are
delegated to the respective functional units with Balanced Matrix Arrangement - Shared
each unit responsible for completing its segment
of the project ● The power is shared between functional and
● It is suitable for organizations that has ongoing project manager
operations such as manufacturing and production ● The project manager is responsible for defining
“what” needs to be accomplished while the
Advantages Disadvantages functional manager are concerned with “how” it
will be accomplished
1. No change 1. Lack of Focus ● The merger of “what and how” requires both
2. Flexibility 2. Poor integration parties to work closely together and jointly
3. In-depth expertise 3. Slow
4. Easy Post-Project 4. Lack of Ownership approve technical and operational decisions.
Transition
Strong Matrix Arrangement - PROJECT Mngr.

● Most authority and power lies with the project

Dedicated Teams manager
● The authority is on the project manager ● The project manager has broader control and
● Teams operate as a separate units under leadership functional departments act as subcontractors of
of a full-time project manager the project
● In a projectized organization where projects are
dominant form of business, functional Advantages Disadvantages
departments are responsible for providing support 1. Efficient 1. Dysfunctional conflict
for its teams 2. Strong Project Focus 2. Infighting
● The primary motivation of the team is to 3. Easier Post-Project 3. Stressful
Transition 4. Slow
accomplish the work of the project
4. Flexible

Advantages Disadvantages
Project Considerations Deliverables - expected measurable outputs that you need
to deliver to your client
1. Size of the project
2. Strategic performance Milestones - significant events in your project and kailan
3. Novelty and need for innovation siya matatapos
4. Need for integration
5. Environmental complexity Technical Requirements - in order for the business to be
6. Budget and time constraints operational
7. Stability of resource requirements Limits and Exclusions - define the limits and scope of
Organizational Culture - refers to a system of shared your project
norms, beliefs, values, and assumptions which binds Customer review - has the customers’ name and signature
people together, thereby creating shared meanings. and comments, feedback and recommendations
★ Provides a sense of identity to its members Stopped @ 13:39 GOODNIGHT AND GOOD LUCK
★ Helps legitimize the management system of an FOR TOMORROW
org
★ Clarifies and reinforces standards of behavior
★ Helps create social order

Key Dimensions of Organizational Culture

Chapter 5 - Estimating Project Times and Cost
1. Member identity
2. Team emphasis Estimating - it is the process of forecasting or
3. People focus approximating the time and cost of completing project
4. Unit integration deliverables. Estimating processes are frequently
5. Control classified as top-down and bottom-up.
6. Risk tolerance
Top-down (macro) estimates - are usually done by senior
7. Reward criteria
management. Management will often derive estimates
8. Conflict tolerance
from analogy, group consensus, or mathematical
9. Means versus end orientation
relationships.
10. Open-systems focus
● Used for high level decisions
Identifying Cultural Characteristics
● Used when there is little specific project
➔ Study the physical characteristics of an org information
➔ Read about the organization ● Disadvantage include inaccuracy of estimates
➔ Observe how people interact within the org
Bottom-up (micro) estimates - are typically performed
➔ Interpret stories and folklore surrounding the org
by the people who are doing the work. Their estimates are
Chapter 4 - Defining the Project based on estimates of elements found in the work
breakdown structure.
Five Steps in Defining the Project
● Yields a detailed estimate
1. Defining the Project Scope ● May lack coordination between activities
2. Establishing Project Priorities ● Accuracy is high but can be expensive to prepare
3. Creating the Work Breakdown Structure
4. Integrating the WBS with the Organization Why Estimating Time and Cost are Important?
5. Coding the WBS for the Information System
● Support good decisions
● Schedule work
● Determine how long the project should take and
its cost
● Determine whether the project is worth doing
Project Scope: ● Develop cash flows
❖ Describes what you expect to deliver ● Determine how well the project is progressing
(deliverables) to your end users ● Develop time-phased budgets and establish the
(customers/clients) when the project is complete project baseline
❖ Specific, tangible, measurable terms Cost, time, and budget estimates - are the lifeline for
❖ aka Statement of Work (Scope Statement) → control: they serve as the standard for comparison of
Project Charter actual and plan throughout the life of the project.
❖ Scope Creep → the tendency for the project to
expand over time)
Past experiences are a good starting point for developing
time and cost estimates.
Factors Influencing the Quality of Estimates
● Planning horizon
● Project duration
● People - can introduce error in estimating
transactions
● Project structure and Organization
● Padding estimates
● Organization culture
● Other factors
Estimating Guidelines for Times, Costs, and Resources
● Responsibility
● Use several people to estimate
● Normal conditions
● Time units
● Independence
● Contingencies
● Adding risk assessment to the estimate helps to
avoid surprises to stakeholders.
Methods for Estimating Project Times and Costs
** Top-down approaches for Estimating Project Times
and Costs
❖ Consensus Method - This method simply uses the
pooled experience of senior and/or middle
managers to estimate the total project duration and
cost.
❖ Ratio Methods - Top-down methods (sometimes
called parametric) usually use ratios, or
surrogates, to estimate project times and costs.
Top-down approaches are often used in the
concept or “need” phase of a project to get an
initial duration and cost estimate for the project.
❖ Apportion Methods - This method is an extension
to the ratio method. Apportionment is used when
projects closely follow past projects in features
and costs. Given good historical data, estimates
can be made quickly with little effort and
reasonable accuracy.
❖ Function Point Methods for Software and
System Projects - In the software industry,
software development projects are frequently
estimated using weighted macro variables called
“function points” or major parameters such as
number of inputs, number of outputs, number of
inquiries, number of data files, and number of
interfaces.
❖ Learning Curves - Some projects require that the
same tasks, group of tasks, or product be repeated
several times. Managers know intuitively that the
time to perform a task improves with repetition.
The pattern of this improvement has been
quantified in the learning curve (also known as
improvement curve, experience curve, and
industrial progress curve)
** Bottom-up approaches for Estimating Project Times
and Costs
❖ Template Methods - If the project is similar to
past projects, the costs from past projects can be
used as a starting point for the new project.
Differences in the new project can be noted and
past times and costs adjusted to reflect these
differences
❖ Parametric Procedures Applied to Specific Tasks
- Just as parametric techniques such as cost per
square foot can be the source of top-down
estimates, the same technique can be applied to
specific tasks.
❖ Range Estimating - works best when work
packages have significant uncertainty associated
with the time or cost to complete. If the work
package is routine and carries little uncertainty,
using a person most familiar with the work
package is usually the best approach.
Phase Estimating - this approach begins with a top-down
estimate for the project and then refines estimates for
phases of the project as it is implemented; however some
cannot be rigorously defined because of the uncertainty of
design or the final product. In these projects, phase life-
cycle estimating is frequently used. (e.g. aerospace
projects, IT projects and others).
Phase estimating is used when an unusual amount of
uncertainty surrounds a project and it is impractical to
estimate times and costs for the entire project.
Types of Costs
● Direct Cost (e.g. labor, materials, equipment,
others) - These costs are clearly chargeable to a
specific work package
● Direct Project Overhead Costs - Direct project
overhead costs can be tied to project deliverables
or work packages. (e.g. include the salary of the
project manager and temporary rental space for
the project team.)
● General and Administrative (G&A) Overhead
Costs - These represent organization costs that
are not directly linked to a specific project. These
costs are carried for the duration of the project.
(e.g. organization costs across all products and
projects such as advertising, accounting, and
senior management above the project level)
Refining Estimates
★ Interaction costs are hidden in estimates
★ Normal conditions are not applied
★ Things go wrong on projects
★ Changes in project scope and plans
Chapter 6 - Developing a Project Plan
The Project Network - a flow of chart that graphically
depicts the sequence, the inter-dependencies, and start and
finish times of the project job plan of activities that is the
critical path through the network.

 Provides the basis for scheduling labor and

equipment
 Enhances communication among project participants
 Provides an estimate of the project’s duration