PR04801 STUDY NOTES & 2016 TO 2017 EXAM SOLUTIONS

TOPIC 1: (PART 1) PHILOSOPHY AND CONCEPTS

1.1 What is a project?

A project is a temporary endeavour undertaken to create a unique product service or result. The
temporary nature of projects Indicates that a project has a definite beginning and end.

Every project creates a unique product, service or result. The outcome of the project may be
tangible or intangible.

A project can involve a single individual or multiple individuals, single organisational unit or
multiple organisational units from multiple organisations.

1.2 What is project management?

Project management is the application of knowledge, skills, tools and techniques to project
activities to meet the project requirements.

Project management can also be defined as a systems approach to management. It is made up

of a collection of interrelated components or elements which are combined to do something.

A project is also perceived as a system because it is a collection of elements which include:

 Work tasks managers with considerable authority and full- time project administration
 Resources
 Stakeholders (individuals, teams, organisations)
These elements are aimed at achieving some goal.

Project management is accomplished through the appropriate application and integration of 47

logically grouped project management process. These processes are categorised into five
process groups. These five process groups are:
 Initiating
 Planning
 Executing
 Monitoring and Controlling
 Closing

Managing a project typically includes, but is not limited:

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  Identifying requirements
 Addressing the various needs concerns and expectations of the stakeholders in
planning and executing the project
 Setting up, monitoring and carrying out communications among stakeholders that are
active, effective, and collaborative in nature.
 Managing stakeholders to word meeting project requirements and creating project
deliverables.
 Balancing the competing project constrains, which include, but are not limited to:
o Scope
o Quality
o Schedule
o Budget
o Resources
o Risks

1.3 Characteristics of projects and project management

 A single person (the project manager) heads the project organisation and works
independently of the normal chain of command.
 Project work require a unique variety of skills and resources. Therefore, the work might
be performed by people from different functional areas or outside contractors.
 Projects are temporary in nature and have a definite beginning and ending date.
 Projects are completed when the project goals are achieved.
 A successful project is one that meets or exceeds the expectations of the stakeholders.
PROJECT OPERATIONS

 Intermittent operations
 Continuous (repetitive) operations.
1.4 The need for project management

Project management is very necessary for a number of reasons:

 Pressure for greater productivity

 Changes in the global economy
 A need to adapt
 Project management can be applied everywhere

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  Project management can be applied to any ad hoc undertaking. The more unfamiliar or
unique the undertaking the greater the need for project management.
 The more numerous, interdisciplinary and interdependent the activities, in the
undertaking, the greater the need for project management to ensure everything is
coordinated, integrated and completed and nothing is overlooked.

1.5 The approach to project management

Project management has three dimensional goals – time, cost and performance (TCP).
Time: is the scheduled period over which the work is to be done.
Cost: is the specified or budgeted cost for the project.
Performance is what the project end-item, deliverables or final result must do. It includes what
the project customer, end-user and other stakeholders consider important.
The purpose of project management is to hit the target, i.e. to achieve the goal of the project.
The target represents a goal to deliver certain something to somebody by a certain date and for
a certain cost.
Project management constraints: Technological complexity, changing markets and an
uncontrollable environment make it difficult to achieve the objectives.
Time, cost and technical performance are interrelated. Project management offers a way to
maintain focus on all the three dimensions and to control the trade-offs among them.
Management by project (MBP) - An undertaking or a set of activities is planned and managed
as if it were a project.
 MBP implies that the project will have well – defined objectives and scope,
organisational requirements for the end results, a plan of work, a completion date, and
a budget for the required resources.
 A team is formed for the purpose of performing the work and a project manager or team
leader is assigned to guide and coordinate the work.

1.6 Features which distinguish project management from traditional forms of

management
The person, the team and the methodology are the features which distinguish project
management from traditional forms of management.
 The person is the project manager. He has the overall responsibility to plan, direct, and
integrate the efforts of everyone involved in the project to achieve the project goal. The
project manager is accountable for the project and is totally dedicated to achieving its

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 goals. He is the coordinator of every functional area, oversees the planning, control of
costs, schedules and work tasks.
 The team: Project management means bringing individuals and groups together to form
the team and directing them towards a common goal.
 Project management methodology: The methodology provides for integrative planning
and control of projects. It refers to pulling together of all important elements of
information related to the products or results of the project, time, cost in funds,
manpower or other key resources. The project manager relies on the methodology to
identify project tasks, identify the required resources and costs, establish priorities, plan
and update schedules, monitor and control end-item quality and performance and
measure project performance.
 A project management methodology is a framework or procedure specifying who
should do what at each stage of the project life cycle. Standards such as the PMBOK
Guide provide processes and tools that often are incorporated into the methodology.
 Aims of project methodology:
o It helps assure that all projects are conducted and managed in a similar manner
o To ensure that recognised good and best practices are applied across all projects
o To provide a common way to do things and a common terminology. This
enhances communication and learning about those ways.
 What the methodology mandate:
o It specifies the stages of the life cycle for projects in an organisation
o It specifies the roles and management tasks of project managers and
stakeholders at each stage. It specifies who is responsible for initiating,
proposing, reviewing and selecting projects and roles and responsibilities.
o It specifies the individuals who must review the project at gates and sign off on
budgets.
 Phases and gates
o The project management methodology defines the steps/phases/stages into
which projects are divided, e.g. initiation, feasibility, definition, development
and launch – and what should happen at each stage.
o At the beginning of each phase/stage there is a gate. At that point the current
status of the project and plans for the remainder of the project are assessed and
a decision is made whether to continue, hold or cancel the project. The gates

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 represent approval of project initiation, system requirements, system validation
and system launch.
o The gating process is one way of pulling weaker, less promising projects so that
scarce resources are devoted to stronger, more promising projects.
o It also reduces risk in large, stand-alone projects.
 Elements of project methodology: Methodology defines phases or stages of the project
life cycle and for each phase the task and deliverables, stakeholders and their
responsibilities. Methodology specify
o Detailed tasks and methods for analysis
o Definition
o Planning
o Monitoring
o Control
o Closeout
1.7 Types or forms of project management
Different forms of project management are: systems management, task force management,
team management, ad hoc management, matrix management and program management.
Two common features of all project management forms are:
 They have a project team or project organisation created uniquely for the purpose of
achieving a specific goal
 A single person – project manager – assigned responsibility for seeing that the goal is
achieved
Basic project management

 It is implemented in two forms: pure project and matrix forms

 In pure project management a complete self-contained organisation is created; the
required resources belong to the project and do not have to be borrowed
 In matrix management, the project organisation is created from resources borrowed
from the functional units. The project must share its resources with other projects
and with the functional areas from which they are borrowed.
 The project manager and functional managers are on the same organisational level
 Both report to the same senior level persons
 The project manager has formal authority to plan, direct, organise and control the
project from the start to finish

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  Project manager reports to the general manager or owner and keeps him appraised
of project status
 Project manager sometimes has authority to hire personnel and procure facilities or
has to negotiate with functional managers to borrow them
Pure project organisations

 Projects that involve much complexity, major resource commitments and high stakes
require a pure project or projectised form of organisation.
 A pure project is a separate organisation created specifically to achievement of a project
goal.
 The organisation is made up of liaisons, task forces and teams
 It is headed by a pure project manager. Unlike a coordinator or expeditor, the pure
project manager has formal authority over all people and physical resources assigned
to the project – has maximum control
 The project manager can bring resources from internal functional areas as well as
contract out with external subcontractors and suppliers.
 The project manager is involved in the project from start to finish. During proposal
he/she requests and reconcile plans from functional areas and prepares preliminary
budget and schedule estimates. After acceptance he/she hires personnel. During project
execution he/she allocates resources and approves changes to requirements and the
project plan. Heads selection of and negotiations with subcontractors. He/she oversees
and coordinates their work with other areas of the project.
Program management

 A program extends over a longer horizon than a project

 It consists of several parallel or sequential work efforts or projects working to meet a
program goal
 Projects are oriented to delivering or producing a product or service. After that the
project organisation is dissolved and responsibility is handed over to someone else for
operating the end-item. In a program the program management ensure that the end-item
is not only delivered but is integrated with other systems and operational for as long as
needed.
Matrix organisations

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  Suitable for organisations which are involved in many projects at a time. These
organisations continually operate on a project basis, e.g. architecture and construction
industries, IT.
 The organisations need capability to create large project groups quickly without the
personnel and cost disadvantages associated with pure project organisations.
 Functional part provides the pool of technical expertise and physical resources needed
by projects
 Each project manager creates a project team by negotiating with functional managers
to borrow the expertise and physical resources needed for his/her project
 Workers associate with colleagues in their fields of specialisation. This keeps them
current in their profession and make them more assignable to new projects.
 This type of organisation eliminates anxiety and reduces fluctuations in workforce
levels and worker morale since workers will return to their functional homes when their
assignments are fulfilled.
 The project manager oversees the resources and unifies and integrates functional areas
to achieve goals.
These types include:

 Systems management
 Task force management
 Team management
 Ad hoc management
 Matrix management
 Program management
NOTE: All types of project management have two basic characteristics:

 They have a project team or project organisation created uniquely for the purpose of
achieving a specific goal.
 A single person (a project manager) who is assigned responsibility for seeing that the
goal is accomplished.
AD HOC MANAGEMENT
Ad hoc is an adjective used to describe things that are created on the spot, usually for a single
use.
Ad hoc projects are usually developed when an unprecedented challenge or problem arises that
cannot be solved using standard or predetermined business procedure.

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By definition of ad hoc, these tasks are not planned ahead of time. They arise from new
circumstances.
THE PROJECT MANAGER’S ROLE

The project manager is responsible for applying the correct tools and techniques to ensure the
success of the project.
Effective project management requires that the project manager possess the following
characteristics:
 Knowledge of project management
 Performance: what the project manager is able to accomplish while applying project
management knowledge.
 Personality: The personal effectiveness of the project manager consists of personality
characteristics, leadership ability, problem solving skills attitude and the ability to guide
the project team while achieving project objectives and balancing project constrains.
The project manager has formed authority to plan, direct, organise and control the project from
start to finish.

The project manager at times has authority to hire personnel and procure facilities.

TWO FORMS OF PROPJECT MANAGEMENT

 Pure project
 Matrix

In pure project management:

 Self- contained organisation is created
 The needed resources belonging to the project and do not have to be borrowed.
In matrix management

 The project organisation is created from resources borrowed from the functional units
 The project must share its resources with other projects and with functional areas
from which they are borrowed

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PROJECT ORGANISATION STRUCTURE AND INTEGRATION

There are three fundamental organisational structures that you need to know for the exam.

 Functional
 Matrix (weak , Balanced , strong)
 Projectised
Organisational structure is an enterprise environmental factor, which can affect the availability
of resources and influence how projects are conducted.

The classical functional organisation

It is a hierarchy where each employee has one clear superior. Staff members are grouped by
speciality such as production, marketing, engineering and accounting at the top level.
Specialities may be further subdivided into focused functional units, such as mechanical and
electrical engineering. Each department in a functional organisation will do its project work
independently of other departments.

FUNCTIONAL ORGANISATION

In this organisation type, the project manager has little to no authority on the project. Usually
the project manager is part time and is often referred as a project expeditor or project
coordinator. The functional hierarchy is that all the team resources report to a functional or
line manager. The project manager has little or no input into performance reviews of the
project team and frequently must approach functional managers hat in hand to make the best
case they can for project resources.

FUNCTIONAL ORGANISATION MODEL

ADVANTAGES OF FUNCTIONAL ORGANISATIONS

 Clearly defined career paths

 Familiar structure
 Direct supervisor reporting structure
 Employees are experts
 Easier budgeting and control one possible
 Better technical control is possible
 Specialists can be grouped to share knowledge and responsibility

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  Personnel can be used on many different projects
 Flexibility in the use of manpower
 A broad manpower base to work with
 Good control over personnel , since each employee has one and only one person to
report to
 Communication channels are vertical and well established.
 Quick reaction capability exists, but may be dependent upon the priorities of the
functional managers.

DISADVANTAGES OF THE FUNCTIONAL ORGANISATION

 Employee’s job is difficult to change

 No one individual is directly responsible for the total project (ire no formal authority
, committee solutions )
 Does not provide the project – oriented emphasis necessary to accomplish the project
tasks.
 Coordination become complex and additional lead time is required for approval of
decisions.
 Decisions normally favour the strongest functional groups.
 No customer focal point.
 Response to customer needs is slow.
 Difficulty in pin pointing responsibility , this is the result of little or no direct project
reporting , very little project oriented planning and no project authority.
 Motivation and innovation are decreased.
 Ideas tends to be functionally oriented with little regard for ongoing projects.
NOTE: In functional organisations

 The functional managers maintain absolute control over the budget. They establish their
own budgets on approval from above and specify requirements for additional personnel.
Because the functional manager has man power flexibility and a broad base from which
to work most projects are normally completed within costs.
 The disadvantages clearly outnumber the advantages.

THE MATRIXED ORGANISATION

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The organisation attempt to combine the advantages of both the functional and the projectised
organisation while minimising the disadvantages. Matrix organisations reflect a blend of
functional and projectised characteristics. Matrix organisations can be classified as weak ,
balanced or strong depending on the relative level of power and influence between
functional and project managers.

Weak matrix organisations maintain many of the characteristics of a functional organisation

and the role of the project manager is more of a coordinator. The expeditor cannot personally
make or enforce decisions. Project coordinators have power to make some decisions, have
some authority and report to higher level manager.

WEAK MATRIX ORGANISATION MODEL

Strong matrix organisations have many of the characteristics of the projectised organisation
and have full time project managers with considerable authority and full time project
administrative staff. Project managers has almost complete control of project resources, budget,
and timeline, quality and customer satisfaction.

STRONG MATRIX MODEL

The balanced matrix organisation recognise the need for a project manager, it does not
provide the project manager with the full authority over the project and project funding.

BALANCED MATRIX ORGANISATION MODEL

ADVANTAGE OF MATRIXED ORGANISATION

 Objective remain visible

 Increased support from functional managers
 Increased control by project manager
 Increased control by project manager
 Improved flexibility
 Job remain after project is complete
 Multiple inputs on team members performances
DISADVANTAGES OF MATRIXED ORGANSATION

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  Multiple bosses
 Adds complexity
 Additional policies and procedures are necessary
 Different priorities or objectives may exist
NB. In a matrix environment, the advantage outnumber the disadvantages

THE PROJECTISED ORGANISATION OR PURE PRODUCT ORGANISATION

 In a projectised organisation team members are often collocated. Most of the

organisation resources are involved in project work, and project managers have a great
deal of independence and authority. Virtual collaboration techniques are often used to
accomplish the benefits of collocated teams. Projectised organisation often have
organisations often have organisational units called departments but they can either
report directly to the project manager or provide support services to the various projects
 The projectised organisation is one that derives its primary income from delivering
projects. In this organisation the project manager has ultimate authority over the
project , including the timeline , the budget , the resources , the scope , the quality and
ultimately , customers satisfaction.
 In this environment the project resources are dedicated 100% to working on projects
and focused on the project at hand. This approach is effective when the project is very
high priority and requires the dedicated focus of everyone on the team. Very large and
complex projects are executed in a projectised environment.
ADVANTAGES OF PROJECTISED ORGANISATION

 Dedicated project focus

 Project loyalty
 Efficient project organisation
 Efficient project communication
 Provide complete line authority over the project (i.e. strong control through a single
project authority )
 Participants work directly for the project manager. Unprofitable product lines are easily
identified and can be eliminated.
 Strong communication channel
 Staff can maintain expertise on a given project without sharing key personnel.
 Very rapid reaction time is provided

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  Personnel demonstrate loyalty to the project better morale with product identification
 Flexibility in determining time (schedule) cost and performance trade off.

DISADVANTAGES OF THE PROJECTISED ORGANISATION

 Cost of maintaining this form in a multi-product company would be prohibitive due

to duplication of effort , facilities and personnel ; inefficient usage.
 A tendency to retain personnel on a project long after they are needed. Upper level
management must balance workloads as projects start up and are phased out.
 Technology suffers because without strong functional groups , outlook of the future to
improve company’s capabilities for new programs would be hampered (i.e. no
perpetuation of technology)
 Control of functional (i.e. organisational) specialises requires top level coordination.
 Lack of opportunities for technical inter change between projects.
 Lack of career continuity and opportunities for project personnel.

PROJECTISED ORGANISATION MODEL

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SUMMARY OF THE FUCTIONAL MATRIX AND PROJECTISED
ORGANISATIONS

Project Functional Weak Balanced Strong Projectised

characteristics matrix matrix matrix
AND
Organisation
structure
Project Little or Limited Low to Moderate High to
manager’s none moderate to high almost total
authority
Resource Little or Limited Low to Moderate High to
availability none moderate to high almost total
Who controls Functional Functional Mixed Project Project
the project manger manager manager manager
budget
Project Part-time Part-time Full-time Full-time Full-time
manager’s
role
Project Part-time Part-time Part-time Full-time Full-time
management
administrative
staff

THREE DIMENSIONAL FEATURES OF PROJECT MANAGEMENT

 The person (project manager)

 The team
 The methodology (integrated planning and control)

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THREE DIMENSIONAL TARGETS OF PROJECTS (TCP)

 Time
 Cost
 Performance
PRINCE2 MODEL

Prince to abbreviation for projects in controlled environments. Controlled environments

include government departments. A Prince2 project by a finite and clearly defined life cycle,
namely:

 Measurable business products (defining activities to achieve these products)

 A defined amount of resources
 A defined organisational structure
 Emphasise the business case
 Emphasises the ground work that begins before the project does

ADVANTAGES OF USING PRINCE2 MODEL

 It is proactive , early warning and able to accommodate unexpected events

 The method is teachable and respectable
 Everyone know exactly what to expect how , where and when
 It uses a process based approach to project management
 It emphasis the business case through the project as the main control reference

PRINCE2 MODEL: MANAGEMENT PROCESS

 A pre-project process starting up a project

 The authorisation process (directing the project)
 Project initiation documents (the lesson learned log, quality log, etc.)
 The management of stage boundaries
 Control of each stage as a specific cycle process
 The management process of product delivery
 The execution of a controlled close out
 The repeatable process of planning (the process produces a product check list and a risk
log)

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FOUR TYPES PF PROJECT MANAGERS PRODUCED BY THE EVOLUTION OF
PROJECT MANAGEMENT

 Matrix manager
 Functional managers
 Projectised managers
 Composite managers
INSTANCES WHEN PROJECT MANAGEMENT IS APPROPRIATE

It is appropriate to use project management when:

 The project involves doing different things or doing the same things but differently
(unfamiliarity).
 When a job requires substantially more resources (people , capital , equipment, etc.)
than are normally employed by a department or organisation (Magnitude of effort )
Examples: merging two companies, developing a new product.

 When an organisation operates in an environment characterised by high innovation,

intense competition, shifting markets and consumer demands. Project management
provides the necessary flexibility to deal with emerging threats and opportunities in
such environments (Dynamic environment).
 When the effort requires that functional areas should work together. Functional areas
tend to be self- serving and work independently, however, project management is
necessary to build relationships between the areas, expediate work and reconcile
conflicts. The project manager coordinate the efforts of internal functional areas and
with outside sub-contractors and vendors (Interrelatedness).
 Reputation of the organisation: project management reduce the inherent risks in large,
complex undertakings. Therefore , if failure to satisfactorily complete a project would
result in financial ruin , loss of market share , damaged reputation , or loss of future
contracts , the case for using projects management is strong.
INSTANCES WHEN PROJECT MANAGEMENT IS NOT APPROPRIATE

Project management is not appropriate when:

 The undertaking is more familiar and routine

 The environment is more stable
 The environment is less unique and more standardised

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  Much standardised, repetitive operations have certainty and do not require project
management initiatives.
DIFFERENT FORMS OF PROJECT MANAGEMENT IN COMMERCIAL
ENVIROMMENT

 Pure project management

 Matrix management
 Program management
 New venture management
 Product management
 Project portfolio management

PROGRAM MANAGEMENT

A program is a group of related projects, sub programs and program activities, managed in a
coordinated way to obtain benefits not available from managing them individually.

Programs management is the application of knowledge skills, tools, and techniques to a

program in order to meet the program requirements and to obtain benefits and control not
available by managing projects individually.

Program management focuses on the project interdependences and helps to determine the
optimal approach for managing them. Actions related to these interdependences may include:

 Resolving resource constrains and / or conflicts that affect multiple projects within the
program.
 Aligning organisational / strategic direction that affects projects and program goals and
objectives.
 Resolving issues and change management within a shared governance structure.
An example of a program is a new communication satellite system with projects for design of
the satellite and the ground stations, the construction of each, the integration of the system and
the launch of the satellite.

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PROJECT PORTFOLIO MANAGEMENT

A portfolio refers to projects, programs, subportfolios and operations managed as a group to

achieve strategic objectives. Organisations select and group projects and programs into
portfolios. The purpose of portfolio management is to make sure that the right projects and
programs are selected. This will help to make sure that projects and programs align with
organisation’s strategic and financial goals and fit within the available limited resources.

Portfolio management is about selecting and retaining the right projects. In a nutshell, portfolio
management refers to centralised management of one or more portfolios to achieve strategic
objectives. It focuses on financial and analytical skills needed to select and group projects and
programs based on their contribution to strategic and financial goals. Above all , it ensures
that project and programs are reviewed to prioritise resource allocation and that the
management of the portfolio is consistent with and aligned to organisational strategies.

NEW VENTURE MANAGEMENT

This is a type of management used in consumer-oriented firms for generating new products
or markets. In this form of project management a team is created to find new products or
markets that fit an organisation’s specialised skills, capabilities and resources. After defining
the product, the team will design and develop it. Thereafter, it will determine the means to
produce, market and distribute it.

PROJECT ENVIRONMENTS

Project management is different in different project environments. Daniel Roman classifies

these environments as:

 Commercial / For-profit project management

 Governance and Non-profit project management
 Military project management
COMMERCIAL | FOR PROFIT PROJECT MANAGEMENT

 These end-item is a clearly defined product or service produced specifically to satisfy

a customer and is motivated by profit criteria.

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  The project manager guides the project start to finish , coordinate efforts of the project
team with functional areas , sub-contractors and vendors , keep the customer and top
management informed of progress toward project and profit objective.
GOVERNMENT AND NON PROFIT PROJECT MANAGEMENT

 There is no profit incentive in government and non-profit work.

 Project continuance often depends on political considerations and funding
 Most of these projects focus on evaluation or testing of products or services produced
from commercial contractors or vendors.
 Project manager’s role is mainly administrative.
MILITARY PROJECT MANAGEMENT

Projects involve testing and evaluating hardware developed by contractors. The major criteria
for evaluating projects are technical and political.

SECTORS OF PROJECT MANAGEMENT

 New product and systems development projects.

The development of every new product and system is a project, e.g. projects for developing
products and system for defence.

 Construction projects
 Service – sector projects: Project management is employed in a broad range of services
such as banking, insurance, accounting etc.
 Public – sector and government projects and programs
 Maintenance work
 Events
PROJECT MANAGEMENT DYNAMICS

Dynamic refer to change, energy, new happenings, challenge, conflict and results.

 Project management has several transformation (input – output) value – adding

processes
 Each phase of the project life cycle has certain process groups and these process groups
overlap.
This is part of project integration which indicates certain dynamics.

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  Project management can be viewed us dynamic due to its unique philosophy and form
of management.
 It is usually challenging, uncertain and complex.
 Project management dynamics are also seen in interpersonal and stakeholder relations,
conflict management, time management, leadership, learning curves, change agents and
so forth.

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STUDY UNIT 2: SYSTEMS APPROACH AND SYSTEMS ENGINEERING

SYSTEM – an organised or complex whole

It also refers to an assemblage of things or parts interacting in a coordinated way.

FEATURERS OF A SYSTEM

Parts of a systems affect the system and are affected by it.

 The assemblage of parts serves a purpose or goal.

 The assemblage is of particular interest.
System thinkers see the bigger picture and focus on whole organisms. In addition, system
thinkers look the parts and try to understand the relationships among them. Project managers
need to integrate a chaotic situation to some degree of order. They need system thinking
because it is a useful way of dealing with complex phenomena.

2.3 SYSTEMS CONCEPTS AND PRINCIPLES

1 Goals and objectives

Human made systems have goals and objectives. A goal is a broad, all-encompassing statement
of the purpose of a system. On the other hand, an objective is more detailed, quantifiable
statement of purpose.

2 Elements and subsystems

The smallest part of a system is called an element. A subsystem is a system that functions as a
component of a larger system. In a project, an element could be a unit of work, a person or
group doing the work or a component of the end item being produced by the project.

3 Attributes
These are distinguishing characteristics of systems, subsystems and elements. Time and cost
are the most common attributes used to assess the project’s performance.

4 Environment and boundary

Environment refers to anything outside the system which influence the behaviour or outcome
of the system. Managers have no control of the environment. Environment include, the
community, air etc. A system is separated from its environment by a boundary. Irrelevant
environment includes all things that do not influence the system and that do not matter.

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Relevant environment include factors that matter to and affect the system in some way, but
have to be lined with.

5 System structure
System structure is the shape or taken by the relationship between elements and sub systems.
The appropriateness of the structure determines the function and effectiveness of a system.

Types of system structures

 Hierarchical structure
 Work breakdown structure
Hierarchical structures consists of organised levels of sub- elements within elements, elements
within sub systems and so on. According to the hierarchy of tasks and responsibilities.

CONCEPTUALISING PROJECT STRUCTURE

DRAW A FIGURE

 Element X represent the entire project

 Element A , D and C are areas of work or management decisions in the project
 Element a through g are specific work tasks.
 This structure is also called a work breakdown structure (WBS)
6 Inputs , Process , Outputs , Interfaces
 Inputs: Raw materials, resources or steps necessary for the system to produce outputs.
Inputs include controllable factors such as : Labour ,Materials, Information, Capital,
Energy, Facilities
 Outputs are the end result of a system. They are the purpose for which the system
exists. Systems have multiple outputs these include desirable ones that contribute to
system objective, Neutral ones, and Undesirable or wasteful ones that deviate from
system objectives. The undesirable outputs can negatively impact the environment.
 They also include uncontrollable factors such as Weather and natural phenomena (i.e.
the environment)
 Inputs originating from the system itself are called feedback.
 All systems produce information. Usage of that information. Usage of that for guiding
system behaviour is called feedback input.

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  Process – is also known as function. It is the method or means by which the system
physically converts or transform inputs to outputs.
 Interfaces - it is condition produced when two elements which were the output of one
becomes the inputs of the other.
7 Constraints and conflicts
Constrains or limitations are elements which inhibit the ability of systems to reach goals and
objectives. These constrains can be imposed by environment, time and money.

8 Integration
The objectives of the subsystems are sometimes in conflict in a human made system. Conflict
reduces the chances that the goal of the overall system will be realised. Integration is the
process of removing conflict from objectives to enable meeting the goal of overall system.

System integration is designing, implementing and operating a system that achieves its
objectives and requirements through the coordinated functioning of its elements and
subsystems. The goal of project management is to integrate tasks and resources to achieve
project goals.

9 Open systems of closed systems

 A closed systems is self- contained
 Closed systems thinking means to focus on the internal operation, structure and
process of a system without considering environment.
 Open systems interact with the environment. The system is adaptive to the environment.
10 Organisation and Environment
 Organisation as open systems interact with stakeholders in the environment
 These stakeholders include customers, suppliers, unions, stakeholders, governments
etc.
 Organisations rely upon the environment for inputs of energy people information and
material.
 At the end of the production process organisations export to the environment outputs
of goods services, waste and information.
The environmental problem: Organisation must choose goals and conduct its operations so as
to respect opportunities presented and limitations imposed by the environment.

A project manager must:

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  Appreciate the need to access forces in the environment
 Understand the forces that significantly affect the organisation
 Integrate these forces into the organisation’s goals , objectives and operations
Every project is influenced by outside forces. The project manager must try to understand these
forces so as to be able to guide the project to its goal.

11 Natural systems and human made systems.

 Natural systems originated by natural processes (e.g. organisms and planetary
systems)
 Human made systems are designed and operated by people communication systems
and human organisations)
 Projects are human made systems created for the purpose of creating other human –
made system.
 Natural systems can be altered by or become intertwined with human made systems
 Human made systems are embedded in and utilise inputs from natural systems.
SYSTEMS APPROACH FRAMEWORK

 Systems approach is a framework for abstracting problems, solving problems and

making decisions.
 The approach acknowledge that the behaviour of any one element may affect other
elements.
 No single element can perform effectively without help from the others
 System approach recognises interfaces, interdependency and cause – effect among
elements.
 Systems approach is also regarded as a methodology for solving problems and
managing systems.
 It is holistic
 It avoids tackling problems narrowly or head on.

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APPLICATION OF THE SYSTEMS APPROACH IN PROJECT MANAGEMENT

 Project management begins with the mission or objectives of the systems and then
organises and directs all subsequent work to achieve these objectives.
 The environment of the system must be identified.
 The resources to be used to accomplish system goals must also be identified.
 In a project there are actually two systems - the one being produced by the project
(the project itself)
 The system approach pays attention to the management of the system.
It pays attention to its planning and control, its objectives, environment and constraints,
resources and many others.

SYSTEM MODELS

System thinkers use models to help understand systems and assess alternative plans and
solutions. A model is a simplified representation of a system. It abstracts the essential features
of the system under study. It may be physical model, mathematical formulation, computer
simulation or simple checklist. Models are used assess various alternatives and their
consequences before community to a decision.

SYSTEM LIFE CYCLES

Most project follow a cycle called the project life cycle. A life cycle is the basic pattern of
change that occurs throughout the life of a system. The system approach recognises the natural
process that occurs in all dynamic systems – that of birth, growth, maturity and death. The
natural process is incorporated into the planning and management of systems.

The process of developing, implementing and operating any human- made system follows a
logical sequence of phases called the systems development cycle. Projects also follow a
sequence of phases from beginning to end called the project life cycle.

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PROJECT LIFE CYCLE

Human made products and systems have similar life cycle to that of organisms – birth, growth,
maturity, senescence and death. Project life cycle implies that each project has a starting point
and progresses toward a predetermined conclusion.

Basically there are three types of project life cycles

 Predictive
 Iterative
 Adaptive
PREDICTIVE

A predictive lifecycle is also known as a plan driven or waterfall approach to delivering the
scope of the project. In this approach the scope, time and cost required to deliver that scope are
determined as early in the project life cycles as possible. The project can proceed to a series of
sequential or overlapping phases with each phase focusing on delivering a subset of the
project’s deliverable. The work in each phase is different in preceding or subsequent phases,
therefore, the skills sets required of the project team may vary from phase to phase.

ITERATIVE

With an iterative or incremental life cycle, project phases are intentionally repeated as the
team’s understanding of the product increases. The product is developed through a series of
repeated cycles while the product incrementally grows at the completion of each iteration. Each
iteration incrementally builds on the deliverables from the previous iterations until the exit
criteria for the project are met.

ADAPTIVE/CHANGE DRIVEN/AGILE

The adaptive lifecycle, also known as change driven or agile is designed to address high levels
of change, risk and | or uncertainty in a project. Agile projects are also incremental and iterative
but with the singular difference that the iterations are generally very short time, usually to 4
week. Once a project iteration length is selected for a project iteration length is selected for a
project it remains consistent throughout the project. The overall scope of the work is
decomposed into an element called a product backlog. The product owner , or business
representative , collaborates with the performing organisation to prioritise the product
backlog and is ultimately responsible for deciding what gets developed and in what sequence.

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SYSTEMS DEVELOPED LIFE CYCLE

Project life cycle is part of a larger life cycle called the systems development cycle (SDC). All
human made systems follow the four phases of this cycle.

1. Conception phase (phase A)

2. Definition phase (phase B)
3. Execution phase (phase C)
4. Operation phase (phase D)
PHASE A: CONCEPTION

This is the conception phase, which is made up of the initiation stage, feasibility stage and
proposal preparation. The contractor examines the customer’s problem, objectives and
requirements. Determination of the technical and economic feasibility of undertaking the
project will be done at this stage. The contract will provide a proposed solution to the customer.

PHASE B: DEFINITION

It includes:

 A detailed analysis of the system concept

 It defines requirements the system must fulfil to meet the customer’s needs.
 Defines the functions and elements the system must possess to meet system
requirements
 Preliminary design for the system takes place.
 The major subsystems, components and support systems of the proposed system are
determined.
 Resources, costs and schedules necessary to build the system are determined.
 Project management assembles a comprehensive project plan that defines the activities,
schedule, budgets and resources to design, build and implement the system.
 Contractor top management and customer review the plan for acceptability.
NOTE: Phases A and B are referred to as front-end planning – this refers to everything that
happens in the project before the work execution in phases.

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PHASES C: EXECUTION

At this stage the work specified in the project plan is put action. Sometimes referred to as the
acquisition phase because the user acquires the system at the end of the phase and most system
resources are acquired at this phase. The phase include design, production and implementation
stages.

 The system moved from being an idea to a finished, physical end item.
 During the execution phase the system is implemented, installed and becomes a part
of the user’s environment.
PHASE D: OPERATION

 The system is developed / delivered / handed over.

 The customer takes over to operate the system and maintain it.
 Phases include operation and maintenance of the system as well as improvement and
enhancement to keep the system viable and useful.
PROJECT MANAGEMENT METHODOLOGY

PHASED PROJECT PLANNING AND FAST TRACKING

 The phases and stages in a project life cycle are sometimes undertaken in a step wise
fashion. This method is called phased project planning or project grating.
 At the end of each phase the project objectives, costs and outcomes are evaluated and
a decision is made to continue, suspend or cancel the project.
 Resources are only committed after a management review.
Fastracking - This is a method which suggest that project phases are not always performed
in a chronological sequence but they can be overlapped . In this case before phase B is
completed elements of Phase C, are started, before Phase C, is completed, portions of phase D,
and are started.

 Fastracking reduces the time for systems development and implementation.

 On the contrary, Fastracking poses the risk of overlooking or misdefining tasks and
having to repeat or undo them.
Agile methodology: In this method some phases are repeated. The execution phases and the
definition phases are repeated in cycles. Each cycle intend to refine, enhance or build upon the
results of the previous cycle.

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  Agile Project Management (APM) methodology accommodate uncertainty in an
iterative, learn – as – you – go manner.
 In APM projects, the customer / develop does not know or is unclear about the desired
solution and cannot define the end – time requirements up front.
 The main aim of the definition phase in APM is to identify the customer’s wants and
needs and create a high level plan to address those needs.
 The high level plan specifies the anticipated number, length and objectives of the
iterations.
SYSTEM DEVELOPMENT CYCLE STAKEHOLDERS

 Stakeholders are actors and interested parties.

 The main stakeholder groups are :
o System customers (buyers, clients or owners). They include customer management,
users and operators.
o System contractors (the system development organisation CSDO), developer, promoter
or consultant. The system contractors include , contractor top management ( corporate
and functional managers) ; project management (project manager and staff) ; the doers
( professional , trade , assembly and other workers).

N.B Customers are the persons or groups for whom the project is being done. These people
will acquire and / or operate the system when it is completed.
 The customer (owner, buyer, and sponsor) pays for the system.
 The user use and operate it.
 The contractor or developer or consultant is the party that studies, designs, develops,
builds and installs the system.
 The life cycle involves other key such individuals, groups and organisations with vested
interests and / or influence on the conduct of the project.
N.B. anyone who is affected by the project, perceives he is affected by it or potentially can
alter its outcome is a stakeholders.

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DETAILED PRESENTATION OF PHASE A: CONCEPTION.

The conception phase compromises two stages.

 Project initiation: The stage establishes the need or problem which exists and have to
be investigated.
 Process begin when the customer or user perceives a need.
 The processes recognises a problem or opportunity and ways to deal with it.
 Project initiation requires providing that the need is significant and can be fulfilled at
practical cost.
INITIAL INVESTIGATION

The user undertakes a short internal investigation to clarify the problem and evaluate possible
solutions.

The investigation focuses on the elements of the problem, including:

 The environment
 The needs symptoms, problem definition and objectives.
 Preliminary solutions and estimated costs, benefits, strengths, and weaknesses of each.
 Affected individuals and organisations
 The results of the investigation determines whether to proceed or not with the idea.

 Project feasibility
o A detailed investigation of the need or problem.
o A formulation of possible alternative solutions and the selection of one.
o The phase ends with an agreement that a chosen contractor will provide a specified
solution to the customer.
o Feasibility assessment is the process of studying a need, a problem and solution in
sufficient detail to determine if an idea is economically viable and worth developing.
o A feasibility study is a more protracted, rigorous study that considers alternative
solutions (system concepts), benefits and costs of each.
o Technical feasibility - assess the risk that the technology might not work.
o Commercial feasibility – assess the risk that the product might fail in the market.
o Feasibility also addresses the question of how the project will be financed and its
expenses covered throughout the project life cycle.

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 o One of two things happen if the feasibility study indicates that the concept is viable.
THEME A: Internal – concept given to internal group for development and execution.

THEME B: External - The concept cannot be executed internally it is given to outside

contractors (SDOs). Some companies do feasibility studies for new products and then hand the
approved concepts to their own teams for the design, development and production of products.
On the other hand some companies after taking a decision, hire outside contractors to execute
the project. In this case, they solicit proposals and bids from multiple contractors with an RFP
document to select the best.

N.B Feasibility study is done so as to assess the merits of the project.

 Project feasibility is crucial and notes the different processes applicable.

 It can happen at multiple times and with many different parties in a project.
 The feasibility process checklist includes
a) The needs definition
b) User requirements
c) Alternative solutions
d) EIS - environmental impact statement.
 After the project feasibility, the project charter can be set up and to prepare the proposal
(a project itself) can be finalised.
THE FEATURES OF THE FEASIBILITY STUDY

 Feasibility can be performed at multiple times with different parties in a project.

 The customer also performs a study to determine if the project is worth supporting.
 If the project work is to be done externally, the contractor also performs one to
determine if the job is worth pursuing.
STEPS TO BE FOLLOWED WHEN DOING AN EXTERNAL FEASIBILITY STUDY

 The contractor respond to an RFP by developing a definition of the problem that is more
concise, accurate and complete than the one in the RFP.
 The contractor identifies who the user really is (the party that will operate, maintain or
be the main beneficiary of the system. If the customer is an organisation, the contractor
must determine the individuals whose needs are to be met.

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OBJECTIVES OF A FEASIBILITY STUDY

A feasibility study is conducted to obtain an over view of the problem and to roughly assess
whether feasible solutions exists prior to committing substantial resources to a project.

The primary objective of a feasibility study is to assess three types of feasibility:

1. Technical feasibility
The key question: Can a solution be supported with existing technology?
2. Economic feasibility
Key question: Is existing technology cost effective?
3. Operational feasibility
Key question: will the solution work in the organisation if implemented?

N.B By intent the feasibility study is a very rough analysis of the viability of a project.
The feasibility study answers a basic question: Is it realistic to address the problem or
opportunity under considerations?

REQUEST FOR PROPOSAL (RFP)

 It is also called request for bid request for quotation , invitation for bid (CIFB)
 It is a document the customer send to potential contractors explaining the customer’s
problems , objectives , requirements and desire to hire someone.
 It states what the customer wants to see in the proposal (proposal requirements) as well
as proposal evaluation criteria.
 The main purpose of the RFP is to outline the user’s needs, problems or idea.
 The other purpose is to solicit suggestions or proposals for solutions.
 The RFP is usually preceded by a Request for Qualifications or RFQ
RFQ request contractors to describe their qualifications. At the end the customer sends RFPs
to contractors which are seen as qualified for the work.

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CONTROL OF A REQUEST FOR PROPOSAL

1. STATEMENT OF WORK
 Describes the problem , need or general type of solutions to be investigated
 Scope of work to be performed by the contractor, work to be included or excluded,
work restrictions, criteria for acceptance for results or end- items.
 Requirements for the solutions, results or end – item. It also includes specialisations
and standards , description of how work will be measured ; expected relationship
between user and contractor expected completion date ; constrains of the work to be
performed.
2. PROPOSAL REQUIREMENTS
It includes:
 Conditions placed on the proposal such as proposal contents and format.
 Data requirements
 Sample forms to include
 Submission location and deadlines
3. CONTRACTUAL PROVISIONS
This section specifies
 Type of contract to be awarded
 Sample contract
 Nondisclosure provisions
4. TECHINICAL INFORMATION OR DATA
The section focuses on:
 Any additional data or name of a contact person for requesting additional
data necessary to develop a solution and prepare the proposal or price quote.

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 5. PROPOSAL EVALUATION CRITERIA
The section explains the criteria and procedures for assessing the proposal and selecting a
contractor.

N.B The RFP must be clear, concise and complete

THE BUSINESS CASE DOCUMENT

The feasibility study sometimes results in a document called a business case.

 The business case is a document which assesses the value and risks (feasibility)
of a project at an early stage. It attempts to convince the customer, sponsor to
authorities and undertake the project.
 It is sometimes used to obtain financing for the project from commercial
banks ( a bankable business case )
 Some companies uses the business case to compare the value of notes associated
with a project to those of other projects.
 The content of a business case is based on the findings of a feasibility study.
 If the feasibility study indicates the project is viable, then the business case is
written to justify the project.
CONTENTS OF A BUSINESS CASE
A business case typically includes:
 Cost-benefit analysis: estimated project costs compared to the benefits.
 Estimated project duration (when financial return depends on the time scale)
 Financial aspects such as funding approach.
 Risks issues and a preliminary
 Assumptions
NEEDS DEFINITION

 Problems originate from needs.

 A problem is an unsatisfied need
 All problems need solutions
 A solution is a way to satisfy a need
 The solution adopted for the project must address the right needs.
 Conducting a feasibility study and preparing a proposal should begin with defining user
needs.

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REQUIREMENTS FOR OBJECTIVES AND LIFE CYCLE

Every project and end-item system to which it is directed start with a statement of objectives
that elaborate on the needs and provide the basis for defining requirements.

1. OPERATION MODES
The project life cycle is made up of different ways and kinds of environments in which
the system will be used or operated. These different ways and kinds are called operation
modes.
2. CONSTRAINS AND INTERFACES
Every system faces limitations or constraints. These limitations are imposed by the
environment and other systems with which it interacts or interface with the limitations
include:
 Mandated policies , procedures and standards
 Limits on resources, time, funding, technology and knowledge.
 Environmental constraints including technological requirements, laws, social
and norms and customs.
THE CURRENT SYSTEM VIS-À-VIS FEASIBILITY STUDY

The purpose of the feasibility study is to understand and document the current system.

In order to understand the current system focus will be given on variables such as:

 Inputs
 Outputs
 Functions
 Flows
 Subsystems
 Components
 Relationship
 Attributes
 Resources
 Constraints

A need usually arises because of inadequacies of the current system. In actual fact they will be
a gap between the current system’s capability and a desired capability.

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ENVIRONMENT IMPACT

Project feasibility also determine the project’s or end-item systems impact on the natural
environment. The results of the Environment Impact Assessment (EIS) often affect the project
plan and the system’s design. The project managers and supporters should try to develop a
positive working relationship with the environment assessment team.

Contents of the EIS include:

 Management plans / a summary of proposal development.

 Alternative sites and technologies for the proposal project.
 A description of the project’s existing site and surrounding area.
 Potential project impacts on natural environment, water species, society, heritage
resources, historical resources, etc.
 Adverse impacts that cannot be avoided
 Long term impacts on resources
 Ways to prevent minimise or offset impacts, ways to monitor actual impacts.
SUSTAINABILITY VIS- A -VIS THE PROJECT LIFE CYCLE

In order to reduce negative or harmful effects to the environment and its habitat, projects must
be managed with an eye on sustainability.

Efforts must be made to incorporate environmental and social responsibility into the role of
project management. The construction industry in the UK has created guidelines for
designing and constructing buildings , known as , design for environment and green
construction.

Matters of sustainability arise throughout the project life cycle.

They arise in:

 Project initiation , feasibility and definition

 The RFP, proposal, contract, requirements and project plan.
 Risk analysis
 Project execution

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N.B The project plan should minimally ensure that the project and its outcomes comply with
local, state and federal environment laws.

The results of the feasibility study is:

 A statement of the problem

 A list of needs and user requirements
 A description of the current situation
 Preferred solution and reasons for its selection.

Project proposal is formed through a combination or integration of the feasibility study, project
plan, bid price and contractor qualifications.

THE PROJECT CHARTER

 It is proclamation that the management has approved a project.

 It is created after a feasibility study or acceptance of a proposal
 For internal projects the charter’s purpose is to announce and formally authorise the
start of the project.
 For external projects a charter is not required since its purpose is served by a contract.
 The charter describes the project to stakeholders in an organisation
 It establishes the project manager’s authority to organise and make use of resources
 It has to be signed by at least one executive manager
 It is brief and provides an overview of the execution plan
 In front-end loading (FEL) a charter is created for and used to authorise each phase
 The PRINCE2 methodology prescribes three charters: a mandate – which authorises
the first pre-project stage of the project; a brief – authorises the second, initiation stage
and a final set of documents (project initiation documentation) authorises subsequent
stages.
The charter include the following:

 Project vision, purpose, benefits, problems it will solve or opportunity it will exploit
 Project justification (business case and environmental impact analysis findings)
 Approach to be followed
 Main deliverables, criteria for acceptance, individuals responsible for acceptance
 Clients and key stakeholders

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  Identification of the project manager and his authority and responsibilities
 Identification of other decision makers, their authority, responsibilities and reporting
relationships
 Listing of resources, including project team staff, required training, subcontractors, etc,
 Project organisation and work breakdown structure
 Project budget summary and ash flow plan
 Master schedule, project phases, key milestones, planned due dates
 Perceived risks and issues
 Plans for procurement, safety, health, environmental protection, communication
 Control procedures
COMPARISON OF PROJECT CHARTER AND EXECUTION PLAN

These two documents differ in two ways despite their similarities

 The purpose of the charter is to describe, justify, and authorise the project
 The purpose of the execution plan is to is to give direction to stakeholders working in
the project
 The execution plan is substantially longer, more detailed and comprehensive than the
charter
THE PROJECT PROPOSAL

 The proposal is a document which tells the customer what a contractor intends to do.
 It is also the basis for selecting the project contractor
 The effort to prepare the proposal itself is a project on its own.
Proposal preparation

 It requires top management authorisation.

 When authorised management identifies a technically competent person to oversee the
preparation of the proposal.
 Project manager selects the proposal team to help prepare the proposal.
 Project manager reviews the requirements of the RFP and prepares a detailed summary
of the to- be-proposed project.
 Project team outlines the work to be done for the solution identified in the feasibility
study.

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  Project team prepares a statement of work or sow. The sow will include the system
and project objectives , technical solution , high level requirements and major areas of
required to deliver the solution.
 Project team prepare a rudimentary project plan that will address project time, cost and
performance issues. A work breakdown structure (WBS) will be used to determine
the tasks necessary to achieve the requirements and to prepare a schedule and cost
estimate N.B The proposal sometimes includes the WBS , schedule and a cost
breakdown showing how the project price was derived.
The proposal is a sales device, therefore, it must convince the customer that the contractor is
competent and capable of doing the work. More importantly, the proposal must conform to the
RFP specifications and satisfy the user’s requirements.

Contents of a proposal

The main ingredients of a typical proposal are:

Executive summary:

 Briefly state the qualifications, experience and interests of the contractor.

 Draw attention to the unique or outstanding features of the proposal, the price and
contractor’s ability to do the project.
 The contractors contact person is mentioned.
N.B The executive summary must convince the customer to read out of the whole proposal. It
should be more personal.

Technical Section (scope of work)

 Indicates the scope of the work the planned approach. Must be specific and demonstrate
appropriateness of the approach. Should discuss problems or limitations found in the
approach.
 Describe the benefits which will fulfil the needs of the users.
 Contains a schedule of when end – items will be delivered. Based on a work breakdown
structure it will include the major project phases and key tasks, milestones and reviews.

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Cost and payment section

Breaks down

 Projected hours for direct, indirect and special activities and associated labour charges,
materials expenses and price of project.
 Include preferred or required contractual arrangement and method of payment.
Legal section

 Contains anticipated, possible or likely problems.

 Provisions for contingencies e.g. Appropriate procedures for handling changes to the
scope of the project and for terminating the project.
Management / qualification section

 Describes the background of the contractor , related experience and achievements

 Financial responsibility
 Organisation of management, resumes of project manager and key project personnel.
THE PROCESS OF SELECTING THE WINNING PROPOSAL

 The customer evaluates and compares proposals

 The process of selecting a winning proposal includes reading an agreement with the
contractor and committing funds.
Criteria for selecting a project proposal.

 Project price
 Ability of contractor to satisfy needs (solution or technical approach)
 Return on investment
 Project plan and management
 Contractor qualifications and reputation
 Likelihood of success or failure (risks)
 Fit to contractor resources and technological capability

NOTE

 Each proposal should include a rudimentary project plan showing key activities, start
and end dates and deliverables for each.

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  Selecting the best proposal often begins with pre-screening the proposals and
rejecting the ones that that fail to meet certain cut – off requirements such as to high
price tag , too – low rate of return or insufficient experience of the contractor.
Project contracting

 Contracting is a common phenomenon in project management.

 All work is done in accordance with formal or in formal contracts.
 The prime contractor or SDO oversee the entire project. This contractor might contract
other parties such as subcontractors, consultants, material suppliers and contract labour
(union trade professionals ) to be responsible for portions of the project.
Contract administration (Aspect of Project Control)

 It is responsible for ensuring that all commitments by the contractor and the customer
specified in the contract are met.
 Procurement management , is an aspect of contract administration that deals
specifically with managing relations with suppliers and subcontractors who provide
contracted goods , work and services.
Contract administration includes:

 Authority work to begin

 Monitoring work with respect to budgets , schedules and technical performance
 Ensuring quality
 Controlling changes
 Sending and receiving payment for work completed

SUBCONTRACTING

This happens when a contractor hires someone to do the work on his / her behalf.

 Obligations in subcontracts exist solely between a contractor and subcontractor.

 Work that is contracted, subcontracted or procured from suppliers is referred to as
procured goods, work and services.
CONTRACT NEGOTIATION

This is the process of clarifying technical or other terms in the contract and reaching agreement
on time, schedule and performance obligations.

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Contractual agreements include:

 Fixed Price contract – The price paid by the customer for the project is fixed regardless
of the costs incurred by the contractor. The customer knows what the project will cost.
 Costs – Plus Contract: The price paid is based on the costs incurred in the project plus
the contractor’s fee. The contractor is assured that his costs will be covered.
 Incentive Contract: The amount paid depends on the contractor’s performance in
comparison to the target price, schedule or technical specification. The contractor either
receives a bonus of exceeding the target or must pay a penalty for not meeting it.
CONTRACT STATEMENT OF WORK AND WORK REQUISITIONS (CSOW)

 The CSOW defines the expected performance of the project interms of scope of work,
requirements, end results, schedules, and costs and so on.
 The CSOW specifies the conditions under which the deliverables or end results will be
accepted by the customer.
 Failure to clearly state these conditions can lead to later disputes and delays in
completing the project.
 Contracts with suppliers and subcontractors include CSOW, responsibilities and
liabilities.
 Contracts for procured items include specifications, quantities, delivery schedules,
costs, payment schedules and ways to handle changes or variations.
Work requisition or word order: This is a document which contains the SOW for each group
in a project. Its purpose is to describe to each party the work expected of it and to authorise the
work to begin.

WORK AUTHORISATION

 It is part of the project control process

 All project work is started only after formal authorisation and is stopped only upon
review and acceptance.
 The project manager is authorised to begin the project upon acceptance by the
customer , program manager and / or top management of the project plan . The project

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 manager then authorises the managers of sub projects to begin, who authorises
managers and supervisions of work packages at the next lower level.
NOTE: Signing of the project contract marks completion of phase A and authorisation to begin
the project and proceed to Phase B.

SUMMARY OF PHASE A: Project initiation, proposal preparation and project authorisation

process.

Step 1: User organisation (client / customer)

 Initial investigation
 Feasibility approval
 Send out RFF
Step 2: System development organisation (contractor / consultant)

 Top management: Approve proposal effort, select project management, authorise

proposal budget.
 Project management : select proposal team , prepare work breakdown (functional
requirements schedule )
 Functional management: prepare work, labour and material estimate.
 Project team : formulate final budget and proposal
 Top management: Review budget and proposal; decide to submit the budget or revise
work break down.
 User organisation : Review proposal , reject or negotiate or contract
 Top management : Authorise project
 Project management : Authorise work (requisition)
 Functional management : Begin work
NOTE: Phase A is the foundation part of the systems development cycle. It establishes the
needs objectives, requirements, constraints, agreements and patterns of communication upon
which the remaining phases on built. It is a crucial stage / phase where often the seeds of project
success or failure are planted.

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PROJECT DEFINITION AND SYSTEM DEFINITION

PHASE B: DEFINITION

The key variables in this phase are:

 Project definition
 System definition
 User and system requirements
 After the approval of the project in Phase A, Phase B focuses on definition, design,
productions and implementation of the solution.
 The solution is scrutinised. It is analysed and defined sufficiently so that designers
and builders will be able to produce a system that meets the customer ‘s needs.
 Definition implies thinking through what the customer want to happen and how the best
to make it happen in the future.
 Definition is that stage where ideas and plans are thoroughly finished out before final
commitments are made and work begins.
 The phase encompasses project definition and system definition.
PROJECT DEFINITION

 Aim at specifying what the project team must do in the project to produce the end- item.
 Addresses the question: what must the project do to deliver the system concept and
satisfy the user and system requirements?
 During project definition phase the process involves identifying the necessary work
tasks and resources creating schedules, budgets, cost control systems and the project
team its leaders, subcontractors and support staff.

Project definition involves the formation of a detailed Project Execution Plan. The execution
plan is directed to people who will be involved in implementing the project. The plan addresses
what they will need to know. The main parts of the project execution plan are:

 A scope statement or SOW

 Work breakdown structure and work packages or tasks
 Project organisation and responsibility assignments
 Assignments of key personnel to work packages

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  Project schedules showing events milestones , or points of critical action
 Budget and allocation to work packages
 Quality plan for monitoring and accepting project deliverables including testing plan.
 Risk plan and contingency or mitigation measures
 Procurement plan
 Work review plan
 Change control plan
 Implementation plan to guide conversion to, or adoption of deliverables.
 Health, Safety and environmental (HSE) policy / plan.
CONTRACT A PROPOSAL SUMMARY PLAN AND A PROJECT EXECUTION
PLAN

 Proposal summary plan is aimed at the customer

 Project execution plan is aimed at the project team.
 The proposal summary plan includes enough information about the project and the price
to enable the customer to make decision.
 The project execution plan lays out the specifies of the project that will serve as a road
map to guide the project team throughout the project execution.
CONTENTS OF EXECUTION PLANS

Scope, charter, or statements of work

 Includes brief description of the project objectives, overall requirements, constraints,

risks, problem areas and solutions.
 Master schedule showing major events and milestones.

Management and organisation section

 Project management and organisation: key personnel and authority relationships.

 Manpower: workforce requirements estimates: skills, expertise and strategies for
locating and recruiting qualified people.
 Training and development: Executive development and personnel training necessary to
support the project.

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Technical section (Major project activities, training and cost)

 High level user requirements and system requirements.

 Work breakdown structure: work packages and detailed description of each, including
resources, costs, schedules and risks.
 Responsibility assignments: List of key personnel and their responsibilities for work
packages and other areas of the project.
 Project schedules: Generalised project and task schedule showing major events,
milestones and points of critical action or decision.
 Budget: control accounts and sources of financial support. Budgets and timing of all
capital and developmental expenses for work packages and project.
 Quality plan: measures for monitoring quality and accepting results of individuals work
tasks components and end – item assemblies.
 Areas of uncertainty and risk plan: Risks strategies, contingency and mitigation plans
for areas posing great risk.
 Health , safety and environmental (HSE) plan : to address HSE and sustainability
matters affecting project workers , the community and society arising from the project
and its end – results.
 Communication plan : Expected meetings , reports , participants formats - formal
and informal .
 Human resource plan: Project organisation, roles, responsibilities, staffing and training.
 Work review plan: Procedures for periodic review of work, what is to be reviewed, by
whom, when and according to what standards?
 Testing plan: listing of items to be tested, test procedures, timing and persons
responsible.
 Change control plan: procedures to review and handling of requested changes or the
facts changes to any aspect of the project.
 Documentation policy / plan: List of documents to be produced, format, timing and
how they be organised and maintained.
 Procurement policy / plan: Policy, budget, schedule, plan and controls for all good work
and services to be procured externally.
 Implementation plan: Procedures to guide customer conversion to or adoption of
project deliverables.

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COMPARE AND CONTRAST PROJECT DEFINITION AND SYSTEM DEFINITION

 Project definition is related to what , who , where, when and how

 System definition aims at achieving a good understanding of what the end – item must
do to satisfy user requirements.
 Project definition aims at specifying what the project team must do in the project to
produce the end -item.
 System definition begins with defining user needs and requirements
 Project definition begins with the requirements in the project proposal.
 Project definition is initiated in Phase A.
SYSTEM DEFINITION

 The system is the end result or solution to a problem.

 Systems are defined from their requirements.
 Requirements are the starting point for all systems development projects.
 Requirements are also the foundation for project planning.
 Each requirement impacts end – item scope and complexity which in turn impact
project work effort , time , cost and risk.
SYSTEM REQUIREMENTS

 In phase B user requirements are translated into system requirements.

 System requirements are oriented towards the solution.
 They specify the contractor’s approach and objectives for satisfying the needs as spelled
out in the user requirements define the system or solution approach. These include the
principle functions , system architecture and resulting end- item (system , solution
or product)
 The system requirements also provide a common understanding among project team
members as to what must be done in the project.
 On the other hand , user requirements represent the user’s perspective
 System requirements derive from the contractor’s perspective. They state what the
system must do to satisfy the user requirements.
 System requirements specify what the project’s designer and builders must address in
designing and building the end – item.
Requirements analysis: It is about defining requirements sufficiently so that designers will
know what they are striving for.

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  Requirements analysis will lead to a comprehensive list of functional requirements.
FUNCTIONAL REQUIREMENTS

 They specify the functions that the new system must be able to perform to meet the user
requirements.
 The functional flow block diagram (FFBD) is the common tool for identifying the
functional requirements of a complex system.
 Targets or performance requirements: are associated with each functional requirement.
The project team refers to these performance requirements in the design or purchase of
components for the system.
Other requirements imposed on the overall system or subsystems and components are:

 Compatibility – ability of subsystems to be integrated into the whole system or

environment and to the objectives of the whole system.
 Commonality – Ability of a component to be used interchangeably with an existing but
different type of component.
 Cost effectiveness – Total costs of the system. It includes the cost of the design as well
as the cost of complementing and operating the design to achieve a given level of
benefit.
 Reliability: Ability of the system or component to function at a given level or for a
given period of time before failing.
 Maintainability: Ability of the system to be repaired within a certain period of time.
 Testability: Degree to which the system can be systematically tested and measured for
its performance capabilities.
 Availability: Degree to which the system can be expected to operate when it is needed.
 Usability: Amount of physical effort or strain, technical skill, training or ability required
for operating and maintaining the system.
 Robustness: Ability of a system to survive in a harsh environment.
 Expandability: Ability of the system to be easily expanded to include new functions or
be adopted to new conditions.
NOTE: The ten requirements listed above are also called non- functional requirements.

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PROPERTIES OF EACH REQUIREMENT

 Priority and margin are the properties of each requirement.

 Priority of the requirement is the relative importance of the requirement.
 The margin on a requirement is the amount by which the requirement is the amount
by which the requirement can vary. Tells the designers how far and by how much they
can exceed the specifications.
REQUIREMENTS BREAKDOWN STRUCTURE (RBS)

 RBS is a way of grouping requirements.

 RBS include every identified functional requirement.
 The purpose of RBS is to provide a common reference for everyone working on the
project.
 The RBS enables multiple system components to coordinate efforts and to avoid
omissions or duplication.
SYSTEM SPECIFICATIONS

 Are derived from system requirements

 They define the end – item and its subsystems, components and processes.
 System specification are the criteria that will guide actual project work.
 They are written by and for project subject matter specialists - system analysts,
programmes, engineers, product and process designers, consultants etc.
 They address all areas of the project - design, fabrication, installation, operation and
maintenance.
 They are set to meet customer baseline specifications

COMPONENT OF PHASE B: PROJECT KICKOFF

 Project kick off is the first formal meeting of the project team and key stakeholders.
 The purpose of the meeting is to announce that the project is about to start.
 The meeting also communicate what the project is about to develop common
expectations and generate enthusiasm and commitment to project goals and
deliverables.

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  Stakeholders who attend the meeting include : project manager (runs the meeting) ,
project team , managers team leads and project staff and supporters.
The meeting introduces the following:

- The project manager

- The project SOW
- Goals
- Deliverables
- The proposed plan – budget , schedule main work packages
- Constraints and risks
- The customer, key stakeholders and their needs and requirements.
- The project organisation and key team members
- Immediate next steps and who is to do what.
COMPONENT OF PHASE B: PROJECT NAME

- A project is often named for a place, person or the end – item creates.

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 TOPIC 3 (PART 3): SYSTEM AND PROCEDURES: PLANNING
STUDY 5: PLANNING FUNDAMENTALS

Project management can broadly divided into two parts:

1. The conception and definition phases : preparing a plan that specifies the project
requirements , work tasks , responsibilities , schedules and budgets .
2. The executor phase, executing the work in the plan and tracking progress versus
the plan.
PLANNING STEPS

Step 1: Define the project objectives, scope and system requirements. These specify the project
deliverables, end –items, and other results as well as the time cost and performance targets.

Step 2: Define the work activities, tasks or jobs to be done to achieve the objectives and
requirements. These activities include everything necessary to create and deliver the end – item
or deliverables including planning, control and administration activities.

Step 3: Specify the project organisation the individuals or departments, sub-contractors, and
managers that will perform and manage the work and specify their responsibilities.

Step 4: Create a schedule showing the timing of work activities deadlines and milestone dates.

Step 5: Create a budget and resource plan to find and the project.

Step 6 : Specify the method for tracking and controlling project work , which is necessary to
keep the project conforming to the schedule , budget and user and system requirements.

PROJECT SCOPE DEFINITION

 It describes how big the project is.

 Project objectives deliverables and major tasks of the project determine the overall size
of the project and the range or extent of work it encompasses (project scope).
 The process of setting the project scope is called scope definition.
 Determining the project scope happens during the project conception, when the project
is initiated; during the preparation of the RFP and the proposal and during the project
definition.
 User needs and requirements are compared to time, cost, resource and technology
constraints to determine what the project should and can encompass.

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NOTE: SCOPE DEFINITION FEATURES

 Project definition involves specifying the breadth of the project and the full span of its
outputs, end – results or deliverables.
 Inclusions are the end – items to be produced or delivered by the project.
 Exclusions are the items, conditions or results not to be included in the project.
 Distinguish between inclusions (contractor responsibilities) and exclusions (possible
customer responsibilities) prevents misunderstanding and false expectations.
 Scope definition focuses primarily on determining outputs and deliverables. Time and
cost delimit or dictate the potential deliverables, as such, in the scope definition they
must be accounted for as constraints.
 Scope statement is the outcome of scope definition. Scope statement describes the main
deliverables of the project, criteria for acceptance of deliverables, assumptions and
constraints.
 In a nutshell the scope definition provide rationale as to why the project has these
deliverables and not others.
 Scope definition describes functions to be fulfilled by the deliverables , brief
background about the problem being addressed or the opportunity being exploited ,
project objectives , user requirements or high level specifications and high level
project tasks or major areas of work.
 The scope also list outcomes or consequences to be avoided such as negative publicity,
interference with other systems, pollution or damage to the natural environment.
 The scope statement is the reference document for all project stakeholders.
 It is the basis for making decisions about resources needed for the project.
 It determines whether or not required or requested changes to work tasks and
deliverables fall within the agreed – upon project scope.
SCOPE CREEP – It means the project keeps growing due to changes in the number or size of
deliverables. If scope creep is not controlled it will lead to runaway project budget and
schedules.

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STATEMENT OF WORK (SOW)

 SOW is a description of the project.

 It includes a scope statement
 It describes deliverables specifications and requirements , deliverables schedules ,
management procedures for communication, planning and handling risks and changes
; project budget and key personnel responsible for administrative and work tasks.
 The SOW is a high level version of the project execution plan.
 The bigger the scope of the project the more complex the breakdown of work will be
done.
WORK DEFINITION

 Translate project objectives and deliverables into specific, well defined work
activities.
 Specify the tasks and jobs that the project team must do.
WORK BREAKDOWN STRUCTURE (WBS)

 Ensure that every activity is identified and clearly defined and that no activities are
missed.
 WBS is a method of sub dividing the overall project into smaller elements.
 Its purpose is to divide the total project into pieces of work called work packages.
 Dividing the project into work packages helps in preparing schedules and budgets and
assigning management and task responsibilities.
CREATING A WBS

 The WBS is a hierarchical decomposition of the total space of work to be done carried
out by the project team to accomplish the project objectives and create the required
deliverables.
 Creating a WBS begins with dividing the total project into major categories. These
categories are divided into subcategories which can also be further divided.
 The level – by – level breakdown makes the scope and complexity of work elements at
each level of the breakdown to get smaller.
 The objective is to reduce the project into many small work elements.
 Each category or element clearly define the project. This makes it easy to plan, budget,
schedule and monitor.
 WBS consist of four levels.

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 Level Element
1 Project
2 Sub – project
3 Work package
4 Activity

 Level 1 is the total project.

 Level 2 is the project broken down into several (4-10) major elements or sub – projects
 Level is made up of pieces of work called work packages.
CONTROL OR COST ACCOUNTS

Control accounts or cost accounts are sub divisions of the project budget. These smaller budgets
represent a work package on the WBS.

 The control account is the basic project tracking elements in the project cost
accounting system (PCAS).
 The accounts are set up in a hierarchy, similar or identical to the WBS.
Like work packages each control account might include:

 A work description
 A time schedule
 Who is responsible
 Material , labour and equipment required
 A time – phased budget
Control accounts help to monitor cost performance easily for each work package, group of
work packages and the project as a whole.

RESPONSIBILITY MATRIX CHART OR ASSIGNMENT MATRIX

 This is a grid that shows the individuals responsible for work packages
 The individuals responsible for the work packages are shown in a responsibility matrix.
 The rows in a responsibility matrix represent the work packages or major tasks and
activities identified in the WBS.

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  The columns represents the persons, groups, departments or contractors responsible for
them. They can also include other stakeholders who need to be noticed about project
matters.
 Letters within the matrix represent symbolise the kind of responsibility
 Primary – ultimate accountability for the work package
 Secondary – assistance or help
 Notification – must be noticed about the work packages status
 Approval – has authority to approve or reject work package
deliverables.
 The matrix is also called a RACI chart – Responsible, Accountability, Consulted and
Informed.
 For each task only one person is assigned primary responsibility.
 The matrix will also be used to signify who will do the work and any other conceivable
kind of responsibility.
 Thoroughly the matrix everyone associated with the project can easily see who is
responsible for what.
AN EXAMPLE OF A RESPONSIBILITY MATRIX (RAM)

PHASE / A B C D E F ……
PERSON
Requirements S R A P P
Functional S A P P
Design S R A I P
Development R S A P P
Testing S P I A P

P= Participant A = Accountable

I = Input required S= Sign off required

R=Review required

 The RAM is used to illustrate the connections between work packages or activities and
project team members.

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  The matrix format shows all activities associated one person and all people associated
with one activity
 This also ensures that there is only one person accountable for one task to avoid
confusion of responsibility.
 The RACI (responsible, accountable, consult and inform) is an example of a RAM.
RACI MATRIX

RACI CHART Person

Activity Ann Ben Carlos Dina Ed
Create A R I I I
charter
Collect I A R C C
requirements
Submit I A R R C
change
request
Develop test A C I I R
plan

R=Responsible A=Accountable

C=Consult I=Inform

SCHEDULING

 Scheduling is a step which comes after requirements definition and work definition.
 Project schedule shows the timing for work tasks and when specific events and project
milestones should occur.
Events and Milestones

 A task or work package is the actual work planned or being done and represents the
process of doing something.
 Work package consumes resources and time.
 In contrast an event shows or signifies a moment in time, when something happens.
 Events represent the start or finish of something.

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  In project schedules each event is attached to a specific calendar date (day , month
and year)
 There are two kinds of events in projects :
 Interface event
 Milestone event
 An interface event signifying the completion of one task and simultaneous start of one
or more subsequent tasks.
 An interface event represent a change in responsibility: one individual or group
completes a task and another individual or group starts the next tasks.
 A milestones event represents a major project occurrence such as completion of a phase
or several critical or difficult tasks. It also represents an important approval or
availability of crucial resources.
o Milestone events signifying progress and they are important measures.
o Common milestones are approvals for system requirements, preliminary design,
detailed design or completion of major tests.
o Failure to pass a milestone is followed by changes to the budget and schedule.
KINDS OF SCHEDULES

There are two common kinds, namely: project schedule and the task schedule.

 Project schedule (project master on execution schedule) is used by the project managers
and upper management.
 It shows all the major project activities but with the limited details.
 Developed during project initiation and refined thereafter.
 It is developed by managers in a top – down fashion.
 They first schedule the tasks identified from the WBS or in the scope statement.
 Later the project schedule is refined in a bottom – up fashion.
They take into account the more detailed task schedules developed by functional managers.

 An activity schedule show the specific activities or tasks necessary to complete a work
package.
 It is created for people working on the activities
 It enables lower level managers and supervisions to focus on those activities and not be
distracted by others which they have no interaction.
 Activity schedules are prepared by functional managers on subcontractors.

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  They incorporate interface and milestone events as specified on the project master
schedule.
Planning and scheduling charts

Gantt charts

The most commonly used scheduling technique is the Gantt chart or bar graph

 The chart gives a visual impression of the progress made on the project or sub
project concerned.
 The starting and completion times of jobs are indicated by the beginning and end
of each bar. Several activities will be done in parallel, which will shorten the
project.
 The bars on the Gantt chart can be used to indicate the durations of the planned
work packages.
 The Gantt chart must be updated on a daily or weekly basis.
 Preparation of the Gantt chart comes after a WBS analysis has identified the work
packages or other tasks.
 Each functional manager, contractor or other responsible for a work package
estimate its time and any prerequisites.
 In every project there is a precedence relationships between the task some

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PART B: SUGGESTED SOLUTION FOR PAST EXAM PAPERS 2016 TO 2017

PRO4801 JANUARY/FEBRUARY 2016

QUESTION 1: Describe the types of systems life cycles models and draw a figure to
illustrate the four – phase

The project life cycle is part of a larger cycle systems development cycle (SDC)

Types of project management life cycle models:

 linear
 Incremental
 Iterative
 Adaptive
 Extreme

Linear - the fine process groups are executed in linear manner. The scope change upsets the
resource schedule. There is no looping back.

Scope- Plan – Implementation – Evaluation and control

Incremental project management life cycle model:

In this model deliverables are released incrementally to a schedule. A partial solution is initially
released and additional parts of the solution are added to the initial release afterwards to form
a complete solution. This model is used to accommodate market demands. The projects ends
with some deliverables and at same time.

Iterative

Adaptive

Extreme

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QUESTION 2: Identify the main source of conflict in each of the phases of the project life
cycle as described by Thamhain and Wilemon (1975: 31-50) what could be the
implications of this conflict be for a project manager? Which methods could be used to
handle this conflict in projects? [15] Pp555

Thamhain and Wilemon determined that the three greatest sources of conflict are schedules,
project priorities and the work force. Project managers generally have limited control over
these areas.

Other sources of conflict identified are technical opinions and performance trade-offs,
administrative and organisational issues, interpersonal differences and costs.

Thamhain and Wilemon found that the sources of conflict change from phase to the next.

During project conception the most significant sources of conflict one priorities, administrative
procedures schedules and labour.

Disputes between project and functional areas arise over the relative importance of the
project compared to other activities, the amount of control the project manager should have the
personnel to be assigned and scheduling the project into existing workloads.

During project definition, the chief source of conflict remains priorities, followed by
schedules, procedures and technical issues. Priority conflicts carry over from the previous
phase, but new disputes arise over the enforcement of the schedules and functional
departments’ effort to meet technical requirements.

During execution, friction arises over schedule slippages, technical problems and labour issues.
Deadlines may become difficult to meet because of accumulating schedule slippages. Efforts
aimed at systems integration technical performance of sub systems quality control, and
reliability also encounter problems. Manpower requirements grow to a maximum and strain
the valuable pool of workers.

During close out, schedules remain the biggest source of conflict as accumulated slippages
make it difficult to meet target competition date. Pressures to meet objectives and anxiety over
future projects increase tensions and personality related conflicts. The phasing in new projects
and the absorption of personality – related conflicts. The phasing of the new projects and the
absorption of personnel back into functional areas create further conflicts.

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 Project Project Project Project
Conception definition execution close out

Priorities priorities schedules schedules

Procedures schedules Technical Personality
Schedules Procedures Manpower Manpower
Manpower Technical Priorities Priorities

QUESTION 3: What are the three levels under which the causes of project management
failure are categorised? Relate these causes to the human factor (the typical human
related aspects) in projects. [10]

Project failure can be classified or categorised into three broad categories:

 People
 Process
 communication

PEOPLE: Failing to motivate and manage people so that project efforts will experience a zone
of optimal performance will lead to failure. Failure to provide the project team members the
tools and techniques needed to produce also lead to failure. The project team must be skilled
and experienced with clear defined roles and responsibilities.

PROCESS: Lack of clear accountability

Root causes of project management failures.

 Bad communication
- Failure to keep everyone is informed about changes assumptions standards, budgets,
costs and the schedule.
 Poor schedule or resource management (mismanagement)
- A schedule is a collection of resources that are being managed on a schedule.
 We requirements definitions – lead to inadequate planning.
- Not knowing the target

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 - Requirements are the target - requirements are what the end results look like in
measurable object terms.
 Inadequate planning, assumptions, risks or resources.
 Use of new or unproven technologies or methods.
 Influence or non-exist quality controls. Quality control is a simple system of checks
and balances to ensure you are delivering what the customer asked for in the first place.
 Managing multiple projects at once or multi-tasking resources. Multi-tasking
introduces comp lenity and schedule risk which can input all projects involved.
 Supply failures contracting out some of the work to your supply chain actually add to
complexity which can lead to causes of project management failures - unless you have
clearly defined requirements agreed to first. Contractors may not have the skill level
required for the task. Contractors’ multi-task in order to stay busy, and multitasking
introduces complexity and schedule risk.
 Scope creep or poor impact analysis.
 Lack of qualified resources. Lack of enough experienced resources.

QUESTION 4: Elaborate on project requirements and indicate the aspects of system or

shareholder needs that these requirements should incorporate. [10]

The Project Management Body of Knowledge defines requirement as a condition or capability

that is required to be present in a product, service or result to satisfy a contract or other formally
imposed specification.

Merriam and Webster dictionary defines requirement as something that is needed or that must
be done.

Requirements define the product behaviour. They indicate what is that users want from the
product.

Requirement is outward facing – specified by the customer/business.

Requirements are capabilities that are required to be present in the product, service or result
that project is supposed to produce in order to satisfy a formal agreement.

Project requirements are conditions or tasks that must be completed to ensure the success or
completion of the project. They provide a clear picture of the work that needs to be done. They
are meant to align the project’s resources with the objectives of the organisation. The benefits

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of effectively gathering project requirements include cost reduction, higher project success
rates, more effective change management and improve communication among stakeholders.

There are different types of requirements, namely:

 Business requirements: Describe why the project is being undertaken. They address
what is required and why the project is happening. For example, to build an eco-friendly
house with high efficiency solar panels that will reduce carbon emissions and reduce
environmental impact.
 User requirements: Describes what the users will be able to do e.g. invoice customer,
pay claim.
 System requirements/solution requirements: Include both functional and non-
functional requirements. These are specific features and characteristics of the product
or service that meet all requirements both business and stakeholder.
o Functional requirements – describe product capabilities e.g. the system shall
notify the operator when the job is completed. Functional requirements also
describe something that a product or service is required to do. For example, a
functional requirement for a solar panel is to convert light into electricity.
Functional requirements have to do with the quality of the project result, e.g.
how energy efficient must an automobile be or how many rooms must a building
have.
o Non-functional requirements – properties the product must have, e.g. response
time, hours of availability. In a nutshell, a non-functional requirement describes
how a system is supposed to function, e.g. to produce electricity at an efficiency
rate of 20%.
 Preconditions: Form the context within which the product must be conducted.
Examples include, legislation, working condition regulations and approval
requirements.
 Operational requirements: Involve the use of the project result. For example, after a
software project has been realised, the number of malfunctions that occur must be
reduced by 90%.
 Design limitations: Are requirements that involve the actual realisation of the project.
For example, the project cannot involve the use of toxic materials or international
partners for whom it is unclear whether they use child labour.

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  Stakeholder requirements: A stakeholder is anyone who has an interest in the product
or service that is being produced or provided. They may be internal stakeholders or
external stakeholders. Every individual stakeholder has specific needs or requirements
that they want to be fulfilled. Each of these needs must be balanced during the course
of the project. Stakeholders have competing needs which can impact the schedule,
budget and scope of the project if not manged effectively.

QUESTION 5: Explain the importance of project termination (closing process) and why
project termination can be approached as a project on its own [5].

At closeout the product or deliverable is handed over to the customer. Project closure processes
represent the formal completion of the project deliverables and their transfer to the final
beneficiaries – usually internal or external customers. This phase also include administrative
closure, which is the termination of activities of the project team, the completion of all project
documentation and a formal sign-off of any contract.

A carefully structured project closure phase should ensure that the project is brought to a
controlled end, which in practice means that:

 All of the project deliverables are formally transferred to others.

 All of the lessons learned from the project are documented and archived.
 Any contracts established by the project are formally closed.

If outside suppliers have been used in the project then this process also involves verification
that all work and deliverables were acceptable, as well as administrative activities such as
finalising open claims, updating records to reflect final results and archiving this information
for future use.

Key activities for the closing process are:

 Obtaining acceptance by the customer or sponsor (approval to close)

 Releasing people and resources
 Reporting on team performance and lessons learned
 Updating or finalising documents, project records and results.
 Finalising procurements.
 Performing quality assurance activities.
 Storing or archiving information.

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Project closure is important because:

 Confirmation of objectives being met. Part of the closure process is to obtain project or
user Acceptance Testing sign off from the client to confirm that the project manager
and his/her team have met the project objectives and meet agreed-upon requirements.
 Sense of closure – confirming that objectives have been met to the client’s satisfaction
gives the client and the project team a sense of accomplishment and closure. Skipping
this step is a big no. It is like a hair dresser giving you a new haircut but not showing
you the mirror in the end to ensure that you like the new cut.
 Improving future engagements: During the project closure process, it is essential that
lessons learned meeting happen with the client and another with internal team.
 Capturing the knowledge: As part of the lessons learnt sessions, the team should
identify project assets (documents or code) that can be re-used in future engagements.
 Tying up loose ends: There are a lot of administrative tasks that must happen ate the
end of a project to make sure the project is appropriately closed from a back-office
perspective. Tasks like sending the final status report, asking for the final payment,
approving all time sheets and re-assigning resources, should all be part of the closure
process to makesure they are executed in a timely fashion.
 Rewarding the team: Recognition of a job well done, make a companywide
announcement to share the successful completion of the project and thanking the team
is extremely important. Also celebrate with the client and thank the key stakeholders
for their support and contribution.

Why project termination can be approached as a project on its own:

QUESTION 6: Draw an AON network diagram and calculate the early times, late
times and the total slack. Also determine the critical path and project duration. [16]

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 F

JANUARY-FEB 2017 B

G
A
C E
J
H
D

6.2 Will you receive a bonus or pay penalty? [1]

6.3 Distinguish between AON and AOA networks [3]

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 AON and AOA are two methods for constructing network diagrams. Activity-on-node
(AON) is called precedence diagramming method (PDM) and AOA (activity-on-arrow)

QUESTION 7: Explain why the WBS is important to the project manager, with
reference to key elements of a work package. Indicate the relationship between the
WBS and organisational structure and explain what a control account is. [10]

Work breakdown structure (WBS) is a procedure which ensure that every necessary activity
is identified and clearly defined. I it is also defined as the method for subdividing the overall
project into smaller elements. Its purpose is to divide the overall project into pieces of work
called work packages. Dividing the project into work packages helps in preparing schedules
and budgets and assigning management and task responsibilities.

More importantly, WBS organises and defines the total scope of the project. The WBS is
decomposed into work packages. WBS provides an unambiguous statement of the
objectives and deliverables of the work to be performed. It represents an explicit description
of the project’s scope, deliverables and outcomes – the of the project. It is foundational
project management component and as such is a critical input to other project management
processes and deliverables such as activity definitions, project schedule network diagrams,
project and program schedule, performance reports, risk analysis and response, control
tools or project organisation.

The WBS identifies the work to be done, the Organisation Breakdown Structure (OBS)
identifies the people that will do the work.

CONTROL ACCOUNT: A management control point at which budgets (resource plans)

and actual costs are accumulated and compared to earned value for management control
purposes. A control account is a natural management point for planning and control since
it represents the work assigned to one responsible organisational element on one program
WBS element.

Each control account integrates the WBS with the project organisation and represents an
agreement or contract with departments or subcontractors to fulfil work package
requirements. The project can be subdivided into smaller budgets called control accounts
or cost accounts, each representing a work package on the WBS.

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 Control account represents organisation’s effort on one WBS element. Control accounts
can occur at various levels since the WBS indenture steps at whatever level represents a
manageable unit of work.

QUESTION 8: Distinguish the formal and informal organisation structures in project

organisations [5]. P.453

Organisations are systems of human and physical elements created to achieve goals. They
are described by their structure – the form of relationships that bond their elements. Two
types of structures coexist in all organisations. One is the formal structure and the other one
is the informal structure.

Formal structure describes normative superior subordinate relationships, chains of

command and subdivisions and grouping of elements. Formal organisations prescribes how
people are supposed to relate, the informal organisation is how they actually do relate. On
the other hand, the informal structure describes relationships that evolve through the
interactions of people.

QUESTION 9: Explain project accountability and why the project manager is

regarded as the project communication hub responsible for integrating everything
and everybody [10].

The accountable person is the individual who is ultimately answerable for the activity or
decision. The responsible person is the individual who actually complete the task. The
responsible person is responsible for action \ implementation. Responsibility can be shared.
The degree of responsibility is determined by the individual with the accountability.

An accountable team member is ultimately answerable for the activity or decision.

Accountability is literally the ability to report on events or experiences. This is the

responsibility to monitor.

Project manager is accountable for the entire project scope, project team, resources and the
success or failure of the project.

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 Being accountable means being responsible for decisions made, actions taken, and
assignments completed.

In organisations, accountability is a management control process in which responses are

given for a person’s actions.

In leadership roles accountability is the acknowledgement and assumptions of

responsibility for actions , products decisions and policies including the administration
, governance and implementation within the scope of the role or employee position.

Accountability also encompasses the obligation to report, explain and answer for resulting
consequences.

A project manager is the communication hub through whom all project information flows.
The manager receives and distribute dozens of messages per day. Customers , suppliers ,
project team members and company executives all rely on the project manager for up to
date information that has been processed and tailored to meet their needs.

There are three critical processes that a project manager uses to meet stakeholders’
information needs and keep the project progressing well:

 Distribute information
 Manage stakeholder expectations
 Report performance

These processes ensure all project stakeholders have the information they need at the right time
and in the right format.

QUESTION 10: List the enemies of cost estimating and explain the PCAS, illustrating
your answer by means of a figure.

Cost estimation and budget are part of the project planning process. Cost estimation logically
follows work breakdown and precedes project budgeting. Accurate lost estimates are
necessary to establish realistic budgets and to provide standards against which to measure
actual costs – they are crucial to the financial success of the project.

Costs in projects have a tendency to escalate over time. Defining clear requirements and work
tasks , employing skilled estimators, being realistic in estimating and anticipating escalation
causes such as inflection all help to minimise escalation.

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Project cost estimating happens throughout all phases of the project life cycle. The first estimate
is made during project conception. Since very little hard cost information is available at that
time, the estimate is the least reliable that it will ever be.

The cost estimating process begins by breaking the project down into work phases such as
design, development and fabrication or into work packages from the WBS. Estimates costs
are classified as recurring and non-recurring. Recurring costs happen more than once and
associated with activities periodically repeated such as quality assurance and testing.
Nonrecurring costs happens once and are associated with dev fabrication of testing of one of
a lend items or procurement of special items.

ENEMIES OF COST ESTIMATING

EXPLAIN THE PCAS

Project cost accounting system (PCAS) is a system which helps to compute estimates, create,
store and process budgets and track costs. PCAS is initially set up by the project manager,
project accountant or project management office (PMO).

The main focus of the PCAS is on project costs, however, the system also assists tracking and
controlling schedules and work progress. The PCAS is used throughout the project life cycle.
During project conception and definition it accumulates work package cost estimate. This
estimate later becomes the basis upon which the project and work package budgets are created.
During project execution, the PCAS accumulates, credits and reports project and work package
expenditures. It creates time-phased budgets which help managers monitor costs and verify
that the work has been completed and charged. The system also enables budget revisions.

ELEMENTS OF A PROJECT COST ACCOUNTING SYSTEM p.392

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 MAY/JUNE 2016 SUGGESTED SOLUTIONS

QUESTION 1

List the typical project planning documents (tools). Describe the six major planning
steps and elaborate on how a WBS (work breakdown structure) may be used to
improve project planning. [10]

Project planning tools/documents

 Project charter
 Is a formal contract or commercial agreement. The charter gather aspects
related to the contracting and contracted e.g.
 The project name, overall goals, and the need it serves.
 A brief description
 A feasibility study
 Project products (files , lectures , training manuals , support ,
monitoring post release)
 Intermediate products (delivered at the end of each stage , such as
reports , updated schedules , results of tests and surveys , third
portal budget presentations.
 Sponsor , manager responsible and key employees (hired out
sourced , allocated from one department to another , employees
under exclusive dedication or part of time).
 Steps defined by the delivery of the products produced).
 Deadlines (timeline with a description of the major processes)
 Resources required (preliminary budget, with values scaled by
steps).
 Restrictions on use of information.
 Procedures required in case of change of scope.
 Procedures required for approval of the products of each step.
 Additional services.

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  Project management plan
 Used as a reference index, encompassing all planning and project
documents.
 Project scope plan
 It documents the project objective and its scope to facilitate dealing with the
changes that arise in the course. The scope is a kind pf briefing script of the
activities, already agreed, needed to meet the project objectives.

 Budget plan
 Project schedule plan
 The progress report it is the set of the project phases , month by month ,
with its prominent tasks , the status of each one (e.g. done , doing , ongoing
or to do) and with the start and expiration dates of the contract. This is the
document most project stakeholders will see or want to see. Generalised
project and task schedules showing major events, milestones and points of
critical action or decision.
 Project team plan/responsibility assignment
 It provides a who – is – doing what view of the project. This document
fosters efficient project execution and shall make the team communication
on transparent as possible. List of key personnel and their responsibilities
for work packages and other areas of the project.
 Project work plan
 This keeps track of the activities work packages, resources, durations, costs,
milestones, project’s critical path, etc. It is on essential document and work
guideline for the core project team.
 Work review plan p 157
 Document policy
 Implementation plan
 Quality assurance plan
 Quality plan it tracks the quality standards of project deliverables will have
to align to. These may typically include product testing approach and tools
quality policies, quality metrics product defect severity grades, acceptance
criteria and cost of poor quality.

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  Project risk plan
 It reports the project risks and their possible saluting in addition to the
opportunities and plans to exploit them to the fullest as soon as they arise.
Risk strategies , contingency and mitigation plans for areas posing great
risk
 Work review plan
 Documentation plan/policy
 Implementation plan
 Health, safety and environmental (HSE) plan
 To address HSE and sustainability matters affecting project workers, the
community and society arising from the project and its end results.
 Communication plan
 Expected meetings reports , participants , formats – formal and informal
 Human resources plan

Budget

 Control accounts and sources of financial support. Budgets and timing of all capital and
developmental expenses for work packages and project.

How a WBS may be used to improve project planning.

A work breakdown structure is the core of project planning, resource management and avoiding
project scope creep. The WBS is used to organise the work into manageable sections often
measured in time, for example, two weeks. By focussing on the bigger picture, the WBS
ensures that no element of the project is over looked during the planning phase. This, in turn,
makes resource allocation much easier.

Once the project is underway, the WBS acts as a roadmap, helping the team deliver the original
requirements. The project sponsor can consult the WBS to gouge the project’s progress and
decide if any adjustments are needed. The WRS will also impact upon any Gantt charts or
dashboard used for project reporting and management.

Describe six major planning steps

Step 1: identify and meet with stakeholders include – pp who hired you to manage the project,
customers and end users. Identify all stakeholders and keep their interests in mind when

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creating the project plan. Meet with the project sponsors and key stakeholders to discuss their
needs and expectations and establish baselines for project scope, budget and timeline. Then
create in scope structure.

Step 2: set and prioritize goals

Prioritise stakeholders’ needs and set specific goals.

Step 3: Define deliverables

Identify the deliverables you need to produce in order to meet the project’s goals. What are the
specific products you are expected to complete? Estimate due to dates for each deliverables.

N.B A deliverable is an element of output within the scope of a project.

Step 4: create the project schedule hook at each deliverables and define the series of tasks that
need to completed in order accomplish each one. For each task, determine the amount of time
it will take the resources necessary and who will be responsible for its completion.

Next identify and dependencies. Do certain tasks need to be completed before others can begin?
Input deliverables, dependencies and milestones into your Work Gantt chart.

Step 5: Identify issues and complete a risk assessment.

Consider the steps you would take to either prevent certain risk from happening or limit their
negative impact. Conduct a risk assessment and develop a risk management strategy to
makesure you are prepared.

Step 6: Present the project plan to stakeholders.

Explain how your plan addresses stakeholders’ expectations and present your solutions to any
conflict communicate clearly.

QUESTION 2

Use figures to demonstrate on understanding of the types of system cycle models and
illustrate the four – phase model of the systems development cycle by means of a figure
[10]

Five different project management life cycle model :

1. Linear p 177
2. Incremental

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 3. Iterative
4. Adaptive
5. Extreme

LINEAR PROJECT MANAGEMENT LIFE CYCLE MODEL

Traditional Project Management (TPM) uses this model. The five process groups are executed
in linear manner. The scope change upsets the resource schedule. There is no leaping buck

SCOPE – PLAN- IMPLEMENT – MONITOR AND CONTROL – CLOSURE

INCREMENTAL PROJECT MANAGEMENT LIFE CYCLE MODEL: 454 – 4

In this model, deliverables are released incrementally according to schedule. A partial solution
is initially released and additional parts of the solution are added to the initial release after
words to form a complete solution. This model is used to accommodate market demands. The
projects end with the same deliverables and at some time.

This approach allows for implementing or launching the end time in a series of increments with
incremental. TPM the end item is implemented step wise, piece by piece, allowing same
elements of it to begin use before the entire item is completed. The lower floors of a building,
for example, are finished and occupied and even though the upper floors are still being
constructed. Decisions about when the increments are to be built and implemented are based
upon dependencies among them and market or financial considerations.

AGILE PROJECT MANAGEMENT

In APM, various iterative and adaptive approaches are used to manage the project. The work
breakdown structure is to be used to slow how the entire project being executed. The clients
and development team collaboration is required for building solution. That means project
manager has to build both client and development team to work together in an open and
collaborative environment. Project manager has to share responsibility and leadership with
client manager.

APM methodologies accommodate uncertainty in an iterative, learn as you go manner. In APM

projects the customer / developer does not know or is unclear about the desired solution and
cannot define the end item requirements up front. The main purpose of the definition phase in
APM is to identify, as best as possible, the customer’s wants and needs. The actual
requirements and features of the end – item will be developed later in a series of iterations.

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Iterative project management life cycle model 53 -44 / 124 – 5 / 455-8

The prototype is developed in this type of project. Each iteration delivers a marketing solution.
The incomplete solution is delivered to the client and asked their feedback on changes or
additions they would like to see. Those changes are integrated into prototype and another
incomplete solution is produced. This process repeats itself until either the client is sacralised
and has no further changes to recommend or the budget and or time runs out.

A prototype an early running model of a system or component built for purposes of

demonstrating performance functionality or providing feasibility.

Adaptive project management life cycle model.

The adaptive life cycle is also called a flexible or change focused method and it responds to
immensely high levels of change as well as the ongoing participation of different parties
involved, The overall scope of a project is broken down out different sets of requirements or
sub – projects that will be undertaken individually.

QUESTION 3

Explain the following in terms of project performance analysis.

3.1 The earned value concept.

3.2 Implementation of creeping scope.

3.3 How the following variances are derived AV, SV, TV, CV (10)

Earned value (p400)

Earned value is a method for measuring project performance. It combines three parameters:
scope, schedule and cost in a single integrated system. EV provides project managers with a
factual way for measuring project performance and predicting outcomes. It enables project
managers to report progress with greater accuracy and forecast any issues / risks ahead of
time.

To assess project performance, the following information is required:

 Planned value (PV) : The approved budget for the work to be completed by a specific
date , also known as the budgeted cost of work performed (BCWS)

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  Earned Value (EV) : Estimated value / worth of completed work by the specified
date also known as the budgeted cost of work performed (BCWP).
 Actual cost (AC) : The costs actually incurred for the work completed by the specified
date , also known as the actual cost of work performed (ACWP)

Benefits offered by EV

 Integrate scope, schedule and cost into one system.

 Improves the planning and forecasting process
 Provides early indication of any risks or issues.
 Improves project accountability
 Contract type does not alter EV calculations.

N.B EV is the earned value or budget cost of the work performed (BCWP). The value of the
work performed so according to the original budget.

Implications of creeping scope

Creeping scope refers to changes continuous or uncontrolled growth in a project’s scope at

any point after the project begins. This can occur when the scope of a project is not properly
defined, documented or controlled.

Adding scope increases the amount of work to be done which increases costs or forces other
scope to be deprioritised. This in turn extends project timelines, require additional staff or
decreases the quality of the finish product.

Project scope leads to resource constraints. As scope balloons , the first reaction is to throw
additional resources at the project which can cause severe resource constraints impacting
other projects and organisations across the business. As the number of resources increases, so
does overhead and productivity is decreased as a result.

PR implications : scope creep can lead to PR nightmares for consulting organisations ,

resulting in failed client relationships and poor customer satisfaction for businesses . Souring
client relationships and low customer satisfaction can impact future business as news of the
issues spread.

Beyond the fallout from delayed projects and lost profit margin, projects with runaway scope
often do not address the core problem from the inception of the project. These projects lack a

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sense of a cohesiveness and the investment into the platform is no longer justified due to the
convoluted scope.

The project will be behind schedule because of all the new requirements. The project will take
more time to be finished.

The project will be over budgeted since the project will take more time to be finished, it will
cost more.

The final product will suffer since the project manager will do his best to remain reasonably
closely to the budget and the planned schedule, he starts cutting some corners here and there
and the final product quality will be lower.

Effects on the project manager

- More stress: scope creep will cause more stress to the project manager.
- Questionable professionalism: scope creep is usually the result of bad project
management or in other words, a bad project manager.

As for the team members, scope creep will cause frustration because they will no longer be
able to see the finish line of the project.

The organisation will be adversely affected by scope creep as expenditure rise and potential
revenue is delayed. The organisation will also probably lose its client because of scope creep.

The customer’s potential revenue will be delayed as well. The customer will be also frustrated
because of the constant delays in the release date and will no longer have high hopes for
the final product.

How these variances are derived AV, SV, TV, CV pp 391 – 2; 405 – 6

- AV - Actual value
- SV - Schedule variance
- TV – Time variance
- CV – Cost variance

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Variance is a measurable change from a known standard or baseline. In other words, variance
is the difference between what is expected and what is actually accomplished.

COST VARIANCE - It is a process of evaluating the financial performance of the project.

Cost variance compares the project budget set before the project started and what was actually
spent. This is calculated by finding the difference between BCWP (Budget Cost of Work
Performed and ACWP (Actual Cost of Work Performed)

Earned value / Budget cost of work Performed - AC (actual cost of the work performed –
ACWP)

The purpose of tracking your finances as your project progresses.

SCHEDULED VARIANCE

It is a quantitative measure used by project management personnel to determine schedule

performance during or after the completion of a project.

Formula: SV = EV – PV

EV represent the actual amount of time taken to either complete the project or progress to the
project’s current stage. The planned value (PV) represents the amount of time which
reaching the project’s current progress should have taken to achieve according to the project
management’s schedule.

Schedule variance approaching zero would indicate that the scheduling and time frames
generated by the project management were accurate within a should margin error. A figure
that is well into negative numbers would mean that either project management overestimated
the amount of time needed or they overestimated the budget and workforce measured in raw
main hours that would necessary to complete the project.

Schedule variance tells how far ahead or behind the project is at the point of analysis.

Interpretation of results

- Is SV is negative , the task is behind schedule

- If SV is zero, the task is ahead of schedule.

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TIME VARIANCE

The difference between the standard hours and actual hours assigned to a job.

Calculating time variance is one way of determining whether a project is a trade to succeed or
needs adjustments.

The time variance is the difference between the estimated time for a task to be completed and
the actual amount of time is required to do so.

If the variance is positive, it was completed ahead of schedules. If it is negative, the task is
behind schedule.

ACTUAL VALUE

QUESTION 4: ANALYSE AND DISCUSS RISK IDENTIFICATION, RISK IMPACT

AND RISK RESPONSE PLANNING (10)

Risk identification

Risk identification is the process of determining risks that could potentially prevent the project
from achieving its objectives. It includes documenting and communicating the concern.

Risk identification is the critical first step of risk management process depicted. The objective
of risk identification of events that , if they occur , will have negative impacts on the project’s
ability to achieve performance or capability outcome goals. They may come from within the
project or from external sources.

There are multiple sources of risk. For risk identification , the project team should review the
program scope , cost estimates , schedule , technical maturity , key performance parameters
, performance challenges , stakeholders expectations as current plan , implementation
challenges , supply chai vulnerabilities , cost deviations , safety , security and more.

Understanding risks is part of the identification process. A risk poorly identified means the
project manager will struggle or fail to communicate this risk to high level stakeholders or team
members. They will not understand the magnitude or an aspect of the risk.

Risk identification allows the manager to create a comprehensive understanding that can be
leveraged to influence stakeholders and create better project decisions. Good risk identification
creates good project communicating and good communication creates good decisions. Risk
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identification is the foundation of good risk management and no fancy tool or spreadsheet will
overcome poor risk identification.

A risk has two primary dimensions it has probability and impact. The probability of a risk
occurring can range anywhere from just above 0 % to just below 100%. The impact of a risk
varies in terms of, costs impact on health, human life or some other critical factor. Knowledge
of the probability and impact of a risk gives the project manager a quick, clear views of the
priority that he / she need to give to each. Decision can be made to decide on what resources
he / she will allocate to managing that particular risk.

Effective risk management requires assessment of inherently uncertain events and

circumstances, typically addressing two dimensions how likely the uncertainty is to occur
(probability) and what the effect would be if it happened (impact).

The risk impacts on a project include poor user adoption , unrealised benefits , late running
projects , overspent budgets , unhappy clients , reputational damage and project failure.

Risk response planning is the process for developing options and actions to enhance
opportunities and reduce threats to project objectives. Risk response planning helps the project
manager to mitigate risks by taking appropriate actions to achieve the project’s objectives
through revision of the project’s schedule , budget , scope or quality. Risk management
should therefore be regarded as an integral part of project management and not as an additional
extra.

Effective risk management demands an active process of regular risk interviews and the
commitment to:

 Anticipate and influence events before they happen by taking a proactive approach.
 Assist in the delivery of project activities in terms of benchmarked quality, time and
cost thresholds.

To achieve risk management which is effective and efficient requires risk response planning.

Risk response planning is the risk action plan where the inputs to this include:

 The risk management plan

 A list of prioritised risks
 A risk ranking of the project
 A prioritised list of quantified risks

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  A probability analysis of the project.
 A risk of potential responses as the risk identification process can help suggest a
response to individual risks or categories of risks.

QUESTION 5

Briefly identify and explain the enemies of cost estimating and explain the PCAS by
means of a figure [10] Chapter 8 pp.275-

Cost estimates are quantitative assessments of the likely costs of the resources required to
complete project activities. Costs must be estimated for all the resources that will be charged
to the project. These includes, equipment, services, facilities, labour, materials, supplies and
special categories such as inflation allowance or cost reserve.

Cost estimates are generally expressed in units of currency e.g. rand or USD in order to
facilitate comparisons both within and across projects. Other units such as hours or days may
be used when making estimates.

Enemies of cost estimates are:

 Cost escalation: This is the amount by which actual costs grow to exceed initial
estimates.
 Uncertainty and lack of accurate information: Much of the information needed for
accurate estimates is simply not available when costs are first estimated. Lack of
the clearest most definitive scope of work, project activities and requirements result
in obtaining inaccurate cost estimates.
 During implementation: Change to product designs or project schedules,
developmental barriers, strikes, legal entanglements, skyrocketing wages and
material costs are the most common enemies of cost estimating.
 Change in requirements or designs lead to scope creep (discretionary, nonessential
changes made to system requirements and plans?
 Economic and social factors beyond anyone’s influence. These include labour
strikes, legal action by interest groups, trade embargoes and material shortages stifle
progress and increase costs. The key factor is inflation. It causes cost escalation and
cash flow difficulties. NB. Inflation is a sustained increase in the general level of
prices of goods and services. The purchasing power of the currency become weak.
 The volatility of the exchange rate

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  Inefficiency, poor communication and lack of control. These include work
inefficiency, poor management and planning, poor communication, lack of
supervision and weak control.
 Ego involvement of the estimator: Some managers are overly optimistic and
habitually underestimate the time and cost especially for jobs where they have little
experience.
 Incorrect information and assumptions: Failure to use current cost rates for labour,
material, equipment and services. Lack of accurate information on available
facilities, equipment, systems and services to be provided by the customer or other
stakeholders are also enemies of cost estimating.
 Bias and ambition: Optimism of project manager can lead to overestimating the
benefits and underestimating the costs.

In order to explain the PCAS by means of a diagram turn to page 292 in the prescribed book.

QUESTION 6

List and briefly explain ten characteristics of project management. Relate this to project
accountability and why the project manager is regarded as the project communication
hub that has to integrate everything and everybody [10]

The characteristic which warrant classifying an activity as a project:

 A project has a defined goal, a purpose with well-defined end items, deliverables,
results or products to achieve specific benefits.
 It is unique: It requires doing something different than was done previously. Because
project management requires a unique variety of skills and resources, project work
might be performed by people from different functional areas or outside contractors.
 It is a one-time activity, never to be exactly repeated again.
 It is a temporary organisation that seeks to accomplish the goal within a scheduled time
frame.
 It utilises people and other resources from different organisations and functions. The
project manager is responsible for integrating people from the different functional areas
or outside contractors.
 Decision making, accountability, outcomes and rewards are shared between the project
team and supporting functional units and outside contractors.
 It carries unfamiliarity and risk.

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  A single person, the project manager, heads the project organisation and works
independently of the normal chain of command.
 The project manager has the overall responsibility to plan, direct and integrate the
efforts of everyone involved in the project (stakeholders) to achieve the project goals.
 Doing a project is a team effort and project management means bringing individuals
and groups together to form the team and directing them towards a common goal.

QUESTION 7

The project charter and project plan are important, explain their importance and indicate how
they relate. Briefly identify and explain the contents of each. Comment on the extent to which
some contents of a project plan may be used in small projects. [15]

QUESTION 8

Distinguish between the formal and informal organisations structures in project organisations
(5)

QUESTION 9

9.1 Indicate the three main differences between AOA and AON networks [9]

9.2 Prepare a network diagram (note use the AON format) and Calculate the critical path
(s) , the early start and finish times as well as the total slack of each activity. In this instance
assume that only one person is working on each activity and show how many person days
will be needed to complete this project. (10)

PR04801 JAN / FEB 2017

QUSTION 1

Explain the following risk identification, risk impact, risk transfer and project risk response
planning [10]

Risk identification is the process of determining which risks may affect the project and
documenting their characteristics (Project Management Institute [PMS] , 2008 : 282).

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The risk identification function should not be left to chance but should be explicitly covered
in a number of project documents :

 Statement of work (Sow)

 Work breakdown structure (WBS)
 Budget
 Schedule
 Acquisition plan
 Execution plan

The objective of risk identification is to identify all possible risks , not to eliminate risks
from consideration or to develop solutions for mitigating risks.

Two approaches to identifying risks.

1. To identify the root causes of risks , that is , identify the undesirable events or things
that can go wrong and then identify the potential impacts on the project of each such
event.
2. To identify all essential functions that the project must perform or goals that it must
reach to be considered successful and then identify all the possible modes by which
these functions might fail to perform.

Risk identification is about reviewing every input variable , activity , key material and
resource (Schuler 2001 : 101)

RISK IMPACT

Risk impact is consequences of risk events if they are realised . The assessment of the impact
each risk event could have on the project. This assessment considers how the event could
impact costs , schedule or technical performance objectives for program management risks
are typically assessed against cost schedule , and technical performance targets.

RISK MANAGEMENT

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The process of identifying , analysing and then responding to any risk that arises over the
life cycle of a project to help the project to help the project remain on track and meet its
goal.

A risk is anything that could potentially impact your projects timeline , performance or
budget.

RISK MITIGATION

Risk mitigation a plan to reduce the impact of an unexpected event. The project team
mitigates risks in various ways :

- Risk avoidance
- Risk sharing
- Risk reduction
- Risk transfer

Risk transfer is a risk reduction method that shifts the risk from the project to another party.
The purchase of insurance on certain items is a risk transfer method. The risk is transferred
from the project to the insurance company . The purchase of insurance is usually in areas
outside the control of the project team. Weather , political unrest , and labour strikes are
examples of events that significantly impact the project and that are outside the control of
the project team.

PROJECT RISK RESPONSE PLANNING

The response planning involves determining ways to reduce or eliminate any threats to
the project , and also the opportunities to increase their impact. Project managers should
work to eliminate the threats before they occur.

The choice of risk response strategies for threats include :

AVOID - focus on eliminating the cause and thus , eliminating the threat.

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MITIGATE – There are certain risks that cannot be eliminated . However , their impact can
be reduced . This is termed as mitigation of risks.

TRANSFER - transfer the risk to some other party . Insurance purchases , warranties ,
guaranties etc are examples of risk transfers.

OUTPUTS OF PLAN RISK RESPONSES

Risk register , project management plans and project documents need to be updated as
outputs of plan risk responses.

RISK REGISTER UPDATES

- Residual risks: There are risks that remain after completion of risk response planning.
Residual risks are those risks that are accepted and contingency plans are developed.
- Contingency plans: They describe the specific actions that can be taken if specific
opportunity or threats occur.
- Risk response owners : Risks can be assigned to individuals who can develop risk
response and also who will implement risk responses if those opportunities or threats
occur.
- Secondary risks : These are those risks which may create due to implementation of
current risk response.
- Risk triggers: The events that trigger the contingency response are risk triggers.
- Contracts: The contracts issued deal with risks should be noted in risk register.
- Fall back plans: Specific actions that are taken if contingency plans or risk response
plans are not effective.

The goal of risk response planning is to come up with options and plans which will allow
an organisation to face threats which can reduce the likelihood of the project succeeding .
Risk response options can be broken down into four methods and these are transfer ,
mitigation , acceptance and avoidance.

QUESTION 2

Explain why the WBS is important to the project manager, with reference to key elements of a
work package .Indicate the relationships between the WBS and organisational structures and
elaborate on the meaning of a control account [15]

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The work breakdown structure (WBS) is a procedure or method of breaking down or
subdividing the overall project into smaller elements . Its purpose is to divide the total
project into pieces of work called work packages.

Dividing the project into work packages helps in preparing schedules and budgets and
assigning management and task responsibilities.

WBS and work packages translate project objectives into specific well defined work
activities . They specify the jobs that the project team must do. This will help to avoid
overlooking and duplicating activities. WBS and work package ensure that every necessary
activity is identified and clearly defined and that no activities are missed.

The WBS process start with the list of the user and system requirements . These
requirements suggest the main system , end-item or deliverables of the project and the
major subsystems and components.

The WBS define all work necessary for the project . However in large projects the initial
WBS is usually rather course and shows any major products or work functions and aspects
of each to be allocated to specific contractors. Work packages subdivide the WBS packages
or elements into smaller and well defined elements.

The work package include :

-Comprehensive SOW : work task or activity to be done.

- Resource requirements : labour equipment , facilities and materials needed for the task.

 Time : estimated time to perform the task.

 Costs : estimated resource , management and related expenses for the task.
 Responsibility : parties , individuals , or job titles responsible for doing and or
approving the task.
 Outcomes : requirements , specifications and associated deliverables , end – items or
results for the task.
 Inputs : preconditions or predecessors necessary to begin the task.
 Quality assurance : entry process and exist conditions to which the task must
conforms as specified in the quality plan.
 Risk : uncertanities , about time , cost and resources associated with the task.

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  Other : additional information as necessary.

Work break down strctures (WBS) identifies tasks and deliverables associated with a project
. Resources are identified for each item within the WBS that facilitates budgeting as well
as assignments, of responsibilities . The WBS can be used to determine the critical path of
the project and create the project schedule.

The WBS is the tool that is used to record and communicate the project deliverables
(something produced or an outcome) and subdeliverables as well as the accomplishments
(something achieved and sub – accomplishments.

Relationship between organisational structure and the WBS.

The work breakdown structure (WBS) identifies the work to be done while the organisation
Breakdown structure (OBS) identifies the people that will do the work.

The OBS and WBS must be brought together before work plans can be formulated ,
schedules prepare and budgets allocated.

Elaborate on the meaning of control account.

Control accounts are smaller subdivisions of the project’s budget , each representing a work
package on the WBS.

QUESTION 3

Describe the statement of work (SOW) and indicate the documents in which it appears.
Distinguish between the statement of work and project charter [15]

The statement of work (SOW) is a formal document that defines the entire scope of the
work involved for a vendor and clarifies deliverables , costs , and timeline. It is needed in
situations where a project involves vendors and external contribution in addition to internal
project team. A sow is created as part of a bid document or part of a contract.

The statement of work should include :

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  All deliverable and due dates.
 The individual tasks that lead to the deliverables and who these tasks are assigned
to.
 The resources needed for the project including facilities , equipment and QA
procedures.
 The governance process for the project.
 Costs and deadlines for payment.

NOTE : The statement of work is description of the project.

 It includes a scope statement.

 It describes deliverable specification and requirements , deliverable schedules ,
management procedure for communication , planning and handling risks and changes
, project budget and key personnel responsible for administrative and work tasks.
 SOW is a high – level version of the project execution plan.
 SOW is associated with contracted projects.
 The SOW appears in documents associated with the contracting or procurement
process.
 The RFP , proposal , contract and project execution plan all contain SOWS , each
an updated , expanded , or more refined version of the SOW.
 It describes the work requirements for a specific project along with its performance
and design expectations.

Distinguish between statement of work and project charter.

SOW PROJECT CHARTER

Provide the business need and the overview A formal document to authorise the project
of intended deliverables. and give the project manager the authority
to spend the project budget.
Includes the business need and the overview Includes project purpose , project success
of the qualities / characteristics of criteria , name the project manager.
deliverables.

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 Created based on the project sow to
authorise the project manager to lack off
the project and spend the budget.
Provides business Provides high level scope
Describes products and services supplied Formally authorise the project
by the project
Describe processes to be used by project. Identify the dependency operational work.

QUESTION 4

Distinguish between project forms of organisation from other forms of organisation.

Differentiate between the following in terms of responsibility and authority project expeditor
project coordinator, project leader in pure project and project leader in a matrix. [15]

Project expeditor – someone selected by the manager of the area wherein the project lies. The
expeditor coordinates decisions , creates and monitors schedules , keep the project moving
and appraises the manager. Has no authority over team members and so must rely on
personation , personnel knowledge and information about the project to influence team
members . An expeditor managed projects within one functional e.g. marketing department can
conduct a project to survey customer attitudes about a new product.

Prowject coordinator – Is a person who manages a multifunctional project or multifunctional

project team. An example of a project that might use a multifunctional team is one develop
on enterprise resource planning (ERP) systems. The ERP is a company wide system that
connects information about forecasting , order entry purchasing and inventory. The project
team would include representatives from all departments that must provide inputs to the
system. The project coordinator has no line authority over team members. He has authority to
make and execute decisions about project budgets , schedules and work performance. The
coordinator report to a high level general manager. The coordinator’s influence originates in
his reporting to a high – level general manager.

QUESTION 5

Develop a paper for a one hour presentation on project management dynamics. Divide your
paper into the following two sections. [10]

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5.1 The process groups in each phase of the project life cycle (5)

5.2 With the emphasise on ten reasons why project management is regarded as dynamic [5]

QUESTION 6

6.1 Draw an AON network diagram and calculate the early times late times and the total slack.

6.2 Determine the critical path and project duration (4)

6.3 State the differences AON and AOA networks (3)

QUESTION 7

Explain the meaning of negative conflicts in projects and why some conflict is natural and
beneficial. In what ways could conflicts be resolved or dealt with [5]

QUESTION 8

Project managers make use of different project integrators. Distinguish between the following
project organisations forms by means of figures.

8.1 Projectised organisations (3)

8.2 Weak matrix (2)

8.3 Balanced matrix organisations (2)

8.4 Strong matrix organisation (3)

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 PR04801 MAY / JUNE 2017

QUESTION 1

Explain why systems approach to project management is essential and indicate how
objectives , elements , sub systems , attributes, environment , boundary , structure ,
inputs , outputs processes and constrains fit into systems thinking [10]

Project management is a systems approach management. A system is a collection of

interrelated components or elements that in combination do something. In this regard a
project can be thought of as a system because it is a collection of elements work tasks
, resources and stakeholders (individuals , teams , organisations)

The focus of the systems approach is to optimise the overall system - not its individual
elements so as to achieve the goal. The approach starts by defining the goal , identifying
components or elements of the system that contribute to or detract from meeting the goal
and then managing the elements to best achieve the goal.

Importance of the system approach

A system approach can provide the management a unified focus with regard to the
direction towards which the business should strive. The approach enabled the
organisation to function as a unit despite being a complex entity.

As an interdisciplinary approach that considers both the business and the technical needs
of year customers , the system approach will ensure quality products that meet user
requirements . This is because the approach systematically integrates all functions into
an interrelated team effort , providing a structural frame work for the development
process that proceeds from concept to production. This ensures that all the system
functions are optimised to achieve maximum compatibility for enhanced productivity.

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 By leveraging feedback , such as assessment of work done , identification of deviations
, and corrective action , changes can be effected to better accomplish the task.

This management approach enables the leadership to see the company as a unified part.

The system approach to management is a concept which views a project as an

interconnected purposive system that consists of several sections. The entire system
can be broken into three parts namely – input , process and outputs.

- Input involves the raw materials, funds , technology etc.

- The process refers to activities related to management , technology , operations etc.
- Outputs are the products , results et.

How objectives , elements , subsystems , attributes , environment , boundary , structure , inputs

, outputs , processes and constrains fit into the systems thinking.

A project can be conceptualised as a system of people , equipment , materials and facilities

organised and managed to achieve a goal.

The term refers to an organised or complex whole – an assemplage of things or parts

interacting in a coordinated way.

Goals and objectives : Human made systems are designed to do something . They have goals
and objectives that are conceived by people. Every system has a broad all – encompassing
statement of the purpose of the system. A system goal is met by achieving a group of system
objectives . A project is a system that exists for the purpose of creating a human made
system. The objectives can be broken down into more detailed , specific objectives called
requirements. Requirements are the specific criteria to which the system and its parts must
conform for the system to meet its overall goals and objectives.

Elements : Any system can be broken down into smaller parts. These parts in combination
for the assemblage of parts that constitutes the system. A element is the smallest of a system.

Subsystems : A system can also be broken down into parts that smaller parts which are
systems on their own. These parts are called subsystems. A subsystems is a system that
functions as a component of a larger system.

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In a project , an element could be a unit of work , a person or group doing the work or a
component of the end – item being produced by the project.

Attributes : These are distinguishing characteristics of systems , subsystems and elements.

Attributes describe the condition of systems , subsystems and elements in qualitative or
quantitative terms. In human made systems , the attributes are designed into the system so
the system will perform as required. The attributes of a system and its components are
monitored to keep trade of the system’s behaviour and performance. In a project , time and
cost are universal attributes of most of its elements and they are tracked to assess the project
‘s performance.

Environment : The term refers to anything outside the system that influences the behaviour
or outcome of the system. It also refers to things over which system designers and managers
have no control . The environment can include the community or society we live in , the air
we breathe , or the people with whom we associate. The environment can be relevant or
irrelevant.

Irrelevant environment includes all things that do not influence the system and that do not
matter. Relevant environment are factors that matter to and affect the system in some way ,
but have to be lived with.

BOUNDARY : It is a physical or imaginary feature which separates a system from its

environment.

Systems structure :

Elements and subsystems are linked together by relationships. The form taken by the
relationships is referred to as the structure of the system. The fuctionating and effectiveness
of a system is largely determined by the appropriatesness of the structure to the systems
objectives or purpose . Most projects have hierarchial structures consisting of organised
levels of sub – elements within elements , elements within subsystems and so on.

Inputs ; Processes ; Outputs ; Interfaces

Systems achieve goals and objectives by converting inputs into outputs through a defined
process. Outputs represent the end results of a system and the purpose for which the system
exists.

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All systems have multiple outputs , including desirable ones that contribute to system
objectives , neutral ones , and undesirable or wasteful ones that detract from system
objectives and / or negatively impact the environment.

Inputs are the raw materials , resources , or steps necessary for the system to function and
produce outputs. They include controllable factor such as labour , materials , information ,
capital , energy and facilities as well as uncontrollable factors such as weather and natural
phenomena i.e. the environment. Inputs that originate from the system itself are called
feedback. For example , all systems produce information for guiding system behaviour is
called feedback input.

Process or function is the means by which the system physically converts or transforms inputs
into outputs.

Constraints : All systems have constraints or limitations that inhibit their ability to reach
goals and objectives . Most constraints are imposed by the environment . Time and money
are also some of the significant constraints in projects.

Integration : For a system to achieve its goal , all of its elements the assemblage of parts
must work in union.

System integration implies that the project team design , implement and operate a system
that achieves its prespecified objectives and requirements through the coodirnated
functioning of its elements and subsystems.

Project management seek to integrate tasks and resources to achieve project goals.

MANAGING CONSTRAINS

The triple constraints can be used to help drive out the goals of the project. Understanding
the constraints and which one carries the most importance will help the project manager
late in the project planning process with things like scope planning , scheduling ,
estimating and project plan development.

PROJECT CONSTRAINTS

Constraints are one of the outputs of the initiation process. Constraints are anything that
either restricts the actions of the project team or dictates the actions of the project team.
The project manager needs to manage the project constraints which sometimes require
creativity.

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 The triple constraints in project management are time, budget and quality. Time constraint
– it usually come in the form of an enforced deadline, the make it happen now scenario. All
activities on a project are driven by due dates. Budget constraints – Budgets limits the
project team’s ability to obtain resources and might potentially limit the scope of the
project. Quality would typically be restricted by the specifications of the product or service.
Time and budget constraints have an impact on quality. A project manager cannot produce
high quality on a restricted budget and within a tightly restricted time schedule.

 Technology constraint – lack of proper technology affect the project finishing time.
 Directions from management can be constraints

QUESTION 2

Explain when project management is not appropriate and list some project type of activities
where it should not be used. Describe organisations or kinds of work where both project and
non – project types of management are an appropriate (15)

 Project management is not appropriate in more familiar and routine

undertakings.
 In a more stable environment, less unique and more standardised end and
the lower the stake in the result, project management is needed less.
 Project management is not appropriate in the production of standardised
industrial and agricultural outputs. These operations are more efficiently
managed tried and true operations planning and controlling procedures than
by project management. For established, repetitive operations, there is much
certainty in the process and outcome. Therefore for such operations,
standardised routine procedures for production planning , scheduling and
budgeting are well suited and project management is not pp 26.

QUESTION 3

Distinguish between the following forms of project management: pure project, matrix,
program, new venture, product committee / task force (15)

Pure project management

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It is a complete , self-contained organisation will be created . The needed resources belong to
the project and do not have to be borrowed . The project involve much complexity , major
resource commitments and high stakes. The project is a separate organisation , sometimes on
independent country created especially for a singularly devoted to achievement of the project
goal. Pure object organisations are headed by the pure project manager. Unlike a coordinator
or expeditor the pure project manager has formal authority over all pp and physical resources
assigned , to the project (maximum control) . The project manager is involved in the project
from start to finish proposal preparation , prepare prelimery budget and schedule estimates ,
hires personnel after acceptance , allocate resources and approves changes to requirements
and the project plan during project execution.

MATRIX

Pure project structures has three variations : pp 491

 The project centre

 The partial project
 The stand alone project

MATRIX ORGANISATIONS

This is an organisation which combine the advantages of both the functional and the projectised
organisation while minimising the disadvantages. Have multiple bosses and are more complex.

PROGRAM

A program is defined as a group of related projects , subprograms and program activities

managed in a coordinated way to obtain benefits not available from managing them
individually . Programs may include elements of related work outside the scope of the discrete
projects in the program. A project may or may not be depart of a program but a program will
always have projects.

In a nutshell , program extends over a large time horizon than a project . It consists of several
parallel or sequential work efforts or projects working to meet a program goal.

NEW VENTURE

Product

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A project may be implemented to create a product. Some smaller projects may be implemented
to incrementally improve the product. The product is what is created as a result of executing
a project. When we are talking about is the work that is being done in the project to produce
and deliver the products of the project.

QUESTION 4

List ten characteristics of project management. Relate this to the contingency view point of
management [10]

Contingency or situational approach to management suggests that the leader should apply
the style that best fits the situation and use the some style for all employees and situations.

Situational leadership weighs the interplay of three variables :

 The amount of direction and guidance a leader gives (task behaviour)

 The amount of socio – emotional support he gives (relations behaviour)
 The readiness for followers to perform the task (maturity). Maturity include the
followers skill or ability to do something and their motivation or willingness to do it.

Ten characteristics of project management

Leadership style

1. It depends on project circumstance . A more directive style may be appropriate when

there is pressure to complete the work quickly. Sometimes the work calls for a more
directive leadership style , that is , the intensity of work serves as the motivator. In a
high paced project there might be little time to build the trust for a more participative
style. In such situations the project manager may need to be more directive and
assertive. In a nutshell , the project manager must be adaptable , able to wear different
style hats and change quickly.
2. Participative Management
The most effective style for project managers is a relations – oriented style –
supportive facilitative and encouraging. Managers seldom gives anders but used
participative management.

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 3. Delegation of responsibility sometimes project managers must gives or tell people
what to do, but in most project situation delegation works best , even when combined
with task oriented – behaviour.
Participative managers do not relinquish responsibility , they delegate it. Leaders
involve others by acquainting them with problems , consulting them for their opinions
and give frequent feedback. Knowledge workers are allowed to help prepare project
plans and budgets. Through such participation they gain an appreciation of how their
work fits in.
4. Motivation and alignment of people . Project leaders align the energies of people and
groups behind the goal . They head by pulling rather than by pushing , by inspiring
rather than by ordering and by creating achievable , challenging expectations and
rewarding progress rather than by manipulating.
5. Project team work / Team building approach
A team is a collection working toward a common goal. All work done in a project
mental and physical is the product of teams . To be successful a project needs
teamwork. Project failures often stem from the malandles of teams : internal conflict
, time wasted on irrelevant issues and decisions made haphazard
6. Team cohesion and shared visions.
7. Conflict (pp557)
Conflict is inevitable in human endeavours and is not simply detrimental . Properly
managed a certain amount of conflict is good because it compels people to sevech for
new approaches , forces to clarify their views , stimulates interest and creativity.
8. Communication management
9. Risk management

QUESTION 5

Explain the following in terms of project performance analysis [10]

5.1 The earned value concept (10)

5.2 Implications of creeping scope

5.3 How the following variances are derived AV, SV, TV, CV (4)

QUESTION 6

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6.1 Draw an AON network diagram and calculate the early start and finish times, the late start
and finish times as well as the total slack of each activity [10]

6.2 Determine the critical path and project duration (In this instance assume that only one
person is working on each activity) (10)

6.3 Using the time chart, prepare a daily assignment sheet for personnel so as to complete the
project in the shortest possible time. Also mention how many days the project could be
compressed if unlimited personnel resources were available (6)

QUESTION 7

Explain the main elements of the PCAS and three areas of emphasis of project control [10]

PCAS is a separate accounting system or cost centre to track and report project specific
transactions , with project revenues , costs , assets and liabilities identified and allocated to
the project.

PCAS is a system which help to compute estimates , create , store and process budgets and
track costs. PCAS is set up by the project manager , project accountant or Project
Management Office (PMO)

The main focus of PCAS is on project costs . The system also assist in tracking and
controlling schedules and work progress.

PCAS is used throughout the project lifecycle. During project conception and definition it
accumulates work packages cost estimates to produce the project cost estimate.

During project execution , the PCAS accumulates , credits and reports projects and work
package expenditures. It creates time - phased budgets which help managers monitor costs
and verify the work that has been completed and changed.

The elements of PCAS are :

 Time – phased budgets for control accounts. This is a method that consolidates the
project budget and the project schedule to show the distribution of budgeted costs
according to the project schedule.
 Total project cost estimates .

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 PCAS is also used to track and control budgets. PCAS divides or subdivides project
budgets into smaller budgeting called control accounts or cost accounts . Each control
account represent a work package on the WBS. Each control account might include :
 A work description
 A time schedule
 Who is responsible
 Material , labour and equipments required
 A time – phased budget

With PCAS and a control account it is easy to monitor cost performance for each work
package , group of work packages and the project as a whole.

QUESTION 8

Project managers make use of different project integrations. Distinguish between the following
project organisations forms by means of figures. [10]

8.1 Projectised organisations (3)

 Arrange their activities into programs or portifolios and implement them through
the projects.
 The project manager is in change of the project and has full authority over it.
Everyone in the team reports to him.
 There will be no functional manager or if he exists have a very limited role and
authority.
 They are adaptive and learn from their own as well as from other’s expriences.
 Most of the resources are utilised in the project work.
 Project manager has full – time team members working under him.
 Project manager has full power and authority over resources to be utilised in the
project . He controls the budget , resources and work assignments .
 When the project is completed the team is disbanded . Team members and all
resources are released.

8.3 Balanced matrix organisation (2)

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  Power and authority are shared between the functional managers and the project
managers.
 A two dimensional management structure (matrix) in which employees are assigned
to two organisational groups - a functional group based on skill sets which has a
functional manager and a specific project group where employees report to a product
manager (horizontal)
 The managers have an equal level of authority with different roles. The project
manager defines the skills needed for the project and functional manager assigns
personnel to fill those needs.
 It is a combination or blend of two or more types of organisational structures , such
as the projectised organisational structure and the functional organisational structure.
 Suitable for organisations operating in a dynamic environment.
 The authority of a functional manager flows vertically downwards and the authority
of the project manager flows sideways.
 Employees may report to many managers.
 The functional manager may look after the functional part of the project . He now may
decide how to do the work and may distribute the project work among his
subordinates. The project manager will have authority over the administrative part
of the project , such as what to do , follow up on the schedule , evaluate the
performance etc.

In balanced matrix organisation structure

 Power and authority are shared between the functional managers and the project
managers.
 Although the project manager has a full time role , he will have a part time or other
wise limited project management administrative staff under him.
 Both managers , control the project budget.

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