Pom100 2024 01 SG

PROJECT MANAGEMENT I
POM100
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ASSIGNMENT
Semester 1 2024
Module name PROJECT MANAGEMENT I
Module Code POM100
Due date 22 APRIL 2024
Total Marks 75
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inside the corresponding Module Class Course on or before 22 APRIL 2024 by
24:00.
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LIST OF REFERENCES
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©STADIO Assignment – 2024 Semester 1 POM100 Project Management I

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Page 2 of 5
Question 1 (25 marks)
You are a project management student working on a case study as part of your
coursework. Your instructor has presented you with a hypothetical project to build a new
sustainable community centre in a densely populated urban area. The goal of this project
is to provide a space for community activities, education, and social services while
minimising environmental impact.
1.1 In your own words, briefly discuss why it is important to conduct a feasibility
study for a project. (2)
1.2 List the two types of feasibility studies that are required for this project. (2)
1.3 There are various steps that should be followed when creating a feasibility
study. You are required to conduct a feasibility study using those steps for the
above-mentioned scenario. (21)
The work breakdown structure (WBS) is a tool that is used to indicate how a project will
be organised in terms of the work that must be carried out. Its aim is to identify tasks and
break them down into smaller units of work. Please answer the questions that follow.
2.1 When designing roles for team members, a project manager can use Morgeson
and Humphrey’s integrative framework of work design. Please use this
framework to discuss the spheres that team members should have. (15)
2.2 Illustrate a WBS with the information provided below. (10)
Project: Mobile App Development
1. Planning
1.1 Requirements Gathering
1.2 Design
1.3 Development
2. Quality Assurance
2.1 Testing
2.2 Bug Fixes
3. Marketing
3.1 Promotion
3.2 Campaigning

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Case Study
Read the case study below and answer the questions that follow.
When the Manager is the Problem
“We try to address conflict as it comes up, before resentments and problems have
had time to fester,” Janet said. “Dealing with conflict can be really tricky. For
example, we had a situation where the boss was causing problems and her
employees were having a difficult time dealing with her. We didn’t find out about it
for a couple of years because employees were afraid to open their mouths,” she
continued. When the problem is a manager, this presents a unique set of problems
for employees. Fear of reprisal is the number one reason employees cite for not
coming forward with employee/manager workplace issues. And sadly, they may be
correct in assuming that their managers will take it out on them if they find out that
employees have been saying things behind their backs. Retaliation can be difficult to
prove if it doesn’t involve whistleblowing or harassment, and no one else comes
forward with complaints.
“In the case of this manager, we later learnt that she had terrible people skills. Often
engineers or other technologists are promoted to the level of manager, but these
individuals mostly lack any kind of people skills. They are promoted because they
are the ‘star pupil’, but it sometimes is not a good fit and can be a disaster.
“This manager used retaliatory practices to get back at employees who complained
about her. People complained that she would berate them in front of other
employees during staff meetings. She played favourites among the employees,
granting special privileges to those individuals whom she liked. Other employees
called these people ‘suck-ups’. Her team suffered from low morale and would
transfer out of her area as soon as another opportunity presented itself.
“The high turnover rate was noticed by HR, but she always had a plausible reason
why someone did not work out. Finally, an incident occurred that broke the issue
wide open and other employees decided to come forward with their complaints.
“There was a very capable engineer on her team who was well-liked and respected
by other team members. He was responsible for resolving all the difficult cases.
(The team was in the software support division where troubleshooting customers’
issues was part of the job.) The job involved talking to customers on the phone and
resolving software problems.
“Call times and problem resolution issues were logged on a monthly basis. Because
this employee took on complicated cases, his resolution times were longer than the

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When the Manager is the Problem
other employees’, as you might imagine. This had never been a problem in the past,
because everyone knew he fixed the really difficult problems. He also was the
project manager of many projects they undertook in IT. Other engineers came to
him when they couldn’t fix something, and he always resolved their issues as well.
“When this manager was hired on to this team, there was immediate conflict
between the two. And to make a long story short, the manager decided to get rid of
this engineer, citing his call times and issue resolution times were too long. He
wasn’t even placed on an employee improvement plan – standard protocol in the
company for underperforming employees. However, everyone knew that she fired
him because she didn’t like him. This caused more fear, yes, but it also caused
resentment. Employees no longer had an experienced mentor they could go to for
help with difficult cases. Call times went up for everyone, and so did the amount of
time it took to resolve issues. Calls stayed longer in the queue as well. The effect
backfired on her, because she now had the highest turnover rate in the Support
Division. We started hearing from other employees about her lack of people skills
and other issues.
“Finally, upper management decided to move her to a position where she could use
her technical skills, but she wouldn’t have employees reporting to her. The company
can’t afford to keep training new employees, so this was deemed a workable
solution, since she had proven skills that could benefit the company.”
Source: Case Studies in Project, Program, and Organizational Project
Management. (2010) Dragan Z. Milosevic, Peerasit Patanakul & Sabin
Srivannaboon: John Wiley & Sons, Inc. All rights reserved
3.1 Briefly define in your own words what a project manager is. (2)
3.2 Discuss the responsibilities of a project manager with reference to the case
example above. (15)
3.3 Discuss the difference between leadership and management. (6)
3.4 What document does a project manager use to deploy resources? Name this
document and discuss it briefly. (2)
Assignment Total: 75 marks

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Table of contents
Heading Page number
TOPIC 1 PROJECT MANAGEMENT WITHIN ORGANISATIONS 1

Prescribed reading 1
1.1 Introduction 1
1.2 The project, project management and project manager 2
1.2.1 Project characteristics 2
1.2.2 Risk and cost profiles 3
Activity 1A 4
1.2.3 The project manager 4
Activity 1B 5
1.3 The project management life cycle 5

1.3.1 The initiation phase 6
1.3.2 The planning phase 6
1.3.3 The execution phase 6
1.3.4 The monitoring and control phase 6
1.3.5 The closure phase 7
Activity 1C 7
1.4 Project management in organisations 8

1.4.1 Organisational strategy 8
1.4.2 The project management office (PMO) 8
Summary 13
Self-assessment questions 13
TOPIC 2 STRATEGY AND PROJECT SELECTION 15
2.1 Introduction 15
2.2 Strategic planning and project alignment 16
© STADIO (Pty) Ltd Project Management I POM100

2.2.1 Planning 16
2.2.2 Strategic direction alignment with projects 17
2.2.3 Strategic objectives and portfolios 17
Activity 2A 18
2.2.4 Project portfolio management (PPM) 19
Activity 2B 19
2.3 Project selection 19

2.3.1 The selection process: The parties involved 20
2.3.2 Project selection methods: Benefit measurement and constrained

optimisation 20
Summary 22
TOPIC 3 THE FEASIBILITY STUDY AND PROJECT PROPOSAL 24
3.1 Introduction 24
3.2 The feasibility study 25
3.2.1 The importance and benefits of performing a feasibility study 25
3.2.2 Types of feasibility 25
3.2.3 The components of a feasibility study 26
3.2.4 Conducting a feasibility study 27
Activity 3A 27
Activity 3B 28
3.3 The project proposal 29

3.3.1 The purpose of a proposal 29
3.3.2 The components of a proposal 29
3.3.3 Guidelines for creating a proposal 30
Activity 3C 30
Summary 31
TOPIC 4 PROJECT STAKEHOLDERS AND SCOPE 34
4.1 Introduction 34
4.2 Project Stakeholders 35

4.2.1 Project stakeholders 35
4.2.2 Stakeholder analysis 36
4.2.3 Stakeholder documentation 36
Activity 4A 37
4.3 The project charter and project scope 38

4.3.1 The project charter 38
4.3.2 Guidelines for creating a charter 38
Activity 4B 38
4.3.3 Planning scope management 38
Notes 39
4.4 The Work Breakdown Structure (WBS) and project teams 40

4.4.1 The WBS 40
4.4.2 The purpose and value of a WBS 40
4.4.3 Components of a WBS 41
Activity 4C 42
Activity 4D 44
4.5 Initiation phase review 44

4.5.1 Overview of objectives 45
4.5.3 Assumptions 45
Summary 47
GLOSSARY OF TERMS 49
REFERENCES 51

List of Figures
Figure Page number
Figure 1.1: Phases of the project management life cycle 12

Figure 1.2: A visual representation of a WBS 14
Figure 1.3: Five categories of PMOs 15
Figure 1.4: Risk management steps 16
Figure 1.5: The six stages of deploying a new project management
methodology 17
Figure 2.1: Levels of strategic planning 22
Figure 2.2: The three baselines of a methodology 23
Figure 2.3: Steps in successful PPM 25
Figure 3.1: Components of the feasibility study 32
Figure 4.1: Tasks in a WBS for publishing a magazine 46
Figure 4.2: A breakdown structure 47

List of Tables
Table Page number
Table 1.1: Functions and fields associated with the PMO 19

Table 4.1: Stakeholder analysis matrix 41

Welcome
Welcome to Project Management I (POM100)!
As a project manager in the making, you have a lot to learn. This study guide is
here to help you take your first steps into the field. By working through this
guide, you will be able to work through the concepts provided in the textbook
and study them with ease. On completion of this guide, you will be familiar with
the project management function and its role within the organisation. You will
also know about the phases projects go through, particularly the first phase,
referred to as project initiation. Finally, you will have a comprehensive
understanding of the tools, processes and documents that project managers use
to run projects efficiently.
We trust that you will enjoy the exciting issues and challenges you will be facing.
We look forward to accompanying you on this meaningful and positive learning
journey.
Module purpose and outcomes
On completion of your first-year studies, you should be able to:

1. Explain the history and development of project management as a
discipline.
2. Determine the necessity for project management application.
3. Define a project.
4. Conceptualise project management.
5. Identify and discuss the project management knowledge areas and types.
6. Conceptualise project management as a function within organisations.
7. Conceptualise project phases and project life cycles.
8. Develop and illustrate a project life cycle for a work-related project.
9. Discuss the nature and characteristics of a project feasibility study in lieu
of the selection of projects.
10. Identify the typical stakeholders in projects.
11. Discuss the role of the various stakeholders in project management.

NOTE
Any reference to masculine gender may also imply the feminine. Singular may
also refer to plural and vice versa.
Prescribed Reading
The prescribed textbook for PROJECT MANAGEMENT I (POM100) is:

Kuhn, S., Anderson, W., Jules-Macquet, R., Huxtable, B. and Musikavanhu, T.
2020. Project Management: From kick-off to close-out. Cape Town: EDGE
Education. [ISNB: 978-1-776-21494-7]
Recommended Reading
The following readings may also be referred to
• Martin (2016), ‘How to Conduct a Feasibility Study the Right Way’.

Cleverism[website]<https://www.cleverism.com/conduct-feasibility-
study-right-way/> accessed 19 October 2018.
• Donovan, D., Ferreira, N. and O’Donovan, J. (2018), Project Management
and Administration. Cape Town: EDGE Learning Media.
• Gratis, B. (2017), ‘Identifying and managing your project stakeholders’.
• Backlog [website] <https://backlog.com/blog/identifying-managing-
project-stakeholders/> accessed 19 October 2018.
• Harvard Business Review [website] (2016), ‘Five Critical Roles in Project
Management’.<https://hbr.org/2016/11/five-critical-roles-in-project-
management> accessed 19 October 2018.
• Lucid Chart [website] (2017), ‘The 4 Phases of the Project Management Life
Cycle’. <https://www.lucidchart.com/blog/the-4-phases-of-the-project-
management-life- cycle> accessed 19 October 2018.
• O’Loughlin, E. (2015), ‘Top 5 Benefits of Using Gantt Charts for Project
Management’. Software Advice [website]
<https://www.softwareadvice.com/resources/gantt-chart-software-
benefits/> accessed 19 October 2018.

Topic 1
Project management within organisations
Prescribed reading
Before continuing with this study unit, please read the following:
● Kuhn et al. (2020): Chapter 1
*Please work through this study guide carefully, as it includes additional information
that is not contained in the prescribed book.
1.1 Introduction
After studying this topic, you should be able to:
• define the terms ‘project’ and ‘project management’;

• identify different types of projects and explain project complexity;
• outline the roles and responsibilities of a project manager;
• discuss the various phases of the project management life cycle;
• identify the role of each phase in the project management life cycle;
• evaluate the role and value of projects within organisations;
• discuss the importance and functions of the project management office; and
• apply your knowledge of projects to both fictional and real-life cases and
scenarios.
We begin the discussion in Study Unit 1, with an attempt to define what a project
is. A project can be defined in terms of success criteria and project
characteristics. Simply put, success criteria are the indicators of a project’s
success or failure. Project characteristics, on the other hand, comprise a wide
range of aspects, including scope, staffing and cost. Projects can also be
categorised under specific types.
Although a complete definition of project management is not easy to formulate,

you can think of it as carrying out a single task in a well-planned and systematic
manner. The textbook also investigates the role of the project manager in a
project.

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A project manager has a limited number of areas (or spheres) in which they can
exercise control – this ranges from control over team leaders, to suppliers, clients
and the like.
It is crucial to note that a project manager’s influence lessens as stakeholders’

proximity to them reduces. A project manager also has a number of
responsibilities, which are linked to the role that they must fulfil, and they must
display leadership. The textbook lists a variety of personality characteristics –
ranging from authenticity, to the ability to work systematically.
In this topic, you will gain knowledge in the following areas:
• The project
• Project management
• The project manager
• The project management life cycle
• The project management office (PMO)
1.2 The project, project management and project manager
1.2.1 Project characteristics
Keshav is a project manager at Wayfinder Camping Gear Co. He is tasked with

managing a project that aims to launch a new product line of entry-level tents
and sleeping bags. First, Keshav needs to categorise the most important criteria
for success. Such criteria may include staying within budget, as the company is
under financial pressure, and achieving a higher-quality standard than the
company’s competitors. Which of the success criteria from Table 1.1 in your
textbook may be most important for this project? Keshav must also consider
other elements or characteristics in order to define the project. Consider the
characteristics that would apply to this scenario by reviewing Table 1.2 and Table
1.3 in your textbook.
As a project manager, you should view project objectives from the client’s
perspective. For example, the client would want a project to stay within budget,
so as not to pay more for the project than is necessary, and they would want a
quality output. In this way, the client’s needs can be viewed as the criteria for
success. Projects also have what are known as project characteristics, such as
well-defined scopes, a shared understanding of scopes, and so on (see Table 1.2
in your textbook). Project characteristics are not abstract descriptions of a
project; rather, they are real, practical decisions that relate directly to the
project. Compare this to other, less important characteristics of a project that
we can identify. If the characteristics listed previously are pragmatic, then these
can be labelled as belonging to the ‘spirit’ of the project.

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They can include aspects such as how unique a project is (i.e. whether it has
been done before) and whether there are any aspects of the project that are
unfamiliar (i.e. areas that have never been dealt with before) (see Table 1.3 in
your textbook).
1.2.2 Risk and cost profiles
Risks and costs are also characteristics that a project manager should consider
closely. Projects typically have risk and cost-to-change profiles. The riskiest part
of a project is right at the beginning, and it is here where costs are the lowest.
The opposite is true toward the conclusion of a project – i.e. risks tend to be
lower, while costs are much higher. This is why it is risky to change aspects of a
project in its later stages, as the associated costs are much higher than in the
earlier stages of the project.
The graph in Figure 1.2 in section 1.3.1 of your textbook illustrates how this
works. If a client wants to make a change at the start of a project, after the
budget, timing etc. have been decided upon, the overall cost of the project may
not be much higher than originally planned. This is because the financial impact
of the client changes can be estimated, and the budget and timing can be
adjusted. However, as the project progresses, the overall cost of making further
changes increases steadily. For example, changes may cause periods during
which no work can be done; however, workers still have to be paid for those
days. As such, costs can snowball, thereby eating into the contractor’s profits.
Similarly, the risk at the beginning of a project is high, as there are many
uncertainties. Will the raw materials be delivered on time? Will the workers
strike? There are a multitude of factors that can make it less likely for the project
to be completed successfully. However, as time goes by, there are fewer
uncertainties and the work becomes more predictable.
Example: Resources
Figure 1.1 in section 1.3.1 of your textbook depicts a graph that shows how time
and the use of resources are related. As time passes, more resources are
required, with the most resources being needed during the execution phase, and
then fewer being needed as the project unfolds.
Consider Andrew, a software project manager, whose software project has now
entered the execution phase. Andrew has a wide range of tasks – more than
during any other phase of the project – that he must complete. These tasks take
up his time and require money, which must come from the project budget.
Andrew’s tasks include:
• selecting and hiring team members;

• identifying bugs in the software that must be fixed;

3
• implementing approved changes;
• communicating with the client;
• holding status meetings; and
• putting out tenders for obtaining new computer hardware.
When most of these tasks have been completed and the project moves on to the
next phase, Andrew will require fewer resources.
Activity 1A
Estimated completion time: 20 minutes
Complete questions (i) and (ii) in Exercise 1A in section 1.3.2 of your textbook.
1.2.3 The project manager
It used to be that a project manager controlled only schedules, budgets and work
assignments. However, the role of the project manager has become much more
complex. A project manager must now display the knowledge and skills that they
have accumulated throughout their career.
A project manager has five major responsibilities:
1. They must bear responsibility for the project as a whole, and they must act
as a team leader. Since this requires effective communication, the ‘Triple C’
model of communication (communication, cooperation and coordination) can
be very effective.
2. They must be an advocate. This requires, for example, negotiation and
persuasion skills, so as to ensure the best outcome for the project.
3. They must remain informed of developments within their fields – e.g.
construction methods, information technology (IT) etc. In this way, they
must remain a student, always looking to learn more by, for example,
completing continuous professional development (CPD) courses.
4. They should take on the role of teacher, transferring their knowledge to
others, such as team members and other managers.
5. They are a diplomat, acting as a facilitator across a variety of disciplines.
Leadership is a key characteristic of a project manager. In order to be a

successful project manager, you must be authentic, creative, courteous, service-
orientated and systematic, among other things.

4
NOTES
Watch the following video in order to understand what a project manager does
on a day-to-day basis, as well as on a weekly basis:
https://www.youtube.com/watch?v=vMWJyELLSQ4
Watch the following video in order to expand your understanding of the different
types of projects that can be implemented in organisations:
https://www.youtube.com/watch?v=2SJDweV47jw
Activity 1B
Watch the following video, and then answer the questions that follow:
https://youtu.be/POuGKD3xLqs
Required:
(i) Differentiate between the delivery process and the project management
process.
(ii) Explain why the level of activity in executive monitoring and controlling
functions decreases over time.
1.3 The project management life cycle
Think back to the introduction of this topic and consider how a project manager
like Keshav will need to lead their team and project through five distinct phases
in a project’s life cycle. Have a look at the following figure. Can you recognise
each phase and elaborate on what is required from Keshav in each one?

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Figure 1.1: Phases of the project management life cycle
Source: EDGE Education (Pty) Ltd (2021); and Flaticon
As mentioned, the project management life cycle consists of five stages. Let’s
see how they apply to Keshav’s project.
1.3.1 The initiation phase
The two most important documents during the first phase of a project include
the business case and the feasibility study. In creating the business case, Keshav
will determine why there should be a new product line in the first place. In the
feasibility study, he will describe the likelihood of the project’s successful
completion within specific parameters (e.g. the availability of resources, such as
cash or credit), as well as any potential risks associated with the project.
1.3.2 The planning phase
The most critical phase of a project does not consist of a single plan, but rather,
a collection of project plans, each of which serves its own function. Read over
section 1.6.2 in your textbook, which describes a series of basic plans used in
project management. Which of these do you think Keshav can use?
1.3.3 The execution phase
During the execution phase, the resource plan, work breakdown structure (WBS)
and schedule plan are used. Here, Keshav will assign resources and carry out
other tasks that will contribute to achieving the desired project deliverables.
1.3.4 The monitoring and control phase
Even though the monitoring and control phase is listed separately, it is something
that Keshav will have to do continually, throughout each phase of the project
management life cycle. In other words, the monitoring and controlling phase
takes place concurrently with all of the other phases.

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This phase is important, as it indicates whether performance is adequate, and
whether tasks and processes are efficient. Moreover, monitoring and controlling
are used in order to control any deviations to the project plan.
1.3.5 The closure phase
During the final phase of the project, Keshav will finalise the deliverables, namely
launching the new tents and sleeping bags. He will also ensure that the project
documentation is catalogued and archived, and he will have a debriefing meeting
with the key stakeholders. Here, Keshav and the stakeholders will evaluate the
project in terms of its successes and failures.
NOTES
To revise your knowledge of the project management life cycle, you can watch
the following video:
https://youtu.be/BIgbwM2ieU8
Activity 1C
Complete questions (i) and (ii) in Exercise 1C in section 1.5.2 of your textbook.
Example: Work breakdown structure
Refer back to Table 1.4 in your textbook, where the work breakdown structure
is listed as a type of project plan. We will discuss the WBS in more detail later in
this guide. For now, here is a simple example.
Imagine that you are a project manager who is overseeing the construction of a
house. During the initiation phase of the project, you will use a WBS to divide
the entire project into several tasks and sub-tasks. The WBS in the following
figure provides a visual representation of how the project is subdivided.
First, the project’s key aim is stated, while the subdivisions that follow outline
the different phases that will take place. In this example, the phases take place
sequentially; however, in reality, several phases are likely to take place
concurrently. The first phase involves laying the foundations, and only once this
phase is complete can the next phase – building the walls – begin. However, in
order to complete the construction of the walls, other activities must take place,
such as buying the bricks.

7
The final phase involves building a roof on top of the walls. This phase will also
be subdivided into several sub-tasks, such as choosing and buying the tiles and
preparing the roof trusses.
Figure 1.2: A visual representation of a WBS
Source: EDGE Education (Pty) Ltd (2021)
1.4 Project management in organisations
1.4.1 Organisational strategy
It is important for a project manager to have a good understanding of

organisational strategy. Organisational strategy refers to the process that leads
to the achievement of long-term goals. This process consists of short-term
projects that can be viewed as stepping stones to reaching the goals of the long-
term strategy.
1.4.2 The project management office (PMO)
The responsibilities of the PMO can be considered in terms of supporting,

controlling and directing a project. These responsibilities can range from training
staff and project managers, to managing archives and administration. Refer to
pages 19–20 of your textbook for an outline on the six broad functions of PMOs.
PMOs can be placed into five different categories, as listed in the following figure.
These categories are based on the particular office’s functions (what it must do)
and at which level of the project management organisation it operates.

8
Figure 1.3: Five categories of PMOs
Source: EDGE Education (Pty) Ltd (2021); adapted from Kuhn et al. (2020: 20)
1.4.3 Reporting structure
In a PMO reporting structure, the project staff report to the project manager. In
turn, the project manager reports to the PMO, which processes and relays the
information to the chief executive officer (CEO). Figure 1.7 in your textbook
provides a helpful graphic representation of this reporting structure.
PMOs have five specific functions, as discussed in section 1.8.2 in your textbook.
A PMO’s governance function oversees projects and ensures accountability
regarding aspects such as the financial auditing of a project. A PMO also ensures
that dealings are transparent, which is done by making documentation available.
It is important for a PMO to ensure that information is reusable; for example,
ensuring that information can be used as reference for future projects. In order
for this to be possible, the PMO must make information traceable. For example,
if a specific invoice needs to be retrieved in order to check whether it was paid,
it should be easy to do so. A PMO also supports project delivery by helping with
training, mentoring, and so on.
1.4.4 Project management governance
An organisation should ensure that the functions of the PMO are aligned with its
organisational strategy, as this increases the chances of the project being a
success. The following figure unpacks the three central pillars of governance.

9
Figure 1.4: Risk management steps
Source: EDGE Education (Pty) Ltd, (2021); adapted from Project Management
Qualification (2019)
1.4.5 Project management methodology (PMM)
Several project management methodologies (PMMs) have been developed over

the years. When an organisation wants to introduce a new methodology, it is the
responsibility of the PMO to implement it, according to the process explained in
section 1.8.4 of your textbook.

10
Figure 1.5: The six stages of deploying a new project management
methodology
Source: EDGE Education (Pty) Ltd (2021) adapted from Kuhn et al. (2020: 22)
There are several methodologies that can be used, as outlined in Table 1.5 in
your textbook. The following methodologies are the most commonly used:
• Waterfall: Here, work is carried out in sequential steps, as opposed to agile

and scrum, where tasks are divided and carried out in different sequences.
• Agile: Here, teams collaborate and work together. This methodology is often
used in the field of software development, where employees’ skills are not
concentrated in one area only, but rather, are used wherever needed as and
when required. In other words, people do not perform only one job.
• Scrum: With this methodology, work is done in sprints, which are dedicated
periods of working on a task. Any tasks that are not completed in time are
backlogged and completed later in future sprints. The term ‘scrum’ refers to
a concentrated effort within or among teams.
• Kanban: This is a visual representation of the workflow. It is usually in the
shape of a board, showing the progress of the subdivided tasks of a project.
• Six Sigma: This methodology uses software and data to improve projects
and the processes within them. Common software packages include IBM
WebSphere, JMP and Oracle Crystal Ball, to name a few.
• Project Management Body of Knowledge (PMBOK): The PMBOK is a collection
of standardised processes and terminology in project management and is
updated every few years.
• Lean: Here, the focus is to prevent wastage in the project, such as time,
money etc.
• Scrumban: This is a combination of scrum and kanban methodologies. It is
typically used when teams are migrating their methodology from scrum to
kanban.
Example: SCRUM
Johan is approached by a customer who needs a software product backlog

cleared. He therefore devises a scrum approach in order to meet his client’s
needs. First, Johan’s team selects the most important tasks to be completed over
the next three weeks – this is referred to as the sprint period. The team has a
daily meeting (the scrum meeting) to identify work that must be completed on
that day, as well as any obstacles to the completion. When a sprint is completed,
the work is delivered to the client and the backlog is assessed again. The next
sprint begins when a new task is selected from the backlog for completion. This
process repeats until the entire backlog is cleared.
Source: EDGE Education (Pty) Ltd (2021); adapted from Altvater (2017)

11
1.4.6 Project management processes
The PMO is responsible for industry compliance and accountability, and it must
provide documentation for these. It also ensures that the organisation adheres
to certain standards, such as industry standards or financial reporting standards.
The PMO may ask a project manager to submit a document such as a project
charter in order to determine whether the project standards have been met. It
then decides which documents are necessary and how they must be formatted,
for instance.
1.4.7 Project management software tools
Project management software offers great precision and speed to modern project
management. Before purchasing any software, an organisation must ensure that
the software chosen conforms with its policies concerning issues such as privacy,
copyright and licensing. The PMO and the IT department manage and furnish the
software licences, as well as conduct training and compliance reviews, for the
software that is used. For more information on project management software
tools, you can refer to section 1.8.7 in your textbook.
1.4.8 Non-strategic projects
Not all projects are of strategic importance to an organisation. In other words,

some projects do not contribute directly to the specific goals of the organisation.
Such projects, which are known as non-strategic projects, play a support role.
They are carried out in order to ensure the longevity of strategic projects; for
example, computer network maintenance projects. The management of non-
strategic projects is also undertaken by the PMO.
1.4.9 Associated fields and departments
PMOs do not operate on their own; rather, they rely on other fields and
departments to manage and deal with specific issues. Examples of these
associated fields and departments are listed in the following table.
Table 1.1: Functions and fields associated with the PMO
Stakeholder Legitimacy
Accounting Manages financial matters such as budgets
Human resources (HR) Manages conflict resolution, employment contracts
and payments
Information technology Manages and maintains software and computer
infrastructure
Legal Oversees legal matters such as regulations and laws
pertaining to projects

12
Logistics Provides for transport needs in the organisation
Marketing Works at making potential customers aware of
products and services
Sales Finds customers and manages sales processes
Support Provides customer support
If you are unsure of any of the fields listed, refer to section 1.9 in your textbook
for more details.
Case study:
Refer to the ‘Project management in practice’ case study in section 1.10 of your
textbook.
Summary
In this topic, we discussed how to define a project, and we investigated project

characteristics and success criteria, such as budgeting, client expectations etc.
Projects have several characteristics, derived from crucial aspects such as project
scopes, which should be well defined and understood by all stakeholders. We
also unpacked the four basic categories under which projects can fall:
manufacturing, construction, management and research. We then moved on to
a discussion regarding how to define project management. Project management
can be defined in terms of the knowledge and skills that the project manager has
accumulated over the course of their career. Moreover, it brings together
resources in order to accomplish a single goal in a systematic manner. Finally,
we looked at the role and responsibilities of a project manager, as well as the
leadership characteristics that form part of this role.
Self-assessment questions
1. Select the correct answer from the options provided.
A project manager has several responsibilities, one of which is being an

advocate. What does this refer to?

13
a. The project manager represents the organisation in court cases.
b. The project manager oversees marketing the organisation’s services to
stakeholders.
c. The project manager leads efforts in motivating staff or employees on
the project.
d. The project manager provides sufficient evidence to other leaders and
managers that the project is viable for the organisation.
2. Identify whether the following statements are true or false. (If false,
substantiate your answer.)
a. The monitoring and control phase takes place after the execution phase
and before the closure phase.
b. A manager who is adept at using their influence and developing
beneficial relationships is said to have good political personality
characteristics.
3. Match the following concepts in Column A with their correct descriptions in

Column B.
Column A Column B
a. Educator 1. Fulfils roles across disciplines and organisations
b. Diplomat 2. Stays up to date with industry trends
c. Student 3. Develops a professional discipline in different
environments
4. Unpack any three main functions of a project management office.
4. Compare and contrast the agile project management methodology with

the waterfall approach.

14
Topic 2
Strategy and project selection
Prescribed reading
● Kuhn et al. (2020): Chapter 2, sections 2.1 to 2.4
2.1 Introduction
• discuss the importance of project initiation as a definitive phase in completing

a project successfully;
• outline the importance and benefits of aligning projects with organisational
objectives and strategies;
• unpack the project selection process, making reference to the role players
involved and the various methods that can be implemented;
• apply your knowledge of project initiation processes to both fictional and
real-life cases and scenarios.
In this topic, we will discuss strategic planning, project alignment and project
selection. Strategic planning is concerned with the spending of resources, while
business planning focuses on resourcing, as well as how those resources will be
applied. We will then unpack the standard methodology for project management,
along with the project definition and its various baselines. Importantly, when
taking on a project, an organisation must ensure that the project aligns with the
organisation’s strategic direction and strategy. Moreover, the organisation must
ensure that the portfolio of the project aligns with the organisation’s objectives.
In this topic, we will also explore how a project is selected, as well as the parties
involved in making the selection. The topic ends with a discussion on two
methods for making selections, namely benefit measurement and constrained
optimisation.

15
• Strategic planning
• Project alignment
• Project selection
2.2 Strategic planning and project alignment
2.2.1 Planning
An effective strategy can be achieved only through thorough planning. There are
two types of planning, namely business planning and strategic planning. A
business plan is a starting point, while a strategic plan outlines the tools that are
needed. A strategic plan must align on several levels, as illustrated in the
following figure.
Figure 2.1: Levels of strategic planning
Source: EDGE Education (Pty) Ltd (2021); and Flaticon; adapted from Kuhn et
al. (2020: 33)
Can you identify what falls under each of these levels? Refer back to section 2.1
of your textbook for more details on each level.
Methodologies are also important, and they must be adapted to an organisation’s

needs (i.e. its strategic objectives). Can you differentiate between simple and
complex methodologies? Can you explain why simpler methodologies are

16
preferred? For more information on methodologies, read though pages 33–35 of
your textbook.
When selecting a methodology, it must first be defined. This can be done by

dividing it into three categories, known as baselines. The following figure reveals
what each baseline consists of.
Figure 2.2: The three baselines of a methodology
Source: EDGE Education (Pty) Ltd (2021); adapted from Kuhn et al., (2020:
34)
2.2.2 Strategic direction alignment with projects
Section 2.3.1 in your textbook covers the importance of aligning a project with
an organisation’s strategic direction. The balanced scorecard is a strategic
management performance tool that can be used in this regard. The balanced
scorecard is ‘used to identify and improve various internal business functions and
their resulting external outcomes’ (Tarver, 2021). As such, it is used in order to
achieve alignment by translating abstract strategy into concrete actions.
2.2.3 Strategic objectives and portfolios
In the same way that an organisation’s strategic direction should align with a
project, its strategic objectives should do the same. Understanding this process
requires you to grasp the distinction between a project, a programme and a
portfolio. Simply put, a project is the smallest unit in a portfolio. It has a limited
lifespan and results in the creation of deliverables. A programme and its
subprogrammes are made up of interrelated projects, which work toward a single
goal. A project portfolio encompasses both the programmes and the projects,
and is therefore linked to the strategic objectives of the organisation.

17
Example: Strategic objectives
Phiwe has recently purchased a company that produces hemp products. As the
new CEO, she has had to create new strategic objectives for the company and
present them to the employees and other stakeholders. Phiwe has set the
following objectives for the company:
• Grow shareholder value: Increase the value of shareholders’ investments in

the company.
• Increase revenue: Open more stores in order to increase sales.
• Cross-sell products: Offer customers products that are related to what they
have purchased (e.g. sell hemp shirts, as well as ties made of hemp).
• Improve technical and analytical skills: Upskill employees to make use of
modern manufacturing techniques.
• Ensure compliance: Create a compliance office, which has the sole task of
keeping the company within regulatory requirements; for example, ensuring
that sourcing is ethical, labour practices are met, environmental conservation
laws are followed etc.
• Invest in customer management: Grow customer loyalty and interaction by,
for example, adopting customer relationship management (CRM) software
for sales, marketing and customer support staff.
The strategic objectives set by Phiwe can be categorised into four basic types:
1. Financial strategic objectives
2. Customer strategic objectives
3. Growth strategic objectives
4. Internal strategic objectives
Can you classify each of Phiwe’s stated objectives according to these basic types?
Source: EDGE Education (Pty) Ltd (2021) adapted from Weaver (n.d.)
In the following activity, you will learn more about the balanced scorecard.
Activity 2A
https://www.youtube.com/watch?v=UnBR9J0Tq88
Required:
(i) Explain how the balanced scorecard aids budgeting and strategy alignment.
(ii) In your own words, explain what the speaker means when he says that risk
management is the flip side of performance management.

18
2.2.4 Project portfolio management (PPM)
The project portfolio manager is responsible for deciding which projects should
and should not be developed. This selection should be made based on the
organisation’s overall strategic objectives, and the projects must be aligned with
the organisation’s objectives. Although projects should not necessarily be aligned
to all of the objectives, they must not pursue objectives that are irrelevant to the
core goals of the organisation. Project portfolio management (PPM) is
implemented successfully through a process of five steps, as outlined in the
following figure. You may agree that step 2 is a vital decisive factor in
determining which projects to take on.
Figure 2.3: Steps in successful PPM
Activity 2B
Complete questions (i) and (iii) in Exercise 2A in section 2.3.2 of your textbook.
2.3 Project selection
Project selection is important, as an organisation operates within constraints,

such as a budget. Additionally, it is natural for an organisation to grow and
discover that its needs are changing.

19
2.3.1 The selection process: The parties involved
The three parties that should be involved in the selection of suitable projects
include management, a project manager and stakeholders. Table 2.2 in your
textbook provides a summary of each party’s role. Management is required to
grant permission for a project to be taken on, as well as provide guidance. The
responsibility of a project manager is to communicate between the parties
involved, provide oversight and guide the project roll-out. Stakeholders are a
diverse group. They can be individuals, groups or even organisations that have
an interest in the project. Stakeholders can be divided into two categories,
namely internal and external stakeholders. Examples of each group are provided
in Table 2.3 in your textbook.
While the type of stakeholders (internal or external) involved in a project

depends on the type of project in question, management and project managers
will always be involved in project selection. It is management who, in
consultation with project managers, decides whether to widen consultation when
selecting new projects.
Next, we will look at a few methods for project solutions.
2.3.2 Project selection methods: Benefit measurement and constrained

optimisation
Benefit measurement and constrained optimisation are two project selection

methods that are discussed in your textbook. The benefit measurement method
is better suited to less complex projects, and it is used to estimate the inflow and
outflow of cash. There are eight approaches that can be identified within the
benefit measurement method:
1. Benefit/cost ratio: This is an expression of the cost as it is projected currently

and the project’s value of return. A high benefit/cost ratio is more beneficial
than a lower ratio.
2. Economic Value Added (EVA): The EVA measures the net profit of a project
after taxes and expenses. Usually, the project with the highest EVA is
selected for development.
3. Scoring model: A committee selects a project by identifying criteria that are
believed to be relevant to the project. The committee then assigns a value
to each criterion in terms of its significance in the project, and then adds up
the weighted values to determine which project has the highest total score.
The project with the highest score is then selected.
4. Payback period: The payback period is how long it will take for a project to
repay its original cost. This is calculated using a financial equation.
5. Net present value (NPV): Projects with a high NPV are typically selected for
execution. The NPV is derived by subtracting a project’s existing cash
outflows from its present cash inflows.

20
6. Discounted cash flow: Since the spending power of money decreases over
time, future cash flows must be adjusted or discounted and taken into
account when calculating the total cost of an investment.
7. Internal rate of return (IRR): The IRR is a more complex method and is
calculated by means of a financial equation. It is the point at which current
cash inflows are equal to current outflows. It is a measure of profitability,
and as such, projects with higher IRRs are usually selected for execution.
8. Opportunity cost: The opportunity cost is the cost that is lost when selecting
a less profitable project over a more profitable one. Therefore, the project
with the lowest opportunity cost is typically selected for execution.
NOTES
For a further explanation on the IRR, watch the following video:
https://www.youtube.com/watch?v=b3sZIjkRpak
The constrained optimisation method is applied for larger and more complex
projects that have longer timelines. There are five approaches to this method,
which are outlined in section 2.4.2 of your textbook:
1. Linear programming: This approach is used to optimise the use of resources.

2. Non-linear programming: This approach is used when project variables
present uncertainty or a range of possible outcomes.
3. Integer programming: This approach is useful for scheduling in a project that
has continuous and separate concurrent activities.
4. Dynamic programming: This approach is applied in order to break down a
project into smaller entities (sub-problems), and to select the least costly
and most beneficial solutions.
5. Multiple objective programming: This approach is used when several
different objectives are being targeted, and there is a risk that objectives will
clash. This approach is designed to provide a project manager with the ability
to consider various objectives at the same time.
Example: Payback period
Suppose that Phiwe’s project manager, who is responsible for setting up the new
server infrastructure, must decide on which hardware to purchase, based on how
long it will take to pay back its original cost. The cost of the new server
installation and its infrastructure is estimated at R 1 000 000, and the projected
annual average cash inflow is projected to be R 950 000.
Cost of project
The payback period =
Average annual cash inflows

21
R 1 000 000
Next, the values are substituted: = 1.05
R 950 000
Therefore, it will take roughly 1 year and 1 month to repay the original cost of
the project.
Summary
In this topic, we discussed the role players in the management of a project and
the different methods of project selection. Role players can be separated into
three categories, namely management, project managers and stakeholders –
each of whom have their own set of responsibilities. Stakeholders can be further
identified as internal and external stakeholders, and the type of stakeholders
(internal or external) involved in a project depends mostly on the nature of the
project. Stakeholders should also be consulted during project selection, as they
provide valuable input. We concluded this topic by identifying two methods that
can be used when selecting projects, namely the benefit measurement method
and the constrained optimisation method.
Each of the following are standard baselines of methodologies for project

management, except:
a. The technical baseline

b. The functional and management baseline
c. The work breakdown baseline
d. The financial baseline
a. A project can consist of multiple programmes.

b. On a balanced scorecard, organisational financial statements are
strategic indicators from an internal process perspective.
c. A statement of work forms part of the technical baseline.
d. The balanced scorecard can assist in reaching internal synergy within
an organisation.

22
3. Discuss the link between NPV and IRR as methods of project selection.
4. Compare and contrast dynamic programming and multiple objective

programming as methods for project selection.
5. Dineo is a new project manager at ABC Construction and is tasked with

compiling a technical baseline regarding the project definition. Discuss the
information that he needs in order to construct this baseline.

23
Topic 3
The feasibility study and project proposal
Prescribed reading
● Kuhn et al. (2020): Chapter 2, sections 2.5 to 2.8
3.1 Introduction
• differentiate between different types of feasibility and detail the process of

conducting a feasibility study;
• apply best practice guidelines to create the components of a proposal; and
Cloudburst, a fictitious Internet service provider, wants to enter the cloud hosting
business. It wants to manage online storage space and software as a service
application for customers. To do this, the company needs to acquire expensive
hardware, which requires a large amount of capital. This is a risky venture, and
it will need to be managed well, as it will consist of various distinct projects. First,
the company will need to test whether the project is feasible. Does the company
have the required means and capabilities to implement the project? Questions
like this one need to be addressed in the feasibility study.
The importance of a proper feasibility study cannot be emphasised enough.

Section 2.5 of your textbook discusses the various facets that a project manager
should pay attention to when compiling and conducting a feasibility study. A
project proposal draws upon the feasibility study and is arguably the most
important document for stakeholders – especially when they are clients or parties
that will provide funding or invest in the project.

24
• The feasibility study

• The project proposal
3.2 The feasibility study
3.2.1 The importance and benefits of performing a feasibility study
A feasibility study is a collection of all the elements that need to be considered

in order to determine whether it is possible for a particular project to be executed.
It requires a methodical approach, as there are a range of issues that it must
cover. Conducting a feasibility study is valuable for several reasons, which are
discussed in section 2.5.1 of your textbook. Let’s highlight a few of these reasons
as they apply to Cloudburst’s planned business venture.
Conducting a feasibility study will help Cloudburst to develop a focused view of

what exactly it aims to offer consumers. It will also help the company to identify
any alternatives to the offering that may be more viable (worthwhile). Through
the study, Cloudburst may find that the market is too crowded, or that there are
other services that are more sought after at the moment. The study is also useful
for identifying whether or not the project selection process has been carried out
successfully. Furthermore, the study can serve as a foundation for decision-
making, which is useful for the project manager.
A proper feasibility study will increase the chances of the company being
successful in obtaining loans and investment funding. This is because it will
enable prospective investors to decide whether to supply capital, based on the
contents of the study.
A feasibility study also highlights the risks of a project, as well as potential plans
to mitigate these risks. For example, Cloudburst may find that the price of data
drops suddenly, due to larger players in the market making competitive moves
against each other.
Lastly, a feasibility study creates a type of roadmap for the complete life cycle of
a project.
3.2.2 Types of feasibility
Before conducting a feasibility study, it is important for Cloudburst to be aware

that there are several types of feasibility studies that can be used.

25
Section 2.5.2 in your textbook discusses the six types of feasibility analysis –
each of which answers certain questions:
1. Financial feasibility: Will the project be profitable and financially viable – i.e.
is it worth undertaking?
2. Technical feasibility: Does the organisation have the technical ability to
attempt the project (e.g. are its computers and other required equipment
powerful enough)?
3. Operational feasibility: Will the project benefit, or have any positive effects
on, the organisation’s operational capabilities? Will it put the organisation in
a better position to provide other, or better, services outside of the project?
4. Schedule feasibility: Is there enough time in which to complete the project?
5. Market feasibility: Is there an actual need for the service? What is the level
of demand for it? (A market feasibility study may reveal that there is, in fact,
a market oversupply of cloud services.)
6. Regulatory feasibility: Can the project meet legal and regulatory
requirements (e.g. regulations from the Independent Communications
Authority of South Africa, also known as ICASA, which is the South African
electronic communications authority that controls aspects such as broadcast
frequencies and bandwidth controls)?
3.2.3 The components of a feasibility study
The various components of a feasibility study are listed in section 2.5.3 of your
textbook. The following figure provides a quick overview of these components.
Note that the executive summary is usually the final component that is
completed, once all of the other components have been added.

26
Figure 3.1: Components of the feasibility study
3.2.4 Conducting a feasibility study
There are various steps that should be followed when creating a feasibility study.
Figure 2.4 in your textbook outlines seven steps and the sequence in which they
should be performed. The first step is to conduct a preliminary analysis of the
project (e.g. its size), and the last step involves deciding whether or not to go
ahead with the project. Can you recall the other steps in this process, as well as
what each step entails? Read through section 2.5.4 of your textbook to review
each step in detail.
Activity 3A
Complete questions (i) and (iii) in Exercise 2B in section 2.5.4 of your textbook.

27
Example: Feasibility study
Elite Stationery has experienced a lot of growth recently and, as such, wants to
enlarge its offices and redesign the space. The company wants to follow proper
project management principles, as well as conduct an operational feasibility
study for redesigning the workspace environment. This study is based on the
following six parts:
1. Process: The company gathers input and analysis from everyone that will
be affected by the renovations.
2. Evaluation: Inputs from the process, such as how the redesign will benefit
the company, are evaluated.
3. Implementation: The company identifies resources that will be used during
the redesign. It also ascertains how the construction activities will interfere
with employees while they are working.
4. Resistance: The company considers the areas of the organisation, as well
as the individuals, that will be most resistant to the change. This stage
involves the development of a change resistance plan.
5. Strategies: The company considers how it will review whether the redesign
process has been carried out and implemented effectively.
6. Adapt and review: The operational feasibility study will provide an indication
of how much time the company needs in order to adapt to the new redesign,
as well as how the review of the process will be carried out and monitored.
Indicators may include how many hours of work were lost due to
interruptions caused by construction work in the space.
Source: EDGE Education (Pty) Ltd (2021) adapted from BrightHub Project
Management (2010)
Activity 3B
https://www.youtube.com/watch?v=mH8zMj2qw5o
Required:
(i) In your own words, briefly discuss why it is important to conduct a feasibility
study for a project.
(ii) Explain the necessity of having an opening-day balance sheet.

28
3.3 The project proposal
3.3.1 The purpose of a proposal
A project proposal is used to establish a good working relationship with service

providers, such as suppliers and contractors. The format of a project proposal is
discussed in greater detail in section 2.6 of your textbook. Note that a project
proposal is different to a business proposal, in that it is not legally binding.
Writing a proposal has a number of benefits, such as the following:
• It can further demonstrate a project’s feasibility.

• It can provide clarity about expectations.
• It can create a framework for a project.
• It can create more opportunity for funding to be obtained.
• It can increase the chances of success in the future.
• It can create a method or template through which success can be achieved.
Can you unpack each of these benefits in more detail? Are you aware of the
different types of project proposals that are available? Review the introduction
to section 2.6 in your textbook, as well as section 2.6.1, for more details.
3.3.2 The components of a proposal
The format of a project proposal can vary across projects. Section 2.6.2 in your
textbook explains one such format, and it discusses the nine parts of the
document, which are as follows:
1. The project title (which appears on the cover page)

2. The project overview (which is similar to the executive summary in the
feasibility study)
3. The problem statement and background information
4. The project detail (the areas that need detailed descriptions, such as goals
and objectives, clientele, methods, staff and administration)
5. The available resources
6. The resources required (including personnel, facilities, equipment for
communication or general supplies, and budget)
7. The evaluation plan
8. The formative and summative evaluation
9. The appendices (including the dissemination plan, letters of support,
cooperating agency descriptions and evaluation instruments, such as
questionnaires and surveys)
What needs to be included in each element? What is included in each of the four
subsections of project details and required resources respectively?

29
Review section 2.6.2 in your textbook if you are unsure of the answers to these
questions.
3.3.3 Guidelines for creating a proposal
Section 2.6.3 in your textbook sets out the guidelines or principles regarding how
to create a proposal. For example, a project proposal is created only for the
parties that have committed to the project, and not for those who are simply
interested in the project. A project proposal is also a valuable tool in negotiations
with investors. Lastly, a proposal should not go into too much detail or provide
solutions to specific problems, as other parties may reject the proposal, and then
go on to use the ideas suggested in the proposal.
Example: Problem statement
The following is an example of a problem statement in a project proposal that

has been created by a university in order to acquire a new server to run research
software.
Z-Soft is used by the zoology department at the university in order to support

its research and teaching activities. The software is used by researchers to track,
record and analyse data on various facets of rodent life cycles. For example,
through the use of this software, it was found that rodents existing on an
extremely high sodium diet produce a significantly lower number of offspring.
All students in the zoology department are taught how to use the software, and
many of their assignments are required to be completed using Z-Soft. The server
on which Z-Soft runs has been unsupported by the manufacturer since 2015.
Support is currently being received through a contract with Z-Soft Authorities,
Inc., which expires at the end of the following calendar year. The department
has been warned by Z-Soft that there will be a significant increase in the support
fees under any new contract.
As such, it is suggested that a new server is purchased in order for this software
to be run, as opposed to continuing to pay support fees for an outdated server.
Source: EDGE Education (Pty) Ltd (2021); adapted from Casual.pm (n.d.)
Activity 3C
Complete questions (i) and (ii) in Exercise 2C in section 2.6.3 of your textbook.

30
Case study:
textbook.
Summary
In this topic, we looked at two crucial documents that a project manager will
come across, namely the feasibility study and project proposal. The feasibility
study covers a range of issues that need to be managed in order to reason that
the project is indeed viable and worth the organisation’s resources. The project
proposal, on the other hand, is used to describe the project to stakeholders and
investors. You should now be familiar with both of these documents.
Each of the following are items that may appear in the appendices of the
proposal document, except:
a. Cooperating agency descriptions

b. The timeline
c. The problem statement
b. The evaluation instruments
a. When a construction company decides that more buildings should be

built than proposed previously, it will compose a renewal proposal.
b. The opening-day balance sheet must be included in the project
overview.
c. A formative assessment can contain issues such as recurring problems
regarding build quality.

31
5. Match the following concepts in Column A with their correct descriptions
in Column B.
Column A Column B
a. Evaluation plan 1. Motivates for an existing project to continue
b. Dissemination 2. Outlines success metrics or criteria
plan
c. Continuation 3. Outlines planned communications with
project proposal audiences
5. The management of Smith and Co. has commissioned a market research

report. Smith and Co. is a relatively small company, and it does not have
the know-how or expertise to conduct market research. The company
has recently converted its operations from canning fruits to bottling
liquids and beverages, and it is seeking new customers. The company is
considering launching its own drinking yoghurt product, but it is unsure
whom exactly to pitch this product to.
Required:
Advise the company of the considerations and what needs to be included

when compiling a market research report.
6. Unpack the requirements and functions of a project overview as a

component of a project proposal.

32
Topic 4
Project stakeholders and scope
Prescribed reading
● Kuhn et al. (2020): Chapter 3
4.1 Introduction
• explain the role and importance of project stakeholders;

• identify potential stakeholders in a project and the key characteristics of
each;
• create a project charter;
• define a project’s scope and highlight its purpose;
• compose a work breakdown structure (WBS);
• discuss important considerations for composing a project team;
• explain the process of reviewing the project initiation phase; and
This topic covers a lot of ground in terms of content. We start by looking at

stakeholders, such as who they are and who they should be. When selecting
stakeholders, models can be used during the decision-making process. A project
charter is an important document that is created early on in the project life cycle.
We will discuss its components, as well as guidelines on how to create it. We will
then look at the work breakdown structure, discussing its components, the value
of the structure and guidelines on how to compose it. Next, we will explore
project teams and the methods that are used to select them. Finally, we will look
at the review that takes place at the end of the initial phase of the project, known
as the initiation phase review, and what it entails.

34
• Stakeholders
• The project charter
• The project scope
• The work breakdown structure
• The project team
4.2 Project Stakeholders
4.2.1 Project stakeholders
When undertaking a project, it is important to identify who the stakeholders are.

Those who are involved with the project directly are known as internal
stakeholders, and they include the project manager, project sponsors,
employees and the organisation, among others. Other stakeholders typically
include people or organisations that seem far removed from the project;
however, they also play an important role. These are known as external
stakeholders, and they may include members of the community who are affected
by the project, small businesses, outsourced contractors and the environment.
Foodsecure, a fictitious organisation, aims to establish community gardens, so

that communities can produce food locally. It aims to plant foods that are in high
demand, and that are affordable and easy to access, so that there are no
transport or warehousing costs involved. In one of Foodsecure’s projects, the
project manager, together with the municipality, had allocated land where the
gardens would be located. However, the project manager did not take into
account that another group of people had already planned to construct informal
housing on the land. The group was outraged when they heard that they would
no longer be able to build houses there. As a result, Foodsecure appointed a new
project manager, Zinzi, to rescue the project. Zinzi’s first step was to halt any
activities by Foodsecure on the land. She then gathered the individuals who
wanted to construct houses on the land and prominent individuals in the
community, and together, they came up with a solution. In the end, Foodsecure
suggested that in exchange for some of the land, it would offer employment in
the form of managing the gardens. As the benefits of the project became clearer,
the community, including those who wanted to build houses, agreed on the plan.
Can you identify the internal and external stakeholders in Foodsecure’s project?
This scenario illustrates the modern project management approach, which is
discussed in section 3.4 of your textbook, along with two other approaches to
identifying stakeholders. The modern project management approach is
characterised mainly by taking into account those who are indirectly affected by
the project .

35
4.2.2 Stakeholder analysis
In identifying the stakeholders in the project, Zinzi could have also used the
power-interest grid, as illustrated in Figure 3.2 of your textbook. The power-
interest grid is a tool that recommends strategies for engaging the different
categories of stakeholders in relation to the degree of power they hold and the
level of interest they have. Can you remember which stakeholders are assigned
to quadrants A, B, C and D?
The most important stakeholders are those in quadrant B, namely the high power
/ high interest stakeholders. They hold a lot of power in terms of making changes
to the project. They also have a high level of interest in the project, as they are
most exposed to its success or failure. In terms of the Foodsecure scenario, how
would you categorise the stakeholders?
Another tool is the salience model, as depicted in Figure 3.3 of your textbook.
This model consists of a Venn diagram, which is used to categorise stakeholders
along three specific characteristics, namely power, legitimacy and urgency. Can
you identify how these three characteristics overlap in order to produce four more
elements?
The salience model is a visual overview of the position of stakeholders in the

context of a project, and it gives an indication of how to manage them. For
example, stakeholders in the core segment (where all of the circles intersect) are
critical to the project, as they have high levels of legitimacy, power and urgency.
Legitimacy means that the stakeholders are important enough to make requests
for changes to the project. Urgency refers to how quick stakeholders’ requests
should be responded to. The more legitimate and powerful the stakeholders, the
more quickly their requests should be attended to.
4.2.3 Stakeholder documentation
Information that is gathered about stakeholders is documented in a stakeholder

register, an example of which is provided in Table 3.2 of your textbook. This is a
precursor to the stakeholder engagement plan, which is dealt with later in the
textbook. The stakeholder register is also included in the project charter, which
we will discuss next.
Case study:
Refer to the ‘Procurement monitoring and control’ case study in Chapter 12,
section 12.2.3 of your textbook. You should also complete Exercise 12C. Once
complete, compare your answers to the solutions provided in the back of the
textbook.

36
Example: Project stakeholders
A construction company’s project manager needs to analyse project

stakeholders. The following are examples of the stakeholders and their
characteristics, as used by the salience model of project stakeholder analysis:
• Investor: A bank has high power, as it controls capital.

• Customer: Property developers’ urgency is a priority, as they want to realise
their investments.
• Legitimacy: A supplier of raw materials for construction is an important
stakeholder that should be consulted.
Activity 4A
(i) Complete the following stakeholder analysis matrix by calculating the total
stakeholder value, and assign the stakeholder priority using the following
score ranges:
• Key priority: 13–15 points

• Secondary priority: 9–12 points
• Other priority: 1–8 points
Table 4.1: Stakeholder analysis matrix
Stakeholder Legitimacy Interest Urgency Total Priority

Project team 3 4 4
Contractor 2 4 1
Customer 5 5 4
Sponsor 6 3 1
Table 4.1: Stakeholder analysis matrix
(ii) Imagine that a stakeholder has the following scores in legitimacy, interest
and urgency respectively: 2, 1, 1. Indicate the category in the salience
model that the stakeholder will fall under. Substantiate your answer.

37
4.3 The project charter and project scope
4.3.1 The project charter
The project charter plays a vital role in project management, as it enables a

project manager to start deploying project resources. The project charter must
be approved by all parties involved in the project, which typically includes a
sponsor, project manager and top management, who must sign off on the
resources before they are used.
A charter has various components, and it varies across industries. However,

there are items that should appear in any charter, ranging from the project name
to authorisation – each of which has a unique purpose. Section 3.5.2 in your
textbook discusses a more comprehensive, but not exhaustive, list of
components.
4.3.2 Guidelines for creating a charter
An important consideration for the author of the charter is the level of detail that
is required in the document. Too little detail may create an impression of
incompleteness, while too much detail may suggest to the reader that the project
is much larger or more expensive than it actually is. Section 3.5.3 in your
textbook offers practical instructions for writing a proper charter, including
consulting those in the physical vicinity in which a project is being run. This is
helpful for situations such as the Foodsecure scenario described previously.
Activity 4B
Complete questions (i) and (ii) in Exercise 3B in section 3.5.3 of your textbook.
4.3.3 Planning scope management
In simple terms, scope management refers to the size of a project. The definition
of size is quite broad, as it may include the amount of work that goes into the
project, as well as the time and cost of the project. The triple constraint theory
(illustrated in Figure 3.5 in your textbook) indicates the relation and effect that
time, cost and resources have on the quality of a final product. These three
variables are linked – i.e. an increase or decrease in one variable affects the
other two variables.

38
Here, the goal is to keep the variables in balance, if and when the scope of the
project needs to be adjusted. For example, less time may result in higher costs
and lower quality.
4.3.4 Defining the scope
A project’s scope provides the project with boundaries, and it prevents the
project from continuing needlessly, due to there not being a clear description of
what the completed project looks like. The project scope provides a project with
a framework for reaching its goals, and it ensures that the project does not carry
out additional activities that are beyond the original scope definition.
Notes
The following video explains the purpose and structure of a project scope:
https://www.youtube.com/watch?v=NXw0bvvYWYo
You can learn more about project scope from the following article:
https://www.projectmanager.com/training/write-scope-work
An important consideration for scope is the triple constraint theory, as shown in

Figure 3.5 of your textbook. Can you see how this figure relates to the following
example?
Example: Project constraints
Bheki wants to set up an e-commerce website for his business. He has a budget
of R 750 000 and a timeline of nine months. Which constraints can we identify?
Let’s begin by considering information that we have, as follows:
• Project scope: E-commerce website

• Time: Nine months
• Cost: R 750 000
Initially, Bheki thought that he would be able to supply content for the website
from his team, including product descriptions that make use of search engine
optimisation (SEO). However, he has recently discovered that his team does not
have time to produce the content. Therefore, he decides to look into outsourcing
the job to Mandy’s team, which is responsible for handling the project.
With the triple constraints in mind, when Mandy gets this request from Bheki,
she realises that she cannot increase the project scope (i.e. create more content
than was originally planned) without factoring in the impacts and the effects on
time and cost.

39
Naturally, Bheki would prefer to change the scope without the time or cost of the
project being altered. However, as a competent project manager, Mandy
understands the dynamics between scope, time and cost, and she is well aware
that trade-offs between the three constraints are inevitable. In order to manage
the project successfully, Mandy must ensure that Bheki, as the project sponsor
and an important stakeholder, understands this dynamic, too.
Source: EDGE Education (Pty) Ltd (2021); adapted from Aston (2019)
4.4 The Work Breakdown Structure (WBS) and project teams
4.4.1 The WBS
The WBS is a tool that is used to indicate how a project will be organised in terms
of the work that must be carried out. Its aim is to identify tasks and break them
down into smaller units of work. This process is repeated up to a certain point,
which depends on the project. There are three models, or charts, that are
available to project managers when presenting the WBS. These include outlines,
organisational charts and concept maps.
An outline is a basic diagram that is suited to smaller projects. It acts as a basic

framework, and it works well if tasks under each work package are logical and
straightforward. It is also the quickest method to use and is a good starting point.
Figure 3.6 in your textbook provides an example of an outline.
In an organisational chart, which is hierarchical in structure, tasks are broken

down into levels. This model is suited to larger projects and can be used to show
project sponsors an overview of the project. Figure 3.7 in your textbook provides
a simplified example of an organisational chart.
A concept map illustrates relationships between tasks more effectively than an

organisational chart can. This characteristic is useful when the agile project
management methodology is used. Compare Figure 3.7 to Figure 3.8 in your
textbook, noting how Figure 3.8 has been adapted and how tasks have been
rearranged. A concept map is useful in projects where tasks can be carried out
concurrently – i.e. where one task does not have to be completed only once the
previous task has ended in order for the project to move ahead.
4.4.2 The purpose and value of a WBS
A WBS is valuable for various reasons. For one, it makes it easier to understand
the work that is required in order to achieve the scope. It also makes it easier to
estimate time (how long the project will take) and budget (how much the project
will cost).

40
Task relationships can be illustrated effectively using a WBS; for example, it can
indicate predecessor tasks (tasks that must be completed before other tasks can
begin). Task schedules depend on the information in the WBS, which allows time
to be allocated to activities or stages. The number of workers required, as well
as the skills required, can also be presented using the WBS. However, a project
manager should not put too much detail into the WBS, as it may detract from
viewing the project as a whole.
4.4.3 Components of a WBS
A typical WBS is composed of three components, namely work packages, level

indicators and links that indicate the relationship between tasks. Refer to section
3.7.2 in your textbook for a broad discussion on these components.
A work package is any task or piece of work that must be carried out. Basic tasks
(i.e. tasks that cannot be subdivided into further tasks) reside in what is called
the critical path. The tasks in the critical path must be carried out in order for a
project to be deemed complete.
Level indicators refer to a numbering system (e.g. 1, 1.1, 1.1.1, and so on),
where the numbers indicate the levels at which tasks reside. For examples of
level indicators, have a look at Figure 3.6 in your textbook. The term ‘level of
decomposition’ refers to the position of a particular task relevant to higher-level
tasks. Note that lower-level tasks must be completed first.
Links are used in order to show relationships between tasks in the organisational
structure diagram. If you are unsure of what such a diagram looks like, you can
refer back to Figure 3.7 in your textbook. Essentially, it is a vertical arrangement,
with the links showing task dependence. These links are usually labelled for easy
reference.
4.4.4 Guidelines for creating a WBS
It is crucial to remember that when creating a WBS, you should not provide too
much detail. A project manager must know when to stop breaking down a work
package or adding levels, as too much detail will distract from viewing the project
from a wider perspective. In order to ensure that there is not too much detail in
the WBS, a project manager should consider the following seven guidelines:
1. The organisational unit must be the smallest piece of work in the WBS, and
it should not be subdivided.
2. The deliverable basis should be the lowest level of detail required in a task
that is acceptable for delivery to the customer.
3. The scope of work must meet specific customer requirements, such as
particular features.
4. The schedule estimation should use time as an indicator in terms of when
the breakdown of a work package should cease.

41
5. The cost estimation should use cost as an indicator of when the breakdown
should stop. Breakdown should stop when the cost can be estimated
sufficiently and reliably.
6. Risk management should be carried out when a work package can be broken
down in a way that resolves a specific risk. A work package can be broken
down into further levels in order to ensure that risks (e.g. poor product
quality) are dealt with as specific tasks.
7. Organisational guidelines are rules (e.g. related to quality or cost standards)
that are set by the organisation itself, which the work package must adhere
to. These rules require tests, and the tests must be included in the WBS.
Can you outline these in more detail? If you need to refresh your memory, read
over the discussion in section 3.7.3 of your textbook.
Activity 4C
https://www.youtube.com/watch?v=akO2Lf1fHmM
Required:
(i) Identify why the following tasks listed in a WBS for publishing a magazine
are problematic.
Figure 4.1: Tasks in a WBS for publishing a magazine
(ii) Suggest a better way to present the tasks listed in the WBS in Figure 4.1.
(iii) State whether the following figure represents a work breakdown structure
or a product breakdown structure. Substantiate your answer.

42
Figure 4.2: A breakdown structure
Source: EDGE Education (Pty) Ltd, (2021)
4.4.5 Composing the project team
Research has shown that in order for a team to be highly effective, the team
members should have specific qualities or traits. Section 3.8 in your textbook
lists 11 traits that are desirable in a team member, and it mentions that technical
and interpersonal skills are essential. When not enough individuals with these
traits can be found, a project manager should consider outsourcing people (hiring
people from outside of the organisation) with those traits.
When designing roles for team members, a project manager can use Morgeson
and Humphrey’s integrative framework of work design. This framework is
discussed in section 3.8 of your textbook. You should also study the diagram of
the framework in Figure 3.9 in your textbook.
Example: Morgeson and Humphrey’s framework
As we have seen, Morgeson and Humphrey’s framework consists of task, social

and contextual spheres. The following is a breakdown of the variables in each
sphere used to design work and describe roles.

43
Task characteristics
• Work scheduling autonomy

• Decision-making autonomy
• Work methods autonomy
• Task variety
• Significance
• Task identity
• Feedback from job
Social characteristics
• Social support
• Initiated interdependence
• Received interdependence
• Interaction outside of the organisation
• Feedback from others
Work context
• Ergonomics
• Physical demands
• Work conditions
• Equipment use
Source: EDGE Education (Pty) Ltd (2021); adapted from Morgeson and
Humphrey (2006)
Activity 4D
Complete questions (ii) and (iii) in Exercise 3C in section 3.7.3 of your textbook.
4.5 Initiation phase review
Once the preliminary elements of a project, such the project charter, WBS and
other documents, are established, it is important to review this first stage.
Section 3.9 of your textbook addresses the review of the initiation phase of a
project.

44
4.5.1 Overview of objectives
Section 3.9 of your textbook starts by discussing the objectives that should have
been met by the end of the project initiation phase. These objectives include
assigning a project manager, establishing a project charter and creating a
statement of constraints and assumptions. This section deals specifically with
project constraints and assumptions that must be identified before the project
planning enters the formal stage.
4.5.2 Constraints
Apart from time, money and resources, what other types of constraints can you
think of that can affect a project? Constraints, whether they are known or
unknown, can have an impact on various aspects. For example, it can affect
costs, in that a constraint may cause a project to exceed its deadline and,
therefore, go over-budget. As such, it is best to list in the project charter any
potential constraints that may influence the project, so as to show that you, the
project manager, are aware of them.
4.5.3 Assumptions
It is natural for us to make certain assumptions about the future. For example,
we can be certain that the sun will rise every morning. Project managers also
make assumptions about what will happen in the future, such as whether the
stock market will go up or down. For instance, when share prices are expected
to rise (known as a bull market), there may be more organisations seeking to
invest their money in projects. However, when the stock market is experiencing
a decline (known as a bear market), finding investors may become more
challenging. As such, the project sponsor and management will make
assumptions when planning a project, taking into account factors outside of the
organisation. Decisions are made based on these assumptions, and they should
be made by the time the initiation phase is complete.
Example: The phase review form
At the end of the project initiation phase, a phase review form should be
completed. Although this form can be customised to a particular project, there
are fields that should typically appear in the form, such as the following.
Project details
• Project name:
• Project manager:
• Project sponsor:
• Report prepared by:

45
• Report preparation date:
Overall status
• Overall status:
• Project schedule: (refer to the project plan)
• Project expenses: (refer to the financial plan)
• Project deliverables: (refer to the quality plan)
• Project risks: (refer to the risk register)
Review details
• Schedule: Was the phase completed to schedule? [Yes/No]

• Expenses: Was the phase completed within budgeted cost? [Yes/No]
• Deliverables:
▪ Business case: Approved? [Yes/No]

▪ Feasibility study: Approved? [Yes/No]
▪ Terms of reference: Approved? [Yes/No]
• Risks: Are there any outstanding project risks? [Yes/No]

• Issues: Are there any outstanding project issues? [Yes/No]
• Changes: Are there any outstanding project changes? [Yes/No]
Approval details
Signature:
Date:
Source: EDGE Education (Pty) Ltd (2021); adapted from Google Docs (n.d.)
Case study:
Refer to the ‘Procurement monitoring and control’ case study in Chapter 12,
section 12.2.2 of your textbook. You should also complete Exercise 12B. Once
complete, compare your answers to the solutions provided in the back of the
textbook.
Case study:
textbook.

46
Summary
In this topic, we looked at stakeholders, the project charter, the project scope,
the work breakdown structure, the project team and the review that takes place
at the end of the initial project phase.
We discussed the nature of stakeholders, as well as how to identify and analyse

them using various tools and key forms of documentation. We then looked at the
project charter, along with its purpose and value. We also unpacked project
scope and the models that are useful for planning and defining the scope, such
as the triple constraint model.
Following on from the scope, we analysed the work breakdown structure, which
is a diagram of how work will be assigned. There are three formats that can be
used when constructing the WBS, namely the outline, organisational chart and
concept map formats.
The subject of teams was addressed next, with a discussion on how they can be
composed. A useful model that can be used to visualise the desired structure of
a project team is the integrative framework of work design, as proposed by
Morgeson and Humphrey. The final section of this topic was devoted to a
discussion on the initiation phase review document and its contents.
A project manager can use the power-interest grid to define strategies for:
a. Appointing the best project manager

b. Engaging stakeholders
c. Recruitment
d. Overcoming materials shortages
a. It is a perfectly acceptable practice to hire an employee to join the

project team if someone with the right qualities or skills cannot be found
in the organisation.
b. The simplest WBS format is the organisational chart structure.
c. A concept map is well suited for use in agile project management.
d. Constraints should be listed in the project charter.

47
3. Match the following concepts in Column A with their correct descriptions in
Column B.
Column A Column B
a. Interest 1. A document that is created during the project
initiation phase
b. Salience model 2. What a stakeholder stands to gain or lose through
a project’s outcome
c. Project charter 3. A model for representing the relationship between
resources and quality
d. Triple constraint 4. A tool for stakeholder analysis
4. Explain the concept of scope management and how it is applied in practice.
5. Unpack the triple constraint model, using an example of your own in your
answer.

48
Glossary of terms
Term Description/explanation
Agile A method of management that seeks to make
processes more efficient.
Appendices Supporting documents that are included in a project
proposal.
Balanced scorecard A strategic management performance tool that is
used to measure functions within the organisation
and its external outcomes.
Constrained A method for selecting projects that are large and
optimisation complex, and that require mathematical or statistical
calculations regarding the likelihood of outcomes.
Deliverable The end result of a project – whether it be a physical
object, intellectual property or a transition from one
state to another.
Dissemination plan A document that describes how information will be
shared with a wider audience.
Organisational matrix A flat organisational structure that represents not
only vertical (top-to-bottom) reporting lines, but
also horizontal (left-to-right) reporting lines.
Project sponsor A person, group of people or organisation that
finances or supports a project by providing the
necessary resources.
Ratification The formal signing of the terms of a contract. A
project charter is often ratified before project work
can begin.
Risk A situation in which the outcome is not predictable
or controllable and is often due to chance.
Scope The boundaries of what can and should be done
within a project in order to ensure its completion,
as well as to produce a deliverable.
Scrum A project management methodology that is useful
for smaller teams, where work is carried out in
sprints.
Solicited Something that is requested, usually in a formal
manner, by someone in authority.
Sprint Time periods of specific lengths that are set aside
for tasks pertaining to a specific aspect of a project.

49
Stakeholder Any person or organisation that is invested in the
completion of a project.
Technical baseline Ground rules or assumptions regarding the
technical aspects of a project, such as design
specifications, timelines, phases and schedules.
Venn diagram A diagram that uses circles to represent overlapping
characteristics that are common to the featured
elements.
Work breakdown A depiction of the project work within a structured
structure (WBS) diagram.

50
References
Altvater, A. (2017), ‘What is Agile Methodology? How It Works, Best Practices,

Tools’. Stackify [website] <https://stackify.com/agile-methodology> accessed 7
July 2021.
AssistKD (2018), ‘What is Internal Rate of Return (IRR)?’ [video] YouTube

[website] <https://www.youtube.com/watch?v=b3sZIjkRpak> accessed 29 July
2021.
Aston, B. (2019), ‘A Project Management Triple Constraint Example & Guide’.

The Digital Project Manager [website]
<https://thedigitalprojectmanager.com/triple-constraint> accessed 7 July 2021.
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Image credits
EDGE Education (Pty) Ltd
Flaticon
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PROJECT MANAGEMENT I

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©STADIO Assignment – 2024 Semester 1 POM100 Project Management I

Question 2 (25 marks)

©STADIO Assignment – 2024 Semester 1 POM100 Project Management I

When the Manager is the Problem

©STADIO Assignment – 2024 Semester 1 POM100 Project Management I

Assignment Total: 75 marks

©STADIO Assignment – 2024 Semester 1 POM100 Project Management I

Heading Page number

TOPIC 1 PROJECT MANAGEMENT WITHIN ORGANISATIONS 1

1.2.2 Risk and cost profiles 3

1.2.3 The project manager 4

1.3 The project management life cycle 5

1.3.2 The planning phase 6

1.3.3 The execution phase 6

1.3.4 The monitoring and control phase 6

1.3.5 The closure phase 7

1.4 Project management in organisations 8

1.4.2 The project management office (PMO) 8

© STADIO (Pty) Ltd Project Management I POM100

2.2.2 Strategic direction alignment with projects 17

2.2.3 Strategic objectives and portfolios 17

2.2.4 Project portfolio management (PPM) 19

2.3 Project selection 19

2.3.2 Project selection methods: Benefit measurement and constrained

3.2.2 Types of feasibility 25

3.2.3 The components of a feasibility study 26

3.2.4 Conducting a feasibility study 27

3.3 The project proposal 29

3.3.2 The components of a proposal 29

3.3.3 Guidelines for creating a proposal 30