Introduction Project Planning Management and Control

Introduction to Project Planning Management and Control

Contents

Page No

1. What is project management? 2

1.1 Definitions
1.2 What is a project?
1.3 Why is project management so difficult?
1.4 Project management is not ...

2. A brief history of project management 6

3. Why project manage? 10

3.1 Rate of Change of Technology
3.2 Competitive need for speed
3.3 It Works
3.4 There is often no other way to achieve our objectives

4. Introduction to the Module 14

References 15

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1. What is Project Management?

1.1 Definitions

There are many definitions of project management, most of them focusing on the
same major issues. The following definition, taken from the British Standards
Institute, is typical and identifies these issues:-

“A Project is a unique set of coordinated activities, with definite starting and

finishing points undertaken by an individual or organisation to meet specific
objectives within defined schedule, cost and performance parameters.”

“Project Management is the planning monitoring and control of all aspects of a

project and the motivation of those involved in it to achieve the project
objectives on time and to the specified cost, quality and performance”

British Standards Institute [1]

On a less formal level Geoff Reiss [2] defines project management as

“...the management of change”

Whilst he suggests that this is an oversimplified definition, it does introduce three

important issues
 all projects have ‘change’ associated with them in one way or another
 project management tools and techniques are often used to implement change and
 the human factors that underpin change management also underpin project
management.

It is important to realise at the outset that the human factors of obtaining commitment,
managing conflict, influencing people, negotiating for resources and maintaining
motivation are as important in effective project management as the ability to use
specific tools and techniques.

Figure 1 shows the skills necessary to be an above average project manager. (289
project managers identified the key skills, personal characteristics and traits they felt
most important in an excellent project manager) [3]. It is interesting to note that most
of these issues are soft-skills rather than the ability to use specific tools and
techniques.

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1. Communication Skills (84%) 4. Leadership Skills (68%)

 Listening  Sets example
 Persuading  Energetic
 Vision (big picture)
 Delegates
 Positive
2. Organisational Skills (75%) 5. Coping Skills (59%)
 Planning  Flexibility
 Goal-setting  Creativity
 Analysing  Patience
 Persistence
2. Team Building Skills (72%) 6. Technological Skills (46%)
 Empathy  Experience
 Motivation  Project Knowledge
 Esprit de Corps

Figure 1: Project Management Skills

Source: What it takes to be a good project manager Barry Z. Posner
Quoted in Meredith and Mantel: Project Management a Managerial Approach [3]

1.2 What is a project?

A good place to begin our look at project management is to ask ourselves what makes
a "project" different from any other management activity. What are the things which
characterize a project?

One-Off
A Specific Objective
Interdependent tasks
Defined Life cycle
Change and Conflict

One-off

A project is generally to achieve a unique objective. Examples such as the channel

tunnel and the Apollo moon landing program are obvious; others, such as the
construction of a nuclear submarine or a block of flats are less clear. We have built
nuclear submarines or blocks of flats before. However even repeat projects tend to
have some unique content. The design has been improved, the customer requirements
have changed, and the suppliers are different. Project management specialises in the
control of activities that have never been performed quite like this before. As
similarities to previous projects increase the problem becomes easier until project
management is no longer required and the function becomes part of the day to day
management of the business.

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A Specific Objective

A project generally has one overriding goal whose achievement can be broken down
into sub tasks. These tasks generally require careful coordination in terms of their
output, sequence, timing and cost. As the project specification is defined, likely costs
and time-scales will be developed. The three objectives of any project address
specification, time-scale and cost. These must fall within realistic limits for the
project to be feasible.

Interdependent tasks

The competitive need for speed means that we must perform as many activities as
possible in parallel in-order to reduce the total duration of the project. The same
principle applies whether we are launching a new product, commissioning new
facilities or developing a new information system. The sooner we can implement our
solution the sooner we can see the benefits and the sooner we can achieve competitive
advantage. In the past we had the opportunity for each function to complete,
document and review their contribution to the project before the next function started.
Now we need to work in interdisciplinary teams where each function operates in
parallel. Tasks are more technically complex than they have ever been and need to be
completed in a fraction of the time. As a result interdependencies between traditional
functional disciplines have increase exponentially. Each interdependence introduces
the possibility of resource conflicts and arguments over priorities with other tasks on
the same project and with similar tasks on other projects. Project management is
about the identification and management of these interdependencies.

Defined Life cycle

A project has a beginning, a middle and an end and tends to follow a defined life-
cycle from conception, through planning and execution to termination. A project by
its very nature is temporary and is to achieve a specific objective. Once this objective
has been achieved the project ceases to exist.

Effort
Cost

Time
Concept Planning Execution Termination

Figure 2: An Effort or Cost profile of a typical project over its life-cycle

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Change and Conflict

Due to the nature of "projects" conflicts can frequently arise. These can be caused by
company politics, competing for scarce resource and the nature of change
management. The reason that project management is so difficult is that there are often
powerful forces which work against the introduction of change. These forces can be
seen as being of three types: personal; organisational, environmental.

Personal: People who work in a steady state environment like it that way. The
prospect of change introduces the fear of the unknown which might threaten their
environment or their position; quite reasonably they are inclined to resist such change.

Organisational: The organisational structure which is appropriate to management of

the steady state is unlikely to be appropriate to the management of change; therefore
to introduce change will probably necessitate the establishment of a task force whose
function is to co-ordinate the different strands of the existing structure. In doing this it
cuts across the established lines of authority and conflicts with them.

Environmental: The environment of the steady-state has objectives which, when seen
in the short-term, are more important than introducing change. Any change may be
compromised in its extent and in its timing by the perceived importance of not
impacting on these short-term objectives. Further, the ways of thinking, the "ethos",
"culture" or "values" in steady-state areas, are generally inappropriate to the approach
which most readily adapts and accepts change.

1.3 Project Management is not...:

There are a number of common and dangerous misconceptions about project

management that need dealing with at the outset. Many people believe that a project
manager is a person who can operate a project management software package.

“ Give him a software package. What more does he need?” is a fairly common view.

In fact software packages can often detract from effective project management. They
give the user an opportunity to focus on detail whilst missing the broad picture, they
make no decisions for you and only if used effectively do they reduce the
administrative overhead of presenting, planning and controlling. Whilst they are
essential for projects with many interdependent activities we need to keep their
usefulness in context.

Project management is not just a set of tools and techniques. “Read this text book
and you will be a good project manager.” Effective project management is a
combination of soft and hard skills. Good analytical skills are as important as good
communication, conflict management or resource negotiation.

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We should not lose the message of figure 1: That good project management is an
effective combination of the soft man management skills, as well as the harder
analytical tools.

“ He’s changed his mind. He wants to be cremated “

Figure 3. The management of change is an important aspect of effective project

management.

2.0 A brief history of project management

History

Since the beginning of time man has been capable of completing amazing projects; the
pyramids, the Great Wall of China and Stonehenge are excellent examples. Allegedly
project management was the key to each of these successes. (As figure 3 illustrates
many of the problems of project management are unchanged today).

More recently project management started with the use of isolated planning tools in
the early part of this century and has developed into a discipline with a coherent set of
tools and techniques and some underpinning philosophies.

Gantt Chart

The earliest tool was the Gantt chart or bar chart. This was first successfully used by
its originator Henry Gantt for the planning and control of the building of cargo ships
during the First World War (1914-1918). He managed to significantly reduce the total
construction time for a vessel.

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Project management developed in the petrochemical industry in the late 1930’s and
evolved as a more rigorous discipline through the 1950’s. It established a strong
following in the defence industry through a number of high profile American military
projects.

PERT Analysis (Program Evaluation and Review Technique)

In the 1950’s the US Navy saw the need for an organised approach for use on major
projects. This began with the Atlas missile program of 1954. In 1955 the special
projects office was established by Admiral Raborn specifically for the management of
the Polaris Missile programme. PERT (Program Evaluation and Review Technique)
was developed specifically for use on this programme by the US Navy, Lockheed, and
Booz Allen and Hamilton. (The basic philosophy was based on a paper by Flagle
published in West Germany in 1956). The final tool involved the estimate of three
possible duration’s for each activity; an optimistic time, a most likely time and a
pessimistic time. These times were combined and used statistically to predict the
likely duration of the overall project. The Polaris project was a great success and this
was attributed rightly or wrongly to PERT. The tool became very popular to the
extent that a speaker at the American Management Institute stated that.

”Anyone not using PERT should not be managing projects at all”

American Institute of Management

(Quoted in Geoff Reiss [2])

In the 1960’s PERT was adopted in Europe where its use was transferred to the
construction industry. Unfortunately it gave many senior managers nightmares. The
software was expensive to use, fragile in the extreme, and took so long to update that
the building was usually finished before the first progress report was available.

The tool was to be used for the management of the Concorde project. In practice
PERT was never used as a real management tool and at the working level bar charts
were generated in a form that was generally understood. The use of PERT was
formally abandoned on the project in 1972 as it proved unworkable and unreliable.

PERT fell from favour and by the early 1970’s was effectively dead. It has only
recently become more popular as risk has become the topic of note in project
management.

CPM (Critical path Method)

In parallel with the development of PERT a similar tool called CPM was developed
in 1957 by Remington Rand Univac for the construction of a petrochemical plant for
Dupont. This technique involved the estimate of two times and two costs for every
task in the project; a fastest possible time or “crash” time and cost and a normal time
and cost. If the time-scales proved too long or the project started to overrun, the
cheapest solution for compressing time could then be calculated.

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Earned Value Analysis

The US Department of Defense (DoD) went on after Polaris to develop a tool called
PERT/COST that incorporated the cost dimension into the time planning tool. This
was even more complex than PERT and was rejected outright by industry as
unworkable. It was however the foundation for the approach called Earned Value
Analysis that effectively combines time and cost monitoring and control in the same
tool. The basic concept is really useful as a monitoring and control system for
projects of over about £1Million. Its use on smaller projects is doubtful as the
monitoring systems needed generally cost more than the benefits.

The tool shows cost and time performance on one graph, which allows management
by exception where there are many projects to manage, and it provides a common
method of communicating progress across multinational or multi-company projects.

The basic tool has been built into a rigorous set of procedures by the US Department
of Defense (DoD). Firstly called C/SCSC; Cost and Schedule Control System Criteria
and more recently CSPEC. Whilst these systems are essential for companies
supplying to the DoD, other organisations are aware of the overhead these systems
impose and are adopting the core tool without many of the surrounding administrative
procedures.

Software Availability

PERT died a death in the early 1970’s because of the unwieldy nature, cost and
unreliability of computer software. With the growth of low cost computing for every
business and every household PC based packages are now widely available and widely
used. Microsoft Project for Windows is now seen as the standard. It is no longer just
an easy-to-use but seriously defective piece of kit which no serious project manager
would touch, as it once was. Successive editions provide heavyweight project
management assistance for both simple and sophisticated users. Competing software
must either offer additional or better functionality for particular users or applications.
Wide availability does not guarantee competence in the use of these packages or an
understanding of project management disciplines. As a result users have very variable
success rates.

Although project management software packages are only a small part of project
management, the rise in their use has raised the profile of project management as a
discipline. It is no longer a specialist discipline but an essential ability for the rounded
engineer.

PC packages can have their limitations. Some facilities are generally sufficient for a
novice user who wants to improve the quality of his bar chart presentation, or network
analysis, but the more advanced functionality can be more difficult to apply.

More sophisticated and higher cost tools such as PRIMAVERA, ARTEMIS, and
OPEN PLAN are available for the user with multiple projects and complex reporting
and monitoring requirements.

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Risk Management

If Project Management received broad recognition in the 1970’s with the foundation
of professional societies in Europe, USA, Australia and Japan, one aspect of project
management has held the limelight since the 1990’s.

Despite the use of project management tools and techniques many projects overrun on
both time and cost. Many project managers have realised that the reasons for failure
were visible at the outset of the project if they had only analysed the potential for
failure and thought about the risks. In many ways a large part of project management
is risk management. Unlike other activities in operations management which are often
repeated over and over again, projects are unique and different and things will rarely
go exactly to plan, good project management should be about knowing the relative
importance of tasks to the overall project and having thought what can be done when
things go wrong.

The advent of project risk management has generally been a healthy thing for project
management. At least it forces the identification of potential risks at the outset of the
project, “insurance” or reduction of risks and the ongoing evaluation of the risk profile
during the project. There are a however a number of strands of risk management that
are unhealthy if followed to excess.

There are those that believe the key to effective risk management lies in sophisticated
software tools. Most of the major software packages now have risk analysis add-ins
based on statistical analysis or Monte Carlo techniques. This is not because these tools
are necessarily appropriate but they were the easiest to implement at the time.

There are those that believe that a risk management methodology is the key. There
are now a number of competing methodologies that seek to guide our identification,
analysis and management of risk. Like all methodologies they can introduce amazing
levels of bureaucracy and drive out innovative thought if used to excess.

The important aspect of risk management is not the software tool that you use or the
framework that you adopt, but the fact that risks are being explicitly defined at the
very start and continuously during the life of the project and that everyone involved in
the project plays their part in dealing with risks.

Team Building

There is no doubt that all the early developments in project management focused on
the scientific use of tools and techniques and excluded the human elements.[4] The
realisation of this omission has lead to a large number of team-based initiatives across
a wide range of different companies and industries. The focus on teams is important
and useful as the team can be a very useful vehicle for managing and implementing
change and achieving buy-in commitment and empowerment. The major concern is
that like most fashions, people will miss the underlying cultural changes, focus on the
techniques, and throw them away when the next fashion comes along. It will be a real
shame if we lose the important human aspects of project management through the
fascination with fashions.

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The Future

Project Management has evolved from the use of individual tools and techniques.
Additional tools have been developed until the set available is fairly comprehensive.
The focus on human issues and underlying culture is as important if not more
important than the use of specific “scientific” tools. The future will be about
improving culture and use of the tools and techniques, not developing new tools. The
current focus is on documenting and developing a coherent project management
“body of knowledge”

3.0 Why Project Manage?

There are a number of reasons why effective project management is becoming more
and more important in today’s ever changing competitive environment.

 Rate of Change of Technology

 Competitive Need for Speed
 It Works
 There is often no other way to achieve our objectives

3.1 Rate of Change of Technology

Technology is changing at an ever-increasing rate. My grandmother used to travel to

school in a horse and cart. In only three generations we have flown for the first time,
broken the sound barrier, and landed men on the moon. Figure 4 shows some of the
developments in the transportation field.

K n ow led ge
1 9 7 0 C on cor d e
M a ch 2
1 9 6 9 M oon L a n d in gs

1 8 0 1 S t ea m T r a in
1 7 8 3 B a lloon F ligh t
1 7 6 9 M ot or ca r
1 9 6 1 M a n n ed S p a ce
F ligh t
1 9 3 9 J et F ligh t
1 9 0 3 W r i g h t B r o s. F l y

1700 1800 1900 2000

T im e

Figure 4: The rate of change of technology in transportation

In the world of biology, the Nobel Prize was awarded in 1962 for the discovery of
DNA. Now we are altering the genetic construction of plants and animals to develop
beneficial characteristics; disease resistant wheat and faster growing salmon.

In computing and electronics development has been relentless, from the first analogue
computers in the 1950’s to the 64 bit processors of today. Robert Beaty, Director of
Technology IBM(UK) in 1993 stated a case in point [5]. In 1968 when he first joined
the organisation he worked on the development of a memory device of 32KByte

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capacity. It represented the state of the art and relied on storing the information in
small ferrite cores, fitting neatly in a cube 2ft x 3ft x 3ft. By 1993 16 Mbytes of
memory fitted on a chip ¼ inch square ( 2009 figure - 4 Gbytes). This represented a
staggering 200-million times improvement in function per unit volume. If the
automotive market had developed at a similar rate, a Rolls Royce would cost less than
£1, would be capable of 2,000 miles per hour and would be able to circle the earth on
a single gallon of petrol. There would of course be one problem. Since electronics
progress has been based on miniaturization, the Rolls Royce would also be less than
one inch long.

As technology advances at an ever increasing rate, projects become more and more
complex with more activities that are inter-related in more complex ways. We now
need more experts in more specialist fields as the technology gets beyond the
experience of the general engineer.

The projects we are working on now require a mix of functional disciplines that have
rarely been required before. For instance:-
 The growth of engine management systems in cars now needs electronic engineers,
software engineers, thermodynamics experts, and control engineers to work closely
together as part of a team to achieve their objectives in the fastest time possible.
 The development of compact disc technology required materials engineers, audio
specialists, mechanical engineers and laser experts to work as an integrated team.
 The growth and use of the Internet means graphic designers, web page artists, IT
specialists and marketing experts need to work together. If we extend this example
to include shopping over the network, then we can include data security experts
and credit card organisations as well.

The list is endless. We can all think of examples where different disciplines need to
cooperate and work as integrated teams because of the development of technology and
the need to do things faster.

Technology is changing at an ever increasing rate, projects are therefore becoming

more complex, and tasks become more interdependent and require new mixes of
skills.

And to compound these pressures we need to do everything at twice the speed. The
need to develop a new product or install a new process to hit an established market
window introduces a second driving force in the use of project management; the
competitive need for speed.

3.2 Competitive Need for Speed

Product development times are getting shorter and shorter as each company seeks to
get its new product to the market before the competition. Figure 5 shows typical cycle
times in World Class Car Companies in 1990. It used to take car companies 10 years
to develop their new products. Now it takes the best western companies 4 years and
the best Japanese companies are fast approaching two years. The pace of competition
is not slowing down.

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Value Provided Representative Cycle Times

Western Japanese
Sales order and 16-26days 6-8 days
distribution
Vehicle manufacturing 14-30days 2-4 days
New Vehicle design and 4-6 years 2.5 - 3 years
introduction
Median age of product 5 years 3 years
offering

.Figure 5:- The New Pace of Competition: World Class Automobile Companies
Source: Stalk and Hout, “Competing against Time” Free Press ,2003 [6]

In the world of consumer electronics the time pressure is as intense. Good examples
of products that have had short lifespan in recent years are home computers and
tablets. New models with new specifications are launched on the market rapidly to be
replaced by newer models. There is a similar story for mobile phones.

McKinsey & Co. have investigated the need for faster lead-times and have quantified
the impact of a delay in product launch on the final profitability of the product. A
launch delay of six months will reduces subsequent profitability by a third

Time late to market (months) 6 5 4 3 2 1

Potential profit loss 33% 25% 18% 12% 7% 3%

Figure 6:- Impact of time delay on profitability, (Source [7])

A second study by the same organisation [8] found that the following features
distinguish winners from losers. The winning companies generally:-
 commercialise more new products and processes than their competitors
 incorporate several times as many technologies in their products
 bring products to markets in less than half the time
 compete in more different product and geographic markets

Stalk and Hout of the Boston Consulting Group [6] have researched a number of
companies that focus on time as a competitive weapon and have defined their ¼ : 2 :
20 rule. Companies that take 25% out of their lead-times see the productivity of their
labour and working capital almost double and as a result they reduce their cost base by
20%.

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All the research suggests that there is a tangible business benefit in launching new
products faster and developing and commissioning new processes faster. These are
typical fields for project management.

The research also suggests that there is appreciable business benefit in making our
day-to-day business operate faster. In some make to contract environments this too
involves project management. More normally the day to day operation of the business
does not involve project management tools and techniques. The question remains as
to how we implement faster business processes. The answer is effective project
management.

3.3 It Works

Actual experience with project management over the last 20 years shows distinct
business benefits.

Davis [9] shows that the majority of organisations using project management achieve
better control and better customer relations. A significant proportion of users also
report shorter development times, lower costs, higher quality and reliability and higher
profit margins. Other reported advantages include a sharper orientation towards
results, better interdepartmental coordination and higher worker morale.

A limited number of firms did suggest that the use of project management had some
disadvantages. They reported that it increases organisational complexity and makes it
more likely that organisational policy will be violated. This is not really surprising
given the degree of autonomy required for the project manager. A limited number of
firms reported higher costs, more management difficulties and lower personnel
utilisation.

Morris and Hough [10] evaluated project management performance on eight major
collaborative or international projects. Whilst their study identifies the failures and
successes they conclude from their research that :-

“Considerable progress has been made over the last 20 or so years in the way
projects are managed and in the tools and techniques used to control them.”

Alan Webb [4] concludes his article on the history of project management with the
statement that:-

“It is the field of complex multifaceted undertakings with tight constraints that the
project management approach can be most effective. Although it contains no
guarantee of success it brings with it the discipline of thought and the assortment of
techniques that are needed to address complex issues and also guidance as to the types
of solution that might be applicable.”

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3.4 There is often no other way to achieve our objectives

It is literally not possible to design and build a major weapons system for example in a
timely and economically acceptable manner except by project organisation. Tough as
it may be, it is all we have and it works.

4.0 Introduction to the module

Typically project management courses address either the techniques side (e.g. Work
breakdown structures, network planning etc.) or the behavioral topics (e.g. leadership
styles, group psychology etc.). This course will mainly deal with the techniques side
of project management, but to avoid the misconception that the techniques themselves
are the sole key to success in project management this is prefaced by three sessions to
establish a brief but secure basis in the behavioral aspects of project management.

In case there is any danger of the course becoming purely theoretical, and recognising
that project management is essentially a practical subject which draws most of its
learning from experience, there are case histories included later within the programme
to illustrate the realities of different sorts of projects.

Running through the course is the project management exercise, your chance to put
into practice some of the techniques you learn.

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5.0 References

1. British Standard BS 6079 : 2010

“Guide to Project Management”, British Standards Institute

2. Project Management Demystified, 3rd Edition Geoff Reiss.

E and FN Spon 2007

3. “What it takes to be a good project manager” Barry Z. Posner

Quoted in Meredith and Mantel : Project Management a Managerial Approach
8th Edition Wiley 2011

4. “Project Management : 40 years young and still looking for a philosophy”.

Alan Webb. Project Manager Today. April and May 1996

5. Robert Beaty, Director of Technology IBM (UK), Royal Academy of

Engineering, Engineering Manufacturing Forum Lecture, May 1993, Warwick
University Arts Centre.

6. “Competing against Time”, Stalk G., and Hout T.M., Free Press, 2nd Edition 2003

7. “Teamwork Plus Technology Cuts Development Time”, Perry T.S.,

IEEE Spectrum, October 1990, p61-67.

8. “Commercialise Technology: What the Best Companies Do”, Nevens, T.M.

Harvard Business Review, May-June 1990.

9. “CPM use in Top 400 Construction Firms”, Davis,E.W.

Journal of the Construction Division, American Society of Civil Engineers, 1974.

10. “The Anatomy of Major Projects”; Morris, P.W.G., and Hough, G,H
John Wiley and Sons 1987

11. “Making It Happen : Reflections on Leadership ”, John Harvey Jones

Collins 2003

12. “Management Teams Why They Succeed or Fail”, Dr R Meredith Belbin .

Butterworth-Heinemann Ltd 3rd Edition 2010.

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