Agenda. Projektledning. Why the emphasis on project management? How are we doing so far? What is a project? Gunnar Wettergren

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1 Agenda What is a project? Why is it important? Life cycle Roles/Management People Planning & Budgets Resources and Scheduling Risks Projektledning Gunnar Wettergren Why the emphasis on project management? Many tasks and ideas do not fit into the organization We need to be able to assign responsibility and authority to achieve organizational goals How are we doing so far? In 1998, the Financial Review reported that only 13% of companies are very happy with their return on technology investments In 53 out of 59 industries, increased IT spending did not result in a corresponding jump in productivity (McKinsey, 2002) ~ 50% of IT projects fail (Standish Group, 2002) 60% of the surveyed companies in 2002 had little or no formal training in project management (Organizational Project Management Baseline Study, Interthink Consulting, September 2002)

2 Characteristics of a project PM vs. general management Unique Has a specific start and end date Temporary organization Can be structured and managed separate from the organization as a whole PM s deal with short term development projects while general managers is in charge of running the day-to-day activities Little time to develop and improve the human capital The three goals of a project Performance, cost, and time targets What is managed in a project? Time (Schedule) Cost (Budget) Performance (Goal attainment)

3 Project lifecycles Example of project life cycles (1) It measures the completion of a project as a function of either time or resources It is important for you to understand different cycles and different phases of a cycle since it affects how you should manage Example of project life cycles (2) The manager s different roles (Mintzberg) Interpersonal Team leader, ambassador and ceremonial leader Informative Listener, information giver and spokes person Decision making Visionary, problem solver, resurce allocator and negotiator

4 Leadership The team paradox Great person theory Something you are born with Great opportunity theory Something you can learn Ask what the leader does instead of who he is The more complex a project, the more formal the style of management should be The more technically uncertain a project, the more flexible the style of management Leadership styles (Lewin & Lippit) Authoritative Democratic Laissez-faire Why work in groups? (Schein) Why is it so difficult? Affiliation needs Sense of identity and maintaining our self-esteem Establishing and testing social reality Reducing insecurity, anxiety and sense of powerlessness Problem-solving, task-accomplishing mechanism The work is so temporary Everyone is used to his/her ways Geographical diversity Size Cultural diversity Lack of time

5 Group development Belbin s 9 team roles Forming Storming Norming Performing Adjourning Specialist Monitor/evaluator Plant Teamworker Completer/finisher Shaper Coordinator Implementer Resource investigator Two extreme standpoints To plan or not to plan that is the question Ready, Fire, Aim Paralysis by Analysis

6 The planning process PM s first step Understand the expectations that the organization has for the project Identify who among senior managers has a major interest in the project Determine if anything about the project is atypical Initial meeting with key stakeholders Results: scope understood and temporarily fixed functional managers understand their responsibilities and have committed to developing the initial plan The project plan The primary purpose of the project plan is to serve as a map for the PM of the route from project start to finish The project plan is the lifeline of the project It is a living document that needs constant updating to reflect reality WBS Work breakdown structure (identify tasks) Example of WBS The primary purpose of developing a WBS is to ensure that important tasks are not overlooked and thereby not accounted for and planned Breaking the tasks up into manageable parts that can be performed by individuals in the project Uses a level system, level 1 tasks, level 2 tasks and so on

7 Methods for estimation Example of a project action Algorithmic models Experts Analogies Top-down Bottom-up Budgeting the project Budgets Budgets are plans for allocating organizational resources to project activities. forecasting required resources, quantities needed, when needed, and costs Budgets help tie project to overall organizational objectives Budgets can be used as tool by upper management to monitor and guide projects

8 How to create the budget Budgeting problems The basic problem is that we can t do the old same as last year + X% since we are dealing with unique projects We can use past similar projects as a template Don t forget overheads and indirect costs None of the methods can be used stand alone. PM s are almost always forced to mix the two Upper management are reluctant to let go of their primary control method Top down budgeting means that the budget is set by people with no or little involvement in the project Gantt Gantt chart Developed in 1917 by Henry Gantt It uses graphical representation of tasks Easy to draw Strong connection to the project action plan

9 Gantt chart with slack Risk management What are risks in projects? Human capital Important machinery and other similar resources Environment Internal organization Competitors Government (Laws and regulations) or Everything that might jeopardize the objectives or the business itself Risk = The possibility of something happening x The effect of that occurrence

10 Risk management Risk Identification study of all sources of risk in the project scenario analysis acquire probability data for risks identified Risk Analysis develop risk profiles game theory expected value decision tables Response to Risk which risks to prepare for