Certificate IV in Project Management Practice
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1 BSB41515 Certificate IV in Project Management Practice Day 1: Project Initiation Course structure 8-day program Attendance sheet Active participation Assessment portfolio Initiating projects Planning projects (2 days) Project leadership Project delivery & close DAY 1.1
2 Initiating projects Project frameworks What is a project? Projects v business as usual Project methodologies Opportunity definition Project lifecycle The triple constraints Project concept canvas Alternatives analysis Alternatives identification Feasibility analysis Cost estimation The business case Quantifying outcomes Organisational risk Multi-criteria analysis OPEN Unit 1: Project frameworks Project frameworks What is a project? Projects v business as usual Project methodologies DAY 1.2
3 What is a project? OPEN 1.1 A temporary endeavour undertaken to create a unique product, service or result Operations Projects OPEN 1.2 DAY 1.3
4 OPEN 1.3 Projects Operations Temporary / unique Routine / cyclic DISRUPTIVE CHANGE Uncertain performance Significant planning Up-front finance Based on precedent Routine planning Self-financing ORGANIC CHANGE New & complex relationships Established relationships Projectised organisation OPEN 1.4 DAY 1.4
5 Activity 1.1 How well does your organisation manage projects? Discussion What are the benefits of a project methodology? DAY 1.5
6 Project methodology OPEN 1.8 Common language Policies and processes Assets (templates) Definitions Make quicker decisions Project methodology OPEN 1.8 Assures project delivery Enables reliable estimates Optimises resources Reduces risk Solve problems faster DAY 1.6
7 Project methodology OPEN 1.8 Facilitates change Changing personnel Changing requirements Changing environment Realise opportunities Project methodology OPEN 1.8 Client satisfaction Reduces investment costs Improves staff morale Enhances reputation Keep promises DAY 1.7
8 Project methodology OPEN 1.8 Knowledge base Documents lessons learned Templates future projects Culture of project excellence Leverage success Which is best? OPEN 1.8 DAY 1.8
9 Activity 1.2 Why do we document our projects? Can we ever over-document projects? Project assets (templates) OPEN 1.9 DAY 1.9
10 OPEN Unit 1: Project frameworks OPEN Unit 3: Alternatives analysis Opportunity definition Project lifecycle The triple constraints Project concept canvas OPEN 1.5 Project lifecycle DAY 1.10
11 Activity 1.3 Reflect on a project you have recently contributed to How well did you (or the project team) test the project concept with stakeholders? plan the project? manage change during project delivery? capture and communicate lessons learned? The cost of change OPEN 1.6 DAY 1.11
12 The triple constraints OPEN 1.7 Activity 1.4 When might a project have too much time or money? DAY 1.12
13 Project initiation Doing the project right OPEN 3.0 Doing the right project OPEN 3.0 Project initiation DAY 1.13
14 OPEN 3.1 Opportunity definition Current v ideal state Link to the objectives of the organisation paying for it What outcomes / benefits do we need to have? What outcomes / benefits would be nice to have? What is out of scope? And when is the latest we can start? Who do we need to get involved from Day 1? Estimate range ±30-50% Authorise development of business case DAY 1.14
15 Upgrade office technology Improve efficiency and customer service Improve productivity Be scalable for growth Integrate with existing technology Enable new service channels Reduce energy costs Office furniture Telephones Start before end of financial year No more than 6 months to deliver $50,000 - $80,000 Office manager IT manager IT consultants Activity 1.5 The boss wants to honour high performing project managers in our organisation Prepare a project concept canvas for this opportunity PRO TIP Brainstorm benefits before you decide whether they are must or might have outcomes for your solution! DAY 1.15
16 OPEN Unit 3: Alternatives analysis Alternatives analysis Alternatives identification Feasibility analysis Cost estimation OPEN 3.2 Alternatives identification DAY 1.16
17 Alternatives OPEN 3.2 What is the optimal way to realise this opportunity? OPEN 3.2 Creative thinking Alternatives identification Generating ideas Reflection Brainstorming Secondary sources Organising ideas Lists Mind-maps Flowcharts Critical thinking Alternatives analysis Threshold feasibility Is this something people want? Is this something we can do? Is this something we can afford? Is this something we are allowed to do? DAY 1.17
18 Activity 1.6 Identify five (5) alternative ways to realise the outcomes identified in the project concept canvas OPEN 3.2 Feasibility analysis DAY 1.18
19 Relative feasibility OPEN 3.2 Questions to ask Do people want Option A more than Option B? Is it easier for us to produce Option A than B? Is Option A more affordable than Option B? Other methods to use Pros and cons SWOT analysis PESTLE analysis DAY 1.19
20 OPEN 3.6 Project costs Estimating project (output) costs OPEN 5.5 Analogous estimates Parametric estimates Mean (average) Median Mode Three-point estimates DAY 1.20
21 Problem OPEN 5.5 Past performance suggests that freighting a widget from New York to Hobart usually takes about 10 days; however, if the planets align correctly, it can arrive in as few as seven Once though, it actually took 25 days to arrive, and the project suffered as a result How much time should the project team build into their schedule to allow for the widget to arrive? Three point estimate OPEN 5.5 Best case 7 days Most likely 10 days Worst case 25 days t E = (t O + 4t M + t P ) 6 (7 + (4 x 10) + 25) 6 = 12 DAY 1.21
22 Activity 1.7 We need to engage a consultant on a project, but don t really know how much that is going to cost, so we reviewed similar projects to get a reliable estimate We found on a project of this type it usually costs around $7,500; although the true range of prices was $6,000 to $12,000 Using the three-point estimate formula, how much should the project team allow in their budget for consultancy? DAY 1.22
23 OPEN 3.7 Net financial impact Ownership (outcome) costs OPEN 3.7 Operating costs Infrastructure (eg rent) Labour Materials Power & water Insurances Interfaces (eg IT) Strategic costs Repairs & maintenance Operator training Upgrades / scalability Decommissioning DAY 1.23
24 Activity 1.8 A new car costs $20,000 to purchase and $5,000 per year to operate A second-hand car costs $5,000 to purchase and $10,000 per year to operate Which is the better option over two (2) years? Which is the better option over four (4) years? Net financial impact OPEN 3.7 Post-project revenue less ownership (outcome) costs Profit / loss Annualise if possible to enable comparison What is the useful life of each alternative? DAY 1.24
25 Net financial impact (profit) OPEN 3.7 OPEN 3.7 DAY 1.25
26 Activity 1.9 Why is it important to accurately estimate financial costs and impacts? What are the potential consequences of under-estimating? What are the potential consequences of over-estimating? How accurate do we need to be in the business case? Activity 1.9 Why is it important to accurately estimate project costs? What are the potential consequences of under-estimating? What are the potential consequences of over-estimating? How accurate do we need to be in the business case? -20% -10% Actual +10% +20% Business case DAY 1.26
27 OPEN Unit 3: Alternatives analysis The business case Quantifying outcomes Organisational risk Multi-criteria analysis OPEN 3.8 Other impacts DAY 1.27
28 OPEN 3.8 Other impacts Intangibles Knowledge / skills Productivity Stakeholder networks Brand / reputation Corporate culture Community well-being How will we know if our project is a success? Who is impacted? Our organisation Our clients The community The environment How can we measure these benefits? Activity 1.10 Identify potential impacts for the identified alternatives How will you measure these impacts if the project alternative is selected? # clients served / # widgets produced per hour? customer satisfaction score (out of 10)? staff turnover / training costs reduced by x%? # net favourable social media mentions? # safety incidents and near-misses DAY 1.28
29 Other (intangible) impacts OPEN 3.8 OPEN 3.8 DAY 1.29
30 OPEN 3.9 Risk analysis Risk analysis OPEN 3.9 What are the risks to the organisation of each alternative? What are the risks to the organisation of doing nothing? The risks to project delivery are analysed in the project plan DAY 1.30
31 Risk to the organisation time OPEN 3.9 Risk to the organisation cost OPEN 3.9 DAY 1.31
32 Risk to the organisation scope OPEN 3.9 Risk to the organisation experience OPEN 3.9 DAY 1.32
33 Risk to the organisation importance OPEN 3.9 Risk to the organisation operations OPEN 3.9 DAY 1.33
34 Risk to the organisation dependencies OPEN 3.9 Risk to the organisation brand OPEN 3.9 DAY 1.34
35 Risk to the organisation safety OPEN 3.9 Activity 1.11 Perform an organisational risk assessment for an awards night DAY 1.35
36 OPEN 3.10 OPEN 3.10 Recommendation DAY 1.36
37 Multi criteria analysis Compare alternatives across common criteria Use standard scores for each criteria Best score wins! Criteria should be clearly defined by the organisation Criteria can also be weighted by the organisation Multi criteria analysis (MCA) OPEN 3.10 Option Zero Do nothing Has no project cost Option 1 - $2500 bonus Will cost 2-5% of our program budget Option 2 Awards night Will cost 10-20% of our program budget DAY 1.37
38 Multi criteria analysis (MCA) OPEN 3.10 Option 1 - $2500 bonus Will increase our profit by less than 1% Option 2 Awards night Will increase our profit by less than 1-2% Multi criteria analysis (MCA) OPEN 3.10 Option 1: Improve org / stakeholder well-being by 1-2% Option 2: Improve org / stakeholder by 2-5% DAY 1.38
39 Multi criteria analysis (MCA) OPEN 3.10 Weighted MCA OPEN 3.10 DAY 1.39
40 Sample recommendation OPEN 4.1 It is recommended that detailed planning commence on Option B. A complete project plan is to be presented for Board approval in four (4) weeks time The plan should continue the assumptions made in the business case, and include a detailed WBS, schedule, budget, stakeholder and risk registers and any other documentation deemed relevant by the PMO The PMO should also recommend at that time the appointment of a suitably qualified project manager and project steering committee If the assumptions of the business case are invalidated by the planning process, the board should be duly advised and a new course of action recommended It is proposed that a budget of $15,000 be allocated to planning the project Other recommendation detail OPEN 4.1 Planning constraints Time key milestones Cost high-level budget Scope key deliverables Quality acceptance criteria Critical success factors For example Resource availability assumptions Other project dependencies Key stakeholder relationships Known project risks DAY 1.40
41 Activity 1.12 What are some other criteria you could use to evaluate project alternatives? DAY 1.41
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