Project Manager Responsibilities - Advanced Project Management - Lecture Slides, Slides of Project Management

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Project Manager’s Responsibilities • Project Manager will define: – Goals and objectives – Major milestones – Requirements – Ground rules and assumptions – Time, cost, and performance constraints – Operating procedures – Administrative policy – Reporting requirements Quick Review Senior Management’s Responsibility • Senior management (project sponsor) will: – Act as the negotiator for disagreements between project and line management – Provide clarification of critical issues – Provide communication link with customer’s senior management Quick Review Project Charters • After deciding what project to work on, it is important to formalize projects • A project charter is a document that formally recognizes the existence of a project and provides direction on the project’s objectives and management • Key project stakeholders should sign a project charter to acknowledge agreement on the need and intent of the project What is Project Scope Management? • Scope refers to all the work involved in creating the products of the project and the processes used to create them. It defines what is or is not to be done • Deliverables are products produced as part of a project, such as hardware or software, planning documents, or meeting minutes • The project team and stakeholders must have the same understanding of what products will be produced as a result of a project and how they’ll be produced Project Scope Management Processes • Initiation: beginning a project or continuing to the next phase • Scope planning: developing documents to provide the basis for future project decisions • Scope definition: subdividing the major project deliverables into smaller, more manageable components • Scope verification: formalizing acceptance of the project scope • Scope change control: controlling changes to project scope What can we do to manage & control scope changes?? Methods for Selecting Projects • There are usually more projects than available time and resources to implement them • It is important to follow a logical process for selecting IT projects to work on • Methods include: – focusing on broad needs – categorizing projects – performing financial analyses – using a weighted scoring model – implementing a balanced scorecard Focusing on Broad Organizational Needs • It is often difficult to provide strong justification for many IT projects, but everyone agrees they have a high value • “It is better to measure gold roughly than to count pennies precisely” • Three important criteria for projects: – There is a need for the project – There are funds available – There’s a strong will to make the project succeed Categorizing IT Projects • One categorization is whether the project addresses – a problem – an opportunity – a directive • Another categorization is how long it will take to do and when it is needed • Another is the overall priority of the project NPV Calculations • Determine estimated costs and benefits for the life of the project and the products it produces • Determine the discount rate (check with your organization on what to use) • Calculate the NPV (see text for details) • Notes: Some organizations consider the investment year as year 0, while others start in year 1. Some people enter costs as negative numbers, while others do not. Check with your organization for their preferences. Return on Investment • Return on investment (ROI) is calculated by subtracting the project costs from the benefits and then dividing by the costs ROI = (total discounted benefits - total discounted costs) / discounted costs • The higher the ROI, the better • Many organizations have a required rate of return or minimum acceptable rate of return on an investment • Internal rate of return (IRR) can by calculated by setting the NPV to zero What else do we need to be aware of in calculating ROI??? Payback Analysis • Another important financial consideration is payback analysis • The payback period is the amount of time it will take to recoup, in the form of net cash inflows, the net dollars invested in a project • Payback occurs when the cumulative discounted benefits and costs are greater than zero • Many organizations want IT projects to have a fairly short payback period Balanced Scorecard IS370 Project Management Dr Pat Halloran Role of Performance Measurement • Activities directing any number of pre- defined activities or strategies in order to accomplish an agreed outcome. • Performance Measurements are put in place to find out if a predefined goal/strategy has been achieved. • Without them: Do not know company’s standing in light of their strategic direction Activity • Each group needs to fill in the BSC diagram with the measurement characteristics of customer perspective, as well as business perspective. Google Yahoo Emirates Air Customer Internal business process Learning and growth Financial Conclusion • There is a need for different performance measures to support unique business models • Standardized performance measures display business’ performance within the industry • Performance measures assist the business to assess performance, not to govern business processes Scope Planning and the Scope Statement • A scope statement is a document used to develop and confirm a common understanding of the project scope. It should include – a project justification – a brief description of the project’s products – a summary of all project deliverables – a statement of what determines project success Scope Planning and the Work Breakdown Structure • After completing scope planning, the next step is to further define the work by breaking it into manageable pieces • Good scope definition – helps improve the accuracy of time, cost, and resource estimates – defines a baseline for performance measurement and project control – aids in communicating clear work responsibilities Approaches to Developing WBSs • Using guidelines: Some organizations, like the DoD, provide guidelines for preparing WBSs • The analogy approach: Review WBSs of similar projects and tailor to your project • The top-down approach: Start with the largest items of the project and break them down • The bottom-up approach: Start with the detailed tasks and roll them up • Mind-mapping approach: Write down tasks in a non-linear format and then create the WBS structure Basic Principles for Creating WBSs* 1. A unit of work should appear at only one place in the WBS. 2. The work content of a WBS item is the sum of the WBS items below it. 3. A WBS item is the responsibility of only one individual, even though many people may be working on it. 4. The WBS must be consistent with the way in which work is actually going to be performed; it should serve the project team first and other purposes only if practical. 5. Project team members should be involved in developing the WBS to ensure consistency and buy-in. 6. Each WBS item must be documented to ensure accurate understanding of the scope of work included and not included in that item. 7. The WBS must be a flexible tool to accommodate inevitable changes while properly maintaining control of the work content in the project according to the scope statement. *Cleland, David I. Project Management: Strategic Design and Implementation, 1994 Scope Verification and Scope Change Control • It is very difficult to create a good scope statement and WBS for a project • It is even more difficult to verify project scope and minimize scope changes • Many IT projects suffer from scope creep and poor scope verification – FoxMeyer Drug filed for bankruptcy after scope creep on a robotic warehouse – 21st Century Insurance Group wasted a lot of time and money on a project that could have used off-the-shelf components What factors might present problems for a WBS and consequently the Project??