CONTENTS
Preface xxiii
Acknowledgments xxv
Author . xxvii
PART I Conceptual Overview of the Project Environment
Chapter 1 Introduction 3
1.1 Project Management ...................................................................................... 3
1.2 Role of the Project Manager .......................................................................... 4
1.3 Project Manager Skills ................................................................................... 4
1.3.1 Success Management .......................................................................... 5
1.4 Text Content and Organization ...................................................................... 6
1.4.1 Text Structure ..................................................................................... 6
Appendices ............................................................................................................... 7
References ................................................................................................................ 8
Chapter 2 Evolution of Project Management ............................................................................. 9
2.1 Early History of Project Management ........................................................... 9
2.2 Application of Analytical Science ............................................................... 10
2.3 Frederick Taylor and Scientific Management .............................................. 10
2.4 Frank and Lillian Gilbreth ........................................................................... 11
2.5 Henry Gantt ................................................................................................. 12
2.6 Mary Parker Follett ...................................................................................... 12
2.7 Elton Mayo ................................................................................................... 13
2.8 Phases of Project Management Evolution .................................................... 13
2.9 Project Management Challenges ..........................777..................................... 17
2.10 Project Management Benefits ...................................................................... 18
2.10.1 At the Macrolevel ........................................................................... 18
2.10.2 At the Microlevel ............................................................................ 18
References .............................................................................................................. 18
'hapter 3 Project Management Body of Knowledge .............................................................. 21
3.1 High Level Overview ................................................................................... 21
3.2 History of PMBOK® Guide development .................................................... 22
3.3 Structure of the PMBOK9 Guide ................................................................. 22
3.3.1 Project Domains ............................................................................... 22
3.3.1.1 Initiation ............................................................................ 24
3.3.1.2 Planning ............................................................................ 25
3.3.1.3 Execution .......................................................................... 25
3.3.1.4 Monitoring and Controlling .............................................. 25
3.3.1.5 Closing .............................................................................. 25
3.3.2 Knowledge Areas ............................................................................. 26
3.3.2.1 Scope Management ........................................................... 26
3.3.2.2 Time Management ............................................................. 26
3.3.2.3 Cost Management .............................................................. 26
3.3.2.4 Quality Management ......................................................... 27
3.3.2.5 Human Resources Management ........................................ 27
3.3.2.6 Communications Management .......................................... 27
3.3.2.7 Risk Management .............................................................. 27
3.3.2.8 Procurement Management ................................................. 28
3.3.2.9 Integration Management .................................................... 28
3.3.2.10 Overall Process View ........................................................ 28
3.4 Key Introductory Vocabulary Terms ........................................................... 29
3.5 Ancillary Models ......................................................................................... 30
3.6 Summary ...................................................................................................... 31
Reference ................................................................................................................ 31
Chapter 4 Industry Trends in Project Management ................................................................ 33
4.1 Standardizing Project Management ............................................................. 33
4.2 Enterprise Project Management ................................................................... 33
4.3 EPM in Operation ........................................................................................ 35
4.4 Implementation and Advantages of EPM .................................................... 35
4.5 Other Trends Impacting Project Management ............................................. 36
4.6 Project Management Perspective ................................................................. 37
Discussion Questions .............................................................................................. 37
References .............................................................................................................. 37
Chapter 5 Project Types .......................................................................................................... 39
Reference ................................................................................................................ 42
Chapter 6 Project Organization Concepts ............................................................................... 43
6.1 PM Role ....................................................................................................... 43
6.2 Reporting Relationships ............................................................................... 43
6.3 Team Resources ........................................................................................... 44
6.4 Team Productivity and Size ......................................................................... 44
6.5 Team's Physical Location Issues .................................................................. 45
6.6 Virtual Organizations .................................................................................. 46
6.7 Organizational Culture ................................................................................ 47
6.8 Summary ...................................................................................................... 48
References .............................................................................................................. 48
Chapter 7 Project Life Cycle Models ...................................................................................... 49
7.1 Overview of Project Methodologies ............................................................ 49
7.2 Life Cycle Management Process .................................................................. 50
7.2.1 Feasibility Review .......................................................................... 50
7.2.2 Project Plan ..............................................
7.2.3 Logical versus Physical Design ...................................................... 51
7.2.4 Quality Control and Assurance ...................................................... 51
7.2.5 Monitor and Control ....................................................................... 52
7.2.6 Periodic Status Reviews .................................................................. 52
7.2.7 Milestone or Stage Gate Reviews ................................................... 52
7.2.8 Project Close ................................................................................... 52
7.2.9 Project Communication Processes ................................................. 52
7.2.10 Life Cycle Models .....................................v................................... 53
7.2.11 Templates ......................................................................................... 53
7.3 Key Project Management Artifacts ............................................................. 53
7.3.1 Initiating ......................................................................................... 54
7.3.2 Planning .......................................................................................... 54
7.3.3 Execution ...................................................v................................... 54
7.3.4 Monitoring and Control .................................................................. 54
7.3.5 Baseline ....................................................,...'..\................................ 54
7.4 Project Methodology Models ....................................................................... 55
7.5 Summary Points ........................................v................................................. 56
7.6 Potential Shortcomings of Project Methodologies x ...................................... 57
References ........................................................................................^.................... 57
Chapter 8 Quick Start Example .............................................................................................. 59
8.1 Project Management Work Packages ........................................................... 59
8.2 WP Dictionary ............................................................................................. 59
8.3 Multiple WPs ............................................................................................... 60
8.4 Psychology of Estimating ............................................................................ 61
8.5 Procrastination ............................................................................................. 62
8.6 Developing the Whole Project View ............................................................ 63
8.7 Project Scope ............................................................................................... 63
8.8 Example: Pool Project Mechanics ............................................................... 64
8.9 Quick Start Wrap-Up ................................................................................... 67
Discussion Questions .............................................................................................. 68
Reference ................................................................................................................ 68
Concluding Remarks for Part I ............................................................................... 69
PART II Projects as State Change Vehicles ' -J
Chapter 9 Role of Projects in the Organization ...................................................................... 73
9.1 Project Valuation Models ............................................................................. 73
9.2 Project Selection Strategies .......................................................................... 75
9.3 Conclusion .................................................................................................... 78
References .............................................................................................................. 78
Chapter 10 Project Initiation ..................................................................................................... 79
10.1 Environmental Factors to Consider ............................................................. 83
10.1.1 User Involvement ............................................................................ 84
10.1.2 Executive Management Support ..................................................... 84
10.1.3 Experienced PM ............................................................................. 85
10.1.4 Communications ............................................................................. 85
10.1.5 Clear Business Objectives .............................................................. 86
10.1.6 Minimized Scope ........................................................................... 87
10.1.7 Other Success Factors ..................................................................... 87
10.1.7.1 Agile Development Approaches ...................................... 87
10.1.7.2 Existence of a Standard Process Infrastructure .............. 88
10.1.7.3 Use of a Standard Methodology ...................................... 88
10.1.7.4 Reliable Time Estimates ................................................. 89
10.1.7.5 Availability of Appropriate Skills ................................... 89
10.1.8 Industry and Organizational Culture .............................................. 89
10.2 Predicting a Project's Success ...................................................................... 89
10.3 Forecasting the Success of Technology Projects ......................................... 90
10.4 Conclusion .................................................................................................... 92
References .............................................................................................................. 92
Concluding Remarks for Part II ............................................................................. 93
Defining the Triple Constraints
Chapter 11 Project Plan Development ...................................................................................... 99
11.1 Arguments for Planning ............................................................................. 100
11. .1 Project Monitoring and Control .................................................... 100
11. .2 Conflicting Expectations .............................................................. 101
11. .3 Overlooking the Real Solution ..................................................... 101
11. .4 Competing Solutions ..................................................................... 101
11. .5 Misaligned Goals .......................................................................... 101
11.1.6 Quality Solutions .......................................................................... 101
11.2 Plan Process and Components ................................................................... 102
11.3 Initial Planning View ................................................................................. 102
11.4 Plan Artifacts ............................................................................................. 103
11.5 Real-World Planning Process .................................................................... 104
1 1.6 Conclusion .................................................................................................. 104
References ............................................................................................................ 105
'hapter 12 Scope Management .............................................................................................. 107
12.1 Denning Project Work Units ...................................................................... 108
12.2 WP Planning Variables ....................................................................'.......... 108
12.3 Multiple WPs ............................................................................................. 109
12.4 Developing the Project View ..................................................................... 110
12.5 Developing Project WBS ........................................................................... 110
12.6 WBS Mechanics ........................................................................................ 113
12.6.1 WBS Numbering Scheme ............................................................. 115
12.6.2 WBS Dictionary ........................................................................... 116
12.6.3 Other WBS Views ........................................................................ 117
12.6.4 Tracking Status of the WP ............................................................ 117
12.7 WBS Construction Mechanics ................................................................... 118
12.8 Requirements "Ibilities" ............................................................................ 121
12.9 Moving Forward ........................................................................................ 122
References ............................................................................................................ 123
Chapter 13 Time Management ................................................................................................ 125
13.1 Defining Project Work Activities ............................................................... 125
13.1.1 Activity Definitional Data Elements ............................................ 127
13.2 Activity Sequencing ................................................................................... 127
13.3 Duration Estimating ................................................................................... 128
13.4 Tips for Accurate Estimating ..................................................................... 128
13.4.1 Types of Estimates ....................................................................... 129
13.4.2 Estimating Techniques ................................................................. 130
13.4.2.1 Expert Judgment ........................................................... 130
13.4.2.2 Analogous Estimating .................................................. 130
13.4.2.3 Heuristic Estimating ..................................................... 131
13.4.2.4 Delphi Technique .......................................................... 131
13.4.2.5 Parametric Estimating .................................................. 132
13.4.2.6 Phased Estimating ........................................................ 133
13.4.2.7 Effort Distribution Estimating (Top-Down) ................. 135
13.4.2.8 Bottom-Up Estimating .................................................. 136
13.4.2.9 Monte Carlo Simulation ................................................ 137
13.5 Activity Sequencing ................................................................................... 137
13.5.1 Arrows and Boxes Models ........................................................... 137
13.5.2 AON Model .................................................................................. 138
13.6 Time Calculation ........................................................................................ 139
13.7 Network Mechanics ................................................................................... 139
13.8 Establishing the Project Activity Sequence ............................................... 140
13.9 Forward Pass Calculation .......................................................................... 141
13.10 Backward Pass Calculation ........................................................................ 142
13.11 Defining Critical Path ................................................................................ 143
13.12 Manipulating the Schedule ........................................................................ 144
13.12.1 Automated Calculation Tools ....................................................... 144
13.13 Formatting Activity Results ....................................................................... 144
13.14 Which Diagram Format Wins? .................................................................. 145
13.15 Summary .................................................................................................... 146
13.16 Estimating Checklist .................................................................................. 146
References ............................................................................................................ 147
Chapter 14 Cost Management ................................................................................................. 149
14.1 Project Cost Planning Basics ..................................................................... 149
14.2 Cost Planning ............................................................................................. 150
14.3 Cost Accuracy ............................................................................................ 150
14.4 Organizational Overhead ........................................................................... 151
14.5 Scope, Time, and Cost Alignment ............................................................. 151
14.5.1 Scope Replanning ......................................................................... 151
14.5.2 Fast Tracking ................................................................................ 152
14.5.3 Schedule Crashing ........................................................................ 152
14.6 Indirect Costs ............................................................................................. 154
14.7 Resource Alignment .................................................................................. 154
14.8 Budget Reserves ......................................................................................... 157
14.8.1 Approved Changes ....................................................................... 157
14.8.2 Risk Events ................................................................................... 158
14.8.3 Management Reserve ................................................................... 158
Chapter 13 Time Management ................................................................................................ 125
13.1 Defining Project Work Activities ............................................................... 125
13.1.1 Activity Definitional Data Elements ............................................ 127
13.2 Activity Sequencing ................................................................................... 127
13.3 Duration Estimating ................................................................................... 128
13.4 Tips for Accurate Estimating ..................................................................... 128
13.4.1 Types of Estimates ....................................................................... 129
13.4.2 Estimating Techniques ................................................................. 130
13.4.2.1 Expert Judgment ........................................................... 130
13.4.2.2 Analogous Estimating .................................................. 130
13.4.2.3 Heuristic Estimating ..................................................... 131
13.4.2.4 Delphi Technique .......................................................... 131
13.4.2.5 Parametric Estimating .................................................. 132
13.4.2.6 Phased Estimating ........................................................ 133
13.4.2.7 Effort Distribution Estimating (Top-Down) ................. 135
13.4.2.8 Bottom-Up Estimating .................................................. 136
13.4.2.9 Monte Carlo Simulation ................................................ 137
13.5 Activity Sequencing ................................................................................... 137
13.5.1 Arrows and Boxes Models ........................................................... 137
13.5.2 AON Model .................................................................................. 138
13.6 Time Calculation ........................................................................................ 139
13.7 Network Mechanics ................................................................................... 139
13.8 Establishing the Project Activity Sequence ............................................... 140
13.9 Forward Pass Calculation .......................................................................... 141
13.10 Backward Pass Calculation ........................................................................ 142
13.11 Defining Critical Path ................................................................................ 143
13.12 Manipulating the Schedule ........................................................................ 144
13.12.1 Automated Calculation Tools ....................................................... 144
13.13 Formatting Activity Results ....................................................................... 144
13.14 Which Diagram Format Wins? .................................................................. 145
13.15 Summary .................................................................................................... 146
13.16 Estimating Checklist .................................................................................. 146
References ............................................................................................... 147
Chapter 14 Cost Management ................................................................. 149
14.1 Project Cost Planning Basics ..................................................................... 149
14.2 Cost Planning ............................................................................................. 150
14.3 Cost Accuracy ............................................................................................ 150
14.4 Organizational Overhead ........................................................................... 151
14.5 Scope, Time, and Cost Alignment ............................................................. 151
14.5.1 Scope Replanning ......................................................................... 151
14.5.2 Fast Tracking ................................................................................ 152
14.5.3 Schedule Crashing ........................................................................ 152
14.6 Indirect Costs ............................................................................................. 154
14.7 Resource Alignment .................................................................................. 154
14.8 Budget Reserves ......................................................................................... 157
14.8.1 Approved Changes ....................................................................... 157
14.8.2 Risk Events ................................................................................... 158
14.8.3 Management Reserve ................................................................... 158
17.9.1.3 Milestone Tracking versus Buffer Management
Reporting ...................................................................... 196
17.9.1.4 Existing Processes ........................................................ 196
17.9.1.5 Existing Project Management Methodology ................ 196
17.9.1.6 Existing Tools and Processes ........................................ 197
17.9.1.7 Formal Tracking and Reporting Mechanisms .............. 197
17.9.1.8 Resistance to Change .................................................... 197
17.9.2 Leadership Challenges ................................................................. 197
17.9.2.1 Project Control .............................................................. 198
17.9.2.2 Planning Support .......................................................... 198
17.9.2.3 WBS Development ....................................................... 198
17.9.2.4 Schedule Development ................................................. 198
17.9.2.5 Buffer Calculations ....................................................... 198
17.9.2.6 Dictated versus Derived Scheduling ............................. 198
17.9.2.7 Project Prioritization ..................................................... 199
17.9.2.8 Resource Commitment ................................................. 199
17.9.2.9 Multitasking .................................................................. 199
17.9.2.10 Prioritization ................................................................. 200
17.9.3 Skill Requirements ....................................................................... 200
17.9.3.1 Task Time Estimation ................................................... 200
17.9.3.2 Estimating Logic .......................................................... 200
17.9.3.3 Project Manager ............................................................ 201
17.9.3.4 Team Members ............................................................. 201
17.9.3.5 Task Status Reporting ................................................... 202
17.10 Buffer Management ................................................................................... 202
17.11 Organizational Challenges of the CC ........................................................ 203
17.12 CC Implementation Strategies ................................................................... 203
17.13 Conclusion .................................................................................................. 204
References ............................................................................................................ 205
PART V Planning Support Processes
Chapter 18 Human Resource Management ...................................................... 209
18.1 HR Planning .............................................................................................. 209
18.2 HR in Execution ......................................................................................... 210
18.3 Acquire Project Team ................................................................................ 210
18.4 Project Organizations ................................................................................ 211
18.4.1 Dotted Lines ................................................................................. 212
18.4.2 People Issues ................................................................................ 213
18.5 Role Specifications ..................................................................................... 213
18.6 Responsibility Assignment Matrix ............................................................ 214
18.7 Resource Histograms ................................................................................. 214
18.8 Staff Management Plan .............................................................................. 215
18.9 Motivation Theory ..................................................................................... 215
18.10 Individual Motivation Theories ................................................................. 215
18.11 Team Motivation .................................... 18.12 218
Hygiene Dissatisfiers .................................................................................. 219
18.13 Employee Satisfaction ................................................................................ 220
18.14 Conflict Management ................................................................................. 220
18.14.1 Conflict Sources ........................................................................... 221
18.15 Negotiation Skills ....................................................................................... 222
18.16 Techniques for Handling Conflict .............................................................. 223
18.17 Conflict Management Scenario Case ......................................................... 224
18.18 Leader versus Manager? ............................................................................ 224
18.19 Attributes of a Leader ................................................................................ 224
18.20 Training Programs ..................................................................................... 225
18.21 Summary .................................................................................................... 226
References ............................................................................................................ 226
Chapter 19 Project Communications ...................................................................................... 229
19.1 Introduction ................................................................................................ 229
19.2 ..Engaging Employees: A Case Study .......................................................... 229
19.3 Communications Management Processes .................................................. 230
^,,19.4 Identify Stakeholders ................................................................................. 230
19.5 Plan Communications ................................................................................ 230
19.6 Distribute Information ............................................................................... 232
19.7 Manage Stakeholder Expectations ............................................................. 232
19.8 Report Performance ................................................................................... 233
19.9 Human Communications Model ................................................................ 234
19.10 Communication Channels .......................................................................... 237
19.11 Communicating Information ..................................................................... 239
19.12 Improving the Effectiveness of Communication ....................................... 239
19.13 Effective Listening ..................................................................................... 239
19.14 Barriers to Effective Communication ........................................................ 239
19.15 Communication Tension ............................................................................ 240
19.16 Communication Styles ............................................................................... 241
19.17 Communications: The Impossible Goal? ................................................... 241
19.18 Conclusion .................................................................................................. 242
Discussion Questions ............................................................................................ 242
References ............................................................................................................ 242
Chapter 20 Procurement Management .................................... 245
20.1 Introduction ................................................................................................ 245
20.2 Procurement Management ......................................................................... 245
20.3 Make or Buy Decision ............................................................................... 246
20.4 Procurement Management Processes ........................................................ 247
20.5 Planning for Procurement .......................................................................... 248
20.5.1 Planning Stage Outputs ................................................................ 248
20.5.2 Procurement SOW ........................................................................ 248
20.6 Conduct Procurements ............................................................................... 249
20.6.1 Requests for Information .............................................................. 249
20.6.2 Requests for Proposals ................................................................. 249
20.6.3 Requests for Quotation ..............................:.................................. 250
20.6.4 Invitations for Bid ......................................................................... 250
20.6.5 Invitation to Negotiation ............................................................... 250
20.7 Bidding Process ......................................................................................... 250
20.8 Selecting Sellers ......................................................................................... 251
20.9 Contract Negotiation .................................................................................. 251
20.10 Contracts .................................................................................................... 253
20.11 Administer Procurement ............................................................................ 254
20.12 Procurement Audits ................................................................................... 255
20.13 Contract Review and Reporting ................................................................. 255
20.13.1 Record Keeping and Audits ......................................................... 256
20.14 Close Procurements ................................................................................... 256
20.15 Procurement of Human Services ............................................................... 257
20.16 Ranking Vendor Proposals ........................................................................ 258
20.16.1 Instructions ................................................................................... 258
20.17 Summary .................................................................................................... 258
Discussion Questions ............................................................................................ 260
Glossary of Procurement Terms ........................................................................... 260
Appendix: Legal Terms ........................................................................................ 261
References ............................................................ 263
Chapter 21 Quality Management ............................................................................................ 265
21.1 Introduction ................................................................................................ 265
21.2 Evolution of Quality ................................................................................... 265
21.3 Definition of Quality .................................................................................. 266
21.4 Project Quality Management ..................................................................... 268
21.5 Quality Perspective .................................................................................... 268
21.6 Implications for Project Planning Stage .................................................... 269
21.7 Quality Planning ........................................................................................ 269
21.7.1 Quality Policy ............................................................................... 269
21.7.2 Quality Objectives ........................................................................ 270
21.8 Quality Management Components ............................................................ 271
21.9 Quality Definition ...................................................................................... 271
21.10 Quality Planning ........................................................................................ 271
21.11 Quality Assurance ..................................................................................... 272
21.12 Quality Control ........................................................................... 273
21.13 QA versus QC Operational Roles .............................................................. 273
21.14 Quality Gurus ............................................................................................ 274
21.14.1 Edwards Deming .......................................................................... 274
21.14.2 Joseph Juran ................................................................................. 275
21.14.3 Philip Crosby ................................................................................ 275
21.14.4 Kaoru Ishikawa ............................................................................ 276
21.14.5 Armand Feigenbaum .................................................................... 276
21.14.6 Genichi Taguchi ........................................................................... 276
21.14.7 Six Sigma ..................................................................................... 276
21.14.8 Other Gurus .................................................................................. 276
21.15 Quality Management Programs ................................................................. 277
21.15.1 ISO 9000 ...................................................................................... 277
21.15.2 Zero Defects ................................................................................. 277
21.15.3 Total Quality Management ........................................................... 277
21.15.4 Six Sigma ..................................................................................... 278
21.15.4.1 Statistical Definition of Six Sigma ............................... 278
21.15.4.2 Six Sigma Fascination .................................................. 278
21.15.4.3 Basic Methodologies ..................................................... 280
Sg; 21.15.4.4 DMAIC Process Overview ........................................... 281
•~r 21.16 PMBOK® Guide Quality Process Model ................................................... 283
r ^ 21.17 Other Programs .......................................................................................... 283
I 21.18 Evaluating Quality ..................................................................................... 283
21.18.1 Benchmarking .............................................................................. 284
21.18.1.1 What Is It? ..................................................................... 284
21.18.1.2 Types of Benchmarking ................................................ 284
21.18.1.3 J. D. Power's Quality Benchmarking ............................ 284
21.19 Continuous Improvement ........................................................................... 285
21.20 Failure Mode and Effects Analysis ............................................................ 285
21.21 Quality Tools .............................................................................................. 286
21.22 Other Quality Analysis Techniques ........................................................... 288
21.22.1 Design of Experiments ................................................................. 288
21.22.2 Quality Function Deployment ...................................................... 289
21.23 Organizational Roles and Responsibilities ................................................ 290
21.24 Issues in Quality Management ................................................................... 291
21.25 Toyota Quality Perspective ........................................................................ 291
21.26 Future of Quality Management .................................................................. 293
21.27 Worksheet Exercise: Are You Meeting Quality Goals? ............................ 294
Discussion Questions................................................................................................296
References ............................................................................................................ 296
Chapter 22 Risk Management ................................................................................................. 297
22.1 Introduction ................................................................................................ 297
22.2 Risk Management Process ......................................................................... 300
22.3 Risk Management Planning ....................................................................... 301
22.3.1 Developing an RBS ...................................................................... 303
22.4 Risk Identification ...................................................................................... 303
22.5 Qualitative and Quantitative Risk Analysis ............................................... 307
22.6 Risk Assessment ........................................................................................ 307
22.7 Risk Contingency Budget .......................................................................... 311
22.8 Risk Response Planning ............................................................................ 311
22.9 Risk Monitoring and Control ..................................................................... 313
22.10 Risk Events versus Issues ........................................................................... 313
22.11 Project Risk Assessment Worksheet .......................................................... 313
22.12 Risk Case Study ......................................................................................... 314
22.12.1 Mishap Foils Latest Attempt at a 25-Mile Skydive ..................... 314
22.13 Conclusion .................................................................................................. 314
Discussion Questions ............................................................................................ 316
References ............................................................................................................ 316
Chapter 23 Plan Review and Approval ....................;..........;................................................... 317
23.1 Reviewing Plan Components ..................................................................... 317
23.2 Plan Approval Process ............................................................................... 318
23.3 Review Major Planning Artifacts .............................................................. 318
23.4 Financial and Control Structures ............................................................... 319
23.4.1 Scope Reserve ............................................................................. 321
23.4.2 Risk Reserve ............................................................................... 321
<>:•:, ............. 23.4.3 Level of Effort ............................................................................ 321
0,v; ...'.....'..I 23.4.4 Overhead ..................................................................................... 322
{).}•• 23.4.5 Management Reserve .................................................................. 322
l',y 23.4.6 Profit ........................................................................................... 323
23.4.7 Budget Structure and Format ...................................................... 323
c 23.4.8 Control Structure ........................................................................ 324
23.5 Documentation Plan Packaging ................................................................. 325
''•*,' 23.6 External Communication Process ............................................................. 325
23.7 Planning Stage Close ................................................................................. 326
Discussion Questions ............................................................................................ 327
PART VI Project Execution— Managing the Plan
Chapter 24 Project Execution and Control ............................................................................. 331
24.1 Introduction ................................................................................................ 331
24.1.1 Magic Twelve Success Indicators ............................................... 331
24.2 Status View ................................................................................................ 332
24.2.1 Status-Tracking Processes .......................................................... 333
24.2.2 Turning the Management and Control Knobs ............................ 335
24.2.2.1 ICC Process ................................................................. 336
...... 24.3 Human Relations and Communications Issues .......................................... 336
24.3.1 Team Acquisition ........................................................................ 337
24.3.1.1 Developing the Project Team ...................................... 337
24.3.1.2 Team Development ...................................................... 338
24.3.1.3 Team Skills and Capabilities ....................................... 339
\:------ . 24.3.2 Manage Project Team ................................................................. 339
24.3.2.1 Motivation Level ......................................................... 339
24.3.3 Meetings as Information Sources ............................................... 340
24.3.3.1 Meeting Structure ....................................................... 341
24.3.3.2 Management Involvement ........................................... 341
24.4 Project Team Member Dissatisfiers ........................................................... 342
24.5 Project Team Member Motivators ............................................................. 343
24.6 Conclusion .................................................................................................. 344
Discussion Questions ............................................................................................ 344
References .....:...................................................................................................... 345
PAfff VII Monitoring and Controlling Techniques
Chapter 25 Change Management ............................................................................................ 351
25.1 Introduction ................................................................................................ 351
25.2 Integrated Change Control ......................................................................... 351
25.3 Project Management Plan .......................................................................... 352
25.4 Change Control System ............................................................................. 354
25.5 Configuration Management ....................................................................... 356
25.6 Change Management Workflow ................................................................. 357
25.7 External Communication Issues ................................................................ 358
XV1 . -! Content*
•— 25.8 Project Operational Integration ................................................................. 355
25.9 Summary ................................................................................................... 3$
25.10 Change Request Checklist ......................................................................... 360
References ............................................................................................................ 361
Chapter 26 Project and Enterprise Metrics ............................................................................. 363
26.1 Introduction ................................................................................................ 363
26.2 Fundamentals ............................................................................................. 363
26.2.1 Alignment with Organization Goals ............................................ 363
26.3 Alignment with Organizational Maturity .................................................. 365
26.4 Drivers of Performance and Change .......................................................... 366
26.5 Summary Categories .................................................................................. 366
26.6 Metrics Evaluation Criteria ........................................................................ 368
26.7 Establishing a Baseline and Setting Targets .............................................. 370
'''•'- 26.8 Beware of the Metrics Pitfalls ................................................................... 370
26.9 Mechanics .................................................................................................. 371
26.9.1 Miscellaneous Issues .................................................................. 372
26.10 Industry Standard Metrics for Monitoring and Control ............................ 374
26.11 Conclusion .................................................................................................. 374
References ............................................................................................................ 375
Chapter 27 Earned Value Management ......................................................."......."...'.'.............. 377
27.1 Basic Principles .......................................................................................... 378
27.2 Calculating EV Parameters ........................................................................ 380
27.3 Interpreting EV Parameters ....................................................................... 380
27.4 EVM Criteria ............................................................................................. 382
27.5 EVM Simplified ......................................................................................... 382
27.6 EVM for Commercial Applications ........................................................... 383
27.7 Emerging Applications of EVM ................................................................ 384
27.7.1 Earned Schedule ........................................................................... 385
27.8 ES Mathematical Formulation ................................................................... 386
27.8.1 ES Formulae ................................................................................. 387
27.8.2 ES Indicators ................................................................................ 388
27.9 EVM Pros and Cons .................................................................................. 388
27.10 Conclusions ................................................................................................ 389
Appendix .............................................................................................................. 389
A. Summary Review of EV Metrics and Performance Parameters ....... 389
B. EV Formulae and Interpretation ........................................................ 390
C. Using a Summary Project Plan Spreadsheet to
Calculate EV Parameters ................................................................... 390
D. EV Earning Rules .............................................................................. 390
References ............................................................................................................ 394
Chapter 28 Tracking Project Progress .................................................................................... 395
28.1 Introduction ................................................................................................ 395
28.2 Status Tracking .......................................................................................... 395
28.3 Tracking Metrics ........................................................................................ 397
28.4 Information Distribution ............................................................................ 397
28.5 Control ....................................................................................................... 398
Contents
XVII
28.5.1 Project Plan .................................................................................. 399
28.5.2 Issue Management Process ........................................................... 399
28.5.3 Configuration Management ...............................^......................... 399
28.5.4 Integrated Change Control .........................../............................... 400
28.6 KA Controls ............................................................................................... 400
28.6.1 Scope Control ............................................................................... 400
28.6.2 Schedule Control .......................................................................... 400
28.6.3 Cost Control ................................................................................. 400
28.6.4 Quality Control ............................................................................. 401
28.7 Project Status Tracking Case Study ........................................................... 402
28.8 Conclusion .................................................................................................. 403
References ............................................................................................................ 403
Chapter 29 Enterprise Reporting Using the Balanced Scorecard ........................................... 405
29.1 Introduction ................................................................................................ 405
29.2 Scorecard Implementation ......................................................................... 406
29.2.1 Communicating Strategic Objectives ........................................... 406
29.2.2 Communicating Strategy .............................................................. 406
29.2.3 Assigning Responsibility .............................................................. 406
29.2.4 Aligning Strategy ......................................................................... 406
29.2.5 Process Integration ....................................................................... 407
29.3 BSC Implementation Principles ................................................................. 407
29.3.1 Best Practices ............................................................................... 407
29.3.2 Barriers to Success ....................................................................... 408
29.4 BSC Model ................................................................................................. 408
29.4.1 Financial Perspective .................................................................... 410
29.4.2 Internal Business Process Perspective ......................................... 410
29.4.3 Learning and Growth Perspective ................................................ 410
29.4.4 Customer Perspective ................................................................... 411
29.5 BSC as a Strategic Management System ................................................... 411
29.5.1 Overcoming the Vision Barrier .................................................... 411
29.5.2 Overcoming the People Barrier .................................................... 412
29.5.3 Overcoming the'Resource Barrier ............................................... 412
29.5.4 Overcoming the Management Barrier .......................................... 413
29.6 BSC as a Communication Tool .................................................................. 413
29.7 Balancing the BSC Components ................................................................ 413
29.8 Advantages and Disadvantages of BSC ..................................................... 414
29.8.1 Advantages ................................................................................... 414
29.8.2 Disadvantages ............................................................................... 415
29.9 Future of the BSC ...................................................................................... 415
29.10 Conclusion .................................................................................................. 415
References ............................................................................................................ 416
Part VIII Closing the Project
Chapter 30 The Closing Process ............................................................................................. 419
30.1 Project Implementation Review ................................................................. 419
30.1.1 Normal Project Termination ........................................................ 420
30.2 Abnormal Termination ........................J^..;....\...'L...l.?.............................. 421
30.3 Termination Model .................................................................................... 421
30.4 Project Termination Checklist ................................................................... 421
30.5 Project Team and Client Relationship ........................................................ 423
30.6 Creating Lessons Learned Documentation ................................................ 423
30.7 Lessons Learned Report ............................................................................ 424
30.8 Project Team Celebration ........................................................................... 424
30.9 Conclusion .................................................................................................. 425
References ............................................................................................................ 425
PART IX Contemporary Topics
Chapter 31 Organizational Maturity ....................................................................................... 429
31.1 Introduction ................................................................................................ 429
31.2 Overview of Formal CMMs ...................................................................... 430
31.3 SEI's CMM ................................................................................................ 431
31.4 CMM Structure .......................................................................................... 431
31.5 CMM Maturity Levels ............................................................................... 432
31.5.1 Initial Level (Level 1) ................................................................... 432
31.5.2 Repeatability Level (Level 2) ....................................................... 432
31.5.3 Defined Level (Level 3) ................................................................ 433
31.5.4 Managed Level (Level 4) .............................................................. 433
31.5.5 Optimizing Level (Level 5) .......................................................... 433
31.6 Capability Maturity Model Integration (CMMI) ....................................... 433
31.7 Value of Organizational Maturity .............................................................. 434
31.8 Organizational Project Management (OPM3) ........................................... 435
31.9 Overview of OPM3 .................................................................................... 436
31.10 OPM3 Components .................................................................................... 438
31.10.1 Knowledge .................................................................................... 438
31.10.2 Assessment ................................................................................... 438
31.10.3 Evaluation Process ....................................................................... 438
31.11 Best Practices ............................................................................................. 439
31.12 Capabilities Directory ................................................................................ 439
31.13 Improvement Planning Directory .............................................................. 439
31.14 OPM3 Processes ........................................................................................ 442
31.15 Applying OPM3 in an Organization .......................................................... 443
31.16 OPM3 Benefits and Case Studies .............................................................. 444
31.17 Conclusion ................................................................................................. 445
References ............................................................................................................ 446
Chapter 32 Project Portfolio Management .............................................................................. 447
32.1 Introduction ................................................................................................ 447
32.2 Role of PPM ............................................................................................... 447
32.3 Improving Project Selection Decisions ...................................................... 448
32.4 Improving Visibility of Project Performance ............................................ 448
32.5 Better Understanding of Project Value ...................................................... 448
32.6 Conducting "What If Analysis ................................................................. 449
32.7 Project Investment Management ................................................................ 449
32.8 Who Needs a PPM? ................I.'..;.:...V.!..................................................... 449
32.9 PPM Goal Structure ................................................................................... 450
^f- .... 32.9.1 Subgoal 1: Strategic Goal Alignment ........................................... 451
32.9.2 Subgoal 2: Resource Investment Focus ........................................ 451
32.9.3 Subgoal 3: Better Project Control/Governance ............................ 451
32.9.4 Subgoal 4: Efficiency .................................................................... 452
32.9.5 Subgoal 5: Balance ....................................................................... 452
32.9.6 Subgoal 6: Value Optimization .................................................... 452
32.10 Models of PPM .......................................................................................... 453
32.11 The Hybrid Model ...................................................................................... 454
32.12 Efficient Frontier ........................................................................................ 454
32.12.1 Project Assessment ....................................................................... 454
32.13 Keys to Implementing PPM ....................................................................... 456
32.14 PPM Principles ........................................................................................... 456
32.15 Finding the Approach that Fits .................................................................. 457
32.16 Executive Support ...................................................................................... 457
32.17 Governance Framework ............................................................................. 457
32.18 Value-Measurement Framework ................................................................ 458
32.19 Institute Effective Processes ...................................................................... 459
32.20 PPM Implementation Roadmap ................................................................. 459
32.21 External Expertise ..................................................................................... 460
32.22 Implementation Goals ................................................................................ 460
32.23 Key PPM Interfaces ................................................................................... 460
32.24 PPM Implementation Challenges ............................................................... 461
32.25 Advantages of Implementing PPM ............................................................ 461
32.26 Summary .................................................................................................... 462
References ............................................................................................................ 462
Chapter 33 Enterprise Project Management Office ................................................................ 465
33.1 Introduction ................................................................................................ 465
33.2 PMO Functions .......................................................................................... 465
33.3 Enterprise Project Management Office ...................................................... 466
33.4 Communication .......................................................................................... 467
33.5 Performance Metrics .................................................................................. 467
33.6 Status Reporting ......................................................................................... 468
33.7 EPMO Communication Linkages .............................................................. 469
33.8 EPMO Organizational Models .................................................................. 469
33.8.1 Weatherstation ............................................................................ 470
33.8.1.1 Organization Driver ...................................................... 470
33.8.1.2 Formal Authority .......................................................... 470
33.8.2 Control Tower ............................................................................... 471
33.8.2.1 Organization Driver ...................................................... 471
33.8.2.2 Formal Authority .......................................................... 471
33.8.3 Resource Pool ............................................................................... 472
33.8.3.1 Organizational Driver ................................................... 472
33.8.3.2 Formal Authority .......................................................... 472
33.8.4 Which Model Is the Right One? ................................................... 473
33.9 EPMO Maturation Stages .......................................................................... 474
33.9.1 EPMO Tools and Technology ....................................................... 475
33.10 Evaluating and Prioritizing New Projects .................................................. 477
33.11 Weighted Criteria Example ........................................................................ 47"
33.12 Summary .................................................................................................... 47S
References ............................................................................................................ 479
Chapter 34 HR Outsourcing ................................................................................................... 481
34.1 Introduction ................................................................................................ 481
34.2 Management Drivers .................................................................................. 482
34.3 First Wave Outsourcing ............................................................................. 483
34.4 Offshoring Wave ........................................................................................ 483
34.5 Issues with Outsourcing Relationships ...................................................... 483
34.6 Outsourcing Success and Failures ............................................................. 484
34.7 Best Outsourcing Practices ........................................................................ 485
34.8 Outsourcing Vendor Evaluation Worksheet ............................................... 487
34.9 Conclusion .................................................................................................. 489
References ............................................................................................................ 489
Chapter 35 High Productivity Teams ...................................................................................... 491
35.1 Background and Overview ........................................................................ 491
35.2 Introduction to TSP Concepts .................................................................... 492
35.3 PP Concepts ............................................................................................... 492
35.3.1 PP Example .................................................................................. 493
35.3.2 Introducing PP to the Team .......................................................... 495
35.4 TP Process ................................................................................................. 495
35.5 TP Work Objects and Principles ................................................................ 496
35.5.1 TP Launch Structure .................................................................... 496
35.6 TP Launch Details ..................................................................................... 498
35.7 Teamwork Process ..................................................................................... 499
35.8 Quality Management ................................................................................. 499
35.9 Experience Examples and Evaluation ........................................................ 500
35.10 TSP Qualitative Feedback Results ............................................................. 501
35.11 Future Trends ............................................................................................. 502
35.12 Large, Multidisciplined Projects ................................................................ 502
35.13 Summary .................................................................................................... 503
References ............................................................................................................. 503
Chapter 36 Project Governance .............................................................................................. 505
36.1 Introduction ................................................................................................ 505
36.2 Need for Project Governance ..................................................................... 505
36.3 Project Governance Definition ................................................................... 506
36.4 Organizational Level Project Governance Principles ................................ 507
36.5 Tactical Level Project Governance ............................................................ 508
36.6 Operational Governance Model ................................................................. 509
36.7 Defining Responsibilities ........................................................................... 510
36.8 Populating the Project Governance Framework ........................................ 512
36.9 Governance Life Cycle Maturity Model .................................................... 514
36.10 Governance Value Process ......................................................................... 514
36.11 Corporate Governance and Project Teamwork (Halas) ............................. 516
36.12 Commentary .............................................................................................. 518
36.13 Conclusion ...........;...................................................................................... 518
References ............................................................................................................ 519
PART X Professional Ethics and Responsibility
Chapter 37 Ethical Project Management Practices ................................................................. 523
37.1 Learning Objectives ................................................................................... 523
37.2 Introduction ................................................................................................ 523
37.3 PMI's Code of Professional Conduct ......................................................... 526
Review Questions ................................................................................................. 526
Reference .............................................................................................................. 529
Appendix A Financial Metrics .................................................................................................. 531
Appendix B Templates .............................................................................................................. 539
Appendix C Project Repository Architecture ........................................................................... 541
Index .......................................................................................................................................... 545