Discussion Question
What is Project Management? by Merrie Barron and Andrew R. Barron is available under a Creative
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What is Project Management?
Merrie Barron, PMP, CSM Andrew R. Barron
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You've determined that you have a pro ject. What now? The notes you scribbled down on the back of
the napkin at lunch are a start, but not exactly good pro ject management practice. Too often, organizations
follow Nike's advice when it comes to managing pro jects when they just do it. An assignment is made
and the pro ject team members jump directly into the development of the product or service requested. In
the end the delivered product doesn't meet the expectations of the customer. Unfortunately, many pro jects
follow this poorly constructed path and that is a primary contributor to why a large percentage of pro jects
don't meet their original ob jectives dened by performance, schedule, and budget. In the United States, more than $250 billion dollars is spent each year on IT application development
in approximately 175,000 pro jects. The Standish Group (a Boston-based leader in pro ject and value perfor-
mance research) just released the summary version of their 2009 CHAOS Report that tracks pro ject failure
rates across a broad range of companies and industries (Figure 1). Figure 1:
Summary of 2009 Standish Group CHAOS report. Jim Johnson, chairman of the Standish Group has stated that this year's results show a marked decrease
in pro ject success rates, with 32% of all pro jects succeeding which are delivered on time, on budget, with
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required features and functions, 44% were challenged which are late, over budget, and/or with less than
the required features and functions and 24% failed which are cancelled prior to completion or delivered and
never used. When are companies going to stop wasting billions of dollars on failed pro jects? The vast ma jority of this
waste is completely avoidable; simply get the right business needs (requirements) understood early in the
process and ensure that pro ject management techniques are applied and followed and the pro ject activities
are monitored.
Applying good pro ject management discipline is the way to help reduce the risks. But keep in mind,
having good pro ject management skills does not mean you have no problems, it does not mean that risks go
away, or that there won't be any surprises. The value of good pro ject management is that you have standard
processes in place to deal with all contingencies. Pro ject Management is the application of knowledge, skills, tools, and techniques applied to pro ject
activities in order to meet the pro ject requirements. Pro ject management is a process that includes planning,
putting the pro ject plan into action, and measuring progress and performance. Managing a pro ject includes identifying your pro ject's requirements; writing down what everyone needs
from the pro ject. What are the ob jectives for your pro ject? When everyone understands the goal, it's much
easier to keep them all on the right path. Make sure you set goals that everyone agrees on to avoid team
conicts later on. Understanding and addressing the needs of everyone aected by the pro ject means the
end result of your pro ject is far more likely to satisfy your stakeholders, and last but not least, as pro ject
manager you will also be balancing the many competing pro ject constraints. On any pro ject, you will have a number of competing pro ject constraints that are competing for your
attention. They are cost, scope, quality, risk, resources and time.
Cost is budget approved for the pro ject including all necessary expenses needed to deliver the pro ject.
Within organizations, pro ject managers have to balance between not running out of money and not
under spending because many pro jects receive funds or grants that have contract clauses with an use
it or lose it approach to pro ject funds. Poorly executed budget plans can result in a last minute rush
to spend the allocated funds. For virtually all pro jects, cost is ultimately a limiting constraint; few
pro jects can go over budget without eventually requiring a corrective action.
Scope is what the pro ject is trying to achieve, it entails all the work involved in delivering the pro jects
outcomes and the processes used to produce them. It is the reason and the purpose of the pro ject.
Quality is the standards and criteria to which the pro ject's products must be delivered for them to
perform eectively. First, the product must perform to provide the functionality expected, and to solve
the problem, and deliver the benet and value expected of it. It must also meet other performance
requirements, or service levels, such as availability, reliability and maintainability, and have acceptable
nish and polish. Quality on a pro ject is controlled through quality assurance (QA) that is the process
of evaluating overall pro ject's performance on a regular basis to provide condence that the pro ject
will satisfy the relevant quality standards.
Risk is dened by potential external events that will have a negative impact on your pro ject if they
occur. Risk refers to the combination of the probability the event will occur and the impact on the
pro ject if the event occurs. If the combination of the probability of the occurrence and the impact to
the pro ject is too high, you should identify the potential event as a risk and put a proactive plan in
place to manage the risk.
Resources are required to carry out the pro ject tasks. They can be people, equipment, facilities,
funding, or anything else capable of denition (usually other than labor) required for the completion
of a pro ject activity.
Time is dened as the time to complete the pro ject. Time is often the most frequent pro ject oversight
in developing pro jects. This is reected in missed deadlines and incomplete deliverables. Proper control
of the schedule requires the careful identication of tasks to be performed, an accurate estimation of
their durations, the sequence in which they are going to be done, and how people and other resources
are allocated.
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You may have heard of the term Triple Constraint which traditionally only consisted of Time,Cost&
Scope. These are the primary competing pro ject constraints that you have to be aware of most. The triple
constraint is illustrated in the form of a triangle to visualize the pro ject work and to see the relationship
between the scope/quality, schedule/time, and cost/resource (Figure 2). Figure 2:
A schematic of the triple constraint triangle. In this triangle, each side represents one of the constraints (or related constraints) wherein any changes
to any one side cause a change in the other sides. The best pro jects have a perfectly balanced triangle.
Maintaining this balance is dicult because pro jects are prone to change. For example, if scope increases,
cost and time may increase disproportionately. Alternatively, if the amount of money you have for your
pro ject decreases, you may be able to do as much, but your time may increase. Your pro ject may have additional constraints that you are facing, and as the pro ject manager you have to
balance the needs of these constraints against the needs of the stakeholders and against your pro ject goals.
For instance, if your sponsor wants to add functionality to the original scope you will very likely need more
money to nish the pro ject or if they cut the budget you have to reduce the quality of your scope and if
you don't get the appropriate resources to work on your pro ject tasks you will have to extend your schedule
because the resources you have take much longer to nish the work. You get the idea; they are all dependent on each other. Think of all of these constraints as the classic
carnival game of Whac-a-mole (Figure 3). Each time you try to push one mole back in the hole, another one
pops out. The best advice is to rely on your pro ject team to keep these moles in place!
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Go to www.dorneypark.com/public/online_fun/mole.cfm to play Whac-a-mole. Here is an example of a pro ject that cut
qualitybecause the pro ject costswere xed. The P-36 oil
platform (Figure 4) was the largest oating production platform in the world capable of processing 180,000
barrels of oil per day and 7.2 million cubic meters of gas per day. Located in the Roncador Field, Campos
Basin, Brazil the P-36 was operated by Petrobras. Figure 4:
The Petrobras P-36 oil platform. In March 2001, the P-36 was producing around 84,000 barrels of oil and 1.3 million cubic meters of gas
per day when it became destabilized by two explosions and subsequently sank in 3900 feet of water with
1650 short tons of crude oil remaining on board, killing 11 people. The sinking is attributed to a complete failure in quality assurance and pressure for increased production
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led to corners being cut on safety procedures. It is listed as one of the most expensive accidents with a price
tag of $515,000,000. The following quote is from a Petrobras executive, citing the benets of cutting quality assurance and
inspection costs on the pro ject, while the accompanying pictures are the result of this proud achievement in
pro ject management by Petrobras. Figure 5:
"Petrobras has established new global benchmarks for the generation of exceptional share-
holder wealth through an aggressive and innovative program of cost cutting on its P36 production facility." Figure 6:
"Conventional constraints have been successfully challenged and replaced with new paradigms
appropriate to the globalized corporate market place." http://cnx.org/content/m31508/1.4/
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"Through an integrated network of facilitated workshops, the pro ject successfully rejected the
established constricting and negative inuences of prescriptive engineering, onerous quality requirements,
and outdated concepts of inspection and client control." Figure 8:
"Elimination of these unnecessary straitjackets has empowered the pro ject's suppliers and
contractors to propose highly economical solutions, with the win-win bonus of enhanced protability
margins for themselves." http://cnx.org/content/m31508/1.4/
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"The P36 platform shows the shape of things to come in the unregulated global market
economy of the 21 st
century." The dynamic trade-os between the pro ject constraint values has been humorously but accurately de-
scribed in Figure 10. Figure 10:
A sign seen at an automotive repair shop. 1 Bibliography
CHAOS 2009 Summary and EPPM Study , The Standish Group, Boston, MA (2009).
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