Case study 13.1 the it department at kimble college

Why do so many projects end up terminated as a result of termination through starvation? Discuss the role of ego, power, and politics in this form of project termination

Contemporary Project Management

Timothy J. Kloppenborg

Vittal Anantatmula

Kathryn N. Wells

F O U R T H E D I T I O N

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MS Project 2016 Instructions in Contemporary Project Management 4e

Chapter MS Project

3 MS Project 2016 Introduction Ribbon, Quick Access Toolbar, view panes, Zoom Slider, Shortcuts, Scheduling Mode Selector

Setting Up Your First Project Auto schedule, start date, identifying information, summary row

Create Milestone Schedule Key milestones, zero duration, must finish on, information

7 Set Up a Work Breakdown Structure (WBS) Understand the WBS definitions and displays Enter WBS Elements (tasks), Create the outline, Insert WBS Code Identifier column, Hide or show subtasks detail

8 Using MS Project for Critical Path Schedules Set Up the Project Schedule

Set or update the project start date, Define organization’s working and nonworking time Build the Network Diagram and Identify the Critical Path

Enter tasks and milestones, edit the timescale, understand and define task dependencies, assign task duration estimates, identify the critical path, understand the network diagram view

Display and Print Schedules

9 Define Resources Resource views, max units, resource calendars

Assigning Resources Basic assignment, modify an assignment

Identify Overallocated Resources Resource usage and Detailed Gantt views together

Overallocated Resources Finding overallocated resources, dealing with overallocations

Crashing a Critical Path Activity

10 Develop Bottom-up Project Budget Assignment costs, task costs, various cost perspectives

Develop Summary Project Budget

12 Baseline the Project Plan First time baseline, subsequent baselines, viewing variances

14 Using MS Project to Monitor and Control Projects What Makes a Schedule Useful? How MS Project recalculates based on reported actuals, current and future impacts of variances, define the performance update process (who, what, when) Steps to Update the Project Schedule

Acquire performance data, set and display status date, Enter duration-based performance data, reschedule remaining work, revise future estimates

15 Close Project Creating project progress reports, sharing reports, export a report to MS Excel, archive project work, capture and publish lessons learned

Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.

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PMBOK® Guide 6e Coverage in Contemporary Project Management 4e The numbers refer to the text page where the process is defined. Project management (PM) processes and knowledge areas 10–11 Project life cycle 7–10, 62–64 Projects and strategic planning 33–37 Organizational influences 102–110 Portfolio and program management 37–42

PMBOK® Guide, 6th ed. Coverage

Knowledge Areas

Initiating Process Group Planning Process Group

Executing Process Group

Monitoring & Controlling Process Group

Closing Process Group

Project Integration Management

Develop Project Charter 60–79

Develop Project Management Plan 409–410

Direct and Manage Project Work 459–460 Manage Project Knowledge 192–193, 504–508

Monitor and Control Project Work 460–462 Perform Integrated Change Control 229–232, 462–463

Close Project or Phase 503, 508–511

Project Scope Management

Plan Scope Management 211–212 Collect Requirements 212–216 Define Scope 216–220 Create WBS 220–229

Validate Scope 500–501 Control Scope 475–476

Project Schedule Management

Plan Schedule Management 246 Define Activities 249–253 Sequence Activities 253–255 Estimate Activity Durations 255–258 Develop Schedule 259–267

Control Schedule 476–480

Project Cost Management

Plan Cost Management 329–330 Estimate Costs 330–341 Determine Budget 342–344

Control Costs 345, 476–480

Project Quality Management

Plan Quality Management 401–404 Manage Quality 404–406, 469–474

Control Quality 406–409, 469–474

Project Resources Management

Plan Resource Management 290–295 Estimate Activity Resources 290

Aquire Resources 138–141 Develop Team 141–157 Manage Team 157–161

Control Resources 476

Project Com- munications Management

Plan Communications Management 188–192

Manage Communications 193–199, 465–467

Monitor Communications 467–468

Project Risk Management

Plan Risk Management 360–366 Identify Risks 75, 366–368 Perform Qualitative Risk Analysis 75, 368–372 Perform Quantitative Risk Analysis 372–373 Plan Risk Responses 75, 373–377

Implement Risk Responses 464–465

Monitor Risks 463–464

Project Procurement Management

Plan Procurement Management 431–433, 438–441

Conduct Procurements 434–438

Control Procurments 441

Project Stake- holder Management

Identify Stakehold- ers 75–77, 178–184

Plan Stakeholder Engagement 184–186 Manage Stakeholder Engagement 187–188

Monitor Stakeholder Engagement 188

Source: Adapted from A Guide to the Project Management Body of Knowledge (PMBOK® Guide), 6th ed. (Newtown Square, PA: Project Management Institute, Inc., 2017): 31.

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Contemporary Project Management ORGANIZE LEAD PLAN PERFORM

FOURTH EDITION

TIMOTHY J. KLOPPENBORG Xavier University

VITTAL ANANTATMULA Western Carolina University

KATHRYN N. WELLS Keller Williams Real Estate

Australia • Brazil • Mexico • Singapore • United Kingdom • United States

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This is an electronic version of the print textbook. Due to electronic rights restrictions, some third party content may be suppressed. Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. The publisher reserves the right to remove content from this title at any time if subsequent rights restrictions require it. For valuable information on pricing, previous editions, changes to current editions, and alternate formats, please visit www.cengage.com/highered to search by ISBN#, author, title, or keyword for materials in your areas of interest.

Important Notice: Media content referenced within the product description or the product text may not be available in the eBook version.

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Contemporary Project Management, Fourth Edition

Timothy J. Kloppenborg

2019 2015

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Printed in the United States of America Print Number: 01 Print Year: 2017

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MS Project 2016 Instructions in Contemporary Project Management 4e

Chapter MS Project

3 MS Project 2016 Introduction Ribbon, Quick Access Toolbar, view panes, Zoom Slider, Shortcuts, Scheduling Mode Selector

Setting Up Your First Project Auto schedule, start date, identifying information, summary row

Create Milestone Schedule Key milestones, zero duration, must finish on, information

7 Set Up a Work Breakdown Structure (WBS) Understand the WBS definitions and displays Enter WBS Elements (tasks), Create the outline, Insert WBS Code Identifier column, Hide or show subtasks detail

8 Using MS Project for Critical Path Schedules Set Up the Project Schedule

Set or update the project start date, Define organization’s working and nonworking time Build the Network Diagram and Identify the Critical Path

Enter tasks and milestones, edit the timescale, understand and define task dependencies, assign task duration estimates, identify the critical path, understand the network diagram view

Display and Print Schedules

9 Define Resources Resource views, max units, resource calendars

Assigning Resources Basic assignment, modify an assignment

Identify Overallocated Resources Resource usage and Detailed Gantt views together

Overallocated Resources Finding overallocated resources, dealing with overallocations

Crashing a Critical Path Activity

10 Develop Bottom-up Project Budget Assignment costs, task costs, various cost perspectives

Develop Summary Project Budget

12 Baseline the Project Plan First time baseline, subsequent baselines, viewing variances

14 Using MS Project to Monitor and Control Projects What Makes a Schedule Useful? How MS Project recalculates based on reported actuals, current and future impacts of variances, define the performance update process (who, what, when) Steps to Update the Project Schedule

Acquire performance data, set and display status date, Enter duration-based performance data, reschedule remaining work, revise future estimates

15 Close Project Creating project progress reports, sharing reports, export a report to MS Excel, archive project work, capture and publish lessons learned

Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.

Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203

PMBOK® Guide 6e Coverage in Contemporary Project Management 4e The numbers refer to the text page where the process is defined. Project management (PM) processes and knowledge areas 10–11 Project life cycle 7–10, 62–64 Projects and strategic planning 33–37 Organizational influences 102–110 Portfolio and program management 37–42

PMBOK® Guide, 6th ed. Coverage

Knowledge Areas

Initiating Process Group Planning Process Group

Executing Process Group

Monitoring & Controlling Process Group

Closing Process Group

Project Integration Management

Develop Project Charter 60–79

Develop Project Management Plan 409–410

Direct and Manage Project Work 459–460 Manage Project Knowledge 192–193, 504–508

Monitor and Control Project Work 460–462 Perform Integrated Change Control 229–232, 462–463

Close Project or Phase 503, 508–511

Project Scope Management

Plan Scope Management 211–212 Collect Requirements 212–216 Define Scope 216–220 Create WBS 220–229

Validate Scope 500–501 Control Scope 475–476

Project Schedule Management

Plan Schedule Management 246 Define Activities 249–253 Sequence Activities 253–255 Estimate Activity Durations 255–258 Develop Schedule 259–267

Control Schedule 476–480

Project Cost Management

Plan Cost Management 329–330 Estimate Costs 330–341 Determine Budget 342–344

Control Costs 345, 476–480

Project Quality Management

Plan Quality Management 401–404 Manage Quality 404–406, 469–474

Control Quality 406–409, 469–474

Project Resources Management

Plan Resource Management 290–295 Estimate Activity Resources 290

Aquire Resources 138–141 Develop Team 141–157 Manage Team 157–161

Control Resources 476

Project Com- munications Management

Plan Communications Management 188–192

Manage Communications 193–199, 465–467

Monitor Communications 467–468

Project Risk Management

Plan Risk Management 360–366 Identify Risks 75, 366–368 Perform Qualitative Risk Analysis 75, 368–372 Perform Quantitative Risk Analysis 372–373 Plan Risk Responses 75, 373–377

Implement Risk Responses 464–465

Monitor Risks 463–464

Project Procurement Management

Plan Procurement Management 431–433, 438–441

Conduct Procurements 434–438

Control Procurments 441

Project Stake- holder Management

Identify Stakehold- ers 75–77, 178–184

Plan Stakeholder Engagement 184–186 Manage Stakeholder Engagement 187–188

Monitor Stakeholder Engagement 188

Source: Adapted from A Guide to the Project Management Body of Knowledge (PMBOK® Guide), 6th ed. (Newtown Square, PA: Project Management Institute, Inc., 2017): 31.

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Brief Contents

Preface xx About the Authors xxix

PART 1 Organizing Projects 1 Introduction to Project Management 2

2 Project Selection and Prioritization 32

3 Chartering Projects 60

PART 2 Leading Projects 4 Organizational Capability: Structure, Culture, and Roles 100

5 Leading and Managing Project Teams 136

6 Stakeholder Analysis and Communication Planning 176

PART 3 Planning Projects 7 Scope Planning 210

8 Scheduling Projects 244

9 Resourcing Projects 286

10 Budgeting Projects 328

11 Project Risk Planning 358

12 Project Quality Planning and Project Kickoff 386

PART 4 Performing Projects 13 Project Supply Chain Management 426

14 Determining Project Progress and Results 456

15 Finishing the Project and Realizing the Benefits 498

Appendix A PMP and CAPM Exam Prep Suggestions 522 Appendix B Agile Differences Covered 527 Appendix C Answers to Selected Exercises 532 Appendix D Project Deliverables 537 Appendix E Strengths Themes As Used in Project Management [Available Online]

Index 539

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Requirements Documents

13.1 Identify Stakeholders

Stakeholder Register

Stakeholder Engagement

Assessment Matrix

Integration

Scope

Schedule

Cost

Quality

Resources

Communication

Risk

Procurement

Stakeholders

12.1 Plan Procurement Management

11.1 Plan Risk

Management

10.1 Plan Communications

Management

9.1 Plan Resource

Management

8.1 Plan Quality

Management

7.1 Plan Cost

Management

6.1 Plan Schedule

Management

5.1 Plan Scope

Management

Duration Estimates

Scope Statement

Activity List Milestone List

Network

4.1 Develop Project Charter

Charter Assumptions Log

Cost Baseline

Resource Requirements

RACI Team

Charter

Quality Mgt. Plan

Communications Matrix

Risk Register

Bid Documents Make or Buy

Analysis

6.5 Develop Schedule

Schedule Baseline

5.2 Collect Requirements

5.4 Create WBS

Scope

4.2 Develop Project Management Plan

Activities

9.2 Estimate Activity

Resources

11.2 Identify Risks

11.3 Perform Qualitative

Risk Analysis

11.4 Perform Quantitative Risk Analysis

11.5 Plan Risk

Responses

13.2 Plan Stakeholders Engagement

6.4 Estimate activity

Durations

7.3 Determine Budget

7.2 Estimate Costs

6.3 Sequence Activities

1.2 Foundational Elements

2.4 Organizational Systems

3.4 Project Manager Competencies Selecting Projects

Project Customer Tradeoff Matrix

Life Cycle and Development Approach Elevator Pitch

Leader Roles and Responsibilities Project Selection and Prioritization Matrix Project Resource Assignment Matrix

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11.6 Implement Risk Responses

13.3 Manage Stakeholder Engagement

13.4 Monitor Stakeholder Engagement

4.3 Direct and Manage Project Work

4.4 Manage Project Knowledge

Scope Baseline with WBS

Resource Histogram Project Crashing

Retrospectives

Closure Documents Customer Feedback Transition Plan

Scope Backlog

Burn Down/Up

Charts

Quality Reports

s Analysis

Realizing s

PM Plan Baselines Life Cycle and Development Approach 4.7 Close Project

or Phase

6.6 Control Schedule

Earned Value Analysis

7.4 Control Costs

5.6 Control Scope

5.5 Validate Scope

8.2 Manage Quality

9.3 Acquire Resources

9.4 Develop Team

9.6 Control Resources

9.5 Manage Team

8.3 Control Quality

Change Requests

10.2 Manage Communications

11.7 Monitor Risks

10.3 Monitor Communications

Team Assignments

Team Assessments

Agendas Minutes

Issues Log Meeting Evaluation Progress Report

12.2 Conduct Procurements

12.3 Control Procurements

Source Selection

Matrix

Lessons Learned Register

Quality Measurements

4.6 Perform Integrated

Change Control

4.5 Monitor and Control

Project Work

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Contents

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xx About the Authors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxix

PART 1 Organizing Projects

CHAPTER 1 Introduction to Project Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1.1 What Is a Project? 3 1.2 History of Project Management 5 1.3 How Can Project Work Be Described? 6

1.3a Projects versus Operations 6 / 1.3b Soft Skills and Hard Skills 7 / 1.3c Authority and Responsibility 7 / 1.3d Project Life Cycle 7

1.4 Understanding Projects 10 1.4a Project Management Institute 10 / 1.4b Project Management Body of Knowledge

(PMBOK®) 10 / 1.4c The PMI Talent Triangle 11 / 1.4d Selecting and Prioritizing Projects 14 / 1.4e Project Goals and Constraints 14 / 1.4f Defining Project Success and Failure 15 / 1.4g Using Microsoft Project to Help Plan and Measure Projects 16 / 1.4h Types of Projects 16 / 1.4i Scalability of Project Tools 17

1.5 Project Roles 17 1.5a Project Executive-Level Roles 18 / 1.5b Project Management-Level Roles 19 /

1.5c Project Associate-Level Roles 20 1.6 Overview of the Book 20

1.6a Part 1: Organizing and Initiating Projects 20 / 1.6b Part 2: Leading Projects 21 / 1.6c Part 3: Planning Projects 21 / 1.6d Part 4: Performing Projects 23

PMP/CAPM Study Ideas 23 Summary 24 Key Terms Consistent with PMI Standards and Guides 24 Chapter Review Questions 25 Discussion Questions 25 PMBOK® Guide Questions 26 Integrated Example Projects 27 Suburban Homes Construction Project 27 Casa DE PAZ Development Project 28 Semester Project Instructions 28 Project Management in Action 29 References 30 Endnotes 31

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CHAPTER 2 Project Selection and Prioritization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 2.1 Strategic Planning Process 33

2.1a Strategic Analysis 33 / 2.1b Guiding Principles 34 / 2.1c Strategic Objectives 36 / 2.1d Flow-Down Objectives 37

2.2 Portfolio Management 37 2.2a Portfolios 38 / 2.2b Programs 39 / 2.2c Projects and Subprojects 39 /

2.2d Assessing an Organization’s Ability to Perform Projects 42 / 2.2e Identifying Potential Projects 42 / 2.2f Using a Cost-Benefit Analysis Model to Select Projects 43 / 2.2g Using a Scoring Model to Select Projects 45 / 2.2h Prioritizing Projects 48 / 2.2i Resourcing Projects 48

2.3 Securing Projects 49 2.3a Identify Potential Project Opportunities 50 / 2.3b Determine Which Opportunities to

Pursue 50 / 2.3c Prepare and Submit a Project Proposal 51 / 2.3d Negotiate to Secure the Project 51

PMP/CAPM Study Ideas 52 Summary 52 Key Terms Consistent with PMI Standards and Guides 52 Chapter Review Questions 53 Discussion Questions 53 PMBOK® Guide Questions 53 Exercises 54 Integrated Example Projects 55 Casa DE PAZ Development Project 56 Semester Project Instructions 56 Project Management in Action 57 References 58 Endnotes 59

CHAPTER 3 Chartering Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 3.1 What Is a Project Charter? 62 3.2 Why Is a Project Charter Used? 63 3.3 When Is a Charter Needed? 64 3.4 Typical Elements in a Project Charter 65

3.4a Title 65 / 3.4b Scope Overview 65 / 3.4c Business Case 66 / 3.4d Background 66 / 3.4e Milestone Schedule with Acceptance Criteria 66 / 3.4f Risks, Assumptions, and Constraints 67 / 3.4g Resource Estimates 69 / 3.4h Stakeholder List 69 / 3.4i Team Operating Principles 69 / 3.4j Lessons Learned 70 / 3.4k Signatures and Commitment 70

3.5 Constructing a Project Charter 70 3.5a Scope Overview and Business Case Instructions 70 / 3.5b Background

Instructions 71 / 3.5c Milestone Schedule with Acceptance Criteria Instructions 72 / 3.5d Risks, Assumptions, and Constraints Instructions 75 / 3.5e Resources Needed Instructions 75 / 3.5f Stakeholder List Instructions 75 /

Contents ix

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3.5g Team Operating Principles Instructions 77 / 3.5h Lessons Learned Instructions 77 / 3.5i Signatures and Commitment Instructions 78

3.6 Ratifying the Project Charter 79 3.7 Starting a Project Using Microsoft Project 79

3.7a MS Project 2016 Introduction 80 / 3.7b Setting up Your First Project 81 / 3.7c Define Your Project 82 / 3.7d Create a Milestone Schedule 83

PMP/CAPM Study Ideas 88 Summary 88 Key Terms Consistent with PMI Standards and Guides 88 Chapter Review Questions 89 Discussion Questions 89 PMBOK® Guide Questions 89 Exercises 90 Integrated Example Projects 91 Casa DE PAZ Development Project 93 Semester Project Instructions 93 Project Management in Action 93 References 96 Endnotes 97

PART 2 Leading Projects

CHAPTER 4 Organizational Capability: Structure, Culture, and Roles . . . . . . . . . . . . . . . . . . . . . 100 4.1 Types of Organizational Structures 103

4.1a Functional 103 / 4.1b Projectized 104 / 4.1c Matrix 105 4.2 Organizational Culture and Its Impact on Projects 109

4.2a Culture of the Parent Organization 110 / 4.2b Project Cultural Norms 111 4.3 Project Life Cycles 111

4.3a Define-Measure-Analyze-Improve-Control (DMAIC) Model 112 / 4.3b Research and Development (R&D) Project Life Cycle Model 113 / 4.3c Construction Project Life Cycle Model 113 / 4.3d Agile Project Life Cycle Model 113

4.4 Agile Project Management 114 4.4a What Is Agile? 114 / 4.4b Why Use Agile? 114 / 4.4c What Is an Agile

Mindset? 114 / 4.4d What Are the Key Roles in Agile Projects? 115 / 4.4e How Do You Start an Agile Project? 115 / 4.4f How Do You Continue an Agile Project? 115 / 4.4g What Is Needed for Agile to Be Successful? 116

4.5 Traditional Project Executive Roles 116 4.5a Steering Team 116 / 4.5b Sponsor 117 / 4.5c Customer 119 / 4.5d Chief

Projects Officer/Project Management Office 121 4.6 Traditional Project Management Roles 121

4.6a Functional Manager 121 / 4.6b Project Manager 122 / 4.6c Facilitator 124 4.7 Traditional Project Team Roles 126

4.7a Core Team Members 126 / 4.7b Subject Matter Experts 126

x Contents

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4.8 Role Differences on Agile Projects 126 PMP/CAPM Study Ideas 128 Summary 128 Key Terms Consistent with PMI Standards and Guides 128 Chapter Review Questions 129 Discussion Questions 129 PMBOK® Guide Questions 129 Exercises 130 Integrated Example Projects 130 Casa DE PAZ Development Project 131 Semester Project Instructions 131 Project Management in Action 132 References 134 Endnotes 135

CHAPTER 5 Leading and Managing Project Teams . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 5.1 Acquire Project Team 138

5.1a Preassignment of Project Team Members 139 / 5.1b Negotiation for Project Team Members 139 / 5.1c On-Boarding Project Team Members 140

5.2 Develop Project Team 141 5.2a Stages of Project Team Development 142 / 5.2b Characteristics of High-Performing

Project Teams 144 / 5.2c Assessing Individual Member Capability 147 / 5.2d Assessing Project Team Capability 148 / 5.2e Building Individual and Project Team Capability 150 / 5.2f Establishing Project Team Ground Rules 153

5.3 Manage Project Team 157 5.3a Project Manager Power and Leadership 157 / 5.3b Assessing Performance of

Individuals and Project Teams 159 / 5.3c Project Team Management Outcomes 159 5.4 Relationship Building Within the Core Team 160 5.5 Managing Project Conflicts 161

5.5a Sources of Project Conflict 162 / 5.5b Conflict-Resolution Process and Styles 163 / 5.5c Negotiation 164

5.6 Communication Needs of Global and Virtual Teams 166 5.6a Virtual Teams 166 / 5.6b Cultural Differences 166 / 5.6c Countries and Project

Communication Preferences 167 PMP/CAPM Study Ideas 167 Summary 168 Key Terms Consistent with PMI Standards and Guides 168 Chapter Review Questions 168 Discussion Questions 169 PMBOK® Guide Questions 170 Integrated Example Projects 170 Casa DE PAZ Development Project 171 Semester Project Instructions 171

Contents xi

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Project Management in Action 172 References 174 Endnotes 175

CHAPTER 6 Stakeholder Analysis and Communication Planning . . . . . . . . . . . . . . . . . . . . . . . . . 176 6.1 Identify Stakeholders 178

6.1a Find Stakeholders 179 / 6.1b Analyze Stakeholders 180 / 6.1c Document Stakeholders 183

6.2 Plan Stakeholder Engagement 184 6.2a Creating a Stakeholder Engagement Assessment Matrix 184 / 6.2b Planning to Build

Relationships with Stakeholders 185 6.3 Manage Stakeholder Engagement 187 6.4 Monitor Stakeholder Engagement 188 6.5 Plan Communications Management 188

6.5a Purposes of a Project Communications Plan 188 / 6.5b Communications Plan Considerations 189 / 6.5c Communications Matrix 191 / 6.5d Manage Project Knowledge 192

6.6 Manage Communications 193 6.6a Determine Project Information Needs 193 / 6.6b Establish Information Retrieval and

Distribution System 193 / 6.6c Project Meeting Management 194 / 6.6d Issues Management 197

PMP/CAPM Study Ideas 199 Summary 199 Key Terms Consistent with PMI Standards and Guides 200 Chapter Review Questions 200 Discussion Questions 200 PMBOK® Guide Questions 201 Integrated Example Projects 202 Casa DE PAZ Development Project 202 Semester Project Instructions 203 Project Management in Action 204 References 206 Endnotes 207

PART 3 Planning Projects

CHAPTER 7 Scope Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 210 7.1 Plan Scope Management 211 7.2 Collect Requirements 212

7.2a Gather Stakeholder Input and Needs 213 7.3 Define Scope 217

7.3a Reasons to Define Scope 217 / 7.3b How to Define Scope 217 / 7.3c Defining Scope in Agile Projects 218

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7.4 Work Breakdown Structure (WBS) 220 7.4a What Is the WBS? 220 / 7.4b Why Use a WBS? 221 / 7.4c WBS

Formats 222 / 7.4d Work Packages 224 / 7.4e How to Construct a WBS 226 7.5 Establish Change Control 229 7.6 Using MS Project for Work Breakdown Structures (WBS) 232

7.6a Set Up a WBS in MS Project 232 PMP/CAPM Study Ideas 237 Summary 239 Key Terms Consistent with PMI Standards and Guides 239 Chapter Review Questions 239 Discussion Questions 239 PMBOK® Guide Questions 240 Exercises 241 Integrated Example Projects 241 Casa DE PAZ Development Project 242 Semester Project Instructions 242 Project Management in Action 242 References 243

CHAPTER 8 Scheduling Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 244 8.1 Plan Schedule Management 246 8.2 Purposes of a Project Schedule 247 8.3 Historical Development of Project Schedules 247 8.4 How Project Schedules Are Limited and Created 248 8.5 Define Activities 249 8.6 Sequence Activities 253

8.6a Leads and Lags 254 / 8.6b Alternative Dependencies 255 8.7 Estimate Activity Duration 255

8.7a Problems and Remedies in Duration Estimating 256 / 8.7b Learning Curves 258 8.8 Develop Project Schedules 259

8.8a Two-Pass Method 259 / 8.8b Enumeration Method 263 8.9 Uncertainty in Project Schedules 264

8.9a Program Evaluation and Review Technique 265 / 8.9b Monte Carlo Simulation 266 8.10 Show the Project Schedule on a Gantt Chart 268 8.11 Using Microsoft Project for Critical Path Schedules 268

8.11a Set up the Project Schedule 269 / 8.11b Build the Network Diagram and Identify the Critical Path 270

PMP/CAPM Study Ideas 275 Summary 276 Key Terms Consistent with PMI Standards and Guides 276 Chapter Review Questions 277 Discussion Questions 277

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Exercises 278 PMBOK® Guide Questions 280 Integrated Example Projects 281 Casa DE PAZ Development Project 281 Semester Project Instructions 283 Project Management in Action 283 References 284 Endnotes 285

CHAPTER 9 Resourcing Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286 9.1 Abilities Needed When Resourcing Projects 288

9.1a The Science and Art of Resourcing Projects 288 / 9.1b Considerations When Resourcing Projects 288 / 9.1c Activity- versus Resource-Dominated Schedules 289

9.2 Estimate Resource Needs 290 9.3 Plan Resource Management 290

9.3a Identify Potential Resources 291 / 9.3b Determine Resource Availability 293 / 9.3c Decide Timing Issues When Resourcing Projects 294

9.4 Project Team Composition Issues 295 9.4a Cross-Functional Teams 295 / 9.4b Co-Located Teams 295 / 9.4c Virtual

Teams 295 / 9.4d Outsourcing 295 9.5 Assign a Resource to Each Activity 296

9.5a Show Resource Responsibilities on RACI Chart 297 / 9.5b Show Resource Assignments on Gantt Chart 297 / 9.5c Summarize Resource Responsibilities by Time Period with Histogram 297

9.6 Dealing with Resource Overloads 300 9.6a Methods of Resolving Resource Overloads 300

9.7 Compress the Project Schedule 303 9.7a Actions to Reduce the Critical Path 303 / 9.7b Crashing 304 / 9.7c Fast

Tracking 307 9.8 Alternative Scheduling Methods 309

9.8a Critical Chain Project Management (CCPM) 309 / 9.8b Reverse Phase Schedules 310 / 9.8c Rolling Wave Planning 310 / 9.8d Agile Project Planning 310 / 9.8e Auto/Manual Scheduling 310

9.9 Using MS Project for Resource Allocation 311 9.9a Step 1: Defining Resources 311 / 9.9b Step 2: Set Up a Resource Calendar 312 /

9.9c Step 3: Assigning Resources 312 / 9.9d Step 4: Finding Overallocated Resources 315 / 9.9e Step 5: Dealing with Overallocations 316 / 9.9f Crashing a Critical Path Activity 317

PMP/CAPM Study Ideas 319 Summary 319 Key Terms Consistent with PMI Standards and Guides 320 Chapter Review Questions 320 Discussion Questions 320 PMBOK® Guide Questions 321 Exercises 322

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Integrated Example Projects 324 Casa DE PAZ Development Project 324 Semester Project Instructions 325 Project Management in Action 325 References 327 Endnote 327

CHAPTER 10 Budgeting Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 328 10.1 Plan Cost Management 329 10.2 Estimate Cost 330

10.2a Types of Cost 331 / 10.2b Accuracy and Timing of Cost Estimates 334 / 10.2c Methods of Estimating Costs 335 / 10.2d Project Cost Estimating Issues 338

10.3 Determine Budget 342 10.3a Aggregating Costs 342 / 10.3b Analyzing Reserve Needs 342 /

10.3c Determining Cash Flow 344 10.4 Establishing Cost Control 345 10.5 Using MS Project for Project Budgets 345

10.5a Developing a Bottom-Up Project Budget Estimate 345 / 10.5b Develop Summary Project Budget 347

PMP/CAPM Study Ideas 349 Summary 349 Key Terms Consistent with PMI Standards and Guides 350 Chapter Review Questions 350 Discussion Questions 350 PMBOK® Guide Questions 351 Exercises 352 Integrated Example Projects 353 Casa DE PAZ Development Project 354 Semester Project Instructions 354 Project Management in Action 354 References 356 Endnotes 356

CHAPTER 11 Project Risk Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358 11.1 Plan Risk Management 360

11.1a Roles and Responsibilities 362 / 11.1b Categories and Definitions 362 11.2 Identify Risks 366

11.2a Information Gathering 366 / 11.2b Reviews 367 / 11.2c Understanding Relationships 368 / 11.2d Risk Register 368

11.3 Risk Analysis 368 11.3a Perform Qualitative Risk Analysis 368 / 11.3b Perform Quantitative Risk

Analysis 372 / 11.3c Risk Register Updates 373

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11.4 Plan Risk Responses 373 11.4a Strategies for Responding to Risks 373 / 11.4b Risk Register Updates 377 PMP/CAPM Study Ideas 377 Summary 378 Key Terms Consistent with PMI Standards and Guides 378 Chapter Review Questions 379 Discussion Questions 379 PMBOK® Guide Questions 379 Exercises 380 Integrated Example Projects 381 Casa DE PAZ Development Project 381 Semester Project Instructions 382 Project Management in Action 382 References 384 Endnotes 384

CHAPTER 12 Project Quality Planning and Project Kickoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386 12.1 Development of Contemporary Quality Concepts 388

12.1a Quality Gurus 388 / 12.1b Total Quality Management/Malcolm Baldrige 389 / 12.1c ISO 9001:2008 390 / 12.1d Lean Six Sigma 390

12.2 Core Project Quality Concepts 392 12.2a Stakeholder Satisfaction 393 / 12.2b Process Management 394 / 12.2c Fact-

Based Management 396 / 12.2d Fact-Based Project Management Example 398 / 12.2e Empowered Performance 399 / 12.2f Summary of Core Concepts 400

12.3 Plan Quality Management 401 12.3a Quality Policy 401 / 12.3b Quality Management Plan Contents 403 /

12.3c Quality Baseline 404 / 12.3d Process Improvement Plan 404 12.4 Manage Quality 404 12.5 Control Quality 406 12.6 Cost of Quality 409 12.7 Develop Project Management Plan 409

12.7a Resolve Conflicts 409 / 12.7b Establish Configuration Management 410 / 12.7c Apply Sanity Tests to All Project Plans 410

12.8 Kickoff Project 410 12.8a Preconditions to Meeting Success 411 / 12.8b Meeting Activities 411

12.9 Baseline and Communicate Project Management Plan 413 12.10 Using MS Project for Project Baselines 413

12.10a Baseline the Project Plan 413 / 12.10b Create the First Time Baseline 414 / 12.10c Subsequent Baselines 414 / 12.10d Viewing Baselines and Variances 415

PMP/CAPM Study Ideas 416 Summary 417 Key Terms Consistent with PMI Standards and Guides 417 Chapter Review Questions 418

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Discussion Questions 418 PMBOK® Guide Questions 418 Exercises 419 Integrated Example Projects 420 Casa DE PAZ Development Project 420 Semester Project Instructions 420 Project Management in Action 421 References 423 Endnotes 424

PART 4 Performing Projects

CHAPTER 13 Project Supply Chain Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426 13.1 Introduction to Project Supply Chain Management 428

13.1a SCM Components 430 / 13.1b SCM Factors 430 / 13.1c SCM Decisions 430 / 13.1d Project Procurement Management Processes 431

13.2 Plan Procurement Management 431 13.2a Outputs of Planning 431 / 13.2b Make-or-Buy Decisions 432

13.3 Conduct Procurements 434 13.3a Sources for Potential Suppliers 434 / 13.3b Approaches Used When Evaluating

Prospective Suppliers 435 / 13.3c Supplier Selection 436 13.4 Contract Types 438

13.4a Fixed-Price Contracts 439 / 13.4b Cost-Reimbursable Contracts 440 / 13.4c Time and Material (T&M) Contracts 440

13.5 Control Procurements 441 13.6 Improving Project Supply Chains 441

13.6a Project Partnering and Collaboration 442 / 13.6b Third Parties 447 / 13.6c Lean Purchasing 447 / 13.6d Sourcing 447 / 13.6e Logistics 447 / 13.6f Information 448

PMP/CAPM Study Ideas 448 Summary 448 Key Terms Consistent with PMI Standards and Guides 449 Chapter Review Questions 449 Discussion Questions 449 PMBOK® Guide Questions 450 Exercises 451 Integrated Example Projects 451 Casa DE PAZ Development Project 452 Semester Project Instructions 452 Project Management in Action 452 References 453 Endnotes 454

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CHAPTER 14 Determining Project Progress and Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 456 14.1 Project Balanced Scorecard Approach 458 14.2 Internal Project Issues 459

14.2a Direct and Manage Project Work 459 / 14.2b Monitor and Control Project Work 460 / 14.2c Monitoring Project Risk 463 / 14.2d Implement Risk Responses 464 / 14.2e Manage Communications 465 / 14.2f Monitor Communications 467

14.3 Customer Issues 469 14.3a Manage and Control Quality 469 / 14.3b Control Scope 475

14.4 Financial Issues 476 14.4a Control Resources 476 / 14.4b Control Schedule and Costs 476 / 14.4c Earned

Value Management for Controlling Schedule and Costs 476 14.5 Using MS Project to Monitor and Control Projects 480

14.5a What Makes a Schedule Useful? 480 / 14.5b How MS Project Recalculates the Schedule Based on Reported Actuals 481 / 14.5c Current and Future Impacts of Time and Cost Variance 481 / 14.5d Define the Performance Update Process 481 / 14.5e Steps to Update the Project Schedule 482

14.6 Replanning If Necessary 487 PMP/CAPM Study Ideas 488 Summary 488 Key Terms Consistent with PMI Standards and Guides 488 Chapter Review Questions 489 Discussion Questions 489 PMBOK® Guide Questions 490 Exercises 491 Integrated Example Projects 492 Casa DE PAZ Development Project 493 Semester Project Instructions 493 Project Management in Action 494 References 496 Endnotes 497

CHAPTER 15 Finishing the Project and Realizing the Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498 15.1 Validate Scope 500 15.2 Terminate Projects Early 501 15.3 Close Project 503

15.3a Write Transition Plan 503 / 15.3b Knowledge Management 504 / 15.3c Create the Closeout Report 508

15.4 Post-Project Activities 509 15.4a Reassign Workers 509 / 15.4b Celebrate Success and Reward Participants 509 /

15.4c Provide Ongoing Support 510 / 15.4d Ensure Project Benefits Are Realized 510

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15.5 Using MS Project for Project Closure 511 15.5a Creating Project Progress Reports 511 / 15.5b Archiving Project Work 512 PMP/CAPM Study Ideas 515 Summary 515 Key Terms Consistent with PMI Standards and Guides 515 Chapter Review Questions 515 Discussion Questions 516 PMBOK® Guide Questions 516 Exercise 517 Integrated Example Projects 517 Casa DE PAZ Development Project 518 Semester Project Instructions 518 Project Management in Action 518 References 520 Endnotes 521

Appendix A PMP and CAPM Exam Prep Suggestions . . . . . . . . . . . . . . . . . . . . . . . . . . 522 Appendix B Agile Differences Covered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 527 Appendix C Answers to Selected Exercises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 532 Appendix D Project Deliverables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 537 Appendix E Strengths Themes As Used in Project Management . . . . [Available Online] Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539

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Preface

While project managers today still need to use many techniques that have stood the test of several decades, they increasingly also must recognize the business need for a project, sort through multiple conflicting stakeholder demands. They must know how to deal with rapid change, a myriad of communication issues, global and virtual project teams, modern approaches to quality improvement, when to tailor their project management approach to include methods and behaviors from Agile, and many other issues that are more challenging than those in projects of the past.

Contemporary project management utilizes the tried-and-true project management techniques along with modern improvements such as the most current versions of Micro- soft® Project Professional 2016, the sixth edition of the Guide to the Project Management Body of Knowledge (PMBOK® Guide), and many approaches derived from adaptive (Agile) project management. Contemporary project management also uses many tools and understandings that come from modern approaches to quality and communications, expanded role definitions, leadership principles, human strengths, and many other sources. Contemporary project management is scalable, using simple versions of impor- tant techniques on small projects and more involved versions on more complex projects.

Distinctive Approach This book covers contemporary project management topics using contemporary project management methods. For example, when considering the topic of dealing with multiple stakeholders, every chapter was reviewed by students, practitioners, and academics. This allowed simultaneous consideration of student learning, practitioner realism, and aca- demic research and teaching perspectives.

The practical examples and practitioner reviewers came from a variety of industries, dif- ferent parts of the world, and from many sizes and types of projects in order to emphasize the scalability and universality of contemporary project management techniques.

New to This Edition Core, behavioral, and technical learning objectives. We have expanded the number of learning objectives and classified them as core, behavioral, or technical. About half of the objectives are core: what we believe every student of project management should learn. A professor could teach a solid project management introductory class by deeply using only the core objectives. On the other hand, there are measurable student objectives for either a behavioral or a technical approach. All suggested stu- dent assignments and questions are tied specifically to one of the learning objectives. A professor could use this text for a two-semester sequence that emphasizes both in- depth behavioral and technical approaches. Videos. Exclusively available to those using the MindTap product for this book, we have created dozens of short (average time, five minutes) videos to show the art of many of the techniques. These demonstrate the use of many of the techniques in a by-hand or spreadsheet fashion as well as using Microsoft Project 2016. Several questions that can be assigned to students are included with the videos that

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demonstrate how to use Microsoft Project to complement learning. Answers (some- times definitive, sometimes representative, depending on the nature of the tech- nique) are included in the instructor’s manual (IM). Extensive flowchart to help the sixth edition of the PMBOK® Guide come to life. All sixth edition PMBOK® Guide knowledge areas, processes, and process groups, plus major deliverables from each process and the primary workflows between them, are specifically included in an interactive, color-coded flowchart that is included in full inside the back cover of the text. We also start each chapter by showing the portion of the flowchart that is covered in that chapter. We now use definitions both from the PMBOK® Guide, Sixth Edition and also from more than a dozen Project Management Institute specialized Practice Guides and Standards. The end of each chapter contains specific suggestions for PMP® and CAPM® test preparation pertaining to the chapter’s topics plus ten PMBOK® Guide-type ques- tions that are typical of what would be seen on PMP® and CAPM® exams. Appendix A gives general study suggestions for the CAPM® and PMP® exams. Project deliverables. A list of 38 project deliverables that can be used as assignments for students and in-class exercises are included in Appendix D. Each deliverable is specifically tied to a student learning objective and shown on the PMBOK® Guide flowchart. About half of these are core, while the others are behavioral or technical. Examples of completed deliverables are included in the text. Teaching suggestions and grading rubrics are included in the IM. Appendix D identifies the type of objec- tive, chapter covered, and PMBOK® Guide process, knowledge area, and process group in which the deliverable is typically created on a real project. Substantial increase in Agile coverage. Agile techniques and methods are consid- ered much more often than even three years ago. As such, many experienced project managers who have also become Agile proponents have contributed to the increased Agile coverage in this book. At multiple points in most chapters, if Agile methods or suggested behaviors are different from traditional project management, these varia- tions are noted. We use an Agile icon to draw attention to these. We also have cre- ated Appendix B, which is a bulleted list of the approximately 180 differences between Agile and traditional project management that are discussed in the book. This extensive coverage allows a professor to teach project management emphasizing an Agile approach, if desired. It also allows a professor to develop an Agile project management course. Two new continuing project examples. We have created two project examples that are included in all 15 chapters of the text. One project is a construction project by a for-profit company that is planned and managed in a traditional fashion. The other is a development project at a nonprofit that is planned and managed in a more (but not exclusively) Agile fashion. In Chapter 1, we introduce both these case studies. After that, we alternate chapters, with each chapter showing what one project did using the concepts and techniques of a chapter and posing questions for the stu- dents to answer about the other project. Answers to the questions are in the IM. This can be another useful vehicle for students to practice their skills and to generate class discussion.

Distinctive Features PMBOK® Guide, Sixth Edition approach. This consistency with the current stan- dard gives students a significant leg up if they decide to become certified Project Management Professionals (PMPs®) or Certified Associates in Project Management

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(CAPMs®). This text includes an color-coded PMBOK® Guide, Sixth Edition flow- chart, all definitions consistent with PMI guides and standards, CAPM and PMP test preparation suggestions, and test practice questions. Actual project as learning vehicle. A section at the end of each chapter lists deliver- ables for students to create (in teams or individually) for a real project. These assign- ments have been refined over the last two decades while working with the local PMI® chapter, which provided a panel of PMP® judges to evaluate projects from a practical point of view. Included in the IM are extensive tools and suggestions devel- oped over the last 20 years for instructors, guiding them as they have students learn in the best possible way—with real projects. Students are encouraged to keep clean copies of all deliverables so they can demonstrate their project skills in job inter- views. A listing of these deliverables is included in Appendix D. Student-oriented, measurable learning objectives. Each chapter begins with a list of the core objectives for the chapter along with more in-depth behavioral and/or tech- nical objectives for most chapters. The chapter also starts with showing the PMBOK® topics covered in the chapter. The chapter material, end-of-chapter ques- tions and problems, PowerPoint® slides, all deliverables, and test questions have all been updated to correlate to specific objectives. Microsoft® Project Professional 2016 fully integrated into the fabric of eight chap- ters. Microsoft® Project Professional 2016 is shown in a step-by-step manner with numerous screen captures. On all screen captures, critical path activities are shown in contrasting color for emphasis. We have created videos to demonstrate these techniques and developed questions tied to specific learning objectives that can be assigned to the videos to test student learning. Blend of traditional and modern methods. Proven methods developed over the past half century are combined with exciting new methods, including Agile, that are emerging from both industry and research. This book covers the responsibilities of many individuals who can have an impact on projects both as they are practiced in traditional and in Agile environments, so aspiring project managers can understand not only their own roles, but also those of people with whom they need to interact. Integrated example projects. A variety of experienced project leaders from around the world have contributed examples to demonstrate many of the techniques and concepts throughout the book. These highly experienced and credentialed managers have worked closely with the authors to ensure that the examples demonstrate ideas discussed in the chapter. The variety of industries, locations, and sizes of the projects help the students to visualize both how universal project management is and how to appropriately scale the planning and management activities.

Organization of Topics The book is divided into four major parts. Part 1, Organizing Projects, deals with get- ting a project officially approved.

Chapter 1 introduces contemporary project management by first tracing the history of project management and then discussing what makes a project different from an ongoing operation. Various frameworks that help one understand projects— such as the PMBOK® Guide and Agile—are introduced, as well as the executive-, managerial-, and associate-level roles in managing projects. Chapter 2 discusses how projects support and are an outgrowth of strategic plan- ning, how a portfolio of projects is selected and prioritized, how a client company

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selects a contractor company to conduct a project, and how a contractor company secures project opportunities from client companies. Chapter 3 presents project charters in a step-by-step fashion. Short, powerful charters help all key participants to develop a common understanding of key project issues and components at a high level and then to formally commit to the project. Charters have become nearly universal in initiating projects in recent years. Microsoft® Project Pro- fessional 2016 is utilized to show milestone schedules within charters.

Part 2, Leading Projects, deals with understanding the project environment and roles and dealing effectively with team members and stakeholders.

Chapter 4 deals with organizational capability issues of structure, life cycle, culture, and roles. The choices parent organizations make in each of these provide both opportunities and limitations to how projects can be conducted. Chapter 5 deals with leading and managing the project team. It includes acquiring and developing the project team, assessing both potential and actual performance of team members and the team as a whole, various types of power a project manager can use, and how to deal productively with project conflict. Chapter 6 introduces methods for understanding and prioritizing various stake- holder demands and for building constructive relationships with stakeholders. Since many projects are less successful due to poor communications, detailed communica- tion planning techniques are introduced along with suggestions for managing meet- ings, an important channel of communication.

Part 3, Planning Projects, deals with all aspects of project planning as defined in thePMBOK® Guide. It proceeds in the most logical order possible to maximize effective- ness and stress continuity, so that each chapter builds on the previous ones, and students can appreciate the interplay between the various knowledge areas and processes.

Chapter 7 helps students understand how to determine the amount of work the project entails. Specifically covered are methods for determining the scope of both the project work and outputs, the work breakdown structure (WBS) that is used to ensure nothing is left out, and how the WBS is portrayed using Microsoft® Project Professional 2016. Chapter 8 is the first scheduling chapter. It shows how to schedule project activities by identifying, sequencing, and estimating the durations for each activity. Then, crit- ical path project schedules are developed, and methods are shown for dealing with uncertainty in time estimates, Gantt charts are introduced for easier communica- tions, and Microsoft® Project Professional 2016 is used to automate the schedule development and communications. Chapter 9 is the second scheduling chapter. Once the critical path schedule is deter- mined, staff management plans are developed, project team composition issues are considered, resources are assigned to activities, and resource overloads are identified and handled. Schedule compression techniques of crashing and fast tracking are demonstrated, and multiple alternative scheduling techniques including Agile are introduced. Resource scheduling is demonstrated with Microsoft® Project Profes- sional 2016. Chapter 10 deals with project budgeting. Estimating cost, budgeting cost, and estab- lishing cost controls are demonstrated. Microsoft® Project Professional 2016 is used for developing both bottom-up and summary project budgets. Chapter 11 demonstrates project risk planning. It includes risk management plan- ning methods for identifying risks, establishing a risk register, qualitatively analyzing

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risks for probability and impact, quantitatively analyzing risks if needed, and decid- ing how to respond to each risk with contingency plans for major risks and aware- ness for minor risks. Chapter 12 starts by covering project quality planning. This includes explaining the development of modern quality concepts and how they distill into core project qual- ity demands. Next, the chapter covers how to develop a project quality plan. It then ties all of the planning chapters together with discussions of a project kickoff meet- ing, a baselined project plan, and the ways Microsoft® Project Professional 2016 can be used to establish and maintain the baseline.

Part 4, Performing Projects, discusses the various aspects that must be managed simultaneously while the project is being conducted.

Chapter 13 deals with project supply chain management issues. Some of these issues, such as developing the procurement management plan, qualifying and selecting ven- dors, and determining the type of contract to use are planning issues, but for sim- plicity, they are covered in one chapter with sections on how to conduct and control procurements and to improve the project supply chain. Chapter 14 is concerned with determining project results. This chapter starts with a balanced scorecard approach to controlling projects. Internal project issues covered include risk, change, and communication. Quality is also covered, with an emphasis on achieving client satisfaction. Financial issues discussed are scope, cost, and sched- ule, including how to use Microsoft® Project Professional 2016 for control. Chapter 15 deals with how to end a project—either early or on time. This includes validating to ensure all scope is complete, formally closing procurements and the project, knowledge management, and ensuring the project participants are rewarded and the clients have the support they need to realize intended benefits when using the project deliverables.

MindTap MindTap is a complete digital solution for your project management course. It has enhancements that take students from learning basic concepts to actively engaging in critical thinking applications, while learning Project 2016 skills for their future careers.

The MindTap product for this book features videos from the authors that explain tricky concepts, videos that explain the finer points of what you can do with Project 2016, and quizzes and homework assignments with detailed feedback so that students will have a better understanding of why an answer is right or wrong.

Instructor Resources To access the instructor resources, go to www.cengage.com/login, log in with your SSO account username and password, and search this book’s ISBN (9781337406451) to add instructor resources to your account. Key support materials—instructor’s manual with solutions, test bank in Word and Blackboard formats, data set solutions, and PowerPoint® presentations—provide instructors with a comprehensive capability for customizing their classroom experience. All student resources are also available on the instructor companion site.

Instructor s Manual with Solutions. Prepared by Tim Kloppenborg and updated by Kate Wells, based on their years of experience facilitating the student learning expe- rience in their own project management classes (undergraduate, MBA, Masters in

xxiv Preface

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Health Informatics, and continuing education on six continents), with teaching in classroom, hybrid, and online formats, each chapter of the instructor’s manual includes an overview of core, behavioral, and technical learning objectives, detailed chapter outlines, teaching recommendations for both classroom and online, and many specific suggestions for implementing community-based projects into your project management class. Solutions are also provided for all of the end-of-chapter content. Microsoft® Word Test Bank. Prepared for this edition by Joyce D. Brown, PMP® and Thomas F. McCabe, PMP® of the University of Connecticut, this comprehen- sive test bank builds upon the original test bank created by Kevin Grant of the Uni- versity of Texas at San Antonio. The test bank is organized around each chapter’s learning objectives. All test questions are consistent with the PMBOK®. Every test item is labeled according to its difficulty level, the learning objective within the text- book to which it relates, and its Blooms Taxonomy level, allowing instructors to quickly construct effective tests that emphasize the concepts most significant for their courses. The test bank includes true/false, multiple choice, essay, and quantita- tive problems for each chapter. Cognero Test Bank. Cengage Learning Testing Powered by Cognero is a flexible, online system that allows you to author, edit, and manage test bank content from multiple Cengage Learning solutions; create multiple test versions in an instant; and deliver tests from your LMS, your classroom, or wherever you want. The Cog- nero test bank contains the same questions that are in the Microsoft® Word test bank. PowerPoint Presentations. Prepared by Kate Wells, the PowerPoint presentations provide comprehensive coverage of each chapter’s essential concepts in a clean, con- cise format. Instructors can easily customize the PowerPoint presentations to better fit the needs of their classroom. Templates. Electronic templates for many of the techniques (student deliverables) are available on the textbook companion website. These Microsoft® Word and Excel documents can be downloaded and filled in for ease of student learning and for consistency of instructor grading.

Student Resources Students can access the following resources by going to www.cengagebrain.com and searching 9781337406451. The companion website for this book has Excel and Word Project templates, data sets for selected chapters, and instructions for how to get access to a trial version of Microsoft Online Professional Trial. (Note that while we are happy to provide instructions for accessing this trial, Microsoft controls that access and we are not responsible for it being removed in the future.)

Acknowledgments A book-writing project depends on many people. Through the last three decades of proj- ect work, we have been privileged to learn from thousands of people, including students, faculty members, co-trainers, co-consultants, co-judges, clients, research partners, trade book authors, and others. Hundreds of individuals who have provided help in research and developing teaching methods are co-members of the following:

PMI’s undergraduate curriculum guidelines development team, PMI’s Global Accreditation Center,

Preface xxv

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Multiple chapters of the Project Management Institute, The Cincinnati and Louisville sections of the Center for Quality of Management, Project Management Executive Forum, and Agile Cincinnati.

We also want to acknowledge the wonderful help of various professionals at Cengage Learning, including Aaron Arnsparger (Sr. Product Manager) and Conor Allen (Content Developer). We also want to thank Charles McCormick, Jr., retired Senior Acquisitions Editor, for his extensive help and guidance on the first and second editions of Contem- porary Project Management.

Other individuals who have provided significant content are Nathan Johnson of Western Carolina University, who provided the Microsoft® Project 2016 material, Joyce D. Brown, PMP® and Thomas F. McCabe, PMP® of University of Connecticut, who revised the test bank and provided additional PMBOK® questions to each chapter, Jim King, who professionally taped and edited videos, and Kathryn N. Wells, Independent Consultant, PMP®, CAPM®, who provided the PowerPoint presentations.

Special thanks are also due to all the people whose feedback and suggestions have shaped this edition of Contemporary Project Management as well as the previous two editions:

Carol Abbott, Fusion Alliance, Inc.

Stephen Allen, Truman State University

Siti Arshad-Snyder, Clarkson College

Loretta Beavers, Southwest Virginia Community College

Shari Bleure, Skyline Chili

Neil Burgess, Albertus Magnus College

Reynold Byers, Arizona State University

John Cain, Viox Services

Robert Clarkson, Davenport University

Nancy Cornell, Northeastern University

Steve Creason, Metropolitan State University

Jacob J. Dell, University of Texas at San Antonio

Scott Dellana, East Carolina University

Maling Ebrahimpour, Roger Williams University

Jeff Flynn, ILSCO Corporation

Jim Ford, University of Delaware

Lynn Frock, Lynn Frock & Company

Lei Fu, Hefei University of Technology

Patricia Galdeen, Lourdes University

Kathleen Gallon, Christ Hospital

Paul Gentine, Bethany College

Kevin P. Grant, University of Texas–San Antonio

Joseph Griffin, Northeastern University

Raye Guye, ILSCO Corporation

William M. Hayden Jr., State University of New York at Buffalo

Sarai Hedges, University of Cincinnati

Marco Hernandez, Dantes Canadian

Stephen Holoviak, Pennsylvania State University

Bill Holt, North Seattle Community College

Morris Hsi, Lawrence Tech University

xxvi Preface

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Sonya Hsu, University of Louisiana Lafayette

Paul Hudec, Milwaukee School of Engineering

Anil B. Jambekar, Michigan Technological University

Dana Johnson, Michigan Technological University

Robert Judge, San Diego State University

David L. Keeney, Stevens Institute of Technology

George Kenyon, Lamar University

Naomi Kinney, MultiLingual Learning Services

Paul Kling, Duke Energy

Matthew Korpusik, Six Sigma Black Belt

Sal Kukalis, California State University–Long Beach

Young Hoon Kwak, George Washington University

Laurence J. Laning, Procter & Gamble

Dick Larkin, Central Washington University

Lydia Lavigne, Ball Aerospace

Jon Lazarus, Willamette University

James Leaman, Eastern Mennonite University

Linda LeSage, Davenport University

Claudia Levi, Edmonds Community College

Marvette Limon, University of Houston Downtown

John S. Loucks, St. Edward’s University

Diane Lucas, Penn State University– DuBois Campus

Clayton Maas, Davenport University

S. G. Marlow, California State Polytechnic University

Daniel S. Marrone, SUNY Farmingdale State College

Chris McCale, Regis University

Abe Meilich, Walden University

Bruce Miller, Xavier Leadership Center

Ali Mir, William Paterson University

William Moylan, Eastern Michigan University

Merlin Nuss, MidAmerica Nazarene University

Warren Opfer, Life Science Services International

Peerasit Patanakul, Stevens Institute of Technology

Joseph Petrick, Wright State University

Kenneth R. Pflieger, Potomac College

Charles K. Pickar, Johns Hopkins University

Connie Plowman, Portland Community College

Mark Poore, Roanoke College

Antonios Printezis, Arizona State University

Joshua Ramirez, PMP, MSM-PM, Columbia Basin College

Chris Rawlings, Bob Jones University

Natalee Regal, Procter & Gamble

Pedro Reyes, Baylor University

Linda Ridlon, Center for Quality of Management, Division of GOAL/QPC

Kim Roberts, Athens State University

David Schmitz, Milwaukee School of Engineering

Sheryl R. Schoenacher, SUNY Farmingdale State College

Jan Sepate, Kimberly Clark

Patrick Sepate, Summitqwest Inc.

Preface xxvii

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William R. Sherrard, San Diego State University

Brian M. Smith, Eastern University

Kimberlee D. Snyder, Winona State University

Tony Taylor, MidAmerica Nazarene University

Rachana Thariani, Atos-Origin

Dawn Tolonen, Xavier University

Nate Tucker, Lee University

Guy Turner, Castellini Company

Jayashree Venkatraman, Microsoft Corporation

Nathan Washington, Southwest Tennessee Community College

Scott Wright, University of Wisconsin– Platteville

And we especially want to thank our family members for their love and support: Bet, Nick, Jill, Andy, Cadence, and Ellie

—Timothy J. Kloppenborg

xxviii Preface

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About the Authors Timothy J. Kloppenborg is an Emeritus Professor of Management at Williams Col- lege of Business, Xavier University. He previously held faculty positions at University of North Carolina Charlotte and Air Force Institute of Technology and has worked temporarily at Southern Cross University and Tecnológico de Monterrey. He has authored over 100 publications, including 10 books, such as Strategic Leadership of Portfolio and Project Management, Project Leadership, and Managing Project Quality. His articles have appeared in MIT Sloan Management Review, Project Management Journal, Journal of Management Education, Journal of General Management, SAM Advanced Management Journal, Information Systems Education Journal, Journal of Managerial Issues, Quality Progress, Management Research News, and Journal of Small Business Strategy. In his capacity as the founding collection editor of portfolio and project management books for Business Expert Press, he has edited 14 books with more in the pipeline. Tim has been active with the Project Management Institute for over 30 years and a PMP® since 1991. He is a retired U.S. Air Force Reserve officer who served in transportation, procurement, and quality assurance. Dr. Kloppenborg has worked with over 150 volunteer organizations, many directly and others through supervising student projects. He has hands-on and consulting project management experience on six continents in construction, information systems, research and devel- opment, and quality improvement projects with organizations such Duke Energy, Ernst and Young LLP, Greater Cincinnati Water Works, Kroger, Procter & Gamble, Tri- Health, and Texas Children’s Hospital. Dr. Kloppenborg has developed and delivered innovative corporate training, undergraduate, MBA, and Executive MBA classes in project management, leadership, teamwork, and quality improvement and he teaches PMP Prep classes. He holds a BS in business administration from Benedictine College, an MBA from Western Illinois University, and a PhD in Operations Management from University of Cincinnati.

Dr. Vittal Anantatmula is a professor in the College of Business, Western Carolina University and a campus of University of North Carolina. He is also the Director of Graduate Programs in Project Management and was a recipient of excellence in teaching and research awards. Dr. Anantatmula is a Global Guest Professor at Keio University, Yokohama, Japan. He is a director and board member of the Project Management Insti- tute Global Accreditation Center (PMI-GAC). He serves on the editorial board of several scholarly journals. At Western Carolina University, he was recognized with the Univer- sity Scholar Award in 2017. He has won several other awards for excellence in both research and teaching.

Prior to joining Western Carolina University, he taught at The George Washington University. He worked in the petroleum and power industries for several years as an electrical engineer and project manager and as a consultant in several international orga- nizations, including the World Bank. Dr. Anantatmula has authored more than 60 pub- lications, five books, and about 50 conference papers. Two of his conference papers received the best paper award. His work has been published in scholarly journals, includ- ing Project Management Journal, Journal of Knowledge Management, Journal of Manage- ment in Engineering, Journal of Information and Knowledge Management Systems, and

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Engineering Management Journal. He received his PhD from The George Washington University and is a certified project management professional.

Kathryn N. Wells holds a master’s degree in Education, as well as degrees in Organi- zational Communication and Spanish. Kate has a passion for teaching, in both academic and corporate settings. In addition to over a decade’s experience in project management education, Kate is a top-producing real estate agent with Keller Williams. Her blend of experience in real estate—including working with many investors—and classroom teach- ing gives her a unique perspective and insights into many components of project man- agement, including Planning, Communication, Stakeholder Management, and Project Control.

In addition to her work on Contemporary Project Management, Kate is the lead author of Project Management Essentials (2015) and co-author of Project Management for Archaeology (2017), both published by Business Expert Press. She has trained and consulted with several organizations around the world and has occasionally been con- tracted to provide translations of project management educational materials (Spanish to English). Some of her clients include the University of Cincinnati, Children’s Hospital of Cincinnati, Givaudan International, and Tec de Monterrey University—where Kate has repeatedly served as visiting faculty at multiple campuses in Mexico. Kate is a certified project management professional (PMP).

xxx About the Authors

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1

ORGANIZE LEAD PERFORMPLAN

P A R T 1

ORGANIZING PROJECTS

Chapter 1 Introduction to Project Management

Chapter 2 Project Selection and Prioritization

Chapter 3 Chartering Projects

Organizing for success in project management includes

several basic frameworks for understanding projects and

tools to select, prioritize, resource, and initiate projects.

Basic frameworks described in Chapter 1 include how

the work of project management can be categorized by

knowledge area and process group, how project success

is determined, and how both plan-driven and adaptive

approaches are frequently used. Chapter 2 describes

how projects are investments meant to help achieve

organizational goals. Tools are demonstrated to select,

prioritize, and resource projects. Chapter 3 describes

how charters are essential to initiating projects and then

demonstrates how to construct each portion of a charter.

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C H A P T E R 1

Introduction to Project Management

I have returned from a successful climb of Mount Aconcagua in Argentina; at 22,841 feet, it is the highest peak in the world outside of the Himalayas. While there, seven other climbers died; we not only survived, but our experience was so positive that we have partnered to climb together again.

During the three decades that I ve been climbing mountains, I ve also been managing projects. An element has emerged as essential for success in both of these activities: the element of discipline. By discipline, I am referring to doing what I already know needs to be done. Without this attribute, even the most knowledgeable and experienced will have difficulty avoiding failure.

The deaths on Aconcagua are an extreme example of the consequences asso- ciated with a lack of discipline. The unfortunate climbers, who knew that the pre- dicted storms would produce very hazardous conditions, decided to attempt the summit instead of waiting. They did not have the discipline that we demonstrated to act on our earlier decision to curtail summit attempts after the agreed-to turn- around time or in severe weather.

CHAPTER OBJECTIVES

After completing this chapter, you should be able to:

CORE OBJECTIVES: Define a project and project management in your own words, using characteristics that are common to most projects, and describe reasons why more organizations are using project management. Describe major activ- ities and deliverables at each project life cycle stage. List and define the ten knowledge areas and five process groups of the project manage- ment body of knowl- edge (PMBOK ®). Delineate measures of project success and failure, and reasons for both. Contrast predictive or plan-driven and adaptive or change- driven project life cycle approaches.

BEHAVIORAL OBJECTIVES: Identify project roles and distinguish key responsibilities for project team members. Describe the impor- tance of collaborative effort during the project life cycle.

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I ve experienced similar circumstances in project management. Often I have found myself under pressure to cast aside or shortcut project management prac- tices that I have come to rely on. For me, these practices have become the pillars of my own project management discipline. One of these pillars, planning, seems to be particularly susceptible to challenge. Managing projects at the Central Intelli- gence Agency for three decades, I adjusted to the annual cycle for obtaining fund- ing. This cycle occasionally involved being given relatively short notice near the end of the year that funds unspent by some other department were up for grabs to whoever could quickly make a convincing business case. While some may inter- pret this as a circumstance requiring shortcutting the necessary amount of plan- ning in order to capture some of the briefly available funds, I understood that my discipline required me to find a way to do the needed planning and to act quickly. I understood that to do otherwise would likely propel me toward becoming one of the two-thirds of the projects identified by the Standish Group in their 2009 CHAOS report as not successful. I understood that the top 2 percent of project managers, referred to as Alpha Project Managers in a 2006 book of the same name, spend twice as much time planning as the other 98 percent of project man- agers. The approach that I took allowed me to maintain the discipline for my plan- ning pillar. I preplanned a couple of projects and had them ready at the end of the year to be submitted should a momentary funding opportunity arise.

A key to success in project management, as well as in mountain climbing, is to identify the pillars that will be practiced with discipline. This book offers an excel- lent set of project management methods from which we can identify those pillars that we will decide to practice with the required levels of discipline. I believe that project management is about applying common sense with uncommon discipline.

Michael O Brochta, PMP, founder of Zozer Inc. and previously senior project manager at the Central Intelligence Agency

1-1 What Is a Project? Frequently, a business is faced with making a change, such as improving an existing work process, constructing a building, installing a new computer system, merging with another company, moving to a new location, developing a new product, entering a new market, and so on. These changes are best planned and managed as projects.

Often, these changes are initiated due to operational necessity or to meet strategic goals, such as the following:

Market demand Customer request

PMBOK ® 6E COVERAGE

PMBOK ® 6E OUTPUTS

1.2 Foundational Elements Project Customer Trade-off Matrix

2.4 Organizational Systems Project Success Definition

3.3 The Project Manager s Sphere of Influence

3.4 Project Manager Competencies

3.5 Performing Integration

PMBOK® GUIDE Topics:

Project management introduction Project life cycle Stakeholders Project management process Project integration management

CHAPTER OUTPUTS Customer Trade-off Matrix Project Success Definition

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Technological advance Legal requirements or regulatory compliance Replace obsolete equipment, technology, system, or physical facility Crisis situation Social need

So, what is a project? A project is a new, time-bound effort that has a definite beginning and a definite

ending with several related and/or interdependent tasks to create a unique product or service. The word temporary is used to denote project duration; however, it does not mean that project duration is short; in fact, it can range from a few weeks to several years. Temporary also does not apply to the project deliverable, although project teams are certainly temporary.

A project requires an organized set of work efforts that are planned with a level of detail that is progressively elaborated on as more information is discovered. Projects are subject to limitations of time and resources such as money and people. Projects should follow a planned and organized approach with a defined beginning and ending. Project plans and goals become more specific as early work is completed. The project output often is a collection of a primary deliverable along with supporting deliverables such as a house as the primary deliverable and warrantees and instructions for use as supporting deliverables.

Taking all these issues into consideration, a project can be defined as a time-bound effort constrained by performance specifications, resources, and budget to create a unique product or service.

Each project typically has a unique combination of stakeholders. Stakeholders are people and groups who can impact the project or might be impacted by either the work or results of the project. Projects often require a variety of people to work together for a limited time, and all participants need to understand that completing the project will require effort in addition to their other assigned work. These people become members of the project team and usually represent diverse functions and disciplines.

Project management is the art and science of using knowledge, skills, tools, and tech- niques efficiently and effectively to meet stakeholder needs and expectations. This includes work processes that initiate, plan, execute, control, and close work. During these processes, trade-offs must be made among the following factors:

Scope (size and features) Quality (acceptability of the results) Cost Schedule Resources Risks

When project managers successfully make these trade-offs, the project results meet the agreed-upon requirements, are useful to the customers, and promote the organiza- tion. Project management includes both administrative tasks for planning, documenting, and controlling work and leadership tasks for visioning, motivating, and promoting work associates. The underlying principle of project management discipline is to make effec- tive and efficient use of all resources and it is this principle that influences some of these trade-off decisions. Project management knowledge, skills, and methods can be applied and modified for most projects regardless of size or application.

4 Part 1 Organizing Projects

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1-2 History of Project Management Projects of all sizes have been undertaken throughout history. Early construction pro- jects included the ancient pyramids, medieval cathedrals, Indian cities, and Native American pueblos. Other large early projects involved waging wars and building empires. In the development of the United States, projects included laying railroads, developing farms, and building cities. Many smaller projects consisted of building houses and starting businesses. Projects were conducted throughout most of the world s history, but there was very little documentation. Therefore, there is no evidence of systematic planning and control. It is known that some early projects were accom- plished at great human and financial cost and that others took exceedingly long peri- ods of time to complete. For example, the Panama Canal was started in 1881 and completed in 1914.

Project management eventually emerged as a formal discipline to be studied and practiced. In the 1950s and 1960s, techniques for planning and controlling schedules and costs were developed, primarily on huge aerospace and construction projects. Dur- ing this time, project management was primarily involved in determining project sche- dules based on understanding the order in which work activities had to be completed. Many large manufacturing, research and development, government, and construction projects used and refined management techniques. In the 1980s and 1990s, several software companies offered ever more powerful and easier ways to plan and control project costs and schedules. Risk management techniques that were originally devel- oped on complex projects have increasingly been applied in a simplified form to less complex projects.

In the last few years, people have realized more and more that communication and leadership play major roles in project success. Rapid growth and changes in the information technology and telecommunications industries especially have fueled massive growth in the use of project management in the 1990s and early 2000s. Simultaneously, systems and processes were developed for electronic documentation of the historical data of projects using information systems (IS) and knowledge man- agement tools.

People who are engaged in a wide variety of industries, including banking, insurance, retailing, hospital administration, healthcare, and many other service industries, are now turning to project management to help them plan and manage efforts to meet their unique demands. Project planning and management techniques that were originally developed for large, complex projects can be modified and used to better plan and man- age even smaller projects. Now, project management is commonly used on projects of many sizes and types in a wide variety of manufacturing, government, service, and non- profit organizations.

Further, in today s global economy, geographically dispersed virtual project teams are becoming a familiar entity in many organizations. Managing a project is challenging in the current global economy due to the exponential growth of information technology and ever-increasing market demand that organizations offer products and services effi- ciently and quickly. Understanding the characteristics of global projects for improving global project performance is of critical importance.

The use of project management has grown quite rapidly and is likely to continue growing. With increased international competition and a borderless global economy, customers want their products and services developed and delivered better, faster, and cheaper. Because project management techniques are designed to manage scope, quality, cost, and schedule, they are ideally suited to this purpose.

Chapter 1 Introduction to Project Management 5

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AGILE Throughout this book, we will present concepts and techniques that are either unique toAgile projects or are emphasized more on Agile projects. Many of these ideas can be used to improve practice on traditional projects.

In 2001, a group of thought leaders became frustrated with the use of traditional, plan-driven project management for software projects and as a result, they wrote a doc- ument called The Agile Manifesto.1 The four core values of Agile as shown below are completely consistent with our approach to Contemporary Project Management. Agile will be defined in Chapter 3, but throughout the book, a margin icon will indicate ideas from Agile, and the text will be in color.

Value individuals more than processes. Value working software more than documentation. Value customer collaboration more than negotiation. Value response to change over following a plan.

1-3 How Can Project Work Be Described? Project work can be described in the following ways:

Projects are temporary and unique, while other work, commonly called operations, is more continuous. Project managers need certain soft skills and hard skills to be effective. Project managers frequently have more responsibility than authority. Projects go through predictable stages called a life cycle.

Managing a project requires identifying requirements, establishing clear and achiev- able objectives, balancing competing demands of quality, scope, cost, and time, and meeting customer expectations by making adjustments to all aspects of the project. Due to uniqueness, projects are often associated with uncertainties and unknowns that pres- ent many challenges to managing project work.

1-3a Projects versus Operations All work can be described as fitting into one of two types: projects or operations. Projects as stated above are temporary, and no two are identical. Some projects may be extremely different from any other work an organization has performed up to that time, such as planning a merger with another company. Other projects may have both routine and unique aspects, for example, building a house; such projects can be termed process ori- ented. These projects are associated with fewer unknowns and uncertainties.

Operations, on the other hand, consist of the ongoing work needed to ensure that an organization continues to function effectively. Operations managers can often use check- lists to guide much of their work. Project managers can use project management methods to help determine what to do, but they rarely have checklists that identify all the activities they need to accomplish. Some work may be difficult to classify as totally project or totally operations. However, if project management methods and concepts help one to better plan and manage work, it does not really matter how the work is classified.

Both the projects and the operations are associated with processes. A process is described as a series of actions designed to bring about the consistent and similar result or service. A process is usually designed to improve productivity. Thus, processes are repetitive and pro- duce consistent and similar results, whereas projects are unique: each project delivers results that are distinct from other projects. However, one must remember that project manage- ment discipline includes various processes (planning, risk management, communication

6 Part 1 Organizing Projects

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management, etc.) that facilitate managing projects and product- or service-oriented processes such as scope definition, scope management, and quality management.

1-3b Soft Skills and Hard Skills To effectively manage and lead in a project environment, a person needs to develop both soft and hard skills. Soft skills include the ability to work in teams, interpersonal

skills, communication, conflict resolution, negotiation, and leadership activities. Hard skills can include risk analysis, quality control, scheduling, budgeting, change control, planning other related activities, and project execution. Soft and hard skills go hand in hand. Some people have a stronger natural ability and a better comfort level in one or the other, but to be successful as a project manager, a person needs to develop both, along with the judgment about when each is needed. A wise project manager may pur- posefully recruit an assistant who excels in his area of weakness. Training, experience, and mentoring can also be instrumental in developing necessary skills.

Soft skills such as interpersonal relations, conflict resolution, and communication are of critical importance in managing people. As such, of all the resources, managing human resources presents more challenges. Managing and leading people are the most challenging aspects of a managing a project and the project team. These challenges underline the importance of soft skills.

1-3c Authority and Responsibility A project manager will frequently be held accountable for work that she cannot order people to perform. Projects are most effectively managed with one person being assigned accountability. However, that person often needs to negotiate with a functional man- ager, who is someone with management authority over an organizational unit. 2 Func- tional managers negotiate for workers to perform the project work in a timely fashion. Since the workers know their regular manager often has other tasks for them and will be their primary rater, they are tempted to concentrate first on the work that will earn rewards. Hence, a project manager needs to develop strong communication and leader- ship skills to extract cooperation from functional managers and to persuade project team members to focus on the project when other work also beckons. Often, it is the project manager s responsibility that the work be performed, but at the same time, he or she has no formal authority over the project team members.

1-3d Project Life Cycle All projects go through predictable stages called a project life cycle. A project life cycle is the series of phases that a project goes through from its initiation to its closure. 3 An

organization needs the assurance that the work of the project is proceeding in a satisfac- tory manner, that the results are aligned with the original plan, and they are likely to serve the customer s intended purpose. The project customer is the person or organization that will use the project s product, service, or result. Customers can be internal to the organiza- tion (that is, part of the company performing the project) or external to the organization.

Many different project life cycle models are used for different types of projects, such as information systems, improvement, research and development, and construction. The variations these pose will be explored in Chapter 4. In this book, we will use the follow- ing project stages:

Selecting and initiating starts when an idea for a project first emerges and the proj- ect is selected and planned at a high level, and ends when key participants commit to it in broad terms.

Chapter 1 Introduction to Project Management 7

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AGILE

Planning starts after the initial commitment, includes detailed planning, and ends when all stakeholders accept the entire detailed plan. Executing starts when the plan is accepted, and includes authorizing, executing, monitoring, and controlling work until the customer accepts the project deliverables. Closing and realizing includes all activities after customer acceptance to ensure the project is completed, lessons are learned, resources are reassigned, contributions are recognized, and benefits are realized.

The pace of work and amount of money spent may vary considerably from one life cycle stage to another. Often, the selecting is performed periodically for all projects at a division or corporate level, and then initiating is rather quick just enough to ensure that a project makes sense and key participants will commit to it. The plan- ning stage can become rather detailed and will normally require quite a bit more work. The execution stage or stages are the time when the majority of the hands-on project tasks are accomplished. This tends to be a time of considerable work. Closing is a time when loose ends are tied up and the work level decreases significantly, but realizing benefits from the project occurs over time, may be measured months after project completion, and may be done by people other than those who performed the project. Occasionally, some of these phases overlap with each other, depending on the project complexity, urgency of the deliverable, and ambiguity associated with the project scope.

See Exhibit 1.1 for a predictive or plan-driven project life cycle and Exhibit 1.2 for an adaptive or change-driven project life cycle. The primary difference is that in the first, the product is well understood and all planning precedes all executing, while in the second, early results lead into planning later work. The extreme of pre- dictive is sometimes called waterfall and the extreme of adaptive is sometimes called Agile.

EXHIBIT 1.1

PREDICTIVE OR PLAN-DRIVEN PROJECT LIFE CYCLE WITH MEASUREMENT POINTS

Other Approvals

Closing & Realizing

Administrative Closure

Bene�ts Measures

Level of Effort

Stage

Stage Ending Gates

Selecting & Initiating

Charter

Selection

Planning

Kickoff

Executing

Project Result

Progress Reports

8 Part 1 Organizing Projects

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Three other points should be made concerning the project life cycle. First, most com- panies with well-developed project management systems insist that a project must pass an approval of some kind to move from one stage to the next.4 In both exhibits, the approval to move from selecting and initiating to planning, for instance, is the approval of a charter. Second, in some industries, the project life cycle is highly formalized and very specific. For example, in the construction industry, the executing stage is often described as the three stages of design, erection, and finishing. Third, many companies even have their own project life cycle model, such as the one Midland Insurance Com- pany has developed for quality improvement projects, as shown in Exhibit 1.3.

EXHIBIT 1.3

MIDLAND INSURANCE COMPANY PROJECT LIFE CYCLE FOR QUALITY IMPROVEMENT PROJECTS

Initiation Planning Execution Close Out

1) De ne Problem

2) Factually Describe Situation

3) Analyze Causes

4) Solution Planning and Implementation

5) Evaluation of Effects

6) Sustain Results

7) Share Results

Source: Martin J. Novakov, American Modern Insurance Group.

EXHIBIT 1.2

ADAPTIVE OR CHANGE-DRIVEN PROJECT LIFE CYCLE WITH MEASUREMENT POINTS

Other Approvals

Closing & Realizing

Administrative Closure

Bene�ts Measures

Level of Effort

Stage

Stage Ending Gates

Selecting & Initiating

Charter

Selection

Planning Executing

Planning Executing

· · ·

Interim Result

Interim Result

Project Result

Chapter 1 Introduction to Project Management 9

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This book will present examples of company-specific life cycle models, but for clarity will use the predictive or plan-driven model shown in Exhibit 1.1 when describing con- cepts, except when we discuss Agile with the adaptive or change-driven model. In addi- tion to stage-ending approvals, frequently projects are measured at additional points such as selection, progress reporting, and benefits realization, as shown in Exhibit 1.1.

1-4 Understanding Projects Several frameworks that can help a person better understand project management are described below: the Project Management Institute (PMI); the Project Management Body of Knowledge (PMBOK® Guide); methods of selecting and prioritizing projects, project goals and constraints; project success and failure; use of Microsoft Project to help plan and measure projects, and various ways to classify projects.

1-4a Project Management Institute Project management has professional organizations just as do many other professions and industry groups. The biggest of these by far is the Project Management Institute.

The Project Management Institute was founded in 1969, grew at a modest pace until the early 1990s, and has grown quite rapidly since then. As of February 2017, PMI had well over 475,000 members. PMI publishes and regularly updates over a dozen exten- sions, guides, and standards. The best known is A Guide to the Project Management Body of Knowledge (PMBOK® Guide). Definitions in this book that have specific nuances come from the most current edition of PMI standards and guides. Those definitions that are common knowledge are defined in typical terms. PMI has established eight profes- sional certifications, with the most popular being Project Management Professional (PMP)®. Currently, over 650,000 people hold the PMP® certification. To be certified as a PMP®, a person needs to have the required experience and education, pass an exami- nation on the PMBOK® Guide, and sign and be bound by a code of professional con- duct. PMI has also established a second certification Certified Associate in Project Management (CAPM) that is geared toward junior people working on projects before they are eligible to become PMPs. PMI also has established six additional credentials plus multiple practice standards and extensions to the PMBOK® Guide in areas such as pro- gram management, Agile, risk, scheduling, resource estimating, work breakdown struc- tures, earned value management, construction, and government.5

1-4b Project Management Body of Knowledge (PMBOK®) A Guide to the Project Management Body of Knowledge®, known as PMBOK®, consists ofthree introductory chapters covered collectively in Chapters 1, 2, and 3 of this book; five process groups; 10 knowledge areas; and 49 processes. A project management process group is a logical grouping of the project management processes to achieve specific project objectives. 6 The five process groups, paraphrased from the PMBOK® Guide, are as follows: 1. Initiating define a project or a new phase by obtaining authorization 2. Planning establish the project scope, refine objectives, and define plans and actions

to attain objectives 3. Executing complete the work defined to satisfy project specifications 4. Monitoring and controlling track, review, and regulate progress and performance,

identify changes required, and initiate changes 5. Closing formally complete or close project or phase 7

10 Part 1 Organizing Projects

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The 10 knowledge areas, paraphrased from the PMBOK® Guide, are as follows: 1. Integration management processes and activities to identify, define, combine,

unify, and coordinate the various processes and project management activities 2. Scope management processes to ensure that the project includes all the work

required, and only the work required, to complete the project successfully 3. Schedule management processes to manage timely completion of the project 4. Cost management processes involved in planning, estimating, budgeting, financ-

ing, funding, managing, and controlling costs so that the project can be completed within the approved budget

5. Quality management processes to incorporate the organization s quality policy regarding planning, managing, and controlling quality requirements to meet stake- holder expectations

6. Resource management processes to identify, acquire, and manage resources needed to successfully complete the project

7. Communications management processes to ensure timely and appropriate plan- ning, collection, creation, distribution, storage, retrieval, management, control, mon- itoring, and ultimate disposition of project information

8. Risk management processes of conducting risk management planning, identifica- tion, analysis, response planning, response implementation, and monitoring risk on a project

9. Procurement management processes to purchase or acquire products, services, or results from outside the project team

10. Stakeholder management processes to identify the people, groups, or organizations, that could impact or be impacted by the project, analyze their expectations and impact, and develop strategies for engaging them in project decisions and execution 8

Project Processes There are 49 individual project work processes that are each in a process group and a knowledge area. Exhibit 1.4 shows the general flow of when each process occurs during a project if one reads the chart from left to right. For example, the first two processes are to develop the project charter and identify stakeholders. Both occur during project initiation. The charter development is part of integration manage- ment, while stakeholder identification is part of stakeholder management. These pro- cesses flow from one into another, as shown in the more complete flowchart in the inside back cover of the text. These processes use inputs and create outputs. Many of the outputs are project charts and tools that are used to plan and control the project, as also shown on that complete flowchart. Other outputs are deliverables. A deliverable is any unique and verifiable product, result, or capability to perform a service that is produced to complete a process, phase, or project.9

One should remember that all these processes might not be required for all projects. These PMBOK processes are designed to be all-inclusive and are meant for large and complex projects.

1-4c The PMI Talent Triangle PMI research shows that to be a successful project manager, a person needs to develop knowledge and skills in technical areas, leadership, and strategic business management. The objectives in this book are grouped first with those core skills and knowledge that all project management classes would typically cover. Core objectives are those the authors firmly believe anyone who takes a course in project management should master. The core objectives include those that the Talent Triangle classifies as technical,

Chapter 1 Introduction to Project Management 11

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EXHIBIT 1.4

FLOWCHART OF PMBOK PROCESSES AND MAJOR OUTPUTS

13.1 Identify Stakeholders

INITIATINGKNOWLEDGE AREAS

Integration

Scope

Schedule

Cost

Quality

Resources

Communication

Risk

Procurement

Stakeholders

12.1 Plan Procurement Management

11.1 Plan Risk

Management

10.1 Plan Communications

Management

9.1 Plan Resource

Management

8.1 Plan Quality

Management

7.1 Plan Cost

Management

6.1 Plan Schedule

Management

5.1 Plan Scope

Management

Flowchart of PMBOK Processes and Major Deliverables

4.1 Develop Project Charter

6.5 Develop Schedule

5.2 Collect Requirements

5.4 Create WBS

5.3 De�ne Scope

PLANNING

4.2 Develop Project Management Plan

6.2 De�ne Activities

9.2 Estimate Activity

Resources

11.2 Identify Risks

11.3 Perform Qualitative

Risk Analysis

11.4 Perform Quantitative Risk Analysis

11.5 Plan Risk

Responses

13.2 Plan Stakeholders Engagement

6.4 Estimate activity

Durations

7.3 Determine Budget

7.2 Estimate Costs

6.3 Sequence Activities

Section 1.2 Foundational Elements

2.4 Organizational Systems 3.3 The Project Manager’s Sphere of In�uence 3.4 Project Manager Competencies Selecting Projects

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11.6 Implement Risk Responses

13.3 Manage Stakeholder Engagement

13.4 Monitor Stakeholder Engagement

EXECUTING MONITORING & CONTROLLING CLOSING

4.3 Direct and Manage Project Work

4.4 Manage Project Knowledge

4.7 Close Project or Phase

6.6 Control Schedule

7.4 Control Costs

5.6 Control Scope

5.5 Validate Scope

8.2 Manage Quality

9.3 Acquire Resources

9.4 Develop Team

9.6 Control Resources

9.5 Manage Team

8.3 Control Quality

10.2 Manage Communications

11.7 Monitor Risks

10.3 Monitor Communications

12.2 Conduct Procurements

12.3 Control Procurements

4.6 Perform Integrated

Change Control

4.5 Monitor and Control

Project Work

KNOWLEDGE AREAS

Integration

Scope

Schedule

Cost

Quality

Resources

Communication

Risk

Procurement

Stakeholders

Bene�ts Analysis

Realizing Bene�ts

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behavioral, and strategic. More advanced technical objectives appear in some chapters for professors who wish to teach with a technical approach. More advanced behavioral objectives are also included in some chapters for professors who wish to emphasize the behavioral/leadership aspects of project management.

1-4d Selecting and Prioritizing Projects During the selecting and initiating stage of a project, one of the first tasks leaders must do is to identify potential projects. Ideally, this is accomplished in a systematic manner not just by chance. Some opportunities will present themselves. Other good opportunities need to be dis- covered. All parts of the organization should be involved. For example, salespeople can uncover opportunities through open discussions with existing and potential customers. Opera- tions staff members may identify potential productivity-enhancing projects. Everyone in the firm should be aware of industry trends and use this knowledge to identify potential projects.

Potential projects are identified based on business needs such as capability enhance- ment, new business opportunities, contractual obligations, changes in strategic direction, innovative business ideas, replacing obsolete equipment, or adopting new technology.

Once identified, organizations need to prioritize among the potential projects. The best way to do this is to determine which projects align best with the major goals of the firm. The executives in charge of selecting projects need to ensure overall organizational priori- ties are understood, communicated, and accepted. Once this common understanding is in place, it is easier to prioritize among the potential projects. The degree of formality used in selecting projects varies widely. Regardless of the company s size and the level of formality used, the prioritization efforts should include asking the following questions:

What value does each potential project bring to the organization? Are the demands of performing each project understood? Are the resources needed to perform the project available? Is there enthusiastic support both from the external customers and from one or more internal champions? Which projects will best help the organization achieve its goals?

One of the popular decision tools used to select projects is an evaluation model based on selection criteria; these selection criteria, in turn, are based on project attributes, orga- nizational indices, financial performance attributes, and strategic goals. More sophisticated tools like decision trees, analytical hierarchical process (AHP), expected net present value, and other economic evaluation models are sometimes used for project selection.

1-4e Project Goals and Constraints All projects should be undertaken to accomplish specific goals. Those goals can be described both by scope and by quality. Scope is a combination of product scope and project scope. Product scope is the entirety of what will be present in the actual project deliverables. Project scope is the entirety of what will and will not be done to meet the specified require- ments. Quality is the characteristics of a product or service that bear on its ability to satisfy stated or implied needs. 10 Taken together, scope and quality are often called performance and should result in outputs that customers can be satisfied with as they use them to effectively do their job. From a client perspective, projects generally have time and cost constraints. Thus, a project manager needs to be concerned with achieving desired scope and quality, subject to constraints of time and cost. If the project were to proceed exactly according to plan, it would be on time, on budget, and with the agreed-upon scope and the agreed-upon quality.

14 Part 1 Organizing Projects

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AGILE

However, many things can happen as a project is conducted. Obstacles or challenges that may limit the ability to perform often arise, as do opportunities to exceed original expecta- tions. A project manager needs to understand which of these four goals and constraints (scope, quality, time, budget) should take precedence and which can be sacrificed. The proj- ect manager needs to help the customer articulate how much he wants to enhance achieve- ment of one of these four dimensions. The customer must also state which dimension he is willing to sacrifice, by how much, and under what circumstances to receive better achieve- ment of the other one. For example, on a research and development (R&D) project, a cus- tomer may be willing to pay an extra $5,000 to finish the project 10 days early. On a church construction project, a customer may be willing to give up five extra light switches in exchange for greater confidence that the light system will work properly. Understanding the customer s desires in this manner enables a project manager to make good project deci- sions. A project manager can use a project customer trade-off matrix such as the one in Exhibit 1.5 to reflect the research and development project trade-offs discussed above.

In addition, project plans undergo changes due to uncertainties and unknowns asso- ciated with the project. These changes must be assessed for their impact on cost and duration of the project before implementing them.

From an internal perspective, a project manager also needs to consider two more constraints: the amount of resources available and the decision maker s risk tolerance.

From an Agile perspective, in a given iteration, resources (including cost) and schedule are considered fixed and what can vary is value to the customer.

1-4f Defining Project Success and Failure Project success is creating deliverables that include all of the agreed-upon features (meet scope goals). The outputs should satisfy all specifications and please the project s custo- mers. The customers need to be able to use the outputs effectively as they do their work (meet quality goals). The project should be completed on schedule and on budget (meet time and cost constraints).

Project success also includes other considerations. A successful project is one that is completed without heroics that is, people should not burn themselves out to complete the project. Those people who work on the project should learn new skills and/or refine existing skills. Organizational learning should take place and be captured for future projects. Finally, the performing organization should reap business-level benefits such as development of

EXHIBIT 1.5

PROJECT CUSTOMER TRADE-OFF MATRIX

ENHANCE MEET SACRIFICE

Cost Pay up to $5,000 extra if it saves 10 days

Schedule Save up to 10 days

Quality Must meet

Scope Must meet

Source: Adapted from Timothy J. Kloppenborg and Joseph A. Petrick, Managing Project Qualify (Vienna, VA: Management Concepts, 2002): 46.

Chapter 1 Introduction to Project Management 15

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new products, increased market share, increased profitability, decreased cost, and so on. A contemporary and complete view of project success is shown in Exhibit 1.6.

Project failure can be described as not meeting the success criteria listed in Exhibit 1.6. Many projects are fully successful in some ways but less successful in other aspects. The goal of excellent project management is to reach high levels of success on all mea- sures on all projects. Serious project failure when some of the success criteria are missed by a large amount and/or when several of the success criteria are missed can be attributed to numerous causes. In each chapter of this textbook, more specific possible failure causes will be covered, along with how to avoid them, but some basic causes of failure are as follows:

Incomplete or unclear requirements Inadequate user involvement Inadequate resources Unrealistic time demands Unclear or unrealistic expectations Inadequate executive support Changing requirements Inadequate planning

1-4g Using Microsoft Project to Help Plan and Measure Projects A useful tool to capture and conveniently display a variety of important project data is Microsoft® (MS) Project. MS Project is demonstrated in a step-by-step fashion using screen shots from a single integrated project throughout the book. If you re using the MindTap prod- uct for this book, you have access to short videos demonstrating how to use the software.

1-4h Types of Projects Four ways to classify projects that help people understand the unique needs of each are by industry, size, understanding of project scope, and application.

CLASSIFYING BY INDUSTRY Projects can be classified in a variety of ways. One method is by industry, which is useful in that projects in different industries often have unique requirements. Several industry-specific project life cycle models are in use, and various trade groups and special interest groups can provide guidance.