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Case study 6.3 johnson & rogers software engineering inc

06/01/2021 Client: saad24vbs Deadline: 7 Days

List of Cases by Chapter


Chapter 1 Development Projects in Lagos, Nigeria 2 “Throwing Good Money after Bad”: the BBC’s


Digital Media Initiative 10 MegaTech, Inc. 29 The IT Department at Hamelin Hospital 30 Disney’s Expedition Everest 31 Rescue of Chilean Miners 32


Chapter 2 Tesla’s $5 Billion Gamble 37 Electronic Arts and the Power of Strong Culture


in Design Teams 64 Rolls-Royce Corporation 67 Classic Case: Paradise Lost—The Xerox Alto 68 Project Task Estimation and the Culture of “Gotcha!” 69 Widgets ’R Us 70


Chapter 3 Project Selection Procedures: A Cross-Industry


Sampler 77 Project Selection and Screening at GE: The Tollgate


Process 97 Keflavik Paper Company 111 Project Selection at Nova Western, Inc. 112


Chapter 4 Leading by Example for the London Olympics—


Sir John Armitt 116 Dr. Elattuvalapil Sreedharan, India’s Project


Management Guru 126 The Challenge of Managing Internationally 133 In Search of Effective Project Managers 137 Finding the Emotional Intelligence to Be a Real Leader 137 Problems with John 138


Chapter 5 “We look like fools.”—Oregon’s Failed Rollout


of Its ObamacareWeb Site 145 Statements of Work: Then and Now 151 Defining a Project Work Package 163 Boeing’s Virtual Fence 172 California’s High-Speed Rail Project 173 Project Management at Dotcom.com 175 The Expeditionary Fighting Vehicle 176


Chapter 6 Engineers Without Borders: Project Teams Impacting


Lives 187 Tele-Immersion Technology Eases the Use of Virtual


Teams 203 Columbus Instruments 215 The Bean Counter and the Cowboy 216 Johnson & Rogers Software Engineering, Inc. 217


Chapter 7 The Building that Melted Cars 224 Bank of America Completely Misjudges Its Customers 230 Collapse of Shanghai Apartment Building 239 Classic Case: de Havilland’s Falling Comet 245 The Spanish Navy Pays Nearly $3 Billion for a Submarine


That Will Sink Like a Stone 248 Classic Case: Tacoma Narrows Suspension Bridge 249


Chapter 8 Sochi Olympics—What’s the Cost of National


Prestige? 257 The Hidden Costs of Infrastructure Projects—The Case


of Building Dams 286 Boston’s Central Artery/Tunnel Project 288


Chapter 9 After 20 Years and More Than $50 Billion, Oil is No Closer


to the Surface: The Caspian Kashagan Project 297


Chapter 10 Enlarging the Panama Canal 331 Project Scheduling at Blanque Cheque Construction (A) 360 Project Scheduling at Blanque Cheque Construction (B) 360


Chapter 11 Developing Projects Through Kickstarter—Do Delivery


Dates Mean Anything? 367 Eli Lilly Pharmaceuticals and Its Commitment to Critical


Chain Project Management 385 It’s an Agile World 396 Ramstein Products, Inc. 397


Chapter 12 Hong Kong Connects to the World’s Longest Natural


Gas Pipeline 401 The Problems of Multitasking 427


Chapter 13 New York City’s CityTime Project 432 Earned Value at Northrop Grumman 451 The IT Department at Kimble College 463 The Superconducting Supercollider 464 Boeing’s 787 Dreamliner: Failure to Launch 465


Chapter 14 Duke Energy and Its Cancelled Levy County Nuclear


Power Plant 478 Aftermath of a “Feeding Frenzy”: Dubai and Cancelled


Construction Projects 490 New Jersey Kills Hudson River Tunnel Project 497 The Project That Wouldn’t Die 499 The Navy Scraps Development of Its Showpiece


Warship—Until the Next Bad Idea 500


Project ManageMent achieving coMPetitive advantage


Jeffrey K. Pinto Pennsylvania State University


Boston Columbus Indianapolis New York San Francisco Hoboken Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi


Mexico City São Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo


F o u r t h E d i t i o n


To Mary Beth, my wife, with the most profound thanks and love for her unwavering support. And, to our children, Emily, AJ, and Joseph—three “projects” that are definitely


over budget but that are performing far better than I could have hoped!


VP, Product Management: Donna Battista Editor-in-Chief: Stephanie Wall Acquisitions Editor: Dan Tylman Program Manager Team Lead: Ashley Santora Program Manager: Claudia Fernandes Editorial Assistant: Linda Albelli VP, Marketing: Maggie Moylan Product Marketing Manager: Anne Fahlgren Field Marketing Manager: Lenny Raper Strategic Marketing Manager: Erin Gardner Project Manager Team Lead: Judy Leale Project Manager: Nicole Suddeth Operations Specialist: Carol Melville Cover Designer: Lumina Datamatics, Inc Cover Photo: f11photo/Fotolia


VP, Director of Digital Strategy & Assessment: Paul Gentile Manager of Learning Applications: Paul Deluca Digital Editor: Brian Surette Digital Studio Manager: Diane Lombardo Digital Studio Project Manager: Robin Lazrus Digital Studio Project Manager: Alana Coles Digital Studio Project Manager: Monique Lawrence Digital Studio Project Manager: Regina DaSilva Full-Service Project Management and Composition: Integra Printer/Binder: Edwards Brothers Cover Printer: Phoenix Color/Hagerstown Text Font: 10/12 Palatino


Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on the appropriate page within text.


Microsoft and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published as part of the services for any purpose. All such documents and related graphics are provided “as is” without warranty of any kind. Microsoft and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all warranties and conditions of merchantability, whether express, implied or statutory, fitness for a particular purpose, title and non-infringement. In no event shall Microsoft and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from the services. The documents and related graphics contained herein could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Microsoft and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time. Partial screen shots may be viewed in full within the software version specified.


Microsoft® Windows®, and Microsoft Office® are registered trademarks of the Microsoft Corporation in the U.S.A. and other countries. This book is not sponsored or endorsed by or affiliated with the Microsoft Corporation.


Copyright © 2016, 2013, 2010, 2007 by Pearson Education, Inc. All rights reserved. Manufactured in the United States of America. This publication is protected by Copyright, and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise. For information regarding permissions, request forms and the appropriate contacts within the Pearson Education Global Rights & Permissions department, please visit www.pearsoned.com/permissions/.


Many of the designations by manufacturers and sellers to distinguish their products are claimed as trademarks. Where those designations appear in this book, and the publisher was aware of a trademark claim, the designations have been printed in initial caps or all caps.


Library of Congress Cataloging-in-Publication Data


Pinto, Jeffrey K. Project management : achieving competitive advantage/Jeffrey K. Pinto.—Fourth edition. pages cm Includes index. ISBN 978-0-13-379807-4 (alk. paper)—ISBN 0-13-379807-0 (alk. paper) 1. Project management. I. Title. HD69.P75P5498 2016 658.4'04—dc23 2014036595


10 9 8 7 6 5 4 3 2 1


ISBN 10: 0-13-379807-0 ISBN 13: 978-0-13-379807-4


http://www.pearsoned.com/permissions/

iii


BrIEF COnTEnTS


Preface xiii


Chapter 1 Introduction: Why Project Management? 1


Chapter 2 The Organizational Context: Strategy, Structure, and Culture 36


Chapter 3 Project Selection and Portfolio Management 76


Chapter 4 Leadership and the Project Manager 115


Chapter 5 Scope Management 144


Chapter 6 Project Team Building, Conflict, and Negotiation 186


Chapter 7 Risk Management 223


Chapter 8 Cost Estimation and Budgeting 256


Chapter 9 Project Scheduling: Networks, Duration Estimation, and Critical Path 296


Chapter 10 Project Scheduling: Lagging, Crashing, and Activity Networks 330


Chapter 11 Advanced Topics in Planning and Scheduling: Agile and Critical Chain 366


Chapter 12 Resource Management 400


Chapter 13 Project Evaluation and Control 431


Chapter 14 Project Closeout and Termination 477


Appendix A The Cumulative Standard Normal Distribution 509


Appendix B Tutorial for MS Project 2013 510


Appendix C Project Plan Template 520


Glossary 524


Company Index 534


Name Index 535


Subject Index 538


iv


COnTEnTS


Preface xiii


Chapter 1 IntroduCtIon: Why ProjeCt ManageMent? 1 Project Profile: Development Projects in Lagos, Nigeria 2


Introduction 4


1.1 What Is a Project? 5 General Project Characteristics 6


1.2 Why Are Projects Important? 9 Project Profile: “Throwing Good Money after Bad”: the BBC’s Digital


Media Initiative 10


1.3 Project Life Cycles 13 ◾ Box 1.1: Project Managers in Practice 15


1.4 Determinants of Project Success 16 ◾ Box 1.2: Project Management Research in Brief 19


1.5 Developing Project Management Maturity 19


1.6 Project Elements and Text Organization 23 Summary  27  •  Key Terms  29  •  Discussion Questions  29 •  Case Study 1.1 MegaTech, Inc.  29  •  Case Study 1.2 The IT  Department at Hamelin Hospital  30  •  Case Study 1.3 Disney’s Expedition  Everest  31  •  Case Study 1.4 Rescue of Chilean Miners  32  •  Internet  Exercises  33  •  PMP Certification Sample Questions  34  •  Notes  34


Chapter 2 the organIzatIonal Context: Strategy, StruCture, and Culture 36


Project Profile: Tesla’s $5 Billion Gamble 37


Introduction 38


2.1 Projects and Organizational Strategy 39


2.2 Stakeholder Management 41 Identifying Project Stakeholders 42 Managing Stakeholders 45


2.3 Organizational Structure 47


2.4 Forms of Organizational Structure 48 Functional Organizations 48 Project Organizations 50 Matrix Organizations 53 Moving to Heavyweight Project Organizations 55


◾ Box 2.1: Project Management Research in Brief 56


2.5 Project Management Offices 57


2.6 Organizational Culture 59 How Do Cultures Form? 61 Organizational Culture and Project Management 63 Project Profile: Electronic Arts and the Power of Strong Culture in Design Teams 64


Summary  65  •  Key Terms  67  •  Discussion Questions  67  •  Case Study 2.1 Rolls-Royce Corporation  67  •  Case Study 2.2 Classic Case: Paradise Lost—The Xerox Alto  68  •  Case Study 2.3 Project Task Estimation and the Culture of “Gotcha!”  69  •  Case Study 2.4 Widgets ’R Us 70 •  Internet Exercises  70  •  PMP Certification Sample Questions  70  •  Integrated Project—Building Your Project Plan  72  •  Notes  74


Contents v


Chapter 3 ProjeCt SeleCtIon and PortfolIo ManageMent 76 Project Profile: Project Selection Procedures: A Cross-Industry Sampler 77


Introduction 78


3.1 Project Selection 78


3.2 Approaches to Project Screening and Selection 80 Method One: Checklist Model 80 Method Two: Simplified Scoring Models 82 Limitations of Scoring Models 84 Method Three: The Analytical Hierarchy Process 84 Method Four: Profile Models 88


3.3 Financial Models 90 Payback Period 90 Net Present Value 92 Discounted Payback 94 Internal Rate of Return 94 Choosing a Project Selection Approach 96 Project Profile: Project Selection and Screening at GE: The Tollgate Process 97


3.4 Project Portfolio Management 98 Objectives and Initiatives 99 Developing a Proactive Portfolio 100 Keys to Successful Project Portfolio Management 103 Problems in Implementing Portfolio Management 104


Summary  105  •  Key Terms  106  •  Solved Problems  107  •  Discussion Questions  108  •  Problems  108  •  Case Study 3.1 Keflavik Paper Company  111  •  Case Study 3.2 Project Selection at Nova Western, Inc.  112  •  Internet Exercises  113  •  Notes  113


Chapter 4 leaderShIP and the ProjeCt Manager 115 Project Profile: Leading by Example for the London Olympics—Sir John Armitt 116


Introduction 117


4.1 Leaders Versus Managers 118


4.2 How the Project Manager Leads 119 Acquiring Project Resources 119 Motivating and Building Teams 120 Having a Vision and Fighting Fires 121 Communicating 121


◾ Box 4.1: Project Management Research in Brief 124


4.3 Traits of Effective Project Leaders 125 Conclusions about Project Leaders 126 Project Profile: Dr. Elattuvalapil Sreedharan, India’s Project Management Guru 126


4.4 Project Champions 127 Champions—Who Are They? 128 What Do Champions Do? 129 How to Make a Champion 130


4.5 The New Project Leadership 131 ◾ Box 4.2: Project Managers in Practice 132


Project Profile: The Challenge of Managing Internationally 133


4.6 Project Management Professionalism 134


vi Contents


Summary  135  •  Key Terms  136  •  Discussion Questions  136  •  Case Study 4.1 In Search of Effective Project Managers 137 •  Case Study 4.2 Finding the Emotional Intelligence to Be a Real Leader 137 •  Case Study 4.3 Problems with John  138  •  Internet Exercises  141 •  PMP Certification Sample Questions  141  •  Notes  142


Chapter 5 SCoPe ManageMent 144 Project Profile: “We look like fools.”—Oregon’s Failed Rollout of Its Obamacare


Web Site 145


Introduction 146


5.1 Conceptual Development 148 The Statement of Work 150 The Project Charter 151 Project Profile: Statements of Work: Then and Now 151


5.2 The Scope Statement 153 The Work Breakdown Structure 153 Purposes of the Work Breakdown Structure 154 The Organization Breakdown Structure 159 The Responsibility Assignment Matrix 160


5.3 Work Authorization 161 Project Profile: Defining a Project Work Package 163


5.4 Scope Reporting 164 ◾ Box 5.1: Project Management Research in Brief 165


5.5 Control Systems 167 Configuration Management 167


5.6 Project Closeout 169 Summary  170  •  Key Terms  171  •  Discussion Questions  171  •  Problems  172  •  Case Study 5.1 Boeing’s Virtual Fence 172 •  Case Study 5.2 California’s High-Speed Rail Project  173  •  Case Study 5.3 Project Management at Dotcom.com  175  •  Case Study 5.4 The Expeditionary Fighting Vehicle  176  •  Internet Exercises  178  •  PMP Certification Sample Questions  178  •  MS Project Exercises  179  •  Appendix 5.1: Sample Project Charter  180  •  Integrated Project— Developing the Work Breakdown Structure  182  •  Notes  184


Chapter 6 ProjeCt teaM BuIldIng, ConflICt, and negotIatIon 186 Project Profile: Engineers Without Borders: Project Teams Impacting Lives 187


Introduction 188


6.1 Building the Project Team 189 Identify Necessary Skill Sets 189 Identify People Who Match the Skills 189 Talk to Potential Team Members and Negotiate with Functional Heads 189 Build in Fallback Positions 191 Assemble the Team 191


6.2 Characteristics of Effective Project Teams 192 A Clear Sense of Mission 192 A Productive Interdependency 192 Cohesiveness 193 Trust 193 Enthusiasm 193 Results Orientation 194


Contents vii


6.3 Reasons Why Teams Fail 194 Poorly Developed or Unclear Goals 194 Poorly Defined Project Team Roles and Interdependencies 194 Lack of Project Team Motivation 195 Poor Communication 195 Poor Leadership 195 Turnover Among Project Team Members 196 Dysfunctional Behavior 196


6.4 Stages in Group Development 196 Stage One: Forming 197 Stage Two: Storming 197 Stage Three: Norming 198 Stage Four: Performing 198 Stage Five: Adjourning 198 Punctuated Equilibrium 198


6.5 Achieving Cross-Functional Cooperation 199 Superordinate Goals 199 Rules and Procedures 200 Physical Proximity 201 Accessibility 201 Outcomes of Cooperation: Task and Psychosocial Results 201


6.6 Virtual Project Teams 202 Project Profile: Tele-Immersion Technology Eases the Use


of Virtual Teams 203


6.7  Conflict Management  204 What Is Conflict? 205 Sources of Conflict 206 Methods for Resolving Conflict 208


6.8 Negotiation 209 Questions to Ask Prior to the Negotiation 209 Principled Negotiation 210 Invent Options for Mutual Gain 212 Insist on Using Objective Criteria 213


Summary  214  •  Key Terms  214  •  Discussion Questions  215  •  Case Study 6.1 Columbus Instruments  215  •  Case Study 6.2 The Bean Counter and the Cowboy  216  •  Case Study 6.3 Johnson & Rogers Software Engineering, Inc.  217  •  Exercise in Negotiation  219  •  Internet  Exercises  220  •  PMP Certification Sample Questions  220  •  Notes  221


Chapter 7 rISk ManageMent 223 Project Profile: The Building that Melted Cars 224


Introduction 225 ◾ Box 7.1: Project Managers in Practice 227


7.1 Risk Management: A Four-Stage Process 228 Risk Identification 228 Project Profile: Bank of America Completely Misjudges Its Customers 230


Risk Breakdown Structures 231 Analysis of Probability and Consequences 231 Risk Mitigation Strategies 234


viii Contents


Use of Contingency Reserves 236 Other Mitigation Strategies 237 Control and Documentation 237 Project Profile: Collapse of Shanghai Apartment Building 239


7.2 Project Risk Management: An Integrated Approach 241 Summary  243  •  Key Terms  244  •  Solved Problem  244  •  Discussion  Questions  244  •  Problems  244  •  Case Study 7.1 Classic Case: de Havilland’s Falling Comet  245  •  Case Study 7.2 The Spanish Navy Pays Nearly $3 Billion for a Submarine That Will Sink Like a Stone  248  •  Case Study 7.3 Classic Case: Tacoma Narrows Suspension Bridge  249  •  Internet  Exercises  251  •  PMP Certification Sample Questions  251  •  Integrated  Project—Project Risk Assessment  253  •  Notes  255


Chapter 8 CoSt eStIMatIon and BudgetIng 256 Project Profile: Sochi Olympics—What’s the Cost of National Prestige? 257

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