Project management

Project management is the discipline of initiating, planning, executing, controlling, and closing
the work of a team to achieve specific goals and meet specific success criteria. A project is a
temporary endeavor designed to produce a unique product, service or result with a defined
beginning and end (usually time-constrained, and often constrained by funding or deliverables)
undertaken to meet unique goals and objectives, typically to bring about beneficial change or added
value. The temporary nature of projects stands in contrast with business as usual (or
operations), which are repetitive, permanent, or semi-permanent functional activities to produce
products or services. In practice, the management of these two systems is often quite different, and
as such requires the development of distinct technical skills and management strategies.
The primary challenge of project management is to achieve all of the project goals within the given
constraints. This information is usually described in a user or project manual, which is created at the
beginning of the development process. The primary constraints are scope,
time, quality and budget. The secondary — and more ambitious — challenge is
to optimize the allocation of necessary inputs and integrate them to meet pre-defined objectives.

History

Roman soldiers building a fortress, Trajan's Column 113 AD

Until 1900, civil engineering projects were generally managed by creative architects, engineers,
and master builders themselves, for example, Vitruvius (first century BC), Christopher Wren (1632–
1723), Thomas Telford (1757–1834) and Isambard Kingdom Brunel (1806–1859).[7] In the 1950s
organizations started to systematically apply project-management tools and techniques to complex
engineering projects.

Henry Gantt (1861–1919), the father of planning and control techniques

As a discipline, project management developed from several fields of application including civil
construction, engineering, and heavy defense activity. Two forefathers of project management
are Henry Gantt, called the father of planning and control techniques, who is famous for his use of
the Gantt chart as a project management tool (alternatively Harmonogram first proposed by Karol
Adamiecki; and Henri Fayol for his creation of the five management functions that form the
foundation of the body of knowledge associated with project and program management. Both Gantt
and Fayol were students of Frederick Winslow Taylor's theories of scientific management. His work
is the forerunner to modern project management tools including work breakdown structure (WBS)
and resource allocation.
The 1950s marked the beginning of the modern project management era where core engineering
fields come together to work as one. Project management became recognized as a distinct discipline
arising from the management discipline with engineering model. In the United States, prior to the
1950s, projects were managed on an ad-hoc basis, using mostly Gantt charts and informal
techniques and tools. At that time, two mathematical project-scheduling models were developed.
The "Critical Path Method" (CPM) was developed as a joint venture between DuPont
Corporation and Remington Rand Corporation for managing plant maintenance projects. The
"Program Evaluation and Review Technique" or PERT, was developed by the United States Navy in
conjunction with the Lockheed Corporation and Booz Allen Hamilton as part of the Polaris
missile submarine program.
PERT and CPM are very similar in their approach but still present some differences. CPM is used for
projects that assume deterministic activity times; the times at which each activity will be carried out
are known. PERT, on the other hand, allows for stochastic activity times; the times at which each
activity will be carried out are uncertain or varied. Because of this core difference, CPM and PERT
are used in different contexts. These mathematical techniques quickly spread into many private
enterprises.

PERT network chart for a seven-month project with five milestones

At the same time, as project-scheduling models were being developed, technology for project
cost estimating, cost management and engineering economics was evolving, with pioneering work
by Hans Lang and others. In 1956, the American Association of Cost Engineers (now AACE
International; the Association for the Advancement of Cost Engineering) was formed by early
practitioners of project management and the associated specialties of planning and scheduling, cost
estimating, and cost/schedule control (project control). AACE continued its pioneering work and in
2006 released the first integrated process for portfolio, program and project management (Total Cost
Management Framework).
The International Project Management Association (IPMA) was founded in Europe in 1967, as a
federation of several national project management associations. IPMA maintains its federal structure
today and now includes member associations on every continent except Antarctica. IPMA offers a
Four Level Certification program based on the IPMA Competence Baseline (ICB). The ICB covers
technical, contextual, and behavioral competencies.
In 1969, the Project Management Institute (PMI) was formed in the USA. PMI publishes A Guide to
the Project Management Body of Knowledge (PMBOK Guide), which describes project management
practices that are common to "most projects, most of the time." PMI also offers multiple certifications.

Approaches
There are a number of approaches for managing project activities including lean, iterative,
incremental, and phased approaches.
Regardless of the methodology employed, careful consideration must be given to the overall project
objectives, timeline, and cost, as well as the roles and responsibilities of all participants
and stakeholders.
The traditional approach
A traditional phased approach identifies a sequence of steps to be completed. In the "traditional
approach", five developmental components of a project can be distinguished (four stages plus
control):

Typical development phases of an engineering project

1. initiation
2. planning and design
3. execution and construction
4. monitoring and controlling systems
5. completion or closing
Many industries use variations of these project stages and it is not uncommon for the stages to be
renamed in order to better suit the organization. For example, when working on a brick-and-
mortar design and construction, projects will typically progress through stages like pre-planning,
conceptual design, schematic design, design development, construction drawings (or contract
documents), and construction administration. In software development, this approach is often known
as the waterfall model,[19] i.e., one series of tasks after another in linear sequence. In software
development many organizations have adapted the Rational Unified Process (RUP) to fit this
methodology, although RUP does not require or explicitly recommend this practice. Waterfall
development works well for small, well-defined projects, but often fails in larger projects of undefined
and ambiguous nature. The Cone of Uncertainty explains some of this as the planning made on the
initial phase of the project suffers from a high degree of uncertainty. This becomes especially true as
software development is often the realization of a new or novel product. In projects
where requirements have not been finalized and can change, requirements management is used to
develop an accurate and complete definition of the behavior of software that can serve as the basis
for software development.[20] While the terms may differ from industry to industry, the actual stages
typically follow common steps to problem solving—"defining the problem, weighing options, choosing
a path, implementation and evaluation.
PRINCE2
Main article: PRINCE2

The PRINCE2 process model

PRINCE2 is a structured approach to project management released in 1996 as a generic project

management method. It combines the original PROMPT methodology (which evolved into the
PRINCE methodology) with IBM's MITP (managing the implementation of the total project)
methodology. PRINCE2 provides a method for managing projects within a clearly defined
framework.
PRINCE2 focuses on the definition and delivery of products, in particular their quality requirements.
As such, it defines a successful project as being output-oriented (not activity- or task-oriented)
through creating an agreed set of products that define the scope of the project and provides the
basis for planning and control, that is, how then to coordinate people and activities, how to design
and supervise product delivery, and what to do if products and therefore the scope of the project has
to be adjusted if it does not develop as planned.
In the method, each process is specified with its key inputs and outputs and with specific goals and
activities to be carried out to deliver a project's outcomes as defined by its Business Case. This
allows for continuous assessment and adjustment when deviation from the Business Case is
required.
PRINCE2 provides a common language for all participants in the project. The governance
framework of PRINCE2 – its roles and responsibilities – are fully described and require tailoring to
suit the complexity of the project and skills of the organization.
Critical chain project management
Main article: Critical chain project management
Critical chain project management (CCPM) is a method of planning and managing project execution
designed to deal with uncertainties inherent in managing projects, while taking into consideration
limited availability of resources (physical, human skills, as well as management & support capacity)
needed to execute projects.
CCPM is an application of the theory of constraints (TOC) to projects. The goal is to increase the
flow of projects in an organization (throughput). Applying the first three of the five focusing steps of
TOC, the system constraint for all projects, as well as the resources, are identified. To exploit the
constraint, tasks on the critical chain are given priority over all other activities. Finally, projects are
planned and managed to ensure that the resources are ready when the critical chain tasks must
start, subordinating all other resources to the critical chain.
The project plan should typically undergo resource leveling, and the longest sequence of resource-
constrained tasks should be identified as the critical chain. In some cases, such as managing
contracted sub-projects, it is advisable to use a simplified approach without resource leveling.
In multi-project environments, resource leveling should be performed across projects. However, it is
often enough to identify (or simply select) a single "drum". The drum can be a resource that acts as
a constraint across projects, which are staggered based on the availability of that single resource.
One can also use a "virtual drum" by selecting a task or group of tasks (typically integration points)
and limiting the number of projects in execution at that stage.
Process-based management
Main article: Process-based management
The incorporation of process-based management has been driven by the use of Maturity models
such as the OPM3 and the CMMI (capability maturity model integration; see this example of a
predecessor) and ISO/IEC15504 (SPICE – software process improvement and capability
estimation). Unlike SEI's CMM, the OPM3 maturity model describes how to make project
management processes capable of performing successfully, consistently, and predictably in order to
enact the strategies of an organization .
Lean project management
Main article: Lean project management
Lean project management uses the principles from lean manufacturing to focus on delivering value
with less waste and reduced time.
Project Production Management (PPM)
Main article: Project Production Management
Project Production Management uses principles from operations research, industrial engineering
and queuing theory to organize work activities in major capital projects to optimize project delivery.
Extreme project management/Megaproject
Main articles: Extreme project management and Megaproject

Planning and feedback loops in Extreme programming (XP) with the time frames of the multiple loops.

In critical studies of project management it has been noted that several PERT based models are not
well suited for the multi-project company environment of today. Most of them are aimed at very
large-scale, one-time, non-routine projects, and currently all kinds of management are expressed in
terms of projects.
Using complex models for "projects" (or rather "tasks") spanning a few weeks has been proven to
cause unnecessary costs and low maneuverability in several cases. The generalization of Extreme
Programming to other kinds of projects is extreme project management, which may be used in
combination with the process modeling and management principles of human interaction
management.
Benefits realization management
Main article: Benefits realisation management
Benefits realization management (BRM) enhances normal project management techniques through
a focus on outcomes (the benefits) of a project rather than products or outputs, and then measuring
the degree to which that is happening to keep a project on track. This can help to reduce the risk of a
completed project being a failure by delivering agreed upon requirements/outputs but failing to
deliver the benefits of those requirements.
In addition, BRM practices aim to ensure the alignment between project outcomes and business
strategies. The effectiveness of these practices is supported by recent research evidencing BRM
practices influencing project success from a strategic perspective across different countries and
industries.
An example of delivering a project to requirements might be agreeing to deliver a computer system
that will process staff data and manage payroll, holiday and staff personnel records. Under BRM the
agreement might be to achieve a specified reduction in staff hours required to process and maintain
staff data.

Process groups

The project development stages

Traditionally (depending on what project management methodology is being used), project

management includes a number of elements: four to five project management process groups, and a
control system. Regardless of the methodology or terminology used, the same basic project
management processes or stages of development will be used. Major process groups generally
include:

 Initiation
 Planning
 Production or execution
 Monitoring and controlling
 Closing
In project environments with a significant exploratory element (e.g., research and development),
these stages may be supplemented with decision points (go/no go decisions) at which the project's
continuation is debated and decided. An example is the Phase–gate model.
Initiating

Initiating process group processes

The initiating processes determine the nature and scope of the project. If this stage is not performed
well, it is unlikely that the project will be successful in meeting the business’ needs. The key project
controls needed here are an understanding of the business environment and making sure that all
necessary controls are incorporated into the project. Any deficiencies should be reported and a
recommendation should be made to fix them.
The initiating stage should include a plan that encompasses the following areas:

 analyzing the business needs/requirements in measurable goals

 reviewing of the current operations
 financial analysis of the costs and benefits including a budget
 stakeholder analysis, including users, and support personnel for the project
 project charter including costs, tasks, deliverables, and schedules
 SWOT analysis strengths, weaknesses, opportunities, and threats to the business
Planning
After the initiation stage, the project is planned to an appropriate level of detail (see example of a
flow-chart). The main purpose is to plan time, cost and resources adequately to estimate the work
needed and to effectively manage risk during project execution. As with the Initiation process group,
a failure to adequately plan greatly reduces the project's chances of successfully accomplishing its
goals.
Project planning generally consists of

 determining how to plan (e.g. by level of detail or Rolling Wave planning);

 developing the scope statement;
 selecting the planning team;
 identifying deliverables and creating the work breakdown structure;
 identifying the activities needed to complete those deliverables and networking the activities
in their logical sequence;
 estimating the resource requirements for the activities;
 estimating time and cost for activities;
 developing the schedule;
 developing the budget;
 risk planning;
 developing quality assurance measures;
 gaining formal approval to begin work.
Additional processes, such as planning for communications and for scope management, identifying
roles and responsibilities, determining what to purchase for the project and holding a kick-off
meeting are also generally advisable.
For new product development projects, conceptual design of the operation of the final product may
be performed concurrent with the project planning activities, and may help to inform the planning
team when identifying deliverables and planning activities.

Executing

Executing process group processes

The execution/implementation phase ensures that the project management plan's deliverables are
executed accordingly. This phase involves proper allocation, co-ordination and management of
human resources and any other resources such as material and budgets. The output of this phase is
the project deliverables.
Monitoring and controlling

Monitoring and controlling process group processes

Monitoring and controlling consists of those processes performed to observe project execution so
that potential problems can be identified in a timely manner and corrective action can be taken,
when necessary, to control the execution of the project. The key benefit is that project performance
is observed and measured regularly to identify variances from the project management plan.
Monitoring and controlling includes:

 Measuring the ongoing project activities ('where we are');

 Monitoring the project variables (cost, effort, scope, etc.) against the project management
plan and the project performance baseline (where we should be);
 Identifying corrective actions to address issues and risks properly (How can we get on track
again);
 Influencing the factors that could circumvent integrated change control so only approved
changes are implemented.
In multi-phase projects, the monitoring and control process also provides feedback between project
phases, in order to implement corrective or preventive actions to bring the project into compliance
with the project management plan.
Project maintenance is an ongoing process, and it includes:

 Continuing support of end-users

 Correction of errors
 Updates to the product over time

Monitoring and controlling cycle

In this stage, auditors should pay attention to how effectively and quickly user problems are
resolved.
Over the course of any construction project, the work scope may change. Change is a normal and
expected part of the construction process. Changes can be the result of necessary design
modifications, differing site conditions, material availability, contractor-requested changes, value
engineering and impacts from third parties, to name a few. Beyond executing the change in the field,
the change normally needs to be documented to show what was actually constructed. This is
referred to as change management. Hence, the owner usually requires a final record to show all
changes or, more specifically, any change that modifies the tangible portions of the finished work.
The record is made on the contract documents – usually, but not necessarily limited to, the design
drawings. The end product of this effort is what the industry terms as-built drawings, or more simply,
"as built." The requirement for providing them is a norm in construction contracts. Construction
document management is a highly important task undertaken with the aid an online or desktop
software system, or maintained through physical documentation. The increasing legality pertaining to
the construction industries maintenance of correct documentation has caused the increase in the
need for document management systems.
When changes are introduced to the project, the viability of the project has to be re-assessed. It is
important not to lose sight of the initial goals and targets of the projects. When the changes
accumulate, the forecasted result may not justify the original proposed investment in the project.
Successful project management identifies these components, and tracks and monitors progress so
as to stay within time and budget frames already outlined at the commencement of the project.
Closing
Closing process group processes.

Closing includes the formal acceptance of the project and the ending thereof. Administrative
activities include the archiving of the files and documenting lessons learned.
This phase consists of:

 Contract closure: Complete and settle each contract (including the resolution of any open
items) and close each contract applicable to the project or project phase.
 Project close: Finalize all activities across all of the process groups to formally close the
project or a project phase
Also included in this phase is the Post Implementation Review. This is a vital phase of the project for
the project team to learn from experiences and apply to future projects. Normally a Post
Implementation Review consists of looking at things that went well and analyzing things that went
badly on the project to come up with lessons learned.
Project controlling and project control systems
Project controlling (also known as Cost Engineering) should be established as an independent
function in project management. It implements verification and controlling function during the
processing of a project in order to reinforce the defined performance and formal goals. The tasks of
project controlling are also:

 the creation of infrastructure for the supply of the right information and its update
 the establishment of a way to communicate disparities of project parameters
 the development of project information technology based on an intranet or the determination
of a project key performance indicator system (KPI)
 divergence analyses and generation of proposals for potential project regulations
 the establishment of methods to accomplish an appropriate project structure, project
workflow organization, project control and governance
 creation of transparency among the project parameters
Fulfillment and implementation of these tasks can be achieved by applying specific methods and
instruments of project controlling. The following methods of project controlling can be applied:

 investment analysis
 cost–benefit analysis
 value benefit analysis
 expert surveys
 simulation calculations
 risk-profile analysis
 surcharge calculations
 milestone trend analysis
 cost trend analysis
 target/actual-comparison
Project control is that element of a project that keeps it on track, on-time and within budget. Project
control begins early in the project with planning and ends late in the project with post-implementation
review, having a thorough involvement of each step in the process. Projects may be audited or
reviewed while the project is in progress. Formal audits are generally risk or compliance-based and
management will direct the objectives of the audit. An examination may include a comparison of
approved project management processes with how the project is actually being managed. [40] Each
project should be assessed for the appropriate level of control needed: too much control is too time
consuming, too little control is very risky. If project control is not implemented correctly, the cost to
the business should be clarified in terms of errors and fixes.
Control systems are needed for cost, risk, quality, communication, time, change, procurement, and
human resources. In addition, auditors should consider how important the projects are to
the financial statements, how reliant the stakeholders are on controls, and how many controls exist.
Auditors should review the development process and procedures for how they are implemented. The
process of development and the quality of the final product may also be assessed if needed or
requested. A business may want the auditing firm to be involved throughout the process to catch
problems earlier on so that they can be fixed more easily. An auditor can serve as a controls
consultant as part of the development team or as an independent auditor as part of an audit.
Businesses sometimes use formal systems development processes. These help assure systems are
developed successfully. A formal process is more effective in creating strong controls, and auditors
should review this process to confirm that it is well designed and is followed in practice. A good
formal systems development plan outlines:

 A strategy to align development with the organization's broader objectives

 Standards for new systems
 Project management policies for timing and budgeting
 Procedures describing the process
 Evaluation of quality of change

Topics
Project managers
A project manager is a professional in the field of project management. Project managers can have
the responsibility of the planning, execution, controlling, and closing of any project typically relating
to the construction industry, engineering, architecture, computing, and telecommunications. Many
other fields of production engineering, design engineering, and heavy industrial have project
managers.
A project manager is the person accountable for accomplishing the stated project objectives. Key
project management responsibilities include creating clear and attainable project objectives, building
the project requirements, and managing the triple constraint (now including more constraints and
calling it competing constraints) for projects, which is cost, time, and scope for the first three but
about three additional ones in current project management.
A project manager is often a client representative and has to determine and implement the exact
needs of the client, based on knowledge of the firm they are representing. The ability to adapt to the
various internal procedures of the contracting party, and to form close links with the nominated
representatives, is essential in ensuring that the key issues of cost, time, quality and above all, client
satisfaction, can be realized.
Project management types
Project management can apply to any project, but it is often tailored to accommodate the specific
needs of different and highly specialized industries. For example, the construction industry, which
focuses on the delivery of things like buildings, roads, and bridges, has developed its own
specialized form of project management that it refers to as construction project management and in
which project managers can become trained and certified. The information technology industry has
also evolved to develop its own form of project management that is referred to as IT project
management and which specializes in the delivery of technical assets and services that are required
to pass through various lifecycle phases such as planning, design, development, testing, and
deployment. Biotechnology project management focuses on the intricacies of biotechnology
research and development.
For each type of project management, project managers develop and utilize repeatable templates
that are specific to the industry they're dealing with. This allows project plans to become very
thorough and highly repeatable, with the specific intent to increase quality, lower delivery costs, and
lower time to deliver project results.

Risk management
Main article: Project risk management
The United States Department of Defense states; "Cost, Schedule, Performance, and Risk," are the
four elements through which Department of Defense acquisition professionals make trade-offs and
track program status. There are also international standards. Risk management applies proactive
identification (see tools) of future problems and understanding of their consequences
allowing predictive decisions about projects.
Work breakdown structure
Main article: Work breakdown structure
The work breakdown structure (WBS) is a tree structure that shows a subdivision of effort required to
achieve an objective—for example a program, project, and contract. The WBS may be hardware-,
product-, service-, or process-oriented (see an example in a NASA reporting structure (2001)).
A WBS can be developed by starting with the end objective and successively subdividing it into
manageable components in terms of size, duration, and responsibility (e.g., systems, subsystems,
components, tasks, sub-tasks, and work packages), which include all steps necessary to achieve the
objective.
The work breakdown structure provides a common framework for the natural development of the
overall planning and control of a contract and is the basis for dividing work into definable increments
from which the statement of work can be developed and technical, schedule, cost, and labor hour
reporting can be established. The work breakdown structure can be displayed in two forms, as a
table with subdivision of tasks or as an organisational chart.
Project portfolio management
Main article: Project portfolio management
An increasing number of organizations are using what is referred to as project portfolio
management (PPM) as a means of selecting the right projects and then using project management
techniques as the means for delivering the outcomes in the form of benefits to the performing private
or not-for-profit organization.
Project management software
Main articles: Project management software and Project management information system
Project management software is software used to help plan, organize, and manage resource pools,
develop resource estimates and implement plans. Depending on the sophistication of the software,
functionality may include estimation and planning, scheduling, cost control and budget
management, resource allocation, collaboration software, communication, decision-
making, workflow, risk, quality, documentation and/or administration systems.[48][49]
Virtual project management
Main article: Virtual team
Virtual program management (VPM) is management of a project done by a virtual team, though it
rarely may refer to a project implementing a virtual environment It is noted that managing a virtual
project is fundamentally different from managing traditional projects, combining concerns of
telecommuting and global collaboration (culture, timezones, language).