HW help for project management

Read the Casa De Paz Development Project case study found at the end of chapters 1 through 5, CPM 4e and answer the following questions in a paper formatted using a question-response format:

Question 1 (taken from Unit 3) – If you were the project manager, what expertise would you like from the sponsor, stakeholders, or core team members to create a milestone schedule with acceptance criteria?  Minimum 250 words.

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Question 2 (taken from Unit 5) – What would you want to see in a team charter (i.e., rules of engagement) for this development project?  Is this different (Agile environment) than other (Traditional – Suburban Homes) environments?  If so, how is it different?   Minimum 250 words.

Question 3 (taken from Unit 5) – List types of decisions that would need to be made and the appropriate person, group, or method for each, for example, individual team member, the collective team, scrum master, and/or product owner.

You will be assessed on content and mechanics.

Content (30 points/question):  The content must be based on the case study materials and reading assignments.  The PMBOK 6e and CPM 4e, along with other reputable resources can be used to supplement the responses through summarizing, paraphrasing and quoting those sources.  

Mechanics (10 points):  Each question response must be at at minimum 250 words.  “Minimum” is that amount typically needed to meet expectations (to earn a “B”).  To exceed expectations (to earn an “A”), a deeper discussion is needed. Each reference should be listed at the end of the paper following APA guidelines.  Online blogs are not acceptable references.  See Purdue OWL website for guidance on in-text citations.

Your Instructor will use Turn-it-in to ensure your paper is authentic work. To avoid plagiarism, see the course home page for more information and use the Purdue Online Writing Lab to learn how to paraphrase, summarize and cite the references you use in all academic writing assignments.

Contemporary
Project Management
Timothy J. Kloppenborg

Vittal Anantatmula

Kathryn N. Wells
F O U R T H E D I T I O N
Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203

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.
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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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
Cengage Learning Customer & Sales Support, 1-800-354-9706
www.cengage.com/permissions
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2017947974
978 1 337 40645 1
Cengage Learning
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02210
40
125
www.cengage.com.
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www.cengagebrain.com
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.
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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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
v
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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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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
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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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
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

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
viii
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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

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
xii Contents
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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
Contents xiii
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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
Contents xv
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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
Contents xvii
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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
xviii Contents
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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
Contents xix
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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
xx
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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
Preface xxi
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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
xxii Preface
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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
Preface xxiii
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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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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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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
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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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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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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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
xxix
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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.
1
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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.
fra
nt
ic
00
/S
hu
tte
rs
to
ck
.c
om
2
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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
3
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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
Benefits
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
Benefits
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 of
three 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 Define
Scope
PLANNING
4.2 Develop Project Management Plan
6.2 Define
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 Influence
3.4 Project Manager Competencies
Selecting Projects
12
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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
Benefits
Analysis
Realizing
Benefits
13
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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.
EXHIBIT 1.6
PROJECT SUCCESS
Meeting Agreements
Cost, schedule, and specifications met
Customer s Success
Needs met, deliverables used, customer satisfied
Performing Organization s Success
Market share, new products, new technology
Project Team s Success
Loyalty, development, satisfaction
Source: Adapted from Timothy J. Kloppenborg, Debbie Tesch, and Ravi Chinta, 21st Century Project Success Mea-
sures: Evolution, Interpretation, and Direction, Proceedings, PMI Research and Education Conference 2012 (Limer-
ick, Ireland, July 2012).
16 Part 1 Organizing Projects
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AGILE
CLASSIFYING BY SIZE Another method of classifying projects is by size. Large pro-
jects often require more detailed planning and control. Typically, most of the processes
outlined in PMBOK are relevant and applicable for large projects that require a few years
and hundreds of project team members for execution. However, even the smallest pro-
jects still need to use planning and control just in a more simplified manner. For exam-
ple, construction of a multistory building in China would require a highly detailed
construction schedule, but even a much simpler construction project of building a one-
car garage also needs to follow a schedule.
CLASSIFYING BY TIMING OF PROJECT SCOPE CLARITY A third method of classi-
fying projects deals with how early in the project the project manager and team are likely
to be able to determine with a high degree of certainty what the project scope will be. For
example, it may be rather simple to calculate the cubic feet of concrete that are required to
pour a parking lot and, therefore, how much work is involved. At the opposite end of the
spectrum, when developing a new pharmaceutical or developing a new technology, very
little may be determined in the project until the results of some early experiments are
reported. Only after analyzing these early experiment results is it possible to begin estimat-
ing cost and determining the schedule with confidence. For such projects, change is con-
stant and is caused by uncertainty and unknowns associated with these projects.
Consequently, it is important to manage project risks. The planning becomes iterative,
with more detail as it becomes available. In the first case, predictive or plan-driven project
techniques may work well. In the second case, adaptive or change-driven methods to iter-
atively determine the scope and plan for risks may be more important.
Agile methods are increasingly being used when scope clarity emerges slowly.
CLASSIFYING BY APPLICATION For the purpose of this book, we will discuss many
types of projects, such as those dealing with organizational change, quality and produc-
tivity improvement, research and development, information systems, and construction.
Many of these projects include extensive cross-functional work, which contributes to
the challenges associated with managing project teams and the triple constraints of
scope, duration, and cost. Remember, all projects require planning and control. Part of
the art of project management is determining when to use certain techniques, how much
detail to use, and how to tailor the techniques to the needs of a specific project.
1-4i Scalability of Project Tools
Projects range tremendously in size and complexity. In considering construction projects,
think of the range from building a simple carport to building an office tower. In both cases,
one would need to determine the wants and needs of the customer(s), understand the amount
of work involved, determine a budget and schedule, decide what workers are available and
who will do which tasks, and then manage the construction until the owner accepts the project
results. It should be easy to see that while both projects require planning and control, the level
of detail for the carport is a tiny fraction of that for the office tower. In this book, we first
demonstrate concepts and techniques at a middle level and then use a variety of project exam-
ples to demonstrate how to scale the complexity of the techniques up or down.
1-5 Project Roles
To successfully initiate, plan, and execute projects, a variety of executive, management, and
associate roles must be accomplished. Traditional project roles are shown in Exhibit 1.7.
Chapter 1 Introduction to Project Management 17
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In a large organization, a person often fills only one of these roles; sometimes, more than
one person fills a particular role. In small organizations, the same person may fill more
than one role. The names of the roles also vary by organization. The work of each role
must be accomplished by someone. Project managers are successful when they build strong
working relationships with the individuals who execute each of these roles.
1-5a Project Executive-Level Roles
The four traditional project executive-level roles are the sponsor, customer, steering
team, and the project management office. The first executive-level project role is that
of sponsor. A modern definition of executive sponsor is a senior manager serving in a
formal role given authority and responsibility for successful completion of a project
deemed strategic to an organization s success. 11 This textbook expands the sponsor s
role to include taking an active role in chartering the project, reviewing progress
reports, playing a behind-the-scenes role in mentoring, and assisting the project man-
ager throughout the project life, specifically in making critical decisions and supporting
the project team.
The second executive-level project role is that of the customer. The customer needs to
ensure that a good contractor for external projects or project manager for internal pro-
jects is selected, make sure requirements are clear, and maintain communications
throughout the project. In many traditional projects, the sponsor carries out the role of
customer. On many Agile projects, the customer role is quite significant.
The third executive role is the steering or leadership team for an organization. This
is often the top leader (CEO or other officer) and his or her direct reports. From a proj-
ect standpoint, the important role for this team is to select, prioritize, and resource pro-
jects in accordance with the organization s strategic planning and to ensure that accurate
progress is reported and necessary adjustments are made. Another important function of
this executive role is midstream evaluation of projects and portfolios to ensure that they
stay on track and produce expected results.
The fourth executive-level project role is that of project management office (PMO),
which is defined as a management structure that standardizes the project-related gov-
ernance processes and facilitates the sharing of resources, methodologies, tools and
techniques. 12 The PMO work can range from supporting project managers to control-
ling them by requiring compliance to directives in actually managing projects. The
PMO supports projects by mentoring, training, and assisting project teams and pro-
motes enterprise functions such as developing and augmenting processes, creating
and maintaining historical information, and advocating for project management
discipline.
EXHIBIT 1.7
TRADITIONAL PROJECT ROLES
EXECUTIVE ROLES MANAGERIAL ROLES ASSOCIATE ROLES
Sponsor Project Manager Core Team Member
Customer Functional Manager Subject Matter Expert (SME)
Steering Team Facilitator
Project Management Office
18 Part 1 Organizing Projects
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AGILE Agile project management roles are shown in Exhibit 1.8. Most of the same work stillneeds to be accomplished in organizations using Agile methods. Some of the work is
performed by different people because of the emphasis on empowering teams, and
some is performed at different times as requirements and scope emerge gradually instead
of just at the project start. Collaborative effort and communication, specifically with the
client, are common features of Agile project teams.
On Agile projects, arguably the most essential role is the customer representative
sometimes called the product owner. This person ensures that the needs and wants of
the various constituents in the customer s organization are identified and prioritized
and that project progress and decisions continually support the customer s desires.
In Agile projects, the customer representative role is so continuous and active that we
show it as both an executive- and managerial-level role. The customer representative
does much of what a sponsor might in traditional projects, but there also may be a des-
ignated sponsor (sometimes known as a product manager) who controls the budget.
A portfolio team often performs much of the work of a traditional steering team, and
a similar office that may be titled differently such as Scrum office performs much of
the work of a project office.
1-5b Project Management-Level Roles
The most obvious management-level role is the project manager. The project manager is
the person assigned by the performing organization to lead the team that is responsible
for achieving the project objectives. 13 The project manager is normally directly account-
able for the project results, schedule, and budget. This person is the main communicator,
is responsible for the planning and execution of the project, and works on the project from
start to finish. The project manager often must get things done through the power of influ-
ence since his or her formal power may be limited. The contemporary approach to project
management is to lead in a facilitating manner to the extent possible.
Another key management role is the functional manager (sometimes called a resource
manager). Functional managers are the department or division heads the ongoing man-
agers of the organization. They normally determine how the work of the project is to be
accomplished, often supervise that work, and often negotiate with the project manager
regarding which workers are assigned to the project.
The third managerial role is that of facilitator. If the project is complex and/or con-
troversial, it sometimes makes sense to have another person help the project manager
with the process of running meetings and making decisions.
EXHIBIT 1.8
AGILE PROJECT ROLES
EXECUTIVE ROLES MANAGERIAL ROLES ASSOCIATE ROLES
Customer (product owner) Customer (product owner) Team Member
Sponsor (product manager) Scrum Master
Portfolio Team Functional Manager
Project Management/Scrum Office Coach
Chapter 1 Introduction to Project Management 19
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AGILE
AGILE
On Agile projects, the customer representative or product owner works with the team on
a continuous basis, often performing some of the work a project manager might on a
traditional project. The Scrum Master serves and leads in a facilitating and collaborative
manner. This is a more limited, yet more empowering role than the traditional project
manager. The functional manager has a similar, but sometimes more limited, role than
the traditional department head. Many organizations using Agile also have a coach who
acts as a facilitator and trainer.
1-5c Project Associate-Level Roles
The project team is composed of a selected group of individuals with complimentary
skills and disciplines who are required to work together on interdependent and interrelated
tasks for a predetermined period to meet a specific purpose or goal. 14 In this book, these
individuals are called core team members. The core team, with the project manager, does
most of the planning and makes most of the project-level decisions.
The temporary members who are brought on board as needed are called subject mat-
ter experts.
The team members in Agile projects are assigned fulltime as much as possible, so there are
few subject matter experts. The teams are self-governing, so they perform many of the plan-
ning and coordinating activities that a project manager would typically perform. Small and
co-located teams often characterize Agile projects, and they work closely together.
1-6 Overview of the Book
Contemporary project management blends traditional, plan-driven, and contemporary
Agile approaches. It is integrative, iterative, and collaborative. Project management is
integrative since it consists of the 10 knowledge areas and the 5 process groups
described in the PMBOK® Guide, and one must integrate all of them into one coherent
and ethical whole. Project management is iterative in that one starts by planning at a
high level and then repeats the planning in greater detail as more information becomes
available and the date for the work performance approaches. Project managers need to
balance planning, control, and agility. Project management is collaborative since there
are many stakeholders to be satisfied and a team of workers with various skills and
ideas who need to work together to plan and complete the project. With these thoughts
of integration, iteration, and collaboration in mind, this book has four major parts:
Organizing and Initiating Projects, Leading Projects, Planning Projects, and Perform-
ing Projects.
1-6a Part 1: Organizing and Initiating Projects
Part 1 consists of three chapters that deal with organizing for and initiating projects.
CHAPTER 2 Chapter 2 covers project selection and prioritization. This includes both
internal projects, which should be selected in a manner consistent with the strategic
planning of the organization, and external projects. It also explains how to respond to
requests for proposals.
CHAPTER 3 Chapter 3 discusses chartering projects. The project charter is a docu-
ment issued by the project initiator or sponsor that formally authorizes the existence of
a project and provides the project manager with the authority to apply organizational
20 Part 1 Organizing Projects
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resources to project activities. 15 The charter can further be considered an agreement by
which the project sponsor and project manager (and often the project core team) agree
at a high level what the project is, why it is important, key milestone points in the sched-
ule, major risks, and possibly a few other items. It allows the project manager and core
team to understand and agree to what is expected of them.
Finally, Microsoft Project, a tool that facilitates effective project planning, controlling,
and communicating, is introduced. Microsoft Project is utilized in eight chapters to dem-
onstrate how to automate various project planning and control techniques. The examples
and illustrations in this book use Microsoft Project 2016. If a person is using an earlier
version of Microsoft Project, there are slight differences. If a person is using a competing
project scheduling package, the intent remains the same, but the mechanics of how to
create certain documents may differ.
1-6b Part 2: Leading Projects
Part 2 consists of three chapters on leadership aspects of projects.
CHAPTER 4 Chapter 4 focuses on organizational structure, organizational culture,
project life cycle, and project management roles of the parent organization. The orga-
nizational structure section describes ways an organization can be configured and the
advantages and disadvantages of each in regard to managing projects. Next covered is
the culture of the parent organization and the impact it has on the ability to effectively
plan and manage projects. The industry and type of project often encourage managers
to select or customize a project life cycle model. The roles covered include executive-,
managerial-, and associate-level responsibilities that must be performed. The demands
of each role are explained, along with suggestions for how to select and develop people
to effectively fill each role, considering both the role and the unique abilities and inter-
ests of each person.
CHAPTER 5 Chapter 5 describes how to carry out the project work with a project team
in order to accomplish the project objectives. The project manager needs to simultaneously
champion the needs of the project, the team, and the parent organization. The project
manager manages the people side of the project by effectively using the stages of project
team development, assessing and building the team members capability, supervising their
work, managing and improving their decision making, and helping them maintain enthu-
siasm and effective time management. Project managers guide their team in managing and
controlling stakeholder engagement.
CHAPTER 6 Chapter 6 begins by identifying the various project stakeholders, their
wants and needs, and how to prioritize decisions among them. Chapter 5 also includes
communications planning for the project because poor communication can doom an
otherwise well-planned and well-managed project. The information needs of each stake-
holder group should be included in the communications plan.
1-6c Part 3: Planning Projects
Part 3 includes six chapters dealing with various aspects of project planning.
CHAPTER 7 Chapter 7 shows how to determine the project scope and outline it in the
work breakdown structure (WBS). The WBS is deliverable-oriented hierarchical
decomposition of the work to be executed by the project team to accomplish the project
objectives and create the required deliverables. 16
Chapter 1 Introduction to Project Management 21
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The WBS is a document that progressively breaks the project down into its compo-
nents so that each piece can be described as a deliverable for which one person can plan,
estimate the costs, estimate the time, assign resources, manage, and be held accountable
for the results. This is a critical document since it is the foundation for most of the other
planning and control activities. The chapter ends with instructions on putting a WBS
into Microsoft Project.
CHAPTER 8 Chapter 8 deals with scheduling projects. The project schedule is an
output of a schedule model instance that presents the time-based information required
by the communication plan, including activities with planned dates, durations, mile-
stone dates, and resource allocation.17 This chapter starts with background information
on project scheduling and then covers construction of schedules by defining activities,
determining the order in which they need to be accomplished, estimating the duration
for each, and then calculating the schedule. Chapter 8 also includes instructions on
how to interpret a project schedule; clearly communicate it using a bar chart called a
Gantt chart; and use Microsoft Project to construct, interpret, and communicate proj-
ect schedules.
CHAPTER 9 Chapter 9 demonstrates how to schedule resources on projects: determin-
ing the need for workers, understanding who is available, and assigning people. All of the
techniques of resourcing projects are integrated with the behavioral aspects of how to
deal effectively and ethically with the people involved. Resource needs are shown on a
Gantt chart developed in Chapter 8, the responsibilities are shown as they change over
time, conflicts and overloads are identified, and methods for resolving conflicts are intro-
duced. Alternative approaches for creating and compressing schedules are shown. Many
of the techniques in this chapter are also shown with MS Project.
CHAPTER 10 Chapter 10 discusses the project budget, which is dependent on both the
schedule and the resource needs developed in the previous two chapters. The project
budget is The sum of work package cost estimates, contingency reserve, and manage-
ment reserve.18 Cost planning, estimating, budgeting, establishing cost control, and
using MS Project for project budgets are all included.
CHAPTER 11 Chapter 11 starts with establishing a risk management plan. It covers
methods for identifying potential risks and for determining which risks are big enough
to justify specific plans for either preventing the risk event from happening or dealing
effectively with risk events that do happen. Finally, in risk response planning, strategies
for dealing with both positive risks (opportunities) and negative risks (threats) are
discussed.
CHAPTER 12 Chapter 12 begins with a discussion of how modern project quality con-
cepts have evolved. Then it deals with core project quality demands of stakeholder satis-
faction, empowered performance, fact-based management, and process management.
The third topic of this chapter is developing the project quality plan. Next, the chapter
describes various quality improvement tools for projects.
Since Chapter 12 is the last planning chapter, it concludes with a method of integrating
the various sections developed in the previous chapters into a single, coherent project plan.
Conflicts that are discovered should be resolved, judgment needs to be applied to ensure
that the overall plan really makes sense, and one or more kickoff meetings are normally
held to inform all of the project stakeholders and to solicit their enthusiastic acceptance
of the plan. At this point, the project schedule and budget can be baselined in MS Project.
22 Part 1 Organizing Projects
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While bits of the project that might have caused delays if they were not started early may
already be in progress, the formal kickoff is the signal that the project is under way!
1-6d Part 4: Performing Projects
Part 3 includes three chapters that deal with performing the project.
CHAPTER 13 Chapter 13 begins by introducing relevant supply chain concepts such as
a supply chain view of projects, the components that form a supply chain, factors to con-
sider when dealing with a supply chain, and methods of improving the performance of a
supply chain. Make-or-buy analysis and contract types lead the reader through procure-
ment planning. Identifying and selecting sellers lead into managing contracts to assure
receipt of promised supplies and services according to contractual terms. The chapter
ends with advantages and requirements of effective project partnering.
CHAPTER 14 While the project work is being performed, the project manager needs
to determine that the desired results are achieved the subject of Chapter 14. Monitor
and control project work is defined as the process of tracking, reviewing, and report-
ing the progress to meet the performance objectives defined in the project management
plan. 19 This starts with gathering performance data already identified during project
initiating and planning. The actual performance data are then compared to the desired
performance data so that both corrective and preventive actions can be used to ensure
that the amount and quality of the project work meet expectations. MS Project can be
used for this progress reporting and for making adjustments. Earned value analysis is
used to determine exactly how actual cost and schedule progress are compared with
planned progress. Overcoming obstacles, managing changes, resolving conflicts, repri-
oritizing work, and creating a transition plan all lead up to customer acceptance of the
project deliverables.
CHAPTER 15 Chapter 15 deals with finishing projects and realizing benefits. Close
project or phase is defined as all the work needed to formally close a project or phase.
This chapter includes a section on terminating projects early, in case either the project is
not doing well or conditions have changed and the project results are no longer needed,
and a section on timely termination of successful projects. Topics include how to secure
customer feedback and use it along with the team s experiences to create lessons learned
for the organization; reassign workers and reward those participants who deserve recog-
nition; celebrate success; perform a variety of closure activities; and provide ongoing sup-
port for the organization that is using the results of the project. Finally, after the project
deliverables have been used for some time, an assessment should determine if the prom-
ised benefits are being realized.
PMP/CAPM Study Ideas
Everything in this book is designed to mirror and explain the content in the latest
edition the sixth of the Guide to the Project Management Body of Knowledge
(PMBOK), the international standard produced by the Project Management Institute
(PMI). Not only will the content and questions in this book help you learn the best prac-
tices for managing and executing projects, but they will also help you prepare for one of
the licensing exams if you choose to pursue a project management credential such as the
CAPM or PMP. More information on these and other PMI certifications can be found at
www.pmi.org/certifications/types.
Chapter 1 Introduction to Project Management 23
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While either of these credentials can open doors for you professionally, the effort
needed to acquire them should not be underestimated. In addition to work and educa-
tion requirements (specified at the website noted above), you will need to pass an online
test consisting of 150 (CAPM) or 200 (PMP) questions, respectively. PMI does not pub-
lish the exact pass rates of either of these tests, but they are designed to be difficult. It
will not be enough for you to just memorize knowledge areas, process groups, and inputs
and outputs; rather, you will need a solid understanding of each of these in order to
answer higher-level thinking questions of a wide variety. In this book, we will provide
dozens of questions in each chapter for you to use as a guide.
Summary
A project is an organized set of work efforts undertaken
to produce a unique output subject to limitations of
time and resources such as materials, equipment,
tools, and people. Since the world is changing more
rapidly than in the past, many people spend an increas-
ing amount of their working time on projects. Project
management includes work processes that initiate,
plan, execute, monitor, control, and close project
work. During these processes, trade-offs must be
made among the scope, quality, cost, and schedule, so
that the project results meet the agreed-upon require-
ments, are useful to the customers, and promote the
organization.
All projects, regardless of size, complexity, or appli-
cation, need to be planned and managed. While the
level of detail and specific methods vary widely, all pro-
jects need to follow generally accepted methods. PMI is
a large professional organization devoted to promoting
and standardizing project management understanding
and methods. One of PMI s standards, A Guide to the
Project Management Body of Knowledge (PMBOK®
Guide), is composed of five process groups: initiating,
planning, executing, monitoring and controlling, and
closing; along with ten knowledge areas: integration,
scope, schedule, cost, quality, resources, communica-
tions, risk, procurement, and stakeholders.
To successfully initiate, plan, and execute projects,
two more things are needed. One is to understand what
project success is and what drives it, along with what
project failure is and its major causes. The other is an
understanding of the various executive-, managerial-,
and associate-level roles in project management. This
book is organized to be useful to students who will
enter a variety of industries and be assigned to projects
of all sizes and levels of complexity. Students will learn
how to understand and effectively manage each of
these process groups and knowledge areas. Microsoft
Project 2016 is used in eight chapters to illustrate
how to automate various planning, scheduling, resour-
cing, budgeting, and controlling activities. All defini-
tions used are from the PMBOK Guide, sixth edition.
This book follows a chronological approach through-
out a project s life cycle, emphasizing knowledge and
skills that lead to project success.
Key Terms Consistent with PMI Standards and Guides
The glossary in this book uses terms as defined in various Project Management Institute guides and standards
where they are distinct. The glossary also uses commonly understood definitions where terms are standard.
project, 4
stakeholders, 4
project management, 4
soft skills, 7
hard skills, 7
functional manager, 7
project life cycle, 7
project management process group, 10
initiating processes, 10
planning processes, 10
executing processes, 10
monitoring and controlling processes, 10
closing processes, 10
integration management, 11
scope management, 11
schedule management, 11
cost management, 11
quality management, 11
resources management, 11
communications management, 11
24 Part 1 Organizing Projects
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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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risk management, 11
procurement management, 11
stakeholder management, 11
deliverable, 12
scope, 13
product scope, 13
project scope, 13
quality, 13
sponsor, 16
project management office (PMO), 17
customer, 17
steering or leadership team, 17
project manager, 18
project team, 18
project charter, 19
work breakdown structure (WBS), 20
project schedule, 20
project budget, 20
monitor and control project work, 21
close project or phase, 21
Chapter Review Questions
1. What is a project?
2. What is project management?
3. How are projects different from ongoing
operations?
4. What types of constraints are common to most
projects?
5. What are the three components of the Talent
Triangle?
6. At what stage of a project life cycle are the major-
ity of the hands-on tasks completed?
7. During which stage of the project life cycle are
loose ends tied up?
8. What are the five process groups of project
management?
9. Which process group defines a new project or
phase by obtaining authorization?
10. What are the 10 project management knowledge
areas?
11. What two project dimensions are components of
project performance?
12. How do you define project success?
13. How do you define project failure?
14. List four common causes of project failure.
15. What are three common ways of classifying
projects?
16. What is predictive or plan-driven planning, and
when should it be used?
17. What is adaptive or change-driven planning, and
when should it be used?
18. What makes someone a project stakeholder?
19. What are the three project executive-level roles?
20. List and describe each of the managerial and
associate project roles.
Discussion Questions
1. Using an example of your own, describe a project
in terms that are common to most projects.
2. Why are more organizations using project man-
agement? If you were an executive, how would
you justify your decision to use project manage-
ment to the board of trustees?
3. Explain how to scale up or down the complexity
of project planning and management tools and
what effect, if any, this might have on the project
life cycle.
4. List and describe several issues that pertain to
each stage of the project life cycle.
5. Put the five project management process groups
in order from the one that generally requires the
least work to the one that requires the most.
6. Name the 10 project management knowledge
areas, and briefly summarize each.
7. Discuss how a project could be successful in
terms of some measures yet unsuccessful by
others.
8. What does project failure mean? What are some
examples?
9. Compare and contrast advantages and disadvan-
tages of predictive/plan-driven and adaptive/
change-driven project life cycle approaches.
10. You are given a project to manage. How do you
decide whether to use a predictive or adaptive
approach?
11. Contrast project managers and functional managers.
12. List as many project roles as you can, and iden-
tify what each one is responsible for in terms of
the project.
Chapter 1 Introduction to Project Management 25
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PMBOK® Guide Questions
The purpose of these questions is to help visualize the type of questions on PMP and CAPM exams.
1. Which project role provides resources or support
for the project, promotes and protects the project
at higher levels of management, and takes an
active role in the project from the chartering
stage through project closure?
a. functional manager
b. project manager
c. project team member
d. project sponsor
2. Which PMBOK® Guide Knowledge Area
includes those processes required to ensure that
the project includes all the work required, and
only the work required, to complete the project
successfully?
a. cost management
b. scope management
c. risk management
d. quality management
3. In order to be successful, the project team must
be able to assess the needs of stakeholders and
manage their expectations through effective
communications. At the same time, they must
balance competing demands among project
scope, schedule, budget, risk, quality, and
resources, which are also known as project
.
a. plan elements
b. deliverables
c. constraints
d. targets
4. Projects pass through a series of phases as they
move from initiation to project closure. The
names and number of these phases can vary sig-
nificantly depending on the organization, the
type of application, industry, or technology
employed. These phases create the framework
for the project, and are referred to collectively
as the .
a. project life cycle
b. project management information system
(PMIS)
c. product life cycle
d. Talent Triangle
5. Based on PMI s definition, which of these is a
good example of a project?
a. manufacturing a standard commodity
b. following policies and procedures for procur-
ing an item
c. designing and launching a new website
d. using a checklist to perform quality control
6. When would a predictive project life cycle be the
preferred approach?
a. when the high-level vision has been devel-
oped, but the product scope is not well
defined
b. when the environment is changing rapidly
c. when the product to be delivered is well
understood
d. when the product will be created through a
series of repeated cycles
7. To be effective, a project manager needs to pos-
sess all of the following competencies except
.
a. personal effectiveness attitudes, core per-
sonality traits, leadership
b. authority power or right granted by the
organization
c. performance what project managers can
accomplish while applying their project man-
agement knowledge
d. knowledge of project management
understanding of project management
tools and techniques
8. In Adaptive Life Cycles (change-driven or Agile
methods), .
a. the overall scope of the project is fixed, and
the time and cost are developed
incrementally
b. the overall cost is fixed, and the project scope
and schedule are developed iteratively
c. the time and cost are fixed, but the scope is
developed iteratively
d. change control is very important
9. The two traditional project management
associate-level roles are different in each of the
following ways except .
a. duration of time spent on project
b. ability to work within project constraints
c. degree of input contributed to project planning
d. skill set
26 Part 1 Organizing Projects
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10. A freelance project manager is brought in by
Company X to lead a large, expensive project.
This project manager has excellent leadership
skills and a strong technical understanding of
the project. In order for her to optimize every
component of the Talent Triangle, what might
be a good activity for the project manager at
the start of her time with Company X?
a. familiarize herself with the long-term objec-
tives of Company X
b. host an icebreaker for all team members
c. attend a seminar on advanced leadership
techniques
d. send an email including her résumé to all
SMEs to ensure they are aware of her techni-
cal background
I N T E G R A T E D E X A M P L E P R O J E C T S
We will use two example projects throughout all 15 chapters
of this book. One will be a construction project suited to
mostly traditional project planning and management. The
other will be a development project suited more toward
Agile project planning and management. In this chapter, we
will introduce both of them. In subsequent chapters, we will
choose one to demonstrate techniques and concepts from
the chapter and ask leading questions of the other one. We
will alternate chapters so professors can choose to use the
questions as assignments if they wish.
SUBURBAN HOMES CONSTRUCTION PROJECT
Purchasing a new home is the single largest investment most
of us will make in our lifetime. You can either purchase the
home from a reputed real estate building company or manage
the construction of your home using project management
principles that you have mastered. The latter approach can
save significant amounts of money over the life of a typical
30-year mortgage. Additionally, it is likely to provide you with
one of the most satisfying experiences in your life because
you will get an opportunity to see the results of choices you
made in building your home.1 However, on the downside, if
you manage the project poorly, it also has the potential on
many levels to be a disaster.
The experience of managing the construction of a
single-family home provides a coherent account of costs,
benefits, other considerations related to construction,
risks, hazards, and critical decisions. The experience also
has the potential for joy if the project is a successful
endeavor.
Suburban Homes is a medium-sized, fast-growing con-
struction company in the Midwest region of the United
States. Due to its significant growth and good reputation for
building quality single-family homes and townhomes, the
company decided to expand its business to several Southern
states in the United States. However, Suburban Homes rec-
ognized the scope for managing resources effectively and
efficiently to increase profits. It has decided to formalize proj-
ect management practices by developing and implementing
standard and promising processes, tools, and techniques.
For this purpose, the company was looking for a competent
project manager to manage its projects. They hired Adam
Smith as their new project manager.
Adam Smith had worked for several years in the construc-
tion industry and supplemented his experience with project
management education. Consequently, he gained considerable
experience and developed expertise in managing construction
projects. Adam believes in managing projects by adhering to
various project management processes, tools, and techniques.
In his new position as the project manager, Adam s primary
task is to improve the performance of project management
and increase the project success rate.
What advice would you offer to Adam Smith?
1Suprick J. and Anantatmula V. (2010).
Chapter 1 Introduction to Project Management 27
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Semester Project Instructions
This book is designed to give your professors the option
to have you practice the concepts and techniques from
each chapter on a real project. Often, the project chosen
will be for a nonprofit group of some kind such as a
United Way agency, a church, or a school. The project
could, however, be for a company or a part of the uni-
versity. The semester project can often be one that sev-
eral students will be assigned to work on as a team.
Each chapter provides suggested assignments to
practice project management skills on the real or
potential project you are using. Depending on the
emphasis your professor chooses, you may need to per-
form some, most, or all of these assignments. At a min-
imum, your professor will probably assign the charter,
work breakdown structure, and schedule.
In any case, each of the following chapters prompts
you to perform various activities to plan and execute
the project. At some point in the first couple of weeks,
your professor will probably invite at least one repre-
sentative from each organization to your class to intro-
duce their project and to meet you. We will call these
persons sponsors and define their role more fully in
Chapter 3. Since this first chapter is a broad introduc-
tion to project management, your task for the
Chapter 1 sample project may be just to familiarize
yourself with your new student team, your sponsor,
your sponsor s organization, and the overall direction
of your project. If you have enough input from your
sponsor, your professor may also ask you to create a
customer trade-off matrix, as shown in Exhibit 1.6
and/or a definition of success for your project, as in
Exhibit 1.7. Your professor also may ask you to answer
certain specific and/or open-ended questions concern-
ing your newly assigned project.
Subsequent chapters give you more in-depth tools to
acclimate you to your project, the organization you will
be working for, and the various stakeholders who have
an interest in the project. For example, in the next chap-
ter, you learn how project selection flows from an orga-
nization s strategic planning, and you should seek to
learn why this project was chosen and how it supports
the strategic goals of the organization.
CASA DE PAZ DEVELOPMENT PROJECT
Casa de Paz is an intentional community supporting the trans-
formative journey of recovery for Latina women and their chil-
dren. It is a 501(c)(3) nonprofit organization that is just starting.
The vision is to create a communal living space for multiple
Latina women and their children. The women and their chil-
dren also would have access to a variety of service providers
in the form of graduate students living in the same building.
Two possible buildings have been identified. Some of the
many things that need to take place for this vision to become
a reality are board and working group structuring, fundraising,
accountancy, promotion, website development, community
relations development, building purchase and renovation, pro-
gram development, legal services, educational advocacy, and
English as a Second Language (ESL) tutoring, among others.
While every project has trade-offs, success on this project will
be measured more on the creation of a safe environment with
needed services than on cost and schedule.
Casadepazcinci.org
Why Is This Project So Important?
Hundreds of thousands of people are fleeing violence in
their home countries. In the United States, many of them
come from Latin America. Often, they lack communities
for support and integration as they transition from their
countries of origin. In addition, many face many obsta-
cles to stability and flourishing. How would you put
your life back together if you were a mother fleeing vio-
lence in your country of origin, and once in a new coun-
try, that same violence continues in your new home?
Few spaces offer stability and encouragement in such
circumstances, much less cultural sensitivities and pro-
fessional services to facilitate the transformation to self-
sufficiency and success. Casa de Paz/House of Peace is
an intentional community that encourages and draws out
women s resilience both by meeting them where they
are and providing time and space to heal, recover, and
grow. Most shelters for women and children are tempo-
rary; the average stay is seven to twelve days. Casa de
Paz provides up to six months of stability, community,
and professional services to support women s growth
along a continuum of self-sufficiency matrixes. It is a
community that recognizes women s dignity and cele-
brates each step toward the realization of their gifts as
human beings.
28 Part 1 Organizing Projects
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PROJECT MANAGEMENT IN ACTION
Using Appreciative Inquiry to Understand Project Management
Each project creates a unique product, service,
or result that certain stakeholders desire. Project
success requires understanding stakeholder require-
ments, clarifying project expectations, and agreeing
upon project scope. As such, it is imperative to iden-
tify relevant stakeholders and to have a constructive
engagement with them. One tool that is helpful for
allowing such engagement and for navigating through
complexities is appreciative inquiry (Al).
What Is Appreciative Inquiry?
The principles: Appreciative inquiry (AI) is a positive
philosophy for change, wherein whole systems
convene to inquire for change (Cooperrider, 2003).
AI recognizes the power of the whole and builds on
conversational learning that emerges out of the whole.
It operates on the belief that human systems move in
the direction of their shared image and idea of the
future, and that change is based on intentional and
positive inquiry into what has worked best in the past.
In this sense, AI suggests that human organizing and
change are a relational process of inquiry that is
grounded in affirmation and appreciation. Typically, the
process works its way through the four phases of Dis-
covery, Dream, Design, and Delivery (Conklin, 2009).
Implications of AI on Defining
Project Scope
Project success partially depends upon identifying key
stakeholders: eliciting their true wants and needs to
determine project scope; and keeping them appropri-
ately engaged throughout the entire project. The early
involvement is critical because it lays out clear goals
and boundaries of project scope. However, eliciting
accurate responses may be difficult, especially since
many projects may be planned and conducted in an
atmosphere of uncertainty. The ongoing involvement
helps to ensure stakeholders know what they will get
from the project and will be pleased.
Appreciative inquiry is a tool that may assist proj-
ect stakeholders to navigate through their inquiries via
positive conversations. For example, a typical process
may look like this:
Discovery (What has been?): This phase inquires
into and discovers the positive capacity of a group,
organization, or community. People are encouraged to
use stories to describe their strengths, assets, peak
experiences, and successes to understand the unique
conditions that made their moments of excellence
possible. In this step, stakeholders reflect on the past
to recollect instances when they believed they could
clearly articulate their true needs and wants; and
when their needs and wants were folded into the
project scope. Through storytelling, they collectively
discover the process of project selection and prioriti-
zation and articulate a gauge of project success. As
they discuss, they start generating a dense web of
understanding an understanding and an apprecia-
tion of all their capacities that make moments of
excellence possible. Agile projects use a similar
method of storytelling to understand user require-
ments and ultimately define project scope.
Dreaming (What could be?): Building on the
moments of excellence of the participants, this phase
encourages the participants to imagine what would
happen if their moments of excellence were to
become a norm. Participants dream for the ideal con-
ditions and build hope and possibility of an ideal
future. As people share their stories, the focus of the
process now shifts to dreaming of a perfect, desirable
state for the stakeholders. Through this journey, the
goal should be to enable the participants to build
positive energy around their strengths and also to
dream about the direction in which they feel comfort-
able moving.
Delivery:
What will
be?
Discovery:
What has
been?
Design:
What
should be?
Dream:
What
could be?
Chapter 1 Introduction to Project Management 29
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References
A Guide to the Project Management Body of Knowledge
(PMBOK® Guide), 6th ed. Exposure Draft (Newtown
Square, PA: Project Management Institute, 2017).
Anantatmula, Vittal S., Project Teams: A Structured
Developmental Approach, 2016, New York: Business
Expert Press.
Chandler, Dawne E., and Payson Hall, Improving
Executive Sponsorship of Projects: A Holistic
Approach, 2017, New York: Business Expert Press.
Cooper, Robert G., Winning at New Products: Path-
ways to Profitable Innovation, Proceedings, PMI
Research Conference 2006 (Montreal, July 2006).
Crowe, Andy, Alpha Project Managers: What the Top
2% Know That Everyone Else Does Not (Atlanta:
Velociteach, 2006).
Kloppenborg, Timothy J., and Warren A. Opfer, The
Current State of Project Management Research:
Trends, Interpretations, and Predictions, Project
Management Journal 33 (2) (June 2002): 5 18.
Kloppenborg, Timothy J., Debbie Tesch, and Broderick
King, 21st Century Project Success Measures: Evo-
lution, Interpretation, and Direction, Proceedings,
PMI Research and Education Conference 2012
(Dublin, Ireland, July 2012).
Muller, R., and R. Turner, The Influence of Project
Managers on Project Success Criteria by Type of
Project, European Management Journal 25 (4)
(2007): 298 309.
PMI Lexicon of Project Management Terms Version
3.0, 2015 (Newtown Square, PA).
Project Management Institute, Business Analysis for
Practitioners: A Practice Guide, 2015 (Newtown
Square, PA).
Project Management Institute, Practice Standard
for Scheduling 2nd ed., 2011 Newtown Square,
PA).
Project Management Institute, Practice Standard for
Work Breakdown Structures 2nd ed., 2006 (New-
town Square, PA).
Shenhar, A. J., and D. Dvir, Reinventing Project
Management (Boston: Harvard Business School
Press, 2007).
https://asq.org/quality-resources/quality-glossary/q,
accessed February 6, 2017.
Designing (What should be?): This phase creates
design principles that will help the participants real-
ize their dream. Participants are encouraged to
stretch their imagination to move the system from
where it currently is to where the participants want it
to be. At this stage, the participants should be
encouraged to imagine a perfect world without any
constraints. Therefore, if there were no resource
constraints, what would the scope of the project look
like?
Delivery (What will be?): In this phase, participants
are encouraged to think of the various subsystems
that should take the responsibility of the design phase
to sustain the design from the dream that it discov-
ered (Cooperrider et al., 2003, p. 182). In this phase,
various stakeholders are encouraged to decide what
they will be committing themselves to.
Key Outcome
Going through this entire process allows stakeholders
to elicit and articulate their expectations from the
project. Stakeholders also have a better understand-
ing of how their needs and wants link to and lead
them to a desirable future state. Finally, in order to
sustain their dream, their commitment is clearly artic-
ulated. As stakeholders commit themselves to specific
endeavors on the project, they will implicitly revisit the
opportunities and cost that lay ahead of them, which
allows stakeholders to draw a realistic boundary
around their commitment to the project.
Projects are temporary and unique and may have
shifting boundaries over time. The process of engag-
ing stakeholders via appreciative inquiry (AI) is an
effective way to address the ambiguity and uncer-
tainty in project management.
Source: Rashmi Assudani, Associate Professor and Chair, Department of Management and Entrepreneurship, Williams College of Business, Xavier Uni-
versity. Adapted from Conklin, T. A., Creating Classrooms of Preference: An Exercise in Appreciative Inquiry. Journal of Management Education 33 (6)
(2009): 772 792. Cooperrider, D. L., D. Whitney, and J. M. Stavros, Appreciative Inquiry Handbook (Bedford Heights, OH: Lakeshore, 2003).
30 Part 1 Organizing Projects
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Endnotes
1. https://www.smartsheet.com/comprehensive-guide
-values-principles-agile-manifesto, accessed Decem-
ber 1, 2016.
2. Wikipedia https://en.wikipedia.org/wiki/Functional_
manager, accessed February 6, 2017.
3. PMI Lexicon of Project Management Terms
Version 3.0, 2015 (Newtown Square, PA): 9.
4. Robert G. Cooper, Winning at New Products:
Pathways to Profitable Innovation, Proceedings
(2006).
5. http://www.pmi.org/pmbok-guide-standards/
foundational, accessed February 6, 2017.
6. Project Management Institute, A Guide to
the Project Management Body of Knowledge
(PMBOK® Guide), 6th ed. Exposure Draft.
(Newtown Square, PA: Project Management
Institute, 2017): 15.
7. Ibid.
8. PMI Lexicon of Project Management Terms
Version 3.0, 2015 (Newtown Square, PA): 7.
9. PMI Lexicon of Project Management Terms
Version 3.0, 2015 (Newtown Square, PA): 7.
10. https://asq.org/quality-resources/quality-glossary/q,
accessed February 6, 2017.
11. Dawne E. Chandler and Payson Hall, Improving
Executive Sponsorship of Projects: A Holistic
Approach, 2017 (New York: Business Expert
Press): 1.
12. PMI Lexicon of Project Management Terms
Version 3.0, 2015 (Newtown Square, PA): 13.
13. Ibid.
14. Vittal S. Anantatmula, Project Teams: A Structured
Developmental Approach, 2016, New York: Business
Expert Press, 9.
15. PMI Lexicon of Project Management Terms
Version 3.0, 2015 (Newtown Square, PA): 5.
16. Project Management Institute, Practice Standard
for Work Breakdown Structures 2nd ed., 2006
(Newtown Square, PA): 121.
17. Project Management Institute, Practice Standard
for Scheduling 2nd ed., 2011 (Newtown Square,
PA): 138.
18. PMI Lexicon of Project Management Terms
Version 3.0, 2015 (Newtown Square, PA): 8.
19. Project Management Institute, A Guide to the Proj-
ect Management Body of Knowledge (PMBOK®
Guide), 6th ed. Exposure Draft. (Newtown Square,
PA: Project Management Institute, 2017): 15.
Chapter 1 Introduction to Project Management 31
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C H A P T E R 2
Project Selection and Prioritization
With the development of a new five-year strategic plan, significant financial growth,
and a major reorganization, Living Arrangements for the Developmentally Disabled
(LADD) found itself overwhelmed with tasks and at a point that required the thought-
ful selection and prioritization of projects. Prior strategic plans were largely dictated
by the former executive director, created in a silo of sorts. It was through the intro-
duction of a new executive director to LADD and complete new leadership at the
management level that an opportunity presented itself for new, cross-department
collaboration, innovative methods to carry out established practices, and the ability
to identify and draw on the strengths of the individual members of the team.
LADD is a medium-sized nonprofit corporation that is mission focused and
considered a leader in the field of supporting individuals with developmental dis-
abilities. Its efforts reach beyond day-to-day functions and extend in large part to
awareness, advocacy, and action. With the sponsorship of a national film festival
focused on disabilities and its work in the civic and government sectors at local
and national levels, LADD has been able to influence positive change in legisla-
tion and the inclusion of people with disabilities at all levels of society.
CHAPTER OBJECTIVES
After completing this
chapter, you should
be able to:
CORE OBJECTIVES:
Explain in your own
words the strategic
planning and portfolio
management
processes.
Describe how to
select, prioritize, and
resource projects
as an outgrowth of
strategic planning.
From a contractor s
viewpoint, describe
how to secure
projects.
TECHNICAL OBJECTIVES:
Compare the
strengths and weak-
nesses of using
financial and scoring
models to select
projects.
Given organizational
priorities and several
projects, demonstrate
how to select and
prioritize projects
using a scoring
model.
BEHAVIORAL OBJECTIVES:
Explain the strengths
an organization might
possess that could
improve its ability to
perform projects.
M
on
ke
y
Bu
si
ne
ss
Im
ag
es
/S
hu
tte
rs
to
ck
.c
om
32
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Project selection and prioritization were exactly what LADD needed because
they were trying to maintain pace with a large program and revenue growth
curve, new leadership at the helm, and federal changes in the way services
were to be delivered to those with developmental disabilities. Projects from the
strategic plan were scored based on established value sets that included criteria
such as if the project met the mission, was financially feasible, or strengthened
personal or community relationships.
LADD s strategic plan contains 32 primary goals and many more objectives.
The project selection and prioritization process was a key tool to build a frame-
work that would inspire agency success over the next five years. It is also
anticipated to be a method to reduce program competition and increase under-
standing within the management team as occasions for team development
and departmental collaboration occur. In the end, each step of the process
will lead the agency to achieve its vision of propelling the inclusion and suc-
cess of people with disabilities forward with a positive impact throughout the
community.
Amy Harpenau, Vice President, Living Arrangements
for the Developmentally Disabled.
2-1 Strategic Planning Process
One of the tasks of a company s senior leadership is to set the firm s strategic direction.
Some of this direction setting occurs when an organization is young or is being
revamped, but some needs to occur repeatedly. Exhibit 2.1 depicts the steps in strategic
planning and how portfolio management should be an integral part.
2-1a Strategic Analysis
The first part of setting strategic direction is to analyze both the external and internal
environments and determine how they will enhance or limit the organization s ability
to perform. This strategic analysis is often called strengths, weaknesses, opportunities,
and threats (SWOT). The internal analysis (elements within the project team s control)
consists of asking what strengths and weaknesses the organization possesses. The exter-
nal analysis (elements over which the project team has little or no control) consists of
asking what opportunities and threats are posed by competitors, suppliers, customers,
regulatory agencies, technologies, and so on. The leaders of an organization often need
to be humble and open to ideas that are unpleasant and contradictory to their beliefs
when conducting this analysis. Performed correctly, a strategic analysis can be very illu-
minating and can suggest direction for an organization. An example of SWOT analysis
PMBOK ® 6E COVERAGE
PMBOK ® 6E OUTPUTS
1.2 Foundational Elements Elevator Pitch
Selecting Projects Project Selection and Prioritization Matrix
Project Resource Assignment Matrix
PMBOK® GUIDE
Topics:
1.2 Foundational
Elements
Selecting Projects
CHAPTER OUTPUTS
Elevator Pitch
Project Selection and
Prioritization Matrix
Project Resource
Assignment Matrix
33
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for the Built Green Home at Suncadia is shown in Exhibit 2.2. The Built Green Home at
Suncadia, Washington, was developed using advanced sustainability concepts and a large
degree of stakeholder involvement.
2-1b Guiding Principles
Once the SWOT analysis is complete, the organization s leadership should establish
guiding principles such as the vision and mission. Some organizations break this step
into more parts by adding separate statements concerning purpose and/or values.
Often, these sections are included in the mission. For simplicity s sake, they will be trea-
ted as part of the mission in this book. It is more important to understand the intent of
each portion and achieve it rather than worry about the exact format or names of indi-
vidual portions.
VISION The vision is a one-sentence statement describing the clear and inspirational
long-term, desired change resulting from an organization or program s work.1 A clear
and compelling vision will help all members and all stakeholders of an organization
understand and desire to achieve it. Visions often require extra effort to achieve but are
considered to be worth the effort. Visions are often multiyear goals that, once achieved,
suggest the need for a new vision.
One of the visions most often cited, because it was so clear and compelling, was Pres-
ident John F. Kennedy s goal of placing a man on the moon before the end of the 1960s.
Kennedy set this goal after Russia launched Sputnik and the United States found itself
behind in the space race. His vision was very effective in mobilizing people to achieve
it; further, it rapidly transformed a huge suburban area near Houston into a developed
and sustainable economic and technology zone.
EXHIBIT 2.1
STRATEGIC PLANNING AND PORTFOLIO ALIGNMENT
34 Part 1 Organizing Projects
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A more recent example was in 2009 when hundreds of community leaders in Cleve-
land, Ohio, decided to use a systems approach to guide many interrelated social and eco-
nomic efforts in their region. The vision they stated is, Cleveland and other cities
throughout Northeast Ohio should be green cities on a blue lake. 2 They continue to
use this vision to guide regional leaders as they choose where to invest their time and
resources in bettering the region and life for its residents. They also are currently plan-
ning their 2019 Sustainable Cleveland Summit.3
Increasingly, companies are incorporating the triple bottom line into their vision
statements. This approach emphasizes the social, environmental, and economic health
of the company s stakeholders rather than a narrow emphasis only on the economic
return for shareholders. This stated desire to be a good corporate citizen with a long-
term view of the world can motivate efforts that achieve both economic return for share-
holders and other positive benefits for many other stakeholders.
MISSION STATEMENT The vision should lead into the mission statement, which is
a way to accomplish the vision. The mission statement includes the organization s core
purpose, core values, beliefs, culture, primary business, and primary customers. 3 Several
of these sections may flow together in the mission statement and, sometimes, an overall
statement is formed with expanded definitions of portions for illustration. The rationale
for including each section (either as one unified statement or as separate statements) is
as follows:
By including the organization s purpose, the mission statement communicates why
the organization exists.
By including the organization s core values, a mission statement communicates how
decisions will be made and the way people will be treated. True organizational
EXHIBIT 2.2
SWOT ANALYSIS FOR THE BUILT GREEN HOME AT SUNCADIA
STRENGTHS WEAKNESSES
Green building has a buzz
Seattle has a strong green building community
support
Strong community support
Growth in green building projects that demon-
strate value
Need to provide numbers on green building value
Committed developer and builder
Green building has not reached mainstream
Limited project resources community Distance
away from Seattle Green building is perceived
to be costly
High cost of green projects
OPPORTUNITIES THREATS
Uniqueness of product
Location
Existing thinking on green building and its
niche focus
Community surrounding house Building schedule
Lack of data on green building (wealth) value Community (location)
Rumors
Source: Brenda Nunes, developer, Built Green Home at Suncadia.
Chapter 2 Project Selection and Prioritization 35
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values describe deeply held views concerning how everyone should act especially
when adhering to those values is difficult.
By including beliefs, a mission statement communicates the ideals for which its lea-
ders and members are expected to stand. Beliefs are deeply held and slow to change,
so it is quite useful to recognize them, as they can either help or hinder an organiza-
tion s attempt to achieve its vision.
By including the organization s culture, the mission statement instructs and expects
members to act in the desired manner.
By including the primary business areas, everyone will know in what business the
organization wishes to engage.
By identifying the primary customers, everyone will understand which groups of
people need to be satisfied and who is counting on the organization. The mission
needs to be specific enough in describing the business areas and customers to set
direction, but not so specific that the organization lacks imagination.
An example of a vision and mission statement from Cincinnati Children s Hospital
Medical Center is shown in Exhibit 2.3.
2-1c Strategic Objectives
With the strategic analysis, mission, and vision in place, leaders turn to setting strategic
objectives, which should be the means of achieving the mission and vision. For most
organizations, this strategic alignment of objective setting occurs annually, but some
organizations may review objectives and make minor revisions at three- or six-month
intervals. While the planning is normally performed annually, many of the strategic
objectives identified will take well over one year to achieve. The objectives describe both
short- and long-term results that are desired, along with measures to determine achieve-
ment. Organizations that embrace a triple bottom line in their guiding values will have
objectives promoting each bottom line, and projects that are selected will contribute
toward each. These objectives should provide focus on decisions regarding which
EXHIBIT 2.3
CINCINNATI CHILDREN S HOSPITAL MEDICAL CENTER VISION AND MISSION
Cincinnati Children’s Hospital Medical Center will be the leader
in improving child health.
Cincinnati Children’s will improve child health and transform delivery of care
through fully integrated, globally recognized research, education, and
innovation. For patients from our community, the nation and the world,
the care we provide will achieve the best:
• Medical and quality of life
• Patient and family and

today and in the future.
Source: Cincinnati Children s Hospital Medical Center, http://www.cincinnatichildrens.org/about/mission/, accessed
January 9, 2017.
36 Part 1 Organizing Projects
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projects to select and how to prioritize them, since they are an expression of the organi-
zational focus. Many writers have stated that for objectives to be effective, they should be
SMART that is, specific, measurable, achievable, results based, and time specific. 4 An
example of strategic objectives from The Internet Society is shown in Exhibit 2.4.
2-1d Flow-Down Objectives
Once an organization s strategic objectives are identified, they must be enforced. Some
objectives may be implemented by work in ongoing operations. However, projects tend
to be the primary method for implementing many objectives. If the organization is rela-
tively small, leaders may proceed directly to selecting projects at this point. Larger orga-
nizations may elect a different route. If the organization is so large that it is impractical
for the overall leaders to make all project selection decisions, they might delegate those
decisions to various divisions or functions with the stipulation that the decisions should
be aligned with the organization s strategic planning that has taken place to this point.
Regardless of whether the organization is small and the top leaders make all project
selection decisions or whether the organization is large and some of the decisions are
cascaded one or more levels down, several methods of project selection may be used.
2-2 Portfolio Management
Companies that use a strategic project selection process to carefully align projects with
their organizational goals will find they tend to be more successful at completing their pro-
jects and deriving the expected benefits from them. Portfolio management is the central-
ized management of one or more portfolios to achieve strategic objectives.5 The goal of
portfolio management is to achieve the maximum benefit toward the strategic goals of
the company. To accomplish this, executives need to identify, select, prioritize, resource,
and govern an appropriate portfolio of projects and other work. 6 Governing will be cov-
ered in Chapter 14, and all other portfolio management topics will be covered here. Project
success at these companies is measured by how much the project contributes to the orga-
nization s objectives (business needs) as well as the traditional measures of staying within
budget and schedule and achieving the specific technical goals promised at the start of the
project to obtain a desired return on investment.
For ease of understanding how various work is related, many organizations utilize an
approach of classifying portfolios, programs, projects, and subprojects. Not all companies
use all four classifications, but understanding how they are related helps one see where
any particular portion of work fits in the organization.
PORTFOLIO EXAMPLE We are a major national health insurance company. Our
planning approach starts with creating an inventory of project initiatives, which has
been identified by the key business areas. We separate the projects into foundational pillars
EXHIBIT 2.4
INTERNET SOCIETY STRATEGIC OBJECTIVES FOR 2012 2014 PLANNING CYCLE
1. Facilitate and promote policy environments that enable the continued evolution of an open and trusted Internet.
2. Increase the global relevance of collaborative, bottom-up, technical, consensus-based, open standards development.
3. Strengthen Internet Society leadership in Internet Development.
4. Build the visibility and influence of the Internet Society as the trusted source on global Internet issues.
Source: http://www.internetsociety.org/who-we-are/organization-reports-and-policies/internet-society-2015-action-plan, accessed February 7, 2017.
Chapter 2 Project Selection and Prioritization 37
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(operation functions) and develop roadmaps of activities going out six quarters (18
months) as can be seen in Exhibit 2.5. Priority and timing of business need determine
which quarter(s) the project initiatives are developed and implemented. The roadmaps
also include smaller activities called capabilities that are integrated with the project activi-
ties. Each of these foundational pillars aligns with the supporting agile sprint teams and
the backlog of activities gets translated into stories within the sprints. A key role is the
Product Owner who represents the business area and determines which activities (stories)
go into each sprint. There is one Product Owner for each pillar and they are at a Director
level within the organization. The product owner must have a complete understanding of
the organizations strategy and short-term goals of their respective business area.
2-2a Portfolios
Organizations require many work activities to be performed, including both ongoing
operational work and temporary project work. Large organizations often have many pro-
jects underway at the same time. A portfolio is projects, programs, subportfolios, and
operations managed as a group to achieve strategic business objectives. 7 Project portfo-
lios are similar to financial portfolios. In a financial portfolio, efforts are made to diver-
sify investments as a means of limiting risk. However, every investment is selected with
the hope that it will yield a positive return. The returns on each investment are evaluated
individually, and the entire portfolio is evaluated as a whole.
Each project in the portfolio should have a direct impact on the organization. Put
another way, an organization s leaders should identify the organization s future direction
through strategic planning. Then multiple possible initiatives (or projects) can be identi-
fied that might help further the organization s goals. The leaders need to sort through
the various possible projects and prioritize them. Projects with the highest priority
EXHIBIT 2.5
2017 PROJECT & ROADMAP PLANNING
Carry Over – 121 Projects
New Business
Care4U
Claims
Consumer Exp.
Finance, Billing and Enroll.
Provider
Reg/Complince
23
64
9
6
3
10
6
Backlog – 75 Projects
New Business
Care4U
Claims
Consumer Exp.
Finance, Billing and Enroll.
Provider
Reg/Complince
n/a
37
9
3
11
13
2
Dashboard
Initial Draft
Complete
Dashboard
Initial Draft
Complete
Dashboard
In Progress
Dashboard
In Progress
Dashboard
Not Started
Source: Mark Heitkamp, PMP, MBA and appear after the words business area
38 Part 1 Organizing Projects
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should be undertaken first. Organizations typically try to have a sense of balance in their
portfolios; that is, an organization includes in its portfolio:
Some large and some small projects
Some high-risk, high-reward projects, and some low-risk projects
Some projects that can be completed quickly and some that take substantial time to finish
Some projects that serve as efforts to enter new markets and new products or
services and some to improve current products
2-2b Programs
A program is a group of related projects, subprograms, and program activities managed
in a coordinated way to obtain benefits not available from managing them individually. 8
This group of related projects or the program often shares the same goal and requires
similar resources.
Program management is defined as applying knowledge, skills, tools, and techniques
to meet requirements and to obtain predetermined benefits. It is a systematic approach
of aligning multiple components of the program to achieve the program goals while
optimizing the integrated cost, schedule, and effort required to execute the program.
Programs and program management are of great importance, specifically for the govern-
ment and large and multinational corporations.
Programs often last as long as the organization lasts, even though specific projects
within a program are of limited duration. For example, the U.S. Air Force has an engine
procurement program. As long as the Air Force intends to fly aircraft, it will need to
acquire engines. Within the engine program are many individual projects. Some of
these projects are for basic research, some are for development of engines, some are for
purchasing engines, and a few others are for maintaining and improving the perfor-
mance of engines in use. Each project has a project manager, and the entire program
has a program manager. While the project managers are primarily concerned with the
trade-offs associated with cost, schedule, scope, and quality on their individual projects,
the program manager is concerned with making trade-offs between projects for the max-
imum benefit of the entire program. To avoid confusion, programs deal with a specific
group of related projects, while a portfolio deals with all of an organization s projects.
A portfolio can include multiple programs as well as multiple projects.
A program may include components such as portfolios, projects, and subprograms. It
is important to understand comparative analysis of projects, programs, and portfolios.
While the leadership group of a company may make portfolio decisions and delegate
the program management decisions to a program manager, both portfolios and programs
are managed at a level above the typical project manager. For practical purposes, project
managers should attempt to understand how both portfolio and program decisions
impact their projects and then spend most of their efforts focused on their project.
Some of the unique responsibilities of a program manager are leading program activi-
ties in a coordinated way, communicating with internal and external stakeholders, resolv-
ing cost, scope, schedule, risk, and quality across all projects with shared governance, and
managing external and internal factors such as culture and socioeconomic issues. See
Exhibit 2.6 for a comparison of projects, programs and portfolios.
2-2c Projects and Subprojects
Just as a program is made up of multiple projects, a large project may be composed of
multiple subprojects. A subproject is a part of a larger project organized as a project
Chapter 2 Project Selection and Prioritization 39
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itself to make it easier to plan and manage. If the project is quite large, individuals may
be assigned as subproject managers and asked to manage their subproject as a project.
Some of those subproject managers may even work for another company. The project
manager needs to coordinate the various subprojects and make decisions that are best
for the overall project. Sometimes this may require that a particular subproject be sacri-
ficed for the greater good of the project. The relationships among a portfolio, programs,
projects, and subprojects are illustrated in Exhibit 2.7.
EXHIBIT 2.6
COMPARISON OF PROJECTS, PROGRAMS, AND PORTFOLIOS
PROJECTS PROGRAMS PORTFOLIOS
Scope Defined scope
Progressive elaboration
Larger scope
Significant benefits
Organizational scope
Changes with strategic goals
Change Change is norm
Change management
Internal and external
changes
Changes due to external and
internal environment
Plan Detailed plans High-level program plan
Detailed component plan
Create processes
Maintain processes
Monitor Project deliverables Progress of program
components
Strategic changes, risk
Resource allocation
Success Scope quality, cost, time
Customer satisfaction
Needs and benefits
of the program
Investment performance
Benefit realization
Manage Project deliverables
Project team
Program staff and PM
Vision and leadership
Portfolio staff
Adopted from PMI, Standard for Program Management, 3rd ed. (2013): p. 8.
EXHIBIT 2.7
PORTFOLIO, PROGRAM, PROJECT, AND SUBPROJECT RELATIONSHIPS
Company Portfolio
Program Alpha Program Beta
Project
A1
Project
A2
Project 3
Subproject 3.1
Subproject 3.2
40 Part 1 Organizing Projects
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Because projects are frequently performed in a fast-paced environment, it is helpful if
they can be guided by organizational priorities.
The first step is to carefully align potential projects with the parent organization s goals.
While many companies are motivated to align projects with organizational goals for these
benefits, an additional reason for companies that sell to the government is that the Federal
CIO Roadmap states, CIOs are responsible for maintaining and facilitating the imple-
mentation of a sound and integrated IT architecture; monitoring performance of IT pro-
grams; using metrics to evaluate the performance of those programs; and modifying or
terminating programs or projects. 9 This was introduced in the Sarbanes-Oxley require-
ments. All publicly traded companies must now follow certain guidelines that require
some sort of financial decision model for selecting projects for execution.
When managers assess the organization s ability to perform projects and then iden-
tify, select, prioritize, resource, and govern a portfolio of projects and other work that
they believe will help the organization achieve its strategic goals, they are performing
portfolio management. While a team of senior executives may conduct many of the port-
folio management activities, project managers should understand how their specific pro-
jects are aligned with the organization s objectives since they will need to either make or
provide input on many decisions.
When organizations consider their entire portfolio of work, they sometimes envision pro-
jects as means of developing knowledge that can be capitalized upon in ongoing work pro-
cesses to provide profit, as shown in Exhibit 2.8. Furthermore, new knowledge encourages
organizations to be creative and develop new project ideas and knowledge-building projects.
In times when the economy is poor, many companies struggle to get enough business. In
such an environment, some firms might accept almost any work they can get. Even during
bleak economic times, however, one should be careful how internal projects are selected,
since selecting one project limits resources (money, people, etc.) available to other projects.
EXHIBIT 2.8
PORTFOLIO OF PROJECTS AND OPERATIONAL WORK PROCESSES
Little Kn Reliable Kn
Knowledge ContinuumKnowledge Continuum
Examples:
Basic R&D;
Customer Research;
M&A Due Diligence
Examples:
Competitive Strategy;
Product Development;
Market Entry;
Channel Strategy
Inbound Logistics
Operations
Outbound Logistics
Sales and Marketing
Customer Service
Manufacturing
Procurement
Human Resources
Both projects and processes are intertwined to create sustainable value.
Source: Chinta, Ravi, and Timothy J. Kloppenborg, Projects and Processes for Sustainable Organizational Growth,
SAM Advanced Management Journal 75 (3) (Spring 2010): 24.
Chapter 2 Project Selection and Prioritization 41
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During good or bad economic times, people should take the same care and prudence with
external projects and ensure that they are consistent with the organization s goals.
2-2d Assessing an Organization s Ability to Perform Projects
Assessing an organization s strengths and weaknesses is an essential part of aligning projects
with the organization. If an organization does not have the right capabilities, a project that
may otherwise support organizational goals may be too difficult to successfully complete.
Some questions to ask regarding a firm s ability to support projects are as follows:
Do we have the right skills, capabilities, technical knowledge, and resources that are
required for potential projects? If we do not have them, can we acquire them easily?
Do we have a teamwork attitude, free and open communication, creativity, and
empowered decision making?
Do we have a clearly defined project management process?
Do our associates have the right attitudes, skills, and competencies to use the project
management process?
Are our leaders at each level willing to take appropriate personal risk?
Does senior leadership establish a strong leadership foundation?
Do individuals and teams exhibit leadership at their respective levels?
Do we monitor and understand our external environment?
2-2e Identifying Potential Projects
The second part of aligning projects with the firm s goals is to identify potential projects. In
general, some potential projects can be to capitalize upon a strategic opportunity or techno-
logical advance. Others may serve a social need, an environmental consideration, a customer
request, or a legal requirement. Ideally, this is accomplished in a systematic manner not
just by chance. Some opportunities will present themselves to the organization. Other good
opportunities will need to be discovered. All divisions of the organization should be involved.
This means people at all levels, from frontline workers to senior executives and people from
all functional areas need to help identify potential projects. For example, salespeople can
uncover many opportunities by maintaining open discussions with existing and potential
customers, and operations staff may identify potential productivity-enhancing opportunities
as projects. Everyone in the firm should be aware of industry trends. Many industries have
trade journals such as Elevator World or Aviation Week and Space Technology that can be
reviewed regularly for potential project ideas. One reasonable goal is to identify approxi-
mately twice as many potential projects as the organization has time and resources to per-
form. The reason is simple: under close examination, some potential projects may not be a
good fit. Any company that accepts practically every potential project will probably waste
some of its resources on projects that do not support its organizational goals.
Once potential projects are identified, the next step is to develop a brief description of
each. The leadership team that will select and prioritize projects needs to understand the
nature of the projects they are considering. While the level of documentation different
firms require varies greatly, a bare minimum can be called the elevator pitch. This is
when a person meets another waiting for an elevator and asks, I hear you are on XYZ
Project. What is it all about? The responder may have only a brief time to give a reply
before the elevator arrives and must be prepared to answer quickly with simple state-
ments about the project work and why it is important to the organization.
The work is often summarized in a brief statement of work, which is a narrative
description of products, services, or results to be supplied. 10 Why the project is important
42 Part 1 Organizing Projects
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is often summarized as a business case, which is the benefits of a selected component
used as a basis for the authorization of further project management activities. 11
The business case generally includes both why the project is needed and, if the firm
uses financial justification as part of project selection, an estimate of costs and benefits.
Armed with this elevator pitch, the series of processes that collectively are used to select,
prioritize, and initiate projects begins. Selecting and prioritizing are covered next, and
chartering is covered in Chapter 3.
METHODS FOR SELECTING PROJECTS The people in charge of selecting projects
need to ensure overall organizational priorities are understood, agreed upon, and com-
municated. Once this common understanding is in place, it is much easier to prioritize
potential projects. The degree of formality used in selecting projects varies widely. In a
smaller organization, it can be straightforward. The prioritization should consider criteria
derived from project management, finance, and strategic aspects and should include ask-
ing questions such as these:
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 it feasible to complete the project within the expected time and at the projected
cost while managing associated risks?
Is the project financially beneficial and compatible with other investment decisions?
Is there enthusiastic support both from external customers and from one or more
internal champions?
Which projects will best help the organization achieve its strategic goals?
There are several different methods of systematically selecting projects. The methods
include both financial and scoring models. The primary reason for including financial
analysis either to make the project selection decisions directly or to at least assist in
the decision making is that, from management s perspective, projects are investments.
Therefore, proper selection should yield a portfolio of projects that collectively contribute
to organizational success.
Three different approaches are commonly used to ensure both financial and nonfi-
nancial factors are considered when selecting projects. First, some organizations use
financial analysis as the primary means of determining which projects are selected, and
management merely tempers this with informal inclusion of nonfinancial factors. Sec-
ond, some organizations use financial models as screening devices to qualify projects or
even just to offer perspective; qualified projects then go through a selection process using
a scoring model. Third, at still other organizations, financial justification is one factor
used in a multifactor scoring model. The common thread in all three of these approaches
is that both financial and nonfinancial factors are considered when selecting projects. Let
us consider both financial and scoring models. Financial models will be covered in con-
cept, but the calculations will not be shown since they are explained in depth in most
required finance courses. Scoring models will be covered in both concept and calculation
since many students might not have them in another course.
2-2f Using a Cost-Benefit Analysis Model to Select Projects
Cost-benefit analysis is a financial analysis tool used to determine the benefits provided
by a project against its costs. 12 These models compare expected project costs to expected
project benefits. Several models can be used in making project selection decisions.
Chapter 2 Project Selection and Prioritization 43
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NET PRESENT VALUE (NPV) Net present value (NPV) is the most widely accepted
model and will be covered first. When using net present value, the analyst first discounts
the expected future value of both the project costs and benefits, recognizing that a dollar
in the future is worth less than a dollar today. Then the analyst subtracts the stream of
discounted project costs from the stream of discounted project benefits. The result is the
net present value of the potential project. If the net present value is positive, then the
organization can expect to make money from the project. Higher net present values pre-
dict higher profits. See the summary in Exhibit 2.9.
BENEFIT-COST RATIO (BCR) A second financial model sometimes used is benefit-
cost ratio (BCR). The ratio is obtained by dividing the cash flow by the initial cash out-
lay. A ratio above 1.0 means the project expects to make a profit, and a higher ratio than
1.0 is better. The cash flow can be determined for the life of the project using net present
or discounted value principles.
INTERNAL RATE OF RETURN (IRR) The third financial model is internal rate of
return (IRR). In this model, the analyst calculates the percentage return expected on the
project investment. A ratio above the current cost of capital is considered positive, and a
higher expected return is more favorable.
PAYBACK PERIOD (PP) The fourth financial model that is sometimes used is the
payback period (PP). In this analysis, a person calculates how many years would be
required to pay back or recover the initial project investment. The organization would
normally have a stated period that projects should be paid back within, and shorter pay-
back periods are more desirable.
ADVANTAGES AND DISADVANTAGES OF EACH METHOD Financial models are
useful in ensuring that selected projects make sense from both cost and return-
on-investment perspectives. These models have weaknesses that need to be understood
before they are used. For example, payback period models do not consider the amount of
profit that may be generated after the costs are paid. Thus, two projects with a similar pay-
back period could look equal, but if one has substantially higher revenue after the payback
period, it would clearly be superior. BCR would not be acceptable unless all costs and bene-
fits were calculated in present dollars (in which case it is similar to NPV except it is a ratio
of benefits to cost instead of the difference between revenue and cost). However, there
EXHIBIT 2.9
FINANCIAL MODELS FOR PROJECT SELECTION
NET PRESENT
VALUE (NPV)
BENEFIT-COST
RATIO (BCR)
INTERNAL RATE
OF RETURN (IRR)
PAYBACK PERIOD
(PP)
Calculation PV revenue PV cost Cash flow/Project
investment
Percentage return on
project investment
Project costs/Annual
cash flows
Neutral Result NPV $0 Ratio 1 0 IRR Cost of capital Payback period
Accepted length
If used to screen projects or
to select projects outright
NPV > Acceptable
amount
Ratio > Acceptable
amount
IRR > Acceptable
amount
Payback period < Acceptable length If used to compare projects Higher NPV better Higher ratio better Higher IRR better Shorter payback period better 44 Part 1 Organizing Projects 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 are benefits and costs that are intangible and cannot be determined in financial terms. IRR and BCRs have problems if used for choosing between mutually exclusive projects because they can favor smaller projects that create less total value for the firm but have high percentage returns. For example, a huge project with a medium rate of return would create a lot of value for a firm but might not be chosen over a smaller project with a higher return if only one can be chosen. Additionally, it is sometimes quite dif- ficult to calculate an IRR if a project has nonconventional cash flows. For the most part, the finance discipline recommends using net present value. The other measures can be calculated to provide perspective on whether a project meets a minimum financial return threshold or to communicate with people who might not understand NPV. However, none of the financial models ensure alignment with an organization s stra- tegic goals. Therefore, financial analysis, while very useful, is normally not enough. 2-2g Using a Scoring Model to Select Projects In addition to ensuring that selected projects make sense financially, other criteria often need to be considered. A tool called a scoring model helps to select and prioritize poten- tial projects. It is useful whenever there are multiple projects and several criteria to be considered. A few organizations use more complex models such as analytical hierarchy process (AHP) to compare projects, but since many more organizations keep things sim- ple with variations of scoring models, that is what we will cover. IDENTIFYING POTENTIAL CRITERIA These criteria should include how well each potential project fits with the organization s strategic planning. The criteria may also include such items as risk, timing, resources needed, and so on. A normal practice is for the company s leadership team to jointly determine what criteria will be used to select projects. A list of questions executives may use to develop their list of criteria is shown in Exhibit 2.10. DETERMINING MANDATORY CRITERIA Once the leadership team agrees on a list of criteria that are important, the next step is to determine whether any of the criteria are man- datory. That is, are there any situations that dictate a project must be chosen regardless of any other considerations? Examples of this include government mandates and clear safety or EXHIBIT 2.10 EXAMPLES OF PROJECT SELECTION CRITERIA How well does this project fit with at least one organizational objective? How many customers are there for the expected results? How competitively can the company price the project results? What unique advantages will this project provide? Does the company have the resources needed? What is the probability of success? Are the data needed to perform the project available or easily collected? Do the key stakeholders agree that the project is needed? What is the expected return on investment? How sustainable will the project results be? How does this project promote (or hinder) our corporate social responsibility? What risks are there if we do not perform this project? Chapter 2 Project Selection and Prioritization 45 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 security situations. This list of must-do projects should be kept as small as possible since these projects automatically get selected and can crowd out other worthwhile projects. WEIGHTING CRITERIA Next, the leadership team determines the relative importance or weight of each decision criteria. While more complex methods of determining criteria weights and project evaluations have been used in the past, many firms now use the sim- ple methods described here for determining criteria weights. See Exhibit 2.11 for an example of project evaluations. First, executives determine which criterion is most important and give that a weight of 10. Then they ask how important in comparison each of the other criteria is. For example, if the executives in a consumer products com- pany thought development of new products was most important, it would be assigned a weight of 10. If the customer relations factor was deemed almost as important as new product development, maybe it would be assigned 8. If the factors of supplier relations and probability of project success were each deemed to be half as important as new product development, each would be assigned 5. Perhaps other criteria such as cost reduction, safely, and so forth were also considered but determined to not be as impor- tant. The resulting criteria with weights are shown in Exhibit 2.11 in the top row of the selection and prioritization matrix. Most organizations will decide to use about three to five criteria. Lesser-rated criteria can be used as tiebreakers if needed. EVALUATING PROJECTS BASED ON CRITERIA Now the leadership team evaluates each project on each criterion. The most efficient and accurate method is to concentrate on one criterion at a time, going down each column in turn. An easy method for this is to rate each project on that specific criterion, with scores ranging from 1 (potential proj- ect has very little or even negative impact on this criterion) to 5 (project has excellent impact on this criterion). The upper-left portion of each cell in the matrix can display the rating, representing how well that project satisfies that criterion. Once a project has been rated on a specific criterion, that rating should be multiplied by the weight assigned to that criterion and displayed as the weighted score in the main body of each cell. The total for each project should be added across the row. The highest- scoring projects would ordinarily be selected. If several projects have close scores (virtual ties), other criteria or discussion can be used to break the tie. For example, in Exhibit 2.12, there is a virtual tie between Projects A and B. EXHIBIT 2.11 PROJECT SELECTION AND PRIORITIZATION MATRIX Project A Project B Project C Project D 55810 46 Part 1 Organizing Projects 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 SENSITIVITY ANALYSES Scoring models allow leadership teams to perform sensitiv- ity analyses that is, to examine what would happen to the decision if factors affecting it were to change. Selection criteria may be added or altered. Participants may decide that some criteria are more important than others and weight them accordingly. Missing cri- teria or new alternatives can be added and the decision revisited. For example, if the executive team evaluating the projects in Exhibit 2.12 had a bad experience with an unsuccessful project and decided to reevaluate their decisions with success probability now weighted a 9 for very important, the new project selection and priority matrix would be calculated as shown in Exhibit 2.14. Decision makers can ensure that they use very solid ratings for each potential project. For example, if one criterion was the number of customers, the marketing department could interview some potential customers to gauge their level of interest. A company might want to select several projects. If so, the scores from the selection matrix could serve as one method of prioritizing the projects. EXHIBIT 2.12 COMPLETED PROJECT SELECTION AND PRIORITIZATION MATRIX Project A Project B Project C Project D 55810 10252450 25151650 15154010 1053220 5 5 1 2 3 2 5 4 5 3 3 1 2 5 3 2 109 106 80 67 EXHIBIT 2.13 REVISED PROJECT SELECTION AND PRIORITIZATION MATRIX Project B Project A Project C Project D 95810 45151650 18252450 27154010 1853220 5 5 1 2 2 3 5 4 3 5 3 1 5 2 3 2 126 117 92 75 Source: Chris Bridges. Chapter 2 Project Selection and Prioritization 47 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 Selection of projects based on certain criteria is a decision-making process that varies geographically as priorities and thinking styles tend to be different. Due to cultural differences, learning, and education principles, people think and approach a problem differently; therefore, they also adopt different decision-making styles. This aspect assumes importance due to increased diversity in workplaces that provides an opportunity to work with people from different cultures and countries. Due to these factors, someone might rely more on inductive, deductive, or a combination of these approaches in making decisions. This diversity would influence how people look at a scor- ing model or any other decision-making tool in selecting projects and making project port- folio management decisions. These issues are discussed further in Chapter 15. 2-2h Prioritizing Projects Once all projects have been selected, they will need to be prioritized that is, the deci- sion makers will need to determine which ones will get assigned resources and be sched- uled to begin first. If a company selects several projects for a year (or even for a fiscal quarter), it cannot expect to start all of them at the same time. The scoring models are useful in providing input into the starting order of projects. Most leadership teams will consider the weighted scores of each project as a starting point in assigning resources to projects and determining their start dates. The leadership team members, however, also generally discuss other issues, such as: The urgency of each project The cost of delaying the expected benefits from various projects Practical details concerning the timing Opportunity costs associated with the project For example, an important process improvement project may be far less disruptive to perform when the factory is shut down for routine maintenance. One more discus- sion frequently occurs in the prioritizing process if there is a conflict between resource needs for two projects, which one gets the needed resources first? Often, this is left to the project sponsors to iron out; especially for important projects, it may be formally decided by the leadership team. In that way, the probability of the critical project being held up by a misunderstanding is greatly decreased. Exhibit 2.14 shows how the Alternative Breaks (AB) planning committee at a university ranked spring break projects. This exhibit shows four of the twenty-six projects that were selected for trips. This book will include multiple examples of the AB project to illustrate how various project-planning tools work together. Each trip is a small or subproject, while the combination of all twenty-six trips forms the overall project. 2-2i Resourcing Projects Once all projects have been prioritized, it is time to assign resources to each. Resources can include key personnel such as sponsors, project managers, core team members, and subject matter experts. Resources can also include space, materials, equipment that may be in short supply, and the funds necessary to acquire these resources. The easiest way is to use a resource assignment matrix and begin by assigning resources to the highest-priority projects. Once an individual resource is no longer available, the organization is limited in the number of projects that it can take on during a particular time. Assigning resources like this requires a prioritized project list such as shown in Exhibit 2.13, a list of resources and how much of each is available, and an estimate of how much of each key resource each project will need. For simplicity s sake, organizations often plan for a fiscal quarter. Exhibit 2.15 shows the same four projects and choices of project 48 Part 1 Organizing Projects 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 managers, team members, and the budget for each. Note that while there is enough project manager time to start all four projects, there is neither enough team member time nor enough cash. Therefore, only three projects can be started. 2-3 Securing Projects The discussion above pertains to projects that are internal to an organization. This section deals with projects a company (called the client) wants performed, but for which it may hire external resources (called contractors) to execute significant parts or all of the work. External projects can be viewed either from the perspective of the client company that wants the project to be executed or from the perspective of the contractor company that wants to perform the EXHIBIT 2.14 ALTERNATIVE BREAKS PROJECT SELECTION AND PRIORITIZATION MATRIX PROJECT/SELECTION CRITERIA ACTIVE SERVICE OPPORTUNITY ISSUE ITSELF ORGANIZATION TO WORK WITH COST 9 10 6 5 Total New York Vegan Farm 5 45 4 40 3 18 4 20 123 West Virginia Sustainability 4 36 3 30 4 24 5 25 115 Chicago Halfway House 2 18 4 40 4 24 4 20 102 El Salvador Cultural Immersion 1 9 5 50 5 30 1 5 94 EXHIBIT 2.15 RESOURCE ASSIGNMENT MATRIX PROJECT/RESOURCE PM/DEJI PM/BUD PM/CORY TEAM/ BRADLEY TEAM/ RAJEEV TEAM/ LARRY MONEY Maximum Availability 200 400 300 300 150 150 $30 million Project List Project B: PM 240, Team 200, $5M 240 200 $5M Project A: PM 200, Team 150, $10M 200 150 $10M Project C: PM 300, Team 150, $14M 300 150 $14M Project D: PM 150, Team 180, $4M Remaining Availability 0 160 0 100 0 0 $1M Chapter 2 Project Selection and Prioritization 49 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 work. Client companies may first put prospective external projects through a selection and prioritization process as described above and, if selected, then decide whether to perform the work internally (make) or hire the project to be performed by others (buy). If the decision is to buy, then the client company needs to plan and conduct the procurement. Contractor companies need to identify potential project opportunities, determine which they will pursue, submit proposals, and be prepared to either bid or negotiate to secure the work. We consider the client company s perspective in Chapter 12, Project Supply Chain Management. We consider the contractor s perspective next. 2-3a Identify Potential Project Opportunities Contractors seeking external projects to perform should pursue this in a fashion similar to that of any company considering internal projects, as described earlier in this chapter in the portfolio alignment section on identifying potential projects. Additionally, since they need to look for projects externally, contractor companies should have representatives at trade shows, professional conferences, and anywhere information on the intentions of potential customers and competitors may surface. Contractor companies should also actively practice customer relationship management by establishing and nurturing per- sonal contacts at various levels and functions. Contractor companies can also practice cus- tomer relationship management by linking information systems to the extent practical so as to identify any useful information concerning potential future projects and improve management of current projects. 2-3b Determine Which Opportunities to Pursue Just as all companies should decide which internal projects to select, as previously described in the methods for selecting projects, most contractor companies are best served by targeting the projects they wish to pursue. Some companies have a policy that they will bid on every potential project, knowing that if they do not bid, they will not be awarded the project. More companies find that if they target their opportunities, their hit rate or probability of securing the work on any given proposal increases. It takes time and resources to put together a good proposal, so it makes sense to increase the acceptance rate by developing a bid/no-bid decision strategy. Each company has strengths and weaknesses compared to its competitors. Hence, a quick SWOT analysis could be used to decide whether to pursue a potential project, N ap pi ne ss /p ix ab ay .c om 50 Part 1 Organizing Projects 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 just as a more involved version of SWOT analysis was described earlier and depicted in Exhibit 2.2. Decision makers can also ask how well a potential project will help achieve their objectives. If they determine a project will help achieve their objectives, the next considerations are the cost to pursue the work and the probability of successfully secur- ing the project given the likely competition. A company frequently considers risks both of pursuing and not pursuing a potential project13 Finally, does the company have the capability to perform the work if it is awarded? 2-3c Prepare and Submit a Project Proposal When a firm prepares to submit a proposal, it is really conducting a small project with the primary deliverable of the project being a compelling and complete proposal. The contrac- tor should understand the project s source selection criteria, the basic minimum criteria the sellers have to be fulfilled to get shortlisted. 14 While criteria will vary extensively from one project to another, generally a client will likely want to be convinced that the potential contractor is technically, managerially, financially, and operationally competent. Successful project managers try hard to convince potential clients that they are capable on all four dimensions. A short list of these factors is shown in Exhibit 2.16. 2-3d Negotiate to Secure the Project Negotiation is an approach to redefine an old relationship that is not working effectively or to establish a new relationship. Negotiations should aim at a win-win solution, and the outcome must benefit both the parties involved in negotiations. Once all proposals have been delivered and evaluated, the client company may elect to either award the project or enter into negotiations with one or more potential contrac- tors. On more routine projects, the contract may be awarded at this point. Further clar- ifications and negotiations may follow for complex projects. A client company and a contractor company may negotiate the amount of money to be paid for a project. They may also negotiate the contractual terms, schedule, specific personnel to be assigned to work on the contract, quality standards, reporting mechan- isms, and various other items. A project manager may need to make arrangements with potential suppliers to secure the products and services needed to perform the project. All these considerations will be covered in subsequent chapters. Successful project managers understand that they need to prepare well for negotiations. This starts with a clear understanding of what is most important to their management. Often, it includes fact finding with the client company to understand its needs and abili- ties. Armed with an understanding of both perspectives, a project manager attempts to find a solution that allows the organization to secure the project work with enough profit potential and with the start of a good working relationship with the client. In the end, the client company will select the contractor(s) and award the contract(s). EXHIBIT 2.16 TYPICAL SOURCE SELECTION CRITERIA TECHNICAL MANAGEMENT FINANCIAL OPERATIONAL Technical experience Management experience Financial capacity Production capacity Needs understanding Project charter Life cycle cost Business size and type Technical approach Planning and scheduling Cost basis and assumptions Past performance Risk mitigation Project control Warranties References Chapter 2 Project Selection and Prioritization 51 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 PMP/CAPM Study Ideas You won t see a whole lot of questions on either of these tests pertaining to portfolio or pro- gram management, since these happen at an executive level, beyond the purview of individual projects or project managers. At the same time, it is imperative that you understand the inter- relationship of portfolio and project management, as well as how they relate to an organiza- tion s mission: the mission leads to strategic objectives, and projects are the primary vehicle through which these objectives are achieved. As with other chapters, make sure you are familiar with the PMBOK terms especially statement of work and business case and be prepared to put them into context with real projects. You will ultimately need to know how to calculate net present value. Finally, be familiar with the common causes of project failure and how to prevent them. Summary Project selection does not occur in isolation. Ideally, it begins with the organization s strategic planning. This planning begins with a strategic analysis of the organi- zation s internal strengths and weaknesses as well as the external threats and opportunities it faces. The organization should then develop its guiding principles such as mission and vision statements. Most companies will have an annual planning session in which strategic objectives are developed. Larger organizations will con- tinue this effort with one or more levels of planning in which the overall objectives are flowed down to deter- mine objectives that are appropriate for each organiza- tional level. Once the strategic planning is accomplished, the organization s leadership team engages in portfolio management. The first part is an open and honest assessment of the organization s ability to perform projects. The decision makers need to understand how many resources are available, the organization s overall capabilities, and the capabilities of the indivi- duals who will be assigned to projects. An ongoing portfolio management activity is for everyone in the firm to identify possible opportunities that they feel might help the organization achieve its goals. Each potential project should be described at least by stat- ing in a sentence or two what work is involved and how it would help the organization achieve one or more of its goals. Once potential projects are identified and briefly described with statements of work and business cases, they should be put through a process to determine which will be selected and what their relative priorities are. Both financial and scoring models are frequently used to evalu- ate potential projects. Net present value is the preferred financial method, although others are sometimes used. Financial analysis tells the leadership team how much each potential project is worth from a benefits- versus-cost comparison, but it does not tell how each potential project may help to achieve the organization s goals. Scoring models can incorporate various goals and should also be used. Once a project list is selected, the projects need to be prioritized so some can start right away and others can start later. Contractor companies need to be constantly on the lookout for potential project opportunities. Once potential projects are identified, companies need to decide which ones they pursue. Just as for internal pro- jects, some external projects will be better at helping an organization reach its goals because they are a better fit. The contractor needs to prepare and submit proposals for desired projects and be prepared to follow up and often negotiate in order to secure them. Key Terms Consistent with PMI Standards and Guides portfolio management, 38 portfolio, 38 program, 38 vision, 38 mission statement, 38 strategic objectives, 38 program management, 38 cost benefit analysis, 38 subproject, 39 statement of work, 42 business case, 42 source selection criteria, 50 52 Part 1 Organizing Projects 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 Chapter Review Questions 1. List and describe each step in the strategic plan- ning process. 2. Name at least four things that a mission state- ment should include. 3. What does the strategic analysis acronym SWOT stand for? 4. What is the most widely accepted financial model for selecting projects? 5. What are some advantages and disadvantages of using a financial model for selecting projects? 6. What are some advantages and disadvantages of using a scoring model for selecting projects? 7. What are some common reasons for project failure? 8. Who should be involved in identifying potential projects? 9. If there is a conflict between resource needs for two projects, who decides which one gets the needed resources first? 10. In a project scoring model, why is each decision criteria given a weight? 11. What purpose do sensitivity analyses serve in using scoring models to choose projects? 12. If several projects have close scores as the result of a scoring model, what can be done to break the vir- tual tie? 13. Why might a contractor company perform a SWOT analysis prior to bidding on a potential project? 14. Why is it important for a contractor to under- stand the source selection criteria a client uses to decide to whom they will award a project? 15. Name five things that may be negotiated between a client company and a contractor company. Discussion Questions 1. How might the internal and external parts of a SWOT analysis affect one another? 2. Describe the interaction between vision and mission statements. 3. How is a company s portfolio similar to and different from a financial portfolio? 4. What is the best way for an organization to prioritize among selected projects? Does it vary among organizations? 5. Why is aligning potential projects with the parent organization s goals the first step in avoiding project failure? 6. Why is it a good practice for organizations to identify twice as many potential projects as they plan to implement? 7. Suppose you are purchasing a new car, and you decide to use a scoring model to decide among four options. What would be your top three criteria, and what would be each criterion s relative weight? 8. Under what circumstances should a selected project take precedence over other selected projects? 9. If you are a contractor looking for project work, why might you decide not to pursue a particular project opportunity? 10. What are the four main areas of competency a client company is looking for in a project man- ager? How can you best demonstrate these com- petencies to a potential client? PMBOK ® Guide Questions 1. A collection of projects, programs, and opera- tions managed as a group to achieve strategic objectives is called a: a. process b. portfolio c. subprogram d. life cycle 2. Projects may be undertaken as a result of any of the following strategic reasons except: a. social need b. market demand c. need to keep workers busy during slow times d. environmental considerations 3. A narrative description of products, services, or results to be delivered by the project is a/an: a. request for information b. business case c. project statement of work d. elevator pitch 4. All of the following statements are true except: a. A portfolio may contain multiple programs and projects. Chapter 2 Project Selection and Prioritization 53 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 b. A project manager has the discretion to make trade-offs in regard to which programs to pursue. c. A program manager has the discretion to make trade-offs in regard to which projects to pursue. d. Projects have a finite timeline, while programs may exist as long as the parent organization does. 5. Which of the following is a financial analysis tool that an organization may use to determine the cost-value of potential projects? a. Payback period (PP) b. Internal rate of return (IRR) c. Net present value (NPV) d. All of the above 6. All projects should be aligned with their organi- zation s strategic plan, which includes the organi- zation s vision, goals, and objectives. Which of these describes an organization s vision? a. Conveys a larger sense of organizational pur- pose, and is both inspiring and guiding b. Describes short- and long-term results along with measures to determine if they have been achieved c. Includes the organization s core purpose, core values, beliefs, culture, primary business, and primary customers d. Is SMART: specific, measurable, achievable, results-based, and time-specific 7. The best describe(s) why a project is being undertaken. a. statement of work b. business case c. subprojects d. source selection criteria 8. The document that includes the necessary information to determine whether a project is worth the required investment, and is used for decision making by upper management, is called the: a. project scope statement b. project charter c. business case d. case study 9. An organization s vision often includes reference to its social, environmental, and economic health, collectively referred to as the: a. triple bottom line b. business case c. statement of work (SOW) d. net present value (NPV) 10. A business case typically contains information regarding the business need and a financial anal- ysis. Which model divides the cash flow by the initial cash outlay? a. Benefit-cost ratio (BCR) b. Internal rate of return (IRR) c. Net present value (NPV) d. Payback period (PP) Exercises 1. Complete the following scoring model. Show all your work. Tell which project you would pick first, second, third, and last. How confident are you with each choice? If you lack confidence regarding any of your choices, what would you prefer to do about it? 2. Complete the following scoring model. Show all your work. Tell which project you would pick first, second, third, and last. How confident are you with each choice? If you lack confidence regarding any of your choices, what would you prefer to do about it? Project A Project B Project C Project D 4610 4 3 2 1 3 2 4 3 5 3 3 4 Project A Project B Project C Project D 3710 1 3 5 2 3 5 4 3 4 3 3 1 54 Part 1 Organizing Projects 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 3. Pretend you are on the leadership team for a phar- maceutical company that is in a difficult financial situation due to patents that have expired on two of your most profitable drugs. Brainstorm a list of criteria by which you would select and prioritize projects. Weight the criteria. 4. Pretend you are on the leadership team of a manufacturing company that is currently chal- lenged by low-cost competition. Brainstorm a list of criteria by which you would select and pri- oritize projects. Weight the criteria. I N T E G R A T E D E X A M P L E P R O J E C T S SUBURBAN HOMES CONSTRUCTION PROJECT Suburban Homes, like any other real estate company, has many strategic directions to pursue to expand the company operation and increase revenue and profits. To explore and pursue various investment opportunities that would eventually translate into projects, the company developed strategic directions to suc- cessfully invest in real estate. It identified six options for portfolio project management. They are investments in purchasing land for future development, communities for single-family homes, multifamily properties, small-scale apartment buildings, large- scale apartment complexes, and commercial investments. 1. Purchasing land in areas that have potential for future growth makes sense, as the cost of land tends to be sub- stantially cheaper 10 20 years before it is turned into a developed suburban area. At an appropriate opportunity, the land can be improved to add value, or it can be leased or rented to create cash flow. Further, the land can be divided and parts of it can be sold for a profit. However, this option requires a vision for future growth and devel- opment and consequently, risks are also associated with this strategic direction. 2. Building single-family homes in suburban areas is one of the best and most popular strategic directions for growth for companies like Suburban Homes. Most of the clients who are interested in a quality life and view their home as an investment prefer buying single-family homes. Clients realize that it is easy to rent, sell, and finance. 3. Small multifamily properties usually consist of two to four units. They also present similar advantages that are asso- ciated with a single-family home such as easy financing and being a wise investment option for clients while pro- viding a good residence for their family. 4. Small apartment buildings usually consist of 5 to 50 units for clients to reside in. They are more popular among those who prefer urban areas and a busy social life. Clients are usually unmarried or married with no children. These properties can be more difficult to finance because they rely on commercial lending standards. For this invest- ment option, Suburban Homes must look for investment opportunities closer to densely populated areas, and the investor must provide parking areas. 5. Large apartment complexes require that you include pools, a gym, tennis courts, and parking facilities, in addition to other attractions that lure people to choose the complex as a residence. Such a complex requires full-time staff to manage the property, provide safety and security, and pro- vide good customer service. These properties can be very expensive to purchase. However, this investment option provides steady revenue flow. 6. Commercial investment, in its truest sense, is an invest- ment for growth and diversity in a portfolio. The aim of this investment is to lease the property for business. Size, style, and purpose also vary. Clients could range from small business owners to large malls and mega office complexes. This investment option offers a consis- tent cash flow. However, occupancy would depend largely on the local economy and could prove to be risky. Further, investments are of higher magnitude and Suburban Homes is seriously considering this option after establish- ing steady growth in the residential market and improving their financial stability and growth. Given these six options, Suburban Homes has approached you to develop a project selection model to maintain a balanced portfolio. Reference https://www.biggerpockets.com/real-estate-investing/strate- gies-niches Chapter 2 Project Selection and Prioritization 55 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 Semester Project Instructions Your instructor may bring example projects to class and facilitate the assignment of students to the vari- ous project teams. Alternatively, your instructor may ask you to identify potential projects. Therefore, you may or may not be involved in project selection. If your instructor has each student bring in a project idea, you will first need to create your elevator pitch to describe tersely what work is involved in your project and why it is important. Then you and a small team will likely need to select one of the potential projects using a scoring model. Unlike the criteria for selecting among projects in a typical organization, for your class, you may use criteria that will help you learn. You may want to include size and complexity criteria so the project is involved enough for you to benefit by using many of the techniques in this book, but small enough so you can do the work in a reasonable amount of time. Finally, you may need to identify resources to accom- plish the project using a resource matrix. Regardless of whether your project is student or fac- ulty generated, one of the first things you should do when assigned to a project is to learn about the company or other organization that wants the project to be com- pleted. Why did they select this project? Is it a must- do project or did it get chosen over other competing projects? By understanding what makes the project so important, you will make better decisions and will be more motivated through the term. If your project is a must-do project, explain why. If it is not a must-do project, explain how it was selected. Explain where it fits in priority with other work of the organization. CASA DE PAZ DEVELOPMENT PROJECT Casa de Paz is an ambitious project with several dimensions to it. There is a shelter that provides six-month housing for families, along with professional services to support a process of healing and transformation. There is a support group for women that serves residents and nonresidents alike. The early meetings for Casa de Paz include seeking volun- teers to serve on the board and the three main working groups. Then a facilitated meeting is being held to determine the minimal viable product (MVP) to build. This is an open and operating facility. Some of the features that are needed include a director, staff, a building, remodeling the building, funding, a website, programming, and volunteers. Organiza- tional responsibilities also must be defined. An important question is: What can Casa de Paz do quickly without waiting for other things to happen? What are some of the things they need to do concurrently? How many projects can each of the groups (the board and the three working groups) realistically begin right away? Armed with the answers to these questions, each of the probable projects should have an elevator pitch: What is included and why is it important? Then the most critical few projects can be selected, resourced, and chartered. An example of an elevator pitch is: There is a need to acquire a building and there is competition for both buildings under consideration. One building is more attractive than the other as the cost is considerably less although the number of families served would be less. Another elevator pitch is the need for website develop- ment. A fledgling website exists, but there are so many communication, fundraising, volunteer soliciting, and other possible uses of the website that early development is attractive. The elevator pitch could answer the following questions: Why is enhancing the website so important? How can the website help us do other work we desire to perform? Where are we now? What do we want? 56 Part 1 Organizing Projects 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 PROJECT MANAGEMENT IN ACTION Prioritizing Projects at LADD LADD s project prioritization process introduced at the start of this chapter brought along a few sur- prises. It was not a clean and quick process. With a staff of seven directors in the room, all with varying levels of experience and understanding, many con- versations transpired requesting clarification and explanation on why peers used criteria to rank pro- jects higher or lower than the overall average. The wall of the board room was covered with paper that contained projects, numbers, and many markings that could be deciphered only by those involved in the process. Some directors provided unsolicited advice as to why their program s project deserved higher marks. Such requests were generally met with equal banter, advocacy for one s own project, and ultimately ended in a fruitful discussion that resolved any discord. As projects were scored and then ranked, the outcomes were not always predictable. A project such as the film festival emerged as the top priority because it was so closely linked with the scored cri- teria of generating revenue and having a large com- munity impact. Creating an infrastructure for IT needs was last because it would cost a significant amount of money and have no direct return for the individuals LADD supports. From the process, it was evident that a small handful of projects were nonne- gotiable and would require completion in order to establish a base for other larger, more impactful projects. Ultimately, the leadership team was able to create a plan of action that is scheduled to accomplish all of the objectives outlined in the strategic plan in a delib- erate, organized manner within the five-year timeline. LADD s leadership team members assumed the title of project manager for the majority of projects. They will work across departments, employing the strengths of many and be held accountable to their peers weekly when the prioritization plan is reviewed at the direc- tor s meeting. Although in its infancy, LADD has taken the top- ranked 12 projects and broken down quarterly expected outcomes for each. The outcomes may be revenue based and focused on generating income for the organization or task based with a method of planning and implementation. Whatever the method, program managers are held responsible for the project being supervised, and project progress will be reported directly to LADD s board of directors. Such a framework allows for accountability all the way through the organizational structure and a con- clusively better service provision for those who LADD supports.Exhibit 2.16 illustrates the prioritiza- tion process with the highest ranked projects selected by LADD and shows the five criteria used to do so. Re el Ab ili tie s Fi lm Fe st iv al ,C in ci nn at i Chapter 2 Project Selection and Prioritization 57 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 References A Guide to the Project Management Body of Knowledge (PMBOK® Guide), 6th ed. (Newtown Square, PA: Project Management Institute, 2017). Barclay, Colane, and Kweku-Muata Osei-Bryson, Toward a More Practical Approach to Evaluating Programs: The Multi-Objective Realization Approach, Project Management Journal 40 (4) (December 2009): 74 93. Brache, Alan P., and Sam Bodley-Scott, Which Impera- tives Should You Implement? Harvard Management Update, Article reprint no. U0904B (2009). Cannella, Cara, Sustainability: A Green Formula, 2008 Leadership in Project Management 4: 34 40. Caron, Franco, Mauro Fumagalli, and Alvaro Riga- monti, Engineering and Contracting Projects: A Value at Risk Based Approach to Portfolio Balanc- ing, International Journal of Project Management 25 (2007): 569 578. Chinta, Ravi, and Timothy J. Kloppenborg, Projects and Processes for Sustainable Organizational Growth, SAM Advanced Management Journal 75 (2) (Spring 2010): 22 28. Cooper, Robert G., Winning at New Products: Path- ways to Profitable Innovation, Proceedings of PMl Research Conference 2006 (Newtown Square, PA: Project Management Institute, 2006). Daft, Richard L., Management, 9th ed. (Mason, OH: South-Western Cengage Learning, 2010). Eager, Amanda, Designing a Best-in-Class Innovation Scoreboard, Technology Management (January February 2010): 11 13. Evans, R. James, and William M. Lindsay, Managing for Quality and Performance Excellence, 8th ed. (Mason, OH: South-Western Cengage Learning, 2011). State of Federal Information Technology, https://cio. gov/wp-content/uploads/filebase/cio_document_ library/CIO-Council-State-of-Federal-IT-Report- January-2017(12) , accessed April 14, 2017. Kenny, John, Effective Project Management for Stra- tegic Innovation and Change in an Organizational Context, Project Management Journal 34 (1) (March 2003): 43 53. Kloppenborg, Timothy J., Arthur Shriberg, and Jayashree Venkatraman, Project Leadership (Vienna, VA: Management Concepts, 2003). Kloppenborg, Timothy J., and Laurence J. Laning, Strategic Leadership of Portfolio and Project Man- agement (New York: Business Expert Press, 2012). Labuschagne, Les, and Carl Marnewick, A Structured Approach to Derive Projects from the Organiza- tional Vision, Proceedings of PMI Research EXHIBIT 2.16 LADD PROJECT SELECTION AND PRIORITIZATION MATRIX PROJECT MISSION (10) FINANCE (9) WORKFORCE (8) RELATIONSHIPS (8) COMMUNITY (7) TOTAL Film Festival 40 36 32 32 35 175 Expand meaningful community-inclusion activities 50 27 32 40 21 170 Develop Victory Parkway site 50 36 16 40 28 170 Implement vacation/ respite services 40 36 24 24 35 168 Health and Wellness Program 50 18 40 32 21 161 58 Part 1 Organizing Projects 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 Conference 2006 (Newtown Square, PA: Project Management Institute, 2006). Milosevic, Dragan Z., and Sabin Srivinnaboon, A Theoretical Framework for Aligning Project Man- agement with Business Strategy, Project Manage- ment Journal 37 (3) (August 2006): 98 110. Organizational Project Management Maturity Model Knowledge Foundation, 2nd ed. (Newtown Square, PA: Project Management Institute, 2008). PMI Requirements Management: A Practice Guide (New- town Square, PA: Project Management Institute 2016). Practice Standard for Work Breakdown Structures, 2nd ed. (Newtown Square, PA: Project Management Institute, 2006). Reginato, Justin, and C. William Ibbs, Employing Busi- ness Models for Making Project Go/No Go Decisions, Proceedings of PMI Research Conference 2006 (New- town Square, PA: Project Management Institute, 2006). Senge, Peter, Bryan Smith, Nina Kruschwitz, Joe Laur, and Sara Schley, The Necessary Revolution: How Individuals and Organizations Are Working Together to Create a Sustainable World (New York: Broadway Books, 2008). Smallwood, Deb, and Karen Furtado, Strategy Meets the Right Projects at the Right Time, Bank Systems & Technology 46 (4) (June July 2009): 34. The Standard for Portfolio Management, 3rd ed. (New- town Square, PA: Project Management Institute, 2013). The Standard for Program Management, 3rd ed. (New- town Square, PA: Project Management Institute, 2013). Steffey W. R., and V. Anantatmula, International Projects Proposal Analysis: Risk Assessment Using Radial Maps, Project Management Journal 42 (3) (2011): 62 74. Wheatley, Malcolm, Beyond the Numbers PMNetwork 23 (8) (August 2009): 38 43. Zhang, Weiyong, Arthur V. Hill, Roger G. Schroeder, and Keyin W. Linderman, Project Management Infrastructure: The Key to Operational Performance Improvement, Operations Management Research 1 (1) (September 2008): 40 52. http://en.wikipedia.org/wiki/Triple_bottom_line, accessed February 2, 2010. http://www.gcbl.org/about, accessed March 12, 2013. http://www.bia.ca/vision.htm, accessed March 5, 2013. http://ocio.os .gov/s/groups/public/@doc/@os/ accessed February 7, 2017. @ocio/@oitpp/documents/content/prod01_002082 , accessed March 6, 2013. https://topnonprofits.com/examples/vision-statements/, accessed January 9, 2017. http://www.sustainablecleveland.org accessed February 7, 2017. http://www.ecowatch.com/cleveland-a-green-city-on-a- blue-lake-1882095827.html, accessed January 9, 2017. http://www.internetsociety.org/who-we-are/organiza- tion-reports-and-policies/internet-society-2015- action-plan, accessed February 7, 2017. http://pmzilla.com/proposal-evaluation-techniques- source-selection-criteria accessed February 7, 2017. Endnotes 1. https://topnonprofits.com/examples/vision-statem ents/, accessed January 9, 2017. 2. http://www.sustainablecleveland.org accessed Feb- ruary 7, 2017. 3. http://www.ecowatch.com/cleveland-a-green-city-on -a-blue-lake-1882095827.html, accessed January 9, 2017. 4. Lussier, Robert N., and Christopher F. Achua, Lead- ership: Theory, Application, Skill Development, 4th ed. (Mason, OH: Thomson South-Western, 2010): 425. 5. PMI Standard for Portfolio Management, 3rd ed. (2013): 190. 6. Kloppenborg, Timothy J., and Laurence J. Laning, Strategic Leadership of Portfolio and Project Manage- ment (New York: Business Expert Press, 2012): 21. 7. PMI Standard for Portfolio Management, 3rd ed. (2013): 190. 8. PMI Standard for Program Management, 3rd ed. (2013): 178. 9. Federal_CIO_Roadmap-[2010.07.02] , p. 4, accessed February 7, 2017. 10. PMI Practice Standard for Work Breakdown Structures, 2nd ed. (2006): 121. 11. PMI Requirements Management: A Practice Guide (2016): 77. 12. PMI Business Analysis for Practitioners: A Prac- tice Guide (2015): 207. 13. Steffey, W. R., and V. Anantatmula, Interna- tional Projects Proposal Analysis: Risk Assess- ment Using Radial Maps, Project Management Journal 42 (3) (2011): 62 74. 14. http://pmzilla.com/proposal-evaluation-techniques -source-selection-criteria, accessed February 7, 2017. Chapter 2 Project Selection and Prioritization 59 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 C H A P T E R 3 Chartering Projects Planning a project is similar to putting together a large puzzle. If you were to dump a 1,000-piece puzzle on a table, you would probably not start the detailed planning right away by comparing two pieces randomly to see if they fit. You would likely take several preliminary steps. Some of these steps might include turning the pieces so the picture side was visible on each, sorting outside pieces so you could form the boundaries, studying the picture on the box, and sorting by color so you could match pieces more easily. (A few more-organized people may like to count and make sure that there are, indeed, 1,000 pieces.) These prelimi- nary steps make the detailed planning of the puzzle much easier and more effi- cient. If completing projects is analogous to putting puzzles together, then project charters are the initial steps. Initiating a project requires some preliminary actions, including understanding the needs and concerns of stakeholders, most critically the project sponsor. Ball Aerospace & Technologies Corp., Systems Engineering Solutions provides a wide range of air, space, and counterspace engineering and professional ana- lytic services. At Ball, we increase stakeholder buy-in by addressing and thinking about things up front; with an agreed-upon charter, this gives the project team CHAPTER OBJECTIVES After completing this chapter, you should be able to: CORE OBJECTIVES: Describe what a project charter is and why it is critical to project success. List the various ele- ments of a charter and why each is used. Create each section of a charter for a small sample project using given project information. TECHNICAL OBJECTIVES: Initialize a project in Microsoft Project and set up a milestone schedule. BEHAVIORAL OBJECTIVES: Work with a team to create a complete charter for a real project and present it to a sponsor for ratification. Negotiate with the project sponsor to develop a realistic and achievable project charter. A Lo t Of Pe op le /S hu tte rs to ck .c om 60 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 some guidance to effectively plan and execute the effort. In addition, by going through the chartering process, stakeholders take ownership in the project. At Ball, our project sponsors are typically U.S. government customers, and we provide work for them on a contractual basis. They provide funding and broad direction for our efforts, and we go through a formal proposal process for all our projects. Project sponsors provide initial statements of work or objectives defin- ing their goals for the task and then select among several proposals from inter- ested companies such as Ball to fulfill their requirements. The chosen company is then under an official formal contract to complete the project. This is, in effect, a pre-chartering process. Typically, after an effort is under contract, a kickoff meeting is scheduled to review the objectives of the project between the project sponsor and the chosen company. This is part of the initiating stage, where stakeholders review and approve the following as part of the project s charter: Overall project objectives Contrast between technical approach as written in the company s proposal for execution and sponsor expectations Milestones, checkpoints, and potential payment plans Success criteria and schedule Identification of key stakeholders and risks Processes for executing, monitoring, controlling, and overall management of the project There are a number of things to consider when initiating a project and generat- ing a project charter. These serve as pieces of the overall puzzle of managing and executing a project. A little pre-work in initiating the project goes a long way, with increased goodwill and understanding from the project sponsor, clear tasks and goals for the project team, and a single way forward toward achieving the pro- ducts and services of the project. Lydia Lavigne, Ball Aerospace This chapter describes what a project sponsor, manager, and team need to understandto quickly initiate a project. The project then proceeds into planning, and the ele- ments of a charter are planned in as much detail as needed. Chapters 5 through 11 describe project planning. 11.2 Identify Risks 11.3 Perform Qualitative Risk Analysis 6.5 Develop Schedule 13.1 Identify Stakeholders Stakeholder Register 11.5 Plan Risk Responses 4.4 Manage Project Knowledge Lessons Learned Register 4.1 Develop Project Charter Project Charter Assumptions Log PMBOK® GUIDE Topics: 4.1 Develop project charter 4.4 Manage project knowledge 6.5 Develop schedule 13.1 Identify stakeholders 11.2 Identify risks 11.3 Perform qualitative risk analysis 11.5 Plan risk responses MAJOR DELIVERABLES Project Charter Assumptions Log Stakeholder Register Lessons Learned Register 61 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 3-1 What Is a Project Charter? For a project manager, team member, or project sponsor, one of the first and most important project management concerns is a project charter. This short document (usu- ally about three pages) serves as an informal contract between the project team and the sponsor (who represents both senior management of the organization and the outside customer, if there is one). From a behavioral perspective, the project charter reflects a common understanding and collaboration between the project sponsor and the project manager. Negotiation skills of the project manager also play an important role in developing the project charter. Since a charter is like a contract, it is helpful to remember what a contract is. First, it is an agreement entered into freely by two or more parties. Second, one party cannot arbitrarily change it. Third, there is something of value in it for each party. Finally, it is a living document that can evolve with changing conditions if both parties agree and receive something of value for making the change. The charter signing represents the transition from the high-level project initiation stage into the more detailed project plan- ning stage. See Exhibit 3.1 for a review of the project life cycle. The project charter is the deliverable that grants a project manager the right to con- tinue into the more detailed planning stage of a project. This may include only permis- sion to plan the project, permission to make decisions that would slow the project if delayed (such as ordering long-lead materials or hiring special workers), or permission to plan and perform the entire project in the case of a small, simple project. Officially, a charter is drafted by either project manager or sponsor and then negotiated; however, as projects are often conducted in a more collaborative fashion, some organizations are assigning core team members early enough that they can help draft the charter. Also, early input from key stakeholders may be considered. While either party (the sponsor or the project manager) can write the rough draft, more often than not, the project manager writes the draft charter. Ideally, then, the proj- ect manager and the sponsor candidly discuss each part of the charter. Like a contract, the people who sign a charter are wise to ensure that they understand and agree to all of it. Unlike a contract, however, both parties feel obligated to the spirit (as opposed to the letter) of the charter since the project details have not yet been worked out and specifics will certainly change. Thinking of a charter like a contract means that both the project manager and the sponsor sign the charter willingly and strive to make the project successful. When core team members have helped write the charter rough draft, they may also sign the charter. If the project man- ager feels bullied into making a change, it is not a free choice. However, the sponsor may legitimately need to insist on receiving the project results more quickly or make some other EXHIBIT 3.1 PROJECT LIFE CYCLE Approval: CharterSelection Kickoff Project BenefitsAdministrative closure realizedresultTo proceed 62 Part 1 Organizing Projects 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 change to the project. In the spirit that one party cannot arbitrarily change a contract, the sponsor would not just tell the project team, I need the project a month sooner and you get no more resources and no relief from any other work responsibilities. Rather, if the project must change, the sponsor needs to consider herself or himself to be a partner with the project team in determining how to accomplish the change. 3-2 Why Is a Project Charter Used? The four major purposes for a charter are to: 1. Authorize the project manager to proceed 2. Help the project manager, sponsor, and team members, if any are already assigned, develop a common understanding 3. Help the project manager, sponsor, and team members commit to the spirit of the project 4. Quickly screen out obviously poor projects First, a project charter is a document that formally authorizes the existence of a project and provides the project manager with the authority to apply organizational resources to project activities. 1 Many project managers do not have the authority to commit resources without a charter. This gives the project and the project manager offi- cial status within the parent organization. Second, everyone involved in the upcoming project needs to develop a common understanding of what the project entails. This includes at least the broad justification for the project, how it aligns with the goals of the parent organization, determination of what is included and excluded in the project scope, rough schedule, success measures, major risks, rough estimate of resource needs, and stakeholders. On larger and more complex projects, additional understanding may be required at this point. Small, simple projects may use a simplified single-page charter. Once everyone has a common under- standing of clear project goals, several additional benefits occur: Teamwork develops. Agreement, trust, communication, collaboration, and commitment among the spon- sor, project manager, and project team develop. The project team does not worry if management will accept a decision and can focus on the project plan. The sponsor is less likely to unilaterally change the original agreement.2 Third, each person needs to personally and formally commit to doing their level best to achieve the agreed-upon project results even when things do not go as planned. It is a moral duty of all the project team members to commit to the shared goals articulated in the charter. This formal commitment often helps a person decide to keep working hard on a project when things are not going well. Fourth, a charter is used to quickly screen potential projects to determine which appear to be poor choices. Needless to say, a charter is much quicker to put together than a full, detailed project plan and schedule. If by constructing a charter it is determined that the project is likely to fail, much planning time (and therefore money) will be saved. Remember, the charter helps all project stakeholders. Charters are often publicly shown to many individuals beyond the project team and sponsor for communication. The culture of some companies is more trusting, competitive, focused on time, preoccu- pied with details, and so on than at other companies. Therefore, charters used in differ- ent industries and companies have somewhat different elements and formats. Chapter 3 Chartering Projects 63 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 3-3 When Is a Charter Needed? Project methods can be scaled from very simple to very detailed. Consequently, a project charter can vary in its length from one-page to multiple pages. A project manager wants to use details that are adequate enough to develop a common understanding and agree- ment between the project manager and the project sponsor. TriHealth has developed both full and mini charters, for large and small projects, respectively. They have also developed the decision matrix shown in Exhibit 3.2 to help people determine if a full charter, mini charter, or no charter is needed. EXHIBIT 3.2 PROJECT CHARTER DECISION MATRIX Project Name Date When an improvement, change, or new program is going to be implemented, it is important to first determine whether or not it is a project. If it is a project, TriHealth has specific tools that should be used to guide the planning and implementation. In general, a project is a temporary endeavor undertaken to create a unique product, service, or result. If your project impacts more than one department, requires expertise or resources beyond your own department, or could affect the operations in another area, the standardized templates should be used. Answering the questions below with a check will help you determine what types of tools are needed for your project. Evaluate where the majority of your checks lie and use the most appropriate tool. Resources Little or no monies, supplies, or change in resources Requires moderate resources Requires significant and/or additional FTEs Multidisciplinary 1 discipline involved/ impacted 2 3 disciplines involved/ impacted or more than one site More than 3 disciplines involved/impacted Complexity Little complexity Moderate complexity; affects care delivery Very complex Technology Involvement No technology changes IS consult needed IS resources assigned Approvals None needed Approval by immediate supervisor Executive-level approval Potential Risk Level Minimal impact on customer Moderate impact on customer Significant impact on customer Staff Commitment Involvement of 2 3 people for solution Small team needed to generate solutions Requires large team of multiple departments for improvement Communication and Education Simple communication plan or unit-based educa- tion only Moderate communication plan; requires education across departments Complex communication/ education plan with various media Metrics Requires at least a one-time follow-up check Improvement will be tracked Baseline and ongoing tracking of data If the majority of your checks lie in this area: No charter needed Complete a mini charter Complete a full project charter Source: TriHealth. 64 Part 1 Organizing Projects 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 3-4 Typical Elements in a Project Charter The following sections list some of the typical key elements in a project charter. While the intent of most of these sections is included in many charters, some project teams combine sections or leave out a few of them. Furthermore, while the term charter is a widely used stan- dard, some organizations use other names such as project request, project submission form, or project preplanning form. As long as the four purposes of a charter (authorization, understand- ing, commitment, and screening) are accomplished, the exact format and title are negotiable. Typical charter elements and the question each element answers are shown in Exhibit 3.3. The charter should be short enough so that the project team and sponsor (and any other interested stakeholder) can examine it carefully to ensure they understand and agree. One to four pages in total is generally about the right length. 3-4a Title The existence of a meaningful project title is critical. In an organization with a number of projects, the title can be used to quickly identify which project is being referenced. 3-4b Scope Overview The scope overview and business case sections are the high-level what and why of the project. They are sometimes considered to be the elevator speech that a person would use if given a very short amount of time, such as a one-floor elevator ride, to describe their project. Sometimes, an additional background statement is helpful. The scope overview is the project in a nutshell: a high-level description of what needs to be accomplished and how it will be done. What needs to be accomplished can be described as the product scope, all the characteristics that must be present in the actual project deliverables or as requirements, each of which is an attribute that needs to be present in order to satisfy a contract, client, or other stakeholder. How it will be done is the project scope, the entirety of what will and will not be done to meet the specified EXHIBIT 3.3 CHARTER ELEMENTS AND QUESTIONS ANSWERED CHARTER ELEMENT ANSWERS THE QUESTION Scope overview What? Business case Why? Background Why? Milestone schedule When? Success criteria What? Risks, assumptions, and constraints Whoa! Resources How much? Stakeholders Who? Team operating principles How? Lessons learned How? Signatures and commitment Who? Chapter 3 Chartering Projects 65 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 requirements. The scope overview quickly describes the project work and results. The scope overview is used to distinguish between what the project will and will not do. It is used to help prevent scope creep, which is an incremental increase in the work of a project without corresponding adjustments to resources, budget, or schedule. The scope overview can be considered to define project boundaries. It states what is included and what is not at least at a fairly high level. Quantifying the scope, such as 15 touch points will be included, helps everyone to better understand the project s size. If a project could be compared to an animal, the scope overview briefly describes both the size and features so one can tell if it is a rabbit or an elephant. By understanding what is included and what is not, the project team is more likely to accurately estimate cost, resource, and schedule needs and to understand and handle project risks. 3-4c Business Case The business case is the project purpose or justification statement. It answers the ques- tion why? and helps all parties understand the purpose of the project. A business case is used to justify the necessity of the project. It should clearly tie the project to the orga- nization s strategy and explain the benefits the organization hopes to achieve by autho- rizing the project or the strategic goals it meets. Depending on the organization, a business case can either be just the rationale for the project, or it can also include high-level estimates of the costs and benefits of the project. A business case may also include emotional and ethical reasons for performing the proj- ect. A well-written business case should persuade decision makers to support the project and inspire the project team members and key stakeholders to work hard toward suc- cessful completion of the project. 3-4d Background Many people are quite busy and prefer short statements that can be quickly reviewed. Key project stakeholders should know enough about the project after reviewing the short scope overview and business case statements, as these statements will provide all of the information they need to know. Some other stakeholders may need more details to understand the rationale and purpose behind these statements. A more detailed back- ground statement may be helpful in these cases. Unlike the first two statements, which should be limited to about two to four sen- tences each, the background statement can be any length. The background statement is purely optional develop one only when it is necessary. 3-4e Milestone Schedule with Acceptance Criteria The milestone schedule is a high-level plan that indicates a few significant accomplish- ments that are anticipated over the life of the project. It divides the project into a few (about three to eight) intermediate points or milestones whose completion can be veri- fied. The team estimates a date when they expect to complete each milestone. A mile- stone schedule should list major milestones and deliverables that the project team especially wants to ensure are completed both on time and to the satisfaction of key deci- sion makers. The milestone schedule is considered very useful for communicating with the key stakeholders who are not actively involved with the project. A deliverable as defined in Chapter 1 is a unique and verifiable product, result, or capabil- ity to perform a service that is required to be produced to complete a process, phase, or project. 3 Requirements of a deliverable are often translated into specifications so that the deliverable can be validated, qualified by measurable conditions, and bounded by constraints. Sometimes, milestones occur right before the approval of a large expenditure. At other times, they occur at completion of a critical design, a key deliverable, or a major 66 Part 1 Organizing Projects 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 AGILE accomplishment of the scope. It is helpful to identify the relatively few milestones and key deliverables in the project that the team and sponsor wish to check closely. Adding a column for acceptance criteria factors to the milestone schedule helps the project team understand who will judge the quality of the deliverable associated with each milestone and what criteria will be used for that determination. Acceptance criteria stipulate which conditions must be met in order for the deliverables to be approved. Acceptance criteria are like the project s vital signs. A paramedic would check pulse, breath- ing, maybe skin color, and body temperature immediately when answering a 911 call. Other tests are not as critical and may be performed, just not immediately. It is important to identify the vital signs for the project. Project success is easy to measure after the project is complete. The equally important, but often more challenging, decision is how to measure success while the project is progressing so there is still time to make changes if necessary. Another way to understand acceptance criteria is to understand how a key stakeholder such as the sponsor, customer, or end-user is going to determine if the deliverables created are of good enough quality to accept. Since some of the milestones are often preliminary (drafts, prototypes, concepts, outlines, etc.), it is helpful to have the same person who will judge the final project deliverables judge them at the intermediate milestones. By doing this, the decision maker is much less likely to state at the end of the project, No, that is not what I meant. Including advance understanding of criteria is similar to the old saying that a trial lawyer never asks a question without knowing how the witness will answer. An astute project manager never turns in a deliverable without knowing how it will be judged. An example of a milestone schedule is shown in Exhibit 3.4. One key concept in Agile projects is that something of value will be delivered at each iteration. Something of value for IT projects means working software. For other projects, it still refers to something the user can use not just documentation. An agreement is reached during iteration planning on the definition of done meaning exactly how each feature and function must perform. This is comparable to deliverables with accep- tance criteria for each milestone as just described. 3-4f Risks, Assumptions, and Constraints A risk is an uncertain situation that could negatively or positively affect the project if it occurs. Assumptions are suppositions made during project planning that are treated as correct or factual, though they have not been proven. Project teams frequently identify, document, and validate assumptions as part of their planning process. Assumptions EXHIBIT 3.4 MILESTONE SCHEDULE EXAMPLE MILESTONE DATE WHO JUDGES ACCEPTANCE 1. Existing facility 9-19-16 2. Site visit/audit 9-22-16 PM/Customer Site data verified 3. Design and approval 10-22-16 Customer Customer approval 4. Equipment deliverables 12-2-16 Engineering & Manufacturing B.O.M. check 5. Project execution 1-6-17 Installation & Customer Commissioned 6. System turnover 1-13-17 Customer System throughout of 35,000 cases per day Chapter 3 Chartering Projects 67 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 generally involve a degree of risk. A constraint is anything that limits the implementa- tion of a project. Taken together, assumptions and constraints are what could cause project problems. They are included with risks so that all of the key participants sponsor, project manager, and core team are aware in advance of what could prevent them from successfully completing the project. While it is unrealistic to believe that the team can think of every single thing that could go wrong, the more comprehensive this section is, the more likely the team is to uncover problems before they occur and while there is time to easily deal with them. If an assumption turns out to be false, it becomes a risk. A constraint that limits the amount of money, time, or resources needed to successfully complete a project is also a risk. Some organizations, especially for small projects, group all risks, assumptions, and constraints together, while others handle each as a separate char- ter section. The most important point is not how each is managed, but that each is managed. Project managers and teams should look at risks for three reasons. First, any negative risk that is a threat that may inhibit successful project completion (to the satisfaction of stakeholders, on time, and on budget) needs to be identified. And, if it is a major risk, a plan must be developed to overcome it. Second, a positive risk is an opportunity to com- plete the project better, faster, and/or at lower cost or to capitalize upon the project in additional ways, and a plan should be developed to capitalize upon it. Third, sometimes there is more risk to the organization if the project is not undertaken and this provides additional rationale for doing the project. For each major negative risk identified, an owner is assigned responsibility. Then one or more response plans are normally developed to either lessen the probability of the risk event from happening in the first place and/or to reduce the impact if the risk event should materialize. Sometimes, transferring the risk to a third party makes sense. The goal is not to eliminate all risk, but to reduce the risk to a level that decision makers deem acceptable. w av eb re ak m ed ia /S hu tte rs to ck .c om 68 Part 1 Organizing Projects 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 3-4g Resource Estimates Remember that executives consider projects to be investments. The scope overview and busi- ness case sections of the charter describe the return expected, while the resources section describes what will be invested. These sections collectively help decision makers determine if the project is worth approving. Resources include the workers, tools, equipment, and anything else needed in order to execute your project. Since executives consider projects to be invest- ments of resources, they will want a rough estimate. This can be an estimate of the amount of staff time, equipment, or materials that are in short supply, and/or the amount of money that is required. Since there is only very general understanding of the project at this point, any budget will also be approximate and should be stated as such by calling it a preliminary budget and including the level of confidence one has in the estimate; this is often expressed in per- centage terms (such as plus or minus 50 percent) regarding the accuracy of the estimate. On some internal projects, the pay for the associates who work on the project often comprises much of the expense. Frequently, however, at least a few expenses are incurred. It is helpful to identify which expenses the project manager can authorize and which the sponsor needs to control. 3-4h Stakeholder List Project success is partially dictated by identifying and prioritizing stakeholders, managing robust relationships with them, and making decisions that satisfy stakeholder objectives. Therefore, it is good practice to identify and prioritize stakeholders early in a project. 3-4i Team Operating Principles Team operating rules or principles are sometimes established to enhance team perfor- mance. The goal is to increase team effectiveness and ensure that all parties are aware of what is expected. Team operating principles that are especially useful are those that The key players of a project show their commitment to the project by signing the commitment section of the charter. Pr es sm as te r/S hu tte rs to ck .c om Chapter 3 Chartering Projects 69 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 deal with conducting meetings, making decisions, accomplishing work, and treating each other with respect. This concept is further elaborated on as a Team Charter in Chapter 5 because some organizations will choose to create a separate team charter instead of including team operating principles in their project charter. 3-4j Lessons Learned While every project is unique, a great deal can be learned from the successes and failures of previous projects and turned into practical advice. Lessons learned represent the knowledge acquired by the project team throughout the project planning and execution, including things that should be replicated and things that should be avoided on future projects. To ensure that lessons learned are used, a sponsor should only sign a charter authorizing the project to begin when at least one or two good, specific lessons from the successes and/or failures of recently completed projects are included. This essentially forces the new project manager and team to look at the organization s lessons learned repository to find applicable learnings. A lessons learned register is an accumulation of the knowledge gained during previous projects selection, planning, and executing that can be easily referenced to help with planning and executing future projects. These lessons could be stored in a dedicated database, on a shared drive, or in a less formal manner. The database should be intuitive to use, and it should be easy to retrieve relevant information. It is important for new project teams to learn together; otherwise, they risk repeating mistakes from previous projects. 3-4k Signatures and Commitment The commitment section of the charter lists who is involved and sometimes describes the extent to which each person can make decisions and/or the expected time commitment for each person. This is where the project sponsor, project manager, and perhaps core team members publicly and personally show their commitment to the project by signing the char- ter. By formally committing to the project, the key players are more likely to keep working hard during difficult periods and see the project through to a successful conclusion. 3-5 Constructing a Project Charter It is wonderful if the sponsor can work with the project manager and possibly core team members who have been preassigned to construct the charter. The sponsor, however, as a busy executive, often does not have time to be present for the entire chartering period. In those cases, it is very helpful if the sponsor can create the first draft however crude of the scope overview and business case. A sponsor s ability to tell the project manager and core team concisely what the project is and why it is important gets the team off to a good start. If the sponsor wants the team to consider any important constraints, assumptions, risks, or other factors, she can help the team by pointing that out up front. Sometimes, on an especially important project, the organization s leadership team may draft more than just the business case and scope overview statements. If the leadership team feels something is very important, they can save everyone time by just stating it up front. Like- wise, if the sponsor knows he or she will only approve a charter with one of the elements writ- ten a particular way, he or she should tell the team that up front. Otherwise, the project manager, possibly with the core team, most frequently writes much of the rough draft. 3-5a Scope Overview and Business Case Instructions When possible, the first draft of these two sections should be provided by the sponsor or the leadership team. One to four sentences for each is enough but it needs to be in 70 Part 1 Organizing Projects 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 writing. Many teams find that, because these are the what and why of the project, it is easier to work on them at the same time. Teams often brainstorm key ideas and then craft the parts on which they agree into smooth-flowing statements. If the sponsor pro- vides a first draft of these sections, the project manager and core team carefully dissect it to ensure they both understand and agree. The project manager and team frequently propose refinements on the original draft. Scope overview and business case examples are depicted in Exhibit 3.5. 3-5b Background Instructions The project manager and team decide whether this optional section is necessary for their project as they construct the scope overview and business case. If the scope overview and EXHIBIT 3.5 SCOPE OVERVIEW AND BUSINESS CASE EXAMPLES PHASE II MULTICENTER TRIAL SCOPE OVERVIEW This project will initiate a Phase II multicenter clinical trial at Cincinnati Children s Hospital Medical Center (CCHMC). The trial will be conducted at five medical centers in the United States to investigate the safety and efficacy of an investigational drug s abil- ity to improve cognitive functioning and quality of life in pediatric patients with Tuberous Sclerosis Complex. The project is a follow-up study of a Phase I clinical trial conducted at CCHMC. ONLINE TUITION REIMBURSEMENT PROJECT SCOPE OVERVIEW This project will design, develop, and implement an online tuition reimbursement system that will provide employees with a self- service tool to submit a request for tuition reimbursement payment. This project will incorporate a workflow process that will do the following: Move the request to the appropriate personnel for approval. Alert the employee of any additional items necessary for processing the request/ Upon approval, send the request to payroll for final processing. Notify the employee of payment processing. DEVELOPMENT OF A BIOLOGICAL RESEARCH SPECIMEN SHIPPING CENTER PROJECT BUSINESS CASE The purpose of this shipping center is to provide professional shipping services and supplies for CCHMC employees who are responsible for shipping biological specimens as part of research. This shipping center will improve compliance, streamline ship- ping processes, enhance research productivity, reduce time and money invested in employee training, and reduce potential liability for noncompliance. ESTABLISHING A SECOND PULMONARY FUNCTION TESTING (PTF) LAB PROJECT BUSINESS CASE An additional PTF lab will enhance patient access by: Decreasing wait times and Providing a convenient location close to primary care appointments. It will also improve patient outcomes by assisting in: Diagnosis, Accurate assessment, and Chronic management of pediatric lung disease. In addition, establishing a PFT lab will increase revenue by: Increasing availability of PTF and Increasing community referrals for PFT. Source: Cincinnati Children s Hospital Medical Center. Chapter 3 Chartering Projects 71 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 business case seem detailed enough for all important stakeholders, an extra background section may not be needed. If necessary, the team probably brainstorms ideas and then combines them into a single smooth statement. An example of a background statement for a project to start a new co-op business is shown in Exhibit 3.6. 3-5c Milestone Schedule with Acceptance Criteria Instructions The first step in the iterative process of developing a project schedule is to define major milestones. This section of the charter can be developed most effectively by focusing on why you are doing a project before diving into all of the details. A method of depicting all of this information so it is simple to understand is to set up a four-column table with Mile- stone, Completion Date, Stakeholder Judge, and Acceptance Criteria heading the columns. An example of a milestone schedule with acceptance criteria for a project converting to a centralized electronic record system for a major research hospital is shown in Exhibit 3.7. SIX STEPS IN CONSTRUCTING A MILESTONE SCHEDULE The most effective way to construct the milestone schedule with acceptance criteria is to use the six-step proce- dure described below. Identifying the end points first (Steps 1 and 2) helps project teams avoid the problem of sinking into too much detail too quickly. Note that dates are the final item to be identified. It is unethical for a project manager to agree to unrealistic dates. Even though the milestone schedule is not very detailed, it is the first time a team thinks through how the project will be performed and how long it will take at each point. This allows a bit of realism in the schedule. Step 1 The first task is to briefly describe (in three or four words) the current situa- tion that requires the project and place this description in the first row of the milestone column. The current state may be a shortened version of the business case. The starting point for many projects is either something that exists, but does not work as well as desired, or a desire exists for something completely new. However, the starting point for some projects is the ending point of a previous project. Keep the description very short, and it will form an effective starting place. In Exhibit 3.7, the problem was paper records that were not centralized. Step 2 Once the current state is agreed upon by the project manager and team, skip to the desired future state. Describe the project (or phase if there will be future phases) at its successful completion in three or four words. Put this description in the last row of the milestone column. It is hard for many core teams to distill this to the ideal three or four words, but keeping it concise helps the team develop a better understanding of what is EXHIBIT 3.6 BACKGROUND SECTION EXAMPLE Interfaith Business Builders is an organization of diverse Cincinnatians that develops and promotes community-based, employee-owned and -operated cooperative businesses (co-ops). Our co-ops cre- ate new jobs and ownership opportunities for low-income people in sustainable local businesses. Members of IBB come from a variety of faith and social backgrounds, share a passion for social jus- tice and the empowerment of people, and value community, cooperation, opportunity, and solidar- ity. Our cooperatives are businesses that follow these seven principles: voluntary and open membership; democratic member control; members economic participation; autonomy and inde- pendence; education, training, and information; cooperation among cooperatives; and concern for community. 72 Part 1 Organizing Projects 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 truly most important. If the current project is a phase of a larger project, also write briefly what the final successful result of the last future stage will be. In Exhibit 3.7, the desired future state is to have records centralized and available in electronic form, and the ultimate goal is for seamless information flow throughout the organization. More work will need to be completed beyond this project to reach that ultimate goal. Since contemporary project management is often iterative, many projects are part of a larger goal. Step 3 Next, describe the acceptance criteria for the final project deliverables (at the future state). What stakeholder(s) will judge the deliverables, and on what basis? Exactly how will they become confident that the project results will work as desired? These sta- keholders will almost always demand a demonstration of project results. The project team wants to understand what that demonstration will be at this early point so they can plan to achieve it. Note that there very well could be multiple stakeholders and mul- tiple methods of ensuring the project results are satisfactory. At this point, strive to iden- tify the most important stakeholders and acceptance criteria. Place these in the bottom row of the third and fourth columns. In Exhibit 3.7, the sponsor wants a representative from each department to show they can enter and retrieve pertinent data. Step 4 Now, go back to the milestone column. Determine the few key points where quality needs to be verified. On most small to medium-sized projects, approximately three to eight intermediate points are satisfactory. Start by identifying the three most important EXHIBIT 3.7 MILESTONE SCHEDULE WITH ACCEPTANCE CRITERIA EXAMPLE COMPLETION DATE MILESTONE STAKEHOLDER JUDGE ACCEPTANCE CRITERIA Current state: Paper, noncentralized records Needs assessment 28-Feb Ops management List of needed features Hardware selection 15-Apr Ops management, CIO Hardware choice with contract Vendor selection 30-May Ops management Vendor choice with contract Installation and configuration 15-Jul Application specialist, IS department head Functional software in test environment Conversion 31-Aug Application specialist, IS department head All files converted Testing 15-Oct Application specialist, IS department head Sign off on test Training 30-Nov Ops management, HR Sign off on training Future state: Electronic, centralized records 30-Nov Sponsor Ability to enter and retrieve information from all departments Ultimate goal Seamless information flow throughout organization Chapter 3 Chartering Projects 73 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 AGILE intermediate points, and add more if necessary. If you need to identify considerably more major deliverables at this point, you might consider splitting your project into phases and concentrate on the first phase for now. Satisfactory completion of each milestone will be determined by how the sponsor and other stakeholders will judge your performance. They should be in enough detail so stakeholders are comfortable with your progress, yet not so detailed that you feel micromanaged. The project in Exhibit 3.7 has seven milestones. On Agile projects, the first iteration is planned as a milestone with acceptance criteria just as described above. Rather than have a defined set of milestones, an agile charter after the first milestone is more of a general roadmap of the product. Subsequent mile- stones and acceptance criteria are determined on a just-in-time (JIT) basis. Step 5 Now, for each milestone, determine who the primary stakeholder(s) is and how he or she will judge the resulting deliverable. Remember, these are intermediate deliverables, and often it is not as easy to determine desired performance. One idea to keep in mind: if practical, ask the person who will judge the overall project results at the end to judge the intermediate deliverables also to make sure you are on the right track. Quite a few different stakeholders will judge various milestones in the project in Exhibit 3.7. Step 6 Finally, determine expected completion dates for each milestone. Do not be overly optimistic or pessimistic. You will be at approximately the right level of detail if you have a milestone somewhere between every one and six weeks on many projects. Obviously, there will be exceptions for especially large or small projects. Most of the milestones in the project in Exhibit 3.7 are about six weeks apart. Some companies that perform many projects use templates to guide their project teams through chartering and other activities. An example of a template for the mile- stone schedule and acceptance criteria for a Six Sigma project is shown in Exhibit 3.8. EXHIBIT 3.8 SIX SIGMA MILESTONE SCHEDULE AND ACCEPTANCE CRITERIA TEMPLATE Measure Analyze Improve Control Future State Current Situation Define Problem in operational terms Customers and metrics identified Project schedule and assignments Causal relationships defined Data gathering procedures approved Sufficient data gathered Potential variables identified; Root causes statistically proven Problem resolution ideas gathered Solution evaluated and confirmed Solution implemented Standards, procedures, training in place 74 Part 1 Organizing Projects 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 3-5d Risks, Assumptions, and Constraints Instructions First, the project manager (possibly with core team members, sponsor, and/or key stake- holders if available) should brainstorm all the things that could pose a risk to the project schedule, budget, usefulness of any project deliverables, or satisfaction of any project stakeholder. This is the process of risk identification. All of the risk processes will be covered in more detail in the risk planning chapter. Constraints that limit choices and unproven assumptions can be identified. Assumptions are especially important when a cross-functional team is performing the project because some team members may make vastly different assumptions based upon the manner in which work is normally accom- plished in their respective departments. The brainstorming often works very well with each team member writing one risk, constraint, or assumption per Post-it Note. On large, complicated projects, risks, assumptions, and constraints may form separate sec- tions of a charter. An assumptions log is often created as a living document to record all assumptions and the findings of whether they proved to be true or false. However, in this book, we deal with them together. From this point forward, all risks, assumptions, and constraints are simply referred to as risks. Either the project manager or one of the team members can then act as a facilitator and assess one risk at a time. Risks can be assessed on probability of occurring and impact if realized. Both dimensions can be shown with a simple continuum of low to high using a flip chart or marker board. The team can agree to assess each risk at any point on the continuum. It works best if one dimension is considered at a time. For example, first ask how likely the risk event is to occur. Only after this is answered, ask how big the impact will be if it happens. After all risks are assessed, the team needs to decide which of the risks should be con- sidered major risks. That is, which are important enough to require a formal response plan with someone assigned responsibility? The other, more minor risks are not formally considered further in the charter, but they very well may get more attention in the plan- ning and executing stages. This is the process of qualitative risk analysis. The project team constructs a table depicting each major risk, with its contingency plan and owner. This is the process of planning risk responses. Examples of risk assessment and major risk response planning for a hardware upgrade project in an Irish factory are shown in Exhibits 3.9 and 3.10, respectively. 3-5e Resources Needed Instructions Armed with the milestone schedule, the project manager and team may be prepared to make crude estimates of the project budget and other resource needs such as people, equipment, or space. It is imperative to describe how the estimates were developed and the level of confidence the team has in them, such as this is a rough order of magnitude estimate only based upon the milestones, and the true project cost could range from 25 percent below this to 75 percent above it. On many projects, especially those with cus- tomers internal to the organization, a budget is not established. However, a limit of spending authority for the project manager is often developed. An example of resources needed for a project is shown in Exhibit 3.11. 3-5f Stakeholder List Instructions Stakeholders are all the people who have an interest in a project. They can be internal or external to the organization, be for or against the project, and have an interest in the project process and/or the project results. The project manager and team begin by iden- tifying all stakeholders and determining which are most important. They next ask what Chapter 3 Chartering Projects 75 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 EXHIBIT 3.10 RISK RESPONSE PLANNING EXAMPLE RISK EVENT RISK OWNER RISK RESPONSE PLAN(S) Hardware inadequate Edie 1. Techs revise existing hardware 2. Replace hardware Associates do not have skills to perform key functions Padraig 1. Train existing associates 2. Hire additional people Key resource not available Ute 1. Identify external resources to fill need EXHIBIT 3.9 RISK ASSESSMENT EXAMPLE Minor risks below the line Major risks above the line Hardware inadequate Associates do not have the skills to perform key functions Key resource not available EXHIBIT 3.11 RESOURCES NEEDED ESTIMATE MONEY PEOPLE OTHER Marketing $10,000 Project Manager, 250 hours 1 Dedicated Conference Room Core Team Members, 500 hours AV and Communica- tions $5,000 Internal Consultant, 100 hours Miscellaneous $5,000 Data Analyst, 100 hours Focus Group Participants, 50 hours Total $20,000 Total 1,000 hours 1 Room 76 Part 1 Organizing Projects 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 interest each stakeholder has in the project. A stakeholder list example for a clinical research project is shown in Exhibit 3.12. This is the process of identifying stakeholders, and the resulting list is the start of a stakeholder register. Both will be described in more detail in the stakeholder chapter. 3-5g Team Operating Principles Instructions The project manager and team will decide what project team operating principles they will use. The operating principles establish how meetings will be conducted, how deci- sions will be made, how work will get done, and how everyone will treat each other with respect. Exhibit 3.13 is an example of team operating principles. 3-5h Lessons Learned Instructions Each project by definition is at least somewhat different from any other project. That said, there are many commonalities in how projects can be planned and managed. A project manager and team need to consider what has worked well and what has worked EXHIBIT 3.12 STAKEHOLDER LIST EXAMPLE STAKEHOLDER PRIORITY INTEREST IN PROJECT Institutional Review Board Key Unexpected problems, progress Food and Drug Administration Key Serious adverse events, progress Site Principal Investigators Key Protocol, safety reports, changes Pharmaceutical Company (Customer) Other Serious adverse events, progress Research Subjects (Patients) Other Purpose of study, risks and benefits, protocol EXHIBIT 3.13 TEAM OPERATING PRINCIPLES EXAMPLE 1. Team members will be prepared with minutes from previous meeting, agenda, and project updates. 2. Meetings will normally last for up to 90 minutes. 3. Team members will rotate the role of recorder. 4. Each team member will be responsible for setting his or her own deadline. 5. In the event that a team member cannot have his or her assignment complete by the expected date, he or she must notify the team leader prior to the due date. 6. The team leader will be responsible for drafting the minutes from the previous meeting and the agenda for the next meeting within 48 hours. 7. Decisions will be made by: Team leader on ____ issues. Consensus on ____ issues. Delegation on ____ issues. Chapter 3 Chartering Projects 77 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 poorly on previous projects when starting a new one. A sponsor is wise not to sign a project charter authorizing work until the project manager and team show they have learned lessons from recently completed projects. One easy way to accomplish this is to have each project report lessons learned at key reviews and at project completion and to have the lessons available to all in a lessons learned knowledge base. The project man- ager and team can then look at the lessons until they find at least a couple that can help them on their project. These lessons are included in the charter. The more specific the lessons, the more likely the team will find them useful. Exhibit 3.14 is an example of project lessons learned. 3-5i Signatures and Commitment Instructions The project sponsor, manager, and team members sign the charter to publicly acknowl- edge their commitment. Sometimes other key stakeholders also sign. An example of a charter signature section is shown in Exhibit 3.15. EXHIBIT 3.14 PROJECT LESSONS LEARNED EXAMPLE All parties are responsible for defining and following the project scope to avoid scope creep. All parties should share good and bad previous experiences. Aligning team roles to sponsor expectations is critical. Keep sponsor informed so sponsor stays committed. Identify any possible changes as soon as possible. Use weekly updates on project progress to avoid unpleasant schedule surprises. Review previous events for specific lessons. EXHIBIT 3.15 CHARTER SIGNATURE EXAMPLE Anne E., Sponsor Signature Date Signature Date Karen H., Project Leader Signature Date Jim B., Team Member Signature Date Charlie H., Team Member Signature Date Mitch N., Team Member Signature Date Katie S., Team Member 78 Part 1 Organizing Projects 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 3-6 Ratifying the Project Charter The project manager and team formally present the project charter to the sponsor for approval. In some organizations, the leadership team is also present for this meeting. The sponsor (and leadership team members, if present) ideally is supportive, but also ready to ask questions regarding any part of the charter. These questions are for both clarification and agreement. Once all questions are satisfactorily answered including any agreements regarding changes the sponsor, project manager, and core team all sign the project charter and feel bound by it. Project managers are generally held more accountable for performance than they have the responsibility to direct people to perform. Because of this, project managers must negotiate. Here, we discuss how they need to negotiate a project charter with their spon- sor. Later in the book, we discuss how they often need to negotiate with functional man- agers for the particular people they wish to have work on the project; with customers concerning schedule, budget, scope, and a myriad of details; and with sponsors, suppli- ers, SMEs, and core team members. Nobody loves a project as much as the project manager does. However, a project manager must remember that negotiations will be smoother if she realizes that everyone with whom she negotiates has their own set of issues and goals. Regardless of the negotiation size or complexity, the six-step process shown in Exhibit 3.16 can serve as a guide. The negotiation process is based on the project manager and the sponsor attempting in good faith to reach a solution that benefits both useful deliverables for the sponsor and a manageable process for the project manager. Step 1 involves advance fact finding to determine what is needed from the negotia- tion. This includes seeking to understand both what the sponsor is likely to want and how he or she may act during the negotiations. Step 2 is for the project manager to understand the bottom line. What is the mini- mum acceptable result? Just as when buying a car, a project manager needs to under- stand when to walk away. This can vary a great deal depending on how much power each party has. The sponsor is likely to have more power. However, project managers need to understand that if they have the power and take advantage of their negotiation partner, that partner may not work with them on a future project. Therefore, the goal is not to always drive the hardest bargain, but to drive a fair bargain. Step 3 is for the project manager to understand the underlying needs of the sponsor and to share his or her own needs. This is not a 10-second political sound bite that says take it or leave it. This is developing a real understanding of each other s needs. Once both parties understand what the other really needs, various creative solutions can be developed. This is the essence of Step 4. Step 5 consists of the process and strategies of the negotiation itself. It is helpful to keep in mind the ultimate goal while focusing on the many details of information sharing, trading of concessions, and exploring possible solutions. Step 6 is actually a reminder to reach an agreement and then to document that agreement. 3-7 Starting a Project Using Microsoft Project Microsoft (MS) Project is a software application designed to aid project managers in the planning, execution, and assessment of projects. It allows the project manager to track project tasks, set milestones, create corresponding schedules, and administer resources and budgets. Throughout the text (Exhibit 3.16), various MS Project processes will be demonstrated in a series of tutorials using the textbook s running Suburban Homes Chapter 3 Chartering Projects 79 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 Construction Project as a basis. A fully functioning demonstration version of MS Project 2016 is available for download from Microsoft. 3-7a MS Project 2016 Introduction MS Project 2016 is part of the Microsoft Office family; therefore, much of the basic interface and interaction with the software should seem familiar. You will find the unique aspects of the application in the project-specific tools and visuals the software provides the project manager. When you first open MS Project, you have the option to create a new (blank) plan, open a recently used or saved plan, or start a plan based on a template. The following overview showcases the visible features of the main MS Project interface once a blank project has been created. 1. Ribbon As with other Microsoft Office applications, the ribbon bar along the top of the interface contains the controls (or access to controls) used to develop and manipulate your project data. Controls are logically grouped in the following tabs: FILE includes familiar commands such as Open, Save, Print, and Options. TASK, RESOURCE, and PROJECT tabs allow task, resource, and project data entry and adjustment. REPORT offers a variety of customizable visual and print reports of project data. VIEW offers multiple ways to visualize your project data, including Calendar, Gantt Chart, Network Diagram, Resources, and Teams. A split (or combina- tion ) view is also available, providing two different types of data displays at once. FORMAT displays formatting controls that apply to the current active view. The For- mat tab header (above the tab) identifies the currently active view (e.g., Gantt Chart). 2. Quick Access Toolbar As with other Microsoft Office applications, this customizable area allows you to create shortcuts to regularly used commands. 3. Project Schedule Details View Pane(s) Below the ribbon is the project data view pane that displays information about the project. MS Project offers several different views, but the default setting is a split, dual display of the project Timeline and Gantt EXHIBIT 3.16 NEGOTIATION PROCESS STEP EXPLANATION 1. Prepare for negotiation. Know what you want and who you will negotiate with. 2. Know your walk-away point. Determine in advance the minimum you need from the negotiation. 3. Clarify both parties interests. Learn what the other party really wants and share your true interests to determine a common goal. 4. Consider multiple options. Brainstorm multiple approaches even approaches that solve only part of the issue. 5. Work toward a common goal. Keep the common goal in mind: seek and share information, make concessions, and search for possible settlements. 6. Clarify and confirm agreements. Agree on key points, summarize, and record all agreements. Source: Adapted from Aldag, Ramon J., and Loren W. Kuzuhara, Mastering Management Skills: A Manager s Toolkit (Mason, OH: Thomson South-Western, 2005): 129 132; and Baldwin, Timothy T., William H. Bommer, and Robert S. Rubin, Developing Management Skills: What Great Managers Know and Do (Boston: McGraw-Hill, 2008): 307 318. 80 Part 1 Organizing Projects 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 Chart views in an upper and lower pane. Although both are visible, only one view is active (indicated by a colored view name label on the far-left end of the view pane). The active view can be changed in the View tab or with the View Shortcut buttons. Timeline View: The Timeline View shows you the big picture of your project schedule. Milestones or other key activities can be marked and highlighted in the timeline to help better visualize the project. Gantt Chart View: The Gantt Chart is a commonly used tool to represent a proj- ect schedule. Once a list of project task details is inputted into the table on the left-hand side of the view, horizontal bars populate the right side to graphically represent each task against a calendar along the top of the view. 4. Zoom Slider The zoom slider is useful in any view that contains calendar data. It quickly changes the timescale by sliding left or right. 5. View Shortcuts View Shortcuts provides a quick switch from the active view to five different views: Gantt Chart, Task Usage, Team Planner, Resource Sheet, and Report. 6. Scheduling Mode selector Scheduling Mode reports the default scheduling mode (manual or automatic) for each new task. To change it, click Control and choose the desired setting from the list (a change only applies to the active schedule). See the next section for more on Scheduling Mode. 3-7b Setting up Your First Project There are two scheduling modes in MS Project 2016: Auto Scheduled and Manually Scheduled. Auto scheduling calculates the project s running schedule based on task start and finish dates, as well as other changes you might make in the future. Manually Sched- uled is the default setting, but we will change that immediately to take advantage of the EXHIBIT 3.17 CHAPTER CHAPTER TITLE MS PROJECT PROCESS 3 Chartering Projects Introduce MS Project 2016; Set up a project; Create a milestone schedule 7 Scope Planning Set up a work breakdown structure (WBS) 8 Scheduling Projects Set up schedule; Build logical network diagram; Understand the critical path; Display and print schedules 9 Resourcing Projects Define resources with calendars; Assign resources, including modifications; Find and resolve over-allocations 10 Budgeting Projects Develop project budget 12 Project Quality Planning and Project Kickoff Baseline the project plan 14 Determining Project Progress and Results Update and report on project schedule 15 Finishing Projects and Realizing Benefits Close projects Chapter 3 Chartering Projects 81 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 program s automatic scheduling powers. To change the scheduling mode, do the follow- ing (Exhibit 3.18): 7. With a blank, new project open, click File tab>>Options>>Schedule.
8. In the Scheduling options for this project section:
Change the dropdown to All New Projects
Change the New tasks created option to Auto Scheduled
9. Click OK.
Note: This action sets all future projects you may start in MS Project to Auto Sched-
uled. These options allow you to change this setting on a project-by-project basis, or you
can simply click the Scheduling Mode Selector shortcut on the left-hand side of the
bottom status bar and choose your desired scheduling method.
3-7c Define Your Project
Next, you need to define your project by entering the following information:
1. Set the project start date (Exhibit 3.19)
Click Project tab>>Project Information
In the dialog box, enter your project s start date (e.g., Mon 10/16/17)
Click OK; you ll notice Timeline View has updated with your start date!
2. Enter identifying information about the project (Exhibit 3.20).
Click File tab
EXHIBIT 3.18
SET AUTO SCHEDULE
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
82 Part 1 Organizing Projects
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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

On the right-hand side of the screen, click Project Information>>Advanced
Properties.
In the Summary tab, enter Suburban Park Homes in the Title box
Add other information as needed for future reports
Click OK
3. Generate a Project Summary task row (Exhibit 3.21)
Creating a Project Summary task row gives you another overview of the entire
project in the top row of the Gantt Chart view
Click File tab>>Options>>Advanced
On the Advanced page, scroll to the Display options for this project section
Click the checkbox for Show project summary task
Click OK; you ll notice a new summary row at the top of the Gantt Chart table!
3-7d Create a Milestone Schedule
You will now create a milestone schedule that will capture significant deliverable comple-
tion dates and be viewable in your Gantt Chart view.
Click the Gantt Chart view to make it active
Enter the milestone names from the Suburban Park Homes project in the Task
Name cells below the Project Summary row (You can find milestone information
from the project on page 91.)
In the Duration cells, use the up/down arrows to set each milestone s value to zero
EXHIBIT 3.19
SET PROJECT START DATE
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
Chapter 3 Chartering Projects 83
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

For each milestone row:
a. Double-click the milestone name to activate the Task Information dialog box
(Exhibit 3.22)
b. Click the Advanced tab; change the Constraint type to Must Finish On
c. In the Constraint date box, enter the milestone date
d. Click OK
Your milestone schedule in the Gantt Chart view should now look like the example in
Exhibit 3.23.
Now, we will add milestone markers to the summary row so the key project dates will
remain easily visible as the Gantt Chart task list expands.
Right-click the Suburban Park Homes summary task row>>Information
On the General tab, check the Hide Bar and Rollup boxes
Click OK (Exhibit 3.24)
Hold the Shift key and click your first task row>>click the last task row
Now all tasks should be selected
Right-click on the selected group>>Information
On the General tab, check the Rollup box until a checkmark appears
Click OK (Exhibit 3.25)
EXHIBIT 3.20
ENTER IDENTIFYING INFORMATION
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
84 Part 1 Organizing Projects
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

EXHIBIT 3.21
CREATE A SUMMARY ROW
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
EXHIBIT 3.22
TASK INFORMATION DIALOGUE
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
Chapter 3 Chartering Projects 85
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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

You will now see that the summary row bar has disappeared and been replaced with mile-
stone markers. We need to make them stand out a bit more and have the date (Exhibit 3.26).
Select the Suburban Park Homes summary task row
Click Format Tab>>Format>>Bar Styles
In the Bar Styles dialog box, click the Rolled Up Milestone style
In the Bars tab, change the Type to solid; change the color to blue (or your choice!)
Click the Text tab, click Right (or Left if you prefer!), choose Finish from the
drop-down
Click OK
EXHIBIT 3.23
SUBURBAN PARK HOMES MILESTONE SCHEDULE
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
EXHIBIT 3.24
SUMMARY TASK DIALOGUE
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
86 Part 1 Organizing Projects
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Your milestone schedule in the Gantt Chart view should now look like the example in
Exhibit 3.27.
EXHIBIT 3.25
MULTIPLE TASK INFORMATION DIALOGUE
EXHIBIT 3.26
BAR STYLES DIALOGUE
Chapter 3 Chartering Projects 87
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PMP/CAPM Study Ideas
Whether you are studying for the CAPM or PMP exam, you will likely see many questions
pertaining to the order in which processes occur and deliverables are produced throughout
the lifecycle of a project. In this chapter about the project charter, it is important to remem-
ber that the various subdeliverables and processes are all encompassed within the Initiating
phase. In fact, it is the ratification of the project charter that allows us to proceed from the
Initiating to the Planning phase.
In other words, even though the charter and its components represent a high-level project
plan, you should think of this as the preplanning because it is still in rough-draft form and
will be significantly expanded upon during the Planning phase. So, if you plan to sit for one of
these tests, make sure you know the logical order of the steps involved in creating a charter, but
also keep in mind that every single one of these precedes the more-detailed processes to come.
EXHIBIT 3.27
UPDATED SUBURBAN PARK HOMES MILESTONE SCHEDULE
Summary
The project charter is a vital document since it enables
the project sponsor and project manager to reach
mutual understanding and agreement on the project at
a high level. Often, core team members who have been
preassigned and sometimes a key stakeholder or two
sign also sign the charter. All parties can commit to
the intent of the charter with confidence. Charters typi-
cally include sections such as a scope overview, business
case, milestone schedule, acceptance criteria, risks, and
signatures. Many charters include additional sections.
The sponsor or leadership team might write the
rough draft of the business case and scope overview,
but the project manager and core team typically write
the rough draft of the majority of the charter. Once the
draft is written, the sponsor meets with the project
manager and core team to go over the charter in detail
both to ensure understanding and to reach agreement.
The charter, by signaling commitment on the part
of the team and authorization on the part of the spon-
sor, is the document that completes the project initiat-
ing stage. Once the charter is complete, the project
team can usually turn their attention to planning the
details of the project. The first detailed behavioral plan-
ning topics that deal with the project team, other sta-
keholders, communication, and leadership form the
next book module: Leading Projects. The other detailed
planning topics tend to be more technical and form the
third book module: Planning Projects.
Key Terms Consistent with PMI Standards and Guides
project charter, 63
requirements, 65
scope creep, 66
milestone schedule, 66
acceptance criteria, 67
risk, 68
88 Part 1 Organizing Projects
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assumptions, 68
constraint, 68
resources, 68
lessons learned, 70
assumptions log, 75
lessons learned register, 70
Chapter Review Questions
1. What is a charter?
2. Describe what an effective charter should
accomplish.
3. How is a charter like a contract? How is it different
from a contract?
4. How long should a typical charter be?
5. Signing the charter marks the transition between
which two project stages?
6. Who generally writes the rough draft of a
charter?
7. Give three reasons for using a charter.
8. What are some typical elements of a charter?
9. What is scope creep and how can it be prevented?
10. When would a background section be helpful?
11. On most small to medium-sized projects, how
many intermediate milestones should be identi-
fied in the charter?
12. What types of resources might be included in a
resources-needed section of a charter?
13. Name three reasons project managers and teams
should look at risk.
14. Why should each contingency plan have an
owner who is responsible for it?
15. What are the four columns of the milestone
schedule?
16. With whom might the project manager and project
team need to negotiate when creating the charter?
17. What is the primary difference between Auto and
Manually scheduled settings in Microsoft Project?
Discussion Questions
1. Identify the purpose of each element in a project
charter.
2. Explain how a charter helps secure both formal
and informal commitment.
3. How are risks, assumptions, and constraints related?
4. If you are a project manager and have the choice
of forming your core team before or after charter
approval, which would you do and why?
5. List and describe at least four lessons you have
learned from previous projects. Relate how each
is valuable in planning a new project.
6. In your opinion, what are the three most impor-
tant items in your project charter? How did each
help you initiate your project better?
7. Give an example of how an incorrect assumption
could become a risk.
8. Briefly summarize the process of creating a mile-
stone schedule.
9. How are project scope and product scope similar
and different?
10. Upon seeing the rough draft of your charter,
your project sponsor asks you to move the finish
date up by two months. What do you do?
11. What are the greatest advantages to using a com-
puterized scheduling program like Microsoft
Project?
PMBOK ® Guide Questions
1. Which of the following is not a purpose of an
approved project charter?
a. formally authorizes the existence of a project
b. provides detailed information about financial
resources
c. helps the team and sponsor develop a founda-
tional understanding of project requirements
d. provides project manager with authority to
apply organizational resources to the project
2. Adding to the project after it has already begun
without making adjustments to time, cost, or
resources, is known as:
a. scope creep
b. risk
c. milestones
d. acceptance criteria
3. It is inconvenient and time consuming for
employees to walk across campus every day to
Chapter 3 Chartering Projects 89
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eat lunch, which is why we need an employee
lunchroom in our building is an example of:
a. project scope
b. business case
c. milestone schedule
d. constraint
4. What information does the project charter con-
tain that signifies how the customer or user of the
final product, service, or result will judge the deli-
verables, in order to determine that they have
been completed satisfactorily?
a. high-level project risks
b. measurable objectives and acceptance criteria
c. high-level project boundaries
d. project assumptions
5. The project charter should include factors that
are considered to be true, real, or certain without
proof or demonstration. These are known
as .
a. risks
b. assumptions
c. high-level requirements
d. objectives
6. The signing of the project charter represents all
of these except:
a. a formal acknowledgment of the sponsor s
commitment to the project
b. the formal approval of the detailed project
schedule
c. authorization to transition from the high-level
project initiation stage into the more detailed
project planning stage
d. the organization s commitment to apply
resources to the project
7. What project charter component documents sig-
nificant points or events in the project and, per
the author, may be developed most effectively
when combined with other information such as
acceptance criteria?
a. network diagram
b. Gantt chart
c. stakeholder management strategy
d. summary milestone schedule
8. You are the project manager. Upon presenting
your charter to your sponsor, she requests several
changes. What do you do?
a. Agree to all the changes in order to make your
sponsor happy.
b. Refuse to change the charter, since that would
be unfair to your team.
c. Have your team vote on whether or not to
make the changes and go with the will of the
majority.
d. Negotiate with your sponsor to see how you
can best accommodate her requests without
agreeing to unreasonable expectations.
9. The charter is the primary deliverable of a pro-
ject s phase.
a. Selecting
b. Initiating
c. Planning
d. Executing
10. According to the PMBOK, the rough order of
magnitude for the summary budget within the
project charter is .
a. 100% to 200% accuracy
b. 25% to 75% accuracy
c. 5% to 10% accuracy
d. none of the above
11. After identifying potential project risks, the proj-
ect team should then .
a. develop risk response plans for all identified
risks.
b. wait for the sponsor to conduct a risk
assessment.
c. move on to other components of the charter,
since identifying risks is the only risk-related
activity in the initiating phase.
d. assess each risk based on probability and likely
impact, and then create a risk response plan
for each major risk.
Exercises
1. Consider a major team project for a class. Write
the scope overview and business case sections of
a charter.
2. Write the business case and scope overview sections
of a project charter for a project in which your com-
pany is considering buying out another company.
3. You are part of a student team that is going to
host a picnic-style party as a fundraiser event for
a deserving local nonprofit. Develop a milestone
schedule with acceptance criteria for this event.
Include between four and eight milestones.
90 Part 1 Organizing Projects
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4. You are part of a student team that has volun-
teered to host an alumni event at a recently reo-
pened museum in the downtown part of your
city. The event has the twin purposes of estab-
lishing contacts with long-lost alumni and raising
awareness of the newly reopened museum. Brain-
storm the potential risks for this, quantify them
both according to probability and impact, assign
responsibility for each major risk, and create one
or more contingency plans for each major risk.
5. You are part of a student team that is hosting a
number of inner-city junior high and high school
students from several nearby cities at your campus
for a weekend. The primary purpose is to encour-
age them to attend college and, second, to attend
your college. Identify as many stakeholders as pos-
sible for this project, prioritize them, and list the
interests each has in your project.
6. You have started a project working with your
peers at your rival college to create a cross-
town help-out. You want to encourage many
people in the community to contribute a day s
work on a Saturday for various community pro-
jects. You have a rather heated rivalry with this
other college. Create a comprehensive set of team
operating principles to use on this project. Which
of these principles is most important and why?
Do you expect any of them to be difficult to
enforce and why? What do you plan to do if
some of them do not work?
I N T E G R A T E D E X A M P L E P R O J E C T S
SUBURBAN HOMES CONSTRUCTION PROJECT
Scope Overview
Building a single-family, partially custom-designed home as
required by Mrs. and Mr. John Thomas on Strath Dr., Alpharetta,
Georgia. The single-family home will have the following features:
3,200 square-feet home with 4 bedrooms and 2.5
bathrooms
Flooring hard wood in the first floor, tiles in the kitchen
and bathrooms, carpet in bedrooms
Granite kitchen countertops, GE appliances in the kitchen
3-car garage and external landscaping
Ceiling 10 in first floor and vaulted 9 ceilings in
bedrooms
Business Case
Suburban Homes is in the business of constructing high-
quality homes at an affordable cost with luxury options to pro-
vide quality of life for families. The business strategy is to use
the best construction technologies and practices to enhance
productivity and increase profits, while offering cost-effective
and best-value homes for all its customers simultaneously.
The current project, Suburban Park Homes, is aimed to
expand business operations in Georgia.
Milestone Schedule and Deliverables
CM Construction Manager; PM Project Manager
Milestone Completion Date Stakeholder Judge Acceptance Criteria
Approval of final drawing and all the options 2nd January Client PM and the client to approve
Land preparation, landscape, and foundation 15th January CM PM and CM approval
External work completion and utilities hookup 3rd April CM PM and CM approval
Internal and external finish work and painting 10th May CM PM and CM approval
County clearance and Certificate of Occupancy 30th May CM County Inspectors and PM
Financial settlement and handover of home 21st June PM, Client Design Specifications approval
by PM and the client
Chapter 3 Chartering Projects 91
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Risks
Project Risks Risk Owner Contingency Plans
County approval
and permissions
Suburban Homes,
PM
None
County Property
Taxes hike
Client, Suburban
Homes
Document as con-
tract clause
Traffic congestion Client, County,
DMV
None
Resources Required
Funding: the client, underwriters, and Suburban Homes
People: Suburban project management team, contractors,
subcontractors, and skilled labor
Equipment: construction equipment, tools, and machinery
Material: building materials, appliances, landscaping, shrubs,
and trees
Stakeholders
Stakeholders Interest in Project
Primary:
The client
Suburban Homes
County Officers
Overall project cost, time, quality
Overall project cost, time, quality,
success criteria
Adherence to the county standards
Others:
Contractors
Suppliers
Utility companies
Timely payment of invoices
Business expansion, profits
Adherence to laws, business
expansion
Team Operating Principles
Commitment to project schedule: Project team and contrac-
tors will complete their assigned work as per schedule.
Progress Meetings: Construction team meetings sched-
uled on Mondays at 8 a.m. every week and as demanded
by work progress. Members should prepare for these
meetings with information required for review.
Communication: Regular updates of status, reporting
issues, and weekly progress reports.
Lessons Learned
Team participation in developing project schedule is critical.
Transparent communication is encouraged for resolving
issues.
Conflicts must be reported to the construction manager
immediately.
County laws and utility standards must not be
compromised.
Commitment
Sponsor Department/Organization Signature
Project Manager Department/Organization Signature
Core Team Members Department/Organization Signature
92 Part 1 Organizing Projects
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Semester Project Instructions
Determine one member of your student project team to
be the primary contact with the project sponsor (the
manager or executive who came to class when projects
were announced). The sponsor is also the customer
representative. This sponsor was encouraged by your
professor to come with a draft of the business case
and scope overview sections of the charter, but some
sponsors probably did a better job than others. You
need to ensure that you understand these statements
and how they fit with the organization s goals.
Then, your student team needs to draft the remain-
der of the charter with as much help as you can get from
the sponsor and/or other people at the organization.
Once the charter is in rough-draft form, submit it for
comments to your professor. Armed with the professor s
suggestions, you can present it to your sponsor and any
other people your sponsor chooses. Often, this may
involve a leadership team, department heads (functional
managers), and/or project team members. One differ-
ence on this project is that your student team will likely
do most of the planning and only part of the execution,
while members of the organization for whom you are
planning the project will need to complete the execution.
Therefore, you need to consider how you will transition
responsibility over to the parent organization near the
end of the class.
CASA DE PAZ DEVELOPMENT PROJECT
Questions for Students to Answer:
1. Given the information provided in Chapter 2 on how
this project was selected, create scope overview and
business case sections for a charter.
2. If you were the project manager, what expertise would
you like from the sponsor, stakeholders, or core team
members to create a milestone schedule with accep-
tance criteria?
3. Work with at least two other people and brainstorm
pertinent risks. Assess them to determine which you
believe are major risks, and develop at least one
response for each major risk.
4. Who are the key stakeholders for this project and what
is the interest of each? Which stakeholders have the
most power?
PROJECT MANAGEMENT IN ACTION
Information Systems Enhancement Project Charter
The following charter was used when a nonprofit
agency formed a project team to upgrade its informa-
tion systems. Comments on the left side give advice
from a communications perspective regarding how to
write a project charter, and comments on the right side
offer suggestions regarding the content of each section.
Chapter 3 Chartering Projects 93
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DESIGN PRINCIPLES
Headings:
Headings facilitate scanning
by identifying information
covered in each section.
Heading descriptions
should accurately indicate
the information that
follows.
Lists:
Listing techniques help
readers remember key
details of a message.
Numbers, bullets, and other
ordering devices promote
retention and improve
visual design.
Lists are best limited to five
points so they do not look
overwhelming to readers.
Lists are written in parallel
structure, with the first word
of each item having the
same grammatical form,
such as all nouns, all
verbs, or all -ing words.
CONTENT PRINCIPLES
Scope Overview:
The scope overview defines
the major deliverables. It
sets project boundaries by
clarifying what is included
and, sometimes, what is not
included.
Business Case:
The business case defines
project objectives and why
they are important to the
parent organization.
Milestone Schedule:
The milestone schedule
shows the project starting
point, a few major mile-
stones, and the ending point.
Acceptance Criteria
Factors:
These identify which
stakeholder will judge
the acceptability of each
milestone and what
criteria they will use.
PROJECT CHARTER: INFORMATION
SYSTEMS ENHANCEMENT PLAN
Scope Overview
This team will implement a new information
system based on a needs assessment of person-
nel of the agency. The project team will detail
technological issues, as well as upward, down-
ward, and lateral communications issues within
each department and recommend software pack-
age options for each program area. The sponsor
will select a vendor, and the project team will
oversee implementation.
Business Case Objective
The agency needs to overhaul its information
systems to increase productivity for staff, and
create additional learning opportunities for clients.
It is estimated that 20 percent more clients will be
served with the new system.
MILESTONE
COM-
PLETION
DATE
STAKE-
HOLD-
ER
JUDGE
ACCEP-
TANCE
CRITERIA
Outdated
facility, poor
productivity
Start
1/6/18
Staff survey 1/31/18 Sponsor Discussion
with depart-
ment heads
Software
recomm-
endations
3/14/18 Opera-
tions
Manager
All areas
included,
pilot results
Vendor
selected
3/28/18 Sponsor Best meets
qualifications
Technology
in place
5/9/18 Project
Manager
System test
demonstration
Updated
facility,
productivity
improved
5/30/18 Sponsor Two-week
data reports
from
department
heads
94 Part 1 Organizing Projects
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DESIGN PRINCIPLES
Tables:
Use tables to organize
complex information into
an easy-to-follow column
and row format.
Design tables so they
make sense when read
independently of the text.
Use table headings that
reflect logical groupings
of information.
Phrase column language
so it is in parallel structure.
Character Formatting:
Use character formatting,
including boldface, italics,
underlines, and centering
to highlight headings.
Use character formatting
hierarchically. Boldface,
underlines, and all caps
are best for major headings.
Use fewer or less dramatic
techniques for subheadings.
Type Size and Face:
Use 10-, 11-, or 12-point type
for most documents. People
who have poor vision often
prefer larger type.
Use a conventional
typeface, such as Arial,
Times Roman, or Palatino.
White Space:
Use white space to separate
document sections
attractively and to improve
readability.
Page Breaks:
When possible, complete
entire sections on the same
page. Redesign documents
where one or two lines of
text from a section run onto
the next page.
Major Risks
Resources Needed
This project will require the project manager
to spend 50% of her time and the lead user
and 3 core team members 25% of their time
for 5 months. The budget estimate is $45,000.
Stakeholder List
CONTENT PRINCIPLES
Project Risks and
Assumptions:
This section identifies major
risks and how the team
will either reduce their
probability of happening
and/or their impact if they
do occur. One person is
assigned responsibility
for each risk.
Resources Needed:
This is an estimate of the
money, personnel, and
other resources expected
to be needed.
Stakeholder List:
Identifies those individuals
and groups who have an
interest in either the project
process and/or results.
RISK
RISK
OWNER RESPONSE PLANS
System may
not work
properly
Technical
lead
Define top defect and
focus on it exclusively
until fixed.
Implementa-
tion may
cost too much
Accountant Identify areas of cost
reduction and added
funding.
Lack of
sponsor
buy-in
Project
Manager
1. Conduct staff survey
to identify most-
needed capabilities.
2. Understand sponsor
requirements.
STAKEHOLDER INTEREST IN PROJECT
Board
Sponsor
Department
Heads
Overall cost and overall project
success Overall project success,
resource needs; Impact on their
department, resource needs
Lead user New work methods, productivity
increases
Chapter 3 Chartering Projects 95
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References
A Guide to the Project Management Body of Knowledge
(PMBOK® Guide), 6th ed. (Newtown Square, PA:
Project Management Institute, Inc., 2017).
Altwies, Diane, and Frank Reynolds, Achieve CAPM
Exam Success: A Concise Study Guide and Desk Ref-
erence (Ft. Lauderdale, FL: J. Ross Publishing, 2010).
Assudani, Rashmi, and Timothy J. Kloppenborg,
Managing Stakeholders for Project Management
Success: An Emergent Model of Stakeholders,
Journal of General Management 35 (3) (Spring
2010): 67 80.
Evans, James R., and William M. Lindsay, The Man-
agement and Control of Quality, 8th ed. (Mason,
OH: Cengage, 2011).
Johnson, Craig E., Meeting the Ethical Challenges of
Leadership (Los Angeles: Sage, 2009).
CONTENT PRINCIPLES
Operating Principles:
Operating principles
indicate agreement on
deadlines, meetings,
decision making, and how
participants will treat each
other with respect.
Lessons Learned:
This section highlights
specific learnings from
previous similar projects
that will help the team copy
good practices and avoid
problems.
Commitment:
Project principals signal
agreement in principle to
the project, recognizing that
some of the specifics will
probably change when the
detailed planning is
complete.
DESIGN PRINCIPLES
Sentences:
To express complex ideas
effectively and to make
ideas easy for readers to
understand, compose most
sentences to be 15 25
words long.
Simple Language:
So all readers understand
your language easily,
substitute short, action-
oriented, easily understood
words for long, unfamiliar,
and unpronounceable
words.
Team Operating Principles
Commitment to timetable. The project manage-
ment team members will complete their
assigned work on time.
Regularly scheduled project team and sponsor-
ship meetings. Project team meetings will be
held every Saturday at 4:15 p.m. The team will
also communicate via e-mail as required. Spon-
sorship meetings with the agency staff will be
held bimonthly and as-needed.
Timely communication. The project manage-
ment team will communicate status, issues, and
questions with agency via e-mail or conference
call weekly. Project actions will be distributed to
the team every Monday.
Majority rule. The project management team will
negotiate and resolve issues on a majority-rule
basis.
Lessons Learned
Agreeing on project scope is a key preliminary
project planning activity.
Maintaining project goals and timeline requires
open communication and quick issue resolution.
Understanding roles and responsibilities facil-
itates smooth teamwork and timely project
completion.
Commitment
Sponsor Project Manager
Lead User Core Team Member
Core Team Member Core Team Member
96 Part 1 Organizing Projects
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Kloppenborg, Timothy J., and Laurence J. Laning,
Strategic Leadership of Portfolio and Project Man-
agement (New York: Business Expert Press, 2012).
Kloppenborg, Timothy J., and Joseph A. Petrick,
Managing Project Quality (Vienna, VA: Manage-
ment Concepts, Inc., 2002).
PMI Lexicon of Project Management Terms Version 3.0
(Newtown Square, PA: Project Management Insti-
tute, Inc., 2015).
Skilton, Paul F., and Kevin J. Dooley, The Effects of
Repeat Collaboration on Creative Abrasion, Acad-
emy of Management Review 35 (1) (2010): 118 134.
Endnotes
1. PMI Lexicon of Project Management Terms
Version 3.0, 2015: 13.
2. Kloppenborg, Timothy J., and Joseph A. Petrick,
Managing Project Quality (Vienna, VA: Manage-
ment Concepts, Inc., 2002): 39.
3. PMI Lexicon of Project Management Terms Ver-
sion 3.0 (Newtown Square, PA, 2015): 7.
Chapter 3 Chartering Projects 97
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2
ORGANIZE LEAD PERFORMPLAN
P A R T 2
LEADING PROJECTS
Chapter 4
Organizational Capability:
Structure, Culture, and Roles
Chapter 5
Leading and Managing
Project Teams
Chapter 6
Stakeholder Analysis and
Communication Planning
Leading for success in project management includes
leading the parent organization that is conducting the
project, leading the project team, and leading the various
stakeholders who care about the project in one way or
another. Chapter 4 deals with the parent organization
giving ideas about how the organizational structure,
organizational culture, project life cycle model, and roles
of various players impact a project. Chapter 5 includes
acquiring, developing, and leading the project team.
Chapter 6 includes engaging stakeholders, managing
communications, and running project meetings.
99
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C H A P T E R 4
Organizational Capability: Structure,
Culture, and Roles
We implement project management best practices for the purpose of increasing
the likelihood for project success. Formerly, as an executive, I was responsible
for establishing, operating, and evolving a national project management office
(PMO) for one of the nation s largest print/mail and electronic outsourcing firms.
Organizational structure, culture, roles and responsibilities of project partici-
pants, and project life cycle standard processes and tools were critical influen-
cers to achieving project success. As there is no single way to implement project
management, how we chose to address each influencer shaped the way projects
were managed. A snapshot of our approach follows:
From an operations perspective, there was a strategic need to implement a
centralized approach to project management. Through a number of mergers and
acquisitions, 10 geographically dispersed operation centers were servicing a
broad range of expanding customer needs. As a result, two key factors were at
play. One: the customer base was growing from regionally based to nationally
based customers. Two: the best-of-the-best operations technology needed to be
leveraged across all centers. Structurally, the decision was made to consolidate
CHAPTER OBJECTIVES
After completing this
chapter, you should
be able to:
CORE OBJECTIVES:
Compare and contrast the
advantages and disad-
vantages of the functional,
project, strong matrix,
balanced matrix, and
weak matrix methods of
organization; describe
how each operates and
when to use each.
Relate how an organiza-
tion s structure influ-
ences the implementa-
tion of its strategic plan.
Describe organizational
culture elements that are
helpful in planning and
managing projects and
demonstrate how to
overcome organizational
culture elements that
hinder project success.
Describe different proj-
ect life cycle models and
distinguish when each is
appropriate.
BEHAVIORAL OBJECTIVES:
Describe the duties,
motivations, and chal-
lenges of each of the
executive, managerial,
and team roles in projects
and list important attri-
butes for selecting each.
Given a project situation,
explain ethical behavior
consistent with PMI s
Code of Ethics and
Professional Conduct.
Predict the impact of orga-
nizational structure and
associated culture on indi-
vidual and team behaviors.
Predict the impact of
organizational structure
and associated culture
on individual and team
performance.
M
on
ke
y
Bu
si
ne
ss
Im
ag
es
/S
hu
tte
rs
to
ck
.c
om
100
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operation centers to three, geographically in the East, Central, and West. This
meant that internal and external projects that applied nationally could no longer
be managed at a regional level using only regional resources. A new type of proj-
ect manager was needed to manage national resources using a standardized set
of practices. Creating a matrixed project organization to serve the functional orga-
nization was the first phase.
PMBOK ® 6E PRIMARY OUTPUTS
1.2 Foundational elements Life Cycle and Development Approach
2.4 Organizational systems
3.4 Project manager competencies Leader Roles and Responsibilities
4.2 Develop Project
Management Plan
4.7 Close Project
or Phase
4.1 Develop
Project Charter
4.3 Direct and Manage
Project Work
4.4 Direct and Manage
Project Work
4.6 Perform Integrated
Change Control
4.5 Monitor and
Control Project Work
PMBOK® GUIDE
Topics:
1.2 Foundational
elements
2.4 Organizational
systems
3.3 The project man-
ager s sphere of
influence
3.4 Project manager
competencies
4.1 Develop project
charter
4.2 Develop project
management plan
4.3 Direct and manage
project work
4.4 Manage project
knowledge
4.5 Monitor and control
project work
4.6 Perform integrated
change control
4.7 Close project or
phase
CHAPTER OUTPUTS
Life Cycle and Devel-
opment Approach
Leader Roles and
Responsibilities
M
on
ke
y
Bu
si
ne
ss
Im
ag
es
/S
hu
tte
rs
to
ck
.c
om
101
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Ensuring the culture would accept and support these changes was critical
to success as change is not easy and resistance was anticipated. Senior manage-
ment buy-in was essential and plans were implemented to dialogue, collaborate,
and communicate the benefits of a PMO throughout the organization. The PMO s
first mission was to establish national project management standards and manage
a select few strategic national projects with a limited set of project managers.
Proof of concept was key to continued buy-in. Clear roles and responsibilities for
executive sponsors, project managers, and project team members were collabora-
tively established. Standard processes and tools used by the project teams were
jointly developed. Training occurred from the executive suite to project managers
and project team members. As time progressed, project success rates increased
and the PMO responsibilities were expanded to include the project management
of all strategic operational projects and new customer implementations. Career
paths for regional project managers were established. Selected regional project
managers were promoted and trained to be national project managers. The organi-
zational structure changed with selected regional project managers reporting to the
national PMO. The executive sponsorship roles continued to evolve along with
standard processes and practices to facilitate new responsibilities. In Improving
Executive Sponsorship of Projects: A Holistic Approach, additional insight on each
influencer, considerations, pitfalls, and tips for project management implementa-
tion approaches can be found.1
Dawne E. Chandler, PhD, PMP
C hapter 2 dealt with organizational issues of strategic planning, selecting, and resour-cing projects. Chapter 3 details how to initiate a project usually by composing and
ratifying a charter. This chapter introduces both project leadership and project planning.
Leadership in this chapter includes organizational structure and culture along with roles
of all key project participants. Planning is introduced in the selection of the project life
cycle approach and introduction to the concept of a project plan. Both project leadership
and planning lead to project success, as shown in Exhibit 4.1. Effectively leading project
team members and other stakeholders leads to a foundation of respect and trust, which,
in turn leads to project success. Effective project planning lays the groundwork for effective
project execution, monitoring, control, and closeout, which also lead to project success.
EXHIBIT 4.1
DETERMINANTS OF PROJECT SUCCESS
102 Part 2 Leading Projects
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4-1 Types of Organizational Structures
Contemporary companies choose among various methods for establishing their organi-
zational structure. Organization structure is often developed by grouping people together
based on criteria such as functional or technical skills or long-term activities. The struc-
ture size and complexity increase with the increase in the number of employees. The
structure is the way in which an organization divides its people into distinct tasks to
achieve coordination among all these groups. Organizational structure can be considered
to include work assignments, reporting relationships, and decision-making responsibility.
Each method of structuring organizations has strengths and weaknesses. In this section,
we will investigate various organizational methods and the impact of each on managing
projects. The advantages and disadvantages of each organizational form are discussed in
the following sections and then summarized in Exhibit 4.5.
4-1a Functional
A functional organization is an organizational structure in which staff is grouped by
areas of specialization and the project manager has limited authority to assign work
and apply resources. 2 This is the traditional approach in which there are clear lines of
authority according to type of work. For example, all accountants might report to a head
of accounting, all marketers report to a head of marketing, and so on. An organizational
chart for a functional organization is shown in Exhibit 4.2. Note that everyone in the
organization reports up through one and only one supervisor. That supervisor is the
head of a discipline or function (such as marketing).
The functional manager generally controls the project budget, makes most project
decisions, and is the primary person who coordinates project communications outside
the functional areas by contacting his or her peer functional managers.
ADVANTAGES One advantage of the functional form of organization is called unity of
command all workers understand clearly what they need to do because only one boss is
EXHIBIT 4.2
FUNCTIONAL ORGANIZATION
Marketing VP Operations VP Finance VP Services VP
Chapter 4 Organizational Capability: Structure, Culture, and Roles 103
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giving them instructions. Communication is vertical and clearly established. Another
advantage is that since all workers in a discipline report to the same supervisor, they will
have an opportunity to interact frequently and can learn readily from each other and keep
their technical skills sharp. Having the same supervisor also acts as a motivating factor for
several employees to maintain and improve their technical expertise. A third advantage is
that workers know that when they finish work on a project, they will still have a job
because they will continue to report to the same functional manager. For small projects
that require most of the work from one department, the functional organization often
works well, both because of the advantages already stated and because the functional man-
ager can share resources among various small projects and centrally control the work.
DISADVANTAGES That said, the functional form of organization can slow down com-
munications when multiple functions need to have input. It also can be challenging from a
technical standpoint if input is required from multiple disciplines. The functional manager is
probably quite good within his or her domain, but may have less understanding of other dis-
ciplines. However, in small organizations where most people have been forced to understand
multiple areas, this may be less of an issue. Coordination between departments is frequently
conducted at the manager level as the functional managers have a great deal of decision-
making authority. This often means communication needs to first travel up from an
employee at a low level in the structure to the manager, then across from one functional
manager to another manager, and then down from the manager to an employee at a low
level who will be working on it. This can become more complex when organizations have
multiple levels of hierarchy within functional divisions and a chain of command must be fol-
lowed. In short, coordination in a functional organization is complex and time consuming.
These long communication channels often make for slow decision making and slow response
to change. Integration becomes difficult and it may lead to frustration and a decrease in moti-
vation and innovation. Also, decisions will tend to favor the strongest functional group or
division. For these reasons, some organizations choose other forms of organization.
4-1b Projectized
The exact opposite form of functional organization is the projectized organization, which
is defined as group employees, collocated or not, by activities on a particular project. The
project manager in a projectized structure may have complete, or very close to complete,
power over the project team. 3 In this organizational form, the larger organization is bro-
ken down into self-contained units that support large projects, geographies, or customers.
Most people in the organization are assigned to a project and report upward through the
project manager, as can be seen in Exhibit 4.3. While the structure of the two organiza-
tional charts appears similar, the reporting manager is a project manager instead of a func-
tional manager. The project manager has extensive authority for budgets, personnel, and
other decision-making issues in this organizational structure. This provides adequate time
for the project manager to make decisions. Projectized organization structure provides an
opportunity to maintain expertise on a given project.
ADVANTAGES The advantages of the projectized organizational form are very differ-
ent from the advantages of the functional form. Because people from different functions
now report to the same project manager, traditional department barriers are reduced.
Since the project manager is responsible for communications, response times and deci-
sion making tend to be swift. All workers understand clearly what they need to do
because only one boss the project manager is giving them instructions.
Projectized organizational structures often utilize the technique of co-location, which
is an organizational technique in which the project team members are moved to
104 Part 2 Leading Projects
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alternate locations (either full time or only for parts of days) to allow them to better
work with one another, and on the project in general. 4 This co-location often results
in enhanced project team identity as well as trust, collaboration, coordination, strong
customer focus, and effective integration of effort on the project.
DISADVANTAGES However, this organizational form also has disadvantages. Team
members are often assigned to just one project, even if the project only needs part of their
time, which leads to idle time. This can be costly because project team members are retained
during and even after completing the project. Since the project manager is in charge and the
team may be physically located on-site rather than with the rest of the organization, some
projects tend to develop their own work methods and disregard those of the parent organi-
zation. While some of the new methods may be quite useful, project teams not watched
closely can fail to practice important organizational cultural norms, or accepted practices,
and they sometimes fail to pass the lessons they learn on to other project teams. Team
members who are co-located, while learning more about the broader project issues, often
do not keep up their discipline-specific competence as well. Team members sometimes
worry about what they will do when the project is completed, which leads to adverse motiva-
tional, morale, and security issues. In short, motivating people could become a challenge.
4-1c Matrix
Each of the extreme strategies already described (extreme in the sense that either the
functional manager or the project manager has a great deal of authority) has strong
advantages, but also significant weaknesses. In an attempt to capture many of the advan-
tages of both, and to hopefully not have too many of the weaknesses of either, many
organizations use an intermediate organizational strategy in which both the project man-
ager and the functional manager have some authority and share other authority.
This intermediate strategy is the matrix organization, which is any organization in
which the project manager or project team leader actually shares responsibility for the
project with a number of individual functional managers. 5 A matrix organization is
shown in Exhibit 4.4. Note that project team members report to both functional and
EXHIBIT 4.3
PROJECTIZED ORGANIZATION
Project Manager 1 Project Manager 2 Project Manager 3 Project Manager 4
Chapter 4 Organizational Capability: Structure, Culture, and Roles 105
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project managers. This is a clear violation of the unity-of-command principle; however,
it is necessary to enjoy the benefits of a matrix organization. In short, the hoped-for ben-
efit of a matrix structure is a combination of the task focus of the projectized organiza-
tional structure with the technical capability of the functional structure.
ADVANTAGES Matrix organizations have many advantages, which is why an increas-
ing number of companies are using some variation of them today. One advantage is that
because both project and functional managers are involved, there is good visibility into
who is working where, and resources can be shared between departments and projects.
This reduces possible duplication a major advantage in this age of lean thinking in busi-
ness. Since both types of managers are involved, cooperation between departments can be
quite good. There is more input, so decisions tend to be high quality and are better
accepted. This is a major issue since enthusiastic support for controversial decisions often
helps a project team work through challenges. Since people still report to their functional
manager, they are able to develop and retain discipline-specific knowledge. Since the vari-
ous disciplines report to the same project manager, effective integration is still possible.
Because people report to both the project manager, who is responsible for capturing les-
sons learned, and to the functional manager, who is responsible for how the work in a
function is performed, lessons learned can be shared effectively between projects. Further-
more, policies and procedures for each project can be set separately. The project manager
can commit resources and respond to changes, conflicts, and project needs quickly.
Yet another advantage of the matrix form is its flexibility. The amount of decision-
making authority can be shared in whatever manner is desired. When the functional
managers have relatively more power, it is almost like a functional organization. This is
the way many organizations start evolving by giving project managers a bit more
decision-making authority. This is called a weak matrix since the project managers have
less authority than the functional managers. The next step in the progression is a bal-
anced matrix in which project managers and functional managers have about equal
EXHIBIT 4.4
MATRIX ORGANIZATION
Marketing VP Operations VP Finance VP Services VPManager of
Project Managers
Project Manager 1
Project Manager 2
Project Manager 3
Project Manager 4
106 Part 2 Leading Projects
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power. Finally, a strong matrix is one where the project managers have more power than
functional managers. This is more similar to a projectized organizational form. The pro-
gression of forms is shown in Exhibit 4.5.
DISADVANTAGES The matrix organizational form has drawbacks as well. Some people
claim that having two bosses (both a functional manager and a project manager) is a disad-
vantage. This problem certainly needs to be managed because the two managers may each
try to do what they think is best for their project or department and may give conflicting
advice. Dual responsibility and accountability can be demotivating for some people. How-
ever, this is common territory for most people. Most students take multiple classes per
term. Most companies have multiple customers. Having to balance competing demands
can be difficult, but it is often the norm. Since more people are providing the necessary
input, there are more sources of conflict, more meetings, and more challenges to control.
Decisions may not get made as fast. Also, priorities are likely to change routinely.
Firms need to consider which organizational structure is best for them so they can
capitalize on its advantages and mitigate its disadvantages. These decisions can change
over time. Exhibit 4.6 summarizes a comparison of organizational structures.
Note that in a matrix organization, a new role is inserted in the organizational chart
that of manager of project managers. Sometimes this person leads an office called the
project management office (PMO). This does not mean that other organizations cannot
have a PMO. In some organizations, an additional manager will be in the reporting
chain between the project managers and the person in charge (shown as the president).
In other matrix organizations, the project managers report directly to the person in
charge. For simplicity, this chart shows each function with four workers and each project
with four team members. In reality, some functions may have more workers than others,
and some projects may have more team members than others. In fact, some people may
only report to a functional manager since they are not currently assigned to a project,
and others may report to more than one project manager since they are assigned on a
part-time basis to multiple projects. Those people will have more than two supervisors.
While both project managers and functional managers have certain authority in any
matrix organization, the extent of this authority can vary substantially. Often, the project
manager has authority to determine what work needs to be accomplished and by when.
The functional manager often retains authority to determine how the work is accom-
plished. Sometimes, the two managers will negotiate to determine which workers will
be assigned to the project. While both hopefully want the best for the overall organiza-
tion, each has specific responsibilities. For example, the functional manager with several
workers reporting to her wants each employee to have enough work but not be over-
loaded. She also wants all workers to grow in expertise. The project manager, on the
other hand, wants the best workers for the project so she can be more assured of deliv-
ering good results. In a case like this, when they negotiate, the project manager may want
the best resource (who is already busy), but the functional manager may offer the least
experienced resource (who is available).
EXHIBIT 4.5
PROGRESSION OF ORGANIZATIONAL FORMS
ORGANIZATIONAL
FORM FUNCTIONAL WEAK MATRIX BALANCED MATRIX STRONG MATRIX PROJECTIZED
Who has power? FM almost all FM more Equally shared PM more PM almost all
Chapter 4 Organizational Capability: Structure, Culture, and Roles 107
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One other source of potential conflict between the project and functional managers deals
with performance reviews. Often, the functional manager is tasked with writing performance
reviews, yet some workers may spend a great deal of their time on projects. If the project
managers are not allowed to provide input into the performance reviews, some project
team members will work harder to please their functional managers and the projects can
suffer. One project manager offers ideas regarding performance reviews in Exhibit 4.7.
Closely related to the organizational structure is another organizational decision that
needs to be made that of organizational culture. Project managers are not often part of
the executive group that decides on organizational structure or organizational culture,
EXHIBIT 4.7
360-DEGREE PERFORMANCE REVIEWS
In some organizations, the functional manager performs a 360-degree evaluation. This appraisal style
requires that the functional manager seek feedback from a representative sample of the staff who
have worked with that project team member to provide feedback on a 360-degree form. Being
appraised by your peers or team members on a given project is considered best practice because
they ve observed the individual in action in the trenches. Many large organizations use this
appraisal technique, since in large and/or complex organizations some staff rarely see their direct
supervisor or manager, depending upon their function in that organization.
Source: Naomi J. Kinney, CPLP, principle consultant, Multilingual Learning Services.
EXHIBIT 4.6
ORGANIZATIONAL STRUCTURE COMPARISON
FUNCTIONAL MATRIX PROJECTIZED
Who makes most
project decisions?
Functional manager Shared Project manager
Advantages Good discipline-specific
knowledge
Easy for central control
Effective for shared resources
One boss
Clear career path for
professionals
Flexible
Easy to share resources
Good cooperation between
departments
More input for decisions
Wide acceptance of decisions
Good discipline-specific
knowledge
Effective integration on
project
Increased knowledge transfer
between projects
Break down department
barriers
Shorter response time
Quicker decisions
One boss
Enhanced project team
identity
Customer focus
Effective integration on
project
Disadvantages Slow communication between
departments
Slow response to change
Slow decision making
Two bosses
Many sources of conflict
More meetings
Slow reaction time
Hard to monitor and
control
Duplication of resources
Rules not always respected
Potential lessons learned can
be lost
Discipline-specific knowledge
can slip
Less career continuity for
project team members
Source: Adapted from Richard L. Daft, Management, 9th ed. (Mason, OH: South-Western Cengage Learning, 2010): 250 255; and PMBOK® Guide, 21 26.
108 Part 2 Leading Projects
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but they certainly need to understand how these decisions impact reporting relation-
ships, decision-making methods, and commitment for their projects.
4-2 Organizational Culture and Its Impact on
Projects
Just as project managers need to understand the structure of the parent organization, they
also need to understand the culture of the parent organization if they are to communicate
effectively. Organizational culture consists of values, social rituals, symbols, work ethics,
organizational behavior, beliefs, and practices that are shared among members of the orga-
nization and are taught to new members. Values serve as a moral compass to guide us
and provide a frame of reference to set priorities and determine right or wrong. 6 Values
are implemented through social rituals such as meetings, training, and ceremonies, along
with symbols such as work layout and dress code.7 Collectively, these can informally:
Motivate the ethical actions and communications of managers and subordinates;
Determine how people are treated, controlled, and rewarded;
Establish how cooperation, coordination, collaboration, competition, conflict, and
decision making are handled; and
Encourage personal commitment to the organization and justification for its behavior.8
Once a project manager understands the culture of the parent organization, he can
determine how to best foster the culture within his project. Many projects are completed
cooperatively between two or more parent organizations, or one organization (a contractor)
will perform the project for the other organization (a client). Whenever more than one par-
ent organization is involved, the project manager needs to understand the culture of each
well enough to facilitate effective project communications and decision making.
Gl
yn
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Jo
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om
Chapter 4 Organizational Capability: Structure, Culture, and Roles 109
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4-2a Culture of the Parent Organization
When a project manager studies the culture of the parent organization, she needs to ask
the following questions:
What is the corporate culture in general?
What are the ascribed values?
Are there standard project management practices and policies?
How is the organization viewed by others in terms of being true to its values?
How does the organization like to communicate internally and externally?
How well does the organization support project management specifically?
TYPES OF POWER One framework that is helpful in understanding a corporate
culture distinguishes the following four types of culture according to what is the most
powerful motivator:
1. Power culture
2. Role culture
3. Task culture
4. Personal culture
Power cultures exist when the supervisor exerts a great deal of economic and political
power and everyone tries to please the boss. Those in formal authority control competi-
tion, conflict resolution, and communication.
Role cultures motivate everyone to understand and closely follow their appointed
roles. Reliable workers follow formal designations of responsibility with utmost respect
for regulations and laws.
In task cultures, it is more important to get the job done than to worry about who
does the work or who gets credit. Hallmarks of task cultures are skill-based assignments,
self-motivated workers, and more deference paid to knowledge than to formal authority.
In personal cultures, people show genuine interest in the needs of workers, consider
worker development as critical to the organization s success, and display an attitude that
collaboration is satisfying and stimulating.9
Many organizations will have one dominant culture modified by at least one of the
other types. An astute person will look not only for what people say when trying to
understand the culture but also will look for actions, decisions, symbols, and stories
that guide behavior.
A variety of organizational culture characteristics make project success more likely.
These characteristics include appreciation for project management; formal recognition for
project management; collaboration to meet organizational goals; engagement of stake-
holders; desire to provide value to customers; teamwork across cultures; integrity; trust;
transparency; insistence on continual learning; knowledge management practices that are
tied to individual and organization learning; and provision of appropriate rewards and rec-
ognition. Recent research has added the following organizational culture themes as helpful
in achieving project success: vision-led, egalitarian, goal-oriented, timely and effective com-
munication, and flexible leadership with rapid decision making.10
MIDLAND INSURANCE COMPANY Midland Insurance Company espouses its
values by giving every employee the One Pager that lists the organization s mission,
strategic imperatives, and core values. The CEO will often pull his One Pager out at
meetings and expects everyone else to do likewise. In talk and in action, Midland tries
to live out the core values that comprise its organizational culture. Exhibit 4.8 shows
Midland s culture.
110 Part 2 Leading Projects
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4-2b Project Cultural Norms
While some of the project team s culture is dictated by that of the parent organization,
effective sponsors and project managers can do many things to promote good working
cultural norms within the project. Many times, participants on a project might not have
worked together previously and may even come from parts of the organization (or out-
side organizations) that have historically been rivals. The sponsor and project manager
need to understand organizational politics and work to develop cooperation both within
the core project team and among the various groups of project stakeholders. A project
team charter helps to formalize this process and set expectations specifically for existing
team members and inducting new team members.
When the project sponsor and manager are determining how to create the project cul-
ture, ethics should be an important consideration. One aspect of an ethical project culture
is to determine how people should act. Project sponsors and managers learn that they need
to act in the best interests of three constituencies: (1) the project itself attempting to
deliver what is promised, (2) the project team encouraging and developing all team
members, and (3) the other project stakeholders satisfying their needs and wants. Ethical
project managers make decisions so that one of the three constituencies does not suffer
unfairly when satisfying the other two. One list of behaviors adapted from the PMI Code
of Ethics and Professional Conduct tells project managers to exhibit the following:
Responsibility take ownership for decisions.
Respect show high regard for ourselves, others, and resources.
Fairness make decisions and act impartially.
Honesty understand the truth and act in a truthful manner.11
The other aspect of an ethical culture is how people actually act. Every project has dif-
ficult periods, and the measure of project ethics is how people act at those times. The proj-
ect manager needs to show courage both in personally making the right decisions and in
creating an atmosphere in which others are encouraged to make the right decisions. An
ethical project culture in which people know how to act and have the courage to do so
yields better ideas; when a spirit of mutual trust prevails, everyone participates with their
ideas and effective partnering relationships within and beyond the project team.
4-3 Project Life Cycles
All projects go through a predictable pattern of activity, or project management life
cycle, which we refer to as project life cycle. Project planning teams use project life
cycle models because various types of projects have differing demands. A research and
development (R&D) project may require a certain test to be performed before manage-
ment approves the expenditure of large amounts of cash, while the manager of a quality
improvement project may need to document how the work is currently performed before
EXHIBIT 4.8
MIDLAND INSURANCE COMPANY VALUES
Integrity Win/Win
Team
Humility
Strong Work Ethic
Creativity
Propriety
Sharing/Caring
Personal Growth
Source: Martin J. Novakov, American Modern Insurance Group.
Chapter 4 Organizational Capability: Structure, Culture, and Roles 111
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it makes sense to experiment with a new method. The major types of project life cycle
models, while differing in details, have some things in common:
They all have definite starting and ending points.
They involve a series of phases that need to be completed and approved before pro-
ceeding to the next phase.
The phases generally include at least one initiating, one planning, one closing, and
one or more executing phases.
The various life cycle models are all frequently adapted based on how they align
with the organizational culture and language.
We will now look at several models that represent those used in improvement, research,
construction, and Agile projects. We introduce the Agile approach to project management
immediately after its life cycle model. In the remainder of the book, we will deal with the
generic, plan-driven model that includes selecting and initiating, planning, executing, and
closing and realizing benefits, as shown in Exhibit 4.9. We will post an Agile icon in the
margin wherever we highlight how the Agile or adaptive approach is different.
4-3a Define-Measure-Analyze-Improve-Control (DMAIC) Model
Many firms use projects to plan and manage quality and productivity improvement
efforts. Various models are used for these improvement efforts. While these models
appear to be somewhat different, they all strive to use facts to make logical decisions
and to ensure that the results are as desired. The Six Sigma approach to quality improve-
ment (a popular current approach explained in Chapter 11) uses the DMAIC model. A
simple version of this model is shown in Exhibit 4.10.
EXHIBIT 4.9
GENERIC PROJECT LIFE CYCLE MODEL
Approval:
to proceed
Charter Kickoff Project
result
Administrative
closure
EXHIBIT 4.10
DMAIC MODEL
Approval:
to proceed
Problem
statement
Fact gathering
defined and
facts collected
Root causes identified
and statistically
proven
Solution
implemented
Methods in place
to maintain
improvements
112 Part 2 Leading Projects
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AGILE
4-3b Research and Development (R&D) Project Life Cycle Model
Many organizations use project management techniques to organize, plan, and manage
research and development efforts. These can vary in length from as much as a decade for
taking a new pharmaceutical product from idea to successful market introduction to as
little as a few weeks to reformat an existing food product and deliver it to a client. Some
R&D project models are complex and have many phases because of huge risks and
demanding oversight; yet some are much simpler. One simple R&D model adapted
from defense development projects is shown in Exhibit 4.11.
4-3c Construction Project Life Cycle Model
Just as in other project applications, since construction projects differ greatly in size and
complexity, a variety of project life cycle models are in use. A generic construction proj-
ect life cycle model used for design build projects is shown in Exhibit 4.12.
4-3d Agile Project Life Cycle Model
One type of model increasingly used in information systems and some other projects
allows for incremental plans and benefits. These approaches have been variously called
iterative, incremental, adaptive, or change driven. While Agile is the umbrella name, some
of the specific approaches are called SCRUM, XP, Crystal, EVO, phased delivery, rapid pro-
totyping, and evolutionary. While these models may start like other project life cycle mod-
els, they provide short bursts of planning and delivery of benefits in multiple increments
during project execution. A generic Agile project life cycle model is shown in Exhibit 4.13.
EXHIBIT 4.11
R&D PROJECT LIFE CYCLE MODEL
Approval:
to proceed
Opportunity
analysis
Business case Proven concept Prototype First lot and
hand off
EXHIBIT 4.12
CONSTRUCTION PROJECT LIFE CYCLE MODEL
Phase Pre-Planning Design Procurement Construction Start Up
Approval
to proceed
Scope definition
and execution
strategy
Procurement
and construction
documents
Materials and
services
Facilities and
processes
Production
attainment
Source: Adapted from James D. Stevens, Timothy J. Kloppenborg, and Charles R. Glagola, Quality Performance Measurements of the EPC Process: The
Blueprint (Austin, TX: Construction Industry Institute, 1994): 16.
Chapter 4 Organizational Capability: Structure, Culture, and Roles 113
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4-4 Agile Project Management
In this section, we introduce several basic ideas from Agile. In subsequent chapters, we
will explain some of them in more detail. In many situations, project managers find the
most useful method takes good practices from both plan-driven and change-driven
approaches, just as the matrix form of organizing takes good ideas from both functional
and projectized organizations.
4-4a What Is Agile?
Agile is a form of adaptive or change-driven project management largely reacting to
what has happened in the early stages of a project rather than planning everything in
detail from the start. Documentation is minimal early in the project but becomes pro-
gressively more complete. To understand Agile, one needs to know both the methods
and the mindset of Agile practice. For the methods, a project vision is developed and
shared early often as part of a charter. Project teams plan in short bursts (generally of
one to four weeks), often called sprints or iterations. The details are planned for the
upcoming iteration and very little change is allowed during it. Products are defined and
delivered one iteration at a time with an output that has business value successfully
delivered at the end of each iteration. Then the next iteration is planned. The mindset
is empowering, engaging, and openly communicating as detailed as follows.
4-4b Why Use Agile?
Traditional plan-driven project management works well in many situations, but if the scope
is hard to define early in the project and/or when much change is expected, an Agile
approach often works better. For these ill-defined and rapidly changing projects, Agile pro-
ponents claim to decrease time, cost, and risk while increasing visibility and innovation.
4-4c What Is an Agile Mindset?
While much has been written about Agile, starting with the Agile Manifesto, a simplified
version of the mindset needed to successfully plan and manage Agile projects boils down
to four key ideas:
1. Satisfy the customer by placing emphasis on outputs that fulfill their needs.
2. Engage all participants through empowerment, cooperation, and knowledge sharing.
EXHIBIT 4.13
AGILE PROJECT LIFE CYCLE MODEL
Production
release
Product
backlog
Incremental Implementation
Charter
Project
Envisioning
Requirements
Gathering
Plan
Replan Test
Develop
Close
Sprint
Plan
Replan Test
Develop
Close
Sprint
Plan
Replan Test
Develop
Close
Sprint
114 Part 2 Leading Projects
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3. Facilitate that engagement through servant leadership and visible and continual
communication.
4. Keep things simple with a sustainable pace or cadence and emphasis on process
improvement.
4-4d What Are the Key Roles in Agile Projects?
All Agile roles are more collaborative than confrontational. Arguably the most essential
role is the customer representative sometimes called the product owner. This person
ensures that the needs and wants of the various constituents in the customer s organi-
zation are identified and prioritized and that project progress and decisions continually
support the customer s desires. The customer representative does much of what a
sponsor might in traditional projects and also works with the team on a continuous
basis, often performing some of the work a project manager might on a traditional
project.
The scrum master serves and leads in a facilitating and collaborative manner, empha-
sizing the need to facilitate and remove obstacles. The scrum master is a more limited,
yet more empowering role than that of a traditional project manager. The team members
in Agile projects are assigned full time and co-located as much as possible. The teams are
self-governing, so the team now accomplishes many of the planning and coordinating
activities a project manager would typically perform.
4-4e How Do You Start an Agile Project?
An Agile project should start with a charter, as any other project should. This high-level
agreement between the product owner, scrum master, and empowered team will help
share the compelling project vision, create commitment, uncover risks, identify stake-
holders, ensure common understanding of success criteria, and establish working agree-
ments and ground rules as needed. Often, the first iteration is used to determine the
product to be built and prioritize the most valuable work for the next iteration.
4-4f How Do You Continue an Agile Project?
Perhaps the easiest way to understand the process of running an Agile project is to visu-
alize the four types of meetings (often called ceremonies) used:
1. Iteration planning meetings have the product owner share the highest value-added
output he or she would like the team to work on next, along with a definition of
what done or quality completion is. The project team then commits to how much
output it can deliver in the iteration. This meeting may include backlog grooming,
which is reprioritizing the work, or backlog grooming may be conducted in a separate
meeting.
2. Daily stand-up meetings are often held for 15 minutes early in the morning and each
team member shares the previous day s accomplishments, the plans for the current
day, and any issues. Problem solving is not done in these team meetings, but if one
teammate can help another, the two talk off-line afterward.
3. Demonstration meetings are held at least once per iteration where the team demon-
strates usable product. Only a completed, usable product is shown.
4. Retrospective meetings are held at the end of each iteration where the project team,
scrum master, product owner, and possibly other key stakeholders openly share what
worked well and what could work better by making a change of some sort. The goal is
to improve the work processes.
Chapter 4 Organizational Capability: Structure, Culture, and Roles 115
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4-4g What Is Needed for Agile to Be Successful?
Experienced and motivated team members are needed because one hallmark of Agile is
self-managed teams. Without experience and willingness to be a cross-functional team
member, the teams would likely flounder. A key stakeholder, often called the product
owner or customer, needs to commit to frequent and detailed meetings, as described
above, with the development team both for initial chartering and requirements gathering,
but also for ongoing prioritization and evaluation. Trust between the client and contrac-
tor (or user and developer) is needed because the details of the requirements and scope
are initially unknown. Trust is also needed as the client needs to prioritize to get maxi-
mum value, given time and resource constraints, and the project team needs to commit
to creating certain working output during each iteration.
4-5 Traditional Project Executive Roles
Projects do not exist in a vacuum. They exist in organizations where they require resources
and executive attention. Projects are the primary method that organizations use to reach
their strategic goals. As such, a variety of players need to be involved at the executive,
managerial, and associate levels, as shown in Exhibit 4.14. Especially in small organiza-
tions, one person may perform more than one role. For example, a sponsor may perform
some or all of the activities normally expected from the customer. The four project exec-
utive roles are the steering team (ST), the sponsor, the customer, and the chief projects
officer (CPO), often known as the project management office (PMO).
4-5a Steering Team
In small to medium-sized organizations, the steering team (sometimes known as the
executive team, management team, leadership team, operating team, or other titles)
often consists of the top person in the organization and his or her direct reports. They
should collectively represent all of the major functions of the organization. In larger
organizations, there may be steering teams at more than one level. When that occurs,
the steering teams at lower levels are directed and constrained by decisions the top-
level steering team makes. Some organizations divide the duties of the steering team by
creating project review committees and delegating tasks to them. In any event, the duties
of the steering team revolve around the following five activities:
1. Overall priority setting
2. Project selection and prioritization
3. Sponsor selection
4. General guidance
5. Encouragement
EXHIBIT 4.14
TRADITIONAL PROJECT EXECUTIVE, MANAGERIAL, AND ASSOCIATE ROLES
EXECUTIVE LEVEL MANAGERIAL LEVEL ASSOCIATE LEVEL
Steering Team (ST) Functional Manager (FM) Core Team Member
Sponsor Project Manager (PM) Subject Matter Expert (SME)
Customer Scrum master
Chief Projects Officer (CPO) Facilitator
116 Part 2 Leading Projects
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The steering team generally sets overall organizational priorities with the CEO. This is
a normal part of strategic planning, as described in Chapter 2. Once the overall organi-
zational goals have been set, the steering team agrees on the criteria for selecting projects
and then selects the projects the organization plans to execute during the year. Once the
overall project list is complete, they determine the relative priorities of the projects to
determine which will start first.
Simultaneously, the steering team often helps the CEO decide who will sponsor
potential upcoming projects. In turn, the steering team often helps the sponsor select
the project manager. In some cases, the steering team even gets involved in deciding
which critical team members will be on the project. This is especially true if very few
people in the organization have highly demanded skills. The steering team can decide
which project these people will work on as part of the prioritizing effort.
Guidance from the steering team includes feedback during formal reviews as well as
informal suggestions at other times. Since steering teams understand how important
project success is in achieving organizational objectives, they normally demand to have
formal project reviews. These can occur either at set calendar times or at a project mile-
stone, which is a significant point or event in the project. 12 At these formal reviews,
the steering team can tell the project team to continue as is, to redirect their efforts in
a specific manner, or to stop the project altogether.
In terms of informal suggestions, it is very empowering to project participants if the
steering team members ask how the project is going and offer encouragement when they
run into each other in the normal course of work. It shows project participants that their
work is important and has high visibility in the organization.
4-5b Sponsor
We defined a sponsor in Chapter 1 as a senior manager serving in a formal role given
authority and responsibility for successful completion of a project deemed strategic to an
organization s success. 13 In this sense, the sponsor is normally an individual who has a
major stake in the project outcome. Sponsors often perform a variety of different tasks
that help a project, both in public and behind the scenes. Major sponsor responsibilities
are shown by project stage in Exhibit 4.15. The sponsor for major projects is often a
member of the steering team. On smaller projects, the sponsor may hold a lower position
in the organization. The interaction indeed, the partnership of the sponsor and proj-
ect manager is critical to project success.
As a member of the steering team, the sponsor should understand the corporate strat-
egy and be prepared to help with project selection and prioritization to link each project
explicitly with organizational strategy.14 Sponsors should pick the project manager and
core team (sometimes with help from the project manager and/or others). Sponsors
should mentor the project manager to ensure that person understands his role and has
the skills, information, and desire to successfully manage the project.
In the previous chapter, we discussed chartering. Sponsors ideally take an active role in
chartering the project by creating a first draft of the business case and scope overview state-
ments for the project. If a sponsor does not take time for this, the project manager needs to
ask questions to elicit this business case and scope overview information. Then the sponsor
should insist that a milestone schedule, preliminary budget, risk identification, assessment cri-
teria, communication plan, and lessons learned be developed by the project manager and team.
In this way, the sponsor sets performance goals and establishes priorities.15 The sponsor then
either personally approves the charter or takes the charter to the steering team for approval.
As the project progresses, the sponsor helps behind the scenes by obtaining resources,
removing roadblocks, making high-level decisions, and interfacing between the project
core team and the executive team. Sponsors often share their vision for the project with
Chapter 4 Organizational Capability: Structure, Culture, and Roles 117
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various stakeholders. When providing staff, sponsors ensure they are adequate in number
and skill. This may include training. It may also include negotiating for staff. Sponsors
often let their project managers arrange this training and negotiate for resources. How-
ever, the sponsor needs to make sure that both are satisfactorily completed.
Once again, sponsors with experienced project managers may merely need to ensure
their project managers have the means in place to monitor and control their projects.
Large projects with many stakeholders often have formal kickoff meetings. The sponsor s
presence demonstrates corporate commitment. Sponsors represent the customer to the
project team. The sponsor must ensure that several important customer-related tasks
are performed as follows:
All customers (stakeholders) have been identified.
Their desires have been uncovered and prioritized.
The project delivers what the customers need.
The customers accept the project deliverables.
Again, the project manager should do much of this, but the sponsor is also responsi-
ble for its completion. While sponsors represent their projects, they also represent the
larger organization. As such, they often should be one of the first persons to determine
the need to stop a project that is no longer needed or is not performing adequately.
Finally, after the project results have been used for a period of time, the sponsor should
make sure the expected results have been achieved.
So, who makes a great sponsor? In addition to having a major stake in the project
outcome and fulfilling the responsibilities described above, the following general beha-
viors and temperaments are desirable:
Excellent communication and listening skills
Ability to handle ambiguity
Ability to self-manage
Approachability
Collaborative attitude
Responsiveness16
EXHIBIT 4.15
SPONSOR RESPONSIBILITIES BY STAGE
STAGE SPONSOR RESPONSIBILITIES
Overarching Provide resources, manage stakeholder relationships, deliver results
Selecting Identify, select, prioritize projects
Initiating Select and mentor project manager, charter project
Planning Meet key stakeholders, ensure planning
Executing Nurture key stakeholders, ensure communications, ensure quality
Closing Ensure stakeholder satisfaction, closure, and knowledge management
Realizing Ensure benefits are achieved and capability is increased
Source: Adapted from Timothy J. Kloppenborg and Laurend J. Laning, Strategic Leadership of Portfolio and Project
Management (Business Expert Press, New York 2012): 47; Timothy J. Kloppenborg, Debbie Tesch, and Chris Manolis,
Project Success and Executive Sponsor Behaviors: Empirical Life Cycle Stage Investigations, Project Management
Journal (February/March, 2014): 15 17; and Timothy J. Kloppenborg and Debbie Tesch, How Effective Sponsors
Influence Project Success, MIT Sloan Management Review (Spring 2015): 28 30.
118 Part 2 Leading Projects
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4-5c Customer
While the specific demands of the customer role are spelled out here, understand that
some or all of this role may be carried out by the sponsor particularly for projects inter-
nal to a company. When a busy customer buys something, it may be tempting to just place
an order and have it delivered. That process is fine for an off-the-shelf item or for a trans-
actional service. However, when it is a one-of-a-kind project, hands-off ordering does not
work. The question then becomes: What does a customer need to do to ensure the desired
results? Exhibit 4.16 shows a list of seven tasks a customer can do before and during a
project to enhance the probability of success. The customer performs three of these tasks
independently and the other four jointly with the project manager. The three customer-
only project tasks are prioritizing the project need, carefully selecting a good contractor,
and killing the project if necessary. The four joint tasks are writing and signing the project
charter, developing clear and detailed requirements, setting up and using project control
systems, and conducting a great project kickoff meeting.
INDEPENDENT TASKS The first requirement is to prioritize each project. The knowl-
edge that one particular project is the highest priority for a company should be
EXHIBIT 4.16
CUSTOMER TASKS ON PROJECTS
INDEPENDENT TASKS JOINT TASKS WITH PROJECT MANAGER
1. Prioritize project
2. Select good contractor
3. Kill project if needed
1. Write and sign charter
2. Develop clear requirements
3. Use control system
4. Conduct kickoff meeting
N
ej
ro
n
Ph
ot
o/
Sh
ut
te
rs
to
ck
.c
om
Chapter 4 Organizational Capability: Structure, Culture, and Roles 119
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communicated, and that project should be tackled by the A team. A related prioritiza-
tion question is: Do we need this project so badly right now that we are willing to start it
even without the skilled personnel, resources, or technology on hand that would improve
the probability of successful completion? If so, ensure this particular project gets top bill-
ing. If not, consider delaying it. A third prioritizing decision that needs to be made
repeatedly is what project requirements must be satisfied first so the project team is
working on what matters most to the customer.
The second customer task is to carefully select a competent and honest contractor to
perform the project. All of the important joint tasks are much easier with the right con-
tractor, the probability of success goes up, and everyone s stress level goes down.
The third customer task is to determine whether to pull the plug on a troubled project.
This could happen right at the start if the project appears to be impractical. It could happen
during detailed planning when the requirements, schedule, budget, risks, or other aspects indi-
cate trouble. More often, it occurs during project execution when the project progress does not
live up to the plan. A customer needs to decide when to stop throwing good money after bad.
JOINT TASKS WITH PROJECT MANAGER The first joint task for customers and
project managers is to create and ratify the project charter. The charter is a broad
agreement concerning the project goals, rationale, risks, timeline, budget, approach,
and roles even though all of the details have yet to be determined. The charter should
help to identify projects that appear risky or otherwise impractical from the outset.
These projects should either be scrapped, or a different approach should be used. If
the project looks promising, both the contractor and the customer normally sign the
charter and feel morally bound to its spirit.
Once the charter is signed, the contractor and customer need to develop detailed
requirements. Some of the challenges many customer companies face are differing
project expectations among the members of the organization. Somehow, the conflicting
desires of multiple people in the customer s organization must be combined into one
set of requirements that will be provided to the people who will perform the project
work. Senior customer representatives and project managers frequently work together
to determine the requirements.
The customer and the contractor often collaborate on the setup and use of several
project control systems. One of these is a communications plan (which is explained in
Chapter 6). Since the customer is often the recipient of communications, he needs to
tell the contractor what he needs to know, when he needs to know it, and what format
will be most convenient. This should include regular progress reports. Second is a change
control system (explained in Chapter 7). Most projects will have multiple changes. A
method must be created to approve potential changes, document their impact, and
ensure that they are carried out as agreed. Third is a risk management system (explained
in Chapter 11). Customers should work with developers to brainstorm possible risks,
consider how likely each risk is to occur, measure a risk s impact should it happen, and
develop contingency plans. The customer needs to ensure that effective communications,
change management, and risk management systems are used.
Customers must help plan and participate in a project kickoff meeting. This meeting
should be widely attended, give everyone involved in the project a chance to ask ques-
tions, and be used to build excitement for the project.
Customers get what they pay for on projects, but only when actively involved in key
activities. Customers have the sole responsibility of prioritizing their own needs, selecting
a contractor to perform their project, and terminating a project that is not working. Cus-
tomers and contractors share the responsibility for crafting and agreeing to a project
charter, articulating requirements, developing and using project control systems, and
conducting an informative and energetic project kickoff.
120 Part 2 Leading Projects
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4-5d Chief Projects Officer/Project Management Office
Organizations need to have one person who owns their project management system
and is responsible for all the people who work on projects. While different companies
use different titles for this position (such as project director or manager of project man-
agers), we will use the title chief projects officer (CPO). Just as companies size and com-
plexity vary greatly, so does the role of CPO. Large companies frequently have a project
management office (PMO). The PMO performs the CPO role. At small companies, the
CPO role may be performed informally by the CEO, who also juggles many other time
demands. Companies in the medium-size range may find it useful to appoint an execu-
tive who already has other responsibilities as the CPO. Ensuring projects are planned
and managed well is so central to the success of most companies that a highly capable
individual is normally assigned this responsibility.
To be effective, the CPO must consider organizational enablers for project success:
these include standardized supporting processes such as approvals and appointments;
standardized execution guidance such as performance assessment criteria and templates;
well-defined responsibility systems such as sponsor and project team roles; and a mature
organizational structure that fosters cooperation and joint problem solving.17
So, what are the responsibilities of the chief projects officer? They include ensuring
that the company s steering team:
Identifies potential projects during strategic planning
Selects a manageable set of projects to be implemented
Prioritizes effectively within that set
Ensures enough resources (people, money, and other resources) are available to per-
form the projects
Selects appropriate project sponsors and teams
Charters the project teams
Monitors and controls the implementation of the projects
Rewards the participants
Celebrates the results of successful projects!
If that is not enough, the CPO also ensures that each individual serving on a project:
Receives the training he or she needs
Captures lessons learned from completed projects
Uses lessons learned from previous projects on new projects
Uses templates and standards when appropriate
4-6 Traditional Project Management Roles
The manager-level roles in traditional projects include the functional manager, project
manager, and facilitator.
4-6a Functional Manager
Functional managers are often department heads. Projects come and go, but departments
generally remain. Functional managers have a large role in deciding how the project
work in their functional area is done. Functional managers and project managers may
negotiate who will be assigned to work on the project.
Generally, top management in an organization needs to decide how the relative
decision-making power in the organization is divided between project managers and
functional managers. Organizations that are new to formalized project management
often start with functional managers having more power. Often, this changes over time
until project managers for big projects have relatively more power.
Chapter 4 Organizational Capability: Structure, Culture, and Roles 121
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4-6b Project Manager
The project manager is the focal point of the project. He or she spends a large amount of time
communicating with everyone who is interested in the project. The project manager leads the
planning, execution, and closing of the project. This person ideally should be a flexible, facili-
tating leader. Since project managers are responsible for the project schedule, they have a
large role in deciding when project activities need to be accomplished. Project managers are
trusted with delivering project results needed by their parent organizations. As such, project
managers need to be worthy of that trust by possessing both integrity and necessary skills.
DESIRED BEHAVIORS Exhibit 4.17 shows a few of the behaviors project managers
can develop first in regard to integrity and then in regard to each of the 10 project man-
agement knowledge areas needed to successfully plan and manage projects. This book
describes some of the factual knowledge project managers need to acquire to become
proficient. Project managers also need to acquire experiential knowledge by practicing
EXHIBIT 4.17
DESIRED PROJECT MANAGER BEHAVIORS
INTEGRITY: A PM demonstrates integrity by making honest decisions, protecting people, defend-
ing core values, leading major change, honoring trust, showing respect, establishing a culture of
honesty, and displaying total commitment to project and people.
INTEGRATION: A PM is an effective integrator by leading the chartering process, coordinating
assembly of a detailed and unified project plan, balancing the needs of all stakeholders, making logi-
cal trade-off decisions, and keeping focus on primary objectives.
SCOPE: A PM deftly handles project scope by obtaining a deep understanding of stakeholder wants
and needs, determining true requirements, learning if proposed changes are essential, stopping
unnecessary scope creep, and demonstrating needed flexibility.
TIME: A PM is an effective scheduler by leading schedule development, understanding resource and
logic limitations, understanding the project life cycle, focusing on key milestones, and making
schedule decisions while being aware of cost and scope issues.
COST: A PM maintains cost control by developing an accurate understanding of project scope,
determining reliable cost estimates, controlling all project costs, and calculating and honestly report-
ing all variances in a timely and transparent manner.
QUALITY: A PM achieves project quality by learning customer expectations and how they relate to
organizational objectives, insisting project decisions are based upon facts, utilizing lessons learned,
ensuring effective work processes are used, and leading testing.
HUMAN RESOURCES: A PM effectively handles human resource issues by leading in a facilitating
manner when possible and forcefully when needed, attracting and retaining good workers, develop-
ing a self-directed project team, and creating a sense of urgency.
COMMUNICATIONS: A PM displays good communications by listening and speaking well, advo-
cating the project vision, maintaining enthusiasm, focusing attention on key issues, establishing
order, working through conflict, seeking support, and openly sharing.
RISK: A PM effectively deals with project risk by openly identifying risks and opportunities, hon-
estly evaluating each, developing avoidance strategies when practical and mitigation strategies when
needed, and courageously recommending needed actions.
PROCUREMENT: A PM effectively procures needed goods and services by accurately documenting
all requirements, identifying and fairly considering all potential sellers, proactively managing con-
tracts and relationships, and ensuring all deliveries.
STAKEHOLDER: A PM deals effectively with stakeholders by robustly identifying all who are
interested in the project, asking probing questions to understand their desires, and ensuring someone
on the project team maintains effective relationships with each.
122 Part 2 Leading Projects
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these behaviors on projects. Not all project managers will become equally adept at each
behavior, but an understanding of the behaviors exhibited by excellent project managers
is a great way to start. Remaining chapters in this book elaborate on these behaviors.
Collectively, all of these skills make for a great, well-rounded project manager.
COMMUNICATION CHANNELS Envision a bicycle wheel, as shown in Exhibit 4.18. The
project manager is like the hub, and the spokes are like the many communication channels
the project manager needs to establish and use with project stakeholders. While there are
many project manager requirements, some of the technical needs can probably be delegated,
but every project manager needs integrity, leadership, and communications skills.
CHALLENGES Project managers deal with several challenges. One is that they often
have more responsibility than authority. This means they need to persuade people to
accomplish some tasks rather than order them to do so. Project managers can create inter-
esting and challenging work assignments for their team members. Many people find this
stimulating. Project managers can more effectively attract followers when they display high
integrity and the ability to get the job done. This includes both technical ability and com-
munications ability. Project managers primarily deal with networks of people both within
and outside their parent company. An effective project manager knows how to get to the
source of the networks. A challenge for project managers is determining how networks
function within certain organizational cultures. This is why organizational culture is so
important. What are the networks within the organization? How do people work, commu-
nicate, and problem solve beneath the function of their job titles?
A rookie project sponsor and rookie project manager should not be assigned to the
same project. While the sponsor normally mentors the project manager, when a sponsor
is new, some of the mentoring may go the other way just as a master sergeant may help
a new lieutenant learn about leading troops.
JUDGMENT CALLS Due to the very nature of projects each one having a unique set
of stakeholders, output, and project team project managers cannot always follow a cook-
book approach in how they manage. They must develop judgment. Exhibit 4.19 lists some
judgment calls that project managers need to be prepared to make on a frequent basis.
COMPETENCIES BY PROJECT STAGE Just as sponsor demands vary by project life
cycle stage, so do those of project managers, as shown in Exhibit 4.20.
PROJECT LEADERSHIP Many people have become convinced that project managers
need to provide leadership in various ways. Knowing the tools and techniques of project
management and even knowing the content of the PMBOK Guide is useful, but not
enough to be a great project manager. A dozen of the more common leadership chal-
lenges faced by project managers are shown in Exhibit 4.21. Anther way to understand
EXHIBIT 4.18
PROJECT MANAGER COMMUNICATION CHANNELS
Project Manager
Stakeholders
Chapter 4 Organizational Capability: Structure, Culture, and Roles 123
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leadership demands of project managers is to consider the core competencies at a glance
shown in Exhibit 4.22.
4-6c Facilitator
Some project management situations require facilitation because the situation is so com-
plex and/or because the opinions are so varied. Sometimes, the workers on a project need
to expand their thinking by considering the many possibilities (possible projects,
approaches, risks, personnel, and other issues). Other times, the workers on the project
EXHIBIT 4.19
PROJECT MANAGER JUDGMENT CALLS
A few general questions project managers need to ask themselves is when to:
Act versus analyze
Lead versus follow
Lead versus administer
Repeat versus change
Change expectations versus accept them
Take over versus let the team perform
Focus on the big picture versus focus on details
Focus on technical versus focus on behavioral
Focus on short term versus focus on long term
Promote order (control) versus promote innovation (freedom)
Allow (constructive) conflict versus discourage (destructive) conflict
Focus communications inside the project versus focus communications outside
Demonstrate optimism versus demonstrate pessimism
Advocate for the project versus accept termination
Focus on project goals versus organizational, personal, or team member goals
Enhance, maintain, or accept changes in scope, quality, cost, and schedule
EXHIBIT 4.20
PROJECT MANAGER COMPETENCIES BY PROJECT LIFE CYCLE STAGE
STAGE COMPETENCY
Initiation Effective questioning/generating feedback
Persuasiveness/Marketing/Selling
Listening skills
Vision oriented/articulate the business problem
Consensus building
Planning Project management skills and knowledge
Consensus building
Technical skills/theoretical knowledge
Implementation Ability to get along/team player
Results oriented
Truthful/honest
Close Writing skills
Share information and credit
Pride in workmanship/qualitytruthful/honest
Source: Gregory J. Skulmoski and Francis T. Hartman, Information Systems Project Manager Soft Competencies: A
Project-Phase Investigation, Project Management Journal (March 2010): 61 77.
124 Part 2 Leading Projects
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EXHIBIT 4.21
A DOZEN PROJECT LEADERSHIP CHALLENGES
General Project Leadership
Provide situational and shared leadership
Develop trust
Manage and negotiate conflicts
Manage political, social, cultural, and ethical issues
Team Leadership
Develop high-performing project teams
Participate in self-organizing project teams
Overcome team-building obstacles
Facilitate team decision making
Stakeholder Leadership
Engage all stakeholders
Influence stakeholder behavior
Maintain effective multidirectional communications
Deal with changes in the environment and within the project
Source: Adapted from unpublished discussion of Project Management Executive Forum meeting, October 10, 2106,
Cincinnati, OH.
EXHIBIT 4.22
AGILE PROJECT LIFE CYCLE MODEL
Decision maker,
lead by example,
have integrity
Strategic thinker,
company goals
Skills training,
ongoing education
PMI Certification:
PMP®, CAPM®
Different size projects
& complexity
Stakeholders,
project teams,
communicator
Goal setting,
results driven,
be accountable
Finance, customer
& internal needs
PM terminology,
PM best practices
Program Mgmt,
Agile, other PMI
certifications
Virtual teams, global
projects
Motivate, inspire,
reward and
recognize
Ask questions,
active listener,
follow-through
Industry, market Sales skills,
continuous
improvement
Industry and
technical
certifications
Diversity in viewpoints,
backgrounds, teams,
cultures
Relationship
builder, influencer,
get buy-in
Project leader and
business leader
Competition,
trends
Project close-out:
use Lessons
Learned
Volunteer projects,
contribute your
expertise
Proven success on
projects and teams
Maximize
everyone’s
strengths
Core Competencies
Experience
Certification
Knowledge
Business
Leadership
Developed by Connie Plowman, PMP, based on her experiences as a hiring manager, practitioner and instructor. connie@plowman.us www.linkedin.com/in/connieplowman
PASSION
People
Source: Connie Plowman, PMP, Chief Operating Officer (retired), PMI Eric Jenett Project Management Excellence Award Recipient
Chapter 4 Organizational Capability: Structure, Culture, and Roles 125
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AGILE
need to focus their thinking by selecting from many options (a project, an approach, a
contractor, or a mitigation strategy). Most project managers and sponsors can and do facil-
itate many meetings. However, the project manager may prefer to focus on the content of
a meeting and enlist a facilitator to help focus on the process of the meeting. In these
situations, an outside facilitator may be useful. Often, a disinterested sponsor or project
manager (one who works on other projects, but not on this one) is used when a facilitator
is needed. Sometimes, the chief projects officer or an outside consultant is used to facilitate.
4-7 Traditional Project Team Roles
The team- or associate-level roles in projects are core team members and subject matter
experts (SMEs).
4-7a Core Team Members
Core team members are the small group of people who are on the project from start to
finish and who jointly with the project manager make many decisions and carry out
many project activities. If the project work expands for a period of time, the core team
members may supervise the work of SMEs who are brought in on an as-needed basis.
Ideally, the core team is as small as practical. It collectively represents and understands
the entire range of project stakeholders and the technologies the project will use. It is
generally neither necessary nor useful to have every single function represented on the
core team, since that would make communication and scheduling meetings more diffi-
cult. Also, if every function is represented directly, team members tend to fight for turf.
The ideal type of core team member is one who is more concerned with completing
the project (on time, with good quality, and on budget, if possible) than with either per-
sonal glory or with only doing work in his or her own discipline. He or she does what it
takes to get the project done.
4-7b Subject Matter Experts
While core team members are typically assigned to the project from start to finish, many pro-
jects also have a specific and temporary need for additional help. The necessary help may be
an expert who can help make a decision. It may be extra workers who are needed at a busy
time during the life of the project. Some extra help may be needed for as little as one meeting;
other extra help may be needed for weeks or months. These extra helpers are often called
subject matter experts (SMEs) since they are usually needed for their specific expertise.
SMEs are brought in for meetings and for performing specific project activities when nec-
essary. A project could have almost any number of SMEs, depending on its size and com-
plexity. SMEs are not on the core team but still are essential to the project. SMEs may be on
a project for a long time and thus be almost indistinguishable from core team members.
However, SMEs may spend only a little time on a particular project and, therefore,
may not relate strongly to it. At times, it is a struggle to get them scheduled and com-
mitted. Typically, a project manager would have a newly assigned SME read the project
charter and the minutes from the last couple of meetings before discussing the project
with him. It is a balancing act to ensure that the SME understands what she needs to
do and how important it is, without spending a great deal of time in the process.
4-8 Role Differences on Agile Projects
Agile project management roles are shown in Exhibit 4.23. Most of the same work still
needs to be accomplished in organizations using Agile methods. Some of the work is
126 Part 2 Leading Projects
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performed by different people as there is an emphasis on empowering teams, and some
is performed at different times as requirements and scope emerge gradually instead of
just at the project start. Collaborative effort and communication specifically with the cli-
ent are common features of Agile project teams.
On Agile projects, arguably the most essential role is the customer representative
sometimes called the product owner. This person is responsible for the return on
investment earned by the project and accepting or rejecting acceptance of deliverables
at the end of each iteration. The customer representative ensures that the needs and
wants of the various constituents in the customer s organization are identified and pri-
oritized and that project progress and decisions continually support the customer s
desires. In Agile projects, the customer representative role is so continuous and active
that we show it as both an executive- and managerial-level role. The customer repre-
sentative does much of what a sponsor might in traditional projects, but there also may
be a designated sponsor (sometimes known as a product manager) who controls the
budget. The customer representative or product owner works with the team on a con-
tinuous basis, often performing some of the work a project manager might on a tradi-
tional project.
A portfolio team often performs much of the work of a traditional steering team and
a similar office that may be titled differently, such as scrum office, performs much of the
work of a project office.
The scrum master serves and leads in a facilitating and collaborative manner. In
effect, this is a project manager who serves and leads in a collaborative, facilitating
manner. This is totally consistent with contemporary project management since many
individuals do much better work when they actively plan rather than have work
assigned to them. The scrum master guides team members as they prioritize tasks and
removes obstacles to their progress. This is a more limited, yet more empowering role
than the traditional project manager. In this book, we consider the scrum master to be
the project manager.
The functional manager (sometimes called a resource manager) has a similar, but
sometimes more limited, role than the traditional department head. Many organizations
using Agile also have a coach acting as a facilitator and trainer.
The team members in Agile projects are assigned full time as much as possible, so
there are very few subject matter experts. The teams are self-governing, so the team
now accomplishes many of the planning and coordinating activities a project manager
would typically perform. Small and co-located teams often characterize Agile projects
and they work closely together. They organize themselves and exhibit significant matu-
rity. They create their own estimates and report to each other daily. The same mem-
bers should be on the team for the entire project or at least for an entire iteration,
EXHIBIT 4.23
AGILE PROJECT ROLES
EXECUTIVE ROLES MANAGERIAL ROLES ASSOCIATE ROLES
Customer (product owner) Customer (product owner) Team Member
Sponsor (product manager) Scrum Master
Portfolio Team Functional Manager
Project Management/Scrum Office Coach
Chapter 4 Organizational Capability: Structure, Culture, and Roles 127
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although the team can change from one iteration to the next. The members should be
co-located and assigned to the project full time for the duration of the iteration.
PMP/CAPM Study Ideas
When it comes to studying for the CAPM or PMP exams, make sure you know the Proj-
ect Management Code of Ethics & Professional Conduct (referenced on p. 111 of this
chapter) inside and out. This is one of the few things not found in the PMBOK® Guide
itself but can be accessed directly from the PMI website. While only eight pages long,
this code generally shows up multiple times on either test, thus providing a great deal
of bang for your buck in terms of studying.
In this chapter, we highlight the fact that a project s life cycle is often industry-specific
or even unique to an organization. Regardless, PMI has identified five generic Process
Groups, representing the stages that are typical of most projects. These include Initiation,
Planning, Executing, Monitoring & Controlling, and Closing. You will be expected to
know these in a great deal of detail, including inputs and outputs of each stage; into
which process group and knowledge area each of the 49 individual processes fit; and
how these processes interact with one another. This flow is shown graphically in the
inside back cover of this book to help you visualize it. This will require a tremendous
amount of studying and should not be underestimated.
Summary
Projects are accomplished either within an organization or
between multiple organizations when different firms work
together. Project managers are more effective if they under-
stand the impact the organization has on the project. In
contemporary society, different organizations choose dif-
ferent organizational structures because they feel there is
an advantage in their unique circumstances. While many
are still officially organized in a traditional functional man-
ner, an increasing number of organizations have at least
informal matrix relationships. The days of having only
one boss are gone for many workers and especially for
many project managers. Each form of organization has
strengths and challenges with respect to projects.
Organizations also have a culture the formal and
informal manner in which people relate to each other
and decisions are made. The hierarchical approach with
the boss having supreme authority has long vanished in
many places. Many organizations today use a more col-
laborative approach some much more than others.
Whatever the approach, project managers need to
understand it and the impact it creates on their project.
Project managers and sponsors need to create a culture in
their project that is consistent with, or at least can work
effectively with, that of the parent organization. Both
organizational structure and culture can become more
complicated if more than one organization is involved
in the project and if they differ in these respects.
Projects follow a predictable pattern or project life
cycle. Many industries have typical project life cycles,
but they vary greatly. A project manager needs to at
least understand what project life cycle model is used at
her organization and often needs to select or modify the
project life cycle to the specific demands of the project.
Multiple executive-, managerial-, and associate-level
roles need to be performed in projects. The project
manager is a central role and the subject of this book.
Project managers need to understand the other roles
and relate effectively to them, regardless of whether
their project is being conducted using a traditional,
Agile, or hybrid approach.
Key Terms Consistent with PMI Standards and Guides
functional organization, 102
projectized organization, 104
co-location, 105
matrix organization, 105
agile, 114
milestone, 117
128 Part 2 Leading Projects
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Chapter Review Questions
1. Describe how a strong (project) matrix is differ-
ent from a weak (functional) matrix.
2. Which organizational structure is often used for
small projects that require most of their work
from a single department?
3. List advantages and disadvantages of
functional, projectized, and matrix forms of
organization.
4. What is co-location, and why is it used?
5. What are organizational values, and why should
a project manager be aware of them?
6. List and describe four different types of corporate
culture.
7. If more than one parent company is involved in a
project, why is it important for the project man-
ager to understand the culture of each?
8. The project manager and sponsor need to
act in the best interest of which three
constituencies?
9. According to the PMI Code of Ethics and Profes-
sional Conduct, project managers need to exhibit
which four behaviors?
10. In your own words, describe an ethical project
culture.
11. What are some characteristics of almost all proj-
ect life cycles?
12. What does the DMAIC model acronym stand
for? When is this type of model used?
13. What distinguishes an Agile project life cycle
model from other types of life cycle models?
14. For what five activities is the project steering
team responsible?
15. Who should select the project manager and the
core team?
16. Who is responsible for ensuring that the steering
team completes its tasks?
17. What types of control systems should a customer
and contractor work together to set up and utilize?
Discussion Questions
1. Marissa Mayer, former CEO of Yahoo!, sparked a
national debate when she insisted that all her
employees be physically present for work. Debate
the merits of co-location, including its advan-
tages and disadvantages.
2. Identify each of the four organizational culture
types with respect to power, and the strongest
motivator for each type. In which organizational
cultures do you feel most and least comfortable
working? Why?
3. List and describe at least four organizational cul-
ture characteristics that increase the likelihood of
project success. Why is each characteristic helpful?
4. Explain multiple methods through which project
managers can lead by example.
5. Define your personal project code of ethics.
6. Brainstorm techniques that effective project lea-
ders can use to resolve ethical conflicts on
projects.
7. You work for a software company. What benefits
do you achieve by utilizing an Information Sys-
tems project life cycle model as opposed to other
project life cycle models?
8. If a project will be divided into many phases,
which life cycle model would you recommend
using to plan it? Why?
9. Describe a possible imbalance between a project
manager s authority and responsibility. What
impact might it have on a project?
10. Is it important to choose a member from every
impacted function of a project for the core team?
Explain why or why not.
PMBOK ® Guide Questions
1. All of the following are characteristics of a pro-
jectized organization except:
a. Decision making is streamlined.
b. Coordination is the responsibility of project
managers.
c. Functional managers have the majority of
authority.
d. Focus is on the customer.
2. Characteristics of an organizational culture can
have a major impact on a project s success. All
of these are attributes of an organizational cul-
ture except:
a. motivation and reward systems
b. risk tolerance
c. code of conduct
d. financial control procedures
Chapter 4 Organizational Capability: Structure, Culture, and Roles 129
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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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3. organization structures can be clas-
sified as weak, balanced, or strong, depending on
the relative level of influence between the func-
tional manager and the project manager.
a. Silo
b. Matrix
c. Composite
d. Projectized
4. A hierarchical organization where each employee
has one clear superior, and staff are grouped by
areas of specialization and managed by a person
with expertise in that area is known as a:
a. composite organization
b. functional organization
c. projectized organization
d. weak matrix organization
5. In an Agile life cycle model, .
a. the scrum master controls the team
b. detailed planning precedes execution
c. customer requirements are gathered early in
the project
d. the team is self-directed
6. The project sponsor s responsibilities during the
executing stage include:
a. reviewing and signing the project charter
b. signing off on the detailed project plan
c. ensuring communications with key
stakeholders
d. producing project status reports
7. Group phenomena that evolve over time and
include established approaches to initiating and
planning projects, the acceptable means for
getting the work done, and recognized decision-
making authorities are referred to as:
a. organization structures
b. roles and responsibilities
c. project culture (norms)
d. vision and mission
8. Customer responsibilities on a project might
include all of the following except:
a. perform the work of the project to achieve its
objectives
b. advise on project requirements
c. review and accept project deliverables
d. participate in status or kickoff meetings
9. The Chief Projects Officer s or PMO s responsi-
bilities might include:
a. signing the project charter
b. ensuring enough resources are available to
perform the project
c. working with the team to create a project
schedule and budget
d. promoting the project at the executive level of
the organization
10. PMI s Code of Ethics and Professional Conduct is
a guide for project management practitioners
that describes the expectations that they should
hold for themselves and others. Which of these is
not one of the desired behaviors and basic obli-
gations referenced by the code of conduct?
a. fairness
b. honesty
c. authority
d. respect
Exercises
1. Given a scenario, select a preferred organiza-
tional structure and justify your selection.
2. Describe examples of ethical (or nonethical) behav-
ior as outlined in PMI s Code of Ethics and Profes-
sional Conduct exhibited on a project in the news.
3. Describe, with examples, how a project manager
on a project you have observed did or did not
exhibit desirable project manager behaviors as
described in Exhibit 4.17.
4. Briefly describe how the sponsor of your project
is or is not displaying appropriate life cycle
specific behaviors as described in Exhibit 4.15.
I N T E G R A T E D E X A M P L E P R O J E C T S
SUBURBAN HOMES CONSTRUCTION PROJECT
Suburban Homes, once a medium-sized company, is rapidly ex-
panding its business to southern states and is focused on main-
taining its status as the fastest-growing construction company in
the Midwest region of the United States. Its significant growth
and good reputation for building quality single-family homes
and townhomes presents both challenges and opportunities.
130 Part 2 Leading Projects
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Semester Project Instructions
For your example project, describe the organizational
structure of the agency or company for which you are
planning the project. Describe as many of the organiza-
tional culture attributes as you can. List, by name, as
many of the project executive, management, and team
roles as you can identify. Be sure to assign roles to your-
self and your classmates if you are doing the project as a
team. How do you anticipate that the organizational
structure, culture, and role assignments help or hurt
your ability to successfully plan this project? Describe
the project life cycle model that is used in the
organization and if one is not currently used, describe
the life cycle model you plan to use and tell why it is
appropriate.
CASA DE PAZ DEVELOPMENT PROJECT
First, the organizational structure for Casa de Paz is in a sepa-
rate document. We still need names of individuals who are
volunteering for each working group. For this book, we will list
names by first name and initial of last name to protect privacy.
How do you envision this organization operating? Casa de
Paz has a strong ethos of community, rooted in values of
human dignity and a recognition that all of us thrive better in
an atmosphere of mutual respect and care. Every subset of
the community, from board members to staff to volunteers
and affiliates to residents, communicates care and respect in
their interactions with one another. Other behavioral norms
stem from both these values and the vulnerability of the popu-
lation we serve. Given the need, at times, for the organization
to respond rapidly to serious, stressful, even life-threatening
situations, board members, working group members, and
even volunteers need to maintain confidentiality, think carefully,
use discretion, and behave in a trustworthy manner.
For each project selected, we will have one person from
the board serve as sponsor (product owner) and one person
from the respective working group serve as project manager
(scrum master). The product owner for multiple products is
sometimes referred to as a product manager. This person is
Gillian A. The chair of the board and the scrum master for the
entire effort is ___.
Since Casa de Paz is a 501(c)(3) nonprofit organization, part
of the culture is voluntary. One challenge from a project man-
agement perspective is to get people to commit to completing
certain work according to schedule when many have other full-
time jobs. Helping the project teams make team decisions may
be relatively easy. The pillars of PMI s Code of Ethics and Pro-
fessional Conduct of responsibility, respect, fairness, and hon-
esty should be very well accepted and valued.
An Agile approach makes the most sense for this project
as many of the requirements are poorly understood at the
start and many things are changing rapidly such as having
two buildings to consider with competition for both such that
a third building might need to be found. Also, in Agile, we ask
for commitment. If the team cannot commit to the body of
work for the iteration, the plan is changed. The commitment
is made at the team level at the start of the iteration.
Suburban Homes is considering various options to
expand its operations while retaining its focus on managing
resources effectively and efficiently to increase profits:
Given the nature of its projects, Suburban Homes is con-
sidering either a projectized or matrix organization struc-
ture. However, a functional organization structure has not
been ruled out.
With its focus on maintaining high quality in its construction
tasks and end-product (home for the customer) as well as
quality assurance in implementing project management pro-
cesses, the company is actively considering a combination
of the DMAIC model with a traditional project life-cycle
approach.
Organization culture plays an important role in sustaining
and promoting efficiency. The culture, in turn, is influenced
by the organization structure. Suburban Homes is highly
committed to employee development and functional exper-
tise through training, mentoring, and collaborative learning.
Which type of organization structure is more suitable as
Suburban Homes opens new offices in other states? What is
your advice to the company to address all these issues com-
prehensively and coherently?
Chapter 4 Organizational Capability: Structure, Culture, and Roles 131
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PROJECT MANAGEMENT IN ACTION
Project Leadership Roles at TriHealth
TriHealth is a company that manages several large
hospitals and a variety of other health organizations,
such as physical fitness facilities and nursing services.
Due to the company s increasing size and complexity,
TriHealth leadership decided they needed to formally
define roles of project executive sponsor, project
leader, performance improvement consultant, core
team member, and subject matter expert. These roles
are shown as follows.
Project Executive Sponsor Initiating
Stage
Empower Project Leader with well-defined char-
ter, which is the overarching guide
Clearly define expected outcomes
Demonstrate commitment to and prioritization of
project
Definedecision-makingmethods andresponsibility
sponsor/project leader/team
Partner with Project Leader to identify obstacles,
barriers, and silos to overcome
Planning Stage
Ensure Project Leader understands business con-
text for organization
Ensure Project Leader develops overall project plan
Assist Project Leader in developing vertical and
horizontal communication plan
Demonstrate personal interest in project by invest-
ing time and energy needed
Secure necessary resources and organizational
support
Executing Stage
Communicate and manage organizational politics
Visibly empower and support Project Leader ver-
tically and horizontally
Build relationships with key stakeholders
Actively listen to and promote team and project to
stakeholders
Remove obstacles and ensure progress of project
Ensure goals are met and stakeholders are
satisfied
Closing Stage
Ensure closure; planned completion or termination
Ensure results and lessons learned are captured
and shared
Ensure assessment of related applications or
opportunities
Ensure any necessary next steps are assigned
and resourced
Recognize contributions and celebrate completion
Negotiate follow-up date(s) to assess project status
Project Leader
All of the roles listed are the ultimate responsibility of
the Project Leader. However, in the development of
the charter, the Sponsor and the Project Leader will
have a discussion about the Project Leader role. At
that time, the individuals will determine if the Project
Leader needs additional assistance or skills to facili-
tate the project success and which of these responsi-
bilities need to be delegated to others with expertise
in those areas.
Leads negotiation with Sponsor for charter
definition.
Collaborates with Sponsor to clarify expectations.
Provides direction to the team with integrity, lead-
ership, and communication skills.
Facilitates productive meetings and supports the
team s decisions.
Prepares the high-level work plan and timeline.
Champions the project on the management level
and with the staff.
Leads the implementation of the project.
Manages project flow, including agenda setting,
meeting documentation, and coordination of
team assignments.
Develops implementation, education, and com-
munication plans for the project.
Responsible for the team and project progress
and proactively intervenes to promote team and
project success.
Identifies, communicates, and facilitates the re-
moval of barriers to enable successful project
completion.
132 Part 2 Leading Projects
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Supports the team with tools and methodologies
to accomplish goals.
Facilitates collection and analysis of data.
Leads the team in developing a plan to sustain the
change and monitor effectiveness.
Leads the team in developing recommended next
steps.
Closes project with Sponsor and ensures lessons
learned are captured.
Establishes with Sponsor the dates for post-
project checkup and overall measurable effective-
ness of project.
Performance Improvement Consultant
If the Sponsor and the Project Leader determine
additional support/expertise is needed, a Performance
Improvement Consultant can provide the following
expertise:
Provides direction to the Project Leader in estab-
lishing targets and a measurement and monitor-
ing system.
Mentors the Project Leader on leading the team
through the project management process.
Collaborates with the Project Leader to prepare a
work plan and timeline for the project.
Proactively intervenes to promote team and
project success based on teamwork and
interactions.
Assists the Project Leader in identifying, commu-
nicating, and removing barriers to enable suc-
cessful project completion.
Assists in the researching, best practices, and
benchmarking.
Coaches the Project Leader on the development
and implementation of a comprehensive commu-
nication, education, and change management
plan.
Provides the Project Leader support in ensuring
regular communication with the Sponsor and
Stakeholders.
Offers expertise to the team with tools and meth-
odologies to accomplish goals.
Collaborates with the Project Leader on the collec-
tion and analysis of data.
Ensures a system-wide perspective is considered
and downstream effects analyzed.
Provides change management education and
assists the Project Leader in developing key strat-
egies for successful change management.
Provides coaching to the Project Leader on key
strategies for successful planning, implementa-
tion, and sustainability of the project.
Core Team Member
Takes responsibility for the success of the team.
Attends meetings for duration of the project.
Actively participates in team meetings.
Understands the entire range of the project.
Actively participates in the decision-making process.
Supports the team s decisions.
Completes outside assignments.
Carries out many of the project activities; pro-
duces deliverables on time.
Provides testing or validation of decisions being
made by the team.
Provides data collection and reporting.
Participates in the communication, education,
implementation, and evaluation of the project.
Gathers input from the areas they represent, if
appropriate.
Shares team decisions and plans throughout the
project.
May work directly with Stakeholders or Subject
Matter Experts.
Subject Matter Expert
Not a core team member of the team.
Participates in demonstrations/presentations and/
or team meetings, as needed.
Carries out project activities as assigned; pro-
duces deliverables.
Responsible for supplying requirements.
Provides input to the team or complete activities
based on a specific expertise he or she possesses
that is essential to the project.
Source: TriHealth.
Chapter 4 Organizational Capability: Structure, Culture, and Roles 133
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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

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Endnotes
1. Chandler, Dawne, and Payson Hall. Improving Exec-
utive Sponsorship of Projects: A Holistic Approach
(New York, NY: Business Expert Press, 2016).
2. PMI Lexicon of Project Terms, 2015, 4.
3. http://www.whizlabs.com/blog/projectized-orga-
nization/, accessed February 7, 2017.
4. http://project-management-knowledge.com/defi-
nitions/c/co-location/, accessed February 7, 2017.
5. http://project-management-knowledge.com/defi-
nitions/m/matrix-organization/, accessed Febru-
ary 7, 2017.
6. Johnson, Craig E., Meeting the Ethical Challenges
of Leadership: Casting Light or Shadow, 3rd ed.
(Thousand Oaks, CA: Sage Publications, Inc.,
2009): 89.
7. Aronson, Zvi H., Aaron J. Shenhar, and Peerasit
Patanakul, Managing the Intangible Aspects of a
Project: The Affect of Vision, Artifacts, and
Leader Values on Project Spirit and Success in
Technology-Driven Projects, Project Manage-
ment Journal (February 2013): 51.
8. Adapted from Erling S. Andersen, Understand
Your Project s Character, Project Management
Journal (December 2003): 4 11; and Ramon J.
Aldag and Loren W. Kuzuhara, Mastering Man-
agement Skills (Mason, OH: Thomson South-
Western, 2005).
9. Adapted from Erling S. Andersen, Understand
Your Project s Character, Project Management
Journal (December 2003): 4 11.
10. Collyer, Simon, Culture, Communication, and
Leadership for Projects in Dynamic Environ-
ments, Project Management Journal (Decem-
ber/January 2017): 111.
11. PM1 Code of Ethics and Professional Conduct,
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January 23, 2017.
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town Square, PA: Project Management Institute,
2011): 134.
13. Chandler, Dawne E., and Payson Hall, Improving
Executive Sponsorship of Projects: A Holistic Approach
(New York: Business Expert Press, 2017): 1.
14. Chandler, Dawne E., and Janice L. Thomas,
Does Executive Sponsorship Matter for Realiz-
ing Project Management Value? Project Man-
agement Journal (October/November 2015): 47.
15. Kloppenborg, Timothy J., and Debbie Tesch,
How Executive Sponsors Influence Project Suc-
cess, MIT Sloan Management Review (Spring
2015): 28 29.
16. Chandler, Dawne E., and Payson Hall, Improving
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Organizational Project Management in the Chi-
nese Context, Project Management Journal (Feb-
ruary/March 2016): 121.
Chapter 4 Organizational Capability: Structure, Culture, and Roles 135
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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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C H A P T E R 5
Leading and Managing Project Teams
Gallup Consulting is a global research-based consultancy, specializing in
employee and customer management. Our goal is to take discoveries in behav-
ioral economics and apply them to management and business problems. Every
organization has an enormous, but largely untapped, potential for breakthrough
improvements in productivity through leveraging how human nature drives busi-
ness performance. This unrealized potential can be measured and managed to
improve performance.
Our consulting work is managed as a series of projects. At the start of each
client engagement, project leaders gather the high-level information required to
identify the client s problems and possible remedies, while understanding any
constraints that will affect project success over the long term. The resulting
project charter is a business case for the project and a description of how
Gallup will add value to the client s organization. Codifying these commitments
also helps in enumerating the roles and responsibilities of the project team
members.
w
av
eb
re
ak
m
ed
ia
/S
hu
tte
rs
to
ck
.c
om
CHAPTER OBJECTIVES
After completing this
chapter, you should
be able to:
CORE OBJECTIVES:
Describe stages of
team development
and strategies to
move teams through
the project life cycle.
Describe characteris-
tics of a high-
performing project
team; assess your
individual and team
capability; and
describe how your
team can improve.
Describe methods of
project team decision
making and the circum-
stances in which each is
likelytobemosteffective.
BEHAVIORAL OBJECTIVES:
Explainhowtoutilize the
project team relation-
shipandprocessground
rules to improve it.
Describe types of
project manager
power and when
each is appropriate.
Describe typical
sources of project
conflict along with the
steps in a conflict-
resolution process,
styles of handling
conflict, and steps in
a negotiation process.
Summarize how
to develop high-
performance
traditional and
virtual teams.
136
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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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Staffing a team is critical to project success. Our research shows that there
are three keys to being an effective project leader:
1. Knowing and investing in your own strengths and the strengths of your project
team.
2. Getting people with the right talents on your team.
3. Satisfying the four basic needs of those who follow your leadership: trust,
compassion, stability, and hope.
By strength, I mean an ability to provide consistent, near-perfect perfor-
mance in a specific activity. The first step to building strength is to identify your
greatest talents the ways in which you most naturally think, feel, or behave.
Strengths are created when your naturally powerful talents are combined with
learnable skills, such as how to put together a project budget. Gallup has studied
more than 6 million people, and we have found that individuals have much more
potential for growth and productivity in areas of great talent than areas of
weakness.
A strengths-based approach improves team cohesion and generates better
results. We have found that high-performing teams are more likely to match indi-
viduals talents to assigned tasks and emphasize individual strengths versus
seniority in making personnel decisions. High-performing teams also have lea-
ders who meet the needs of trust, compassion, hope, and stability.
We have found that while each team member has his or her own unique
strengths, the most successful and cohesive teams possess a broader array of
strengths. A tool like the Clifton StrengthsFinder® is useful for helping team
members identify the ways they can best contribute to the team s goals. Our
research shows that the 34 StrengthsFinder themes naturally cluster into these
four groups:
1. Executing making things happen
2. Influencing reaching a broader audience
3. Relationship building holding the team together
4. Strategic thinking focusing on all the possibilities
The student website describes these strengths from a project management
perspective and tells you how to discover your own unique strengths.
Jim Asplund, Gallup Consulting
9.2 Estimate
Activity
Resources
9.3 Acquire Resources
9.6 Control
Resources9.1 Plan Resource
Management
RACI
Team Charter
Resource
Requirements
9.4 Develop Team
9.5 Manage Team
Team Assignments
Team Assessments
4.2 Develop Project
Management Plan
PMBOK® GUIDE
Topics:
Acquire project team
Develop project team
Manage project team
CHAPTER OUTPUTS
Team charter
Resource
requirements
Team assignments
Team assessments
137
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An experienced project manager envisions project performance as two related activi-ties. First, people must perform their roles in completing work activities according
to the plan. Performance by people is the topic of this chapter. Second, data must be
collected and used to determine the project progress and results. Data collection and
determining project progress as measured in schedule, cost, quality, and risk terms are
the subject of Chapter 14. While determining progress and results is conducted largely
in parallel with people performing the project, the two are covered in separate chapters
to emphasize exactly what needs to be done in each.
“Management is the attainment of organizational goals in an effective and efficient
manner through planning, organizing, leading, and controlling organizational
resources.”1 Chapters 7 to 15 of this book deal primarily with planning, organizing, and
executing the project. This chapter deals mostly with managing and leading project
teams. While certain aspects of both management and leadership are necessary in deal-
ing with project teams, in the contemporary approach to projects, the project manager
works collaboratively with the project team to the extent possible while continually push-
ing to reach project goals. “Leadership is the influencing process of leaders and followers
to achieve organizational objectives through change.”2
To further elaborate on the focus of this chapter, management is generally focused on
traditional functions such as planning, organizing, and controlling. In this chapter, man-
agement is concerned with making decisions and working in teams to improve opera-
tional efficiency and effectiveness. Leadership, on the other hand, is about providing
direction, motivating, and guiding people and teams to realize their potential and achieve
challenging organizational goals.
This chapter starts with acquiring the project team up to the point that team mem-
bers have been successfully brought on board to the project. The second section deals
with various activities needed to develop the project team’s capability—many of which
require leadership from the project manager. The third section includes several consid-
erations for the project manager when managing the performance of the project team.
The fourth section covers how to develop effective relationships within the core project
team. The fifth section presents issues about conflict and resolution that occur when
dealing with both team members and stakeholders. Finally, the concluding section details
actions to develop virtual teams.
5-1 Acquire Project Team
Acquire project team is “the process of confirming human resource availability and
obtaining the team necessary to complete project assignments.”3 Chances are the core
team has already been assembled, as it is very helpful to have the core team together for
planning—and even earlier, for chartering a project. However, on some projects, some
core team members may be added later. Also, on many large projects, subject matter
experts (SMEs) may be added during the early stages. This section deals with the timing
of assigning a project team member (preassignment), securing the needed and desired
team members (negotiation), and successfully adding them to the project team (on-
boarding).
It is not necessary for the project manager to always have an opportunity to select the
project team members. However, she is still responsible for their performance. Likewise,
in certain organizational settings, the project manager may not have total authority over
the team member, but she still is accountable for all individuals’ and the team’s
performances.
138 Part 2 Leading Projects
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5-1a Preassignment of Project Team Members
Generally, it is helpful for a project to assign both core team members and SMEs as early
as possible for various reasons. One reason is that people often do not like to be told
what they must do, but are usually enthusiastic if they get a chance to help in creating
a project plan. Therefore, it is good for motivational purposes to include the implemen-
ters in planning. A second reason is that when the people who will perform the work
help to plan it, many more details may be considered and the resulting plans are often
more realistic. Yet another reason to assign project team members early is to be sure they
will be dedicated and be available when needed. For external projects, it is a common
practice to list specific workers who will be assigned to a project team in the proposal,
and occasionally they must be approved by the client. If the project is secured, it is help-
ful to bring the workers onto the project as quickly as possible.
The downside to bringing SMEs on board before they need to complete project activ-
ities is that it could be expensive. For a highly paid expert, this decision can be substan-
tial and impractical. Another problem with bringing people on board early is that they
may first be committed to finishing work on a previous project and may not devote the
necessary attention to the new project. Regardless of how early you bring a person on a
project, it is helpful to keep communications open with the prospective team member
and his or her boss so they understand when the person is needed. This is especially
critical if the project has a tight deadline and/or if the organization is using critical
chain project management.
5-1b Negotiation for Project Team Members
Depending on the norms of the organization, a project manager may need to negotiate
with the functional manager and/or a prospective team member directly to secure his or
her services for a project. The functional manager (perhaps called a department head or
line manager) has the responsibility of running his or her department. For example, the
head of accounting is responsible for how the accounting function is performed. She
wants to keep all of her workers busy, but not too busy, and wants all of her workers
to progress in their capability.
The functional manager may see this project as a good opportunity for some on-
the-job training to help a newer employee gain experience. The project manager, on the
other hand, wants the “best” resource for his or her project. The best resource may
already be busy. Wise project managers often develop good relationships with functional
managers to have leverage in negotiating for a good worker. Functional and project man-
agers may look at the situation from the perspective of the department or project, respec-
tively, and have different ideas of who is the appropriate person to work on the project.
A project manager cannot expect to have the best resource from every department
(unless perhaps the project is the highest priority project for the company). The func-
tional manager may sometimes need to agree to a different resource from what he or
she prefers. In short, most projects have a combination of experienced and inexperienced
resources. If a project manager finds all functional managers are only offering inexperi-
enced people, he should probably ask his sponsor for support.
In many organizations, project managers also need to persuade workers to work on
their project. For experienced project managers, reputation goes a long way. A project
manager can earn a reputation of being a good boss by caring for team members, help-
ing people develop, and assisting them in securing interesting work and promotions at
the end of a project. It is important to align individual aspirations and goals with project
goals to get the best results from everyone on the project team.
Chapter 5 Leading and Managing Project Teams 139
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Many employees campaign hard to work for a great project manager and avoid a
poor project manager. When negotiating with a potential team member, a project man-
ager wants to sell the project to the person. Of course, strong technical skills are impor-
tant for SMEs and are helpful for core team members. However, especially for core team
members, it may be more critical to be an excellent generalist and skilled at communica-
tion and making decisions. Many core team members need to deal with a variety of
issues beyond their discipline and focus on making trade-offs that key stakeholders
demand.
Sometimes, it is necessary to recruit project team members from outside of the parent
organization. Tatro, Inc., uses this strategy, as described in Exhibit 5.1.
5-1c On-Boarding Project Team Members
The ideal time to bring team members and even a few SMEs on board, is when the proj-
ect charter is being written. When that is not possible, the first thing a project manager
might do is share the charter and the meeting minutes with the new member and then
have a one-on-one discussion with that person. There are several purposes for this dis-
cussion. The first is to ensure that the new person understands the project at a high level
and is enthusiastic about being part of it. The second is to learn about the person’s per-
sonal and professional aspirations. The most effective and happy workers are those who
understand how their personal goals and project goals are aligned. Does he or she want
to experience the joy of working on something new, travel, training, new coworkers,
and so on? What unique strengths does he or she already bring to the project, and
what strengths does he or she want to further develop? At this point, the project man-
ager can accomplish the third purpose of the talk, which is to assign the new team mem-
ber to specific activities and develop a plan for personal improvement. Exhibit 5.2
illustrates how one consulting company that has many projects acquires and on-boards
resources.
EXHIBIT 5.1
TATRO, INC., STRATEGY FOR RECRUITING PROJECT TEAM MEMBERS
Tatro, Inc., is a designer and builder of high-end landscape projects. Its strategy is to retain its core
strengths of securing contracts, designing exceptional landscapes, and managing projects with
demanding clients. It subcontracts most other work, but wants to be very careful that the work is
done as well as possible. Tatro understands it needs to have self-motivated workers who are very
presentable to discriminating clients. Tatro primarily relies on recommendations to identify potential
workers. To screen potential workers, Tatro performs extensive background checks. It examines pre-
vious work performed by the worker, talks to previous clients, and attempts to ensure the worker’s
finances will allow him or her to be stable.
At that point, it attempts to recruit these proven workers. Chris Tetrault, president of Tatro, Inc.,
states that he uses a combination of four strategies to recruit, as follows:
1. Pay well.
2. Pay quickly.
3. Provide signature projects for the workers to showcase their skills.
4. Try to get them to like me.
Source: Chris Tetrault, President, Tatro, Inc. Reprinted with permission.
140 Part 2 Leading Projects
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5-2 Develop Project Team
Develop project team is “the process of improving the competencies, team member
interaction, and overall team environment to enhance project performance.”4 Developing
a highly effective project team requires the following six activities from the project man-
ager. Note these six activities build upon each other and are overlapping.
5-2.1.1 Understand stages of project team development.
5-2.1.2 Understand characteristics of high-performing project teams.
5-2.1.3 Assess individual member capability.
5-2.1.4 Assess project team capability.
5-2.1.5 Build both individual and team capability.
5-2.1.6 Establish team ground rules (team charter).
EXHIBIT 5.2
ACQUIRING AND ON-BOARDING RESOURCES AT ATOS-ORIGIN
Resources are the most important assets of a consulting company. It becomes very important to
nurture them, utilize them effectively, and at the same time make money for the company. At
Atos-Origin (a leading IT consulting company), a structured process is followed to manage
resources. Resource skills, credentials, and travel preferences; the business unit to which the
resource belongs; a summary of projects worked on; and so forth are maintained in a searchable
database. Utilization (amount of time a resource is used on projects) is tracked on at least a weekly
basis. Resource availability (amount of time each resource is idle or is available for client projects)
is also tracked and published to a large group of managers to keep in mind for upcoming
assignments.
A central resource manager is responsible for tracking and managing resource utilization. If
any member of the management team has an open requirement, the resource manager is first
notified of the requirement, so that work can begin on tracking the right person for the role.
Resource managers from each business unit meet regularly to discuss staff availability and open
positions.
Weekly meetings are held with senior management teams to understand the open staffing require-
ments. As a first fit, internal available resources are aligned (based on the skills required, time frame
of the project, and whether the role aligns with a person’s career preferences) with open positions.
Since Atos-Origin is a global organization, this helps the company to increase utilization of the indi-
vidual resource and of the group as a whole. If existing resources are not available or do not fit into
the assignment, a requisition to hire new resources is completed, and the job is posted for
recruitment.
Atos-Origin considers three different types of external hires: full-time employees (the preferred
option), hourly employees (work on an hourly basis; the option used when the project is for a
short period of time or when the right resource does not want to accept a full-time offer), and
subcontractors (contracting with other companies; the option used sometimes to mitigate resource
risks).
The new resource who is hired is on-boarded to the company in a structured fashion, and the same
process for managing the person’s utilization and availability is followed. This structured process has
helped reduce attrition, increased internal transfer of resources, helped individual resource growth,
and increased the company’s profitability.
Source: Rachana Thariani, PMP, Atos-Origin.
Chapter 5 Leading and Managing Project Teams 141
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5-2a Stages of Project Team Development
Project teams typically go through a predictable set of stages as they work together. By
effectively using project tools and developing trust and understanding within their teams,
project managers can greatly diminish some of the negative aspects of project team
development stages. While almost all teams go through these stages, the duration of
each stage varies for each team, based on various factors such as familiarity among the
team members, corporate culture, uncertainties and unknowns associated with the proj-
ect, and the urgency of the project. Consequently, some teams get “stalled” in an early
stage and do not progress. Some get further along and then have a setback. Setbacks for
project teams can also come from losing or gaining core team members or SMEs,
changes in project requirements, quality problems with project deliverables, or other rea-
sons. The good news for a team that suffers a setback is that because they worked
through the team development stages once, they can probably work through the stages
more quickly the second time. The bad news is that they do need to work their way
through.
Each stage of team development has its own challenges. For a project manager to suc-
cessfully help a team develop, he or she should be aware of how team members feel and
what behaviors they frequently attempt at each stage. People have a tendency to be
friendly with people who have similar values, while differences are often seen as a threat
that may affect collaboration and lead to undesirable attitudes and behaviors. This
behavioral issue presents challenges in managing teams, specifically global project
teams, where diversity and cultural differences are the norm.
Exhibit 5.3 presents information about behavioral characteristics of the team during
each stage of team development and ideas for managing them.
In learning about and using some of the project management tools that are described
throughout this book, one can implement quite a few of the strategies for team
EXHIBIT 5.3
• Low familiarity among the team
• Individual roles not clear
• Emphasis on collective goals
• Interdependence of members
• Manage differences and conflict
• Focus on consensus-building
• High mutual trust
• High commitment
• Self-managed team
• Participation & empowerment
• Commitment to team goals
• Roles and Responsibilities
1.
Forming
2.
Storming
4.
Performing
3.
Norming
Source: Anantatmula, Vittal, Project Teams: A Structured Development Approach, Business Expert Press, 2016: 12.
142 Part 2 Leading Projects
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development. For example, when a team works together to create a good charter, they
rapidly work through the project-forming stage and often begin to develop the openness,
understanding, and trust that help make their storming stage faster and easier. Informa-
tion regarding the issues, behaviors, and strategies associated with each stage is displayed
in Exhibit 5.4.
Understanding the stages of development that project teams typically progress
through is a basis for project goal attainment and project team development. For exam-
ple, if a project manager of a new team wants to help his or her team progress through
the stages without too much trouble, he or she can look at the top and bottom rows of
Exhibit 5.4. New members often feel a combination of excitement about being picked for
the new team and concern that the work may be difficult. The project manager can help
the new team develop team-operating methods early—when they construct the project
charter. Having the team decide how they will work together helps establish workable
methods and simultaneously helps the team members start to know and trust each
EXHIBIT 5.4
PROJECT TEAM PROGRESSION THROUGH DEVELOPMENT STAGES
FORMING STORMING NORMING PERFORMING ADJOURNING
Team member
relationship
issues
Feel excitement, yet
skepticism
Feel resistance, yet
longing to commit
to project
Feel part of team
and believe project
will succeed
Feel close to
teammates and
understand
teammates
Feel strong attach-
ment to team and
feel loss when team
disbands
Team members
attempt to
Understand expec-
tations, activities
needed, and power
structures
Jockey for power,
ask many ques-
tions, and estab-
lish dubious goals
Accept team mem-
bers, hold open
discussions, and es-
tablish team norms
Improve self, pre-
vent and solve
problems, and ex-
pand beyond offi-
cial role
Complete project on
high note, maintain
relationships with
teammates, and seek
next challenge
PM strategies to
promote
organization
needs
Develop business
case and acceptance
criteria in charter
Develop stake-
holder analysis,
communication
plan, budget, and
quality plan
Manage trade-offs
per stakeholder de-
sires, include spon-
sor in talks, and
conduct audit
Share applied
learnings with or-
ganization and
report progress to
stakeholders
Secure customer
acceptance of deli-
verables, honestly
appraise team
members, and pro-
vide ongoing sup-
port to users
PM strategies to
promote project
needs
Develop scope
overview, milestone
schedule, risks, and
learnings in charter
Develop scope
statement, WBS,
schedule, and risk
register
Add SMEs as need-
ed, authorize work,
and improve work
processes
Monitor and con-
trol project ac-
cording to plan
and update plans
as needed
Test project deli-
verables and secure
team member en-
dorsement of them
PM strategies to
promote team
member needs
Develop team op-
erating methods
and commitment in
charter, and help
members build
relationships
Clarify each
member’s role,
encourage all to
participate, and
determine team
ground rules
Personalize each
member’s role, col-
laborate when pos-
sible, and assess and
build members and
team capability
Capture applied
learnings and im-
prove meeting
and time
management
Celebrate success,
reward team mem-
bers, and help team
members secure
follow-on work
Source: Adapted from Barbara J. Streibel, Peter R. Sholtes, and Brian L. Joiner, The Team Handbook, 3rd ed. (Madison, WI: Oriel Incorporated, 2005): 6–8.
Chapter 5 Leading and Managing Project Teams 143
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other. Once the initial forming is over, it is common for teams to “storm”—that is, to
feel more stress as they begin to understand how big and difficult the project appears
upon closer scrutiny. Some of the team members may want to participate in the project
performance yet may resist committing fully. The project manager may work with the
team to help ensure that everyone understands and accepts their respective roles. Fur-
ther, when each team member understands the other members’ roles, they can see how
the project will be accomplished. The project manager can continue to encourage all
team members to actively participate and to refine the team operating methods into
ground rules if necessary.
Once a project team weathers the storming period, the members often are relieved
because they start to believe they will be successful. Continued team building can help a
team to refine its ability to perform. As team members are encouraged to collaborate and
build capability, the team moves to a higher level, which is often called the performing
stage. Not every team reaches this level. However, it is very satisfying for the teams that
do because the team members realize and increase their potential. Also, this level is a
valuable milestone at which lessons learned can be realized and used to help improve
other project teams. Finally, project teams disband when the project is over. If the proj-
ect has been successful, team members often feel both excited about facing new chal-
lenges and sad about leaving a satisfying experience and good friends. Project managers
should use celebration, rewards, and appropriate follow-on work to guide the team
through this last stretch.
5-2b Characteristics of High-Performing Project Teams
Once a project manager understands the typical stages of team development, it is time to
understand the characteristics of high-performing project teams. These characteristics,
which are an elaborate expansion of the performing column in Exhibit 5.4, reflect the
ideals toward which a project manager tries to guide his or her team.
Teams eager to become high performing often create and use a team charter to
enhance their effectiveness. A team charter presents information about how members
are expected to collaborate in the activities of the project and participate in making deci-
sions. Specifically, team members work in concert with one another. The team charter
also specifies professional performance and the personal behavior of the team members
to achieve harmony, teamwork, team spirit, and dedication.
Developing a team charter promotes collaboration and synergy among the team
members and leads to better team performance. The team charter describes group
norms, which are either written or unwritten rules that dictate behaviors and expecta-
tions of the team members. The charter guides team members regarding work ethics,
honesty, integrity, respect, conflict management, decision making, and communication
protocols. It is preferred for a project team to develop a team charter to improve its per-
formance by defining norms for common understanding and agreement, as shown in
Exhibit 5.5.
This chain of high-performing project team characteristics is shown in Exhibit 5.6.
Remember, this is the ideal. Many project teams perform well and exhibit some, but
not all, of these characteristics. Nevertheless, a conscientious project manager keeps
these characteristics in mind and strives to help his team develop each one.
The characteristics of high-performing project teams start with the personal values of
individual team members. While a project manager can and should strive to improve
upon these values, it is far easier if team members are recruited with a good start on
the following values:
144 Part 2 Leading Projects
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High need for achievement
Understanding and acceptance of personal responsibility
Commitment to self-development and self-directed behavior
Ability to put project needs before their own needs within reason
Willingness to consider alternative views and to change
Personal commitment to the project
EXHIBIT 5.5
PROJECT TEAM CHARTER
• Reporting/Processes
• Elemental Data Reporting
• Responsibilities and Assignments
• Set Consequences of Nonconformance
• Timeliness (Attendance as Well as Delivery)
• Work Hours
• Time Spent
• Obligations
• Reporting
• Deliverables
• Knowledge Sharing
• Tracking (Plan vs. Actual)
• Civility
• Meeting Protocols
• Social Graces
• Decision Protocol
• Receiving/Offering Assistance
• Cooperative Stance
• Honest Communication
• Conflict Recognition
• Negotiations
• Teamwork
• Demeanor
• Communication
• Conflict management
• Negotiation
• Trust
• Team Spirit
• Harmony
• Cohesiveness
• Rare major conflicts
• Commitment
Source: Anantatmula, Vittal, Project Teams: A Structured Development Approach, Business Expert Press, 2016:
136–139.
EXHIBIT 5.6
CHARACTERISTICS OF HIGH-PERFORMING PROJECT TEAMS
Personal
Rewards
Project
Results
Feelings for
Each Other
Personal
Values
Behavior
Methods
Communication
Methods
Project
Methods
Chapter 5 Leading and Managing Project Teams 145
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AGILE
The personal values can be enhanced by utilizing the following effective team behav-
ior methods:
Team members are selected to represent the right skill mix.
Team members help each other.
Team members demonstrate a constant focus on improvement.
Team members use effective time management, including for meetings.
Team members strive for innovation with few formal procedures.
Team members capture, share, and use lessons learned.
The personal values can be further improved by practicing the following beneficial
communications methods:
Information is freely and widely shared within and beyond the team.
All important topics are openly discussed.
Conflict over approaches is valued, but personal conflict is discouraged.
Potential problems are proactively reported.
Teams conduct frequent debriefings and reflect to collectively learn.
Barriers to communication are overcome.
Project managers can certainly use some of the following project management meth-
ods to further the team development:
Agree on common goals and objectives for the project.
Jointly plan the project.
Use the charter to guide joint decision making.
Work together to accomplish activities.
Proactively identify and solve problems.
Hold each other mutually accountable with individualized feedback.
Using effective team, communications, and project management methods leads to
development of the following appropriate feelings that team members can begin to hold
toward one another:
Recognizing how interdependent they are
Being flexible on how each contributes to the project
Being willing to share risks with teammates and having tolerance for minor mistakes
Understanding, appreciating, liking, and trusting each other
Sharing in strong project leadership
This chain leads to two favorable outcomes. The first set of outcomes is personal
rewards that each team member is likely to receive such as the following:
Enjoyment of their work
High spirit and team morale
Pride in being part of the team
Satisfaction in project accomplishments
The other set of favorable outcomes includes the following strong project results:
Persevering despite challenges
Producing high-quality results
Consistently meeting or exceeding stakeholder expectations.5
In addition to these characteristics, agile teams are often described as being self-
managed, focused on project goals, strong communicators, able to decide quickly, more
146 Part 2 Leading Projects
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responsible, and willing to trust their instincts once they understand their sponsor. The
result is that these team members are more satisfied, flexible, and accommodating.
Traditional projects use distributed work teams and more specialists and adopt a
process-oriented approach. On the other hand, teams on agile project typically employ
co-located teams to manage rapid changes and increments. However, agile teams can
be in multiple locations. Further, agile teams require motivated members with a higher
level of commitment. Agile teams have these seven desirable traits:
Question everything
Focus on innovation
Fail their way to success
Communicate thoughts and ideas
Deliver value
Change incrementally
Connect with their purpose6
The Agile project team members are also responsible for regularly checking for devia-
tions and should be capable of detecting aspects of the project that violate the
specifications.
5-2c Assessing Individual Member Capability
Synergy results in a team having a collective capability that exceeds the sum of individual
capabilities. Conversely, if team synergy is absent, the collective capability would fall
short of individual capabilities put together. More often than not, individual team mem-
bers with high capability can effectively be developed into a strong team. So, what capa-
bilities should project team members possess? Five types of useful project team member
capabilities are as follows:
1. Activity-specific knowledge and skills
2. Personal planning and control
3. Personal learning
4. Organizational understanding
5. Interpersonal skills and sensitivity
The first three capabilities are necessary for a person to be a strong individual per-
former, and the last two capabilities help a person become a valuable team player.
While all five are useful, if a project manager wants to develop a strong project team,
the last two capabilities may be more important. Too many teams have not achieved
the expected success because team members were content with their individual
performance.
The first type is activity-specific capability. If a team member is responsible for a spe-
cific function such as managing the construction of a stone wall, he or she should under-
stand in detail what needs to be accomplished to create a desirable stone wall. If she will
personally build the wall, she also needs the skills to do so. A second desirable capability
is personal planning and control, for example, setting personal goals, accomplishing
work as planned, and managing time wisely. Regarding the third capability, project
team members should desire to continually improve and invest effort in their personal
improvement. Learning should never stop.
The fourth useful capability is understanding the organizational structure, culture, and
roles and using that knowledge to support the project manager in accomplishing project
activities. This involves knowing the informal methods and networks within the parent
organization. If the project is being performed for a client, it can also include knowing
Chapter 5 Leading and Managing Project Teams 147
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how things work within the client’s organization. The last useful team member capability
is interpersonal skills and sensitivity. This includes skills such as active listening, effective
speaking, and conflict management. It also includes possessing emotional intelligence
and having sensitivity toward others who have different personalities or backgrounds.
5-2d Assessing Project Team Capability
When assessing project team capability, the project manager should remember that his
or her responsibilities are to simultaneously support the parent organization, the project,
and the project team. These three are intertwined in many ways. While much has been
written concerning teams, Exhibit 5.7 summarizes the success factors of project teams.
Note the related chapter number and specific topic where this book gives guidance to
help achieve each success factor. Many practices of good project management (and
good organizational management) help a project team to excel, just as many team suc-
cess factors help a project team deliver desired project and organizational results.
For example, the project charter covered in Chapter 3 is helpful in achieving many of
the project team success factors. The entire project charter is a basis for more detailed
project planning and for understanding project objectives. Working together to develop,
sign, and distribute the charter greatly aids in communications and commitment. Spe-
cific sections of the charter also help teams develop successfully as they realize shared
goals and challenges. The team operating methods section helps guide team member
behaviors as they resolve conflicts, the applied learnings help create a stimulating work
environment, and the acceptance criteria help team members understand when they sat-
isfy project stakeholders.
Following is a brief description of why each project team success factor listed in
Exhibit 5.7 is useful:
1. Project teams with strong leadership are more likely to be successful. Leadership can
occur at every level within a project team. Each member performs better by under-
standing both his or her own role and those of all the other executives, managers,
and associates that are part of the team. Part of project team leadership is the project
culture nurtured by the sponsor and project manager.
2. Effective team leadership can lead to mutual trust, respect, and credibility among all
parties.
3. This, in turn, can lead to the cross-functional cooperation and support that help guide
a project through turbulent situations.
4–5. Project managers have many project tools to guide a team—charters, stakeholder
analysis, communications plans, scope statements, WBSs, schedules, and kickoff
meetings. Collectively, they help to create clarity and active support for the project.
It is difficult to overestimate the impact that effective communication has on proj-
ect teams. When people are not given information, they must guess. Proactive proj-
ect managers realize that developing and implementing an effective two-way
communication plan is a major key to their teams’ success.
6–8. The next three project team success factors—skills, objectives, and behaviors—apply
specifically to the team. Assembling the right blend of skills and experience for the
project team can be quite challenging. This is especially true in the current work
environment of cost-control measures. One option for project managers is to staff the
project with a combination of experienced and inexperienced members because it
often costs less to include an inexperienced person in the project team. An expectation
148 Part 2 Leading Projects
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EXHIBIT 5.7
PROJECT TEAM SUCCESS FACTORS
PROJECT TEAM SUCCESS FACTORS CPM CHAPTER TOPIC
1 Team leadership in setting direction and project
culture
4 Project management roles, organization, and project
cultures
2 Mutual trust, respect, and credibility among team
members and leaders
4 Project management roles
6 Build relationships
5 Develop project team
3 Cross-functional cooperation, communication,
and support
3 Project charter
6 Communications planning
4 Clear project plans created by team and sup-
ported by organization
3 Project charter
6 Stakeholder analysis
7 Scope and WBS
8 Activity schedule
12 Kick off project
5 Effective communications including feedback on
performance
6 Communications planning
6 Information distribution
14 Report progress
15 Secure customer acceptance
6 Team skills and experience appropriate and
adequate
9 Resource projects
5 Acquire and develop project team
14 Manage overloads and resolve resource conflicts
7 Clearly defined and pursued project and team
objectives
3 Project charter
14 Direct and manage project execution
8 Use of task and relationship behaviors to resolve
conflicts and problems
3 Team operating methods
6 Build relationships, meeting management
11 Risk planning
9 Stimulating work environment with opportu-
nities for improvement and learning
3 Applied learnings
14 Process improvement
15 Capture and share applied learnings
10 Opportunity for team and personal recognition
when project satisfies stakeholders
3 Acceptance criteria
15 Celebrate success
Source: Adapted from Hans J. Thamhain, “Team Leadership Effectiveness in Technology-Based Project Environments,” Project Management Journal 35 (4)
(December 2004): 38–39; and Roy C. Herrenkohl, Becoming a Team: Achieving a Goal (Mason, OH: Thomson South-Western, 2004): 9, 25.
Chapter 5 Leading and Managing Project Teams 149
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can be set for the more experienced person to mentor the junior person. This pro-
motes organizational learning as well as achieving the project’s goals at a lower cost.
Many project teams include a section in their charter on team operating methods.
This section often spells out methods of decision making, meeting management, and
demonstrating professionalism. While working through staffing decisions, an astute
project manager may recognize people in two categories: task oriented or people ori-
ented (relations). Both types are necessary, and the project manager will have to man-
age a balance by developing or recruiting team members.
9–10. When the first eight project team success factors are adequately accomplished, the
last two are often realized. These last two—stimulating work and opportunity for
recognition—have shown the strongest correlation to successful project performance
as perceived by senior managers.6 People work hard and enthusiastically if they find
their work stimulating and believe they will be rewarded for it. Appropriate and sin-
cere recognition can often be at least as powerful a motivation as monetary rewards.
Project managers can use their creativity to reward all who merit it.
All 10 of these project team success factors can be influenced by a project manager.
Many of the success factors require some early work, such as the project charter, and
some require continuing work as the project progresses. A new project manager can
ask questions to determine to what extent his project team currently displays each of
these success factors. Then he will be ready to build the team’s capacity upon this base.
5-2e Building Individual and Project Team Capability
Project managers have many tools at their disposal for developing individuals and teams.
Many of the methods can be used together and reinforce each other. Seven methods that
many project managers find useful are as follows:
1. Demonstrate personal leadership.
2. Utilize project management tools.
3. Demand situational leadership.
4. Create a desirable team identity.
5. Teach personal responsibility.
6. Develop understanding and respect.
7. Use a learning cycle.
PERSONAL LEADERSHIP A good way for project managers to build the capability of
their team is to start by being an effective leader. An effective leader creates and shares a
strong vision for the project. Leading by example gives team members a model to follow.
A project manager leads by balancing the demands of the parent organization, the project,
and the team members. In this context, the project manager is a team member—but one
who treats herself and all the other team members in a respectful manner. The project
manager must use the highest levels of honesty and ethics. This includes never stating any-
thing that is false, but also not giving any false impressions. This can cause a bit of extra
work or conflict in the short term, but it is the only appropriate behavior and pays great
dividends in the long run by encouraging (and even demanding) everyone else to do what
is right. Transparency in communication and action and aligning both are critical and will
set an example for the rest of the team and instill trust among all team members.
PROJECT MANAGEMENT TOOLS Project managers can use project management
tools to develop focus and cohesion among team members. For example, the charter
150 Part 2 Leading Projects
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helps a team to start quickly and collectively. The WBS, schedule, and other project
management tools each help to focus the team in explicit ways. Specifically, the WBS is
the best tool for project integration and assimilation of the project team to work toward
specific goals and shared outcomes.
SITUATIONAL LEADERSHIP Depending on the team’s initial capability, a project
manager may need to start as a strong individual leader, but the goal is to develop mul-
tiple leaders on the project team. In fact, in a great project team, leadership is situational;
that is, each member may have a leadership role in certain circumstances and follower
roles in other situations. In areas in which a junior team member has specific knowledge,
he or she should ensure that everyone understands the situation. Even a junior team
member is often expected to lead in certain situations. Furthermore, during the initial
stages of team development, the project manager assumes the roles of directing and
monitoring team activities, but those change to supporting and facilitating roles once
the team moves to the performing stage.
DESIRABLE TEAM IDENTITY Another way to build team capacity is to create a desir-
able team identity. Frequently, the project manager and sponsor start thinking about this
even before they recruit the first team members. People want to be associated with a win-
ner. If people believe that a project is vital to the organization and that the work is profes-
sionally stimulating, they want to be part of the team. Depending on the organization,
some teams give detailed thought to the project name and “brand.” Military organizations
and sports teams often do well in developing and maintaining team identity by associating
themselves with pride and prestige. Uniforms demonstrate this identity externally.
RESPONSIBILITY Project team members need to understand they all have three
responsibilities. The first is to complete their individual work on time, on budget, and
correctly as specified in the WBS dictionary. Second, they must complete their joint
work responsibilities with teammates on time, on budget, and according to the plan.
Third, each team member is responsible for improving work methods. Everyone needs
to improve his or her personal work and work with the team to jointly improve the proj-
ect team’s capabilities.
UNDERSTANDING AND RESPECT Project team members need to develop under-
standing and trust in each other to develop team capability. Understanding other team
members starts with understanding oneself. A self-aware individual is more effective in
establishing relationships by better appreciating and valuing the contributions of others
and being willing to learn from them. One method of understanding both oneself and
others better is to use StrengthsFinder and to realize how each individual strength can be
productively applied on projects, as shown on the student website. As team members
understand one another and develop interdependence, they are naturally able to under-
stand and develop interdependence beyond the project team. Since most projects have
multiple stakeholders, this ability to connect at many levels is vital to team development.
LEARNING CYCLE Building project team capability can be envisioned as a learning
cycle in which the team uses creativity to jointly develop and consider alternative
approaches while striving to learn at each point in the process. This learning cycle can
be easily understood using the plan-do-check-act (PDCA) model. The project team capa-
bility building cycle is shown in Exhibit 5.8.
Project team capacity building is performed in the context of planning and executing
project work. Project teams can pass through this capability-building cycle repeatedly as
Chapter 5 Leading and Managing Project Teams 151
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they progressively learn how to work better together to reach their project goals. Free
and open communications along with a willingness to challenge each other are impor-
tant because the project team may need to unlearn or give up past behaviors in favor
of new approaches that might be more effective.
In the “plan” step, project teams are challenged with using lessons learned from previ-
ous projects to drive their improvement efforts. These lessons need to be compared to the
emerging requirements for the project that the team learns from methods such as gather-
ing requirements, meeting with customers, brainstorming risks, and holding design
reviews. Further, historical data from Earned Value Management (EVM) of previously exe-
cuted projects, which provide actual and realistic data, can improve accuracy of cost and
time estimates of the current project, specifically for similar or identical WBS elements.
In the “do” step, the project team then uses this knowledge to develop shared mean-
ing and potential approaches that they may use. The team uncovers assumptions, brain-
storms alternative approaches, and often develops rolling wave plans so the results of
early work will give the information needed to create good plans for later work.
In the “check” step, the project team evaluates the potential approaches and selects
one. They can use techniques such as piloting new technology, creating a subject matter
expert panel for recommendations, conducting feasibility studies, and reviewing the
problem with key stakeholders to obtain a clear decision.
In the “act” step, the project team finishes the planning, carries it out, and gathers
data regarding it. This data can be verified with the planned data for continuous
improvement of the planning process of scope, cost, and time. Simultaneously, the team
seeks acceptance beyond their team through articulating the project’s business case,
involving key stakeholders, proactively communicating according to plans, and not act-
ing until enough support is in place.
The cycle then repeats. Project teams that are serious about improving their capability
repeat this cycle quickly within project stages, at key milestones, and from project to
EXHIBIT 5.8
PROJECT TEAM CAPABILITY BUILDING CYCLE
Use lessons from
previous projects to drive
learning
Develop shared
meaning and approaches
Evaluate approaches
and select desired approach
Enact approach and gain
broader commitment
P
DC
A
Source: Adapted from Peter Senge, Richard Ross, Bryan Smith, Charlotte Roberts, and Art Kleiner, The Fifth Disci-
pline Fieldbook: Strategies and Tools for Building a Learning Organization (New York: Doubleday, 1994): 59–63.
152 Part 2 Leading Projects
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project. The improved capacity of one project team can be shared with other projects
through lessons learned and sharing core team members and SMEs with other projects.
5-2f Establishing Project Team Ground Rules
Project teams often create a brief set of operating principles in their charter as described
in Chapter 3. For small teams performing simple projects, these principles are enough to
guide their behavior. This is especially true if the company has a track record of success
with teams. However, many managers understand that more specific ground rules can
help prevent many potential problems that some project teams encounter. Ground rules
are acceptable behaviors adopted by a project team to improve working relationships,
effectiveness, and communication. Therefore, many times, the simple set of operating
principles is expanded into a broader set of ground rules.
Exhibit 5.9 lists a dozen of the most frequent topics that project teams choose to create
ground rules to cover. Note the topics are classified as either dealing primarily with pro-
cess issues or primarily with relationship issues. Note also that there is more than one way
to implement each ground rule. Also listed in Exhibit 5.9 are two strengths from the stu-
dent website that might be used in very different ways to accomplish each ground rule—
and other strengths could be applied as well—each in its own unique manner.
RELATIONSHIP TOPICS The relationship topics both help the team make better deci-
sions and help project team members feel valued. People who feel valued often work
with much more enthusiasm and commitment.
Encourage Participation The first relationship topic is to encourage balanced partici-
pation. This balance can include drawing out an introverted person and asking a
Select team members with a variety of strengths to ensure balanced participation.
m
oo
db
oa
rd
/A
la
m
y
St
oc
k
Ph
ot
o
Chapter 5 Leading and Managing Project Teams 153
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talkative person to let another individual speak. Balance can mean ensuring that all func-
tions are given the opportunity to provide input. Balanced participation can also mean
sharing leadership roles. The project manager certainly needs to be a leader, but each
project team member can provide leadership in certain situations.
Discuss Openly and Protect Confidentiality The second relationship topic is to
encourage open discussion. When some topics are off limits for discussion, sometimes
important issues are not raised, and poor decisions are made. Closely related to open dis-
cussion is the issue of protecting confidentiality. People should have trust that a sensitive
issue will not be repeated outside of the project team. It is hard to work effectively together
if team members are concerned that important issues could be shared inappropriately.
Avoid Misunderstandings Since projects are often staffed by people from different
functions and even different companies, there is a strong potential for misunderstand-
ings. Both the person stating something and the person listening have a responsibility
to avoid potential misunderstandings. Many active listening techniques are useful for
this purpose, such as summarizing what was said, asking the listener to restate what
was conveyed, or asking for an example.
Develop Trust The fifth relationship topic is to develop trust. Each project team member
has two responsibilities to establish trust. First, one should always be worthy of the trust of
his or her teammates. This means accomplishing work as promised, communicating trans-
parently, and being completely truthful always. Part of being truthful may be expressing in
advance a concern about the ability to do certain work due to reasons such as skills, knowl-
edge, or time constraints. The second responsibility is to trust his or her teammates unless
and until one proves unworthy of trust. Many people live up to the expectations of others.
EXHIBIT 5.9
A DOZEN GROUND RULE TOPICS FOR PROJECT TEAMS
RELATIONSHIP TOPICS PROCESS TOPICS
1. Encourage participation.
Consistency
Includer
1. Manage meetings.
Achiever
Discipline
2. Discuss openly.
Communication
Intellection
2. Establish roles.
Arranger
Individualization
3. Protect confidentiality.
Deliberative
Relator
3. Maintain focus.
Command
Focus
4. Avoid misunderstandings.
Connectedness
Harmony
4. Consider alternatives.
Analytical
Strategic
5. Develop trust.
Belief
Responsibility
5. Use data.
Context
Input
6. Handle conflict.
Adaptability
Empathy
6. Make decisions.
Activator
Restorative
154 Part 2 Leading Projects
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By practicing the highest ethical standards and expecting the same from other team mem-
bers, a project manager can expect most team members to demonstrate their trustworthi-
ness. That does not mean that you trust an inexperienced person naively to figure out how
to perform a complex task independently. Common sense must be exercised in assigning
work and determining the level of support required for everyone in the team.
Handle Conflict The final relationship ground rule topic is how to handle conflict. Con-
flict can bring out creative discussion and lead to better methods and solutions if the conflict
is confined to a technical or task issue. However, conflict that becomes personal can be
destructive and demotivating. Therefore, conflict over ideas is often encouraged (up to a
point), while personal conflict is often settled by the concerned individuals off the project.
The project manager may get involved and/or may bring in a neutral third party if necessary
to resolve people-related conflicts. Conflict management is covered later in this chapter.
PROCESS TOPICS Process topics include how a project team works together as they
gather data, meet, and make important project decisions.
Manage Meetings The process topic regarding meeting management is introduced in
Chapter 6 in the context of improving and documenting meetings. Special applications
of meeting management are covered in Chapter 12 for kickoff meetings and Chapter 14
for progress reporting meetings.
Establish Roles The second process topic is to establish roles. People are usually
assigned to a project team in the role of project manager, core team member, or subject
matter expert. Within the team, however, it is often helpful to assign roles regarding
items such as who plans a meeting, who watches the time, and who records the minutes.
One important principle with these role assignments is to try to help everyone feel val-
ued. A person who is constantly assigned to perform unpleasant tasks may not feel as
important or as motivated to contribute. Another part of assigning roles is to assign
tasks to project team members between meetings. Each worker is then responsible for
completing their assignments and to report if these assignments are not completed as
planned. However, it is good practice to follow up with the members between meetings
to ensure that project tasks are completed as planned.
Maintain Focus Project managers and the team are often under pressure to complete
the project below the budget and ahead of schedule. Therefore, project managers need to
ensure that the team stays focused. A periodic review of actual progress using the project
plan and project documents to resolve disagreements regarding decisions can help
greatly. The project charter and the plan remind the team what they are trying to accom-
plish and why. Another means of maintaining focus is referring to the stakeholder anal-
ysis and the trade-off decisions that the key stakeholders have indicated. The key with
focus is to spend the most time and energy on important issues and to delegate, post-
pone, or ignore less important issues.
Consider Alternatives The fourth process-oriented ground rule topic is to always con-
sider at least two alternative approaches before proceeding. It is amazing how many project
teams simply agree with the first suggestion that someone makes. A team that invests as little
as a couple of minutes of time can ensure that they have considered alternative approaches.
Quite often, a much better idea emerges from a second or third suggestion than from the
first one. Also, many times a project team decides to combine the better parts of two alter-
natives. This consideration of alternatives not only often yields a better approach, but it also
often results in better commitment because more people’s ideas were considered.
Chapter 5 Leading and Managing Project Teams 155
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For example, in a project to install a suite of equipment at a customer’s site, a final
site investigation revealed that a major piece of equipment was not functional. One
answer was to expedite the shipment of a duplicate piece of equipment, while a compet-
ing alternative was to use overtime labor and consultants to refurbish the onsite equip-
ment. Both alternatives were expensive, and neither looked very promising. However,
upon further discussion, it was determined that one section of the equipment was the
primary concern, so a new section could be airfreighted in and the workers onsite
could install it. This hybrid alternative proved to be far less expensive and more practical
than either alternative that the panicked team first considered.
Use Data The fifth process-oriented ground rule topic is to always use data when pos-
sible. Gather the facts instead of arguing over opinions. In meetings, make the data visi-
ble to everyone on the team so that all can use it to help make informed decisions. It is
possible that a team will generate more alternatives if the data is presented in meetings
because it promotes constructive discussions and synergy. Many of the quality tools
listed in Exhibit 14.9 help the project team to gather, organize, prioritize, and analyze
data for making informed decisions.
Make Decisions The final process-related topic is decision making. Project decisions
can be made in several different ways. Adherence to the other ground rule topics will
help regardless of which decision-making method is chosen. Methods that project
teams often use to make decisions include the following:
The project manager or sponsor makes the decision.
One or two team members recommend or make the decision.
The project team uses consensus to make the decision.
The project team votes to make the decision.
On some issues, the project sponsor or project manager retains the right to make a
decision. Sometimes, this is because a decision needs to be made quickly or it takes higher
authority. A sponsor or project manager may also ask for input from the team and then
make the decision. While this is often a good idea, that person should be very careful to
tell the team up front that he or she still intends to make the decision. Otherwise, the team
members who provided input may feel that their ideas were not considered.
Project managers may choose to delegate a decision to one or two team members—
either members of the core team or SMEs. This strategy works well when not enough
information or time is available at the current meeting and the decision needs to be
made before the following meeting. Decisions that primarily impact one or two members
rather than the entire project team are ripe for delegation. Delegating to two team mem-
bers has the secondary benefit of their getting to know each other better and working
well together for the rest of the project duration. A variation on this delegation strategy
is to ask one or two team members to investigate and recommend a solution on which
the team can decide at the next meeting. Over the course of a project, most team mem-
bers will probably get the chance to make certain decisions.
Consensus is wonderful, but reaching it requires a time-consuming technique. True consen-
sus means each person actively supports the decision—even if it is not his or her first choice.
The team tells stakeholders that after discussion they understand the decision that was made is
the best one for the project. To reach this true consensus, each person needs to be able to artic-
ulate what he or she believes is important in the decision and why. Creative approaches may
need to be developed when none of the original ideas pleases everyone. Consensus is helpful
when significant commitment is necessary to implement the decision. Consensus also might
involve cultural issues, so it is important to include everyone in making decisions.
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One final method that project teams might use to make decisions is to vote. This is
often a poor choice since the losers of the vote may not be very enthusiastic and may not
support implementation of the choice wholeheartedly. Another method may be better
than standard voting. A straw vote—that is, a test for agreement—is a method by
which a team may take a nonbinding vote. If most of the team agrees, then it may not
take long to drive toward consensus. If many members do not agree, then delaying the
decision, gathering more data, or agreeing to let one person make the decision may be in
order.
5-3 Manage Project Team
Manage project team is “the process of tracking team member performance, providing
feedback, resolving issues, and coordinating changes to optimize project performance.”7
When managing the project team, a project manager uses various forms of power to get
team members to prioritize and commit to project work. Project managers are often
called upon to either assess members’ performance or to at least provide input for the
performance assessments.
5-3a Project Manager Power and Leadership
Since project managers often rely on people who do not report directly to them to perform
some of the project work, they need to use various forms of power to encourage people to
perform. Types of power available to project managers are shown in Exhibit 5.10.
EXHIBIT 5.10
TYPES OF PROJECT MANAGER POWER
TYPE OF POWER BRIEF DESCRIPTION WHEN USED
Legitimate Formal authority based upon
user’s position
Asking people to perform within their
job description
Reward Persuading others based upon
giving them something
If team members perform well and if
negotiating for resources
Coercive Punishing others for not
performing
Only when needed to maintain disci-
pline or enforce rules
Referent Persuading others based upon
personal relationship
Frequent since project managers often
lack legitimate power based upon
position
Expert Persuading others based upon
your own knowledge and skills
When others respect your opinions
Information Control of information Frequent, as a large part of a project
manager’s role is to convey information
Connection Informal based upon user’s
relationships with influential
people
When working with project sponsors
and when negotiating for resources
Source: Adapted from Robert N. Lussier and Christopher F. Achua, Leadership: Theory, Application, Skill Develop-
ment, 4th ed. Mason, OH: South-Western Cengage Learning, 2010: 110–117.
Chapter 5 Leading and Managing Project Teams 157
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LEGITIMATE POWER Project managers often may not have authority over the project
team members, although they are responsible and accountable for their performance.
Therefore, project managers often have less legitimate power than other managers. How-
ever, to the extent that project managers can ask team members to perform certain activ-
ities, they should do so. In contemporary project management, a project manager often
has a core team to help plan and manage major parts of the project. These core team
members are probably the people the project manager can instruct to perform certain
activities, but he or she would be better served when it is possible to ask them to plan the
activities. The old axiom is true: people tend to support the things they helped to create.
REWARD AND COERCIVE POWER Reward and coercive power are opposites of each
other. Not all rewards cost money. In fact, stimulating work is one of the most powerful
rewards. Enticing people to perform well so they can be assigned to more interesting
and/or challenging work helps the team member, the immediate project, and the organi-
zation. While reward power is the preferred method, there are times when a person is
not performing and a threat, or coercion, may be necessary. This is especially true if
most members of the project team are performing and one or two members are not.
People who work hard value teammates who also work hard and are often upset when
some members do not contribute their share.
REFERENT POWER Referent power is when a project team member works for the proj-
ect manager out of personal desire. Project managers sow the seeds for referent power
when interviewing candidates for their project team. If the project manager takes the
time to understand the personal motives of each team member, he or she can create desir-
able opportunities for each. Individual project managers who remember the adage “no one
loves your project as much as you do” use their referent power by continuing to describe
their project’s purpose in ways that appeal to each individual worker’s desires. Many suc-
cessful project managers work hard to develop both friendships and respect with their
team members. Loyalty must go both ways. If a team member believes a project manager
has his or her best interests at heart and will advocate for him or her, then that team mem-
ber is more likely to demonstrate loyalty to the project manager by working hard.
EXPERT POWER Generally, people want to succeed in whatever they do. Project man-
agers can tap into this desire by using expert power. If a project manager has a reputa-
tion for success and can convince others that he or she understands enough of the
project management technology and politics to successfully guide the project, then peo-
ple will be more inclined to work hard on the project. They will be convinced that their
efforts will pay off and that they will have a chance to learn and grow professionally.
INFORMATION POWER Information power is something that project managers want
to use, but not in a coercive manner. While information is power, withholding or dis-
torting information is unethical. A project manager’s responsibility is to ensure that
whoever needs certain information receives it in a timely manner, in a form they can
understand, and with complete honesty and accuracy. That does not mean sharing con-
fidential information inappropriately. It does mean empowering the core team to distrib-
ute information promptly and accurately according to the communication plan. This
gives the core team more knowledge power.
CONNECTION POWER The very reason for having executives sponsor projects is
because the sponsor frequently has more legitimate power than the project manager. Project
managers can use the power of the sponsor when necessary. A project manager who
158 Part 2 Leading Projects
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frequently asks the sponsor to intervene looks weak. On the other hand, a project manager
who does not ask for the sponsor’s help when it is really needed lacks judgment. Project
managers can create many champions for their project by continuing to expand their con-
tacts with important people and by continuing to talk about the importance of their project.
5-3b Assessing Performance of Individuals and Project Teams
The second aspect of managing project teams is assessing the performance of both indi-
viduals and the project team. Goals of performance assessments include administrative
uses such as rewards and promotions and professional development such as determining
areas for improvement and training. In many organizations, a large percentage of people
dread performance assessments. Many people do not enjoy giving honest feedback—
particularly about shortcomings. Also, many people do not like to receive constructive
feedback. However, for both reward purposes and to improve performance, honest
assessments are needed. Performance assessment can be both informal and formal. Proj-
ect managers often perform informal assessments by observing, asking questions, and
providing suggestions. This improves performance if it is done regularly, as timely and
specific feedback is most effective.
Formal performance assessments are often the primary responsibility of the manager
toward people who directly report to him. In many organizations, this is a functional man-
ager. However, because many project team members spend significant time on a project, the
project manager is often asked to provide input for the formal performance assessment. The
ideal situation for this input is when the team member helped participate in the project plan-
ning and is judged by how his or her work corresponds to the planned work. Many project
team members may work on several projects during the formal assessment period. When
that is the case, the projects where they spent the greatest time would ideally count the
most toward their performance rating. On some large projects, a project manager may seek
input from other team members regarding the team member’s performance.
5-3c Project Team Management Outcomes
A variety of outcomes may result from managing the project team, such as the following:
Morale changes
”Quarter-mile stones” to “inch stones”
Staff changes
Training needs
Discipline
Role clarification
Issues
Lessons learned
MORALE CHANGES Many projects have periods that are difficult, when work demands
are high and milestones to celebrate are few. During these times, the project manager
needs to remember that the way he or she wields power, communicates, appraises prog-
ress, and generally manages can enhance or detract from the morale of all involved. Con-
tinuing to reinforce the project’s purpose, encouraging and supporting workers, and trying
hard to understand their concerns can go a long way toward boosting morale.
QUARTER-MILE STONES TO INCH STONES When constructing the project charter,
the team developed a list of milestones that could be used to measure progress. On some
projects, that is enough detail against which performance can be measured. On other
Chapter 5 Leading and Managing Project Teams 159
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projects, however, more details are needed. Perhaps these greater details could be consid-
ered “quarter-mile stones”—giving the ability to check progress more frequently. When
assessing the performance of individual workers, if one individual worker consistently
does not perform well, the project manager may decide that more detailed oversight is
necessary. This could result in “yard, foot, or inch stones,” depending on the level of
oversight deemed necessary. Hopefully, for most projects and most workers, this addi-
tional oversight will not be necessary. It takes time and effort that could be spent on
other productive activities. However, a wise project manager is not going to let a project
get derailed because of one worker who is not performing well.
STAFF CHANGES Poor appraisals, insufficient progress, conflict, necessary reassign-
ments, or other causes may warrant staff changes on a project. When this occurs, wise
project managers treat everyone with respect and recognize that changes are happening.
When new people are added, they are given a formal introduction to the team and pro-
vided information about the project.
TRAINING NEEDS In the course of performance appraisals, training needs are some-
times identified. Project managers should keep the immediate project needs along with
the training needs in mind as they approve training.
DISCIPLINE Performance on some projects is so poor that employees need to be disci-
plined. While coercive power is often considered a last resort, it should be used at times. Proj-
ect managers must ensure that prior warnings of poor performance are issued to a struggling
team member so that person has an opportunity to make amends. Specific behaviors or lack of
progress are documented, the need for the discipline is explained clearly, and specific improve-
ment strategies are developed to reduce the chance that further discipline will be needed.
ROLE CLARIFICATION Sometimes, progress may be lacking because of misunder-
standings in responsibilities or miscommunication. In those cases, the project manager
can clarify roles of all impacted employees by detailing their roles in completing WBS
tasks, responsibilities toward other team members and the project, and what is expected
of them in terms of project tasks and professional behavior.
ISSUES AND LESSONS LEARNED Many project managers keep issue logs. These
serve as living documents of issues that arise while managing the project and the project
team. As issues are raised, they are added to the log, and once they are resolved, they are
deleted. The resolved issues sometimes make good lessons learned if they can help future
project teams avoid similar problems. These lessons can be documented and stored for
easy retrieval in a lessons-learned knowledge base.
5-4 Relationship Building Within the Core Team
Project sponsors and managers who wish to create highly productive workplaces ensure
that core team members understand what is expected of them, have the chance to do
work they are well suited to perform, receive appropriate recognition, have good cowor-
kers, have their opinions considered, and have opportunities to grow and develop.8 The
sponsor and the project manager ideally begin by asking one another about personal
expectations regarding the project and project goals such as specific capabilities of the
project deliverables. Both the project manager and sponsor may have individual motives
also. It is helpful to disclose and acknowledge these personal goals to each other.
The project manager, in turn, asks each core team member what he or she personally
wants from being involved in the project. These conversations not only help the project
160 Part 2 Leading Projects
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manager understand priorities but also understand motivations. For example, core team
members may want to participate in a stimulating experience, gain new skills, or earn a
promotion. Understanding these motivations will make it easier for the project manager
to address them. Aligning individual aspirations with project goals in determining indi-
vidual roles and responsibilities is desirable and productive.
The project manager can encourage open and transparent communication such as
keeping people informed, demonstrating that everyone’s input is valued, personally shar-
ing feelings, and respecting confidentiality. She should set the expectation that all team
members practice these habits.
Joint establishment of project meeting agendas helps in building relations because all
team members feel their concerns are addressed, and they develop a greater sense of
ownership in meetings. When members get to share in meaningful project learning,
they feel their insight is valued. Frequent celebration of small successes helps project
team members share the enjoyment of working on a project, which in turn helps them
stay committed to successful project completion.
One other key relationship-building activity that needs to start early and continue
throughout the project is concerned with appropriate decision making and problem solv-
ing. The project manager and core team need to understand who makes each type of
project decision and how those decisions are made. One consideration is that people
involved in making decisions tend to support them. Decisions made by groups tend to
take longer, and projects are often pushed for time. Some decisions are best made by a
single expert, while others are best made by a group that represents various points of
view. Each project team will need to determine who will make which types of decisions.
Exhibit 5.11 gives general advice that can be applied in making this determination.
5-5 Managing Project Conflicts
Projects create unique outputs, work with diverse stakeholders, are represented by team
members from various functions and even different companies, and frequently operate in
a matrix environment. These factors, along with scope, time, and cost constraints, con-
tribute to potential conflicts. Many project management initiating and planning tools
exist to reduce destructive aspects of conflict, at least partly. This section discusses differ-
ent ways to view conflict, along with various styles and approaches for dealing with it.
This section also introduces a project conflict-resolution process model.
In dealing with task-related conflicts, project charters are meant to help the project core
team, project manager, and sponsor understand many aspects of the project at a high level
and head off potential conflict between individuals. Several components included in charters,
EXHIBIT 5.11
PROJECT DECISION-MAKING GUIDE
PERSON/METHOD WHEN
Sponsor decides
Project manager decides
Functional manager decides
Core team discusses and project manager decides
Core team consensus
Delegated to one or two team members to recommend
Delegated to one or two team members to decide
Critical decision, large monetary stake, “big picture” needed
Time is critical, no need for other input
“How” functional work is done
Team input is useful
Buy-in is critical
Needs to be investigated, team input useful
Needs to be investigated, team input not needed
Chapter 5 Leading and Managing Project Teams 161
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for example, assumptions, risks, roles, responsibilities, and acceptance criteria are examples
of potential sources of conflict. Stakeholder analysis and communications planning can iden-
tify needs and desires of many others who will be impacted by either the process of perform-
ing the project or a deliverable of the project. These tools help to identify and deal with
potential sources of conflict among the broader stakeholders. The more-detailed planning
tools such as the WBS, schedule, and budget help to identify other conflict sources.
People-related conflicts can be effectively addressed by developing a team charter, as
discussed in Section 5-2b of this chapter. Everyone comes with unique experience,
knowledge, IQ, and personality type and these differences can be a source of conflict. A
team charter helps to define norms, attitudinal preferences, work ethics, and responsibil-
ities for all team members. Adherence to team charter elements promotes mutual under-
standing and conflict resolution.
5-5a Sources of Project Conflict
Some conflicts on projects are useful; other conflicts can be destructive. Conflict over ideas
on how to proceed with a project can lead to more creative approaches. Conflict over how
to complete a project with a tight schedule can also be positive. Competition for ideas on
how to best handle a project activity has the potential for generating more innovative and
successful approaches and can be highly stimulating work. However, when conflict
becomes personal, it can often become negative. These types of conflict need to be handled
with care. A few typical sources of project conflict are shown in Exhibit 5.12. Generally, it
is better to deal with conflict on projects promptly—or even proactively. Conflicts do not
get better with time! This is especially true for projects with significant pressure to stay on
schedule or on budget (in other words, many projects).
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162 Part 2 Leading Projects
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Virtually all studies have determined that relationship conflict can be detrimental to project
team success. When people spend time and emotional energy arguing, they have less energy
to work on the project. Also, when people have personal conflicts to the point where they
really do not like each other, they often feel less committed to the project and to their team.
Task conflict is a bit more complicated. A certain amount of task conflict can encour-
age people to consider alternative approaches and to better justify decisions. Up to that
point, task conflict can be useful. However, beyond a certain point, when people spend a
great deal of time arguing over task-type issues, conflict takes away from the project team’s
progress and camaraderie. The timing of task conflict can also make a difference on
whether it helps or hurts the project. The best times to discuss different options are during
the initiating stage, when high-level approaches are being decided, and during the plan-
ning stage, when more detailed decisions are being made. However, once the plans are
made, a project team needs to be a bit more careful because prolonged discussions during
the executing periods of the project can lead to schedule slippage and cost overruns.
In general, conflict occurs due to incompatible goals and differences in thoughts or
emotions among the team members. It is a common experience with any team or a
group of highly skilled and exceptionally creative individuals to interpret facts and events
differently. The project manager must capitalize on this intellectual diversity using effec-
tive communication techniques and debates to identify the most appropriate resolution.
5-5b Conflict-Resolution Process and Styles
Once a project manager recognizes that a conflict exists, if it is a task conflict, he or she
tries to utilize it to develop a better solution. If it is a relationship conflict, he or she tries
to resolve it before it escalates. A project manager can use the six-step project conflict-
resolution process, making sure to pay attention both to the tasks and relationships
needed at each step.
Six-Step Project Conflict-Resolution Process
1. Understand the conflict.
2. Agree on conflict-resolution goals.
3. Identify causes of the conflict.
4. Identify potential solutions for the conflict.
5. Pick the desired conflict solution.
6. Implement the chosen solution.
First, the project manager and the team investigate the situation: What are the signs of the
conflict? Is it specific to a certain stage in the project? Does each party in the conflict
EXHIBIT 5.12
TYPICAL SOURCES OF PROJECT CONFLICT
RELATIONSHIP SOURCES TASK SOURCES
Roles and responsibilities
Lack of commitment
Communications failure
Different personalities
Stakeholder relationships
Personal motives of participants
Energy and motivation
Next project assignment
Individual rewards
Stakeholder expectations
Unique project demands
Money and other resources
Technical approach
Priorities
Differing goals of stakeholders
Task interdependencies
Schedule
Risks
Chapter 5 Leading and Managing Project Teams 163
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understand it the same way? If not, they need to ask clarifying questions, summarize how the
other person has stated the problem, and confirm that they have a common understanding.
Next, ensure that all parties agree on what a successful conflict resolution would be. While
there are often conflicting goals on projects, all stakeholders typically want useful deliverables
on time and on budget. Use the project goals as a basis for what the solution needs to cover.
Many conflicts have multiple causes, such as those shown in Exhibit 5.12. Identify
potential causes and then verify which cause(s) are contributing to the conflict.
The next step is to identify potential solutions to the conflict. This is clearly a time
where creativity and mutual trust are helpful. It is important to focus on the conflict
issue and not the person. Also, potential solutions should be considered based on their
value and should not be evaluated based on the person who suggests a solution.
The fifth step is deciding how to resolve the conflict. There are five general styles for
resolving project conflict, as depicted in Exhibit 5.13.
The collaborative style is preferred for important decisions that require both parties to
actively support the final decision. However, collaboration requires both parties to
develop trust in each other and, therefore, often takes longer than the other styles.
Therefore, each style in 5.13 has its value in dealing with project conflicts.
The final step is to implement the chosen solution. For a major conflict, this could be
almost like a mini-project plan with activities identified and responsibility assigned. It is
vital to include communication of the solution to all concerned parties.
5-5c Negotiation
Negotiation is about redefining an old relationship that is not working effectively or
establishing a new relationship.9 Negotiation is the most commonly used process and
the first step to resolve a dispute, a difference, or a conflict.
Project managers are generally held accountable for more performance issues than
they have responsibility to direct people to perform. Because of this, project managers
must negotiate. As stated earlier in this chapter, they often need to negotiate with func-
tional managers for the people they wish to have on the project team. Project managers
EXHIBIT 5.13
STYLES OF HANDLING PROJECT CONFLICT
STYLE
CONCERN
FOR SELF
CONCERN FOR
OTHERS WHEN APPROPRIATE FOR PROJECTS
Forcing/
Competing
High Low Only when quick decision is necessary, we are sure we are right, and
buy-in from others is not needed
Withdrawing/
Avoiding
Low Low Only when conflict is minor, there is no chance to win, or it is
helpful to secure needed information or let tempers cool
Smoothing/
Accommodating
Low High Only when we know we are wrong, it is more important to other
party, or we are after something bigger later
Compromising Medium Medium Only when an agreement is unlikely, both sides have equal power,
and each is willing to get part of what they want without taking
more time
Collaborating/
Problem Solving
High High Whenever there is enough time, trust can be established, the issue is
important to both sides, and buy-in is needed
Source: Adapted from Richard L. Daft, Management, 9th ed. (Mason, OH: Southwestern Cengage Learning, 2010): 519–520; Ramon J. Aldag and Loren
W. Kuzuhara, Mastering Management Skills: A Manager s Toolkit (Mason, OH: Thomson South-Western, 2005): 416–419; and PMBOK® Guide 240.
164 Part 2 Leading Projects
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often need to negotiate with customers and other key stakeholders concerning schedule,
budget, scope, and a myriad of details. They also often need to negotiate with sponsors,
suppliers, SMEs, and core team members.
Nobody is as committed to or involved with a project as much as the project man-
ager. However, a project manager must remember that negotiations will be smoother if
she realizes that everyone she negotiates with has their own set of issues and goals.
Many of the project management tools discussed thus far in this book, such as char-
ters, stakeholder analysis, communication plans, schedules, budgets, and change control,
make negotiations easier. Several of the soft skills discussed in this book, such as involv-
ing your team in planning, treating everyone with respect, keeping communications
open, and establishing trust, also simplify negotiations. The issues project managers
need to negotiate can greatly vary in size and complexity. For example, many small
issues can involve day-to-day scheduling issues. On the other hand, the entire set of proj-
ect deliverables with accompanying schedule and budget are often negotiated.
Regardless of the negotiation size or complexity, the six-step process shown in Exhibit
5.14 can serve as a guide.
The negotiation process is based on the project manager and the other party attempting
in good faith to reach a solution that benefits both—in other words, a win-win solution.
Project managers need to be vigilant, however, because not everyone they must negotiate
with takes that same attitude. Smart project managers recognize that their reputation is
based on how they act in all situations. Therefore, even when negotiating against someone
who plays hardball, it is still wise to stay ethical and keep emotions in check.
Step 1 involves advance fact-finding to determine what is needed from the negotia-
tion. This may include checking with the sponsor and/or other stakeholders and deter-
mining the impact that various settlements may have on the project. It also includes
seeking to understand both what the other party is likely to want and how he or she
may act during the negotiations.
Step 2 is for the project manager to understand the bottom line. What is the minimum
acceptable result? Just as when buying a car, a project manager needs to understand when to
walk away. This can vary a great deal depending on how much power each party has. Project
EXHIBIT 5.14
NEGOTIATION PROCESS
STEP EXPLANATION
1. Prepare for negotiation Know what you want and who you will negotiate with.
2. Know your walk-away point Determine in advance the minimum you need from the
negotiation.
3. Clarify both parties’ interests Learn what the other party really wants and share your true
interests to determine a common goal.
4. Consider multiple options Brainstorm multiple approaches—even approaches that only
solve part of the issue.
5. Work toward a common goal Keep the common goal in mind: seek and share information,
make concessions, and search for possible settlements.
6. Clarify and confirm agreements Agree on key points, summarize, and record all agreements.
Source: Adapted from Ramon J. Aldag and Loren W. Kuzuhara, Mastering Management Skills: A Manager s Toolkit
(Mason, OH: Thomson South-Western, 2005): 129–132; and Timothy T. Baldwin, William H. Bommer, and Robert
S. Rubin, Developing Management Skills: What Great Managers Know and Do (Boston: McGraw-Hill, 2008): 307–318.
Chapter 5 Leading and Managing Project Teams 165
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managers need to understand that if they have the power and take advantage of their nego-
tiation partner, that partner may not work with them on a future project. Therefore, the goal
is not to always drive the hardest bargain, but to drive a fair bargain. It is worth mentioning
that if one party has more power than the other party, even if it is only a perception, negoti-
ation may not be the right option until the inequality issue is addressed.
Step 3 is for the project manager to understand the underlying needs of the other party
and to share his or her own needs. This is not a 10-second political sound bite that says,
“Take it or leave it.” This is developing a real understanding of each other’s needs.
Step 4 is to create multiple options. This is easy once both parties understand what
the other party really needs because various creative solutions can then be developed
that help to satisfy those underlying needs.
Step 5 consists of the process and strategies of the negotiation itself. It is helpful to
keep in mind the ultimate goal while focusing on the many details of information shar-
ing, trading of concessions, and exploring possible solutions.
Step 6 is actually a reminder to reach an agreement and then to document that agree-
ment. A consultant friend of mine often says: we have reached a violent agreement” when
people essentially have agreed, but keep talking. Clarify and document your agreement.
5-6 Communication Needs of Global and
Virtual Teams
As organizations change more rapidly, more projects are conducted with member from
various parts of the larger organization, various organizations, and even various parts of
the world. These teams draw from a wider pool of talent, but can pose added challenges.
5-6a Virtual Teams
In contemporary project management, project managers use less-onerous command and
control than they might have a few years ago. This trend is even more pronounced with
global and virtual teams. A virtual team is also sometimes known as a distributed team.
They rarely meet in person, but rely on communications technology. When project
teams operate in a virtual mode, many of the following characteristics are present:
Team members are physically dispersed.
Time boundaries are crossed.
Communication technologies are used.
Cultural, organizational, age, gender, and functional diversity are present.10
5-6b Cultural Differences
Cultural patterns differ in various parts of the world, so project team members need to
be more sensitive as to how their actions are interpreted. For example, in some cultures,
making eye contact signifies that you are paying close attention. In other parts of the
world, however, eye contact is considered rude; in these cultures, people may look
slightly downward in deference to authority. When people do not have face-to-face con-
tact, they do not have the opportunity to see and learn from a person’s body language.
Project managers working with global and virtual project teams need to be especially
mindful of the increased need for communications using methods other than face to
face. Reading comprehension and listening skills are valuable for virtual teams.
Cultural differences make communication challenges more difficult. The various meth-
ods regarding charter development described in Chapter 4, along with stakeholder analysis
and communications planning in this chapter, are even more critical on virtual and global
166 Part 2 Leading Projects
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teams partially due to cultural differences. The more unusual a team is, the more critical
charters and communications vehicles become. Exhibit 5.15 lists some of the extra com-
munications challenges posed by virtual and global project teams. Note that each project
management need has a specific and increased challenge—for example, the third need,
relationship building, needs more time since people do not have the advantage of full
face-to-face communication. Project managers and teams can enhance stakeholder satis-
faction by learning the cultural ethics and values of all their stakeholders, working hard
to establish trust, and ensuring that they use fast and reliable information systems.
5-6c Countries and Project Communication Preferences
It is helpful if the project team members can meet each other face to face, even one time.
While this can be expensive, it may be much less expensive than poor performance on
the project. Sometimes, the core project team is assembled to write and approve the proj-
ect charter. The core team members then get to know each other and are inclined to give
each other the benefit of doubt in case of any misunderstandings. Another method that
is frequently used is to confirm meetings and calls with quick meeting minutes or e-mail
follow-ups. By documenting any decisions, it is easier to remember what happened and
to uncover lessons learned when the project is complete.
While abundant differences exist among people from various countries, the method
and timing of project communications are of interest here. For example, Ralf Mueller
and J. Rodney Turner studied how cultural differences impact preferred modes of project
management communication.11 They examined how collectivism versus individualism,
along with the extent individuals in various cultures accept unequal power and ambigu-
ity, impact project communications preferences. The results show that country prefer-
ences can be shown in four categories with common preferences on frequency and type
of communications for each group.
PMP/CAPM Study Ideas
While PMI absolutely recognizes the importance of the “soft skills” regarding management
and communication, you shouldn’t expect to see many—if any—questions directly from the
lists in this chapter. Rather, you will be expected to understand the best practices we describe
and to apply them to mock situations. One type of question you will see in many guises has
to do with change requests. Whether a customer, sponsor, or team member requests a
change, if you have already completed your project management plan, any change must go
through a change request process. In other words, it may be your natural instinct to want to
EXHIBIT 5.15
INCREASED CHALLENGES FOR VIRTUAL AND GLOBAL PROJECT TEAM
PROJECT MANAGEMENT NEED INCREASED CHALLENGES
1. Initiate project 1. More unique project needs
2. Understand stakeholders 2. More difficult to understand
3. Build relationships 3. Needs more time
4. Determine communications needs and methods 4. More unique needs, more reliance on electronic means
5. Establish change control 5. More facilitating than directing
6. Manage the meeting process 6. Less nonverbal clues, interest may wander
7. Control issues 7. With less group interaction, harder to identify
Chapter 5 Leading and Managing Project Teams 167
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please the person making the request—especially if the change seems small—but the best
practice/correct answer will always be to go through the change control process (more infor-
mation on this is provided in Chapters 7 and 14).
Other test questions you may see from this chapter include the stages of team
development—forming, storming, norming, performing, and adjourning—and both cap-
turing and utilizing lessons learned.
Summary
While the project core team is ideally assembled early in
the project to participate in chartering and planning the
project, SMEs are commonly assigned as needed. Project
managers try to secure the services of these important
people as early in the project as possible. This often
involves negotiating with the functional managers to
whom the SMEs report. When new project team mem-
bers arrive, they need to be on-boarded; that is, they need
to understand the project and start to develop working
relationships with their new team members. Experienced
project managers ensure that the new members under-
stand project goals but also share their personal goals so
that both can simultaneously be achieved.
Teams progress through typical stages of develop-
ment. High-performing project teams share a number
of characteristics. Project managers can use understand-
ing of these stages and characteristics to guide their team
to better performance. They do this by assessing indi-
vidual and team capabilities and developing strategies to
improve both. The project team often develops team
operating principles in the charter. Many teams expand
upon these with more specific team ground rules. The
ground rules are tailored to the unique needs of the
project situation, but generally include both rules for
improving relationships among team members as well
as improving the process of how the team works.
The project manager must manage the human side of
his project. This involves utilizing appropriate forms of
power in managing the project team to obtain desired
results. Project teams also need to manage and control
stakeholder engagements through understanding their
expectations, delivering on those expectations, and com-
municating effectively. Projects are ripe for many kinds
of conflict. Constructive conflict over ideas often yields
better approaches, but destructive conflict that gets per-
sonal needs to be headed off when possible and dealt
with when it occurs. Many good project management
practices and techniques are helpful in channeling con-
flict in constructive directions. Project managers also
need to utilize many general conflict reduction techni-
ques not only within the project team, but also with and
between various stakeholders.
Key Terms Consistent with PMI Standards and Guides
management, 138
leadership, 138
acquire project team, 138
develop project team, 141
manage project team, 157
negotiation, 164
virtual teams, 166
Chapter Review Questions
1. What is the potential downside to bringing in
project workers too early in the project?
2. Why is it often necessary for project managers to
persuade workers to be part of the project team?
3. When is the best time to on-board core team
members?
4. What are the five stages of team development?
5. During which stage do team members often feel
close to one another and have a good under-
standing of how to work together?
6. List two personal values of individual team mem-
bers that contribute to a high-performing team.
List two team behaviors that can enhance these
personal values.
7. What are the two favorable outcomes of fostering
a high-performing project team?
8. During all five stages of team development, is it
important that the project manager keep in mind
the needs of which three groups?
168 Part 2 Leading Projects
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9. Why might it be helpful to bring out the charter
when people are arguing over a decision?
10. What is meant by the term ground rules? Give
examples.
11. Under which circumstances might a project
manager or sponsor retain the right to make a
project decision?
12. What are the benefits of delegating a decision to
one or two team members?
13. When might consensus be the best decision-
making strategy?
14. power is the ability to persuade
others based upon the project manager’s personal
knowledge and skills.
15. power should be used by a project
manager when she is asking her team members
to perform a task within their job description.
16. power should only be used in
instances in which it is necessary to maintain
discipline.
17. In order to manage stakeholders’ expectations, a
project manager needs to understand the stake-
holders’ assumptions. Which document(s) can
help with this?
18. The collaborative style for handling conflict has
a(n) concern for self and
a(n) concern for others.
19. Why is it important for project managers to have
one-on-one discussions with their core team
members?
20. What is a virtual team?
21. Name three increased challenges for a global
and/or virtual team.
22. Why is it helpful for a virtual team to meet in
person at least once?
Discussion Questions
1. You are a project manager leading an IT develop-
ment project. Halfway through your project, you
realize you need to hire an additional worker in
order to complete the project on time. How will
you convince your project sponsors to authorize
the hire? How will you on-board your new worker?
2. Describe how to use project documents to
help a team progress through the stages of
development.
3. How can a project manager promote the needs of
the organization during the norming phase?
4. How can a project manager promote the team
members’ needs during the forming stage?
5. Describe in your own words what a high-
performing project team can do.
6. Describe, in your own words, what you believe
are the four most important characteristics of
high-performing project teams. Tell why you
believe each is so critical, explain how they are
related to each other, and give at least two spe-
cific suggestions for each.
7. Assess your individual capability for project
teamwork. Tell why you feel you are strong in
certain capabilities, and give strategies for improv-
ing in areas you feel you need to develop.
8. What is meant by the term situational leader-
ship? How can you apply this as a project
manager?
9. Describe the three responsibilities of project team
members.
10. Pick the four ground rule topics for project teams
that you believe are the most important. Tell why
you believe each is so critical, explain how they
are related to each other, and give at least two
specific suggestions for each.
11. Using examples, describe how a project manager
can use active listening. Why is this useful?
12. Describe each method of decision making a proj-
ect team may use. Using examples, tell when each
is most appropriate.
13. In your opinion, why is it necessary for the proj-
ect manager to assess the performance of both
individual team members and the project team
as a whole?
14. List several characteristics of a project that can
often result in creating conflict.
15. Give an example of when a conflict would be
beneficial to a project and an example of when
conflict would be harmful to a project.
16. You are working for a multinational organization
and need to relay information to Japan. Which
communication method would you choose to use
and why?
17. Give as many examples of cultural differences as
you can, using information from this text and
your own experiences.
Chapter 5 Leading and Managing Project Teams 169
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PMBOK® Guide Questions
1. is the process of “confirming human
resource availability and obtaining the team nec-
essary to complete project activities.”
a. Plan Human Resource Management
b. Acquire Project Team
c. Develop Project Team
d. Manage Project Team
2. All of these are stages of team development
except:
a. adjourning
b. storming
c. learning
d. performing
3. establish(es) clear expectations
regarding acceptable behavior by project team
members, and may cover topics such as protect-
ing confidentiality, establishing trust, and han-
dling conflict.
a. The employee handbook
b. Ground rules
c. Management by objectives
d. Personnel directives
4. The objective of the process is to
improve competencies, team member interaction,
and overall team environment to enhance project
performance.
a. Plan Human Resource Management
b. Acquire Project Team
c. Develop Project Team
d. Manage Project Team
5. All of these are techniques for managing project
conflicts except:
a. smooth/accommodate
b. withdraw/avoid
c. collaborate/problem solve
d. none of the above
6. A document used to manage points of discussion
or dispute that arise during projects, in order to
monitor them and ensure that they are eventually
resolved and added to lessons learned, is called
a(n) .
a. risk register
b. stakeholder register
c. SWOT analysis
d. issue log
7. Which of these is not a challenge of working on
global and virtual teams?
a. competencies
b. language
c. time zones
d. culture
8. An output of the process Develop Project Team,
an evaluation of the team’s success in achieving
project objectives for schedule, budget and qual-
ity levels, is called team .
a. project performance review
b. performance assessments
c. annual review
d. work performance reporting
9. Which of the following steps is not part of the
six-step project conflict-resolution process?
a. Identify causes of conflict
b. Identify potential solutions
c. Determine which teammate was in the wrong
d. Understand the conflict
10. The sources of most project conflicts can be
grouped into those related to and
those related to .
a. relationships; tasks
b. technical skills; budget
c. personalities; deadlines
d. schedule; risks
I N T E G R A T E D E X A M P L E P R O J E C T S
SUBURBAN HOMES CONSTRUCTION PROJECT
Suburban Homes, a medium-sized, fast-growing construction
company, has an ambitious plan to expand its business to
several southern states in the United States as a result of
its significant growth and good reputation for building quality
single-family homes and townhomes.
As a project manager, Adam Smith worked for several
years in the construction industry and supplemented his
experience with project management education. From his ini-
tial realization that managing projects successfully requires
implementation of various project management processes,
170 Part 2 Leading Projects
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Semester Project Instructions
Assess your project team’s capability. Develop a strat-
egy to improve your team’s capability. Develop ground
rules to use on your project.
As a team, audit one of the other project teams in your
class and have them audit your team. Develop an improve-
ment strategy for that team based on the audit results.
Brainstorm situations for your project for which
each source of power makes sense.
Identify what you have done to manage and con-
trol stakeholder engagement and how you know the
current level of satisfaction that your stakeholders
feel. Identify issues you may need to negotiate and
determine the style you will use to handle the conflict
and your expectations at each step of the negotiation
process.
CASA DE PAZ DEVELOPMENT PROJECT
Questions for students to answer:
1. What actions do you suggest to help the project team
through the stages of team development?
2. What would you want to see in a team charter for this
development project?
3. Construct a RACI chart with major tasks you see and
the type of person you feel should do each.
4. List types of decisions that will need to be made and
the appropriate person, group, or method for each, for
example, individual team member, team collectively,
scrum master, and product owner.
tools, and techniques, Adam recognized the importance of
building project teams composed of well-trained staff. From
his experience managing a few projects in the Midwest and
based on the lessons learned from these projects, it was evi-
dent to Adam that Suburban Homes did not place a strong
emphasis on people-related factors and team development.
Adam recognized the scope for improvement in managing
and developing high-performance teams and decided to act
on this knowledge immediately.
Adam s primary task was to improve the performance of
project management and increase the project success rate,
so he wanted to address project team selection and the
team development processes. Further, he realized that
employee turnover and the expansion of the business in
southern states led Suburban Homes to recruit more
employees. Many of these new recruits have prior experi-
ence in the construction industry. In addition, the workforce
now represents different work cultures, attitudes, commit-
ment, and work ethics.
Adam recognized the immediate need to manage human
resources effectively and efficiently. He decided to formalize
project team selection, development, and management so
that all the locations in the Midwest and South will have sim-
ilar team management philosophy and practices. To achieve
these purposes, Adam has considered the following:
1. Train project managers as leaders. Also, project managers
must be trained to identify talent, select project team
members, and nurture their growth.
2. Develop a team charter so that all the team members
are aware of performance expectations, professional
behavior, and other team norms. The charter should also
help in training newly recruited employees to improve
productivity, collaboration, coordination, communications,
and conflict resolution.
3. Develop a conflict management plan and prepare guide-
lines for all employees to identify and manage conflicts.
4. Design and implement a decision-making protocol for all
the projects and in all locations.
5. Develop norms for high-performing teams.
You are hired as a consultant to develop the above five
deliverables.
Chapter 5 Leading and Managing Project Teams 171
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PROJECT MANAGEMENT IN ACTION
Centralizing Planning and Control in a Large
Company after Many Acquisitions
The restaurant chain where I work was founded over
50 years ago. Through internal growth and external
acquisitions, this company has become a Fortune 500
company. The company recently decided to centralize
merchandizing, retail operations control, advertising,
and sales planning for the enterprise.
Human resources (HR) and other support
organizations needed to improve their performance
to support this massive change. Cycle times were
too long, service quality was too low, and internal
customers frequently complained about corporate
functions. HR started its transformation by creating
a process improvement team to lead toward a
process-driven structure with work drivers
identified to establish staffing levels. A new HR
vice president had a vision for the operation,
and her leadership was critical to make anything
happen.
Up to this point, process engineering had only
been applied to manufacturing and distribution
operations. The culture for process engineering, proj-
ect management, and change management was gen-
erally immature in the company. This was declared to
be the biggest change to our HR function in 35 years.
A vice president was assigned to make the HR transi-
tion happen.
The project manager assigned to this project
immediately interviewed the various management
members of the HR organization and the retail opera-
tions transition team. He created a project charter to
define the scope, objectives, problem statement, out-
comes expected, benefits, team members, and inputs
for this project. This project manager interviewed all
senior staff members for their insights.
A communications plan was drafted because this
change directly touched several hundred persons and
indirectly many tens of thousands. The company is a
very large distributed organization with many global
operations. Therefore, a great deal of collaboration
was required to create the buy-in needed. A confer-
ence was held for all HR leaders to begin developing
this needed buy-in.
In preparation for the conference, the project man-
ager created the following high-level WBS:
1. Planning the HR Transformation
2. Initiating the Project
3. Planning the Workshops
4. Stakeholder Analysis
5. Communications Plan
6. Planning the Project
7. Executing the Plan
8. Holding the Workshops
9. Identifying Opportunities for Improvements
10. Obtaining the VOC (Voice of Customer)
11. Creating the Foundational Communications
12. Initial Launch
13. Executing the Implementation Plan
14. Sustaining the Transformation
A schedule was created that reflected all the WBS
elements needed to perform this massive organiza-
tional change initiative, driven by process analysis
and by meeting all the relevant PMI PMBOK® guide-
lines for project management good practices. This
project schedule covered the elements of a plan to
gather Voice of the Customer information and per-
form workshops for the identified Centers of
Excellence:
1. The business processing center
2. Total reward systems
3. Administration systems
4. Workforce planning systems
5. Talent management systems
6. Systems and data management
7. Training and development
The project schedule included all the communi-
cations needed to create synergy toward an agreed-
upon solution. At the end of the first conference, we
had a core team meeting of five leaders. The job of
the core team was to define a vision for the orga-
nization, a mission statement for the operation, and
an elevator speech that defined the project s objec-
tives and could be repeated in less than 45 seconds
172 Part 2 Leading Projects
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to a novice on the topic. This team s efforts gave us
great clarity regarding what we were trying to
accomplish.
Next, we brought in over 100 HR professionals
from around the company for a series of workshops.
An agenda and handouts were created to drive the
workshops. During the workshops, artifacts were
created to define the as is and to be process
states. These models were built in Supplier, Input,
Process, Output, Customer (SIPOC), and organization
deployment process maps. In addition, we created
organization structures to support the future-state
process maps. Once we designed structures, we
built job description documents and measurement
plans for the new and old processes. The processes
modeled impacted all HR operations. We needed to
know where the work would be accomplished.
We started the detailed organization chart reviews.
We needed to know where the work was done,
and by how many persons, today. Then we could
start to estimate how many resources might be
needed in a future state by location and by element
of work.
We evolved a framework of principles to drive the
project forward, which included:
Streamline every process using the lean Six
Sigma tools.
Focus on quality, speed, and cost while delivering
improved value.
Take transactions out to a service center where a
lower cost is achieved.
Drive all outside agreements toward negotiated
service level agreements.
Consider multiple alternatives for the sourcing of
needed services.
Improve the client-facing organization.
Build Centers of Excellence that deliver improved
value.
Push employee support closer to them while
leveraging consolidated service center capabilities.
Monthly HR leader conference calls, weekly status
reports, preliminary design sessions, corporate staff
design sessions, and follow-up conferences for
leaders were all part of the high-touch, high-
communications approach to this project. We expect
the many automation initiatives, headcount reduc-
tions, vendor outsourcing efforts, and in-sourcing of
transactions to a wholly owned service center to
deliver millions of dollars of cost reductions across the
company. We promoted lean and improvement ideas
continually to the leadership. We have collected field-
based best practices and have moved into a phase to
validate these practices. Once validated, these best
practices will be rolled out to all operations. We com-
municate by posting everything to a SharePoint site
for all to see. We also use e-mail communications and
have many one-on-one telephone calls.
We are now presenting the new design for imple-
mentation and are getting buy-in. We continue to
involve others and to learn what will meet their
needs and so far we are spot on with high accep-
tance. At one time, we thought all regions were dif-
ferent, and they are, but their processes and structures
are nearly 80 percent the same. We have reached
agreement that one common process is acceptable to
all regions asked. This is a major breakthrough. We
also have had concessions from labor relations
regarding its role and from those regions that were
already down the road on a couple key position
implementations.
The team concepts that were applicable to this
project were as follows:
Recognize the Forming, Storming, Norming, and
Performing stages.
Create a strong vision to rally the team.
Ask the customers of the process for
requirements.
Have consistent sponsorship of the project.
Respect, empower, and engage everyone in a
change initiative.
Respect differences and leverage the value of
diversity.
You cannot overcommunicate so communicate.
Make everything an open book.
Source: William Charles (Charlie) Slaven, PMP.
Chapter 5 Leading and Managing Project Teams 173
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of Ambidexterity in the Management of Complex
Engineering Projects,” Proceedings Project Man-
agement Institute Research and Education Confer-
ence 2012, July 2012, Limerick, Ireland.
Lussier, Robert N., and Christopher F. Achua, Leader-
ship: Theory, Application, Skill Development, 4th ed.
(Mason, OH: South-Western Cengage Learning,
2010).
Melkonian, Tessa, and Thierry Picq, “Opening the
Black Box of Collective Competence in Extreme
Projects: Lessons from the French Special Forces,”
Project Management Journal 41 (3) (June 2010):
79–90.
Merla, E., The Agile Minded Professional: 7 Habits
to Agility Success, Project Management Institute,
2011.
Mueller, Ralf, and J. Rodney Turner, “Cultural Differ-
ences in Project Owner–Project Manager Commu-
nications,” Innovations Project Management
Research 2004 (Newtown Square, PA: Project Man-
agement Institute, 2004): 403–418.
Opfer, Warren, “Building a High-Performance Project
Team,” in David I. Cleland, ed., Field Guide to
Project Management, 2nd ed. (Hoboken, NJ: John
Wiley & Sons, 2004): 325–342.
Owen, Jill, et al., “The Role of Leadership in Complex
Projects,” Proceedings Project Management Insti-
tute Research and Education Conference 2012, July
2012 Limerick, Ireland.
Pellerin, Charles J., How NASA Builds Teams: Mission
Critical Soft Skills for Scientists, Engineers, and
Project Teams (Hoboken, NJ: John Wiley & Sons,
2009).
PMI Code of Ethics and Professional Responsibility,
http://www.pmi.org/About-Us/Ethics/~
/media/PDF/Ethics/ap_pmicodeofethics.ashx,
accessed June 12, 2013.
Rath, T., and B. Conchie, Strengths-Based Leadership:
Great Leaders, Teams, and Why People Follow
(New York: Gallup Press, 2008).
Senge, Peter, Richard Ross, Bryan Smith, Charlotte
Roberts, and Art Kleiner, The Fifth Discipline Field-
book: Strategies and Tools for Building a Learning
Organization (New York: Doubleday, 1994).
Schlenkrich, Lara, and Christopher Upfold, “A Guide-
line for Virtual Team Managers: The Key to Effec-
tive Social Interaction and Communication,”
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12 (1) (2009): 109–118.
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Joiner, The Team Handbook, 3rd ed. (Madison, WI:
Oriel Incorporated, 2005).
174 Part 2 Leading Projects
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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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Thamhain, Hans J., “Team Leadership Effectiveness in
Technology-Based Project Environments,” Project
Management Journal 35 (4) (December 2004):
35–46.
_____, “Influences of Environment and Leadership on
Team Performance in Complex Project
Environments,” Proceedings, Project Management
Institute Research and Education Conference 2010.
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Life (New York: Gallup Press, 2009).
Endnotes
1. Daft, Richard L., Management, 9th ed.
(Mason, OH: Southwestern Cengage Learning,
2010): 5.
2. Lussier, Robert N., and Christopher F. Achua,
Leadership: Theory, Application, Skill Develop-
ment, 4th ed. (Mason, OH: South-Western Cen-
gage Learning, 2010): 6.
3. PMBOX® Guide 526.
4. PMBOK® Guide 537.
5. Adapted from Herrenkohl, Roy C., Becoming a
Team: Achieving a Goal (Mason, OH: Thomson
Southwestern, 2004): 185 and 216–217; Opfer,
Warren, “Building a High-Performance Project
Team,” in David I. Cleland, ed., Field Guide to
Project Management, 2nd ed. (Hoboken, NJ:
John Wiley & Sons, 2004): 326–327; and Melk-
onian, Tessa, and Thierry Picq, “Opening the
Black Box of Collective Competence in Extreme
Projects: Lessons from the French Special
Forces,” Project Management Journal 41 (3)
(June 2010): 79–90.
6. Merla, E., The Agile Minded Professional: 7
Habits to Agility Success, Project Management
Institute, 2011.
7. Thamhain, Hans J., “Team Leadership Effective-
ness in Technology-Based Project Environ-
ments,” Project Management Journal 35 (4)
(December 2004): 39.
8. Adapted from Herzog, Valerie Lynn, “Trust
Building on Corporate Project Teams,” Project
Management Journal 32 (1) (March 2001): 33–
34; and Kloppenborg, Timothy J., and Joseph A.
Petrick, “Leadership in Project Life Cycles and
Team Character Development,” Project Manage-
ment Journal 30 (2) (June 1999): 11.
9. Anantatmula, Vittal, Project Teams: A Structured
Development Approach (Business Expert Press:
New York, NY, 2016).
10. Adapted from Schlenkrich, Lara, and Christo-
pher Upfold, “A Guideline for Virtual Team
Managers: The Key to Effective Social Interaction
and Communication,” Electronic Journal of Infor-
mation Systems Evaluation 12 (1) (2009): 110.
11. Mueller, Ralf, and J. Rodney Turner, “Cultural
Differences in Project Owner–Project Manager
Communications,” Innovations Project Manage-
ment Research 2004 (Newtown Square, PA: Proj-
ect Management Institute, 2004): 403–418.
Chapter 5 Leading and Managing Project Teams 175
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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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C H A P T E R 6
Stakeholder Analysis and
Communication Planning
Humans are social animals who engage with each other in complex ways, espe-
cially in artificial environments such as organizations and projects. Inexperienced
project managers can become buried in the control of the project plan s tactical
aspects and miss the more strategic components like stakeholder engagement
and effective communication. Ultimately, successful delivery of a project is
about both managing the tangible outputs (which are generally easily and objec-
tively measured (time, cost, and project deliverables) and leading others through
the more strategic and intangible outcomes (relations, power, influence, motiva-
tion, interests, etc.). Traditionally, measures of success focus on scope, time,
cost, and quality to determine the success of the project as an entity. However,
a more accurate measure of success also considers the longer-term outcomes
delivered by what your project stimulated to happen after it was complete.
For example, the Sydney Opera House was a disaster as a project, but it made
highly significant contributions to the culture, identity, meaning, and belonging of
the Australian nation well beyond being a failed project, and there are many other
examples like this in human history. Equally, there are project successes that
am
op
ho
to
_a
u/
Sh
ut
te
rs
to
ck
.c
om
CHAPTER OBJECTIVES
After completing this
chapter, you should
be able to:
CORE OBJECTIVES:
Enumerate, describe,
and prioritize each
set of stakeholders
for a project.
List each section
of a project commu-
nications plan and
describe the role
each plays.
Build a communica-
tions matrix for a
real project.
Develop strategies
for stakeholder
management.
BEHAVIORAL OBJECTIVES:
Tell how to build
project relationships
and why they are
important for
communications.
Develop a project
communications
management plan
for a real project.
Plan, conduct, and
improve project
meetings.
176
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only make negative contributions to society. This is because your stakeholders
have varying perceptions of the worth of the project.
Stakeholders and your communications with them are highly subjective
aspects of projects and more difficult to manage than some of the hard skills dis-
cussed in earlier chapters. As such, these aspects are often not managed with
anywhere near the time and thought investment of the tangible aspects of a proj-
ect. And while not every project manager (PM) needs to be a skilled wordsmith
or a psychologist (though these would, in fact, be very useful skills for a PM to
have), the PMBOK ® is now starting to build more content around these aspects
of leading and managing projects, and there is increasing literature acknowledg-
ing the importance of the soft skills required to be a successful project man-
ager. Capable project managers invest effort to create and maintain informed
stakeholder engagement matrices and insightful communications plans. They
know whom to engage at what stage of the project (including critical stake-
holders before the project starts, at times), at what frequency, and through
what medium to secure optimal results. They then implement this plan and
adjust as circumstances change. In essence, this is the art of project
management.
One effective and fun way a PM can accelerate the development of their
stakeholder engagement and communication skills is to use metaphor reflections
developed by Arthur Shelley. This approach uses animals to represent behaviors
and stimulate constructive conversations about interactions between people. The
Organizational Zoo describes a set of 27 characters that collectively represent the
most common behaviors in the Zoo (that is, your team, project, organization, or
community). They are easy to remember (one for each letter of the alphabet,
plus one double ), and the cartoon characters help to make the conversation
fun. Team members profile themselves and their stakeholders in order to under-
stand what they are like and how they should engage with them. Because we all
have considerable prior knowledge of animals, understanding is intuitive, and the
tool makes it easy to quickly assess our behavioral environments. It is clear a
10.2 Manage
Communications
10.1 Plan
Communications
Management
Communications
Matrix
Agendas
Minutes
Issues Log
Meeting Evaluation
Lessons Learned
Register and
Retrospectives
13.3 Manage
Stakeholder
Engagement
13.2 Plan Stakeholder
Engagement
Stakeholder
Engagement
Assessment matrix
13.4 Monitor
Stakeholder
Engagement
13.1 Identify
Stakeholder
Stakeholder
Register
4.2 Develop Project
Management Plan
4.4 Manage
Project Knowledge
PMBOK® GUIDE
Topics:
Identify stakeholders
Plan stakeholder
engagement
Manage stakeholder
engagement
Monitor stakeholder
engagement
Plan communications
management
Manage
communications
CHAPTER OUTPUTS
Stakeholder register
Stakeholder engage-
ment assessment
matrix
Strategies for manag-
ing different
stakeholders
Communications
matrix
Meeting agenda
Meeting minutes
Issues log
Meeting evaluation
177
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mouse does not approach a lion in the same way it would approach a dog, and a
lion leader is different from an eagle.
In projects, the use of creative tools such as metaphor and reflective conversa-
tions is becoming more common and makes a significant contribution to success
and the learning experiences of those involved. The free online profiler can be
used for project team activities and to discover more about your own inner
animals.
www.organizationalzoo.com/profiler
Copyright Arthur Shelley, 2013
Image artist John Szabo
6-1 Identify Stakeholders
Projects are undertaken because someone needs the project’s output. A project must sat-
isfy its users and their needs to be successful. Several things can complicate this goal.
First, there may be multiple users, and each may have different wants and needs. Second,
often end-users may not fully understand what they want because they do not know
what alternatives may be available. Third, the customer who pays for the project may
not be the actual person or group who uses the project deliverable or outcome, and the
customer may not fully understand the end-users’ needs. Fourth, when someone else is
©
Ar
th
ur
Sh
el
le
y
178 Part 2 Leading Projects
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paying for the project, some users will ask for many project outcomes that are expensive
or time consuming to deliver. Finally, many stakeholders, in addition to the users of a
project’s outcomes, have an interest in the project. Project managers need to first under-
stand their stakeholders, build relationships with them, and then develop a communica-
tions management plan for managing them.
6-1a Find Stakeholders
One way to understand who stakeholders are is to ask, “Who will use, will be affected by,
or could impact this project?” The answer includes users of the project results and others
who may have some changes forced upon them by the project outcomes. It also includes
people and groups who might choose to influence the project in some way. We use the
identify stakeholders process to determine the people, and groups, who might impact or
be impacted by some aspect of our project. Stakeholders include people who:
Work on the project
Provide people or resources for the project
Have their routines disrupted by the project
Monitor regulations, laws, and standards of practice at local, county, state, and fed-
eral levels
Another way to identify stakeholders is to determine whether they are internal to the
organization performing the project or external to it. Examples of project stakeholders
based on these categories are shown in Exhibit 6.1. Note that there are potentially more
types of stakeholders affected by the process of performing the project than by the proj-
ect results and more external than internal stakeholders.
Project managers and project core teams (often in consultation with the project spon-
sor) can use the examples in Exhibit 6.1 to find possible project stakeholders. This can be
done using a brainstorming technique. Classic rules of brainstorming apply—initially, the
emphasis is on generating a long list of potential stakeholders in the first column of a
EXHIBIT 6.1
EXAMPLES OF PROJECT STAKEHOLDERS
INTERNAL EXTERNAL
Affected by Project Process Owner
Sponsor
Project Manager
Functional Managers
Competing Projects
Financing SourceProject Core Team
Subject Matter Experts
Employees
Stockholders
Suppliers
Partners
Creditors
Government Agencies
Special Interest Groups
Neighbors
Client
Professional Groups
Media
Taxpayers
Union
Competitors
Affected by Project Result Internal Customer
Sponsor
Users
Client
Public
Special Interest Groups
Chapter 6 Stakeholder Analysis and Communication Planning 179
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chart without evaluating and analyzing them. It may be easy to construct this chart on a
large work surface such as a whiteboard or flip chart. Another suggestion is to be spe-
cific; identify stakeholders by name when possible.
For each potential stakeholder, list the various project processes and results in which
he or she might have an interest. Consider financial, legal, and emotional interests of
potential stakeholders. The project charter can be useful here. Many stakeholders have
an interest in multiple aspects of a project. Once the stakeholders and their interests
have been listed, they may be combined into like groups with the same interests.
6-1b Analyze Stakeholders
Stakeholder analysis is a stakeholder identification technique composed of gathering
and evaluating information to determine whose interests should be emphasized through-
out the project. The first part of stakeholder analysis is to prioritize the stakeholders.
Prioritization is important because on many projects, there are too many stakeholders
to spend a great deal of time with each. While it is important not to ignore any stake-
holder, it also makes sense to concentrate on those who are most vital. Stakeholders are
frequently prioritized based upon level of:
1. Power—ability to get others to do something
2. Legitimacy—perception that their actions are appropriate
3. Urgency—time sensitivity and legitimacy of claim1
Some organizations use additional criteria such as interest, influence, and impact.
Some organizations only use two or three criteria; others may use up to six. Each aspect
used can be rated on a simple scale of 1 to 3, with 3 representing the highest priority. For
the first aspect, power, a stakeholder who could order the project shut down or changed
in a major way would be a 3, and a stakeholder who could not change the project much
would be a 1. The other aspects can be analyzed in a similar fashion. The scores from the
aspects are added to form a total prioritization score.
We will use an example of an African university that changed its entire curriculum to
a modular approach—a major change project. This large university was in danger of clo-
sure because of failed quality ratings and public criticism of its performance. Major
improvements were required. The newly appointed vice chancellor decided to modular-
ize all the courses offered by the university, which allowed the students to “pick and
mix” topics and create courses that better suited their needs. This change impacted
every part of the university, and it was not a popular decision. The appropriate engage-
ment of stakeholders was crucial. One of the major challenges to the modularization pro-
gram was the shift in power base from academic management (the deans of faculty) to
the academic registry. In Exhibit 6.2, you can see that the academic registrar scores
highly in every line. This shift in power was always going to meet resistance, and the
program manager would need to carefully consider the positions of the three key stake-
holder groups to find an appropriate strategy.
By determining who the stakeholders are and what each group wants, project man-
agers effectively:
Set clear direction for further project planning, negotiating, and execution
Prioritize among competing objectives
Learn to recognize complex trade-offs and the consequences of each
Make and facilitate necessary decisions
Develop a shared sense of risk
Build a strong relationship with their customers
180 Part 2 Leading Projects
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Lead associates, customers, and suppliers with empowering style and principles
Serve as good stewards of the resources of both the parent and customer
organizations
The project team should next select the top 10 to 15 stakeholders for emphasis in the
remainder of their planning. The stakeholders with the highest total scores are often con-
sidered to be key influencers for the project. The project manager and the core team
should also plan to periodically review this prioritized list of stakeholders, as the relative
importance may change as the project progresses, especially if the project goals are not
clear at the outset. While from a practical standpoint, project managers need to be espe-
cially attentive to the top stakeholders, the enlightened “management for stakeholders”
approach also encourages project managers to ensure that interests of all the stake-
holders, including less powerful ones, are considered.2 This approach of giving prefer-
ence to the most important stakeholders while recognizing needs of all stakeholders
requires judgment, and the advice of the sponsor is often helpful.
One additional consideration is that various stakeholders often have competing inter-
ests. For example, the client may want the work done quickly, while the accountant is
worried about cash flow. Exhibit 6.3 itemizes how different types of stakeholders fre-
quently define project success. Another consideration is that each project was selected
to support a specific business purpose and that purpose should help determine the rela-
tive importance of various stakeholders.
It is not necessary that all stakeholders favor the project. Competitors in the business,
public interest groups, voluntary organizations that promote environmental sustainability
and, occasionally, a segment of end-users may oppose the project and its execution. The
project manager must identify them and monitor their actions closely.
EXHIBIT 6.2
MODULAR COURSES: STAKEHOLDER IDENTIFICATION AND PRIORITIZATION MATRIX
VICE
CHANCELLOR
DEANS OF
FACULTY (*)
ACADEMIC
REGISTRAR: LECTURERS: (*)
STUDENT
SUPPORT STUDENTS
What Is
Important to
This Stakeholder
Power 3 3 3 2 1 1
Interest 3 1 2 1 2 2
Influence 1 3 2 2 1 1
Impact 3 2 3 1 1 1
Urgency 2 1 2 1 1 1
Legitimacy 2 1 3 3 1 3
Total: 14 11 15 9 7 6
Priority
(Key or Other):
Key Key Key Secondary Other Other
(*) Lecturers and the deans are unlikely to be homogeneous in their views—more information is needed to identify groupings and interest areas. For this
case, we have kept it simple. Source: Louise Worsley.
Chapter 6 Stakeholder Analysis and Communication Planning 181
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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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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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If the project team developed the stakeholder identification and prioritization matrix
without their sponsor, now would be a good time to share it with the sponsor and ask
for feedback. Chances are good the sponsor will want to make some adjustments before
the team continues with the stakeholder management plan. Sponsors are especially useful
in helping to sort out conflicting priorities. Typically, when a conflict exists, external
paying customers and top management are considered to be highly important stake-
holders. The project team primarily considers these top stakeholders while they:
Develop a communications plan (later in this chapter)
Define the scope of the project (see Chapter 7)
Identify threats and opportunities (see Chapter 11)
Determine quality standards (see Chapter 12)
Prioritize among cost, schedule, scope, and quality objectives (see Chapter 12)
6-1c Document Stakeholders
The primary output of the “identify stakeholders” process is a stakeholder register. The
stakeholder register is a repository of information regarding all project stakeholders.
Teams use it to develop strategies to either capitalize upon stakeholder support or to miti-
gate the impact of their resistance. The stakeholder register provides input to relationship
building with the various stakeholders and helps determine their requirements. In turn,
these requirements serve as the basis of developing project scope. The stakeholder register
is a living document that changes as needed. A stakeholder register often is in the format
of a matrix. In the stakeholder register shown in Exhibit 6.4, we start to evaluate the
interests of the different stakeholder groups. Sometimes referred to as the WIIFT
EXHIBIT 6.4
MODULAR COURSES: PROJECT STAKEHOLDER MATRIX
STAKEHOLDER INTEREST IN PROJECT PRIORITY SUPPORT/MITIGATION STRATEGIES
Vice Chancellor Make major improvements in university
services and avoid government intervention.
Key Consult on target improvement areas—use his
power to support key and difficult changes.
Deans of Faculty Protect against changes that could influence
their power base. Reduce detrimental impact
on faculty activities.
Key Work with nominated representatives to
identify and seek out solutions to barriers to
change. Establish and communicate wins for
faculties.
Academic
Registrar (AR)
Develop the power base of AR—demand
and obtain quality improvements on courses
across the university.
Key Increase visibility and power of AR. Increased
visible support for AR regarding resources and
political support from senior management.
Lecturers Be kept informed of impacts upon them.
Reduce or resist changes that are considered
negative to them.
Secondary Identify supportive champions. Create, test,
and deliver carefully considered communica-
tion strategy.
Student support Be able to prepare and train staff on how to
roll out new schemes to current and
prospective students.
Other Help student support guide staff through
process—develop training programs and
online web support.
Students University shows signs of improvement and
ensures students’ needs are considered.
Other Set up consultation and communication
groups. Keep informed.
Source: Louise Worsley.
Chapter 6 Stakeholder Analysis and Communication Planning 183
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(what’s-in-it-for-them), this analysis can be used to help identify where there may be com-
mon areas of interest between the groups, and note that what made this particular pro-
gram complex was the absence of common ground. Strategies would need to be sought
to change positions or reduce the impact of the behaviors of some of the groups.
6-2 Plan Stakeholder Engagement
Project teams plan stakeholder engagement both by creating a tool called a stakeholder
engagement assessment matrix and by planning to build relationships with the
stakeholders.
6-2a Creating a Stakeholder Engagement Assessment Matrix
Project teams create a stakeholder engagement plan to define how they will effectively
engage stakeholders in planning and performing the project based on the analysis of
the stakeholders’ needs, wants, and impacts. A primary tool used in this plan is the
stakeholder engagement assessment matrix. This matrix typically includes a first col-
umn showing the stakeholders. For each stakeholder, additional columns may repre-
sent how much they are currently supporting or opposing the project, where you
would like them to be, barriers to their changing, and strategies you may employ to
move them. Strategies for powerful and supporting stakeholders may include accepting
their ideas, compromising, or offering them trade-offs, while strategies for opponents
might entail doing the minimum possible or fighting their demnds.3 It is not uncom-
mon to think that the best one can do with opposing stakeholders is to help move
them to a neutral position, while those who are unaware of or neutral toward the proj-
ect may be turned into supporters.
Fi
rm
a
V/
Sh
ut
te
rs
to
ck
.c
om
184 Part 2 Leading Projects
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Exhibit 6.5 identifies both the current and target positions of the stakeholder
groups. The greater the change in position, the greater the risk and the greater the
engagement effort required. Student Services had a relatively unimportant position in
the old system but would be critical to the new modularized operation. Significant
expenditure was anticipated in this area. It is of interest to note that the initial analysis
(see Exhibit 6.4) had identified this group as “other stakeholder.” As the nature and
impact of changes become clearer, they can alter the relative importance of different
groups. Stakeholder positions and stakeholder strategies must be reevaluated through-
out the project.
6-2b Planning to Build Relationships with Stakeholders
Project managers and teams seek to develop strong working relationships with important
stakeholders. This is an ongoing process throughout the life of the project. In fact, the
project manager normally continues to nurture the relationship even after the project is
completed to increase the chances of securing future project work and to maintain good
will with the external stakeholders. In building relationships both within the project core
team and with other stakeholders, project managers need to remember that mutual respect
and trust greatly enhance the prospect of project success. Therefore, relationship-building
activities that lead to respect and trust should be planned and carried out carefully.
EXHIBIT 6.5
MODULAR COURSES STAKEHOLDER ENGAGEMENT ASSESSMENT MATRIX
STAKEHOLDER
CURRENT
POSITION
TARGET
POSITION BARRIERS TO CHANGE STRATEGY
Vice Chancellor Leading Leading Competing day-to-day priorities Ensure engagement is ‘efficient’ and effec-
tive. Consider extending role of deputy
Chancellor to cover for some day-to-day
activities.
Deans of Faculty Resistant Neutral,
Supportive,
or Leading
Some Deans more powerful than
others (relates to student numbers
and academic ratings). ‘Power
owners’ are very influential.
Consider each Dean’s WIIFT individually.
Consider strategies for individuals as well
as the group.
Academic
Registrar (AR)
Supportive Leading Competing day-to-day
priorities—lack of leadership
skills.
Engage deputy, provide skills and
mentorship.
Lecturers Unaware
to neutral
Neutral or
supportive
Very large group with veto power
through unionized actions.
Involve HR and legal department to evalu-
ate all changes that may impact lecturers.
Identify supportive champions and stake-
holder groupings for engagement.
Student support Neutral Leading Not considered important by
academic staff—services currently
limited and not highly rated.
Provide consultancy support to team to re-
design and promote new services (includ-
ing student website).
Students Unaware Neutral Very large group. Student repre-
sentative council not well resourced
or highly valued by students.
Set up consultation and communication
groups. Keep informed. Consider use of
social media.
Chapter 6 Stakeholder Analysis and Communication Planning 185
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AGILE A principal idea in Agile is that relationships with stakeholders need to be based uponcollaboration, communication, and trust. Analyzing stakeholder information helps the
Agile team understand them better and leads to effective relationship building. It makes
more sense for Agile as client interaction is continuous and desirable throughout the
project life cycle.
Typically, relationship-building activities are most effective when they are used in the
process of planning a project. Project relationship-building activities (described more
fully below) that are especially useful include the following:
Share individual motives.
Encourage open communication.
Jointly establish agenda.
Use shared learning.
Regularly celebrate success.
Share enjoyment of project.
Use appropriate decision-making and problem solving.4
Establishing a positive relationship early with all key stakeholders is vital for two rea-
sons. First, it helps create a desire on the part of stakeholders to give positive support to
the project—or at least refrain from disrupting the project. This early building of a coali-
tion of supporters and engagement of opposition can help to positively shape the social
and political context of the project and lead to success.5 Second, it serves as the commu-
nications foundation for the project. The remainder of the project planning and execu-
tion are greatly enhanced by effective communication channels with key project
stakeholders.
The sponsor, project manager, and core team can establish powerful and meaningful
relationships with key stakeholders by delivering on all promises, always providing fair
treatment, creating a sense of pride by association, and even helping the stakeholder
develop a passion for the project.6 This starts by learning what motivates each stake-
holder. The old saying “What is in it for me?” describes what each stakeholder wants,
and that is what the project team needs to understand. Stakeholders who feel threatened
can disrupt a project during its process and are less likely to perceive that they receive
project benefits in the end. Unhappy stakeholders are a sign of project failure. On the
other hand, stakeholders can be treated as partners right from the start of planning by
speaking their language and providing them opportunities to participate. Here are some
things that customers (one of the primary stakeholders) value most from a contractor
who is performing the project:
A sincere invitation to early and continued involvement
Responsiveness
Transparency
Reliability7
These stakeholders are more likely to take ownership in the project by educating the
project team about their needs and making timely project decisions. Consequently, sta-
keholders are more likely to feel that their expectations are in line with the project team’s
plans. They are more likely to go beyond merely inspecting results and writing checks.
Further, they may participate early and often when their input is meaningful and they
feel that the project is successful. The important thing for project managers to remember
is that developing respect and trust among all project stakeholders is a goal that must be
186 Part 2 Leading Projects
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started early and continued throughout the project. Stakeholder relations and engage-
ment are just as critical to project success as the more technical planning and should
demand equal attention from project managers.
6-3 Manage Stakeholder Engagement
Manage stakeholder engagement is a process of the project team communicating and
working with stakeholders to satisfy their needs (and additional desires, when possible),
handle issues quickly, and encourage active stakeholder participation throughout. This
process can be visualized as shown in Exhibit 6.6, with managing on the left and moni-
toring on the right.
The first part of managing stakeholder engagement—understanding stakeholder
assumptions—was performed while creating the charter (Chapter 3), along with the stake-
holder register and stakeholder engagement assessment matrix discussed earlier in this
chapter. The requirements matrix, which will be developed in the following chapter, is
also helpful in understanding stakeholder assumptions. Different stakeholders may hold
very different assumptions concerning the project at the outset, and these assumptions
form the basis of their expectations. Therefore, the project manager clarifies the assump-
tions, challenges and negotiates some of them, and uses them in project planning.
These clarified assumptions are then stated as expectations regarding project deli-
verables, features of the product, timelines, costs, quality measures, and generally
how the project manager and team will act. Next, the stakeholders have a chance to
agree or challenge the expectations before committing to them. The expectations are
then documented.
EXHIBIT 6.6
MANAGING AND MONITORING STAKEHOLDER ENGAGEMENT
Understand
Stakeholder
Assumptions
Clarify
Stakeholder
Assumptions
Achieve
According to
Stakeholder
Assumptions
Adjust
Strategies as
Needed
Reconfirm
Stakeholder
Expectations
Co
nt
in
uo
us
ly
M
on
ito
r:
Re
la
tio
ns
hi
ps
,
Co
m
m
un
ic
at
io
ns
, a
nd
L
es
so
ns
L
ea
rn
ed
Chapter 6 Stakeholder Analysis and Communication Planning 187
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AGILE
During project execution, the team works toward satisfying these expectations. This
involves work between project meetings to complete assigned activities and to quickly
resolve problems that have surfaced. Concurrent with the achievement of expectations
is the continual recommitment to the expectations. One method that project teams can
use to reconfirm expectations is to share planning documents, such as schedules, with
stakeholders. The team informs the stakeholders that all the planning documents reflect
the team’s understanding of what has been asked to do. It is what the team is expected to
achieve and be judged against.
Some stakeholders may identify further expectations when they see everything
spelled out. Project managers often hold informal conversations with various stake-
holders to ensure that they fully understand and agree with all of the planning details.
Finally, as project teams report progress to stakeholders, additional expectations
emerge. When additional expectations emerge, they need to be considered in terms of
the project’s formal change control process and, if accepted, the project plan will be
revised and these additional expectations would become additional project activities to
be performed. All of the activities related to managing engagement increase support
from those stakeholders who favor the project and decrease resistance from other
stakeholders.
6-4 Monitor Stakeholder Engagement
Monitor stakeholder engagement is the process of engaging stakeholders and managing
relations with them effectively. The vertical box on the right in Exhibit 6.6 shows three
things a project manager must monitor throughout the process of managing stakeholder
expectations: relationships, communications, and lessons learned. Through honest and
ethical behavior, the project manager and project team must build trust with all project
stakeholders. They need to continually manage effective two-way communications with
all stakeholders as described in the communications plan. This includes a true willing-
ness to encourage stakeholders to ask probing questions, as that is an effective way to
develop confidence with some stakeholders. Finally, they should use lessons learned
from previous projects and previous phases of the current project. Armed with trusting
relationships, effective communications, and methods to overcome some problems from
previous projects, the team is prepared to adjust strategies and plans as needed to control
stakeholder engagement.
On Agile projects, stakeholders need to be educated about their roles; alerted in advance
concerning changes; and request early and continuous feedback. These are all excellent
methods to use on any project.
6-5 Plan Communications Management
The project team should next create the communications management plan. This plan
considers stakeholders’ information desires and guides the project communications. It
needs to be a living document that adapts to changing project needs.
6-5a Purposes of a Project Communications Plan
Projects face many challenges, including technical, cost, and schedule difficulties. Failure
to manage any of them well can throw off a project. Perhaps the most common
188 Part 2 Leading Projects
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challenge to project success is communication. Many projects require a group of people
to work together who have not done so before. Projects may involve people from various
functional areas that all have their own unique challenges. Sometimes, people from mul-
tiple companies may end up working together on projects. All projects are unique and
therefore they have a different set of stakeholders. “Communication leads to cooperation,
which leads to coordination, which leads to project harmony, which leads to project
success.”8
6-5b Communications Plan Considerations
A myriad of considerations must be kept in mind when creating a communications plan.
A project team can develop a workable communications plan, use it, and improve it as
the project progresses. Some factors that Fiesta® San Antonio organizers considered
when creating a project communication plan are shown in Exhibit 6.7. These factors
apply to all project communications. Therefore, we discuss these factors first and then
explain who provides information needs to the project team and to whom the team
needs to supply information.
PURPOSE COLUMN The first column in Exhibit 6.8 instructs a project team to con-
sider the purpose for each communication. Without good use for the communication, it
makes no sense to develop it. A project manager must use effective communications to
set and manage expectations of all stakeholders as well as to ensure that project work is
completed properly and on time. Communications from stakeholders are necessary in
EXHIBIT 6.7
FIESTA SAN ANTONIO COMMUNICATION PLAN NEEDS
In August 2012, the Institute of Texan Cultures, a museum specializing in Texas culture and diver-
sity, forged a partnership with the Fiesta® San Antonio Commission to produce a series of exhibi-
tions showcasing the traditions of Fiesta®, San Antonio’s premiere festival. Fiesta® is an annual 10-
day festival of over 100 events and 5 large parades. The festival draws 3.5 million visitors. It is tradi-
tion for Fiesta® events to commission new medals each year to give to event-goers to wear and trade
throughout the festival.
The museum’s leadership team convened with the Fiesta® San Antonio Commission’s executive
director at the end of August to assemble a project management plan. The parties identified sta-
keholders who would be impacted by the project. They prioritized stakeholders by influence, and
divided responsibilities for developing and maintaining relationships with each of those
stakeholders.
The following challenges were anticipated:
It would take time for the 120 Participating Member Organizations (PMOs) to reach their
members and assemble a full collection of medals to loan to the museum.
Some PMOs might be offended if their medals were not displayed more prominently than
other PMOs.
The museum would be engaging the same PMOs to support future exhibitions, so it was
critical to maintain positive relationships.
It was clear that a comprehensive communications plan would need to be implemented to estab-
lish lines of communication, nurture relationships, and manage the flow of information between
stakeholders.
Source: Aaron Parks, Institute of Texan Cultures
Chapter 6 Stakeholder Analysis and Communication Planning 189
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authorizing work, determining requirements, uncovering and resolving issues and
assumptions, and receiving feedback on project progress and results. Different stake-
holders often have conflicting desires; effective communications are necessary to under-
stand and resolve these differences. Communications to stakeholders are necessary to
help them make good decisions (by understanding options and risks), assure them of
adequate understanding and project progress, enable them to fully commit to the project,
and be ready to accept project deliverables. Yet another communication purpose is to
plan and manage escalation of issues that cannot be handled in a timely manner by the
project manager. Wise project managers determine in advance how soon an issue will be
escalated to the sponsor and/or other decision makers. Finally, communications plans
ensure that at project conclusion, meaningful lessons can be documented to benefit
future projects.
A project manager develops trust with her core team and other stakeholders partly by
using open and transparent communications to the extent possible. However, she needs
to respect all promises of confidentiality and to use good judgment on what is or is not
appropriate to share.
STRUCTURES COLUMN The second column suggests that when an organization has
adequate existing communication structures, it should use them! There is no need to
reinvent every document and, indeed, it would be confusing and costly to do so. Many
stakeholders in organizations are accustomed to a particular method of communications,
and using that method will make it easier for them to understand you. When no exact
organizational model is available for a specific communication, one can use a template,
which is still easier than creating an entirely new type of document.
EXHIBIT 6.8
PROJECT COMMUNICATIONS PLAN CONSIDERATIONS
PURPOSES STRUCTURES METHODS TIMING
Authorization Existing organizational
forms (reuse)
Push methods: Project life cycle
Direction setting
Project specific:
Instant messaging Charter
Information seeking
Templates (adapt)
E-mail Project plan
Status reporting:
Unique (create)
Voice mail Milestones
Schedule Text Output acceptance
Cost Pull methods: Project close-out
People Shared document repositories Routine time
Risk Intranet Daily—member
Issues Blog (repository) Weekly—core team
Quality Bulletin boards Monthly—sponsor
Change control Interactive methods: As needed—others
Approval of project outputs Telephone—teleconferencing
Escalation Wikis
Lessons learned VOIP/videoconferencing
Groupware
190 Part 2 Leading Projects
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Using any of the three choices, project teams need to maintain version control on all
of their communications. One easy method is to end the file name of every document
with six numbers representing year, year, month, month, and day, day. For example, an
early version of this chapter was saved on February 1, 2017, and the file name given was
“Chapter 6 Stakeholder Analysis and Communication Planning 170201.” The advantage
of a simple system is that the files can still be easily found by their descriptive named
titles, but they can also be sorted easily by the last date they were updated.
METHODS COLUMN The third column in Exhibit 6.8 deals with methods of commu-
nicating. Projects rely on “push” methods in which communications are sent or pushed;
“pull” methods where communications are posted either on paper or in electronic form
and interested stakeholders need to take the initiative to receive the communication; and
interactive methods in which communications flow in multiple directions. A typical proj-
ect communication plan will utilize a variety of these methods.
TIMING COLUMN The fourth column is a reminder that a project team needs to con-
sider timing issues when developing a project communications plan. Communications
typically are delivered according to one of three types of timing schedules. First is the
project life cycle, with communications typically needed at the end of each major stage
in the project and upon completion of each major project deliverable. The second timing
schedule follows a more formal organizational structure. Project progress is often
reported at regularly scheduled meetings. Meetings at the frontline level are usually
more frequent than reports to higher levels within the organization. The third timing
scheme is on an as-needed basis. Many times, a stakeholder wants to know a certain
fact about a project and cannot wait until the next formal meeting or report. Project
teams need to keep themselves up to date so they can handle the as-needed requests.
6-5c Communications Matrix
At this point, project teams will normally assemble a project communications matrix.
This matrix lists the following information:
The communications needs of each project are unique and, therefore, the assignment
of communications responsibilities will vary widely from project to project. A partially
completed project communications matrix for the Modular courses program is shown
in Exhibit 6.9. This identifies the information needs of the program team and the stake-
holders. Various methods of communication are proposed, depending on the purpose of
the communication and the constraints within which the stakeholder engagement must
take place. It won’t be possible to meet with the program board every day, so weekly
meetings, supplemented by short one-on-one stand-ups with the Vice Chancellor are
planned. It was decided to create a program board made up of key decision makers—to
Who does the project team need to learn from?
What does the team need to learn from this stakeholder?
Who does the project team need to share with?
What does this stakeholder need to know?
When do they need to know it?
What is the most effective communications method for this stakeholder to
understand?
Who on the project team is responsible for this communication? (the owner)
Chapter 6 Stakeholder Analysis and Communication Planning 191
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serve as an important communication and decision-making conduit for the program.
The actual communication plans impact the scope of the project. For example, having a
program newsletter adds to the scope—the effort and costs of the project. In complex
projects, the communications plan can form a major proportion of the project scope.
Stakeholders want to know how much work has been successfully delivered (accep-
tance tests passed) and how much work is remaining. Project team members use the
information to motivate and improve their performance. Sponsors use the information
to strategically understand if the project team will complete all work on time and within
budget. Other stakeholders may share the sponsors’ overall concern but want details of
work that concerns their functions. While these communication needs are common on
all projects, Agile projects have unique reports such as velocity, burn-down charts, run-
ning tested features, and earned business value.9
6-5d Manage Project Knowledge
If a company does extensive project work and uses project management capability as an
organizational strength, it is important to keep developing expertise in it. One way to
develop and expand expertise is to capture and reuse the knowledge developed. Knowl-
edge can be defined as insights derived from information and experience. Knowledge
also is “a conclusion drawn from information after it is linked to other information and
compared to what is already known.”10 Ironically, knowledge will remain dormant, and
not very useful, until it is reflected in future actions. Manage project knowledge is the
process of using and developing knowledge to help improve both the current project and
the capability of the organization.
To increase knowledge and the successful use and reapplication of it, organizations often
create a lessons learned knowledge base. For this database to be useful, it is important to
EXHIBIT 6.9
MODULAR COURSES – PROJECT COMMUNICATIONS MATRIX
STAKEHOLDER
PROJECT INFO.
NEEDS
STAKEHOLDER
INFO. NEEDS METHODS TIMING
Program Board
(Vice Chancellor)
Direction, strategy,
budget,
authorizations
Status—progress
and SH positions
Scheduled board meetings, cir-
culated minutes, one-on-ones
with Vice Chancellor
Weekly and as needed
Daily 15-min. stand-up with
Vice Chancellor
Deans of Faculty Concerns, WIIFT Plans, changes to
practices affect-
ing their staff
Program newsletter, across-
faculty workshops, informal
one-on-ones consultation
Every 2-3 weeks depending
upon concerns.
Academic
Registrar (AR)
Requirements Resource com-
mitments, status
Workshops with team, e-mails Frequent in early stages then
timed to delivery points.
Lecturers Concerns Plans, changes to
practices affect-
ing them
Program newsletter, presenta-
tions, e-mails
Monthly
Student support Requirements Resource com-
mitments, status
Workshops with team, e-mails Frequent in early stages then
timed to delivery points
Students Concerns Changes to
enrollment
procedures
Social media, e-mails,
presentations
E-mail and meetings
192 Part 2 Leading Projects
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communicate project successes and failures from all aspects of the project process. Captured
throughout the life of the project, recommendations to improve future performance can be
based on technical, managerial, and process aspects of the project. In addition, part of the
project closeout process should include facilitating a lessons learned session for the entire
project, especially on unsuccessful projects. Remember, “people learn, not organizations. …
Knowledge is created and exchanged through trusted relationships and social interaction.”11
6-6 Manage Communications
Manage communications includes all the work associated with the project communica-
tions plan, starting with planning for it; generating it; organizing and sharing it; and, finally,
storing and disposing of it. In order to successfully communicate the right project informa-
tion to the right stakeholders, in the right format, at the right time, several things must hap-
pen. First, all of the information required to develop the project communications
management plan should be assessed and obtained. Then, while the project is under way,
the project manager and team need to determine any additional information needs not
already uncovered, establish an information retrieval and distribution system, collect infor-
mation on executed work and work in progress, and then report progress to all stakeholders.
6-6a Determine Project Information Needs
Many stakeholder information needs were identified during communications planning,
such as authorization to proceed, direction setting, status reporting, and approval of out-
puts. Often, other information needs arise during project execution. All needs must be han-
dled accurately, promptly, and in a manner that balances effectiveness with cost and effort.
Communicate accurately—Accurate communications means not only being factually
honest but also presenting information in a manner that people are likely to inter-
pret correctly.
Communicate promptly—“Promptly” means providing the information soon
enough so that it is useful to the recipient to facilitate timely decisions.
Communicate effectively—Effectiveness is the extent to which the receiver opens,
understands, and acts appropriately upon the communication.
It is very easy to just copy everyone on an e-mail, but that is neither convenient nor
effective for some people. Face-to-face communication tends to be the most effective, the
telephone less so, and e-mail and formal reports even less. It is in the project manager’s
best interest to communicate effectively since the information provided allows stake-
holders to make decisions, understand real challenges, remain motivated, and believe
that the project is in control.
6-6b Establish Information Retrieval and Distribution System
Project information can be retrieved from many different sources. It can also be distrib-
uted via many systems. Project management software such as MS Project is frequently
used for schedule information and sometimes for cost and human resource information.
Project managers use many methods of communicating. In this information age, project
managers need to keep three things in mind with communications:
1. Target the communications. More is not better when people are already overloaded.
2. Many methods are available, and the choices change rapidly. Use new methods if use-
ful, but do not discard proven methods just for the sake of change.
Chapter 6 Stakeholder Analysis and Communication Planning 193
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AGILE
3. Projects often have many stakeholders who need specific information. Use your com-
munications plan and always keep asking if there is any other stakeholder in need of
upward, downward, or sideways communications.
Tatro, Inc., uses a hosted project management page on its website that clients can
access with a password to witness project progress from anywhere in the world on a
24/7 basis. It displays photos that show actual progress for the client to view.
One specific and important skill that project managers can use to retrieve information
is active listening. Active listening requires focus on what the person is saying. The active
listener can ask clarifying questions and paraphrase to ensure that he or she understands
exactly what is meant. Making eye contact and using body language that shows eagerness
encourage the speaker to continue. An effort to simultaneously understand both the
meaning of the message and the hidden emotions helps the receiver to understand the
full message. Recognize that many speakers are not especially skilled in communications,
so paying more attention to their message than their style of delivery also helps. Often, a
project manager can successfully end the conversation by orally confirming what he or
she just heard and by following up with an e-mail for documentation.
6-6c Project Meeting Management
Planning and conducting projects require a variety of meetings, such as meetings to:
Establish project plans
Conduct the project activities
Verify progress
Make decisions
Accept deliverables
Close out projects
Meetings are an important process on projects since many important decisions are
made at meetings and much time of expensive project personnel is invested in meetings.
One common feature of Agile projects is the “stand-up meeting.” These short (15 minute
or less) meetings are often held at the start of each day with no comforts such as coffee
or chairs. Each project team member briefly states what she accomplished the previous
day, what she plans to accomplish this day, and what obstacles may challenge her.
Project meetings should be conducted as efficiently and effectively as possible. One
way to improve the project meeting process is to apply the simple and effective plan-
do-check-act (PDCA) model.
PDCA MODEL The idea behind process improvement with the PDCA is that any pro-
cess practiced repeatedly, focusing on reusing and adapting things that worked well and
avoiding things that did not work well, improves over time. Exhibit 6.10 depicts the
PDCA model as it is applied to project meetings. Each of the four sections will be
explained in more detail in the following sections, but, in short, this model gives advice
on how to do the following for meetings:
P Plan: prepare an advanced agenda to guide the meeting
D Do: conduct the meeting and write meeting minutes
C Check: evaluate the meeting and
A Act: perform in-between meeting tasks.
194 Part 2 Leading Projects
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PROJECT MEETING AGENDA TEMPLATE When applying the PDCA improve-
ment model specifically to improving project meetings, the first step is planning the
project meeting in advance. The project manager assures that the agenda is prepared
and distributed ahead of time. If a project team is meeting often, this advance agenda
EXHIBIT 6.10
PDCA MODEL APPLIED TO PROJECT MEETINGS
prepare
advance agenda
conduct
meeting, write minutes evaluate meeting
perform
in-between
meeting tasks
Source: Adapted from Timothy J. Kloppenborg and Joseph A. Petrick, “Meeting Management and Group Character
Development,” Journal of Managerial Issues (Summer 1999): 168–172.
w
av
eb
re
ak
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ed
ia
/S
hu
tte
rs
to
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om
Chapter 6 Stakeholder Analysis and Communication Planning 195
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preparation may be done at the end of the meeting for the next meeting. That
way, everyone understands beforehand what will be covered in the upcoming meeting
and will have the opportunity to prepare for the meeting. The agenda also can
be helpful in deciding whether to invite a particular subject matter expert (SME)
or other guest to the meeting. A project meeting agenda template is shown in
Exhibit 6.11.
The top part of the agenda contains meeting logistics. The second item on the tem-
plate is the meeting purpose. If a project manager cannot state in a sentence why he
wants to conduct a meeting, perhaps the meeting is not necessary. The main body of
the agenda has three columns. First is a list of the topics. This starts with a quick
review of the agenda, because projects often move quickly, and this provides an
opportunity to add or delete an item from the agenda. Also, it helps busy people rush-
ing from another meeting to manage their time and focus on relevant agenda items.
The major topics of the meeting are listed next in the order in which they will be
covered. Often, remaining items from previous meetings or other urgent matters top
the list. However, a project manager wants to be sure to cover the most important
matters, even if they may not have the same sense of urgency. The second-to-the-last
item on the standard agenda is the meeting summary. The project manager sum-
marizes major decisions that were made as well as work assignments that were distrib-
uted. This helps people remember what they agreed to do. The final item on the
agenda is an evaluation of the meeting. This is explained in the check step of the
PDCA model.
The second column lists the person responsible for each topic on the agenda. Typi-
cally, the project manager takes care of the meeting start and close, but individual project
team members may be assigned specific action items. When people know in advance that
they are responsible for an action item, they are more likely to be prepared. Additionally,
if the advance agenda is available for key stakeholders to see, some of the stakeholders
may contact the responsible person in advance to provide input. This is a good way to
keep stakeholders engaged.
The third column is a time estimate for each item. While the project manager does
not need to be a slave to the clock, recognition of how long team members are in
EXHIBIT 6.11
PROJECT MEETING AGENDA TEMPLATE
Project Team PlaceTimeDate
Topic 1
Topic 2
Topic 3
Review agenda
Summary
Meeting evaluation
2 min
2 min
5 min
196 Part 2 Leading Projects
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meetings and how many items are accomplished goes a long way. People are more likely
to attend a meeting if they are sure it will end on time.
PROJECT MEETING MINUTES TEMPLATE The second step in the PDCA process—
“do”—means to conduct the meeting and to capture minutes as the meeting is con-
ducted. Many project teams rotate the role of minutes taker so each team member feels
equal. A template for taking project minutes is shown in Exhibit 6.12.
6-6d Issues Management
The project minutes mirror the agenda to the extent that both refer to the same meeting.
The top part of the minutes form is logistics, just as in the agenda. The four primary
types of information captured in a project meeting are:
1. Decisions made
2. New issues surfaced and old issues resolved
3. Action items agreed to
4. An evaluation of the meeting
DECISIONS AND ISSUES First, any decisions that were made should be documented.
Second, any new issues that surfaced or existing issues that were resolved should be
recorded. An issue is a situation that requires a decision to be made, but one that the
team cannot make now, usually either due to needing information or more time. An
issues log is a dynamic repository of information regarding both open issues and those
that have been resolved. Issues logs benefit a project in at least two ways. First, when
an important issue—but not one that can be solved in the immediate meeting—is intro-
duced, the project manager can add it to the open issues and not spend time on it in the
EXHIBIT 6.12
PROJECT MEETING MINUTES TEMPLATE
Resolved Issues
New Issues
Project Team TimeDate
Chapter 6 Stakeholder Analysis and Communication Planning 197
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AGILE
current meeting when more pressing matters need to be settled. Second, the issues
log ensures that important issues are not forgotten. An issues log template is shown in
Exhibit 6.13.
ACTION ITEMS The third type of project information is action items. Each of these is
a task that one or more members of the project team agree to perform by a specific date.
These are recorded, and the project manager reminds the team at the end of each meet-
ing what each member agreed to do.
EVALUATION The final item to be recorded on the project meeting minutes is an
evaluation of both good points from the project meeting that the team would like to
repeat or at least adapt and poor points from the meeting that the team would like to
avoid or perform in a different manner in the future. An experienced team can collect
these points in a minute or two; the time they save in future meetings often pays great
dividends. An easy way to capture these evaluations is a Plus-Delta template, as shown
in Exhibit 6.14.
On Agile projects, this evaluation is called retrospectives.
When assessing the project meeting with a Plus-Delta method, a project manager can
simply draw the form on a flip chart or marker board. Then, each person is asked to
offer his opinion on at least one aspect of the meeting that either was good (+) that she
would like to see repeated or one thing that was poor ( ) and could be overcome in
future meetings. The key to making this work for the project manager is how she
responds to any deltas. If the project manager responds defensively, the team members
may not want to offer further suggestions.
EXHIBIT 6.13
PROJECT ISSUES LOG
OPEN ISSUES
NAME DATE OPENED ORIGINATOR POTENTIAL IMPACT PROGRESS
CLOSED ISSUES
NAME DATE OPENED ORIGINATOR HOW RESOLVED DATE CLOSED
198 Part 2 Leading Projects
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Finally, the “act” part of the PDCA cycle for project meetings is for every team mem-
ber to complete the action items they promised and for the project manager to commu-
nicate with the team members to make sure nothing is holding them back from their
commitments. Wise project managers keep active but informal contact with team mem-
bers between meetings to ensure action items are completed on time. When all steps of
the PDCA cycle are applied to project meetings, the meetings improve; the team mem-
bers gain satisfaction; and the project makes better progress.
PMP/CAPM Study Ideas
There is a great deal of overlap between Project Communications Management and Proj-
ect Stakeholders Management. Each edition of the PMBOK makes changes with and
between these two groups, so be sure you are using the sixth edition if you are studying
for one of the PMI certification tests. Besides developing the project charter—which is
like a mini pre-plan that gives the project manager and team the authority to begin plan-
ning in more detail—the only other activity that takes place during the Initiating Process
Phase is Identify Stakeholders.
The main work of the next phase—the Planning Process Group—is creating the Proj-
ect Management Plan. The project management plan is the aggregate of plans from each
of the ten knowledge areas, including the Communications management plan and Stake-
holders Management Plan. As always, you will need to be familiar with the inputs, tools
and techniques, and outputs that go into each.
EXHIBIT 6.14
PROJECT MEETING PLUS-DELTA EVALUATION TEMPLATE
Summary
Projects frequently have many diverse stakeholders.
Some stakeholders do not know exactly what they
want, and different stakeholders sometimes want dif-
ferent things. The project manager and sponsor need
to build effective working relationships with the project
team and stakeholders. When good relationships are
built and maintained, the project team can enjoy the
trust that is so helpful in successfully completing the
project.
Armed with the stakeholder analysis and the project
charter, a project team is ready to create a communica-
tions management plan. One important component of
Chapter 6 Stakeholder Analysis and Communication Planning 199
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this plan is the communications matrix. This is the
document that answers these questions:
Who needs to know something about the project?
What does each need to know?
When do they need to know it?
What format is easiest for them to receive and
understand the information?
Who is responsible for sending it?
Other important aspects of a project communica-
tions management plan include managing and improv-
ing meetings; managing and escalating issues; and
capturing and using lessons learned.
Once stakeholders have been analyzed and communi-
cations are planned, the project team can get into more
detailed planning of scope, schedule, resources, budget,
risks, and quality—the topics of the next six chapters.
Key Terms Consistent with PMI Standards and Guides
identify stakeholders, 179
stakeholder analysis, 180
stakeholder register, 183
plan stakeholder engagement, 184
stakeholder engagement plan, 184
stakeholder engagement assessment matrix, 184
manage stakeholder engagement, 186
monitor stakeholder engagement, 197
plan communications management, 188
communications matrix, 191
knowledge, 192
manage project knowledge, 192
manage communication, 193
issue, 197
issues log, 197
Chapter Review Questions
1. List three reasons why understanding stakeholders
is important to successful project management.
2. What is the difference between an internal and
external stakeholder?
3. Which three criteria should you consider when
prioritizing stakeholders?
4. When should relationship building between the
project manager/other core team members and
important stakeholders occur?
5. What are some ways to build relationships within
the core team?
6. What are some ways to build relationships with
key stakeholders?
7. What are some important functions of commu-
nication from stakeholders?
8. What are some important functions of commu-
nication to stakeholders?
9. In order to manage stakeholders’ expectations, a
project manager needs to understand the stake-
holders’ assumptions. Which document(s) can
help with this?
10. What is the difference between “push” and “pull”
methods of communication? Give examples of
each.
11. What are three types of project communications
timing schedules?
12. What six columns should a communications
matrix contain?
13. Why is it so important to capture lessons learned
in a knowledge database?
14. List the items that go into a project team meeting
agenda and tell the purpose of each.
15. Describe an Agile “stand-up” meeting.
Discussion Questions
1. A new grocery store is being erected that
will demolish a neighborhood basketball court.
Who would be some internal stakeholders?
Who would be some external stakeholders?
2. With a few of your classmates, conduct an Agile
stand-up meeting and briefly discuss the three
meeting components mentioned in this chapter.
3. Think of a recent project you completed and
choose three stakeholders. Prioritize them, using
the six-criteria model.
4. In your opinion, what is the single most impor-
tant component of building relationships within
a project team? Why?
200 Part 2 Leading Projects
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5. In your opinion, what is the greatest benefit of
having good communication between the project
team and project stakeholders? Why?
6. Imagine you are the project manager of a team
tasked with building a new hotel. When brain-
storming project communication plan considera-
tions, what would you list under “purposes”?
7. Using the same scenario as question 6, which
timing schedule would you choose to use for
each communication? Why?
8. Create a project meeting agenda for an upcoming
project (or class) meeting you have.
9. Give an example of a time you have used push,
pull, and interactive communication methods.
Why did you choose the method you did based
on the circumstances?
10. Betty, a project manager, sent out agendas before
an upcoming meeting to everyone involved.
During the meeting, she got a team member to
take minutes. After the meeting, Betty followed
up with team members to check on their prog-
ress. Evaluate Betty’s actions using the PDCA
model. What, if anything, could she have done
better?
PMBOK ® Guide Questions
1. The “component of the project management plan
that describes how project communications will
be planned, structured, and monitored” is the:
a. communication model
b. communications management plan
c. stakeholder register
d. organizational breakdown structure
2. In order for a new grocery store to be erected, a
neighborhood basketball court located on the
building site will have to be demolished. The
neighborhood children who liked to play basket-
ball there could be considered .
a. subject matter experts
b. internal stakeholders
c. external stakeholders
d. customers
3. A common method of prioritizing stakeholders is
based on the stakeholders’:
a. legitimacy
b. power
c. urgency
d. all of the above
4. The components of a project communications
management plan should typically include the
purpose of the communication, structure (for-
mat, content, etc.), methods or technologies to
be used, and :
a. work performance data
b. time frame and frequency
c. stakeholder priorities
d. lessons learned
5. Most project meetings are formal, planned events
between project stakeholders. Effective meetings
typically have a purpose, a prearranged time and
place, a list of attendees and their roles, and an
agenda with topics and issues to be discussed.
After the meeting, are circulated.
a. refreshments
b. business cards
c. meeting minutes
d. lessons learned
6. The “project document that includes the identifi-
cation, assessment, and classification of project
stakeholders” is called the .
a. stakeholder engagement matrix
b. organizational breakdown structure
c. stakeholder register
d. weighted scoring model
7. A document used to manage points of discussion
or dispute that arise during projects, in order
to monitor them and ensure that they are even-
tually resolved and added to lessons learned, is
called a(n) .
a. risk register
b. stakeholder register
c. SWOT analysis
d. issue log
8. One of the key responsibilities of a project man-
ager is to manage stakeholder expectations. It is
important for the project manager to have inter-
personal or “soft” skills that include: overcoming
resistance to change, resolving conflict, active lis-
tening, and .
a. displaying confidence
b. subject matter expertise
c. ability to command and control
d. building trust
Chapter 6 Stakeholder Analysis and Communication Planning 201
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9. The process of communicating with stakeholders
and working with them to meet their expecta-
tions, address issues as they occur, and obtain
their continued commitment to the success of
the project is called .
a. Manage Stakeholder Engagement
b. Monitor Stakeholder Engagement
c. Monitor Communications
d. Manage Project Team
10. The communication method that is used for large
audiences or large volumes of information and
requires recipients to access the content at their own
discretion, is called communication.
a. push
b. pull
c. synchronous
d. interactive
CASA DE PAZ DEVELOPMENT PROJECT
In this chapter, the first thing we need to do is understand
who our stakeholders are and the importance of each set of
stakeholders. The initial look at stakeholders is shown in the
matrix below.
Once we have our stakeholder priority matrix, we will
ask each stakeholder what they want from this project.
We will then use that information to develop a commu-
nications matrix showing for each stakeholder what they
need to know from the project team and what they
need to share with the project team, along with the most
effective methods and times for these communications
to take place and who on the project team is respon-
sible for each communication. We will also develop
meeting agendas, minutes, issues logs, and meeting
evaluations.
In Agile, the role of communication with stakeholders is
much more formalized to enable the team to focus on the
work. The product owner is the primary contact for all stake-
holders and acts as a buffer between stakeholders and team
members while the iteration is under way. The ceremonies in
some Agile approaches act as a time for the stakeholders to
see the progress and make comments.
I N T E G R A T E D E X A M P L E P R O J E C T S
SUBURBAN HOMES CONSTRUCTION PROJECT
Suburban Homes realizes the importance of maintaining
excellent relations with all its key stakeholders. Among the
stakeholders are clients who purchase homes, local law
enforcement agencies, potential buyers, county and state
agencies for real estate development, environmental regula-
tory agencies, both local and federal, community leaders,
contractors, subcontractors, local construction material sup-
pliers, and the list goes on.
Suburban Homes decided to build a new community of
120 homes in a suburb of Atlanta. It has acquired 15 acres
of land for this purpose. It also has submitted a preliminary
plan to the local county government for approval.
Suburban Homes is thinking of hiring a consultant
for developing a stakeholder management plan and
communication plan. For its stakeholder management plan,
they would like to identify all the stakeholders and develop
a stakeholder register. Further, it is considering selection of
at least six key stakeholders for a detailed analysis of a priori-
tization matrix, as shown Exhibit 6.2, and to develop a stake-
holder matrix, as shown in Exhibit 6.4.
As a consultant to Suburban Homes, you are asked to
develop a stakeholder engagement plan (Exhibit 6.5) and a
comprehensive stakeholder management plan after develop-
ing the stakeholder prioritization matrix and stakeholder
matrix, as shown in Exhibits 6.2 and 6.4, respectively.
Using the stakeholder management plan, the company
has also requested you to develop a communication plan
that makes use of Exhibits 6.8 and 6.9.
202 Part 2 Leading Projects
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Semester Project Instructions
Do each of the following for your project:
Develop a stakeholder analysis. Identify as many
stakeholders as you can using Exhibit 6.1. List sta-
keholders by name and title where possible.
Prioritize the listed stakeholders, as shown in
Exhibit 6.2.
Specifically identify each stakeholder’s interests, as
shown in Exhibit 6.4. Recognize that some stake-
holders may have an interest in multiple aspects of
the project process or results.
Describe the activities you are using to build rela-
tionships with your stakeholders.
Create a stakeholder engagement matrix like
Exhibit 6.5.
Develop a communications matrix like Exhibit 6.9.
Be sure to use considerations in Exhibit 6.8 for
ideas regarding purpose, structures, methods, and
timing for each communications need.
Document a project meeting with an advance
agenda, meeting minutes, issues log, and Plus-
Delta form of evaluation like Exhibits 6.11 through
6.14.
Stakeholder Prioritization
Project: Casa de Paz
Stakeholder Power Legitimacy Urgency Total
Parish Council 5 5 4 14
Casa de Paz Staff 5 5 4 14
Board Members 5 5 3 13
Community Council 3 5 4 12
Casa de Paz Volunteers 2 4 4 10
Residents/Future Residents of Casa de Paz 1 5 4 10
Members of Phoenix Support Group 1 5 4 10
Donors 2 3 4 9
Student Interns 2 4 2 8
Su Casa (who also serves sme community 1 5 1 7
YWCA 1 5 1 7
Protective Services 1 5 1 7
1 5 1 7
Chapter 6 Stakeholder Analysis and Communication Planning 203
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PROJECT MANAGEMENT IN ACTION
Project Communication Planning for a Distributed Project
During an IT rollout of servers, clients, networking equipment, and a central data center involving a range of
subcontractors at each of the roughly 50 regional schools, the original communication plan showed:
Original communication plan
After being appointed PM for rollout and implementation, I noticed that this was far from enough and needed to
be amended.
Revised communication plan
Main contractor
Subcontractor 1
Subcontractor 2
Subcontractor N
School 1
School 2
School N
Joint edu association
or
administration union
Subproj 1
Subproj 2
Subproj 50
Joint edu association
or
administration union
School 1
School 2
School N
Team Team
Team
Team
Team
Team
Team
Team
Team
Co
re
te
am
Main contractor
(bundling crafts and trades)
Subcontractor 1
Subcontractor 2
Subcontractor N
204 Part 2 Leading Projects
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First of all, two on-site visits at each location were
introduced in order to
1. get to know the location and the people involved
and
2. make sure all environmental preconditions agreed
upon had been properly set up.
For each location, there were between 5 and 20
people involved who all needed special information
(depending on their role), thus multiplying the
planned effort of communication considerably. How-
ever, the still early discovery of the complex stake-
holder situation also facilitated a degree of fast-
tracking and intensifying the cooperation, which was
essential to finalize the project in quality, time, and
budget, despite several buffer-consuming events,
with very favorable media coverage and proper proj-
ect close, which otherwise would have been
impossible.
Apart from the headmaster and IT teacher, what
other roles did we discover ?
All teachers whose classrooms were involved
(receiving equipment, have to move/exchange fur-
niture, rearrange the room).
Caretaker (usually the one who knew about walls,
wires, changes to the building, and the construc-
tion history where there were no drawings
available).
Owner of the building (community, private owner,
society).
Sponsor for each individual school (who had to
agree to a detailed plan and a float sum of
money. This was quite a topic since originally it
was thought that a float lump sum of money
could be spent on the whole project moving
money between sites according to need. The
need differed greatly since a newly build school
(concrete/steel) poses a whole different range of
tasks as compared to 150-year-old converted cas-
tle schools with thick walls (think of wireless LAN,
think of protection of historical monuments =
no drilling of holes anywhere and a long analysis
and certificates for every little change to the build-
ing, think of moist or even wet intended server
locations).
The schools all had preferred local partners for elec-
tricity (dedicated electrical phases for 19 server,
power supply and network equipment, ideally dry
and ventilated and cool, usually a small moist place
with no air flow at all like a broom closet of the
Harry Potter type in Privet Drive).
Structural fire protection authority (they had seri-
ous words for the people who suggested drilling
through a bulkhead firewall).
Regional politicians who support the improve-
ment of learning environments.
Media who supported the project in terms of
regional development and marketing the initiative
to improve education and bring up-to date learn-
ing facilities also to the more rural areas.
And not to forget the neighborhood and espe-
cially the parents (in particular, the ones less IT
enthusiastic) who needed a good portion of con-
vincing that this was something big and essential
to their kids development and future chances.
What finally saved the project?
1. Initial core team brainstorming and proper stake-
holder analysis (no matter whether according to
PMI, IPMA, or PRINCE2, list them all, check their
expectation, interests, influence, power, degree of
potential support, and involvement).
2. Two alternative Meetings informing all interested
parties (obligatory to certain stakeholders and
open to the public and invited media), so everyone
KNEW, everyone received a roughly 50-page hand-
out with detailed plans and intentions, involvement
of all relevant parties, order of steps, phases of
progress, ways of communication, etc.
3. A short pilot consisting of 8 schools, 2 schools
of every one of the 4 different types (primary/
small, secondary/middle, gymnasium/large, special
needs) helped us group the remaining location in
mixed regional groups for each rollout team.
Scheduling the whole procedure was a challenge
because due to different sizes and varying numbers
of equipment, totally different buildings, etc., there
was no chance to cut everything into weekly time
boxes à la sprints in Agile scrum. Instead, every
team had their own stream of tasks, consisting of
nearly the same steps, however, with independent
underlying amounts of effort.
4. At virtually every first on-site visit, someone unex-
pected played a vital role (relevant for interdepen-
dency of activities, e.g., schedule, cost, resources,
communication, risks, basically the whole range of
Chapter 6 Stakeholder Analysis and Communication Planning 205
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References
A Guide to the Project Management Body of Knowledge
(PMBOK® Guide), 6th ed. (Newtown Square, PA:
Project Management Institute, 2017).
Aaltonen, Kirsi, et al., “Stakeholder Dynamics During
the Project Front-End: The Case of Nuclear Waste
Repository Projects,” Project Management Journal
46 (6): 15–41.
Alderton, Matt, “What’s Your Number?” PMNetwork
26 (12) (December 2012): 48–53.
Anantatmula, Vittal, and Michael Thomas, “Managing
Global Projects: A Structured Approach for Better
Performance,” Project Management Journal 41 (2)
(April 2010): 60–72.
Assudani, Rashmi, and Timothy J. Kloppenborg, “Man-
aging Stakeholders for Project Management Success:
An Emergent Model of Stakeholders,” Journal of
General Management 35 (3) (Spring 2010): 67–80.
Badiru, Adedeji B., Triple C Model of Project Man-
agement: Communication, Cooperation, and Coor-
dination (Boca Raton, FL: CRC Press, 2008).
Basten, Dirk, Georgios Stavrou, and Oleg Pankratz,
“Closing the Stakeholder Expectation Gap: Manag-
ing Customer Expectations Toward the Process of
Developing Information Systems,” Project Manage-
ment Journal 46 (6): 70–88.
Bourne, Lynda, and Derek H. T. Walker, “Visualizing
Stakeholder Influence: Two Australian Examples,”
Project Management Journal 37 (1) (March 2006): 5–21.
Daft, Richard L., Management, 9th ed. (Mason, OH:
South-Western Cengage Learning, 2010).
Eskerod, Pernille, Martina Huemann, and Claudia
Ringhofer, “Stakeholder Inclusiveness: Enriching
Project Management with General Stakeholder
Theory,” Project Management Journal 46 (6): 42–53.
Fleming, John H., and Jim Asplund, Human Sigma
(New York: Gallup Press, 2007).
Goodpasture, John C., Project Management the Agile
Way: Making It Work in the Enterprise (Fort Lau-
derdale, FL: J. Ross Publishing, 2010).
Kloppenborg, Timothy J., and Joseph A. Petrick,
“Leadership in Project Life Cycles and Team Char-
acter Development,” Project Management Journal 30
(2) (June 1999): 8–13.
Kloppenborg, Timothy J., and Joseph A. Petrick,
“Meeting Management and Group Character
Development,” Journal of Managerial Issues (Sum-
mer 1999): 140–159.
Montoya, Mitzi M., Anne P. Massey, Yu-Ting Caisy
Hung, and C. Brad Crisp, “Can You Hear Me Now?
Communication in Virtual Product Development
Teams,” Journal of Product Innovation Management
26 (2009): 139–155.
Montoya, Mitzi M., Anne P. Massey, and Vijay Khatri,
“Connecting IT Services Operations to Services
Marketing Practices,” Journal of Management
Information Systems 26 (4) (Spring 2010): 65–85.
PM topics), we (the project core team on whistle-
stop tour, usually four to five people) explained
everything we said at the two kickoff meetings
again, answered more questions, and made clear
that local support according to schedule was vital,
and deliberately failing to meet deadlines meant
moving down the list and along the time line.
5. During the second on-site meeting, we checked the
preconditions ready and if so delivery and setup
of IT equipment were approved, if not another
school from further down the list was invited to
move up if they met the criteria.
6. Every piece of equipment had a checklist, all func-
tions were tested and ticked off by a technician and
a school representative reporting status green,
which automatically approved the final steps includ-
ing training of staff on-site by the same technicians
who worked on-site the 1 2 weeks beforehand.
Bear in Mind:
1. Have a plan. You need to follow a systematic
approach throughout the project.
2. Employ structured Information.
3. Pilot what you do.
4. Communicate face to face on site.
5. Have clear rules.
6. Have a realistic time line, including buffers for all
sorts of risks and additional stakeholder involve-
ment wherever necessary.
Source: Martin Kontressowitz.
206 Part 2 Leading Projects
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Mueller, Ralf, and J. Rodney Turner, “Cultural Differ-
ences in Project Owner–Project Manager Commu-
nications,” Innovations Project Management
Research 2004 (Newtown Square, PA: Project Man-
agement Institute, 2004): 403–418.
Patanakul, Peerasit, Bookiart Iewwongcharien, and
Dragan Milosevic, “An Empirical Study of the Use
of Project Management Tools and Techniques
across Project Life-Cycle and Their Impact on
Project Success,” Journal of General Management 35
(3) (Spring 2010): 41–65.
Shelley, Arthur, KNOWledge SUCCESSion: Sustained
Performance and Capability Growth Through Stra-
tegic Knowledge Projects (New York: Business
Expert Press, 2016).
The Standard for Program Management, 3rd ed. (New-
town Square, PA: Project Management Institute, 2013).
Turkulainen, Virpi, Kirsi Aaltonen, and Paivi Lohikoski,
“Managing Project Stakeholder Communication: The
Qstock Festival Case,” Project Management Journal
46 (6) (December 2015/January 2016): 74–91.
Yang, Rebecca, Yaowu Wang, and Xiao-Hua Jin, “Sta-
keholder’s Attributes, Behaviors, and Decision-
Making Strategies in Construction Projects: Impor-
tance and Correlations in Practice,” Project Man-
agement Journal 46 (6): 74–90.
Young, R. Ralph, Steven M. Brady, and Dennis C. Nagle,
Jr., How to Save a Failing Project: Chaos to Control
(Vienna, VA: Management Concepts, 2009).
Endnotes
1. Turkulainen, Virpi, Kirsi Aaltonen, and Paivi
Lohikoski, “Managing Project Stakeholder
Communication: The Qstock Festival Case,”
Project Management Journal 46 (6) (December
2015/January 2016): 76.
2. Eskerod, Pernille, Martina Huemann, and Claudia
Ringhofer, “Stakeholder Inclusiveness: Enriching
Project Management with General Stakeholder
Theory,” Project Management Journal 46 (6): 45.
3. Yang, Rebecca, Yaowu Wang, and Xiao-Hua Jin,
“Stakeholder’s Attributes, Behaviors, and
Decision-Making Strategies in Construction Pro-
jects: Importance and Correlations in Practice,”
Project Management Journal 46 (6): 78–79.
4. Bourne, Lynda, and Derek H. T. Walker, “Visu-
alizing Stakeholder Influence: Two Australian
Examples,” Project Management Journal 37 (1)
(March 2006): 5–21.
5. Aaltonen, Kirsi, et al., “Stakeholder Dynamics Dur-
ing the Project Front-End: The Case of Nuclear
Waste Repository Projects,” Project Management
Journal 46 (6): 28.
6. Adapted from John H. Fleming and Jim Asplund,
Human Sigma (New York: Gallup Press, 2007): 97.
7. Basten, Dirk, Georgios Stavrou, and Oleg Pank-
ratz, “Closing the Stakeholder Expectation Gap:
Managing Customer Expectations Toward the
Process of Developing Information Systems,”
Project Management Journal 46 (6): 76.
8. Badiru, Adedeji B., Triple C Model of Project Man-
agement: Communication, Cooperation, and Coor-
dination (Boca Raton, FL: CRC Press, 2008): 29.
9. Alderton, Matt, “What’s Your Number?” PMNet-
work 26 (12) (December 2012): 48–53.
10. Daft, Richard L., Management, 9th ed. (Mason, OH:
South-Western Cengage Learning, 2010): 631.
11. Shelley, Arthur, KNOWledge SUCCESSion: Sus-
tained Performance and Capability Growth Through
Strategic Knowledge Projects (New York: Business
Expert Press, 2016): 18.
Chapter 6 Stakeholder Analysis and Communication Planning 207
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3
ORGANIZE LEAD PERFORMPLAN
P A R T 3
PLANNING PROJECTS
Chapter 7
Scope Planning
Chapter 8
Scheduling Projects
Chapter 9
Resourcing Projects
Chapter 10
Budgeting Projects
Chapter 11
Project Risk Planning
Chapter 12
Project Quality Planning and
Project Kickoff
Planning is a large and critical part of project manage-
ment. Planning may be largely completed before much
executing work begins in traditional project manage-
ment, in a completely iterative fashion using Agile, or
somewhere in between in a hybrid environment. Project
planning tends to be collaborative with many people
involved and integrative in that many factors need to be
considered. That said, we cover the various aspects of
planning in distinct chapters to clarify what needs to be
done in each. Chapter 7 shows how to plan the scope by
collecting requirements and creating work breakdown
structures. Chapter 8 shows how to create and commu-
nicate project schedules. Chapter 9 follows closely by
resourcing projects and dealing with overloaded workers
and the frequent need to compress schedules.
Chapter 10 shows how to create a time-phased project
budget that will be used for control. Chapter 11 covers
details of identifying, assessing, and dealing with a myr-
iad of project risks. Finally, Chapter 12 deals with quality
planning and with integrating all parts of the schedule
into a single coherent whole.
209
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C H A P T E R 7
Scope Planning
You re browsing a favorite retailer s website and you notice the onscreen recom-
mendations are just right for you. The site seems to know what you ve bought
before. This great customer service is enabled by the retailer s web intelligence
solution from Teradata.
Teradata is the world s largest company focused solely on enterprise data ware-
housing and analytic solutions. The simple web-shopping scenario is just one exam-
ple of how our customers use information to improve their relationship with you.
So what does this have to do with project scope management? In this example,
the retailer purchased a Teradata solution that included hardware, software, and a
consulting project for the implementation. Teradata implemented this project based
on our experience and a methodology built upon a foundation of scope management.
We can manage scope in various ways ranging from traditional waterfall to
Agile approaches to deliver the right solution in an effective manner.
The first step in project scope management is to mutually agree on what the
project will deliver, or in the case of Agile, what we will focus on. In our example,
the retailer needed to integrate data from their web analytics software, an
in-house customer relationship system, and other sources. They also had require-
ments for reports and the technical integration with their IT infrastructure. The
CHAPTER OBJECTIVES
After completing this
chapter, you should
be able to:
CORE OBJECTIVES:
Describe the planning
of scope manage-
ment, collecting
requirements, and
defining scope
processes.
Create a require-
ments traceability
matrix, project scope
statement, and
change request form.
Describe a work
breakdown structure
(WBS) and its impor-
tance to project
planning and control.
Compare different
methods of develop-
ing a WBS.
TECHNICAL OBJECTIVE:
Create a WBS,
including work
packages and a
numbering system for
the code of accounts,
both by hand and
using MS Project.
Ra
w
pi
xe
l.c
om
/S
hu
tte
rs
to
ck
.c
om
210
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Teradata team elicited requirements in a way that uncovered what the customer
really needed.
Projects often use a statement of work (SOW) or similar document to outline the
high-level scope. In a Teradata project, this is part of our customer contract. We then
elaborate on more detailed requirements in a traceability matrix. This ensures all
requirements tie end to end from the contract through project testing and cus-
tomer acceptance. The time spent up front in requirements management pays divi-
dends during project testing and customer acceptance, where discovering unknown
requirements is much more time consuming and expensive.
Teradata follows traditional project management practice to develop a work break-
down structure (WBS) as the basis for a detailed project schedule and resource plan.
We typically use Microsoft Project as a scheduling tool; a plan based on the WBS
makes it easy to track and communicate the status of each deliverable.
Finally, the entire set of requirements is managed under change control. This
is an important process, because the team must balance control and flexibility.
We also must meet (or agree to change) the project cost and schedule para-
meters. Our project manager facilitates an analysis of the technical, schedule,
and cost impact, and then all parties reach an agreement on how to proceed.
This simple example illustrates how the Teradata project methodology builds
upon a foundation of scope management to deliver exactly what the customer
needs in the most efficient manner. An effective scope management approach
fosters open communications and sound decision making to ensure all parties
get the business value expected from the project.
Mike Van Horn, Teradata
7-1 Plan Scope Management
Once all the stakeholders for a project have been identified, the project team members
develop a scope management plan, assess project requirements, develop the project’s scope,
and create a work breakdown structure (WBS). These are the scope planning processes that
will be covered in this chapter. When planning scope, it is also wise to plan for changes.
While this is not technically part of scope planning, it will also be covered in this chapter
because accurate assessment of the client’s requirements can minimize scope changes, and,
to that extent, scope planning is an effective means to control changes to the project.
The flow of scope planning is illustrated in Exhibit 7.1. The boxes represent the proj-
ect work processes involved, and the documents shown before and after the boxes repre-
sent major inputs needed to perform the processes as well as major outputs created by
the work processes. Documents covered in previous chapters (Charter in Chapter 3 and
Stakeholder Register in Chapter 6) are needed inputs for the first two processes.
4.2 Develop Project Management Plan PM Plan
Baselines
5.5 Validate
Scope
5.6 Control
Scope
5.4 Create
WBS
Scope Baseline
with WBS
5.3 Define
Scope
5.2 Collect
Requirements
Requirements
Documents
5.1 Plan Scope
Management
Scope
Statement
PMBOK® GUIDE
Topics:
Plan scope
management
Collect requirements
Define scope
Create WBS
CHAPTER OUTPUTS
Requirements
documents
Scope statement
Scope baseline with
WBS
211
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AGILE
The first scope process, plan scope management, is the process of developing a plan
that includes the total scope of what needs to be done and what is excluded from the
project, implementation and validation of the scope, and control deviations from the
scope statement. The product scope describes features and functions of a project out-
come such as product, and, in some cases, service or result. The project team also
needs to determine the project scope, which is the work required to be performed for
delivering a product, service, or result with the required features and functions. Together,
the product scope (the outputs the team will deliver to its customers) and the project
scope (the work they need to perform to create the project’s outputs) form the total
scope. In other words, the project team members determine what they will do to ensure
they have identified and organized all the project work so they can use it as the basis of
all other planning activities and then as the basis for executing and controlling the proj-
ect work. For many projects, the client or the end user may not be concerned about the
project scope and may be interested only in the product scope.
The priority of the product in Agile is more significant than in traditional project man-
agement. The outcome, or the product, will drive the elaboration of the project. The end
state of the product is not predetermined. In Agile, we flip the 80/20 proposition on its
head and focus on the product 80 percent of the time and the project 20 percent. While
this model will not work in all project scenarios, it does work in projects in which the
main product is a creative, virtual result. Agile aligns to the needs of the customer. How-
ever, if an intermediary is managing scope and cost, the project manager needs to main-
tain alignment and remain focused on delivering value through the product.
7-2 Collect Requirements
A requirement is a condition or capability needed by a user to solve a problem or
achieve an objective that satisfies a standard, a specification, or any other formally docu-
mented need.
Collect requirements is a systematic effort to understand and analyze stakeholder
needs to define and document these needs and requirements with a focus on meeting
project objectives. The first step in collecting requirements is to ensure that the project
team is clear on the project objectives. This could be accomplished by reviewing the
EXHIBIT 7.1
SCOPE PLANNING FLOW
Plan Scope
Management
Scope
Management
Plan
Stakeholder
Register
Charter
Collect
Requirements
Define
Scope
Create
WBS
Perform
Integrated
Change Control
Approved
Changes and
Updates
Scope
Baseline
with WBS
Scope
Statement
Requirements
Traceability
Matrix
212 Part 3 Planning Projects
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AGILE
project charter—particularly the “why” section that justifies the project. The project team
members then may describe in more depth what each believes the expected project ben-
efits are and/or what problems the project is attempting to overcome. On simple pro-
jects, this may not take a lot of time. On complex projects, a project manager may
choose to use idea generation, grouping, and/or cause-and-effect techniques to make
sure that everyone on the project team understands why the project is being conducted.
Understanding broad project objectives will help in making more-detailed decisions later.
This also reinforces the project’s importance and may help motivate team members and
other stakeholders during challenging periods in project execution. It is especially useful
with multifunctional, virtual, and global project teams. Finally, a clear understanding of
the project’s objectives helps if the project plan needs to be revised at some point.
Collecting requirements is the same no matter what type of project approach you undertake;
however, in more iterative projects, the documentation of the requirement is normally much
less formal. Agile leverages the progressive elaboration mindset that allows for the project to
unfold before the implementation team. This works best when the expected outcome is
unclear or customers may change their mind once they see the initial product.
7-2a Gather Stakeholder Input and Needs
The second step is to gather input from the various project stakeholders. Needs assessment
begins with a high level of understanding of the client needs during the project inception.
A project manager is assigned and more detailed requirements assessment is done after a
project’s core team is selected. This core team size would depend on the nature of the proj-
ect and the number of disciplines required to plan and execute the project.
When a project manager and team listen closely to both internal and external customers,
they understand better both what their needs are and what risks and issues may confront
them during the project. Successful project managers know that for a project outcome to
be useful to the project’s customers, the customers need to be able to use the output to better
serve their own customers in turn. In other words, end-users of the project deliverable, the
product of the project, and their needs must be integral to the list of requirements.
The methods of developing deep understanding of customers and their needs vary
extensively from one industry to another. The traditional methods of obtaining and doc-
umenting requirements are many, such as:
Meetings with key stakeholders
Interviews
Focus groups
Questionnaires
Surveys
Observations
Prototypes
Industry standards
Reference documents,
Market analysis
Competitive analysis
Requests from the client
Standard specifications
For example, in new product development projects, teams often use voice of the cus-
tomer (VOC) techniques to elicit the benefits and features the customers want out of the
Chapter 7 Scope Planning 213
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project expressed in the customer’s language. Teams using VOC try to understand the
customer by not only asking questions but also by placing themselves in the customer’s
situation. If a project team is designing a new system that is to be used in the field,
the team member should get down in the mud with the mechanic and hand the
mechanic repair tools to see from the mechanic’s point of view how the new system
will be used.
Requirements can be classified as functional/technical and nonfunctional. The first
category is usually the focus of needs assessment exercises and is centered on perfor-
mance of the deliverable—such as the mechanic’s needs just described. The second cate-
gory includes requirements such as scalability, reliability, maintainability, and testability.
Once captured, these customer wants and needs are then stated in operational terms
that the people performing the project work can use to plan that work. If the customer
wants blue food coloring in a food item, the project team developing the item needs to
know the precise desired shade of blue, the quality grade, the tolerance for color varia-
tion, and how the blue color may interact with other ingredients.
The project manager wants to understand how a project’s success will be determined
from the customer’s perspective. The best way to gain this understanding (and to begin
building a strong relationship with customers) is to directly ask customers. The project
leaders can ask the customer(s) to specify how they will judge the quality of the project
based on both functional and nonfunctional requirements.
On an information systems project, the team may use a joint application design (JAD)
session to elicit customer requirements. This is often a facilitated session in which users
of the software should articulate their preferences regarding how the software should
work. The project manager and the team often send their understanding of the project
objectives and deliverables in advance to all the users so that they are better prepared to
discuss their needs and provide clarifications. Only one group of users is normally in this
meeting at a time, while the project manager and the technical workers are in the session
for its duration. Each possible feature of the system should be discussed. If the system is
large and complicated, the amount of time that can be spent per item may be scheduled.
Users often wish to talk in depth about how they want to use the system, while develo-
pers often want a detailed discussion about how they plan to create the feature. To avoid
sinking into too much detail, the project manger can ask the users to start with only a
high-level description of their reasons for the requested feature and then guide the dis-
cussion with the following five questions:
1. What do we not understand about the feature?
2. What is the business reason for the feature?
3. What is the impact of not providing this feature?
4. What action items need to be accomplished if we do this?
5. What impact will this have on other features of the project or elsewhere?
Exhibit 7.2 lists requirement along with other related information such as acceptance
criteria for each requirement, which can be either high level or very detailed (using speci-
fication in measurable terms). The requirement type suggests whether the requirement is
functional, nonfunctional, or needed by a particular stakeholder. The traceability matrix
also includes the status of the requirement, its priority, and who is responsible for the
requirement.
On some types of projects, the customers can provide their ideas using one of the
techniques above, and the project team can be confident that the customers’ wants and
needs have been captured. On other projects, once the customers’ viewpoint is captured,
it makes sense to create a model or prototype of some sort so the customers can decide if
their wishes have been fully and accurately captured. Often, this extra step helps the
214 Part 3 Planning Projects
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customers become more fully vested in the project and creates a strong working relation-
ship that is helpful when difficulties arise during project execution.
It is helpful to list requirements and their supporting information in a requirements
traceability matrix such as that shown in Exhibit 7.2.
EXHIBIT 7.2
REQUIREMENTS TRACEABILITY MATRIX
ID REQUIREMENT ACCEPTANCE CRITERIA TYPE STATUS
STAKE-
HOLDER
GROUP(S) PRIORITY OBJECTIVES
1 The BA must be able to
customize the information
collected for requirements
Stakeholder Approved BA Must PO#1
1.1 The system shall allow for
renaming of requirement
attributes
1. BA can rename an existing field
2. Field displays new name on input
forms
3. Field dispalys new name on reports
Functional Approved BA Must PO#1
1.2 The system shall allow new
requirement fields to be
identified
1. BA can add a new field
2. BA can set field attributes
3. BA can indicate field lookup values
4. Custom field available for input
5. Custom field available for reports
Functional Approved BA Should PO#1
1.3 The system shall allow for
lookup of allowable fields
for a requirements attribute
1. BA can enter custom list of lookup
value
2. Lookup fields can be provided
from an external system through
data interface
Functional Approved BA Should PO#1
2 The BA must be able to
provide different reports
for different audiences
Stakeholder Approved BA, Team,
Sponsor,
Stakeholders
Must PO#1
2.1 The system shall include a
base set of standard reports.
Reports include
1. Requirements Traceabilty Matrix
2. Business Requirements
Documents
Functional Approved BA, Team,
Sponsor,
Stakeholders
Must PO#1
2.2 The system shall allow a
business analyst to filter
reports based on various
requirement attributes
1. BA can filter report based on
a. Type
b. Stakeholder
c. Status
d. Priority
e. Objective
Functional Approved BA Must PO#1
2.3 The system shall provide an
option to download data to
an Excel supported file so
the BA can customize
1. BA can select to extract data to an
Excel supported file
2. Extracted data is formatted as a
tabular data set with no row breaks
Functional Proposed BA Should PO#1
2.4 The system shall allow for
customization of reports
to include filtering and
displayed fields.
1. BA can selected fields to include or
exclude in resulting report
2. BA can filter report (see 2.2.1)
Functional Approved BA Should PO#1
PO#1 – Project Objective #1 – “record, manage, communicate, and update requirements so that requirements can be captured once and then managed and communi-
cated efficiently”
Priority uses MoSCoW – Must be include in release (mandatory), Should be included in release (highly desired), Could be included in release (nice to have), Won’t be
included in release (out of scope)
Source: Vicki James, PMP, CBAP, PMI-PBA, CSM.
Chapter 7 Scope Planning 215
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AGILE
When requirements are complete, each requirement needs to be:
Traceable back to the business reason for it
Identified with the stakeholder(s) who need it
Unambiguous
Qualified by measurable conditions
Validated for its value and completion
Bounded by constraints
Prioritized according to value, cost, time risk, or mandate so trade-off decisions can
be made if needed
Once these requirements are developed, they are translated into specifications, as
shown in Exhibit 7.3.
There are several differences in gathering stakeholder input in Agile. In an Agile proj-
ect, the Product Owner is the interface to the product stakeholders and is responsible
for aligning stakeholders to priorities and capabilities. Agile focuses on delivering value
to the customer quickly, so feedback can get to the development team quickly. This
eliminates waste. Agile further assumes that the people doing the work know how to
do the work, and requirement writers are not qualified to tell them how to do that
work. At every iteration, the delivered product should be ready for use, if the customer
would choose to do so. As you can see, this would not work for a building that does
not have windows, so the type of project in which you engage will start to take shape
as you see the outcome being requested. In Agile, we are more likely to produce a
color of blue that seems to make sense to the team and get feedback. The goal is not
to be right: it is to get feedback. In a more Agile environment, there is only the judg-
ment of how well the product works. The customer ideally would not get involved in
how the product is created. Creating a model or prototype described above is analo-
gous to Agile delivering working software every few weeks to get feedback. If all is
well, we keep going; if not, we pivot and deliver more. In Agile, the requirements are
captured in a product backlog. The product manager prioritizes them on an ongoing
basis. They are delivered in short iterations and reviewed with the stakeholders on a
normal cadence.
EXHIBIT 7.3
REQUIREMENTS TRANSLATED INTO SPECIFICATIONS
REQUIREMENTS SPECIFICATIONS
Unambiguous—not subject to
interpretation
Complete—nothing left out
Consistent—no conflicts, which also
means no duplication
Modifiable—amenable to change
Traceable—to a customer need
Verifiable—means provided to verify the
requirement
Unique set—each stated only once
Normalized—should not overlap
Linked set—shows relationships
Complete—nothing left out
Consistent—no conflicts
Bounded—specifies nonnegotiable constraints
Modifiable—amenable to change
Configurable—traceable changes
Granular—right level of abstraction
Adopted from: IEEE 1233
216 Part 3 Planning Projects
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7-3 Define Scope
Define scope is the process of translating stakeholder needs and requirements into
detailed specifications of the project outcomes and products. Essentially, the project
scope statement includes three things regarding the total scope. First, the team needs to
determine both what they will deliver to the project stakeholders at the end of the project
and what they need to deliver along the way to ensure they will be successful in the end.
These are the deliverables—the product scope. For example, if a final project deliverable is
a new computer program, intermediate deliverables may include an outline of what will
be included and a prototype. Second, the team should decide what work needs to be
accomplished to create the deliverables. This is the project work statement—the project
scope. Third, the team needs to determine what will limit or influence the project work—
such as exclusions, constraints, and assumptions.
7-3a Reasons to Define Scope
Scope definition is an important part of project planning because all other planning is
based on the project scope. While the requirements collected represent the customers’
statement of what they need, the defined scope is the project team’s response—asking
the customer, “If we provide this, will it solve your problem?” It is impossible to estimate
how much a project will cost, how many (and what type of) workers will be needed, how
long a project will take, what risks are involved, or what quality standards will be
invoked without first understanding what work is included in the project.
Scope definition also is vital in preventing scope creep. Scope creep happens for two
common reasons. First, if the scope is not clearly defined and agreed upon, it is easy to
add additional work (scope creep) to the project with or without realizing that more time
and resources (additional cost) will be required. Second, sometimes when a project is going
as planned, a customer is so excited that he or she asks an innocent-sounding question:
“Can the project output also do … ?” The person performing the project work is often
flattered and agrees without understanding the implications of making this change. In con-
temporary business, pleasing the customer is desirable. However, the best time to gain cus-
tomer understanding is when the project team is defining the scope—not while executing
the project scope work.
7-3b How to Define Scope
Scope definition can vary greatly from one project to another. For a small, routine con-
struction project, it may be quite simple to determine what project outputs will be cre-
ated and what work is involved in creating them. On other projects, such as one large
company acquiring another, it may be very difficult to determine the total amount of
work that needs to be accomplished. Regardless of how easy or difficult it may be to
define scope and despite industry-specific methods that may be helpful in doing so, all
project teams need to complete each part of this process.
LIST DELIVERABLES AND ACCEPTANCE CRITERIA The first step is to list project
deliverables. The requirements elicited from the customer often lead to some of the final
deliverables. Project teams need to understand that there are often multiple deliverables.
For example, if a project entails constructing a house, the homeowners probably want
not only the house but also documentation on systems within it, perhaps an explanation
(training) on how to use certain items such as an innovative thermostat, and a warranty
procedure. The project team also needs to list intermediate deliverables—those things
that need to be developed while making progress to complete the project. Some of
Chapter 7 Scope Planning 217
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AGILE
these were probably listed in the charter, but others may not yet be identified. Then the
project team needs to determine the acceptance criteria for each deliverable.
ESTABLISH PROJECT BOUNDARIES The second step in defining scope is to estab-
lish the project boundaries. Think of the project boundaries as the sidelines on an ath-
letic field. By understanding what is in play and what is not, athletes know clearly when
to play and when to stop. Likewise, project team members need to know which tasks
should be executed and which tasks need not be executed.
The first part of the boundary definition is to decide which features and work elements
are included (in scope) and which are excluded (out of scope). Collectively, clients and end
users often request far more features and work than a project is originally planning to
deliver or can deliver. Therefore, the team needs to know and decide what is included
and what is not. Usually, the sponsor makes decisions regarding larger scope decisions,
but the project manager and team still have many detailed scope decisions to make.
The second part is to manage expectations regarding any project. The project team
members need to understand the constraints imposed on the project. If the work must
be delivered by a certain date or if only limited resources are available, the project may
be constrained, and the team should be careful to promise only what it can deliver. In
planning, people make assumptions about dates, times, and availability of resources; for
example, a shipment of required materials will arrive by the date the supplier promised.
These assumptions should be stated. If an assumption proves to be false, it frequently
increases the project risk and may also limit the project scope.
CREATE A SCOPE DESCRIPTION The final step is to create a scope description.
This description briefly states the work that needs to be accomplished to create the proj-
ect deliverables.
A project scope statement guides the project team during subsequent planning and
execution. For some very small projects, a well-developed project charter could also
serve as a scope statement. On most projects, a scope statement needs to be developed
prior to development of the WBS. An example scope statement for the Alternative
Breaks project is shown in Exhibit 7.4.
7-3c Defining Scope in Agile Projects
Agile strives to use smaller iterations to get feedback because understanding the desired
outcome tends to evolve as the customers see the work being done by the team.
Humans tend to be poor estimators, and the more unique the project, where volumes of
reliable data are not available for making estimates, the harder it is to be predictable. In
construction, for example, there are software packages that help estimate how long it will
take to hang drywall or run electrical wire. However, in more creative endeavors like cre-
ating software, there is little documented knowledge of how long a project will take. This
is where the adage to underpromise and overdeliver becomes words to the wise.
With Agile projects, the project manager is challenged with conflicting aspirations
and actions between finalizing the scope specifications and maintaining flexibility to
modify them to meet changing business needs or adding new requirements of stake-
holders. Agile scope definition is a complex process as the scope is not clear to either
the project team or the client. The project manager and the project team must demon-
strate greater adaptability to frequently changing scope and employ iterative or phased
planning of scope. Consequently, Agile projects present more flexibility.
On Agile projects, the scope definition starts with large chunks of work; for example,
we want to be able to take credit card payments on a website. This large feature, and
218 Part 3 Planning Projects
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EXHIBIT 7.4
SCOPE STATEMENT
ALTERNATIVE BREAKS PROJECT SCOPE STATEMENT
Scope Description: This project will educate groups of 12 students on social justice issues, send
them out to perform direct service on the issues, and provide reflective opportunities throughout
the process. Key deliverables with acceptance criteria (product scope):
KEY DELIVERABLES ACCEPTANCE CRITERIA
Project plan Secured housing,Agreement with organization
Fundraising Adequate money
Education Syllabus
Reorientation Digital archives
Trip itself Return safely, pre- and post-evaluation
Exclusions: No alcohol, drugs, or romances; ratio number of trips to student population
Constraints: Van holds only 12 people—11 students and one faculty or staff; number of highly
qualified site leaders
Assumptions: Service builds active citizens; international trips add more value than expense; a
trip is better with a staff or faculty member.
Source: Chris Bridges.
Chapter 7 Scope Planning 219
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there will be many of them for a fully functioning website, will be broken down into stories
and prioritized later. The team creates “personas,” which are fictional people who repre-
sent user types. These personas provide information about what they will do with the proj-
ect deliverables and how they will benefit. These user stories define scope and
functionality. Acceptance tests will also be agreed upon during the scope definition phase
by describing the way project deliverables will be tested and how they should prove work-
able. At the project outset, the overall scope is only defined at a high level, and a backlog of
possible work is identified. The customer representative (sometimes called the owner)
prioritizes the scope based upon business need, value, cost, and risk. The team then com-
mits to the amount of work they can perform in the first iteration. As the project pro-
gresses, the scope is described more specifically and is documented more closely. The
level of documentation is less important and takes a secondary role. The primary measure
of success in an Agile project is working software. The Agile method for defining scope is
primarily applicable when the project scope is unclear or poorly defined.
7-4 Work Breakdown Structure (WBS)
After scope definition is complete, the project manager will have a greater clarity about project
work and milestones as compared to the high-level understanding of the project when the
project charter is defined (discussed in Chapter 3). The milestones defined in the project char-
ter are not necessarily accurate due to lack of complete understanding of the total project
work. It is important to note that the project charter must be seen as an authorization docu-
ment with accuracy of estimates (cost and time) in the range of + 50 percent. With the defini-
tion of scope, more details about the project are available to develop WBS and new milestones.
A detailed understanding of the project scope and work to be performed must be simpli-
fied for execution, and it is essential to divide the total work into smaller and manageable
elements. A tool that is used on virtually all traditional projects is the WBS. To understand
this tool, we will first define it, tell why it is important, show several common formats to use
when constructing one, and then demonstrate the steps required to construct a WBS.
7-4a What Is the WBS?
The WBS is, or should be, a uniform, consistent, and logical method for dividing the
project into small, manageable components to manage project scope and for planning,
estimating, and monitoring (Rad and Anantatmula, 2009). It is a project planning tool
that is defined as the concept of hierarchical decomposition for transforming the project
scope into deliverable work elements at the highest level. Its composition continues
until it facilitates managing these work elements effectively. The WBS helps develop an
optimum project schedule and cost estimates at the work element level.
The WBS is a tool that project teams use to progressively divide the deliverables of a proj-
ect into smaller and smaller pieces. The project team members start by identifying the major
deliverables to be created and by continuously asking: “What are the components of this
deliverable?” The WBS is not a list of work activities, an organizational chart, or a schedule.
The WBS is a framework that is used as a basis for further planning, execution, and control.
The WBS also is an important project planning tool that uses the concept of hierar-
chical decomposition for transforming the scope into deliverable work elements. Typi-
cally, the WBS is created after the scope is defined on large projects. In contemporary
project management, particularly on small and middle-sized projects, the WBS may be
created concurrently with the scope statement.
The WBS is normally developed by listing deliverables—major deliverables first and
then progressively smaller ones until the team feels that every deliverable has been
220 Part 3 Planning Projects
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identified. Managers of smaller projects sometimes perform another process concurrent
with WBS development: defining activities and milestones. Define activity is a project
planning process that identifies and determines specific actions to develop and deliver
the project outcomes, such as products, services, or results. Many people find that work
activities can be easily defined once the various deliverables are itemized. To clearly dis-
tinguish between the work processes of WBS development and activity development,
WBS development is covered in this chapter, and activity development is covered as
part of project scheduling in the next chapter. Developing the WBS and defining the
activities form an example of how two separate work processes are sometimes performed
together (especially on small or simple projects) and sometimes separately (especially on
large or complex projects).
7-4b Why Use a WBS?
The reasons for using a WBS are many. Planning projects requires discipline and visibil-
ity. A properly developed WBS encourages a systematic planning process, reduces the
possibility of omission of key project elements, and simplifies the project by dividing it
into manageable units (Rad and Anantatmula, 2009).
A WBS can be used as a pictorial representation of project deliverables. By using a
systematic process for creating a WBS, project team members can ensure that they
Framing a house is a major deliverable in a house project.
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Chapter 7 Scope Planning 221
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include all deliverables that are required to be created. Deliverables that are not planned,
but need to be, often add to schedule delays and budget overruns.
The WBS provides a framework of common reference for all project elements, for
specific tasks within the project, and ultimately for better schedules and better estimates.
It is the basis for all subsequent planning of such important functions as schedule,
resources, cost, quality, and risk. It also serves as an outline for integrating all these plan-
ning elements. The WBS is easily modified and thus can handle the changes that often
occur on projects. The impact of these changes is then shown in the schedule, budget,
and other control documents. If a problem occurs during project execution, the WBS is
helpful in understanding exactly where and why the problem occurred. This helps to
diagnose problems, manage the quality of the project deliverables, and keep all the
other facets of the project on schedule while the isolated problem is fixed.
The WBS is also helpful in project communications. Typically, many stakeholders contrib-
ute to developing the WBS, and this effort helps them understand the project. Further, it
clearly shows the importance of each work element, why it is required, and how it is inte-
grated with project deliverables. In a nutshell, the WBS presents the entire scope of the project
and serves as an excellent communication and integration tool. Software such as Microsoft
Project enables a WBS to be shown in its entirety to people who need to understand the
details, but it also allows project details to be hidden so that others can see the big picture.
7-4c WBS Formats
There are various formats for constructing a WBS, but they all have the same purpose.
The overall project is considered the first level, as shown in Exhibit 7.5. In this example,
a WBS for a house is presented in the indented outline format.
The second level in this example depicts major deliverables from the house project,
namely the house in its framed state, when it is wired, and when it is drywalled. This
second level is indented one tab. Note that a section is included for the work of planning
and managing the project.
A WBS usually has one or more intermediate levels, which generally represent items that
need to be created to produce the final deliverables, such as drafts, prototypes, and designs.
These are frequently called interim deliverables. All levels of the WBS with at least one level
EXHIBIT 7.5
HOUSE WBS IN INDENTED OUTLINE FORMAT
HOUSE
Project Management
Framed House
– Framing Contractor
– Wood
– Assembled Frame
Wired House
– Wiring Contractor
– Wiring
– Installed Wiring
Drywalled House
– Drywall Contractor
– Drywall
– Hung Drywall
222 Part 3 Planning Projects
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below are considered summary levels. The completion of summary-level elements is based upon
completion of all levels underneath. For example, in Exhibit 7.5, the house would not be framed
until the framing contractor, wood, and assembled frame interim deliverables were complete.
Exhibit 7.5 used the indented outline format for the WBS method, but other methods are
sometimes used. Another method is the hierarchical or “org chart” (short for organizational
chart, which it resembles) method. A third method is called free format because the facilitator
is free to draw it in any manner. The same house project shown in Exhibit 7.5 in indented
outline format is shown in Exhibit 7.6 in org chart format and in Exhibit 7.7 in free format.
EXHIBIT 7.6
WBS IN ORG CHART FORMAT
EXHIBIT 7.7
WBS IN FREE FORMAT
Framing
Contractor
Wood
Assembled Frame
Wiring Contractor Wiring
Installed Wiring
Drywall Contractor
Drywall
Hung Drywall
Project
Manage-
ment
Chapter 7 Scope Planning 223
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A marker board or flip chart can be used to develop all these methods and also offers
plenty of room to add additional elements as the scope is revised. The WBS method
using indented outlines can easily be imported into MS Project. Teams using the org
chart or free format methods for WBS generally translate them into the indented outline
format for input into software.
7-4d Work Packages
The house example above has only three levels as follows:
1. The first level, or project title level
2. One intermediate level, or summary level
3. The lowest level, or work package level
This process of dividing the deliverable items is continued until the project has been
divided into manageable, discrete, and identifiable items requiring simple tasks to com-
plete. A practical rule is to keep dividing the project until it no longer can be divided
realistically. This point may differ from project to project. The lowest level is known as
a work package.
In a WBS, an element at the lowest level is called a work package, which is usually
the work component at the lowest level of the WBS for which cost and duration can be
estimated and managed. Work packages are the basis for all subsequent planning and
control activities. Exhibit 7.8 shows a WBS in org chart format with work packages in
solid boxes.
One frequently asked question when breaking the deliverables into work packages is
how small is small enough. The answer is, “It depends.” In Exhibit 7.8, work packages
occur at levels 3, 4, and 5. The work package is the point from which:
Work activities are defined
The schedule is formed
EXHIBIT 7.8
WBS DEPICTING WORK PACKAGES
PM
Project
AB CD EF
Level
1
2
3
4
5
Source: Kevin P. Grant, UTSA.
224 Part 3 Planning Projects
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Resources are assigned
Many of the control features are developed
Work packages need to be detailed enough to facilitate further planning and control.
If they are too detailed, the burden of tracking increases. The project manager needs to
feel confident that the work to create the work package can be assigned to one person
who can estimate the schedule and cost and can be held responsible for its completion.
However, the work package may require multiple resources (including more than one
person) to complete it.
If the work is composed of a single deliverable that is well understood, it is clear how
the deliverable will be judged for quality and completeness, and the assigned workers
have proven credentials, then the work package may not have to be too detailed. On
the other hand, if the deliverable and/or how it will be judged for its completion are
poorly understood, and the assigned worker or workers are yet to be proven reliable, a
more detailed work package may make sense.
For ease of communication and comprehension, work packages and other components
of a WBS are usually stated in very few words; one should avoid verbs and instead use
adjectives to describe WBS elements at all levels. A WBS component is a work element
that is part of the WBS at any level. The phrases or words to describe WBS elements
should not be repeated. However, because the names are typically short, there is still the
potential to get confused by exactly what is included in a work package or WBS compo-
nent. Therefore, WBS components are often defined further using a WBS dictionary. A
WBS dictionary is a document that provides detailed information about each work pack-
age by providing details about the associated deliverable, activity, scheduling information,
predecessor, successor, person responsible for it, resources required, and associated risks.
An example of a WBS dictionary entry with detailed information for a work package is
shown in Exhibit 7.9. Note that some of this additional information such as activities,
resource assignments, effort, and cost will be described in subsequent chapters.
EXHIBIT 7.9
WORK PACKAGE DETAIL
Project: Expansion to Full Scale Production Work Package: Assembly Hardware Test
Description:
Plan, conduct, evaluate, and report results
of tests to ensure proper function of the
assembly hardware.
Deliverable(s):
Test results summary.
Input(s):
Assembly hardware prototype
Activities Resource Expected
Duration
Cost
Prepare test plan Production Analyst 8h $ 720
Conduct test Production Analyst 16h 1,440
Evaluate test results Production Analyst 6h 540
Prepare test results summary Production Analyst 8h 720
$3,420
Source: Kevin P. Grant, UTSA.
Chapter 7 Scope Planning 225
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7-4e How to Construct a WBS
The information for a WBS is drawn primarily from the project objectives statement,
and from historical files containing planning information of past projects. When a proj-
ect team needs to construct a WBS, it needs to include in its planning team a subject
matter expert (SME) who understands how each segment of the work will be accom-
plished. Teams approach this task in two ways. The first approach is that teams include
only the core team members and plan the WBS as in as much detail as they can. At that
point, different core team members are assigned to identify and seek the SMEs to plan
the remaining details. In the second approach, teams invite the SMEs to the WBS plan-
ning meeting right from the start and utilize their input throughout the WBS develop-
ment. Often, the choice of how to include SMEs is determined by the size and
complexity of the project and by the cultural norms of the company.
The planning team uses a top-down approach in creating the WBS. This is easy to
start when the type of project is familiar and at least some members of the planning
team are likely to understand the general flow of work. If the project is similar to past
projects, either a template or the WBS from a previous project can be used as a starting
point. Then, using this template or WBS, the project team would identify additional
project needs for inclusion and irrelevant elements of the previous project for deletion.
Templates and previous examples can save teams a great deal of time, but caution must
be exercised because each project is unique.
Sometimes, however, a project is so unique and different from previous projects
that the team finds it useful to jump-start the WBS construction by brainstorming to
identify a list of project deliverables to help to understand and develop the overall
structure of the project WBS. However, once the overall structure is understood, the
team proceeds with the typical top-down approach for the remainder of the WBS
development.
IDENTIFY MAJOR DELIVERABLES The team defines the project deliverables by
reviewing the project planning completed thus far. The team members review the project
charter, requirements traceability matrix, and scope statement to define the project’s
major deliverables. Remember that while many projects may have a primary deliverable
such as a house, almost all projects have additional deliverables such as documentation
and customer support. These could include training, service, or other means of helping
the customer use the project’s products effectively.
One of the first decisions is how to organize the second level of the WBS. (Remember,
the first level is the overall project.) As defined earlier, the WBS is, or should be, a uni-
form, consistent, and logical method for dividing the project into small manageable com-
ponents. WBS development is viewed as the process of grouping all project elements into
several major categories, normally referred to as level one; each of these categories will
itself contain several subcategories, normally referred to as level two. Alternately, and
more accurately, development of a WBS involves dividing the project into many parts
that, when combined, would constitute the project deliverable. This process of dividing
the deliverable items is continued until the project has been divided into manageable,
discrete, and identifiable items requiring simple tasks to complete.
Three methods are shown in Exhibit 7.10. One method is by project phase, with the
second level being the signing of a contract, building the foundation, and framing the
house. Alternatively, the second level can be organized by design components
(deliverable-basis), such as kitchen, bedrooms, and bathrooms. Finally, the second level
can be organized by work function (resource-basis). A house project organized this way
might have carpentry, plumbing, and electrical as second-level elements.
226 Part 3 Planning Projects
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Organizing by project phase (schedule-basis) has the advantage of using the mile-
stones in the project charter as an organizing principle. It also facilitates rolling wave
planning. Rolling wave planning is a planning technique of identifying and defining
the work to be completely accomplished in the near term and planning the future work
at a higher level. In other words, once the near-term work is complete, the next phase of
the project is planned in detail. In essence, it is an iterative process. If the planners of the
project in Exhibit 7.10 used rolling wave planning, the work associated with the contract
would be planned in detail immediately, and work for the foundation and framing might
only be planned at a high level at first with more detail worked out as the project team
worked on the contract. Rolling wave planning allows a team to get a quick start on a
project—especially one in which details of later phases may depend on the results of work
performed during early phases. Rolling wave planning helps a project team avoid either of
two extremes. One extreme is to never start doing anything because the plan is not yet com-
plete, which is also known as analysis paralysis. The opposite extreme is not planning at all
because of fear that planning will take too long; this is known as ready, fire, aim.
Organizing by either phase or design components/deliverables helps to focus commu-
nications on project deliverables and their interactions. Organizing by work function
allows the functions to focus on their specific activities, but often does not promote
cross-functional discussion. Handoffs of work from one group to another are not always
as smooth. Therefore, if a project manager decides to organize the WBS by work func-
tion, extra care needs to be taken in establishing interfunctional communications.
Of the three approaches, the most generally useful, and the most difficult, method for
developing a WBS is to use design components/deliverables as the basis of the break-
down of the project. It is also known as a deliverable-based WBS. The deliverable-basis,
or design-basis, is developed by looking at the project from the client’s perspective and
not from the project execution perspective. Further, it makes sense to all key stake-
holders and facilitates easy communication.
In this deliverable-basis or design-basis mode, the project is divided into individual dis-
tinct components that ultimately comprise the project, such as hardware, software, physical
structure, concrete foundation, or steel roof. This deliverable-based WBS division can be
based on product, function, or physical location of the deliverable (Rad and Anantatmula,
2009). The deliverable basis of WBS development is far superior to the other bases because
it is customer focused and easy to facilitate during project execution.
Note that one additional second-level item is shown on all three methods—that of
project management. This includes the work of planning and managing the effort and
EXHIBIT 7.10
WBS ORGANIZATION EXAMPLES
PROJECT PHASE
DESIGN COMPONENTS/
DELIVERABLES
WORK FUNCTION/
SUBPROJECT
Project Management
Contract
Foundation
Framed House

Project Management
Kitchen
Bedrooms
Bathrooms

Project Management
Carpentry
Plumbing
Electrical

Chapter 7 Scope Planning 227
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includes preparing documents, attending meetings, integrating diverse portions of the
project, handling communications, and so on. Since much of the work involved in proj-
ect management is the level of effort, this section may not be decomposed. If the work of
managing the project is left out, it is more likely that the project will not be completed
on time and within the budget.
It is very important to understand that, in many cases, the client is not concerned
about the intricacies of project execution or project management activities. From a cli-
ent’s perspective, the focus is only on what is delivered as the project outcome. So, proj-
ect management is not typically included in a deliverable-based WBS. However, there are
exceptions to this rule. For large and mega projects, programs, and federal government
contracts, it is possible that the client is interested in project management activities and
project progress reports. In such cases, including project management in the WBS may
be sensible, even in a deliverable-based WBS.
DECOMPOSE DELIVERABLES Once the major deliverables have been defined, it is
time to break them into smaller deliverables or components. This is called decomposi-
tion, a method of dividing the project scope into many parts that, when combined,
would constitute the project deliverable. It is the process of breaking down the project
scope until it has been divided into manageable, discrete, and identifiable components
requiring simple tasks to complete.
The team members can use the top-down approach, asking what all the components
of each major deliverable are. Alternatively, the team members may use a bottom-up
approach by brainstorming a list of both interim and final deliverables that they feel
need to be created. Each deliverable can be written on an individual Post-it Note. These
deliverables are then assembled on a large work space where team members group the
smaller deliverables either under the major deliverables that have been previously identi-
fied or into additional related groups that are then headed by major deliverables.
CONTINUE UNTIL DELIVERABLES ARE THE RIGHT SIZE At this point, the WBS
has been formed and can be reviewed for completeness. Once it is determined to be
complete, the team can ask if the deliverables at the lowest level need to be divided fur-
ther for planning and control as described above. For example, in the new car develop-
ment project in Exhibit 7.11, level-two components, such as product design, are at too
high of a level to plan and control. Therefore, at least one more level should be included.
If some of those components, such as Product Goals, are still too broad, yet another level
would need to be developed.
REVIEW At this point, several things should be considered to ensure that the WBS is
structured properly. One consideration with WBS construction is the parent-child con-
cept. The higher level is considered the parent and the lower-level elements are consid-
ered children. For example, in Exhibits 7.5, through 7.7, “Framed House” is a parent to
the children: “framing contractor,” “wood,” and “assembled frame.” “Framed House,” in
turn, is a child to “HOUSE.” The framed house component is not complete until all of
its children components are complete. The team asks if, once these elements are com-
plete, the framing is complete. In an effort to simplify the WBS, where only one child
element for a parent exists, you would not break it down. In fact, a good rule of thumb
is to have somewhere between three and nine child elements for each parent. The fewer
levels a WBS has, the easier it is to understand.
To avoid confusion, each component in the WBS needs to have a unique name.
Therefore, two similar components may be draft report” and final report,” instead of
merely calling each “report.” The team also assigns a unique number to each component.
228 Part 3 Planning Projects
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In one common numbering system, the number for a child item starts with the number
assigned to its parent and adds a digit. An example of a WBS with components num-
bered is shown in Exhibit 7.12.
Different organizations sometimes develop their own unique variations of project plan-
ning and control techniques. Exhibit 7.13 describes the manner in which a large, complex
organization (the U.S. Central Intelligence Agency) combines stakeholder analysis with
WBS.
7-5 Establish Change Control
A baseline is the approved project plan mainly consisting of scope, schedule, and cost. It
is not normally altered unless a formal change control request is approved for modifying
these plans. The project team looks at the scope statement and WBS to ensure complete-
ness and seeks to validate the scope by verifying it with the sponsor, customers, and/or
other stakeholders. Simultaneously, the project team can be planning other aspects of the
project such as schedule, resources, budget, risks, and quality. Once all these plans are
complete and any impacts to scope have been accounted for, it is time to baseline the
scope statement and the entire project plan. This is discussed in more detail at the end
of the planning stage (Chapter 12).
Most projects are planned and conducted in an environment of uncertainty. Projects
are planned with assumptions based upon the best information available to the project
team, but many things can change during the course of a project. Therefore, project
teams deal with change by establishing and using a change control system that entails
processes to receive and review change proposals and accept or reject them after
evaluating their impact on project scope, cost, and schedule. In essence, it is a system
of managing and controlling changes and modification to the project plan and
EXHIBIT 7.11
PARTIAL WBS OF CAR DEVELOPMENT PROJECT
Car Development Project
Project Management
Product Design
Product Goals
Concept Design
Modeling Design
Vehicle Integration
Engineering Feasibility
Detailed Engineering Design
Performance Development
Regulatory Certification
Process Development
Prototype
Production Materials Procurement
General Materials Procurement
Trial Manufacture
Chapter 7 Scope Planning 229
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EXHIBIT 7.12
LIBRARY PROJECT WBS WITH COMPONENTS NUMBERED
LIBRARY PROJECT
1. Project Management
2. Facility Needs
2.1 VISION STATEMENT
2.2 STAKEHOLDER INPUT
2.3 OPTIONS
3. Building Proposal
3.1 RECOMMENDED SIZE AND SCOPE
3.2 SITING
3.3 COST RATIONALE
4. Building Approval
4.1 VP OF FINANCE APPROVAL
4.2 PRESIDENT APPROVAL
4.3 BOARD APPROVAL
5. Staff Education
5.1 LITERATURE REVIEW
5.2 LIBRARY VISITS
5.3 SUPPLIER INPUT, PROCESS, OUTPUT, CUSTOMER ANALYSIS
5.4 TRAINING
6. Fundraising
6.1 POTENTIAL DONOR LIST
6.2 RELATIONSHIP BUILDING WITH POTENTIAL DONORS
6.3 EDUCATION OF POTENTIAL DONORS
6.4 DONATIONS
6.5 FOLLOW-UP WITH DONORS
7. Building Documents
7.1 FACILITY AND SITE SPECIFICATIONS
7.2 SCHEMATIC DESIGNS
7.3 DEVELOPMENT PLANS
7.4 CONTRACT DOCUMENTS
8. Building Construction
8.1 ARCHITECT
8.2 CONTRACTORS
8.3 CONSTRUCTION
8.4 FURNISHINGS
9. Building Acceptance
9.1 BUILDING AND GROUNDS ACCEPTANCE
9.2 BUILDING OCCUPANCY
9.3 BUILDING DEDICATION
9.4 WARRANTY CORRECTIONS
230 Part 3 Planning Projects
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project deliverables. Uncontrolled change is known as scope creep. Sometimes, the
effects of scope creep are so bad that a well-started project can run into serious
trouble.
The critical aspect of a change control system is the method of documenting changes.
Each potential change to a project is normally documented by some sort of change
request, which is a written request or a formal proposal to propose changes to any proj-
ect planning component such as a document, project deliverable, or baseline (scope, cost,
and time).
This means every change to a project needs to be formally proposed. The potential
change is then either accepted or not. If it is accepted, the project plans are changed to
reflect the impact of the change. Most people quickly understand the need to docu-
ment major changes, but some resist the effort it takes to document small changes.
The impact of many small changes is like the old saying, “killed by a thousand small
cuts.” Many small changes individually have small impacts on a project, but collec-
tively they have a major impact. Project managers need to create an expectation that
all changes be formally documented using a simple change request form so all team
members will document proposed changes. A simple change request form is shown
in Exhibit 7.14.
Change request forms typically include several sections. The top section lists basic
information to track the change request to the project and to the person who submit-
ted it. The second section contains two simple statements describing the change and
why the change is needed. The third section details the impact expected from the
potential change. This can vary in length from a simple check and comment section,
as in Exhibit 7.14, to an extremely involved description of potential impact on complex
system projects such as designing an aircraft. In complex projects, small changes can
EXHIBIT 7.13
STAKEHOLDER ANALYSIS AND WBS AT THE CIA
At the CIA, where I created and run our agency-wide project management training and certification program, I come in contact
with large numbers of dedicated project managers. With enrollment averaging about 2,500 students per year, I encounter a work-
force with a broad spectrum of experiences, skills, and expectations. One of the more prevalent expectations is associated with
stakeholder analysis and communication; employees invariably feel that they pretty much know most or all they need to know in
this area and may even begrudge somewhat the three days associated with our Project Communications Management course.
What they discover are the shortcomings in their appreciation for and knowledge about project communications. Using a five-
point Likert scale, we have every student perform a self-assessment of their communications proficiency prior to and after the
class. To the students’ surprise, proficiency increases average a full point; student feedback virtually always includes statements to
the effect that they didn’t realize just how much more effective they can be in project management by investing more in the proj-
ect communications area.
The organizational chart plays a central role in how the CIA approaches the analysis of stakeholders. Employees learn through
classroom exercises to use the organizational chart as a roadmap for identifying the stakeholders. As they march through the branches
in this chart, they make conscious decisions about whether the function represented by the title or box on the chart or whether the
individual performing that function is a stakeholder. Once they have identified the stakeholders and performed the associated stake-
holder analysis, they then turn to the WBS to help with the planning and implementation of the communications tasks that follow.
In fact, communications for the types of projects undertaken at the CIA have taken on such importance that we advocate it be placed
at the first level of WBS decomposition alongside equally important components such as project management. For projects of suffi-
cient size, a full-time leader is often assigned to the communications component; the scope of their duties includes communications
within the project as well as communications outside the project.
Source: Michael O’Brochta, PMP, director, PPMC Program, CIA.
Chapter 7 Scope Planning 231
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sometimes have catastrophic impacts. Finally, there should be a space for the change to
be approved. Regardless of the complexity and format, the most important consideration
is that potential changes must be submitted and documented whether they are approved
or not.
7-6 Using MS Project for Work Breakdown
Structures (WBS)
As you have likely realized, the WBS is one of the most important and powerful project
planning tools available to the project manager. It is one of the key building blocks on
which all further project activities are based. By creating a WBS in MS Project, the proj-
ect manager lays the foundation for automating many other planning and communica-
tion tools the software has to offer. Complete the following steps to set up a WBS in MS
Project.
7-6a Set Up a WBS in MS Project
Setting up a WBS in MS Project has five basic steps:
1. Understand the WBS definitions and displays.
2. Enter project deliverable and work package elements.
EXHIBIT 7.14
CHANGE REQUEST FORM
ORIGINATOR: PROJECT #:
Date
Description of Change:
Why needed:
Impact on project scope:
Impact on deadline dates:
Impact on budget:
Impact on quality:
Impact on risk:
Impact on team:
Date approved:
Project manager Sponsor Customer
_______________ _______________ _______________
232 Part 3 Planning Projects
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3. Create the outline of your WBS.
4. Insert a WBS code identification column.
5. Hide (or show) the desired amount of detail in the WBS.
STEP 1: UNDERSTAND THE WBS DEFINITIONS AND DISPLAYS MS Project refers
to WBS task elements as summary tasks, tasks, and subtasks and displays them in an
indented outline table format:
Summary tasks are the main or interim WBS deliverables and are displayed in bold
font.
Subtasks are all the tasks that make up the deliverables (work packages) and are
indented below their parent summary task.
WBS tasks can also be viewed in Gantt views with different graphical shapes:
For instance, a summary task might also be a milestone that you would want to
denote graphically in your Gantt chart (typically a diamond in MS Project).
You will see these graphical representations in future tutorials.
Exhibit 7.15 shows a Gantt table view of a WBS in MS Project. Note that MS Project
codes the overall project (Suburban Park Homes) as level zero, not level one. The task
durations have not been defined at this point and show “1 day?” for all tasks. If you
are following along in MS Project, you will notice “Start” and “Finish” columns to the
right of the Duration column that also have not been defined. The Start and Finish col-
umns are not shown in the following exhibits for clarity’s sake.
STEP 2: ENTER WBS ELEMENTS (TASKS) In Exhibit 7.16, you will see WBS task
elements added to the existing Suburban Park Homes project milestone list (from
Chapter 3). In this WBS example, the existing milestones will double as the main deliver-
ables (summary tasks). Enter these WBS elements to your project as follows:
1. In the Task Name field, select the row below where you want the new row to be (after
making your selection, holding the SHIFT key and selecting a different row will high-
light all rows between the two selections and result in that number of blank rows
being inserted in the next step).
2. Click Task Tab>>Insert Group>>Task.
a. Alternatively, you can Right-Click>>Insert Task.
3. You will see a new row (or rows if you added multiple) with the words
in the Task Name field. Click on and enter the name of the desired WBS
element (you may have to delete before typing in your new task name).
4. Repeat these processes as needed to enter additional tasks between the Suburban Park
Homes milestones until your WBS looks like Exhibit 7.16.
STEP 3: CREATE THE OUTLINE FOR YOUR WBS You now need to set up the out-
line structure of the WBS to show summary tasks and subtasks (deliverables, interim
deliverables, and work packages). To do this, use the Indent and Outdent controls
shown in Exhibit 7.17 (Task Tab>>Schedule Group>>Green Arrows).
1. Click the Task Name field of the row to be indented.
2. Task Tab>>Schedule Group>>Indent Task (right Green Arrow).
a. The task element above the indented task(s) becomes a summary row as indi-
cated by a bold font.
Chapter 7 Scope Planning 233
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b. Indenting a summary row will also indent its lower-level items.
c. Multiple rows under a summary row can be indented (or outdented) at the same
time by Shift-Click selecting all of them before clicking the Indent control.
3. Clicking Task Tab>>Schedule Group>>Outdent Task (left Green Arrow) will simi-
larly decrease indentation of the selected row(s) or summary task.
4. Indent to create deliverables, interim deliverables, and work packages until your WBS
resembles the outline shown in Exhibit 7.15.
STEP 4: INSERT WBS CODE IDENTIFIER COLUMN MS Project can automatically
assign identifier codes to all your WBS tasks. WBS codes allow the Project Team to easily
categorize and communicate information about project tasks in the WBS. In this
example, WBS codes will be assigned in a new column to the left of the Task Name
column:
1. Right-click the Task Name column heading and click Insert Column.
2. A drop-down list appears in a new column.
EXHIBIT 7.15
GANTT CHART VIEW THREE-LEVEL WBS
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
234 Part 3 Planning Projects
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3. From the drop-down list, choose WBS, as shown in Exhibit 7.18.
a. A WBS code column is now in place.
b. Resize the column to conserve space.
4. Right-click the Task Mode column heading and click Hide Column.
5. Your result should look like Exhibit 7.19.
EXHIBIT 7.16
ENTER SUMMARIES (DELIVERABLES)
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
EXHIBIT 7.17
INDENT AND OUTDENT CONTROLS ON THE TASK TAB
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
Chapter 7 Scope Planning 235
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STEP 5: HIDE (OR SHOW) SUBTASKS DETAIL Some stakeholders will not want or
need to see the lower levels of WBS detail (particularly in large, complex projects with
lots of WBS detail). You can easily “roll-up” (or “un-roll”) subtasks underneath their
parent summary task to hide (or show) detail. To display the appropriate level of detail,
complete one or both of the following steps:
Click the tiny triangle before the task name of any summary task to hide underlying
detail (all details will be “rolled-up” under the summary task).
Click the tiny triangle again to show underlying detail (all details “un-roll” under the
summary task and are again visible).
In Exhibit 7.20, the underlying detail for the “Land preparation, landscape, and foun-
dation” deliverable and the “Framing” interim deliverable summaries has been hidden.
EXHIBIT 7.18
READY TO INSERT SELECTED WBS COLUMN
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
236 Part 3 Planning Projects
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PMP/CAPM Study Ideas
It has been said that the discipline of project management lends structure to common
sense. Nowhere is this more true than with scope planning. If you can remember to con-
duct your planning with the end goal in mind, many of the processes and activities in
this chapter will seem intuitive. Another way of saying this is that you will work back-
ward from the outcome you desire (a successful product and/or project).
Begin by identifying what it would take for your product—and your project—to be
successful. Be sure to include your customers and end users in making this determina-
tion (“Collect requirements”), as well as subject matter experts who can speak to the
technical expertise needed and the feasibility of the project plan. Identify the final deli-
verables, as well as any important interim deliverables.
EXHIBIT 7.19
WBS COLUMN INSERTED
Source: Microsoft product screenshots reprinted with permission from Microsoft Corporation.
Chapter 7 Scope Planning 237
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Discussing these deliverables and what it will take to produce them is a good chance
for the team to further “define scope,” or determine what is included—and not
included—in your project.
Once you have the main deliverables, you will use the process of decomposition to
break them down into smaller pieces, thus creating a Work Breakdown Structure. It is
important to remember that the WBS deals with things, not activities (though on a very
small project, these may be planned concurrently). The lowest level of the WBS is the
“work package,” which is small enough that it can be easily planned and overseen by one
person.
To be sure, this is an oversimplification of everything that goes into planning scope,
and you will need to be fluent in all the activities and processes in this chapter in order
to pass a CAPM or PMP test. But it can be helpful to remember that there is an organiz-
ing structure to all this work—one that begins with the end result in mind.
EXHIBIT 7.20
HIDE OR SHOW UNDERLYING DETAIL
238 Part 3 Planning Projects
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Summary
Once a project is formally approved by a sponsor rati-
fying its charter, it is time for detailed planning. While
project planning is iterative, normally the first steps are
to identify stakeholders, plan communications, and
determine what will be created on the project. Project
teams start this process by asking customers what end-
of-project deliverables they want. From the customers’
response, the planning team can determine both what
interim deliverables need to be created and what work
needs to be performed to create all of the deliverables.
Just as important as determining what will be produced
during the project is determining what will not be pro-
duced. These boundaries of what will and will not be
included constitute the project’s scope.
Once the scope is defined, it can be organized into
a work breakdown structure (WBS). A WBS is used to
progressively decompose the project into smaller and
smaller pieces until each can be assigned to one per-
son for planning and control. The WBS serves as a
basis for determining the project schedule, budget,
personnel assignments, quality requirements, and
risks. As those other functions are planned, items
are commonly identified that should be added to the
WBS.
Some teams create their WBS by hand using the org
chart or free format methods, while others directly type
their WBS into project scheduling software such as
Microsoft Project.
Key Terms Consistent with PMI Standards and Guides
plan scope management, 212
requirement, 212
collect requirements, 212
define scope, 217
define activity, 221
work package, 224
WBS component, 225
WBS dictionary, 225
rolling wave planning, 227
baseline, 229
decomposition, 228
change control system, 229
change request, 231
Chapter Review Questions
1. What is the first step in developing a project
scope management plan?
2. What three tasks comprise the “define scope”
process?
3. For a construction project, the house is the
deliverable, and how-to instruc-
tion sheets are deliverables.
4. Why is scope definition important?
5. What are two common causes of scope creep?
6. What does the acronym WBS stand for?
7. What are the advantages of using a WBS?
8. List three ways of organizing a WBS.
9. The lowest level of the WBS is known as a(n)
.
10. What is a WBS dictionary used for?
11. What is rolling wave planning?
12. What is uncontrolled change known as?
13. Why do project teams use change control
systems?
14. List the major sections that should be included in a
change request form, and tell why each is important.
15. What is a project baseline?
Discussion Questions
1. Are the product scope and project scope ever
the same? Cite examples to support your
answer.
2. Create a template of a change request form.
What sections did you include and why?
Chapter 7 Scope Planning 239
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3. Compare the strengths and weaknesses of the
three formats of constructing a WBS: indented
outline, organizational chart, and free format.
4. Give an example of scope creep from one of your
own projects or from a project that has made the
news in recent years.
5. What are the advantages of completing the
“define activity” process after creating the
WBS?
6. Describe the roles various executives, managers,
and associates play in scope planning.
7. You are the project manager in charge of
expanding a popular restaurant. How could you
use voice of the customer (VOC) techniques to
gain insight into your stakeholders?
8. Identify two projects your company or school
will be performing in the future. Which one
do you think will have a more detailed WBS?
Why?
9. The sponsor for a project you have been managing
sends you an e-mail that he would like to make a
small change to the project. What is your response
and why?
10. A potential client wants you to be project man-
ager for the construction of a new house, but she
is vague about the details. List a few questions
you could ask her to gain a better understanding
of the scope of the project.
PMBOK ® Guide Questions
1. The process where project deliverables and proj-
ect work are subdivided into smaller and smaller
pieces is called .
a. collect requirements
b. define scope
c. plan scope management
d. create WBS
2. The project scope baseline consists of the approved
versions of three of the four documents listed
below. Which of these documents is not included
in the project scope baseline?
a. project scope statement
b. project charter
c. work breakdown structure (WBS)
d. WBS dictionary
3. Which of the following statements about a work
package is true?
a. It requires the work of the entire project team.
b. It is the responsibility of the project manager.
c. It is the lowest level of the WBS.
d. It consists of a single activity.
4. During WBS creation on a large, complex proj-
ect, the product and project deliverables are
broken down into progressively lower levels of
detail. Once the WBS has been defined at the
second or third level of detail, whose input is
essential in order to break down the work
further?
a. sponsor
b. subject matter experts
c. internal stakeholders
d. external stakeholders
5. Which of the following is not a common method
for organizing a WBS?
a. free format
b. indented outline
c. hierarchical
d. cross-functional
6. A “component of the project management plan
that describes how the scope will be defined,
developed, monitored, controlled, and verified”
is the .
a. project statement of work
b. requirements management plan
c. scope management plan
d. WBS dictionary
7. A grid that links product requirements from their
origins (e.g., business reason needed, stakeholder
who requested them) to the deliverables that satisfy
them is referred to as a .
a. network diagram
b. Gantt chart
c. requirements traceability matrix
d. stakeholder register
8. Which of these is not a component of a Project
Scope Statement?
a. summary budget
b. project deliverables
c. acceptance criteria
d. project exclusions or boundaries
240 Part 3 Planning Projects
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9. The key output of the scope planning process is
an approved version of the scope baseline.
After this baseline is established, it can be
referenced during project execution in order
to .
a. staff the project properly with the right skill
sets
b. link requirements back to their origins
c. communicate with stakeholders effectively
d. identify changes in scope that will go through
formal change control procedures
10. The process of breaking the WBS into smaller
and smaller deliverables is called:
a. decomposition
b. functional design
c. detailed specifications
d. value engineering
Exercises
1. Create a requirements traceability matrix like
Exhibit 7.2 for a project in which you plan an
event on your campus.
2. Create a scope statement like Exhibit 7.3 for a proj-
ect in which you plan an event on your campus.
3. Construct a WBS in indented outline format like
Exhibit 7.11 for a project in which you plan an
event on your campus. Be sure to number each
row. Also, construct the same WBS in MS Project
like Exhibit 7.18.
I N T E G R A T E D E X A M P L E P R O J E C T S
SUBURBAN HOMES CONSTRUCTION PROJECT
Refer to the project charter from Chapter 3. The initial scope
as identified in the project charter is mentioned below:
Building a single-family, partially custom-designed home as
required by Mrs. and Mr. John Thomas on Strath Dr., Alpharetta,
Georgia. The single-family home will have the following features:
3,200 square-feet home with 4 bedrooms and 2.5 bathrooms
Flooring hard wood in the first floor, tiles in the kitchen
and bathrooms, carpet in bedrooms
Granite kitchen countertops, GE appliances in the kitchen
3-car garage and external landscaping
Ceiling 10 in first floor and vaulted 9 ceilings in bedrooms
Summary Milestone Schedule
Approval of final drawing and all the options: 02 January
2017
Land preparation, landscape, and foundation: 15 January
2017
External work completion and utilities hookup: 03 April 2017
Internal and external finish work, appliances, and painting:
10 May 2017
County clearance and Certificate of Occupancy: 30 May 2017
Financial settlement and handover of the property: 21 June
2017
High-Level Assumptions and Constraints
List of options are limited and cost of the house would vary
based on options selected
Client must choose one model among the models
offered
Seven-year warranty for structure and two-year warranty
for finishing components
When this charter was developed, Suburban Homes did not
have complete information on all the customer requirements
and needs and complete understanding of the project. The
company realizes that the milestone schedule is not accurate
and will be subject to changes.
Tasks to Complete
You are asked to obtain requirements from the client. To
do so, Suburban Homes requests that you develop a
Requirements Template that will capture all the needs
of the client. Then, Suburban Homes will have complete
information to develop a scope plan.
Develop a scope statement along with inclusions, exclu-
sions, assumptions, and constraints.
Develop a deliverable-based (design-focused) Work Break-
down Structure (WBS) for this project.
Chapter 7 Scope Planning 241
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Semester Project Instructions
For your example project, create the following:
1. Scope management plan to direct your efforts
2. Requirements traceability matrix like Exhibit 7.2 to
understand customer desires
3. Scope statement like Exhibit 7.3
4. Change request form like Exhibit 7.13
5. WBS first using either the free format or the org
chart format like Exhibits 7.5 and 7.6
6. WBS in MS Project like Exhibit 7.18
CASA DE PAZ DEVELOPMENT PROJECT
Note that this is a larger project and from this point forward
in the book, we will focus on the features and the work for
the Promotion and Community Relations Working Group
only. The Development and Fundraising Working Group
and the Program Development Working Groups are concur-
rently performing similar planning and executing of the proj-
ect. The work within each group is planned and executed
primarily by the team members with the project manager
(scrum manager) removing roadblocks and coordinating
between groups.
The Promotion and Community Relations Working Group
needs to:
1. Document the requirements needed by the users of the
project deliverables.
2. Determine what work will be included and what will be
excluded.
3. Organize everything into a product backlog that can be
used for all subsequent planning.
These three actions can be accomplished in a facilitated
meeting by first asking the question: To open on time on Octo-
ber 1, what are the three to five most important things that need
to be created? To make it easier for your practice, the project
team chose the following five features of the project:
Features of the Project:
Website
Location/building
Partnerships/sponsors
Communication methods
Joint venture (between university and Casa de Paz)
Now, for each feature, what details do you believe need
to be accomplished to create the features? These are the
stories. The features and supporting stories form the scope
of this project and will be in the backlog until selected for
work in a given iteration.
PROJECT MANAGEMENT IN ACTION
Work Breakdown Structure Template
This WBS for an industrial complex presents a
deliverable-oriented approach to developing it by
employing a consistency in the division basis for each
level of the WBS. Usually, we can develop a deliverable
WBS using function, product, or physical location.
However, within a level of WBS, we must employ only
one of these to develop WBS into the next level. The
first-level division basis is physical as an industrial
complex is divided into a powerhouse, factory, office,
and grounds. The division basis for the second level of
242 Part 3 Planning Projects
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References
1233-1998 – IEEE Guide for Developing System
Requirements Specifications, http://ieeexplore.ieee.
org/document/741940/.
A Guide to the Project Management Body of Knowledge
(PMBOK® Guide), 5th ed. (Newtown Square, PA:
Project Management Institute, 2013).
Caudle, Gerrie, Streamlining Business Requirements:
The XCellR8 Approach (Vienna, VA: Management
Concepts, Inc., 2009).
Collyer, Simon, Clive Warren, Bronwyn Hemsley,
and Chris Stevens , “Aim, Fire, Aim—Project
Planning Styles in Dynamic Environments,”
Project Management Journal (September 2010):
41 (4): 106–121.
Fister Gale, Sarah, “The Evolution of Agile,” PMNetwork
26 (1) (January 2012): 28–33.
Hass, Kathleen B., Don Wessels, and Kevin
Brennan, Getting It Right: Business Requirement
Analysis Tools and Techniques Structures
(Vienna, VA: Management Concepts, Inc., 2008).
Haugan, Gregory T., Effective Work Breakdown Structures
(Vienna, VA: Management Concepts, Inc., 2002).
Howard, Dale, and Gary Chefetz, What’s New Study
Guide Microsoft Project 2010 (New York: Chefetz
LLC dba MSProjectExperts, 2010).
Hunsberger, Kelley, “Change Is Good: For Agile
Projects, Redefining Scope Isn’t Such a Creepy
Thing,” PMNetwork (February 2011)
25 (2): 48–53.
Miller, Dennis P. Building a Project Work Breakdown
Structure: Visualizing Objectives, Deliverables,
Activities, and Schedules (Boca Raton, FL: CRC
Press, 2009).
Project Management Institute Practice Standard
for Work Breakdown Structures, 2nd ed.
(Newtown Square, PA: Project Management
Institute, 2006).
Rad, Parviz, and Vittal Anantatmula, Integrated Project
Planning (Berkeley Heights, NJ: Project Management
Excellence, 2009).
Rad, Parviz, and Vittal Anantatmula, Project Planning
Techniques (Vienna, VA: Management Concepts,
Inc., 2005).
Turk, Wayne, “Scope Creep Horror: It’s Scarier than
Movie Monsters,” Defense AT&L (March–April
2010): 53–55.
Warner, Paul, and Paul Cassar, “Putting Together a
Work Breakdown Structure,” in David I. Cleland,
Field Guide to Project Management, 2nd ed.
(Hoboken, NJ: John Wiley & Sons, 2004).
the Powerhouse is a functional basis as it is divided
into a steam-generation system, electrical-generation
system, and electrical-transmission system. The divi-
sion basis for the second level of the Factory is a
product basis as it is divided into receiving equipment,
processing equipment, and packaging equipment. The
second level of WBS for the Office is a physical basis
as it is divided into first floor, second floor, and third
floor. Finally, the division basis for Grounds is again
a product-basis division as it is divided into shrubs and
trees, lawn, walkways, and a parking lot. This WBS is
focused on the what aspect of the project and not on
how we execute the project. Essentially, this WBS is
developed from the client s perspective and not from
the project team s perspective, which is focused on
how the project is likely to be executed (schedule-
oriented WBS).
Vittal Anantatmula, PMP, PhD.
Chapter 7 Scope Planning 243
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C H A P T E R 8
Scheduling Projects
Scheduling and Agile
The need to comply with government regulations by mandated deadlines does not
change when a company switches from waterfall to Agile. And Agile organizations
still suffer by not having enough time to deliver what s been requested at a reasonable
cost. But I ve worked with people who mistakenly think Agile makes project manage-
ment principles irrelevant. Or that the Agile methodology is incompatible with con-
cepts like Schedule, Scope, and Cost. Communicating with team members and
sponsors with those beliefs has been quite challenging for me as a project manager.
One of my colleagues tells organizations they have these options for manag-
ing a project s triple constraint no matter what methodology is used Agile,
waterfall, or hybrid:
Scope-driven: deliver what is requested no matter how long it takes (Sched-
ule) or how much it Costs
Schedule-driven: meet the deadline by
Delivering whatever Scope you can within the budget (Cost)
Ra
yw
oo
/S
hu
tte
rs
to
ck
.c
om
CHAPTER OBJECTIVES
After completing this
chapter, you should
be able to:
CORE OBJECTIVES:
Describe five ways in
which a project s
schedule is limited and
how to deal with each.
Use the activity on node
(AON)method to develop
a project schedule.
Identify the critical path
using both the two-
pass and enumeration
methods, and identify
all float.
Depict a project sched-
ule on a Gantt chart by
hand, showing the criti-
cal path and all float.
TECHNICAL OBJECTIVES:
Describe how to adjust
a project s sequence
logic using leads, lags,
and alternative
dependencies.
Build and display the
logical network dia-
gram showing critical
path and all float with
MS Project 2016.
Depict a project sched-
ule on a Gantt chart
using MS Project 2016,
showing the critical path
and all float.
BEHAVIORAL OBJECTIVES:
Describe potential pro-
blems in estimating time
accurately and how to
overcome them.
Resolve potential
scheduling conflicts.
244
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Investing as many resources as needed (Cost) to deliver the Scope
Cost-driven: deliver whatever Scope you can until the budget is exhausted.
Your Schedule ends when the money runs out.
I ve been on projects companies decided should be schedule-driven, but team
members delivered as though they were scope-driven and sponsors monitored
like they were cost-driven. In these circumstances, I ve had to keep reminding
people what option was chosen for the project, and why, throughout its duration,
sometimes years. And this communication has been vitally important to manag-
ing the schedule.
Agile has made some of my projects easier to schedule and others a lot
more difficult! With a software manufacturer using a single team for each of
its products, the developers themselves took more ownership of the schedule.
On the job, they learned how to estimate activities better and apply dependen-
cies, leads, lags, and float within their daily stand-ups. The teams were on the
same iteration cycles, so ceremonies like sprint retrospectives naturally became
milestones in the project schedule, on cadences familiar to the folks doing the
work.
But I ve also been on projects where Agile, waterfall, and hybrid teams
from different organizations were dependent on one another to deliver results.
Not only did the varying methodologies and terminologies hamper scheduling
but our Agile teams iteration cycles also were completely different. So once
we d identified activities, sequenced them, identified mandatory dependen-
cies and figured out whether they were FS, FF, SS, or SF, there were gaps
caused by teams varying iterations that extended schedule duration with no
corresponding benefits. And that was just in the planning stage: different geo-
graphic locations, vocabulary, iterations, and systems made the schedule vir-
tually unmanageable because communicating changes to it was nearly
impossible. Luckily, everyone decided to align on a common iteration cycle,
which went a long way toward solving our problems. But that is not always
possible.
Investing team members in a project s schedule beyond just completing their
own activities has always been a challenge for me, but Agile has made that even
tougher. People feel they are succeeding as long as they make incremental prog-
ress every day, but they can do that while our team still fails to meet the sched-
ule. That s why continuing to study this chapter, and discussing its content with
other project managers, is important to me.
Carol A. Abbott, PMP
4.2 Develop Project Management Plan
Network
Schedule
Baseline
Duration
Estimates
Activity List
Milestone List
PM Plan
Baselines
6.1 Plan
Schedule
Management
6.3
Sequence
Activities 6.5 Develop
Schedule
6.2 Define
Activities
6.4 Estimate
Activity
Durations
PMBOK® GUIDE
Topics:
Develop project man-
agement plan
Plan schedule
management
Define activities
Sequence activities
Estimate activity
durations
Develop schedule
CHAPTER OUTPUTS
Activity list
Milestone list
Network
Duration estimates
Schedule baseline
245
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8-1 Plan Schedule Management
As is true of other project planning knowledge areas, planning for time is iterative. A
project manager and team usually develop as much of the schedule as they can based
upon the information in the work breakdown structure (WBS). The communication
plan, requirements traceability matrix, and scope statement are often either complete or
at least in draft form at this point. Once a project is scheduled, the budget can be formu-
lated, resource needs can be identified and resources assigned, risks can be identified and
plans developed to deal with the identified risks, and a quality management plan can be
created. In many projects, these are not all treated as discrete activities, and some of
them may be performed together. However, for clarity, each of these planning processes
will be described individually.
The building blocks of a project schedule are activities. An activity is “a component of
project scope work performed during the course of a project.”1 For activities to be useful
as schedule building blocks, they should have the following characteristics:
Clear starting and ending points
Tangible output that can be verified
Scope small enough to understand and control without micromanaging
Resources, other costs, and schedule that can be estimated and controlled
A single person who can be held accountable for each activity (Often more than
one person is required to complete the work; however, one person should be
responsible.)2
Since activities represent work that needs to be performed, they should be listed in a
verb-noun format, such as “prepare budget,” “build frame,” “test code,” “transmit infor-
mation,” “analyze data,” and “develop plan.” Each activity should be clearly differentiated
from other activities, so it is often helpful to write the activities in verb-adjective-noun
format, such as “write draft report” and “write final report.”
The Project Management Institute (PMI) has divided project time management into
the following seven work processes.
1. Plan schedule management—arranging how to develop, manage, execute, and con-
trol the project schedule
2. Define activities—a project planning process that identifies and determines specific
actions to develop and deliver the project outcomes, such as products, services, or
results
3. Sequence activities—determining the predecessor and successor relationships among
the project activities
4. Estimate activity durations—the process of approximating the number of work per-
iods needed to complete individual activities with estimated resources3
5. Develop schedule—the process of analyzing activity sequences, durations, resource
requirements, and schedule constraints to create the project schedule4
6. Control schedule—the process of regulating changes to the project schedule5
Planning schedule management, defining activities, sequencing activities, estimating
activity durations, and part of developing schedules will be covered in this chapter. The
remainder of developing schedules will be discussed in Chapter 9 (Resourcing Project
Activities). Chapter 14 (Determining Project Progress and Results) will focus on control-
ling the schedule.
246 Part 3 Planning Projects
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8-2 Purposes of a Project Schedule
Projects are undertaken to accomplish important business purposes, and people often
want to use the project results as quickly as possible. Many specific questions such as
the following can be answered by having a complete and workable schedule:
When will the project be complete?
What is the earliest date a particular activity can start, and when will it end?
What activity must begin before which other activities can take place?
What would happen if a delivery of material were one week late?
Can a key worker take a week of vacation the first week of March?
If one worker is assigned to do two activities, which one must go first?
How many hours do we need from each worker next week or month?
Which worker or oth