Project management is the process and activity of planning, organizing, motivating, and controlling resources to achieve specific goals. A project is a temporary endeavor designed to produce a unique product, service or result  with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverables), undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value. The temporary nature of projects stands in contrast with business as usual (or operations), which are repetitive, permanent, or semi-permanent functional activities to produce products or services. In practice, the management of these two systems is often quite different, and as such requires the development of distinct technical skills and management strategies.
The primary challenge of project management is to achieve all of the project goals and objectives while honoring the preconceived constraints. The primary constraints are scope, time, quality and budget. The secondary —and more ambitious— challenge is to optimize the allocation of necessary inputs and integrate them to meet pre-defined objectives.
- 1 History
- 2 Approaches
- 3 Processes
- 4 Topics
- 5 See also
- 6 References
- 7 External links
Until 1900 civil engineering projects were generally managed by creative architects, engineers, and master builders themselves, for example Vitruvius (first century BC), Christopher Wren (1632–1723), Thomas Telford (1757–1834) and Isambard Kingdom Brunel (1806–1859). It was in the 1950s that organizations started to systematically apply project management tools and techniques to complex engineering projects.
As a discipline, project management developed from several fields of application including civil construction, engineering, and heavy defense activity. Two forefathers of project management are Henry Gantt, called the father of planning and control techniques, who is famous for his use of the Gantt chart as a project management tool (alternatively Harmonogram first proposed by Karol Adamiecki); and Henri Fayol for his creation of the five management functions that form the foundation of the body of knowledge associated with project and program management. Both Gantt and Fayol were students of Frederick Winslow Taylor's theories of scientific management. His work is the forerunner to modern project management tools including work breakdown structure (WBS) and resource allocation.
The 1950s marked the beginning of the modern project management era where core engineering fields come together to work as one. Project management became recognized as a distinct discipline arising from the management discipline with engineering model. In the United States, prior to the 1950s, projects were managed on an ad-hoc basis, using mostly Gantt charts and informal techniques and tools. At that time, two mathematical project-scheduling models were developed. The "Critical Path Method" (CPM) was developed as a joint venture between DuPont Corporation and Remington Rand Corporation for managing plant maintenance projects. And the "Program Evaluation and Review Technique" or PERT, was developed by Booz Allen Hamilton as part of the United States Navy's (in conjunction with the Lockheed Corporation) Polaris missile submarine program;
PERT and CPM are very similar in their approach but still present some differences. CPM is used for projects that assume deterministic activity times; the times at which each activity will be carried out are known. PERT, on the other hand, allows for stochastic activity times; the times at which each activity will be carried out are uncertain or varied. Because of this core difference, CPM and PERT are used in different contexts. These mathematical techniques quickly spread into many private enterprises.
At the same time, as project-scheduling models were being developed, technology for project cost estimating, cost management, and engineering economics was evolving, with pioneering work by Hans Lang and others. In 1956, the American Association of Cost Engineers (now AACE International; the Association for the Advancement of Cost Engineering) was formed by early practitioners of project management and the associated specialties of planning and scheduling, cost estimating, and cost/schedule control (project control). AACE continued its pioneering work and in 2006 released the first integrated process for portfolio, program and project management (Total Cost Management Framework).
The International Project Management Association (IPMA) was founded in Europe in 1967, as a federation of several national project management associations. IPMA maintains its federal structure today and now includes member associations on every continent except Antarctica. IPMA offers a Four Level Certification program based on the IPMA Competence Baseline (ICB). The ICB covers technical, contextual, and behavioral competencies.
In 1969, the Project Management Institute (PMI) was formed in the USA. PMI publishes A Guide to the Project Management Body of Knowledge (PMBOK Guide), which describes project management practices that are common to "most projects, most of the time." PMI also offers multiple certifications.
There are a number of approaches to managing project activities including lean, iterative, incremental, and phased approaches.
Regardless of the methodology employed, careful consideration must be given to the overall project objectives, timeline, and cost, as well as the roles and responsibilities of all participants and stakeholders.
The traditional approach
A traditional phased approach identifies a sequence of steps to be completed. In the "traditional approach", five developmental components of a project can be distinguished (four stages plus control):
- planning and design
- execution and construction
- monitoring and controlling systems
Not all projects will have every stage, as projects can be terminated before they reach completion. Some projects do not follow a structured planning and/or monitoring process. And some projects will go through steps 2, 3 and 4 multiple times.
Many industries use variations of these project stages. For example, when working on a brick-and-mortar design and construction, projects will typically progress through stages like pre-planning, conceptual design, schematic design, design development, construction drawings (or contract documents), and construction administration. In software development, this approach is often known as the waterfall model, i.e., one series of tasks after another in linear sequence. In software development many organizations have adapted the Rational Unified Process (RUP) to fit this methodology, although RUP does not require or explicitly recommend this practice. Waterfall development works well for small, well defined projects, but often fails in larger projects of undefined and ambiguous nature. The Cone of Uncertainty explains some of this as the planning made on the initial phase of the project suffers from a high degree of uncertainty. This becomes especially true as software development is often the realization of a new or novel product. In projects where requirements have not been finalized and can change, requirements management is used to develop an accurate and complete definition of the behavior of software that can serve as the basis for software development. While the terms may differ from industry to industry, the actual stages typically follow common steps to problem solving—"defining the problem, weighing options, choosing a path, implementation and evaluation."
PRINCE2 is a structured approach to project management released in 1996 as a generic project management method. It combines the original PROMPT methodology (which evolved into the PRINCE methodology) with IBM's MITP (managing the implementation of the total project) methodology. PRINCE2 provides a method for managing projects within a clearly defined framework.
PRINCE2 focuses on the definition and delivery of products, in particular their quality requirements. As such, it defines a successful project as being output-oriented (not activity- or task-oriented) through creating an agreed set of products that define the scope of the project and provides the basis for planning and control, that is, how then to coordinate people and activities, how to design and supervise product delivery, and what to do if products and therefore the scope of the project has to be adjusted if it does not develop as planned.
In the method, each process is specified with its key inputs and outputs and with specific goals and activities to be carried out to deliver a project's outcomes as defined by its Business Case. This allows for continuous assessment and adjustment when deviation from the Business Case is required.
PRINCE2 provides a common language for all participants in the project. The governance framework of PRINCE2 – its roles and responsibilities – are fully described and require tailoring to suit the complexity of the project and skills of the organisation.
Critical chain project management
Critical chain project management (CCPM) is a method of planning and managing project execution designed to deal with uncertainties inherent in managing projects, while taking into consideration limited availability of resources (physical, human skills, as well as management & support capacity) needed to execute projects.
CCPM is an application of the theory of constraints (TOC) to projects. The goal is to increase the flow of projects in an organization (throughput). Applying the first three of the five focusing steps of TOC, the system constraint for all projects is identified as are the resources. To exploit the constraint, tasks on the critical chain are given priority over all other activities. Finally, projects are planned and managed to ensure that the resources are ready when the critical chain tasks must start, subordinating all other resources to the critical chain.
The project plan should typically undergo resource leveling, and the longest sequence of resource-constrained tasks should be identified as the critical chain. In some cases, such as managing contracted sub-projects, it is advisable to use a simplified approach without resource leveling.
In multi-project environments, resource leveling should be performed across projects. However, it is often enough to identify (or simply select) a single "drum". The drum can be a resource that acts as a constraint across projects, which are staggered based on the availability of that single resource.
One can also use a "virtual drum" by selecting a task or group of tasks (typically integration points) and limiting the number of projects in execution at that stage.
Event chain methodology
Event chain methodology is an uncertainty modeling and schedule network analysis technique that is focused on identifying and managing events and event chains that affect project schedules. Event chain methodology helps to mitigate the negative impact of psychological heuristics and biases, as well as to allow for easy modeling of uncertainties in the project schedules. Event chain methodology is based on the following principles.
- Probabilistic moment of risk: An activity (task) in most real-life processes is not a continuous uniform process. Tasks are affected by external events, which can occur at some point in the middle of the task.
- Event chains: Events can cause other events, which will create event chains. These event chains can significantly affect the course of the project. Quantitative analysis is used to determine a cumulative effect of these event chains on the project schedule.
- Critical events or event chains: The single events or the event chains that have the most potential to affect the projects are the “critical events” or “critical chains of events.” They can be determined by the analysis.
- Project tracking with events: Even if a project is partially completed and data about the project duration, cost, and events occurred is available, it is still possible to refine information about future potential events and helps to forecast future project performance.
- Event chain visualization: Events and event chains can be visualized using event chain diagrams on a Gantt chart.
Also furthering the concept of project control is the incorporation of process-based management. This area has been driven by the use of Maturity models such as the CMMI (capability maturity model integration; see this example of a predecessor) and ISO/IEC15504 (SPICE – software process improvement and capability estimation).
Agile project management
Agile project management approaches, based on the principles of human interaction management, are founded on a process view of human collaboration. It is "most typically used in software, website, technology, creative and marketing industries." This contrasts sharply with the traditional approach. In the agile software development or flexible product development approach, the project is seen as a series of relatively small tasks conceived and executed to conclusion as the situation demands in an adaptive manner, rather than as a completely pre-planned process. Advocates of this technique claim that:
- It is the most consistent project management technique since it involves frequent testing of the project under development.
- It is the only technique in which the client will be actively involved in the project development.
- The only disadvantage with this technique is that it should be used only if the client has enough time to be actively involved in the project every now and then.
Examples of Agile Project Management tools and techniques include:
- Scrum (software development) - A holistic approach to development that focuses on iterative goals set by the Product Owner through a backlog, which is developed by the Delivery Team through the facilitation of the Scrum Master.
- Extreme Programming (XP) - Also called Pair Programming this method uses small groups and has a highly prescriptive Test Driven Development (TDD) model.
- eXtreme Manufacturing (XM) - An agile methodology based on Scrum, Kanban and Kaizen that facilitates rapid engineering and prototyping.
- Crystal Clear (software development) - An agile or lightweight methodology that focuses on colocation and osmotic communication.
- Kanban (かんばん(看板)?) - A lean framework for process improvement that is frequently used to manage WIP within agile projects. The Kanban process improvement framework has been specifically applied to software development, as Kanban (development).
Lean project management
Lean project management uses the principles from lean manufacturing to focus on delivering value with less waste and reduced time.
Extreme project management
In critical studies of project management it has been noted that several PERT based models are not well suited for the multi-project company environment of today. Most of them are aimed at very large-scale, one-time, non-routine projects, and currently all kinds of management are expressed in terms of projects.
Using complex models for "projects" (or rather "tasks") spanning a few weeks has been proven to cause unnecessary costs and low maneuverability in several cases. The generalization of Extreme Programming to other kinds of projects is extreme project management, which may be used in combination with the process modeling and management principles of human interaction management.
Benefits realization management
Benefits realization management (BRM) enhances normal project management techniques through a focus on outcomes (the benefits) of a project rather than products or outputs, and then measuring the degree to which that is happening to keep a project on track. This can help to reduce the risk of a completed project being a failure by delivering agreed upon requirements/outputs but failing to deliver the benefits of those requirements.
An example of delivering a project to requirements might be agreeing to deliver a computer system that will process staff data and manage payroll, holiday and staff personnel records. Under BRM the agreement might be to achieve a specified reduction in staff hours required to process and maintain staff data.
Traditionally, project management includes a number of elements: four to five process groups, and a control system. Regardless of the methodology or terminology used, the same basic project management processes will be used. Major process groups generally include:
- Planning or design
- Production or execution
- Monitoring and controlling
In project environments with a significant exploratory element (e.g., research and development), these stages may be supplemented with decision points (go/no go decisions) at which the project's continuation is debated and decided. An example is the Phase–gate model.
The initiating processes determine the nature and scope of the project. If this stage is not performed well, it is unlikely that the project will be successful in meeting the business’ needs. The key project controls needed here are an understanding of the business environment and making sure that all necessary controls are incorporated into the project. Any deficiencies should be reported and a recommendation should be made to fix them.
The initiating stage should include a plan that encompasses the following areas:
- analyzing the business needs/requirements in measurable goals
- reviewing of the current operations
- financial analysis of the costs and benefits including a budget
- stakeholder analysis, including users, and support personnel for the project
- project charter including costs, tasks, deliverables, and schedule
Planning and design
After the initiation stage, the project is planned to an appropriate level of detail (see example of a flow-chart). The main purpose is to plan time, cost and resources adequately to estimate the work needed and to effectively manage risk during project execution. As with the Initiation process group, a failure to adequately plan greatly reduces the project's chances of successfully accomplishing its goals.
- determining how to plan (e.g. by level of detail or rolling wave);
- developing the scope statement;
- selecting the planning team;
- identifying deliverables and creating the work breakdown structure;
- identifying the activities needed to complete those deliverables and networking the activities in their logical sequence;
- estimating the resource requirements for the activities;
- estimating time and cost for activities;
- developing the schedule;
- developing the budget;
- risk planning;
- gaining formal approval to begin work.
Additional processes, such as planning for communications and for scope management, identifying roles and responsibilities, determining what to purchase for the project and holding a kick-off meeting are also generally advisable.
For new product development projects, conceptual design of the operation of the final product may be performed concurrent with the project planning activities, and may help to inform the planning team when identifying deliverables and planning activities.
Executing consists of the processes used to complete the work defined in the project plan to accomplish the project's requirements. Execution process involves coordinating people and resources, as well as integrating and performing the activities of the project in accordance with the project management plan. The deliverables are produced as outputs from the processes performed as defined in the project management plan and other frameworks that might be applicable to the type of project at hand.
Execution process group include:
- Direct and manage project execution
- Quality assurance of deliverables
- Acquire, develop and manage Project team
- Distribute information
- Manage stakeholder expectations
- Conduct procurement
- Test the deliverables against the initial design
Monitoring and Controlling
Monitoring and controlling consists of those processes performed to observe project execution so that potential problems can be identified in a timely manner and corrective action can be taken, when necessary, to control the execution of the project. The key benefit is that project performance is observed and measured regularly to identify variances from the project management plan.
Monitoring and controlling includes:
- Measuring the ongoing project activities ('where we are');
- Monitoring the project variables (cost, effort, scope, etc.) against the project management plan and the project performance baseline (where we should be);
- Identify corrective actions to address issues and risks properly (How can we get on track again);
- Influencing the factors that could circumvent integrated change control so only approved changes are implemented.
In multi-phase projects, the monitoring and control process also provides feedback between project phases, in order to implement corrective or preventive actions to bring the project into compliance with the project management plan.
Project maintenance is an ongoing process, and it includes:
- Continuing support of end-users
- Correction of errors
- Updates of the software over time
In this stage, auditors should pay attention to how effectively and quickly user problems are resolved.
Over the course of any construction project, the work scope may change. Change is a normal and expected part of the construction process. Changes can be the result of necessary design modifications, differing site conditions, material availability, contractor-requested changes, value engineering and impacts from third parties, to name a few. Beyond executing the change in the field, the change normally needs to be documented to show what was actually constructed. This is referred to as change management. Hence, the owner usually requires a final record to show all changes or, more specifically, any change that modifies the tangible portions of the finished work. The record is made on the contract documents – usually, but not necessarily limited to, the design drawings. The end product of this effort is what the industry terms as-built drawings, or more simply, “as built.” The requirement for providing them is a norm in construction contracts.
When changes are introduced to the project, the viability of the project has to be re-assessed. It is important not to lose sight of the initial goals and targets of the projects. When the changes accumulate, the forecasted result may not justify the original proposed investment in the project.
Closing includes the formal acceptance of the project and the ending thereof. Administrative activities include the archiving of the files and documenting lessons learned.
This phase consists of:
- Contract closure: Complete and settle each contract (including the resolution of any open items) and close each contract applicable to the project or project phase.
- Project close: Finalize all activities across all of the process groups to formally close the project or a project phase
Project controlling and project control systems
Project controlling should be established as an independent function in project management. It implements verification and controlling function during the processing of a project in order to reinforce the defined performance and formal goals. The tasks of project controlling are also:
- the creation of infrastructure for the supply of the right information and its update
- the establishment of a way to communicate disparities of project parameters
- the development of project information technology based on an intranet or the determination of a project key performance index system (KPI)
- divergence analyses and generation of proposals for potential project regulations
- the establishment of methods to accomplish an appropriate project structure, project workflow organization, project control and governance
- creation of transparency among the project parameters
Fulfillment and implementation of these tasks can be achieved by applying specific methods and instruments of project controlling. The following methods of project controlling can be applied:
- investment analysis
- cost–benefit analyses
- value benefit Analysis
- expert surveys
- simulation calculations
- risk-profile analyses
- surcharge calculations
- milestone trend analysis
- cost trend analysis
Project control is that element of a project that keeps it on-track, on-time and within budget. Project control begins early in the project with planning and ends late in the project with post-implementation review, having a thorough involvement of each step in the process. Each project should be assessed for the appropriate level of control needed: too much control is too time consuming, too little control is very risky. If project control is not implemented correctly, the cost to the business should be clarified in terms of errors, fixes, and additional audit fees.
Control systems are needed for cost, risk, quality, communication, time, change, procurement, and human resources. In addition, auditors should consider how important the projects are to the financial statements, how reliant the stakeholders are on controls, and how many controls exist. Auditors should review the development process and procedures for how they are implemented. The process of development and the quality of the final product may also be assessed if needed or requested. A business may want the auditing firm to be involved throughout the process to catch problems earlier on so that they can be fixed more easily. An auditor can serve as a controls consultant as part of the development team or as an independent auditor as part of an audit.
Businesses sometimes use formal systems development processes. These help assure that systems are developed successfully. A formal process is more effective in creating strong controls, and auditors should review this process to confirm that it is well designed and is followed in practice. A good formal systems development plan outlines:
- A strategy to align development with the organization’s broader objectives
- Standards for new systems
- Project management policies for timing and budgeting
- Procedures describing the process
- Evaluation of quality of change
A project manager is a professional in the field of project management. Project managers can have the responsibility of the planning, execution, and closing of any project, typically relating to construction industry, engineering, architecture, computing, and telecommunications. Many other fields in production engineering and design engineering and heavy industrial have project managers.
A project manager is the person accountable for accomplishing the stated project objectives. Key project management responsibilities include creating clear and attainable project objectives, building the project requirements, and managing the triple constraint for projects, which is cost, time, and scope.
A project manager is often a client representative and has to determine and implement the exact needs of the client, based on knowledge of the firm they are representing. The ability to adapt to the various internal procedures of the contracting party, and to form close links with the nominated representatives, is essential in ensuring that the key issues of cost, time, quality and above all, client satisfaction, can be realized.
Project management types
While Project management, by itself, is a discipline that can apply to any project intended to deliver solutions for any purpose, it is often tailored to accommodate the specific and repeatable needs of different and highly specialized industries. For example, the construction industry, which focuses on the delivery of things like buildings, roads, and bridges, has developed its own specialized form of project management that it refers to as Construction project management and for which project managers can become trained and certified in. The Information technology industry has also evolved to develop its own form of Project management that is referred to as IT Project management and which specializes in the delivery of technical assets and services that are required to pass through various lifecycle phases such as planning, design, development, testing, and deployment. Biotechnology project management focuses on the intricacies of biotechnology research and development.
For each type of project management, project managers develop and utilize repeatable templates that are specific to the industry they're dealing with. This allows project plans to become very thorough and highly repeatable, with the specific intent to increase quality, lower delivery costs, and lower time to deliver project results.
Project management triangle
Like any human undertaking, projects need to be performed and delivered under certain constraints. Traditionally, these constraints have been listed as "scope," "time," and "cost". These are also referred to as the "project management triangle", where each side represents a constraint. One side of the triangle cannot be changed without affecting the others. A further refinement of the constraints separates product "quality" or "performance" from scope, and turns quality into a fourth constraint.
The time constraint refers to the amount of time available to complete a project. The cost constraint refers to the budgeted amount available for the project. The scope constraint refers to what must be done to produce the project's end result. These three constraints are often competing constraints: increased scope typically means increased time and increased cost, a tight time constraint could mean increased costs and reduced scope, and a tight budget could mean increased time and reduced scope.
The discipline of project management is about providing the tools and techniques that enable the project team (not just the project manager) to organize their work to meet these constraints.
Work breakdown structure
The work breakdown structure (WBS) is a tree structure that shows a subdivision of effort required to achieve an objective—for example a program, project, and contract. The WBS may be hardware-, product-, service-, or process-oriented (see an example in a NASA reporting structure (2001)).
A WBS can be developed by starting with the end objective and successively subdividing it into manageable components in terms of size, duration, and responsibility (e.g., systems, subsystems, components, tasks, sub-tasks, and work packages), which include all steps necessary to achieve the objective.
The work breakdown structure provides a common framework for the natural development of the overall planning and control of a contract and is the basis for dividing work into definable increments from which the statement of work can be developed and technical, schedule, cost, and labor hour reporting can be established.
Project management framework
The program (investment) life cycle integrates the project management and system development life cycles with the activities directly associated with system deployment and operation. By design, system operation management and related activities occur after the project is complete and are not documented within this guide (see an example of an IT project management framework).
For example, see figure, in the US United States Department of Veterans Affairs (VA) the program management life cycle is depicted and describe in the overall VA IT Project Management Framework to address the integration of OMB Exhibit 300 project (investment) management activities and the overall project budgeting process. The VA IT Project Management Framework diagram illustrates Milestone 4 which occurs following the deployment of a system and the closing of the project. The project closing phase activities at the VA continues through system deployment and into system operation for the purpose of illustrating and describing the system activities the VA considers part of the project. The figure illustrates the actions and associated artifacts of the VA IT Project and Program Management process.
There have been several attempts to develop project management standards, such as:
- ISO 21500: 2012 - Guidance on project management. This is the first project management ISO.
- ISO 31000: 2009 - Risk management. Risk management is 1 of the 10 knowledge areas of either ISO 21500 or PMBoK5 concept of project management.
- Capability Maturity Model from the Software Engineering Institute.
- GAPPS, Global Alliance for Project Performance Standards – an open source standard describing COMPETENCIES for project and program managers.
- A Guide to the Project Management Body of Knowledge from the Project Management Institute (PMI)
- HERMES method, Swiss general project management method, selected for use in Luxembourg and international organizations.
- The ISO standards ISO 9000, a family of standards for quality management systems, and the ISO 10006:2003, for Quality management systems and guidelines for quality management in projects.
- PRINCE2, PRojects IN Controlled Environments.
- Association for Project Management Body of Knowledge
- Team Software Process (TSP) from the Software Engineering Institute.
- Total Cost Management Framework, AACE International's Methodology for Integrated Portfolio, Program and Project Management.
- V-Model, an original systems development method.
- The Logical framework approach, which is popular in international development organizations.
- IAPPM, The International Association of Project & Program Management, guide to project auditing and rescuing troubled projects.
Project portfolio management
An increasing number of organizations are using, what is referred to as, project portfolio management (PPM) as a means of selecting the right projects and then using project management techniques as the means for delivering the outcomes in the form of benefits to the performing private or not-for-profit organization.
Project management software
Project management software has a capacity to help plan, organize, and manage resource pools and develop resource estimates. Depending the sophistication of the software, resource including estimation and planning, scheduling, cost control and budget management, resource allocation, collaboration software, communication, decision-making, quality management and documentation or administration systems. Today, numerous PC-based project management software packages exist, and they are finding their way into almost every type of business. Software may range from the high-end Microsoft Project to a simple spreadsheet in Microsoft Excel.
Virtual project management
Virtual program management (VPM) is management of a project done by a virtual team, though it rarely may refer to a project implementing a virtual environment It is noted that managing a virtual project is fundamentally different from managing traditional projects, combining concerns of telecommuting and global collaboration (culture, timezones, language).
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- Khazanchi, Deepak (2005). Patterns of Effective Project Management in Virtual Projects: An Exploratory Study. Project Management Institute. ISBN 9781930699830.
- Velagapudi, Mridula (April 13, 2012). "Why You Cannot Avoid Virtual Project Management 2012 Onwards".
- "Virtual Project Management (course)". Global Knowledge.
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|Library resources about
- Guidelines for Managing Projects from the UK Department for Business, Enterprise and Regulatory Reform (BERR)
- Open Source Project Management manual