Principles of Project Management - Example

Principles of Project Management Introduction: Project success is defined by researchers as the completion of an activity within the constraints of time, cost and performance. The three basic conditionalities to be fulfilled for ensuring performance of project management are the fulfillment of conditionality with minimum or mutually agreed upon scope changes, without disturbing the main work flow of the organization and without change in the corporate culture. With the changing demands and needs of the market there has been seen that most of the organizations in the world have changed their management and strategic policies to ensure that greater awareness can be created in the market (Heerkens, 2001). This has been seen to have reaped fruits for almost all the companies around the globe (Catterall, and Maclaran, 2002). But on the other hand there has to be realised that there have been certain companies and organizations which have emerged as global leaders in their field and sphere of influence but have not changed their policies or strategic management a great deal but have employed a persistent policy of organization and functioning (Kai, Choon, Matthew, and Izak, B, 2006). The concepts from the body of project management principles are also applicable in this regard. A project of magnitude requires an outlay of the plan of action or a project management plan right at the initiation of the project. The most important reason for writing the plan out is the fact that it forces the party involved to think the strategy out and helps in the process of decision making at the level of execution. A project plan may require making commitments, and so it can be both a difficult and important part of establishing the project. An efficient system of project management would mean that there are in place the ideas of project phases. Executive Summary: In the following report, one will discuss the affectivity of the use of the principles of project management in the overall change institution in a given organization. For the purpose of the discussion, the report will focus on the principles that define a project well executed and try and measure some of the better known project management instances around the globe on the yardstick thus defined. The idea would be recognize the effect that the institution of a defined set of project management principles would have on the overall tone and tenor change and development management in a given organization. For the purpose of the discussion, one would also analyze the impact that a project ill-executed could have on the overall health of an organization, the lesson to be learnt here would be the fact that in the absence correct implementation of a defined set of project management principles, catastrophe in terms of the project going haywire is inevitable. In all such instances, these principles of project management instead of being a boon, tend to become a bane. For the purpose of the discussion, one would limit oneself to four basic aspects of project management-costing, staffing and scheduling. Also, in the larger context, to define a project that ran completely opposite to the principles of project management, one will look at a dedicated model of project management-the Prince2 Model and define on the lines of this model the failure of project management at Heathrow terminal 5. (Office of Government Commerce, 2005) Projects and Project Management: One needs to understand the fact that very few projects get completed within the original scope of the project-scope changes tend to be inevitable. Beside this there are a number of basic project management principles that should need to be examined. Project management principles need to be understood in a theoretical framework. Not all project management principles can be applicable to all projects. These encompass everything from the project outlay or plan to the delegates that are supposed to work on them, to definition of priorities and the system that would ultimately accommodate everything. The first principle is that of success. The goal of project management is to produce a successful product. The idea is that in terms of priority “in time and on budget” is important but even more important is the success of the product. The latter should not be compromised to fulfill the former. The second principle is the Tetrad-Tradeoff Principle - the core variables of the project management process, namely: product scope, quality grade, time-to-produce and cost-to-complete must all be mutually consistent. (Section 60 Life Cycle Design and Management, 1999.) The Cultural Environment (or Suitability) Principle is also equally important which outlines a process whereby an informed management must provide a supportive cultural environment to enable the project team to produce its best work (Bing, John, A., 1994). The Process Principle outlines the ideal that there must be in place policies and processes that are effective for the fulfillment of the project commitments. Here the role of proper training, familiarization and human resource management comes into focus and finally the Life Cycle Principle sates that planning has to precede implementation. These necessarily need to be sequential. (Werner, A.F. 1991). Staffing during projects   One of the primary factors that affect management of projects in a given organization are the issues with staffing in terms of organization of the project team in office and the site itself. Generally, project office personnel are assigned full time to the project and work out of the project office, while the project team members themselves work out of the functional units and may spend only a small percentage of their time to the project (Walter and Zimmerman 2010). Normally, project office personnel report directly to the project manager, but they may still be solid to their function just for the purpose of administrative control.   Researchers identify two primary types of problems where the project environment personnel management is concerned-personnel performance problem and personnel policy problems. More often than not, the management of the project and its overall implementation is successful only in cases where the project manager and his team are totally dedicated to the successful completion of the project. This requires that each team members of the project team and office have a good understanding of the fundamental of the project and its management (Bach, 2005). These could be defined as being inclusive of factors of consumer liaison, project direction, project planning, project control, evaluation and reporting. Another big staffing decision that the project needs to keep track of is the issue with the selection of the project manager-a decision that is usually taken at the upper echelons of a given project committee (Kerzner, 2004). The point here is that the project manager has to be selected keeping in mind, not just past records and experience but also his aptitude to the project in question. Where staffing for a project is concerned, the process itself is difficult; given especially the nature of the event-which is in fact a short term lull-in between the continuances of work. Interestingly, for most companies in the information technology (IT) sector, management of short term projects is a way of life-given much of the their work is based on short term commissions. In this context a study by found that as a whole, more than ninety percent respondents interviewed said that the use of project managers was a distinct IT staff position. However, there is a positive correlation between the ratio of project managers to IT staff and organization size. (In our study, small companies have annual revenues less than $250 million, medium companies between $250 and 750 million, and large companies in excess of $750 million.) Our analysis indicates that as organizational size increases, the need for IT project managers also increases (IT Project Management Staffing Ratios and PMO Adoption, 2006). Scheduling of the project: In order for a given project to be successful it is important that there is in place a systematic process for the collection and maintenance of data with respect to the project in question. The idea is that in order to support the ongoing management and control of the project, there is a need on the part of the project executors to ensure that there is a collation of data about schedule performance, work effort and expenditures. These help in telling the project manager how to collect analyze and report on these basic project parts of the project’s performance (Portny, 2010). Information systems tend to have technical support from computers, scanners and printers-but information system could also consist of the manual processes and physical data storage devices. The idea therefore is that there is a need, on the part of the project manager to ensure that the he is monitoring the procedures for collecting, storing, analyzing and reporting information-given especially the fact that these could serve to accuracy and timeliness of the project performance assessment. IBM: e-workplace project Where staffing and scheduling is concerned, one of the better known projects, renowned for the manner of its implementation is the IBM internal project linking its various offices and staff-the project was in essence an IT project aimed at effective human resource management. Where the implementation of the IBM e-workplace project was concerned, one has to remember, first and foremost, that the project was in essence an internal Endeavour, aiming to streamline the management of human resources within the company, also aiming to connect the dots of the many personnel that IBM had with its global footprint. (Online, IBM Official Website) What IBM did was that it tried to set up an all employee intranet zone wherein all employees would have access to the fully personalized HR Intranet site so that information and tool regarding careers, skills management, training, development plans, personal data, knowledge management etc could be easily managed and accessed by all (Ruël, Bondarouk and Loosie, 2004). Given the fact that the project was an IT project, IBM made use of its core competencies, in assigning a team of the HR heads situated in US, ensuring that technology solutions that IBM provided to the world were also used internally to project the organization more and more as a global player. In terms of staffing therefore, one sees evidences of the project managers from HR having mingled with the larger group of managers, used to dealing with global projects-the scheduling of the project was realistic, keeping cost constraints in mind. The project was implemented in phases with the first phase being the key phase of the shared service center in UK, opened in September 1998. it was around this service center that the global project revolved(Heneman and Greeenberger, 2002). The effort of change instituted at IBM could be viewed in essence as an effort of downsizing that worked only because of the fact that the new system seeked to institute a change from the unorganized and the largely physical distribution of HR networks to an organized, centralized and a largely technology-based human resource management system. One also sees the use of friendly software and its development and implementation, which meant that staffing, was inclusive of the use of technology that would ease the size of operations at IBM. The project helped IBM in the management of immigration issues and local employment laws, along with tracking long term results. Cost Management Project cost management is easy and yet it is difficult, given especially the fact that it is affected by factors that are often not even in the control of the project managers. The idea therefore is the creation of an effective cost management system on the project-there is no one correct and absolute project cost assessment process that would fit all. The best idea in such cases is to estimate costs or try and define the approximate monetary resources that would be needed for the completion of project activities-guessing should not even be an option. Methods such as the use of expert judgment analogues parametric can be used. Also available is the bottom up approach which requires a detailed view of the project before cost estimates are finalized. All of this is important given the fact that effective control over costs helps run the project according to plan, often in spite of changes, contingencies and work related issues. Cost control could be understood as being the process of monitoring the status of the project to update the project budget and manage changes to the cost baseline.(Ginette B. Basak, P Eng, 2006) One of the better known examples of a project implemented in cost control was IKEA’s project of IT-isation of its supply chain management. The idea in the project was to apply the RFID technology to the supply chain making it more cost effective, for this purpose, IKEA had to undertake a project including test runs, and the global implementation. Cost overruns could include delays in delivery, problems with training of staff and overall resistance and ignorance in the context of the acceptance of technology. (John Curtin, 2007) Factors contributing to success of IKEA supply chain The first thing that IKEA ensured was a good quality low priced product, which was designed and pilot tested extensively in a said facility, ensuring that glitches were identified and costing was worked out. The designers were made to work in a reverse manner given the fact that the target price of a commodity was decided before it went up for designing, so that the designs would be able to accommodate the price restrictions an integrate these within a product of high quality. The second most important aspect of their strategy was arriving at strategic forecasts in all business areas-included strategic and tactical forecasts. Operational level forecasts were made at store levels based on the replenishment orders from the stores.-Long product life cycles, extending to 84 weeks which gave suppliers and designers time space to plan and supplies based on demand forecasts. (Online, The Times 100) Use of Information Technology IKEA used information technology which provided accurate data and other tools to support its planning process. One has to understand in this context that a supply chain cannot be viewed simply as a series of one-to-one, business-to- business links along the chain. There are those that have not been able to embrace e-management practices as part of an integrated supply management approach (Khosrowpour, 2002). The idea in this context therefore should be to ensure that the supply chain is able to keep up with the evolving changes happening in the world of technological advancements. The perfect example in this case is the use RFID technology that many are attempting to integrate within the contemporary SCM processes. The reason of the IKEA success story could therefore be traced back to the fact that computers and technology are able to improve the efficiency of business operations (Khosrowpour, 2002). The idea with IKEA remained therefore, first and foremost that the project remained faithful to the goals keeping which in mind it was first envisaged. Second, the cost aspect of the project, by way of implementation of technology and impediments to the project in the sense of logistical complexities were worked out, before a global implementation plan was rolled out. Hence, it is clear that the application of a principle of cost management is a project management principle that would bring overall value added judgment to a given organization.   Prince2: Model of Project Management The dynamic nature of the business environment has forced organizations in the process industry to experience levels of change never really seen before. Those organizations who fail to manage the inherent risk associated with change, innovation and management of projects often end up with high proportion of projects failures. PRINCE2 is a structured method for effective project management. (Online, Prince2 Official Website) Uncertainty and change are the important factors that underpin the adoption of PRINCE2 methodology by the organizations. There are always lots of changes during the life of the project, people change their minds, and requirements change. The model is a process-driven project management method which contrasts with reactive/adaptive methods that defines 45 separate sub-processes and organizes these into eight processes. The idea behind the project is that every step has to be defined and planned, there has to be a sense of direction and purpose behind the scheduling right from the start of the project, its initiation, its direction and the control of various stages leading up to its implementation, the management of product delivery and of stage boundary finally resulting in the closing of the project.   The dynamic nature of the business environment has forced organizations in the process industry to experience levels of change never really seen before. Those organizations who fail to manage the inherent risk associated with change, innovation and management of projects often end up with high proportion of projects failures. PRINCE2 is a structured method for effective project management. Uncertainty and change are the important factors that underpin the adoption of PRINCE2 methodology by the organizations. (Bellis, P, 2003) There are always lots of changes during the life of the project, people change their minds, and requirements change. The model is a process-driven project management method which contrasts with reactive/adaptive methods that defines 45 separate sub-processes and organizes these into eight processes. (Harrison, F., Lock and Dennis, 2004) The idea behind the project is that every step has to be defined and planned, there has to be a sense of direction and purpose behind the scheduling right from the start of the project, its initiation, its direction and the control of various stages leading up to its implementation, the management of product delivery and of stage boundary finally resulting in the closing of the project. In T5, one of the primary factors of failure could be identified as the lack of effective planning and a complete absence of effective implementation, in cases where the planning was in place. 1. Training been provide to most workers was inadequate. In fact it was admitted by an employee that the responsible personnel was taken into hotel and shown screening of the project in construction in order to familiarize them with the ins and outs of the terminus. Given the new system’s complexity, staff training and preparation were completely absent. This was in fact acknowledged by the staff at British Airways, “In hindsight we should not have absorbed the continuing delays by compromising the time needed to complete the full planning and familiarization process as planned”. 2. It has also been accepted that getting people to understand the new role of technology and buy into the new proposition was the biggest challenge that the project faced. 3. BA blamed the glitches on problems with “staff familiarization”, which had a knock-on effect on bags and flights. A BA spokeswoman said delays in getting staff screened for work and other technical difficulties had caused the airline problems. 4. The baggage load was not handled efficiently, this happened because while the technology was in place, the computer software did not work as it was supposed to. There were technical problems, as the tests on the belt and the baggage system had shown that they were no capable enough to handle the load. This happened primarily because of the fact that the software was mnot tested thoroughly before making it operational. Warning signs were ignored. 5. While work effectiveness was apparent, given the fact that it was completed on time, and within budget, without the death of any of the construction personnel. 6. If the performance of T5 had been in line with those schemes in terms of timing, cost and safety the it would have been 1-2 years late in completing, been 40 per cent above original cost estimates and we would have killed six people says one of the members of the management team. 7. In T5 unlike many other projects the parameters of management and the priorities defined were in place. It was that fact that these priorities were defective to a certain extent that gave rise to the problems. The thrust was on the anticipation of risks than the planning of a process so meticulous that there would not be any risks to consider. This meant that there were compromises that were made on the timeline and effective completion and testing of each stage. At the heart of the terminal 5 agreement is the concept that BAA retains the risk while suppliers work as part of an integrated team to mitigate potential risk and achieve the best possible results. (Points 1 through 7, (House of Commons Transport Committee, 2008) 8. Conclusion: In conclusion, therefore it could be stated that 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. The principles of project management themselves when applies correctly and fully to nay given organization would yield result in the terms of value additions, not just to the organization during the duration of project implementation but in the larger context of improving organizational ethics in general. Reference: Bing, John, A. (1994) Principles of Project Management, PMNETwork, PMI, January, p40 John Curtin, (2007), Making the `MOST' out of RFID technology: a research agenda for the study of the adoption, usage and impact of RFID, Information Technology and Management, Volume 8 , Issue 2, 87 - 110. Ginette B. Basak, P Eng, (2006) Canada "Cost Management in an Imperfect World: Bridging the Gap Between Theory and Practice", Plenary Lecture, Ljubljana, Slovenia Walter, M., and Zimmerman J., (2010). ‘A heuristic approach to project staffing’. Electronic Notes in Discrete Mathematics. 36(1). Pp775-782 Werner, A.F. (1991). Product Lifecycle Assessment: A Strategic Approach. Proceedings of the Global Pollution Prevention ’91 Conference, Washington, D.C.   Kerzner, H., (2004). Project Management: A Systems Approach to Planning, Scheduling, and Controlling. Routledge. p145 Office of Government Commerce, (2005) Managing Successful Projects with PRINCE2, 4th edn, TSO, London Portny, S. E., (2010). Project Management For Dummies. For Dummies Publication. Pp24-30 IT Project Management Staffing Ratios and PMO Adoption, (2006). Retrieved October 6, 2010. < http://www.computereconomics.com/article.cfm?id=1174> Khosrowpour, M, (2002). Issues & trends of information technology management in contemporary. Idea Group. p349  Heerkens G, (2001). Project management. Edition: illustrated, McGraw-Hill Professional. pp156-132’  IKEA, Building a sustainable supply chain, Online at http://www.emu.dk/erhverv/merkantil_caseeksamen/ikea/erhvervs_oekonomi/ikea_supply_chain.pdf, Accessed on November 14 2010. Bach. S., (2005), Managing human resources: personnel management in transition. Edition: 4, illustrated. Wiley-Blackwell, p[210-215  Ruël, H., Bondarouk, T., V., and Loosie, J., K., (2004). E-HRM-- innovation or irritation?: an exploration of web-based human. Pub, A1 books, pp53-55  Heneman, R., L., and Greeenberger, D., B., (2002). Human resource management in virtual organizations. IAP Publications. p53  IBM, Official website, Accessed February 12, 2010, Section 60 Life Cycle Design and Management, CRMP Guide to the Project Management Body of Knowledge, Centre for Research in the Management of Projects, University of Manchester, 1999. House of Commons Transport Committee, The opening of Heathrow Terminal 5, Twelfth Report of Session 2007–08 What is PRINCE2? - PRINCE2 Definition, Online at http://www.prince2.com/what-is-prince2.asp, Accessed on October 17 2010 Bellis, P., Project Methodologies: An introduction to PRINCE2 Methodlogy, JISC Infonet, 2003 Harrison, F., Lock and Dennis, Advanced Project Management - A Structures Approach, fourth ed., Gower Publishing Limited, 2004. Read More