MODULE 2

PROJECT FUNDMENTALS

Project Fundamentals

What is a PMBOK Guide?

PMBOK Guide (pronounced PIM-BOK) stands for A Guide to Project
Management Body of Knowledge. It is actually a book which presents a set
of standard terminology and guidelines for project management. This book is
published by the Project Management Institute (PMI), U.S.A. The PMP
Certification Exam is based on the PMBOK Guide. (We shall look at this
again in later slides)

What is a Project?

*A project is A temporary endeavor to create a unique product,

service or result.
The outcome of a project viz. product, service or result is
collectively termed as a Deliverable.

Project Fundamentals

Project Characteristics:

Temporary

A project is temporary in nature.

Which means it has a definite
start and an end date. Temporary
could mean a week, a month, a
year or few years or perhaps even
a decade.

Project Fundamentals

Project Characteristics:

Unique

A project creates a unique

deliverable which could be a
product, service or a result that is
tangible or measurable.
It could be a building construction,
software tool or an engineering
drawing.

Project Fundamentals

Project Characteristics:
Progressively Elaborated
As you keep working on the project, you
learn to know more about the project.
The project begins with a conceptual or
high level, then as you gather more and
more information, the requirements are
refined or become specific.

Project Fundamentals

Why projects are undertaken:

Few reasons why projects are undertaken by any organization:
Market Demand or Business Need: An opportunity to cater to the demands of the
market
Organization Need: An internal requirement for the organization to improve its
operations better infrastructure, reduction in costs, improve profits etc.
Customer Need: A customer requirements are catered by creating a new project
Technological Advance: A change in technology makes it a compulsion for the
organization to adapt to changes and stay ahead of the competition
Legal Requirement: Changes in Government Laws & Regulations

Social Need: Societal cause; project for the benefit of public usually by Govt.

Project Fundamentals

Project End Criteria:

A project ends when its objective (s) or goal(s) is/are achieved
The requirement for the project no longer exists and as a result it gets cancelled or
terminated

Examples of Project:
Rail Roads, Buildings, Bridges etc. (construction based projects)
Engineering drawing plan for
(architectural/drawing projects)

new

sports

car

Developing a software application (IT based projects)

Feasibility or viability or pilot study (Research based projects)

model

or

an

automobile

Project Fundamentals

Operations:
Ongoing
Operations are ongoing or repetitive in nature
Requires planning, people and other resources similar to a project with the only difference
that it is continuous. There is no end date
Purpose is to sustain the functioning of a business
Includes the organizational procedures
For example: Day to day activities like Financial or Accounting operations, Human Resource
operations, Logistics & Transport operations

Project Fundamentals

What is Project Management?

*Project Management is The application of knowledge, skills, tools and techniques to project
activities to meet the project requirements.

What are the Project Constraints?

Project constraints are the factors that affect a project outcome. Some of the project
constraints are Scope, Cost/Budget, Time/Schedule, Quality, Risk, Resources.

Project Fundamentals

Project Constraints (continued)

The project constraints are interlinked and any change in one constraint could affect the
remaining constraints.
For example: A cost change could affect the schedule, scope and there by the quality.

Quality

Scope

Project Fundamentals

What is a Project Management Office (PMO)?

A Project Management Office or Project Office could be a
separate department that supports project management by
Providing the policies, methodologies and templates for
managing projects within the organization.
Providing support and guidance to others in the organization
on how to manage projects, training others in project
management or project management software and assisting
with specific project management tools.
Providing project managers for different projects in some
cases.

Project Fundamentals
What is a Phase?
A Project is logically divided into small portions called Phases. Each phase
has a duration and one or more deliverable associated with it. The phases are
project specific.
For example: An IT project could have Requirements, Analysis, Design,
Development and Implementation phases.
Phases can be executed in sequence or simultaneously (overlap one another)
At the end of each phase, a decision is taken whether to continue to the next
phase or terminate the project. Its called Phase Exit or Phase Gate or
Kill Gate or Phase End Review.

Project Fundamentals

What are Regulations and Standards?

Regulation is an official document that provides guidelines and is issued by a Government .
Compliance to regulations are mandatory.
Standards on the other hand provides guidelines or best practices defined by a recognized
body (private). Compliance to standards are not mandatory but may be helpful.

What is a system?
System could be a physical system like computer or formal procedure, process, forms or tools
to manage the tasks.

Project Fundamentals

Who are Project Stakeholders?

PMBOK Guide defines a Project Stakeholders as Person or organizations that are actively
involved in a project or whose interests may be positively or negatively affected as a result of
project execution or project completion .
Key stakeholders in a project includes:
Portfolio Manager
Program Manager
Project Manager
Project Team

Project Management Office (PMO)

Customer or End User who uses the product or service

Project Fundamentals

Project Stakeholders (continued)

Key stakeholders in a project include (continued):

Project Sponsor one who funds the project

Suppliers/Vendors or Business Partners who are in contractual agreement to provide
components or services necessary for the project.
Functional or Line Manager who performs administrative or other functional activities like
human resources, finance, accounting, or procurement
Operational Managers managers who perform other core business operations such as
research & development, design, testing , repair etc.
Negative Stakeholder: A stakeholder who does not want the project to succeed and tries to
negatively influence the project

Project Fundamentals

Types of Organizations
The type of organization that undertakes a project will have an impact on the way the project
is managed and ultimately the success of the project. There are three types of organizations
namely Functional, Matrix and Projectized.
Matrix organizations are further classified as Weak Matrix, Balanced Matrix and Strong Matrix.
Projectized
Strong Matrix
Balanced Matrix
Weak Matrix

Functional

Project Fundamentals

Functional Organization
This type of organization structure consists of various departments or business units based on
a specific function or area of expertise. A functional manager or head of department leads the
projects that are specific to the business unit.
For example: A functional organization may have finance department, accounting
department, manufacturing department, marketing & sales department, R & D department
etc.
Employees belonging to these department have their own area of expertise and they report
to their respective functional manager as well as the project manager. Functional manager
controls the resources and budget.

The project manager has no power or authority, project role is almost negligible , limited to
project status reporting and is also part-time.
The project manager is also called a Project Expeditor.

Project Fundamentals

Weak Matrix Organization

A weak matrix closely resembles a functional organization. The project team members may
come from different departments and report to the project manager and also their functional
manager. The project manager reports to a specific functional manager directly. Functional
manager controls the resources and budget.

The project manager in a weak matrix has the following attributes:

Very limited authority or power.
Role is part-time
May have some part-time administrative support staff to expedite the project
Is also known as Project Coordinator, or Project Administrator or Team Lead

Project Fundamentals

Balanced Matrix Organization

In a balanced matrix the power and authority is shared equally between the project manager
and the functional manager. The employees report to both project manager and their
respective functional manager. The functional manager controls the resources. The budget
control is shared between project manager and functional manager.

The project manager in a balanced matrix has the following attributes:

Reasonable authority or power.
Role is full-time
May have some part-time administrative support staff to expedite the project

Project Fundamentals

Strong Matrix Organization

In a strong matrix the project manager has more power and authority than the functional
manager. The employees report to both project manager and their respective functional
manager. The project manager controls the resources in the project team.
The project manager in a strong matrix has the following attributes:
Reasonable to high level authority or power.
Role is full-time
Controls the budget.

May have full-time administrative support staff to expedite the project

Project Fundamentals
Projectized Organization
A projectized organization is organized around projects and each project is lead by a project
manager who is solely responsible for the project. The employees report to their project
manager only. Once the project is completed the resources are released for use in other
projects.

The project manager in a projectized organization has the following attributes:

High to complete level authority or power.
Role is full-time
Has full-time administrative support staff to expedite the project
Controls the budget as well as the resources

Role of a Project Manager

Functional Manager-focused on providing
management oversight for an administrative area

Operations Manager- responsible for a facet of a

core business
Project Manager should possess

1.Understanding and applying the knowledge, tools

and techniques that are recognized as good
practice
2. Area specific skills
3. General management proficiencies

Project Management Framework

Fundamentals

Project Management Framework Fundamentals

Another look at PMBOK Guide

There are 5 process groups, 10 knowledge areas and 47 management processes as per
PMBOK Guide (5th edition).

What is a Process Group?

The process group is a logical division of the project management processes based on the kind
of action taken in the project. These process groups could be repeated within each phase in
the project. There are 5 process groups as per PMBOK Guide (5th edition) and they are:
1.

Initiating

2.

Planning

3.

Executing

4.

Monitoring & Controlling

5.

Closing

PMI Process Groups

Each Process Groups has its own

lifecycle

Differences - PMI Process Groups

Presented as discrete elements with well defined

interfaces
In practice, they are overlap and interact in ways that
are not detailed in some ways
Guides for applying appropriate project management
knowledge and skills during the project
The application is iterative, and many process are
repeated during the project. It is seldom one-time event
Linked by the OUTPUT they produce.
Output usually becomes INPUT to another process or is
a DELIVERABLES of the project

Differences Process Groups &

Project Phases Lifecycle

Each Process Groups has its own lifecycle

Differences Project Phases

Project Phases are divisions within a project where extra control is

needed to effectively manage the completion of a major deliverable.
Project phases are typically completed sequentially, but can overlap in
some project situations. The high level nature of project phases makes
them an element of project lifecycle.
A project Phase is NOT a Project Management Process Group

Allows the project to be segmented into logical subsets for

ease of management, planning & control.
When the phase ends work is handover to other department
requires Gate Reviews
Focus on different skill sets
The Primary deliverable of the phase requires an extra degree
of control to be successfully achieved.

PMI Five Process Groups

Nine Knowledge Areas

PMI Five Process Groups

Nine Knowledge Areas

Project Management Framework Fundamentals

What are Knowledge Areas?
The knowledge areas are logical division of the project management processes based on the
domain or functional areas. Each knowledge area has got at-least one management process.
There are 10 knowledge areas as per PMBOK Guide (5th edition) and they are:
1.

Project Integration Management

2.

Project Scope Management

3.

Project Time Management

4.

Project Cost Management

5.

Project Quality Management

6.

Project Human Resource Management

7.

Project Communications Management

8.

Project Risk Management

9.

Project Procurement Management

10. Project Stakeholder Management

Project Management Framework Fundamentals

What is a Project Management Process?

A process can be thought as a package of inputs, tools & techniques and outputs. Each
process can only belong one knowledge area and one process group. There are 47
management processes as per PMBOK Guide (5th edition).
Tools
&
Techniques

Inputs

Output

The output(s) of one process may be input(s) for another process. Every process may be
performed more than once in a single project or in a single phase.

Input(s)
Tools &
Techniques
Output(s)

Process1

Process2
Input(s)
Tools &
Techniques
Output(s)

Input(s)
Tools &
Techniques
Output(s)

Process3

Project Management Framework Fundamentals

Common Terms & Terminologies

*Enterprise Environmental Factors (EEFs)
Enterprise Environmental Factors refers to conditions not under the immediate control of the
team, that influence, constrain, or direct the project, program or portfolio.
Some of the EEFs are :
Organizational culture, structure, and governance
Geographic distribution of facilities and resources
Infrastructure
Company Work Authorization Systems and Project Management Information Systems

Market Conditions
Existing Human Resources and Personnel Administration
Political Climate, Commercial Database

Project Management Framework Fundamentals

Organizational Process Assets (OPA)

Organizational Process Assets includes the information, tools, templates and documents,
procedures, guidelines, historical project documents, enterprise database etc. that could be of
help in planning a project.
Some of the OPAs are :
Templates of common project documents

Previous project plans

Organizational policies, procedures and guidelines
Software tools

Enterprise database & Knowledge base

Lessons learned documents and so on

Project Management Framework Fundamentals

Expert Judgment
Experts who are internal to the organization or external to an organization such as
independent consultants, consulting agencies & firms, subject matter experts (SME)
etc. who can provide their expertise or advice , help in resolving project related
matters.

Project Management Framework Fundamentals

*Work Performance Data

Work Performance Data is The raw observations and measurements identified during
activities being performed to carry out the project work.
*Work Performance Information
Work Performance Information is The performance data collected from various controlling
processes, analyzed in context and integrated based on relationships across areas.

*Work Performance Reports

Work Performance Reports are Work Performance Information compiled into a format of
presentation or report. E.g. Formal Recommendations, Decisions or Conclusions about a
project.

Industry Standards
Phase 1

Phase 2

CONCEPT

Phase 4

Phase 5

MATERIALS
PRODUCTIO
N

MANUFACTU
RING &
ASSEMBLY

Phase 6

Phase 3

DESIGN

PROTOTYPE

Phase 7

WIRING &
WELDING

TESTING

Auto Industry Project

Lifecycle
Phase 1

Phase 2

Phase 3

Phase 3

Phase 4

Phase 5

CONCEPT

DISCOVERY

INITIATION

PLANNING

DESIGN

TESTING

Phase 6
IMPLEMENTAT
ION

Phase 7
POST
IMPLEMENTAT
ION

Banking Industry SDLC Project

Lifecycle
Phase 1
REQUIREMENTS
SPECIFICATION

Phase 2
SOFTWARE
DESIGN

Phase 3
IMPLEMENTATIO
N&
INTEGRATION

Phase 3

Phase 4

TESTING
(VALIDATION)

DEPLOYMENT
(INSTALLATION)

Phase 5
MAINTENANCE

IT Industry Software Development

Lifecycle
Phase 0

Phase 1

Phase 2

ORIGINATION

INITIATION

PLANNING

Phase 3

Phase 4

Phase 5

Phase 6

CONSULTANT
SELECTION

ANALYSIS &
DESIGN

TENDER &
AWARD

IMPLEMENT
ATION

Construction
Project Lifecycle

Phase 7
CLOSEOUT

SO
HOW DO YOU START A
PROJECT THEN?

What is the Right Process?

Consider for discussions (15 minutes)

Starting a Project

Identification of
problem/opportunity
recognition of business need
High Level Business Case
Evaluation by Client Rationale
for the Project
What are the business drivers?
Like to do /must do?
How does it fit in with business
goals vision and mission etc
What are the financial and non
financial costs?
Most do not survive this
evaluation

Then.

Examination of the proposal solution in

more detail and specifying
requirements of client face to face,
interview, meetings, etc.
Identifying the project scope and
objectives and deliverables,
specifying the work as well as
identifying assumptions and constraints
Preparation of specification which
guides the work and team
Project Initiation Document or
Business Case

Starting a Project Business Case

The Project Business Case is a one-off, start-up

document used by senior management to assess
the justification of a proposed project

Basis for comparison of a number of projects

competing for limited funds/ assess the options for
a project that has already received funding

Confirms senior management support and/or

resourcing for a recommended course of action

Objective

Objectives are concrete statements describing what

the project is trying to achieve. Objectives should be
written at a low level so that they can be evaluated at
the conclusion of a project to determine if they were
achieved. A well-worded objective will be SMART

SMART Objectives

Do the Objectives describe concrete achievements and

outcomes that support the stated project goal? Statements:Specific - Does your Objective reference a discrete
achievement?

Measurable - Does your Objective have a measurable outcome

with an identified metric?
Attainable - Is it actually possible to obtain your specified
Objective?
Realistic - Is the proposed Objective reasonably obtainable
within the constraints of available resources?
Time-bound - Is there a definitive date by which the Objective
will be reached?

Scoping the Project

Defining the parameters not about deciding cost and time

Buying a car scope first 4 cylinder front wheel drive
with seating for 2 adults + 2 and less than 2 years old.
Black convertible? Having defined the scope cost and
time can be calculated
Remove uncertainties - formal contract or agreement with
principal stakeholder (External = client and Internal =
sponsor)
Objectives and deliverables have to be considered when
scoping project to be successful the project must deliver
the product the project was formed to create (to spec) but
must also meet the project objectives

Scope Statement

Forms the basis for

agreement between the
customer and the supplier
Basis for all project
related decisions
Identifies the objectives and
the deliverables and forms
a basis for common
understanding
Section within the project
plan and should be
agreed
Exclusions as well as
inclusions

Products, services, processes or plans that

are created as a result of the project any
tangible outcome that is produced by the project
e.g. documents, plans, computer systems,
buildings, aircraft

Internal = produced as result of executing the

project mostly for project team (Project Plan,
Specification)

External = customers and stakeholders

Always measurable

Project Specifications

Prescribes the requirements with which the product or

service has to conform

What the client asks for

What the client

wants

Project Deliverables

Establish the project environment and provide a basis for

planning and estimating the project
By defining assumptions the project team can establish
their validity and develop contingency plans if the
assumptions prove to be true
Think about project environment, quality, time, cost
and risk, scope, resources and technology

Critical Success Factor (CSF)

You can't manage what

you can't measure."

Key factors seen to be crucial to

projects success
Should be determined at the
beginning of the project
Listed in priority and reflect the
project objectives

Issues with Critical Success Factors

Project success is a topic that is frequently

discussed and yet rarely agreed upon. The
concept of project success has remained
ambiguous defined. It is a concept which can
mean so much to so many different people
because of varying perceptions and leads to
disagreements about whether a project is
successful or not. (PMI)

Managing Projects is Tough!

Requirements are incomplete
Its very difficult for a person to take into account all of
the alternative flows and how different sets of
requirements relate to each other
Believe that you have, or ever can have a
comprehensive and finalized set of requirements is a
self-deception

Changes are inevitable

Project priorities will shift
Resources will be pulled off the projects
Risks will materialize
Estimates will turn out to be unrealistic

Module 3