Project Management – Midterm Review

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How was project management developed?
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Credit for the developement goes to the military
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Examples of military projects
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• navy’s Polaris program • NASA’s Apollo space program • development of smart bombs and missiles
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Some examples of large projects
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• the channel tunnel (Chunnel) • Denver international airport • Panama Canal expansion project • three gorges dam, china
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Projects getting larger over time (example)
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Flying: balloons -> planes -> jets -> rockets -> reusable rockets
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Three project objectives: what is the “triple constraint”?
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Time, scope and cost
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Project success leads to..
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• project efficiency • impact on customer • business impact on the organization • opening new opportunities for the future
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Who is the key individual on a project?
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The project manager
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Who is the major project management organization?
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The project management institute founded in 1969
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How many members?
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Grew from 7,500 in 1990 to over 320,000 in 2010
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Other organizations
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• association for project management • international project management association
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What is the definition of a project?
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A temporary endeavor undertaken to create a unique product, service or result
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What project did modern project management begin with?
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The Manhattan Project
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What are the major characteristics of a project?
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• importance • scope • life cycle with a finite due date • interdependencies • uniqueness • resources • conflict
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What is the main purpose for initiating a project?
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To accomplish some goal
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Part 1: project initiation
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• projects in contemporary organizations • strategic management and project selection • the project manager • managing conflict and the art of negotiation • the project in the organizational structure
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Part 2: project planning
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• project activity and risk planning • budgeting: estimating costs and risks • scheduling • resource allocation
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Part 3: project execution
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• monitoring and information systems • project control • project auditing • project termination
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Types of companies
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1) companies whose core business is completing projects 2) companies whose core business is something else
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How else can they be broken down?
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• companies looking at projects to do for others • companies looking at projects to do for themselves
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What percentage of projects are cancelled midstream?
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30%
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Over half of completed projects came in up to _______% over budget.
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190
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Over half of completed projects came in up to ________% late.
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220
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Challenges
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• making sure projects are closely tied to goals and strategy • how to handle the growing number of projects • how to make these projects successful
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Project selection
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• evaluating • choosing • implementing
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Problems with multiple projects
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• delays in one project delays others • inefficient use of resources • bottlenecks in resource availability
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Types of project selection models
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• non-numeric • numeric
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Non-numeric
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• models that do not return a numeric value for a project to be compared with other projects • not really models but rather justifications • just because they’re not all models doesn’t mean they’re all bad
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Types of non-numeric models
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• sacred cow • operating necessity • competitive necessity • product line extension • comparative benefit
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Sacred cow
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A project, often suggested by the top management, that has taken on a life of its own
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Operating necessity
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A project that is required in order to protect lives or property or to keep the company operation
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Competitive necessity
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A project that is required in order to maintain the company’s position in the marketplace
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Product line extension
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Often, projects to expand a product line are evaluated on how well the new product meshes with the existing product line rather than on overall benefits
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Comparative benefit
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Projects are subjectively rank ordered based on their perceived benefit to the company
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Numeric models
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Models that return a numeric value for a project that can easily be compared with other projects
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Types of numeric models
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• profit/profitability • scoring
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Payback period
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The length of time until the original investment has been recouped by the project (the shorter the better)
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Payback period example
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Payback period = project cost over annual cash flow
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Payback period drawbacks
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• does not consider time value of money • more difficult to use when cash flows change over time • less meaningful for longer periods of time (due to time value of money)
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Scoring models
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• unweighted 0-1 factor model • unweighted factor model • weighted factor model
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Unweighted 0-1 factor model
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• factors selected (listed on a preprinted form) • raters score the project on each factor • each project gets a total score • main advantage is that the model uses multiple criteria • major disadvantages are that it assumes all criteria are of equal importance
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Weighted factor model
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• each factor is weighted relative to its importance (weighting allows important factors to stand out) • a good way to include non-numeric data in the analysis • factors need to sum to one • all weights must be set up, so higher values mean more desirable • small differences in totals are not meaningful
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The project portfolio process (PPP)
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• links projects directly to the goals and strategy of the organization • means for monitoring and controlling projects
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Project portfolio process steps
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1) establish a project council 2) identify project categories and criteria 3) collect project data 4) assess resource availability 5) reduce the project and criteria set 6) prioritize the projects within categories 7) select the projects to be funded and held in reserve 8) implement process
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What is a project proposal?
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Essentially it’s a project bid
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What does a project proposal require?
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A detailed analysis of the project
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How long do they take to complete?
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Weeks to months
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Who briefs the project manager?
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Senior management
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What does the project manager begin with?
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A budget and schedule
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What is functional management?
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Department heads are usually functional specialists; they have the required technical skills to evaluate all members of their organization
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Functional members
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• decide WHO performs each task • decide HOW the task is performed • exercise a great deal of control over every aspect of the work that gets performed within the area
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Project managers
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• rarely decide who performs each task • lack the technical skills to evaluate much of the work performed on a particular project • exercise control very little over most aspects of the work that gets performed on the project
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What are the 3 major questions facing PM’s?
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1) what needs to be done? 2) when must it be done? 3) how are the resources required to do the job to be obtained?
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Project manager responsibilities
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• the parent company • the project and the client • the project team
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The parent company
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• proper usage of resources • timely and accurate reports • keep project sponsor informed
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The project and the client
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• preserve the integrity of the project (may be difficult with all sides wanting changes) • keep the client informed of major changes
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Special demands on PM
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• acquiring adequate resources • acquiring and motivating personnel • dealing with obstacles • making project goal trade offs • maintaining a balanced outlook • breadth of communication • negotiation
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Acquiring adequate resources
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• project budgets are usually inadequate • resource trade offs must be considered • crises occur that require special resources • availability of resources is seen as a win-lose proposition
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Acquiring and motivating personnel
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• most project workers are borrowed from functional managers • the PM negotiates for the desired worker
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The functional manager also decides
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• the skill level to assign • the pay and promotion of the worker (PM has little to no control over pay/promotion)
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Most important characteristics for team members
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• high quality technical skills • political and general sensitivity • strong problem orientation • strong goal orientation • high self esteem
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What’s a major problem with projects?
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Scope creep
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Early problems are associated with..
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Resources
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Later problems are associated with..
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• last minute schedule and technical changes • the happenings to a team when the project is competed
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PM’s must make trade offs between the project goals of:
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Cost, time, scope, ancillary goals
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Negotiations
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• acquiring adequate resources • motivating personnel • dealing with obstacles • making project goal trade offs • handling failure • maintaining communication
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Attributes of effective PM’s
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• credibility • sensitivity • leadership, ethics, management • ability to handle stress
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Types of sensitivity
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• political • interpersonal • technical
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Cultural differences
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PM’s must adapt to the social and cultural environment in which they are working
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Culture and the project
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• time • staffing projects • knowledge of people
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Conflict
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The process which begins when one party perceives that the other has frustrated some concern of his
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Project life cycle
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• formulation • buildup • main program • phase out • conceptualization • planning • execution • termination
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Categories of conflict
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• different goals and expectations • uncertainty about authority • interpersonal conflict
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Project formation
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• conflict can’t be avoided at this phase • “good conflict”
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Handling project formation conflict
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• technical objective set • senior management and line managers commit to project • priority set • organizational structure established
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Main program
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• schedules are main source of conflict • tasks will be late – schedules should be adjusted • more complex the harder to trace source of conflict • technical difficulties
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Project phase out
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• deadlines- major source of conflict • technical problems are rare • personality conflicts will be a big deal due to time pressures
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Nature of negotiation
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• the process through which two or more parties seek an acceptable rate of exchange for items they own or control • parties to a negotiation often see themselves as opponents • “if they win, I lose” • PM must avoid this on projects as all stakeholders are interrelated
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Partnering, chartering, and change
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• use of subcontractors • use of input from two or more functional units • management of change
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Project charter
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A written agreement that outlines the specifics of the project
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Scope change
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• initial assessment was wrong • project team learns more about the project • change is mandated • client asks for changes
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Requirements and principles of negotiation
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Have to do with the design • how, whom, when, what cost
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Principled negotiation
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1) separate the people from the problem 2) focus on interests, not positions 3) before trying to reach agreement, invent options for mutual gain 4) insists on using objective criteria
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Traditional forms of organization
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1) functional 2) projectized 3) matrix 4) composite
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Virtual projects
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• project team crosses time, space, organizational, or cultural boundaries • facilitated by the use of the internet • often organized as a matrix
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All projects are composed of what?
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Interconnected groups
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Need to avoid what mentality?
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“Us versus them”
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Human factors
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• internal conflict • member frustration • wasting time • poor decision making • team members more concerned with finishing the job than doing a good job
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Initial project coordination and project charter
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Used to “flesh out” nature of the project -outcomes include: • technical scope • areas of responsibility • delivery dates or budgets • risk management group
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Project charter elements
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• purpose • objectives • overview • schedules • resources • personnel • risk management plans • evaluation methods
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Starting the project plan: The WBS
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• what is to be done • when it is to be started and finished • who is going to do it
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The work breakdown structure (WBS)
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A hierarchical planning process • breaks tasks down into successively finer levels of detail (makes tracking the work easier)
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Steps to create a WBS
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1) list the task breakdown in successive levels 2) ID data for each work package 3) review work package info 4) cost the work packages 5) schedule the work packages 6) continue to examine actual resource use 7) continue exam schedule
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The responsibility matrix (RACI)
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• another approach is the Responsible, Accountable, Consult, Inform (RACI) matrix • shows critical interfaces • keeps track of who must approve what and who must be notified
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Project life cycle is used for what?
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Breaking a project up into component phases
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Parts to risk management
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• risk management planning • risk ID • qualitative risk analysis • quantitative risk analysis • risk response planning • risk monitoring and control • the risk management register
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First focus is on what?
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Externalities • track and estimate project survival
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Risk management planning often handled by who?
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Project office
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Risk is dependent on what?
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Technology and environmental factors
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Which method is useful for identifying project risks
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Delphi method
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Other methods include what?
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• brainstorming • nominal group techniques • checklists • attribute listing
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May also use what?
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• cause-effect diagrams • flow charts • influence charts • SWOT analysis
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Qualitative risk analysis
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• purpose: to prioritize risks • sense of impact also needed • each objective should be scaled and weighted • construct a risk matrix • same approach can be used for opportunities
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Quantitive risk analysis
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1) list ways a project can fail 2) evaluate severity 3) estimate likelihood 4) estimate inability to detect 5) find the risk priority number (RPN) {RPN = S x L x D} 6) consider ways to reduce the S, L, and D for each cause of failure
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Risk response planning: threats
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• avoid • transfer • mitigate • accept
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Risk response planning: opportunities
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• exploit • share • enhance • accept

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