The Little Black Book of Project Management Third Edition

By Michael C. Thomsett

AMACOM

Copyright © 2010 Michael C. Thomsett
All right reserved.
ISBN: 978-0-8144-1529-0

Contents

Introduction to the Third Edition……………………………..ix1 Organizing for the Long Term………………………………..12 The Six Sigma Approach……………………………………..213 Creating the Plan………………………………………….364 Choosing the Project Team…………………………………..565 Preparing the Project Budget………………………………..756 Establishing a Schedule…………………………………….947 Flowcharting for Project Control…………………………….1098 Designing the Project Flowchart……………………………..1279 Managing the Value Chain in the Project………………………14610 Writing the Supporting Documentation………………………..16011 Conducting the Project Review………………………………17712 The Communication Challenge………………………………..19513 Project Management and Your Career………………………….21614 Finding the Best Project Management Software…………………229Appendix: Work Project Answers………………………………..233Glossary……………………………………………………253Index………………………………………………………257

Chapter One

Organizing for the Long Term

Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity.

—GEORGE S. PATTON—

The new clerk in the mailroom noticed an elderly gentleman sitting in a corner, slowly sorting through a mountain of mail.

“Who’s that?” he asked the supervisor.

“That’s old Charlie. He’s been with the company more than forty years.”

The new clerk asked, “Are you saying he never made it out of the mailroom?”

“He did, but then he asked to be transferred here—after spending a few years as a project manager.”

Dread. That is a common reaction most managers have to being given a project assignment. Few managers will seek out the project, and most will avoid it if possible. Why?

First, a distinction has to be made between projects and routines. The routines associated with operation of your department are repetitive in nature. Put another way, they are predictable. That means that the recurring operations you execute can be planned as a matter of course. Once you have gone through your normal cycle a few times, you know what to expect. Because they are predictable, recurring operational routines that are easier to manage than projects.

The project itself is temporary and nonrecurring in nature. It has a beginning and an end rather than a repetitive cycle. Thus, projects are by nature chaotic. Making projects even more daunting is that few companies have specialized project teams or departments. The project is assigned to a manager who seems to be a logical choice for the job. If the project is related to marketing, it will probably be assigned within the marketing area of the company. If financial in nature, the accounting or internal auditing department will be likely candidates.

Project scope and duration are impossible to define because projects arise at every level within the organization. This characteristic presents special problems for every manager because merely receiving a project assignment does not necessarily mean that you know what will be involved in the task. This makes scheduling and budgeting difficult, to say the least. A project has to be planned out, defined, and organized before you can know what you are up against in terms of actual management. Thus, you may be given an assignment, budget, and deadline before the project itself has been defined well enough to proceed. It will then be necessary to revise not only the schedule and budget, but perhaps the very definition of the project itself.

The secret to the skilled execution of a project is not found in the development of new skills, but in applying existing skills in a new environment. Projects are exceptional, out of the ordinary, and by definition, temporary in nature. So the problems, restrictions, deadlines, and budget are all outside the normal course of your operations. Some professions deal in projects continuously; for example, engineers, contractors, and architects operate in a project environment for every job they undertake. However, they have the experience to manage any problem that arises because it is part of their “skills package” to operate in ever-changing circumstances where similar problems arise.

You manage a series of problems in your department as an operational fact of life. Your department may be defined in terms of the kinds of problems you face each month and overcome. The controls you apply, budgets you meet, and reports you generate as a result of confronting problems within your operational cycle are the outcomes you know and expect. Assignments are made in the same or similar time sequence from month to month, and routines are performed in the same order, usually by the same employees. Even many of the problems that arise are predictable. However, when you are faced with the temporary and exceptional project, it raises several questions, all of which are related to questions of organization, planning, and control. These include:

How do I get started?

Exactly what is the project meant to achieve or discover?

Who is responsible for what, and how is the effort to be coordinated?

Beyond these are the equally important questions related to budgets, schedules, and assignments to a project team. The project presents a set of new demands that, although temporary in nature, require commitment from limited resources. Your department will be expected to continue meeting its recurring work schedule. Thus, a project places an additional burden on you and the others in your department. If the project also involves working with people in other departments, it will create even more potential problems. The point at which responsibility and work processes occur between departments often is also the point at which the smooth processing of the project routine is likely to be disrupted.

Background for Project Management

The difficulties you face as a project manager can be made to conform with a logical system for planning and execution, even when you need to continue managing your department at the same time. Much thought has gone into the science of project management on many levels. If you work regularly in a project environment, you can find assistance and support from several sources, including the Project Management Institute (PMI).

This book adheres to the standards expressed by the Project Management Institute and attempts to present readers with a concise overview of the principles they’ll need to employ as project manager. To begin, it is important to define some of the basic principles and ideas underlying the work of project management.

Project Definitions

The project is best defined in two ways:

1. By comparing a project to a routine

2. By knowing the operational constraints associated with projects

A “project” has different meanings in each organization and may also vary from one department to another. For the purposes of proceeding with the preliminary steps in organizing your project, this book adheres to the two-part definition mentioned above: by comparison to routines and by the constraints under which projects are run.

The comparison between projects and routines can be divided into four parts as summarized in Figure 1-1 and outlined here:

1. A project is an exception. Unlike routines, projects involve investigation, compilation, arrangement, and reporting of findings in some way that provides value. The answers to the basic project questions cannot be found in the routines of your department, which is what makes it exceptional. The processes involved with the project fall outside your department’s “normal” range of activities and functions.

2. Project activities are related, regardless of departmental routines. Projects are rarely so restricted in nature that they involve only one department. The characteristics of a department involve related routines, but projects are not so restricted. Thus, a project is likely to involve activities that extend beyond your immediate department, which also means that your project team may include employees from other departments.

3. Project goals and deadlines are specific. Recurring tasks invariably are developed with departmental goals in mind. Financial departments crunch numbers, marketing departments promote sales and develop new markets, and filing departments organize paperwork. The goals and related tasks tend to move forward primarily in terms of time deadlines. The same is true for departmental deadlines; they are recurring and dependable, tied to specific cyclical dates or events in other departments. Projects, though, have an isolated and finite number of goals that do not recur, plus identifiable starting and stopping points. Whereas departmental routines are general in nature, project activities are clearly specific.

4. The desired result is identified. A project is well defined only when a specific result is known. By comparison, departmental routines involve functions that may be called “process maintenance.” That means that rather than producing a specific outcome, a series of recurring routines are aimed at ensuring the flow of outcomes (e.g., reports) from one period to another. The department gets information from others, processes it, and passes it on in a refined form, and this series of steps takes place continuously. While a project involves the same basic idea—receiving information, analyzing it, and reporting conclusions—there are two clear distinctions worth keeping in mind. First, the work is nonrecurring, so the demands of a project cannot be easily identified in every case. Second, the desired result is identified in isolation from other functions of the department.

Projects are also distinguished from routines by how they operate under the constraints of result, budget, and time (see Figure 1-2).

To a degree, all management functions operate within these constraints. For example, your department probably is expected to perform and produce one or more results, or outcomes; you operate within a specific budget; and by the nature of your work, you prioritize on the basis of deadlines. Without these constraints, a company would lack definition and order. We may also judge a company or department by how well it adheres to the expectations for results, budget, and time.

The same is true for projects. The constraints under which you operate also provide a means for testing and judging quality of work. The constraints, whether applied to your department or to a one-time project, are perpetual. However, emphasis on the three constraints is not always applied at the same level; some variation of emphasis should be expected, depending on the nature of the project or the work of a department.

The priority given to one constraint or another is demonstrated as part of a departmental routine. The constraints are constant and part of the nature of the work being performed in each case. However, a project, unlike a department, will succeed or fail purely on the basis of the three constraints as follows:

1. Result. Completion of a specific, defined task or a series of tasks is the primary driving force behind the project. Unlike the recurring tasks that are faced on the departmental level, the project is targeted to the idea of a finite, one-time result.

2. Budget. A project’s budget is separate from the department’s budget. The project team operates with a degree of independence in terms of control and money (even though each team member may be expected to continue completion of departmental tasks). Project teams may include individuals from several different departments; thus, budgetary controls cannot always be organized along departmental lines. A project may require a capital budget as well as an expense budget. As project manager, you may also have more than the usual amount of control over variances.

3. Time. Projects have specific starting and ending points. A well-planned project is based on careful controls over completion phases, which involves careful use of each team member’s time.

Definition and Control

In organizing your project within the aforementioned limitations, you must also master two components that characterize every project. To complete the project successfully, you need to define, and to control, each aspect of the project itself. Without definition and control, you will be less likely to achieve (or know) the desired final result, within budget, and by the deadline.

As illustrated in Figure 1-3, the definition component of the project is the proper starting point that leads through to the control phase.

Elements That Define a Project

* Purpose. What is the expectation? Why is the project being undertaken? What conclusions or answers to problems is it expected to produce?

* Tasks. How can a large project be broken down into a series of short-term progress steps? A large project can be overwhelming, whereas smaller steps can be attacked methodically and completed according to a schedule.

* Schedule. What is the final deadline? With that deadline in mind, how should a series of smaller tasks be arranged, maintained, and timed? Effective task scheduling is the key to meeting longer-term deadlines.

* Budget. How much should the project cost? Will the company need to invest in research, capital equipment, promotion, or market testing? What expenses will be involved, and how much money needs to be set aside for final completion? Will you be expected to complete all or part of the project within your existing departmental budget, and is that expectation realistic?

Elements That Control a Project

* Team. You will not always be able to organize your team from your own department alone. However, before building a team, you need to develop project definitions so that you know the scope of the project.

* Coordination. By its nature, the project demands consistent and firm management. Committees do not work well if they are overly democratic, so as project manager you need to have complete responsibility for pulling together the efforts of everyone on the project team.

* Monitoring. Your schedule and budget will succeed only if you are able to spot emerging problems and correct them. Delegating work to others and creating a control system are essential, but they are only starting points. You also need to track the indicators that reveal whether your project is on schedule and within budget. So much of the job of project manager involves piloting the project that it may be your primary action; an especially complex project requires that monitoring be a constant.

* Action. If you discover that scheduling or budgetary problems are developing, action should be taken immediately to reverse those trends. If the team is falling behind schedule, the pace of work has to be accelerated. (Or, if it turns out that the original schedule was unrealistic, it should be revised right away.) If your expenses are exceeding budget, additional controls should be put into place to avoid further variances. These steps are possible only when you take action as soon as problems are discovered.

* Completion. Even when the project is effectively managed and kept on schedule for 99 percent of the time, if the final step is not taken the deadline will not be met. Even well-run projects sometimes prove difficult to close out. The final report or recommendation, the commitment to paper, often proves to be the hardest part of the entire project.

A New Look for Project Management

Project management is a dynamic process, and new ideas are continually entering into the methods of practice. Today’s organization looks much different from the organization a decade ago, due to many factors: the Internet, information technology (IT), changing cultural beliefs, enlightened social ideas, and even experimental management techniques.

Among the trends affecting how your project will operate are four key areas:

1. Six Sigma. The management ideal has changed dramatically since widespread acceptance and use of Six Sigma. This important quality approach is not only a systematic way to tackle quality issues, but also a revised organizational culture. The inclusionary aspects of Six Sigma have vastly changed how many organizations work, including most of the Fortune 500 companies, federal and state governments, branches of the military, and not-for-profit companies. Six Sigma cannot be isolated from project management because it offers a framework for ensuring value and permanence in the output resulting from the project. Chapter 2 explains Six Sigma from a project management perspective.

2. Risk management. The concept of risk management has in the past been isolated to a rather one-dimensional view of risk itself. Risk used to be defined as something to be mitigated through insurance, passed on to vendors or other operating segments, or simply ignored as something unlikely to occur. Today, with an increased awareness of the expanded realm of threats, this has changed. Today, identity theft, automated system hacking, terrorism, internal sabotage, corporate espionage, pandemics, and natural disasters are but a few of the types of risks that—while always having been there—are now being more widely accepted as real and serious problems in every organization. The increased reliance on vendors overseas (often very few in number but originating in one country) augment the risks that organizations face from political unrest, strikes, transportation slowdown or disasters, and product quality control at the source.

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Excerpted from The Little Black Book of Project Management Third Editionby Michael C. Thomsett Copyright © 2010 by Michael C. Thomsett. Excerpted by permission of AMACOM. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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