Contemporary Project Management FOURTH EDITION Timothy J. Kloppenborg • Vittal Anantatmula • Kathryn N. Wells Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203 MS Project 2016 Instructions in Contemporary Project Management 4e Chapter MS Project 3 MS Project 2016 Introduction Ribbon, Quick Access Toolbar, view panes, Zoom Slider, Shortcuts, Scheduling Mode Selector Setting Up Your First Project Auto schedule, start date, identifying information, summary row Create Milestone Schedule Key milestones, zero duration, must finish on, information 7 Set Up a Work Breakdown Structure (WBS) Understand the WBS definitions and displays Enter WBS Elements (tasks), Create the outline, Insert WBS Code Identifier column, Hide or show subtasks detail 8 Using MS Project for Critical Path Schedules Set Up the Project Schedule Set or update the project start date, Define organization’s working and nonworking time Build the Network Diagram and Identify the Critical Path Enter tasks and milestones, edit the timescale, understand and define task dependencies, assign task duration estimates, identify the critical path, understand the network diagram view Display and Print Schedules 9 Define Resources Resource views, max units, resource calendars Assigning Resources Basic assignment, modify an assignment Identify Overallocated Resources Resource usage and Detailed Gantt views together Overallocated Resources Finding overallocated resources, dealing with overallocations Crashing a Critical Path Activity 10 Develop Bottom-up Project Budget Assignment costs, task costs, various cost perspectives Develop Summary Project Budget 12 Baseline the Project Plan First time baseline, subsequent baselines, viewing variances 14 Using MS Project to Monitor and Control Projects What Makes a Schedule Useful? How MS Project recalculates based on reported actuals, current and future impacts of variances, define the performance update process (who, what, when) Steps to Update the Project Schedule Acquire performance data, set and display status date, Enter duration-based performance data, reschedule remaining work, revise future estimates 15 Close Project Creating project progress reports, sharing reports, export a report to MS Excel, archive project work, capture and publish lessons learned Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. PMBOK® Guide 6e Coverage in Contemporary Project Management 4e The numbers refer to the text page where the process is defined. Project management (PM) processes and knowledge areas 10–11 Project life cycle 7–10, 62–64 Projects and strategic planning 33–37 Organizational influences 102–110 Portfolio and program management 37–42 ® PMBOK Guide, 6th ed. Coverage Knowledge Areas Project Integration Management Initiating Process Group Develop Project Charter 60–79 Planning Process Group Develop Project Management Plan 409–410 Executing Process Group Monitoring & Controlling Process Group Closing Process Group Direct and Manage Project Work 459–460 Manage Project Knowledge 192–193, 504–508 Monitor and Control Project Work 460–462 Perform Integrated Change Control 229–232, 462–463 Close Project or Phase 503, 508–511 Project Scope Management Plan Scope Management 211–212 Collect Requirements 212–216 Define Scope 216–220 Create WBS 220–229 Validate Scope 500–501 Control Scope 475–476 Project Schedule Management Plan Schedule Management 246 Define Activities 249–253 Sequence Activities 253–255 Estimate Activity Durations 255–258 Develop Schedule 259–267 Control Schedule 476–480 Project Cost Management Plan Cost Management 329–330 Estimate Costs 330–341 Determine Budget 342–344 Control Costs 345, 476–480 Project Quality Management Plan Quality Management 401–404 Manage Quality 404–406, 469–474 Control Quality 406–409, 469–474 Project Resources Management Plan Resource Management 290–295 Estimate Activity Resources 290 Aquire Resources 138–141 Develop Team 141–157 Manage Team 157–161 Control Resources 476 Project Communications Management Plan Communications Management 188–192 Manage Communications 193–199, 465–467 Monitor Communications 467–468 Project Risk Management Plan Risk Management 360–366 Identify Risks 75, 366–368 Perform Qualitative Risk Analysis 75, 368–372 Perform Quantitative Risk Analysis 372–373 Plan Risk Responses 75, 373–377 Implement Risk Responses 464–465 Monitor Risks 463–464 Project Procurement Management Plan Procurement Management 431–433, 438–441 Conduct Procurements 434–438 Control Procurments 441 Plan Stakeholder Engagement 184–186 Manage Stakeholder Engagement 187–188 Monitor Stakeholder Engagement 188 Project Stakeholder Management Identify Stakeholders 75–77, 178–184 ® Guide), 6th ed. (Newtown Square, PA: Project Management Source: Adapted from A Guide to the Project Management Body of Knowledge (PMBOK Institute, Inc., 2017): 31. Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Contemporary Project Management ORGANIZE LEAD PLAN PERFORM FOURTH EDITION TIMOTHY J. KLOPPENBORG Xavier University VITTAL ANANTATMULA Western Carolina University KATHRYN N. WELLS Keller Williams Real Estate Australia • Brazil • Mexico • Singapore • United Kingdom • United States Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. This is an electronic version of the print textbook. Due to electronic rights restrictions, some third party content may be suppressed. Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. The publisher reserves the right to remove content from this title at any time if subsequent rights restrictions require it. For valuable information on pricing, previous editions, changes to current editions, and alternate formats, please visit www.cengage.com/highered to search by ISBN#, author, title, or keyword for materials in your areas of interest. Important Notice: Media content referenced within the product description or the product text may not be available in the eBook version. Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Contemporary Project Management, Fourth Edition 2019 2015 Timothy J. Kloppenborg Cengage Learning Customer & Sales Support, 1-800-354-9706 www.cengage.com/permissions permissionrequest@cengage.com 2017947974 978 1 337 40645 1 Cengage Learning 20 02210 40 125 www.cengage.com. www.cengage.com www.cengagebrain.com Printed in the United States of America Print Number: 01 Print Year: 2017 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. MS Project 2016 Instructions in Contemporary Project Management 4e Chapter MS Project 3 MS Project 2016 Introduction Ribbon, Quick Access Toolbar, view panes, Zoom Slider, Shortcuts, Scheduling Mode Selector Setting Up Your First Project Auto schedule, start date, identifying information, summary row Create Milestone Schedule Key milestones, zero duration, must finish on, information 7 Set Up a Work Breakdown Structure (WBS) Understand the WBS definitions and displays Enter WBS Elements (tasks), Create the outline, Insert WBS Code Identifier column, Hide or show subtasks detail 8 Using MS Project for Critical Path Schedules Set Up the Project Schedule Set or update the project start date, Define organization’s working and nonworking time Build the Network Diagram and Identify the Critical Path Enter tasks and milestones, edit the timescale, understand and define task dependencies, assign task duration estimates, identify the critical path, understand the network diagram view Display and Print Schedules 9 Define Resources Resource views, max units, resource calendars Assigning Resources Basic assignment, modify an assignment Identify Overallocated Resources Resource usage and Detailed Gantt views together Overallocated Resources Finding overallocated resources, dealing with overallocations Crashing a Critical Path Activity 10 Develop Bottom-up Project Budget Assignment costs, task costs, various cost perspectives Develop Summary Project Budget 12 Baseline the Project Plan First time baseline, subsequent baselines, viewing variances 14 Using MS Project to Monitor and Control Projects What Makes a Schedule Useful? How MS Project recalculates based on reported actuals, current and future impacts of variances, define the performance update process (who, what, when) Steps to Update the Project Schedule Acquire performance data, set and display status date, Enter duration-based performance data, reschedule remaining work, revise future estimates 15 Close Project Creating project progress reports, sharing reports, export a report to MS Excel, archive project work, capture and publish lessons learned Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. PMBOK® Guide 6e Coverage in Contemporary Project Management 4e The numbers refer to the text page where the process is defined. Project management (PM) processes and knowledge areas 10–11 Project life cycle 7–10, 62–64 Projects and strategic planning 33–37 Organizational influences 102–110 Portfolio and program management 37–42 ® PMBOK Guide, 6th ed. Coverage Knowledge Areas Project Integration Management Initiating Process Group Develop Project Charter 60–79 Planning Process Group Develop Project Management Plan 409–410 Executing Process Group Monitoring & Controlling Process Group Closing Process Group Direct and Manage Project Work 459–460 Manage Project Knowledge 192–193, 504–508 Monitor and Control Project Work 460–462 Perform Integrated Change Control 229–232, 462–463 Close Project or Phase 503, 508–511 Project Scope Management Plan Scope Management 211–212 Collect Requirements 212–216 Define Scope 216–220 Create WBS 220–229 Validate Scope 500–501 Control Scope 475–476 Project Schedule Management Plan Schedule Management 246 Define Activities 249–253 Sequence Activities 253–255 Estimate Activity Durations 255–258 Develop Schedule 259–267 Control Schedule 476–480 Project Cost Management Plan Cost Management 329–330 Estimate Costs 330–341 Determine Budget 342–344 Control Costs 345, 476–480 Project Quality Management Plan Quality Management 401–404 Manage Quality 404–406, 469–474 Control Quality 406–409, 469–474 Project Resources Management Plan Resource Management 290–295 Estimate Activity Resources 290 Aquire Resources 138–141 Develop Team 141–157 Manage Team 157–161 Control Resources 476 Project Communications Management Plan Communications Management 188–192 Manage Communications 193–199, 465–467 Monitor Communications 467–468 Project Risk Management Plan Risk Management 360–366 Identify Risks 75, 366–368 Perform Qualitative Risk Analysis 75, 368–372 Perform Quantitative Risk Analysis 372–373 Plan Risk Responses 75, 373–377 Implement Risk Responses 464–465 Monitor Risks 463–464 Project Procurement Management Plan Procurement Management 431–433, 438–441 Conduct Procurements 434–438 Control Procurments 441 Plan Stakeholder Engagement 184–186 Manage Stakeholder Engagement 187–188 Monitor Stakeholder Engagement 188 Project Stakeholder Management Identify Stakeholders 75–77, 178–184 ® Guide), 6th ed. (Newtown Square, PA: Project Management Source: Adapted from A Guide to the Project Management Body of Knowledge (PMBOK Institute, Inc., 2017): 31. Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Brief Contents Preface xx About the Authors xxix PART PART PART 1 Organizing Projects 1 Introduction to Project Management 2 Project Selection and Prioritization 32 3 Chartering Projects 60 2 Leading Projects 4 Organizational Capability: Structure, Culture, and Roles 100 5 Leading and Managing Project Teams 136 6 Stakeholder Analysis and Communication Planning 176 3 Planning Projects 7 Scope Planning 210 8 Scheduling Projects 9 Resourcing Projects 286 2 244 10 Budgeting Projects 11 Project Risk Planning 358 12 Project Quality Planning and Project Kickoff 386 PART 4 328 Performing Projects 13 Project Supply Chain Management 14 Determining Project Progress and Results 456 15 Finishing the Project and Realizing the Benefits Appendix Appendix Appendix Appendix Appendix A B C D E 426 498 PMP and CAPM Exam Prep Suggestions 522 Agile Differences Covered 527 Answers to Selected Exercises 532 Project Deliverables 537 Strengths Themes As Used in Project Management Index 539 [Available Online] v Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Project Customer Tradeoff Matrix 1.2 Foundational Elements Life Cycle and Development Approach Elevator Pitch 2.4 Organizational Systems 3.4 Project Manager Competencies Selecting Projects Integration Leader Roles and Responsibilities Project Selection and Prioritization Matrix Project Resource Assignment Matrix 4.1 Develop Project Charter Charter Assumptions Log 4.2 Develop Project Management Plan 5.1 Plan Scope Management Scope 5.2 Collect Requirements Requirements Documents Scope 6.1 Plan Schedule Management Schedule Activities 7.1 Plan Cost Management Quality 8.1 Plan Quality Management Resources 9.1 Plan Resource Management 10.1 Plan Communications Management Communication 12.1 Plan Procurement Management Procurement 13.1 Identify Stakeholders Stakeholder Register Duration Estimates 7.3 Determine Budget Network 6.3 Sequence Activities 6.5 Develop Schedule Schedule Baseline Cost Baseline Quality Mgt. Plan RACI Team Charter Communications Matrix 11.1 Plan Risk Management Risk Stakeholders 7.2 Estimate Costs Scope Statement Activity List Milestone List 6.4 Estimate activity Durations Cost 5.4 Create WBS 9.2 Estimate Activity Resources 11.2 Identify Risks Risk Register 11.3 Perform Qualitative Risk Analysis Bid Documents Make or Buy Analysis Resource Requirements 11.5 Plan Risk Responses 11.4 Perform Quantitative Risk Analysis 13.2 Plan Stakeholder Stakeholders Engagement Engagement Assessment Matrix Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Realizing s PM Plan Baselines Life Cycle and Development Approach 4.5 Monitor and Control Project Work 4.3 Direct and Manage Project Work 4.4 Manage Project Knowledge s Analysis Lessons Learned Register 4.7 Close Project Closure Documents or Phase Customer Feedback Transition Plan 4.6 Perform Integrated Change Control Retrospectives Scope Baseline with WBS 5.5 Validate Scope 5.6 Control Scope 6.6 Control Schedule Resource Histogram Project Crashing 7.4 Control Costs Quality Reports 8.2 Manage Quality 8.3 Control Quality Scope Backlog Burn Down/Up Charts Earned Value Analysis Quality Measurements 9.3 Acquire Resources 9.4 Develop Team Team Assessments Team Assignments 9.6 Control Resources 9.5 Manage Team 10.2 Manage Communications Agendas Minutes Issues Log Meeting Evaluation 10.3 Monitor Communications Change Requests Progress Report 11.6 Implement Risk Responses 11.7 Monitor Risks 12.2 Conduct Procurements 12.3 Control Procurements 13.3 Manage Stakeholder Engagement Source Selection Matrix 13.4 Monitor Stakeholder Engagement Copyright 2019 Cengage Learning. 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Contents Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xx About the Authors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxix PART CHAPTER 1 Organizing Projects 1 Introduction to Project Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1.1 What Is a Project? 3 1.2 History of Project Management 5 1.3 How Can Project Work Be Described? 6 1.3a Projects versus Operations 6 / 1.3b Soft Skills and Hard Skills and Responsibility 7 / 1.3d Project Life Cycle 7 7 / 1.3c Authority 1.4 Understanding Projects 10 1.4a Project Management Institute 10 / 1.4b Project Management Body of Knowledge (PMBOK ) 10 / 1.4c The PMI Talent Triangle 11 / 1.4d Selecting and Prioritizing Projects 14 / 1.4e Project Goals and Constraints 14 / 1.4f Defining Project Success and Failure 15 / 1.4g Using Microsoft Project to Help Plan and Measure Projects 16 / 1.4h Types of Projects 16 / 1.4i Scalability of Project Tools 17 ® 1.5 Project Roles 17 1.5a Project Executive-Level Roles 18 / 1.5b Project Management-Level Roles 1.5c Project Associate-Level Roles 20 19 / 1.6 Overview of the Book 20 1.6a Part 1: Organizing and Initiating Projects 20 / 1.6b Part 2: Leading Projects 1.6c Part 3: Planning Projects 21 / 1.6d Part 4: Performing Projects 23 PMP/CAPM Study Ideas Summary 23 24 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 25 26 Integrated Example Projects 27 Suburban Homes Construction Project Casa DE PAZ Development Project Semester Project Instructions Project Management in Action Endnotes 24 25 PMBOK Guide Questions References 21 / 27 28 28 29 30 31 viii Copyright 2019 Cengage Learning. 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Contents CHAPTER ix 2 Project Selection and Prioritization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 2.1 Strategic Planning Process 33 2.1a Strategic Analysis 33 / 2.1b Guiding Principles Objectives 36 / 2.1d Flow-Down Objectives 37 34 / 2.1c Strategic 2.2 Portfolio Management 37 2.2a Portfolios 38 / 2.2b Programs 39 / 2.2c Projects and Subprojects 39 / 2.2d Assessing an Organization’s Ability to Perform Projects 42 / 2.2e Identifying Potential Projects 42 / 2.2f Using a Cost-Benefit Analysis Model to Select Projects 43 / 2.2g Using a Scoring Model to Select Projects 45 / 2.2h Prioritizing Projects 48 / 2.2i Resourcing Projects 48 2.3 Securing Projects 49 2.3a Identify Potential Project Opportunities 50 / 2.3b Determine Which Opportunities to Pursue 50 / 2.3c Prepare and Submit a Project Proposal 51 / 2.3d Negotiate to Secure the Project 51 PMP/CAPM Study Ideas Summary 52 52 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 53 53 PMBOK Guide Questions Exercises 53 54 Integrated Example Projects 55 Casa DE PAZ Development Project Semester Project Instructions Endnotes CHAPTER 56 56 Project Management in Action References 52 57 58 59 3 Chartering Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 3.1 What Is a Project Charter? 62 3.2 Why Is a Project Charter Used? 3.3 When Is a Charter Needed? 63 64 3.4 Typical Elements in a Project Charter 65 3.4a Title 65 / 3.4b Scope Overview 65 / 3.4c Business Case 66 / 3.4d Background 66 / 3.4e Milestone Schedule with Acceptance Criteria 66 / 3.4f Risks, Assumptions, and Constraints 67 / 3.4g Resource Estimates 69 / 3.4h Stakeholder List 69 / 3.4i Team Operating Principles 69 / 3.4j Lessons Learned 70 / 3.4k Signatures and Commitment 70 3.5 Constructing a Project Charter 70 3.5a Scope Overview and Business Case Instructions 70 / 3.5b Background Instructions 71 / 3.5c Milestone Schedule with Acceptance Criteria Instructions 72 / 3.5d Risks, Assumptions, and Constraints Instructions 75 / 3.5e Resources Needed Instructions 75 / 3.5f Stakeholder List Instructions 75 / Copyright 2019 Cengage Learning. 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Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. x Contents 3.5g Team Operating Principles Instructions 77 / 3.5h Lessons Learned Instructions 77 / 3.5i Signatures and Commitment Instructions 78 3.6 Ratifying the Project Charter 79 3.7 Starting a Project Using Microsoft Project 79 3.7a MS Project 2016 Introduction 80 / 3.7b Setting up Your First Project 3.7c Define Your Project 82 / 3.7d Create a Milestone Schedule 83 PMP/CAPM Study Ideas Summary 88 88 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 89 90 Integrated Example Projects 91 Casa DE PAZ Development Project Semester Project Instructions Project Management in Action References Endnotes PART CHAPTER 2 88 89 89 PMBOK Guide Questions Exercises 81 / 93 93 93 96 97 Leading Projects 4 Organizational Capability: Structure, Culture, and Roles . . . . . . . . . . . . . . . . . . . . . 100 4.1 Types of Organizational Structures 103 4.1a Functional 103 / 4.1b Projectized 104 / 4.1c Matrix 105 4.2 Organizational Culture and Its Impact on Projects 109 4.2a Culture of the Parent Organization 110 / 4.2b Project Cultural Norms 111 4.3 Project Life Cycles 111 4.3a Define-Measure-Analyze-Improve-Control (DMAIC) Model 112 / 4.3b Research and Development (R&D) Project Life Cycle Model 113 / 4.3c Construction Project Life Cycle Model 113 / 4.3d Agile Project Life Cycle Model 113 4.4 Agile Project Management 114 4.4a What Is Agile? 114 / 4.4b Why Use Agile? 114 / 4.4c What Is an Agile Mindset? 114 / 4.4d What Are the Key Roles in Agile Projects? 115 / 4.4e How Do You Start an Agile Project? 115 / 4.4f How Do You Continue an Agile Project? 115 / 4.4g What Is Needed for Agile to Be Successful? 116 4.5 Traditional Project Executive Roles 116 4.5a Steering Team 116 / 4.5b Sponsor 117 / 4.5c Customer Projects Officer/Project Management Office 121 4.6 Traditional Project Management Roles 121 4.6a Functional Manager 121 / 4.6b Project Manager 119 / 4.5d Chief 122 / 4.6c Facilitator 4.7 Traditional Project Team Roles 126 4.7a Core Team Members 126 / 4.7b Subject Matter Experts 124 126 Copyright 2019 Cengage Learning. 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Contents 4.8 Role Differences on Agile Projects PMP/CAPM Study Ideas Summary 126 128 128 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 129 129 130 Integrated Example Projects 130 Casa DE PAZ Development Project Semester Project Instructions Endnotes CHAPTER 131 131 Project Management in Action References 128 129 PMBOK Guide Questions Exercises xi 132 134 135 5 Leading and Managing Project Teams . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 5.1 Acquire Project Team 138 5.1a Preassignment of Project Team Members 139 / 5.1b Negotiation for Project Team Members 139 / 5.1c On-Boarding Project Team Members 140 5.2 Develop Project Team 141 5.2a Stages of Project Team Development 142 / 5.2b Characteristics of High-Performing Project Teams 144 / 5.2c Assessing Individual Member Capability 147 / 5.2d Assessing Project Team Capability 148 / 5.2e Building Individual and Project Team Capability 150 / 5.2f Establishing Project Team Ground Rules 153 5.3 Manage Project Team 157 5.3a Project Manager Power and Leadership 157 / 5.3b Assessing Performance of Individuals and Project Teams 159 / 5.3c Project Team Management Outcomes 5.4 Relationship Building Within the Core Team 159 160 5.5 Managing Project Conflicts 161 5.5a Sources of Project Conflict 162 / 5.5b Conflict-Resolution Process and Styles 163 / 5.5c Negotiation 164 5.6 Communication Needs of Global and Virtual Teams 166 5.6a Virtual Teams 166 / 5.6b Cultural Differences 166 / 5.6c Countries and Project Communication Preferences 167 PMP/CAPM Study Ideas Summary 167 168 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 168 168 169 PMBOK Guide Questions Integrated Example Projects 170 170 Casa DE PAZ Development Project Semester Project Instructions 171 171 Copyright 2019 Cengage Learning. 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Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xii Contents Project Management in Action References Endnotes CHAPTER 172 174 175 6 Stakeholder Analysis and Communication Planning . . . . . . . . . . . . . . . . . . . . . . . . . 176 6.1 Identify Stakeholders 178 6.1a Find Stakeholders 179 / 6.1b Analyze Stakeholders Stakeholders 183 180 / 6.1c Document 6.2 Plan Stakeholder Engagement 184 6.2a Creating a Stakeholder Engagement Assessment Matrix Relationships with Stakeholders 185 6.3 Manage Stakeholder Engagement 187 6.4 Monitor Stakeholder Engagement 188 184 / 6.2b Planning to Build 6.5 Plan Communications Management 188 6.5a Purposes of a Project Communications Plan 188 / 6.5b Communications Plan Considerations 189 / 6.5c Communications Matrix 191 / 6.5d Manage Project Knowledge 192 6.6 Manage Communications 193 6.6a Determine Project Information Needs 193 / 6.6b Establish Information Retrieval and Distribution System 193 / 6.6c Project Meeting Management 194 / 6.6d Issues Management 197 PMP/CAPM Study Ideas Summary 199 199 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 200 200 PMBOK Guide Questions 201 Integrated Example Projects 202 Casa DE PAZ Development Project Semester Project Instructions Project Management in Action References Endnotes PART CHAPTER 3 200 202 203 204 206 207 Planning Projects 7 Scope Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 210 7.1 Plan Scope Management 211 7.2 Collect Requirements 212 7.2a Gather Stakeholder Input and Needs 213 7.3 Define Scope 217 7.3a Reasons to Define Scope 217 / 7.3b How to Define Scope Scope in Agile Projects 218 217 / 7.3c Defining Copyright 2019 Cengage Learning. 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Contents 7.4 Work Breakdown Structure (WBS) 220 7.4a What Is the WBS? 220 / 7.4b Why Use a WBS? 221 / 7.4c WBS Formats 222 / 7.4d Work Packages 224 / 7.4e How to Construct a WBS 7.5 Establish Change Control Summary 239 Chapter Review Questions Discussion Questions 239 240 241 Integrated Example Projects 241 Casa DE PAZ Development Project Semester Project Instructions CHAPTER 242 242 Project Management in Action References 239 239 PMBOK Guide Questions Exercises 232 237 Key Terms Consistent with PMI Standards and Guides ® 226 229 7.6 Using MS Project for Work Breakdown Structures (WBS) 7.6a Set Up a WBS in MS Project 232 PMP/CAPM Study Ideas xiii 242 243 8 Scheduling Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 244 8.1 Plan Schedule Management 246 8.2 Purposes of a Project Schedule 247 8.3 Historical Development of Project Schedules 247 8.4 How Project Schedules Are Limited and Created 8.5 Define Activities 248 249 8.6 Sequence Activities 253 8.6a Leads and Lags 254 / 8.6b Alternative Dependencies 8.7 Estimate Activity Duration 255 8.7a Problems and Remedies in Duration Estimating 255 256 / 8.7b Learning Curves 8.8 Develop Project Schedules 259 8.8a Two-Pass Method 259 / 8.8b Enumeration Method 258 263 8.9 Uncertainty in Project Schedules 264 8.9a Program Evaluation and Review Technique 265 / 8.9b Monte Carlo Simulation 8.10 Show the Project Schedule on a Gantt Chart 268 266 8.11 Using Microsoft Project for Critical Path Schedules 268 8.11a Set up the Project Schedule 269 / 8.11b Build the Network Diagram and Identify the Critical Path 270 PMP/CAPM Study Ideas Summary 275 276 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions 276 277 277 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xiv Contents Exercises ® 278 PMBOK Guide Questions 280 Integrated Example Projects 281 Casa DE PAZ Development Project Semester Project Instructions 283 Project Management in Action References Endnotes CHAPTER 281 283 284 285 9 Resourcing Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286 9.1 Abilities Needed When Resourcing Projects 288 9.1a The Science and Art of Resourcing Projects 288 / 9.1b Considerations When Resourcing Projects 288 / 9.1c Activity- versus Resource-Dominated Schedules 289 9.2 Estimate Resource Needs 290 9.3 Plan Resource Management 290 9.3a Identify Potential Resources 291 / 9.3b Determine Resource Availability 9.3c Decide Timing Issues When Resourcing Projects 294 9.4 Project Team Composition Issues 295 9.4a Cross-Functional Teams 295 / 9.4b Co-Located Teams Teams 295 / 9.4d Outsourcing 295 293 / 295 / 9.4c Virtual 9.5 Assign a Resource to Each Activity 296 9.5a Show Resource Responsibilities on RACI Chart 297 / 9.5b Show Resource Assignments on Gantt Chart 297 / 9.5c Summarize Resource Responsibilities by Time Period with Histogram 297 9.6 Dealing with Resource Overloads 300 9.6a Methods of Resolving Resource Overloads 9.7 Compress the Project Schedule 303 9.7a Actions to Reduce the Critical Path Tracking 307 300 303 / 9.7b Crashing 304 / 9.7c Fast 9.8 Alternative Scheduling Methods 309 9.8a Critical Chain Project Management (CCPM) 309 / 9.8b Reverse Phase Schedules 310 / 9.8c Rolling Wave Planning 310 / 9.8d Agile Project Planning 310 / 9.8e Auto/Manual Scheduling 310 9.9 Using MS Project for Resource Allocation 311 9.9a Step 1: Defining Resources 311 / 9.9b Step 2: Set Up a Resource Calendar 312 / 9.9c Step 3: Assigning Resources 312 / 9.9d Step 4: Finding Overallocated Resources 315 / 9.9e Step 5: Dealing with Overallocations 316 / 9.9f Crashing a Critical Path Activity 317 PMP/CAPM Study Ideas Summary 319 319 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 320 320 PMBOK Guide Questions Exercises 320 321 322 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Contents Integrated Example Projects 324 Casa DE PAZ Development Project Semester Project Instructions Endnote CHAPTER 324 325 Project Management in Action References xv 325 327 327 10 Budgeting Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 328 10.1 Plan Cost Management 329 10.2 Estimate Cost 330 10.2a Types of Cost 331 / 10.2b Accuracy and Timing of Cost Estimates 334 / 10.2c Methods of Estimating Costs 335 / 10.2d Project Cost Estimating Issues 10.3 Determine Budget 342 10.3a Aggregating Costs 342 / 10.3b Analyzing Reserve Needs 10.3c Determining Cash Flow 344 10.4 Establishing Cost Control Summary 345 / 10.5b Develop Summary 349 349 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 350 351 352 Integrated Example Projects 353 Casa DE PAZ Development Project Semester Project Instructions Project Management in Action References Endnotes CHAPTER 350 350 PMBOK Guide Questions Exercises 342 / 345 10.5 Using MS Project for Project Budgets 345 10.5a Developing a Bottom-Up Project Budget Estimate Project Budget 347 PMP/CAPM Study Ideas 338 354 354 354 356 356 11 Project Risk Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358 11.1 Plan Risk Management 360 11.1a Roles and Responsibilities 362 / 11.1b Categories and Definitions 11.2 Identify Risks 366 11.2a Information Gathering 366 / 11.2b Reviews Relationships 368 / 11.2d Risk Register 368 362 367 / 11.2c Understanding 11.3 Risk Analysis 368 11.3a Perform Qualitative Risk Analysis 368 / 11.3b Perform Quantitative Risk Analysis 372 / 11.3c Risk Register Updates 373 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xvi Contents 11.4 Plan Risk Responses 373 11.4a Strategies for Responding to Risks PMP/CAPM Study Ideas Summary 373 / 11.4b Risk Register Updates 377 378 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 379 379 380 Integrated Example Projects 381 Casa DE PAZ Development Project Semester Project Instructions Endnotes CHAPTER 381 382 Project Management in Action References 378 379 PMBOK Guide Questions Exercises 377 382 384 384 12 Project Quality Planning and Project Kickoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386 12.1 Development of Contemporary Quality Concepts 388 12.1a Quality Gurus 388 / 12.1b Total Quality Management/Malcolm Baldrige 12.1c ISO 9001:2008 390 / 12.1d Lean Six Sigma 390 389 / 12.2 Core Project Quality Concepts 392 12.2a Stakeholder Satisfaction 393 / 12.2b Process Management 394 / 12.2c FactBased Management 396 / 12.2d Fact-Based Project Management Example 398 / 12.2e Empowered Performance 399 / 12.2f Summary of Core Concepts 400 12.3 Plan Quality Management 401 12.3a Quality Policy 401 / 12.3b Quality Management Plan Contents 403 / 12.3c Quality Baseline 404 / 12.3d Process Improvement Plan 404 12.4 Manage Quality 404 12.5 Control Quality 406 12.6 Cost of Quality 409 12.7 Develop Project Management Plan 409 12.7a Resolve Conflicts 409 / 12.7b Establish Configuration Management 12.7c Apply Sanity Tests to All Project Plans 410 12.8 Kickoff Project 410 12.8a Preconditions to Meeting Success 411 / 12.8b Meeting Activities 12.9 Baseline and Communicate Project Management Plan 410 / 411 413 12.10 Using MS Project for Project Baselines 413 12.10a Baseline the Project Plan 413 / 12.10b Create the First Time Baseline 414 / 12.10c Subsequent Baselines 414 / 12.10d Viewing Baselines and Variances 415 PMP/CAPM Study Ideas Summary 416 417 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions 417 418 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Contents Discussion Questions ® 418 PMBOK Guide Questions Exercises 418 419 Integrated Example Projects 420 Casa DE PAZ Development Project Semester Project Instructions Endnotes PART CHAPTER 4 420 420 Project Management in Action References xvii 421 423 424 Performing Projects 13 Project Supply Chain Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 426 13.1 Introduction to Project Supply Chain Management 428 13.1a SCM Components 430 / 13.1b SCM Factors 430 / 13.1c SCM Decisions 430 / 13.1d Project Procurement Management Processes 431 13.2 Plan Procurement Management 431 13.2a Outputs of Planning 431 / 13.2b Make-or-Buy Decisions 432 13.3 Conduct Procurements 434 13.3a Sources for Potential Suppliers 434 / 13.3b Approaches Used When Evaluating Prospective Suppliers 435 / 13.3c Supplier Selection 436 13.4 Contract Types 438 13.4a Fixed-Price Contracts 439 / 13.4b Cost-Reimbursable Contracts 13.4c Time and Material (T&M) Contracts 440 13.5 Control Procurements 441 13.6 Improving Project Supply Chains 441 13.6a Project Partnering and Collaboration 442 / 13.6b Third Parties Purchasing 447 / 13.6d Sourcing 447 / 13.6e Logistics 447 / 13.6f Information 448 PMP/CAPM Study Ideas Summary 448 Chapter Review Questions Discussion Questions ® 449 450 451 Integrated Example Projects 451 Casa DE PAZ Development Project Semester Project Instructions Project Management in Action Endnotes 449 449 PMBOK Guide Questions References 447 / 13.6c Lean 448 Key Terms Consistent with PMI Standards and Guides Exercises 440 / 452 452 452 453 454 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xviii Contents CHAPTER 14 Determining Project Progress and Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 456 14.1 Project Balanced Scorecard Approach 458 14.2 Internal Project Issues 459 14.2a Direct and Manage Project Work 459 / 14.2b Monitor and Control Project Work 460 / 14.2c Monitoring Project Risk 463 / 14.2d Implement Risk Responses 464 / 14.2e Manage Communications 465 / 14.2f Monitor Communications 467 14.3 Customer Issues 469 14.3a Manage and Control Quality 469 / 14.3b Control Scope 475 14.4 Financial Issues 476 14.4a Control Resources 476 / 14.4b Control Schedule and Costs Value Management for Controlling Schedule and Costs 476 476 / 14.4c Earned 14.5 Using MS Project to Monitor and Control Projects 480 14.5a What Makes a Schedule Useful? 480 / 14.5b How MS Project Recalculates the Schedule Based on Reported Actuals 481 / 14.5c Current and Future Impacts of Time and Cost Variance 481 / 14.5d Define the Performance Update Process 481 / 14.5e Steps to Update the Project Schedule 482 14.6 Replanning If Necessary 487 PMP/CAPM Study Ideas 488 Summary 488 Key Terms Consistent with PMI Standards and Guides Chapter Review Questions Discussion Questions ® 489 489 PMBOK Guide Questions Exercises 490 491 Integrated Example Projects 492 Casa DE PAZ Development Project Semester Project Instructions Project Management in Action References Endnotes CHAPTER 488 493 493 494 496 497 15 Finishing the Project and Realizing the Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498 15.1 Validate Scope 500 15.2 Terminate Projects Early 501 15.3 Close Project 503 15.3a Write Transition Plan 503 / 15.3b Knowledge Management the Closeout Report 508 504 / 15.3c Create 15.4 Post-Project Activities 509 15.4a Reassign Workers 509 / 15.4b Celebrate Success and Reward Participants 15.4c Provide Ongoing Support 510 / 15.4d Ensure Project Benefits Are Realized 510 509 / Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Contents 15.5 Using MS Project for Project Closure 15.5a Creating Project Progress Reports PMP/CAPM Study Ideas Summary 511 511 / 15.5b Archiving Project Work 515 Chapter Review Questions Discussion Questions 516 517 Integrated Example Projects 517 Casa DE PAZ Development Project Semester Project Instructions Project Management in Action References Endnotes 515 515 516 PMBOK Guide Questions Exercise 512 515 Key Terms Consistent with PMI Standards and Guides ® xix 518 518 518 520 521 Appendix A PMP and CAPM Exam Prep Suggestions . . . . . . . . . . . . . . . . . . . . . . . . . . 522 Appendix B Agile Differences Covered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 527 Appendix C Answers to Selected Exercises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 532 Appendix D Project Deliverables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 537 Appendix E Strengths Themes As Used in Project Management . . . . [Available Online] Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Preface While project managers today still need to use many techniques that have stood the test of several decades, they increasingly also must recognize the business need for a project, sort through multiple conflicting stakeholder demands. They must know how to deal with rapid change, a myriad of communication issues, global and virtual project teams, modern approaches to quality improvement, when to tailor their project management approach to include methods and behaviors from Agile, and many other issues that are more challenging than those in projects of the past. Contemporary project management utilizes the tried-and-true project management techniques along with modern improvements such as the most current versions of Microsoft Project Professional 2016, the sixth edition of the Guide to the Project Management Body of Knowledge (PMBOK Guide), and many approaches derived from adaptive (Agile) project management. Contemporary project management also uses many tools and understandings that come from modern approaches to quality and communications, expanded role definitions, leadership principles, human strengths, and many other sources. Contemporary project management is scalable, using simple versions of important techniques on small projects and more involved versions on more complex projects. ® ® Distinctive Approach This book covers contemporary project management topics using contemporary project management methods. For example, when considering the topic of dealing with multiple stakeholders, every chapter was reviewed by students, practitioners, and academics. This allowed simultaneous consideration of student learning, practitioner realism, and academic research and teaching perspectives. The practical examples and practitioner reviewers came from a variety of industries, different parts of the world, and from many sizes and types of projects in order to emphasize the scalability and universality of contemporary project management techniques. New to This Edition Core, behavioral, and technical learning objectives. We have expanded the number of learning objectives and classified them as core, behavioral, or technical. About half of the objectives are core: what we believe every student of project management should learn. A professor could teach a solid project management introductory class by deeply using only the core objectives. On the other hand, there are measurable student objectives for either a behavioral or a technical approach. All suggested student assignments and questions are tied specifically to one of the learning objectives. A professor could use this text for a two-semester sequence that emphasizes both indepth behavioral and technical approaches. Videos. Exclusively available to those using the MindTap product for this book, we have created dozens of short (average time, five minutes) videos to show the art of many of the techniques. These demonstrate the use of many of the techniques in a by-hand or spreadsheet fashion as well as using Microsoft Project 2016. Several questions that can be assigned to students are included with the videos that xx Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Preface xxi demonstrate how to use Microsoft Project to complement learning. Answers (sometimes definitive, sometimes representative, depending on the nature of the technique) are included in the instructor’s manual (IM). Extensive flowchart to help the sixth edition of the PMBOK Guide come to life. All sixth edition PMBOK Guide knowledge areas, processes, and process groups, plus major deliverables from each process and the primary workflows between them, are specifically included in an interactive, color-coded flowchart that is included in full inside the back cover of the text. We also start each chapter by showing the portion of the flowchart that is covered in that chapter. We now use definitions both from the PMBOK Guide, Sixth Edition and also from more than a dozen Project Management Institute specialized Practice Guides and Standards. The end of each chapter contains specific suggestions for PMP and CAPM test preparation pertaining to the chapter’s topics plus ten PMBOK Guide-type questions that are typical of what would be seen on PMP and CAPM exams. Appendix A gives general study suggestions for the CAPM and PMP exams. Project deliverables. A list of 38 project deliverables that can be used as assignments for students and in-class exercises are included in Appendix D. Each deliverable is specifically tied to a student learning objective and shown on the PMBOK Guide flowchart. About half of these are core, while the others are behavioral or technical. Examples of completed deliverables are included in the text. Teaching suggestions and grading rubrics are included in the IM. Appendix D identifies the type of objective, chapter covered, and PMBOK Guide process, knowledge area, and process group in which the deliverable is typically created on a real project. Substantial increase in Agile coverage. Agile techniques and methods are considered much more often than even three years ago. As such, many experienced project managers who have also become Agile proponents have contributed to the increased Agile coverage in this book. At multiple points in most chapters, if Agile methods or suggested behaviors are different from traditional project management, these variations are noted. We use an Agile icon to draw attention to these. We also have created Appendix B, which is a bulleted list of the approximately 180 differences between Agile and traditional project management that are discussed in the book. This extensive coverage allows a professor to teach project management emphasizing an Agile approach, if desired. It also allows a professor to develop an Agile project management course. Two new continuing project examples. We have created two project examples that are included in all 15 chapters of the text. One project is a construction project by a for-profit company that is planned and managed in a traditional fashion. The other is a development project at a nonprofit that is planned and managed in a more (but not exclusively) Agile fashion. In Chapter 1, we introduce both these case studies. After that, we alternate chapters, with each chapter showing what one project did using the concepts and techniques of a chapter and posing questions for the students to answer about the other project. Answers to the questions are in the IM. This can be another useful vehicle for students to practice their skills and to generate class discussion. ® ® ® ® ® ® ® ® ® ® ® ® Distinctive Features ® PMBOK Guide, Sixth Edition approach. This consistency with the current standard gives students a significant leg up if they decide to become certified Project Management Professionals (PMPs ) or Certified Associates in Project Management ® Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xxii Preface ® ® (CAPMs ). This text includes an color-coded PMBOK Guide, Sixth Edition flowchart, all definitions consistent with PMI guides and standards, CAPM and PMP test preparation suggestions, and test practice questions. Actual project as learning vehicle. A section at the end of each chapter lists deliverables for students to create (in teams or individually) for a real project. These assignments have been refined over the last two decades while working with the local PMI chapter, which provided a panel of PMP judges to evaluate projects from a practical point of view. Included in the IM are extensive tools and suggestions developed over the last 20 years for instructors, guiding them as they have students learn in the best possible way—with real projects. Students are encouraged to keep clean copies of all deliverables so they can demonstrate their project skills in job interviews. A listing of these deliverables is included in Appendix D. Student-oriented, measurable learning objectives. Each chapter begins with a list of the core objectives for the chapter along with more in-depth behavioral and/or technical objectives for most chapters. The chapter also starts with showing the PMBOK topics covered in the chapter. The chapter material, end-of-chapter questions and problems, PowerPoint slides, all deliverables, and test questions have all been updated to correlate to specific objectives. Microsoft Project Professional 2016 fully integrated into the fabric of eight chapters. Microsoft Project Professional 2016 is shown in a step-by-step manner with numerous screen captures. On all screen captures, critical path activities are shown in contrasting color for emphasis. We have created videos to demonstrate these techniques and developed questions tied to specific learning objectives that can be assigned to the videos to test student learning. Blend of traditional and modern methods. Proven methods developed over the past half century are combined with exciting new methods, including Agile, that are emerging from both industry and research. This book covers the responsibilities of many individuals who can have an impact on projects both as they are practiced in traditional and in Agile environments, so aspiring project managers can understand not only their own roles, but also those of people with whom they need to interact. Integrated example projects. A variety of experienced project leaders from around the world have contributed examples to demonstrate many of the techniques and concepts throughout the book. These highly experienced and credentialed managers have worked closely with the authors to ensure that the examples demonstrate ideas discussed in the chapter. The variety of industries, locations, and sizes of the projects help the students to visualize both how universal project management is and how to appropriately scale the planning and management activities. ® ® ® ® ® ® Organization of Topics The book is divided into four major parts. Part 1, Organizing Projects, deals with getting a project officially approved. Chapter 1 introduces contemporary project management by first tracing the history of project management and then discussing what makes a project different from an ongoing operation. Various frameworks that help one understand projects— such as the PMBOK Guide and Agile—are introduced, as well as the executive-, managerial-, and associate-level roles in managing projects. Chapter 2 discusses how projects support and are an outgrowth of strategic planning, how a portfolio of projects is selected and prioritized, how a client company ® Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Preface xxiii selects a contractor company to conduct a project, and how a contractor company secures project opportunities from client companies. Chapter 3 presents project charters in a step-by-step fashion. Short, powerful charters help all key participants to develop a common understanding of key project issues and components at a high level and then to formally commit to the project. Charters have become nearly universal in initiating projects in recent years. Microsoft Project Professional 2016 is utilized to show milestone schedules within charters. ® Part 2, Leading Projects, deals with understanding the project environment and roles and dealing effectively with team members and stakeholders. Chapter 4 deals with organizational capability issues of structure, life cycle, culture, and roles. The choices parent organizations make in each of these provide both opportunities and limitations to how projects can be conducted. Chapter 5 deals with leading and managing the project team. It includes acquiring and developing the project team, assessing both potential and actual performance of team members and the team as a whole, various types of power a project manager can use, and how to deal productively with project conflict. Chapter 6 introduces methods for understanding and prioritizing various stakeholder demands and for building constructive relationships with stakeholders. Since many projects are less successful due to poor communications, detailed communication planning techniques are introduced along with suggestions for managing meetings, an important channel of communication. Part 3, Planning Projects, deals with all aspects of project planning as defined in thePMBOK Guide. It proceeds in the most logical order possible to maximize effectiveness and stress continuity, so that each chapter builds on the previous ones, and students can appreciate the interplay between the various knowledge areas and processes. ® Chapter 7 helps students understand how to determine the amount of work the project entails. Specifically covered are methods for determining the scope of both the project work and outputs, the work breakdown structure (WBS) that is used to ensure nothing is left out, and how the WBS is portrayed using Microsoft Project Professional 2016. Chapter 8 is the first scheduling chapter. It shows how to schedule project activities by identifying, sequencing, and estimating the durations for each activity. Then, critical path project schedules are developed, and methods are shown for dealing with uncertainty in time estimates, Gantt charts are introduced for easier communications, and Microsoft Project Professional 2016 is used to automate the schedule development and communications. Chapter 9 is the second scheduling chapter. Once the critical path schedule is determined, staff management plans are developed, project team composition issues are considered, resources are assigned to activities, and resource overloads are identified and handled. Schedule compression techniques of crashing and fast tracking are demonstrated, and multiple alternative scheduling techniques including Agile are introduced. Resource scheduling is demonstrated with Microsoft Project Professional 2016. Chapter 10 deals with project budgeting. Estimating cost, budgeting cost, and establishing cost controls are demonstrated. Microsoft Project Professional 2016 is used for developing both bottom-up and summary project budgets. Chapter 11 demonstrates project risk planning. It includes risk management planning methods for identifying risks, establishing a risk register, qualitatively analyzing ® ® ® ® Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xxiv Preface risks for probability and impact, quantitatively analyzing risks if needed, and deciding how to respond to each risk with contingency plans for major risks and awareness for minor risks. Chapter 12 starts by covering project quality planning. This includes explaining the development of modern quality concepts and how they distill into core project quality demands. Next, the chapter covers how to develop a project quality plan. It then ties all of the planning chapters together with discussions of a project kickoff meeting, a baselined project plan, and the ways Microsoft Project Professional 2016 can be used to establish and maintain the baseline. ® Part 4, Performing Projects, discusses the various aspects that must be managed simultaneously while the project is being conducted. Chapter 13 deals with project supply chain management issues. Some of these issues, such as developing the procurement management plan, qualifying and selecting vendors, and determining the type of contract to use are planning issues, but for simplicity, they are covered in one chapter with sections on how to conduct and control procurements and to improve the project supply chain. Chapter 14 is concerned with determining project results. This chapter starts with a balanced scorecard approach to controlling projects. Internal project issues covered include risk, change, and communication. Quality is also covered, with an emphasis on achieving client satisfaction. Financial issues discussed are scope, cost, and schedule, including how to use Microsoft Project Professional 2016 for control. Chapter 15 deals with how to end a project—either early or on time. This includes validating to ensure all scope is complete, formally closing procurements and the project, knowledge management, and ensuring the project participants are rewarded and the clients have the support they need to realize intended benefits when using the project deliverables. ® MindTap MindTap is a complete digital solution for your project management course. It has enhancements that take students from learning basic concepts to actively engaging in critical thinking applications, while learning Project 2016 skills for their future careers. The MindTap product for this book features videos from the authors that explain tricky concepts, videos that explain the finer points of what you can do with Project 2016, and quizzes and homework assignments with detailed feedback so that students will have a better understanding of why an answer is right or wrong. Instructor Resources To access the instructor resources, go to www.cengage.com/login, log in with your SSO account username and password, and search this book’s ISBN (9781337406451) to add instructor resources to your account. Key support materials—instructor’s manual with solutions, test bank in Word and Blackboard formats, data set solutions, and PowerPoint presentations—provide instructors with a comprehensive capability for customizing their classroom experience. All student resources are also available on the instructor companion site. ® Instructor s Manual with Solutions. Prepared by Tim Kloppenborg and updated by Kate Wells, based on their years of experience facilitating the student learning experience in their own project management classes (undergraduate, MBA, Masters in Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Preface xxv Health Informatics, and continuing education on six continents), with teaching in classroom, hybrid, and online formats, each chapter of the instructor’s manual includes an overview of core, behavioral, and technical learning objectives, detailed chapter outlines, teaching recommendations for both classroom and online, and many specific suggestions for implementing community-based projects into your project management class. Solutions are also provided for all of the end-of-chapter content. Microsoft Word Test Bank. Prepared for this edition by Joyce D. Brown, PMP and Thomas F. McCabe, PMP of the University of Connecticut, this comprehensive test bank builds upon the original test bank created by Kevin Grant of the University of Texas at San Antonio. The test bank is organized around each chapter’s learning objectives. All test questions are consistent with the PMBOK . Every test item is labeled according to its difficulty level, the learning objective within the textbook to which it relates, and its Blooms Taxonomy level, allowing instructors to quickly construct effective tests that emphasize the concepts most significant for their courses. The test bank includes true/false, multiple choice, essay, and quantitative problems for each chapter. Cognero Test Bank. Cengage Learning Testing Powered by Cognero is a flexible, online system that allows you to author, edit, and manage test bank content from multiple Cengage Learning solutions; create multiple test versions in an instant; and deliver tests from your LMS, your classroom, or wherever you want. The Cognero test bank contains the same questions that are in the Microsoft Word test bank. PowerPoint Presentations. Prepared by Kate Wells, the PowerPoint presentations provide comprehensive coverage of each chapter’s essential concepts in a clean, concise format. Instructors can easily customize the PowerPoint presentations to better fit the needs of their classroom. Templates. Electronic templates for many of the techniques (student deliverables) are available on the textbook companion website. These Microsoft Word and Excel documents can be downloaded and filled in for ease of student learning and for consistency of instructor grading. ® ® ® ® ® ® Student Resources Students can access the following resources by going to www.cengagebrain.com and searching 9781337406451. The companion website for this book has Excel and Word Project templates, data sets for selected chapters, and instructions for how to get access to a trial version of Microsoft Online Professional Trial. (Note that while we are happy to provide instructions for accessing this trial, Microsoft controls that access and we are not responsible for it being removed in the future.) Acknowledgments A book-writing project depends on many people. Through the last three decades of project work, we have been privileged to learn from thousands of people, including students, faculty members, co-trainers, co-consultants, co-judges, clients, research partners, trade book authors, and others. Hundreds of individuals who have provided help in research and developing teaching methods are co-members of the following: PMI’s undergraduate curriculum guidelines development team, PMI’s Global Accreditation Center, Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xxvi Preface Multiple chapters of the Project Management Institute, The Cincinnati and Louisville sections of the Center for Quality of Management, Project Management Executive Forum, and Agile Cincinnati. We also want to acknowledge the wonderful help of various professionals at Cengage Learning, including Aaron Arnsparger (Sr. Product Manager) and Conor Allen (Content Developer). We also want to thank Charles McCormick, Jr., retired Senior Acquisitions Editor, for his extensive help and guidance on the first and second editions of Contemporary Project Management. Other individuals who have provided significant content are Nathan Johnson of Western Carolina University, who provided the Microsoft Project 2016 material, Joyce D. Brown, PMP and Thomas F. McCabe, PMP of University of Connecticut, who revised the test bank and provided additional PMBOK questions to each chapter, Jim King, who professionally taped and edited videos, and Kathryn N. Wells, Independent Consultant, PMP , CAPM , who provided the PowerPoint presentations. Special thanks are also due to all the people whose feedback and suggestions have shaped this edition of Contemporary Project Management as well as the previous two editions: ® ® ® Stephen Allen, Truman State University Siti Arshad-Snyder, Clarkson College Loretta Beavers, Southwest Virginia Community College Shari Bleure, Skyline Chili Neil Burgess, Albertus Magnus College John Cain, Viox Services Robert Clarkson, Davenport University Nancy Cornell, Northeastern University Steve Creason, Metropolitan State University ® ® Carol Abbott, Fusion Alliance, Inc. Reynold Byers, Arizona State University ® Jacob J. Dell, University of Texas at San Antonio Kevin P. Grant, University of Texas–San Antonio Scott Dellana, East Carolina University Joseph Griffin, Northeastern University Maling Ebrahimpour, Roger Williams University Raye Guye, ILSCO Corporation Jeff Flynn, ILSCO Corporation William M. Hayden Jr., State University of New York at Buffalo Jim Ford, University of Delaware Sarai Hedges, University of Cincinnati Lynn Frock, Lynn Frock & Company Marco Hernandez, Dantes Canadian Lei Fu, Hefei University of Technology Stephen Holoviak, Pennsylvania State University Patricia Galdeen, Lourdes University Bill Holt, North Seattle Community College Kathleen Gallon, Christ Hospital Paul Gentine, Bethany College Morris Hsi, Lawrence Tech University Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Preface xxvii Sonya Hsu, University of Louisiana Lafayette James Leaman, Eastern Mennonite University Peerasit Patanakul, Stevens Institute of Technology Paul Hudec, Milwaukee School of Engineering Linda LeSage, Davenport University Joseph Petrick, Wright State University Claudia Levi, Edmonds Community College Kenneth R. Pflieger, Potomac College Anil B. Jambekar, Michigan Technological University Dana Johnson, Michigan Technological University Robert Judge, San Diego State University David L. Keeney, Stevens Institute of Technology George Kenyon, Lamar University Naomi Kinney, MultiLingual Learning Services Paul Kling, Duke Energy Matthew Korpusik, Six Sigma Black Belt Sal Kukalis, California State University–Long Beach Young Hoon Kwak, George Washington University Laurence J. Laning, Procter & Gamble Dick Larkin, Central Washington University Lydia Lavigne, Ball Aerospace Jon Lazarus, Willamette University Marvette Limon, University of Houston Downtown John S. Loucks, St. Edward’s University Diane Lucas, Penn State University– DuBois Campus Clayton Maas, Davenport University S. G. Marlow, California State Polytechnic University Daniel S. Marrone, SUNY Farmingdale State College Chris McCale, Regis University Abe Meilich, Walden University Bruce Miller, Xavier Leadership Center Ali Mir, William Paterson University William Moylan, Eastern Michigan University Merlin Nuss, MidAmerica Nazarene University Warren Opfer, Life Science Services International Charles K. Pickar, Johns Hopkins University Connie Plowman, Portland Community College Mark Poore, Roanoke College Antonios Printezis, Arizona State University Joshua Ramirez, PMP, MSM-PM, Columbia Basin College Chris Rawlings, Bob Jones University Natalee Regal, Procter & Gamble Pedro Reyes, Baylor University Linda Ridlon, Center for Quality of Management, Division of GOAL/QPC Kim Roberts, Athens State University David Schmitz, Milwaukee School of Engineering Sheryl R. Schoenacher, SUNY Farmingdale State College Jan Sepate, Kimberly Clark Patrick Sepate, Summitqwest Inc. Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xxviii Preface William R. Sherrard, San Diego State University Brian M. Smith, Eastern University Kimberlee D. Snyder, Winona State University Tony Taylor, MidAmerica Nazarene University Rachana Thariani, Atos-Origin Jayashree Venkatraman, Microsoft Corporation Dawn Tolonen, Xavier University Nathan Washington, Southwest Tennessee Community College Nate Tucker, Lee University Guy Turner, Castellini Company Scott Wright, University of Wisconsin– Platteville And we especially want to thank our family members for their love and support: Bet, Nick, Jill, Andy, Cadence, and Ellie —Timothy J. Kloppenborg Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. About the Authors Timothy J. Kloppenborg is an Emeritus Professor of Management at Williams College of Business, Xavier University. He previously held faculty positions at University of North Carolina Charlotte and Air Force Institute of Technology and has worked temporarily at Southern Cross University and Tecnológico de Monterrey. He has authored over 100 publications, including 10 books, such as Strategic Leadership of Portfolio and Project Management, Project Leadership, and Managing Project Quality. His articles have appeared in MIT Sloan Management Review, Project Management Journal, Journal of Management Education, Journal of General Management, SAM Advanced Management Journal, Information Systems Education Journal, Journal of Managerial Issues, Quality Progress, Management Research News, and Journal of Small Business Strategy. In his capacity as the founding collection editor of portfolio and project management books for Business Expert Press, he has edited 14 books with more in the pipeline. Tim has been active with the Project Management Institute for over 30 years and a PMP since 1991. He is a retired U.S. Air Force Reserve officer who served in transportation, procurement, and quality assurance. Dr. Kloppenborg has worked with over 150 volunteer organizations, many directly and others through supervising student projects. He has hands-on and consulting project management experience on six continents in construction, information systems, research and development, and quality improvement projects with organizations such Duke Energy, Ernst and Young LLP, Greater Cincinnati Water Works, Kroger, Procter & Gamble, TriHealth, and Texas Children’s Hospital. Dr. Kloppenborg has developed and delivered innovative corporate training, undergraduate, MBA, and Executive MBA classes in project management, leadership, teamwork, and quality improvement and he teaches PMP Prep classes. He holds a BS in business administration from Benedictine College, an MBA from Western Illinois University, and a PhD in Operations Management from University of Cincinnati. ® Dr. Vittal Anantatmula is a professor in the College of Business, Western Carolina University and a campus of University of North Carolina. He is also the Director of Graduate Programs in Project Management and was a recipient of excellence in teaching and research awards. Dr. Anantatmula is a Global Guest Professor at Keio University, Yokohama, Japan. He is a director and board member of the Project Management Institute Global Accreditation Center (PMI-GAC). He serves on the editorial board of several scholarly journals. At Western Carolina University, he was recognized with the University Scholar Award in 2017. He has won several other awards for excellence in both research and teaching. Prior to joining Western Carolina University, he taught at The George Washington University. He worked in the petroleum and power industries for several years as an electrical engineer and project manager and as a consultant in several international organizations, including the World Bank. Dr. Anantatmula has authored more than 60 publications, five books, and about 50 conference papers. Two of his conference papers received the best paper award. His work has been published in scholarly journals, including Project Management Journal, Journal of Knowledge Management, Journal of Management in Engineering, Journal of Information and Knowledge Management Systems, and xxix Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. xxx About the Authors Engineering Management Journal. He received his PhD from The George Washington University and is a certified project management professional. Kathryn N. Wells holds a master’s degree in Education, as well as degrees in Organizational Communication and Spanish. Kate has a passion for teaching, in both academic and corporate settings. In addition to over a decade’s experience in project management education, Kate is a top-producing real estate agent with Keller Williams. Her blend of experience in real estate—including working with many investors—and classroom teaching gives her a unique perspective and insights into many components of project management, including Planning, Communication, Stakeholder Management, and Project Control. In addition to her work on Contemporary Project Management, Kate is the lead author of Project Management Essentials (2015) and co-author of Project Management for Archaeology (2017), both published by Business Expert Press. She has trained and consulted with several organizations around the world and has occasionally been contracted to provide translations of project management educational materials (Spanish to English). Some of her clients include the University of Cincinnati, Children’s Hospital of Cincinnati, Givaudan International, and Tec de Monterrey University—where Kate has repeatedly served as visiting faculty at multiple campuses in Mexico. Kate is a certified project management professional (PMP). Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. PA RT 1 ORGANIZING PROJECTS ORGANIZE Chapter 1 Introduction to Project Management Chapter 2 Project Selection and Prioritization Chapter 3 Chartering Projects LEAD PLAN PERFORM Organizing for success in project management includes several basic frameworks for understanding projects and tools to select, prioritize, resource, and initiate projects. Basic frameworks described in Chapter 1 include how the work of project management can be categorized by knowledge area and process group, how project success is determined, and how both plan-driven and adaptive approaches are frequently used. Chapter 2 describes how projects are investments meant to help achieve organizational goals. Tools are demonstrated to select, prioritize, and resource projects. Chapter 3 describes how charters are essential to initiating projects and then demonstrates how to construct each portion of a charter. 1 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. CHAPTER 1 Introduction to Project Management CHAPTER OBJECTIVES After completing this chapter, you should be able to: Define a project and project management in your own words, using characteristics that are common to most projects, and describe reasons why more organizations are using project management. Describe major activities and deliverables at each project life cycle stage. List and define the ten knowledge areas and five process groups of the project management body of knowledge (PMBOK ®). Delineate measures of project success and failure, and reasons for both. Contrast predictive or plan-driven and adaptive or changedriven project life cycle approaches. BEHAVIORAL OBJECTIVES: Identify project roles and distinguish key responsibilities for project team members. Describe the importance of collaborative effort during the project life cycle. frantic00/Shutterstock.com CORE OBJECTIVES: I have returned from a successful climb of Mount Aconcagua in Argentina; at 22,841 feet, it is the highest peak in the world outside of the Himalayas. While there, seven other climbers died; we not only survived, but our experience was so positive that we have partnered to climb together again. During the three decades that I ve been climbing mountains, I ve also been managing projects. An element has emerged as essential for success in both of these activities: the element of discipline. By discipline, I am referring to doing what I already know needs to be done. Without this attribute, even the most knowledgeable and experienced will have difficulty avoiding failure. The deaths on Aconcagua are an extreme example of the consequences associated with a lack of discipline. The unfortunate climbers, who knew that the predicted storms would produce very hazardous conditions, decided to attempt the summit instead of waiting. They did not have the discipline that we demonstrated to act on our earlier decision to curtail summit attempts after the agreed-to turnaround time or in severe weather. 2 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. PMBOK ® 6E COVERAGE PMBOK ® 6E OUTPUTS 1.2 Foundational Elements Project Customer Trade-off Matrix Project Success Definition 2.4 Organizational Systems 3.3 The Project Manager s Sphere of Influence 3.4 Project Manager Competencies 3.5 Performing Integration PMBOK® GUIDE Topics: Project management introduction Project life cycle Stakeholders Project management process Project integration management CHAPTER OUTPUTS Customer Trade-off Matrix Project Success Definition I ve experienced similar circumstances in project management. Often I have found myself under pressure to cast aside or shortcut project management practices that I have come to rely on. For me, these practices have become the pillars of my own project management discipline. One of these pillars, planning, seems to be particularly susceptible to challenge. Managing projects at the Central Intelligence Agency for three decades, I adjusted to the annual cycle for obtaining funding. This cycle occasionally involved being given relatively short notice near the end of the year that funds unspent by some other department were up for grabs to whoever could quickly make a convincing business case. While some may interpret this as a circumstance requiring shortcutting the necessary amount of planning in order to capture some of the briefly available funds, I understood that my discipline required me to find a way to do the needed planning and to act quickly. I understood that to do otherwise would likely propel me toward becoming one of the two-thirds of the projects identified by the Standish Group in their 2009 CHAOS report as not successful. I understood that the top 2 percent of project managers, referred to as Alpha Project Managers in a 2006 book of the same name, spend twice as much time planning as the other 98 percent of project managers. The approach that I took allowed me to maintain the discipline for my planning pillar. I preplanned a couple of projects and had them ready at the end of the year to be submitted should a momentary funding opportunity arise. A key to success in project management, as well as in mountain climbing, is to identify the pillars that will be practiced with discipline. This book offers an excellent set of project management methods from which we can identify those pillars that we will decide to practice with the required levels of discipline. I believe that project management is about applying common sense with uncommon discipline. Michael O Brochta, PMP, founder of Zozer Inc. and previously senior project manager at the Central Intelligence Agency 1-1 What Is a Project? Frequently, a business is faced with making a change, such as improving an existing work process, constructing a building, installing a new computer system, merging with another company, moving to a new location, developing a new product, entering a new market, and so on. These changes are best planned and managed as projects. Often, these changes are initiated due to operational necessity or to meet strategic goals, such as the following: Market demand Customer request 3 Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. 4 Part 1 Organizing Projects Technological advance Legal requirements or regulatory compliance Replace obsolete equipment, technology, system, or physical facility Crisis situation Social need So, what is a project? A project is a new, time-bound effort that has a definite beginning and a definite ending with several related and/or interdependent tasks to create a unique product or service. The word temporary is used to denote project duration; however, it does not mean that project duration is short; in fact, it can range from a few weeks to several years. Temporary also does not apply to the project deliverable, although project teams are certainly temporary. A project requires an organized set of work efforts that are planned with a level of detail that is progressively elaborated on as more information is discovered. Projects are subject to limitations of time and resources such as money and people. Projects should follow a planned and organized approach with a defined beginning and ending. Project plans and goals become more specific as early work is completed. The project output often is a collection of a primary deliverable along with supporting deliverables such as a house as the primary deliverable and warrantees and instructions for use as supporting deliverables. Taking all these issues into consideration, a project can be defined as a time-bound effort constrained by performance specifications, resources, and budget to create a unique product or service. Each project typically has a unique combination of stakeholders. Stakeholders are people and groups who can impact the project or might be impacted by either the work or results of the project. Projects often require a variety of people to work together for a limited time, and all participants need to understand that completing the project will require effort in addition to their other assigned work. These people become members of the project team and usually represent diverse functions and disciplines. Project management is the art and science of using knowledge, skills, tools, and techniques efficiently and effectively to meet stakeholder needs and expectations. This includes work processes that initiate, plan, execute, control, and close work. During these processes, trade-offs must be made among the following factors: Scope (size and features) Quality (acceptability of the results) Cost Schedule Resources Risks When project managers successfully make these trade-offs, the project results meet the agreed-upon requirements, are useful to the customers, and promote the organization. Project management includes both administrative tasks for planning, documenting, and controlling work and leadership tasks for visioning, motivating, and promoting work associates. The underlying principle of project management discipline is to make effective and efficient use of all resources and it is this principle that influences some of these trade-off decisions. Project management knowledge, skills, and methods can be applied and modified for most projects regardless of size or application. Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Chapter 1 Introduction to Project Management 5 1-2 History of Project Management Projects of all sizes have been undertaken throughout history. Early construction projects included the ancient pyramids, medieval cathedrals, Indian cities, and Native American pueblos. Other large early projects involved waging wars and building empires. In the development of the United States, projects included laying railroads, developing farms, and building cities. Many smaller projects consisted of building houses and starting businesses. Projects were conducted throughout most of the world s history, but there was very little documentation. Therefore, there is no evidence of systematic planning and control. It is known that some early projects were accomplished at great human and financial cost and that others took exceedingly long periods of time to complete. For example, the Panama Canal was started in 1881 and completed in 1914. Project management eventually emerged as a formal discipline to be studied and practiced. In the 1950s and 1960s, techniques for planning and controlling schedules and costs were developed, primarily on huge aerospace and construction projects. During this time, project management was primarily involved in determining project schedules based on understanding the order in which work activities had to be completed. Many large manufacturing, research and development, government, and construction projects used and refined management techniques. In the 1980s and 1990s, several software companies offered ever more powerful and easier ways to plan and control project costs and schedules. Risk management techniques that were originally developed on complex projects have increasingly been applied in a simplified form to less complex projects. In the last few years, people have realized more and more that communication and leadership play major roles in project success. Rapid growth and changes in the information technology and telecommunications industries especially have fueled massive growth in the use of project management in the 1990s and early 2000s. Simultaneously, systems and processes were developed for electronic documentation of the historical data of projects using information systems (IS) and knowledge management tools. People who are engaged in a wide variety of industries, including banking, insurance, retailing, hospital administration, healthcare, and many other service industries, are now turning to project management to help them plan and manage efforts to meet their unique demands. Project planning and management techniques that were originally developed for large, complex projects can be modified and used to better plan and manage even smaller projects. Now, project management is commonly used on projects of many sizes and types in a wide variety of manufacturing, government, service, and nonprofit organizations. Further, in today s global economy, geographically dispersed virtual project teams are becoming a familiar entity in many organizations. Managing a project is challenging in the current global economy due to the exponential growth of information technology and ever-increasing market demand that organizations offer products and services efficiently and quickly. Understanding the characteristics of global projects for improving global project performance is of critical importance. The use of project management has grown quite rapidly and is likely to continue growing. With increased international competition and a borderless global economy, customers want their products and services developed and delivered better, faster, and cheaper. Because project management techniques are designed to manage scope, quality, cost, and schedule, they are ideally suited to this purpose. Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. 6 Part 1 Organizing Projects AGILE Throughout this book, we will present concepts and techniques that are either unique to Agile projects or are emphasized more on Agile projects. Many of these ideas can be used to improve practice on traditional projects. In 2001, a group of thought leaders became frustrated with the use of traditional, plan-driven project management for software projects and as a result, they wrote a document called The Agile Manifesto.1 The four core values of Agile as shown below are completely consistent with our approach to Contemporary Project Management. Agile will be defined in Chapter 3, but throughout the book, a margin icon will indicate ideas from Agile, and the text will be in color. Value Value Value Value individuals more than processes. working software more than documentation. customer collaboration more than negotiation. response to change over following a plan. 1-3 How Can Project Work Be Described? Project work can be described in the following ways: Projects are temporary and unique, while other work, commonly called operations, is more continuous. Project managers need certain soft skills and hard skills to be effective. Project m...
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