Effective Project Management
Description
Effective Project Management is based around an activities and action check list approach to project management. It provides a guide to the basic principles and the disciplines that managers need to master in order to be successful. The author's check lists approach (based on his years of practical experience on projects) ensure that project managers are following valid processes, helping them to be innovative in their approach to developing plans and resolving problems. In addition, the author's check list pick and mix format is designed to be flexible in order to meet the individual needs of the reader.
Effective Project Management also contains some information on the theories underpinning project management. Knowledge of the theory helps in the understanding of how project management works in practice. In addition to the book's check lists of what activities need to be performed, the author offers suggestions on how tasks could be carried out.
This important resource:
* Covers a wide range of project management topics including the project management process, programme and portfolio management, initiating and contracting a project, personal skills and more
* Offers a highly accessible guide to the author's verified check list approach
* Presents flexible guidelines applicable for a wide range projects
* Includes guidance for project managers at all levels of experience
Written for project managers working on engineering or construction projects, Effective Project Management reviews all aspects of a project from initiation and execution to project completion together with the specialist topics and personal skills needed to manage projects effectively.
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GARTH G.F. WARD manages the project management consultancy and training business Ritchie Ward Associates. For sixteen years he lectured at Cranfield School of Management and for ten years was Director of the Masters Course in Project Management. In addition, Garth has over twenty years of experience as a project manager in both client and contracting organizations, including Shell-Mex and BP, Bechtel, Kellogg and Chemico.
Content
Preface xix
Acknowledgements xxi
Introduction 1
Part I Projects and Their Management 5
Section A Project Characteristics and Phases 6
1 Characteristics 7
2 Phases 8
3 Project Patterns 11
4 Reasons for Projects 12
5 Project Needs 12
Section B Project Management Characteristics 14
1 Models 16
2 Characteristics 18
3 Key Management Decisions and Phases 20
4 Project Management Patterns 24
Section C Execution Planning Influences 26
1 Project Characteristics, Size, and Complexity 26
2 Strategic Decisions 27
3 The Historic Nature of an Industry 30
4 The Characteristics of the Industry/Business Sector 31
5 Phases and Schedule 41
6 Execution Planning 41
7 Generic Influences on Project Execution 42
Section D The Project Management Role 43
1 Strategic and Contractual 43
2 Organizational and Functions 43
3 Responsibilities and Orientation 46
4 Competencies and Leadership 47
5 Abilities and Skills 48
6 The Project Manager 50
Section E The Manager of Projects 52
1 Financial Situation 52
2 Scope of Work and Change Orders 54
3 Project Progress and Status 54
4 Health, Safety, and Environment 56
5 Quality Audits and Status 56
6 Risk Management 56
7 Client Relations 56
8 Formal Reviews 56
9 The Project Management Group 57
10 Evaluating a Project Manager 57
11 The Manager of Projects and the Client(s) 58
Section F The Owner and Client 59
1 Some Fundamentals 59
2 Cost and Planning 61
3 Things to Watch 61
4 Most Important of All - Safety 62
Section G Achieving Success 63
1 The Project Management 66
2 Alignment of Objectives and Client-Contractor Relations 67
3 Involvement of Users 68
4 Get and Build the Right Team with Clear Roles and Responsibilities 70
5 Clear and Complete Scope Definition 70
6 Thorough Planning of the Work 71
7 Planning Communications 72
8 The Efficiency of the Project Launch Phase 73
9 Change Control 74
10 Effective Decision Making 74
11 Tackle Things Today - Tomorrow They Will Be Bigger 75
12 Conclusions for Success 75
Part II Programme Management 77
Section A Programme Management - What's in A Name? 78
1 Programme Management Conclusions 79
2 Summarizing Programme Management 80
3 Key Roles for a Programme Manager 81
Section B Business Change Programmes 82
1 Blueprint 82
2 Programme Organization 82
3 Change Stakeholders 83
4 Benefits Realization 83
5 Gate Reviews 84
6 Project Controls 84
7 Terminating the Programme 85
Section C Management of Portfolios 86
Part III Feasibility and Contracting 89
Section A Feasibility Studies 90
1 Feasibility Study Plan 91
2 Defining the Project 92
3 The Feasibility Report 92
4 Proposed Execution Plan 94
5 The Next Step 95
Section B Contracting Strategy Considerations 96
1 Business Strategy and Stakeholder Alignment 96
2 Regional and Local Factors 96
3 Market Intelligence 97
4 Prequalification Processes 97
5 General Contracting Issues 98
Section C Issuing an Enquiry 103
1 Enquiry Preparation Phase 103
2 Tendering Phase 106
3 Evaluation Phase 106
Section D To Tender or Not to Tender 109
1 The Tendering Decision 109
2 The Tender Decision Analysis 110
3 The Final Tendering Decision 113
Section E Tendering and Proposal Phase 115
1 Tendering Preliminaries 115
2 Developing the Tender or Proposal - In-house Work 117
3 Coordinating with Third Parties 121
4 Coordinating with the Client 121
5 Commercial 122
6 Reviewing the Tender or Proposal 124
7 Before Submitting the Tender or Proposal 125
8 After Completion of the Tender or Proposal 125
9 Proposal Team Presentation 126
10 Possible Client Questions for the Proposal Team 129
Section F Contracts 131
1 Starting Work 133
2 Awarding Contracts 134
3 Contract Document 134
4 Contract Awarded 136
5 Contractual Issues 137
6 Some Contractual Reminders 138
7 Discharge of a Contract 138
Part IV Project Execution 139
Section A Project Launch 140
1 Project Checks 142
2 Project Objectives 143
3 Scope Launch 144
4 Team Launch 144
5 Execution Launch 145
6 Launch Controls 145
7 Hold Kick-Off Meeting 146
8 Kick-Off Meeting Agenda 146
9 Kick-Off Schedule 148
Section B Establishing An Office 150
Section C Getting Organized 152
1 Setting up the Project Infrastructure 152
2 Controlling the Documents 154
3 Responsibilities 155
4 Procedures 156
5 Project Execution Plan 156
6 Formalities 157
7 Project Insurance 157
8 Some Advice 158
Section D Mobilization 159
Section E Client Relations 161
Section F Scope 163
1 Scope Documents 164
2 Changes to the Scope 164
3 Work Packaging 164
Section G Estimates and Budget 166
1 Establishing the Estimate(s) 167
2 Trend Programme 167
3 Allowances 168
4 The Budget 168
Section H Accounting 170
1 Looking after the Finances 170
2 Bonds 172
Section J Planning and Scheduling 173
1 Getting Organized 173
2 Planning 173
3 Scheduling 174
Section K Project Controls 176
1 Setting Up 177
2 Progress and Reporting 178
3 Cost Progress and Control 179
4 The Critical Path 179
Section L Variations/Changes/Claims 181
1 Trend Base Estimate 182
2 Trend Meetings 183
3 Potential Trends 184
4 Claims for Changes 184
5 Managing Claims 186
6 Resist Change 187
Section M Reporting 188
1 Reporting Cycle 188
2 Visibility 189
3 Progress Reporting 190
4 Progress Report 191
5 Cost Reporting 192
Section N Project Meetings 193
Section O Design 195
1 Getting Organized 195
2 Reviewing the Design 196
3 Some Specific Design Ideas 198
4 Construction Issues 198
Section P Procurement 200
1 Getting Organized 200
2 Evaluating Suppliers 201
3 Expediting and Inspection 202
4 Some Specific Procurement Ideas 202
5 Payment Terms 204
Section Q Installation and Construction 205
1 The Key Staff 205
2 Construction Planning 207
3 Work Packaging 210
4 Construction Site Work 210
5 Some Specific Construction Ideas 213
6 Establishing Authority 214
Section R Subcontracting 215
1 Questions to Ask Before Subcontracting 215
2 Contracting Checks 216
3 Management Issues 217
4 List of Some Subcontracts 217
Section S Commissioning and Setting To Work 219
Section T Contract Completion - Close Out 222
1 Handover of Documentation 222
2 Handover of Equipment 223
3 Clean Up 223
4 Disposal of Surplus Material 223
5 Closing Contracts 224
6 Financial Matters 225
7 Close Out 225
Section U Post Project Activities 227
1 Completing the Records 227
2 Post-project Appraisal - Internal Performance Review 227
3 Project/Client Review Meeting/Lessons Learned 228
4 Historical Report 230
5 Client Follow-up and Marketing 230
6 Internal Projects Benefits 231
Part V Specialist Topics 233
Section A Completed and Inspected Work 234
1 Completed Work 234
2 Inspecting Work 236
Section B Coordination Procedure 238
1 Basic Organizing Information 238
2 Coordination with the Company 239
Section C Cultural Issues 243
1 Some Definitions of Culture 243
2 A Seminal Grouping of Cultures 244
3 Some Cultural Issues to be Aware of 244
4 Management Style 246
Section D Documentation 247
1 Contractor's Own Documents and Drawings 247
2 Vendor Drawings and Documents 249
Section E Estimating and Contingency 250
1 Types of Estimate 250
2 Estimate Planning Sequence 252
3 The Estimating Process 253
4 Estimate Information and Content 255
5 Contingency Estimation 259
Section F Filing and Archiving 261
1 The Filing System 261
2 Archiving 263
3 Master File Index: Recommended Minor Categories and Suggested Subjects 264
Section G Financial Appraisal 270
1 Cash versus Profit 270
2 Simple Project Appraisal Methods 272
3 Payback 273
4 Discounted Cash Flow Techniques 273
5 Internal Rate of Return - IRR 276
6 Sensitivity and Risk Analysis 277
7 Financial Appraisal Conclusion 277
Section H Incoterms® 280
1 Rules for Any Mode or Modes of Transport 280
2 Rules for Sea and Inland Waterway Transport 281
3 Transfer of Risks and Obligations 281
4 Sellers' and Buyers' Detailed Obligations 282
5 Additional Information 282
Section J Joint Associations 283
1 Reasons for Joint Association 283
2 Documentation and Legal Requirements 284
3 Selecting a Partner 284
4 Joint Association Risks 285
5 Steps to Evaluate Joint Associations 285
6 Key Issues for a Joint Association 287
7 Steps in Tendering 288
8 Control of the Work 289
9 Financial Control 289
10 Essentials for Success 290
11 Why Joint Associations Fail 290
Section K Performance Appraisals 292
1 Purpose and Preparation 292
2 The Interview 292
3 Post-interview Actions 293
Section L Performance Measurement and Earned Value 295
1 Design/Engineering Performance 295
2 Procurement Performance 297
3 Construction Performance 297
4 Practical Performance Details 298
5 Linking Deliverables to Programme 299
6 Recording and Comparing Data 300
7 Earned Value Terminology 302
8 Useful Health Ratios or Indices 302
Section M Risk and Risk List 303
1 Process Model 304
2 Prioritising Risk 306
3 Risk List 309
4 People and Risk 312
5 Country Risk Assessment 313
Section N 'S' Curves 315
1 Interpreting the Curves 315
2 Change Orders 319
Section O Site Checks 323
1 Country Data 323
2 Site Data 323
3 Local Authorities 323
4 Suppliers and Local Contractors 323
5 Labour Availability 324
6 Non-manual Employees 324
7 Housing and Camp 324
8 Shipping and Handling 325
Section P Surety Bonds 326
1 Types of Bonds 326
2 Characteristics of Bonds 328
Section Q Selecting and Building the Team 329
1 Selecting the Team 329
2 Building the Team 332
3 New to the Team 336
Section R Team Roles 337
1 Specification of the Eight Team Roles 337
2 A Suggestion for a Project Manager 341
3 Matching the Roles to the Project Process 342
Section S Value Management/Engineering 343
1 VM/VE Process 343
2 Group Process 346
Part VI Skills Check Lists 349
Section A Communications 350
1 Correspondence 351
2 Documents 353
3 ElectronicMedia 354
4 Oral 357
5 Social 358
6 Visual 359
7 Other Communication Tools 359
8 Translators 359
9 A Difficulty 360
10 Some Reminders 361
Section B Leadership and Motivation 362
1 Consensus to Dictatorial Continuum by Tannenbaum and Schmidt 363
2 The Three S's of Group Communications 364
3 Situational Leadership by Kenneth Blanchard and Dr. Paul Hersey 365
4 Task, Team, Individual - Action Centred Leadership by John Adair 367
5 Leadership and Management Roles 368
6 Management by Walking/Wandering Around MBWA 369
7 Responsibility 369
8 Leadership - More Than a Management Model 370
9 Thoughts for the Day 371
Section C Managing and Conducting Meetings 373
1 Planning the Meeting 373
2 The Agenda 374
3 Manage the Process and the People 375
4 Control the Discussion 377
5 Construct Decisions and Summarize 378
6 Record and Notify 379
Section D Negotiation 381
1 Preparation for Negotiation 381
2 Discuss Interests 382
3 Signal 382
4 Propose for Movement 383
5 Package 383
6 Bargain 383
7 Close the Deal 383
8 Agree the Deal 383
9 Techniques and Tricks 384
Section E Personal Skills 386
1 Planning an Interaction with Others 386
2 The Exchange 387
3 Asking Questions 388
4 Changing Style 388
5 Team Role Style 390
6 Finalizing the Interaction 391
7 Giving and Receiving Feedback 391
8 Dealing with Difficult People 392
9 Being Angry 394
10 Priorities 395
11 Time Management 395
12 Learning 396
13 Motivating Skills 397
14 Some Personal Advice 397
15 Questionnaires 398
Section F Politics in Projects 399
1 Typical Destructive Behaviour 400
2 Dubious Behaviour? 401
3 How Politics Can Affect a Project 402
4 Some Advice 403
5 Something to Think About 405
Section G Presentation Skills 406
1 Fundamentals for All Presentations 406
2 Format for a Presentation to Inform/Explain 408
3 Presentation to Influence/Convince 409
4 Presentation Expressing a Viewpoint/Opinion 410
5 Team Presentations 410
6 Your Audience 411
7 Presentation Skills Analysis 412
8 Organizing the Location 413
9 Visual and Other Aids 415
10 Dealing with Questions 416
11 Summarizing a Presentation 417
Section H Prioritising Techniques 418
1 Group Work Using Flip Charts 418
2 Graphical Plots 418
3 Binary Decision-making 420
Section J Problem-solving Process 422
1 Define the Problem 423
2 Define the Objectives and Success Criteria 423
3 Analyse the Problem 423
4 Create and Propose Solutions 424
5 Evaluate, Forecast Consequences, and Select 424
6 Recommend, Plan Action, and Implement the Solution 425
7 Evaluate the Outcome and Follow Up 426
Section K Problem-solving Techniques 427
1 Brainstorming 427
2 Check Sheets 428
3 Pareto and Other Diagrams 429
4 Cause and Effect - Ishikawa or Fish Bone Diagram 430
5 Force Field Analysis 430
Section L Report Writing 433
1 The Report Objective 433
2 The Reader 433
3 The Material for the Report 434
4 The Report Structure 435
5 The Executive Summary 435
6 Introduction to the Report 435
7 The Body of the Report 436
8 Writing the Report 436
9 Conclusions and Recommendations 438
10 Appendices 439
11 Finalizing the Report 439
Abbreviations 441
Index 447
Section A
Project Characteristics and Phases1
Projects can be anything: a capital facility, an information system, a piece of research, a company merger, an organizational change, launching a product, or decommissioning a facility, and so on. They can range from capital intensive technological and infrastructure investments to labour-intensive health care. All projects types need a description, a scope, and the associated specifications for the quality required, and they cannot be realized without a team of people to develop them. The fundamental characteristic of all projects is that they create and cause change. As such, they come up against resistance. Consequently, leadership is needed in the form of a project manager, and a project management process is required to control them. (See Section B.)
There is a hierarchy to projects determined by their size, complexity, and the inherent risks (see Figure I.A.1). At the lowest hierarchical level are the routines, tasks that are so common and so well developed in a function that methods of working have ironed out all the difficulties. Next in the hierarchy are those frequently occurring packages of work - small projects that are very similar and can be developed without too much specialized management and theoretically do not present any significant risks. There are lots of them in an organization and they can be performed without any real difficulty. These are called the runners.
Figure I.A.1At the next level of the hierarchy are larger projects that the organization performs reasonably regularly; they are very similar or replicate previous projects. Naturally, they are called repeaters. The development of repeaters has become more specialized, less routine, and more individually project-focused. As a consequence they have a higher risk of failure. They need someone experienced in project management because the real risk with them is that people assume they are repeats. The reality is that they have differences that, if ignored, could cause project failure. Then come the projects that are infrequent and more unusual, they become strangers to an organizations normal method of working. They are large projects and are high risk projects as far as the organization is concerned. As a consequence, they need someone to manage them, who is skilled and experienced in project management. Finally, the mega project, the first of a kind, the once-in-a-career opportunity are the aliens, consisting of a programme of large projects. (Part II addresses programme management).
'Every project begins on paper as an ideal, as a vision of perfection and quickly becomes mired in the confusion of budget, size and opposition of NIMBY's'.2 Consequently, the best way to start a project is to carry out a feasibility study that results in a clear brief and statement of the requirements (see Part III). Nevertheless, there are features that are common to all projects regardless of size.
1 Characteristics
1.1 Unique Non-repetitive
A primary characteristic of projects: a product, a development, a task, or a deliverable is that they are unique and are non-repetitive.
1.2 Phases
Secondly, because projects start with a unique idea or concept, they go through a series of growth phases in order to achieve an outcome.
1.3 Risk
Projects are risky due to the very uniqueness of their nature. The risks are then compounded by the changes that can occur during the project's development. The severity, impact and consequences of the risks incurred are related to the hierarchical position of the project, as described above.
1.4 Business Objectives
Projects come into being because they will provide benefits to an owner and a return on their investment; they have a purpose. The business requirements of a project become the owner's objectives. They then get translated into specific objectives for the management of the project (see Section B).
1.5 Liable to Changes
Projects almost invariably change in scope, often by very large factors, due to changing business requirements and market conditions.
It is typically necessary to reduce the costs involved in order to make the project financially viable and to make the business case acceptable. This will usually mean reducing the scope or specification of the project - see Figure I.A.2. Everyone creating a project has big ideas, but when the budget can't get any bigger, the ideas have to get smaller.
Figure I.A.21.5.1
Clients may have limited funds and reduce the budget, but they do not reduce their ambition. In reality, there is no such being as a client who does not make changes. Thus, once the project is approved and has got the go-ahead, there is a natural tendency to want to put back all the features that were removed. These changes are then likely to cause failure of the business objectives. Sometimes it can be almost impossible to match the requirements with the money that has been allocated to a project. This often occurs in the public sector. The correct approach is to deliver the essentials and, if there is anything left in the budget, add the 'nice to haves' when the essentials have been completed.
2 Phases
2.1
The development of a project is modelled by a series of phases or stages. Sometimes the phases they go through are carried out sequentially, but more often they overlap significantly. There are three basic project stages:
2.1.1
The conceptual, creative, thinking phase is a natural process; people enjoy it. The same is true of doing. People like to design, make, and construct - doing is also a natural process. This is not true of planning. Planning is not a natural process. It is imposed on a project's development by the management process. The trouble is that people's natural desire is to jump straight from the thinking stage to the doing stage. If this occurs, project disaster is guaranteed. It is not a flaw in the characteristics of projects; it is a failure in a project's management.
2.1.2
For more complex situations, these basic phases are broken down into more detail. Between each phase, there is an opportunity to assess the viability of the project and decide if one wishes to proceed to the next phase. The objective of breaking the project into phases is to enable one to plan and control the work at the appropriate level of detail.
2.2 Phase Details
The following Figure I.A.3 is a basic model of a typical project, showing the state of development for each phase of the project. These phases are typical for technological projects such as the process and power industries3 , but it is also intended to be generic:
- Concept: a company, government, or some other body determines that there is a requirement for a new facility, plant, or product.
- Feasibility: the concept is examined in detail to see whether it is a realistic, viable business proposition. This selection and definition phase is one of value creation.
- Planning: if it is viable, an execution plan is developed.
- Basic design: before major funds are committed, the basis of design is carefully agreed.
- Design: once the basic 'recipe' is firm, detailed drawings for each element or component are produced.
- Procurement: all the necessary services, materials, and equipment are purchased.
- Construction or production: the facility or product is assembled from the materials and equipment, using the drawings already prepared.
- Commissioning or setting to work: the plant or product is thoroughly tested to ensure that it satisfies the requirements of the project.
2.2.1
Figure I.A.4 shows the different terminology and phase definitions used in different business environments:
- Line 1 is a generic model for technological industries - process and power.
- Line 2 is the owner/client perspective of line 1.
- Line 3 is an architect-driven building project.
- Line 4 represents product development.
- Line 5 represents information technology.
- Line 6 represents manaufacturing.
- Line 7 represents The Civil Service 'Policy' project life cycle.
- Line 8 represents the Ministry of Defence smart acquisition process.
2.3 Purchasing and Contracting Phases
There are three positions in the development of the phases where the owner may contract with someone else to perform the work in subsequent phases:
- At the end of the conceptual study and start of the feasibility study
- Prior to the development of the basic design and planning stage
- Prior to the execution phases of the project
The purchasing options available to the owner mean that the stages in Figures I.B.3 or I.B.4 involved in the contracting process have to be integrated into phases shown in Figure I.A.4.
3 Project Patterns
There are important patterns that depend on the phases of the project and give a clearer understanding of the way a project develops.
