lecture 1 understanding project

8/8/2019 Lecture 1 Understanding Project

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Understanding Project and

International ContextProject Management: A Managerial Approach (4/e)

By Jack R. Meredith and Samuel J. Mantel, Jr.

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Projects in Contemporary Organizations

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` Project Management has emerged because the

characteristics of our turn-of-the-century society

demands the development of new methods of

management

` Many forces have fostered the emergence and

expansion of Project Management


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Forces Of Project Management

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` Three Paramount Forces driving ProjectManagement:1. The exponential expansion of human knowledge

2. The growing demand for a broad range of complex,sophisticated, customized goods and services

3. The evolution of worldwide competitive markets for theproduction and consumption of goods and services

` All 3 forces combine to mandate the use of teams

to solve problems that used to be solvable byindividuals


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Objectives of a Project

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` Three Project Objectives:

` Performance

` Time

` Cost

` Expectations of clients are not an additional target, but an

inherent part of the project specifications


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Objectives of a Project

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The Professionalism of Project Management

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` Complexity of problems facing the project manager

` Growth in number of project oriented organizations

` The Project Management Institute (PMI) was established in 1969

` By 1990 it had 7,500 members

` 5 years later, over 17,000 members

` And by 1998, it had exploded to over 44,000 members

` This exponential growth is indicative of the rapid growth in

the use of projects` Also reflects the importance of PMI as a force in the

development of project management as a profession


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Project Management Institute

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Recent Changes in Managing Organizations

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` The process of managing organizations has beenimpacted by three revolutionary changes

1. Accelerating replacement of traditional,hierarchical management by participatorymanagement

2. Currently witnessing the adoption of the systemsapproach (sometimes called systemsengineering)

3. Organizations establishing projects as thepreferred way to accomplish the many specific

changes that must be made when the organizationattempts to alter its strategy


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The Definition of a Project

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` Must make a distinction between terms:` Program - an exceptionally large, long-range objective

that is broken down into a set of projects

` Task - set of activities comprising a project

` Work Packages - division of tasks` Work Units - division of work packages

` In the broadest sense, a project is a specific,

finite task to be accomplished


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Characteristics of a Project

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` Have a purpose

` Have a life cycle

` Interdependencies

` Uniqueness

` Conflict


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Why Project Management?

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` Companies have experienced:

` Better control

` Better customer relations

` Shorter development times` Lower costs

` Higher quality and reliability

` Higher profit margins

` Sharper orientation toward results

` Better interdepartmental coordination

` Higher worker morale


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Why Project Management?

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` Companies have also experienced some negatives:

` Greater organizational complexity

` Increased likelihood of organizational policy violations

` Higher costs

` More management difficulties

` Low personnel utilization


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The Project Life Cycle

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` Stages of a Conventional Project:

` Slow beginning

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Buildup of size` Peak

` Begin a decline

` Termination


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` Time distribution of project effort is characterized byslow-rapid-slow


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` Other projects also exist which do not follow the

conventional project life cycle

` These projects are comprised of subunits that have littleuse as a stand alone unit, yet become useful when put

together


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` Unlike the more conventional life cycle, continued inputs of effort atthe end of the project produce significant gains in returns


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` It is essential for the Project Manager to

understand the characteristics of the life cycle

curve for his project

` The distinction between the two life cycles plays

a critical role in the development of budgets and

schedules for the project


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` Risk during project life cycle

` With most projects there is some

uncertainty about the ability to meetproject goals

` Uncertainty of outcome is greatest at the

start of a project

` Uncertainty decreases as the projectmoves toward completion


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Projects in Contemporary Organizations

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Risk During Project Life Cycle

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` Uncertainty decreases as the project moves towardcompletion


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International Project Analysis

` Its normative analysis` Examines characteristics, relationships and actions that should

exist

` May not be empirically based

` Its objective is to maximize profit` Decision making is more amenable to modeling

` The rational model

` The bounded-rational model

` The political model

` The garbage can model

22 International Project Management


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Rational Model of Decision Making

` Decision maker search for all possible courses of action,to compare and to evaluate them and to choose the

optimal solution.

` Recognition

` Diagnosis` Search

` Design

` Evaluate

` Choice` Authorization

` implementation



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The Bounded-Rational Model

` Actual decisions are made in the real world withincomplete information, under time pressure and/or with

possible disagreement over goals

` The optimal solution may not always be achieved

rationality is bounded.



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The Bounded-Rational Model

1. It involves problematic search rather than completealertness

2. Cognitive limits exist in the search process

3. Time pressure often cut short the full search process

4. Incrementalism and disjointedness often occcur

5. Intuition and judgement often play important role

6. Satisficing rather than optimal solution



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Political Model

` The political model of decision making involves shiftingcoalitions of interests and temporary alliances of decision

makers who may, for the purpose of dealing with a

particular problem, come together and sufficiently forget

their differences in order to make a decision.` Bargaining

` Guile

` Coalition building

` biasing



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Garbage Can Model

` Events and decisions are not at all systematic andorganized anarchy.



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Eclectic paradigm

` The eclectic paradigm is a theory in economics and is alsoknown as the OLI-Modeling, by John H. Dunning

` The theory of internalization itself is based on the transactioncost theory.This theory says that transactions are made withinan institution if the transaction costs on the free market are

higher than the internal costs.This process is calledinternalization

` Ownership advantages: (trademark, production technique,entrepreneurial skills, returns to scale)[2]

` Locational advantages (existence of raw materials, low wages,special taxes or tariffs)

` Internalisation advantages (advantages by producing through apartnership arrangement such as licensing or a joint venture)

International Project Management29


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Globalization

International Project Management30

lecture 1 understanding project

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