An Overview of Project Management

Definition of Project:
 Any undertaking that has definite, final objectives
representing specified values to be used in the satisfaction
of some need or desire.
 A cluster of activities that is relatively separate and
clear-cut. A project typically has a distinct mission and
a clear termination point.
 In the broadest sense, a project is specific, finite task to be
accomplished.
Common Features:
• A desired outcome at the end
• Consume significant amount of resources – time and money.
• Have limitations on resources that are available
• Not undertaken frequently; successful completion is
essential
• Well-defined activities with a clear-cut start and end.
 A project is synthesizing predetermined amounts of the
resources of an organization to generate something that
will assist the organization in designing and executing its
strategies.
Key Considerations:
i. What is the cost?
ii. What is the time required?
iii. What are the capabilities that it provides to the
organization?
v. Whether it will fit into the strategies of the organization?
Types of Projects:
All projects do not involve the same level of managerial skills,
costs, technology, complexity, etc. On the basis of Shenhar
classification, projects can be grouped by taking the degree of
uncertainty and system complexity or scope. Degree of
uncertainty ranges from low to high. It is divided as Low-tech,
Medium-tech, High-tech, and Super-tech. Based on system
complexity, a project can be classified as Assembly project,
System project and Array project. Refer the following figure:

(Degree of Uncertainty)

Super High-tech Enterprise resource planning,

implementation in multi-national
organization

High-tech New shrink- Advanced radar

wrapped software

Medium-tech New cell phone

Low-tech Construction Auto repair

Projects

Assembly System projects Array projects

projects
(System Complexity/ scope)
Shenhar’s (2001) Classification
What is Project Management?
Managing a project is called project management.
According to Harold Kerzner, “ Project Management is the art of
creating the illusion that any outcome is the result of predetermined,
deliberate acts, when in fact, it is dumb luck.” While this is
tongue-in-cheek definition, it nevertheless reflects the
situation in many organizations pretty well.
More precisely, “ Project Management can be defined as
planning, organizing, staffing, directing and controlling some
parts of organization for a relatively short time of period of
time to achieve the project objectives within the laid down
constraints.”
Time, Cost and Performance: Hitting the bull’s eye on the three counts
is essential for the success of a project. Symbolically, the success or
otherwise of project management can be expressed as follows:
3 where, 1 to 3 = Time, cost and performance,
S = Σ Wi Ri Wi = Weight assigned to each factor
t=1 Ri = Degree of success in each factor
Why Project Management?
The decision on whether or not to set-up a separate project
management division is subjective, as some of the factors
that are considered should be on a case to case basis.
The factors to be considered are:
i) Interactions or interdependencies between various
departments,
iii) Sharing of common resources,
iv) The importance of the project to the organization,
v) Size of the project,
vi) Degree of unfamiliarity with the work involved and its
complexity,
viii)Changes in the market,
ix) The reputation of the organization,
Project management should be made use of keeping all
these factors in view and also the cost it entails.
Life Cycle of A Project:
The life of a project can be divided into phases. These
phases correspond with changes in the levels of activity or
effort put into the project and the uncertainty regarding the
final outcome of the project and are not just of academic
interest.
There are broadly four phases in the life of a project:
Phase I : Conception and Selection
Phase II : Planning and Scheduling
Phase III : Implementation, Monitoring and Control
Phase IV : Evaluation and Termination
Functions to be performed during the four phases:
Phase I i. Identifying a need for a project.
ii. Establishing goals to be achieved by the project.
iii. Estimating the amount that the firm will have to
commit for the project.
iii. Presenting the project idea/alternatives to the
management and get approval.
Phase II
i. Set-up a technical team to decide on how the
project can be implemented.
ii. Plan for the requirements of personnel, finance,
materials etc.
iii. Prepare a schedule keeping in view the date given
by the client or the management, and the required
buffer time to meet unexpected events or mishaps.
Phase III
i. Procuring materials
ii. Building and testing the tools
iii.Developing support systems
iv. Producing the system that is aimed at
v. Verifying whether its performance is up to the laid
down standard
vi. Making modification to either bring the performance
to the required level or to suit the changes suggested
by the client or management
Phase IV
i. Training operational staff
ii. Transfer of material
iii. Transferring the responsibilities
iv. Releasing surplus resources, that remain after use
v. Releasing the project staff for the next assignment
Effort Spent on a Project: The level of Effort increases
until phase III and then decreases

Phase III
Level of effort
Phase II

Phase IV

Phase I

Time
Project Overview Statement(POS):
It is referred to as Project Scope Statement. POS can be
divided into five parts:
i. Project Problem/Opportunity
ii. Project Goal
iii. Project Objectives
iv. Success Criteria
v. Assumptions, Risks, and Obstacles
Product Analysis:
It is a technique for understanding the features and functions
of a product. Techniques like ‘Value Analysis’ and ‘Quality
Function Deployment’ help the project manager gain more
information regarding the project. A cost/benefit analysis is
necessary for studying the various tangible and intangible
costs and benefits associated with the project.
Risk Analysis:
It is a report which describes the various risks associated with
the proposed project activities, their probability of occurrence
 and their severity. Formal procedures should be mentioned
to deal effectively with these risks in the POS. It also
describes risk identification techniques, risk quantification,
and other risk control measures.
Financial Analysis:
The following financial aspects of a project are analyzed in
the financial analysis which is an attachment to the POS. To
do so, a project manager must
1) Define the problem/opportunity clearly
2) Define the scope of the project, what it included and what
it does not include
4) Identify alternative solutions for the problems
5) Rank the alternative solutions
6) State the expected time and costs required
7) Project the profits from the project
8) List of recommendations.
Cost Benefit Analysis:
It explains the economic and social justification for the
 proposed project. But it is difficult to analyze project costs
and benefits as some intangible benefits cannot be
quantified.
Difference between Project Manager and Project Champion:
Project Managers Project Champions
• Prefer to work in groups * Working independently
• Committed to their managerial and * Committed to technology
technical responsibilities
• Committed to the corporation * Committed to profession
• Seek to achieve the objective * Seek to exceed the objective
• Are willing to take risks * Are unwilling to take risks; try to
test everything
• Seek what is possible * Seek perfection
• Think in terms of short time spans * Think in terms of long term spans
• Manage people * Manage things
• Are committed to and pursue * Are committed to and pursue
material intellectual
Project Managers: Are good at handling men and matters, but are not as sound
as the champion in technical matters.
Project Champions: Excellent ideas from their experience and knowledge but
are not very good at getting things done.
Project Manager VS Line Managers
Where a separate project department is set up, there is
always a constant tussle between the line managers and
the project manager.This tussle arises as both compete with
each other to share the organization’s:
i. Money
ii. Manpower
iii. Equipment
iv. Facilities
v. Materials, and
vi. Information/Technology

In such a situation, the success of a project depends on:

i. Presence of a good working relationship between the
project manager and the line manager and

ii. Effective handling of the cross reporting by the functional

employees ( the employees sent to work on the project)
The Project Manager
Co-ordinates and integrates activities being carried out
across various functional departments. So, he should posses
strong communicational and interpersonal skills to succeed.
Managing line staff is referred to as interface management,
as it involves:
i. Managing human relationships in the organization
with respect to all those connected with the project
ii. Balancing the managerial and technical functions
iii. Coping with risks associated with project
management
iv. Handling organizational restraints such as capital
rationing effectively
The Line Manager
Because of his tough bargaining in allocation of resources to
the projects, the line manager is generally considered to be
a villainous character by project managers. But on the
other side of the coin, he has his own problems:
 i. Limited availability of resources
ii. Having to cater to many work orders
iii. Deadlines to be met
iv. Unscheduled changes in the tasks to be done
v. Technical breakdowns
vi. Employee turnover, etc.
And, it is not as if the entire responsibility lies with the project
manager. If a task fails, the line manager is also accountable.
Project Management in India
Right from the inception, it should be said, that it has been
a failure in India. Severe time and cost overruns have been
the characteristics features of projects, particularly in the
public sector. The commonly quoted reasons for the overrun:
Internal reasons:
• Disputes with local people on acquisition of land and
compensation.
• Bad choice of technology
• Non-availability of skilled personnel.
 • Lack of proper planning.
• Non-availability of the equipment of required quality at the
required time.
• Poor quality of the inputs purchased.
• Labor disputes
• Lack of proper handling of organizational issues such as
appointment of the project manager.
• Absence of proper co-ordination between different
departments involved, such as customs, sales tax, etc.
• Lack of proper monitoring and follow up.
External Reasons
• Funds not being released by the concerned department
on time.
• Changes in foreign exchange rates.
• Inflation
• political instability and lack of political will to implement
projects quickly and efficiently.
• Budget deficits and diversion of funds to other uses.
Management of International Projects
The role of project management gains significance in
handling international projects effectively. There are certain
unique challenges faced by the project manager in managing
international projects such as political disturbances,
cultural barriers and so on.
The following points are considered in respect of
international projects:
Impact of the Business Environment on International Projects
Impact of Socioeconomic Environment on International Projects
Impact of Legal Environment on International Projects
Impact of Technological Environment on International Projects
Impact of Cultural Diversity on International Projects
Managerial Behavior in International Projects
Summary:
The development of project management has benefited the
organizations immensely by better co-ordination, orientation
towards customers’ needs and fast pace of achieving the targets.