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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
PROJECT MANAGEMENT THE #1 GUIDE FOR STUDENTS AND PROFESSIONALS, NOW UPDATED FOR THE LATEST TRENDS AND EMERGING ISSUES Project Management, or the "Project Management bible" as it's widely known, provides practical guidance on all aspects of project management. It features a streamlined approach to PM functions--in full alignment with the concepts and standards outlined in PMI's latest A Guide to the Project Management Body of Knowledge, (PMBOK¯® Guide)--without stinting on detailed coverage of the tools and methods used at all stages of a project. This 12th Edition has been updated to reflect recent changes to the PMBOK¯® Guide--Sixth Edition, and features in-depth coverage of emerging topics, including global stakeholder management, causes of failure, agile project management, project governance failure, customer approval milestones, classifying project metrics, and more. Also, supplementary materials are available for students, professionals, and instructors. * Understand organizational structures and project management functions * Learn how to control costs, manage risk, and analyze trade-offs * Examine different methods used for planning, scheduling, QA, and more * Work effectively with customers and stakeholders from around the globe As projects increase in scope and complexity, managing them across time zones, language barriers, and technology platforms requires a systematic approach that accounts for every detail. All the more reason to keep Project Management, 12th Edition within arm's reach throughout all stages of the projects you manage.
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PROJECT MANAGEMENT
A Systems Approach to Planning, Scheduling, and Controlling
TWELFTH EDITION
HAROLD KERZNER, Ph. D.
This book is printed on acid-free paper.
Copyright © 2017 by John Wiley & Sons, Inc. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
PMI, CAPM, PMBOK, PMP and Project Management Professional are registered marks of the Project Management Institute, Inc.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at www.wiley.com/go/permissions.
Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with the respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor the author shall be liable for damages arising herefrom.
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Cover images: © Aeriform/Getty Images, Inc.
Cover design: Wiley
Library of Congress Cataloging-in-Publication Data:
Names: Kerzner, Harold, author.
Title: Project management : a systems approach to planning, scheduling, and controlling / Harold Kerzner.
Description: Twelfth edition. | Hoboken, New Jersey : John Wiley & Sons, Inc., 2017. | Includes bibliographical references and index.
Identifiers: LCCN 2016045434| ISBN 9781119165354 (hardback) | ISBN 9781119165361 (epub); 9781119165378 (epdf)
Subjects: LCSH: Project management. | Project management–Case studies. | BISAC: TECHNOLOGY & ENGINEERING / Industrial Engineering.
Classification: LCC HD69.P75 K47 2017 | DDC 658.4/04–dc23 LC record available at
https://lccn.loc.gov/2016045434
To my wife, Jo Ellyn, for her more than thirty years of unending love, devotion, and encouragement to continue my writing of project management books
Contents
Preface
1 Overview
1.0 Introduction
1.1 Understanding Project Management
1.2 Defining Project Success
1.3 Trade-OFfs and Competing Constraints
1.4 The Entry-Level Project Manager
1.5 The Talent Triangle
1.6 Technology-Based Projects
1.7 The Project Manager–Line Manager Interface
1.8 Defining the Project Manager’s Role
1.9 Defining the Functional Manager’s Role
1.10 Defining the Functional Employee’s Role
1.11 Defining the Executive’s Role
1.12 Working with Executives
1.13 Committee Sponsorship/Governance
1.14 the Project Manager as the Planning Agent
1.15 Project Champions
1.16 Project-Driven versus Non–Project-Driven Organizations
1.17 Marketing in the Project-Driven Organization
1.18 Classification of Projects
1.19 Location of the Project Manager
1.20 Differing Views of Project Management
1.21 Public-Sector Project Management
The Coming Storm
Why Do Public-Sector Projects Fail?
1.22 International Project Management
1.23 Concurrent Engineering: A Project Management Approach
1.24 Added Value
1.25 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Study
Notes
2 Project Management Growth: Concepts and Definitions
2.0 Introduction
2.1 The Evolution of Project Management: 1945–2017
2.2 Resistance to Change
2.3 Systems, Programs, and Projects: A Definition
2.4 Product versus Project Management: A Definition
2.5 Maturity and Excellence: A Definition
2.6 Informal Project Management: A Definition
2.7 The Many Faces of Success
2.8 The Many Faces of Failure
2.9 Causes of Project Failure
2.10 Degrees of Success and Failure
2.11 The Stage-Gate Process
2.12 Project Life Cycles
2.13 Gate Review Meetings (Project Closure)
2.14 Engagement Project Management
2.15 Project Management Methodologies: A Definition
2.16 From Enterprise Project Management Methodologies to Frameworks
2.17 Methodologies Can Fail
2.18 Organizational Change Management and Corporate Cultures
2.19 Benefits Harvesting and Cultural Change
2.20 Agile and Adaptive Project Management Cultures
2.21 Project Management Intellectual Property
2.22 Systems Thinking
2.23 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Study
Notes
3 Organizational Structures
3.0 Introduction
3.1 Organizational Work Flow
3.2 Traditional (Classical) Organization
3.3 Pure Product (Projectized) Organization
3.4 Matrix Organizational Form
3.5 Modification of Matrix Structures
3.6 The Strong, Weak, or Balanced Matrix
3.7 Project Management Offices
3.8 Selecting the Organizational Form
3.9 Strategic Business Unit (SBU) Project Management
3.10 Transitional Management
3.11 Seven Fallacies that Delay Project Management Maturity
3.12 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Notes
4 Organizing and Staffing the Project Office and Team
4.0 Introduction
4.1 The Staffing Environment
4.2 Selecting the Project Manager: an Executive Decision
4.3 Skill Requirements for Project and Program Managers
4.4 Special Cases in Project Manager Selection
4.5 Today’s Project Managers
4.6 Duties and Job Descriptions
4.7 The Organizational Staffing Process
4.8 The Project Office
4.9 The Functional Team
4.10 The Project Organizational Chart
4.11 Selecting the Project Management Implementation Team
4.12 Mistakes Made by Inexperienced Project Managers
4.13 Studying Tips for the PMI® Project Management Certification Exam
Answers
Problems
Notes
5 Management Functions
5.0 Introduction
5.1 Controlling
5.2 Directing
5.3 Project Authority
5.4 Interpersonal Influences
5.5 Barriers to Project Team Development
5.6 Suggestions for Handling the Newly Formed Team
5.7 Team Building as an Ongoing Process
5.8 Leadership in a Project Environment
5.9 Value-Based Project Leadership
5.10 Transformational Project Management Leadership
5.11 Organizational Impact
5.12 Employee–Manager Problems
5.13 General Management Pitfalls
5.14 Time Management Pitfalls
5.15 Management Policies and Procedures
5.16 Human Behavior Education
5.17 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Studies
Notes
6 Communications Management
6.0 Introduction
6.1 Modeling the Communications Environment
6.2 The Project Manager as a Communicator
6.3 Project Review Meetings
6.4 Project Management Bottlenecks
6.5 Active Listening
6.6 Communication Traps
6.7 Project Problem Solving
6.8 Brainstorming
6.9 Predicting the Outcome of a Decision
6.10 Facilitation
6.11 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Studies
Notes
7 Conflicts
7.0 Introduction
7.1 The Conflict Environment
7.2 Types of Conflicts
7.3 Conflict Resolution
7.4 The Management of Conflicts
7.5 Conflict Resolution Modes
7.6 Understanding Superior, Subordinate, and Functional Conflicts
7.7 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Studies
Notes
8 Special Topics
8.0 Introduction
8.1 Performance Measurement
8.2 Financial Compensation and Rewards
8.3 Effective Project Management in the Small Business Organization
8.4 Mega Projects
8.5 Morality, Ethics, and the Corporate Culture
8.6 Professional Responsibilities
8.7 Internal and External Partnerships
8.8 Training and Education
8.10 Integrated Product/Project Teams
8.10 Virtual Project Teams
8.11 Managing Innovation Projects
8.12 Agile Project Management
Problems
Case Study
Notes
9 The Variables for Success
9.0 Introduction
9.1 Predicting Project Success
9.2 Project Management Effectiveness
9.3 Expectations
9.4 Lessons Learned
9.5 Understanding Best Practices
9.6 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Study
Notes
10 Working with Executives
10.0 Introduction
10.1 The Project Sponsor
10.2 Handling Disagreements with the Sponsor
10.3 The Collective Belief
10.4 The Exit Champion
10.5 The In-House Representatives
10.6 Stakeholder Relations Management
10.7 Project Portfolio Management
10.8 Politics
10.9 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Studies
Notes
11 Planning
11.0 Introduction
11.1 Business Case
11.2 Validating the Assumptions
11.3 Validating the Objectives
11.4 General Planning
11.5 Life-Cycle Phases
11.6 Life-Cycle Milestones
11.7 Kickoff Meetings
11.8 Understanding Participants’ Roles
11.9 Establishing Project Objectives
11.10 The Statement of Work
11.11 Project Specifications
11.12 Data Item Milestone Schedules
11.13 Work Breakdown Structure
11.14 Wbs Decomposition Problems
11.15 Work Breakdown Structure Dictionary
11.16 Project Selection
11.17 The Role of the Executive in Planning
11.18 Management Cost and Control System
11.19 Work Planning Authorization
11.20 Why Do Plans Fail?
11.21 Stopping Projects
11.22 Handling Project Phaseouts and Transfers
11.23 Detailed Schedules and Charts
11.24 Master Production Scheduling
11.25 Project Plan
11.26 The Project Charter
11.27 Project Baselines
11.28 Verification and Validation
11.29 Management Control
11.30 Configuration Management
11.31 Enterprise Project Management Methodologies
11.32 Project Audits
11.33 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Notes
12 Network Scheduling Techniques
12.0 Introduction
12.1 Network Fundamentals
12.2 Graphical Evaluation and Review Technique (Gert)
12.3 Dependencies
12.4 Slack Time
12.5 Network Replanning
12.6 Estimating Activity Time
12.7 Estimating Total Project Time
12.8 Total Pert/Cpm Planning
12.9 Crash Times
12.10 Pert/Cpm Problem Areas
12.11 Alternative Pert/Cpm Models
12.12 Precedence Networks
12.13 Lag
12.14 Scheduling Problems
12.15 The Myths of Schedule Compression
12.16 Project Management Software
12.17 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Study
Notes
13 Pricing and Estimating
13.0 Introduction
13.1 Global Pricing Strategies
13.2 Types of Estimates
13.3 Pricing Process
13.4 Organizational Input Requirements
13.5 Labor Distributions
13.6 Overhead Rates
13.7 Materials/Support Costs
13.8 Pricing Out the Work
13.9 Smoothing Out Department Man-Hours
13.10 The Pricing Review Procedure
13.11 Systems Pricing
13.12 Developing the Supporting/Backup Costs
13.13 The Low-Bidder Dilemma
13.14 Special Problems
13.15 Estimating Pitfalls
13.16 Estimating High-Risk Projects
13.17 Project Risks
13.18 The Disaster of Applying the 10 Percent Solution to Project Estimates
13.19 Life-Cycle Costing (LCC)
13.20 Logistics Support
13.21 Economic Project Selection Criteria: Capital Budgeting
13.22 Payback Period
13.23 The Time Value of Money and Discounted Cash Flow (DCF)
13.24 Net Present Value (NPV)
13.25 Internal Rate of Return (IRR)
13.26 Comparing IRR, NPV, and Payback
13.27 Risk Analysis
13.28 Capital Rationing
13.29 Project Financing
13.30 Studying Tips for the PMI
®
Project Management Certification Exam
13.32 Answers
Problems
Case Study
Notes
14 Cost Control
14.0 Introduction
14.1 Understanding Control
14.2 The Operating Cycle
14.3 Cost Account Codes
14.4 Budgets
14.5 The Earned Value Measurement System (EVMS)
14.6 Variance and Earned Value
14.7 The Cost Baseline
14.8 Justifying the Costs
14.9 The Cost Overrun Dilemma
14.10 Recording Material Costs Using Earned Value Measurement
14.11 Material Variances: Price and Usage
14.12 Summary Variances
14.13 Status Reporting
14.14 Cost Control Problems
14.15 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Studies
Notes
15 Metrics
15.0 Introduction
15.1 Project Management Information Systems
15.2 Enterprise Resource Planning
15.3 Project Metrics
15.4 Key Performance Indicators (KPIS)
15.5 Value-Based Metrics
15.6 Dashboards and Scorecards
15.7 Business Intelligence
15.8 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Notes
16 Trade-Off Analysis in a Project Environment
16.0 Introduction
16.1 Methodology for Trade-Off Analysis
16.2 Contracts: Their Influence on Projects
16.3 Industry Trade-Off Preferences
16.4 Project Manager’s Control of Trade-Offs
16.5 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Notes
17 Risk Management
17.0 Introduction
17.1 Definition of Risk
17.2 Tolerance for Risk
17.3 Definition of Risk Management
17.4 Certainty, Risk, and Uncertainty
17.5 Risk Management Process
17.6 Plan Risk Management
17.7 Risk Identification
17.8 Risk Analysis
17.9 Qualitative Risk Analysis
17.10 Quantitative Risk Analysis
17.11 Plan Risk Response
17.12 Monitor and Control Risks
17.13 Some Implementation Considerations
17.14 The Use of Lessons Learned
17.15 Dependencies Between Risks
17.16 The Impact of Risk Handling Measures
17.17 Risk and Concurrent Engineering
17.18 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Case Studies
Notes
18 Learning Curves
18.0 Introduction
18.1 General Theory
18.2 The Learning Curve Concept
18.3 Graphic Representation
18.4 Key Words Associated with Learning Curves
18.5 The Cumulative Average Curve
18.6 Sources of Experience
18.7 Developing Slope Measures
18.8 Unit Costs and Use of Midpoints
18.9 Selection of Learning Curves
18.10 Follow-On Orders
18.11 Manufacturing Breaks
18.12 Learning Curve Limitations
18.13 Competitive Weapon
18.14 Studying Tips for the PMI
®
Project Management Certification Exam
Answers
Problems
Notes
19 Contract Management
19.0 Introduction
19.1 Procurement
19.2 Plan Procurements
19.3 Conducting the Procurements
19.4 Conduct Procurements: Request Seller Responses
19.5 Conduct Procurements: Select Sellers
19.6 Types of Contracts
19.7 Incentive Contracts
19.8 Contract Type Versus Risk
19.9 Contract Administration
19.10 Contract Closure
19.11 Using a Checklist
19.12 Proposal-Contractual Interaction
19.13 Studying Tips for the PMI® Project Management Certification Exam
Answers
Problems
Case Studies
Notes
20 Quality Management
20.0 Introduction
20.1 Definition of Quality
20.2 The Quality Movement
20.3 Quality Management Concepts
20.4 The Cost of Quality
20.5 The Seven Quality Control Tools
20.6 Acceptance Sampling
20.7 Implementing Six Sigma
20.8 Quality Leadership
20.9 Responsibility for Quality
20.10 Quality Circles
20.11 Total Quality Management (TQM)
20.12 Studying Tips for the PMI
®
Project Management Certification Exam
20.14 Answers
Problems
Notes
21 Modern Developments in Project Management
21.0 Introduction
21.1 The Project Management Maturity Model (PMMM)
21.2 Developing Effective Procedural Documentation
21.3 Project Management Methodologies
21.4 Continuous Improvement
21.5 Capacity Planning
21.6 Competency Models
21.7 Managing Multiple Projects
21.8 The Business of Scope Changes
21.9 End-of-Phase Review Meetings
Case Study
Notes
Appendix A: Solution to Leadership Exercise
Situation 1
Situation 2
Situation 3
Situation 4
Situation 5
Situation 6
Situation 7
Situation 8
Situation 9
Situation 10
Situation 11
Situation 12
Situation 13
Situation 14
Situation 15
Situation 16
Situation 17
Situation 18
Situation 19
Situation 20
Appendix B: Solutions to the Project Management Conflict Exercise
Part One: Facing The Conflict
Part Two: Understanding Emotions
Part Three: Establishing Communications
Part Four: Conflict Resolution
Part Five: Understanding Your Choices
Part Six: Interpersonal Influences
Appendix C: Dorale Products Case Studies
Dorale Products (A)
Dorale Products (B)
Dorale Products (C)
Dorale Products (D)
Dorale Products (E)
Dorale Products (F)
Dorale Products (G)
Dorale Products (H)
Dorale Products (I)
Dorale Products (J)
Note
Appendix D: Solutions to the Dorale Products Case Studies
Case Study (A)
Case Study (B)
Case Study (C)
Case Study (D)
Case Study (E)
Case Study (F)
Case Study (G)
Case Study (H)
Case Study (I)
Case Study (J)
Case Study (K)
Appendix E: Alignment of the
PMBOK
®
Guide
to the Text
Note
Author Index
Subject Index
EULA
Guide
Cover
Table of Contents
Preface
List of Tables
1
TABLE 1-1.
TABLE 1-2.
TABLE 1-3.
TABLE 1-4.
TABLE 1-5.
2
TABLE 2-1.
TABLE 2-2.
TABLE 2-3.
TABLE 2-4.
TABLE 2-5.
TABLE 2-6.
TABLE 2-7.
TABLE 2-8.
TABLE 2-9.
TABLE 2-10.
TABLE 2-11.
TABLE 2-12.
TABLE 2-13.
3
TABLE 3-1.
TABLE 3-2.
TABLE 3-3.
TABLE 3-4.
TABLE 3-5.
4
TABLE 4-1.
5
TABLE 5-1.
TABLE 5-2.
TABLE 5-3.
TABLE 5-4.
6
TABLE 6-1.
TABLE 6-2.
TABLE 6-3.
8
TABLE 8-1.
TABLE 8-2.
TABLE 8-3.
TABLE 8-4.
TABLE 8-5.
TABLE 8-6.
TABLE 8-7.
TABLE 8-8.
TABLE 8-9.
9
TABLE 9-1.
TABLE 9-2.
10
TABLE 10-1.
TABLE 10-2.
TABLE 10-3.
11
TABLE 11-1.
TABLE 11-2.
TABLE 11-3.
TABLE 11-4.
TABLE 11-5.
TABLE 11-6.
TABLE 11-7.
TABLE 11-8.
12
TABLE 12-1.
TABLE 12-2.
TABLE 12-3.
13
TABLE 13-1.
TABLE 13-2.
TABLE 13-3.
TABLE 13-4.
TABLE 13-5.
TABLE 13-6.
TABLE 13-7.
TABLE 13-8.
TABLE 13-9.
TABLE 13-10.
TABLE 13-11.
TABLE 13-12.
TABLE 13-13.
TABLE 13-14.
TABLE 13-15.
TABLE 13-16.
TABLE 13-17.
TABLE 13-18.
14
TABLE 14-1.
TABLE 14-2.
TABLE 14-3.
TABLE 14-4.
TABLE 14-5.
15
TABLE 15-1.
TABLE 15-2.
TABLE 15-3.
TABLE 15-4.
TABLE 15-5.
TABLE 15-6.
16
TABLE 16-1.
TABLE 16-2.
TABLE 16-3.
TABLE 16-4.
TABLE 16-5.
TABLE 16-6.
17
TABLE 17-1.
TABLE 17-2.
TABLE 17-3.
TABLE 17-4.
TABLE 17-5.
TABLE 17-6.
TABLE 17-7.
TABLE 17-8.
TABLE 17-9.
18
TABLE 18-1.
TABLE 18-2.
19
TABLE 19-1.
TABLE 19-2.
20
TABLE 20-1.
TABLE 20-2.
TABLE 20-3.
TABLE 20-4.
List of Illustrations
1
FIGURE 1-1.
Organizational gaps.
FIGURE 1-2.
Overview of project management.
FIGURE 1-3.
Competing constraints.
FIGURE 1-4.
Integration management.
FIGURE 1-5.
The project sponsor interface.
FIGURE 1-6.
The tip-of-the-iceberg syndrome for matrix implementation.
FIGURE 1-7.
Organizational hierarchy.
2
FIGURE 2-1.
Project management costs versus benefits.
FIGURE 2-2.
Industry classification (by project management utilization).
FIGURE 2-3.
From hybrid to project-driven.
FIGURE 2-4.
The growth of excellence.
FIGURE 2-5.
Evolution of policies, procedures, and guidelines.
FIGURE 2-6.
Maturity path.
FIGURE 2-7.
Success: point or cube?
FIGURE 2-8.
Components of failure (pessimistic planning).
FIGURE 2-9.
.Components of failure (optimistic planning).
FIGURE 2-10.
.Risk planning.
FIGURE 2-11.
The relationship between marketing and technical personnel.
FIGURE 2-12.
System costs.
FIGURE 2-13.
Cost–benefit analysis.
FIGURE 2-14.
A stream of projects.
FIGURE 2-15.
Integrated processes for the twenty-first century.
FIGURE 2-16.
Integrated processes (past, present, and future).
FIGURE 2-17.
Methodology inputs.
FIGURE 2-18.
Resistance to change.
FIGURE 2-19.
Change process.
FIGURE 2-20.
Facets of a project management culture.
FIGURE 2-21.
Growth of knowledge management.
FIGURE 2-22.
PM benchmarking and knowledge management (KM).
FIGURE 2-23.
The systems approach.
3
FIGURE 3-1.
The traditional management structure.
FIGURE 3-2.
Pure product or projectized structure.
FIGURE 3-3.
Typical matrix structure.
FIGURE 3-4.
Development of a director of project management.
FIGURE 3-5.
Philosophy of management.
FIGURE 3-6.
Strategic business unit project management.
FIGURE 3-7.
SBU project management using platform management.
4
FIGURE 4-1.
Project management skills.
FIGURE 4-2.
How do project managers spend their time?
FIGURE 4-3.
Staffing pattern versus time.
FIGURE 4-4.
Project organization.
FIGURE 4-5.
Dalton Corporation.
FIGURE 4-6.
Midas Program Office.
FIGURE 4-7.
Project engineering department manning for the Midas Program.
FIGURE 4-8.
Roles people play that undermine project management implementation.
FIGURE 4-9.
Roles people play that support project management implementation.
5
FIGURE 5-1.
Linear responsibility chart (responsibility assignment matrix).
FIGURE 5-2.
Types of project authority.
FIGURE 5-3.
The range of alternatives. Source: Jay R. Galbraith, “Matrix Organization Designs.” Reprinted with permission from
Business Horizons,
February 1971, p. 37. Copyright © 1971 by the Board of Trustees at Indiana University.
6
FIGURE 6-1.
A breakdown in communications. (Source unknown)
FIGURE 6-2.
Communication channels. Source: D. I. Cleland and H. Kerzner,
Engineering Team Management
(Melbourne, Florida: Krieger, 1986), p. 39.
FIGURE 6-3.
Customer communications. Source: D. I. Cleland and H. Kerzner,
Engineering Team Management
(Melbourne, Florida: Krieger, 1986), p. 64.
FIGURE 6-4.
Total communication process.
FIGURE 6-5.
Information flow pattern from contractor program office.
FIGURE 6-6.
Impact analysis matrix.
7
FIGURE 7-1.
Relationship between conflict causes and sources.
FIGURE 7-2.
Association between perceived intensity of conflict and mode of conflict resolution.
FIGURE 7-3.
Association between influence methods of project managers and their perceived conflict intensity.
8
FIGURE 8-1.
Guide to performance appraisal.
FIGURE 8-2.
Description-based evaluation form.
FIGURE 8-3.
Rate-based evaluation form.
FIGURE 8-4.
Project termination evaluation form.
FIGURE 8-5.
Job evaluation.
FIGURE 8-6.
Project management learning curve.
FIGURE 8-7.
Lost knowledge within the learning curve.
FIGURE 8-8.
Knowledge and authority.
9
FIGURE 9-1.
Levels of best practices.
FIGURE 9-2.
Usefulness of best practices.
FIGURE 9-3.
Levels of best practices.
FIGURE 9-4.
Creating a best practices library.
FIGURE 9-5.
Best practices library.
10
FIGURE 10-1.
Project sponsorship.
FIGURE 10-2.
Stakeholder power-interest grid.
Exhibit 10.1
Levon’s gap analysis
Exhibit 10.2
Project management performance trend
Exhibit 10.3
Increasing performance gap
11
FIGURE 11-1.
Typical project launch.
FIGURE 11-2.
Work breakdown structure for objective control and evaluation.
Source:
Paul Mali,
Managing by Objectives
(New York: John Wiley & Sons, 1972), p. 163. Copyright © 1972 by John Wiley & Sons. Reprinted by permission of the publisher.
FIGURE 11-3.
A work package for the cost account intersection within a WBS.
FIGURE 11-4.
WBS tree diagram.
FIGURE 11-5.
Illustration of a scaling model for one project, Project A.
Source:
William E. Souder, Project Selection and Economic Appraisal, p. 66.
FIGURE 11-6.
Illustration of a checklist for three projects.
Source:
William Souder, Project Selection and Economic Appraisal, p. 68.
FIGURE 11-7.
Illustration of a scoring model.
Source:
William Souder, Project Selection
and Economic Appraisal,
p. 69.
FIGURE 11-8.
Phases of a management cost and control system.
FIGURE 11-9.
The planning cycle of a management cost and control system.
FIGURE 11-10.
Preparation sequence for schedules and program plans.
FIGURE 11-11.
Material requirements planning interrelationships.
FIGURE 11-12.
Iterations for the planning process.
FIGURE 11-13.
Project direction activities.
12
FIGURE 12-1.
STANDARD PERT NOMENCLATURE.
FIGURE 12-2.
PERT sources (burst points) and sinks.
FIGURE 12-3.
Conversion from bar chart to PERT chart.
FIGURE 12-4.
Simplified PERT network.
FIGURE 12-5.
Dummy activity.
FIGURE 12-6.
Network with slack time.
FIGURE 12-7.
Comparison models for a time-phase PERT chart.
FIGURE 12-8.
Slack identification.
FIGURE 12-9.
A typical PERT chart with slack times.
FIGURE 12-10.
Slack time.
FIGURE 12-11.
Iteration process for PERT schedule development.
FIGURE 12-12.
Network replanning of Figure 12–6.
FIGURE 12-13.
Parallelization of PERT activities.
FIGURE 12-14.
PERT chart for one department.
FIGURE 12-15.
Expected time analysis for critical path events in Figure 12–6.
FIGURE 12-16.
CPM network.
FIGURE 12-17.
CPM crashing costs.
FIGURE 12-18.
Region of feasible budgets.
FIGURE 12-19.
Determining project duration.
FIGURE 12-20.
CPM network with slack.
FIGURE 12-21.
Precedence network.
FIGURE 12-22.
Typical precedence relationships.
FIGURE 12-23.
Computerized information flow.
FIGURE 12-24.
Precedence charts with lag.
13
FIGURE 13-1.
The vertical–horizontal interface.
FIGURE 13-2.
Functional pricing flow.
FIGURE 13-3.
Material planning flowchart.
FIGURE 13-4.
Procurement activity.
FIGURE 13-5.
Typical manpower loading.
FIGURE 13-6.
Linearly increased manpower loading.
FIGURE 13-7.
The pricing review procedure.
FIGURE 13-8.
System approach to resource control.
FIGURE 13-9.
Total reimbursable manpower.
FIGURE 13-10.
The moving window/rolling wave concept.
FIGURE 13-11.
Decision elements for risk contingencies.
FIGURE 13-12.
Elements of base cost and risk contingencies.
FIGURE 13-13.
Investment opportunity schedule (IOS) for Table 13.18.
14
FIGURE 14-1.
Phases of a management cost and control system.
FIGURE 14-2.
Cost reduction analysis.
FIGURE 14-3.
Cost influencers.
FIGURE 14-4.
The cost account intersection.
FIGURE 14-5.
Cost account code breakdown.
FIGURE 14-6.
Work authorization form.
FIGURE 14-7.
Planning and budgeting describe, plan, and schedule the work.
FIGURE 14-8.
Cost account change notice (CACN).
FIGURE 14-9.
Cost data collection and reporting flowchart.
FIGURE 14-10.
Project variance projection.
FIGURE 14-11.
The performance index.
FIGURE 14-12.
Integrated cost/schedule system.
FIGURE 14-13.
Cost account variance analysis report.
FIGURE 14-14.
Analysis showing use of 50/50 rule.
FIGURE 14-15.
Project Z, task 3 cost data (contractual).
FIGURE 14-16.
Physical progress versus time expended.
FIGURE 14-17.
The cost baseline.
FIGURE 14-18.
WBS level 1 cost breakdown.
FIGURE 14-19.
Range of overruns.
15
FIGURE 15-1.
The boundary box
16
FIGURE 16-1.
Overview of project management.
FIGURE 16-2.
Project management with trade-offs.
FIGURE 16-3.
Trade-off forcing factors.
FIGURE 16-4.
The typical systems approach.
FIGURE 16-5.
Trade-offs with fixed performance.
FIGURE 16-6.
Trade-offs with fixed performance.
FIGURE 16-7.
Trade-offs with fixed cost.
FIGURE 16-8.
Trade-offs with fixed time.
FIGURE 16-9.
Performance versus cost.
FIGURE 16-10.
Trade-off analysis with family of curves.
FIGURE 16-11.
Cost–time–performance family of curves.
FIGURE 16-12.
Life-cycle trade-offs. (Schedule not necessarily typical.)
17
FIGURE 17-1.
Overall risk is a function of its components.
FIGURE 17-2.
Risk preference and the utility function.
FIGURE 17-3.
Decision tree.
FIGURE 17-4.
Expanded decision tree.
FIGURE 17-5.
Life-cycle risk analysis.
FIGURE 17-6.
Prioritization of risks.
FIGURE 17-7.
Ordering of trade-offs (Note: Lower priorities more often undergo trade-offs.).
FIGURE 17-8.
Tolerance for risk.
FIGURE 17-9.
Risk handling measures.
FIGURE 17-10.
Investment in risk management.
FIGURE 17-11.
Risk handling versus schedule length.
FIGURE 17-12.
Perfect planning.
FIGURE 17-13.
Imperfect planning.
FIGURE 17-14.
Overlapping risks.
FIGURE 17-15.
Future risks.
FIGURE 17-16.
Risk analysis prioritization.
FIGURE 17-17.
Military operation probability impact matrix.
18
FIGURE 18-1.
A 75 percent learning curve.
FIGURE 18-2.
Logarithmic plot of a 75 percent learning curve.
FIGURE 18-3.
A “toe-down” learning curve.
FIGURE 18-4.
A “toe-up” learning curve.
FIGURE 18-5.
A leveling off of the learning curve.
19
FIGURE 19-1.
Fixed-price-incentive-fee (FPIF) contract with firm target.
FIGURE 19-2.
Cost-plus-incentive-fee (CPIF) contract.
FIGURE 19-3.
Contract types and risk types.
20
FIGURE 20-1.
Kodak’s five quality principles.
FIGURE 20-2.
The quality improvement process. (Source unknown.)
FIGURE 20-3.
The Deming Cycle for Improvement.
FIGURE 20-4.
Total quality cost.
FIGURE 20-5.
Minimizing the costs of quality (COQ).
FIGURE 20-6.
The seven quality control tools.
FIGURE 20-7.
Check sheet for material receipt and inspection.
FIGURE 20-8.
Cause-and-effect diagram.
FIGURE 20-9.
Random method.
FIGURE 20-10.
Systematic method.
FIGURE 20-11.
Process analysis method.
FIGURE 20-12.
Identify corrective action.
FIGURE 20-13.
Histogram for variables.
FIGURE 20-14.
Basic Pareto analysis.
FIGURE 20-15.
Basic Pareto analysis.
FIGURE 20-16.
Comparative Pareto analysis.
FIGURE 20-17.
Solder certification test scores.
FIGURE 20-18.
Scatter plot correlation.
FIGURE 20-19.
Scatter plot solder quality and certification score.
FIGURE 20-20.
The control chart and the normal curve.
FIGURE 20-21.
TQM objectives and focus areas.
21
FIGURE 21-1.
The five levels of maturity.
FIGURE 21-2.
Overlapping levels.
FIGURE 21-3.
Feedback between the five levels of maturity.
FIGURE 21-4.
Degrees of difficulty of the five levels of maturity.
FIGURE 21-5.
Interrelationship of project activities with various functional/organizational levels and project management levels.
FIGURE 21-6.
Categorizing procedural documents within a work breakdown structure.
FIGURE 21-7.
Why there is a need for continuous improvement.
FIGURE 21-8.
The need for continuous improvement.
FIGURE 21-9.
Classical capacity planning.
FIGURE 21-10.
Improved capacity planning.
FIGURE 21-11.
Competency model.
FIGURE 21-12.
Core competency analysis.
FIGURE 21-13.
Competency models and training.
FIGURE 21-14.
Sequential contractors.
FIGURE 21-15.
Overlapping contractors.
FIGURE 21-16.
Factors to consider for scope changes.
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Preface
Project management has evolved from a management philosophy restricted to a few functional areas and regarded as something nice to have to an enterprise project management system affecting every functional unit of the company. Simply stated, project management has evolved into a business process rather than merely a project management process. More and more companies are now regarding project management as being mandatory for the survival of the firm. Organizations that were opponents of project management are now advocates. Management educators of the past, who preached that project management could not work and would be just another fad, are now staunch supporters. Project management is here to stay. Colleges and universities are now offering undergraduate and graduate degrees in project management.
This book is addressed not only to those undergraduate and graduate students who wish to improve upon their project management skills but also to those functional managers and upper-level executives who serve as project sponsors and must provide continuous support for projects. During the past several years, management’s knowledge and understanding of project management has matured to the point where almost every company is using project management in one form or another. These companies have come to the realization that project management and productivity are related, and that we are now managing our business as though it is a series of projects. Project management coursework is now consuming more of training budgets than ever before.
General reference is provided in the text to engineers. However, the reader should not consider project management as strictly engineering-related. The engineering examples are the result of the fact that project management first appeared in the engineering disciplines, and we should be willing to learn from their mistakes. Project management now resides in every profession, including information systems, healthcare, consulting, pharmaceutical, banks, and government agencies.
The text can be used for both undergraduate and graduate courses in business, information systems, and engineering. The structure of the text is based upon my belief that project management is much more behavioral than quantitative since projects are managed by people rather than tools. The first seven chapters are part of the basic core of knowledge necessary to understand project management, specifically topics related to PMI’s “Talent Triangle.” Chapters 8 through 10 deal with the support functions and describe factors for predicting success and management support. It may seem strange that ten chapters on organizational behavior and structuring are needed prior to the “hard-core” chapters of planning, scheduling, and controlling. These first ten chapters are needed to understand the cultural environment for all projects and systems. These chapters are necessary for the reader to understand the difficulties in achieving cross-functional cooperation on projects where team members are working on multiple projects concurrently and why the people involved, all of whom may have different backgrounds, cannot simply be forged into a cohesive work unit without friction. Chapters 11 through 20 are more of the quantitative chapters on planning, scheduling, cost control, estimating, contracting (and procurement), and quality. Chapter 21 focuses on some of the more advanced topics.
The changes that were made in the twelfth edition include:
Updated section on the Introduction to Project Management
Updated section on Competing Constraints
New section on the Talent Triangle
New section on Entry-Level Project Management
New section on Technology-Based Projects
Updated section on the Many Faces of Project Success
New section on Converting Methodologies to Frameworks
New section on the Causes of Project Failure
New section on Degrees of Project Success and Failure
Updated section on Knowledge Management and Data Warehouses
Updated section on Project Management Intellectual Property
New section on Benefits Harvesting and Cultural Change
New section on Transformational Project Management Leadership
Updated section on Managing Mega Projects
Updated section on Agile Project Management
New section on Agile and Adaptive Project Management Cultures
Updated section on Multinational Project Management Sponsorship
New section on Preparing a Project Business Case
Updated section on Validating the Project’s Assumptions
Updated section on Validating the Project’s Objectives
New section on Life-Cycle Milestones
New section on the Project Management Office
New section on Project Portfolio Management
Updated section on Best Practices
Updated section on Resource Leveling Issues
The text contains case studies, multiple choice questions, and discussion questions. There is also a separate companion book of cases (Project Management Case Studies, fifth edition) that provides additional real-world examples. Some of the new case studies include in the case book are:
Case Study
Description
Disney (A) Imagineering Project Management
Discusses some of the different skill sets needed to be an Imagineering PM
Disney (B) Imagineering in Action: The Haunted Mansion
Discusses the challenges with evolving scope on a project
Disney (C) Theme Parks and Enterprise Environmental Factors
Discusses how important an understanding of the enterprise environmental factors are and how they can impact project success
Disney (D) The Globalization of Disney
Discusses the challenges facing the use of project management on a global scale
Disney (E) Hong Kong Ocean Park: Competing Against Disney
Discusses how one company competed against Disney by expanding the project’s scope
Olympics (A) Managing Olympic Projects
Discusses how the enterprise environmental factors impact Olympic projects
Olympics (B) Olympics, Project Management and PMI’s Code of Ethics and Professional Responsibility
Discusses the complexity of abiding by PMI’s Code of Conduct and Professional Responsibility on some Olympic projects
Olympics (C) Feeding the Olympic Athletes
Discusses the complexities (including quality control) for feeding 23,000 Olympians, coaches and staff members
Olympics (D) Health and Safety Risks at Olympic Events
Discusses the health and safety risks when of allowing athletes to compete in environments that have known health risks
Tradeoffs (A), (B)
Discusses how the introduction of competing constraints mandated additional tradeoffs and the challenges the company faced
The Project Management Audit
Discusses the need for occasional audits on a project and what happens executives are displeased with the results
The Executive Director
Discusses how a newly appointed executive director in a government agency played the political game to prevent being blamed for any wrong-doing
The twelfth edition text, the PMBOK®Guide and the book of cases are ideal as self-study tools for the Project Management Institute’s PMP® Certification Exam. Because of this, there are tables of cross references at the end of each chapter in the textbook detailing the sections from the book of cases and the Guide to the Project Management Body of Knowledge (PMBOK®Guide) that apply to that chapter’s content. The left-hand margin of the pages in the text has side bars that identify the cross-listing of the material on that page to the appropriate section(s) of the PMBOK®Guide. At the end of most of the chapters is a section on study tips for the PMP® exam.
This textbook is currently used in the college market, in the reference market, and for studying for the PMP® Certification Exam. Therefore, to satisfy the needs of all markets, a compromise had to be reached on how much of the text would be aligned to the PMBOK®Guide and how much new material would be included without doubling the size of the text. Some colleges and universities use the textbook to teach project management fundamentals without reference to the PMBOK®Guide. The text does not contain all of the material necessary to support each section or process in the PMBOK®Guide. Therefore, to study for the PMP® Certification Exam, the PMBOK®Guide must also be used together with this text. The text covers material for almost all of the PMBOK®Guide knowledge areas but not necessarily in the depth that appears in the PMBOK®Guide.
An instructor’s manual is available only to college and university faculty members by contacting your local Wiley sales representative or by visiting the Wiley website at www.wiley.com/kerzner. Access to the instructor’s material and supporting material can be provided only through John Wiley & Sons Publishers, not the author.
One-, two-, and three-day seminars on project management and the PMP® Certification Training using the text are offered by contacting Lori Milhaven, Executive Vice President, the International Institute for Learning, at 800-325-1533, extension 5121 (e-mail address: [email protected]).
The problems and case studies at the ends of the chapters cover a variety of industries. Almost all of the case studies are real-world situations taken from my consulting practice or from research. Feedback from my colleagues who are using the text has provided me with fruitful criticism, most of which has been incorporated into the twelfth edition.
The majority of the articles on project management that have become classics have been referenced in the textbook throughout the first eleven chapters. These articles were the basis for many of the modern developments in project management and are therefore identified throughout the text.
Many colleagues provided valuable criticism. In particular, I am indebted to those industrial/government training managers whose dedication and commitment to quality project management education and training have led to valuable changes in this and previous editions. In particular, I wish to thank Frank Saladis, PMP, for his constructive comments, recommendations, and assistance with the mapping of the text to the PMBOK®Guide as well as recommended changes to many of the chapters. I am indebted to Dr. Edmund Conrow, PMP, for more than a decade of assistance with the preparation of the risk management chapters in all of my texts. I am also indebted to Dr. Rene Rendon for his review and recommendations for changes to the chapter on Contract Management.
To the management team and employees of the International Institute for Learning, thank you all for twenty-five years of never-ending encouragement, support, and assistance with all of my project management research and writings.
Harold Kerzner
The International Institute for Learning
2017
Note
PMBOK is a registered mark of the Project Management Institute
1Overview
1.0 INTRODUCTION
In the United States, the roots of project management date back to the Department of Defense (DOD) and heavy construction companies during the 1960s. Early use of project management focused on the completion of unique, or sometimes repetitive, projects with a heavy focus on compliance to budgets and schedules. To maintain standardization and control in the way that projects were managed, DOD established policies and procedures for gate reviews and the way that status should be reported.
In the early years, project management was seen as a part-time job rather than as a career path position. In many companies, project management existed in only a small portion of the business, which made it difficult for some projects to get total company support.
Executives began realizing the complexities of resource control and effective project staffing. In addition, the rapid rate of change in both technology and the marketplace had created enormous strains on existing organizational forms. The traditional structure, which was highly bureaucratic, showed that it could not respond rapidly enough to a changing environment. Thus, the traditional structure was replaced by project management, or other temporary management structures, that were highly organic and could respond very rapidly as situations developed inside and outside the company. The organic nature of project management practices today allow project managers to customize the project management tools and processes to adapt to a variety of different environments.
The acceptance of project management was not easy. Many executives were not willing to accept change and were inflexible when it came to adapting to a different environment and flexible organizational structures. The project management approach required a departure from the traditional business organizational form, which was basically vertical and which emphasized a strong superior–subordinate relationship. Many executives had very strong beliefs as to how a company should be run and refused to recognize or admit that project management could benefit their company.
Unfavorable economic conditions forced executives to reconsider the value that project management could bring to a firm. Some of the unfavorable conditions included the recessions of the late 1970s and early 1990s, the housing crisis that began in 2008, the European economy downturn in 2013 and 2014, and the world economic slowdown in 2015. These unfavorable conditions emphasized the need for better control of existing resources, the creation of a portfolio of projects that would maximize the value brought to the firm, and a higher percentage of project successes. It soon became apparent that project management could satisfy all of these needs and that project management is a necessity in both bad and good economic conditions. Today, the concept behind project management is being applied in such diverse industries and organizations as defense, construction, pharmaceuticals, chemicals, banking, hospitals, accounting, advertising, law, state and local governments, and the United Nations.
Almost all of today’s executives are convinced that project management can and does work well. Project management is now being applied to all facets of a business rather than just parts of the business. Projects are now being aligned with corporate or strategic objectives. Simply stated, “Why work on a project that is not aligned to strategic objectives with the goal of creating business value?” In some companies such as IBM, Microsoft, and Hewlett-Packard, project management is recognized as a strategic competency necessary for the survival of the firm. This recognition of the importance of project management today permeates almost all industries and companies of all sizes.
1.1 UNDERSTANDING PROJECT MANAGEMENT
PMBOK®Guide, 6th Edition
Chapter 1 Introduction to the PMBOK®Guide
1.2.1 Projects
1.2.1 The Importance of Project Management
1.2.4.5 Project Management Process Groups
In order to understand project management, one must begin with the definition of a project. A project can be considered to be any series of activities and tasks that:
Have a specific objective, with a focus on the creation of business value, to be completed within certain specifications
Have defined start and end dates
Have funding limits (if applicable)
Consume human and nonhuman resources (i.e., money, people, equipment)
Are multifunctional (i.e., cut across several functional lines)
The result or outcome of the project can be unique or repetitive, and must be achieved within a finite period of time. Because companies have very limited resources, care must be taken that the right mix of projects is approved. Given this, another outcome of a project is that it provides business value to the company as opposed to being a “pet” project for the personal whims of one person.
Project management is the application of knowledge, skills, and tools necessary to achieve the project’s requirements. The knowledge, skills, and tools are usually grouped into activities or processes. PMI’s PMBOK ®Guide identifies five process groups. Some of the activities within these groups include:
Project initiation
Selection of the best project given resource limits
Recognizing the benefits of the project
Preparation of the documents to sanction the project
Assigning of the project manager
Project planning
Definition of the work requirements
Definition of the quality and quantity of work
Definition of the resources needed
Scheduling the activities
Evaluation of the various risks
Project execution
Negotiating for the project team members
Directing and managing the work
Working with the team members to help them improve
Project monitoring and control
Tracking progress
Comparing actual outcome to predicted outcome
Analyzing variances and impacts
Making adjustments
Project closure
Verifying that all of the work has been accomplished
Contractual closure of the contract
Financial closure of the charge numbers
Administrative closure of the paperwork
Successful project management can then be defined as achieving a continuous stream of project objectives within time, within cost, at the desired performance/technology level, while utilizing the assigned resources effectively and efficiently, and having the results accepted by the customer and/or stakeholders. Because each project is inherently different and each customer can have different requirements, the activities included within the process groups may change from project to project. The PMBOK ®Guide identifies industry-accepted activity regarded as best practices for each process group and these best practices can be structured to create a project management methodology that can be applied and customized to a variety of projects.
The potential benefits from effective project management are:
Clear identification of functional responsibilities to ensure that all activities are accounted for, regardless of personnel turnover
Minimizing the need for continuous reporting
Identification of time limits for scheduling
Identification of a methodology for trade-off analysis
Measurement of accomplishment against plans
Early identification of problems so that corrective action may follow
Improved estimating capability for future planning
Knowing when objectives cannot be met or will be exceeded
Unfortunately, the benefits cannot be achieved without overcoming obstacles such as project complexity, customer’s special requirements and scope changes, organizational restructuring, project risks, changes in technology, and forward planning and pricing.
Project management is designed to make better use of existing resources by getting work to flow horizontally as well as vertically within the company. This approach does not really destroy the vertical, bureaucratic flow of work but simply requires that line organizations talk to one another horizontally so that horizontal and vertical work flow will be accomplished more smoothly throughout the organization and in a concurrent manner. The vertical flow of work is still the responsibility of the line managers. The horizontal flow of work is the responsibility of the project managers, and their primary effort is to communicate and coordinate activities horizontally between the line organizations.
PMBOK®Guide, 6th Edition
3.4 Project Management Competence
Figure 1–1 shows how many companies are structured. There are always “class or prestige” gaps between various levels of management. There are also functional gaps between working units of the organization. If we superimpose the management gaps on top of the functional gaps, we find that companies are made up of small operational islands that refuse to communicate with one another for fear that giving up information may strengthen their opponents. The project manager’s responsibility is to get these islands to communicate crossfunctionally toward common goals and objectives.
FIGURE 1-1. Organizational gaps.
The project manager may require a difference set of skills when working with each of the islands. The PMBOK ®Guide identifies a talent triangle composed of technical project management, leadership and strategic and business management skills. In today’s environment, strategic and business management skills are getting more attention because project managers are seen as managing part of a business rather than merely a project and, as such, are expected to make both project and business decisions.
The following is an overview definition of project management:
Project management is the planning, organizing, directing, and controlling of company resources for a relatively short-term objective that has been established to complete specific goals and objectives. Furthermore, project management utilizes the systems approach to management by having functional personnel (the vertical hierarchy) assigned to a specific project (the horizontal hierarchy).
PMBOK®Guide, 6th Edition
2.4 Organizational Systems
The preceding definition requires further comment. Classical management is usually considered to have five functions or principles:
Planning
Organizing
Staffing
Controlling
Directing
You will notice that, in the definition, the staffing function has been omitted. This was intentional because the project manager does not staff the project. Staffing is a line responsibility. The project manager has the right to request specific resources, but the final decision as to what resources will be committed rests with the line managers.
We should also comment on what is meant by a “relatively” short-term project. Not all industries have the same definition for a short-term project. In engineering, the project might be for six months or two years; in construction, three to five years; in nuclear components, ten years; and in insurance, two weeks. Long-term projects, which consume resources full-time, are usually set up as a separate division (if large enough) or simply as a line organization.
Figure 1–2
