Module: Project Management Techniques

Unit: Project Overview

Lesson: Key Project Planning Principles
Key Project Planning Principles

Introduction

This section presents an opportunity to refresh your memory on project management concepts you will have learned
on the 'Management of Projects' module. Make sure you fully understand these basic project management concepts
before proceeding with this module.

In this lesson we will investigate the key project planning principles. These are the essential elements in starting any
project and are important to understand.

The first part of the lesson will examine the importance of determining the purpose of a project and the need to plan
any project. We will also understand the scope and the Triple Constraints and how this needs to be incorporated into
the planning of a project.

In the latter section of the lesson we will investigate the different types of project organisation which can be utilised in
planning a project.

Purpose

The purpose of project planning is to develop a plan that enables the project to be executed and controlled.

It is essential that any project manager determines and understands the purpose of the project prior to commencing
project planning. The purpose will enable the project manager to understand the outcomes required from the project
and will also allow the project manager to make decisions throughout the project.

Think of a project in which you have been involved.

1. Consider the purpose of the project and write it down.

2. Do you believe the project achieved the purpose ?

3. Think of a time when a difficult decision needed to be made or a risk had to be overcome. Did the purpose of
the project aid the project manager in making a decision ?
The purpose will be broken down and fully explained in the Project Plan which we discuss further in the next lesson.
The Need to Plan

Planning involves both the planning of project management activities (e.g. development of project plan, planning project
reviews, planning for risks etc) as well as the planning of technical activities (e.g. technical reviews, quality assurance,
estimating etc). The culmination of the planning processes is the Project Plan, which serves to guide project execution
and control. Clearly an important part of planning is defining the project baselines; the approved constraints within
which a project must operate. But what else is required in planning?

It is often said that the more time you devote to planning the more successful your project is likely to be.

The greatest need for planning is at the beginning of the project. But remember you don't get it right first time. Plan to
have to refine your plan during the execution phase of the life-cycle!

Remember:

Recognise the importance of planning and the effort required. Avoid the temptation to commence project execution
until sufficient planning has been carried out.

Good project managers think of worst case scenarios and what can go wrong. You should not use optimistic
parameters (e.g. estimates of effort) when planning.

Think about your workplace experience of projects. What questions does project planning seek to address.
Planning is an on-going process - not performed once and for all. It is an iterative process that progressively refines the
plan.

Time, Cost & Performance/Performance

The key objective of planning is to establish what is known as the triple constraints of the project; performance, cost
and time.

Baselines or the Triple Constraints of scope/performance, cost and time are the key constraints within which the
Project has to perform. The triple constraints are inter-related. For example, if the requirements baseline changes due
to an enhancement of functionality that is approved, this will invariably impact schedule and cost; thus necessitating a
schedule and cost baseline change.

Figure 1.01 - Importance of Baselines

You will have come across the term 'baseline' many times before. Can you define what it is, and elaborate what the
scope/performance, cost and time baselines refer to ?

The baselines, or the triple constraints, are the three targets that the Project Manager should work towards achieving.
The principle role of the Project Manager is to manage the triple constraints of project scope (or specification), project
schedule and project cost. These triple constraints are referred to as the project baselines, and should be managed to
the satisfaction of the client and project sponsor

The Triple ConstraintsPlanning sets out the systematic course of actions (method, scheme etc) to establish
and then to define how the triple constraints of project management will be managed.

Figure 1.02 - Triple Constraints of Project Management

The triple constraints are also known as the project performance baselines and consist of:

1. Scope/Performance

2. Cost

3. Time

Scope/Performance

The scope/performance of a project is a specific and clear statement concerning what has been agreed to be
performed or achieved in a project. The scope explains the functions, features, data, content that will be included in the
project to ensure it meets its purpose.

Cost

The cost of a project is about what needs to be given to a project in terms of money and effort to ensure the project
can happen. This could be resources like humans, materials, equipment, property etc that need to be secured to
achieve a project outcome in line with its purpose.

Time

The amount of time required to complete each element of a project must be analysed and agreed. By determining this
we are able to estimate the duration of the project together with how much resource needs to be allocated to the
particular project.
Think of three projects in which you have been involved which focused predominantly on either scope/performance,
cost and time.
Establishing and controlling the baselines is the most important task for the Project Manager. Without baselines,
scope creep occurs; resulting in loss of project control and the project is doomed to failure.

During planning not only must the baselines be defined, but also the change management process is defined. A major
role of the project manager is the prioritisation of the Triple Constraint. This can only be done by communicating with
the stakeholders of a project and negotiating an agreement. Stakeholders are discussed further in the third lesson.

Regardless of whether the stakeholders already understand project management or have ever heard of the Triple
Constraint, they will already know, or have an idea, what is most important to them. The role of a project manager is to
discuss these with the stakeholders and gain agreement. This will be achieved by asking them a number of well-
worded questions.

Using the three projects you identified earlier, think about how the project manager determined the levels of the Three
Constraints.

Organisational Structures

Whatever the organisational context, a project will have its own structure, with the Project Manager reporting to the
project Steering Group and project teams reporting to the Project Manager. The actual project structure, in terms of
the particular teams, and number of teams, will depend on the characteristics of the project. Also smaller projects and
projects carried out within a functional setting will probably not have a separate project Administrator. Instead the
Project Manager will address administrative tasks.

Figure 1.03 - Project Structure

You will have come across the project structure in the module on 'Management of Projects'. Can you describe the
role of the various parties in the project structure?
Projects can be conducted in:

1. Functional organisations

2. Projectised organisations

3. Matrix organisations

The most common structure for companies that undertake projects on behalf of Clients is the matrix model. Global
organisations tend to adopt a matrix model with responsibilities shared between the product/services divisions and
geographical units. The global matrix organisation aims to balance global efficiencies with local/customer
responsiveness.

Projects are carried out in a number of organisational settings and each have their own pros and cons. But some
structures are better suited to project-based working than others.

Functional Structure

Functional structures are adopted by many of the traditional engineering and manufacturing companies. They are fairly
hierarchical in structure with each employee having one clear boss.

Figure 1.04 - Functional Structure

Functional organisations do undertake projects, but the project profile is low. Usually the projects are undertaken
within one functional unit, e.g. a design project undertaken within the engineering department. Such project work does
not benefit from cross-functional collaboration and integration. Project team members are also not assigned on a full-
time basis to the project.

The authority of the Project Manager is very low (or in some cases none) in functional organisations.
Projectised Structure

Projectised structures are fairly rare. They are adopted by companies such as architectural firms, where the majority of
staff are engaged in project work. Usually project work for an external client.Projectised structures are organised
purely by project teams with each team being self-sufficient (in administrative and support functions).

Figure 1.05 - Projectised Structure

In a projectised structure, team members have a one-boss reporting structure, reporting to the Project Manager.

The Project Manager has a high degree of authority and autonomy.

The matrix organisational structure is in-between functional and projectised. The project team is made up of team
members taken from the various functional units (as shown above, from production, R&D, sales, marketing etc). Team
members have to adapt to a two-boss situation - reporting to their functional manager as well as reporting on project
matters to the Project Manager.

Figure 1.06 - Matrix Structure

There are many shades of matrix organisations. Some where the project manager has a high degree of authority
(known as strong matrix), and at the other end of the spectrum where project managers have limited authority (known
as weak matrix).Today projects are frequently undertaken within a matrix structure. Given the focus on project-based
working, organisations are increasingly transforming themselves into strong matrix organisations.
In a strong matrix organisation the Project Manager has a high degree of authority. Many services companies that
undertake significant project work for external clients operate within a strong matrix structure.
Many global organisations, such as IBM, HP/Compaq, Accenture, adopt a matrix model with responsibilities shared
between the product/services divisions and geographical units. They operate projects across the matrix, and this
inevitably means project team members report to more than one boss.

The global matrix organisation was devised to balance global efficiencies with local responsiveness. Global
efficiencies such as shared infrastructure, processes, synergies and leverage. However, there are many complexities
and challenges associated with this model.

Discuss the level of authority of a Project Manager in such a global, matrix organisation.

Identify the top challenges of managing projects in such an environment, and suggest how these problems can be
overcome?