Managing Human Resources in Projects Unit 3

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Unit 3 Assessing Individual competencies

Structure

3.1 Introduction
Objectives
3.2 Project Management Competencies
Self Assessment Questions: 1
3.3 Time Management
Self Assessment Questions: 2
3.4 Cost Management
3.5 Human Resource Management
3.6 Risk Management
3.7 Contract Management
3.8 Communication Management
3.9 Scope Management
3.10 Quality Management
3.11 Summary
3.12 Terminal Questions:
3.13 Answers to SAQ’s and TQ’s

3.1 Introduction
The competencies required for a project organization must aim at achieving certain
specific goals which in turn helps the manager to achieve overall project goal. It involves
making tradeoffs between several factors responsible for making a project a successful
one in the organization. Such factors include scope, time, procurement, cost etc. It is
inevitable in a project life cycle that there will be changes to the scope, time or cost of
the project. However where most projects fail is that when one of the factors change and
appropriate adjustments are not made to the other areas. For example, if a deadline is
moved up, necessary actions should be taken by the project manager with regards to
cost or scope to ensure the deadline is met without compromising the quality of the
product.

Objectives:
 To know the basic competencies required for a project manger
 To understand the importance of core functions in executing a project
 To learn the about facilitating competencies for the success of a project
 To learn about the key strategies to make the project successful
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3.2 Project Management Competencies

A successful project management tries to achieve the following key knowledge areas or
competencies in the organization. Successful project management requires that all
knowledge areas (scope, time, cost, quality, human resource, communications, risk,
procurement, project integration) be managed effectively. Some of the items that came
out of the reviews are directly related to the above knowledge areas, areas of which
there needs to be improvement.

Following are the key knowledge areas of competencies helping in succeeding in a

project which are depicted in the following diagram.
 Time Management
 Cost Management
 Human Resource Management
 Risk Management
 Contract Management
 Communication Management
 Scope Management
 Quality Management

Core functions

Scope Time Cost Quality

mgt mgt mgt mgt

Share
Holder’s
needs & Project Integration Management Tools Project
expectati & Tech success
ons

HR mgt Risk Comm. Contract

mgt Mgt mgt

Facilitating functions

Self Assessment Questions: 1

(1) The following are some of the competencies required for Project
Management.
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A. Human Resource Management

B. Scope management
C. Quality Management
D. All of the above

3.3 Time Management

It is the process of estimating how long it will take to complete work, develop project
schedule, and ensure completion. Project Schedule for each project a project schedule
should be defined early on. Tasks should be identified down to the task/person level.
Project schedule templates (plans for software upgrades, software development etc…)
should be developed so that project managers have a ―pool‖ to pull from. Some of the
strategies for effective Time management in executing any project are:

 All projects that have more than 5 resources and have duration of longer than 1
month should utilize Microsoft Project to develop a project schedule.
 Requirements should be done prior to development work.
 In areas where business changes are needed, significant time should be allotted
to do this.
 Include entire project team in planning. This will help minimize tasks being
overlooked in the plan.
 Break the project into small pieces. Not all functionality has to be delivered with
one release.
 Time needed for the project by the various resources needs to be better
identified. Often the time is underestimated.

The cost estimate of a project is made by first making a morphological breakdown of the
project, estimating each component and then summing up the component estimates-to
arrive at the overall cost estimate. Time estimate, on the other hand, is made by making
a work breakdown of the project, estimating the time schedules for each work, putting
them in proper sequence, i.e. in series or parallel, as per technical or any other logical
manner and finally matching their build-up on a time scale with the available resources.
The total stretch on the time scale corresponding with the resources sets the target.
Thus, it is not a summing-up process; rather it is a manipulating process. Therefore, time
is not merely what-it takes to do work; it will also be governed by how much time we
want the work to take.

The estimated time for the completion of a project is dependent not only on the work
content or the sequence; it will also be influenced by resources and constraints. The
basic factors, i.e. work, constraints and resources are again dependent on the data

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available. Obviously we cannot have all the data needed at the beginning of the
project—the data will get defined/ refined successively with the progress of the project.
In practice, therefore, instead of trying to accurately estimate the duration, a reasonable
duration is allocated and commitment obtained from the agency who will be held
responsible for implementation. If the duration is not acceptable to any agency, then it
may be changed.

The best completed project of the past, either in the same industry or in allied
technological area, with a cut in the time estimate to induce challenge could provide the
reasonableness one would be looking for in this case. Estimating time duration,
therefore, reduces people to binding to time durations.

Self Assessment Questions: 2

(1) The competence of Time Management involves
A. Prioritization
B. Planning
C. Requirements Analysis
D. All of the above

3.4 Cost Management

Due to the wide spread growth of industrial enterprises and task oriented business
approaches, it became the primary responsibility of every organization to look for better
ways and means to achieve their cost objectives. An organization based on the task it
takes can strategy its activities to achieve early projects depends on their cost
management.

Cost management involves Preparing and managing a budget. Budget guidelines need
to be established prior to project. It helps in determining who has the authority to make
certain budget decisions. A good cost management is one which achieves the objectives
of cost control and cost reduction and brings all advantages of costing to the project
organization.

A budget identifying the total cost of ownership of an application should be developed.

Some costs that need to be identified and budgeted for are:
 Consultants: As we continue to purchase more applications, our dependency
on consultants will continue. This needs to be budgeted as a recurring cost
with each upgrade.
 Maintenance agreements will be a recurring cost of owning purchased
applications.

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 Travel and professional development: the skills needed to support these new
applications require staff to learn new technology as well as develop
partnerships with other institutions utilizing the same software. This is a
recurring cost and should be budgeted for accordingly.

Self Assessment Questions: 3

(1) The competence of cost management involves
A. Budgeting
B. Knowledge of technology
C. Knowledge of English
D. All of the above

3.5 Human Resource Management

Project manager does not need an intimate knowledge of and to be skilled in working
with the technology involved, he or she does need to have sufficient knowledge to know
what questions to ask, how to interpret the answers, and whether he or she is being
given the technical information needed to make a management decision. It means
making effective use of people.

 Knowledgeable resources should be identified for the project team and involved
as soon as possible. If staff is unable to devote time necessary, then tasks
should be prioritized.
 End users should be involved early in the project and updated throughout.
 If a project requires some special skills (i.e. knowledge of SQL etc..), staff need
to have the training made available at the right time. This may be something that
should be included in the project plan – training assessments of project team.
 Staff should be given release time for participating in projects spanning a long
time or requiring significant staff effort.
 Clearly define staff roles and responsibilities

3.6 Risk Management

It involves identifying, analyzing, and responding to risks. In project management a risk
is some future happening that results in a change, either positive or negative, to the
project. For the most part, risk is associated with loss, at least in the traditional sense,
Loss can be estimated, and the estimate is a combination of two factors:

 The Probability that the event will occur

 The severity of the loss if the event occurs.

Note: Newer risk theories deal with entrepreneurial risk where there is not only a
probability of loss, but a possibility of gain; this is common in business where capital is
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put at risk in order to fund a few business volumes. For the most part, in this book we
deal with risk in the traditional sense where risk is the possibility of loss.

Risk management is a broad and deep topic, and we are only able to brush the surface
in this book. A number of reference books on the topic are available. The bibliography in
Appendix B lists some specific titles you can use as reference. Risks need to be
identified prior to project. In addition, procedures on how to handle these risks if they
arise need to be documented. Staff turnover will most likely occur on projects spanning a
long time. A management plan needs to be devised on how new staff will be brought up
to speed.

To establish the risk management for the project, the project manager and project team
must go through several processes. The first is identifying risk.

In this part of the process the entire team is brought together to discuss and identify the
risks that are specific to the current project. We recommend that the meeting focus
solely on risk. A meeting with such a single focus lets the entire project team know how
important risk management is and gets every one thinking about the various risks
involved in the project.

As mentioned there are two major factors in assessing risk. The first one is the
probability that the risk event will occur. For instance, if a project involves migrating
legacy systems to new systems, the interface points between the tow are often where
problems occur. The professional project manager will have a type of good sense of
these types of risks and chances they will occur.

When the team puts together the risk identification list, nothing should be ruled out at
first, Let the team brainstorm risk without being judgmental. The team will put up some
risks with small probabilities. Those risks are so small that you can ignore them. For
instance, the risk that a meteor will destroy the building in which you work is miniscule. If
you are worrying about things like that meteor, you wont be much of a project manager.
It is the risks that actually might occur that you manage.

The second part of risk assessment is the impact the risk will have on project .If a risk
has probability of 50 percent that it will occur, you need to assess what the impact will
be, because a 50-50 chance of something happening is fairly high, If however, the risk
event has a low impact rating you won’t need to manage it. This information should also
be discussed at the first risk meeting.

To give a numerical score for a risk event, you simply multiply the probability of the risk
occurring times the impact that the event’s occurrence would have. While at first glance

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this seems to be a rigorous mathematical process, it is not the probability of a

occurrence is subjective to a great extent, as the impact of the event, you should get
advise from the team on both the probability of occurrence and the impact risk will have
on the project, but in the end your experience and good dose of common sense will give
you a good start on handling the risk.

The next step in risk management is to plan, as much as possible, the responses that
will be used in the event that the identified risks occur. For instance you may want to
include a clause in your hardware contract with the vendor that if the servers don’t get to
you by a certain date, they will pay a penalty. This penalty gives the vendor an incentive
to perform and mitigate the risks. Involved in the late delivery of key equipment, for all
the risks listed in the risk identification that you choose to act upon, you should have
some type of action in mind. It is not enough simply to list the risks you need to plan to
do something about the risk events if they occur.

3.7 Contract Management

Reporting System Feedback communication can also be organised and obtained by
issuing appropriate directions. Thus, when a work is contracted out, along with many
other issues, the feedback requirement too can be clearly spelt out in the contract. No
doubt in this way only the major requirements can be spelt out, but that itself will go a
long way in improving the management of a project. The periodic feedback reports that
any contractor would be asked to furnish may relate to:

• Drawings and documents to be prepared

• Equipment and materials to be procured
• Equipment to be manufactured at shop
• Equipment to be fabricated at site
• Erection and commissioning work

The contractor in the first instance may be asked to communicate what has been done,
what problems are being faced, and what is his forecast for the completion of the task
assigned to him. Each of these reports can be made in two parts—the first part can list
the total work with scheduled dates, etc.; the second part can report the status as on the
date of reporting. As a project manager, you will always have projects for which you
must procure hardware, software, or services from outside sources. This process is
procurement, and the professional project manager must have a basic understanding of
the procedure so that he or she can make sure that the organization is getting the right
materials at the best cost. To manage procurement, you need to go through a few
processes,

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Selecting Vendors
Before you even start reading the responses to your proposal, set the standards for
choosing a given vendor. These criteria may be technically based, experienced based or
cost based but whatever basis you use for choosing a vendor. It must remain the same
for all the vendors, If you are pubic company, every vendor you have turned down will
ask for a copy of the winning bid. If they think they have a better bid, the project may end
up in legal tangles. If, however, you have a standards chart, you can point out every one
as rated with the same criteria and that the winner had the best overall number. By
determining your criteria and that the winner had the best overall number, by
determining our criteria for choice early in the process, it is easier to make decisions and
then to defend it if need be.

Specifically, in the case where the application is to be written solely by the vendor, the
project manager's primary job is contract management. Contract management involves
the following:

■ The vendor must supply you with deliverable dates so that you can tell if
the project is on time.
■ The vendor should also supply a Work Breakdown Structure detailing how the
vendor decomposes the scope of the project and showing the tasks that make up
the completion of a deliverable.
■ There should be regular status meetings to track progress. This meeting should
be formal and should occur on specified dates. The status meetings should occur
at least once a week, although in the early stages of the project, we may choose
to have them more often. The weekly status meetings give an idea of how the
vendor is proceeding in fulfilling the contract, and by having them at the weekly
intervals, we won't allow the project to get very far off course. We can correct a
week's worth of problems; anything longer than that starts making problems
unmanageable.

In the contract, we should state who the contract manager will be for the organization. In
most of the organizations, contract management functions are handled by a specific
department or team. It would be preferable for contract management to be in the hands
of the project manager, or at least to have the project manager as part of the contract
management team.

Closing out the contract is often an overlooked function of the project manager. It both
certifies what has been done and gives all parties a chance to deal with open issues and
final payments. The professional project manager will be aware of all of the steps that
must be followed in the procurement process even though he or she may not be the
person directly responsible for managing them. This is just another part of being a
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project management professional. Consider the following as you bring a contract to a

close:

Lack of a clear understanding when the project is finished is a plague that permeates IT.
When we write the (Request for Proposal) RFP , we should state clearly how the project
finishes and what the final deliverable is. Failure to do this will almost always lead to cost
overruns in the form of maintenance activities under the heading of project work. State
what the final product of the project is to be, who is to determine if it has been delivered,
and what is to be done with any open issues.

After the contract is closed, make sure you file all of the materials used during the
project. These materials include the original RFP, the project baseline, the scope
statement, the (Work Breakdown Structure) WBS, the various plans used to manage the
project, and all changes, including those that were requested but turned down. You also
need to show all payments and make sure that any subcontractors on the project were
paid. Confirming that subcontractors have been paid is done through the vendor, who
must show that all payables to subcontracts have been made.

By the time you leave, both you and the manufacturer have stated your positions and
know that the other party understands your position. While the example is simple, it does
establish a language between you and the provider, and both of you understand the
situation. The seeds have been planted for a continuing dialog. As the project work
progresses, there will be changes that can be dealt with effectively because the effort
has been made up front to understand each other.

The next step in the (Condition of Satisfaction) COS process is to negotiate to closure on
exactly what will be done to meet the request. Obviously, some type of compromise will
be negotiated. The final agreement is documented in the (Project Overview Statement)
POS .

Our example was fairly simple. More than likely, the parties will not come to an
agreement on the first pass. This process repeats itself until there is an agreed-to
request that is satisfied by an agreed-to response. As part of this agreement there will be
a statement, called success criteria, in the POS that specifies when and how the request
will be satisfied. It is important that this statement be very specific. Do not leave whether
or not the conditions have been met up to interpretation. An ideal statement will have
only two results-the criteria were met or the criteria were not met. There can be no in-
between answer here. The success criteria (aka doneness criteria) will become part of
the POS. The result is documented as the COS and becomes input to the POS.

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This early step of establishing and agreeing to what will be done is very important to the
success of the project. It is difficult to do a thorough job, especially when everyone is
anxious to get to work on the project. It is also a painful process. People can be
impatient; tempers may flare. You may be inclined to skip this step. Remember, pain me
now or pain me later. You choose what you are willing to live with. Even if the request
seems straightforward, do not assume that you understand what the requestor has
asked or that the requestor understands what you will provide, even if the request seems
straight forward. Always use the COS to ensure that you both understand what is
expected.

Once the contract is signed and the vendor begins to deliver the contracted work,
contract administration for that vendor has begun. Contract administration is the
responsibility of the project manager. Our general advice is to have the contract spell out
in detail exactly how business will be done—not a detailed list of what will be done for
every possible occurrence during the contract period, but rather clear guidelines that
everyone understands. The guidelines might include obligations, responsibilities,
performance goals and deadline dates, penalties for missed dates/ rewards for early
delivery, status reporting dates, problem discovery, escalation and resolution, change
management procedures, milestone dates, project status meeting dates, acceptance
test criteria, cancellation conditions, cancellation policies, and closing criteria.

Contract Cancellation
The contract should clearly spell out the conditions under which the contract may be
cancelled. For example, can either party cancel for any reason by simply notifying the
other according to a defined procedure? Or does cancellation require both parties'
mutual agreement? Cancellation will often be the result of performance not meeting
expectations.

Contract Closing
Once the acceptance criteria have been met, a series of events occurs. These are
generally debriefing sessions and handoffs of deliverables and documentation. A final
payment to the vendor is commonly withheld pending receipt of these items.

3.8 Communication Management

For ongoing directions a two-way communication system is essential. For that" matter,
the entire process of direction, coordination and control in a project revolves around
communication. Two-way communication shows the direction which leads to
coordination and control, direction all around. Such being the importance of
communication, is often concluded that projects are run by communications. In fact,
according to Peter Drucker 60 %of management problems are caused in whole or in part
by faulty management communications.
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For effective communication, the process of communication must be understood.

Communication does not mean merely passing on a message—top-down or bottom-
up—it includes understanding of the message sent by the recipient, as intended by the
sender. If the message sent by the sender has not been understood by the receiver as
was intended, no communication has taken place.

Thus, when two-way communications are being talked of mere provision of channels for
both top-down and bottom-up message transmission is not enough; there has to be
genuine effort on the part of the sender to check and verify by obtaining feedback if the
message has been received and interpreted as it was intended. The receiver, similarly,
should seek clarification and confirmation of his understanding for effective
communication. Yet, in real life this simple point is often ignored.

A drawing is sent but the sender may not care to check if it has been received and could
be put to use. The sender may even send the wrong drawing or send a drawing with so
many 'holds' that no work at all can be taken up at the site. The site could add to the
communication gap by remaining silent about the same. Thus, a message sent is not
always a message received and silence neither signifies its receipt nor its
understanding.

The Americans have an interesting way of communicating. When one person asks
another what he thinks about an issue, the respondent would invariably repeat the
question first before making any reply. This example is not meant to illustrate how to
communicate but it highlights one basic point—that communication starts when the
parties try to understand each other.

Communication, thus, has two dimensions—physical and mental. Passing a memo,

drawing, data, instruction, information, etc. are the physical aspects of communication;
understanding the same in the light of role expectation, empathy, preconceived notions,
language barriers, listening skills, etc. are the mental aspects of communication. While
physical aspects of communication can be easily achieved, the mental aspects often
present barriers to communication. Perfect communication, therefore, requires a
conscious and determined effort.

The first step for speedy project management is, therefore, to ensure that
communication takes place freely. Departmentalisation, chain of command, levels,
distance, etc, should not be allowed to stand as barriers to communication. While
instructions must flow through a chain of command, information flow should not have
any such restriction. The project manager could make this point clear at the very
beginning of the project.

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Physical distance between the interacting groups would always present barriers to
communication. One may work within the same office but by shutting oneself within a
cabin a physical distance can be created. A physical distance can also be created by
making oneself unapproachable even in an open working area. Barring this last problem,
many communication problems can be avoided if the interacting groups could be made
to sit together in the same office space.

In the beginning of the project itself communication devices like telex, telephone,
hotlines, and courier services should be established even where usual postal services
exist. Facilities to visit site through rail, road, air or helicopter, may be established to
ensure physical closeness which is so essential for good communication.

Effective communication in a project would require a communication-oriented action

plan. The actions that may be taken in this regard are as below:

1. Organisation of work, people and work place with communication orientation

2. Selection and installation of appropriate communication devices
3. Project review and coordination meetings at predetermined frequency
4. Predetermined document distribution matrix
5. Establishing healthy attitude towards communication by appropriate directions
6. Installing structured reporting systems
7. Implementing routine communication systems and procedures
8. Establishing a control room
9. Running an in-house magazine
10. Using desk-top computers for communication

It can very well be appreciated that if the provision for feedback is made in the process
of communication. It helps in avoiding serious problems that may occur at a later stage.
Thus, if order acceptance is not received, the vendor may ask for extra price or refuse to
adhere to certain specifications by simply referring to the fact that the purchase order
terms and conditions were not accepted by him. Similarly, an item may be manufactured
as per the drawing which has not been approved by the engineer. It will be disastrous for
the project to assume that directions have been received, understood and are being
implemented as per intent without this feedback communication.

3.9 Scope Management

Defining and managing all the work required to successfully complete the project.
 Charters should be developed for each project.
 A formal process should be developed for change management including the
estimate in cost of making the change.

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 Scope of the project needs to be clearly defined in the project charter. To avoid
scope creep, any changes to scope must be documented and a formal approval
must be obtained before changing the scope of the project.
 Need to determine who can make decisions and differentiate based on
magnitude of decision. Not every project decision should go to the Steering
Committee.

3.10 Quality Management

It ensures the project will satisfy stated or implied needs. In order to meet customer
requirements, and do so on time and within budget, the project manager must
incorporate sound quality management practices. He or she will be concerned with the
quality of the following.

 The product / service/process that is the deliverable from the project

 The project Management process itself.

Continuous quality management: is a procedure that a company can use to improve its
business process. It’s a way of life in those organizations that want to attain and sustain
a competitive position in fast-paced information age industries. Continuous quality
management begins with a definition of vision, mission – critical success factors, and
business process.

Continuous quality management is most evident in those organizations that are

customer driven. Levi Strauss, Motorola and Xerox are but a few. The companies that
have applied for or won the coveted Baldrige Award, an award recognizing exemplary
quality management within the company, are also on the list.

Project Integration Management

Overarching function that affects and is affected by all other knowledge areas.
 Close interaction with vendor is needed to understand changes with new versions
(i.e. what current functionality won’t exist in new version)
 Project Plan should be developed and include:

 Overview of the project - description, sponsors, stakeholders, deliverables

 Organizational structure of the project – authority of project manager and
steering committee, responsibilities and communication for the project,
reporting structure of project
 Management and technical approaches – management objectives, project
controls (status reports, how to handle changes), risk management, project
staffing plan, technology methodologies

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 Scope management plan – WBS (work break-down structure) or high level

task list, key deliverables
 Project schedule – summary and detailed
 Budget – summary and detailed, assumptions
 A project should be broken down into small manageable pieces rather than
implementing everything at once.
 Periodic reviews should occur to determine if the project should continue.

3.11 Summary
Evaluations may be needed to determine if there is additional training that is needed. Be
careful in assumptions regarding knowledge level of the users. Adequate time should be
allowed for training. A common theme in all feedback was that there wasn’t enough time
for testing. Need to identify a ―rule of thumb‖ for project managers to use as a guide.

3.12 Terminal Questions:

(1) What are the necessary competencies for Project Management?
(2) What do you understand by the competence of Risk Management in Projects?
(3) What are the important competencies required for managing contracts in
projects?
(4) Why is the competence of Human Resources Management important for Project
Management?
(5) What do you understand by the competence of Quality Management in Projects?

3.13 Answers to SAQ’s and TQ’s

SAQ 1
(1) D – All of the above

SAQ 2
(1) D – All of the above

SAQ 3
(1) A – Budgeting

Answers to Terminal Questions:

(1) Refer Section 3.1
(2) Refer Section 3.5
(3) Refer Section 3.6
(4) Refer Section 3.4
(5) Refer Section 3.9

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