Reinventing Project Management

Part 1 slides

The Increasing Share of Projects

Projects Operations

Time
1800s Agricultural society 1900s Industrial society 2000s Information society

Industries, Companies, Society

The motivation
The assumption:
Different projects are managed in different ways.

The literature and the discipline assume:

a project is a project is a project.

There is no accepted framework The need:

A framework to distinguish among projects Practical guidelines on how to manage projects in different ways

The Questions
How to Distinguish Among Projects Dimensions? How to Classify Projects on Each Dimension?

How to Manage Different Project Types?

Is There More than One Way?

What Impacts Project Type?

Environment Product Task

Project

UCP

NTCP
Technology

Complexity

Novelty

Pace

UncertaintyComplexity Risk at the moment of project initiation

Complexity size, # of elements, variety, interconnectedness

Uncertainty

Pace Pace available time frame

The UCP Model

Four Dimensions for Distinction Among Project Types

Novelty How new is the product to customers and users
Derivative, Platform, Breakthrough

Technology How much new technology is used

Low-tech, Medium-tech, High-tech, Super High-tech

Complexity How complex is the system and its subsystems

Assembly, System, Array

Pace How Critical is the Time frame

Regular, Fast/Competitive, Time-Critical, Blitz

The Project Diamond - Assessing a Projects Risk/Benefit and Selecting the Right Management Approach

Technology
Super-High Tech

Automatic Bag Handling System

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Airport Construction Project

Time-Critical

Blitz

Pace

Denver International Airport Project

Project Success

Efficiency

Impact on Customer Meeting requirements and specifications Benefit to customer Extent of use Customer satisfaction & loyalty Brand name recognition

Impact on Team Team satisfaction Team morale Skill development Team member growth Team members retention No burnout

Business & Direct Success Sales Profits Market share ROI, ROE Cash flow Service quality Cycle-time Organizational measures Regulations approval

Preparing for Future New technology New market New product line New core competencies New organizational capabilities

Meeting schedule Meeting budget Changes Yield Other efficiencies

Specific Success Measures

Success Dimensions
Preparing for Future

Business & Direct Success

Project Success

Impact on Team

Impact on Customer

Efficiency

Timeframe
Short Medium Long

Timeframes of Success Dimensions

Importance

Preparing for Future Business & Direct success Impact on Customer & Team Efficiency

Low

Medium

High

Uncertainty

Relative Importance of Success Dimensions is ProjectDependent

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

Blitz

Pace

The NTCP Framework

The NTCP Diamond

Definition

Planning

Execution

Termination

Revise Plans

Revise Definition

Classical Project Phases Modified to an Adaptive Iterative Approach

From traditional to adaptive project management

Approach
Project goal Project plan

Traditional project management

Getting the job done on time, on budget, and within requirements A collection of activities that are executed as planned to meet the triple constraint

Adaptive project management

Getting business results, meeting multiple criteria An organization and a process to achieve the expected goals and business results

Planning Managerial approach Project work

Plan once at project initiation Rigid, focused on initial plan Predictable, certain, linear, simple

Plan at outset and re-plan when needed Flexible, changing, adaptive Unpredictable, uncertain, nonlinear, complex

Environment effect Project control

Minimal, detached after the project is launched Identify deviations from plan, and put things back on track

Affects the project throughout its execution Identify changes in the environment, and adjust the plans accordingly

Distinction Management style

All projects are the same One size fits all

Projects differ Adaptive approach; one size does not fit all

Entire Adaptive Iterative Approach

Freeze Requirements

Freeze Design

Requirements

Planning

Specs

Design, Build, Test

Complete

Revise Design
Revise Plans Revise Requirements

Adaptive Approach

Traditional PM

Importance

Preparing for Future Impact on Customer & Team Efficiency Business & Direct success

Project Completion

Time

Relative Importance of Success Dimensions - A Matter of Time

Critical Success Factors

Generic Projects

Product Development Projects

Project Mission Top Management Support Project Planning Project Control Client Consultation Skills Personnel Management Project Communication Client Acceptance Trouble Shooting

Clear and Early Product Definition Defined Product Strategy Early Top Management Involvement High Quality Process Adequate Resources Integrated Planning Empowered and Communicating Team Voice of the Customer

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive Required style Actual style Blitz

Time-Critical

Dr = (Pl, HT, Sy, FC) Da = (Pl, MT, As, FC)

Pace

The FCS Project

Technology

Later design freeze More design cycles

Complexity

Less market data Later requirement freeze

Complex organization Formality

Novelty

Autonomy

Pace

The Impact of the NTCP Dimensions on Project Management

Benefits and risks of high NTCP levels

Dimension Expected benefit Potential risk

Novelty

Exploiting new market opportunities; leapfrogging competition; gaining first mover advantage

Having difficulty predicting exact market needs; missing sales targets; attracting competitors to copy your ideas

Technology

Improving performance and functionality

Experiencing technology failure; lacking needed skills

Complexity

Bigger programs, bigger payoffs

Having difficulty in coordinating and integrating

Pace

Gaining early market introduction, mounting quick response

Missing deadlines; making haphazard mistakes

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

D = (Pl, MT, Ar, FC)

Blitz

Pace

The World Trade Center Project

Reinventing Project Management

Part 2 slides

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

D = (Pl, HT, Sy, -)

Blitz

Pace

The Toy Story Project

Definitions and examples of project novelty

Level of project novelty Definition Examples

Derivative project

Extending or improving existing products or services

Developing a new version of a personal computer; upgrading a production line; streamlining organizational procedures

Platform project

Developing and producing new generations of existing product lines or new types of services to existing markets and customers

Building a new automobile generation; developing a new aircraft; creating a new generation of a cellular system

Breakthrough project

Introducing a new concept, a new idea, or a new use of a product that customers have never seen before

The first enterprise resource planning (ERP) package; the first photostatic copying machine (Xerox); the first Walkman; the Segway personal transportation system

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Br, HT, Sy, -) Da = (Pl, HT, Sy, -)

Blitz

Pace

The Segway Project

Product novelty and project success: Expectations

Success dimensions and possible failure Level of project novelty Derivative
High efficiency is critical; no room for overruns

Platform
Time to market is important for competitive advantage

Breakthrough
Efficiency is difficult to achieve and may not be critical (unless competitors work on the same idea); overruns likely Outstanding improvements in customers life and work

Efficiency

Impact on customer

Gaining additional customers and market segments

Having high strategic impact on customers; retaining previous generation customers Team members gain technical and managerial experience in introducing new-generations.

Impact on the team

Team members extend their experience in quick product modifications.

Team members explore new fields and gain extensive experience in unknown markets

Business and direct

success

Extends life of existing products; additional revenues and cash cow current products

High strategic impact on the business; expectation of years of revenues and building of additional derivatives
Maintaining a strategic position in the market

Long-term, significant business success; may come later after initial products have been tested and refined
Creating new markets and establishing substantial leadership positions

Preparation for the future

Almost none

Impact of product novelty levels on project management

Managerial aspect Derivative (De)
Market data Accurate market data exists from previous products and market research

Level of product novelty Platform (Pl)

Extensive market research and careful analysis of previous generations, competitors, and market trends

Breakthrough (Br)
Unreliable market data; market needs unclear; no experience with similar products; customer base not defined

Product definition

Clear understanding of required cost, features, functionality, etc.

Invest extensively in product definition, involve potential customers in process

Product definition based on intuition and trial and error; fast prototyping to obtain market feedback

Requirements freeze

Early freeze of product requirements, usually before or immediately after project launch

Freeze requirements later, usually at midproject

Very late freeze of requirements, often after prototype feedback

Marketing

Emphasize product advantage in comparison to previous model; focus on existing as well as new customers

Create product image. Emphasize product advantages; differentiate from competitors

Create customer attention through new and innovative marketing techniques; educate customers about potential of product; hidden customer needs; create industry standard

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Pl, HT, Sy, -) Da = (De, MT, Sy, -)

Blitz

Pace

Financial Middleware Software Project

Technology
Super-High Tech

Automatic Bag Handling System

High-Tech

Medium-Tech

Airport Construction Project

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

Blitz

Pace

Denver International Airport Project

Project types based on levels of technological uncertainty

Level of technological uncertainty

Low-Tech

Medium-Tech

High-Tech

Super-High-Tech

Definitions

Uses only existing, wellestablished, and mature technologies

Mostly existing technologies; limited new technology or a new feature

Uses many new, recently developed, existing technologies

Key project technologies do not exist at the time of project initiation

Examples

Construction, road building, utilities, build-to-print

Derivatives or improvements of products; new models in established industries (e.g., appliances)

New systems in a fastmoving industry (e.g., computers, military systems)

New, unproven concepts beyond the technological state of the art (e.g., Apollo moon landing program)

Project characteristics and technological uncertainty levels

Variable
Low-Tech
Development, testing, and prototypes No development; no testing

Level of technological uncertainty

Medium-Tech
Limited development; some testing

High-Tech
Considerable development and testing; prototypes usually used

Super-High-Tech
Need to develop key technologies during project effort; intermediate small-scale prototype Typically three cycles after the final technologies have been selected; late design freeze

Design cycles and design freeze

Only one cycle; design freeze before start of project execution

One to two cycles; early design freeze

At least two or three cycles; design freeze usually at midpoint during second or third quarter

Project reviews

Formal progress and status reviews

Formal progress and status reviews; some technical reviews

Less firm style; readiness to accept some changes More frequent communication; some informal interaction Manager with some technical skills; considerable proportion of academicians 5-10%

Technical reviews with experts in addition to formal progress reviews

More flexible style; many changes are expected

Extensive peer reviews by technical expert teams critical to success

Highly flexible style; living with continuous change; looking for trouble Many communication channels; informal interaction Project manager with exceptional technical skills; highly skilled professionals 2550%

Management style and attitude

Firm style; sticking to the initial plan

Communication and interaction

Mostly formal communication; scheduled meetings Manager with good administrative skills

Frequent communication through multiple channels; informal interaction Manager with good technical skills; many professionals on project team 1025%

Project manager and project team

Contingent resources

5%

Resources
Legend: A- Low-Tech B- Medium-Tech C- High-Tech D- Super High-Tech B: 1-2 Number of design cycles n No. of cycles required to choose the final technologies

D C Planned Resources D: n+3 B A

C: 2-3

B: 1-2 A: 1

Time
Project Initiation Project Scheduled Completion

Possible time ranges for design freeze

Risk area

Possible Time Ranges for Design Freeze, Number of Design Cycles, and Risk Areas for Project Outcomes

Low- and medium-tech versus high- and superhigh-tech projects

Managerial issue

Project type Low- and Medium-Tech

Rigid, no-nonsense, get it done approach

High- and Super-High-Tech

Managerial style

Flexible, ready to accept many changes and tolerate long periods of uncertainty

Project reviews

Formal, top management approval of major phase completion

Formal executive reviews plus technical peer reviews by experts

Saving time by overlapping phases

Phase overlaps possible

Phase overlaps not recommended

Best contract type

Fixed-price

Cost-plus; fixed-price is possible at a later stage of development Spiral development

Development approach

Linear development

Additional concerns

Lower cost, on time

Risk management, systems engineering, quality management

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

D = (Pl, SHT, Sy, -)

Blitz

Pace

SR-71 Blackbird Project

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

D = (Br, SHT, Ar, FC)

Blitz

Pace

Apollo Program

Space Shuttle

The Space Shuttle Program

1969 Initial proposal - to go to Mars in 1980s Encountered low priorities, Were asked to look for low-cost alternatives (August) Program approved; Shuttle only Based on known technologies -success oriented (November) Design freezeconfiguration and technologies First flight scheduled Actual first flight - 60% budget overrun System declared operational Challenger accident Columbia accident

1972

1972
1978 1981 1982 1986 2003

Space Shuttle Program Initial Uncertainties

First two-medium space vehicle First reusable space vehicle Liquid fuel engines and an external tank Huge 75 Ton glider 5000 Miles glide from reentry to landing First orbital flight with a live crew No crew escape system

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Br, SHT, Sy, Re) Da = (Pl, HT, Sy, FC)

Blitz

Pace

The Space Shuttle Program

Space Shuttle Project Management Style

Actual Style
Success oriented Off-the-shelf items Early configuration and design freeze Low flexibility Early operational Limited communication

Alternative Style
Look for trouble Alternative technologies Late freeze; Build a small-scale prototype High flexibility Extended development Intensive communication

Type C High-Tech

Type D Super High-Tech

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

D = (Pl, HT, Sy, -)

Blitz

Pace

The Ford 2000 Project

The three levels of project complexity

Project complexity
Assembly project

Product complexity
Material, component, subsystem, assembly

Examples of projects
Development of a PDA, Post-it notes, design of a single service

System project

System, platform of systems

Missile development, new computer development, new automobile model, a single building construction, restructuring a production plant

Array project

Array, system of systems

English Channel tunnel, national missile defense system, new neighborhood construction, nationwide cellular system

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Pl, MT, Ar, -) Da = (Pl, MT, Sy, -)

Blitz

Pace

The Chunnel Project

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

D = (Pl, HT, Sy, FC)

Blitz

Pace

The Harmony Project

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Br, HT, Sy, TC) Da = (Pl, MT, As, TC)

Blitz

Pace

Mars Climate Orbiter Project

Four levels of pace

Regular

Fast/Competitive

Time-Critical

Blitz

Definitions

Time not critical to organizational success

Project completion on time is important for companys competitive advantage and/or the organizations leadership position

Meeting time goal is critical for project success; any delay means project failure

Crisis projects; utmost urgency; project should be completed as soon as possible

Examples

Public works, some government initiatives, some internal projects

Business-related projects; new product introduction, new plant construction in response to market growth

Projects with a definite deadline or a window of opportunity; space launch restricted by a time window; Y2K

War; fast response to natural disasters; fast response to business-related surprises

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Pl, MT, Sy, TC) Da = (Pl, MT, Sy, Bl)

Blitz

Pace

The Y2K Case Project

Reinventing Project Management

Part 3 slides

Benefit and Opportunity

High

Approve Immediately

Further Consideration

Low

Further Consideration

Reject Immediately

Risk or Difficulty Low High

Risk and Benefit Assessment Matrix

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Time-Critical

Blitz

D = (Br, MT, Sy, FC)

Pace

Market Watch Project

Technology
Radical Technological Innovation Incremental Technological Innovation
Super-High Tech

High-Tech

Medium-Tech

Incremental Market Innovation

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Architectural Innovation

Fast/ Competitive

Radical Market Innovation

Modular Innovation

Time-Critical

Blitz

Pace

Innovation Categories and Project Types

Product Performance

Manage by Breakthrough Projects

Manage by Platform Projects

Time The Innovators Dilemma and Project Management

Adopted from Clayton M. Christensen, the Innovators Dilemma, 1997 and modified by the authors

Novelty

Breakthrough

Platform

Derivative Platform Mediumtech Operational

Derivative

Technology

Medium to Super-high-tech Strategic

Mediumtech Strategic

Medium to Low-tech Operational

Goal

The Evolution of Project Types along the Product Life-cycle

Adopted from Geoffrey A. Moore, Crossing the chasm, 1991 and modified by the authors

The Microwave Oven Patent Filed

Original Microwave Oven Patent by Doctor Percy L. Spencer, US Patent No. 02495429, Filed Jan. 24, 1950

The first Microwave Oven

Characteristics of projects for various customers

Characteristic Consumer (B2C)
Examples of products Value to customer Producers objective Project focus Product definition MP3 player, PC, cars Impact on quality of life High volume, market share High focus on time, cost, and quality Defined by marketing; perceived customer needs, market research Defined by producer No contract, internal commitment No direct involvement; focus groups or market trials Internally financed Mass marketing, advertisement; brand management; High reliability required Service availability

Customer type Industrial/Business (B2B)

AS/400, B777, ERP systems Impact on business Industry leadership, preferred provider High focus on time and cost Continuous customer involvement

Government/Public (B2G)
Hubble telescope, FCS, Army communication Impact on public goals and needs Long-term relationship High focus on performance Defined by or with customer

Project scope: work, goals, deliverables Contractual obligations Customer involvement

Defined by producer with customer Either external contract or internal commitment Sometimes direct customer involvement Internally financed, or contracted by customer Industry image creation

Defined by or with customer Contracted project, obligations to customer Intense customer involvement; often customer representative on the team Financed by customer according to contract Competition for bids; focused on major decision makers Reliability focused on safety Training, documentation, on-call support

Financing Marketing

Reliability Product support

Reliability may be traded off for timely delivery Training, documentation, on-call support

Technology
Super-High Tech

High-Tech

Medium-Tech

Low-Tech Array System Assembly

Novelty
Derivative Platform Breakthrough

Complexity
Regular

Fast/ Competitive

Required style
Actual style

Time-Critical

Dr = (Br, HT, Sy, Bl) Da = (Br, HT, As, Bl)

Blitz

Pace

Wire and Cable Coating Project

Project Management The Two + One Processes

Product Definition Process

Managerial Process

Technical Process

When are you shooting?

Definition

Planning

Execution

Termination

Revise Plans

Revise Definition

Classical Project Phases Modified to an Adaptive Iterative Approach

Technology

Later design freeze More design cycles

Complexity

Less market data Later requirement freeze

Complex organization Formality

Novelty

Autonomy

Pace

The Impact of the NTCP Dimensions on Project Management

A Framework for Adaptation

Category
Strategic Goal Customer Combined Business Objective

Project Types
Strategic, Operational External, Internal NPD, Product Improvement, Maintenance, Infrastructure, Research

PM Impact

NCTP
Novelty Complexity Technology Pace Derivative, Platform, Breakthrough Assembly, System, Array Low-tech, Medium-tech, Hightech, Super High-tech Regular, Fast/Competitive, TimeCritical, Blitz

Uncertainty of Technical Specs and Design

Ideal World Real World

Project Start
Levels Determined by Novelty, Technology, And Other Uncertainties

Requirements Freeze

Specifications and Design Freeze

Uncertainty of Requirements

Reducing Requirements and Design Uncertainty

Entire Adaptive Iterative Approach

Freeze Requirements

Freeze Design

Requirements

Planning

Specs

Design, Build, Test

Complete

Revise Design
Revise Plans Revise Requirements

Adaptive Approach

Traditional PM

Iterative Process of Requirements and Design Freeze

Change Until Requirements Freeze

Specifications and Design Freeze

Product Requirements

Technical Specifications

Design, Build, Test

Product Prototype

Complete final product

# of Design Cycles

# of Requirements Change Cycles

Initial Market Data

Market Research and/or Market Testing

Time
Adaptive project management Traditional project management

Typical project activities across project phases

Phase
Definition

Activity
Market definition Business objective Product definition Project definition Identifying project type Success and failure criteria Define the expected business objective

Details
Market/customer identification; Customer need

Product description; Product requirements Statement of work (scope); duration; budget; PM and team Categorize a project based on strategic or operational, internal or external user, novelty, technology, complexity, pace Define managements expectation on relevant success dimensions Decide how each project category will affect project organization, processes, plans, activities, and team Break scope into detailed work packages and activities Project team structure Major phases, gates, and milestones Detailed network and timing of activities

Planning

Impact of type on project management WBS Organization Project process plan Schedule

Budget
Risk management Integration plan Procurement Communication Human resources

Detailed cost of project based on WBS items

Risk identification and mitigation plan based on project type Timing and duration of integration activities Subcontracting and vendor management plan Reporting structure and meeting schedule Team development and training; Team motivation

Product creation plan

Initial technical specifications; product design and testing plan

Typical project activities across project phases (cont.)

Phase
Execution

Activity
Product requirements Refine product requirements Freeze product requirements

Details

Product building

Product design Prototype building and testing Additional design cycles (redesign, rebuild, retest) Freeze product design Product building and testing Progress and status of budget, time, and activities performed Update plans and make changes Training materials and means

Project monitoring Project replanning Termination Customer preparedness

Commercialization Project wrap-up

Product introduction plan Project summary report Next generation planning

Risk Assessment

Master plan Entire project

Medium detail plans 4 to 6 Months

Detailed work plans Weeks

Time

The Rolling Wave Planning Concept

Outsourcing Work Packages

Possible Outsourcing Regions