This Document Contains Chapters 8 to 9 CHAPTER 8: Managing Risk Chapter Concepts As mentioned in Chapter 1, one attribute of a project is that it involves a degree of uncertainty. Such uncertainty can impact the outcome of a project. Risk is an uncertain event that, if it occurs, can jeopardize accomplishing the project objective. Risk management involves identifying, assessing, and responding to project risks in order to minimize the likelihood of occurrence and/or potential impact of adverse events on the accomplishment of the project objective. Addressing risks proactively will increase the chances of accomplishing the project objective. Waiting for unfavorable events to occur and then reacting to them can result in panic and costly responses. Managing risk includes taking action to prevent or minimize the likelihood of occurrence or the impact of such unfavorable events. Some level of risk planning should be done during the initiating phase of the project life cycle to make sure, for example, that a contractor understands the risks involved with bidding on a proposed project. With knowledge of potential risks, the contractor can include contingency or management reserve amounts in the bid price. On the other hand, if the risks seem too great, the contractor may decide to not bid on a proposed project, as discussed in the decision to develop a proposal section in Chapter 3. Subsequently, more detailed risk planning should be done during the planning phase of a project. A project manager cannot be risk averse. She must accept that risk is a part of project management and has to address it head-on. Furthermore, the project manager needs to set the tone for encouraging open and timely discussion of risks among the project team. Based upon this chapter, students will become familiar with • Identifying risks and their potential impact • Assessing the likelihood of occurrence and degree of impact of risks • Risk response planning • Controlling risks Learning Outcomes After studying this chapter, the learner should be able to: • Discuss what is involved in managing risks • Identify and categorize risks • Assess and prioritize risks • Prepare a risk response plan • Develop a risk assessment matrix • Control risks Project Management Knowledge Areas from PMBOK® Guide Concepts in this chapter support the following Project Management Knowledge Areas of A Guide to the Project Management Body of Knowledge (PMBOK® Guide): • Project Risk Management Teaching Strategies 1. The two vignettes reinforce the necessity of identifying, assessing, and managing risks in projects. The first vignette communicates that indirect risks must be managed as well as risks related to the work being performed on a project. The second vignette examines how global technology must be managed to help avoid problems when risks such as Hurricane Sandy, the earthquakes and tsunami in Japan, and cyber security attacks take place and potentially could cause problems for the financial system. 2. Risk assessment should be completed for every project. Have students identify risks associated with an activity of their choice, such as a concert that will occur in the area or their weekend plans. Ask them to evaluate the degree of impact and the likelihood of occurrence. Have other students offer techniques for managing the risk. 3. Have students examine a project that has recently appeared in the news and identify the risks that have caused (or might cause) the project to be delayed or to fail. Ask them to suggest how those risks might be mitigated. 4. The risks for the IS example are listed. Have students examine how to mitigate the risks suggested for software development projects. Lecture Notes 1. Real-World Project Management Examples Vignette A: Critical Risks for Underground Rail The underground rail construction of Singapore is filled with risks related to the complex ground structure and a number of risks that are not related to the project activities. The indirect risks must be managed. • Singapore’s Mass Rapid Transit system operates five lines and is adding an additional three fully underground lines by 2020. ○ Unpredictable ground conditions leading to ground settlement control issues is one of the risks the international joint ventures teams is facing. ○ Too great a project for a single civil engineering firm, this large-scale project garnered the collaboration of firms from a number of countries to create a multifaceted team that matches the complexity of the project and adds additional management risks. • Even though the partnerships reduced some of the potential risk associated with the lack of regional knowledge and awareness of customs, communication problems related to social and cultural misunderstandings still plague the project progress. ○ Risks related to differences in management styles, procurement methods, and expectations are catalysts for project failure. ○ Leading risks identified by the joint venture teams included accounting profit and loss disagreements, financial distress, lack of competence, over-interference by parent companies of the contractors, and work allocation disagreements. ○ Some risks that were not associated with the actual work being completed to construct the underground rail. Risks such as policy changes in a contractor’s parent company, exchange rate fluctuations, language barriers, social and cultural customs differences, labor and equipment import restrictions, governmental cash flow issues, and technology transfer disputes all cause delays, conflict, and failure to complete tasks within the project. These risks and those directly related to the work being completed must be managed in order for the underground rail project to be completed by its projected 2020 date. Every risk raises the probability that the underground rail will not be operational when expected. The completion of the construction of the underground rail is dependent upon managing risk. Vignette B: Wrestling with the Grand Challenges of IT Catherine Bessant is a non-It person in charge of IT. Her management skills are beneficial to reduce the risks of IT projects. • One generally doesn’t think of the author Shakespeare when thinking about project management. Catherine Bessant, Bank of America’s Global Technology and Operations Executive, does. Bessant says, “Shakespeare’s lessons, every one of them, are timeless lessons.” Her goal is to build systems that are elastic and foundationally strong yet nimble enough to last for 30 years and through the challenges of hurricanes, tsunamis, earthquakes, cyber-attacks, and other risks. ○ Attention to risk management and mitigation decisions is an even greater challenge when the team is more than 100,000 employees and contractors who handle all the technology and operations for the financial services giant. ○ Technology continues to be advancing rapidly and regulatory requirements are ever changing. ○ Bessant’s team must maintain the robustness in their systems necessary to withstand every potential devastating event that puts Bank of America’s customers at risk of not achieving their business objectives. • The unification has worked to simplify processes for risk mitigation through a series of boot camps to intensely focus on creating risk management strategies. ○ The first boot camp reduced risks and increased understanding of operational risks for the capabilities of the technology operations. ○ Controls were examined process-by-process during the second boot camp to analyze the procedures for any risks. ○ During the third boot camp, the project team identified specific issues, including business continuity and cyber security, and ways to mitigate risks. • Tests such as Hurricane Sandy, the earthquakes and tsunami in Japan, and cyber security attacks have shown the developed risk mitigation strategy has performed extraordinarily. The Global Technology and Operations team of Bank of America wrestled the challenges in their risk management and mitigation plan. They reversed the negative potential effects of the challenges and escaped the serious consequences of the events and incidents, which might have caused the customers to fall. You, too, can be successful controlling risks through management and mitigation plans. 2. Identify Risks • A risk is an uncertain event that, if it occurs, can jeopardize accomplishing the project objective. • Risk identification includes determining which risks may adversely affect the project objective and what the impact of each risk might be if it occurs. • Sometimes a sponsor identifies major risks in the project charter when the project is authorized. • A common approach to identifying the sources of risks is brainstorming. • The risks should be those that are somewhat likely to occur and/or can have a significant negative impact on accomplishing the project objective. • Establishing risk categories may help to identify and evaluate risks. Some categories are technical, schedule, cost, human resources, external, or sponsor/customer. • Historical information from past projects is another source that can be helpful in identifying possible risks. • The project team can progressively elaborate on and identify new risks, as well as the estimated impacts of previously identified risks, as more information is known or becomes clear. 3. Assess Risks • Risk assessment includes determining the likelihood that the risk event will occur and the degree of impact the event will have on the project objective. • Risks can then be prioritized based on their likelihood of occurrence and degree of impact. • Risks on the critical path should be given higher priority, because if they occur, they will have a greater impact on the schedule than will activities on a path that has a large positive value of total slack. • Figure 8.1 depicts a risk assessment matrix, a tool for assessing and managing risks. 4. Plan Risk Responses • A risk response plan is a defined set of actions to prevent or reduce the likelihood of occurrence or the impact of a risk, or to implement if the risk event occurs. • Risk response planning means developing an action plan to reduce the likelihood of occurrence or potential impact of each risk, establishing a trigger point for when to implement the actions to address each risk, and assigning responsibility to specific individuals for implementing each response plan. • A risk response plan can be to avoid the risk, to mitigate the risk, or to accept the risk. • Project prices and budgets should include a contingency or management reserve to pay additional costs associated with implementing response plans. 5. Control Risks • Risk control includes implementing risk response plans and monitoring risks. Risk response plans should be implemented as appropriate when their trigger point is reached. • Risk monitoring includes regularly reviewing the risk assessment matrix throughout the project. • Regularly review and evaluate all risks to determine whether there are any changes to the likelihood or potential impact of any of the risks. • Project meetings are a good forum for regularly reviewing, updating, and addressing risks. • Track and document which risks actually occurred and their impact. 6. Managing Risks for Information Systems Development • Risks for information systems (IS) development are inherent in all aspects of an IS project. • The risks can be categorized into seven types: technological risk, human risk, usability risk, project team risk, project risk, organizational risk, and strategic and political risk. • These categories help explain the risks associated with developing systems that accept data inputs, process those inputs, and produce information for users. • Chapters 4, 5, 6, and 7 provided foundation information about the definition, scheduling, resources, and costs associated with IS development projects. A. An IS Example: Internet Applications Development for ABC Office Designs (Continued) • Beth wants to prepare for potential risks in the project so the team can take care of them early and not jeopardize the delivery date for the system. • Beth planned for the team to determine the impact of the risk, the likelihood of occurrence, the degree of impact if it does occur, the action trigger that will serve as a warning flag for the risk, who is responsible for the risk, and the response plan to avoid, mitigate, or accept the risk. • Beth reviewed the lessons learned from other projects again, to make sure the project team discussed the risks from the other projects. • Figure 8.2 depicts the Risk Assessment Matrix for Web-based Reporting System Project. 7. Critical Success Factors • Identify risks and their potential impacts before the project starts. • Include the project team or experts in assessing risks. • Assign high priority to managing risks that have a high likelihood of occurrence and a high potential impact on the project outcome. • Develop response plans for addressing high priority risks. 8. Summary • Risk is an uncertain event that, if it occurs, can jeopardize accomplishing the project objective. • Risk management includes identification, assessment, control, and response to project risks in order to minimize the likelihood of occurrence and/or the potential impact of adverse events on the accomplishment of the project objective. • Risk identification includes determining which risks may adversely affect the project objective and estimating what the potential impacts of each risk might be if they occur. • Assessing each risk means determining the likelihood that the risk event will occur and the degree of impact it will have on the project objective, and then prioritizing the risks. • A risk response plan is a defined set of actions to prevent or reduce the likelihood of occurrence or the impact of a risk, or to implement if the risk event occurs. • Regularly review and evaluate all risks to determine whether there are any changes to the likelihood or potential impact of any of the risks, or whether any new risks have been identified. Questions 1. Describe what needs to be done to manage risk on a project. When should this be done? How can a risk assessment matrix help in this process? To manage risk on a project, the team needs to identify and assess risks to determine their impact and likelihood. Identification and assessment of risk occurs throughout the project. Project team meetings are good times to review risks and the risk management plan. The risk assessment matrix helps the process by organizing the identified risks and assessing the risks' impact, likelihood, degree of impact, the action trigger for the risk, who is responsible, and the response plan. 2. From your experience working on projects, list and categorize three risks. Was the response plan for those projects adequate to mitigate these risks? How would you respond to these risks now? Risk categories could include technical, schedule, cost, human resources, external, or sponsor/customer and other categories. Answers should include an evaluation of the response plan for the risks and how the risk could have been mitigated if they were not adequately addressed. Students should also define a trigger point and a risk response plan for the risks. 3. What risks for a project have the highest priority? Does the priority for a risk change as the project progresses? Risks that have the highest priority are those on the critical path and those that have high degree of impact and high likelihood of occurrence. Yes, the priority of a risk can increase or decrease in priority as the project progresses due to the evolving project environment. 4. How does project risk change as a project progresses? What changes are made to the risk assessment matrix as the changes occur? As the project progresses, some initial risks may no longer be a factor and other risks may be identified that need to be addressed. The risk assessment matrix is adjusted to update the likelihood of occurrence, the degree or impact, the action trigger, the responsibility, and the response plan. Internet Exercises Assign the Internet Exercises to your students as homework or complete them together in a computer lab. The search for "project risk management" results in a number of sites that define project risk management and offers tools and suggestions for how to perform project risk management. Have students compare the tools in the websites with the risk assessment matrix presented in the chapter. The website for the Software Program Managers Network identifies proven industry and government software best practices and contains a number of resources to convey the best practices to managers of large-scale software-intensive acquisition programs. The 16 critical success factors are categorized into project integrity, construction integrity, and product stability and integrity. The “lesson learned” section of the site has lists of lessons learned by experienced project managers to help managers of new projects avoid the mistakes and pitfalls experienced by their predecessors. The web links page is an alphabetical listing of resources to help in project management of the large-scale software-intensive projects. Case Study #1 A Not-For-Profit Medical Research Center This case has continued through Chapters 4 to 8. Each chapter has questions to reinforce the concepts presented. This is an open-ended case study. The students have the opportunity to be very creative on this one. Encourage that creativity. Answers to Case Questions Answers will vary from student to student for each question. 1. Identify at least four risks that could jeopardize the project. The four risks could include risks that are related to the technical, schedule, cost, human resources, external, or sponsor/customer aspects, or other identified categories, of the project. 2. Create a risk assessment matrix including a response plan for each of the risks. The risk assessment matrix includes the likelihood of occurrence, the degree or impact, the action trigger, the responsibility, and the response plan for each of the four risks. Group Activity Divide the course participants into the same groups as for the previous chapter’s group activity and answer the questions listed above. Case Study #2 The Wedding This case has continued through Chapters 4 to 8. Each chapter has questions to reinforce the concepts presented. This is an open-ended case study. The students have the opportunity to be very creative on this one. Encourage that creativity. Answers to Case Questions Answers will vary from student to student for each question. 1. Identify at least four risks that could jeopardize the wedding. The four risks could include risks that are related to the technical, schedule, cost, human resources, external, or sponsor/customer aspects, or other identified categories, of the wedding. 2. Create a risk assessment matrix including a response plan for each of the risks. The risk assessment matrix includes the likelihood of occurrence, the degree or impact, the action trigger, the responsibility, and the response plan for each of the four risks. Group Activity Divide the course participants into the same groups as for the previous chapter’s group activity and answer the questions listed above. Case Study #3 Student Fund-Raising Project This case study describes a project by students to help raise funds for upgrading the pediatric intensive care unit at the local hospital. A team of 15 representatives from the fraternities and sororities raised concerns and formed a planning committee to develop a plan. Answers to Case Questions Answers will vary from student to student for each question. 1. What would you recommend for the next possible steps? A baseline plan needs to be established—identifying the objective, defining specific activities, establishing time estimates and a budget, and determining how the project can be accomplished. The students must identify all risks associated with the project, assess these, and create a response plan including a contingency plan. Finally the subdivided tasks must be executed and the progress should be tracked and controlled. 2. Identify three potential projects to raise funds for the hospital pediatric intensive care unit. Answers will vary from student to student. Projects should include a description of the activity, the amount of funds to be raised, and the amount of resources necessary to raise the funds. 3. Select one of the three projects and identify four risks that could jeopardize the success of the project. Answers will vary from student to student. The four risks could be related to the technical, schedule, cost, human resources, external, or sponsor/customer aspects, or other identified categories, of the project. 4. Develop a response plan for how each of the four risks can be either avoided or mitigated. Response plan can be to avoid, to mitigate, or to accept the risk. Responses should include a description of how the risk will be avoided, mitigated, or accepted and who is the person responsible for the risk. Group Activity Divide the course participants into teams of three or four. Have them: • Brainstorm a list of eight possible projects to raise funds for the hospital. • Agree on one of the eight projects. • For the selected project, identify six risks that could jeopardize the success of the project. • Develop a response plan for how each of the six risks can be either avoided or mitigated. Have each team select a spokesperson to present their responses to the entire class. Optional Supplemental Activities 1. Ask students to read the real-world vignettes. 2. Have them read the chapter and answer all the Reinforce Your Learning questions and the questions at the end of the chapter. 3. Ask students to contact an author of the materials on the SPMN website and present what they learned from the author. 4. Let students research the lessons learned or any of the articles on the SPMN website and then present their findings to the class. CHAPTER 9: Closing the Project After the project work is completed and all the deliverables are accepted by the customer, the performing phase of the project is ended. The project then moves into the fourth and final phase of the project life cycle—closing the project. This chapter discusses the various activities involved in the process of closing the project. Based upon this chapter, students will become familiar with • Actions that should be taken when closing a project • Conducting a post-project evaluation • The importance of documenting lessons learned • The need to organize and archive project documents • Obtaining feedback from the customer about the project • Early termination of projects Learning Outcomes After studying this chapter, the learner should be able to: • Identify actions that should be taken during the process of closing a project • Conduct a post-project evaluation • Discuss the value and use of lessons learned • Explain the importance of organizing and archiving project documents • Obtain customer feedback about the project • Describe situations that could result in early project termination Project Management Knowledge Areas from PMBOK® Guide Concepts in this chapter support the following Project Management Knowledge Areas of A Guide to the Project Management Body of Knowledge (PMBOK® Guide): • Project Integration Management Teaching Strategies 1. The two vignettes address acknowledging lessons learned during the project and recording those lessons at the close of the project. Lessons learned should be recorded as the project progresses so they are not forgotten by the time the project is finished. Lessons learned from other projects can be a valuable resource for saving time and money on the current project. 2. Lessons learned from projects are invaluable. The team can save expenses on the next project by implementing time-saving processes and not repeating mistakes. Have students identify lessons learned that can help them in this course or in other courses they may be taking. 3. Have each student describe a project on which he or she has been a team member. For each project, have the student describe the best lesson learned from the project and one thing that should have been done differently. Record these lessons to create a best-practices list for projects and a list of ways to improve projects. Lecture Notes 1. Real-World Project Management Examples Vignette A: Lessons Learned in the Bird’s Nest The Bird's Nest project was set for short timelines of production and then suffered a number of project changes. The resulting structure will not meet the initial plans and most likely will be converted into a shopping complex. • By hosting of the Olympic Games, a host country has an opportunity to raise the awareness of their country’s attributes and to positively strengthen the attitudes held about their country around the world. ○ The design of the Bird’s Nest was meant to showcase China’s construction abilities, infrastructure development, and economic success. ○ The initial design included a retractable roof to permit indoor events after the Olympic Games were completed, 2,000 parking spaces, and commercial areas within the stadium. ○ Changes in the project eliminated the retractable roof, slashed the number of parking spaces in half to 1,000 spaces, and reduced the number of commercial areas within the arena. • Evaluation of the project and its prospects for use after the Olympic Games have led to a number of lessons learned, which are valuable for future cities seeking to host future games. ○ The first lesson was that government support and commitment to the project are essential to innovative and complex designs. ○ Strategic planning and community interests must be part of the planning for short term national esteem projects associated with hosting of Olympic Games or other international contests was the second lesson learned. ○ Project aims and objectives for the entire life cycle of the project should focus on high efficiency, international safety standards, cost containment, and project completion. ○ The fourth lesson learned pertained to alignment of public and private sector interests, especially as the interest alignment impacted risk management. Development of an attraction that has no future benefit to the community or one that puts community members at risk during construction are a source of poor rapport between business developers and community members. The National Stadium demonstrated to the world the innovative design and construction capabilities of China and provided very important lessons learned. Redesign delays of six months caused an already tight schedule to be even more severe. Hopefully, the lessons learned in Beijing will provide guidance to other cities developing showcase facility projects for large international events. Vignette B: Lessons Learned Help CSP Department Operate Sanford Medical Center expanded its CSP department. The redesign project included using lessons learned from other projects and their own knowledge from the small department they managed. • Operating rooms rely on sterile processing and distribution departments to sterilize and maintain a broad range of complex instruments. ○ Used instruments are brought into one area of the sterilization department and cleaned in another. ○ The Sanford Medical Center in Sioux Falls, South Dakota, was facing the challenge of sterilizing and packaging instruments in a timely manner for their surgical procedures. • The facility was so small that only sterilization could occur in the central sterile processing (CSP) department. • The operating room staff had to process and package their own instruments after sterilization. ○ With the construction of a new medical tower, the medical center needed to expand and redesign its CSP department. • The members of the CSP department worked with the vendors to create a project plan for the design of the new department that did not include the operating room staff processing and packaging instruments. ○ The project plan incorporated best practices, optimized workflows, and the appropriate mix of equipment to meet the current and future needs. • The medical center staff worked closely with the vendor and the architect to complete a survey of the needs of the medical center CSP. • The project team answered questions related to the number of surgical suites in operation and planned for the future, the number of procedures performed during peak periods, what clinical services were associated with the procedures, and what instruments were in inventory and what were needed to meet the future needs. • The plans included lessons learned from other CSP redesign projects. • To further help with the speed and efficiency of the CSP, Sanford Medical Center implemented an instrument tracking system. The Sanford Medical Center CSP team used their knowledge of the processes and design of their small unit and the experiences of other sterile processing departments to create a project to meet their current and future needs. At the close of their expansion project, Sanford Medical Center staff shared their lessons learned with other CSP planning teams to help in their design projects. 2. Project Closing Actions • The process of closing the project includes: ○ Collecting and making final payments ○ Recognizing and evaluating staff ○ Conducting a post-project evaluation ○ Documenting lessons learned ○ Organizing and archiving project documents • Activities associated with closing the project should be identified and included in the project baseline plan. • Figure 9.1 depicts the project life cycle. A. Final Payments • Ensure that all payments have been collected from the customer. • Verify that all payments have been made to any subcontractors, consultants, vendors, or suppliers for any purchased materials or services. • Once all payments have been received and made, close the project “books,” or accounting records, and make a financial analysis of the project that compares final actual costs to the project baseline budget. B. Staff Recognition and Evaluation • Successful projects should end with some type of recognition and celebration. • The project manager should prepare a written performance evaluation of each member of the project team that mentions how each has expanded his or her knowledge as a result of the project assignment and identifies areas he or she needs to develop further. C. Post Project Evaluation • During the closing phase, review and evaluate performance of the project and identify what can be done to improve performance on future projects. • Hold individual meetings with team members to hear feedback from each about his or her performance and how to improve future projects. • At the group meeting with the project team, the project manager should lead a discussion of what happened during performance of the project and solicit specific recommendations for improvement. • Topics to be discussed: ○ Technical performance ○ Budget performance ○ Schedule performance ○ Project planning and control ○ Risk management ○ Customer relationships ○ Stakeholder engagement ○ Team relationships ○ Communications ○ Problem identification and resolution ○ Lessons learned ○ Recommendations • The project manager should prepare a written report of project performance, including lessons learned and recommendations. • Figure 9.2 depicts a post-project evaluation team meeting agenda. D. Lessons Learned • The purpose of identifying and documenting lessons learned is to capitalize on the knowledge and experience gained on the project in order to improve performance on future projects. • The project organization should establish a knowledge base system including an easily accessible repository that encourages project managers and teams to retrieve lessons learned and information from previous projects. • The system should organize information so that it is easily retrievable by category or subject of lesson learned or by key words. • The project team should not wait until the end of the project to capture and document lessons learned; they should do this on an ongoing basis throughout the planning and performing phases of the project. • Project managers should make lessons learned an agenda topic on each new project and include it in project management training. E. Archive Project Documents • During project closing, the project team or contractor should ensure that copies of appropriate project documentation are properly organized, filed, and archived so they can be readily retrieved for future use. • As part of, or in addition to, the documents in the archive, a database of common data elements from past projects can help identify trends or correlations that could be helpful in bidding, planning, and/or performing future projects. 3. Customer Feedback • Just as important as having the internal post-project meetings within the project organization is having a post-project evaluation meeting with the customer or sponsor. • The purposes of this meeting should be to determine whether the project provided the customer with the expected benefits, assess the level of customer satisfaction, and obtain any feedback that would be helpful in future business relationships with this or other customers. • Meeting participants should include the project manager, key project team members, and key representatives of the customer’s organization who were active in the project. • The project manager should schedule the meeting when the customer is in a position to really determine whether the project met expectations and achieved the anticipated benefits. • The open-ended question meeting should contain an opportunity to talk about possible additional projects and obtain permission to use the customer as a reference with potential customers. • Figure 9.3 depicts a post-project customer evaluation survey. 4. Early Project Termination • Circumstances such as the following may require the sponsor or the customer to terminate a project before it has been completed: ○ change in financial situation ○ change in project return on investment ○ dissatisfaction with project progress ○ change in project needs • Monitor the level of customer satisfaction continually throughout the project and take corrective action at the first hint of any dissatisfaction. 5. Critical Success Factors • Recognize the project team and celebrate accomplishments throughout the project. • Regularly ask the customer about the level of satisfaction with the performance and progress of the project, and take corrective action at the first hint that the customer is not satisfied. • After the conclusion of a project, evaluate the project performance to learn what could be improved if a similar project were to be done in the future. Feedback should be obtained from the customer and from the project team. • Capture and document lessons learned throughout the performance of the project. • Establish a knowledge base of lessons learned and ensure that they are communicated and used on future projects. • Organize and archive project documentation and analyze key data that could be helpful in bidding, planning, or performing future projects. • Retain customer evaluation and feedback information that could be valuable in developing proposals for other projects for this or other customers in the future. 6. Summary • The fourth and final phase of the project life cycle is closing the project. • An important project closing action is staff recognition and evaluation. • Conduct post-project evaluation meetings with individual team members and hold a group meeting with the project team to gather feedback for improved future performance. • Identify and document lessons learned to capitalize on the knowledge and experience gained on the project in order to improve performance on future projects. • Ensure that copies of appropriate project documentation are properly organized, filed, and archived so they can be readily retrieved for future use. • Hold a post-project evaluation meeting with the customer or sponsor, or distribute a customer evaluation survey, to determine whether the project provided the customer with the expected benefits, to assess the level of customer satisfaction, and to obtain any feedback that would be helpful in future business relationships with this or other customers. • Sponsors or customers may terminate projects before completion for various reasons. Questions 1. Discuss what needs to be done as part of closing a project. Why are these activities important? The process of closing the project includes collecting and making final payments, recognizing and evaluating staff, conducting a post-project evaluation, documenting lessons learned, and organizing and archiving project documents. These activities are important to make sure that the customer is satisfied, to gather information about how to improve for future projects, to determine whether additional opportunities are available with the customer, and to obtain permission to use the customer as a reference. 2. Discuss the internal post project evaluation process and the two types of meetings involved. The internal post-project evaluation process includes meetings with individual team members and a group meeting with the project team to gather feedback for improved future performance. The individual meetings allow the project manager to gather information and share performance appraisals describing how each team member's skills advanced while working on the project. The post-project team meeting is a time for the project manager to lead a discussion about how the team performed on the project in terms of technical competence, budget, schedule, project planning and control, risk management, customer and team relationships, communication, problem identification and resolution, lessons learned, and recommendations. 3. What are some ways you can obtain feedback from a customer after a project has been completed? How would you use this information? The post-project evaluation can be conducted as a meeting with open-ended questions or through a customer evaluation survey. The information is used to assess the level of satisfaction of the customer, opportunities for future work, and permission to use the customer as a reference. 4. Why are some projects terminated before they are completed? When would it be wise to do so? The sponsor or customer can terminate a project for a variety of reasons including changes in financial situation or project return on investment, dissatisfaction with project progress, and changed project needs. It is wise to terminate a project if the cost of completing it is greater than the benefits, the project is no longer needed, or it is not being completed in a satisfactory manner. 5. List the several lessons learned from a project in which you were a project team member or project manager. How will these lessons learned inform your future projects? Responses will be dependent upon the project. Common lessons learned include: increase project team communication, have more frequent project team meetings, analyze project progress to be more proactive with tasks that are delayed, have more meetings with the customer, document changes more thoroughly, and discuss risks at each project team meeting. Not all lessons learned are due to negative experiences. Positive experiences with implementing a technology solution are valuable lessons learned. These lessons inform future projects by giving team members valuable experience and helping them avoid repeating past mistakes. Internet Exercises Assign the Internet Exercises to your students as homework or complete them together in a computer lab. Many projects are documented on the Internet. Search terms could include completed project and specific categories of interest. For example, if a student is interested in drug trials that have been completed, the search terms could be pharmaceutical drug trial project outcomes. Have students share their search terms and record them for other classes as lessons learned. The searches for "project lessons learned," "post-project evaluations," and "project management standards" result in definitions, tools, and descriptions of each. Have students share any additional terms they may have included to further refine their searches. Project management journals contain a variety of articles. Some journals have a theme and others accept articles that are of interest to the project management community. Have students examine trends in the themes of the articles to see whether a particular topic is more frequently presented or there is a pattern to the topics. Case Study #1 Factory Expansion Project This case describes a growing electronics company that has expanding sales and needs additional capacity. Answers to Case Questions 1. What should Andy Gibson have done differently in his meeting with Jacob Clemson in Jacob’s office? Andy barged into Jacob’s office without an appointment and without respecting that Jacob might be in the middle of other business. Andy should have scheduled an appointment and listened to Jacob. 2. What are some things Andy could have done differently from his initial contact with Mr. Clemson and during the project? Clearly Andy needs to work on his communication skills. He also needs to learn to listen to Jacob’s concerns. 3. What are some things Jacob could have done differently from the time he met Andy Gibson initially and during the project? Jacob needs to stop and think and state his views clearly. Jacob needed to explore the reputation of Andy's company and determine whether other companies did similar work in the area. Jacob could have documented the problems with the project and communicated them in writing. Jacob also can withhold the final payments and the bonus until the project has been completed to his specifications. 4. What should Gerri do? Gerri clearly thinks Andy is being unethical and she should re-think their business relationship. Some responses may consider that Gerri should leave this company because of its management style and find a position better suited to her ethical standards. Other responses could propose solutions for improving project communication and avoiding the unethical proposal to get the bonus money. Group Activity Divide the course participants into groups of three or four to develop responses to the case questions. Each group must choose a spokesperson to present its responses to the entire class. Case Study #2 Market Research Report Project This case describes a project manager and her communication plan with the customer and project manager. Answers to Case Questions Answers will vary from student to student for each question. 1. Did Meghan’s team satisfy the customer? Why or why not? The project customer was Christine, and it seemed that Christine and Sarah were communicating. Meghan's assumption that Sarah was communicating to Christine may have been a problem and could explain why Christine was not satisfied at the point of distribution. If the project team made the changes she suggested, Christine would be satisfied. 2. How should Meghan respond to the comments from Christine after Sarah had given feedback and approval for the final report? Christine is the customer who contracted with Meghan's team for the project, so Meghan should have included Christine on the earlier communications. There should be no surprises for either the customer or the contractor at the close of the project. Meghan should respond with a plan to implement the corrections because the customer is not satisfied and has not accepted the product. 3. The project team had gone through the steps of closing this project. They have one week of slack in the schedule before they would be causing another project to be delayed. What should Meghan do with her team? Meghan should plan the work necessary to make the corrections to the product and meet with the project team to determine whether they can be done within the week's slack. 4. What should Meghan have done differently in the project? Even though Christine said that she did not have time to devote to the project, she should have been copied on all the communications with Sarah, her project manager. Both Christine and Meghan were surprised at the end of the project, and neither the contractor nor the customer should be surprised at the close of the project. Any changes to the project should be approved by the customer in writing. Group Activity Divide the course participants into groups of three or four to develop responses to the case questions. Each group must choose a spokesperson to present its responses to the entire class. Optional Supplemental Activities 1. Have the students read the real-world vignettes and research the Internet for other articles about the two projects. 2. Ask students to read the chapter and answer all the Reinforce Your Learning questions and the questions at the end of the chapter. 3. Have students present a summary of an article from the project management journal found in the Internet exercise. If possible, let them contact the author of the article to discuss its contents and then report their findings. Instructor Manual for Successful Project Management Jack Gido, Jim Clements 9781285068374
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