Online Chapter C – Project Management Techniques Table of Contents Chapter Overview Learning Objectives Notes on Opening Case and EOC Cases Instructor's Notes (for each section) Key Terms Lecture notes Quick quizzes Classroom Activities Troubleshooting Tips Discussion Questions Chapter Overview This online chapter provides supplemental materials for Chapter 11, Project Planning and Project Management, of the printed text. The first three sections teach specific skills in (1) calculating net present value, (2) understanding and being able to manually construct PERT charts, and (2) using Microsoft Project to create project schedules. A trial version of Microsoft Project is provided with each textbook so the students can learn how to build schedules. The printed Chapter 11 provides a brief introduction; this online chapter provides more in-depth discussion of how to use Microsoft Project. The final section of this online chapter reviews in more depth each of the ten PMBOK knowledge areas. The Project Management Institute (PMI) is a large and active professional organization with lots of materials and training course available. The PMBOK is one major contribution that the PMI has made to project management, and it would be instructive for new systems developers to become well versed in these concepts. Learning Objectives After reading this chapter, the student should be able to: Calculate net present value, payback period, and return on investment Develop a PERT/CPM chart Be able to set up a project in Microsoft Project Explain how Microsoft Project can be used to track an existing project Explain the ten areas of the Project Management Body of Knowledge Notes on Opening Case and EOC Cases Opening Case Succeeding as a First Time Project Manager: This case relates the experience of a new project manager being coached or tutored by a more experienced project manager. The experienced project manager indicates that she takes each of the ten PMBOK areas and builds her own checklist of tasks and steps to ensure that she has covered all the needs of each project management body of knowledge area. This case serves as a good introduction to the case at the end of the chapter. EOC Cases Custom Apps Now: The case at the beginning of the chapter, “Succeeding as a First Time Project Manager,” lays the ground work for this case. In this case, the student is asked to create his/her own checklist of tasks and responsibilities for each PMBOK area. This is a great exercise to help students prepare for careers and work as systems developers. A good classroom activity is to have various students present their lists. It makes an effective learning activity. Instructor's Notes Calculating Net Present Value, Payback Period, and Return on Investment Key Terms discount rate – the annual percentage rate that an amount of money is discounted to bring it to a present value discount factor – the accumulation of yearly discounts based on the discount rate Lecture Notes Net Present Value Calculations The two basic concepts of net present value are (1) that all benefits and costs are calculated in terms of today’s dollars (that is, present value) and (2) that benefits and costs are combined to give a net value—hence, the name net present value. The first step in calculating the NPV is to decide on the discount rate to use. The equation that represents this is: present value = amount received in future/ (1 + discount interest rate) number of years For dollar amounts received more than one year in the future—for example, in three years—the discount rate is applied three times to give a discount factor. The equations that apply to find a present value for a future value across multiple years are: Fn = 1/ (1+ i)n and PV = FV * Fn Figure C-1 shows the NPV calculations for Ridgeline Mountain Outfitters. In this instance, the NPV calculation was done for a period of five years. Year zero is considered the time period during which the asset is being developed and while no benefit is being derived by the organization. Payback Period Calculations Payback is a method to determine the point in time at which the initial investment is paid off. Various methods are used to calculate payback. Payback period can be calculated by using either present value amounts or cash flow amounts. Cash flow amounts don’t take the time value of money into consideration and calculate payback based on non-discounted dollar amounts. Another approach is to consider only the initial investment and not include annual operating costs in the calculations. A precise answer for determining the fraction of a year when payback actually occurs is to calculate the ratio of the negative value at the beginning of the year to the total amount of benefit derived during the year and then to apply this ratio to the number of days in a year to determine the number of days until break-even. Return on Investment While the objective of the NPV, as explained earlier, is to determine a specific value based on a predetermined discount rate, the objective of the return on investment is to calculate a percentage return (like an interest rate) on the initial investment. The time period for ROI calculations also critically affects the result. Figure C-2 illustrates an example of calculating a five-year ROI. Quick Quiz Q: What is the difference between a discount rate and a discount factor? A: The discount rate is the percent value that money is discounted each year. When the discount rate is applied over and over again across multiple years, it becomes a discount factor. So the discount factor value is associated both with a discount rate and a number of years. Q: What does payback period mean? How does it relate to the break-even point? A: The payback period is that length of time to repay the investment in the new system (or something). The break-even point is the same concept. It is that point when the benefits offset the costs or the investment. Q: Why is the number of years so critical in calculating Return on Investment? A: An ROI determines the percent return on an investment. Since an investment is expected to continue to provide benefits continually as time passes, the expected ROI increases each year – as more benefits are accrued. Hence to compare ROI values, between options, they must be given for the same length of time. Understanding PERT/CPM Charts Key Terms early start time – the earliest time that a task can begin due to predecessor durations late start time – the latest time that a task can start to maintain the schedule slack time – the amount of time a task or leg of sequential tasks can be delayed without impacting the project schedule Lecture Notes PERT, which stands for Project Evaluation and Review Technique, was first developed in the 1950s and was used by the U.S. Department of Defense to organize, monitor, and control very large, complex defense projects. CPM, which stands for Critical Path Method, was developed independently, also in the 1950s. More recently they have been combined into a single technique called PERT/CPM. The strength of a PERT/CPM chart is that, as a network, it provides a visual representation of the relationships between tasks of a project. During the development of the project schedule and especially while trying to determine task dependencies, a PERT/CPM chart can be an effective tool. The first step in creating a schedule is always to develop a work breakdown structure. The next step is to assign task dependencies, which lay the foundation for the development of the PERT/CPM chart. There are three types of dependencies between tasks: (1) project mandatory, (2) external mandatory, and (3) discretionary. Predecessors are usually easily assigned to project mandatory dependencies. Often, several tentative schedules must be built with different dependencies to determine a sequence that best utilizes team members. This activity is often best completed with a white board and sticky notes. Figure C-4 is a sample PERT/CPM chart that could have been drawn with sticky notes on a white board or with any computer drawing tool, such as Microsoft Visio. We call this the first-cut PERT/CPM chart because although the dependencies are correct, we will have resource conflicts. The final version of the PERT/CPM chart will have to be adjusted to take this into consideration. The early start time represents the earliest time that a task can begin. In other words, based on all the predecessor tasks, the given task can’t begin until the time indicated. This field is calculated by taking the early start time of the predecessor task and adding to it the duration of the predecessor task. Here is the formula: ESn+1 = ESn + durationn + lag time One complexity occurs when there are multiple predecessor tasks with different values for the task to be calculated. Hence, the equation becomes: Esn+1 + {Esn + durationn}latest + lag time The late start time is the latest time that a given task can start and still keep the project on schedule. Late start times are calculated by starting at the end of the project and moving backward through the diagram. To calculate other late start times, we simply move backward through the diagram by using the following equation: LSn-1 + durationn-1 = LSn or (equivalently) LSn-1 = LSn - durationn-1 In Chapter 11, we defined the critical path as the sequence of tasks that can’t be delayed without causing the project to be delayed. Notice on Figure C-4 that some tasks have the same early start time and late start time. That means they must start on the indicated time or else the project is delayed—in other words, that there is no slack time in those tasks. The time difference between the early start time and the late start time is called the slack time. It represents the amount of time a task can be delayed with delaying the project. Quick Quiz Q: What is early start time? A: It is the earliest time that a task can begin. It is determined by the predecessor tasks and when they end. Q: What is the difference between the early start time and the late start time? A: The early start time is the earliest time a task can begin, while the late start time is the latest that it can begin without delaying the project. Q: What does it mean when the early start time and the late start time are equal? A: The task is on the critical path, and it must start at the specified time or else the project will be delayed. Q: How is slack time calculated? A: It is the difference between the early start time and the late start time. Building the Project Schedule with Microsoft Project Key Terms none Lecture Notes A Gantt chart is a type of bar chart that is superimposed on a calendar. The primary strength of a Gantt chart is that the bars show the duration and project progress as compared to the days and weeks of the calendar. Gantt Chart View Microsoft Project is a rich application with many features and capabilities. The advantage of a project tool is twofold. First, it is much easier to make changes to the schedule when it is necessary to add, delete, or update tasks. Second, it is easier to track progress by using a project tracking Gantt chart. The process to build a Gantt chart using Microsoft Project is as follows: Step one: Set up a New Project: For a simple project, there are only two pieces of information that need to be set: the project name and the project start date. Step Two: Enter Information About the Resources: Even though this may not appear to be the next logical step, it makes entering the tasks much easier. To enter the resources, go to the View | Resource Sheet menu item. Step Three: Enter Information About the Tasks: This step is where we actually enter all the information from the work breakdown structure. There are several ways that this can be done. Students are encouraged to experiment and find their preferred method. One effective method is to use a split screen. To get to the split screen, go to the View tab and then click the Details icon on the toolbar. There are two other important fields on the bottom form in a split screen that are often misunderstood. They are the Effort Driven field and the Task Type field. The number of resources, the amount of work, and the duration of the task are often related by this formula: duration = amount of work multiplied by the number of resources. After entering the basic information for the task, one can enter the predecessor number in the appropriate column. Figure C-9 is the completed schedule with all the tasks entered, resources assigned, and predecessors defined. One of the benefits of using a tool such as Microsoft Project is that it indicates when there are conflicts in the project schedule. There are several methods that can be used to resolve these conflicts. One method, of course, is to manually adjust the schedule to reschedule those tasks that are causing a conflict. Microsoft Project also has a tool to help reschedule the project to remove the conflicts. Under the Resource tab, as seen in Figure C-10, there is an icon called Leveling. Figure C-11 also illustrates the two other types of tasks: summary tasks and milestone tasks. Summary tasks are simply a convenient way to group detail tasks. Milestone tasks always have a duration of zero and are used to indicate some important delivery or completion. Tracking Gantt Chart One major advantage of using a tool such as Microsoft Project is the ability to track the project as work is completed. Because a Gantt chart is projected onto a calendar, it is straightforward to see if the completion of the tasks corresponds to the projected completion dates. Figure C-12 is an example of a tracking Gantt chart in Microsoft Project. PERT/CPM and Network Diagrams Once the data has been entered into Microsoft Project, then a Network Diagram screen can be displayed to show the project in a PERT/CPM format. Figure C-13 is an example of Microsoft Project’s Network diagram. Quick Quiz Q: Why is it helpful to identify and describe resources first? A: So they can be assigned at the same time that the task data is entered. Q: What is the difference between a Gantt chart and a PERT/CPM chart? A: A Gantt chart is a bar chart on a calendar, while a PERT/CPM chart is a network of connected tasks. Q: What is the benefit of each? A: A Gantt chart is better for viewing progress and overall list of tasks. A PERT/CPM chart is better for visually understanding dependencies (predecessors) between tasks. Q: What is a split screen in Microsoft Project? A: For entering tasks, the screen will show both the list of tasks, and then a detailed form containing the detail task information. It is a useful way to enter task information. Project Management Body of Knowledge (PMBOK) Key Terms none Lecture Notes There are two primary approaches to teaching project management. One method is to focus on and teach the specific tasks that are required to manage a project. Another approach to learning about project management is to concentrate on its principles and practices apart from the processes of a project. In the printed textbook, we focused on the first approach. In this section of the online Chapter, we focus on the second approach. This section is based on the Project Management Body of Knowledge (PMBOK) that has been developed by the Project Management Institute (PMI). The PMBOK is divided into nine major categories, which we briefly discuss in this section. Project Scope Management Objectives: The objectives of project scope management are: To precisely define the functions and capabilities to be included in the new system To verify that the identified capabilities are necessary and are important priorities for the project at hand To control the set of functions so it doesn’t grow inappropriately Techniques: There are three main categories of scope management techniques: (1) defining the scope, (2) verifying the scope, and (3) controlling the scope. Generally there are two areas of scope that are defined and controlled: the scope of the new system and the scope of the project itself. Project Time Management Objectives: The objectives of project time management are multifaceted: To ensure that the project schedule accurately accommodates the work to be done To effectively use resources and techniques to accelerate the overall time to completion To accurately measure completed work to correctly assess the percentage completed Techniques: Time management techniques include building the project schedule, making changes to it, monitoring progress based on the scheduled dates, and shortening the project schedule by using optimization techniques. Project Cost Management Objectives: The specific objectives associated with project cost management are: To accurately estimate the anticipated project costs To accurately predict the cash flow and timing of expenditures To confine actual project expenditures to those that are included within the plan To capture and record actual project expenditures correctly Techniques: Project cost management techniques are based on fundamental accounting principles, which you learn in your cost accounting and managerial accounting classes. Project Quality Management Objectives: The single objective of project quality management is to produce a system that is: Easy to use; Fit for its intended purpose; Robust; Reliable; Secure; Maintainable. Techniques: All too frequently, project managers focus exclusively on program testing to ensure a high-quality system. But quality control should be planned from the beginning, and procedures should be integrated throughout all activities of the project. Every milestone and intermediate delivery should contain specific reviews and measurements to test for quality. Project Human Resources Management Objectives: There are six primary objectives for project human resources management: To ensure that the project team is staffed at the right time with people who have adequate skills in the right mix To provide appropriate training and development opportunities for members of the team To organize the project team and subteams for effective work To encourage work teams to become effective working units To provide the leadership and vision necessary to encourage and motivate members of the team To ensure that the working environment, including facilities, tools, and support, is conducive to accomplishing work Techniques: Project managers should always remember that their primary responsibility is to enable and allow the team members to do their best work. Project Communication Management Objectives: Project communication management can also be organized to accomplish the following objectives: To ensure that the necessary information is gathered in a timely manner and is complete and accurate To ensure that project information is disseminated frequently and is an accurate representation of the project To ensure that members of the project team have current information To capture and record important project information in a central information repository Techniques: There are three areas that are included in Communication Management: The gathering of information The methods of internal communication to ensure that the team is well informed The methods for external reporting of project progress and issues Project Risk Management Objectives: The three primary objectives of risk management are: To determine the potential areas of high risk for the project To develop strategies and plans of actions to reduce the identified risks To carry out the plans of action to monitor and control the project risks Techniques: A common technique for identifying project risks is to have an open session on risk identification and tracking that includes senior project members, outsiders, and even team members. Team members can often observe risks that senior management may not see. Project Procurement Management Objectives: Specific objectives of project procurement management are: To plan the procurement process To ensure that solicitation documents are complete and accurate To evaluate and select alternative providers To ensure that contracts are adequate, with sufficient performance controls and metrics To monitor and control deliverables Techniques: Some of the primary activities in procurement planning are: Planning procurement requirements Development of solicitation documents Evaluating providers and alternatives Developing contracts Monitoring and controlling deliveries Project Stakeholder Management Objectives: The primary objectives of Stakeholder Management are to Identify all the relevant stakeholders and understand their interest or role Understand and manage the expectations of stakeholders Manage and control stakeholder communications Manage and control stakeholder involvement Techniques: Because the objectives of Stakeholder Management are quite diverse, a wide range of techniques are required. Each objective will require different techniques. Project Integration Management Objectives: The primary objective of integration management is to see that the work of the project is completed successfully. Project integration management focuses on the specific tasks that ensure the project is coordinated, executed, and controlled properly. Quick Quiz Q: List the nine areas of the PMBOK. A: See above Q: What are the characteristics of a quality system? A: Easy to use, Fit for purpose, Robust, Reliable, Secure, Maintainable Q: What are the objectives of Scope Management? A: To define the scope, To prioritize the scope, To control the scope. Q: What are the objectives of Cost Management? A: To accurately estimate the costs, To predict cash flows, To control expenditures, To record expenditures. Classroom Activities Obviously working through some of the exercises with Microsoft Project is an effective classroom activity. PMBOK activity: One fun activity is to plan a wedding activity (like the movie the Wedding Planner...) Have each group select one PMBOK area and develop a plan for that area for a project. The project is – You are a wedding planner and you have been asked to plan ...’s wedding. How would you go about to – and give some examples of each 1. Determine and control the scope 2. Determine and control the schedule 3. Estimate the budget and control the cost 4. Determine and control the risks 5. Determine who needs to be notified and how (communication) 6. Determine resources 7. Determine and control quality (determine what things need to be checked and how) 8. Determine procurement and how to monitor/control 9. Determine who the stakeholders are and how to manage their involvement Once that is done have the groups identify tasks and build a WBS. Next they can put them on a schedule. Finally, you can use their tasks to enter them into MS Project. For this activity, the answers are not important. It is the process and the learning that is important. So after each section, discuss the process and answer questions. Another way is to allow students to ask questions out loud as they are working. Another learning approach is to have one or two teams show their WBS, and then you and the rest of the class can critique it. (Of course, this is always a challenge for any teacher—to bring out the salient teaching points and to keep the discussion from either being too shallow (It looks good. They did a good job.) or too nit-picky. Troubleshooting Tips The basic concepts of Net Present Value are normally easily understood. Most students will have had experience in their accounting classes. Sometimes students have trouble understanding early start time and late start time. Doing a couple of examples in class will facilitate learning. Microsoft Project mostly requires experimentation and practice. Most students are technology savvy and pick this up rapidly. Discussion Questions 2. Discussion on Project Management Principles Using the project management principles and responsibilities presented in this chapter, describe how the systems analyst can help with project management tasks. Also, describe how a new employee can contribute to the tasks. What would the new employee need to know in order to help project management? The set of skills for a systems analyst in Chapter 1 can also be used to assist the discussion. How much of the project manager’s responsibility is in managing the project, and how much is in managing people on the project? The systems analyst plays a crucial role in project management by leveraging their expertise in both technical and business domains to facilitate successful project outcomes. Here's how a systems analyst can contribute to project management tasks, and how a new employee can also contribute with the right knowledge and skills: Contributions of the Systems Analyst: 1. Requirements Gathering and Analysis: • The systems analyst can help identify and document project requirements by conducting interviews, workshops, and surveys with stakeholders. • They analyze requirements to ensure they align with business goals, are feasible within project constraints, and meet user needs. 2. Project Planning and Scope Management: • The systems analyst assists in creating project plans, defining scope, and estimating resources, timelines, and costs. • They collaborate with stakeholders to prioritize requirements and manage scope changes throughout the project lifecycle. 3. Risk Management: • Systems analysts identify potential risks and issues that may impact project success and develop mitigation strategies to address them. • They monitor risk factors and implement contingency plans to minimize disruptions and ensure project continuity. 4. Communication and Stakeholder Engagement: • Systems analysts facilitate communication among project stakeholders, ensuring alignment of expectations and fostering collaboration. • They provide regular updates on project progress, milestones, and risks, and solicit feedback to maintain stakeholder engagement and support. 5. Quality Assurance and Testing: • The systems analyst collaborates with QA teams to develop test plans, scenarios, and acceptance criteria to validate system functionality. • They conduct reviews and inspections to ensure adherence to quality standards and requirements. 6. Change Management: • Systems analysts manage change requests by evaluating their impact on project scope, schedule, and resources. • They assess the feasibility of proposed changes and coordinate their implementation with relevant stakeholders. Contributions of a New Employee: 1. Assistance with Tasks: • A new employee can assist with various project management tasks, such as data collection, documentation, and coordination of meetings. • They can support requirements gathering efforts by conducting research, compiling data, and organizing information for analysis. 2. Learning and Skill Development: • A new employee should familiarize themselves with project management principles, methodologies, and tools used in the organization. • They can undergo training or mentorship to develop skills in areas such as communication, problem-solving, and stakeholder engagement. 3. Contribution to Team Dynamics: • A new employee brings fresh perspectives and ideas to the team, contributing to innovation and creativity in problem-solving. • They can actively participate in team discussions, share insights, and offer suggestions for process improvement. Project Manager's Responsibilities: • The project manager is primarily responsible for managing the project's scope, schedule, budget, and resources to ensure timely delivery of quality solutions that meet stakeholder expectations. • They oversee the execution of project tasks, monitor progress, identify risks and issues, and implement strategies to address them. • Additionally, the project manager is responsible for managing team dynamics, fostering collaboration, and providing leadership and direction to project team members. In summary, while the systems analyst plays a significant role in assisting with project management tasks, a new employee can also contribute effectively with the right knowledge, skills, and support. The project manager's responsibilities encompass both managing the project's activities and resources and managing the people involved, ensuring alignment with project objectives and successful delivery of project outcomes. 2. Small Group Exercise on Project Management Skills Divide the class into groups of three or four students. Each group should develop a list of ten skills that they think are important for project managers. The group should use weighted scoring to rate the skills on a scale of 1 – 10 (10 being the highest). Next, individual students should rate themselves on each of these skills, and discuss how to improve their weaknesses. Step 1: Divide Into Groups: • Divide the class into groups of three or four students. Step 2: Develop a List of Ten Skills: • Each group should brainstorm and develop a list of ten skills that they believe are important for project managers. These skills can include communication, leadership, time management, problem-solving, decision-making, risk management, stakeholder management, adaptability, organizational skills, etc. Step 3: Weighted Scoring: • Once the list of skills is developed, each group should assign a weighted score to each skill on a scale of 1 to 10, with 10 being the highest. • The weighted score should reflect the perceived importance of each skill in the context of project management. For example, a skill deemed crucial for project success may be assigned a higher weighted score, while less critical skills may receive a lower score. Step 4: Individual Self-Rating: • After assigning weighted scores to each skill, individual students should rate themselves on each skill based on their perceived proficiency or competency level. • Students can use the same scale of 1 to 10 to rate themselves, with 10 indicating high proficiency and 1 indicating low proficiency. Step 5: Discussion and Improvement Plan: • Once individual self-ratings are completed, students should discuss their ratings within their groups. • Students can identify areas where they rated themselves lower and discuss strategies for improving those skills. • Encourage students to share insights, experiences, and resources for skill development, such as workshops, online courses, books, or mentorship opportunities. • Groups can also brainstorm actionable steps and set goals for improving their project management skills over time. Step 6: Group Presentation: • Each group can present their list of skills, weighted scores, and self-ratings to the class. • Groups can share their insights, reflections, and improvement plans, fostering peer learning and collaboration. Step 7: Reflection and Feedback: • Facilitate a class discussion to reflect on the exercise and gather feedback from students. • Encourage students to share their thoughts on the importance of project management skills and the value of self-assessment and continuous improvement in their professional development journey. By conducting this small group exercise, students can gain a deeper understanding of essential project management skills, assess their own strengths and weaknesses, and develop actionable plans for skill enhancement and growth. Instructor Manual for Systems Analysis and Design in a Changing World John W. Satzinger, Robert B. Jackson, Stephen D. Burd 9781305117204, 9781111951641
Download
Close
Close
