A
Short Introduction to Project Management
By Bob
Hugg
We must accept that all
Project Management (PM) plans are estimates, or nothing wonderful may come of
the tale we are about to share (regards to Charles Dickens from his 1837
classic A Christmas Carol). Project
Management is the often misunderstood discipline that, like meteorology, gets
by with educated guesses that are frequently wrong. It is, at its finest, close
to the mark but often is altogether far from the mark. It is the art and
science of crafting reliable estimates out of that most unreliable source,
human behavior. Why, then, use Project Management at all? As Winston Churchill
said (when speaking of democracy) it is a terrible choice except for all the
others. In other words, an organized and well thought out attempt to control
the fire is better than joining in the fun and watching
In
the broadest sense, PM is more a management philosophy than any single
methodology. It simply says that efficient
management yields effective results. A little closer look and the
definition becomes the act of arranging tasks and resources for the most
efficient and productive result. Yet more tightly defined, it becomes a quest
whose guiding star is management of resources
& constraints to meet a goal in
as efficient a manner as possible. Spock (
It
is for this reason, this delicate balancing act, that PM is controversial. By
nature it sets expectations and creates a structure of accountability. It
relies on tangible estimates of costs, duration, and effort. It asks 2 simple
questions which can be devilishly difficult to answer:
1)
What tasks are necessary to do this project?
2)
How long will it take to do those tasks?
Based
on the answer to those 2 questions, PM answers 4 basic questions that managers
the world over have asked since Noah started on his ark:
1)
How long will this project take?
2)
What will it take to do this project?
3)
Can it be completed sooner?
4)
How likely is it that it will be done on time?
PM
becomes controversial because even the best estimates are just that, estimates.
A project that takes longer than estimated also costs more than is estimated
and the final product is not available when desired. As a result, the spotlight
shines brightly on workers and supervisors alike, an uncomfortable experience
at best. PM becomes, in many ways, expectation management. It balances the
expectations of the end-user (when it can be done and what the project can do)
against the expectations of the workers (when it can’t be done and what
the project can’t do). PM attempts to manage not only time, people and
money, it attempts to manage scope. Scope
is simply a specific definition of what the project will and will not entail.
PM
is valuable as a means to define a project and its tasks and to provide a
common sheet of music for workers, stakeholders and managers alike. It is a
wonderful way to get and stay organized and, once a project plan is drafted,
forces all involved to ask and answer a hard question:
is this the goal we are trying to meet and is the price worth the goal? It is a
very good way to identify the requirements and risks of a project long before a
project is started or even agreed upon.
PM is a great group communication exercise in “what if.” How
much, how long, how many, how complicated, how likely, how does it affect, etc.
When faced with these answers, many well intentioned projects are demoted to
“good ideas if we ever have extra time, money, etc” that are put on
the shelf. Better to define the requirements of a project before resources are
committed than to cancel a project in the bright light of the real
picture. According to a 1998 survey of
managers across the U.S, 30% of all projects started are cancelled before
completion. PM provides an alternative to blindly embarking on projects. It
provides a clearly defined goal, a clear (but estimated) sense of costs, tasks,
and time. It is for that reason that PM has been used in one form or another
for thousands of years. Traditional PM as practiced today is a much newer
entity, not quite 100 years old, and is a more refined process than that used
by the ancient Egyptians.
The
first standardized approach to PM was crafted by Henry Gantt with the
introduction of bar charts that showed task durations and a crude (but not
intuitive) relationship between tasks. In 1917, as
Figure 1, Sample Gantt chart
As
the arms race became a central facet of the cold war, the need for efficiency
in the military-industrial complex became an obsession, particularly in the
face of sputnik, the Soviet Union’s crude little satellite that beat
Figure 2, Sample PERT Diagram
PERT
is a probabilistic model – it
derives its estimates based on the probability of occurrence. It is based on a
beta distribution – a flexible yet continuous distribution that places
value on the event itself and the interval between events. Because it accounts
for a degree of randomness, it is highly useful in determining likely event
durations – time estimates for tasks. In other words, with user-supplied
estimates (pessimistic, optimistic and most likely) PERT can derive a task
duration with a high probability of accuracy (It is still an estimate, however,
because it is only as good as the estimates used in the computation). PERT was
a major PM breakthrough because it provided a standardized way to quantify
probable task durations. It is a scientific approach to balancing the known
(user supplied estimates) with the unknown (the probability of accuracy of
those estimates) in order to achieve a more predictable result.
At
the same time, industry in the private sector created a competing PM model,
Critical Path Method (CPM). Unlike PERT, CPM is a deterministic model – based on the concept that previous
events, not probability, determine events. Like PERT, CPM identifies a critical path of tasks (hence the name)
that reflect the longest path through the network of tasks. Unlike PERT, CPM
analyzes only the longest chain of critical tasks. These critical tasks determine the overall
length of the project. If these tasks can be shortened, the project will be
shortened; tasks not on this critical path will have no effect on the project
duration. Unlike PERT, CPM places value on the sequence of
events and does not recognize other variables. In a very simplified
paraphrase, CPM states that if task A takes 10 units,
task B takes 5 units, and task C takes 8 units, the project will take 23
units. CPM accounts for task in sequence and is useful in easily determining
bottleneck points or areas that can be manipulated for improving the speed of
project completion (crashing).
Because
they share similarities, PERT and CPM can be (and frequently are) used
together. PERT and CPM both assume that a small set of activities, which make
up the longest path through the activity network control the entire
project. PERT and CPM also share six key assumptions:
1)
All tasks have distinct begin and end points
2)
All estimates can be mathematically derived
3)
Tasks must be able to be arranged in a defined
sequence that produces a pre-defined result
4)
Resources may be shifted to meet need
5)
Cost and time share a direct relationship (Cost of
each activity is evenly spread over time)
6)
Time, of itself, has no value
When
used together, PERT and CPM can provide:
1)
A range of time estimates (PERT)
2)
Likely time estimates (PERT and CPM)
3)
Cost estimates (CPM)
4)
Time and costs if crashed (CPM)
5)
Probabilities of completion on time for a range of
times (PERT)
6)
A clear path of tasks that are critical to the
project (PERT and CPM)
7)
A central focus for solid communications on
project issues (PERTT and CPM)
PERT and CPM have remained unchanged since 1958 with the notable
exception of the introduction of the Work Breakdown Structure (WBS).
WBS is a detailed, hierarchical (from general to specific) tree
structure of deliverables and tasks that need to be performed to complete a
project. The purpose of a WBS is to identify the actual tasks to
be done in a project. WBS serves as the basis for much of project planning.
Work breakdown structure is, perhaps, the most common project management tool;
it was created by the
Figure 3, Sample WBS
PERT and CPM share several weaknesses that add to the PM
controversy. Both consider only causal dependencies,
where 1 task must be completed before another can begin (have to bake bread
before you can make a sandwich). Other dependencies, such as resource dependencies, where a task is limited by
availability of resources (more bread can be baked by 2 bakers, but only 1 is
available) or discretionary dependencies (optional task sequence preferences
that, though not required, may reflect organizational preferences) are not
considered. The range of assumptions required for PERT and CPM to be effective,
and the lack of acknowledgement of dependencies, has led to newer PM theories
which are not mainstream and are considered experimental.
New PM tools and methodologies have evolved which make
scheduling and analysis easier and less time consuming. Some methodologies are mainstream and some are experimental; most are
industry-specific. Tools range from the simple and generic (Excel is widely
used for small projects) to the grandiose (Scitor
Scheduler/Communicator is common in software development). There are software
PM packages that are designed to fit every niche and unique industry
requirement from healthcare to aerospace engineering and everything in between.
Prices range from less than $100 to many thousands of dollars per copy. The
most commonly used package is Project by Microsoft Corporation.
While they are diverse in their add-ons (that reflect the specific
industry served) all share a common foundation: they are all based heavily on
PERT/CPM. In most cases, unless a
person is working on enormous and complex projects, these packages will be
overkill. While using Excel could suffice, it has no inherent capability to
reflect relationships, generate reports or highlight trouble areas. MS Project,
because of its (relatively) user friendly nature, lower cost, and high degree
of customizability is a common choice in tools. Because MS Project does not calculate
probabilities of timely completion, a manager should remain well versed in
doing so manually or using excel. These techniques will be covered in detail in
the block on PERT calculations.
PM philosophy is a valuable mindset for managers at all levels
but is just one consideration of many. The selection of a tool, such as Project
or Excel, or the selection of a technique, such as PERT or CPM,
should be balanced against the needs of the organization as a whole and the
specific goal of the project. No tool should become the focus; the project goal
and the best way to achieve it must be the deciding factor, along with the
organizational personality.
Resources
Used in This Unit
Goldratt,
Eli, Dr., The Goal: A Process of Ongoing Improvement,
Great
MS Project, by Microsoft Corporation.
PM Body of Knowledge (PMBOK),
Project Management Institute (PMI)
<Project
Management Institute Website>.
Render, Barry and Stair Jr., Ralph M. -
Quantitative Analysis for Management,
US National Performance Survey, The
Standish Group, 1998.
Verma,
Vijay K., Managing the Project Team: The Human Aspects of Project Management,
Wiest,
Jerome D., and Levy, Ferdinand K., A Management Guide to PERT/CPM,
© 1996 A.J.Filipovitch
Revised 11 March 2005