Effective Project Management FIFTH EDITION JAMES P. CLEMENTS West Virginia University JACK GIDO Penn State University *\ SOUTH-WESTERN t% CENGAGE Learning- Australia Brazil «Japan Korea Mexico Singapore Spain United Kingdom United States
Brief Contents 1 Project Management Concepts 2 PARI 1 Initiating a Project 28 2 Identifying and Selecting Projects 30 3 Developing Project Proposals 54 PART 2 Planning, Performing, and Controlling the Project 86 4 Defining Scope, Quality, Responsibility, and Activity Sequence 88 5 Developing the Schedule 128 6 Resource Utilization 194 7 Determining Costs, Budget, and Earned Value 224 CHAPTER 8 Managing Risk 268 CHAPTER 9 Closing the Project 282 PART 3 People: The Key to Project Success 298 CHAPTER 10 The Project Manager 300 CHAPTER 11 The Project Team 328 1 2 Project Communication and Documentation 368 CHAPTER 1 3 Project Management Organizational Structures 398 Case Studies 417 Appendix A Project Management Information Systems 458 Appendix В Project Management Websites 468 Appendix С Project Management Associations around the Globe 469 Appendix D Acronyms 471 Reinforce Your Learning Answers 472 Glossary 486 Index 493 V
Contents Preface About the Authors xiii xxv CHAPTER 1 Project Management Concepts 2 Project Attributes 4 Balancing Project Constraints 6 Project Life Cycle 9 Initiating 10 Planning 11 Performing 11 Closing 13 Project Management Process 14 Global Project Management 21 Project Management Associations 22 Benefits of Project Management 22 Summary 24 Questions 25 Internet Exercises 26 References 27 PARTI Initiating a Project 28 CHAPTER 2 Identifying and Selecting Projects. Project Identification 32 Project Selection 33 Project Charter 36 Preparing a Request for Proposal 41 Soliciting Proposals 47 Summary 49 Questions 50 Internet Exercises 51 References 51 30
Contents VÜ CHAPTER 3 Developing Project Proposals 54 Building Relationships with Customers and Partners 57 Pre-RFP/Proposal Marketing 59 Decision to Develop a Proposal 59 Creating a Winning Proposal 61 Proposal Preparation 63 Proposal Contents 64 Technical Section 64 Management Section 66 Cost Section 67 Pricing Considerations 69 Simplified Project Proposal 70 Proposal Submission and Follow-Up 73 Customer Evaluation of Proposals 73 Contracts 76 Fixed-Price Contracts 76 Cost-Reimbursement Contracts 76 Contract Terms and Conditions 77 Measuring Proposal Success 78 Summary 80 Questions 82 Internet Exercises 83 References 83 PART 2 Planning, Performing, and Controlling the Project 86 CHAPTER 4 Defining Scope, Quality, Responsibility, and Activity Sequence 88 Establish Project Objective 90 Define Project Scope 91 Plan for Quality 95 Create Work Breakdown Structure 97 Assign Responsibility 101 Define Activities 103 Sequence Activities 104 Network Principles 104 Create Network Diagram 106 Planning for Information Systems Development 110 An IS Example: Internet Applications Development for ABC Office Designs 111 Project Management Information Systems 115 Summary 118 Questions 119 Internet Exercises 120 References 120 Appendix: Microsofl Project 121
CHAPTER 5 Developing the Schedule 128 Estimate Activity Resources 131 Estimate Activity Durations 132 Establish Project Start and Finish Times 133 Develop Project Schedule 134 Earliest Start and Finish Times 134 Latest Start and Finish Times 138 Total Slack 140 Critical Path 142 Free Slack 145 Bar Chart Format 147 Project Control Process 148 Effects of Actual Schedule Performance 150 Incorporate Changes into Schedule 151 Update Project Schedule 152 Control Schedule 153 Scheduling for Information Systems Development 158 An IS Example: Internet Applications Development for ABC Office Designs (Continued) 160 Project Management Information Systems 163 Summary 166 Questions 171 Internet Exercises 173 References 173 Appendix 1: Probabilistic Activity Durations 175 Appendix 2: Microsoft Project 184 CHAPTER 6 Resource Utilization 194 Resource-Constrained Planning 196 Resource Requirements Plan 198 Resource Leveling 200 Resource-Limited Scheduling 202 Resource Requirements for Information Systems Development 207 An IS Example: Internet Applications Development for ABC Office Designs (Continued) 208 Project Management Information Systems 210 Summary 211 Questions 212 Internet Exercises 213 References 213 Appendix: Microsoft Project 215
Contents ix CHAPTER 7 Determining Costs, Budget, and Earned Value 224 Estimate Activity Costs 227 Determine Project Budget 229 Aggregate Total Budgeted Cost 229 Develop Cumulative Budgeted Cost 231 Determine Actual Cost 233 Actual Cost 233 Committed Costs 233 Compare Actual Cost to Budgeted Cost 234 Determine Value of Work Performed 235 Analyze Cost Performance 238 Cost Performance Index 239 Cost Variance 240 Estimate Cost at Completion 240 Control Costs 242 Manage Cash Flow 243 Cost Estimating for Information Systems Development 245 An IS Example: Internet Applications Development for ABC Office Designs (Continued) 246 Project Management Information Systems 246 Summary 249 Questions 251 Internet Exercises 252 References 253 Appendix 1: Time-Cost Trade-Off 255 Appendix 2: Microsoft Project 258 CHAPTER 8 Managing Risk 268 Identify Risks 271 Assess Risks 272 Plan Risk Responses 273 Monitor Risks 274 Managing Risks for Information Systems Development 276 An IS Example: Internet Applications Development for ABC Office Designs (Continued) 276 Summary 278 Questions 278 Internet Exercises 279 References 279
CHAPTER 9 Closing the Project 282 Project Closing Actions 284 Final Payments 284 Staff Recognition and Evaluation 285 Post-Project Evaluation 286 Lessons Learned 288 Archive Project Documents 289 Customer Feedback 289 Early Project Termination 290 Summary 294 Questions 294 Internet Exercises 295 References 295 PART 3 People: The Key to Project Success 298 CHAPTER 1 0 The Project Manager 300 Project Manager Responsibilities 302 Planning 303 Organizing 303 Controlling 303 Project Manager Skills 304 Leadership Ability 304 Ability to Develop People 307 Communication Skills 308 Interpersonal Skills 310 Ability to Handle Stress 311 Problem-Solving Skills 312 Negotiating Skills 312 Time Management Skills 314 Developing Project Manager Competence 314 Delegation 315 Managing Changes 319 Summary 324 Questions 325 Internet Exercises 326 References 326
Contents xi CHAPTER I 1 The Project Team 328 Acquiring the Project Team 331 Project Team Development 332 Forming 333 Storming 334 Norming 335 Performing 335 Project Kickoff Meeting 336 Effective Project Teams 338 Characteristics of Effective Teams 338 Barriers to Team Effectiveness 339 Effective Team Members 343 Team Building 344 Valuing Team Diversity 345 Ethical Behavior 349 Conflict on Projects 352 Sources of Conflict 352 Handling Conflict 354 Problem Solving 355 A Nine-Step Approach to Problem Solving 355 Brainstorming 358 Time Management 359 Summary 362 Questions 365 Internet Exercises 365 References 366 CHAPTER 1 2 Project Communication and Documentation 368 Personal Communication 370 Verbal Communication 370 Written Communication 372 Effective Listening 373 Meetings 374 Types of Project Meetings 374 Effective Meetings 377 Presentations 382 Prepare the Presentation 382 Deliver the Presentation 383 Reports 384 Types of Project Reports 384 Useful Reports 386 Track Document Changes 387 Project Communication Plan 388
Collaborative Communication Tools 390 Summary 393 Questions 395 Internet Exercises 396 References 396 CHAPTER 1 3 Project Management Organizational Structures 398 Functional Organizational Structure 400 Autonomous Project Organizational Structure 402 Matrix Organizational Structure 405 Advantages and Disadvantages of Organizational Structures 409 Functional Organizational Structure 410 Autonomous Project Organizational Structure 410 Matrix Organizational Structure 411 Summary 413 Questions 414 Internet Exercises 415 References 415 Case Study 417 Appendix A Project Management Information Systems 458 Project Management Information Systems Features 458 Criteria for Selecting Project Management Information Systems 464 Advantages of Using Project Management Information Systems 465 Concerns about Using Project Management Information Systems 466 Project Management Information Systems Vendors 466 Summary 466 Questions 467 Internet Exercises 467 References 467 Appendix В Project Management Websites 468 Appendix С Project Management Associations around the Globe 469 Appendix D Acronyms 471 Reinforce Your Learning Answers 472 Glossary 486 Index 493