Welcome to Project Management! In this video, I’ll talk about some basic
concepts of project management. So, the first question is, what is a project? According to PMI, a project is a temporary
endeavor undertaken to create a unique product, service, or result. The keywords are “temporary” and “unique”
in this definition. The major goal of a project is to meet customer
needs. There are 5 major characteristics of a project. First, it must have an established objective. For example, in a house building project,
the objective is to build a 3-bedroom house. Second, a project is temporary and must have
a defined life span with a start and an end. For the house building project, let’s say
it will take 6 months, starting in April and finishing in October. Third, a project will need cross-departmental
involvement in an organization. Building a house will need the participation
of a manager, masons, carpenters, electricians, plumbers, quality control specialists, etc. So, it’s combined efforts of a variety of
professionals. A project usually involves doing something
that has never been done before, something unique. Even basic projects that involve established
sets of routines and procedures require some degree of customization that makes them unique. Last, a project is usually associated with
time and budget constraints and performance requirements. These three also highlight a major responsibility
of a project manager–balancing the trade-offs among time, cost, and performance while ultimately
satisfying the customer. A project is not routine, repetitive work. Routine work typically requires doing the
same or similar work over and over. A project, however, is done only once, and
a new product, service, or result rolls out when the project is completed. A project will always require some degree
of innovation. On the left, I listed some examples of routine,
repetitive work; and on the right, I listed some project examples. Installing a new rooftop solar system for
your house is a project, but cleaning the solar panels every quarter is routine work. Shipping parts to a customer based on the
order request is daily routine work, but deploying a system with software and hardware to automate
the shipping process in a factory is a project. Designing a new generation of Apple iPhone
is a project, but mass production of iPhones on an assembly line becomes routine work. Many people are confused and don’t know the
difference between Project Management and Program Management and incorrectly used them
interchangeably. According to PMI, a program is a group of
related projects managed in a coordinated way to obtain benefits and control not available
from managing them individually. These related projects are managed together
to accomplish a common goal over an extended period of time. You can think of a program being at a higher
level than projects. The major differences between a program and
a project lie in scale and time span. For example, within the disaster response
program following a flood, we may have a rescuing project to get people out from houses surrounded
by flood; we may have another project to provide first aid and medical treatment; a third project
in the program could be building temporary shelter for people who lost their homes. Transporting and distributing food and clean
water to the shelter is another project. Each project within this program is led by
a project manager, and each of these projects adds some benefits and value to the overall
disaster relief program. Each project only last for a few weeks, but
the entire program may last for several months. Coordinating and sharing resources among different
projects is a major challenge of program management. Each project has a limited life span and can
be divided into different stages based on the changes in the work focus and level of
effort over its life. A general project life cycle model is shown
in this figure. According to this model, the life cycle is
divided into four stages, defining, planning, executing, and closing. In the defining stage, the project objective
and specifications are defined. The project team is formed, and the responsibilities
of team members are assigned. Let’s use the example of building a house. The objective is to build a 3-bedroom house
within 6 months with a budget of $200,000 in Binghamton. We need to assemble a team of masons, carpenters,
electricians, plumbers, and a manager, each will be responsible for a part of the project. This stage only occurs at the beginning of
the project, and it doesn’t involve much effort. During the planning stage, the level of effort
increases, the project schedule, budget, and work activities have to be planned out and
maybe revised as project progresses. For example, we want to build the 3-bedroom
house in Binghamton within 6 months with a budget of $200,000. The work schedule of each team member is laid
out so they can conduct their part according to plan. The level of effort involved in this stage
is higher and lasts longer than the defining stage. The executing stage is the major portion of
the project work and involves the highest level of effort of the project team. For the house building project, this stage
represents that the house is actually being built. Time, cost, and specifications are closely
monitored, and future forecasts are made based on potential events in this stage and used
as measures to make adjustments if necessary. The effort level of the final closing stage
is much lower, and the duration is much shorter compared to the executing stage. The focus is shifted to transferring the final
deliverables to the customers, providing proper training, releasing project resources like
people and equipment so they will be available to other projects, and post-project review
and documentation. Project Manager is a challenging job. A project manager must make the best use of
the limited resources and make appropriate trade-offs between time, cost, and performance. Unlike functional managers, project managers
generally have only basic knowledge of some parts of the project. Therefore, he or she needs to integrate, direct,
and coordinate the project team and utilize the team members’ expertise to the fullest. He or she also works with a diverse group
of people like customers, vendors, suppliers, and contractors. The manager is responsible for the final result
of the project. To sum up, a project manager must induce the
right people at the right time to address the right issues and make the right decisions. Project management is rapidly becoming a standard
way of doing business. There are several important driving forces
behind this trend. One is the compression of the product life
cycle. Today, the product life cycle in high-tech
industries is 1 to 3 years on average. For example, Apple releases a new generation
of iPhone every year. But, 30 years ago, you would not be surprised
by product life cycles of 10 to 15 years. As a result, time to market for new products
with short life cycles has become increasingly important. Study shows a 6-month project delay can result
in a 33% loss in product market share. The growth in new knowledge has increased
the complexity of projects because projects tend to embrace the latest technology advances. Let’s watch a commercial video of Aspen Technology,
a company that provides software solutions and services to the process industries. Yes, projects love new technology, and technology
loves complexity. Project management is an effective way of
dealing with complexity. There is a world-wide movement towards sustainability
through reducing green-house gas emissions and utilizing renewable resources. Sustainability is defined by the United Nations
as “meeting the needs of the present without compromising the ability of future generations
to meet their own needs.” Modern businesses can no longer simply focus
on profit maximization without considering the impact to the environment and society. This new change must be reflected in the objectives
and techniques used to complete projects. One example of such effort is RE100. RE100 is a global corporate leadership initiative
that brings together influential companies committed to 100% renewable energy. Currently RE100 partners include 191 companies
like IKEA, 3M, Apple, Bank of America, BMW, Citi Bank, Coca Cola, eBay, Facebook, General
Motors, Goldman Sachs, Google, HP, Microsoft, Nike, Sony, Walmart, and many, many others. Watch this video to learn more about RE100. Increased competition in the business world
has urged companies to pay more attention to customer satisfaction. Also, customers no longer simply settle for
generic products and services. They want customized products and services
that meet their specific needs. This requires a much closer working relationship
with customers to ensure business success. This is an important factor that leads to
the increased use of project management. We have been talking about project management
from a project manager’s perspective. But from the organizational perspective, there
might be a portfolio of dozens, hundreds, or even thousands of projects going on concurrently. Each of these projects is at a different stage
of its life cycle. Portfolio management is imperative to carefully
plan and manage all these projects and support the mission of the entire organization. By definition, portfolio management is the
selection, prioritization, and control of an organization’s programs and projects in
line with its strategic objectives, available resources, and capacity to deliver. The goal is to balance change initiatives
and business-as-usual while optimizing return on investment. A common mistake made by some entry-level
project managers is that they got preoccupied with the planning and technical dimension
of project management and completely rely on project management software, and they become
obsessed with network diagrams, Gantt charts, and performance variances; they attempt to
manage a project from a distance. After you take this course, you will know
that real-world project management is far more than that. It consists of the formal, disciplined, purely
logical parts like defining the project scope and deliverables, developing the work breakdown
structure, scheduling and progress monitoring, resource allocation, budget control, writing
the status report, and so on. We call this the technical dimension of the
project management. It also consists of the much messier world
of implementation like shaping a project culture, motivating the personnel, resolving internal
conflicts, shaping customer expectations, sustaining political support of top management,
negotiating with their functional counterparts, monitoring subcontractors, and so on. We call this the sociocultural dimension of
project management. The sociocultural dimension focuses on creating
a temporary social system within a larger organizational environment that combines the
talents of a diverse group of professionals working to complete the project. This course focuses on both the science and
the art aspects of project management. Finally, let me give you an example of project
management that successfully integrates these two aspects. It’s called A Day in the Life of an Information
Systems Project Manager. Karen is a project manager of an information
systems project. Here is a list of her activities for a typical
business day. She arrives at the office building early. As she enters the office, she meets Adam,
a fellow project manager. They spend 10 minutes socializing and catching
up on personal news. It takes Karen 10 minutes to get to her office
and settle in. She then checks her voicemail and turns on
her computer. There are 3 voice messages, 9 email messages,
and 2 notes left on her desk. She visited one of her customers the day before
and didn’t get a chance to answer these messages. She spends 15 minutes reviewing her schedule
and the “to do” list for the day before responding to the important messages that
require immediate attention. Karen spends the next 25 minutes going over
project reports and preparing for the weekly project review meeting. Her boss, who just arrived at the office,
interrupts her. They spend 20 minutes discussing the project. The boss shares a rumor that one of Karen’s
team members was seen drinking alcohol in workplace. Karen tells him that she will keep an eye
on the team member. The 9am project review meeting starts 15 minutes
late because two team members have to finish a job for a client. Several people go to the cafeteria to get
coffee and doughnuts while others discuss last night’s football game. The team members arrive, and the remaining
45 minutes of the project review meeting surface project issues that have to be addressed and
assigned for action. After the meeting, Karen goes down the hallway
to meet with Debbie, another information systems project manager. They spend 30 minutes reviewing project assignments
since the two of them share personnel. Debbie’s project is behind schedule and
in need of help. They make a deal that should get Debbie’s
project back on track. She returns to her office and makes several
phone calls and returns several emails. Then she walks downstairs to visit her project
team to follow up on an issue that surfaced in the meeting earlier that morning. However, she is told that now the customer
requests features that were not in the original project scope statement. After listening patiently for about 20 minutes,
she tells her people that she will look into this right away. After she gets back to her office, she tries
to call her counterpart David at the client’s firm but is told that he is not expected back
from lunch for another hour. At this time, Carl drops by and says, “Wanna
go to lunch?” Carl works in the finance office and they
spend the next 30 minutes in the company cafeteria gossiping about internal politics. After lunch, Karen returns to her office,
answers a few more emails, and finally gets through to David. They spend 30 minutes going over the problem. David promises to do some investigation and
get back to Karen as soon as possible. After the phone call, Karen puts a “Do not
disturb” sign on her door and lies down in her office sofa. She listens to some light music on headphones. Then, she takes the elevator down to the third
floor and talks to the purchasing agent assigned to her project. They spend the next 30 minutes exploring ways
of getting necessary equipment to the project site earlier than planned. She finally authorizes express delivery. When she returns to her office, her calendar
reminds her that she is scheduled to participate in a conference call at 2:30pm. It takes 15 minutes for everyone to get online. During this time, Karen catches up on some
more emails. The next hour is spent exchanging information
about the technical requirements associated with a new version of a software package they
are using on information systems projects like hers. After the conference call, Karen decides to
stretch her legs and goes on a walk down the hallway where she engages in brief conversations
with various co-workers. When she returns to her office, she finds
that David has left a message for her to call him back ASAP. According to David’s people, Karen’s firm’s
marketing representative made certain promises about specific features the system would provide. He doesn’t know how this communication breakdown
occurred, but his people are pretty upset about the situation. Karen thanks David for the information and
immediately takes the stairs to where the marketing group is located. She asks to see Linda, a senior marketing
manager. She waits 10 minutes before being invited
into Linda’s office. After a heated discussion, she leaves 40 minutes
later with Linda agreeing to talk to her people about what was promised and what was not promised. She goes downstairs to her team to give them
an update on what is happening. They spend 30 minutes reviewing the impact
the client’s new-feature requests may have on the project schedule. After that, she heads upstairs to her boss’s
office and spends 20 minutes updating him on key events of the day. She returns to her office and spends 30 minutes
reviewing emails and project documents. She logs on to the Microsoft project schedule
and spends the next 30 minutes working with “what-if” scenarios. Finally, she reviews tomorrow’s schedule
and writes some personal reminders before starting her commute back home. This case shows a glimpse of what it’s like
to be a project manager. In Karen’s case, being a project manager is
more social than technical. She spends the majority of her time interacting
with various people who impact the project. When evaluating Karen’s performance for the
day, people who have little work experience may argue that she is inefficient and does
not have control over her time. Others with work experience may argue that
this is the nature of her job. She is appropriately spending her time managing
relationships and keeping on top of things that affect the project. She must be a multi-tasker and split her time
into smaller chunks to touch upon almost all the aspects of her project, instead of doing
just one thing for the entire day without getting interrupted. Some people may think Karen devoting lunch
time to gossiping and taking time to relax and listen to music are inappropriate behaviors
at work. Other people may argue that politics is ubiquitous
in the business world and listening to music will refresh her and keep her productive for
the afternoon work. Overall, Karen’s day highlights three key
functions project managers spend their time performing. First one is building and sustaining interpersonal
relations. Project managers have to network and develop
good working relations with team members and other project stakeholders. Second one is information gathering and dissemination. Project managers are the information hub for
their projects. They are in constant communication with various
stakeholders, collecting information from various sources, and sending it to those who
need to know. Third one is decision-making. Project managers consult with various people
to make decisions necessary to complete the project. To sum up, in this video, we talked about
what project management is, why it’s crucial in today’s world, how to distinguish projects
from routine operations, how to identify the different stages of a project life cycle,
and why managing projects involves balancing the technical and socio-cultural dimensions. This is Yong Wang, and I’ll see you in the
next video.

Project Management 02: What is Project Management
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