History of Project Management

As a discipline, Project Management developed from different fields of application including construction, engineering, and defence. In the United States, the forefather of project management is Henry Gantt, called the father of planning and control techniques, who is famously known for his use of the "bar" chart as a project management tool, for being an associate of Frederick Winslow Taylor's theories of scientific management^[1], and for his study of the work and management of Navy ship building. His work is the forerunner to many modern project management tools including the work breakdown structure (WBS) and resource allocation.

The 1950s marked the beginning of the modern project management era. Again, in the United States, prior to the 1950s, projects were managed on an ad hoc basis using mostly Gantt Charts, and informal techniques and tools. At that time, two mathematical project scheduling models were developed: (1) the "Program Evaluation and Review Technique" or PERT, developed by Booz-Allen & Hamilton as part of the United States Navy's (in conjunction with the Lockheed Corporation) Polaris missile submarine program^[2]; and (2) the "Critical Path Method" (CPM) developed in a joint venture by both DuPont Corporation and Remington Rand Corporation for managing plant maintenance projects. These mathematical techniques quickly spread into many private enterprises.

In 1969, the Project Management Institute (PMI) was formed to serve the interest of the project management industry. The premise of PMI is that the tools and techniques of project management are common even among the widespread application of projects from the software industry to the construction industry. In 1981, the PMI Board of Directors authorized the development of what has become A Guide to the Project Management Body of Knowledge (PMBOK Guide), containing the standards and guidelines of practice that are widely used throughout the profession. The International Project Management Association (IPMA), founded in Europe in 1967, has undergone a similar development and instituted the IPMA Project Baseline. Both organisations are now participating in the development of a ISO project management standard.

Definitions

The Project Manager

Project management is quite often the province and responsibility of an individual project manager. This individual seldom participates directly in the activities that produce the end result, but rather strives to maintain the progress and productive mutual interaction of various parties in such a way that overall risk of failure is reduced.

A project manager is often a client representative and has to determine and implement the exact needs of the client, based on knowledge of the firm he/she is representing. The ability to adapt to the various internal procedures of the contracting party, and to form close links with the nominated representatives, is essential in ensuring that the key issues of cost, time, quality, and above all, client satisfaction, can be realised.

In whatever field, a successful project manager must be able to envision the entire project from start to finish and to have the ability to ensure that this vision is realised.

Any type of product or service —buildings, vehicles, electronics, computer software, financial services, etc.— may have its implementation overseen by a project manager and its operations by a product manager.

The Traditional Triple Constraints

Like any human undertaking, projects need to be performed and delivered under certain constraints. Traditionally, these constraints have been listed as scope, time, and cost. These are also referred to as the Project Management Triangle, where each side represents a constraint. One side of the triangle cannot be changed without impacting the others. A further refinement of the constraints separates product 'quality' or 'performance' from scope, and turns quality into a fourth constraint.

The time constraint refers to the amount of time available to complete a project. The cost constraint refers to the budgeted amount available for the project. The scope constraint refers to what must be done to produce the project's end result. These three constraints are often competing constraints: increased scope typically means increased time and increased cost, a tight time constraint could mean increased costs and reduced scope, and a tight budget could mean increased time and reduced scope.

The discipline of project management is about providing the tools and techniques that enable the project team (not just the project manager) to organise their work to meet these constraints.

Another approach to project management is to consider the three constraints as finance, time and human resources. If you need to finish a job in a shorter time, you can throw more people at the problem, which in turn will raise the cost of the project, unless by doing this task quicker we will reduce costs elsewhere in the project by an equal amount.

Time

For analytical purposes, the time required to produce a deliverable is estimated using several techniques. One method is to identify tasks needed to produce the deliverables documented in a work breakdown structure or WBS. The work effort for each task is estimated and those estimates are rolled up into the final deliverable estimate.

The tasks are also prioritised, dependencies between tasks are identified, and this information is documented in a project schedule. The dependencies between the tasks can affect the length of the overall project (dependency constrained), as can the availability of resources (resource constrained). Time is not considered a cost nor a resource since the project manager cannot control the rate at which it is expended. This makes it different from all other resources and cost categories.

Cost

Cost to develop a project depends on several variables including (chiefly): labour rates, material rates, risk management, plant (buildings, machines, etc.), equipment, and profit. When hiring an independent consultant for a project, cost will typically be determined by the consultant's or firm's per diem rate multiplied by an estimated quantity for completion.

Scope

Requirements specified for the end result. The overall definition of what the project is supposed to accomplish, and a specific description of what the end result should be or accomplish. A major component of scope is the quality of the final product. The amount of time put into individual tasks determines the overall quality of the project. Some tasks may require a given amount of time to complete adequately, but given more time could be completed exceptionally. Over the course of a large project, quality can have a significant impact on time and cost (or vice versa).

Together, these three constraints have given rise to the phrase "On Time, On Spec, On Budget". In this case, the term "scope" is substituted with "spec(ification)".

Project Management Activities

Project Management is composed of several different types of activities such as:

1. Planning the work or objectives
2. Analysis & design of objectives and events
3. Assessing and controlling risk (or Risk Management)
4. Estimating resources
5. Allocation of resources
6. Organising the work
7. Acquiring human and material resources
8. Assigning tasks
9. Directing activities
10. Controlling project execution
11. Tracking and reporting progress
12. Analysing the results based on the facts achieved
13. Defining the products of the project
14. Forecasting future trends in the project
15. Quality Management
16. Issues Management
17. Issue solving
18. Defect prevention
19. Project closure
20. Communicating to stakeholders
21. Increasing/ decreasing a company's workers

Project Objectives

Project objectives define target status at the end of the project, reaching of which is considered necessary for the achievement of planned benefits. They can be formulated as S.M.A.R.T.

The evaluation (measurement) occurs at the project closure. However a continuous guard on the project progress should be kept by monitoring and evaluating.

Project Management Artefacts

Most projects, to be successful, must adequately document objectives and deliverables. These documents are a mechanism to align sponsors, clients, and project team's expectations.

1. Project Charter
2. Business case/Feasibility Study
3. Scope Statement / Terms of reference
4. Project management plan / Project Initiation Document
5. Work Breakdown Structure
6. Change Control Plan
7. Risk Management Plan
8. Risk Breakdown Structure
9. Communications Plan
10. Governance Model
11. Risk Register
12. Issue Log
13. Action Item List
14. Resource Management Plan
15. Project Schedule
16. Status Report
17. Responsibility assignment matrix
18. Database of lessons learned
19. Stakeholder Analysis

These documents are normally hosted on a shared resource (i.e., intranet web page) and are available for review by the project's stakeholders (except for the Stakeholder Analysis, since this document comprises of personal information regarding certain stakeholders. Only the Project Manager has access to this analysis). Changes or updates to these documents are explicitly outlined in the project's configuration management (or change control plan).

Project Control Variables

Project Management tries to gain control over variables such as risk:

Risk 

Potential points of failure: Most negative risks (or potential failures) can be overcome or resolved, given enough planning capabilities, time, and resources. According to some definitions (including PMBOK Third Edition) risk can also be categorised as "positive--" meaning that there is a potential opportunity, e.g., complete the project faster than expected.

Customers (either internal or external project sponsors) and external organisations (such as government agencies and regulators) can dictate the extent of three variables: time, cost, and scope. The remaining variable (risk) is managed by the project team, ideally based on solid estimation and response planning techniques. Through a negotiation process among project stakeholders, an agreement defines the final objectives, in terms of time, cost, scope, and risk, usually in the form of a charter or contract.

To properly control these variables a good project manager has a depth of knowledge and experience in these four areas (time, cost, scope, and risk), and in six other areas as well: integration, communication, human resources, quality assurance, schedule development, and procurement.

Approaches

There are several approaches that can be taken to managing project activities including agile, interactive, incremental, and phased approaches.

Regardless of the approach employed, careful consideration needs to be given to clarify surrounding project objectives, goals, and importantly, the roles and responsibilities of all participants and stakeholders.

The Traditional Approach

A traditional phased approach identifies a sequence of steps to be completed. In the traditional approach, we can distinguish 5 components of a project (4 stages plus control) in the development of a project:

1. project initiation stage;
2. project planning or design stage;
3. project execution or production stage;
4. project monitoring and controlling systems;
5. project completion stage.

Not all the projects will visit every stage as projects can be terminated before they reach completion. Some projects probably don't have the planning and/or the monitoring. Some projects will go through steps 2, 3 and 4 multiple times.

Many industries utilise variations on these stages. For example, in bricks and mortar architectural design, projects typically progress through stages like Pre-Planning, Conceptual Design, Schematic Design, Design Development, Construction Drawings (or Contract Documents), and Construction Administration. In software development, this approach is often known as 'waterfall development' i.e one series of tasks after another in linear sequence. In software development many organizations have adapted the Rational Unified Process (RUP) to fit this methodology, although RUP does not require or explicitly recommend this practice. Waterfall development can work for small tightly defined projects, but for larger projects of undefined or unknowable scope, it is less suited. Because software development is often the realisation of a new or novel product, this method has been widely accepted as ineffective for software projects where requirements are largely unknowable up front and susceptible to change. While the names may differ from industry to industry, the actual stages typically follow common steps to problem solving--defining the problem, weighing options, choosing a path, implementation and evaluation.

Rational Unified Process

1. Inception - Identify the initial scope of the project, a potential architecture for the system, and obtain initial project funding and stakeholder acceptance.
2. Elaboration - Prove the architecture of the system.
3. Construction - Build working software on a regular, incremental basis which meets the highest-priority needs of project stakeholders.
4. Transition - Validate and deploy the system into the production environment

Temporary Organisation Sequencing Concepts

1. Action-based entrepreneurship
2. Fragmentation for commitment-building
3. Planned isolation
4. Institutionalised termination

Critical Chain

Critical chain is an extension to the traditional critical path method.

In critical studies of project management, it has been noted that several of these fundamentally PERT-based models are not well suited for the multi-project company environment of today. Most of them are aimed at very large-scale, one-time, non-routine projects, and nowadays all kinds of management are expressed in terms of projects. Using complex models for "projects" (or rather "tasks") spanning a few weeks has been proven to cause unnecessary costs and low manoeuvrability in several cases. Instead, project management experts try to identify different "lightweight" models, such as Extreme Programming for software development and Scrum techniques. The generalisation of Extreme Programming to other kinds of projects is extreme project management, which may be used in combination with the process modelling and management principles of human interaction management.

Event Chain Methodology

Event chain methodology is the next advance beyond critical path method and critical chain project management.

Event chain methodology is an uncertainty modelling and schedule network analysis technique that is focused on identifying and managing events and event chains that affect project schedules. Event chain methodology helps to mitigate the negative impact of psychological heuristics and biases, as well as to allow for easy modelling of uncertainties in the project schedules. Event chain methodology is based on the following major principles.

Process-Based Management

Also furthering the concept of project control is the incorporation of process-based management. This area has been driven by the use of Maturity models such as the CMMI (Capability Maturity Model Integration) and ISO/IEC15504 (SPICE - Software Process Improvement and Capability Determination), which have been far more successful.

Agile project management approaches based on the principles of human interaction management are founded on a process view of human collaboration. This contrasts sharply with traditional approach. In the agile software development or flexible product development approach, the project is seen as a series of relatively small tasks conceived and executed as the situation demands in an adaptive manner, rather than as a completely pre-planned process.

Project Systems

As mentioned above, traditionally, project development includes five elements: control systems and four stages.

Project Control Systems

Project control is that element of a project that keeps it on-track, on-time, and within budget. Project control begins early in the project with planning and ends late in the project with post-implementation review, having a thorough involvement of each step in the process. Each project should be assessed for the appropriate level of control needed: too much control is too time consuming, too little control is too costly. If control is not implemented correctly, the cost to the business should be clarified in terms of errors, fixes, and additional audit fees.

Control systems are needed for cost, risk, quality, communication, time, change, procurement, and human resources. In addition, auditors should consider how important the projects are to the financial statements, how reliant the stakeholders are on controls, and how many controls exist. Auditors should review the development process and procedures for how they are implemented. The process of development and the quality of the final product may also be assessed if needed or requested. A business may want the auditing firm to be involved throughout the process to catch problems earlier on so that they can be fixed more easily. An auditor can serve as a controls consultant as part of the development team or as an independent auditor as part of an audit.

Businesses sometimes use formal systems development processes. These help assure that systems are developed successfully. A formal process is more effective in creating strong controls, and auditors should review this process to confirm that it is well designed and is followed in practice. A good formal systems development plan outlines:

Project Development Stages

Regardless of the methodology used, the project development process will have the same major stages: initiation, development, production or execution, and closing/maintenance.

Initiation

The initiation stage determines the nature and scope of the development. If this stage is not performed well, it is unlikely that the project will be successful in meeting the business’s needs. The key project controls needed here are an understanding of the business environment and making sure that all necessary controls are incorporated into the project. Any deficiencies should be reported and a recommendation should be made to fix them.

The initiation stage should include a cohesive plan that encompasses the following areas:

Planning and Design

After the initiation stage, the system is designed. Occasionally, a small prototype of the final product is built and tested. Testing is generally performed by a combination of testers and end users, and can occur after the prototype is built or concurrently. Controls should be in place that ensure that the final product will meet the specifications of the project charter. The results of the design stage should include a product design that:

Closing and Maintenance

Closing includes the formal acceptance of the project and the ending thereof. Administrative activities include the archiving of the files and documenting lessons learned.

Maintenance is an ongoing process, and it includes:

In this stage, auditors should pay attention to how effectively and quickly user problems are resolved.

Over the course of any construction project, the work scope changes. Change is a normal and expected part of the construction process. Changes can be the result of necessary design modifications, differing site conditions, material availability, contractor-requested changes, value engineering and impacts from third parties, to name a few. Beyond executing the change in the field, the change normally needs to be documented to show what was actually constructed. Hence, the owner usually requires a final record to show all changes or, more specifically, any change that modifies the tangible portions of the finished work. The record is made on the contract documents – usually, but not necessarily limited to, the design drawings. The end product of this effort is what the industry terms as-built drawings, or more simply, “asbuilts.” The requirement for providing them is a norm in construction contracts.

Project Management Tools

Project Management Tools include

Project Management Associations

Several national and professional associations exist which have as their aim the promotion and development of project management and the project management profession. The most prominent associations include:

International Standards

There have been several attempts to develop project management standards, such as:

Professional Certifications

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