Chapter 4: Project Integration Management

It is often difficult to provide strong justification for many IT projects, but everyone agrees they have a high value

"It is better to measure gold roughly than to count pennies precisely"

What the Winners Do

"The winners clearly spell out what needs to be done in a project, by whom, when, and how. For this they use an integrated toolbox, including PM tools, methods, and techniques...If a scheduling template is developed and used over and over, it becomes a repeatable action that leads to higher productivity and lower uncertainty. Sure, using scheduling templates is neither a breakthrough nor a feat. But laggards exhibited almost no use of the templates. Rather, in constructing schedules their project managers started with a clean sheet, a clear waste of time."*

1. Developing the project charter involves working with stakeholders to create the document that formally authorizes a project—the charter.

2. Developing the project management plan involves coordinating all planning efforts to create a consistent, coherent document—the project management plan.

Another categorization is how long it will take to do and when it is needed

Another is the overall priority of the project

A 2013 survey identified companies most admired for their ability to apply IT-related business capabilities for competitive advantage

Best practices of these companies include: Customer-driven IT is essential. IT can enable branding and customer recruitment. Keep improving.

Solution:

Changes are often beneficial, and the project team should plan for them

Performing integrated change control involves identifying, evaluating, and managing changes throughout the project life cycle.

Closing the project or phase involves finalizing all activities to formally close the project or phase.

"48-hour policy" allows project team members to make decisions, then they have 48 hours to reverse the decision pending senior management approval

Delegate changes to the lowest level possible, but keep everyone informed of changes

Explain the importance of creating a project charter to formally initiate projects

Describe project management plan development, understand the content of these plans, and review approaches for creating them

Explain project execution, its relationship to project planning, the factors related to successful results, and tools and techniques to assist in directing and managing project work

Describe the process of monitoring and controlling a project

Introduction or overview of the project

Description of how the project is organized

Determine estimated costs and benefits for the life of the project and the products it produces

Determine the discount rate (check with your organization on what to use)

Main processes include

Develop the project charter. Develop the project management plan. Direct and manage project execution. Monitor and control project work. Perform integrated change control. Close the project or phase.

Describe an overall framework for project integration management as it relates to the other project management knowledge areas and the project life cycle

Discuss the strategic planning process and apply different project selection methods

A project statement of work. A business case. Agreements.

Enterprise environmental factors. Organizational process assets, which include formal and informal plans, policies, procedures, guidelines, information systems, financial systems, management systems, lessons learned, and historical information

Understand the integrated change control process, planning for and managing changes on information technology (IT) projects, and developing and using a change control system

Explain the importance of developing and following good procedures for closing projects

Main outputs include

Final product, service, or result transition. Organizational process asset updates.

The 2002 Olympic Winter Games and Paralympics took five years to plan and cost more than $1.9 billion. PMI awarded the Salt Lake Organizing Committee (SLOC) the Project of the Year award for delivering world-class games.

Four years before the Games began, the SLOC used a Primavera software-based system with a cascading color-coded WBS to integrate planning...The SLOC also used an Executive Roadmap, a one-page list of the top 100 Games-wide activities, to keep executives apprised of progress. Activities were tied to detailed project information within each department's schedule. A 90-day highlighter showed which managers were accountable for each integrated activity.

A weighted scoring model is a tool that provides a systematic process for selecting projects based on many criteria

Identify criteria important to the project selection process Assign weights - percentages - to each criterion so they add up to 100%. Assign scores to each criterion for each project. Multiply the scores by the weights and get the total weighted scores.

Three main objectives are:

Influencing the factors that create changes to ensure that changes are beneficial

The higher the ROI, the better. Many organizations have a required rate of return or minimum acceptable rate of return on investment for projects

Internal rate of return (IRR) can by calculated by finding the discount rate that makes the NPV equal to zero

Determining that a change has occurred

Managing actual changes as they occur

Project managers must coordinate all of the other knowledge areas throughout a project's life cycle

Many new project managers have trouble looking at the "big picture" and want to focus on too many details (See opening case for a real example)

Payback occurs when the net cumulative discounted benefits equals the costs

Many organizations want IT projects to have a fairly short payback period

There are usually more projects than available time and resources to implement them

Methods for selecting projects include:

3. Directing and managing project work involves carrying out the project management plan by performing the activities included in it.

Monitoring and controlling project work involves overseeing activities to meet the performance objectives of the project

Calculate the NPV (see text for details)

Notes: Some organizations consider the investment year as year 0, while others start in year 1. Some people entered costs as negative numbers, while others do not. Check with your organization for their preferences

An audit report said the project was beyond their in-house capabilities and experience

Organizations must make the right staffing/outsourcing decisions

Strategic planning involves determining long-term objectives, predicting future trends, and projecting the need for new products and services

Organizations often perform a SWOT analysis analyzing Strengths, Weaknesses, Opportunities, and Threats

A project management plan is a document used to coordinate all project planning documents and help guide a project's execution and control

Plans created in the other knowledge areas are subsidiary parts of the overall project management plan

Net present value (NPV) analysis is a method of calculating the expected net monetary gain or loss from a project by discounting all expected future cash inflows and outflows to the present point in time

Projects with a positive NPV should be considered if financial value is a key criterion. The higher the NPV, the better

Return on investment (ROI) is calculated by subtracting the project costs from the benefits and then dividing by the costs

ROI = total discounted benefits minus total discounted costs divided by discounted costs

Another important financial consideration is payback analysis

The payback period is the amount of time it will take to recoup, in the form of net cash inflows, the total dollars invested in a project

The Surrey police force began looking into replacing its criminal intelligence system in 2005, but the project was finally cancelled in 2013, and the old system was replaced with a much less expensive one used by thirteen other forces

The person in charge of the project would not take responsibility for it

Project management information systems:

There are hundreds of project management software products available on the market today, and many organizations are moving toward powerful enterprise project management systems that are accessible via the Internet See the What Went Right? example of Kuala Lumpur's Integrated Transport Information System on p. 169

Three important criteria for projects:

There is a need for the project. There are funds available. There's a strong will to make the project succeed.

Financial considerations are often an important consideration in selecting projects

Three primary methods for determining the projected financial value of projects: Net present value - NPV analysis. Return on investment (ROI). Payback analysis.

Several types of software can be used to assist in project integration management

Tracking can be done with spreadsheets or databases Communication software can facilitate communications. Project management software can pull everything together and show detailed and summarized information

Use effective configuration management. Define procedures for making timely decision on smaller changes. Use written and oral perforamence reports to help identify and manage change.

Use project management and other software to help manage and communicate changes. Focus on leading the project team and meeting overall project goals and expectations.

Table 4-3. Suggestions for Performing Integrated Change Control

View project management as a process of constant communciation and negotiation. Plan for change. Establish a formal change control system, including a change control board - CCB.

Management and technical processes used on the project

Work to be done, schedule, and budget information

One categorization is whether the project addresses

a problem. an opportunity, or. a directive

Project managers may still need to

break the rules to meet project goals, and senior managers must support those actions

focusing on broad organizational needs

categorizing information technology projects performing net present value or other financial analyses

Configuration management specialists identify and document configuration requirements, control changes, record and report changes, and audit the products to verify conformance to requirements

configuration requirements, control changes, record and report changes, and audit the products to verify conformance to requirements

Project integration management involves

coordinating all of the other knowledge areas throughout a project's life cycle

Drs. Robert Kaplan and David Norton

developed this approach to help select and manage projects that align with business strategy

To close a project or phase, you must

finalize all activities and transfer the completed or cancelled work to the appropriate people

Includes stakeholders

from the entire organization

By the end of 2013, wireless broadband penetration

grew to 72.4% in the OECD area

As part of strategic planning, organizations

identify potential projects. use realistic methods to select which projects to work on. formalize project initiation by issuing a project charter.

using a weighted scoring model

implementing a balanced scorecard

A balanced scorecard

is a methodology that converts an organization's value drivers, such as customer service, innovation, operational efficiency, and financial performance, to a series of defined metrics See www.balancedscorecard.org for more information

Organizations must

make major cultural changes to improve

Organizational culture can help project execution by

providing guidelines and templates. tracking performance based on plans.

Project managers must

solicit input from the team to develop realistic plans

A baseline is

the approved project management plan plus approved changes

The higher the weighted score,

the better

Describes

who is authorized to make changes and how to make them