Key Project Management Concepts & Definitions

Posted on Apr 3, 2025 in Business Administration and Management (BAM)

CPM and PERT Definitions

  • CPM: Critical Path Method
  • PERT: Program Evaluation and Review Technique

Decision-Making Process Steps

  1. Identify the Problem: Understand the issue requiring a decision.
  2. Gather Information: Collect relevant data and facts.
  3. Identify Alternatives: List possible solutions or actions.
  4. Weigh Evidence: Evaluate the pros and cons of each alternative.
  5. Choose an Option: Select the best course of action.
  6. Implement the Decision: Put the chosen solution into action.
  7. Evaluate the Outcome: Review the results and make adjustments if necessary.

Internal vs. External Project Risk

  • Internal Risk: Arises from factors within the project or organization, such as team performance, budget constraints, or technology failures.
  • External Risk: Originates from outside factors beyond the organization’s control, like market fluctuations, regulatory changes, or natural disasters.

Understanding Market Risk

Building an excellent product or system that no one really wants is called Market Risk or Product-Market Fit Risk. This occurs when a product fails to align with market needs, leading to failure despite potentially high quality.

What Is a Stakeholder?

A stakeholder is any individual, group, or organization that can affect or be affected by a project. Examples include customers, employees, investors, and suppliers.

What Is a Project Charter?

A Project Charter is a formal document that authorizes a project’s initiation. It outlines the project’s objectives, scope, stakeholders, key milestones, and assigned resources. It serves as a reference throughout the project lifecycle.

Project Management Life Cycle Phases

The Project Management Life Cycle consists of phases that guide a project from initiation to completion. The main stages are:

  1. Initiation

    • Define the project, its purpose, and feasibility.
    • Key Deliverables: Project Charter, Feasibility Study.

  2. Planning

    • Outline the project’s scope, resources, schedule, and budget.
    • Key Deliverables: Work Breakdown Structure (WBS), Gantt Chart, Risk Management Plan.

  3. Execution

    • Implement the project plan and manage resources.
    • Key Activities: Team coordination, task allocation, and progress tracking.

  4. Monitoring and Controlling

    • Track performance and make adjustments as needed.
    • Key Tools: KPIs, Quality Control, Risk Management.

  5. Closure

    • Finalize all activities and hand over deliverables.
    • Key Deliverables: Project Report, Lessons Learned, Client Sign-off.

Diagram:

+--------------+     +--------------+     +--------------+     +--------------+     +--------------+
|  Initiation  | --> |   Planning   | --> |  Execution   | --> | Monitoring   | --> |   Closure    |
+--------------+     +--------------+     +--------------+     +--------------+     +--------------+

Work Breakdown Structure (WBS) Explained

A WBS (Work Breakdown Structure) is a hierarchical decomposition of the total project into smaller, manageable tasks or deliverables.

Why WBS is Needed:

  • Breaks down complex projects into simpler tasks.
  • Helps in resource allocation and tracking progress.
  • Ensures no task is overlooked.

Example: Building a House

  • Foundation
    • Site Preparation
    • Concrete Pouring
  • Structure
    • Walls
    • Roofing
  • Finishing
    • Plumbing
    • Painting

This makes project management organized and efficient.

Project Management Fundamentals & Principles

Project Management is the process of planning, organizing, and overseeing project tasks to achieve specific goals within time and budget constraints.

Principles of Project Management:

  1. Clear Objectives: Define project goals and outcomes.
  2. Scope Management: Control what is included and excluded from the project.
  3. Resource Allocation: Optimize the use of time, budget, and people.
  4. Risk Management: Identify and mitigate potential risks.
  5. Continuous Communication: Ensure clear communication among stakeholders.
  6. Monitoring and Evaluation: Track progress and make necessary adjustments.
  7. Customer Satisfaction: Deliver value to the client.

Total Quality Management (TQM) Overview

TQM (Total Quality Management) is a management approach focused on improving processes, products, and customer satisfaction through continuous improvement and teamwork.

Principles of TQM:

  1. Customer Focus: Understand and meet customer needs.
  2. Continuous Improvement: Regularly enhance processes.
  3. Employee Involvement: Encourage team participation and ownership.
  4. Process Approach: Optimize processes to improve efficiency.
  5. Data-Driven Decision Making: Base decisions on data and analysis.
  6. Integrated System: Align all departments toward quality goals.
  7. Mutual Respect: Foster trust and respect among all stakeholders.

Understanding Organization Structures

An Organization Structure defines how activities such as task allocation, coordination, and supervision are directed toward achieving organizational goals. It lays out the hierarchy and communication flow within an organization.

Types of Organization Structures:

  • Functional Structure: Divides the organization into departments based on functions (e.g., Marketing, Sales, IT).
  • Divisional Structure: Organizes departments based on products, services, or geographic regions.
  • Matrix Structure: Combines functional and project-based structures, where employees report to both a functional manager and a project manager.
  • Flat Structure: Reduces hierarchical levels to encourage open communication and quick decision-making.
  • Hierarchical (Line) Structure: Follows a traditional top-down chain of command.

Functional Organization Structure:

In a Functional Structure, the organization is divided into departments based on specialized functions. Each department has its own head, and employees report to functional managers.

Example: In a software company:

  • HR Department: Handles recruitment and employee relations.
  • Development Department: Manages coding and testing.
  • Marketing Department: Focuses on promotions and sales.

Advantages:

  • Specialization improves efficiency.
  • Clear lines of authority.

Disadvantages:

  • Can create silos, limiting cross-department collaboration.

Software Project Risk Management

In software projects, risk is the possibility of an event that can negatively affect the project’s outcome, such as delays, cost overruns, or system failures.

Proactive vs. Reactive Risk Management:

  • Proactive Risk Management: Identifies potential risks early and plans strategies to prevent them. Example: Conducting code reviews to prevent bugs.
  • Reactive Risk Management: Responds to risks after they occur, focusing on damage control. Example: Fixing a security breach after it happens.

Types of Software Project Risks:

  • Technical Risks: Related to technology, like compatibility issues.
  • Schedule Risks: Project delays due to unforeseen events.
  • Budget Risks: Cost overruns from poor estimation.
  • Operational Risks: Failures in process execution or human errors.
  • Market Risks: Changes in market demand or competition.
  • Security Risks: Data breaches or cyberattacks.

Project Feasibility Study Types

A Feasibility Study assesses the practicality of a project before it begins. It evaluates various factors to determine if the project is viable.

Types of Feasibility Studies:

  • Technical Feasibility: Checks if the technology required is available and capable of supporting the project. Example: Assessing if current servers can handle a new e-commerce platform.
  • Economic Feasibility: Evaluates the cost-effectiveness of the project and its potential return on investment (ROI). Example: Calculating the total project cost vs. expected revenue from a mobile app launch.
  • Legal Feasibility: Ensures the project complies with laws and regulations. Example: Checking GDPR compliance for a data-driven project in Europe.
  • Operational Feasibility: Determines if the organization has the personnel, time, and processes to implement the project. Example: Verifying if staff can manage a new customer support system.
  • Schedule Feasibility: Assesses whether the project timeline is realistic. Example: Estimating if a website redesign can be completed before a product launch.