Business, Legal & Accounting Glossary
Project management is the ensemble of activities concerned with successfully achieving a set of goals. This includes planning, scheduling and maintaining progress of the activities that comprise the project. Reduced to its simplest Project Management is the discipline of maintaining the risk of failure at as low a value as necessary over the lifetime of the project. Risk of failure arises primarily from the presence of uncertainty at all stages of a project.
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 the overall risk of failure is reduced.
A project could literally be as simple as making breakfast, but in the context of the practice of project management, a project is best defined as an undertaking with a discrete start, a discrete finish, and some complexity. Compare this to, say, a manufacturing line, which is intended to be a continuous process without a planned end.
Typical projects might include the engineering and construction of a building, or the design, coding, testing and documentation of a computer software program, or development of the science and clinical testing of a new drug. The duration of a project is the time from its start to its completion, which can take days, weeks, months or even years.
Generally, there are two approaches that can be taken to project management today. The “traditional” approach identifies a sequence of steps to be completed. This contrasts with the Agile Methods approach in which the project is seen as relatively small tasks rather than a complete process. The objective of this approach is to impose as little overhead as possible in the form of rationale, justification, documentation, reporting, meetings, and permission.
In the traditional approach, we can distinguish 5 stages in the development of a project:
Not all 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.
Three of these variables can be given by external or internal customers. The value(s) of the remaining variable(s) is/are then set by project management, ideally based on solid estimation techniques. The final values have to be agreed upon in a negotiation process between project management and the customer. Usually, the values in terms of time, cost, quality and scope are contracted.
To keep control over the project from the beginning of the project all the way to its natural conclusion, a project manager uses a number of techniques: project planning, earned value, risk management, scheduling, process improvement.
Project management was not used as an isolated concept before the Sputnik crisis of the Cold War. After this crisis, the United States Department of Defense needed to speed up the military project process and new tools (models) for achieving this goal were invented. In 1958 they invented the Program Evaluation and Review Technique or PERT, as part of the Polaris missile submarine program. At the same time, the DuPont corporation invented a similar model called CPM, critical path method. PERT was later extended with a work breakdown structure or WBS. The process flow and structure of the military undertakings quickly spread into many private enterprises.
There are a number of guiding techniques that have been developed over the years that can be used to formally specify exactly how the project will be managed. These include the Project Management Body of Knowledge (PMBOK), and such ideas as the Personal Software Process (PSP), and the Team Software Process (TSP) and PRINCE2. These techniques attempt to standardize the practices of the development team making them easier to predict and manage as well as track.
Critical chain is the latest 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 a very large-scale, one-time, non-routine project, and nowadays all kinds of management is 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, for example, Extreme Programming for software development and Scrum techniques. The generalization of extreme programming to other kinds of projects is extreme project 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 integrated) and ISO/IEC15504 (SPICE – Software Process Improvement Capability dEtermination). Both of these models have been successfully adopted by organisations all over the world in an effort to have better control over the project. With a view to improving the accuracy of estimation, reducing costs and preventing defects. CMMi is widely used in the defence industry and their subcontractors in the USA and Australia, and SPICE is growing in use in the private sector in Europe.
The main thrust of Process Management is the concept of knowledge management. It is the experience of companies that use these models that the creation of a set of defined processes detailing what the company actually does has enabled them to achieve consistency across project teams and project. They have also found that, when it is defined, their ability to track and monitor performance with a view to improvement is far more successful.
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This glossary post was last updated: 20th February, 2020