PROJECT MANAGEMENT made easy Additional Titles in Entrepreneur’s Made Easy Series ̈ Accounting and Finance for Small Business Made Easy: Secrets You Wish Your CPA Had Told You by Robert Low ̈ Business Plans Made Easy: It’s Not as Hard as You Think by Mark Henricks ̈ Meetings Made Easy: The Ultimate Fix-It Guide by Frances Micale ̈ Strategic Planning Made Easy by Fred L. Fry, Charles R. Stoner, and Laurence G. Weinzimmer ̈ Advertising Without an Agency Made Easy by Kathy J. Kobliski ̈ Managing a Small Business Made Easy by Martin E. Davis ̈ Mastering Business Growth and Change Made Easy by Jeffrey A. Hansen PROJECT MANAGEMENT made easy Entrepreneur Press and Sid Kemp Editorial Director: Jere Calmes Cover Design: Beth Hansen-Winter Editorial and Production Services: CWL Publishing Enterprises, Inc., Madison, Wisconsin, www.cwlpub.com This is a CWL Publishing Enterprises book developed for Entrepreneur Press by CWL Publishing Enterprises, Inc., Madison, Wisconsin. © 2006 by Entrepreneur Press All rights reserved. Reproduction of any part of this work beyond that permitted by Section 107 or 108 of the 1976 United States Copyright Act without the express permission of the copy- right owner is unlawful. Requests for permission or further information should be addressed to the Business Products Division, Entrepreneur Media, Inc. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional serv- ices. If legal advice or other expert assistance is required, the services of a compe- tent professional person should be sought. —From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations ISBN 1-932531-77-7 Library of Congress Cataloging-in-Publication Data Kemp, Sid. Project management for small business made easy / by Sid Kemp. p. cm. ISBN 1-932531-77-7 (alk. paper) 1. Project management. 2. Small business Management. I. Title. HD69.P75K4552 2006 658.4'04 dc22 2005030986 10 09 08 07 06 05 10 9 8 7 6 5 4 3 2 1 v For Kris, my wife, who has stood by me as I've started my own business, struggled, succeeded, and found joy. vi vii PPrreeffaaccee xxii 11 GGeett IItt DDoonnee RRiigghhtt!! 11 Small Business in a Changing World 1 What Is a Project? 3 What Is Management? 4 Conclusion: Project Management for Your Business 10 22 SSmmaallll BBuussiinneessss PPrroojjeeccttss 1122 Where Do Projects Fit into Your Business? 13 Eight Ways Projects Benefit Your Business 18 Who’s Who on a Project 21 The 14 Questions for Every Project 23 Conclusion: Pick a Project and Go! 24 33 PPrreeppaarree,, DDoo,, FFoollllooww TThhrroouugghh 2266 Businesses, Projects, and Systems 27 Stages and Gates 28 The Nine Areas of Project Management 31 Conclusion: Tying It All Together 34 44. . DDrreeaammss aanndd OOppppoorrttuunniittiieess 3366 Rules for Making Dreams Real 36 Defining Your Dream or Opportunity 37 From Dream to Deadline 41 Conclusion: Making Your Dreams Real 43 Contents Introduction viii Contents 55 PPrroobblleemmss aanndd SSoolluuttiioonnss 4444 What Is a Problem? 44 From Problem to Project 50 Conclusion: Making the Solution Work 51 66 WWhhaatt AArree WWee MMaakkiinngg?? 5533 The Steps of Defining Scope 54 Write a Basic Statement of What We Are Making 54 Choose a General Approach to How We Will Make It 56 Draw and Write a Detailed Description of What We Are Making 57 Write a Detailed Work Breakdown Structure (WBS) 58 Write a Detailed Action Plan 60 Conclusion: A Leader with a Plan 61 77 PPllaannnniinngg TTiimmee aanndd MMoonneeyy 6622 Allocating, Estimating, Scheduling, and Budgeting 62 Detailed Scheduling 66 Detailed Budgeting 67 Conclusion: Ready to Stay on Track 68 88 MMaakkiinngg IItt G Goooodd 6699 Simple Quality Basics 70 Defining Quality 71 Planning for Quality 73 Conclusion: Taking the High Road 74 99 MMaakkiinngg SSuurree tthhee JJoobb GGeettss DDoonnee 7766 Risk Identification: Listing the Risks 78 Risk Analysis 81 Risk Response Planning 81 Risk Monitoring and Control 82 Conclusion: If It Doesn’t Go Wrong, It Will Go Right 83 1100 TTeeaammwwoorrkk aanndd CCoommmmuunniiccaattiioonnss 8855 Getting the Right Team 86 Defining Jobs Clearly 89 Supporting Self-Management 91 Supporting Effective Team Communications 91 Conclusion: Team Success™ 93 Introduction ix Contents 1111 GGeettttiinngg WWhhaatt YYoouu NNeeeedd 9944 Purchasing for Projects 95 Getting Expertise 97 Getting Information 98 Getting Permission 99 Evaluating Vendors 100 Tracking and Saving Money in the Purchasing Process 103 Conclusion: Hassle-Free and Good to Go! 104 1122 PPuulllliinngg tthhee PPllaann TTooggeetthheerr 110055 Tying the Plan Together 105 What if the Plan Changes? 109 The Preparation Review Gate 111 Conclusion: Set Sail! 114 1133 KKeeeeppiinngg EEvveerryytthhiinngg oonn TTrraacckk 111166 The Status Meeting 116 The Feedback-and-Control Concept 118 Practical Course Correction 119 Conclusion: Steady as She Goes! 122 11 44 PPrreevveenntt SSccooppee CCrreeeepp 112244 Sources of Scope Creep 124 Managing Scope Creep 129 Conclusion: Don’t Move the Goals 131 1155 SSttaayy oonn TTiimmee aanndd oonn BBuuddggeett 113322 Time Management in the Doing Stage 132 Cost Management in the Doing Stage 137 Conclusion: The Iron Triangle Delivered 140 1166 QQuuaalliittyy:: EElliimmiinnaattee EErrrroorr 114411 Work Systems That Eliminate Error 142 Creating a Quality Team 145 Quality at the Business Level 147 Quality at the Project Level 148 Quality at the Technical Level 149 Conclusion: Quality All the Way Through 150 11 77 RRiisskk:: MMaannaaggee UUnncceerrttaaiinnttyy 115511 Watch for Risks 151 Monitor Risk Status 153 Contents Keep Looking Ahead 153 Manage Risks Quickly 154 Keep the Project Moving 156 Conclusion: Sailing Through Stormy Waters 158 1188 MMaannaaggiinngg EExxppeeccttaattiioonnss 115599 Discuss Expectations Openly 160 Documenting Expectations 160 Defining the Expectations Gap 161 Managing the Expectations Gap 162 Ensure Communication with All Customers 164 Conclusion: The Doing Is Done! 167 1199 FFoollllooww TThhrroouugghh 116688 The Challenges of Following Through 171 Technical Follow-Through 174 Project Management Follow-Through 177 Conclusion: Safely Ashore! 182 2200 DDeelliivveerr DDeelliigghhtt 118833 Business Follow-Through 184 Follow-up After the Project 187 All You Need to Know 189 Conclusion: Success and Delight 193 2211 SSttoorreeffrroonntt SSuucccceesss s:: KKnnooww WWhhaatt YYoouu WWaanntt,, PPllaann,, aanndd GGoo ffoorr IItt 119944 A Long Time Coming: Opening the First Store 195 Gaining, Training, and Retaining Staff 196 Improvements—Roasting and Going Nuts 199 Front Porch Two: A Dream Coming True 202 Tips for Those Starting a Business 204 Conclusion 205 2222 CCaassee SSttuuddyy:: PPllaannnniinngg aa YYeeaarr ooff PPrroojjeeccttss 220077 A Strategic Plan Adds Flexibility 207 What Is a Strategic Plan? 208 How to Plan Strategy Each Year 209 Conclusion 212 AAppppeen nddiixx:: FFoorrmmss aanndd TToooollss 221133 IInnddeexx 224422 x [...]... it ̈ Install the product Some items require physical assembly or installation Either we do this or we make sure that the customer does and that he or she has it working right ̈ Test end to end to make sure everything is working right ̈ Provide training or instructions, including training for new people who might come later, after the customer is using the product We must make sure that this training... such as launching the business or opening a new store Others might be fulltime work for a few weeks: creating the fall catalog and mailing it out or 3 Project Management for Small Business Made Easy roject management helps by bringing problems under control P building a new web site Some projects take just a few hours: finding a new supplier to replace the one that is unreliable or hiring staff for... taking action to keep things under control project in three steps: prepare, do, follow through A Follow Through ̈ Delivery: Finishing the project, delivering the results, and making sure everyone knows it’s done ̈ Maintenance: Keeping up the good results through production management—monitoring, control, and improvement Whether we’re bringing a situation under control, solving a problem, or making... opened four businesses in six years, realizing their own dreams, delighting customers, and providing excellent opportunities for their employees by seizing opportunities and solving problems one after another And in Chapter 22, you’ll learn how to plan the projects for your own business, lining up a year of problem solving and business growth If you know how nails work, you can try pounding them with... Management for Small Business Made Easy, focus on getting better in the areas that most need improvement The Lesson: In work, everything connects like a chain Honest assessment lets us find the weakest link, so we can make it stronger pany—projects are linked directly to customer satisfaction and profit Internal Projects: Working Smarter Type 2 companies, on the other hand, make money by selling many of the... better marketing ̈ Reaches new markets or customers, for example, by opening a new location or starting to sell through a web site ̈ Markets or delivers to our customers in new ways, increasing sales or lowering the cost of sales ̈ Speeds up cycle time, getting products to market faster, completing 19 Project Management for Small Business Made Easy jobs faster, getting supplies faster, and making decisions... our price, by selling more of what we already sell, or by selling new products without increasing our cost per sale, that increases net revenue Reduce risks There are risks—things that might happen—associated Small Business Projects with any business For instance, as a business, we have personal information about our employees and credit card information about our customers If this information is stolen... have a different role in Type 2 companies Instead of making money directly, projects in Type 2 companies help the company solve problems and work smarter, so they can stay in business and make more money Type 2 companies do projects for four reasons: n internal project is an investment that pays off by making the business better A 15 Project Management for Small Business Made Easy ̈ To realize new... these in a bit more detail Prepare ̈ ̈ Evaluation: Is it worth fixing? How big is the problem? ̈ Planning: What do we want to do about it? ̈ 4 Investigation: What’s really going on? Getting ready: Get the people and things you need Get It Done Right! Do ̈ Action: Doing the work and fixing the problem ̈ Tracking: Making sure our work follows the plan and fixes the problem ̈ Control: If tracking shows... $1,000 And I bet you’re in the same boat So, project management is about success for your business In this chapter, you’ll learn: ̈ ̈ the eight ways projects benefit a business ̈ who’s who on a project ̈ 12 where external and internal projects fit into your business and the 14 questions to ask on every project Small Business Projects Where Do Projects Fit into Your Business? In Chapter 1, Get It Done . PROJECT MANAGEMENT made easy Additional Titles in Entrepreneur’s Made Easy Series ̈ Accounting and Finance for Small Business Made Easy: Secrets You Wish. Coming: Opening the First Store 195 Gaining, Training, and Retaining Staff 196 Improvements—Roasting and Going Nuts 199 Front Porch Two: A Dream Coming