i Trevor L Young The Handbook of PR OJECT MANAGEMENT A practical guide to effective policies, techniques and processes London and Philadelphia Revised 2nd edition ii First published 1996 First paperback edition 1998 Second edition published in Great Britain and the United States in 2003 by Kogan Page Limited Reprinted 2004, 2005 (twice), 2006 Revised second edition 2007 Apart from any fair dealing for the purposes of research or private study, or criti- cism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form or by any means, with the prior permission in writing of the publishers, or in the case of reprographic reproduction in accordance with the terms and licences issued by the CLA. Enquiries concerning reproduction outside these terms should be sent to the publishers at the undermentioned addresses: 120 Pentonville Road 525 South 4th Street, #241 London N1 9JN Philadelphia PA 19147 United Kingdom USA www.kogan-page.co.uk © Trevor L Young, 1996, 2003, 2007 The right of Trevor L Young to be identified as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988. ISBN-10 0 7494 4984 5 ISBN-13 978 0 7494 4984 1 British Library Cataloguing in Publication Data A CIP record for this book is available from the British Library. Library of Congress Cataloging-in-Publication Data Young, Trevor L. (Trevor Leonard), 1940- The handbook of project management : a practical guide to effective policies, techniques and processes / Trevor L Young. Rev. 2nd ed. p. cm. Includes index. ISBN-13: 978-0-7494-4984-1 ISBN-10: 0-7494-4984-5 1. Project management Handbooks, manuals, etc. I. Title. HD69.P75Y68 2007 658.4Ј04 dc22 2007017489 Typeset by Saxon Graphics Ltd, Derby Printed and bound in Great Britain by Creative Print and Design (Wales), Ebbw Vale Contents Preface to the revised second edition vii Part 1 The programme and project environment 1 1 Introduction 3 What is special about programmes and projects? 4 Who is this book for? 5 2 Change: programmes and projects 7 Change and the programme and project manager 8 What is a project? 9 Projects and sub-projects 10 What is a programme? 12 An example programme 14 Why programme management? 14 What is programme management? 16 What is project management? 17 Why is programme management different from project management? 18 What is different about programme and project management? 19 How are programmes and projects derived? 21 The dynamic life cycle 23 The dynamic action cycle 24 The programme and project process phase gates 26 Is the phase gate a constraint? 28 Is this control necessary? 29 Summary 30 iii 3 Organizing for programme management 31 Organizing for ownership 33 Establishing the programme steering team 34 Continuous improvement and problem solving: are they projects? 36 The programme register 37 Operating a programme register 37 The key responsibilities of the programme steering team 41 Meetings of the programme steering team 42 Managing the portfolio: selection of programmes and projects 44 The inputs to effective selection 46 The secondary screening 48 The result of effective selection 49 Summary 51 4 The key roles 53 The project steering team administrator 54 The sponsor 55 The programme manager 55 The project manager 56 The functional manager 56 The stakeholders 57 Frequently used terms 59 The programme and project manager as a leader 60 The dimensions of leadership in the programme and project environment 62 Dimension 1: Managing stakeholders 63 Dimension 2: Managing the dynamic life cycle 66 Dimension 3: Managing performance 66 Programmes, projects and teamwork 67 Building your team 70 Customer satisfaction 71 Summary 72 Part 2 The programme and project processes and techniques 75 5 Starting up: ideas and opportunities for projects 77 The fundamental data needs 78 What are the constraints? 79 What data does the programme steering team require? 80 Preparing the initial business case 80 Through Gate Zero to Gate One 81 Presenting the business case to the programme steering team 87 The kick-off meeting 88 Project documentation 91 The project brief and specification 95 Summary 97 iv l Contents 6 Defining the project 99 What is necessary to define a project? 99 The stakeholder list 100 The project brief 101 The scope of work statement 105 Risk management 107 Risk assessment 110 Quantifying identified risks 114 Risk monitoring 120 Getting your project definition approved 120 Summary 123 7 Planning your project 126 What is not going to be done? 126 Who needs to be involved? 127 Where does planning start? 127 Identifying the key stages 128 The project work breakdown structure 131 Allocating responsibility 132 What is an estimate? 134 Avoid some classic pitfalls 135 The golden rules 137 Effort and duration 137 Estimating the durations 139 Contingencies 142 Time-limited scheduling and estimates 143 Identifying the critical path of your project 145 The programme evaluation and review technique 146 Analysing the logic diagram 149 Using the PERT analysis data 149 Analysing your resource requirements 154 Optimizing your schedule 155 Reviewing your project risk log 159 Reviewing your project budget 160 Intermediate phase gates 161 Seeking approval to launch your project 162 Summary 164 8 Launching your project 166 Establishing key stage work plans 166 Deriving a milestone schedule 169 Critical success factors 171 Ensuring effective communication 173 Project status reports 174 Deriving a meetings schedule for your project 177 Managing project changes 178 Contents l v Holding a launch meeting 185 Summary 188 9 Executing the project work 190 The project control system 191 Monitoring progress 195 Managing issues 198 Reviewing project issues 206 Tracking your project 207 Taking corrective action 212 Problem solving 214 Progress meetings 217 Progress reporting 220 Encouraging good time management 222 Controlling the project costs 228 Balancing the project 234 Approaching the closure phase 238 Summary 239 10 Closing your project 242 Why have a closure phase? 243 Establishing completion criteria 244 The acceptance process 246 The close-out meeting 247 Evaluating your project 251 Closing down the project 252 Post-project evaluation 254 Post-project appraisals 258 What next? 259 Summary 261 11 Using a computer 263 What can software do? 264 Using a software program 267 What software does not do 270 Selecting project software 271 The programme management office 271 12 Common project problems 274 Problem analysis 274 How projects succeed 280 Postscript 282 Appendix 1: Glossary of terms 283 Appendix 2: Further reading 289 Index 291 vi l Contents Preface to the revised second edition Welcome to this revised second edition. Several significant changes were made in the second edition. In this revision most chapters have had some modifications and additions. In particular, in Chapter 7 there are addi- tional techniques on estimating and in Chapter 9 the techniques of project balancing have been revised. A new Chapter 12 on the common problems of project management has been added. The main structure of the work, divided into two parts, remains unchanged. Part 1 looks at the programme and project environment. This includes how programmes have evolved and relate to projects and introduces the process for managing an idea or opportunity as it progresses from initial selection on through the different phases of a programme or project. The concept of phase gates to allow senior management control over the programme and project activities is included. These techniques depend very much on organizing for programme and project management, ensur- ing that the strategically appropriate programmes and projects are selected to create a portfolio of active projects and programmes. Finally in Part 1, the roles and their responsibilities are discussed to enable effective management of the portfolio. Part 2 has been extensively revised to ensure that the processes and techniques described fit the programme and project environment. The detailed processes for managing an opportunity through each phase gate to completion have been enhanced with new material. The risk manage- ment process has been modified to include quantitative risk assessment. The issue management process and the change management process have been extensively revised on the basis of practical experience. Additional vii cost control and earned value analysis techniques have been added. Finally, the project closure process has been enhanced. This book is based on over 30 years’ experience in the project environ- ment, and in that time I have learnt much from others – and much the hard way of ‘try it and see if it works’. I could not begin to list all those who have helped me on that journey, working together at different times to achieve a successful project outcome. Programme management has not been easily understood in many companies. I would like to acknowledge the huge amount of commitment and support from Ken Foster and thank him for the many hundreds of satisfying hours we have spent together persuading others of the value of the techniques in this book. I thank Ken also for his many suggestions and helpful comments on the material in Part 1. Finally, I thank Christine, my wife, for tolerance, patience and the support she gave to help me complete this project on time. viii l Preface to the revised second edition Part 1 The programme and project environment Part 1 is focused on understanding the steps that an organization needs to take to create an effective environment for success in programme and project management. This includes understanding the terminology and the organiza- tional structure changes advisable to take advantage of a programme-oriented environment in the business. Part 1 also looks at the steps necessary to institute a formalized approach to programme and project selection and at understanding the essential roles and their responsibilities that are required for these processes to be effective. 1 2 This page is left intentionally blank [...]... management are practical and relatively simple to understand This does not mean they are always easy to apply, because of the complexity of the work and the effects of scale The emphasis is on business programmes and projects, which are often small and of short duration when compared to highly technical or construction projects The book is written as a pocket guide, so it is not a book to read once and place... objectives and left them to appoint a project manager who will make decisions concerning the required sub-projects Second, the programme manager has given the departmental managers of the Far East plant separate cost reduction targets and left each of them to appoint their project manager, who will decide if any sub-projects are necessary In this way the total activity is broken down into manageable chunks... impacting the overall outcome Additional sub-projects can be initiated to take advantage of improved performance or revised scope and delivery as the programme proceeds WHY PROGRAMME MANAGEMENT? Programme management provides the organization with an opportunity to break down the work into a group of related and interdependent projects The ‘programme approach’ allows you to separate easily manageable... on them: ineffective management, unclear objectives and inadequate resources Many organizations have fallen into the trap of making their projects too big, often by default as the objectives are widened or because ‘add-ons’ to the original scope lead to ‘scope creep’ Management issues are increased and such projects often acquire a legendary status in the organization Dividing such large projects into... knowledge, add some new tools and techniques to your personal skill set and improve your performance; you have an involvement in programmes and projects and need to coach others in the application of the appropriate tools and techniques in a proven process This is not an academic textbook offering you complex theories to learn The tools and techniques of effective and successful programme and project management... open sabotage These consequences must be effectively managed for a successful outcome CHANGE AND THE PROGRAMME AND PROJECT MANAGER Programmes and projects are concerned with creating and managing change in an organized and structured manner Proven tools and techniques are available to you but you must also focus on the impact on people A successful outcome is a direct measure of your ability as an effective. .. give managers in the organization a better understanding of programme and project management and how to establish an effective environment to achieve results; to give you, the programme or project manager, a guide to help you improve performance using well tried and tested tools and techniques The skills of project management are not the only tools you will need to become more effective, yet many of these... During the past decade the skills of project management have become increasingly recognized as highly desirable for managers at all levels in an organization Most people today can benefit from the application of these skills to some parts of their daily operations The rapid growth of global markets and the introduction of Total Quality Management, continuous improvements and, more recently, the drive to. .. stages, tasks and sub-tasks Not directly related to another active project Directly related to an active project May be directly part of an active programme and related to one or more other projects Not directly part of an active programme except as part of an active related project Change: programmes and projects l 13 far exceeding initial expectations Such projects soon show the signs of the strain imposed... whom may have little interest in the results expected; coach, guide and actively support the individual team members; explain decisions and keep everyone informed of progress; establish a sustaining environment for effective dialogue and feedback in the team and with other teams and their management; manage upwards to influence senior management and other line managers; manage third parties: contractors, . 9 Projects and sub-projects 10 What is a programme? 12 An example programme 14 Why programme management? 14 What is programme management? 16 What is project management? 17 Why is programme management. and project management, ensur- ing that the strategically appropriate programmes and projects are selected to create a portfolio of active projects and programmes. Finally in Part 1, the roles and. managers at all levels in an organization. Most people today can benefit from the application of these skills to some parts of their daily operations. The rapid growth of global markets and the