Unknow-unknown: who could imagine, who knew?, unpredictable disaster - management reserve Known unknown – risk response, residual risk, secondary risk, accept (contigency reserve) PM SW will not solve and simplify everything. But it helps. Initialization BENEFIT MEASURMENT MODELS: Economic models Comparative models CONSTRAINED OPTIMIZATION, MATHEMATICAL MODELS Linear programming Decision trees Mltiobjective programming Lifecycle cost: project costs + operational + maintainance PMIS Configuration system Change Control System Planning Tools for project plan development: Project planning methodology, EV management, stakeholders skills and knowledge Project success: o completion of the project on time and within budget o satisfaction of of the specification (contract, SOW) o Acceptance by the customer Project plan: budgeting, timing, tresholds, methodology Project INTERFACE planning – plan communication with several subcontractors The CORE (planning) processes have clear dependencies so they must be executed in essentially the same order on most projects Project scope: work Product scope: features Performance reports Scope control Project scope statement detailed scope statement assumptions, constraints (cost, milestones) acceptance criteria Work Breakdown Structure (WBS) - Each item of the WBS is assigned an unique identifier o This is called Code of account - Smallest item in a WBS is the work package – that cannot be broken down further/can be assigned, estimated, budgeted - Control account is above the Planning package in a WBS - WBS=total scope of a project - Serves as a team development tool (teambuilding), stakeholder communication enchaer - Scope baseline: WBS, WBS dict, scope stat. - Cannot illustrate dependencies Time mnmgnt: Activity: definition, sequencing, resource estimation, duration estimation, scedule development, scedule control Dependencies: - Mandatory (hard logic) - Discretionary (soft logic) - External (goverment) Sequencing: GERT, CDM : conditional diagraming method: allows loops, conditional branches, multiple ends PDM=AON ADM=AOA – dummy Total Float (slack) – flexibility of the Project schedule Free slack – delay, without delaying the next activity Activity estimation: - Analogous: - Top down - Based on historical records (past information data) - Parametric – 3 point estimate; X krat cost of item, nubmer of lines… - 3 point estimate: O, M, P - Reserve analisys: add buffer = contingency, acitvity + continegcy - Padding (bigger activites): no good Schedule compression: do not change scope - Crashing (on cpm) - Fasttracking (on cpm) - Resource leveling: keep resource at constant level; allocation of scarce - CCM: buffer, flexible start time, leveling, scarce resources - CPM: early start, early finish, late start, late finish - What-if scenarios: calculate, 3 point est, monte carlo Cost estimate: Bottom up – later stages of planning Parametric estimating (statistical, matehmatical) Reserve analisys Workaround or management reserve for unknown risk QUALITY Voice of the customer: stated and implied requirements PM has overall responsibility Team for deliverables Stakeholders/client – set up test specifications, specification QA QC Process Product Deviation Defect Tolerance limits Control limits Specification (customer) limits Verification Validation Planned or random, continuous q- improvement Identify inefficient processes Q.planning: benchmarking, cost-benefit analisys, DoE COST of Conformance COST of Nonconformance Employee training and education, q- Rewoek, delays, poor jb performance, planning, design costs, q-engineering, q- scrap, customer satisfaction devrase, audits, inspection costs warranty costs HR: planning tools: - OBS – organiaztions: HR - RBS – resources: also non-human resources - RAM charts: who does what, RACI (responsible, accountable, consult, inform), PARIS - Text oriented descpritions of team members responsiblities Staffing mngmnt plan contains RESOURCE HISTOGRAM. Resource histograms – number of resources in time RISK: Pure risk is insurable Business risk: profit or loss Risks, responses, root causes of risks – in RISK REGISTER not risk manangement plan Risk management plan: timing, roles, methodology, budget; iterative process Tools r.mngmnt plan: risk planning meetings Risk identification: influence, wf, ishikawa Risk identification techniques: assumption analisys: true, false, certain Risk: gathering information: brainstormin, delphi, swoot, ishikawa, funnel analisys Risk fallback plan cannot include outsourcing to another vendor. DATA PRECISION RANKING – technique: is the DATA about risks useful for RISK management Measure risk probability and impact for every risk. Qualitative: quick, ranking low, high, no numbers, subjective, high tolerance Next Quanititative: 1, 2, 3.. , objecitve, expert level, tools: - Sensitivity analisys - Decision tree - EMV - Monte carlo Risk response planning for oportunities and risks Strategies for RISK: - Avoidance: change the PM plan: scope, time… - Transference: outsourcing component, insurance - Mitigation: reduce the probability and then accept OPORTUNITIES - Exploit: ensure it does occur - Share: 3rd party, alliance, joint venture - Enhance: increase probability BOTH: accept (contingecy reserve) Resiudal after risk response, secondary = new risk Plan PURCHASES and ACQUSITIONS: plan, make or buy, SOW Execution Select sellers: SHOULD COST: prepare an independent estimate to check the proposed price of different sellers Acquire project team – work with functional manager, complete HR staffing mngmnt plan Team performance asessment Stages of team development Create recognition and reward (consider cultural differences – which will always be an obstacle to overcome) Virtual teams – not on one location, leadership style: directing, coaching, supporting or delegating style PM powers: formal (positional): reward, penalty/coercive, informal: political/referent (i know the CEO), expert (the strongest) Commnuication: skupno dokumentno področje projekta = INFORMATION RETRIEVAL SYSTEM Communication barriers: Infromation overload Cultural differences, language Technology Jargon, lack of expertise Competing messages Distance (?) Communication: peer = horizontal The RECIEVER is responsible that the right information is retained The SENDER is resposible for: making the information clear and unambigious confirming with the reciever that information is properly understood information is entirely received Request seller responses: only plan in the executing phase: »Contract mngmnt plan« PM negotiation: to protect relationship Work performance information: Progress of scehdule Deliverable status Are the q-standards being met Cost authorized and incurred Resource utilization details % of work completede Monitoring and Control Initiation (the CHEAPEST) – closure (the second most cheapest) Baseline vs. work performance information - Corrective actions - Preventive actions - Defect repair - Requested changes Baseline = original approved estimates + approved changes Time phased budget = cost baseline Project Plan Baseline: collection of PM plan documents will be changing throughout the project Performance Measurment Baseline: approved plan for project work. Integrates: SCOPE, SCHEDULE, COST, QUALITY, TECHNICAL parameters. Scope (change) control: integrated with time, cost, quality control Schedule control: SV, SPI; Cost control: CV, CPI Recommended corrective actions are the outputs of these controls. QUALITY control Monitoring project results if they comply with q-standards; eliminate causes of unsatisfactory results Quality control TT: Ishikawa, Pareto, Scatter (x,y), Run chart (trend; x=time), Control limits - defined in the process of QC (OPA) Tolerance limits – on products specification Specification (customer) limits Common cause – acceptable range of variation Special (assignable) cause Rule of 7 Q-theories - Deming - Kaizen - Crosby: do the riht thing firt time; costs of non-confromance>cost of conformance - Juran: Quality is fitness for use (da je nekaj kvalitetno) - Taguchi: parametric design optimization Failure Mode and Effects Analysis (FMEA): effect of component failure on product's reliability Precision: little scatter Accuracy: corectness of value RISK monitoring and control Keep track, new risks Ongoing: new risk identify, analyze impact, response plan… Risk audits: verifies effectivnes of risk response plan and execution risk register UPDATES, Workaround plans to EMERGING RISKS, previously unidentified CONTRACT administration - Ensuring performance of the seller, buyer performs according to the terms of the contract - Payment system: payments to seller accropding to the contract: »account payable system« - Claims administration: claims are demands for disputed changes, »claims admin procedure« Integrated change control - chagnes baselines - coordination of changes across knowledge areas - maintains integrity of performance measurments STATUS report: a detailed report status of a project: what has been acomplished: SCHEDULE, BUDGET, DELIVERABLES VARIANCE report: actual vs planned TREND ANALISYS REPORTS: to predict future variances PROGRESS report: a quick view how much team has accomplished FORECAST report: predicts the future status of the project EV analisys: integrates scope, cost, time to asess project project performance PERFORMANCE reports – not for team assesment provide information on past project performance provide information on current status may alert the team about potential future problems Team member apparaisals – done for each individual by external manager, 360° appraisals Scope verification: process of obtaining formal acceptance of completed deliverables (product, services, documents), from stakeholders. Uses scope statement and WBS. If project is cancelled, terminated, closed: document the level of extent of completion Scope cerification Scope control Acceptance of work results Correcntess of work results (meeting quality standards, limits) Manage project team Track work performance of the team, rsolve issues, manage conflicts, feedback, coordinate changes Sources of conflict: 1.)schedule, 2.)Project priority (the MOST IMPORTANT in initiation), 3.)scarce resources, 4.) technical opinion, 5.) personalities Conflict resolutions: - Problem solving = confrontaion, win-win - Compromising: lose some – lose some; maybe acceptable - Smoothing: lose –win, emphasizes commonality and deemphasizes differences; short time - Forcing: lose-win, forcing one's view point - Withdrawl: lose-leave; dosent resolve conflict, cool-off period PM is resposible for stakeholders management: understand and be understood, gain acceptance of ideas, produce change or action CLOSURE Outsourcing contracts: - Contract closure – process of completing and settling each contract, resolving open items, closing each contract - Procurement audit: review of procurement process from: plan purchases and acquisitions to contract administration - Contract closure: product verification, administrative closure (updating contract records to reflect final results); lessons learnt Close projects: - documenting, finalizing all project activities accross all project process groups - formalize acceptance of the project by sponsor/customer - at the end of project, end of the phase, termination.. - lessons learned, archive project records Early project termination: • Extinction: Stop the project immediately, ga ne rabimo več • Integration: Project results are integrated into the existing organizational units • Addition: Project is institutionalized as a new part of the organization (new product line or new division) • Starvation: Gradually reduce resources so that project dies slowly but surely (it fades out of sight) Project records Project archives Social responsibility 4 tasks of PMP: Ensure individual integrity Contribute to PM management knowledge base Enhace individual competence Respect team's and stakeholder's culture, ethnic and language differences (+ join a training) Responsibility to profession: adhere to candidate/certificate professional practice Process groups are technology independent CAP – control account plan Key element of a contract Mean: arithemtic mean Mode: top frequency number Median: half the numbers have values that are greater than the median Colocation: majority of project team is moved to a central physical location for the life of project The project's information expediter: project manager Expert intreviews for high level project objectives War room: room with all information, meeting place Who plays the most important role in QUALITY function: CUSTOMER If customer is building a contract with not haveing a detailed scope yet, what type of contract would you, as the seller PM, advise him? Fixed price good advice. Legal remedies - Damages: 1. Compensatory damages, also called actual damages, are paid to compensate the claimant for loss, injury, or harm suffered by (see requirement of causation) another's breach of duty. 2. Punitive damages – dodatne kazenske, ko compensatory damages ne zadoščajo 3. Incidental damages - money claimed by, ordered to be paid to, a person as compensation for loss or injury 4. Consequential damages – posledična škoda, ki nastane ko ena od stran breach-a pogoje pogodbe 5. Liquidated damages (also referred to as liquidated and ascertained damages) are damages whose amount the parties designate during the formation of a contract for the injured party to collect as compensation upon a specific breach (e.g., late performance). 6. Reliance damages are valued by a party's reliance interest for the foreseeable amount. It puts the injured party in the same dollar position as if the contract had never been formed. 7. Nominal damages are very small damages awarded to show that the loss or harm suffered was technical rather than actual. Perhaps the most famous nominal damages award in modern times has been the $1 verdict against the National Football League (NFL) 8. Treble damages, in law, is a term that indicates that a statute permits a court to triple the amount of the actual/compensatory damages to be awarded to a prevailing plaintiff, generally in order to punish the losing party for willful conduct. Personal literacy refers to understanding and valuing oneself. The key behaviors: _ Aggressive insight. Committing to a continuous process of self-awareness and renewal. _ Confident humility. Being self-confident, yet humble enough to listen and learn from other people. _ Authentic flexibility. Understanding and accepting the attitudes, beliefs, and behaviors of other people without compromising your own. _ Reflective decisiveness. Balancing thoughtful consideration of all options by acting boldly and forcefully. _ Realistic optimism. Envisioning a better future while acknowledging the constraints of current realities. Social literacy refers to engaging and challenging other people. The key behaviors: _ Pragmatic trust. Combining the attitudes of trusting believers and skeptical pragmatists. _ Urgent listening. Balancing the urgent demands of business with deep listening to the concerns of other people. _ Constructive impatience. Being impatient enough to inspire greater performance without damaging constructive attitudes and relationships. _ Connective teaching. Creating learning networks that enable people to learn collaboratively across organizational and cultural boundaries. _ Collaborative individualism. Uniting the diverse skills and interests of individuals in a common purpose. Business literacy refers to focusing and mobilizing the business. The key roles: _ Chaos navigator. Guiding people through change and managing the unexpected. _ Business geographer. Understanding the business context of the regions and countries where your products and services are made, bought, or sold. _ Technology steward. Learning the e-business and Internet skills required in a technological world. _ Leadership liberator. Creating leaders every day and at every level of the business. _ Economic integrator. Aligning and connecting people, systems, and processes in support of the vision and goals of the organization. Cultural literacy refers to understanding and leveraging cultural differences. The key roles: _ Proud ancestor. Valuing your cultural heritage while acknowledging its shortcomings as well as its strengths. _ Inquisitive internationalist. Looking beyond one’s own culture for business opportunities and resources. _ Respectful modernizer. Retaining the best of one’s culture while using the knowledge and resources of others to modernize for the future. _ Culture bridger. Forming alliances and connections across cultures. _ Global capitalist. Bringing global resources to local problems and opportunities and local resources to global ones. 3 stage Negotiation: Open: Say what you want: i want you to to something Bargain: Hammer out the deal: you know you will have to do it Close: Agree and exchange: i wish i will not be disappointed 8-stage negotiation 1. Prepare: Know what you want. Understand them. 2. Open: Put your case. Hear theirs. 3. Argue: Support your case. Expose theirs. 4. Explore: Seek understanding and possibility. 5. Signal: Indicate your readiness to work together. 6. Package: Assemble potential trades. 7. Close: Reach final agreement. 8. Sustain: Make sure what is agreed happens. Negotiation technique Fait acomplie - An accomplished fact; an action which is completed before those affected by it are in a position to query or reverse it Fait accompli strategy. The fait accompli strategy is a risky one. Basically, one side does whatever it wants and expects the other side to accept the terms and the outcome. Standard practice strategy. The "standard practice" claim infers that what is being suggested is acceptable because it is "standard practice." This strategy is another reason why doing your homework is important. If you are negotiating in an area that may be unfamiliar to you, be sure you research any "standard practice" claims before agreeing to them. Deadline strategy. Time can be a powerful weapon in a negotiation. If the other side knows your deadlines, they may delay giving you a draft (and possibly throw in a few changes) until the last minute to gain the advantage. The closer you are to your deadlines, the more concessions you're likely to make. Therefore, it is important to set a deadline which you are happy with. Decoy strategy. The decoy issue is often used by politicians. This strategy involves inflating the importance of a minor issue to mask the importance of a larger issue or a hidden agenda. If the other side concedes what they have made you believe is a major issue, but what is for them a minor one, they will then expect you to concede on one of your truly important issues. Again, doing your homework will give you an edge in knowing the industry value of various issues. Faking withdrawal strategy. Faking withdrawal from the deal in favour of a competitor is another strategy of which to be wary. Its purpose is to gain a concession, usually a significant one, by pretending to entertain another offer such as one from your competition. If you catch the other party in this strategy, it's probably best to call their bluff and end the negotiations in favor of going elsewhere, perhaps to their competition. Good guy/bad guy strategy. This approach is easy to spot. A common scenario may go something like this: One of the negotiators on the other side is hardcore (definitely not win-win minded) in his/her approach. This strategy may even involve the "bad guy" throwing a temper tantrum. Then, when the bad guy steps out for a few minutes, the good guy half of the negotiating team makes an offer in a less threatening manner. If the other side has resorted to this strategy, it may be best to call them on it or consider terminating the negotiations. Limited authority strategy. The limited authority strategy involves the other side trying to make concessions by claiming they don't have the authority to make concessions on their own. If the other side claims that they do not have the authority to lower the price, but instead need to call a manager, you should halt negotiations with that person and only resume talks with a representative who has the authority to truly negotiate. Salami strategy. The salami technique is used to gain concessions piece by piece. The basic premise is this: Instead of trying to grab the whole salami, cut off thin slices over time. The result is gaining the whole or a good portion of the salami without the other side realising it (Thomas et al 2006).