Project Integration Management: Framework, Processes, and Techniques, Study notes of Project Management

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Chapter 4:

Project Integration Management

Learning Objectives

o Describe an overall framework for project

integration management as it relates to the other project management knowledge areas and the project life cycle.

o Explain the strategic planning process and apply different project selection methods.

o Explain the importance of creating a project charter to formally initiate projects.

Learning Objectives (Cont.)

o Describe the process of monitoring and controlling project work.

o Understand the integrated change control

process, planning for and managing changes on information technology projects, and developing and using a change control system.

o Explain the importance of developing and following good procedures for closing projects.

The Key to Overall Project Success:

Good Project Integration Management

o Project managers must coordinate all of the

other knowledge areas throughout a project’s life cycle.

o Many new project managers have trouble

looking at the “big picture” and want to focus on too many details.

o Project integration management is not the same thing as software integration.

Project Integration Management

Processes (Cont.)

o Direct and manage project execution : Carry out the project management plan by performing the activities included in it.

o Monitor and control the project work : Oversee project work to meet the performance objectives of the project.

o Perform integrated change control : Coordinate changes that affect the project’s deliverables and organizational process assets.

o Close the project : Finalize all project activities to formally close the project.

Project Integration Management Summary

Identifying Potential Projects

o Many organizations follow a planning process for selecting IT projects. o It’s crucial to align IT projects with business strategy. o Research shows that:

n Supporting explicit business objectives is the number one reason cited for investing in IT projects. n Companies with consolidated IT operations have a 24 percent lower operational cost per end user. n The consistent use of IT standards lowers application development costs by 41 percent per user.*

*Cosgrove Ware, Lorraine, “By the Numbers,” CIO Magazine ( www.cio.com ) (September 1, 2002).

Information Technology Planning Process

Focusing on Broad Organizational Needs

o It is often difficult to provide strong

justification for many IT projects, but everyone agrees they have a high value.

o Three important criteria for projects:

n There is a need for the project. n There are funds available for the project. n There is a strong will to make the project succeed.

Categorizing IT Projects

o One categorization assesses whether the project provides a response to: n A problem n An opportunity n A directive

o Another categorization is based on the time it will take to complete a project or the date by which it must be done.

o Another categorization is the overall priority of the project.

Net Present Value Analysis

o Net present value (NPV) analysis is a method

of calculating the expected net monetary gain or loss from a project by discounting all expected future cash inflows and outflows to the present point in time.

o Projects with a positive NPV should be considered if financial value is a key criterion.

o The higher the NPV, the better.

Net Present Value Example

Note that totals are equal, but NPVs are not because of the time value of money.

Payback Analysis

o Another important financial consideration is payback analysis.

o The payback period is the amount of time it will take to recoup, in the form of net cash inflows, the total dollars invested in a project.

o Payback occurs when the cumulative discounted benefits and costs are greater than zero.

o Many organizations want IT projects to have a fairly short payback period.

Charting the Payback Period