TEAM LinG i (cid:1)(cid:2)(cid:3)(cid:4)(cid:5)(cid:6)(cid:7)(cid:8) (cid:9)(cid:10)(cid:11)(cid:10)(cid:12)(cid:5)(cid:13)(cid:5)(cid:11)(cid:7) (cid:14)(cid:3)(cid:2)(cid:8) (cid:9)(cid:3)(cid:15)(cid:5)(cid:2)(cid:11) (cid:16)(cid:11)(cid:14)(cid:3)(cid:2)(cid:13)(cid:10)(cid:7)(cid:17)(cid:3)(cid:11)(cid:8) (cid:18)(cid:19)(cid:20)(cid:7)(cid:5)(cid:13)(cid:20) Dan Brandon, PhD, PMP Christian Brothers University, USA (cid:16)(cid:21)(cid:9)(cid:8)(cid:1)(cid:2)(cid:5)(cid:20)(cid:20) (cid:1)(cid:22)(cid:23)(cid:24)(cid:17)(cid:20)(cid:25)(cid:5)(cid:2)(cid:8)(cid:3)(cid:14)(cid:8)(cid:17)(cid:11)(cid:11)(cid:3)(cid:26)(cid:10)(cid:7)(cid:17)(cid:26)(cid:5)(cid:8)(cid:20)(cid:6)(cid:25)(cid:3)(cid:24)(cid:10)(cid:2)(cid:24)(cid:19)(cid:8)(cid:10)(cid:11)(cid:15)(cid:8)(cid:27)(cid:2)(cid:3)(cid:14)(cid:5)(cid:20)(cid:20)(cid:17)(cid:3)(cid:11)(cid:10)(cid:24) (cid:17)(cid:11)(cid:14)(cid:3)(cid:2)(cid:13)(cid:10)(cid:7)(cid:17)(cid:3)(cid:11)(cid:8)(cid:7)(cid:5)(cid:6)(cid:25)(cid:11)(cid:3)(cid:24)(cid:3)(cid:12)(cid:19)(cid:8)(cid:7)(cid:17)(cid:7)(cid:24)(cid:5)(cid:20)(cid:8)(cid:17)(cid:11)(cid:8)(cid:7)(cid:25)(cid:5)(cid:8)(cid:6)(cid:19)(cid:23)(cid:5)(cid:2)(cid:10)(cid:12)(cid:5) Hershey • London • Melbourne • Singapore TEAM LinG ii Acquisitions Editor: Michelle Potter Development Editor: Kristin Roth Senior Managing Editor: Amanda Appicello Managing Editor: Jennifer Neidig Copy Editor: Becky Shore Typesetter: Diane Huskinson Cover Design: Lisa Tosheff Printed at: Integrated Book Technology Published in the United States of America by IRM Press (an imprint of Idea Group Inc.) 701 E. Chocolate Avenue, Suite 200 Hershey PA 17033-1240 Tel: 717-533-8845 Fax: 717-533-8661 E-mail: [email protected] Web site: http://www.irm-press.com and in the United Kingdom by IRM Press (an imprint of Idea Group Inc.) 3 Henrietta Street Covent Garden London WC2E 8LU Tel: 44 20 7240 0856 Fax: 44 20 7379 0609 Web site: http://www.eurospanonline.com Copyright © 2006 by Idea Group Inc. All rights reserved. No part of this book may be reproduced, stored or distributed in any form or by any means, electronic or mechanical, including photocopying, without written permission from the publisher. Product or company names used in this book are for identification purposes only. Inclusion of the names of the products or companies does not indicate a claim of ownership by IGI of the trademark or registered trademark. Library of Congress Cataloging-in-Publication Data Brandon, Dan, 1946- Project management for modern information systems / Dan Brandon. p. cm. Summary: "This book describes and illustrates practices, procedures, methods, and tools for IT project management that address project success for modern times"--Provided by publisher. Includes bibliographical references and index. ISBN 1-59140-694-3 (softcover : alk. paper) -- ISBN 1-59140-695-1 (ebook : alk. paper) 1. Project management. 2. Management information systems. I. Title. HD69.P75.B733 2005 004'.068'4--dc22 2005022459 ISBN (hardcover) 1-59140-693-5 British Cataloguing in Publication Data A Cataloguing in Publication record for this book is available from the British Library. All work contributed to this book is new, previously-unpublished material. The views expressed in this book are those of the authors, but not necessarily of the publisher. TEAM LinG iii (cid:28)(cid:5)(cid:15)(cid:17)(cid:6)(cid:10)(cid:7)(cid:17)(cid:3)(cid:11) This book is dedicated to my family, who had to settle for less of my attention during the writing of this book, but who, nonetheless, enthusiastically sup- ported me; specifically to my father and mother, Dan and Shirley, who in- stilled in me the principles and ethics that have guided my life, and to my children, Madison and Victoria, whose presence are my greatest blessing. TEAM LinG iv (cid:1)(cid:2)(cid:3)(cid:4)(cid:5)(cid:6)(cid:7)(cid:8) (cid:9)(cid:10)(cid:11)(cid:10)(cid:12)(cid:5)(cid:13)(cid:5)(cid:11)(cid:7) (cid:14)(cid:3)(cid:2)(cid:8)(cid:9)(cid:3)(cid:15)(cid:5)(cid:2)(cid:11) (cid:16)(cid:11)(cid:14)(cid:3)(cid:2)(cid:13)(cid:10)(cid:7)(cid:17)(cid:3)(cid:11)(cid:8) (cid:18)(cid:19)(cid:20)(cid:7)(cid:5)(cid:13)(cid:20) (cid:29)(cid:10)(cid:23)(cid:24)(cid:5)(cid:8)(cid:3)(cid:14)(cid:8)(cid:30)(cid:3)(cid:11)(cid:7)(cid:5)(cid:11)(cid:7)(cid:20) Preface ........................................................................................................................viii Acknowledgment......................................................................................................... xii Chapter I Today’s IT Environment .................................................................................................1 The Information Revolution.................................................................................2 Better, Cheaper, Faster.........................................................................................4 Teamed-Based Workplaces .................................................................................6 Projects and Project Management........................................................................9 The Project Manager..........................................................................................11 IT Project Management......................................................................................13 Chapter II Critical Success Factors for IT Projects.................................................................... 18 Definition of Success.........................................................................................18 Completion and Satisfaction Criteria..................................................................19 Generalization of Success Factors for IT............................................................20 Managing for Success .......................................................................................24 Chapter III Project Selection and Initiation .................................................................................. 29 Organizational Planning.....................................................................................29 Project Initiation.................................................................................................31 Project Proposals ...............................................................................................32 Project Business Plan.........................................................................................34 Financial Evaluation and Selection Methods.....................................................35 Decision Trees...................................................................................................37 Project Scoring Methods ...................................................................................42 Project Stage Gates ............................................................................................45 TEAM LinG v Chapter IV The Project Management Discipline .......................................................................... 48 Project Management Organizations...................................................................48 Project Management Institute............................................................................50 Project Management Body of Knowledge.........................................................50 Chapter V The Software Engineering Discipline ........................................................................ 59 Software Engineering vs. Project Management .................................................59 Software Development Lifecycle Methodology.................................................60 Management Stage Gates ..................................................................................65 SDLC Variations and Alternatives .....................................................................66 Development Acceleration.................................................................................71 Modern SDLC Implementations.........................................................................74 Object-Oriented Software...................................................................................79 Software Reuse ..................................................................................................85 Software Engineering Institute...........................................................................88 Institute of Electrical and Electronics Engineers................................................92 Other Software Standards Organizations...........................................................94 Chapter VI Project Overall Planning............................................................................................ 98 The Project Charter ............................................................................................98 The Project Master Plan...................................................................................100 Project Calendars and Fiscal Periods ...............................................................100 Kickoff Meeting...............................................................................................104 Scope Management .........................................................................................106 Requirements Analysis....................................................................................109 Chapter VII Developing the Schedule and Cost Plan.................................................................... 120 Detail Project Planning.....................................................................................121 Developing the Work Breakdown Structure....................................................122 Task Estimation................................................................................................133 Task Sequencing and The Critical Path ...........................................................143 Scheduling.......................................................................................................147 Resource Assignment and Costing Methods..................................................150 Developing the Cost Plan ................................................................................152 Chapter VIII Risk Planning and Management...............................................................................157 Project Risks and Opportunities.......................................................................157 Risk Identification............................................................................................160 Risk Quantification...........................................................................................166 Risk Response Development ...........................................................................169 Risk Plan Example.............................................................................................175 Risk Response Control.....................................................................................179 TEAM LinG vi Chapter IX Project Execution and Control..................................................................................183 The Control Process.........................................................................................183 What to Control...............................................................................................185 Measurement of Completion Factors...............................................................186 Measurement of Satisfaction Factors ..............................................................191 Measuring and Reporting................................................................................193 Stage Gate Implementation...............................................................................195 Corrective Actions...........................................................................................197 Chapter X Managing Quality .....................................................................................................202 Quality Management........................................................................................202 Quality Planning...............................................................................................204 Quality Assurance ...........................................................................................208 Quality Control.................................................................................................209 Software Testing..............................................................................................212 Quality Stage Gates..........................................................................................220 Quality Programs..............................................................................................223 Software Development Standards....................................................................227 Chapter XI Change and Closeout Management...........................................................................234 Project Changes...............................................................................................234 Establishing a Change Control System............................................................236 Version Control................................................................................................239 Configuration Control......................................................................................240 Scope Creep.....................................................................................................241 Project Closeout...............................................................................................243 Chapter XII Procurement and Outsourcing.................................................................................248 Procurement.....................................................................................................248 Procurement Planning......................................................................................251 Solicitation Planning ........................................................................................253 Solicitation .......................................................................................................255 Source Selection...............................................................................................255 Contract Administration and Closeout ............................................................257 SEI SA-CMM..................................................................................................257 Outsourcing.....................................................................................................258 Chapter XIII Stakeholder Management.........................................................................................274 Stakeholder Identification and Analysis..........................................................274 Communication Management ..........................................................................278 Organizational Context.....................................................................................286 Human Resource Management........................................................................291 Managing the Project Team.............................................................................297 TEAM LinG vii Chapter XIV Performance Reporting and Earned Value Analysis................................................309 Traditional Performance Reporting ..................................................................310 Earned Value Analysis.....................................................................................316 Effective Implementation of EVA.....................................................................322 Progress Reporting ..........................................................................................324 Actual Cost Data..............................................................................................327 Other EVA Issues ............................................................................................331 EVA, Success Factors, and Stage Gates..........................................................333 Chapter XV Software Systems for Project Management .............................................................338 Spreadsheets....................................................................................................338 General Project Management Software ............................................................343 Open Source Software......................................................................................345 The FiveAndDime System...............................................................................348 Chapter XVI Managing Multiple Projects.....................................................................................351 The Project Management Office.......................................................................352 Portfolio Management......................................................................................357 Knowledge Management.................................................................................365 Lessons Learned..............................................................................................367 Standard Forms and Templates........................................................................372 Global Projects.................................................................................................372 The PMO Portal ...............................................................................................374 Project Management Maturity .........................................................................376 Project Management and Strategic Planning ...................................................378 Glossary and Acronyms............................................................................................385 About the Author.......................................................................................................405 Index ........................................................................................................................407 TEAM LinG viii (cid:1)(cid:2)(cid:5)(cid:14)(cid:10)(cid:6)(cid:5) In the past, the formal discipline of project management was applied primarily to very large projects lasting several years and costing millions of dollars; this was as true for information technology (IT) projects as it was for other industries. Furthermore in the 20th century, project management methods were largely based upon “command and control” techniques. These techniques evolved from ancient military regimes and dic- tatorial governments, where relatively few educated people directed large numbers of uneducated people. Some industries are still that way, but many companies and most IT organizations are evolving into team- and project-based environments using knowl- edge workers, independent contractors, and, perhaps, various forms of outsourcing. Competitive advantage today is increasingly based upon knowledge assets instead of upon the traditional assets of land, labor, and capital. In addition there is now a separa- tion of “work” from “workplace,” and operations may be performed on a global scale. To be successful in our IT projects (and most IT projects are still not successful), it is imperative that we apply formal project management methods and tools to all IT project- based work. Also the formal methods and tools of project management need to evolve to address the changes in modern software engineering and our high-tech global work- places. In the past, project success was defined too narrowly as simply meeting time and cost constraints for a given scope of work. However, in order for an IT project to be completely successful, that basic definition of success needs to be extended. This extension is particular with regard to product quality, stakeholder satisfaction, security, organizational human capital, and long-term factors such as maintainability and adapt- ability. With that extended definition of success, management techniques and tools can be extended or otherwise modified to be more effective. This book describes and illustrates practices, methods, and tools for IT project man- agement that address this extended definition of project success for modern times. As such, this book is directed to IT project managers, those IT personnel aspiring to become project managers, and also to experienced IT personnel who wish to learn of new project management concepts, methods, and tools. This book is also designed for use as a textbook or reference in graduate or upper-level undergraduate university TEAM LinG ix programs in IT or project management. Throughout the book, a number of IT project management “standard forms” are presented and a number of spreadsheet models are also developed. An open source general Web-based project management software sys- tem (FiveAndDime) is used to illustrate many of the methods and applications dis- cussed in the book. An appendix of the book contains a glossary of the IT project management and software engineering terms and acronyms used. Chapter I introduces and defines a project, project management, the project manager, and project stakeholders. These management concepts are discussed relative to our modern IT dominated world and in context with today’s “information revolution” and to the business and technical forces that drive this revolution. The distinctions of IT project management as compared to general project management are also identified here. Chapter II introduces the concept of project “critical success factors.” A key factor leading to the continued failure in IT projects is the lack of identification and apprecia- tion for all the major components of project success. Critical success factors are those things that must be done or handled properly for a project to be successful. A compre- hensive model of critical success factors for IT projects permits the development of better management plans, processes, and metrics particularly for risk, quality, and per- formance control. In this chapter, general critical IT success factors are identified and techniques for the management of those factors are introduced. The notion of a “dual stage gate process” for the comprehensive and effective management of these success factors is also introduced in this chapter; later chapters define metrics and control methods for these success factors using dual stage gating. Chapter III discusses project initiation and selection. The careful selection of which projects to initiate is vital to the success of an organization. Project initiation repre- sents a future commitment of both human and financial resources as well as of manage- ment attention. In this chapter, methods for the proper selection and initiation of projects are discussed with regard to overall organizational goals and business justification. In this chapter, project initiation and the processes and documents involved with project evaluation from a business perspective are discussed and illustrated. Standard forms for the “project proposal” and “project business plan” are presented. (Later, Chapter VI continues with the life of a project after an organization has committed to perform said project.) Chapters IV and V discuss project management and software engineering from a disci- plinary perspective, as these concepts and terms are used throughout the remainder of this book. A number of worldwide professional organizations have been developed to foster the project management discipline, and these organizations and their bodies of knowledge are presented in Chapter V. Although software engineering is not a formal part of project management, it is vital for the proper planning of IT projects. Even for IT projects that primarily involve software acquisition and integration instead of software development, the software engineering embedded in the products that are acquired will significantly affect long-term project success factors. In Chapter V, modern software engineering and its relation to IT project management is discussed. Key challenges to software engineering in the 21st century are presented as well as how software engineering together with project management can address those challenges. TEAM LinG