Y L F M A E T Team-Fly® Page i Project Management Page ii Dr. Kerzner's 16 Points to Project Management Maturity 1. Adopt a project management methodology and use it consistently. 2. Implement a philosophy that drives the company toward project management maturity and communicate it to everyone. 3. Commit to developing effective plans at the beginning of each project. 4. Minimize scope changes by committing to realistic objectives. 5. Recognize that cost and schedule management are inseparable. 6. Select the right person as the project manager. 7. Provide executives with project sponsor information, not project management information. 8. Strengthen involvement and support of line management. 9. Focus on deliverables rather than resources. 10. Cultivate effective communication, cooperation, and trust to achieve rapid project management maturity. 11. Share recognition for project success with the entire project team and line management. 12. Eliminate non-productive meetings. 13. Focus on identifying and solving problems early, quickly, and cost effectively. 14. Measure progress periodically. 15. Use project management software as a tool—not as a substitute for effective planning or interpersonal skills. 16. Institute an all-employee training program with periodic updates based upon documented lessons learned. Page iii Project Management A Systems Approach to Planning, Scheduling, and Controlling Seventh Edition Harold Kerzner, Ph.D. Division of Business Administration Baldwin-Wallace College Berea, Ohio Page iv Copyright © 2001 by John Wiley & Sons. All rights reserved. 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This title is also available in print as ISBN 0-471-39342-8 (cloth : alk. paper) For more information about Wiley products, visit our web site at www.Wiley.com Page v To Dr. Herman Krie r, my Friend and Gu ru, who taught me well the meaning of the word "persistence" Page vii Contents Preface xix 1 1 Overview 1.0 Introduction 1 1.1 Understanding Project Management 2 1.2 Defining Project Success 5 1.3 The Project Manager–Line Manager Interface 6 1.4 Defining the Project Manager's Role 9 1.5 Defining the Functional Manager's Role 12 1.6 Defining the Functional Employee's Role 15 1.7 Defining the Executive's Role 16 1.8 Working with Executives 16 1.9 The Project Manager As the Planning Agent 17 1.10 Project Champions 19 1.11 The Downside Risk of Project Management 20 1.12 Project-Driven Versus Non–Project-Driven Organizations 24 1.13 Marketing in the Project-Driven Organization 26 1.14 Classification of Projects 29 1.15 Location of the Project Manager 30 1.16 Differing Views of Project Management 32 1.17 Concurrent Engineering: A Project Management 34 Approach 1.18 Total Quality Management (TQM): A Project Management 35 Approach Problems 39 Case Studies Jackson Industries 42 Kombs Engineering 44 Williams Machine Tool Company 45 Page viii 2 47 Project Management Growth: Concepts and Definitions 2.0 Introduction 47 2.1 General Systems Management 47 2.2 Project Management: 1960–1985 48 2.3 Project Management: 1985–2000 60 2.4 Resistance to Change 65 2.5 Systems, Programs, and Projects: A Definition 70 2.6 Product Versus Project Management: A Definition 72 2.7 Maturity and Excellent: A Definition 74 2.8 Informal Project Management: A Definition 75 2.9 Project Life Cycles 76 2.10 Project Management Methodologies: A Definition 83 2.11 Systems Thinking 86 Problems 89 Case Studies L. P. Manning Corporation 89 Project Firecracker 90 3 97 Organizational Structures 3.0 Introduction 97 3.1 Organizational Work Flow 100 3.2 Traditional (Classical) Organization 101 3.3 Developing Work Integration Positions 105 3.4 Line–Staff Organization (Project Coordinator) 109 3.5 Pure Product (Projectized) Organization 110 3.6 Matrix Organizational Form 113 3.7 Modification of Matrix Structures 124 3.8 Center for Project Management Expertise 128 3.9 Matrix Layering 129 3.10 Selecting the Organizational Form 131 3.11 Structuring the Small Company 139 3.12 Strategic Business Unit (SBU) Project Management 141 3.13 Transitional Management 143 Problems 145 Case Studies Jones and Shephard Accountants, Inc. 151 Fargo Foods 154 Quasar Communications, Inc. 156