Project Management, Planning and Control, Fifth Edition: Managing Engineering, Construction and Manufacturing Projects to PMI, APM and BSI Standards

446 Pages·2006·10.18 MB·English

by  Albert Lester

Project Management, Planning and Control:
Managing Engineering, Construction and Manufacturing Projects to PMI, APM
and BSI Standards by Albert Lester

• ISBN: 075066956X
• Publisher: Elsevier Science & Technology Books
• Pub. Date: November 2006
Cross reference to APM and PMI
bodies of knowledge
Chapter No. Topic APM. BoK No. PMI BoK No.
1 Project definition 1.1, 1.2
2 Project management 1.1, 1.6 1.3
3 Programme management 1.2, 1.3
4 Project context (project environment) 1.4 1.6
5 Business case 5.1, 1.5, 4.1
6 Investment appraisal 5.1
7 Stakeholder management 2.2 2.2, 10.4
8 Project success criteria 2.1
9 Organization structures 6.7 2.3
10 Organizational roles 6.8 2.3
11 Project life cycles 6.1 2.1
12 Work breakdown structures 3.1 5.3
13 Planning blocks and subdivision of 3.2
blocks
14 Estimating 4.3 7.1
15 Project management plan 2.4, 6.9 4.3
16 Risk management 2.5 11.1
17 Quality management 2.6 8.1
18 Change management 3.5, 3.8 4.3, 5.5
19 Configuration management 4.7 5.4
20 Basic network principles 3.2 6.2
21 Analysis types 3.2 6.3
22 Precedence or activity on node (AoN) 3.2 6.4
diagrams
23 Lester diagram 3.2
24 Float 3.2 6.3
25 Milestones and line of balance 3.2 6.4
26 Simple examples 3.2
27 Progress reporting 3.2 10.3
28 Project management and planning 3.2 6.2
29 Network applications outside the 3.2
construction industry
viii CrossreferencetoAPMandPMIbodiesofknowledge
30 Resource loading 3.3, 7.1
31 Cash flow forecasting 3.4 7.3
32 Cost control and EVA 3.6 7.3, 10.3
33 Control graphs and reports 3.6 7.4, 10.3
34 Procurement 5.4 12.1
35 Value management 2.3, 4.5 (5.2)
36 Health and safety and environment 2.7
37 Information management 3.7 10.2
38 Communication 7.1 10.1
39 Team building 7.2 9.3
40 Leadership 7.3, 7.7, 7.9 (2.4)
41 Negotiation 7.5 (2.4)
42 Conflict management and dispute resolution 7.4
43 Project close-out and hand over 6.5 12.6
44 Project close-out report and review 6.6 10.3
( ) = Discussed in context of other topic.
Foreword to the first edition
by Geoffrey Trimble, Professor of Construction Management,
University of Technology, Loughborough
A key word in the title of this book is ‘control’. This word, in the context of management,
implies the observation of performance in relation to plan and the swift taking of corrective
actionwhentheperformanceisinadequate.Incontrasttomanyotherpublicationswhichpurport
to deal with the subject, the mechanism of control permeates the procedures that Mr Lester
advocates. In some chapters, such as that on Manual and Computer Analysis, it is there by
implication. In others, such as that on Cost Control, it is there in specific terms.
Thebook,inshort,dealswithrealproblemsandtheirrealsolutions.Icommendittherefore
bothtostudentswhoseektounderstandthesubjectandtomanagerswhowishtosharpentheir
performance.
Preface
The shortest distance between two points is a straight line
Euclid
The longest distance between two points is a shortcut
Lester
The first edition of this book dealt mainly with the fundamentals and industrial applications
of network analysis and a cost/progress control technique called SMAC, which is now known
universally as earned value analysis.
In the light of the rapid advances in computers, especially the development of the PC, the
second edition updated these techniques and included a detailed description of a well-known
computerized project management program.
The third edition expanded the earned value section, described two other computer project
management programs and introduced some of the other ‘hard topics’ required by a project
manager.
BecauseofthedemandcreatedbystudentstakingtheAssociationforProjectManagement’s
APMP examination, the fourth edition included all the hard topics required in the examination
syllabus. The soft topics were deliberately not included, as these were applicable to general
management and not exclusive to project management. To illustrate how these hard topic
techniquescanbeappliedandincorporatedinpractice,severalfullyworkedexamplesoftypical
projects were included.
As with the previous volumes, this fifth edition was written to meet a specific need. In this
case it was the fulfilment of a request by the publishers and some of my lecturing colleagues
at University College London, to produce a book which included all the hard and soft topics
requiredbythelatestsyllabusoftheAPMPexamination.Inadditionthebookshouldalsomeet
the needs of the PMI examination as stipulated in the PMI Body of Knowledge.
When starting a new edition, one inevitably wonders whether any section of the current
edition has become obsolete and whether it should therefore be updated or left out altogether.
After all, a plethora of computer-generated coloured printouts such as Gantt charts showing
base schedules and updates, tables, summaries, histograms, pie charts, ‘S’ curves and even
networks themselves have replaced hand-drawn or typed documents. My first thoughts were
therefore to leave out the chapters on arithmetical analysis and the case for manual analysis
sincenearlyallnetworkplanningisnowcarriedoutbysophisticatedcomputerprogramswhich
not only take the chores out of the analysis process, but also enable ‘what if’ scenarios to be
rapidly examined.
However, we have not yet reached the stage when computers can think for themselves, so
that the creation of the logic of a network must still be done by humans. Except for standard
repetitive projects where it is possible to design logic modules, each project network of any
xii Preface
reasonable size should still be hand-drafted and discussed with colleagues before being keyed
into the computer for processing. For this reason the section on manual analysis has been
retained. In any case the trend to generate a Gantt chart direct from a table of preceding and
succeeding activities and then printing out a network diagram is putting the cart before the
horse.Suchapracticereducesthepossibilityofmaximizingparallelactivitiesandreducingthe
overalldurationoftheproject.Inotherwords,itdestroystheveryessenceofnetworkanalysis.
A single textbook can never replace a good course of lectures on project management in
which a lecturer can illustrate the subject with anecdotes from his or her own experience. For
this reason some of the subjects in the book have been enhanced by descriptions and practical
advice useful to a practising project manager who may already have passed the qualifying
project management examinations.
Thebookhasbeendesignedtobenotonlyastudytextforexaminees,butalsoamanualfor
professional managers. Exercises and sample examination questions and answers (except for
thesetofbulletpoints)havethereforenotbeenincludedbutcanbefoundonthebook’saccom-
panyingwebsitehttp://books.elsevier.com/companions/075066956X.Inaddition,33questions
and answers can also be found on the companion web site.
The worked examples at the end of the book, which are only loosely representative of the
fourchosenindustries,havebeenincludedbecause,aftermanyyearsoflecturing,Ifoundthat
what students appreciated most was the opportunity to see how all the project management
techniques they were taught during the course actually ‘hang together’. The important thing to
remember is that not all the techniques are applicable to all situations and certainly not to all
themanytypesofprojects,butmanagersshouldregardthisbookasatoolboxfromwhichthe
most appropriate tool can be used for the particular job in hand.
Project management methods have been adopted by many manufacturing industries, com-
mercial organizations and financial institutions since they were first brought to the UK in the
early 1950s by the American petrochemical construction companies and as most of my expe-
rience has been with major civil engineering and process plant contractors, it is not surprising
therefore that many of the examples in the book have been taken from these industries. I
must stress, however, that all the techniques given can be tailored or modified to suit other
industries,evenifnotallofthemappeartobeimmediatelyapplicable.Clearlyaknowledgeof
man management, communication management, health and safety and cost control is required
for every type of project whatever the nature of the enterprise, but there is no doubt that by
applying some of the less-well-known techniques such as network analysis and earned value
analysis, performance and control can be enhanced.
A. Lester
Acknowledgements
Theauthorandpublisherswouldliketomakeacknowledgementtothefollowingfortheirhelp
and cooperation in the preparation of this book.
TheNationalEconomicDevelopmentOfficeforpermissiontoreproducetherelevantsection
of their report ‘Engineering Construction Performance Mechanical & Electrical Engineering
Construction, EDC, NEDO December 1976’.
FosterWheelerPowerProductsLimitedforassistanceinpreparingthetextandmanuscripts
and permission to utilize the network diagrams of some of their contracts.
Mr P. Osborne for assistance in producing some of the computerized examples.
Claremont Controls Limited, Suite 43, Wansbeck Business Centre, Rotary Parkway, Ash-
ington,NorthumberlandNE638QZ,forthedescriptionanddiagramsoftheirHornetWindmill
project management software.
ExtractsfromBS6079-1-2002arereproducedwiththepermissionofBSIunderlicenceNo.
2003DH0199. Complete editions of the standards are obtainable by post from BSI Customer
Services, 389 Chiswick High Road, London W4 4AL. Tel. [phone].
A.P.WattforpermissiontoquotethefirstverseofRudyardKipling’spoem,‘TheElephant’s
Child’.
Daimler Chrysler for permission to use their diagram of the Mercedes-Benz 190 car.
The Automobile Association for the diagram of an engine.
WPMCfortheiragreementtousesomeofthediagramsinthechaptersonRiskandQuality
management
Jane Walker and University College London for permission to include diagrams in the
chapters on project context, leadership and negotiations
The Association for Project Management for permission to reproduce their APMP Learning
Objectives
Tony Benning, my co-author of ‘Procurement in the Process Industry’, for permission to
include certain texts from that book.
Table of Contents

Cross reference to APM and PMI bodies of knowledge vii
Foreword to the first edition ix
Preface xi
Acknowledgements xiii
Project definition 1
Project management 5
Programme management 9
Project context (project environment) 12
Business case 17
Investment appraisal 20
Stakeholder management 27
Project success criteria 30
Organization structures 32
Organization roles 35
Project life cycles 37
Work breakdown structures 40
Planning blocks and subdivision of blocks 46
Estimating 57
Project management plan 61
Risk management 65
Quality management 73
Change management 84
Configuration management 88
Basic network principles 90
Analysis types 102
Precedence or activity on node (AoN) diagrams 125
Lester diagram 132
Float 136
Milestones and line of balance 142
Simple examples 147
Progress reporting 158
Project management and planning 165
Network applications outside the construction industry 176
Resource loading 188
Cash flow forecasting 195
Cost control and EVA 204
Control graphs and reports 212
Procurement 238
Value management 275