case study 4 1 in search of effective project managers

Project Management: Achieving Competitive Advantage, Fifth Edition by Jeffrey K. Pinto

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CASE STUDY 4.1 In Search of Effective Project Managers

Pureswing Golf, Inc., manufactures and sells a full line of golf equipment including clubs, golf balls, leisurewear, and ancillary equipment (bags, rain gear, towels, etc.). The company competes in a highly competitive and fast-paced industry against better-known competitors such as Nike, Taylor Made, Titleist, PING, Calloway, and Cleveland. Among the keys to success in this industry are the continuous introduction of new club models, innovative engineering and design, and speed to market. As a smaller company trying to stay abreast of stronger competitors, Pureswing places great emphasis on the project management process to remain profitable. At any time, the company will have more than ...

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List of Cases by Chapter

Development Projects in Lagos, Nigeria 2 “Throwing Good Money after Bad”: the BBC’s

Digital Media Initiative 10 MegaTech, Inc. 29

The IT Department at Hamelin Hospital 30 Disney’s Expedition Everest 31

Rescue of Chilean Miners 32 Chapter 2

Tesla’s $5 Billion Gamble 37

Electronic Arts and the Power of Strong Culture in Design Teams 64

Rolls-Royce Corporation 67

Classic Case: Paradise Lost—The Xerox Alto 68

Project Task Estimation and the Culture of “Gotcha!” 69 Widgets ’R Us 70

Project Selection Procedures: A Cross-Industry Sampler 77

Project Selection and Screening at GE: The Tollgate Process 97

Keflavik Paper Company 111

Project Selection at Nova Western, Inc. 112 Chapter 4

Leading by Example for the London Olympics— Sir John Armitt 116

Dr. Elattuvalapil Sreedharan, India’s Project Management Guru 126

The Challenge of Managing Internationally 133 In Search of Effective Project Managers 137

Finding the Emotional Intelligence to Be a Real Leader 137 Problems with John 138

“We look like fools.”—Oregon’s Failed Rollout of Its ObamacareWeb Site 145

Statements of Work: Then and Now 151 Defining a Project Work Package 163 Boeing’s Virtual Fence 172

California’s High-Speed Rail Project 173 Project Management at Dotcom.com 175 The Expeditionary Fighting Vehicle 176 Chapter 6

Engineers Without Borders: Project Teams Impacting Lives 187

Tele-Immersion Technology Eases the Use of Virtual Teams 203

Columbus Instruments 215

The Bean Counter and the Cowboy 216

Johnson & Rogers Software Engineering, Inc. 217

The Building that Melted Cars 224

Bank of America Completely Misjudges Its Customers 230 Collapse of Shanghai Apartment Building 239

Classic Case: de Havilland’s Falling Comet 245

The Spanish Navy Pays Nearly $3 Billion for a Submarine That Will Sink Like a Stone 248

Classic Case: Tacoma Narrows Suspension Bridge 249 Chapter 8

Sochi Olympics—What’s the Cost of National Prestige? 257

The Hidden Costs of Infrastructure Projects—The Case of Building Dams 286

Boston’s Central Artery/Tunnel Project 288 Chapter 9

After 20 Years and More Than $50 Billion, Oil is No Closer to the Surface: The Caspian Kashagan Project 297 Chapter 10

Enlarging the Panama Canal 331

Project Scheduling at Blanque Cheque Construction (A) 360 Project Scheduling at Blanque Cheque Construction (B) 360 Chapter 11

Developing Projects Through Kickstarter—Do Delivery Dates Mean Anything? 367

Eli Lilly Pharmaceuticals and Its Commitment to Critical Chain Project Management 385

It’s an Agile World 396 Ramstein Products, Inc. 397 Chapter 12

Hong Kong Connects to the World’s Longest Natural Gas Pipeline 401

The Problems of Multitasking 427 Chapter 13

New York City’s CityTime Project 432 Earned Value at Northrop Grumman 451 The IT Department at Kimble College 463 The Superconducting Supercollider 464 Boeing’s 787 Dreamliner: Failure to Launch 465 Chapter 14

Duke Energy and Its Cancelled Levy County Nuclear Power Plant 478

Aftermath of a “Feeding Frenzy”: Dubai and Cancelled Construction Projects 490

New Jersey Kills Hudson River Tunnel Project 497 The Project That Wouldn’t Die 499

The Navy Scraps Development of Its Showpiece Warship—Until the Next Bad Idea 500

Jeffrey K. Pinto

Pennsylvania state university.

Boston Columbus Indianapolis New York San Francisco Hoboken Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi

Mexico City São Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo

To Mary Beth, my wife, with the most profound thanks and love for her unwavering support. And, to our children, Emily, AJ, and Joseph—three “projects” that are definitely

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Library of Congress Cataloging-in-Publication Data Pinto, Jeffrey K.

Project management : achieving competitive advantage/Jeffrey K. Pinto.—Fourth edition.

Includes index.

ISBN 978-0-13-379807-4 (alk. paper)—ISBN 0-13-379807-0 (alk. paper) 1. Project management. I. Title. HD69.P75P5498 2016 658.4'04—dc23 2014036595 10 9 8 7 6 5 4 3 2 1 ISBN 10: 0-13-379807-0 ISBN 13: 978-0-13-379807-4

BrIEF COnTEnTS

Preface xiii

Chapter1 Introduction: Why Project Management? 1

Chapter2 The Organizational Context: Strategy, Structure, and Culture 36

Chapter3 Project Selection and Portfolio Management 76

Chapter4 Leadership and the Project Manager 115

Chapter5 Scope Management 144

Chapter6 Project Team Building, Conflict, and Negotiation 186

Chapter7 Risk Management 223

Chapter8 Cost Estimation and Budgeting 256

Chapter9 Project Scheduling: Networks, Duration Estimation, and Critical Path 296

Chapter10 Project Scheduling: Lagging, Crashing, and Activity Networks 330

Chapter11 Advanced Topics in Planning and Scheduling: Agile and Critical Chain 366

Chapter12 Resource Management 400

Chapter13 Project Evaluation and Control 431

Chapter14 Project Closeout and Termination 477

Appendix A The Cumulative Standard Normal Distribution 509 Appendix B Tutorial for MS Project 2013 510

Appendix C Project Plan Template 520 Glossary 524

Company Index 534 Name Index 535 Subject Index 538

Chapter 1 IntroduCtIon: Why ProjeCt ManageMent? 1

Project Profile: Development Projects in Lagos, Nigeria 2

Introduction 4

1.1 What Is a Project? 5

General Project Characteristics 6

1.2 Why Are Projects Important? 9

Project Profile: “Throwing Good Money after Bad”: the BBC’s Digital Media Initiative 10

1.3 Project Life Cycles 13

◾ Box 1.1: Project Managers in Practice 15 1.4 Determinants of Project Success 16

◾ Box 1.2: Project Management Research in Brief 19 1.5 Developing Project Management Maturity 19 1.6 Project Elements and Text Organization 23

Summary  27  •  Key Terms  29  •  Discussion Questions  29 •  Case Study 1.1 MegaTech, Inc.  29  •  Case Study 1.2 The IT

 Department at Hamelin Hospital  30  •  Case Study 1.3 Disney’s Expedition  Everest  31  •  Case Study 1.4 Rescue of Chilean Miners  32  •  Internet  Exercises  33  •  PMP Certification Sample Questions  34  •  Notes  34 Chapter 2 the organIzatIonal Context: Strategy, StruCture,

and Culture 36

Project Profile: Tesla’s $5 Billion Gamble 37

Introduction 38

2.1 Projects and Organizational Strategy 39 2.2 Stakeholder Management 41

Identifying Project Stakeholders 42 Managing Stakeholders 45

2.3 Organizational Structure 47

2.4 Forms of Organizational Structure 48

Functional Organizations 48 Project Organizations 50 Matrix Organizations 53

Moving to Heavyweight Project Organizations 55 ◾ Box 2.1: Project Management Research in Brief 56 2.5 Project Management Offices 57

2.6 Organizational Culture 59

How Do Cultures Form? 61

Organizational Culture and Project Management 63

Project Profile: Electronic Arts and the Power of Strong Culture in Design Teams 64

Summary  65  •  Key Terms  67  •  Discussion Questions  67  •  Case

Study 2.1 Rolls-Royce Corporation  67  •  Case Study 2.2 Classic Case:

Paradise Lost—The Xerox Alto  68  •  Case Study 2.3 Project Task Estimation and the Culture of “Gotcha!”  69  •  Case Study 2.4 Widgets ’R Us 70 •  Internet Exercises  70  •  PMP Certification Sample Questions  70  •  Integrated Project—Building Your Project Plan  72  •  Notes  74

Contents v Chapter 3 ProjeCt SeleCtIon and PortfolIo ManageMent 76

Project Profile: Project Selection Procedures: A Cross-Industry Sampler 77

Introduction 78

3.1 Project Selection 78

3.2 Approaches to Project Screening and Selection 80

Method One: Checklist Model 80

Method Two: Simplified Scoring Models 82 Limitations of Scoring Models 84

Method Three: The Analytical Hierarchy Process 84 Method Four: Profile Models 88

3.3 Financial Models 90

Payback Period 90 Net Present Value 92 Discounted Payback 94 Internal Rate of Return 94

Choosing a Project Selection Approach 96

Project Profile: Project Selection and Screening at GE: The Tollgate Process 97

3.4 Project Portfolio Management 98

Objectives and Initiatives 99

Developing a Proactive Portfolio 100

Keys to Successful Project Portfolio Management 103 Problems in Implementing Portfolio Management 104

Summary  105  •  Key Terms  106  •  Solved Problems  107  •  Discussion Questions  108  •  Problems  108  •  Case Study 3.1 Keflavik Paper Company  111  •  Case Study 3.2 Project Selection at Nova Western, Inc.  112  •  Internet Exercises  113  •  Notes  113

Chapter 4 leaderShIP and the ProjeCt Manager 115

Project Profile: Leading by Example for the London Olympics—Sir John Armitt 116

Introduction 117

4.1 Leaders Versus Managers 118 4.2 How the Project Manager Leads 119

Acquiring Project Resources 119 Motivating and Building Teams 120 Having a Vision and Fighting Fires 121 Communicating 121

◾ Box 4.1: Project Management Research in Brief 124 4.3 Traits of Effective Project Leaders 125

Conclusions about Project Leaders 126

Project Profile: Dr. Elattuvalapil Sreedharan, India’s Project Management Guru 126

4.4 Project Champions 127

Champions—Who Are They? 128 What Do Champions Do? 129 How to Make a Champion 130

4.5 The New Project Leadership 131 ◾ Box 4.2: Project Managers in Practice 132

Project Profile: The Challenge of Managing Internationally 133

Summary  135  •  Key Terms  136  •  Discussion Questions  136  •  Case Study 4.1 In Search of Effective Project Managers 137

•  Case Study 4.2 Finding the Emotional Intelligence to Be a Real Leader 137 •  Case Study 4.3 Problems with John  138  •  Internet Exercises  141 •  PMP Certification Sample Questions  141  •  Notes  142

Chapter 5 SCoPe ManageMent 144

Project Profile: “We look like fools.”—Oregon’s Failed Rollout of Its Obamacare Web Site 145

Introduction 146

5.1 Conceptual Development 148

The Statement of Work 150 The Project Charter 151

Project Profile: Statements of Work: Then and Now 151

5.2 The Scope Statement 153

The Work Breakdown Structure 153

Purposes of the Work Breakdown Structure 154 The Organization Breakdown Structure 159 The Responsibility Assignment Matrix 160

5.3 Work Authorization 161

Project Profile: Defining a Project Work Package 163

5.4 Scope Reporting 164

◾ Box 5.1: Project Management Research in Brief 165 5.5 Control Systems 167

Configuration Management 167

5.6 Project Closeout 169

Summary  170  •  Key Terms  171  •  Discussion Questions  171  •  Problems  172  •  Case Study 5.1 Boeing’s Virtual Fence 172 •  Case Study 5.2 California’s High-Speed Rail Project  173  •  Case

Study 5.3 Project Management at Dotcom.com  175  •  Case Study 5.4

The Expeditionary Fighting Vehicle  176  •  Internet Exercises  178  •  PMP Certification Sample Questions  178  •  MS Project Exercises  179  •  Appendix 5.1: Sample Project Charter  180  •  Integrated Project— Developing the Work Breakdown Structure  182  •  Notes  184

Chapter 6 ProjeCt teaM BuIldIng, ConflICt, and negotIatIon 186

Project Profile: Engineers Without Borders: Project Teams Impacting Lives 187

Introduction 188

6.1 Building the Project Team 189

Identify Necessary Skill Sets 189

Identify People Who Match the Skills 189

Talk to Potential Team Members and Negotiate with Functional Heads 189 Build in Fallback Positions 191

Assemble the Team 191

6.2 Characteristics of Effective Project Teams 192

A Clear Sense of Mission 192 A Productive Interdependency 192 Cohesiveness 193

Trust 193 Enthusiasm 193

Contents vii

6.3 Reasons Why Teams Fail 194

Poorly Developed or Unclear Goals 194

Poorly Defined Project Team Roles and Interdependencies 194 Lack of Project Team Motivation 195

Poor Communication 195 Poor Leadership 195

Turnover Among Project Team Members 196 Dysfunctional Behavior 196

6.4 Stages in Group Development 196

Stage One: Forming 197 Stage Two: Storming 197 Stage Three: Norming 198 Stage Four: Performing 198 Stage Five: Adjourning 198 Punctuated Equilibrium 198

6.5 Achieving Cross-Functional Cooperation 199

Superordinate Goals 199 Rules and Procedures 200 Physical Proximity 201 Accessibility 201

Outcomes of Cooperation: Task and Psychosocial Results 201

6.6 Virtual Project Teams 202

Project Profile: Tele-Immersion Technology Eases the Use of Virtual Teams 203

6.7  Conflict Management  204

What Is Conflict? 205 Sources of Conflict 206

Methods for Resolving Conflict 208

6.8 Negotiation 209

Questions to Ask Prior to the Negotiation 209 Principled Negotiation 210

Invent Options for Mutual Gain 212 Insist on Using Objective Criteria 213

Summary  214  •  Key Terms  214  •  Discussion Questions  215  •  Case

Study 6.1 Columbus Instruments  215  •  Case Study 6.2 The Bean Counter

and the Cowboy  216  •  Case Study 6.3 Johnson & Rogers Software Engineering, Inc.  217  •  Exercise in Negotiation  219  •  Internet  Exercises  220  •  PMP Certification Sample Questions  220  •  Notes  221 Chapter 7 rISk ManageMent 223

Project Profile: The Building that Melted Cars 224

Introduction 225

◾ Box 7.1: Project Managers in Practice 227

7.1 Risk Management: A Four-Stage Process 228

Risk Identification 228

Project Profile: Bank of America Completely Misjudges Its Customers 230

Risk Breakdown Structures 231

Analysis of Probability and Consequences 231 Risk Mitigation Strategies 234

Use of Contingency Reserves 236 Other Mitigation Strategies 237 Control and Documentation 237

Project Profile: Collapse of Shanghai Apartment Building 239

7.2 Project Risk Management: An Integrated Approach 241

Summary  243  •  Key Terms  244  •  Solved Problem  244  •  Discussion  Questions  244  •  Problems  244  •  Case Study 7.1 Classic Case: de Havilland’s Falling Comet  245  •  Case Study 7.2 The Spanish Navy Pays Nearly $3 Billion for a Submarine That Will Sink Like a Stone  248  •  Case

Study 7.3 Classic Case: Tacoma Narrows Suspension Bridge  249  •  Internet 

Exercises  251  •  PMP Certification Sample Questions  251  •  Integrated  Project—Project Risk Assessment  253  •  Notes  255

Chapter 8 CoSt eStIMatIon and BudgetIng 256

Project Profile: Sochi Olympics—What’s the Cost of National Prestige? 257

8.1 Cost Management 259

Direct Versus Indirect Costs 260

Recurring Versus Nonrecurring Costs 261 Fixed Versus Variable Costs 261

Normal Versus Expedited Costs 262

8.2 Cost Estimation 262

Learning Curves in Cost Estimation 266 ◾ Box 8.1: Project Management Research in Brief 270 Problems with Cost Estimation 272

◾ Box 8.2: Project Management Research in Brief 274 8.3 Creating a Project Budget 275

Top-Down Budgeting 275 Bottom-Up Budgeting 276 Activity-Based Costing 276

8.4 Developing Budget Contingencies 278

Summary  280  •  Key Terms  281  •  Solved Problems  282 

•  Discussion Questions  283  •  Problems  284  •  Case Study 8.1 The Hidden Costs of Infrastructure Projects—The Case of Building Dams 286 •  Case Study 8.2 Boston’s Central Artery/Tunnel Project  288  •  Internet  Exercises  290  •  PMP Certification Sample Questions  290  •  Integrated  Project—Developing the Cost Estimates and Budget  292  •  Notes  294 Chapter 9 ProjeCt SChedulIng: netWorkS, duratIon eStIMatIon,

and CrItICal Path 296

Project Profile: After 20 Years and More Than $50 Billion, Oil is No Closer to the Surface: The Caspian Kashagan Project 297

Introduction 298 9.1 Project Scheduling 299 9.2  Key Scheduling Terminology  300 9.3 Developing a Network 302 Labeling Nodes 303 Serial Activities 303 Concurrent Activities 303 Merge Activities 304 Burst Activities 305 9.4 Duration Estimation 307

Contents ix

9.5 Constructing the Critical Path 311

Calculating the Network 311 The Forward Pass 312 The Backward Pass 314

Probability of Project Completion 316 Laddering Activities 318

Hammock Activities 319

Options for Reducing the Critical Path 320 ◾ Box 9.1: Project Management Research in Brief 321

Summary  322  •  Key Terms  323  •  Solved Problems  323  •  Discussion Questions  325  •  Problems  325  •  Internet 

Exercises  327  •  MS Project Exercises  328  •  PMP Certification  Sample Questions  328  •  Notes  329

Chapter 10 ProjeCt SChedulIng: laggIng, CraShIng, and aCtIvIty netWorkS 330

Project Profile: Enlarging the Panama Canal 331

Introduction 333

10.1 Lags in Precedence Relationships 333

Finish to Start 333 Finish to Finish 334 Start to Start 334 Start to Finish 335

10.2 Gantt Charts 335

Adding Resources to Gantt Charts 337 Incorporating Lags in Gantt Charts 338 ◾ Box 10.1: Project Managers in Practice 338 10.3 Crashing Projects 340

Options for Accelerating Projects 340 Crashing the Project: Budget Effects 346

10.4 Activity-on-Arrow Networks 348

How Are They Different? 348 Dummy Activities 351

Forward and Backward Passes with AOA Networks 352 AOA Versus AON 353

10.5 Controversies in the Use of Networks 354

Conclusions 356

Summary  356  •  Key Terms  357  •  Solved Problems  357  •  Discussion  Questions  358  •  Problems  358  •  Case Study 10.1 Project Scheduling at Blanque Cheque Construction (A)  360  •  Case Study 10.2 Project Scheduling at Blanque Cheque Construction (B)  360  •  MS Project  Exercises  361  •  PMP Certification Sample Questions  361  •  Integrated  Project—Developing the Project Schedule  363  •  Notes  365

Chapter 11 advanCed toPICS In PlannIng and SChedulIng: agIle and CrItICal ChaIn 366

Project Profile: Developing Projects Through Kickstarter—Do Delivery Dates Mean Anything? 367

Introduction 368

11.1 Agile Project Management 369

Tasks Versus Stories 371 Key Terms in Agile PM 372 Steps in Agile 373

Sprint Planning 374 Daily Scrums 374

The Development Work 374 Sprint Reviews 375

Sprint Retrospective 376 Problems with Agile 376

◾ Box 11.1: Project Management Research in Brief 376 11.2 Extreme Programming (XP) 377

11.3 The Theory of Constraints and Critical Chain Project Scheduling 377

Theory of Constraints 378

11.4 The Critical Chain Solution to Project Scheduling 379

Developing the Critical Chain Activity Network 381 Critical Chain Solutions Versus Critical Path Solutions 383

Project Profile: Eli Lilly Pharmaceuticals and Its Commitment to Critical Chain Project Management 385

11.5  Critical Chain Solutions to Resource Conflicts  386 11.6 Critical Chain Project Portfolio Management 387

◾ Box 11.2: Project Management Research in Brief 390 11.7 Critiques of CCPM 391

Summary  391  •  Key Terms  393  •  Solved Problem  393 

•  Discussion Questions  394  •  Problems  394  •  Case Study 11.1 It’s an Agile World  396  •  Case Study 11.2 Ramstein Products, Inc. 397 •  Internet Exercises  398  •  Notes  398

Chapter 12 reSourCe ManageMent 400

Project Profile: Hong Kong Connects to the World’s Longest Natural Gas Pipeline 401

Introduction 402

12.1 The Basics of Resource Constraints 402

Time and Resource Scarcity 403

12.2 Resource Loading 405 12.3 Resource Leveling 407

Step One: Develop the Resource-Loading Table 411 Step Two: Determine Activity Late Finish Dates 412 Step Three: Identify Resource Overallocation 412 Step Four: Level the Resource-Loading Table 412

12.4 Resource-Loading Charts 416

◾ Box 12.1: Project Managers in Practice 418

12.5 Managing Resources in Multiproject Environments 420

Schedule Slippage 420 Resource Utilization 420 In-Process Inventory 421

Resolving Resource Decisions in Multiproject Environments 421

Summary  423  •  Key Terms  424  •  Solved Problem  424  •  Discussion Questions  425  •  Problems  425  •  Case Study 12.1 The Problems of Multitasking  427  •  Internet Exercises  428  •  MS Project  Exercises  428  •  PMP Certification Sample Questions  429  •  Integrated  Project—Managing Your Project’s Resources  430  •  Notes  430

Contents xi Chapter 13 ProjeCt evaluatIon and Control 431

Project Profile: New York City’s CityTime Project 432

Introduction 433

13.1 Control Cycles—A General Model 434 13.2 Monitoring Project Performance 435

The Project S-Curve: A Basic Tool 435 S-Curve Drawbacks 436

Milestone Analysis 437 Problems with Milestones 438 The Tracking Gantt Chart 439

Benefits and Drawbacks of Tracking Gantt Charts 440

13.3 Earned Value Management 440

Terminology for Earned Value 441 Creating Project Baselines 442 Why Use Earned Value? 443

Steps in Earned Value Management 444 Assessing a Project’s Earned Value 445

13.4 Using Earned Value to Manage a Portfolio of Projects 450

Project Profile: Earned Value at Northrop Grumman 451

13.5 Issues in the Effective Use of Earned Value Management 452 13.6 Human Factors in Project Evaluation and Control 454

Critical Success Factor Definitions 456 Conclusions 458

Summary  458  •  Key Terms  459  •  Solved Problem  459  •  Discussion Questions  460  •  Problems  461  •  Case Study 13.1 The IT Department at Kimble College  463  •  Case Study 13.2 The Supercon-ducting Supercollider  464  •  Case Study 13.3 Boeing’s 787 Dreamliner: Failure to Launch  465  •  Internet Exercises  468  •  MS Project  Exercises  468  •  PMP Certification Sample Questions  469  •  Appendix 13.1: Earned Schedule*  470  •  Notes  475 Chapter 14 ProjeCt CloSeout and terMInatIon 477

Project Profile: Duke Energy and Its Cancelled Levy County Nuclear Power Plant 478

Introduction 479

14.1 Types of Project Termination 480 ◾ Box 14.1: Project Managers in Practice 480

14.2 Natural Termination—The Closeout Process 482

Finishing the Work 482 Handing Over the Project 482

Gaining Acceptance for the Project 483 Harvesting the Benefits 483

Reviewing How It All Went 483 Putting It All to Bed 485 Disbanding the Team 486

What Prevents Effective Project Closeouts? 486

14.3 Early Termination for Projects 487

Making the Early Termination Decision 489

Project Profile: Aftermath of a “Feeding Frenzy”: Dubai and Cancelled Construction Projects 490

Shutting Down the Project 490

◾ Box 14.2: Project Management Research in Brief 492 Allowing for Claims and Disputes 493

14.4 Preparing the Final Project Report 494

Conclusion 496

Summary  496  •  Key Terms  497  •  Discussion Questions  497  •  Case Study 14.1 New Jersey Kills Hudson River Tunnel Project  497  •  Case Study 14.2 The Project That Wouldn’t Die  499  •  Case Study 14.3 The Navy Scraps Development of Its Showpiece Warship—Until the Next Bad Idea  500  •  Internet Exercises  501  •  PMP Certification Sample  Questions  502  •  Appendix 14.1: Sample Pages from Project Sign-off  Document  503  •  Notes  507

Project management has become central to operations in industries as diverse as construction and information technology, architecture and hospitality, and engineering and new product development; therefore, this text simultaneously embraces the general principles of project management while addressing specific examples across the wide assortment of its applications. This text approaches each chapter from the perspective of both the material that is general to all disciplines and project types and that which is more specific to alternative forms of projects. One way this is accomplished is through the use of specific, discipline-based examples to illus-trate general principles as well as the inclusion of cases and Project Profiles that focus on more specific topics (e.g., Chapter 5’s treatment of IT “death march” projects).

Students in project management classes come from a wide and diverse cross section of uni-versity majors and career tracks. Schools of health, business, architecture, engineering, information systems, and hospitality are all adding project management courses to their catalogs in response to the demands from organizations and professional groups that see their value for students’ future careers. Why has project management become a discipline of such tremendous interest and applica-tion? The simple truth is that we live in a “projectized” world. Everywhere we look we see people engaged in project management. In fact, project management has become an integral part of practi-cally every firm’s business model.

This text takes a holistic, integrated approach to managing projects, exploring both technical and managerial challenges. It not only emphasizes individual project execution, but also provides a strategic perspective, demonstrating the means with which to manage projects at both the program and portfolio levels.

At one time, project management was almost exclusively the property of civil and con-struction engineering programs where it was taught in a highly quantitative, technical man-ner. “Master the science of project management,” we once argued, “and the ‘art’ of project management will be equally clear to you.” Project management today is a complex, “manage-ment” challenge requiring not only technical skills but a broad-based set of people skills as well. Project management has become the management of technology, people, culture, stake-holders, and other diverse elements necessary to successfully complete a project. It requires knowledge of leadership, team building, conflict resolution, negotiation, and influence in equal measure with the traditional, technical skill set. Thus, this textbook broadens our focus beyond the traditional project management activities of planning and scheduling, project control, and termination, to a more general, inclusive, and, hence, more valuable perspective of the project management process.

What’s NeW iN the foUrth editioN?

New features

• Agile Project Management • Project Charters

• MS Project 2013 Step-by-Step Tutorials • Appendix—Project Execution Plan Template • New Project Managers in Practice Profiles • Risk Breakdown Structures

• Extreme Programming

• Updated Problems in Chapters

• New Project Management Research in Brief: “Does Agile Work?”

• All MS Project Examples and Screen Captures Updated to MS Project 2013

• All Project Management Body of Knowledge (PMBOK) Referencing Updated to 5th Edition

• Quarterly Updates for All Book Adopters on Latest Cases and Examples in Project Management

Updated Project Profiles

Chapter 1 Introduction: Why Project Management?

• Development Projects in Lagos, Nigeria

• “Throwing Good Money after Bad”: The BBC’s Digital Media Initiative

Chapter 2 The Organizational Context: Strategy, Structure, and Culture

• Tesla’s $5 Billion Gamble

• Electronic Arts and the Power of Strong Culture in Design Teams

Chapter 3 Project Selection and Portfolio Management

• Project Selection Procedures: A Cross-Industry Sampler

Chapter 4 Leadership and the Project Manager

• Leading by Example for the London Olympics—Sir John Armitt • Dr. E. Sreedharan, India’s Project Management Guru

Chapter 5 Scope Management

• “We look like fools.” Oregon’s Failed Rollout of Their Obamacare Website • Boeing’s Virtual Fence

• California’s High-Speed Rail Project—What’s the Latest News? • The Expeditionary Fighting Vehicle

Chapter 6 Project Team Building, Conflict, and Negotiation

• Engineers without Borders: Project Teams Impacting Lives

Chapter 7 Risk Management

• The Building That Melted Cars

• Bank of America Completely Misjudges Its Customers • Collapse of Shanghai Apartment Building

• The Spanish Navy Pays Nearly $3 Billion for a Submarine That Will Sink Like a Stone

Chapter 8 Cost Estimation and Budgeting

• Sochi Olympics—What’s the Cost of National Prestige?

• The Hidden Costs of Infrastructure ProjectsThe Case of Building Dams

Chapter 9 Project Scheduling: Networks, Duration Estimation, and Critical Path

• After 20 Years and More than $50 Billion, Oil Is No Closer to the Surface: The Caspian Kashagan Project

Chapter 10 Project Scheduling: Lagging, Crashing, and Activity Networks

• Enlarging the Panama Canal

Chapter 11 Critical Chain Project Scheduling

• Developing Projects through Kickstarter—Do Delivery Dates Mean Anything? • Eli Lilly Pharmaceutical’s Commitment to Critical Chain Project Scheduling

Chapter 12 Resource Management

• Hong Kong Connects to the World’s Longest Natural Gas Pipeline

Chapter 13 Project Evaluation and Control

• New York City’s CityTime Project

• Boeing’s 787 Dreamliner: Failure to Launch (with update) • Earned Value Management at Northrop Grumman

Chapter 14 Project Closeout and Termination

• Duke Energy and Its Cancelled Levy County Nuclear Power Plant

• Aftermath of a “Feeding Frenzy”—Dubai and Cancelled Construction Projects • New Jersey Kills Hudson River Tunnel Project

This textbook employs a managerial, business-oriented approach to the management of projects. Thus we have integrated Project Profiles into the text.

• Project Profiles—Each chapter contains one or more Project Profiles that highlight cur-rent examples of project management in action. Some of the profiles reflect on significant

achievements; others detail famous (and not-so-famous) examples of project failures. Because they cover diverse ground (IT projects, construction, new product development, and so forth), there should be at least one profile per chapter that is meaningful to the class’s focus. There is a deliberate effort made to offer a combination of project success stories and project failures. While successful projects can be instructive, we often learn far more from examining the variety of reasons why projects fail. As much as possible, these stories of success and failure are intended to match up with the chapters to which they are attached. For example, as we study the uses of projects to implement corporate strategy, it is useful to consider Elon Musk’s $5 billion dollar decision to develop a “gigafactory” to produce batteries for his Tesla automobiles.

The book blends project management within the context of the operations of any successful or-ganization, whether publicly held, private, or not-for-profit. We illustrate this through the use of end-of-chapter cases.

• Cases—At the end of each chapter are some final cases that take specific examples of the material covered in the chapter and apply them in the alternate format of case studies. Some of the cases are fictitious, but the majority of them are based on real situations, even where aliases mask the real names of organizations. These cases include discussion ques-tions that can be used either for homework or to facilitate classroom discussions. There are several “classic” project cases as well, highlighting some famous (and infamous) examples of projects whose experiences have shaped our understanding of the discipline and its best practices.

Further, we explore both the challenges in the management of individual projects as well as broad-ening out this context to include strategic, portfolio-level concepts. To do this, we ask students to develop a project plan using MS Project 2013.

• Integrated Project Exercises—Many of the chapters include an end-of-chapter feature that is unique to this text: the opportunity to develop a detailed project plan. A very beneficial exercise in project management classes is to require students, either in teams or individu-ally, to learn the mechanics of developing a detailed and comprehensive project plan, in-cluding scope, scheduling, risk assessment, budgeting, and cost estimation. The Integrated Project exercises afford students the opportunity to develop such a plan by assigning these activities and illustrating a completed project (ABCups, Inc.) in each chapter. Thus, students are assigned their project planning activities and have a template that helps them complete these exercises.

And finally, we have integrated the standards set forth by the world’s largest governing body for project management. The Project Management Institute (PMI) created the Project Management Body of Knowledge (PMBOK), which is generally regarded as one of the most comprehensive frameworks for identifying the critical knowledge areas that project managers must understand if they are to master their discipline. The PMBOK has become the basis for the Project Management Professional (PMP) certification offered by PMI for professional project managers.

• Integration with the PMBOK—As a means to demonstrate the coverage of the critical PMBOK elements, readers will find that the chapters in this text identify and cross-list the corresponding knowledge areas from the latest, fifth edition of PMBOK. Further, all terms (including the Glossary) are taken directly from the most recent edition of the PMBOK.

• Inclusion of Sample PMP Certification Exam Questions—The Project Management Professional (PMP) certification represents the highest standard of professional qualifi-cation for a practicing project manager and is administered by the Project Management Institute. As of 2014, there were more than 600,000 PMPs worldwide. In order to attain PMP certification, it is necessary for candidates to undergo a comprehensive exam that tests their knowledge of all components of the PMBOK. This text includes a set of sample PMP certification exam questions at the end of most of the chapters, in order to give read-ers an idea of the types of questions typically asked on the exam and how those topics are treated in this book.

other PoiNts of distiNctioN

The textbook places special emphasis on blending current theory, practice, research, and case studies in such a manner that readers are given a multiple-perspective exposure to the project management process. A number of in-chapter features are designed to enhance student learning, including:

• MS Project Exercises—An additional feature of the text is the inclusion at the end of several chapters of some sample problems or activities that require students to generate MS Project output files. For example, in Chapter 9 on scheduling, students must create an MS Project network diagram. Likewise, other reports can be assigned to help students become mini-mally adept at interacting with this program. It is not the purpose of this text to fully develop these skills but rather to plant the seeds for future application.

• Research in Brief—A unique feature of this text is to include short (usually one-page) text boxes that highlight the results of current research on the topics of interest. Students often find it useful to read about actual studies that highlight the text material and provide additional information that expands their learning. Although not every chapter includes a “Research in Brief” box, most have one and, in some cases, two examples of this feature.

• Project Managers in Practice—An addition to this text is the inclusion of several short profiles of real, practicing project managers from a variety of corporate and project settings. These profiles have been added to give students a sense of the types of real-world challenges project managers routinely face, the wide range of projects they are called to manage, and the satisfac-tions and career opportunities available to students interested in pursuing project manage-ment as a career.

• Internet Exercises—Each chapter contains a set of Internet exercises that require students to search the Web for key information and perform other activities that lead to student learn-ing through outside-of-class, hands-on activities. Internet exercises are a useful supplement, particularly in the area of project management, because so much is available on the World Wide Web relating to projects, including cases, news releases, and Internet-based tools for analyzing project activities.

• MS Project 2013 Tutorials—Appendix B at the end of the text features two in-depth tutorials that instruct students in the rudiments of developing a project schedule, resource leveling, and critical path development. A second tutorial instructs students in methods for updating the project plan, generating output files such as earned value metrics, and tracking ongoing project activities. These tutorials are not intended to substitute for fuller instruction in this valuable software, but they do provide a critical means for initial familiarization with the package.

• Project Execution Plan Template—Appendix C provides a template for developing a fully evolved project execution plan. Instructors using previous versions of this text noted the value in requiring that students be able to create a project plan and requested a more comprehensive template that could be employed. This template addresses the critical elements of project scope, as well as offers a method for putting these details in a logical sequence.

instructor resources

At the Instructor Resource Center, www.pearsonhighered.com/irc, instructors can easily register to gain access to a variety of instructor resources available with this text in downloadable format. If assistance is needed, our dedicated technical support team is ready to help with the media supple-ments that accompany this text. Visit http://247.pearsoned.com for answers to frequently asked questions and toll-free user support phone numbers.

The following supplements are available with this text: • Instructor’s Solutions Manual

• Test Bank

• TestGen® Computerized Test Bank • PowerPoint Presentation

Preface xvii

ackNoWledgmeNts

In acknowledging the contributions of past and present colleagues to the creation of this text, I must first convey my deepest thanks and appreciation for the 30-year association with my origi-nal mentor, Dr. Dennis Slevin of the University of Pittsburgh’s Katz Graduate School of Business. My collaboration with Denny on numerous projects has been fruitful and extremely gratifying, both professionally and personally. In addition, Dr. David Cleland’s friendship and partnership in several ventures has been a great source of satisfaction through the years. A frequent collaborator who has had a massive influence on my thinking and approach to understanding project manage-ment is Professor Peter W.G. Morris, lately of University College London. Working with him has been a genuine joy and constant source of inspiration. Additional mentors and colleagues who have strongly influenced my thinking include Samuel Mantel, Jr., Rodney Turner, Erik Larson, David Frame, Francis Hartman, Jonas Soderlund, Young Kwak, Rolf Lundin, Lynn Crawford, Graham Winch, Terry Williams, Francis Webster, Terry Cooke-Davies, Hans Thamhain, and Karlos Artto. Each of these individuals has had a profound impact on the manner in which I view, study, and write about project management. Sadly, 2014 saw the passing of three of these outstanding project management scholars—Hans Thamhain, Sam Mantel and Francis Hartman. I hope that my efforts help, in some small part, to keep their vision and contributions alive.

Over the years, I have also been fortunate to develop friendships with some professional project managers whose work I admire enormously. They are genuine examples of the best type of project manager: one who makes it all seem effortless while consistently performing minor miracles. In par-ticular, I wish to thank Mike Brown of Rolls-Royce for his friendship and example. I would also like to thank friends and colleagues from the Project Management Institute, including Lew Gedansky, Harry Stephanou, and Eva Goldman, for their support for and impact on this work.

I am indebted to the reviewers of this text whose numerous suggestions and critiques have been an invaluable aid in shaping its content. Among them, I would like to especially thank the following:

Kwasi Amoako-Gyampah— University of North Carolina, Greensboro Ravi Behara—George Mason University

Jeffrey L. Brewer—Purdue University

Dennis Cioffi—George Washington University David Clapp—Florida Institute of Technology

Bruce DeRuntz—Southern Illinois University at Carbondale Ike Ehie—Kansas State University

Michael H. Ensby—Clarkson University Lynn Fish—Canisius College

Linda Fried—University of Colorado, Denver Mario Guimaraes—Kennesaw State University

Richard Gunther—California State University, Northridge Brian Gurney—Montana State University, Billings

Gary Hackbarth—Iowa State University

Mamoon M. Hammad—George Washington University Scott Robert Homan—Purdue University

John Hoxmeier—Colorado State University Alex Hutchins—ITT Technical Institute Richard Jensen—Hofstra University Robert Key—University of Phoenix

Homayoun Khamooshi—George Washington University Dennis Krumwiede—Idaho State University

George Mechling—Western Carolina University Julia Miyaoka—San Francisco State University

LaWanda Morant—ITT Technical Institute

Robert Morris—Florida State College at Jacksonville James Muller—Cleveland State University

Kenneth E. Murphy—Willamette University John Nazemetz—Oklahoma State University Patrick Penfield—Syracuse University Ronald Price—ITT Techincal Institute

Ronny Richardson—Southern Polytechnic State University John Sherlock—Iona College

Gregory Shreve—Kent State University

Randall G. Sleeth—Virginia Commonwealth University Kimberlee Snyder—Winona State University

Jeff Trailer—California State University, Chico Leo Trudel—University of Maine

Oya Tukel—Cleveland State University Darien Unger—Howard University

Amy Valente—Cayuga Community College Stephen Whitehead—Hilbert College

I would also like to thank my colleagues in the Samuel Black School of Business at Penn State, the Behrend College. Additionally, my thanks goes to Dana Johnson of Michigan Technological University for preparing the PowerPoints for this edition, and Geoff Willis of University of Central Oklahoma for preparing the Test Bank. Extra-special thanks go to Kerri Tomasso for her help in preparing the final manuscript and for her integral role in permissions research and acquisitions. I am espe-cially indebted to Khurrum Bhutta, who accuracy checked this edition. I am very grateful for his time and effort, and any errors that may remain are entirely my own.

In developing the cases for this edition of the textbook, I was truly fortunate to develop wonderful professional relationships with a number of individuals. Andrea Finger and Kathleen Prihoda of Disney were wonderfully helpful and made time in their busy schedules to assist me in developing the Expedition Everest case for this text. Stephanie Smith, Mohammed Al-Sadiq, Bill Mowery, Mike Brown, Julia Sweet, and Kevin O’Donnell provided me with invaluable information on their job responsibilities and what it takes to be a successful project manager.

The textbook team and I would appreciate hearing from you. Let us know what you think about this textbook by writing to [email protected]. Please include “Feedback about Pinto” in the subject line.

If you have questions related to this product, please contact our customer service department online at http://247pearsoned.custhelp.com.

Finally, it is important to reflect on an additional salient issue as you begin your study of project management: Most of you will be running a project long before you are given wider management

responsibilities in your organizations. Successful project managers are the lifeblood of organizations and bear the imprint of the fast track. I wish you great success!

Jeffrey K. Pinto, Ph.D.

Andrew Morrow and Elizabeth Lee Black Chair Management of Technology Samuel Black School of Business Penn State, the Behrend College

Introduction

Why project management, chapter outline.

Project Profile

Development Projects in Lagos, Nigeria introduction

1.1 What is a Project?

General Project Characteristics

1.2 Why are Projects imPortant?

“Throwing Good Money after Bad”: The BBC’s Digital Media Initiative 1.3 Project life cycles

Project managers in Practice Stephanie Smith, Westinghouse Electric

1.4 determinants of Project success

Project Management Research in Brief

Assessing Information Technology (IT) Project Success

1.5 develoPing Project management

1.6 Project elements and text organization

Summary Key Terms

Discussion Questions

Case Study 1.1 MegaTech, Inc.

Case Study 1.2 The IT Department at Hamelin Hospital

Case Study 1.3 Disney’s Expedition Everest Case Study 1.4 Rescue of Chilean Miners Internet Exercises

PMP Certification Sample Questions Notes

Chapter Objectives

After completing this chapter, you should be able to:

1. Understand why project management is becoming such a powerful and popular practice in business.

2. Recognize the basic properties of projects, including their definition. 3. Understand why effective project management is such a challenge.

4. Differentiate between project management practices and more traditional, process-oriented business functions.

5. Recognize the key motivators that are pushing companies to adopt project management

6. Understand and explain the project life cycle, its stages, and the activities that typically occur at each stage in the project.

7. Understand the concept of project “success,” including various definitions of success, as well as the alternative models of success.

8. Understand the purpose of project management maturity models and the process of bench-marking in organizations.

9. Identify the relevant maturity stages that organizations go through to become proficient in their use of project management techniques.

Project MAnAgeMent Body of Knowledge core concePts covered in this chAPter

1. Definition of a Project (PMBoK sec. 1.2)

2. Definition of Project Management (PMBoK sec. 1.3)

3. Relationship to Other Management Disciplines (PMBoK sec. 1.4) 4. Project Phases and the Project Life Cycle (PMBoK sec. 2.1)

The world acquires value only through its extremes and endures only through moderation; extremists make the world great, the moderates give it stability. 1

Development Projects in lagos, Nigeria

Lagos is the capital of Nigeria and home to an estimated 15–20 million people, making its population larger than London or Beijing. As the largest and fastest-growing city in sub-Saharan Africa (estimates are that 600,000 people are added to Lagos’ population each year), Lagos is in desperate need of developing and maintaining infrastructure to support its population, while supporting its claim as a high-technology hub on the African continent. Considering that about 85% of the world’s population resides in the developing world and transitioning economies, and nearly two-thirds of that population is below the age of 35, the need for infrastructure to support critical human needs is im-mense. About 70% of the city’s population is believed to live in slums, while a 2006 United Nations report estimated that only 10% of households in the Lagos Metropolitan area were directly connected to a municipal water supply. In spite of these problems, Nigeria is Africa’s biggest economy, driven by economic growth in Lagos, home to film and fashion industries, financial markets, and consumer goods manufacturers.

The list of critical items on the list for urban improvement is large. For example, for a city of more than 15 million, electricity is scarcely to be found. Lagos power stations only generate a mere 2,000 megawatts of electricity—less than half of that available for a single city block in midtown Manhattan! “We have about two hours, maybe, of public power a day,” says Kola Karim, CEO of Nigeria’s Shoreline Energy International. “It’s unbearable.” Everywhere in the city people are using gasoline or diesel generators to supply power when the inevitable rolling blackouts resume.

Additionally, Lagos is critically short on housing. To overcome this shortage people of Lagos resort to living in shanty towns, one such shanty town is Makoko. Makoko is situated on the mainland’s Lagos lagoon. Home to several hundred thousand inhabitants, Makoko lacks access to basic services, including clean drinking water, electricity, and waste disposal, and is prone to severe environmental and health hazards. Consisting of rickety dwellings on stilts perched over the foul-smelling lagoon, Makoko is one of the many chaotic human settlements that have sprouted in Lagos in recent years. As these cities spread out and move too close to major bridges or electrical towers, the govern-ment periodically sends in troops to demolish portions of the floating village.

How did the city get to this point? A big reason was a lack of forethought and development planning. In metro-politan Lagos there are 20,000 people per square kilometer with thousands more arriving each day. Given the physical constraints of the city, originally built on a narrow strip of land and bordering the ocean, there is just not enough space to absorb the new inhabitants. Urban planning, as we know it today, simply did not exist and the city swelled organi-cally, without forethought or a sense of direction. Thus, Lagos has no urban transportation system, few functioning traffic lights, and a crumbling and outdated road system.

The problems do not stop there. Land prices in Lagos are extremely high, due to lack of space for commercial development. However, because of the unreliable electricity supply that makes elevator use questionable, there are few high-rise apartments or office buildings in the city. Banks have been reluctant to invest in real estate trans-actions because of past failures and general economic instability. Faced with the need to drastically change the direction of the city, Babatunde Fashola, Lagos’ visionary governor who took power in 2010, has launched a series

Project Profile 3

of urban development projects to address a variety of the city’s needs. Fashola has announced $50 billion in new infrastructure projects for Lagos, to be developed over the next 10 years. These new project initiatives include the following:

lagos Metro Blue line

The blue line is a major cosmopolitan light-rail transport project to connect districts in Nigeria’s largest city. Designed to ease congestion and speed up journey times for the city’s inhabitants, the Blue Line will run between Marina and Okokomaiko, stopping at 13 stations, and is part of the Lagos Rail Mass Transit program implemented by the govern-ment. Originally proposed in 2008, funding issues have pushed the launch of the Blue Line back to at least 2015. The Line is set to cost $1.2 billion and will be funded by the Lagos State Government.

eko Atlantic

Eko Atlantic is an ambitious land reclamation project, a pioneering residential and business development located on Victoria Island, along its upmarket Bar Beach coastline. The project is being built on three and a half square miles of land reclaimed from the Atlantic Ocean and is expected to provide accommodation for 250,000 people and employ-ment opportunities for a further 150,000. The complex will function as a city-within-a-city, including recreational facilities, business and shopping districts, and modern conveniences.

Bus rapid-transit System

To ease the crush of public transportation, the Bus Rapid Transport (BRT) system was introduced 10 years ago to streamline and modernize the motley collection of buses that had transported residents around the city. Lagos has long suffered from an unregulated transportation system in which a variety of different “buses,” ranging from bat-tered minibuses to old, yellow-painted school buses, competed for customers. Fares were also unregulated, leaving

Figure 1.1 traffic congestion in lagos, Nigeria

Source: Femi Ipaye/Xinhua Press/Corbis

introduction

Projects are one of the principal means by which we change our world. Whether the goal is to split the atom, tunnel under the English Channel, introduce Windows 9, or plan the next Summer Olympic Games in Rio de Janeiro, the means through which to achieve these challenges remains the same: project management. Project management has become one of the most popular tools for organizations, both public and private, to improve internal operations, respond rapidly to exter-nal opportunities, achieve technological breakthroughs, streamline new product development, and more robustly manage the challenges arising from the business environment. Consider what Tom Peters, best-selling author and management consultant, has to say about project management and its place in business: “Projects, rather than repetitive tasks, are now the basis for most value-added in business.”3 Project management has become a critical component of successful business operations in worldwide organizations.

One of the key features of modern business is the nature of the opportunities and threats posed by external events. As never before, companies face international competition and the need to pursue commercial opportunities rapidly. They must modify and introduce products constantly, respond to customers as fast as possible, and maintain competitive cost and operating levels. Does performing all these tasks seem impossible? At one time, it was. Conventional wisdom held that a company could compete using a low-cost strategy or as a product innovator or with a focus on customer service. In short, we had to pick our competitive niches and concede others their claim to market share. In the past 20 years, however, everything turned upside down. Companies such as General Electric, Apple, Ericksson, Boeing, and Oracle became increasingly effective at realiz-ing all of these goals rather than settlrealiz-ing for just one. These companies seemed to be successful in every aspect of the competitive model: They were fast to market and efficient, cost-conscious and customer-focused. How were they performing the impossible?

Obviously, there is no one answer to this complex question. There is no doubt, however, that these companies shared at least one characteristic: They had developed and committed themselves to project management as a competitive tool. Old middle managers, reported Fortune magazine,

are dinosaurs, [and] a new class of manager mammal is evolving to fill the niche they once ruled: project managers. Unlike his biological counterpart, the project manager is more agile and adaptable than the beast he’s displacing, more likely to live by his wits than throwing his weight around.4

Effective project managers will remain an indispensable commodity for successful organiza-tions in the coming years. More and more companies are coming to this conclusion and adopting

drivers free to charge whatever fares they chose. “They might charge $1 in the morning for one trip one way and by afternoon they can go to $3,” says Dayo Mobereola, managing director of the Lagos Metropolitan Area Transport Authority, noting that commuters spend on average 40% of their income on transportation. Before the project was announced, the city had projected that it would transport 60,000 passengers daily, but now it transports over 200,000 passengers daily. The BRT system has reduced waiting times at bus stops, the travel time across the city, all at a reduced rate when compared to the old system.

Schools, Bridges, and Power Plants

Part of the aggressive infrastructure modernization includes improving traffic by building the first suspension bridge in West Africa, as well as adding a number of new schools around the city. Two new power plants are also slated to be constructed, bringing a more dependable source of power to the city, including powering street lights to ease crime and other problems. The city has even launched a fleet of brand new garbage trucks to deal with the 10,000 tons of waste generated every day.

Lagos’ modernization efforts in recent years have come not a moment too soon in support of its citizens. As Professor Falade observed, these efforts to modernize the city’s facilities are a breath of fresh air. “The difference is clear, the evidence is the improved landscape of Lagos in the urban regeneration project.”2

project management as a way of life. Indeed, companies in such diverse industries as construction, heavy manufacturing, insurance, health care, finance, public utilities, and software are becoming project savvy and expecting their employees to do the same.

Although there are a number of general definitions of the term project, we must recognize at the outset that projects are distinct from other organizational processes. As a rule, a process refers to ongoing, day-to-day activities in which an organization engages while producing goods or services. Processes use existing systems, properties, and capabilities in a continuous, fairly repetitive manner.5 Projects, on the other hand, take place outside the normal, process-oriented world of the firm. Certainly, in some organizations, such as construction, day-to-day processes center on the creation and development of projects. Nevertheless, for the majority of organizations, project management activities remain unique and separate from the manner in which more routine, process-driven work is performed. Project work is continuously evolving, establishes its own work rules, and is the antith-esis of repetition in the workplace. As a result, it represents an exciting alternative to business as usual for many companies. The challenges are great, but so are the rewards of success.

First, we need a clear understanding of the properties that make projects and project manage-ment so unique. Consider the following definitions of projects:

A project is a unique venture with a beginning and end, conducted by people to meet estab-lished goals within parameters of cost, schedule, and quality.6

Projects [are] goal-oriented, involve the coordinated undertaking of interrelated activities, are of finite duration, and are all, to a degree, unique.7

A project can be considered to be any series of activities and tasks that: • Have a specific objective to be completed within certain specifications • Have defined start and end dates

• Have funding limits (if applicable)

• Consume human and nonhuman resources (i.e., money, people, equipment) • Are multifunctional (i.e., cut across several functional lines)8

[A project is] [o]rganized work toward a predefined goal or objective that requires resources and effort, a unique (and therefore risky) venture having a budget and schedule.9

Probably the simplest definition is found in the Project Management Body of Knowledge (PMBoK) guide of the Project Management Institute (PMI). PMI is the world’s largest professional project management association, with more than 450,000 members worldwide as of 2014. In the PMBoK guide, a project is defined as “a temporary endeavor undertaken to create a unique product, ser-vice, or result” (p. 553).10

Let us examine the various elements of projects, as identified by these set of definitions. • Projects are complex, one-time processes. A project arises for a specific purpose or to meet

a stated goal. It is complex because it typically requires the coordinated inputs of numerous members of the organization. Project members may be from different departments or other organizational units or from one functional area. For example, a project to develop a new software application for a retail company may require only the output of members of the Information Systems group working with the marketing staff. On the other hand, some proj-ects, such as new product introductions, work best with representation from many functions, including marketing, engineering, production, and design. Because a project is intended to fulfill a stated goal, it is temporary. It exists only until its goal has been met, and at that point, it is dissolved.

• Projects are limited by budget, schedule, and resources. Project work requires that members work with limited financial and human resources for a specified time period. They do not run indefinitely. Once the assignment is completed, the project team disbands. Until that point, all its activities are constrained by limitations on budget and personnel availability. Projects are “resource-constrained” activities.

• Projects are developed to resolve a clear goal or set of goals. There is no such thing as a project team with an ongoing, nonspecific purpose. The project’s goals, or deliverables,

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Top 20 Project Management Case Studies [With Examples]

Project management case study analyses showcase and compare real-life project management processes and systems scenarios. These studies shed light on the common challenges that project managers encounter on a daily basis. This helps project managers develop effective strategies, overcome obstacles, and achieve successful results. 

By leveraging project management case studies , organisations can optimise their operations by providing insights into the most effective approaches. With effective implementation of these case studies, strategies, and methodologies, ensuring successful project completion is achievable.

Criteria for Selection of Top 20 Case Studies

The top 20 case studies are selected based on significance, impact, challenges, project management strategies, and overall success. They provide diverse insights and lessons for project managers and organisations.

1. The Sydney Opera House Project

The Sydney Opera House Project is an iconic example of project management case studies as it faced multiple challenges during its construction phase. Despite facing leadership changes, budget overruns, and design failures, the project persevered and was completed in 1973, a decade later than planned. The Opera House stands as a symbol of perseverance and successful project management in the face of humankind.

2. The Airbus A380 Project

The Airbus A380 Project is a project management case study showcasing the challenges encountered during developing and producing the world’s largest commercial aircraft. The project experienced massive delays and impacted costs of more than $6 billion, with several issues arising from the manufacturing and delivery process, outsourcing, and project coordination. 

However, the Airbus A380 was successfully launched through carefully planned project management strategies, delivering a world-class aircraft that met customer expectations.

3. The Panama Canal Expansion Project 

The Panama Canal Expansion Project serves as a compelling case study, illustrating the management’s encounters in expanding the capacity of the Panama Canal. The project included multiple stakeholders, technological innovations, environmental concerns, and safety challenges. 

4. The Boston Central Artery/Tunnel Project

The Boston Central Artery/Tunnel Project serves as a project management case study of a large-scale underground tunnel construction project. It successfully addressed traffic congestion and was completed in 2007. The project was completed in 2007, with numerous hurdles delaying progress like complexity, technology failure, ballooning budgets, media scrutiny, etc.

5. The London 2012 Olympics Project

The London 2012 Olympics Project stands as a successful project management case study, showcasing the management of a large-scale international sporting event. This project involved the construction of a new sports infrastructure, event logistics and security concerns. The project was successfully accomplished, delivering a world-class event that captivated the audience.

6. The Hoover Dam Bypass Project

The Hoover Dam Bypass Project was a construction project in the United States of America that intended to alleviate traffic from the Hoover Dam by building a new bridge. Completed in 2010, the bridge spans across the Colorado River, connecting Arizona and Nevada and offers a safer and more efficient route for motorists.

7. The Golden Gate Bridge Seismic Retrofit Project

The Golden Gate Bridge Seismic Retrofit Project is a case study example constructed in San Francisco, California. Its objective was to enhance the bridge’s resilience against earthquakes and aftershocks. Completed in 2012, the project included the installation of shock absorbers and other seismic upgrades to ensure the bridge’s safety and functionality in the event of a major earthquake.

8. The Hong Kong-Zhuhai-Macau Bridge Project

The Hong Kong-Zhuhai-Macau Bridge Project is a massive case study that intends to connect Hong Kong, Zhuhai and Macau with a bridge-tunnel system of 55 kilometres. Completed in 2018, the project required massive funds, investments and innovative engineering solutions, providing a new transport link and boosting regional connectivity.

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9. The Panama Papers Investigation Project

The Panama Papers Investigation Project is a global case study of journalistic investigations into offshore tax havens. It involved leaked documents from Mossack Fonseca, a Panamanian law firm. Coordinated by the International Consortium of Investigative Journalists, the project resulted in major political and financial repercussions worldwide, garnering widespread media attention.

10. The Apple iPhone Development Project

The Apple iPhone Development Project started in 2004, aiming to create a groundbreaking mobile device. In 2007, the iPhone transformed the industry with its innovative touchscreen interface, sleek design, and advanced features. This project involved significant research, development, marketing, and supply chain management investments.

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11. The Ford Pinto Design and Launch Project

The Ford Pinto Design and Launch Project was a developmental project intended to create an affordable, fuel-efficient subcompact car. Launched in 1971, because of its fuel tank design, it became infamous for safety issues. The project was rigged for ethical and safety concerns, lawsuits, and recalls.

12. The Deepwater Horizon Oil Spill Response Project

The Deepwater Horizon Oil Spill Response Project was a response to the largest oil spill in US history, caused by an offshore drilling rig explosion in 2010. This crisis response project utilised a waterfall project management approach, where the project team followed a pattern of planning, executing, monitoring, and closing phases. 

13. The NASA Challenger Space Shuttle Disaster Project

  The NASA Challenger Disaster Project was a tragic space exploration mission in 1986, resulting in the loss of all seven crew members. Extensive investigations revealed design and safety flaws as the cause. This disaster prompted NASA to address decision-making processes and improve safety cultures.

14. The Three Gorges Dam Project

  The Three Gorges Dam Project was a large-scale infrastructure project developed in China that aimed to build the world’s largest hydroelectric dam on the Yangtze River. Completed in 2012, it encountered environmental, social, and engineering challenges. The dam currently offers power generation, flood control, and improved navigation, but it has also resulted in ecological and cultural consequences.

15. The Big Dig Project in Boston

The Big Dig Project was a transportation infrastructure project in Boston, Massachusetts, intended to replace an old elevated highway with a newer tunnel system. Completed in 2007, it serves as one of the most complex and costly construction endeavours in US history. Despite facing many delays, cost overruns and engineering challenges, the project successfully improved traffic flow and urban aesthetics but also resulted in accidents, lawsuits, and financial burdens.

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16. The Uber Disruptive Business Model Project

  The Uber Disruptive Business Model Project was a startup that introduced a new ride business model that disrupted the taxi-cab industry by connecting riders with drivers via a mobile app. Launched in 2010, this project required innovative technology, marketing and regulatory strategies and faced legal actions and ethical challenges related to labour, safety, and competition. Uber has since then dominated the market with its ride-sharing business plan.

17. The Netflix Original Content Development Project

The Netflix Original Content Development Project was an initiative created to launch its original content for its platform. This launch by the online streaming giant in 2012 was a huge success for the company. The project required huge investments in content creation, distribution and marketing and resulted in award-winning shows and films that redefined the entire entertainment industry’s business model.

18. The Tesla Electric Car Project

The Tesla Electric Car Project was a revolutionary project that aimed to compete for its electric vehicles with gasoline-powered vehicles. The project required a strong project management plan that incorporated innovation, sustainability, and stakeholder engagement, resulting in the successful launch of the Tesla Roadster in 2008 and subsequent models. Tesla has one-handedly revolutionised the entire automobile industry on its own. 

19. The Johnson & Johnson Tylenol Crisis Management Project:

The Johnson & Johnson Tylenol Crisis Management Project was a case study in crisis management in 1982. The project required quick and effective decision-making skills, stakeholder communication, and ethical leadership in response to the tampering of Tylenol capsules that led to deaths. 

20. The Airbnb Online Marketplace Platform Project  

The Airbnb Online Marketplace Platform Project was a startup that created an online platform which connected travellers with hosts offering short-term rental accommodations in flights. The project required innovative technology, user experience design and stakeholder management. Airbnb’s success has led to the disruption of the hospitality industry and inspired many other project case study examples of sharing economy platforms.

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Future developments in project management.

Future developments in project management include all the insights on the increased use of artificial intelligence, agile methodologies, hybrid project management approaches, and emphasis on sustainability and social responsibility, along with many more developing ideas that will address the evolving market innovations. 

Key Takeaways from the Case Studies

The project management case study examples illustrate real-life examples and the importance of project management in achieving project success. The cases show the use of innovative technologies, tools, techniques, stakeholder engagement, crisis management, and agile methodologies. 

Project Management also highlights the role of ethical leadership and social responsibility in project management. To learn more and more about case studies, upGrad, India’s leading education platform, has offered an Advanced General Management Program from IMT Ghaziabad that will equip you with in-demand management skills to keep up with the changing trends!

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Frequently Asked Questions (FAQs)

Project Management is extensive planning, executing, monitoring and closing of a project before its deadline. Project management ensures accuracy and efficiency across all organs of a project, right from its inception to its completion.

Project Management case studies are real-life examples of projects to put an insight into all the tools, techniques and methodologies it provides.

The role of a project manager is to ensure that all day-to-day responsibilities are being met by the resources deployed in a certain project. They have the authority to manage as well as lead the functioning members as well.

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Top 10 Project Management Case Studies with Examples!

Real cases are the concrete material for those who want to go into professions. The ten real-world project management case studies with examples look into successful project management strategies and emphasize the need for proper planning, communication, and problem solutions. They show us different sectors of the economy, from technology, construction, health, and many others. The case studies will help you develop a deeper knowledge of how project management tools are implemented in different situations. It doesn’t matter whether you are a project manager or aim to get certified as a PMP ; the case studies will be instrumental in that. Through this analysis, high project management significance is demonstrated and the strategies as well as means of achieving project success become clearer.

Brief Overview of Project Management

Process management involves scheduling, execution, and completion of tasks in a planned and interconnected way to achieve desired goals in a timely. Practical application: utilizing knowledge, resources, and processes to achieve project objectives efficiently. Moreover, project management aims to deliver customized outcomes within specified constraints like scope, time, cost, quality, and risk.

Lastly, the matter fact that effective project management needs good leadership skills, excellent communication, risk management, and the ability to change according to the circumstances becomes vital. Therefore, various project management methodologies , such as Agile, Scrum, and Waterfall, provide frameworks for guiding through their project life cycles.

Top 10 Project Management Case Studies and Examples

The following are the summaries of ten project management case studies and examples that highlight various aspects of successful project execution and lessons learned:

Case Study 1: The Sydney Opera House

The renowned Sydney Opera House is one of the world’s iconic symbols for architecture. This particular place is situated in Sydney, Australia. The project took off in the middle of the 1950s to produce a world-class entertainment facility towering the city skyline. The competition for the structure design was won by the Danish architect, Jørn Utzon with him becoming the lead of the building team, and the construction commenced immediately the following year.

Also, the design of the Opera House returns its shell-like constructions that are quite problematic both esthetic and engineering. It intended to produce a space that would be home to a diverse range of performing arts activities and become a symbol of Sydney, achieving this goal through a combination of its function and transformative design.

Subsequently, the Sydney Opera House case study is regarded as an important source of experience for project managers and they continue to underline the necessity of developing a holistic approach that involves leading practicians, highly efficient teamwork, and powerful project governance to be able to manage this kind of project successfully.

Case Study 2: NASA’s Mars Rover Mission

NASA farms the Mars Rover mission to discover and gain insight into the surface of the planet. Within these tracked roving vehicles are two-wheeled Sojourner, Spirit, Opportunity, and Curiosity alongside the most recent one Perseverance. All rovers had these instruments on board for Martian surface analysis, looking for traces of space biology, and studying the core history of the planets.

In addition, the program involves all-encompassing planning, impeccable calculations, and sophisticated technology to deliver impeccable results. For the discovery of the Moon’s geological dynamics, each rover was a testament to space exploration as well as robotics in scientific investigations.

Astronauts aboard Mars Rover involve the use of effective project management , risk identification, and adaptability, which are the keys to space exploration. This is another example of how such missions provide a learning and also development opportunity for future space exploration endeavors.

Case Study 3: The London Olympics 2012

Its aim was an uncomplicated worship of the Summer Olympic and Paralympic Games which accepted athletes and spectators from the whole world as the participants. These world-changing constructions revolutionized and greatly influenced the everyday life of Londoners, shaping their way of life significantly.

Nevertheless, the London Olympics set a legacy beyond the lasting success of the event. Furthermore, authorities converted and repurposed the infrastructure surrounding Olympic Park for public use, stimulating urban regeneration efforts. The project management best practices for event planning are centered around environmental conservation measures, economic impact, and community intervention.

Case Study 4: Apple’s iPhone Development

Apple inc.; making the iPhone is the epitome of complex product development. There was no such thing as the iPhone in 2007, just a phone that was much more than that magical device that incorporated a phone, iPod, and internet communication appliance into a single thing. 

Designing a quality product involves integrating high-tech hardware, software, intuitive user interfaces, and various technologies seamlessly.

Apple’s iPhone exemplifies agile innovation, quality-speed balance, and lasting market impact, driving unparalleled business success.

Case Study 5: The Panama Canal Expansion

The 2016 announcement of the Panama Canal Extension addressed the need for accommodating larger vessels amid global seaborne trade growth. The first canal built, finished in 1914, could not have been a passageway for the size and capacity of these days’ ships. Additionally, the extension project targeted these inadequacies and intended to uplift the channel’s performance in terms of time-saving and upgrading the global shipping sector.

To conclude, the Panama Canal is an excellent example of how much infrastructure developments are needed as the world is rapidly changing. The project that stands behind the success of global collaboration and project risk management became the vehicle of a plan that influenced the way of doing international trade, and the Panamanian economy.

Case Study 6: The London Crossrail Project

The Crossrail London project, also called the Elizabeth Line, improves transportation connections in London through extensive rail network construction. The main goal is to design a straight east-west railway, spanning key city districts and neighboring territories.

Moreover, the London Crossrail line confronting the delays and overflows of funds, at last, created a disruptive shift in London public transport. In that respect, the positive results and public benefits show the role of major projects that focus on green transit infrastructure in creating urban connectivity and driving ecological and social development.

Case Study 7: The Big Dig – Boston Central Artery/Tunnel Project

The Big Dig, of the Boston, Massachusetts, Central Artery/Tunnel Project was this outstanding public works effort. The project aimed to enhance urban transportation by replacing the Central Artery with tunnels, bridges, and interchanges to expedite traffic.

The project required innovative engineering to tackle tunnel construction, soil conditions, and water management challenges. Moreover, effective public and political expectations management was critical, necessitating extensive public engagement, transparent communication, and collaboration across government entities.

Despite facing delays and cost overruns, completing the Big Dig in 2007 marked a transformative moment for Boston. The project achieved its goals of improving traffic, revitalizing urban areas, and driving economic growth through new developments. Therefore, the success of the Big Dig serves as a case study in adaptive project management, overcoming technical complexities, and achieving positive urban and economic outcomes in large-scale infrastructure projects.

Case Study 8: The Hoover Dam

Planners began the Hoover Dam project in 1936, aiming to meet water and electricity needs in the southwestern USA. Additionally, technologically innovative, the dam featured an arch-gravity design and introduced advanced concrete construction methods. Engineers overcame desert conditions using continuous pouring and refrigeration to counter high temperatures during construction.

Moreover, the Hoover Dam’s enduring impact includes water supply management by creating Lake Mead, one of the largest U.S. reservoirs. The power plant at Hoover Dam generates electricity for the regional grid, serving as a reliable and ongoing energy source. The dam has gained significance beyond its strict utilitarian role. The dam symbolizes America’s resilience and cleverness, drawing millions of visitors to appreciate its cultural, historical, and engineering significance.

Case Study 9: The Airbus A380 Project

The Airbus A380 holds this exceptional record and thereby symbolizes a development breakthrough in the aviation industry in 2007 respectively. The designers created the twin-deck, wide-body aircraft for maximum capacity and comfort, making it ideal for long-distance travel.

Also, it serves the global collaboration in aerospace engineering evidenced by the contributions of different countries as the project was taken as a whole.  Moreover, the Airbus A380 project portrays the complexities of global collaboration, overcoming technical difficulties, and embedding oneself in the competition of the aerospace industry as well. The A380’s impact on aviation underscores lessons in adaptation and environmental consciousness for shaping tomorrow’s airline transportation.

Case Study 10: The Hubble Space Telescope Repair Mission

The HST Mission repaired the telescope’s optical issues, unleashing its full astronomical potential and overcoming initial obstacles. Starting in 1990, Hubble had a manufacturing problem in one of the primary mirrors, which caused blurred images. As a consequence of that day, NASA carried out the first mission of servicing (STS-61) in 1993. Astronauts conducted a complex EVA to install WFPC-2 optics on Space Shuttle Endeavour, addressing Hubble’s optical issues.

However, this repair mission showcased the collaborative efforts of NASA and astronauts, emphasizing meticulous training, communication, and problem-solving skills. The success of the mission marked a turning point for Hubble, transforming it into a premier astronomical observatory. Subsequent servicing missions further upgraded instruments, extending Hubble’s lifespan and contributing to groundbreaking scientific discoveries. 

These top 10 project management scenarios showcase real-world industry challenges in action. Thus, from the dissertation of the given cases, you can be more capable of leading your projects appropriately. Would you like to elevate your expertise? Join our project management course package now, which covers everything from detailed instructions to hands-on experience.

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