Project Management 101: Project Constraints

Every project has constraints. Understanding each constraint and the relationship between the constraints will allow for more effective management of a project. The primary constraints of a project are risks, resources, budget, schedule, quality, and scope.

Constraint	Definition from the Project Management Body of Knowledge (PMBOK)	Huh? What does that mean?!
Risk	An uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives	What might affect the project and result in a pro or con
Resource	Skilled human resources (specific disciplines either individually or in crews or teams), equipment, services, supplies, commodities, material, budgets, or funds	Who and what is needed to complete the project
Budget	The approved estimate for the project or any work breakdown structure component or any schedule activity	How much money is available
Schedule	An output of a schedule model (a representation of the plan for executing the project’s activities including durations, dependencies, and other planning information, used to produce a project schedule along with other scheduling artifacts) that presents linked activities with planned dates, durations, milestones, and resources	How much time is planned (for each part and the whole of the project)
Quality	The degree to which a set of inherent characteristics fulfills requirements	How well something fits outlined specifications
Scope	The sum of the products, services, and results to be provided as a project	What’s the desired outcome & how will it be accomplished

Since constraints exist for every project, it is important to understand the relationship of project constraints. The relationship of project constraints is if any one of the constraints changes, then one or more other constraints is likely to be affected. If converted to a representative mathematical equation, then the relationship of constraints would be similar to below:

Project Outcome = Risks + Resources + Budget + Schedule + Quality + Scope

The relationship can also be thought of in terms of a pizza (just because I love pizza and am currently craving it) where each constraint is a slice of the whole project, but if one slice is larger, then the other slices will be affected.

For example in a project to implement new accounting software for a customer, the customer approaches you and insists that it is necessary to add a procurement module in addition to the account modules. Accepting the customer’s change request would mean a change in scope since instead of implementing only new accounting software, now the project will implement new accounting and procurement software. By allowing this change to scope (a constraint) other constraints are likely to be affected i.e. quality may decrease if the project remains on the same schedule and budget then some of the specifications may need to be sacrificed to accommodate the scope change, risks may increase since additional work is added to the project will provide more opportunities for uncertainty.

Planning is key to a project’s success, but projects are rarely static. Change happens and when change happens, constraints shift. To adapt to the natural flow of a project, planning should happen frequently and be progressively elaborated as constraints change. Many details and information are not known upon initial planning of a project; progressive elaboration allows for increased detail, accuracy of estimates, and accommodating for changing constraints.  

Disclaimer: The views and opinions expressed are those of the blogger and are not necessarily those of the Federal Reserve Bank of Dallas or the Federal Reserve System.

Project Management 101: Portfolios, Yet Another P

Another one?! One more P remains to round out the important P’s of project management, projects, programs, and portfolios.

As defined by the Project Management Institute (PMI), a portfolio is a collection of programs, projects and/or operations managed as a group. Key characteristics from the definition of a program: programs, projects and/or operations and group management.

A program is a group of related projects managed centrally, a project is a temporary activity that produces unique results, and an operation is ongoing non-project work. A portfolio manages all of these different pieces as a group to achieve strategic objectives. Managing these different items collectively allows prioritization and allocation of resources to best meet the objectives of an organization. While a program focuses on related projects and managing resources to best meet the program objective, portfolios are even broader focusing on meeting the needs of the company above the needs of specific programs, projects or operations. Resources would be reallocated based on priority i.e. if the organization’s objective was to increase customer service, then resources may be focused on improving or expanding operations instead on projects or programs.

Think of a smartphone as a portfolio. Keeping in contact would be part of the key operations, calling, texting, messaging. An application downloaded could be thought of as a project i.e. a game that you wanted to play through and beat or a health tracker that you were using to reach a specific fitness level. Similar applications or functionality would be a program. The smartphone manages this whole collection as a group and there are limits to the resources (space, minutes, messages, data, etc.) leading to prioritization choices.

Portfolios can be applied to departments within an organization as well. Let’s take a financial management department as an example. The overall department would be the overarching portfolio with a variety of groups within the department performing operations i.e. accounting, budgeting, forecasting, etc. In addition there are probably several ongoing projects i.e. software implementations, process improvement initiatives, and expansion planning. Many of these projects can be grouped into programs i.e. all procurement related projects (implementation of an eProcurement solution, redesign of the vendor management process, creation of a procedures manual) could be categorized within the Procurement program. As the needs of the department shift, some items may become higher priority over others and result in portfolio management reallocation of resources to support this initiative i.e. eProcurement solution must be implemented by end of month while other projects or operations are not pushing deadlines leading Financial Management to shift resources from other projects, programs, operations to support the eProcurement solution project.

Effective project, program, and portfolio management is key to an organizations success. Regardless of whether a person is officially titled as a P_____ Manager or not, every member of the workforce is part of some project, program, or portfolio. Knowing the ongoing projects, programs and portfolios can connect the dots in understanding an organization’s objectives, and make you a more effective contributor to these objectives (which has the happy byproduct of increased possibility of being identified by your management as a star performer leading to positive career trajectory)!

Disclaimer: The views and opinions expressed are those of the blogger and are not necessarily those of the Federal Reserve Bank of Dallas or the Federal Reserve System.

Project Management 101: Programs, the Other P

Project management is not the only buzzword out there. There is also program management. Management of this, management of that, what does this p word mean anyways?!

Program

As defined by the Project Management Institute (PMI), a program is a group of related projects managed in a coordinated manner to obtain benefits and control not available from managing them individually. Key characteristics from the definition of a program: related projects,coordinated management, opportunities beyond a single project.

Think of a project and think about one or a few steps above to the bigger picture. The project is trying to achieve a unique product, service or result. But why? How does the project fit into the bigger picture? A project is a piece of the puzzle to accomplishing the business objective. Programs consist of several related projects that are working towards the same business objective. These related projects are managed by a central resource focusing on thecoordination of these projects on effect on strategy, direction, and business objective.Coordinating management of related projects allows for greater control and benefits not available to a single project i.e. economies of scale (similarities of projects within a portfolio that can be leveraged for increased efficiency), conformance to business objective, etc.

Think of each project as the content i.e. a chapter, while a program is the context i.e. the book. The cost and benefit of each project is measured to determine the impact to the overall program. Looking at the impact to the overall program rather than the individual success of one project means that within a program a project could fail, but the program as a whole could still be successful. Some examples of programs are below.

• Shopping Center: establishing each store could be individual projects, the establishment of the shopping center would be the program. Each store’s setup and opening would need to be coordinated to meet the shopping center opening. Stores would be chosen aiming to bring the highest amount of consumer traffic to the center to ensure a successful shopping center. Some stores may not meet the opening date or may go out of the business but the shopping center may still be successful.

• Talent Acquisition: there may be several ongoing efforts that would each be a project (recruitment strategy development, applicant tracking system implementation, onboarding process redesign, turnover & retention analysis, etc.), but the program would be the overall goal of talent acquisition. Across these various projects, similar expertise could be leveraged. Each of these projects could benefit the program, and the impact to the program may determine resource allocation.
• End User Services Upgrade: organizations frequently go through major initiatives to improve end user experience. The initiative i.e. End User Services Upgrade would be the program with several projects falling within the scope of the program i.e. computing equipment replacement, network upgrade, help & service desk establishment, security enhancements, etc. Coordinating these projects centrally could result in cost savings from negotiated contracts from a single vendor to provide multiple services, direction to each project in understanding its impact on the organization, removal of obstacles to the success of each project and the program, etc.

Projects and programs come in all shapes and sizes. Just remember when your organization has several ongoing related projects, grouping these projects with program management could provide great benefits!

Disclaimer: The views and opinions expressed are those of the blogger and are not necessarily those of the Federal Reserve Bank of Dallas or the Federal Reserve System.