PROJECT

MANAGEMENT
 PROJECT
 Project is a temporary endeavor to create
a unique product.

 A Project is a unique set of coordinated

and inter-related activities, undertaken to
meet a defined objective with a defined
start date, a defined end date and a
defined cost.
 WHAT IS SPECIAL ABOUT A
PROJECT?
The 5’C’s are the characteristics of a
Project:
1. A defined objeCtive
2. A defined Cost
3. sChedule -A defined start date and
a defined end date
4. Within given resourCes and
5. All with good Customer relation
 THE FIRST ‘C’ IS ‘DEFINED
OBJECTIVE’
 Objective, also called ‘scope’, ‘quality’,
‘result, needs to be fixed on Day One

 . The ‘Project Management’ says: First

define what you want to achieve in the
end and then do. Make the ‘definition’ as
complete as you can. The more complete
the definition, the stronger the chances of
success.

Example of a road construction

If you start ‘doing’, before
knowing ‘what’,
You will go back to the
first step you skipped:
What is to be done in the
end?
 A DEFINED COST

 ‘DefiningObjective First’ has

another reason: Estimating the
project cost.

 It requires funds.
 3. SCHEDULE -A defined start
date and a defined end date
 Planning: The ‘sChedule’ of a Project

 A Project has a defined completion period.

First define what you want to achieve in the
end and then do. Make the ‘definition’ as
complete as you can. The more complete the
definition, the stronger the chances of
success.
Two Main Network Techniques of Planning
1] Gantt Chart (Bar Chart)
2] AoA (Activity-on-Arrow) Diagram (Also
called ‘PERT’
Nobody plans to fail.
People fail to plan
Plan your work and then
work your plan
 Within given resourCes and
 Every project has a budget.

 Its vital resources are tool, people and

system.

 Project is an organized programs of

predetermined group of activities that
are non routine in nature and that
must be completed using the
available resources within the given
time period.
 5. WITH GOOD CUSTOMER
RELATION
 Projectsare not ready made articles,
rather they are made ready.

 Primaryconcern is customer
requirement.

 Satisfy the customer.

 SOME OTHER
-It has a definite life cycle i.e conception,
definition, planning ,execution,
commission.
- are unique
-requires team work
-generally complex
-require constant change
-optimal utilization of resources
-Need subcontracting
-unity in diversity
 DIFFERENCE

 Programme

 Project

 Task

 Activity
 PROJECT MANAGER
HAD TO BE PROACTIVE RATHER REACTIVE

 Provide team
 Marshals
support. resources
 Link with
 Resolve conflict
issues quickly customer
 Coordinate
 Monitor team
progress team
 performance
 Set standard for
team
 Set realistic goal
 WHAT

IS

MANAGEMENT?
PROJECT MANAGEMENT

PEOPLE
TOOLS
PM

SYSTEM
 DEFINITION
 Project management is facilitation of
planning, scheduling and controlling of all
activities that must be done to meet the
objectives.
 It is an organised venture for managing
project. it involves scientific application of
modern tool as and techniques in planning
,financing, implementing, monitoring,
controlling and coordinating unique
activities or task to produce desirable
output with in constraints of time and
cost.
 SOME MORE DEFINITIONS
 Association of project managers
“Planning, organising, monitoring and
controlling of all aspects of a project and the
motivation of all involved to achieve project
objective safely and with in well defined
time, cost and performance parameters.”
 Harold Kerzner
“Planning, directing and controlling of
company resources for a relatively short-
term project which has been established for
completion of specific goals”
 The FOUR constraints
You can assign value to only three.

P C cost
Performance

S scope

T time
PROJECT LIFE CYCLE

P E C

D
 CAPITAL BUDGETING
 A capital budgeting decision is one that
involves the allocation of funds to projects
that will have a life of atleast one year and
usually much longer.
 Examples would include the development
of a major new product, a plant site
location, or an equipment replacement
decision.
 Capital budgeting decision must be
approached with great care because of the
following reasons:
• Long time period: consequences of capital
expenditure extends into the future and
will have to be endured for a longer period
whether the decision is good or bad.
• Substantial expenditure: it involves large
sums of money and necessitates a careful
planning and evaluation.
• Irreversibility: the decisions are quite
often irreversible, because there is little or
no second hand market for may types of
capital goods.
4 Over and under capacity: an erroneous
forecast of asset requirements can
result in serious consequences. First the
equipment must be modern and secondly it
has to be of adequate capacity
 DIFFICULTIES
There are three basic reasons why capital
expenditure decisions pose difficulties for the
decision maker.
Uncertainty: the future business success is
today’s investment decision. The future in the
real world is never known with certainty.

Difficult to measure in quantitative terms:

Even if benefits are certain, some might be
difficult to measure in quantitative terms.

Time Element: the problem of phasing

properly the availability of capital assets in
order to have them come “on stream” at the
correct time.
 TYPES OF CAPITAL INVESTMENT
 According to tangibility
a)Physical b) Monetary c)Intangible
 By project size
 By degree of dependence
a) mutually exclusive projects (can
execute project A or B, but not both)
b) complementary projects: taking
project A increases the cash flow of
project B.
c) substitute projects: taking project A
decreases the cash flow of project B.
PHASES OF CAPITAL BUDGETING
PLANNING

ANALYSIS

SELECTION

FINANCING

IMPLEMENTATION

REVIEW