ECH 3603

PROJECT DEVELOPMENT
AND MANAGEMENT
Prof Dr Azni Idris

Course Evaluation:
-

Assignment 20%
Test 1
20%
Test 2
20%
Final exam
40%

Main Synopsis
Introduction to project management
Project development and
management
Management in detail design
Project evaluation and cost analysis
Project financing and quality
assurance
Malaysian government regulations
Case studies

Program outcome (PO)

References
1. Clements, J.P. and J. Gido. Effective Project Management, 5 th
Edn, South Western, 2012.
2. Chitkara, K.K., Construction Project Management Planning,
Scheduling and Controlling, Tata McGraw Hill, Delhi, 2004
3. Lawson, G., Wearne S.H. and Iles-Smith, P., Project
Management for Process Industries, IChemE, London, 1999.
4. Meredith, J.R. and Mantel, S.J., Project Management: A
ManagementApproach, 4th Ed, John Wiley & Sons, New York,
2000.
5. Park, C.S., Contemporary Engineering Economics, AddisonWesley Publishing Company, New York, 1993.
6. Wysocki,
R.K.
and
McGray,
R.,
Effective
Project
Management, 3rd Ed., Wiley Publishing, Indiana, 2003.
5

What is a project ?
A Project is a series of related jobs
usually directed toward some major
output and requiring a significant
period of time to perform.
It is temporary in nature, with
specific start and end dates.
Every project has its unique features
and construction procedure.
6

Type of projects
Give examples of a project .
Chemicals processing
A Processing Plant or factory
A Processing Plant Upgrading facilities
A Production change or renovation works
Mechanical project ?
Civil and structure project .?
Utilities project .?
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10

 Basic components in a project:

Planning
Design
Procurement
Construction or fabrication
Commissioning

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Other projects .

Management projects
Planning a training sessions
Business and feasibility studies
Safety audits
Environmental Impact Assessment
Research projects

12

Characteristics of a Project
Key features of these definitions are that a project
has the following characteristics:
A project is a unique undertaking: each one will
differ from every other in some respect.
Projects have specific objectives (or goals) to
achieve.
Projects require resources.
Projects have budgets.
Projects have schedules.
Projects require the effort of people.
Measures of quality apply.
13

Objectives of a Project
Project Objectives:
Performance
Time
Cost
Expectations of clients inherent part of the
project specifications
There are ancillary (process) goals:
Improving the organization's project
management competency & methods
Individual managerial experience gained
The health of the project team and the
organization
Environment

14

What is Project Management ?

Definition:
1. A novel undertaking or systematic
process to create a new product
or service the delivery of which
signals a completion. Projects
involve risk and are typically
constrained by limited resources.
2. A process for conducting work that
produces a new product of one sort
or another.

15

3.

A process or undertaking that

encompasses an entire set of
activities
having
a
definable
starting point and well defined
objectives, the delivery of which
signal the completion of the
project. Projects are usually required
to be accomplished within limited
resources.
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Project Concept
An imaginative arrangement of a set
of ideas.
Concept definition document
- A document describing the concept
selected for development and the
results of investigating alternative
system concepts. It is used to derive
the System Specifications and the
Statement of Work. Also known as
System Concept Document.

17

Concept Phase
The first phase of a project in which
the need is examined, alternatives
are
assessed,
the
goals
and
objectives
of
the
project
are
established and a sponsor is
identified.
The first of four sequential phases in
the generic project life cycle. Also
known as Idea, Economics, Feasibility
or pre-Feasibility Phase.

18

Concept Study
Consideration of an idea that includes a
review of its practicability, suitability,
cost-effectiveness, etc. usually followed
by a recommendation whether or not to
proceed with a/ the project.
A broad-scale plan that takes place well
before begins; the recognition of a
need for a project and a study to decide
whether it is practical or not.
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From concept to finish

20

Learning outcome..
What are the 3 most important
lessons learnt ?

21

Project Life Cycle

Project Life Cycle: changing
patterns of resource usage
and level of activity over
the course of the project.
Time distribution of
projecteffort is
characterized byslowrapid-slow process.
22

 Stages of a conventional project:

Slow beginning
Buildup of size
Peak
Begin a decline
Termination
(See Figure nxt slide)

23

How project moves with time

Actual
time

Cumulativ
e time

24

The Project Life Cycle: Four Basic Phases

typical project life cycle separated into its generally accepted
four fundamental phases.

25

Time Distribution of Project Effort

Level of effort

Peak Effort Level

Time
Concepti
on

Selectio
n

Planning, Scheduling,
Monitoring

Evaluation
&
Terminatio
n

Minimal effort at the beginning stage

Increasing effort during implementation
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Decreasing effort when project moves towards the

Project Bar chart schedule

typical building project bar chart which relates the master schedule
activities to the phases.
You will see that the acceptance of a tender and award of the major
contract is taken as an arbitrary zero on the time base. This is
because it is a clearly defined point in time and its significance in the
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life of a project is commonly understood.

PROJECT CYCLE
Example:

Project cycle in
software
development

28

Project Initiation Phase

Initiate the project - definition

Identify the Project Manager
Develop the Project Charter
Conduct a Feasibility Study
Define Planning Phase
Sign off on the Project Charter

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Project Planning Phase

Organize and staff the project
Develop a Project Plan
Sign off on the Project Plan

30

Project Execution Phase

Execute the Project Plan

Manage the Project Plan
Implement the projects results
Sign off on projects completion

31

Project Close-out Phase

Document the lessons learned
during the project
After-implementation review
Provide performance feedback
Close-out contracts
Complete administrative close-out
Deliver project completion report

32

Project size
Sizing A Project
Project size is based on work effort represented by the estimated effort
(not duration) required to complete the work, and on the budget required
(if any) to complete the project. Select Project Size using either work
effort or budget, whichever results in the higher class.

Project Classification Sizing Matrix

Work Effort
Project Size
Budget
(Hours)
1
<100
< $3,000
2
100 - 300
$3,000 - $10,000
$10,000 3
300 - 600
$25,000
$25,000 33
4
600 - 5,000

Project Management Principles

i. Pre-planning
ii. Detailed Planning
iii. Implementation
iv. Post-project review

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Risk during life cycle

With most projects there is some
uncertainty about the ability to meet
project goals
Uncertainty of outcome is the
greatest during the beginning of a
project
Uncertainty declines as the project
moves toward completion
35

Risk in making a costing uncertainty

Project
Cost

estimates

Time

36

 Cost estimation is done during project

implementation
Degree of uncertainty is reduced after
each forecast at T1 and T2
37

4 phases of the Project Life

Cycle:
1. Conceptual and initiation phase

Start project
Establish need Terms of Reference
(TOR)
Pre-feasibility carried out

38

 Feasibility study
To check whether the project is feasible or
not

Questions:
Do you need the project?
When is the project needed?
Does the project depend on other projects?
Is there any other way to achieve the same
objectives?
39

PROJECT Term of Reference (TOR)

Define objective
Identify the objectives of the project

Develop Terms of Reference (TOR)

What is TOR?
Set-up the project brief, justification, targets.

TOR:
Provide a brief description of the project and the surrounding context (up to
1 page of narrative).
Include critical aspects of the biodiversity, policy, social, and economic
context of the project.
Identify major stakeholders and their interests and concerns.
Detailed background information (e.g. project action plan/ logical
framework)
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TOR

Terms of reference are used to describe the purpose roles

and structures of projects, working groups, reference groups
and committees. They are guidelines for the way group
members will work with each other and are usually the first
task undertaken by a group.
They are usually documented by the project manager and
presented to the group for approval. This provides members
of the group with a clear definition of the project's scope.
Terms of reference provide a written basis for making
decisions, confirming a common understanding between
members how they will make decisions and work together.
Terms of reference should include
What is to be achieved - Vision, objectives, scope and
deliverables
Who will participate - stakeholders, roles and responsibilities
How it will be achieved - resource, financial and quality
plans
When the work will be achieved - a schedule and the

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TEMPLATE FOR TERMS OF REFERENCE

Project Background and Context
.
Provide also the following key information:
Project Location
Project Name
Project reference number
Project budget
Donor(s)/ funding sources
Project duration
lmplementing agency and
partners
Project executant

Specify the region, country, or landscape as

appropriate.
xxxxxx
yyyyyy
State the total budget for this donor (noting the
contract currency and exchange rate used). Also
state the global (total) budget for this project.
State all donors and (where applicable) the precise
funding sources.
State the project duration and the evaluation
period (if different)
State which organization(s) are implementing the
project
Name of project owner, consultant, contractors,
etc
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2. Design and development phase

Product or service design start

Establish Detailed schedule (work plan)
Establish completion plan and dates

43

3. Implementation or construction
phase/fabrication

Implement following Phase 2

requirement
Follows time and schedule set in
Phase 2

44

4. Commissioning and handover phase

Acceptance of project
Completion of project
Project termination
Start up phase (after handover)

45

Phase 1 Conceptualization/ Initiation

Key activities

Deliverable of each
Phase
-Develop business case and
-Approval and sign-off of
conduct Project Definition
the Business Case
Workshop
- Appointment of Project
-Identify key stakeholders and Sponsor and/ or Project
draft Stakeholder Matrix
Owner
-Perform Project Selection
-Project Definition
techniques to determine Cost/ Report (PDR)
- Previous project closeBenefit
-Appoint Project Manager
out reports
- Establish Project Manager
- High-level timeline,
-Establish Project and business milestones, deliverable,
objectives
Work Breakdown
-Establish Project and business Structure (WBS)
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-Project Charter
goals

Phase 2 Design & Development

Key activities
-Develop detailed
project plan
-Feasibility study
-Design and
develop best
alternative /
solution
-Develop detailed
blueprints/
diagrams for the
solution

Deliverable of each Phase

-Detailed design and/ or
blueprint for the preferred
alternative
-Detailed financial costs and
benefits
-Prototype, pilot or reference
site
-Implementation plan
-Rollout plan
-Detailed project plan
-Approval of the solution(s)
and mandate to continue 47

Phase 3 - Implementation
Key activities

Deliverable of
each Phase
- This phase is described as the
-Solution and/ or
doing phase where the actual
completed design
solution or design is implemented in
and/ or
the live environment
implemented
-Change management plays a big role -Quality control
-By now the design/ solution should
report
be robust enough to work in the live -Change
environment
management
-Some tweaking of the design may be reports
-User acceptance
required
-The project plan is closely monitored reports
-Earned value
and progress is tracked
-Earned value and project accounting schedules
-Project accounts
is conducted
48
-Contractors are instructed to
-Progress reports

Phase 4 Commissioning/ Handover

Key activities

Deliverable of
each Phase
-Final touches
-Project close-out
-Final testing
report
-Minor details
-Signed-off project
-Throwing the big switch -Client acceptance
-Turning on the new plant report/ signature
-Commissioning/
-$$$$/ profits!!!
Handover
-Developing training
materials
-Developing user manual
-Completing training/
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transfer of knowledge

Links among process groups in a

phase
Initiating
Process

Planning
Process

Controlli
ng
Process

Executin
g Process

Closing
Process
50

Prior
Phase

Design Phase
Initiating
Process

Planning
Process

Executing
Process

Controlling
Process

Closing
Process

Implementation
Phase
Initiating
Process

Planning
Process

Executing
Process

Controlling
Process

Closing
Process

Subsequ
ent
51
Phase

Learning outcomes .

52

Project Team
People and their
roles in a project

53

54

Who is in a project team?

Names

Other names

Definition

Project Hierarchy

Widely used

Group name for all

persons involved

Project Director

Output Manager

Knowledgeable persons to
make a project work
-They own the project
-Involve at strategic level

Quality Control

Monitoring/ advisory
group

Acts like a steering

committee

Project manager

Project leader

Person responsible at
operation level

Project leader

Project leader

Leads as sub-project

Project team

Widely used

People selected to carry

out the duties because of
their skill

Core team

Widely used

People in the 1st phase of

a large project

55

Project Hierarchy
Objectives to ensure the strategic
requirement are considered.
E.g.: chart to represent organization
structure.
- relationship between boss and the
employee
- line of command in project & how
project are controlled
56

People officially involved in the project

(Hierarchy)
Project
Director

Project
Manager
Team
Member

Quality
Control Group

Team
Member

Team
Member
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Project Director
Jobs:
- To set priorities
- Delegate authority
- Monitor performance
- Allocate resources
- Provide guidelines and support
- Act as mentor for inexperienced
project managers
58

Project Manager
Jobs:
- To plan the work NOT to do the
work himself
- To organize and coordinates all jobs
- To lead and supervise activities
- To monitor and control project
- To select the best team for a job
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Project Manager (cont)

Other duties
- Produce progress reports
- Carry out problem solving
- Negotiating purchase
- Cost control

60

Managing Director
(CEO)
Sales & Marketing Director

61

Branch
Manager

Divisional
Manager

Divisional
Manager

Divisional
Manager

Supervisor

Supervisor

Supervisor

Staff

Staff

Staff

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Forming a (Dedicated) Project Team

Corporation X
Human
Human
Resources
Resources

Finance
Finance &
&
Administration
Administration
Other
Areas

Marketing
Marketing

Engineering
Engineering Manufacturing
Manufacturing Procurement
Procurement
Project Manager

MA1
MA1

MA2
MA2

MA3
MA3

EN1
EN1

EN2
EN2

EN3
EN3

MF1
MF1

MF2
MF2

MF3
MF3

PR1
PR1

PR2
PR2

Staff are assigned away from various departments

to work full-time on the project.

Project Team

3 significant learning
outcomes

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