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Unformatted text preview: Chapter 1 Introduction
A Guide to the Project Management Body of Knowledge (PMBOK® Guide) is the recognized
standard for the project management profession. As with other professions such as law, medicine,
and accounting, the knowledge contained in this standard evolved from the good practices of
project management practitioners who have contributed to the development of this standard. The
complete Project Management Body of Knowledge is a collection of recognized good practices
that are widely applied by project management professionals and practitioners for the successful
management of projects.
The PMBOK® Guide provides guidelines for managing individual projects within an
organization. It defines project management and related concepts, describes the project
management life cycle, and outlines related processes.
This chapter defines several key terms and provides an overview of the PMBOK® Guide in
the following major sections:
1.1 Project Management Standard Purpose
1.2 What is a Project?
1.3 What is Project Management?
1.4 Relationship Between Project Management, Program Management, and Portfolio
1.5 Project Management in Operations Management
1.6 Role of the Project Manager
1.7 Project Management Body of Knowledge
1.8 Enterprise Environmental Factors 1.1 Project Management Standard Purpose
The increasing success of project management indicates that the application of appropriate
knowledge, processes, skills, tools, and techniques can have an impact on the success of projects.
To provide readers with a general overview of the project management discipline, the PMBOK®
Guide identifies that subset of the Project Management Body of Knowledge generally recognized
as good practice. “Generally recognized” means the knowledge and practices described are
applicable to most projects most of the time, and there is consensus about their value and
usefulness. “Good practice” means there is general agreement that the application of these skills,
tools, and techniques can enhance the chances of success over a wide range of projects. Good
practice does not mean the knowledge described should always be applied uniformly to all
projects; the organization and/or project management team is responsible for determining
what is appropriate for any given project. This method that allows the standards to work for
most projects most of the time is called “project tailoring.”
The project manager, with approval from the project sponsor, will typically use a certain
level of rigor based on the type of project. It is important that agreed-upon tailoring requirements are documented in the project management plan. This ensures that the project team will follow
the standards defined for the project.
The PMBOK® Guide also provides and promotes a common vocabulary within the project
management profession for discussing, writing, and applying project management concepts.
Such a standard vocabulary is an essential element of a professional discipline.
The Project Management Institute (PMI) views this standard as a foundational project
management reference for its professional development programs, including:
• Project Management Professional (PMP®) certification,
Certified Associate in Project Management (CAPM®) certification,
Program Management Professional (PgMP)SM certification.
Project management education and training offered by PMI Registered Education
Providers (R.E.P.s), and
• Accreditation of educational programs in project management.
As a foundational reference, this standard is neither complete nor all-inclusive. Appendix D
discusses application area extensions, and Appendix E lists sources of further information on
In addition to the standards that establish guidelines for project management processes, tools,
and techniques, there is a code that guides practitioners of the profession of project management.
The Project Management Institute Code of Ethics and Professional Conduct describes the
expectations practitioners have of themselves and others. The Code is specific about the basic
obligation of honesty and fairness. It requires that practitioners demonstrate a commitment to
honesty, ethical conduct, and compliance with laws and regulations. It carries the obligation to
comply with organizational and professional policies and laws. Since practitioners come from
diverse backgrounds and cultures, the Code of Ethics and Professional Conduct applies globally.
When dealing with any stakeholder, practitioners should be committed to honest and fair
practices and respectful dealings. The Project Management Institute Code of Ethics and
Professional Conduct is posted on PMI’s website. 1.2 What is a Project?
Projects differ from other types of work. A project is a temporary endeavor undertaken to create a
unique product, service, or result. These temporary and unique characteristics determine if a
particular endeavor is a project.
If an organization determines the nature of the work to be temporary and unique, it may
decide to apply project management principles. Managing work by applying the project
management standard allows organizations to achieve a set of business objectives more
efficiently and effectively.
The temporary nature of projects indicates a definite beginning and definite end. The end is
reached when the project’s objectives have been achieved, when the project is terminated
because its objectives will not or cannot be met, or the need for the project no longer exists.
Temporary does not necessarily mean short in duration; many projects last for several years.
Temporary does not generally apply to the product, service, or result created by the project; most
projects are undertaken to create a lasting outcome. For example, a project to build a national monument will create a result expected to last centuries. Projects can also have social, economic,
and environmental impacts that far outlast the projects themselves.
The duration of a project is finite. A project’s duration can range from a few weeks to several
years. It may involve a simple set of activities (such as organizing a picnic) or a very complex
effort (such as the design of a new space shuttle). The project team, as a working unit, is created
for the sole purpose of accomplishing a project’s objectives. When a project attains its objective
or it is terminated for some reason, the project reaches its end and the project team is disbanded.
Typically, project team members move on to other projects or return to their original
organizational assignments. Conversely, teams involved in the other types of work (i.e., nonproject but “operational”) are not necessarily disbanded when the work achieves its objectives; a
new set of objectives is adopted and the work continues.
The unique nature of projects means every project creates a specific product, service, or
result that differentiates it from other products, services, or results. Although repetitive elements
may be present in some project deliverables, this does not change the fundamental uniqueness of
the project work. For example, many office buildings are constructed with the same or similar
materials or by the same team, but each facility is unique--with a different design, different
location, different contractors, and so on.
An ongoing work effort is generally a stable process because it follows an organization’s
existing procedures. In contrast, because of the unique nature of projects, there may be
uncertainties about the products, services, or results that the project creates. Project tasks can be
new to a project team, which necessitates more dedicated planning than other routine work. In
addition, projects are undertaken at all organizational levels. A project can involve a single
person, a single organizational unit, or multiple organizational units.
A project can create:
• A product that is quantifiable and can be either a component of another item or an end
item in itself,
A capability to perform a service (e.g., a business function that supports production or
A result such as an outcome or document (e.g., a research project that develops
knowledge that can be used to determine whether a trend is present or a new process will
Examples of projects include, but are not limited to:
Developing a new product or service,
Effecting a change in the structure, staffing, or style of an organization,
Developing or acquiring a new or modified information system,
Constructing a building or infrastructure, and
Implementing a new business process or procedure. 1.3 What is Project Management?
Project management is the application of knowledge, skills, tools, and techniques to project
activities to meet project requirements. Project management is accomplished through the appropriate application and integration of the project management process groups. These process
groups consist of:
• Monitoring and Controlling, and
The project manager, along with the project team, is responsible for accomplishing the
Managing a project typically includes:
• Identifying requirements,
Adapting the specifications, plans, and approach to the different concerns and
expectations of the various stakeholders, and
• Balancing the competing demands for quality, scope, time, and cost.
Project managers deliver projects while balancing the requirements of the scope, schedule,
quality, and budget. The relationship among these factors is such that if any one factor changes,
at least one other factor is likely to be affected. For example, if the schedule is shortened, often
the budget needs to be increased to add additional resources to complete the same amount of
work in less time. If a budget increase is not possible, the scope or quality may be reduced to
deliver a product in less time for the same budget. Project stakeholders may have differing ideas
as to which factors are the most important, creating an even greater challenge. Changing the
project requirements may create additional risks. The project team must be able to assess the
situation and balance the demands in order to deliver a successful project.
Project management processes are iterative because of the progressive elaboration that occurs
throughout the project’s life cycle. Progressive elaboration involves continuously improving and
detailing a plan as more specific information and more accurate estimates become available.
Progressive elaboration allows a project management team to manage to a greater level of detail
as the project evolves. 1.4 Relationship Between Project Management, Program
Management, and Portfolio Management
Project management exists in a broader context that includes program management and portfolio
management. Figure 1-1. Portfolio, Program, and Project Management Interactions 1.4.1 Portfolio Management
A portfolio refers to a collection of projects or programs and other work that is grouped together to
facilitate effective management. The projects or programs of a portfolio may not necessarily be
interdependent or directly related. For example, an infrastructure firm that has the strategic
objective of “maximizing the return on its investments” may put together a portfolio that includes a
mix of projects in oil and gas, power, water, roads, rail, and airports. From this mix, the firm may
choose to manage related projects as one program. All of the power projects may be grouped
together as a power program. Similarly, all of the water projects may be grouped together as a
Portfolio management refers to the centralized management of one or more portfolios and
includes identifying, prioritizing, authorizing, managing, and controlling projects, programs, and
other related work. Portfolio management focuses on ensuring that projects and programs are
reviewed to prioritize resource allocation, and that the management of the portfolio is consistent
with and aligned to organizational strategies. 1.4.2 Program Management
A program refers to a group of related projects managed in a coordinated way to obtain benefits
and control not available from managing them individually. Programs may include elements of
related work outside the scope of the discrete projects in the program. Some examples of programs
• A new car model program that involves projects for the design and upgrades of each
major component (e.g., the transmission, engine, interior, and exterior) while ongoing
manufacturing occurs on an assembly line, and
• An electronics firm that has program managers who are responsible for both individual
product releases (projects) and the coordination of multiple releases over a period of time
(an ongoing operation).
Program management can be viewed as the centralized, coordinated management of a group
of projects to achieve the program's objectives and benefits. Programs can involve several
repetitive or cyclical undertakings. For example, utility companies may combine a series of
projects into an annual “construction program.” 1.4.3 Projects and Strategic Planning
Projects are a means of organizing activities that cannot be addressed within the organization’s
normal operational limits. Projects are often utilized as a means of achieving an organization’s
Projects are typically authorized as a result of one or more of the following strategic
considerations. Some examples of these include, but are not limited to:
• Market demands (e.g., an oil company authorizes a project to build a new refinery in
response to chronic gasoline shortages),
• Organizational needs (e.g., a training company authorizes a project to create a new course
to increase its revenues),
• Customer requests (e.g., an electric utility authorizes a project to build a new substation
to serve a new industrial park),
• Technological advances (e.g., a software firm authorizes a new project to develop a new
generation of video games after the introduction of new game-playing equipment by
electronics firms), or
• Legal requirements (e.g., a chemical manufacturer authorizes a project to establish
guidelines for the handling of a new toxic material).
Projects, within programs or portfolios, are a means of achieving organizational goals and
objectives, often in the context of a strategic plan. Although a group of projects within a program
can have discrete benefits, they often also contribute to consolidated benefits as defined by the
Organizations manage their portfolios based on their strategic plan, which may dictate a
hierarchy in the portfolio, program, or projects. One goal of portfolio management is to
maximize the value of the portfolio by the careful examination of the candidate projects. Those
projects not expected to meet the portfolio’s strategic objectives may be excluded. The
organization’s strategic plan and available resources guide these investments in projects. As Figure 1-1 illustrates, organizational strategies and priorities are linked and have
relationships between portfolios and programs, and between programs and individual projects.
Organizational planning impacts the component projects by means of project prioritization.
Organizational planning can direct the funding and support for the component projects on the
basis of risk/reward categories, specific lines of business, or general types of projects, such as
infrastructure and internal process improvement.
At the same time, projects provide feedback to programs and portfolios by means of status
reports and change requests that may impact other projects, programs, and portfolios. The needs
of the projects, including the resource needs, are rolled up and communicated back to the
portfolio level, which in turn sets the direction for organizational planning. 1.4.4 Project Management Office
A Project Management Office (PMO) is an organizational body or entity that can be responsible
for the centralized and coordinated management of the projects, programs, and portfolios under its
domain. The projects supported or administered by the PMO may not be related other than by
being managed together. The specific form, function, and structure of a PMO is dependent upon
the needs of the organization that it supports.
A PMO may be delegated authority to act as an integral stakeholder and a key decisionmaker during the initiation phase of each project, to make recommendations, or to terminate
projects to keep business objectives consistent. In addition, the PMO may be involved in the
selection, management, and redeployment of shared or dedicated project resources.
Some of the key features of a PMO may include, but are not limited to:
• Managing shared resources across all projects administered by the PMO,
Identifying and developing project management methodology, best practices, and
• Developing and managing project policies, procedures, templates, and other shared
• Coordinating communication across projects.
Project managers and PMOs pursue different objectives and, as such, are driven by different
requirements. All of these efforts, however, are aligned with the strategic needs of the
organization. Differences between the role of project managers and a PMO may include the
• • • The project manager focuses on the specified project objectives, while the PMO manages
major program scope changes and can view them as potential opportunities to better
achieve business objectives.
The project manager controls the assigned project resources to best meet project
objectives, while the PMO optimizes the use of shared organizational resources across all
The project manager manages the scope, schedule, cost, and quality of the products of the
work packages, while the PMO manages the overall risk, overall opportunity, and
interdependencies among projects at the enterprise level. 1.5 Project Management in Operations Management
While business goals are achieved through operations, new objectives are typically initiated
through projects. Though temporary in nature, projects can help achieve the organizational goals
when they are aligned with operations. Organizations sometimes change their operations or
products by creating strategic business initiatives that use projects, programs, and portfolios.
Projects require project management while operations require business process management or
operations management. Projects intersect with operations at various points during the product life
• At each closeout phase,
• When developing a new product, upgrading a product, or expanding outputs,
• Until the divestment of the operations at the end of the product life cycle.
At each point, deliverables and knowledge are transferred from the project to operations for
implementation of the delivered work. This occurs through a temporary transfer of project
resources to operations toward the end of the project, or through a transfer of operational
resources to the project at the start.
Operations are permanent endeavors that produce repetitive outputs, with people assigned to
do basically the same set of tasks according to the standards institutionalized in a product life
cycle. Conversely, a project is a temporary endeavor where a team produces and executes a
temporary project management plan. 1.6 Role of the Project Manager
The role of a project manager is distinct from that of a functional manager. Typically the functional
manager is focused on providing management oversight for an operational department and the
resources that support the functional area. The project manager is involved with the planning,
controlling and monitoring, as well as managing and directing the resources associated with a
project. The project manager is also responsible to the project stakeholders for delivering a
project’s objectives within scope, schedule, cost, and quality.
Depending on the organizational structure, a project manager may ...
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- Summer '18