000402824 Managing Systems Implementation Projects

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ABSTRACT

This coursework is a requisite for the course Managing Systems Implementations. The

main objective of this coursework is to check the efficiency of PRINCE2 as projectmanagement methods. In order to do that, emphasizes are given mainly on the benefits as

well as problems that may arise from implementing PRINCE2, and comparison of PRINCE2

with other project methods. Besides, some recommendation has been provided to get better

results from PRINCE2.



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TABLE OF CONTENTS PAGE NUMBER

1. INTRODUCTION 5

2. HISTORY OF PRINCE2 6

3. OVERVIEW OF THE MEHTOD 7-10

3. A. Starting up a project 7

3. B. Planning 7

3. C. Initiating a Project 8

3. D. Directing a Project 9

3. E. Controlling a Stage 9

3. F. Managing product delivery 9

3. G. Managing Stage boundaries 10

3. H. Closing a Project 10

4. BENEFITS OF PRINCE2 11-12

4. A. Benefits to project managers 11

4. A. I. Standard Structure of projects 11

4. A. II. Accurate Planning 11

4. A. II. Communication 11

4. B. Benefits to directors, executives & senior responsible owners 11

4. B. I. Implementing management by exception 11

4. B. II. Savings time and money 11

4. C. Benefits to organization 12

4. C. I. Controlled management 12

4. C. II. Involvement of managers and stakeholders 12

4. C. III. Scalability 12



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4. C. IV. Availability 12

5. PROBLEMS WITH PRINCE2 13

5. A. Problems with ³One size fits all´ approach 13

5. B. Problems with Staged approach 13

5. C. Little added Value 13

5. D. Too formal and bureaucratic 13

5. E. Expensive 13

5. F. Ignoring product delivery mechanism 13

5. G. Agile Mindset 13

6. PRINCE2 VS. PMBOK 14

7. RECOMMENDATION 15-16

8. CONCLUSION 16

9. REFERENCES 17-19

10. APPENDIX 20



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1. INTRODUCTION

After the development of IT, different companies use different types of project management

methods according to their needs. A survey of CIO (2008) shows that in total around 62% of

IT project failed and 25% of IT project get cancelled before completion. In investigating thereasons behind failure of project management, inefficient co-ordination between time and

budget, unexpected increase in maintenance cost, failure to deliver business values are

identified as common reason (Asay, 2008). ³Alvarez (2003) identified seven major reasons

behind project failure. Those are lack of user involvement, organizational structure/lack of

management support, lack of clear vision, unable to manage team, unable to cope with

project size, lack of training, lack of resources. Failure in project management may cause

significant looses to the company. Large British companies are wasting more than £13m a

year each by not scrapping failing IT projects (Antony, 2004).´

A good combination of resources, skills, technology and ideas is the most important driver

behind the success of a project management method (The Office of Government Commerce,

2009). PRINCE2 method of project management proved its efficiency in combining those

skills. ³In this crucial stage of IT project failure, PRINCE methods of project management

has been identified as one of the best adaptable approach for the management of almost all

project (OGC, 2002). Though it was developed for the IT project management for Central

Government in 1989, later it has been adopted by many other public and private firms which

were influenced by the statistics of the PRINCE2 method¶s efficiency. PRINCE2 embodies

several years of good practices in project management.´

The main aim and objective of this coursework is to find out whether the PRINCE2 method is

the best approach of project management method.¶ It would be done by comparing the benefits and problems that may arise from implementation of PRINCE2. Besides, PRINCE2

should also be compared with some other project management methods to checks its

efficiency over them. µ



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2. HISTORY OF PR INCE2

³PRINCE2 means PRojects IN Controlled Environment (PRINCE2, 2002). PRINCE2 is a

registered trademark of The Office of Government Commerce (OGC, 2002)´. Though,

PRINCE2 was first introduced in 1996, it had its root at 1975. OGC (2002) published the

following steps regarding the development stages of PRINCE2:

1975: Simpact Systems Ltd created a project management method known as PROMPT.

1979: µPROMPT was adopted by the Central Computer and Telecommunications Agency

(CCTA) as the standard to be used for all Government information system projects.¶

1989: ³CCTA established PRINCE based on their previous project management method

known as PROMPT. After the establishment, PRINCE effectively superseded PROMPT

within Government projects. PRINCE remains in the public domain and copyright is retained

by the Crown.´

1996: Having been contributed to by a consortium of some 150 European organisations,PRINCE2 published.

Murray (2009) figures the following information regarding the progress of PRINCE2 during

the period of 1996 to 2008:

World-wide practitioners of PRINCE2 more than 250000World-wide user groups of PRINCE2 more than 20

Accredited training & consulting

organisations more than 120

Software tools supporting PRINCE2 more than 50

PRINCE2 Training course languages More than 17

Number of continent used PRINCE2 7

Apart from those progresses, PRINCE2 is being used by private sectors as well as publicsectors and its¶ being used for almost all types of project like construction, change,

technology (Murray, 2009).



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3. OVERVIEW OF THE MEHTOD

PRINCE2 is process driven methods of project management. The PRINCE2 process is

divided into eight processes. Those are:

Source: OCG, 2002.

3. A. Starting up a project

³Before starting any project, it is extremely important to ensure that all perquisite of initiating

the project are on place. µAs PRINCE2 is a controlled management technique, this step of

PRINCE2 enables a controlled start of the project. The six key activities of this stages (OCG,

2002) are:

y Design and appointment of the project management team.

y Ensuring information of the project brief.

y Establish project approach

y Establish customer¶s quality expectations

y Set up a risk log

y Create the initiation stage plan´

3. B. Planning

Planning is a repeatable process and plays an important role in other seven processes of

PRINCE2.¶ Planning provides all personnel involved in the project with information on

requirement, how the requirement will be fulfilled, what equipment and resources would be

use to achieve those equipment and the predicting time of events happening¶(OGC, 2002).



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The key activities of Planning process are shown in the following graph:

Source: ASSIST, 2007

3. C. Initiating a Project

³This stage deals with how the required product quality will be achieved. The main

objectives of this stage are documenting and confirming an acceptable business case, to

establish plan and estimated cost of the project. The following graph represents the process

involved in initiating a project.´


3. D. Directing a Project



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This µsection mainly deals with the rules and regulations that will be followed by project

management team to control the overall project. The objectives of this stage are ensuring

success of the project by providing overall direction and guidance, risk management,

authorizing a stage or exception plan, giving ad-hoc direction¶ etc (OCG, 2002).

3. E. Controlling a Stage

In PRINCE2, projects are broken into stages and those sub-processes dictate how each

individual stage should be controlled. The following cycle is followed to during this stage to

have efficient control to the project:


3. F. Managing product delivery

µThe objectives of this stage is to ensure that planned products are created and delivery. Sub-

processes and key activities of this stage are shown in the following graph:¶


3. G. Managing Stage boundaries



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Managing Stage boundaries deal with the works that has to be done at the end of the

particular stage. It also deals with the actions that have to be taken if the stage goes outside of

its tolerance level. The following process is followed for managing stage boundaries:

Source: ASSIST, 2007.

3. H. Closing a Project

µThe purpose of this stage is to execute a controlled close to the project. Key activities of this

stage are decommissioning a project; identifying follow-on actions; and project evaluation

review (OGC, 2002). OGC (2002) outlined the following objectives of this process:

Check the difference between the prediction of the projects outcome

and actual results of the projects.

Ensure the acceptance of products by the customer and find out to what

extend the product is accepted by the customer.

Confirm that maintenance and operation arrangements are in place

Arranging relevant training if needed.

Make recommendation for future works on the base of recent results.

Prepare an end project report and archive it in project files for future

use.¶



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4. BENEFITS OF PR INCE2

The Office of Government Commerce (2009) described the benefits for PRINCE2 from three

perspectives. Project managers, directors or executives of projects and the organization itself

would be benefited from PRINCE 2.

4. A. Benef its to project managers

4. A. I. Standard Structure of projects

PRINCE2 enables project managers to use a defined structure for delegation, authority and

communication. In 1998, a survey in Systems Integration Management Office (SIMO) had

done by French computer manufacturer and systems integrator shows that 75% of project

managers blame inefficient structure of their company for their failure in accomplishing

project on time (Alvarez, 2003). It represents the importance of a good structure in business.

4. A. II. Accurate Planning

Lack of good planning is one of the major causes behind the failure of project management.

In order to make the planning more accurate, PRINCE2 divide the whole projects into some

manageable stages (OGC, 2002).

4. A. II. Communication

Around 57% of the project fails because of weak communication between the relevant parties

of a project (Alvarez, 2003). In order to remove this problem, PRINCE2 established regular

reporting system within the organization and manage meeting at any vital stage of the project

(OGC, 2002).

4. B. Benef its to directors, executives and senior responsible owners

4. B. I. Implementing management by exception

PRINCE2 use management by exception for the senior management of a project (OGC,2002). If the senior management doesn¶t forecast any problem regarding the project, they

allow the project manager to get into the project (Project Management, 2005). PRINCE2allows senior management to initiate projects confidently and delegate some of the

responsibility and authority for their management. (University of Glasgow, 2008).

4. B. II. Savings time and money

Implementation of PRINCE2 enables senior management to get frequent information about

the project status without arranging time & money consuming meeting (OGC, 2002).



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4. C. Benef its to organization

4. C. I. Controlled management

The name PRINCE2 itself informs that it¶s a project in control environment. Change controltechnique of PRINCE2 ensures controlled management of a project. University of Glasgow

(2008) identifies four important conditions which have been insured by PRINCE2 in order to

maintain control management. Those are clarity of purpose, credible planning, commitment

and control. According to OGC (2002), PRINCE2 describes the following procedures to

ensure control management:

1) How to coordinate people and activities in a project.

2) How to supervise the project3) What steps should be taken if there is variation between the actual results and

predicted results.

PRINCE2 specified each of the above process with its key inputs and outputs and withspecific goals and activities to be carried out, which gives an automatic control of any

deviations from the plan (OGC, 2002). There are eight main processes and 45 sub-processesof PRINCE2 which ensures the controlled and organized start, middle and end part of a

project (OGC, 2005). Besides, PRINCE2 fits into ISO 9000 Quality Management System

(SIEGELAUB, 2004).

4. C. II. Involvement of managers and stakeholders

A Standish Group survey (2001) identified involvement of stakeholders as the most important

driver behind the success of the project (Alvarez, 2003). According to Cane (2006) absence

of all the stakeholders in the aims and objectives of a project is frequently quoted as a causeof project failure. PRINCE2 provides the organization with active involvement of users and

stakeholders throughout the project to ensure that the product(s) will meet the business,

functional, environmental, service and management requirements (OGC, 2005).

4. C. III. Scalability

Every aspects of PRINCE2 may not be applicable to the every projects of an organization. To

help organization with this problems, very process of PRINCE2 has a note on scalability

which enables organization to understand up to what extent they should use PRINCE2 (APM

Group, 2008).

4. C. IV. Availability

The PRINCE2 methodology is in public domain and available of the shelf (APT, 2009).

There are more than 1.6 million pages on World Wide Web related to PRINCE2 (Murray,

2009). Besides there is an existing body of experience and PRINCE user community which



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always available to support organization regarding any problem with PRINCE2 use (APT,

2009).

5. PROBLEMS WITH PR INCE2

Advanced Projects Techniques (2004) identified five problems of PRINCE2 for which

PRINCE2 still is not widely used in private sectors. Those problems are described below:

5. A. Problems with ³One size fits all´ approach

In modern globalized economy, projects are extremely diversified. It would be reallyunrealistic to predict that one standardized project management method like PRINCE2 can be

used for every project. Though the scalability options of PRINCE2 reduce the problem tocertain extent, but the problem can¶t be ignored completely.

5. B. Problems with Staged approach

The staged approach of PRINCE2 requires activities to perform sequentially. This approach

is best for the projects which involve Research and Development or technology development

contents as phase-gates are negotiated their step by step. But those types of project are small

percentages compare to those projects whose don¶t need step by step checking. According to

Tang (2008) PRINCE2 don¶t give enough focus on the softer side of project management,

particularly when it comes to the people involved in the project.

5. C. Little added Value

Some of the processes of PRINCE2 provided little added value to most of the companies.

Directing a project is a good example of those types of processes.

5. D. Too formal and bureaucratic

Implementation of PRINCE2 may create problems for the management with unnecessary

levels of formality and excessive bureaucracy. The smaller the size of a project, the higher

the formality and bureaucracy problem it would face if it implement PRINCE2.

5. E. Expensive

If an organization wants to change its existing project management method for implementing

PRINCE2 it may be disruptive and expensive. In recent credit crunch most of the companies

are trying to minimize their cost. But PRINCE2 will not be a suitable choice for those

organization who wish achieve earlier practical results at lower cost and in shorter time scale

(Dale, 2005).

Best Management Practice (2007) identifies following two limitations of PRINCE2:

5. F. Ignoring product delivery mechanism

PRINCE2 deliberately does not encompass the mechanics of product delivery.



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5. G. Agile Mindset

It is classically built around the time, cost and quality (TQC) triangle which does not quite

line up with the agile mindset.

6. PR INCE2 VS. PMBOK

Many people assume PMBOK and PRINCE2 are competitors, but in reality PMBOK and

PRINCE2 are complementary and can be used in conjunction for effective project

management (Copland, 2007). PMBOK refers to Project Management Body of Knowledge

(Project Management Partners, 2007). PMBOK identifies and describes the subset of project

management which is accepted generally (PMP, 2007). Because of the difference in

abstraction level it¶s very hard to do comparison between PRINCE2 and PMBOK. PMBOK

and PRINCE2 really serve different purposes and are therefore not directly comparable

(Vancouver, 2002).However, some competitive advantages of PRINCE2 and PMBOK can be

identified.

Jucan (2005) defines PMBOK as a guide and PRINCE2 as methodology. PMBOK is a

collection of recommendations and standards which are US standard. For business

organization, PMBOK is like a highway from where they can choose their own comfortable

way (Jucan, 2005). In a word PMBOK deals with various procedures of doing a thing,

whereas PRINCE deals with unique, clear and step by step process.

PMBOK provides information on procurement, earned value management, time management,

communication management, HR management, whereas PRINCE2 doesn¶t cover those topics

(Copland, 2007). Unlike PMBOK, PRINCE2 offers several techniques and it emphasize

mainly on product based planning, change control and quality review technique (Siegelaub,

2004). While PRINCE2 is designed for a variety of customer/supplier situations PMBOK has

been written on the assumption that the project will be run for a customer with a single

(prime) supplier involved throughout (Vancouver, 2002).

Project Management Partners (2007) view PMBOK as a foundation enriched by the

PRINCE2 method. Copland (2007) seen PMBOK and PRINCE2 as complementary, but they

are not in complete and not mutually exclusive.



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7. RECOMMENDATION

Siegelaub (2004) recommend µusing both PMBOK and PRINCE2 to get best result. After

knowing about PMBOK, it can use PRINCE2 to structure their methodology (Siegelaub,

2004). Company can use key components and techniques like product descriptions, quality

review, configuration management, change control, work packages from PRINCE2 and they

can use PMBOK for depth, techniques, plus HR and procurement as needed. There is another

project management method named as Information Technology Infrastructure Library (ITIL)

which is also marked as best practice approach to information services after it combines with

PRINCE2 project management tools (Cane, 2007).

OGC (2002), APM Group (2007), Murray (2007) and Best Management Practice (2007)

emphasizes on combination of PRINCE2 and Dynamic Systems Development Method

(DSDM) to remove the problems of PRINC2¶. The organizational structure after the

combination of PRINCE2 and DSDM would be like this:

(* DSDM roles are shown in yellow)

Source: Richard (2007)



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Having a DSDM option would allow organization using PRINCE2 to have a choice in theway they execute a project. Combination of DSDM and PRINCE2 would enable organization

to take advantage of a more agile approach to converge on an accurate solution (Richards,2007).

OGC (2005), Murray (2007) also recommends the use of P2MM (PRINCE2 maturity model).

It can be used for the following purposes:

µTo help implement PRINCE2 (first time users)

To re-invigorate/enhance existing PRINCE2 implementations

To help organizations improve their project performance by going

beyond training and templates

As a benchmark to assess organizational capability, plan improvements

and measure the improvements

For organizational accreditation¶

8. CONCLUSION

From the above discussion, it has been clear that PRINCE2 methods of projects management

got some problems and those problems affects more to the small private companies compare

to public and other large size private companies. However, there are huge opportunities for

PRINCE2 to grow in future. In terms of recent period, it can be conclude that PRINCE2 may

not be an efficient methodology for all companies, but for large companies and government

sector it is efficient. There are still no records found regarding huge loss in any institute

because of failure in their PRINCE2 strategy. Besides, there is a high chance that there would

be some update on current PRINCE2 so that it can be used by small private firms also.



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9. REFERENCES

1. The Office of Government Commerce, 2005. PRINCE2[Online] OCG. Available at:

http://www.maxwideman.com/papers/prince2-05/prince2-05.pdf [Accessed 05 May

2009]

2. White, I., 2008. Introduction to PRINCE2 ?[online] Assist. Available at:

www.assist.org.uk/Branches/Trent/resources/ASSIST%20Project%20Management%2

0Lecture.PPT [Accessed 03 May 2009].

3. Richards, K., 2007. Integrating DSDM into an existing PRINCE2 environment

[Online] Best Management Practice. Available at: http://www.best-management-

practice.com/gempdf/DSDM_White_Paper_v2.pdf [Accessed 05 May 2009]

4. Gantthead, 2009. Prince2 VS PM. ?[online] Gantthead. Available at:

http://www.gantthead.com/discussions/discussionsTopicContainer.cfm?ID=7280[Accessed 03 May 2009].

5. Wideman, M., 2002. Comparing PRINCE2 with PMBoK?[online] Maxwideman.

Available at: http://www.maxwideman.com/papers/comparing/comparing.pdf

[Accessed 03 May 2009].

6. Murray, A., 2009. PRINCE2 Now and Next [online] APM Group. Available at:

www.best-management-

practice.com/gempdf/Andy_Murray_PRINCE2_Presentation_Sept07.ppt [Accessed

03 May 2009].

7. Copland, T., 2007. PMI¶S PM BOOK VS PRINCE2 [online] PM Partners. Available

at:http://www.pmpartners.com.au/pdf/PMPartner_%20Session_%20Handout_PMBO

K_PRINCE2V2.pdf [Accessed 03 May 2009].

8. University of Glasgow. 2008. PRINCE2 Methodology. [online] University of

Glasgow. Available at:

http://www.gla.ac.uk/services/it/forstaff/projectoffice/prince2methodology/[Accessed

03 May 2009].

9. Advanced Projects Techniques. 2004. W hy PRINCE2 is not widely used in the private

sector. [Online] APT. Available at: http://apt-projects.co.uk/prince2art1e.pdf


10. Asay, M., 2008. 6 2 percent of IT projects fail. W hy? [Online] CNET. Available at:

http://news.cnet.com/8301-13505_3-9900455-16.html[Accessed 04 May 2009].

11. Tang, D., 2008. The other side of PRINCE2 [Online] Bryanbarrow. Available at:

http://bryanbarrow.com/the-other-side-of-prince2.htm[Accessed 04 May 2009].



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12. Azoff, M., 2008. PRINCE2 is failing IT. [Online] Enterprise Network & Services.

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http://www.enterprisenetworksandservers.com/techwatch/art.php?38[Accessed 04

May 2009].

13. Dale, C., 2005. The Underlying Problems with Prince 2® (And Related Project

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http://www.egovmonitor.com/node/1157/print [Accessed 03 May 2009].



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14. Australian Institute of Project Management. 2002. A COMPARISON OF PRINCE2

AGAINST PMBOK . [Online] AIPM. Available at:

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15. SIEGELAUB, M., 2004. H ow PRINCE2 Can Complement PMBOK and Your PMP

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21. Gary, F., 2006. Blueprint for project success. ITT Training, [Online] Available at:

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0000779e2340.html [Accessed 03 May 2009].

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11db-bce6-0000779e2340.html [Accessed 03 May 2009].

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000402824 Managing Systems Implementation Projects