Recovery project – Hoegh Osaka, Portsmouth• A car carrier stranded next

to a busy shipping lane was grounded deliberately to prevent it from capsizing, its owners have said.

• The 51,000 tonne Hoegh Osaka became stricken on the Bramble Bank between Southampton and the Isle of Wight after it sailed from the Hampshire port with its cargo of 1,400 cars. (Telegraph, 2015)

http://www.bbc.co.uk/news/uk-england-hampshire-30940919 WATCH THE RELOAT: http://www.telegraph.co.uk/news/uknews/11330647/Stricken-cargo-ship-Hoegh-Osaka-is-drifting.html

Picture: Peter Macdiarmid/Getty Images

Project Management - Initiation and Planning

Tara LovejoyJanuary 2015

Aims and objectives

• Project initiation and planning - tools and techniques

By the end of this session, you will be able to:

1.Apply the project life cycle during early planning stages2.Describe how to develop project ideas and improve their feasibility3.Set outputs and outcomes for projects4.Create organised planning through Work Breakdown Structures and Gantt

charts5.Evaluate key areas to focus on to maximise success in delivering projects

Key terminologies

• Approvals• Appraisal• Best/good practice principles• Business case• Change management• Dissemination• Evaluation• Feasibility• Gantt chart• Implementation• Monitoring

• Resources - financial• Resources – human• PESTLE/STEEPLE analysis• SMART aims and objectives• SWOT analysis• Project brief• Project Initiation Document(PID)• Quality

assurance/control/management• Risk assessment and mitigation• Stakeholders• Viability

Where are we now?

Relevant theories you may already know Assignment requirements for each level

• Abraham Maslow’s Hierarchy of Needs• Kurt Lewin’s Force Field Analysis• Michael Porter’s Five Forces Model of

Competition• Yohan Wind’s Marketing Segmentation• Phillip Kotter’s Marketing Mix• Igor Ansoff’s Matrix• Raymond Vernon’s Product Lifecycle• Boston’s Matrix• Sakichi Toyoda’s Root Cause Analysis

Level 3• One to 2 aims• 3-5 SMART objectives• SWOT analysis• Work Breakdown Structure with 2-3 levels• Gantt chart

Level 5 • As for L3, plus PESTLE/STEEPLE

Level 6• As for L5, plus applying theories

mentioned here

Planning a project

“No matter how perfect a project plan may be on paper, it is worthless if nobody actually uses it” (Wysocki, 2004)

Typical process to initiate the project

Project Initiation

Taking early stage ideas and developing them further to identify if the project is feasible (will it work)

5 steps to success

1. Know and understand the purpose of the project

2. Maintain a clear grasp on reality

3. Ensure roles and responsibilities are clearly identified

4. Fully utilise project management tools

5. Focus on delivering the project, but include best practice beforehand and when things don’t go to plan

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Six fundamental questions to ask now...1. How does it connect with the organisation’s strategy?

2. How will it be feasible?

3. How will it be viable?

4. What are the planned outcomes on completion?

5. Who is the Project Manager?

6. How will the Project Manager keep the team informed of change to ‘project scope’ and avoid ‘project/scope creep’ (handout provided)

http://blog.etq.com/blog/bid/41605/Avoid-Scope-Creep-in-Enterprise-Software-Implementation

Scope creep (aka project creep)

Business decision making tools to use at this stage ...SWOT Market Research

• Strengths• Weaknesses• Opportunities• Threats

• What other events are happening?• What can you do differently?• What will make people come?• What is included in the event?• What is the pricing strategy?PEST(LE)

• Political• Economical• Social• Technological• Legal• Environmental• Ethical (STEEPLE)

Marketing Mix (4/7Ps) (Phillip Kotter)• Product – Price – Place - Promotion

SMART objectives

• SMART is an acronym that has been credited to both Peter Drucker (1955) and G.T.Doran (1991), though it is difficult to identify whether either of these two were really the first people to use the term ‘SMART’ with reference to objectives.

• Specific – outline in a clear statement precisely what is required.

• Measurable – include a measure to enable you to monitor progress and to know when the objective has been achieved.

• Achievable – objectives can be designed to be challenging, but it is important that failure is not built into objectives. Employees and managers should agree to the objectives to ensure commitment to them.

• Realistic - focus on outcomes rather than the means of achieving them

• Timely - (or time-bound) – agree the date by which the outcome must be achieved.

Chartered Management Institutehttp://www.managers.org.uk/sites/default/files/u271/Checklist%20-%20Setting%20SMART%20Objectives.pdf

Set clear aims and SMART objectives

Aims SMART ObjectivesSpecific – Measurable – Achievable – Realistic – Time-bound

• A long term goal ...▫Increase profit▫Improve customer service

• Example: Sell 10% more milk chocolate every month from January to December 2013

• Short term goals that are used to achieve an aim▫ Increase sales by 20% in year 1▫ Reduce costs by 10% in all

departments over the next 6 months▫ Improve staff training to reduce

customer complaints by 15% between 2015 and 2016

TASK: Let’s have a go ...

• Write down an aim for the project you are considering (pre-SMART)

• Pop it in the pot to pass for someone else to pick out

• Turn your chosen aim into a SMART objective

Example:

• ORIGINAL: Research the retail sector to identify growth areas

• SMART: Research the UK women’s wear retail market to identify the two main growth products/services by 10 December 2014

SWOT analysis – one business decision making tool

http://www.consultants-on-line.com/default.asp?contentID=25

PESTLE – external focus

• Some businesses use PESTLE before the SWOT analysis – why might this be?

• Looks at the external factors that do, and could, influence your business ideas

• Looks at both the positive and negative issues that are happening at the moment and in the future

• Again, used for any project in business and key to business start up and decision making

PESTLE

Political Economical

Social Technological

Legal Environmental

TASK: Let’s have a go ...

• Read through the handout provided and create your own PEST/LE for your project idea, or one of the project ideas within your team

• Aim to create at least 3 bullets for each category using the template provided

Why/how to plan?

• Use some creating thinking techniques to map out your project, i.e.:▫ mind-map (around a central key word or idea)▫ brainstorm (group creativity technique designed to generate a large

number of ideas for the solution of a problem)

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Include issues such as: Consider the implementation of your project ....

• Why this project?• How are you going to deliver

it?• What are you going to deliver?

• What do you need to plan?• What difference will planning make to your

project?• What questions need answering?• What are the processes, approvals etc you

need?• Who do you need to engage and collaborate

with?

Use creative thinking to develop your project idea/s fully

Tony Buzan (1970) mind-mapping technique.

At the time this was a revolutionary system for capturing ideas and insights horizontally on a sheet of paper and is still considered a new and creative model

TASK: Case study – The Body Shop v LUSH

• You work for the Body Shop who have seen declining sales over the last 2 years, predominantly due to the increased competitiveness of LUSH.

• You have been asked to project manage the introduction of a new range of products and services to increase sales and competitiveness with LUSH

• Think about what your first steps will be

• Create a SWOT and/or PESTLE

http://www.dailymotion.com/video/x6u4nc_nature-s-way-to-beautiful-from-the_lifestylehttp://www.youtube.com/watch?v=9fVpOrodlu0www.lush.co.uk/our-values

Chapman and Ward 6W theory

• Used best after the SWOT and PESTLE/STEEPLE has been created to double check that everything has been considered during the planning stages and the idea is feasible and viable

1. Who2. What3. Wherewithal (the necessary means, especially financial)4. Why5. Which way (how)6. When

Project PlanningPresent your vision, time line and costing to the management team and check feasibility of ideas in the early stages of planning

Check the practicalities ...

1. Have you consulted all relevant stakeholders (one who has an interest in the project i.e. Staff, customers, shareholders, government etc)

2. Do you have the authority and approvals to start the project?3. When will the project start and finish?4. What are your customer needs and demands/current trends?5. Which products and services are going to be offered?6. Who will be leading and participating – do you have the right skills? 7. What are the critical factors?8. What are the typical obstacles that might delay your deadlines?9. What are your supplier lead times?

Typical process – key business decision making tools

1. Use creative thinking techniques to develop ideas – brainstorm/mind-map

2. Create a SWOT (internal factors) and STEEPLE (external factors) analysis

3. Set aim/s (long term goal/s)4. Set SMART objectives (short term goals to achieve aim/s)5. Use the Chapman and Ward 6W theory6. Create outputs and outcomes so that you can measure project

success and impact7. Write a Project Brief, Project Initiation Document (PID) or

Business Case for approval

Outputs and outcomes

• An extension of aims and objectives

• Outputs are the products and services you deliver as part of your project i.e. training courses, support sessions, jobs created and publications etc. They can be easily captured during the project, even if it’s a short project.

• Outcomes are the changes, benefits, learning or other impact that happens as a result of your project – what difference it has made

Work Breakdown Structures• Work Breakdown Structures cut up the

project into manageable tasks (Work Packages, WP).

• Resource Breakdown Structures (RBS) look at the resources you have available for the project.

• You can also create a separate Resource Breakdown Structure (RBS) to see who could carry out the tasks (or you could simply allocate work packages to named staff and have a combined WBS and RBS

• For Level 5 & 6, this could help with resource smoothing (ensuring you have the right staff at the right time)

Gantt chart• Used in conjunction

with the WBS – work packages become ‘milestones’ in the Gantt chart.

• In reality, WBS is most useful for small projects, early stage and planning resources.

• Gantt charts are most useful with complex projects, a number of staff involved and not much time for managing the project, when there is no flexibility to move the deadlines and budget

Managing resources• Allocate specific tasks (work

packages) to staff with the right competencies and plan resources effectively by applying resource levelling and resource smoothing (handout provided)

• Resource levelling = “A technique in which start and finish dates are adjusted based on resource constraints with the goal of balancing demand for resources with the available supply.” (PMBOK® Guide 5th edn.)

• Resource smoothing = “A technique that adjusts the activities of a schedule model such that the requirements for resources on the project do not exceed certain predefined resource limits.” (PMBOK® Guide, 5th edn.)

http://www.izenbridge.com/blog/underlining-the-differences-between-resource-leveling-and-resource-smoothing/

https://targetpmp.wordpress.com/category/knowledge-area/time-management/

The S Curve• A type of curve that shows the growth

of a variable in terms of another variable, often expressed as units of time.

• For example, an S curve of the growth of company sales for a new product would show a rapid, exponential increase in sales for a period time, followed by a tapering or levelling off.

• The tapering occurs when the population of new customers declines. At this point growth is slow or negligible, and is sustained by existing customers who continue to buy the product.

• http://www.businessdictionary.com/definition/S-curve.html#ixzz3QPW3028q

• The S-Curve theory helps monitor the progress and growth of an ongoing project at a specific stage or percentage of completion.

• It simply makes use of the projected number of man-hours and costs to complete the project vs. the actual number of hours and costs incurred within the same time frame.

• The mathematical theory aims to represent the utilisation of resources over the proposed time of the project. The curvature illustrates the side by side comparisons of the actual time and expenditure components vs. the proposed time and costs allocations of specific resources.

• As a tracking tool, comparisons of different S- Curves against the standard S-Curve help in monitoring the growth or progress of the project.

Costing budget and assessing feasibility

• You will only have a vague idea of costs, so provide estimates• Ideally, obtain 3 quotes/estimates for costs associated with the

project• List both your planned expenditure (costs) and your planned

income• You can then assess forecasts against actual spend once the

project has started

• We will look at financial viability and feasibility next session ...

Let’s look at the Project Brief and PID

• Level 3 – draft the Project Brief

• Level 5& 6 - draft the PID

Some popular project management books ...

• J. Rodney Turner - The Handbook of Project Based Management (2008)

• David L. Cleland and Lewis R. Ireland – Project Manager’s Handbook (2008)

• David I. Cleland - Project Management: Strategic Design and Implementations (2002)

• Jack R. Meredith, Samuel J. Mantel - Project Management: A Managerial Approach (2008)

• Harold R. Kerzner - Project Management: A Systems Approach to Planning, Scheduling, and Controlling (2013)

Next Session

• Determining financial viability of the project

Homework:• Read through the handouts• Start drafting your project brief/PID for

discussion next week before submission• Get some books on project management

• Is there anything else you would like to cover?

For Level 5 and 6, consider ...Business theories and models applicable at this stage of project management

Feasibility• When testing the feasibility of the proposed project, Tim Bryce’s six stage feasibility

study model, Michael Porter and Raymond Vernon’s theories could also be used during this feasibility study period.

http://www.projectsmart.co.uk/elements-of-a-good-feasibility-study.phpTim Bryce is the Managing Director of M. Bryce & Associates (MBA) of Palm Harbour, Florida, a management consulting firm specialising in Information Resource Management (IRM). Mr. Bryce has over 30 years of experience in the field.

Porter’s Five Forces

Vernon’s Product Lifecycle

Ansoff’s Matrix

Philip Kotler – marketing mix

• “Marketing mix is the set of controllable variables (4 Ps - product, price, place (distribution) and promotion) that business can use to influence the buyer’s response”.

• Each business strives to build up 4 P’s which can create highest level of consumer satisfaction and at the same time meet its organisational objectives.

• Therefore, this mix is assembled keeping in mind the needs of target customers.”

Principles of Marketing, 2010

The marketing mix

The right PRODUCT to the

right PERSON at the

right PRICE

in the right PLACE

at the right TIME

1. Product – What is it? Who will buy the product?

2. Price – How is the product or service priced?

3. Place – How is the product brought, how does it reach the customer?

4. Promotion – How is the product promoted

Harry Igor Ansoff

• Harry. Igor Ansoff Ansoff was a mathematician and a business manager. He known as the father of Strategic management.

• Ansoff was born in Vladivostok, Russia on December 12, 1918. In 1937 Ansoff emigrated to the USA and graduated at Stuyvesant High School, New York City.

• Following graduation Ansoff studied General Engineering at Stevens Institute of Technology where he received a Master of Science degree in the Dynamics of Rigid Bodies.

Corporate Strategy: An Analytic Approach to Business Policy for Growth and Expansion, McGraw-Hill, 1965

• Once the external and internal environment has been evaluated, Ansoff’s Matrix is effective in aligning proposed product and service development with corporate strategy, especially in terms of risk and capacity

The matrix considers the growth of a business:• through new or existing products• in new or existing markets

Ansoff’s Matrix

• Shows the stages that products go through from development to withdrawal from the market

• Theory was initially developed to explain the observed pattern of international trade (and migration) – now widely in marketing/business development strategy

• There are four main market stages - Introduction, Growth, Maturity and Decline (plus saturation and decline)• Introduction - 3D TVs | Growth  - Blueray discs/DVR | Maturity  - DVD | Decline  - Video cassette• Connects with Igor Ansoff’s Matrix (1957) and often used with the Boston Matrix

Raymond Vernon’sProduct Lifecycle (1966)

• Whilst Porter’s model is well renowned for evaluating the external market and considering market positioning, it does not consider whether the organisation has the capacity to compete in that marketplace and meet customer needs and demands.

• Capacity to deliver is an integral issue in terms of alignment with business strategy and core values, safeguarding reputation and profitability.

What about capacity to deliver? Outside in ...

• In 2007, Barney stated that Resource Based Theory (RBS) “offers an alternative to Michael Porter's approach, focusing more on the competences and capabilities of the firm, rather than its positioning in its chosen markets.”

• Barney’s theory builds on Levitt’s (1960) contrasting theory to Porter’s of looking from the inside out when developing strategy. Levitt’s theory also implies that “organisations may be defining its market too narrowly and a change in perspective could open up new opportunities for growth”

Alternative Resource Based Theory

• Force Field Analysis was created by Kurt Lewin in the 1940s. Lewin originally used the tool in his work as a social psychologist.

• Today, Force Field Analysis is also used in business, for making and communicating go/no-go decisions, by listing all of the factors (forces) for and against your decision or change and score each factor based on its influence.

Kurt Lewin’s Force Field Analysis (1951)

http://www.youtube.com/watch?v=yWfvPxah1xs&feature=player_embedded

• Maslow useful for understanding consumer behaviour and 4Ps• Lewin useful for understanding the need for and against change• Maslow could be used to ascertain how people will react to change and better

prepare for implementing products and services

How does Maslow and Lewin compare?

The Boston Matrix▫ A means of analysing the product portfolio and informing decision making

about possible marketing strategies▫ Developed by the Boston Consulting Group – a business strategy and

marketing consultancy in 1968▫ Links growth rate, market share and cash flow

Uses the extended Product Life Cycle (‘saturation’ and ‘decline’)

Sales

Time

Development Introduction Growth Maturity Saturation Decline

The Boston Matrix

ProblemChildren

Products having a low market share in a high growth marketNeed money spent to develop them

Stars

Products in markets experiencing high growth rates with a high or increasing share of the market

Dogs

Products in a low growth market Have low or declining market share

Cash Cows

High market shareLow growth markets

Market Growth

Market Share

High

Low High

• Sakichi Toyoda the “King of Japanese Inventors” and the “Japanese Thomas Edison.” Toyoda’s numerous inventions speak volumes about his contributions. One of these contributions was identifying root causes to problems to solve or prevent detrimental situations. The technique Toyoda developed was called the “5 Whys.” Sakichi Toyoda is ranked number 13th on Forbes.com among the twenty most influential businessmen..

• Useful for getting to the heart of the problem• Could be used in conjunction with Maslow and

Lewin• Toyoda : created one of the most important

industrial inventions that instantly stopped a machine when a problem occurred. He later sold Jidoka’s patent to a British firm for $150,000 and used the money to fund the start-up of Toyota, which eventually became the world’s second largest car manufacturer

Toyoda Root Cause Analysis and 5 Why’s

5 why’shttp://www.mindtools.com/pages/article/newTMC_80.htm

Root cause analysishttp://www.mindtools.com/pages/article/newTMC_80.htm

• Porter (1979) states that “the nature and degree of competition in an industry hinge on five forces: the threat of new entrants, the bargaining power of customers, the bargaining power of suppliers, the threat of substitute products of services and the jockeying among current contestants.

• To establish a strategic agenda for dealing with these contending currents and to grow despite them, a company must understand how they work in its industry and how they affect the company in its particular situation. The collective strength of these forces determines the ultimate profit potential of an industry.”

Michael Porter’s Five Forces Model of Competition Theory (1979)

Mun’s Real Options Analysis

Used to consider a number of opportunities and directions to go in

Particularly useful to decide on level of risk, profitability and thinking in a different perspective

Quite often ideas are generated that you have not thought of before

Option 1 Option 2 Option 3 Option 4

Do nothing – get a job

Start up business as a sole trader and grow the business in 3 phases

Start up business as a partnership and grow the business in 1 year

Purchase franchise in short term to raise funding

Sell online, low risk ebay etc

Sell online Sell online and in shops

Business to business direct sales

Feasibility study v PID

Feasibility Study Report

• For feasibility, typical headings are:1. Executive summary2. Description of products and services3. Technology considerations4. Marketplace5. Marketing strategy6. Organisation and staff7. Implementation8. Financial forecasts9. Findings and recommendations

PID / Business Case

• The PID focuses more on the impact/benefits of the project, including outputs and outcomes

• More strategically focussed, less marketing

• Cost, time, resources are key focus• Implementation of the project and

the lifecycle process fundamental

http://www.projectmanagementdocs.com/project-initiation-templates/feasibility-study.html