ACT 01
Case Study 1.1 MegaTech, Inc.
MegaTech, Inc. is designed to highlight some of the reasons why an organization that had operated in a relatively stable and predictable environment would seek to move to an emphasis on project-based work. The trigger event, in this case is the advent of the NAFTA treaty, which opened up competition on a more price-competitive basis.
Questions
What is it about project management that offers MegaTech a competitive advantage in its industry?
What elements of the marketplace in which MegaTech operates led the firm to believe that project management would improve its operations?
List of Cases by Chapter
Chapter 1
Development Projects in Lagos, Nigeria 2
Throwing Good Money after Bad: the BBCs
Digital Media Initiative 10
MegaTech, Inc. 29
The IT Department at Hamelin Hospital 30
Disneys Expedition Everest 31
Rescue of Chilean Miners 32
Chapter 2
Teslas $5 Billion Gamble 37
Electronic Arts and the Power of Strong Culture
in Design Teams 64
Rolls-Royce Corporation 67
Classic Case: Paradise LostThe Xerox Alto 68
Project Task Estimation and the Culture of Gotcha! 69
Widgets R Us 70
Chapter 3
Project Selection Procedures: A Cross-Industry
Sampler 77
Project Selection and Screening at GE: The Tollgate
Process 97
Keflavik Paper Company 111
Project Selection at Nova Western, Inc. 112
Chapter 4
Leading by Example for the London Olympics
Sir John Armitt 116
Dr. Elattuvalapil Sreedharan, Indias Project
Management Guru 126
The Challenge of Managing Internationally 133
In Search of Effective Project Managers 137
Finding the Emotional Intelligence to Be a Real Leader 137
Problems with John 138
Chapter 5
We look like fools.Oregons Failed Rollout
of Its ObamacareWeb Site 145
Statements of Work: Then and Now 151
Defining a Project Work Package 163
Boeings Virtual Fence 172
Californias High-Speed Rail Project 173
Project Management at Dotcom.com 175
The Expeditionary Fighting Vehicle 176
Chapter 6
Engineers Without Borders: Project Teams Impacting
Lives 187
Tele-Immersion Technology Eases the Use of Virtual
Teams 203
Columbus Instruments 215
The Bean Counter and the Cowboy 216
Johnson & Rogers Software Engineering, Inc. 217
Chapter 7
The Building that Melted Cars 224
Bank of America Completely Misjudges Its Customers 230
Collapse of Shanghai Apartment Building 239
Classic Case: de Havillands Falling Comet 245
The Spanish Navy Pays Nearly $3 Billion for a Submarine
That Will Sink Like a Stone 248
Classic Case: Tacoma Narrows Suspension Bridge 249
Chapter 8
Sochi OlympicsWhats the Cost of National
Prestige? 257
The Hidden Costs of Infrastructure ProjectsThe Case
of Building Dams 286
Bostons Central Artery/Tunnel Project 288
Chapter 9
After 20 Years and More Than $50 Billion, Oil is No Closer
to the Surface: The Caspian Kashagan Project 297
Chapter 10
Enlarging the Panama Canal 331
Project Scheduling at Blanque Cheque Construction (A) 360
Project Scheduling at Blanque Cheque Construction (B) 360
Chapter 11
Developing Projects Through KickstarterDo Delivery
Dates Mean Anything? 367
Eli Lilly Pharmaceuticals and Its Commitment to Critical
Chain Project Management 385
Its an Agile World 396
Ramstein Products, Inc. 397
Chapter 12
Hong Kong Connects to the Worlds Longest Natural
Gas Pipeline 401
The Problems of Multitasking 427
Chapter 13
New York Citys CityTime Project 432
Earned Value at Northrop Grumman 451
The IT Department at Kimble College 463
The Superconducting Supercollider 464
Boeings 787 Dreamliner: Failure to Launch 465
Chapter 14
Duke Energy and Its Cancelled Levy County Nuclear
Power Plant 478
Aftermath of a Feeding Frenzy: Dubai and Cancelled
Construction Projects 490
New Jersey Kills Hudson River Tunnel Project 497
The Project That Wouldnt Die 499
The Navy Scraps Development of Its Showpiece
WarshipUntil the Next Bad Idea 500
Project ManageMent
achieving coMPetitive advantage
Jeffrey K. Pinto
Pennsylvania State University
Boston Columbus Indianapolis New York San Francisco Hoboken Amsterdam
Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi
Mexico City So Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo
F o u r t h E d i t i o n
To Mary Beth, my wife, with the most profound thanks and love for her unwavering
support. And, to our children, Emily, AJ, and Josephthree projects that are definitely
over budget but that are performing far better than I could have hoped!
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Project Manager: Nicole Suddeth
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Library of Congress Cataloging-in-Publication Data
Pinto, Jeffrey K.
Project management : achieving competitive advantage/Jeffrey K. Pinto.Fourth edition.
pages cm
Includes index.
ISBN 978-0-13-379807-4 (alk. paper)ISBN 0-13-379807-0 (alk. paper) 1. Project management. I. Title.
HD69.P75P5498 2016
658.4’04dc23
2014036595
10 9 8 7 6 5 4 3 2 1
ISBN 10: 0-13-379807-0
ISBN 13: 978-0-13-379807-4
http://www.pearsoned.com/permissions/
iii
BrIEF COnTEnTS
Preface xiii
Chapter 1 Introduction: Why Project Management? 1
Chapter 2 The Organizational Context: Strategy, Structure, and Culture 36
Chapter 3 Project Selection and Portfolio Management 76
Chapter 4 Leadership and the Project Manager 115
Chapter 5 Scope Management 144
Chapter 6 Project Team Building, Conflict, and Negotiation 186
Chapter 7 Risk Management 223
Chapter 8 Cost Estimation and Budgeting 256
Chapter 9 Project Scheduling: Networks, Duration Estimation,
and Critical Path 296
Chapter 10 Project Scheduling: Lagging, Crashing, and Activity Networks 330
Chapter 11 Advanced Topics in Planning and Scheduling: Agile
and Critical Chain 366
Chapter 12 Resource Management 400
Chapter 13 Project Evaluation and Control 431
Chapter 14 Project Closeout and Termination 477
Appendix A The Cumulative Standard Normal Distribution 509
Appendix B Tutorial for MS Project 2013 510
Appendix C Project Plan Template 520
Glossary 524
Company Index 534
Name Index 535
Subject Index 538
iv
COnTEnTS
Preface xiii
Chapter 1 IntroduCtIon: Why ProjeCt ManageMent? 1
Project Profile: Development Projects in Lagos, Nigeria 2
Introduction 4
1.1 What Is a Project? 5
General Project Characteristics 6
1.2 Why Are Projects Important? 9
Project Profile: Throwing Good Money after Bad: the BBCs Digital
Media Initiative 10
1.3 Project Life Cycles 13
Box 1.1: Project Managers in Practice 15
1.4 Determinants of Project Success 16
Box 1.2: Project Management Research in Brief 19
1.5 Developing Project Management Maturity 19
1.6 Project Elements and Text Organization 23
Summary 27 KeyTerms 29 DiscussionQuestions 29
Case Study 1.1 MegaTech,Inc. 29 Case Study 1.2 The IT
DepartmentatHamelinHospital 30 Case Study 1.3 Disneys Expedition
Everest 31 Case Study 1.4RescueofChileanMiners 32 Internet
Exercises 33 PMPCertificationSampleQuestions 34 Notes 34
Chapter 2 the organIzatIonal Context: Strategy, StruCture,
and Culture 36
Project Profile: Teslas $5 Billion Gamble 37
Introduction 38
2.1 Projects and Organizational Strategy 39
2.2 Stakeholder Management 41
Identifying Project Stakeholders 42
Managing Stakeholders 45
2.3 Organizational Structure 47
2.4 Forms of Organizational Structure 48
Functional Organizations 48
Project Organizations 50
Matrix Organizations 53
Moving to Heavyweight Project Organizations 55
Box 2.1: Project Management Research in Brief 56
2.5 Project Management Offices 57
2.6 Organizational Culture 59
How Do Cultures Form? 61
Organizational Culture and Project Management 63
Project Profile: Electronic Arts and the Power of Strong Culture in Design Teams 64
Summary 65 KeyTerms 67 DiscussionQuestions 67 Case
Study 2.1 Rolls-RoyceCorporation 67 Case Study 2.2 Classic Case:
ParadiseLostTheXeroxAlto 68 Case Study 2.3 Project Task Estimation
andtheCultureofGotcha! 69 Case Study 2.4 Widgets R Us 70
InternetExercises 70 PMPCertificationSampleQuestions 70
IntegratedProjectBuildingYourProjectPlan 72 Notes 74
Contents v
Chapter 3 ProjeCt SeleCtIon and PortfolIo ManageMent 76
Project Profile: Project Selection Procedures: A Cross-Industry Sampler 77
Introduction 78
3.1 Project Selection 78
3.2 Approaches to Project Screening and Selection 80
Method One: Checklist Model 80
Method Two: Simplified Scoring Models 82
Limitations of Scoring Models 84
Method Three: The Analytical Hierarchy Process 84
Method Four: Profile Models 88
3.3 Financial Models 90
Payback Period 90
Net Present Value 92
Discounted Payback 94
Internal Rate of Return 94
Choosing a Project Selection Approach 96
Project Profile: Project Selection and Screening at GE: The Tollgate Process 97
3.4 Project Portfolio Management 98
Objectives and Initiatives 99
Developing a Proactive Portfolio 100
Keys to Successful Project Portfolio Management 103
Problems in Implementing Portfolio Management 104
Summary 105 KeyTerms 106 SolvedProblems 107
DiscussionQuestions 108 Problems 108 Case Study 3.1
KeflavikPaperCompany 111 Case Study 3.2 Project Selection at Nova
Western,Inc. 112 InternetExercises 113 Notes 113
Chapter 4 leaderShIP and the ProjeCt Manager 115
Project Profile: Leading by Example for the London OlympicsSir John Armitt 116
Introduction 117
4.1 Leaders Versus Managers 118
4.2 How the Project Manager Leads 119
Acquiring Project Resources 119
Motivating and Building Teams 120
Having a Vision and Fighting Fires 121
Communicating 121
Box 4.1: Project Management Research in Brief 124
4.3 Traits of Effective Project Leaders 125
Conclusions about Project Leaders 126
Project Profile: Dr. Elattuvalapil Sreedharan, Indias Project Management Guru 126
4.4 Project Champions 127
ChampionsWho Are They? 128
What Do Champions Do? 129
How to Make a Champion 130
4.5 The New Project Leadership 131
Box 4.2: Project Managers in Practice 132
Project Profile: The Challenge of Managing Internationally 133
4.6 Project Management Professionalism 134
vi Contents
Summary 135 KeyTerms 136 DiscussionQuestions 136
Case Study 4.1 In Search of Effective Project Managers 137
Case Study 4.2 Finding the Emotional Intelligence to Be a Real Leader 137
Case Study 4.3 ProblemswithJohn 138 InternetExercises 141
PMPCertificationSampleQuestions 141 Notes 142
Chapter 5 SCoPe ManageMent 144
Project Profile: We look like fools.Oregons Failed Rollout of Its Obamacare
WebSite 145
Introduction 146
5.1 Conceptual Development 148
The Statement of Work 150
The Project Charter 151
Project Profile: Statements of Work: Then and Now 151
5.2 The Scope Statement 153
The Work Breakdown Structure 153
Purposes of the Work Breakdown Structure 154
The Organization Breakdown Structure 159
The Responsibility Assignment Matrix 160
5.3 Work Authorization 161
Project Profile: Defining a Project Work Package 163
5.4 Scope Reporting 164
Box 5.1: Project Management Research in Brief 165
5.5 Control Systems 167
Configuration Management 167
5.6 Project Closeout 169
Summary 170 KeyTerms 171 DiscussionQuestions 171
Problems 172 Case Study 5.1 Boeings Virtual Fence 172
Case Study 5.2 CaliforniasHigh-SpeedRailProject 173 Case
Study5.3 ProjectManagementatDotcom.com 175 Case Study 5.4
TheExpeditionaryFightingVehicle 176 InternetExercises 178
PMPCertificationSampleQuestions 178 MSProjectExercises 179
Appendix5.1:SampleProjectCharter 180 IntegratedProject
DevelopingtheWorkBreakdownStructure 182 Notes 184
Chapter 6 ProjeCt teaM BuIldIng, ConflICt, and negotIatIon 186
Project Profile: Engineers Without Borders: Project Teams Impacting Lives 187
Introduction 188
6.1 Building the Project Team 189
Identify Necessary Skill Sets 189
Identify People Who Match the Skills 189
Talk to Potential Team Members and Negotiate with Functional Heads 189
Build in Fallback Positions 191
Assemble the Team 191
6.2 Characteristics of Effective Project Teams 192
A Clear Sense of Mission 192
A Productive Interdependency 192
Cohesiveness 193
Trust 193
Enthusiasm 193
Results Orientation 194
Contents vii
6.3 Reasons Why Teams Fail 194
Poorly Developed or Unclear Goals 194
Poorly Defined Project Team Roles and Interdependencies 194
Lack of Project Team Motivation 195
Poor Communication 195
Poor Leadership 195
Turnover Among Project Team Members 196
Dysfunctional Behavior 196
6.4 Stages in Group Development 196
Stage One: Forming 197
Stage Two: Storming 197
Stage Three: Norming 198
Stage Four: Performing 198
Stage Five: Adjourning 198
Punctuated Equilibrium 198
6.5 Achieving Cross-Functional Cooperation 199
Superordinate Goals 199
Rules and Procedures 200
Physical Proximity 201
Accessibility 201
Outcomes of Cooperation: Task and Psychosocial Results 201
6.6 Virtual Project Teams 202
Project Profile: Tele-Immersion Technology Eases the Use
of Virtual Teams 203
6.7 ConflictManagement 204
What Is Conflict? 205
Sources of Conflict 206
Methods for Resolving Conflict 208
6.8 Negotiation 209
Questions to Ask Prior to the Negotiation 209
Principled Negotiation 210
Invent Options for Mutual Gain 212
Insist on Using Objective Criteria 213
Summary 214 KeyTerms 214 DiscussionQuestions 215 Case
Study 6.1 ColumbusInstruments 215 Case Study 6.2 The Bean Counter
andtheCowboy 216 Case Study 6.3 Johnson & Rogers Software
Engineering,Inc. 217 ExerciseinNegotiation 219 Internet
Exercises 220 PMPCertificationSampleQuestions 220 Notes 221
Chapter 7 rISk ManageMent 223
Project Profile: The Building that Melted Cars 224
Introduction 225
Box 7.1: Project Managers in Practice 227
7.1 Risk Management: A Four-Stage Process 228
Risk Identification 228
Project Profile: Bank of America Completely Misjudges Its Customers 230
Risk Breakdown Structures 231
Analysis of Probability and Consequences 231
Risk Mitigation Strategies 234
viii Contents
Use of Contingency Reserves 236
Other Mitigation Strategies 237
Control and Documentation 237
Project Profile: Collapse of Shanghai Apartment Building 239
7.2 Project Risk Management: An Integrated Approach 241
Summary 243 KeyTerms 244 SolvedProblem 244 Discussion
Questions 244 Problems 244 Case Study 7.1 Classic Case: de
HavillandsFallingComet 245 Case Study 7.2 The Spanish Navy Pays
Nearly$3BillionforaSubmarineThatWillSinkLikeaStone 248 Case
Study 7.3 ClassicCase:TacomaNarrowsSuspensionBridge 249 Internet
Exercises 251 PMPCertificationSampleQuestions 251 Integrated
ProjectProjectRiskAssessment 253 Notes 255
Chapter 8 CoSt eStIMatIon and BudgetIng 256
Project Profile: Sochi OlympicsWhats the Cost of National Prestige? 257
8.1 Cost Management 259
Direct Versus Indirect Costs 260
Recurring Versus Nonrecurring Costs 261
Fixed Versus Variable Costs 261
Normal Versus Expedited Costs 262
8.2 Cost Estimation 262
Learning Curves in Cost Estimation 266
Box 8.1: Project Management Research in Brief 270
Problems with Cost Estimation 272
Box 8.2: Project Management Research in Brief 274
8.3 Creating a Project Budget 275
Top-Down Budgeting 275
Bottom-Up Budgeting 276
Activity-Based Costing 276
8.4 Developing Budget Contingencies 278
Summary 280 KeyTerms 281 SolvedProblems 282
DiscussionQuestions 283 Problems 284 Case Study 8.1 The
Hidden Costs of Infrastructure ProjectsThe Case of Building Dams 286
Case Study 8.2 BostonsCentralArtery/TunnelProject 288 Internet
Exercises 290 PMPCertificationSampleQuestions 290 Integrated
ProjectDevelopingtheCostEstimatesandBudget 292 Notes 294
Chapter 9 ProjeCt SChedulIng: netWorkS, duratIon eStIMatIon,
and CrItICal Path 296
Project Profile: After 20 Years and More Than $50 Billion, Oil is No Closer to the Surface:
The Caspian Kashagan Project 297
Introduction 298
9.1 Project Scheduling 299
9.2 KeySchedulingTerminology 300
9.3 Developing a Network 302
Labeling Nodes 303
Serial Activities 303
Concurrent Activities 303
Merge Activities 304
Burst Activities 305
9.4 Duration Estimation 307
Contents ix
9.5 Constructing the Critical Path 311
Calculating the Network 311
The Forward Pass 312
The Backward Pass 314
Probability of Project Completion 316
Laddering Activities 318
Hammock Activities 319
Options for Reducing the Critical Path 320
Box 9.1: Project Management Research in Brief 321
Summary 322 KeyTerms 323 SolvedProblems 323
DiscussionQuestions 325 Problems 325 Internet
Exercises 327 MSProjectExercises 328 PMPCertification
SampleQuestions 328 Notes 329
Chapter 10 ProjeCt SChedulIng: laggIng, CraShIng, and aCtIvIty
netWorkS 330
Project Profile: Enlarging the Panama Canal 331
Introduction 333
10.1 Lags in Precedence Relationships 333
Finish to Start 333
Finish to Finish 334
Start to Start 334
Start to Finish 335
10.2 Gantt Charts 335
Adding Resources to Gantt Charts 337
Incorporating Lags in Gantt Charts 338
Box 10.1: Project Managers in Practice 338
10.3 Crashing Projects 340
Options for Accelerating Projects 340
Crashing the Project: Budget Effects 346
10.4 Activity-on-Arrow Networks 348
How Are They Different? 348
Dummy Activities 351
Forward and Backward Passes with AOA Networks 352
AOA Versus AON 353
10.5 Controversies in the Use of Networks 354
Conclusions 356
Summary 356 KeyTerms 357 SolvedProblems 357 Discussion
Questions 358 Problems 358 Case Study 10.1 Project Scheduling
atBlanqueChequeConstruction(A) 360 Case Study 10.2 Project
SchedulingatBlanqueChequeConstruction(B) 360 MSProject
Exercises 361 PMPCertificationSampleQuestions 361 Integrated
ProjectDevelopingtheProjectSchedule 363 Notes 365
Chapter 11 advanCed toPICS In PlannIng and SChedulIng: agIle
and CrItICal ChaIn 366
Project Profile: Developing Projects Through KickstarterDo Delivery Dates Mean
Anything? 367
Introduction 368
11.1 Agile Project Management 369
What Is Unique About Agile PM? 370
x Contents
Tasks Versus Stories 371
Key Terms in Agile PM 372
Steps in Agile 373
Sprint Planning 374
Daily Scrums 374
The Development Work 374
Sprint Reviews 375
Sprint Retrospective 376
Problems with Agile 376
Box 11.1: Project Management Research in Brief 376
11.2 Extreme Programming (XP) 377
11.3 The Theory of Constraints and Critical Chain Project Scheduling 377
Theory of Constraints 378
11.4 The Critical Chain Solution to Project Scheduling 379
Developing the Critical Chain Activity Network 381
Critical Chain Solutions Versus Critical Path Solutions 383
Project Profile: Eli Lilly Pharmaceuticals and Its Commitment to Critical Chain Project
Management 385
11.5 CriticalChainSolutionstoResourceConflicts 386
11.6 Critical Chain Project Portfolio Management 387
Box 11.2: Project Management Research in Brief 390
11.7 Critiques of CCPM 391
Summary 391 KeyTerms 393 SolvedProblem 393
DiscussionQuestions 394 Problems 394 Case Study 11.1 Its an
AgileWorld 396 Case Study 11.2 Ramstein Products, Inc. 397
InternetExercises 398 Notes 398
Chapter 12 reSourCe ManageMent 400
Project Profile: Hong Kong Connects to the Worlds Longest Natural
Gas Pipeline 401
Introduction 402
12.1 The Basics of Resource Constraints 402
Time and Resource Scarcity 403
12.2 Resource Loading 405
12.3 Resource Leveling 407
Step One: Develop the Resource-Loading Table 411
Step Two: Determine Activity Late Finish Dates 412
Step Three: Identify Resource Overallocation 412
Step Four: Level the Resource-Loading Table 412
12.4 Resource-Loading Charts 416
Box 12.1: Project Managers in Practice 418
12.5 Managing Resources in Multiproject Environments 420
Schedule Slippage 420
Resource Utilization 420
In-Process Inventory 421
Resolving Resource Decisions in Multiproject Environments 421
Summary 423 KeyTerms 424 SolvedProblem 424
DiscussionQuestions 425 Problems 425 Case Study 12.1 The
ProblemsofMultitasking 427 InternetExercises 428 MSProject
Exercises 428 PMPCertificationSampleQuestions 429 Integrated
ProjectManagingYourProjectsResources 430 Notes 430
Contents xi
Chapter 13 ProjeCt evaluatIon and Control 431
Project Profile: New York Citys CityTime Project 432
Introduction 433
13.1 Control CyclesA General Model 434
13.2 Monitoring Project Performance 435
The Project S-Curve: A Basic Tool 435
S-Curve Drawbacks 436
Milestone Analysis 437
Problems with Milestones 438
The Tracking Gantt Chart 439
Benefits and Drawbacks of Tracking Gantt Charts 440
13.3 Earned Value Management 440
Terminology for Earned Value 441
Creating Project Baselines 442
Why Use Earned Value? 443
Steps in Earned Value Management 444
Assessing a Projects Earned Value 445
13.4 Using Earned Value to Manage a Portfolio of Projects 450
Project Profile: Earned Value at Northrop Grumman 451
13.5 Issues in the Effective Use of Earned Value Management 452
13.6 Human Factors in Project Evaluation and Control 454
Critical Success Factor Definitions 456
Conclusions 458
Summary 458 KeyTerms 459 SolvedProblem 459
DiscussionQuestions 460 Problems 461 Case Study 13.1 The
ITDepartmentatKimbleCollege 463 Case Study 13.2 The Supercon-
ductingSupercollider 464 Case Study 13.3 Boeings 787 Dreamliner:
FailuretoLaunch 465 InternetExercises 468 MSProject
Exercises 468 PMPCertificationSampleQuestions 469
Appendix13.1:EarnedSchedule* 470 Notes 475
Chapter 14 ProjeCt CloSeout and terMInatIon 477
Project Profile: Duke Energy and Its Cancelled Levy County Nuclear
Power Plant 478
Introduction 479
14.1 Types of Project Termination 480
Box 14.1: Project Managers in Practice 480
14.2 Natural TerminationThe Closeout Process 482
Finishing the Work 482
Handing Over the Project 482
Gaining Acceptance for the Project 483
Harvesting the Benefits 483
Reviewing How It All Went 483
Putting It All to Bed 485
Disbanding the Team 486
What Prevents Effective Project Closeouts? 486
14.3 Early Termination for Projects 487
Making the Early Termination Decision 489
Project Profile: Aftermath of a Feeding Frenzy: Dubai and Cancelled
Construction Projects 490
xii Contents
Shutting Down the Project 490
Box 14.2: Project Management Research in Brief 492
Allowing for Claims and Disputes 493
14.4 Preparing the Final Project Report 494
Conclusion 496
Summary 496 KeyTerms 497 DiscussionQuestions 497
Case Study 14.1 NewJerseyKillsHudsonRiverTunnelProject 497
Case Study 14.2 TheProjectThatWouldntDie 499 Case Study 14.3
The Navy Scraps Development of Its Showpiece WarshipUntil the Next
BadIdea 500 InternetExercises 501 PMPCertificationSample
Questions 502 Appendix14.1:SamplePagesfromProjectSign-off
Document 503 Notes 507
Appendix A The Cumulative Standard Normal Distribution 509
Appendix B Tutorial for MS Project 2013 510
Appendix C Project Plan Template 520
Glossary 524
Company Index 534
Name Index 535
Subject Index 538
xiii
PrEFACE
Project management has become central to operations in industries as diverse as construction
and information technology, architecture and hospitality, and engineering and new product
development; therefore, this text simultaneously embraces the general principles of project
management while addressing specific examples across the wide assortment of its applications.
This text approaches each chapter from the perspective of both the material that is general to
all disciplines and project types and that which is more specific to alternative forms of projects.
One way this is accomplished is through the use of specific, discipline-based examples to illus-
trate general principles as well as the inclusion of cases and Project Profiles that focus on more
specific topics (e.g., Chapter 5s treatment of IT death march projects).
Students in project management classes come from a wide and diverse cross section of uni-
versity majors and career tracks. Schools of health, business, architecture, engineering, information
systems, and hospitality are all adding project management courses to their catalogs in response to
the demands from organizations and professional groups that see their value for students future
careers. Why has project management become a discipline of such tremendous interest and applica-
tion? The simple truth is that we live in a projectized world. Everywhere we look we see people
engaged in project management. In fact, project management has become an integral part of practi-
cally every firms business model.
This text takes a holistic, integrated approach to managing projects, exploring both technical
and managerial challenges. It not only emphasizes individual project execution, but also provides a
strategic perspective, demonstrating the means with which to manage projects at both the program
and portfolio levels.
At one time, project management was almost exclusively the property of civil and con-
struction engineering programs where it was taught in a highly quantitative, technical man-
ner. Master the science of project management, we once argued, and the art of project
management will be equally clear to you. Project management today is a complex, manage-
ment challenge requiring not only technical skills but a broad-based set of people skills as
well. Project management has become the management of technology, people, culture, stake-
holders, and other diverse elements necessary to successfully complete a project. It requires
knowledge of leadership, team building, conflict resolution, negotiation, and influence in equal
measure with the traditional, technical skill set. Thus, this textbook broadens our focus beyond
the traditional project management activities of planning and scheduling, project control, and
termination, to a more general, inclusive, and, hence, more valuable perspective of the project
management process.
Whats NeW iN the foUrth editioN?
New features
Agile Project Management
Project Charters
MS Project 2013 Step-by-Step Tutorials
AppendixProject Execution Plan Template
New Project Managers in Practice Profiles
Risk Breakdown Structures
Extreme Programming
Updated Problems in Chapters
New Project Management Research in Brief: Does Agile Work?
All MS Project Examples and Screen Captures Updated to MS Project 2013
All Project Management Body of Knowledge (PMBOK) Referencing Updated to
5th Edition
Quarterly Updates for All Book Adopters on Latest Cases and Examples in Project
Management
Updated Project Profiles
Chapter 1 Introduction: Why Project Management?
Development Projects in Lagos, Nigeria
Throwing Good Money after Bad: The BBCs Digital Media Initiative
Chapter 2 The Organizational Context: Strategy, Structure, and Culture
Teslas $5 Billion Gamble
Electronic Arts and the Power of Strong Culture in Design Teams
Chapter 3 Project Selection and Portfolio Management
Project Selection Procedures: A Cross-Industry Sampler
Chapter 4 Leadership and the Project Manager
Leading by Example for the London OlympicsSir John Armitt
Dr. E. Sreedharan, Indias Project Management Guru
Chapter 5 Scope Management
We look like fools. Oregons Failed Rollout of Their Obamacare Website
Boeings Virtual Fence
Californias High-Speed Rail ProjectWhats the Latest News?
The Expeditionary Fighting Vehicle
Chapter 6 Project Team Building, Conflict, and Negotiation
Engineers without Borders: Project Teams Impacting Lives
Chapter 7 Risk Management
The Building That Melted Cars
Bank of America Completely Misjudges Its Customers
Collapse of Shanghai Apartment Building
The Spanish Navy Pays Nearly $3 Billion for a Submarine That Will Sink Like a Stone
Chapter 8 Cost Estimation and Budgeting
Sochi OlympicsWhats the Cost of National Prestige?
The Hidden Costs of Infrastructure ProjectsThe Case of Building Dams
Chapter 9 Project Scheduling: Networks, Duration Estimation, and Critical Path
After 20 Years and More than $50 Billion, Oil Is No Closer to the Surface: The Caspian
Kashagan Project
Chapter 10 Project Scheduling: Lagging, Crashing, and Activity Networks
Enlarging the Panama Canal
Chapter 11 Critical Chain Project Scheduling
Developing Projects through KickstarterDo Delivery Dates Mean Anything?
Eli Lilly Pharmaceuticals Commitment to Critical Chain Project Scheduling
Chapter 12 Resource Management
Hong Kong Connects to the Worlds Longest Natural Gas Pipeline
Chapter 13 Project Evaluation and Control
New York Citys CityTime Project
Boeings 787 Dreamliner: Failure to Launch (with update)
Earned Value Management at Northrop Grumman
Chapter 14 Project Closeout and Termination
Duke Energy and Its Cancelled Levy County Nuclear Power Plant
Aftermath of a Feeding FrenzyDubai and Cancelled Construction Projects
New Jersey Kills Hudson River Tunnel Project
The Navy Scraps Development of Its Showpiece WarshipUntil the Next Bad Idea
oUr focUs
This textbook employs a managerial, business-oriented approach to the management of projects.
Thus we have integrated Project Profiles into the text.
Project ProfilesEach chapter contains one or more Project Profiles that highlight cur-
rent examples of project management in action. Some of the profiles reflect on significant
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Preface xv
achievements; others detail famous (and not-so-famous) examples of
