Project Management: Definitions, Terms, Examples

Map Ilustrating the Idea of Project Management: Definitions, Terms, Examples
Photo by Element5 Digital on Unsplash

One of the main problems that a project manager can encounter in his activity is to change parts of the project at the requirement of the client during the unfolding of the project. This change not only affects the general progress of the activity, but it also impairs the schedule of the project, threatening impossibility of meeting the deadline. Such situations illustrate why project management is highly needed.

The Project Management Institute defines project management as a type of activity in which people apply their knowledge, existing skills and tools or techniques in order to meet the requirements involved by a particular project that they endeavor to realize (PMBOK Guide, 3rd Edition, Project Management Institute Inc., Pennsylvania, 2004).

According to a different definition, project management involves those activities through which a project can be realized on time, spending the money provided for in a budget and offering the expected results and quality.

When speaking about project management, definitions, terms, and examples are important means to facilitate understanding.

The Balance Quadrant

Project management includes several terms, among them, are the following: project, time, budget, scope, quality. A project involves an activity intended to make a non-repeatable change in an existing situation. Thus, to create a new journal is a project whereas to publish it regularly is not.

Time refers to the period of time that a project needs to be realized, and budget to the money spent on the activities and inputs required by the project. Thus, a project could be finished in five months, spending a budget of $10,000.

Quality regards the way in which the project is conducted, as well as the quality of the end-product, which matches the features presented in the initial plan.

And finally, scope means the range of activities and the number of deliverables necessary to implement the original plan.

The four elements (time, budget, scope, and quality) mentioned above build the so-called balance quadrant. In this quadrant, each element is tightly related to the others so that a change of one of them leads to a change of all the others and finally to a modification of the entire project. Thus, for example, an extension of time might imply an increase in costs and scope, which can be accompanied by a diminishing of quality, ultimately the whole project being affected.

Phases of a Project

Each project has a life-cycle which can be divided into the following phases: a) Initiating the project; b) Implementing the project (this phase includes Planning, Executing and Controlling the activity); and c) the Closing phase. Although the phase containing the implementation of the project is the longest, everyone being occupied with realizing the attributed tasks, the most important stages are the initiation, planning and closing of the project.

In the initiation phase, the focus must be oriented toward the way in which the team acts. Thus, the project manager must make all the members understand precisely the nature of the project and their role in it, so that they can successfully accomplish their tasks. We can imagine that a team inadequately instructed could produce more damage than useful results.

Also in this phase, a good identification of all stakeholders is necessary. The stakeholders are those persons or entities that are involved or interested one way or another in the project. For example, if you open a boutique on the ground floor of an apartment building, and do not appropriately inform the inhabitants, you could run the risk that after you started your business these inhabitants will not agree with the nature of your activity, and ask you to close it. Or they might agree, but consider that they too must get an advantage from your activity and request a certain percent of your earnings, which would make your economic activity unprofitable.

Teamwork
Photo by You X Ventures on Unsplash

Planning is also very important because in this phase you establish all the steps that mark the implementation of the project. A plan is like a map that shows you the direction, the path that you must follow in order to attain a certain goal. However, unlike the map, the plan must be flexible, i.e. you must anticipate that, during the implementation, unknown and unexpected things can happen which would hinder your activity. Unless these unexpected factors have a destructive character, you must adapt to them and modify your initial plan so that now you take them into account.

For example, the boutique that you opened is confronted with the bankruptcy of one of your merchandise providers. You must be immediately able to find another one so that your activity is not very much affected. On the other hand, when planning to open a shop, you must research very well the conditions in which you can acquire your merchandise and who are your suppliers. You must choose well-established companies, in which you can trust that they will not collapse and disappear overnight or that they will change too often the contractual conditions.

Not only must your suppliers be taken into consideration, but especially your customers too. You must research initially who your customers are, where you can find them and what their profile is. That is to say, you must know very well your niche market. If your shop addresses customers aged between 20 and 30, but it is located in an area where the inhabitants are mostly over 40, then certainly you cannot expect to have a successful business. You could have known this long before going broke by having done some research and having planned adequately.

The Closing phase is also very important. If you are not able to close the project successfully, many adverse consequences could drag on into your future activity. For example, you started the business, but you did not have enough money to advertise it properly. It could happen that your clientele will build up very slowly and this will lead to difficulties in covering your initial expenses, which then will roll over to the next acquisition of commodities.

Using Your Creativity

Projects are prefaced by the activity of discovering what is the best idea to develop through a project. Everyone can see that this activity involves a lot of creativity because no two persons will agree about the prospects of a project. For one person the idea of opening a shoe shop in a certain area would seem disastrous, whereas for the other it would appear as a brilliant idea.

Everything depends on the experience, vision, and enthusiasm of the involved persons. Also, it depends on what is called portfolio planning. This term refers to the capabilities and resources that a person or a company has that support the future project activity. If you inherit some money and want to open a computer shop, but you have no experience and knowledge in this domain, you will end up spending most or even all the money without any success.

The same is true if you ignore the fact that commodities need to be deposited in an adequate storehouse that you either own or you rent. If your storehouse is too small and you have not enough money to rent a bigger one, then your portfolio is not adequate for this type of business.

Man Beholding Graphs on a Paper
Photo by William Iven on Unsplash

Projects and Opportunities

It’s natural to assume that the process of discovery involves seizing opportunities. Every discovery is associated with an existing interest and only when something is seen as being able to satisfy that interest will it be seen as an opportunity. Once you have an interest, you may discover several opportunities to meet it. Then you will have to choose among those opportunities the one that matches in the best way your interest and your portfolio as well.

For example, you are a company that is interested in improving its activity. This can be done either by discovering new markets or by decreasing costs or by improving productivity. Then you will search for opportunities through which you can do this. The growing activity might involve an increase in the number of employees. However, the place where your company is situated doesn’t allow you to make this change due to the high wages that employees ask for.

Then you might want to open a subsidiary abroad. This could immediately ensure a decrease in costs and the possibility of opening new markets. This can be a good opportunity. But abroad could mean several countries, where the costs of labor are different. Thus, after you have identified the opportunities, you must now compare them and choose which opportunity suits you the best. When comparing these opportunities you must, therefore, take into account what the benefits are that each case offers you and what the expenses, risks or setbacks are.

The Project Proposal

After having identified an opportunity, the next step is to elaborate a project proposal. This is a short document that just outlines the future project, providing only the necessary background information as well as explaining wherein the value of undertaking the project consists and what resources it would need (what its timing, personnel need, and budget are).

It is only because there is an interest, that the discovery of an opportunity has the meaning of a possible increase in value, so that the future project adds value to the present activity of a company. Indeed, ultimately from an economic point of view, value means money.

However, until reaching the money aspect, the improvements could refer to many human aspects. For example, recently more and more companies are aware that improving their productivity is possible by assuring a better work environment for their employees. The money aspect is here tightly related to the human aspect because people working in a better environment feel better and more fulfilled. For decades, the old capitalist view of the employer who treats his employees like inanimate stuff has changed.

A Project-Based Economy

Our society is more and more oriented toward economic activities that are project-based. In order to have a good project, you must know what the opportunities are to which a project responds, as well as what the main components of the project are. This is only a first step in implementing a project, but without it, the chances are that everything could end up in confusion and getting the opposite of the expected result.

 

Leave a Reply

Your email address will not be published. Required fields are marked *