San Diego State University Acorn Industries KMIP Incentive Program Case Study 1. How should Acorn organize now, considering both their commercial business

San Diego State University Acorn Industries KMIP Incentive Program Case Study 1. How should Acorn organize now, considering both
their commercial business and their growing government
business?2. How can Acorn quickly increase its project management
maturity?
3. What should Acorn do about the KMIP incentive program?
4. Should the functional or project managers be responsible
for performance evaluations? How should Acorn handle the
positive evaluation bias by PMs?
5. As Acorn continues to grow, should it consider adopting a
matrix structure?
6. How should Ken Hawks proceed now? What should he do
first, and then what should follow? Textbook Trialware
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Project Management
A Strategic Managerial Approach
Tenth Edition
Project Management
A Strategic Managerial Approach
Tenth Edition
JACK R. MEREDITH
Broyhill Distinguished Scholar and Chair in Operations, Emeritus
Wake Forest University
SCOTT M. SHAFER
Associate Dean and Professor of Management
Wake Forest University
SAMUEL J. MANTEL, JR. (DECEASED)
Previously the Joseph S. Stern Professor Emeritus of Operations Management
University of Cincinnati
DEDICATION
To the memory of Sam Mantel, Jr.: Scholar, author, mentor, friend.
J. R. M. and S.M.S
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ISBN: 978-1-119-36909-7 (PBK)
ISBN: 978-1-119-36906-6 (EVALC)
Library of Congress Cataloging-in-Publication Data:
Names: Meredith, Jack R., author.
Title: Project management : a strategic managerial approach / JACK R.
MEREDITH, Broyhill Distinguished Scholar and Chair in Operations,
Emeritus, Wake Forest University, SCOTT M. SHAFER, Associate Dean and
Professor of Management Wake Forest University, SAMUEL J. MANTEL, JR.
(DECEASED), Previously the Joseph S. Stern Professor Emeritus of
Operations Management, University of Cincinnati.
Description: Tenth Edition. | Hoboken : Wiley, [2017] | Revised edition of
Project management, 2015. | Includes index. |
Identifiers: LCCN 2017036857 (print) | LCCN 2017040295 (ebook) | ISBN
9781119369080 (pdf) | ISBN 9781119369110 (epub) | ISBN 9781119369097
(pbk.) | ISBN 9781118947029
Subjects: LCSH: Project management.
Classification: LCC HD69.P75 (ebook) | LCC HD69.P75 M47 2017 (print) | DDC
658.4/04—dc23
LC record available at https://lccn.loc.gov/2017036857
The inside back cover will contain printing identification and country of origin if omitted from this page. In addition, if the ISBN
on the back cover differs from the ISBN on this page, the one on the back cover is correct.
Preface
Approach
We have come a long way in project management since
our cavemen ancestors formed a project, as our former
colleague Sam Mantel used to say, “to gather the raw
material for mammoth stew.” However, its use has virtually exploded since the mid-1990s. Businesses now
regularly use project management to accomplish unique
outcomes with limited resources under critical time constraints. In the service sector of the economy, the use of
project management to achieve an organization’s goals is
even more common. Advertising campaigns, voter registration drives, weddings, and even management seminars on the subject of project management are organized
as projects.
But a relatively new growth area is the use of projects as a way of accomplishing strategic organizational
changes such as new ways of providing services, typically
in conjunction with new software programs and other
advanced technologies. Transformational change on this
level is a major step beyond the delivery of a project’s outputs like a road, a building, a new product, or a computer
program. The difference is that much more attention is
directed toward both the initiation of the project, including
the business case and its non-monetary justifications, and
the utilization of the project, involving possibly customers
or other stakeholders. Moreover, the scope of strategic
transformational projects frequently involves dynamic
perturbations, meaning that the project manager and other
stakeholders have to alter course throughout the duration
of the project.
When we wrote the first edition of this textbook in
1983, there weren’t any textbooks for those interested
in learning project management, only professional (typically engineering) books, so we adopted a managerial
perspective for the book following the “life cycle” of the
project. That is, it addresses project management from the
perspective of what the project manager and other stakeholders will encounter, both chronologically during the
initiation, implementation, and utilization of the project’s
output, as well as practically, in the sense of what senior
managers and the project manager need to know and do.
This managerial life-cycle perspective, we believe,
addresses the basic nature of managing all types of projects—public, business, engineering, information systems, and so on—as well as the specific techniques and
insights required to carry out this unique way of getting
things done. It also discusses the demands made on the
project manager and the nature of the manager’s interaction with the rest of the parent organization. And the book
covers the difficult problems associated with conducting
a project using people and organizations that represent
different cultures and may be separated by considerable
distances. Finally, it even covers the issues arising when
the decision is made to close or terminate a project.
The book is primarily intended for use as a college
textbook for teaching project management at the advanced
undergraduate or master’s level. The book is also intended
for both senior managers as well as current and prospective project managers who wish to share our insights and
ideas about the field. We have drawn freely on our personal
experiences working with senior and project managers
and on the experience of friends and colleagues who have
spent much of their working lives serving in what they
like to call the “real world.” As well as being a text that is
equally appropriate for classes on the management of service, product, or engineering projects, we have found that
information systems/technology (IS/IT) students in our
classes find the material particularly helpful for managing
their projects.
Organization and Content
Given our managerial perspective, in this tenth edition we
have kept the previous organization which demarks more
clearly the activities that occur before the launch of the
project, setting up those activities that have to do with the
context (or initiation) of the project in the first part of the
book, and those that have to do with the planning for the
project in the second part. Actually executing the project
and then utilizing the outputs constitutes the third part of
the book. Each part consists of four chapters, which seems
to be a comfortable and easy framework for the reader.
Following an introductory chapter that comments
on the role and importance of projects in our society and
discusses project management as a potential career for
aspiring managers, the book covers the context, events,
and issues arising during the management of projects
in the order in which they usually occur in the life of a
project. Part I, Project Initiation concerns the context of
v
vi P RE FACE
the project, which is crucial for the project manager to
understand if he or she is to be successful in executing the
project. It begins with a description of how projects are
selected for implementation based on their tie to the organization’s strategy and goals. Part I also covers the many
roles and responsibilities of the project manager, the skills
the project manager needs for handling conflict, and the
various ways the project may be set up within the organization’s reporting structure (including how different ways
of organizing projects tend to create different problems
for project managers and their teams).
Part II, Project Planning then moves into the planning
processes starting with the major tools used in project activity
planning. This is followed by project budgeting and risk
planning, project scheduling, and finally, resource allocation
among the activities. Part III, Project Execution finally gets
into the action, beginning with monitoring the activities,
largely through information systems, and then controlling
them to assure that the results meet senior management’s
expectations. Evaluating and possibly auditing the project at
its major milestones or phase-gates is another, though separate, control action that senior management often employs,
and last, the project must be closed and its outputs utilized
to achieve the benefits desired from the project.
We have relegated the discussion of two important
aspects of projects that usually occur very early in the
project life cycle—creativity/idea generation and technological forecasting—to the book’s Web site. Although few
project managers engage in either of these tasks (typically
being appointed to project leadership after these activities
have taken place), we believe that a knowledge of these
subjects can make the project manager more effective.
In writing this text we assume that all readers have
taken an elementary course in management or have had
equivalent experience, and are familiar with some basic
principles of probability and statistics. (Appendix A on
the Web site (http://www.wiley.com/college/meredith)
can serve as an initial tutorial on the subject or as a
refresher for rusty knowledge.)
Any approach chosen to organize knowledge carries
with it an implication of neatness and order that rarely
occurs in reality. We are quite aware that projects almost
never proceed in an orderly, linear way through the stages
and events we describe here. The need to deal with change
and uncertainty is a constant task for the project manager.
We have tried to reflect this in repeated references to the
organizational, interpersonal, economic, and technical
glitches that create crises in the life cycle of every project,
and thus in the life of every project manager.
Finally, although we use a life-cycle approach to
organization, the chapters include material concerning the
major areas of the Project Management Body of Knowledge
(PMBOK®) as defined by the Project Management Institute. (See Bibliography for Chapter 1.) Anyone wishing
to prepare for PMI certification (see Chapter 1) in some
of these areas may have to go beyond the information
covered in this text.
Pedagogy
Because this book is primarily a textbook, we have included
numerous pedagogical aids to foster this purpose. As in earlier editions, short summaries appear at the end of the text
of each chapter, followed by glossaries defining key terms
and concepts introduced in the chapter. End-of-chapter
materials also include review questions and exercises revisiting the materials covered in the chapter. There are also sets
of conceptual discussion questions intended to broaden the
students’ perspectives and to force them to think beyond the
chapter materials to its implications. The answers (though
not the detailed solutions) to the even-numbered problems
are on the book’s website. To keep our attitude in perspective, we occasionally offer Dilbert® cartoons appropriate to
the topic under discussion. Finally, there are questions covering the many Project Management in Practice application
examples found throughout the chapters.
As in the past, we include incidents for discussion,
which are brief “caselettes” oriented primarily toward the
specific subjects covered in the chapter, but sometimes
materials and concepts covered in earlier chapters. We
also offer a continuing integrative class project for those
users who prefer a running case throughout the chapters
that builds on the chapter materials as students progress
through the book. And at the very end of each chapter,
we typically offer a reading and/or a case, with potential
discussion questions at the end of each.
What’s New
In this edition, we have made many updates, additions,
and changes.
• One of the major changes in this edition has been the
introduction of Organizational Project Management
??P RE FACE
in Chapter 2, including the strategic issue of governance, especially for mega-projects, as they are
now called. We describe the internal stakeholders
involved in each of the four phases of a project and
their roles and responsibilities and conclude this
discussion with a public sector example.
• Due to the increased length of Chapter 2, we cut out
some of the quantitative project selection material,
rewrote an example to focus on project selection, and
moved the last section on Project Bids and RFPs into
the section Better Cost Estimating and Bidding in
Chapter 7.
• Two significant changes are the addition of a major
section on Agile project management in Chapter 6
and a new Reading on the Evolution of Agile.
• Due to the increased length of Chapter 6, we
moved the issues of risk planning to Chapter 7 to
join the existing section there on risk simulation.
Chapter 7 also has a new reading on resilience, risk,
and agility.
• Chapter 7 also has a new Case on Fuddruckers project budgeting.
• We enhanced the existing case in Chapter 8, now
titled Nutristar Energy, Inc.
• A new follow-on case was written for Chapter 11
based on the Chapter 10 case: The Project Manager/
Customer Interface (B).
• A new section on Benefit Realization was a­ dded
in Chapter 13 to close the project in accordance with the concepts of organizational project
management.
• With all the aforementioned changes, we added some
new questions and moved summary items, questions,
glossary items, exercises, and bibliography entries,
to their new chapters.
• To supplement the new material, we added new
references to the bibliography and deleted most
of the older references before 1990, except for a
few classics.
• In the Excel spreadsheet examples, we replaced the
algebraic calculations with Excel functions.
• Finally, we updated the Dilbert cartoons.
As before, a student version of Crystal Ball®, an
Excel® add-in, again comes with the book. This software makes simulation reasonably straightforward and
vii
not particularly complicated. The use of simulation as a
technique for risk analysis is demonstrated in several ways
in different chapters. (Because relatively few students are
familiar with simulation software, step-by-step instructions are included in the text.)
Microsoft Project® has become the dominant application software in the field, outselling its closest competitor about 4 to 1. Our coverage of software tends,
therefore, to be centered on Microsoft Project® (and on
Crystal Ball®), but includes a brief discussion of the
many “add-ons” that are now available to supplement
Microsoft Project® and its competitors. Because the
various versions of Microsoft Project® are quite similar
in the way that they perform most of the basic tasks of
project management, we generally do not differentiate
between the versions, referring to any and all simply
as Microsoft Project (MSP). We have also added some
exercises to the end-of-chapter material that can utilize
computer software. Similar materials are also available
on the Web site.
There is, of course, the danger that human nature,
operating in its normal discrete mode, will shift the
task of learning project management to that of learning
project management software. Projects have often failed
because the project manager started managing the software instead of the project. Instructors need to be aware
of the problem and must caution students not to fall into
this trap.
Online Supplements
The Instructor’s Resource Guide on the Web site
www.wiley.com/college/meredith provides additional
assistance to the project management instructor. In
addition to the answers/solutions to the problems, questions, readings, and cases, this edition includes teaching
tips, a computerized test bank, additional cases, and
PowerPoint slides. All of these valuable resources are
available online (http://www.wiley.com/college/meredith).
In addition, the student Web site contains Web quizzes, PowerPoint® slides, Appendix A: Probability and
Statistics, Appendix B: Answers to Even-Numbered
Problems, Appendix C: Technological Forecasting,
Appendix D: Creativity and Idea Generation, Chapter 3
Appendix: Primer on Effective Time Management, and
a Microsoft Project Manual.
viii P RE FACE
Acknowledgments
We owe a debt of gratitude to all those who have helped us
with this book. First, we thank the managers and students
who helped us solidify our ideas about proper methods for
managing projects and proper ways of teaching the subject. Second, we thank the project teams and leaders in all
of our project management classes. Third, we…
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