MGMT627 Handouts by VUBuddy

LESSON 01

INTRODUCTION TO PROJECT MANAGEMENT

Management Key management concepts

1.1

What is Management?

Managing is an art of getting things done through and with people in formally organized groups. Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims towards any project. It is the art of creating an environment in which people can perform as individuals and yet cooperate towards the attainment of group goals.

1.1.1

Management as a Process:

According to this, management is the process of using organizational resources to achieve the organization’s goals through planning, organizing, leading, and controlling. It is thus, a set of activities directed at an organization’s resources with the aim of achieving organizational goals in an efficient and effective manner.

1.1.2 Management as People:

This refers to a group of people who engage in “Process of Management”.

1.2

Key Management Concepts:

Project Organization: It comprises of people working together and coordinating their actions to achieve specific goals. Goal: A desired future condition that the organization seeks to achieve. Resource: An asset, competency, process, skill, or knowledge controlled by organization. Various types of resources that an organization possesses are as follows: o People o Information o Machinery o Financial capital o Raw Materials

A resource is strength, if it provides an organization with a competitive advantage. On the contrary, a resource is a weakness; if it is something the organization does poorly or does not have capacity to do. Organizational resources include: Human, Physical, Financial, Technological, and Information.

1.3

Evolution of Management Concept in Modern Era:

a) Frederick Taylor – Father of Scientific Management was a Mechanical Engineer. He invented high speed steel cutting tools. He got the opportunity to know first hand problems and attitudes of the workers. Based on these he identified that in order to improve the quality of management, the major concern was to increase efficiency in production, lower cost, raise profits through higher productivity, and also increase the pays/salaries of the workforce. His message of management was to give people their best opportunities to be productive, and in turn reward workers for their individual productivity. This increase in labor productivity is not possible without the following: Providing ample rewards Adequate trainings Continuous managerial support

Thus, Fredrick Taylor concluded that “low productivity in any project is matter of ignorance on part of labor and management”.

b) Henry L. Gantt stressed the importance of “developing understanding of systems both for labor as well as management.” He emphasized that in all problems of management, human element is the most important one. Gantt gave graphic methods of describing project plans in order to have better managerial control. He highlighted the importance of time and cost in planning and controlling projects. He made the famous Gantt chart which is the forerunner of PERT.

1.4

Key Aspects of the Management Process:

The key aspects of the Management Process can be explained with the help of the following diagram:

Figure 1.1: Management Process Aspects

1.5

The process of management consists of four basic managerial functions. These are:

a) Planning:

Planning is the process of setting objectives in any project and then determining what should be done to accomplish them. It is a capstone activity of management. Managers at every level do planning. Planning activities determine an organization’s objective and based on these helps it in establishing appropriate strategies for achieving them. These strategies provide the organization with the direction and serves to obtain a match between the external environment and internal capabilities. The strategies are intended to achieve a sustained competitive advantage over the competitors.

b) Organizing:

Organizing is the process of assigning tasks, allocating resources, and arranging coordinated activities to implement plans. It involves establishing intentional structure of roles for people to fill in organizations.

c) Leading:

Leading is the process of arousing enthusiasm and directing human resource efforts toward project and organizational goals. It involves influencing people so that they contribute towards organizational and group goals. Leadership predominantly is concerned with the interpersonal aspect of managing. In projects most important problems arise from people in terms of their desires, attitudes, and behavior (as individuals as well as in groups). Thus, effective project managers also need to be effective leaders. Leadership implies follower-ship and people tend to follow those who offer means of satisfying their own needs, wishes, and desires.

d) Controlling

Controlling is the process of measuring performance and taking actions to ensure desired results in any project. It involves measuring and correcting individual as well as organizational performance to ensure that events conform to plans. Controlling facilitates accomplishment of plans. There are three basic elements that are involved in controlling. These are:

1. Management should establish standards of performance. 2. Performance should be assessed periodically and information should be updated that indicates deviation between actual versus the established standards. 3. Actions should be taken to correct performance that does not conform to the standards.

1.6

Management Functions: Planning, Organizing, Leading & Controlling:

Figure 1.2: Management Functions