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Chapter 1: Introduction

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Chapter 1: Introduction Project Management Summer 2014/2015 Dr. Nouh Alhindawi Department of Software Engineering Jordan University of Science and Technology – PowerPoint PPT presentation

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Title: Chapter 1: Introduction


1
Chapter 1 Introduction
  • Project Management
  • Summer 2014/2015
  • Dr. Nouh Alhindawi
  • Department of Software Engineering
  • Jordan University of Science and Technology

2
The project (30)(Due last day of week 5,
presentation starts at week 6, maximum 4
students per project)
  • Reports (5)
  • Two reports the first due at end of week 4
    the other end of week 8, 3-5 pages each report,
    done by each student individually (Meeting
    minutes, who is doing what, how the project
    evolving, an appraisal of the team)
  • Project document includes (10)
  • - mission and scope
  • - Statement Of Work
  • - Project charter
  • - Work Breakdown Schedule
  • - GANTT chart
  • - standards followed
  • Technical documentation (5)
  • - SDLC document
  • Presentation (5)
  • - problems you face and how you solve it
  • - success factors
  • - Failure factors
  • - lessons learned
  • Implementation (5)

3
Once upon a time...
  • Once upon a time there was a company with four
  • employees, named Everyone, Someone, Anybody
  • and Nobody. One day it became necessary to
    complete an important task.
  • Everyone was sure that Someone will do it.
    Anybody
  • could do it, but Nobody did not do it. Someone
    got angry because it was work for Everyone.
  • Everyone thought that Anybody could do it but
    Nobody
  • realized that Everyone will not do it.
  • In the end, Everyone blamed Someone that Nobody
  • did not do what Anybody could do.

4
Managers and Leaders
  • Managers are people who do things right.
  • Leaders are people who do the right thing.
  • The difference may be summarized as activities of
    vision and judgment versus activities of
    mastering routines. 

5
More about mangers and leaders
  •  The manager administers the leader innovates.
  •  The manager is a copy the leader is an
    original.
  •  The manager maintains the leader develops.
  •  The manager accepts reality the leader
    investigates it.
  •  The manager focuses on systems and structure
    the leader focuses on people.
  •  The manager relies on control the leader
    inspires trust.
  •  The manager has a short-range view the leader
    has a long-range perspective.
  •  The manager asks how and when the leader asks
    what and why.
  •  The manager has his or her eye always on the
    bottom line the leader has his or her eye on
    the horizon.
  • The manager imitates the leader originates.
  •  The manager accepts the status quo the leader
    challenges it.
  •  The manager is the classic good soldier the
    leader is his or her own person.
  •  The manager does things right the leader does
    the right thing.

6
More about mangers and leaders
  • position A person becomes a manager by his
    position. A person becomes a leader on basis of
    his personal qualities.
  • Followers The subordinates are the followers of
    managers. The group of employees whom the leaders
    leads are his followers.
  • Necessity A manager is very essential to a
    concern. A leader is required to create friendly
    and warm relation between person working in and
    for organization.
  • Functions A manager performs all five functions
    of management. Leader influences people to work
    willingly for group objectives. (Planning,
    staffing, Organizing, Directing/Leading,
    Controlling)
  • Stability It is more stable. Leadership is
    temporary.
  • Accountability Manager is accountable for self
    and subordinates behavior and performance.
    Leaders have no well defined accountability.
  • Followers People follow manager by virtue of job
    description. People follow them on voluntary
    basis.
  • Role continuation A manager can continue in
    office till he performs his duties satisfactorily
    in correspondence with organizational goals. A
    leader can maintain his position only through day
    to day wishes of followers.

7
Five functions of Management
  • Planning, It is the basic function of management.
    Planning is deciding in advance - what to do,
    when to do how to do. It bridges the gap from
    where we are where we want to be. A plan is a
    future course of actions. It is an exercise in
    problem solving decision making.
  • Staffing, It is the function of manning the
    organization structure and keeping it manned.
    Manpower, training.
  • Organizing It is the process of bringing
    together physical, financial and human resources
    and developing productive relationship amongst
    them for achievement of organizational goals.
    According to Henry Fayol, To organize a business
    is to provide it with everything useful or its
    functioning i.e. raw material, tools, capital and
    personnels.
  • Directing, Supervision, Motivation, Leadership,
    Communication
  • Controlling, The purpose of controlling is to
    ensure that everything occurs in conformities
    with the standards. An efficient system of
    control helps to predict deviations before they
    actually occur. According to Theo Haimann,
    Controlling is the process of checking whether
    or not proper progress is being made towards the
    objectives and goals and acting if necessary, to
    correct any deviation. Therefore controlling
    has following steps
  • Establishment of standard performance.
  • Measurement of actual performance.
  • Comparison of actual performance with the
    standards and finding out deviation if any.
  • Corrective action.

8
Quotes
  • Remember the difference between a boss and a
    leader a boss says "Go!" - a leader says "Let's
    go!" 
  • A chief is a man who assumes responsibility.  He
    says "I was beaten," he does not say "My men were
    beaten.
  •  
  • A leader leads by example, whether he intends to
    or not.
  • "Leadership is the art of getting someone else to
    do something you want done because he wants to do
    it."
  •   Leadership is action, not position.
  •   You don't have to hold a position in order to
    be a leader. 
  • Example is not the main thing in influencing
    others.  It is the only thing. Leaders don't
    create followers, they create more leaders. 

9
Why Project Management?
  • Better control of financial, physical, and human
    resources
  • Improved customer relations
  • Shorter development times
  • Lower costs
  • Higher quality and increased reliability
  • Higher profit margins
  • Improved productivity
  • Better internal coordination
  • Higher worker morale

10

11
Standish Group.
Project Attribute 1994 Statistics 2004 Statistics
Cancelled before completion 31 23
Missed deadline, over budget 88 51
Average cost overrun 189 45
schedule overrun 223 65
12
Latest Report of Standish Group
  • Recession-related IT budget slashing and layoffs
    are taking their toll on IT project success
    rates, according to the results of the latest
    CHAOS Summary 2009 report from The Standish
    Group
  • The Boston, Mass.-based IT project management
    research and consulting firm surveyed 400
    organizations and found a decrease in IT project
    success rates and an increase in IT Project
    Failure rates during the past two years.
    Specifically
  • - 32 percent of IT projects were
    considered successful, having been completed on
    time, on budget and with the required features
    and functions. Nearly one-in-four
  • - 24 percent IT projects were considered
    failures, having been cancelled before
  • they were completed, or having
    been delivered but never used.
  • - The rest (44 percent) were considered
    challenged They were finished late, over
  • budget, or with fewer than the
    required features and functions.

13
Project Fails for many different reasons
  • Other project take precedence
  • Team members loose sight of the purpose
  • Project managers try to do the work rather than
    lead the team
  • At the root is a fundamental problem VISION.
  • Vision in project management terms, is the
    ability to clearly see intangible and recognize
    the actions required to get there
  • One of your jobs, as PM, is to develop, nurse,
    and transfer the vision to everyone on your team.

14
Quotes in Vision
  • People only see what they are prepared to see.
  • Vision is the art of seeing what is invisible to
    others.
  • Vision without action is a dream. Action without
    vision is simply passing the time. Action with
    vision is making a positive difference.
  • There are always flowers for those who want to
    see them.
  • It's easy to see, hard to foresee.

15
Vision
  • Is an attractive, ideal future that is credible
    yet not readily attainable, the dream of what it
    wants to become, where the organization needs to
    be headed.
  • It represent a dream that can come true
  • - Is easily understood by all stakeholders
  • - Is briefly stated, yet clear and comprehensive
  • - Is challenging, yet attainable
  • - Is lofty, yet tangible
  • - Stir excitement, create unity of purpose
  • - Is not concerned with numbers

16
Sample of visions
  • Heinz vision, is to be "THE WORLD'S PREMIER
    (best) FOOD COMPANY, OFFERING NUTRITIOUS,
    SUPERIOR TASTING FOODS TO PEOPLE EVERYWHERE.
  • Nike, 1960s Crush Adidas
  • Current To be the number one
    athletic company in the world
  • HONDA vision is to Be a Company that Our
    Shareholders, Customers and Society Want.
  • Kraft Foods, Our Vision is Helping People Around
    the World Eat and Live Better.
  • Mazda established a new corporate vision in
    December 1999, comprised of
  • - Vision To create new value, excite and
    delight our customers through the best
  • automotive products and services.
  • - Mission With passion, pride and speed,
    we actively communicate with our
  • customers to deliver insightful
    automotive products and services that exceed
    their
  • expectations.
  • - Value We value integrity, customer
    focus, creativity, and efficient and nimble
  • actions and respect highly motivated
    people and team spirit. We positively support
  • environmental matters, safety and
    society.

17
Mission
  • A broadly stated definition of the organizations
    basic business scope and operations that
    distinguishes it from similar types of
    organizations.
  • The mission takes the next step (after vision)
    and describes WHO the organization is, WHAT it
    does, and WHERE it is going.
  • Is a brief description of a company's fundamental
    purpose. It answers the question, "Why do we
    exist?
  • When writing mission, be brief, but
    comprehensive, choose wording that is simple,
    easy to understand, and descriptive
  • Avoid HOW statements, how the mission will be
    accomplished is described in the strategies
    section in the plan
  • Microsoft mission To enable people and business
    throughout the world to realize their full
    potential

18
Management is needed in ALL
  • Sizes of organization
  • Types of organizations
  • Organization levels
  • Organization areas
  • An organization is a deliberate arrangement of
    people to accomplish some specific purpose.

19
Things (sayings) to think about..Golden Rules
  • If you can not measure it, you can not manage
    it
  • Do unto others as you would have them do unto
    you
  • Dont ever take a fence down until you know the
    reason why it was put up
  • Similar problems have similar (not same)
    solutions.

20
Management approaches
  • Traditional culture, managers think and employee
    do what they are
  • told, the role of the manager in a
    traditional management model is to
  • solve problems at the top level
  • Quality culture, managers are coaches of the team
    they do
  • - communicate the vision, mission, and
    goals
  • - Provide resources
  • - Remove barriers
  • - Seek employee input and feedback
  • - Build trust
  • - Provide training
  • - Reward and recognize performance

21
Denver International Airport(example of project
failure)
  • Designed as largest US airport
  • Denver International Airport Baggage System. It
    ran over budget by almost 30, with an actual
    cost of 250M vs. 195M planned, and completion
    was delayed 18 months.

  • Cost
  • Estimate 1.7 billion (to be done Oct 1993)
  • Pre-construction budget 2.08 billion
  • Aug 1994 spent 3.2 billion
  • Final 16 months late, 2 billion over budget

22
What is a project?
  • It is a group of individuals who are assembled to
    perform different tasks on a common set of
    objectives for a defined period of time
  • How is it different from work?
  • A project is a temporary endeavor (attempt)
    undertaken to accomplish a unique product,
    service, or result
  • (PMBOK Guide 2009, p. 4
  • A project is a temporary effort to create a
    unique product or service. Projects usually
    include constraints and risks regarding cost,
    schedule or performance outcome.
  • Attributes of projects
  • Unique, despite the presence of repetitive
    elements within it.
  • Temporary, definite beginning and end, does not
    apply to the product or service of the project.
  • require resources, often from various areas
  • should have a primary sponsor and/or customer
  • involve uncertainty

23
Software project versus others
  • Invisibility, progress in software project is not
    immediately visible.
  • Complexity.
  • Conformity, software system has to conform to the
    requirement of human (inconsistent) clients.
  • Flexibility, one strength of software is its
    flexible and easy to change.

24
Categories of Software projects
  • Information system project, system interface with
    organization, registration system.
  • Embedded system (process control), system
    interface with a machine, control the air
    conditioning equipment in a building.

25
Project management and operation management
  • Similarities are, consume resources, constrained,
    planned , executed, uncertainty, Consist of
    activities, Predecessor relationships and
    controlled.
  • Differences, projects are temporary and unique,
    operations are repetitive and ongoing.

26
Project and operation
  • Opening new branch in city center is a project
  • Daily weather forecast is an operation.
  • Soccer team daily training sessions is an
    operation.
  • Installing a pool in your backyard is a project
  • Room service at a hotel is an operation
  • Soccer team qualifying for world champion ship
    cup is a project.
  • Cutting your grass is considered operation 

27
Group Size
  • individual term paper
  • group wedding
  • system implementation
  • organization auditing
  • plant construction
  • multi-organization space shuttle
  • wars

28
What is Project Management?
  • Project management is the application of
    knowledge, skills, tools, and techniques to
    project activities in order to meet project
    requirements
  • (PMI, Project Management Body of Knowledge ,
    2009, p. 6)
  • Project Management is the discipline of planning,
    organizing, motivating, and controlling resources
    to achieve specific goals
  • Project management is a methodical approach to
    planning and guiding project processes from start
    to finish.

29
PM at its Most Basic
  • Key project management responsibilities include
  • - creating clear and attainable project
    objectives,
  • - building project requirements
  • - managing the triple constraint for
    projects, which is cost, time, and scope
  • The Triple Constraint
  • The scope constraint refers to what must be done
    to produce the project's end result
  • The time constraint refers to the amount of time
    available to complete a project?
  • The cost constraint refers to the budgeted amount
    available for the project
  • It is the project managers duty to balance these
    three often competing goals

30
What to do if we have lot ofprojects?
  • Are they independent?
  • If they have common goal gtgt Program
  • If not?
  • What causes their mutual dependence?
  • How to manage this situation?
  • Portfolio a means for management of a
  • collection of Projects and/or Programs.

31
Program and Portfolio
  • A program is a group of related projects managed
    together to obtain specific  benefits and
    controls that would likely not occur if these
    projects were managed individually. The Program
    Manager will be responsible for the rolling up of
    information from each of the projects and
    ensuring the overall program is driving towards
    achieving the business objectives.
  • A portfolio is a collection of projects
    or programs grouped together to facilitate
    effective management of efforts to meet
    strategic business objectives. The Portfolio
    Manager  will become very  involved in the
    frontend activities of identifying, prioritizing
    and initiating projects and programs.

32
Portfolio, program, project, and sub project
  • All project done by a company is a portfolio
  • Construction projects done by same company is a
    program.
  • Development of a subdivision contains 500 houses
    is a project.
  • Construction of a house in the subdivision is a
    sub project.

33
Quotes
  • The sooner you begin coding the later you
    finish.
  • What is not on paper has not been said.
  • If you dont know where youre going, any road
    will take you there.
  • If you fail to plan you are planning to fail.
  • If you don't attack the risks, the risks will
    attack you.

34
PM Tools and Techniques
  • Assist project managers and their teams in
    various aspects of project management
  • Some specific ones include
  • Project Charter, scope statement, and WBS (scope)
  • Gantt charts, network diagrams, critical path
    analysis, critical chain scheduling (time)
  • Cost estimates and earned value management (cost)

35
Project Charter
  • It is similar to the goal, but more official,
    more detailed, and in line with vision and goals
    of the company. In most companies a project
    charter is the foundation for success, it
    accomplishes the following
  • -The Project Charter describes the project
    vision, objectives, scope, organization and
    implementation plan
  • Authorizes the project
  • Define the business need
  • Identify the sponsor of the project
  • Identify the project manager, makes him
    accountable for the project.
  • Assigns authority to the project manager on
    behalf of the project sponsor

36
How to create a Project Charter
  • Step 1 Identify the Project Vision
  • Vision The first step taken when defining a
    Project Charter is to identify the project
    vision. The vision encapsulates the purpose of
    the project and is the defined end goal for the
    project team.
  • Objectives Then based on the vision, list three
    to five objectives to be achieved by the project.
    Each objective should be Specific, Measurable,
    Achievable, Realistic and Time-bound (SMART).
  • Scope With a clear view of the Vision and
    Objectives of the project, its time to define
    the project scope. The scope defines the formal
    boundaries of the project by describing how the
    business will be changed or altered by the
    project delivery.
  • Deliverables Then  you need to describe each of
    the deliverables that the project will produce.

37
How to create a Project Charter
  • Step 2 Describe the Project Organization
  • The next step is to identify how the project will
    be structured by listing the customers,
    stakeholders, roles, responsibilities and
    reporting lines.
  • Customers First, identify the project customers.
    A customer is a person or entity that is
    responsible for accepting the deliverables when
    the project is complete.
  • Stakeholders Then identify the project
    stakeholders. A stakeholder is a person or entity
    within or outside of the project with a specific
    key interest or stake in the project. For
    example, a Financial Controller will be
    interested in the cost of the project, and a CEO
    will be interested in whether the project helps
    to achieve the company vision.
  • Roles Now list the key roles involved in
    delivering the project. Examples of roles include
    the Project Sponsor, Project Board and Project
    Manager. Then summarize each of the primary
    responsibilities of each role identified.
  • Structure Once you have a clear view of the
    roles needed to undertake the project, you can
    depict the reporting lines between those roles
    within a Project Organization Chart.

38
How to create a Project Charter
  • Step 3 Plan the Approach to Implementation, You
    now have a solid definition of what the project
    needs to achieve and how it will be organized to
    achieve it. The next step is to describe the
    implementation approach as follows
  • Implementation Plan To provide the Customer and
    Stakeholders with confidence that the project
    implementation has been well thought through,
    create an Implementation Plan listing the phases,
    activities and timeframes involved in undertaking
    the project.
  • Milestones In addition, list any important
    milestones and describe why they are critical to
    the project. A milestone is typically an
    important project event, such as the achievement
    of a key deliverable.
  • Dependencies List any key dependencies and their
    criticality to the project. A dependency is
    defined as an activity that is likely to impact
    on the project during its life cycle.
  • Resource Plan Create plan which summarizes the
    resources involved in undertaking the project by
    listing the labor, equipment and materials
    needed. Then budget the financial resources
    needed.

39
How to create a Project Charter
  • Step 4 List the Risks and Issues
  • The final step taken to complete your Project
    Charter is to identify any project risks, issues,
    assumptions and constraints related to the
    project.
  • And thats it. If you complete each of the steps
    above, then you will create a solid Project
    Charter for your project, helping you to manage
    scope and deliver consistently on time and within
    budget.

40
Project charter elements
  • Project name
  • Project sponsor name
  • Project manager name
  • Project team
  • Project purpose
  • Business case
  • Project result
  • Project resources
  • Project objectives (measurable with success
    criteria)
  • Requirement and description at high level
  • Risks at high level
  • Basic time line and Milestone schedule at a
    summary level
  • Budget at a summary level
  • Approval requirements

41
Management Styles
  • Situational management, is a method whereby the
    current state of the organization determines what
    operational procedures will be implemented to
    achieve desired outcomes. Situational management
    emphasizes a very adaptive management style.
  • Change management, is a systematic approach to
    dealing with change, both from the perspective of
    an organization and on the individual level.
  • To define Change Management, you could say
    that it is about managing this transition from
    the old position to the new one.
  • Change management has at least three
    different aspects, including adapting to change,
    controlling change, and implementing change

42
So youre gonnabe a Project Manager
  • Requisite Skills
  • Comfortable with change
  • Understand the organizations they work in
  • Able to lead teams to accomplish project goals
  • Need both hard and soft skills
  • Hard skills - product knowledge, knowing the
    various PM tools and techniques
  • Soft skills - being able to work with people

43
So youre gonnabe a Project Manager
  • Suggested Skills
  • Soft skills (expanded)
  • Communication listening, persuading
  • Organizational planning, goal-setting,
    analyzing
  • Team Building empathy (understanding),
    motivation.
  • Leadership set examples, be energetic, have
    vision (big picture), delegate, be positive
  • Coping flexibility, creativity, patience,
    persistence
  • Technological experience, project knowledge

44
Effective Project Manager requires
  • For a project manager to be effective he/she
    needs to be able to both manage and Lead .
  • Manage Knowledge in PM good practice. Tools, and
    techniques Plans project, risk, contingency,
    assumptions, scope, change, communication,
    Resource Allocation, Time/schedule,
    Costs/budgets, Monitoring and Controlling,
    Coordinating, Directing, Conflict, Decision
    Making and Problem Solving
  • Lead, Vision/goals, Team Building, Persuasion,
    Inspiration Motivation, Communications,
    Counseling Coaching, Instructing Teaching,
    Mentoring Guiding

45
Project manger power
  • Expert, authority comes from experience.
  • Reward, authority to reward the team.
  • Formal (legitimate), assigned by senior
    management.
  • Coercive, (intimidation) has the authority to
    discipline members of the project team.
  • Referent, referred by CEO and has some of the
    power of the person who assigned him.

46
Effective decision making
  • Ability to negotiate and influence the
    organization and the project management team
  • Guidelines
  • - focus on goals to be served
  • - follow a decision making process
  • - study the environment factors
  • - develop personal qualities
  • - simulate team creativity
  • - manage opportunity

47
Decision making process
  • Define Problem The problem here is which TV to
    buy
  • Fact Collection Collect all data related to the
    different TVs from different showrooms
  • Solution Finding narrow down the TV options.
    Consider your budget and your needs
  • Select Solution narrow down your choice to
    select any one.
  • Implement Solution Once you have decided on the
    TV, go ahead and buy it
  • Monitor Solution See if the TV that you
    purchased is working for you. Check if all the
    features that you selected work for you or no

48
Effective Project manger
  • Follow management, do the same they have done
    before you.
  • Delegation is necessary.
  • You are in charge, establish the flow of
    communication from your team to you, not around
    you.
  • Remember the user.
  • Keep the big picture in mind.
  • Learn how to speak different languages, business
    speak, techno-speak, speak appropriately to the
    audience you address.
  • Delegate, delegate, delegate

49
Delegation
  • You can delegate authority, but you can never
    delegate responsibility for delegating a task to
    someone else.
  • Empowering other to act on your behalf.
  • Accountability remains with the manager as he
    still responsible for success
  • Team member is accountable towards the manager.
  • Management function should not be delegated such
    as appraisal, motivation, and reprimands.
  • Benefits of delegation are free your self for
    important work, team building, and skill
    development.

50
Presenting the project to Management
  • Start at the end, tell them first what the
    proposed project will deliver, forgot the
    techno-language that only impresses geeks.
  • Follow WIIFM Principle, Whats In It For Me.
  • Tailor the presentation, get to the point.

51
PM phases.
52
Relationships Among PGs and Knowledge Areas
53
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54
The Process groups interactions (Topics of
Project Management)
  • 1- Project integration management, includes the
    process and activities needed to identify,
    define, combine, unify, and coordinate the
    various processes and PM activities.
  • 2- project scope management, includes processes
    required to ensure that the project includes the
    work required, and only the work required to,
    complete the project successfully.
  • 3- Project time management, includes the
    processes required to manage the timely
    completion of a project.
  • 4- Project cost management, includes the
    processes involved in estimating, budgeting, and
    controlling cost so that the project can be
    completed within the approved budget.
  • 5- Project quality management, includes the
    processes and activities of the performing
    organization that determine quality policies,
    objective and responsibilities so that that
    project will satisfy the needs for which it was
    undertaken

55
The Process groups interactions (Topics of
Project Management)
  • 6- Project human resources, includes the
    processes that organize and mange project team.
  • 7- Project communications management, includes
    the processes required to ensure timely
    appropriate generation, collection, distribution,
    storage, retrieval, and ultimate disposition of
    project information.
  • 8- Project risk management, includes the
    processes concerned with conducting risk
    management planning, identification, analysis,
    responses, and monitoring and control on a
    project.
  • 9- Project procurement management, includes the
    processes to purchase or acquire the product,
    services, or results needed from outside the
    project team to perform the work.

56
Quotes
  • The most important thing in communication is
    hearing what isn't said. Peter F. Drucker
  • The role of a writer is not to say what we all
    can say, but what we are unable to say.
  • What is important is seldom urgent and what is
    urgent is seldom important. Dwight D. Eisenhower
  • A work well begun is half ended

57
FoxMeyer Drug
  • Large drug distributor, wanted to implement ERP

58
ERP Market Share(SAP)
  • Systems, Applications Products in Data
    Processing
  • founded 1972, Walldorf, Germany
  • 1 vendor of standard business-application
    software in the world - 32 market share
  • PRODUCTS R/2 (mainframe 11 modules)
  • R/3 (client/server - 1992 now gt 1 million users
  • over 9000 customers in 90 countries

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FoxMeyer Corp
  • Statistics Public Company Incorporated 1977 E
    mployees 4,097 Sales 5.17 billion
    (1995) Stock Exchanges New York 
  • Holding company in health care services
  • wholesale distribution of drugs beauty aids
  • served drug stores, chains, hospitals, care
    facilities
  • US 23 distribution centers

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FoxMeyer
  • Due to aging population growth in health care,
    expected high growth
  • Market had extreme price competition, threatening
    margins
  • Long-term strategies
  • efficiently manage inventory
  • lower operating expenses
  • strengthen sales marketing
  • expand services
  • 3 data processing centers, linked
  • included electronic order entry, invoice
    preparation, inventory tracking
  • 1992 began migration of core systems
  • Benefits not realized until system fully
    integrated

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New System
  • Needed new distribution processes IS to
    capitalize on growth
  • Wanted to be able to undercut competitors
  • Replacing aging IS key
  • PROJECT 1994 - hoped to save 40 million
    annually (estimated cost 65 million)
  • complete ERP installation warehouse automation
    system (another 18 million)
  • Select ERP
  • hundreds of thousands of transactions
  • meet DEA FDA regulations
  • benchmarked tested for months
  • picked SAP R/3
  • hired Andersen Consulting to integrate
  • hired Pinnacle Automation for warehouse
    automation system

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Operations
  • FoxMeyer expected the new systems to improve
    operational efficiency
  • Signed several giant contracts
  • counted on savings, underbid competitors
  • Counted on being up and running in 18 months

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Project risks
  • The FoxMeyer Corporation Delta III project had
    the following project risks
  • - Environmental- the management had little or
    no control.
  • - Execution- the project lacked skilled
    and knowledgeable personnel. 
  • - Scope- FoxMeyer was an early adopter of
    SAP R/3. After the project
  • began, FoxMeyer signed a large
    contract.
  • - customer mandate the commitment from
    the top management and
  • users. This was not the case for some of
    the senior management.
  • - SAP warehouse automation system
    integration, two sources, two
  • installers - coordination problems
  • - New contracts forced change in system
    requirements after testing
  • development underway
  • Late, Over budget
  • SAP successfully implemented

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Outcomes
  • Lost key customer - 15 of sales
  • To recoup, signed new customer, expected 40
    million benefit from ERP immediately - pushed ERP
    project deadline ahead 90 days, no time to
    reengineer
  • Warehouse system consistently failed
  • late orders, incorrect shipment, lost shipments
  • losses of over 15 million
  • August 1996 filed for Chapter 11
  • McKesson Bought FoxMeyer operation
  • Made ERP work
  • On time
  • Within budget
  • Full functionality

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Project Critical Success FactorsBelassi Tukel
1996
  • Goal Definition
  • Define goals, scope, requirements
  • Top Management Support
  • Continued involvement
  • User Involvement
  • Project Manager
  • Competent on-site
  • Others
  • Project team, manpower, accurate estimates, test
    train
  • see table 1-2 on page 11 for more.

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Executive Summary Knowledge AND skills (and
attitude(
67
Thanks!
68
(No Transcript)
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Summary
  • All projects are complex
  • IS projects even more so
  • Get diverse people to work together
  • Time
  • Cost
  • Functionality
  • Systems view helps understand projects
  • Critical Success Factors
  • Top management support
  • Clearly stated objectives
  • End user involvement
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