Page 24 - DMGT302_FUNDAMENTALS_OF_PROJECT_MANAGEMENT

Unit 1: Introduction to Projects

1.11 Summary Notes

A project is a group of unique, interrelated activities that are planned and executed in a
certain sequence to create a unique product or service.

The successful project management is all about structure, control, sufficient attention to
detail and continuously driving action.

Plan the project – to understand how long it will take and how much it will cost?
Project management is quite often the province and responsibility of an individual project
manager.

A project manager is often a client representative and has to determine and implement the
exact needs of the client based on knowledge of the firm he/she is representing.
The Project Management Institute (PMI) was founded in 1969.

The payback period for a project is the initial fixed investment in the project divided by
the estimated annual cash inflows from the project.
The initiation phase is the beginning of the project.

The project takes shape during the implementation phase.
1.12 Keywords

Comparative Benefit Model: For this situation, assume that an organization has many projects
to consider, perhaps several dozen. Senior management would like to select a subset of the
projects that would most benefit the firm.
Definition Phase: In this phase, the requirements that are associated with a project result are
specified as clearly as possible.

Implementation Phase: This phase involves the construction of the actual project result.
Initiation Phase: The initiation phase is the beginning of the project. In this phase, the idea for
the project is explored and elaborated.

Payback Period: The payback period for a project is the initial fixed investment in the project
divided by the estimated annual cash inflows from the project.
Social Issues: A project can only be successful when there is no conflict between the management
and the local populace.
The Competitive Necessity: Using this criterion, Republic Steel undertook a major plant rebuilding
project in the late 1960s in its steel bar manufacturing facilities near Chicago.
The Operating Necessity: If a flood is threatening the plant, a project to build a protective dike
does not require much formal evaluation.

The Product Line Extension: In this case, a project to develop and distribute new products would
be judged on the degree to which it fits the firm’s existing product line.

1.13 Review Questions

1. Define the term “Project Management”.

2. Explain the responsibilities of a project manager.
3. Discuss the project management as a profession.

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