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PERFORMING INTEGRATED CHANGE CONTROL Integrated change control involves identifying, evaluating, and managing changes through out the project life cycle. The three main objectives of integrated change control are: • Influencing the factors that create changes to ensure that changes are beneficial: To ensure that changes are beneficial and that a project is successful, project managers and their teams must make trade-offs among key project dimensions, such as scope, time, cost, and quality. • Determining that a change has occurred: To determine that a change has occurred, the project manager must know the status of key project areas at all times. In addition, the project manager must communicate significant changes to top management and key stakeholders. Top management and other key stakeholders do not like surprises, especially ones that mean the project might produce less, take longer to complete, cost more than planned, or create products of lower quality. • Managing actual changes as they occur: Managing change is a key role of project managers and their teams. It is important that project managers exercise discipline in managing the project to help minimize the number of changes that occur. Important inputs to the integrated change control process include the project management plan, work performance information, change requests, enterprise environmental factors, and organizational process assets. Important outputs include approved change requests, a change log, and updates to the project management plan and project documents. Change requests are common on projects and occur in many different forms. They can be oral or written, formal or informal. For example, a project team member responsible for installing a server might ask the project manager if it is acceptable to order a server with a faster processor than planned. The server is from the same manufacturer and has the same approximate cost. Because this change is positive and should have no negative effects on the project, the project manager might give a verbal approval at the progress review meeting. Nevertheless, it is still important that the project manager document this change to avoid any potential problems. The appropriate team member should update the scope statement to include the new server specifications. Still, keep in mind that many change requests can have a major impact on a project. For example, customers who change their minds about the number of hardware components they want as part of a project will have a definite impact on its scope and cost. Such a change might also affect the project's schedule. The project team must present such significant changes in written form to the project sponsor, and there should be a formal review process for analyzing and deciding whether to approve these changes. Change is unavoidable and often expected on most IT projects. Technologies change, personnel change, organizational priorities change, and so on. A good change control sys tem is also important for project success. Change Control on IT Projects From the 1950s to the 1980s, IT was often referred to as data automation or data processing. At that time, a widely held view of project management was that the project team should strive to do exactly what it planned, on time and within budget. The problem with this view was that project teams could rarely meet original project goals, especially for projects that used new technologies. Stakeholders rarely agreed up front on the scope of the project or what the finished product should look like. Time and cost estimates created early in a project were rarely accurate. Beginning in the 1990s, most project managers and top management realized that project management is a process of constant communication and negotiation about project objectives and stakeholder expectations. This view assumes that changes happen through out the project life cycle and recognizes that changes are often beneficial to some projects. For example, if a project team member discovers a new hardware or software technology that could satisfy customers' needs for less time and money, the project team and key stakeholders should be open to making major changes in the project. All projects will have some changes, and managing them is a key issue in project management, especially for IT projects. Many IT projects involve the use of hardware and software that is updated frequently. To continue the example from earlier in this section, the initial plan for ordering the server might have identified a model that used cutting-edge technology at the time. If the actual server order occurred six months later, it is quite possible that a more powerful server could be available at the same cost. This example illustrates a positive change. On the other hand, the server manufacturer specified in the project plan could go out of business, which would result in a negative change. IT project managers should be accustomed to such changes and build some flexibility into their project plans and execution. Customers for IT projects should also be open to meeting project objectives in different ways. Some changes might make sense but be too large to fit into a current project. Remember that projects have scope, time, cost, and other goals, and changes often affect those goals. If the organization wants to meet time and cost goals, for example, it must control changes to the project's scope. Organizations often decide to document some change requests and include them in an upgrade to the current project. Even if project managers, project teams, and customers are flexible, it is important that projects have a formal change control system. This formal system is necessary to plan for managing change. Change Control System A change control system is a formal, documented process that describes when and how official project documents may be changed. It also describes the people authorized to make changes, the paperwork required for these changes, and any automated or manual tracking systems the project will use. A change control system often includes a change control board, configuration management, and a process for communicating changes. A change control board (CCB) is a formal group of people responsible for approving or rejecting changes to a project. The primary functions of a CCB are to provide guidelines for preparing change requests, evaluating change requests, and managing the implementation of approved changes. An organization could have key stakeholders for the entire organization on this board, and a few members could rotate based on the unique needs of each project. By creating a formal board and a process for managing changes, overall change control should improve. However, CCBs can have some drawbacks, such as the time it takes to make decisions on proposed changes. CCBs often meet only once a week or once a month, and may not make decisions in one meeting. Some organizations have streamlined processes for making quick decisions on smaller project changes. One company created a "48-hour policy," in which task leaders on a large IT project would reach agreements on key decisions or changes within their expertise and authority. The person in the area most affected by this decision or change then had 48 hours to go to top management and seek approval. If the project team's decision could not be implemented for some reason, the top manager consulted would have 48 hours to reverse the decision; otherwise, the project team's decision was approved. This type of process is an effective way to deal with the many time-sensitive decisions or changes that project teams must make on IT projects. ============= GLOBAL ISSUES Rapid changes in technology, such as the increased use of mobile roaming for communications, often cause governments around the world to take action. Incompatible hard ware, software, and networks can make communications difficult in some regions, and a lack of competition can cause prices to soar. Fortunately, a group called the Organization for Economic Co-operation and Development (OECD) promotes policies that will improve the economic and social well-being of people around the world. In February 2012, the OECD called upon its members' governments to boost competition in international mobile roaming markets. "The OECD has detailed a series of measures that, if implemented would, it says: 'encourage effective competition, raise consumer awareness and protection and ensure fairer prices.' If these fail to produce results it says: 'Governments should consider price regulation for roaming services,' and that 'Wholesale roaming ser vices could be regulated by means of bilateral or multilateral wholesale agreements with mutually established price caps.' ============= Configuration management is another important part of integrated change control. Configuration management ensures that the descriptions of the project's products are correct and complete. It involves identifying and controlling the functional and physical design characteristics of products and their support documentation. Members of the project team, frequently called configuration management specialists, are often assigned to perform configuration management for large projects. Their job is to identify and document the functional and physical characteristics of the project's products, control any changes to such characteristics, record and report the changes, and audit the products to verify conformance to requirements. Visit the Institute of Configuration Management's Web site (www.icmhq.com) for more information on this topic. Another critical factor in change control is communication. Project managers should use written and oral performance reports to help identify and manage project changes. For example, on software development projects, most programmers must make their edits to a copy of the master file in a database; to ensure version control, programmers must "check out" the file to edit it. If two programmers are allowed to check out the same file, they must coordinate to merge their changes. In addition to written or formal communication methods, oral and informal communications are also important. Some project managers have stand-up meetings once a week or even every morning, depending on the nature of the project. The goal of a stand-up meeting is to quickly communicate what is most important for the project. For example, the project manager might have a stand-up meeting every morning with all of the team leaders. There might be a stand-up meeting every Monday morning with all interested stakeholders. Requiring participants to stand keeps meetings short and forces everyone to focus on the most important project events. Why is good communication so critical to success? One of the most frustrating aspects of project change is not having everyone coordinated and informed about the latest project information. Again, it is the project manager's responsibility to integrate all project changes so that the project stays on track. The project manager and staff members must develop a system for notifying everyone affected by a change in a timely manner. E-mail, real-time databases, cell phones, and the Web make it easy to disseminate the most cur rent project information. You will learn more about good communication in Section 10. ============ Table 3 Suggestions for performing integrated change control View project management as a process of constant communication and negotiation Plan for change Establish a formal change control system, including a change control board (CCB) Use effective configuration management Define procedures for making timely decisions about smaller changes Use written and oral performance reports to help identify and manage change Use project management software and other software to help manage and communicate changes Focus on leading the project team and meeting overall project goals and expectations ============= Project Communications Management. Table 3 lists suggestions for performing integrated change control. As described earlier, project management is a process of constant communication and negotiation. Project managers should plan for changes and use appropriate tools and techniques, such as a change control board, configuration management, and good communication. It is helpful to define procedures for making timely decisions about small changes, use written and oral performance reports to help identify and manage changes, and use software to assist in planning, updating, and controlling projects. Project managers must also provide strong leadership to steer the project to successful completion. They must not get too involved in managing project changes. Project man agers should delegate much of the detailed work to project team members and focus on providing overall leadership for the project in general. Remember, project managers must focus on the big picture and perform project integration management well to lead their team and organization to success. CLOSING PROJECTS OR PHASES The last process in project integration management is closing the project or phase, which requires that you finalize all activities and transfer the completed or cancelled work to the appropriate people. The main inputs to this process are the project management plan, accepted deliverables, and organizational process assets. The main tool and technique is again expert judgment. The outputs of closing projects are: • Final product, service, or result transition: Project sponsors are usually most interested in making sure they receive delivery of the final products, services, or results they expected when they authorized the project. For items produced under contract, formal acceptance or handover includes a written statement that the terms of the contract were met. Internal projects can also include some type of project completion form. • Organizational process asset updates: The project team should provide a list of project documentation, project closure documents, and historical information produced by the project in a useful format. This information is considered a process asset. Project teams normally produce a final project report, which often includes a transition plan describing work to be done as part of operations after the project is completed. Teams also often write a lessons-learned report at the end of a project, and this information can be a tremendous asset for future projects. (See Section 10, Project Communications Management, for more information on creating final project reports, lessons-learned reports, and other project communications.) Several organizations also conduct a post-implementation review to analyze whether the project achieved what it set out to do. Information from this type of review also becomes an organizational process asset for future projects. USING SOFTWARE TO ASSIST IN PROJECT INTEGRATION MANAGEMENT As described throughout this section, project teams can use various types of software to assist in project integration management. Project teams can create documents with word processing software, give presentations with presentation software, track information with spreadsheets, databases, or customized software, and transmit information using various types of communication software.
Project management software is also an important tool for developing and integrating project planning documents, executing the project management plan and related project plans, monitoring and controlling project activities, and performing integrated change control. Small project teams can use low-end or midrange project management software to coordinate their work. For large projects, such as the Olympic Games described in the Media Snapshot earlier in this section, organizations may benefit most from high-end tools that provide enterprise project management capabilities and integrate all aspects of project management. As you learned in Section 1, organizations can also use software to assist in project portfolio management and optimization. Users can evaluate alignment, risk, and net value of a portfolio of projects given a certain budget constraint, as shown here. Portfolio management software often provides many types of charts or dashboards to help man agers see the big picture in managing portfolios of projects. For example, FIG. 9 shows column charts, bar charts, pie charts, and bubble charts from www.projectmanager.com. All projects can benefit from using some type of project management information system to coordinate and communicate project information. Another category of software that can help align projects with business strategy is called business service management (BSM) tools. "BSM tools track the execution of business process flows and expose how the state of supporting IT systems and resources is impacting end-to-end business process performance in real time. Consider, for example, the difference between IT working to increase network capacity and having IT able to demonstrate that because of their efforts, they increased the ability to process new customer orders by 15 percent." BSM tools can help improve alignment between IT projects by upgrading network capacity, for example. BSM tools can also help achieve business goals, such as reducing costs by processing customer orders more quickly. In addition, BSM tools can help validate the projects' contributions to the success of the business. However, recent studies suggest that successfully implementing BSM tools, like many other new tools, is far from easy. "Like those work-from-home, get-rich-quick schemes, you will hear from vendors claiming fast and easy business services management. Smaller upstart vendors will often oversimplify problems and oversell their products' capabilities, while most larger vendors still have work to do integrating disparate product portfolios. Both tend to understate the effort and cost to deploy and configure." As you can see, a lot of work is involved in project integration management. Project managers and their teams must focus on pulling all the elements of a project together to successfully complete it. ========== CASE WRAP-UP Without consulting Nick Carson or his team, Nick's CEO hired a new person, Jim Lansing, to act as a middle manager between himself and the people in Nick's department. The CEO and other top managers really liked Jim; he met with them often, shared ideas, and had a great sense of humor. He started developing standards that the company could use to help manage projects in the future. For example, he developed templates for creating plans and progress reports and put them on the company's intranet. However, Jim and Nick did not get along, especially after Jim accidentally sent an e-mail to Nick that was intended for the CEO. In the e-mail, Jim said that Nick was hard to work with and preoccupied with the birth of his son. Nick was furious when he read the e-mail, and stormed into the CEO's office. The CEO suggested that Nick move to another department, but Nick did not like that option. Without considering the repercussions, the CEO offered Nick a severance package to leave the company. Because of the planned corporate buyout, the CEO knew the company might have to let some people go anyway. Nick talked the CEO into giving him a two-month sabbatical he had earned plus a higher percentage on his stock options. After discussing the situation with his wife and realizing that he would get over $70,000 if he resigned, Nick took the severance package. He had such a bad experience as a project manager that he decided to stick with being a technical expert. Jim, however, thrived in his position and helped the company improve its project management practices and ensure success in a highly competitive market. ============= Summary Project integration management is usually the most important project management knowledge area, because it ties together all the other areas of project management. A project manager's primary focus should be on project integration management. Before selecting projects to pursue, it is important for organizations to follow a strategic planning process. Many organizations perform a SWOT analysis to help identify potential projects based on their strengths, weaknesses, opportunities, and threats. IT projects should support the organization's overall business strategy. Common techniques for selecting projects include focusing on broad organizational needs, categorizing projects, performing financial analyses, developing weighted scoring models, and using balanced scorecards. Project integration management includes the following processes: • Developing the project charter involves working with stakeholders to create the document that formally authorizes a project. Project charters can have different formats, but they should include basic project information and signatures of key stakeholders. • Developing the project management plan involves coordinating all planning efforts to create a consistent, coherent document. The main purpose of project plans is to facilitate action. • Directing and managing project work involves carrying out the project plans by per forming the activities included in it. Project plan execution usually requires the majority of a project's budget. • Monitoring and controlling project work is necessary to meet the performance objectives of the project. The project team should continuously monitor project performance to assess the overall health of the project. • Performing integrated change control involves identifying, evaluating, and managing changes throughout the project life cycle. A change control system often includes a change control board (CCB), configuration management, and a process for communicating changes. • Closing the project or phase involves finalizing all project activities. It is important to follow good procedures to ensure that all project activities are completed and that the project sponsor accepts delivery of the final products, services, or results. Several types of software products are available to assist in project integration management. Other tools can assist in project selection and ensure that projects align with business strategy. Quiz 1. Which of the following processes is not part of project integration management? a. developing the project business case b. developing the project charter c. developing the project management plan d. closing the project or phase 2. What is the last step in the four-stage planning process for selecting IT projects? a. IT strategy planning b. business area analysis c. mind mapping d. resource allocation 3. Which of the following is not a best practice for new product development projects? a. aligning projects and resources with business strategy b. selecting projects that will take less than two years to provide payback c. focusing on customer needs in identifying projects d. assigning project managers to lead projects 4. A new government law requires an organization to report data in a new way. Which of the following categories would include a new information system project to provide this data? a. problem b. opportunity c. directive d. regulation 5. If estimates for total discounted benefits for a project are $120,000 and total discounted costs are $100,000, what is the estimated return on investment (ROI)? a. $20,000 b. $120,000 c. 20 percent d. 120 percent 6. A is a document that formally recognizes the existence of a project and provides direction on the project's objectives and management. a. project charter b. contract c. business case d. project management plan 7. Which of the following items is not normally included in a project charter? a. the name of the project manager b. budget information c. stakeholder signatures d. a Gantt chart 8. ensures that the descriptions of the project's products are correct and complete. a. Configuration management b. Integrated change control c. Integration management d. A change control board 9. Which of the following is not a suggestion for performing integrated change control? a. use good configuration management b. minimize change c. establish a formal change control system d. view project management as a process of constant communication and negotiation 10. What tool and technique is used for all processes of project integration management? a. project management software b. templates c. expert judgment d. all of the above Answers 1. a; 2. d; 3. b; 4. c; 5. c; 6. a; 7. d; 8. a; 9. b; 10. c Discussion: 1. Describe project integration management. How does it relate to the project life cycle, stake holders, and the other project management knowledge areas? 2. Describe options that organizations have for selecting projects that align with their mission or strategy, and describe how each might work differently in the selection of IT projects. 3. Summarize key work involved in each of the six processes of project integration management. 4. Either from your own experience or by searching the Internet, describe a well-planned and executed project. Describe a failed project. What elements of project integration might have contributed to the success or failure of each? 5. Discuss the importance of following a well-integrated change control process on IT projects. What consequences can result from not following these best practices? What types of change control would be appropriate for small IT projects? What types of change control would be appropriate for large ones? Exercises 1. Write a short paper based on the section's opening case. Answer the following questions: a. What do you think the real problem was in this case? b. Does the case present a realistic scenario? Why or why not? c. Was Nick Carson a good project manager? Why or why not? d. What should top management have done to help Nick? e. What could Nick have done to be a better project manager? 2. Download a free trial of MindView mind mapping software from matchware.com/itpm and create a mind map of a SWOT analysis for your organization. Include at least two strengths, weaknesses, opportunities, and threats, and then provide ideas for at least three potential projects. Or, you can use your college or university for the SWOT analysis, focusing on what it can do to improve services for students. 3. Use spreadsheet software to create Figures 4 through FIG. 7 in this text. Make sure your formulas work correctly. 4. Perform a financial analysis for a project using the format provided in FIG. 5. Assume that the projected costs and benefits for this project are spread over four years as follows: Estimated costs are $200,000 in Year 1 and $30,000 each year in Years 2, 3, and 4. Estimated benefits are $0 in Year 1 and $100,000 each year in Years 2, 3, and 4. Use a 9 percent discount rate, and round the discount factors to two decimal places. Create a spreadsheet or use the business case financials template on the companion Web site to calculate and clearly display the NPV, ROI, and year in which payback occurs. In addition, write a paragraph explaining whether you would recommend investing in this project, based on your financial analysis. 5. Create a weighted scoring model to determine grades for a course. Final grades are based on three exams worth 20 percent, 15 percent, and 25 percent, respectively; homework is worth 15 percent; and a group project is worth 25 percent. Enter scores for three students. Assume that Student 1 earns 100 percent (or 100) on every item. Assume that Student 2 earns 70 percent on each of the exams, 80 percent on the homework, and 95 percent on the group project. Assume that Student 3 earns 90 percent on Exam 1, 80 percent on Exam 2, 75 percent on Exam 3, 80 percent on the homework, and 70 percent on the group project. You can use the weighted scoring model template, create your own spreadsheet, or make the matrix by hand. 6. Develop an outline (major headings and subheadings only) for a project management plan to create a Web site for your class, and then fill in the details for the introduction or over view section. Assume that this Web site would include a home page with links to a syllabus for the class, lecture notes or other instructional information, links to the Web site for this textbook, links to other Web sites with project management information, and links to personal pages for each member of your class and future classes. Also, include a bulletin board and chat room feature where students and the instructor can exchange information. Assume that your instructor is the project's sponsor, you are the project manager, your classmates are your project team, and you have three months to complete the project. 7. Research software mentioned in this section, such as software for assisting in project selection, enterprise project management software, or BSM tools. Find at least two references and summarize your findings in a short memo to senior management. 8. Watch videos and read articles to research how two different organizations did a good job in directing and managing project work. For example, you can search "PMI Project of the Year award" to find examples. Find at least four references and summarize your findings in a short paper. 9. Read and critique two of the Suggested Readings provided on the companion Web site for this guide, or find similar articles related to topics discussed in this section. Write a short paper summarizing your ideas. Running Case Note: Additional running cases are provided in section C and on the companion Web site. Template files are also available on the companion Web site. This running case starts here and continues through Section 13. Tasks based on this case are explained in the following Tasks section; throughout the guide, these tasks will build on work done in previous sections and scenarios. Manage Your Health, Inc. (MYH) is a Fortune 500 company that provides a variety of healthcare services across the globe. MYH has more than 20,000 full-time employees and more than 5,000 part-time employees. MYH recently updated its strategic plan; key goals include reducing internal costs, increasing cross-selling of products, and exploiting new Web-based technologies to help employees, customers, and suppliers work together to improve the development and delivery of healthcare products and services. Below are some ideas the IT department has developed for supporting these strategic goals: 1. Recreation and Wellness Intranet Project: Provide an application on the current intranet to help employees improve their health. A recent study found that MYH, Inc. pays 20 percent more than the industry average for employee healthcare premiums, primarily due to the poor health of its employees. You believe that this application will help improve employee health within one year of its rollout so that you can negotiate lower health insurance premiums, providing net savings of at least $30/employee/year for full-time employees over the next four years. This application would include the following capabilities: • Allow employees to register for company-sponsored recreational programs, such as soccer, softball, bowling, jogging, and walking. • Allow employees to register for company-sponsored classes and programs to help them manage their weight, reduce stress, stop smoking, and manage other health related issues. • Track data on employee involvement in these recreational and health-management programs. • Offer incentives for people to join the programs and do well in them (e.g., incentives for achieving weight goals, winning sports team competitions, etc.). 2. Health Coverage Costs Business Model: Develop an application to track employee healthcare expenses and company healthcare costs. Healthcare premiums continue to increase, and the company has changed insurance carriers several times in the past 10 years. This application should allow business modeling of various scenarios as well as tracking and analyzing current and past employee healthcare expenses and company healthcare costs. This application must be secure and run on the current intranet so several managers and analysts can access it and download selected data for further analysis. The new application must also import data from the current systems that track employee expenses submitted to the company and the company's costs to the insurance provider. You believe that having this data will help you revise policies concerning employee contributions to healthcare premiums and help you negotiate for lower premiums with insurance companies. You estimate that this application would save your company about $20/employee/year for full-time employees over the next four years and cost about $100,000 to develop. 3. Cross-Selling System: Develop an application to improve cross-selling to current customers. The current sales management system has separate sections for major product and service categories and different sales reps based on those products and services. You see great opportunities to increase sales to current customers by providing discounts when they purchase multiple products and services. You estimate that this system would increase profits by $1 million each year for the next three years and cost about $800,000 each year for development and maintenance. 4. Web-Enhanced Communications System: Develop a Web-based application to improve development and delivery of products and services. There are currently several incompatible systems related to the development and delivery of products and services to customers. This application would allow customers and suppliers to provide suggestions, enter orders, view the status and history of orders, and use electronic commerce capabilities to purchase and sell their products. You estimate that this system would save your company about $2 million each year for three years after implementation. You estimate that the system will take one year and $3 million to develop and require 20 percent of development costs each year to maintain. Tasks 1. Summarize each of the proposed projects in the Running Case section using a simple table format suitable for presentation to top management. Include the name of each project, identify how each one supports business strategies, assess the potential financial benefits and other benefits of each project, and provide your initial assessment of the value of each project. Write your results in a one- to two-page memo to top management, including appropriate back-up information and calculations. 2. Evaluate the four projects in the Running Case section by preparing a weighted scoring model using the template provided on the companion Web site for this text. Develop at least four criteria, assign weights to each criterion, assign scores, and then calculate the weighted scores. Print the spreadsheet and bar chart with the results. Also write a one page paper that describes this weighted scoring model and the results. 3. Prepare a business case for the recreation and wellness intranet project. Assume that the project will take six months to complete and cost about $200,000. Use the business case template provided on the companion Web site for this text. 4. Prepare a project charter for the recreation and wellness intranet project. Assume that the project will take six months to complete and cost about $200,000. Use the project charter template provided in this text and the sample project charter provided in Table 1 as guides. 5. Prepare a change request for the recreation and wellness intranet project, using the tem plate provided on the companion Web site for this text. Be creative when making up information. Terminology
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