The Strategic Project Planner: A Profit-Driven Project Management Process for Planning Projects to Meet Business Goals

218 Pages·2000·1.646 MB·English

by  Richard E. Westney

titlepage.qxd 8/30/2004 6:02 PM Page 1
THE
STRATEGIC
PROJECT
PLANNER
A Profit-Driven Project
Managementsm Process for
Planning Projects to Meet
Business Goals
Richard E. Westney
Westney Project Services, Inc.
Houston, Texas
Marcel Dekker, Inc. New York Basel
•
TM
fm.qxd 8/30/2004 6:06 PM Page ii
ISBN: 0-8247-0392-8
This book is printed on acid-free paper.
Headquarters
Marcel Dekker, Inc.
270 Madison Avenue, New York, NY10016
tel: [phone]; fax: [phone]
Eastern Hemisphere Distribution
Marcel Dekker AG
Hutgasse 4, Postfach 812, CH-4001 Basel, Switzerland
tel: [phone]; fax: [phone]
World Wide Web
http://www.dekker.com
The publisher offers discounts on this book when ordered in bulk quantities. For more information, write to
Special Sales/Professional Marketing at the headquarters address above.
Copyright © 2000 by Marcel Dekker, Inc. All Rights Reserved.
Neither this book nor any part may be reproduced or transmitted in any form or by any means, electronic or
mechanical, including photocopying, microfilming, and recording, or by any information storage and retrieval
system, without permission in writing from the publisher.
Current printing (last digit):
10 9 8 7 6 5 4 3 2 1
PRINTED IN THE UNITED STATES OFAMERICA
fm.qxd 8/30/2004 6:06 PM Page iii
The Strategic Project Planner
This book is dedicated to each of the fine people of the
Westney Project Services team.No project manager
could ask for more.
fm.qxd 8/30/2004 6:06 PM Page iv
The Strategic Project Planner
About the Author
Richard E. Westney is known worldwide as an authority on project man-
agement. Author of four books on the subject, he has taught project man-
agement at major universities such as Texas A&M, Stanford, and the
Norwegian Institute of Technology. Over 12,000 people from 65 countries
have completed his courses on applied project management.
Mr. Westney is founder and CEO of Westney Project Services, Inc., in
Houston, Texas, a company he formed in 1978 after participating in world-
wide energy projects for Exxon. He holds a BS in mechanical engineering
from the City University of New York, and an MS in management science
from Rensselaer Polytechnic Institute. He is Past President and Fellow of the
Association for the Advancement of Cost Engineering (AACE International),
and an active member of the Project Management Institute (PMI).
Mr. Westney is a licensed professional engineer in Texas and New Jersey,
and a certified Project Management Professional.
fm.qxd 8/30/2004 6:06 PM Page v
The Strategic Project Planner
Preface
The idea of Strategic Project Planning is really nothing new. What isnew is
the recognition of the immense value that the time and effort spent in
Strategic Project Planning have for the project team and the people who
must live with the result.
For the past 10 years or so, project teams have been gathering to spend
from one to several days going through the Strategic Project Planning
Process to develop a Project Execution Plan. As facilitators for this process,
the people of Westney Project Services have developed and continuously
improved methods to make this process both effective and efficient.
Strategic Project Planning is certainly not easy. Many project team mem-
bers are uncomfortable with the ambiguity associated with thinking about
strategies early in a project’s development. We wish we could just get down
to business—and jump to the “execution” phase of the project as soon as
possible. But today’s fast-paced, business-focused projects demand that
we get the planning done right. The best project managers know that the
shorter the schedule,the more important it is to take the time to plan.
But exactly how should this be done? The Strategic Project Planner uses a
proven question-and-answer method to focus the team’s thinking on the
most important elements and issues. This Q&A method was developed
over a period of 10 years, based on our experience in facilitating planning
workshops with hundreds of projects of all types. Over and over, we have
seen these workshops help project teams to:
(cid:127) Make decisions that saved millions of dollars
(cid:127) Resolve major conflicts and find a way for team members to work
together
(cid:127) Change the strategic direction of major projects
(cid:127) Identify and find a way to manage risks
We started using the first version of the Strategic Project Planner in 1994,
and it has become a standard planning tool for many projects and organ-
izations. This new edition incorporates everything we have learned from
the many project teams with whom we have been privileged to work. They
have seen that this method works, and we know it will become one of your
favorite project management tools too.
Richard E. Westney, P.E.
fm.qxd 8/30/2004 6:06 PM Page vi
The Strategic Project Planner
Contents
I. How Strategic Project Planning Ensures Success
II. The Strategic Project Planning Process
III. How The Strategic Project PlannerEnables the
Implementation of the Project Management Institute’s Guide
to the Project Management Body of Knowledge
IV. How to Use The Strategic Project Planner
V. Planning and Conducting the Strategic Project Planning
Workshop
VI. The Strategic Project Planner
Part A: Defining the Vision of Success
A1. Business Goals
A2. Project Objectives & Drivers
A3. Scope of Work
Part B: Defining the Strategy for Success
B1. Management-Level Plan
B2. Risk Management Plan
B3. Organization Plan
B4. Contract Plan
B5. Best Practices Implementation Plan
B6. Team Performance Management Plan
Part C: Defining the Tools for Success
C1. Time Management Plan
C2. Cost Management Plan
C3. Quality Management Plan
C4. Safety & Environmental Management Plan
C5. Materials Management Plan
C6. Communication Management Plan
VII. Issues List and Path Forward Plan
VIII. Using the Project Execution Plan as a Tool for
Communication and Control
ch01.qxd 8/30/2004 6:08 PM Page 1
The Strategic Project Planner Introduction
I. How Strategic Project Planning Ensures Success
A. Benefits of Strategic Project Planning
Leading organizations have repeatedly proven the bottom-line benefits
of the effective application of modern project management methods.
Projects are the means by which an organization stays competitive: by
introducing new products, increasing productivity, and gaining knowledge.
An organization’s capability and effectiveness at planning and executing
projects have a direct impact on profitability. A recent study by the Business
Roundtable showed that organizations that played a strong leadership role
in managing their projects, and that applied Strategic Project Planning and
related Best Practices, enjoyed significantly lower project costs, shorter
schedules, higher quality, and increased profitability (see Figure 1).
It is interesting to note that the conventional wisdom—that no project can
be achieved with low cost, a fast schedule, and high quality all at the same
Benefits of Strategic Project Planning and
Project Management Best Practices
+50%
+6%
LOWER SHORTER
COST SCHEDULE
INCREASED HIGHER
PRODUCTION PROFIT
-28%
-30%
Figure 1: Benefits of Strategic Project Planning
ch01.qxd 8/30/2004 6:08 PM Page 2
Introduction The Strategic Project Planner
time—has been overturned. Through the use of Strategic Project Planning,
and the effective implementation of Project Management Best Practices,
today’s project managers carry out projects that excel in all three categories.
B. What Is Strategic Project Planning?
We all perform projects, and we all want our projects to succeed. What is
Strategic Project Planning, and how will it help us accomplish this goal?
1. What is a project?
A good way to explain Strategic Project Planning is to start by defining what
we mean by a project:
A project is the work that transforms an opportunityinto an asset.
For example:
Opportunity Project Asset
Sell a new product Design and build a Manufacturing facility
manufacturing facility producing the required
product
Improve office Design and implement Hardware and software
productivity a Management working effectively in
Information System an operational infor-
mation system
Acquire new Design and execute a New knowledge that
knowledge research & develop- provides competitive
ment program advantage in product
development
Increase employee job Design and implement An effective benefit
satisfaction a new benefits package plan
2. What is “project success”?
Traditional project managers might consider a successful project to be one
that is completed on time and on (or below) budget. Although these may
be characteristics of a successful project, a project that meets these objec-
tives is not necessarily a success.
ch01.qxd 8/30/2004 6:08 PM Page 3
P
The Strategic Project Planner Introduction I
l.
a
nH
no
iw
n
Today’s project managers know that the only way to define project success
g
S
is as follows:
Et
nr
a
s
A successful project is one that meets its business goals. ute
rg
e
i
A project may finish on time and on budget, but it will not be successful sc

unless the business goals are met. Project managers must therefore focus SP
ur
at all times on the business goals that gave rise to the project in the first co
place. cje
e
c
s
t
s
3. What is Strategic Project Planning?
Strategic Project Planning is the first step toward attaining the benefits
shown in Figure 1. We can define it as follows:
Strategic Project Planning is the process of defining how
a project will be executed in order to achieve its business goals.
The objective of Strategic Project Planning is to produce a Project Execution
Plan, which is used to guide plans, decisions and actions throughout the
project’s life cycle.
Strategic Project Planning allows us to take advantage of the critical early
stages of the “Influence Curve.” The Influence Curve, shown in Figure 2,
demonstrates that the most important time for ensuring a project’s success
is in its early phases. Yet this is the part of a project that is most often
neglected.
What should we be doing in the early phases of a project in order to exert
the maximum influence on project success? The answer is defined through
Strategic Project Planning. The resulting Project Execution Plan will show
how the project will be organized and led in order to implement Best
Practices, and meet its business goals.
4. What is a Project Execution Plan?
A Project Execution Plan (PEP) is a document that describes the project
team’s strategy for planning and executing the project in order to meet its
business goals. It ensures alignment at all times and at all levels, between
project plans, decisions and actions, and the business goals that led to the
project in the first place.
ch01.qxd 8/30/2004 6:08 PM Page 4
Introduction The Strategic Project Planner
Planning for Project Success — The “Influence Curve”
Project
Initiation
e
c
ns
Ability to InflueProject Succes Strategic AFpPpurrnoodjevinacglt & Project Startup &
Project Execution Turnover
Planning
Time in the Project Life-Cycle
Figure 2: The Influence Curve showing the importance of
early Strategic Project Planning in ensuring project success
The PEP is a living document, periodically updated to reflect changes in
business conditions, priorities, or strategies. It is a guide for everyone in the
project, be they members of the project team, investors or partners, or
contractors serving the project. It defines roles and responsibilities, iden-
tifies issues, and serves as a tool for communication.
The PEP is best presented as a summary document, incorporating detailed
information, such as relevant procedures, by reference. It gives a “big pic-
ture” view of what the project is, why it is important, and the strategy for
executing it.