The Project Manager’s MBA

Why did I choose this resource?

In order to grow Anant into a successful company, we must understand how all projects – both internal and external – impact the financial health of the company. The executive team has set targets for this year that include improving financially, as well as in terms of project operations. In order to meet those objectives, we must run our projects smartly and with an eye on their strategic and financial impacts on the company.

What did you learn from it?

I learned that we should be running our projects like independent businesses. We must focus on budget, projects, cash flow, etc., exactly like we do at the corporate level. Success at the project level will help to ensure that we achieve success at the company level.

Key Knowledge

• Project managers must understand their company’s strategy and how their projects fit into it.
• Project managers need to align their projects with the strategic choices made by the company
• Project cycle time
  • Reduced cycle time adds to cash flow, reduces project’s capital requirements and increases economic value
  • instead of increasing manpower and working people overtime, better approach is to increase the budget for good management practices
    • Have one well-trained project manager
    • Develop rapid prototyping process
    • Establish core team for duration of the project
    • Ensure hat the team members work full time on one project
    • Co-locate core team and other team members, especially on new product development projects.
    • Develop upper management support
• Understand customer to ensure we develop products they will buy – leading to revenue generation
  • must understand the competitive forces at work in the market

1. Design products, services and processes that help customers solve problems and meet or exceed customer expectations
2. PMs must look at market for their end product or service based on size, segmentation and competition
3. Best way to solve customer problems is to create a prototype and put it into customer and end-user hands (do not rely on market data alone)
4. When customers don’t know what they want, gives examples of practical ways to get customer / end-user involvement:
   1. put customers and end-users on the core team
   2. directly observe end users’ problems
   3. develop focus groups to explain problems
   4. develop prototypes to give end-users experience

• Calculate project costs
  • PMs must know cash flow, break-even analysis, and return to shareholders for every project
  • Four types of costs:
    
  • Also, Cost of Goods Sold (COGs) – add the cost of materials needed to make the product, direct manufactureing labor costs, and the manufacturing overhead costs

How are you using what you learned?

• Currently in the process of developing tools for closely monitoring key financial KPIs for projects
• More closely tracking individual project profitability on client projects
• Taking advantage of coworking between team members in the office

Key Changes / Key Actions

• Continue to improve how we track individual project KPIs
• Take advantage of physical coworking
• Improve our scheduling and budgeting for projects
• Incorporate clients into our project execution processes (e.g., having AHRI team on the weekly SCRUM)

Source

• Name : The Project Manager’s MBA
• Author : Dennis J. Cohen and Robert J. Graham
• Summary.com: The Project Manager’s MBA