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What is Project in Project Management? Types, Importance and Examples

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19th Feb, 2024
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    What is Project in Project Management? Types, Importance and Examples

    In the dynamic business environment of current times, existing business organizations aggressively seek to upgrade or change their practices, and startups begin with the best practices of the processes. Both need the route of the Project to accomplish their objective.

    So, what is a project in this dynamic business environment? Projects are, in short, vehicles of change. They are the instruments that deconstruct the need of a business and set goals to fill the gaps within its organization. Going for Project Management trainings will help you learn further how project management works.

    What is Project? 

    The basic definition of a project is: “an organizational initiative to achieve certain outcomes within a timeframe and a budget.” Moreover, a project is conceived when business needs are recognized in the processes being used within an organization. These needs are the “gaps” that require to be filled in an effort to set the organization on a growth path. These gaps are of strategic importance and could range from customer complaints, declining revenues, or new, upcoming business opportunities. They are treated as goals and targets to be achieved within a fixed period of time. It is expected that the defined goals would work as a catalyst to bring about changes to fine-tune and sharpen the working of a business set-up. 

    Things that Define a Project 

    Here are the most important points that define a project:  

    1. Goal

    It is the ultimate deliverable or the destination to be reached. It is done when a need for change is recognized. This is the first step towards setting a goal; recognizing the true shape of things. It could be obsolete machinery (manufacturing), a system problem (admin or software issues), paucity of resources ( financial or human), reduced standing in the market, faulty products, and any number of other issues that require immediate attention for rectification and revival measures.

    Once the problems are given cognizance, then what ought to become clearer. It is the ought-to-be status that forms the goals. It helps in deciding priorities as various future accomplishments are weighed in terms of importance. The order of importance is decided upon according to the value system that an organization subscribes to. This helps in focusing dedicated efforts toward achieving goals.

    2. Objectives

    After an organizational introspection leads to setting goals, it is the next step of defining objectives. Often objectives are confused with goals because of their close proximity in meaning. But it is objectives that help in giving clarity to goals. Objectives within a project are to comprehend activities and their direction, resolve conflicting activities and ensure that personnel is accountable for their work.

    In the end, to understand the objective, we have to understand that it might be a company’s goal to be one of the Fortune 500 companies. To achieve this, it has to have objectives that would gradually guide it toward fulfilling its goal. Thus objectives are the yardstick that helps assess and measure progress toward a goal. As successes accumulate, the sense of achievement thrusts the organizational members towards the set goal.

    3. Scope

    This is a very critical component of a Project. The scope is drawn once the expectations of the client and stakeholders are on the table. The continual reference to the scope of work ensures that there is no going off course. It keeps a firm control over what is to be done and what cannot be/should not be executed. Without this outline, a Project can serve in the unwanted direction and end up not delivering the desired outcome. The scope is communicated to all the personnel concerned so that they are on the same page about the goals and objectives of the exercise.

    Having understood what a Project is, it is important that its planning is done by an organizational member who has done formal training for PMP. Without it, he might find himself deficient in handling, executing, or delivering its outlined goals and objectives.

    Nature of Projects

    A project can only be managed well if the nature of the project is clearly understood by the project manager. A project has commonly been defined as a unique, temporary, multidisciplinary effort by an organization toward creating an output within a framework of checks and balances. When talking about the nature of a project, the three qualities that stand out are uniqueness, temporary nature, and its aim to create output/deliverables.

    1. Unique

    Every project is unique. No project can be executed on the lines of previous projects. Even the algorithm in which the project is carried out would be new and exclusive to the demands of the project. It cannot be likened to normal everyday operations either. The latter has to be done on a daily basis to keep the organizational cycle moving. But a project would be goal-specific. Its very nature/ characteristics would set it apart from everyday operations. It is a combination of activities that are formulated with a view to fulfill specific goals and objectives, staying within the scope of things.

    2. Temporary

    The temporary nature of the project is such because it is bound within two boundaries; a beginning and an end. The beginning is all about a project taking off and going through various stages to reach the end. The end spells the required deliverables or outcomes that have been specified by the client or preordained by the responsible organizational members. It is not always necessary that the project has to end the way it has been envisaged. It can also be aborted mid-way due to different reasons. So, the temporary nature of a project is about the engagement period and has nothing to do with the resultant product or service.

    3. Creating Output

    Every time a project comes into being, it is for the specific purpose of achieving or delivering a desired outcome. This outcome could be of a tangible or intangible nature. A product is tangible, and a service is intangible. To deliver outcomes, companies have to create outputs. These are often taken to be activities that are designed with an eye on the ultimate deliverable. But the output is the immediate result that happens as soon as the project is completed.

    It might include training employees on the new ERP system, meaning that the first level of scope has been delivered. Successful delivery of outputs would add up to successful delivery of outcomes. This is uncertain as the planning and execution of projects differ, and the quality of resources and tools assigned also vary.

    4. Big Project

    A Big Project/small project will also contribute to deciding the nature of the project. Under its unique and temporary character, we have to refer to its size. Project sizing is a part of project management that estimates the measure of resources and practices to be applied in executing a project.  The expected time span and the number of multidisciplinary departments working on it are also some of its keys deciding factors.

    This helps in working out the scope of project management activities that would fulfill the expected targets. A Big project will have many deliverables with umpteen activities and tasks working towards the ultimate goal. Project management tools employed would also be different from the ones to be employed in a relatively smaller project.

    5. Small Project

    These are projects that have shorter timelines, are relatively less costly, and have fewer resources deployed for their execution. In short, every determinant of a project size is slightly shrunk. Its impact on a company’s balance sheet can also be slight, but a large project could disbalance its bottom line. Small projects, more often than not, do not have dedicated resources. They would be a part of more than one project and would be shunted from one to the other depending on the urgency or requirement. 

    Other characteristics of a small project would be a single objective and an easy solution that can be achieved without complicated efforts; it has a narrowly defined scope of work; it is to be implemented in only one business unit and is headed by a single person. In contrast, a project with a broad scope of work and multiple objectives involving multiple skill areas would not fall under the head of a small project. It has to be handled with the skillset and intensive efforts required for a big project.

    A small project would be more likely to be dealing with small changes within an organization. It could be about developing a training course, implementing a software system, upgrading the existing system, developing a website, evaluating existing operational practices, or preparing a proposal. Whatever the size of the project, one has to remember that processes have to be managed, and people have to be guided.

    To do this skillfully, it is advisable that an aspiring project manager undertakes the best PRINCE2 course. Going for this course will help a project manager know when and how to apply which knowledge area to a project. A project has to be evaluated by a trained project manager for its fitment needs.

    Types of Projects

    The nature of a project, its features, characteristics, and size decide the course of action for its fulfillment. It is the customer, contractor, and project management team that has to work in tandem with each other to see the project to its desired conclusion. The customer specifications and the consequent management strategy differ for every project and its type. There are four types of projects demanding different approaches. These are:

    1. Traditional Projects

    These are projects that follow a templated lifecycle. The course of the project is predicted, and so is its outcome. It is about creating products/goods, and services. With multiple and dynamic manufacturing practices available, competition is stiff and stringent planning for production is required. Some things have to be taken into account before chalking a production plan.

    These would be material requirements planning, supply chain management, production scheduling, Production lead time, capacity planning, and inventory control. Keeping a finger on all the segments of manufacturing means increased complexity in Operations. So manufacturing projects would have to be more precisely planned to the last detail, ensuring that all the tiniest details have been addressed and accounted for.

    2. Agile Projects

    Knowledge of general management and specialization in domain management is especially needed when we need to plan an iterative project. Here objectives can only be accomplished dependent on a series of operations that are themselves affected by resource constraints. There are glaring conflicts between stated objectives about scope, costs, timelines, and quality and the limitations clamped on human, material, and financial resources. Therefore, dealing with an agile project, certain guidelines have to be strictly followed.

    The first would be absolute clarity in specifications about project objectives and plans that include delineation of scope, budgeting, scheduling, determining budget demands, and forming project teams. Maximum resource utilization has to be ensured by keeping the supply chains working smoothly without delays so that there is strict adherence to prescribed schedules and plans. An operations strategy should be in place to control and coordinate planning, design, estimating, contracting, and completing small iterations. Lastly, a very efficient communication channel is needed to resolve issues among the project participants.

    3. Agency Projects

    Managing a project is all about multitasking. Several elements have to be simultaneously handled, all the while anticipating different outcomes to be achieved within the pre-decided timeframe and budget restrictions. There are some very common issues that a manager is bound to encounter, namely of scope definition, budget, communication, and conflict within the team. A cloudy outline of objectives can give rise to a host of problems, including those related to resource and stakeholder management. Oftentimes, this is the major cause of project failure. Along with the clarity of goals comes the setting of milestones and the calibration of results.

    This can be done by SMART ( specific, measurable, attainable, relevant, timebound) and CLEAR ( collaborative, limited, emotional, appreciable, refinable) means. A project has to be parcelled into small packets and assigned to the members of the project team with their own objectives and goals. Another issue that has to be addressed mid-way is Scope creep. A project begins with a particular vision but can change course and move in a direction not envisaged. This can only be managed by firm navigation, increase of budget, and duration.

    4. Remote Projects

    The management of these projects vastly differs from the other three types of projects in the way they are planned, performed, or managed. The goals and objectives in remote projects are not the same as in the other developmental projects, which have customer requirements as outputs and outcomes. Here, it would be a team or group of professionals located in different places but working on one project. The time zones and cities might differ, and the responsibilities too would be different, but the outcome targeted would be unified. Oftentimes, a remote project might have positive deliverables, or it might not have anything to do with bottom lines, and yet that project would be commissioned. An important example of a project which is in remote mode is a research project.

    The sponsor is not affected by the result. Here the objectives and goals would be about deconstructing or reinforcing a theory/a find. Other developmental projects could be dependent on the research projects. So planning, controlling, or scheduling might be a problem as research is all about milestones that might not be fulfilled as per the expectations. The most appropriate example of this is the pharmaceutical industry, where constant research must be carried on. It requires a very flexible budget and timeframe to reach a medical solution or treatment to the regulatory body.

    For projects to be desirably closed, the personnel handling these should be certified professionals. Intricacies of project management can only be foreseen and addressed if the organizational members/ project manager is well qualified.

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    What are the Characteristics of a Project?

    1. Projects Progress through a Lifecycle to Accomplish Goals

    The project management lifecycle is a step-by-step structure of best practices for shepherding a project from start to finish. It gives a project an organized technique to plan, execute, and complete a project. There are four phases:

    a. Initiation: This is the beginning phase of the project. It helps determine the project's goals, scope, and resources, giving a project and team clear guidance.

    b. Planning: This phase determines how to achieve the goals set in the initiation phase. This step helps create budgets, timeframes, and milestones, as well as gather resources and documentation. This step also entails estimating and forecasting risk, implementing change management methods, and developing communication protocols.

    c. Implementation: This generally entails monitoring and evaluating progress, maintaining quality, reducing risk, managing the budget, and using data to guide your decisions.

    d. Closure: At the last stage of the project management lifecycle, you'll wrap up project activities, hand over the finished product or service to its new owners and analyze what went well and what didn't. It will also be an opportunity to recognize your efforts.

    2. Projects are Unique

    Every project is distinct. Every project is a unique, original, and one-of-a-kind, never-before-tried venture. A project is temporary since its scope and resources are predetermined, and its start and conclusion dates are fixed in time. A project is distinctive in that it consists of a particular set of procedures intended to achieve a single goal rather than being a routine series of operations.

    3. Projects Require Cross-departmental Collaboration

    Projects necessitate the collaboration of multiple teams from various departments. This is known as cross-functional collaboration, and it may be very beneficial to your company. Fusing ideas from multiple groups and departments enables you to develop, contribute new viewpoints, and work toward common objectives.

    4. The project is a Single entity

    A single project may involve various people with various roles, tasks, and specialties, yet it remains a single entity. This is because these components work together to achieve the project's objectives.

    What is the 3M’s of Project?

    Certain imperatives need to be observed in executing a project. There are 3M’s - methodology, mindset, and metrics. These determine the direction and the route of the project:

    1. Measure

    It is how the project needs to be addressed. It needs to be measured for what is required. Here a method has to be crafted so that every phase of the project is measured for its success or progress toward the ultimate goal. The methodology is a set of predetermined principles and processes that would be followed when executing a project. This guide helps in prioritizing the work portioned out within the project.

    The project team has the option to apply Agile, Kanban, Scrum, Waterfall, or even hybrid methodologies. Then there is the critical path method, Lean project management, Six Sigma, Critical Chain Project management, and more. It all depends upon the scope, goals, and objectives of a project. It is the character of a particular project that will decide which approach is best suited.

    2. Manage to Measure

    Here, it is the attitudes and influences of the project management team that guides it toward the best approach. The tactics and the control that is required to be practiced for managing the resources marked out for a project. It involves several elements that constitute a mindset prepared to measure performance objectively, namely:

    • Critical Thinking: It is the ability of the project personnel to be able to view a project multidimensionally and find solutions for its completion. This will reveal the hidden risks and issues that might assume unmanageable proportions during the project.
    • Initiative: when the project personnel is self-motivated and does not to be told what to do; that denotes his ability to take the initiative without being commanded. Success is more likely.
    • Collaboration: Having a team spirit while working on a project is hugely important for its success. There should be no personal or professional conflicts within the team, for that would mean sure failure. So success has to be obvious to be measured.

    3. Make it Easy

    There are metrics to determine the success or failure of any project. Comprehending the project in its entirety is what leads to its positive completion. The pre-set milestones lead to well-informed decisions about the next steps. Then there are metrics related to costs to evaluate performance, productivity, Return on investment, customer satisfaction, employee satisfaction, and schedule variance. Keeping a set of metrics alongside the project would make execution and assessment much easier and less time-consuming.

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    Project Life Cycle

    The sequence of steps and phases used to complete a project is known as its life cycle. It outlines the high-level project delivery process and the actions you must take to bring about change. It's the way projects go; it's how a team is led through each stage of a project, from the initial brief to the final delivery.  There are five phases:

    1. Project Initiation Phase

    The first stage of a project's life cycle involves starting the project with your team and the client and obtaining their commitment. You systematically compile all relevant information to determine the project's scope, cost, and resources. The purpose of the beginning phase is to take a project's (sometimes vague) brief and determine what the project must do and accomplish to succeed.

    Steps during the initiation stage: 

    • Make a project chart with vision, objectives, and goals. 
    • Identify the service that needs to be provided. 
    • Identify the primary problem and its solution.
    • Identify the cost and benefits of the solution.
    • Identify the stakeholders.
    • Tools used in this phase:
    • Project Proposal: It defines the project and outlines the goal and requirements.
    • RACI Chart: It plots the roles and responsibilities of the team.

    2. Project Planning stage

    In planning, you outline every task that must be completed and develop the project's overall road map. It would be best if you decided how, you and your team will accomplish the project's objectives at this stage of the project's life cycle. It's worthwhile to assess those objectives using 3P's: Possible, Passionate, and Pervasive.

    Steps during the Planning stage:

    Make a project plan by identifying the constraints and creating a timeline.

    Create a financial plan.

    Create a resource plan and make your team. 

    Identify the risks and dependencies and make a mitigation plan. 

    Tools used in this phase: 

    • Gantt Chart: A horizontal bar chart that shows members which tasks must be accomplished in what sequence and how long each job is expected to take. 
    • Risk Register: A diagram that shows project-related risks, their likelihood, their possible impact, their level of risk, and any mitigation strategies. 

    3. Project Execution stage

    This is the stage of the project life cycle in which you finally get to put your fantastic project plan into action. Upon bringing your resources on board, you brief them, establish the ground rules, and make introductions. Following that, everyone pitches in to complete the tasks outlined in the plan. 

    Steps during the Execution stage: 

    • Team leadership 
    • Task creation 
    • Task briefing 
    • Client management 
    • Communication 

    Tools used in this phase: 

    Change Requests: These are the documents used to suggest alterations to a project's objectives or scope. 

    4. Project Monitoring and Controlling Phase

    This is one of the most challenging phases of the project management process. It entails performance reporting as well as project monitoring and control. This entails monitoring the project's progress and, if necessary, taking action to correct any deviations from the original plan. 

    Steps during the project monitoring and controlling phase: 

    • Cost and time management 
    • Quality management 
    • Manages the changes. 

    Tools used in this phase: 

    • Burndown Chart: This graph shows the time left and divides the chores into smaller, more manageable chunks. 

    5. Project Closure Phase

    It's helpful to arrange a post-project review meeting to review the project's strengths and shortcomings, the team's performance, what went wrong or didn't go so well, and how to improve moving forward. This can be one of the most enjoyable project stages since it allows you to recognize and honor valuable team members while celebrating triumphs. 

    Steps during the project closure phase: 

    • Performance analysis 
    • Team analysis 
    • Post-implementation review 

    Tools used in this phase: 

    • Impact Report: This report, provided to your stakeholders, compiles a series of metrics demonstrating how your initiative made an impact. 
    • Project Closeout Report: A project closeout report summarizes the results of your project. 

    The project life cycle gives project managers a roadmap for navigating their work. At each project stage, it specifies where to begin and where to move next. Whatever happens, the project life cycle gives a dependable structure to return to and refocus on.

    How Do You Plan a Project?

    A project will be a non-starter if it is not planned well. There are parameters and guidelines that should be followed when planning a project. These would be: 

    1. Create and analyze a business case thoroughly.
    2. Meet stakeholders for approval of the created business case.
    3. Define the scope of the project.
    4. Set up project goals and objectives. 
    5. Determine project deliverables. 
    6. Project schedules and milestones should be created.
    7. Tasks should be assigned, or resources planned according to members’ strengths.
    8. Risk assessment.

    How to Implement a Project?

    Putting a project into action involves several steps, including some planning that must be done beforehand. The following list of activities will help you carry out a project successfully:

    • Assess the project plan: It is advantageous to construct a strategy that satisfies the requirements of management, clients, and important stakeholders within the first stage of the project cycle. Before beginning a project, evaluate the plan and ensure everyone on the team knows the project deliverables. 
    • Planning: Project managers should regularly discuss the team's development during this phase with them. To ensure the team has all they need to finish the project effectively, compare the project's timeframe to the anticipated schedule and monitor the available resources. Communication is essential at this phase of the process to keep the team informed about the project's priorities.
    • Execution of Plan: Many projects face change, and how well a project manager executes such changes can influence the project's conclusion. Ask the team questions and keep in touch to find out where they need extra assistance. If a project deviates from the plan, be prepared to devote more personnel or resources.
    • Analyze Project Data: It's crucial to consistently examine and analyze data during a project's implementation phase to gauge progress against original estimates. You can gather information on staffing, resources, and budget using specialized project management software to monitor and control the changes.
    • Final Reports and Closing: Provide reports to the project team, clients, and stakeholders detailing how the project fared concerning the anticipated budget and timeframe during the final implementation phase. Companies can use this stage to evaluate the project's accomplishments and pinpoint any areas that require improvement going forward, which can help the project management cycle in the long run.

    When is a Project Considered Successful?

    After completing the project, it's important to deliver the project successfully. Six factors indicate that the project was successful.

    1. Delivery on time: A project will be successful if it is finished on schedule or earlier than anticipated. This indicates that the team members did an excellent job and dedicated all their time and effort to the project. 

    2. Delivery on Budget: Frequent unforeseen difficulties could necessitate more project funding. To handle these difficulties, the manager must seek additional resources. Yet, when a project stays within the budget established at the start of the project, it signifies that the project did not encounter many obstacles that would cause it to exceed the scope of the budget. The initiative will be considered a success. 

    3. All objectives achieved: When a project is completed, it usually has a goal and objectives. These objectives were supposed to be accomplished by the project's conclusion. A project is successful when its goals are fully met, and its purpose is realized since it has solved the problems it was intended to solve. 

    4. Customer Satisfaction: In any business, the consumer is always king. Thus, if clients are pleased with the work the employees have completed, the project is successful. Because of the trust and happiness gained from the project, they established good relationships and reliable contracts. 

    5. Good Feedback: Clients' positive feedback to the project manager and team suggests the project succeeds. 

    6. Good Profit: The project can make money and pay back its invested money. If both of these goals are met, and there are indications that the initiative has raised company profitability, the endeavor is unquestionably deemed a success. The project will also be regarded as successful if it gives the stakeholders clear advantages.

    Examples of Successful Projects

    Some of the successful samples of the project are described as follows:  

    1. Amazon: It has been most successful in increasing its visibility to its customers, tracking tasks, and enabling different groups of resources to handle projects independently 
    2. Siemens Healthineers: It had to manage 100+ projects of varying dimensions and targets. They wanted to have a platform that could create a system for managing each project independently. 
    3. Triumph Group: The company began an overhauling of processes within the company. The aim was to centralize processes and systems. This led to better governance, improved reporting, and increased visibility.  
    4. American Airlines: Merged with U.S. Airways, creating overlapped systems and processes, particularly technological. Introducing resource management helped them streamline their operations.

    Conclusion

    A project with its characteristics, features, and nature is an opportunity to take a business to the next level of achievement. The changes which are brought about or a product that has been introduced are expected to improve the balance sheet. So, that is the ultimate goal of a project - to improve the entire scenario. KnowledgeHut’s online trainings for Project Management ensures a project management trainee gets comprehensive information about the project and its various components.

    Frequently Asked Questions (FAQs)

    1How Project management helps you manage projects?

    Project management is a business strategy that curates processes and brings them together to deliver advantages to organizations. It streamlines and formulates guidelines and techniques to enhance the success rate of a product in the market. A major plus of project management is that it increases the chances of getting desired outcomes. So, a project management exercise would help plan a project in a way that all its goals, objectives, budget, and timelines are achieved.

    2How is a project different from day-to-day operations?

    While operations are continual and permanent, projects are distinct and temporary. Additionally, whereas projects typically have a set budget, operations must turn a profit in order to remain functional. 

    3What is the purpose of a project?

    The cause behind a project's existence, the significance of the work completed, the aspiration or ideal it pursues, or the course it adopts and upholds are all explained by the project's purpose.

    4What is the project process?

    A project process is a set of interrelated activities that are performed to achieve a specific business goal. The different project phases in the process include planning, execution, monitoring, and controlling the project to ensure that it meets the desired outcome.  

    5What are the features of the project?

    The features of a project typically include: 

    • Unique goal. 
    • A predefine start and end date. 
    • Proper resources. 
    • Involves and plans risk and uncertainty. 
    • Collaboration and coordination. 
    • Involves stakeholder expectations and requirements. 
    • May have interdependent tasks and activities. 
    Profile

    Kevin D.Davis

    Blog Author

    Kevin D. Davis is a seasoned and results-driven Program/Project Management Professional with a Master's Certificate in Advanced Project Management. With expertise in leading multi-million dollar projects, strategic planning, and sales operations, Kevin excels in maximizing solutions and building business cases. He possesses a deep understanding of methodologies such as PMBOK, Lean Six Sigma, and TQM to achieve business/technology alignment. With over 100 instructional training sessions and extensive experience as a PMP Exam Prep Instructor at KnowledgeHut, Kevin has a proven track record in project management training and consulting. His expertise has helped in driving successful project outcomes and fostering organizational growth.

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