Project Life Cycle

Phases of Project Life Cycle

Phase 1: Need/Problem/Opportunity identification Phase 2: Development of Proposed solution Phase 3: Implementation of Proposed solution Phase 4: Terminating the project

Phase I - Needs Identification

Project Life Cycle (Phase I)

Identify Develop a Effort a Need Proposed Solution Perform the Project Terminate the Project

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Time

Project Life Cycle - Phase I

Involves Need Identification. Results in Request for Proposal. Will detail on
1. Process of Identifying needs and Selecting projects. 2. Developing a request for proposal

3. Process of proposal solicitation.

Identifying Needs, Problems, or Opportunities

Recognize a need, problem, or opportunity & clearly define the same Quantify the problem Determine the budget Prepare a Request For Proposal Select the project(s) with the greatest benefit for the cost expended

Project Selection
Develop a set of criteria against which each opportunity will be evaluated List the assumptions Gather data and information for each opportunity Evaluate each opportunity against the criteria

Preparing a Request for Proposal

Why RFP? State, comprehensively and in detail, what is required, from the customers point of view Enable contractors or a project team to understand what the customer expects so that they can prepare a thorough proposal The need may be communicated informally and sometimes only orally

Preparing a Request for Proposal (Cont.)

Guidelines for drafting a formal RFP to external contractors: statement of work (SOW) customer requirements deliverables customer-supplied items approvals required by the customer type of contract

Preparing a Request for Proposal (Cont.)

the payment terms the required schedule for completion instructions for the format and content of the contractor proposals due date for proposals evaluation criteria occasionally will indicate the funds the customer has available

Soliciting Proposals
Methods: Identify a selected group of contractors in advance and sending each an RFP Advertise in certain business newspapers Process considered a competitive situation

Soliciting Proposals (Cont.)

Dont provide information that is not provided to all contractors May hold a bidders meeting to explain the RFP and answer questions Not all use RFP

Phase II Developing a Proposed Solution

Project Life Cycle (Phase II)

Effort
Identify Develop a a Need Proposed Solution Perform the Project Terminate the Project

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Time

Phases II of Project Life Cycle

Phase 2: Involves development of Proposed

solution and results in submission of Proposal

Proposed Solutions - Exceptions

In many situations an RFP does not involve soliciting competitive proposals from external contractors, and the second phase of the

project life cycle may be completely bypassed.

Pre-RFP/Proposal Marketing
Should not wait until formal RFP solicitations are announced before starting to develop proposals Develop relationships with potential customers Maintain frequent contacts with past and current customers

Pre-RFP/Proposal Marketing (Cont.)

Be familiar with a customers needs and requirements Consider this marketing or business development; no cost to the customer May prepare an unsolicited proposal Efforts are crucial to the foundation for winning a contract

Bid/No-Bid Decision
Factors to consider: competition risk mission extension of capabilities Reputation with the customer customer funds proposal resources project resources

Bid/No-Bid Decision (Cont.)

Be realistic about probability of winning the contract A lot of non-winning proposals can hurt a contractors reputation Exercise to be submitted on 4th Jan: A company that is providing training in HR, on page 52 of the book, there is Bid/No Bid check-list which lists down the deliberations over whether to bid or no bid. Individually submit your assessment

How do you prepare a a Winning Proposal?

A selling document not a technical report Convince the customer that you are the best one to solve the problem Highlight the unique factors that differentiate you from competing contractors Emphasize the benefits to the customer Write in a simple, concise manner Address requirements as laid out in the RFP Be realistic in scope, cost, and schedule

Proposal Preparation
Can be a straightforward task performed by one person or it could be a resource-intensive effort requiring a team May designate a proposal manager Schedule must allow time for review and approval by management Can be a few pages or hundreds of pages Customers do not pay contractors to prepare proposals

Proposal Contents
Proposals are organized into three sections: Technical Section

understanding of the problem

proposed approach or solution benefits to the customer

Proposal Contents (Cont.)

Management Section description of work tasks deliverables

project schedule
project organization related experience equipment and facilities

Proposal Contents (Cont.)

Cost Section labor materials subcontractors and consultants equipment and facilities rental travel documentation overhead escalation contingency or management reserve fee or profit

Pricing Considerations
Be careful not to overprice or underprice the proposed project Consider: reliability of the cost estimates risk value of the project to the contractor customers budget competition

Proposal Submission and Follow-Up

Submit proposals on time Hand deliver expensive proposals or send 2 sets by different express mail services, if necessary Continue to be proactive even after submission

Customer Evaluation of Proposals

Some look at the prices and select only from the three lowest-priced proposals Some screen out prices above budget or whose technical section doesnt meet all the requirements Some create a proposal review team that uses a scorecard May submit a best and final offer (BAFO)

Customer Evaluation of Proposals (Cont.)

Criteria that might be used in evaluating: compliance with SOW understanding of the problem or need soundness of the proposed approach contractors experience and past success experience of key individuals management capability realism of the schedule price reasonableness, realism, and completeness

Types of Contracts
A contract is: A vehicle for establishing customer-contractor communications and arriving at a mutual understanding and clear expectations An agreement between the contractor, who agrees to provide a product or service, and the customer, who agrees to pay Must clearly spell out the deliverables Two types of contracts: fixed price and cost reimbursement

Types of Contracts (Cont.)

Fixed-price contract

Price remains fixed unless the customer and contractor agree

Provides low risk for the customer

Provides high risk for the contractor

Is most appropriate for projects that are well defined and entail little risk

Types of Contracts (Cont.)

Cost-reimbursement contract

Provides high risk for the customer

Provides low risk for the contractor Is most appropriate for projects that involve risk Customer usually requires that the contractor regularly compare actual expenditures with the proposed budget and reforecast cost-atcompletion

Contract Provisions
Miscellaneous provisions that may be included in project contracts: Misrepresentation of costs Notice of cost overruns or schedule delays Approval of subcontractor Customer-furnished equipment or information Patents

Contract Provisions (Cont.)

Disclosure of proprietary information Termination Bonus/penalty payments Changes

Phase III & IV (Performing the Project)

Phases of Project Life Cycle

Phase 3: Performing the Project Involves implementation of Proposed solution. Results in accomplishing Project Objective. Phase 4: Terminating the Project Involves certain closure activities. Results in feedback from all concerned

Project Life Cycle (Phase III & IV)

Effort
Identify Develop a a Need Proposed Solution Perform the Project Terminate the Project

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Time

Performing the Project

Performing the Project (Phase III)

Effort
Identify Develop a a Need Proposed Solution Perform the Project Terminate the Project

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Time

Performing the Project

1. Planning the Project 2. Implementing the project 3. Controlling the Project

Planning the Project

Clearly define the project objective Divide and subdivide the project Define the specific activities to be performed Graphically portray the activities in a network diagram Determine which resources and how many are needed Make a time estimate Make a cost estimate for each activity Calculate a project schedule and budget Develop a baseline plan

Planning the Project (Cont.)

Keep in mind: Projects overrun their budgets, miss completion dates, or only partially satisfy their technical specifications because there is no viable baseline plan The people involved in performing the project should participate in planning the work; they are most knowledgeable. Participating in the planning helps individuals become committed to accomplishing it

Implementing the Project

Once the baseline plan has been developed, project work can proceed. The project team, led by the project manager, will implement the plan and perform the activities or work elements. The pace of project activity will increase as more and various resources become involved.

Controlling the Project

Monitor progress Measure actual progress and compare it to planned progress

Track which activities have been started and/or completed, when, and how much money has been spent Take corrective action to get back on track
Compare on a timely and regular basis and take corrective action

Controlling the Project (Cont.)

A regular reporting period should collect: Data on actual performance Information on any changes in scope, schedule, and budget Keep in mind: Data should be collected in a timely manner and used to update the schedule and budget Compare updated schedule and budget to the baseline and analyze

Controlling the Project (Cont.)

Project management is proactive Phase III ends when the requirements have been met, project objective has been accomplished, and the customer is satisfied

Terminating the Project

Project Life Cycle (Phase IV)

Effort
Identify Develop a a Need Proposed Solution Perform the Project Terminate the Project

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Time

Terminating the Project

Purpose: To learn from the experience in order to improve performance on future projects.

Termination activities should be identified in the baseline plan

Verify that all agreed-on deliverables were provided Organize and file project-related documentation

Terminating the Project (Cont.)

Assure that all payments have been collected from the customer Assure that all payments for materials and subcontractors have been paid Prepare a written performance evaluation of each member of the project team Hold post-project evaluation meetings Celebrate

Internal Post-Project Evaluation

Have individual meetings with team members and a group meeting with the project team Hold soon after the completion Announce meeting in advance so people can be prepared Individual meetings allow team members to give their personal impressions

Internal Post-Project Evaluation (Cont.)

Develop an agenda for a group meeting Group meeting should discuss performance and recommendations for improvement Issue a brief written report to management with a summary and recommendations

Internal Post-Project Evaluation (Cont.)

Some topics that might be discussed: technical performance cost performance schedule performance project planning and control customer relationships team relationships communications problem identification and resolution recommendations

Customer Feedback
Meet to discuss whether the project provided the customer with the anticipated benefits, assess the level of customer satisfaction, and obtain any feedback Participants include the project manager, key project team members, and key representatives of the customer Ask open-ended questions Customers can express their level of satisfaction and provide detailed comments

Customer Feedback (Cont.)

If the customer is satisfied with the project: Ask about other projects you could do perhaps without going through a competitive RFP process Ask permission to use the customer as a reference Get feedback regarding satisfaction through a post-project customer evaluation survey

Early Project Termination

If research shows costs will be much more than originally anticipated If there is a change in a companys financial situation Because of dissatisfaction of the customer Avoid early termination due to customer dissatisfaction by monitoring customer satisfaction continually and taking corrective action