1.4 Stages in the Project Management Life Cycle

Projects typically move through predictable stages of development. Figure 1.4 shows the traditional stages of a project as representative of the type of work found in each stage of development: Initiation, Planning, Implementation, and Close Out.

The Initiation Stage

The first stage is the Initiation stage. Ideas for projects have to surface and be recognized within an organization. In general, all projects arise in response to a need. For example, customer demand may have increased so that your current factory doesn’t produce enough. Your need for more product drives a project to build a second factory.

Given that you have had other classes that have discussed needs, or possibly have heard about needs elsewhere, we will not discuss the psychological theory of needs, but suffice it to say that stakeholder needs are the basis from which organizations create and deliver projects.

In meeting these needs, organizations use projects to deliver value to both organizations and stakeholders, thereby sustaining the competitive position of an organization and also improving a stakeholder’s situation.

Suffice it to say that customer needs, whether internal or external, drive many projects. If a car or truck, for instance, has a poorly designed set of dashboard controls, then the next version of the car or truck, if it survives management scrutiny, will probably be revised to have closer knobs, bigger buttons, brighter signals, etc. that meet the customers’ need for better quality.

The Initiation stage wrestles with needs that are always around us. Some are recognized and some are not. When needs are recognized by individuals and organizations, sometimes this leads to new project ideas. Consequently, most organizations have to sift through project proposals or ideas and decide which projects to start, which projects to terminate, and which projects to table until further consideration.

We will discuss in Chapter 3 how an organization analyzes needs and selects projects to meet its unique strategy. The recognition of needs is a fairly complex process because while it is done by most organizations, it is not fully predictable.

The Initiation stage ends when projects or groups of projects are selected for the next stage of the project management life cycle, the Planning stage. Obviously, organizations select projects by how well they meet or satisfy stakeholder or customer and their resources.

The Planning Stage

Planning the selected project is the second stage in the project management life cycle. After top management has agreed on the project that will provide the most value to the organization, then it is up to the project team to flesh out all the details of the project under consideration. Once all the details of each project are analyzed, agreed upon, and documented, these are all captured in a final document called the Project Plan.

The Project Plan includes all details regarding cost, schedule, scope, human resource requirements, communication, risk, change management, quality, and procurement of the project. The Project Plan can serve as an excellent tool for unifying project team members in their focus of what must be done on a project. Development of the plan can take time since projects are by nature unique and not very well understood.

Organizations can facilitate the development of a Project Plan by providing templates that help fill in the gaps of missing information. Templates are copies of previous project plans that teams can use to facilitate their own project planning process.

Of course, it helps to read project templates or previous project documents rather than to just copy an entire project plan completely without consideration of what made that particular project unique and quite possibly not applicable to your project.

In chapters 4–11, we spend quite a bit of time discussing and providing you with necessary tools to cover scope, cost, and schedule issues found in the Project Plan.

The Implementation Stage

When the Project Plan is finished, the project team gets to actually put into action what they decided needs to be done in the plan. This stage is typically called Implementation or Execution.

The Implementation stage is where the rubber meets the road, so to speak. Hopefully, the Project Plan is done well enough to guide the project team as to what needs to be done on the project. Implementation is the step of the project management life cycle in which team members do the majority of the actual work and spend the most money.

Monitoring and controlling activities (Chapter 12) are at their peak in the Implementation stage, as project managers spend a lot of time following up to ensure work was done sufficiently. Cost, schedule, and scope changes tend to arise as work does not always match what was planned for in the Project Plan. Usually changes drive increases in project costs. Thus, project managers try to control excess spending by keeping work consistent with what was outlined in the Project Plan.

A key aspect of the Implementation stage is managing customer and stakeholder expectations of what needs are going to be met in fulfilling the Project Plan. Whether they are internal or external stakeholders, people expect a new product or service as soon as possible. Project managers have to manage stakeholder expectations so that customers are not disappointed when the new product or service is provided.

The management of customer and stakeholder expectations is definitely an art form; however, it is not one most project managers relish. This is because stakeholders can be difficult to satisfy and projects hardly ever go exactly the way the Project Plan outlined.

The Close Out Stage

After the Project Plan is implemented, the project eventually needs to be terminated; thus, the final stage of project management is called Close Out.

This step is important because there are many loose ends that need to be tied up to finish the project. Lessons learned have to be finalized, documented, and shared within the organization and possibly with corporate sponsors and partners. Project team members have to be rewarded and assigned to future work if that is consistent with the organization’s policy and culture. Facilities have to be vacated and prepped for future project teams. Contracts have to be closed and finalized with regard to payment, terms and conditions, and future contract liabilities (if applicable).

The goal of the Close Out stage is to ensure that all resources are managed in an orderly fashion so that work can be completed and new project assignments can be made. Remember, projects go away, but customer needs do not. Thus, there will always be a continuing selection and termination of projects within an organization.

Project rewards and a celebration party are viable project team expectations once the project is successfully planned and implemented. We will discuss this stage in more detail in Chapter 13 as all expectations need to be meticulously managed in this final stage.

As each project life cycle stage is unique, so are the costs of each stage. We will next discuss the unique resource and cost profiles of each project life cycle stage.