Part A: Foundations
Key concepts in project management
Key takeaways
- A project is a temporary endeavour undertaken to create a unique product, service or result; operations are ongoing and repetitive, and the project creates the capability that operations then run.
- Project management asks whether this project is being done right, programme management whether the projects together deliver the benefit, and portfolio management whether these are the right projects to be doing at all.
- Output, outcome, benefit and value are distinct, and a project can deliver its output perfectly and produce no benefit when the output is not used.
- Progressive elaboration adds detail within the agreed scope, and estimate ranges narrow with it: about minus 25 to plus 75 per cent for a rough order of magnitude estimate, minus 5 to plus 10 per cent for a definitive one.
- Enterprise environmental factors are conditions outside the project's control that constrain it; organisational process assets are the organisation's own templates, procedures and lessons, which the project uses and updates.
A project is temporary and produces something unique; operations are ongoing and repetitive. Almost every difficulty in managing a project traces back to applying operational assumptions to temporary work, or the reverse.
Projects, programs and portfolios
Projects, programmes and portfolios compared
| Project | Programme | Portfolio | |
|---|---|---|---|
| Scope | Defined deliverables, progressively elaborated | Wider, encompassing the projects within it | Organisational, changing with strategy |
| Change | Managed against a baseline; change is controlled | Expected, and the programme adapts | Continuously monitored against the strategy |
| Success measured by | Deliverables produced to time, cost and quality | Benefits realised | Aggregate performance and strategic alignment |
| Management focus | Delivering the output | Coordinating and realising benefit | Selecting and prioritising |
| Typical Kenyan example | Constructing one county water treatment works | The county's whole water access programme | The county's entire capital investment portfolio |
The value delivery system
- The seventh edition of the PMBOK Guide reframes projects as components of a value delivery system: the arrangement by which an organisation converts strategy into outcomes that deliver value to stakeholders
- Output, outcome, benefit and value are distinct and are examined: the output is what the project produces (a treatment works), the outcome is the change that results (treated water available), the benefit is the improvement realised (fewer waterborne illnesses, higher billed volume), and value is the worth of that benefit to the organisation and its stakeholders
- A project can deliver its output perfectly and produce no benefit, which happens whenever the output is delivered and not used, and it is the commonest form of project failure that is not recorded as failure
- Benefits are realised after the project closes, frequently long after, which is why benefits realisation is a programme or operational responsibility rather than a project one, and why it is so often nobody's
- Information flows both ways in the system: strategy directs project selection, and project delivery informs what strategy is achievable
- For a Kenyan public entity the equivalent framing is the results chain used in public investment management: inputs, activities, outputs, outcomes and impact, which is the same idea in the vocabulary the Public Finance Management Act, 2012 and the National Treasury's project appraisal guidance use
Delivering the output is not the objective
A project delivering its stated deliverables to time, cost and quality has succeeded as a project and may still have wasted the organisation's money, if the deliverable produces no benefit. Always distinguish project success, meeting the constraints, from project management success, and both from benefit realisation, which is what the money was actually spent for.
Project life cycles
Two curves are worth remembering because they explain most of project management's structure. Cost and staffing rise, peak and fall across the life cycle. And the ability to influence the outcome is highest at the start when least is known, while the cost of change is lowest then and rises steeply, which is why time spent on definition is the highest-return time on any project.
Progressive elaboration
- Progressive elaboration is the iterative development of the project management plan in increasing detail as more accurate and specific information becomes available
- It is not scope creep: elaboration adds detail within the agreed scope, while scope creep adds scope without a corresponding change to time, cost and resources
- Rolling wave planning is the practical form: the near-term work is planned in detail and the distant work at a summary level, with detail added as the work approaches
- Estimate ranges narrow with elaboration, and the conventional bands are examinable: a rough order of magnitude estimate at initiation may be minus 25 to plus 75 per cent, and a definitive estimate later minus 5 to plus 10 per cent
- The management consequence: a budget approved on a rough order of magnitude estimate and then treated as a commitment is a governance failure, because the estimate was never capable of that precision
- The quality consequence: acceptance criteria elaborate too, so a requirement stated as 'user friendly' at initiation must become measurable before it can be verified
Development approaches
Development approaches compared
| Approach | Requirement certainty | Delivery | Suits | Kenyan illustration |
|---|---|---|---|---|
| Predictive | High | One delivery at the end | Construction, plant, infrastructure | A county water treatment works |
| Iterative | Medium | Repeated cycles refining one deliverable | Design-heavy work where the answer is discovered | A new product formulation developed through trials |
| Incremental | Medium | Successive usable increments | Where partial benefit is valuable early | A branch network rollout, branch by branch |
| Adaptive (agile) | Low | Frequent small deliveries in short iterations | Software, service design, anything with an uncertain requirement | A mobile application for customer self-service |
| Hybrid | Mixed | Different approaches to different components | Most real projects of any size | A plant upgrade with predictive civil works and adaptive control-system development |
- Named methodologies include PMBOK and the PMI approach, PRINCE2 with its seven principles, themes and processes, Scrum and Kanban within agile, and Lean and Six Sigma DMAIC where the project is an improvement
- The choice is a contingency decision, not a preference: it follows the certainty of the requirement, the rate of change, the regulatory environment, the contracting arrangement and the organisation's capability
- A common Kenyan constraint: public procurement under the Public Procurement and Asset Disposal Act, 2015 requires a defined specification for tender, which pushes public projects towards predictive approaches whether or not the requirement is actually certain, and this is a real source of variation claims later
Delivery cadence
- Cadence is the timing and frequency with which project deliverables are produced and handed over
- Single delivery: everything is delivered once, at the end. Appropriate for a building or a plant, where partial delivery has no value
- Multiple deliveries: components are delivered as they are completed, so benefit begins before the project ends
- Periodic delivery: deliveries on a fixed schedule, monthly or quarterly
- Continuous delivery: a constant flow of small deliveries, characteristic of mature software practice
- Cadence should be chosen on when the benefit can be realised, not on what is convenient to produce: a project whose whole benefit arrives at the end carries the whole risk to the end
- Cadence interacts with cash flow, since payment terms typically follow delivery, and a single-delivery project finances itself for its whole duration
Tailoring the approach
- Tailoring is the deliberate adaptation of the approach, governance and processes to the particular project and organisation. PMBOK is a body of knowledge, not a mandatory procedure, and applying all of it to every project is a characteristic failure
- What to tailor: the life cycle and development approach, the processes used, the level of documentation, the governance and approval structure, the reporting frequency and the tools
- Tailoring factors: project size, complexity, duration, risk and consequence of failure; the organisation's maturity and culture; regulatory and contractual requirements; team experience and location; and stakeholder expectation
- The test of appropriate tailoring: does each retained process change a decision that would otherwise be made worse? A process that produces a document nobody reads has failed the test
- Under-tailoring produces bureaucratic overhead on small projects, which teaches the organisation that project management is a burden; over-tailoring produces uncontrolled large projects
- Tailoring decisions should be recorded in the project management plan, so that a later auditor or reviewer can see what was omitted and why
Enterprise environmental factors
- Kenyan EEFs that recur across projects: exchange rate movement where equipment is imported; power reliability; road and logistics conditions affecting delivery to site; county-level licensing and approval timelines; NEMA environmental impact assessment requirements under the Environmental Management and Co-ordination Act, 1999; land acquisition and title; rainfall seasonality, which determines the construction window; and public procurement timelines where the client is a public entity
- The management response to an EEF is to plan around it, not to protest it: a project whose schedule ignores the rains has planned to fail
Portfolio prioritisation: selecting among competing projects
A Kenyan county has KES 480 million of capital budget and five
candidate projects requesting KES 940 million. Portfolio
management is the decision about which to do, and it is a
different question from whether each is individually sound.
SCORING CRITERIA, weighted by the county's own development plan
Strategic alignment weight 30
Beneficiaries reached weight 25
Financial return / cost
recovery weight 20
Deliverability (capability,
approvals, land secured) weight 15
Risk (lower is better) weight 10
Each scored 1 to 5.
PROJECT Cost Align Benef Fin Deliv Risk SCORE
(KESm) x30 x25 x20 x15 x10
A Water works 260 5 5 3 4 3
B Market building 140 3 4 5 5 4
C County offices 310 2 1 2 5 5
D Health centre 150 5 4 2 3 2
E Feeder roads 80 4 5 3 2 2
WEIGHTED SCORES
A = (5x30)+(5x25)+(3x20)+(4x15)+(3x10)
= 150+125+60+60+30 = 425
B = (3x30)+(4x25)+(5x20)+(5x15)+(4x10)
= 90+100+100+75+40 = 405
C = (2x30)+(1x25)+(2x20)+(5x15)+(5x10)
= 60+25+40+75+50 = 250
D = (5x30)+(4x25)+(2x20)+(3x15)+(2x10)
= 150+100+40+45+20 = 355
E = (4x30)+(5x25)+(3x20)+(2x15)+(2x10)
= 120+125+60+30+20 = 355
RANK BY SCORE ALONE: A 425, B 405, D 355, E 355, C 250
Selecting in that order: A (260) + B (140) = 400.
Remaining budget 80. D and E both cost more than... E costs
exactly 80, so A + B + E = 480. Budget exactly consumed.
Total score obtained = 425 + 405 + 355 = 1,185
BUT SCORE ALONE IS THE WRONG RANKING. Rank by score PER
SHILLING, since the constraint is money, not project count:
A 425 / 260 = 1.63 per KESm
B 405 / 140 = 2.89
C 250 / 310 = 0.81
D 355 / 150 = 2.37
E 355 / 80 = 4.44
Rank: E 4.44, B 2.89, D 2.37, A 1.63, C 0.81
Selecting in that order: E (80) + B (140) + D (150) = 370,
leaving 110, which is not enough for A (260).
Total score obtained = 355 + 405 + 355 = 1,115
The efficiency ranking obtains 1,115 against the raw
ranking's 1,185, so on these numbers the raw ranking wins.
That is not the usual result and it is worth understanding
why: A is expensive AND scores highest, so it uses the
budget efficiently enough in absolute terms. Where the
highest-scoring project is also disproportionately
expensive, the efficiency ranking usually wins.
The correct method is neither heuristic but to maximise
total score subject to the budget, examining the feasible
combinations:
A+B+E = 480, score 1,185 <- best
A+D+E = 490, over budget
B+D+E = 370, score 1,115, leaves 110 unspent
A+B = 400, score 830
A+D = 410, score 780
A+B+E is optimal.
WHAT PORTFOLIO MANAGEMENT ADDS BEYOND THE ARITHMETIC
1. C scores lowest and would be selected by nobody on merit,
yet county office projects are frequently built. Portfolio
discipline exists precisely to make that visible.
2. Deliverability is weighted, so E's weak score (2) on
approvals and land is a real risk to the selection: if E
cannot start, the budget is stranded. The portfolio should
hold a reserve list.
3. Interdependence must be checked: if the health centre (D)
depends on the feeder road (E) for access, they cannot be
ranked independently, which is when a PROGRAMME rather
than a portfolio decision is required.
4. The scores are judgements. Record who scored, on what
basis, so that the decision can be defended, which for a
county is a requirement of transparency under Article 201
of the Constitution and the Public Finance Management
Act, 2012.
Distinguish EEFs from OPAs in one sentence
Enterprise environmental factors are conditions outside the project's control that constrain it; organisational process assets are the organisation's own plans, templates, procedures and lessons that help it. EEFs are inputs the project must accept; OPAs are inputs the project uses and updates. Naming the distinction earns a mark that most scripts miss.
Self-check
Distinguish a project from an operation, a programme and a portfolio, giving a Kenyan example of each. (10 marks)
Explain four development approaches and advise which a Kenyan county should use for (a) constructing a market building and (b) developing an online single business permit system, with reasons. (10 marks)
Show worked answer
Project, operation, programme, portfolio (10 marks, 2.5 each).
A project is a temporary endeavour undertaken to create a unique product, service or result. It has a definite beginning and end and its deliverable differs from what has been produced before. Kenyan example: constructing a new water treatment works at a county utility.
An operation is ongoing and repetitive work producing the same output continuously, with no defined end. The relationship to a project is that the project creates the capability and operations run it. Example: the daily treatment and distribution of water once the works is commissioned.
A programme is a group of related projects, subsidiary programmes and programme activities managed in a coordinated way to obtain benefits not available from managing them individually. The coordination is the defining feature, and it exists because the components interact. Example: the county's water access programme, comprising the treatment works project, a distribution network extension project, a metering replacement project and a non-revenue water reduction project, whose combined benefit exceeds what each would deliver separately and which would conflict over the same crews and the same shutdown windows if managed independently.
A portfolio is projects, programmes, subsidiary portfolios and operations managed as a group to achieve strategic objectives. Its components need not be related to one another; what unites them is that they compete for the same resources and serve the same strategy. Example: the county's entire capital investment portfolio, comprising the water programme, road projects, health facility construction and an ICT programme, prioritised against one another within the county's development plan and budget under the Public Finance Management Act, 2012.
The distinguishing questions are: project management asks whether the project is being done right, programme management asks whether the projects together deliver the intended benefit, and portfolio management asks whether these are the right things to be doing at all.
Development approaches and advice (10 marks: 4 for the approaches, 6 for the advice).
Predictive: scope, schedule and cost are determined early and change is controlled against a baseline. Suits well-understood requirements and well-defined deliverables.
Iterative: the scope is known but the solution is developed through repeated cycles, each refining the same deliverable. Suits design-heavy work where the answer must be discovered.
Incremental: the deliverable is produced as a series of increments, each usable, so benefit begins before the project ends.
Adaptive or agile: iterative and incremental, with scope elaborated at the start of each short iteration and frequent delivery. Suits uncertain or rapidly changing requirements.
(a) Market building: predictive. The requirement is well understood, the deliverable is physically defined, the design must be complete before construction begins, regulatory approvals including planning and NEMA assessment require a defined design, and, decisively, procurement under the Public Procurement and Asset Disposal Act, 2015 requires a defined specification and bill of quantities to tender against. Partial delivery has little value: half a market building is not usable. Change should be controlled formally through variation orders, which is what a predictive approach provides. The tailoring that is appropriate is rolling wave planning of the fit-out and commissioning phases, whose detail can be added later.
(b) Online single business permit system: adaptive, or a hybrid with an adaptive core. The requirement is genuinely uncertain, because neither the county nor the applicants know precisely what the process should look like until they see something working, and requirements will change as the county's own by-laws and fee structures change during the build. Delivering in short iterations with real users allows the design to be corrected early and cheaply; delivering it all at the end guarantees that the first contact with reality occurs after the money is spent, which is how public information technology projects characteristically fail. Incremental delivery also lets benefit begin early, since permit types can be brought online one at a time. The practical constraint is procurement: a fixed-price contract tendered against a complete specification is incompatible with an adaptive approach, so the county should procure on a time-and-materials or milestone basis within what the Act permits, and structure the contract around an agreed capability and a defined governance process rather than a fixed feature list. The predictive elements, infrastructure procurement, integration with the payment gateway and data migration, can be planned predictively within a hybrid.