Chapter 11 • IT Project Management 411Even more common today is a program
management office (PMO), also referred to as a “project
office,” to ensure that projects in different stages of
completion are coordinated. The PMO is staffed with full-
time managers experienced in managing project budgets,
scheduling resources, and using tools that keep track of
projects across work teams and business stakeholders.
Their objective is to help ensure not only that projects are
run but also that interdependencies are taken into account.
The PMO might be a temporary unit set up for a large,
enterprise-wide systems project (e.g., a multiyear ERP or
other enterprise-wide systems projects described in
Chapter 5), a permanent unit within an IS organization, or
a permanent unit within a corporate office that serves many
functional areas.
Aprojectis a temporary endeavor under-
taken to create a unique product or service. It typ-
ically is a one-time initiative that can be divided
into related activities that require coordination
and control, with a definite beginning and ending.
Project managementis the application of
knowledge, skills, tools, and techniques to a
broad range of activities in order to meet the re-
quirements of a particular project.
Aprogramis a group of projects managed
in a coordinated way to obtain benefits not
available from managing them individually
(PMI, 2004).
AProgram Management Office (PMO)is
an organizational unit with full-time personnel to
provide a full range of standard approaches to
project management support and services that are
utilized across projects; lessons learned from
each project are collected from post-project
reviews and shared across project managers.In this chapter we first briefly discuss the growing issue
of how to manage an organization’s portfolio of IT projects;
we will return to this topic in Part 4 of this textbook. Then
we introduce the key project management roles and describe
in detail some approaches to managing the five processes of
an IT project once it has been prioritized and initially
funded: (1) project initiation, (2) project planning, (3)
project execution, (4) project monitoring and control, and
(5) project closing. This chapter discusses executing and
controlling projects in the same section. Our focus here is
two capabilities especially important for managing IT
projects: managing project risks and managing business
change.
The chapter ends with some guidelines for two
other project management issues important for IT
projects due to rapid changes in technology and the
need for expert user involvement in requirements
definition and implementation: (1) managing large,
complex IT projects (e.g., enterprise system package
implementations) and (2) managing a project with
“virtual teams” (in which team members are geo-
graphically dispersed).IT Portfolio Management
As organizations have become highly dependent on inte-
grated data for their strategic and operational decision
making, there has been an increasing emphasis on a
portfolio approach to IT investments. IT portfolio
managementis typically the responsibility of a commit-
tee of senior business leaders and IT leaders who approve
and prioritize IT project requests for an entire organiza-
tion and then monitor progress on approved IT projects
until they are completed. An organization’s IT portfolio
usually includes investments in new IT applications as
well as IT infrastructure investments (i.e., networks,
servers, storage equipment, data warehouses) to support
these applications.
New IT project requests are typically submitted
using an organization-specific template for a business
case that captures the expected business benefits and
both the initial resource costs for the project and the
ongoing resource costs for maintaining the new system
(see the example in Figure 11.2). Most organizations
also want to review an initial return on investment (ROI)
analysis or other formal financial assessment to help the
committee of business and IT leaders assess what are the
right set of IT projects to work on (given the organiza-
tion’s current competitive environment) and what priori-
ty should they be given for resource allocation. For
large, complex projects, however, only a rough order of
magnitude (ROM) cost estimate may be possible at the
time of the initial request.
As part of the system prioritization process, an
evaluative categorization scheme for all projects of a
certain size is typically applied. One such scheme, based
on Denis et al. (2004), would categorize projects into four
buckets:- Absolute MustA mandate due to security, legal,
regulatory, or end-of-life-cycle IT issues - Highly Desired/Business-CriticalIncludes short-
term projects with good financial returns and
portions of very large projects already in progress