PROJECT AND CONTACT MANAGEMENT STUDY NOTES
Contents
Topic 1: Introduction to project management
Topic 2: What is a project life cycle?
Topic 3 Project planning
Topic 4 Contract management
Topic 1: Introduction to Project Management
What Is A Project?
A project is a complex of activities where resources are used in expectation of returns. It
intends to achieve specific objectives. It has a sequence of investments and production
activities and a specific group of benefits that can be identified and valued either socially or
monetarily.
Key Characteristics of Projects:
1. Has an objective: A definable result, output or product that is typically defined in terms
of cost, the quality and timing of the output from the project activities.
2. Complexity: many different tasks are required to be undertaken to achieve a project’s
objective. The relationship between these tasks can be complex.
3. Uniqueness: a project is usually a ‘one-off’ not a repetitive undertaking. Even repeat
projects e.g. road construction to the same specification, will have differences in terms of
resources used & the environment.
4. Temporary nature: has a start and an end
5. Life cycle: Conception, planning and organizing phase, implementing, closure and
handover.
6. Customer specific nature: a project is always made to the order of its customer who
specifies the requirement
7. Sub-contracting: the more the complexity of the project ,the more the extent of sub-
contracting
8. Risk and uncertainty: The degree of uncertainty will depend on how a project has passed
through its various life cycle phases
9. Team work: a project calls for team work from members of various disciplines
(profession), organizations and sometimes countries all working together to meet the
project goals.
10. Control mechanism: like time schedule, cost, so as to achieve the desired level of quality
and reliability.
What Is Project Management?
Project Management is the process of achieving project objectives (schedule, budget and
performance) through a set of activities that start and end at certain points in time and
produce quantifiable and qualifiable deliverables. Successful project management is the art of
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 1
,understanding the requirements of the project, identifying the deliverables that produce the
solution, assigning ownership of the deliverables, identifying the tasks to accomplish the
deliverables, bringing together the resources and people necessary to accomplish the
objectives within the specified time constraints and within budget.
IMPORTANCE OF PROJECT MANAGEMENT.
The main purpose for initiating project management is to:
(i) Focus the responsibility and authority for the attainment of the goals on an individual
or a group.
(ii) Coordinate and integrate all activities that are responsive to the client and the
environment.
(iii) Identify and correct project problems at an early date to ensure competent
completion.
(iv) Make timely decisions about trade-offs between conflicting project goals.
(v) Products that are unique with a powerful competitive advantage over the competitors
are availed.
(vi) Inputs from diverse area of specialized knowledge help in developing new products,
processes and services.
(vii) Rapid expansion of technological possibilities is responded to satisfactorily.
(viii) Non-routine activities into project management ensure that accountability is
established, projects are properly planned and integrated with other related activities.
(ix) Ensure that managers of the separate tasks that comprise the project do not optimize
the performance of their individual tasks at the expense of the total project.
TYPES OF PROJECTS
Various types or categories of projects should be identified so that the mix of projects funded
by the parent organization will be spread appropriately across those areas making major
contributions to the organization’s goals.
The location, type, technology, size, scope and speed are normally the factors which
determine the effort needed in executing a project.
(i) Research and development projects-refers to the investigative activities a business
conducts to improve existing products and procedures or to lead to the development
of new products and procedures
(ii) Manufacturing projects- aim to produce piece of equipment or machinery or
consumable goods like soap, cooking fat etc.
(iii)Construction projects-Eg. roads, bridges, mining, quarrying
(iv) Turn-key projects.- a contract under which a firm agrees to fully design, construct
and equip a manufacturing/business/ service facility and turn the project over to the
purchaser when it is ready for operation for a remuneration. Turnkey means that the
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 2
, PM will only have to turn the key to have the business or project up running. See
BEYOND ZERO mobile clinicsPROJECT
(v) Derivative Projects. These are projects with objectives or deliverables that are only
incrementally different in both product and process from the existing offerings. They
are often meant to replace offerings or add an extension to current offerings.
(vi) Platform Projects. The planned outputs of these projects represent major departures
from the existing offerings in terms of either the product or service itself or the
process used to make and deliver it or both. As such, they become platforms for the
next generation of organizational offerings.
(vii) Breakthrough Projects. These projects typically involve a new technology than
platform projects. It may be a disruptive technology that is known to the industry or
something proprietary that the organization has been developing over time. Eg MPESA
PROJECTS ORGANISATION STRUCTURES
Def: Organizational structure which is also referred to as corporate structure refers to the
specifying of the format of an organization reporting relationships, procedures, controls,
authority and decision-making processes.
Def: It is also defined as a system of shared beliefs and values that develops within an
organization and guides the behavior of its members.
Proactive management of projects and contracts has come to realize that project structures
need to be dynamic and not static.
Organizational structures should have ability, capacity and capability of embracing rapid
restructuring when environmental conditions dictate otherwise.
There are no organizational structures which are bad or good but such structures can only be
appropriate or inappropriate.
FACTORS THAT INFLUNCE THE PROJECT ORGANISATION STRUCTURE
(a) Technological changes. Technological revolution may lead to complexity, varieties of
new products, development of new processes, new data, new labour competences, new
tools, new ideas etc and all these factors must be harmonized to ensure conformity,
compatibility and compliance with the ever-changing technologies in the market.
(b) Simplicity or complexity of the project. Resources required to implement a project
depend very much depend on how simple or complex a project is. A project
organizational structure therefore must be developed in such a way that the unique needs
of the client are addressed adequately, effectively and cost effectively.
(c) Nature of the product to be rolled out by the project. A project rolling out tangible goods
or services or works requires different and appropriate organizational structures if good
and satisfactory results are be achieved. Expected profitability or value for money plays
very crucial role in structuring the organization.
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 3
, (d) Market competition. The organization has to be structured in a way that will give it a
competitive edge over the competitors in the market as only fittest can survive in such a
market.
(e) Value of the project. The total project cost or value of money invested in the project gives
a proper guide on the most appropriate structure the project should adopt.
(f) Staff technical competences. Develop an organizational structure that the available staff
in the organization can conveniently, efficiently and effectively manage.
(g) Whether the organization is mechanistic or organic. The need for centralization or
decentralization of authority, making rules and procedures or fewer tasks, formalized
communication or internal communication etc. will to a great extent influence the most
appropriate structure to be adapted by an entity.
(h) Differentiation-integration dimension. The need for specialized technical competences
and division of labour plays a big role in deciding the appropriate structure an
organization may adopt.
(i) The size of the organization. The size of labour force on full time basis determines the
right structure an entity may adopt. Larger organizations tend to more formal, have more
rules, more regulations, increased job specialization, complex decisions to be made etc.
while smaller organizations tend to be more informal, have fewer rules and less need for
specialized technical competences. All these variables play very important role in
determining an organizational structure that will fit best a particular entity.
(j) The lifecycle stage of an organization. The stage at which an organization is very much
influences the right organizational structure. An organization at birth, youth, midlife and
maturity stages will have different organizational structures at each different stage of
lifecycle as the organization evolves from one stage to another.
SIGNS FOR NEED TO RESTRUCTURE THE PROJECT ORGANIZATION.
It is important to regularly and consistently identify and interpret red flags or early warning
signs that indicate the need for a new and better project organizational structure so as to
ensure that the project delivers maximum results.
Such signs may include but not limited to:
The project management team is satisfied with its existing members in respect of
knowledge, experience, efficiency and integrity but the project is not meeting lead time,
cost and related deliverables.
There is high commitment of getting the project work done competently but
performance not satisfying.
The key technical staff involved in the project management feel overworked, exploited
and misused.
Particular technical groups or individual project team members have tendency of
blaming each other for failure to meet specifications, lead time and costs.
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 4
Contents
Topic 1: Introduction to project management
Topic 2: What is a project life cycle?
Topic 3 Project planning
Topic 4 Contract management
Topic 1: Introduction to Project Management
What Is A Project?
A project is a complex of activities where resources are used in expectation of returns. It
intends to achieve specific objectives. It has a sequence of investments and production
activities and a specific group of benefits that can be identified and valued either socially or
monetarily.
Key Characteristics of Projects:
1. Has an objective: A definable result, output or product that is typically defined in terms
of cost, the quality and timing of the output from the project activities.
2. Complexity: many different tasks are required to be undertaken to achieve a project’s
objective. The relationship between these tasks can be complex.
3. Uniqueness: a project is usually a ‘one-off’ not a repetitive undertaking. Even repeat
projects e.g. road construction to the same specification, will have differences in terms of
resources used & the environment.
4. Temporary nature: has a start and an end
5. Life cycle: Conception, planning and organizing phase, implementing, closure and
handover.
6. Customer specific nature: a project is always made to the order of its customer who
specifies the requirement
7. Sub-contracting: the more the complexity of the project ,the more the extent of sub-
contracting
8. Risk and uncertainty: The degree of uncertainty will depend on how a project has passed
through its various life cycle phases
9. Team work: a project calls for team work from members of various disciplines
(profession), organizations and sometimes countries all working together to meet the
project goals.
10. Control mechanism: like time schedule, cost, so as to achieve the desired level of quality
and reliability.
What Is Project Management?
Project Management is the process of achieving project objectives (schedule, budget and
performance) through a set of activities that start and end at certain points in time and
produce quantifiable and qualifiable deliverables. Successful project management is the art of
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 1
,understanding the requirements of the project, identifying the deliverables that produce the
solution, assigning ownership of the deliverables, identifying the tasks to accomplish the
deliverables, bringing together the resources and people necessary to accomplish the
objectives within the specified time constraints and within budget.
IMPORTANCE OF PROJECT MANAGEMENT.
The main purpose for initiating project management is to:
(i) Focus the responsibility and authority for the attainment of the goals on an individual
or a group.
(ii) Coordinate and integrate all activities that are responsive to the client and the
environment.
(iii) Identify and correct project problems at an early date to ensure competent
completion.
(iv) Make timely decisions about trade-offs between conflicting project goals.
(v) Products that are unique with a powerful competitive advantage over the competitors
are availed.
(vi) Inputs from diverse area of specialized knowledge help in developing new products,
processes and services.
(vii) Rapid expansion of technological possibilities is responded to satisfactorily.
(viii) Non-routine activities into project management ensure that accountability is
established, projects are properly planned and integrated with other related activities.
(ix) Ensure that managers of the separate tasks that comprise the project do not optimize
the performance of their individual tasks at the expense of the total project.
TYPES OF PROJECTS
Various types or categories of projects should be identified so that the mix of projects funded
by the parent organization will be spread appropriately across those areas making major
contributions to the organization’s goals.
The location, type, technology, size, scope and speed are normally the factors which
determine the effort needed in executing a project.
(i) Research and development projects-refers to the investigative activities a business
conducts to improve existing products and procedures or to lead to the development
of new products and procedures
(ii) Manufacturing projects- aim to produce piece of equipment or machinery or
consumable goods like soap, cooking fat etc.
(iii)Construction projects-Eg. roads, bridges, mining, quarrying
(iv) Turn-key projects.- a contract under which a firm agrees to fully design, construct
and equip a manufacturing/business/ service facility and turn the project over to the
purchaser when it is ready for operation for a remuneration. Turnkey means that the
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 2
, PM will only have to turn the key to have the business or project up running. See
BEYOND ZERO mobile clinicsPROJECT
(v) Derivative Projects. These are projects with objectives or deliverables that are only
incrementally different in both product and process from the existing offerings. They
are often meant to replace offerings or add an extension to current offerings.
(vi) Platform Projects. The planned outputs of these projects represent major departures
from the existing offerings in terms of either the product or service itself or the
process used to make and deliver it or both. As such, they become platforms for the
next generation of organizational offerings.
(vii) Breakthrough Projects. These projects typically involve a new technology than
platform projects. It may be a disruptive technology that is known to the industry or
something proprietary that the organization has been developing over time. Eg MPESA
PROJECTS ORGANISATION STRUCTURES
Def: Organizational structure which is also referred to as corporate structure refers to the
specifying of the format of an organization reporting relationships, procedures, controls,
authority and decision-making processes.
Def: It is also defined as a system of shared beliefs and values that develops within an
organization and guides the behavior of its members.
Proactive management of projects and contracts has come to realize that project structures
need to be dynamic and not static.
Organizational structures should have ability, capacity and capability of embracing rapid
restructuring when environmental conditions dictate otherwise.
There are no organizational structures which are bad or good but such structures can only be
appropriate or inappropriate.
FACTORS THAT INFLUNCE THE PROJECT ORGANISATION STRUCTURE
(a) Technological changes. Technological revolution may lead to complexity, varieties of
new products, development of new processes, new data, new labour competences, new
tools, new ideas etc and all these factors must be harmonized to ensure conformity,
compatibility and compliance with the ever-changing technologies in the market.
(b) Simplicity or complexity of the project. Resources required to implement a project
depend very much depend on how simple or complex a project is. A project
organizational structure therefore must be developed in such a way that the unique needs
of the client are addressed adequately, effectively and cost effectively.
(c) Nature of the product to be rolled out by the project. A project rolling out tangible goods
or services or works requires different and appropriate organizational structures if good
and satisfactory results are be achieved. Expected profitability or value for money plays
very crucial role in structuring the organization.
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 3
, (d) Market competition. The organization has to be structured in a way that will give it a
competitive edge over the competitors in the market as only fittest can survive in such a
market.
(e) Value of the project. The total project cost or value of money invested in the project gives
a proper guide on the most appropriate structure the project should adopt.
(f) Staff technical competences. Develop an organizational structure that the available staff
in the organization can conveniently, efficiently and effectively manage.
(g) Whether the organization is mechanistic or organic. The need for centralization or
decentralization of authority, making rules and procedures or fewer tasks, formalized
communication or internal communication etc. will to a great extent influence the most
appropriate structure to be adapted by an entity.
(h) Differentiation-integration dimension. The need for specialized technical competences
and division of labour plays a big role in deciding the appropriate structure an
organization may adopt.
(i) The size of the organization. The size of labour force on full time basis determines the
right structure an entity may adopt. Larger organizations tend to more formal, have more
rules, more regulations, increased job specialization, complex decisions to be made etc.
while smaller organizations tend to be more informal, have fewer rules and less need for
specialized technical competences. All these variables play very important role in
determining an organizational structure that will fit best a particular entity.
(j) The lifecycle stage of an organization. The stage at which an organization is very much
influences the right organizational structure. An organization at birth, youth, midlife and
maturity stages will have different organizational structures at each different stage of
lifecycle as the organization evolves from one stage to another.
SIGNS FOR NEED TO RESTRUCTURE THE PROJECT ORGANIZATION.
It is important to regularly and consistently identify and interpret red flags or early warning
signs that indicate the need for a new and better project organizational structure so as to
ensure that the project delivers maximum results.
Such signs may include but not limited to:
The project management team is satisfied with its existing members in respect of
knowledge, experience, efficiency and integrity but the project is not meeting lead time,
cost and related deliverables.
There is high commitment of getting the project work done competently but
performance not satisfying.
The key technical staff involved in the project management feel overworked, exploited
and misused.
Particular technical groups or individual project team members have tendency of
blaming each other for failure to meet specifications, lead time and costs.
PROJECT AND CONTRACT MANAGEMENT NOTES BY MR. ANTONY AMBIA Page 4
