Revisiting "What is a Project?"
From the
Risk Analysis Perspective

David T. Hulett, Ph.D.¹

Background

The "Guide to the Project Management Body of Knowledge" (PMBOK) recently-issued by the Project Management Institute (PMI) starts with a definition of a project which puts the technical / performance objective as primary. This definition does not fit very well some efforts that are commonly thought of as projects for which cost and / or schedule objectives are paramount. These projects should be included explicitly in the definition, because:

Project managers claim that the standard approach to project management does not work for "my project," but are then left without an alternative approach.
Project managers may be managing their projects with tools that do not readily apply.

The issue of definition arises because there are multiple objectives in every project, generally catalogued as (1) cost (2) schedule (3) performance / technical. In fact, people typically talk about how much it will cost and how long it will take to complete the technical aspects or specifications of the project, objective # 3 above. This is the thrust of the PMBOK definition. Some projects emphasize cost and/or schedule goals, however, and it is not clear that all projects meet our definition.

Because the three types of objectives are intimately interrelated, emphasizing one goal or another tends to imply that the others are fluid, flexible and perhaps optional. These issues are particularly challenging in trying to interpret the implications of a cost or schedule risk analysis.

ThePMBOK Definition

The PMBOK says "a project is a temporary endeavor undertaken to create a unique product or service."² It goes on, saying that temporary means that "every project has a definite beginning and a definite end. The end is reached when the project's objectives have been achieved, or when it becomes clear that the project objectives will not or cannot be met and the project is terminated. "The project ceases when its declared objectives have been attained."

Uniqueness is defined as a project which involves "doing something which has not been done before and which is, therefore, unique " When properly defined, the scope of the project the work to be done should remain constant even as the product characteristics are progressively elaborated."

From these sentences, it is clear that the scope of work (SOW) is the primary objective. The PMBOK implies that a project is defined by its tasks and that you can tell when it is done by the completion of such tasks (begging the question of change orders).

In reality, projects are not all so neatly classified, yet they are projects, too. Also, since some projects do not fit easily into this mold, our project management tools, which are attuned to accomplishing the technical objective, do not always work as well as they should. I will illustrate two of these projects and show how they impact standard project risk management methods.³

Schedule-Limited Projects

Schedule-limited projects also pose some specific project management challenges. These are not just your everyday problems meeting tight schedules; every project has schedule problems. These projects may have a special characteristic related to some "drop-dead date" that comes from considerations outside the project boundaries. Getting a naval ship back into service when the chief of naval operations (CNO) dictates their retrofitting is to be complete, or completing a software installation before the year 2000 may be such projects.

Schedule-limited projects' SOW and costs may both be fluid. Subject to some basic must-have components or specifications, the operating organization may be willing to just "declare victory" at the drop-dead date, accepting what is complete as of that point as the definition of the project's technical / performance objectives, the SOW. Alternatively, the owner / customer may just pile on the resources without limit trying to complete the project. But, these projects are destined to be declared complete as of the determined date, whether the originally-desired work is done or not. (Sometimes a Phase II is created for the unfinished SOW.)

A schedule risk analysis of a schedule-limited project measures the risk of overrunning the strict deadline. Since, however, the completion date is strictly determined in advance, the schedule risk of schedule-limited projects is really a performance / technical risk or a cost risk analysis, and the SOW and/or budget surely does not remain constant (even with change control). Are these schedule-limited efforts projects to the PMI? Of course, they should be encompassed in our definition.

Technical / Performance-Driven Projects

These two types of projects are joined by a class of projects in which the technical or performance characteristics are sacrosanct. In these cases, cost and schedule goals may be in jeopardy, because the schedule may never be completed, or the cost may be uncontrolled seemingly to infinity. This is the more common ideal project definition and is evoked by the PMBOK definition.

Revising the PMBOK Definition of a Project

Why should just one project objective determine whether the endeavor is a project or not? The danger with the current PMBOK definition is that it focuses too much on a constant (or change-controlled) statement of work, the technical / performance objective. "[T]he project ceases when its declared objectives have been attained." Which objectives qualify as the project descriptor? For some projects, these are cost or schedule objectives. In reality, different organizations march to different drummers, and get their benefits from achieving different objectives. These latter objectives are perhaps even more difficult to manage and clearly deserve PMI attention. Certainly, they should not be defined out of our scope as less than a project, or worse a poorly managed project.

¹© 1999 by David Hulett. The author is Principal, Hulett & Associates, Project Management Consultants of Los Angeles, CA. Hulett & Associates can be reached at (310) 476-7699 or info@projectrisk.com.
²PMBOK, Project Management Institute, 1996. The quotations are from pp. 4-5, sections 1.2.
³Other project management tools that work less well in projects emphasizing time or cost objectives include critical pat method scheduling and earned value measurement.
This paper was published in the Project Management Journal, Vol. 28, No. 1, March 1997, Correspondence, pp. 53-4. The Project Management Institute, Upper Darby, PA, is a worldwide organization advancing the state-of-the art in project management, (610) 734-3330.