Every project needs management for two reasons. The rst is to plan and
manage the tasks of a project and to coordinate getting the work done.
The other is to optimize the value of a project as an investment. Managing
projects as investments is the new frontier of project management. This
book is focused on introducing the tools and methods for optimiz-
ing projects as investments. Texts such as my 1999 Total Project Control:
A Manager’s Guide to Integrated Project Planning, Measuring, and Tracking
(Wiley) are aimed primarily at the rst function of project management—
managing the workand are written for the “practitioners” of project
management: project managers, cost account managers, activity leaders,
and all project team members. This book is for both the practitioners and
for anyone in a project-driven organization who has responsibility for or
is affected by projects.
This includes, but may not be limited to
Executives in project-driven organizations, who sense that programs
and projects are investments and want to shift their focus to under-
standing them as investments
Sponsors/senior managers, whose limited budgets must fund projects
Business area directors, whose portfolios may include multiple projects
Program managers, whose responsibilities usually include generat-
ing value from a coordinated implementation of related project and
nonproject efforts
Customers of projects, especially those projects performed on a con-
tractual basis
Professionals in contracts departments, responsible for writing
or amending requests for quotes (RFQs), requests for proposals
(RFPs), and performance contracts for project and subproject ven-
dors and customers
Business analysis, nance, and accounting professionals, who
should be responsible for quantifying and tracking both project
cost and project expected and generated value, as well as revenue
xii Preface
Acquisition professionals, who must understand the signicance to
project teams of delays in obtaining resources needed on the criti-
cal path
Human resources, who must understand both the urgency of
timely recruitment efforts as well as the need for corporate staff-
ing levels, procedures, and incentives that recognize and facilitate
critical path progress
The current edition of the Project Management Institute’s Guide to the
Project Management Body of Knowledge (PMBOK
Guide) has a new section,
not included in previous editions, on what it terms business value, and links
it to portfolio, program, and project management. This is recognition, in
the most important and widely used project management book, of this
new central concept in project management. The major focus of this book
is to explain how to use this concept and apply it to plan, measure, track,
and optimize the business value of a project. I do that using methods that
I have been developing and testing in consulting to project-driven organi-
zations in many industries for more than 25 years.
This book addresses the needs of project managers and team mem-
bers by providing specic methods that allow them to manifest their
value by seeking and nding opportunities to improve project results.
But, as important, it shows the executives and all senior managers how to
change current processes and metrics that generate inertia and a lack of
initiative. Instead, they must encourage processes where projects are mea-
sured on the basis of the value they contribute, and where team members
have the incentive to seek and recognize value-adding opportunities that
increase the strength of the organization.
Because Total Project Control was intended for the practitioner, it not
only introduced a new approach supported by new techniques, but it
delved deeply into each. It explored the different techniques for develop-
ing a value breakdown structure (VBS) and for computing critical path
drag in network schedules with complex dependencies and lags. Indeed,
what was then the brand-new concept of drag and how to compute it is
probably the topic that gained that book the most attention and it remains
the metric with which I am most identied. In this book, we mention the
VBS and discuss critical path drag, but only explore it in simple networks,
sufcient to show the importance of the concept and explain its crucial
investment corollaries of drag cost and true cost. Anyone with questions
about computing drag in complex networks should refer to the previous
book, Total Project Control.
This book focuses on the why and the how: why we need to start
managing projects in the same terms that we use for all other investments
and how the unique qualities of a project (work identication, schedule,

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