Third Industrial Revolution

Third Industrial Revolution 1940-today

In the history of project management the "third" Industrial Revolution gradually grew from the use of information and was dominated by computers both electro-mechanical and electronic, and eventually the Internet. It also saw the institutionalization of management practices into business. A whole new industry develops around information technology. The transition of technological leadership continues from Europe to the United States.

The 1950s

Kaizen (Ky' zen) a Japanese business philosophy is brought to the Western corporate world by Masaaki Imai In his book "Kaizen: the Key to Japan's Competitive Success" (1986, McGraw-Hill). Imai defines it as: "a means of continuing improvement in personal life, home life, social life, and working life." The history of Kaizen starts in Japan in the 1950's when Toyota first implements quality circles into the production process. Kaizen is influenced by Armand Feigenbaum's book "Total Quality Control" in 1951, which details Total Quality practices. Also the influence of W. Edwards Deming ("Elementary Principles of the Statistical Control of Quality" in 1951), JM Juran ("Quality Control Handbook" in 1951), and Kauru Ishikawa all these reshape Japanese business.

The development of both CPM and PERT gave project managers much greater control over massively engineered and extremely complex projects. This was vital for the military weapon systems evolving and the space race which began in 1957, one of the most complex and difficult projects undertaken by humans.

Bernard Schriever (1910-2005), the architect of the US Air Force's ballistic missile and military space program coins the term Project Management in 1954, later known as the “Father of Modern Project Management.”

Complex network diagrams called PERT (Program Evaluation and Review Technique) charts were invented as part of the Polaris missile submarine program in 1955. Booz-Allen Hamilton worked with the U.S. Navy to create these charts and schedules.

The Critical Path Method (CPM) was developed by the DuPont corporation in 1957, to deal with a variety of tasks and numerous interactions at many points in time.
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The science of ‘scheduling’ as defined by Critical Path Analysis (CPA) will celebrate its 50th Anniversary on the 7th May 2007. In 1956/57 Kelly and Walker started developing the algorithms that became the ‘Activity-on-Arrow’ or ADM methodology for DuPont. The program they developed was trialed on plant shutdowns in 1957 and the first paper on critical path scheduling was published in 1958. The critical meeting to approve this project was held on the 7th May 1957 in Newark Delaware where DuPont and Remington Rand jointly committed US$226,400 to fund the development. This date seems the most appropriate ‘start point’ for a development process that borrowed from previous research and developments and continues to this day.

The PERT system was developed by the US military in parallel with CPM, but lagged CPM by 6 to 12 months (although the term ‘critical path’ was invented by the PERT team). Later the Precedence (PDM) methodology was published by Dr. John Fondahl in 1961 as a ‘non-computer’ alternative to CPM. Arguably, the evolution of modern project management is a direct consequence of the need to make effective use of the data generated by the schedulers in an attempt to manage and control the critical path.

The 1960s

US Defense introduced some core project tools like earned value, and work breakdown structures. An intellectual interest in project management emerges. The construction industry begins to widely use modern project management tools and methods.

The 1970s

Project-based firms use project management as a permanent function. The Project Management Institute (PMI) and the The International Project Management Association (IPMA), are established to focus on project techniques. There is an emphasis on incorporating Time, Cost and Quality (TCQ), and triangulating the relationship between these with regard to the expected value to be received from the project output. There is also a focus on the growth in the importance of external factors.

The 1980s

The discipline matures and broadens to include risk management, Total Quality Management (TQM), partnering, and defining project success. The PM book of knowledge PMBOK is published and business begins to adopt the approach of “Management by Projects.”

The 1990s

The discipline pays more attention to business benefits (business case) of projects, not just production of outputs, standardization of project methodologies, and the introduction of certification. It also focuses on enterprise project management, the need to manage networks of projects, and improving project management in organizations through a maturity model.

The Software Engineering Institute (SEI) of Carnegie-Mellon University develops the influential “Capability Maturity Model” for software between 1986 and 1993.