Implementing A Project Management System

INTRODUCTION

“A project is a complex non routine, one-time effort limited by time, budget, resources, and performance specifications designed to meet customer needs” (Gray/Larson Project Management)

Project Management (pm) is an evolving science. It is a flexible, efficient, innovative, and accountable way to get things done in today’s fast paced consumerist society. Pm is ideally suited to the business environment where product lead times are constantly being trimmed down, due to the rapid increase in global competition.

In the recent past, the general consensus in business was that strategic business and project management were two different disciplines. Strategy deals with the how’s of a business, how will it make profit? How will it grow? How will it attract new customers? By its nature PM is results orientated, it is how the strategy objectives are achieved. Today a new discipline is being employed, Strategic Project Management.

The first step in implementing a pm system is to align this style of management with the companies overall business strategy. Following this the firm must decide on the correct structure to use. Next, managers must create a culture within the firm where all employees share the company’s vision and accept this style of governance. The final two steps are implementing and evaluating the new system.

Over the following pages this report will examine, Strategy, Structure, Culture, and implementation & Evaluation individually. As this report deals with implementation of a project management system, the emphasis of the report is placed on the first three topics. The final section of this report examines a project management case study on Boeing, and the design of the new 777 aircraft. This case study gives working examples of good approaches, which are highlight in the report, to project management.

STRATEGY

“A managerial commitment to pursue a particular course of action”

(Thompson, Strickland, Gamble, Crafting & Executing strategy)

Today Strategic Project Management is emerging as the new business management science. Management as a science has been in existence since Frederick Taylor et al. created the classical business school, based on the following principles;

пÑ"ј division of labour

пÑ"ј division of functional processes

пÑ"ј division of structure

пÑ"ј division of control

The rationale of this thinking was to find the “single best way” of getting things done mainly through operational activities. Today most companies are proficient at reducing costs and achieving maximum efficiency. Therefore competitive advantage comes “from organisational agility which we define as the ability to quickly change and reconfigure your business in response to changes in your environment.” (Pat Millar, climbing the project management maturity ladder, lecture notes)

To address those needs modern day business principles have adapted to;

пÑ"ј Strategy

пÑ"ј Structure

пÑ"ј Processes

пÑ"ј Projects

The above principles are inter-linked, the aim is to create cross-border co-operation between all departments and to create the link between customers, company strategy making, and operational activities.

To successfully implement a project management system, it is imperative the firm takes an integrative approach. Forming a strategy to follow, “determines the core competencies of a business, and develops a strategic vision of the organisations direction while instilling the organisation with a sense of purpose, long-term direction and a clear mission” (PMWorld Today, 2006 vol. iv, issue 1)

It is essential project managers are brought in at the planning stage of top-level strategy decision making process. Project managers and project team members need to know the purpose of a particular project and understand how it compliments the companies overall strategy. This will enable the project manager to make correct, quick decisions which complement the company’s overall strategy. Knowledge of strategy and company goals will also give the manager the potential to motivate and inspire workers to commit to, and provide the necessary resources to successfully complete the project.

STRUCTURE

“The sum total of the ways in which an organisation can divide its labour into distinct tasks and then achieve co-ordination amongst them” (Mintzberg in PMWorld Today, 2006 vol. iv, issue 1)

The successful completion of a project is in itself not enough to call the project a success. Success depends on the integration of the outcome of that project into the operational functions of the business. A project is a unique one-time effort, by their nature they do not fit well with the daily repetitive tasks of operational management. A structure must be in place which balances the requirements of the project, with those of the organisation. There are three recognised structures to achieve this, which are project management; within functional operations, organised as dedicated teams, and matrix system.

Project management within functional operations

This is simplest and quickest type of pm system to introduce. The project is operated as an additional function within the existing departments. The accounting department is responsible for finance, sales dept deal with sales, etc… the overall management remains within the existing hierarchal system. In addition to being quick and easy to implement it also has the advantage of having natural expertise in that each department already have the necessary skills and knowledge to carry out the work involved.

Organising projects as dedicated teams

This system extends the hierarchical structure of the organisation. A project manager is appointed at the same level as upper/top management. It is this manager’s