o o P.I.I.M.T American University of Leadership Ahmed Hanane, MBA, Eng, CMA, Partner email: email@example.com Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall o o o o o o What’s a project? Examples of projects? Project Life Cycle? Dimensions of a project success? Reasons of project failures? Triple constraints? o How do we manage? o o o o o o o o o Scope Cost Issues Quality Communications Risks Changes Project Management Maturity (PMM) Models? o Center for Business Practices o Kerzner’s Project Management Maturity Model o ESI International’s Project Framework o SEI’s Capability Maturity Model Integration Project manager’s responsibilities The Organizational Context: Strategy, Structure, and Culture 02-04 After completing this chapter, students will be able to: 1. 2. 3. 4. 02-02 Understand how effective project management contributes to achieving strategic objectives. Recognize three components of the corporate strategy model: formulation, implementation, and evaluation. See the importance of identifying critical project stakeholders and managing them within the context of project development. Recognize the strengths and weaknesses of three basic forms of organizational structure and their implications for managing projects. After completing this chapter, students will be able to: 1. 2. 3. 4. 02-03 Understand how companies can change their structure into a “heavyweight project organization” structure to facilitate effective project management practices. Identify the characteristics of three forms of project management office (PMO). Understand key concepts of corporate culture and how cultures are formed. Recognize the positive effects of a supportive organizational culture on project management practices versus those of a culture that works against project management. Strategic management – the science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives. Consists of: o o o o 02-07 Developing vision and mission statements Formulating, implementing and evaluating Making cross functional decisions Achieving objectives o Why do some firms succeed while others fail? o o What is strategy? o o An action a company takes to attain superior performance. What is the strategic management process? o 1-8 A central objective of strategic management is to learn why this happens. The process by which managers choose a set of strategies for the enterprise to pursue its vision. Strategy Strategic vision Winning competitive battles through deciding how to leverage internal resources, capabilities, and core competencies. Strategic Mission An application of strategic vision in terms of products to be offered, the way and markets to be served. What? How? Who? Example of visions statements Amazon "Our [Amazon's] vision is to be earth's most customer centric company; to build a place where people can come to find and discover anything they might want to buy online." (Quoted from Amazon.com) Hair Salon “Our salon will change the way you think about a haircut. Full service comfort, friendly staff, a relaxing atmosphere, and the best prices in town give you an experience that will leave you glowing both inside and out.” Example of missions statements Facebook: Facebook’s mission is to give people the power to share and make the world more open and connected. Google: Google’s mission is to organize the world‘s information and make it universally accessible and useful. Microsoft: Microsoft’s mission is to enable people and businesses throughout the world to realize their full potential. Skype: Skype’s mission is to be the fabric of real-time communication on the web. Yahoo!: Yahoo!’s mission is to be the most essential global Internet service for consumers and businesses YouTube: YouTube’s mission is to provide fast and easy video access and the ability to share videos frequently Basic Strategic Planning Model Defining the Mission and Setting Top-Level Goals External Analysis of Opportunities and Threats Internal Analysis of Strengths and Weaknesses Selection of Appropriate Strategies Copyright © 2001 Houghton Mifflin Company.Implementation All rights reserved. 1-12 of Chosen Strategies o o o Badouiya is a newly created business that produce and commercialize Argan products for cosmetic use. Our argan products are extracted from freshly harvested kernels from the fruits of the Argane tree. Pressed when cold, the kernels are then filtered to extract our aromatic oil. As a result, it does not have the nutty aroma and is almost odourless. It takes 30 kg of fruits and more than 15 hours work to produce 1 litre (33,40 fl oz) of oil. The task is carried out exclusively by Berber women. Argan oil can be used as an aliment or cosmetically. It enriches the skin and protects its elasticity. It is rich in natural ingredients which play a role of primary importance in the renewing of cell structure. In traditional Moroccan medicine, Argan oil was used for the care of body and face to counteract the effects of age and weather. It works wonderfully on wrinkles and dry skin, reduces visible scars left by acne, chicken pox, and spots and other damage like chapped, cracked skin and on burns and scalds. When used also for the care of the scalp, it restores shine to dull, lifeless hair and it strengthens brittle nails. Lastly it can relieve the pain occurring in joints and is very suitable for massage. o o o Mission Vision Three strategic goals Projects are stepping stones of corporate strategy The firm’s strategic development is a driving force behind project development Some examples include: A firm wishing to… …may have a project redevelop products or processes to reengineer products or processes. changes strategic direction or product portfolio configuration to create new product lines. improve cross-organizational communication & efficiency to install an enterprise IT system. 02-015 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall Mission Objectives Strategy 02-016 Goals Programs Figure 2.2 Mission “… the business of supplying system components to a worldwide nonresidential air conditioner market.” FIGURE 2.3 Illustrating Alignment Between Strategic Elements and Projects Strategies a. b. c. Existing products in existing markets with image maintenance Existing products in new markets (foreign, restricted) New products in existing markets (significantly improve image) Objectives a. b. c. 14.5% ROI Non-decreasing dividends Socially-conscious image Goals Programs Year 1: 8% ROI, $1 dividend, maintain image, unit cost down 5% Year 2: 9% ROI, $1 dividend, improve image Year 3: 12% ROI, $1 dividend, improve image Year 4: 14% ROI, $1.10 dividend 1. Product Cost Improvement Program (PCIP) 2. Image Assessment Program (IAP) 3. Product Redesign Program (PRP) 4. Product Development Program (PDP) Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 02-07 Using the same strategic goals you worked on before, make a list of three possible projects and discuss them with your calssmates Stakeholders are all individuals or groups who have an active stake in the project and can potentially impact, either positively or negatively, its development. Sets of project stakeholders include: Internal Stakeholders • Top management • Accountant • Other functional managers • Project team members 02-019 External Stakeholders • Clients • Competitors • Suppliers • Environmental, political, consumer, and other intervener groups Stakeholders: Groups who are affected by a firm’s performance and who have claims on its wealth The firm must maintain performance at an adequate level in order to maintain the participation of key stakeholders Firm Product Market Primary Customers Suppliers Capital Market Stock market/Investors Debt suppliers/Banks Organizational Employees Managers Non-Managers Stakeholder Involvement Each of the key stakeholders wants a piece of the same pie 1 How do you divide the pie in order to keep all of the stakeholders involved? 2 How do you increase the size of the pie so that there is more to go around? Stakeholders assessment Figure 2.4 02-023 1. 2. Assess the environment Identify the goals of the principal actors 3. Assess your own capabilities 4. Define the problem 5. Develop solutions 6. Test and refine the solutions 02-24 1. Identify Stakeholders 7. Implement stakeholder management strategy 2. Gather information on stakeholders 6. Predict stakeholder behavior 3. Identify stakeholders’ mission 5. Identify stakeholder strategy 4. Determine stakeholder strengths and weaknesses Figure 2.5 02-25 o Use stakeholder template to identify internal and external stakeholders for our small business of Argan products and your involvement strategy Consists of three key elements: 1. Designates formal reporting relationships o o 2. Identifies groupings of: o o 3. number of levels in the hierarchy span of control individuals into departments departments into the total organization Design of systems for o o o effective communication coordination integration across departments 02-27 o o o 02-28 Functional organizations – group people performing similar activities into departments Project organizations – group people into project teams on temporary assignments Matrix organizations – create a dual hierarchy in which functions and projects have equal prominence 02-29 Figure 2.6 Strengths Weaknesses 1. Firm’s design maintained 1. Functional siloing 2. Fosters development of in-depth knowledge 2. Lack of customer focus 3. Standard career paths 3. Projects may take longer 4. Project team members remain connected with their functional group 4. Projects may be suboptimized 02-30 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 02-31 Figure 2.7 02-32 Figure 2.8 Strengths 1. Project manager sole authority Weaknesses 1. Expensive to set up and maintain teams 2. Improved communication 2. Chance of loyalty to the project rather than the firm 3. Effective decision-making 4. Creation of project management experts 3. No pool of specific knowledge 5. Rapid response 4. Workers unassigned at project end 02-33 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall Figure 2.9 02-34 Strengths Weaknesses 1. Suited to dynamic 1. Dual hierarchies mean environments two bosses 2. Equal emphasis on 2. Negotiation required in project management and order to share resources functional efficiency 3. Workers caught between 3. Promotes coordination competing project & across functional units functional demands 4. Maximizes scarce resources 02-35 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall o 1. 2. 3. It has been three years, our small business grew and currently have customers in USA, Canada, Europe and Morocco. Its sales exceed 1M dhs. It has three projects alinged with its strategy: Launch of hair products Set up a distribution office in North America Expand its manufacturing capabilities in Agadir In a team of two, propose a project structure and share with us your arguments ………………… 10 min Organizations can sometimes gain tremendous benefit from creating a fullydedicated project organization Lockheed Corporation’s “Skunkworks” o o o 02-37 Project manager authority expanded Functional alignment abandoned in favor of market opportunism Focus on external customer 02-38 Figure 2.10 Centralized units that oversee or improve the management of projects Resource centers for: o Technical details o Expertise o Repository o Center for excellence 02-39 o o o 02-40 Weather station – monitoring and tracking Control tower – project management is a skill to be protected and supported Resource pool – maintain and provide a cadre of skilled project professionals o Performs four functions: o Establishes standards for managing projects o Consults on how to follow these standards 02-41 o Enforces the standards o Improves the standards 02-42 Figure 2.11 The unwritten rules of behavior, or norms that are used to shape and guide behavior, is shared by some subset of organization members and is taught to all new members of the company. o o o o Unwritten Rules of behavior Held by some subset of the organization Taught to all new members 02-43 o o o o o o o 02-45 Technology Environment Geographical location Reward systems Rules and procedures Key organizational members Critical incidents o Departmental interaction o Employee commitment to goals o Project planning o Performance evaluation 02-46 o o o o 02-47 Understand how effective project management contributes to achieving strategic objectives. Recognize three components of the corporate strategy model: formulation, implementation, and evaluation. See the importance of identifying critical project stakeholders and managing them within the context of project development. Recognize the strengths and weaknesses of three basic forms of organizational structure and their implications for managing projects. o o o o 02-48 Understand how companies can change their structure into a “heavyweight project organization” structure to facilitate effective project management practices. Identify the characteristics of three forms of project management office (PMO). Understand key concepts of corporate culture and how cultures are formed. Recognize the positive effects of a supportive organizational culture on project management practices versus those of a culture that works against project management.