International project management
tapaswini
Chapter2IPM.pdf
THE CONTEXT OF INTERNATIONAL PROJECTS IN TERMS OF
ORGANIZATIONAL STRATEGY AND CULTURE
Chapter 2
HOW ARE INTERNATIONAL PROJECTS LINKED TO ORGANIZATIONAL STRATEGY?
An organization has a vision it pursues.
To achieve its vision, it has a kind of roadmap or plan: this is also called its strategy.
To implement its strategy, the organization uses (international) projects.
During the project and at the end of the project, the organization checks whether the project has delivered the desired results.
This is an ongoing cycle we also call strategic management cycle.
2
Project 3
Project 2 Strategic Management Cycle
Business
Planning
Communi-
cating
and
high-level
aligning
Feedback
and
Learning
Translating
the Vision/
Mission 1
3 2
Project 1
4
Executing
Completing
Planning
Initiating
How (international) projects are part of the organization’s
strategy
3
THE CONNECTION BETWEEN (INTERNATIONAL) PROJECTS AND (INTERNATIONAL) PROGRAMS
A program can be defined as a bundle of projects.
Compared to a project, a program typically is bigger, requires more resources, and is crucial for the success of organizational strategy.
The projects within a program serve the same strategic objective.
Projects in a program are interdependent. They share the same objectives and scarce resources.
They typically have a common infrastructure and share a certain set of risks.
Programs have the following advantages: Ensuring strategic alignment through interdependency of objectives.
Reducing the complexity of ‘large projects’ by clearly breaking them down into smaller, easy-to control projects contributes to clearer responsibilities, minimizes risks, and boosts morale and motivation. It also improves the quality of the results.
Programs are essentially managed in the same way as projects.
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PROJECT PORTFOLIO MANAGEMENT (PPM)
A project portfolio is a collection of projects managed under one umbrella. These projects may be interrelated or not.
Purpose of PPM is to maximize the efficacy of projects in the light of strategy execution.
There are two main management processes within project portfolio management:
1. Selection and prioritization of projects.
2. Management of the projects within the portfolio by monitoring target achievement.
A project portfolio is periodically adapted to the organizational strategy.
The main activities of the PPM process are shown on the following slide.
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Required inputs:
1. Program/ project title
2. Project objective in light of
overall strategy
3. Risk level
4. Timeframe
5. Dependencies with other
programs/ projects
6. Estimated budget or ROI
7. Impact of not delivering the
program/project
1
3 2
4
Build or
Update
Project
Portfolio
Analyze
& Prioritize
Project
Portfolio
Monitor
& Adjust
Project
Portfolio
Consider
new
proposed
projects
The Project
Portfolio
Management
Process
1. Categorization of
program/project
3 . Organizational
capability and
capacity information
2. Program and project
information
1. Business requirements in
form of organization’s
strategy
3. Prioritization of programs/projects
according to criteria as:
•pressure from the market
•capability of the organization
•risks
•timescale for delivery
•impact of not doing the programs/projects
2. Determination of complexity
and challenge of portfolio
Required activities:
1. Monitoring objectives of single project
2. Monitoring combination of projects in
light of organizational success
3. Monitoring project selection in light of
change
Required tools & techniques:
Same as for project
management, cf. Chapter 7
Critical aspects to be monitored:
Required inputs:
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PROJECT MANAGEMENT MATURITY
An organization gains experience about project management over time.
Usually, the organization starts with single projects.
First, it develops an efficient way of project management.
Then, it reaches the stage in which projects perform well as an entirety.
The final stage is a continuous selection of projects which contribute to sustainable competitive edge of the organization.
The prerequisite for the last stage is well implemented and
smoothly working project portfolio management.
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- Existence of processes to measure project effectiveness and efficiency
- Continuous improvement of the efficiency of project portfolio management
- Project management processes integrated in the corporate processes
- Synchronization of projects with corporate strategy
- Solid analysis of project performance
- Standardization and institutionalization of project management
- Informal and unsystematic collection of project performance data
- Project estimates and schedules based on industry standards
- Introduction of a structured project management methodology
- Inconsistent application (mainly for large visible project)
- Many ad-hoc processes in the organization
- Awareness development through senior management regarding the importance of structured project management
Level
5
Level
1
Level
4
Level
3
Level
2
In c re
a s e o
f p ro
je c t m
a tu
ri ty
Example of a 5 stage project management maturity model
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PROJECT MANAGEMENT AND ORGANIZATIONAL CULTURE
Organizational culture can be defined as the way an organization is doing things.
A critical success factor of international projects is a supportive project culture.
This has to be based on ethnorelativism: values as open mindedness, respect, and trust.
Organizational culture goes like a common theme through projects, programs, and project portfolios.
All members of the organization need to have a special set of values, attitudes, and behaviours in order to help the implementation of the organizational strategy.
Strategy and culture need to be in tune for maximal organizational success.
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4. Employee
welfare,
fairness and
trust
1. Degree of
internal
integration
5. Diversity
2. Autonomy
and
involvement
3. Adaptability:
speed,
innovation and
risk
ADEQUATE ELEMENTS OF ORGANIZATIONAL CULTURE FOR SUCCESSFUL INTERNATIONAL PROJECTS
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Project
Management
Program
Management
Project
Portfolio
Management
Management
by Projects
Main Content of
Concept
Managing a single
project efficiently
within given
organizational
constraints and
context.
Clustering projects
pursuing the same
objectives into a
program to support
alignment with
overall
organization’s
strategy and to
increase flexibility.
Clustering projects
into portfolios to
ensure alignment
with organization’s
strategy. PPM
supports
coordinated
resource allocation,
increases flexibility
of the whole
organization and
leads to sustainable
project success.
Managing the whole
organization as a
bundle of projects
based on a
supportive
organizational
culture. At the
extreme, the
organization
consists of one
complex project.
Scope
Limited to a set of
objectives linked to
one single project.
Business-unit or
organization-wide,
depending on
content of program.
An organization-
wide management
system.
A management
approach affecting
the whole
organization, also
inter-organizational.
Required Project
Maturity Level
Level 1 – 3:
Minimum level 1,
ideal level 3
Level 3 – 4 Level 4 – 5 Level 4 – 5
Overview of relevant project management methods – all aiming at
strategy implementation
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