The Pertinent Issues Affecting a Project Organization - Term Paper Example

 Project Management Report Table of Contents 1.0Introduction 1.1The Macro Environment 1.2How effective are the management structures and processes currently used What deficiencies require attention? 2.0Within the projects themselves, are the current project management processes and  methods effective, or are there deficiencies? 3.0Conclusion 1.0Introduction Today’s business environment has increasingly become more turbulent, chaotic and challenging than ever before and to survive, it is vital that a firm can do something better than its competitors ( Wonglimpiyarat 2004:1). Globalisation has not only altered the nature and the intensity of competition but has had to dictate and shape organisations in terms of what consumers wants, how and when they want it and what they are prepared to pay for it (Hagan 1996:1). Kanter (1995:71) on his work of “Mastering Change” argues that success in the present day business is not for those companies that re-engineer the way they do things, or for those fixing the past. According to Kanter (1995) such an action will not constitute an adequate response. This is so because success is based on an organisation’s ability to create, rather than predict the future by developing those products that will literally transform the way the world thinks and view it self and the needs (Kanter 1995:71). Within the context of today’s global competition, businesses and firms no-longer compete as individual companies but try to corporate with other businesses in their activities (Wu & Chien 2007:2). These researchers went further to argue that, this strategy has become quite common in many businesses and in project management it is becoming a best practice. The conventional vertical integrated company based business model is gradually being replaced by collaborative relationship between many fragmented, but complementary and specialized value stars and constellation (Wu & Chien:1). Having said these, this report focuses on some of the pertinent issues affecting a project organization. The report first of all examine the changing environment of the contemporary organization, there after attention is shifted to the evaluation of the current management structure being used by my organization. The third part of the report focuses on the current project management processes in an organization to see if they are effective or there exist certain deficiencies. The last part of the report present recommendation in the form of a conclusion. 1.1The current Business Environment In business, environmental analysis is an appreciation of an organisations activities vis-à-vis its environment (Lin& Lee 2006). Such analysis has become imperatively necessary in the light of increase competition as present, subsequent operations and strategies direction will be dependent on the result (Lin& Lee 2006). According to Johnson et al (2007), it is a process by which a business gathers information from the environment to achieve a sustainable competitive advantage. In analysing the environment, the tool kits frequently used include The PESTLE Framework Macro environmental influences can better be explained by the use of the PESTEL framework. According to Johnson et al (2006) the PESTEL framework is a framework that can be used to categorise the factors that influence the business environment of an organisation into six main types including: Political Influences, Economic influences, Technological influences, Socio-cultural Influences, Environmental influences, and Legal influences. Hill (2007) argues that, the current business environment is being shaped mainly by the forces of globalization and the commitment of individual organizations towards sustainable development. Today, the forces of globalization, the interdependency of the economies and movement of factors of production across borders which has caused both threats and opportunities to some organization as ours. For example the current financial crisis in the United States if being felt by businesses the world over. Here some researchers (e.g., Kanter 2004) have argued that, success is not for those to reengineer things, but for those who think with respect to environment. Economic Factors All the economic factors can be regarded to have an impact on the construction industry. For example, high unemployment rate, high inflation rates, low GNP trends and slumps in the business cycle will imply low disposable income, more dependence by the citizens on credit facilities, borrowed funds and thus alternative sources of finance. The US dollars is currently falling at an increasing rate when compared to the British pounds, this will mean an increase in the currency exposure. Transaction and translation cost will be high in the UK, value of credit facilities if granted in UK pounds will fall. The value of construction companies assets in the US will increase when doing reporting in the parent company currency, the British pounds. What is the income distribution? what is it that other construction companies offer that, others don’t? The future budget situation of the UK government? Is the government striving at a surplus, deficit, or balance? All these are combined economic factors with huge impact on the activities of the construction companies . Socio Political Factors Under socio political factors construction projects and industry is affected by both taxation and social welfare policies. Given the fact that consumer’s income is dependent on government taxation policies, it is evident that take home income might either increase or reduce depending on the taxation policies adopted by the government at anyone time. In addition, government spending is greatly affected by its taxation policy. Though, the political situation of the UK is a stable and unique one, it over dependence through support of the US egoistic policies under the pretext of democracy, the war on terror, the teeth for tat with Iran makes the country looks unstable; with the present Democratic government facing difficulties because of the war in Iraq, current faith of world politics depends on the US and the United Kingdom (UK) with the two countries likely to be targets of terrorism attack. This institute a great fear especially in the minds of construction workers who fear to risk their life. 2. Environmental Factors Today with increasing call and consumer’s preference for green marketing, construction companies must develop environmental friendly products, products that are environmentally certified. Their works as houses, bridges, roads and other construction works must be environmentally friendly. In the absence of these options, mobile phone companies will be considered socially irresponsible. Under environmental factors I consider waste disposal, energy consumption and environmental protection laws in the UK to have a great impact on construction projects. Emphasis on development of projects which have less impact on the environment has increased during the recent years. Growing awareness among the public and the stakeholders has increased the pressure on corporations to increase their commitment towards social responsibility at large and responsibility towards greener environment in particular. This factor can specifically affect the construction industry as there is a trend to build constructions which have less carbon foot printing. Commercial buildings can consume up to 30% of the power in some countries (Hill 2007). How understanding of the external environment can help a firm improves on its competitiveness An organisation does not exist in isolation. Under the resource based view, it is thanks to the environment that new resources are sourced out; stakeholders interactions are facilitated, new partnership develop and created. Through and understanding of the external environment, firms take advantage of the resources available in its environment; define the nature and structure of its activities. In order to maintain service, quality and logistic standards, companies periodically audit their environment and compared to overall corporate performance through benchmarking. Companies that, fail to take advantage of its environment will lag behind. Today, the requirements of an organisation’s stakeholders including, customers, employees, suppliers, shareholders, government, etc are on a continuous rise. It is only through an environmental assessment that companies understand and take advantage of this. In addition, , to providing an annual report to the company’s shareholders organisations are expected to provide alongside a corporate social responsibility report that details how they interact with society and the environment in which they operate. Failure would be interpreted as irresponsibility. 1.2How effective are the management structures and processes currently used What deficiencies require attention? This part of the report assesses the current management structure currently being used using the SWOT analysis. Scope of the project (three stages required) 1) Planning stage, which involves the following; - The project initiation document (PID) - Identifying the stakeholders - Performing SWOT analysis - Create ‘work breakdown structure (WBS)’ - Establish management responsibilities 2) Execution of the project plan involves the following; - Main focus on scope and objectives - Completion ‘sign-off’ 3) Project ‘close-out’ involves the following; - Conduct ‘post-implementation Audit’ - Write up as historical records - Lessons learned Quality of the project (four stages are required) 1. Planning stage involves the following; Project initiation document (PID) Define project objectives Set quality criteria -Establish quality control 2. Execution of the project plan stage involves the following; Monitor activities 3. Change management stage involves the following; Control/change activities 4. Project ‘close-out’ stage Write up as historical records Identify lessons learned Timing of the project (Four stages required) 1. Planning stage involves the following Work breakdown structure (WBS) Sequence activities Estimate activity duration Estimate resource requirements Perform network analysis Perform resource levelling Establish baseline Gantt schedule 2. Execution of the project plan involves the following Monitor schedule activities 3. Change management stage; Identify slippage Control/change activities 4. Project ‘close-out’ involves the following Write up as historical records Identify lessons learned Cost of the project (Four stages required) 1. Planning stage involves the following; Cost/benefit justification Calculate cash flows Estimate total cost (from baseline Gantt schedule) Set cost baseline 2. Execution of the project plan stage involves the following; Monitor cost 3. Change management involves the following; Evaluate as costs and earned value Update cost baseline 4. Project ‘close-out’ involves the following; Write up a historical records Identify lessons learned This helps in implementation of strategy by giving the general guidelines and courses of action that have to be adopted by the team to achieve the objective. This gives a consistency in operations and thereby reducing the loss of resources in conflicts. Repeated analysis of same issue is avoided and thereby gives the management more time to concentrate on other areas of concern. It helps in implementation of strategy for project management because it helps better team work. When more than two teams come together to achieve a goal, which is often the case in project management, well set policies and procedures can cause less friction and thereby can produce better results. The present organizational structure can be defined as highly functional wit a market strategy. In such a structure, the project manager is able to maintain centralized control over functional activities and at the same time take advantage of low cost and enhanced quality from international suppliers. In addition, control over strategic direction is enhanced and functional redundancies are minimized. In order to ensure efficiency in the logistics process, project has integrated purchasing and distribution processes under one umbrella function. 3.0Conclusion and Recommendation Controlling and managing scope change is critical to the success of any project, as scope changes can significantly impact the cost, schedule, risk and quality of the entire effort. While scope is defined early in the planning and estimation phases, there are many reasons for changing it later on – for instance, a stakeholder may acquire additional insight into a problem during the course of the project. In addition to internal factors, external market conditions and government regulations often drive requests that extend beyond the initial project scope. The key to successful scope management is defining, communicating and reconciling emerging requests throughout project lifecycle. Change control is the process of handling proposed alterations to items that have been previously designated as fixed. This means that an item only becomes subject to change control once it has been signed-off, stored in a baseline and placed under configuration control. The aim of change is to ensure that if a signed-off item is changed then All stakeholders have an opportunity to participate in the control of any subsequent changes. All recipients are made aware of any changes that occur There is an audit trial which connects a change to a configuration item to the reason for its change, and which records the participation and authorisation of those people concerned with the change. Proper change control requires definition of the: a. Level of authority required to change each configuration item b. Methods for handling proposals for changing any configuration item. Likelihood Impact Nature of risk Description High/Low High/Low Action required Who? 1) Natural disaster Flood, earthquake, Low High Back-up should be kept Project manager Fire, etc In a different location. system development 2) Construction mistakes Service interruptions Low Low Each task of the project Project manager during construction, will be reviewed before moving to the next stage 3) System administration Adequate of High Low More staffs should be Project committee practices Knowledge, skills, trained and motivated & procedures Through incentive schemes. Project management and implementation is not a simple process. It needs a lot of planning in advance, managerial skill and also strong interpersonal skill by the team leader. The role of the team leader is very crucial because he is involved directly in designing the project and also in terms of addressing to the people in case of problem situations. When the project is successful, the team members are to be appreciated for their work, but when there are project hick ups, then the relationships of the team members have to be defined carefully and the polices have to be appraised for their effectiveness. Our caution to management is that, a key deliverable of justifying the current project is a feasibility study. Feasibility is a formal study to decide whether a full system project is justified and to decide what type of system would be feasible to be developed that meets the needs of the organisation. A feasibility study is important because it drives the development of your project proposal, which can be presented to senior management to gain their commitment to the project and to obtain project funding. References Hagan, M. C., (1996).The core competence organisation. Implication for Human Resource Practices. Human Resource Management Review Vol.6, No 2. 1996, Pp. 147-164 Kanter, R. M. 1995. “Mastering Change.” Pp. 71-83 in Learning Organizations: Developing Cultures for Tomorrow’s Workplace, edited by Chawla and Renesch.Portland, OR: Productivity Press Wu, S. & Chien, F. C. (2006). Building Core competences through operational Excellence. International Journal of Production Economics special issue on ‘‘Building Core-competence through Operational Excellence’’ Johnson, G., (1992). Managing strategic change: strategy, culture and action. Long Range Planning 25 1, pp. 28–36. Johnson, G. and Scholes, K., (1997). Exploring Corporate Strategy, Prentice-Hall, Europe Johnson, G. et. al., (2006). Exploring Corporate Strategy, Prentice-Hall, Europe Lin, S., & Lee, K. (2006) A fuzzy quantified SWOT procedure for environmental evaluation of an international distribution center. Information Sciences Volume 178, Issue 2, (2008) Pp. 541-549. Wonglimpiyarat, J. (2004). Amex’s strategies for launching the smart card innovation. Technovation 24 (2004) 773–777 Read More