The Organizational Context: Strategy, Structure, and Culture
1. Understand how effective project management contributes to achieving strategic objectives.
2. Recognize three components of the corporate strategy model: formulation, implementation, and
evaluation.
3. See the importance of identifying critical project stakeholders and managing them within the context
of project development.
4. Recognize the strengths and weaknesses of three basic forms of organizational structure and their
implications for managing projects.
5. Identify the characteristics of three forms of project management office (PMO).
6. Recognize the positive effects of a supportive organizational culture on project management
practices versus those of a culture that works against project
The Components Of A Project Cycle That
Will Change Over The Duration Of The
Project
The Components are:
Client interest
Project stake
Resources
Creativity
Uncertainty
Client Interest
The level of enthusiasm or concern expressed by the project’s intended
customer. clients can be either internal to the organization or external .
Client interest, is like a ‘U’ shaped curve, reflecting initial enthusiasm,
lower levels of interest during development phases, and renewed interest
as the project nears completion.
Project stake
The amount of corporate investment in the project. The longer the life of the
project, the greater the investment.
Project stake increases dramatically as the project moves forward because an
increasing commitment of resources is needed to support ongoing activities.
Resources
The commitment of financial, human, and technical resources over the life of the
project.
Creativity
The degree of innovation required by the project, especially during certain
development phases.
Creativity, often viewed as innovative thought or applying a unique perspective,
is high at the beginning of a project, as the team and the project’s client begin
developing a shared vision of the project.
Uncertainty
The degree of risk associated with the project. Riskiness here reflects the
number of unknowns, including technical challenges that the project is likely
to face. Uncertainty is highest at the beginning because many challenges
have yet to be identified, let alone addressed.
Determinants of Project success
Time
Budget
Performance
Time, Budget and Performance were considered sufficient at one time
and were called “triple constraint”
Client acceptance.
Time
Projects are constrained by a specified time frame during which they must be
completed. They are not supposed to continue indefinitely. Thus the first
constraint that governs project management involves the basic requirement:
the project should come in on or before its established schedule.
Budget
Projects must meet budgeted allowances in order to use resources as efficiently
as possible. Companies do not write blank checks and hope for the best. Thus the
question to be asked: Was the project completed within budget guidelines?
Client acceptance
The principle of client acceptance argues that projects are developed with
customers, or clients, in mind, and their purpose is to satisfy and exceed
customers’ needs. If client acceptance is a key variable, then we must also ask
whether the completed project is acceptable to the customer for whom it was
intended. Companies that evaluate project success strictly according to the
original “triple constraint” may fail to apply the most important test of all: the
client’s satisfaction with the completed project.
Project Stakeholder
A Project Stakeholder is defined as all individuals or groups who have an
active stake in the project and can potentially impact, either positively or
negatively, its development.
They may either be Internal or External.
Internal stakeholder include:
Top management
Accounting
Other functional managers
Project team members
External stakeholders include
Clients
Competitors
Suppliers
Environmental, political, consumer, and other intervenor
Groups. (intervenor Groups)
Strategic Management
Strategic Management is the science of formulating, implementing, and
evaluating cross-functional decisions that enable an organization to achieve its
objectives
Elements of Strategic Management
The four elements of Strategic Management are:
Developing vision statements and mission statements
Formulating, implementing, and evaluating
Making cross-functional decisions
Achieving objectives
Developing vision statements and mission statements.
Vision and mission statements establish a sense of what the organization hopes to
accomplish or what top managers hope it will become at some point in the future.
Mission statements explain the company’s reason for existence and support the
vision. Many firms apply their vision and mission statements to evaluating new
project opportunities as a first screening device.
Vision Statement
Vision statements describe the organization in terms of where it would like to be
in the future. Effective vision statements are both inspirational and aspirational. A
corporate vision serves as a focal point for members of the organization who may
find themselves pulled in different directions by competing demands.
Mission Statements
Mission statements explain the company’s reason for existence and
support the vision.
Formulating, Implementing, and Evaluating
Projects, as the key ingredients in strategy implementation, play a crucial role
in the basic process model of strategic management. A firm devotes
significant time and resources to evaluating its business opportunities
through developing a corporate vision or mission, assessing internal strengths
and weaknesses as well as external opportunities and threats, establishing
long-range objectives, and generating and selecting among various strategic
alternatives.
All these components relate to the formulation stage of strategy. Within this
context, projects serve as the vehicles that enable companies to seize
opportunities, capitalize on their strengths, and implement overall corporate
objectives. New product development, for example, fits neatly into this
framework. New products are developed and commercially introduced as a
company’s response to business opportunities. Effective project management
enables firms to efficiently and rapidly respond.
Making Cross Functional Decisions
Business strategy is a corporate-wide venture, requiring the commitment and
shared resources of all functional areas to meet overall objectives. Cross-
functional decision making is a critical feature of project management, as experts
from various functional groups come together into a team of diverse personalities
and backgrounds. Project management work is a natural environment in which to
operationalize strategic plans.
What is a Cross Functional Team
A cross-functional team is a workgroup made up of employees from different
functional areas within an organization who collaborate to reach a stated
objective
Achieving objectives.
Whether the organization is seeking market leadership through low-cost,
innovative products, superior quality, or other means, projects are the most
effective tools to allow objectives to be met. A key feature of project
management is that it can potentially allow firms to be effective in the external
market as well as internally efficient in operations; that is, it is a great vehicle for
optimizing organizational objectives, whether they incline toward efficiency of
production or product or process effectiveness.