Project vs Operations
Projects vs OPerations
• People get confused between projects and
operations because they share some
characteristics, such as:
– Both are performed by people.
– Both are planned, executed and controlled.
– Both have resource limitations.
• These common characteristics make people
confused. However, the differences between
projects and operations can be clear.
Organizations
• An organization which deals with projects is
known as a projectized organization
• An organization which deals with operational
work is known as a functional organization.
• A matrix organization deals with projects as
well as operations.
What is a Project?
• “A project is a temporary organization that is
created for the purpose of delivering one or
more business products according to an
agreed Business Case.”
• “A project is a temporary endeavor
undertaken to create a unique product,
service, or result.” by PMBOK Guide
Project definition continue
Although the wording of each definitions is different,
the meaning is the same. You can conclude that:
– The nature of a project is temporary.
– A project is undertaken to produce a unique output.
Output can be a product, service, or result.
What does it mean that a project is temporary by
nature?
– Once you deliver the final deliverable, your project will
cease to exist because its objective has been achieved. A
project has a definitive start and end: it cannot continue
forever. It has to end when the objective is achieved or it
is terminated.
What is Operations
• Operations are the ongoing execution of activities and they
follow an organization’s procedures to produce the same result
or a repetitive service. Operations are permanent in nature.
Production, manufacturing, and accounting are examples of
operations.
• There are many definitions of operations. Some are as follows:
– Operations do not produce new things, but they are necessary to
maintain and sustain the system.
– Operations are used to run regular business models, achieve the goals
of the business, and support the business.
– Operations are different from projects, which are known for their
uniqueness.
– Operations are permanent, and their only constraint is to make a profit
for the organization.
• Any manufacturing or production process can be an example of
The Difference Between Projects and Operations
• Projects are unique and temporary, while operations are ongoing and
permanent with a repetitive output.
• Projects have a fixed budget, while operations have to earn a profit to run
the business.
• Projects are executed to start a new business objective and terminated when
it is achieved, while operational work does not produce anything new and is
ongoing.
• Projects create a unique product, service, or result, while operations produce
the same product, aim to earn a profit and keep the system running.
• There are more risks in projects as they are usually done for the first time,
while in operations there are fewer risks as they are repeated many times.
• Projects are performance intensive while operations are efficiency intensive.
• Projects are managed through project management and operations require
business process management.
Why Projects and Operations are Undertaken
• Projects are undertaken due to the following
reasons:
– An opportunity or business need
– Social need
– Technological advancement
– Customer request
– Market demand
– Legal requirement
• On the other hand, operations are performed
to run the business and sustain the system.
A Real-World Example of Projects and Operations
Assume you were given a project to build a car
manufacturing facility.
You build the facility and deliver it to the client. Your job is
completed, and the client has started manufacturing cars.
In this example, building the facility is an example of a
project, because here you constructed a car manufacturing
facility and handed it over to the client and signed off.
However, once the facility starts working and the car
manufacturing process begins, this is an example of
operations, because here the facility is producing a
repetitive output, cars.
Therefore, this is an example of an operation.
Summary
Projects are temporary in nature and they
produce something new, while operations
don’t produce anything new; they maintain
and sustain a system. Both are an important
part of a product life cycle and interact with
each other on many occasions. In a project,
your aim is to achieve the objective, while
operations are metrics-focused.