Difference between Project Management and Operations Management - Assignment Example

Project Management Table of Contents Question Difference between Project management and Operations Management 3 Question 2: Project Selection Techniques 4 Benefits Measurement Method 4 Constrained Optimisation Method 6 Question 3: Skills and competencies of a Project Manager 6 Project initiation 6 Project Closure 7 Question 4: Techniques for Project Planning and Role of Such techniques in Project Implementation 8 Project Scope Planning 8 WBS or Work Breakdown Structure 8 Traceability matrix 9 Project Schedule Planning 10 Gantt chart 11 Network Diagram 11 Project Resource planning 12 Responsibility matrix 12 Project budget 13 Question 5: Project Stakeholder Success Evaluation and Conflict between them 14 Question 6: Computer Packages and its suitability for project management 16 Reference list 17 Question 1: Difference between Project management and Operations Management Project management is the application of skills, knowledge, techniques and efforts in the development of projects in an efficient manner. Here, project can be referred to as a temporary task of a group, where the group is designed to attain specific objectives. Owing to its temporary nature, project management defines beginning and end of the designated task as well as resources and scope available. Operations management, on the other hand, looks into designing and monitoring production processes of the regular business activity on a daily basis and making changes in such business operations for enhancement of productivity and product quality. The key difference between project management and operations management has been highlighted below. Budget The project manager has more roles to play in project budgets wherein he has to look into timely accomplishment of goals to save cost overruns and also encompass the revenues that are due to be earned on completion of the project. The operations manager, on the other hand, is concerned only with the department level budget, which covers aspects like, salaries, cost of office running and benefits to employees as well as services to be purchased. He also needs to make sure that department level budgets are run smoothly (Merchant and Stede, 2012). Schedule The role of operations manager requires adhering to the timeline of tasks that keep the business on its regular schedule. Whereas, the project manager has to make sure that his project runs on time and is completed successfully within schedule so as to avoid cost overruns. For this purpose, it is important that delivery dates and timing of milestones are decided. Progress made with reference to different tasks has to be monitored on a regular basis. Staff management The operations manager plays a big role in recruitment, training and retention of staff in the operations department. He has to fulfil all HR related roles as a manager to the staff and also oversee their performances in relation to business goals. The project manager is not to be involved with hiring and recruitment or HR roles pertaining to a manager. He is only to be concerned with performance of the employee for the assigned task and must arrange training sessions for successful and timely completion of project tasks. Skill Development This involves training and development as well as mentoring and coaching of the department level staff for performing daily operational work of the business effectively. Operations management has annual goals for skill development of employees. Project management includes project specific training, where goal attainment is critical for the training purposes and such training shall extend up to successful completion of the project. The key benefits associated with project management include higher efficiency in delivery of services and tasks, improved levels of customer satisfaction and delivery of services, higher flexibility in tasks, facilitating proper and efficient risk management activities and higher quantity and better quality of results desired (Hilson, 2009). Question 2: Project Selection Techniques The biggest decisions made by an organization are generally related to the project that is to be undertaken. Once the business receives a proposal for a project, it has to consider numerous factors before making the final decision. For this, the company makes choice of the most viable option after consideration of different organisational requirements, aims of the project and goals of the company. Hence, choice of project is critical and so is the method in which the project shall be approached. Benefits Measurement Method In an attempt to assess the project viability and feasibility, there are various methods available like, Cost benefits Analysis, Scoring models, Economic models, DCF or Discounted cash flow, IRR or internal rate of return and Net Present Value. All of them come under the primary method of benefits measurement. Another method that shall be discussed in a detailed manner in this paper is the Constrained Optimisations method, which is a mathematical approach towards estimation of project suitability and project viability (Hay, 2002). While selecting a particular project, project managers generally face a dilemma concerning two separate project, which might have similar goals and similar objectives, but differ in terms of delivery time or costs or any other parameter that need help of such tools for choosing the best possible project. Figure 1: Project Selection Methods (Source: TutorialsPoint, n.d.) The benefits measurement method makes use of all benefits associated with the proposed project and compares them against the other benefits derived from separate projects and also project benchmarks set by the project manager. This comparative approach helps in ensuring that all integrated programs of change and associated projects get implemented and are managed with a continued focus on realisation of the stated benefits. The process involves collection of data; a proper consolidation; analysis of such data for the measurement of results; and whether or not they serve stakeholder’s interests. This is important in order to determine whether the desired as well as unexpected benefits are realised or not. The review of benefits assist in assessment of the actual amount of benefits being realised and preparation of future estimation of benefits to be realised. This also facilitates recommendation of any necessary remedial action to attain desired goals and to address any shortfalls from the expected level of realisation of benefits. One of the advantages associated with benefits measurement method is that it allows for proper presentation of all allowable benefits. The mathematical formulas used therein are easy and highly comprehensible by laymen. Presentation in terms of facts and not numerical, provides the results in a manner that can be understandable for even the lower level staff. The disadvantage of this method is that it is more suitable for smaller projects where benefits are limited and can be completely identified. Also, lack of mathematical approach yields less reliable data which might allow for huge variations. Constrained Optimisation Method The constrained optimisation method involves several complex mathematical calculations for judging the best case and the worst case scenarios as well as probability of occurrence of the desired outcome based on such assumptions and mathematical calculations for assisting in selection of the best possible result. The more common methods of constrained optimisation method include multi objective programming and linear or non-linear programming. The advantages associated with constrained optimisation method are that the mathematical approach helps in getting definitive solutions and probabilistic results help in arriving at more accurate answers. Presentation of results in terms of figures helps in better comparison between various projects, besides assisting in management decision making. The disadvantage of this method is that it undertakes a huge number of mathematical calculations before arriving at results. Furthermore, its suitability is better in case of larger projects. The mathematical approach needs huge accuracy in calculation and wide knowledge of mathematical tools and formulas, which might not be easily understood by all. Question 3: Skills and competencies of a Project Manager Project initiation Project initiation comes after the difficult task of selection of project and analysis of the desired outcomes. After proper selection of the project, the project manager might be briefed about project requirements and given a team that is felt appropriate by the management. In this scenario, the project manager has a difficult task of firstly, understanding the project and secondly, communicating such understanding to his team and initiating the same. This requires sound communication skills on part of the project manager. The team needs to be motivated and made to realize the perspective or vision desired by the manager. Along with this, the manager must gain support of his team members so as to progress smoothly towards the attainment of project goals while maintaining schedule. This requires leadership and motivation skills that help in building teamwork among the subordinates (Richman, 2011). The project manager also needs to chart out schedules, short-term goals, milestones, project tasks breakups, a system for monitoring performance and project tracking, besides assigning tasks to team members. This calls for skills like, technical expertise in scheduling, organizational skill for assignment of tasks, management skills for performance measurement and analytical ability for task scheduling and breakups. Project Closure At the project closure level, there are a number of ambiguities and questions that run in the mind of project team. The project team shifts their focus on to the upcoming task while the project is being completed; therefore, the project manager has to firstly make sure that adequate emphasis is laid upon completion of the present task until its closure. This needs personnel management and leadership skills for proper management of staff, thereby maintaining their focus towards the present work (Treasury Board of Canada Secretariat, n.d.). Secondly, the project facing closure needs to be reviewed for timely and successful attainment of project goals. For this, the project manager must have management skills for proper monitoring of project schedule and overseeing attainment levels of project benefits and objectives. He also requires providing clarity to ill defined project goals with proper measurement and communicating the same to the team for achievement of satisfactory outcomes. Clients and other staff of the project shall be concerned with loss of competence when the project manager is about to leave the specific project. For the management of this ambiguity, the project manager must properly convey the technical and operational expertise to the team handling the project after its completion, thereby exhibiting skills of efficient leadership and management. Project planning is the most critical phase of project management. The management and control of different activities of a project cannot go forth without presence of an appropriate plan. Question 4: Techniques for Project Planning and Role of Such techniques in Project Implementation The project planning phase can be broken down into scope planning, schedule planning and resources planning. The process of plan development can be called an optimization process, where each project has a specific amount of risk associated with it. The planning process looks into minimising such risks on items that have lower priority associated with the project. Project Scope Planning Project scope refers to all those activities that need to be performed within a specific project. For this, one has to define the key deliverables and the ways to attain them. There are many customised tools available for this phase of planning and the more popular among these are the Work breakdown Structure and Traceability Matrix. WBS or Work Breakdown Structure The work breakdown structure is a hierarchical decomposition of requirements of a project. Here, each requirement of the project is broken down into small and manageable deliverables. These activity breakdowns then serve as building blocks for planning out the complete project. The layers of the work breakdown structure flow from major activities at higher levels to smaller activities at the lowest level. Significant layering down to the lowest possible activity allows for proper definition of task roles for the project management team. Smaller breakdowns associated higher risks with each unbroken activity. This might also lead to huge risks, which may hamper functioning of the project. On the contrary, excessive decomposition leads to development of unnecessary task definitions and high bureaucracy in task attainment, which might cause project delays (Hobbs, 2009). Figure 2: Work Breakdown Structure (Source: ProjectManagementGuru, n.d.) The project deliverables can be decomposed in a variety of ways. They can be based on processes of the business or phases of the project. The WBS structure has to be organised in such a manner that the lower performance activities can be rolled up for attainment of the higher objective. In a complex project, accomplishment of sub-projects becomes stepping stones for completion of the larger task in the WBS. During the implementation phase, attainment of each activity helps in management of project schedules and tracking of milestone attainments. Each activity shall help in defining project schedules and goals for the time period. It also gives a complete picture of different tasks that need to be completed simultaneously or chronologically for progressive movement towards larger goal higher up in the WBS chart. The advantage associated here is that it allows for clarity in representation of task flows and presents ready detail for task breakdowns that contribute towards attainment of the final goal. The disadvantage of WBS is that there is no clarity present regarding the degree to which tasks need to be broken. The task breakdown is dependent on efficiency and judgement of the project manager and the risk of oversimplification or complicated task definitions runs high. Traceability matrix One of the most common techniques, the traceability matrix, is a table that defines the requirement under each cell, where these requirements are associated with those of the sub-projects. This in turn helps in determination of the project life cycle. This planning tool helps in reflecting intention of the project management group towards meeting requirements and also proves to be a tracking tool where achievement of a requirement is a set milestone (Pinto, 2007). The requirements that get generally met within the traceability matrix include; 1. product requirements 2. business objectives and goals 3. Requirements of business process 4. Requirements for Logistics support 5. Requirements of regulatory bodies and agencies 6. Safety and project security requirements During the implementation phase, requirements filled up within each cell of the traceability matrix allow to keep a constant check on progress of the project. The results of any analysis or project test can enable a partial fulfilment or complete fulfilment of a requirement or a sub-requirement. Once the requirement is addressed, the milestone gets achieved and this attainment facilitates progress tracking of project during the implementation phase. This also supports defining a methodology of allocations for project implementation documentation. Also, control mechanism could allow for scope of controlling project deviations. The benefit associated with traceability matrix is that it allows for clarity in all the different requirements pertaining to a business. The drawback of the traceability matrix is that it lacks representation formats and has to be recorded as per discretion of the project manager. Project Schedule Planning Schedule planning refers to the sequencing of different tasks as per requirement of project. Here, time offers the constrain factor to project schedule planning. Among a host of different techniques used in schedule planning, the Gantt chart and the network diagram are the most popular ones. The analysis of schedule involves popular methods like, critical path method, PERT analysis, Critical Chain and Resource levelling analysis. Gantt chart The Gantt chart is a format for scheduling, where each task is represented in the form of a bar chart. Length of the bar offers to explain the amount of time to be taken by the task in its completion. Each bar is followed by another bar, representing the following task. Such a task might have different beginning and ending period depending on the time of initiation. It might not always happen that the completion of one task is followed by the beginning of another. Figure 3: Gantt chart (Source: ProjectManagementGuru, n.d.) The Gantt chart offers to be a great tracking tool during implementation phase of the project. It can be used to track daily progresses and also milestone attainment. The Gantt chart has advantages associated with ease of use, understanding and clarity in representation. The disadvantages of the Gantt chart are representation of inaccurate task durations that might get finalised at later stages as well as overlooking of resources constraints. Network Diagram The network diagram represents a flowchart of different tasks associated with a project. This network is also a determination of the predecessor and successor of each task and is connected by using nodes and arrows. Complex project that involve a whole host of tasks can use this for internal guidance and information sharing. The key advantage of the network diagram is that it forms the base for more complex schedule plans. On the disadvantage front, the network diagram brings the focus on the beginning and end of the project and tasks associated with it, as opposed to arbitrary tasks that have no predefined beginning and end date (Richman, 2011). Figure 4: Network Diagram (Source: ProjectManagementGuru, n.d.) The network diagram allows for guidance to the project task alignments during the implementation phase. It helps to get quick views of interconnected task through its easy and smooth flow representations. It is simple to understand and hence, can act as a superior information sharing tool for lower level staff. Project Resource planning Project resource plan are descriptions of the process whereby resources of the business shall be utilised and applied within each activity of the project. Identification of the key resources, which includes human resources, financial resources, raw materials and machinery, is facilitated through the use of resource planning tools under project management. Such tools also support proper and appropriate deployment of resources to each activity. The key resource planning tools are Responsibility Matrix and Staff Management planning for human resource planning, while Project Budget and Spend Plan are used for financial planning. Responsibility matrix The responsibility matrix is a tabular representation of the roles and expected involvement levels for each of the project team members under resource planning. Each team member is allowed to look at the responsibility matrix and immediately understand his role and tasks associated. He can also get a clear view of his team member who shall be working with him in various tasks. As a result, he can organize and communicate well before the task begins. In this way, proper organization of tasks is facilitated and considerable amount of thought is generated through communication between employees, even before the activity begins (Meredith and Mantel, 2008). Figure 5: Responsibility Matrix (Source: ProjectManagementGuru, n.d.) The responsibility offers to be a risk identification tool during implementation phase of the project plan. Through role assignments, the matrix allows the project manager to assess and estimate the capacity of each individual to attain specific tasks that have been assigned. There could be a risk that one individual might have too many tasks to handle, which can lead to defrayments from schedule. It also helps in comprehending if an individual is incapable of performing future tasks through assessment of his previous task performances. Project budget Projects budgets help in planning for spending pattern of the company’s resources towards completion of the project on a time based format. This spreadsheet has columns representing time in month or week as per requirement and rows representing tasks. Each row column cell has allocations of the budget, which help in representing the total number of resources required by each task and also that required in a particular month or week of the project activity. The cumulative total of all the rows or columns signifies total project cost. Figure 7: Project Budget (Source: ProjectManagementGuru, n.d.) During the implementation phase, the project budget helps in determination of deviation from monthly resource allocations or from task-wise resource allocations. Here, the project budget proves to be a useful tracking and monitoring tool. Question 5: Project Stakeholder Success Evaluation and Conflict between them The stakeholders to a project refer to those who are affected by the outcomes in a considerable manner and hence, have an interest in the same. Here, it is not necessary for each stakeholder to have the same degree of interest. One rather has his own set of expectations, requirements and ways of handling outcomes of the project on its successful completion. The key stakeholders associated with a project are; 1. Project Sponsor: The sponsor shall look into the amount of revenues generated or rise in revenue for a project that was dedicated towards increasing sales revenue through higher marketing initiatives. Here, the project sponsor pays for marketing expenses and is concerned with the repayment of his money along with the interest, which can only come if the project runs smoothly and generates sufficient revenue so that repayment is assured. 2. Project Team: The project team puts in their efforts towards increasing sales revenue through increased marketing. They design advertisement creative, work on promotion techniques, formulate actual promotions and make appropriate promotion plans for successful attainment of the project goals. Success of this project shall be determined through rise in sales at the desired rates (Kerzner, 2014). 3. The higher levels of management: The higher management shall be concerned with the rise in sales and the amount of investments they have sought. The management might also be concerned about conformity with the regulatory norms and proper governmental compliance before the product is heavily advertised. Additionally, the managements shall be more concentrated at cost factors. Advertising expenses add to the cost with little tangible benefits. The management wants to minimise the cost implications that advertising project might have and this conflict arises between interests of the project team and project sponsor and that of the higher management. 4. The end users of the outcome of project: The end users include the marketers, the customers and the sales staff. These set of individuals have similar interests of increase in sales. The other group of end users include management, finance managers and operations managers who want to minimise cost implications of such rise in marketing expenditure and compensate the rise in expenses by a commensurate and higher rise in sales. 5. Internal stakeholders: They include the client, the portfolio manager and departmental heads of the organizations that are affected in any manner. The internal clients are the users of rise in sales information for formulation of future projects and strategies. These also comprise the management who shall use the results of rise in marketing project and its outcomes of rise in sales in order to frame their course of action for other product groups or new products. 6. External stakeholders: These include external clients, contractors, regulatory authorities and the government, suppliers and local community and media. The government, the customers and the regulatory bodies are concerned with the delivery of products or services promised in the advertisement and that there is no defrayment from the promised aspects related to that offered while delivery for which the marketing project has been undertaken. The regulatory bodies also want to look into the compliance of advertisement features with that is acceptable in the society. If advertisement is in non-conformity with societal norms, the advertisement and marketing project might not be effective; hence, there shall surface a conflict of interest between project managers, internal stakeholders and the regulatory bodies. Question 6: Computer Packages and its suitability for project management Innovation and technology have nowadays changed the way of living. They have played a critical role in altering entire life cycle of a project undertaken. The process of planning, scheduling, arranging for resources, resource allocation, execution, monitoring and closure of project have become quite simpler with the emergence of various project management tools and techniques. Such software offers a wide variety of computerised processes, which direct towards development of project planning techniques, project scheduling and project monitoring. This software offers end-to-end project management solution and incorporates all information so as to present them collectively in a readily understandable and recognisable format. They also assist in organizing and presenting data for decision making purposes and for ready reference of the project team (M. Umble and E. Umble, 2000). Reference list Hay, C., 2002. Political analysis: a critical introduction. Basingstoke: Palgrave. Hilson, D., 2009. Managing Risk in Projects. Burlington: Gower Publishing Group. Hobbs, P. 2009. Project Management. Massachusetts: Dorling Kindersley Limited. Kerzner, H. R. 2014. Project Management – Best Practices: Achieving Global Excellence. London: John Wiley and Sons. Merchant, K. A. and Stede, V. D., 2012. Management Control Systems. London: Prentice Hall. Meredith, J. R. and Mantel, S. J. 2008. Project Management: A Managerial Approach. London: John Wiley & Sons. Pinto, J. K. 2007. Project Management, Achieving Competitive Advantage. New Jersey: Prentice Hall. ProjectManagementGuru, n.d., Project Scope Planning Tools & Techniques. [online] Available at: [Accessed 25 June 2014]. Richman, L., 2011. Improving your project management skills. Seattle: AMACOM. Treasury Board of Canada Secretariat, n.d., Project Management Core Competencies. [online] Available at: [Accessed 25 June 2014]. TutorialsPoint, n.d., Project Selection Methods. [online] Available at: [Accessed 25 June 2014]. Umble, M. and Umble, E., 2000. Managing Your Projects for Success: An Application of the Theory of Constraints. 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