Reasons Why Organizations Are Using Project Management - Essay Example

Topic: Lecturer: Presentation: Introduction Project management is a multifaceted activity in an organization that is significant in the accomplishment of an organization’s mission. For many years since the inception of project management in organizations, project managers have mainly been focused on ensuring that the job they have at hand is accomplished efficiently. However, contemporary project management has become more result oriented rather than the conventional way of focusing on project time frame, financial plan as well as terms and conditions. Contemporary project management is concerned with the outcome for which the project was set. This paper will evaluate the various reasons why organizations are using Project Management to achieve their strategic objectives. It will focus on the view of projects as investments rather than being likened to investments. The paper will evaluate the application of the various doctrines of strategic project management that project managers use to accomplish the strategic objectives. Project Management and Decision Making Project management generally takes the form of a decision tree (Fig. 1). Goodwin and Wright, (2009) observe that after developing the strategic objectives, the managers evaluate the current situation or status of the organization. This is a starting point that is necessary to determine the next course of action. Project management is therefore preferred because it answers the question of whether the organization has attained its maximum capacity (Chapman and Ward, 2003). If not, the managers engage in assessing the constraints to establish if their cause is known or not. From this point, if the causes of the constraints are known, ways of alleviating them can be determined. If they are not known, investigations are undertaken. Such procedures help organizations to apply a straightforward approach to solving problems (Kendrick, 2009). Yes No No Yes Figure 1: Decision tree and project management Many contemporary organizations undertake different projects depending on their significance to organizational productivity (Dale et al. 2007). In many situations, different departments in the organization come up with projects that compete for the available finances. They have different impacts on the overall organizational performance and priorities need to be set depending on the organizational needs. Project management is significant in making strategic choices to support the projects that need immediate attention as well as those that can be implemented in future (Kemp, 2006). Strategic project management integrates major organizational processes of strategic planning, tactical setting of organizational goals as well as the management of the business projects. It helps in the effective allocation of the scarce resources (Boddy & Buchanan, 1999). Projects as Investments According to Fretty (2006), project management generates the view of a project as an investment. This is significant for the accomplishment of the project’s goal due to the fact that money is sacrificed to finance the organization’s business strategy, generally indicating that projects are investments that enhance the realization of strategic objectives (Roberts, 2009). Investments were viewed by Barker and Cole (2009) to be binding due to the fact that the initial outlay has to be recovered through accrued benefits. When projects are considered as investments, they bind the implementers to ensure that every action brings positive results to ensure that the eventual outcome is not affected (Nokes and Kelly, 2007). In other words, organizations use project management to increase accountability among the project implementation team. Managing investments is focused on strategic objectives of organizations such as market share reduced cost of production, shareholder value as well as customer satisfaction among others. The time it takes or the resources required for such objectives to be accomplished are not as important as the outcome of the project (Stutely, 2006). The eventual outcome of the project is expected to improve organizational productivity. The more customers are satisfied the higher the productivity. Accomplishment of the strategic objectives reflects the entirety of project development and financing (Harold, 2009). Project management helps to accomplish the desired improvements in an organization. It is significant in the avoidance of failure through perceiving the business needs in a strategic approach (Meredith and Mantel, 2009). Results Oriented Management Project management in contemporary organizations helps in the avoidance of a situation whereby projects are implemented according to the laid out plan, within a particular time frame and also according to the budget, which are the only aspects that are considered to determine the successful completion of a project. Under such circumstances, the strategic objectives of the project may not be accomplished (Reiss, 2007). For this reason, managers ensure that project management is focused on the results of the project rather than the process of implementing it. For example, there are usually specific and measurable strategic objective that the project is intended to accomplish, such as increased productivity through expanding the production system over a period of one year. The increased productivity is clearly defined in terms of additional tons of products (Jeffrey, 2007). The conventional implementation of projects only focused on the question of whether the expansion will be accomplished over a defined period and whether the resources will be enough, but not the outcome of engaging in the project (Billingham, 2008). In other words project management is flexible in the sense that if it is understood that there will be no increased productivity, there would be no need to engage in the project (Fretty, 2006). On the other hand, a project may not be successful in terms of meeting the deadline or using the available resources, but it may be successful in terms of accomplishment of the strategic objectives (Lock, 2007). The managers may vary the various aspects such as time frame as well as resources so long as the strategic objectives are met. Generally, project management links the project with the business strategy that led to the implementation of the project (Harold & Frank, 2009). Project Management as a Tool The application of project management as a tool helps in classifying the position of the organization at a particular time as well as where it needs to be. In other words, the strategic objectives are aligned according to the organizational needs (Kezner, 2009). It also allows the evaluation of the project teams as regards accomplishing change. It also allows selection of the best project that can add value to the organization (Burke, 2003). Through project management, projects are implemented perfectly and can be continuously monitored and investments managed effectively (Fretty, 2006). Strategy, according to Cleland, (1995) comprises the combined and feasible activities that are significant for the accomplishment of organizational goals as well as execution of working programs. Project management is used as a tool for increasing proficiency as regards coping with growing complexity in the operating environment. There are many challenges that are faced in the accomplishment of strategic objectives within organizations such as inflation, and government policies (Cousins et al. 2007). There are increasing uncertainties caused by competition and other unpredictable events among other inefficiencies. These are dealt with through project management whereby reliability is maintained in the process of accomplishing the strategic objectives under a limited period of time, financial plan as well as meeting the needs of stakeholders by providing and managing the available resources (Clifford & Erik, 2008). It involves improved collaboration, administration, implementation authority, receptiveness and configuration of managerial elements and procedures with outcomes and the cause of action. The project leaders are able to generate dexterity and innovativeness, development and reactions to variations in the external environment (Slack et al. 2008). Competitive Advantage In the accomplishment of strategic objectives, project management puts the organization I a competitive advantage through optimal use of resources as well as making informed decisions (Hoyle, 2006). A competitive advantage is accomplished through a labor force that is strengthened by a culture of implementation and collaboration. All efforts are geared towards an end result that increases customer satisfaction (Cleland, 1995). A competitive position is maintained in the organization by maintaining reliable information that is acquired in a timely manner through project management, which is significant for the senior managers to deal with emerging problems before the project plan is adversely affected. The project implementation team is able to accomplish the tasks with a clear vision regarding the expected outcome and hence understand their roles as well as how their actions are connected to the broader picture of the project (Begg and Ward, 2006). Duplication of roles in the project is therefore avoided especially due to the presence of effective communication, which on the other hand increases enthusiasm in the workforce and hence improved output (Bhatt, 2002). Organizational Case Studies Starbucks is one of the organizations that apply project management to accomplish strategic goals that are developed through strategic planning. Several projects are undertaken by the organization, which makes project management necessary. The strategic objectives are based on the organization’s needs, mainly focused on accomplishment of competitiveness through customer satisfaction. For example, project management allows the organization to undertake coffee production and many projects in corporate social responsibility (Michelli, 2006). Deloitte is also an organization that has been successful in accomplishing strategic objectives through project management. It has helped the organization to accomplish the desired results by clearly defining the appropriate way to execute strategy and change. Accountability and responsibility are accomplished since each project is assigned to a project manager. Project management has also helped the organization to avoid developing strategies that are never accomplished or even attempted. There are project managers who oversee projects in various countries globally. The organization has been able to accomplish its strategic objectives through alliances with organizations such as HP and Oracle through a strong project management team. All projects are undertaken according to Project Management Body of Knowledge (PMBOK), focused on client satisfaction (Deloitte, 2010). The organizations that apply project management are able to develop a strategic response, which is usually a continuous process that involves a decision making and analyzing the strengths and weaknesses, opportunities and threats in the operating environment. Such organizations are able to capitalize on their strengths and also take opportunity of their competitor’s weaknesses (Bateman & Snell, 2007). Conclusion In applying project management, the project is considered as an investment. Time frame, budget and procedures of accomplishing projects are not as important in project management as the outcome of the project as regards the accomplishment of strategic objectives. Project management acts as a link between the project and the objectives for which the project was chartered. It is significant in making the desired improvements in the organization. It is important in improving proficiency in accomplishing the organization’s strategic objectives. Managers are able to adjust the project implementation plan to match with the changes occurring in the operating environment. Duplication of roles is avoided as the project management teams share roles. Organizations such as Starbucks and Deloitte are among the organizations that have been successful in accomplishing the strategic objectives through project management. They are able to develop strategic responses to cope with a dynamic operating environment. References Barker, S. and Cole, R. 2009. Brilliant Project Management (Revised Edition): what the best project managers know, do and say, Prentice Hall Bateman, T. S. & Snell, S. 2007. Management: Leading and Collaborating in a Competitive World, McGraw - Hill. Begg, D. and Ward, D. 2006. Economics for Business, McGraw-Hill Higher Education Bhatt, G. D. 2002. “Management strategies for individual knowledge and organizational knowledge”, Journal of Knowledge Management, Vol. 6 No.1, pp.31-9. Billingham, V. 2008. 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