The development of
project management capabilities in organisations, simultaneously with the
application of information management systems, allow enterprise teams to work
in partnership in defining plans and managing take-to-market projects by
synchronising team-oriented tasks, schedules, and resource allocations. This
allows cross-functional teams to create and share project information. However,
this is not sufficient, information management systems have the potential to
allow project management practices to take place in a real-time environment. As
a consequence of this potential project management proficiency, locally,
nationally or globally dispersed users are able to concurrently view and
interact with the same updated project information immediately, including
project schedules, threaded discussions, and other relevant documentation. In
this scenario the term dispersed user takes on a wider meaning. It not only
includes the cross-functional management teams but also experts drawn from the
organisation’s supply chain, and business partners.
On a macro level
organisations are motivated to implement project management techniques to
ensure that their undertakings (small or major) are delivered on time, within the
cost budget and to the stipulated quality. On a micro level, project management
combined with an appropriate information management system has the objectives
of: (a) reducing project overhead costs; (b) customising the project workplace
to fit the operational style of the project teams and respective team members;
(c) proactively informing the executive management strata of the strategic
projects on a real-time basis; (d) ensuring that project team members share
accurate, meaningful and timely project documents; and (e) ensuring that
critical task deadlines are met. Whilst the motivation and objectives to apply
project management in organisations is commendable, they do not assure project
success.
However, before
discussing the meaning and achievement of project success it is appropriate at
this stage to provide a brief history of project management.
HISTORY
OF PROJECT MANAGEMENT
Project management
has been practiced for thousands of years dating back to the Egyptian epoch,
but it was in the mid-1950s that organisations commenced applying formal
project management tools and techniques to complex projects. Modern project
management methods had their origins in two parallel but different problems of
planning and control in projects in the United States. The first case involved
the U.S Navy, which at that time was concerned with the control of contracts
for its Polaris Missile project. These contracts consisted of research,
development work and manufacturing of parts that were unique and had never been
previously undertaken.
This particular
project was characterised by high uncertainty, since neither cost nor time
could be accurately estimated. Hence, completion times were based on
probabilities. Time estimates were based on optimistic, pessimistic and most
likely. These three time scenarios were mathematically assessed to determine
the probable completion date. This procedure was called program evaluation
review technique (PERT). Initially, the PERT technique did not take into
consideration cost. However, the cost feature was later included using the same
estimating approach as with time. Due to the three estimation scenarios, PERT
was found (and still is) to be best suited for projects with a high degree of
uncertainty reflecting their level of uniqueness. The second case, involved the
private sector, namely, E.I du Pont de Nemours Company, which had undertaken to
construct major chemical plants in U.S. Unlike the Navy Polaris project, these
construction undertakings required accurate time and cost estimates. The
methodology developed by this company was originally referred to as project
planning and scheduling (PPS). PPS required realistic estimates of cost and
time, and is thus a more definitive approach than PERT. The PPS technique was
later developed into the critical path method (CPM) that became very popular
with the construction industry.
During the 1960s and
1970s, both PERT and CPM increased their popularity within
the private and public sectors. Defence Departments of various countries, NASA,
and large engineering and construction companies world wide applied project
management principles and tools to manage large budget, schedule-driven
projects. The popularity in the use of these project management tools during
this period coincided with the development of computers and the associated
packages that specialised in project management. However, initially these
computer packages were very costly and were executed only on mainframe or mini
computers. The use of project management techniques in the 1980s was facilitated
with the advent of the personal computer and associated low cost project
management software. Hence, during this period, the manufacturing and software
development sectors commenced to adopt and implement sophisticated project
management practices as well. By the 1990s, project management theories, tools
and techniques were widely received by different industries and organisations.
IMPORTANCE OF PROJECT MANAGEMENT
The importance of Project Management is an important topic
because all organisations, be they small or large, at one time or other, are
involved in implementing new undertakings. These undertakings may be diverse,
such as, the development of a new product or service; the establishment of a
new production line in a manufacturing enterprise; a public relations promotion
campaign; or a major building programme. Whilst the 1980s were about quality
and the 1990s were all about globalisation, the 2000s are about velocity. That
is, to keep ahead of their competitors, organisations are continually faced
with the development of complex products, services and processes with very
short time-to-market windows combined with the need for cross-functional
expertise. In this scenario, project management becomes a very important and
powerful tool in the hands of organisations that understand its use and have
the competencies to apply it.
There is no doubt
that organisations today face more aggressive competition than in the past and
the business environment they operate in is a highly turbulent one. This
scenario has increased the need for organisational accountability for the
private and public sectors, leading to a greater focus and demand for
operational effectiveness and efficiency.
Effectiveness and
efficiency may be facilitated through the introduction of best practices that
are able to optimise the management of organisational resources. It has been
shown that operations and projects are dissimilar with each requiring different
management techniques. Hence, in a project environment, project management can:
(a) support the achievement of project and organisational goals; and (b)
provide a greater assurance to stakeholders that resources are being managed
effectively.
Research by Roberts
and Furlonger in a study of information systems projects show that using a
reasonably detailed project management methodology, as compared to a loose
methodology, improves productivity by 20 to 30 percent. Furthermore, the use of
a formalised project management structure to projects can facilitate: (a) the clarification
of project scope; (b) agreement of objectives and goals; (c) identifying
resources needed; (d) ensuring accountability for results and performance; (e)
and encouraging the project team to focus on the final benefits to be achieved.
Moreover, the research indicates that 85-90% of projects fail to deliver on
time, on budget and to the quality of performance expected. The major causes
identified for this situation include:
- Lack of a valid business case
justifying the project; - Objectives not properly
defined and agreed; - Lack of communication and
stakeholder management; - Outcomes and/or benefits not
properly defined in measurable terms; - Lack of quality control;
- Poor estimation of duration
and cost; - Inadequate definition and
acceptance of roles (governance); - Insufficient planning and
coordination of resources.
It should be
emphasised that the causes for the failure to deliver on time, on budget and to
the quality of performance expected could be addressed by the application of
project management practices. Furthermore, the failure to deliver on time, on
budget and to the quality of performance expected does not necessarily mean
that the project was itself a failure. At this stage what is being discussed is
the effectiveness and efficiency of project execution and not whether a project
is a success or failure.
Conclusion
Project
management should be viewed as a tool that helps organisations to execute
designated projects effectively and efficiently. The use of this tool does not
automatically guarantee project success. (project success will be discussed in
a subsequent issue). However, in preparation for the next issue, I would like
you to think about the distinction between project success and project
management success. This distinction will provide further insight to the
questions: Why are some projects perceived as failures when they have met all
the traditional standards of success, namely, completed on time, completed
within budget, and meeting all the technical specifications? Why are some
projects perceived to be successful when they have failed to meet two important
criteria that are traditionally associated with success, namely, not completed
on time and not completed within budget?
