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Assigned Readings: Chapter

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Assigned Readings:

Chapter. 3 Organization: Structure and Culture

Chapter. 4 Defining the Project

Initial Postings: Read and reflect on the assigned readings for the week. Then post what you thought was the most important concept(s), method(s), term(s), and/or any other thing that you felt was worthy of your understanding in each assigned textbook chapter.Your initial post should be based upon the assigned reading for the week, so the textbook should be a source listed in your reference section and cited within the body of the text. Other sources are not required but feel free to use them if they aid in your discussion.

Also, provide a graduate-level response to each of the following questions:

1. The culture of the organization can impact the effectiveness of different project management structures. Organizational cultures that do not encourage teamwork, collaboration, and cross-functional integration need a stronger project management structure (i.e., project team, project matrix) to be successful. Conversely, a functional matrix can be effective in an organization in which the culture of the organization is conducive to project management.
2. You work for LL Company, which manufactures high-end optical scopes for hunting rifles. LL Company has been the market leader for the past 20 years and has decided to diversify by applying its technology to develop a top-quality binocular. What kind of project management structure would you recommend they use for this project? What information would you like to have to make this recommendation, and why?

Chapter Four Defining the Project Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–1 Where We Are Now Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–2 Learning Objectives 1. Identify key elements of a project scope statement and understand why a complete scope statement is crucial to project success 2. Understand why it is important to establish project priorities in terms of cost, time, and performance 3. Demonstrate the importance of a work breakdown structure (WBS) to the management of projects and how it serves as a data base for planning and control 4. Demonstrate how the organization breakdown structure (OBS) establishes accountability to organizational units 5. Describe a process breakdown structure (PBS) and when to use it 6. Create responsibility matrices for small projects 7. Create a communication plan for a project Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–3 Chapter Outline 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 Step 1: Defining the Project Scope Step 2: Establishing Project Priorities Step 3: Creating the Work Breakdown Structure Step 4: Integrating the WBS with the Organization Step 5: Coding the WBS for the Information System Process Breakdown Structure Responsibility Matrices Project Communication Plan Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–4 Defining the Project Step 1: Defining the Project Scope Step 2: Establishing Project Priorities Step 3: Creating the Work Breakdown Structure Step 4: Integrating the WBS with the Organization Step 5: Coding the WBS for the Information System Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–5 Step 1: Defining the Project Scope • Project Scope – A definition of the end result or mission of the project—a product or service for the client/customer • Purposes of the Project Scope Statement – To clearly define the deliverable(s) for the end user. – To focus the project on successful completion of its goals. – To be used by the project owner and participants as a planning tool and for measuring project success Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–6 Project Scope Checklist 1. Project objective 2. Deliverables 3. Milestones 4. Technical requirements 5. Limits and exclusions 6. Reviews with customer Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–7 Project Scope: Terms and Definitions • Scope Statements – Also called statements of work (SOW) • Project Charter – Can contain an expanded version of scope statement. – A document authorizing the project manager to initiate and lead the project • Scope Creep – The tendency for the project scope to expand over time due to changing requirements, specifications, and priorities Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–8 Step 2: Establishing Project Priorities • Causes of Project Trade-offs – Shifts in the relative importance of criterions related to cost, time, and performance parameters • Budget–Cost • Schedule–Time • Performance–Scope • Managing the Priorities of Project Trade-offs – Constrain: original parameter is a fixed requirement. – Enhance: optimizing a criterion over others – Accept: reducing (or not meeting) a criterion requirement Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–9 Project Management Trade-offs FIGURE 4.1 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–10 Project Priority Matrix FIGURE 4.2 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–11 Step 3: Creating the Work Breakdown Structure • Work Breakdown Structure (WBS) – A hierarchical outline (map) that identifies the products and work elements involved in a project – Defines the relationship of the final deliverable (the project) to its subdeliverables, and in turn, their relationships to work packages. – Best suited for design and build projects that have tangible outcomes rather than process-oriented projects Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–12 Hierarchical Breakdown of the WBS * This breakdown groups work packages by type of work within a deliverable and allows assignment of responsibility to an organizational unit. This extra step facilitates a system for monitoring project progress (discussed in Chapter 13). FIGURE 4.3 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–13 How WBS Helps the Project Manager • WBS – Facilitates evaluation of cost, time, and technical performance of the organization on a project. – Provides management with information appropriate to each organizational level. – Helps in the development of the organization breakdown structure (OBS), which assigns project responsibilities to organizational units and individuals – Helps manage plan, schedule, and budget. – Defines communication channels and assists in coordinating the various project elements. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–14 Work Breakdown Structure FIGURE 4.4 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–15 Work Packages • A work package is the lowest level of the WBS. – It is output-oriented in that it: 1. Defines work (what). 2. Identifies time to complete a work package (how long). 3. Identifies a time-phased budget to complete a work package (cost). 4. Identifies resources needed to complete a work package (how much). 5. Identifies a person responsible for units of work (who). 6. Identifies monitoring points for measuring success (how well). Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–16 Step 4: Integrating the WBS with the Organization • Organizational Breakdown Structure (OBS) – Depicts how the firm is organized to discharge its work responsibility for a project. • Provides a framework to summarize organization unit work performance. • Identifies organization units responsible for work packages. • Ties organizational units to cost control accounts. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–17 Integration of WBS and OBS FIGURE 4.5 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–18 Step 5: Coding the WBS for the Information System • WBS Coding System – Defines: • Levels and elements of the WBS • Organization elements • Work packages • Budget and cost information – Allows reports to be consolidated at any level in the organization structure • WBS Dictionary – Provides detailed information about each element in the WBS. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–19 Coding the WBS EXHIBIT 4.1 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–20 Process Breakdown Structure (PBS) for Software Development Project FIGURE 4.6 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–21 Responsibility Matrices • Responsibility Matrix (RM) – Also called a linear responsibility chart – Summarizes the tasks to be accomplished and who is responsible for what on the project. • Lists project activities and participants responsible for each activity. • Clarifies critical interfaces between units and individuals that need coordination. • Provide a means for all participants to view their responsibilities and agree on their assignments. • Clarifies the extent or type of authority that can be exercised by each participant. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–22 Responsibility Matrix for a Market Research Project FIGURE 4.7 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–23 Responsibility Matrix for the Conveyor Belt Project FIGURE 4.8 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–24 Project Communication Plan • What information needs to be collected and when? • Who will receive the information? • What methods will be used to gather and store information? • What are the limits, if any, on who has access to certain kinds of information? • When will the information be communicated? • How will it be communicated? Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–25 Developing a Communication Plan 1. Stakeholder analysis 2. Information needs 3. Sources of information 4. Dissemination modes 5. Responsibility and timing Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–26 Stakeholder Communications FIGURE 4.9 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–27 Information Needs • Project status reports • Deliverable issues • Changes in scope • Team status meetings • Gating decisions • Accepted request changes • Action items • Milestone reports Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–28 Shale Oil Research Project Communication Plan FIGURE 4.10 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–29 Key Terms Cost account Milestone Organization breakdown structure (OBS) Priority matrix Process breakdown structure (PBS) Project charter Responsibility matrix Scope creep Scope statement WBS dictionary Work breakdown structure (WBS) Work package Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 4–30 Chapter Three Organization: Structure and Culture Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–1 Where We Are Now Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–2 Learning Objectives 1. Identify different project management structures and understand their strengths and weaknesses 2. Distinguish three different types of matrix structures and understand their strengths and weaknesses 3. Understand organizational and project considerations that should be considered in choosing an appropriate project management structure 4. Appreciate the significant role that organizational culture plays in managing projects 5. Interpret the culture of an organization 6. Understand the interaction between project management structure and the culture of an organization Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–3 Chapter Outline 3.1 3.2 3.3 3.4 Project Management Structures What Is the Right Project Management Structure? Organizational Culture Implications of Organizational Culture for Organizing Projects Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–4 Project Management Structures • Challenges to Organizing Projects – The uniqueness and short duration of projects relative to ongoing longer-term organizational activities – The multidisciplinary and cross-functional nature of projects creates authority and responsibility dilemmas. • Choosing an Appropriate Project Management Structure – A good system balances the needs of the project with the needs of the organization. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–5 Project Management Structures (cont’d) • Organizing Projects: Functional Organization – Different segments of the project are delegated to respective functional units. – Coordination is maintained through normal management channels. – It is used when the interest of one functional area dominates the project or one functional area has a dominant interest in the project’s success. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–6 Functional Organizations FIGURE 3.1 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–7 Functional Organization • Advantages 1. No structural change 2. Flexibility 3. In-depth expertise • Disadvantages 1. Lack of focus 2. Poor integration 3. Slow 4. Lack of ownership 4. Easy post-project transition Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–8 Project Management Structures (cont’d) • Organizing Projects: Dedicated Project Teams – Teams operate as separate units under the leadership of a full-time project manager. – In a projectized organization where projects are the dominant form of business, functional departments are responsible for providing support for its teams. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–9 Dedicated Project Team FIGURE 3.2 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–10 Project Organization: Dedicated Team • Advantages • Disadvantages 1. Simple 1. Expensive 2. Fast 2. Internal strife 3. Cohesive 3. Limited technological expertise 4. Cross-functional integration 4. Difficult post-project transition Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–11 Projectized Organization Structure FIGURE 3.3 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–12 Project Management Structures (cont’d) • Organizing Projects: Matrix Structure – Hybrid organizational structure (matrix) is overlaid on the normal functional structure. • Two chains of command (functional and project) • Project participants report simultaneously to both functional and project managers. – Matrix structure optimizes the use of resources. • Allows for participation on multiple projects while performing normal functional duties • Achieves a greater integration of expertise and project requirements Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–13 Matrix Organization Structure FIGURE 3.4 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–14 Division of Project Manager and Functional Manager Responsibilities in a Matrix Structure Project Manager Negotiated Issues Functional Manager What has to be done? Who will do the task? How will it be done? When should the task be done? Where will the task be done? How much money is available to do the task? Why will the task be done? How will the project involvement impact normal functional activities? How well has the total project been done? Is the task satisfactorily completed? How well has the functional input been integrated? TABLE 3.1 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–15 Different Matrix Forms • Weak Form – The authority of the functional manager predominates and the project manager has indirect authority. • Balanced Form – The project manager sets the overall plan and the functional manager determines how work to be done. • Strong Form – The project manager has broader control and functional departments act as subcontractors to the project. Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–16 Project Organization: Matrix Structure • Advantages • Disadvantages 1. Efficient 1. Dysfunctional conflict 2. Strong project focus 2. Infighting 3. Easier post-project transition 3. Stressful 4. Slow 4. Flexible Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–17 What Is the Right Project Management Structure? • Organization Considerations – How important is the project to the firm’s success? – What percentage of core work involves projects? – What level of resources (human and physical) are available? Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–18 What Is the Right Project Management Structure? (cont’d) • Project Considerations – Size of project – Strategic importance – Novelty and need for innovation – Need for integration (number of departments involved) – Environmental complexity (number of external interfaces) – Budget and time constraints – Stability of resource requirements Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–19 Organizational Culture • Organizational Culture Defined – A system of shared norms, beliefs, values, and assumptions which binds people together, thereby creating shared meanings. – The “personality” of the organization that sets it apart from other organizations. • Provides a sense of identity to its members • Helps legitimize the management system of the organization • Clarifies and reinforces standards of behavior • Helps create social order Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–20 Key Dimensions Defining an Organization’s Culture FIGURE 3.5 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–21 Identifying Cultural Characteristics • Study the physical characteristics of an organization • Read about the organization • Observe how people interact within the organization • Interpret stories and folklore surrounding the organization Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–22 Organizational Culture Diagnosis Worksheet Power Corp. I. Physical Characteristics: Architecture, office layout, décor, attire Corporate HQ is 20 Story modern building—president on top floor. Offices are bigger in the top floors than lower floors. Formal business attire (white shirts, ties, power suits, . . . ) Power appears to increase the higher up you are. II. Public Documents: Annual reports, internal newsletters, vision statements At the heart of the Power Corp. Way is our vision . . . to be the global energy company most admired for its people, partnership and performance. Integrity. We are honest with others and ourselves. We meet the highest ethical standards in all business dealings. We do what we say we will do. III. Behavior: Pace, language, meetings, issues discussed, decision-making style, communication patterns, rituals Hierarchical decision-making, pace brisk but orderly, meetings start on time and end on time, subordinates choose their words very carefully when talking to superiors, people rarely work past 6:00 P.M., president takes top performing unit on a boat cruise each year . . . IV. Folklore: Stories, anecdotes, heroines, heroes, villains Young project manager was fired after going over his boss’s head to ask for additional funds. Stephanie C. considered a hero for taking complete responsibility for a technical error. Jack S. was labeled a traitor for joining chief competitor after working for Power Corp. for 15 years. FIGURE 3.6 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–23 Implications of Organizational Culture for Organizing Projects • Challenges for Project Managers in Navigating Organizational Cultures – Interacting with the culture and subcultures of the parent organization – Interacting with the project’s clients or customer organizations – Interacting with other organizations connected to the project Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–24 Cultural Dimensions of an Organization Supportive of Project Management FIGURE 3.7 Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. 3–25 Key Terms Balanced matrix Dedicated project team Matrix Organizational culture Projectized organization Project Office (PO) Strong matrix Weak matrix Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.