Chapter 2 The Project Management and Information Technology Context Information Technology Project Management Fourth Edition Learning Objectives Describe the systems view of project management and how it applies to information technology projects Understand organizations including the four frames organizational structures and organizational culture Explain why stakeholder management and top management commitment are critical for a project s success 2 Learning Objectives Understand the concept of a project phase and the project life cycle and distinguish between project development and product development Discuss the unique attributes and diverse nature of information technology projects 3 Projects Cannot Be Run in Isolation Projects must operate in a broad organizational environment Project managers need to use systems thinking Taking a holistic view of a project and understanding how it relates to the larger organization Senior managers must make sure projects continue to support current business needs 4 A Systems View of Project Management The term systems approach emerged in the 1950s to describe a holistic and analytical approach to solving complex problems Three parts include Systems philosophy View things as systems which are interacting components that work within an environment to fulfill some purpose Systems analysis Problem solving approach Systems management Address business technological and organizational issues before making changes to systems 5 Media Snapshot The Press Association Ltd the largest news agency in the United Kingdom hired a consulting firm to help turn things around after management noticed that its profit margins were sliding The consultants suggested using a holistic view and a topdown strategy to make sure projects supported key business goals They also suggested releasing short term results to accrue benefits on an incremental basis and reviewing projects on a regular basis to ensure strategic alignment Jackson Lynne Forge Ahead PM Network April 2004 p 48 6 Figure 2 1 Three Sphere Model for Systems Management 7 Understanding Organizations Structural frame Focuses on roles and responsibilities coordination and control Organization charts help define this frame Human resources frame Focuses on providing harmony between needs of the organization and needs of people Political frame Assumes organizations are coalitions composed of varied individuals and interest groups Conflict and power are key issues Symbolic frame Focuses on symbols and meanings related to events Culture is important 8 What Went Wrong Many enterprise resource planning ERP projects fail due to organizational issues not technical issues For example Sobey s Canadian grocery store chain abandoned its two year 90 million ERP system due to organizational problems As Dalhousie University Associate Professor Sunny Marche states The problem of building an integrated system that can accommodate different people is a very serious challenge You can t divorce technology from the sociocultural issues They have an equal role Sobey s ERP system shut down for five days and employees were scrambling to stock potentially empty shelves in several stores for weeks The system failure cost Sobey s more than 90 million and caused shareholders to take an 82 cent after tax hit per share Hoare Eva Software Hardships The Herald Halifax Nova Scotia 2001 9 Many Organizations Focus on the Structural Frame Most people understand what organizational charts are Many new managers try to change organizational structure when other changes are needed Three basic organizational structures Functional Functional managers report to the CEO Project Program managers report to the CEO Matrix Middle ground between functional and project structures personnel often report to two or more bosses structure can be a weak balanced or strong matrix 10 Figure 2 2 Functional Project and Matrix Organizational Structures 11 Table 2 1 Organizational Structure Influences on Projects 12 Organizational Culture Organizational culture is a set of shared assumptions values and behaviors that characterize the functioning of an organization Many experts believe the underlying causes of many companies problems are not the structure or staff but the culture 13 Ten Characteristics of Organizational Culture Member identity Group emphasis People focus Unit integration Control Risk tolerance Reward criteria Conflict tolerance Means ends orientation Open systems focus Project work is most successful in an organizational culture where these characteristics are highly prevalent and where the other characteristics are balanced 14 Stakeholder Management Project managers must take time to identify understand and manage relationships with all project stakeholders Using the four frames of organizations can help you meet stakeholder needs and expectations Senior executives and top management are very important stakeholders 15 Importance of Top Management Commitment Several studies cite top management commitment as one of the key factors associated with project success Top management can help project managers Secure adequate resources Get approval for unique project needs in a timely manner Receive cooperation from people throughout the organization Learn how to be better leaders 16 Need for Organizational Commitment to Information Technology IT If the organization has a negative attitude toward IT it will be difficult for an IT project to succeed Having a Chief Information Officer CIO at a high level in the organization helps IT projects Assigning non IT people to IT projects also encourages more commitment 17 Need for Organizational Standards Standards and guidelines help project managers be more effective Senior management can encourage The use of standard forms and software for project management The development and use of guidelines for writing project plans or providing status information The creation of a project management office or center of excellence 18 Project Phases and the Project Life Cycle A project life cycle is a collection of project phases that defines What work will be performed in each phase What deliverables will be produced and when Who is involved in each phase How management will control and approve work produced in each phase A deliverable is a product or service produced or provided as part of a project 19 More on Project Phases In the early phases of a project life cycle Resource needs are usually lowest The level of uncertainty risk