7 Organization Issues in Project Management
7 Organization Issues in Project Management
7 Organization Issues in Project Management
Unit 7 Organizational Issues in Project Management
Structure
7.1 Introduction
7.2 Organizational Change
7.2.1 Evolutionary Change
7.2.2 Revolutionary Change
7.3 Traits of the professional manager
7.4 Bringing about Organizational change in the Project Management Scenario
7.5 Summary
TQ’s
Answer to SAQ’s and TQ’s
7.1 Introduction
Projects by their nature are not amenable to any streamlined operations. Various activities across all
functions are undertaken by a number of people. The project manager and his team committed to
any one project will have to depend upon the various functionaries in the administrative functions like
Human Resources, Finance, Purchase, Legal etc. at various points of time to coordinate their
activities However, no project manager will need them on a continuous basis. The project manager
and his core team have the responsibility for the project and support services will have to cater to a
number of them.
Each project is operated like a small company by itself. All the resources required for each project
are assigned to work on that project. The project manager has complete project and administrative
authority over his team. This differs from the matrix functional type of structure, where the people in
the project would be controlled in technical aspects by the project manager, but administrative control
is exercised by the functional managers. Organizational change as a process has implications for
the project type organizational structure. Generally, there is no opportunity for members of different
Sikkim Manipal University
96
Project Management Unit7
teams to share knowledge and experience. Latest developments in organizations are in the fields of
knowledge management, where such sharing should not only be made possible, but obligatory for
effecting economy both of physical resources and time.
Learning Objectives
1. The meaning of Organizational Change
2. The need for change in Project Management Scenario
3. How a Professional Manager can implement change
4. Latest developments in the process of organizational change relevant to Project Management.
7.2 Organizational Change
Organizations will have structures, hierarchies, functions, communication patterns, decision centre,
and most importantly cultures – which define them and make them unique. To cope with new
challenges, to introduce new products or services, to take up new opportunities and to take on
competition the organizational members have to implement changed practices. We have mainly
two types of changes to contend with. The first is the evolutionary change which is gradual,
incremental and with a narrow focus on one or a few processes. These changes take place as the
organisation evolves and in an effort to ward off some impending problems, they are implemented.
The second occurs as a result of drastic structural changes, a new technology, a new thrust for a
huge increase in capacity, a new business acquisition, implementation of a new strategy. We call
this revolutionary change. The four important instruments are reengineering, EEngineering,
restructuring and innovation.
7.2.1 Evolutionary Change
The following are a few cases of evolutionary change
a) Sociotechnical changes take place as the organisation evolves over time. The managers need
to optimize both the technical and social systems for promoting effectiveness. They adjust both the
systems gradually so that group norms and cohesiveness are not disrupted. This also helps in
avoiding grouplevel resistance to change. However, changes in the way tasks are performed do
change perception among workers about their own groups which might have been disrupted owing to
Sikkim Manipal University
97
Project Management Unit7
technical requirements. The purpose of these changes is to bring in continuous improvement in
product quality.
b) Total Quality Management is an ongoing effort among members across functions to find new
ways to improve quality in products and services. This change process, though incremental requires
both workmen and managers to adopt new ways to viewing their roles in the organisation.
7.2.2 Revolutionary Change
The following are a few cases of Revolutionary Change
a) Reengineering This is a process by which managers redesign a bundle of tasks into roles and
functions so that organisational effectiveness is achieved. By doing so dramatic improvements in
critical measures of performance like cost, quality and service are expected. There will be a radical
rethink about the business processes adopted.
i) Make changes with the outcome in mind – not the tasks that result in them.
ii) Make the users of the results of the process effect the change
iii) Let the people on the spot decide on the solution – decentralize
b) EEngineering – The term EEngineering refers to the attempts of companies to make use of all
kinds of information systems, to make their functions efficient. New information systems are installed
for conducting all business processes in the organisation. The use of electronic communication
Sikkim Manipal University
98
Project Management Unit7
within the organisation enable frequent interactions between employees and results in better
communication. Meetings require their presence, but with teleconferencing a lot of time is saved.
Data have repositories which are accessible, transferable and updatable instantly and used by all
concerned. Crossfunctional workflows make it easier to coordinate activities. The increase in
efficiency makes the organisation to meet customers’ requirements faster.
All these result in widespread utilization of knowledge in the organisation. It helps in creating and
making available high quality of information. The information system using intranet and internet
solutions to carry on their regular activities on line.
c) Restructuring – This is attempted with change in authority and task relationships of managers.
The move from the functional form or a standard division structure, to combine or divide areas of
control and authority to facilitate better coordination and/or workflow can be restructuring. In the
process, a few jobs may not be there. A few people may have multifunctional activities. The main
purpose is reduce bureaucratic costs. This is because a change in strategy is considered.
Downsizing is a way of restructuring.
d) Innovation – it is the successful use of skills and resources in such a way that their response to
customers’ needs effective. Changes in technology have made computers cheaper, faster and more
user friendly. This has made a thorough change in the skills of employees and managers. Every
company needs to adopt new methods – find them – to make them relevant in the changing world.
The thrust in every department/function should be to do things better with new methods. A culture
that promotes this thought across the organisation is the best way to benefit from it. For promotion,
suitable people have to and be selected, trained, empowered and rewarded. A thorough change in
the way problems are solved is needed.
The Project Manager may have to initiate the change process to increase the effectiveness of his
team. Being a key person in the organisation, his actions are always under scrutiny. If he takes
initiative, whenever the opportunity arises, to effect incremental changes, the resistance both by the
top management and his team members will be nonexistent.
Sikkim Manipal University
99
Project Management Unit7
Self Assessment Questions1: Fill in the blanks
1. Organizations will have ________, __________, ________ , and most importantly cultures –
which define them and make them unique
2. Make changes with the ________in mind and not the ______that result in them.
7.3 Traits of the professional manager
The following traits enable a manager to be effective in his functioning. Endowed with these it will be
easy to be effective. The top management will look for these in a person who they want to employ
for project management.
(a) Leadership – These managers lead by exhibiting the characteristics of leadership. They know
what they should do, know why they are doing it, know how to do it and have the courage and will to
do it. They have the power of taking along with them others.
(b) People Relationships Any leader without followers cannot be successful. They have excellent
human relationship skills. The manager builds up his team based on the core values of sincerity,
objectivity and dedication. He ensures that his subordinates get opportunities for growth based on
performance. He makes them a part of the decision making process, thus ensuring cooperation and
commitment during implementation. He delegates freely and supports them.
© Integrity Highest levels of trust, fairness and honesty are expected while dealing with people both
within an outside the organisation. This includes the customers, shareholders, dealers, employees,
the government and society at large. They ensure that functioning is clean. Their transactions will
be transparent. Ethics is something they practice diligently.
(d) Quality – The quality philosophy should not cover only the product quality, but every process that
has gone into making it. Economy of words when instructions are given, acknowledging compliance,
arriving on time, remembering the promises and above all a keen eye for details and patience to
make others know what they want are components of quality.
Sikkim Manipal University
100
Project Management Unit7
(f) Innovation and creativity Professional managers think beyond the obvious. They exhibit a
keenness to go behind a problem and attempt to find the root cause of the problem. They will draw
from their experience from diverse fields, seek further information and consider all possible
alternatives and come out with some new and unique solution. This happens when they have open
minds. A saying goes the human mind is like a parachute, it is useful only when it is open. Such a
work culture is very conducive for problem solving – which is the aim of all creativity. Their
persistence will reward them. Such actions observed by their team members enthuse them and a
spirit of adventure will bring about better solutions faster.
1. Objectives/Performance standards are set.
2. These are communicated to the employees.
3. Review/monitor the above.
4. Check actual performance Vs. Standards set.
5. Identify gaps.
6. Jointly decide on corrective action, if needed.
7. Reset objectives for next period
Sikkim Manipal University
101
Project Management Unit7
1. Objectives/Performance Standards Are Set
1. To mange any criterion, it is necessary to measure the factors that were responsible for ‘what is’.
The quality of the input, their quantity and their intended usage. Then measures of the utilization the
processes used, their suitability, and the difficulties faced in utilization and how they were resolved.
Then the outcomes – are they as they were expected. Performance closer or beyond expectation is
the degree of quality. For every employee the level of achievement is set in terms of quantities and
extent to which the performance approached the standard. This is the basis for evaluating
performance.
2. These are communicated to the employees This procedure ensures that they know what is
expected of them and help them to adjust their activities in such a way as to meet them. This
enables them to seek help, consult their colleagues or bosses, learn– so that they will meet the
expectations. It is possible that some objectives cannot be met at all. The communication to his
boss, may help in reallocating the job, so that there will be no hiccups at the end of the period.
4. Check actual performance Vs. Standards set This is the evaluation phase. Comparison on
every detail is made. Differences are recorded. Particular areas are chosen for improvement.
Sikkim Manipal University
102
Project Management Unit7
7. Reset objectives for next period The targets are revised either upward or downward depending
on the conclusion of the appraisal process.
(h) Identification with the organisation A sense of pride and belonging goes with the “ownership” of
the job, the project, team members and organisation. This is brought about by the culture and
communication system in the organisation. Information sharing brings in trust and promotes
belongingness. The tendency seen is that most managers strongly identify with their own
departments, units or divisions and they lack a sense of organisation.
In the light of increased competition and ever changing strategies to develop business orientation,
which in effect means every manager should be aware of the company’s plans, products and
policies. An obvious corollary to this is that the organization’s communication policy too should be
conducive to such information sharing. Today, many organizations are using interventions such as
team building, survey feedback, and other activities, to ensure that employees build up a strong
sense of identity and pride in the organisation they work for.
(j) Coping with changes: It is often said – ‘The only constant in this world is change’. A professional
manager has the ability and capacity to cope with change. He accepts the fact that change is
inevitable and is ready to implement change at the workplace. To implement change successfully, it
is essential that employees are involved in the implementation of change. Further the positive and
negative consequences of change need to be discussed and understood before implementation.
Sikkim Manipal University
103
Project Management Unit7
Thus a professional manager has the attitude to accept change as a way of life and takes it in his
stride
Self Assessment Questions2
1. Such a work culture is very conducive for _________ which is the aim of all creativity.
2. To implement change successfully, it is __________ that employees are involved in the
_____________ of change.
3. Project managers do not delegate authority, they delegate responsibility. TRUE/FALSE
7.4 Bringing about Organizational change in the Project Management Scenario
A project is managed by the project manager being completely in charge of all matters connected
with it. In case of organizations, where multiple projects are handled, restructuring is almost a
continuous. The reason is that resource availability in terms of people and their skills will be
changing. With resource smoothing, many persons will have to be shifted for short periods. To
accommodate these, many managers create pools of persons with special knowledge, skills and
ability. Number of opportunities for creativity is many in project execution. Every project is unique.
Resources vary, customer demands are different. Thus the change process will have never stopped
to begin.
Self assessment Questions3:True or False
1. Opportunities for creativity are many in projects.
2. When multiple projects are handled restructuring is rare.
7.5 Summary
In this unit you have learnt about how the organizations are structured. The meaning of
Organizational Change and how the process brings about improved effectiveness in the
organizations, especially the need for change in Project Management Scenario. You have also
learnt about the role of a professional manager and how a Professional Manager can implement
Sikkim Manipal University
104
Project Management Unit7
change. Also the latest developments in the process of organizational change relevant to Project
Management.
Terminal Questions
1. Define a Flexible Work Team.
2. What is Reengineering?
3. What are the seven steps of performance management?
4. What is empowerment?
5. Explain the difference between TQM and Innovation
6. Describe any five important traits of a Leader
Answers to Self Assessment Questions
SELF ASSESSMENT QUESTIONS1
1Structures, hierarchies, functions, communication patterns, decision centres,
(any three of these)
2 Outcome, tasks.
SELF ASSESSMENT QUESTIONS2
1problem solving
2 essential, implementation
3False
SELF ASSESSMENT QUESTIONS3
1 True, 2False
Sikkim Manipal University
105
Project Management Unit7
Answer to Terminal Questions
1. Refer to 7.2.1
2. Refer to 7.2.2
3. Refer to 7.3 (g)
4. Refer to 7.3 (f)
5. Refer 7.2.1 and 7.2.2
6. Refer to 7.3
Sikkim Manipal University
106