The projects and project management have become an integral part of life for most companies and organizations. They have become inseparable part of the private and public sector organizations. The projects and project management have become an integral part of life for most companies and organizations. They have become inseparable part of the private and public sector organizations. The projects affect the everyday lives of companies, managers and ordinary employees, too. They are not only related to the information technology and the development of its products, but also cover all areas of our lives. The project can be just found anywhere.
Many firms are turning to a project management with the expectation that the project management implementation brings the business success, more attractive working environment and savings to its company. This is maybe the reason that drives the companies to realize its activities in a maximum number through the projects. The projects can be divided into internal projects and external projects - outsourcing. The form of realization mainly depends on the resources, which the company disposes, and decisions about the planning extent to implement the projects on its own. The internal projects are projects covered by the company's internal resources and only minimal, if any, using the external resources. The external projects are in fact projects that are completely or partially carried out by external customers. For internal projects, the situation is very transparent. The project sponsor, project manager and project team are employees of the same company and are often familiar with each other. In addition, the company situation, objectives and design are well known to them. The internal projects very well eliminate the risks of participating uninterested and unaware resources to the project. For external projects, this situation is no longer transparent and there are the misunderstandings and problems so many times that create the project risks. These risks, if are not adequately treated, they become serious problems and could lead to the failure of the project in some cases.
Therefore, let try to look at the external projects in more detail. The most important part of external project is their preparation. In this point, it is essential that the customer very carefully elaborated the project and the scale of project outsourcing. Often times it is just a poorly scope of project documentation the main reason for misunderstanding of authority and escalation towards the provider. If the project description is lax processed and interpretable by different ways, there is a problem that the delivery may not meet the expectations of the customer. Another important decision of customer is the extent which the project wants to be outsourced to. The customer should decide whether he wants to include the project management to the delivery, or not. This decision is a key project decision. In case that the project management is not part of an outsourcing contract, it is important to be ensured by a customer. If a customer decides to provide the project management from its own resources, it is necessary that these „resources” have a sufficient competence and qualifications and also have guaranteed sufficient time to work on the project. In this phase, many customers make a mistake and appoint a project manager from the employee who expect for his own work and duties also has to manage the whole project. In those cases, there arises a situation, when such a project manager - customer, moved his managerial competencies and responsibility for the project to a provider (project manager - provider). If the company outsources, for example, the delivery of information system, its implementation or development is only part of a number of activities under the project. Primary objective of the project is not usually defined as its implementation, but the objectives often are the monitoring of the strategic plans or other companies, such as: increasing work efficiency, modernization of working practices, making company products more attractive or increasing the competitiveness in the market. All of these targets imply the requirement for the implementation of several activities, not only the SW implementation. Essentially, we can divide these activities into two main parts. The first is Change Management - change in work organization, and the second is Software Implementation. Based on these two parts, it is clear that one employee would not be a project manager who is the person responsible for the success of the project and at once the person responsible for the implementation of the software from provider side. As mentioned above, the implementation of software is only a way to achieve the objectives of the project. If the responsibility for managing the project is transferred to the project manager - the provider, directly or indirectly, there is usually the situation that the primary objectives of customer or company begin conformed to the objectives of provider who is responsible for implementing the software. This situation may not indicate the provider failure but just wrong decisions of customer that ill appointed a responsible project manager or he did not afford him the sufficient working conditions or he was allocated preferably to other work activities and then his project manager competencies were only formal.
The result of such decisions is often some problems. The customer’s team does not understand to the provider's team, the expectations are different on both sides, and resistance to the solution implementation as well as its acceptance is shifted away. Consequently, there are frequent modifications in the subject of delivery, the changes in functionality as well as increased costs on the customer side. If the customer finds the provider with a quality project management, these costs are primarily and especially suffered by the customer. The provider has well documented all phases of the project so all the misunderstandings and disagreements are transmitted to the extra pay for every made change. The project is extended, the price is far above planned expenditures, targets were not fulfilled and customer finds that he has been losing the control over the project.
From project management point of view this project can be declared unsuccessful. The problem with project manager selection on the customer side frequently appears in public-sector projects where the provider due to lack of contractor project management surcharges cost of the project and its duration.
Deal with such situations is to establish the project management on required level. In the case of private companies this problem will be solved immediately after the first failed project that costs exceed the projected budget and so reduce the company's profits. In the case of public companies the solutions are the same, but slowly and difficultly applicable. An interesting solution for the government would certainly be the introduction of the central project office of the state or self-governments. The agency would ensure the project management, the administration, control and standardization of project management processes. The number of projects, which government has currently implemented, the central project office can be the source of valuable experiences. Of course, this solution is bounded by the limited possibilities for financing of the project managers in public administration. On the other hand, the savings from the higher professionalism of project management compared with the increased costs would not be negligible.
Wrote: Ing. Martin Chripko, Senior Project Manager, QBSW, a.s. Published in Infoware No 5/2010.
(29.04.2010)
