Leading the Change to a Project-Based Organization
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 A Scenario

Many upper managers voice increasing frustration with the results of projects undertaken in their areas of responsibility. They lament that despite sending people out for training and buying project management software, projects seem to take too long, cost too much, and produce less than the desired results. Why is that? To help understand the problem, consider the following scenario.

An upper manager gets an idea, perhaps from reading a book or attending a conference, and has a vision of a product or service that the organization can offer. This vision may differ from what the company normally provides, so creating the product becomes a special project. Talking it over with associates, the manager is delighted when one of the best engineers becomes interested. To get the concept rolling, the manager asks this engineer to manage the project. They both figure the project can be done quickly because the engineer has achieved good results on past work. The new project manager talks to a few friends, and soon a team of engineers begins working on the design. After a while, the team comes back to the upper manager with good news and bad news. The good news is that one needed technology is available inside the organization; it was developed in another division, however, so the team needs to borrow a few people from there to get it. The bad news is that another needed technology is not available in the organization, so new people will have to be hired. The upper manager arranges to borrow people from the other division and authorizes the new outside hires.

Delay begins about here. The new hires must be approved by the executive committee and then must have job descriptions defined and developed by the personnel department. As these new people know the latest technology, they are expensive; even so, once on board it takes them longer than expected to become productive because they are not used to the ways of their new employer. Eventually, however, the whole group gets working-until a manager from the other division, for which this special project is not a priority, takes back the borrowed engineers. Work slows again as the upper manager tries to negotiate their return. Some engineers are finally freed for the project, but not the same ones as before, so there are more delays until they are brought up to speed. When work finally resumes, questions arise about marketing the new product and about using patented technology to create it. The upper manager must therefore add people from the marketing and legal departments to the project. Sure enough, the lawyers ascertain that the new hires inadvertently used a technology patented by another company; the upper manager must decide if it is cheaper to pay for its use or develop an alternative technology. The new project team members from marketing are difficult to communicate with because marketing uses a different e-mail system than that of engineering and legal. Decision making is further delayed as upper managers argue over a number of manufacturing issues that had come up on previous projects but were never resolved.

The team grows disgruntled as it becomes clear that the great engineer is not skilled in planning and conflict management; the situation is not improved when the engineer disappears for several weeks to fix problems that have arisen from a previous project. Elsewhere in the organization, people begin to grumble that the project is costing lots and accomplishing little. The upper manager spends time justifying the project to other department managers but cannot avoid finally being called before the executive committee to explain why it is taking so long and costing so much.

If this scenario seems at all far-fetched, consider this letter received by one of the authors:

"I work in a planning and distribution organization. My duties include leading efforts that are called projects and generally I'm fixing a problem with a process or system. Rarely do I get due dates or objectives ... and when I press my sponsor[s] on this point they tell me essentially that they just want it done. Coupled with this the department has difficulty achieving the full intent of the objectives, and we are pretty unproductive (we don't get many projects completed in a year). We are putting together a proposal including development of dedicated project managers in the organization whose entire job is to lead the projects of the organization (as opposed to the current method of choosing people whose work is closely aligned to the project).

"Unfortunately some managers feel strongly that they do not want their resources utilized by the project managers (and subject to the project manager's discretion). Plus they want to have access to their people to pursue their own objectives (this includes assigning one of their people as project lead[er] regardless of skill). At this point we need help in convincing these managers to support the process of project management..."

You can almost hear the voice trailing off in a sigh of frustration.

Another problem is the assumption that project work should take about as long as traditional work. This sets expectations that can never be met, so projects always seem slower and more costly than other activities. Actually, they should take longer; project work represents something new and different, so the inevitable unknowns, such as those in the scenario, should be factored into the expected length. It is also a false assumption that project work can be handled in the same way and using the same organization and the same people as other work. In reality, because project work is different it requires a project-based organization. The project in the scenario failed because upper management had not created an environment for project success.



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