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PART II | RELATED STUDIES AND LITERATURE Many authors have shared ideas and statistics of different issues in project

management but few recognized the relevant of methodology as an issue in project management. This chapter will present related studies or literature which may support the research topic. According to University of Western Sydney, projects possess common characteristics and these are unique task, specific result, resources and time limit. Giving the first characteristic, unique task describe as like “one-off” which means project is consider doing something that never been done. It is almost the same as the specific result, only it is about delivering new output when the project finished. In a project, there are elements which attributes, it is the resources that is allocated. Time, money and people are the common resources needed in a project. And the last one is the time limit, project is temporary, it has beginning and ending. Project always have a distinct range to start and finish which means it has deadline or target date to complete the project. (http://www.uws.edu.au, 2013) Project management is defined by Project Management Institute as the application of knowledge, skills, tools, and techniques to a broad range of activities in order to meet or exceed stakeholder needs and expectations from a project. (http://www.pmi.org) University of California supposed methodology contains definitions, guidelines and templates for the project management activities needed to deliver success and will make the project manager’s easier. (http://www.its.uscs.edu, 2012) The book Systems and Designs by Kenneth E. Kendal and Julie E. Kendal state that methodology is any approach for analyzing, designing, implementing, testing, maintaining and evaluating an information system. (Kendall & Kendall, 2011, p. 563) From Analysis of Possibility for establishing Project Management Office (PMO) in companies in Serbia – a study said that methodology includes processes, procedures, models, best practices, standards, guidelines, policies

and all other elements used to conduct managerial and technological activities. (Milin, Moraca, Radakovic, Jasarevic, & Hadzistivic, 2012) From the definition given by resources above, it is admitted that methodology is helpful to the project manager and a team in setting up a project from beginning until it is finished. But the researcher must find out how it becomes an issue in a project management. As the research goes on, the proponent discovered different

methodologies with different advantages and disadvantages to choose by the project manager which can be use to support the whole project. The proponent learned that to choose what methodology is going to use, the project manager must be aware of which fits perfectly on the team and to the project itself. In accordant with Systems Analysis and Designs, the first thing the project manager must do is to understand the organization. (Kendall & Kendall, 2011) Then other activities will follow. And project manager may set what methodology to use. The research got a line of what the methodology is which is also based from references. The exponent is now collected supporting papers desiring to elaborate on how it becomes an issue if it executed poorly, how the proponent say there is a poor execution and what effects it can be done in the whole project. Given that a team or project has already a methodology or set of methods which fits for them and the project and will guide them to have the project successfully completed, the risk now is may encounter during its development. Since there is a chosen methodology, the development part also has its methods to be followed such as every change must be recorded, identify risks and involved users in the development. If one failed to comply with the method, there is also a chance of re-doing the work and failed to accomplish the task in particular deadline or that there may will be deficiency in a particular part. When it happened, it means that method is executed poorly because if method(s) is successfully followed project manager knows how to control the situation.

According from a study – Analysis of Possibility for establishing Project Management Office (PMO) in companies in Serbia, the methodology establishes the best practices of the organization, improving communication within the organization and minimizes duplication of effort to achieve the same results. (Milin, Moraca, Radakovic, Jasarevic, & Hadzistivic, 2012) The proponent agreed on this as it is almost the same as what was stated by her. From a survey report of KPMG with regard to project management, there is part where they put attributes of project success (based from data they gathered) and these are the following: (KPMG New Zealand Project Management Survey 2010, 2010)           Have high level project management capabilities Have projects that are aligned with corporate strategy Deliver projects within a programme of work or a portfolio Co-ordinate projects through a Programme or Project Management Office provide for effective sponsorship which delivers clear direction for the project and escalates problems when necessary Initiate projects with robust business cases Actively manage risks practice regular reporting, with accurate and up to date information report variations and implement recovery actions ensure that their project managers use a methodology

Based from the data presented above, there are attributes stated which are related to the methodology. First is the “Have projects that are aligned with corporate strategy” and “Deliver projects within a programme of work or a portfolio”. In proponent’s perspective, it is related to methodology is because when you have your programme of work or portfolio as they described, it means that its project management has methodology and follows the set standards. And as methodology as defined earlier as a tool, hence, methodology may be part of the corporate’s strategy. The result of their survey showed that those organizations who took a wider portfolio view of their projects achieved stated

deliverables more often than those who ran projects in isolation. (KPMG New Zealand Project Management Survey 2010, 2010) Next is “Practice regular reporting, with accurate and up to date information”. It is the almost the same as the first one, the proponent believed that it is a procedure which is part of the selected methodology. Another one is the “report variations and implement recovery actions”; it is what the proponent is trying to impart, it is if a project has a methodology the project may come up for variety of back up plan(s) for recovery actions. From the above information, the proponent shows how proper use of methodology helps to deliver success of the project. Another survey report study on the current state of project management by PWC was conducted. After analyzing data gathered, they come up with different observations which concerns with methodologies in project

management. Below are the observations which the proponent found from the report: (I n s i g hts and Trends: Current Portfolio, Programme, and Project Management Practices, 2012)  The percent of organizations that use established PM methodologies is stable, and employees are obtaining the applicable certifications. Using these methodologies increases success in the key performance indicators of quality, scope, budget, time, and business benefits.  Leveraging efficient and effective communication methodologies positively impacted a project’s quality, scope, and business benefits, but showed a negative correlation with budget and schedule. This is the same trend noted in the use of employing an organization’s “typical” PM approach. Data further suggests that Executive Management agrees that the use of communication methods have a higher positive effect on success of projects than the other respondents within the survey population. Based on their responses, there was a 7% increase in delivering of scope, 4% increase in meeting quality standards, 4% increase in delivering intended business benefits, and 8% increase in finishing within or ahead of

schedule.

The

largest

increase

(17%)

in

the

use

of

effective

communication methodologies was found in finishing within budget. Aside from the observations above, PWC also added that “Advancements in PM methodologies leading to greater organizational maturity have raised the bar for standards in project maturity.” Below is the elaboration of this view. As maturity levels indicate, there have been significant increases in organizational maturity since our 2004 report. In this competitive business environment, businesses focus on maximizing resources, efficiency, and effectiveness through PM. Effective tools, along with innovation, aid

organizations to measure progress, increase value, minimize risks, reduce costs, and promote the on-time delivery of projects. Not only have organizations raised the bar in order to stay competitive in the turbulent business environment, but PM standards have also significantly increased. Processes, organizational structure, systems and tools have all been enhanced to better meet business objectives. PM takes costs out of processes and allows organizations to focus on performance. PM practitioners look to performance indicators to define areas where PM methodologies can be maximized. Approximately 76% of survey respondents reported PM training and development opportunities available within their organization, and more practitioners are becoming certified in PM with an increased adaptation of Agile PM and EVM. Organizations are enhancing their portfolio management systems as organizations grow and mature, and are seeing increased success within the five key performance indicators. Effective PM tools create strategic alliances with vendors as well as other businesses as more tools are utilized and tasks can be outsourced. With the use of external tools, resources, and channels, organizations not only look internally to see where PM and process improvement can be adapted, but also look externally to their vendors to utilize PM methodology. Organizations that require vendors to have Quality Management Systems report 90% or more of their projects meet quality standards. (I n s i g hts and Trends: Current Portfolio, Programme, and Project Management Practices, 2012)

Another point is “Using Established PM Methodologies increases success in the key performance indicators of quality, scope, budget, schedule, and business benefits.” It was elaborated with figure which will be presented as an attachment of the paper. For each of the five performance indicators, survey data indicate that using a preferred PM methodology increases the chance of organizations meeting project objectives. As shown in Figure of the attachment, the percent of organizations that are successful in each dimension is higher for organizations that use methodologies than those that do not. The increase in performance is between 5% and 9%, with scope performance being the most improved. Similarly, organizations that meet objectives for a key performance dimension less that 25% of the time are more likely to not use project management methodologies, with performance spreads between 3% and 9% between those that do and do not use methodologies. Response data indicate that organizations with the highest project success rates use in-house methodologies or combinations of methodologies. This result indicates these organizations may have a greater investment in PM methodologies that meet their unique situations. (I n s i g hts and Trends: Current Portfolio, Programme, and Project Management Practices, 2012) The report also stated this key point: “The adoption of PfM has not increased amongst organizations, but its use leads to increases in the key performance indicators of quality, scope, budget, schedule, and business benefits.” The 2004 survey report addressed portfolio performance as a secondary effect of enhanced PM capabilities. One of the primary conclusions drawn from the survey was that maturity levels did matter and that they improved not just project performance, but that of the portfolio of all projects. The 2007 survey results pointedly defined the emerging practice and stressed that its purpose was to promote the achievement of strategic business objectives. The report highlighted the increase in organizational adoption of PfM (53%, a 7% increase from 2004), and drew attention to the degree to which respondents leveraged

various PfM capabilities, with Project Selection being the most common. In 2012, the survey results do not show an increase in adoption (remained at 53%), but they do provide a much more robust look at the effects of PfM and the tools that are available to support it. Since the adoption rate has not increased, we wanted to show where PfM is being used by depicting which industries and sectors are using PfM in Figure at the attachments. From these, PWC listed benefits of adopting Project Management Methodology: (I n s i g hts and Trends: Current Portfolio, Programme, and Project Management Practices, 2012)  Adoption of PfM has positive effects on both project performance and performance of the overall portfolio at all portfolio scales (portfolios with project investments valued at <US$100M to those of >US$60B).  Combining portfolio scale with the dimensions of average project duration (ranging from < 1 year up to 6-10 years), the number of projects managed in the portfolio (<20 to 100+) and the number of people involved in the average project (teams of 10 or less to 200 or more), we investigated the effect of PfM at varying levels of portfolio complexity; the gains of adopting PfM hold at all levels of complexity.  Users of PfM agreed that their organization’s project management capabilities were effective and efficient at much higher levels than those that did not use PfM.  The benefits of deploying PfM are compelling for organizations at the margins of performance. Nearly two thirds of respondents that employ PfM reported that more than 90% of their organization’s projects perform to expectations on the five key performance indicators. In contrast, seven out of ten organizations that do not employ PfM reported that less than 10% of their projects met the key performance indicators. This phenomenon was even starker for highly complex portfolios.

As the proponent gathers information, she starts to understand how methodology related to project management and how its poor used becomes an issue. The analysis and findings will soon be discussed next on this chapter.