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    2 The Project Management and Information Technology Context Objectives! After reading this chapter, you will be able to: 1. Describe the systems view of project management and how it applies to infor mation technolagy projects 2, Understand organizations, including the four frames, organizational struc- tures, and organizational culture 3. Explain why stokeholder management and top management commitment are citical for a project’s success 4, Understand the concept of a project phase and the project life cycle and! cis- tinguish between project development and product development 5. Discuss the unique altributes and diverse nature af information technology projects OPENING CASE To Walicrs recently accepted a new pasition at his college as the £ Director of Information Technology. Tom had been a respected faculty m nber at the vollege for the past Fifleen years, The college—a small, private college in the Southwest—ollered a variety of programs rollnent included 1500 full-time traditional students and about 1000 working-adult stucents in the Jiberal arts and professional areas. attending an evening program, Many instructors supplemented their courses with information on the Internet and course Web sites, but they did not offer any distance-leamning programs. The college’s niche region who liked the setting ofa small was serving students in ( THE PROJECT MANAGEMENT AND INFORMATION TECHNOLOGY CONTEXT 39 liberal arts college. Like most colleges, its use of information technol- ogy had grown tremendously in the past five years. There were a few classrooms on campus with computers for (he instructors and stu- dents, and a lew more: with just instructor stations and projec 1 sys= tens, Tom knew that several colleges througlwut the country required that all students lease laptops and (hat these colleges incorporated technology components into most courses. This idea fascinated him, He and two other members of (lu Information Technology departm visited a local college that had required all students t« lease laptops for (he past three years, and they were very impressed w jb what they saw and heard, Tom and hi s staff developed plans to start requiring students (a lease laptops at their college the next year, Tom sent an ¢-mail (0 all faculty and stall in September, whieh briefly described this and other plans. He did not get much response. however, until the February facully meeting when, as he deseribed some of he details of his plan, the chairs of the History, linglish, Philosophy, and Economies depariments all voiced their opposition to the idea. They eloquently stated that the college was noi a technical training school, and that they though the idea was ludicrous, Members of the Computer Science department voiced their concern that all of their students already jack slate: of-the art desktop comput ers and would not want Lo pray a mandatory fee to lease fess-powerfal laptops. The director of the adult education program expressed her concern that many adult-edueation students would balk at an in +s, especially Is of how to at in fees. Tom was in shock to hear his celleagues’ resport aficr he and his staff had spent a lat of lime planning det: implement laptops at their campus, Now what should he do? Many of the theories and concepts of project inanagement are not difficult to understand. What é difficult is implerenting them in varlous environmerits Project managers must consider many different issues when managing projects. Just as each project is unique, so is its environment. ‘This chapter discusses same of the components involved in understanding the project environment, such as using @ systems approach, understanding organizations, managing stakeholders, matching product life cycles to the project environment, and understanding the context of informalion wchnology project: 40 cHAPTER 2 A.SYSTEMS VIEW OF PROJECT MANAGEMENT. Even though projects are temporary and imtended to provide a unique product or service, you cannot run projects in isolation, It project managers lead projects in isolation, it is unlikely that these projects will ever Iruly serve the needs of the organization. Therefore. projects must operate in a broad organi- zational enviranmicnt, and project imanagess need to consider projects within he greater organizational context, To handle complex simuations effectively, project managers need to take a holistic view of a project and understand how it relates to the larger organization. Systems thinking describes this holistic view ol carrying our projects within the context of the organization What Is a Systems Approach? The term systems approach emerged in the 1950s to describe a ho and analytical approach w solving complex problems that includes using a systems philosophy, systems analysis, and systems management, A systems philosophy is an overall model for thinking about things as systems. Systems are sets of interacting consponcnis working within an environment to fulfill some purpose, For example, the human body is a system composed of many subsystems—the nervous system, the skeletal system, the circulatory system, the digestive system, and so on, Systems analysis is a prublem-solvit approach that requires defining the seope of the system, dividing it into irs com- poncuts, and then identifying and evaluating its problems, opportunities. constraints, and needs, Once this is completed, (he systems analyst Lier examines alternative solutions lor improving the current situation, identifies an gpliun, or al least satisfactory, solution or action plan, and examines that plan against the entire system. Systems management addresses Ue business, technological, and organizatioial issues associated with creating, maintaining, and making a change toa system, _ (Fi Media Snapshot ' The Press Association Ltd., the largest news agency in the Linited Kingdom, appeared te have it all as il continued: ia gow’ and dominate its industry, However, management noticed ts profit margins were sling, se they hited a consulting firm to help turn things around, The consultants found the oraan zation’s rapid growth rate helper! extend! its reas Uirauahe oul the country weil The ac yuisilion. af several news organizations, but these dsparate groups were not assimilated into overall operations. People were not sharing work processes anc technologies across the arganization, so nperatinig costs were high Ta salve this problem, lhe consultants suggested using a top-down strategy to make sure projects were initiated ta support key business goals. Richard Stoneham, principal for THE PROLECT MANAGEMENT AND INFORMATION TECHNOLOGY Context Shateye Consutting of Syoiney, Australia, stessed the imporlance of using 3 holistic view of the organization and its projects: “ you approach everything from aystems thinking, yout see avanything 36 cannected..Successful changes fay fo be planned! and managed at the organizational feve! so the whale system is taken into account," Sloneharn alsa suggested releasing short-term resulls in aceite henefits on an incremental basis andl reviewing po ects on a raguiar basis to ensure swategic alignment? Using a systems approach is critical tw successful project management, Top management and project managers must follow a systems philosophy lo understand how projects relate to the whole organization. They must Use sy lems analysis 10 address needs with a problem-solving approach. They must use systems management 10 identify key business, iechnological, and orpaniizas tional issues related to each project in order to identify aud satisfy key stake- holders and do what is best for the entire arganization In the opening case, when ‘tom Walters planned the laptap project. he dil dial ise: a systems approach, Members of the Infraction ‘Technology depart ment did all o! the planning. Even tIingh Tim sent an e-mail describing the laptop project to alll faculty and staff, he did not address many ef the wrpaniza- lignal issues involved in such a complex project. Most. faculty and staff are very busy ar the beginning of fall term and many may not have read the entire tes- sage. Others may have been tao busy 10 communicate theis coeerns te the Information Technology department, Tom was unaware of the effects the lap top project would have on ather parts of the college. He did not clearly define the business, technological, and organizational issues associaled with the proj cel. thm and the Information Technolngy depariinent began work on the lap top project in isolation. I they had taken a systems approach, considering other dimensions of the project, and Involving key stakeholders, hey cauld have idenuified and addressed many of the issues raised al the Tebruary faculty meeting before the meeting. The Three-Sphere Model fer Systems Management Many business amd information technology students understand (he concepts sl systems and performing a systems analysis. However, they often gloss over the topic of systems management. rhe simple idea of addressing the three spheres of sysicms management—business, organization, aid Iechnology—can have a huge impact on selecting and managing projects successfully. Figure 2-1 provides a sample af some of the busi reanizativnal, avid (cele nological issues that could be factors in the laptop preject. In this case, technologi- cal issues, though not simple by any means, are probably the least difficult to identity and resalve, However, projects must address issues in all three spheres of "ackson, Lwane, "Forge Al ead." PM Network (April 2004), pA, a2 CHAPTER 2 the systems managernent model, Although itis easier to focus on the immediate and sometimes narrow concerns af a particular project, project managers and other staff must keep in mind the effects of any project on the interests and needs of the entire syskent or organization *What will the laptop project cost the college? What will i cost students? *What will support costs be? sWhat will the impact be on enrollments? Business *Will the laptop = Se *Shauld the laptops project affect al! students, just traditional students, or only certain majors? Organization sHow will the use Macintash, Windows, or both types of operating systems? What applications software will be project affect loaded? students who already have PCs ar What will the hardware laptops? specifications be? *who will train students, faculty, and staff? How will the hardware impact LAN and Internet access? yvha will administer and support training? Figure 2-1, Three-Sohere viedel for Systems Management Many information technology professionals become captivated with the (ech nology and day-lo-day problem solving invalyed in working will tion systems, They tend to become Frustrated with many af the “peaple probe Jems” or politics involved in most organizations, In addition, many information technology professionals ignore important business issues—such as, *Does it make financial sense to pursue this new technology?” or, “Should the company deyelap this software in-house er purchase it off-the-shelf?" Using a more holistic approach helps project uanagers integrate business and organizalional issues into their planning, [t also helps them Took at projects as a series af inter related phases. When you integrate business and organizational issues imo project planning and look at projects asa series of interrelated phases, you do a hetter job of ensuring project success. Jomma- THE PROJECT MANAGEMENT AND INFORMATION TECHNOLOGY CONTEXT UNDERSTANDING.ORGANIZATIONS The systems approach requires that project managers always view their proj- vets in the context of the larger organization, Organizational issues are often the most difficult paet of working on and managing projects. For example. many people believe that most projects fail because: of company politics, Project managers often do not spend enough time identifying all the stakeholders involved in projeets, especially the people opposed to the: jnjects, Similarly they allen do not consider the politieal context of a project or the culture of the organization. To improve the sucess rare of information technology projects, it is important for project managers to develop a better understanding of people as well as arganizations. The Four Frames of Organizations Organizations can be viewed as havin, resources, political, and symboliee four dilferens frames: structural, human, = The structural frame seals wilh how the organization is structured (usually depicted in an organizational chart) and focuses on different groups’ roles and responsibilities in arder Io meet the goals and policies set by top management, This frame as very rational and focuses an coordi= nation and control. Vor example, within the structural frame, a key infor mation technology issue is whether a company should centralize the Information technology personnel in one department or decentralive across several departments. You will lean moue about organizational siructures in the next section, & The human resources frame focuses on producing harmony benween the needs of the organization and the necds of the people. It recagnizes that there are often mismatches between the needs ol Ihe aryanivation and the needs of individuals and groups aud works to resolve any poten- tial problems. For example, many prrajcets might be more efficient [or the organization {f persouncl worked 80 or more hoursa week for several months. This wark schedule would probably conflict with the personal lives of those people. Important issues in information technology related fo the human resonrevs frame are the shortage of skilled! information technology workers within the organization and unrealistie schedules imposed on many projects. a The political frame addresses organtvalional ane personal politics. Polities in organizations take the ferir af competition among groups or individuals fer power and leadership. ‘The political frame assumes (hal organizations are 2 foluian, Lee Gand Deal, Terrence F., Risin centations, Jossey-Bass Publishers, 199 aa" chapter 2 coalitions composed af varied individuals and interest groups, Qlten, impor- lant decisions need 10 be made based on the allocation ol scarce resources, Competition lor scarce resources makes conflict a central issue in org: tions, and power improves the ability lv obtain scarce resources. Project managers must pay attention to polities and power if they are to be ellective, It]s important to know who opposes your projects as well as who supports them, Important issn in information technology related to the political frame are the power shifts from central funciians te operaling units or [rom functional managers to project managers. m The symbolic frame focuses on symbols and meanings. What is most important about any event in an organization Is not what actually hap- pened, but what it means, Was ila yond sign that the CEO came to a kick olf meeting lor a project, or was ita threat? The syrnibelie frame also relates 10 the company’s culture. How do people dress? How many hours do they work? Ilow do (hey run meetings? Many information technology projects are international and include stakeholders [ram various cultures Understanding those cultures is also a crucial part of the symbolic frame. (®) What Went Wrong 71 Several large organizations have instellec! or tried to inslall enterprise resource planning i (PRP) ystems to inleqiale business functions such as ordering, inventory, delivery, account ing, and human resource management. They understand the potential benefits of anv ERP systern and can analyze its vanous technical ister, bul many companies do not realize how portant Ihe orgarizatitanel ‘ssues are to ERP implementations. example, in carly 200%, Sobey’s, Canada’s sacona largest grocery stew chai with 1400 stores, abandoned its ten-year, }4U-million investment in ani ERP spstemn. The system was daveloped by SAR the largest enterprise software company and the thircelargast soft { ware supplier Unfortunately, the system did riot work properly due to several organizational i challenges. Lvery denartmant has to work logether to implement an ERP system, and itis ooflen cifficull 10 get departments to corrmunicate their needs. As Dalnousie University Associate Protesso’ Sunny Marche states, "The arabiem of building ant imlegratec sysiem i that can accomnmoate differen people is a very serious challenge. You can't divorce tech~ o.agy from the sociocultural issues. They have an equal role." Sohey’s ERP system. shut clown tor five days and emoinyees were scrambling It stock peletnielly empty shelves in several stores for swerks. The system failure cost Sobey's more than $90 million and caused shareholders to take an 82-cent altertax hit oer share? > Hane, Lva, “Sertveaye hardships,” The Hiezali, Halifax, Nowe Canada (2001), THE PROJECT MANAGEMENT AND INFORMATION TECHNOLOGY CONTEXT a6 Project managers musi learn to work within all lour organizational frames to function well in organizations, Chapter 9, Project Human Resource Management, and Chapcer 10, Communications Management, further develop some ul Ut organizational issues. The following sections on organi- zational siructures, stakeholder management, andl the need for top manage. ment commitment provide avlditional information related to the sirtictural and political frames. Organizational Structures Many discussions of organizations focus on organizational structure, Three general classilications ol organtizalianal structures are functional, project, and matrix, Mast companies today involve all three structures somewhere in the ouganization, but one is usually most canumon. higure 2-2 portrays these three organizational structures. A functional organizational structure is [he hier- archy most people think of when picturing an crganizational chart. Functional inanagers or vice presidents in specialties such as engineering. manulactur information technology {IT}, and human resources (HR) report tw the chiel executive ullicer (CHO), Their stalls have specialized skills in their respective disciplines, bor example, most colleges aul universities have very strong fune= tional organizations. Only faculty in the Business department icach business courses; lacully in the Llistory department teaels history: faculty in the Art department teach art, and so on, A project organizational structure also has a hicrarchisal structure, but instead af functional managers or vice presiderts reporting to the CEO, pro- grani managers report to the CEO. Their staffs have a variety of skills needed to complete the projects within their programs. An prganivait that uses this structure vars [heir reyenue primarily from performing projects lor other groups under contract, For example, many defense, architectural, enginver= ing. and consulting companies use a project organizational structure. These companies uflen hire people specifically ta work on particular projects, A matrix organizational structure represents the middle ground lehween functional and project structures, Personnel often report ty bot a functional manager atl one or mare project managers. Fur example, information tecl- nology personnel at many cempanies oflen split their time betwee lwo or more projects, bul they report to their manager in the Information Technology deparimeril. Project managers in matrix erganivarions have stalf {rom various functional areas working on their projects, as shown in Figure 2-2. Matrix organizational struclures can he strong, weak, or balaneed, based on the amount al control exerted by the project managers, 6 CHAPTER 2 Functional cEO VP Engineering VP Manufacturing. VPIT. WP HR | staff Staft Staff Staff | Project cEO Program Manager A Program Manager B Program Manager ¢ Staff Staff | Staff Matrix

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