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Chapter 2: Project Management Growth (Concepts and Definition) Five questions help to determine whether formal project management

is necessary or not: Are the jobs complex? Are there dynamic environmental considerations? Are the constraints tight? Several activities needed to be integrated? Several functions boundaries to be crossed?

Not all industries need project management. Manufacturing industries with slowly changing technologies doesnt need the project management unless there is a requirement which will be using the company capital equipment, which might lead to the interruption of the normal routine activities. Project management always requires the organizational restructuring. Project management restructuring has permitted companies to: Accomplish task that could be not effectively handled by the traditional structure Accomplish onetime activities with minimum disruption of routine business.

Project management structure is a temporary structure which causes minimal organization disruption. There were some major problems caused by those managers who having problems in the conflicts and resources. The problems would be: 1) Project priorities and competition for the talent may interrupt the stability of the organization and interfere with the long range planning of the normal business. 2) Long range planning suffer as the company gets involved with the meeting the schedule and fulfilling the requirements of the temporary projects. 3) Shifting people from project to project may hinder the growth and development of the personnel self development and growth. There were several driving forces behind the project management approaches. The six imperatives would be: The time span between project initiation and completion appears to be increasing. The capital committed to the project prior to the use of the end item appears to be increasing. As technology increases, the commitment of time and money appears to become flexible. Technology requires more specialized manpower. Project management if properly implemented, can make it easier for the executives to overcome such internal and external obstacles as: Unstable economy Shortages Soaring cost Increased complexity

Heightened competitions Technological changes If the above obstacles are not controlled; this may result in: Decreased profits Increase manpower needs Cost overruns, schedule delay and penalty payments. Inability to cope up with new technology. Temptations to make hasty decisions. Management insisting on earlier and greater return of the investment.

Project management became more necessity for many companies as they are expanded into multiple product lines, which was more dissimilarity and organization complexity grows. This growth can be attributed to: Technological increasing at an astounding rate. More money invested in R&D More information available. Shortening of life cycles.

Life cycles for project management maturity 1) 2) 3) 4) 5) Embryonic Phase Recognize needs Recognize benefits Recognize applications Recognize what have to be done. Executive Management Acceptance phase Visible executive support. Executive understanding of project management. Project sponsorship Willingness to change the way of doing business. Line management Acceptance phase Line management support Line management commitment Line Management education Willingness to release the employees for training Growth phase Use of life phase cycles Development of project management methodology Commitment to planning Selection of project tracking system Maturity phase Development of management cost/ schedule control system Integrate cost and schedule control Developing an educational program to enhance project management skills

There are six driving forces that lead executive to recognise the need for the project management: 1) 2) 3) 4) 5) 6) Capital project Customer Expectations Competitiveness Executive Understanding New project development Efficiency and Effectiveness

Recognising that the organization can benefit from the implementation of project management is just the starting point. In the beginning of the implementation process, there are chances for the cost level to off and become pegged. This is because of the added expenses to develop the project management methodology, scheduling, planning and controlling. There is a point where benefit is equal to cost of implementation. This point can be pushed to left through educational and training.