About the Author

Brian Irwin, MSM, PMP, has more than 15 years of project experience in diverse industries including personal computers, engineering, information technology, aerospace, and defense. He is currently the president of PM Team Dynamics (www.pmteamdynamics.com), a project management consulting firm specializing in project audits, troubled project assessment and recovery, and project startup facilitation.

Mr. Irwin formerly worked for Hewlett Packard in Fort Collins, Colorado, where he tested midrange LINUX and UNIX-based servers. He previously worked for Gateway Computers, where he experienced the fast-paced environment of a company growing at a monthly rate approaching 100 percent. Mr. Irwin has also worked as an associate member of the professional staff at The Johns Hopkins University Applied Physics Laboratory in Laurel, Maryland, where he tested infrared seekers for the U.S. Navy’s ballistic missile defense program.

Mr. Irwin, a certified project management professional, holds a Bachelor of Science in Electrical Engineering and a Master of Science in Management with a specialization in Project Management from Colorado Technical University in Colorado Springs, Colorado.

CHAPTER 1

Understanding the
Project Environment

To understand the unique challenges inherent in project management, we must first understand the environment in which it takes place. This opening chapter reviews the characteristics of the project management environment and examines some of the challenges it presents. It also introduces some of the complexities related to managing projects in a global business environment.

The Art and Science of Project Management

The PMBOK® Guide defines three distinct characteristics of a project. ¹ First, a project is temporary. In contrast to an ongoing operation, a project has a distinct beginning and a distinct end. Second, a project is unique. Its purpose is to create a product, service, or other specific result. Finally, because it is temporary and unique, a project is progressively elaborated—or iteratively refined—until the solution reaches a sufficient level of definition or completeness.

An organization that attempts to undertake projects reaching across functional, cultural, and business boundaries should expect to encounter struggles and complexities. The deciding factor in a project’s success will be how the project manager responds to these challenges.

Crafting a project charter, assembling project schedules, analyzing variances to cost and schedule, and developing risk management plans are all part of the science of project management. Negotiating for project resources (financial and personnel), influencing key stakeholders, and leading the team—those are part of the art of project management. Art and science together define the skill of the successful project manager. Neither can exist without the other if there is to be a successful outcome.

Usually, it’s not the initiating, planning, executing, controlling, and closing—the science of project management—that causes migraines and heartburn for project managers; rather, it’s the need for constant communication, negotiation, political play, and influence. These skills must be applied in a multidirectional manner—downward to the project manager’s team, upward to the project sponsors, sideways to peers and colleagues, inward to themselves, and outward to external suppliers and partners. The project manager must also keep focused on corporate strategy (forward) and how his or her project fits into it, while simultaneously monitoring and controlling the performance and execution of the project (backward). Figure 1-1 illustrates this concept graphically.

Challenges in the Project Environment

The project environment offers many challenges for even the most experienced project manager. Four key challenges common to every project environment include: communication, competition for scarce resources, unclear project goals, and lack of power. In recent years, increasing project globalization has presented an additional challenge to project managers around the world.

Communication

Project managers could just as well be titled “project communicators” because they must keep all the project stakeholders engaged and informed during the entire project lifecycle. As a project manager, you can expect to spend up to 90 percent of your time communicating with stakeholders—sponsors, team members, resource managers, vendors, and partners, to name just a few. (In Chapter 4 we’ll take a closer look at stakeholders and their specific interests and influences.)

What makes project communication so challenging? First, not all stakeholders need the same information. Second, not all stakeholders need, or want, the communication to be in the same medium (e.g., email, phone, meetings, presentations). The message will also differ with the type of information being communicated (e.g., status reports, schedule changes, scope changes, meeting minutes), as well as the frequency of those communications.

Competition for Scarce Resources

Competition for valuable and scarce resources is another challenge for the project manager. Effectively dealing with this challenge requires that you understand the technical skills critical to each task within your project and that you effectively negotiate with resource managers to have the appropriate person(s) assigned to those tasks.

In many industries, especially in information technology (IT), portfolio management is becoming a popular way to deal with these issues. Portfolio management enables an organization to apply its resources across the board to all of its programs and projects in ways that optimize their use.

Political savvy is very important to project managers working in a portfolio management environment. Consider the project manager working on one of the low-priority projects in the portfolio. He or she may continuously struggle to keep resources as the needs of high-priority projects shift.

Unclear Project Goals

If you do not know where you are going, you will not know when you get there. Many projects are challenged from the beginning because the sponsor has not provided clear objectives and well-defined goals. What does success look like to the project’s sponsor, its customer, and members of your project team? What are the goals of the project?

The Project Management Institute’s PMBOK® Guide describes projects as temporary and unique. ³ That means there must be a specific reason for the project and there must be a distinct beginning and end to the work. But in many instances, the project manager will be handed a project without a clear definition of its scope, even though the project schedule and budget have both been set. Virtually every project manager can identify with the scenario of having a mandated budget and schedule. How can you possibly manage to a dictated schedule and budget without a solid definition of the project’s ultimate goal?

By working to define the goals of the project, you can help the project sponsor define the project’s scope and outcome. Keep in mind that as the project manager, your job is to communicate the work that can be done within the bounds of the directed schedule and budget. If you do not, you’ve essentially accepted the task as directed and have set your project up for failure prior to kickoff. In today’s business environment, cost and schedule are paramount for corporate executives. As companies strive to beat the competition to market, deadlines for development and testing are shrinking and budgets are being cut to increase profit margins.

It’s easy to see why a project manager must have well-honed interpersonal skills. It’s not easy—without jeopardizing your career—to communicate the impacts of unrealistic project schedules and budgets to corporate executives, who are in turn under immense pressure from shareholders and corporate boards. To be successful, the project manager must understand the political environment of the organization and how to communicate effectively at all of its levels.

Lack of Power

In many organizations, the project manager operates without formal positional power over project team members. Team members may be connected to a project manager on paper, but still report to a functional manager who is responsible for their performance reviews and raises. This creates a situation that can easily lead to conflict and struggle. The project manager is placed in a position of assigning project tasks to team members who do not report to him or her.

Figure 1-2 provides a summary of the three major types of organizational structures. Refer to Appendix A for a detailed discussion of each organizational structure, including the advantages and disadvantages of each.

If departmental goals are in conflict with the project, a team member’s priority may be to align with the situation of the moment, which may not be that of the project. For example, consider a matrix organization in which team members report to a functional manager but are assigned to projects individually. These team members may have goals that are aligned with their functional manager’s goals instead of their project manager’s goals.

Alternatively, consider a projectized organization, in which the team member is assigned to, and reports to, the project manager full-time. The goals of the team member will most definitely map to the project’s goals. Formal power is much more apparent in the projectized structure than it is in the matrix structure.

The project manager must be in constant communication with resource managers to understand where their project falls on the priority scale, because resource managers assign personnel and other resources to their projects. If you sense your project is not a high priority on the resource manager’s list, consider this a risk to your project, proactively manage it, and make contingency plans. If appropriate, elevate the situation to the project sponsor for assistance and guidance.

Project Globalization

Spurred by new technology, corporate mergers and acquisitions, and international joint ventures, business is becoming more global in nature. The globalization of business is in turn leading to the globalization of project management. For the project manager, an international project adds another level of complexity on top of an already complex project environment and necessitates increased cultural and interpersonal awareness.

Project managers should consider several factors when undertaking a global project. The first requisite is to understand the culture of the country (or countries) in which your project is undertaken. This is of vital importance because, for example, courtesies extended in one culture may be viewed as insults in another. Effective project management—both domestically and internationally—of course requires that you not insult your partners, suppliers, customers, subcontractors, or sponsors. But the chance for a misstep is much greater when you’re dealing with stakeholders from other countries and cultures.

As an international project manager you may not have enough control, even with the backing of your corporate executives. This is especially true if you are leading a project that requires collaboration with other companies. Your organization may be tasked with leading the project as the prime contractor, but other contractors may hinder your success. This sort of problem can occur in domestic projects, of course, but it can be particularly difficult if you’re working with foreign companies.

You may also have to take into consideration local and international regulations and restrictions. Be sure to address them early on, in the project planning phase. Also plan to allocate additional schedule and budget management reserves to allow for unforeseen problems related to international regulatory requirements.

Logistical issues, like time zone differences, can also be problematic. I once worked on an international project that had the core team located in the U.S. midwest, a partner contractor on the west coast, other project team members in the United Kingdom, and the customer in Asia. Needless to say, many project meetings occurred during the midnight hour, causing fatigue and, in some instances, an attention-to-detail deficit.

Another logistical problem is dealing with differing currencies. This should be considered when performing budget variance analysis, discussing prices with the customer (exchange rates change daily), and estimating travel costs.

One final logistical item to be aware of is international holidays. Be sure to consider international holidays when planning your projects to avoid setting meetings during inappropriate times.

You should also understand the increased visibility of an international project to the outside world. Because they are usually greater in size and scope, international projects tend to draw more attention than domestic projects from stakeholders and occasionally, from external parties like political groups and press. Because of this increased interest, the price of failure may be magnified.

There are many other ways in which international projects increase the complexity of the project environment; approaching international projects just like another domestic project is a recipe for disaster. If the project manager works with team members without paying attention to cultural differences and other factors, the project has an increased chance for failure.

Another area of risk in an international project is lack of measurement during the project execution phase. While performance measurement is important on all projects, it’s critical to the health of a global project. The project manager must make measuring the project a priority. To give an analogy: If it’s possible to cover the distance of one mile on a domestic project before measuring baseline performance against the plan, you should move only 500 feet before assessing progress in an international project. Taking the pulse of an international project frequently is a necessity. Avoid the temptation to treat the project just like it’s a domestic one.

Lessons Learned

It is a good idea to gather lessons learned as projects—both domestic and international—progress. Every stage of a project’s lifecycle should include gathering lessons. Ask your project team to submit lessons learned during every phase of the project. This improves organizational memory of the lesson while it’s still fresh in everyone’s mind. On domestic projects you may be able to wait until the next phase, but on international projects the next phase may require the implementation of the lesson(s) learned and it may be too late to gather them after the fact.

KEY POINTS

   Proficiency in project management is a mixture of science (the hard skills such as budgeting and schedule development) and art (the soft skills such as political savvy, conflict management, and interpersonal influence).

   Project communication, especially the management of stakeholder expectations, is vitally important to the success of a project.

   The job of the project manager is often made more difficult by the lack of formal authority. Often, project team members do not report directly to the project manager, introducing a potential conflict of interest for a team member between project work and departmental work.

   The business world has seen scores of international company mergers, turning many projects into international endeavors. International projects require that the entire project team have an increased awareness of cultural differences among all stakeholders.

TAKE ACTION

   Begin building a relationship with your project sponsor by discussing the frequency of project communication you and your sponsor will require of each other. By doing so, you’ll communicate to your sponsor that you expect him or her to stay actively engaged with the project. This also provides you with an opportunity to build sponsor support through interpersonal rapport.

   Leverage the formal authority of the functional managers of each of your project team members. Meet with each team member and his or her manager. In the meeting, try to agree on the amount of time the team member will devote to your project. If you can, get the functional manager’s approval to provide input to the team member’s performance review. And if possible, leave with a written agreement between you, the team member, and the manager.

   Increase how frequently international projects are measured. Because it often takes an increased amount of time to implement corrective action on an international project, you’ll need early warning signs of impending problems.

Endnotes

1. Project Management Institute, A Guide to the Project Management Body of Knowledge, 3rd ed. (Newtown Square, PA: Project Management Institute, 2004).

2. Project Management Institute, The Standard for Portfolio Management (Newtown Square, PA: Project Management Institute, 2006).

3. Project Management Institute, A Guide to the Project Management Body of Knowledge, 3rd ed. (Newtown Square, PA: Project Management Institute, 2004).

4. Terri Morrison and Wayne A. Conway, Kiss, Bow, or Shake Hands, 2nd ed. (Avon, MA: Adams Media, 2006).