暨南大学项目管理chapter2organizationstrategyandprojectselction

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1、 管理学院 School of Management 佟瑞 Edward Tong，MPM，MBA2023-1-271Edward Tong2014 copy reserved Jinan UniversityChapter 2 Organization strategy and project selection2023-1-272Edward Tong2014 copy reserved Jinan UniversityWhere We Are Now2023-1-27Edward Tong2014 copy reserved Jinan University3Strategy and p

2、rojects Strategy is implemented through projects,Every project should have a clear link to the organizations strategy.2023-1-27Edward Tong2014 copy reserved Jinan University4A lot of funds,so many projects,but how to link to Alibabas strategyStrategy,projects,and products or servicesOrganizations us

3、e projects to convert strategy into new products,services,and processes needed for success.2023-1-27Edward Tong2014 copy reserved Jinan University5Intels major strategy is one of differentiation,its projects target innovation and time to market.Projects and project management play the key role in su

4、pporting strategic goals.It is vital for project managers to think and act strategically.Why project managers need to understand strategyProject management is at the apex of strategy and operations.It is time to expand the traditional role of project manger from an operational to a more strategic pe

5、rspective.2023-1-27Edward Tong2014 copy reserved Jinan University6Why Project Managers Need to Understand the Strategic Management Process Changes in the organizations mission and strategy Project managers must respond to changes with appropriate decisions about future projects and adjustments to cu

6、rrent projects.Project managers who understand their organizations strategy can become effective advocates of projects aligned with the firms mission.2023-1-27Edward Tong2014 copy reserved Jinan University7Projects and Strategy Mistakes caused by not understanding the role of projects in accomplishi

7、ng strategy:Focusing on problems or solutions with low strategic priority.Focusing on the immediate customer rather than the whole market place and value chain.Overemphasizing technology that results in projects that pursue exotic technology that does not fit the strategy or customer need Trying to

8、solve customer issues with a product or service rather than focusing on the 20%with 80%of the value(Paretos Law).Engaging in a never-ending search for perfection only the project team really cares about.2023-1-27Edward Tong2014 copy reserved Jinan University8The Strategic Management Process:An Overv

9、iew Strategic Management Requires every project to be clearly linked to strategy.Provides theme and focus of firms future direction.Responding to changes in the external environmentenvironmental scanning Allocating scarce resources of the firm to improve its competitive positioninternal responses to

10、 new programs Requires strong links among mission,goals,objectives,strategy,and implementation.2023-1-27Edward Tong2014 copy reserved Jinan University9Strategic Management Process Activities1.Review and define the organizational mission.2.Set long-range goals and objectives.3.Analyze and formulate s

11、trategies to reach objectives.4.Implement strategies through projects2023-1-27Edward Tong2014 copy reserved Jinan University10Strategic Management ProcessFIGURE 2.12023-1-27Edward Tong2014 copy reserved Jinan University11Characteristics of ObjectivesEXHIBIT 2.1S Specific Be specific in targeting an

12、objectiveM Measurable Establish a measurable indicator(s)of progressA Assignable Make the objective assignable to one person for completionR Realistic State what can realistically be done with available resourcesT Time relatedState when the objective can be achieved,that is,duration2023-1-27Edward T

13、ong2014 copy reserved Jinan University12Scenario Planning:A Supplement to Traditional Strategic PlanningClarifying your core business and assessing drivers of change in the industry environmentDeveloping potential scenarios and assessing the impact of STEEP factorsDeveloping potential contingency st

14、rategies and best future strategic optionsIdentifying early indicators and establishing triggers for strategic action2023-1-27Edward Tong2014 copy reserved Jinan University13Project Portfolio Management Problems The Implementation Gap The lack of understanding and consensus on strategy among top man

15、agement and middle-level(functional)managers who independently implement the strategy.Organization Politics Project selection is based on the persuasiveness and power of people advocating the projects.Resource Conflicts and Multitasking Multiproject environment creates interdependency relationships

16、of shared resources which results in the starting,stopping,and restarting projects.2023-1-27Edward Tong2014 copy reserved Jinan University14Benefits of Project Portfolio Management Builds discipline into the project selection process.Links project selection to strategic metrics.Prioritizes project p

17、roposals across a common set of criteria,rather than on politics or emotion.Allocates resources to projects that align with strategic direction.Balances risk across all projects.Justifies killing projects that do not support strategy.Improves communication and supports agreement on project goals.EXH

18、IBIT 2.22023-1-27Edward Tong2014 copy reserved Jinan University15A Portfolio Management System Design of a project portfolio system:Classification of a project Selection criteria depending upon classification Sources of proposals Evaluating proposals Managing the portfolio of projects.2023-1-27Edwar

19、d Tong2014 copy reserved Jinan University16Portfolio of Projects by TypeFIGURE 2.22023-1-27Edward Tong2014 copy reserved Jinan University17A Portfolio Management System Selection Criteria Financial:payback,net present value(NPV),internal rate of return(IRR)Non-financial:projects of strategic importa

20、nce to the firm.Multi-Weighted Scoring Models Use several weighted selection criteria to evaluate project proposals.2023-1-27Edward Tong2014 copy reserved Jinan University18Financial Models The Payback Model Measures the time the project will take to recover the project investment.Uses more desirabl

21、e shorter paybacks.Emphasizes cash flows,a key factor in business.Limitations of Payback:Ignores the time value of money.Assumes cash inflows for the investment period(and not beyond).Does not consider profitability.2023-1-27Edward Tong2014 copy reserved Jinan University19Financial Models(contd)The

22、Net Present Value(NPV)model Uses managements minimum desired rate-of-return(discount rate)to compute the present value of all net cash inflows.Positive NPV:project meets minimum desired rate of return and is eligible for further consideration.Negative NPV:project is rejected.2023-1-27Edward Tong2014

23、 copy reserved Jinan University20Example Comparing Two Projects Using Payback MethodEXHIBIT 2.3a2023-1-27Edward Tong2014 copy reserved Jinan University21Example Comparing Two Projects Using Net Present Value MethodEXHIBIT 2.3b2023-1-27Edward Tong2014 copy reserved Jinan University22Nonfinancial Stra

24、tegic Criteria To capture larger market share To make it difficult for competitors to enter the market To develop an enabler product,which by its introduction will increase sales in more profitable products To develop core technology that will be used in next-generation products To reduce dependency

25、 on unreliable suppliers To prevent government intervention and regulation2023-1-27Edward Tong2014 copy reserved Jinan University23Multi-Criteria Selection Models Checklist Model Uses a list of questions to review potential projects and to determine their acceptance or rejection.Fails to answer the

26、relative importance or value of a potential project and doesnt to allow for comparison with other potential projects.Multi-Weighted Scoring Model Uses several weighted qualitative and/or quantitative selection criteria to evaluate project proposals.Allows for comparison of projects with other potent

27、ial projects2023-1-27Edward Tong2014 copy reserved Jinan University24Sample Selection Questions Used in PracticeEXHIBIT 2.4Topic Strategy/alignment Driver Success metrics Sponsorship Risk Risk Risk Benefits,value,ROI Benefits,value,ROI Objectives Question What specific strategy does this project ali

28、gn with?What business problem does the project solve?How will we measure success?Who is the project sponsor?What is the impact of not doing this project?What is the project risk to our organization?Where does the proposed project fit in our risk profile?What is the value of the project to this organ

29、ization?When will the project show results?What are the project objectives?2023-1-27Edward Tong2014 copy reserved Jinan University25Sample Selection Questions Used in PracticeEXHIBIT 2.4 contdTopic Organization culture Resources Approach Schedule Schedule Training/resources Finance/portfolio Portfol

30、io Portfolio Technology Question Is our organization culture right for this type of project?Will internal resources be available for this project?Will we build or buy?How long will this project take?Is the time line realistic?Will staff training be required?What is the estimated cost of the project?

31、Is this a new initiative or part of an existing initiative?How does this project interact with current projects?Is the technology available or new?2023-1-27Edward Tong2014 copy reserved Jinan University26Project Screening MatrixFIGURE 2.32023-1-27Edward Tong2014 copy reserved Jinan University27Apply

32、ing a Selection Model Project Classification Deciding how well a strategic or operations project fits the organizations strategy.Selecting a Model Applying a weighted scoring model to bring projects to closer with the organizations strategic goals.Reduces the number of wasteful projectsHelps identif

33、y proper goals for projectsHelps everyone involved understand how and why a project is selected2023-1-27Edward Tong2014 copy reserved Jinan University28Project Proposals Sources and Solicitation of Project Proposals Within the organization Request for proposal(RFP)from external sources(contractors a

34、nd vendors)Ranking Proposals and Selection of Projects Prioritizing requires discipline,accountability,responsibility,constraints,reduced flexibility,and loss of power.Managing the Portfolio Senior management input The priority team(project office)responsibilities2023-1-27Edward Tong2014 copy reserv

35、ed Jinan University29A Proposal Form for an Automatic vehicular tracking(AVL)PublicTransportation ProjectFIGURE 2.4A2023-1-27Edward Tong2014 copy reserved Jinan University30Risk Analysis for500-Acre Wind FarmFIGURE 2.4B2023-1-27Edward Tong2014 copy reserved Jinan University31Managing the Portfolio S

36、enior Management Input Provide guidance in selecting criteria that are aligned with the organizations goals Decide how to balance available resources among current projects The Priority Team Responsibilities Publish the priority of every project Ensure that the project selection process is open and

37、free of power politics.Reassess the organizations goals and priorities Evaluate the progress of current projects2023-1-27Edward Tong2014 copy reserved Jinan University32Project Screening ProcessFIGURE 2.52023-1-27Edward Tong2014 copy reserved Jinan University33Priority AnalysisFIGURE 2.62023-1-27Edw

38、ard Tong2014 copy reserved Jinan University34Project Portfolio MatrixFIGURE 2.72023-1-27Edward Tong2014 copy reserved Jinan University35Project Portfolio Matrix Dimensions Bread-and-butter Projects Involve evolutionary improvements to current products and services.Pearls Represent revolutionary comm

39、ercial opportunities using proven technical advances.Oysters Involve technological breakthroughs with high commercial payoffs.White Elephants Showed promise at one time but are no longer viable.2023-1-27Edward Tong2014 copy reserved Jinan University36Key TermsImplementation gapNet present valueOrgan

40、izational politicsPaybackPriority systemPriority teamProject portfolioProject screening matrixProject sponsorSacred cowStrategic management process2023-1-27Edward Tong2014 copy reserved Jinan University372023-1-27Edward Tong2014 copy reserved Jinan University381Which of the follow is not one of the

41、commonly heard comments of project managers?dA.Where did this project come from?B.Why are we doing this project?C.How can all these projects be first priority?D.Why is this project so strongly linked to the strategic plan?E.Where are we going to get the resources to do this project?2023-1-27Edward T

42、ong2014 copy reserved Jinan University392 Strategy considered to be under purview of senior management is aA.Old school thinkingB.A new school of management thoughtC.Necessary in a company structureD.Beneficial to the Project ManagerE.Depended on company goals2023-1-27Edward Tong2014 copy reserved J

43、inan University40 3A critical factor to ensure the success of integrating the strategic plan with projects lies in a process that aA.Is open and published for all participants to reviewB.Starts with top managements directivesC.With projects first and integrates them with the strategic planD.Both B a

44、nd C are correctE.A,B,and C are all correct2023-1-27Edward Tong2014 copy reserved Jinan University414The intended outcome of strategy/projects integration is eA.Clear organization focusB.Best use of scare organization resourcesC.Improved communication across projects and departmentsD.Both A and C ar

45、e correctE.A,B,and C are all correct52023-1-27Edward Tong2014 copy reserved Jinan University42 Which of the following is a main reason why project managers need to understand their organizations mission and strategy?dA.They can better focus on the immediate customerB.They can make appropriate decisi

46、ons and adjustmentsC.So they can be effective project advocatesD.Both B and C are correctE.A,B,and C are all correct62023-1-27Edward Tong2014 copy reserved Jinan University43 Project managers who do not understand the role that their project plays in accomplishing the organizations strategy tend to

47、make all the following mistakes except:eA.Focusing on low priority problemsB.Overemphasizing technology as an end in and of itselfC.Focusing on the immediate customerD.Trying to solve every customer issueE.All the above are likely mistakes72023-1-27Edward Tong2014 copy reserved Jinan University44 In

48、 todays business environment,project managers find it valuable to have a keen understanding of dA.Strategic managementB.Technical issuesC.Project selection processD.Both A and C are correctE.A,B,and C are all correct82023-1-27Edward Tong2014 copy reserved Jinan University45 The textbook indicated th

49、at _ is the major dimension of strategic management.dA.Responding to changes in the external marketB.Allocating scarce resources of the organizationC.Beating competition to the marketD.Both a and b are correctE.Both a and c are correct92023-1-27Edward Tong2014 copy reserved Jinan University46Which o

50、f the following is not true for strategic management?aA.It should be done once each year just before developing the operating planB.It supports consistency of action at every level of the organizationC.It develops an integrated and coordinated long-term plan of actionD.It positions the firm to meet

51、the needs of its customersE.All of these are true statements102023-1-27Edward Tong2014 copy reserved Jinan University47Which of the following is the correct order for the strategic management process?cA.Strategies,mission,goals,projectsB.Goals,projects,mission,strategiesC.Mission,goals,strategies,pr

52、ojectsD.Goals,mission,strategies,projectsE.Projects,mission,strategies,goals112023-1-27Edward Tong2014 copy reserved Jinan University48Which of the following questions does the organizations mission statement answer?dA.What are our long-term strategies?B.What are our long-term goals and objectives?C

53、.How do we operate in the existing environment?D.What do we want to become?E.All of these are answered by the mission statement122023-1-27Edward Tong2014 copy reserved Jinan University49 Which of the following is not one of the traditional components found in mission statements?bA.Major products and

54、 servicesB.ProfitabilityC.Target customers and marketsD.Geographic domainE.Contribution to society132023-1-27Edward Tong2014 copy reserved Jinan University50Which of the following is not one of the characteristics of effective objectives?cA.RealisticB.AssignableC.FlexibleD.SpecificE.Measurable142023

55、-1-27Edward Tong2014 copy reserved Jinan University51Strategy formulation includes which of the following activities?dA.Determining alternativesB.Creating profitability targetsC.Evaluating alternativesD.Both a and c are correctE.A,B,and C are all correct152023-1-27Edward Tong2014 copy reserved Jinan

56、 University52 The assessment of the external and internal environments is called _ analysis.aA.SWOT analysisB.CompetitiveC.IndustryD.MarketE.Strategic162023-1-27Edward Tong2014 copy reserved Jinan University53Which of the following would not be classified as an organizational threat?cA.Slowing of th

57、e economyB.A maturing life cycleC.Poor product qualityD.Government regulationsE.All of these are organizational threats172023-1-27Edward Tong2014 copy reserved Jinan University54Which of the following would not be classified as an organizational opportunity?bA.Increasing product demandB.Excellent em

58、ployeesC.Emerging marketsD.demographicsE.All of these are organizational opportunities182023-1-27Edward Tong2014 copy reserved Jinan University55Which of the following is not one of the requirements for successful implementation of strategies through projects?eA.Allocation of resourcesB.Prioritizing

59、 of projectsC.Motivation of project contributorsD.Adequate planning and control systemsE.All of these are requirements192023-1-27Edward Tong2014 copy reserved Jinan University56Which of the following terms is often used to denote a project that a powerful,high-ranking official is advocating?aA.Sacre

60、d cowB.Pet projectC.Political necessityD.Special undertakingE.Strategic ploy202023-1-27Edward Tong2014 copy reserved Jinan University57Susies department is implementing many projects.She finds herself starting and stopping work on one task to go and work on another task,and then return to the work o

61、n the original task.Susie is experiencing dA.Poor schedulingB.Excess work burdenC.Flexible taskingD.MultitaskingE.Burnout212023-1-27Edward Tong2014 copy reserved Jinan University58 Project selection criteria are typically classified as:aA.Financial and non-financialB.Short-term and long-termC.Strate

62、gic and tacticalD.Required and optionalE.Cost and schedule222023-1-27Edward Tong2014 copy reserved Jinan University59 Which of the following financial models are typically included in project selection?d A.PaybackB.Net present valueC.Internal rate of returnD.Both A and B are correctE.A,B,and C are a

63、ll correct232023-1-27Edward Tong2014 copy reserved Jinan University60Projects are usually classified into all but one of the following categories.Which one is not one of the typical classifications?dA.Compliance and emergencyB.OperationalC.StrategicD.Political necessityE.All of these are typical cla

64、ssifications242023-1-27Edward Tong2014 copy reserved Jinan University61Which of the following is not one of the classifications for assessing a project portfolio?aA.Sacred cowB.Bread-and-butterC.PearlsD.OystersE.White elephants252023-1-27Edward Tong2014 copy reserved Jinan University62A project scre

65、ening matrix typically contains all of the following except:dA.The list of available projectsB.Specific criteriaC.Weights assigned to specific criteriaD.Costs to complete each projectE.All of the above are typically contained262023-1-27Edward Tong2014 copy reserved Jinan University63Which of the fol

66、lowing is the reason(s)why project managers need to understand their organizations mission and strategy?dA.To make appropriate decisions and adjustmentsB.To be effective project advocatesC.To be able to get their job doneD.Both A and B are correctE.A,B,and C are all correct272023-1-27Edward Tong2014 copy reserved Jinan University64In the Snapshot from Practice,Intels CEO has concentrated Intels strategy toward?aA.Creating chips to support the digital device marketB.Eliminating AMD as a competito