3. Situational Context Flashcards
Differences between Projects and BAU
Output - Project have a distinct output which must align to users needs. BAU generates benefits from the projects
Time period - Projects are temporary in nature and have a have a distinct start and finish, with plans to hand over to BAU which is established and ongoing.
Risk - Projects have higher risk due to unique nature, thus have contingency. BAU low risk as policies and procedures in place.
Teams - Projects temporary, unfamiliar with each other. BAU established with clear reporting lines.
Funding - Projects funded for a specific cost / benefit advantage, and known unknowns lead to contingency. BAU from annual budget, high forecasting accuracy.
Planning - All aspects of a project planned to ensure alignment, BAU is planned on a longer term basis on established plans.
Project management processes include;
- Starting process to identify the need and justification for project.
- A defining and planning process top detail what project will deliver.
- Monitoring and control process - against plan, forecasting
- Change control process
- Risk management process
- Learning and closing process.
A programme typically has:
Vision of an end state
May not have a well defined path at the start
Co-ordinated outputs delivery
Realises its benefits both during programme and following completion
Includes enabling projects
Longer in duration than a project
More strategic than a project
Programme management includes;
Co-ordinating projects
Managing interdependencies between project and BAU activities
Taking project outputs and managing change within BAU
Defining, quantifying, measuring and monitoring benefits.
Managing key stakeholders to enable proactive two way communication
Managing resources across th programme to prioritise projects
Managing processes such as risk and change requests.
When best to use programme management
Where strategic change is required - BAU and projects
Where evident a number of current projects contributing to same future change.
Where significant interdependencies
Where complimentary project share a common pool of resources.
Describe where using portfolio management may be appropriate
- Where numerous projects / programmes need to be co-ordinated.
- Resources - Where resources can be utilised better
- Improved delivery - through portfolio wide view of risk, dependencies and scheduling
- Risk - Of poorly performing projects continuing
- Change conditions - require constant review
What can happen where a portfolio is not managed well
- Initiation of project that do not fit portfolio
- Resources spread too thinly, can not achieve objective
- Outputs of poor quality from insufficient skills / resources
- Risk - Exposed to high risk as takes on too much
- Lack of cancelling un performing projects which absorb resources
Explain how PESTLE factors should be understood
Political - Government stability and policy. Ensure right decisions made in initiating and running them, green policy
Economic - Effect of money on a project. Understanding impact of economic crash on supplier ability to deliver and project funding makes better decision making and effective risk management.
Sociological - People and behaviour. Attitude to new technology. Community pressure. Need to assess such contextual factors.
Technological - How effected by emerging and available technology. Will tech be outdated by handover?
Legal - Effects of law. Can impact how delivered and outputs. ie health and safety legislation. Could get scope wrong and infringement of law.
Environmental - Wildlife and green issues, including noise, carbon footprint, re-use. Compliance to targets may add time and cost
VUCA
Volatility
Uncertainty
Complex
Ambiguity
Impact of legal and regulatory environment on projects
Working conditions Risk Management Governance Sustainability Environmental legislation Employment legislation Data protection Freedom of information
Explain three differences between projects and business as usual – 30 marks (10 marks each)
a)/1 Unique v ongoing
• Projects are unique and only happen once whereas business-as-usual (BAU) is repetitive and ongoing.
• Projects have unique time frames, unique stakeholders (e.g. users, sponsors and suppliers) and unique objectives while BAU has established durations, teams (e.g. operational teams) and targets (e.g. number of parts made).
• This means that the approach to successfully delivering projects need to be appropriate to their environment to achieve customer requirements while the management of BAU has been established and documented as part of a process with procedures that staff must follow to maintain quality.
a)/2 Products v benefits
• A project takes a need or idea and transforms it into a unique product/output which is then handed over to the users who use them in BAU.
• The project consumes resources (e.g. money) to do this and BAU takes the output and uses it to generate the benefits (e.g. sales/revenue) set out in the project business case.
• BAU uses a benefits realisation plan to embed and measure the benefits while a project uses a plan to show how the resources will be employed.
• An example is a project that delivers a new factory. The factory once completed is handed over to BAU/operations who use the factory to produce goods which generate revenue and profit for the organisation.
a)/3 Temporary v permanent
• A project has a temporary organisation which is formed at the start and disbanded after transition while BAU has stable organisations with roles that are more permanent and relationships that might have developed over considerable time.
• The project organisation comprises the board that provides direction, the project manager who is concerned with day to day management and the work package or work stream leads who are concerned with doing the work. The team must perform very quickly from the outset to ensure project objectives are achieved.
• They might not have worked together before and their roles and responsibilities must be defined and communicated and working relationships developed.
• BAU teams develop incrementally and often have regular team events to maintain motivation so that performance is maintained.
a) Explain three ways in which PESTLE can be used to assess a project’s context – 30 marks (10 marks each)
The PESTLE tool can be used as a set of prompts in a brainstorm/workshop.
• One of these prompts being the ‘P’ which focusses the team on the political factors affecting a project.
• This focus can include aspects such as government stability, government policy (both central and local) and spending on areas such as capital projects. It should also cover an analysis of internal organisational politics. • Having a good understanding of the political backdrop is important to understanding how decisions that have been made or are likely to be made could affect the initiating and execution of a project.
• For example, significant sums of money can be lost pursuing projects that require statutory approval but run counter to local or national policy such as building a nuclear power station especially when a change of government is a possibility.
a)2 PESTLE helps analyse the economic factors within a project’s environment.
• These concern the effects that money can have on a project and includes consideration of changes in the economic backdrop, economic confidence, inflation, interest rates, exchange rates and the availability of finance.
• For example, understanding what impact an economic crash would have on the project funding and suppliers’ ability to deliver. This is an essential part of understanding the project’s context.
• This would lead to informed decision-making and more effective risk management.
• For example, it may help a decision to look for an alternative source of funding or lowering the stakeholder’s expectations of a certain level of profit.
a)/3 Helps ensure that the legal factors that might influence a project are also analysed.
• This area covers the effects that the law can have on a project and trends in laws which impact on a firm’s operations and decision-making. These include: employment, health/ safety/ environment, antitrust, consumer protection, and governance laws.
• The impact of infringing existing laws or those ‘in the pipeline’ could be significant to a company’s reputation and revenues, with company directors facing possible legal action.
• The risk of this happening might only be realised through assessment of the legal component of PESTLE. • It might also uncover opportunities that the project could realise such as promoting a product that helps customers comply with legislation (e.g. safety related products).
Outline four reasons why a programme would be used to deliver strategic change as opposed to using a project – 20 marks (5 marks each)
b) /1 A programme structure would be chosen in instances where the delivery of change requires the coordination of a number of projects and business as usual (BAU) activities. The focus is on delivering change and benefits rather than a single project delivering a product.
b) /2 A programme would be used where a number of current or future projects are contributing towards a single vision of change. Putting all projects into a programme will ensure that what is delivered is done in the most efficient way, with a focus on delivering the programme’s vision as opposed to individual project objectives.
b) /3 Coordinating a number of projects within a programme structure ensures that projects do not ‘collide’ with each other and that change can be implemented in a staggered fashion, with benefits delivered incrementally over time. This helps to ensure that BAU staff are not overloaded and therefore improves the prospects of the realisation of benefits.
b) /4 A programme would be used where it may be possible to identify a programme vision or end goal, but not as easy to identify all of the work that will be required to get there (e.g. such as in the merger between two companies). Programme structures are designed to be more open to delivering change in chunks than projects and coping with ambiguity.
Explain three ways in which failure to comply with laws and regulations can impact on project delivery – 30 marks (10 marks each)
Compromised working conditions.
• Failure to comply with laws covering employee working conditions include areas such as discrimination, disability provisions, employment contracts, leave entitlement and working hours may mean that working conditions are compromised.
• This can lead to accidents and disputes reducing labour availability.
• In addition, poor morale will result in poor performance, high incidents of sickness leave and workforce turnover. This will lead to higher costs and delays.
• Also, this may lead to loss of reputation as information gets into the public domain and loss of business as customers refuse to do business with law breaking organisations.
a)/2 Cost of compliance/non-compliance
• Failure to comply with Health and Safety legislation can have a catastrophic effect on projects being safely delivered.
• At the most basic level, firms will need to provide personal protective equipment for employees and for them to wear it in specified areas, which will add additional cost.
• Failure to comply could lead to accidents or even fatalities. This will of course have a detrimental effect on project performance, increasing costs, introducing delays and reducing the confidence of senior staff in the project’s management team.
• In the case of accidents, a visit from the Health and Safety Executive (in the UK) will stop any work and may result in a lengthy enquiry and possible criminal charges. Projects may be cancelled as a result of this and the loss of business can lead to organisational failure.
a)/3 Stakeholder disengagement and fines
• Breaches of data protection regulations can lead to stakeholder disengagement as well as administrative fines by regulators.
• The level of fine will be determined by the nature, gravity and duration of the breach; the level of damage suffered by individuals; and any action taken by the organisation to mitigate the damage suffered by individuals.
• Regulatory authorities also have the ability to impose specific compliance requirements which could lead to additional costs and delays.
• In exceptional circumstances they may decide to ban an organisation from processing personal data, which could lead to the cancellation of a project.
• It can also lead to legal action where information regarding national security is not adequately controlled.
Explain two ways in which VUCA can be used to assess a project’s context – 20 marks (10 marks each)
To understand the level of ambiguity (‘A’ in VUCA) in a project.
• Ambiguity causes mixed messages, conflict of interests and the inability to understand a situation. The project faces unknown unknowns. It must therefore be assessed and quantified to minimise the level of risk in a project
• Relevant information is available but the overall meaning is still unknown. This therefore leads to poor decisions being made such a decision to proceed at a gate.
• Understanding cause and effect, generating hypotheses and testing them can increase an understanding of a project’s context.
• This will allow decisions to be made with confidence and with a greater chance of success.
b)/2 To understand the complexity (‘C’ in VUCA) of a project.
• Situations are often much more complex than initially understood. Examples include political alliances, personal relationships and system complexity. Not understanding this can result in over-simplification of situations and poor decisions being made.
• Breaking a complex problem down or presenting it in a new way can aid understanding. For example, mapping out the stakeholders and showing the relationships between them can help visualise the human context and understand how to positively influence them.
• Understanding them would be critical to project success and benefit realisation.
• One way of understanding complexity is to bring in additional expertise which can help the team understand situations so that suitable responses can be implemented.
