INTRODUCTION TO PROJECT MANAGEMENT:Broad Contents, Functions of Management

CONCEPTS, DEFINITIONS AND NATURE OF PROJECTS:Why Projects are initiated?, Project Participants >>

Project Management MGMT627

LESSON 01

INTRODUCTION TO PROJECT MANAGEMENT

Broad Contents

Management

Key management concepts

Functions of management

Comparison of 20th and 21st century organizations

1.1

What is Management?

Managing is an art of getting things done through and with people in formally organized

groups.

Management is the process of designing and maintaining an environment in which individuals,

working together in groups, efficiently accomplish selected aims towards any project. It is the

art of creating an environment in which people can perform as individuals and yet cooperate

towards the attainment of group goals.

1.1.1

Management as a Process:

According to this, management is the process of using organizational resources to

achieve the organization's goals through planning, organizing, leading, and

controlling. It is thus, a set of activities directed at an organization's resources with the

aim of achieving organizational goals in an efficient and effective manner.

1.1.2

Management as People:

This refers to a group of people who engage in "Process of Management".

1.2

Key Management Concepts:

Project Organization: It comprises of people working together and coordinating their

actions to achieve specific goals.

Goal: A desired future condition that the organization seeks to achieve.

Resource: An asset, competency, process, skill, or knowledge controlled by organization.

Various types of resources that an organization possesses are as follows:

o People

o Information

o Machinery

o Financial capital

o Raw Materials

A resource is strength, if it provides an organization with a competitive advantage. On the

contrary, a resource is a weakness; if it is something the organization does poorly or does not

have capacity to do. Organizational resources include: Human, Physical, Financial,

Technological, and Information.

1.3

Evolution of Management Concept in Modern Era:

a) Frederick Taylor Father of Scientific Management was a Mechanical Engineer. He

invented high speed steel cutting tools. He got the opportunity to know first hand problems

and attitudes of the workers. Based on these he identified that in order to improve the

quality of management, the major concern was to increase efficiency in production, lower

cost, raise profits through higher productivity, and also increase the pays/salaries of the

workforce.

Project Management MGMT627

His message of management was to give people their best opportunities to be productive,

and in turn reward workers for their individual productivity. This increase in labor

productivity is not possible without the following:

· Providing ample rewards

· Adequate trainings

· Continuous managerial support

Thus, Fredrick Taylor concluded that "low productivity in any project is matter of

ignorance on part of labor and management".

b) Henry L. Gantt stressed the importance of "developing understanding of systems both for

labor as well as management." He emphasized that in all problems of management, human

element is the most important one.

Gantt gave graphic methods of describing project plans in order to have better managerial

control. He highlighted the importance of time and cost in planning and controlling projects.

He made the famous Gantt chart which is the forerunner of PERT.

1.4

Key Aspects of the Management Process:

The key aspects of the Management Process can be explained with the help of the following

diagram:

Figure 1.1: Management Process Aspects

1.5

Functions of Management:

The process of management consists of four basic managerial functions. These are:

a) Planning:

Planning is the process of setting objectives in any project and then determining what

should be done to accomplish them. It is a capstone activity of management. Managers at

every level do planning. Planning activities determine an organization's objective and based

on these helps it in establishing appropriate strategies for achieving them. These strategies

provide the organization with the direction and serves to obtain a match between the

external environment and internal capabilities. The strategies are intended to achieve a

sustained competitive advantage over the competitors.

Project Management MGMT627

b) Organizing:

Organizing is the process of assigning tasks, allocating resources, and arranging coordinated

activities to implement plans. It involves establishing intentional structure of roles for

people to fill in organizations.

c) Leading:

Leading is the process of arousing enthusiasm and directing human resource efforts toward

project and organizational goals. It involves influencing people so that they contribute

towards organizational and group goals. Leadership predominantly is concerned with the

interpersonal aspect of managing.

In projects most important problems arise from people in terms of their desires, attitudes,

and behavior (as individuals as well as in groups). Thus, effective project managers also

need to be effective leaders.

Leadership implies follower-ship and people tend to follow those who offer means of

satisfying their own needs, wishes, and desires.

d) Controlling

Controlling is the process of measuring performance and taking actions to ensure desired

results in any project. It involves measuring and correcting individual as well as

organizational performance to ensure that events conform to plans.

Controlling facilitates accomplishment of plans. There are three basic elements that are

involved in controlling. These are:

1. Management should establish standards of performance.

2. Performance should be assessed periodically and information should be updated that

indicates deviation between actual versus the established standards.

3. Actions should be taken to correct performance that does not conform to the standards.

1.6

Management Functions: Planning, Organizing, Leading & Controlling:

Figure 1.2: Management Functions

Project Management MGMT627

1.7

Managerial Functions in Organizations Undertaking Projects:

Figure 1.3: Managerial Functions

Organizations are arranged in ways that try to maximize synergy, i.e. the ability of the whole to

equal more than the sum of its parts. This means that an organization ought to be able to

achieve its goals more effectively and efficiently than would be possible if the parts operated

separately. Organizations comprise of various levels. These are depicted in the following figure:

Figure 1.4: Various organizational levels

Figure 1.5: A model for organizational environment

Project Management MGMT627

Comparison of 20th And 21st Century Organizations:

1.8

20th Century Organizations

21st Century Organizations

Structure

· Bureaucratic

· Not bureaucratic, with fewer rules and

· Multi-leveled

employees

· Limited to fewer levels

· Organized with the expectation that senior

· Organized with the expectation that

management will manage

· Characterized by policies and procedures

management will lead, and lower-level

employees will manage.

that create many complicated internal

· Characterized by policies and procedures that

interdependencies

produce the minimal internal interdependence

needed to serve customers.

Systems

· Depend on few performance information

· Depend on many performance information

systems.

system, providing data on customers

· Distribute performance data to executives

especially

· Distribute performance data widely

only

· Offer management training and support

systems to many people

systems to senior people only

Culture

· Inwardly focused

· Externally oriented

· Centralized

· Empowering

· Slow to make decisions

· Quick to make decisions

· Political

· Open and candid

· Risk averse

· More risk tolerant

1.9

Economic And Social Forces Driving Need For Major Changes in Organizations:

This is illustrated in the following figure:

Figure 1.6: Economic and Social changes driving change

Project Management MGMT627

In order to have large scale changes in organizations, there are some distinctive transformation

processes. These are as follows:

· Reengineering

· Restructuring

· Quality programs

· Mergers and acquisitions

· Strategic changes

· Cultural changes

1.10

Paradigm Shifts:

From

Information Society

Industrial Society

High Tech/High Touch

Forced Technology

World Economy

National Economy

Long Term

Short Term

Decentralization

Centralization

Self-Help

Institutional Help

Participatory Democracy

Representative Democracy Hierarchies

South

North

Multiple Option

Either/OR

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