Understanding project management begins with understanding the project environment. This environment is different from that of a traditional organizational environment.
This series looks at the ways in which managing projects differs from managing ongoing operations and shows how the discipline of project management has evolved to address the challenges that are unique to projects.
The Project Environment Requires Project Management
Why do we need a different discipline for managing projects? To answer this, we have to consider that the range of activities in any workplace can be broken down into two groups: projects and ongoing operations. To put it simply, projects are all the work that’s done one time, and ongoing operations represent the work we perform over and over.
By looking at each one separately, we’ll see how they present different management challenges depending on the project environment they are set in.
How a Project Is Defined
All projects have two essential characteristics:
- Every project has a beginning and an end. The date of the beginning may be somewhat fuzzy, as an idea evolves into a project, The end, however, must be clearly defined so that all project participants agree on what it means to be complete.
- Every project produces a unique product. The outcome could be tangible, such as a building or a software product, or it could be intangible, such as new hiring guidelines. Part of the recent interest in project management stems from the realization that firms that deliver services have plenty of projects and can manage them with the same tools that have been used successfully in companies that produce tangible goods.
Projects abound in every industry.
Here are a few examples, drawn from a variety of industries:
- Engineers redesign controls on an automobile dash- board.
- An advertising firm produces print and television ads to promote a new razor.
- A software company works on a new version of its word processing program.
- Hospital administrators restructure responsibilities for nurses in their maternity ward.
- Manufacturing engineers document their processes to gain ISO certification.
Notice that each of these projects is plowing new ground, and each will be over when it reaches the goal.
Projects are unique and temporary.
Notice also that some of these projects produce tangible products, such as new software or a redesigned dashboard, while others, such as the restructuring of responsibilities for nurses, are intangible.
Project results may be tangible or intangible.
Definition of Ongoing Operations
Ongoing operations have the opposite characteristics of projects in that they have no end and they produce similar, often identical, products. Ongoing operations are often the primary purpose of a firm or a department.
Let’s look at a few examples:
- An insurance company processes thousands of claims every day.
- Automobile plants produce thousands of cars; all are the same model and have a limited range of options.
- A bank teller serves over 100 customers daily, providing a few dozen specific services.
- Power companies operate hydroelectric dams, controlling the energy produced and the water flowing through, day after day for decades.
- Telephone companies maintain telecommunication networks.
Ongoing operations produce similar products and have no defined end.
Traditional management theory has focused almost exclusively on ongoing operations like the ones in the preceding list. Experts in accounting practices, process improvement strategies, inventory management, staffing, and human relations have all viewed the organization as an ongoing set of activities.
Today, however, these experts are beginning to focus on the techniques necessary to manage work that is temporary and unique.
