Use For Establishment Of Project Goals Aiming At Achievement Of Corporate Strategies

Establishment of project goals without control will endanger achievement of strategies. Objectives of projects greatly influence action guidelines and decision-making criteria for people concerned with projects, and policies of projects as well. Project goals developed from strategies serve to closely connect strategies with projects.

2. Evaluation System for Strategic Projects

Project base systems show the framework of new enterprise models needed by projectized enterprises that place projects as a core of corporate activities. Project base systems serve as a system to achieve corporate strategies effectively, and consist of project domain, process domain, organizational domain, financial domain, and knowledge domain. Each domain has a close relationship with and influence on the other domains.

Strategic Project Evaluation System

Strategic Project Evaluation System

Figure 4-1-4: Project Base System

• Project Domain

Projects have temporariness and originality as features, and they are regarded as unique. Projects in enterprises have similarity and relevancy, and utilization of such features will directly lead to enhancement of corporate competitive power. For example, development projects in the automobile industry focus on deliverables of projects and aim at efficiency improvement by greatly reducing the size of projects through the maximum use of similarity and relevancy. A typical example of such utilization of project features is the trend of strategic sharing of parts, which greatly cuts man-hours for projects, ensures the quality of shared parts and increases their reliability, making a strong contribution to enhancement of corporate competitive power.

The project domain provides frameworks for efficient achievement of corporate strategies by focusing on interrelationship of projects. The project domain consists of programs as activity with a long-term purpose, projects as activity to produce specific deliverables, and tasks that allow clear definition of work.

A program is long-term activity to achieve strategies and includes multiple projects. Correct recognition and definition of programs enables effective yield of profits, which would never have been generated if individual projects were operated without interrelationship with each other.

The field of programs is extensive and includes start-up of new business; Business Process Re-engineering (BPR), i.e., an activity to remarkably improve productivity of enterprises; and management of business. However, if a project with a clear objective and scope is divided into multiple sub projects for implementation and management, such projects should not be defined as a program. This is because scopes of programs are hard to be define and objectives of programs are not clear.

Attention has to be paid to how to define the scope of programs. A narrow definition generates multiple programs and causes a problem on interface between programs. In addition, individual programs'

capacities will be limited and measures for achieving strategies are likely to be restricted. Meanwhile, a broad definition will cause a difficulty in controlling programs and may take a great deal of effort and time to achieve effect.

In order to reduce interfaces between programs for easier control thereof, a group of projects that share any of the following items is often defined as the same program.

• Projects that have a common object

• Projects that are likely to share resources or skill types

• Projects that use similar technologies

• Projects that have similar markets or products

• Projects that have the same contractor

The following are examples of programs:

• Shorten the product development period from currently 3 years to 1.5 year through operational innovation.

• Achieve the sales of ¥20 billion within 5 years by releasing multiple new products in target business fields

• Raise the share in the present market to 30% within 3 years by developing a new business model.

The true value of program management rests in how to yield maximum results (profits) from business resources (investment) of enterprises by controlling and managing project activities from the managerial viewpoint. Absence of the viewpoint of program management will result in disordered acceptance (generation) of projects and aimless consumption of business resources, which causes difficulty in achieving corporate goals. Therefore, for organizations holding multiple projects, recognition of program management and its definition are essential to generate maximum results. In implementation of program management, the following matters should be defined.

• Selection of projects

• Determination of the order of priorities among projects

• Coordination between projects

• Integration between projects

Projects in this section can be defined as activities to produce specified results that are closely related to programs. Projects should be selected in light of program objectives. Details of the results to be achieved by projects may be identified in some cases through breakdown of program goals, while some of the details are generated from external requirements and are identified after being checked to see if they are consistent with project objectives. Projects can be defined as a component of a program and its relationship with other projects should be specified. Especially, the following items should be confirmed:

• Deliverables shared

• Resources shared (manpower, materials, equipment, and cooperation companies, etc.)

• Information shared

• Technologies shared

• Projects related

• Order of priorities of projects

Tasks are broken down and defined by Work Breakdown Structure (WBS). The greatest objective for project domains lies in how to rationalize tasks on a company-wide basis. Therefore, tasks should not be handled individually but as groups from the following viewpoints:

• Is it possible to eliminate tasks?

• Is it possible to achieve commonality of tasks and integrate them?

• Is it possible to standardize tasks?

Tasks are defined in the process of achieving project objectives, but the more tasks a project has, the greater volume of work is needed, and the more risks the project is exposed to. In project management, it is significant to achieve project objectives with as little amount of work as possible. This is because the reduction in workload will bring lower cost, quality improvement, and easier management, and result in contribution to enhancement of competitive power of enterprises.

Meanwhile, mere elimination of tasks causes difficulty in achievement of project objectives. For reducing tasks, reusing what were used in other projects and sharing tasks among multiple projects work effectively. However, tasks cannot be eliminated by chance. Elimination of tasks can be achieved through task sharing across the board. To achieve this, deliverables of projects and structures of work should be broken down and organized to enable systematic undertaking of tasks subject to commonality, sharing and reuse.

This concept can be applied to a single project and reduction and sharing of tasks will result. If tasks that repeatedly occur in a project and deliverables that allow sharing are identified and their reuse becomes possible through some preparatory work then work that would otherwise repeatedly occur will be reduced and efficiency as well as quality will be improved. Recognition of commonality among tasks, and fruitful response to this characteristic, will greatly contribute to the efficiency of projects.

A project has both tasks that should be standardized and tasks that should not, and these two types of tasks should not be handled in the same manner. Tasks to be standardized are those expected to improve in quality or productivity through standardization and rationalization. Tasks that should not be standardized refer to those whose rationalization costs surpass the effect of rationalization, or which need special approaches or ingenuity and greatly contribute to differentiation of projects.

Since enterprises generally do business in a particular industry, they usually practice many similar projects. In such cases, even if details of deliverables are different, there are many tasks that can be standardized. Standardized tasks can be considered highly matured tasks where experiences of past projects are utilized. Therefore, creation of standard tasks on a company-wide basis can result in remarkable improvement in the quality of project deliverables. In standardized tasks, details and work to be done are standardized and quality level can be measured, which works effectively in enhancing communications. In addition, standardized tasks can be easily subjected to comparison, and it provides effective information for task rationalization to compare actual results of similar tasks among projects.

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