Study Overview

This study is based on research conducted during the first half of 1997 at a US-based high-tech company. The company is headquartered in the US, maintains overseas offices in 14 countries, and operates in 48 countries throughout the world. It has 900 employees. It is a highly localized company with most overseas offices run by local staff. The purpose of this study was to compare mental distance between employees working in the headquarters and those working in the company's domestic regional...

The office design for global development of products applying the idea of KPM

In companies that develop products globally and concurrently, there are some cases where a program manager who supervises the whole project is posted and manages the program during scheme stage, and an area project manager is posted for each area once it reaches system stage, to manage synchronization of the developments. Because the investment amount for development is increasing and product lifecycles in the global market are becoming shorter compared with before, timely return of investment...

References

Annual reports of selected companies. Berger, S. et al. (2QQ6). How We Compete What Companies Around the World are Doing to Make It in Today's Global Economy , New York Currency Bookdata. Dertouzos, M. et al. (199Q). Made in America Regaining the Productive Edge, Cambridge, MA Harper perennial, The MIT Press. Hamm, S. (2QQ7). Bangalore Tiger How Indian Tech Upstart Wipro is Rewriting the Rules of Global Competition, The McGrawhill Corporation. Kinoshita, T. (2QQ5). Revitalizing Japanese economy...

Required Ideal Model of the Relationship between Companies

In this section, the ideal model is discussed to reconstruct the new or existing business, to build and evolve relationships with the players of 4C (Customer, Competitor, Company and Complementor) through the whole supply chain against the background of the modularization accompanying the evolution of information and communication technology. The evolution of information and communication technologies especially do not allow companies to remain in an existing business domain, requiring them to...

Projectbased finance in Japan

However, project-based finance in the manner of JBIC has not attained popularity as a general financing scheme. Private commercial banks in Japan continue to favor the corporate finance approach, which depends primarily on Borrowers' assets. It is said that such financial practices contributed to the cumulative amounts of non-performing debts during the Bubble economy. In reviewing the treatment of non-performing debts after the collapse of the Bubble, the necessity of separating financing for...

PM applicationsin the engineering industry

The Japanese engineering industry recorded 11 billion ( 12.7 trillion) of backlog in 2007. The domestic market shares 76.7 , while the remaining 23.3 is covered by the overseas market. Despite the global energy boom, the market for the engineering industry has matured and the firms are looking at the business domain. To grasp applications in the industry, it may be necessary to bear in mind the sharing of capital system. A chemical plant is ranked higher in a share of 18.5 to meet a renovation...

Personnel Evaluation System

The project management system does not function merely by constructing an organization with such supporting function as PMO. There are companies that make projects function by adopting a personnel evaluation system that puts emphasis on project manager evaluating project members. In the case of KPM in which reporting is made directly to top management, project members are motivated to work for the project simply by belonging to the project. However, in kaihatsu-style projects where a matrix...

Lasting efforts to reduce costs and risks

(a) Rationalization of labor cost or from fixed wage salary formula to elastic wage salary formula, and outsourcing of human resources. Due to the continued deflation, increased risk and uncertainty, the high growth of the sales amount was not easily expected. But for the need to keep an incentive for high employee morale for profit-making, labor contracts for most firms were amended from the conventional type of (wage salary base + seniority factor + annual inflation adjustment + bonus...

Measures to perform concurrent development at the stage of requirement phase

Project F was more difficult than other existing projects because it had a short delivery date furthermore, we pushed forward the project with the customer from its requirement phase. Its development scale was also large, but the customer demanded a development period of only 3.5 months at the time of ordering the project. When we extended the development period for one month on the last estimate at the contract, we were able to show the work items and productivity problem list which we...

Finance for overseas projects in Japan

For overseas projects in Japan, however, finance that depends on the value of the project instead of Sponsor credibility has been realized and implemented, although there are still many cases of funds procured by corporate financing. After World War II, the Japanese government supported its exporters through the Export Import Bank of Japan, a government financial institution established in 1950. The Export Import Bank of Japan, now the Japan Bank for International Cooperation (JBIC), grants the...

Finance for domestic projects

Why is finance for overseas projects used to illustrate changes in the knowledge required for Project Management In Japan, finance for projects has traditionally been the Corporate Finance approach. Finance opportunities are extended to Sponsors who are responsible for the funding this tendency has been strengthened in domestic projects. In this view, the function of Project Management is to ensure completion of a project on schedule and within the budget. Consequently, the management of...

Contemporary paradigm of Japanese project management

Orthodox-type PM thinkers have endeavored to formulate the knowledge framework for construction of a technical system, placing the contractor as the major player. Their paradigm may be explained in another way they have been concentrating on how to build a technical system surely and stably. Here, it is important to note again that the premise of job sharing by the thinkers is that a definite mission shall be given by the owner, while the contractor designs, constructs and delivers the system...

Cost measurement

2.2.1 Status quo of cost measurement Following on the advancement in downsizing or networking of information technology with an increasing number of end-users, not only the operations and maintenance costs of computers but also further costs concerned with outsourcing some services, the education and supporting for general users have became accruing in business. Management could not have measured or controlled such operation costs of IT because invisible costs are increased in addition to...

Conclusion

With commoditization of the IT technology, the profitability of the projects in the entrusted developments gets worse. The original major prime constructors take the plan to reduce cost by offshoring or lowering the amount of orders in domestic developments, and the customers hold down the volume of developments for non-routine tasks and manage various existing tools. Under such an environment, the developments which have short delivery dates, frequent changes of specifications and small scales...

Concluding Remarks Strong Leadership in Many Success Stories and PMKPM

We could conclude that all these efforts of Japanese firms have been more mission-oriented and that they have endeavored to realize total optimization by adopting a hybrid model, integrating their competitive corporate DNA with newly absorbed genuine profit-seeking methods derived from the SWM model. How was this possible while they experienced the lost decade In one word, they never slept efforts made in comprehensive partial 10 Dore (2006) argues in his book that most of the newly created...

Architecture Theory and Points for Reconsideration

In Japan, the management mind is gradually changing. Nonetheless, there are still industries that are very proud of maintaining their traditional mind. Most of the major firms in the above-mentioned heavy industry have a commonality in their large fixed capital investment. These companies have comprehensive high technologies in production, assembly and engineering that embody the world's preeminent integrated and approximation (suriawase) type architecture. And yet, they accept not being able...

The Various Roles and Functions of a New Project Management Office PMO in Applying the Idea of KPM

Similarly, in Europe and America, many PMOs have been introduced to projects for technical system introduction and research & development. However, in Japan, new management system innovations applying the idea of KPM are introduced. Thus, in Japan, PMOs have been assigned various roles and functions. Many types of roles and positioning for PMOs can be considered according to the background of the project system in each company. For example, PMOs can assume roles and functions assumed by PgMO...

The Effectiveness of the Knowledge Base of the Project Management Information

A project is defined as time-limited individual activities which have a specific mission at the beginning, not limited to only IT. Thus, it has been doubted whether the information of past projects saved as knowledge could be utilized from a point of individuality. In the case of the IT project with short delivery date, the delay found out after a half month can become the fatal problem. Projects which are driven by the hour need close plans and information sharing, but the project management...

Required level of knowledge of project management

Regarding the type of finance for projects, the focus has shifted from Corporate Finance, which depends on the credibility of a project's implementers (Sponsors), to Project Finance, which depends solely on the cash flow of a project. This tendency has already had an impact on the field of Project Management, as the required knowledge of Project Management has changed in accordance with the type of finance. This paper discusses how finance for projects impacted the knowledge of Project...

Project management applicationin ICT industry

ICT is an acronym for information and communication technology. Regardless of hardware and software, engineers in the industry have confidence in applying project management. The industry is growing rapidly and widely in Japan the size of the market is already four times bigger than the engineering industry over several decades. Likewise, the education and training are based on the orthodox PM paradigm (Yamamoto, 2006). Despite the enthusiasm, it is worth noting that the owner is unable to...

Importance of project management

In reviewing and monitoring the feasibility of the projects concerned, it is natural that the success of Project Management is a matter of keen interest for stakeholders, including financial institutions such as the JBIC. In accordance with changes in finance types indicative of the diversification of overseas projects in Japanese economic development, i.e., from export finance to economic cooperation finance, the role of Project Management should also be updated. In addition, the required...

Project management as a complex integrative field

The following discussion is mainly related to contextual issues and P2M KPM characteristics 1 and 2. We are surprised by the way the world (organizations, universities and professional bodies) sees project management as a set of methods, techniques and tools which interact with other fields (such as general management, information systems, engineering, etc.) and bring effective ( ) ways of solving problems from launching new satellites to new product development, and organizational change. This...

Development Type Project Management and Risk Issues Project risk hazard

In the late 1990s, Japanese projects in Asia encountered a financial bubble which caused risk hazards. The owner had to reschedule or divest the recovery of capital, while the contractor implemented the payment hedged by insurance or had to agree to the postponement of amortization to be paid for construction. The risk hazard is hardly handled to protect parties by the contract stipulation (Kinoshita and Urata, 2000 Ohara, 2000). Other types of trouble like the network system was reported in...

Modularization of supply chain

The viewpoint of the modularization discussed previously is about the architecture of the product echelon. If the interfaces between two or more parts which constitute one finished goods become standardized and modularized, the necessity to internalize many products in one organization decreases. Then, the organization tends to specialize for each moduled product. However, modularization of business architecture is advancing not only in the product echelon, but also in the whole supply chain...

Kaikaku Strategy linkage reform

Kaikaku or innovative reform is a popular and meaningful word in Japan, because it is being pursued in contemporary enterprises of political administration, industry and the company. In particular, project management may be converted to provide dual advantages in dealing with the unique undertaking of creative entrepreneurship and solid implementation of business managers if contrived in the new version. Kaikaku is congruent to the strategy context that enterprises have to create and to sustain...

Preface

In the 1990s, Japanese companies experienced a deflationary depression called the lost ten years. To survive the depression, they looked for solutions in the kaikaku (reforms) of business management, organizations and technology, while struggling to regain their global competitiveness. We have observed that the companies that utilized the intellectual property of the entire organization were more successful in their reforms than those who focused only on their technological abilities....

Introduction

Society in the 21st century is forming a network of intertwined information systems. Enterprises are trying to win clients not as a group or groups, but as a guest individually. They are also trying to differentiate themselves by services as well as products, which makes information systems increasingly important for enterprises. Although various development process models have been developed and carried out, only about 25 of information systems are successful. Business process modeling...

Basic operability

For basic operability, a program operation guide and process table (program road map) is created, and by carrying out simulations regarding reduction in progress due to changed circumstances or increases in restricting conditions, etc., taking into consideration the assumed conditions and postulations for the overall scenarios, a design that increases the potential for achieving the program is embraced. Before starting a project, the study manager (SM) uses a project management tool such as...

Three layers composition of Kaikaku

Represented, motivated and encouraged by Kaikaku, the versatile challenges of uniqueness have been nominally implemented in Japan. Though the word is widely used in a number of visions at enterprises, the context is not substantially articulated, and its assessment of outcome is varied as well. The comprehensive context is engraved in many ways, and so kaikaku differs in what it means to stakeholders. Some use it as radical innovation, while others use it as small innovation. Likewise, some...

The Function of Management Accounting in a Project Management

We try to discuss the function of management accounting concerned with project management. In this paper, we insist that a management accounting has a kind of linkage role between management strategy and operations management. This function has two sides. One of these functions is to translate management strategy into a concrete action or a series of actions if a management strategy is recognized as a kind of business concept. This entails the breakdown of a strategy into a series of actions,...

Causes of project failure or success

Many reports have been published about failed projects. The Japan Users' Association of Information Systems (JUAS) published a survey on trends in enterprise IT (JUAS, 2006), which pointed to unclear and incompletely defined requirements, and organizations with inadequate staff and members. The Union of Japanese Scientists and Engineers (JUSE) published a survey on project success (JUSE, 2005), which pointed out project member motivation as vital to a project's success. The report stated that...

Work breakdown structure

Work breakdown structure (WBS) has been widely recognized as necessary for project management. JUSE (2004) says that the unit job size of a work package or task at the lowest layer should be somewhere between five to ten person-days, while O'Connell (2001) says that the unit job size should be somewhere between one to five person-days. The work package or task itself, however, is not necessarily defined in detail. Furthermore, in many cases, WBS is defined as the coexistence of software product...

Project management in projects funded by project finance

The knowledge of Project Management required for projects funded by Project Finance adds to the knowledge of the first and second stages to verify the possibility of financial independence of projects, which is maintained by structuring contracts among stakeholders and by risk management. JBIC performs due diligence for projects to secure a stable cash flow from projects. In such cases, Project Management should be required for due diligence only. Because Project Finance depends only on cash...

Devices for Kaihatsu development project organizations in Japan

The manufacturers that originally operated with functional model organizations have adopted a project management system as a promoter of the Fig. 1 Organization of kaikaku project Fig. 1 Organization of kaikaku project whole development, to more directly reflect market needs on new product development. In particular, automobile manufacturers, which develop new models concurrently, have adopted a matrix system called shukan or shusa (both mean in charge) system for products in which the shukan...

Project and program management process and implementation

NEDO's project management cycle includes R& D project evaluation and the reflection of evaluation results in future activities. The R& D project evaluation cycle includes a pre-project evaluation, an intermediate evaluation, a post-project evaluation, and follow-up monitoring and evaluation. Figure 5 shows the concept of NEDO's project management cycle. In an effort to achieve superior research results, NEDO undertakes the following R& D for the purpose of commercialization. If...

Organizational breakdown structure

Under both PMBOK and P2M, the organizational breakdown structure (OBS) generally relates the work package at the lowest layer to the unit organization. A Responsibility Assignment Matrix is used to define the OBS in more detail. The basic concept of the organizational structure in an engineering project differs greatly from that in an information systems project. Specifically, the organization of any engineering project is based on functional groups, as shown in Figure 1. A software project,...

An Example of a Project Management That Applied a Project Knowledge Base

As an example, I applied the knowledge base to a web development project and performed the project management. In this case, I used a development framework which the enterprise offered in multiple projects for the same customers and constructed different websites. Table 1 shows information of six projects including development periods, costs, the number of IWCP, development scales and the number of failures after operational tests. Projects A E were the projects undertaken from the basic design...

Abstract

This Part is intended to give an overview of the background and progress of the contemporary and the new project management, to arrive at KPM in Japan. Interpretations of its context and applications are versatile and changing. The paradigm shift from the orthodoxy to the contemporary and the new is essential in the evolution. The heritage of assets in the past is encompassed, engraved and arranged in higher grade. Readers will benefit by reading about the latest research outcomes and practical...

Evolution of information and communication technology and modularization

Various indications are made about the effects that the evolution of today's information and communication technologies have had on companies' competitive environments. They are as follows. First, it is the velocity of the change of the competitive environment. This comes from the velocity of evolution of information and communication technologies. Innovations have been made one after another, especially in the IT and associated industries further, various players have entered and various...

The Knowledge Base for the Visualization of Projects

In IT projects, there are more and more chances to visualize the responsibilities shared and work scopes, and the ordering sides also have more chances to confirm and approve them. WBS (Work Breakdown Structure) is often used to investigate all the work items in the development range. Both WBS and EVM (Earned Value Management system) methods are firmly established to manage large-scale IT projects. WBS is also included in the Guideline for Operation System Optimization settled by the Chief...

A case of openingtype project management and intellectual property

When considering a national innovation system for improving the competitive edge of a country, the role of the consortium cannot be disregarded. Industrial-government-academic consortiums and industry consortiums are taking charge of numerous projects initiated by national governments. For example, from a technical perspective, the main issue for semiconductor technology is assumed to be a decrease in the operating speed of LSI due to minimization, power consumption and manufacturing variance....

Kaikaku Efforts Brought Many Success Stories But Not in a Uniform

Japanese leading manufacturing engineering firms,3 among others, have endeavored to adjust to the dramatic socio-political changes at home and overseas, or more precisely, to increase or regain their competitive edge 3 Precisely speaking, engineering firms should not be classified as part of the manufacturing sector. They are based on highly qualified human resources and do not have factories. There are three firms that are exclusively engaged in engineering services, namely JGC Corporation,...

Project breakdown structure

Based on the above, the project breakdown structure could be formulated as Eq. (1) and applied to projects of both owner and contractor within the collaboration framework described above PBS F WBS, OBS(WBS), CBS(WBS, OBS(WBS), DPM, Ct) , (1) where PBS Project Breakdown Structure WBS Work Breakdown Structure OBS Organizational Breakdown Structure CBS Communication Breakdown Structure DPM Development Process Model Ct Contract Type (ex. Cost Plus Fee, Lump Sum, etc.). The development process model...

Project management standards

The value of project management has been recognized in the United States. PMI (Project Management Institute) had challenged in 1985 and published the monumental standards of PMBOK (A Guide to Project Management Body of Knowledge) (Duncan, 1996). The framework guides the project context and then covers the scope of nine knowledge areas for managing time, cost, quality, scope, procurement, human resources, risk, communication and integration. In 1996, the European professional organization of...

An epistemological perspective for project management

Here we address characteristic 3 and some aspects of characteristics 5 and 8. After Polanyi (1958), we propose an alternative epistemological perspective both to positivism and constructivism. Not separating personal judgment from scientific method, we argue that knowledge creation in project management should integrate classical scientific and symbolic (fuzzy) aspects. A reality can be explained according to a specific point of view and also can be considered as the symbol of higher order (Gu...

KPM the new Japanese Project Management

To overcome the issue, the new context symbolized by KPM (Kaikaku Project Management) has been launched, and its thinking and methodology are being applied. Most papers are written in either the contemporary or the new context or both, because they belong more or less to Kaikaku-type project management, which is further segmented to include areas of Kakusin (innovation), Kaihatsu (development), and Kaizen (improvement) solutions. KPM depicts the new knowledge framework improved from P2M by...

Three Generations of Project Management

We have already indicated that there are several definitions of project management. The transition in the definition of project management is explained by several researchers (Ohara, 2002 Shibao, 2003). According to their explanations of this transition, there are three generations of project management. The first generation of project management was from the 1940s to 1960s, and a typical example of such project management was a large-scale project management such as the Manhattan Project and...

Similarity and dissimilarity in the recovery of the US

It took a number of years before Japanese big firms became slim and recovered. Many small and medium-sized firms in the region have been left behind. It is not likely that many of them could restructure themselves to become competitive by assuming a hybrid management system under the global pressures and severe domestic economic situation and that the government, ruling parties and opposition parties could compromise in continuing policies to support many of them by fiscal measures, etc.,...

Trends in the Global Project Management Environment

Projects have been undertaken and managed since the beginning of civilization. However, it was only in the second half of the twentieth century that project management emerged as a distinct field of practice with its own tools, techniques and concepts (Stretton, 1994). Throughout the 1950s, project management developed primarily in the construction, engineering, defense and aerospace industries (Kerzner, 1979) and in the 1960s, the first major project management professional associations were...

Where Classical Project Management is No Longer the Answer Kaikaku Project Management and the Concept of Shikumizukuri

In the 1990s, Japanese companies experienced a deflationary depression called the lost ten years. To survive, and to regain their global competitiveness, they looked for solutions in the kaikaku (reforms) of business management, organizations and technology. The companies which utilized the intellectual property of the entire organization were more successful than those which focused only on technological abilities. These successful companies made efforts in the planning and execution of...

Some Theoretical Insights about PMKPM and Project Management

P2M KPM moves beyond the classical process and competence bodies of knowledge (BoKs) and standards proposed by the well-established professional bodies. Industries and professional bodies strive to create an integrated framework, which translates strategic aims into operational processes, thereby improving performance and creating sustained value. But these BoKs and standards are still mostly based on a positivist paradigm, using linear process views and classical operational research tools...

Project Management Qualifications

Although project management knowledge standards and guides, other than the ICB IPMA Competence Baseline, do not specify how they will be used as a basis for assessment and recognition of professional competence, the majority do provide an important resource for development of professional project management certification, registration or qualification programs. Only one of the performance-based competency standards, the Australian National Competency Standards for Project Management, has been...

KPM knowledge framework

The strategic capability of human resources is designed to be congruent with the organizational hierarchy and functions, because it is fostered by awareness of roles and learning by doing work in the organization. Though cross-functionality of teams has been emphasized in project management, the lateral phase of collaboration may be significant, with room for further practice. KPM intends to explore the framework of enhanced methodology of strategy implementation in the form of the hybrid of...

The orthodox contemporary and new categories of project management

This volume consists of six parts for the purpose of introducing the holistic outlook and the most recent papers in applications of project management. A certain guide is implied to readers in terms of what the orthodox, the contemporary, and the new contexts of project management are. The orthodox context is engineering-oriented under closed system thinking. The knowledge is mainly for contractors engaged in the artificial systems. The contemporary context is the value-driven project...

Establishing a Project Management Organization Matrix organization design and its issues

The idea of a matrix organization is introduced to a good number of companies that adopt a project management system. In a matrix organization, a functional division that performs ordinary operations is set up as part of a vertical line organization, while a division that carries out projects is set up as part of an ad hoc organization (horizontal line) crossing over an organization. A project manager with an independent responsibility runs this division. Here, one can see the intent to operate...

Challenges for PM

The P2M is a significant contribution to the field of project management and the first guide for project management, recognized by government, professional associations and industry, that directly addressed the issues of enterprise-level project management, taking a systemic view and clearly identifying the role of program and project management in strategy implementation and value creation. It appears that there is strong support for P2M at enterprise management level in leading Japanese...

An Introduction to Value Management

Here, we introduce value management for developing program management as explained above. What kind of value would we produce by projects We need a value-based evaluation phase with a strategy and mission management for a bundle of projects at the ex ante, in process and ex post of project management. 3 In Japan, Nissan had a number of strategic projects initiated by some CEOs before Karlos Goone took over. However, these projects did not succeed and were only achieved by Goone with a program...

Modeling to understand that is to do ingeniously

The discussion in this section is mainly related to characteristics 4, 5, 6, 7 and 8. Acting in complex, uncertain and ambiguous management situations involves Modeling to understand, which is to do ingeniously (Le Moigne, 2003). We introduce the theoretical roots of the design of a meta-model. Complexity and systemic perspective contend that acting and learning are inseparable. This involves having information (tacit, implicit or explicit), an understanding of the context, the different...

Contents

The Guide of Essential Terminology in KPM xvii Part l FRAMEWORK OF CONTEMPORARY JAPANESE PROJECT MANAGEMENT Framework of Contemporary Japanese Project Management (l) 5 Project Management Paradigm Interpretation, Application and Evolution to KPM Framework of Contemporary Japanese Project Management (2) 25 Kakusin-Innovation Program Management (IPM) Organizational Acceptance and Dynamic Intellectual Cycle Shigenobu Ohara Adjusting Function and Office Design in Japanese-Style 45 Project Management...