1960 '62 '64 '66 '68 '70 '72 '74 '76 '78 '80 '82 '84 FIGURE 2-2. Average project size capability for a construction company, 1960-1984.
The moral here is that not all industries need project management, and executives must determine whether there is an actual need before making a commitment. Several industries with simple tasks, whether in a static or a dynamic environment, do not need project management. Manufacturing industries with slowly changing technology do not need project management, unless of course they have a requirement for several special projects, such as capital equipment activities, that could interrupt the normal flow of work in the routine manufacturing operations. The slow growth rate and acceptance of project management were related to the fact that the limitations of project management were readily apparent, yet the advantages were not completely recognizable. Project management requires organizational restructuring. The question, of course, is "How much restructuring?" Executives have avoided the subject of project management for fear that "revolutionary" changes must be made in the organization. As will be seen in Chapter 3, project management can be achieved with little departure from the existing traditional structure.
Project management restructuring has permitted companies to:
• Accomplish tasks that could not be effectively handled by the traditional structure
• Accomplish onetime activities with minimum disruption of routine business
The second item implies that project management is a "temporary" management structure and, therefore, causes minimum organizational disruption. The major problems identified by those managers who endeavored to adapt to the new system all revolved around conflicts in authority and resources.
Three major problems were identified by Killian1:
• Project priorities and competition for talent may interrupt the stability of the organization and interfere with its long-range interests by upsetting the normal business of the functional organization.
• Long-range planning may suffer as the company gets more involved in meeting schedules and fulfilling the requirements of temporary projects.
• Shifting people from project to project may disrupt the training of new employees and specialists. This may hinder their growth and development within their fields of specialization.
Another major concern was that project management required upper-level managers to relinquish some of their authority through delegation to the middle managers. In several situations, middle managers soon occupied the power positions, even more so than upper-level managers.
Despite these limitations, there were several driving forces behind the project management approach. According to John Kenneth Galbraith, these forces stem from "the imperatives of technology." The six imperatives are2:
1. William P. Killian, "Project Management—Future Organizational Concepts," Marquette Business Review, Vol.
2. Excerpt from John Kenneth Galbraith, The New Industrial State, 3rd ed. Copyright © 1967, 1971, 1978, by John Kenneth Galbraith. Reprinted by permission of Houghton Mifflin Company. All rights reserved.
• The time span between project initiation and completion appears to be increasing.
• The capital committed to the project prior to the use of the end item appears to be increasing.
• As technology increases, the commitment of time and money appears to become inflexible.
• Technology requires more and more specialized manpower.
• The inevitable counterpart of specialization is organization.
• The above five "imperatives" identify the necessity for more effective planning, scheduling, and control.
As the driving forces overtook the restraining forces, project management began to mature. Executives began to realize that the approach was in the best interest of the company. Project management, if properly implemented, can make it easier for executives to overcome such internal and external obstacles as:
• Unstable economy
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What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.