The Relationship Between Project Management And Company Performance

Abstract: In this paper, we focus on the significance of project management and correlation between project management and the success of the organization.

Background: The problems in multi-project companies are inherently complex and need to be addressed systematically. Furthermore, there is a need for transparent communication and collaboration within the organization as well as with partnering organizations. One way to achieve this is through effective and efficient Project management

Objectives: The aim of this paper is to analyze impact of the implementation of a flexible project management approach that impacts the overall performance of an organization.

Method: We have conducted a case study in a company called Cisco, that has implemented the Agile project management approach.

Results: The findings imply the importance of having the precise project management structure in place to progress the company and achieve its financial and corporate goals.

Conclusions: The results of the study suggest that the use of Agile project management approach in support of multiple projects improves its strategies, customer satisfaction, operations, collaboration, vision, and the functioning of an organization when implemented in an open and highly motivated environment. Introduction: Technology is enabling innovation quickly. Changes in the workforce, employee models and customer expectations are constantly driving organizations. Hence, more and more organizations across the world are adopting project management to deliver more quickly and efficiently. In this paper, we’ll examine how project management implementation can empower organizations to handle potential changes and the opportunities they create. Project management comprises of the following components:

Resource Management: Resource management helps use a company's resources in the most efficient way possible. These resources can include tangible resources such as goods and equipment, financial resources, and workforce. Through resource management ensures that the project has enough physical resources, and that those resources are assigned to appropriate tasks. Maximizing the efficiency is the key driving strategy of resource management. To achieve this, the management must gain thorough insight of current projects, goals and objectives, and upcoming project work. It also involves tracking project progress. There are also an governing body that schedules resources to achieve transparency in the planning process. There are also project managers that help forecast resource availability. They also ensure that the organization gets the most out of the resources acquired to participate in projects.

Risk Management: Risk Management incorporates identification, analysis, assessment, and strategic mitigation of potential risks. For any organization risk management is a key component of successful project execution to ensure that there are proper disaster recovery and continuity of the business. This encompasses the entire life cycle of a project and must be accounted for at every phase so that the projects are aligned to their best interests. Proper risk management implies control of potential unforeseen challenges and is proactive rather than reactive.

Change Management: Change management is a systematic approach to dealing with a transition of an organization's projects, processes, and technologies. The purpose of this is to implement strategies for initiating, implementing, controlling and helping the company adapt to those changes. This strategy includes crafting a structured procedure for initiating a change, as well as structuring mechanisms appropriate for responding to change requests through their entire life cycle. This is possible through careful consideration of how an adjustment will affect processes, systems and employees. Change management begins with thoughtful planning, testing, communicating the change to impacted resources, scheduling and implementation, documenting and evaluation of the change. It is necessary that every change is documented for reference purposes and in case the change needs to be backtracked. It is also important to ensure that the change follows compliance.

Demand Management: Demand management enables organizations to bring new policies, interests, ideas, projects, and processes together while creating a portfolio. The objective of demand management is to ensure that the final outcome created through this process prioritizes a strategically aligned and impressive portfolio. The more this process captures the real strategic commitment of the organization and merges it with ongoing activities, the more it is a successful factor it is in building the right portfolio. It is a strategy that provides the projects and the organization the direction to adopt and practice only the most important set of activities aligned with the organization's objectives. Demand Management also includes assessment and control of current activities to identify gaps in processes, resource allocations, and projects.

Process improvement: Organizations continuously evaluate all aspects of their businesses to cut down costs, maximize output and enhance customer and employee engagement. Process improvement involves selecting the most appropriate tools and methods to achieve these goals. This is important to making necessary improvements and further adopting improvisation as a culture rather than just once. More recently, Systems Thinking approach has emerged proving to be very beneficial at making lasting improvements. Each organization must look for different approaches like this to improving efficiency and effectiveness that include: · Process based approaches to redesign and optimize processes

Efficiency review: Methods emphasizing efficient flows and reductions of operational bottlenecks· Six Sigma methods based on statistical techniques to minimize defects and wasteBesides these interests, process improvement also provides the organization with objective analysis of the policies, processes, behaviors and values.

The value of Project management: The delivery of business outcomes through establishing all the aforementioned components of project management is realized through the success of projects, and in essence that is the way that project management strategies drive organizational success. Recently, a survey conducted by McKinsey & Co. found that nearly 60 percent of senior executives said building a strong project management discipline is a top-three priority for their companies as they look to the future. Executives from various companies also discovered that adhering to project management methods applicable to different projects and strategies reduced risks, cut costs and improved success rates all of which are important to surviving the economic crisis. Compared to 2007, respondents of the survey reported: Investing more time in project planning and due diligence (40%)

Conducting more frequent project reviews to assess risks, milestones and overall value (37%) Measuring quantitative and qualitative project outcomes more frequently (38%) It is interesting that many executives also admitted that the economic crisis underscored their project management drawbacks and forced them to do better,” according to the report. Project management expertise and oversight has proven to be helping organizations across the world streamline their delivery processes, cut costs and mitigate risks. It is also reported that good project management discipline stopped them from spending money on projects that fail. Tighter budgets and fewer resources mean less investment for the innovative projects. When project failure rates decrease, organizations get the biggest benefits that can be used to improve their ability to remain competitive. Companies are also discovering that as their project management strategy matures, the business value derived from it also increases. To increase that value and ensure strategic alignment across the project portfolio, executives at many global organizations are creating formal project management offices (PMOs). The PMOs help define which project management methodology is suitable for various projects and apply the best suitable method that fits each project's goals and objectives. What works for one project may not work for another, and it is important to carefully study the requirements of each project to strategically manage it using the right methodologies.

One such methodology is Traditional or Waterfall project management that is most prevalent in the world. Traditional/Waterfall Methodology: The traditional methodology is a universal practice, which was introduced during the 1950’s. The ultimate goal of this method is to make sure that all the tasks are carried out in a predetermined orderly sequence. It comprises of a set of techniques and tools that are used to plan, estimate and control the project activities. These techniques help to reach the desired project results on time, within the budget levels and in accordance with the project specifications and expectations. Traditional project management is mainly intended to use for projects, where activities are completed in a systematic sequence and there are rarely any changes to the projects. The whole concept of traditional project management depends on predictable experience and tools. Each project that uses this methodology follow the same lifecycle that includes five stages. They are: initiating, planning, executing, controlling and closing.

Initiation: includes

• Establishing the final goal
• Project objectives are defined
• Listing all the possible risks, to begin with, the project

Planning: includes

• All the activities of the project are identified
• Estimate the activity duration and resources available
• Developing a documented plan

Execution: includes

• To execute the plan and determining the quality of the project
• Setting up team meetings to distribute the needed information
• Scheduling and documenting work packages

Monitoring and controlling: includes

• Controls the scope of the project cost and quality
• Establishing the project progress report
• Revising the plan and activities

Closing: includes

• Seeking client acceptance and to close out the contract
• Providing the final report
• Making recommendations and sharing the knowledge for future projects. Gantt chart is the most important technique in the traditional methodology introduced to give a simple overview of a project. It is one of the useful ways to present project tasks and activities on a timeline. Today, we use the Gantt chart mainly to track project schedules and make project management less stressful. This chart helps us to understand the links between each task more clearly, team members who work on this project will be on the same page. It helps to set a realistic time frame and high visibility. However, when working on a demanding project with hundreds of tasks, charts might become too complex.

Traditional Methodology in the 21st century:

• The processes became more complex and demanding and thus traditional project management no longer offers the best solutions to business problems. Due to the complex processes, the concept of this methodology has been changed and extended through many different project methodologies and frameworks. However, these are failing to deliver successful projects, as the modern day projects demand so much more on a day to day basis that is hard to adapt to when this methodology is followed. Some of those drawbacks are:
• Change in project scope can seriously impact time/cost/quality.
• Change in business requirements by the clients in the middle of the project cannot be incorporated.
• If tasks aren't done properly in each phase and essentially identified at a later stage, the entire project can be severely impacted and results in loss of the client.
• If the project has internal or external dependencies (key resource, external projects), delays can occur as the "plan" has already been written. These shortcomings can be avoided by following a dynamic approach, that is widely accepted in the present day industry as the most reliable and efficient form of project management methodology, called the Agile Project management.

Agile Project Management and Implementation: Agile technology is used as a project management approach in which short development sequences known as sprints are applied throughout the project plan stages to focus on constant enhancement in the creation of services or products. The agile project management platform comprises a people-centric and an iterative process became developed in which the project team executes the stages of the project in sprints or iterations.