Week03 slides spring_2013
- 1. Mgt 610 Strategic Perspectives on Project Management Session 3 Project Manager’s Value Mindset Dr. Thomas Lechler Phone: (201) 216-8174 FAX: (201) 216-5385 email: tlechler@stevens.edu
- 2. Mgt 610 Strategic Perspectives on Project Management (c) 2013, Thomas Lechler. All rights reserved.For academic use only. 2 Session 3: Evidence 1. Success factors describe the constraints of the traditional project management paradigm, how could a new paradigm look like? 2. Project value differs from traditional project success. What are the consequences? 3. A framework for a project strategy will be developed to maximize project value.
- 3. Mgt 610 Strategic Perspectives on Project Management (c) 2013, Thomas Lechler. All rights reserved.For academic use only. 3 Module 3: Agenda Project Value Management Framework 1. Basics of Strategic Management 2. Project Value Perspectives 3. Project Value Network 4. Project Value Strategy 5. Project Value Statement
- 4. Mgt 610 Strategic Perspectives on Project Management Uncertainty Focused PM Perspective 1. Project uncertainty can be managed by seeking, discovering and exploiting project value opportunities during project implementation. 2. The project manager is instrumental in discovering and exploiting project value opportunities. 3. The project manager needs to have a project value mindset (PVM) to discover and exploit opportunities. For academic use only. (c) 2013, Thomas Lechler. All rights reserved. 4 Change Focus to Value
- 5. Mgt 610 Strategic Perspectives on Project Management Research Framework: Hypotheses For academic use only. (c) 2013, Thomas Lechler. All rights reserved. 5 Exploited Value Opportunities Project Value H 1 H 2 H 3 PM’s Project Value Mindset Project Value Mindset Study
- 6. Mgt 610 Strategic Perspectives on Project Management PM’s Value Mindset – Definition Project Manager’s Project Value Mindset .. is a mental state involving dispositions and traits resulting in activities to seek, discover and exploit opportunities beyond a pre-defined value proposition with the intent to maximize a project’s value. Project Value Opportunity .. represents a potential to exceed the pre-defined project value occurring during a project’s implementation. Project Value .. could be represented by a single or any combination of efficiency, technical effectiveness and the satisfaction of a project’s stakeholder. Project Value Mindset Study For academic use only. (c) 2013, Thomas Lechler. All rights reserved. 6 Research Framework: Definitions
- 7. Mgt 610 Strategic Perspectives on Project Management • 5 key informants per project: Project Manager, Project Sponsor, 3 key members of project team. • The U.S. sample includes responses from 387 core team members, 114 project managers and 95 senior managers. • Successful projects (104) unsuccessful projects (10). • New product development projects (20%), software development projects (28%), constructions projects 10%, and IT projects (31%) implemented in many industries. • All projects had a budget of at least $500,000 and their average duration is 18 months. For academic use only. (c) 2013, Thomas Lechler. All rights reserved. 7 Research Method: Sample Project Value Mindset Study
- 8. Mgt 610 Strategic Perspectives on Project Management PM Value Mindset – SEM Estimates Project Value Mindset Study Exploited Value Opportunities R2=.41 Project Value R2=.52 .63* (7.49) a .19 * (2.04) .59* (5.93) Strat_Rqmnt Spec_Rqmnt Traits Overachievement Ambiguity Opportunity Disp. .59* .59* .65* .60* .64* .77* PM Value Mindset Standardized Path Coefficients of the Structural Equation Model* t-Valuesa Fit Statistics RMSEA AGFI NNFI NFI CFI X 2 df 0.002 0.93 1.00 0.99 1.00 14.98 (p=.53) 16 For academic use only. (c) 2013, Thomas Lechler. All rights reserved. 8
- 9. Mgt 610 Strategic Perspectives on Project Management Conclusions • PM Value Mindset is important: • to manage uncertainty, • and capture project value. • Project value opportunities occur in situations of uncertainty. • Opportunities must be perceived and exploited to maximize project value. Project Value Mindset Study For academic use only. (c) 2013, Thomas Lechler. All rights reserved. 9
- 10. Mgt 610 Strategic Perspectives on Project Management • Technical opportunities are less frequent than expected! • Not every situation of uncertainty leads to opportunities! Nature of Opportunities Opportunity Category Opportunities Frequencies Technology Testing solution 3 Implementation process Monitoring, process improvement, outsourcing, versioning 8 Project & Business Multiplier, identified new opportunities of original solution 11 Future Business Project life cycle opportunity, beyond project 7 (c) 2013, Thomas Lechler. All rights reserved. 10For academic use only.
- 11. Mgt 610 Strategic Perspectives on Project Management • 4 cases identifying real opportunities and misperceiving opportunities • 2 cases having both exploited and unexploited opportunities • Identifying opportunities is not easy or natural! • Exploitation of more than two opportunities not observed! • Very few rejected opportunities! Opportunity Recognition & Exploitation Number of Opportunities per Project Frequencies Percentage One opportunity identified & exploited 15 36% Two opportunities identified & exploited 7 17% Opportunities identified but not exploited 2 5% No identified opportunity 4 10% Misperceived opportunities 20 48% (c) 2013, Thomas Lechler. All rights reserved. 11For academic use only.
- 12. Mgt 610 Strategic Perspectives on Project Management • Opportunities are mainly recognized by the project managers! Context of Opportunity Recognition Stakeholders Frequencies Board of directors 3 Project steering committee 1 Project sponsor 3 Project manager 15 (c) 2013, Thomas Lechler. All rights reserved. 12For academic use only.
- 13. Mgt 610 Strategic Perspectives on Project Management • Business perspective is key to opportunity perception and exploitation! • Constraint management is constrained to risks! Project Manager Type PM Types Uncertainty misperceived Opportunity misperceived Opportunity identified by PM Opportunity identified by others Technocrat (6) 0% 100% 0% 0% TC (24) 46% 58% 21% 21% Business (9) 33% 11% 78% 22% (c) 2013, Thomas Lechler. All rights reserved. 13For academic use only.
- 14. Mgt 610 Strategic Perspectives on Project Management Value Effects of Project Opportunity Frequencies Percentage Stakeholder Satisfaction 17 77% Shareholder Satisfaction 15 68% Financial Returns 13 59% Schedule 13 59% Quality (Performance) 12 55% Budget 11 50% Outcome (Specs) 10 46% Quality (Grade) 8 36% Non-financial Benefits 6 27% Other 4 18% (c) 2013, Thomas Lechler. All rights reserved. 14For academic use only.