Web-based project management--a solution for regionally disbursed teams

Introduction

Project Communication. Project communication is one of the most critical success factors for projects today. The economy in the 21st Century will be “knowledge based.” This means that project communication will even be more critical to the project management success in tomorrow’s world. Business Executives are already claiming that “Knowledge” or “qualified information” is more important than making money. As the technology advances, new opportunities are popping up by the minute to project managers to improve their project performance. The advent of the web technology with its inexpensive and universal access is an opportunity the project manager must capitalize upon. While some of the project management work processes (Cost, Schedule, Quality) are readily automated, many other project management processes (Human Resources, Risk, etc.) are not anywhere automated. Web technology offers the opportunity for automating all the project management work processes in addition to the ability for the first time to integrate the project management processes electronically. The redundancy in transforming the project information (Input/Output) between project processes can be eliminated. The ability to look at the project as one whole without missing a critical review aspect would be one of the tremendous benefits of using the web in projects management particularly major projects. An analogy to the shift by major companies to ERP systems in the beginning of the ’90s can be drawn. Organizations, to be competitive wanted to be able to look at the whole picture drawn by the integration of the many critical and essential functions in its planning, and controlling of its resources.

Globalization. Today’s competitive world forces the division of work packages of major projects over a number of cost-effective execution locations. The cost of transferring the resources from the well-established and organized execution centers toward the project location makes it prohibitive. Thus, clients are thinking more and more of allowing work to be done at the most cost-effective execution centers. Also, the inherent risks together with diverse set of skills and resources required in complex international projects forces the formation of partnerships, alliances and joint ventures among owners, contractors, and even consultants. Thus, the work for most major projects is broken down into several regionally disbursed packages to fit the abilities and resource profile of the participants. The result is the phenomena of regionally disbursed teams working on the project over a diverse set of objectives, cultures, values, motives, and incentives. Typically, major project players may be located over three to four continents. To be objective, globalization is here to stay. This trend is going to be enforced with all its consequences. Project Manager of the 21st Century has to have the tools to allow him to manage in such unprecedented situation. The technology advances in the communications and information technology enable the globalization trend. The technology available now for the project manager is unheard of couple of years ago.

Project Manager Challenge. The integration of such diverse teams toward the achieving the project objective becomes a challenge for the project manager. This international set-up comes with an environment where the project manager must work across a set of different; working time zone; national and regional holidays; infrastructure for telecommunications; political and social agendas; and set of value (PMI®, PMBOK® Guide). The project manager has to integrate the project processes over many barriers, which is a major communication problem. Many project failures were attributed to the communication problem especially major projects where many teams participate in the project (Krezner, 1984). A good example would be the failures of some missions of NASA where it is almost a regular to quote the communication problem.

Future Trends in Project Management. Project Management systems will have to be more open to change during the next century. The competitive forces will press upon these systems to adopt rapidly to the ever-changing business maps in every industrial venue. The planning decisions will have to continue during the execution phase to allow projects to respond more effectively to external business forces (Jaafari, 1999). The time to market of five and six years will never be an acceptable time for implementing major projects. The breakdown of a project into early design phase, tendering phase and execution phase will not be appropriate to the business risk associated with project implementation. This will necessitate more overlap of project phases into ultimately one project phase. The trend is towards early involvement of key project players in the process. This means that contractors and critical vendors will have to participate early in the project planning decisions. The structure calls for more collaboration between project players; owners, engineers, consultants, contractors, vendors, etc. The effective management of the relationship between the project sponsor and the key project players early in the process will be a critical success factor for the project manger of the 21st Century. The project management teams of the key players will be integrated in the project planning process as an extension to the project sponsor’ own project management team. An open communication channel for rapid exchange of critical project information will be the backbone of such a project organization (Barry & Pascale, 1999). This will require a communication infrastructure that would allow sharing select business information such as execution schedules, available resources, performance metrics, and quality aspects. This paper suggests that the web-technology is the best-suited technology for such future trend.

The Web-Technology. We believe that the web-technology would offer a suitable solution to this problem through the application of web-based project management processes (El Baz, 1999). Web-based project management processes (WBPM) can improve the efficiency and effectiveness of project management process as a whole. In a major industrial development this can be translated into shortened procurement cycle for project human resources, services, and equipment, improved coordination and collaboration with strategic vendors, suppliers and providers, a more streamlined project management processes. The outcome of application of WBPM would be shorter overall project cycles while in the same time establishing open communication channels with critical project player for rapid exchange of vital business information.

Most of web-based or web-enabled project management solutions, currently available, capture project information (in whatever format) in one virtual location and store it for future use or distribute it to a controlled audience. The project information is being updated continuously and posted to project stakeholders. The availability of project information online to worldwide audience of project stakeholders is claimed by solutions providers to improve the probability of project success. It makes critical information for project progress immediately available once it is produced and ensures viable information is available as and when needed. Benefits can be summarized as reducing project administrative costs, shorting the project documentation/deliverable cycles, and more effective management of project changes.

The Stakeholders Analysis

The Project Stakeholders. The first step in any communication planning for a major industrial project is identifying the project stakeholders and their respective role (Verma, 1998). The stakeholders can be classified as internal stakeholder and external stakeholder to a project. The key project stakeholders for a major industrial development would be the:

Project Sponsors: organizations that has an equity interest in the project such as a host Country Government/ Corporate, and foreign partner normally the party that has the technology and the resources to implement the technology.

Project Financiers: organization that provide loans for the project such as investment banks, export credit bodies, commercial and local banks, lead financial arrangers and financial consultants.

Project Service Providers: such us consultants how provide either the know-how or the skilled personnel, engineering companies who provide engineering and procurement services, and constructors who provide construction services, and operators who will ultimately run the project after its completion.

Project Critical Suppliers: the organizations that would deliver the major and critical equipment required for the operation of the project.

The above are the parties that has to be connected to the project web site via either an intra-net (for internal stakeholders) or extra-net (for external stakeholders) solution. The capacities of the bandwidth connection will depend on the information needs at the respective phase of project execution. Information needs will vary over the project life cycle and will depend on the need of the project audience.

Identify Your Audience. The audience of a project web site would be project management staff from any project stakeholder who are specifically assigned by their respective organization to further the project objectives either they are on full-time or part-time basis. The audience of this web site would be people who want project information urgently in order to execute the next step in their respective part or work package and those can cover a very wide variety of interests. The stakeholders’ analysis is concerned with project management and its supporting processes in any of the project participants.

Information Needs. The starting point in identifying stakeholders information needs is to define it in terms of content, format, frequency and level of detail. A stakeholder analysis of the information needs for a major project undertaking in the 21st Century revealed that instant, “real-time” project information would be required most by project management teams, contractors, and major vendors. Nevertheless, top management, end users, and regulatory agencies would also benefit from the availability of immediate information in some instances. Thus, a web site for project information is a welcome addition to the set of tools for the project management professionals.

Transformation to WBPM

The Winds of Change. The decision to move to WBPM for an industrial project would affect the way organizations are performing and affect their traditional tried out business processes. Here comes the cultural change and the necessary shift of paradigm. The change would be first from the paper-based project management processes such us project information distribution and project procurement to the web-enabled electronic data transfer and e-commerce. The transformation needed in such organizations is for them to become e-business organizations allowing system-to-system or system-to-person project delivery (Aberdeen Group Inc, 1999). This is transformation is currently considered by key performers to be very critical to organizational success. Executives must understand the key technological advances and their profound impact on their business process. The transformation will totally change the workflow deleting some traditional best practices and replacing it with new more streamlined ones never heard of before. The use of web technology would pose questions about the accessibility of public to web site, openness for competition, and the level of transparency in the project management process. Answering all the above questions would help in defining the requirements.

Requirements Definition. In moving to the WBPM you have to identify the user requirements. A web site cannot be a fix-it-all solution for all your project management needs. First you have to identify which portion of information is suitable for web site publishing in accordance with the organization appetite of sharing project information. This depends on the readiness of your organization to move to the e-business era as discussed in the earlier paragraph. In the gradual transformation from paper-based project management to WBPM, you can pinpoint on some problems that can be resolved via having a web site for the project, an example would be having a project newsletter or an electronic bulletin board for facilitating change management. The objective is to establish a proof point for management via a quick win solution that can yield instant efficiencies in project performance. Another area would be posting common project documentation on the web site for ease of access and reducing printing costs. Also, developing a chatting area for reviewing and coordinating comments on project deliverables. A higher-level solution would provide facility for collaboration between sponsors, contractors, and vendors on design requirements and details. At the other end, the project web site would support the conduct of project procurement over the Internet, an e-commerce solution. This will lead us to the point where we can identify the contents of our web site and content management needs. Also, the system (intranet/extranet, software, hardware, etc.) connecting project players will have to be defined. This system may even have to change over time to reflect the requirements associated with respective project phase. The ultimate output of this process is the definition of system functionality. The system functionality will be highly affected with the organization ebusiness strategy or not having a strategy at all.

Buy or Make Decision. At this point in your process you can make the “buy or make” decision for the solution that would fit your situation. The buy decision would be a ready-made service provided by solution providers that offer WBPM software or lease a part of their portal to your organization. You have to evaluate the system functionality needed by your organization vers the ready-made solution that the service provider offers. Many companies are offering ready-made WBPM solutions that allow for a lot of functionality. If the ready made solutions does not meet your requirements for system functionality in accordance with your company e-business strategy then you need to make it yourself, the “make” decision. The make decision would leave you the flexibility to move along the e-business transformation at your own pace and built-in functions gradually after the organization get used to the presence of the WBPM. This means that you will need to hire the services of a webmaster to design and maintain the web site.

The Benefits of WBPM

Effective Project Delivery. The argument in this paper is that WBPM would improve the efficiency and effectiveness of the project management process. It is simply providing a “faster, cheaper, and better” solution.

Faster, because it shortens the document review cycle that is reiterated thousands of time during project development. Imagine the improved efficiency gained by posting the project design drawings or specifications on the web site for owners’ team review instantly once the engineering companies produce it. This can eliminate the lag time spent by project team members on the owner side waiting for the project documentation packages to be reproduced, packed, shipped and redistributed internally. The review and comments coordination process can be streamlined by using the web site as tool for collecting comments and their coordination. The project will gain both the benefits of automating the review process and making it available to wide variety of participants. Time also can be gained if the constructors or venders that are involved in the project had the instant access to project design documentation same as project owner. The constructors or vendors can provide critical insights in the practicality and economy of the design aspects that can correct costly ambitious assumptions made early in the process by project designs. The early correction of project planning documentation can help shorten project schedules. Posting of the project documentation on the web site was claimed to have reduced a project schedule by 30% during the project definition phase for a major highway project. By the same token, procurement cycle can be reduced dramatically using the web site as a channel for e-commerce of project procurement. The project requirements for manpower, services, equipment and construction can be posted on the web site. Many solution providers now offer Internet Procurement solutions where the whole procurement process from initial sourcing to placing the order is done over the Internet. The reduction of the purchase cycle was reported by many organizations that reported their migration to Internet procurement. The web site can contain solicitations of interest, requests for proposals, requests for quotations, direct purchase orders, etc. The whole tendering process can gain the benefits of both automating the tendering process and instant response due to the shortened cycle. Information exchange between industry players in general and project participants in particular can be made on the web site allowing instance response to queries from different parties. Owners can obtain strategic sourcing information instantly from the net about engineers, contractors, and vendors. Response time can be vastly reduced. Having standard response information on the web site of the selling organizations can eliminate even the redundancy of refilling standard forms of response to enquiry documents by owners. Contractors, Consultants, and Vendors can respond immediately to owners’ requests for information. Owners can make clarifications, changes, and amendments to tender documents and posted immediately on the Internet to Contractors, Consultants and vendors. The whole tendering process could give a tremendous push for early completion of projects by the introduction of the web technology into the project management process. Several weeks can be slashed out of the current tendering process, which would benefit the project bottom line. Moreover, posting project information 24/7 would eliminate the artificial buffer created by the difference in time zone, difference of weekend schedule, difference in workday schedule, difference in religious and historical holidays schedule, etc.

Exhibit 1. Document Review Cycle

Document Review Cycle

Exhibit 2. Concerns

Concerns
Limitations       Mitigation

Transaction Security

Virus Protection

Paper-based Process

Policies/Procedures

Fraud/Theft

Delay/WWW

 

Firewalls

Hygiene

Reengineering

Change Management

E-Commerce Law

Internet II

Cheaper, WBPM can reduce the project administrative costs. Costs for project documentation reproduction of, overnight shipping, redistribution can be reduced dramatically. Reduction of purchase order internal cost to company where reported in companies using Internet procurement. Communication costs between project participants can be reduced using the alternative communication modes made available by the web technology like chat rooms, virtual meetings, white boards, etc. The need for business travel to coordinate project issues will definitely be reduced. The indirect cost benefit associated with the reduced resources assigned to the project due to shortened project duration can also be accounted for. The learning curve for new project participants be improved since can learn about the project history and free up a lot of other participants time. The above cost savings can even be better realized in an international project where the cost of project administration is quiet significant.

Better. WBPM can improve the quality of work done in the various project packages. The most significant area in quality improvement is evident in facilitating change management. Changes of owner requirements, local regulations, design philosophy, suppliers’ information, or advance in technology can impact the quality of project work. Nevertheless, these changes are part of the project management process and the future will even oblige project managers to be more responsive to the ever-changing business circumstances outside their domain of control. The project manager’s ability to respond effectively to requirements for project changes, performing cost/benefit analysis in view of the project ultimate business objectives will be one of the characteristics of successful project managers. Thus the project manager needs the tools that enable him to communicate changes instantly to key project players and solicit their honest and sincere feedback. Furthermore, the timely integration and coordination of approved changes have a profound impact on the amount of rework caused by them. These changes would have a domino effect on the work performed in various work packages affected by such changes. Implementing a change newsletter on the project web site can vastly reduce rework in various work packages. Whenever a change is introduced in the process, all affected parties are posted about its evolution and can provide candidate “real-time” advise about its implication on project cost, schedule, and quality.

Improved Decision-Making. A better-informed project manager would be in a much better position to provide essential feedback to top management within his organization. The same goes for any project participant management teams. Top management in all the project key players will be better informed about project developments than under traditional project management processes. Thus, the quality of decision-making will be improved projectwide.

Limitations of WBPM

The transformation from paper-based project management to WBPM would face several challenges. These challenges are similar to those of implementing new software or an EPR system. Interface issues with existing systems should be addressed. Top management will be concerned with the security of confidential project information. Some of the organization policies and procedures will need to be redrafted to reflect the changes needed to transform to e-business. A table of the challenges faced during implementing WBPM is listed below together with the mitigation efforts.

Cost/Benefit Analysis

Cost. The cost of transferring to WBPM from traditional paper-based project management can vary from one thousand U.S. dollar to several thousands depending on the level of sophistication, features, and reliability. The web site must be developed and maintained by the organization primarily concerned with managing the project. The beauty of migrating to WBPM is that it needs almost nil training costs. Most of the professional working on major projects are familiar with web browsing. It takes a common standard of communication for the project information to be exchanged back and force along this channel. The return on investment for implementing Internet procurement solutions proved to be great. Many companies are reporting 400% in the first year. The return on investment can be calculated in different ways. Major cost considerations for this web site would include whether you use external service provider or use your own server; level of interactivity required and security of electronic transactions.

Benefits. The benefits of using the web technology in project management are tangible and intangible. Tangible benefits include:

The reduction in project administrative costs (which can be significant in a major project).

The reduced rework anticipated as an outcome of early participation of knowledgeable project stakeholder.

The reduced total procurement cycle would definitely reduce the project indirect costs and project duration.

Intangible benefits include improved decision making projectwide, due to the abundance of project information.

While there is no research validating the cost savings due to migrating WBPM, benefits can be easily quantified. The business case for economic viability needs to be established to prove this initiative. Proper metrics for measuring the cost of project communication should be in place first before we try to compare results. This means that we need to segregate project communication costs out of our general overhead costs in order to compare the processes (paper-based vers web-based). The business case for the use of web technology should be established through counting the expenditure on communication and information gathering of the projects department “before” using the Internet and “after” using the Internet. Emphasis should be on the cost of “not” using the web site in project management; prolonged procurement cycle, increased communication costs, increased project development costs for all project participants. Another consideration is that the benefit should be experienced not only in-house, but also, within all outside project stakeholders and participants. The benefits should be reflected in generally lower over-head contingency and in turn lower pricing and charges to owner. Therefore, tangible and in-tangible benefits must be accounted for in a way to assess improved performance.

Conclusion of the Report

1. The use of web-based project management is claimed to have the following advantages:

Improve probability for project success

Reduce rework, abortive work, and duplication of work.

Improve decision-making process (projectwide)

Improve Overall Project Communications.

2. The restriction of project information to a later stage in the project from interested project participants can be to the detriment of project objectives. It is urged that transparency in the project management process allowed by the use of web technology would provide a better venue for project delivery.

3. Electronic commerce can benefit project execution; however, a legal infrastructure should be in place to secure such transactions. International Laws governing electronic commerce transactions need to be enacted, treaties need to be signed and specific regulations needs to be drafted. Moreover, corporate policies and procedures need to be amended to allow for the use of web site in tendering and procurement.

References

Aberdeen Group, Inc. (1999, July). Strategic procurement: The next wave of procurement automation. An Executive White Paper.

Barry, Ann Marie, & Pascale, Steven. (1999, March). Web management and integrated procurement communication. Project Management Journal, 30 (1).

Bishop, Suzzanne K. (1999, Sept.). Cross-functional project teams in functionally aligned organizations. Project Management Journal, 30 (30).

Jaafari, Ali. (2000, March). Life cycle project management: A proposed theoretical model for development and implementation of capital projects. Project Management Journal, 31(1).

Kerzner, Harold. (1984). Project management: A systematic approach for planning; scheduling; and controlling.

PC Novice. (1998). Guide to Building Web sites: Everything you need to create your own working web site.

Pitagorsky, George. (1998, August). Building A Communication Infrastructure. PM Network.

PMI Standards Committee. (1996). A Guide to the Project Management Body of Knowledge. Tools and Techniques for Communication Planning, p. 105.

Verma, Vijay K. (1995). Organizing projects for success—The human aspects of project management. Interfacing with major stakeholders, p. 73.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

Proceedings of the Project Management Institute Annual Seminars & Symposium
September 7–16, 2000 • Houston, Texas, USA

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