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Global Project Management

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Global Project Management

  1. 1. Project Management 10. Global Project Management
  2. 2. Week 10
  3. 3. Today we learn to apply the project management framework to IT projects within a global context
  4. 4. Gray & Larson, 2006, Ch’s 12 and 15.
  5. 5. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  6. 6. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  7. 7. What is projectpartnering?
  8. 8. Project Partnering is a process oftransforming contractual arrangements into a cohesive, collaborative team that deals with issues and problems encountered to meet a customer’s needs
  9. 9. Project Partnering is a process oftransforming contractual arrangements into a cohesive, collaborative team that deals with issues and problems encountered to meet a customer’s needs
  10. 10. Assumptions1. the traditional adversarial relationship between the owner and contractor is ineffective and self-defeating 2. that both parties share common goals and will mutually benefit
  11. 11. AdvantagesAdvantages Reduced administrative costs Reduced administrative costs Better resource use Better resource use Improved communication Improved communication Improved performance Improved performance
  12. 12. DisadvantagesDisadvantages ?
  13. 13. These things help Existence of common goals High costs of the adversarial approach Shared benefits of the collaborative approach
  14. 14. These things don’tConflicting goalsLack of trustHighly formalrelationshipPushing people beforethey are ready
  15. 15. It’s not as easy as it sounds
  16. 16. Sub Client EndContractor Performing organisation organisation Customer Consider this scenario
  17. 17. Goal alignment? Sub Client EndContractor Performing organisation organisation Customer Consider this scenario
  18. 18. Maximise customerrevenue, Reliable margin, on time and satisfaction Cheap andminimise budget, generate more work & minimise convenient costs risk Sub Client EndContractor Performing organisation organisation Customer Consider this scenario
  19. 19. Maximise customerrevenue, Reliable margin, on time and satisfaction Cheap andminimise budget, generate more work & minimise convenient costs risk Conflict! Sub Client EndContractor Performing organisation organisation Customer The sub contractor wants to use existing systems and processes, which may help the P.O.’s ability tothis scenario but Consider manage costs, might restrict it’s ability to generate goodwill through lack of flexibility.
  20. 20. Maximise customerrevenue, Reliable margin, on time and satisfaction Cheap andminimise budget, generate more work & minimise convenient costs risk Conflict! Sub Client EndContractor Performing organisation organisation Customer The P.O. wants to manage it’s delivery to be on time and on target. This helps the client minimisescenario Consider this risk, but decreases flexibility. New customer requirements will be harder to implement.
  21. 21. Maximise customerrevenue, Reliable margin, on time and satisfaction Cheap andminimise budget, generate more work & minimise convenient costs risk Conflict! Sub Client EndContractor Performing organisation organisation Customer The client organisation wants to maximise customer satisfaction, which may lead to trying to include Consider this scenario all possible client requirements. This will probably make the solution too complex for most customers who want a cheap and convenient solution.
  22. 22. Maximise customerrevenue, Reliable margin, on time and satisfaction Cheap andminimise budget, generate more work & minimise convenient costs risk Conflict! Conflict! Conflict! Sub Client EndContractor Performing organisation organisation Customer Collaborating isn’t always easy.
  23. 23. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  24. 24. Key Practices in Partnerships Partnering Relationships Traditional Practices Mutual trust forms the basis for Suspicion and distrust; each party is strong working relationships. wary of the other. Shared goals and objectives Each party’s goals and objectives, ensure common direction. while similar, are geared to what is best for them. Joint project team exists with high Independent project teams; teams are level of interaction. spatially separated with managed interactions. Open communications avoid Communications are structured and misdirection and bolster effective guarded. working relationships. Long-term commitment provides Single project contracting is normal. the opportunity to attain continuous improvement.Table 12.1 Project Partnering Framework(Gray & Larson, 2006, p384)
  25. 25. Key Practices in PartnershipsPartnering Relationships Traditional PracticesObjective critique is geared to Objectivity is limited due to fear ofcandid assessment of reprisal and lack of continuousperformance. improvement opportunity.Access to each other’s Access is limited with structuredorganization resources is procedures and self-preservation takingavailable. priority over total optimization.Total company involvement Involvement is normally limited torequires commitment from CEO project-level personnel.to team members.Integration of administrative Duplication and/or translation takessystems equipment takes place. place with attendant costs and delays.Risk is shared jointly among the Risk is transferred to the other party.partners, encouraging innovationand continuous improvement.
  26. 26. Figure 12.1 Project Partnering Framework(Gray & Larson, 2006, p384)
  27. 27. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  28. 28. Types of Contracts
  29. 29. Fixed Price Fixed Price Cost Plus Cost Plus Types of Contracts
  30. 30. Fixed Price Fixed Price Cost Plus Cost Plus AKA AKA AKA AKA Lump Sum Lump Sum Time and Materials Time and Materials Types of Contracts
  31. 31. The contractor lowest bid agrees to The contractor lowest bid agrees to perform all work specified in the perform all work specified in the contract at a fixed price. contract at a fixed price. Disadvantages DisadvantagesFixed Price Fixed Price • More difficult and more costly • More difficult and more costly to prepare (for client) to prepare (for client) • The risk of underestimating • The risk of underestimating project costs (for contractor) project costs (for contractor) Contract adjustments Contract adjustments • Re-determination provisions • Re-determination provisions • Performance incentives • Performance incentives Types of Contracts
  32. 32. Contractor is reimbursed for all Contractor is reimbursed for alldirect allowable costs (materials, direct allowable costs (materials,labor, travel) plus prior-negotiated labor, travel) plus prior-negotiatedfee (set as a percentage of the total fee (set as a percentage of the totalcosts) to cover overhead and profit. costs) to cover overhead and profit. Cost Plus Cost PlusRisk to client is in relying on the Risk to client is in relying on thecontractor’s best efforts to contain contractor’s best efforts to containcosts costsControls on contractors Controls on contractors • performance and schedule • performance and schedule incentives incentives • costs-sharing clauses • costs-sharing clauses Types of Contracts
  33. 33. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  34. 34. When working under a contract change mustbe controlled. Week 4
  35. 35. The contract Change ControlSystems must link to projectchange control systems
  36. 36. Process by which a contract’s authorized scope (costs and activities) may bemodified: – paperwork – tracking systems – dispute resolution procedures – approval levels necessary for authorizing changes
  37. 37. If you don’t include change control system provisions in the originalcontract, what will happen?
  38. 38. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  39. 39. Classes of International Projects Domestic Overseas Foreign Global
  40. 40. Done at home for clients at homeDomestic (e.g. my day job) Doing work for local clients in a foreign countryOverseas (e.g. mining project for Australian firm in New Guinea) Done in a foreign country for clients in that countryForeign (e.g. a project for Microsoft performed in the USA) Done by a team located around the world Global (e.g. Siemens global product development team)
  41. 41. Issues in International Management Environmental factors Global expansion Challenges Selection and training
  42. 42. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  43. 43. International AssignmentsPositives Negatives Increased income Absence from home and friends, and family Increased responsibilities Security risks Career opportunities Missed career opportunities Foreign travel Difficulties with language, culture, and laws New lifetime friends
  44. 44. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  45. 45. 6 Environmental Factors
  46. 46. Figure 15.1 Environmental Factors Affecting International Projects(Gray & Larson, 2006, p490)
  47. 47. Legal/PoliticalPolitical stabilityNational and local laws andregulationsGovernment, state and localbureaucraciesGovernment interference orsupportGovernment corruption
  48. 48. SecurityInternational terrorismNational and local securityLocal crime and kidnappingRisk management
  49. 49. GeographyClimate and seasonal differencesNatural obstacles
  50. 50. EconomicGross domestic product (GDP)Protectionist strategies andpoliciesBalance of paymentsCurrency and exchange ratesInflation ratesLocal labor force: supply,educationaland skill levels
  51. 51. InfrastructureTelecommunication networksTransportation systemsPower distribution gridsUnique local technologiesEducational systems
  52. 52. CultureCustoms and social standardsValues and philosophiesLanguageMulticultural environments
  53. 53. Environmental analysis in action
  54. 54. Figure 15.2 Assessment Matrix Project Site Selection(Gray & Larson, 2006, p495)
  55. 55. Figure 15.3 Evaluation Matrix Breakdown for Infrastructure(Gray & Larson, 2006, p495)
  56. 56. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  57. 57. Cross Cultural Factors
  58. 58. Organisational culture modelsWeek 4
  59. 59. Culture is asystem of shared norms, beliefs, values, and customs that bind people together, creating shared meaning and a unique identity
  60. 60. Cultural Differences Geographic regions Ethnic or religious groups Language Economic
  61. 61. What do we call it when someone has a beliefthat their cultural values and methods aresuperior to others?
  62. 62. What do we call it when someone has a belief thattheir cultural values and methods are superior toothers? Ethnocentric Perspective
  63. 63. What do we call it when someone has a belief thattheir cultural values and methods are superior toothers? Ethnocentric PerspectiveYou find it when people are conducting business in your terms; stereotypingother countriesIt manifests as ignoring the “people factor” in other cultures by putting workahead of building relationships
  64. 64. You (and I) need to makeadjustments when dealing withpeople from other cultures.
  65. 65. Relativity of time andpunctualityCulture-related ethicaldifferencesPersonal and professionalrelationshipsAttitudes toward work and life
  66. 66. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  67. 67. Relation to Nature: How people relate to the natural world around them and to the supernaturalTime Orientation: The culturefocus on the past, present, or future Activity Orientation: How to live: “being” or living in the moment, doing, or controlling Basic Nature of People:Whether people viewed as good, evil, or some mix of these two Relationships Among People:The degree of responsibility one has for others
  68. 68. Note: The line indicates where the United States tends to fall along these issues.Figure 15.4 Kluckhohn – Strodtbeck’s Cross-Cultural Framework(Gray & Larson, 2006, p495)
  69. 69. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  70. 70. Cultural Dimensions Framework Individualism versus collectivism Identifies whether a culture holds individuals or the group responsible for each member’s welfare Power distance Describes degree to which a culture accepts status and power differences among its members Uncertainty avoidance Identifies a culture’s willingness to accept uncertainty and ambiguity about the future Masculinity-femininity Describes the degree to which the culture emphasizes competitive and achievement- oriented behavior or displays concerns for relationships
  71. 71. Where are we on this grid?Figure 15.5 Sample Country Clusters on Hofstede’s Dimensions ofIndividualism – Collectivism and Power Distance(Gray & Larson, 2006, p499)
  72. 72. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  73. 73. Relying on Local Intermediaries Translators Social connections Expeditors Cultural advisors and guides
  74. 74. Culture ShockThe natural psychologicaldisorientation that peoplesuffer when they moveinto a different culture
  75. 75. Coping with Culture ShockCreate “stability zones” resembling home Modify expectations and behavior Redefine priorities and develop realistic expectations Focus on tasks and relish accomplishments Use project work as a bridge until adjusted to the new environment Engage in exercise, meditation, relaxation, and keep a journal
  76. 76. Figure 15.5 Culture Shock Cycle(Gray & Larson, 2006, p507)
  77. 77. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  78. 78. Selection and training for overseas jobsSelection and training for overseas jobs
  79. 79. Selection FactorsWork experience withcultures other thanone’s ownPrevious overseas travelGood physical andemotional healthKnowledge of a hostnation’s languageRecent immigrationbackground or heritageAbility to adapt andfunction in the newculture
  80. 80. Areas for Training Religion Dress codes Education system Holidays—national and religious Daily eating patterns Family life Business protocols Social etiquette Equal opportunity
  81. 81. Learning Approaches to Cultural FluencyInformation-giving—learning of information or skills from a lecture-type orientationAffective—learning of information/skills that raise the affective responses on the partof the trainee and result in cultural insightsBehavioral/experiential—a variant of the affective approach technique that providesthe trainee with realistic simulations or scenarios
  82. 82. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  83. 83. Successful partner relationships begin with the search.
  84. 84. And just like you have to develop ateam, you have to develop partner relationships.
  85. 85. Selecting Voluntary, experienced, willing, with committed top management. Teambuilding Project managers Expand the partnership Project commitment to include stakeholders other key managers and specialists Build a collaborative relationship among the project managers.
  86. 86. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  87. 87. Good people are hard to find. So are good business partners.
  88. 88. If you find goodpartners you wantto stick with them
  89. 89. ips! T Establish a “we” as st ic opposed to “us and them” n ta attitude toward the project Fa3 Co-location: employees from different organizations work together in same location Establish mechanisms that will ensure the relationship withstands problems
  90. 90. ti ps at gre Problem resolution o re4 M Continuous improvement Joint evaluation Persistent leadership
  91. 91. Figure 12.2 Project Partnering Charter(Gray & Larson, 2006, p387)
  92. 92. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  93. 93. It is important to Celebrate Success
  94. 94. At major milestones and the ended of the projectConduct a jointly review of accomplishments and disappointments. Hold a celebration for all project participants. Recognize special contributions
  95. 95. It’s about reinforcingpositive behaviour
  96. 96. Figure 12.3 Sample Partnering Evaluation(Gray & Larson, 2006, p389)
  97. 97. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  98. 98. Partnerships fail regularly.
  99. 99. Seniormanagementdon’t support you
  100. 100. Cultural differences are forgotten or ignored
  101. 101. The wrong measurements are applied
  102. 102. The wrongincentives are inplace
  103. 103. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  104. 104. Negotiation: Art or science?Negotiation: Art or science?
  105. 105. Project management is NOT a contest. (Usually…) Everyone is on the same side—OURS Everyone is bound by the success of the project Everyone has to continue to work together
  106. 106. Principled Negotiations call forSeparating the people from the problemFocusing on interests, not positions Inventing options for mutual gainAnd whenever possible, use objective criteria to help you achieve your goals
  107. 107. If pushed, don’t push back Ask questions instead of making statements Use silence as a response to unreasonable demands Ask for advice and encourage others to criticize your ideas and positions Use Fisher and Ury’s best alternative to a negotiated agreement (BATNA) concept toWarnings for dealing with work toward a win/winWarnings for dealing with scenario Unreasonable People Unreasonable People
  108. 108. Concepts we will cover Project Partnering Cultural Dimensions FrameworkKey Practices in Partnerships Working in Different Cultures Types of Contracts Selection and Training Contract Changes Successful Partnering International Projects Sustaining Relationships International Assignments Celebrating Success Environmental Factors Partnering Failures Cross Cultural Factors The Art of NegotiatingCross-Cultural Orientations Customer Relations
  109. 109. Your goal is ahappy customer
  110. 110. So what makes a customer happy? So what makes a customer happy?
  111. 111. The negative effect ofdissatisfied customers is fargreater than positive effect ofsatisfied customers(Richins 1983)
  112. 112. The negative effect ofdissatisfied customers is fargreater than positive effect ofsatisfied customers(Richins 1983)In today’s moderncommunications environmentthat message can travel fasterand wider(Hoch, 2006)
  113. 113. Every customer hasperformance expectationsand perceptions(Parasuraman 1991)
  114. 114. Satisfaction is a perceptual relationship!Perceived performance Perceived performanceExpected performance Expected performance
  115. 115. Project managers must be skilled at managing both customerexpectations and perceptions
  116. 116. Your checklist;  Don’t oversell the project; better to undersell  Develop a well-defined project scope statement  Share significant problems and risks  Keep everyone informed about the project’s progress  Involve customers early on decisions about project development changes  Handle customer relationships and problems in an expeditious, competent, and professional manner  Speak with one voice  Speak the language of the customer
  117. 117. Review• Successful project partnering reduces costs, increases resource utilization, improves communication and performance.• Types of contracts include; Fixed-Price or Cost-Plus. A contract change control system is important.• Issues affecting international projects include; economic, legal, security, infrastructure, culture, and geography.• Issues for project expatriates include; dealing with culture shock, and local services and amenities.• Training is required in understanding foreign cultures such as; religion, dress, education, family life, eating, holidays …• Successful partnerships require; team building, negotiating, and managing customer satisfaction and expectations.
  118. 118. BetterProjects.net Source of Cover picture is unknown.It arrived in an email. I thought I’d use it anyway. 

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