The Traditional Organization
When the execution of projects is a normal part of the organization's business, it is expected that the organization will establish, in parallel with the Operations function, a function to manage the projects. This would normally include a Central Project Office or Project Management Office (PMO), and specialized personnel to manage projects. The PMO, under a Chief Project Officer (or similar title) will develop standards and practices directed at the effective execution of projects and the attainment of schedule, cost, scope and quality objectives. In doing so, a project management planning and information system is put in place, and periodic measurements of project progress and performance are conducted.
In the traditional organization, responsibility for determining and achieving the organization's goals are assigned to the Operations function. Senior managers, having titles such as COO, CTO, CIO, CFO, Strategic Planner, etc., establish objectives and goals, and develop strategies to achieve these. When there are projects associated with these goals, these senior managers are expected to select from a menu of proposed and pending projects. The objective is to create the mix of projects most likely to support the achievement of the organization's goals - within the preferred strategies - and within the organization's resource (people and funding) constraints.
A problem, common to many organizations, is that there is no connection between the Operations and Projects functions, nor is there a structured, consistent, and meaningful flow of information between these two groups. The organization's objectives (enterprise-level goals) are hardly ever communicated to the Project Office, and the periodic measurements made by the projects group cannot be related to these objectives.
What a waste! Both groups are off in their own little world - working to do the best that they can, but not knowing if their efforts are really being effective or efficient. Are the projects that are being worked on (assuming that they were properly selected in the first place) still the best ones to support the objectives? How well are they supporting the objectives? Are there performance issues associated with meeting the objectives? How would the Operations people know?
And over in the Project Office, when the project performance data is evaluated, what knowledge is available to influence the corrective action decisions? If the individual project objectives are in danger, what should the project manager know to work on balancing schedule, cost, scope and quality parameters? Can this be effectively done in the absence of operations inputs?