Project management practice by the public sector in a developing country

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PERGAMON International Journal of Project Management 18 (2000) 105±109 www.elsevier.com/locate/ijproman Project management practice by the public sector in a developing country Ghaleb Y.

Al-Mharmah University of Jordan Faculty of Engineering and Technology, Industrial Engineering Department, Amman, Jordan Abstract The use of Project Management (PM) in developing countries is becoming

1 PERGAMON International Journal of Project Management 18 (2000) 105±109 Project management practice by the public sector in a developing country Ghaleb Y. Abbasi *, Hisham A. Al-Mharmah University of Jordan Faculty of Engineering and Technology, Industrial Engineering Department, Amman, Jordan Abstract The use of Project Management (PM) in developing countries is becoming an important issue in implementing modern projects. This paper is aimed at exploring the PM tools and techniques used by the public sector in Jordan, which is a developing country with a rapidly growing economy. The PM phases and tools were presented. A survey was conducted for the major fty industrial public rms in Jordan, and statistically analyzed to identify the use of PM tools and techniques. Also, the obstacles to proper implementation of such tools were presented. Bene ts and drawbacks of the use of these techniques were discussed. In conclusion, more e ort should be spent on training, planning, resource leveling, cost estimation, corrective plans, and standardization. # 2000 Elsevier Science Ltd and IPMA. All rights reserved. Keywords: Management techniques; Project management; Developing countries 1. Introduction PM is the art and science of planning, designing and managing work throughout all the phases of the projects life cycle. It is a relatively modern practice that attempts to achieve planned objectives within speci c time and cost limits through optimum use of resources using an integrated planning and control system. PM is an essential contributor in the process of development. Projects such as roads, dams, irrigation works, schools, houses, hospitals, factories and others are the physical foundations on which development e orts and improved living standards are established. The growth and acceptance of project management is continuing to increase as resources become scarce. The application of PM concepts is an essential tool for planning, organizing, managing and control of work, which leads to better performance and increased productivity * Corresponding author. Tel.: x2793; fax: ; abbasi@fet.ju.edu.jo. PM started in the 1950's due to the increase of projects complexity and the need to manage multiple projects at several locations. In the 1960's, the Project Management Institute (PMI) was founded in the USA, with the objective of promoting the development of PM, and of spreading the technology and PM training methods. Parallel to the development of PM in North America, some European professionals from Sweden, France, Holland and Germany started a dialogue for creation of a debate forum on PM implementation. In 1965, an international network was formed in Europe to promote PM. In 1979, the International Project Management Association was formally established. Later, and in various countries of Western Europe and the Near East, national associations were initiated. In developing countries the implementation of PM tools and techniques is still in its early phases of development. The existence of several social, cultural, political, and nancial problems leads to poor management performance. Therefore, the strategy for implementing PM in developing countries must be consistent with the cultural and characteristics of the particular society and con guration of its economic, political and administrative systems. Stuckenbruck and Asghar [1] pre /00/$20.00 # 2000 Elsevier Science Ltd and IPMA. All rights reserved. PII: S (98)00074-X

2 106 G.Y. Abbasi, H.A. Al-Mharmah / International Journal of Project Management 18 (2000) 105±109 sented general guidelines that could help developing countries to more e ectively implement and use PM. Also, Muspratt [2] gave a full discussion on the conditions a ecting projects in less developed countries. The development of PM in one of the developing countries is presented by Codas [3]. Elements of successful PM are presented by Cash and Roberts [4], and several techniques on evaluating the project success are discussed by Pinto and Dennis [5]. Recently, the economy in Jordan is growing rapidly due to the new atmosphere in the region. Several large projects are being proposed and implemented. However, there is a lack of modern tools, methods and techniques necessary in the eld of PM for programming, planning and controlling projects to achieve the desired goals within time, cost and standards. As a result, some of the local contracting enterprises have failed to properly perform their duties concerning the rules, speci cations and deadlines of the projects awarded to them. Also, local contractors are unable to compete for large projects without foreign joint ventures. In this paper, the PM methods used in Jordan are investigated. The goal of this work is to investigate the implementation of the complete project management concepts, i.e., from the initial planning phase, passing through scheduling of time, cost and resources, then ending with the control phase until the project is accomplished. The implementation of the modern PM tools and techniques (such as simulation, expert systems and others) is not tackled, due to our belief that such tools are still far away from implementation by the majority of project planners in developing countries. The type, size and complexity of the standing projects in most of the developing countries direct the planners and decision-makers toward the classical tools of PM. To achieve the objectives of this work, a sample of 50 companies was randomly selected representing the major industrial public organizations. The data collected was statistically analyzed to make inferences about the population of all public organizations. 2. Project management phases and tools PM can be de ned as the process of planning, scheduling, budgeting and controlling of the project's interrelated activities in order to achieve speci c objectives within time, budget and standards. One of the most important phases of project management is the `Planning Phase', in which all work to be done is determined and de ned. The Planning Phase may be considered as the most time consuming phase and at the same time the most rewarding one if done properly. Planning is an ongoing process until the project is completed; all deviations from the original plan are dealt with during execution. The `Scheduling Phase' determines when and how work will be done; it deals with establishing timetables and dates during which the resources (personnel, machinery and others) are utilized to perform the required work. The `Controlling Phase' is conducted during implementation, and may be seen as the process of measuring progress toward the project objectives, evaluation of the work performed and the remaining work required to achieve the objectives, and then taking the necessary corrective action. In order to measure progress, reports should be submitted at di erent milestones concerning: work completed, work ahead of schedule, and work behind schedule. The interaction among the three phases is shown in Fig. 1. Di erent tools are used in the management process such as tables, work breakdown structure (WBS), charts and networks. Tables are used to present the project activities and relevant information such as duration, dependency, cost, starting points, ending points, required resources, etc. Tables are used during the planning and controlling phase and can be used as an implementation and progress measurement tool. WBS is an organizational chart that breaks the project into subsystems, components and tasks that can be readily accomplished. It is used for scheduling, pricing and resource planning. WBS simpli es summarizing and reporting progress and costs (see Davies) [6]. Organization Break Down Structure (OBS) is a model that provides a way of organizing resources into groups for better management with an organization. It can be used to keep track of resource allocation and speci c work assignment. There is a strong interdependency between OBS and WBS (see Badiru and Pulat) [7]. Charts such as the Gantt Chart is one of the oldest planning tools which was developed during World War I and has proven useful since then. It is clear, Fig. 1. The dynamic PM process.

3 G.Y. Abbasi, H.A. Al-Mharmah / International Journal of Project Management 18 (2000) 105± Table 1 Descriptive statistics for the employees quali cations Degree Mean employee/company Standard deviation Minimum Maximum Ph.D M.Sc B.Sc Two-year college High-school diploma Uneducated simple and easy to use and understand, however; interdependency between activities is not easily represented, especially in large projects, hence networks are used. Networks are a graphical display of the project activities showing their interdependency. Several network techniques have been introduced and used over the years. Mainly two types of networks can be used, depending on the type of project under consideration: deterministic and probabilistic methods. For representation, either activity-on-arrow (AOA) or activity-onnode (AON) are used to model the project. The probabilistic method is designated as program evaluation and review technique (PERT), while the deterministic method is called either precedence diagramming method (PDM) which uses AON method for representation, or arrow diagramming method (ADM) which uses AOA method for representation. All of the above methods use what is known as the critical path method for determining the project duration, critical path(s), oats and other relevant data. The implementation of the above tools in Jordan is measured and evaluated in later sections. 3. Data collection and analysis Jordan has experienced a tremendous growth in the last few years in almost all kinds of industries and businesses. In order to analyze PM practices by the public sector in Jordan, a questionnaire was generated to measure the level of usage of the mentioned PM tools and to identify problems, bene ts and obstacles a ecting the implementation of such tools. A random sample of 50 rms was selected representing the public sector. The adopted methodology for selecting the sample took into consideration the various types, capitals, duties and sizes of the public rms in Jordan. The sample was evenly distributed among all types of public rms. The questionnaire was lled out by interviewing the person in charge of the planning and management. Personal interviews with the top management in many rms have facilitated the process of lling the questionnaires in terms of better accuracy and more seriousness. The questionnaires aimed at collecting information about: general data, PM practices in the public sector, the reasons behind using PM tools, bene ts, obstacles and drawbacks. Relevant statistical analysis was conducted on the collected data to explore di erent issues of this research. Minitab, a statistical software, was used to obtain the results. The education level of the work force in the surveyed companies is shown in Table 1. As noticed, most of the hired people are educated. The uneducated sta represent only 45% of the companies' total number of employees on average. All the surveyed rms Table 2 The implemented PM methods Technique % 95% Con dence interval Program evaluation and review technique (PERT) ±37.0 Activity on arrow (AOA) ±18.8 Activity on node (AON) ±12.6 Bar chart ±71.4 Organization breakdown structure (OBS) ±48.2 Work breakdown structure (WBS) ±44.6 Critical path method (CPM) ±51.8 Time cost analysis ±68.3 Resource leveling ±40.9 Reporting progress ±71.4 Developing and implementing corrective plans ±58.6 Evaluation of project success ±61.9 Project management software ±85.7

4 108 G.Y. Abbasi, H.A. Al-Mharmah / International Journal of Project Management 18 (2000) 105±109 Table 3 Reasons for implementing PM Reason % 95% Con dence interval Poor overall performance ±71.4 Unsuccessful scheduling ±48.2 Long completion dates ±58.6 Unstable man-power needs ±44.6 Delay in receiving raw materials ±44.6 Lack of organization ±65.2 Communication complexity ±40.9 have at least one employee with four-year college degree, with an average of 60.8 workers holding a B.Sc. in di erent majors. The average number of employees holding graduate degrees (Ph.D. and M.Sc.) in each company is quite reasonable as shown in Table 1. The main part of the questionnaire focuses on investigating the most implemented common techniques of PM. Table 2 shows the percentage of companies that are using any of the listed techniques. To generalize the sample results on the population for the entire public sector companies, 95% con dence intervals are established and shown in Table 2. As noticed, time cost analysis and project management software are the most widely implemented techniques. In Table 3, the real factors behind motivating the top management in the surveyed companies to consider implementing PM tools and techniques are identi ed. As shown, poor overall performance and lack of organization are the most motivating factors, while communication complexity is the least signi cant one. The obstacles facing the extensive implementation of PM are listed in Table 4. As shown, the crucial obstacle is the di culty faced by the practitioners to estimate the cost of each activity in their projects. Table 5 poses the bene ts acquired by those who have implemented PM techniques and tools. Knowing work progress and having better work organization are the highly perceived bene ts. On the other hand, the drawbacks of establishing PM are shown in Table 6. The associated high cost of establishing PM is the most observable problem. Correlation coe cients among di erent factors that could a ect the level of implementing PM tools, the obstacles faced, and the bene ts gained are shown in Table 5 Bene ts of employing PM Type of bene t % 95% Con dence interval Known work progress ±66.6 Better work organization ±88.4 De ned goals and objectives ±71.4 Good management of human resources ±80.2 Better communication ±61.9 Better time utilization ±80.2 Better quality ±65.2 Table 7. Three factors are considered herein; date of establishment, total number of employees, and types of business. It is noted that the data of establishment has a negative correlation with implementing PM tools, the obstacles faced and the bene ts gained. Therefore, old companies in Jordan are still resisting the change for implementing PM methods, and gain fewer bene ts in the case of implementing any of the PM tools and techniques. 4. Conclusions Project Management has proven to be an e cient approach, which would help developing countries in upgrading their management capabilities and enable them to e ciently complete projects and attain development goals. Jordan is considered to be one of the leading developing countries in the region, where high capital projects require better utilization of management tools and practices. Evaluating the implementation of PM methods by the public sector in Jordan would serve as general guidelines for the decisionmakers in other developing countries to better plan their e orts toward e cient implementation of PM techniques. In Jordan, almost half of the working force in the public sector companies are educated which represent a solid base for better usage and implementation of the PM techniques. However, the lack of knowledge of these techniques is still an obstacle. Among the PM tools, the Gantt chart is the most widely used, this is because of its simplicity and applicability in all phases. However, in large projects networks could be more Table 4 Obstacles facing e cient utilization of PM Obstacle % 95% Con dence interval Lack of knowledge ±44.6 Change in authority ±40.9 Di culties in estimating activity cost ±58.6 Table 6 Drawbacks of employing PM Item % Weak interface with customers 3.12 High cost of management 21.9 None 68.7

G.Y. Abbasi, H.A. Al-Mharmah / International Journal of Project Management 18 (2000) 105±109 109 Table 7 Correlation coe cients Implemented PM tools Obstacles Bene ts Date of establishment 0.434 0.

It is obvious that the use of networks among public sector companies for PM is considerably low.

5 G.Y. Abbasi, H.A. Al-Mharmah / International Journal of Project Management 18 (2000) 105± Table 7 Correlation coe cients Implemented PM tools Obstacles Bene ts Date of establishment Total number of employees Types of business e ective along with the Gantt chart. It is obvious that the use of networks among public sector companies for PM is considerably low. Almost two-thirds of the public sector companies are not utilizing WBS and OBS for project planning, scheduling and control purposes. More e orts should be spent on resource leveling, especially with the lack and need for more con icting resources when dealing with multiple projects. Project control phase is not properly implemented. The analysis shows that a signi cant amount of time and money is wasted in project planning, but not enough e ort is spent in reporting and controlling. Therefore, the public sector should focus more on developing and implementing corrective plans. A high percentage of people use di erent commercial software, although it is not clear how e ciently these softwares are being utilized. Concerning the obstacles facing the e cient utilization of PM, and due to the lack of standardization in Jordan, cost estimation is a major obstacle. The consensus is that practicing PM e ciently would result in tangible bene ts in all aspects of planning, scheduling and monitoring the time, cost and speci cations of projects. However, from a practical point of view, implementing such management methods must be modi ed in every possible way to overcome the political, organizational and cultural obstacles. Developing countries, in seeking to enhance the implementation of PM, might capitalize on the experience gained in developed countries and adapted to their needs. During this transfer of technology process, developing countries must work on improving management skills, cultural and behavioral habits. Utilizing PM tools and concepts in Arab countries is one of the major factors a ecting the overall economy. Hence, more attention should be given to establish speci cations. The public sector should focus more on training their employees through attending conferences, seminars and continuing education courses. References [1] Stuckenbruck L, Asghar Z. Project management: the promise for developing countries. Project Management 1987;5(3):167±75. [2] Muspratt M. Conditions a ecting projects in less developed countries. Project Management 1987;5(1):45±53. [3] Codas M. Development of project management in BrazilÐa historical overview. Project Management 1987;5(3):144±8. [4] Cash C, Roberts F. Elements of successful project management. Journal of Systems Management 1992: p. 10±12. [5] Pinto J, Dennis P. Project success: de nitions and measurement techniques. Project Management Journal 1988;XIX(1):67±72. [6] Davies J. Using work breakdown structure in project planning. Plant Engineering 1995;6:54±6. [7] Badiru A, Pulat S. Comprehensive Project Management. Englewood Cli s, New Jersey: Prentice Hall PTR,1995. Ghaleb Abbasi is an Assistant Professor at the University of Jordan, Faculty of Engineering and Technology, I.E. department, Amman-Jordan. He holds a Ph.D. in Engineering Management and a M.Sc. in Construction Management from George Washington University, Washington DC and a B.Sc. in Civil Engineering from Cairo University, Cairo, Egypt. Abbasi has a wide experience in the public and private sectors and is a part time consultant for several organizations. He is involved in training and development programs especially in the areas of project management and the author of two books in that area. Hisham A. Al-Mharmah is an Assistant Professor in the Department of Industrial Engineering at the University of Jordan. He received a B.S. in Civil Engineering and an M.Sc. in Industrial Engineering from the University of Jordan in 1986 and 1990 respectively. He joined the School of Industrial and Systems Engineering at Georgia Institute of Technology in 1991, and received a Ph.D. in Industrial Engineering in His research interests include Engineering Statistics, Stochastic Optimization and Applied Probability.

LECTURE 8: Planning & Control Functions & Tools (Part II) Project Management BACA

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