Please Use Below file as reference

Weekly Summary 4.1

Due: Sunday, End of Module by 11:55 p.m. EST

Each week you will write and submit a brief summary of the important concepts learned during the week. The summary will include a summary of the instructor’s weekly lecture including any videos included in the lecture.

Writing Requirements

• Use the APA template located in the Student Resource Center to complete the assignment.

ORGANIZING THE
INTERNATIONAL PROJECT

Chapter 6

THE CHALLENGE OF ORGANIZING AN INTERNATIONAL PROJECT

Purpose of organizing international projects:

 Reducing complexity by simplification of structure and
organizational design.

Forms of organizing an international project:

 Functional structure.

 ‘Projectized’ structure.

 Matrix structure.

 Virtual structure.

‘Organizing the project’ is a set of activities that have to be
finished in the planning phase of the project.

2

SELECTION OF SUITABLE PROJECT STRUCTURE

The following factors need to be considered with regard to the
selection of the most suitable

project structure

:

 Size and duration of project.

 Strategic importance of project.

 Novelty and need for innovation.

 Need for integration.

 Environmental complexity.

 Budget and time constraints.

 Project location.

3

Chief Executive

Head of Production Head of MarketingHead of R&

D

Functional

Manager

Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager

Project

Project co

ordination

4

Example of a functional

project structure

Chief Executive
Head of Production Head of MarketingHead of R&D
Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager
Functional
Manager

Project Manager

PM

Team

Member

PM Team
Member
PM Team
Member

Project

Team
Member

5

Example of a ‘projectized’ structure

Chief Executive

Engineer-

ing
Finance Marketing

Human

Resource

s

Others

Consul-

tants
Suppliers

Project 1

Operations

Controlling

Project 2

Project 3

Project
Manager

F
u

n
c

ti
o

n
a

l
re

s
p

o
n

s
ib

i

l

it

y

Project responsibility

6

Example of a matrix structure

CULTURAL IMPACT ON PROJECT ORGANIZATION (1)

Organizational structures have the following purposes:

 Help accomplish project goals.

 Provide project members with a frame of orientation, hierarchies, and
reporting lines.

Structures satisfy needs of belonging and esteem. Those can differ
between individuals, but also between national cultures.

Keep in mind the cultural embeddedness of matrix structures and
responsibility charts, both based on:

 Low power distance.

 Low uncertainty avoidance.

 Individualism.

 Strong task orientation.

 Strong achievement orientation.

 Sequential way of working.

7

Individuals from equality-oriented cultures tend to

prefer flat and lean organizational structures. People

from hierarchy-oriented cultures tend to favour

pyramid-like tall organizations with a high degree of

formalization and centralization.

Equality Hierarchy

Individuals from group-oriented cultures tend to work

better in permanent functional organizational

structures because of the continuity to work in the

same group. People from individualistic cultures tend

to welcome temporary organizational structures like

projects.

Individual Group

Individuals from cultures with high uncertainty

avoidance tend to welcome structure as an

orientation frame. They tend to accept precise

guidelines for co-ordination and rules. People from

low uncertainty cultures tend to feel at ease with

matrix organizations offering more flexibility, but also

ambiguity.

Embracing

risk
Avoiding risk

Individuals from status-oriented cultures tend to see

and use an organizational structure to show and

increase their personal standing. Tall organizations

with many hierarchy levels are preferred because

they offer good opportunities to be perceived as

important. In achievement-oriented cultures,

structures tend to be tailored to suit best

organizational objectives.

Achieve

ment

Standing /

status

8

Cultural impact on project organization (2)

INTERNAL AND EXTERNAL CO-ORDINATION OF AN
INTERNATIONAL PROJECT

Means of internal project co-ordination:

 Project office.

 Steering committee.

 Project champion.

 War room.

 Dual leadership.

 Minimization of interfaces and communication nodes.

Means of external project co-ordination:

 Systematic stakeholder management (see Ch. 3).

 Contracts
 Fixed price contracts.

 Cost reimbursement contracts.

 Incentive contracts.

 Informal means
 Institutionalized high-level meetings.

 Continuity in personal relations.

9

Project Manager

Quality Assurance

Controlling

Human Resource/

Change Management

Administration

Engineering Assembly

Logistics

Process

Reengineering

Software

Development

Manufacturing

Procurement

Project Management

Project Realisation (depending on the nature of the project)

Project Office

10

Example of a mechanism for internal co-ordination:

The Project Office

Firm Fixed Price

(FFP)

Cost Reimburse-

ment

Cost Plus Fixed

Fee (CPFF)

Incentive

Contracting

high

low high

Involvement

of customer

Degree of risk for customer

11

Contracts as special forms of external co-

ordination

CONTRACTS IN INTERNATIONAL PROJECT

S

It is recommended to use industry-wide global standards if
available.

A good starting point is the United Nations Commission on
International Trade Law (UNCITRAL).

It is also recommended to refer to INCOTERMS as a common
language and reference frame in order to reduce
misunderstandings.

12

PARTICULARITIES OF ORGANIZING INTERNATIONAL PROJECTS

Size of team:

 Due to the high heterogeneity of teams in international projects, bigger
teams are more difficult to manage than smaller teams.

 10 team members are considered as a suitable size (although this
depends on the nature of the project).

 Measures to keep teams small:

 Have several sub-projects.

 Create a core team and an extended team.

 Define team external contributions and outsource them.

 Keep team members only for specific project phases.

Using structure to overcome language and cultural barriers.

 Benefit from similarities in educational background and functional
language.

13

LINKING STRUCTURES, TASKS, AND PEOPLE

The structures provide the frame of co-ordinating the activities of
project members and stakeholders.

The Work Breakdown Structure contains all activities the project
members need to carry out in order to obtain the project result.

The responsibility chart of responsibility matrix combines structures,
activities, and people:

 On the vertical line, there are the activities taken from the WBS.

 On the horizontal line, there are the roles existing in a project. Basic
roles can be summarized by the RASIC system as illustrated on the
next slide.

14

esponsible

pproval

upport

nformed

onsulted

R

C

A

S

I

Responsibility

for work

Responsibilities

for management

Responsibilities

for communication

15

R I A

R S A

R C A

R C A
R C A

R A

R A
R A
R S A
R A
R A

I R A

C R A

R A

S R A

Assembly Function Tests

Generation of working plans

Material ordering process

Functions/Roles

Logistics

Manufacturing

Packaging

Returned Goods

Documentation – export

Specification and validation of packaging

S
u
b
-P

ro
je

c
t

M
g
r

B

Change Mgmt Assembly Drawings

Assembly Facility Layout

Goods Receipt

Warehouse Layout

Commissioning

Interim Storage

Dangerous Goods

Commodity Codes

M
a
rk

e
ti
n
g

P
ro

c
u
re

m
e
n
t

S
Q

P
ro
c
u
re
m
e
n
t

P
Q

A

R
&

D
T

D

L
e
g
a
l
A

ff
a
ir
s

S
u
b
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is

ti
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s
G

R
P
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je
c
t

M
a
n
a
g
e
r

S
a
le

s

Project: Production Transfer to China

PROJECT RESPONSIBILITY CHART

Sub-Project Description of work packages

R
&

D
M

a
te

ri
a

l
P
ro

d
u
c
ti
o
n
Q

A
P
ro

d
u
c
ti
o
n
A

s
s
e
m

b
ly

16

Example of a responsibility matrix