Business organizations are planning for strategic transformation in their business solutions provided to customers in the market. Strategic changes in business involve various factors including human resources and other external factors. Leaders in an organization play an important role in transforming business solution.
This report focuses on issues in the Strategic change in an acquisition of TBT. The scope of the project and deliverables are explained in detail related to the case study. This report deals with key issues in estimating and scheduling issues for this program.
This report outlines a justified risk management strategy for identification of risks and issues and mitigation strategies. A detailed review of programme management in an organization for key stakeholders has been provided. A critical analysis for evaluating the Programme Control approach has been done in the report.
Business change or transformation refers to the opportunity for defining a bold move in performing an incremental change in business. It provides an opportunity to rethink about changes in a business model for the development of the business in the market (Kerzner 2013). The change in the business model helps in maintaining a proper transformation in business solutions. According to a survey, 75% of the S&P 500 will turn over in the next 15 years. Big operational changes are being the den in various companies in the market. The projects undergoing the various project are facing many issues in their simulation die to act in proper transformation in business model (Burke 2013). Therefore, the strategic change in the business model is necessary for combining various factors of success with the operational dilemma of the company.
The strategic change in the business has been focusing on the change from the traditional method of business to a modern level of business solutions in the market the market of the business in various fields is changing due to change in customer demands and expectations. In this case study, DBCL is an international multi-disciplinary contracting and engineering organization. The company is structured on a functional basis but there are some challenges faced by the company regarding the deliverables updated in the project (Larson and Gray 2013). Therefore, this reflects a change in pressure in the Infrastructure Contracting Sector in which customers are looking for total packages including Private Finance Initiatives (PFIs) and Public-Private Partnerships (PPPs). However, there has been contractual conflicts in the company related to external providers including disputes that have been the costly and time-consuming process for the client (Fleming and Koppelman 2016).
Change in a business process has been a continuous process in an organization. Therefore, this process contains many issues in it. Some of these issues are mentioned below:
Significance
Organizational strategy helps in guiding all managerial decision in the boardroom. Different strategic plans help in mapping business processes for achieving goals and objectives of the company. Therefore, decisions made by them have created issues during any change in the organization. The projects have been interrupted by an illogical decision taken by management level of the company (Walker 2015). The change in the company has to be maintained by a proper organizational structure and daily involvement of employee. In this case, the team managers were not happy with several decisions taken by the management of DBCL.
Process
The change in process of corporate strategy of the company can be broken down due to various reasons and lack of processes including planning, implementation, monitoring and review. Managers used to prepare their strategic decisions during planning stage with concrete time-bound goals and objectives. However, testing and research are important in the planning stage as different managers try to acknowledge about information and data for the validity of change (Leach 2014). The implementation stage of the project deliverables helps in providing the proper analysis of project work. Monitoring of project processes provides the continuous change in the project. These help managers in gaining information about the procedure followed by the project. The review stage maintains analyse data gathered from monitoring different tasks and decide whether the strategy requires any change or not (Fleming and Koppelman 2016). Therefore, these steps help in maintaining all processes of the project, in this case, the managers are not able to maintain a proper support for the project team and managers.
Communication gap
The success of the project depends on communication among team members, manager and high level of management. Therefore, lack of communication creates issues in any kind of change in the organization related to the project. Communication helps in maintaining a transparency in the work procedure of the project (Liu et al. 2016). A proper communication skill of manager helps in maintaining a professional work environment. A manager has to maintain a proper communication with team members and understand their feelings and thoughts regarding the completion of the project. Middle-level manager faces a lot of issues and challenges during the change process.
The company have acquired a Highway Engineering project that on Contractual division. Therefore, the company have decided to insource completely for providing proper services to clients and customers in the market. The strategy for insourcing this approach reflects urgency in improving delivery ad its main infrastructure (Nicholas and Steyn 2016). Therefore, DNCL has acquainted an organization named as TBT, which has its headquarter in North America. TBT is one of the leading organization in this sector and has expertise in growth and development of projects under it. However, it also created challenges in the projects. The cultural environment is different from that of DBCL. Therefore, it creates cultural issues in cooperating with functions in support of engineering global operations. The work environment of the TBT has been creating potential issues in the work environment of the company (Martinelli and Milosevic 2016). The project management process has helped in mitigating these issues in the project. Project management is a process, methods and knowledge that helps in maintaining a project and achieve experience for achieving goals and objectives of this project.
Figure 1: Project Organization Components
(Source: Newton, Greenberg and See 2017, pp. 134)
The use of the Portfolio project management might help in maintaining all process in the project. It is a centralized management of projects for ensuring allocation of resources to projects and greatest value to the organizational goals.
The programme Impact matrix helps in identifying the impact of the external factors in the project. It can be divided into the high level, medium level and low level of impacts. It helps in the decision-making process for creating strategies for risk mitigation activities. In this case, this matrix has helped in identifying the risks and issues involved in the Highway Engineering project in the company (Newton, Greenberg and See 2017). The issues created by an association of the TBT in the project have been addressed with this impact matrix.
Figure 2: Programme Impact matrix
(Source: Rocha et al. 2016, pp. 29)
Figure 3: Establishing a programme
(Source: Adekola and Sergi 2016, pp. 49)
Scope
The scope of the programme is to analyse some of the products, services and results that are included in the project. However, there can be some change in the scope of the programme. The change in the scope requires the change in cost and schedule of the project.
Definitions
Statement of Work: This statement is a narrative description of products and services and is delivered by the project. However, it is the main body if the contract that includes all the deliverables and details of other terms and conditions (Adekola and Sergi 2016).
Work Breakdown Structure: It is a hierarchical decomposition of activities and tasks included in the project. It provides the time scale for the team members to complete goals and objectives of a project within a deadline.
Figure 4: Work Breakdown Structure
(Source: Geppert, Matten and Williams 2016, pp.11)
Requirements refer to the method that the project team will use to identify, analyse, document, and manage the project’s requirements. A proper planning is required for the fulfilling requirements of the programme. The process of documenting, managing and determining the requirements of the programme refers to the collection of requirements (Geppert, Matten and Williams 2016). A proper analysis is required for meeting objectives and goals of the project. There are various techniques by which requirements can be collected for the programme including interviews, surveys, and facilitated workshops, brainstorming and benchmarking.
Various steps are included in estimating programme and project resources and schedule:
Project Estimating Guidelines
Allocating responsibility to an individual most familiar with the task
Figure 5: Top Down vs Bottom Up
(Source: Kleinaltenkamp, Plinke and Geiger 2016, pp.19)
Budget estimating
The work package helps in estimating the resources included in the project. Therefore, this process can estimate the cost of each resource (Buil, Catalán and Martínez 2016). Budget control helps in estimating interaction costs, changes in project scope and plans, normal conditions not applying and tasks going wrong.
The company have faced loss in their business with around 10% due to this project. Therefore, the company have decided to close down this project. The capital invested in this market has been totally wasted and unprofitable. The stakeholders were not ready to invest any more in this project. Therefore, there was the financial crisis in the company due to this project. The challenge was that if the reject continues, the company would remain in a loss and might shut down gradually. Therefore, the closure of the project had become necessary for the company. The disposal of equipment and other resources have already been in a loss for the company (Trivella, Nasiopoulos, and Trivellas. The manufacturing operations were based in Scotland and there was likely to be significant resistance from numerous stakeholders not least the employees. However, the closure of the projects has not been acknowledged to the stakeholders of the company and it has become the first priority for the company.
The risk management process includes identification of risks involved in the project. The risks management process includes proper analysis of identified risks in the project. The risks involved in the project has been listed below:
Loss of knowledge and expertise
The lack of skills among team members of the project. This lack of skills and training of the team members have created various issues in the procedure of the project (Cokins 2017). However, these risks are properly analyzed with the help of risk management strategies.
The difference on the perspective of supplier and customers have created risks of the company to maintain the programme. The cultural differences have also played an important role in increased risks for the programme. The perspective of the supplier has been continuously conflicting with a perspective of a customer (Racz-Akacosi 2017). The supplier is creating the delay in providing raw material and resources for the programme. However, a customer is asking for fast delivery of the products and services in the market. Therefore, there is a huge conflict between the perspective of customer and supplier.
Sales – Delivery Gap
The risk of delivering products and services of the company has been creating challenges. The company has already closed the project that has created problems in maintaining the balance between customer and suppliers.
Overuse of change control
The company has not able to maintain the change management in its operations that created high-level risks. The control over the change has been poor for the company (Cullen 2017). This was one of the major reason for the closure of the Highway Engineering project. The maintenance of change in the programme was not scheduled within the deadline.
Conflict
There has been conflicting among team members, managers and top-level management in the company. This has caused various causalities between them. Communication between middle-level managers and top-level managers has been a major issue in the organisational structure (Jacobs. and Chase 2017). This situation has created a high-level risk for the programme.
The aim of the risk management is to ensure that the DBCL Company has an effective procedure for decision-making by thorough analysis and understanding of risks involved in the programme. The risk management strategy includes raising awareness for the need for risk management, minimising loss, disruption, damage control and reducing the cost of risk. The risk management strategy has to be under various policy and regulations that helps in maintaining a proper strategy.
|
Cabinet |
· Approving the risks management strategy · Approving the Strategic Risk Register · Monitoring progress in the management of Strategic Risk |
|
Audit and Accounts Committee |
· Ensuring that the Council has an effective risk management process · Monitoring progress in the management of Strategic Risks |
|
Leadership Team |
· Determining Council’s risk appetite · Identifying strategic risks · Determining actions for managing strategic risks · Monitoring progress in managing strategic risks |
|
Service managers |
· Supporting Leadership Team in identifying and managing strategic risks · Managing operational risks effectively |
|
Employees |
· Identifying risks · Implementing actions as required |
|
Head of Governance |
· Ensuring that the company has an effective risk management framework |
|
Risk and Resilience Manager |
· Developing and reviewing risks management strategy and process with proper guidance · Providing advice and support to leadership team and Service Managers on identification and analysing risks · Identification and progress of strategic risks for Audit and Accounts Committee · Providing risk management training required by managers and officers |
|
Internal Audit |
· Providing advice and guidance on the management of risk relating to design, implementation and operating systems of internal control |
Table 1: Roles and responsibilities of different management level regarding risk management strategy
Figure 6: Risk Management Methodology
(Source: Godwyn 2017, pp. 53)
Risk Impact Analysis plays an important role in identifying the severity level of different risks in the company. There are impact scores provided in the table that helps in identifying the priority level of risks.
Figure 7: Risk impact analysis
(Source: Doppelt 2017, pp. 67)
The historical significances state that the company has always been in the loss during any change in its operations. However, the company have seen many changes in its operation related to the manufacturing department of the company. The closure of the manufactory factory in the company has caused various effects of stakeholders. The main challenge in retaining this project was that it would require more investment and capital equipment for the factory. However, the stakeholders have not been yet acknowledged about the closure of the manufacturing factory. The Company have acquitted with a new company named as TBT for maintaining construction project. This might help in returning capital invested by the stakeholders (Barry 2017). The stakeholders have been informed about the situation for maintaining a clear communication with them. Proper communication with the stakeholders has helped in ensuring them about the safety of their capital investment in the company and project. The savings done by a closure of manufacturing unit of the company have been invested in the acquisition of TBT. This has helped in maintaining the budget if the programme that has been started by the company with respect to completing this project (Ramdhani, Ramdhani and Ainisyifa 2017). The support of stakeholders has improved change management of the company.
Figure 8: The Project Stakeholder Management Cycle
(Source: Wheelen and Hunger 2017, pp.123)
A two-way communication with the stakeholders with various means including leaflets, emails, workshops, newsletters and meetings. This helps in maintaining a proper relation with stakeholders of the company. Acting on feedbacks of the stakeholders of the company is necessary for retaining a healthy bond with them. Feedbacks of stakeholders are necessary for the development of the company and project.
Programme Management refers to the management of different projects by different activities for achieving beneficial change. However, programs are complex than that of multiple projects. Therefore, it creates difficulties in managing programs in an organisation (Nguyen and Watanabe 2017). The main processes included in programme management are mentioned below:
Project Coordination
Coordinating projects involve various functions and operations including identifying, accelerating, initiating, redefining, decelerating and terminating projects within a programme. It helps in maintaining a proper approach towards procedure selected by the project for its completion. The project coordination helps in managing interdependencies between projects and between projects and business-as-usual activities (Rajablu et al. 2017). Therefore, team members of the company follow a proper methodology for the project.
Transformation
Transformation in the business scenario is important for a company to maintain a proper work environment. The outputs and results of the project and managing them helps in changing business-as-usual for proper delivery outcomes.
Benefit Management
Managing programs require various stages for clearing out the benefits from it. These steps include defining, measuring, quantifying and monitoring benefits from the program. Therefore, benefits management helps in quantifying outcomes and results of programmes.
Stakeholder management and communication
Stakeholders are key assets for the company in the market. Stakeholders play an important role in the development of the company by investing capital in functions of a company (Cokins 2017). A two-way communication with stakeholders of the company help in maintaining a transparency regarding operations of the company with them. Therefore, stakeholders are ensured about their financial investment in the programme.
Portfolio Management
Portfolio programs are those, which enable grouping of projects, which are relatively independent of one another but have a common theme. The theme might be common resources that are related to the benefit of the case study provided in the report. The project definition can be amended for enabling additional benefits for more functionality in development of a new program. Managing Successful Programmes (MSP) is one of the ways of managing programmes.
Figure 9: Managing Programs Process
(Source: Barry 2017, pp.165)
Programme Impact matrix
|
Predictability of Outcome |
||||
|
Focus on the Change |
High |
Medium |
Low |
|
|
Specification-Led |
Major Engineering Programme |
New Organisation wide ERP |
Unproven Technology Implementation |
|
|
Business Transformation |
Adoption of a well-understood approach |
Changing existing working practices |
Diversification into new markets |
|
|
Political and Societal Change |
Increase to an investment programme |
Change to a public service delivery model |
Changes to societal values and behaviours including reducing long-term unemployment. |
Table 2: Programme Impact Matrix
Project Control Cycle
It aimed at defining various problems and risks involved in the implementation and removing them. The team members have to start the testing of the programme. However, planning is the initial stage of project implementation. The team members of the project have to make their plan before any problem arise (Buil, Catalán and Martínez 2016). The second stage is control and team members used to implement their plan and identifies their loopholes in a project. The next stage is project control. The developers used to measure negative factors of the project. The last phase of about conduct assessment for project performance.
Figure 10: Project Control Cycle
(Source: Barry 2017, pp. 235)
Milestones are stages and events that are acquitted with the main project for the significant accomplishment. There can be the various milestone in this project. Some of them are mentioned below:
Business processes and functions are transferred from one business to another on some contractual basis. Therefore, a proper contract is required for a safe and secure transfer. Outsourcing of business processes involves various services including networks, data centres, application services, financial services and legal processes (Jacobs. and Chase 2017). This may include small and large projects of the company.
|
Drivers |
Mechanism |
|
Lower cost |
· Competition · Expertise · Experience · Risk transfer · Labour arbitrage |
|
Faster Completion |
· Expertise and Experience · Systems, processes and tools |
|
Flexibility |
· Use of external resource pools · Remove internal resource constraints · Ramp up and down for projects more easily |
|
Better Quality |
· Experience and expertise · Systems, processes and tools · Better risk management · Rigour imposed by contract |
Table 3: Outsourcing Drivers
Fixed Price
A fixed price contract focuses on estimation of effort and assessing risk confidently. However, the payment amount does not depend on the use of resources in the project. This contract provides a price that is not included in any kind of adjustment (Buil, Catalán and Martínez 2016). Therefore, this contract imposes the burden on contracting parties with the maximum risk involved in cost escalations.
Shared Risk
A shared risk model helps in offering an alternative towards traditional contracts. However, it helps in providing a pricing structure including additional payment details in the success of project criteria. Various benefits are included in the shared risk model including payment is focused on various project value, project objectives are aligned and providing enhanced quality of outcomes for transformational projects.
T&M
This contract seeks for both internal and external advice related to legal consequences and influences. This a contract in, which a contractor is paid on the various basis including original cost of direct labour, usually at specified hourly rates, Original cost of materials and use of equipment and agreeing upon fixed add-on for covering contractor’s overhead and profit.
However, in this case, the company have used the shared risk contract for contracting with TBL for this project (Kleinaltenkamp, Plinke and Geiger 2016).This model might help in providing a flat structure of price included in the project with proper deliverables. Therefore, this help in maintaining the clear overview of the terms and conditions included in the project.
Agile contracts are fixed price contracts that focus on the agreement with supplier and customers of IT projects for developing agile software by using agile methods. The model introduces an initial test phase after which budget, due date, and way of steering scope within a framework are agreed upon.
As commented by Kerzner (2013), agile model deals with a team working on a project that includes directional changes. On the other hand, Cokins (2017) argued that directional changes are not possible in the Waterfall model. Once a component is completed, extra development stages might take place with a component. This helps in managing and delivering outcomes of the project within a deadline. The agile model uses incremental steps for completing a project and include feedbacks of the customer for testing and other adjustments. The quality increases within Agile projects due to developers using a working system that aids them in detecting errors sooner, rather than at the end of each stage. On the other hand, Nicholas and Steyn (2016) argued that it becomes difficult for laying out the requirements of the project at beginning of software development cycle. However, there is also lack of emphasis on necessary documentation and designing. This creates the problem as only senior managers can take decisions during developing processes of the project.
Figure 11: Agile Workflow
(Source: Kerzner 2013, pp. 113)
The waterfall model is a time taking the process as the feedbacks of the customers are taken in every step of the project. The waterfall method is used when requirements of the project are well defined with various sets of tasks and objectives with the help of development team. However, there needs not be any change during the developing process of the project. A tight budget is maintained in this process for completing the project on time. The waterfall model helps in providing discipline to the task and completed within the deadline.
Figure 12: Waterfall vs Agile Model
(Source: Komai, Saidi and Nakanishi 2016, pp.1707)
However, in this case agile method can be used for completing the project. As commented by Komai, Saidi and Nakanishi (2016), the agile model is faster than the waterfall model. In the case of the waterfall model, testing is done at the end of the project. On the other hand, testing begins before development in an agile model. In the case, if agile model, testers and developers used to work differently as testing is done at the end of the project. As argued by Palmquistet al. (2013), in the case of agile model testers and developers used to work together as testing is done at each step of the project. The waterfall model deals with managing tasks in their own way. However, in agile model team ownership is required to complete the project. Therefore, it is justified that the agile model is required for completing this project.
Figure 13: Project management frameworks
(Source: Palmquist et al. 2013, pp. 93)
Conclusion
It can be concluded that the board members of the DBCL lacked in maintaining proper ethical duties at management level. The savings from the disposal/closure were going to be used to help fund the acquisition of TBT. The cost and investment savings were essential to build resilience and remove cost from the business. It is anticipated that closure will take 12 months. The company has already been running in loss due to various failed changes in the company. DBCL has been facing failure in making changes in the operations of the company and its structural coherence.
The company have to focus on developing strategic change management in their operations.
Training
The company might arrange training sessions for their current employees. These sessions might help in increasing their skills and knowledge regarding a strategic change in the company.
Motivation
Motivated employees can provide better performance than unmotivated employees do. Therefore, Leaders and managers have to motivate their employees and workers in their workforce for providing enhanced results from this project.
Project management
The company needs to acquire knowledge regarding project management programme. The company requires implementing project management strategies for minimizing risks in the project and success in completing this project. Therefore, the company have to practice various frameworks related to project management.
Figure 14: Recommendations
(Source: Created by Author)
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