Write an essay on Managing Engineering Projects?
The organizational structure, the product life cycle, communication, management of change and risk management plays a vital role in running an organization effectively and efficiently. It has also been found that if an organization runs effectively and efficiently, then it helps the organization to run profitably (Cooke, Tate and Cooke 2011). In this report, the present situation of the organization has been analyzed in order to understand its condition in detail and as per the analysis; recommendations have been provided in order to run the organization smoothly and effectively in the highly competitive market. In this particular report, the analyses of the business of the organization JCB have been done with respect to certain areas of the organization. In addition to this, the negativities of the specified firm JCB have been compared with its competitors (Competitive Benchmarking) with the aim to identify the proper ways in which the organization JCB can run effectively and efficiently in order to increase its profit percentages and the profitability ratios.
The particular market sector is highly competitive therefore, the analyses of the business of the organization JCB has been performed with respect to some specific areas. These include – the present organizational structure of the firm JCB, the current product life cycle of all the products manufactured by the particular firm JCB, the style and method of communication that is used within the organization. Additionally, the other areas that have been concerned for analysis in this report include – the process of implementing the changes within the firm and to manage the implemented changes i.e. the management of change and lastly to assess the risks involved within the operation and the regulation of the organization (Dinsmore and Cabanis-Brewin 2011). The main objectives of this report are to recommend the particular organization JCB regarding the changes that are required in its present organizational structure, position or stages of all its products that have been mentioned in the provided case study in their product life cycle, importance of communication in project management and the needs to change within the firm. In addition to these, the numbers of risks that the company faces have also been identified and recommended based on the analysis of certain areas of the firm for running the business successfully and profitably.
J.C. Bamford Excavators Limited is commonly known as JCB. It is a universally known company founded in the year 1945 and it is headquartered in Rocester that is situated in Staffordshire in the country United Kingdom (Jcbna.com 2016). Anthony Bamford is the Chair person of the particular company. JCB is a private company that belongs to the industry of heavy equipment. The main products of the firm JCB include – the Agriculture Waste Handling Machinery, Construction Machinery and Demolition Machinery (Jcbcard.com 2016). The organization JCB is a British multinational corporation and it has been considered as the third largest construction equipment manufacturer across the world. It has been found that the particular company JCB produces more than 300 types of machines. These include – excavators, diggers (backhoes), diesel engines and tractors. The specified company JCB has about 22 numbers of factories across the world; the countries include – Europe, Asia, South America and North America (Jcb.com 2016). It has been noted that the products of the firm JCB are sold in more than 150 countries. As per the annual report of the company JCB of the year 2015, the total revenue of the firm was £ 5.26 billion and the total numbers of employees working under the company across the world are about 18,000 staffs.
The organizational structure is defined as a typical hierarchical arrangement of communications, lines of authority, duties and rights of an organization. This helps in determining the process by which the power, roles and responsibilities of an individual are controlled, assigned and coordinated (Dinsmore and Cabanis-Brewin 2014). The organizational structure also helps in determining or identifying the method by which the information flows from various levels of management – it can be from top-level management to bottom level or vice versa. Therefore, in other words, it can be said that the organizational structure is defined as the method by which the activities such as – coordination, task allocation and supervision are directed for the achievement of the aims and objectives of the organization. This can also be termed as the viewing glass or the perspective by which the organization and its environment are viewed by the individuals.
As per the case study of the organization JCB, it has been found that in present the particular firm follows the following organizational structure:
From the above organizational structure, it can be said that the particular firm JCB follows a huge as well as a complex organizational structure. Therefore, various issues like – communication gap, misunderstanding, miscommunication, time consumption and organizational conflict are the very common problems within the firm (Dunne and Dunne 2011). The present organizational structure of the firm JCB indicates that the Managing Director of the firm, Mark Mumford regulates and operates the whole organization. He directly communicates with the Technical Director – Georgia Mumford, Production and Operation Director – Peter Mumford and Leadership and Logistics Director – John Mumford. Therefore, any decision taken by the managing director of the firm is directly communicated with the three directors and they individually communicate the decision of the managing director of the firm to the engineering manager, team managers (team manager 1, team manager 2 and team manager 3) and the sales and logistics managers respectively (Jcb.co.uk 2016). As per the present organizational structure of the firm JCB, the technical director is the middle person between the managing director and the engineering manager. For the manager team 1, manager team 2 and manager team 3, the production and operation director is the middle person between the managers and the managing director. And leadership and logistics director is the middle person of the sales manager and logistics manager and the managing director of the firm.
It has been found that further the engineering manager communicate the decision of the managing director to the supervisor and the other employees of the firm respectively. Similarly, the team managers also communicate the decision taken by the managing director to the supervisors of each of the three teams and then to the other employees of the department respectively. On the other hand, the sales manager act as the middle person who communicates the director’s message to the sales staffs and similarly, the logistics manager communicate the director’s message to the drivers (Gido and Clements 2012).
From the analysis of the existing organizational structure, it can be said that the present organizational structure is much large and complex. Thus, it takes much time to reach the managing director’s message or decision to the lower level management and employees of the organization as there are several middle persons who communicate the message. Therefore, there is a high probability that the director’s message might be modified and can affect the employees adversely. This negative effect might lead to the poor performance of the employees and the rate of productivity might also get hampered by lowering the quantity of production (Heagney 2012). Therefore, the particular firm should implement such an organizational structure that will be simple and the total numbers of middle persons will also be lowered in the structure in order to avoid any confusion, miscommunication and misunderstandings between the different levels of management and the employees of the firm.
A small and simple organizational structure can be recommended for the particular firm JCB, it is as follows:
Figure 1: Primary Organizational Structure
(Source: Dinsmore and Cabanis-Brewin 2011)
This above structure indicates that the CEO of the firm can communicate easily with all the primary departments of the organization within a short duration and thus, any miscommunication and misunderstanding can be avoided within the firm that might cause due to the increased numbers of middle persons. In this recommended structure, the CEO can easily communicate to the various levels of management and vice versa. Thus, both upward and downward communication can take place easily (Harrin and Peplow 2012). In addition to this, this recommended structure will help to reduce the duration of communication. Thus time consumption will be reduced in this newly recommended organizational structure. The role of the project manager within the firm JCB can be better understood from the following detailed organizational structure:
Figure 2: Project Manager Location in the Recommended Organizational Structure
(Source: Harrin and Peplow 2012)
The above organizational structure indicates that the president of the organization JCB can directly communicate with the finance department, engineering department, marketing department and purchasing department (Lock 2014). In addition to this, the president of the firm can also directly communicate with the project manager. Therefore, this newly recommended organizational structure will help the upper level management to communicate with the lower level management and vice versa easily. The simple structure will help to save time and thus various risks can also be decreased within the operation and regulation of the firm. Moreover, this structure is important for the organization JCB as the purchasing department is distinctly linked with the President of the firm and therefore the particular department can easily communicate with the president. Thus, the issue faced by the organization regarding the waiting period of seven days for the supply of the raw materials can also be abolished or reduced in order to run the business successfully within a high competitive market (Heldman 2011).
In order to run the business successfully, the firm can implement the more detailed organizational structure. This includes the following organizational structure for grouping the employees into every department. This grouping of the employees within a particular department helps in operating and regulating the business successfully (Morris 2013). The grouping of the employees into each department can be divided into two types, these include – functional grouping and divisional grouping as follows:
Image 4
From the above detailed organizational structure, it can be said that the functional grouping is composed of the departments as per its functions. Therefore, on the basis of the functions, the departments of the organization JCB have been grouped. Thus, as per the organizational structure based on the functional grouping, the CEO of the organization JCB is directly communicated with the engineering, marketing and manufacturing (Richman and Richman 2011). On the other hand, on the basis of the divisional grouping, the organizational structure of the particular firm is composed of product division 1, product division 2 and product division 3 that are directly connected with the CEO of JCB.
It has been found that most of the construction equipment manufacturer like Volvo, Komatsu, Caterpillar and Liebherr follow the mentioned Functional and Divisional Organization structure in order to run the business successfully in the high competitive market. The reasons behind implementing the divisional organizational structure within the construction equipment manufacturer industry are – firstly, this particular organizational structure is suited to fast change in any unbalanced environment. Secondly, this particular structure leads to customer satisfaction as the contact points and product responsibility are clear. The divisional organizational structure includes high coordination across all the functions (Richman 2012). This structure permits the units to adapt variances in regions, products and clients. Moreover, this structure is the most suitable and best option for the large organizations like JCB, Caterpillar which have many products. In addition to this, this particular organizational structure decentralizes the decision-making skill of the firm. Therefore, it can be said that the firm JCB should implement the divisional organizational structure in order to run the business successfully in the high competitive market. On the other hand, it has also been found that the organizations that have implemented the functional organizational structure have also been get benefitted from the structure. Therefore, the firm JCB should implement the functional structure as it allows the economies of scale within the functional departments. This structure enables the organization to develop skills and in-depth knowledge about the operation and regulation of the firm (Neal and Harpham 2012). It also enables the firm to achieve functional goals. Therefore, JCB should implement these functional and divisional organizational structures in order to run the organization effectively and also to increase the profit percentage of the firm.
The product life cycle is defined as a concept as per which the marketing of an organization takes place. A product life cycle is composed of various stages where every step of a product is mentioned through which the product goes from its initiation point until it is removed finally from the market (Silvius 2012). It has been found that all products do not reach the last or final stage of the product life cycle as the management of the company handles the product in such a way that it never declines and thus it continuously provides revenue as well as profit to the firm. The continuous growth of the product leads to rise in the income of the firm; otherwise the fall leads the firm to a loss making organization. It has been found that the product life cycle is composed of four stages – at first, introduction of a product, secondly, growth of the product, thirdly, the maturity or the stabilization of the product and lastly decline of the product (Roberts 2011). The product life cycle is represented by measuring time in the X-axis and by putting Product Sales Volume in the Y-axis. According to the provided case study, the firm JCB has various products but mainly names of some of the large equipments have been mentioned. These are – Back-loaders, Tele-handlers, excavators and forklift trucks. As per the case study, it has been found that the market of the particular industry is highly competitive and as per the company history, it has been found that the particular organization has been established in the year 1945 (www.jcbindia.com 2016). Therefore, it can be said that most of the products of the firm JCB are in maturity stage. According to the company website, it has been found that all the mentioned machines that are Back-loaders, Tele-handlers, excavators and forklift trucks are all in their maturity stage. Thus, each of the products of the firm is in the topmost position in the market in respect to its sales volume across the world (Wells and Kloppenborg 2015). It has also been noted that some of the mentioned machines like back-loaders and excavators have been modified by the firm for meeting the new demands of the customers. Therefore, in other words, it can also be said that the machineries back-loaders and excavators are in the growth stage of the product life cycle. Though, it has been found earlier that these two mentioned machineries once have reached their maturity stage and in order to retain the maturity stage of the product life cycle, the firm has modified its products in order to meet the growing demands of its clients.
Thus, it can be recommended that the firm JCB should keep a notice regarding the stage of each of its products in the product life cycle. Most of the products of the particular organization have reached their maturity stage and therefore, as per the thumb of rule, it can be said that the products might reach the next stage i.e. the decline stage within near future. However, if the products of the firm enter the decline stage, it indicates the sales of the firm will reduce and along with it the profit percentage of the firm will also decrease (Young 2013). Therefore, it can be recommended that the management should keep modifying all its products such that all of the products can be retained in the growth and maturity stages of the product life cycle. In addition to this, it can also be said that the organization JCB should deliver all its products in time and thus, the duration of the suppliers for supplying the raw materials should also be reduced or abolished in order to cope up with the high competitive market.
Communication plays a vital role in project management as the project manager is liable for guiding every aspect of a project. Therefore, it can also be said that a proper communication plan is necessary for making a project successful. By understanding the aim of the project, a proper communication plan helps the project manager to realize the goals and objectives of the plan (Dessler 2013). A proper communication is an important factor in project management as it helps to maintain consistency, helps to fulfil expectations, motivates the employees of the firm to increase the quantity of productivity and it also enables the manager to lead the team to the desired project outcome. As per the case study, it has been found that the particular company JCB Limited has a large and complex organizational structure. Thus, it has a several numbers of middle persons who help to communicate between the higher level of management and lower level of management team by passing on the information from one level to another. As the present organizational structure is complex and large, development of a communication gap is a common issue (Chapman, Ward and Chapman 2012). Due to this communication, both the upward and downward communication gets affected adversely. This negative effect due to the communication might create misunderstanding and miscommunication between the higher level managers and the employees of the firm (Hall and Knapp 2013). Thus, it can be said that the communication gap has a negative effect on the psychology of the employees and therefore, it also affects the overall performance of the employees. The negative effect on the overall performances of the employees implies adverse effect on the productivity of the firm. Therefore, it can be recommended that the present organizational structure of the firm JCB Limited should be modified or changed as per the requirement. The increased communication gap increases the distance between the management and the employees, thus it takes longer period of time to solve a single problem (Gaudenzi and Borghesi 2012). On the other hand, an increased communication gap might also create additional problems in the operation and the regulation of the business of the company JCB Limited. The increase in the communication gap increases the barrier in communication between the upper level of management and the lower level of management and even between the management and the employees of the organization. As the present organizational structure is large and complex any information or any message takes longer time to reach the bottom level of the structure from the uppermost level or vice versa. Therefore, it can be recommended that the organizational structure should be modified in order to make it simpler so that all the information and message can be communicated easily among the upper and lower level of management. As the communication gap changes or modifies the quality of the decision of the manager, it might have negative effect on the employees as well as the overall organization (George and Jones 2012). Another aspect is the issue of more time consumption due to the implementation of the Just in Time (JIT) process within the firm JCB Limited. As the market is highly competitive, time is an important factor and all these problems can be easily communicated to the upper level management if the communication becomes simpler among the lower and upper level of management. Thus, from these the importance of the communication in the project management can be better understood (Hopkin 2012). It can be recommended that the various barriers to communication should be reduced within the organization in order to improve the sales revenue of the firm and also to increase its profit percentages.
The organization JCB Limited could get benefitted from the improved communication in the project in various ways. Firstly, by modifying the organizational structure of the organization JCB, it can be made much simpler. This will help in easy communication between the upper level of management and lower level of management and vice versa. Secondly, all the various types of barriers to communication will be abolished or reduced (Hayton 2011). Thirdly, improved communication will lead the firm to take relatively lesser time in reaching any information or message from the upper level of management to the bottom level of management and vice versa. Therefore, any problems or issues or challenges that are faced by the employees and the management of the organization can be solved easily and also in shorter period of time. Fourthly, proper communication will reduce the communication gap within the organization among the upper level of management, bottom level of management and the employees (Meyer and Reniers 2013). Fifthly, improved communication within the firm JCB limited will help to maintain or withhold the quality of the decision made by the topmost level of management. Sixthly, either the improved communication will reduce or it will abolish any misunderstanding and miscommunication among the various levels of management and the employees of the organization. Seventhly, the proper and improved communication will reduce the time consumption and thus any problems can be solved much quickly (Lindholm et al. 2012). Eighthly, it can be said that the improved communication will indirectly improve the profit percentage of the firm due to the increased sales revenue of the firm. It will lead to increase in the market value and the product value of the firm. Lastly, it can be said that the improved communication within the firm will improve the organizational culture, organizational conflict can be reduced and all the risks of the firm can be managed easily.
As per the case study, within the organization JCB Ltd, various changes are required to implement. These include – firstly, the present organizational structure should be changed. The reason behind this is that the present structure is large and more complex so in order to avoid any confusion and complexity the organizational structure should be modified into a simple one. In a complex and large organizational structure, any information or message of the higher level of management takes longer time to reach the bottom level of management and employees. In addition to this, the quality of the decision also is modified. Therefore, in order to keep the quality of decision and information intact, and to reduce the time consumption and complexity of the present structure, new simplified organizational structure should be implemented within the firm JCB. Secondly, the just in time (JIT) procedure should be changed. The reason behind this is that the process just in time reduces the wastes within the firm but it makes the process slower and longer. Therefore, in order to make the process of production faster and to abolish the delays and late deliveries of the products to the clients due to delay in receiving the raw materials from the suppliers, new production and operation process should be implemented within the firm JCB. In addition to this, as the time is an essential factor and the particular market segment is highly competitive, thus, JCB should not get delayed in the delivery of the products as this will affect the firm adversely (Mondy and Mondy 2012).
On the other hand, as the products of the firm JCB are in maturity stage of the product life cycle, the product value as well as the market value of the firm is much high and these positives help the sales people to gain new customers and also to retain the existing customers. Additionally, on time delivery of the products to the clients also add value to the firm. Thirdly, the communication gap should be either reduced or abolished as this will bring improvement in the sales volume and profit percentage of the firm JCB. Fourthly, the risk management should be modified within the firm as improved and efficient risk management would lead the firm to run effectively, smoothly, successfully and profitably.
The process of change management should be considered and implemented within the firm JCB limited as per Kotter’s eight step change model. This particular model mainly has eight simple steps through which the change management can be implemented within an organization. These include – firstly, to increase urgency, secondly, to develop the guiding team, thirdly, to get the vision correctly, fourthly, to communicate for buy-in, fifthly, to empower action, sixthly, to develop short-term wins, seventhly, to do not let up and lastly, to get stuck to the changes made (Truss, Mankin and Kelliher 2012). However, it is a common factor that the employees of the particular organization will try to resist changes within the firm due to various reasons, like – insecurity in their jobs, change in their job role and changes in their pay structure and employment contract. Nevertheless, all these resistances to the changes can be handled by the project manager for the betterment of the organization and the employees by implementing four steps. These include – firstly, understanding the resistance and its primary cause, secondly, to communicate or to act in order to address the main cause. Thirdly, by paying attention to the requirement in order to act continuously and lastly, by providing mechanisms to spontaneously engage the mass population in the change, the manager can resist the changes within the firm (Rand 2012).
According to the case study, it has been found that the company JCB Limited faces various risks. These include – firstly, the communication gap between the upper and lower levels of management and secondly, time consuming factor for the process of supply of inventory. The present organizational structure of the organization JCB is huge and complex, thus it has a huge numbers of middle persons who pass the information or decision from one level of management to another. This results into modification of the quality of the decision made by the managing director and thus it affects the employees and their performances adversely (Robbins and Judge 2012). On the other hand, the increased communication gap results into increased level of misunderstanding and miscommunication. This might also affect the organizational culture and thus it can lead to organizational conflict. Therefore, it can be said that this risk of communication gap might affect the business of the organization JCB Limited adversely. On the other hand, the second risk is the prolonged period of 7 days that are taken by the suppliers of the organization JCB for supplying any parts of the machines like – cabs, hydraulics systems and engines. The present market of this particular sector is highly competitive. Thus, for this company, time is considered as an important factor as slight delay in the delivery of the products to the clients will increase the probability of the firm of losing its total numbers of customers.
Therefore, it can be said that time consumption for supplying the inventories as per the just in time process will affect the business of the organization adversely. In the high competitive market, the delay in the delivery of the products will result into increased amount of loss (Schermerhorn 2012). Even the brand value as well as the market value of the products of the firm JCB will decrease. This will result into decrease in total amount of sales volume, thus the revenue of the firm will also decrease along with the decrease in the total earnings of the firm. Therefore, it can be said that the customer satisfaction plays a vital role in the successful running of a business.
Thus, in order to mitigate these risks, the organization JCB Limited should implement modified organizational structure with the aim to decrease the complexity and communication gap between the upper and lower levels of management and the employees. The numbers of middle persons within the organizational structure should be reduced in order to reduce the time consumption for both upward and downward communications (Werner, Schuler and Jackson 2012). The misunderstanding, miscommunication and organizational conflict should be reduced in order to maintain a healthy organizational culture as well as environment within the workplace. In addition to this, new process of inventory should be implemented such that time consumption can be reduced as well as the quantity of the wastes can also be reduced and controlled. Moreover, the products of the firm JCB Limited should be delivered on time, such that the market value as well as the brand value of the firm can be increased. This will also act as a positive factor for the sales persons of the firm. The will also help to increase the sales revenue of the firm along with it the earnings (Collins 2011). Therefore, all the risks faced by the firm should be mitigated by implementing proper measures in order to run the business successfully and profitably. The risks can be measured through various models. However, these mentioned risks can be managed by implementing a five step model of risk management. The risk management model is as follows:
Figure 4: Risk Management Model
(Source: Collins 2011)
From the above model it can be said that the mentioned risks within the firm JCB Limited can be managed by implementing the five steps of this model (Clements and Gido 2012). These are – firstly, identification and analysis of the risks, secondly, the risk management techniques should be examined. Thirdly, accurate risk management technique should be selected, fourthly, the identified techniques should be implemented and lastly, the results will be monitored in order to run the business successfully and profitably (Cavanagh 2011). Therefore, it can be recommended that by implementing this risk model, all the risks that are associated with the organization JCB Limited should be managed such that efficiency of the firm can be increased along with its profit percentage.
Conclusion
Therefore, it can be concluded that the particular organization JCB Limited has various negativities with respect to certain areas like – organizational structure, product life cycle, communication, management of change and risk assessment. From the analyses, it can be said that the present organizational structure of the firm JCB should be modified and should make it much simpler. The time consumption should be reduced such that the time that takes for passing on the information and the decision from one level of management to another should be reduced in order to avoid any complexity within the structure. The management of change within the firm should be implemented in an orderly manner such that the organization runs effectively. The risk assessment identifies the risks that are associated with the firm and thus an accurate risk management model has been recommended to the firm JCB Limited in order to run the business profitably and efficiently. Lastly, in this report, recommendations regarding the present stage of the product life cycle of the product lines of the firm have also been provided in order to run the firm successfully in the high competitive market.
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