Essay: ORGANISATIONAL CHANGE – FACTORS AFFECTING THE PPM ADOPTION MODEL

Source: Ajjan 2008
In order for NETCO to adopt this new technology, they have to consider the environmental factors, technological factors associated with PPM and the underlining organisational factors in terms of areas/functions that will be impacted. The managers need to understand how this new technology will impact the organisational functions related to its strategy, HRM, operations/IT, marketing, finance and its processes such as communication, collaboration, learning, design and structure, coordination, control, power, politics, conflict, resolution, culture, and leadership.
ORGANISATIONAL IMPLICATIONS
ORGANISATIONAL FUNCTIONS
Strategy: Chandler (1962) and Andrews (1971) definitions of an organization’s strategy typically is thought of as an all-encompassing grand “plan”, with intentions of alignment between the organizational internal processes and structure, and the organizational external environment (Miles and Snow, 1978). Since NETCO’s main income stream is reliant on how projects are effectively managed, then, this technology is in alignment with their strategies and goals. The next line of action for the managers is to ensure that the technology also in line with the organisational external factors such as its competitors, clients, industry, government regulations and customers. NETCO will also gain competitive advantage if this technology is implemented accurately as there will be reduction in delays to projects thereby improving their client and customer satisfaction. A challenge will be time constraints in constant evaluation to certify that the portfolio management is in alignment with the organisations strategy.
Source: (Schuler 1992)
Human Resource Management (HRM): Effective human resources activities can serve as a unifying force in aiding an organization direct its strategic change (Schuler 1992). The human resource manager will serve as a link between the top management and the staff. Because this is a new technology, it is necessary that the human resource department equip the staff through training and testing. The HR manager will have to work closely with the project portfolio manager in allocating staff to projects based on their skills and the organisational strategy.
The workload of the HR manager will be when new projects emerge or when staffs are needed to be redeployed to another project.
Operations and IT: The adoption of this technology will definitely change the system of operations and IT in NETCO. The impact on this company will depend on the degree of process automation and process flexibility this technology offers (Fang et al 2013). Due to the current manual method of project management, NETCO’s operations were less automated and flexible. The Information Technology department had less impact on the automation of their tasks. But with this new PPM software, the IT department will have to work hand in hand with the operations department to ensure that the adoption and the implementation of this technology runs smoothly and provides the organisation with more flexibility in its operations. This new technology will also manage IT projects in the company. A major challenge in an organisation like NETCO will be the hardware and software compatibility of this new technology.
Marketing and finance: A good relationship must exist between technology and market development for any organisation or business to be successful. Technological innovation without proper market application will result in squandering of organisational resources and finance. Yet, long term marketing success cannot be attained without technological innovation (Kiel 1984). A significant change in NETCO’s marketing strategy will occur because of the adoption of this technology. With the hope that this technology will improve their project outcomes, the major marketing strategy will be to create awareness on their brand based on client trust and to build customer relationship through effective management of client’s jobs. A challenge in the finance will be the cost of purchasing this technology. With that said, more effective management of projects bring more profit, reduce waste, and boasts efficiency.
ORGANISATIONAL PROCESSES
Organisational Design and structure: The adoption of this technology will have a significant impact on NETCO’s organisational structure. PPM would result in fewer employees as there will be no need for employees to manually manage projects. It will bring about a reduction in the organizational levels of hierarchy (Dibrell et al 2002). Formal reporting relationships will change as the software provides employees with the ability to report online into a general project database. More so, the grouping together of individuals into departments will be based on their current project. The middle or line managers would not have a significant control over project allocation and coordination and outcomes. The sudden change in structure will bring about resistance to the adoption of this technology especially from the line managers hence this might bring pose a challenge.
Control, Power, Politics, Conflict and Resolution: The adoption of this new technology will create some conflict in control and power especially within the managers. Poor cooperation could arise from such conflicts therefore preventing the overall portfolio management to meet its set objectives. Allocation of critical resources and staff between projects may cause conflict between project managers (Sbragia, 1984). For instance, each project in the portfolio has a tendency to grow and become more autonomous and integrated making it more vigorous in meeting its set objectives but this could cause rivalry between powerful projects (Jonas 2010).
In many cases, each project has its own senior and high-ranking management members that try to force the demands of their own project (Lechler and Cohen, 2009). Project managers could be dishonest about their requirements and critical resources in order to gain priority (Elonen and Artto, 2003). Consequently, conflicts could arise if many projects use the same critical resources (Laslo and Goldberg, 2008). In order to prevent such, a higher management has to critically monitor the selection and prioritization of the projects to prevent projects blocking each other. Implementing coordination with a higher management could lead to another conflict as it will mean disempowering top managers and project to some extent. Due to this loss of authority, it is most likely that project managers will put up direct or indirect resistance which could lead to ineffectiveness, inefficiency, and poor PPM process performance (Jonas 2010).
Communication, Collaboration, Coordination and learning: PPM software will provide NETCO employees and team leaders the ability to effectively collaborate on daily tasks through an intuitive web interface, while managers and executives gain visibility into project, programs and portfolio execution, easily measuring progress against key business priorities. Time and distance will be collapsed as the employees can work from home and store their work on a general database provided by the PPM software. The connection of diverse teams in a collaborative environment improves organisational learning and sharing of ideas. However, effective coordination of collaboration should be in place as busy online discussion forums may lead to information overload. Also, another issue that might pose a challenge is employees sticking to the online communication and neglecting face to face interaction and physical group meetings.
Culture and leadership: An organisations culture can either drive or hinder an organisational change therefore the organisation’s culture should be considered for effective implementation of the proposed technology. A technology that conflicts with the organisational culture will be resisted by the organisational members causing implementation problems or failure (Cooper 1994). Currently, NETCO has a culture that embraces change in adopting new technologies hence the proposed technology will have to adapt to the culture. The leaders should also lead by example in maintaining this culture especially during the early stages of the technology adoption.