Supplier project objectives management ©

Closing the gap between project and organisational success at the project supplier

As introduced in the book Project Objectives Management, this website contains a new dedicated method for suppliers of a project, Supplier project objectives management, to manage supplier objectives effectively to align project and organisational success within your organisation, now and in the future.

The first section Now describes a current reality of managing project objectives at a supplier of projects, where projects provide less or limited benefit for its organisation, identifying the gap between project and organisational success at the project supplier.  

The second section Future describes a future reality of managing project objectives within the organisation and its project execution practice of a supplier of projects, where projects provide the most possible benefit for its organisation.  

The third section Supplier perspective further investigates the customer perspective on project objectives and based on analysis develops the opposite supplier perspective on project objectives within projects a the supplier of a project. 

The fourth section Generic objectives introduces the ten generic project objectives within the dedicated method. Combined with the supplier perspective these generic project objectives form the basis of the dedicated method for project suppliers to manage project objectives effectively within their organisation. 

The fifth and final section Method introduces the new dedicated method for project suppliers to manage project objectives effectively within their organisation and its project execution practice, to close the gap between project and organisational success at the project supplier, to provide the most possible benefit for its organisation, to secure its future.  

Now

This section Now describes a current reality of managing project objectives at a supplier of projects, where projects provide less or limited benefit for its organisation, identifying the gap between project and organisational success at the project supplier. 

Various relevant definitions, such as project (management), project success (success factors and success criteria) and project objectives are analysed. Next the conventional definition of a project objective is studied, identifying the biased customer perspective on project objectives, and the absent supplier perspective on project objectives. The absent supplier perspective is referred to as the gap between project and organisational success at the project supplier. This absent supplier perspective combined with the conventional goal of commercial companies to make money, can result in various problems at the project supplier to achieve benefits from their projects for their organisation.

Project (management), success and objectives

Project and project management

Various definitions exist of projects and project management. [1]

A project is a temporary endeavour designed to produce a unique product, service, or result with a defined beginning and end, usually time-constrained, and often constrained by funding or staffing, undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value.

Project management is the process of leading the work of a team to achieve goals and meet success criteria at a specified time. The primary challenge of project management is to achieve all the project goals within the given constraints. The secondary challenge is to optimise the allocation of necessary inputs and apply them to meet pre-defined objectives.

Project success, success factors and success criteria

Two very useful distinctions exist in literature on project success. [2]

Firstly, a distinction is made between project success 'criteria', outputs against which success or failure of a project is measured, and project success 'factors', inputs into the (project) management system leading directly or indirectly to project success. Project success factors are crucial for analysing why projects are a success or a failure but cannot be used for measuring the actual degree of success, which is the domain of project success criteria instead. Certain outputs of a project, such as achieved project objectives (a measurement of project success criteria), might lead in turn to inputs into a future project, being project success factors (inputs that lead to project success of that succeeding project), such as acquiring useful process assets or lessons learned.

Secondly, a useful distinction is made between measurement of 'project' success criteria, measured against the performance on overall objectives of the project; and measurement of 'project management' success criteria, measured against the performance on project management objectives –later defined as the 'project controls' – such as cost, time, quality, organisation and information. Project success deals with goal and purpose, project management success with inputs and outputs. These overall and project management objectives together constitute the project objectives, which provide a measurement of success of the project. Note that this distinction also indicates that a project can still be a success overall, despite poor project management performance, and vice versa.

Project versus organisational success

Project and organisational perspectives on link of project objectives to project and organisational success. [3] Project objectives are linked to project success by being its measurement (the project perspective). Project objectives are linked to the organisation and its organisational success by business benefits (the organisational perspective). However, although organisational success might be linked to project success by project objectives and its business benefits, it is not necessarily a direct or instant link in general. How does this link actually looks like at organisations involved in the project?  

Project and organisational success diagram

Figure 1 represents all elements as analysed above in one diagram, including project versus organisational success. 

Figure 1 Project and organisational success Diagram [3]

Customer and absent supplier perspectives

Conventional definition of a project objective and customer perspective

Various definitions exist of project objectives, such as the following typical conventional definition. [4]

In project management, a project objective is a business benefit that an organisation expects to achieve, as a result of injecting project product(s) into itself or its environment.

The term 'business benefits' refers not only to strictly monetary gains, but to all kinds of changes in parameters describing the workings of any organisation that bring it closer to its goal.

Customer and supplier perspectives

This conventional definition of a project objective leads to the customer and supplier perspectives on project objectives. [3] Although this definition uses the generic term 'organisation', it is evident from the fragment 'injecting … into itself or its environment' – which refers to a receiving party in the project – that this organisation is clearly the receiver of the project, and therefore is the: 

• customer and user combined when injected within itself, or; 
• customer when injected within its environment and used by the customer's user. 

In both cases however the generic 'organisation' refers in fact more specific to the customer or user. The customer or its user gains business benefits as a result of injecting the project products into itself or its environment. Other definitions of project objectives in literature represent a similar bias on the customer or user of the project. [5] This existing bias to the customer or user of the project product is referred to as the customer perspective.

The customer or its user gains business benefits – in fact, it gains instant business benefits – as a result, a direct result, of injecting the project products into itself or its environment. Project business however, and more specific a respective project, involves both a customer and a supplier of the project (results). Two parties; either linked by a contract or agreement between two separate organisations (supplier and customer), or an internal project delivery by an executing department to a using department (supplier and user) within an organisation.

Absent supplier perspective

Looking back at the conventional definition of a project objective. Where is this other party, the supplier in the definition? This absent perspective, opposite to the customer perspective is the supplier perspective.

The project supplier, as opposed to the customer, has no direct products to inject within its own organisation, and therefore cannot itself gain instant business benefits from its product. It seems that the supplier can only gain business benefits as an indirect result of delivering the products to the customer. (Figure 2)

Figure 2 Project objectives of a project at customers versus suppliers [3]

With this absence of a direct link between the product delivery and business benefits at the supplier, project success might not directly lead to organisational success at the project supplier. This explicit focus on the organisation (the customer or user) that implements the project product(s) within itself or its environment, and the absence of the other organisation (the supplier) that delivers the project result and its absent direct benefits, is characteristic for this existing, conventional definition of project objectives: it represents a customer perspective and no supplier perspective on project objectives. In line with this absence of a direct link between project actions and business benefits at the supplier, project success might not directly lead to organisational success at the project supplier. [3]

Despite various examples of studies involving project success, project objectives and project suppliers, explicit studies of a perspective from the supplier of the project, on project success criteria and project objectives – as opposed to a perspective from the customer – remain rare in the project management field. This absent supplier perspective on project objectives, is referred to as the gap between project and organisational success at the project supplier. [3] 

The conventional goal to make money

Although not stated explicitly in the conventional definition of a project objective, it should be no surprise that for most commercial companies the main goal is to make money. And, where non-commercial organisations likely have another main goal, managing their funding versus cost remains of major importance to their continuity. Eliyahu M. Goldratt was an influential Israeli business consultant and originator of various well known and successful process and production techniques, such as the Theory of Constraints, The Thinking Processes and Drum-Buffer-Rope. As part of his theory Goldratt defined in his book The Goal that. [6]

There is only one goal, no matter what the company. The goal is to make money. Everything else is just a means to achieve the goal.

Many companies, researchers and authors in the field do claim different ultimate purposes or goals of a commercial company, however it is justified to conclude that money is at the forefront of day-to-day operations of any organisation. Even non-profit organisations have money as an important constraint as well, to be able to run their organisations. Making money seems the conventional goal of commercial companies, but is it or should it be the ultimate goal? And is it the best goal for a company? (Figure 3) [3]

Figure 3 Conventional goal of commercial companies to make money [3]

Problems at the project supplier

Worst case problems of a biased customer perspective and an absent supplier perspective on project objectives combined with a conventional main goal to make money at companies, are further investigated at a typical project supplier most affected by such effects, characterised as: [3]

• a for-profit (commercial) company;
• delivering projects to an external customer (organisation);
• a multi-project environment with limited resources (e.g., human resources) for all ongoing projects;
• small to medium sized;
• without extensive and matured organisational project management procedures embedded within their organisation to manage their projects;
• or growing fast in size or revenue;
• or operating in a turbulent, continuously changing business field;
• or operating in a highly competitive business field.

Providing less than possible or even insufficient benefit [3]

The bias towards the customer perspective and absence of a specific supplier perspective on project objectives might lead to less awareness of the fact that with an absence of such a direct link between all potential project objectives and business benefits at the supplier, project success might not directly lead to complete organisational success at the project supplier. Or in other words, less awareness that something else might be required or available. This is the gap between project and organisational success at the project supplier. This lesser awareness might in turn lead to circumstances with less focus on all available benefits for the supplier, and thereby the project might not provide the most possible benefit for the supplier itself; thus, providing less than possible or even insufficient benefit from the project for the project supplier itself.

This bias towards the customer perspective can be found within most used project management methods as well. Usually the project, the project manager and the project team officially start from a project initiating document, sometimes called the project initiation document, or Project Brief within Prince2 or Project Charter at PMI. This project initiation document, the way the project manager executes this and how the organisation rewards this, usually tends to focus on customer focused project objectives and project controls (such as cost, time, quality, organisation, and information), which align with his day-to-day operations; and tend to focus less on its own supplier focused project objectives or benefits. Although benefits such as acquiring process assets, lessons learned or training of employees is or might be a focus in many organisations including project suppliers, it might still be ad hoc, incidental, or perhaps driven by certain personally motivated employees only; and usually such objectives are not included in the project initiation document.

In practice, despite having a formal project initiation in place, stakeholders tend to address new expectations or objectives – which were not included (yet) in the initiation document – to the project team, whenever they arise during the project. Which is good in a way, better late than never if they are valid, however it is not structured and therefore disruptive to the project, and the surprise part of it could be avoided. I do however not conclude that project initiation documents and project management methods are wrong. They do aim at the primary and important objective of the project to provide the project product(s) as per user or customer expectations and pursuing the project controls, which is good. There is however something missing related to the benefits from the project for the supplier organisation. And even without a biased project initiation document, it is natural for the project manager or the project team to focus on their project alone, and not immediately at the benefit of other projects within their organisation.

Part-time project team members [3]

A typical feature of small to medium sized projects is that part of its project team members are only part-time assigned to the project, and part-time work on other projects as well. And when a team member is not full-time working on the project, commitment can never be fully for that respective project, which can have a significant impact on the success of the project. Therefore, also team and commitment building is more challenging within the project team, in case of part-time project team members.

Added value [3]

 Even without structural and active management of project objectives during the project execution, the customer is usually provided with a significant number of possible business benefits after implementing the project result within its organisation. However the project supplier instead, without active management, could be left with minor possible business benefits. In that case, the project supplier does have the problem that less or minimum added value is being transferred from the project to the organisation.

Misalignment between organisation and project regarding continuous improvement [3]

Within many organisations there exists a misalignment between the organisation and the project (team) regarding continuous improvement. Where the organisation and sometimes its specific organisational department tries to focus on continuous improvement through interaction with the project teams, usually by introducing (new) initiatives or procedures that the project teams have to adhere to, the project teams are troubled by more urgent (other) challenges and objectives in their day-to-day activities. It has to do with the difference between importance and urgency. Urgent topics and problems take most of their daily focus and time, while important topics and problems, such as continuous improvement of their organisation, is left with little remaining focus and time.

A core quadrant analysis of 'innovations' [3]

A core quadrant analysis of 'Innovations', identifies the respective core quality, pitfall, challenge and allergy that can challenge a project supplier. (Figure 4)

Figure 4 Core quadrant analysis of 'Innovations'

A current reality tree of 'process assets' [3]

When an organisation has executed several projects during a certain period, usually some experience and lessons learned from those projects might lead to templates, procedures, or guidelines (also called process assets) that can be re-used on a new project, instead of starting from nothing. The degree however to which such useful process assets become available can vary from nothing or limited to a very high quantity or quality. Worst case, there is no lessons learned process in place to learn from former projects, and no development and re-use of any process assets, an extreme case of 'providing less than possible or even insufficient benefit from the project for the project supplier itself'. A worst-case reality of process assets within a project supplier, is studied by a current reality tree (CRT) (Figure 5), by use one of Goldratt's Thinking Processes, part of Goldratt's theory of constraints (TOC). [7] The complete CRT can be found in below chapter Appendix. Navigate through this CRT diagram by starting at the bottom on page 1 and follow the various elements, such as the starting point (9), assumptions and statements (e.g. 1, 4 and 5) upward through the diagram (upwards through pages 2, 3 and 4) towards various undesired effects (UDEs) and the main UDE (51) at the top of the diagram.

Figure 5 Top, centre and bottom part of current reality tree (CRT) analysis of 'process assets' [3]

Less other benefit due to primary focus on commercial objectives [3]

In addition to his initial definition, E.M. Goldratt adds in his book The Goal that the goal of a company is. [6]

to make money now as well as in the future, with necessary conditions, boundaries within which the goal can be reached:

• to provide a secure and satisfying environment for employees now as well as in the future;
• and to provide satisfaction to the market now as well as in the future. 

Dr. K.J. Youngman further elaborates on the theory that these three entities are actually important to the same degree. Making money, however, is much more tangible than the other two. Youngman continues his approach to measurements to judge the impact of local decisions on the global goal with financial measurements only: the fundamental operating measurements (future) throughput, inventory, and operating expense on the bottom-line results of net profit, return on investment, and cash flow. 

For better understanding in the productivity way of thinking and a more strategic approach, he transfers the fundamental measurements (net profit, return on investment and cash flow) of Goldratt and Fox into the following fundamental operating measurements, with the 'future' condition incorporated in Throughput: 

• (Future) Throughput (T); 
• Inventory (I);
• Operating Expense (OE). (Figure 6) [8] [9]

Figure 6 Fundamental operating measurements (future) throughput, inventory and operating expense [9]

As a result of the conventional goal of commercial companies to make money, in general, at commercial companies, fundamental measurements of success are financially based, which leads to a primary focus on commercial project objectives and thereby less on other important project objectives for the project supplier. At non-profit organisations, focusing on securing sufficient funds vs. cost might distract from a primary focus on their organisational goals.

Continuous improvement [3]

There is good news however, although again this potential is not fully utilised within project suppliers. It is important though to emphasise that clearly many organisations – if not all – including project suppliers do continuously work on continuous improvement processes within their organisations. Usually, project team members have their direct project scope as their main priority on their project(s), however work on the side on one or more continuous improvement activities. However, in many cases both work activities are not clearly linked or reported in an integrated structure, and surely priorities will conflict between both important activities. 

Conclusions

This Now section described a current reality of managing project objectives at a supplier of projects, where projects provide less or limited benefit for its organisation, identifying the gap between project and organisational success at the project supplier.

Various relevant definitions, such as project (management), project success (success factors and success criteria) and project objectives were analysed. Next the conventional definition of a project objective was studied, identifying the biased customer perspective on project objectives, and the absent supplier perspective on project objectives. The absent supplier perspective is referred to as the gap between project and organisational success at the project supplier. This absent supplier perspective combined with the conventional goal of commercial companies to make money, can result in various problems at the project supplier to achieve benefits from their projects for their organisation.

The next section Future describes an opposite future reality of managing project objectives at a supplier of projects, where projects provide the most possible benefit for its organisation. 

Footnotes (see section References)

[1] Wikipedia, 2022.

[2] Basu, 2012; Beleiu, 2015; Korbijn, 2014; Almarri, 2017).

[3] van der Wekken, 2024.

[4] Knowledgerush, 2012.

[5] Prince2, 2017; Infolific, 2013; PMI, 2021; IPMA, 2018.

[6] Goldratt and Cox, 1984.

[7] Goldratt, 1994.

[8] Goldratt and Cox, 1984; Goldratt and Fox, 1986.

[9] Youngman, 2021.

[10] Birkenshaw et al., 2014. 

Appendix

Current reality tree (CRT) of Process assets

Navigate through below CRT by starting at the bottom on page 1 and follow the various elements, such as the starting point (9), assumptions and statements (e.g. 1, 4 and 5) upward through the diagram (upwards through pages 2, 3 and 4) towards various undesired effects (UDEs) and the main UDE (51) at the top of the diagram on Page 4.