The Context of a Project

Independent of the project methodology — traditional or agile — larger projects are usually embedded in an organization.

The dynamics of the project then take place in two areas:

• within the project and
• outside the project.

The area around the project is called the context of the project. It is important to distinguish between what happens within the project and in the context of the project.

In a company, projects generate change in 5 categories: organizational change, process change, product change, resource change or asset change. Not everybody welcomes change. Even if the change is for the better of the company it may be to the disadvantage of individuals or cause disruptions to well practiced processes or procedures.

The people who are impacted one way or another by this change or the project itself are typically called stakeholders: customers, top managers, line managers, employees, project team members, etc.

Project contexts also need management

A project manager needs to be aware of the context of the project. Even though a project may develop smoothly internally, it may well cause discomfort in its context. This discomfort in the context may then either hinder the project progress or may later burden the use of the project result in the organization.

In addition, issues from the context may arise that are not directly a consequence from the project. For instance, the environment may change, unforeseen risks may occur, or there exist company dependencies from third parties that do not deliver the expected quality to the project.

Therefore, the context of a project also needs management. The problem, however, is that the project manager may well be powerful within the project but usually does not have a lot of power in the context.

As a result the project manager has to rely on the project sponsor and the steering committee. The project sponsor typically is a senior manager higher up in the hierarchy. The steering committee — if set up thoughtfully — is comprised of senior managers that are also stakeholders of the project because their area of responsibility is also impacted by the result of the project.

The purpose of the steering committee is to give support to the project or remove obstacles. Given that resources are always scarce, they often have to decide between the line functions and the project by setting priorities, allocating resources, or resolving conflict.

Status Report for Stakeholders

An essential task for a project manager and the project controller is to keep the stakeholders of the project informed. This is especially true for the steering committee members of the project. Only then steering committee members can help to resolve issues of the project.

On top of what is going in the project they should also be informed about what the status in the context is. Typically a project has 4 kind of exposures in the context:

1. Significant Change Issues refer to fundamental issues in the change management process that tries to introduce the changes from the project into the organization.

2. Significant Quality Issues refer to material quality issues beyond the ones of individual deliverables and that are of overall concern and are arising from the interfaces to the project, e.g. from parties external to the project (but possibly still internal to the organization) and that are beyond the control of the project manager.

3. Significant Risk Issues are issues that have material severity, a certain tangible likelihood, and which are concrete, threatening, and will bring the project success in jeopardy.

4. Significant Knowledge Issues are issues of missing, not transferred or not documented knowledge. A loss of knowledge from the acquired knowledge in the project may slow down the project, threaten the handover from the project into the line responsibility or will make the operations after the project difficult or impossible.

All these issues can jeopardize the project from the outside and, thus, need special attention. One way of doing this, is to assign roles of a responsibles for managing such issues. But the minimum requirement is to add the according status to the status report with an evaluation of the issues and if measures have already been taken to remedy the issues.

Requests to Senior Management

Finally, as explained above, the steering committee also has the function to resolve obstacles that typically cannot be resolved by the project management him- or herself. Such issues need to be resolved higher up in the hierarchy. Typical issues of this nature are:

• Add people
• Announce project, sponsor and project manager
• Approve additional expenses budget
• Approve additional time budget
• Confirm interest in project
• Clarify priorities
• Communicate project, responsibilities & organizational setup”,
• Empower Project Manager
• Make overall objective SMART
• Openly demonstrate commitment
• Refine objective
• Resolve conflict
• Support with external resources
• Support with IT resources

Such issues should be brought to the attention of the members of the steering committee, because these people can best decide how to address such problems. Often issues like these are not put into status reports, because they are not considered appropriate. But then the project manager and the project team are left alone with the problem and have no other chance to struggle along even though this is the least efficient way for the company. A good status report can and should help to avoid this.