Challenges and Best Practices in International Projects

Table of Content

Executive Summary

List of Abbreviations

List of Figures

1 Introduction

2 Problem Definition

3 Objectives

4 Methods

5. Main part
5.1 Definition of international projects
5.2 Challenges in international projects
5.2.1 Seven main issues in IPs according to LIENTZ & REA (2003)
5.2.2 The five Dimensions of IPs according to BINDER et al (2010)
5.3 Best Practices (JW)
5.3.1 A model of success factors for global PM
5.3.1.1 Global teams
5.3.1.2 Global communication
5.3.1.3 Global organizations
5.3.1.4 Collaborative tools and techniques
5.3.1.5 Global Risk Factors
5.3.2 Practical examples (JW)

6 Results

7 Conclusion

8 ITM

Bibliography

Executive Summary

In this assignment the authors will look into the subject of challenges and best practices in international projects. A single examination of all the various challenges in the world of global project management like multicultural communication, geographical distance or asynchronous interactions - resulting from multiple systems happening and taking place in more than one location and are requiring different technological knowledge for e.g. - is confronted to a broad presentation, examination and evaluation of best practices: namely concrete business orientated solutions like global teams, collaborative tools or global project organizations. The theoretical introductory part exposes lack of sensitivity to local cultures, the general issue of complexity which arises in lack of control, variety of regulations and rules, different time zones and also the “treatment of the international project as a standard project” as main challenges for and reasons for failure of many international projects. All these rather impeding and logically challenging findings are visibly summarized in the “Five Dimensions of IP” figure, concluding that there are five dimensions which will affect every project in a different manner and in different decrees of intensity. Next, there is the description and visualization of new, interesting international PM tools like the risk register, quality gates. Additionally the authors come up with general rules and advice as the agreement on binding communication rules, templates and one language for successfully working global project team. In the last part the uneven challenges and best practices couples are kind of “married” by presenting two successful international projects: The SWAP project from the leading central European energy supply company OMV, where the superior project manager Barbara Krappinger succeeded in overcoming many cultural and geographical challenges and a major event management project from the Siemens

List of Abbreviations

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List of Figures

Figure 1 – Comparison standard project and international project

Figure 2 – Seven main challenges in IPs according to LIENTZ & REA (2003)

Figure 3 – Five dimensions in IPs according to BINDER et al (2010)

Figure 4 – Cultural dependable expectations towards the project manager

Figure 5 – Overview of “Best Practices” for international PM

Figure 6 – Hall and Hall´s Modell: High-Context vs. Low-Context Cultures

Figure 7 – Occurrence of the Success Factors in the Literature

Figure 8 – Evaluation of Best Practice Tools and Techniques for IPM

Figure 9 – Portfolio of selected global risk factors in international projects

Figure 10 – Major phases of a general risk management cycle

Figure 11 – Challenges & Best Practices for “SWAP” (OMV Group)

Figure 12 – Challenges & Best Practices for “EURO 2008” (Siemens AG)

1 Introduction

Screening the web it can be read many similar headlines and stories as:

- “The World Bank's Land Management and Administrative project failed to protect the people of Beoung Kak lake in northern Phnom Penh”^[1] (2010)
- “University of Illinois Global Campus project failed”^[2] (2009)
- The “Virtual File project” of Science Application International to provide the FBI with better IT solutions failed” (2005)

The latter project was a loss of five years of development and the total sum of $US 170 million in cost.^[3] The failure of public projects often are more revealed by the press as people getting upset when their taxes are wasted. But many international projects fail across all sectors. It is estimated that 50% of all international projects either fail, are not completed or do not deliver the expected targets.^[4] A project failure means a waste of time, money and other resources for all the involved parties. The questions in this context are: “Why do so many international projects fail?” and “What do successful international project managers differently?” This assignment seeks to answer these two questions.

2 Problem Definition

In contrast to standard projects the difference of an international project is grounded in co-working processes of people, teams, groups and companies from different cultural backgrounds and countries often across borders. Besides the challenges from standard projects these multicultural interferences impose additional challenges to the project management and therefore must be treated with special knowledge, sensitivity and additional methods.

3 Objectives

The title of this assignment already formulates the crucial tasks of the main part, namely to oppose the accumulating challenges which imply most of international projects to best practices providing solutions, hints and ideas to overcome these challenges in the best possible way. The focus of the examination is directed towards “international” and “global” issues.

4 Methods

To provide an overview of the topic the authors screened several expert literature on IPM and searched the websites of IPMA for sound information. In addition, the authors interviewed Barbara Krappinger, the Austrian PM of the year 2009, for insights on a concrete example. Own experience and group discussions complete the sources.

5. Main part

5.1 Definition of international projects

The PMBOK® Guide 2008 defines the project as a "a temporary endeavor undertaken to create a unique product, service, or result." Important is its limited character in labor, schedule and budget. Whereas a standard project in general takes place within a single organization and a single country, an international project involves people from various countries, can be conducted in different countries, locations, and involves different entities, business units and cultures.^[5] For a more detailed description of main differences please compare figure 1 below.

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Figure 1 – Comparison standard project and international project

As can be seen above from figure 1, international projects are defined through plural nouns and adjectives such as multiple, varied, variations or more complex. Whereas standard projects can be seen within one single company, with one single company culture, and regulations and self-interest are more easily understood. Projects that are conducted internationally are way more complex and culturally diversified. Of course, the whole issue of complexity and also cultures applies too for national big projects. On the one hand, huge national projects also can involve different company cultures and are therefore also very multifaceted, too. On the other hand, huge national projects are seldom “national” any longer. Big companies operate across borders, employ people from different nationalities or involve foreign experts. A clear distinction would rather be very artificial. Anyhow, the paper likes to stress challenges and later on best practices that differ from other projects by highlighting issues that derive from the fact that international projects - in contrast to standard projects - involve people from different cultural backgrounds and cultures.

5.2 Challenges in international projects

In addition to the challenges of standard projects, IPs impose – due to the different countries and cultures involved - additional challenges to PMs. For the presentation the authors relied on the findings of Lientz & Rea (2003). Which will be shown in 5.2.1. Within the scope of class feedback and later on group discussion the authors looked for a more sound model to describe the differences and will therefore be presenting the 5 dimensions of Jean Binder, a PM with many years of IPM experience.

5.2.1 Seven main issues in IPs according to LIENTZ & REA (2003)

Lientz & Rea (2003) stress out seven main issues why international projects fail. The findings of can be seen in figure 2.

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Figure 2 – Seven main challenges in IPs according to LIENTZ & REA (2003)

Source: Compare Lientz, B & Rea, K. (2003), p.13

Reviewing the list, it can be stated that at least five of the seven listed factors are applicable as well for bigger projects. Even for smaller projects some points are applicable, e.g. lack of measurement or micromanagement can pose a problem to every projects.

Only two factors are valid to differ in international projects: “Lack of sensitivity to the local culture” and “the treatment of the IP as a standard project”. The findings of Lientz & Rea (2003) seem to be incomplete and not stressing on real differences, the authors therefore would like to present different findings in the next chapter and go into a bit more detail.

5.2.2 The five Dimensions of IPs according to BINDER et al (2010)

According to Jean Binder (2010), a very experienced expert in IPM that publishes articles as well for the IMPA, there are mainly five dimensions ^[6] that cause major problems in managing international projects.^[7] Please compare figure 3 on the following page.

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Figure 3 - Five dimensions in IPs according to BINDER et al (2010)

Source: Own graph. Five dimensions derived from Binder et al (2010), p.4-7

This model is not yet published and was first presented by Binder, J., Gardiner, P.D., and Ritchie, J.M. in 2009 at the PMI Global Congress 2009 EMEA – Conference in Amsterdam. The model in mentioned in an article of the annual publication of the IMPA.^[8] A model of success factors for Global Project Management. These five dimensions will affect every project in a different manner and in different decrees of intensity, but it is certain that they will affect every IP in the one way or another. In the following the five dimensions are explained in a more detail.

[...]

^[1] http://www1.voanews.com/khmer-english/news/economy-business/a-40-2010-03-19-voa6-90235572.html [accessed April 2010]

^[2] http://www.tonybates.ca/2009/09/03/why-the-university-of-illinois-global-campus-project-failed/ [accessed April 2010]

^[3] http://www.projectperfect.com.au/info_it_projects_fail.php [accessed April 2010]

^[4] Lientz, B., Rea, K. (2003), p.13

^[5] Compare Lientz, B. & Rea, K. (2003), p.11

^[6] Binder et al (2010) “A model of success factors for Global Project Management”, in IPMA – Project Perspectives 2010, 4-9, accessed: http://www.ipma.com [April 7th, 2009]

^[7] Binder makes a distinction between international and global projects. The authors find the differentiation rather artificial when talking about challenges and best practices and therefore will neglect the fact. For further reading compare Binder (2007), p.18

^[8] Binder et al (2010) “A model of success factors for Global Project Management”, in IPMA – Project Perspectives 2010, 4-9, accessed: http://www.ipma.com [April 7th, 2010]