Discuss about the Project Management Portfolio Of Ford.
The report aims to analyze the importance of project portfolio management in reducing inefficiencies of a project of a company. Project portfolio management is vital for a company that runs too many projects. This portfolio management assists the organization to categorize their projects and arrange their projects with the organization’s goals (Martinsuo, 2013).
Ford motor company has been successful in maintaining its place as the fifth largest manufacturer of automobile in the world. The company’s aim is to reach the peak in global automobile industry. Therefore it needs to built a strategic formulation method and improve its overall profits.
The report describes the situational context of Ford in detail. The current procedure used by the company to manage its projects, the benefits of using the project portfolio management process and its drawbacks. Finally, the various elements of a plan are discussed with its implementation and the techniques beneficial for the company has been discussed.
Situational Context and Evaluation:
View of the organization:
Ford motor company has been going through many years of struggle due to various internal and external issues, which they need to overcome. Project portfolio management ensures that the company’s projects must have a set of goals that will surely bring success. They need to look at the sectors that are getting success and the sectors that have started to decline simultaneously. Currently the company hands its projects by understanding the stakeholder’s requirements, managing the budget of a project, considering the external environment changes affecting the organization but does not use solid project management tools. These are the aspects of the company’s project management system, which it needs to improve.
Potential and scopes for improvement:
Ford always keeps eyes on the changing economy of the world and manages to show notable growth. Beside USA, the company utilizes opportunity to grow high potential developed and developing countries and increase its presence. The attractiveness of its products and innovative business decisions including environment friendly outcome has enhanced its penetration and expansion. Strengthening of U.S dollars has posed a potential threat to its profit margin. The company needs to improve its business efficiencies so that it can maximize the scopes in emerging markets.
The company has been addressing the growing demand for electric as well as hybrid automobiles. Ford has the chance to improve its after sale services to attract more consumers. The company faces the problems regarding its high priced luxury projects due to increasing wealth gap (www.ford.com.au, 2017). However, the company must work on innovation and produce more customized products for customer satisfaction.
Climate change creates opportunity for the company to produce environmental friendly products. Ford’s products help in conservation of environment. This effort aligns with the popular low-carbon trend. In this section, the company has lots of opportunities to excel. Ford can produce the products using alternative fuels or electricity. These efforts will solve the growing problems of decreasing oil production on one hand and can reach to the remote areas to build its auto firms.
Opportunities of project portfolio management process:
As mentioned before the project portfolio management assists an organization to set a target and bring about the expected results. Furthermore, the project portfolio management can initiate the required changes that the company needs in that situation (Unger, Gemünden & Aubry, 2012). To execute the projects successfully the project portfolio management creates a flexible structure in the company. Therefore, the changes do not pose threat to the growth of the company. An efficient project portfolio management can prove to be an important responsible factor in the company’s success.
- In order to penetrate more markets throughout the world, a project portfolio management process can create better adaptability and acceptability towards change.
- The project portfolio management process reviews constantly and its monitoring results to the company’s higher return.
- The process identifies the dependencies of Ford Automobiles therefore; it will help in eliminating possible inefficiencies before occurring.
- Through this process, the team will easily identify the competitive advantages that the company enjoys. This will help in gettable advantages over its competitors (Killen et al., 2012).
- The project portfolio management not only focuses on the projects itself but concentrate of the set goals of the company as well as its strategies.
- In such processes, there has always been a coordination and harmony of both IT and business projects (Schwalbe, 2015). This mixture is the main contributor to achieve organizational targets of the Ford.
Threats of project portfolio management process:
The drawbacks in project portfolio management process that the company needs to overcome are:
- As the active participation of sponsors and executives is vital during the whole process, it is important that all of them have same interpretation of the company’s strategic goals and expected benefits from the project.
- The project portfolio management process builds modeling step, which includes system-environment models as well as interdependence model (Gollenia, 2016). This aims to identify the contributions and the elements that influence Ford’s achievement. The mangers can utilize these models, modify them with information, and provide estimates on the financial impacts of the portfolio’s decisions.
- Sometimes there is a breach between the strategies of the company and the operational activities. The project sponsors are needed to be present to align its strategic ambitions towards sustainability in defined objectives, instructions and decision-making procedure for the project portfolio management. They connect the temporary parts and the permanent parts of the company.
Development of the Plans:
The analysis of the present condition of the company and the internal as well as external factors affecting its business has showed a required business plan that must include four elements.
- Immediate need of restructuring so that the company may operate profitably.
- Acceleration of developing new products according the customers’ needs.
- Financing the plans and improving the balance sheets.
- Working together as a team.
The project portfolio analysis and produced plan will make the authorities realize the changes are need of both time and condition of the company. The plan will discuss the areas that need immediate changes (Beringer, Jonas & Georg Gemünden, 2012). It will make the employees focus on the organization Ford itself rather than its competitors such as Jaguar and Aston Martin. The project portfolio management will enable the company to focus on the single goal instead of scattered aims on other brand products. The concern of Ford Motor should not be only in making profits but they must care to reach to its customers with more variety of products. The betterment of the customer service and allowing the customers to choose the best-fitted cars will change the present scenario of the company (Ryals, 2013). The company also brings changes in the workplace, where the employees can create an open and trust worthy work environment. Ford will be able to build a successful workforce if they start to involve the employees in the company’s decision-making procedure. This will strengthen the employee bonding and increase the speed of achieving the organizational goals.
Project portfolio management model:
Discretionary portfolio management is suitable for the management of the company because a discretionary manager is fully responsible in making decisions for his investor. He can take any strategy he thinks the best when the issues of period and individual goals are taken.
After the investor hands over the cash to the professional, he can sits back and trust that his profits will definitely increase.
The first step of plan is for the project manager, who will define the goals of the program, some description of the process visions and product. Program vision provides a clear understanding of the key elements to achieve the program targets and the method to manage the project.
The next step is to appoint a planning team, which will form the scope statement. This team must work together and develop a statement for the program. Based on this statement, a work breakdown structure and critical path method of project network diagram will be constructed (Klingebiel & Rammer, 2014). This statement will be contained with assumptions on product content, specific features, process content for manufacturing, economic issues and assumptions of production facilities in contrast with present business practices (Barbuto Jr, 2016). This description must be clear and almost completed and leave scope for evolvement of planning.
This will create a model based on the project network diagram and represent all the activities and time for the entire program from conception to production. To form the model, the team needs to define the level of trait of the work activities (Teller et al., 2012). The basic use of the work breakdown structure is to help visualizing the detail. Important program milestones, macro-level work activities, funding points and corporate review must be included.
Every functional representative must create one’s own portion of the activity network using the detail guided in the structure. Each must give attention in coordinating sub-project actions with other functional sectors (Heising, 2012). Clarity and entirety are the keys to be succeeded in the execution of the program. A complete program network must combine all the sub-projects programs into the single network in detail. Utilizing this network with activity duration assessment, the whole program length and the disposition of the individual benchmarks can be calculated (Kerzner, 2013).
The team must assure that the primary focus of its activity and planning are always in developing the product. The team verifies that the critical method must include real work actions directly related to the product development. Usually the critical process occupies some auxiliary work activities. These may be burden of a business practice and should be changed. This assures and fore says the team that the critical method model probably needs more modification.
Techniques and tools:
Project Portfolio Management Techniques deal with the whole range of project portfolio management functions, from choosing projects through characterized portfolio management processes to facilitate the best execution of projects (Silviusab, Schipperb & Nedeskia, 2013). There are plenty techniques used for project portfolio management. The essential features of these tools are:
- A systematic process of evaluating the projects.
- Planned resources.
- Constant tracking of costs and benefits.
- Analyzing cost benefit.
- Maintaining constant progress reports.
- Access to the information whenever required.
- Communication mechanism to access the necessary information.
Most of above techniques, which are used in planning a project, are necessary in Ford’s case. Possible changes are needed in the company. Resistance is also normal but preparation for defending the resistance must be ready. It is important to have good team and proper vision to assist Ford to reinvent itself and stay ahead.
Therefore, from the above discussion it may be concluded that the fifth largest automobile company Ford has needed the assistance of project portfolio management so that they can come out of the present struggling situation. The project portfolio management helps the organization to collect information and align them according to the project criteria. Ford needs to introduce portfolio management plans to achieve its aims.
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www.ford.com.au. (2017). Home. Ford Australia. Retrieved 21 October 2017, from https://www.ford.com.au/