1
2.
Literature Review
Proj ect Defi Defi ned
A project can be considered to be the accomplishment of a particular objective, which involves a chain of activities and duties with the use of resources. It has to be finished within a set requirement, having definite start and end dates (Munns & Bjeirmi 1996, p. 81). 8 1). F eatur es of of a proj ect
According to Project Management Body of Knowledge Guide (2004) the essential natures of a project are temporary venture, unique deliverable, and progressive elaboration. In Layman‟s Term, temporary means there is a deadline or target date. It is unique in the sense that a specific and desired outcome is the objective with budget that limits resources (PMBOK 2004, p. 8). Project is described as temporary endeavors since they are activities were a unique product, service, or result is created with distinct and definable time frame. The organization of a project involves modified activities to support this feature, as such, a main sign of project success is how it performs effectively given a specific schedule — that that is, and it does start and end on time. Another feature of a project is its Unique Deliverable. Unique means that the product or service is dissimilar in several distinguishing way from all other products or services. Uniqueness does not indicate that there is no resemblance to other projects, but that the range for a particular project has express that it must be produced within limits, all the way through risks, with particular resources, at a particular place, and within a definite period; for that reason, the procedure to create the deliverable as well as the deliverable itself is unique.
2
The distinctive procedure and deliverable brings the third feature of a project: progressive elaboration. Project management is a set of interconnected processes applied in a progressively elaborative approach, in which to create the deliverable. Progressive elaboration is the enlightening and meeting point of information through time. For instance, in the manufacturing design process, a comprehensive and extensive idea may be an opening point for the design team; but in the course of the design process, the idea is narrowed to a particular range and is more elaborated to accomplish the completed design. In addition, it may go on to be elaborated and not be finalized until the product, service, or result is delivered.
Proj ects distingu ished ished to oper oper ations and f rom programs
Organizations carry out work. Work usually can be categorized into either projects or operations, though in some instances both of them may have common characteristics. Both operations and projects have several characteristics in common such as, people carry out both the activities, both are guarded by limited resources, both are planned, executed, and controlled. Projects and operations vary mainly in its repeatability. Operations are continuing and cyclic while projects are unique and temporary as described in the preceding paragraphs. Most organizations perceived projects as a way to respond to requests which are not within the reach of the organization‟s usual operational limits (Choudhuri, n.d., p 21). Proj ect M anageme anagement nt D efi ned
Project management is the use of facts, proficiency, tools, and procedures to project activities to meet project requirements. Therefore, for success to be attained, the project manager must be skilled in using the specifications to meet or surpass stakeholders‟ stakeholders‟ needs and
3
expectations, and operate following procedures which allow a project team to function (Choudhuri, n.d. p. 3). In program management, the Program Manager is accountable for making sure that the overall program is accomplishing the company goals. This call for each of the project managers to administer their individual projects in a way that simply combine into the overall program preparation (oertson, n.d., p. 1).Thus, 1).Thus, the program manager is in charge for evaluating the whole program. The tasks involve taking into account the risk supervision strategies for each individual project and evaluating the „collective‟ risk of the program. F actor actor s in volved volved in Proj ect M anageme anagement nt
The factors involved in the project management usually fall under the course of time, cost and quality. Time refers to the available period to bring the project, cost corresponds to the sum of money or resources accessile and quality stands for the “fit-to“fit -to- purpose” purpose” that the project should be complete to be a success (Jenkins 2005, p. 6). In the actual field, time is commonly fixed in a project while the quality of the finished project will depend on the resources accessible or cost (Bureau of Reclamation, n.d., p. 2). Likewise if the work focuses to a fixed level of quality, the cost of the project will rely based on the time available. Br ief H istory istory of Project Project M anageme anagement nt
Project management has been used since the Egyptian epoch, yet, it has been about half a century ago that businesses begin relating organized project management tools and procedures to difficult projects. During 1950s, Navy engaged current project management systems in their Polaris project. Between 1960s and 1970s, huge construction and engineering corporations made use of ideas and tools of project management to administer large finances, and projects. In the
4
1980s, manufacturing expansion divisions started to take up and apply complicated project management practices (Carayannis, Kwak & Anbari 2003, pp. 2-5). By the 1990s, the project management presumptions, tools, and systems were broadly established by different industries and businesses.
Who Wh o are ar e the stakehol stakehol ders? ders?
Stakeholders are fundamental element of a project. Stakeholders are entities who have a venture in the project. Fundamental in the sense that they are the key people who will provide the requirements, manipulate the design of the project and eventually, the people who will accumulate the benefits of the finished project. There are different kinds of stakeholders and every kind should be handled in a different way:
Executive stakeholders are those who are in charge of the financial aspects. Typically they are managers or directors who are concerned with profit-making goal for the project. Therefore, they are people from the company who pay the bills. They must limit themselves to commercial side and be inactive in technical design.
End-users are the entities that will use the end product. This group of stakeholder is also known as customers.
Experts are the people from different fields that will have a contriution on the project‟s technical side. Meaning, they have different specialization and their inputs are needed for the technical area of the project. Examples of these experts are the people of graphic designing, support and sales representatives, sometimes lawyers and accountants (Jenkins, 2005, p. 9).
5
The objective of stakeholder study is to build up a strategic outlook of the individual and institutional condition, and the connection between the diverse stakeholders and the objectives recognized (Gawler 2005, p. 18). Stakeholder analysis is an on-going procedure that must employ diverse groups, as issues, actions, and agendas grow. The full involvement of stakeholders in both the plan and completion of projects is a gateway (but not a promise) to their victory. According to Gawler (2005), stakeholder p articipations are as follows:
offer local people manage over how project activities influence their lives is necessary for sustainability
creates a sense of possession (if initiated early in the design procedure)
offers prospects for education for the project team and for stakeholders themselves
Builds ability and leads to dependability.
It is significant that stakeholder involvement not be restricted, or controlled by any one assembly. Once the project has established common ground, and has discussed its objective with partners counting neighboring stakeholders, the stakeholder contract should be evidenced in writing (Gawler 2005, p. 18). This may appear excessively official but it has been revealed time and again to give transparency, and to avoid (or resolution) disagreement in the future.
6
Di ff erence of proj ect manage manageme ment nt & proj ect mark mark eti ng
The table below shows a summary of comparison between project management and project marketing.
The table summarizes the most vital points of junction and disagreement between the two aspects and presents a source for new and modern ways for research and administrative ad ministrative progress.
Ar eas discuss discussed in Project Pr oject M anagement anagement
The Basic Project Management Structures
A project organization is an arrangement that supports the management and completion of project actions. A chart of organization illustrates where each employee or possibly a stakeholder is positioned in the project structure. Its major cause is to form a setting that encourages connections among the group associates with a least amount of interruption, overlaps and discrepancy (PM4DEV 2013). Meaning, a project organization chart is a plain graphical diagram of the people drawn in the project and where they fit in general organization, or project. It also suggests that the creation of an appropriately planned organization chart will be a key to project success. A basic model of an organizational structure is the Programmatic-Based Structure. It refers to a conventional structure in which program division managers have official power over the
7
majority of resources (PM4DEV 2013, n.d.). It is only appropriate for projects in one program segment. On the other hand, it is not appropriate for projects that need a various combination of people with dissimilar skill within the range of program sectors. Below is an example of chart on Programmatic-Based Organization Structure.
s seen in the organizational structure, structure, the most evident benefit of programmatic based projects is that there are obvious outline of authority. In huge projects, the project managers are likely to be also the program unit manager. Negotiation is not needed with other program units for resources, as all of the staff considered necessary for the project belongs from the same program area (PM4DEV 2013). One more benefit of this kind of organization is that the team members are usually known with each other, given that they all are employed in the same area.
Pr ojec oj ectt M anageme an agement nt Pr oces ocesses
Typical life cycle phases
8
The project life cycle provides the starting point and the ending point of a project. It also establishes which transitional procedures at the beginning and the end of the project are integrated and which are not (Choudhuri, n.d. p. 8).
The first phase in project life cycle is Initiating. It is the formulation period of a possible business engagement or a contract with the client or user. It provides a platform for a possible discrepancy directly on the project (Williamson 2001, p. 9). Therefore, the idea of initiating phase is to lay down the project up for accomplishment. It offers the privilege of having a discussion of people involved before anything has been started. As illustrated in the diagram, the beginning starts from initiating and ends through closing. It signifies the start of the project which is the initiation process while the end of the project is the closing. The second phase is planning. It is the stage of arrangement and refinement of the objectives. It also involves picking the best of the alternative lines of action to reach the project goals (Williamson 2001, p. 9).The sum of planning performed must be proportionate with the range of the project and the value of the information developed. Planning is a continuing effort all through the existence of the project. As shown in the diagram, executing and controlling have a common depth under the planning stage, showing that these activities need same level of effort and have a connotation related to that of making the product, creating the service, or producing the result.
9
In a small project it is likely that one plan may be used to describe the full range of work and all the resources required to complete that work. For larger projects, planning will be achieved at different levels of detail at different times. In summary of this, all types and sizes of project require preparation to re-plan from the very start. Without cautious planning it is possible that the project will not succeed to accomplish its objectives. However, the planning phase may include tools that are useful to project managers. An example is the Gantt chart. A typical device that permits managers to organize and plan a particular project is what the so-called Gantt chart. Henry Laurence Gantt built up this tool on project management during the 1900s. This chart is basically made up of horizontal bars showing the duration of each duty. It is normally used in staging a specific report and to be explained to stakeholders. The weakness of this is that it may not hold all the data required by the manager of the project in order to formulate decisions for the duration of the project (Supplemental Topic 2008). The last phase is Closure. It involves formalizing receipt of the project and bringing it to an organized ending. A post project review is practiced to determine to what level the profit have been accomplished in the project. Find out if there are any needs for further improvements or amendments. There should be assurance that the project is handed over to a reliable staff who will deliver the results. Lessons learned session maybe conducted. Recognition of outstanding performance of specific people who are part of the project‟s success takes place. Finally, celebration of project completion may also take place. Therefore, closure is just a matter of recognizing that everything arranged has been properly delivered. Closure takes place as intended at the end of the project or earlier if the need or validation for the project no longer exists.
10
Amazon.com Amazon.com Company Company Pr ofi le
Amazon.com “AMAZON CAN BE ONE OF THE MOST SUCCESSFUL COMPANIES ALL OVER THE WORLD. RISKS ARE BIG, BUT PROFITABILITY CAN BE ALSO BIG” - Morgan Stanley Dean Witter Amazon.Com is a top online retailer business, present for trade are diverse products such as books, music albums, movies, videos, gadgets, electronics, computer software, video games and house products helping about 22.5 million clients in more than 150 countries. The company was started by Jeff Bezos in July 1995 in Washington USA (Amazon.com Inc, n.d.). The founder finished his studies in Princeton University with the degree of BS in Electrical Engineering and Computer Science. His professional occupation began in 1988 at Bankers Trust Company, where he was Vice President in 1990. At the end of the 1990, he transferred to a Wall Street investment firm, D.E. Shaw & Co. where he became a Senior Vice President in 1992. In those early years, Bezos become aware of a significant prospect on the online trade. He prepared a record of potential products that could be put up for sale online, counting books, bo oks, publications, pub lications, music, and others were he finally come to a decision to begin selling books (Amazon.com, Inc., n.d.). The major causes of his selection were for the reason that there are more books to put up for sale than music albums and as well as because the book publishing production is more reachable than the music production, mostly controlled by half a dozen of huge record companies. He resigned on his occupation in June 1994 and lived in the West, preferring Seattle as initial point because of its closeness to a main ook distriutor, Ingram‟s Warehouse in Oregon (Amazon.com, Inc., n.d.). This is how the business that took its name from the river with the largest water flow of the planet began in a garage downtown Seattle starting with four recruits, to be the leading flow of e-commerce book trade.
11
The company's aim is to become the top spot to purchase, locate and discover any merchandise or service accessible online. Amazon.com aims to go on to improve and widen its brand, buyer base and electronic trade proficiency with the objective o bjective of creating customers' ideal online shopping place, in the United States and across the globe. The L aunchin g of A mazon mazon Ki ndle Project Project
In November of 2007, Amazon launched its newest program Kindle, an e-reader made to permit uncomplicated admission ad mission to an immense collection of electronic books to be downloaded and transferred on the tools. It was massively trendy, sold out within few hours and endured being out of stock for quite some months. More than 90,000 90 ,000 books were accessible for download at its date of launch; that directory grew to more than 160,000 by August 2008 and was rising by more than 25,000 titles per month. Reading materials such as blogs, newspapers and books are laden on the gadget wirelessly using the mazon‟s system and are availale in a proprietary design for the Kindle. Kindle users can as well send documents to Amazon to be changed and availale on the Kindle, and use such materials in email using the Kindle‟s rowser. rowser. In the launching and marketing of this kindle project, the company has carefully consider all stakeholders involved and laid great emphasis on it key stakeholders-the customers.
In 2011, Amazon president Jeff Bezos announced that the company is selling over one million Kindle devices for three straight weeks, a remarkable revelation from the biggest Internet trader. The revenue figures comprise the new Kindle Fire tablet and all other editions of the Kindle e-reader. Together with this increase in sales, the company has continued to accommodate the follow-up services to their major stakeholders which are the customers. Again, in this project, the positioning of its stakeholders who are mainly the customers was given priority by the company. Amazon has provided an online troubleshooting page which will enable
12
its customers to personally troubleshoot their Kindle device. They even provided contact numbers for customer support over the phone which allows its customers to ask queries to Amazon Kindle technical experts. Amazon.com also created forums on its major website to accommodate some frequently asked questions a customer might come across. Amazon.com also sees their book authors as stakeholders. Amazon.com Publishing declared that their authors will receive payments once a month, 60 days behind.
On the other hand, stakeholders such as shareholders and investors were also given notice in the rise of Amazon‟s Amazon‟s Kindle. ccording to the letter of mazon President Jeff Bezos to his shareholders, he assured that the success of their programs were for long term extent. He mentioned that the company will balance the attention on monetary growth which highlights on long-term profitability and investment supervision. He again emphasized his obsession in serving his customers which brought the company compan y with so much success.
Another essential stakeholder of the company is the employees. He also mentioned in the said letter that the past year‟s victory of the company is the fruits of laor of his rilliant and industrious groups of employees. In the launch of diverse programs of the company, Jeff Bezos has maintained to set high standards in terms of hiring employees, to assure the continuous success of Amazon.
13
Amazon in Determining Its Stakeholders
At present times, stakeholders are gradually more apprehensive about accountability and administration of a specific business. In the Amazon.com, there are a several stakeholders in the corporation. Amazon has acknowledged its main stakeholder group (its customers). As an outcome, the company places consumer service as its leading priority. Jeff Bezos (mazon‟s founder and CEO) stated in one editorial “I elieve that the success we have had over the past 12 years has been driven exclusively by that customer experience. We are not great advertisers. So we start with customers, figure out what they want, a nd figure out how to get it to them.” In them.” In other word, the company‟s enthusiastic to stick to its viewpoint and showing significant importance to their number one stakeholder which are a re the customers. Second are the shareholders of Amazon as it is a publicly apprehended company. These stakeholders are more concerned on the return of their investments. Finally, mazon‟s stakeholders consist of the employees as they are a main factor in delivering Amazon's success. The Amazon Company views the employees as their backbone in operations. Every day operations rely on these stakeholders who work in numerous diverse areas with the goal to grant customers with the point of service they anticipate when interacting on the internet or discussing to a member of staff on the phone.
Ways of improving product and service delivery in order to ensure long term sustainability.
To gain customers and increase profit are the major goals of a typical business. But to have a continuous success, a company should maintain their customers‟ loyalty to their products. Research conducted by Pepprs & Rogers (1993) has shown that the cost for an enterprise to
14
develop a new customer is 10 times as much as the cost for maintaining an existing customer. Pepprs & Rogers (1993) also reveal that if a company put 5% of its marketing cost on customer, the company‟s effectiveness can e increased y 60% to 100%. This therefore shows that customers are very important to all business and for a company to attain the goal of gaining customers and increasing profit; the business should present qu ality products and services as well as marketing to customers. As for the Amazon.com, the transactions take place over the internet thus utilizing the modern technology. According to Accenture, the technology consulting company it has recommended that businesses that use technology in transactions should lift the quality of their products and customer service b y improving the following: Data Management and investigation - This involves using information gathered from customer to evaluate their preferences with regards to products and services. Thus, the company can evaluate what specific features of product they should improve or remove. Insight-driven advertising - This includes gaining insights into company from client data so the managers can perform more efficient marketing. As a result, the company would have an idea how their company looks like from the customers‟ perspective. Self-service optimization - This includes finding ways for customers to cooperate with the company when they wish for. In the case of Amazon, the company has provided websites that offers customer service or troubleshooting online. Specifically in Amazon Kindle project, the customers may just ask for help online from customer supports of the company and eventually, the customers could fix or troubleshoot for their Kindle device. Thus, a company should also create ways that will make their customers interact with them and do the self-service to accommodate their needs.
15
Workforce efficiency - This involves motivating the employees to accept innovative ways in improving customer handling by providing tools and guidance to carry out enhanced service. Thus, the employees should be up-to-date with regards to the tools that could assist them in working and supporting customers.
How
Amazon.com’s
marketing strategy impacts on levels of customer acquisition,
retention, and loyalty. “To become a customer - oriented company is the mission of Amazon.com” oriented -
Amazon, the largest online bookstore, started to earn income by 2002. This is a fragment of excellent news to worldwide electronic business progress. The company has adopted marketing strategies that will enable Amazon to achieve and attract customer and gain their loyalty. To boost the marketing aspect of Amazon, the company adapted the CRM or Customer Relationship Management approach. CRM is a mixture of hardware, software, procedure, relevance and administration assurance to develop client service, maintain clients and present methodical capabilities (Roberts, A. & Wallace, W. 2002, p. 14). The vibrant practice of running a Customer-company connection makes the purchasers prolong mutually advantageous profitmaking exchanges and discourage from involving in exchanges that are unbeneficial to the business (Roberts, A. & Wallace, W., 2002, p. 14). As the competition in market gets tighter, the customer loyalty has become one of the target marketing objectives of CRM. Customer loyalty suits to be the determinant component that manipulates the Amazon‟s Amazon‟s long-term long-term earnings. As a symol of the market share, customer‟s devotion to company is more significant than that to consumer considered market share. s an outcome, enterprise‟s executives desire to pay much more consideration to develop customer loyalty loyalty features, in order to make the company‟s project
16
increase vital competitive improvement in the vicious competition. Excellent service is also a significant point of magnetizing clients to prefer Amazon.com. Knowing online shopping as unusual, sellers and buyers cannot converse to each other straightforwardly. Furthermore clients do not have the opportunity to see the actual products before they buy. Thus, the Amazon.com thinks that both customers and sellers necessitate constructing a good connection, and they must have to serve their clients carefully to build assurance and trust. The embedded marketing system that mazon uses for the customer‟s convenience is perhaps the est model of the Amazon.com‟s Amazon.com‟s general approach to online marketing. Customer tracking tracking is an Amazon.com stronghold. If the customers allow the Website attach a bookmark on their computer, they will be receiving helpful features that will make their shopping experience much more convenient in stylish way. Furthermore, delivery is a significant component of online shopping. To Amazon.com, it has provided advertising to assist its clients to set aside the high price shipment. It frequently promotes free of charge shipment at usual period or giving various discount on the delivery. -Customer Loyalty of Amazon.com helps to build a long lasting relationship- Based on a survey performed by the Temkin Group; Amazon.com is one of the companies reaching the top rates of customer loyalty in America. The survey has found factors proving the result of their study. First is the customers‟ uncertainty to shift to other company. Thus, customers of Amazon.com has become satisfied with its services, they could no longer risk to spend time in trying other companies. Second is the customers‟ readiness to purchase more goods from Amazon.com. Hence, the impact of their quality service has built loyalty to their customers. And lastly is is the customers‟ willingness to suggest it to others. Therefore, the impact to customer acquisition is increasing. As a whole, the marketing strategies of Amazon.com such as the use of CRM and embedded marketing system, the company was able to attract customers, gain their
17
loyalty and maintain the relationship with these key stakeholders. Their online marketing strategies such as attention-catching advertisements and good delivery services have drawn attention to the customers. Through CRM and the embedded marketing system, Amazon.com has improved its customer service efficiency and effectiveness. The promos on their delivery services somehow gain the customers‟ loyalty. Therefore, their marketing strategies are working, giving a high level impact on the customer acquisition, retention and loyalty. As a whole, project management played a major role in achieving customer satisfaction. Through project management, projects by a company are carried out efficiently and successfully. In Amazon.com projects such as the launching of Amazon Kindle and its latest editions Kindle Fire etc., the customers are the main stakeholders that benefit on the project. These customers experience quality online shopping experience with convenience. Thus, the objective of project management has been attained in the company Amazon.com. The impact on customers resulted to customer loyalty, preservation and acquisition of more customers.
18
References: rd
A Guide to the Project Management of Body of Knowledge (PMBOK Guide), 3 ed. (2004). Project Management Institute, Four Campus Boulevard, Newton Sq uare. Bureau of Reclamation (n.d.). An Introduction to Project Management. US Department of the Interior Carayannis, Kwak, and Anbari, (2003). The Story of Managing Projects. Quorum Books. Books. Choudhuri, N. (n.d.). Project Management Fundamentals. ITCInfotech Fundamentals. ITCInfotech India Ltd. Gawler, M. (2005). Project Design in the Context of Project Cycle Management: Sourcebook. WWF Publication. Publication. Jenkins, N. (2005). Project Management Primer or “a guide on how to make projects work”. Nick Jenkins Publications. Munns, A. & Bjeirmi, B. (1996).The Role of o f Project Management in Achieving Project Success. S uccess. International Journal of Project Management 14 (2), 81-87.
Pepprs, D. & Rogers, M. (1993). The one to One Future, Building Relationship One Customer at a Time, New York: Currency Doubleday. PM4DEV (2013). Project Management for Development Organizations. (Accessed on August 25, 25, 2013). Roberts, A. & Wallace, W. (2002). Project Management. Great Britain: Edinburgh Britain: Edinburgh Business School Publications Robertson, K. (n.d.). Project/Program/Portfolio Management: What Does it Really Mean? KLR Consulting, Inc Supplemental Topic (2008): A Project Management. The Pennsylvania State University. University. http://www2.ds.psu.edu/AcademicAffairs/Classes/IST260W/topic0A/topic_0116_04.html (Accessed on September 27, 2013. Williamson, D. (2001). Amazon.com: A Brief History and Analysis. Published Analysis. Published by Amazon.com. by Amazon.com.
