Better Managers for a Better World

Project & Operations Management

(November 2024)
Antonio Alizzi

International Master in Finance

International Master in Pharma and Health Management
International Master in Sustainability and Circular Bioeconomy
International Master in Supply Chain Management and Logistics
 Better Managers for a Better World
Project & Operations Management
(November/December 2024)

Antonio Alizzi

International Master in Energy Management

International Master in Food and Beverage Management
International Master in International Business and Corporate Law
International Master in Media and Entertainment
Copyright

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modified of adapted, without the prior written consent of the
author, unless otherwise indicated for stand-alone materials.

Copyright Rome Business School

All rights reserved
ABOUT ME

Graduate in International Relations - Master’s degree in HR.

PhD in Business Management and Author of scientific works on business innovations.
From 2011 to 2014, Professor of Business Administration at the University of Verona.

At the end of 2014, appointed as a Head of the Communication and Image Department in Calzedonia Russia, and 2 years
later as a Coordinator of Calzedonia UK.
At the end of 2016, in Moscow (Russia) joined the International Media Group ACMG (Forbes, L'Officiel, Geo, SNC,
Numéro, Golf Digest and others) as the First Vice President.
From December 2020 to October 2023, Organization and HR Director at Fondazione ENEA Tech e Biomedical

Scientific Director of Fondazione Rizzola Academy.

His last book is Vite da Funamboli (Sandro Teti Editore, 2019)
ABOUT OUR 6 HOURS Better Managers for a Better World

We will explore the dynamic relationship between project

management and operations management, focusing on how these
fields can be effectively integrated to enhance organizational
performance. By examining the strategic alignment between project-
driven and operations-driven activities, students will understand how
to balance innovation (projects) with consistency (operations), crucial
for businesses aiming to achieve sustainable growth.
WHAT IS A PROJECT? Better Managers for a Better World

“… a project is a temporary endeavor undertaken to create a unique product, service or

result. A project is temporary in that it has a defined beginning and end in time, and therefore
defined scope and resources. A project is unique in that it is not a routine operation, but a
specific set of operations designed to accomplish a singular goal.

Project Definition | Project Management Office (uchicago.edu)

What is a Project? Better Managers for a Better World

Project:
unique, one-time operational activity or effort
Examples:
- constructing houses, factories, shopping malls, athletic stadiums or arenas
- developing military weapons systems, aircrafts, new ships
- launching satellite systems
- constructing oil pipelines
- developing and implementing new computer systems
- planning concert, football games, or basketball tournaments
- introducing new products into market
SUMMARY Better Managers for a Better World

1. Foundational Concepts Review

2. Strategic Alignment
3. Resource Allocation and Utilization
4. Performance Metrics
5. Change Management
6. Risk Management
7. Technological Integration
8. Case Study and Practical Examples
1. Foundational Concepts Review Better Managers for a Better World

PROJECT vs. OPERATIONS

Definition and Characteristics
• Project Management: Involves the planning, executing, and closing of projects,
which are temporary endeavors undertaken to create a unique product, service, or
result. Projects have defined scopes, timelines, and resources, and they are generally
characterized by their uniqueness, temporary nature, and specific objectives that
drive completion.

• Operations Management: Focuses on the ongoing activities that are necessary for
producing goods or providing services. Operations are continuous and repetitive,
aiming to maintain the business’s core functions and efficiencies. The focus here is on
consistency, efficiency, and quality of output over time.
PROJECT vs. OPERATIONS Better Managers for a Better World

Project Life Cycle:

• Initiation: Defining the project at a broad level and authorizing it to begin.

• Planning: Outlining how to achieve the project's objectives with timeframes,
costs, resources, and selecting methodologies.
• Execution: Actual performance of the project tasks and management of
resources.
• Monitoring and Controlling: Measuring project progression and
performance to ensure it aligns with the project plan.
• Closure: Formal closing of the project and assessment of the outcomes
against the initial goals.
PROJECT vs. OPERATIONS Better Managers for a Better World

Operations Life Cycle:

• Design: Designing the operation system or product, considering capacity,

supply chain, and workflow.
• Implementation/Execution: Establishing and conducting operations to
produce goods or services continuously.
• Improvement: Ongoing efforts to enhance efficiency and effectiveness,
incorporating feedback loops and quality management principles.
TRANSITION POINTS: MANAGING INTERSECTIONS Better Managers for a Better World

•From Project to Operations: The handoff from project team to operations team
is critical and must be managed to ensure that operational goals continue to be
met without disruption. This includes training, documentation, and support
systems integration.

•Feedback Mechanisms: Operations often provide valuable insights that can

inform future projects. Effective feedback mechanisms help capture these insights
and translate them into actionable project inputs.
2. STRATEGIC ALIGNMENT Better Managers for a Better World

Integrating Projects with Strategic Operations Goals

Aligning Project Selection with Business Strategy: Projects should be chosen not only for
their intrinsic benefits but also for their potential to enhance operational capabilities or
resolve operational deficiencies. The criteria for project selection should include strategic
relevance to ensure that each project contributes to broader business aims.

Project Portfolio Management (PPM): PPM is a crucial tool for aligning projects with
organizational strategy. By managing and prioritizing a portfolio of projects, organizations
can ensure they are not only aligned with operational needs but also strategically
positioned for future growth and adaptation.
2. STRATEGIC ALIGNMENT (CASE STUDIES) Better Managers for a Better World

Example 1: Technology Upgrade in Manufacturing:

A case study where a manufacturing company implemented a technology upgrade
project aimed at increasing production efficiency and reducing waste. The project was
directly aligned with the strategic goal of cost leadership and had significant positive
impacts on operational performance.

Example 2: Service Expansion in Telecommunications:

This case discusses a telecommunications company that undertook a project to expand
its service offerings. The project was strategically aligned with the goal of market
expansion and involved significant adjustments to operations to accommodate new
services.
TOOLS AND TECHNIQUES FOR STRATEGIC ALIGNMENT
Better Managers for a Better World

• Balanced Scorecard: This tool can be adapted to link project outcomes

with operational performance indicators, ensuring that both areas are
aligned with strategic objectives.

• Strategy Maps: Visual representations that outline the cause-and-effect

relationships between strategic objectives, projects, and operational
processes. These maps help in communicating and understanding the
alignment between strategy, projects, and operations.
BALANCED SCORECARD Better Managers for a Better World
BALANCED SCORECARD Better Managers for a Better World

FINANCIAL MOMENT:
Cash desk: you pay!

ECONOMIC MOMENT:
When you get the ownership of a product (others are limited to get that product)

LIQUIDITY COMES FIRST

BALANCED SCORECARD: A Strategic Management ToolBetter Managers for a Better World

The Four Perspectives of the Balanced Scorecard

1. Financial: Measures reflecting financial performance, such as revenue growth, ROI, cost management. These
indicators help managers see how well the organization is performing financially.

2. Customer: Focuses on customer satisfaction and retention. Metrics might include customer satisfaction
scores, percentage of market share, and customer loyalty indices.

3. Internal Business Processes: Measures related to internal operational performance key to delivering customer
satisfaction and financial returns. Common metrics include cycle times, quality rates, and productivity.

4. Learning and Growth: Looks at the organization’s ability to innovate and improve. These metrics may involve
employees training hours, employees satisfaction, and retention rates, and technological innovation.
IMPLEMENTING THE BALANCED SCORECARD Better Managers for a Better World

Step 1: Define the Vision and Strategic Objectives

Step 2: Develop Metrics and Targets
Step 3: Data Collection and Analysis
Step 4: Implement Initiatives

Benefits of Using the Balanced Scorecard

- Enhanced Strategic Alignment
- Improved Communication
- Better Performance Monitoring
CHALLENGES IN IMPLEMENTING THE
BALANCED SCORECARD Better Managers for a Better World

• Complexity in Developing Metrics: Finding the right metrics that align with
strategic objectives can be challenging and requires deep understanding of both
strategy and operations.

• Data Collection: Gathering accurate and timely data can be resource-intensive.

• Adaptability: The organization must be willing to adapt and change strategies

based on what the metrics reveal.
ENSURING COHERENCE AND SUPPORT Better Managers for a Better World

Communication Strategies: Effective communication channels between project teams and

operations staff are vital. Regular meetings, integrated teams, and shared platforms ensure
that everyone is aligned with the strategic goals.

Cultural Alignment: Developing a culture that values both project success and operational
excellence is crucial. This includes training, shared values, and incentives that align with
achieving both project and operational goals.
STRATEGY MAPS:
VISUALIZING ORGANIZATIONAL SUCCESS Better Managers for a Better World

The Concept of Strategy Maps

Strategy maps allow organizations to depict their objectives in clear, visual formats that illustrate the
causal relationships between different strategic areas. They typically focus on the same four
perspectives as the Balanced Scorecard—financial, customer, internal processes, and learning and
growth—and show how objectives in these areas interconnect and drive each other.

Building a Strategy Map

1. Identify Strategic Objectives
2. Arrange Objectives in Cause-and-Effect Chains
3. Connect Objectives with Arrows
4. Finalize and Communicate
STRATEGY MAPS:
VISUALIZING ORGANIZATIONAL SUCCESS Better Managers for a Better World
STRATEGY MAPS:
VISUALIZING ORGANIZATIONAL SUCCESS Better Managers for a Better World
STRATEGY MAPS:
VISUALIZING ORGANIZATIONAL SUCCESS Better Managers for a Better World
UTILIZING STRATEGY MAPS EFFECTIVELY Better Managers for a Better World

• Communication Tool: Strategy maps are excellent for communicating corporate

strategy across all levels of an organization, ensuring that everyone understands their
role in achieving strategic goals.

• Planning and Execution: They can be used to identify key initiatives and projects
that support strategic objectives, helping align resources and priorities.

• Performance Management: Strategy maps can help managers see how different
parts of the organization contribute to achieving strategic goals, which can be
particularly useful in performance reviews and operational adjustments.
CHALLENGES IN CREATING STRATEGY MAPS Better Managers for a Better World

Complexity in Visualization: Creating a clear and effective strategy map can be

challenging, especially for complex organizations with many interrelated objectives.

Dynamic Environments: Strategy maps need to be updated regularly to reflect the

changing external and internal conditions affecting the organization.

Buy-in Across the Organization: Effective strategy maps require understanding and
support from all levels of the organization, which can be difficult to achieve without
proper communication and engagement strategies.
3. RESOURCE ALLOCATION AND UTILIZATION Better Managers for a Better World

Balancing Resource Allocation Between Projects and Operations

1. Assessing Resource Availability: Begin with a comprehensive assessment of
available resources, including personnel, technology, finances, and time.
Understanding what is available is crucial for effective allocation.
2. Prioritizing Resource Needs: Both projects and operations must be prioritized
based on their strategic importance and resource intensity. This prioritization helps in
making informed decisions about where to allocate scarce resources for maximum
impact.
3. Developing Resource Allocation Strategies: Implement strategies that balance the
short-term needs of projects with the long-term demands of operations. Techniques
such as resource leveling and resource smoothing can be applied to optimize the use
without overburdening resources.
TECHNIQUES FOR EFFECTIVE RESOURCE UTILIZATION
Better Managers for a Better World

Resource Sharing: Implement systems that allow resources to be shared between

projects and operations without conflict.
Capacity Planning: Use capacity planning tools to ensure that the workload is
matched to resource availability, minimizing bottlenecks and idle times.
Performance Monitoring: Continuously monitor how resources are being used across
projects and operations.
TECHNIQUES FOR EFFECTIVE RESOURCE UTILIZATION
Better Managers for a Better World

Resource Sharing: Implement systems that allow resources to be shared between

projects and operations without conflict.
Capacity Planning: Use capacity planning tools to ensure that the workload is
matched to resource availability, minimizing bottlenecks and idle times.
Performance Monitoring: Continuously monitor how resources are being used across
projects and operations.
4. PERFORMANCE METRICS Better Managers for a Better World

Establishing Performance Metrics

• Identification of Metrics: Begin by identifying which metrics are most relevant to the goals of projects and
operations. Metrics should be SMART: Specific, Measurable, Achievable, Relevant, and Time-bound.

•Metric Categories:
• Efficiency Metrics: Measure how resources are utilized and how effectively projects and operations
convert inputs into outputs. Examples include resource utilization rates, cycle time, and throughput.
• Effectiveness Metrics: Assess the success in meeting the strategic objectives. These include ROI, customer
satisfaction ratings, and market share for projects, and quality rates and compliance levels for operations.
• Innovation Metrics: Evaluate the performance in terms of innovation and improvement, crucial for long-
term sustainability. These might include the number of new products developed, patent applications, or
improvements in processes.

We will see some of them

 Better Managers for a Better World
BREAK-EVEN POINT

The "break-even point" is a fundamental concept in business and

economics. It refers to the level of sales or revenue at which total
costs equal total revenue, resulting in neither profit nor loss. In other
words, it's the point at which a company neither makes a profit nor
incurs a loss. Beyond this point, every additional sale contributes to
profit.
 BREAK-EVEN POINT

Better Managers for a Better World

 Better Managers for a Better World
CASH FLOW

Net amount of cash being transferred in and out of a

business during a given period of time

Important:
Cash flow refers to the net balance of cash moving into and out of a business at
any point in time. It is not to be confused with profit, as it only measures the
cash transactions, ignoring other forms of revenue that haven't been collected or
expenses that have not yet been paid.
 PAYBACK PERIOD

Better Managers for a Better World

 Better Managers for a Better World
PAYBACK PERIOD

Number of years necessary for the complete

compensation of investments

Important:
The Payback Period is the time it takes for the cumulative
returns from an investment to equal the cumulative costs,
essentially measuring how long it takes for an investment
to become profitable.
 PAYBACK PERIOD (simple formula)

Better Managers for a Better World

 Better Managers for a Better World
ROI
“ROI (Return on Investment) is a performance measure used to evaluate
the efficiency of an investment or compare the efficiency of a number of
different investments. ROI tries to directly measure the amount of return
on a particular investment, relative to the investment’s cost”.
Source: Investopedia

“ROI is a simple ratio of the gain from an investment relative to its cost. It
is a versatile and straightforward metric for assessing the profitability of
an investment, calculated by dividing the net profit by the initial cost of
the investment, then multiplying the result by 100 to get a percentage”
Source: The Balance Small Business
 Better Managers for a Better World
ROI

•Net Profit is the gain from the investment minus the cost of the investment.
•Investment Cost is the total amount initially invested.

This formula will give you the ROI as a percentage, which helps in easily
comparing the efficiency of different investments.
5. CHANGE MANAGEMENT Better Managers for a Better World

Understanding Change Management in Project and Operations Management

“Change Management refers to the approach and processes used to prepare, support, and help individuals,
teams, and organizations in making organizational change”.

Context: In the realms of project and operations management, change management plays a critical role in
ensuring that adjustments to projects or operations are smoothly implemented, minimizing disruptions while
maximizing the benefits of change.
5. CHANGE MANAGEMENT (2) Better Managers for a Better World

Key Principles of Change Management:

1. Communication
2. Leadership
3. Engagement
4. Training and Support
5. CHANGE MANAGEMENT Better Managers for a Better World

Strategies for Implementing Change in Projects and Operations

Step-by-Step Approach:
• Assess: Identify the need for change and the desired outcomes.
• Plan: Develop a clear, actionable change management plan.
• Implement: Execute the change management strategies.
• Review: Evaluate the effectiveness of the change and make necessary adjustments.

Integration with Project and Operations Management:

• Ensure changes in projects align with operational capabilities and business strategies.
• Use project management tools to monitor change progress and impact.

Overcoming Resistance:
• Understand the root causes of resistance.
• Address concerns through dialogue, transparency, and involvement.
6. RISK MANAGEMENT Better Managers for a Better World

“Risk Management involves identifying, assessing, and prioritizing risks followed

by coordinated efforts to minimize, monitor, and control the probability or impact
of unfortunate events”.

Relevance: Essential for preventing potential project failures and operational

disruptions, ensuring that both domains can thrive even under uncertain
conditions.

Objectives:
• Minimize potential negative impacts on projects and operations.
• Enhance decision-making through better understanding of risks and their
implications.
6. RISK MANAGEMENT (2) Better Managers for a Better World

Risk Identification and Analysis

Identifying and Analyzing Risks in Projects and Operations

Risk Identification:
• Use tools like brainstorming, Delphi technique, SWOT analysis, and checklists
to identify potential risks in projects and operations.
• Importance of continuous monitoring to detect new risks as they emerge.

Risk Analysis:
• Qualitative Analysis: Assess risks based on their probability and impact using a
risk matrix.
• Quantitative Analysis: Use numerical methods like Monte Carlo simulations
and sensitivity analysis to predict the effects and likelihood of risks.
6. RISK MANAGEMENT (3) Better Managers for a Better World

Risk Response and Monitoring

Risk Response Strategies:

• Avoidance: Eliminating a risk by altering project plans or operational strategies.
• Mitigation: Reducing the likelihood or impact of a risk through intermediate steps.
• Transfer: Shifting the impact of a risk to a third party, such as through insurance or
outsourcing.
• Acceptance: Acknowledging the risk and preparing contingency plans if the risk event
occurs.

Monitoring and Review:

• Regularly review and reassess risks and their management approaches.
• Update risk management plans as projects progress and as operational environments
change.
7. TECHNOLOGICAL INTEGRATION Better Managers for a Better World

“Technological integration involves incorporating advanced technologies into project

management and operations to streamline processes, increase efficiency, and enhance
decision-making”.

Importance: In today's digital age, integrating technology is crucial for maintaining

competitive advantages, adapting to market changes, and improving overall organizational
performance.

Key Technologies:
• Project Management Software (e.g., Asana, Trello, Microsoft Project)
• ERP Systems (Enterprise Resource Planning)
• AI and Machine Learning for predictive analytics and automation
• IoT (Internet of Things) for real-time data collection and monitoring
7. TECHNOLOGICAL INTEGRATION (2) Better Managers for a Better World

Advantages of Integrating Technology in Management Practices:

Efficiency and Speed

Enhanced Data Analytics
Improved Communication and Collaboration
Scalability and Flexibility
7. TECHNOLOGICAL INTEGRATION (3) Better Managers for a Better World

Implementing Technological Solutions

Assessment and Planning:

• Conduct a needs assessment to determine the most beneficial technologies for your specific
project and operational needs.
• Plan integration with a focus on minimal disruption and maximum uptake.

Training and Support:

• Invest in training programs to ensure that staff are equipped to use new technologies effectively.
• Provide ongoing support to address technical issues and user concerns.

Continuous Evaluation and Adaptation:

• Regularly evaluate the effectiveness of the implemented technology.
• Be prepared to adapt and upgrade technology as new advancements emerge and business needs
evolve.
8. CASE STUDY Better Managers for a Better World

WITH A GUEST LECTURER

Thank you

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