What are business projects?

The most obvious beginning of the design activity for contemporaries is the creation of pyramids and other majestic structures. Most likely, this is not the case, and projects as a phenomenon arose much earlier. And their history is the same age as the earth's civilization. Today there are many types of project activities. Building and repairing your own home, scientific research, space flights, government modernization, educational programs, the 2018 FIFA World Cup. In a word, do not count. A business project is a special category of projects, they are used only by commercial companies for the purpose of future profit.

The essence of projects in business

Projects as a means of solving business problems are closely related to the company's strategy. The result of any developed strategy, brought to the tactical level, is a plan of strategic measures. Based on this plan, a portfolio of enterprise projects is being developed. And only then does it become possible and necessary to organize individual business projects. This is the typical logic of transferring the strategy to the level of practical implementation.

What is the essence of the task set by the company's management? The essence of understanding the project is determined by three points included in its definition.

The company has localized goals that it intends to achieve.
The management of the enterprise sets time limits to achieve this goal.
Achieving a goal involves a non-repetitive activity (not the usual production of products or services). The prescribed activity is unique.

Business projects are understood as the activities of a commercial organization with the aim of creating unique products or services under budgetary and time constraints. Projects in the business sector bear the features of business tasks. That is, pursuing specific goals, they serve to achieve the desired results, directly or indirectly aimed at making a profit in the future.

Almost all business tasks are unique and are divided into two large groups: cyclically reproducible tasks, classified as business processes, and unique tasks - those same projects. The more experience the company has gained in the implementation of certain projects, the lower the level of their uniqueness, the more they gravitate towards processes. The development of business processes just gives the result when a once unique task enters the cycle.

This happens quite often. Let's take an example. It is more profitable to create and replicate a branch network on the basis of the described business processes “Opening a branch of a company”. However, it can be said with certainty that the company that adopted the branch network development strategy opened the first three branches in the form of business projects. And only when the creation of all three divisions was completed, the management had a desire to reduce project budgets, describe the accumulated experience, and put the procedure on stream. On this basis, the development of a new business model and the description of the corresponding process are carried out.

Types and place of projects in the company

We have already noted that the essence of business projects is well revealed through the strategic model for the implementation of the company's development. The strategy “goes down” thanks to the BSC tools to the grass-roots processes of the main production, passing through the middle zone, called “Programs and Development Projects”. Inside the main production, there is the option of deploying the so-called "Design Production", which is the specifics of certain types of business. An idea of the architecture of such a translation of the strategic plan will help to draw up the Pyramid of the implementation of the strategy, which is offered to your attention below.

Pyramid of the implementation of the strategy of a commercial organization

Thus, there are two main forms of projects in business: development projects and contract projects (also called project production). The first category represents more unique development challenges. To solve them, completely heterogeneous resources are used, the tasks for which are not set at the portfolio level. On the contrary, it is important to provide each project with sufficient resources and its implementation in business structures (organizational, financial and informational). Here are some examples of such projects:

entering new markets;
launching new products or services;
scaling production;
marketing campaigns;
internal projects related to the reorganization or implementation of IT systems;
mergers and acquisitions.

The essence of contract projects is determined by the industry of the company. Project-based manufacturing represents those companies that make money by implementing projects as ways to create a product. They create portfolios of orders, plan individual projects within them. It is important for such manufacturing firms to manage not individual projects, but at the portfolio level. For them, it is of great importance how planned and optimized the resources are, the performers of the tasks. A feature of this form is the homogeneity of resources, since they are of a production nature. Examples are:

construction companies;
IT firms;
small-scale and piece production;
consulting business.

Business project management

It should be noted right away that often even experienced businessmen confuse the concepts of a project and a business plan. This should be dealt with, otherwise difficulties will arise later. Which of these two concepts is "chicken" and which is "eggs"? Naturally, the project is primary, and the business plan is secondary.

In other words, it is possible to draw up a business plan only after the project to open a new business or a new line of activity has been launched. On the contrary, it won't work. The result of the project is, for example, a new business, and the result of planning is the development of the Business Plan document as a justification for launching the project for investors and the customer.

Writing a business plan means completing a step in the planning process that is part of a project management system. What else is included in business project management besides planning? As a system of applying knowledge, skills, methods and technologies to perform a unique task, management serves the purpose of meeting expectations. The structure of this system includes at least seven components.

Project initiation.
Charter preparation.
Selection and appointment of PM.
Planning.
Organization of performance.
Monitoring and control.

It is worth noting that the second and third list items are not considered as separate management processes in the PMBOK PMI guide. Nevertheless, the preparation of the charter and the appointment of a project manager, especially in Russian conditions, are very important positions in the implementation of a unique development task. The interaction of management processes has a rather complex architecture of connections, its work flow diagram is presented to your attention below.

Diagram of the interaction of project management processes

This diagram shows the five main groups of processes initiating, planning, executing, controlling and closing. The structure of connections between them allows different interpretations. And no matter what the scale of the project, it may be small, but in any case, its leader will face the need to more or less act according to the presented model. Otherwise, the creation of the project as a regulated and productive task may fail.

Project management success criteria depend on three key parameters: content, constraints, and . The structure of the project is determined by the correctness of the chosen goals, effective organization of management, technical and resource support for the task. The larger the project, the more complex it is, the higher the importance of the management component and technical and resource support. These two components complement each other.

In this article, we have managed to distinguish projects in commercial organizations from other types of projects and business plans. Thus, misconceptions existing in practice are dispelled. We examined the main essential points, concepts and contents of the project task, confirmed the obligatory nature of its connection with the company's strategy as a way to develop activities with a given target setting. In addition to the essence of the project as such, a system of management processes consisting of seven main components is briefly presented. All this allows the reader to tune in to the fundamentals of project management and move on with the basic understanding received.