1. MITM743 Advanced Project Management Dr. Abdul Rahim Ahmad Assoc. Professor College of IT, UNITEN Kerzner Chapter 13 Informal Project management Chapter 15 merger and Acquisition

2. Contents (Chap 13 and 15 of Kerzner) Informal Project Management Informal versus formal Project Management Trust Communication Cooperation Teamwork Effect of mergers and acquisition Planning for Growth Project Management Value-Added Chain Value Chain Strategies Failure and Restructuring

3. Introduction Formal Project management are supported by documentation: Policies and Procedures and forms – part of written proposal and the norms Informal project management do not have proper documentations

4. 13.1 Informal vs Formal Project management

8. Formal vs Informal Project Management FactorFormal PMInformal PM Project management’s level HighLow to middle Project management’s authority DocumentedImplied PaperworkExorbitantMinimal PM documentation evolves: Life cycle phases in 70s Policy and Procedure Manuals in early 80s Guidelines per lifecycle phase in mid 80s General project guidelines in late 80s Checklist and periodic review forms in the 90s (During PM with concurrent engineering)

9. PM with Concurrent Engineering Project activities done in parallel Shortened product development times No Guidelines (Formal) Replaced by checklist (informal and less detailed) Moving from Formal to informal require Trust Communication Cooperation Teamwork Applied to Smaller companies/organizations Can mix formal and informal on different projects within an organization

10. 13.2 Trust

11. Trust How to build trust in a team ? http://www.wisewaysconsul ting.com/how-do-we-build- trust-in-a-team/ ? http://www.wisewaysconsul ting.com/how-do-we-build- trust-in-a-team/ Building a Culture of Trust https://www.linkedin.com/p ulse/20140427213220- 9454814-building-a-culture- of-trust Building Trust among the team (Slide)Slide Trust  Trust is in our everyday life. How?  Key to Successful implementation of Informal Project management  Reduce paper work  Build relationship between contractor/subcontractor and client

12. 13.3 Communications

13. Communications  Through meetings, status reports daily/weekly/monthly  Communication:  downwards  Upwards  Horizontal  Verbal and informal  Information on:  Decisions made  Work authorizations  Negotiations  Project reports  Issues:  Downward communication problems?  Upward Communcation ?  Which one more important? Internal vs external?  Communication for Effective Project management  http://www.project-management-skills.com/different- types-of-communication.html http://www.project-management-skills.com/different- types-of-communication.html

14. Upward, Downward, Horizontal (lateral) Communications

15. 13.4 Cooperation

16. Cooperation  Willingness of individual to work with others for the benefit of all  Includes voluntary actions of a team working together towardsa a favourable results  In companies excellent in project management:  cooperation is the norm and takes place without formal intervention  Team members know what are the right things to do.  In average companies :  cooperation needs to be built.  It takes time  Some companies create cultures that promote cooperation

17. 13.5 Teamwork

18. Teamwork  Work performed by people acting together with a spirit of cooperation under the limits of coordination.  Not to be confused with morale.  Morale has more to do wit work itself  Good morale is beneficial to teamwork  Characteristics of teamwork  Employees and managers  share ideas  Trust each other  Loyal to each other  Committed to work they do  Keep their promises  Share information freely  Consistently open and honest with each other  Issues in teamwork?  Lack of the above characteristics

19. 15 Effect of Mergers and Acquisitions on Project management 15.1 Planning for Growth

20. Planning for Growth Mergers and acquisitions are both aspects of strategic management, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or new location, without creating a subsidiary, other child entity or using a joint venture.strategic management companiesentitiesjoint venture M&A can be defined as a type of restructuring in that they result in some entity reorganization with the aim to provide growth or positive value. Consolidation of an industry or sector occurs when widespread M&A activity concentrates the resources of many small companies into a few larger ones, such as occurred with the automotive industry between 1910 and 1940.restructuringConsolidationautomotive industry The distinction between a "merger" and an "acquisition" has become increasingly blurred in various respects (particularly in terms of the ultimate economic outcome), although it has not completely disappeared in all situations. From a legal point of view, a merger is a legal consolidation of two companies into one entity, whereas an acquisition occurs when one company takes over another and completely establishes itself as the new owner (in which case the target company still exists as an independent legal entity controlled by the acquirer). Either structure can result in the economic and financial consolidation of the two entities. In practice, a deal that is a merger for legal purposes may be euphemistically called a "merger of equals" if both CEOs agree that joining together is in the best interest of both of their companies, while when the deal is unfriendly (that is, when the management of the target company opposes the deal) it is almost always regarded as an "acquisition".euphemisticallyCEOs WikiPedia Growth  Companies grow  Internally  Externally  Internally  Companies cultivate their resources from within  Can spend years attaining strategic target and positioning in marketplace  New development must fit corporate project management methodology and culture  Externally  Can be obtained through  Mergers  Acquisition  Joint ventures  Purchase expertise they need very quickly  Need access to capital to take over companies  What happen when merger/acquisition and joint venture happens  Impact on project management?  Transfer best practices from one to another?  Impact on mergers and acquisition is irreversible  Impact on joint ventures - terminate

21. Mergers and Acquisitions Effects of Mergers and acquisitions  allows companies to achieve strategic targets  Sharing of assets and capabilities  Focus on 2 components  Pre-requisite decision making  Post acquisition integration of processes  Need integrated project management  Immediate impact  Join markets  Long term  Products needs to be developed to satisfy both markets  The Best is to  Combine processes  Share resources  Transfer intellectual property  Examples of mergers and acquisitions?  HP took over Compaq which took over DEC  Oracle took over Sun  Google took over Waze

22. 15.2 PM Value Added Chain

23. Value Added Chain PM Value Added Chain  Value  Ability to maintain certain revenue stream  A competitive advantage that a company possess as a result of customer satisfaction, lower cost, efficiencies, improved quality, effective utilization of personnel and implementation of best practices.  Value can be analyse by looking at Value Added Chain  Stream of activities from the upstream suppliers to downstream customers.  Each component of the value chain can provide a competitive advantage and enhance the final deliverable or service Example diagram of a company’s value added chain

24. End of Slide

25. Project Management…. Work Smart Not Hard !!!