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Benchmarking of Project Planning

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Benchmarking of project planning

and success in selected industries

Ofer Zwikael

Business School, Netanya Academic College, Netanya, Israel, and

Shlomo Globerson

Tel Aviv University, Tel Aviv, Israel

Abstract

Purpose - To identify the industry in which projects are best planned and executed and use it as a

benchmark for improving project planning in other industries.

Design/methodology/approach - Based on data collected from 280 project managers, project

success and quality of project planning were evaluated and analyzed for four industries - construction

and engineering, software and communications, services, and production and maintenance.

Findings - Quality of project planning was found to be the highest in construction and engineering

organizations and the lowest in manufacturing organizations. This is a result of a few factors, among

them the intensive organizational support which is offered to project managers working in

construction and engineering organizations. The other three industries limit their support mostly to

tactical aspects, such as the purchasing of project management software. The high quality of project

planning in the construction and engineering organizations resulted in their ability to complete

projects by almost half the cost and schedule overruns, as compared to organizations belonging to the

other industries. Finally, results of the industries in Israel and Japan are compared and analyzed.

Research limitations/implications - Findings are limited to the four industries included in the

study.

Practical implications - If organizations, not belonging to the construction industry, wish to

improve the probability of success in project planning and execution, they should follow

methodologies commonly used in the construction industry.

Originality/value - This paper introduces a valid field study, exploring project management

practices in four industries and identifies the one which may be used as a benchmark for the others. It

also identifies specific strengths and weaknesses in project management within the explored

industries.

Keywords Benchmarking, Project management, Project planning, Project evaluation

Paper type Research paper

Introduction

Different industries face different challenges while managing projects. For example,

software development organizations have to deal with high technology uncertainty,

while construction organizations are usually more troubled with engineering or finance

problems. Moreover, same processes may have different boundaries in some industry

types (Plemmons and Lansford, 1994). These differences end with as much as

30 percent in project cost and schedule among industries (Lavingia, 2001).

Benchmarking is efficient and frequently used in the project management

environment. For example, when building the Hasbro Children's Hospital in the early

1990s benchmarking "best-in-practice" pediatric facilities was used. The planning

team visited a number of notable children's hospitals, and then shared findings with

other teams. Hasbro's success at incorporating the best processes resulted in the

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1463-5771.htm

BIJ

13,6

688

Benchmarking: An International

Journal

Vol. 13 No. 6, 2006

pp. 688-700

q Emerald Group Publishing Limited

1463-5771

DOI 10.1108/14635770610709059

hospital becoming a benchmark partner for other institutions (Egan, 1996).

Bombardier Inc. used benchmarking in information technologies projects. By

pinpointing problems, the firm saved an estimated $5 million to $6 million on its

annual data center costs alone, or about 1/3 of its data center budget (Buckler, 1994).

The companies included in Benchmark Capital's portfolio improve their projects by

working cooperatively and benchmarking; instead of compete with one another

(Asadullah, 1999). Benchmarking was also introduced in the project management

environment for the fiber optic networks industry (Bachhiesl et al., 2003) and project

management re-use (Cooper, 1993). Finally, Stork (1997) suggests focusing on

effectiveness rather than efficiency when benchmarking for project purchasing.

A common notion presently used in benchmarking organizational capabilities and

analysis differences among industries is called "maturity." There are methods to

evaluate company's maturity, either in general managerial capabilities, for example,

Capability Maturity Model (Paulk et al., 1995) or in specific areas,

...

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