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HEPL 3112 TOPIC 2 NOTES.pdf - SESSION TWO: PROJECT...

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1 |P a g eSESSION TWO:PROJECT (CONTEXT) ENVIRONMENTProjects are influenced by a multitude of factors which can be external or internal to theorganization responsible for its management and execution. The important thing for the projectmanager is to recognize what these factors are and how they impact the project during variousphases from inception to final handover, or even disposal. These external or internal influencesare known as the project context or project environment.The external factors making up this environment are the client or customer, various externalconsultants, contractors, suppliers, competitors, politicians, national and local governmentagencies, public utilities, pressure groups, the end users and even the general public.Internal influences include the organization’s management, the project team, internaldepartments (technical and financial) and possibly the shareholders.All these influences are neatly encapsulated by the acronym PESTLE, which stands for: •Political • Economic • Social • Technical • Legal • EnvironmentalPoliticalThere are two types of politics.First, there are the internal politics that inevitably occurs in all organizations whethergovernmental, commercial, industrial or academic, and which manifest itself in the opinionsand attitudes of the different stakeholders in these organizations. These stakeholder’srelationships to the project can vary from the very supportive to the downright antagonistic,but depending on their field of influence, they must be considered and managed. Even withinan apparently cohesive project, team jealousies and personal vested interests can have adisruptive influence that the project manager has to recognize and diffuse.The fact that a project relies on clients, consultants, contractors (with their numeroussubcontractors), material and service suppliers, statutory authorities and, of course, the enduser, all of which may have their own agenda and preferences, gives some idea of the potentialpolitical problems that may occur.Second,there are the external politics, over which neither the sponsor nor the project managermay have any control. Any project that has international ramifications is potentially subject todisruption due to the national or international political situation. In the middle of a project, thegovernment may change and impose additional import, export or exchange restrictions, imposepenal working conditions or even cancel the contracts altogether. For overseas constructioncontracts in countries with inherently unstable economies or governments, sudden coups orrevolutions may require the whole construction team to be evacuated at short notice.Such a situation should be envisaged, evaluated and planned for as a part of the political riskassessment when the project is first considered. Even on a less dramatic level, the politicalinterplay between national and local government, lobbyists and pressure groups has to be takeninto consideration, as can be appreciated when the project consists of a road bypass, reservoir,power station or airport extension.

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Term
Fall
Professor
NoProfessor
Tags
Project Management, project manager

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