Title - Successful Agile Project Management in the Chemical Industry (Specialization: HR)

Title - Successful Agile Project Management in the Chemical Industry

(Specialization: HR)

Introduction

Project management is today a current and highly discussed area. How projects within the chemical industry are managed has not changed significantly during the last decades. The chemical market, the number of different actors and the way that projects are procured today has however changed. This has led to a gap between the managerial view on how the projects should be conducted today and how they actually are executed (Charvat, 2003). This is reason enough to question this conservative industry and look into what possibilities there might be in the future.

The Agile project management approach evolved from the software industry where it has grown and developed through empirical progress. It is suited for large complex projects where it is difficult to specify the product in advance (Barker, Tjosvold & Аndrews, 2005). It is today used in different industries but mostly in the software business where the customer detects their needs through means of repeated tests and improvements to a prototype.

Chemical industry is a multibillion industry across worldwide and one of the most dynamic businesses available. Good project management plays an important part in gaining success on complex projects (Belout, 2005). This report will research on what opportunities there might be in implementing the agile project management approach in the design phase of projects in the chemical industry.

The major advantages found with implementing the agile approach is an increase in the client’s involvement. The Agile approach almost forces the client to increase their participation in the project compared to the situation today. It can also decrease uncertainty and improve risk management. By the use of time management and specific meetings it will also be beneficial for keeping track of the project’s progression and status.

Importance of the Study

”Project management is today a current area undergoing intensive development” (Clark & Wheelwright, 2003). Finding the optimal way of managing, control and coordinate projects is a constant challenge (Clark & Wheelwright, 2003). Adjusting working methods, clarifying roles, simplifying project reporting or visualizing the project-status through new user-friendly management tools are examples of how this challenge can be met. Project management today often concerns the entire organization whether it is a small private company or a larger public business. If you think about it, the whole idea of a tradition causes us to turn off our brains. Just blindly follow the past so you don't have to do the hard work of critical thinking in the present (Archibald, 2002)

The traditional way of managing projects has been around for half a century and is still the basis on which chemical business relies. The way that projects are actually conducted has, however, changed. The gap between an old view on managing chemical projects and a new way of actually conducting them creates an uncertainty and anxiousness within the business and its employees. People in the chemical business today are at times aware that they are working in a way that is not always according to the managerial view causes confusion. To examine and define the way projects are actually managed and conducted today may ease the uncertainty and confusion. Another option might be to investigate the possibilities of using an already defined and tested management approach, which is the topic of this thesis. Whichever solution one chooses to pursue there is a need to question the traditions of the chemical industry and look at the possibilities of the future.

It the beginning of a project, when the amount of money spent in the project is at its low point, the possibilities of influencing the design and the direction of the project is at its highest (Archibald, 2002). This is illustrated in Figure 1, which also shows that the ability to influence the project decreases with time while the amount of money spent increases. Once the project has initiated the initial phase, changes made can become very costly both in time and in actual money spent. While the money spent in a project increases the ability to influence it decreases (Ashforth & Mael, 2005).

Furthermore, there are projects in which the time during the initial phases is a restricting factor when producing the required documents and investigating the necessary components. Therefore the material produced during these phases can include mistakes and errors. These will only be amplified the further one get into a project before they finally surface, at which point it may be too late or costly to correct it.

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