Telekomunikacijski sistemi, d.o.o, Kranj Ljubljanska c. 24a, 4000 Kranj, Slovenia Tel.: +386 4 207 2829, Fax: +386 4 202 1525 http://www.iskratel.si METHODOLOGY OF COMPLEX PROJECT MANAGEMENT IN ISKRATEL Brane Križnar , Majda Stojsavljevič, Iskratel, d.o.o. Kranj, Ljubljanska cesta 24a, 4000 Kranj, Slovenia e-mail: [email protected] , [email protected] ABSTRACT Iskratel is a Slovenian company which produces telecommunication systems and delivers services. The development of new products is becoming increasingly complex; this is why our company felt compelled to implement new methodology of project management supported with appropriate tools. The article describes the role of project management and supporting activities of project office in our development process. Particular emphasis is being placed on implementing the work on projects, running in parallel. KEY TERMS Multiproject Environment Project Management Methodology Project Office 1

Iskratel Case 2002

Embed Size (px)

Citation preview

Page 1: Iskratel Case 2002

Telekomunikacijski sistemi, d.o.o, KranjLjubljanska c. 24a, 4000 Kranj, Slovenia

Tel.: +386 4 207 2829, Fax: +386 4 202 1525http://www.iskratel.si


Brane Križnar, Majda Stojsavljevič,

Iskratel, d.o.o. Kranj, Ljubljanska cesta 24a, 4000 Kranj, Sloveniae-mail: [email protected], [email protected]


Iskratel is a Slovenian company which produces telecommunication systems and delivers services. The development of new products is becoming increasingly complex; this is why our company felt compelled to implement new methodology of project management supported with appropriate tools.

The article describes the role of project management and supporting activities of project office in our development process. Particular emphasis is being placed on implementing the work on projects, running in parallel.


Multiproject EnvironmentProject Management MethodologyProject OfficeDevelopment Project


Iskratel is a company, which succeeded in strengthening its position on the global telecommunications market during the critical years of economic recession. The company even increased its market share. For the first time in the company history, we have sold


Page 2: Iskratel Case 2002

more than a million ports. This impressive result has been achieved thanks to the high technology products. In Iskratel, we are engaged in producing and marketing telecommunications systems and services for IP and TDM networks. In order to sell successfully on the global market of convergence networks, the product diversification strategy is needed with a comprehensive collection of products that are interesting and competitive on the market. By selling them to its customers, the company can satisfy their needs and look for new market opportunities and business partners. The company is building its product strategy in accordance with the trends of the new information infrastructure that is developing towards integration of all the existing networks and upgrades with new IP technologies. The new generation of telecommunications is based on the IP technology. It is called New Generation Network (NGN).

In order to be successful on the market today and to daringly plan competitiveness and an increase in turnover also in the future, clear product vision and ongoing strategic investments are needed. 20 % of the revenues are appropriated by the company for the development of the comprehensive collection of price competitive and state-of-the-art products. Within the framework of the development process, there are more than 200 highly specialised associates participating in developing new products. These colleagues work in various sectors within the research and development department.


The product diversification requires adequate organisational support. Iskratel is organised in business units (BU) that are responsible for the development of single product lines, for turnover and cost control. The business units are organised in profit centres (PC) that are responsible for specific product portfolio or target customers. Profit centres are relatively autonomous entities responsible for their product profitability. Their tasks are: sales budget management, financing plan management, product strategy management and obligation to monitor the entire financial flows of each single product. Research and development (R&D) is organized within BU as a department of common relevance, whose services are utilised by all profit centres, and which is not expected to generate extra profit. Through project managers, it provides project development ordered by profit centres.

New product development is proceeding within the research and development department in a form of projects, ordered by profit centre managers and approved by the product boards of business units. Development engineers work in research and development sectors managed by functional managers. They are responsible for the development of certain functional assemblies such as: hardware development, system software development, applications software development, communications protocol development, and management software development. The project managers who ensure optimum project progress are organised within research and development in the sector of project management, managed by the project management manager. As it is normal that one project manager manages several projects - depending on the functional similarity of the


Page 3: Iskratel Case 2002

projects, project scope or the application domain required by the target customers - it is also possible that one performer collaborates on several projects. According to W. R. Duncan, the project organisation model is called composite organisation. In accordance with this organisation, a certain number of basic research projects are running in product-oriented organisation, other projects are carried out according to the matrix model.

Figure 1: Composite organisation model


Nowadays, only the companies, in which a sufficient number of right ideas generated on time and which launch an adequate number of projects for implementing ideas, are able to survive in competition race. It is important that we are able to offer a customer highly technologically advanced products on time and that the products meet all his expectations and needs, and that we are in a position to obligatorily service and upgrade them tomorrow. Successful implementation of projects is indispensable for establishing the key factors of the company's competitive advantage. In moving towards development project objectives, flexibility, introduction of state-of-the-art technologies, innovativeness, entrepreneurial orientation of the team play an important role at Iskratel.

The main characteristics of development project management at Iskratel are:

A large number of parallel projects


Project BCoordination

Project ACoordination

Page 4: Iskratel Case 2002

The following projects may run in the research and development department: up to 15 market-oriented projects, 2 to 3 technologically-oriented projects, several maintenance projects and usually at least one generic research project.

Complexity of projects There are generic, market-oriented, technological and maintenance projects. The quantity of planned work and the number of the performers needed greatly differ from project to project depending on the type of the project. We may carry out a small-scale project with less than one man-year, on which 5 to 10 performers collaborate. In parallel with it, a generic project can be carried out, where up to 40 man-years are planned and 100 or even more performers collaborate in the course of a project cycle.

Diversity of projects Thematically and technologically, there are highly diverse projects, because we develop entirely different products, e.g. public telephone exchanges, PTSN and ISDN access nodes, IP access nodes, broadband access, exchanges for special networks, centralised management node, IP terminal equipment, service centres, etc.

Highly specialised performers Since thematically and technologically there is a large collection of our products, the performers employed in functionally organized departments are highly specialised experts, for whom there is no immediate replacement without specialising new associates in this particular sphere of activity. This enhances the risk of implementing the projects, but reduces the costs at the same time.

Performers collaborating on more than one project Involvment of the same resources on more than one project is necessary because of the high specialisation of performers.

Maintenance projects We are obliged to promptly and qualitatively service all the products sold and put into operation at a customer's place. Remedy of critical defects in operation has absolute priority.

Problems in precise planning of development activities Disturbances caused by critical defects elimination in servicing the products and unpredictable trouble having arisen due to imperfection of new technologies make the planning rather difficult.

Unplanned projects Sometimes there are projects that need to be inserted between the planned and approved projects due to the sales activities, obligations to customers and because of the wish for market broadening.

Frequently changed priorities The project priorities may change due to the current project status, a delay in project implementation, market situation and obligations to customers.


Page 5: Iskratel Case 2002

Training and synchronising the team The development of an innovative, technologically advanced product requires investments in new skills and the preceding target training of the project team members in order to provide a good project start and thus enhance success.


The complexity of planning, parallel project management, and management of optimum allocation of human resources in multiproject environment are the factors that have prompted the decision to start renovation of project management methodology. The project objective was introduction of information support for planning and monitoring the projects. This provided us with optimum utilisation of resources and better adhering to time schedules. The Primavera Project Planner tools were selected for planning and monitoring the projects. Primavera Progress Reporter is intended for all the performers collaborating on the projects to periodically report on a regular basis.

The project office was established after introduction of new tools. This office offers logistical support to project managers. Its activities are indispensable for planning new projects, for smooth progress of projects and for qualitative monitoring project implementation.

3.1 Procedure After Starting a New Project

When at a PC's request a decision has been made to develop a new product, a new account is opened in the financial system. The new project start is marked with the B50 milestone and the model project plan is entered in the database. For each sector, only one time-limited activity is opened, on which the performers may record preparatory activities for the project.

The project office prepares the new project simulation and thus supplies the project and functional managers with adequate data needed for precise planning. By using the simulation, we ascertain the new project impact on the progress of other projects and prepare a plan of measures that will be taken for prevention of delays in the current projects.

A project is formally started with a kick off meeting (B100 milestone), at which the project is approved by signing the resource requirements form (RR form). At the B100 milestone, the functional managers conclude an agreement with the project managers on deadlines and time investment.


Page 6: Iskratel Case 2002

In special forms, sector managers prepare a detailed allocation of work according to performers, on the basis of which the project office enters the real plan in the database. The project manager is responsible for the plan entry control.

Figure 2: A sample of the sector RR form

3.2 Development Project Phases

For the duration of the development project from B100 (the signing of the RR form) to B600 (the putting of the product into trial operation), the project office task is primarily to prepare periodical reports (weekly, monthly) and to provide all the participants in the development process (product and project managers, sector and group heads and project coordinators and performers) with up-to-the-minute data. All important reports are also displayed on the Intranet project pages and on the single sectors Intranet.

The project office provides the regular project meetings with the reports on critical milestones and activities. This enables the personnel responsible for the projects to take adequate measures to correct critical paths of projects. If necessary, the project office corrects the projects.

3.3 Project Completion

After completing the project, all the activities linked to the project are closed in the project database. At the same time, project maintenance activities are opened for the warranty period that lasts from 3 to 12 months with the total amount of 10% of the formerly planned development work


Page 7: Iskratel Case 2002

3.4 Problems in Introduction of New Methodology

In introducing new methodology, the following problems have been detected: Coordination of plans

It has been rather difficult to reach a harmonized decision on changing the existing plans and priorities;

Delayed reaching of the B100 milestoneIn single sectors, much work on a new project was done prior to signing the RR form, which means that performers were working on unplanned activities; according to the plan they should have been free but in reality they were overburdened

Inappropriate simulation of new projects:The simulation was setting new projects in unreal time schedule; therefore it lacked credibility when negotiations for new projects were in progress.


Figure 3: Diagram of using Primavera tools

4.1 Primavera Progress Reporter

Progress Reporter is an Intranet application (JAVA applet), which is used by all participants in the development process for weekly reports on actual project work and non-project activities. All the activities planned for a particular period of time are on display to each participant on weekly basis.


Page 8: Iskratel Case 2002

When filling in the weekly report, each performer arranges his/her working hours according

to his/her activities. Then one sends this report to ones superior for approval.

After the weekly reports have been approved, the data are transferred to the project database as implementation on single project activities.

Figure 4: Timesheet in Progress Reporter

4.2 Primavera Project Planner (P3e)

Figure 5: Project structure with GANTT diagram


Page 9: Iskratel Case 2002

We have two-level mode of approving the actual work implemented. By means of the P3e tools, the heads of groups review and approve (or reject) the reports written by their associates. Project managers, however, approve monthly implemented work on their projects.

After the project office has transferred the data from weekly reports to the project database, the reports on critical paths on projects are available to all functional and project managers.

4.3 Our Own Upgrades for Project Monitoring Support

It was necessary to develop some additional tools for a link with the existing information system in order to increase effective project monitoring.

We have created an application that enables performers to have online access to the data from the system for recording the working time. They need this information for filling in weekly reports. The performers may now compare the quantity of hours in their weekly reports with the hours recorded in the system for recording the working time.

We have also worked out an application for additional viewing and approving the joint implementation on single projects. Project managers may monthly monitor the actual work, recorded by performers on their projects.

In Excel several reports have been prepared, by means of which the project office provides the persons in charge of the development process with complex information.


The project management of product development stages has achieved great progress at Iskratel lately. It has been achieved by introducing the world-famous tools for planning and for methodological upgrading the process, which is constantly being perfected. Through these approaches, we provide reliable and monitored development project management, which brings us to the desired objective within the projected time, and / or to the product that can be manufactured, that is repeatable, modular and competitive. At Iskratel, we are aware that our project management model is not perfect and that it requires continuous perfecting. Moreover it has to be adapted to the new needs of the market economy. The time needed for development of a new product is becoming increasingly shorter. In parallel with this trend, the approaches to project management are also being modified.


William R.Duncan (1996): A guide to the Project Management: PMIPrimavera Systems, Inc. (2001) Project Manager’s Reference Manual Pučko-Frey M., Meško J. (2000): Rules of Procedure in the Development Sphere of

Activity, Kranj, IskratelPučko-Frey M. (2001): Working with Primavera P3e Application in RD SI2000


Page 10: Iskratel Case 2002