Projects aren’t executed in a vacuum. It’s easy to get lost in the planning and execution as these are foundational processes that help deliver successful projects. However, you can’t forget the context of the project, which is what enterprise environmental factors (EEF) cover.
Enterprise environmental factors help a project maneuver through the often knotty threads of the cultural, political, legal and environments in which a project is being done. Read on and we’ll get into all that and more in detail.
What Are Enterprise Environmental Factors?
Enterprise environmental factors can be defined as conditions that aren’t under the immediate control of the project team or project management office. These constraints include the cultural, political, legal and environmental landscape in which the project is being executed. These can influence the outcome of the project, program or portfolio so they must be managed.
Both being beyond the control of the project team, and even the organization that initiated the project, enterprise environmental factors can affect the outcome of the project, both negatively and positively. These enterprise environmental factors are even broader in scope as they can occur within the organization initiating the project and outside of it.
That’s why project managers and their teams need to take time to identify enterprise environmental factors that might influence their projects and figure out an action plan to mitigate or respond to them in a timely, effective manner. This systematic analysis of external and internal environmental factors is part of the larger strategic management of a project.
First, you need to identify the enterprise environmental factors by listing the internal and external ones. An EEF project management tool is a SWOT analysis, which can help identify enterprise environmental factors and determine their strengths, weaknesses, opportunities and threats. That’ll make it easier to know how to assess and plan for their potential effect on the project.
Project management software can facilitate this process. ProjectManager is award-winning project management software that has risk management features that can help you identify, plan and track enterprise environmental factors in your projects. Users can manage risk, issues and changes on task cards that can describe your response, note the impact on and likelihood of it occurring in the project, assign team members to own and mitigate the issue, prioritize it and much more. Then you can track the progress in real time to ensure the project is delivered on time and within budget. Get started with ProjectManager today for free.
Enterprise Environmental Factors vs. Organizational Process Assets
There are many enterprise environmental factors to take into account. This means there are policies, practices, procedures and legislation both inside and outside an organization that must be managed.
Organizational process assets (OPA) are used to improve the management of both projects. The organization over time will have a wide range of templates, contracts, registers and assessment tools to better manage their projects. These can include standardized guidelines, proposal evaluation criteria, work breakdown structure templates and more.
That doesn’t mean that the line between the two is solid. There are examples of internal policies that fall under enterprise environmental factors and organizational process assets that can be more confusing to separate. Think about an organization’s computer systems, networks and software, which are instrumental in EEF project management, however, specific policies, processes and data fall under organizational process assets.
Organizational process assets will improve the management of projects that are being managed within the constraints established by enterprise environmental factors.
Why Are Enterprise Environmental Factors Important in Project Management?
All the projects and programs that a company executes should be closely tied to its strategic plan, which is a snapshot of its business strategy. Strategic plans are influenced by the enterprise environmental factors so all these factors should be factored in at the very beginning of a project.
Setting up these procedures is the responsibility of a project management office (PMO), While not all organizations have a PMO overseeing these responsibilities, it’s sometimes under the purview of the project manager, PMOs are in charge of coordinating all project, program and project portfolio management related activities.
This is important because environmental factors are all the internal and external influences on how projects are prioritized, planned and executed. This, in turn, can impact the outcome of the project. Therefore, it’s as important to the success of the project as staying on schedule, keeping to your budget and scope as well as delivering on quality expectations.
1. Internal Enterprise Environmental Factors
We’ve so far talked broadly about enterprise environmental factors, basically breaking them up into two groups: internal and external. It’s time to take a closer look at what these enterprise environmental factors are. Let’s start with those that emanate from within the organization.
Organizational culture is what is shared among the people who make up the organization in terms of a set of visions, missions, values, norms, beliefs and expectations. These are usually developed over time and don’t change quickly or easily.
Project governance is having the objectives of a project, program or portfolio align with the larger strategic goals of the organization. This framework offers project managers and their teams a structure by which they can make decisions and manage projects.
Organizational communications are formed through the organization’s culture and its policies to develop staples, processes and media. It informs the level of formality when communicating with teams and stakeholders as well as the acceptable channels used for those communications.
Organizational structure determines the arrangement of reporting hierarchies in the organization, such as the reports created by the project manager and presented to stakeholders. It also speaks to the authority of the project manager, the availability of resources, who’s in charge of managing the budget and more.
Organizational Process Assets
Organizational process assets, as noted above, are the plans, processes, policies, procedures and knowledge bases that are used by the organization. As with enterprise environmental factors, they’re part of the planning process.
Project Management Information Systems
Project management information systems include scheduling software, configuration management systems, information collection and distribution systems and web interfaces. It holds all the project management documents and possibly parts of the project plan, but it’s not a project plan, schedule or budget.
2. External Enterprise Environmental Factors
The other group of enterprise environmental factors are those that are outside of the organization or external. They can include cultural influences, the political climate and much more. Let’s define a few of the major external enterprise environmental factors.
Market conditions are several factors, such as the number of competitors an organization has, the organization’s ability to stay competitive and changes that have occurred or are occurring that impact the economic environment for the organization.
Economic trends are part of market conditions but are a category unto itself. It refers to the overall state of the economy, where interest rates are, currency exchange rates, etc. Many of these economic factors can have an impact on project, program and portfolio costs.
Legal Restrictions and Regulations
Legal restrictions and regulations cover any federal, state, local or foreign statute, law–including common law–regulation, ordinance, code, rule, judgment, order, writ, injunction, decree, permit, concession, grant, franchise, license, agreement, etc. This can prohibit organizations from various activities when managing their projects and, therefore, needs to be understood and adhered to.
How to Identify Enterprise Environmental Factors
As mentioned earlier, one of the first activities done in the planning stage of a project, program or portfolio is to identify the enterprise environmental factors. We spoke briefly about a SWOT analysis, but more tools can help. Let’s discuss a SWOT analysis in more detail and two other ways to help you identify enterprise environmental factors.
A SWOT analysis is a framework that is used in strategic planning. SWOT is an acronym for strengths, weaknesses, opportunities and threats. It identifies these categories inside and outside an organization and helps to achieve an organization’s objectives or make decisions.
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SWOT Analysis Template
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PESTLE analysis is another acronym, this one stands for political, economic, social, technological, legal and environmental. This is a more rigorous strategic planning tool than a SWOT analysis when performing an industry analysis and identifying various enterprise environmental factors that will affect a project, program or portfolio.
Porter’s Five Forces
Porter’s Five Forces is a model that helps to identify and analyze five competitive forces: the competition in the industry, potential new entrants into that industry, power of suppliers, customers and the threat of substitute products. This will help guide business strategy and better an organization’s competitive advantage.
How ProjectManager Helps Manage Enterprise Environmental Factors
Once you’ve identified and assessed the enterprise environmental factors that can impact your project, program or portfolio, you’re going to need project management software to manage them when planning and executing your work. ProjectManager is award-winning project management software that helps you plan, manage and track enterprise environmental factors in your projects, programs and portfolios. Our project portfolio management software allows users to group and organize their projects, manage resources and collect real-time data to generate insightful reports.
Create Project Portfolio Roadmaps
Whether you’re managing the enterprise environmental factors on one project or a program or portfolio of projects, our Gantt charts and roadmaps provide a visual timeline to plan, manage and track all your work in real time. Users can link dependencies, filter for the critical path and set a baseline to compare planned versus actual effort to help you stay on track. Roadmaps can be filtered to help you make accurate forecasts, see which projects are open and who’s assigned to tasks as well as showing stakeholders key metrics.
Enterprise environmental factors can impact your project’s performance and progress. Our real-time dashboard and portfolio dashboard give you an instant status report on your projects’ health, time, costs and much more. All metrics are shown in easy-to-read graphs and charts and, unlike inferior alternatives, there’s no time-consuming setup required. It’s ready when you are with an instant status report. Plus, you can build portfolio dashboards with filters to highlight specific insights.
Our portfolio management features include single sign-on, timesheets to track your teams’ hours and how long they’re spending on their tasks, which helps to control labor costs. We also have unlimited file storage so you can store all your project documentation in one accessible place where anyone, at any time, can get to them. You can also archive old projects to have historical data to help you better plan and manage future projects.
ProjectManager is cloud-based project management software that connects teams whether they’re in the office, out in the field or anywhere in between. They can share files, comment at the task level and more to foster better collaboration. Join teams at Avis, Nestle and Siemens who use our software to deliver successful projects. Get started with ProjectManager today for free.