Enterprise Environmental Factors in Project Management | What Are the Enterprise Environmental Factors?
As a project manager, you can face many obstacles or problems during a project. Some of them may be caused by lack of planning or by some other reasons tat you can control. But there will be some conditions which you cannot control as well. These are called Enterprise Environmental Factors.
Even if you cannot have control over Enterprise Environmental Factors, you should be aware of them to plan the project accordingly. Because Enterprise Environmental Factors will be affecting the project. If you don’t act in advance, they can slow down the project or affect the outcomes.
This is briefly the definition of Enterprise Environmental Factors. But what are the examples of Enterprise Environmental Factors? How the Enterprise Environmental Factors affect the project? What should the Project Manager consider about the Enterprise Environmental Factors?
In this article, we are going to review the Enterprise Environmental Factors in Project Management.
What Are The 4 Major Enterprise Environmental Factors?
As a project manager, you will see that Enterprise Environmental Factors are inputs to many processes in Project Management. The conditions that are not under the control of the project team are categorized as Enterprise Environmental Factors. They influence, constrain or direct the project are categorized. That’s why the role of a Project Manager should always include taking the Enterprise Environmental Factors in consideration when planning the project. That’s why enterprise environmental factors are the inputs to most planning processes.
Now let’s list the Enterprise Environmental Factors and give some examples to illustrate these factors better. We can group the Enterprise Environmental Factors in four major groups.
Enterprise Environmental Factor #1: Organizational culture, structure, and governance
As a project manager, you cannot affect the management of your company or management hierarchy of your company. So this can be considered as an Enterprise Environmental factor. However, the approach of your management and hierarchy in the company directly affects project management in a company. So before conducting the planning of the project, you should know the culture and management structure of your company. That’s ideal for avoiding incompatibilities between the project and the company itself.
Enterprise Environmental Factor #2: Government or Industry standards
The government and industry standards directly affect the project but these are some conditions that you cannot control. That’s why they are another example for Enterprise Environmental Factors. If you want to produce health product, let’s say a blood pressure monitor, this must be in compliant with the standards of World Health Organization (WHO). If you will market this product in the USA, it needs to be compliant and approved by FDA. Since these standards will impact your project scope, these are considered as Enterprise Environmental Factors as well.
Enterprise Environmental Factor #3: Political climate
The political climate is very important for projects. For example, if your project will be executed in a country that has an embargo, most probably you will have procurement issues. Or let’s say that during execution of a government project, country of your company and your customer’s company started to have a diplomatic crisis. This might affect your business as well. Therefore, the political climate is an important Enterprise Environmental Factor.
Enterprise Environmental Factor #4: Marketplace conditions
The last Enterprise Environmental Factor example is the Marketplace conditions. Let’s consider that you are working in a company which is having an economic crisis. This will affect the revenue of your company directly. Respectively your projects, especially the budget might be affected as well.
How to Overcome the Possible Negative Aspects of Enterprise Environmental Factors?
As we have stated in the beginning of this article, these Enterprise Environmental Factors are not in your control. That being said with a good planning in which you take these Enterprise Environmental Factors in consideration, they won’t have negative effects in the project. One useful material for you will be the Organizational Process Assets. They are the lessons learned from the previous projects and they build the knowledge base of the company. For instance, if you are a new Project Manager, you can learn helpful information from the procedures and the guidelines, which are considered as Organizational Process Assets.
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