The Structure of High-Performing Project Management Organizations
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0092-8615/98 Copyright 0 1998 Drug Information Association Inc.
THE STRUCTURE OF HIGH-PERFORMING PROJECT MANAGEMENT ORGANIZATIONS* RANDOLPHH. CASE,PHD Assistant Professor, Operations and Strategic Management Department, Boston College, Boston, Massachusetts
This paper explores how project management performance varies with the degree to which development projects are “integrated” with the organization(s) that manages them. Integration is measured over multiple dimensions and related to pe$ormance as rated by managers of I5 pharmaceutical firms and their 11 7drug development projects. Preliminary results support the theory that “dis-integrating” the project from the traditional functional hierarchy can provide the “distance” necessary f o r high-performance product development. Key Words: R&D; Project management; Virtual organization; Development; Performance
EXECUTIVE SUMMARY THE PHARMACEUTICAL INDUSTRY is under increasing pressure to develop innovative new drugs faster and more cost effectively than ever before. In an attempt to better manage the drug development process, many pharmaceutical companies have implemented “project management” processes and techniques. The ensuing document reports the results of a two-year study that sought to identify how various approaches to pharmaceutical project management impact organizational effectiveness. This study represents the first research project funded by the Pharmaceutical Education and Research Institute (PERI) on behalf of member firms of the Pharmaceutical Research and Manufacturers Association (PhRMA). The study was conducted in 20 PhRMAmember firms ranging in size from small *Research supported by: Pharmaceutical Education and Research Institute (PERI) and members of the Pharmaceutical Research Manufacturers Association (FhRMA). Reprint address: Professor Randolph H. Case, OSM Department, Boston College, Chestnut Hill, MA 02167.
“biotechnology” firms to large multinational pharmaceutical companies. The identity of the 20 firms is held confidential. Objective survey data were gathered from 117 development projects in these firms by an independent research team at Boston College. The data were collected from sources including written questionnaires filled out by project leaders and personal interviews with top research and development (R&D) management. Statistical analyses regressed various project management (PM) characteristics against measures of organizational effectiveness at both -the project level and the level of the development portfolio. The results indicate that two emerging trends in pharmaceutical project management-that of the “virtual” project, and that of the “empowered” project team-both can contribute to the effectiveness of drug development. The virtual project is one in which:
1. The locus of the project and project work can be off-sight and potentially at a considerable distance from functional management, 577 Downloaded from dij.sagepub.com at Purdue University on May 18, 2015
Randolph H. Case
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2. The ownership of the project can be
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