Is it a Project or Operations?

Do you understand the difference between Projects and Operations?

A Project is a temporary endeavor undertaken to create a unique product, service or result. Temporary means having a definite beginning and end. The end is reached when the project’s objectives have been achieved, or if the project is terminated.  Projects creates a unique product, service or result. There may be some repetitive elements present in each project, but the output must be unique.

Operational work is generally an ongoing, repetitive process because it follows an organization’s existing procedures. The ongoing execution of activities that produce the same result or product repetitively is what Operations is all about.  For example, production, accounting, and manufacturing operations are all Operational activities.

Operations are permanent initiatives that produce repetitive results, with resources assigned to do the same set of tasks and produce a standard output.

Key Differences Between Projects and Operations

The distinction can be a bit confusing to discern.  For example, In the life of a product, there will be many projects to improve the product, adding new features etc. and these projects will come and go as required. But, the underlying production of the product will continue as usual.

Projects require project management, while operations require business process management or operations management. Projects and Operations will interact with each other at key points in a product’s life cycle.  Both projects and operations are carried out by people, both require planning, both require management, and both are constrained by a fixed amount of budget, resources, and timelines.

Let’s Test Your Knowledge:

For each statement, consider if this is an operational activity or a project, and why?

 An electrician is called to a housing complex to assess and fix power issues in 100 units. Each day he fixes power issues in 20 locations. Each requires a different solution, some may need a new switch, new wiring or a new breaker.  (Project or Operations?)

While troubleshooting power issues, the electrician realizes that in many of the units the electrical panel is non-compliant. He informs the home owner that all units should be assessed to see how many panels need replacement.  After assessment, he could give them details of the work required with a quotation and timeline to replace the panels in all units impacted. (Project or Operations?)

Joe, a Business Analyst for ABC Company, writes adhoc reports for different users and different purposes as requested with delivery often committed for the same day of the request.  Is this report creation activity a Project or Operations?  (Project or Operations?)

Joe, in his role as a Business Analyst that supports the Finance team, is asked for a new report that turns out to be difficult to do and is beyond the scope of the BA team. Joe’s Manager gathers various experts to scope the requirements, look at the benefits, and then work out a time/cost estimate to complete.  (Project or Operations?)

Mammoth Construction builds housing projects.  The houses are in the same area with the same design and are very similar, but each will have unique challenges, different contractors, issues.  Is this operational or project based?   (Project or Operations?)

Or let’s try some examples you might do in your everyday life.

Jan has to cut the grass around her house to maintain her yard.  During summer months, Jan has to repeat this activity once every six or seven days.  (Project or Operations?)

John is installing a pool in his backyard.  He wants to start now and get it built before summer.  He is going to talk to several contractors about his vision in order to develop an initial design.  He will decide on whether to add a hot tub and surrounding garden as the pool design and costs are firmed up.  (Project or Operations?)

Summary

Both projects and operations are performed by people, constrained by limited resources (such as people, money, equipment, and time) and are planned, executed, and controlled.  However, projects are undertaken to attain an objective and then terminate.  They are created to organize activities that are not supported under the organization’s normal operations or are directly related to the achievement of the organization’s strategic plan.

Operations are on-going and intended to sustain the business.  Operations are those activities that don’t aim to produce anything new, but to maintain and sustain a system. In a business, for example, administrative tasks are operations. For an individual, eating, sleeping and paying monthly bills are also operations.

Projects are temporary endeavors that seek a unique result and then. Operations are repetitive and aim to keep everything running.

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