Project management and operational management – what is the difference? Students of management or business, as well as employees in the corporate world, hear frequently such expressions as project management and operational management, but a huge amount of people cannot distinguish between the two. Project and operational activity have several common features, which contribute to the realization of the strategy adopted by the given organization. Still, it is possible to show the crucial differences that indicate that those two terms describe two different things.
Project management and operational managment – table of contents:
- Project and operational activity
- Motivation and commitment
- Rules of rewarding
- Types of rewards
- Proceedings before the court of arbitration
Project management and operational management
The easiest definition of the project states, that it is a venture aimed at the achievement of the expected goal. In the situation, in which we know, what is the result (the solid effects) we wish to obtain within the scope of all activities, we should initially think about the main features that define the project, such as:
- limitation in time – activity within the predefined schedule, ability to indicate the beginning and the end of the project
- project team task realization – there is the leader that runs the project during the whole process of realization
- uniqueness – understood as the lack of repetitiveness, which includes the risk related to the performed activities
- specified budget – within the framework of the provided tasks
Operational activities in business are understood as the constant and repetitive performance of the same tasks. What is crucial, there are no limitations as to how the repetitiveness of those tasks should look like. Those can be everyday tasks, as well as monthly, yearly, or even those performed as required. Those tasks are not unique, which means that they present a low degree of risk.
In which way project and operational activity connect? The easiest way to explain this is to use an example: if we are working on a new product – a face cream – the stage of product development (that includes the goal setting, recipe of the composition, and testing) can be seen as a project. All the subsequent activities, such as production, distribution, or marketing of a new product are operational (repetitiveness, lack of uniqueness).
What is project management?
As was already mentioned, projects are focused on the result. This result can be either a unique product or service or another specific effect. This way projects support the long-term development of the company. Project management will encompass all tasks undertaken to achieve the requirements of the project. As a part of the realization, it is necessary to apply knowledge, skills, and understanding of the different types of techniques and tools.
The manager or leader of the team should possess the qualities necessary for his role. This person is responsible in the area of planning, initiating, performance (monitoring of the product or service development), and closure of the project. Moreover, the managing person has to approach individually every project, because effects, teams, and tasks are different from each other.
Operational management is related to the everyday activity of the company – this feature is treated as the highest factor that determines the uniqueness of the given area of functioning of the organization. It encompasses planning, organizing, and control of repetitive processes in the organization, which should positively influence the effectiveness.
The crucial feature of operational management is the pursuit of the stage, where the spendings and income are in balance – which means that operating profit is generated. The person, who controls operational activities is hugely responsible because the effects of production, marketing and finance activities influence the overall right functioning of the company in the short and long term.
What basic features distinguish a project from an operational activity? Projects are time-bound, unique, and subject to risk, and their realization should allow the company to reach its goal. We can include all activities connected with the everyday activity of the company, which are repetitive, subject to low risk, and result in the same effect as operational activities. It is worth remembering those 3 issues – this way we can be sure that specific types of management will not get mixed up. Good orientation in such differences can be crucial when creating a business strategy, business plans, or budgets – companies are not able to function properly without those documents.