Case: Housing Department in the Municipality of Berg.

Berg is a municipality and city in Norway with approximately 200,000 inhabitants. In this municipality, located in the region of Østlandet, the Housing Department is one of several municipal agencies. The Housing Department is headed by Hans Sletten, who serves as the agency’s director. In addition to staff functions such as finance and administration, the Housing Department comprises the following three divisions:

  • Urban Renewal Division
  • Property Division
  • Housing Division

In this case, we will focus on the Urban Renewal Division. The main task of this division is to manage the municipality’s role as a landowner, develop and enhance the municipality’s property portfolio, as well as purchase and sell properties, manage land leases and rentals.

In this case, we will focus on the Urban Renewal Department. The main task of this department is to manage the municipality’s landowner role, develop and improve the municipality’s property portfolio, as well as buy and sell properties, purchase and sell houses, and manage the leasing of plots. The department is led by department director Anne Henriksen, and she has four section leaders and a staff leader under her. The section leaders are responsible for their respective sections, which are:

  • Building Renewal Section (11 employees)
  • Green Courtyard/Public Space Section (6 employees)
  • Area Section (6 employees)
  • Staff Section (11 employees)

Most of the department’s employees have higher education from colleges or universities, with a majority being lawyers, architects, landscape architects, and economists. The relationship between the employees in the Urban Renewal Department can be characterized as good, as everyone knows each other, and new employees quickly integrate into the environment.

Up until now, the department has carried out tasks such as new construction or renovation of buildings within each section, with the section leader being responsible. If needed, employees from other sections have assisted in this work. This organization has worked reasonably well, but the department has experienced several instances where both budgeted costs and timelines have exceeded expectations. When discussing these issues in department meetings, Anne Henriksen has been told by her subordinates on several occasions that budget and schedule overruns are due to a lack of goal focus and collaboration.

In the last departmental meeting, one of the section leaders proposed that the department should consider organizing its tasks as projects. Both the department director, Anne Henriksen, and two other section leaders found this to be a good idea. However, the leader of the Area Section, Tor Svendsen, who has considerable experience in the department, was hesitant about adopting a new organizational structure. He argued that he had been through several organizational developments in his career without significant positive impact. Nevertheless, the department director decided to consider the idea of project organization as a possible solution to improve task execution.

Assuming that you are a new employee at the consulting company Project Development AS, last week, the department director, Anne Henriksen, contacted your firm. As an economist with specialization in project management, you play a key role in relation to the Urban Renewal Department. Next week, you will have your first meeting with the department’s leadership, consisting of Anne Henriksen and the section leaders. Since none of the participants from the Urban Renewal Department have prior experience with project work, it is crucial for you to convince the management team that project organization is the right path to take.

During your presentation, it quickly became evident that both the department director, Anne Henriksen, and the other participants from the department were interested in the idea. As a result, you all agreed to continue the collaboration with your firm to establish a project organization.

Three months later, the project organization in the Urban Renewal Department has started to take shape. The first project chosen is the rehabilitation of the Finstad Quarter (referred to as the Finstad Project). Department director Anne Henriksen relatively quickly decides to appoint Solveig Pedersen as the project manager for this project. She has been working in the department for three years, has no previous project experience, but is highly skilled in her field of “landscape architecture.” Solveig Pedersen had mentioned to the management team on several occasions recently that she was considering finding another job, which is why Anne Henriksen believed it was essential to give her this challenge so she would continue in the department. However, some other employees in the department thought that the selection of Solveig Pedersen had been too hasty. They believed there were several good project manager candidates who were suitable, and the department should have conducted a more thorough selection process. The other employees selected to participate in the project were three from the Building Renewal Section, two from the Green Courtyard/Public Space Section, and one from the Staff Section.

Initially, there was enthusiasm both within the project and the rest of the organization. However, as the work progressed, significant turbulence and dissatisfaction arose both internally within the project team and in relation to the line organization. Internal dissatisfaction in the project team resulted from various factors, including some employees feeling overloaded with work as they had to perform their original job tasks in the line organization as well. Some project team members also felt that the project was poorly organized, and they did not receive the responsibility for tasks as expected.

Not surprisingly, after a while, a strong professional disagreement arose between project manager Solveig Pedersen and Tore Olsen, the elder of the Green Courtyard/Public Space Section, regarding the technical solution and design of the courtyard in the Finstad Quarter. Both are known as talented landscape architects, and for the project, it is crucial to reach a solution that is well-liked by the residents. The disagreement has escalated to the point where the two are unable to collaborate constructively. To proceed with the project as planned, resolving the conflict is crucial.

Discuss the advantages that the Urban Renewal Department gains by organizing its tasks as projects.

Organizing tasks as projects can provide several advantages for the Urban Renewal Department. Here are some of the benefits:

  • Clear goal focus: Project organization helps establish clear project goals and define specific outcomes to be achieved. This makes it easier for the department to concentrate on its tasks and work towards concrete objectives. Clear goals can also enhance motivation and engagement among the employees.
  • Improved resource allocation: Project organization enables more efficient allocation of resources. By pooling resources from different sections within the department, better utilization of expertise and capacity can be achieved. This can optimize task distribution and ensure that the right individuals with the appropriate skills are involved in the projects.
  • Increased collaboration and interdisciplinary learning: When employees from various sections come together in a project team, it fosters collaboration and knowledge sharing across different disciplines. This can result in more holistic and innovative solutions, as diverse perspectives and competencies are brought together. Employees can also learn from each other and develop professionally through their work in projects.
  • Clearer accountability: Project organization entails establishing well-defined roles and responsibilities within each project. This makes it easier for employees to understand their tasks, whom they report to, and with whom they collaborate. Clear accountability promotes efficiency and reduces the risk of duplicated efforts or task oversights.
  • Enhanced management and control: Through project organization, the department can achieve better project management and control. It often involves establishing a project management structure that includes a project manager, project owners, and project management methods. This makes it easier to monitor project progress, resource utilization, and quality. With improved oversight and control, the department can quickly identify any deviations and take corrective actions.

These benefits depend on a well-implemented project organization and effective project management. Adequate training and support should also be provided to employees with no prior experience in project work to ensure a smooth transition to the new organizational form.

Discuss the challenges the department faces when transitioning to project organization.

When a department decides to transition to project organization, several challenges may arise. Here are some of the most common challenges the department in this case may encounter:

  • Lack of project experience: One of the main points in the case is that the department has limited or no prior experience with project work. This can be a significant challenge as project organization requires specific knowledge of project management and methods. Lack of experience may lead to uncertainty in project execution, poor understanding of project phases, and an inability to effectively manage project risks.
  • Resistance to change: The introduction of project organization may face resistance from employees accustomed to a different work structure. Some employees may be skeptical about organizational changes and fear that their roles and responsibilities will be altered. Resistance to change can hinder a smooth transition to project organization and affect collaboration and engagement among affected employees.
  • Transition issues: Transitioning from a traditional hierarchical structure to project organization can create transition issues. There may be uncertainty about how tasks and responsibilities are divided between the line organization and projects. Employees may experience the burden of working in both projects and their original line tasks. A well-planned transition strategy and clear communication are necessary to address such transition issues.
  • Lack of project management expertise: The case mentions that employees in the department have different professional backgrounds, such as lawyers, architects, and economists. It is not specifically mentioned if they have project management expertise. The lack of knowledge and competence in project management can be a challenge in establishing effective project management processes and ensuring projects follow best practices in project leadership.
  • Conflicts and collaboration issues: When employees from various sections and disciplines come together in projects, conflicts and collaboration issues may arise. These issues can be related to unclear roles and responsibilities, different perspectives and priorities, as well as communication challenges. Conflicts and collaboration problems can impact productivity, morale, and the quality of project outcomes.

To address these challenges, it is essential to have a comprehensive transition plan and implementation strategy. Providing training and skill development in project management for employees may be necessary. Establishing clear communication channels, defined roles and responsibilities, and fostering openness to change and continuous improvement within the organization are also crucial.

Discuss the type of projects the department has undertaken.

According to the case, the Urban Renewal Department has undertaken projects related to urban renewal, property development, and housing administration. Here are some examples of typical projects the department may have undertaken:

  • Rehabilitation of buildings: This may include projects that rehabilitate and modernize older buildings to upgrade housing standards, improve energy efficiency, adapt to universal design, or preserve cultural heritage values. Such projects may involve collaboration with contractors, architects, and other professionals.
  • Development of new housing: The department may have initiated projects involving planning, designing, and constructing new housing units. This could include acquiring land, developing zoning plans, collaborating with contractors and architects to realize housing projects, and subsequently managing the sale or rental of the housing units.
  • Purchase and sale of properties: The department may have projects where they purchase properties for development or management purposes. This may involve property valuation, negotiations with sellers, conducting due diligence processes, and managing the sales process when the property is to be sold further.
  • Management of land leasing and rentals: The department may have projects involving the administration of land leasing and rental agreements. This could include drafting contracts, handling payments, managing contract obligations, and resolving any disputes related to land use.

Each project will have its specific goals, scope, timelines, and resource requirements. The projects may vary in size and complexity depending on the needs and objectives of the department and the municipality.

Discuss how you would resolve the conflict between Tore Olsen and Solveig Pedersen.

To resolve the conflict between Tore Olsen and Solveig Pedersen, it is essential to take a constructive approach and use effective conflict resolution methods. Here are some steps that can help address the conflict:

  • Identify and acknowledge the conflict: The first step is to acknowledge that there is a conflict and recognize that it is affecting the project’s progress and collaboration between the involved parties. This can be achieved through open and honest conversations with Tore Olsen and Solveig Pedersen.
  • Create a safe and supportive atmosphere: It is crucial to establish an atmosphere where both parties feel safe and supported. This can be achieved by encouraging open communication, respectful listening, and showing understanding for both parties’ perspectives.
  • Identify the root causes: Through thorough dialogue and conversations with Tore and Solveig, identify the underlying causes of the conflict. It could be different aesthetic preferences, technical solutions, or conflicting priorities related to the project’s goals. By understanding the deeper causes behind the conflict, you can work towards a more effective resolution.
  • Foster open and constructive communication: Encourage Tore and Solveig to express their concerns and viewpoints in an open and constructive manner. It is important to create a platform where both parties can share their perspectives and listen to each other without interruption or criticism.
  • Find common goals and solutions: Identify common goals that both parties can agree on, such as achieving satisfaction for the residents in the Finstad Quarter. Then work together to find compromises and solutions that consider both parties’ viewpoints and expertise. This may involve using creative problem-solving techniques, brainstorming, or seeking external expertise if necessary.
  • Implementation and follow-up: Once a solution has been agreed upon, it is essential to implement it in practice. This may require clear guidelines, clear communication, and possibly changes to the project plan. Furthermore, there should be a follow-up mechanism to ensure that the agreed-upon solution is working and that the conflict does not resurface.

It is also important to involve department director Anne Henriksen in the process and inform her about the situation and potential solutions. She can provide leadership support and guidance to resolve the conflict in a constructive manner.

This case is taken from the book “Prosjektledelse – fra initiering til gevinstrealisering” – 2016, 4. Edition, by Jan Terje Karlsen.

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