in outcomes and benefits contexts
FEATURED PAPER
By Alan Stretton, PhD (Hon)
Sydney, Australia
INTRODUCTION
Stretton 2024e discussed “Managing Customer Projects vs. Internal Projects” in the context of some under-acknowledged differences between the two, and their relevance for discussing project management in project-based Supplier Organisations (SOs) vs. those in production-based Owner Organisations (OOs). These discussions were substantially based on ten attributes from a table in Lehmann 2016, which showed many differences between Customer Projects (in SOs) and Internal Projects (mainly in OOs) in respect of these attributes. These differences are summarised in an adaptation of Lehmann’s table in Appendix A.
Stretton 2024f further explored differences between managing projects in these two broad domains, this time in the context of a range of nineteen specific “classical” management functions, under the broad headings of planning, organising, leading, and controlling. Whilst there were some overlaps with Lehmann’s nine attributes, this exploration revealed many more differences in what the project managers have to actually do in managing their projects. These differences are summarised in Appendix B, which amalgamates the four comparison tables shown in Stretton 2024f.
That article went on to point out that these two sets of comparison still cover only some aspects of the differences between project management in OOs and SOs, and gave several examples of other operational aspects of project management which could be explored in the context of differences. I then acknowledged that further substantial investigation of such operational aspects is now beyond my limited resources and capabilities.
However, going beyond these initiation and operational differences for project management, we can also identify very substantial differences between SOs and OOs in the post-project-delivery stages – particularly as regards responsibilities for achieving outcomes and realising benefits. That is the primary focus of this article.
Finally, it is noted that the cumulative differences identified in this, and the two earlier articles, are very substantial indeed. But, how important are these differences? I believe they are much more important than is commonly recognised, particularly in the project management literature, and conclude by presenting a case for consolidating and formally acknowledging the differences in project management of Internal Projects in OOs versus that of external Customer Projects in SOs.
DESCRIPTORS OF SOs & OOs, AND OF CUSTOMER & INTERNAL PROJECTS
The following descriptors have been used in many of my previous articles
Project-based Supplier Organisations (SOs) derive most (if not all) of their revenue and/or other benefits from creating and delivering projects/programs to external customers.
Production-based Owner Organisations (OOs) derive most (if not all) of their revenue and/or benefits from producing and selling products and services. They utilize projects to create new, or improve existing, products and services; enter new markets; or otherwise improve or change their organisations.
I have also linked these two types of organisation with what Lehmann 2016 describes as Customer Projects and Internal Projects, which he elaborates on as follows.
Customer projects are mostly profit centers. The organizations involved perform these projects for paying customers, and it is the job of the project managers to bring money home.
An internal project, performed for an internal requestor, often called “internal customer”, is a cost center. There may be future expectations that the deliverables of the project will give the organization monetary benefits, but the project as such costs money and does not earn it. Projects can be performed for a variety of future goals, including new income, cost savings, strategic benefits. ….
From the above descriptors, it is clearly reasonable to suggest that SOs are primarily in the business of undertaking Customer Projects. These two will therefore be closely linked in following discussions.
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How to cite this work: Stretton, A. (2025). Exploring differences for project management in Supplier vs. Owner Organisations in outcomes and benefits contexts, PM World Journal, Vol. XIV, Issue IV, April. Available online at http://pmworldlibrary.net/wp-content/uploads/2025/03/pmwj151-Apr2025-Stretton-Extended-Supplier-Organization-and-Owner-Organization-differences.pdf
About the Author
Alan Stretton, PhD
Life Fellow, AIPM (Australia)
Sydney, Australia
Alan Stretton is one of the pioneers of modern project management. In 2006 he retired from a position as Adjunct Professor of Project Management in the Faculty of Design, Architecture and Building at the University of Technology, Sydney (UTS), Australia, which he joined in 1988 to develop and deliver a Master of Project Management program. Prior to joining UTS, Mr. Stretton worked in the building and construction industries in Australia, New Zealand and the USA for some 38 years, which included the project management of construction, R&D, introduction of information and control systems, internal management education programs and organizational change projects. Alan has degrees in Civil Engineering (BE, Tasmania) and Mathematics (MA, Oxford), and an honorary PhD in strategy, programme and project management (ESC, Lille, France). Alan was Chairman of the Standards (PMBOK) Committee of the Project Management Institute (PMI®) from late 1989 to early 1992. He held a similar position with the Australian Institute of Project Management (AIPM), and was elected a Life Fellow of AIPM in 1996. He was a member of the Core Working Group in the development of the Australian National Competency Standards for Project Management. He has published 270+ professional articles and papers. Alan can be contacted at alanailene@bigpond.com.au.
To see more works by Alan Stretton, visit his author showcase in the PM World Library at http://pmworldlibrary.net/authors/alan-stretton/.
