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Corresponding author:
1 Admiral Makarov National University of Shipbuilding, Ukraine.
E-mail: nikolay.fateev@nuos.edu.ua
ORCID: https://orcid.org/0000-0002-2663-6440
2 Admiral Makarov National University of Shipbuilding, Ukraine.
E-mail: iryna.zaporozhets@nuos.edu.ua
ORCID: https://orcid.org/0000-0003-4015-5958
ResearcherID: U-4239-2017

DOI: https://doi.org/10.30525/2661-5150/2020-2-8

ORGANIZATION OF THE PROJECT MANAGEMENT OFFICE  
OF SHIP REPAIR ENTERPRISE

Nikolai Fateev1, Iryna Zaporozhets2

Abstract. The aim of the article is to study the features of ship repair production and, accordingly, develop 
recommendations for the composition of the functions of the project management office, its structure and stages 
of development. The characteristics of ship repair production, which determine its features and the structure 
of management of a ship repair enterprise, are systematically presented. The subject of the study is the models 
and methods of project management, programs and project portfolios of ship repair enterprises. The object of 
the study is the corporate project management system of a ship repair enterprise. The project-oriented nature 
of ship repair production, combined with a high degree of uncertainty in the planning and implementation of 
ship repair projects, identifies the need to use deterministic network models with a probabilistic estimate of the 
duration of work. To reduce risks in conditions of uncertainty, it is proposed to use Agile technologies, which 
organically complement the matrix organizational structure of a ship repair enterprise and ensure effective 
cooperation with the customer and the success of the business as a whole. The creation of a project management 
office is proposed to be implemented as a development system that includes four stages of maturity. The key 
functions of the project management office at each stage of development have been formulated. The role of 
the information model of the vessel in the implementation of the 6D design methodology, which provides 
monitoring during the operation of the vessel, predicting the degree of wear of the vessel's elements over 
time, is justified. The MS Project Standard package allows building interfaces with the information model of the 
vessel to obtain the parameters of the hull structures, characteristics of the mechanisms and equipment of the 
vessel, as well as recommendations for repair technology. An important function of the project management 
office is to participate in the strategic management of project portfolios. To implement this function in the 
enterprise management system, certain prerequisites for the development of portfolio management must 
be formed: a formalized strategy, metrics for evaluating projects for compliance with the strategy, a certain 
culture of management decisions. The duration of vessel repair determines the time of decommissioning. This 
important strategic indicator is the basis for the formulation of BS (balanced scorecard). An important task of 
the project management office is to implement feedback and provide information on the status of achieving 
the planned indicators at all levels of enterprise management. The structure of the function and tools of the 
project management office are determined by the management of the enterprise depending on the number 
and complexity of the ship repair projects, level of development of the corporate information system of the 
enterprise, availability of specialists with appropriate qualifications. The project management office will provide 
effective communication between project management and functional services of the enterprise, which will 
significantly improve the quality of the enterprise management system as a whole. The organization of the 
project management office in the management system of the ship repair enterprise will ensure the effective 
allocation of resources for projects, accounting for available resources of the enterprise, coordination of goals 
and tasks of individual projects with strategic plans of the enterprise. All this is aimed at reducing costs and 
increasing the competitiveness of the ship repair enterprise. 

Key words: project, project management, project management office, ship repair production, information systems.

JEL Classification: M11, M15, O22



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1. Introduction
Ship repair production is an important element 

of the system of operation of maritime and 
inland water transport. Increasing competition in 
global ship repair markets requires the constant 
improvement of technology and organization of 
production, development of modern management 
mechanisms. The main tasks that need to be 
addressed on the way to ensure the competitiveness 
of ship repair enterprises are reducing the duration 
of repairs, cost of work and improving the quality of 
repairs.

The theory and practice of project management 
have confidently become the basis of effective 
management mechanisms for ship repair 
enterprises. To enter the trajectory of sustainable 
development, ship repair enterprises use a strategy 
of diversification of production and economic 
activities, as well as resort to integration into the 
cluster economic systems of regional, national 
and international levels. At the same time, the 
network of production and corporate relations 
and dependencies is growing. In addition, there 
is a variability in the composition of cluster 
integrations and mobility of borders, which is 
necessary for effective functioning in a competitive 
environment. In these circumstances, the concept 
of project management in ship repair production 
must be supplemented with flexibility mechanisms 
that can be adapted to changes in internal and 
external factors, the structure of the project office 
must be brought in line with the industry specifics 
of project activities, which determines the relevance 
of the topic and content of the article.

The aim of this article is to study the features of 
ship repair production and, accordingly, develop 
recommendations for the composition, functions, 
structure of the project management office as 
a tool for strategic development in a competitive 
environment.

2. Statement of the main research material
A project management office is a balanced 

organizational and technological complex of 
software, technical and information tools and 
instruments aimed at implementing, supporting 
and improving the efficiency of project management 
processes. The functions of the project management 
office are performed within a unified information 
system and based on developed intracorporate 
standards (Bushuiev, Zakharov, Sharovara, 2009).

The PMBOK project management standard 
(American National Standard) recommends 
to define its functions in a wide range when 
organizing a project management office – from the 
functions of providing support in the management 
of individual projects to direct management of 
the enterprise project portfolio with integration 
into the mechanisms of strategic, tactical and 
operational management.

The PMBOK standard proposes a classification 
of the project management office into three types, 
depending on the degree of influence on the project 
activities of the enterprise:

1. Supportive – plays an advisory role, serves as 
a repository for projects, the degree of control from 
the project management office is low.

2. Supervising – provides support to the team of 
project managers, provides adaptation of models 
and methodologies of project management, 
analyzes successful practices.

3. Managing – supervises projects by directly 
management of the enterprise portfolio.The degree 
of control from the project management office is 
high.

Any type of project management office provides 
effective communication between projects and 
enterprise performance appraisal systems.

The nomenclature of functions of the project 
office of a ship repair enterprise and, accordingly, 
the architecture of software tools, it is advisable 
to form on the basis of an analysis of the features 
of ship repair production and strategic goals of 
the enterprise. The characteristics of ship repair 
production, which determine its features, can be 
presented in the following form:
– A high degree of uncertainty in the planning 
and implementation of ship repair projects  
(a significant part of the work is revealed after the 
dismantling of mechanisms and defects at later 
stages). It follows that the problem of relations with 
the customer, who needs a clear determination of 
the terms of repair in the contract, as well as the 
cost of all resources. Therefore, a specific form of 
cooperation with the customer has developed in 
ship repair, which provides for the readiness of all 
participants to change projects, their unification 
around common values.
– Single and small-scale production.
– Project-oriented nature of production. As a 
result, ship repair production has a pronounced 
matrix structure. At the same time, a strong matrix is 
inherent in ship repair, where project management 



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factors prevail, project managers have broad 
powers.
– The irregularity of resource costs during the 
repair process, which in the context of multi-project 
management and a complex project portfolio 
structure requires the development of unique 
models for the supply of materials and components.
– A significant proportion of manual operations, 
which, moreover, are performed in unfavorable 
conditions (seasonality, weather conditions), 
requires highly qualified personnel.
– Specific methods, tools and organization of 
production preparation, which significantly affects 
the duration and quality of repair projects. The 
ship's crew, representatives of the customer and 
the project executor take part in the preparation to 
repair the vessel. At this stage, flaw detection lists 
for all subsystems of the vessel (hull, mechanical, 
electrical, radio navigation, etc.) are compiled. 
Flaw detection lists include information on the 
nature of defects and comprehensive data on the 
range and scope of repair work, which are the basis 
for the development of a network model of a repair 
project.
– In work (Fateev, Zaporozhets, 2009), the authors 
set out the specifics of constructing the financial 
structure and budget system of a ship repair 
enterprise. Specific models for aggregating project 
budgets at the level of individual programs and the 
enterprise portfolio as a whole are proposed.
– In the process of preparation of ship repair 
production, a transport vessel as a technical system 
can be represented consisting of elements that 
have common design characteristics and repair 
technology. As a result of such a decomposition, a 
hierarchical structure is formed, where the lower 
level is made up of structural and technological 
elements (STE), for which standard technological 
repair processes are used. The results of work for 
each STE are completed with submission to the 
customer and, if necessary, to the classification 
society. The effectiveness of the ship repair process 
as a whole depends on the validity and quality of 
decomposition.
– When developing private network models for 
performing work for each STE in ship repair, it is 
necessary to use deterministic network models 
with a probabilistic estimate of the duration of 
work (Razu, 2007). In the process of linking private 
network models to the calendar and building an 
integrated network schedule for ship repair, a table 
of interdependence of work on different STE is 

used. After bringing the parameters of the network 
schedule to the specified constraints (optimization 
of the network schedule), a responsibility matrix 
is drawn up, which coordinates the structure of 
the breakdown of work on the project with the 
organizational structure of project management.
– The elements of the Agile methodology are 
increasingly used in ship repair (Kom Mayk. 
Agile, 2018; Appelo Yurgen, 2018). Through 
the formation of cross-functional teams, which 
include specialists from different divisions of the 
ship repair enterprise, as well as from suppliers, 
customers, consultants, etc., an efficient solution to 
conflict situations is provided for the distribution 
of resources between works on different STE.
Agile technologies organically complement the 
matrix organizational structure of the ship repair 
enterprise, which provides effective cooperation 
with the customer, business success in a dynamic 
environment.
– Modern technologies for the design, construction, 
repair and operation of vessels are based on a single 
information space (6D design). Thus, models for 
planning and implementing the ship repair projects 
should be integrated with ship design systems.

It is advisable to implement the creation of 
a project management office as a developing project 
(Razu, 2007). Logically and temporally, the 
developing project consists of separate initiatives 
for further improvement and development of 
previously obtained results. The development of 
the organizational structure of the project office is 
individual for each individual enterprise. The set of 
tasks solved in the office directly correlates with the 
maturity of general management at the enterprise 
and project management, in particular.

We will present the structure and functions of the 
project office of a ship repair enterprise in the form 
of a developing system that includes several stages 
of maturity. The evolution of the project office is 
associated, first of all, with “increasing capacity”, 
that is, the expansion of the set of functions 
performed by it. The proposed maturity levels are 
based on the model of classification of corporate 
project management systems recommended by the 
PMBOK standard (American National Standard) 
and taking into account the specifics of ship repair 
production.

Stage 1 – the processes of forming the project 
office as a structural unit of the enterprise: the 
development of regulations governing the activities 
of the project office, analysis of information on the 



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structure of the project portfolio, formalization of 
project management processes.

An important element of the first stage is the 
formation of an information system for scheduling 
projects. In our opinion, the confident leader in 
the market of information systems for project 
management is the software product of Microsoft 
MS Project Standard (Microsoft Project, 2020). All 
the main tasks of planning and implementation of 
ship repair projects are implemented here.

The MS Project Standard package implements 
data export, i.e. import tools that provide integration 
with the enterprise accounting system. On the basis 
of this package, an automated workstation (AWS) 
is being formed for the project manager of a ship 
repair enterprise.

At the first stage, it is necessary to form and 
subsequently increase a knowledge base and skills 
in project management, to organize a continuous 
process of employee training.

Stage 2 involves expanding the influence of the 
project office by increasing the range of tasks. In 
addition to supporting the project management 
methodology in an active state, the project 
management office, through close interaction 
with project managers, ensures timely updating 
of project schedules in the information system, 
processes reports on the status of work on projects, 
which allows it to form an overall picture of projects, 
maintain a documented archive. 

The financial structure of the ship repair 
enterprise is a system of responsibility centers. 
The budget system corresponds to the financial 
structure. The consolidated budget provides for 
the determination of indicators of the operating, 
investment and financial activities of the enterprise 
as a whole.The project management office provides 
analytical information on the costs of projects, 
programs and portfolios of the enterprise to the 
finance department and accounting.

The key function of the project management 
office at the second stage is to control the 
allocation of resources to projects. For this, the 
project management office forms a corporate 
pool of necessary materials, components and 
provides operational information to the material 
and technical supply service, which will allow to 
organize a reliable logistics service for the ship 
repair enterprise.

At stage 3, a predictive analytics function is 
recommended to the project management office, 
within the framework of which project statistics 

are maintained, analytical reports and normative 
estimates for project planning are generated.This 
also includes a register of typical risks associated 
with a high degree of uncertainty in ship repair 
production.

An important task of the third stage of 
project management office development is the 
development of regulations for information support 
of the Agile methodology. A cooperation of the 
project management office with cross-functional 
teams will allow to promptly adjust project plans, 
reallocate resources within the project portfolio.

The use of the information model of the vessel, 
which is formed at the stages of design and 
technological preparation of production within 
the methodology of 6D-design, will reduce the 
complexity of the development of ship repair 
projects and improve their quality.

In essence, 6D-design allows planning for the 
next stages of life cycle of the vessel, it is a system 
of monitoring during operation of the vessel, 
predicting the degree of wear of ship elements over 
time. The project management office will provide 
preparation of documentation for scheduled 
inspections and tests of key units, repair and 
replacement of equipment, pipelines, mechanisms.

The MS Project Standard package allows to build 
effective interfaces for obtaining parameters of 
hull structures, characteristics of mechanisms and 
equipment of the vessel, as well as recommendations 
on repair technology, laid down in the information 
model of the vessel.

The stage 4 involves the active participation of 
the project management office in the strategic 
management of the project portfolio. To do this in the 
enterprise management system, certain prerequisites 
for the development of portfolio management 
must be formed: a formalized strategy, metrics for 
evaluating projects for compliance with the strategy, 
a certain culture of management decisions.

It is recommended to use the BS to assess the 
effectiveness of ship repair enterprise projects and 
their compliance with the corporate strategy. The 
BS evaluates the work of an enterprise on the basis 
of four balanced parameters: finance, customer 
relations, internal business processes, as well as 
training and advanced training of personnel. The 
duration of the vessel repair determines the terms 
of decommissioning. This important strategic 
indicator is the basis for formulating BS for all four 
groups. The task of the project management office 
is to implement feedback and provide information 



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on the status of achieving the planned indicators at 
all levels of enterprise management.

The project management office, the level 
of development of which corresponds to the 
fourth stage, is not in demand at all ship repair 
enterprises. The structure, functions and tools of 
the project management office are determined by 
the management of the enterprise, depending on 
the number and complexity of ship repair projects, 
level of development of the corporate information 
system of the enterprise, and availability of trained 
specialists.

3. Conclusions
1. The features of ship repair production 

determine the structure, functions, composition 
of tools and stages of development of the project 
management office.

2. The organization of the project management 
office in the management system of the ship repair 

enterprise will ensure the effective allocation of 
resources for projects, accounting for available 
resources of the enterprise, coordination of goals 
and tasks of individual projects with strategic plans 
of the enterprise. All this is aimed at reducing costs 
and increasing the competitiveness of the ship 
repair enterprise.

3. The project management office will ensure 
effective communication of project management 
and functional services of the enterprise 
(marketing, material and technical supply, financial 
management, personnel management), which will 
improve the quality of the enterprise management 
system as a whole.

4. It is necessary to increase the knowledge base 
and skills in the management of ship repair projects, 
organize a continuous process of employee training.

5. For the sustainable development of project 
management methodology in shipbuilding and 
ship repair, it will be necessary to develop industry 
standards for project management. 

References:
American National Standard. A Guide to the Project Management Body of Knowledge (PMBOK Guide). 
Sixth Edition. USA, ANSI/PMI, 2017. 976 p.
Fateev, N. V., & Zaporozhets, I. M. (2009). Byudzhetirovanie v sisteme uprableniya proektami i 
programami sudoremontnogo predpriyatiya [Budgeting in the project management system and programs 
of the ship repair enterprise]. Upravlinnia proektamy ta rozvytok vyrobnytstva, no. 2(30), pp. 118–123.
Razu, M. L. (2007). Upravlenie proektom. Osnovy proeknogo upravleniya [Project management. 
Fundamentals of project management]. Moscow: KNORUS, 767 p. 
Kom Mayk. Agile. (2018). Otsenka i planirovanie proektov [Project evaluation and planning]. Moscow: 
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