Performers, trackers, lemmings and the lost: Sustained false optimism in forecasting project outcomes — Evidence from a quasi-experiment

The consistently successful delivery of projects remains an ambition that many organisations do not achieve. Whilst the reasons behind project failure are many, one recognised factor is the ‘planning fallacy’ – over-optimism in the planning phase of a project. Whilst the planning phase of a project may be a battle for acceptance and resource allocation, the execution phase is a battle for delivery. Based on both qualitative and quantitative data gathered from a project management simulation, this study set out to establish whether optimism bias persists beyond the planning phase and into the execution phase, and, if so, to explore the reasons why. The results confirm the extent and impact of optimism bias in initial project planning. More importantly, the contribution of this study is to demonstrate on-going or sustained false optimism.     

Three domains of project organising

It has become axiomatic in research on project organising that projects are temporary organisations. Yet there are a number of challenges to this axiom: research on matrix organisation, the embeddedness of projects in project ecologies, and projectification all emphasise the relationship of the project to permanent organisations. Similarly, research on project-based firms and owner organisations which are relatively permanent challenges this axiom. This paper develops a conceptual framework which defines three domains of project organising: project-based firms; projects and programmes; and owners and operators as its principal theoretical contribution. This conceptual framework draws our attention to two important new areas for future research in project organising. The first is at the interfaces between the three domains of project organising: commercial, resourcing, and governance. The second is on project organising as temporary configurations of permanent organisations in coalitions to deliver particular outputs.     

From outpost to outback: project career paths in Australia

With the growth in project management as a form of work organisation in many sectors of the economy has come the significant rise in the number of project managers and project team members. This change in work organisation brings issues in forging career paths and determining career support in work situations that are often dynamic, short lived and intense. In the relatively small but substantially robust Australian economy, a unique labour market and the tyranny of distance bring their own difficulties. Innovative and collaborative project structures and increasing prevalence of contract work provide both challenges and opportunities for new career pathways in many industries. A growing percentage of Australia's workforce is employed in project-based or project-oriented organisations, leading to the claim that Australia is a project-based economy. This provided a context for our research into the career paths and the issues of career management for project managers working in a project based economy. Using in-depth interviews with project managers from three industry areas we found generational and gender differences in experiences of work, workplace support and mentoring for career development. For a continued strong performance in this economy, organisations that employ project personnel will need to consider how they will ensure the supply of high quality project professionals into the future.     

Great expectations and hard times: The paradoxical experience of the engineer as project manager

While tensions between technical and management functions in organisations have long been recognised, very little research examines this relationship empirically in light of the emergence of project management as an (apparently) attractive career route for engineers and other technical specialists. This paper empirically explores these tensions, identifying various contradictions between the discursive legitimation of project management and the lived experience of project managers. Drawing on a series of structured group discussions with project managers from a range of industrial sectors with an engineering background, the paper illustrates the tensions implicit in the transition from technical specialist to project manager, and provides empirical evidence of the conflict between discourses which extol the importance and value of project management as an organisational imperative and the far more mundane experiences of project management as practiced in the real world, posing fundamental questions about the status and influence of project management in contemporary organisations.     

Managing knowledge and knowledge competences in projects and project organisations

While project organisations have become common, knowledge management of project organisations are still largely underdeveloped. Nevertheless, project organisations require particular systematic and effective knowledge management if they are to avoid knowledge fragmentation and loss of organisational learning. This study deals with knowledge management and knowledge competences in project organisations, particularly framework programmes. In addition to a literature study, two programmes and a review project have been studied. Finally, a Learning Programme Model is presented.     

Construction industry productivity and the potential for collaborative practice

The construction industry is widely recognised as a laggard in terms of productivity improvement. This research study identifies the factors inhibiting collaboration and provides a model for developing a collaborative network approach. The case studies conducted examine the factors impacting on collaboration in the project networks of three large construction organisations. It was found that excessive fragmentation in the industry together with disparate project management processes and non-standardised information is impeding efficiency gains. A panel of project experts reviewed the findings to explain the basis of the practices. This has led to four primary conclusions: (1.) the construction industry lacks the ‘strength’ of relationships necessary to create a network of organisations that trust and have shared values; (2.) design processes should include both value engineering and lifecycle costing; (3.) procedures and information need to be standardised; (4.) there should be more emphasis on value adding project management activities.     

Complex project management as complex problem solving: A distributed knowledge management perspective

Traditional project management (PM) privileges planning and downplays the role of learning even in more complex projects. In contrast, this paper draws inspiration from two organisations that were found to have developed complex PM expertise as a form of complex problem solving (CPS), a practice with implicit learning because complex projects are unable to be completely specified in advance ( Hayek, 1945). Central to this view of complex project management as a form of complex problem solving is the governance challenge of knowledge management under uncertainty. This paper proposes that the distributed coordination mechanism which both organisations evolved for this contingency can best be characterised as a ‘common will of mutual interest’, a self-organising process that was fostered around project goals and paced by the project life cycle ( Kogut and Zander, 1992). The implications for theory, research, and practice in complex PM knowledge management are examined.     

Contemporary project portfolio management: Reflections on the development of an Australian Competency Standard for Project Portfolio Management

Project portfolio management is an emerging aspect of business management that focuses on how projects are selected, prioritised, integrated, managed and controlled in the multi-project context that exists in modern organisations. Competency standards have been developed by professional bodies for project managers. However, to date there has been no attempt to develop a competency standard at the portfolio management level. This paper examines the process for development of the first performance-based competency standard for project portfolio management and identifies how this contributes to the body of knowledge in both project portfolio management and project management more broadly. The intent is to use the Standard to improve project portfolio management capability and practice in organisations, which in turn promotes efficient resource use and more profitable project outcomes. Specific issues regarding Australian practice are described, along with implications for how this may impact Australian practice in the future.     

The project manager and the organisation's long-term competence goal

This paper presents empirical results from a study that aims to increase our understanding of the project manager's involvement in competence management in larger Swedish project-oriented organisations. Projects are today the predominant way of performing work. Organisations are also paying more attention to competence as competitive advantage. However, the logical interrelated connection between these two fields is still not understood.     

Project risk management methodology for small firms

We present a project management methodology designed for small businesses (SMEs), who need to run projects beyond their normal operations. These projects are critical to the survival of these organisations, such as the development of new products to adapt to the market or new legislation, management system implementations, etc. Very frequently, the managers of these projects are not project management professionals, so they need guidance to have autonomy, using minimal time and documentation resources. The risk management method outlined in this paper is based on extensive research with a large number (72) of Spanish companies. This new methodology considers the factors that are usually neglected by SMEs; i.e., project alignment with the company's strategy and results management. The methodology, based on project risk management, includes simple tools, templates and risk checklists with recommended actions and indicators. For validation it was tested in five different types of real projects (innovation, management systems and ICT implementation) of industrial and service companies with different characteristics.     

Profiling work motivation of project workers

The purpose of this study is to understand the constructs of work motivation in project-based organizations. We first juxtapose work motivation in traditional and project-based organizations to put forward an operational definition of work motivation for our study. We then present the research methodology where we profile work motivation as perceived by project workers using principal component analysis. We obtain a five factor structure of work motivation. Finally, we discuss these results by putting them within the project management perspective and suggest managerial implications.     

ConSERV, a project specific risk management concept

Managing risks in design intensive multi-disciplinary capital projects presents unique problems for decision makers within the project environment. Existing risk management tools, tend to employ axiomatic software and as such do not provide any intelligent risk management capability or lead to better informed decision making processes. ConSERV is being developed as a comprehensive project management methodology able to extract project specific risk issues throughout the project life cycle and apply experiential knowledge by using a knowledge-based system to assist in the management of them. A visual representation of the project risks is obtained by employing a more practical non probabilistic approach. ConSERV will provide project managers with on line decision support, at key stages of the project to assist in the management and control of the project specific risks identified.     

ISO 9000 certification and construction project performance: The Malaysian experience

Purpose

This paper explores the relationship between an ISO 9000 certified quality management system (QMS) and elements of performance in construction project environments.

Design/methodology/approach

A survey based approach is used to collect data from project managers working in the Malaysian construction sector in both ISO 9000 certified and non-certified organisations. Three elements of performance are explored: project management (PM) practices, financial management (FM) practices and Project Success. The Project Management Performance Assessment model (PMPA) (Bryde, 2003) is used as the framework for assessing PM Practices. 336 completed questionnaires are analysed, with a group of 73 being from ISO 9000 certified companies (a response rate of 48.3%) and a group of 262 being from non-certified companies (response rate = 32.6%). MANOVA are used to explore differences in levels of performance between the two groups.

Findings

Overall there is significance difference in mean scores at the 5% level in respect of each of the PM and FM Practice elements of performance, indicating that ISO 9000 certified companies have enhanced levels of performance in their project environments compared to those in non-certified companies. The two exceptions are the PM Practice related to establishing partnerships and managing resources and the FM Practice related to allowing for inflation and price escalations. The results also indicate that ISO 9000 certification has a positive moderating effect on the casual relationship between PM Practices and Project Success. Based on the survey results a Project Management Performance Assessment for Construction (PMPAC) model is developed, which extends the PMPA to include performance enablers linked to financial management activities.

Research limitations/implications

The survey focuses on the construction sector in Malaysia and further work is required to see if the findings are applicable to other countries and also to other business sectors beyond the construction sector.

Originality/value

The research reported in this paper is original in that prior research into the link of ISO 9000 certification and dimensions of organizational performance has not explicitly focused on project environments. The research findings provide evidence that those seeking to enhance their project performance could gain benefits from developing a QMS and seeking ISO 9000 accreditation. However the finding also indicate that an approach to performance management based solely on establishing a certified QMS may have its limitations in terms of establishing processes for managing the relationships on a project through partnership approaches and in dealing with uncertainty in the external environment, such as price fluctuations. The PMPAC model presented in this paper provides a framework for those working in construction project environments to ensure their project management systems incorporate the key activities that enable better performance.     

Impacts of multi-layer chain subcontracting on project management performance

This paper investigates the impacts of applying the multi-layer chain subcontracting system on project management performance with reference to Hong Kong construction industry. Multi-layer chain subcontracting system is widely used within construction industry as it is considered advantageous in many aspects such as better efficiency of subcontractors’ operation due to their unique skills. However, the fact of poor quality products in construction practice raises the doubt about the effectiveness of the chain system. Accordingly, the reasons why the applications of the system contribute to poor project performance are examined. A survey conducted in the Hong Kong construction industry demonstrates that the multi-layer chain subcontracting system, while widely adopted, is largely flawed. Based on the survey results, application of multi-layer chain subcontracting system contributes largely to the poor performance across the all major aspects including quality and time management, cost control, and communication and coordination performance. The association exists between poor project management performance and the increase of the number of layers in the chain of the subcontracting arrangement. The long communication chain because of the increasing layers of subcontractors results in various problems such as communication errors, poor supervision on the bottom-layer contractors. Consequently overruns in cost and time, and abortive and remedial works are common. Recommendations for improving the practice are suggested and explored, including change the practice of the “lowest bid” to an approach which incorporate both price and technical performance, limit the number of subcontracting layers, restrain the use of “supply-and-fix” subcontracting arrangement, and enforce the implementation of government regulations. The findings of this study provide useful references in examining the practice of subcontracting system in other construction industries and identifying the areas where the improvements can be made for gaining the benefits of using the system.     

Deliberate ignorance in project risk management

The management of project risk is considered a key discipline by most organisations involved in projects. Best practice project risk management processes are claimed to be self-evidently correct. However, project risk management involves a choice between which information is utilized and which is deemed to be irrelevant and hence excluded. Little research has been carried out to ascertain the manifestation of barriers to optimal project risk management such as ‘irrelevance’; the deliberate inattention of risk actors to risk. This paper presents the results of a qualitative study of IT project managers, investigating their reasons for deeming certain known risks to be irrelevant. The results both confirm and expand on Smithson’s [Smithson, M., 1989. Ignorance and Uncertainty. Springer-Verlag, New York] taxonomy of ignorance and uncertainty and in particular offer further context related insights into the phenomenon of ‘irrelevance’ in project risk management. We suggest that coping with ‘irrelevance’ requires defence mechanisms, the effective management of relevance as well as the setting of, and sticking to priorities.     

IT project management control and the Control Objectives for IT and related Technology (CobiT) framework

Motivated by scarce academic consideration of project management control frameworks, this article explores usage, value and structure of frameworks with a focus on the popular Control Objectives for IT and related Technology (CobiT) construct. We attempt to add to an empirically validated structure of internal control over IT project management by including CobiT's views on the intended domain of content. Results from the empirical survey indicate that the metrics suggested by CobiT are regarded as feasible and important by project management professionals, and are regularly used in controlling practice. Experience, regularity of significant projects and the size of the hosting organisations, however, seem to be stronger moderators of success rates than the use of a management control system with or without support of CobiT. CobiT's suggestions are of generic nature and in particular useful for programme performance management. The latent dimensions of project quality on process and activity levels were not validated and gaps to other project assessment models were identified.     

Understanding internally generated risks in projects

This paper identifies a class of risk that is common, important and yet poorly managed in projects. Internally generated risks arise within a project management team or its host organisation, from their management systems, culture and decisions. Even when a project applies recognised risk management processes, and seems to be managing its risks well, research demonstrates that internally generated risks are a different matter altogether. This calls into question how such risks can be managed, and whether current risk management practices need to be changed.     

Fundamental uncertainties in projects and the scope of project management

This paper builds on discussions that took place over a series of meetings in the UK of the Rethinking Project Management Network. The management of uncertainty is seen as a necessary condition for effective project management. Sources of uncertainty are wide ranging and have a fundamental effect on projects and project management. These sources are not confined to potential events, and include lack of information, ambiguity, characteristics of project parties, tradeoffs between trust and control mechanisms, and varying agendas in different stages of the project life cycle. Common project management practice does not address many fundamental sources of uncertainty, particularly in ‘soft’ projects where flexibility and tolerance of vagueness are necessary. More sophisticated efforts to recognise and manage important sources of uncertainty are needed. Such efforts need to encompass organisational capabilities, including some aspects of organisation culture and learning.     

Technological invention to product innovation: A project management approach

The optimal allocation of resources at the firm level to transform emergent technological invention into commercially successful products depends on the effective assessment and selection of projects. This study develops a multidisciplinary model for differentiating, prioritizing, and selecting investment in technological projects within an organization’s portfolio. Approaches from project portfolio and strategic technology management are integrated to explore how a particular product within a diverse project portfolio may be prioritized and developed. Our results suggest that the application of the suggested model to a portfolio of biotechnology projects may enhance the assessment of internal capabilities and external competitiveness, thereby providing a basis for firms to prioritize and preferentially allocate scarce resources within a portfolio of heterogeneous technologies.