DEVELOPING PROJECT COMPETENCE - IEI

October 26, 2005 14:45 WSPC/150-IJIM

00134

International Journal of Innovation Management Vol. 9, No. 4 (Dec. 2005) pp. 451–480 © Imperial College Press

DEVELOPING PROJECT COMPETENCE: EMPIRICAL REGULARITIES IN COMPETITIVE PROJECT OPERATIONS

JONAS SÖDERLUND School of Management, Linköping University 58183 Linköping, Sweden [email protected]

Received 20 August 2004 Revised 15 January 2005 Accepted 18 January 2005 Projects play key roles in many modern industries and firms. The management of these economic systems, project management, is continuously developed and considered to be at the core of competitive advantage. Traditional research on project management has, however, paid scant attention to the capabilities needed for firms that depend on projects in their business operations. Furthermore, traditional work on the capabilities and competence of the firm pays limited attention to the specific traits of project processes. In the present paper, project competence is considered to be one of three strategic competencies frequently observed in modern firms. We develop an overall model for the analysis of project competence. The proposed model identifies four building blocks of project competence, namely project generation, project organising, project leadership and teamwork. In an empirical study we elaborate on some empirical regularities in the operations of firms that to a large extent depend on projects. The companies studied are ABB, Ericsson, Skanska and Posten. We illustrate the possibilities of this model and show some variations between the companies. The article illustrates how the project competence framework might explain the differences among the competitiveness of firms. Keywords: Project management; project organisation; project-based firms; project capabilities; project competence; competitiveness.

The “Projectification” of Firms and Industries A number of recent studies have documented the widespread use of project-based forms of organising. For instance, the study by Whittington et al. (1999) published in Organisation Science clearly documented this inclination. Research has pointed to two important reasons why these forms of organising have become the core of 451


452

00134

J. Söderlund

many modern firms and industries: 1. The growth industries largely organise activities in projects (March, 1996; Mintzberg, 1979; see also Gaddis, 1959). This is true for both development and production activities. For instance, IT, management consulting, technology consulting, knowledge- and technology-based companies organise their daily operations in projects (Ekstedt et al., 1999). Other growth industries where projects play a key role include entertainment, culture, media and advertising (e.g., DeFillippi and Arthur, 1998; Windeler and Sydow, 2000; Ekynsmith, 2002; Grabher, 2001, 2004). 2. Mature industries organise their activities to an ever greater extent in projects. This “projectification” is, for example, observed in the automotive industry (Clark and Fujimoto, 1991; Midler, 1995), in the telecommunication industry (Lindkvist et al., 1998) and in the electric equipment industry (Berggren et al., 2001). The fundamental explanation here is the shortening of product life cycles and a general increase in R&D spending paired with an increase in the number of complex systems and products (Hobday, 1998). It is, as put by Hobday (2000, p. 876), certainly reasonable to assume that as market changes, risk and uncertainty increase, the “project form” will grow in importance in a wide range of industries and firms. The issue of project-based organising has also attracted the attention of scholars of organisational capabilities who pursue the idea that project-based companies represent a special category of organisations, a category that requires researchers to take a closer look at the requirements for successful project organising. In this paper, we will continue along this avenue of research but complement existing knowledge with some development patterns observed in companies that explicitly seek to develop and extend their project competence.

Capabilities and Competence in “Projectified” Firms Traditional work on core competencies (Prahalad and Hamel, 1990), organisational capabilities (Chandler, 1992) and dynamic capabilities (Teece and Pisano, 1994) has given us a platform to improve the analysis of what firms do and what differentiates low- from high-performing firms. The capabilities normally emphasised include organisation, management, coordination and governance (Kogut and Zander, 1992). Accordingly, the sets of activities that a firm can organise and coordinate better than other firms are its distinctive competencies. In a project context, one would assume that the organisation, management, coordination and governance of projects would constitute such distinctive capabilities. However, traditional work on capabilities has given modest interest to the salient features and organisational consequences of project-based operations.


00134

Developing Project Competence

453

One key concept in the economic analysis of organisational capabilities is organisational routines. The concept illustrates the set of skills inside a firm necessary for carrying out its vital operations. However, the concept is not easily positioned in a project-based context. For instance, in their original work Nelson and Winter (1982, p. 97) pointed out that firms involved in the production or management of economic change as their “principal function”, e.g., R&D laboratories, consulting firms and other companies that we often label project-based, “do not fit neatly into the routine operation mold”. Moreover, Davies and Brady (2000) point to the importance of “economies of repetition” in building project capabilities. In our view, the replication of solutions represents one aspect of the building of project competence. In the framework suggested in the present paper, we will instead turn to the meta-level organisational activities that constitute project competence. We draw on different lines of research in elaborating on an analytical framework for the study of project competence. We argue that the analysis of project competence not only should address a certain category of firm, such as a particular type of CoPS (Complex Product Systems) firm (cf. Hobday, 1998), but also stress the requirements of sustained firm performance to be based on a firm’s capacity and capability to carry out different types of project. Even though there is a great difference between development and implementation projects, several firms, such as the ones in our empirical studies, need to handle different types of projects. There are a number of recent studies on the expansion of project-based organising in mature industries. In several ways recent contributions further the ideas of Clark and Fujimoto (1991) about the various rationales for project organising. The Clark and Fujimoto study also demonstrates the importance of “heavy-weight” project management structures in the automotive industry. Generally, the recent contributions stress the importance of project management for a large category of firms. Scanning through descriptions of some major companies reveals a large portion of them being project dependent (cf. Miller and Lessard, 2000). For instance, as will be illustrated in later sections, our case study companies are only examples of some of these project-dependent companies. There are a number of other companies and industries where project management and, more broadly speaking, “project competence” is at the heart of competitiveness. Earlier research has illuminated such firms in the transportation industry (Siemens, Germany; see also the work of Geyer and Davies, 2000), the packaging industry (Tetra Pak, Sweden; see also the work of Lindkvist, 2004), the construction industry (Arup, U.K.; see Gann and Salter, 2000), the earlier mentioned automotive industry (see Midler, 1995; Womack et al., 1990), the telecommunications industry (Ericsson, Nokia; see Davies and Brady, 2000) and the power transmission industry (ABB; see Berggren et al., 2001; Engwall, 2003). Hobday (1998, 2000) developed the notion that firms that develop and produce complex product systems generally are dependent on their capability of


454

00134

J. Söderlund

managing and organising projects. In sum, a number of firms consider project management (in a wide sense) to be at the core of their competitiveness. We find such firms in both capital goods industries and R&D intensive industries, and in both mature and growth industries. However, several observations in the afore-mentioned studies are problematic for the development of knowledge about contemporary firms. As mentioned, R&D, consulting firms, etc., do not fit neatly into the framework and analysis of organisational routines (Nelson and Winter, 1982). Chandler (1990), in a similar manner, focused on firms that only to a limited degree carried out projects. These seminal contributions to the capabilities and competence literature thus have some shortcomings in providing a framework for understanding the operations of project-based firms. The present article aims at providing a tentative framework for the analysis of project competence. It is suggested that such a framework should facilitate an understanding of the key processes, evolution and some development problems of project-based firms. We are, however, not the first ones attempting at providing insights into the organisational logic and competence of project-based firms. But we have some concerns about present writings related to project competence. The organisation theory literature generally illustrates the importance of balancing the market and technology forces in project-based operations. Authors stress the core processes of project-based organisations as business (or market), project and technology. The original work of Galbraith (1977) and Allen (1977) emphasised these strategic flows to be integrated in the project operations of the firm. These contributions took only a limited interest in the competence required for successful project generation and project execution and stopped at comparing the various alternatives for firms struggling with continuous technology and market changes. More recent contributions have concentrated on the competencies and capabilities necessary for successful projects. The classic project management literature and the search for success factors in project operations is one stream of literature. A number of studies have documented the need for clear goals, powerful project managers, efficient team communication, etc. (see Morris, 1994; Söderlund, 2004, for reviews of the literature). This stream of literature is primarily based on relatively broad surveys and a focus on specific projects. We argue that an understanding of how firms develop project competence must rest upon an analysis of both specific projects and the development and change of the focal firm. We believe that such an understanding must be based on in-depth studies of firms over time, not on broad surveys and comparisons of projects in different sectors and industries. In the technology management literature a few recent studies have focused on project competence or similar accounts. Davies and Brady (2000) focus on major shifts in the operations of a project-based firm and the attainment of so-called


00134


455

“economies of repetition”. Gann and Salter (2000) provide a model for the analysis of the relationship between business and project processes. The present paper builds upon these insights in trying to understand the development of project competence. We also offer a more detailed analysis of the building blocks of project competence observed in our case-study firms. The literature on learning in project-based firms falls close to the topic of developing project competence. One example is the work of Prencipe and Tell (2001) that elaborates on a framework for the analysis of “inter-project learning”. Our main concern is that the development of inter-project learning must rest upon an initial understanding of the key activities, or building blocks, of project competence. We presume it to be difficult to further our understanding of project competence without first clarifying what one means with project competence, and how project competence fits into the larger framework of the strategic or organisational capabilities of the firm. Furthermore, we must also provide some understanding of what constitutes project competence in a project-based firm. These are the issues that we attempt to clarify in this paper.

The Foundations of a Framework of Project Competence The framework presented in this paper draws on various streams of literature. Much of our inspiration is emerging from recent articles in International Journal of Innovation Management (e.g., Davies, 1997) and Research Policy (e.g., Shenhar and Dvir, 1996; Davies and Brady, 2000) but there are a number of areas that need to be complemented and further elaborated on. The definition of project competence put forward in this paper emphasises the importance of the early phases of projects. Our general idea of project competence is the firm’s ability to generate/select and implement/execute projects skillfully. Successful projects are thus a function of what projects to pursue (generation of ideas, formation and selection of projects) and how to pursue them (management and organisation of project implementation/execution). In our view, project generation is a key activity in several project-based firms and the development of tools and instruments to improve this activity have been launched in recent years (see, e.g., Bayart et al., 2000). The project generation is also about winning projects and forming projects skillfully. Thus, we suggest a broad and processual view of project generation. The importance of the early phases of projects has also been observed in a number of studies of the decision-making process (Genus, 1997), marketing of projects (Cova and Holstius, 1993) and product design (Hobday, 1998). The importance of the early phases is also highlighted by Davies and Brady (2000) and Gann and Salter (2000) in their studies of construction projects and complex product systems. The authors point to knowledge of bidding,


456

00134

J. Söderlund

the marketing knowledge and the network knowledge in order to win a contract. From the perspective of the firm, the early phases of projects could be looked upon as a decision-making process, or as a strategic investment process that determines the playground of the company for a long time. For instance, the work by Bowen et al. (1994) stressed development projects as the “engine for renewal” in contemporary companies. In such contexts, the issue is not about bidding, but instead on idea generation, decision-making and feasibility judgements. Similar observations are found in Bower (1970). In sum, we believe that the following elements should be required from a framework of project competence: 1. It has to take into account a number of different project types that all play significant roles in the development of companies. The exchange of knowledge between project types would be of importance for the understanding of the development of project competence. 2. It has to take a broad approach to the project activities of the firm, including both strategic and operative factors as well as early and implementation phases. Successful projects rest upon both good ideas and the ability to execute them. 3. It has to acknowledge the fact that companies move through different stages, both minor and major, in the development of their project competence. The organisation and management of the firm’s project operations are critical for sustaining competitive project operations, sustaining such a position requires a constant adjustment but also at times major changes. 4. It has to identify the key activities and building blocks within the firm’s project operations that constitute its project competence. 5. It has to rest on an understanding of shifts between project logics (for instance as the case of Davies and Brady illustrates a shift towards turnkey projects). The tentative framework elaborated upon in this paper thus rests upon these five core elements. We are, no doubt, aware of the problems in establishing such a framework and we also acknowledge the many contributions that could be utilised in creating such a framework. Literature from a wide range of disciplines might be of relevance. We do not argue that the present framework is the final word in the discussion of project competence, but instead a better platform to further our understanding of core competences in firms dominated by or dependent on projects and how such firms develop project competence.

Strategic Competences: Bringing Projects in In our framework, we will suggest that project competence must be put at the fore of an analysis of the evolution and change of the modern firm. In this paper, we, for


00134


457

Fig. 1. The strategic competences of the firm.

obvious reasons, especially consider the capabilities necessary for understanding successful project generation and project execution, but we are truly aware that organisational capabilities/competences cover broader aspects of the firm than its project operations. In putting project competence in a wider conceptual framework, we suggest that the firms under study primarily are occupied with three different strategic organisational competences: (1) business competence, (2) project competence and (3) technological competence (Fig. 1). We suggest that the relationship between the competences is paramount for the understanding of both project-led and traditional project-based firms (Hobday, 2000). For instance, Gann and Salter (2000, p. 970) emphasise that the relationship between business and project processes are significant for project-based firms’ ability to sustain competitive advantage over time. Winch (2000) furthered the idea that the project process should be considered a “generic business process” in an analysis of the modern firm. In the present paper, we define project-based firms relatively broadly as any firm that rests upon projects in developing and sustaining its competitiveness. In other words, we include both project-led and traditional project-based firms (Hobday, 2000) in our analysis. Much cited work into the area of core competences has had a propensity of emphasising the technological competence of the firm. Indisputably, the technological competence of the firm is important (Patel and Pavitt; 1997; Iansiti, 1998). However, previous research has given scarce attention to the role of project competence in explaining the distinctive capabilities of firms and in illuminating some key activities in the operations of many project- and knowledge-dominated firms. In a number of recent contributions to the knowledge-based perspective of the firm, projects have been considered to play a key role. Hedlund (1994) pointed to temporary constellations of people to combine the knowledge bases of the firm and to utilise its knowledge potential. Ekstedt et al. (1999) offered a framework for the study of project-intensive organisations consisting of knowledge and action formation. Furthermore, Davies and Brady (2000) suggested that project capabilities should complement and extend the Chandlerian framework of organisational


458

00134

J. Söderlund

capabilities. In addition, the contribution of Gann and Salter (2000) emphasised project organising for the understanding of the innovative capability of construction and engineering firms. The frameworks provided, however, have a few shortcomings when it comes to the understanding of projects. We especially argue that the following three shortcomings are the most profound. First, project competence is key not only for CoPS firms and traditional projectbased companies, but also for other firms that carry out projects to complement their regular lines of activity. A focus on CoPS might lead us to produce research that is limited only to a small category of firms when the matter of project competence is critical for a number of project-oriented firms: project-led, project-dependent and project-based firms. We also argue that many firms run different types of projects and thus a framework of project competence must have the capacity to explain how firms handle a variety of projects. This is the first point of our paper. Second, in our conception, regarding project competence we argue that project competence must be understood in a more holistic manner, including aspects of project generation (early project phases) and various aspects of project organising, project leadership and project teamwork. This is the second point of our paper. Third, project competence, in our conception, is an organisational, integrative capability consisting of a set of sub-processes and meta-level project activities, as indicated above. Concomitantly, we argue that different types of activity and, most importantly, their interrelationship must be included in an analysis of project competence. For instance, project generation has effects on the organisation and teamwork of projects and vice versa. This is the third point of our paper.

Project Competence: A Point of Departure Several researchers have attempted to focus and extend our understanding of capabilities and competence of the firm. In doing so, researchers have pointed to management, organisation and coordination to be solutions in the building of organisational capabilities (Grant, 1996). Routines have been considered to be another salient concept, although as criticised by Williamson (1999), the concept is yet to be defined and illustrated in practice. In their study of architectural innovation, Henderson and Clark (1990) emphasised the role of holistic approaches to understand and analyse innovative activities. In their research, a technological breakthrough was explained by a new combination of existing components. These core organisational capabilities are based on a “hierarchy of practiced organizational routines, which defines lower order organizational skills (skills required at the lower levels of the hierarchy), and how these are coordinated, and higher order decision procedures for choosing what is to be done at lower levels. The notion of a hierarchy of organisational routines is the key building block under our concept of core organisational capabilities.” (Nelson, 1991, p. 67.)


00134


459

Despite the insights of the literature on capabilities and routines we submit that they do not fully explain the situation of firms largely resting upon projects in their everyday operations. In the Chandlerian work, for instance, much attention has been paid to the development of production facilities and distribution networks. Very little attention is paid to the selection and implementation activities of projects. Further, the routine concept has shortcomings in explaining the operations of R&D companies and consulting firms, i.e., companies that resemble the typical projectand knowledge-oriented firm we focus upon in the present paper. In much early work, projects have been considered to be non-routine activities and thus difficult to explain or study (cf. Hobday, 2000). However, in modern firms as explained earlier, these non-routine activities become the core of the operative activities of the firm. As emphasized by Hedlund (1994): The prominence of small groups, often temporary, in innovation and product development indicates that this is the level which much of knowledge transfer and learning take place (Hedlund, 1994, p. 75). In Hedlund’s view most new products are combinations of slightly modified components. The key to success would thus be to swiftly exploit opportunities to recombine these components — a process that would require a flexible management and organisation system. Hedlund argues that organisation scholars to a greater extent must focus on these combinations and more clearly pinpoint how projects and other temporary constellations of people function, how the horizontal communication is shaped and how top management facilitates contexts where these processes can unfold. The temporary project — multifunctional, multinational, multidivisional — becomes the natural mechanism, and the quality of project management and project/organisation interface critical for success (Hedlund, 1994, pp. 83–84). Hedlund thus criticises the traditional view of the large, complex firm as divisionalized and top-managed as frequently represented by the M-form organisation. Accordingly, the M-form image of the firm produces a bad description of many, if not most, modern firms. The author instead stresses that management has to be understood from its role in guiding visions and collections and recollections of projects and project teams. In several aspects, the work of Hedlund offers a theory of the firm as knowledge- and project-dominated. He, however, does not offer a further analysis of the capabilities of a firm resembling this image of knowledgeand project-dependency. For instance, it is not clear what capabilities are important


460

00134

J. Söderlund

in a project-dominated firm, the relationship between these capabilities and how project competence evolves. Davies and Brady (2000) suggested that the Chandlerian framework of organisational capabilities could be modified to explain how suppliers of complex product systems build the capabilities necessary to expand successfully into new lines of business. In addition to Chandler’s concepts of functional and strategic capabilities, the authors suggested “project capabilities” to refer to important activities of bid preparation and project execution. The authors also presented an organisational learning cycle model in order to show how the so-called CoPS firms move from the first bid or project of its kind in a new domain of business, to achieve “economies of repetition”. For sure, economies of repetition are a key concern for every company and have also been an issue for debate regarding the paradox of project-based enterprises (cf. DeFillippi and Arthur, 1998). However, we would argue that strict and systematic economies of repetition are one important aspect of the development of project competence, although this view has to be complemented with other meta-level activities to be able to explain successful project operations.

Research Methodology The research method used in the present research is one of multiple case studies and a search for “empirical regularities”. The paper is thus strongly empirical and inductive. We argue that such an approach is especially worthwhile when we need to develop frameworks and integrate different fields of inquiry (Eisenhardt, 1989). A number of single case studies have been reported, but no study fully acknowledges the importance of comparing different kinds of project-based companies, and to compare the variation in project competence. Our research started as single case studies where we sought to acquire in-depth knowledge about each of the companies included in our study. We picked large Swedish companies that stress “project management as a core competence”. We also wanted a group of firms that covered different industries. We searched for large, mature companies and for reasons of time and access we had to settle with four companies. We further needed companies that had a wide portfolio of projects, including projects to clients and internal development projects. Our intention was to focus on firms that have a certain complexity in their general activities and also that their project operations would show a broad scope and a certain degree of complexity. The companies included in our study were the following: ABB, Ericsson, Posten (the Swedish Post) and Skanska. The study of ABB began in 1995 as a single case study of a large international project in the Pacific region. We furthered our data with additional studies of international business projects and carried out a number of interviews with members of


00134


461

the project support unit. This created a broad set of data for the present paper. The information was complemented with three interviews with a division manager, a project manager and a project management specialist. The study of Ericsson started in 1994 as single case studies of a number of its most significant projects. We also initiated a study of inter-project learning in order to understand how “best practices” were transferred across projects. We continued to study a number of its most important development projects and we later on conducted a study of “project leadership skills” and the establishment of “project offices”. The intensive part of the empirical study was finalised at the beginning of 2001 and included five in-depth case studies of single projects and a number of interviews with managers to cover broader aspects of the company’s operations, e.g., its knowledge management routines. In order to improve the data for the present paper, we conducted three follow-up interviews with a senior project manager, a division head and a member of the staff of Ericsson Project Support. The study of Posten started in 2000 as two separate case studies of its turnaround project and the transformation of its project operations. The study focused specifically on the theme of “changing project operations”. During the course of our research, we have conducted more than 30 interviews and summarised our main findings in a separate book. The study of Skanska started in 2000 as a smaller, focused research project on the evolution of project competence. In this research effort, we relied heavily on interviews with two project managers and a country manager. We have also relied on secondary sources, both published by the company and by other researchers. In a second stage, we carried out three interviews with the Vice President, the former CEO and a former country manager/senior project manager. A separate empirical report on the evolution of project competence has been presented and discussed with the interviewees. We focused on these companies also for the reason that they run a large variety of different projects, including business projects, development projects and change projects. Other companies that would have been included for their equal emphasis on project competence were excluded because these firms did not show the same level of plurality in their project portfolio. Our aim was to gather an empirical base that facilitated both rich stories and made comparisons between the cases possible, according to the suggestion by Eisenhardt (1991).

Creating Competent Project Operations: A Four Company Experience In this section, we summarise the most important observations in our research studies. We present each of the companies and provide information about each


462

00134

J. Söderlund

company’s history, major changes and how they have worked to form and improve their project operations. ABB ABB is a multinational company with operations all over the world. The company employed at the time of our study (2000) more than 200,000 employees. The history of ABB goes back to the late nineteenth century, and is a long and illustrious record of innovation and technological leadership in many industries. Having helped countries all over the world to build, develop and maintain their infrastructures, ABB has in recent years moved from large-scale solutions to alternative energy and advanced products and technologies in power transmission and automation that constitute its industrial IT offerings. In the Annual Report from 1997 the company pointed to the importance of intelligent building systems: Our building systems customers are increasingly asking for total solutions that cover all of their needs, from lighting and ventilation systems to monitoring and control systems that ensure the most efficient use of electricity and system know-how and design and project management capabilities to meet this growing demand (Annual Report 1997, p. 23). Focusing on the project-intensive parts of the company, the firm has invested heavily in its capability of running projects. This is, for instance, true when it comes to the development program of the company’s project managers, the project management career ladder and the “project culture” of the ABB. The firm also stresses that projects is its core activity and estimates (at the time of our study) that more than 75 percent of its revenues comes from projects. ABB also runs a number of development and change projects. Development projects include the development of a new technology for power transmission, a new generator for power generation and new IT platforms. Change projects include the famous T50 program (Ekstedt and Wirdenius, 1995) and the implementation of ERP systems (Tjäder and Söderlund, 2001). Ericsson Ericsson is one of the leading players in the telecommunications industry. The company supplies telecom operators and service providers around the world with end-to-end solutions in mobile and broadband Internet. Ericsson offers solutions for most existing mobile systems, including future 3G mobile systems, as well as broadband multi-service networks and broadband access. The solutions include network infrastructure, access equipment and terminals, application enablers and


00134


463

global services to support both business and private communications. The company is present in more than 140 countries and employed more than 100,000 people at the time of our study (2000). Ericsson has for many decades been one of Sweden’s most important companies. The company stood for a large part of Sweden’s total export volume during the 1990s. The company runs several large and complex development projects and is continuously in charge of implementing new systems and solutions at the sites of its clients, for instance the implementation of a fully operative cellular system including switches and radio base stations. Further, the company has been running a number of large change projects in recent years. For instance, the development of a new organisational structure, the implementation of a new ERP system and the fusion of different competence centres in radio base technology. Skanska Skanska was founded in the late nineteenth century. The firm quickly developed its international activities and had operations in a number of European markets at the turn of the century. In the first decades of the twentieth century, the company was a key player in the development of the Swedish infrastructure, such as roads and bridges. The company also developed from being a supplier of products and services to take on larger responsibilities of turnkey projects. Today, Skanska is a multinational company employing nearly 80,000 people. The primary markets of Skanska are Sweden, the U.S., the U.K., Denmark, Finland, Norway, Poland, the Czech Republic, Argentina, Hong Kong and India. The strategy of Skanska is to become the world leader in construction-related services and project development. This strategy was in several ways developed during the time of our study (2002). Skanska is one of the leading players in the construction industry. The group has developed rapidly in recent years and is today a truly international player. More than 80 percent of its revenue relates to international operations. About 60 percent of sales are related to building construction. Civil construction consists mainly of infrastructure projects, for example, rail systems, bridges, tunnels, roads, harbors and power plants. A growing trend in civil construction is design-build, where Skanska assumes responsibility for a larger portion of the value chain. One of the interviewees estimated that Skanska projects normally account for between 80 and 90 percent of annual sales. Hence, Skanska is a truly project-dominated firm. The company also runs a small number of development projects, e.g., the development of new services, the development of concepts for intelligent buildings and new technology projects. In recent years, Skanska has carried out the RockVision3DTM project, a tomographic system that utilises seismic energy to produce three-dimensional images of underground structures and bedrock. The firm has also launched a number of R&D projects to develop technologies for the reinforcement


464

00134

J. Söderlund

of tunnels and handle the problems with moisture and mould in buildings. The company also runs a plethora of internal change projects, including IT projects, organisational change projects, etc. One such strategic project was the Skanska 3T project (see Ekstedt and Wirdenius, 1995). Posten Posten, the state-owned Swedish Postal firm, is one of Sweden’s oldest and largest companies. At the time of our study (2002), the company employed 50,000 individuals and had begun its international expansion. The strategy was to become the leading distributor and logistics company in the Nordic and Baltic regions. The company has changed dramatically in the recent decades. For instance, the development of information and communication technology has forced the company to develop additional services and change its business logic. To a large extent the company today works together with strategic partners that handle relationships with the mass market, while Posten concentrates on production (i.e., terminals for handling millions of parcels and letters) and the development of new services and products. The transformation of Posten is to a large extent driven by the challenges of substitute technologies, such as the Internet and fax machines. The company made a turn-around strategic change starting in the late 1990s culminating in a completely new service network, where all the old post offices were closed and a small number of full service centres run by Posten were opened. Besides this core service network, partnerships with more than 3000 partner-operated service outlets were established. This also showed the way to a greater focus on the company’s development activities. The company expanded its capabilities and launched a new business unit focusing entirely on outsourcing activities aimed at large Swedish companies and government institutions. The strategy was here to identify and sell large projects in cooperation with other industrial players. Strategies included new logistics solutions and internal mail handling. The company took the responsibility for analysing and changing much of the logistics and mail handling for these large clients. In this development process, the management team also identified project managers as being a key role in the company. Top management further stressed that they wanted Posten to become a “project company” where customer project leaders (for business projects), strategic project leaders (for large change and development projects) would play important roles. Concomitantly, the company has invested heavily in various processes and systems to support its project operations, for instance, by launching project selection tools, project models and project management career programmes.

Building Blocks of Project Competence In furthering the analysis of project competence, we suggest that project competence consists of a number of sub-processes or activities. In our initial analysis we


00134


465

Project context, environmental uncertainty and complexity

Project generation Project organising

Teamwork

Project leadership

Competitiveness Fig. 2. A project competence framework.

concluded that pre-project phases must be included in the analysis. Our empirical regularities and observations of earlier research (e.g., Pinto and Prescott, 1990) also showed the importance of teams and leadership in successful project operations. In our initial empirical study the following key activities emerged in a grounded theory analysis: project generation, project organising, project leadership and project teamwork. In this section, we will explain the theoretical underpinnings and the first empirical evidence of this model (see Fig. 2). Project generation All firms defined project generation to be at the core of their project operations. This was particularly clear in the interviews with top and division managers. They further stressed the importance of risk analysis and management, “business cases” and the building of networks in order to “get the best projects” (this was obvious in the studies of ABB, Ericsson and Skanska). All firms have struggled with various types of tools and models in order to improve their project generation and selection processes. For the internal projects (such as product development and change projects), the companies have launched various techniques in order to improve the analysis of the project portfolio and increase the likelihood of successful projects. Project organising All firms stressed the importance of having a good organisational structure and process for carrying out projects. Most of them have invested in the development of a project model to be used throughout the company. Some interviewees even say that the project model is the “carrier of the firm’s project competence”. The studied firms have also attempted various changes in the organisational structure of their


466

00134

J. Söderlund

project operations, for instance, by changing the meeting structures, the checkpoints and various types of forums during project execution. The facilitation of product and system modularity to improve project organising is another continuous struggle for the firms studied. Project leadership All the firms emphasised the importance of skilled project managers and wellfunctioning development opportunities for future project managers. However, when looking deeper into their specific leadership problems, the issue of leadership was a much more complex and collective effort than some of the interviewees thought. For instance, an important role of leadership was also played by the division head or another member of the top management team. Additionally, large, complex projects often rested upon the knowledge of a technical project manager to assist and perform the leadership issues in the project. In sum, we thus concluded that project leadership is a capability in their operations, but the capability is much more collective than one initially might assume. Project teamwork The firms under study all stressed the importance of well-functioning teamwork. In several ways, the strategy for teamwork has evolved and changed over the years. The firms have tried out cross-functional teams, cross-departmental teams, co-located teams and dispersed teams. Further, the firms have spent much effort in developing and expanding the teamwork competence of individual engineers and other employees. The relationship between the building blocks of our framework should be pointed out. For instance, we acknowledge the relationship between selection and organisation, but also that existing logics of organising have effects on the selection process. Similar relationships are found between the other activities in our model.

A Project Competence Framework: Five Patterns In this section, we illustrate the five main empirical patterns observed in our research. The patterns discussed are theoretically impregnated in the way that we believe that they also have some important effects on our current understanding of project competence. The following five patterns will be discussed: 1. The variation of project competence 2. The expansion of project competence 3. The shift of project competence


00134


467

4. The building blocks of project competence 5. The fit and dynamics between the building blocks The framework suggested acknowledges the variation of project competence and the importance of project competence to also cover a wide array of different projects. The expansion of project competence is based upon the understanding that project competence needs to, in order to be sustained, be continuously changed and modified. These changes might also provide the company with temporary advantages, or first mover advantages, over its competitors. However, not all changes in the project competence are major. There are a number of smaller shifts, expansions and changes of focus that are part of the project competence of the firm. Finally, our framework illuminates the importance of a number of activities supporting the project competence. These activities must be attuned and integrated into a functioning whole, and small changes in one activity, or building block, might lead to deep changes in the entire project competence of the firm. In the following sections, we describe these empirical regularities in further detail. We also relate our findings to some present theorising within the area in order to provide possible ways for theoretical interpretation. We will also describe how our case study firms have dealt with each of the subjects discussed. Project competence I: the variation of projects A large and complex firm, similar to the ones we have studied, runs a wide array of different projects. Some firms, such as in the construction industry, carry out most of their operations in various types of business projects, i.e., projects ordered by clients. Other firms do not supply firms to an external client but instead run projects on an internal basis. Typical examples include firms in the automotive industry and other mass-production industries. These companies spend as much as 20 or 30 percent of their earnings on R&D — activities that normally are organised by projects (Womack et al., 1990). Furthermore, change efforts are to a greater extent organised as projects. This was obvious from the findings of Whittington et al. (1999) and in the literature of strategic change in large, complex organisations, due to various types of complementarity. Given this, project competence must thus acknowledge the wide array of projects that companies normally carry out. The first empirical regularity in our research deals with the different types of project that the firms under study conduct. All projects are important, but some projects are more at the core of their normal operation. In our first analysis of the companies, we concluded that it was possible to categorise their project portfolio into three categories of projects. The first one, business projects, is the category of projects sold to clients. Typical examples would be complex system deliveries/


468

00134

J. Söderlund

projects, buildings, plants, turnkey projects, etc., that clients need in order to carry out other operations (e.g., production facilities, office buildings). As an example of such projects, the literature points to “large engineering projects” as important for industrial activity in general (see, e.g., Miller and Lessard, 2000). A second category includes various types of development projects, i.e., projects meant for internal purposes (such as the development of new products, services and technologies). A third and final category, so-called change projects, contains projects for transforming and developing the structure and processes of the company. Each type of project is not equally important for every firm. For instance, in the case of Skanska, the core projects are business projects and the second most important are development projects. The company estimates that more than 80 percent of its revenue comes from business projects. The situation is similar for ABB. At the time of our study, managers estimated the percentage of revenues from business projects to account for more than 75 percent. In Ericsson, the business projects are important but a large portion of its revenue comes from other activities (such as consulting services, product sales). The study of Davies and Brady (2000) estimated that Ericsson’s revenues from “turnkey projects” were exceeding 10 percent of annual sales. In the case of Posten, revenue from projects accounts for a relatively small portion, estimated at approximately 5 percent. The aim here is to make a first comparison between the companies and their project portfolios. At ABB and Skanska the business projects, no doubt, are core activities. At Ericsson the business projects are important but do not constitute its core. As one of its managers stated: “Turnkey projects represent a way to create business, but we would prefer focusing on technology and product development”. In the case of Posten, projects had a role of extending and diversifying the company’s business on a diminishing market due to rapid technology development for substitute products. The business projects here had a role of diversifying, or trying out new business ventures. This was also something that the company considered to be a relatively low risk business, because no large investments were needed to develop the concept of business projects. Table 1 summarises the comparison between the companies. The above analysis has illustrated the possibility of classifying companies’ operations into one of the three project types suggested. The point made was that different types of project play different roles in the various firms, but looking at the problem from a wider perspective, we realise that all projects are important for sustaining the companies’ project competence. Proposition 1. Project competence is developed in a combination of different types of project, though one project type seems to dominate in the project competence of


00134


469

Table 1. Comparison of project operations. Business projects

Development projects

Change projects

ABB

Core (primary source of revenue)

Supporting (sustaining technological leadership, improving cost efficiency) and diversification (developing new business opportunities)

Supporting (changing organisational structure, improving working methods)

Ericsson

Diversification (turnkey projects to create new business opportunities)

Core (development of systems)

Supporting (adapting organisational structures, implementing new work processes)

Posten

Supporting (new business opportunities)

Diversification (new products and services, often under the label of change projects)

Core (main focus of management)

Skanska

Core (primary source of revenue)

Supporting (new technologies)

Supporting (adapting organisational structures, implementing management information systems)

the firm. The project competence of the firm must, however, cover all three major types of project. Project competence II: the expansion of project competence The project competence framework also needs to take into account how project competence evolves, changes and is adjusted over time. We suggest two primary ways in which this occurs: the “expansion” and the “shifting focus” of project competence. The expansion of project competence will be discussed in this section. Major expansions have been the focal point of much writings within the domain of organisational capabilities. These major expansions are, for sure, of great importance for the management of turnarounds and transformations of a firm; however, they are only one part of the problem. Some firms do not even experience such major shifts. The study of Davies and Brady (2000) documented one such major expansion in their study of Ericsson — the emergence of turnkey projects. In our research we have focused on the recent decades and the most significant expansions of each of the firms’ project competence.


470

00134

J. Söderlund

ABB The company started to a large extent as a product and apparatus supplier in the electric equipment industry. For various reasons, the firm adopted a turnkey and systems delivery strategy on an increasingly international market. The company therefore developed its capability in systems deliveries and offered services to take on the full responsibility for implementing power generation and transmission systems. This was especially important for clients who had outsourced their own technological capabilities. The company also searched for solutions to assist clients to arrange with financial solutions. This has been an important issue for the business of the firm for ages but became accentuated when ABB worked with clients in the third world and with private utilities in deregulated markets. The company also developed contracts similar to build–operate–transfer. In later years the company has augmented its business projects in a range of ways, for instance, by developing after sales and consulting services. ABB has also developed strategies to be more proactive on an international and increased complex market. In the evolution of ABB’s project competence three stages seem to be most important. The first is the development of system deliveries and turnkey projects, the next is the development of financial solutions and the third, and most recent one, is the augmentation of projects and increasingly proactive strategies and valueadded services. Ericsson The Ericsson case is difficult in several ways. The firm has a long tradition of large development projects and a number of high-technology super projects. In one sense the history of Ericsson resembles that of ABB, this being particularly true for its business projects. For instance, Ericsson developed turnkey concepts and financed projects, e.g., the CEO stated that the role of board member Tom Hedelius, former CEO of a leading Swedish bank, was to provide expertise in project finance. Ericsson has also developed various types of value-added services and in that sense augmented its business projects. The development work has changed and evolved in a somewhat different way. During the 1990s, the development activities were to a large extent directed towards systems development for digital cellular technology. Large development projects were carried out in order to develop systems for the three main world standards: GSM, PDC and D-AMPS. In unison, the company developed several types of radio base stations to meet the needs of its clients. The development projects have expanded and changed in several ways. The people in charge talk about changes in complexity and the number of technology areas that must be integrated as the most profound change for their development projects.


00134


471

Posten Posten was for many years a traditional service company that spent only a small portion of its earnings on R&D. During the 1990s, the situation changed rapidly. The company launched a number of large development projects, among them one of the largest Internet projects in Swedish history. Furthermore, the company developed products based on information and communication technology also in other areas, for instance, to facilitate improved production throughput and to launch new services to meet the competition from a number of new competitors. The Swedish postal market was deregulated during this period and Posten was formed into a state-owned for-profit company. The company has also since then expanded internationally, most notably in the Nordic and Baltic regions. Skanska The Skanska case has several resemblances to the ABB story. The firm started as a specialist in certain concrete technologies and took on larger system responsibilities for its clients. A first breakthrough for the company’s turnkey deliveries was in the 1970s when it built a hotel in Warsaw. Skanska has also developed various types of financial solution and has in recent years developed additional services and augmented the “project concept” considerably. The company describes its transformation as “in the beginning there was construction, now there are finance, project development and services”. Based on the observations in our case-study firms, we have identified a number of major changes in their project operations. The following proposition summarises this empirical regularity. Proposition 2. Project competence is developed over time in a complex interrelationship between reactive and proactive actions to market and technology issues. Some major expansions in the firms’ project competence have been observed, even though they are relatively rare. Project competence III: the shifts of project competence Our studies indicate that project competence is not only apparent in the major expansions of project logics as discussed above. Of equal importance are the minor steps, shifts and the ability to adjust the project logic to the current situation. In our study, the companies seem to focus on time, quality and specification, according to the classic triple constraints in project management texts. In the Ericsson case, we observed that the company at the beginning of the 1990s was running several large-scale and very time-pressured projects. Earlier, the time pressure had not been as important, instead development was more focused


472

00134

J. Söderlund

on quality issues. In the Posten case, we noted that the large Internet projects were heavily time focused, whereas later projects were cost focused. In the cases of ABB and Skanska, we could not see any clear pattern of shifts in project competence; however, there existed some clear differences between projects. For instance, certain prestigious projects were considered to be more time and quality focused than other projects. Our empirical study thus suggests the following proposition: Proposition 3. Project competence is adjusted to fit current market and technology needs. Such adjustments cause the firm to balance the focus of the triple constraints of time, cost and quality. These adjustments occur on a frequent basis, a small change in technology or market development might cause a shift in focus of the project competence. Project competence IV: the building blocks of project competence In our study, we have concluded that the project competence of the studied firms could be categorised into four building blocks where each building block represents a core activity in the project operations of the firm. The categorisation is based on interviews and descriptions of the problematics with the firms’ project operations that has been discussed with senior and project managers at workshops and meetings. This categorisation also is based on the analysis of each of the single case studies. The categorisation follows the framework presented earlier. In this section, we describe in more detail how each of these activities have developed and changed during the history of our case-study firms. We argue that the investments made and major developments of the companies’ project operations could be grouped into either one of these four building blocks. Project generation In the ABB case, project generation has been closely integrated with the firm’s business competence. Considerable efforts have been put into establishing and building worldwide networks with clients and consultants in order to improve the company’s possibilities of gaining new projects. The company has also developed strategies to be “ahead of their competitors” in order to increase the possibility to win the “good projects”. In terms of project generation the interplay between management levels seem to be of utmost importance. For instance, in some projects top management is utilised by lower levels of the hierarchy to arrange meetings with potential clients and to build power coalitions with various key groups in upcoming projects. Skanska has followed a similar pattern. Skanska has invested heavily in becoming a “project developer” to take a more proactive role in the project generation process. This has led the company to recruit new employees with a particular competence


00134


473

in developing projects, arranging for financial solutions and providing the projects with contractual expertise. Ericsson has emphasised project generation and put much effort to improve its capability of “product management”. Product managers have been trained and given the responsibility to form new projects and to prioritise between development projects and also decide about the content of development projects. In cooperation with a Swedish software vendor, Ericsson has implemented a system for project portfolio management. Posten has invested in improving its competence in determining the “business value” of development and change projects. Together with an international management-consulting firm, Posten has developed a model for screening and analysing project ideas. Project organising Ericsson has spent much energy on developing a structural and widely adopted project management model to be used in all its projects. The model provides the organisation with “a terminology and a way of looking at how projects should be executed”. The other companies, however, not with the same magnitude, have launched comparable project models. Ericsson has continuously changed and modified its organisation to better meet the demands of its project operations. The increased number of projects called for the establishment of “project management offices” and a separate project support unit to take on the duties of spreading knowledge between projects and to provide training programmes for project managers on various levels of the organisational hierarchy. The increased complexity of development projects also called for new project management structures and logics. At the first stage of development, this was normally done by increasing “leadership capacity” at the project level by appointing a technical project manager. At the next stage of complexity, they developed ways to modularise and divide the system into smaller units. Despite these efforts, project organising at Ericsson greatly relied upon other measures, such as various types of meeting structures, integration devices, arenas and colocated projects (Adler, 1999; Söderlund, 2002). The interviewees also pointed to the importance of transferring these “softer” management issues across the organisation. The Skanska case also illustrates the continuous development of organisational structures to meet the needs of projects. For instance, it created separate companies such as Skanska Integrated Projects to focus on a separate market segment of the U.K. market. The company also started the Skanska International Projects unit to improve its operations on growth markets. Skanska stresses the need of having socalled “integrated teams” — from finance, design and construction to operations and maintenance — to provide the project with adequate knowledge from diverse disciplines.


474

00134

J. Söderlund

ABB has continuously improved and adjusted its organisation to better meet the requirements of the projects. For instance, in one of the units we studied we could see that the division was transformed to better support a single large project. In other cases, we noted that division management took an active part in the management of projects, for instance, in handling certain problems and similar solutions to increase the organisational support of the projects (cf. Dahlgren and Söderlund, 2001). Project leadership All companies have given much attention to the development of project management careers. They have also supplemented this career ladder with a large number of courses and development programmes. As one of the interviewees stated, “we had careers for specialists and managers, but not for project managers who often were much more important than the other ones”. However, we could also observe that the companies did not find the situation to be sound. This was primarily explained by the weak organisation of internal clients and project sponsors. The companies seem to have slowly developed an awareness of the importance of a good working relationship between project managers and internal clients. Several of the interviewees stressed the key role of internal clients in securing the ground rules for the projects and for the management of project stakeholders. Furthermore, in large and complex projects (as often is the case in these companies) there is a need for extending the project management capacity. Therefore, projects normally have an assistant project manager or a technical project manager that has the overall responsibility for the technological process of the project. For instance, ABB appoints project technical directors and Posten has created the role of technical sub-project managers. Skanska has developed a separate institute — The Skanska Leadership Institute — in order to increase the number of highly skilled project managers. The institute is also responsible for assessing the qualities of project managers and suggesting development programmes to sustain their leadership capability within the firm. As it seems, much effort has been put into clarifying the role of project managers and increasing the project management capacity. The firms tend to increasingly broaden their view of the scope of project management and project leadership and hence expand its role and include more functions. One function is to champion the project and the other is to increase the technical leadership capacity. Building on the earlier introduced framework, one might assume that these two expansions of project management capacity relate to a simultaneous improvement of the relationship between the business process (cf. champion, internal client) and the technological process (cf. technical project manager, assistant project manager).


00134


475

Project teamwork In several ways, the firms have expanded and changed their capacity to improve project teamwork. Several of the companies have stressed the importance of “networks” and “the networked individual” in order to point to the individual’s personal responsibility in improving teamwork. They have also tried out various solutions to the problem of well-functioning teams, for instance, by installing teamwork processes to be included in their project management models. They have also stressed teamwork in their training programmes for project managers. The above-described observations about the building blocks of project competence could be summarised in the following proposition: Proposition 4. Project competence consists of four building blocks: project generation, project organising, project leadership and project teamwork. Project competence V: the fit and dynamics between building blocks The final empirical regularity not only extends but also summarises the previously discussed regularities. We argue that the firm must produce a dynamic fit between the building blocks of project competence discussed in the previous section. Furthermore, a change in one building block might have severe consequences on one or more of the other building blocks. For instance, the type of projects selected (cf. project generation) will affect the efficiency of the current organisational structures and processes (cf. project organising). Moreover, some projects generated might lack necessary leadership capacity (cf. project leadership). In the business projects we found some clear examples of this, for instance, key project leaders lacked knowledge about a certain category of client. In other cases, project leaders lacked the necessary skills for dealing with a new (and more uncertain) technology. Additionally, we could observe that an increase in project leadership capacity also had some obvious effects on the project selected. In the Ericsson case, senior project managers influenced product managers to prioritise projects for which the project managers felt more strongly. In sum, our observations on the building blocks of project competence give us to the following proposition: Proposition 5. Changes in one building block of the project competence might have severe consequences on the other building blocks. Project competence is constituted in the fit and dynamics between the identified building blocks.

The Traps and Future of Project Competence The above analysis has provided us with a basic model to understand and explain the activities of firms that build and sustain project competence. The propositions


476

00134

J. Söderlund

presented might also provide grounds for future research and comparisons between firms and industries. Developing and sustaining project competence in our conception is about the handling of major expansions, minor shifts and the development and dynamics of the building blocks identified. Furthermore, project competence must also be viewed in the light of the complexity of the project portfolio of the firm. Developing project competence, we believe, is also a matter of fostering management of different project types and transferring lessons learned between these project types. Sustaining competence is also a process that is associated with various types of “competency traps” (March, 1994) and “core rigidities” (Leonard-Barton, 1992). In the literature on capabilities and competences, a number of researchers have pointed out the dangers of such rigidities. We argue that a framework of developing project competence also must acknowledge associated competence traps. Our research points to the dangers of primarily four project competence traps. Each competence trap is associated with one of the four building blocks discussed earlier: (1) narrow project selection, (2) re-use of obsolete project organisation structures, (3) dangerous project heroes and (4) recycled successful project teams. We will here only briefly discuss these four identified traps. The matter of narrow selection is not a very unique observation. As is well known from theories of learning, actors tend to prefer known situations by applying a “more-of-the-same logic” even though another logic is preferable (Hedberg, 1981). However, a robust framework of how a firm develops project competence must rest upon insights of how companies strive to escape from such a trap. We would argue that insights into these issues are equally important as the question of how firms have managed the major expansions of their project competence. Hence, unreflective exploitation might easily lead to narrow project selection and rigid project organisations. In our empirical study, although not its primary focus, we observe strong tendencies to re-use organisational structures that were ill fitted for new projects. We also saw several examples of how teams were re-used and how project managers were turned into project heroes that were considered to be the only ones within the firm that could take on certain project duties. Nevertheless, it was clear that a few of the development problems that the firms experienced were related to parallel issues. For instance, the firm was not able to increase its leadership capacity, and the firm ran the risk of depending on too few key actors for handling its project operations. The fourth and final project competence trap relates to the re-use of successful teams. As illustrated by Katz (1982) group longevity might be a key problem in project performance. Old groups tend to be less effective and more ignorant to important changes in technological opportunities and market changes. In our research,


00134


477

even though at times the re-use of teams was critical for knowledge transfer, at times re-use of project teams also lead to unmindful team members. Using the project competence framework may provide us with additional understanding of a few problems facing companies that to a large extent rely on projectbased activities. The competence-traps analysis is one way, and the analysis of development stages or typical problems is another. The framework elaborated on in this paper contributes to and extends our understanding of project-based firms — or more specifically — firms that view projects to be at the core of their operations. We argue that this particular category of firms is on the increase and the framework should thus be of importance also for an increasing number of companies. We pointed to the importance of extending the project competence framework also to other types of projects. In doing that we emphasised the need for a broader perspective on the matter of project competence as important also for understanding the firm’s business and technology competences. Furthermore, we argued that project competence as such must be grouped into a number of building blocks (project generation, project organising, project leadership, project teamwork). Based on these building blocks we illustrated the major competence traps identified in our empirical work. Our research pointed to narrow selection, re-use of structures, re-use of key actors and existing teams to be the most obvious and important traps. Each trap identified relates to one of the building blocks analysed in the article. This article has aimed at broadening our understanding of organisational capabilities and the role of project competence. In the article we stated some arguments that we believe are important in the establishment of a theory of project competence. Most notably, these arguments were based on a critique of present writings on organisational capabilities and project management. The first, and perhaps most important one, is that project competence must be viewed more broadly than has previously been done. We argue, for instance, that project generation is a key strategic process in many project-based firms. We also argued that project competence is often one of the strategic competences of the modern firm. We outlined a framework based on some classic work on product development and project management. The first issue is to understand the balance between these strategic competences. For instance, the relationship between the business process and project process is of utmost importance in several industries (see Gann and Salter, 2000). Finally, we suggest more structured approaches to compare various efforts by similar companies in enhancing their project competence. We submit that the model elaborated upon in this paper might provide a fruitful explanation to the differences between high and low performers in project-dominated industries. The propositions given in this paper should be tested in future empirical studies and comparisons between firms and industries in order to further our understanding of project competence and its development.


478

00134

J. Söderlund

References Adler, N (1999). Managing complex product development: Three approaches. Published doctoral dissertation, Stockholm School of Economics, Stockholm. Allen, TJ (1977). Managing the Flow of Technology. Cambridge: MIT Press. Bayart, D, Y Bonhomme and C Midler (2000). Management tools for R&D project portfolios in complex organizations: The case of an international pharmaceutical firm. In Innovation-Based Competition and Design Systems Dynamics, PJ Benghozi, F CharueDuboc and C Midler (eds.) Paris: L’Harmattan. Berggren, C, J Söderlund and C Anderson (2001). Clients, contractors, and consultants: The consequences of organizational fragmentation in contemporary project environments. Project Management Journal, 32(3), 39–48. Bowen, HK, KB Clark, CA Holloway and SC Wheelwright (1994). The Perpetual Enterprise Machine. New York: Oxford University Press. Bower, JL (1970). Managing the Resource Allocation Process: A Study of Corporate Planning and Investment. Boston: Harvard Business School. Chandler, A (1990). Scale and Scope: The Dynamics of Industrial Capitalism. Cambridge: Belknap Press. Chandler, A (1992). Organizational capabilities and the economic history of the industrial enterprise. Journal of Economic Perspectives, 6(3), 79–100. Clark, K and T Fujimoto (1991). Product Development Performance: Strategy, Organization Management in the World Auto Industry. Boston: HBS Press. Cova, B and K Holstius (1993). How to create competitive advantage in project business. Journal of Marketing Management, 9(2), 105–121. Dahlgren, J and J Söderlund (2001). Managing inter-firm projects — on pacing and matching hierarchies. International Business Review, 10, 305–322. DeFillippi, R and M Arthur (1998). The paradox in project-based enterprise: The case of film making. California Management Review, 40(2), 125–139. Davies, A (1997). The life cycle of a complex product system. International Journal of Innovation Management, 1(3), 229–256. Davies, A and T Brady (2000). Organizational capabilities and learning in complex product systems: Towards repeatable solutions. Research Policy, 29, 931–953. Eisenhardt, K (1989). Building theories from case study research. Academy of Management Review, 14, 532–550. Eisenhardt, K (1991). Better stories and better constructs: The case for rigor and comparative study. Academy of Management Review, 16(4), 620–627. Ekstedt, E, RA Lundin, A Söderholm and H Wirdenius (1999). Neo-Industrial Organising: Renewal by Action and Knowledge Formation in a Project-Intensive Economy. London: Routledge. Ekstedt, E and H Wirdenius (1995). Renewal projects: Sender target and receiver competence in ABB “T50” and Skanska “3T”. Scandinavian Journal of Management, 11(4), 409–422. Engwall, M (2003). No project is an island: Linking projects to history and context. Research Policy, 32, 789–808.


00134


479

Ekynsmith, C (2002). Project organization, embeddedness and risk in magazine publishing. Regional Studies, 36(3), 229–243. Gaddis, PO (1959). The project manager. Harvard Business Review, May–June, 89–97. Galbraith, J (1977). Organizational Design. Reading: Addison-Wesley. Gann, D and A Salter (2000). Innovation in project-based, service-enhanced firms: The construction of complex products and systems. Research Policy, 29, 955–972. Genus, A (1997). Managing large-scale technology and inter-organizational relations: The case of the Channel tunnel. Research Policy, 26, 169–189. Geyer, A and A Davies (2000). Managing project-system interfaces: Case studies of railway projects in restructured UK and German markets. Research Policy, 29, 991–1013. Grabher, G (2001). Ecologies of creativity: The village, the group, and the heterarchic organization of the British advertising industry. Environment Planning, 33, 351–374. Grabher, G (2004). Learning in projects, remembering in networks? Communality, sociality, and connectivity in project ecologies. European Urban and Regional Studies, 11(2), 103–123. Grant, RM (1996). Toward a knowledge-based theory of the firm. Strategic Management Journal, 17(Special Issue), 109–122. Hedberg, G (1981). How organizations learn and unlearn. In Handbook of Organizational Design, P Nystrom and W Starbuck (eds.). New York: Oxford University Press. Hedlund, G (1994). A model of knowledge management and the N-form corporation. Strategic Management Journal, 14, 73–90. Henderson, R and K Clark (1990). Architectural innovation: The reconfiguration of existing product technologies and the failure of established firms. Administrative Science Quarterly, 35(1), 9–30. Hobday, M (1998). Product complexity, innovation and industrial organization. Research Policy, 26, 689–710. Hobday, M (2000). The project-based organization: An ideal form for management of complex products and systems? Research Policy, 29, 871–893. Iansiti, M (1998). Technology Integration: Making Critical Choices in a Dynamic World. Boston: HBS Press. Katz, R (1982). The effects of group longevity on project communication and performance. Administrative Science Quarterly, 27, 81–104. Kogut, B and U Zander (1992). Knowledge of the firm, combinative capabilities and the replication of technology. Organization Science, 3(3), 383–397. Leonard-Barton, D (1992). Core capabilities and core rigidities: A paradox in managing new product development. Strategic Management Journal, 12, 111–125. Lindkvist, L (2004). Governing project-based firms. Promoting market-like processes within hierarchies. Journal of Management and Governance, 8, 3–25. Lindkvist, L, J Söderlund and F Tell (1998). Managing product development projects: On the significance of fountains and deadlines. Organization Studies, 17(6), 931–951. March, JG (1994). A Primer on Decision-Making. New York: Free Press. March, JG (1996). The future, disposable organizations and the rigidities of imagination. Organization, 2(3–4), 427–440.


480

00134

J. Söderlund

Midler, C (1995). Projectification of the firm: The Renault case. Scandinavian Journal of Management, 11(4), 363–376. Miller, R and D Lessard (2000). The Strategic Management of Large Engineering Projects. Boston: MIT Press. Mintzberg, H (1979). The Structuring of Organizations. New York: Prentice Hall. Morris, P (1994). The Management of Projects. London: Thomas Telford. Nelson, R (1991). Why do firms differ, and how does it matter? Strategic Management Journal, 12(8), 61–73. Nelson, R and S Winter (1982). An Evolutionary Theory of Economic Change. Cambridge: The Belknap Press. Patel, P and K Pavitt (1997). The technological competencies of the world’s largest firms: Complex and path-dependent, but not much variety. Research Policy, 26, 141–156. Pinto, JK and JE Prescott (1990). Planning and tactical factors in the project implementation process. Journal of Management Studies, 27(3), 305–327. Prahalad, C and G Hamel (1990). The core competence of the corporation. Harvard Business Review, May–June, 79–91. Prencipe, A and F Tell (2001). Inter-project learning: Processes and outcomes of knowledge codification in project-based firms. Research Policy, 30, 1373–1394. Shenhar, A and D Dvir (1996). Toward a typological theory of project management. Research Policy, 25, 607–632. Söderlund, J (2002). Managing complex development projects: Arenas, knowledge processes and time. R&D Management, 32(5), 419–430. Söderlund, J (2004). Building theories of project management: Past research, questions for the future. International Journal of Project Management, 22, 183–191. Teece, D and G Pisano (1994). The dynamic capabilities of firms: An introduction. Industrial and Corporate Change, 3(3), 537–556. Tjäder, J and J Söderlund (2001). Ledning av IT-projekt: kontroll och lärande. In Projekt: organisation för målorientering och lärande, C Berggren and L Lindkvist (eds.). Lund: Studentlitteratur (in Swedish). Williamson, OE (1999). Strategy research: Governance and competence perspectives. Strategic Management Journal, 20, 1087–1108. Winch, G (2000). The management of projects as a generic business process. In Projects as Guiding Motives for Business, R Lundin and F Hartman (eds.). Boston: Kluwer Academic Publishers. Whittington, R, A Pettigrew, S Peck, E Fenton and M Conyon (1999). Change and complementarities in the new competitive landscape: A European panel study, 1992–1996. Organization Science, 10(5), 583–600. Windeler, A and J Sydow (2000). Project networks and changing industry practices: Collaborative content production in the German television industry. Organization Studies, 22(6), 1035–1060. Womack, J, D Jones and D Roos (1990). The Machine that Changed the World. New York: Rawson.