Eight to Late

It is a truism that two organisations using the same project management practices and structures will have different levels of success with them. Clearly, there’s a lot more to project success than project management. Despite this, most studies of project success tend to focus on  project level, or operational, variables such as  level of user involvement, use (or not) of a formal methodology, reliability of estimates etc (Note: these variables have been taken from the oft quoted Standish Report). As important as these factors are, they fail to take into account that projects live and evolve in a wider environment which includes the sponsoring organisation.   A recent paper entitled, New Product Development Projects: The Effects of Organizational Culture published in the December 2007 issue of the Project Management Journal, studies the effect of organisational culture on project success with specific reference to new product development (NPD) projects.  I summarise and review the paper below.

The authors claim that despite the importance of NPD projects for the long term success of an organisation, the effect of strategic level variables (organisational culture, organizational strategy, management involvement etc.)  on project success has not been widely studied. They suggest this might be so because these variables are hard to define, quantify and measure.  Further, on reviewing the existing literature, they find that the few published, organisation-oriented studies tend to focus on the end result of the development process (i.e. the product) rather than on factors affecting the project. Hence the motivation for their study.

Incidentally, they note that there has been some work on the effect of national culture on NPD project performance,  but these studies find no correlation between the two.

To measure something as elusive as organisational culture, you first have to pin it down by defining it. The definition does not have to be all-encompassing, but it needs to be precise enough for people to have a common understanding of what you’re talking about. To do this, the authors created a set of questions based on various definitions of organisational culture available in the literature. The resulting questionnaires were mailed out to various organisations engaged in NPD projects. The responses received (from over a hundred organisations) were analysed using  exploratory factor analysis,  enabling the authors to group the questions  into the following dimensions of organisational culture:

• Positive work environment: this includes factors such as
  •  openness to new ideas,
  • employees feeling valued as individuals,
  • open discussion with superiors encouraged etc.
• Management leadership:  this includes factors such as
  •  clear goals set and responsibilities delegated,
  • employees have input in decision making, 
  • incentives offered to work on new ideas, 
  • high-risk high-return projects encouraged etc.
• Results orientation: this includes factors such as
  • employees are pressured to finish work,
  • correct procedures more important than correct results etc.

These dimensions define organisational culture for the purposes of their study. 

To measure project success, the authors use the following dimensions adapted from Griffin and Page:

• Consumer-based:  the customers are satisfied with the product. This can also be classed as Customer Satisfaction.
• Commercial success: the product makes money
• Technical success: the product works as intended.

Note that these variables are actually a subset of those suggested by Griffin and Page. 

Project success was measured by getting upper management in the surveyed companies to rate product success along each of the above dimensions.

Finally, the authors correlate organisational culture to product success (for the surveyed companies) using correlation and regression analysis. The results (which are really no surprise) indicate that:

• Positive work environments and management leadership are strongly correlated with each other and with the three measures of product success. That is: 
  • Strong management leadership and positive work environments go hand-in-hand. 
  • Companies with positive work environments (and, by implication, strong management leadership)  have better commercial success with new products, enjoy better customer satisfaction and have greater technical success than those with less positive work environments (and, by implication, weak leadership).
• Results orientation is not strongly correlated with any of the other variables. If this seems surprising at first sight, take another look at what goes into making up this variable and it will seem less so!

Although the paper focuses on NPD projects, I think the conclusions – especially those pertaining to customer satisfaction and technical success –  apply to other  projects  as well.  Further, though the conclusions may be obvious to many, such research is important because it lends analytical backing to otherwise intuitive notions. It does this by:

• Defining (albeit, in a limited way) what is meant by organisational culture and project success.
• Studying the relationship between the variables that make up the two. 

Defining variables and quantifying relationships can give us a sense for which organisational culture variables are the most significant determinants of project success. So, although the study is a preliminary one (as the authors themselves admit), the work is a useful step in understanding the relationship between projects and the larger environment in which projects live and breathe.

References:

Belassi, W., Kondra, A. Z.,  and Tukel, O. I., New Product Development Projects: The Effects of Organizational Culture, Project Management Journal, 38 (4), 12-24 (2007).

Since project management, as a discipline, originated in a Western culture, incompatibilities between project management values / beliefs and those of traditional Asian cultures  are to be expected. Most readers who have worked both in Western and Asian organisations will be well aware of these differences. A recent paper entitled Cultural barriers to the use of Western project management in Chinese enterprises: Some empirical evidence from Yunnan province explores these differences in the context of Chinese organisations (see reference at the end of this post). Specifically, the authors look at four contrasting value/belief pairs, which cover the major differences between the two cultures:

1. Integration management vs. doctrine of the mean: This refers to the contrast between project management practices –  which generally emphasise integrating opinions, resolving conflicts and confronting risks –  as opposed to traditional Chinese (and dare I say, Asian) practices in which confrontations and risks are avoided as far as possible.
2. Horizontal management vs. strong hierarchy: This refers to the incompatibility between project management, which works best in a flat (or project-oriented) hierarchy,  and the strong vertical hierarchies prevalent in Chinese organisations. The latter organisational structure tends to emphasise superior-subordinate relationships in which “questioning the boss” is not encouraged.
3. Team consciousness vs. family consciousness Project teams are generally temporary, and tend to emphasise collaborative work across functions and merit-oriented performance evaluations. On the other hand, Chinese culture values long-term family and kinship relationships. These are not always compatible with cross-functional (or even intra-functional!) collaboration or performance-based recognition.
4. Task orientation vs. boss orientation  In project management getting the job done is paramount, whereas in Chinese culture the emphasis is on keeping the boss happy.

The authors developed a questionnaire to explore the relative importance of each of the above value/belief pairs. Based on the questionnaire, they conducted a survey involving respondents from a wide variety of industries in Yunnan province.

The analysis of the results revealed that the major cultural barriers to project management in Chinese organisations are the last three items: i.e.  strong hierarchy, family consciousness and boss orientation. It is interesting that a majority of the respondents thought that the doctrine of the mean was consistent the integrative nature of project management.

The authors also find that the barriers tend to be larger in state owned organisations than in private or joint ventures. Further, within state-owned organisations, older ones tended to have larger barriers than younger ones.

Also interesting is the find that project management training has a critical effect on lowering cultural barriers: As more individuals in an organisation received relevant training, the organisation became more supportive of project management practices.

The authors end with the caveat that their conclusions are based on the result of a single (yet representative) survey, and must therefore be treated as a pilot study.

I  found this paper worth reading because it articulates and explores some of the contrasts I have noticed in my own work with  organisations in India, Australia and the US.  In my experience, many of the observations made regarding cultural barriers to PM practices apply to (non-Chinese) Asian cultures as well. Those of you who work with cross-cultural project teams – particularly those across Asian and Western cultures –  may find this paper a worthwhile read.

Reference:

Wang, X. and Liu, L., Cultural barriers to the use of Western project management in Chinese enterprises: Some empirical evidence from Yunnan province, Project Management Journal, 38(3), 61-73 (2007).