Management of Large Projects and Programs in Construction Industry - Literature review Example

Management of Large Projects and Programs in Construction Industry Student name Course name Institution Date of submission Student Number Introduction Morris (2013: p.285) states that people are vital to the successful development and implementation of a project. He went on to suggest that Institution Theory is under-utilised foundation for integrating the effects of structure and the actors, adding that though people should never be compromised, this is always the case. This paper shows that Morris (2013: p.285) statement is specifically relevant to the management of large projects and programmes. Also explored include focus on governance and stakeholder engagement within the context of the statement. Management of large projects In particular, global construction projects, such as the Kattadam construction projects in Germany, which require collaboration between people from different countries, usually experience high costs and unique challenges because of cross-national interactions (Navarra & Cornfield 2009). In a case study that Mahalingam and Levitt (2007) performed to look into the cross-national interactions occurring at Kattadam construction projects in Germany, the researchers found that institutional differences was a major hindrance to inclusion of people in project development and implementation. Mahalingam and Levitt (2007) listed these differences as legal regulations, organisational cultures, and cultural distance. These differences, as they established, contributed to higher costs leading to the tendency to avoid the application of people-centred approaches in project development. Towards this end, institutional theory can be used to comprehensively illustrate the cross-national challenges that characterise international projects. In particular, the theory can assist in classifying the cross-national issues that a project management may run into, establish the underlying causes of the conflicts, as well as judge the ease with which each form of conflict should be addressed (Peters 2000). The institutional theory applies in the case of Kattadam projects in Germany as Mahalingam and Levitt (2007) have showed. In particular, Mahalingam and Levitt (2007) conducted a case study on construction projects that involved an American company -- Kattadam Inc -- that undertakes multiple projects in Europe in order to investigate the types of complexities that characterise such projects. Mahalingam and Levitt (2007) established that cost overruns, communication, and cultural barriers made it difficult to include people from different cultures in the construction projects. Indeed, globalisation has resulted to increase in amount of “global projects” that require collaboration between people from countries. The same scenario is typical of large engineering projects, of large global projects involving high amount of technological and organizational complexity, as well as intricate coordination efforts. These kinds of complexities in addition to other factors, such as environmental, economic, and political uncertainties often result to confusion between the participants in a project, as well as greater costs and delays. Mahalingam and Levitt (2007) views that it is such factors that have forced project managers at Kattadam construction projects in Germany and France to compromise on people, even though they do not have to. In a review of large construction and engineering projects in the nuclear, power, energy and petrochemical industries, Miller and Lessard (2007), established that cost overruns was commonplace and could vary between 30 and 700% of approximated costs. Additionally, the complexities that characterised many large engineering projects of international scale, compared to the non-global projects of the same size included interactions among organisations, individuals, as well as agencies from various cultural contexts and backgrounds. These interactions, even on the technologically routine international projects, usually resulted to additional higher transaction costs, conflicts, misunderstanding due to language and cultural barriers, as well as frequent friction between project management team and the people participating in the projects. In turn, Mahalingam and Levitt (2007) suggest that these variables further contributed to additional time and cost overruns. They further mentions that such risks and inherent high costs significantly affected the development and implementation of projects. Such costs and risks are not trivial and are exclusive to global projects. Despite the fact that the cultural parameters that Mahalingam and Levitt (2007) considered can help explain several unique conflicts occurring in construction projects, they do have several limitations. These cultural parameters, which Mahalingam and Levitt (2007) consider, adopt a broad perspective of culture. They also attribute similar features to all people participation in a project from a specific national group. Additionally, few efforts are made to differentiate the cultures of engineers with various levels of expertise or cultural background. In this respect, the contextual factors unique to construction projects, like certain engineering work practices linked to best practices or quality and safety practices, in addition to the dissimilarities of these variables, various national groups and the resulting problems they lead to, are often ignored. Hence, the concepts and theories rooted in national cultural values can assist in identifying the generic challenges at a broad cross-national level. However, they may not predict or explain certain risks based on the context of a global engineering project (Scott et al 2011). Relevance of the quote to the management of large projects What Morris’s (2013: p.285) means is that developing large project requires that the needs of people, who should be the beneficiaries of a project, be given consideration, as well as fully engaged in project development and implementation. It could be argued that this people-centred approach provides a paradigm that is crucial for the success of the large projects. This also means that for large projects to be considered as having beneficial social and economic effects, it has to address the society needs. When the people are made to work collaboratively with the project management team, people’s needs are addressed based on their perspective. Indeed, some researchers, such as Oakley (1995) have proposed that development may only be attained when project managers set up projects that people truly want instead of forcing pre-conceived projects on people. This shows the significance of stakeholder management in large projects. Achterkamp and Vos (2008) support this assumption. In their view, effective project management requires that stakeholder interest be taken into perspective. Aaltonen and Kujala (2010) point out that the global projects, or projects that are international in nature, affect many stakeholders, all of who have different demands and interests. They further argue that there has been increase pressure on global projects to be socially and environmentally responsible. The idea of participation is integral in development of large projects within the community. It consists of sharing or working collaboratively to complete projects, although it is also a goal that would provide the people within the community with equal opportunity to play a role in decision-making process regarding projects that will subsequently affect their lives. On the other hand, the idea of participation should not be confused with that of involvement. Mahalingam and Levitt (2007) mentions that it should not just be about involving the people in what the project managers think the community may get involved in, or who should get involved in the project development and implementation. According to Schenck and Louw (1995), people-centeredness approach is an old approach, as it is derived from Roger's person-centred approach. In project management, it is a new concept, as the concept of people-centred development is a new aspect of social welfare and development. Additionally, it is the foundation stone for the sustainable development although it can only succeed when people who are supposed to implement the project use the people-centred approach (Norgaard et al 2009). Williams et al (2010) comment that in governance of projects, large projects are considered sustainable when they integrate stakeholder needs. Essentially, therefore, large projects become sustainable when they address the needs of people, who should be the beneficiaries of a project. To ensure this, people who should be the beneficiaries have to be fully engaged in project development and implementation. This can better be explained by the people-centred concept. The people-centred concept is, as Schenck and Louw (1995) mentions, made up of three components. These include people-centred perception of the development worker, people-centred perception of people, and people-centred perception of development. People's participation in project development and implementation, as a central concern stresses on the idea of human resources development as a significant addition to the capital-centred techniques. Schenck and Louw (1995) comment that one of the issues that triggered the need for people-centred approaches were because of the desire to improve distribution of developmental benefits. Additionally, to develop more effective means of extending development to the lowest-income groups, as well as to reposition development as a concept that concerns people. Oakley (1995) further illustrates that the concept of people participation in projects was intensely emphasised in the 1990s, which strengthened the well-established principle of development that was greatly advocated for by International development Agencies, governments and Non-governmental organisations. In the recent past, however, emphasis on people-centred approaches has happened within the context of increased democratisation of political processes across the globe. Indeed, the political systems that opened up in Africa, Asia, Eastern Europe and Latin America has started to take advantage of the direct involvement of people in the development and political processes (Oakley 1995). Focus on governance and stakeholder engagement Williams et al (2010) comment that in governance of larger projects, stakeholder management is critical. Aaltonen and Kujala (2010) suggest that globally, there is an augmented pressure to enhance environmental and social responsibility when working on large projects. Presently, the concerns of environmental and social activists have to be taken into consideration to ensure project success. Aaltonen and Kujala’s (2010) view that this is specifically so for global or large projects, which tend to implement projects in demanding institutional settings. Mahalingam and Levitt (2007) consider the significance of people-centred approach in large projects as these projects are subject to the effects of the broader social and political environment. According to Morris and Geraldi (2011), processes for governance of project are often criticized for their propensity to treat projects as separate from people participation. The significance of context has been scientifically examined on the fit between organisational structure and the type of project, the leadership styles, tools and processes, as well as extended the criticism by demonstrating that the success of the projects do also depend on certain institutional factors like institutional norms, past experiences, politics, routines and cultural values (Tolbert et al 1996). To this end, the institutional theory comes into perspective (Morris $ Geraldi 2011). The theory explores how organizations acquire, and keep their contextual features. The theory is relevant for explaining the interaction between the project management team’s efforts and context to create organisational learning and best practices. Next, the institutional complexities associated with project management, the complexities of governance, the interaction between organisational structure and context, the leadership roles and lastly political context and portfolio management (Koskela & Howell 2002). The institutional theory places emphasis on the deeper yet more flexible features of social structure by considering the processes through which structures, routines, norms, rules and schemes are integrated into the guiding principles for social behaviour (Amenta & Ramsey 2010). Actual case of people participation in large projects The Kattadam Inc, which is based in Houston United States, offers a good case of the significance of governance and stakeholder engagement, and how people participation, although essential, may sometimes be ignored by the project management team. Its major projects, which are relevant for this review, have been set up in Germany and France (Levitt et al 2003). During the implementation of Kattadam construction projects in Germany, the project management team encountered complexities that affected their readiness to include people in the project. Among the problems included contextual problems related to project governance, such as different cultures, leadership styles, material management, and regulations. Mahalingam and Levitt (2007) identify three main classes of problems that hinder the need for inclusion of people in project development and implementation: Planning phase problems, design phase problems and construction phase problems. When it comes to design phase problems, three problems can be identified. These include delays because of conflicting aesthetic views. For instance, the project management team from the United States contracted to undertake a construction project in France might have conflicting aesthetic views with that of the people in France (Baker & Wiseman 2006). This may lead to time overruns. A project management team that has to work within the set schedule may, under such circumstances, ignore inclusion of people in the project (Remington 2012). This may include the fact that most American high-rise buildings that have glass façades have inoperable windows, and hence, cannot be opened. Instead, air conditioning systems are used for room temperature control. However, in France, the windows in high-rise buildings tend to be “operable.” In fact, this is what Mahalingam and Levitt (2007) attempts to explain in the results of his case study of Kattadam project in Germany. The researchers established that the American architects preferred designing buildings that had inoperable windows. On the other hand, the German project managers feared they would lose their reputation if they constructed an “unattractive” building with inoperable windows. These led to negotiations, which took time leading to project delays. An additional problem that led to project delays is the difference in building codes. For instance, while working in a construction project in France, American architects may want to use different codes that are not consistent with what the people in France are used to. Mahalingam and Levitt (2007) also mentioned this problem in their case study on Kattadam project in Germany. Mahalingam and Levitt (2007) noted that the American architects submitted designs that were inconsistent with the French building codes. In such a case, the French engineers kept sending back the designs. In response, the American architects had to rework on the designs. This led to project delays. Additional problem include the differences in building materials. For instance, architects from other cultures or institutional context may fail to recognise recurrent problems resulting from difference in building materials used. This perspective was proved by Mahalingam and Levitt (2007) in their case study of Kattadam project in Germany. The researchers found that the American engineers tasked with designing the structures did not recognise the availability of particular types of building materials that the people in Europe advocated for. Mahalingam and Levitt (2007) showed that while they had designed a steel structure in Germany, the people in the country were against the idea because of economic and historic reasons, which made steel structures less popular. When it comes to the Construction Phase, two problems can be identified. These include delays because of differences in the contracting practices. For instance, in the design–bid–build contracts, the American architects tended to perform nearly 100% of the design, which makes inclusion of people in project development and implementation tricky. However, the architects in Europe, particularly France, perform some 80% of the whole project design. Later, the local contractors are allowed to complete the design in ways that help their capacity to build the work. In a case study of the Kattadam by Mahalingam and Levitt (2007), the researchers, the American engineers supplied the German local contractors and other stakeholders with nearly fully completed designs in their projects. Mahalingam and Levitt (2007) mention that the local stakeholders in Germany were upset as they failed to finish the designs in ways they perceived to be appropriate. In turn, it led to conflicts. Additionally, differences in regulations also hinder inclusion of people into the project development and implementation (HM Treasury 2011). Mahalingam and Levitt (2007) highlighted several problems that emanate from having different regulations. In their view, the construction practices in the United States require acquisition of particular permits from the local authorities a head of the beginning of a construction project. In European countries, such as Germany and France, several additional permits are required before a construction project is started. In their case study of Kattadam project in Germany, Mahalingam and Levitt (2007) established that the Kattadam projecy was ill-prepared for the existence of regulatory differences between the United States and Germany. Instead, they contracted the local consultants and contractors to assist in identification and to address the local regulatory provisions, as they had no previous experience with European construction practices. In spite of these efforts, the American architects became increasingly frustrated in acquiring project approvals from Germany. Recommendations In Oakley (1995) view, if the people have to be helped to develop themselves, the project development has to focus on the capabilities of people, their resources, knowledge, skills, as well as potential. This is since the community, in reality, perceives their situation better than others do. Hence, they have to take part in assessment of their needs. In which case, excluding the community implies denying them their human dignity and a need to exercise their experience. Basing on this premise, it could also be reasoned that each person in the community should be considered as being potentially a component of the community, and therefore, owns the decision-making rights and sharing in the process of project development and implementation (Walters 2007). In order for the people within a community to develop itself, the community, alongside the project management team, should be made to be responsible for the decisions made or the project. Schenck and Louw (1995) identify such areas as project planning, implementation, and evaluation. Conclusion Morris’s (2013: p.285) means that developing large project requires that the needs of people, who should be the beneficiaries of a project, be given consideration, as well as fully engaged in project development and implementation. It could be argued that this people-centred approach provides a paradigm that is crucial for the success of the large projects. During the implementation of Kattadam construction projects in Germany, the project management team encountered complexities that affected their readiness to include people in the project. Among the problems included contextual problems related to project governance, such as different cultures, leadership styles, material management, and regulations. Large global projects involving high amount of technological and organizational complexity as well as intricate coordination efforts. These kinds of complexities in addition to other factors such as environmental, economic, and political uncertainties often result to confusion between the participants in a project, as well as greater costs and delays. It is such factors that have forced project managers at of large construction projects in to compromise on ensuring people participation, even though they do not have to On the other hand, imbalances and inequalities in accessing social and economic services and resources for development also causes the need for broader political participation, as well as more equitable access to decision-making and resources. These stressed the need for people participation in large project. As established in the analysis, balancing project development and social wellbeing has been a project management challenge for many years. From this, it is established that the idea of involving human aspects in project management is addressed in stakeholder management. In their view, the project stakeholders include the individuals and organizations that take an active role in ensuring the project planning, development and implementation, as well as whose interest is affected by completion and implementation of the project. 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