Uncertainty management of projects from the owners' perspective, with main focus on managing delivered functionality

Abstract

Projects are often claimed not to produce the effects or deliver the functionality that are expected from them. When this claim is mentioned also by the project owner and other central stakeholders, then the project is more likely to be regarded as a failure than a success. For large and complex projects, the uncertainties regarding the functionality that the project should deliver are considerable, and uncertainty management will hence be an essential contributor to determine whether a project is a failure or a success. The project owner will have the power and responsibility for both resources used in the project and effects of functionality delivered from it. The project owner should therefore also play a central part in managing uncertainty influencing the project success.

This thesis is an investigation into how uncertainty management is actually performed in large and complex projects. Since the contribution from stakeholders to uncertainty is often important, the influence of stakeholder management is also important to study. The interaction between project management team and project owner is examined, and their relation to strategic and operational risks in the project is also taken into consideration. The research is made through two case studies – one in the railway infrastructure sector (in public sector) and one in the energy sector (in private sector).

Chapter one presents the scope, aim and motivation for the study – which has also been summarised above.

Chapter two deals with the methodological approach to the study. Key elements are use of combined qualitative/ quantitative studies, two multi-project case studies and a mainly explorative and descriptive approach.

State of the art within relevant areas of this research is discussed in chapter three. Of particular importance here are the topics of goals and success factors, project governance, project ownership and risk and uncertainty management. Particular areas that have a need for more research are also identified.

In chapter four the results from the studies are presented and discussed with respect to each of the research questions. The contribution from each of the six research papers is also shown.

Conclusions and contributions from the studies are presented in chapter five.

The main contributions to practice – or suggestions to changes in current practice are as follows: There is a need for a general change in how uncertainty management is performed. This should likely result in a combination of changes in procedures, organisation, measures for motivation, training etc. This should contribute to establish closer links between project owner and process owner. Needs for changes in risk management frameworks (procedures, defined organisational roles etc.) and needs for well defined measures for motivation and training are identified. The aim of the identification is to improve the balance of interest and power between project owner and project management team with respect to strategic and operational risks. There is a need for training in order to develop necessary basic knowledge regarding risk categorisation, and finally there is also need for procedures/ framework for assigning responsibility for operational and strategic risks to the central actors.

The main contribution of this research to the knowledge development can be summarised as follows: The theoretical understanding on project management and uncertainty/risk management is still insufficient, when it comes to how project owner and project management team influence on determining what is to be focused in uncertainty and risk management. Further more, the study can develop knowledge on the relationship between project owner and process owner in the project owner organisation. The study can also improve the understanding on the owner's role in connection with the functionality that the project is expected to deliver. The study also leads to developing new knowledge on power and interest of the project owner and the project management team with respect to strategic/ operational risks. And finally, based on the study, a categorisation of risk (operational, short- and long-term strategic) is suggested.