Organizational governance to integrate sustainability projects: a case study.
Ghosh, Saumyendu ; Buckler, Lauren ; Skibniewski, Miroslaw J. 等
Introduction
In recent years, enterprises have embraced environmental, social,
and economical values within their constituencies to advance the cause
of sustainability within their organization (Liobikiene, Mandravickaite
2011) and policy makers (Singh et al. 2009). Organizations engaging in
sustainability efforts have gained legitimacy and increased their market
value (Dao et al. 2011). Despite the explosion of interest and concern
regarding sustainable practices, their effective implementation faces
serious obstacles (Petrini, Pozzebon 2009). Since sustainable
development has mutually coherent characteristics: sometimes the concept
of sustainability is not well defined (Berns et al. 2009); often the
concept of sustainability depends on social practices (Smith et al.
2005). Projects and project management are often quoted as important
means of implementing a corporate strategy (Morris, Jamieson 2005) and
therefore the project based industry should be ready to undertake
sustainability related projects. Sustainable development represents a
major governance challenge of the 21st century (Bachus 2005). In order
to implement sustainable projects, major changes to existing processes
and practices will be required (Meadowcroft et al. 2005), and will
require the involvement of societal actors and stakeholders in the
undertaking (Luksa, Siebenhunerb 2007).
One of the most important determinates in a project's success
is the stakeholder environment (Turner, Muller 2005). Sustainability
being a new concept, the business environment of the organization is
continuously changing (Artto et al. 2008).
The literature has not explored whether organizations have enough
resources--assets, competencies and practices (Aral, Weill 2007) to
undertake sustainability projects. A global phenomenon of implementing
sustainability related projects has influenced project-based sectors,
which use a multi-partner project execution model. Many existing studies
report inherent challenges and complexities related to multi-partner
collaboration where interaction is required in multiple-level of the
project organization (Williams 2002; Ghosh, Skibniewski 2010). We
believe that having a good understanding of the resources required to
undertake sustainability projects would enable an organization to gain
an advantageous position in the industry. To address these issues, we
set the project-based sector as our population of interest and seek to
understand how an organization's resource availability is
interrelated with its ability to undertake such projects, and ultimately
be better prepared to tackle one of the most challenging projects of the
century.
Small to Medium Size Construction Organizations (SMSCO) as a group
represent the largest portion of construction industry. Their role
varies according to their specific trade, such as various engineering
and architecture consultants, general contractors, trade
sub-contractors, regulatory local governmental agencies, developers, and
bonding agencies. Within the context of this paper the issues confronted
by SMSCO can be very similar to issues that are faced by other small to
medium size organizations that are involved in the field of
sustainability.
This paper has four main sections; first the background of
sustainability projects and importance of this research is explained,
followed by a consideration of the main research questions that are
addressed. Thereafter, a case study is presented, which investigates
organization readiness by identifying activities completed by the
organization, in order to identify the maturity of the organization
undertaking such projects. Lastly, based on the results of this case
study, a possible project governance structure is proposed and
discussed.
1. Challenges with sustainable projects and impact on SMSCO
Given the scale of the sustainability challenges that an
organization with deep level of understanding of impact of
sustainability on project seeks to confront, we need processes,
resources and skills to be in place, accommodating divergences of
emphasis (Smith, Stirling 2008). Some key characteristics of
sustainability related projects are:
a) Normative: The normative principle in concept is that of
inter--and intra-generational equity. Although this principle as such is
broadly agreed upon, its interpretation varies due to the localized
nature of industry and location specific best practices, i.e. often
consensus is lacking when standards specific to certain business areas,
industries, or countries are derived from this general principle. The
concept of sustainable projects for SMSCOs is in its formative stage,
and not enough guidelines for their management are available. For
government entities, sustainability requirements are being legislated
and those tasked with abiding by these requirements are not always well
educated on the legislative requirements and are even less educated on
the steps that should be taken for meeting these requirements. This
creates confusion regarding project requirements (Zavrl et al. 2009);
b) Subjective in nature, since the same results can be achieved
using multiple business processes and since optimization is not
possible, the interpretation of business needs depends on personal views
or preferences. Business users are bound to differ in their opinion as
to what the important needs are and when these needs are sufficiently
fulfilled. The problem is that the sustainable construction conception
can vary according to the country's size, level of economic
development as well as socio-cultural factors (Saparauskas, Turskis
2006);
c) Complex in nature, indicating that 'everything is connected
to everything' (the solution is a holistic concept and can only be
successful if all the pieces of the solution work together), and
requires the contribution of different actors within the ecosystem. Due
to this complexity, there will always be the issue of diversity in
scientific knowledge, and the fundamental issue of uncertainty as
evidenced by the multiple statutory authorities driving sustainability
criteria (Burinskiene, Rudzkiene 2009; Roggeria et al. 2010);
d) Ambiguous in nature, as it does not contain a clear statement on
the relative priority or weight of the ecological, economic, and
behavioral aspects of deployment. Currently the concept of sustainable
projects is being defined in a number of different ways among SMSCO
members. This lack of clear understanding has created an ambiguity,
further complicating the understanding of the concept (Zavadskas,
Turskis 2008).
While there are a variety of rating systems to quantify the level
of sustainability a project has reached, there is no one size fits all
approach. Unfortunately, the majority of sustainability quantification
is still a result of perceptions based on limited information. In a
highly fragmented project-based setting where multiple stakeholders take
different ownership and perspectives during a sustainability
implementation project (Somers, Nelson 2004), there is a lack of
understanding of sustainability among the stakeholders. In particular,
challenges faced by SMSCOs when dealing with the issue of governance for
sustainable projects include: limited resources, uniqueness of
individual projects, lack of knowledge and understanding of the concept
as whole, lack of clear and definable vision, and unproven benefits. One
strategy to enhance the fit between project ecosystems and governance is
adaptive inclusive and network governance (Galaz et al. 2006), and is
discussed in further detail here. For a detailed discussion on adaptive
co-governance, readers are referred to Kofinas (2009).
Achieving goals of sustainable development requires new models and
indicators of gathering, sharing, and analyzing information;
coordinating work; and educating and training professionals,
policymakers, and the public (Sakalauskas 2010). Due to the complexity
and the enormous amount of relevant information, the decision makers
need to ensure the existence of an effective framework to support
sustainability related projects.
The majority of SMSCO members lack systematic knowledge of
activities (Migdadi 2010) that are required to adapt to this new
phenomenon and, are simply not familiar with it. In order to overcome
this obstacle, SMSCOs need to understand the limits and nature of the
impact of sustainability practices on their project governance spanning
the entire construction life cycle. In addition, they must develop and
maintain the ability to integrate newer technologies into their business
processes. As more and more organizations attempt to integrate
sustainability issues embedded in the construction process, the existing
knowledge gap becomes wider and more apparent.
1.1. Research objectives and approach
Project management is recognized as an organizational capability
(Crawford, Cooke-Davis 2010) and project strategy is directly translated
from the organization's strategy. However sustainability and
projects related to sustainability is an evolving discipline.
Organizations are still trying to build capabilities to deliver such
projects. So far, very limited empirical research has been done to
investigate and relate the normative, subjective, ambiguous and complex
nature of sustainability projects with organizational preparedness and
organizations' ability to deliver such projects. Given the large
body of knowledge on project success and governance, we think that this
is a significant void in the existing literature. The key issues that
remain to be discussed and explored in the academic and users community
are adaptation of the concept of sustainability and institutionalization
of a delivery and execution model of sustainability projects.
Therefore, we focus on organizational resource readiness for
sustainability implementation projects and set SMCOs is the targeted
population of this study, and seek to understand how project governance
practices are supported by organizational readiness by considering an
SMCO organization.
This research intends to improve the organizational readiness of
SMSCO members to cope with the impact of sustainability issues on their
projects by developing a governance framework that they can utilize. In
this research, we propose that project governance practices and the
organizational capacity to manage the multi-party associations in
complex sustainable projects can be integrated through a sustainable
governance process.
1.2. Research questions
In this research we will attempt to answer the following questions:
1. What are the activities completed by SMCOs in order to implement
a sustainability related project?
2. What are the shortcomings and challenges faced by SMSCOs when
attempting to manage a sustainable project?
3. Can organizational readiness manage sustainable projects to be
improved by utilizing a governance framework?
1.3. Managerial relevance statement
In order for sustainability issues to take hold and become accepted
through-out the construction industry, to the level that could
significantly impact the results, there must exist a substantial
understanding of sustainability issues by members of SMSCO. Since as a
group their involvement in sustainability projects happens at the very
early stages its impact will be significant in nature. If a clear
understanding of sustainability issues and processes have not been
defined and accounted for in the early stages of the project
development, the ultimate success of the project would be jeopardized.
This study provides a framework to make better decisions when planning
for sustainability related projects. Given the large body of literature
on the sustainability (from green enterprise perspective) along
political and environmental directions to implement sustainability, we
think that this is a significant void in existing literature to ensure
organizations are prepared to undertake sustainability related project.
The discussion related to shortcomings and challenges when SMSCOs
undertake sustainability in project management and the case study will
address the process part of the integration challenge identified earlier
while the response to resolve those identified challenge will provide us
with an integrated methodology.
Practitioners would benefit from this study by gaining valuable
insight regarding the resources and processes required, which will
enable them to appreciate and improve their organizational readiness.
The paper presented practical implications for SMSCO's strategic
management--it necessitates the need to rethink governance in terms of
the new dimensions, evaluate existing governance and management
approaches, understand projects as existing in an eco-system and rebuild
organizational resources based on these new principles utilizing the new
found relationships and dependencies.
2. Background and literature review
Sustainability, while now embedded within the legislation and
development policy in some countries, is often implemented within the
design and construction process only. However the tools developed have
rarely considered sustainability in its entirety, instead, they have
concentrated on the more quantifiable aspects of the environment,
ecology, and building material use (Willetts et al. 2010a, b). Due to
different contextual elements being present in the decision making
process, the majority of projects related to sustainability currently
undertaken by SMSCOs suffer from being underprepared (Smith et al.
2005). In particular, the impact of the following items on environmental
and economic sustainability are evaluated in more detail: Leadership in
Energy and Environmental Design (LEED) required documentation,
sustainable design guidelines, building systems, and cost. LEED is not
the only sustainability certificate or way to assess sustainability but
used reference for the current study. The ability to govern and
integrate the above mentioned items with other tasks associated with the
entire construction lifecycle is key to successful management of
sustainable projects. Negahban et al. (2012) states that SMSCOs
represent a large segment of construction industry, and an increase in
the efficiency of their operations will have an impact on the overall
efficiency of the entire construction industry.
Governance consists of resources, organization, management,
polices, and framework (Patel, Robinson 2010). A multi-level governance
system often emerges to deal with non-cohesive stakeholders and can help
develop a partnership between all stakeholders by separating
responsibilities at different levels where appropriate. It combines the
dynamic learning characteristic of adaptive management with the linkage
characteristic of collaborative management (Folke et al. 2005). The
distinction in complexity, uncertainty, and ambiguity of the stakeholder
environment can serve as a guide for selecting the right models of
inclusive governance (Renn 2008).
2.1. Characteristics of sustainability related projects
2.1.1. Triple bottom line--applied to existing SMSCO
The World Commission for Environment and Development (WCED) first
popularized the idea of sustainable development in 1987, and defined it
to be the development that met the needs of the present generation
without compromising the ability of future generations to meet their
needs. Elkington (1997) developed the concept of Triple Bottom Line
which indicated that "companies and or organizations create value
along multiple dimensions". The concept of Triple Bottom Line (TBL)
deals with sustainable development/framework that attempts to find a
balance among the need for social equity, economic growth, and
environmental protection. A sustainable business that aspires to meet
the TBL and business model that is generated to account for
sustainability, must consider economic profitability, environmental
soundness, and social responsibility (Elliot 2011). The Boston
Consulting Group's recent survey (Berns et al. 2009) of over 1500
business executives in collaboration with MIT Sloan Management Review
concludes that "research indicates that companies need to develop a
better understanding of the implications of sustainability for their
business and that the companies already doing so are seeing significant
benefits".
2.1.2. Integration and change management
As indicated by von Rosing et al. (2010), the efficient execution
of sustainability processes is largely dependent on available systems.
They also conclude that the sustainability framework should integrate
various aspects of the organization, resources, and processes. As
indicated previously, most SMSCO members lack the governance pertaining
to the implementation and integration of IT systems within their
organization (Negahban et al. 2012).
2.2. The resource based theory of an organization
The resource based theory argues that durable competitive advantage
emerges from the unique combination of resources and resource
availability as well as the ability to deploy such resources, which
would improve performance (Grant 1996). Adopting the resource based
theory perspective and applying it to information technology also makes
it clear that the organization should possess assets, competencies, and
practices to ensure that the organization is uniquely positioned to
undertake new challenges. Asset resources are classified into four
sub-categories: infrastructure, transactional, informational and
strategic (Weill, Ross 2004). Competencies are classified as skills and
management quality; practices are classified as culture, communication
and complementarily with other existing process.
3. Research approach and methodology
Hall and Day (1977) consider three uses of models: understanding,
assessing, and optimizing. In this paper, an understanding model is
developed and assessed using information gathered by reviewing and
analyzing project documents. The framework for this is built around
extending the notion of organizational readiness and ability of
organizations to undertake a sustainability project. The article focuses
on the macro aspect of the project and organizational ecosystem within
which the project resides, and not on the micro aspect of project
management principles. To understand organizational readiness, we
consider two dimensions of sensitiveness--knowledge sensitivity and time
sensitivity (Skibniewski, Ghosh 2009).
In analyzing organizational readiness, we intend to analyze the
knowledge and time dimensions of information specificity to understand
how organizational resources, skills, and processes are available.
Acquisition and use of information are the two key elements of the
information processing system. In Table 1, we present the relationship
between the time and knowledge specificity of information, and the
specificity of acquisition and use of information to understand the
level of preparedness of the organization.
3.1. Research methodology
Case study is a methodology when a holistic, in-depth investigation
is needed (Feagin et al. 1991). Hall and Day (1977) consider three uses
of models: understanding, assessing, and optimizing. In this paper, an
understanding model is developed which is assessed using information
gathered from reviewing project documents and based on the analysis
performed on those. This conceptual framework of this is built around by
extending the notion of project ecology (Grabher 2004; Ghosh,
Skibniewski 2010).
The case study was conducted based on semi-structured interviews
with relevant stakeholders --project manager, business owners, and
solution integrators of an SMSCO firm based out of Maryland, USA. We
reviewed internal documents related to research for the case study,
conducted thorough interviews with the sustainability coordinator in
conjunction with review of the Sustainability Integration Plan. The
Sustainability Integration plan formed the basis of the firm's
initial strategy for responding to the sustainable needs of its current
clients as well as expanding their client or service base. The
Sustainability Coordinator created the Sustainability Integration Plan
after detailed discussion with all levels of the organization. The
interviews and reviewed documents address a wide range of topics
including evaluation of the organization's structure
(organizational and relationship), strategy (long term and short term),
maturity (skills, process and leadership), and resource (both human and
infrastructure) situation that may impact success of the project. The
interviews also provide details regarding implementation readiness,
organizational governance practices, and institutional leadership and
relationship between different stakeholder entities. Results were
validated using triangulation method.
4. Case Study
4.1. Background
The case study is based on a multi-disciplined consulting firm
providing transportation, structures, construction, environmental,
facilities engineering, and technology services. The firm is
headquartered in Maryland, with offices throughout in the eastern United
States. The company has experienced significant growth in its forty year
history, moving up in the Engineers New Record (ENR) rank by 350
positions in 15 years between 1996 and 2011(ENR.com 2011). Like most
SMSCOs, this firm has experienced challenges with the integration of
sustainability concepts, but has managed to overcome these obstacles
with the governance of a Sustainability Coordinator, Sustainability
Integration Plan, and Sustainability Committee.
This firm represents SMSCO because of its size (both physical and
financial) and the role that it plays within its sector. The case study
is relevant because it represents a full cycle of dealing with
governance and sustainability within the organization. It documents the
process from its very early stages to its current semi developed form.
It also identifies some of the issues that were faced by the
organization, and how they had to deal with it.
4.2. Organizational readiness to govern sustainability projects
The company created and implemented a governance framework
consisting of the Sustainability Committee in conjunction with the Board
of Directors acting as the governance board and the Sustainability
Coordinator acting as the program management office (Fig. 1).
The Sustainability Committee is a multi-disciplined group of senior
staff. The group consists of the Chief Marketing Officer, Chief
Information Officer, a Vice President (VP) of Facilities, the VP of
Natural Environment, the Sustainability Coordinator, and additional
senior staff. The group functions outside of their traditional technical
roles to view the entire range of sustainability issues and its impact
on the firm. The Committee meets monthly to act as a clearing house for
sustainability integration and a platform for information sharing.
Discussions include the expansion of knowledge through seminars,
strategic teaming arrangements, and research assignments.
The Sustainability Coordinator handles the day to day
responsibilities relating to sustainability, bringing any major issues
to the Sustainability Committee for discussion. The coordinator works as
a liaison between the Sustainability Committee and the general office,
interacting as necessary with the technical divisions, regional offices,
and support divisions of the firm. The coordinator's role is a part
time portion of the technical staff member's responsibilities.
Currently, knowledge and time sensitive and project specific issues
are handled first by the Sustainability Coordinator and then elevated up
to the Sustainability Committee should it become necessary for approval.
Current sustainability responsibilities as assigned within the
governance frame work related to sustainability are listed in Table 2.
[FIGURE 1 OMITTED]
The Sustainability Operations Committee consists of a group of
volunteer employees with an interest in implementing sustainable
practices and operations. The group compiled a list of internal
operations changes, ranked these changes in terms of importance, and has
been working through the list to implement the suggestions. For example,
they adopted a highway for cleanup and organized employee cleanup
efforts during lunch breaks several times a year.
The Water/Wastewater (W/WW) department is an example of a technical
division. As they pursue or work on a project focused on their technical
specialty, they conduct the bulk of the technical work, but work closely
with the Sustainability Coordinator if there is a request to incorporate
sustainability into the project.
4.3. Sustainability organization readiness timeline
The sustainability governance development timeline, shown in Figure
2, provides a view of the integration process. The timeline is longer
than the firm originally expected, but this particular integration was
for an existing mid-sized company across multiple divisions and in
multiple states. It is notable that sustainable activities were
occurring before this timeline and during the beginning of this
timeline, but without formal coordination or labeling.
The process began from the bottom up, which caused some of the time
delay. Approximately halfway through the 4 year timeline, the process
gained strong support from the top level of the organization, thus
allowing the governance component, the Sustainability Committee, and the
Sustainability Integration Plan to develop at a faster rate.
The Resource Dedication listed in the timeline is the percentage of
the Sustainability Coordinator's time which is devoted solely to
sustainability. The remainder of the coordinator's time is devoted
to the technical responsibilities the staff member is also assigned.
The first attempt for the Sustainability Committee led to lengthy
discussions on the definition of Sustainability and the coordination of
the Triple Bottom Line (Environmental, Social, and Economic). The debate
focused on the strength of the Environmental leg and the Economic leg;
the balance between these 3 factors is a continued focus of the
Sustainability Committee. Creating the right balance amongst committee
members delayed the committee finalization.
[FIGURE 2 OMITTED]
4.4. Specificity of information acquisition
4.4.1. Time specificity
Activities that require immediate understanding are handled by the
Sustainability Coordinator. The role of the Sustainability Coordinator
began with a part time response to these immediate, time sensitive
needs. The Coordinator assists the various divisions within the firm to
determine the issue, solution, or integration as necessary. This role
requires a broad understanding of sustainability, the SMSCO's
capabilities, and the project or client of impact.
For an SMSCO, the Sustainability Coordinator role will begin as a
small portion of a staff member's responsibilities, preferably a
staff member with additional technical skills in order to justify the
position for a small company. For this company, it was four years before
the sustainability position reached 50% of a full time staff
member's time. The position grew with the company, as the company
almost doubled in size during this time.
As the Sustainability Coordinator role grows, the ability to
respond to time specific integration demands will increase. Currently,
the majority of time specific issues are addressed. The dual function of
a staff member allows a SMSCO to provide time specific sustainability
integration.
4.4.2. Knowledge specificity
The company developed a Sustainability Integration Plan (SIP),
which provides an overview of the current status of the company and
recommendations for the future integration of sustainability within the
company, as well as expansion opportunities for the company with respect
to sustainability projects. The document was developed from the LEED
Policy Plan, created to assist the SMSCO with its growing costs
associated with LEED accreditation, certification, and membership. The
first step of the SIP was a mapping of all areas of sustainability
against the current experience of the company, which required
discussions with the market and discipline leaders within the firm. This
mapping has been used to monitor sustainability experience and although
it is still maintained manually, the company is working to track this
information through the existing marketing database with ties into the
proposal and project SharePoint based electronic workspaces.
An enterprise management system (EMS), which is a SharePoint based
project site, was developed for sustainability projects and is
accessible to all employees. The site contains the SIP, the LEED Policy
Plan, and additional relevant references. Currently, the site is acting
as a repository for reference information which is mainly utilized by
the Sustainability Coordinator. The Sustainability Committee was
developed as a cross company initiative to maintain the SIP and assist
with knowledge dissemination.
4.5. Specificity of information usage
4.5.1. Time specificity
For time specific information, staff will contact the
Sustainability Coordinator. The same issues that arise in specificity of
acquisition also apply to the specificity of use. Although the EMS is
being strengthened through coordination of the project lifecycle with
links to the sustainability information, it is anticipated that time
sensitive information will still be drawn from the Sustainability
Coordinator.
4.5.2. Knowledge specificity
Once the SIP was developed, two members of the Sustainability
Committee conducted a regional office tour educating those interested,
with a condensed version of the plan. The SIP was also presented to the
board and the managers of each office. In the future, a sustainability
liaison will be assigned from each branch office to coordinate with the
Sustainability Committee to allow for a flow of information in both
directions.
Additional in house training has been discussed, but no formal
training has been developed or provided yet. As the needs grow, there
will be opportunities to provide specific training.
5. Analysis
The company's maturity in supporting sustainability projects
and current gaps in the capabilities in supporting sustainable projects
are discussed as follows (Table 3).
5.1. Assets
Infrastructure assets are expected to provide a foundation for all
activities related to the support of sustainability projects. The
infrastructure support is expected to provide a framework to execute
coordination and assimilation of new knowledge on a SharePoint based
site.
Collaterals are stored in the SharePoint system allowing for simple
retrieval. The collaterals only provided explicit knowledge and there
were no attempts made to document tacit knowledge, to the extent
possible, in an effort to make it explicit. Although there are subject
matter experts within other technical roles, there is currently limited
backup sustainability generalist support available. Identification of
the appropriate subject matter experts could be improved through
improvements to the automation systems.
From a transactional point of view of the company's business
processes, there are limited automated processes to support
sustainability projects. Advertisements for new work are flagged as
sustainable steps and reviewed and approved by the Sustainability
Committee through the EMS. The firm has not fully invested in any
operations system and manual support is provided to all sustainability
related issues.
The company is utilizing a governance board (as discussed in Figure
1) to align strategic objectives with project objectives. There was no
internal change management initiative to ensure that the business
process was changed to use new opportunities. The company often does
strategic teaming with other parties to acquire strategic advantages.
Although very rarely, consultants are used, however there are very
limited resources who can consult on sustainability related issues.
Senior management commitment was restricted to assign part-time
sustainability coordinator and casual sustainability board without any
full time resources allocated. Governance framework was expected provide
responsibility assignments and definition of roles and responsibilities
within the organization.
To coordinate information gathering and dissemination, the firm
used the train the trainer approach, where typically the Sustainability
Coordinator was the only one attending outside training. There was no
data-mining, research, or planning exercise conducted. Additional staff
requests to attend sustainability related training are reviewed by the
Sustainability Committee. These requests are advocated if they align
with the company's goals and then approved through the
company's traditional educational approval process.
5.2. Competencies
There are two independent aspects of skills: training and impact
awareness, and champions.
The company has provided extensive availability of collaterals on
the corporate website with minimal onsite, instructor-led training
courses available for associates. Therefore, staff must show initiative
to seek training opportunities that will benefit and improve upon their
technical role. The workforce has been developed in conjunction with the
work requests received. The company's organizational maturity to
undertake sustainability related projects was driven by a few champion
associates.
The level of skilled management assigned to the governance of
sustainability projects was limited. This key initiative was managed by
a mid-level associate without any directs assigned to this initiative.
While executive management was steering the initiative, this task
remained as an additional responsibility, losing strategic focus and
lacking in tactical direction, which impeded timely and efficient
execution. The company has delayed in assigning resources to this
strategic initiative from other non-headquarters location until there is
a true need for this role.
5.3. Organizational practices and structure
The company is resource constrained, with roles and
responsibilities having a many-to-many relationship as are obvious from
Figure 1. This leads to multiple resources doing the same work, and
this, coupled with non-standard business practices, leads to
non-streamlined resource allocation.
The company is an organization with mature business practices and
well defined process flows. These practices and processes have been
utilized by organizational resources for an extended period of time.
Sustainability project execution requires changes in the existing
business processes. Additional environmental scanning is necessary to
understand changes in the ecosystem, requiring an adaptive governance
process, which does not exist in the company. This has delayed the
adoption of new processes and thereby extended the execution cycle. No
finalized return on investment analysis was conducted. The company began
tracking all sustainable opportunities once the Sustainability Committee
was finalized. All missed opportunities are tracked through the EMS with
an associated fee amount and a reason for the missed opportunity listed.
Integration remained a challenging task due to a lack of
cross-functional teams and a non-inclusive business process. Current
team structures are focused on discipline departments. Some divisions
within the company have required stronger cross functionality in the
past and these areas have more readily adjusted to sustainability
cross-discipline work. There was no framework available to govern
sustainability within this industry when this company created the
governance structure presented here.
6. Discussion
We hypothesized that to undertake a sustainable project;
collectively binding decisions cannot always be imposed hierarchically.
These projects systematically involve project actors in policy
formulation and implementation. From a tactical perspective, it appears
that the same responsibility was assigned to multiple groups of
resources, and the same groups of resources were assigned multiple
responsibilities. This resource misalignment contributed to the under
preparedness of the company and to the lack of proper utilization of
resources, resulting in increased need of communication of streamlined
business processes within the organization. Also, a single resource
driven control (e.g. Sustainability Coordinator) leaves corporate
governance in the hands of one individual. While the Sustainability
Coordinator is the champion, there is no second layer of sustainability
generalist subject matter expertise developed in the organization,
creating a single point of failure. The company has recognized the
potential of sustainability projects and has worked within its means to
create a governance structure to host such projects. The case study
showed that the company's organizational strategy to undertake
sustainability projects has not fully developed to the recommended
levels of corporate project governance strategy and ecosystem.
The current organization structure lacks the following:
1. Presence of governance at different levels of organizations with
some responsibility assigned at different levels.
2. Resource assignment to address contextual business process
changes (e.g. changes in the legislation or rating systems) and ability
to meet such requirements, so that the organizational readiness is
scalable to adapt to the changing ecosystem.
3. Dedicated and exclusive resource, meaning that all the actors
from the entire ecosystem have equal responsibility to ensure that the
solution is sustainable (the ownership within the organization was based
on additional responsibilities and no resources assigned exclusively to
sustainability related work, which resulted in no individual staff
member owning the full life cycle of the solution).
We propose that an inclusive multi-level framework (Fig. 3) aligned
with these challenges and governance of new areas should be inclusive of
the corporate strategy framework for two distinct reasons. First, it can
generate conciseness about the surroundings, and have the ability to
adopt existing corporate strengths and resources in strategy. Second,
the proposed framework or 'new institutionalism' can generate
awareness about the project. A product or service produced in collective
action is likely to have better chances to ensure sustainability since
it introduces a pre-emptive dimension in the approach (Ghosh et al.
2011; Kooper et al. 2011). Thirdly, this framework includes strategic
adaptation activities that focuses on inter-relationship between social,
economic and ecological layers.
6.1. Proposed framework--possible approaches to resolve the
challenge
Our conceptual framework identifies an organizational structure
that has the ultimate decision authority and must approve major
strategic decisions and significant changes related to the project. It
must also make fundamental up-front decisions about how the program will
be structured. The proposed framework is organization wide, functions
are bundled, and the levels of governance are multiple, but limited.
The Institutionalized Project Governance Board (IPG) is the highest
level body in the organization responsible for strategic direction
setting. The IPG is responsible for strategic direction setting of the
organization based on the scale diversity in projects to be executed and
aligning it with organizational capacity and objectives. The IPG will
also recognize diversity and dynamics within the scope of the project
before making a decision. The IPG consists of senior executives from
each of line of business, including executives from financial,
information technology, and operations management.
The Program management office (PMO) consists of the following
members: technical, business, and operational leadership, as well as the
sustainability co-coordinator and the designated project manager for the
specific project. The PMO should focus on overlooking at the sales and
execution cycles of projects, and act as a liaison between all projects,
including providing knowledge movement support between projects. The PMO
will also perform organizational resource allocation, cost benefit
analysis of the project, and will be ultimately responsible to ensure
that the triple constraints of projects is satisfied, which ensures
project management opulence. The PMO will also be responsible for
knowledge management and ensure that knowledge flow across multiple
entities within the organization is taking place.
[FIGURE 3 OMITTED]
Table 4 aligns the current responsibilities within the company with
the proposed governance framework. It identifies which group of
individuals can be responsible for what tasks. Due to the multi-level
governance structure, all levels of governance can be managed by
part-time resources, and each of the levels of governance can be staffed
by key resources from all impacted business units. Therefore, horizontal
communication within a layer of governance will be focused on certain
responsibilities and easy to manage. This being a multi-layer scalable
model, with increasing business, the company can augment additional
staff at each of the layers to ensure that the business volume is
satisfied in a timely manner.
6.2. Research synthesis
We have provided an organizational governance framework to
undertake sustainability projects since project governance by itself is
inadequate to overcome all the challenges faced by the project
organization for resource constrained entities like SMSCOs.
The study highlights the following interacting aspects in
formulating an organizational governance framework to ensure proper
usage of resources:
a) Our framework allows members of SMSCOs, who often cannot afford
to have setup project governance for each project, to have an
institutionalized organizational governance framework to govern all the
projects undertaken;
b) Sustainability projects being normative, ambiguous, and complex
in nature, organizations should be prepared to address different types
of situations at different levels of communication. Simple existence of
any project specific management structure or a corporate knowledge
management framework would not overcome this challenge;
c) Responsibilities are well defined and the number of layers
within the framework is minimal, reducing the time required to ensure
communication. In addition, the proposed framework would ensure that
only two parties own the communication;
d) The article has established the need to feed project based tacit
knowledge into an inclusive framework to ensure that in a resource
constrained environment, shared multi-tasking responsibilities can be
provided and risk can be reduced;
e) The framework allows for the ability to support a flexible, but
well defined structure that is scalable from resource, competencies, and
process perspectives while working under triple constraints.
6.3. Benefits
The major distinction in the proposed framework is that provides a
structured approach motivated by project governance principals to
integrate organizational resources that is relevant to undertake such
projects. The framework distinguishes itself from neither a governance
nor management process by inclusion of organizational readiness as
formal part of the framework.
This is the first time a framework is presented that integrates
with principals of organizational resources, integration with available
tools and techniques and therefore organizations can strategically
establish itself to meet the needs to the latest trends in political,
corporate and environmental demands.
The second major premise concerns the inclusiveness of the
governance process, which is seen as a necessary, although not
sufficient, prerequisite for tackling critical success factors in both a
sustainable and acceptable manner and, consequently, imposes an
obligation to ensure the early and meaningful involvement of all
stakeholders (Renn 2005). The proposed framework provides an inclusive
framework.
A third major premise involving simplifying the framework and
institutionalize resource governance as part of the project governance
framework instead of part of project management process at the project
level.
6.4. Limitations
Although this research provides exposure to the current state of
readiness for SMSCOs from a resource based perspective, it has some
limitations. First, these findings are based on a case study, and
therefore, is limited to findings from one specific organization.
Second, our information gathering was done using semi-structured
interviews using qualitative responses. No quantitative study was
conducted. Third, the findings are biased by the interviewee's
response is to the situation. And finally, a key employee of the case
study firm is also an author of this article.
This work is considered to be in the early stages of development.
The sustainability field is very young, impacts are still being
developed and not fully and clearly understood and therefore cannot be
measured. Therefore at this time it is hard to have a discussion about
new work until economic impact is completely understood. However we do
expect that this paper does contribute to the body of knowledge
understanding how firms (and probably the most critical segment of the
industry) are prepared to undertake the most critical efforts of the
century. We except to stir enough research interests that can be pursued
by other researchers or by us during subsequent studies to understand
the economic impact.
7. Future research
Understanding and acceptance of new tools, techniques and business
process is one of the most mature streams of organizational resource
research, but under-researched in project governance area. There have
been several theoretical models, primarily developed from theories in
psychology and sociology, employed to explain technology acceptance and
use. Current project governance literature is dominated by understanding
single project paradigm without considering various environmental
factors. As a result, organizational, social and historical influences
on project success are often under emphasized from explaining project
management process and techniques. This is the first attempt to align
organizational resource availabilities to undertake sustainability
related projects from a governance perspective in order to improve
project governance process and framework. The effectiveness and value of
governance depends on the active participation of each stakeholder in a
structured format. We propose a framework with an equal emphasis on
resources and process, which helps provide the answers to this challenge
and helps management identify the facilitating and inhibiting factors
that influence project success.
Conclusion
This research was an attempt to provide evidence that
sustainability, which will dominate business in the next generation,
requires further analysis to improve our understanding of how
organizations can execute sustainability projects with greater success
and fully harness the capabilities of the organizational ecosystem.
For future research, the study should be validated using a
quantitative study. In addition, the proposed framework should be
implemented in a number of other SMSCOs and their results analyzed.
Although no explicit statement is being made, the study assumes
that good organizational readiness and governance would ensure good
project performance. In the cases of addressing organizational level
performance, researchers would benefit from employing hierarchical or
longitudinal analysis that would allow them to capture the influence of
organizational resources on higher level project outcomes over time.
The current article aims to apply the empirical findings related to
project governance to organizational readiness for undertaking
sustainability related projects. The theoretical starting point of this
research is a multidisciplinary perspective using recent insights of
organizational resource theory, project governance, and multi-level
governance theory. This article highlights the governance and steering
of institutional readiness as well as the governance and steering of
organizational resources to undertake one of the most challenging
projects of the century.
The article also extends the institutional analysis of resources to
an organizational governance framework. Finally, a multi-level
governance framework was presented. In the article, there is a specific
emphasis on the dynamics of the project ecosystem, and the resources,
skills, and practices required to support sustainability related
projects.
Caption: Fig. 1. Project governance structure
Caption: Fig. 2. Sustainable governance development timeline
Caption: Fig. 3. Multi-layer proposed governance structure
doi:10.3846/20294913.2014.850755
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Saumyendu GHOSH (a), Lauren BUCKLER (b), Miroslaw J. SKIBNIEWSKI
(a, c), Sam NEGAHBAN (a, d), Young Hoon KWAK (e)
(a) Department of Civil & Environmental Engineering, University
of Maryland, University College, USA
(b) The Office of Energy Performance & Conservation, Department
of General Services, State of Maryland, MD, USA
(c) Academy of Sciences Institute of Theoretical and Applied
Informatics, Gliwice, Poland
(d) Brawner Builders, MD, USA
(e) George Washington University, Business School, Washington DC,
USA
Corresponding author Saumyendu Ghosh
E-mail: sghosh12@umd.edu; saumyendu@faculty.umuc.edu
Saumyendu GHOSH received Master's degrees in Statistics from
the Indian Statistical Institute, Calcutta, India and in Engineering,
and PhD (Project Management) from the University of Maryland, College
Park, USA. He has held a number of ERP and CRM Project Director
positions in the Commercial Sector and has implemented enterprise-wide
applications in 22 different countries in the world. He also teaches
Global Project Management and Project Governance at the University of
Maryland--University College, USA, School of Business, George Washington
University, Washington DC, USA and Penn State--York Campus, PA, USA as
an adjunct faculty. His primary research interests include project
governance and sustainability for large and enterprise application
complex projects. He is a senior member of IEEE and governor of IEEE
Engineering Management Society in 2007. His research interests include
project governance for complex enterprise transforming IT projects.
Lauren BUCKLER, P.E., CEM, LEED AP is the Director of the Office of
Energy Performance & Conservation for Maryland's Department of
General Services. She began her career providing construction management
services for education and retail clients including LEED facilities, and
then moved into the design field focusing on energy efficient mechanical
systems. Prior to joining the State, she consulted on energy &
sustainability initiatives for government clients and internal company
operations. She is a licensed mechanical engineer, certified energy
manager and leadership in Energy and Environmental Design accredited
professional. Her experience includes design, construction, &
program management for a variety of facility types.
Mirostaw J. SKIBNIEWSKI is a Professor of Construction Engineering
at the Center of Excellence in Project Management in the A. J. Clark
School of Engineering the at the University of Maryland, College Park
(USA). He holds his Master of Eng. in Civil Engineering from Warsaw
University of Technology (Poland) and MSc and PhD degrees from
Carnegie-Mellon University, Pittsburgh, Pennsylvania (USA). He is an
author or co-author of over 240 publications on a broad range of topics
related to engineering project management, information technology and
automation engineering applied in construction and other project-based
industries. He is a recipient of numerous U.S. and international
research awards, including an honorary doctorate from Vilnius Gediminas
Technical University (Lithuania).
Sam NEGAHBAN has twenty nine years of project management, business
development, project engineering, and business ownership experience.
Currently he is managing Brawner Builders Inc.'s facilities
renovation programs for Federal, State, and local agencies. He has
successfully developed a program to allow Brawner Builders, Inc. to
compete and be awarded multiple Task Order, IDIQ, On-Call, Time &
Material, Design Build Contracts. In addition, he has developed and
managed a team that is currently competing successfully in public and
private sector construction contracting. Other demonstrated abilities
include strategic planning, scheduling, estimating, bidding, contract
negotiations, and consistent building excellence as shown by client
satisfaction and consistent successful engagements. Over the last twenty
years, he has developed an expertise for completing projects for
Universities and local school districts under severe budgetary and time
constraints. These projects have consisted of renovations to:
dormitories, lecture halls, class rooms, theaters, sport facilities,
laboratories, and offices.
Young Hoon KWAK is an Associate Professor at the Department of
Decision Sciences at the George Washington University School of Business
in Washington, D.C. He earned his MSc and PhD in Engineering and Project
Management as well as Management of Technology (MOT) Certificate, all
from the University of California at Berkeley. He currently holds a
Guest Research Professor position at the Faculty of Economics and
Business Administration at Ghent University in Belgium. He serves as a
Specialty Editor (Associate Editor) for the case studies section of the
Journal of Construction Engineering and Management (ASCE) and an
Associate Editor for Journal of Management in Engineering and serves on
the editorial board for a number of other journals. His primary research
interests include project management and control, project performance
evaluation and improvement, management of technology, and engineering,
construction, and infrastructure project management.
Table 1. The specificity of information
Time Specificity Knowledge Specificity
Specificity of Acquisition
Integration must be initiated Knowledge specific information
immediately or shortly after the could be of three types:
request originates. Since time is information collected in a
of essence here, automation is planned way, information mining
preferred. However, information to address a potential situation,
can be resourced manually, and proactively understand
provided, a system exists to changing ecosystem dynamics.
understand whom the requester Integration of knowledge
should go to. specificity is related to
creating a knowledge memory
model.
Specificity of Use
Since these requests are for Information is used to build more
immediate use, requests can explicit knowledge to support and
originate during the sales cycle build a knowledge memory
or the execution cycle, which foundation.
might have an impact on an
immediate deliverable. Support of
sales cycle and implementation
cycles would necessitate separate
knowledge requirements.
Table 2. Sustainability responsibilities
Responsibility Description
1) New Work Responding to requests for proposal (RFPs)
focused on sustainability. Example: Proposals
for Climate Change work require input from
disciplines but would be led by sustainability
coordinator.
2) Acquisitions Researching areas for acquisition to strengthen
sustainable service offerings including
individual hires or company acquisitions.
Example: Researching competing firms for staff
qualifications in energy, green roofs, and
complete streets in order to require these
credentials for strategic hires.
3) Research Researching new sustainable design techniques
or rating concepts, e.g. managing LEED version
changes and credentialing maintenance
requirements.
4) Trouble-shooting Assisting internal staff and clients with
resolutions to sustainability related problems,
e.g. Coordinating with the USGBC to apply LEED
for campuses before the rating system has been
released for official use.
5) Design/ Design of sustainable projects or sustainable
Technical Work components of projects, e.g. conducting
greenhouse gas calculations, analysis, and
reduction planning.
6) Training/ Training of existing staff through internal
Hiring workshops, one-on-one discussions, and review
of requests for external training in
sustainability. Example: Providing question and
answer sessions of the Sustainability
Integration Plan to all regional offices.
7) BIM Coordination Coordination between BIM systems and
sustainability design practices. Example:
Working with the CAD manager to assess
preassembled BIM LEED System platforms for
purchase.
8) Integration Incorporation of sustainability tracking into
into Project their Ad Tracker, Proposal Center, and Project
Delivery System Center platforms. Example: Meeting with
marketing staff to provide examples of
sustainable projects to allow projects to be
sorted when they enter the project life cycle
system.
9) Sustainable Modifications to internal company operations to
Internal Operations increase sustainability. Example: Coordinating
highway and stream cleanups with staff
volunteers.
10) Economic Tracking and evaluation of revenue attributed
Impacts to sustainable projects. Example: Determining
the portion of a LEED design project that is
dedicated sustainability revenue versus
traditional discipline design revenue.
Table 3. Sustainability responsibilities--maturity and benefits
Current
Type of Asset maturity Potential resources
Infrastructure Medium Knowledge is acquired through seminars,
conferences, and independent research.
Transactional Medium Review is provided by the Sustainability
Coordinator and sometimes final review by
the Sustainability Committee. New
projects are entered into the EMS system
for approval.
Informational Low An Intranet site providing informational
resources is available to all employees.
Strategic Medium A report is presented to the Board of
Directors by the Sustainability
Coordinator.
Type of Asset Expected benefits
Infrastructure Provides a foundation for the knowledge base, which
would enable the organization to undertake new
projects.
Transactional Automation and systemic would make the organization
efficient and able to respond quickly. Some
processes are automated; the company is working to
automate more.
Informational Provides an ability to understand ecosystem changes
and therefore can set strategic direction.
Strategic Supports new market strategies, ensures resources
are up to date with ecosystem changes.
Table 4. Assignment of responsibilities within new governance
structure
Responsibility Description Current level
1) New Work Responding to requests Sustainability
for proposal (RFPs) committee
focused on Sustainability
sustainability coordinator
2) Acquisitions Researching areas for Sustainability
acquisition to committee
strengthen sustainable
service offerings
including individual
hires or company
acquisitions
3) Research Researching new Sustainability
sustainable design coordinator
techniques or rating
concepts.
4) Trouble-shooting Assisting internal Sustainability
staff and clients with coordinator Technical
resolutions to Division Regional
sustainability Office Support
related problems Functions
5) Design/Technical Design of sustainable Sustainability
Work projects or coordinator Regional
sustainable components office
of projects
6) Training/Hiring Training of existing Sustainability
staff through internal coordinator
workshops, one-on-one
discussions and review
of requests for
external
sustainability
training
7) BIM Coordination Coordination between Support function
BIM systems and
sustainability design
practices
8) Integration into Incorporation of Sustainability
Project Delivery sustainability committee
System tracking into Ad Sustainability
Tracker, Proposal coordinator
Center, and Project Sustainability
Center platforms Operations committee
9) Sustainable Modifications to Sustainability
Internal internal company coordinator
Operations operations to increase
sustainability
10) Economic Tracking and
Impacts evaluation of revenue
attributed to
sustainable projects
Responsibility Assignment in the new structure
1) New Work PMO--to respond to RFP IPG--to approve RFP
before going out
2) Acquisitions KS--this is a continuous knowledge management
activity
3) Research KS--this stream will formulate knowledge
management approaches for the organization
4) Trouble-shooting KS and TS--this is a joint activity between
business and technical members of the staff
5) Design/Technical KS--this will be led by the subject matter
Work experts (SME)
6) Training/Hiring KS--this will be led by training experts with
support from the SMEs
7) BIM Coordination TS--while integration of design with feeder
systems will be led by the KS team, real time
coordination will be managed by the TS team
8) Integration into PMO--this is the tactical relationship between
Project Delivery independent project groups
System
9) Sustainable PMO--will be responsible for overseeing and
Internal ensuring all documents, operations, and
Operations transactions are codified as per corporate,
industry and legislative standards as
applicable
10) Economic IPG--will ensure that the volume of projects
Impacts and the expected margin from the projects meet
corporate objectives; also ensures that
additional resource allocation takes place to
support and meet business objectives
Abbreviations used: PMO--Project management office,
K(T)S--Knowledge(Time) sensitive information response team,
IPG--Institutionalized project governance board.
