Pulling in opposite directions

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Posted by APM on 3rd Aug 2015

The difference in behaviour between a client and a contractor can be the difference between project success and failure, according to new research.

Key findings from the research, which was sponsored through the 2014/15 APM Volunteers Research Fund, discovered that elements of agency theory, such as the impact of goal incongruence, asymmetry of information, opportunistic behaviour and different attitudes to risk, help explain variations in project performance.  

Professor David Bryde of Liverpool John Moores University and his co-researcher Roger Joby of R&N Consulting Ltd looked to see if principal agent theory provides an explanation for different levels of success on outsourced projects.

Principal agent theory tries to make sense of the behavioural problems that you may experience in outsourced projects, where the principal is the project sponsor/client and the agent is the project supplier/contractor(s). 

Professor David Bryde reveals that such behavioural problems are those that focus on the actions of the individuals involved in the project.

“Systems and organisational structures are important, though some projects fail even where well-developed and mature organisations and systems are in place," he said.

“Hence it is necessary that practitioners have some understanding of why people act in certain ways and how such understanding can be used to positively influence behaviours to the benefit of the project.

“For example, if one considers the list of success factors in the APM’s recently published research report Conditions for Project Success, such as competent project teams, commitment to project success, supportive organisation, capable sponsors and aligned supply chain, many of the factors require people to act in certain ways to be present and working well.”

This is the reason behind APM’s interest in funding the research as it seeks to explain why factors are present and why they are important.

Since collecting and analysing the data from the pharmaceutical and construction industries the results have been presented to both national and international audiences.

The Pharmaceuticals Contract Management Group has shown particular interest as their industry becomes more price-conscious, so there is a need to deliver projects more efficiently and effectively.

On top of events in Warsaw and Munich, the research results were recently fed back to the APM Planning & Control specific interest group (SIG) during the eVa20 Conference in London.

As part of their dissemination activities David and Roger are in the process of writing a paper which will target the academic audience through a selected journal. They are also preparing an APM Volunteer Research report, provisionally scheduled for publication in the autumn of 2015.

While defining Phase 2 they have found that the research has sparked a great deal of interest. Particularly in the potential of the research paving the way for the development of a diagnostic and predictive tool that companies can utilise as part of their ongoing project health check activities.

To explore this further David and Roger are looking to hear from companies and organisations interested in collaborating on the next stage of the research, by providing access to their projects to test the tool.

To discuss this further please contact either Professor David Bryde or Roger Joby via email.

Image: luckey_sun (flickr)

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