Human beings' desire and need for project success, the vocation of mankind, has broadened the perspective of project success from results oriented success to the process of the phenomenon and its origin. To succeed in projects that have been enlarged, convoluted, and diversified with changes triggered by the industrial revolution and technological advancement, project management (PM) has expanded from independent and individual project management to program and portfolio management, which allows the management of convergent and complex projects. A variety of PM methods, skills, and tools have been subdivided, specialized and developed accordingly. Throughout this process, there have been diverse perspectives on project success, and there has also been the need for a comprehensive and all-embracing exploration of knowledge on project success (Shenhar et al. 1997; Meskendahl 2010; Jugdev & Muller 2005; Valverde, 2015).

Project success is the successful execution (project's actualization process), and its result supersedes successful planning. Successful episteme on the concept of project is a precondition for successful planning (Dvir et al. 2003). Therefore, in order to achieve project success, the identification of successful episteme is necessary and inevitable.

Hegel stated in the *Phenomenology of Spirit* that consciousness activities, based on the dialectical logic principle of consciousness and self-consciousness, complete the absolute

spirit by reaching absolute knowing, in which the reality of spirit corresponds with the one of nature within the spirit itself through the concept of logic. This paper approaches the matter of project success from an epistemic perspective, differentiates the form, means and mechanism of the truthful episteme oriented towards absolute knowing, and investigates each of the intrinsic contents of the form, means and mechanism to apply them to project phenomenon. Through application, project managers can overcome the limitations of their episteme caused by emotional delusion, which appears as sensory conviction, conviction derived from the abstraction of concepts, and erroneous conviction of their physical activities. The design aimed at project actualization unfolds from project identification, establishment of project action and management plan, sublating towards the project success of all-embracing perspective.

### 2. Literature Review

The history of industrial development contributed to the creation of the present physical world, is the history of project actualization in the phenomenal perspective and has grown, derived, and expanded in the direction of pursuing the civic value. As humanity marks the fourth industrial revolution, where information participation and exchange of the community is expanding, mankind is experiencing the evolution towards a generation that requires creativity for convergent and complex designs, such as the smart cities.

Although in the past 60 years or so, the history of project management development within the history of the industrial development had centred around international organizations like IPMA, PMI, APM, etc., and developed into structures, such as the ISO, PMBOK®, PRINCE2®, IPMA ICB (Individual Competence Baseline), etc., there is a lack of consensus on a consistent interpretation and clear definition regarding project success (Ika 2009; Stretton & Crawford 2014; Milind & Gopinath, 2016). Disputes on the extent of project success have expanded from results oriented success perspective, to the perspective of successful process and to episteme as its origin (Radujkovic & Sjekavica 2017). Just as the 'perspective' of the Eye of Competence from IPMA ICB 4.0 (IPMA 2016) is put forward as a case that emphasizes project managers' epistemic aspects, the importance of the project managers' episteme has been accentuated and expanding (Shaw 2010). From the perspective that human's episteme is the origin of industrial development, which is a result of various project actualization, and the development of PM's body of knowledge, PM as an instinctive managerial consciousness for bringing projects to success has an apodictic relationship with projects, as the vocation of mankind.

The philosophical effort of pursuing the truth of episteme made great progress in German idealism. Kant's critical philosophy (1781/1998), which distinguishes consciousness and object and dualizes spirit and material, and identity philosophy of Schelling (1797/1979) and Fichte(1800/1987), which suggests that everything in nature is one within the spirit, was compiled by Hegel's dialectical logic philosophy, unifying duality with the dialectical logic of consciousness and self-consciousness. By the dialectical logic development of consciousness and self-consciousness, the being corresponds with the concept and the truth corresponds with conviction in the absolute knowing driven towards the absolute spirit, according to Hegel's *Phenomenology of Spirit*. As the absolute spirit and its episteme and logic are the truth, this paper seeks to identify the characteristics from the intrinsic elements of truthful episteme and apply them to project actualization, aiming towards the absolute knowledge (Kant 1781/1998; Schelling 1797/1979; Hegel 1807/1977).

The exploration of the truth on the phenomenal episteme has been providing an important academic basis for PM, and the improvement in quality of episteme to achieve project success brought realistic management methodologies, such as Critical Success Factor (CSF), Key Performance Indicator (KPI), and so on (IPMA 2016). The rise of the importance of epistemic administration and management in PM, a practical field, is an instinctive and apodictic result, displaying the potential of integrating all disciplines. From such a perspective, by defining the project phenomenon's intrinsic characteristics, I previously presented that PM's area expands by growth, derivation, and expansion beyond the areas of science, technology, politics, economy, society, culture, and to nature within the sustainability of history (Kim 2015; PMIAA 2015).

This paper identifies the intrinsic elements of the episteme, as the epistemic form, means, and mechanism, and presents PICS and PLDC that resolves the confusion in episteme from the complexity caused by the two opposing logic between project identification and action which appear in the consciousness activities of project phenomenon, proving that projects could be oriented towards project success from an all-embracing perspective.

### 3. Methodology

The conceptual episteme of phenomenon is the origin of all being actualizations as the representation of the intrinsic contents inherent in episteme. In human history, the creation of the world through being actualization is the history of projects, as well as the vocation of mankind and the reaching point of our instinctive activities. The purpose of this paper is to differentiate the truthful episteme oriented towards the absolute knowing as the form, means, and mechanism to identify its inherent characteristics and propose the conditions for project success from an all-embracing perspective that subdues the limitations of the project executors' episteme caused by the delusion of the emotional conviction.

#### 3.1. FORM OF PHENOMENAL EPISTEME

The form of the episteme is a fundamental condition for all phenomenal episteme and refers to, in a conventional sense, time, space and category (Kant 1781/1998; Hegel 1807/1977; Hessen 1964). Phenomenal episteme is conceptual episteme and since a project is a phenomenon, it is recognized as a concept. A concept is the content that results from the temporal-spatial categorization of feelings and emotions where the meaning and significance are given. All concepts obtain sameness from the associated structure of the characteristics based on the temporal-spatial categorical form (Kant 1781/1998; Hegel 1807/1977; Kim 2015).

As in Whitehead's (1927/1979) proposition that "The past has an objective existence in the present which lies in the future beyond itself " and in Fichte's (1800/1987) notion of the repetition of precedents and Heidegger's (1927/2008) notion of projection from the past to the future, the temporality inherent in all concepts manifests itself in history as sustainability through the dialectical principle of logic. Just as Hegel (1807/1977) presented a conceptual space that logically encompasses all of nature, and as Schelling (1797/1979) said in one of his famous quotes, "Nature is visible Spirit; Spirit is invisible Nature," all spatiality is comprehensively relational within nature. As temporal-spatial characteristics mutually inherent in concepts, all time and space manifest themselves merged in a single phenomenon in history and nature.

Project goals and objectives, from the perspective of realization, are spatial contents where time remains still, and it is an abstract potentiality. The concept of a project, for the realization of goals and objectives to fulfil dreams and visions, attains actuality when both temporal procedures and spatial contents from the beginning to the accomplishment of a project become specified. The concepts and their elements that become specified in the procedures and contents of the project phenomenon possess sameness in their intrinsic contents, and lie in mutually-associated temporal and spatial relations. In this perspective, the area of PM expands beyond science, technology, politics, economics, society, culture, and to nature.

#### 3.2. MEANS OF PHENOMENAL EPISTEME

The consciousness activities, in the means of phenomenal episteme, based on the development of concept's dialectical logic, unfold into emotional thinking reliant on feelings and emotions, intellectual thinking that captures the meaning and significance of contents as a concept, and logic-oriented rational thinking that identifies logical relations among the concepts, sublating towards the absolute spirit.

Concept is the content that the meaning and significance are given to temporal-spatial categorization of feelings and emotions. One concept divides into many and essentially becomes concrete as intrinsic contents. These concepts integrate into a single concept through the dialectical principle of logic. Hegel elaborates the dialectical activities of consciousness and self-consciousness through the three "moments" of the concept: universality, particularity, and individuality. Thus, this is plainly expressed in the proposition "The one becomes many; and the many becomes one" (Whitehead, 1927/1979; Hegel, 1807/1977). From a subjective perspective, a concept connotes many concepts within itself, and the concept becomes transformed into an objective perspective through the relations with other outside concepts; the subjective and objective perspectives on the concept manifest themselves as sameness through the dialectical principle of logic of the absolute spirit.

As such, in project phenomenon, many projects exist within one project, which itself exists as an object in relation to a variety of other external projects. The project goals and objectives develop from abstract to universal and the conceptual elements and items related to the realization of the goals and objectives are driven from diversity to unity through the dialectical principle of logic, and the logical interrelations among the concepts that form a project develop from contingency into necessity.

#### 3.3. MECHANISM OF PHENOMENAL EPISTEME

I suggest in this section the mechanism of phenomenal episteme, and define the intrinsic contents of being actualization based on the temporal-spatial characteristics and properties of the concept of being, which were identified from the form and the means of episteme.

In the process by which the form and the means of episteme function, the conceptual information attained from actuality experience and ideation experience goes through the process of appropriation of data according to logical principles, which enhances the quality of information by having its data of experiences matrixed by logical order, sort, and arrangement. This improves the future design capability of being actualization (Figure 2). The project that aims at being actualization manifests itself as sustainability in history as time and relationality in nature as space. Such consciousness activities reconcile project design with actuality and affirm project success from an all-embracing perspective. This can be explained as an example, such as predictive analysis through big data, weather forecasts from a meteorological

administration, and future forecasts by means of the self-learning of AI (Artificial Intelligence) (Makridakis 2017; Mayo & Leung 2018).

Figure 2 Epistemic mechanism of phenomenon (EMP) (Kim 2015)

Based on the intrinsic contents inherent in episteme, that are defined from the mechanism of phenomenal episteme through its form and means, the conditions for project success from an all-embracing perspective are suggested as follows.

First, as temporal-spatial categories is inherent in the form of project, the project goals and objectives must be dualized and studied as temporal procedures and spatial contents. Second, based on the logical characteristics by which one project connotes many projects and many projects are subsumed as one project, the concept of project goals and objectives must become concrete as a detailed set of objectives and their contents, while the intrinsic contents of project must be defined within the unified associated structure of temporal-spatial categories. Third, the project goals and objectives must comply with the logical principles of procedural sustainability of time and the relationality of contents in space (Robertson & Williams 2006).

Figure 3 Inherent essence of form, means, and mechanism of episteme

By unfolding from project identification and implementation of project action and management plan that comply with the aforementioned three conditions, project executors overcome the delusion of sensory conviction, delusion derived from the abstraction of concepts (Hegel 1807/1977; Hessen 1964), and delusion from erroneous conviction of physical activities, which are the limitations of emotional delusion that is inherent in their episteme itself, affirming success from an all-embracing perspective.

### 4. Project Phenomenon

The consciousness of project managers in regards to being actualization of dreams and visions, gains potentiality from project identification that meet the conditions for project success from an all-embracing perspective, which is drawn from the episteme that is the truth, finds conviction of actuality through the project's action plan, and gains certainty from the management plan of the project executors, through which the conviction of project success from an all-embracing perspective is self-realized (Kim, 2015) (see Figure 4).

Figure 4 Development of project episteme and phenomenon

#### 4.1. PROJECT IDENTIFICATION

Project identification is the identification of the universal meaning and significance of the concept of project and its intrinsic contents. It is figuring out, based upon analyses like the SWOT analysis, project environment, and stakeholder analysis, the intrinsic contents of temporal procedures and spatial contents from the beginning to the accomplishment for project goals and objectives that meet the expectations of stakeholders (Pinto & Slevin 1988; Cox 2016). This develops in the following phases: (1) determine strategic objectives, (2) differentiate procedures and contents from the beginning to the accomplishment of project objectives, (3) identify procedural objectives and define the associated elemental objectives as well as item objectives within the elements, and (4) all projects, objectives, elements, and items are concepts, and as such, they possess sustainability within history and logical relationality in pursuing the civic values as a goal.

Many projects exist within a single project, which also may serve as an element that constitutes a larger project (Kim 2015). In the dimension of the fourth industrial revolution, where projects are becoming increasingly complicated and larger in scope, like smart cities, there is a gradual increase in the need for new and improved management tools and knowledge. Moreover, projects continually change, and the management of such changes and risks has been emphasized as a crucial element for project success of an all-embracing perspective. From this sense, I propose PICS for the design of project phenomenon.

In project identification, the intrinsic contents of temporal-spatial procedures and contents develop as (1) objective projects within the project, (2) objective elements within the objective projects, and (3) objective items within the objective elements. In Figure 5, a project such as a national agenda is categorized and subdivided into the projects of departments, divisions, and organizations on temporal procedures, of which intrinsic contents develop as elements and items. PICS provides important standards for the decision of project, program, or portfolio management, and predicts CSF from identifying the changing goals, elements, and items of each procedures and its phases of the project, designing KPI that manage such changes. Therefore, PICS, as the management of the project's temporal-spatial identification of the truth and its actualization, has an apodictic development of project success from an allembracing perspective.

Kim

**Figure 5** Project identifying and categorizing structure (PICS)

#### 4.2. PROJECT ACTION PLAN

The actuality perceived through project identification is driven towards potentiality from the perspective of project actualization, and becomes fulfilled through the establishment of the project action plan. In the phase where the project action plan is established, the optimal means and methods to realize CSF, which is a set of core elements and items numerically subdivided through PICS, are determined, and tasks and KPI are assigned to project executors and executing organizations. The project executors and executing organizations then manage CSF and KPI as core elements and performance indicators needed for successful implementation of the project's strategic objectives. At the same time, project managers manage the outcomes related to procedures and contents of the project's strategic objectives, as well as examine and manage CSF and KPI associated with such processes.

As shown in Figure 6, in the development of consciousness from 'Potentiality A' to 'Actuality B' for being actualization, the objectives in project identification are broken down into their elements, and item objectives through temporal-spatial categorization and logical subdivision of procedures and contents. The elements and item objectives, which became concrete during the phase of project action, reach convergence (Whitehead 1927/1979; Green 2003) during the process of their realization and achieve being actualization as actual deliverables that belong to the actualized intrinsic contents. I suggest PLDC, a development of opposing logic between project identification and action which appear in the consciousness activities of project phenomenon. It is the development of logical consciousness merged through the actualization process from 'Potentiality A' to 'Actuality B', distinguishing the development from 'potentiality a' to 'actuality b' in the phase of project identification and the one in the phase of project action. As there are opposing thoughts that exist as division and convergence in the project actualization process, we find it difficult and complicated if this process is viewed as one. However, PLDC resolves the problems of the confusion of episteme and the complexity of project actualization process through the conceptual dualization of the information's division and convergence, defining and combining again.

**Figure 6** Project logic of division and convergence (PLDC)

#### 4.3. PROJECT MANAGEMENT PLAN

The project management plan manages the implementation of the action plan to meet the conditions for project success from an all-embracing perspective. Under the project management plan, project managers utilize CSF and KPI drawn from PICS as core elements and management indicators, to examine and manage the implementation of the action plan in terms of factors such as time, cost, quality, safety, health, risk, and change. PICS systemizes the project management plan for project identification and actualization through the logical development of temporal-spatial procedures and contents related to the project's strategic objectives as well as elemental objectives and item objectives to meet the expectations of stakeholders, thereby leading to obtaining certainty of project success from an all-embracing perspective (Figure 7).

Humans, through the development of project identification, project action and management plan that meets the conditions for project success from an all-embracing perspective, overcome the sensory conviction, conviction derived from the abstraction of concepts, and erroneous conviction of their physical activities, which exists within the project executors' episteme itself, achieving project success in the outcome, process, the cause, and pursue civic values within the

phenomenon of sustainability and relationality, aiming towards the successful episteme that reaches project success of an all-embracing perspective.

### 5. Conclusion

This paper identified from history that the vocation of mankind is being actualization, which is project actualization, and that successful episteme must precede the project's process and its outcome in order to achieve project success from an all-embracing perspective. By identifying and applying the intrinsic characteristics of the truthful episteme that drives toward the absolute knowing, I brought forward the conditions necessary for an all-embracing perspective of project success to overcome project executors' delusions caused by their emotional conviction. Through the conditions, I presented a new PICS in which the project goals and objectives are distinguished as temporal-spatial categories and gain concreteness as procedures and its contents under the properties of concepts, and comply with the sustainability of history and relationality of nature from the sameness of temporal-spatial categories. It also identified that confusion in episteme and complexity of project actualization process could be resolved by PLDC which is a logical development of two opposing thinking between project identification and action that appear in the consciousness activities of project phenomenon. The project identification, project action and management plan is the development of episteme to obtain a successful plan and outcome, leading towards an all-embracing perspective of project success. The Incheon Bridge Project, designed and completed by myself, was the first to be awarded the Premium Gold from Project Excellence Award in 2015 at the IPMA 50th World Congress, being recognized as a world-class benchmark, demonstrating a real case oriented towards an all-embracing perspective of project success. (Kim 2015).

Within the history of industrial development, human beings have driven changes through intervention in reality by the spirit and body, throughout the first industrial development by which machine substituted human labour, the second industrial development that facilitated mass production, computer-based third industrial development and the fourth industrial development represented by AI (Clark & Cooke 2015). Thus diversity and complexity expanded across overall society in the areas of science, technology, politics, economy, society, culture, and so on. IoT and AI, as the core technologies of the fourth industrial revolution, are connecting humans to things, and reality to virtual reality. In this flow, the epistemic competence of project managers will expand to the orientation of successful episteme enabling success from an all-embracing perspective to be achieved. Project managers will possess future designing abilities that enable them to make design into reality, through the coexisting interrelationship of AI and spirit, as well as algorithms and logical concepts. This will provide a gateway of episteme that allows the integration of the various perspectives on the meaning of project success to be empathized. This paper is the journey of my episteme within the spirit that started from absolute knowing, self-realizing the correspondence of nature and sprit, to absolute knowledge, self-realizing that project plan corresponds with being actualization.

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### About the Author

 Honorary Doctor Soohong Kim is the CEO of Incheon Bridge Co., Ltd. and a chair professor at Kyungnam University. He also serves IPMA Korea as a vice chairman and a member of the National Academy Engineering of

Dr. Kim has been leading the Incheon Bridge, a national project of Korea

throughout all the phases from business proposal to financing, construction, operation and management so far with a remarkable success, making new records in every step of the way. For the past 15 years since when the concept of project management was not yet established in Korea, Dr. Kim has dedicated himself to analysing Incheon Bridge project from a philosophical approach to view project as a phenomenon and applying his own methodologies to Incheon Bridge construction, operation and management. As a result, Incheon Bridge became the first successful case of national policy project to which project management had been fully applied.

Dr. Kim's business management philosophy which puts theory and practice together was captured in his paper 'A Philosophical Approach to Project Management: Project as a Phenomenon and the Case of Incheon Bridge' which was published by Elsevier on Procedia. His paper was recognized by the IPMA Scientific Committee for its original contribution and was introduced to the 29th IPMA World Congress and the 3rd IPMA Research Conference.

Dr. Kim has been awarded with a number of exceptional national and international prizes including the national highest Order of Industrial Service Merit-Gold Tower Medal awarded by the President of Republic of Korea, OCEA(Outstanding Civil Engineering Achievement) Award of Merit' by American Society of Civil Engineers(ASCE), IPMA Project Excellence Award Premium Gold Winner and Project Manager of the Year (silver) for his excellent project management achievements.

International Project Management Association Research Conference 2017

2-4 November 2017

© 2018 by the author(s). This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International (CC BY 4.0) License (https:// creativecommons.org/licenses/ by/4.0/), allowing third parties to copy and redistribute the material in any medium or format and to remix, transform, and build upon the material for any purpose, even commercially, provided the original work is properly cited and states its license.

**Citation:** Schoper, Y. 2018. Plea for a more sustainable definition of project success. International Project Management Association Research Conference 2017, UTS ePRESS, Sydney: NSW, pp. 1-8. https:// doi.org/10.5130/pmrp. ipmarc2017.5926

Published by UTS ePRESS | http://pmrp.epress.lib.uts. edu.au

#### CONFERENCE PAPER

## Plea for a more sustainable definition of project success

#### **Yvonne Schoper**

HTW Berlin University of Applied Sciences, Treskowallee 8, 10318 Berlin, Germany.

**\*Corresponding author:** Yvonne Schoper<EMAIL_ADDRESS>
**Name:** International Project Management Association Research Conference 2017

**Location:** Incheon, Republic of Korea **Dates:** 2nd to 4th November 2017

**Host Organisation:** IPMA-Korea

**DOI:** https://doi.org/10.5130/pmrp.ipmarc2017.5926 **Published:** 08/06/2018

### Abstract

This paper aims to raise the awareness for the impact that project managers have for successful projects. The paper also aims to reflect if the current definition of success is sufficient. Five project examples show that projects need to fulfill sustainability requirements to be declared successful. This attitude towards project success by all project managers worldwide could have the potential to change current environmental developments worldwide.

### Motivation and background

Many definitions of project success have been published in the last decades; however, none of them seem to be sufficient for today. Project success indicates that a project is contributing significantly to the future, both for an organization and society. Projects are omnipresent in all parts of society and all industrial sectors, both in public and private life. Projects are unique and complex, ranging from small single person endeavours with a duration of a few weeks to mega-projects with thousands of people involved and a budget of several billion euros.

The following commentary aims to raise awareness of the question whether the traditional project success definition is sufficient for today and the future.

**DECLARATION OF CONFLICTING INTEREST** The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article. **FUNDING** The author(s) received no financial support for the research, authorship, and/or publication of this article.

### Definitions of project success

As per definition, "every project is a temporary endeavour undertaken to create a unique product or service" (PMI 2000). "Projects differ in size, uniqueness, and complexity; thus the criteria for measuring success vary from project to project" (Müller & Turner 2007).

"Project success is one of the most researched areas in project management" ( Joslin & Müller 2015) as the meaning of "success" varies substantially ( Judgev & Müller 2005). The understanding of project success has developed substantially in the last decades as Figure 1 shows. The project success definition went through four periods, as the project life cycle enlarged from the project implementation and handover (Period 1) to the critical success factors (CSF) discussion (Period 2) to the CSF framework analysis (Period 3) towards strategic project management (Period 4).

Figure 1 Evolving view of project success Source: Jugdev & Müller (2005)

"Individuals and stakeholders interpret project success in different ways" (Cleland & Ireland 2006). The following definitions show that there is no unanimous definition of project success among the researchers.

Pinto and Slavin define project success as project implementation success, meaning technical and organizational validity and organizational effectiveness (Pinto & Slavin 1988). Watt defines project success as "a high level of satisfaction concerning the project outcome among the key stakeholders" (Watt 2014). McLeod et al. go further and found out that "project outcomes are interpreted differently from different stakeholder perspectives at different times, constructed through subjective processes of sense-making". The criteria by the stakeholders for evaluating the project are "context- and perspective-dependent and reflect dimensions that variously focus on a project's process, product, and organizational objectives" (McLeod et al. 2012). Shenhar and Dvir state that the assessment of success is based on the four "success dimensions" of project efficiency, consumer impact, business success and preparation for the future, and that the content of each dimension and its relative importance changes with time (Shenhar & Dvir 2001). The most often used definition comes from Cooke-Davies who defines project success as a measure against "the overall objectives of the project, accomplished through the use of the project's output" (Cooke-Davies 2002).

All these definitions of project success cover different aspects of the project: the project implementation success, the level of satisfaction of the stakeholders on the project outcome, the context- and perspective-dependent interpretation of the stakeholders on the project

outcome, on the success dimensions project efficiency, consumer impact, business success and preparation for the future or use of the project's output. However, none of these definitions reflects on the phase after the usage of the project outcome, nor the sustainability of the endeavour, or the fit into the overall program or portfolio. This will be examined using five practical examples.

### Critical analysis of project success based on five project examples

The first example is the building of a new school or hospital in a developing country in Sub-Saharan Africa. This development aid project is closed within scope, time and budget, but the local population does not expect much for specific reasons, either because of a lack of teachers, medical doctors, equipment, the supply of components, trained employees, active promotion among the parents or later mismanagement. Many well-meant humanitarian aid projects are left to rot after their opening and decay within a couple of years.

The same destiny happens to the second example, the sports stadiums built for football world championships and Olympic games. These phenomena are called "white elephants," and one famous example is the Arena da Amazônia in Manaus, in the middle of the Amazonas. The stadium cost was \$ 300 million, and it was finished in time for the football championship in Brazil in 2014 and used for four football games in total. Now it is left to rot in the humid climate of the rainforest.

The third example is the building of nuclear power stations, without knowing how and where the resulting nuclear waste can be stored safely or rendered harmless, leaving this assignment for future generations.

The fourth example of unsuccessful projects is newly built bridges that are constructed without road access. In Germany, these bridges even have a name "Soda-Brücke" or "ghost bridges" because they are not a one-off phenomenon. Wikipedia currently reports eleven of these bridges in Germany, one in Switzerland, one in the Netherlands and one in New Zealand.

The fifth example is the building of new wind power farms in the North Sea in 2013, without the installation of equipment to transfer power to the countryside. To prevent damage to the new wind power wheels, additional generators had to be installed to drive the wheels.

These five examples raise the question of whether these projects can be called successful. They were all completed on time, on budget and fulfill their scope.

But in comparison to the past, people increasingly do not accept unsustainable projects any more. As a consequence, the definition of project success must be adapted to fit these different sorts of challenges.

### Proposal for an enlarged understanding of project success

Referring to the five project examples, the extended definition of project success including all product lifecycle phases would already declare all of the five projects as failures, as the projects did not consider the utilization or close-down phases.

The examples of rotting schools and football stadiums in the rainforest, the rotting bridges without road access, and the nuclear power stations show that project managers must not only plan and steer, but also plan for the time after the close-down of the projects. The recycling aspect is missing in many project success definitions and consequently a broader definition

is needed, with increased understanding of project success. The project and product lifecycle perspective should be extended to the complete recycling of the product into its original materials to enable reuse of the raw material. This enlarged perspective on the project and product lifecycle, including the recycling phase builds, the first axis of the new project success triangle.

People with good general education and a profound understanding of the conception of causal relations strive for a sustainable living, where sustainability is embedded into the lifestyle, including all products and services. More and more people demand sustainable, ethical leaders who strive for making this vision coming true to leave the planet as a healthy place to live for future generations. The Institute for Sustainable Development says "sustainable development is the development that meets the needs of the present without compromising the ability of future generations to meet their own needs." (International Institute for Sustainable Development 1992).

During the 4th IPMA Research Conference 2016 in Reykjavik, Iceland, with the theme "sustainability in project management", 40 professionals and academics from five continents discussed the meaning of sustainability for project management. All agreed unanimously that the current short-term understanding of project success must be extended to a long-term definition, where the needs of the present are met "without compromising the ability of future generations to meet their own needs". As a consequence, the second axis of the new project success triangle consists of the need for sustainability. This new sustainable understanding of project success puts a new light on projects like the building of a nuclear power station which lacks a concept of how to recycle the nuclear waste.

The examples show that original objectives but must always be evaluated concerning their contribution to the program. The examples of the deserted school, the football stadium, the host bridge or the wind power farm show that these projects are only successful if they fit into and are part of a wider strategy.

In case of the school building, this project should be part of a general education program, e.g., to reduce the rate of illiteracy in the population under 18 years by 25% in a specific area. A successful school project should also include an education program for the illiterate mothers of the school girls, to convince them that they can prevent their daughters from having the same destiny as themselves. In case of the football stadium in an area like the Amazonas, a successful long-term program would include the support of a local football club, in addition in addition to training facilities for the young generation. In case of the bridge project, the overall program would also include the financial coverage of the construction of the adjoining roads. In case of the wind power farm project, a successful program should include the timely preparation of the electric transfer mechanism to the land.

These examples show that projects may not only be assessed against their single objectives but should also be evaluated concerning their contribution to the program success. However, a program is not a single set of endeavours but belongs to a project portfolio. Therefore, the program success should be evaluated in the light of the overall project portfolio. As a consequence, the author suggests integrating a third axis named project/ program/ portfolio perspective. As a result, we receive a three-dimensional triangle that consists of the new three perspectives that must all be fulfilled at the same time to call a project successful. Figure 2 shows this new holistic understanding of project success:

### Setting of a new sustainable project success guideline

The International Project Management Association IPMA, as one of the two international project management standard-setting organizations, can have a relevant impact on its global influence on project managers worldwide.

IPMA´s Individual Competence Baseline ICB4 launched in 2015 lacks a definition of project success. It defines in detail the critical success factors for project managers and highlights the importance of success, but a definition of project success is not included. In comparison, the previous version ICB3 launched in 2006 which defined project success as follows: "To assess competence is one thing, but the ultimate goal of a project or programme manager is to be successful". For that reason within IPMA, project success is defined as "the appreciation by the various interested parties of the project outcomes." This definition is more challenging than "to produce the project deliverables within time and budget."

One could state that the previous ICB3 definition of project success was good at its time, but this definition is not sufficient as the five examples showed.

In times of global warming, depleting natural resources, overpopulation, a daily decimation of animal and plant species, increase of epidemic diseases, environmental degradation and acidification of the oceans, the quality of life today, but particularly the lives of future generations is jeopardized. The causes of the symptoms described above are all human-made. Consequently, only human beings can stop and change this development. However single actions of few people do not lead to the impact that is needed. Common, distinct measures of all people are needed for a meaningful, relevant change.

Which role could the profession of project managers play in this change process? Projects are vehicles of change. In fact, project managers are change agents (PMI 2017) both in organizations and in society. Their task is to implement the strategies of the decision makers by realizing and accomplishing the objectives of projects. What is needed is a change of values

and behaviours of the community of project managers worldwide. If project managers would start to adopt the corporate business strategies in the way to protect, sustain and enhance the human and natural resources for the future, this could create a global change.

As a consequence, the current understanding of success must be critically reflected. A new understanding of project success is needed, aiming to accomplish the objectives of a maximum of profit and sustainability. This mindset includes understanding and managing of the shortand long-term economic, social and environmental impacts of all operations in projects, programs, and portfolios. The new definition of project success should be defined and agreed with all project stakeholders at the beginning of a project, and it should include not only the project but also the overall product life cycle perspective including the close down/ reassembly and the recycling of the product.

The following figures show the situation concerning project success in general and for some industries or countries:

The studies show that the majority of projects are not successfully completed within scope, time and budget, which leads to enormous financial waste worldwide. Let´s consider a mind game: the world´s Gross Domestic Product (GDP) in 2016 was \$75.8 trillion (World Bank, OECD). Research on the size of projects in Western economies shows that one-third of the national GDP in European countries is created by projects (Schoper et al. 2018). Let us assume that on average 20% of world´s GDP is created by projects, then \$15.1 trillion would be created by projects. If we then take the statement that for every \$1 billion, \$97 million are wasted due to bad project performance (PMI 2017), an annual sum of \$1.4 trillion is wasted every year due to this cause. This sum corresponds to the annual GDP of Russia, with 144 million people. If this money could be saved and invested in humanitarian aid, infrastructure, education and agriculture projects in the developing countries, one can imagine that the world could be made a better place within a couple of years.

### Outlook and conclusion

If all 250,000 IPMA certified project managers worldwide would agree to this new, sustainable understanding of project success and act accordingly, e.g., by refusing to manage unsustainable, unethical or resources-exploiting projects, the profession of project managers could contribute hugely to the change necessary to preserve the planet earth for future generations.

The future ICB5 by IPMA should contain a new, up-to-date definition of project success that corresponds to the requirements and needs of today´s global world. This could set the baseline for implementing a change of thought worldwide.

As a consequence, the author suggests adding to the IPMA´s Code of Ethics a Code of Conduct based on this new understanding of project success. All IPMA certified project managers should declare that they act following this ethical standard. This gives an ethical compass to all IPMA certified project managers worldwide. But also project principals would be assured that by hiring an IPMA project manager they will be provided with a sustainable long lasting successful project.

With this new understanding of project success, current projects will not only be built for a one-off event, but continue to be used, lasting for future generations. If project managers

would become more personally responsible for the success of their projects, financial waste could be dropped, and the money invested in humanitarian aid projects. The world could be made a better place within a short time-scale.

### References

Cleland, D.I.; Ireland, L.R., (2006) Project management: Strategic Design and Implementation. 5th edition. McGraw-Hill, New York.

Cooke-Davies, T.J., (2002) The "real" success factors on projects. Intern. Journal of Project Management, 20 (3), 185–190.

Flyvbjerg, B., (2011) "Over Budget, Over Time, Over and Over Again: Managing Major Projects" in The Oxford Handbook of Project Management, edited by Morris, P.; Pinto, J.; Söderlund, J.; Oxford University Press, pp. 321-344.

International Institute for Sustainable Development, (1992) http://www.iisd.org/topic/sustainabledevelopment (Date of access: July 27, 2017).

International Project Management Association, (2006) Individual Competence Baseline ICB 3.0. http:// www.ipma.world/assets/ICB3.pdf (Date of access: July 27, 2017).

Joslin, R.; Müller, R., (2015) Relationships between a project management methodology and project success in different project governance contexts, Int. Journal of Project Management 2015 (33), p. 1377- 1392.

Judgev, K.; Müller, R., (2005). A retrospective look at our evolving understanding of project success. Project Management Journal 36 (4), 19–31.

McLeod, L., Doolin, B., & MacDonell, S.G. (2012) A perspective-based understanding of project success, Project Management Journal 43 (5), pp. 68-86.

Müller, R.; Turner, R., (2007). The influence of project managers on project success criteria and project success by type of project. European Management Journal 25 (4), p.298-309.

Project Management Institute, (2000). A Guide to the Project Management Body of Knowledge, 5th edition.

Project Management Institute, (2017). https://www.pmi.org/about/learn-about-pmi/who-are-projectmanagers (Date of access: July 18, 2017).

Schoper, Y.; Wald A.; Ingason, H.T.; Friðgeirsson, T. (2018) Projectification in Western Economies: A Comparative Study of Germany, Norway, and Iceland. *International Journal of Project Management*, 36 (1), 71-82.

Wikipedia, (2017) https://de.wikipedia.org/wiki/Soda-Br%C3%BCcke (Date of access: July 27, 2017).

### About the Author

 Dr. Yvonne Schoper is Professor for International Project Management at HTW University of Applied Sciences Berlin. Dr. Schoper holds a BSc in Engineering Management, an MSc International Business and a Ph.D. in Industrial Engineering. She worked as a project manager for BMW where she was responsible for several international automotive

development projects in USA and in Germany. Since 2009 she is associate Professor for Project Management at the Tongji University in Shanghai (China).

Her research interests are intercultural project management, future trends in project management, women in project management and the further development of the profession of project managers.

From 2012-2015 she was Executive Board member of GPM Germany where she was responsible for research. Since 2015 she is the delegate of Germany at IPMA´s Council of Delegates. Since 2016 she is member of the Presidential Advisory Board of GPM.

International Project Management Association Research Conference 2017

2-4 November 2017

© 2018 by the author(s). This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International (CC BY 4.0) License (https:// creativecommons.org/licenses/ by/4.0/), allowing third parties to copy and redistribute the material in any medium or format and to remix, transform, and build upon the material for any purpose, even commercially, provided the original work is properly cited and states its license.

**Citation:** Jeong E., Jeong, S. and Kang, C. W. 2018. Effective Project Governance Institutions for IT Service Project Success. International Project Management Association Research Conference 2017, UTS ePRESS, Sydney: NSW, pp. 1-15. https://doi.org/10.5130/ pmrp.ipmarc2017.6003

Published by UTS ePRESS | http://pmrp.epress.lib.uts. edu.au

#### CONFERENCE PAPER

# Effective Project Governance Institutions for IT Service Project Success

#### **Eun-Joo Jeong<sup>1</sup> , Seung-Ryul Jeong<sup>2</sup> , Chang Wook Kang3\***

**<sup>1</sup>**SK Holdings Company, 26, Jong-ro, Jongno-gu, Seoul, 03188, Republic of Korea **<sup>2</sup>**Kookmin University, 77 Jeongneung-Ro, Seongbuk-Gu, Seoul, 02707, Republic of Korea **<sup>3</sup>**Hanyang University, Sangroku-gu, Ansan-si, Gyeonggi-do 426-791, Republic of Korea

**\*Corresponding author:** Chang Wook Kang<EMAIL_ADDRESS>
**Name:** International Project Management Association Research Conference 2017 **Location:** Incheon, Republic of Korea **Dates:** 2nd to 4th November 2017 **Host Organisation:** IPMA-Korea

**DOI:** https://doi.org/10.5130/pmrp.ipmarc2017.6003 **Published:** 08/06/2018

### Abstract

Recently, in pursuit of sustainable competitiveness, IT (information technology) service projects have been increasingly undertaken to introduce new technologies and advancements such as big data analytics, AI (artificial intelligence), Cloud Computing, mobile computing, IoT (Internet of Things), and business process changes.

However, the project success rates of IT service projects have declined because of the various kinds of risks associated with the characteristics of these projects, such as software invisibility, unclear user requirements, the complexity of IT systems and new technologies, and agency conflicts such as different goals, different risk attitude, and information asymmetry among project participants. The profits and success rates of IT service projects have fallen because of risks and agency conflicts.

In this study, we analyzed the gaps in average profits rates by revenue group for IT service companies in South Korea by one-way ANOVA (analysis of variance) analysis of SPSS V20 statistical tool. The result showed that the average profit rate of the revenue group over 1 billion USD was twice than the revenue groups of less 1 billion USD, and the gaps of average profit rates among revenue Group 1 and other revenue groups were statistically significant.

**DECLARATION OF CONFLICTING INTEREST** The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article. **FUNDING** The author(s) received no financial support for the research, authorship, and/or publication of this article.

In addition, we investigated the maturity level of project governance by revenue groups of IT service companies with FGI (focus group interviews). The results showed that higher revenue groups were the higher maturity level of project governance. Furthermore, we investigated the change of failure rate of IT service projects in a company with the application of project governance institutions. The results showed that this failure rate decreased by 14.8% with the application of project governance institutions.

We recommend the application of project governance institutions such as project governance board, project steering committee, project management office (PMO), stage-gate process (SGP) in order to increase the profit rates of projects and to decrease the failure rates of projects.

### Keywords

**Project Governance, Institutional Analysis and Development Framework, Agency Theory, IT Service Project, Project Risk, Project Management Office, Stage-Gate Process**

### 1. Introduction

IT service projects involve the application of business and technical expertise to enable organizations in the creation, management, and optimization of or access to information and business processes. IT services refers to the application of business and technical expertise to enable organizations in the creation, management and optimization of or access to information and business processes. The IT services market can be segmented by the type of skills employed to deliver the service (design, build, and run). There are also different categories of services: business process services, application services, and infrastructure services. If these services are outsourced, they are referred to as business process outsourcing (BPO), applications outsourcing (AO) and infrastructure outsourcing (IO) (Gartner 2017).

In South Korea, many banking and manufacture companies have outsourced IT service projects, including AO and IO, because of a scarcity of employees and competencies in software development and project management. But the success rate of IT service projects is low due to risks with software invisibility, unclear requirements, complexity of IT systems, and agency conflicts among project stakeholders. To reduce or prevent risks originating in the characteristics of IT service projects, as well as agency conflicts among project stakeholders, project governance institutions are required. Project governance institutions include project steering committee (PSC), PMO, SGP functions.

The following research procedure was adopted:

	- Conduct FGIs on the maturity level of project governance institutions and the status of the SGP applications by revenue groups of IT service companies in South Korea.
	- Conduct an empirical case study about changes in project failure rates through the application of project governance institutions to an IT service company.

Section 2 introduces background knowledge of the IAD framework, agency theory, and project governance concepts. Section 3 explains the application of the IAD framework to IT service projects. Section 4 explains the results of this application to project governance institutions. Finally, Section 5 discusses the results and limitations of this study as well as possibilities for future research.

### 2. Background Knowledge

#### 2.1 IAD FRAMEWORK

The IAD framework was developed by Elinor Ostrom. It relates a set of concepts to help in the analysis of collective action problems that involves social structures, positions, and rules. Under the rational choice model, the IAD framework was devised in an attempt to explain and predict outcomes by formalizing the structures, positions, and rules involved in collective choice problems. Thus, it can be seen as a systematic method of collecting policy analysis functions, similar to analytic techniques commonly used in physical and social sciences, and understand how institutions operate and change over a period of time (https://en.wikipedia. org/wiki/Institutional\_analysis\_and\_development\_framework, 2017). The IAD framework helps researchers perceive complex social phenomena by dividing them into smaller units of readily understandable functions. The important aspect of the IAD framework is that its outcome is influenced by the institutional or rule arrangements created by local actors in a given context. The IAD framework consists of action situations such as physical attributes, community attributes, and institutional or rules arrangements, models of actors, patterns of interactions, and outcomes (Ostrom 1994), as seen Figure 1.

Figure 1 provides a schematic representation of the framework. The focus of the analysis is on behaviour in the action arena, which includes the action situation, and individuals and groups who are routinely involved in the situation (actors). One objective of the analysis is to identify factors in each of three areas that influence the behavior of individuals and groups in the policy situation: physical and material conditions, community attributes (culture), and rules-in-use or institutional arrangement. Two other objectives are to identify and evaluate patterns of interactions that are logically associated with behavior in the action arena, and outcomes from these interactions (Polski & Ostrom 1999).

Physical attributes are traits or characteristics of events that become a target of interaction for participants, and refer to the transformation of events due to interactions among participants. The variables of an action situation are also affected by attributes of the relevant physical world. The physical possibility of actions, likelihood of outcomes, linkages of action to outcomes, and knowledge of actors all depend on the physical world and its transformation. The same rule configuration may yield entirely different types of action situations depending

upon the types of events in the physical world being acted upon by participants (Ostrom 1994).

Community attributes include generally accepted norms of behavior, the level of common understanding about action arenas, the extent to which preferences are homogeneous, and the distribution of resources among members. The term "culture" is frequently applied to this bundle of attributes. Community attributes affect the structure of an action arena because the latter relates to the community in which an action situation is located (Ostrom 1994).

Institutions or rules are prescriptions that define what actions (or outcomes) are required, prohibited, or permitted and the sanctions authorized if rules are not followed (Crawford & Ostrom 1995). All rules are the results of implicit or explicit efforts to achieve order and predictability among humans by creating classes of persons or positions who are then required, permitted, or forbidden to take classes of actions in relation to required, permitted, or forbidden states of the world. The actor in a situation can be thought of as either a single individual or a group functioning as a unified corporate actor. The term "action or model of actor" refers to those human behavior for which the acting individual attaches a subjective and instrumental meaning. Individuals who calculate benefits and costs are fallible learners who vary in terms of the number of other persons whose perceived benefits and costs are important. These individuals must often make choices based on bounded rationality and opportunism with incomplete information and imperfect information-processing capabilities. Moreover, the level of opportunistic behavior that may occur in any setting is affected by the norms and institutions used to govern relationships in that setting, as well as by the decision environment's own attributes. Elements of an action situation make interactions with a model actor yield positive or negative results or outcomes (Ostrom 1998).

Figure 1 IAD framework (Ostrom 1994; Polski & Ostrom 1999)

#### 2.2 AGENCY THEORY

Agency theory involves a contract under which one or more persons (shareholders) engage other persons (directors) to perform some service on their behalf, which includes delegating some decision-making authority to the agent, as seen Figure 2 (Eisenhardt 1989). If both parties to the relationship are utility maximizers, there is good reason to believe the agent will not always act in the best interests of the principal ( Jenson and Meckling 1976). Agency conflicts include goal conflicts, different risk attitudes, and information asymmetries (Eisenhardt 1989; Saam 2007).

Figure 2 Agency Theory (Eisenhardt 1989)

#### 2.3 PROJECT GOVERNANCE FUNCTIONS

Project governance can be defined in numerous ways. It supports the provision of good project management and is an important element of successful projects (Muller 2009). Project governance includes the framework, functions, and processes that guide project management activities in order to create a unique product, service, or result and meet organizational strategic and operational goals (PMI 2016).

We consider that project governance is aligned with corporate governance, and serves as the framework for planning and controlling functions that align risk, performance, and communication domains. It guides project management activities and creates project outputs in order to meet organizational strategies and business objectives, and serve the best interests of related stakeholders (Dinsmore & Rocha 2012; Jeong et al., 2016b; Muller 2009). Accordingly, project governance can reduce risks in IT service projects such as those arising through agency conflicts, and agency problems among project stakeholders through the alignment of organizational strategies, business objectives, and the project's goal and objectives. Project governance also reduces goal conflicts among stakeholders, manages risks to reduce project risks, and reduces the different risk attitudes among stakeholders. Project governance functions also include control and communication functions to reduce and prevent information asymmetries among stakeholders. Consequentially, project governance functions can reduce project failure rates and increase project success rates ( Jeong & Jeong 2016; Mahaney & Lederer 2003).

### 3. Institutional Analysis of IT Service Projects

#### 3.1 PROFIT RATES OF IT SERVICE COMPANIES IN SOUTH KOREA

IT service company profits are low in South Korea because of project risks and high failure rates, as seen in Table 1. IT service companies with over \$1 billion revenue earn higher profits compared with those in the lower-revenue groups. The profit rate of a specific IT service company showed little variance during the analysis periods. Profit gaps among IT service companies may arise because of a range of factors, but the profit gap among IT service companies may mainly depend on the application of project governance institutions or project management processes (ITSA 2010–2016).

#### Table 1 Revenue (Rev.) and profit rates of IT service companies in South Korea (ITSA 2010-2016)

The average profit rate of IT service companies shows 2.9%-4%, and number of companies over 10 million USD are 62-112 in South Korea from 2010 to 2015, as seen Table 2.

We analyzed the average operational profit rates of IT service companies with revenue over \$10 million USD, by one-way analysis of variance (ANOVA) for the 2010–2015 periods. We divided the IT service companies into four revenue groups. Revenue Group 1 is over 1 billion USD, Revenue Group 2 is from 0.5 billion USD to 1 billion USD, Revenue Group 3 is from 0.1 billion USD to 0.5 billion USD, and Revenue Group 4 is below 0.1 billion USD. The average profit rates of Group 1 (26 IT service companies) is 8.45%, Group 2 (31 companies) is 4.51%, Group 3 (232 companies) is 3.91%, and Group 4 (297 companies) is 4.49%, as seen Table 3.

According to the results of the one-way ANOVA, the gap of average profit rates of Groups 1 and 2 is statistically significant at a 5% significance level. The gap of average profit rates between Group 1 and Groups 3 or 4 were significant at a 1% significance level. This means that gaps of average profit rates among groups are very rare under a normal distribution assumption, as seen Table 4.

#### Table 3 Average profit rate of IT service companies in South Korea by revenue group

Note: Group 1 (over 1 billion USD revenue), Group 2 (0.5 billion USD–1 billion USD revenue), Group 3 (0.1 billion USD–0.5 billion USD revenue), Group 4 (10 million USD–0.1 billion USD revenue)

#### Table 4 Results of average profits rates by one-way analysis of variance

\* Gaps are statistically significant (0.05 level)

#### 3.2 CHARACTERISTICS OF IT SERVICE PROJECTS

In South Korea, IT service project phases can be divided into bid and contract agreement, contract performance, and contract completion. The bid and agreement stage includes request for proposal (RFP), proposal, negotiation, and contract. The contract performance phases include planning, analysis, design, development, testing, and cut-over stages. After project completion with the acceptance of project outputs, the customer makes the final payment ( Jeong & Jeong 2014), as seen Figure 3.

Figure 3 Project life cycle in banking IT systems (Jeong 2014)

IT projects face various risks that may lead to project delays or cost overruns. In addition, failure to comply with government laws and regulatory body recommendations may lead to legal issues and taint the company's image. Accordingly, project risks should be properly identified and managed. A project risk is an uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives. Project risks can be classified by knowledge area such as time, cost, quality, legal, and suppliers or by stages of the IT service project life cycle, as seen Table 5 ( Jeong, Bae & Jeong 2015; Wideman 1992).

Table 5 Risks in IT service project life cycle (Jeong, Bae & Jeong 2015)

#### 3.3 APPLICATION OF THE IAD FRAMEWORK TO IT SERVICE PROJECTS

This study aims to analyze the effectiveness of project governance institutions to mitigate risks, agency conflicts, and problems among stakeholders that would impact the project success and failure in the IT service project environment. We have studied based on the IAD framework, which consists of action situations including physical attributes, community attributes, and institutional or rules arrangement, model of actors, patterns of interactions, and outcomes.

The physical attributes of IT service projects include a lump-sum contract agreement between the buyer and the supplier. The contract relationship between buyer and supplier is established on the basis of resource dependency theory (RDT) and transaction cost economics (TCE) theory (Muller 2009), as seen Figure 4.

Figure 4 Contract structure of IT service projects (Jeong & Jeong 2014)

An IT service project community includes various stakeholders, all of whom have interrelationships. These include agency relationships between the buyer and the supplier, the project board and the project manager, and the project manager and project team members. There are also contractual relationships that confer rights and obligations between buyer and suppler, as seen Table 6.

Table 6 Rights and obligations of contractors (Jeong & Jeong 2014)

Project stakeholders are the individuals, groups, or organizations affected by, or that affect, the project. As such, it is necessary to document relevant information regarding their interest and involvement. Stakeholders may be actively involved in the project, may be internal or external to the project, and may hold varying authority levels. Internal stakeholders include the project manager, project management team, and project team members; external stakeholders include the project sponsor, project governance board, customer, supplier, regulatory bodies, and PMO

The project governance board is a formal team consisting of executive leaders (or their delegates) from across the organization. Their mission is to direct the organization strategically, using projects to meet organization goals. Some key services provided by the PMO are monitoring and controlling project activities, aggregating and analyzing information, and reporting and making recommendations to the project board (Hobbs & Aubry 2010).

Project governance institutions of IT service projects include the PSC, PMO, and SGP for enterprise risk and contract management.

In the model of actors' behavior, actors can exhibit opportunism and have bounded rationality. Their pattern of interactions in IT service projects can be analyzed using RDT, TCE theory, and agency conflicts (Muller 2009; Williamson 2013), as seen Figure 5 and Table 7.

Note: IAD (Institutional Analysis and Development Framework); PSC (Project Steering Committee); PMO (Project Management Office); SGP (Stage-Gate Process); TCE (Transaction Cost Economics); RDT (Resource Dependency Theory)

### 4. Results of Project Governance Institutions

#### 4.1 OPERATION OF PROJECT GOVERNANCE INSTITUTIONS

We conducted FGI with a total of ten professional project experts, consisting of two or three people per revenue group. Interviews sought information regarding project governance institutions such as PMO, PSC, and SGP. Group 1 showed that a PSC is mandatory, the PMO operates permanently with 20–30 people, and the SGP is crucial to rule setting. The OGC (Office of Government Commerce) has introduced a P3M3 (Portfolio, Program and Project Management Maturity Model). P3M3 can be used to understand and identify the key practices that need to be fully embedded within the organization to achieve the next maturity level. In addition, P3M3 described the Level 1 is an initial process, Level 2 is a repeatable process, Level 3 is a defined process, Level 4 is a managed process, and Level 5 is an optimized process. Also, CMMI (Capability Maturity Model Integration) defined Level 1 is an initial unpredictable process, poorly controlled, and reactive. Level 2 is managed, which is often reactive. Level 3 is defined for the organization, and is proactive. Level 4 is a quantitatively managed process which is measured and controlled. Level 5 is optimizing, which focuses on process improvement (Gonzales Marle & Bocquet 2007). According to P3M3 and CMMI, the maturity level of Group 1 is estimated to be 3-4 due to mandatory PSC and SGP operation, and permanent PMO organization. The maturity level of Group 2 is estimated to be 2-3 because PSC is optional without a permanent PMO; instead, project risks are inspected at project execution stages by 4–7 quality assurance members and the SGP operation is optional. The maturity level of Group 3 is estimated to be 1-2 because PSC is optional when a permanent PMO is absent, but risk inspections occurred at project execution stages by 1–3 persons and there was no SGP operation. The maturity level of Group 4 is estimated to be one because PSC was not available, and it operated without a permanent PMO and also lacked a SGP ( Jeong & Jeong 2016a), as seen Table 8.

Table 8 Status of project governance institutions of IT service companies by revenue groups (FGI)

Note: Group 1 (over \$1 billion revenue), Group 2 (\$0.5 billion–\$1 billion), Group 3 (\$0.1 billion–\$0.5 billion), Group 4 (\$10 million–\$0.1 billion)

#### 4.2 EFFECTIVENESS OF SGP APPLICATION

To verify the effectiveness of SGP in IT service projects, we conducted FGIs with seven experts in different IT service companies. The interview results are summarized in Table 9. Their answers revealed that SGPs were implemented at corporate or division levels. Final decisions were made mainly by project executives according to quality, risk, and performance criteria. The project related information for decisions was reported by the project manager or PMO. We find that the SGP can increase the levels of requirements, quality, time, and risk management. Interviewees also suggested standardizing processes, establishing objective assessment criteria and guidelines, and ensuring flexibility of operation depending on project type and size (Cooper 1990; Jeong & Jeong 2016a).

#### 4.3 EFFECTIVENESS OF PROJECT GOVERNANCE INSTITUTIONS

A total of 109 projects for external customers were completed before the application of the project governance institutions such as SGP and enterprise risk management between 2009 and 2012 in an IT service company. A total of 27 of these completed projects during the same period failed. Therefore, the average failure rate for projects was 24.5% before the application of project governance institutions. However, 72 projects were completed after the application of project governance institutions in 2013–2016 in the same company, and seven projects failed. Accordingly, the average failure rate of projects was 9.7% after the application of project governance institutions. The average failure rate of projects was therefore reduced by 14.8% through the application of developed project governance institutions, as seen Table 10.

These findings lead to the following recommendations:

### 5. Conclusions

In this research, we analyzed the effectiveness of project governance institutions for IT service projects based on the statistical analysis of profit rate by revenue groups of IT service companies in South Korea and FGI about the relationship between the maturity level of project governance and the revenue groups of IT service companies. In addition, empirical study about failure rate change of IT service projects by application of project governance institutions for an IT service company. FGIs and empirical case study show that project governance institution can reduce or eliminate project risks, agency conflicts among stakeholders. We found that such institutions can increase project success rates through a reduction in risks and agency conflicts in agency relationships. Further, we provided recommendations about the application of project governance institutions to improve the project success rate of IT service projects.

### 6. References

Cooper, Robert G. 1990. "Stage-Gate Systems: A New Tool for Managing New Products," Business Horizons 33(3), pp. 44-54.

Crawford, Sue E. S., Ostrom, Elinor. 1995. "A Grammar of Institutions," American Political Science Review 89(3), pp. 582-600.

Dinsmore, Paul C., Rocha, Luiz. 2012. Enterprise Project Governance: A Guide to the Successful Management of Projects Across the organization, AMACOM.

Eisenhardt, K. M. 1989. "Agency Theory: An Assessment and Review," The Academy of Management Review, 14(1), pp. 57-74.

Gartner, 2017. https://www.gartner.com/it-glossary/it-services.

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### About the Authors

 Eun Joo Jeong is a Ph. D. He is adjunct professor in graduate school of PM at Hanyang University and project contract expert at SK Holdings Compnay. He obtained a B.S. in Electrical Engineering at Chosun University and an M.A. in MIS at Yonsei University, Korea. Mr. Jeong has over 34 years of industry experiences in the areas of

IT Project Management, IT Audit, and Contract Management. He has published several papers in the proceedings and journals including Journal of Internet Computing and Services. He was awared the Best Paper Award at ICONI 2016 and the Best Paper Award at KPMA symposium at 2009 and 2015.

 Dr. Seung Ryul Jeong is a Professor in the Graduate School of Business IT at Kookmin University, Korea. Currently he is the president of Korea Society for Internet Information. He holds a B.A. in Economics from Sogang University, Korea, an M.S. in MIS from University of Wisconsin, and a Ph.D. in MIS. from the University of South Carolina, U.S.A.

Professor Jeong has published extensively in the information systems field, with over 60 publications in refereed journals like Journal of MIS, Communications.

 Dr. Chang Wook Kang is a Professor in the Department of Industrial and Management Engineering and Dean of College of Engineering Sciences at Hanyang University ERICA campus, Korea. His research interests and expertise lie in statistical process control and project management. He founded and served as the president of

Korean Society of Project Management during 2010~2012. He was awarded the Hanyang Best Teacher Award 2007, the Hanyang Distinguished Teaching Professor Award 2013, and the Hanyang Teaching Innovation Award 2016.

International Project Management Association Research Conference 2017

2-4 November 2017

© 2018 by the author(s). This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International (CC BY 4.0) License (https:// creativecommons.org/licenses/ by/4.0/), allowing third parties to copy and redistribute the material in any medium or format and to remix, transform, and build upon the material for any purpose, even commercially, provided the original work is properly cited and states its license.

**Citation:** Schoper, Y. 2018. Report from the 2017 IPMA Research Conference on project success. International Project Management Association Research Conference 2017, UTS ePRESS, Sydney: NSW, pp. 1-4. https://doi.org/10.5130/ pmrp.ipmarc2017.6005

Published by UTS ePRESS | http://pmrp.epress.lib.uts. edu.au

#### CONFERENCE REPORT

## Report from the 2017 IPMA Research Conference on project success

#### **Yvonne Schoper**

HTW Berlin University of Applied Sciences, Treskowallee 8, 10318 Berlin, Germany.

**\*Corresponding author:** Yvonne Schoper<EMAIL_ADDRESS>
**Name:** International Project Management Association Research Conference 2017 **Location:** Incheon, Republic of Korea **Dates:** 2nd to 4th November 2017 **Host Organisation:** IPMA-Korea

**DOI:** https://doi.org/10.5130/pmrp.ipmarc2017.6005 **Published:** 12/06/2018

Project success is one of the most researched topics in project management. Many studies tried to find out the ingredients for project success, the so-called success factors and how to measure success, by the help of the so-called success indicators. One question is if these definitions and understandings of success are still valid for the 21st century. Therefore the theme of the 2017 IPMA Research Conference was: "Projects, Management and Success - do we need a wider understanding?"

### About the IPMA Research Conference

The IPMA Research Conference was founded in 2013 and as a Think Tank it aims to bring researchers, experts, scholars and practitioners in project management together who share a common passion for their discipline. During the conference, they discuss and exchange research ideas and achievements on the topic of projects and its management. The distinctive feature of this small in size conference is the intense dialogue between practitioners and academics which can neither be found at scientific or professional conferences. The annual International Conference aims to bring together experts from all countries worldwide to increase the mutual understanding of the global challenges of project managers in various environments and industries. The special spirit of the IPMA Research Conferences can be particularly felt in the World Café sessions where the participants can gain new insight perspectives for today´s challenges in project management.

**DECLARATION OF CONFLICTING INTEREST** The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article. **FUNDING** The author(s) received no financial support for the research, authorship, and/or publication of this article.

### 5th IPMA Research Conference 2017

The theme of the 2017 IPMA Research Conference was "Projects, Management and Success – do we need a wider understanding?" Project management has continuously developed in the last decades like no other management discipline. But although the requirements towards project managers further developed, the definition of success in projects and in project management has remained stable during this time.

Project Management distinguishes between project success (measured against the overall objectives of the project, and a high level of satisfaction concerning the project outcome among the key stakeholders) and project management success (measured against the measures of performance as scope, time and budget). However, success has different meanings to the people as it is linked to culture and values. Success is perceived differently by different stakeholders, and in different areas: the macroeconomic meaning of success differs from the micro-economic, success in sociology is perceived differently than in psychology or sport, and an individual perceives success differently than a group, an organization or a whole society.

The 2017 IPMA Research Conference took place on Nov 2 - 4 2017 in Incheon, Korea. It gave the 60 participants from 13 countries from five continents the opportunity to exchange their understanding of successful projects and their management.

The festive official opening ceremony in the morning of day 1 covered several congratulatory and keynote speeches from the local hosts including Dr. Han Seung-soo, the Former Prime Minister of Korea and UN´s Special Envoy for Disaster Risk Reduction, from Mr. Kyung-seo Park, President of the Korean Red Cross, and Mr. Kyoung-Soo Kim, Member of the National Assembly of Korea as well as from the IPMA president Mr. Reinhard Wagner and the chairman of IPMA Korea, Mr. Won-dong Cho. They highlighted in their speeches the meaning of projects and their professional management for the rise and success of societies like South Korea.

One challenge in the organization of this conference was to bring together the interests of the national Korean-speaking and the international English-speaking participants. The organizers solved this by offering a program that was split in the afternoon into three different streams to fit both needs. One stream was dedicated to the Korean participants, where the speeches from the international keynote speakers got simultaneously translated into Korean and two further streams that were based on the paper presentations that were selected in the 'call for paper' process. These presentations built the basis for the two parallel research streams.

The first two parallel streams covered the topics "Project success and Ethics & Philosophy," and "Project success and Sustainability." The second afternoon streams were about the topics "Project success and culture" and "Project success and value." These twelve papers are included in this special PMRP edition of the Research Conference.

The evening of day one was dedicated to the IPMA Research Awards. IPMA awards every year excellent research in the three following categories: young researcher, researcher, and lifetime achievement award. In 2017 the winners in the three categories were: for the IPMA Young Researcher Award the winner is Ms. Maude Brunet, for the IPMA Research Award the winner is Lavagnon Ika and for the IPMA Research Achievement Award the winner is Jeff K. Pinto. The winners gave presentations on their research studies and encouraged the audience to join in the field of project management research. A further highlight of the award evening was to honour Rodney Turner for his role as chief editor of the International Journal of Project Management and for bringing Project Management research in the last 30 years

to today´s academic recognized high ranked level. The award ceremony was concluded by performances by various Korean artists.

Day 2 started with five keynote speeches from Beverly Pasian, Reinhard Wagner, Carl Marnewick, Won-dong Cho and Jesus Martinez, all looking at the different facets of project success from different angles: from the benefits´ perspective, the journal editor´s perspective, from agile project management´s perspective and from the individual perspective, starting a reflection process at every participant. The morning ended with an interview with Rodney Turner on his own definition and reflection on project success. The afternoon started with two parallel creativity sessions, and one was a Six Thinking Hats workshop facilitated by Haukur Jonasson and one a Design Thinking workshop facilitated by myself. Both workshops dealt with the definition and understanding of project success and gave the participants new insights about the various ways of looking at success from the various stakeholders, a better understanding of the different attitudes towards success, but also about the shades of success. The findings in the workshops were summarized in the final World Café session. In five rounds the following five topics were discussed:

The second conference day was concluded by the common, unambiguous summary of all participants that the current definition of project success is not sufficient anymore given the new constraints as complexity or the need for sustainability in today´s time. However, it is not possible to come up with a proposal for a new definition yet.

The third day of the IPMA Research Conference traditionally consists of an excursion to local project sites that cover the theme of the conference and some sightseeing. The success theme fits the famous Incheon Bridge where the participants learned from the charismatic CEO and project manager Dr. Soo-hong Kim about the challenges of planning and constructing a spanning cable-stayed bridge. Incheon Bridge is the five longest of its type in the world, reducing the travel time between Songdo and Incheon International Airport by one hour. The overall length of the bridge is 22 km. In 2015 the Incheon Bridge project won the IPMA Project Excellence award, and the participants had the opportunity to understand the ingredients of this example project success. In the afternoon the participants visited Seoul and the Gyeongbokgung Palace, the antic quarter of Bukchon and the art district Insadong. The evening ended with a typical Korean barbeque dinner.

The participants again enjoyed the special character of this unique research conference with its possibilities to get to know international project managers, to see local projects and to experience how project management is applied in the various parts of the world. This combination made the 2017 IPMA Research Conference again a memorable event for all participants. Project success and the local application of the conference theme gave the participants the chance to see Incheon Bridge and its project manager Dr. Kim that will remain a landmark for the conference participants when thinking about project success in the future.

The IPMA Research Conference Coordinator thanks all authors and keynote speakers for contributing to the success of the 2017 IPMA Research Conference, the conference stream facilitators for their professional moderation of the research streams, the Korean hosting

delegation of their warm hospitality, the IPMA Research Coordinator Helgi Thor Ingason for his continuous support, Beverly Pasian for publishing the final papers in the new PMRP journal and finally IPMA for making this unique conference possible.

Berlin, February 2018

Yvonne Schoper

**Note:** This report has been adapted from the author's blog post that was published at blog. ipma.world.

### About the Author

 Dr. Yvonne Schoper is Professor for International Project Management at HTW University of Applied Sciences Berlin. Dr. Schoper holds a BSc in Engineering Management, an MSc International Business and a Ph.D. in Industrial Engineering. She worked as a project manager for BMW where she was responsible for several international automotive

development projects in USA and in Germany. Since 2009 she is associate Professor for Project Management at the Tongji University in Shanghai (China).

Her research interests are intercultural project management, future trends in project management, women in project management and the further development of the profession of project managers.

From 2012-2015 she was Executive Board member of GPM Germany where she was responsible for research. Since 2015 she is the delegate of Germany at IPMA´s Council of Delegates. Since 2016 she is member of the Presidential Advisory Board of GPM.

#### **IPMA Research Conference 2017 – Review Process**

The paper review process for the IPMA Research Conference 2017 was a three stage process.

The first stage was a double blind review by the jury members of the IPMA Research Conference Steering Committee, all international academics none of them being a member of PMRP. All 28 short paper submissions went through this initial review process. In this phase the papers were reviewed using recognized academic criteria (quality; relevance; new or emerging knowledge; applicability) and were ranked in two categories:

17 short papers were accepted based on these criteria and the authors got invited to submit their long papers for the Research Conference.

In the second stage 14 long papers were presented at the Research Conference and received feedback from the eight research stream facilitators (all academics).

In the third stage the papers were ranked by the editor of the PMRP journal into the categories:

In addition each author received a detailed feedback to his long paper in a second double-blind review process from two independent external academic reviewers. This review process was steered by the editor of the PMRP journal, Beverly Pasian together with the IPMA Research Coordinator Helgi Thor Ingason and the IPMA Research Conference Coordinator Yvonne Schoper.

The resulting 14 papers are published as an eJournal by PMRP. There was no funding by any organization involved in the whole process.

The IPMA Research Conference Coordinator thanks all authors for contributing with their paper submissions to the success of the Research Conference, all reviewers for their constructive feedback to the submissions, the conference stream facilitators for their professional moderation of the research streams, the IPMA Research Coordinator Helgi Thor Ingason for his ongoing support and finally Beverly Pasian for publishing the conference papers in the PMRP journal.

Berlin, February 2018

Yvonne Schoper