The Investigation of Project Management Practices in Public Sector Organizations: A Case Study of UAE
Chapter 1: Introduction
1.1 Background of the Research
It is beyond dispute that the advent of the advanced technologies in today’s business and industrial domains has drastically increased the complexity project management practices (Austin et al., 2002). As a result, organizations have been facing unprecedented management challenges arising from these complexities. This has sparked numerous debates in the academic and practical spheres in the bid to establish effective tools and approaches aimed at improving performance and completion of business projects. Moreover, new innovative management practices have been established with an aim of fostering project management effectiveness in both private and public organizations.
The present world business environment is characterized by powerful driving forces, such as globalization, financial markets, economic integration, and the tendency to remove all barriers to free global trading mechanisms, as monitored and regulated by the World Trade Organization (WTO). However, the rapid advances in information and communication technology (ICT), such as web-based and cloud computing applications have introduced powerful media, which have pushed further the project of making activities take place in virtual spheres. The development of new innovative management approaches has changed the traditional landscape of the business activities to be webbed by complicated business relations to form different multinational patterns of business strategy and alliances for executing mega-projects worldwide. In the present complex business environment, an organization should respond positively to the emerging challenges. This means that the organization is always expected to be both reactive and proactive towards the new challenges and threats triggered by its internal and external conditions (e.g., physical, socioeconomic, or political issues).
Among the key challenges faces project management practices in organizations include the advent of new technologies and methodologies, market competition, and changes in stakeholder expectations. Nowadays, projects have become widespread organizational structures, which pave the way for the emergence of a new form of organization, namely the project-based organization, whose core business components are project related activities.
Tjahjana et al., (2009) argue that the complexity of such a business situation has led to unfavourable challenges being created for many project-based organizations, which find it hard to handle their business projects in a proper and professional manner. Among these challenges are the following:
- a) Scarcity of resources – Every organization, regardless of its core business activities, faces a shortage in one of its vital resources, such as professional human resources, financial funding, efficient management approaches, etc. Therefore, the organization must effectively distribute its available resources between its projects to avert such limitations.
- b) Inconsistency in the management process – Inconsistency is usually found in an organization whose management capabilities are still immature; hence, it fails to manage parallel projects effectively, or to measure their actual performance.
- c) Lack of coordination between various projects – The inefficient coordination between multiple running projects usually causes a vital disruption in the execution of these projects, yielding poor outcomes. Accordingly, an organization may face bankruptcy.
- d) Improper selection of projects – Many organizations find it hard to select projects that are aligned with the organization’s vision and strategic plan. When this happens, improper project selection causes the organization’s crucial resources to be dissipated. Many organizations that deliver products and services in a project-based form have increasingly introduced a new integrated organizational entity known as the Project Management Office (PMO). Unlike conventional project management practices, which adopt traditional methods in planning and execution of projects where each department works independently, PMO is a specialized group whose role is to set, maintain, and ensure standards for project management within an organization. While traditional project management practices are leveraged on lean methodologies, PMO adopts agile strategies in order to deliver value to stakeholders. The PMO emerged as a new concept of project management (PM) practices and also a business strategy to support innovatively the execution of the organization’s business plans by integrating managerial and operational activities (Ghezi, 2013). Thus, the implementation of the PMO has become a global business phenomenon and growing trend in the way the organization proposes its objectives and strategic goals (Karayaz&Gungor, 2013).
The impetus for introducing the PMO within the organization is often a desire to improve the management of projects and at the same time to reduce the number of running projects that fail to meet the expectations of customers and stakeholders due to budget overruns or unacceptable delays (Karayaz&Gungor, 2013). Therefore, the existence of a PMO has become necessary for organizations in both the public and private sectors whose core activities are project-based. Because the PMO unit can interact actively in the host organization with a project and a business environment, it is responsible for improving the project management capabilities of the host organization; although in the business environment, it is responsible only for liaising between the business partners and the project participants (Tjahjana et al., 2009).
A PMO system can be integrated in the entire organization where it appropriately serves as the organizational support system for various functions within the organization. Therefore, the PMO fosters efficiency in operations of portfolio project management (PPM). Due to the agility and integrative nature of PMO, it enhances cohesion in the implementation of projects within the entire organization, and this contributes positively towards the overall success of the organization. Through the establishment of a PMO unit within project-based organizations, meeting the urgent organizational need is facilitated and this contributes towards the improvement of the managerial performance in executing multi-projects. This is made possible because resources are optimally allocated and utilized, and supports the coordinated operation of these multi-projects in order to achieve the strategic goals of the organization.
A thorough review of the PMO-related literature allows three common models to be extracted of the functioning of the PMO. The first model focuses on direct assistance in developing functions, systems, methods, and tools for the implementation and execution of individual projects or programmes in the parent organization. The second model the PMO functions as a centre of knowledge transfer, focusing on consulting, learning, and training activities. The third model is the organizational PMO focusing less on issues of methodology and tools and more on supporting the business development of the parent organization (Mariusz, 2014). Since this dissertation statement is an important guide to the contents of a literature review, the main research concerns in the present study focus on the link between the establishment of the PMO and the successful execution of a public organization’s strategic plan within a particular business environment. It also explores the criteria that could be applied to measure the effectiveness of the various functions of a PMO in a business project. The purpose of the present study is to shed light on the processes by which the functions of a PMO could support public sector organizations in the UAE in executing their strategic plans, and to learn from the previous experience of projects in order to improve continuously future project performance. Reviewing the scholarly published literature is expected to derive a PMO-specific framework model based on findings of relevance to the research questions and hypotheses, and to identify the factors that could keep the developed PMO model sustainable in practice.
The public sector in the UAE has been witnessing rapid changes with the advent of advanced ICT, along with a wide expansion of infrastructure projects as part of the nation’s economic development. Those changes have greatly affected the path of the administrative processes and the way the public sector presents its projects and provision of services to the users, its citizens. The public sector in the UAE is at pains to coordinate with sub-governmental departments, as well as establishing partnerships with private bodies to improve the management of project execution and delivery through one-stop access that avoids managerial conflict within an organization. The public organizations in the UAE are the major players in the economic theatre and therefore enjoy a relative abundance of resources (e.g., financial, political support, and human capital) that should help them to adopt as project management processes some advanced management approaches that were developed and advanced in the Western and such Asian countries as Japan. For instance, despite the boom in construction and related infrastructure projects at the beginning of the 21st century, the incidence of project and strategic management processes among the public organizations in the UAE was low; they seemed not to take project management seriously or practice it properly (Elbanna, 2013).
However, since 2000, major changes have taken place in the UAE public sector organizations; Abu Dhabi and Dubai, in particular, have begun to adopt innovative and internationally accepted standards and practices in their public administration. The recent vigorous expansion in infrastructure and core public utilities and related services has instigated project-based public organizations in the UAE. This emergence of a new form of public organization has led to the adoption of advanced management approaches, which has prompted an intensive study of the practices of strategic management in UAE public sector organizations as they carry out their projects (Elbanna, 2013).
Developing public projects is considered a great challenge. They require much time for the implementation and great ability to manage them, using such typical methods as planning, procurement, monitoring and control. However, these elements are not as effective as the elements used in projects developed by private initiatives (Esquierro et al., 2014). The main problem concerned in this dissertation is the execution of the organization’s strategic plan, and how this execution of the plan to be achieved successfully. The basic hypothesis of this study is that the PMO when properly implemented helps public sector organizations in managing their business projects.
In today’s world dynamic economy, free trade, and active socio-political movements, many countries are foreseeing their forthcoming situations for keeping the momentum of their stability and economic progress. Consequently, the UAE Federal Government is planning to warrant the continuity of its achieved successful socioeconomic growth and state stability. Therefore, the Federal Government proposed a national plan, namely “The UAE 2021 Vision” as a roadmap for achieving national objectives and ultimate targets that would be paving the way for further progressive steps.
With reference to the 2021 Vision, the Abu Dhabi Emirate endeavours to make sure that its achieved success is dynamically continued to form a solid hub for more development and growth. This study sheds light over the plan proposed by the Government of Abu Dhabi Emirate, namely “Abu Dhabi Economic Vision 2030”, in which the Emirate has set broad guidelines and top priorities for the Emirate’s socioeconomic advancements within its Policy Agenda. Moreover, the concerned vision is considered in this study, because some of the project-based organizations that have been targeted in the survey were among the major players in implementing the Economic Vision 2030 (Abu Dhabi Government, 2008).
Considering these proposed guidelines as the Plan’s evaluative parameters, the Abu Dhabi Economic Vision 2030 has been composed in the consultation with the private sector as an active partner. The Vision 2030 is considered as a 22-year strategy to accomplish the target objectives, and to make sure that all the stakeholders in the Emirate’s economic paradigm is being active in harmony, with the intention of reaching the long-term goals.
The Policy Agenda 2007/2008 of the Abu Dhabi Emirate clearly defines a set of the top priorities as a general public policy in the Emirate. These priorities have been proposed in accordance to what the Emirate considers as its core goals, particularly, the citizen safety and sense of security in the society, as well as sustaining a dynamic and attractive free economy. The Emirate has already identified nine areas to shape the future trends of the Emirate in the social, political and economic arenas:
- A large empowered private sector.
- A sustainable knowledge-based economy.
- An optimal, transparent, and regulatory public administration.
- A continuation of strong and diverse international mutual relationships.
- The optimization of the Emirate’s natural resources.
1.2 Problem Management in other countries
Studies have confirmed that application of modern project management methods and techniques has a great effect on public institutions. Arnaboldiet al.,(2014) observed that application of project management strategy in public sector was as a result of pressure on governments to abandon bureaucratic organization in favour of leaner structures. The authors studied the projects carried out at Italian Treasury Ministry using project management methodology and discover that proper implementation of project management concepts and methods will help in avoiding project failure, continuous communication and the definition of project control system. They however stated that, project management methods needed to be modified and specifically tailored towards the needs of public institutions.
In their study White & Fortune (2012) examined the current project management practice in public sector in UK by collecting data from 236 project managers in some public institutions. The study asked the respondents to judge the effectiveness of the project management methods (projects in controlled environments I & II, structured systems analysis and design methodology, the European risk management methodology, in-house project management methods, and RIBA plan of work), tools (critical path method, work breakdown structures, cash flow analysis, Gantt charts, graphical evaluation and review technique, program evaluation and review technique, and strengths, weaknesses, opportunities, and threats (SWOT)), and techniques (cost-benefit analysis, decision analysis, sensitivity analysis, implied preferences, and expressed preferences) they had used on the project success. The result of the study revealed that 41% of the reported projects were judged to be completely successful (using time, budget and specification), though some drawbacks were reported. Moreover, the authors suggested that more efforts need to be made towards planning, training, cost estimations, resource planning, and standardization.
Similarly, Abbasi & Al-Mharmah (2000) explored the project management tools and techniques used by the public sector in Jordan by surveying 50 industrial public firms. The study found out that the use of project management tools (work breakdown structures and cash flow analysis) and techniques (cost-benefit analysis, implied preferences, and expressed preferences) among the public-sector companies was considerably low, but when practiced efficiently would result in tangible benefit in all aspects of planning, scheduling and monitoring the time, cost and specifications of projects.
In Nigeria, a study conducted by Olateju, Abdul-Azeez, & Alamutu (2011) revealed that the implementation of project management tools (which include work breakdown structure, critical path method, and project sensitivity analysis), are still not well established in public sector, this results into failure of public institutions and their contractors in performing their duties concerning the budget, specifications and deadlines of the projects awarded. Studies have recognized social and political systems, cultural blocks and lack of financial support as barriers to successful project planning and execution in Nigerian public sector (Idoro&Patunola-Ajayi, 2015).
Establishing a PMO within an organization in the public sector has been considered a potential solution to the problem of carrying out a business project within the context of an organization’s strategic plan, and of minimizing failed projects. Little has been written on the relationship between the strategic plan of public sector organizations and the known roles and functions of the PMO.
The importance of having a PMO within a public organization is reinforced by the need to exert greater and more efficient control over any organization’s projects. When several on-going projects run simultaneously within an organization, the creation of a PMO becomes an essential hygienic factor rather than an extravagance. The PMO helps both project managers and host organizations to understand and apply professional practices in their project management (Klein, 2015). Given the way the public sector in UAE has been facing significant changes over the recent years, the need for PMO in the sector has been evident.
1.3 Problem Statement
Over the past 10 years, the UAE has witnessed a dynamic development in the infrastructure projects, in particular in Abu Dhabi and Dubai Emirates, which are becoming two of the most attractive business hubs in the region. Several mega-projects exemplify the progress of their economic development and infrastructure, including the construction of the world’s tallest building (Burj Khalifa) and largest shopping complex (Dubai Mall), and numerous artificial islands, such as Yas Island, Palm Dubai, and a largest artificial archipelago The World.
In addition, the UAE has an expanding manufacturing base with advanced materials and energy technology, oil industries, and machine and automotive industries, all of which help the UAE to contribute significantly to international business. Recently, Dubai won the competition to host EXPO 2020 to entail a great expansion of infrastructure projects activities. Despite the execution of all those megaprojects, the PMO is rarely to be seen in many project-driving organizations where it should feature. Therefore, the immature practical experience of the PMO, particularly in the UAE public sector is considered a challenge facing proper methodology for completing a project.
This lack of PMO experience has raised strong interest in the researcher to conduct the first research study investigating possible roles for the PMO in following strategic plans by public project-based organizations in the UAE. The PMO could provide UAE-based organizations with a bundle of managerial functions and services ranging from furnishing standards to advanced executive management skills to bring to the organization’s projects (Kutsch et al., 2015; Muller, Aubry& Shao, 2013). The concept of the PMO’s maturity level and effectiveness has recently been introduced to both the academic and professional communities. Potentially, the PMO has a higher level of effectiveness and positive influence on organizations as it grows older. To ensure that an organization setting up a PMO invests enough resources, it should understand whether a higher level maturity in the PMO could result in improved organizational performance (Muller, Aubry& Shao, 2013).
Given these gaps and challenges, this study aims to gain some insight into the PMO’s specific roles in helping a public sector organization to execute its ultimate strategic plan through developing frameworks for improving the effectiveness and maturity level of the project’s management. This study speculates on the key roles of the PMO in executing the strategic plan of a public organization in the UAE. It attempts also to tackle the challenges that might interrupt the core functions of the target organization, and to show how the PMO could be effective in the long-run.The study investigates whether a PMO contributes significantly in developing an effective project management to enhance the execution of the strategic plan in terms of the project success. AT-Kearney (2015) suggested seven factors that determine the success of PMO, which include change and stakeholder management, tools and framework (resources management), documentation, progress controlling and quality, risk management, training and capability training, and change and stakeholder management. The purpose of this quantitative and exploratory study is to examine relationships between the seven factors of the PMO framework designated as independent variables, and the execution of the organizational strategic plan designated as a dependent variable (Nakamura &Oshada, 2013; Shretton, 2013; Zulch, 2014).
However, project management in the entire Middle East have being facing series of setbacks which include among others time delays (Al-Kharashi & Skitmore, 2009) and poor cultural inclusivity issues (Dadfar & Gustavsson, 1992). In order to establish vibrant PMO within an organization in the public sector, which is considered as a potential solution to the problem of carrying out a business project within the context of an organization’s strategic plan and minimization of failure, wide research was conducted. This included a review of several academic studies which were conducted with the aim of critically analysing determinants of project success in countries like China (Ling et al., 2009), Vietnam (Ling and Bui, 2010), and India (Iyer and Jha, 2005; Ling and Hoi, 2006) among others.
However, limited or no similar studies have been done yet for UAE and also there was absence of identification of a broad investigation on the challenges faced by PMO’s in managing projects in the Middle East. This study, as stated in the Aims of the study, will investigate how PMO unit could contribute significantly to success of a strategic plan execution in UAE, with a view of providing observations to support the achievement of successful projects management in UAE.
Another area this study will attempt to address is the lack of master plan by some project managers. It is very interesting to note that people always wanted to see projects executed even if the project is in the wrong direction. This is because some influential people with political connections often give out contracts or services to the people of their choice successfully. Employees responsible to execute the work would try to exhibit a sense of responsiveness and they will start the work with little or no plan.
In addition to the above, projects pre-construction planning seemed to be poorly executed in many construction projects in developing countries, especially in the public sector (Baldwin & Bordoli, 2014). In some instance, a particular project was concluded within a year that may not be needed until the next year, the project that was concluded earlier now needs to be upgraded to meet a change in design and structure. This has demonstrated a poor phasing and resourcing, because many critical activities that have fallen behind schedule and the resources could have been used to construct the first project. This has illustrated poor project control because now that the project needed upgrading, it will amount to the use of additional resources to execute the work.
Frequent scope changes, often orchestrated by influential affluent clients, who often prefer unique and exceptional project designs, necessitated the introduction of new features and designs. As a result, inexperienced managers are compelled to work under intense pressure, which would adversely affect the realistic completion of projects within the planned schedules. The above identified gaps were aimed at proffering solutions to project management, because project management in its definite terms, is all about effective utilisation of available resources for successful completion of a project.
However, it is important to understand if these areas mentioned in this study were critically investigated to address the PMO’s lack of experiences and also to address other areas that needed to receive the necessary attention of PMO’s, failures of PMO’s in the aforementioned aspects would be addressed.
1.4 Aim of the Research
The major motivation for choosing this topical theme was that little thorough research has investigated whether a PMO unit contributes significantly to success of a strategic plan execution. Thus, the aim of this study is to enhance understanding and knowledge on these issues for the sake of those involved in project management. This study also aims to design an effective and functional PMO model to address some research issues by examining the interrelationship between the PMO roles in the framework for achieving strategic plan execution within the context of public project-oriented organizations.
1.5 Research Questions
Research-related questions are important since they serve as a blueprint for meeting the needs of the research design and established research objectives. Before implementing a PMO unit in a project-based organization, some questions are usually raised, such as whether the PMO fulfils the organization’s needsand whether the PMO fits the organization’s goals and strategic objectives. The researcher proposed three research questions to drive this study for meeting the stated objectives; these questions are as follows:
- What are the roles of PMO in project execution in UAE public sector organizations?
- What is the relationship between PMO and project execution in UAE public sector organizations?
- What is the appropriate model/framework for the project management practice in UAE public sector organizations?
1.6 Research Objectives
As project-based organizations have become more aware of the importance of project management approaches and tools, they have acknowledged a need of a systematic method of the implementation and support for project management applications in practice. However, many public organizations in the UAE are treating the project execution as a business strategy and tool in market competition. Moreover, many mega-companies (i.e., intercontinental) have made their way to the Emirate project market and brought a range of management applications and tools. Among these applications was the PMO, which represents a welcome, if little studied, trend in project management.
The objectives of the present research are to investigate which-of-which PMO roles are involved significantly in the successful execution of public organizations’strategic plans when they engage in project business. Many scholars have studied the functionality of the various PMO roles in different business conditions. The following objectives were proposed to fit with the research issues investigated in this study:
- To investigate the roles of PMO in project execution in UAE public sector organizations.
- To find the relationships between PMO and project execution in UAE public sector organizations.
- To develop new model/framework for the project management practice in UAE public sector organizations that shows the most influential factors of a successful PMO among the seven factors investigated in this study.
1.7 Significance of the Study
The rationale for this study stems from the need for organizations in the UAE public sector to use more effectively state-of-the art project management approaches and methodologies. They should gain more professional knowledge than what can be generated as lessons learned from past successes and failures, since project managers and PMO leaders are important to carry this knowledge from one project to the next.
The significance of this study is twofold. First, it is intended to contribute to the literature on project management approaches by identifying the actual problems facing the execution of projects as part of an organization’s strategic plan, andselecting appropriate roles for PMOs in supporting plans in process of execution. Second, this research may show PMO managers what their peers are doing to facilitate cross-project learning and their associated challenges. This information may help them to improve project management practices. The project managers, stakeholders and the like of the professional community are looking for reliable standards and guidelines to help their organizations in establishing and maintaining effective PMO units, while the academic community islooking for theoretical bases that could be used to expand the body of knowledge related to PMOs (Pamsel & Wiwiora, 2013; Pierce, 2013a; 2013b). The findings from this study will, it is hoped, help to reduce gaps in knowledge by offering practical perspectives for executiveswho used the PMO models in their work.
1.8 Thesis Outline
This dissertation consists of five chapters; each chapter is devoted to cover a specific area of the study and to cover the topic of research interest. The structure of the dissertation text is designed as follows:
1.8.1 Introduction and overview
This topic is discussed in chapter 1 were it provides a brief account of the PMO, the foundation and background of the study theme, a statement of the research problem, the nature and methodology of the study, research questions and related hypotheses, the rationale and significance of the research topic. The nature and characteristics of the UAE business environment are highlighted.
1.8.2 Review of related literature
In academic writing, literature review comes under chapter 2 were the chapter focuses on the scholarly works related to the topic and theme of this study. The literature review begins by presenting a brief account of the evolution of project management as a discipline and its significance in academia and business. This chapter also covers the historical background of the PMO and seeks to shed light on the roles and functions of the PMO and related entities in improving management approaches and its maturity in executing the organization’s projects.Other related works on the portfolio and strategy of organizations for business projects are considered. Thus, the chapter argues that the project management is responsible for providing tools, templates and procedures for assessing the process of project execution and outcomes and also, through appropriate project management methodology, for determining the factors involved in the success or failure of a project.
1.8.3 Research methodology
This chapter discuss the conceptual design of the model framework is based largely on the relationships between the roles of the independent variables and the dependent one within the context of PMO theories and applications. This chapter will also describe in detail the research design used in this study. It positions it within a quantitative framework, and justifies its use in investigating what roles are possible when executing the strategic plan of a public sector organization. This chapter assesses the data analysis of the pilot survey to find the strengths and weaknesses online before sending it to target participants. Multi-regression is used in analyzing the data collected from them, which later contributes to the conceptual framework.
1.8.4 Data analysis
Data analysis is done under chapter 4. This chapter presents the findings generated from the statistical analysis of the collected data, which will be both qualitative and quantitative collected from the public sector in UAE. The data will be collected from interviews and surveys conducted in the research sample. SPSS software will be used to do regression analysis, while qualitative data will be analyzed using thematic analysis. The data cover the demographic description of the respondents and the PMO, along with tests conducted on the reliability of the dependent variable (taking strategic plan execution as a criterion) and the independent variables (PMO roles as predictors). Validity andmodelling are tested by applying both multiple and simple regression analyses to highlight the established reciprocal relationships between the criterion and eachpredictor.
1.8.5 Discussion, Conclusion and recommendations (Chapter 5)
Discussions, conclusions and recommendations were done under chapter 5. The chapter discusses the tested and validated findings of this explanatory study. It focuses especially on explaining the interrelationships found between the independent variables (the PMO roles) and those between each PMO role and the dependent variable (strategic plan execution). Such relationships would indicate how far each PMO role is involved in the plan’s execution. Moreover, this involvement could help to decide whether each PMO role was either strategic or tactical, and to sort out the PMO roles in accordance with each one’s level of effectiveness. The dissertation closes by highlighting the consistency of the generated findings with the proposed research questions and hypotheses. The findings are compared with existing empirical studies in the PMO domain (such as Aubry, Hobbs, Hill, etc.). The researcher in his recommendations seeks to use the significant results of the project business in practice. Recommendations for further studies are made to fill the knowledge gap in the PMO literature, in particular, the possible role of the PMO in sustaining the phases of the strategic plan.
This chapter has introduced the research context, where the key background information on the research subject, problem statement, and research aim have been brought into focus. Further, the research questions and objectives that would guide the researcher throughout this study were also presented in this chapter. In addition, the rationale and significance of the research for conducting this study was explained, where the key motivations and reasons for conducting this study were pointed out. Moreover, the structure of the current dissertation was presented where the various chapters that constitute it were illustrated. In the next chapter, a critical review of the relevant literature based on the research questions and objectives would be conducted. During the review, research gaps would be identified, which forms the basis for investigation in this study.
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