Page 207 - Global Project Management Handbook

9-12 COMPETENCY FACTORS IN PROJECT MANAGEMENT

and the project execution process. It is the sponsor’s role to identify the issues that need
scrutiny and the points of view that are relevant to each issue and to put a project organi-
zation in place that will ensure that issues are addresses as completely and as rigorously
as possible.
Risk management is more than applying a method to identify and analyze risks.
Project organization is an important risk management tool in large, complex projects.
Effective risk management requires that the project organization include the right combi-
nation of participants and that it structures them to ensure that risks are identified and
dealt with effectively. Establishing an effective project structure means identifying the
issues that need to be resolved, as well as the participants with the competence and
resources to deal with them, and setting up a structure that forces issues to resolution.
Aligning participant roles with their particular competencies and interests in the project is
a key element of the design of the project structure and of risk management. As can be
seen from this description, the effective management of anticipated risks in large, com-
plex projects in general and in relational venturing in particular goes much beyond the
steps in the risk management methodology of traditional project management.

MANAGEMENT OF POTENTIAL EMERGENT RISKS

The effective management of anticipated risks actually reduces the number of risks that will
be perceived as being emergent events or surprises. However, despite best efforts, emergent
risks still are likely, and the project organization must be designed to manage them.
Design to withstand and manage emergent risks must be done from a complex sys-
tems perspective. The objective is to build in institutional, organizational, or governance
properties that will increase the chances that responses or reactions will allow survival in
the face of unforeseen events and situations. Control of emergent risks is usually indirect.
In a nutshell, project design must build on the ability to imagine emergent risks early and
to create a stable and supportive project environment, as well as a project governance
framework that can withstand and respond to emergent risk. Several strategies for build-
ing governance properties are discussed below.

ANCHORING THE PROJECT INTO ITS
INSTITUTIONAL ENVIRONMENT

The environment of a large, complex project and the interrelationships and interdepen-
dencies between the project and its institutional context are molded over a long period of
time. Effective sponsors invest considerable time and effort into shaping the project and
its context. There are two important aspect of the relationship between the project and its
context. First, the project is developed, delivered, and eventually operated in an institu-
tional framework composed of laws and regulations. Second, the project interacts with a
wide array of external stakeholders. Each of these must be managed so as to stabilize the
context and make it as supportive of the project as possible.
The results of the IMEC showed very clearly that the anchoring of a project into its
institutional context is one of the most critical aspects of managing a large, complex project.
This is a very active process in which the sponsors are very highly involved. The process is
often very drawn out, taking several years to put in place. The process involves educating
and lobbying legislators and regulatory authorities and possibly bringing pressure to bear
on them. At the same time, the project concept is being elaborated and tested. There is a
coevolution of the project concept and the laws and regulations that make it viable.