Customer Inclusion is Key for Project Success

CUSTOMER INCLUSION IS KEY FOR PROJECT SUCCESS By Course Name Professor’s Name University City, State Date of Submission Customer Inclusion is Key for Project Success Introduction Organizations use projects in a number of ways, including shortening the times in the market, finding solutions to challenges on how to speed up the development of new product in the market, creating new categories of products and achieving the goals of the company. Effectively deployed projects majorly concentrate on the priorities and needs of customers through the organization of a firm’s internal resources in a dynamic, efficient and flexible manner. Projects are important for companies because of their potential to contribute to a company’s survival, profitability, and expansion, especially in the global business environment that has increased competition. The global business environment is rapidly changing, and in turn, it has affected the way companies make decisions. The traditional strategies and policies set by companies are ineffective in the current environment due to the uncertainty and turbulence of the business world. In fact, some decisions made by organizations in the current environment can only be applied temporarily to solve a certain problem, which might not reoccur. Therefore, businesses need to adopt new ways of maintaining their competitive edge. For this reason, projects have become more popular with businesses. To counter the cross-functional development, shortened product life cycles, high rate of technological obsolescence and complex challenges within an organization, firms have adopted various project management strategies. As a result, a large number of projects have been initiated over the years in several countries. High-value capital goods (CoPS) play a significant role in the global economy and industrial growth. These products are defined as highly expensive engineering and software-intensive goods, engineering constructs, systems, infrastructure and networks that contribute to economic growth (Davies and Hobday 2005, p. 6). The development of CoPS is highly profitable for countries and for this reason, most developing nations are adopting such goods to boost their growth. However, over the recent years, several high-cost projects have been unsuccessful due to the challenges involved in managing such projects. Majority of the failed projects lacked good strategy and a proper understanding of the entire scope to develop the necessary management tools to accomplish the projects. However, the challenges not only apply to CoPS companies, but to the entire project businesses. High-cost goods and services rely on the customer’s preferences, which means that the consumer is actively participating in the project. To ensure that the customer is completely satisfied, businesses need to employ other services such as training and consultancy. The involvement of customers in the creation of products cuts across both capital and consumer goods as the needs and preferences of consumers are constantly changing. Aside from that, companies should also constantly improve their management strategy to cope with the changing environment. However, the capabilities of a company determine its ability to complete the project as per the specifications of the customer. Companies that have diversified capabilities easily develop new knowledge and skills that enable them to plan, organize and utilize the available resources to produce satisfactory high-cost products and services as well as successfully complete complex projects that meet the requirements of the customer. Dynamic Capabilities Dynamic capabilities are the processes of strategic innovation implemented by organizations to adapt, integrate and reconfigure their external and internal routines, resources, and competencies in response to the business environment that is rapidly changing (Brady and Davies 2014, p. 24). Dynamic capabilities are therefore important for a company’s survival, growth, and competitiveness. The dynamic capabilities of a firm are based on two theoretical perspectives (Gann and Salter 2000, p. 957). One is the resource-based view, which focusses on two perspectives. The first perspective is that of strategy, technology, and company performance. According to this perspective, dynamic capabilities were implemented to extend the theory of resource-based view by proving how companies deal with the fast-changing business environment by integrating and reconfiguring their external and internal resources. The second perspective is organizational design and contingency, which influences the dynamic capabilities of a company depending on the uncertainty of the market environment and the degree of change. The other theory is the evolutionary theory, which is also called the ‘dual-routine framework’ (Davies, Dodgson and Gann 2016, p. 28). This theory claims that dynamic capabilities are strategic processes of higher order, which are used to create operational capabilities of a lower order. In this case, operational capabilities are the predictable and stable activities performed by a company through the production and selling of goods and services. Aside from the theories, there are other dynamic capabilities that companies can implement to support the strategic management of complex projects. An example is the three-phase process of learning, codifying and mobilizing (Davies, Dodgson and Gann 2016, p. 32). The learning phase involves assessing the company’s current routines and capabilities of handling future challenges. The codifying phase involves designing dynamic capabilities, which can be expressed as formal mechanisms, structural principles and simple rules to promote possible actions in different circumstances. The mobilizing phase involves providing support and promoting the managerial actions necessary to curb the conditions that are uncertain or even those that are stable. To better understand the effectiveness of the three-phase process, it would be necessary to evaluate the case of the T5 project. The project, which was part of BAA, was purposed to expand the existing T5 airport, starting from its initial planning in 1986 to the start of operation in 2008 (Davies, Gann and Douglas 2009, p. 107). The project was of high risk to the company since any mistake would have led to bankruptcy and therefore, it was necessary for the organization to take proper measures to successfully implement the project. By implementing the learning phase, BAA recognized the need for the uncertainty of the project and initiated various changes to the project. Through the implementation of the second phase, the company used the knowledge gained from the learning phase to create the T5 agreement. The agreement incorporated procedures, structures, and principles which were meant to help managers solve various challenges that arose from the different conditions of the project. The mobilizing phase involved the actual practice of the policies and procedures stated in the T5 agreement. The implementation of the three phases ensured successful completion of the project by creating a flexible environment. The flexible environment was meant to suit the needs of the customer. Since the customer influences the market, it was best for BAA to adopt the three-phase process to meet the needs of the consumer. Project Management Capabilities Performance and Strategies As stated earlier, organizations use projects to achieve their strategic objectives and improve operational effectiveness. The resources owned by an organization together with the company’s capabilities are important in ensuring growth as well as ensuring that the company is competitive. Aside from implementing projects to improve company performance, organizations also use projects to implement corporate strategies to venture into new technological fields and markets (Davies 2004, p. 730). Organizations are limited to improving their market base and technology due to the improved productivity that is triggered by the increased specialized use of the current resources. However, it is necessary for companies to adapt to new technology and redeploy its resources for the future benefit of the firm. This means that companies need to acquire knowledge and skills on how to conduct research, productive activities and developments that coincide with a specific technological field. Also, organizations should be able to respond to their customer’s needs through good customer relations. The dynamic interaction between a firm’s market base and technology are important features that contribute to growth. However, these interactions are based on the need to meet consumer demands. Through customer intimacy, companies are able to gain more knowledge concerning their customers and in turn, lead to the operational flexibility that builds loyalty and business. (Crawford 2011, p. 3) Through the mobilization of resources and acquiring new knowledge, companies are able to identify gaps in the market based on consumer preferences and venture into new markets. A firm can be considered to have distinctive capabilities when they are able to come up with a unique source of competitive advantage, which is unavailable to other competitive organizations. Companies that are able to develop appropriate capabilities necessary to conduct certain industrial tasks in a particular market base or technological field also have more advantage over their competitors. Nonetheless, the internal capabilities of companies are highly influenced by the external environment. This would mean that a change in the environment will affect the routines of the company and in turn, affect its capabilities. Changes in the environment can refer to increased competitiveness or change in cu...