Managing Uncertainty in the Project-Based Organization

Abstract

The present study analyses the role of uncertainty management during planning and execution of project-based activities within the project-based organization. The study focuses on an electrification project supplier company.

A literature study was conducted in order to investigate the relationship between uncertainty management and project-based organization's activities. The first part of the study considered various authors in project management and in the project-based organization. The second part studied existing conceptualizations of uncertainty management.

The literature study was conducted through revising scientific books, on-line scientific journals, master's thesis and doctoral dissertations. Complementary and contradicting standpoints were analyzed and followed by a discussion.

Uncertainty management was related to management of risks and opportunities and its characteristics were defined as scope oriented, separable but interdependent, complex and linked to project management. Existing research strives to improve the discipline implementation through to adopting a formal but simple and understandable methodology within the project-based organization.

The study included an analysis of existing methodologies and frameworks for risk management. Available research has neither widely explored the inclusion of an opportunity side, nor extensively developed uncertainty management practices. Based on the findings, a framework for managing uncertainty was developed.

The empirical part of the research focused on a case company and on its relation with the present study's objective. The analysis served for describing project-based activities within electricity transmission line turnkey projects and it's relation with uncertainty management practices. The organization's internal documentation and procedures were scrutinized, interviews with key personnel were conducted, and recommendations were suggested.

The case company proved to have a good knowledge on risk management but required guidance on including the opportunity side. Systematic and harmonized integration of uncertainty management with the planning and execution of project-based activities was needed. An uncertainty management framework was developed and purposed for implementation. Suggestions, framework implementation examples, and inclusion of alternative disciplines for managing uncertainty were highlighted.

The study concluded by suggesting the expansion of uncertainty management to non-project-based activities subject to sources of uncertainty. Application of existing disciplines on the managerial sciences is used for illustrating this proposal.