Factors influencing project success
The study by Salazar-Aramayo, Rodrigues-da-Silveira, Rodrigues-de-Almeida, and de Castro-Dantas, (2013) aimed at finding out the factors that influenced exploration and production project management success at Petrobras S.A. the study focused on seven hypotheses to identify the reasons for the success of the project as influenced by different factors. The first hypothesis aimed at identifying whether training, experience and good internal communication influenced project planning and control. The second objective aimed at identifying whether a coordinated team, with experience and good internal communication influences the project success. On the other hands the third objective focused on a coordinated team with skills and experience influences the quality of the scope of the E&P project. The fourth objective focused on the quality of the scope to the success of the project in oil and gas. The fifth hypothesis on the other hand focused on the effect of adequate planning and controlling of the E&P project on managerial success (Salazar-Aramayo et al., 2013). The sixth hypothesis focused on the positive effect of E&P project planning and control. The final hypothesis focused on the implication of the success of the project to the company financial performance. From the study it was evident that a well-developed team with good communication influences the scope of the project. Scope development depends mostly on good communication, knowledge and experience of the teams' members. Without experience and knowledge, it is highly likely that the scope would not reflect the project proposal and execution process. Besides, without good communication, it is highly likely that project execution will not be done adequately and the result will be poor planning, poor management of task and poor outcome. The success of this hypothesis and objective at Petrobras S.A. was achieved only based on their project management framework. At Petrobras S.A. project development and execution program (PRODEP) is utilized (Salazar-Aramayo et al., 2013). This framework offers approved guideline by which project management systems are applied. PRODEP is linked to supply chain and it is made up of several stages connected by gates. This framework is designed in such a way that the project is approved, monitored and reassessed. The framework also combines the management guideline from PMBOK to ensure that the project is executed and completed within the set time thus reducing costs surges associated with delays.
The study by Ruqaishi and Bashir, (2015) utilized the expatriate knowledge of 59 project managers in Oman. The study aimed at finding out the factors that contribute to delays in oil and gas projects. the study identified major causes of project delays in gulf countries. Among the major courses of delays included poor communication among stakeholders. The challenge of poor communication is that it leads to reworks and delay. In the case of rework and delays, the cost of the project is likely to go up. Similarly to the Salazar-Aramayo et al., (2013), the research suggested that there is the need for the project to have a well-defined and working communication channel so that any information including changes are communicated on time thus reducing the cases of delay and associated costs. It is also clear that in oil and gas industry equipment are made to order. Therefore, without having a good relationship with the vender, it is highly likely to delay the project. There are several high technology equipment's that may be required during the process of exploration and production. Therefore, without having a good working relationship with vendors, it is highly likely to be delayed (Ruqaishi and Bashir, 2015). Therefore, it is important for the project management framework to be integer rated to vendor system such that there can be an easier flow of information and requirement between the project system and important external parties. With a good system between internal and external parties, it is highly likely that the project delays will be solved. That is the same reason why Petrobras S.A. relied on PRODEP system since it creates a link between the project system and vendors thus allowing faster request and delivery of systems (Salazar-Aramayo et al., 2013). Planning and scheduling is another major problem that was identified to cause delays in Oman oil and gas projects. it was identified that most contractors do not create and manage their schedule adequately. Such a problem may be associated with a lack of adequately trained and experienced personnel on board who can assist with such an important aspect. The study however suggested that it is important for contractors to identify proper software packages that can be useful in managing schedules. This study has the same view as Salazar-Aramayo et al., (2013) study, since in the earlier study, it was identified that planning and scheduling play an important role in project success. Therefore, having in place experienced staffs as well as proper scheduling software aid the success of any project implemented. Site management is also very important in ensuring the success of the project. It is evident that poor management of sites results in defects and delays according to Ruqaishi and Bashir, (2015). Poor site management can be controlled by hiring experienced staff to manage the sites (Ruqaishi and Bashir, 2015). Major oil and gas project utilizes the services of subcontractors. It is evident that poor selection of subcontractors may result in delays and defect especially when they do not have the experience required. The study suggests that it is important to select subcontractors based on their previous experience Rather than just costs aspects (Ruqaishi and Bashir, 2015).
In the case of Fallahnejad, (2013) study it was found out that payment delays are a major cause of project delay in Iran. It is evident that most of the oil production facilities and filed are owned by Iran government which has a large financial reservoir. However, delays in payment possess a great danger to the project success. The reason for the delay is attributed to poor management of financial resources. Additionally, most clients are also likely to order additional work which may not have been captured in the original request. Additional requirement delays the project since the schedule needs to be redesigned. Also, there is a need for additional resources which are required to facilitate the execution of the new requirements. Similar to the study by Ruqaishi and Bashir, (2015), it was identified that subcontractor represents a great percentage of delays in most of the projects. similarly, it was identified that hiring subcontractor based on experience rather than cost aspects alone could be a great move to solve the problem of delays associated with subcontracting. The study also identified that most of the projects in Iran run within unrealistic durations. It is ensuring that every task run within adequate time is very important. The best way to create the right duration for a task is by using the information from previous related projects. also, it is very important to use an expert view concerning the project. The expert could evaluate the project complexities, the quality and size of the labor and availability of raw material and give the best judgment by considering variances on factors such as the supply of the equipment. The project of the oil and gas industry also is affected by other external factors such as the need for land acquisition and legal concerns concerning the environment. Therefore, while creating the schedule the effect concerning such external factors need to be addressed. Therefore, the schedule and duration should consider allocating time based on factors that may result from delaying and thus enabling the project to accommodate changes adequately. PMBOK guide offer project management best practices that can be utilized to minimize delays. One of the best practices include modern project management frameworks such as agile and its hybrids offer the best practices that when utilized can offer most appropriate measures to use to reduce delays in project management. For example, an agile method makes it easier to revise the project through the use of iterations. The study by Abdullah, Rahman and Awang, (2011) focused on the three aspects that are used in measuring the project. They include time, quality and cost. The study focused on the problems that are associated with the three factors. Some of the problem, that the study focused on included the schedule, cost, quality, teamwork and benchmark issues. In the traditional project the success of the projects were based on whether it was completed within the agreed time, budget and the quality met the client specification. The study finding suggested that the success of the project depended on whether the client and project team were satisfied with the project processes and its outcome. To analyses the 10 respondent with knowledge and experience in the oil and gas industry were interviewed. The result indicated that allocating sufficient resources to the project is very important for its success. Adequate resources ensure that the project starts and completed on time (Abdullah, Rahman and Awang, 2011). It also provides the avenue through which changes in the projects can be initiated and implemented within the required time thus avoiding further delays. The finding of the study further emphasizes that the quality of the output of the project can be enhanced if each managerial process is evaluated and approved. The reason for such measure is that any defect or error can be identified and corrected on time thus ensuring the client gets the quality they deserve. The study also found out that if the project is completed within the required time frame it is likely to be within the budget and it may be the only way that a company can make profits from a project undertaken (Abdullah, Rahman and Awang, 2011). The study also suggested that collaboration and good communication among the project team member is essential in ensuring project success. Without collaboration and communication, it is highly likely that there will be an omission thus resulting in Poor change management and overall low quality. However with good communication, it is highly likely that an error can be identified on time and corrected. Also, it is very easy for the project manager to manage conflict and get everyone on board to continue delivering in a way that it meets the deadline.
The study by Asrilhant, Dyson and Meadows, (2007) aimed at uncovering the factors that seem to promote successful project management and those that are most preferred by the manager. The study identified that there is a great mismatch between the elements that are known to bring about success to the project and those that receive significant managerial attention. The concept of success in these studies was defined based on four elements including financial success, strategic success, successful completion and management success (Asrilhant, Dyson and Meadows, 2007). From the study, it was identified that internal business operations are the key driver of project success but management only pay attention to a part of those elements. It appears that managers neglect, interdependencies, flexibility, learning and innovation. Managers have the illusion of control and thus they are less likely to embrace interdependencies. It is also evident that most managers are less likely to embrace synergies among project that are running at the same time thus they are not able to learn from each project execution. It was also identified that managers have short tern goals when project management is concerned. Instead, the manager pays most of their attention on financial, geological and environmental factors. However, these factors seem not to carry a heavyweight when the success of the project is concerned. The result of this focus has been identified as the major cause of failure to change in the UK upstream oil and gas sector. Geological, financial and environmental aspect are not always that unimportant but avoidance or inability to implement other there aspect of management as a far-reaching consequence. Therefore, it is important for project manager in the oil and gas industry to consider reevaluating their management style to ensure they consider all the project success determinants (Asrilhant, Dyson and Meadows, 2007). The article suggests that it is high time that the UK oil and gas industry to consider converging the internal factors to financial, geological and environmental aspects to achieve successful strategic project management.
Hannevik, Lone, Bjørklund, Bjørkli, and Hoff, (2014) suggested that organization climate plays an important role in the success of the project. Organization climate aims at getting the bests from the human capitals. Human capital plays an important role in assisting the project to be completed within the deadline and cost. One of the greatest challenges of the organizational climate is that there is no specific dimension that has been identified to influence project success. The project finding indicated that it is very important to have project dimension is a specific context. In general the finding indicated that good communication and cooperation between internal and external actor improves the ability of the project being successful. For large oil and gas company cooperation between the project as well as a project with inline organization plays an important role in its success. This study is concurrent with that of the Asrilhant, Dyson and Meadows, (2007) since both of them include the importance of internal factors in project success. Internal communication and coordination ensure that all the items required as supplied on time to the needed process and thus reducing the delay. It is clear that such technique employs the aspects of both agile and traditional methods of project management. In the traditional method, fewer emphases were placed on the coordination and communication rather most of the emphasis were metered on the process. However, having a complex process with well defined internal coordination, plays an important role in the success of the project.
Hybrid project management combines the technique of both agile and traditional project management. Traditional and agile method has specific differences which were defined to make them function in different situations. For example traditional mostly relies on the process while agile relies on the product and individual. Conflict is a common happening in the project regardless of the industry. The way project manager control conflict in the organization determines the project success. The study by Cahyono and Hartijasti, (2012) aimed at identifying conflict resolution undertaken by project managers in the case of Indonesia oil and gas industry. 57 individual who worked at the engineering, procurement and construction department t were surveyed. Based on different conflict resolution technique, it was found that most project managers preferred combining co-operative and confirmative approaches. It was also found that project managers or surveyed individual in Indonesia case were not effective in applying competitive and avoidance approaches. The result may be attributed to the fact that Indonesia is a country with a high power distance. Thus the way they approach the situation is influenced by the way they perceive the differences in the society. It is clear that in the different country especially where there is lower power distance it is highly likely that a different conflict resolution technique may be utilized.
Hybrid project management and managing complex projects
One of the common difference between traditional and agile project management is their application. Agile project management is applied in smaller projects while traditional is mostly used in large projects. however, both methodology represents different benefits and drawbacks. For instance, agile is best in making revisions while traditional is best in ensuring that the project remains within the scope of the clients' requirements. The study by Špundak, (2014) suggest that combining both methodologies can bring about many benefit top the project including reducing delays and improving its success. However, the study suggests that there is a need to proceed with caution since methodology should be adopted to the project and not the project to methodology (Špundak, 2014). It is therefore, very important to understand the specific characteristics of the project so that appropriate technique or element from both traditional and agile methods can be applied on the project to ensure there is a reduction in delay. According to Owen and Koskela, (n.d.) construction projects have had bad records with regards to success in terms of duration. However, the study suggests that applying agile project management to construction can bring a better share of success which it lacks. The best offer from agile is that it does not focus on the process rather to the individual. Therefore, it is highly likely that agile will ensure there is proper collaboration among construction project stakeholders as well there will be improved motivation among the project teams. The result of such remarkable improvement will result to improve in the delivery of the project outcome. The study by Dikert, Paasivaara and Lassenius, (2016) focused on the success factor of agile methodology and lean in large scale. It should be noted that agile methodology was design for small scale and smaller teams implementations. Therefore, applying it in large scale represent a unique challenge including difficulties in managing large teams. Some of the major challenges that was found to hamper implementation of agile in large scale it is change resistance. There are different way by which people may reject change. One of the way is by flouting the process by suggesting that it bring no benefit. Another cause of resistant was identified as doubting the process. Managers are likely to praise how agile may be useful to their organization and on the other hand deliberately fail to implement it. Also the way the change is implemented influences the result of the process. For instance taking top down approach has been found to greatly result to failure of the process the reason being it destroy any process that will facilitate collaboration to the benefit of the implementation of the new process. Other challenges identified including agile itself as a problem (Dikert, Paasivaara and Lassenius, 2016). For example, it is difficult to understand agile and most people go ahead to implement the methodology which they even do not understand. In large organization, it is highly likely that there will be multiple teams. Multiple team management is very difficult since there are cases where people would prefer to maintain old process.in such cases two system may be running parallel thus resulting in the problem of compatibility. Agile may also require additional engineering and processes which are not available in traditional methodology. Additional requirements comes with additional resources requirements (Dikert, Paasivaara and Lassenius, 2016). Despite many challenges in implementation of agile methodology, it was identified that the success of the method implementation as well as the outcome depends on the management support, customization of agile model, mindset alignment and coaching. Most of the people believe agile is difficult or it not effective for construction or oil and gas industry. However if they change their mindset and work based on its requirement, it is highly likely that they can get the benefit it offers. Besides agile is mostly used in software industry. Therefore, to use it in other industry, it is important to customize it to reflects the needs of the new industry. Customization would also assist the employee in a ne industry to associate with it since they will feel it is more adaptable. More so, it is important for the company implementing the new methodology to train the employees. It is new thing in the company and it is likely to impact how each employee or project team member works. Therefore ensuring that they have adequate knowledge about its operation is very important for its success and general outcome.
Research gap
One of the major research gap identified is lack of more information concerning agile application in oil and gas industry. Agile project management methodology has been successfully applied mostly in software industry. However, they are less utilized in oil and gas industry. Besides, use or development of hybrid project management methodology which uses both traditional and agile project management is not well developed with regards to many industries. More so, there are no many studies that aimed at identifying project management success factors in oil and gas industry especially in gulf countries.
References
Abdullah, A., Rahman, H. and Awang, M. (2011). Identification of the Major Project Management Issues in Oil and Gas Industry in Malaysia.
ASRILHANT, B., DYSON, R. and MEADOWS, M. (2007). On the strategic project management process in the UK upstream oil and gas sector?. Omega, 35(1), pp.89-103.
Cahyono, A. and Hartijasti, Y. (2012). Conflict Approaches of Effective Project Manager in the Upstream Sector of Indonesian Oil & Gas Industry. The South East Asian Journal of Management, 6(2).
Dikert, K., Paasivaara, M. and Lassenius, C. (2016). Challenges and success factors for large-scale agile transformations: A systematic literature review. Journal of Systems and Software, 119, pp.87-108.
Fallahnejad, M. (2013). Delay causes in Iran gas pipeline projects. International Journal of Project Management, 31(1), pp.136-146.
Hannevik, M., Lone, J., Bjørklund, R., Bjørkli, C. and Hoff, T. (2014). Organizational climate in large-scale projects in the oil and gas industry: A competing values perspective. International Journal of Project Management, 32(4), pp.687-697.
Owen, R. and Koskela, L. (n.d.). AGILE CONSTRUCTION PROJECT MANAGEMENT.
Ruqaishi, M. and Bashir, H. (2015). Causes of Delay in Construction Projects in the Oil and Gas Industry in the Gulf Cooperation Council Countries: A Case Study. Journal of Management in Engineering, 31(3), p.05014017.
Salazar-Aramayo, J., Rodrigues-da-Silveira, R., Rodrigues-de-Almeida, M. and de Castro-Dantas, T. (2013). A conceptual model for project management of exploration and production in the oil and gas industry: The case of a Brazilian company. International Journal of Project Management, 31(4), pp.589-601.
Špundak, M. (2014). Mixed Agile/Traditional Project Management Methodology – Reality or Illusion?. Procedia - Social and Behavioral Sciences, 119, pp.939-948.
