Project management challenges in cross-national, multi-partner, high-risk, research and technology development projects
This paper addresses the challenges faced toward meeting the extraordinary requirements associated with innovative, high-risk, technology research projects. The presentation takes its paradigms from Research & Development (R&D) projects co-funded by dedicated European Commission (EC) Framework Programmes (FPs), centered on European Union (EU) countries but supporting also international cooperation. First an introduction is given that provides the background and strategic vision behind EC FPs. Then the EC FPs are presented, describing their evolution over time from the days of the 1st FP up to the currently running 6th FP. Following that, the paper addresses specific Project Management challenges in EC FPs, such as managing multi-partner consortia, tackling cultural differences, handling risks due to participants' different business priorities, and dealing with IPR issues; the paper further discusses lessons learned related to research excellence through the five groups of project management processes. Finally, the paper concludes with the authors' views on the importance of leadership skills that the project manager must possess in order to cope with the extraordinary challenges of EC FP projects.
“The nuts and bolts of management […] increasingly consist of guiding and integrating the autonomous but interconnected work of highly skilled people (Argyris, 1998, p85).
The European Union is the result of a process of cooperation and integration, which began in 1951 between six countries (Belgium, Germany, France, Italy, Luxembourg, and the Netherlands). After more than fifty years, with four waves of accessions (1973: Denmark, Ireland and the United Kingdom; 1981: Greece; 1986: Spain and Portugal; 1995: Austria, Finland and Sweden), the EU today has fifteen Member States and is about to complete its fifth enlargement in May 1st 2004 that will welcome Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic, and Slovenia. The European Commission, which embodies and upholds the general interest of the European Union and has its President and Members of the Commission appointed by the Member States after they have been approved by the European Parliament (EFIL, 2003, European Commission), has for many years pressed for a dynamic Research and Technology Development (RTD) policy. Such a policy was the direct outcome of the realization of the fact that results from R&D are the basis for the innovation that fuels economic growth, which in turn underpins current and future prosperity of a society and its citizens. More so, EU could take advantage of the single European Market only if it could combine research resources in certain key areas and priority technologies in order to face emerging challenges (EU online, 2001). However, it soon became evident that hardly any company or research team/laboratory could reasonably claim to be able to face these challenges single-handed. Even entire Member States found it difficult to be active and play a leading role in the many important areas of scientific and technological advance, even more so as the development of modern research in a competitive global environment required organizing co-operation at different levels, coordinating national or European policies, networking teams, and increasing the mobility of individuals and ideas (EU Research, 2003). As a result, the need for determined actions at the European level to overcome the fragmentation of Europe's efforts sparked the idea of a multi-national, multi-partner consortium collaborative R&D Framework within Europe with the aim to:
- Develop in an early stage technologies and system architectures characterized by high technological risks.
- Stimulate a quick know-how transfer from fundamental research results to the industry.
- Reduce risk in pre-competitive medium and long-term research.
- Develop a technical base for standards that is harmonized among relevant partners.
- Make field trials and demonstrations characterized by high uncertainty and involving all interested parties.
- Perform R&D for applications using test-beds for new risky enabling technologies.
- Provide a convenient Europe-wide framework (legal, financial, administrative) for collaboration.
The above framework would have to support a long-term vision for society by addressing both innovation and socioeconomic development aspects. It would also need to be able to sustain a high pace of development by achieving a broad adoption of collaborative programmes supporting this vision through dedicated research funding schemes. The culmination of those ideas became the EU Framework Programmes that are presented in the following section.
The EU Framework Programmes
A fundamental notion that the EU realized in order to pursue its aggressive deployment of its RTD policy, was the principle of subsidy - in fact, EU RTD displayed “subsidiarity” long before this term became so important in EU affairs (IRC, 1999). The EU subsidy for project proposals was materialized within dedicated and well-defined frameworks, the so called “Framework Programmes”: multi-annual programmes defining EU RTD policy, priorities and the overall budget to be allocated in each technology sector. The FPs were conceived in order to address the fact that implementing high level research is increasingly complex, interdisciplinary, costly, and "critical mass"-demanding. The critical mass aspect was further supported by enabling companies, which are normally competitors to be partners in research. As an example, in the latest implementation of the FP series, subsidy for projects that are successfully accepted can go as high as 100% of the total project costs, thus directly reducing the R&D costs (and in some cases even zeroing them) and fuelling research initiatives. Additionally, the Framework Programmes:
- Get companies involved in standardization activities as early as possible thus giving a competitive advantage for product development,
- Ensure active support from local governments for business operations, as well as areas as education and staffing,
- Provide a direct link into the European knowledge infrastructure (universities and research centres), and
- Give a non-European corporation the opportunity to be accepted as a “European” company by working closely with European partners and present/future customers.
The series of the FPs started in 1984 with the First FP that lasted till 1987, followed by the Second FP (1987-1991), Third FP (1991-1994), Fourth FP (1994-1998), Fifth FP (1998-2002), and currently the Sixth FP (2002-2006). Exhibit 1 (EC Research DG, 2003, p3) illustrates the change of priorities per thematic research area in terms of funding percentage per every FP's total budget – as a reference point, the total budget allocated to FP6 is approximately 17 billion euros (EC FP6, 2002):
Exhibit 1 – Budget allocation percentage of each thematic research area per Framework Programme (EC Research DG, 2003, p3)
Although eligible participants in the latest Framework Programme are legal entities (i.e. research institutes, universities and industry, including SMEs, but also individual researchers) from any country in the world, the main thrust in terms of funding/subsidy is directed towards the European Union Member States, Associated Candidate Countries and International organizations of European interest. This effectively extends the impact of the Framework Programmes beyond the EU borders and addresses the EMEA region and even goes beyond that.
Project Management challenges in EC FPs
The EC FPs possess certain attributes that can be very challenging for the project manager (PM) who faces them unprepared. First of all, there are two distinct phases that the PM will encounter: the first phase, which is made up by the proposal preparation, submission, and evaluation stages; and the second phase which is made up by the actual execution of the project, assuming that the project has successfully passed phased one and that it has been found eligible for funding. The remainder of this paper focuses on the challenges faced in the second phase, as it is the phase that the PM gets involved by default, while the first phase can be executed by a person or an organization that has simply experience on preparing EC FP project proposals. However, given the high competition that a proposal faces in order to be accepted, as well as the complex preparation and submission procedures, even the first phase has to be regarded and handled as a separate project whose successful completion allows phase two (the “actual” research project) to be materialized. In the next paragraphs we give a small overview of phase one.
The required administration work for a project to have a good chance for being accepted for funding (i.e. successfully complete the proposal preparation, submission, and evaluation phase) can be quite daunting. After the submission of the required project description and other supporting information to an appropriate invitation for proposals (“Call for Proposals” - CfP), the EC respective bodies (“directorates”) verify that the proposal meets the eligibility criteria referred to in the respective CfP. These criteria are rigorously applied and any proposal found to be ineligible is excluded from evaluation. After that, all proposals that fulfil the eligibility criteria are evaluated to determine their quality against criteria such as scientific/technological quality and innovation, contribution to policies, contribution to social objectives, economic development and future prospects, partnership and management. Finally, the proposal is weighted on several criteria that are decisive factors for a successful acceptance, including whether:
- it is both necessary and beneficial to carry out the project at a European –and even broader– level instead of a national or private level,
- the proposal has medium- or long-term strategic importance for industry and society,
- the project supports multiple policies (e.g. environment, free circulation of goods, consumer protection, employment, transport, and energy),
- the project addresses/solves problems related to standards and regulations,
- the project has a positive impact on social and economic cohesion (for example by technology transfer to less technically advanced regions),
- the consortium displays high quality in its partner composition, is well-balanced, and includes all the required expertise in order to meet project objectives.
Assuming that the proposal is successfully evaluated and accepted, we can now discuss challenges associated with phase 2. EC FP projects possess all the characteristics of research projects i.e. more than any other kind of project, they are unique and oriented towards generating new knowledge. The research projects carried out within the EC FPs have some additional attributes though that make them even more complex, difficult to plan, and challenging, as described in the following sections:
The challenge of managing multiple organizations
The main challenge in EC FP projects stems from the fact that the Project Manager is effectively supervising people and organizations over which he/she has practically no “official” control and authority. This makes the PM more like a “coordinator” who aids the participants to achieve their goals (and thus the project objective) than a “manager” with the authority to dictate actions and plans. In other words, the consortium partners are not in any way “subordinates” to the PM but rather equal “partners in research”, in line with researchers' mentality that is characterized by a large degree of independence in they way they pursue their work. Given also that when it comes to the essence of the project work, the researchers and scientists of the project partners are usually more technically adept than the PM, it is not uncommon to have many project members demanding an equal share in the project decision processes.
As we are now going through the sixth instalment of the EC FPs, the challenge associated with being responsible (and eventually accountable) for several organizations spread in various countries is finally acknowledged, as for the first time in the FP series the Project Management activities have dedicated funding and are often encouraged to be assigned to institutions and people with professional experience in running research projects (CORDIS, 2002) – that is Project Managers specialized in research. Those people that will endeavour in managing research projects within the EC FPs have to possess the skills of coordinating objectives, relations, and people in a web of autonomous organizations with both converging and contrasting priorities and interests. PMs in EC FPs projects are also people who are able to distinguish the fine line between consistency of project output (that must conform to certain attributes such as “on time” and “on budget”) and the unpredictability of research results (including potential new opportunities arising in the course of the project). This opens up many interesting paths that the PM can explore such as whether the quality of the results could improve if deviations from plan were allowed, or even if an altogether different result than the one originally anticipated could turn out to be both superior and more useful as far as the project's targeted objectives are concerned.
The challenge of managing cultural differences
In EC FP projects, the PM faces the delicate situation of coordinating project members spread across different organizational entities and countries where unattended cultural and behavioural differences can have a detrimental effect on the consortium cooperation. As such, multicultural awareness and diversity have to be embedded in the PM's psychology and behaviour. The PM has to deal with people coming from such different backgrounds and only by understanding and respecting these backgrounds can the project operation be efficient, especially since not only different national languages and cultures are encountered but also different organizational patterns and professional cultures. To this respect, it is a must to hold regular project meetings (neither video-/teleconference nor email can substitute the catalytic effect of personal contact) in order to aid the project partners develop and sustain a tight bonding among them and realize their common goal.
The challenge of managing diverging business priorities
In order to minimize the high-risk inherent to research and contribute to each partner's organization objectives and strategy, it is recommended that research projects executed within the EC FPs are aligned to an already running internal project/strategy in every partner's organization. This holds true especially for industrial partners and their business units involved in product development, but all other partners, including academia and research institutes, should have a vision under which they pursue their research. By doing this, the EU-funded R&D effort complements and contributes to the overall vision of an organization and leads to better exploitation of results that are generated under a wider strategic plan. However, because of the research nature of EC FP projects, the targeted time for exploiting the project outcome can be as high as 5 to 10 years, whereas e.g. the product cycles of business units are usually much shorter, taking into account such critical parameters as time-to-market, window-of-opportunity, etc. Consequently, the scope and/or strategy of the research EC FP projects may need to change during the project course in order to suit the partner's and/or consortium's exploitation objectives. This is a fundamental difference from projects where “scope creep” is considered a pitfall to be avoided at all costs. It is thus the role of the project manager to track and anticipate these changes by constantly gathering intelligence from sources relevant to the project research objective.
The challenge of managing IPR in a research consortium
EC FP projects attract different types of partners, e.g. multinationals, SMEs, laboratories, universities, research centres and other groups with different interests and thus a different approach on IPR handling and background information. Most importantly, knowledge developed during the project is owned by the contractors who carried out the work generating the knowledge. However, where several contractors have carried out work generating knowledge,–as is often the case in these projects, they must agree among themselves on the allocation and the terms of exercising the ownership of the knowledge in accordance with a document that is drawn between them, the Consortium Agreement (CA). The CA is signed by the participants in a project, but not by the EC, and its signing process must be completed prior to the project commencement date. The CA aims to specify or supplement the provisions of an EC FP project's model contract, but it must not conflict with them, and although it is not obligatory in all projects, it is still always strongly recommended in order to create a strong project and to facilitate good relations between partners.
The challenge of managing different regulatory frameworks
The opportunity of minimizing risk by performing research in a co-development nature, becomes potentially a threat when the output of the project is about to leave the pre-competitive phase and go into production level. It is imperative that the differences in the regulatory frameworks across the countries that participate in the project have been identified and assessed well in advance. This is to ensure that when several partners co-develop a product that will later be commercially exploited in different countries/regions, specifications of the project outcome must conform to the regulatory frameworks of those respective countries. This is especially true between EU and non-EU countries where the regulatory differences can be rather significant. The PM has to be aware of these differences and make sure that the project partners take them into consideration in their project exploitation plans.
Research excellence in EC FP projects: lessons learned and the five groups of processes
Achieving excellence in research results is what EC FP is all about, and it is also the single most significant challenge that the project manager will face in the course of these projects. In the following, we shall discuss some of the authors' “lessons learned” while carrying our their project management responsibilities in relation to the well-known five process groups of initiation, planning, executing, controlling and closing (PMI, 2000, p30).
In the 2000 edition of the Guide to the Project Management Body of Knowledge (PMBOK® Guide) it is mentioned that the initiating processes “authorize the project or phase” (PMI, 2000, p30) and that initiation is the process “of formally authorizing a new project or that an existing project should continue into its next phase” (PMI, 2000, p53). A fundamental objective in initiation is to reach consensus among project participants on the core target(s) of the project (or of a project phase) that is(are) about to be undertaken. To achieve this in EC FP projects, it is imperative to establish a reliable framework of open and sincere communication among partners. Establishing such a “web of trust” amongst partners is not trivial as participants in EC FP projects have usually different agendas for participating in these projects, thus pressing for an exclusive interpretation of the project/phase target may have a negative impact on the motivation aspect. As motivation is a critical element in the project initiation phase and can be the single most important driver that can lead to excellence in research results, it may sometimes be for the benefit of the project that not all project partners are in agreement to an identical target of the project/phase; the PM can ask project partners to mix alternative “versions” of the project goals at the same time in order to accommodate for everyone's agendas. Naturally, against this unorthodox point of view, it is easy to argue that focusing on a consistent result is important in order to avoid wasting man-months and for shaping right from the start what the project/phase is all about. In the end, it is the call of the PM to explore the opportunity of approaching some of the project's goals with a certain degree of flexibility that –especially in the case of research projects– can potentially allow for certain project goals to be adjusted more easily to future changes in the project.
The planning processes facilitate “defining and refining objectives and selecting the best of the alternative courses of action to attain the objectives that the project was undertaken to address” (PMI, 2000, p30). It is common sense to argue that setting achievable targets and realistic objectives helps to ensure a successful project; on this basis, the EC FP guidelines put significant weight on setting project milestones and deliverables, as it is also an important criterion for evaluating the management “quality” of the project proposal. However, experience has shown that given the high degree of uncertainty, which is embedded in research activities, it is not wise to expect that what makes sense at the project's planning phase will necessarily yield meaningful or even achievable results by the project's end. Furthermore, setting very “down-to-earth” objectives in research projects, in order to be on the safe side, can potentially cause the researchers to miss the opportunity to produce truly innovative results, given that operating “according to plan” would yield adequate and contractually “acceptable” output. It is thus better to adopt a “rolling planning phase” approach where the project base-line is not 100% defined upfront but instead it is approached in 3-6 month intervals that allow revising the deliverables and milestones and closely adjusting the project to the constantly changing state-of-the-art research environment. By doing so, the project can yield truly excellent results and fully justify its research nature.
Executing processes are focused on “coordinating people and other resources to carry out the plan” (PMI, 2000, p30). The actions of “coordination” and “carrying out the plan” in EC FP projects have to be understood that they go far beyond simply controlling that deliverables produced and milestones achieved are on time and on budget, as discussed in the equivalent section for planning processes. Having in mind that the first priority in EC FP projects is the excellence of the research results (project scope as opposed to time or cost) in this phase the PM should grant the researchers the flexibility to modify their paths to achieve “better” results by being as flexible as needed. Trusting project researchers has also to do with the research nature of the project, which often creates a sort of a “technical expertise gap” between the project manager and the other project participants. This “gap” is caused as bits and pieces of the project are usually in the expertise domain of several project members while it is extremely rare to encounter a single person, including the PM, who will possess all of the project's required technical expertise in multiple science disciplines. Having a highly confident team, with an established web of trust and credibility among them, makes it easier to delegate responsibilities and allow for the necessary flexibility in project execution.
The controlling processes “ensure that project objectives are met by monitoring and measuring progress regularly to identify variances from plan so that corrective action can be taken when necessary” (PMI, 2000, p30). Given our previous discussions in planning and executing, it is a logical assumption that applying tight controlling processes in an EU FP project to “to identify variances from plan” can have negative impact if an opportunity to go further in the research results is missed. It is again up to the PM to decide the level of variance that is “research-oriented” and thus acceptable as it is positively contributing to the project's innovative purpose.
The closing processes make sure of “formalizing acceptance of the project or phase and bringing it to an orderly end” (PMI, 2000, p30), i.e. assessing the end-results of the project/phase. The traditional way to assess project success is to measure how well the end results are compared to the targets initially set. To this respect, it is important that “success metrics” are agreed in the beginning of the project and respected by the consortium till the closing phase. Given that EC FP projects aim not to be a “single”, “one-time” research and development event but instead lay the foundation for future partnership and cooperation, it is important to include in the success metrics the extent to which (a) the results have future strategic significance, and (b) the knowledge that was generated through the project can be disseminated and reused.
“Leadership is the art of accomplishing more than the science of management says is possible.” (Powell 1996, p255)
This paper has clearly hinted that managing EC FP research projects has a great deal to do with influencing organizations to overcome cultural and other differences, building consensus on the goals of the project within a team of highly-skilled and independent-minded people, and achieving excellence in the project scope while respecting time and budget restrictions. Such challenges can only be successfully faced by a project manager who scores high on the leadership scale: a person having the ability to inspire project members for getting things done in the right direction without micro-managing how or when they are done. Referring to Hersey and Blanchard's model of situational leadership (Hersey & Blanchard, 2000), a “highly mature” PM can accomplish much more in EC FP projects by being an advocate of “delegation” and “participation”.
On the other hand, the fact that participants of EC FP projects expect a large degree of research autonomy or that research efforts have a high level of uncertainty should imply neither that the management of these projects is to be done “ad hoc” nor that leadership skills alone would suffice for a successful project: EC FP research projects can indeed be unpredictable but they aren't and shouldn't be unmanageable. The PM should aim to organize the project in a way that accommodates the unique nature of each research effort, takes into consideration the cultural and other elements of every project participant, and benefits from leadership charisma for coordinating the project team towards facing the extraordinary challenges associated with ground-breaking research efforts – and at the end of the day, reaping the extraordinary rewards that come with excellence and innovation.
The authors of this paper have undertaken PM responsibilities in numerous EC FP projects, including: BRAVE (3rd FP), MANTIS (3rd FP), ICM (3rd FP), IDSM (3rd FP), TOMQAT (3rd FP), PLANET (4th FP), INFOGATE (4th FP), NOTE (4th FP), BC3 (4th FP), PRO3 (5th FP), ADAMAS (5th FP), WINMAN (5th FP), SEEREN (5th FP), and SEEGRID (6th FP). The authors wish to express their deepest gratitude and appreciation to all of their project colleagues for the truly challenging times that led to so many memorable moments.
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© 2004, Nikos Vogiatzis and Jorge-A. Sanchez-P.
Originally published as a part of 2004 PMI Global Congress Proceedings – Prague, Czech Republic