Relating sustainable development and project management

a conceptual model

WU Vienna University of Economics and Business, Austria

Abstract

Sustainable development has become a recognized integrative component of political and entrepreneurial decision making. Sustainable development is considered in societies and companies and has received increasing attention in management literature. Sustainable development in temporary organizations such as projects and programs is rarely considered. First attempts to relate sustainable development and projects can be found in literature and practice. However, the challenges and potentials of relating sustainable development and project management have not yet been researched in depth.

In this conceptual paper, we bring these two concepts together to see how project management can be further developed by explicitly integrating the principles of sustainable development. For relating sustainable development and project management, we developed a model, which is based on a process-related sustainability definition. We use the model to discuss selected relationships between these two concepts and offer first propositions on the challenges and potentials for project management, when considering sustainable development principles. We then point out the need for additional research and show which next steps we have planned in the research project for sustainable development and project management (SD&PM).

Keywords: project, temporary organization, project management, sustainable development, corporate social responsibility

Introduction

Originally, sustainable development can be considered as a political concept (Jacobs, 1995; Lafferty, 1995). It contains normative principles as inter- and intra-generational and gender equity as well as justice and participation. In the public the concept of sustainable development acquired wide attention following the publication of the so-called Brundtland Report by the World Commission for Environment and Development (WCED) in 1987. The report defined sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (WCED, 1987, p. 43), In addition, it said that sustainable development consisted of “two key concepts: the concept of needs, in particular the essential need of the world's poor, to which priority should be given; and the idea of limitations imposed by the state of technology and societal organization on the environment's ability to meet the present and future needs” (WCED 1987, p. 43). The Brundtland Report relies on not only technological innovation, but heads for more fundamental processes of institutional, social, economic, cultural, and lifestyle changes (Baker, 2005). A significant number of attempts to define the term sustainable development were made (e.g., LéLé, 1991; Beckermann, 1994; Redclift, 2005). In this research, we apply a process related definition, based on the guiding principles of sustainable development (Hopwood, Mellor & O'Brien, 2005; Fergus & Rowney, 2005).

Sustainable Development and Its Relevance for Different Social Systems

The application of sustainable development is relevant for different social systems, such as society, region, company, and project. As a political concept, sustainable development has found application internationally, nationally, and regionally. The consideration in cooperations is a more recent development.

Table 1 provides an overview on applications of sustainable development in different social systems.

Table 1. Overview on Applications of Sustainable Development in Different Social Systems

Social System Examples for Application
International

• Kioto protocol (CO2 emissions 2008-2012)

• Millennium development goals (reduce poverty)

• ILO standards (international labor standards)

• Global compact (UN initiative)

• OECD guidelines for multinational companies

• ISO standards (ISO 14000, ISO 26000)

National

• Awareness raising, education

• Sustainability reporting (FR)

• Sustainable public procurement (NL)

• Socially Responsible Investment (SE)

• Coperate social resposnibility strategies (DE)

• SD strategies

Regional

• CSR consulting programs

• SD technology parks

• Local Agenda 21

Organization

• Environmental management systems

• Industrial ecology

• Triple bottom line reporting

• Corporate social responsibility

In the last 20 years, sustainable development has found application in organizations. The 1990s were dominated by the diffusion of environmental management systems (i.e., ISO14001, EMAS), while recently the concepts of corporate social responsibility and corporate sustainability receive increasing attention. While sustainable development is a normative societal concept, corporate sustainability is a corporate concept and corporate social responsibility (CSR) can be seen as a strategic management approach aiming at increasing competitiveness and building the bridge between the societal demand and the success of an individual company (Steurer & Martinuzzi, 2005). A company is increasingly seen as a social actor with an array of responsibilities towards a broader group of societal actors than just the company's shareholders or its subcontractors or employees, i.e., communities as a whole, regulators, interest groups, and others. The tension between societal demands and shareholder demands is also reflected in the triple bottom line approach to performance measurement of enterprises (Henriques & Richardson, 2004), separately focusing on economic, environmental, and social performance, and social and economic accounting and reporting.

Increasing interest in the topic of sustainable development can be observed in organizational management and strategy research (Margolis & Walsh, 2003; Cummings & Daellenbach, 2009). Researchers have tried to link the consideration of sustainability to company performance (Orlitzky, Schmidt, & Rynes, 2003) and point out the necessity of integrating it into the core processes and functions of a company to receive performance benefits (Wagner, 2007). The sustainability balance scorecard has been discussed as one method of linking sustainability management to business strategy (Figge, Hahn, Schalteggar, & Wagner, 2002).

Research Problem and Research Approach

We consider projects as temporary organizations (Lundin & Söderholm, 1995; Turner & Müller, 2003) and as social systems (Gareis, 2005) and thus seek to relate the concept of sustainable development to projects management. First attempts to relate sustainable development and project management can be found in research and practice.

Ethics for project management and project managers is discussed (Godbold, 2007; Helgadottir, 2008) and is relevant in the discussion of the project management profession. Recently, case studies on sustainability projects, such as reduction of emissions, alternative energy, humanitarian aid, and development have been published to raise awareness for this topic in the project management practice community (for instance see issue of PM Network, Project Management Institute [PMI], 2008).

Project management approaches and instruments were put together in toolboxes and handbooks to manage sustainability projects. Project sustainability checks have been developed for specific project types such as facility and infrastructure projects (American Council of Engineering Companies [ACEC], 2009). Case studies of appraising sustainability in projects have been reported for example for construction projects (Edum-Fotwe & Price, 2009). The focus lies on the achievement of sustainability in the project results of specific project types, rather than the consideration of sustainable development in the project management process.

Some project models, for instance the International Project Management Association (IPMA) project excellence model which was developed by the German Project Management Association and is used as the basis for the IPMA Project Excellence Award (www.ipma.ch/awards/projecellence), consider sustainability and social responsibility in project management as well as in the project results. The project excellence model considers the importance of the identification and consideration of relevant project environments in the formulation of the project objectives and advocates the internalization of social interests in the project.

Although increasing interest in sustainable development is observable in the project management practice and research community, concepts how to integrate explicitly principles of sustainable development in project management and operational methods are missing. As shown in Figure 1, in this research paper, we relate the topics of sustainable development and project management as related to each other. Our focus is the research area where sustainable development and project management overlap. Sustainable development and project results are only considered as a relevant context, as we suspect that the consideration of sustainable development in project management supports the achievement of sustainable project results.

The challenges and potentials of sustainable development in project management have not yet been researched in depth. This paper tries to take a first step into this direction, by developing a model for relating principles of sustainable development to project management.

Research Area

Figure 1. Research Area

In this research paper, we concentrate on discussing the research questions:

  1. How can sustainable development be related to project management?
  2. Which challenges and potentials arise for project management when integrating principles of sustainable development?

To discuss this research question we developed some basic working hypotheses, which are:

  • While a content-related definition of sustainable development is appropriate for consideration in the project results, a process-related definition of sustainable development is appropriate for consideration in project management.
  • Sustainable development principles are of relevance in most objects of consideration of project management, such as project objectives, project scope, project schedule, project costs, resources, and project risks, project organization, project culture, project personnel, project infrastructure, and the project context.
  • To consider sustainable development is important in the overall project management process. We suspect no major differences of the relevance of sustainable development in the sub processes project starting, project coordinating, project controlling, and project closing. Sustainable development principles are of relevance in the designing of the project management process.

The research is based on the organizational paradigm of the social systems theory (Luhmann, 1995) and the epistemological paradigm of the radical constructivism (von Glasersfeld, 1995). The model and the working hypotheses are results of a cyclic research process. In this conception paper, we report the model development. The model and working hypotheses are based on literature review and on a communication process in the researcher team, consisting of project management as well as of sustainability development researchers. The model and the working hypotheses are explicitly framed as social constructions and will be further developed in the next step of the research, which is outlined at the end of this paper.

The working hypotheses introduced earlier in this paper are guiding us in our research and in this paper. They will be discussed in the next sections of this paper and lead us to the model. To draft a model, we derive the principles of sustainable development from the literature and identify adequate ones to relate them to project management. Then we describe project management and introduce the objects of consideration of project management. Finally, in the model we will bring these two concepts together and develop further working hypotheses.

Process Related Principles of Sustainable Development

We differentiate content-related definitions of sustainable development and process-related definitions. An example of a content-related definition of sustainable development is published in the renewed EU sustainable development-strategy. The current SDI framework (as of the beginning of 2008) comprises 122 indicators (accompanied by 14 contextual indicators) grouped into 10 themes:

  • Socioeconomic development,
  • Climate change and energy,
  • Sustainable transport,
  • Sustainable consumption and production,
  • Natural resources,
  • Public health,
  • Social inclusion,
  • Demographic change,
  • Global partnership, and
  • Good governance.

Content-related definitions of sustainable development have been linked to the contents of projects and their results, but are not all relevant when it comes to discuss a possible integration to project management. For expanding to the management perspective of projects and assessing potentials and challenges deriving from sustainable development for project management, we shift from a content-related view of sustainable development to a process related view. In doing so, we follow Leiserowitz, Kates, & Parris (2005) who highlighted the fact that “the creative tension between a few core principles and the openness to re-interpretation and adaptation to different social and ecological contexts” is what has given sustainable development its staying power. A process-related view is provided in the guiding principles of sustainable development (Hopwood et al., 2005; Fergus & Rowney, 2005). We, therefore, define sustainable development with the following guiding principles:

  • Holistic approach,
  • Long-term orientated,
  • Large spatial and institutional scale,
  • Risk reducing,
  • Values and ethical considerations, and
  • Participation and capacity building.

Holistic Approach

The holistic approach, requiring to proportionally integrate economic, ecological, and social considerations in decision making, was well established in the Agenda 21 from Rio de Janeiro 1992, the most comprehensive strategic document to implementing sustainable development to date (United Nations, 1997). Horizontal policy integration (Lafferty & Hovden, 2003; Steurer & Martinuzzi, 2005), integrated/sustainability impact assessments (Lee & Kirkpatrick, 2006), decision-support tools, such as the multi-criteria analysis (MCA), as well as involvement of various societal actors in decision making to foster legitimate choices about trade-offs between the three dimensions are all examples of procedural answers to the challenge of holistic approach and the associated challenge of complexity.

Long-Term Orientated

The sustainability of ecosystems over time (as introduced in the sustainable forestry principles) as well as the consideration of the needs of future generations (intergenerational equity, introduced in the Brundtland Report) is in direct contradiction with the today's ever-shortening time horizon of decision makers. Increasing complexity of decision situations is quickly making traditional planning, dealing with the future and uncertainty through prediction and preparation, obsolete. Long-term orientation requires improvements in our capacity to address complex, evolving systems which main attribute is uncertainty, and shifting to a paradigm of perceiving and adapting to change, with the key elements of social learning, innovation, and design (Bagheri & Hjorth, 2007).

Large Spatial and Institutional Scale

Ecological, economical, and social processes affecting our well-being take place simultaneously at various spatial and temporal scales (Holling, 2001). In order to efficiently address these nested and interlinked processes, sustainable development has to be a coordinated effort playing out across several levels, ranging from the global to the regional and the local (Martens, 2006), and institutional responses have to correspond to the problems at hand (Young, 2002). These principles are already reflected in the themes of “new governance” such as multilevel governance, network governance, and horizontal policy integration (Lafferty, 2004; Baker & Eckerberg, 2008).

Risk Reducing

The understanding that in environment-society system interactions, characterized by complexity, indeterminacy, irreversibility, and non-linearity, it is more efficient to prevent rather than ameliorate damage, has led to the formulation of the so-called precautionary principle.1 However, it is increasingly evident that decision making about complex systems in the conditions of uncertainty, ambiguity, or ignorance (rather than in the conditions of probabilistic risks) is a significant challenge for how we produce, distribute, and use knowledge (see e.g. Munda, 2003; Giampetro & Ramos, 2005).

Values and Ethical Considerations

Sustainable development has been understood as a normative concept from the very beginning (Davidson, 2000; Robinson, 2004; Martens, 2006) and thus reflecting values and ethical considerations of the society. The underlying assumptions in decisions about trade-offs between the present and future generations (intergenerational equity) and about distribution of welfare in the present generation (intragenerational equity) should always be made explicit and legitimized (e.g. through involving relevant stakeholders).

Participation and Capacity Building

Involving social actors in projects that can potentially affect their lives builds on one of the key principles of sustainable development: sustainable development requires a process of dialogue and ultimately consensus-building of all stakeholders as partners who together define the problems, design possible solutions, collaborate to implement them, and monitor and evaluate the outcome (Hemmati, 2002). Participation encourages social and individual learning that enriches both society and individual citizens, reduces the uncertainty caused by imperfect scientific knowledge and the indeterminacy of complex processes, supports implementation, and defuses conflict (Blackstock, Kelly & Horsey, 2007).

In respect to the previously mentioned, implementing sustainable development requires significant capacity and a reflexive and process-wise approach (Bagheri & Hjorth, 2007). We need to build social systems and processes capable of learning, which are supportive of institutional innovation, reflexive and adaptive.

Project Management

Different approaches to project management exist (Hodgson & Cicmil 2006). Some project management approaches are method-oriented (PMI, 2008), others are competency-oriented (IPMA, 2006), or process-oriented (Office of Government Commerce [OGC], 2002; Turner, 2009).

In this paper, we consider project management explicitly as a management process distinct from the content processes of the project. We, therefore, not apply a project life cycle model, but consider project management as a business process, which includes project starting, continuous project coordinating, project controlling, and project closing-down (Gareis, 2005).

The objectives of the project management process are to (Gareis, 2005):

  • Successfully perform the project according to the project objectives,
  • contribute to the optimization of the business case of the investment, initialized by the project,
  • manage the project complexity and project dynamics,
  • continuously adjust the project boundaries, and
  • manage the project-context relationships.

Following our basic working hypotheses that sustainable development is relevant for most objects of consideration of project management and in designing of the project management process, we describe what we mean by objects of consideration in project management.

Traditional project management focuses only on the management of schedule, costs, and scope. However, as mentioned before, we consider projects as temporary organizations and as social systems. Based on an identity model to describe social systems (Gareis & Stummer, 2008), we derive additional objects of consideration, which are of relevance for project management. A comprehensive list of objects of consideration in project management includes the following:

  • project objectives,
  • project scope, project schedule,
  • project resources, project income, project costs, project risks,
  • project organization, project culture, project personnel, project infrastructure, and
  • project context.

Project Objectives

From the characteristics of projects as goal-determined organizations, project success can be evaluated in correlation to the positive achievement of the project objectives. One can distinguish between content, schedule, and budget-related project objectives (Gareis, 2005, p. 204).

Project Scope and Schedule

The project scope describes all products, features and requirements the results of a project should generate. Furthermore, performance criteria as well as quality standards are included in the project scope (Gareis, 2005, p. 209).

The basis for project scheduling is the work breakdown structure. Based on this plan, further scheduling is possible regarding work package durations, start and end dates, as well as resources needed to complete the tasks. The detail of the planning may vary from rough to detailed and has to be adapted to the respective needs. Methods like bar charts, CPM (critical path method), milestone planning, and others complement each other and should guarantee a proper project scheduling (Gareis, 2005, p. 213–214).

Project Resources, Income, Costs, and Risks

Resources in project management terminology are required to carry out the project tasks. They can be people, equipment, facilities, funding, or anything else required for the completion of a project activity. By comparing project requirements with project resources, bottlenecks can be made visible. Hence, these scarce resources can be planned appropriately and a shortage can be avoided (Gareis, 2005, p. 229).

Project costs contain all costs arising during the course of a project. They can be calculated for individual work packages, for individual objects of consideration, for internal assignments, and for the whole project. Project costs do not include the costs of the post-project phase that need to be considered in a business case analysis (Gareis, 2005, p. 223). Project income includes for example payments from customers, sponsoring, or subvention payments (Gareis, 2005, p. 227).

A project risk can be described as “possibility of a negative or positive deviation from a project objective” (Gareis, 2005, p. 263). Therefore, risks can affect the success of a project and have to be managed properly.

Project Organization, Culture, Personnel, and Project Infrastructure

Designing the adequate project organization for a particular project may be considered as a central project success factor. Projects require adequate organizational designs including roles such as project owner, project manager, project team members, project teams, and sub teams. Further, the project organization must be related to the project executing company or companies. Central project management methods are the project organization chart and project role descriptions (Gareis, 2005, p. 69).

A project has specific values, norms and rules, i.e., project specific culture. The objective of the development of a project-specific culture is to develop a project identity that promotes the identification of the members of the project organization (Gareis, 2005:127).

The project needs to be staffed with project personnel such as the project manager, project team members, and project contributors. Specific human resource management activities are required on projects such as assigning, developing, appraising, and dispersing project personnel (Huemann, Keegan, & Turner, 2007).

Project infrastructure comprises appropriate information and communications technology infrastructure as well as spatial infrastructure, such as workspace and project office. (Gareis, 2005, p. 193).

Project Context Relations

A project is considered as social systems, thus it is constituted by differentiating it from its context. However, as it is related and embedded in its context, project management needs to design and manage these relations to the relevant context. The project context dimensions include, pre- and post-project phase, the relationships to the relevant environments, to other projects, and to the company strategies. Project management methods for designing the context relationships are for example project environment analysis and business case analysis (Gareis 2005, p. 234).

Project Management Process

Project management as process needs to be explicitly designed. In the project start, the project management process is designed in accordance with the specific requirements of the project. Elements for designing the project management process include the application of appropriate project management methods, selection of standard project plans and project management checklists, the selection and the design of appropriate project communication structures (Gareis, 2005, p. 185).

Relating Sustainable Development to Project Management

The model provided in Figure 2 provides a possible answer to the research question: How can sustainable development be related to project management?

Sustainable development is represented by the process-oriented principles: holistic approach, long-term orientation, large spatial and institutional scale, risk and uncertainty reduction, values and ethical consideration, and participation. Project management is represented by the objects of consideration of project management. To stress the relevance of project management as business process, we have added the criterion project management process. All the criteria have been described in the previous sections of this paper.

Draft Model: Sustainable Development and Project Management

Figure 2. Draft Model: Sustainable Development and Project Management

First potentials and challenges for project management can be discussed when relating the principles of sustainable development to project management. Not all relations have potential for further discussion. We have marked the boxes in grey where we see potential. These propositions are new working hypotheses, we derive at this stage of our research:

Project Objectives

In the definition of project objectives, economic, ecological, and social interests can be considered which might lead to an internalization of external interests.

Project Context

On first thought, the temporary character of a project contradicts the long-term orientation of sustainable development. Projects are temporary organizations to initialize investments in new products, markets, organizations, or infrastructure. Projects initialize investments in new products, markets, organizations, or infrastructures. By this, projects contribute to realize long-term objectives. The long-term orientation of sustainable development is considered by explicitly planning the post-project phases and by developing and controlling business case analyses.

Relationships to relevant project environments are a context dimension to be managed in projects. By a participatory and holistic project management approach, the quality of the relationships with the relevant project environments can be improved.

Project Organization

New approaches for the organizational design of projects consider sustainability concepts, such as integration (e.g., of representatives of suppliers and customers), partnering, and empowerment.

Sustainable development increases the complexity and dynamics of projects. On the other hand, it speeds up the decision processes in projects, because of a more cooperative project culture.

Project Infrastructure

In designing the appropriate project infrastructure, travel times can be limited by working in virtual project organizations and applying for instance video conferencing.

Project Management Process

Sustainability is of relevance in designing the project management process for a project. It is of concern in all project management sub-processes.

In some project management approaches sustainability is implicitly considered in the planning and controlling of the project objectives, project scope, project schedule, project costs, project resources, and project risks, project organization, project culture, project personnel, project infrastructure, and the project context. In the definition of project objectives, economic, ecological, and social interests are to be considered, which leads to an internalization of external interests.

Some Principles of Sustainable Development Are Implicitly Considered in Project Management

Depending on the project management approach, some principles of sustainability development are implicitly considered in project management. The possibilities to consider sustainable development in project management depend on the situation. The project type (e.g., construction project, reorganization project) and the structures and cultures of the companies performing a project influence the project management approach applied.

Conclusions and Further Research

In this paper, we showed the development of a model to relate sustainable development and project management. At this first stage of our research, we may conclude that there is potential and challenges for learning in project management, when relating principles of sustainable development. In discussing the model, we have derived further a working hypotheses, which will be further developed in the next stages of our research project SD&PM. In our further research, we

  • Analyze if and which principles of sustainable development are implicitly considered in project management of particular projects.
  • Conceptualize how sustainable development can be explicitly considered in project management.
  • Further analyze which challenges and potentials arise from the consideration of sustainable development in project management.
  • Draft instruments for explicitly considering sustainable development in project management.

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1 See the Rio Declaration: “In order to protect the environment, the precautionary approach shall be widely applied by States according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.” (Principle 15)

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