incorporating CFCS into project management
William J. Lekse
Dennis P. Slevin
Katz Graduate School of Business
University of Pittsburgh
Proceedings of the PMI Research Conference
11-14 July 2004 - London, UK
Advances in technology over the last two decades that support project management have created breakthroughs in new products and services in the areas of computing and communication. During this era project managers have adopted new devices—hardware, software, and network services—by following the advancements in these devices and/or services. Project managers evaluate the devices and systems individually by utilizing information and forecasting the potential of the devices to improve project procedures. Today and in the future this method of technology adoption will provide insufficient speed and scope to competitively adopt the new systems that are now being made possible by technological advances. The rate of technological advances is on explosive scales in both existing technologies and new technologies. Boundary growth of the potential impact such changes have on products and services affecting the way we work are no longer even limited to the unbelievable prediction limits of Moore's law for processing power (doubling every 18 months). We are experiencing even faster rates of advances in network bandwidths, wireless, storage, and graphics capabilities. The method in which project managers and organizations communicate, compute, and collaborate will continue to be impacted at a rate no one has ever experienced before. Being bombarded with information of advances in technology will be normal environment that project managers and organizations must survive in. We propose a new way to incorporate technology into the management of projects: One that incorporates new devices, systems, and services with a more holistic vision and originating from the user's perspective not from the perspective of improvements particular to a single device or service.
The Internet is the backbone of various networks in which this technological growth affects organizations. These networks are usually classified into three basic networks:
- Intranets for communicating within a company;
- Extranets for communicating along an organization's supply chain;
- The Internet for communicating on the World Wide Web and conducting e-Commerce.
These three networks makeup Computer Facilitated Communication Systems (CFCS), which managers and organizations use to communicate, collaborate, and search for information. We have developed our framework of platforms for project managers, which affords managers an alternative from incorporating new technology components merely as elaborate tools. These platforms assist project managers in their establishment of infrastructures integrating new technologies for project managers to envision a greater scope of impact that new technology has, not only on the management of a project, but also on the management of a portfolio of projects and the management of both internal and external stakeholders. These platforms assist project managers in understanding the benefits of technological advancements to manage projects and organizations. Managers using CFCS find technological advancements in devices, services, and their benefits. The combination of the platforms and the CFCS bring project management to where organizations and project managers should direct their resources to obtain optimum performance.
Our platforms have three managerial focuses:
- The first platform is viewed from the project performance perspective;
- The second platform is viewed from the organizations and/or the portfolio of projects perspective into the environment;
- The third platform is viewed from the stakeholder perspective.
The infrastructures adopted by managers should be integral to their organization and its own unique structure including its portfolio of projects and stakeholders. As the managers search for information from the perspectives of their platforms they evaluate the information's value by overlaying the results upon their organizational map's present and desired technological improvements in their knowledge structures. Of particular importance are the organization's knowledge structures that support their competitive advantages. Organizational map's of existing and desired knowledge structures should be included in each of our platforms. Focusing on closing the gaps between the respective knowledge structures within the platform's perspectives is primary for all knowledge structures managers. Organizational investigation should be conducted where improvements in managerial communications, collaborations, and the seeking of new knowledge related to these structures should be instituted. As the managers satisfy each platform's perspective the resulting benefits improve each platform's performance results. In this procedure technologies information flows and absorption will satisfy different but yet important perspectives. Managerial resources, tangible and intangible, can then be assigned to eliminate or reduce information gaps that exist between the platforms' optimum information systems and those of the present organizational maps.
CFCS connects managers to human and reference contacts inside and outside organizational and traditional geographical boundaries. Managers utilize CFCS to exchange information with these contacts developing a learning orientation that extends beyond organizational boundaries to find information that is valuable for their problem-solving, decision-making performance, and overall job performance. The use of CFCS can expand the present focus on project costs both tangible and intangible by directing our consideration of the information and knowledge processes in and surrounding the project from participating organizations, their stakeholders, and the environment. The costs during the actual duration of the project are important, but the sophistication of project management software and newly developed techniques has shifted the importance from just the performance of the actual project to the learning from project to project, from organization to organization, and from the environments stakeholders including governmental regulators. Items to be learned are not the obvious facts that easily relate to the physical projects, but include the stimuli of ideas and impressions of knowledge present in people, products, services, processes, and organizations that affect or potentially affect the projects both directly and indirectly. Projects are being conducted in many instances in virtual processes staffed by teams established in globally dispersed areas and by temporary personnel. The universal availability of the processes require project managers to develop competencies in using CFCS to manage the project details, to control costs, and to allocate resources ensuring project completion in a competitively optimum schedule.
We have investigated managers who utilize CFCS to search for information. We have found managers that have patterns of information searching using CFCS that has resulted in statistically significant higher levels of problem-solving performance, decision-making performance, and overall job performance. Analysis of the research-based data employing Partial Least Squares (PLS) methodology found the impact of CFCS to be highly statistically significant. The moderating influences of strategic posture and the organizational factor of decision-making responsibility are also considered and found to be both significant and revealing.
To date much has been presented to facilitate the details particular to project management, but what we want to present is how project managers can look at using CFCS to support three basic platforms—Rigidity I, Flexibility, and Rigidity II shown in Exhibit 1. These three platforms are developed from our research into how managers seek new information, where the information is found, and the benefit managers achieve (see Appendix 1).
Exhibit 1. Project Management's CFCS platforms and their focus
Rigidity I—Building on Existing Knowledge Structures
A multitude of technologies are involved in all projects from bridges to software development, and within each of these technologies there exist different life cycles caused by different rates of technical change. Because so many technologies exist there also exist numerous increases in the total technical complexity faced by project managers due to the interactions among these technologies and the project's processes. Technological change exists also in the turnover that fosters new products and organizations while others drop into oblivion at a rate measured in days not years. Each of the births, changes, alterations, and disappearances presents uncertainties to the project manager, because potential opportunities or threats may exist in every occurrence. From the designs to the materials or from the applications to the languages the discipline of project management encompasses unlimited technological changes, which if known and utilized can assist an organization in being awarded a project and then assist in making that project successful in both financial and reputation gains.
Within the theory-driven approach to information adoption managers use past experiences in similar circumstances to guide present information processing by establishing “knowledge structures” (Walsh, 1995). Knowledge structures are simplified information representations that facilitate processing of factors inside the worlds in which managers and their organizations function (see Exhibit 2). To enable the comprehension of complex information from environments in which managers should and must find meaning and develop direction, managers cognitively generate knowledge structures. Knowledge structures form a basis that facilitates the evaluation of ambiguous circumstances (Gioia, 1986) and improve the efficiency and effectiveness of information processing (Thorngate, 1980). Therefore, the benefits of using knowledge structures to develop our theory of CFCS information processing should be valid and worthwhile. A potential problem arises from using knowledge structures, namely, that the researchers and practitioners may develop limited vision. Limited vision can exhibit itself in reduced creativity, stereotypical thinking, subversive controlled information processes, and inaccurate information (Gioia, 1986). Therefore, for both the researcher and the practitioner, a means must be available to escape from the box potentially created by imposed boundaries around the knowledge structures. The function within CFCS of supporting the next platform, Flexibility, appears to be a particularly useful infrastructure to allow managers the means to escape from the box in obtaining information without risk of any asset commitment.
The knowledge structures of interest in this research are those of managerial information. Technology in this paper refers to both theoretical and practical information and knowledge that is present or can be used by managers within the sequence of activities that constitute a firm's value chain including what potentials exist in the firm's environment (Harris, Shaw, & Somers, 1981). Technology is present in every product and service, process and organizational function of the organization, its competitors, complementors, governmental agencies, and both direct and indirect stakeholders. Mainstream economics has accepted the importance of technological innovation as the root of modern economic growth (Teece, 2000). For centuries, assimilation of production technologies has had significant effects on production workers. Today, information technologies are now increasing the productivity of staff and middle managers (Drucker, 1988; Pinsonneault & Kreamer, 1993). The author will direct the research into the information present in both production and information technologies that is usable and needed by project managers and their organizations.
Managerial technological knowledge (MTK) represents the set of technological information that is uncovered, analyzed, evaluated, and then used by managers in their organizations to increase firm competitiveness (Teece, 2000). On one hand, project management looks toward creating dynamic capabilities within organizations and projects by altering existing technologies thereby creating new capabilities. At the same time project management is also aware of the potential that exists by continually developing closer alignment to existing technologies within the organization to improve existing capabilities. We see MTK at the core of this perplexing predicament within organizations. Relevant information is about issues with the potential to be opportunities or problems for the project's processes. Managers face uncertainties at every stage of the MTK process, because their senses are obscured by complexity, ambiguity, and munificence (Mason & Mitroff, 1981; Mintzberg, Raisinghani, & Theoret, 1976; Schwenk, 1984; Starbuck & Milliken, 1988; Hansen & Haas, 2001). CFCS offer the project managers many advantages for the gathering, processing, diffusion, and adoption of information from both inside and outside the organization.
To achieve success in an ever-changing technology landscape, coordination of management actions requires the establishment of networks to interconnect managers and experts. Networks' ability to adapt new technology to existing systems is significantly more successful than stand-alone technology adoption, but the adaptation of a system requires the system and its responsible parties to be open to the transfer of knowledge (Gopalakrishnam & Bierlt 2001). The establishment of a knowledge base and of knowledge structures is not a short-term project, nor done in isolation without regard to customers, but is more of a long-term program done with an understanding of the project's position in relation to its customer. These systems must be able to engage in complex information scanning, and be able to support and comprehend information and knowledge exchange processes and the methodologies of its managers (Downs & Mohr, 1976). The inherent complexity of technology adoption is a problem for researchers as well—usually they design their research to focus on one of the many dimensions of technology adoption and of the innovation (e.g., type, radicalness, stage) (Damanpour & Gopalakrishnan, 1998). Researchers investigating these systems and structures must address in their research the complexity of technology adoption and their methodology must have the capability to measure these complexities adequately.
The model investigated the content of the information (based on our proposed information typology), which managers find by utilizing the different components of CFCS. Managers should seek different information by specifically utilizing different CFCS components respective of their purpose. If this is the case:
- Impressions should be significantly related to searching while negatively related to e-mails both intranet and extranet;
- On the other extreme, facts should be significantly related to e-mails while not significantly related but still positive to searching;
- Ideas should have a mixture of each searching, extranet, and intranet.
Our research utilizes the second-generation multivariate technique of PLS to construct predictive models by estimating and assessing our structural models (Chin, 1998; Hulland, 1999). PLS has been chosen because of its primary objective of minimizing the error to achieve the highest R2 values of our dependent variables of managerial performance. Our model will investigate how corporate entrepreneurs and non-entrepreneurs' information gathering utilizing CFCS contributes to improvements in managerial performance.
The first survey instrument was a questionnaire whose first objective was to elicit from managers their technology-based information retrieval using CFCS in order to improve their knowledge structure of technology. The survey initiated a conversation with the managers, assisting them in their understanding and answering of the questions (Sudman, Bradburn, & Schwarz, 1996). The survey's prime objective was to investigate whether the managers were able to use the information obtained from the CFCS distinctive components to create knowledge that was used to improve their job performance and their decision-making capability. The first step in this process was to create indicators for each construct that reflect the developed theory. The target population was managers from different functional areas within numerous organizations of varying characteristics.
Empirical literature on either MTK or CFCS does not examine the concepts or constructs, as this research needs to accomplish. Moreover, studies on technological adoption investigate assimilation of tools (e.g., software) not knowledge. Hence, conceptual definitions from the literature were employed to develop the questionnaire along with general ideas from the referenced questionnaires.
The questionnaire was developed according to a process intended to generate an open atmosphere of comments so that the many factors in questionnaire development may be accurately balanced (Dillman, 2000). The design of the questionnaire was completed in cooperation with experts from academia with both research and field experience and with individuals having similar cultural backgrounds as the subjects. The review procedure included the experts taking devil's advocate roles in a process of improving reliability. The questions were developed to be reflective (effect) indicators of the functions of the latent variable. Therefore, changes in the latent variable are manifested (or reflected) in changes of the observable indicators. The questions were developed from a pool of items from a literature review and conversations with managers. The pool was evaluated by factor analysis in order to develop the indicators to represent the factors of the constructs. The questions were arranged in order to motivate the manager to respond in a confidential manner and thus to prevent any bias from thoughts of embarrassment and/or being a personal threat. The questions were arranged to facilitate recall and to motivate the subject to respond accurately. They are also primarily closed in design and developed to control for the method effects (McLaughlin, 1999). This was intended to put the subjects at ease, thus shortening the completion time, while simultaneously enabling them to reveal their true perceptions. Lastly, it made the data easier to analyze. The questions were varied by type and subject in order to make the exercise interesting for participates (Warwick & Lininger, 1975), which made the participates more willing to reveal their true remembrances. Questions were both dichotomous (yes and no) and Likert scaled with a 1 to 5 response scale from 1 being disagree strongly to 5 being agree strongly. The dichotomous questions were incorporated to expand the scope of the test while maintaining a convenient time period for completion. The Likert-scaled questions were utilized to evaluate the one-dimensional scaling between concepts. In particular the Likert-scaled questions were used to measure respondents' evaluation within the information typology to measure the respondents understanding of the concepts of an Impression, Idea, or Fact. The process of e-mailing the questionnaires included suggestions developed with the assistance of the principles of e-mail surveys by Dillman (2000).
In this study we were unable to use multiple informants for a single firm increasing the possibility of a method bias, where significant statistical relationships between variables are due to the method used to measure the variables rather than any true relationships between the constructs they represent (Venkatraman & Ramanujarn, 1987). To address this concern, data on just the dependent variables can be obtained from the respondents at a later time (Fichman & Kemerer, 1997). In that regard we administered a second questionnaire of 10 items, representing the dependent variable measures to a subset of the respondents for whom we had e-mail contact information. A period of at least eight weeks passed before the second questionnaire was sent out. Of the total available respondents with e-mails (49), 39 returned the second questionnaire, for a response rate of 80%. Analysis of these responses showed no significant differences in the Cronbach's alphas (1951) calculated for each dependent construct across the two time periods. Thus, method bias does not appear to be a major concern in this case.
The information typology and CFCS components model in Exhibit 2 positively assists in the representation of the typology's explanatory power. In Exhibit 2 the information typology of managerial information gathering has significant and understandable statistical significance. Impressions are found to be significant in searching while not significant in the communications with known sources (e.g., when managers use e-mails for contacts within their supply chain. Facts on the other hand are found within all three components of CFCS, but are found more within e-mails and to a statistically significant extent greater than in the searching function. Ideas are a mixed bag, being found within the extranet and searching function.
Exhibit 2. MTF and CFCS
Assessment of the Model
The internal consistency of all constructs is over .8 with the rule of thumb being .7 (Exhibit 1) and their discriminant validity is verified by none of the nondiagonal values being greater than the diagonal measures in Exhibit 3. The predictive power of the model in Exhibit 4—Technology-based Information Typology—CFCS components—is the R2 values for the dependent constructs of intranet .13, extranet .18, and searching .63.
Measurement Model—Internal Consistency
Exhibit 3. Technology-based Information Typology–CFCS Components–Internal Consistency
Exhibit 4. Technology-based information typology—managerial performance—discriminant validity
Exhibit 5. Technology-based information typology-CFCS Components Signs Corresponding Paths
Significant path coefficients exist from impressions to searching and from ideas to searching and extranet. Facts have significant path coefficients to extranet and intranet. Managers search for impressions from more distant sources, thus bridging structural holes when using the searching function of CFCS. Ideas are the objective of searches of distant sources and of contacts from existing sources outside of their corporation when using the searching and extranet function of CFCS accomplishing the bridging of structural holes and the utilizing of connections within existing weak ties. Managers while using CFCS primarily obtain facts when using the e-mail function. The diversity of managerial use of the components of CFCS to search specifically for either impressions, ideas, or facts assist in the verification that these constructs are recognizable to managers as separate and distinct constructs.
The study strongly indicates there is a high degree of variability when managers use the components of CFCS to find a diversity of technologically based information. The distinguishing factor of the types of information gathered by managers is recognized by managers to be obtainable selectively in the different components of CFCS. The focus of Platform One to concentrate this information by integrating its diversity to improve the content of their MTK by utilizing all three components of CFCS and selectively implementing the found information into the management of the project as shown in Appendix 1.
Flexability—Learning what you do not know—Improving the context
The strategic imperative of an organization's information processing systems is to maintain, improve, or make obsolete their competitive advantages by the adopting of new knowledge before their competitors (Hamel & Prahalad, 1993). One important consequence of this imperative is that the investigation of managers' abilities to improve their knowledge base has great value not only for the managers themselves, but also for their organizations (Grant, 1996; Sanchez & Heene, 1997). Managerial knowledge creation processes are part of the strategic logic of the firm (Sanchez, Heene, & Thomas, 1996). In fact, the ability to track and respond to change may be one of the most important functions within an organization, because “the firm's ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments” constitutes an organization's dynamic capability by which the firm is able to integrate, build, and renew knowledge throughout its entire structure (Grant, 1996; Teece, Pisano, & Shuen, 1997; Eisenhardt & Martin, 2000). Effectively structured project management offices can actually initiate and accelerate the ability of organizations to absorb new knowledge. Project management offices are not only at the outer bounds of the organization but they are also receptors of diverse contacts with project managers and their stakeholders. The lessons that project managers learn are potentially the most creative within an organization. The capabilities that CFCS possess can make efficient and effective knowledge management procedures within these projects to sow the seeds throughout the organization to foster revenue-generating products, services, and procedures.
Although the dynamic strategic imperative of an organization is one that supports and facilitates change, there exists another strategic imperative within all organizations that is in direct opposition to it and that is the imperative of “fit.” The imperative of the theory of “fit” is to maximize performance by having correspondence between an organization's tasks, systems, and technology (Goodhue, 1988). Organizations exhibiting a high degree of “fit” have been linked to the adoption of technology that is related to technology present within the organization (Cooper & Zmud, 1990) and its use within the organization (Floyd & Lane, 2000).
On one hand, management looks toward creating dynamic capabilities within their organization by altering existing technologies thereby creating new capabilities. At the same time management is also aware of the potential that exists by continually developing closer alignment to existing technologies within the organization to improve existing capabilities. We see MTK at the core of this perplexing predicament within organizations. Relevant information is about issues with the potential to be opportunities or problems for the managers' organization. Managers face uncertainties at every stage of the information process, because their senses are obscured by complexity, ambiguity, and munificence (Hansen & Haas, 2001; Mason & Mitroff, 1981; Mintzberg, Raisinghani, & Theoret, 1976; Schwenk, 1984; Starbuck & Milliken, 1988). CFCS offers project managers many advantages for the gathering, processing, diffusion, and adoption of information from both inside and outside the organization.
Managers have utilized their knowledge of organizational processes to develop methodologies that transform their tacit knowledge into systems of explicit knowledge allowing lower levels of the organization the capability to improve the organization's effectiveness organizational functioning (Nonaka, 1991). In a similar vein, managers also make decisions on changes in products and services from inception to cancellation, and on implementing changes in the organization's structure. Thus, the emergence of the “Control Revolution” (Beniger, 1986) was accompanied by the “Manager's Knowledge Revolution,” which contributed to the improvements of the organization's products and services, and the processes of the organization's primary and support functions. The maintenance of the process to create and sustain competitive advantages, which integrates technology and people, is the primary responsibility of management in the information age. Managers can no longer be viewed as merely coordinators of experts, whereby the experts' outputs control the accomplishment of the organization's goals. Managers must now become knowledgeable about the technologies that do and can impact the organization's competitive advantages, along with the acceptance process that adapts technology to the organization's daily processes for its long-term growth.
Today, the organization's process of managerial knowledge accumulation is supported by CFCS for both intra- and interorganizational information transfers. Since the advent of the Internet, managers have been able to find and adopt new technologies when using CFCS. CFCS offers the manager many advantages for the gathering, processing, and distribution of information from both inside and outside the organization. In general, information technology enlarges the roles of managers within organizations facilitating interrelationships between structures. These new organizations develop cultures specific to their business strategy requiring them to use more knowledge, judgment, and experience affecting the organization's operational efficiency and effectiveness (Pinsonneault & Kraemer, 1993). CFCS brings to managers real-time monitoring of the total organization's operation and a broadband of developments from interactive global sourcing (Ives & Jarvenpaa, 1991). The assimilation of information obtained from real-time monitoring gives organizations the opportunity for potentially continuous first-mover advantages. Whereas information from diverse sources polished by real-time interactive discourse gives organizations the maximum potential to succeed in new markets and minimizes the risk of losing the benefits from the exchange of different insights. The competitive need to innovate, while decreasing time-to-market, requires organizations to schedule multiple product-development projects aggressively and then execute them concurrently. Rapidly changing market conditions and the resulting fluctuations in the availability of scarce human resources across projects challenges the organization's ability to rely on past assumptions and existing project scheduling approaches and tools. Therefore, managers utilizing innovation-generating aspects of CFCS can greatly improve present and future competitive operations. Organizations that take advantage of this shift in information-derived power by the transfer of knowledge from centralized corporate offices to the managers of decentralized divisions will leverage the benefits of CFCS by further reducing costs, improving accuracy of managerial decisions, and reducing response time for market and operational improvements. Many of the present organizational changes (e.g., flattening and matrix with cross-functional responsibility) are entered into because of the above efficiencies that IT systems combined with CFCS create within the informational flow of organizational systems. These efficiencies facilitate the flow of information throughout the organization in general while simultaneously assuring that individuals are connected to the specific pieces of information necessary for them to perform their functions with accuracy and in a timely manner.
In particular, the Internet, extranets, and intranets within the CFCS connect managers in real time to multimedia information available within their organization, and also with multiple contacts around the globe. Researchers observing the disruptive changes in organizations facilitated by the organizations' utilization of the potential of CFCS have called for investigations into this revolution in managerial knowledge development (Orlikowski & Barley, 2001). These disruptive technological changes affect not only information transfers to generate managerial knowledge, but also the power and control capability of the organization to gather, filter, and deliver information to its managers for their consideration when making decisions. Intraorganization teams that are globally distributed are supported by CFCS through web-enabled applications with interfaces to corporate systems (e.g., ERP). The global distribution of projects complicates the management of the portfolio of projects while assuring effective implementation of the organization's business strategies. Management must face fast decisions on getting the appropriate resources to the correct project aligning with the organization's business strategies when needed realizing optimum profit contribution. CFCS expands the management potential to prioritize the projects on more than financial criteria by extending the analysis to consider human knowledge of unique skills. Organization's product and service development capabilities are dependent on multiplying the organization's scarce resources. The effective matching of projects with tangible and intangible resources to maximize the development of organizational capabilities can be more effective by managing the CFCS that managers are motivated to utilize. Implementing CFCS to interact with intraorganizational contacts can assist in reducing the gap that may develop in under connected management teams. As managers interact with intraorganizational contacts the knowledge that others have developed by doing can be transmitted throughout the organization.
Interorganizational communication and scanning has been of importance and on the agenda of researchers and practitioners within each of the last four decades (Mason & Mitroff, 1981; Mintzberg, 1973; Thompson, 1967; Vandenbosch & Huff, 1997). In order for managers to accomplish their multidimensional tasks (including decision-making and motivating employees to change), they need information from a variety of sources outside their own organization. The information will tell them where they should direct their interest and their efforts in order to find more information for the formulation of finished views about conditions both inside and outside their organizations. An external network evaluation would include in its investigation measurements of interactions with outside organizations and external experts. When managers have formulated a position, taking into account their organization's relative position in the environment, they are then able to develop alternative actions and strategize with relevant stakeholders. The entire managerial process is initiated, supported, verified, developed, and implemented by the manager's use of information. Therefore, managers need to utilize fully the systems that are available to them; and organizations need to understand the effects that their systems and cultures have on their managers' usage of the systems.
The capability of an organization to integrate knowledge is a key competitive asset (Conner & Prahalad, 1996; Grant & Baden-Fuller, 1995). Much of this knowledge comes in the form of transferring information through inter-firm collaboration (e.g., joint ventures and strategic alliances) (Mowery, Oxley, & Siverman, 1998). Since 1983, a dramatic increase in the annual formation of international joint ventures and strategic alliances has occurred to market and develop goods and services globally. Strategic alliances offer international corporations (and corporations desiring to be global) a fast and flexible vehicle to achieve market access, economies of scale, and to develop competences (Astley & Brahm, 1989; Lorange & Roos, 1992; Ring & Van de Ven, 1994) while reducing risks, reducing costs, and achieving initial results quicker than initiating “Greenfield” ventures (Balakrishnan & Kosa, 1995; Ohmae, 1989; Porter & Fuller, 1986). Much of this increase in strategic alliances is due to corporations trying to keep up with the increased pace of technological development and their need to optimize the financial investment and level of quality required for successful research and development (Hagedoom, 1993; Harrigan, 1986; Mowery et al., 1998). Strategic alliances are perhaps most vital in the long run as a means “by which knowledge is transferred and by which firms learn from each other” (Kogut, 1988). As the transfer of knowledge is important for the managers of both organizations, these managers must develop systems to collaborate and learn information from the joint venture. It is also important for the managers to develop skills within the process to provide for the protection of unwanted transfers of proprietary knowledge from their organizations. Managers and organizations can possibly develop information strategies that match their organizational goals and strategies, thus ensuring that they maximize transfers into their organization. By maximizing their receptivity to what is necessary to perform their requirements within the joint venture, and concurrently minimizing their transparency, they protect as much proprietary knowledge as possible. These requirements should be recognized in advance in the agreements establishing the joint venture and in their developing working relationships (Hamel, 1991).
CFCS capabilities offer the project management processes the means to leverage project management systematic and phased formats into an overall knowledge management (KM) program. The KM program is then more able to capture project management information obtained from the environment and facilitate it flow throughout the organizations to where impact on the organization's strategies may be evaluated. Interdependencies linking the internal structure of projects are systematically similar although physically different. The systematic similarities produce information that is transferable and usable within other projects by managers as the organization's knowledge structure is developed and utilized within the project management phases by integration, prioritizing, and communicating within the continuous control phases of one or many projects. The project management rigidity gives KM systems source of specific information, established distribution structure, and distinct phases of knowledge implementation. These attributes give managers the capability to rapidly respond to stimuli from the environment, stakeholders, or to specific occurrences in project stages where knowledge obtained and successfully utilized can be leveraged. These actions assist in the minimization of risks by the information being identified, circulated, monitored, and managed resulting in organizational controls not organizational reactions.
The ability of a manager to absorb information both internal and external to the organization and transform it into knowledge is dependent upon the manager's level of prior related knowledge, the influence of the firm's management control systems, and the firm's “absorptive capacity.” The absorptive capacity is the organization's collective ability to value new information, evaluate it, assimilate it, and apply it to commercial ends (Cohen & Levinthal, 1990). In today's world, the manager's ability is also dependent on CFCS (including the usage of intranet, extranet and/or Internet) and the informational characteristics of the specific knowledge under investigation in this study (i.e., technology). Structuration theory (Giddens, 1984) can assist us in explaining the use of communication technology as a function of how the managers perceive their work, their organizations, and the communication technology including the rules and social contexts of the organization (Barley, 1986; Weick, 1990; Orlikowski, Yates, Okamura, & Fujimoto, 1999). Managers display normal human characteristics when engaged in learning processes. Top managers tend to share information on issues within an organization—even the highly confidential information pertaining to acquisitions (Melone, 1994). Managers tend to utilize interpersonal interactions, their own experiences, and the nature of the organizations to which they belong in order to guide their decisions (Thomas, Shankster, & Mathieu, 1994).
Exhibit 6. Manager's Knowledge Exposure
Measurement Model Assessment
Exhibit 5 presents the internal consistency values for each construct in the Managers' Knowledge Exposure model presenting both the preferred measure of Fornell and Larcker (1981) and Cronbach's alphas (1951). Exhibit 7 reports the inter-correlations of constructs used to assess the discriminant validity of the constructs. The diagonal element of Exhibit 7 is the square root of the average variance extracted. The constructs had acceptable reliability and validity. Two constructs (searching and managerial decision-making) had somewhat lower Cronbach's alphas; however, each of them had acceptable internal consistency values as assessed by the Fornell and Larcker measure. The Fornell and Larcker measure is calculated independently of the number of items employed for a construct, whereas alpha is not, and it thus provides a more robust assessment of internal consistency. Also the approach uses observed loadings reflecting more accurately the relative importance of each of the underlying measures.
Examining Exhibit 7 one sees that the values of the diagonals are higher than the nondiagonals in all cases thus the correlations were less than the average variance extracted, indicating discriminant validity in all cases.
Predictive Power of the Model
Overall the managers' knowledge exposure model explains 71% of the managerial decision-making construct and 60% of the managerial performance construct, indicating there is a high predictive power of the model. Figure 6 indicates the variance explained for the individual endogenous constructs and the estimated path coefficients.
The managers' knowledge exposure model (Exhibit 6) shows two dependent variables, which are managerial decision-making performance and managerial performance. The construct of managerial decision-making performance is indicative of the manager's ability to make better decisions by better visualizing solutions, providing a broader perspective, and improving their ability to develop unique decision processes. The construct of managerial performance is an overall measurement included in which is improving job performance, productivity, expansion of potentials, and providing advantages to them in their job.
Of the four independent variables three are constructs representing the components of the CFCS—searching, intranet, and extranet. The intranet construct captures the direct ties that connect the managers to contacts within their operating units and to the corporate offices. The extranet construct extends the ties to the weak connections between organizations along the managers' organizations' suppliers and customers. This construct further presents the managers contacts with organizations and individuals outside normal business contacts. The searching construct captures the managers stretching to cross structural holes by their seeking ideas outside their existing knowledge base to develop new hypotheses and impressions of unique views and what the future may bring. The fourth independent variable is the construct of managerial learning orientation, which develops the motivation of the managers to use CFCS for their technology-based information. This construct develops managerial networking beyond organizational boundaries to find information including new concepts.
A review of the managers' knowledge exposure model reveals that the indicators to the dependent variables are all highly loaded with the lowest being the expansion of search potential influence on managerial performance and the ability of the intranet to produce unique processes for improved managerial decision-making. The highest loadings for indicators of managerial performance are the improving of performance and of productivity. The highest loadings for indicators of managerial decision-making are for getting impressions that give broader perspectives and Ideas that improve ability to make better decisions. The path coefficients of both the dependent variables from learning orientation and searching were significant. The learning orientation or the managers' motivation to utilize CFCS has the highest loadings from when the managers are investigating technology that relates to their profession. At these times CFCS provide impressions of new concepts and the information that are not available within the organization. The indicators of the searching function have loadings over 0.7. When the managers utilize the searching function of CFCS they most highly regard the focused scanning for unique views of problems and capability to develop new hypotheses for the processes within the organization.
The intranet and extranet constructs had much lower loadings with only one path coefficient being significant—that being the path from the extranet to managerial performance. Within the extranet construct the loadings from external to the supply chain were above .7, whereas those within the supply chain were below 0.7. The loadings of the indicators for the construct of the intranet, which provides communication within the manager's business unit and to fellow employees within their corporation have loadings higher than 0.7 whereas the indicator connecting the manager with friends outside the business unit but within the corporation had a lesser loading. The path coefficients from intranet construct to managerial performance is the only negative path coefficient of the model.
CFCS have a positive effect on the gathering of information for both a manager's decision-making and performance. (This is true for all path coefficients from CFCS except for intranet to performance.) Exhibit 4 contains a summary of the hypotheses, Exhibit 5 indicates the internal consistency measures, and Exhibit 6 indicates the discriminant validity measures.
Exhibit 7. Path coefficients
Exhibit 8. Managers' Knowledge Exposure-Internal Consistency
Exhibit 9. Managers' Knowledge Exposure-Discriminant Validity
Establishing the capability for managers at all levels to retrieve and display information just in time to support a dynamic and demanding decision process can save an organization millions and position it to seize opportunities worth millions more. The key to success is defining the critical data requirements, metrics, analyses, and reports—and then establishing the systems, tools, and training necessary to make them happen. CFCS have improved upon IBM's 1970s Business Systems Planning foundation to time the investment in technology to arbitrate between existing software that offer systems for creating metrics and data, collecting information, and calculating to evaluate their progress. CFCS gives managers the options of seeing the world above the process within projects and focusing on more than just the planned procedures and budgeted costs and profits as displayed in Appendix 1.
RIGIDITY II–Ensuring that distant stakeholders are satisfied—Operationalizing weak ties
The reputation of an organization that participates in a project is dependent on the organization defining and monitoring stakeholder evolution and estimating the final and long-term requirements. Stakeholder requirements and future expectations are what organizations responsible for their projects will have to live with throughout time. The time frame is definite and short as the project's duration, but its results will be evaluated as long as the project and organizations expect to function. Managerial use of CFCS to investigate their future prospective customers, vendors, and stakeholders has an unending historical potential. Reputations as other virtual information extend long into the future and across borders with similar ease. Sarbanes-Oxley Act of 2002 (SOX) is the seed of a radical change in governance of projects and organizations. It matches well the capabilities CFCS give the organization and agencies whose vested interests are also outside project's contract signers. Project managers must ingest this change and make it part of their culture and decision-making processes. Project managers must search for the “weave” of their stakeholders. Stakeholder expectations are a tapestry of not just separate threads of concern that can be satisfied by short term solutions or even the project's final acceptance, but of the expectations, doubts, and concerns of stakeholders external to the project's process. These stakeholders have power to affect the completion of the project, the success of the organizations involved and the reputations that all will cherish in the future. Payment is not the end of responsibility for the signatories to the project's contract. Final acceptance and payment are obviously vital, but in the tapestry of stakeholder expectations are interwoven in its overall landscape. Project managers must clearly envision and respond to these expectations before they walk away from stakeholder questions and the project with complacent feelings.
Stakeholders can be examined by two basic classifications close and distant from the actual effects of the project outcome and by within and outside the project manager's organization. The most obvious and important stakeholder is one that is close to the project outcome but outside the project manager's organization is the project's customer. Project managers use of CFCS is crucial in diagnosing customer intensions. This is especially important for those intentions that underlie customer requests that challenge the status quo. These requests may be outside of the contract and thus easy to place aside, but their importance may be far greater than their legal enforcement. The resultant actions of the project manager may in our words create a new tapestry format closer to the future expectations of more powerful stakeholder who at this time are quiet. These stakeholders and their constituents can impact the long-term outcome of the project. Therefore, project managers' actions should be based on environmental scans of impressions of information further explained in the weak ties of CFCS. Responses to challenges of the status quo require more than contract references or pleas to cooperate. Attempts to persuade and interaction techniques that relate to different behavior styles are primarily aimed at superficial fixes. Motivations of stakeholders particularly customers exhibited by challenges to the status quo to separate individuals from the cooperative completion of projects. These uncooperative actions usually have underlying incentives or reasons. These underlying reasons may be only understood by scanning information sources closer to the customer's vantage points rather than from the projects specifications. Project managers must build their knowledge of this distant knowledge structure on a new perspective developed from the searching for motivated reasons with the potential to develop into universal expectations. Project managers must seek a vantage point more distant than the actual project for which the utilization of CFCS can provide. These weak ties may offer project managers opportunities to find out what they do not know.
(SOX creates stakeholders that are in all quadrants of our framework presented in this section. SOX main thrusts exist in the areas of financial practices and corporate governance regulations. These changes are to “protect investors by improving accuracy and reliability of corporate disclosures,” and projects have the potential to encroach within these legislative boundaries thus affecting our framework in sectors within the organization and close to the project. One may overlook the more sensitive aspects of SOX and that is that SOX is more a creature of the public and media than a legislative stream of financial originated regulations. The public and media origins will for some time to come make the project managers scanning for possible compliance motivations an important aspect of customer and all stakeholder dissidence analysis. As projects are being completed possibly the most influential stakeholder in the organization's future is the public, and the most difficult task of project managers is to analyze and act upon how the trends exhibited by stakeholders will be developed in the new media. The public is now the ultimate stakeholder who must be monitored by project managers to place their expectations into project management problem-solving.
Exhibit 10. CFCS and Problem-solving
Assessment of Model
The internal consistency of all constructs is over .9 with the rule of thumb requiring a minimum 0.7 (Exhibit 9) and their discriminant validity is verified by none of the nondiagonal values being greater than the diagonal measures in Exhibit 11. The predictive power of the model in Exhibit 12—Technology-base Information Typology—Problem-Solving—is the value of R2 for the problem-solving construct of 69%.
Managerial technology-based information is strongly explained by the managers understanding of information through the typology of impressions, ideas and facts. The construct of problem-solving is developed by the managers' search for technology-based information outside of the organization to better visualize problems and identify solutions to problems. The loadings of the problem-solving construct are above .7 except for the information loading which is 0.681. The loadings of the indicators for the independent variables are all above 0.7 and the path coefficients are all significant and in the right direction.
The construct of impressions is indicative of the managers' search for information that gives broad perspectives and unique views to assist in solving problems they will experience in the future. The construct of ideas relates to managerial search for technology-based information related to their job that assists in making better decisions and developing new hypothesis for their work -related processes. The construct of facts relates to what is actually happening in the work environment for the manager to complete a task. The indicators relate to the techniques that managers use to solve work-related problems.
The information typology of impressions, ideas, and facts explained 69% of the construct of problem-solving. Managers recognized the three items of this typology and in all cases significantly associated these to the information seeking activities while using CFCS as hypothesized.
Exhibit 12. Technology-based information typology—problem-solving—corresponding paths
This indicates that managers understand technology-based information related to problem-solving to be a broad-spectrum construct. This spectrum encompasses the application of technological information, the everyday techniques and tools utilized by managers, assistance in processes of the organization by initiating new hypothesis development, and the understanding of trends that may affect them in the future. The scale is a continuum, but the information typology constructs of impressions, ideas, and facts are distinctively different in the minds of managers.
Measurement Model – Internal Consistency
Exhibit 13. Technology-based information typology—problem-solving —internal consistency
Measurement Model – Discriminant Validity
Exhibit 14. Technology-based Information Typology—Problem-Solving—Discriminant Validity
Integrated projects are a fundamental building block of the enterprise implementation process. It is essential that an integrated project plan be developed in conscious alignment with the business case for a program. The process begins with the formation of an initial planning team charged with establishing the credibility of the program by, first, examining the validity of the business case on which it is based and, second, determining distant measurable success criteria. External stakeholders, compliance requirements, and external risks are now capable of being weighed, scored, and compared to outcomes developed within existing strategies. The finding of these emergent strategies and items of knowledge to expand ones MTK is dependent on CFCS being trusted by project managers to effectively and efficiently find locations of experts. CFCS development of project managers trusts to engage information searches to provide not only the visibility of the complex criteria, but also give stakeholders the capability of being included and participating in the increase of MTK. This trust also increases the potential to include an increased reliance on assumptions allowing ones MTK to include more than facts proven only by ones experience and direct answers to questions developed by just the experiences in ones limited background. Governing processes of projects can thus be established from extended stakeholders' perspectives through CFCS supported collaboration within expert networks as well as from projects' participants.
Project managers and organizations must take a long-term view of performance metrics and expectations starting with a vision directed into the future to which the organization will operate. Project managers must question present performance measures that limit oversight to on-time and under-budget project specific goals. Both project managers and their organizations need to establish within existing control systems options to include factors that take advantage of the rapid information gathering and dispersing capabilities of CFCS. Project managers and organizations must develop optimum competitive capabilities of their CFCS by viewing investments in and usages of CFCS not as devices, but as platforms from which they can properly envision how the Information Age and the trends of technological advances will change project managers', organizations' and stakeholders' definitions of performance. The same attributes that we see in CFCS are most probably the items that will alter our standards of performance and create new metrics we will use to measure performance. Project managers must be on the forefront in seeking what metrics will be facilitated by CFCS users and what gaps in performance will be necessary to close to maximize future returns on investments of primarily intangible resources. As intangible resources continue to become of greater value than tangible assets the return on assets ratios will more represent the actual intangible assets rather than the present use of a ratio like ROI just because it has always been used. Tangible assets will decrease in importance while intangible assets will be the focus of project managers, so the gaps between the returns on ones intangible assets compared to another's will need to be a common measurable metric. The organization better able to develop these metrics and accurately measure them will have a significant advantage in the asset procurement market.
The development of tomorrow's perspective on performance will probably come from the items within CFCS that differentiate these systems from traditional systems. Also of measurable importance may be how the characteristics within CFCS will change the outputs of information such as transparency. Transparency is a vital measure for compliance issues within the project management and organizational performance issues and a major construct of our Rigidity II platform. Items impacting the project manager's and an organization's ability to measure its transparency would include the CFCS ability to structure information, which makes information that has high value-added content easy to access, or the capability of CFCS to make this information multimedia and thus available to better influence a wider audience are potential new metrics.
The same is true with the capability of CFCS to impact collaboration on a global scope. Items that facilitate project managers and organizational problem-solving, decision-making, and overall managerial performance are CFCS interactive capabilities (e.g., user-based interactions, intelligent help, functionality, scheduling, information retrieval, tracking, 3-D graphics). None of which are being measured by organizations today, but all of which contribute to the maximization of intangible assets performance.
Exhibit 15. Relative Importance of CFCS Performance Metrics
Our paper so far has addressed three separate focuses that project managers should view their usage of the platform integration of CFCS and project managers should continue their investigation of performance from these three separate focuses—the project, the environment and the stakeholders. The scope and breadth of managers' information gathering should also affect the performance of the individual manager and thus the entire organization. Researchers of executive information retrieval methods report finding significant correlation between the amount of information gathering and increases in performance (Daft, Lengel, & Trevino, 1987; El Sawy, 1985; Thomas & McDaniel, 1990). Executives improved organizational effectiveness and achieved higher efficiencies by obtaining greater amounts of information (Vandenbosch & Huff, 1997). Improved executive performance from broad information gathering manifested itself in better and quicker decision-making (Eisenhardt, 1989; Thomas & McDaniel). Conversely, the more a top management team concentrates itself primarily on scanning for internal efficiency (at the cost of reducing broader environmental inquiry), the lower performance becomes (Miller, 1993; Gill, 1995). Therefore, the author believes that managers with a greater concentration of the broader scanning processes will have a higher performance level and that the scanning process will be a valuable component in the managers' absorption of information.
The process of seeking peripheral information can be explained in a continuum. At one end, the manager scans for information without having a specific purpose (browsing). In the middle, the manager monitors performance by cursory overviews of statements and heuristics. At the other end, the manager performs a “focused search” for a specific item (Aguilar, 1967; Huber, 1991). The majority of executives who perform searches investigate for specific information, finding that the systems they used improved their efficiency. However, the minority of executives who utilized a less specific browsing method of seeking information reported significantly higher effectiveness. The latter's improvements in effectiveness came from insights that the knowledge developed was achieved by challenging their preconceptions and the broadening of their outlooks (Vandenbosch & Huff, 1997). This shift in results relates to the increased creativity experienced by the latter executives, whereas the former executives were entrapped in a process that increased only their task capabilities (Bartlett & Ghoshal, 1995; Ghoshal & Bartlett, 1995). This confinement to task investigation and improvement while using the scanning function has been dubbed the “death spiral” because the adverse impact on the organization due to top management's concentration only on the internal process improvement rather than being knowledgeable of the operations as a whole and integrating responses to the changes occurring in their environment such as improvements from new technology streams (Nadler & Shaw, 1995).
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|Platform 1 |
|Platform 2 |
|Platform 3 |
|FOCUS||THE PROJECT||MULTIPLE PROJECTS; ENVIRONMENT||STAKEHOLDERS|
|ORGANIZATION FUNCTION||CREATING PROJECT KNOWLEDGE||PERFORMANCE; DECISION-MAKING||PROBLEM-SOLVING|
|SYSTEM FUNCTION||COLLECTING & IMPROVING KNOWLEDGE||EXPANDING HORIZONS||INCREASING UNDERSTANDING|
|METRICS||COSTS, TIME||PROBABILITY OF OCCURING||MAGNITUDE OF INFLUENCE|
|RESULT||OPTIMUM EFFICIENT PROJECT COMPLETION||CORPORATE PERFORMANCE||CORPORATE REPUTATION|
Appendix 1. Project Management's Platforms of CFCS and their Operating Characteristics