Value creation in projects: Towards a narrative perspective

Highlights

• Value is in essence a social construct, and the processes of social construction are rooted in language

• Value creation in projects is a process which lends itself to interpretation from a narrative perspective

• There has been shifts in understanding value creation in projects: from 'hard' value engineering to ‘soft’ value management

• Narratives of value on the level of the organisations interact with anecdotal stories which individuals use to make sense of their lived experiences

• Personal values are inherently inseparable from 'identity work'

Abstract

It is contended that value is a social construct, and that the processes of social construction are rooted in language. On this basis we argue that value creation is a process which lends itself to interpretation from a narrative perspective. Previous attempts at value creation have been promoted under the label of ‘value management’. There are two approaches which are identifiable in the literature. The first is based on the traditional narrative of value engineering (aka Hard VM) and is primarily directed towards cost reduction. The second more recent variant is labelled ‘soft’ value management (Soft VM) and is primarily directed towards the achievement of a shared understanding of the value criteria relating to an individual project. The two approaches are critiqued in terms of their underlying assumptions and it is suggested that they are best understood as different forms of narrative. The emerging literature on value creation is similarly critiqued in accordance with the adopted narrative perspective. The distinction is made between formalised narratives of value on the level of the organisations involved in the project coalition and the anecdotal stories which individuals use to make sense of their own lived experiences. Emphasis is given to the ways in which different narratives interact, and to the way in which they remain contestable over time. Particular attention is given to the confluence between storytelling and identity work.

Introduction

There has in recent years been considerable debate about judging project success on the basis of value (APM, 2018; Chang et al. 2013; ICE, 2017; Laursen and Svejvig, 2016; Lepak et al. 2007). The recent emphasis on ‘value’ has in part emerged from the longstanding debate about how to assess project success. The debate has resulted in a significant shift in emphasis within the project community from ‘product creation’ to ‘value creation’ (Winter and Szczepanek, 2008). This shift is indicative of a broader quest to position project management evermore strategically. Martinsuo and Killen (2014) emphasise the importance of identifying and assessing strategic, non-commercial value in project portfolios. In seeking a route forward Laursen and Svejvig's (2016) point towards the established sub-discipline of value management as a promising source of ideas for the project community. They especially highlight the contribution of Male et al. (2007) as having potential in offering an integrated approach which embraces value, benefits and costs. However, they notably neglect the broader theoretical debates within value management and the associated ‘paradigm wars’ within the fields of operational research (OR) (cf. Ackoff, 1987; Keys, 1984; Rosenhead and Mingers, 2001) and systems thinking (cf. Checkland 1981; Mingers, 1980). It is contended that these debates have significant implications for the way ‘value creation’ is conceptualised and enacted within context of projects. It will further be argued that current approaches to value creation tend to reify value and hence treat it as objective commodity which is subject to rational manipulation. In this respect the literature risks replicating previous debates about project success (Ika, 2009; Jugdev and Müller, 2005; Pinto and Slevin, 1988).

The paper is conceptual in nature. It derives its theoretical basis from the ‘narrative turn’ in organisation studies (Rhodes and Brown, 2005; Vaara et al., 2016). Narrative approaches notably remain on the margins of the project management research community, despite a number of significant contributions (e.g. Amtoft, 1994; Boddy and Paton, 2004; Gil 2010; Musca et al., 2014). Boddy and Paton, (2004) contend that competing narratives are inevitable in major projects as a consequence of the conflicting subjective interpretations of different interest groups. They further argue that there is a need for project managers to create structures within which these competing narratives might be managed. Havermans et al., (2015) are much stronger in terms of their reliance on narrative theory, and notably place language at the very centre of project organising. They further draw convincingly from narrative sources such as Boje et al., (2004) to argue that language is constitutive of organisational reality rather than merely representative. It is not necessary to accept this view in its entirety to contend that value is a social construct, and that the processes of social construction are rooted in language. It is on this basis that we argue that value creation is a process which lends itself to interpretation from a narrative perspective.

The research problem the paper seeks to address is the longstanding lack of progress in respect of how through-life value creation should be conceptualised and enacted in the context of projects. It is contended that the recurring failure of attempts to reify value requires a radically different approach from those which have prevailed to date. The adopted style of the current paper is deliberately provocative in an attempt to challenge current institutionalised ways of thinking. The arguments are primarily aimed at the project management research community, but lessons are also offered to practitioners not least in terms of how they might better position themselves within current debates.

The essential proposition is that ‘project value’ is best understood as a social construct which is continuously contested amongst project participants. Kreiner (2014) has similarly argued that project success is a matter of negotiated agreement as much as objective achievement. The difficulty with project success is that any definitive judgement depends upon a negotiated reconciliation of differing perspectives amongst project stakeholders, and any such reconciliation is unlikely to remain stable over time. The same argument also prevails in the case of project value. In this paper we adopt the position that value is an entirely abstract concept which is continuously shaped and contested through narrative. This is especially true in the case of the non-commercial strategic value to which Martinuo and Killen (2014) allude. To be clear, the adopted position is that there is no underlying ‘reality’ of strategic value which exists independently of narrative. We would further contend that the narrative of value creation is popular because it serves to enhance the status of project management as a discipline, and that of the individual project managers who seek to justify their actions in these terms. Hence we ultimately interpret the continued advocacy of value creation as ‘identity work’. Such an interpretation leads to a research agenda for value creation which stands in sharp contrast to those currently advocated.

The adopted perspective is in part a response to an increasing appetite for alternative theoretical perspectives within the international research community relating to the ‘management of projects’ (cf. Cicmil and Hodgson, 2006; Smyth and Morris, 2007; Söderlund, 2004). We would recognise however that the majority of popular project management textbooks and bodies of knowledge continue to be based on an implicit realist ontology (Gauthier and Ika, 2012). Hence the argument that value is socially constructed through narrative may seem strangely ‘unscientific’ to many within the project management research community. For this reason we go to some length to emphasise the limitations of currently favoured approaches to value creation prior to advocating the case in support of a narrative approach.

The paper is structured as follows. First, attention is given to the concept of through-life value creation as currently advocated in the project management literature. Next, consideration is given to the ‘paradigm wars’ which characterise the established sub-discipline of value management. Despite prolonged interest in value management amongst project scholars, there has to date been limited engagement with such theoretical debates within the mainstream project literature. However, rather than position competing paradigms of value management in opposition it will be argued that they comprise complementary ‘ways of seeing’. In this sense the argument broadly concurs with previous pleas for pluralism in project management research (Söderlund, 2011; Stingl and Geraldi, 2017). However, the discussion extends beyond schools of thought vis-à-vis research to question the extent to which such paradigms can ever be enacted in practice. Thereafter, the theoretical basis of value creation as currently advocated within the project management literature is reviewed and critiqued. It is considered especially important to challenge the recurring tendency in the literature to reify value and hence render it manageable by rationalistic methods. Attention is given more broadly to the theoretical elusiveness of value creation as currently conceptualised. This is seen to comprise a significant barrier to the development of a theoretically-informed research agenda. The discussion encompasses creative projects in addition to the more usual focus on capital projects. Particular attention is given to ‘value management as a methodological style’ as notably endorsed by Laursen and Svejvig (2016). The critique is further extended to those approaches which rest on the reification of ‘client value systems’. The paper is concluded by the articulation of the advocated narrative perspective on value creation with appropriate recommendations for further research.