Project business as a research field

The Authors

Karlos Artto, Finland Industrial Management, Helsinki University of Technology, Espoo, Finland

Jaakko Kujala, Finland Industrial Management, University of Oulu, Oulu, Finland

Abstract

Purpose – The purpose of this paper is to introduce project business as a research field. The project business view in this paper puts focus on the management of firms and their businesses, and this way the paper complements the existing project-centric view of the role of projects and their management in various business contexts.

Design/methodology/approach – The paper proposes a conceptual framework for project business and identify relevant research areas and themes. These research areas and themes are derived by using the knowledge and experience obtained from scientific project business research conducted in Finland since the early 1990s.

Findings – This paper describes project business as a research field by introducing a project business framework and the four major research areas inherent in the framework: management of a project, management of a project-based firm, management of a project network, and management of a business network. It also suggests specific research areas and themes within the framework that are relevant and contribute to new knowledge in the project business field.

Practical/implications – The project business framework described in this paper, including the suggested research areas and themes, is important in focusing research and for development of practical application of project-based business activities in firms and in public organizations.

Originality/value – The paper reveals avenues that lead towards the development of a new body of knowledge for project business that focuses on managing both firms and projects effectively in their networked business environments.

Article Type:

Research paper

Keyword(s):

Project management; Project planning; Business planning; Finland.

Journal:

International Journal of Managing Projects in Business

Volume:

Number:

Year:

2008

pp:

469-497

Copyright ©

Emerald Group Publishing Limited

ISSN:

1753-8378

Introduction

The significance of project business is increasing. Recently, project-based business activities are part of all private firms and public organizations. Although existing studies analyze projects, firms, and business, and practitioners increasingly refer to project business, the concept of project business as a research field has remained ambiguous. The contemporary critical project research attempts to seek new perspectives to projects and their management by adopting a rather project-centric point of departure; in addition, many existing critical project studies focus on organizational issues. This paper complements these existing project-centric and organizational views by concentrating primarily on the management of firms and their businesses.

The approach of this paper is to analyze the project business field and simultaneously to provide an original definition for project business through its relevant themes. This paper has two objectives to:

describe project business as a research field through introducing a project business framework and the four major inherent research areas; and
suggest specific research areas and themes that are relevant and contribute to new knowledge in the project business field.

This paper is divided into two parts that are in line with the two objectives. The first part introduces a project business framework that makes a distinction between four major areas. In the second part of the paper, the project business framework is applied to analyze project business as a research field. We suggest relevant research areas and themes by analyzing existing and emerging research. Our analysis is facilitated by the use of the knowledge and experience from the scientific project business research conducted in Finland since the early 1990s. The conclusions of the paper is a description of the whole project business research field by means of several specific research areas that are considered relevant for future research and also for empirical application in firms and in public organizations.

Project business framework

Project research is expanding its view towards wider aspects of project business. Artto and Wikström (2005) define it as: “Project business is the part of business that relates directly or indirectly to projects, with the purpose of achieving objectives of a firm or several firms.” This definition refers to multiple projects and multiple firms. Also Söderlund (2004) uses the dimensions of single vs multiple projects, and single vs multiple firms, while categorizing project research published recently in one mainstream project management journal and in major management and organization journals. Engwall (2003) emphasizes the imperative of understanding the project's context and not simply the project as an isolated whole.

Indeed, both projects and firms are organizational entities that represent relevant players in the business context. Furthermore, the business contents of multiple projects and multiple firms are often related in a complex manner. The project business framework in Figure 1 shows major areas of research and of managerial application with a single and with several firms, and with a single and with several projects that may cross one or several firms' business activities. The project business framework illustrates four distinctive areas under the headings:

management of a project;
management of a project-based firm;
management of a project network; and
management of a business network.

The areas differ as to whether the object of the management is a project, a project-based firm, a project network, or a business network.

The management of a project is an area which is well-researched. The existing extensive research in this area makes the field of management of a single project rather well known. This well-known project management knowledge has been developed throughout the last 60 years of modern project management (Morris, 1994). The standard documents of project management currently issued by international project management organizations represent an excellent overview of what the management of a single project includes in its application area (ISO, 1997; PMI, 2004; IPMA, 2006; APM, 2006). International project management organizations have built their own project management guidelines upon knowledge areas (or processes) included in project management, which should prove useful for project management practitioners and for company users (Morris et al., 2006). It is typically maintained that project management consists of the following broad areas of knowledge (or processes) that all include procedures, methods, and tools that are characteristic of project management: project integration management, scope management, schedule management, cost management, resource and personnel management, communication management, risk management, procurement management, and quality management. These project management knowledge areas are also addressed frequently in the themes of management studies in mainstream project management journals:

The management of a project area addresses the management of a single project rather than a firm's business, although the existing literature in this area often makes an underlying contextual assumption that the project is conducted under the governance of one parent firm/organization.

This area serves as a fundamental basis for the advancement of the research on project business.

The management of a project-based firm is an area which addressing the managerial issues of a firm that conducts a specific part of its activities in a project form. Conducting part of the firm's business through projects may involve projects of two types: external production or customer delivery type projects, and internal development or capital investment projects. For example, a system supplier firm typically runs external customer delivery projects in what can be considered its “production line” of projects. Furthermore, new product development or process development, or any other innovation activity, are good examples of activities that can be organized in any company in the form of internal development projects. Some firms may conduct just part of their operations in project form even while their primary productive activity might be volume-based or operations-oriented, while some firms may organize most of their internal and external activities in projects (Hobday, 2000). The management of a project-based firm area is a rather new research area that includes research primarily on a firm's management ability and consequently the capacity of the firm to initiate and execute projects that either directly or indirectly benefit the firm's business. Projects are seen as the firm's business vehicles. The management of the project-based firm area includes research on the project supplier firm's ability to sell and deliver projects to its customers (Cova et al., 2002), management of innovation (Gann and Salter, 2000), and research on project portfolios (Archer and Ghasemzadeh, 1999) and development programs (Pellegrinelli et al., 2007).“The management of a project-based firm area addresses managerial activities of a firm that are in place for governing/managing multiple simultaneous or sequential projects for the firm's business purposes.”

The management of a project network is a management area that covers a network including several firms and other organizations from different businesses and from different institutional environments that are participating in a project. The network of firms and other organizations participating in a single project is called a project network (Hellgren and Stjernberg, 1995), a project-based enterprise (DeFillippi and Arthur, 1998), or a project coalition (Winch, 2006). The management of a project network area represents an area of novel research themes that relate to interpreting a project as a multi-organization enterprise (Grün, 2004) that involves a complex network of firms and other actors in its execution. A project network has an intentionally constructed core of actors that participate in the project (Williams, 2002), however, a project network may also include other actors that are the project's stakeholders (Floricel and Miller, 2001). A project network is a temporary endeavor which includes several phases, each of which are different in nature (Morris and Hough, 1987; Slevin and Pinto, 1987), and is a continuously evolving constellation of actors in ever-changing roles (Eccles, 1981; Dubois and Gadde, 2000). These characteristics make project networks highly dynamic:

The management of a project network area addresses the management of the temporary project across multiple participating firms and other actors that each have their own (and obviously controversial) objectives, interests and expectations from the project, as based on each actor's different business objectives in their permanent businesses.

The management of a business network is another area which includes novel research themes that relate to several firms' activities, where the firms engage from time to time in mutual projects. The actors in the business network can have aims that are synergistic, and accordingly, there is room for partnership and collaboration (Davis, 2006; Arroyo and Walker, 2008; Davis and Walker, 2008). It can also be the case that the aims of the actors in the business network are contradictory and conflicting, which implies adverse relationships, competition or rivalry. Networked firms and their business relationships affect the selection of participating firms in a project, and vice versa, the projects have an impact on the permanent businesses network (Eccles, 1981; Håkansson et al., 1999). Firms may participate in different projects in different roles, and each project may have different set of actors (Eloranta, 2007). Project supplier firms may engage in several sequential or parallel global projects through different delivery scopes (Cova et al., 2002). The roles of the actors may change from one project to another, making a partner company in one project a competitor in the next project, or the customer in one project a supplier in the next project. Hellgren and Stjernberg (1995) argued that there is a dual relationship between project network actors, while organizations have a simultaneous mixture of opponent and partner relationships: for example, a short-term partner may become a competitor in future projects, and vice versa. A business network includes, for example, competitors, financiers, customers and their clients, contractors and their subcontractors, suppliers, designers, architects, manufacturers, service providers, integrators, and consultants (Davies, 2004). We consider the concept of business networks in a broad way by recognizing that non-business actors also belong to the network; examples of such non-business actors are authorities, governments, municipalities, politicians, labor unions, public and citizens' assemblies, and environmentalist groups:

The management of a business network area includes activities in a rather open and wide business marketplace including several firms and their business interests. Furthermore, the marketplace includes at any one point in time multiple projects that serve as temporary business vehicles for several firms' permanent businesses.

Based on the discussion above, Table I concludes the basic characteristics and the distinctive contents of the four major areas in the project business framework.

Research areas and themes in project business

In the following sections, we analyze relevant areas and themes of project business in the four major areas in the project business framework. Our analysis draws mainly from the scientific project business research conducted in Finland. Project-based organizations have played an important role in Finland, where project business was recognized as an specific research field already in the 1990s. The following events are examples of activities of Finnish origin that have increasingly brought the topic of project business into discussions in both contemporary business life and in academic circles: the establishment of a professorship in the area of Project Business since 1996 at the Helsinki University of Technology; the Global Project Business national technology program between 1998 and 2001, funded by the Finnish Funding Agency for Technology and Innovation; the international Nordnet 1999 conference on the theme of Managing Business by Projects; the international IRNOP 2004 project research conference on Project Business and related themes; the article on “What is project business” in 2005 by Artto and Wikström (2005), and; the book on Project Business in 2006 by Artto et al. (2006).

A special issue of Organization Studies in 2004 focused on project-based forms of organizations and discussed challenges related to various forms of project networks and project ecologies (Sydow et al., 2004). Recently, the concept of project business has also arisen in many international arenas; this is indicated, for example, by the book The Business of Projects by Davies and Hobday (2005), since 2008 by Emerald's new journal – the International Journal of Managing Projects in Business, and by the Project Business symposium in the Academy of Management annual meeting in 2008. In addition to these firm-management-focused and business-focused scientific outcomes and events, the research network for “rethinking project management” (Winter et al., 2006) and “critical project research” (Hodgson and Cicmil, 2006a, b; Clegg et al., 2006) represent major attempts to challenge traditional views to projects and their management. These “rethinking” and “critical project research” movements adopt novel project-centric and organizational views to understanding projects and their contexts in different ways. Our paper could be also thought of to represent an attempt to complement this existing “rethinking” and “critical” research through its firm-centric and business-centric views contained in the concept of project business.

Management of a project

Project management research focuses on the problem of managing a single project effectively and successfully. Management of a single project is an extensively researched area since the emergence of the modern project and program management which took place between the 1930s and 1950s (Morris, 1994). Organizational theories have been widely used in project management research since the 1950s (Stinchcombe and Heimer, 1985; Morris, 1994). Projects have been increasingly defined and researched as temporary organizations; for example, see “Project management and temporary organizations” a special issue in the Scandinavian Journal of Management in 1995 (Lundin, 1995; Lundin and Söderholm, 1995; Packendorff, 1995).

Management of risk and uncertainty (Kähkönen and Artto, 1997; Chapman and Ward, 2002, 2003; Perminova et al., 2008) has been a widely researched and developed area in contemporary project management research since the 1980s. However, so far the focus on project risk management has been on the internal processes of a well-defined and often hierarchical project management system, rather than on the governance mechanisms of a networked, complex and dynamic system that would rely on an open system view on projects. Contingency theory suggests that project management approaches should be tailored to take into account different situations and different project contexts: Turner and Cochrane (1993), Shenhar (2001) and Shenhar and Dvir (2004) are examples of recent studies that compare different effective project management approaches in different environments. The concept of project strategy – referring to the strategy of a single project – is addressed in Morris and Jamieson (2004), Patanakul et al. (2006), Shenhar et al. (2007) and Artto et al. (2008b, c). Inside-out management of a project's interface to its context has been raised in relation to the discussion of moving power towards the edge or towards the project's boundaries effectively. An organization's –, e.g. a project organization's – relationship with its context can be thought of in terms of the “power to the edge” philosophy (Alberts and Hayes, 2003, 2007; Moffat, 2003) which refers to a network centric organization and network enabled capability for addressing mission challenges in the context. Project's relation to its context is also researched in terms of the project's isolation from and integration with its parent organization (Lundin and Söderholm, 1995; Packendorff, 1995; Martinsuo and Lehtonen, 2007b, c; Lehtonen and Martinsuo, 2008).

Table II shows the relevant research areas and their specific themes in the major area of “management of project”. The common characteristics of all the research areas and themes displayed in Table II is that they all put a significant emphasis on the challenge and requirements that the project's environment introduces as to how a single project can be managed effectively.

Management of a project-based firm

Lindkvist (2004) argues that a project-based firm is an organization that conducts most of its work in projects and/or has an emphasis on the project dimension rather than on the functional dimension of its organizational structure and processes. Hobday (2000) makes a distinction between project-based and project-led organizations: according to Hobday, project-led organizations are firms in all types of industries that are undertaking projects as a growing part of their operations even while their primary productive activity might be volume-based or operations-oriented, while project-based organizations organize most of their internal and external activities in projects. However, we adopt a broader definition of project-based firm, by assuming that the definition also covers “project-led” (Hobday, 2000) firms that undertake projects only as a part of their operations. Conducting or enhancing the firm's business through its projects involves projects of two types: external production or customer delivery type projects, and internal development or capital investment projects. There is an emerging research field addressing the management of project-based firms (Artto et al., 1998, 2006; Turner and Keegan, 2001; Arenius et al., 2002; Artto and Wikström, 2005; Whitley, 2006). The conceptual analysis by Artto (2001) provides an overview of the management of a project-based firm and its central concepts and applications by addressing the following questions: how is the project interrelated with other organizational structures such as other projects and the line organization, what roles does a project play in fulfilling the strategic objectives set by the firm's management, and what are the appropriate procedures for managing projects with the purpose of producing a profit. Kujala and Artto (2000) address performance management in project-based firms by setting targets for individual projects. Project supplier firms may engage in several sequential or parallel global projects through different delivery scopes (Cova et al., 2002). Artto et al. (1998) presented a study of global project business by examining Finnish global firms. Recently, there is an increasing amount of research and managerial applications concentrating on the management of public organizations as project-based “firms” (Hawk and Artto, 1999; Artto and Dietrich, 2004; Lindeman, 2007; Martinsuo and Lehtonen, 2007b, c).

Innovation in project-based firms is an important research area (Gann and Salter, 2000; Keegan and Turner, 2002). Artto (2001) and Arenius et al. (2002) discuss the learning loop of a project firm, which should in an ideal situation integrate both horizontal and vertical learning. Such a learning scheme is probably the most important capability that a project-based firm should have. Learning is also associated with innovation, the uniqueness of each project, and the discontinuity between projects, all require that learning and knowledge sharing have a central role (Sydow et al., 2004).

The business of a project-based firm can be addressed through its business model. Kujala et al. (2007) analyze contingency factors affecting both the choice of a business model for a project-based firm and the performance of its business model. A business model can be considered a statement of how the company makes money (Stewart and Zhao, 2000) or how technological inputs are transformed into economic outputs (Chesbrough and Rosenbloom, 2002). A business model with a strategic focus is defined in terms of the logic of profit generation. An operationally-focused business model concentrates on the internal processes that enable the firm to create value, such as production or service delivery methods, administrative processes, resource flows, knowledge management, and logistical streams (Morris et al., 2005). The integration of project sales and execution in a global project supplier firm is challenging: the sales organization may be distributed into several local sales offices, whereas the organization responsible for delivery project execution may be more centralized, situated in few locations as specialized project execution units (Lampenius, 2006; Dietrich et al., 2007). The discourse of project marketing identifies central features of the business of a project-based firm. These central features are: the uniqueness of individual projects, the complexity of the project offering and business network, the discontinuity of demand and business relationships between projects, and the considerable extent of financial commitment of the parties (Cova et al., 2002; Mandják and Veres, 1998; Tikkanen, 1998). The broad project marketing discourse can be identified in the industrial marketing and purchasing (IMP) research group related studies on relationships and networks in project marketing (Cova et al., 1996; Owusu, 2003; Skaates and Tikkanen, 2003; Skaates, 2000). Murtoaro and Kujala (2007) and Kujala et al. (2007) address various negotiation strategies and joint decision making between project customer and supplier during the sales and delivery process. Procurement and supplier network management is important due to the trend of increased subcontracting and focus on a firm's core capabilities. Indeed, firms and projects are more and more dependent on their suppliers (Walker and Rowlinson, 2008), and therefore the relational focus in subcontractor selection criteria is relevant (Eloranta, 2007).

Meklin et al. (1999a, b) introduce a product-oriented approach towards project supplier firms. There is a clear distinction between the concepts of project product and company product (Meklin et al., 1999a, b; Hellström, 2005). Hellström (2005) studies modularity in the business of delivering projects. Hellström argues that the products and their modularity do not only apply to physical products, but also to project processes and project organization that represent the ultimate capability to create the desired solution as the outcome of the project. Goods or services produced in a project are often credited with the attribute of complexity as they consist of a large number of interacting parts. The interaction often creates great interdependency, not only from an engineering design perspective, but also in an organizational sense (Hobday, 1998; Sosa et al., 2003). The choice of product structure and organizational architecture interacts (Henderson and Clark, 1990; Oosterman, 2001). One key issue is how to align service and project processes with the overall business processes in a project-based firm (Gann and Salter, 2000). Research on services provided by a system supplier firm is focused mainly on customer value of post delivery services for major system deliveries (Oliva and Kallenberg, 2003; Helander, 2004). Artto et al. (2008e) adopt a project supplier view and analyze how services influence the performance of project business.

Project portfolio management research includes a wealth of decision-oriented generic process models for strategy implementation with multiple projects (Cooper et al., 1997a, b, 1998a, b; Archer and Ghasemzadeh, 1999; Artto, 2001; Aalto et al., 2003). Recent research focuses on portfolio management performance, contextuality of project portfolio management, and the interface between management of individual projects and management of portfolios (Martinsuo and Lehtonen, 2007a; Müller et al., 2008). Aaltonen (2008) analyzes co-selection in project portfolio prioritization through a population ecological view on top management's activities with innovation project portfolios.

Table III shows the relevant research areas and their specific themes in the major area of “management of a project-based firm”. From the contents of Table III we can draw the conclusion that the management of a project-based firm that is specialized in project operations differs considerably from the management of a firm that conducts repetitive production or routine activities in its business.

Management of a project network

A project typically involves several organizations for its execution. Therefore, the network perspective when considering a project as a network of multiple firms or organizations is most relevant (Hellgren and Stjernberg, 1995; DeFillippi and Arthur, 1998; Floricel and Miller, 2001; Windeler and Sydow, 2001; Sydow and Staber, 2002; Eloranta et al., 2006, 2007). Several actors participating in a project network causes uncertainties that are often due to: network effects such as dependence on other actors; interest asymmetries; different identities; missing information; information asymmetry within the network; social and institutional risks, network risks; trying to behave rationally, and; risk management procedures that do not fit into a networked context (Hellgren and Stjernberg, 1995; Eloranta et al., 2006; Klemetti, 2006; Artto et al., 2008a). The research on large projects and global projects typically capture the idea that the project is a network of several firms and other organizations from different businesses and from different institutional environments participating to the project (Morris and Hough, 1987; Kharbanda and Pinto, 1996; Miller and Lessard, 2001a, b; Williams, 2002; Horii et al., 2004; Orr, 2005; Mahalingam and Levitt, 2007; Ruuska et al., 2008; Scott, 2008). A project can also be considered an enterprise that engages several firms and other organizations that relate to its business purpose (Morris, 1983; Grün, 2004; Murtoaro, 2006).

From the supply chain perspective, a project delivery chain is defined as a network entity formed by several projects built in a hierarchical fashion where the supply relationship is depicted with respect to the customer's (or buyer's) project above and the buyer-subcontractor relationship to the subcontractor's project below (Artto et al., 1998; Kärkkäinen et al., 2002). Stakeholder management studies in project research adopt a partial network view of the project network around a focal firm/organization. Winch and Bonke (2002) and Winch (2004) distinguish between proponents and opponents among project's stakeholders. Walker et al. (2008) discuss stakeholder management in a supply chain type network of actors. Many project stakeholder management studies focus on analysis tools such as the power/interest matrix (Johnson and Scholes, 1999), stakeholder mapping tools (Winch, 2004), stakeholder categorization and visualization tools (Bourne and Walker, 2006). The recent research of Aaltonen et al. (2008), Aaltonen and Kujala (2008) and Aaltonen and Sivonen (2008) widen the project stakeholder management perspective significantly by analyzing different types of influence strategies of stakeholders and of the focal company (for general stakeholder research, see Freeman, 1984; Donaldson and Preston, 1995; Mitchell et al., 1997).

Governance in project networks relate to the management of relationships between the various parties that are engaged in the project that is a temporary multi-organization grouping (Cherns and Bryant, 1984; Winch, 2006). The meaning of governance is derived from the literature on institutional economics. The early work of Coase (1937) identified the market and the firm modes of allocating resources in a market economy, which insight has developed by Williamson (1985) and others in what has become transaction cost economics as one branch of institutional economics. Newer forms of relationships are considered hybrid forms of the hierarchy-market dimension (Spina and Zotteri, 2000). Based on the above, Winch (2006) defines project's management as the commercial function of selecting and maintaining the appropriate governance arrangements between independent firms. A project network is a part of a broader governance framework that includes the context of incentive systems and distribution of risks and resources in the market (Winch, 2006). Incentivization through contracts is emphasized, which implies that contractual relationships and contract organization for a project play central roles (Levitt and March, 1995; Turner and Simister, 2001). Related to this definition, Jones et al. (1997) introduce what they call a general theory of network governance. Furthermore, Klakegg et al. (2007) discuss characteristics of innovative governance frameworks for public investment projects. In addition to transaction cost economics, agency theory (Eisenhardt, 1989) as another conceptualization of the institutional economics has been suggested as the theoretical foundation for the governance in project networks (Turner and Müller, 2003; Winch, 2006). Important suggestions about the governance of large projects are as follows. Organizational structure of a project with the use of contractors, the shaping of the project, the project's institutional framework and the capacity of governance and self-regulation are essential (Miller and Lessard, 2001a, b; Miller, 2006). The owner's competences and interests in putting resources into the process and carrying the responsibilities are crucial (Morris and Hough, 1987; Grün, 2004; Miller, 2006). It is the responsibility of project owners to establish the project management structure (Miller, 2006). For example, based on an empirical evidence from an analysis of a large project, Brady (2007, 2008; Brady et al., 2007) argued that effective principles of governance in the researched megaproject included the following: the owner accepted all relevant risks in the framework agreement (the owner also agreed to partially bear contractors' risks/concerns as to future projects), incentive-based contracts, and interest alignment and identity building of the core integrated team. The financing party's involvement in an early phase is vital, as this helps to shape the project right from the start and the financier's commitment to objectives would guarantee their support when financing the later phases of the project (Flyvbjerg et al., 2003; Samset, 2003). Extensive use of contractors release the owner's capacity and enable the owner to concentrate on core tasks (Grün, 2004). However, the owner should not mix firm prices and reimbursable contract forms, i.e. the owner must not allocate such risks to the contractor that relate more naturally to the owner's business and are therefore more appropriate to keep under the owner's responsibility (Morris and Hough, 1987). There should be balanced authority and responsibility among the different stakeholders (Morris and Hough, 1987; Grün, 2004).

Table IV shows the relevant research areas and their specific themes in the “management of a project network” major area. Based on the analysis of the contents of Table IV, it is obvious that the management of a project network with multiple firms introduces a setting that can be considered opposite to the traditional expectations of the mutual roles of projects and firms. This means that traditionally, the firm is considered the focal enterprise and management across its projects with a portfolio view is expected to represent a typical managerial setting. Concerning “management of a project network” area in Table IV, the situation is the opposite: the project (network) is the focal enterprise, and from the viewpoint of this project enterprise, the challenge is in managing the entire portfolio of firms that are participating in its business scheme.

Management of a business network

In general, the increase of networks of organizations is due to: increased outsourcing, liberalization and de-regulation, the challenge of complexity and scattering of various special capabilities to several organizations, technological convergence, solutions in information and communication technologies, and digitization. The business relationships in the permanent business network of firms affect the composition of those firms that are selected to participate in a project, and vice versa, the projects and their temporary networks have an impact on the permanent business network (Eccles, 1981; Hellgren and Stjernberg, 1995; Håkansson et al., 1999; Dubois and Gadde, 2000; Beach et al., 2005; Ahola et al., 2006; Arroyo and Walker, 2008; Artto et al., 2008a). Also facilitating government or institutional agencies may serve in the central role of business incubators that affect the project constellations (Doz and Hamel, 1998; Porter, 1998). Grabher (2002, 2004) acknowledges the importance of project ecologies or regional agglomerations of project based organizational and institutional participants; the “project ecologies” arena is where economic geographers are contributing to understanding of project business as an inter-organizational phenomena. The firms may participate in different projects in different roles, and each project may have separate set of actors (Eloranta et al., 2006; Eloranta, 2007). Furthermore, a project supplier firm's delivery scopes vary in those several sequential or parallel projects that the supplier firm engages in Cova et al. (2002). Interests and goals between business actors or non-business actors in the business network can be controversial, conflicting or competitive, which may introduce barriers to a project's activities, or political behavior that complicates the execution of a project in a setting where different parties try to use their power to impact the project so that it will be in accordance to their business interests (Lamberg et al., 2008).

There are several business strategies that the project firm can use for effectively competing in the global projects marketplace (Mintzberg et al., 1995; Floricel and Miller, 2001; Walker et al., 2008). Performance measurement in multi-firm supply network is relevant for obtaining a perspective across several firms about their collaborative and competitive positions in the business network; Kujala et al. (2007) introduce a performance measurement system design that also includes performance measurement at the business network level in multi-firm supply networks. Project delivery business is characterized by discontinuity, which means that between two active sales and delivery projects there is a “no project” phase – or “sleeping phase” – that introduces discontinuity to the relationships between the project customer and the project supplier (Hadjikhani, 1996; Cova et al., 2002). Many project supplier firms have included a wide set of services in their offerings in order to overcome the challenges caused by discontinuity. One purpose of such wide service offering is to make the firm's activities and business relationships with other parties in the wide business network more continuous (Artto et al., 2008e). A significant strategic question for companies involved in project activities in the business network is, where in the value stream does the company want to concentrate its value-adding activities (Davies, 2004; Davies and Hobday, 2006)? A firm's search for its position in the value stream with potential downstream moves relates to the discussion of the role of services in the business of a project-based firm.

Table V shows the relevant research areas and their specific themes in the “management of business network” major area. Based on the content of Table V, we can conclude that the business network represents a dynamic context for firms and projects that are characterized by various parties and their various business interests. In this dynamic environment both competition and collaboration, and both conflicting and synergistic interests and activities occur simultaneously at the level of projects, firms, and their partial networks.

Conclusion and further research

In this paper, we introduced a project business framework, which was applied to describe project business as a research field. The project business research field includes several specific research areas and themes that are relevant for future research (Figure 2). These research areas also reflect practical management areas that should be the developmental focus for future management applications in today's industries and in the public sector.

We welcome future studies that will expand both the scientific and practice-oriented foundations of project business. Especially, we suggest three areas for further research. First, we suggest that future research should elaborate on the content of the project business framework, by analyzing recent relevant research content not only within each of the four major areas (as we did in this paper), but also within each of the four interfaces in between the four major areas (the four interfaces are marked in Figure 2). Second, further research should also seek various scientific foundations for each research area in the project business framework. Third, new knowledge is needed about the inherent system dynamism, cause-effect chains, feedback loop dynamics, vicious or virtuous circles, and the relationships between various parameters within the areas and interfaces of the project business framework.

Figure 1Framework of project business: four distinctive management areas

Figure 2Project business framework with specific research areas and themes

Table ICharacterizing the project business research field: distinctive contents of the four major areas of the project business framework

Table IIResearch areas and themes in the “management of a project” major area

Table IIIResearch areas and themes in the “management of a project-based firm” major area

Table IVResearch areas and themes in the “management of a project network” major area

Table VResearch areas and themes in the “management of a business network” major area

References

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