Relational Capabilities in Projects

Maria Kapsali

Umeå School of Business and Economics

• Relational capabilities (the set of routines that support exchange and interaction)

• They are the basis for other project capabilities (e.g. learning, knowledge management, product development)

• Depend on the routinization of relational activities (formal, informal communication, negotiation, exchange of ideas, aligning interests etc. more on appendix)

What is a Relational Capability

• The gap: we do not know which relational activities at the micro level get routinized and become significant to build relational capabilities

– Routines have been difficult to measure since we did not have analytical tools to find complicated combinations of activities

• The question: which relational activities become routinized into relational capabilities

• The contribution: This study shows how empirical research using qualitative comparative analysis can measure systematic and valid patterns of routines at the micro level, an area of research that is significantly weak in both the strategy and the project literatures. The identification and explanation of routine formation will enhance the theoretical conceptualization of capabilities and explain their use in the practice of project management.

The problem

What we know

• Main themes in previous studies: learning, network ties, trust, culture, participation-dominance, consent-negotiation, network characteristics, stability, reflexivity and hierarchy

– Relationships are important to develop project capabilities (learning and knowledge)

– Relational competence and interaction processes in intra or inter-organizational relationships, client-contractor relations, learning processes and stakeholder interaction

– Intra-organizational networks focus on supply relations to create a competitive advantage (more embedded less ephemeral)

– Inter-organizational networks show how projects become relational ‘bridges’ across networks of organizations (lack a hierarchical structure and activities span across boundaries and rely on trust and opportunism)

– Weak ties in projects rely on segment pools and the exercise of controlled redundancy

• Qualitative Comparative Analysis (QCA) is a configurational set theoretic method to measure the combination of activities within relational routines that is significant

• Used in strategic management research to explain the complex interdependencies between industrial, corporate and business-unit attributes that underlie business performance (Greckhamer et al., 2008)

• QCA is used here to investigate which (combinations of ) relational activities are significantly routinized to become relational capabilities

• 17 multiple cases, based on healthcare innovation consortium projects funded by the EU FP program, based on interviews with project managers and participants, project reports and evaluations

The method

The metrics: measuring routinization of relational activities

• 6 groups of relational activities (or components): Realisation Capability, Assessment Capability , Access to knowledge, Access to opportunity, Co-Adaptation, Co-Innovation (13 relational activities included in all)

• 5 routine properties: Measure regularity- variation- recurrence and uncertainty

– Purposeful planned goal led interaction with a clear agenda

– Scaffold or emergent feedback– judgment led interaction

– Frequency of repetition of action-sequences become pre-planned and automatic

– Frequency of interruptions Contingencies Changes pervasive uncertainty

– interactional principles are uncertain and need to be discovered novelty

(definitions in appendix)

Relational capability

components

No of

projects

Activities No of

projects

Configurations Consist

ency

Cover

age

Realization capability 10 MARKET 9 purpose*repetition*novel*situatedact 1 0.44

Assessment capability 16 PRIOREX 14 purpose*repetition*~interrupt*situatedact

purpose*repetition*~novel*situatedact

1

1

0.78

0.71

ALIGN 11 purpose*repetition*~interrupt*situatedact 1 0.72

Access to opportunity 9 IDEAS 9 purpose*repetition*~interrupt*~novel*sit

uatedact

1 0.66

Co-adaptation 9 ADJUST 3 purpose*repetition*~interrupt*situatedact 1 0.75

DESIGN 8 purpose*repetition*~interrupt*situatedact 1 0.5

Finding: three out of the six relational components (realization, access to opportunity and assessment capability, whilst the co-adaptation component was borderline) were routinized by four significantly repeatable activities (alignment of interests, contact with key market people, prior experience and exchange of ideas) out of the 13 mentioned in theory

Result

• The gap: we do not know which relational activities at the micro level get routinized and become significant to build relational capabilities

– Routines have been difficult to measure since we did not have analytical tools to find complicated combinations between activities

• The question: which relational activities become routinized into relational capabilities

• Finding: three out of the six relational components (realization, access to opportunity and assessment capability, whilst the co-adaptation component was borderline) were routinized by four significantly repeatable activities(alignment of interests, contact with key market people, prior experience and exchange of ideas) out of the 13 mentioned in theory

Conclusion

• In contrast to prior studies, projects do not need long-term learning and trust to develop relational routines into capabilities, but instead

these four activities were systematically planned within an expedient turnaround of problem solving cycles, where they exchange ideas, exploit market relations, adapt processes and co-design approaching tasks as problems

• If you have a large project with a diverse stakeholders you would benefit from planning problem solving cycles where people focus on tasks as problems and use alignment of interests, contact with key market people, prior experience and exchange of ideas to exploit their interaction

Conclusion

Appendix

Thank you

Any questions

Definitions of relational components and activities Capability

component

Explanation of capability

component

CODES of

activities

Explanation of routine activities

Realisation

Capability

The ability to map out and realise

business-to-business networks that

could enhance marketing

MARKET Interaction with key contacts in markets for funds,

resources and marketing

SHAPE Interaction with owners, decision makers and

politicians to influence regulation

Assessmen

t

Capability

The ability to proactively manage

networks to allocate time based on

usefulness; strengthen worthwhile

bonds; realise the benefit of weak

ties; and expand their networks

Hierarchical, epistemic and

communities of practice

PRIOREXP The selection of partners on the basis of past

experience

Alliance function manuals, personnel and assets

ALIGN Alignment of goals and interests between partners

DISPUTE Activities for dispute resolution, arbitration or

renegotiations

INV The level of investment- resource or otherwise – to

make it work

Access to

knowledge

The ability to generate, integrate and

utilise knowledge from network flows

emerges as a distinctive marketing

oriented relational capability

KNOWLEDGES

HARE

The level of sharing of information and knowledge

between partners – Interfirm knowledge-sharing

routines

KNOWLEDGE

OVERLAP

The levels where people exploit the overlap of skills and

knowledge

Open learning and knowledge transfer

Access to

opportunit

y

The ability to extract and exploit

opportunities in a network

IDEAS Improve the exchange process

Co-

Adaptation

The ability to proactively adapt

products and services through

interaction

ADJUST Mutual adjustment – Change habits and develop skills

to fit the situation task and relation

DESIGN Adapt and change according to customer requirements

Co-

Innovation

The ability to tap into the pools of

technologies and human resources in

order to jointly innovate

COSPECIALIZ

E

Embeddedness of partners’ specialization – mutual

learning

COMPLEMENT The extent to which partners use their skills in a

complementary fashion