Sustainable Development and Value Creation, an Approach from the Perspective of Project Management

Abstract

The discipline of project management has been maturing over time, integrating positively with some organizational approaches, such as strategy and sustainable development, to meet current needs without risking future capabilities. In this sense, it is observed that measuring the success of a project only from the classic mechanistic perspective of the triple constraint: scope, time, and budget, is insufficient; this opens a space for a new variable of social progress: the creation of value. Thus, the objective of this study is to identify the degree of relationship between the success of the projects and the sustainable development approach, managing to determine through the results obtained some opportunities for improvement in light of the economic and organizational context. As a starting point for this research, a review of the literature associated with topics, such as sustainable development, value creation, and modern trends in project management, was carried out. The second step was to design and apply a structured survey to 148 Colombian companies that develop projects in different sectors, such as technology, infrastructure, and services. With the information collected, a structural equation modeling—SEM model was applied to determine the relationship between the selected variables. Finally, the results of this research showed that the success of a project that is carried out under a sustainable development approach has a positive tendency toward the creation of value. In conclusion, it is found that the four dimensions studied: impact, relevance, effectiveness, and efficiency, allow us to explain to a greater or lesser extent the success of the projects through their approach to sustainable development and value creation.

1. Introduction

The economic development of countries shows many challenges and questions concerning the care of common resources, such as water, land, air, and biodiversity. Undoubtedly, industrial and technological developments are fundamental pieces for strengthening the competitiveness of countries however, this has generated enormous environmental and social impacts that lead us to reflect on the future of humanity [1]. The search for efficiency in any initiative cannot be separated from the impact that the expected results may generate on the environment; on the contrary, the new management dynamics warn about the need to undertake efforts with purpose, always thinking about the consequences throughout the life cycle of the projects: before, during, and after [2].

Following the above, every project undertaken should have as its main objective the creation of value for the stakeholders. With this idea in mind, efforts should be focused on meeting the needs of the communities involved, creating the greatest possible value, without negatively or disproportionately affecting the environment [3]. Therefore, the expected economic development would have to be achieved without putting the future of the next generations at risk; in short, sustainable development must be achieved that meets current needs without compromising future capabilities.

Under this association of ideas and concepts, we see how projects with a sustainable approach allow the creation of value, which, ultimately, is the main indicator of success that should matter [4]. This makes us think about the importance of integrating good project management practices with modern organizational management trends, such as strategic thinking, competitive approach, change management, knowledge management, and governance [5]. This integration tests the adaptability of the project manager, challenging him to leave behind the traditional approach of mechanistic management and to become a leader and strategist with the ability to deliver efficient solutions in a complex environment, through the leadership of high-performance work teams.

Sustainable development must be understood as the organizing principle of value generation that allows aligning the necessary elements, under the project approach, to achieve the expected results in the social, economic, and environmental framework [6]. This reflection is perhaps one of the most important conclusions drawn from this study because it allows linking the different management approaches in search of the common good. In this sense, the generation of value from the projects undertaken can be interpreted as synonymous with equality, well-being, social growth, and respect for common resources and differences [7]. This makes management efforts more complex, proposing new challenges to achieve project success. Shortly, it will not be enough to achieve efficiency in the results, and it will also be necessary to work for the quality of life and the preservation of humanity [8].

Based on the ideas exposed up to this point, the objective of this study has been defined as the identification of the degree of incidence exerted by the new trends in project management on the sustainable development approach for the creation of value, seeking to determine through the results obtained some challenges and opportunities in light of the current organizational context. To achieve this, a theoretical review of the main authors on issues related to sustainable development, value generation, and new trends in project management has been carried out, obtaining as a result the research hypotheses and the conceptual model. Subsequently, a structural equation model was applied to the data collected from a sample of 148 Colombian companies and in this way to reach the conclusions of this study.

2. Theoretical Framework

This section focuses on developing two key perspectives: sustainable development to create value and new trends for project management. The literature analyzed is presented below.

2.1. Sustainable Development and Value Creation

Over time, the sustainable approach has been integrated with the project management framework [9], and this has tested the capacity of projects as drivers of sustainable development, linking them directly with social aspects, environmental and economic, evaluating success through the impact caused and the value created from the results that are delivered to the different stakeholders involved [10,11,12,13]. In this way, an important trend is observed toward the integration of sustainability with projects as a key strategy for economic growth that reduces the impact on future resources [14]. In short, both concepts complement each other directly, the challenge is to find a way to operationalize them in real situations so that they work in an integrated and mutually beneficial way [15].

Therefore, it can be argued that the environment of the project determines the limitations, and the generation of value must strategically build, maintain, and improve collective conditions through the achievement of results, identifying the benefit, its usefulness, or importance, as well as how each actor contributes to the achievement of the set of objectives [16]. In this way, value can be defined as the products or services derived from the projects undertaken, which are perceived as desirable by the potential beneficiaries [17], which are perceived as desirable by the potential beneficiaries. Consequently, the value is not created through individual efforts, but, on the contrary, it is the joint actions that become relevant, in addition to taking time and depending on multiple exogenous variables for their execution [18]. A project will create value if the planning and execution stages are connected with a later phase of adoption of results by the main interest groups. This allows the concept of sustainable development to be integrated. Based on this premise, a project cannot be concluded without first ensuring that its results are convenient for the stakeholders involved and also generate the expected benefits [19].

Thus, the success of a project will depend on the integration of different dimensions [20], not only those described by the triple restriction: scope, time, and cost, but also the social and environmental perspectives that will respond to the expectations of the stakeholders [21]. In this way, the creation of value can be ensured from the joint effort made throughout the projects [22]. This idea leads us to rethink the role played by the classic project manager, removing him from his role as a controlling entity and leading him to intentionally adopt a holistic approach that allows him to understand the quality of the project through a sustainable development approach [23]. Consequently, from this analysis, we can conclude that the quality of the project is linked to its ability to generate value [24], and the concept of quality is related to the expectations that are held about the results. This highlights the importance of the correct management of the stakeholders, positively insisting on the creation of the present and future value.

Based on the foregoing, it is observed that the transition toward the adoption of good sustainable development practices requires a substantial change in the way in which products, services, and processes are designed and created, as well as in the way in which resources are managed. The projects must be interpreted as entities of change and achievement of results, based on their planning, organization, execution, and management [25].

2.2. Modern Trends on Project Management

Due to its character of efficiency and effectiveness, the project management and leadership discipline has been positioning itself in the organizational field, providing managers with different alternatives to achieve concrete results in light of the corporate strategy [26]. However, the development of research dedicated to identifying the factors of project success or failure is not enough, and the existing studies focus on documenting lessons learned from projects implemented [27]. The relevance of the research in this topic lies on the need to generate references that facilitate the quality assurance of projects and their results, thus ensuring the generation of value with greater social impact, under the expectations of the stakeholders involved.

In their study, Padalkar and Gopinath [28] show an account of emerging trends in project management. According to the authors, topics, such as organizational strategy, corporate flexibility, governance, control, stakeholders, change management, project teams, and knowledge management, are some of the topics addressed in recently published research. Likewise, one can recognize a consistent pattern that defines the success of a project in terms of its capacity to generate value from results. Surco-Guillen et al. [29] supplement this position by proposing four dimensions that affect project success: effectiveness, efficiency, relevance, and impact. The first two respond to the intention of the project and the correct management of resources, while the last two question respond to the importance of the project for the organization and how it benefits from the results.

Regarding organizational strategy, Cezarino et al. [30] state that the objective of a project is to strengthen the competitive advantages of companies within the framework of the strategic direction declared under a sustainability approach. Depending on the strategic framework, the most relevant projects for the organization must be selected based on the value that each stakeholder group intends to receive. Therefore, the strategy materializes from the projects, and since the resources are finite, the projects that provide the greatest value must be properly selected [31]. Viewed from this perspective and given that the burden of strategy execution falls on the organizational structure, flexibility makes sense. Rigid or complex organizational structures unable to adapt to changes in the environment make it difficult to execute projects and generate competitive advantages for companies. Without a doubt, the execution of the strategy is directly proportional to the degree of flexibility of the organizational structure, so both must be properly aligned to ensure the correct execution of the projects to be carried out [32]. In this way, it can be inferred that the relevance of the project is defined in light of the organizational strategy and its approach to competition.

In this sense, organizational change management models have been incorporated into the project management discipline, under the guiding principle that every project is planned to generate a change in the different stakeholders through results [33]. In the same way that change is managed on the variable that defines the scope of the project, it is necessary to prepare the organization to face the changes brought about by the results obtained; otherwise, the success of the project is put at risk because it would not be possible to generate the expected value in the stakeholders [34]. A project will succeed in generating organizational impact to the extent that its results are transferred and appropriate; otherwise, it will be a wasted effort with no major impact on the contracting corporations [35]. Therefore, the impact of the project will depend on the level of knowledge of the expectations of the stakeholders and how the change that brings about the results is managed.

In the case of project teams, there is a positive relationship between knowledge management and the level of performance its members achieve [36]. Thus, strengthening the key competencies of project teams, through an articulated knowledge management model, will allow the successful delivery of the project, besides overcoming, with greater efficiency, the obstacles that arise throughout the life cycle, thus improving the expected performance [37]. Therefore, attention to knowledge management schemes within the framework of projects will facilitate the development of key capabilities of the teams, under a systemic perspective of meaningful learning through previously learned lessons, thus improving the efficiency rate in the management and quality of projects, ensuring the value delivered to organizations [38]. Thus, the effectiveness of the project will be defined by the performance of the project teams and the appropriate knowledge management processes that are adopted.

Under this idea, when reviewing the concept of governance, we find that it traditionally associates with aspects of direction, control, or accountability; in other words, it is the organizational framework in which project decisions are made [39]. In this sense, Derakhshan et al. [40] state that, in the project context, governance is defined as a multidimensional phenomenon described by the expectations of the different stakeholders. In the same way, Muller et al. [41] argue, considering agency theory, that governance defines the mechanisms of interaction between the project manager and stakeholders, influencing their participation and determining their trust. Therefore, governance deals with the alignment of the project with the organization’s strategy, providing tools to prioritize the allocation and management of resources efficiently, seeking the greatest delivery of value [42]. Then, the efficiency of projects can be defined through governance and the correct management of resources.

Figure 1 presents the conceptual model that summarizes the interaction between the five dimensions identified with their respective variables. Based on the theoretical framework, we have identified five dimensions: relevance, impact, effectiveness, efficiency, and sustainable project. In turn, each of these dimensions is represented by two variables as follows: relevance is described by the strategy and competitive approach, stakeholder impact and change management, effectiveness through project teams, and knowledge management and efficiency through governance and resource management; and finally, sustainable project is related with value creation and social development.

By contrast,

Table 1. Relationship between dimension, variables, and connection issues.

Dimension	Variables	Connection Issues
Sustainable development	Project success	- Triple constraint - Social impact - Post-project environment - Desire to create value
	Value creation
Relevance	Strategy	- Scope of the project - Sponsors expectations - Prospective about the results
	Competitive focus
Impact	Stakeholders	- Stakeholder expectations - Relevance of results - Project lifecycle
	Change management
Effectiveness	Work teams	- Market share - Risk management - Quality control
	Knowledge management
Efficiency	Governance	- Resource management - Control mechanisms - Time and cost constraints
	Resource management

Source: Prepared by the authors.

presents the dimensions and variables identified, in addition to connection issues on which the questions were formulated in the survey.

3. Materials and Methods

The analysis in this research was based on a questionnaire containing 18 questions to capture the variables observed and then distribute them into two groups. The first group intended to characterize the organization that answered the questionnaire; in this case, the time of permanence in the market, the type of legal organization, the subsector in which it was registered, the range of income received in the previous year, the size of the project teams, the types of projects developed in the organization, and the control mechanism used in the management of projects. In the second group, the questions aimed at rating the performance of the organization on a scale of 1 to 10 in variables related to project success, value creation, strategy, competitive focus, stakeholders, change management, work teams, knowledge management, governance, and resource management (See Table 1).

The questionnaire mentioned was filled out by the project manager from each company included in the sample. The questionnaire was validated through Cronbach’s Alpha, achieving a result of 0.919; therefore, these results are considered reliable, given that the homogeneity of the items was greater than 0.70 [43].

The aforementioned questionnaire was sent to a sample of project managers from 148 organizations registered with the Superintendencia de Sociedades de la República de Colombia [Super intendency of Corporations of the Republic of Colombia] that declared in a survey by the Chamber of Commerce to have a project-based operation. The sample design was based on a maximum permissible error of 6% with a confidence level of 90% from a population of 561 companies, according to the Chamber of Commerce records mentioned before.

Based on the data mentioned above, a model has been developed to test the research hypothesis:

H1: 

The success of the projects is positively associated with the sustainable development approach.

The sustainable development approach is based on the dimensions established in Figure 1: effectiveness, efficiency, impact, and relevance in project management.

For this purpose, structural equation modeling—SEM is used, in which observed variables were started, for which their contributions were established in the calculation of the dimensions, and later, in which the relationship between said dimensions was analyzed and the adjustment of the model was analyzed. Later, we developed a principal components analysis (PCA), a technique that allows the conformation of compound factors that correspond to linear combinations of the existing variables to obtain a better interpretation of the phenomenon under study. Based on the main factors of the PCA, we established a segmentation of the organizations using clustering analysis according to the performance in their projects, and finally, a classification tree pruning process to find the optimal model to evaluate the relations and hierarchy of the variables that intervene in the performance of the projects.

Finally, the research hypothesis that guides this work is presented below.

4. Results

The first part presents the results of the use of SEM in the determination of the sustainable development variable. The information is presented with standardized coefficients to determine the contributions of the variables observed in the determination of the dimensions of the model. The initial structure of the model is presented in Figure 2. In the case of the observed variable of success in projects, significant contributions to the dimension of sustainable development were established; their standardized coefficients are 0.72 and 0.81, respectively, which can be considered significant. Regarding the effectiveness dimension, initially, the observed variables of market share, compliance with risk restrictions, and compliance with quality restrictions were considered. The model showed that only the variables compliant with risk restrictions and project quality contribute significantly with the coefficients of 0.74 and 0.73, respectively. This is an important finding since these two independent variables are associated with the dependent variable knowledge management, explaining their relationship through these significant coefficients.

In the case of the efficiency dimension, the observed variables related to the project control mechanisms, time constraints, cost, and resources were considered. The coefficients made it possible to establish a significant contribution of the variable compliance with time, cost, and resource restrictions in determining the said dimension, with coefficients that exceed 0.54. Regarding the dimension impact, we start from the variables related to stakeholder expectations, relevance of results, and the project life cycle. In this regard it was possible to establish a significant contribution of the variables related to stakeholder expectations and the relevance of results; their coefficients were 0.77 and 0.86, respectively. For the relevance dimension, the observed variables of the scope of the project and sponsors’ expectations presented standardized coefficients of 0.58 and 0.65, respectively. Once the observed variables that did not have significant contributions were removed from the model, the new version was obtained (See Figure 3).

Considering the results of Figure 3, it was possible to establish that the dimensions that most influence the sustainable development of projects are those of efficiency and impact, with the impact being the coefficient with the greatest magnitude of 0.8, while efficiency contributes by 0.2. The results showed that sustainable development in the projects is closely related to the effectiveness and fulfillment of the expectations of the interested parties, which are the variables observed that are linked to the impact dimension.

For the model presented in Figure 3, the fit measures were determined considering its latent variables (dimensions), for which the p-value was determined, assuming the null hypothesis as the non-fit of the model. Starting from the above and given that the p-value is less than 0.05, it is possible to reject the null hypothesis and establish the fit of the model (See Figure 4).

To establish the goodness of fit, the indices presented in

Table 2. Model fit indices.

Model	RMSEA	SRMR	GFI	AGFI	NFI	CFI
SEM	0.057	0.075	0.878	0.823	0.831	0.960

Source: Prepared by the authors.

were used, in which it is highlighted that the GFI (0.878), AGFI (0.823), and NFI (0.831) indices, despite being lower than the cutoff point (0.96), take values close to 1 indicating an appropriate fit of the model. As for the CFI index, it presents a value of 0.960, which can be a good fit in the model. Regarding the root mean square error of approximation (RMSEA) with a value of 0.057, it is less than 0.06, confirming the good fit of the model. In the measure of the mean square of the standardized residuals (SRMR), it satisfies the condition required to consider a good fit since it takes a value of 0.075, lower than the cutoff point of 0.09. In this case, it is important to consider that since alternative models were not analyzed (a model was developed that was improved according to the fit), then it is irrelevant to present parsimony indices.

The second part of the results presents the principal component analysis that identifies two important groups of variables in two dimensions: the first one (Dim 1) with a representativeness of 57.52% and the second one (Dim 2) with 10.24%. Dim 1 includes variables related to effectiveness, efficiency, compliance with the expectations of stakeholders, cost reduction or income generation in the organization, and compliance with quality constraints in projects. As for Dim 2, there is a group of variables around compliance with project constraints, such as time, resources, scope, risks, and costs (Figure 5).

From the principal components analysis, we also identified the contributions of the variables in each of the dimensions, which in the case of Dim 1 includes the variables of efficiency (11.89), effectiveness (10.89), and compliance with stakeholders’ expectations (10,23). In the case of Dim 2, the variables related to compliance with time constraints (25.59), resources (16.19), and costs (13.46) have an outstanding contribution. Figure 6 presents the contributions in detail.

As part of the principal component analysis, we identified the distribution of results of the variables in the previously identified dimensions. In the case of Dim 1, an asymmetry to the right is observed, indicating better performance results of the organizations in the variables that are part of this dimension. In the case of Dim 2, the organizations’ performances have a more symmetrical distribution, showing results closer to their mean. Figure 7 shows the distributions.

The composition of Dim 1 (project success) corresponding to the largest amount of variance that can be detected in the set of companies can be expressed as a combination of the aforementioned variables (coefficients weighted according to the contribution of each variable) with the following structure:

$$\begin{array}{cc}\mathit{Success}=& 0.0599\ast \mathit{Time\_restrictions}+0.0808\ast \mathit{Cost\_restrictions}+0.0900\\ & \ast \mathit{Scope\_restrictions}+0.0932\ast \mathit{Risk\_restrictions}+0.0798\hfill \\ & \ast \mathit{Resources\_restrictions}+0.0840\ast \mathit{Quality\_restrictions}\hfill \\ & +0.1023\ast \mathit{Expectations\_of\_the\_stakeholders}+0.07097\hfill \\ & \ast \mathit{Decrease\_in\_costs\_in\_the\_organization}+0.1189\ast \mathit{Efficient}\hfill \\ & +0.1089\ast \mathit{Effective}+0.1106\ast \mathit{Successful}\hfill \end{array}$$

The construction of this factor makes it possible not only to measure the level of success in the companies analyzed but also to provide other organizations with a point of comparison of this level concerning the behavior observed. Similarly, it is possible to obtain a segmentation to define the level of success of the project.

According to the aforementioned performances, we analyzed the classification of the organizations according to the high, medium, and low levels of cluster performance. The cluster with high performance has an average score of 8.89 and includes 72 organizations. As for medium performance, it has an average score of 7.23 and concentrates on 57 organizations. Finally, the cluster grouping of the 19 organizations with low performance obtained an average score of 4.49 (Figure 8).

Finally, a classification tree with a pruning process was used to establish the organization of the relationships within each cluster. For the cluster related to the best-performing organizations, the most relevant variables were identified, including the type of projects developed, the type of legal organization, the size of the project teams, and the level of income in the previous year. As for the determining variables of organizations that do not perform well in projects, we observed an important intervention of the project control mechanisms, the size of the project teams, and the operation time of the project, together with its organization in the market. Figure 9 presents the results.

5. Discussion

Based on the results obtained, there is a clear tendency to measure the success of projects based on the creation of value through their results. This approach coincides with what was proposed by Niknazar and Bourgault [44], who mentioned that the value generated by a project will depend on its purpose. Under this idea, the PMI [16] defines projects as components of a value delivery system focused on building, maintaining, or improving an organization. The value is perceived as a gain that arose from the perception of each one of the stakeholders involved. This reflection is valuable for modern project managers, who should be trained as organizational strategists capable of solving problems through the application of project management tools, strongly focusing on value generation. As mentioned by Bolzan de Rezende et al. [45], competent project managers are those capable of understanding the reality of the organization, its purpose, and strategy and, based on these referents, manage resources efficiently to generate the greatest possible added value.

Under this same logic, Padalkar and Gopinath [28] mention that project management has ceased to be a good practice exclusive to engineering areas to become a transversal discipline that involves positions, reasoning, and theories of management and the humanities, which has strengthened it and given it prominence in the organizational framework, and it is perceived as a determining factor in the achievement of results. According to Druker [46], a holistic vision allows a better understanding of the environment and its needs, while facilitating problem-solving through interdisciplinary work, being the manager's responsibility to know when to change course with a committed spirit. This investigation coincides with the ideas proposed by these authors.

However, it is also important to ask how prepared companies are to face new changes in the environment through the incorporation of new knowledge and the development of new capabilities. Reflecting on this subject leads us to think about the speed with which absorbing new knowledge can provide a competitive advantage, innovation being one of the variables with the greatest impact on the evolution of human thinking [47]. According to Garzón [48], capabilities live in people and will be covered in processes; in this sense, project teams become relevant as drivers of organizational development. Capabilities, such as absorption, innovation, adaptation, and learning, are key under the premise of value generation. As Kerzner [49] states, the company's strategy becomes a reality through projects. Under this idea, it is not strange to think that the project manager must develop new and better capabilities that can become a strategic ally for the consolidation of the vision of companies.

Finally, under the current state of uncertainty, it is clear that predicting the outcome of a project is a complex task; however, the correct understanding of environmental signals will allow project managers to improve their probability of success, under a sustainable approach [50]. As Carvalho [51] mentions, it can be stated that there is no absolute behavior attributable to an organization, and therefore, management styles will depend on the variability of its environment. In the light of contingency theory, it can be stated that there is no absolute behavior attributable to an organization, and therefore, management styles will depend on the variability of its environment. However, the organization must adopt a management scheme that allows it to secure resources and react effectively to changes in the context. This is perhaps the most appropriate way to anticipate problems and protect value generation. The key to successful management is to guarantee the stability of companies by properly managing innovation, without affecting the organization [52]. As authors, we are convinced that a project will be sustainable if it generates value for its stakeholders, in addition to promoting social impact through its results. In this sense, to achieve this, the project manager must ensure the efficiency and effectiveness of the project through effective management.

6. Conclusions

The main conclusion of this study is the validation of the proposed hypothesis. In this sense, we see how based on the results obtained, there is evidence of a positive association between the success of the projects and sustainable development, explained through the scope of effectiveness and the fulfillment of the expectations of the stakeholders. Thus, the null hypothesis is rejected, and the alternate hypothesis is accepted. These results allow us to validate the achievement of the objective proposed for this study.

Regarding the proposed conceptual model, we see how the four selected dimensions: impact, relevance, effectiveness, and efficiency, allow explaining to a greater or lesser extent the sustainable approach of the projects and, derived from this, the success of the projects through the achievement of results with high impact and generation of value, concluding that the most representative is the management of the expectations of the stakeholders, the focus on results, the clear determination of the scope, risk management, quality management, time management, and budget management.

Another conclusion of this research refers to the two dimensions recognized in the principal component analysis (PCA). Dim 2 clearly shows the tendency of a significant number of organizations to concentrate their efforts on having an outstanding performance in meeting constraints, such as scope, time, and budget, which does not necessarily imply that a project is going to be successful. By contrast, Dim1 concentrates several organizations seeking to generate organizational value through effectiveness, efficiency, cost reduction, revenue generation, and compliance with stakeholder expectations. Considering current trends, these are the variables that most accurately describe the success of the project. In short, a successful project must always be sustainable and have a high-value creation.

In addition, a growing trend is observed in the sample of selected companies for sustainable projects focused on generating organizational value to be more successful than those focused on the development of the task. This finding is significant because it allows us to break the focus of mechanistic control and places project management on a transversal plane made up of three dimensions: organizational, human, and engineering.

Finally, it is important to highlight the strength of the multivariate methods. With its application, we were able to create a composite indicator that measures the sustainability of the projects based on the variables analyzed, allowing us to group the results through segmentation methods, and establishing a classification scale of companies, generating not only a direct diagnosis of their current state but also opportunities for improvement in different aspects. In addition, the use of characterization variables helps to measure the propensity for sustainability through variables that directly discriminate its behavior. This is useful since it allows visualizing the current situation of the companies to generate opportunities for improvement.