Uncertainty and Project Management: Beyond the Critical Path Mentality

UNCERTAINTY AND PROJECT MANAGEMENT: BEYOND THE CRITICAL PATH MENTALITY

Arnoud De Meyer1), Christoph H. Loch2), Michael T. Pich3)

1) Professor of Technology Management, INSEAD ([e-mail])
2) Associate Professor of Technology Management, INSEAD ([e-mail])
3) Assistant Professor of Technology Management, INSEAD ([e-mail])

Keywords: project management, uncertainty, project profiles

Abstract

Project management is often identified with network planning techniques such as PERT, Critical Path Methods, Gantt Charts, etc. These techniques help us to cope with the management of complexity in a project. But projects are often confronted with a high level of uncertainty. Coping with this uncertainty requires another management approach. In this paper we categorize the different types of uncertainty with which a project manager can be confronted and we develop a list of tools and managerial approaches that can help the project manager to respond to the different types of uncertainty.

1. INTRODUCTION

In executing operational activities, organizations often find it useful to make a distinction between processes, the systematic execution of repetitive activities, and projects, the one-time execution of more or less unique activities. In today’s new ‘new’ economy, the second form of operations is gaining in importance as more and more activities are carried out as projects. One can find many reasons for this shift of emphasis. The fast pace of competition requires constant innovation. Better-informed customers require customization. Internationalization and constant mergers and acquisition require more agility. In short, the current business environment requires constant change, and implementing change entails the need to master projects.

A project can be defined as a unique set of activities with more or less clearly defined objectives, carried out within a limited budget and

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