nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2018‒10‒15
ten papers chosen by
Arvi Kuura
Tartu Ülikool

  1. L’écoute des parties prenantes dans une optique de développement durable : continuité ou alternative pour le marketing de projets industriels ? By Fanny Romestant
  2. Evaluating Large Projects when there are Substitutes: Looking for Possible Shortcuts By Per-Olov Johansson; Ginés de Rus
  3. Application of Quantitative Risk Analysis in Property Development Projects in Nigeria: A Review By Obinna Collins Nnamani
  4. Valuation Construction Permit Uncertainties in Real Estate Development Projects with Stochastic Decision Tree Analysis By Serhat Basdogan; Hilde Remøy; Ruud Binnekamp
  5. Allocation of R&D Grants in the Business Sector By Falk, Martin; Svensson, Roger
  6. Collaborative property-based management schemes in urban rehabilitation projects: instruments and possibilities for adaptation in post-socialist societies By Astghik Grigoryan
  7. Possible State Intervention Options to Serve Transition-Age Youths: Lessons from the West Virginia Youth Works Demonstration Project By Joyanne Cobb; David C. Wittenburg; Cara Stepanczuk
  8. The role of enterprise modeling in digital transformation : an exploratory study By Hafsi Mouaad; Saïd Assar
  9. Raising Capital from Heterogeneous Investors By Marina Halac; Ilan Kremer; Eyal Winter
  10. Skill versus Voice in Local Development By Katherine Casey; Rachel Glennerster; Edward Miguel; Maarten Voors

  1. By: Fanny Romestant (Groupe Sup de Co La Rochelle)
    Abstract: This work questions the very purpose of marketing, focused on "customer value" to propose, in line with the work of Deshayes and Lecoeuvre-Soudain (2011) in industrial marketing and projects marketing, the concept of "social value". In the sustainable development mining, this involves to discuss the link between primary stakeholders (client, prime contracting support, companies) and other stakeholders (NGOs, neighborhood, etc.). This research was born through a project with an industrial company in the transport sector, initiating a CSR process. Following an exploratory study focused on the company's clients (depth analysis of tender documents, interviews with key actors of the buying process), and through collaboration with company officials (business developer), it became insufficient to limit our analyses to the cus-tomer's expectations, to understand the issues of a project. The aim of this paper is of theoretical nature. It is about developing an understanding framework to take stakeholders into account in industrial project marketing. This framework suggests that stakeholders can be designed from the perspective of "continuity" or as an "alternative" in project marketing. The objectives of this paper are threefold. Firstly, to put the notion of stakeholders as a specific issue in the business marketing, secondly to propose a new way to understand the concept of stakeholders and finally to show how the stakeholders can change the industrial project. The issue focuses on the construction dynamics of sustainability in industrial projects, seen as a new challenge for business marketing (industrial project marketing).
    Abstract: L'écoute des parties prenantes dans une optique de développement durable : continuité ou alternative pour le marketing de projets industriels ? Cette contribution questionne l'objectif même du marketing centré sur la « valeur client » pour proposer, dans la lignée des travaux de Deshayes et Lecoeuvre-Soudain (2011) en marketing industriel et marketing de projets, la notion de « valeur sociétale ». Dans le cadre du développement durable, cela implique de traiter du lien entre acteurs primaires (client, maîtrise d'oeuvre, entreprises) et les autres parties prenantes (ONG, riverains, etc.). Cette recherche est née d'un projet avec une entreprise du secteur industriel des transports, initiant une démarche de développement durable. À travers une étude centrée sur les clients de l'entreprise (analyse d'appels d'offres, entretiens avec des acteurs clés du processus d'achat), il est apparu insuffisant de se limiter à leurs attentes exprimées pour comprendre les enjeux d'un projet. L'enjeu de cet article est de nature théorique ; il s'agit de proposer une grille de lecture des différentes perspectives pour la prise en compte des parties prenantes en marketing de projets industriels. Cette grille de lecture suggère que les parties prenantes peuvent être conçues dans une perspective de «continuité» ou comme une « alternative » aux méthodes en marketing de projets. Les objectifs de notre article sont d'une part de poser la notion de parties prenantes comme un enjeu spécifique du marketing d'af-faires, d'autre part de proposer une nouvelle manière de lire la notion de parties prenantes et enfin de montrer en quoi les parties prenantes changent le projet industriel. La problématique porte sur la dynamique de construction du développement durable dans les projets industriels appréhendée comme un nouvel enjeu pour le marketing d'affaires (marketing de projets industriels).
    Keywords: stakeholders,industrial project marketing,CSR,Parties prenantes,marketing,RSE
    Date: 2017
  2. By: Per-Olov Johansson; Ginés de Rus
    Abstract: This paper discusses how to evaluate a large project when there is a substitute. The new large project causes discrete price adjustments in the substitute market. For example, a new high-speed rail may shift the demand curve for flight tickets to the left and reduce their price, in turn shifting the demand curve for train tickets to the left. There are several different ways to handle this complication, and we hopefully provide some guidance how to proceed. In particular, we point at an approach that captures the general equilibrium effects of a considered project in its output market. In theory at least, this approach provides a simple shortcut in cost–benefit analysis of (infrastructure and other) projects that are so large that they have a noticeable impact on equilibrium prices in other markets. A similar shortcut for transport projects that affect time costs is also supplied.
    Date: 2018–10
  3. By: Obinna Collins Nnamani
    Abstract: Property development is a multifaceted, dynamic and risky enterprise. Property development projects are fraught with risks and uncertainties spanning through the stages of the development process. Risk and uncertainty, if not well managed, could have harmful impacts on development project by affecting time, quality, and cost of such project. In Nigeria, evidences abound of property development failures and abandonments with the attendant social, environmental and economic consequences. Development projects are abandoned before completion or completed projects are not disposed over six months. In other cases, completed projects are foreclosed by development lenders due to inability of the developers to service their loans. These problems could be attributed to development companies not employing formal strategic risk management in project evaluation. The aim of this paper is to review literature and previous research on application of risk management techniques in property development industry with a view to identify the possibility for further research in Nigeria. The review used various sources such as textbooks, journal articles, reports, masters’ dissertations and doctoral theses relevant to the study. The review showed that, generally, risk management is still largely handled in a subjective manner. Any notion that developers are now applying a wide range of rigourous and sophisticated risk management techniques is erroneous as this is scarcely manifested in actual practice. In the Nigerian context, there is probably no research on risk management by development companies; few risk management studies were limited to risk analysis/assessment; while others focused on building construction risk which is just one of the stages in the property development process. This paper recommends the development of an advanced risk management framework applicable to the Nigerian property development industry.
    Keywords: Property Development; Review; Risk; Risk Management; Uncertainty
    JEL: R3
    Date: 2018–01–01
  4. By: Serhat Basdogan; Hilde Remøy; Ruud Binnekamp
    Abstract: With the rapid development of real estate markets under globalization and exponential competitive market conditions, risk evaluation has been one of the most important tasks in the process of real estate investment valuation. This paper describes the relationship between construction permit uncertainties and real estate development projects by using the Decision Tree Analysis (DTA) approach together with Monte Carlo simulations. Expected Value (EV) criterion for an office development project proposed and incorporated into conventional Discounted Cash Flow (DCF) analysis which is determined by stochastic DTA. This will help utility function to come closer to the real world, so that decision making and risk analysis can be done based on the real and possible data providing better conditions for investors. The results are consistent with the results calculated by conventional DCF analysis. However research demonstrates that is of application Monte Carlo Simulation (MCS) and DTA obviate the deficiencies of conventional DCF analysis under construction permit delays and scheduling uncertainties. Results also emphasize the importance of applying EV and DTA for the construction permit delays generate a significant change in NPV and also investment decisions of real estate development projects.
    Keywords: Decision Tree Analysis; Expected Value; Monte Carlo Simulation; Real Estate Development; Valuation
    JEL: R3
    Date: 2018–01–01
  5. By: Falk, Martin (Austrian Institute of Economic Research (WIFO)); Svensson, Roger (Research Institute of Industrial Economics (IFN))
    Abstract: The aim of this paper is to provide new empirical evidence on the most crucial determinants of success for firms applying for public R&D grants. Previous studies have been limited to firm level data and mainly tested how firm characteristics affect the allocation of R&D grants. Thereby, they cannot differentiate between firms that have applied for grants but been rejected and firms that did not apply at all. Our contribution is that we use a detailed database of accepted and rejected R&D applications and also introduce several measures of quality indicators of R&D project applications. The estimates show that R&D projects that are assessed with good or very good ratings are significantly more likely to receive approval; particularly for innovative content and novelty as well as to expected additional impacts on R&D activities. In contrast to previous studies, most firm-level characteristics (R&D intensity, labor productivity, cash flow, industry affiliation) are not relevant, indicating that the R&D funding agency does not discriminate among different types of firms. Consequently, applicant firms should focus on radical, new and innovative ideas in their applications rather than on minor improvements.
    Keywords: Government R&D-funding; Business sector; Evaluation criteria
    JEL: H25 O32 O38
    Date: 2018–09–14
  6. By: Astghik Grigoryan
    Abstract: It is difficult to avoid the impact of economic restructuring on the landscape and social and economic life of many cities which were used to grow within certain economic structure and also supported by the state (Healey, 1997). In many post-socialist countries the collapse of the socialist system was followed by a number of economic, social and legal reforms, due to which the land and property ownership in most of the countries has been transferred from public to private sector. However, in most cases the state transferred to private hands not only the ownership to the property but also the problems related to the quality of that property. The issue has a specific importance with regard to multi-unit housing since the latter occupies the largest share of urban fabric worldwide.While having scarce public resources the promotion of private property-based investment projects becomes a sound solution in qualifying urban residential spaces and overcoming urban decay. Such projects will be successful if applying collaborative approaches and enhancing the value added by the project.The aim of this study is to discuss the possibilities and constraints for application of certain models of collaborative approach to property-based urban management in post-socialist planning practice. Armenia (Yerevan) shall be considered as a particular case of post-socialist transitional society. The discussion shall be based on surveys conducted within the scope of research project.The results show that even in societies where the private property rights and respective regulations are relatively recent the collaboration in urban regeneration projects is more successful when the allocation of the global project value added to each participant is evidenced and rationalized, whereas supportive institutional framework and participation of financial institution as a project stakeholder are considered essential preconditions.
    Keywords: collaborative management; post-socialist society; property-based investment project; Urban Space Quality
    JEL: R3
    Date: 2018–01–01
  7. By: Joyanne Cobb; David C. Wittenburg; Cara Stepanczuk
    Abstract: This article examines Youth Works implementation and outcomes to provide a potential case study for other states interested in expanding services to youths with disabilities.
    Keywords: state intervention, transition-age youth, West Virginia Youth Works
    JEL: I J
  8. By: Hafsi Mouaad (DSI - Département Systèmes d'Information - TEM - Télécom Ecole de Management - Institut Mines-Télécom [Paris] - IMT-BS - Institut Mines-Télécom Business School); Saïd Assar (DSI - Département Systèmes d'Information - TEM - Télécom Ecole de Management - Institut Mines-Télécom [Paris] - IMT-BS - Institut Mines-Télécom Business School, LITEM - Laboratoire en Innovation, Technologies, Economie et Management - UEVE - Université d'Évry-Val-d'Essonne - IMT-BS - Institut Mines-Télécom Business School)
    Abstract: Digital transformation (DT) is a challenging issue for all companies and organizations whatever different is their business environments. DT is about business process, customer experience and business models; it relies on strong and lasting digital capabilities. Conducting DT projects in companies requires the evolution of existing information systems (IS). As Enterprise Modeling is an essential tool for managing the evolution of IS, we hypothesize that it can play an active role in guiding DT endeavors. The goal of this paper is to investigate this proposal through a case study conducted in a large financial firm. The study shows the essential role Enterprise Modeling plays in identifying the most important and relevant places to make changes in the IS in order to accommodate the ongoing DT in the company.
    Abstract: La transformation numérique est un enjeu incontournable qui se joue dans des environnements très différents et au travers de problématiques extrêmement variées pour les entreprises. En effet le numérique envahit la société et l'économie à un rythme accéléré, les canaux numérique se multiplient et leurs usages montent en puissance auprès des clients finaux, cela amène des bouleversements dans les modèles opérationnels, les modèles économiques avec parfois des impacts très importants sur toute la chaine de valeurs. De ce fait, les besoins d'évolutions partielles du système d'information sont fréquents et la gestion de la transformation numérique doit dorénavant être considérée comme une caractéristique permanente du système d'information. La transformation constante des métiers et des techniques en a complexifié la gestion. Dans cette optique, il est nécessaire de se doter de méthodes et d'outils formels spécifiquement adaptés aux différents métiers de l'entreprise et servant de support à l'ingénierie du système d'information. Dans ce cadre, cet article a pour but d'attirer l'attention sur le rôle de la modélisation d'entreprise (EM) en tant que support des prises de décision. L'objectif n'est pas de définir une méthodologie de pilotage de transformation numérique mais bien d'explorer le rôle de l'EM dans la conduite de la transformation numérique.
    Keywords: Digital transformation,Enterprise modeling,IS urbanization,Digital strategy,Enterprise strategy,Transformation numérique,Modélisation d'entreprise,Urbanisme SI,Stratégie numérique,Stratégie d'entreprise
    Date: 2017–05–17
  9. By: Marina Halac; Ilan Kremer; Eyal Winter
    Abstract: A rm raises capital from multiple investors to fund a project. The project succeeds only if the capital raised exceeds a stochastic threshold, and the rm offers payments contingent on success. We study the rm's optimal unique-implementation scheme, namely the scheme that guarantees the rm the maximum payoff. This scheme pays investors differential net returns (per unit of capital) depending on the size of their investments. We show that if the distribution of the investment threshold is log-concave, larger investors receive higher net returns than smaller investors. Moreover, higher dispersion in investor size increases the rm's payoff. Our analysis highlights strategic risk as an important potential driver of inequality.
    Keywords: mechanism design, contracting with externalities, collective action problem, strategic complementarities, unique implementation
    JEL: D86 G24 L24
    Date: 2018
  10. By: Katherine Casey; Rachel Glennerster; Edward Miguel; Maarten Voors
    Abstract: Where the state is weak, traditional authorities often control the local provision of land, justice, and public goods. These authorities are criticized for ruling in an undemocratic and unaccountable fashion, and are typically quite old and poorly educated relative to younger cohorts who have benefited from recent schooling expansions. We experimentally evaluate two solutions to these problems in rural Sierra Leone: an expensive long-term intervention to make local institutions more inclusive; and a low-cost test to rapidly identify skilled technocrats and delegate project management to them. In a real-world competition for local infrastructure grants, we find that technocratic selection dominates both the status quo of chiefly control and the institutional reform intervention, leading to an average gain of one standard deviation unit in competition outcomes. The results uncover a broader failure of traditional autocratic institutions to fully exploit the human capital present in their communities. We compare these findings to the prior beliefs of experts on likely impacts, and discuss implications for competing views on the sustainability of foreign aid.
    JEL: H41 I25 O15
    Date: 2018–09

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