Project Sustainability Management

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Introduction

The purpose of this paper is to carry out an environmental assessment for a new project and identify both the positive and the negative factors that will determine the sustainability of the project.

The environment consists of forces within the organization and others outside the organization which the management has little or no control over. Therefore organization must creatively adapt to both these forces and compete in the circumstances that the environment dictates.

The main environmental factors are corporate, political, social, technical, economic and legal factors. A symbiotic relationship between the project and the environment exists which implies that the output of one is the input of the other and vice versa and this occurs in an almost cyclical pattern. This also means that they depend on each other for survival.

The long term sustainability of each is inextricably linked to the survival of the other. It is for that reason that care must be taken by those planning the project to ensure that the environment is preserved in order to guarantee the continuity of the project.

Because the environment is dynamic the project managers must keep monitoring it during the project life cycle and adjust the organization accordingly.

To achieve long term sustainability of the project a holistic approach during planning is required where all environmental factors are considered and continuous dialogue and engagement of all stakeholders undertaken during the life of the project in order to achieve long term success.

Background of the Study

Each year, millions of dollars are invested in new projects that are later abandoned or whose desired outcomes are not achieved (Khan, 2000). This results in increased indebtedness, unrealized gains from the expenditure or lower rate of gain from the expenditure than expected.

In other instances, projects have to be scaled up or down from original plans at huge additional costs to investors. It is because of this that the field of sustainability management is gaining popularity in management today.

Sustainability is the ability of a project to maintain its “operations and to effectively and economically continue the provision of services and benefits during its life time” (Khan, 2000; USAID, 1988). It is concerned with both the continuity as well as the impact of the project on the environment (Nepal, 1994).

The World Bank defines sustainability as the ability of a project to maintain an acceptable level of benefit flow throughout its economic life (cited in Bamberger and Cheema, 1990).

Sustainability management is concerned with the impact of an enterprise’s activities on the environment because it will in turn affect the long term viability of the firm’s activities (UnitedNations, 1987).

Companies are encouraged to safeguard their long term commercial interests through responsible use of the environment and its resources. This calls for a shift from profit maximization goal to a balance between the economic, ecological and social interests in business (Tshopp, 2003).

The integral components of a sustainable project include; continued operations and maintenance of project facilities, continued flow of benefits to the target groups, continued participation of stakeholders, equitable sharing and distribution of project’s benefits, institutional instability as well as environmental preservation (Khan, 2000; Nepal, 1994; USAID, 1988).

The threats to sustainability can be simple or complex and they vary from sector to sector, they can be internal or caused by the macro environment (Nepal, 1994). They can be identified and rectified at the planning stage or may require constant monitoring of the operating environment and adjustments during the project’s life (Khan, 2000).

The environmental contexts within which a project is to be established and operates in exert significant influence on it and can determine how the project is executed and its level of success (Ferrell and Hartline, 2011).

This paper seeks to identify the environmental forces that will affect and influence the establishment of a new centralized call centre project planned by the Standard Chartered Bank. It is hoped that by doing so the management will be better informed in identify changes in the environment and adapt the project to fit those changes thus, enhancing the sustainability and the chances of overall success of the project.

Proposed Standard Chartered Centralized Call Centre

The call centre will be the office where all the companies in bound calls will be received and outbound calls made. It will consist of customer service, sales as well as technical support staff.

The inbound calls role will be to provide assistance to customers on a 24 hour basis on queries regarding their accounts, information about account balances, assist in loans payments, funds transfers, general customer’s inquiries and resolve any issues that fall within this docket. The outbound calls’ will be used to undertake surveys for the bank as well as in telemarketing of bank’s products.

Previously, the customer care services have been dispersed within the bank and in its branch network. However new advances in call centre technology indicates that a centralized call centre is more efficient and effective.

The advantages of a centralized call centre includes close, constant monitoring and training of staff to enhance quality of service, utilization of advanced technology such as automatic call distribution and automated call response technologies that enhance customers’ experience.

A centralized call centre will also allow the bank to quickly adjust staffing to match volume. It will also be cheaper to operate than a dispersed model which the company has been operating; this is because a major telecommunication setup will be installed once as opposed to small installations in multiple locations as is presently the case.

A centralized and specialized call centre is expected to greatly enhance the Company’s performance and image in the long run as the call centre evolves and becomes more efficient and skilled in assisting customers. It is expected to play a key role in the future as fewer customers are expected to come to banking hall as more banking transactions are carried out through the internet and mobile.

Sustainability Analysis of the Project’s Environmental Context

Sustainability analysis is the rigorous testing before the implementation of a project to identify and plan for any factors that are likely to impact positively or negatively on the sustained delivery of the project. This includes the analysis of the key aspects of the micro and macro environment.

Corporate Environment

This is also called the internal environment and is composed of elements within the organization that determines its ability to achieve its goals (Ferrell and Hartline, 2011).

It includes employees, management, organization culture and management philosophy. The organization’s vision, mission, objectives and policies of the organization are the strongest internal factors shaping the bank’s new project (Berkowitz, Frederick, Roger, Steven, William, 1998).

This is because they define the strategic direction of the organization as they determine which business activities the bank will engage in, the market sectors it operates in and how it achieves these objective and goals. Therefore any new plan or project must be consistent with these factors.

The resources of the organization will determine the size of the project, and its long term success; these resources include financial, entrepreneurial, human resources as well as the infrastructure (Peter and Donnelly, 2006).

The financial endowment of the bank will determine the size of the new project, the level of technology to be acquired, the size and quality of human resources to be recruited amongst others. More importantly, the continued allocation of adequate resources in the future is critical to sustainable operations of the call centre.

The top management of the bank is the most instrumental to the success of this project. These are the people who set forth the goals and objectives of the new project and allocate resources for its implementation. They are important because they define the structure, size and nature of work to be carried out by the new call centre.

The skills and knowledge of the existing employees will play a key role in the design, and implementation of the new call centre. Their resistance to this project could very well derail its success but their support and contribution of skills, knowledge, opinions and ideas will contribute to its success.

The organization culture will determine how effective the new project will be and its long term viability (Peter and Donnelly). Thus, a determined result driven organizational culture is more likely to foster the long term success of the project.

The top management philosophy of work will define how the call centre will work and is likely to have a long term impact on its future (Jain, 2004). Some managers believe that employees like to work so that they can give their employees freedom to do what they want, others on the contrary believe that employees have to be forced to work therefore they institute strict supervisory rules at work. A strict supervisory regime is likely to lead to work dissatisfaction and higher rate of turnover and vice versa.

The organizational structure will determine how the new department fit in, who they report to and their significance and the role they will play in the organization.

It will also define the long term position of the call centre in the organization’s strategy. A prominent position in the structure guarantees sustainability whereas an obscure position may indicate a short term project life.

Political Environment

This relates to the government’s policy on business (Ferrell and Hartline, 2011). It describes the attitude of government to private ownership and business and the level of government participation in business activities. Political environment is also concerned with government assistance provided to businesses such as subsidies, policy and advisory assistance (Ferrell and Hartline, 2011).

It also includes the government stimulation of certain sectors of the economy to promote the production of particular products and the regulation of others through taxes and policy instruments (Berkowitz et al, 1998).

Political stability of a country is very important for business continuity (Hill and Jain, 2005). This is because political instability can destroy the assets of the bank and affect the customers’ ability to buy the banks products and services thus indirectly affecting the banks operations.

The call centre activities will strongly be influenced by government activities because government laws and regulations can make a business’ operations legal or illegal.

Government’s engagement in political or economic federation such as the EU, NAFTA, ASEAN, among others can affect the operations of the bank and the call centre because foreign banks might gain preferential access of the local market and threaten the bank’s profitability and survival (Hill and Jain, 2005).

Finally, government activities also determine exchange rate, nature and intensity of international trade, tax policies amongst others and these may present opportunities or threats to the bank’s long term viability (Peter and Donnelly, 2006).

Economic Environment

This is defined as the “totality of economic factors such as employment, income, inflation, interest rates, productivity and wealth that influence the buying behavior of consumers and firms” (Hartline and Ferrell, 2011). The economic conditions of a country as well as of the world will directly and indirectly affect the operations of the call centre. These aspects of the economy include: –

High level of interests which deter investments because they increase the cost of borrowing and doing business (Jain, 2004).

If the rate of interest is high then the level of funds available to the bank to establish the call centre or maintain its operations will be low; low levels of interest on the other hand stimulate investments.

Taxation laws can foster or hinder business activities (Jain, 2004). Taxation can be general or specific. If taxes on capital investments are low this can foster the call center operations and vice versa. Taxation can also boost or hinder demand of banking services and products thus determining the volume of business that the call centre undertakes (Jain, 2004).

The rate of economic growth is another economic factor that will impact on the call centre activities; when the economy is growing, the level of demand for products and services increases proportionally (Jain, 2004). When the economic growth is weak or negative, the demand for banking services is low. Thus, sustainable economic growth will result in sustained call centre growth.

The level of inflation is another factor that will determine the establishment and its long term success of the call centre. High level of inflation decreases the absolute wealth of citizens (Jain, 2004) and thus reduces the demand for banking service and vice versa.

Other aspects of the economic environment that will affect and determine sustainability include exchange rate trends, unemployment rate and the stock market index. A strong exchange rate favors imports whereas a weak rate favors exports; thus, if the country is a net exporter it is likely to benefit from a low currency whereas if it is an importer it will prefer a strong currency.

A higher rate of employment increases the market size for the bank and a strong market index indicate strong economy and this is likely to increase the demand for the banks product and service in general (Jain, 2004).

Social Environmental

This refers to the changes in social trends as well as the characteristics of the population (Ferrell and Hartline, 2011). The demographic characteristics of the market such as age, gender, education, religion, income distribution, and spatial distribution will influence the nature of activities of the call centre (Ferrell and Hartline, 2011).

For instance, if majority of the population is old, the services provided by the bank will be pension and consumption related; if they are young, the services they will require from the bank will be investment oriented. The level of users’ education will determine the ease with which people can access information from the call centre through their phones or internet.

Religion also plays a very strong role in the beliefs of people, their behaviors and their attitude towards work. There are also taboos and beliefs that may benefit or hinder the demand for the call centre services. For example some Islamic cultures forbid women from working which will impact on the gender of workers as well as reduce the total number of customers.

Usability and revision issues (Technological Environment)

It is concerned with new technologies, products and processes. New technologies such as internet and mobile have brought about new products and services such as real time services and online banking (Kotler and Armstrong, 2006). This has not only opened new frontiers in provision of financial services but also redefined how business is done.

New products such as paperless payments systems, international payments have increased the complexity of doing business. These developments are likely to increase the demand for call centre services as customers are in a position of constantly access banking services, products and information without physically going to the bank.

The need for speed in transaction also favors call centers over physical banking and the general effect of technology on business is that through innovation, there is a host of new improved services and products the result is that the cost is low while the quality has improved significantly.

The challenge of technology is the rapid obsolescence of products and services which shorten the product life cycle drastically meaning the sustainability of the call centre can be rendered useless by new technology.

Ecological Environment

These relate to the climate, weather and the physical environment which broadly define the economic activity that is carried out in an area (Reed, 2006). Changes in the climate such as the global warming phenomena are serious because they threaten to destroy fragile ecosystems as well as economic systems upon which human beings depend on.

It also threatens the world with poverty, hunger and extinction. Another aspect of ecology is pollution management, preservation of flora and fauna as well as cultural heritage. The challenge of the ecology is for companies to get involved in environmental preservation to mitigate the effect of ecological change.

Legal Environment

This refers to the laws that govern the conduct of business in a country (Ferrell and Hartline, 2011); they have a direct impact on the operation of the call centre. They include, anti discrimination laws that forbid the discrimination of persons on the basis of their age, gender, physical ability or disability (Ferrell and Hartline, 2011).

Other important laws include consumer protection laws, ownership laws, banking laws, employment laws, health and safety laws, competition laws amongst others.

All these laws have to be adhered to and they explicitly state what can be done or not. Compliance to these laws impact on the firms operation costs (Reed, 2006).

They can also determine the demand of a company’s product and influence decisions on who gets employed (Kotler and Armstrong, 2010). All the activities of the call centers are actually guided by the laws of the country and must be adhered to.

Conclusion

The environment in which a new project or venture is to be implemented can hinder or facilitate the sustainability of a new project. Thus there is need to fully consider each and every aspect of the environment and the likely effect on the sustainability of the project before implementation.

In order to ensure continuity a long term view of profitability should be adopted as opposed to a short term profit maximization goal (Kotler and Armstrong, 2010).

The most important factor in sustainability management is continuous environmental scanning so that emergent changes are identified and responded to (Ghemawat, 1986). This is because the environmental variable may be favorable today but a change in key variables may make it very untenable for business to prosper in future.

Changes can be abrupt and are not easily predictable (Reed, 2006); companies should therefore identify which factors are critical to their survival and keep a constant eye on them (Cravens and Piercy, 2006).

Companies should also engage in constant dialogue with all stakeholders of a project such as employees, customers, suppliers, investors, government, interest groups and publics because they are part of the environment and also because and any changes and solutions often require their collaboration (Nepal, 1994).

References

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