Ethics Among Risk Takers Leaders in Project Management
Analysis of the Field
Project management is the discipline of planning, organizing, and managing resources to complete a specific project. As stated by, Dalcher (2014), project management is increasingly being recognized as a critical competence in many organizations in both the public and the private sectors. Trends such as downsizing, reduced management layers, greater flexibility, distributed teams, and the challenge of rapidly evolving technology have taken project management beyond its routes in construction, engineering, and aerospace. Project management is often concerned with improving the current condition. It can, therefore, be viewed in terms of a process moving from a problem or an opportunity for improvement toward a solution. In problem-solving parlance, it is assumed that we are seeking to transform from the current problem space to some desired state, which represents the ideal solution (Dalcher. 2014). Leadership in projects guides in direction and gives purpose and meaning to work on the project. Management in projects makes sure that plans are developed, implementation is controlled, and goals are accomplished.
Project management is undoubtedly one of the most important and most used branches of management over the past decades. It is a combination of the art of collecting facilities and doing work by individuals in a formal and unique organization and the science of producing and processing vast amounts of information for project planning and control. One of the first issues of project management is to ensure that the project is defined with specific constraints. The second issues are to optimize the allocation of resources and align the data needed to achieve the project's predetermined goals. Project management is the skills, tools, and management processes required to complete a project successfully.
As stated by Dalcher, 2014, both leadership and management are needed for long-term success. Leadership lights up the flame of motivation, whereas management provides the oxygen for the spark to stay alive. Leadership has been studied theoretically and empirically from multiple perspectives in many research fields. As part of those, researches authors have identified 15 leadership competencies, categorized into three dimensions, as follows:
1. Emotional
a. Self-awareness: The awareness of one’s feelings and the capability to recognize and manage them.
b. Emotional resilience: The ability to perform consistently under pressure in various situations and stay focused on a course of action or need for results when faced with personal challenges or criticism.
c. Intuitiveness: The capacity to arrive at clear decisions and drive their implementation despite incomplete or ambiguous information using rational and emotional or intuitive perception.
d. Sensitivity: The ability to be aware of and take account of the perceptions and needs of others in arriving at decisions and proposing solutions.
e. Influence: The capacity to encourage others to change a viewpoint based on an understanding of their position and recognizing the need to listen to this perspective and provide a rationale for change.
f. Motivation/Conscientiousness: The ability to display a clear commitment to a course of action when faced with a challenge and to match words and needs.
2. Managerial
a. Managing resources: The ability to organize and coordinate resources efficiently and effectively as well as establish clear objectives and convert long-term goals into action plans.
b. Engaging communication: The capability to engage others and win their support through communication tailored for each audience and the ability to be approachable and accessible.
c. Empowering: The capacity to know one's direct report's strengths and weaknesses and encourages them to take on challenges, solve problems and develop their accountability.
d. Developing: The capability to encourage others to take on ever more demanding tasks, roles, and accountabilities, promote others' competencies and invest time and effort in coaching them.
e. Achieving: The ability to show an unwavering determination to achieve objectives and implement decisions.
3. Intellectual
a. Critical analysis and judgment: The ability to gather relevant information from a wide range of sources, sound judgments, and decision-making, and awareness of the impact of any assumptions made.
b. Vision and imagination: The capacity to be imaginative, and innovative, and to have a clear vision of the future.
c. Strategic perspective: The ability to be aware of wider issues and broader implications and skills to balance short-and long-term considerations and identify opportunities or threats.
Despite these competencies mentioned above, Northouse (2016) defined leadership as a process whereby an individual influences a group to achieve a common goal. Also, it is identified six styles of leadership: (a) transactional, (b) transformational, (c) authentic, (d) servant, (e) adaptive and (f) spiritual leadership. Each leadership style contributes to and enriches the organization, providing its followers with the tools needed to reach the goals. For example, as stated by Cregard (2017), the literature on spirituality in the workplace has argued that spiritual leadership in organizations can increase workplace productivity and even financial performance at the same time that it increases the well-being and organizational commitment of members who place a high value on ethical leadership. This type of leadership is most related to not-for-profit organizations, which is a topic of interest. This interest comes for two main reasons: (a) nonprofit organizations whose leaders follow the spiritual leadership model are implicitly communicating their concern for followers' physical and mental well-being, and (b) it is often charged that nonprofit organizations, especially those in the public sector, are unable to motivate followers in the way that for-profit organizations can.
Risk Leadership
Risk aversion is an individual difference variable of some importance in economics. It is referred t as a preference for stable outcomes. In other words, it is a construct that captures an individual's level of comfort with unknown results. Kulas, Korma, and Grossman (2013) stated that there is not enough research on the leader's risk preference. As stated in the initial presentation, project management is often concerned with improving the current condition. It can, therefore, be viewed in terms of a process moving from a problem or an opportunity for improvement toward a solution. The concept of project risk management comes alive, seeking a possible explanation for the organizational project problem. Sarfaraz (2019) stated that the goal of every project is to achieve the project objectives within the primary constraints of time, quality, and budget. Every project is unique and complex, which requires risk management. Risks can have significant impacts on the project. Risk management is used in projects to identify and analyze risks, determine how to manage a project best, and utilize resources.
In academia, risk management definition includes (a) risk identification, (b) risk analysis, (c) risk planning, and (d) risk monitoring. Debnath, Uzal, Montejano, and Riesco (2006) change mismanagement is a machine of risk situations creation. It is stated that the project leader calls risk issues instead of change management skills to lack. Successful change management requires leadership. Successful change management includes three progressive (interactive and interactive) steps: (a) unfreezing the present level of performance, (b) moving (improving) to a new level, and (c) freezing group life at the new standard. Also, it is suggested a three similar part framework: (a) defrost the status quo, (b) take actions that bring about change, and (c) anchor the changes in the corporate culture. For example, to defrost the status quo, leaders must establish a sense of urgency. A leader should examine market or competitive realities and identify an urgent need in terms of a crisis, potential crisis, or great opportunity. The second element, which takes action that brings about a model change, includes three steps. The first step is to empower others to act on the vision. The second action step is to plan for and create short-term wins, and the third step arises from the second consolidating improvements and producing still more change. For the third element, anchoring the changes in corporate culture, it is suggested a single step. As leaders create effective changes, leaders must now make the changes permanent by using the force of recidivism (Debnath, Uzal, Montejano, and Riesco, 2006).
Maladazhi (2015) stated that there had been a dramatic increase in globalization over the past decades, the rapid pace of technological innovation, a growing knowledge workforce, and shifting social and demographic trends requiring organizational change leadership. Business leadership has been described as "the dynamic process of presenting a vision, committing followers and risk acceptance when facing opportunities that cause efficient use of available resources, along with discovering and utilizing new resources concerning leadership vision. Studies state that competent leadership should achieve higher innovativeness through risk-taking, which is recognized as one of the characteristics to measure the innovativeness of leadership organizations. Components of organizational entrepreneurial could be translated as (a) risk-taking, (b) pro-activeness, and (c) innovativeness but understanding that these three characteristics do not make one leader. However, the ability of an individual to influence, motivate and enable others is central to being a leader. For example, entrepreneurial leadership manages to encourage and stimulate employees with risk-averse behavior. Maladzhi (2015) stated that companies must eliminate the fear of risk by providing training and setting an example for risk culture. When employees are exposed to exercise, they develop attitudes, skills, confidence, and capabilities to deal with the unknown.
Research Topic
Values and Ethics
Values are the primary motive of our activities and endeavors. They provide us with orientation and serve as a basis for responsible decisions. To make daily choices about good or bad behavior easier, societies and groups develop principles and rules that guide our conduct. These morals are codified convictions and expectations as to what is considered good behavior. Ethics are the systematic combination of values and morals to enable rational and values-based judgments and decisions about what should be done. Ethics include criteria and processes allowing to arrive at or assess personal choices or behavior in terms of good or bad and right or wrong.
Ethical decisions making tends to be secure in the case of one option serving one value. Facing several options serving one value or conflicting choices, it is necessary to enter a decision-making process based on ethical considerations helping to sort out the moral dilemma and arrive at an ethically sound decision. Ethics deals with the right actions and good results. Project management strives to meet project requirements through project activities. Hence, every aspect of project management involves ethical considerations and may produce a moral dilemma. However, ethical hotspots in project management are areas of interest to the public and issues that touch on essential, generally known as accepted values (human rights, preservation of our environment, financial honesty, etc.).
Project management has been acknowledged as a relevant, knowledgeable field of study considering the huge socio-economic impact of projects on our lives and society. Through the project, we create our future. As stated by Bredillet (2014), the project activities situations, and contexts are managed and led by project managers, making decisions, using professional and industry standards practices, complying with all kinds of regulatory rules and regulations, managing pluralistic or conflicting interests amongst various stakeholders and committed to delivering the best possible outcome. Competent project managers are acknowledged as important actors leading to successful projects and successful organizations. Project managers face the tension between decision-making based on facts, i.e., what "is" and also on values, i.e., "what ought to be," doing "right," i.e., using "the right means" in practice, finding the "right" balance of duty towards stakeholders with pluralistic or conflicting interests, delivering the "right" outcome, i.e., the best possible "end." These tensions are all deeply rooted in ethics (Mengel, 2015).
As stated by Kiani, Hossein, and Abdi (2018), managers must ethically create an atmosphere or a healthy environment for employees to increase their productivity and not get into trouble in terms of good behavior. Many countries in the industrialized world have grown mature, disregarding ethical issues and fleeing social responsibilities and obligations, leading to their disappearance. This argument may be attributed to the fact that work ethic, in particular, is believed to reflect an individual’s attitudes towards various aspects of work, including a preference for activity and involvement, attitudes toward monetary and non-monetary rewards, and the desire for upward career mobility (Kiani, Hosseini and Abdi, 2018). This last statement could be attributed to the individual behavior trying to mirror the organization's corporate culture.
Dalcher (2014) stated that mirroring the corporate culture, the area of ethics is assuming greater importance in project management, with most professional associations establishing professional codes. With an increased focus on the discipline's professionalization, there is an implicit expectation that project managers will behave ethically and professionally, discharging their duties morally and responsibly. As a component of such professionalism and discipline implicit in leader behavior, value-based leadership takes form and importance in project management within the organization. Value-Based Leadership's concepts, values, and skills emerged from the path-goal theory and the transformational leadership approach that requires a solid trusting and ethical partnership between the leader and team members. Northhouse (2016) stated that the path-goal theory provides a set of assumptions about various leadership styles that interact with the characteristics of followers and the work setting to affect the motivation of followers. For example, leaders who advocate for their subordinates benefit from the leader's ethical values and reflection of the organization's structure and systems.
There are six centric principles of values-based leadership, stated by Walker and Moylan (2014), described as follows;
1. The leader's role in stakeholder development is to transform himself, his follower, and the organization's focus on accomplishing the vision with creativity and enthusiasm.
2. The leader's role in creating this vision epitomizes the leader's core values and helps target the follower's actions.
3. The leader creates a culture supportive of the core values that contribute to the team achieving its personal and group goal.
4. The leader's preparation for the personalized relationships with their followers that amalgamate the personal values, self-purpose, and methods with each other in a council-like, two-way counseling exercise.
5. The leader's ability to be a teacher of their followers, coaching on improving personal relationships, work skills, and attitudes to enable, empower, and energize them to higher performance.
6. The leader’s dual goal of producing high-performance and self-directed followers with an inherent loyalty to the organization and the group mission.
These six principles of G.W. Fairholm constitute the philosophical base for value-based leadership, which is much appropriate for leading transformational change initiatives, which in a particular manner requires a change in corporate culture and personal behavior of what is right or wrong, the ethics of project management.
Projects are understood in organizations as temporary, with unique features that set them apart from permanent organizational forms. For example, a project has a strong focus on achieving a goal and is time-bound, often clearly defined, and with a specific budget (Ljungblom and Lennerfors, 2018). With this in mind, the project is detached from the organization day to day business. Still, it remains affected by the organization's surroundings, including corporate culture and leaders' behavior. Acknowledging that projects are temporary, leaders must understand the importance of ethics in each project. In academia, Ljungblom and Lennerfors (2018) described five central dichotomies that differentiate the temporary from permanent forms, which highlight the potential reason why project management ethics is relevant to business ethics. These five concepts could affect ethics in the following ways:
1. Temporariness indicates that a project is limited in time, which can affect ethics, introducing even more time pressure than in the permanent organization.
2. Uniqueness indicates that, to a greater extent, new situations might arise for which there are no clear rules or standards that can be followed.
3. Heterogeneity/diversity points to the number of different stakeholders involved in the project, which can also result in value differences or even value conflicts between stakeholders, which could aggravate ethical issues.
4. Informal coordination within the project and ambiguous hierarchies indicate that the relationships between the different stakeholders of a project are not always clearly defined, which also emphasizes the relevance of soft skills, for example, ethical judgment.
Since 1998, there has been an ethical code to help the project manager deal with ethical issues: the PMI Code of Ethics and Professional Conduct. The code describes what is expected of project managers and their fellow practitioners in the global project management community (Project Management Institute, 2018; Walker & Lloyd-Walker, 2014). In the introduction to the code, it is stated that:
“The purpose of this code is to instill confidence in the project management profession and help an individual become a better practitioner. We do this by establishing a profession-wide understanding of appropriate behavior" (Project Management Institute, 2018, p. 1)."
This code of conduct had the purpose of addressing any ethical issues encountered in project management such as (a) fraud, (b) data fabrication, (c) falsification, (d) plagiarism, and (e) conflict of interest. Some of the benefits of managing ethics in project environments are to lessen liability and maintain the professional integrity of executives and project managers. Mengel (2015) stated that managing ethics has proven to provide companies with financial advantages and improved public image. Beyond improving public image, this ethical reasoning and values-oriented leadership become part of a comprehensive organizational and project strategy to maintain the moral course during turbulent corporate times.
Future Directions
Ethics are the systematic combination of values and morals to enable rational and values-based judgments and decisions about what should be done. Ethics include criteria and processes allowing one to arrive at or assess personal choices or behavior in terms of good or bad and right or wrong. Ethical decisions making tends to be accessible in the case of one option serving one value. Facing several options serving one value or conflicting choices, it is necessary to enter a decision-making process based on ethical considerations helping to sort out the moral dilemma and arrive at an ethically sound decision. Ethics deals with the right actions and good results.
Ethics is the purest form, boils down to the science of duty and compulsion, which governs human conduct, valuing the nature of virtue and right action, regardless of the outcome for the individual. Araujo Galvão, Abadia, Parizzotto, de Castro Souza Pião, and de Carvalho (2017) stated that this environment provides practical and cognitive trust among professionals who will make one feel part of the whole. On the other hand, situations in which ethical conduct is not reinforced can lead to different actions and behaviors of the manager, even if it results in acting differently from the framing of ethical issues they consider. For example, corporate corruption is infrequently reported, resulting in fines, punishments, and even the unfeasibility of the organization’s activities caused by unethical conduct and violation of regulations.
In the context of projects, organizations have to work, develop, and invest in ethics. As stated by Araujo, Abadia, Parizzotto, de Castro Souza Pião, and de Carvalho (2017), the ethical principles of a company reflect how projects are managed and executed. Team members will adhere to the ethical principles throughout the life of the project to mirror the corporate culture and personal behavior of the leaders in the organization. The success of a project could benefit and impact a group of stakeholders and prejudice others, significantly when the project itself could affect different sides of society and with high impacts in environments. For example, an office of compliance could be the best resource to address any concern related to ethical issues, including violation of federal laws. In the future, offices of agreement, code of ethics, ethical commutes, and code of conduct could be tools used in organizations to address ethical issues in projects, which by academia are identified temporarily.
References
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