Pergamon International Journal of Project Management Vol. 16, No. 1, pp.

15-19, 1998
~ 1997 Elsevier Science Ltd and IPMA. All rights reserved
Printed in Great Britain
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Change management--A key

integrative function of PM in
transition economies

Vladimir Voropajev
The Russian Project Management Association--SOVNET, r. 1303, 29 Vernadsky pr., Moscow 117943,
Russia

The 90s are characterized by the intensive Project Management promotion into developing and
transition economy countries, new non-traditional spheres of activity with sharp increase of
intensity of changes in projects and their environment. These processes require new understand-
ing and searching new approaches to solving the problems of traditional Project Management
adaptation to new conditions. The present paper proposes to introduce a new Key Integrative
Project Management function--Change Management, into the core of PM international BOK
during the process of Project Management globalization and unification. This function is more
general than traditional Configuration Management, Overall Change Control, Strategic Man-
agement, Risk Management, etc. The necessity of introducing the function of Change Manage-
ment is substantiated and its context is specified in the paper. The major processes of managing
changes in projects and their environment are described. In spite of the fact that the problem
itself and some elements of the paper are not entirely new, a fresh view to the problem and new
systematized approach to solving this task, which is one of the most actual problems today's in
the Project Management, are given in the paper. © 1997 Elsevier Science Ltd and IPMA
Keywords: Change management, key integrative function, project environment, project changes, change forecast and
detection, protection plan, change control

The process of PM global unification, which has been
rapidly developed lately and PM promotion to devel-
oping and transition economy countries I requires new
approaches to PM understanding in developed
countries with stable economies. Consequently, PM
BOK should be formed as a basis for PM unified
development.
In this connection the world community of project
managers should answer the following questions:
What is the essence of PM specific features in
unstable social and economic environment, peculiar
for developing and transition countries?
What is the influence of such features on PM
understanding and the process of PM B O K form-
ing?
W h a t is the structure and content of global PM
BOK?
Is it possible to perform PM BOK global unifica-
tion for stable and unstable environments, for devel-
oping and developed countries?
W h a t is the place of project changes and its en-
vironment in transition economies in PM B O K and
in what form should they be described in PM BOK?
In the present paper the author proposes to intro-
duce the function of Change Management in PM
BOK, basing on his experience of work in conditions
of reforms in Russia and PM status analysis in other
countries with unstable economy. Change Management
should be presented as a Key Integrative P M function,
which will allow, to his opinion, to take into consider-
ation all factors of changing peculiar to unstable social
and economic conditions.
Substantiation of introducing new key integrative
function is given in the paper as well as its detailed
description.
Martin Barnes's remark that all countries of the
world can be considered as developing to a certain
extent, 2 allows to make a conclusion that the proposed
approach is general enough and can serve as a contri-
bution in forming global PM BOK, taking into con-
sideration the special features of PM development in
transition and developing countries.
The paper can not be considered as a final solution
to the problem and is only the author's point of view
and a subject for discussion.

15
Change management m transition economics: V Voropajev
Why change management?
Project implementation in conditions of modern
Russia, which builds a new society on its way to the
market economy, is connected with intensive dynamic
changes and risk, caused by these changes. This can es-
pecially be related to large long-term investment pro-
jects and programs. Risk factors increase by many
times for spheres, which are not traditional.
PM is traditionally understood as management of
changes, while in conditions of modern Russia and
other developing and transition economy countries this
definition should be substantially updated. Here,
Project Management is 'managing changes in changing
"parent" organization caused by external environment
changing'. Such definition is very similar to one given
in 'Project Management In Chaos'. 3
What changes should be taken into consideration?
Here we talk about changes, which may cause pro-
ject context changing, as well as the process of its im-
plementation. Let us emphasize principal kinds of such
changes:
( A ) Distant project environment
• Political aspect with its global influence to all
spheres of social and business life.
• Legal and normative aspects, influencing stability of
economy, business and other spheres of life and ac-
tivity of society and individuals.
• Social aspect, influencing social maintenance, system
of values, needs, social behavior and abilities to
socially useful activity.
• Economic aspect, influencing both property relations
and stability and efficiency of economic processes,
including investment sphere and production re-
lations.
• Financial aspect, connected with stability and re-
liability of money turnover and credit system, system
of taxation, tariffs, etc.
• Ecological aspect, influencing environment of project
area inhabitants and all mankind and establishing
its own requirements to project implementation.
• Technological aspect, closely connected with the level
of technical development and labor productivity.
• Organization aspect, influencing flexibility and accu-
racy of functioning all vitally important institutions
and structural formations of society, economy and
business.
• Other external factors, which are able to influence
project implementation and success.
( B) Close environment
Changes in parent organization are mainly caused by
and respond to external environment changing with
factors mentioned above and, in their turn, inevitably
influence projects implemented within such organiz-
ation.
The following changes can be emphasized here:
• Changing the property relations within parent or-
ganization, connected with privatization of organiz-
ations, which leads to changing internal production
16
relations, including changes in so called stock-
holders/stakeholders and their relations, etc.
• Changing the market of products, services and sol-
vent demand in the sphere of interests of organiz-
ation.
• Changing the concept of strategic organization
development, its internal social and economic policy
of business, its long-term and tactic purposes, kinds
of activity, production, etc.
• Changing organization forms and structures.
• Changing production system and technologies.
• Changing organization internal infrastructure.
• General changes in the company's behavior and cul-
ture, style, system and methods of managing, which
are adequate to new conditions and requirements.
• Changes in the ways of communication between
local companies and the international business com-
munity.
• Other changes, influencing projects within organiz-
ation.
( C) Project changes
Changes of types A and B occur mainly in conditions
of reforming and are consequences of reforms.
Though, other circumstances may cause such changes,
as well. It is important to emphasize that lots of
changes are unforeseen and may arise any moment
during project life-cycle. Their influence on project
may prove quite considerable and in some cases fatal.
To sum it up, project changes are caused by both
external environment and internal reasons, connected
with process of project implementation, its progress
and achieved intermediate results. The spectrum of
such changes is very wide. It is described in details in a
number of publications (see for example4-1J).
Therefore, here we only touch upon spheres and com-
ponents of projects, which can change in the process
of project implementation.
• Scope--changing project results, its configuration,
purposes of project implementation, criteria for pro-
ject success estimation and so on.
• Quality--changing specifications of requirements to
project as a whole, parts of project and project im-
plementation.
• Time--changing dates of achieving intermediate and
final project results, duration of activities, project
parts and project as a whole.
• Cost--changing cost of work and other project ex-
penses, changing terms and schemes of financing,
spending plan and other project cost characteristics
and indices.
• Risk--changing both possible risk factors and prob-
ability of their occurrence and possible project loss,
changing conditions and methods of risk protection
and reducing during project implementation and so
on.
• Contract/Procurement--changing the requirements
to contract relations under the change of state regu-
lations, prices, demand and other factors; changing
the context and terms of contracts themselves.
• Human resources--changing the structure of project
participants, system of motivation, distribution of
responsibilities and so on.

• Communications--changing the system of communi-
c a t i o n s - b o t h external and internal for the project,
informational needs of project participants and
methods of information supply.
• Other changes in project.
(D) Key integrative process changing
Changes of A, B and C types inevitably require
changes in key integrative processes and procedures in
order to provide appropriate correction of documents
and results.
The following changes can be mentioned here:
• Changing the system of project planning: the structure
of indices to be planned, requirements to the level of
information aggregation, frequency of plan correc-
tion, methods of planning, planning documents,
forecast and estimation of possible changes, inter-
face with planning all knowledge areas of Project
Management.
• Changing the project plan execution: input data chan-
ging caused by changes of A and B type, adequate
changing methods and tools for the project plan ex-
ecution and appropriate correction according to the
work results and change requests.
• Changing the Overall Change Control system: chan-
ging and expanding input data, connected with fore-
cast and actual changes of A and B type and
requirements to progress reports and change
requests; changing methods and techniques of con-
trol in order to take preventive measures to keep
project stable; plan correction and actualization.
• Changing the system of documentation. All changes
in project should be recorded in the project docu-
mentation. Such records should be kept during the
whole project life-cycle. It is a very important and
labor-consuming process. Intensive changes in the
unstable environment require changing not only
documents themselves, but also the system of docu-
mentation informational support.
The review of possible project changes in conditions
of unstable environment, given above, allows to sub-
stantiate reasons for introduction of a new PM key
integrative function--Change Management.
To our opinion such reasons are the following:
high intensity and frequency of possible project
changes and their influence on project success;
perturbation caused by changes of project external
environment;
necessity in methods and techniques of environment
change forecasting in order to elaborate the strategy
and tactics of preventive responding. The following
methods can be used here:
• Project environment status and tendencies moni-
toring and forecasting most probable changes.
• Taking measures to avoid or reduce consequences
of changes in project (for example, through co-
operation with Governmental bodies, public re-
lations, marketing research, cooperation with
competitors).
• Preventive measures taken before the predicted
changes occurred;
Change management in transition economics: V Voropajev
Necessity of change control and configuration man-
agement expanding and their integration into the
general function of Change Management.
What is change management?
Change Management is an integral process related to
all project internal and external factors, influencing
project changes; to possible change forecast; to identifi-
cation of already occurred changes; to planning pre-
ventive impacts; to coordination of changes across the
entire project.
So, Change Management faces both the outside of
project--its close and distant approaches, and the
inside of project. Change Management is to solve pro-
blems of project protection from the influence of exter-
nal and internal change factors, introduce all necessary
changes and control the process of changing.
Change Management includes the following pro-
cesses:
project environment status and tendencies monitor-
ing;
forecasting most probable environment changes and
their influence on project realization;
elaboration of strategy and tactics of preventive
responding;
defining most urgent project changes, supporting
approved changes in project;
change control;
change verification--verification of efficiency of pro-
ject purpose achieving through project changing.
Change Management is closely connected with all
project processes and functions, which are exposed to
changes: scope, time, cost, quality, risk, contract/pro-
curement, human resources, communications and
other key integrative processes.
When we introduce a new integrative function of
Change Management we should take in views that the
functions of Overall Change Control and Change
Configuration should be expanded and included into
the Change Management.
Figure 1 shows the overview of Change
Management.
The ideas given above are based on rich author's
practical experience and can be considered as one of
possible approaches to management of projects im-
plemented in unstable social, political and economic
environment.
Here should also be mentioned that many foreign
contractor and consulting firms, working successfully
in the Russian market and widely using PM in their
activity (for example, Bovis (UK), Innomore Oy
(Finland), SPD Int. (USA), Ernst and Young Int. and
so on), now develop specific procedures to provide
protection of their projects by Project Management ad-
aptation to changes of project environment in Russia.
This can serve as a confirmation of actuality of the
problem considered in the paper and ways of its sol-
ution. The key question here is: 'Does the environment
drives in transition economies a new function of PM
or it drives changes and an adaptation of PMT
In conclusion the author once again gives his
approach to answering this question.
17
Change management in transition economics." V Voropajev

Change

I I
I management
I
I I
Change I Change control

I
Project I
forecast and protection plan Plan I and result
detection development execution estimation

Project context changes - Current status and 1, Change procedures 1" - Change monitoring
tendencies monitoring • Requirements • Change control
• Political factors • Discussion
• Data gathering system
• Legal aspects
• Status analysis • Approval • Progress
• Social factors
• Change probabihty • Responsibilities measurement
• Economic factors
evaluation • Progress reports
• Finance, tax, tariffs Change introduction
• Ecology • Impact evaluation 2' Current change and
system 2'
• Institutional aspect - Preventive measures result esttmaUon
• Other external factors • Cooperation with 3, System of change
Governmental bodies 3. Correction
Project parent informational support proposals
organizatton changes • Public relations
• Property relations • Forming demand
• Other 4' Corrective actions 4' Change database
• Development concept
a Status and structure - Internal protection Archive forming
5'
• Behavinur and culture measures
• Production systems • Guarantees 6. Post project
• Infrastructure analysis, change
• Management and • Insurance
communication systems • Liabilities and result
• Other • Inventory evaluation
. Changes of project • Other
• Scope Lessons learned
• Quality 4 Project change plan and strategy
• Time • Objectives, correction
• Cost configuration
• Contract/Procurement • Quality specification
• Risk • Schedule
• Human resources • Budget
• Communications
• Contract / Procurement
• Project process changes
• Project team
• Project
plan system • System of informstinn
• OveraU and documentation
change control • Risk events
• Project Other changes
plan execution
• Project
documentation

Figure 1 Overview of change management

Conclusion of the Strategic Management, Risk Management,

Basing on the above it is possible to make a row of
general conclusions and recommendations, which
should be taken as proposals and working hypotheses.
1. The context of PM specific features in transition
social and economic environment is connected with
dynamic changes of project environment, which in-
fluence the process of project implementation, the
project itself and may cause heightened risks.
2. The frequency of possible changes and their influ-
ence on the project and its successful implemen-
tation, necessity of adequate responding to different
changes require a cardinal solution by introducing
in PM BOK and PM practice a special Key
Integrative function--Change Management, which is
more general than traditional functions of
Configuration Management and Overall Change
Control, or taking measures on PM adaptation to
changes of project environment within the frames
Project Marketing, Personnel Management, etc.
. Introducing new Key Integrative PM function--
Change Management requires revision of all PM el-
ements and functions connected with changes.
. For global PM BOK unification it is necessary and
useful to form its stable core, conforming both to
requirements of stable and unstable project environ-
ment, and supplementary flexible spheres of PM ap-
plication, taking into consideration social,
economic, cultural, regional and other specific PM
features and providing PM adaptation to intensive
changes of project environment, including transition
economies.
References
1. The Global Status of the Project Management Profession, The
Global P M Forum. New Orleans, Louisiana, USA, October 15,
1995, Project Management Institute, 1996, pp. 182.

18

2. Barnes, M. and Wearne, S. The future for major project man-
agement International Journal of Project Management I1(3),
1993, 135-143.
3. Smith, J. A., Project management in chaos. Projects and project
management m Russia and Eastern Europe. In Proceedings of
the Internatzonal Sympostum, Moscow, 7 10 September, 1993,
Moscow: SOVNET/ALANS, 1993, pp. 185-193.
4. Body of Knowledge, Association of Project Managers,
INTERNET UK, Version 2, January 1995.
5. A Guide to the Project Management Body of Knowledge,
Project Management Institute, Pennsylvania, 1996, pp. 176.
6. Cooper, D. F and Chapman, C. B., Risk Analysis for Large
Projects. St. John Wiley and Sons, Chichester, 1987.
7. Morris, P. W. G., The Management of Projects. Thomas
Telford, London, 1994, pp. 358.
8. Turner, J. R., The Handbook of Project-based Management:
Improving the Processes for Achieving Strategic Objectives.
McGraw - Hill Book Company, London, 1993, pp. 540
9. Dinsmore, P., ed The AMA Handbook of Project Management.
AMACOM, New York, 1993, pp. 489.
10. Lichtenberg, S. and Archibald, R. D. Analyzing project under-
tainties and change using the successive principle. PM
NETWORK The Professional Magazine of the PMI IX(5),
1995, 10-14
11. Voropajev, V I., Project Management in Russia. Moscow:
ALANS/SOVNET, 1995, pp. 226.
Change management in transition economics: V Voropajev
Vladimtr I. Voropajev Hydrotechmcal engineer, majoring in
melioration (1957); Ph.D. in Mechamcs of Soils, Bedding and
Foundations (1966); D.Sc. in Construction of Melioratton Systems
(1987); certified Professor of Management Information Systems
( 1991 ), correspondent member of the Russian Federation Academy
of Natural Scwnce, the Informatics and Cybernetics sectton
(1992), Academician of the Russian Academy of Investment and
Construction Economy (1993). Head of the Theory and
Methodology of Construction Management Systems Department in
the Experimental Research Institute for Automating Systems in
Construction (1971 1974), Head of the Department of MIS for
Water Supply Construction tn the Research Institute for
IIydrotechnique and Mehoration. General Designer of MIS
Systems for Minvodkhoz of the USSR (1974-1987), Deputy
Director of the Central Research Instttute for Construction
Economy and Management (1987); Professor of the Moscow
State Construction UniversiO, (1991). President of the Russian
Project Management Assoctation SO VNET (1991); Vice
President on Developing and Transttion Economy Countries of the
International Project Management Association, IPMA (Zurich,
Switzerland) (1991).
19