It takes two to tango: Product-organization interdependence in managing major projects

Purpose: The purpose of this paper is to develop further understanding of the interdependence between product and organization subsystems in the context of major projects by empirically elaborating the volume-variety matrix. Design/methodology/approach: Projects are perceived as systems that include a product subsystem (the project outcome) and an organization subsystem (the temporary multi-firm organizational network that produces the project outcome). This study addresses product-organization interdependence by analyzing product and organization subsystem components in terms of their uniqueness and reuse across multiple projects. The empirical analysis focuses on four global renewable fuels refinery projects implemented by Neste from 2003 to 2011. The refineries are based on the same proprietary technology but are unique at the project level. Findings: The findings indicate interesting interdependencies between product and organization subsystems when analyzed at the component level: the findings suggest both diagonal and off-diagonal positions in the volume-variety matrix. An example of an off-diagonal position is a reused organization subsystem component associated with a unique product subsystem component, meaning that choosing the same organization in a future project can be used for acquiring an improved and, thereby, unique product subsystem component. Originality/value: The study elaborates upon the volume-variety matrix in the context of major projects. The findings related to off-diagonal positions in the matrix provide new knowledge on combinations at the component level where a reused organization can be associated with a unique product, and vice versa. This has direct implications for management of projects.