Track: Project Management

Abstract

Challenges in Project Management for Startup projects in select African countries

Girish Kelkar, Ashok Pundir, L Ganapathy

National Institute of Industrial Engineering (NITIE), Mumbai

Abstract

Several African countries are struggling through various phases of economic and social development and are grappling with challenges of accelerated rate of industrial and economic growth. While such a situation opens up opportunities, it also throws up several challenges in execution. As in any fast developing country, it is expected that there will be considerable project oriented activity in the African continent in the next few decades. Many economists and management thinkers have pointed out that a major international business destination for such projects in the coming decades will be Africa. This has drawn attention of the project management professionals to project execution in African countries. Starts up projects are major vehicles of growth in any emerging economy and it is expected that such projects in developing economies are successful. However, projects environments in ‘African’ countries have numerous peculiarities and one must pay attention to these for the success of projects in this region. A good understanding of such challenges may be crucial to ensure the success of projects in such countries. This paper attempts to understand some of the significant common challenges for setting up new projects, especially startup projects, in African countries.

Keywords: Critical Success Factors (CSFs), Startup Projects, Project Success Criteria, Project Management Process Parameters, Project Success, Developing Economies.

1. Introduction

The business world is changing every day and the rate of change has accelerated in the last the last few decades. One can see good growth in some economies and slowdown in the other economies. Due to ever changing technologies, the complexity of the business world is changing almost every day. Researchers have pointed out that analysis of ‘Critical Success Factors (CSFs)’ and ‘Risk-Factors’ can help understand the underlying challenges in projects in general and African projects in particular. This analysis can help to develop effective strategies & proactive actions to avoid such traps that can mar success of these projects. It is pertinent to note that since different countries are in different stages of industrial and economic development, apart from generic problems there are peculiar issues in each country.

To set the context for this paper, we note that many ‘Young Africans’ are educated and trained in the western countries and they would like to see that the current ‘state of the art technologies’ are invested into and implemented in their countries. Hence, when projects are taken up, especially technically complex projects, they do not go through the usual process of evolution in terms of technology (as the case may be in many Asian countries). Thus, projects in African countries are in the process of ‘leapfrogging’ in terms of choice of technology. Although while this approach is logical, (since they are adopting such technologies in the recent times), this can lead to more complex situations and pose additional challenges for execution of the projects in such countries. This paper attempts to address some of these issues so as to serve as guidance to the prospective project professionals. The cases covered are from startup projects in Nigeria, Ghana and few other countries in Africa.

Many researchers have pointed out that using only the “Iron triangle” of scope / time / cost (with quality as the essence for projects success) is inadequate for measuring “perceived success” and other factors need to be considered. They distinguish between the factors that help improve the outcome of the project (referred to as ‘Project Success Criteria’) and the factors that help improve project management processes (referred to as ‘Critical Success Factors (CSFs)’). Project Success Criteria therefore refer to a group of principles or standards or metrics that are used to determine or judge project success, while the CSFs refer more specifically to conditions, events, and circumstances that contribute to project results. This paper considers ‘CSFs and Risk Analysis’ that are especially relevant to successful completion of projects in African project environments. The factors so identified are classified into the following groups: Strategic Issues, Technology Selection and Infrastructure, Stakeholder Engagement, Operational aspects, HR and people issues, Support from reliable Vendor Networks, and Social, Political, and Cultural issues. The paper is based on the analysis and findings of the case studies and attempts to throw light on CSFs that may help improve chances of project success.

2. Literature Review

Many researchers have carried out research in the ‘Project Management’ as an important subject matter along with identification ‘Project Risks’ as a critical issue for analysis. Additionally KPMG report (2014) identifies project risk management as “a continuous process of identifying, analysing, prioritizing and mitigating risks that threaten a projects likelihood of success in terms of cost, schedule, quality, safety and technical performance”. One must take care of this aspect with due attention especially for startups. Caltrans (2012) in the Project Risk Management Handbook has pointed out that “The survey responses revealed that although project risk management is considered to be valuable, many respondents are not familiar with the current Project Risk Management Handbook or have never participated in developing a risk register”. Anton de Wit (1988) says that “The multitude of objectives throughout the project life cycle, the hierarchical relationship and the often conflicting criteria of the stakeholders can be illustrated by a ‘project success framework”. This conflict also can lead to certain types of risks for the project at large.

Schroeder Brett, John Alkemade, Gordon Lawrence (2011) have pointed out that project risk management was generally a neglected subject in the past the world over. In their observations it noticed that many projects that did not pay specific attention to the subject of ‘risk management’, did not succeed in reality. However they point out that the projects that went through systematic risk management processes turned out to be more successful. In their view some project situations also point out that in many projects the main emphasis of risk analysis was mainly related to technical and financial risk aspects and did not pay attention to other aspects such as market risks, execution risks, human risks, safety and social risk factors.

Jackson Tom (2016) finds that “Africa is an increasingly attractive destination for overseas investment, boasting seven of the eleven fastest growing economies in the world and a young, ‘tech-savvy’ population. Despite the opportunity that exists for companies expanding or investors putting money into Africa, the continent has a number of unique challenges to overcome”. Randy White (2014) while explaining challenges for projects in African Countries states that “In the Western World, we take adequate infrastructure for potable water, electricity and sewage for granted. Not in Nigeria. There a project is more like a self-contained cruise ship; it has to have its own water supply from a well (called borehole there), its own electrical generators since the country’s electric grid is totally unreliable and even its own sewerage treatment”. Mabelebele E J M (2006) from South Africa points out that “poorly managed projects in private and public sectors cost the South African Tax payers a fortune every year in the public service, the challenge is to ensure that optimal benefits are accrued to citizens in whose name the projects are implemented”. Kenneth Omeruo (2014) has pointed out that “It is very surprising and in fact unique to see a lot of foreign investors coming into Nigeria despite the daunting challenges the country is facing even at this time. With several challenges in corruption, infrastructural deficiency and insecurity especially in the North, there is so much more to be desired and talked about in Nigeria than these problems”. Publications from PWC (2014), SIDA (2012), Nexus 2016 have also pointed to challenges faced in Africa startups. One can note from the above that many project managers and authors have expressed their concerns about need to improve project success rates in African countries.

The concept of CSFs was originally proposed by D. Ronald (1960) and was further researched on by John F Rockart (1970) of MIT. Rockart (1970) has defined CSFs as “the limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization / project. They are the few key areas where thing must go right for the business to flourish. If the results in these areas are not adequate, the organizations efforts for the period will be less than desired”. CSFs that are useful for deciding the “Strategy” for the organization / project are considered as core CSFs while the other CSFs are in the supportive group and help in improving operational efficiency. The bring clarity and purpose in every step of the project activity in the light of the overall “Value” of the project.

One needs to note that CSFs are decided based on such factors that help develop insight into such aspects of business or projects that needs attention and help ensure success of the projects. One needs to develop appropriate project control policies and framework and adopt the same to suit a particular environment for a given project. For our context, ‘Project Risk Mitigation’ becomes an important CSF that helps improve chances of overall success of the project. It is to be noted that project challenges and project risks are closely intertwined, and they need to be attended together.

3. Methodology

For the purpose of this study, we use the following definition for a Startup Project: ‘Business Enterprise or a project endeavour that has been launched recently’. The project can be set up by an entrepreneur or a new Strategic Business Unit (SBU) set up by an existing organization in the form of new project endeavour. Again, for the purpose of study and analysis of the data collected, it is considered that the time frame for such ‘typical’ startup projects is a period of the first 5 years. Typically it is seen that any startup unit goes out of the business even if it is not successful only after a period of 3 to 5 years.

A literature survey was carried on CSFs, and in particular, Project Risk Management. The methodology to understand CSFs was based on the structured interviews of the project personnel. Initial interviews of project personnel helped capture perceptions of project success. The CSFs reflected in the literature were used (as applicable and relevant) and the perceptions of project personnel helped to compile list of important CSFs. It may be noted that a comprehensive questionnaire was designed based on the inputs received from extensive literature survey and risk items / issues specifically identified during such analysis. These were further confirmed or refined based on review of additional information compiled from the progress and the analysis of results of similar successful projects carried out earlier.

The research study was carried out using case study methodology (Christie Michael (2000), Brown Patricia Anne (2008), Robert Yin (2014)). The method is qualitative in nature and is used for context sensitive analysis in such situations where there are multiple parameters at play. The study covered 6 cases of startup projects in African countries. The sampling was based on convenience sampling and in such organizations where the authors had personal contacts and the organizations were willing to provide basic data about the project. The respondents were either owners or working as very senior executives in the project. The research question at this stage is ‘What are the CSFs specifically important for the ‘startup projects in Africa’ apart from the conventional CSFs that are common to many types of projects?’.

A detailed questionnaire was administered in each case, followed by detailed discussions with the senior project managers (and his / her team members where possible). In all more than 72 parameters (elemental data groups) regrouped into 19 basic groups were selected based on overall compiled data for all projects and the inputs were used for the design of the questionnaire. The additional discussions and the notes made during these personal meetings helped develop an insight in terms of the intricacies involved in addressing specific project management challenges and issues in the context.

4. Findings based on the case studies for startup projects

While there are many CSFs that have been studied by researchers, and all these factors have effect on the success of the projects, for the purposes of this research, we have selected such groups that have direct relationship only with ‘Project Management Challenges’ (or Project Risk Management, PRM). The specific factors that were noticed / identified based on the data compiled through the questionnaire and detailed discussions with the participants have been grouped under the following 5 groups.

1. Strategic Challenges
2. Company Structure / JV Partners and Challenges for Funding
3. Sales and Customer Relationship Challenges
4. Operational Challenges
5. Social / Political and Cultural Challenges

The following paragraphs provide details of CSFs in each of these groups in terms of the special issues faced by startup units in the African environment.

1. Strategic Challenges

This group of CSFs refers to the general lack of comprehensive planning and lack of flexibility in the project planning for a startup unit. It is noticed that many of the startup units make decision to set up new initiatives without proper strategic analysis of the challenges involved in making the venture successful. This may be because the new entrepreneurs are often technical professionals and lack management training. This can pose serious risks for the startup venture as explained below:

1. ‘Market Opportunity Analysis (basic need analysis)’ and ‘Changes in Market Dynamics’

This is one of the main challenges faced by the startup projects in Africa. The decision to start a new venture is often based not on a careful analysis of market opportunity and customer need (both short term and long term) but rather on ‘gut feel’. Additionally, it is also observed that there is lack of market data in these countries and it is very expensive to conduct the market research and analysis on own. The ‘need analysis’ in the initial stage is not carried out with due diligence and the results are lopsided. The market projections are worked out in an amateurish fashion & could be a dangerous for the project itself. It is noticed that the time span between approvals for the project concept and actual initiation of the project activities is long, between 18 to 24 months. During such a long time gap, the market dynamics can change and thus can present a risk for the entire project. These can pose great challenges for efficacy of the project concept and feasibility of the project itself. Such mistakes or mis-judgements can have severe negative impact and will cascade into other areas of project management such as choice of technology, scope of work, time schedules, quality and safety of the proposed project leading to financial disasters. This is not a trivial risk and one has to take care to avoid such traps.

2. Incomplete or unrealistic Feasibility study

It is noticed that at times the feasibility study is not complete before the project is initiated and investment decisions are made based on ‘hunch’ at times and not based on analysis and sensitivity of the critical factors. A feasible business venture is one where the business will generate adequate cash-flow and profits, withstand the risks it will encounter, remain viable in the long-term and meet the goals of the sponsors and stakeholders. One can easily appreciate that if this feasibility assessment is not carried out with due diligence it may lead the project failure. The venture can be a start-up business, purchase of an existing business, or expansion of current business operations. Feasibility study must include careful identification and thorough examination of all the aspects along with careful analysis of the impact it can generate on sponsoring organization. The task is onerous and needs attention from the senior management. Kelkar, Pundir, Ganapathy (2016) have identified need for Dynamic Feasibility Studies (DFS) explaining the factors that lead to the need for DFS and point out that introduction of DFS process appears to be a must for Indian projects, especially for startup projects. Without adequate attention to feasibility study, the project is prone to failure.  The analysis of the failure cases indicates that this is mainly on account of inability to judge the changes (subtle or major) in the market place and customers’ perception of the basic need itself, leading to faulty or incomplete feasibility study.

3. Flexibility in scope and area of influence for the initial period

Startup projects face many challenges, and need flexibility to overcome them. “Flexibility” in projects, especially for startups needs to be understood from two angles, one at “strategic level” and the other at “project management level” in the project life cycle. Kelkar, Pundir, Ganapathy (2015) suggest the need for ‘flexibility’ at strategic level and at operational level as a critical success factor (CSF) for startup projects. Flexibility at strategic level will address (i) changing Economic Environment and Market Dynamics, (ii) choice of Technology and Technology partners, (iii) choice of mode of funding the project, (iv) equity structure of the startup (change the partners if things do not work out), and (v) choice of local partners for setting up new business units / startups. Flexibility at project management level will address (i) scope management, risk management, (ii) choice of leadership team, (iii) human resource management & (iv) need for effective core team. The risks associated with these factors and importance of flexibility in the initial stages is crucial, especially for African Projects.

4. Choice of Technology & Business Model proposed

Choice of technology (in particular, untried technologies) or method / mode of working or the business model selected to carry out the new initiative assumes critical importance for the success of the project. Additionally it is important that the concept design and basic infrastructure for the project is chosen with due care and attention. Any mistake in this aspect, such as use of faulty design or infrastructure, will lead to disastrous results. The development of infrastructure is upfront and demands lot of capital funds. Once chosen, it difficult to make quick changes in the technology and infrastructure. Hence this has to be done very carefully. It is noticed that ‘change in market dynamics’ may affect these aspects directly and render the current setup redundant. This could then be a great risk for the startup unit and lead the entire project into the zone of failure.

5. Choice of Capital Equipment and accessories

The choice of the capital equipment and the related accessories are dependent upon the choice of Technology and Infrastructure for the new startup. The choice affects capital investments that are onerous and time consuming for installation and trials. Capital investments are committed in the beginning of the project, and once the equipment is decided and installed it is very difficult and costly to make changes. Hence, such aspects need careful consideration for prudent choices that are futuristic and flexible.

6. Availability of ‘Subject Matter Experts’

Many projects seem to get into risky zones if the right types of ‘Subject Matter Experts (SMEs)’ are not acquired as the critical resource persons for the successful implementation of the project. This difficulty has to be addressed head on right from the beginning of the project since they make or mar the project. Keeping such special resource persons in good humour is critical in the interest of the project. An attempt to compromise in the hiring costs for such resources may be similar to ‘penny wise and pound foolish’ attitudes that can be avoided. Lack of such resources (competent and motivated) right from the beginning of the new startup project is certainly an imminent risk for the project. Such issues are also found to affect some of the African projects.

1. Company Structure in terms of Equity Shares / JV Partners and Challenges for Funding

1. Company structure and equity distribution

It is noticed that in case of many startup units, due to paucity of funds in the initial period of struggle the equity is allocated in a hurry to mop up funds without due diligence. This hurry to generate funds by parting with part of the equity (although looks attractive in the initial stages) can generate a ‘death trap’ for the unit over a period of time. Such problems once generated cannot be resolved on the fly since they have severe and long term implications. A wrong choice of such Equity Holders, Joint Venture Partners and Angel Funding Agencies can prove be a great impediment over the project period. It is therefore expected that the decisions to part with equity to any individual, group of persons or an agency should be analyzed from the long term perspective and with judicious due diligence. This looks quite obvious but it is noticed from the case study analysis of (based on data compiled and the discussions with interviewees) actual practices indicate otherwise. One must note that in many African countries, one has to choose a local partner for setting new operations.

2. Choice of Partners and Executive Management

It is rather critical to choose the partners in business and it is pertinent to choose such partners that compliment the skills of the promoters and not necessarily duplicate the skill sets and competencies. The analysis of the ‘failure’ cases indicates that choice of wrong partners or co-directors can send the fortunes of startup unit for a toss. The analysis of the cases also point out that the rift between the founding members could be a major source of the risk for the existence of the newly set unit. Additionally, it may also be pointed out that the ‘basic first team / or core group’ can make or mar the fortunes of the newly formed unit. It is pertinent that every person of the first team must be selected with due care without making compromises to the expected competencies and attitudes in the team. It may be pointed out that in case there are initial signs of lack of compatibility of values and attitudes expected it may be worthwhile to terminate the relationships without emotional dramas in the matter.

3. Need for a ‘Mentor / Senior Advisor’ for the startup unit

Many startup units are set up by persons who are exceptionally capable technically but do not have adequate exposure (or interest) in the business and organizational issues that are essential to set up a successful project. However, the young / new entrepreneurs do not want to hand over the control of business operations to someone else. This situation can pose a severe limitation of the proper management of such projects. On many occasions, the entrepreneurs take decisions that are made on ad hoc basis or sometimes critical decisions are kept pending for too long a time. This risk can be mitigated if the unit decides to appoint a ‘mentor’ to keep track of ‘critical issues’ & guide the unit in the initial period of development where there is a higher possibility of risks (that could threaten the very existence of the new unit). From the case studies, field work and interviews it is confirmed that startup units that made efforts to seek advice from the ‘mentor’ finally completed the project with success.

4. Choice of funding agencies (Funding agencies and Financial Institutes) and realistic Financial Analysis and Planning for contingencies

During the discussions with various leaders of the project case studies, it was seen that many startup units part with certain portion of equity to the investing organizations when the new unit is in a tight spot with funding / cashflow constraints. This could prove to be an eminent trap of risks for the startups. However, it is also noticed that the main cause of the problem leading to cash-trap is unrealistic project plan and inadequate projections for funds required coupled with ‘hopeful (over optimistic)’ attitudes of the entrepreneurs leading to obvious errors in terms of financial planning. It is noticed that startups are set by so called ‘foolhardy’ persons willing to put their life time earnings and reputations on the line. This foolhardiness is the main input for the startup unit on one side, but lack of planning cannot be explained. Similarly, certain aspect of ‘flexibility’ in the planning itself may help salvage such cash traps that are seen across almost all startup units.

1.  Sales and Customer Relationship Challenges (and need for many ‘anchor customers’)

Managing Sales is a challenge in its own way, due to peculiar situations in the African Countries. In many cases the sales deals for a startup venture are made not necessarily on the technical, quality and costs basis but on the strength of relationships and trust. Sometimes the startups are set up based on the long term promises from a large local companies or MNCs to the proposed startup. This is indeed a good situation for the new entrepreneurs and one can attempt to make good use of such promises. However, it may not be prudent to tie all the options only to a single customer as a long term strategy for the proposed unit. It may be wise to ensure that right from the beginning the unit makes planned efforts to enlist support from other customers for the products or services supplied by the new venture. Flexibility should be built in as a necessary part of such funding plans since there can be many unforeseen issues that can spring from nowhere (Kelkar, Pundir, Ganapathy (2015)).

For any startup unit it is difficult to plan and improve ‘visibility’ and ‘reach’. Due to unplanned marketing activities, the unit suffers heavily in the initial period. One needs to secure the market volumes right from the beginning. It is noticed that there are several cases where the unit has been initiated without a detailed Business Plan and adhoc decisions were made to start the unit. It is important that the startup units are effective in terms of developing long term relationships with many ‘anchor’ customers. Failure to concentrate on marketing may lay risk traps for the newly formed units. The analysis of cases of failures confirms this view point.

1. Complex permissions / certifications (and considerable delays due to local factors) from Government authorities.

It is noticed that projects which are located in the remote / mofussil locations have peculiar challenges due to interference by special interest groups. This is compounded by the fact that at such locations getting clearance for the land and other permissions such as land allocations, work permits and electricity / power sanctions (and power line installations) and many other clearances from various authorities is a big bottleneck for the project teams. These issues can take huge time delays and can throw all the plans and budgets out of gear. Such issues mar the prospects for many startup units in African countries. Lot of managerial time and energies are simply wasted in these issues. Building good relationships before hand with the concerned stakeholders and authorities may help address such issues.

5. Inconsistent and changing demands from various groups of stakeholders

The project situation can also become complicated if there are conflicting demands from various stakeholder groups. Such issues are risk traps and are generally not accounted for in the budgeting exercises and hence tend to become a pain point in the future. Careful analysis of stakeholders (known and hidden) should help avoid such risk traps to ensure overall health and success of the projects. It is noted that it is critical to pay attention to ‘hidden stakeholders’ right from the beginning since they can spring surprises in the project environment at any time to the embarrassment and losses for the project. One has noticed cases of ‘hidden stakeholders’ creating major issues leading to complications.

6. Unprecedented challenges for clearance of pending dues (no direct correlation with deliverables)

One can easily appreciate that all the startup projects are cash trapped almost all the time till they reach stage of maturity and stability of the operations. Additionally it is noticed that the newly formed units also promise unrealistic delivery periods and this itself can be a risk trap for the project. Such things happen more often in startup projects where everyone is trying to establish a position of strength in the market. However getting trapped in cashflow crunch may not be a desirable option for such projects. One needs to pay lots of attention to provision reasonable funds allocated and good cashflow forecasts. However in spite of analysis and careful planning, this issue is vulnerable and things go wrong most of the time.

1. Operational Challenges

Project environment is full of uncertainties and hence there are many aspects that need to be addressed for mitigating the risks and obvious traps. Projects need multi-disciplinary personnel and this itself is a great challenge for every project manager.

1. HR Issues

HR issues are certainly a continual challenge for the project organizations. It is obvious that startup projects have to face these challenges in African countries as well. It is very clear that attracting good and appropriate talent will continue to haunt the leaders of startup projects. There are two main reasons for this situation in African projects: (a) the startup units do not have enough funds to pay competitive compensation and hence talents cannot be easily attracted to these units. This is quite a challenge indeed, obviously leading to risks, and (b) Experienced ex-pat personnel do not have adequate motivation to join the startup companies due to uncertainties and safety challenges associated with these units. This is true in general for all the positions but mainly for the critical positions in the project. Senior personnel are a rather tough challenge for all PMs for the startups in African countries. Additionally it may be noted that local experienced seniors may not have exposure or orientation to new technologies being introduced in the startup projects.

Further, startup projects in remote locations / mofussil locations find it difficult to attract adequate manpower for the project execution. Added benefits and special arrangements for accommodation have to be provided for such situations. This can pose severe limitations for the project. Many organizations set up training facilities much in advance to train locally available personnel and then offer them suitable positions to solve such problems. Such efforts need funds and hence a challenge for the startup units that are cash trapped. The original planning should provide for expenses.

Startup projects by their inherent nature, full of uncertainties and fair amount of chaos in the initial phase, demand exceptional team work from all the members of the team. Along with good team behaviour, it is also important that the as such people need to develop right and positive attitudes and behave as a homogenous unit. Such issues not handled well can give rise to eminent risks in the project environment. In many cases people with different cultural and societal norms (and language as well) can pose great difficulties in smooth working of the team

It may be noted that the project activities in terms of innate complex environments and uncertainties, processes and challenges involved are very different from conventional operational activities. Projects need flexibility, accommodation and ability to deal with paradoxes by the team members assigned. This is very difficult to achieve in practice, and is a significant problem in African countries, resulting in a slower pace of work.

There is a need for ‘excellent communication skills’ and frequent communication with stakeholders. Project of any size involves multiple agencies and stakeholders and this makes the communication extremely complex (language, mannerisms, mode, style, content as well as frequency). The individuals involved have different mind sets and different expectations from the project. Hence the problems (like miscommunications) take monumental proportions and lead the projects towards failure zone. Clarity of purpose and direct, simple and clear communication is the key for success for any project in the world, especially startup projects in Africa. Adopting style of communication to suit local norms and practices may be the way to effectively handle such a problem

Further, there is a need for appropriate HR practices in line with local social norms to deal with local issues. Since the new startup units are generally set up by ‘techies’ who are experts in their respective fields but do not have overall exposure to other disciplines of management activities, this can create typical HR challenges. Consulting local experts in these areas may be useful to manage such matters. Appropriate orientation and good training for work norms and discipline may go a long way in managing such situations in the long run.

2. Lack of support in the form of active network of reliable local suppliers

It is noted that most of the startup units depend heavily on the network of reliable suppliers and vendors / consultants. However startup units neither have good image nor reach in the market for quickly setting up good and reliable network of suppliers and vendors in the beginning. This can pose quite a risk to the project as such in Africa. Similarly it is also important that in remote locations it is difficult get timely support from local vendors for certain specialized skills leading to overall delays. This can pose major impediments in the project environment. One may have spend special attention to such issues and ensure proper mitigation actions.

3. Mediocre performance from the critical EPC contractors

In many types of projects, execution needs expert contractors; however it is noticed that EPC contractors are selected on adhoc basis. Such mistakes / mis-judgements are very difficult to judge in the initial phase. However once the execution starts the lack of performance is noticed and it is too late. Judicious ‘due diligence’ and proper legal documentation (with possible exit clause in the contract document) may help manage the situation in case of problem situations. Any mistakes in this area could prove to be fatal for the project at hand. Additionally even the contractors face many hurdles due to lack of logistics support in many locations.

4. Lack of control systems and availability of dependable /authentic data on the operations and ‘technical /project process details’

One of the major drawbacks, and significantly critical for the startups, is the lack of management and project control processes right from the beginning. In most of the cases the due attention (that this aspect deserves) is either completely missing or is lukewarm. This can pose an eminent risk for the welfare and success of the project itself. This critical aspect cannot be neglected since it provides vital inputs for judicious decision making to ensure healthy growth for the organization.

1. Social and Cultural challenges

1. Cultural mismatch and location based peculiarities

Cultural mismatch between different locations can create many fold problems for the projects. Differences in cultures certainly affect work output norms, methods of communication and developments of effective relationships, camaraderie between team members, methods of influencing and thinking, difference in expectations and motivation norms. The problem becomes even more complex if the team members belong to multiple nationalities. It is essential that such teams need to undergo cross-cultural orientation and training. Additionally it may be useful to increase the interaction through informal group gatherings and combined activities. Such efforts help resolve some of the commonly noticed issues such as specified below:

Different countries have peculiar mind sets concerning social values, work environments and norms for work. Conflicting practices can pose challenges for the teams at work. Many of African countries have pre-determined expectations (influenced by peculiarities of local culture and practices) about work norms and compensation (irrespective of the efficiency and competencies at work place). This can pose great challenge for such projects. One needs flexible mindsets that are required for success of multi-location based projects due to cultural mis-matches. This is certainly not easy to change. Normal living standards and facilities for the expatriates are far from expected standards in many locations and hence many of the expat experts are not willing to work in such locations. Personal safety and threat to property are common situations in many locations. This can pose difficult challenge for these projects.

2. Multi-country based teams

Multi-country based team members is becoming a reality and it is imperative to address such aspects before they become operational impediments for the actors in the project. Additionally if the teams are ‘virtual teams’ then there is a possibility of very different complexion of the problems that can derail otherwise well running project. Working on African projects, it is imperative that such issues are well anticipated and dealt with properly.

3. Unpredictable and Unstable Socio-Political environment

Unsafe political instability and turmoil is also an important concern in many African countries. Although the local authorities make lot of efforts to manage such situation in difficult times, it continues to haunt many team members during their stay in such locations. Sponsors and project managers need to pay attention to these aspects.

5. Conclusions

It can be seen from the analysis that the ‘Startup Projects’ have now assumed a position of significance for the overall growth of the various economies in Africa. In this context it is vital that the success rate for the projects should improve in a significant way to ensure achievement of targets set for the economic growth in the respective countries. This means one should be in position to identify and control the challenges and risks associated with the project environment in general and for the startup projects in particular.

The study undertaken and the analysis of the data compiled during the case studies and field work point out several factors that need attention while carrying out such projects, especially startup projects. The issues identified in the paper will go a long way in helping proposed startup projects to take appropriate care while carrying out new projects through all the stages till closure and handover. Project professionals can certainly benefit from the findings of this study. The study findings can be further enhanced if there is research extended to additional startup segments of the industries in such countries.

The paper is based on the findings of the case study results analyzed by the authors and attempts to throw light on critical success factors & risks that may help improve probability of success for the projects undertaken in these countries. The critical success factors so identified are classified into the following groups that are generally seen in African projects environments: Strategic Issues, Technology Selection and Infrastructure, Stakeholder Engagement, Operational aspects, HR and people issues, Support from ‘reliable vendor networks’ and Social / Political and Cultural issues. From overall analysis one can conclude that the specific aspects that are peculiar for setting up new projects in African countries should take care of the group of CSFs identified in the sections above must be paid due attention and care to avoid project failures and embarrassments in such projects.

6. References

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Nexus 2016: Publication from Norton Rose Fulbright: Nexus 2016, A global infrastructure resource:

Publication from PWC (2014): Capital projects and infrastructure in East Africa, Southern Africa and West Africa Trends, Challenges and future outlook, www.pwc.co.za/infrastructure

Publication from SIDA (2012): The Africa Enterprise Challenge Fund-Collaboration with the private sector

Rockart John F. & Nancy S. Forster (1970, 1989): Critical Success Factors: An Annotated Bibliography, June 1989, CISR WP NO. 191, 3041-89, Massachusetts Institute of Technology, (Center for Information Systems Research), Sloan School of Management,

Schroeder Brett, John Alkemade, Gordon Lawrence (2011): Risk management-a Key requirement for project success, Pharmaceutical Engineering,  Jan / Feb 2011, Vol 31, No1

White Randy (2014): The Challenges of Developing Entertainment Projects in Africa

Yin Robert K, (2014): Case Study Research –Design and Methods, Sage Publications, 2014

Girish Kelkar

Girish Kelkar is a Senior Management professional with 45 years of experience in management of high technology companies including several software technology companies. Initially he worked as a senior professional for Business and Engineering Applications in India and travelled across the world to set up various international operations. He has directed software development projects in India, Nigeria, UK and USA. He has multi-faceted experience and has worked with many MNCs and Indian Organizations (Alfa Laval AB Sweden, Satt-Control AB Sweden, Onward Technology Group India, Magic Software Enterprises Inc Israel (India and Nigeria), ALS Group Detroit USA, Core Objects Inc. USA, Jopasana Software and Systems Ltd. India, cMAT Software Group India and PXIL India. Girish has received many awards during his career for his outstanding contributions to the professional activities in many prestigious projects. 

Girish holds BE-(Mech.) University of Pune & PGDIE (NITIE). He is a member of numerous professional organizations including Computer Society of India (CSI) & Mensa International /PIC. Girish was the President of PMI Pune Deccan India Chapter (International Award winning chapter for 2007). He is currently actively pursuing his Fellowship Program at NITIE Mumbai in Project management.

Girish is associated with Project Management Institute of USA, one of the largest professional organizations over the last 10 years and has received Component leadership award for his achievements during 2009-10.