Managing the Operating Environment of Projects in Developing Countries

Any project’s operating environment will have an impact on project management decisions and actions even in relatively stable environments. Whereas projects in developed countries are moderately sensitive to the operating environment, those in developing countries are highly sensitive to their environment. This issue is so mainly due to the varied, and in some cases, changing, nature of environmental factors of projects such as cultural, economic, political, social, physical, aesthetic, financial, legal, institutional, technological, and policy. It is a situation that presents a challenge for project management in developing countries. Failure to properly manage the unstable operating environment of projects is arguably the chief cause of the less-than-optimum project outcomes often recorded in developing countries. This chapter systematically examines the project operating environment in the context of developing countries. It highlights the significant differences and similarities in operating environments in developed and developing countries. The chapter advocates for workable approaches for the context of developing countries by discussing aspects of the project environment, suggesting ways in which it may be influenced to increase the probability of a successful outcome, and highlighting ways in which what is proposed for developing countries differs from what pertains in developed countries. Some recommendations for future research in this field of knowledge related to developing countries are presented.