In the Shadows of Time: A Case Study of Flexibility Behaviors in an Interorganizational Project

Introduction

The theoretical background described below builds on the literature on adaptive organizations (Dessein & Santos, 2006; Levchuk, Levchuk, Meirina, Pattipati, & Kleinman, 2004; Morel & Ramanujam, 1999). This literature, which is based in complex and open systems theory, deals with the design of organizational structures in uncertain or complex environments, when task characteristics are not fully known in advance or task specifications alter due to unexpected changes. Organizational structures are labeled “adaptive” organizations if they provide their members with flexibility to tailor their tasks to local information (Dessein & Santos, 2006).

Operational flexibility

Flexibility is a multi-dimensional concept (Dryer & Grönhaug, 2004; Schwab & Miner, 2011; Sethi & Sethi, 1990) used in a variety of contexts such as economics, psychology, and management. The interest in this paper is specifically in flexibility in an (inter)organizational context. Organizational flexibility is an organization’s ability to change its behavior in response to environmental changes (Teece, Pisano, & Shuen, 1997; Volberda, 1996; Young-Ybarra & Wiersema, 1999). Several authors have made a distinction between different types of organizational flexibility. Volberda (1998) proposes a typology consisting of strategic, structural, and operational flexibility. Strategic flexibility involves organizations’ ability to change goals and long-term plans in order to maintain competitive advantage (Hitt, Keats, & DeMarie, 1998). Structural flexibility concerns the ability to change organizational structures and processes, in our context for example by changing partners during the formation and execution of IO projects (Schwab & Miner, 2011). Operational flexibility, finally, is about the ability of organizations to implement (behavioral) change within existing structures and processes. It has to do with the ease with which organizations can change day-to-day operations, and can be both quantitative and qualitative in nature (Harris, Giunipero, & Hult, 1998). Quantitative operational flexibility involves for example an organization’s ability to quickly increase the number of production personnel in order to make up for delays on a project, whereas qualitative operational flexibility involves for example an organization’s ability to make changes in the sequencing of activities, or to reallocate resources to different tasks (Atkinson, 1984; Harris et al., 1998; Volberda, 1996).

We adopt the typology of Volberda (1996, 1998) as this helps us to clarify our focus on operational flexibility within an IO project. Before the start of such a project, lead organizations create interorganizational structures by selecting partner organizations who, in their eyes, best meet the project demands. Following Volberda’s typology this is a clear example of structural flexibility. As a project evolves, participating organizations face among others the challenge of aligning their tasks and dealing with changing work circumstances (Sydow & Staber, 2002). These changing circumstances may pertain among other things to project delays, customer requirements, incomplete plans, and partner requests (Heide & Miner, 1992; Sydow & Staber, 2002). They require flexibility at the operational level, defined here as an organization’s ability to adjust day-to-day practices in response to changed work circumstances (Atkinson, 1984; Harris et al., 1998; Heide & Miner, 1992; Volberda, 1996). We build on the ideas developed by Volberda, Sydow and others, and apply these on the level of the project.

In the next section we consider how this operational flexibility may be influenced by the temporariness and temporal embeddedness of interorganizational projects.

Temporariness, temporal embeddedness, and operational flexibility

One of the central and unique characteristics of IO projects is their relationship with time (Janowicz-Panjaitan et al., 2009; Jones & Lichtenstein, 2008). IO projects are temporary because they have a clear starting point and an ex ante defined termination point which is known to all project participants (Bakker & Janowicz-Panjaitan, 2009; Lundin & Söderholm, 1995). IO project activities take place in between and are likely to be influenced by these temporal limits (Raab, Soeters, van Fenema, & de Waard, 2009; Sydow & Staber, 2002). From the moment an interorganizational project starts, time is limited. On the one hand, this may result in a sense of urgency and, consequently, an emphasis on increased operational flexibility in later stages of a project in order to get tasks finished on time (Atkinson, 1999; Bakker & Janowicz-Panjaitan, 2009; Conte, Landy, & Mathieu, 1995; Jones & Lichtenstein, 2008; Saunders & Ahuja, 2006). On the other hand, the limited duration of IO projects can create pressures on IO project participants to obtain their own objectives first (Nordqvist, Hovmark, & Zika-Viktorsson, 2004) and can induce participants to display “end-game behavior” (Selten & Stoecker, 1986). End-game behavior involves IO project participants focusing more strongly on their self-interests when the end of the project is approaching. In the context of operational flexibility this behavior would involve for example becoming more inflexible in order to avoid incurring additional costs when complying with flexibility requests from other IO project participants. The effect of temporariness on operational flexibility thus can be reasoned to be both positive and negative.

Despite their temporariness IO projects may be, and in reality often are, executed by project participants who share a history of collaboration and/or expect to collaborate in the future, after the current project ends (Dyer & Chu, 2003; Granovetter, 1985; Jones & Lichtenstein, 2008). These relationships constitute what have been called latent networks: “forms of organization that bind together configurations of key actors in ongoing relationships that become active/manifest as and when new projects demand” (Starkey, Barnatt, & Tempest, 2000, p. 299). Consequently, collaboration may take on a more permanent character, beyond the temporality of individual IO projects, because a focal project is temporally embedded in a latent network. Hence two other time frames next to the (limited) time left until project termination become relevant for project participants and thus for operational flexibility: the time before project initiation and the time after project completion.

In the time before project initiation, current project participants may already have worked together. This prior collaboration creates a so-called shadow of the past (Blumberg, 2001; Grabher, 2002; Poppo, Zhou, & Ryu, 2008). A (positive) shadow of the past can have several benefits: familiarity can increase trust and improve communication between project participants, and it paves the way for the development of standardized practices and routines for collaboration, all of which increase project performance (Elfenbein & Zenger, 2014; Katz, 1982). The experience-based trust (Kramer, 1999) developed through interactions in previous projects is important for operational flexibility because, as mentioned in the Introduction, being flexible implies a sacrifice of self-interest. Such a sacrifice is more likely to be made if a focal party in an IO project is confident that the other parties will do the same, if necessary (Uzzi, 1996). Hence, a shadow of the past, to the extent that it has led to relations of mutual trust, is beneficial for operational flexibility, at least as long as routines have not become too inert.

However, a shadow of the past can also decrease project performance (Hoang & Rothaermel, 2005), for instance when participants were unsatisfied with the past performance of their partners and want to “return the favor.” Based on these arguments, the conditional effect of prior collaboration between project participants on their operational flexibility can be both positive and negative.

The effect of the time after project termination on current IO project behavior may be expected to show a similar pattern. On the one hand, if current IO project participants expect future collaboration with each other to depend on their behavior in the current project, this shadow of the future will increase participants’ willingness to make short-term sacrifices, e.g., by responding positively to partner requests for flexibility, in order to realize long-term benefits (Bercovitz, Jap, & Nickerson, 2006; Klein Woolthuis, Hillebrand, & Nooteboom, 2005). We associate this willingness to make sacrifices in the form of operational flexibility behaviors with the notion of calculus-based trust (Lewicki & Bunker, 1996). Behavior based on calculus-based trust is guided by trade-offs between costs and benefits (Rousseau, Sitkin, Burt, & Camerer, 1998). The trade-off in the case of operational flexibility in an IO project is between the costs and benefits of behaving flexibly in the present project and those of participating in future IO projects with the same (lead) participant(s). If IO project participants do not expect to collaborate with each other in the future, the absence of a shadow of the future may trigger forms of opportunistic behavior in the current project.

On the other hand, if IO project participants expect to be selected for upcoming projects or to work together in the future anyhow—that is, regardless of their present behavior—they may be less inclined to put in their best effort in the current project. In this case, despite the presence of a shadow of the future, project participants may be unwilling to make sacrifices and thus become more likely to show inflexible behavior.

Based on the discussion above we can state that the effects of IO projects’ temporariness and temporal embeddedness on operational flexibility remain ambiguous and conditional (see Bakker, 2010). Therefore, we deem further empirical examination is necessary.

Research context

Our research was conducted in the Dutch shipbuilding industry. Ships are technically complex products. This is especially true for the Dutch shipbuilding industry, which in order to stay ahead of foreign competition focuses on the building of technically complex vessels that are difficult to copy by producers in low-wage countries. These vessels consist of many advanced subsystems and components that need to be integrated. Such complex, high value products are known as CoPS (Hobday, 2000). Building these vessels engenders a high level of organizational complexity. Seventy years ago shipyards used to perform all the work in-house, but important parts of the production process have been externalized over the past decades (Levering, Ligthart, Noorderhaven, & Oerlemans, 2013). Shipyards nowadays no longer have the capacity and knowledge to build complex vessels on their own. Instead they hire, on a temporary basis, specialized subcontractors, thereby organizing production in the form of interorganizational projects.

On the executive or managerial level, shipyards and subcontractors structure their working relationships by formal contracts in which tasks, rights, and responsibilities are written down. On the operational level participants rely among other things on planning instruments to coordinate interorganizational actions. But initial plans often (a) are incomplete because it is, given the complexity of the task at hand, impossible to foresee and write down every future aspect of work; or (b) turn out to be infeasible due to unforeseen contingencies in combination with the technical and organizational complexity of building ships. When initial plans no longer suffice, project participants are called upon to be flexible with regard to these plans to make sure the vessel is delivered on time. The importance of operational flexibility in shipbuilding makes this industry a suitable research context. For this study we investigated the building of a complex, special-purpose vessel in the Netherlands.

Characteristics of the IO project under study

The IO project under study was initiated for the construction of a yacht-like vessel, which we for confidentiality reasons will call ZeroOne from here on. The hull of ZeroOne, fabricated in Vietnam, arrived in the Netherlands in the autumn of 2011, and was delivered to the end customer at the end of the summer of 2012. ZeroOne was a so-called one-off: the shipyard had not produced a similar type of vessel before, nor a vessel of this size. Consequently, the shipyard needed to obtain expertise from various subcontractors, including subcontractors with whom they had not collaborated before. In addition, ZeroOne participants were often called upon to be flexible due to the newness of ZeroOne, changing customer preferences during ZeroOne construction, the high level of interdependence between participants, and the impossibility and impracticality of specifying all tasks and activities beforehand. The high level of interdependence between ZeroOne participants meant that a delay in the job of one participant could seriously affect the work of others. One shipyard, eight subcontractors, and over one hundred suppliers were involved in the ZeroOne project. Our focus here is on the collaboration between the shipyard and the subcontractors (who execute various specialized tasks on board, compared to the suppliers who “merely” deliver materials and components).

As is usual in shipbuilding, as the starting date approached, participating organizations began staffing the project with their employees. From the shipyard’s perspective, this meant selecting engineers for calculation and drawings, selecting a project manager who acted as the overall coordinator, and selecting staff to carry out the actual work on the vessel, including a production manager to supervise the staff. Furthermore, the shipyard picked the subcontractors to perform parts of the work. The interorganizational relations and exchanges were initially structured by means of formal contracts. On ZeroOne these formal contracts came in the form of largely standardized documents that specified what a subcontractor would be delivering and against what price. Subcontractors, once they had been selected for the vessel, appointed a project manager who mainly dealt with financial control. They also selected a production manager to supervise the staff carrying out the work on board ZeroOne. Depending on their role, subcontractors sometimes also carried out engineering tasks. These individual managers and employees who acted as boundary spanners between the organizations involved in the project were our informants, even if sometimes a flexibility request or response originated from higher managerial levels in their organizations. Figure 1 displays a simplified visualization of the project organization of ZeroOne. Note that to keep the figure simple only two subcontractors are displayed, while in fact eight subcontractors were involved.

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Figure 1.

Simplified visualization of the project organization of ZeroOne.

Research design

Our limited knowledge of operational flexibility within IO projects, and how this is influenced by temporariness and temporal embeddedness, calls for an explorative, longitudinal, and in-depth analysis, which we undertake via a qualitative single-case study design (Yin, 2003). Such a design is particularly well suited when little is known about the dynamics of the phenomenon of interest, and aids in building theory (Eisenhardt, 1989), in our case theory on operational flexibility and time within IO projects. Based on our literature review, we specified the central constructs in our study, to help us shape the initial design and to aid us in interpreting the data (Eisenhardt, 1989). We focused on requests for operational flexibility (interorganizational partner requests concerning operational issues), responses to these requests (the way and the extent to which partners comply with each other’s requests) and the drivers behind these responses, with a specific focus on the impact of time. Rather than presenting a priori conjectures regarding the relationships between these three sets of concepts, we aim to contribute through induction to the development of a theory on operational flexibility and time in IO projects based on our empirical exploration (see Eisenhardt, 1989). The ZeroOne case was considered a revelatory case that could provide us with the best insights into the phenomenon we wanted to explore due to the uniqueness, complexity, and length of the project and the large number of subcontractors involved (Glaser & Strauss, 1967; Pettigrew, 1990; Yin, 2003).

Data collection

Following Eisenhardt (1989) our empirical evidence results from the analyses of data collected using a combination of methods, specifically semi-structured interviews and observations, which we triangulated to provide stronger substantiation of constructs and relations (see Figure 2).

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Figure 2.

Data collection overview.

The data collection process started with observations of ZeroOne participants’ behavior in weekly project meetings, which had an average length of 75 minutes. During these meetings, shipyard personnel (typically the project manager, the assistant project manager, the production supervisor, and the lead engineer) and subcontractor personnel (typically the production supervisor of each subcontractor) came together to discuss operational issues. Because the project meetings focused solely on operational issues, they were considered highly appropriate settings for observing operational flexibility requests and responses to these requests. We assume that the responses to requests given during the project meetings were reflecting actual practice on board. Important arrangements were written down in meeting minutes, which were distributed to the participants afterwards. To capture the findings of our observations, we used an observation protocol. The protocol was divided into two columns. In the left column we wrote down what we actually observed, and in the right column we wrote down—both during the project meetings and afterwards—our interpretations of these observations, using more theoretical concepts. This procedure allowed us to show how we arrived at more generalized theoretical claims on how flexibility plays out within this specific temporary interorganizational project. In total 22 project meetings were attended during the period October 2011 to June 2012. This period covers the production phase of the vessel. The production of the hull (before this period) and the commissioning of the vessel (after this period) are not covered by observations. However, the interviews do provide information on collaboration and operational flexibility during these phases.

After the first project meetings, observations were used to design and adjust an interview protocol. In this way we could improve the questions in terms of reflecting participants’ experiences (see Harris & Sutton, 1986). Interviews were held with nearly all the project meeting participants, who we considered the ideal informants because of their daily engagement with operational issues. The semi-structured interviews contained questions on, among other things, the types of requests made and received by participants, responses to these requests, and drivers behind these responses. A focus on requests and responses was considered useful as during our early observations it became evident that decisions on changing operational practices were often the result of negotiations among the parties involved. We also discussed other interorganizational collaboration practices, either based on earlier observations during project meetings, or indicated by the interviewee as being important aspects of the collaboration process. This additional information enabled us to critically evaluate our findings on operational flexibility and to place the findings in their context. Next to the interviews with these—mainly operational-level—participants, we conducted interviews with the project managers of the various subcontractors. These project managers seldom attended the project meetings but from the earlier interviews they appeared to have some influence on flexibility at the operational level. We further conducted interviews with some other informants, for example the shipyard’s purchasing manager. These individuals were included because their importance in terms of their influence on and experience with operational flexibility became clear during the data collection. In total 29 interviews were held between November 2011 and October 2012. These interviews were recorded and transcribed verbatim. Finally, we gathered background information by means of personal notes during site visits, informal conversations with project participants, and by means of presentations and discussions during external meetings with shipbuilding executives and consultants.

Data analysis

Data analysis followed an iterative process in which data collection and data analysis frequently overlapped and influenced each other (see Eisenhardt, 1989; Glaser & Strauss, 1967). The data obtained from both the interviews and observations were analysed using “the Gioia method” (e.g., Corley & Gioia, 2004), meaning that the analysis started with open coding. Open coding uses first-order codes, i.e., language used by the respondents or—in the absence thereof—a simple descriptive phrase (van Maanen, 1979). We then searched for linkages between these codes (axial coding), which enabled us to assemble them into second-order themes. Finally, similar themes were gathered into overarching dimensions. While constructing the so-called first-order concepts, second-order themes, and aggregate dimensions, we continuously compared the emergent constructs and relations between them with the data (see Strauss & Corbin, 1990). This enabled us to come up with valid theoretical contributions which were closely linked to the data (Eisenhardt, 1989). To avoid potential researcher perception bias, interpretation of the information obtained from the observations and interviews resulted through discussion among the authors. These interpretations in turn were presented to the project partners (i.e., the project meeting participants and the interviewees), as well as to shipbuilding executives from other shipyards and subcontractors, and consultants, and were regarded by them to be realistic.

To present the results in a systematic manner we make use of data structures (see Corley & Gioia, 2004). The data structures provide an upfront general overview of our central findings and show how the data items have been coded and linked to each other. To give an example of our coding process, consider the following quotes:

“It happens regularly that we have set up our cables in a certain area of the ship, and that the subcontractor for heating and ventilation comes in that area and asks us to remove the cables so that he can place his pipes there.” Production supervisor Electrician (Interview, November 2011)

“It is important that everybody cleans his working area once a task is finished. We have a guy walking on board who takes care of general cleaning, but I need everyone to make sure the vessel looks neat.” Project manager Shipyard (Project meeting, November 2011)

The “asking for removal of cables” can, similar to phrases like “repairing damaged work”, and “upgrading entertainment systems,” be labeled as requests concerning scope of work. Respondents’ remarks about requests for “keeping the working area clean” can, similar to phrases like “informing others before proceeding,” be labeled as requests concerning general procedures. Requests concerning scope of work and requests concerning procedures in turn can be combined into types of flexibility requests. This inductive analysis provides part of the answer to what operational flexibility is, namely, a process of making requests to other parties concerning scope of work and general procedures.

The reliability of the presented results heavily depends on how candid the respondents were. Especially from a subcontractor’s point of view, fear of putting themselves in a bad light vis-a-vis the shipyard could induce answers that are socially desirable. We have tried to overcome this by emphasizing the anonymity of answers given and by focusing not only on self-proclaimed drivers but also on “attributed” drivers, i.e., why participants think other parties behave in a flexible or inflexible manner. The credibility of the presented results is further secured by combining interview data with the observation of actual behavior of participants during project meetings.

Operational flexibility on ZeroOne

Responses to flexibility requests

From the interviews and observations, we derive four types of responses to flexibility requests during the project. The requested party (a) carried out the request without additional payment, (b) carried out the request under the condition of financial compensation, (c) refused the request and openly communicated this to the requestor, or (d) did not carry out the request and concealed this from the requestor. We label these responses acquiescence, compromise, defiance, and avoidance respectively (following the general terminology introduced by Lui & Ngo, 2005; see Figure 3).

We consider acquiescence and compromise to be flexible responses as in both cases participants comply with the request. The difference between the two responses is that in the latter case requested parties bill the requestor for the additional labour-hours or materials needed to carry out the request, or at least intend to do so. In contrast with acquiescence and compromise, we consider defiance and avoidance inflexible responses because in these cases requests are not carried out. The difference between these two responses is whether the non-compliance is openly communicated to the party making the request (defiance) or not (avoidance). In the latter case, requested parties conceal their non-cooperation and try to reduce their contact with the requestor regarding the issue at hand.

Data supporting our interpretations of flexibility responses can be found in Table 1. This table shows quotes of ZeroOne participants (first-order concepts), whether the quotes stem from interviews or observations during the project meetings, and how they have been grouped into second-order themes.

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Table 1.

Data supporting interpretations of responses to flexibility requests.

Theme	Representative flexibility request quotes
Acquiescence	“Sometimes it is about just pulling one extra cable. Then of course I do it, and we do not charge them for it.” Production supervisor Navigational Equipment (Interview, November 2011)
	“If something simple is damaged, we repair it without further consequences.” Production supervisor Painting Exterior (Interview, November 2011)
	“This flexibility is who we are, how our people work. We are flexible not only towards this shipyard, but towards everyone we work with.” Project manager Isolation (Interview, March 2012)
Compromise	“If they have damaged our work, or we are asked to do additional work that differs from what was on the original drawings, then I take a note of that. I write down our additional hours and materials and that goes to the office.” Production supervisor Isolation (Interview, November 2011)
	“That is going to weigh in for the budget.” Production supervisor Navigational Equipment (Interview, November 2011)
Defiance	“Not every subcontractor is able to increase pace to the extent we wish for.” Project manager Shipyard (Interview, October 2012)
	“I ask them for a list which says which cables I need to pull. If I need to sort that out by myself, it costs me more than a day’s work. While they are sitting behind their desk and with a few mouse clicks they can generate such a list. But they just won’t do that.” Production supervisor Electrician (Interview, November 2011)
	“It happens that I cannot respond positively to information requests. Then I tell them I am sorry.” Production supervisor Electrician (Interview, November 2011)
Avoidance	“At the beginning of the project, we decided that every Thursday afternoon everyone would help clean up the mess on board. Currently this is not going to my satisfaction. Therefore I would like to request again to make sure that you leave the vessel only when you are finished cleaning the room where you have been working.” Project manager Shipyard (Project meeting, December 2011)
	“I have heard that there are people sandpapering the wheelhouse without covering entries. That is just totally unacceptable.” Project manager Shipyard (Project meeting, March 2012)

Notwithstanding the presence of inflexibility characterized by defiance and avoidance, the behavior of ZeroOne participants in general can be characterized as flexible. The following quote by the shipyard’s project manager illustrates this:

“Generally speaking, collaboration goes very well. Highly important in that respect are the problem-solving capabilities of all the parties working on board. During the project meetings, issues are discussed for which multiple opinions are required, or for which quick solutions are not possible. But the majority of the issues are dealt with on board, and that smoothens the process. You see that when everyone walks in for the project meeting, they are busy making arrangements, and they continue to do so when they go back to their jobs.” Project manager Shipyard (Interview, April 2012)

The quote also illustrates that most of the flexibility requests (and, consequently, responses) occurred outside of the project meetings. During the project meetings flexibility requests were observed as well, and the responses were predominantly positive (acquiescence), strengthening the idea that the behavior of ZeroOne participants can be classified as flexible. Inflexible behavior occurred predominantly with regard to general procedures. Issues concerning cleaning on board, the protection of finished work, and safety regulations were brought up by the shipyard’s project manager almost weekly, and addressed to all the parties attending the project meetings. The response to this type of request can be labeled as avoiding, since non-compliance was not openly communicated to the shipyard. Compared to avoidance, defiance was observed less frequently. The following quote illustrates open denial of a request:

“I know you want those cables to be painted today, but that is not going to happen. I hope we can accomplish that in the next few days. I also know you are troubled by the small containers that are now in that area, but I have no other open space where I can put them.” Production supervisor Shipyard talking to Production supervisor Carpenter (Project meeting, March 2012)

This quote also illustrates that the distinction between flexibility and inflexibility is not in every occasion straightforward. The cables will be painted, and the small containers will be moved, but not at the time requested by the subcontractor.

To sum up, this section shows that operational flexibility in this interorganizational project is mainly a process of making requests and responding to them, including subsequent actions. Operational flexibility here is portrayed as a multi-dimensional concept: different types of requests can be distinguished (scope of work, pace and timing of activities, information, and general procedures) as well as different categories of response (acquiescence, compromise, defiance, avoidance).

Drivers of operational flexibility on ZeroOne

Our literature review suggests that the temporariness and temporal embeddedness of IO projects (shadows of the past and future) influence operational flexibility in IO projects. First, the temporariness of IO projects was argued to potentially have both positive and negative effects on operational flexibility. Our analysis confirms the positive viewpoint. For example, ZeroOne participants considered flexibility necessary in order to complete the building process on time. This sense of urgency created an atmosphere in which problems were solved without unnecessary delays by quickly taking up small issues, by moving to another part of the ship to carry out work, or by providing each other timely with sufficient information:

“It is in our own interest, in the interest of the shipyard, that the subcontractors can do their jobs without any delays. So, yes, we are prone to fulfill their requests.” Production supervisor Shipyard (Interview, November 2011)

“You always have to be flexible. When you are rigid it can be that later on during the project this person hesitates to ask you something again. And that in turn can lead to major hold-ups.” Project manager Electrician (Interview, March 2012)

Our analysis confirms the possibility of a negative effect as well. Experienced time pressure was considered by ZeroOne participants to be a logical explanation why sometimes requests were not met. Time limitations led to inflexibility when participants judged that they did not have enough time to adequately respond to requests.

Second, it was argued that shadows of the past can have both a positive and a negative influence on operational flexibility. Our analysis confirmed both perspectives. For example, most of the parties on ZeroOne shared a history of collaboration. Individual-level relations between the shipyard and most of the subcontractors (Interior painter, Heating & Ventilation, Electrician, Piping) had existed in some instances for more than 10 years, and organizational-level relations for even up to 50 years. ZeroOne participants confirmed that during these previous collaborations trusting relationships between the parties had developed, which increased the willingness to help each other out.

However, past collaboration did not necessarily result in flexible behavior. This past collaboration had to have been experienced as pleasant or beneficial, because negative prior experiences were more likely to generate operational inflexibility:

“Then he comes to me and says he is going to start on that deck with that number of people, and he is going to do this and he is going to do that. But then I can only smile because I know it’s not going to happen. That is the experience I have with him. The consequence is that when he asks me to do something for him, I give it lower priority than when the request comes from another subcontractor.” Production supervisor Shipyard (Interview, November 2011)

Third, it was expected that shadows of the future can have both a positive and a negative influence on operational flexibility. Our analysis confirms only the positive effect. ZeroOne participants, and especially the subcontractors, indicated that being flexible was almost obligatory in order to keep the shipyard satisfied. Subcontractors believed that inflexibility would result in the shipyard selecting other organizations to do their work in future projects. This belief was present among both subcontractors who had and who had not collaborated with the shipyard in previous projects. Flexibility thus was considered a precondition for selection on subsequent projects. For that same reason, the shipyard expected their subcontractors to behave flexibly. In addition, the shipyard had the tendency to continuously select for the execution of their projects partners from the same set of subcontractors. Thus, as far as partner selection is concerned the shipyard had a long-term orientation. These expectations of future interaction gave the collaboration between shipyard and subcontractors a more permanent character. This made it less likely that participants displayed end-game behavior, i.e., self-interested behavior when, and because, the end of the project was approaching:

“If we were to behave rigidly, the shipyard would soon kick us out.” Production supervisor Painting Interior (Interview, November 2011)

“We try to work with a stable set of subcontractors. It works easier when you know one another, you know what you can expect from everyone and you can anticipate their behavior in advance.” Project manager Shipyard (Interview, October 2012)

The first quote suggests that the position of the organization—being a lead organization or not—also had an influence on operational flexibility in that requests from the shipyard are likely to be met by the subcontractors. Still, however, not all shipyard requests were carried out by the subcontractors, indicating that other factors need to be taken into account as well.

Next to the expected factors based on our literature review, we found slack in project tasks to be an important factor as well. Slack in project tasks had a positive impact on operational flexibility, as resources were more easily freed up to take on urgent matters. For example, some of the subcontractors were working not only on this project but also on other projects at the same production site. This enabled them to quickly shift resources from one project to another if another party (usually the shipyard) asked for that. In contrast, in the absence of such slack ZeroOne participants felt forced to deny requests because they did not have personnel or time available at the time of the request:

“They have taken on too many projects. But they don’t have the capacity to work on all these projects. That is also in part our fault as we ask them to execute these projects while we know they have a capacity problem.” Production supervisor Shipyard (Interview, November 2011)

“The past few weeks working eight hours a day does not do the job. So I work twelve hours, and I also come back on Saturday morning. But yes, it is very busy, and consequently I cannot comply with all the requests I get. Then I have to tell them that I am sorry but that it has to wait.” Production supervisor Electrician (Interview, November 2011)

Summarizing, our findings point out that the temporariness and temporal embeddedness of ZeroOne had a significant influence on the operational flexibility behaviors displayed by its participants. Temporariness created a sense of urgency among ZeroOne participants which had a positive effect on operational flexibility. Shadows of the past—if positive—and shadows of the future increased the level of trust among ZeroOne participants, which in turn positively impacted on operational flexibility. Next to these time-related drivers of operational flexibility, slack in project tasks had a positive effect as well as it increased the availability of resources. We label trust, sense of urgency, and resource availability “flexibility enablers.” These flexibility enablers had a positive effect on operational flexibility, but this effect was weakened by a flexibility disabler, namely experienced time pressure, which in turn was caused by the temporariness of ZeroOne.

Contributions

This paper explores operational flexibility behaviors of participants in an interorganizational project, and investigates how these behaviors relate to the temporariness and temporal embeddedness of IO projects. We show that operational flexibility is a multi-dimensional construct, encompassing different types of flexibility requests and responses, and that it is influenced by the dimensions of time in various ways. Our findings advance knowledge of collaboration dynamics in temporary organizing by making three specific contributions to the literature on IO projects.

First, we propose that various time dimensions play a crucial role in explaining flexibility behaviors in IO projects. The temporariness that is an essential characteristic of IO projects has two potentially opposite effects on the behavior of its participants. On the one hand, temporariness creates a sense of urgency which induces participants to behave flexibly in order to meet project deadlines and goals (Bakker & Janowicz-Panjaitan, 2009). On the other hand, it leads to time pressure, which has a negative effect on flexibility (Nordqvist et al., 2004). We argue that the side to which the scale tips is influenced predominantly by shadows of past and future. A shadow of the past consisting of positive previous interactions increases flexibility because during previous interactions trust based in relational norms and routines has developed, which allows for flexible behaviors (Bechky, 2006; Kadefors, 1995). The effect of a shadow of the future, in contrast, rests more on calculus-based trust, where IO project participants behave in a flexible manner to increase the chance of being selected as a collaboration partner in future IO projects (Bó, 2005; Poppo, 2013). Shadows of the past and future thus can both have a positive effect on trust relations and hence operational flexibility (Laan, Voordijk, Noorderhaven, & Dewulf, 2012). The importance of these time shadows implies that proper consideration of the functioning of IO projects should take into account the time-related context in which IO projects operate: IO projects are not stand-alone phenomena (see Engwall, 2003; Grabher, 2002; Sydow & Staber, 2002). These ideas lead to the theoretical model depicted in Figure 5.

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Figure 5.

Factors influencing operational flexibility in IO projects.

In this model, we distinguish between flexibility drivers, i.e., fundamental characteristics of IO projects, the composition of participants and their pasts and expected futures, and their resources. These flexibility drivers impact on flexibility enablers, i.e., conditions in a given IO project that are conducive to operational flexibility, and flexibility disablers. In our study, we identified just one flexibility disabler: time pressure. This, however, may be expected to be a fundamental factor characterizing IO projects in general (Turner & Müller, 2003). Flexibility enablers make flexible outcomes more likely (acquiescence, compromise), while flexibility disablers lead to inflexible outcomes (defiance, avoidance). The model is deliberately kept rather general, given the state of development of theory regarding flexibility in IO projects. There are likely to be moderation effects, e.g., a shadow of the future may mitigate the negative effect of time pressure on flexibility. However, we have refrained from specifying these moderator relations. In addition, we think it is likely that the drivers we have identified have the largest effect on operational flexibility. Other factors may also play a role (such as the position of the organization, or the extent to which behavior—especially non-compliant behavior—can be observed by the requestor, or general reputation concerns), but our case suggests these factors are of minor importance.

Second, if we want to understand the relationship between temporary organizing and flexibility, a distinction between flexibility within and flexibility across IO projects is necessary. This basic insight, while straightforward, has not been clearly articulated in the literature on temporary organizing. IO projects are commended as ideal vehicles for flexible organizing (Bechky, 2006), but we posit that this is based on a singular focus on flexibility across IO projects. Indeed, the temporary involvement of multiple organizations allows for switching between partners when new IO projects are started (Hobday, 2000; Schwab & Miner, 2011), but this does not necessarily result in flexible actor behavior within an IO project. In fact, flexible organizing across IO projects in terms of constantly selecting new partners may cause inflexibility within IO projects because of a subsequent lack of shadows of past and future among participants.

Third, building on the previous point, we argue that in terms of flexibility, lead organizations in project-based industries face a trade-off: more flexibility across projects (by not sticking to the same partners) is likely to come at the expense of less flexibility within each project. If this trade-off is indeed germane to the situation of lead organizations in project-based industries, we should expect to find different strategies of such lead organizations in this respect, each with their specific advantages and disadvantages. For instance, successful collaboration with a stable set of partners is likely to increase operational flexibility, but if organizations search for the creation and transfer of new knowledge, and the employment of innovative activities, turning to organizations with whom they have not collaborated before may be a more fruitful option (Dodgson, 1993).

Limitations and future research

Our explorative, case-study approach has revealed important insights in an underexplored phenomenon. However, it has been argued, and we concur, that now the time has come to integrate the findings of in-depth studies on temporary interorganizational collaboration to see what we have learned so far and what remains to be explored (Bakker, 2010). Future research could incorporate large-scale, quantitative analysis. Such research can for example attempt to test the relative influences of temporariness and temporal embeddedness and their possible interaction effects. In addition, future research may also take the form of process studies or comparative case studies in order to come to a better understanding of the dynamics of operational flexibility in interorganizational projects (Langley, Smallman, Tsoukas, & Van de Ven, 2013).

This paper does not systematically examine the relation between the IO project and the parent organizations. On the one hand, parent organizations are part of the environment of the IO project and as such can have an impact on the functioning of IO projects (Modig, 2007). On the other hand, it is argued that IO projects can develop an endogenous logic of functioning that is different from established routines of parent organizations (Janowicz-Panjaitan et al., 2009). Future research may take a closer look at the interrelationship between IO projects and their parent organizations and how this impacts (flexibility) behaviors of IO project participants. Such research is also likely to identify additional factors influencing flexibility responses, and may identify more complicated interrelations (i.e., moderating relations) between some of the factors we have found to be of importance.