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Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51

Contemporary Issues in Business, Management and Education 2013

Managing for volatility on technology projects: A conceptual model

Dirk Jakobus Janse van Rensburga, Leon Pretoriusa*
a
PhD student, Graduate School of Technology Management, University of Pretoria, Lynwood road, Pretoria 0028, South Africa

Abstract

The purpose of this paper is to create an information technology industry management view and formulation of new theory via
exploratory research to understand the impact of volatility and suitable resilience response of project portfolio management in a
technology environment. The research includes a quantitative and qualitative study on a significant research sample of
information technology professionals in information technology. This approach created the base for the hypotheses testing and
formulation of new theory comprising the conceptual model. Some survey test results to initially confirm some aspects of the
model are discussed. Future research may include risk reducing management practices that are prevalent in executing information
technology projects as well as being able to withstand via resiliency management, factors influencing the project management
approach such as exogenous volatility.

©
© 2014
2014 The
The Authors.
Authors. Published
Published by
by Elsevier
Elsevier Ltd.
Ltd. Open access under CC BY-NC-ND license.
Selection
Selection and
and peer-review
peer-review under
under responsibility of the
responsibility of the Contemporary
Contemporary Issues
Issues in
in Business,
Business, Management
Management and
and Education
Education conference.
conference.

Keywords: volatility; impact; project; management; resilliency; technology.

1. Introduction

During late 2007 to 2010 deteriorating economic conditions had a major global financial impact on trade and
industry including the information technology industry. The information technology industry in 2013 is still
experiencing a cautious investment from business due to continued uncertainty in economic conditions (Business
Monitor International, 2011). This lack of investment may have an impact on new projects being initiated and
product development slowing down including:

*Corresponding author. Tel.: +27836251756; fax: +27123625307.

E-mail address: leon.pretorius@up.ac.za

1877-0428 © 2014 The Authors. Published by Elsevier Ltd. Open access under CC BY-NC-ND license.
Selection and peer-review under responsibility of the Contemporary Issues in Business, Management and Education conference.
doi:10.1016/j.sbspro.2013.12.846
 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51 41

• Reduced expenditure in the Information Technology industry (Business Monitor International, 2011).
• Higher inflation during 2009–2010 and interest rates slowing down as a result of weaker global growth which
resulted in a decline in demand for South Africa’s exports from foreign nations (Donehoe, 2009).
• Reduced availability of credit due to inability or unwillingness of financial institutions to provide funding for
projects/new product development (NPD) and illiquidity in short term funding (Kana, 2009).
• The reduced ability of debtors to pay accounts at due dates and creditors pushing for quicker payment; this
impacts organizational cash flow of information technology (IT) companies as well (Kana, 2009).

As there are periods of downturn so there are periods of sustained growth such as South Africa has experienced
with yearly GDP growth in 2005 to 2007 reaching above 5% growth per year. This is indicative of a good
performance in trade, high foreign direct investment, high consumption (its citizens are able to spend and acquire
goods) and high government spending on technological advancement, labour development and infrastructure. The
demand for IT products and services may potentially stimulate innovation.
In reviewing the ability of businesses to sustain and grow operations, thereby creating value for shareholders,
factors like economic and trade conditions can influence the way businesses make decisions on IT expenditure
(Gibson, 2008). Many businesses have however learned to work with factors requiring organisational change, adapt
strategy and adapt their operational execution of business. They have learned a sense of resiliency to be able to
operate amidst these changes and retain focus towards longer term business and technology strategy goals.
It is suggested that these factors lead to problems in project portfolio management and product development in
the following context:

• IT clients in the formal corporate sector are also in the same business environment as IT companies and they
experience the same shocks as a result of volatility. They change their short and long term business strategies as
well as requirements for IT systems, products and services.
• The IT business adapts its business strategy to process the changing economic and trade conditions. Although
businesses attempt to understand their industry and technology products they can potentially not have sufficient
detection mechanisms for volatile conditions and respond too late with too little!
• When business strategy changes, it impacts the project and product portfolio selection. Changes in the output of
new technology product conceptualisation, design, development, production and delivery processes will be
required in response to changes in project/production portfolio selection. The changed project/product portfolio
must be done whilst business operations are being executed. Thus businesses need to change strategy and still
get current technology products delivered to clients. The transitional change state requires detail planning for
internal process changes and remains risky.
• In high technology product/project environments products may already be ordered before they exist. The
information technology business orders will be impacted by changing economic conditions and this means the
business needs to adapt their resource allocation and utilisation. Balancing the product/project order book with
the limited organisational resources is a constant risk and challenge for businesses.

This research needs to review mechanisms businesses use to balance the order book and technology
project/product delivery schedule in light of increasing changes in economic conditions.

2. Literature review

The classic work of Knight (1921/1964) proposed theory defining uncertainty as a situation where several
possible outcomes are associated with an event, but the assignment of probabilities to the outcomes are not possible.
Risk in contrast permits the assignment of probabilities to the different outcomes. Aizeman & Pinto (2005)
formulated theory that economic volatility is more than being the study of business cycles and the composition of
economic growth in cyclical and trend components. Aizeman & Pinto (2005) postulated that volatility is allied to
risk in that it provides a measure of the variation or movement of a particular variable for example economic
variables or some function of the variable. Aizeman & Pinto (2005) formulated the model framework in Figure 2 to
build theory for explaining the effect of different types of shocks and impact of volatility:
42 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51

• Exogenous volatility derives from sources of volatility that are outside of control of both households and policy
makers in the short term.
• Endogenous volatility derives from sources of volatility that include unstable macro policies, political
instability, and to some extent financial crisis brought about or amplified by domestic market imperfections.

A business responds to exogenous volatility, endogenous volatility and subsequent changes in economic variables
with risk management mechanisms which require either absorbing the shocks or adapt the business in response to the
shock in Fig. 1.

Fig. 1. Identified Sources of volatility and impact (Aizeman & Pinto, 2005)

Previous researches by Gaving & Hausmann (1996) build the theory that shock may impact economic variables
like exchange rates, interest rates and other asset prices. In practice however Dedee & Vorhies (1998) argue that
when a downturn arrives, business executives rush to make across the-board cuts in everything from research and
development spending to employee headcounts. When signs of recovery appear, businesses turn on the spending to
rebuild their strategic orientation. Although these approaches seem reasonable, they can damage long-term
competitive positions and corporate performance. Thus business risk needs to be managed as a result of volatility.
Grant (2003) builds a theory that indicates uncertainty requires that strategy focus less on specific actions and more
on establishing a clear direction, within which short term flexibility can be reconciled with the overall coordination
of strategic decisions. This duality requires that long term strategic goals are established and that the firm commit to
them through strategic intent and growing of competencies (Hamel & Prahalad, 1989). The question arises to what
extent can endogenous and exogenous shocks be absorbed via longer term focused product innovation and
development strategy yet retain room short term flexibility from decision making – be resilient?
Similarly “Resiliency Management” embodies both a proactive and reactive approach to face unprecedented,
unexpected and unforeseen events that influence the organizational operational activities. Executives and managers
need to ensure that the underpinning values, beliefs, norms and expectation that give rise to a culture of resiliency
are woven into the day to day interaction and extensive dialog (Weeks, 2009).
 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51 43

“Pattern-based strategy” is the discipline to enable business leaders to actively seek, amplify, examine and exploit
new or novel business patterns. To support pattern-based strategy, organizations must begin to understand in which
activities they are investing, and how these investments need to be changed or adjusted to enable them to exploit
new patterns within their own businesses. They must also be able to understand new patterns of signals coming from
external sources that indicate a business opportunity or threat. Chief executive officers and strategy officers need to
expand their investment analysis beyond the two investment categories (defined and creative) (Burton, Austin &
Genovese, 2009).
Both theories of Resiliency Management and Pattern based management suggest that an organization requires
mechanisms to be aware of the upcoming market events and take corrective action in advance to the net effects of
such market trends. These corrective actions could include optimisation of product development and delivery of
new products to clients as a result of focused project portfolio management.
From a technology management perspective the selection of a project/product portfolio supporting the strategic
direction with resulting research and product development builds long term competencies in the business. The
project product portfolio management decisions may be impacted by the resulting effects of the sources volatility.
Consideration must be given to the goals of project and product portfolio management. Cooper & Edgett (2001)
indicates five goals of project and product portfolio management:
• Maximise the value of the portfolio via selecting new product projects so as to maximise sum of the values or
commercial worth of all active projects supporting a business objective.
• Seek balance in the portfolio in parameters of short vs. long term projects, high vs. low risk, markets,
technologies, product categories, project types.
• The portfolio must be strategically aligned and spending across projects areas, markets etc. must mirror
strategic objectives.
• Pick the right number of projects with limited resources available.
• Ensure the revenue (or profit) goals set out in the product innovation strategy are achievable given the projects
currently underway.
From the goals listed, it can be concluded that businesses have limited resources for product development and
need to align organisational resources including product and portfolio optimally to ensure maximum business value.
This goal must still be achieved while trade conditions continuously change as a result of volatility.
Whether volatility impacts the pressure for reduced time and cost in product development is unclear (needs to be
tested via hypothesis) but the market still requires a product at acceptable quality. The business builds development
capability as a result of new product development and this may improve business performance.
Critical factors were investigated in this research that drive product innovation and development at business unit
level (Cooper & Kleinschmidt, 2007). The 9 factors which distinguished better performing business are as follows:
• A high quality new product process.
• A defined new product strategy for the business unit.
• Adequate resources of people and money.
• Research and development spending for new product development.
• High quality new product project teams.
• Senior management committed to and involved in new products.
• An innovative climate and culture.
• The use of cross functional project teams.
• Senior management accountability for new product results.
Le (2004) concluded that typically 3 factors affect the quality of the new product performance and highlights the
impact of the project portfolio management on the new product performance as a result of successful product
development as can be seen in Fig. 2:
The corner stones of new product performance according to Le (2004) include:
• The project screen process refers to the discipline of ensuring projects are executed in accordance with
expected quality requirements.
44 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51

• The portfolio management process ensures the business prioritizes projects in such a way as to ensure that new
product development resources capability is not exceeded. Over utilisation of new product development
resources capability can lead to the fire fighting syndrome according to Nelson, Conclaves, & Black (cited in Le
(2004)).
• The new product strategy ensures that the long term developments receive strategic direction and align with the
business’s objectives.

Fig. 2. Corner stones of new product performance

The impact of volatility on the corner stones of new product performance needs to be investigated. This must be
linked to the research done by Cooper & Edgett (2006). Cooper & Edgett (2006) have published extensive theory
and best practice on the project screen process, portfolio management and new product strategy. The best practices
derived from their research identified several aspects which can aid in improving the project portfolio management
process and resulting new product development. These include:
• Focussing on data integrity: The best project selection is worthless unless data used for project selection are
sound.
• Install a systematic idea-to-launch process to identify key tasks should be undertaken at every stage of the
project and what information is really needed at each selection gate.
• Adopt an incremental commitment or options based approach. Limit risk by taking small investment steps
before committing fully for the project execution.
• Know when to walk away. The correct kill can also be a success since money is saved and trouble is limited.
• Categorise your developments projects into buckets to identify differences such as
o New products.
o Platform and technology developments.
o Improvements, modifications and extensions.
o Customer requests.
• Utilise multiple selection methods in combination to hone in on the correct project selection decision.
• Utilise score cards to rate and rank projects: The development funnel is a method proposed by Wheelwright
and Clark (1992), to select between different product development proposals. Proposed products are reviewed
to see which fit the business strategy best. Products of lesser fit are eliminated earlier in the product selection
process. Successful product development results in products that can be produced and sold profitably.
• Utilise success criteria at every stage in the project selection process to evaluate if projects meet agreed criteria
for success and agreed expectations.
• Utilise the right financial approach to select projects including, net present value (NPV), sales-to-cost ratio,
and probability adjusted NPV and productivity index.
• Build periodic portfolio reviews to rank projects ensuring that business has
o The correct set of projects in execution.
 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51 45

o The right mix of projects.

o The right balance of projects.
o The right priorities of projects and
o Sufficient resources to undertake approved projects.
When reviewing the factors impacting the right project selection as listed by Cooper & Edgett (2006), the impact
of volatility on these factors must be investigated further as there is a theoretical gap. The impact of volatile
conditions on data integrity used for decision making, the killing of project and new product development decisions,
types of product categories, financial analysis for break even and profit in limited time, the correct set of
projects/products, the mix of projects vs. products and sufficient resources must be investigated. Some of these
issues are addressed in the ensuing sections, of this paper the first being the research methodology focussed on
exploratory and theory building research. The question is: How do IT related organisations become resilient in
detecting, processing and working with volatility?

3. Research Methodology

3.1. Research method

The research method comprised the following logic:

Research Design: The planned research has scientific value as well as practical value for business.
Linkage to Theory: The study combines both exploratory research and theory building research to derive new
theories models and methods.
Type of study: Elements of hypothesis generating and exploratory research types are present in the research.
Data acquisition techniques used: Data was primarily collected from survey questionnaires with structured and
unstructured commentary feedback from respondents.
Data analysis techniques used: Data classification and analysis techniques:
• Ordinal/Nominal and Likert scale data.
• Graphical data analysis (Univariate Analysis)
• Measures of centre and spread
• Bivariate analysis, association tests and research Hypothesis testing
• Tests for significance : Chi-squared tests

3.2. The research problem

A total of 4 research sub problems were identified and translated to research questions whilst addressing the
mechanisms businesses use to balance the order book and technology project/product delivery schedule in light of
increasing changes in economic conditions. The problems identified translate into a logical flow of a conceptual
model as depicted in Fig. 3.
The identified sub problems indicated in Figure 3 are:
• The market demanding new technology and subsequent client responses to volatility require clients to
change their adoption/procurement of technology during negative periods.
• The IT business adapts its business strategy to adopt for the changing economic and trade conditions.
Although businesses attempt to understand their industry and technology products they can potentially not
have sufficient detection mechanisms for volatile conditions and respond too late with too little!
• When business strategy changes it impacts the project and product portfolio selection. Changes in the
output of new product conceptualisation, design, development, production and delivery processes will be
required in response to changes in project/production portfolio selection. The changed project/product
portfolio must be done whilst business operations are being executed. Thus businesses need to change and
still get current products to clients. The transitional change state requires detail planning for internal
process changes and remains risky.
• In high technology product/project environments products may already be ordered before they exist. The IT
business orders will be impacted by changing economic conditions and this means the business needs to
46 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51

adapt their resource allocation and utilisation. Balancing the product/project order book with the limited
organisational resources is a constant risk for businesses.

Fig. 3. Interaction conceptual model of research problems

3.3. The research questions and hypotheses

The research problem depicted in the conceptual model of Fig. 3 was translated to research questions and with a
research hypothesis being formulated for each question in Table I. The relationships between the research
hypothesis and research question are depicted in Table I:

Table 1: Relationship between research questions and hypotheses

HYPOTHESIS RESEARCH QUESTION RESEARCH HYPOTHESIS
NUMBER
A How do IT clients respond during periods of trade volatility with H1: There is a negative association between
the adoption/procurement of new technology? new technology adoption/procurement and
periods of exogenous volatility in the
business environment.
B What impact does the resulting client response have as a result of H1: The 3 elements of a clear understanding
volatility shock on IT business project portfolio and new product of
development? customer requirements,
customer operational impact as a result
volatility as well as
one on one customer interaction activities
has a positive association on IT business IT
projects and supporting product
development growth.

C How do businesses adapt their IT project with resulting product H1: New high technology product
portfolio selection and still maintain product delivery to clients development selection is more dependent
during volatile conditions? on correct project portfolio selection during
periods of volatility.
D How do IT businesses balance the order and delivery books H1: IT businesses balance their order intake
during periods of volatility? with ability to deliver more focused work
during periods of volatility than in stable
periods of trade.
 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51 47

4. Results and discussion

4.1. The research population and sample

The research population included both consumers and creators of IT products/systems but having several years of
experience in the IT industry. From a consumer focus perspective the research population needs to interact with IT
product, project and services providers to create product demand for the IT industry. A smaller group of seven
respondents was requested to complete the first release of the research questionnaire developed. This proved helpful
to make the questions understandable for the target audience, ensure the research variables as used in the hypothesis
support the research questions adequately, create a first level data analysis review to see if the answers make “sense”
as well as addressing security concerns for personal data of respondents.
A questionnaire of 13 structured questions (5 options each) with 13 commentary unstructured fields was
compiled and after review published in several stages using Survey. The questions addressed the dependent,
independent variables as well as the hypothesis itself as a whole. During the period February 2013 until end of June
2013 a total of 1165 knowledgeable IT professionals were approached either by direct email or via “LinkedIn”
commercial service to participate in the research. The structured as well as commentary (unstructured) fields
provided sufficient room for feedback as required by the respondents. The responses received were also analysed
using the Altas.ti® qualitative data analysis tool to obtain a view on the industry representation of the respondents.
Since the questionnaire was supplied to suppliers / producers and consumers of IT a diverse supplier industry
representation was expected with potentially more suppliers of IT projects / products. A total of 115 respondent
answer sheets eventually qualified with an almost even split between IT supplier and IT client/consumers. The
balance provided for a reasonable representative view on the questionnaire answers between IT supplier industry
(57/115) and consumer industries (58/115). The executive who makes up 55 of the 115 respondents formulates the
project and product portfolio decisions in response to the business environment.
Ensuring that the respondent selection and resulting questionnaire responses can be applied in the industry in
general if it was to be retested, was a key focus of the study to ensure integrity in the results obtained. The research
must be repeatable and leading to a similar unbiased process result list if executed again.

4.2. The quantitative results

The quantitative results pertaining to volatility issues in IT related businesses following the conceptual model in
Figure 3 were mainly obtained using Chi-squared tests for significance:

Hypothesis A:

IT clients experience volatility as a result of interest rates, commodity process skills shortage in their business
environment which impacts their business in the longer term on a high impact level. IT clients adopt/procure
somewhat less IT projects/products during negative conducive volatile periods. IT clients adopt/procure somewhat
more IT projects/products during positive conducive volatile periods.
The association analysis between independent and dependent variable indicated a negative association between
the variables during negative volatility.
In the case of negative volatility, the Null hypothesis H0 is rejected and research hypothesis H1 is significant
(Chi-square sum = 24.78696462, df = 9, p<0.05).
The association analysis between independent and dependent variable indicated a positive association between
the variables during negative volatility.
In the case of positive volatility, the Null hypothesis H0 is rejected and research hypothesis H1 is not significant
(Chi-square sum = 11.64207431, df = 12, p>0.05).

Hypothesis B:

Having a clearer understanding of IT client requirements has a high impact on assisting in growing the project
48 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51

portfolio and supporting product development. Having a clearer understanding of the impact volatility has on client
operations have a high impact on assisting in growing the project portfolio and supporting product development.
Having one on one interaction with clients has a high impact on growing the IT project and supporting product
development during periods of volatility. IT client response during volatility has a high impact on IT project and
supporting product development. The respondents indicated strong agreement as to the positive impact of the
independent variables (customer requirements, understanding customer operational impact as result of volatility as
well as one on one customer interaction activities) on the dependent variable (IT business IT projects and supporting
product development growth).
The association analysis between independent and dependent variable indicated a positive association between
the variables. The Null Hypothesis H0 is rejected and the research Hypothesis H1 is significant. There are three
independent each having being tested with the dependent variable:
(Chi-square sum = 37.54347188, df = 12, p<0.05)
(Chi-square sum = 42.60763069, df = 12, p<0.05)
(Chi-square sum = 21.44486032, df = 9, p<0.05).

Hypothesis C:

The selection of sellable products to be developed by IT business is of higher importance during volatile periods.
The selection of projects for the IT business as offered by clients to execute is of higher importance during volatile
periods than non-volatile periods. IT businesses have mature processes in place for planning what organisational
capacity (people, infrastructure, financial resources) is required to execute projects. The formulation of the right
product portfolio in support of potential projects to clients is more critical during periods of volatility than in periods
of less volatility.
The association analysis between independent and dependent variable indicated a strong positive association
between the variables.
The Null Hypothesis H0 is rejected and the research Hypothesis H1 is significant
(Chi-square sum = 36.98701919, df = 16, p<0.05).

Hypothesis D:

There is high to very high importance for IT businesses to increase focus on their order book as a result of
volatility. There is medium to high importance for IT business to increase focus on delivery of projects successfully
as a result of volatility. IT businesses balance their order intake with ability to deliver focused work during periods
of volatility more than in stable periods of trade.
The association analysis between independent and dependent variable indicated a positive association between
the variables.
The Null Hypothesis H0 is rejected and the research Hypothesis H1 is significant.
(Chi-square sum = 51.20687157, df = 16, p<0.05).

4.3. The qualitative results

The qualitative data analysis provided realistic feedback on why questions were rated with answers the way they
were. The descriptive level information provides direct support for the quantitative answer and also new ideas on
how the function should operate vs. currently operating. Key words and concepts were identified, counted and
grouped into families. These were analysed using semantic and topology networks to understand a causal base for
the relationship and association between dependent and independent variables in the quantitative data questions.

Hypothesis A:

In the case of negative volatility clients procure somewhat less IT as volatility increases. According to the
qualitative data new market required technologies require IT clients to adopt /procure new technology to remain
 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51 49

efficient in the delivery of their products and services. Budgets are reduced and clients later play catch-up during
improved economic conditions. Value for IT investment (money) becomes more critical. During positive volatility
clients do tend to adopt slightly more IT technology. The relationship is not of negative association however as more
positive volatility does not restrict funding and IT investments improve leading to more procurement of IT. IT
clients are more inclined to take risk during positive volatile periods leading to high amounts of procurement of IT
projects/products. From a business management perspective, investment in IT projects/products must still be value
based and satisfy the requirements of the business case in question.

Hypothesis B:

According to the quantitative analysis IT client response during volatility has a high impact on IT project and
supporting product development. The qualitative data indicated that clients focus on optimizing their business
processes and this leads to interfacing with potential IT suppliers of projects and products. As clients are impacted
by the volatility shocks they are looking for avenues to reduce IT maintenance/overhead costs and create the IT
product that can ensure growth. A customer centric IT business will attempt to understand the impact of the
volatility on the customer and create products to assist the customer via project deliveries.

Hypothesis C:

According quantitative data, the selection of sellable products to be developed by IT business is of higher
importance during volatile periods. The dominant aspect listed by the respondents in the qualitative data analysis is
that IT business must have a diversified product portfolio with lower unit cost, mature and sellable products also
available to be sold off the shelf to customers. Not all products must be “in progress, but not yet available”
development status. Many changes to products as a result of project change due to volatile conditions inhibit the
ability to create a diversified product portfolio.

Hypothesis D:

According to quantitative data analysis, IT businesses balance their order intake with ability to deliver focused
work during periods of volatility more than in stable periods of trade. According to the qualitative data South
African IT related Companies have an attitude of taking up all possible orders, and then quickly adapt capacity
(resources, personnel and infrastructure) to fulfil execution to balance the order book or lose some projects later as a
result of client cut backs. The attitude of first get the business then worry about execution or volatility is acceptable!
Since there are often budget constraints during volatile periods, more standardized less expensive projects are
realized which use standardized products. Many companies non sales management, realize that an order for a
project does require the ability to deliver on the order quicker during volatile periods. In this area there is risk as the
visibility of order intake vs. fulfilment lacks in project personnel teams. Capacity planning during volatile periods
has to be clear on the impact of volatility on order book as well as the delivery book (project/product deliveries) to
ensure the full value chain can be stabilized. This is done more successfully in large business.

5. Conclusion

The IT related business’s ability to anticipate and respond to changes induced by volatility that can impede it to
generate earnings, will define the level of robustness and resiliency of the business. As indicated in the findings of
the study the IT related business needs to be aware of the market it operates in, know its products, how these
products can be deployed in projects, know its clients, competition and how it will secure business. When volatile
conditions arise the business must be able to have sufficient skill, resources and willingness to change to work with
the volatility. The business must adjust its business and technology strategy to be able to capitalise on opportunities,
realise and implement trends as well as consume threats to retain focus on its core goals and vision. In summary
initial research results presented in this paper indicated mostly acceptance for the hypotheses generating the
conceptual model pertaining to IT related organisations becoming more resilient in detecting, processing and
working with volatility
50 Dirk Jakobus Janse van Rensburg and Leon Pretorius / Procedia - Social and Behavioral Sciences 110 (2014) 40 – 51

From a practical view point, the business and technology management in the business need to be open minded to:
• Be witness to changes, willing to adjust strategy and realise that change is part of normal business.
• Be constantly aware of competition that is also reviewing, responding and interfering in the market place
with existing and new customers.
• Have a short and longer term focus with the future viewed as an opportunity and provide channels of
communication with employees who can provide worthwhile input into the future business strategy of the
company.
• The business strategy focus towards realising sales orders from customers is the starting point of business.
Ensure that sufficient resources are focussed on collaboratively realising orders. During volatile periods
having sufficient sales orders ensures sufficient resources to continue project and product portfolio
development.
• Be practical and realistic in executing these orders with sufficient resources (people, time, funding and
infrastructure) to ensure quickest possible delivery to customers during volatile periods. Prioritise focus on
specific deliveries on a weekly basis and address customer unique requirements without losing project and
product portfolio focus.
Managing the effect of volatility effectively and efficiently in project and product development should extend
beyond best practises and also become part of the organisation culture to organisation to overcome negative
volatility and capitalise on opportunities created as a result of volatility.
The statement from theory: “Recession teaches businesses to be prepared even during the good times, because a
recession is like a battle- When you are in it, it is almost too late start training for it; if you are no prepared for it,
you will pay for it!” (Navarro, 2009) need not be a threat or warning but rather an opportunity to have a “can do”
attitude, an aptitude to become resilient yet flexible to achieve focus on the fulfilment of the goals in business
strategy and technology management.

Acknowledgements

The research support of the University of Pretoria and the National Research Foundation (NRF) in South Africa
is herewith gratefully acknowledged.

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