The matrix structure has become the primary organizational means for maintaining an efficient flow of resources in multi-project environments. Critics of the matrix, however, describe an inherent propensity for conflict among managers that substantially limits its effectiveness. Conflicts occur not only between the divergent interests of project and functional managers, but also among different project managers in a multi-project setting. A system dynamics simulation was developed for a such complex high-tech environment, a milieu with high uncertainty in meeting project deadlines and with intensive competition over “scarce” resources. Expected net benefits were calculated for each of the organizational groups under different work profiles. Findings from the simulation suggest that not all conflict is realistic. For some project objectives, higher organizational performance can be achieved when managers learn that they have no basic differences in real interests and they can agree upon a resource allocation policy.

This paper explores how the dynamic capabilities of firms may account for the emergence of differential firm performance within an industry. Synthesizing insights from both strategic and organizational theory, four performance-relevant attributes of dynamic capabilities are proposed: timing of dynamic capability deployment, imitation as part of the search for alternative resource configurations, cost of dynamic capability deployment, and learning to deploy dynamic capabilities. Theoretical propositions are developed suggesting how these attributes contribute to the emergence of differential firm performance. A formal model is presented in which dynamic capability is modeled as a set of routines guiding a firm’s evolutionary processes of change. Simulation of the model yields insights into the process of change through dynamic capability deployment, and permits refinement of the theoretical propositions. One of the interesting findings of this study is that even if dynamic capabilities are equifinal across firms, robust performance differences may arise across firms if the costs and timing of dynamic capability deployment differ across firms.

Despite the extensive use of simulation in management, the continuous simulation model for cost estimation remains unexploited, especially for construction engineering and management. This study introduces streamlining Monte Carlo simulation procedures with evaluation of stochastic processes and input probability distribution selection via hypothesis testing, and specification of correlations between simulated variates. By using self-developed algorithms and a spreadsheet-add-on program, this investigation uses historical construction projects as case study data to create an early-stage cost distribution for budget allocation. While establishing the applicability of the proposed simulation procedures, this study demonstrates that the simulated cost results present superior simulation accuracy in addition to separating the principal work items and unit price component model. Generally, the precision and absolute error rates fall into acceptable ranges when the proposed systematic simulation procedures are adopted. The cost simulation approach offers a simplified decision tool for fairly assessing construction cost and uncertainties based on the experienced judgment of project managers.