Success Factors of Project Management: The Critical Few

- An Empirical Investigation -
Prof. Dr. Hans Georg Gemuenden
Dr. Thomas Lechler
I. INTRODUCTION projects (about 1,800 successful, 1,200 unsuccessful and
- -
about 2760 unclassified projects). The basic structure of this
conceptual research frame differentiates between four classes
of variables: People, Activities, Barriers and Success.
During recent years, project management has been firmly
established as a concept for organizing extraordinary,
innovative as well as strategic endeavors. However, still
many of these projects fail. What are the recommendations
that research can provide to practicing managers?
The following contribution aims at providing general
recommendations regarding project management. This effort
is based on the assumption, that the project success depends
on a relatively small number of variables, the so-called
success factors. For the purpose of this study, success factors
of project management be defined after BOYNTON and ZMUD:
,,Critical success factors are those few things that must go
well to ensure success for a manager or an organization ... [or
a project]."l
11.THE CONCEPTUAL FRAMEWORK
In order to select the most relevant variables for testing, a
comprehensive review of the empirical research on success
factors of project management was conducted. This review
included 44 studies, which investigated a total of 5,760
Figure 1 : The conceptual research frame
People:
The factor top management includes direct support as
well as the general interest of the top management for an
individual project.
The factor project leader refers to the formal authority of
the project leader.
e The factor project team describes know-how and the
social skills of the project team.
Activities:
The factor participation refers to the involvement of the
project team in decision making.
e The factor information/communication describes the
formal information system as well as the effectiveness of
communication.
The factor planning/controlling focuses on effectiveness
of planning and controlling.
Information &
Communication
Boynton und Zmud (1984), p.17. Additions by the authors.
cf. Fritz (1 992)
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Barriers:
0
Success:
0
The factor conflicts pertains to both the intensity and the
kind of the conflict.
Changes of project goals refers to the extent, importance
and frequency of changes.
The determination of project success is a very complex and
multidimensional issue.The present study examines the total
impact of each individual success factor on overall projetct
success. For a detailed analysis of the factors influences on
the three sub-dimensions (effectiveness, efficiency, social
success) of project success cf. LECHLER .2
111.RESEARCH DESIGN AND DATA ANALYSIS
The data for this research was gathered through a
questionnaire which was distributed to the members of the
German Project Management Society (Gesellschaft fur
Projektmanagement (GPM)). After the initial contact by
telephone, two questionnaires3 were mailed out to each
respondent, asking them to report on one project they regard as
successful, and one project they regard as f ai l ~re.~ The data
collection effort achieved an overall response rate of 43%,
resulting in a sample of N=448 projects. The literature on
project management features only one study with a larger
ample.^The sample for the present investigation contains data
on 248 successful and 190 unsuccessful projects. These two
sub-groups are not entirely balanced because some respondents
were unwilling to report on an unsuccessful project or didnt
have any experiences in that regard.
The data analysis was conducted using the LISREL-
Approach (Linear Structural Relationships). using LISREL
version 7.13 .6
I v. EMPIRICAL RESULTS
The present model displays considerable explanatory power.
The eight success factors explain approximately 59% of the
variance in project success (r2=.59).
The individual success factors exert their influence on project
success in different ways, as will be explained below:
Top management directly promotes project success as
customer and highest organizational authority (yl = .24).
Through transferring formal authority to the project leader (yzl
.65) and by influencing the design of the project team ( ~ 3 1 =
.3 5), Top management provides the organizational environment
for the successful completion of the project. Top management
also impacts the process directly through the factor participation
* Gemuenden (1990); Hauschildt, (1991); Lechler (1997).
A part of the questionnaire was taken from the survey of Pinto (1
Cf.: Rothwell et al. (1974).
Baker, Murphy and Fisher (1974).
J oreskog, K.; Siirbom, D. (1989).
986).
(y4] =.47). The considerably high impact of top management on
project success can also be interpreted from a more critical point
of view, as it could indicate an overly strong involvement of top
management in the process of the project itself.
The project leader exerts influence over the factor
informatiodcommunication (P62 = .lo). The impact of the
project leader on planning/controlling, however, was not
supported by this data, so that this hypothesis has to be rejected.
Additionally, there was no significant direct influence of the
factor project leader on project success, so that this hypothesis
had to be rejected too.
The project team is the main driving force for project
operations and thus directly promotes project success ( PI 3 =
.36). A good team actively utilizes its decision making authority
(Pd3 =.33). Its know how leads to better planning and more
adequate and flexible controlling of the project (PS3 =.36) in
addition to improved information flows/communication within
and outside the team (P63 =.65).
This data does not display a significant relationship between
participation and project success, so that the hypothesized direct
impact is not supported. However, participations strong
influence on communication (P64 =.32) gives evidence to the
assumption that participative leadership enhances the formal
and informal exchange of information within the project.
Additionally, the project team participating in project relevant
decisions does improve on the quality of planning and
controlling (PS4 =.29).
Out of the group of activities, the factor
informatiodcommunication shows the strongest direct impact
on project success (Dl6 =.13). Its influence on planning and
controlling (p56 = .20) documents the importance of free
information flows on that success factor.
Surprisingly low is the direct impact of planningkontrolling
on project success ( PI 2 = .lo). This result contradicts the
widespread opinion that planninghontrolling is one of the most
important success factors. The relatively weak influence could
be attributed to high levels of uncertainty, that force the project
team to take ad hoc actions as reactions to ever changing
situations. In such cases, the need to react may outweigh the
benefits of the preset project plans. Another explanation for this
weak influence could be that the project team does not take the
plan seriously, in which case the plan would serve as an alibi.
The strong negative impact of conflicts on project success
demonsaates the significance of effective conflict
management to projects. Oftentimes the causes for conflicts
come from outside the project. For instance, differences
between project and line management over authority as well
as political activities are frequently being carried into the
project from outside. Conflicts are particularly likely to occur
in so-called week project organizations, where project
decisions have to be approved by numerous departments and
hierarchical levels. Additionally, projects in theses
organizations are more apt to experience high personnel
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Figure 2: Path diagram of the empirical model (Level of significance
I %)
y1 ,=. 19
turnover, which, in turn, may increase the chances for
changes in goals (another obstacle to project success).
The second barrier, changes in goals, also displays a
strong negative impact on project success. Because of
complexity and uncertainty, project goals are often difficult
to determine. However, our data documents that a lack of
continuity in goals is significantly related to unsuccessful
projects. Ow research also suggest, that the potentials for
conflicts and changes in goals are built up before project
start, and thus are hardly controllable during the course of the
project.
CONCLUSIONS AND OUTLOOK
Making use of LISREL, a structural model was developed
which explains 59% of the variance in project success while
taking into account causal effects among the eight success
factors. The demonstrated indirect effects underline the
importance of accounting for interrelationships in
determining the relative impact of the eight factors on project
success. Recognizing these structural issues, the analysis
shows all eight factors to be significantly related to project
success.
1.
2.
3.
8.
9.
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