Asia Pacic Business Review Vol. 16, No.

4, October 2010, 567589

Critical success factors in project management: implication from Vietnam

Cao Hao Thia and Fredric William Swierczekb*
a School of Industrial Management, HoChiMinh City University of Technology, Vietnam; bSchool of Management, Asian Institute of Technology, Thailand

This study will assess successful project performance based on key project factors. The indicators of project success are cost, time, technical performance and customer satisfaction as used in previous studies. The sample consisted of 239 project members and managers currently involved in infrastructure projects in Vietnam. Regression analysis was used to test ve hypotheses developed from theories on project success. Three groups of factors including manager competencies, member competencies and external stability have signicant positive relationships to the success criteria. The completion and implementation stages in the project life cycle are also positively related to success. The implementation stage of a project moderates both the effects of external stability and organization support on success. The implication for project managers is that implementation is the key stage in determining the success of projects. Keywords: implementation; project management; success factors; Vietnam

Introduction The professionalization of project management, for example, through the Project Management Institute (PMI), has developed uniform standards that for the most part ignore specic contexts. A recent search for success factors in the PMI database indicated only two sources for Asia. Both were the Global Conferences 2005 and 2004. While there were presentations specic to Asia, most were concentrated on best practices. An interesting example was in the Keynote address of the 2006 conference held in Bangkok on Leadership, where the speaker C. N. Chu adapted Sun Tsu to the leadership of projects. She focused on tao (path), kim (timing), ti (direction) and tsao (balanced leadership). The social cultural, political and economic context of a project is critical in understanding what is successful, particularly in developed countries, but it is largely ignored. Project managers frequently raise the issues of measuring and managing success and the factors which affect performance. Although it is widely agreed that the determination of critical success factors and their impacts on project results is important, the evidence from developing countries is limited. One major controversial issue is the denition of project success. Pinto and Slevin (1988) recognized that there are few topics in the eld of project management that are so frequently discussed and yet so rarely agreed upon as project success. Some researchers consider success factors as ubiquitous, something which affects all projects. Other scholars have tried to classify critical success factors in groups (Schultz et al. 1987, Belassi and Tukel 1996). In a counter position, Dvir et al. (1998)

*Corresponding author. Email: fredric@ait.ac.th

ISSN 1360-2381 print/ISSN 1743-792X online q 2010 Taylor & Francis DOI: 10.1080/13602380903322957 http://www.informaworld.com

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argued that success factors should not be universal to all projects. To dene success factors, a different approach is necessary to develop an improved framework that can include these widely diverging views.

Context Vietnam is attractive to Ofcial Development Assistance (ODA) and project assistance, with 25 bilateral donors and 15 international agencies. Approximately US$ 3 billion is available each year. Since 1996, the largest share of projects has been in major infrastructure. As of 2006, 6764 projects have been implemented worth US$ 28.7 billion. However this is only half of what was counted (US and Foreign Commercial Service 2007). The disbursement of ODA is painfully slow and aid effectiveness is limited (Jacquemin and Bainbridge 2005). Problems in completing projects on time and in budget come from vested interests who fear losing power to related project management units (PMUs) which have more benets and opportunities. Project performance is affected by the lack of transparency in bidding, too many regulations and limited enforcement of anticorruption measures. According to Transparency International (2006), Vietnam ranks 111 in perceived corruption. Currently, Vietnams economic situation has improved signicantly. As a result, there have been numerous capital investment projects implemented in Vietnam, especially in the eld of infrastructure development, such as the Asian Highway and Airport Upgrading in Hanoi and Ho Chi Minh City. Unfortunately, according to outside evaluations, the number of successful projects is limited (Jacquemin and Bainbridge 2005). How to enhance the success of projects has become an important task for many international agencies as well as professionals in Vietnam and throughout Asia. This study will consider key project factors as they relate to performance criteria. It assesses infrastructure projects in Vietnam to examine the relationship between these factors and the success of projects in a developing country. It will also consider the potential generalization of these ndings throughout the Asia Pacic region.

Literature review Project performance criteria Lim and Mohamed (1999) proposed a classication of project success. In the broad sense, a project is successful if it has achieved its objectives. Unfortunately, it is only possible to know whether the original project objectives were achieved during the operational phase of the project. This achievement depends on the users or stakeholders. As long as the users are satised, the project is considered successful. The more limited denition of project success considers specic project results. It usually refers to the conclusion of the project construction phase and the parties involved in the completion. Both denitions should be considered (Lim and Mohamed 1999). Two criteria are sufcient to determine project success: completion and stakeholder satisfaction; whereas, to determine the operational project success, the completion criterion alone is enough. Tukel and Rom (2001) reported the performance measures project managers commonly use to evaluate the success of their projects. Specically, they identied the project managers orientation toward using internal and customer-driven measures of performance. They also investigated the priority given to these measures at four different stages of a project (conceptual, development, implementation and completion stages) by

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identifying the primary objective at each of those stages. In general, they found that project managers primary success measure is quality and their most important objective is meeting customer needs. The priority given to this objective does not change during various stages of a project, regardless of the project type and industry classication. The choice of performance measures, however, is inuenced by project type and industry classication. The literature concentrates on the implementation stage of a project in which performance measures are primary and the customers requirements are secondary (Baker et al. 1988, Pinto and Covin 1989). The important factors in the early stages of a project are internal: meeting budgets; schedules; and technical performance. Yet, in more advanced phases of the project, external factors such as customer needs and satisfaction become more important (Pinto and Slevin 1988). Tukel and Rom (2001) recognized that although project managers claim that they are customer-focused, they commonly employ internal performance measures to monitor the progress of the project because internal measures are quantiable.

Theory Project success Project success has often been measured with a simplistic formula, perceived as unequivocal and easy to assess. Such measures have often dened success as meeting the objectives of the project budget and schedule and achieving an acceptable level of performance. The assessment of project success may also differ according to the evaluator. Comprehensive success criteria will reect different interests and views which lead to the necessity for a multi-dimensional, multi-criteria approach (Cooper and Kleinschmidt 1987, Pinto and Mantel 1990, Freeman and Beale 1992). From another perspective, Pinto and Mantel (1990) identied three aspects of project performance to use as benchmarks for measuring the success or failure of a project. These were the implementation process, the perceived value of the project and client satisfaction with the nal product. Paolini and Glaser (1977) and Pinto and Slevin (1988) added client satisfaction and customer welfare. Freeman and Beale (1992) identied seven specic criteria used to measure project success. Five of these are frequently used: technical performance; efciency of execution; customer satisfaction; personal growth; organizational ability; and business performance. A project can be considered to be successful by meeting the internal performance measures of cost, time and technical performance, but also insuring that the project is accepted by the customer (Kerzner 1998). According to Kerzner (2001), project success was dened as the completion of an activity within the constraints of cost, time and performance. This denition of project success has been modied to include completion: . . . . . . . . within the allocated time period; within budgeted cost; at the proper performance or specication level; with acceptance by the customer/user; when you can use the customers name as reference; with minimum or mutually agreed upon changes in scope; without disturbing the main work ow of the organization; without changing the corporate culture.

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Project performance in this paper will concentrate on four criteria: cost; time; technical performance; and customer satisfaction. Success will be determined by the level of performance achieved. Success factors usually described in the literature of project management are usually not based on actual performance. To determine whether these factors are actually successful depends on their effect on project performance. In this review, the term critical success factor is based on the denition of performance in the literature. PMBOK (Project Management Institute 2004) dened project performance baseline as an approved plan against which deviations are compared for management control. PMBOK also dened cost performance index as the cost efciency ratio of earned value to actual costs, and schedule performance index as the schedule efciency ratio of earned value accomplished against the planned value. Key project management factors The search for critical project factors has been continuing for more than three decades. Most early studies in this area focused on the reasons for project failure rather than project success. Rubin and Seeling (1967) investigated the relationship of the project managers experience on the projects success or failure. The ndings indicate that a project managers previous experience had a minimal impact on the projects performance (Abdul-Rahman et al. 2006). The size of the previously managed projects did not inuence the managers performance. Avots (1969) identied the reasons for project failure and concluded that the wrong choice of project manager, the unplanned projects termination and unsupportive top management were the main reasons for failure. Hughes (1986) conducted a survey to identify the factors that affect project performance. He concluded that projects fail because of the improper focus of the management system, by rewarding the wrong actions and the limited communication of goals. However, to understand failure does not guarantee success in the future. Replicating the critical success factors in new projects has been suggested as the more effective approach to improve project performance (Hawk 2006). Dvir et al. (1998) suggested that project success factors are not universal for all projects. Different types of projects are affected by different sets of success factors. Thus, a project-specic approach is appropriate for subsequent research into the practice and theory of project management (Hyvari 2005). Belassi and Tukel (1996) grouped critical success factors into four areas: external environment; project manager and team members; organization; and the project. The identication of critical factors would lead to the better evaluation of projects. Critical factors are linked to their effects which lead to project success or failure. The identication of this cause effect relationship would improve project performance (Karlsen et al. 2006). Schultz et al. (1987) classied critical success factors as strategic or tactical. Strategic factors consist of factors such as project mission, top management support and project scheduling, whereas tactical factors relate to client consultation and personnel selection and training. These two groups of factors affect project performance at different phases of implementation (Belout and Gauvreau 2004). Pinto and Slevin (1987) discovered ten critical success factors, including project mission, top management support, project schedule/plan, client consultation, personnel, technical tasks, client acceptance, monitoring and feedback, communication and trouble shooting. This research only identied the critical success factors, but did not measure the strength of their relationship with project performance. Morris and Hough (1987) and

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Cooke-Davies (2002) suggested a range of critical success factors relevant to performance, including project team and management competencies relevant to large, complex projects, but also to projects in general. Belout and Gauvreau (2004) constructed a model in which the relationship between the independent variables and project performance will be affected by the project life cycle, project structure and project sectors (intervening effect). The project life cycle consists of conceptualization, planning, execution and completion (Dvir et al. 2003). The types of project structure include functional, functional matrix, balanced matrix, project matrix and project team. The project sector is business or industrial. This framework is presented in Figure 1. In the model, the ten factors developed by Pinto and Slevin (1987) are dened as independent variables in order to assess the impact of these factors, especially the personnel factor. Project success is measured from three viewpoints: sponsors view; project managers view; and client or customers view. Success is dened as the level of satisfaction expressed by at least one of these three viewpoints (Freeman and Beale 1992). This would include specic evaluation criteria: technical performance; efciency of project execution; managerial and organizational implications; personal growth; project termination; technical innovativeness; business performance; and users satisfaction.

Project Life Cycles Independent Variables Project Mission Project schedule Client consultation Technical tasks Client acceptance Monitoring Communication Troubleshooting Management support Personnel Dependent Variable Project Success

Project Sectors

Project Structures

Figure 1. Hierarchical regression analysis of success criteria. Source: Belout and Gauvreau (2004).

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Yasin et al. (2000) recognized that signicant gaps exist between the existing body of knowledge and the practice of international project management in relation to variables that are relevant to construction project management success. Most previous studies consider that project success criteria should include cost, time, technical performance and customer satisfaction. This means the success of a project was dened as the completion of an activity within budgeted cost, within the allocated time period, at the proper technical performance and with acceptance of the customer (Hawk 2006). Many studies of project management have presented lists of critical success factors. The success factors were usually discussed as either general or specic factors that affected a particular project. Rather, it is the characteristics of a project which would determine the critical factors, and success is dened as a result. There is limited research on the strength of the relationship between the critical factors and success criteria. There is even less analysis of the causal effects between these factors and the performance of projects in Asia. Key project factors need to be determined as successful based on the level of performance accomplished in a variety of real projects. Hypotheses Based on the theories of success factors in the literature, ve specic hypotheses will be developed. The dependent variables are the four widely agreed project performance criteria: cost; time; technical performance; and customer satisfaction. These are used for evaluating the success of projects in this study. The four independent variables as developed by Belassi and Tukel (1996) are key project factors which might have an inuence on the project success. These are the external environment: the competencies of the project manager and the project team members. Factors related to the project will be treated as intervening variables because of how they inuence the process of project management. External environment This rst group consists of factors, external to the organization but which have an impact on project performance, either positively or negatively. A number of external environmental factors, such as political, economic, social, legal and those related to advances in technology or even factors related to nature, may affect project performance (Jin and Ling 2006). In their empirical study, Pinto and Slevin (1989) found that most of the environmental factors affect projects during the planning stage of a projects life cycle. However, some of the factors affect a project at all phrases of the life cycle, such as weather conditions or the social environment. Sometimes these factors are so inuential that they cause a project to be terminated at the implementation stage. Belassi and Tukel (1996) recognized that a client of a project can be from outside or inside the organization to which the project belongs. If a client is from outside the organization, the client should also be considered as an external factor inuencing the project performance. For functional projects, clients are usually part of the organization, such as top management. In such cases, a client is from inside the organization and factors related to the client can be grouped under the factors related to the organization. Additional external factors affecting project performance include competitors in the market and subcontractors. They should also be considered as factors related to the

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external environment. External factors inuence the availability of resources and project performance. The variability in the external environment factors will inuence the project planning and thus project performance (Soja 2006). For these reasons, stability is the main attribute of these factors that affects the project success criteria (Legris and Collerette 2006). Based on these considerations, the following hypothesis is proposed: Hypothesis 1: In a project, the more stable the external environment, the better the project performance.

Competencies of the project manager and team members In the literature, many factors related to the competencies of project managers and team members have been proposed for the successful completion of projects. These factors not only affect project performance but they also have an impact on client satisfaction and project acceptance (Procaccino and Verner 2006). Pinto and Slevin (1989) demonstrated the importance of selecting project managers who possess the necessary technical and administrative skills for successful project completion. The project managers competence becomes most critical during the planning and termination stages (Zwikael and Globerson 2006). The competence of the team members is also found to be a critical factor throughout the project cycle (Puthamont and Chareonngam 2007). Similarly, wellestablished communication channels between the project manager, the organization and the client are necessary for the acceptance of the project outcome by the client. Thamhain (2004) conducted a eld study to examine the inuences of the project environment on team performance and resulting project performance. He found a positive relationship between team involvement and performance especially in complex project environments. This discussion leads to specic hypotheses about the relationships between the project manager, team members competencies and project performance: Hypothesis 2: In a project, the higher the competencies of the project manager, the better the project performance. Hypothesis 3: In a project, the higher the competencies of the project team members, the better the project performance.

Organizational factors From the literature, the factors related to the organization include top management support, project organization structure, functional managers support and project champion. Tukel and Rom (1995) found that one of the most critical factors for the successful completion of projects is top management support. Support is usually strongest if there is a project champion and if this champion is from top management. Top management helps project managers understand and achieve the projects objectives, which are specied by the client and/or top management. Top management usually controls a project managers access to resources, which are supervised by functional managers. The level of support from top management usually determines the level of support provided the functional manager. Performance depends on the project organizational structure. For projects with a functional form, the availability of resources is not usually an obstacle, because the functional manager is usually also the project

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manager. But for projects with a pure project form, or with a matrix organizational form, adequate resources can be a difcult issue. It requires skilled negotiation and positional power within the organization. In that case, full support from the organization for the project helps to facilitate and implement strategies for the successful completion of projects (Zwikael and Globerson 2006). The following hypothesis is proposed: Hypothesis 4: In a project, the more support from the organization, the better the project performance.

Project characteristics In the literature, project characteristics have long been overlooked as being critical success factors. In one of the few studies available, Morris and Hough (1987) identied schedule duration and urgency as critical factors. However, many projects fail due to problems within projects. Belassi and Tukel (1996) specied the size and the value of a project, the uniqueness of project activities, the density of a project network, project life cycle and the urgency of the project outcome. Tukel and Rom (1995) found that many large projects (more than 100 activities) exceed their deadlines. There are usually penalties imposed on projects when deadlines are exceeded. The most common penalties are monetary and credibility loss. The project managers performance on the job can be heavily inuenced by the uniqueness of the activities. It is easier for project managers to plan, schedule and monitor their projects if a project has more standard tasks. Project density also inuences performance. Tukel and Rom (1995) dened project density as the ratio of total number of preceding actions to the total number of activities. The density will affect the allocation of resources, especially man hours. Because of resource constraints, project managers are often forced to use overtime, which exceeds the estimated budget, or they are forced to delay activities competing for the same resources, which results in delays in project completion. The urgency of a project relates to success. Pinto and Slevin (1989) dened urgency as the need to implement the project as soon as possible. In many cases, project performance criteria are not met because of the urgency of a project (Puthamont and Chareonngam 2007). Projects with political purposes are typical examples. In these situations, not enough time is allocated for planning and scheduling projects, and as a result they are more likely to exceed budgets and fail. Finally, two more characteristics of the project will be considered in the conceptual framework. These are the stages in project life cycle (concept, development, implementation and completion) and the type of project (Soja 2006). The priority given to the internal and customer-driven measures of performance at different stages of a project depends on the primary objective at each stage (Pinto and Slevin 1988, Tukel and Rom 2001). Tukel and Rom (2001) also identied that the choice of performance measures is inuenced by the project type and industry classication. This issue was also identied as very important in IT projects (Legris and Collerette 2006). From these considerations, the following hypothesis is proposed: Hypothesis 5: In a project, the strength of relationship between project factors and project performance will be signicantly inuenced by the characteristics of the project. The hypotheses are summarized in the conceptual framework shown in Figure 2.

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Project Characteristics Project target Project size Project value Financial control Budget authority Uniqueness of project activities Density of project Urgency Stage of project Type of project

575

H5 External Stability H1 + Manager Competencies H2 + Project Performance Team Member Competencies H3 + H4 + Organization Support

Figure 2. Conceptual framework.

Research methodology Operationalization and measurement This study examined the relationship between project factors and the successful performance of projects. The indicators of project success and its antecedent factors are measured by the perception of managers and professionals in infrastructure projects in Vietnam. The indicators of project performance are cost, time, technical performance and customer satisfaction as used in previous studies. The measurement of these concepts captures the extent to which a project has been successful. The indicators of project factors are mainly based on the four sets of factors developed by Belassi and Tukel (1996). These indicators are: the external environment; the project manager and team; the organization; and project characteristics. Additionally, the factors related to the project manager and team members were divided into two dimensions to capture the level of competencies of project manager and team members. The measurement of the external environment focuses on the level of stability, in terms of political, economical, social, legal and technological aspects, ecological (climate or weather) factors, client consultation, competitors and sub-contractors involvement. The competencies of a project manager are measured by the ability to delegate authority, to negotiate, to coordinate, to make decisions and to understand their role and responsibilities.

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The competencies of project team members are measured by technical background, communication skills, troubleshooting, commitment, problem-solving and teamwork. The measurement of the organization factors includes top management support, project organizational structure, functional manager support and project champion support. The factors related to the project measure the level of inuence of project characteristics. Project characteristics are divided into two groups of variables. The rst is the project situation. This consists of project goal, size and value, nancial control, budget authority of the project manager, uniqueness of project activities, density of project network and the urgency of the project outcome. Each of the items in the group was measured using a seven-point Likert scale ranging from 1 to 7. The second group, project background characteristics, includes ownership, number of activities, total budget, project form and stages of project. In the regression analysis, the situational characteristics are treated as independent variables and the background characteristics are treated as dummy variables. Research design and data collection There are four main phases of the study. The rst phase was conducted via literature review and interviews. The purpose of this phase was to assess the content and applicability of each measure based on the literature. Also, the interviews helped identify key indicators for the research. The second phase was a pilot survey to pre-test the measures developed for this study. The purpose of this pre-test was to provide a preliminary evaluation and renement of the measurement scales. It was conducted with 40 potential respondents, in charge of infrastructure projects in Ho Chi Minh City. Third, a survey was conducted with a sample of 239 project professionals in infrastructure projects in Vietnam. This was the main phase in the research design. Finally, a focus group was also conducted with project professionals in infrastructure projects in Ho Chi Minh City to discuss the results and implications. There were 21 participants in the focus group. This also served as a check on the results of the interview and the survey. The data received from each respondent in the survey consisted of the description of the project in terms of background information, perceptions about the projects performance and the project factors that inuenced the performance. The questionnaire required respondents to think of a project in which they were currently involved or had recently completed. This project was to be their frame of reference for completing the questionnaire. The questionnaire included 46 multiple-choice and open-ended questions. Each of the items about project performance criteria and project factors were measured on a scale ranging from 1 (strongly disagree) to 7 (strongly agree). In this research, the population is infrastructure projects in Vietnam. Based on the list of professionals who are in charge of infrastructure projects in Vietnam, 1000 questionnaires were sent to potential respondents through a nationwide mail survey. 239 usable questionnaires were returned, a response rate of approximately 24%. Bollen (1989) proposed an empirical ratio of at least ve observations per estimated parameter. In addition, it is generally agreed that the minimum sample for appropriate use of maximum likelihood is 100 (Hair et al. 1995). Based on the questionnaire, the estimated parameters are 46. The sample size required is about 230 (46 x 5). The sample size of 239 is adequate for this study. Missing data was minimal and related to background in formation of the project.

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The inability to secure responses from all elements of the population selected for a sample can produce a non-response bias (Churchill 1991). Specic analysis of the sample is required to determine whether the responses are representative. One method of doing this is the comparison of responses across and within the sample (Amstrong and Overton 1977). For this sample, non-response bias was estimated by comparing respondents from the survey and the pilot survey. A T-test was conducted to test differences between the means for each of the research variables in the survey and pilot survey. All p-values in the test statistics were greater than 5% except for the variable ability to coordinate (p 4.41%). The T-test results presented in Table 1 conrmed that the responses from the survey were not signicantly different from the pilot survey. This reduces the possibility of non-response bias in this study. Data analysis A frequency analysis is conducted for indicators related to the background information about the project. This information includes the position of respondents in the project, the type of project, ownership of the project, the number of project activities, total budget of the project, organizational structure of the project, stage of the project and work duration of project members. These background characteristics are presented in Table 2. Sixty-nine per cent of the projects were related to state-owned enterprises. Nearly half had budgets in the range of 500,000 to 5 million US dollars per project. Forty-four per cent were in the implementation stage and 22% were in completion. Most of the projects were in industrial plants or infrastructure (roads, etc.). The majority of projects had specic activities that ranged from 50 to 150 in number, which indicates they were of a medium to large scale. The dominant project structure was functional. The majority of projects also tended to be between 2 and 10 years in duration. These background criteria are representative of this type of project throughout Vietnam. They are predominantly public, medium-sized and in implementation or already completed. The means and standard deviations of the dependent variables (4 performance criteria) and independent variables (32 project characteristics) and the correlation coefcients between dependent variables and independent variables are presented in Table 3. The means range from 5.42 for technical performance to 4.04 for time. This represents satisfactory performance. The ndings from the descriptive analysis present some interesting patterns. The most important manager competencies are understanding the role and responsibilities of a project manager. Clearly, simply being in the position is not sufcient. The project manager through experience, training and development or from appropriate delegation, has to understand what is required in their role and the actions expected of them in their performance. The ability to make decisions and understanding trade-offs are related competencies which can affect the project managers performance. Members of project teams primarily need an appropriate and sufcient technical background, but they need to be able to apply this expertise exibly through problemsolving and troubleshooting. Specic characteristics of organizational support that were identied include the need for a project champion, top management support and an appropriate organizational form which tends to be functional. This level of support would improve the performance of the project. In terms of project environment, the political, economic and social environment has the most relevance for project success. For the project itself, the highest-rated factor is

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Table 1. Non-response bias assessment. Survey Response Size 233 234 235 231 239 239 238 198 237 237 224 221 222 234 231 235 237 238 237 238 239 239 239 239 236 233 234 235 238 236 5.13 5.13 4.69 4.66 4.76 5.28 5.53 5.69 5.70 5.65 5.50 5.15 5.33 5.38 5.50 5.33 5.53 5.31 5.25 5.98 6.53 5.18 1.38 1.17 1.14 1.78 1.50 1.38 1.01 0.98 1.24 0.92 1.15 1.12 1.31 1.05 0.93 1.05 1.09 1.10 1.06 1.12 0.78 1.41 2 0.895 2 0.821 0.660 0.071 2 0.471 2 1.031 2 1.358 2 2.023 2 1.024 2 0.845 2 1.034 2 0.974 2 1.171 2 0.899 2 1.182 2 1.169 2 1.046 2 0.751 2 0.889 2 1.063 2 1.088 0.392 4.89 4.04 5.42 5.32 5.99 5.24 5.24 4.98 4.86 4.88 4.88 4.69 4.59 4.94 5.18 5.11 5.38 5.42 5.28 4.96 5.03 5.15 5.25 5 5.15 5.09 4.94 5.7 6.37 5.33 1.26 1.63 1.04 1.12 1.23 1.18 1.21 1.47 1.32 1.36 1.32 1.53 1.44 1.39 1.26 1.34 1.37 1.31 1.11 1.06 1.21 1.25 1.14 1.32 1.51 1.34 1.48 1.26 0.95 1.51 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 5.05 4.33 5.68 5.67 6.15 5.65 5.30 1.22 1.65 1.00 1.20 0.98 1.03 1.14 2 0.594 2 0.636 2 1.421 2 1.595 2 0.653 2 1.783 2 0.244 Mean St. dev. Size Mean St. dev. T-stat Pilot Survey Response Testing Statistics p-value 55.29% 52.55% 15.65% 11.19% 51.45% 7.56% 80.77% 37.17% 41.24% 50.97% 94.36% 63.78% 30.36% 17.57% 4.41% 30.69% 39.90% 30.21% 33.11% 24.26% 36.95% 23.83% 24.34% 29.65% 45.32% 37.46% 28.87% 27.78% 69.54%

C.H. Thi and F.W. Swierczek

No

Variables

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Cost Time Technical performance Customer satisfaction Political environment Economic environment Social environment Legal environment* Technological environment Nature Client consultation Competitors Sub contractors Ability to delegate authority Ability to negotiate Ability to coordinate Ability to make decisions Perception of responsibility Technical background Communication skills Troubleshooting Commitment Problem solving Teamwork Top management support Org. structure support Functional managers support Project champion Target of project is clear The size of project is large

31 32 33 34 35 36 4.85 4.67 5.73

The value of project is high Financial control is strict* PM has budget authority* Project is unique Network of project is dense Urgency of outcome is high

235 198 196 233 221 233

5.03 5.54 4.63 4.35 4.6 5.46

1.53 1.39 1.78 2.00 1.40 1.35

40 40 40 40 40 40

5.18

1.43 1.95 1.46 1.04

2 0.382 2 0.736 2 0.205 2 0.919

70.31% 46.26% 83.76% 35.87%

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Note: *These variables were added in the survey.

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a clear target or goal. This is supported by the urgency of the outcome or result of the project and the project manager having sufcient budget authority to make decisions. These results are supportive of the ndings developed from the literature. They suggest the key role of the project manager, the capability and exibility of project members and the critical requirement of a clear goal with the involvement of a project champion. As shown in Table 3, these variables are all signicantly correlated with performance criteria.

Table 2. Background characteristics. Position President/Director Division/Department Supervisor/Staff Professional consultant Ownership of project State owner Private Joint venture/Foreign Others Total budget of project Less than 500,000 USD 500,000 to 1,000,000 USD 1,000,000 to 5,000,000 USD 5,000,000 to more than 10,000,000 USD Stage of project Conception/Development Implementation Termination Completed Type of Project Building Industrial plants Road Infrastructure Number of activities Less than 50 activities 50 100 activities 100 150 activities 150 more than 200 activities Organizational structure Project form Functional project Matrix project Work duration Less than 2 years 2 to 5 years 6 to 10 years 11 to 20 years 25.0% 32.0% 26.0% 14.0% 69.0% 10.9% 19.0% 0.8% 20.9% 23.4% 23.0% 32.0% 19.0% 44.4% 13.0% 21.8% 15.0% 28.0% 20.5% 30.0% 37.7% 28.5% 11.7% 14.0% 11.7% 55.2% 27.6% 17.2% 33.9% 28.0% 14.0%

Table 3. Descriptive statistics: factors and performance. Correlation Mean 4.89 4.04 5.42 5.32 1.000 0.377** 0.341** 1.000 0.635** 1.26 1.63 1.04 1.12 SD Cost Time Technical performance Customer satisfaction

1 2 3 4

Dependent variables Cost Time Technical performance Customer satisfaction 1.000 0.383** 0.468** 0.374**

1.000

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5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27

Independent variables Political environment Economical environment Social environment Legal environment Technological environment Nature Client consultation Competitors Sub-contractors Ability to delegate authority Ability to tradeoff Ability to coordinate Ability to make decisions Perception of his role and responsibility Technical background Communication skills Troubleshooting Commitment Problem solving Teamwork Top management support Project organizational structure Functional managers support 5.99 5.24 5.24 4.98 4.86 4.88 4.88 4.69 4.59 4.94 5.18 5.11 5.38 5.42 5.28 4.96 5.03 5.15 5.25 5.00 5.15 5.09 4.94 1.23 1.18 1.21 1.47 1.32 1.36 1.32 1.53 1.44 1.39 1.26 1.34 1.37 1.31 1.11 1.06 1.21 1.25 1.14 1.32 1.51 1.34 1.48 0.253** 0.343** 0.264** 0.208** 0.329** 0.163* 0.197** 0.171* 0.188** 0.248** 0.326** 0.277** 0.260** 0.255** 0.197** 0.244** 0.312** 0.258** 0.297** 0.289** 0.151* 0.184** 0.219** 0.156** 0.203** 0.213** 0.192** 0.224** 0.220** 0.255** 0.071 0.195** 0.359** 0.271** 0.408** 0.397** 0.333** 0.236** 0.248** 0.317** 0.330** 0.381** 0.351** 0.213** 0.251** 0.256** 0.241** 0.364** 0.328** 0.213** 0.324** 0.265** 0.195** 0.116 0.288** 0.382** 0.262** 0.323** 0.370** 0.306** 0.324** 0.279** 0.322** 0.385** 0.358** 0.288** 0.253** 0.370** 0.330**

0.200** 0.300** 0.305** 0.218** 0.208** 0.239** 0.417** 0.163* 0.221** 0.348** 0.301** 0.338** 0.332** 0.329** 0.245** 0.301** 0.275** 0.328** 0.330** 0.360** 0.202** 0.304** 0.278**

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Table 3 continued Correlation Mean 5.70 6.37 2.67 2.97 2.46 4.63 3.65 3.40 5.46 1.26 0.95 1.51 1.53 1.39 1.78 2.00 1.40 1.35 0.246** 0.299** 2 0.174** 2 0.091 2 0.336** 0.143* 2 0.118 2 0.099 0.269** 0.193** 0.139* 0.036 0.018 2 0.237** 0.384** 2 0.176** 2 0.160* 0.197** SD Cost Time Technical performance 0.321** 0.287** 2 0.146* 2 0.040 2 0.269** 0.213** 2 0.243** 2 0.187** 0.274** Customer satisfaction 0.294** 0.234** 2 0.053 0.054 2 0.306** 0.203** 2 0.264** 2 0.243** 0.258**

C.H. Thi and F.W. Swierczek

28 29 30 31 32 33 34 35 36

Project champion The target of project is clear The size of project is large The value of project is high The nancial control is strict The PM has full budget authority Project is unique Network of project is dense The urgency of project outcome is high

Notes: **Correlation is signicant at the 0.01 level (2 tailed); *Correlation is signicant at the 0.05 level (2 tailed).

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Table 4. Factor analysis of the key project factors. Factor 1: Member Competencies Problem solving Troubleshooting Commitment Technical background Teamwork Communication skills Ability to coordinate Ability to make decisions Ability to negotiate Ability to delegate authority Ability to perceive role and responsibility Functional managers support Project organizational structure support Top management support Project champion Social environment Political environment Economical environment Technological environment Nature The value of project is high The size of project is large Network of project is dense Project is unique Eigenvalues Variance explained (%) Cumulative variance explained (%) Cronbachs alpha KMO 0.906 .827 .798 .758 .727 .722 .667 .765 .752 .742 .715 .595 .753 .744 .734 .625 .815 .768 .746 .563 .440

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Factor 2: Factor 3: Factor 4: Factor 5: Manager Organization External Project Competencies Support Stability Situation

.439

9.264 38.60 38.60 0.9006

2.648 11.03 49.63 0.9092

1.577 6.57 56.20 0.8951

1.414 5.89 62.09 0.7628

.839 .756 .551 .502 1.164 4.85 66.94 0.6806

Notes: Rotation method Varimax with Kaiser normalization. Factor loadings less than 0.40 have been omitted.

Factor analysis of key project factors Factor analysis was used to reduce the 32 project characteristics into meaningful factors. Table 4 shows the results in which a ve-factors solution emerged. These are member competencies, manager competencies, organization support, external stability and project situation. The ve factors in Table 4, with the variables grouped under the relevant factor, conrm that these are appropriate scales. Overall, the measures of different constructs are clearly distinguishable from each other. This provides evidence for satisfactory discriminant validity. The second purpose of this factor analysis was to assess the multi-dimensional nature of perceived project performance. The project performance criteria were operationalized as cost, time, technical performance and customer satisfaction. A factor analysis was conducted to determine if performance could be considered a uni-dimensional construct.

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This analysis shows that only one factor was extracted. This is specied as success criteria. The results of this analysis are presented in Table 5. The analysis identied ve groups of key project factors with an eigenvalue greater than 1, accounting for 66.94% of the cumulative variance, and one group of success criteria with an eigenvalue greater than 1, accounting 57.51% of the variance. The common accepted decision criteria in research were applied: an eigenvalue more than 1, at least 50% variance being explained, and the simplicity of the factor structure (Hair et al. 1995). Cronbachs alpha scores were used to assess the reliabilities for the ve groups of key project factors and the success criteria. The member competencies, manager competencies, organization support, external stability and project situation had reliabilities ranging from 0.90 to 0.68. Project situation has marginal reliability. Project success had a reliability of 0.72. All principal components had a Cronbachs alpha value more than 0.60, a threshold acceptable in exploratory research (Nunnally 1978, Yoon et al. 1995).

Hierarchical regression analysis To examine the direct relationships between the project factors (member competencies, manager competencies, organization support, external stability and project situation) and project success, regression analysis was used. The moderating inuences of project characteristics (ownership, number of activities, total budget, project form, implementation stage and completed stage) were also included. Three hierarchical models were developed. The rst introduced the ve groups of project factors in Model 1; six background characteristics are included in Model 2 as dummy variables. The third model added eight interactive terms to the signicant groups of factors and two statistically signicant dummy variables in Model 3. The results of this analysis are presented in Table 6. Model 1 in Table 6 indicates that four groups of factors including manager competencies, member competencies, external stability and organization support have a signicant positive relationship with success criteria. Only the project situation has a negative effect on success criteria, but is not statistically signicant. When the six background characteristics treated as dummy variables are entered in Model 2, manager competencies, member competencies, external stability and

Table 5. Results of factor analysis for success criteria. Factor 1: Project success criteria Technical performance Customer satisfaction Cost Time Eigenvalues Variance explained (%) Cumulative variance explained (%) Cronbachs alpha KMO 0.718 .839 .789 .727 .667 2.300 57.51 57.51 0.7259

Notes: Rotation method Varimax with Kaiser normalization. Factor loadings less than 0.40 have been omitted.

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Table 6. Hierarchical regression analysis of success criteria. Variables Antecedent variables (project factors) Manager competencies Member competencies External stability Organization support Project situation Moderators (project background characteristics) Completed Implementation Ownership No. activities Budget Project form Interaction with moderators Manager competencies* Implementation Member competencies * Implementation External stability * Implementation Organization support * Implementation Manager competencies * Completed Member competencies * Completed External stability * Completed Organization support * Completed Constant/Intercept term F-value R2-value Adjusted R2-value
Notes: *p , 0.05; ** p , 0.01.

585

Model 1 0.358** 0.309** 0.284** 0.119* 2 0.400

Model 2 0.325** 0.315** 0.286** 0.116* 2 0.051 0.290** 0.149* 2 0.119 0.081 0.027 0.028

Model 3 0.305** 0.308** 0.146* 0.001 2 0.036 0.294** 0.157* 2 0.115 0.049 0.032 0.015 0.005 2 0.008 0.209** 0.154** 2 0.004 0.029 2 0.118 2 0.007 2 0.309** 19.831** 0.423 0.402

2 0.01145 22.453** 0.319 0.305

2 0.301** 19.622** 0.383 0.363

organization support continue to be signicant, along with the addition of the completed stage and the implementation stage. Adding the eight interactive relationships between the four signicant groups of factors and the two signicant dummy variables in Model 3, the three factors of manager competencies, member competencies and external stability and two project characteristics of completion stage and implementation stage still have statistical signicance. There are only two interactive variable terms which are signicant. The implementation stage of the project moderates both the effects of external stability and organization support on success. The overall model explains the data reasonably well, with 40.2% of the total variance in the data being explained by Model 3. At each stage in transition from one model to the next, the increment in adjusted R2 is also signicant (Table 6). Manager competence (.358) has the strongest relationship to performance, followed by member competencies (.309). In the project environment context, external stability (.284) is the most important. Organizational support (.119) is also positively related. It is interesting that the stage of the project (completed or implementation) relates signicantly to success. This suggests that project managers do not recognize the importance of results until the later stages of a project. This issue indicates that better and continuous performance monitoring in projects is necessary.

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The implementation stage is inuenced very much by the project environment as it inuences performance. Both external stability and organization support are signicantly related. Other background characteristics such as ownership, number of activities, budget and organizational form do not have any inuence on performance. Discussion A total of ve hypotheses were developed to examine the relationships in the conceptual framework. The hierarchical regression results provided statistical evidence to support three hypotheses related to the factors of external stability, manager competencies and member competencies and rejected the hypothesis related to the factor of organizational support. The results conrmed that the factors of external stability, manager competencies and member competencies had a positive and signicant impact on project performance. These also provide conrmatory support to the success factors developed by Belassi and Tukel (1996) and Pinto and Slevin (1987). For the moderating inuences of project characteristics, the hypothesis concerning the project characteristics signicantly inuencing the relationship between project factors and project performance was supported. This provides support conrming the intervening effect of the project stage on project results as proposed by Belout and Gauvreau (2004). However, the hypothesis on the impact of organizational support on performance was rejected by the analysis. This indicates that the organizational support factor does not have a signicant impact on project performance. In the focus group, 52.4% of participants agreed with this result; 38.1% disagreed and 9.5% gave other comments. Almost all participants agreed that the inuence of organization support on project performance depends on the project stage and project scale. Organizational support is less important than other factors in the implementation stage and in small- and medium-scale projects. But in the beginning stage (project conception and planning) or completion of large-scale projects, organization support is very important. The research results are supported by these comments because 44.0% of the projects of the sample were in the implementation stage and nearly half of projects were of small scale (the number of activities less than 100 with a total project budget less than 1 million US dollars). In addition, enterprises implementing infrastructure projects in Vietnam were not directly responsible for the administration of projects. Projects are normally organized as an independent project management unit (PMU). The cooperation, collaboration and communication between the PMU and the enterprise are in many cases ineffective. Consequently, the support of the organization is often less important related to project performance. Implications In summary, there are signicant implications from the results obtained. First, from the literature review of project management, key project factors were identied. The criteria for success determined for projects in Vietnam were assessed to examine the relationship between these factors and the performance of projects in a developing country. The results supported and conrmed the project factors and criteria developed in past research conducted in advanced economies. This supports the inclusiveness of the project management approach. Second, this study demonstrated that factors related to manager competencies and member competencies affect success criteria. It suggests that more emphasis on developing these competencies through more appropriate training for

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managers and professionals in skills and certications may be very important for the future success of projects (White and Fortune 2002). Appropriate training has an important part to play in enhancing professional development and adaptability (Hansson et al. 2003). Cheng et al. (2007) found implementing new project management solutions required training and monitoring of the performance of projects on a continuous basis to enhance the success of projects. Third, the manager and team competencies are more important to the success of a project in the implementation and completion stages. This is where projects managers have a major role in effective performance. Limitations The research has identied the causal effects between some critical factors and the success of a project, but did not examine the specic inter-relationships between these factors. This could be done in the future using structural equation modelling. Another limitation concerns the use of an altitudinal survey. The focus of this study was designed to assess how managers in infrastructure projects in Vietnam perceived project success and its related factors. There is certainly the possibility of bias in their responses. Observations of project managers and team members in actual projects would provide an interesting perspective on these ndings. The study only included a sample from Vietnam. A wider survey of project professionals in Asia Pacic would guarantee greater external validity. Conclusions This study developed and tested a comprehensive model of key project factors relevant to developing countries like Vietnam and identied the project characteristics that affect project success. Hierarchical regression analysis indicates that the model explains 40% of the total variance in project success. From a theoretical perspective, the results of the factor analysis in this study provide some conrmation of the success factors developed by Belassi and Tukel (1996) and Pinto and Slevin (1987) relevant to advanced economies. These are the external environment, project manager, team members, organization and project characteristics. The results also conrmed that success is dened uni-dimensionally, including cost, time, technical performance and customer satisfaction. These criteria are widely used in previous research, but only as separate indicators. A new contribution from the analysis of the overall model is that three factors manager competencies, member competencies, and external stability have signicant positive relationships to success. For the moderating inuences of project characteristics, the stages of completion and implementation in the project life cycle are also positively related. It means the relationships between the project management factors and success is stronger in the completion and implementation stages of project. Only two interactive relationships emerge as signicant. The implementation stage of a project moderates both the effects of external stability and organization support on success. The relationships between these factors and success are stronger in the implementation stage. This provides some conrmation for the intervening effect of the project stage proposed by Belout and Gauvreau (2004). Infrastructure projects throughout East Asia have similar project environmental factors like public investment, signicant bureaucracy, limited transparency and lack of sufciently trained project managers. The ndings of this study can be generalized for projects throughout the region, if applied with caution.

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Notes on contributors
Cao Hao Thi is currently a Faculty member at the School of Industrial Management, HoChiMinh City University of Technology, Vietnam. He holds a PhD in International Business Administration from the Asian Institute of Technology (AIT) (Thailand), an ME in Water Resource Development from AIT, and a BSc in Civil Engineering from HCMC University of Technology. Fredric William Swierczek is an Associate Professor of Management at the School of Management of the Asian Institute of Technology, Thailand. He is the coordinator of International Business Program and coordinator of the Executive MBA, AIT Vietnam.

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