A dynamic model for evaluating the success of construction mega projects in China

Abstract

Megaprojects are typically defined as large-scale investments that cost at least one billion US dollars, take many years to build, involve many stakeholders and affect millions of people. Over the past years, the investment and construction of megaprojects throughout the world remarkably increased. However, the performance of megaprojects is not always satisfactory. "Over budget, over time, under benefits, over and over again" seems to have become the iron law of megaproject management. One of the most influential factors is the lack of a scientific evaluation model for construction megaproject success (CMS). Therefore, in-depth research is necessary to develop such a model. This research aims to develop a systematic and dynamic model for evaluating and enhancing the success of construction megaprojects in China by satisfying five specific objectives: (1) identify a set of key performance indicators (KPIs) for measuring the CMS, (2) identify the critical success factors (CSFs) that exert strong effects on the CMS, (3) explore the relationships between the identified CSFs and KPIs, (4) establish a model that will dynamically evaluate the success level of construction megaprojects and (5) conduct scenario analysis to identify the effective managerial strategies for enhancing the success level of construction megaproject management. A mixed research methodology is adopted in this study, including literature review, interview and questionnaire survey, Cronbach's alpha technique, mean score ranking, factor analysis, fuzzy set theory, factor analysis, partial least squares structural equation modelling (PLS-SEM) and system dynamic (SD) model. To construct the theoretical background, a holistic assessment of the project success in the field of construction and engineering management in the past decade was conducted through a comprehensive literature review. The literature revealed four underpinning concepts for this study, namely, megaproject success, project success in developing countries, relationships between CSFs and successful outcomes, and dynamic evaluation of project success. Then, a comprehensive literature review on the identification of success criteria and critical factors for CMS was conducted. Twenty success criteria grouped into four dimensions and 33 CSFs were identified, which represent the lists of potential success criteria and critical factors that are crucial to the development of the questionnaire. Expert interviews were subsequently conducted to explore the optional list of performance indicators and success factors in evaluating the success of construction megaprojects. A survey was conducted to determine the importance of the selected performance indicators and success factors. The fuzzy set theory was adopted to identify the KPIs. Nine KPIs were obtained, namely, meeting regulations or specifications; health, safety and environmental goals; meeting designed function and delivering value/services that the public needed, owner's satisfaction; government's satisfaction; improved brand/reputation; enhancing people's national pride and confidence; social-economic benefits to the community/local. Using the factor analysis technique, the 32 identified CSFs were grouped into six clusters: effectiveness of project management action, project participant-related factors, application of innovation management approaches, external factors, economic factors and organisational factors. Next, the PLS-SEM method was used to investigate the causal relationships between the identified CSFs and KPIs to evaluate the success of construction megaprojects. The results revealed that only the economic and organisational factors are positively correlated with the KPIs supported in the hypothesised model. Then, the CSF organisational citizenship behaviour (OCB) in the megaproject was selected from the group of organisational factors to examine its effects on the success of construction megaprojects. Lastly, the SD approach was used in this research to develop a model for evaluating the success of construction megaprojects. Three policy scenarios, that is, two single-policy scenarios and a multi-policy one, were adopted to simulate the success level of megaprojects under various policy scenarios. The simulation results indicated that an increase in the actual increasing rate of potential promotion (AIRPP) exhibits more evident effects on the improvement of OCB and the megaproject success than the increase in the actual increasing rate of project culture (AIRPC). Moreover, the simulation results of the multi-policy scenario showed that if the value of the AIRPP in combinations (the total value has been restricted) is high, then the value of OCB adoption and the success of the project will also be high. This phenomenon highlights the priority of improving AIRPC first before the other factors, specifically when the resources are limited. This study contributes to the theoretical and practical knowledge of construction megaproject management. To date, this study is the first to comprehensively explore the KPIs and CSFs of construction megaprojects. This study is also the first to develop a dynamic model that will consider the interrelationships between the CSFs and KPIs in evaluating the success of construction megaprojects. The findings can provide an insightful reference for practitioners in delivering satisfactory construction megaproject management. Furthermore, decision-makers can establish relevant policies according to the research results to implement the construction megaproject management effectively.