Project success and project team management: Evidence from capital projects in the process industries

TLDR

Efficient project execution is a key business objective, especially for capital projects in the process industries, yet existing research offers little guidance on how team factors affect cost, schedule, and operability, and the study’s implications for researchers and practitioners are discussed. The authors built and tested a five‑dimensional model of organizational context, team design, leadership, processes, and outcomes, and evaluated it using an empirical study of 56 newly completed capital projects from 15 Fortune 500 process‑industry firms. Results demonstrate that disaggregating outcomes reveals distinct team‑factor bundles: cost effectiveness is driven by team efficacy, cross‑functional teams, autonomous structure, and virtual office use; schedule by continuity of leadership, cross‑functional teams, and manager incentives; operability by clear goals and communication‑facilitating office design, implying managers should prioritize goals to select the appropriate practices.

Abstract

Abstract Efficient project execution is a key business objective in many domains and particularly so for capital projects in the process industries, but existing project management research gives little direction about how project team factors influence three important capital project outcomes: cost, schedule, and operability. After an extensive cross‐disciplinary review of the general team and project management literatures, we constructed and tested a theoretically based, five‐dimensional model of organizational context, project team design, project team leadership, project team processes, and project outcome factors. We examined the model by means of an empirical study of 56 newly completed capital projects executed by 15 Fortune 500 companies in the process industries. The results indicate the value of disaggregating project outcomes for research purposes. Different bundles of project team factors were found to drive project cost, schedule, and operability. Project team efficacy, cross‐functional project teams, autonomous project team structure, and virtual office usage were the strongest predictors of project cost effectiveness. Continuity of project leadership, cross‐functional project teams, and project manager incentives were the strongest predictors of project construction schedule. In contrast, clear project goals and an office design to facilitate effective communication were the main predictors of plant operability. Implications of these findings for researchers and project practitioners are discussed. One major practical implication of our findings is that project managers need to clearly focus and prioritize their goals for each project so they can adopt the appropriate bundles of project team practices that will facilitate their goal achievement.