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ISSN 1750-9653, England, UK International Journal of Management Science and Engineering Management, 6(5): 343-349, 2011 http://www.ijmsem.

org/

The critical success factors inuencing project performance in Nigeria


Amaka Ogwueleka
Department of Quantity Surveying, University of Uyo, Uyo PMB 1017, Nigeria (Received 2 September 2010, Revised 5 April 2011, Accepted 27 April 2011)

Abstract. Success factors are inputs to management system which can lead directly or indirectly to project success. This paper aims to investigate the critical success factors inuencing project performance in Nigeria. The objectives are to identify success factors existing in projects and also to examine the important index of these success factors on project performance in Nigeria. Twenty-two success factors were selected from the literature for the research with sample size of 188 professionals. The data obtained from the questionnaire are analyzed using frequency, severity and important indices. The reliability test on the data using Crobachs alpha displays, sixteen success factors were necessary for true satisfaction of successful project implementation in Nigerian Construction Industry. Based on the result, objective management, management of design, technical factors, top management support and risk management were selected as the most critical success factors in project performance. The ndings are focused to assist practitioners gain better understanding on the key areas based on prioritized success factors in order to improve performance in project delivery. Keywords: critical success factor, project performance, objective management, technical factors, top management support, market intelligence

1 Introduction
The management of projects has shifted from the use of hard system approach to soft factors (Litsikakis, 2008). Hard systems approach involves the adoption of mechanical motions in project implementation (Major, 2005). Many researchers have proved the approach to be faulty due to the change in demand from conformance (specication) to performance (incorporating the voice of the customer). In order to achieve performance in project delivery, soft factors must be considered. Soft factors involve the development of a series of soft skills focusing on maximum customer delight. These soft factors are applied throughout the lifecycle of the project in order to enhance the success of the project. Previous studies have revealed that soft factors have been applied in project delivery in Nigeria but poor project performance has also been recorded. This has resulted to low productivity growth which runs across all industrial sectors including Nigerian Construction Industry (Adenikinju and Ayonrinde, 2001 [2]; Adenikinju and Soludo, 1997 [3]). Malladi (2007) [20] stipulated that enhancement of project performance will bridge productivity gaps. In enhancing project performance, there is a need to address the problematic issues restricting project performance. However, many problems have arisen during project implementations which are centered on overruns of project indicators. In recent years, Nigerian economy has grown up speedily. Nigeria operates mono-product economy with absolute dependence on crude oil export. In 2001, crude oil export was estimated 98.7% of foreign exchange earned. This impact has eased nancial constraints to infrastructure development and urbanization but has also created easy trans

mission of uctuation existing in the highly volatile world oil market into economy. Instability in Nigerian economic system is driven primarily by accumulating factor inputs (Adenikinju, 2005 [1]). These involve continued accumulation of productive inputs and imports which have created negative impact on performance of Nigerian industries. Krugman (1994) [17] emphasized that continued accumulation of these inputs generate perspiration into an economy which may not be sustainable in the long run. Developing countries have higher rate of low project performance than developed countries (Lim and Alum, 1995 [18]). Most researchers discussed the increased challenges and decreasing performance of the construction industry (Casler and Gallatin, 1997 [9]; Teicholz et al., 2001 [36]). The major indicators of performance in construction projects were identied as time, cost and quality (Mckim et al., 2000 [23]; Atkinson, 1999 [5]). These indicators are driven by factors that can be used to ascertain the strengths and weaknesses in project performance (Marteralla, 2007 [21]). These factors may be pitfalls or success factors. According to Olav et al., (2007) [29], success factors were considered as opposite of pitfalls. This research is focused on success factors inuencing project performance. Cooke-Davies (2002) [13] dened project success factors as inputs to the management system that lead directly or indirectly to the project success. The identication of these success factors has become critical issues facing project managers (Motwani et al., 1995 [25]). Evidences have proved most construction projects in developing countries suer overrun in cost and time. Iyer and Tha (2006) [14] revealed that 40% of Indian Construction projects are facing time overrun ranging from 1 to 252 months. Ugandan Construction Industry experiences cost and time overruns (Mubiru, 2001 [26]). Construction delay

Correspondence to : E-mail address : chichiogwueleka@yahoo.com. International Society of Management Science and Engineering Management

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A. Ogwueleka: The critical success factors inuencing project performance in Nigeria

and cost overruns are cogitated as frequency project problems in Vietnam government-related funded projects (Ministry of planning and investment, 2003). Adenikinju (2005) [1] graded productivity performance in Nigeria to be below average. His ndings revealed technically ineciency as a major inuence to the decline. The result showed that technical eciency declined by -1.29 percent per annum for the period of 1962 2000 while technical change declined by 1.01 percent annually over the same period. Most researchers have studied critical project success factors inuencing projects in both developed and developing countries. Although Nigerian economic system possesses most of the characteristics associated with developing countries, the trend diers. Iyer and Tha (2006) [14] emphasized that project factors dier from one project to another. Nigerian Construction Industry has witnessed incline in diverse construction projects over the years, this research is limited to large construction projects with minimum budget of N100million. Following the denition of large construction projects by Long et al. (2004) [19], the selected large construction projects were projects with total budget of over $ 1million which is equivalent to over N140million. This research is aimed at investigating the critical success factors inuencing project performance in Nigeria. The following objectives were adopted to achieve this aim:

To identify success factors existing in projects; To examine important index of these identied success factors on project performance in Nigeria and to uncover any underlying interrelationship existing between the success factors.
According to Chua et al. (1999) [10], the identication of key project success factors of any project will enable appropriate allocation of limited resources. The main goal is to redirect the construction rms on how to build their capabilities toward adopting the appropriate strategy based on prioritized success factors in order to improve performance in project delivery.

Ogunlana (2009) [33] studied in critical success factors in large scale construction projects in Thailand. Their study emphasized that success factors vary across various projects. Their ndings revealed project planning and control, project personnel and involvement of client as critical factors inuencing project success. Ann et al. (2006) [39] in their study, investigated on CSFs in construction project brieng. Brieng process is prerequisite to achieving success in project performance. This process involves the interpretation of clients actual views and requirements to project participants. Their study considered open and eective communication, clear and precise brieng documents, clear intention and objectives of client and clear project goal and objectives as critical success factors. Ugwu et al. (2007) [37] identied nine top critical success factors that would act as enablers for successful implementation of ICT projects in construction as cost of development, top management support, availability of appropriate tools, development team knowledge and understanding of construction processes, ease applications, clear denition and understanding end user, clear communication, standardization issues and change management of organization level. Marterella (2007) [21] reviewed over 50 business processes and disclosed eight critical sales success factors inuencing business performance as selection, performance management, skills assessment, dened solution oerings, demand creation, qualifying, proposal clarity and existing client expansion. Park (2009) [30] investigated a set of ten common factors and 188 individual factors inuencing whole life performance of South Korean projects. The study was focused on identifying the most critical individual factor in each common factor. The result identied the following individual factors in each common factor; clarity of contract, xed construction period, precise project budget estimate, material and quality, mutual and trusting relationships, leadership and team management, then nally management of work safety on site. Iyer and Tha (2006) [14] found out through a survey in India that two most critical success factors are commitment of participants and owners competence. Executive support, user involvement, experienced project manager, clear business objectives, minimized scope, standard software infrastructure, rm basic requirements, formal methodology and reliable estimates were found out as the nine top success factors inuencing project performance (Gartner group, 2004). Belassi and Tukei (1996) [6] emphasized ve critical success factors as the project manager, project team, project itself, organization and external environment. Pinto and Kharbanda (1995) [31] identied early and continual client consultation, technology, scheduling system, project team and top management support as the most signicant critical success factors. Project summary, operational concept, top management support, nancial support, logistic requirements, facility support, market intelligence, project schedule, executive development and training, manpower and organization, acquisition, information and communication channels and project review were identied as critical success factors inuencing project performance (Cleland and King, 1983 [12]). Leadership, partnership, proof and clarity of innovative concept, business planning and marketing, triple bottom line planning, short and long term benets management, community engagement and risk management were also found out as critical success factors in project implementation (Boyer et al., 2008 [7]).Communication, project planning and control, objective management and project size and duration were clas-

2 Critical success factors inuencing project performance


Success is dened in the context of project as the art of gaining consensus from a group of people on the denition of good art (Jugder and Muller, 2005 [15]). Project success is the most debated topic in the management eld, but also the least agreed upon (Shenhar et al., 1997 [35]). The determination of project success may not even be unanimous among the team and client personnel (Rad and Ginger, 2002 [32]). For example, an architect may consider success in terms of aesthetic appearance while an engineer may consider in terms of technical competence. The parameters for measuring project success are mostly inuenced by project type and specications. Rockart (1976) dened critical success factors as areas in which results, if they are satisfactory, will ensure successful competitive performance for organization. Maylor (2003) [22] viewed satisfaction as the dierence between how the project is perceived or viewed by a stakeholder and how they expect the project to perform. Various project success factors have been identied by dierent researchers in dierent projects around the world. Community involvement, project objectives, technical innovation, uncertainty, politics, schedule duration urgency, nancial contract, legal factors and implementation process were established as the critical success factors in projects (Morris and Hughes, 1987 [24]). Shamas-ur-Rehman and

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International Journal of Management Science and Engineering Management, 6(5): 343-349, 2011 Table 1 Summary of literature reviews on CSFs for project performance

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Success Factors (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17) X X Community Engagement X X X X X X X X X Objective management Technical factors X X X Uncertainty/risk management X X X X Commitment of participants X X X X Financial support X Legal factors X X Interface towards surrounding projects X X X X X X X X X X Top management support Skill acquisition and availability of X X X manpower X X X X Communication channels X X X X X X Project organization X X X Performance management X Demand creation X Resolution X X X Precise project budget estimate X Nature and market conditions X X X X X X X Stakeholder management X X X Stable framework condition Design management X X X X X X X X X Project planning and control X X X Environmental factors/politics X X X X Mutual relationship X X X X Innovation concept X X X X X Contract strategy (1) Morris and Hughes (1987) [24], (2) Ugwu et al. (2007) [37], (3) Marterella (2007) [21], (4) Park (2009) [30], (5) Iyer and Tha (2006) [14], (6) Belassi and Tukei (1996) [6], (7) Gartner group (2004), (8) Pinto and Kharbanda (1995) [31], (9) Cleland and King (1983) [12], (10) Boyer et al. (2008) [7], (11) Clarke (1999) [11], (12) Cooke-davie (2002) [13], (13) Muller (2005) [27], (14) Rockart (1979) [34], (15) Shamas-ur-rahman (2009) [33], (16) Ann et al. (2006) [39], (17) Arain (2007) [4].

sied as critical success factors in project implementation (Clarke, 1999 [11]). Cooke-Davie (2002) [13] identied the critical success factors in project execution as objective management, monitor performance and feedback, teamwork, risk management, stakeholder management and project size and duration. Muller (2005) [27] found out the critical success factors as selection criteria, commitment to project planning and control, monitoring performance and feedback, mutual relationship and project ownership. Project goals and client criteria, leadership style, clarity of scope and work denition, project manager characteristic, clients own organization, project teamwork, planning and programming techniques, the selection process of building team, project managers authority and inuence and project cost estimate were suggested as the most important success factors t within strategic, structural, technical and managerial subsystems of any of Pakistans construction Industry (Arain, 2007 [4]). Rockart (1979) [34] identied the major sources of critical success factors as environment factors, temporal factors, industry, competitive strategy, industry and managerial positions. Tab. 1 shows the summary of literature reviews on critical factors for project success.

questionnaires were found eective because of the relative ease of obtaining standard data appropriate for achieving the objectives of this study. Kothari (2003) [16] stipulated survey protocol of random sampling procedures allows a relatively small number of people to represent a much larger population. Based on the literature cited, twenty-two success factors were selected from projects relating to construction and business performance. The CSFs identied in ICT projects were considered not relevant for this study. Pilot studies were carried out to ensure the clarity and relevance of the drafted questionnaire. The drafted questionnaire was shown to four professionals in the research eld to review. The two professionals were university professors and others were researchers in the related eld. Amendments were made on the drafted questionnaire based on suggestions of the reviewers. The questionnaire required the respondents to rank their answers using ve-point scale. For frequency index, the values are represented as follows: 0 = No, 1 = rarely, 2 = sometimes, 3 = often, 4 = always while values assigned for ranking severity index are 0 = No, 1 = little, 2 = moderate, 3 = very, 4 = extremely. 3.2 Characteristics of respondents The case study area (Nigeria) is grouped into four regions namely Southern, Eastern, Western and Northern parts. The study targeted 20 companies from each region in order to obtain equal representation of the entire population. In each region, the companies were randomly selected. This procedure was adopted in order to cover the entire case study area using relative small population. The population

3 Research methodology
3.1 Questionnaire design The research adopted eld survey methodology to uncover critical success factors inuencing project performance in Nigerian Construction Industry. Surveys through

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A. Ogwueleka: The critical success factors inuencing project performance in Nigeria Table 2 Demographic data of respondent Frequency Percent % Cumulative percent Profession of Respondents ( N = 188) At least degree certicate in related elds Diplomas or equivalent certicates Tradesmen or technical vocational trainees Years of working Experiences ( N = 188) 1 5 years 5 10 years Above 10 years Type of projects involvement Building and Industrial projects Bridge and road projects Both 25 11.7 100 Average Project Budget estimate ( N = 80) N100M N250M N250M N500M Above N500M 15 48 25 18.8 60.0 31.2 18.8 78.8 100 105 83 49.3 39.0 49.3 88.3 56 95 37 29.8 50.5 19.7 29.8 80.3 100 33 97 58 17.5 51.6 30.9 17.5 69.1 100

size of 80 companies fully registered with Federal Ministry of Works and Housing was selected. A total of 220 questionnaires were sent to construction professionals working with the selected contractors. Face to face delivery is preferred to promote respondents and raise the response rate. For varied reasons, 32 did not participate in the research which reduced sample size to 188. The response rate of 85.5% was obtained. The survey was carried out within a period of ve months from June to October, 2009. Tab. 2 reveals the demographic data of respondents. This shows that 69.1% of the respondents are generally well-educated and have ample experiences in the construction industry while 30.9% of the respondents comprise of either tradesmen or technical vocational trainees.

4.2 Discussion Assumption is made based on Pareto rule that the highest ranked has the greatest inuence. The Tab. 3 shows the frequency, severity and important indices of twentytwo identied success factors. The results of the important index were ranked and the ve highest scores were objective management, management of design, technical factors, top management support and risk management. The success factor of objective management is ranked rst on importance index. The ndings revealed that most stakeholders always try to diversify their resources into protable areas. Focusing on protable areas is the proof of unwillingness to accept risk. Risk management practices are not viable in Nigerian Construction Industry. Although, some contractors claim that they practice them but evidences have proved that risk response and implementation were recorded in their practices only. Most stakeholders are not willing to accept risk rather they avoid or transfer it. Objective management is recommended as a critical success factor which can be properly managed to prevent project failure. This recommendation is in line with the ndings of Morris and Hughes (1987) [24], objective management was disclosed as a control process in which sequential action can be taken by project actors to establish performance standards, measure and evaluate performance and also take corrective actions where indicated. The adoption of objective management strategies enables best results to be generated from available resources. Project productivity and eciency can be more eective through objective management process, hereby enabling prompt corrective actions to be taken in order to reduce wastage. The success factor of management of design is rated second according to important index. In construction projects, design is the essential process of communicating the stakeholders requirements to other parts of the organization. Most of the respondents considered changes in project denition to be inevitable part of the design process. The study disclosed variations occur most frequently in Nigerian construction projects. Managing the process of design reiteration is essential in order to adapt quickly to changes and new information where required. The analysis exposed the inability to manage design changes has resulted to poor

4 Results and discussion


4.1 Data analysis and results Evaluation of data was done through three types of indices namely frequency, severity and importance indices. The frequency index is calculated using formula:
4

F.I =

a1 n1 /4 N ,
0

where, a : weight assigned; n : frequency of each response; N : total number of responses. The severity index is computed using the formula:
4

S.I =

a1 n1 /4 N ,
0

where, a : weight assigned; n : frequency of each response; N : total number of responses. The important index expresses the overview of the factors on both frequency and severity. It is calculated using the formula: IMP.I = F.I S.I.

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International Journal of Management Science and Engineering Management, 6(5): 343-349, 2011 Table 3 Frequency, severity and importance indices of the success factors inuencing project performance s/n Success Factors Frequency index Severity index Importance Index Rank 0.788 0.819 0.789 0.650 0.556 0.478 0.829 0.825 0.552 0.526 0.724 0.661 0.576 0.447 0.474 0.518 0.626 0.550 0.610 0.404 0.707 0.642 0.817 0.842 0.715 0.777 0.700 0.679 0.795 0.809 0.474 0.790 0.805 0.650 0.609 0.403 0.487 0.414 0.717 0.625 0.636 0.401 0.840 0.807 0.643 0.690 0.564 0.505 0.389 0.325 0.659 0.667 0.262 0.416 0.583 0.430 0.351 0.180 0.231 0.214 0.449 0.350 0.388 0.162 0.594 0.519 4 1 7 9 13 17 3 2 18 12 6 11 15 21 19 20 10 16 14 22 5 8

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1 Top management support 2 Objective management 3 Nature and market conditions 4 Stakeholder management 5 Project organization 6 Stable framework condition 7 Technical Factors 8 Management of Design 9 Interface towards surrounding projects 10 Project planning and control 11 Financial support 12 Communication channels 13 Precise project budget estimate 14 Legal factors 15 Environmental factors 16 Mutual relationship 17 Commitment of participants 18 Skills acquisition and availability of manpower 19 Innovative concept 20 Community engagement 21 Risk management 22 Contract strategy

project performance in Nigeria. Technical factor is ranked third; the analysis disclosed that the availability of project actors with relevant skills and required technology is critical for new projects. Although the demographic data revealed 69.1 percent of the workers had at least diploma certicates in related elds. But the study disclosed insucient availability of technical skills. Most of these skills can be acquired in technical institutions, the analysis showed below average percentage of workers to be tradesmen or technical vocational trainees which maybe the major cause of the insuciency. The success factor of top management support is ranked fourth overall. The study revealed top management team provides strong and consistent support to nance, resources and leadership in projects. The importance of top management support is found to be strong factor that must be present to ensure a successful project outcome. Without top management support, the chances of project success may be crippled. The top management support is considered as critical success which is in line with the ndings of Ugwu et al. (2003) [38], Park (2009) [30], Pinto and Kharbanda (1995) [31], Cleland and King (1983) [12] and Boyler et al. (2008) [7]. Table 3 ranked risk management as the fth highest success factor. Risk management resolves uncertainty relating to outcomes (Ogwueleka, 2009 [28]). Uncertainties inuence project performance, the ability to analyze project uncertainties will enable mitigation measures to be taken and applied appropriately (Mendel, 2005). The analysis disclosed risk management as critical success factor inuencing project performance in Nigeria in line with the ndings of Cooke-Davie (2002) [13] and Boyler et al. (2008) [7]. 4.3 Reliability analysis This analysis is aimed at testing if the results are reliable or not. The reliability tests were performed on scales of each

factor using Crobachs . The computation of Cronbachs in measuring internal consistency of items in scale and/ or responses to question that were designed to represent a construct (Garson, 1999 [8]), is given by the equation. Crobach = k k1 1

i =1

Si2 / S2 p

where K : number of items in scale; 2 : variance of item I; Si 2 S p : variance of total score. The construct allows negative to be detected and positive to be accepted ranging from 0 to 1.0. The cut-o value is 0.70 that is for items to be used together as a scale, the items must be above the cut-o value. If the alpha increases over the current total scale when an item is deleted, the rule of thumb is to delete the item unless it is theoretically necessary for the analysis. The analysis of the reliability tests are tabulated in Tab. 4 showing the accepted positive . The test result shows that the alpha scores for sixteen success factors were greater than 0.70 and less than 1.00. Five factors scored outside the acceptable range, which show they are not necessary for true satisfaction of successful project implementation in large Nigerian construction projects.

5 Conclusion
The research survey demonstrated the operating environment has a vital role in determining the critical success factors inuencing project performance of a project. The result revealed six critical success factors which can inuence project performance in Nigeria. These factors were objective management, management of design, technical factors,

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A. Ogwueleka: The critical success factors inuencing project performance in Nigeria environmental enterprises. International Institute for Sustainable Development, SEED Initiative Research Program. Garson, G. (1999). Reliability Analysis. PA 765 Quantitative Research on public adminstration. Retrieved on Apirl, 2008 Casler, S. and Gallatin, M. (1997). Sectoral contributions to total factor productivity: Another perceptive on the growth shutdown. Journal of Macroeconomics, 19(3):381393. Chua, D., Kog, Y., and Loh, P. (1999). Critical success factors for dierent project objectives. Journal of Construction Engineering and Management, 125:142150. Clarke, A. (1999). A practical use of key success factors to improve the eective of project management. International Journal of Project Management, 17(3):139145. Cleland, D. and King, W. (1983). Systematic Analysis and Project Management. New York: McGraw-Hill. Cooke-Davies, T. (2002). The real success factors in projects. International Journal of Project Management, 6(3):164170. Iyer, K. and Tha, K. (2006). Critical factors aecting schedule performance: Evidence from Indian construction projects. Journal of Construction Engineering and Management, 132(8):871 881. Jugder, K. and Muller, R. (2005). A retrospective look at our evolving understanding of project success. Project Management Journal, 36(4):1931. Kothari, C. (2003). Research Methodology, Methods and Techniques. New Delhi: New Age Publications, 2rd edition. Krugman, P. (1994). The myth of asias miracle. Foreign Aairs, 73(6):6277. Lim, E. and Alum, J. (1995). Construction productivity: Issues encountered by contractors in Singapore. International Journal of Project Management, 13(1):5158. Long, N., Ogunlana, S., and Lan, D. (2004). A study of project success factors in a large construction projects in Vietnam. Journal of Engineering, Construction and Architectural Management, 11(6):404413. Malladi, S. (2007). Enhancing project performance and productivity-addressing it in project management and beyond, PM tips and techniques. PM World Today, 9(7). Marteralla, J. (2007). The eight success factors of a high performance sales and marketing organisation. A Chally Focus Article, Sales and Marketing: Executive Strategies for Growth (electronic). Maylor, H. (2003). Project Management. UK: FT Prentice Hall, 3rd edition edition. Mckim, R., Hezagy, T., and Attala, M. (2000). Project performance control in construction projects. Journal of Construction Engineering and Management, 126(2):137141. Morris and Hughes (1987). The anatomy of major projects: a study of the reality of project management. Chichester: John Wiley and Sons, pages 2138, 193270. Motwani, J., Kumar, A., and Novakoski, M. (1995). Measuring construction productivity: a practical approach. Work Study, 44(8):18 20. Muburi, F. (2001). Comparative analysis of bidding strategies of contractors in Uganda. M.Sc thesis, Makerere University, Kampala. Muller, R. and Turner, J. (2005). The project managers leadership style as a success factor on projects: a literature review. Project Management Journal, 36(2):4961. Ogwueleka, A. (2009). Value and Risk Management in Construction Projects-smart strategy. Journal of Environmental research and Policies, 4(1):8993. Olav, T., Kjell, A., and Wubishet, J. (2007). Critical success factors for project performance: a study from front-end assessments of large public projects in Norway. A Study Paper, New Delhi: New Age Publications.

top management support and risk management. The reliability test using Crobachs shows that the alpha scores for sixteen success factors were greater than 0.70 and less than 1.00 and ve factors scored outside the acceptable range. The analysis shows only the sixteen success factors are necessary for true satisfaction of successful project implementation. From the results, the taking up of these six identied critical success factors is essential for practitioners in order to reduce project failures and increase project performance in Nigerian Construction Industry. The ndings will enable practitioners to gain better understanding on the key areas to focus in order to obtain optimum results. The research ndings are not limited to only practitioners in Nigeria but also other developing countries with similar features. I recommend the results from this study for adoption in project delivery as crucial elements to facilitate performance. These results can also be used as input variables in developing models for project success.
Table 4 Results of the accepted reliability tests Success factors Top management support Objective management Nature and market conditions Stakeholder management Project organization Technical Factors Management of Design Project planning and control Financial support Communication channels Precise project budget estimate Commitment of participants Skills acquisition and availability of manpower Innovative concept Risk management Contract strategy Cronbach 0.98 0.97 0.99 0.99 1.0 0.98 0.97 1.00 0.98 1.00 1.00 0.99 1.00 1.00 0.98 0.99

[8]

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[11]

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[19]

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