Global Business and Management Research: An International Journal (2011), Vol. 3 Nos.

3 & 4

An Empirical Study on Identification of

Critical Success Factors in Project Based
Organizations
Piyush Mishra, G.S.Dangayach, M.L.Mittal
Malaviya National Institute of Technology, Jaipur, India
Abstract
Purpose - This study aims at evaluating the critical success factors in case of project
based organizations. The paper examines critical success factors as well as the interrelationship between them so as to identify the most important parameter influencing
project success.
Design/methodology/approach - It is based on a survey done in organizations based
on project management across the country. It included public sector units as well as
private sector firms. The study is based on response received from one hundred thirty
seven firms involved in project management in one or another way.
Findings - The survey predicts project manager as more significant critical success
factor followed by the project team. Communication in project team has been found as
most critical success factor in project based enterprises. Also emotional quotient of
project manager has been found as a critical success factor in this study.
Keywords: Project Success, Team, Project Manager, Critical Success/Failure Factors
Paper type: Research Paper

Introduction
Project Management is becoming major organizational commotion performed
within organizations. More and more organizations are depending on project
management to achieve operational excellence and achieve business growth.
Achieving success in a project has become vital in the context of competition
and decreasing margin. The studies aiming at organizational effectiveness have
been at the core of organization theory in the recent years (kerzner, 1990).
Earlier research on project success has identified the factors based on a general
basis with all the industries taken together. Studies have been done on
identifying tools and techniques being used in the project management and
their merits and de-merit (Cooke-Davies 2002, Muller 2003, Fortune & White
2002, Hyvari 2006). A review of the literature finds that most of the studies
have been done in the western world (Murphy, Baker and Fisher, 1974, Pinto
and Slevin 1988, Gemuenden & Lechler 1997, Shehnar, Levy and Dvir 1997).
It reveals that despite of large work in this area no definite set of factors have
been agreed upon. It may be due to the organizational or cultural differences
through the world. There is need of empirical study to identify the critical
success factors on the basis of organization type and identify the relationship
among the various variables. Earlier researches have not focused on the role of
soft or people dimension of the project management and there is greater need
for identifying the human issues in project management. This paper presents
the survey done in modern organizations which are based on project
management in their daily work. It is aimed at identifying the critical success
and failure factors and increase the knowledge on organizations based on
project. In this paper the first section consists of the review of literature on
project success.
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Global Business and Management Research: An International Journal (2011), Vol. 3 Nos. 3 & 4
The second section consists of the survey done and analysis is presented on the basis of same.
The results are also compared with previous studies. In the last section relationships are
examined and directions for future research are given at the last.
Literature review
The field of project success is vast and there seems to be no consensus on the definition of
project success (Murphy, Baker and Fisher, 1974, Pinto and Slevin 1988, Gemuenden & Lechler
1997, Shehnar, Levy and Dvir 1997). Shenhar and Wideman (2000) concluded that there does
not appear to be any agreed-upon understanding of the concept of success in either business or
project management literature. Traditionally the literature on project management often mentions
Cost, Time and Quality as the project success criteria but these are not absolute. Many
researchers have identified the need to add other dimensions to it such as meeting customer
expectations, creation of new market share, and involvement of stakeholder in judging the
success (De wit, 1988). Rockart (1979) developed a three stage procedure to identify the critical
success factors which are essential for the success of organization. De Wit (1988) distinguished
between project success (final objective of the firm is the success criteria) and project
management success (the iron triangle of cost, time and quality are the criteria for the success).
Baccarini (1999) also identified the success as project management success and product success.
He laid stress that for the successful identification of definition of project success the difference
between these two is necessary. The second distinction pointed by Cooke-Davies (2002) is
between success criteria and success factors. According to them success criteria belongs to
specific measurement by which one can conclude whether the project succeeds or fails whereas
success factors is about tools and techniques which may be used by the organization or the
project manager to increase profitability. Morris and Hough (1987) surveyed 3500 projects and
found that overruns of 40% to 200% to be the norm. It shows that to identify whether a project is
success or failure is very difficult. Walker (1995) single out project scope as a factor affecting
project duration and therefore influencing on project success. Cleland and King (1983) came out
with a list of 13 factors affecting project success. Belassi and Tukel (1996) grouped success
factors in four major criteria. Atkinson (1999) measured project success on the basis of three
stages namely process, system & benefits. Scott-Young & Samson (2004) concluded that the
literature has not identified the people side of project i.e. human side in the role of project
success. Turner & Muller (2005) have identified the role of project manager and his leadership
style as the key to success.
The identification of critical success factors has dominated the field of project management from
1980s to till date. Various researchers have tried to identify the critical success factors across the
industries and different countries (Kerzner, 1987; Pinto and Slevin, 1987; Pinto and Slevin,
1989; Wateridge, 1995; Belassi and Tukel, 1996; Clarke, 1999; Cooke-Davis, 2002; Muller,
2003). The Pintos research in 1986 and his findings with Slevin on their findings of 10 critical
success factors have since became excellent work in this field. Cleland and King (1983) came
out with a list of 13 factors affecting project success. Morris and Hough (1987) after examination
of eight complex projects stated that the reason of failure lies in poor management skills.
According to them good communication skills, client involvement and qualified project team is
the key to success. Pinto and Slevin (1989) did a remarkable job in identification of the critical
success factors regardless of the project type. Freeman and Beale (1992) on reviewing the
literature identified five main critical success factors which are
1) Technical performance.
2) Efficiency of execution.
3) Customer satisfaction.
4) Personal growth.
5) Manufacturability and business performance.

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The literature review identifies that there is need to identify critical success factors at different
points of time and at different locations across the world due the various factors like age, sex,
demography, culture. Pinto & Prescott (1988) also concluded that various critical factors change
with the passage with time. Hence there is a need to identify the most critical success factors
which are relevant in recent days and in Indian conditions.
Research Methodology
First a pilot survey was conducted when the questionnaire was sent to 15 people in eleven
different organizations. The feedback was taken and then the necessary changes were done in the
questionnaire. Earlier work done by Fortune & White (2002) and I Hyvari (2006) also influenced
the questionnaire. The questionnaire was sent to nearly 500 organizations out of which 137
responded. A response rate of 27.4% was achieved. The recipients were requested to fill it only
if they were involved in any kind of project. Apart from it interviews were conducted with five
people of the field. The statistical software SPSS was used for analysis of the results. Reliability
analysis was done for the satisfaction of questionnaire.
Research Framework
The research model for the present research is based on the critical success factors collected from
the literature review and their impact on the project success, individually as well as collectively.
The critical success factors are grouped into six main characteristics which are further
subdivided. They are considered as independent variables and have been marked as (Fa1, Fa2,
Fa3, Fa4, Fa5, and Fa6). Since they lead to project success, hence project success is considered
as a dependent variable which changes according to the influence of independent variables. As a
result following research model is developed.

Figure 1: Research model Diagram

(Fan- a- success factor group, nis the individual success factor in the group)

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Global Business and Management Research: An International Journal (2011), Vol. 3 Nos. 3 & 4
The research model will identify the significance of the most critical success factors in project
based organizations. It will also seek to identify whether any relationship exists between the
various critical success factors as well as their correlation with other background variables. On
the basis of the above following hypothesis have been developed and will be tested.
Hypothesis Ha1: The critical success factors group Fa1 identified in the research has a
significant impact in attaining project success in case of project based organizations.
Hypothesis Ha2: The critical success factors group Fa2 identified in the research has a
significant impact in attaining project success in case of project based organizations.
Hypothesis Ha3: The critical success factors group Fa3 identified in the research has a
significant impact in attaining project success in case of project based organizations.
Hypothesis Ha4: The critical success factors group Fa4 identified in the research has a
significant impact in attaining project success in case of project based organizations.
Hypothesis Ha5: The critical success factors group Fa5 identified in the research has a
significant impact in attaining project success in case of project based organizations.
Hypothesis Ha6: The critical success factors group Fa6 identified in the research has a
significant impact in attaining project success in case of project based organizations.
Hypothesis Hb: The critical success factors identified in the research are interrelated in their
outcome on the project success in project based organizations.
Survey Findings
The figure 2 shows background of the respondents organization. Nearly 30% were from
manufacturing and construction industry. The software development and telecommunication
industry accounted for nearly 33% of the respondents. Industries based on power or energy
accounted for nearly 10% of the respondents. The age of respondents is shown in Table 1. It
shows that 70% of the respondents were below 45 yrs of age while nearly 30% were above the
age of 45 yrs. The organization size in terms of turnover is shown in Table 5. Nearly 30% of the
organizations were between 10-100cr, whereas 25% were less than 10cr. Almost 13% were
doing more than 1000 cr.
30
25
20
15
10
5
0

Figure 2: Industry background of respondents

As far as position is concerned nearly 54% identified themselves as middle level and 20% as top
level. Nearly 26% were of the lower level positions. The organizations having 10-100 employees
were nearly 36% whereas 38% had 100 to 1000 employees. It is different from the previous

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study of Hyvari(2006) in which 60% of the company/organizations had 100-1000 employees.
One interesting thing found was that almost 86% replied in positive that they were involved in
fully or partially during any decision making part of the project. It is in contrast to earlier studies
in which most of the managers replied in negative regarding the involvement in decision making.
CRITICAL SUCCESS FACTORS IN PROJECT MANGAMENT
This section deals with the important factors responsible for success in case of project based
organizations. These factors are divided into different dimensions viz. factors related to project,
the project manager, the project team, the project organization, the external environment and the
project tools and techniques. The questions were framed on a 5 point likert scale with options
ranging from least important to most important. The success factors have originated from the
study of Belasski & Tukel (1996) and Hyvari (2006). Some new factors have also been added
into them based on the pilot study and current review of the literature. The analysis is done in
SPSS and tables are imported from it. The ranks were calculated on the basis of the means. The
standard deviation and standard error mean have also been calculated for the analysis.
1. Factors related to the project
Ran
Std.
k Mean Deviation
adequate funds/resources
project having clear scope*
clear goals/objectives*
realistic schedule*
uniqueness of project
activities
density of project network
size and value of project

Std. Error
Mean

4
3
1
2

4.06
4.07
4.39
4.33

.881
.769
.751
.676

.075
.066
.064
.058

3.93

.871

.074

6
3

3.86
4.07

.979
.929

.084
.079

The most important critical factors in this study have been found to be clear coals/objectives,
realistic schedule and the project having a clear scope. In the study of Hyvari (2006) the three
factors were clear goals/objectives, end user commitment, and adequate funds/resources. The
earlier study of Fortune & White (2000) founded clear goals/objectives, support from senior
management and adequate funds/resources as most important success factor related to the project
whereas the study of Belasski & Tukel (1996) found size and value, density and urgency as the
most critical success factor related to the project. These results support the findings of the earlier
researchers in the project related factors. In this study clear goals and objectives remained at the
first position. Realistic schedule is at second position which emphasizes that it is necessary to
make a practical time chart to finish the project so that the project is completed in that time and it
may be called as a successful project.

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1. Factors Related to the project manager

Rank Mean
ability to delegate authority
ability to motivate
effective conflict resolution
ability to coordinate
Commitment*
Effective leadership*
Situational Management*
relevant experience
Competence*
perception of role and responsibility
efficient management of resources*
emotional intelligence

9
6
7
8
4
1
2
5
4
8
3
5

4.04
4.26
4.25
4.10
4.33
4.53
4.52
4.29
4.33
4.10
4.43
4.29

Std.
Deviation

Std. Error
Mean

.785
.728
.715
.656
.787
.665
.708
.749
.698
.770
.746
.850

.067
.062
.061
.056
.067
.057
.061
.064
.060
.066
.064
.073

The important factors related to the project manager were effective leadership, situational
management and his ability of efficient management of resources. In the earlier study done by
Hyvari (2006), the critical factors were commitment, ability to coordinate and effective
leadership. Another study done by Belasski & Tukel (1996) found the critical success factors as
commitment, ability to coordinate and competence. Situational management which was found to
be considered as the second most important factor was at fifth position in the study of Hyvari
(2006). Commitment and competence were ranked at the same fourth position by the
respondents. It is in contrast with the earlier studies in which it was ranked above the current
position. Emotional intelligence of project manager and relevant experience in the project were
also found critical for the success of project. The ranking of emotional intelligence signifies that
it is one area of human issues in project management which needs to be explored for its role in
achieving the success in projects. The ability to motivate which was ranked higher in earlier
study stood at sixth position in this study which signifies that practically people are involved
fully in the projects, and if earlier ranked above factors are taken care of , the chances of less
motivation are rare. One critical fact concluded from the study is that the effective leadership is
highly critical factor regarding the project manager characteristics.
The critical success factors related to project team members found in this study are proper
communication, commitment of the team and cooperation among the team members. These
findings match with studies of Hyvari (2006) and Belasski & Tukel (1996). The difference is in
the third rank which according to them was found to be technical background of the project
team. It has secured fourth rank in this study.

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2. Factors related to the Project Team

Name of factor

Rank

Mean

Std.
Deviation

3.92

.900

.077

4.01

.757

.065

3.64

.838

.072

4.00

.883

.075

3.53

1.036

.089

3.80

1.013

.087

4.12

.835

.071

Technical background of
project team
Commitment of the team*
Level of trust among team
members
Cooperation among members*
Ability to handle unexpected
crisis and deviations from plan
Effective monitoring and
feedback
Proper communication*

Std. Error
Mean

The most critical factors related to the organization found in this study are clear work definition
at first rank and top management support at the second rank. The third rank is occupied by
organization structure as well as degree of autonomy (new in this study). There was little
difference found between them and hence both are placed at same rank. In the study of Hyvari
(2006) top management support was found to be most important and it was followed by clear
organization/job descriptions and organization structure. Belasski & Tukel (1996) identified
organization structure as the most important followed by top management support and functional
managers support. On comparing the results of last three studies the results are almost same
except the entrance of a new factor of degree of autonomy. It indicates that people want to have
more freedom in performing the job as given to them. It creates a new area of research in this
direction where the role of autonomy should be studied in project success.
3. Factors related to the organization
Degree of autonomy*
Top management support*
Organization structure*
Functional managers support
Monitoring committee
Clear work definition*

Rank

Mean

Std. Deviation

Std. Error Mean

3
2
3
4
5
1

4.03
4.28
4.04
3.93
3.69
4.31

.664
.872
.999
.917
.937
.802

.057
.075
.085
.078
.080
.069

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4. Factors related to the environment

Competitors
Political environment
Economic environment
Social environment
Technological environment
Clients knowledge/experience*
Subcontractors
Regulatory Environment*
Clients type/size*
Infrastructural environment

Rank

Mean

Std.
Deviation

Std. Error
Mean

7
10
9
8
6
1
5
3
2
4

3.77
2.97
2.99
3.14
3.94
4.54
4.23
4.45
4.46
4.26

.918
1.366
1.372
1.351
.725
.675
.569
.717
.675
.676

.078
.117
.117
.115
.062
.058
.049
.061
.058
.058

The critical success factors related to the environment found in this study are clients
knowledge/experience, clients type/size and regulatory environment. The study of Hyvari (2006)
identified clients as the most critical success factor followed by the technological environment
and economic environment. Regulatory environment (new in this study) was found to be third
most critical success factor after clients type/size. One interesting thing that infrastructural
environment was placed at fourth position above the subcontractors in this study. Technological
environment which was at second rank in earlier study was at sixth rank in this study. This
difference may be due to continental difference and knowingness with tools and techniques
being used in the industry.
5. Factors related to tools and techniques

Proper planning/scheduling
*
Monitoring/ control*
Cost estimation/ budgeting
*
Adherence to procedures
Quality control
Risk analysis
Resource management *

Rank

Mean

Std.
Deviation

Std. Error
Mean

4.26

.686

.059

4.31

.784

.067

4.26

.807

.069

6
4
5
1

4.03
4.25
4.04
4.46

.831
.743
.790
.718

.071
.063
.067
.061

After the analysis of literature it was found that the factor related to tools & techniques should be
added as its role in determining the success has not been considered in the literature. These
factors were developed after discussion with the experts in the area. The most significant factor

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Global Business and Management Research: An International Journal (2011), Vol. 3 Nos. 3 & 4
found was resource management followed by monitoring & control. It is in line with the critical
qualities in project manager found above in the paper where efficient management of resources
was third most important factor. Proper planning and scheduling was at third place and was
considered equally important as cost estimation/budgeting. It was followed by quality control
and risk analysis.
Combined Ranking of factors

Project type
Project tools &
techniques*
Project manager*
Project organization
External environment
Project team*

Rank

Mean

Std.
Deviation

Std. Error
Mean

3.47

.805

.069

3.85

.702

.060

1
5
6

4.17
3.39
3.27

.959
.894
.752

.082
.076
.064

3.93

1.129

.096

Among the six classifications of critical factors the respondents were asked to rank them
according to their importance on the success of project. Survey identifies that project manager is
the most critical factor followed by the project team. It signifies that current research which has
focused more on project team than the dynamics of project manager should concentrate on
project manager variables and its role on achieving success. Tools and techniques being
employed in the project based organizations secured third rank. The survey identified the role of
project type as the fourth important success factor.
Validation of Hypothesis and relationship between variables
The results of survey validate the hypothesis of Ha1 to Ha6. The various factors identified had a
relation on the success of projects. The Pearson correlation was carried out in order to identify
the relationships among different variables. The age of project manager was highly correlated
with effective conflict resolution [.228 (Pearson correlation), .007 Sv (significant value)] and
effective leadership (.177, .038 sv). The functional managers support had a high correlation with
the top management support (.271, .001) and organization structure. The effective leadership had
a high correlation with the ability to motivate. The experience of the project managers was
correlated to proper planning/scheduling(.330, .000), monitoring& control (.246, .004) , clients
type & size (.235, .006) ,proper communication(.226, .008) , efficient management of resources(
.207, .015). Involvement in decision making had a high correlation with top management support
(.378, .001sv). It shows that those who were fully involved in decision making had top
management support with them. The position in the organization also had significant correlation
with the top management support and the degree of autonomy. The number of employee also had
correlation with adequate fund/resources which signifies that the bigger firms had availability of
funds with them to support the employees. The above results validate the hypothesis Hb.
Many success factors had negative correlation. For egample, the experience of project manager
had a negative correlation with the ability to co-ordinate which is a part of leadership trait. The
results were interesting to find and needs further research in this direction. The experience of the
managers had a low correlation with size and value of the project.

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Discussion
The paper presented the critical success factors in project based organizations in India. It was
aimed at identifying the factors in Indian context. It was based on the literature review done in
this area. The questionnaire was developed with help of earlier work of Fortune & white (2002)
and Hyvari (2006). The findings of this section above support some theories already expressed
by different authors as well as highlight some new trends, which could be considered while
determining the critical success factors in project based industries. This research finds the interrelationship between different variables affecting the success of project in an industry. The
findings support that different factors do not segregate from each other and are interdependent.
As a result while some may be affecting directly on the project success, others play a role
indirectly. The governance of human related success factors in the interrelation diagram
supports the findings of the previous section of this research regarding the importance of this
group. The results have proved that identified critical factors have a significant effect on the
project success. It has also revealed that majority of them are interrelated to each other in one or
another way. The study identifies the importance of project manager and the role of project team
members in achieving project success. The researchers in theory have laid the importance of
project manager which has been proved empirically by these findings. These results will help the
project based organizations to realize the key factors influencing the success of any project. It
will help them to formulate the right team with equipped skills for the project.
Conclusion & Further Research
The study verified the importance of the selected critical success factors that are related to the
efficiency of enterprises based on project. According to results, project success is associated with
project team management in the form of information availability (proper communication) and
commitment. The results concerning the selected critical success factors and the explanatory
power of model may be optimistic; as the sample represents people responsible for project
activities in their organizations. This study identifies the deficiency of empirical research about
project success in diverse organizational settings. The study aims at collecting empirical support
on the nature of the critical success/failure factors in organizations based on project conditions.
Various success factors were studied in context of organizational variables. The results state that
there is need to explore the human aspects in order to achieve success in project based
enterprises. The identification of emotional intelligence of project manager as a critical success
factor should be explored. The respondents identified effective leadership as a critical success
factor which is in line with the current ongoing research in human aspects of project
management. The emotional quotient needs to be mapped to achieve the success criteria. Proper
communication has been found a critical success factor in the success of a team. More research
needs to be done in this area to understand the communications suitable in project based context.
Secondly research in the direction of role of team in influencing the success in projects should be
explored. Resource management has been found critical tool to the success of the project. Future
research should be aimed at understanding how the resources influence the success context in
different organizations.
Further research is needed to identify the factors intensive (specific) for each project based
industry operating at different locations across the world. Since earlier researches as well as this
study has identified that the critical success factors change with time and place, it becomes
imperative to study the same. One interesting study will be to compare the factors in public
sector units with those of private sector units operating on project based existence. Since public
sector units operate with more government oriented approach as well as a social sense
responsibility, while private enterprises solely look for profit building, the study will be quite
interesting.

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Limitations of the study

The results of the study are of applicable to public as well as private organizations of the
country. Even then, the study has some limitations. Firstly, the study was based on information
collected from the project management professionals based in the India only regardless of their
gender, race, culture and status. Secondly the study focused on general project management
principles and practices which are not industry specific. Thirdly, the study does not attempt to
predict any definition of the project success parameters.
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Appendix

Corresponding Author
Piyush Mishra can be contacted at: piyushmishra_9@rediffmail.com

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