IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i2p960-d725363.html
   My bibliography  Save this article

Sustainable Project Management: Reducing the Risk of Cost Inaccuracy Using a PLS-SEM Approach

Author

Listed:
  • Ali Foroutan Mirhosseini

    (Department of Civil and Environmental Engineering, Norwegian University of Science and Technology, 7491 Trondheim, Norway
    Norwegian Public Roads Administration, 7075 Tiller, Norway)

  • Kelly Pitera

    (Department of Civil and Environmental Engineering, Norwegian University of Science and Technology, 7491 Trondheim, Norway)

  • James Odeck

    (Department of Civil and Environmental Engineering, Norwegian University of Science and Technology, 7491 Trondheim, Norway
    Norwegian Public Roads Administration, 0609 Oslo, Norway)

  • Morten Welde

    (Department of Civil and Environmental Engineering, Norwegian University of Science and Technology, 7491 Trondheim, Norway)

Abstract

Determining the factors leading to cost inaccuracy in infrastructure projects relates to sustainability by improving the cost performance of the projects (economic sustainability) and reducing the waste of available resources (environmental sustainability). This study investigates the effects of various factors affecting the cost performance of large-scale road projects in Norway in both the planning and construction phases. To this aim, a quantitative approach using a questionnaire survey was employed to understand the attitude of practitioners towards various factors causing cost increases. An advanced multivariate statistical approach of Partial Least Square Structural Equation Modeling (PLS-SEM) and Relative Importance Index (RII) was utilized to analyze the questionnaire responses. The results of the RII analysis show that local wishes, defective estimations, and long processing times had the most impact on the cost increase during the planning phase. At the same time, scope changes, market conditions, and unforeseen ground conditions were the most influential parameters in the construction phase. Moreover, the results obtained from PLS-SEM reveal that external related factors had the most influence among the other grouped factors (i.e., pre-construction, project management and contractual relationship, contractor’s site management, and external) on cost overrun during the construction phase. Increasing the knowledge of these factors will allow for developing relevant project management approaches targeted at improving economic and environmental sustainability within both the planning and construction phases.

Suggested Citation

  • Ali Foroutan Mirhosseini & Kelly Pitera & James Odeck & Morten Welde, 2022. "Sustainable Project Management: Reducing the Risk of Cost Inaccuracy Using a PLS-SEM Approach," Sustainability, MDPI, vol. 14(2), pages 1-20, January.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:2:p:960-:d:725363
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/2/960/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/2/960/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Silvia Martínez-Perales & Isabel Ortiz-Marcos & Jesús Juan Ruiz & Francisco Javier Lázaro, 2018. "Using Certification as a Tool to Develop Sustainability in Project Management," Sustainability, MDPI, vol. 10(5), pages 1-18, May.
    2. James Odeck, 2019. "Variation in cost overruns of transportation projects: an econometric meta-regression analysis of studies reported in the literature," Transportation, Springer, vol. 46(4), pages 1345-1368, August.
    3. Cantarelli, C.C. & van Wee, B. & Molin, E.J.E. & Flyvbjerg, B., 2012. "Different cost performance: different determinants?," Transport Policy, Elsevier, vol. 22(C), pages 88-95.
    4. Rocío Rodríguez-Rivero & Isabel Ortiz-Marcos & Luis Ballesteros-Sánchez & Xabier Martínez-Beneitez, 2020. "Identifying Risks for Better Project Management between Two Different Cultures: The Chinese and the Spanish," Sustainability, MDPI, vol. 12(18), pages 1-14, September.
    5. Diego F. Uribe & Isabel Ortiz-Marcos & Ángel Uruburu, 2018. "What Is Going on with Stakeholder Theory in Project Management Literature? A Symbiotic Relationship for Sustainability," Sustainability, MDPI, vol. 10(4), pages 1-23, April.
    6. Rocío Rodríguez-Rivero & Isabel Ortiz-Marcos & Javier Romero & Luis Ballesteros-Sánchez, 2020. "Finding the Links between Risk Management and Project Success: Evidence from International Development Projects in Colombia," Sustainability, MDPI, vol. 12(21), pages 1-19, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rubén Dario Acosta-Velásquez & Jeffrey León-Pulido & Alexander García-Pérez & William Stive Fajardo-Moreno & Leonardo Espinosa-Leal, 2022. "Contemporary Management Practice Applying the Dynamic Absorptive Capacity Measurement Model (PM 4 AC) for Improved Business Sustainability," Sustainability, MDPI, vol. 14(17), pages 1-12, September.
    2. Maria Krechowicz, 2022. "Towards Sustainable Project Management: Evaluation of Relationship-Specific Risks and Risk Determinants Threatening to Achieve the Intended Benefit of Interorganizational Cooperation in Engineering Pr," Sustainability, MDPI, vol. 14(5), pages 1-24, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Abeysekara, Baudhi & Perera, Piyaruwan & Chhipi Shrestha, Gyan Kumar & Gunaruwan, Lalithasiri & Kumarage, Amal & Sadiq, Rehan & Hewage, Kasun, 2021. "Improving the capital deployment efficiency: An infrastructure investment planning process in transportation project," Research in Transportation Economics, Elsevier, vol. 88(C).
    2. Rocío Rodríguez-Rivero & Isabel Ortiz-Marcos & Luis Ballesteros-Sánchez & Xabier Martínez-Beneitez, 2020. "Identifying Risks for Better Project Management between Two Different Cultures: The Chinese and the Spanish," Sustainability, MDPI, vol. 12(18), pages 1-14, September.
    3. Verweij, Stefan & Meerkerk, Ingmar van, 2020. "Do public-private partnerships perform better? A comparative analysis of costs for additional work and reasons for contract changes in Dutch transport infrastructure projects," Transport Policy, Elsevier, vol. 99(C), pages 430-438.
    4. Andri Ottesen & Dieter Thom & Rupali Bhagat & Rola Mourdaa, 2023. "Learning from the Future of Kuwait: Scenarios as a Learning Tool to Build Consensus for Actions Needed to Realize Vision 2035," Sustainability, MDPI, vol. 15(9), pages 1-25, April.
    5. Stefano Armenia & Rosa Maria Dangelico & Fabio Nonino & Alessandro Pompei, 2019. "Sustainable Project Management: A Conceptualization-Oriented Review and a Framework Proposal for Future Studies," Sustainability, MDPI, vol. 11(9), pages 1-16, May.
    6. Montserrat Boronat-Navarro & José A. Pérez-Aranda, 2020. "Analyzing Willingness to Pay More to Stay in a Sustainable Hotel," Sustainability, MDPI, vol. 12(9), pages 1-17, May.
    7. Verweij, Stefan & van Meerkerk, Ingmar & Korthagen, Iris A., 2015. "Reasons for contract changes in implementing Dutch transportation infrastructure projects: An empirical exploration," Transport Policy, Elsevier, vol. 37(C), pages 195-202.
    8. Love, Peter E.D. & Zhou, Jingyang & Edwards, David J. & Irani, Zahir & Sing, Chun-Pong, 2017. "Off the rails: The cost performance of infrastructure rail projects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 99(C), pages 14-29.
    9. Chong, Uven & Hopkins, Omar, 2016. "An international experience on the evolution of road costs during the project life cycle," Transport Policy, Elsevier, vol. 48(C), pages 60-66.
    10. Jarosław Górecki & Manuel Díaz-Madroñero, 2020. "Who Risks and Wins?—Simulated Cost Variance in Sustainable Construction Projects," Sustainability, MDPI, vol. 12(8), pages 1-31, April.
    11. Jaroslav Vrchota & Petr Řehoř & Monika Maříková & Martin Pech, 2020. "Critical Success Factors of the Project Management in Relation to Industry 4.0 for Sustainability of Projects," Sustainability, MDPI, vol. 13(1), pages 1-19, December.
    12. Filippi, Maryline & Chapdaniel, Alain, 2018. "Adding Value to Sustainable Agri-Food Chains: Experimentation in the Pork Sector," 166th Seminar, August 30-31, 2018, Galway, West of Ireland 276199, European Association of Agricultural Economists.
    13. Wei Li-Yao & Fotios Misopoulos, 2020. "Integrating Sustainability in Project Management: Implications in Manufacturing Industry," International Journal of Business and Administrative Studies, Professor Dr. Bahaudin G. Mujtaba, vol. 6(1), pages 31-50.
    14. Kristijan Robert Prebanić & Mladen Vukomanović, 2021. "Realizing the Need for Digital Transformation of Stakeholder Management: A Systematic Review in the Construction Industry," Sustainability, MDPI, vol. 13(22), pages 1-27, November.
    15. Miranda Sarmento, J.J. & Renneboog, Luc, 2017. "Cost overruns in public sector investment projects," Other publications TiSEM 51799a3e-4c78-4dbd-b330-b, Tilburg University, School of Economics and Management.
    16. Flyvbjerg, Bent & Ansar, Atif & Budzier, Alexander & Buhl, Søren & Cantarelli, Chantal & Garbuio, Massimo & Glenting, Carsten & Holm, Mette Skamris & Lovallo, Dan & Lunn, Daniel & Molin, Eric & Rønnes, 2018. "Five things you should know about cost overrun," Transportation Research Part A: Policy and Practice, Elsevier, vol. 118(C), pages 174-190.
    17. Johan Larsson & Per Erik Eriksson & Thomas Olofsson & Peter Simonsson, 2014. "Industrialized construction in the Swedish infrastructure sector: core elements and barriers," Construction Management and Economics, Taylor & Francis Journals, vol. 32(1-2), pages 83-96, February.
    18. Dejan Makovšek & Marian Moszoro, 2018. "Risk pricing inefficiency in public–private partnerships," Transport Reviews, Taylor & Francis Journals, vol. 38(3), pages 298-321, May.
    19. Amin Khalifeh & Ahmad Samed Al-Adwan & Mohammed Kasem Alrousan & Husam Yaseen & Belal Mathani & Firas Rashed Wahsheh, 2023. "Exploring the Nexus of Sustainability and Project Success: A Proposed Framework for the Software Sector," Sustainability, MDPI, vol. 15(22), pages 1-18, November.
    20. Sareh Rajabi & Sameh El-Sayegh & Lotfi Romdhane, 2024. "Project Controls Model for Sustainable Construction Projects," Sustainability, MDPI, vol. 16(20), pages 1-25, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:2:p:960-:d:725363. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.