Exploring critical success factors for stakeholder management in construction projects/Kritiniu sekmes veiksniu suinteresuotuju saliu valdymui statybos projektuose tyrimas.
Yang, Jing ; Shen, Geoffrey Qiping ; Ho, Manfong 等
1. Introduction
An increasing number of studies (Newcombe 2003; Olander and Landin
2005; El-Gohary et al. 2006) have identified the importance of
stakeholder management in construction projects. However, the
construction industry has a poor record of stakeholder management during
the past decades (Loosemore 2006) owing to the complexity and
uncertainty of projects. Many problems of stakeholder management in
construction projects proposed by previous scholars include inadequate
engagement of stakeholders, project managers having unclear objectives
of stakeholder management, difficulty to identify the
"invisible" stakeholder, and inadequate communication with
stakeholders (Pouloudi and Whitley 1997; Loosemore 2006; Bourne and
Walker 2006; Rowlinson and Cheung 2008). In order to solve these
problems, project teams need to know what the essentials are for
managing stakeholders (Cleland and Ireland 2002).
To identifying the essentials of stakeholder management, Critical
Success Factors (CSFs) approach is used in this study. This approach was
first developed by Rockart (1979). CSFs can be defined as "areas,
in which results, if they are satisfactory, will ensure successful
competitive performance for the organisation" (Rockart 1979).
Saraph et al. (1989), viewed them as "those criti cal areas of
managerial planning and action that must be practised in order to
achieve effectiveness". Many researchers (e.g. Chan et al. 2001;
Jefferies et al. 2002; Yu et al. 2006) have used this method as a means
to improve the performance of the management process. In the field of
stakeholder management, Cleland and Ireland (2002) consider important
that the project team should know whether or not it is successfully
"managing" the project stakeholders. In this paper, CSFs are
viewed as those activities and practices that should be addressed in
order to ensure effective management of stakeholders.
The review of the literature suggested that there are numerous CSFs
that can be identified as being crucial to the successful implementation
of stakeholder management. Jergeas et al. (2000) identified 2 aspects of
improvements for managing stakeholders, which are: "communication
with stakeholders and setting common goals, objectives and project
priorities". Landin (2000) considers "the longterm performance
of any construction and its ability to satisfy stakeholders"
depends on decisions made and the care taken by decision-makers in
stakeholder communication. Aaltonen et al. (2008) state that the key
issue in project stakeholder management is managing the relationship
between the project and its stakeholders. These proposed factors may be
the critical successful factors for stakeholder management in
construction projects, but most of these studies are descriptive
reviews, lack detailed quantitative analysis and fail to prioritize the
relative importance of those success factors. In addition, as suggested
by Aksorn and Hadikusumo (2008), these factors need to be grouped so
that "few and essential CSFs representing a wide variety of issues
can be revealed".
[FIGURE 1 OMITTED]
In this regard, it is crucial to explore the relative importance
and groupings of factors that are significantly important for
stakeholder management in construction projects. Therefore, this paper
aims to identify and quantitatively prioritize CSFs associated with
stakeholder management in construction projects of Hong Kong, and group
the factors into lesser dimensions by using factor analysis.
2. Research methodology
The specific methodology of this study is based on a literature
review, 6 face-to-face interviews, a pilot study and a questionnaire
survey (Fig. 1). The research flow follows the procedure in the studies
of Walker (1997) and Chan et al. (2004).
3. An overview of CSFs for stakeholder management
Factors contributing to the success of stakeholder management in
construction projects are first identified by previous studies on this
subject. Eight top journals (Construction Management and Economics,
Journal of Construction Engineering and Management, Engineering
Construction and Architectural Management, Journal of Management in
Engineering, International Journal of Project Management, Automation in
Construction, Project Management Journal and Building Research and
Information) and 4 search engines (Google Scholar, ABI database, EI
CompendexWeb, and ISI web of knowledge) were searched by using the
keywords of "stakeholder", "project participants",
or "project environment". These different sources were tried
with the aim of finding the publications about stakeholder management in
construction sector as complete as possible, and make a comprehensive
review on the captioned topic. The first selection of publications was
from abstracts if they were available, and the second selection made
after reading the specific documents. In total, 68 publications with
respect to stakeholder issues in construction sector remained for
analysis at last. The publications consist of journals papers,
international conference papers, theses, booklets, reports and some
chapters in 8 books.
These publications were reviewed to derive CSFs for stakeholder
management in construction projects theoretically. CSFs can also be
identified from studies on stakeholder management in general or
"the works of those who have addressed a particular factor in
detail" (Wong and Aspinwall 2005). An in depth literature review
indicated that numerous factors had been identified as important for
stakeholder management. Although different terminologies were used in
different studies to indicate factors, they can be represented by
generic themes (Wong and Aspinwall 2005). Based on the literature
review, 15 factors contributing to the success of stakeholder management
in construction projects are hypothesized and proposed. These are as
follows:
Undertaking social responsibilities
Wood, Gray (1991) believes the stakeholder theory is the theory
most often associated with corporate social responsibility, as
stakeholders are central to the very concept of corporate social
performance. Carroll (1991) suggests, there is a natural fit between the
ideas of corporate social responsibility and an organization
stakeholders, as the stakeholder concept personalizes social
responsibilities by delineating specific groups or persons that business
should consider in its corporate social responsibility orientations and
activities. Donaldson and Preston (1995) presented taxonomy of
stakeholder theory types--normative, instrumental, and descriptive--and
used the taxonomy to guide their discussion on the stakeholder
literature. They suggest the central core to stakeholder theory is the
normative approach, which implies that "organizations should
acknowledge the validity of diverse stakeholder interests and should
attempt to respond to them within a mutually supportive framework
because it is a moral requirement". According to Carroll's
definition (1979), social responsibility encompasses "the economic
(the obligation to produce goods and services, sell them at fair prices
and make a profit), legal (obligation to obey the law), and ethical
(issues not embodied in law but expected by society) expectations that
society has of organizations at a given point in time". Recently
environmental expectation has also been paid a high attention by lots of
scholars (e.g. AlWaer et al. 2008; Prager and Freese 2009) for
sustainability reasons. The environmental consideration includes air,
flora/fauna, dust, water, and noise, and the purpose is to protect
environment. As discussed above, scholars have studied social
responsibilities of stakeholder management from these 4 perspectives:
economic (El-Sawah 2006), legal (Radin 2002; Crow 2008), environmental
(AlWaer et al. 2008; Reed 2008; Prager and Freese 2009), and ethical
(Phillips 2003; Moodley et al. 2008; Smyth 2008). Therefore, project
managers should try to manage stakeholders with corporate social
(economic, legal, environmental and ethical) responsibilities (Yang et
al. 2008).
Defining project missions
The identification of a clear mission for the projects at different
stages is widely considered to be essential for the effective management
of stakeholders (Winch 2000). Before every activity of stakeholder
management, the project manager should have a better understanding of
the tasks and objectives at a particular stage of the project lifecycle,
including the issues of cost, schedule, budget, etc. The complexity of
client organizations and the social, economic, and regulatory
environment in which the projects operate means that "the strategic
definition of the project mission is inevitably politicized" (Winch
2000). Using interviews, Jergeas et al. (2000) proved further that
"setting common goals, objectives and project priorities" is
significant for improving stakeholder management.
Identifying stakeholders
Most of scholars studying stakeholder management
(Karlsen 2002; Olander 2006; Walker et al. 2008; Jepsen
and Eskerod 2008) have pointed out the significant importance of
identifying stakeholders. Though the project stakeholders can be divided
into different types according to various criteria (Pinto 1998), the
question of "who are stakeholders?" (Frooman 1999) should be
answered first before classifying and managing stakeholders.
Understanding the area of stakeholders' interests
There are various stakeholders' interests due to the complex
nature of construction projects (Cleland 1999). Freeman et al. (2007)
believe that identifying stakeholder interests is an important task to
assess stakeholders, and they listed stakeholders' interests
including product safety, integrity of financial reporting new product
services, and financial returns. Similarly, Karlsen (2002) also presents
one possible consideration to evaluate stakeholders "his or her
area of interests in the project".
Exploring stakeholders' needs and constraints in projects
Exploring stakeholders' needs and constraints in projects
means to anatomize stakeholders' area of interests and list the
detailed issues stakeholders' concerns (Freeman et al. 2007).
During the project process, all stakeholders' needs should be
assessed "so that a satisfactory and realistic solution to the
problem being addressed is obtained" (Love et al. 2004).
Homoplastically, Kocak (2003) clarifies that stakeholders' needs
can provide an indication of the stakeholder groups' concerns, the
problems the project team faces, and stakeholders' requirements of
the projects. Further more, Olander and Landin (2008) also proved the
importance of "analysis of stakeholder concerns and needs" by
case studies in Sweden.
Assessing stakeholders' behaviour
The capacity and willingness of stakeholders to threaten or
cooperate with project teams should be measured (Savage et al. 1991)
during stakeholder management process. Stakeholders' behaviour can
be sorted into 3 categories: observed behaviour, cooperative potential,
and competitive threat (Freeman 1984). Freeman et al. (2007) state that
project managers need to clearly understand the range of stakeholder
reactions and behaviours. By studying a pulp mill construction project
in Uruguay, Aaltonen et al. (2008) identified 8 different
stakeholders' behaviours/strategies employed to shape salience
attributes. This study further demonstrates the significance of
assessing stakeholders' behaviours.
Predicting the influence of stakeholders
Project management procedure is affected by project stakeholders
(Olander 2007). Therefore recognizing the stakeholders' influence
is important to "plan and execute a sufficiently rigorous
stakeholder management process" (Olander and Landin 2005). Olander
(2007) developed the "stakeholder impact index", and he
considers that analyzing the potential impact of stakeholders indicates
to determine the nature and impact of stakeholder influence, the
probability of stakeholders exercising their influence and each
stakeholder's position in relation to the project.
Assessing attributes of stakeholders
The attributes of stakeholders need to be assessed by project teams
properly (Mitchell et al. 1997; Bourne 2005). Mitchell et al. (1997)
proposed 3 attributes in their study, namely, power, urgency, and
legitimacy. Power means the ability to "control resources, create
dependencies, and support the interests of some organization members or
groups over others" (Mitchell et al. 1997). Bourne and Walker
(2005) believe that successful project managers should have the ability
to understand the "invisible power" among stakeholders.
Urgency is "the degree to which stakeholder claims call for
immediate attention" (Mitchell et al. 1997). Legitimacy is "a
generalized perception or assumption that the actions of an entity are
desirable, proper, or appropriate within some socially constructed
system of norms, values, beliefs, and definitions" (Suchman 1995).
Bourne (2005) considers the proximity as an important attribute of
stakeholders, which can be rated from "directly working in the
project" to "remote from the project". Analyzing and
estimating these 3 attributes enhance the understanding of project
managers on stakeholders.
Analyzing conflicts and coalitions among stakeholders
Conflict occurs whenever disagreements exist in a social situation
(Schermerhorn et al. 2003). Analyzing the conflicts and coalitions among
stakeholders is an important step for stakeholder management (Freeman
1984). Types of conflict include "substantive conflict and
emotional conflict" (Schermerhorn et al. 2003). Project managers
should know the potential conflicts stemming from divergent interests
(Frooman 1999). Project managers should also search for possible
coalitions among stakeholders. This concept comes from Freeman's
strategy model (Freeman 1984). He believes the groups, who share
objectives, stakeholders or interests about the project, can be more
likely to form coalitions.
Compromising conflicts
Since there are various conflicts among stakeholders, compromising
these conflicts become important for project managers to make decisions
(Freeman 1984). A positive relationship between conflict resolution and
satisfaction of stakeholders has been confirmed by Leung et al. (2005)
with a questionnaire survey. How to make a "multi-win"
compromise solution is a problem faced by project teams (Bana e Costa et
al. 2001).
Promoting a good relationship
Successful relationships between the project and its stakeholders
are vital for successful delivery of projects and meeting stakeholder
expectations (Cleland 1986; Savage et al. 1991; Jergeas et al. 2000;
Hartmann 2002). Trust and commitment among stakeholders can be built and
maintained by an efficient relationships management (Pinto 1998; Bourne
2005; Karlsen et al. 2008).
Formulating appropriate strategies
Schwager (2004) points out that the central question of stakeholder
management was "what are the strategies that organizations use to
address stakeholders?". Similar result is obtained by Karlsen
(2002) from a survey; he stated that there are different types of the
strategies, but basically the stakeholder management strategy is the
attitude how the project management team treats different stakeholders.
In order to identify different kinds of strategies which are enacted by
organizations as responses to the demands presented by external
stakeholders, through an empirical analysis of 4 different projects,
Aaltonen and Sivonen (2009) explained the use and emergence of the
"response strategies". All these scholars have proved the
importance of formulating appropriate strategies to deal with
stakeholders.
Predicting stakeholders' reactions
'Stakeholders' reactions to the strategies' is an
important factor when project managers make decisions about strategies
to deal with stakeholders (Freeman et al. 2007). Attention to
stakeholder response is also paid by Dias (1999). By applying fuzzy set
method, he emphasized his studies on the feasibility and acceptability
of strategies for stakeholders. Therefore, a project team should proceed
to predict stakeholder behaviour in implementing strategy (Cleland and
Ireland 2002).
Analyzing the change of stakeholders
The concepts of the change and dynamics of stakeholders were
acknowledged by Freeman (1984). According to him, in reality
stakeholders and their influence change over time, and this depends on
the strategic issue under consideration. Dynamics of stakeholder is a
very interesting and important aspect of the stakeholder concept (Elias
et al. 2002). The uncertainty caused by stakeholders includes "who
the stakeholders are", the influence of them, their needs, and the
implications of relationships among stakeholders (Ward and Chapman
2008).
Ensuring effective communication
Communication is essential for maintaining the support and
commitment of all stakeholders (Briner et al. 1996). Effective, regular,
and planned communication with all members of the project community is
necessary for project success (Briner et al. 1996; Cleland 1995). In
addition, Weaver (2007) believes project managers should be highly
skilled negotiators and communicators capable of managing individual
stakeholder's expectations and creating a positive culture change
within the overall organization.
4. Interviews and pilot study
Since the 15 CSFs were identified in the literature review, they
should be further confirmed by professionals of construction industry
before developing the questionnaire instrument. The preliminary list of
CSFs was presented to 6 industrial experts during face-to-face
interviews. These experts were selected because they all had more than
10 years overall experience in stakeholder management of construction
projects, and they played different roles in projects and on different
levels of position (Table 1). The interviews were conducted in the
interviewees' office, and lasted for 0.5 to 1 hour, depending on
the interviewees' available time slots and how many comments they
gave. All interviewees agreed that the proposed 15 factors were critical
and comprehensive, and meanwhile some interviewees provided valuable
comments on the scope and language of factor statement. For example, the
first factor was changed from "Undertaking social
responsibilities" to a more detailed description "Managing
stakeholders with social responsibilities (economic, legal,
environmental and ethical)"; the last factor was changed from
"Ensuring effective communication" to "Communicating with
and engaging stakeholders properly and frequently", since the
interviewees thought "engaging stakeholders" should be
emphasised. Another important comment is that regarding the attributes
of stakeholders, the interviewees thought that the attribute of
legitimacy is imprecise and difficult to operationalize, and they all
preferred using the attribute "proximity", which is easier to
explain. Considering this comment, and also since the definition of
legitimacy is more related with the "norma tive core" for
stakeholder theory (Mitchell et al. 1997), which has been considered in
the factor about social responsibilities, legitimacy is not included as
stakeholders' attributes. These comments were significant for
questionnaire development since they promoted description of the factors
for better comprehension. The first version of the questionnaire was
developed after these interviews.
Prior to sending to questionnaires, a pilot study was conducted.
Two project managers, one is client representative and the other is a
contractor, were prompted to answer the preliminary questionnaire. The
aim of the pilot study was to pre-test the suitability and
comprehensibility of the questionnaire. There were no adverse comments
proposed, so the finalized questionnaire is the same as that of the
first version. The statements of the 15 CSFs are as follows:
C1. Managing stakeholders with social responsibilities (economic,
legal, environmental and ethical);
C2. Formulating a clear statement of project missions;
C3. Identifying stakeholders properly;
C4. Understanding area of stakeholders' interests;
C5. Exploring stakeholders' needs and constraints to projects;
C6. Assessing stakeholders' behaviour;
C7. Predicting the influence of stakeholders accurately;
C8. Assessing attributes (power, urgency, and proximity) of
stakeholders;
C9. Analyzing conflicts and coalitions among stakeholders;
C10. Compromising conflicts among stakeholders effectively;
C11. Keeping and promoting good relationships; C12. Formulating
appropriate strategies to manage stakeholders;
C13. Predicting stakeholders' reactions for implementing the
strategies;
C14. Analyzing the change of stakeholders' influence and
relationships during the project process;
C15. Communicating with and engaging stakeholders properly and
frequently.
5. Design and administration of the questionnaire survey
The questionnaire comprises 4 sections: background information of
the respondents; opinions of respondents on stakeholder management; key
issues about stakeholder management; comments about the questionnaire.
Although the questionnaire survey dealt with various issues relating to
stakeholder management in construction projects, this paper only
presents the analysis results of the relative importance and groupings
of the identified 15 CSFs.
The questionnaire survey was undertaken in Hong Kong in August
2008, and the target of this survey was project managers from different
organizations in the construction industry. The information about
project managers, including their name, phone, email and mail address,
was collected randomly from the Internet, newspapers, magazines, the
membership lists of 2 institutes (the Association for Project Management
Hong Kong, and the Hong Kong Construction Association), and the register
lists published by the Buildings Department of Hong Kong. 654
questionnaires were delivered to the potential respondents by mail and
email. Respondents were requested to rate their degree of agreement
against each of the identified CSFs according to a five-point Likert
scale (1 = Strongly Disagree and 5 = Strongly Agree) with reference to a
particular project they had been involved in. About 3 weeks were given
to the respondents to complete and return it. The ways for retrieving it
include mail, email and fax. 183 completed questionnaires were received
consisting of 81 respondents from client organizations, 45 from
contractors companies, and 57 from consultant organizations. The
response rate was 28%, which was consistent with "the norm of
20-30% with most questionnaire surveys in the construction
industry" (Akintoye 2000).
6. Data analysis and key findings
The obtained raw data were inputted and analysed with the aid of
the Statistical Package for Social Sciences (SPSS) computer software.
Three types of analysis were conducted. These methods had been used by
other similar survey studies carried out by Akintoye (2000), Chan et al.
(2004), Wong and Aspinwall (2005), and Aksorn and Hadikusumo (2008).
According to Pallant (2001), only when the parametric assumptions
(normal distribution and homogeneity of variance) are fulfilled, the
matched parametric testing methods can be employed. Since those
assumptions are not fulfilled in this survey, the parametric methods
were not used. The process of data analysis is as follows.
First, the relative importance of the 15 CSFs was explored based on
responses. This type of scale has been found to be acceptable in several
construction management researches (e.g. Wang et al. 1999; Chan et al.
2003; Li et al. 2005). Kendall's Coefficient of Concordance was
calculated for measuring the agreement of respondents on their rankings
of CSFs. The Spearman's rank correlation test was used to examine
the general similarity on the rankings of CSFs between respondents from
client, contractor and consultant companies.
Second, a factor analysis was used to determine the underlying
relationships among the 15 CSFs. The principal component analysis for
factor extraction was applied to categorize the CSFs into a fewer number
of groupings.
Third, since Wong and Aspinwall (2005) have pointed out that
validating and refining the CSFs is important for data analysis,
reliability and validity tests of the raw data were conducted depending
on the overall data and results of factor analysis.
6.1. Ranking of CSFs
The analysis of the survey response data produced the means for the
15 CSFs ranging from 3.80 to 4.43, which indicated that all respondents
consider these 15 factors critical for stakeholder management in
construction projects. Ranking and Kendall's coefficient of
concordance for the CSFs are shown in Table 2. The highest ranking by
all respondents was "managing stakeholders with social
responsibilities (economic, legal, environmental and ethical)"
(mean = 4.43), which therefore was considered as an extremely
influential factor to the success of stakeholder management.
"Exploring stakeholders' needs and constraints to
projects" and "communicating with and engaging stakeholders
properly and frequently" (mean = 4.26) were both ranked as the
second most influential factors. The 4th ranked factor was
"understanding area of stakeholders' interests" (mean =
4.22), whereas the 5th ranked factor was "identifying stakeholders
properly" (mean value = 4.21); the 6th factor was "keeping and
promoting a good relationship" (mean value = 4.17). These 6 factors
were the top six CSFs for stakeholder management in construction
projects of Hong Kong. In addition, it is worth noting, that all
respondents perceived "predicting stakeholders' reactions for
implementing the strategies", "analyzing the change of
stakeholders' influence and relationships during the project
process" and "assessing stakeholders' behaviour" as
the 3 least influential factors.
In order to examine whether the respondents ranked the 15 CSFs in a
similar order, Kendall's coefficient of concordance was calculated.
According to Yeung et al. (2007), if the concordance coefficient is
equal to 1, it means that all the respondents rank the CSFs identically;
in contrast, if the concordance coefficient is equal to 0, it means that
all the respondents rank the CSFs totally differently. The
Kendall's coefficient of concordance for ran king the 15 CSFs in
Table 2 was 0.122, which was statistically significant at 1% level. This
suggested that there was a general agreement among 183 respondents on
ranking the 15 CSFs; that is, the respondents shared similar values
about the relative importance of these 15 CSFs. In order to examine the
general similarity on the rankings of CSFs between respondents from
client, contractor and consultant companies, the Spearman's rank
correlation test was used to show whether or not the similarities are
significant (Singh and Tiong 2006). The results of this test were
interpreted by correlation coefficients (r). The value of these
coefficients indicates the strength of the correlation between 2
variables. If r is significant at 5% level, this means the 2 variables
have a strong correlation. Table 3 shows the correlation coefficients
(r) of different pairs of respondents, i.e. r is 0.624 between
respondents from client and contractor companies. These statistical
results indicate a general consensus on the rankings of the CSFs among
different groups of respondents; therefore, no matter the respondents
from client, contractor or consultant companies, they rank the 15 CSFs
similarly in general.
6.2. Factor analysis of the CSFs
Norusis (1992) and Li et al. (2005) state that "factor
analysis is used to identify a relatively small number of factor
groupings that can be used to represent relationships among sets of many
inter-related variables". In this survey, this method was used to
determine the groupings of the 15 CSFs.
According to Pallant (2001), 2 main issues have to be considered in
determining whether a data set is suitable for factor analysis: sample
size and the strength of the relationship among the factors. In terms of
sample size, Nunnalyy (1978) recommends a 10 to 1 ratio; that is,
"10 cases for each item to be factor analysed". The minimum
number for factor analysis suggested by Pallant (2001) is 150. There
were 15 factors in this survey, so according to Nunnalyys'
recommendation (1978), 150 respondents should be obtained. Actually 183
respondents have been obtained in this study. The number was larger than
150. Therefore, the sample size was enough for factor analysis. In terms
of the strength of relationship among the factors, the correlation
matrix (Tabachnik and Fidell 1996), the Bartlett's test of
sphericity (Bartlett 1954), and the Kaiser-MeyerOlkin (KMO) (Kaiser
1970) were recommended. Most values in the correlation matrix are larger
than 0.3, the Bartlett's test of sphericity is significant
(p<0.05), and the value of the KMO index is above 0.6, suggesting the
data set is suitable for factor analysis. In this survey, more than a
half of the correlation coefficients (Table 4) were above 0.3, the
Bartlett's test of sphericity was significant (p<0.05) (Table
5), and the value of the KMO index was 0.870 (above 0.6) (Table 5). The
results of these tests confirmed that the data were appropriate for
factor analysis.
A 4-component solution was produced based on Varimax rotation of
principal component analysis (Table 6). These 4 factor groupings with
eigenvalues greater than 1.000 explain 61.532% of the variance. Each of
the CSFs belonged to only one of the groupings, with the value of factor
loading exceeding 0.50 (Norusis 1992; Li et al. 2005; Aksorn and
Hadikusumo 2008). It was noticed that C1 "Managing stakeholders
with social responsibilities (economic, legal, environmental and
ethical)" do not belong to any of the factor groupings. The
residual 14 CSFs can be grouped into 4 principal components, and the
corresponding importance ranking of the extracted components was: (1)
stakeholder estimation, (2) information inputs, (3) decision-making, and
(4) sustainable support.
Component 1: stakeholder estimation
This component, which accounted for 37.44% (Table 6) of the total
variances between critical success factors, was relatively more
important than the other 3 components. It indicated that project
managers in Hong Kong consider estimating stakeholders significant for
stakeholder management in construction projects. To enhance the
understanding of project managers on stakeholders, their attributes,
behaviour, and potential influence need to be assessed and estimated.
The conflicts and coalitions among stakeholders also could be analysed
based on the information about stakeholders. Therefore, this component,
which relates to estimate stakeholders, could be illustrated by C8, C6,
C7, and C9.
Component 2: information inputs
This component ranked second among the 4 components (Table 6). Four
CSFs comprise the elements of this component regarding information
input. Before any management activities, comprehensive information about
the project and stakeholders around it needs to be obtained. The
information includes project missions, full list of stakeholders, area
of stakeholders' interests, and their needs and constraints to the
project. The stakeholders could be managed depending on these inputs.
Component 3: Decision-making
Three CSFs were included in this component relating to
decision-making. Project managers have the responsibility to compromise
conflicts among stakeholders, and formulate appropriate strategies to
manage stakeholders. During the process of decision-making, project
managers always try to predict the reaction of stakeholders and choose
the optimal solution for managing stakeholders.
Component 4: Sustainable support
Though this component ranked least among the 4 components (Table
6), it is indispensable for stakeholder management. The reason is that
if the first 3 components could be considered as factors regarding one
management process, this fourth component is related to the
sustainability of stakeholder management. Construction projects are
transient (Bourne 2005), but organizations are correspondingly
permanent. Since many stakeholders, such as government, local
communities and media, would be involved at later stages of the project
process or in future projects, project managers, as the representatives
of different organizations, have the responsibility to realize the
change of their influence and relationships, promote a steady
relationship with them, and communicate with them properly and
frequently.
6.3. Validation of the CSFs
Testing for reliability of a scale Cronbach's Coefficient
Alpha was used to examine internal consistency of the scales under the
headings of the CSFs. Alpha values greater than 0.7 are regarded as
sufficient (Pallant 2001). The results of Cronbach's Coefficient
Alpha in this survey were in the range of 0.8625 to 0.8763. This
provides evidence mat all tne tactors nave a mgn internal consistency
and are reliable.
Testing for content validity
Ahire et al. (1996) believe that if the measurement items in the
survey "adequately cover the content domains or aspects of the
concept being measured", an instrument has content validity.
Gotzamani and Tsiotras (2001), Wong and Aspinwall (2005) also have
clarified that "it is not assessed numerically, but can only be
subjectively judged by the researchers". As discussed in Section 3,
the CSFs listed in this survey were identified by a comprehensive review
of relevant literature and validated by several interviews and pilot
studies with the professionals in the construction industry. Therefore,
it was believed that the whole questionnaire has valid contents.
Testing for construct validity
Construct validity was used to check for unifactoriality
(Black and Porter 1996). Antony et al. (2002) clarified that
"unifactoriality means that a single factor is extracted for
each test". Each factor grouping was evaluated by factor analysis
for construct validity. Table 7 presents results of the unifactorial
test. Since all of the KMO value were greater than 0.5, and the
percentage of variance explained by each component was more than 56 %,
all 4 components were demonstrated to be unifactorial.
Results of the 3 tests
Since all the factors have high internal consistency, the whole
questionnaire has valid contents and all 4 components were demonstrated
to be unifactorial, the CSFs developed in this study were both reliable
and valid.
7. Discussions of survey results
The research findings indicate that C1 "Managing stakeholders
with social responsibilities (economic, legal, environmental and
ethical)" ranked first in the 15 CSFs for stakeholder management in
construction projects. This means that project managers considered this
factor as the most important one for the success of stakeholder
management. As discussed in the overview (Section 3), this finding was
in line with several researchers' statements (e.g. Wood 1991;
Carroll 1991; and Donaldson and Preston 1995). However, according to the
results of factor analysis, this factor could not be included in any of
the 4 components. Owing to the significance of this factor, the authors
name this factor as the "precondition factor" for stakeholder
management; that is, stakeholder management should be conducted with
social (economic, legal, environmental and ethical) responsibilities.
Under this precondition, and including the 4 components extracted by
factor analysis, a framework for successful stakeholder management in
construction projects is proposed in Fig. 2.
The framework in Fig. 2, which presents 5 factors groupings,
contributes to the success of stakeholder management and their
relationships. The 5 factors groupings are the "Precondition
factor" and the 4 components extracted by factor analysis, which
are stakeholder estimation, information inputs, decision-making, and
sustainable support. Since the factor about social responsibilities (C1)
is the precondition of any activities for managing stakeholders, it is
put on the top of the other 4 groupings in Fig. 2. According to general
management process, information should be inputted first during the
process of stakeholder management, and then stakeholders could be
estimated based on the information obtained. After accurately assessing
stakeholders, decisions could be made. Sustainable support need to be
conducted during the whole process of stakeholder management, because in
order to promote the management process, project managers need to
monitor the change of stakeholders' influence and relationships,
try to keep a steady relationship with them, and most importantly
communicate with them properly and frequently.
[FIGURE 2 OMITTED]
8. Conclusions
The importance of stakeholder management has been recognized by
many scholars and professionals. With a focus on different aspects of
stakeholder management, various sets of CSFs have been suggested in the
literature. It is crucial to explore the relative importance and
groupings of these factors. This paper presented a part results of a
questionnaire survey, and aims to identify CSFs associated with
stakeholder management in construction projects of Hong Kong, and
explore their ranking and underlying relationship.
The main contribution of this study is identifying an ordered and
grouped set of CSFs for stakeholder management in construction projects
of Hong Kong. 15 CSFs were identified through a literature review,
face-to-face interviews and pilot studies. Based on a questionnaire
survey, the ranking of these CSFs were obtained. This helps clarify what
the highly prioritized factors are. The top 3 factors were: (1) managing
stakeholders with social responsibilities (economic, legal,
environmental and ethical), (2) exploring the stakeholders' needs
and constraints to the project, and (3) communicating with and engaging
stakeholders properly and frequently. Using the factor analysis and
considering the high importance of the factor "managing
stakeholders with social responsibilities" the 15 CSFs were grouped
into 5 dimensions: precondition, factor, stakeholder estimation,
information inputs, decision-making, and sustainable support. All these
5 groupings and their relationship were included in a framework for
successful stakeholder management in construction projects. These
findings could also be used as an assessment tool to evaluate the
performance of stakeholder management and thus help identify areas for
improvement. Since the results in this paper are based on a
questionnaire survey, the respondents may have different understandings
about our statements, and this may bias the scoring of the CSFs.
Therefore, the findings in this paper should be further validated by
case studies, of which the details will be presented in a new article.
In addition, since the interviews and questionnaire survey were
conducted locally in Hong Kong, the findings may not be generalized to
the other geographical locations.
In future studies, the same research procedure should be conducted
in other locations which have different cultures from Hong Kong to seek
the similarities and differences of the CSFs for stakeholder management
in construction projects.
DOI: 10.3846/1392-3730.2009.15.337-348
Acknowledgements
The work described in this paper was supported by the Hong Kong
Polytechnic University and the Research Grants Council of the Hong Kong
Special Administrative Region, China (PolyU 52644/06E). Special
gratitude is also extended to those industrial practitioners who have
responded to and contributed their valuable input in completing the
questionnaire.
Received 05 Feb 2009; accepted 23 Sept 2009
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Jing Yang (1), Geoffrey Qiping Shen (2)*, Manfong Ho (3), Derek S.
Drew(4), and Albert P. C. Chan(5)
Dept of Building and Real Estate, The Hong Kong Polytechnic Univ.,
Hong Kong E-mails: (1)
[email protected]; (2) Corresponding author:
[email protected]; (3) bscrysta@polyu. edu. hk; (4)
dereksdrew@hotmail. com; (5) bsachan@polyu. edu. hk
Ms. Jing YANG worked for the construction industry in the field of
Quantity Surveying before switching to academia. Now she is a PhD
student at the Department of Building and Real Estate, The Hong Kong
Polytechnic University. Her research interests are in stakeholder
management and social network analysis. She is also a committee member
of the Hong Kong Institute of Value Management.
Professor Geoffrey Qi-Ping SHEN is an active researcher in group
dynamics, value management, and partnering. He has led a large number of
research projects with total funding over HK $20 million including 7
successful RGC CERG, and published more than 100 papers in international
refereed journals. He teaches extensively in these fields and has
successfully supervised a number of PhD students. Professionally, he
serves as the President of the Hong Kong Institute of Value Management;
member of the Institute of Value Management (UK). As a certified value
specialist (US) and value management facilitator (HK), he has
professionally designed and facilitated a number of value management
and/or partnering workshops for a variety of large projects.
Dr Christabel M. F. HO worked for the construction industry in the
field of quantity surveying before switching to academia. She is a
Chartered quantity surveyor and building engineer by profession. Member
of both the Chartered Institute of Building and the Australian Institute
of Building. Also a member of the Australian Institute of quantity
surveyor. She completed her PhD at the University of New South Wales
(Australia). Her current research interests include professional ethics
and construction management.
Dr Derek S. DREW is an Associate Professor at the Department of
Building and Real Estate, The Hong Kong Polytechnic University. His
research interests include tendering, and competitiveness of contractors
and consultants.
Professor Albert Ping-Chuen CHAN is a Professor and Associate Head
at the Department of Building and Real Estate, The Hong Kong Polytechnic
University. His research interests include project management and
project success, project finance and public private partnerships,
construction procurement and relational contracting, construction
industry development and construction safety.
Table 1. Expert profiles
Role in Experience
Expert projects Position (years)
1 Client Chief project manager 21
2 Client Senior project manager 15
3 Consultant Site project manager 12
4 Client Site project manager 15
5 Contractor Senior project manager 13
6 Contractor Site project manager 11
Table 2. Ranking of the 15 CSFs
CSFs Mean Rank
C1. Managing stakeholders with social responsibilities 4.43 1
(economic, legal, environmental and ethical)
C5. Exploring stakeholders' needs and constraints to 4.26 2
projects
C15. Communicating with and engaging stakeholders 4.26 2
properly and frequently
C4. Understanding the area of stakeholders' interests 4.22 4
C3. Identifying stakeholders properly 4.21 5
C11. Keeping and promoting a good relationship 4.17 6
C9. Analyzing conflicts and coalitions among 4.04 7
stakeholders
C7. Predicting the influence of stakeholders 4.02 8
accurately
C12. Formulating appropriate strategies to manage 3.97 9
stakeholders
C8. Assessing attributes (power, urgency, and 3.91 10
proximity) of stakeholders
C10. Compromising conflicts among stakeholders 3.88 11
effectively
C2. Formulating a clear statement of project missions 3.87 12
C13. Predicting stakeholders' reactions for 3.83 13
implementing the strategies
C14. Analyzing the change of stakeholders' influence 3.83 13
and relationships during the project process
C6. Assessing stakeholders' behaviour 3.80 15
Notes: Number = 183.
Kendall's coefficient of concordance = 0.122. Level of
significance: 0.00.
For 'Mean scores': 1 = least important and 5 = most important.
Table 3. Spearman rank correlation coefficients
Client/ Client/ Contractor/
Respondents Contractor Consultant Consultant
r .624 * .893 * .803 *
* Correlation is significant at 0.05 level (2-tailed).
Table 4. The correlation matrix of the CSFs
CSFs C1 C2 C3 C4 C5 C6 C7 C8 C9
C1 1.00 .245 .266 .331 .322 .115 .265 .243 .217
C2 .245 1.00 .420 .352 .274 .153 .210 .063 .220
C3 .266 .420 1.00 .489 .406 .307 .316 .255 .270
C4 .331 .352 .489 1.00 .586 .408 .412 .324 .413
C5 .322 .274 .406 .586 1.00 .280 .365 .256 .414
C6 .115 .153 .307 .408 .280 1.00 .534 .430 .410
C7 .265 .210 .316 .412 .365 .534 1.00 .545 .463
C8 .243 .063 .255 .324 .256 .430 .545 1.00 .419
C9 .217 .220 .270 .413 .414 .410 .463 .419 1.00
C10 .243 .331 .300 .248 .194 .286 .433 .254 .358
C11 .357 .307 .302 .331 .396 .323 .365 .292 .270
C12 .322 .314 .373 .357 .257 .262 .377 .219 .306
C13 .313 .240 .427 .302 .229 .292 .487 .329 .320
C14 .248 .192 .327 .390 .358 .429 .437 .298 .520
C15 .266 .105 .192 .279 .354 .232 .217 .076 .237
CSFs C10 C11 C12 C13 C14 C15
C1 .243 .357 .322 .313 .248 .266
C2 .331 .307 .314 .240 .192 .105
C3 .300 .302 .373 .427 .327 .192
C4 .248 .331 .357 .302 .390 .279
C5 .194 .396 .257 .229 .358 .354
C6 .286 .323 .262 .292 .429 .232
C7 .433 .365 .377 .487 .437 .217
C8 .254 .292 .219 .329 .298 .076
C9 .358 .270 .306 .320 .520 .237
C10 1.00 .347 .416 .471 .276 .160
C11 .347 1.00 .459 .339 .345 .347
C12 .416 .459 1.00 .512 .471 .411
C13 .471 .339 .512 1.00 .489 .125
C14 .276 .345 .471 .489 1.00 .414
C15 .160 .347 .411 .125 .414 1.00
Table 5. Bartlett's test for the CSFs and KMO
Bartlett's test of sphericity Approx. Chi-Square 960.363
df 105
Sig. .000
Kaiser-Meyer-Olkin measure of sampling adequacy .870
Table 6. Results of factor analysis
% of Name of CSFs Factor
Components Eigenvalue variance components (a) (b) loading
1 5.618 37.455 Stakeholder C8 .760
estimation C6 .727
C7 .713
C9 .649
2 1.347 8.978 Information C2 .713
inputs C3 .676
C4 .678
C5 .636
3 1.181 7.872 Decision- C13 .727
making C10 .713
C12 .617
4 1.084 7.227 Sustainable C15 .873
support C14 .535
C11 .501
(a) Components were named based on the characteristics of its CSFs in
that group,
(b) The meanings of C2 to C15 are given in the list of CSFs in
section 4.
Table 7. Unifactorial test
Percentage
variance
Component KMO value Factor loading Eigenvalue explained
1 0.776 0.728-0.831 2.405 60.132
2 0.721 0.646-0.825 2.275 56.880
3 0.653 0.744-0.814 1.817 60.556
4 0.606 0.697-0.848 1.789 59.622
