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

Author

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  • 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
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    References listed on IDEAS

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    4. 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.
    5. 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.
    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.
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    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.

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