An Empirical Study on Identification of Critical Success Factors in Project Based Organizations

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. 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. …