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Cost and Time Project Management Success Factors for Information Systems Development
Projects

Otávio Próspero Sanchez

PhD - Business Administration at Escola de Administração de Empresas de São Paulo da

Fundação Getulio Vargas (FGV-EAESP)

Visiting at Eller College of Management - University of Arizona

Professor at Escola de Administração de Empresas de São Paulo da Fundação Getulio Vargas

(FGV-EAESP)
São Paulo, SP 01313-902, Brazil
[email protected]

Marco Alexandre Terlizzi

PhD candidate - Business Administration at Escola de Administração de Empresas de São Paulo
da Fundação Getulio Vargas (FGV-EAESP)
São Paulo, SP 01313-902, Brazil
[email protected]
Corresponding author

Heverton Roberto de Oliveira Cesar de Moraes

PhD candidate - Business Administration at Escola de Administração de Empresas de São Paulo
da Fundação Getulio Vargas (FGV-EAESP)
São Paulo, SP 01313-902, Brazil
[email protected]

© 2017 published by Elsevier. This manuscript is made available under the Elsevier user license
https://www.elsevier.com/open-access/userlicense/1.0/
 Cost and Time Project Management Success Factors for Information Systems
Development Projects

Abstract

Successful development of Information Systems (IS) Projects has been a source of

competitive advantage for many organizations. This paper proposes the Cost and Time Project
Management Success – CTPMS, an essential measure in this context because projects must
dynamically address cost and time success under an agreed scope. The goal of the paper is to
identify the project management practices through which an organization can optimize the
CTPMS of IS development projects. Because multiple factors can influence project management
success, we analyze a real-world sample of 899 IS projects of a leading bank, using hierarchical
models to account for the effects of predictors at four levels of analysis: portfolio network,
project, project manager, and team. In addition to proposing and discussing a new measure of
project management success for information systems development projects, we identified that
project size, duration, postponement, and project manager formal power showed positive effects,
whereas team size and team allocation dispersion presented negative effects. The results suggest
guidance for factors such as team member allocation and prioritization, among others.

Keywords: IS success, Information Systems Project Management, Project Management

Success, Agile

1. INTRODUCTION

Because some economic sectors are very dependent upon the proper use of information,
they have attempted to grow their awareness of how to address technology. Organizations have
found that developing Information Systems (IS) is the key to success in such sectors. However,
even with the required specialization to develop information systems, this activity is not free of
failure. In fact, according to a report based on the insights of 3,234 project management
professionals, 200 senior executives, and 510 PMO directors from many industries, 19% of all
projects fail, and not less than 52% of the total have shown budget loss or scope creep (PMI,
2017).
 Despite the fundamental importance of achieving project success, concerning how project
management success is considered and measured, the literature does not address the
interrelatedness of key related factors. For example, although many studies have shown that
project success depends upon project manager characteristics, team motivation, project features
and even portfolio prioritization (PMI, 2017), the literature as a whole has not explored the
interrelationships of these many levels.

One possible reason for studies simultaneously omitting consideration of these multiple
levels of the antecedents of project success is that studies are usually supported by survey data
that are collected only at the project manager level. Although these perceptual data can help the
researcher to focus on specific factors of project success, they rarely can be collected
simultaneously for multiple projects, project managers or teams.

The purpose of this paper is to analyze the antecedents of information systems

development Cost and Time Project Management Success – CTPMS, considering the
simultaneity of the variables at multiple levels of analysis: portfolio network, project, program
manager, and team level. The goal is to identify the project management practices through which
an organization can enhance its competence to achieve the success of information system
development projects. This study also adds to the field by employing secondary data and thus
avoiding the potential pitfalls of deriving conclusions from perceptual data.

The research used data from a leading financial service provider that develops more than
3,000 IS projects annually. The Financial Service Industry (FSI) is responsible for 13% (US$
351 billion) of the world's total investments in IT. In Brazil, the country from which we collected
the data, this percentage is even larger because the FSI is responsible for 14% (US$ 6 billion) of
the country's total investments in IT (Deloitte, 2017). Technology is considered a major
component for the performance of this industry, demanding significant attention from the
agencies that regulate the FSI. For example, the Brazilian Central Bank requires the adoption of
specific project management practices to ensure successful risk mitigation and realization of the
benefits of IT projects (ISACA, 2013; Terlizzi, Albertin, & de Moraes, 2017).

The remainder of this paper is organized as follows. The paper first describes the related
literature in Section 2. It then explains the methods in Section 3. Results are presented in Section
4, followed by discussion in Section 5. Finally, we conclude our findings in Section 6 with the
theoretical contributions, practical implications, and limitations.

2. LITERATURE REVIEW

IS project execution entails delivering or improving products and services that

contribute to the realization of an organization's strategic goals. Therefore, achieving project
success is of the utmost importance and frequently justifies the huge organizational investment.

Because attaining project success depends upon many factors, the success of a project
can be evaluated using different forms; no single best method of measurement exists (Thomas &
Fernández, 2008). Indeed, this topic has generated extensive discussion since the 1970s due to its
various dimensions and interpretations (Ika, 2009). In this context, an analysis of the prior
literature is necessary to clarify some differences between project success (PS) and project
management success (PMS) and to clarify the different factors and perspectives that can
contribute to IS PMS.

2.1. Project Success and Project Management Success

At least one consensus exists in the literature about PS, that is, overall success should be
treated as about two different perspectives. On the one hand, PMS is considered the
responsibility of the project manager and means delivering the outputs of the project on time,
within the budget and with the required features and functions. Consequently, it is usually
measured based on the iron triangle (time, budget and scope/quality). On the other hand, PS can
be viewed as the responsibility of the project owner anticipating the benefits of the project (e.g.,
financial, quality, flexibility, and innovation) (Badewi, 2016; Chih & Zwikael, 2015; Cooper &
Edgett, 1997; Doherty, Ashurst, & Peppard, 2012; Terlizzi, Meirelles, & Moraes, 2016; Tesch,
Sobol, Klein, & Jiang, 2009; Turner & Müller, 2005).

Interestingly, from the perspective of the IS projects literature, the concept of PS is

massively employed as synonymous to PMS because the iron triangle is used in approximately
two-thirds of the 26 publications addressing PS analyzed from 1997 to 2009 (De Bakker,
Boonstra, & Wortmann, 2010). Likewise, The Standish Group has also been monitoring IT
project success worldwide since 1994 using the iron triangle as an indication of success; only in
2015 was this concept enhanced to consider other, additional dimensions of success (Hastie &
Wojewoda, 2015).

To clarify how the current literature addresses this problem, we performed a systematic
literature review of the top two project management journals from 2006 to 2016, seeking to
complement De Bakker et al.’s study. This review identified 31 papers, with their main findings
presented in Table 1.

*** INSERT TABLE 1 HERE ***

First, in the area of information systems development, the most common consideration
about project success is scope success (Agarwal & Rathod, 2006). In this type of project, many
small changes are expected to be decided upon during the execution of the project. These
decisions occur because the owner is not usually completely aware of the specific aspects
involved in the system coding. Additionally, occasionally fulfilling the exact definition of a
product by codification can result in a large number of hours of additional coding. Therefore, the
information systems project manager is frequently compelled to negotiate small changes in scope
between the project owner and the project team. This negotiation frequently addresses the
unnecessary development time overrun needed to include a less important feature that might be
too difficult to implement. Another situation occurs when, in contrast, negotiation is required to
approve additional features that might become salient as the development teams develop new
ideas that arise during the codification process as they achieve a better understanding of the
client’s needs.

The need to constantly negotiate small scope changes has even generated an IT
phenomenon in the PM practices field, the agile approach for projects (Serrador & Pinto, 2015).
This approach can be viewed as a procedure to improve communications and facilitate these
small adjustments of scope, time and cost (Mastrogiacomo, Missonier, & Bonazzi, 2014).

Despite these dynamics, PMS assessment has remained almost the same since the
introduction of the iron triangle (Lech, 2013), that is, as though its components of scope, time
and cost were independent. When addressing information systems projects, it would be of great
value if new measures of PMS were proposed to better combine cost and time, given a scope
agreement (Lech, 2013).
 Another aspect is that, although project success appears to depend upon multiple
interrelated aspects, only a few studies applied the multilevel approach to analyzing the
antecedents of success in projects. Twenty papers, or 65% of the papers selected, analyzed only
one antecedent level. We found that a substantive number of studies (14 articles – 45%)
addressed the project manager antecedent, followed by project perspective (9 papers – 30%) and
team project perspective (7 papers – 22%). We found that this limitation represents a substantive
gap in the literature because no papers analyzed the effects on success from the perspective of a
multilevel combination of factors.

Second, the majority of the data used in research thus far was found to be collected
based on surveys (20 papers – 65%) ranging from 25 to 1.387 respondents. The other data
collection methods were interviews (6 papers – 20%) varying from 4 to 108 interviewees,
literature reviews (3 papers – 10%), and finally documentation (2 articles – 5%). Additionally,
concerning the respondent profiles, the studies essentially surveyed the perceptions of project
managers. None of the studies employed real-world secondary data records, which we consider
another major gap in the literature because perceptual responses can potentially carry respondent
bias. Although all sources of data can show some positive aspects in the study, data records are
considered more precise, allowing non-perceptual analysis (Yin, 2013).

Additionally, project management theoreticians recognize the importance of

accumulating studies from various industries around the world to expand the research field
(Turner & Ledwith, 2016). In the period analyzed, we observed a diversity of studies in the
literature from some world regions and various sectors, but only four studies focussing
specifically on the FSI. It is relevant that FSI invests in technology more than any other sector
does and is thus expected to master superior IS management techniques (Berghout, Nijland, &
Powell, 2011; Deloitte, 2017). Therefore, it is important to increase the focus on this industry.

2.2. Project Management Success – A Multi-Level Perspective

In the study of organizations, it is common to adopt a multilevel approach to understand

management problems because the use of a micro or a macro lens alone allows for only an
incomplete understanding of the problem. Thus, the need for contextualizing the research
theories recommends the use of a multilevel approach (Hitt, Beamish, Jackson, & Mathieu,
2007). Although doing so adds complexity, multilevel research allows building theories that
allow a deeper and richer portrait of organizational life (Klein, Tosi, & Cannella, 1999).
According to Burton-Jones and Gallivan (2007), theory integration across levels creates new
research opportunities because this multilevel perspective represents a more natural and
complete approach to examining phenomena.

From an information technology perspective, the multilevel approach offers an

alternative approach to examining the phenomena by simultaneously accounting for the nature of
the phenomena through which the study explores the interplay between technologies and human
actors (Aubert, Barki, Patry, & Roy, 2008). However, studies that examine the IS phenomena
from a multilevel perspective remain scarce (Bélanger, Cefaratti, Carte, & Markham, 2014).

In last five decades, the project management literature has tried to depict the conditions
that lead to a successful project from a multilevel perspective (Bendoly, Thomas, & Capra, 2010;
Shenhar & Levy, 1997; Tatikonda & Rosenthal, 2000); nevertheless, few studies have
considered the simultaneous approach as a relevant analysis of PMS. For example, the extent of
usage of risk management practices, such as risk identification, probabilistic risk analysis,
planning for uncertainty, trade-off analysis, and their relationship with various project success
dimensions was examined by Raz, Shenhar, and Dvir (2002). The study was based on data
collected on 100 projects performed in Israel and showed that risk management, when used, can
contribute to project success and that its effect is primarily on better meeting times and budget
goals rather than on product performance and specification achievement. In another vein,
Tatikonda and Rosenthal (2000) studied the relationship between product development project
characteristics – technology, novelty and project outcomes – hypothesizing that technology
novelty and project complexity characteristics contribute to project task uncertainty and
consequently define the project execution outcomes. The results revealed that higher project
levels of technical novelty or project complexity are not related to overall project failure.

Conversely, in Bendoly et al. (2010), data collected to multiple levels of analysis helped
the understanding of multilevel interdependencies in project management settings from the
perspective of social factors. The authors analyze the role of individual behavior in driving
project dynamics and performance, providing critical insights into the decisions made by both
project team members and project managers. In the same vein, Loufrani-Fedida and Missonier
(2015) contest the idea of the “ideal” project manager and focus on critical competencies
(functional and integrative) based on individual, collective, and organizational levels.

Despite the efforts of the academic and practical worlds, the rate of success in projects
remains low. Although the general factors related to project failure have already been identified
(PMI, 2017), they are rarely studied together and interrelated. In this study, we grouped the
elements that influence PMS in organizations into four levels: the first, Portfolio Network-Level
Effects, consists of project network closeness and project network eigenvector. The second
comprises Project-Level Effects such as project size, project duration, project postponement, and
project outsourcing level. The third level is related to Project Manager-Level Effects and consists
of project manager formal power and project manager diversity. The fourth level involves Team
Project-Level Effects using team size, hierarchical group diversity, and team allocation
dispersion. Prior studies do not deeply investigate these combined correlated levels, and there is
a lack of empirical studies showing how these four-factor levels might work together.

We present in the following the research model (Figure 1), review the IS and PM
literature, and elaborate the rationale behind each hypothesis concerning the potential effect of
each factor on Cost and Time Project Management Success (CTPMS). In doing so, we believe
we can analyze the consequences of each level of factors more comprehensively.

*** INSERT FIGURE 1 HERE ***

2.3. Portfolio Network-Level Effects

Portfolio management studies stem from seminal academic papers published by Gear,
Lockett, and Pearson (1971). However, information technology portfolio management gained
more attention through McFarlan (1981), who applied the concepts developed by Markowitz
(1952). In the 1990s, with the development of business plans that provide a framework for the
categorization of projects, there was an increase in the volume of literature related to analysis
and planning portfolios (Wheelwright & Clark, 1992), in addition to the development of
selection models and project portfolio management (Archer & Ghasemzadeh, 1999). Project
portfolio management is a process that aims to ensure that the correct project will be done to
achieve the goals desired by the organization (Turner, 2014).
 Project portfolio management has gained the attention of practitioners and executives as
a means to enable organizations to align needed projects with organizational strategy and ensure
adequate human resources for projects at the right time (Killen & Hunt, 2013). Because of its
particular importance, the cost of human resources is frequently well controlled (Acuna, Juristo,
& Moreno, 2006), and allocating the right people determines the quality and productivity of a
project (Chan, Jiang, & Klein, 2008). Therefore, the process of allocating team members based
on the best composition of cost and skills is crucial to project management success (Walter &
Zimmermann, 2016). We considered as portfolio network factors two characteristics related to
the interactions among team members across the portfolio of projects in the organization: Project
Network Closeness and Project Network Eigenvector.

Project Network Closeness and Project Network Eigenvector

A social network approach aims to describe patterns of interactions among people using
a graph of connections, wherein persons within a network are called nodes, and relationships
between actors are called ties (Newman, 2002). Nodes and ties form the structure of a network,
and social network theory describes the network structure regarding resources for social action
(Baker, 1990). Social network theories can highlight how network-enabled exposure to a wider
variety of information affects learning and productivity (Reagans & Zuckerman, 2001).

Two of the indices most commonly used in the social network analyses are closeness
centrality (Beauchamp, 1965) and eigenvector centrality (Bonacich, 1972). Whereas closeness
centrality measures how close a node is to all other nodes in the network, eigenvector centrality
measures how close a node is to well-connected (popular) nodes in the network. In other words,
it is important to connect to nodes, but which node is connected to matters.

IS projects comprise multiple team members, and each team member can participate in
multiple projects. Because team members can exchange ideas (Zika-Viktorsson, Sundström, &
Engwall, 2006) and share knowledge on software development techniques between multiple
project teams (Ozer & Vogel, 2015), the network of projects functions as a conduit for
knowledge and expertise flow across the connected IS projects (Xu, Christley, & Madey, 2006).
The relationships in which members and projects are embedded can lead to improved outcomes
and performance (Burt, 2009), influencing the success of projects due to the decreased cost of
coordination among members (Peng, Wan, & Woodlock, 2013).

However, not all relationships matter. In fact, for a specific skilled team member, being
allocated to a myriad of projects can reduce his/her productivity and hinder the proper spread of
his/her knowledge because a variety of team memberships increases the information complexity
a skilled team member must address. Additionally, too many connections can slow the speed of
project development (Colazo, 2010) because building and maintaining relationships with others
takes time and effort and consumes resources (Adler & Kwon, 2002).

Thus, an increased number of generic ties can improperly create information overload
and enhance the managing cost, consequently reducing outcome and performance (O'leary,
Mortensen, & Woolley, 2011). Therefore, we posit the following:

Hypothesis 1: Higher project network closeness has an adverse effect on the Cost and
Time Project Management Success (CTPMS) of IS development
projects.
Conversely, establishing connections with individuals who can exchange useful
information allows team members to reach others with the same level of skills (Ozer & Vogel,
2015). Software requirements’ volatility and technological novelty increase the simultaneous use
of multiple software development frameworks within a single project, which requires specialized
information (Ramasubbu, Bharadwaj, & Kumar Tayi, 2015). Moreover, managers can cooperate
in the use of the management controls (Korhonen, Laine, & Martinsuo, 2014), which can
improve the performance of IS projects that they are managing.

Having good-quality ties grants quick access to specialists and similar projects. The
performance of collaborative but equitable tasks between team members nurtures the social
capital formation by which knowledge, trust, and mutual respect are fostered, which contributes
to granting improved productivity to individuals (Wagner, Beimborn, & Weitzel, 2014). We,
therefore, propose the following:

Hypothesis 2: A higher project network eigenvector has a positive effect on the Cost
and Time Project Management Success (CTPMS) of IS development
projects.

2.4. Project-Level Effects

 Considering that there is a need to develop project and program management to promote
organization success (Martinsuo & Hoverfält, 2017), the literature identifies many specific
characteristics that projects can assume and that should be considered when analyzing CTPMS.
We considered as project factors Project size, Project duration, Project postponement, and
Project Outsourcing level.

Project Size and Duration

The literature presents different postulates concerning the effect of project size and
duration on PMS. According to Wallace, Keil, and Rai (2004), longer-duration projects tend to
carry greater risks along the following dimensions: team, organizational environment,
requirements, planning and control, user, and project complexity. Equally, as mentioned by
Martin, Pearson, and Furumo (2007), larger IS projects with longer duration have more difficulty
meeting project budgets and quality due to the cost of the technology, increased staff allocated,
the greater number of vendors hired and the higher complexity of coordination and control.

Similarly, Taylor, Artman, and Woelfer (2012) posit that large projects tend to be more
complex and riskier; such projects require larger teams and better communication, leading to
higher organizational complexity and decreasing the likelihood of success. Therefore, splitting
long projects into shorter sub-projects can reduce the complexity, mitigate the risks and increase
the chances of success.

Conversely, longer projects, usually those lasting more than one year, have a positive
effect on team skills development, showing a subsequent positive influence on PMS. Managers
have the appropriate time to invest in practices for team development that positively affect
project success; for example, ‘pay and reward’ contributes to reduced schedule overrun, whereas
‘coordination’ has a major effect on improved customer satisfaction (Zwikael & Unger-Aviram,
2010). In the same vein, Liu, Xia, Zhang, Pan, and Zhang (2016) concluded that in
crowdsourcing projects, the complexity risk associated with larger projects can be easily
mitigated because crowdsourcing can recruit a group of trained individuals to accomplish the
project tasks.

Adding to this view, Cho, Hong, and Hyun (2009) have found that short-term projects
are associated with higher cost overruns. Accordingly, Gefen, Gefen, and Carmel (2016) argue
that larger projects with longer duration are more likely to be successful because they are
supposed to be minutely described, with a higher chance of being understood correctly and
estimated more precisely. It is very common in software development that unexpected problems
occur, for example, misunderstood specifications, technical difficulties, inconclusive testing, and
a host of related problems. In longer projects, there is ample time for the team to address these
unexpected problems, minimizing any effect on costs and time performance.

Therefore, in line with the argumentation, we state that the following:

Hypothesis 3: Increased project size enhances the Cost and Time Project
Management Success (CTPMS) of IS development projects.
Hypothesis 4: Increased project duration enhances the Cost and Time Project
Management Success (CTPMS) of IS development projects.

Project Postponement

Project postponement refers to the flexibility to postpone the start of a project execution
and part of its resources commitment. This decision can be based on the necessity of learning
about the nature of uncertain payoffs and can result in prioritization changes (Benaroch, Jeffery,
Kauffman, & Shah, 2007). Making this decision at the beginning of an IS project can avoid
additional investment and even cash flow losses. Examples include delaying until a new, less-
costly technology is available and proven feasible or waiting for an appropriate modification in
legislation that might justify a drastic redefinition of the project scope (Benaroch & Kauffman,
2000).

Project postponement is one of the project portfolio management decisions comprising

decisions to start, stop or accelerate projects (Cooper & Edgett, 1997). On the one hand, the
decision to postpone an IS project can reduce the project benefits, particularly when the project
involves the launching of an innovative technology that can bring competitive advantage only to
first movers. On the other hand, organizations must also evaluate the risk of potential losses that
uncertainty can cause and adopt a defensive posture of postponing the project beginning
(Fichman, Keil, & Tiwana, 2005). In other words, although the postponement option should
contemplate the cost of not making a decision (Lewis, Enke, & Spurlock, 2004), a project start
delay can be worthwhile if the future information is expected to decrease the execution risks
(Benaroch et al., 2007).
 Based on these elements and considering that the agencies that regulate the financial
service industry in Brazil require the adoption of project management controls to avoid the
inherent risks of IS projects (Terlizzi & Biancolino, 2014; Terlizzi et al., 2016), we agree with
the positive influences argumentation and state the following:

Hypothesis 5: The longer the Project Postponement is, the higher is the Cost and Time
Project Management Success (CTPMS) of IS development projects
A postponement option allows decision makers to collect additional information to cope
with the potential risks of the project. However, the perceived risks are expected to be mitigated
in longer projects because opportunities will likely arise to consider solutions for them in the
future. Moreover, some risks in longer projects tend to be emphasized less because less complete
information is available ex-ante (Benaroch et al., 2007). Therefore, we extend the previous
hypothesis as follows:

Hypothesis 6: Project Duration moderates and reduces the direct effect of Project
Postponement on the Cost and Time Project Management Success
(CTPMS) of IS development projects.

Project Outsourcing Level

Outsourcing the IS functions has been widely discussed in the literature in recent years
(Lacity, Khan, Yan, & Willcocks, 2010; Liang, Wang, Xue, & Cui, 2016), and cost reduction
emerges as one of the major factors that lead a corporation to consider outsourcing (Schwarz,
2014). Companies list many motivators for outsourcing their IS activities such as the rapid
introduction of new products, the need to focus on their core business, increased productivity,
improved access to technical expertise, and a lack of the required internal resources (Gorla &
Somers, 2014).

Specifically, from an IS project perspective, outsourcing is considered a crucial decision

due to its effects on project costs and times (Gorla & Somers, 2014). Several studies point to a
positive relationship between IS project outsourcing and PMS. For example, Mao, Lee, and
Deng (2008), in their study about trust and control in IS outsourcing, indicate that client control
over the vendor has a significant effect on cost control, helping the vendor to prevent cost
overruns. In their study with 57 outsourced and 79 internal IT projects, Tiwana and Keil (2009)
concluded that because control mechanisms are effective in internal projects but not effective in
outsourced projects, managers could reduce control when outsourcing projects. Srivastava and
Teo (2012) posit that when IS activities are performed by a supplier rather than internally, client
governance can be better performed, coordination costs are low, and quality can be enhanced.
Han, Lee, Chun, and Seo (2013), in their study with 267 project managers, found that
complementary client and vendor IT capabilities are significant factors of IS project success. Liu
and Wang (2014) argue that outsourcing a project is the best option for organizations whose
internal IT units do not possess sufficient technical expertise and knowledge; and Gefen et al.
(2016) mention that to avoid problems in project execution, risk management usually considers
outsourcing to ensure project success. In summary, we propose the following:

Hypothesis 7: The higher the project outsourcing level is, the higher is the Cost and
Time Project Management Success (CTPMS) of IS development
projects.

2.5. Project Manager-Level Effects

A project manager (PM) is responsible for overseeing the project and the project
team (DuBois, Koch, Hanlon, Nyatuga, & Kerr, 2015). The PM must also be concerned with the
business interests (Martinsuo & Lehtonen, 2007) to guarantee PMS. Millhollan and Kaarst-
Brown (2016) mention a list of soft and hard skills required for a PM to perform his/her activities
with mastery: project management, business, management, knowledge of the project technical
disciplines, interpersonal, managing the project sponsor, situational awareness, and integrating
previous skills and knowledge. The literature includes many factors related to project manager
characteristics that can influence PMS; therefore, we considered as PM factors two
characteristics related to the organization: PM formal power and PM management diversity.

PM Formal Power

To be able to inspire people, project leaders must be able to influence others to act to
achieve project goals. However, in leadership, it is important not only to achieve good business
results but also to create a culture in which people are empowered and inspired by a common
purpose (DuBois et al., 2015). However, to achieve project management success, the project
manager needs not only the soft skills to motivate team member contributions but also to access
the hard skills (tools and techniques) necessary to monitor and control the project activities
(Singh & Tan, 2010). Additionally, the PM must have the authority to delegate, control and
monitor team member activities (PMI, 2013) and should be formally empowered to act flexibly
in unforeseen circumstances (Jugdev & Müller, 2005).

Formal control is essential to mitigate the risks (Terlizzi & Biancolino, 2015; Tiwana &
Keil, 2007) and improve the performance of both internal (Keil, Rai, & Liu, 2013; Liu & Wang,
2016) and outsourced IT projects (Liu, Wang, & Huang, 2017). In some organizations, formal
power is transferred from the sponsor to the project manager in a limited manner. Such a transfer
is not a real problem for experienced project managers because they can accomplish tasks and
minimize the need for formal power, but less experienced ones find it difficult to manage a
project in a scenario with low formal power. This imbalance of authority between the
organization and the project manager can affect PMS (Ives, 2005).

Petro and Gardiner (2015) identified that a project manager's degree of influence in the
organization, translated into his formal power, has a positive effect not only on PMS but also on
portfolio success, client satisfaction, and strategic alignment. Based on these statements, we
propose the following hypothesis:

Hypothesis 8: The higher the PM Formal Power is, the higher is the Cost and Time
Project Management Success (CTPMS) of IS development projects.

PM Management Diversity

The management of projects of different sizes requires diverse approaches, leadership

styles, and skills (Müller & Turner, 2010). At one end of the scale, the management of small to
medium-sized projects requires a focus on prioritizing resource allocation across several projects,
whereas on large projects, the emphasis is on the coordination of a complex sequence of
activities, balancing resources across the activities, but focussing on the enablement of the
critical activities (Payne & Turner, 1999). In general, the knowledge and skills of the project
manager are key to effectively solving project crisis and maximizing the likelihood of project
success (El-Sabaa, 2001). For example, expertise in problem-solving, skills in communication
and leadership, an ability to correctly identify the context conditions, and expertise in planning
and monitoring scope, timelines, and budgets are deemed of fundamental importance (Müller &
Turner, 2010).
 One approach to obtain the knowledge and develop the experience and skills needed is
to be engaged in projects of diverse sizes, in which multiple situations can require the PM to
exert multiple abilities. Being assigned to manage small projects can serve as a training ground
for managers of later large projects (Payne & Turner, 1999). Companies adopt this approach to
leverage their resources more effectively and to promote knowledge transfer, enhancing both
productivity and learning (Milgrom & Roberts, 1992). Based on the above, we formulate the
following:

Hypothesis 9: Higher levels of PM Management Diversity are associated with higher

levels of the Cost and Time Project Management Success (CTPMS) of
IS development projects.

2.6. Team-Level Effects

A team consists of two or more individuals who socially interact when aiming to
perform organizational tasks. These individuals are characterized by (1) common goals; (2)
interdependencies related to activities, workflow, goals, and outcomes; (3) different roles and
responsibilities; and (4) being embedded in an organizational system. Teamwork can be
characterized by recurring cycles of mutually dependent interaction. Currently, many
organizations use some form of team-oriented work to obtain greater efficiency (Kozlowski &
Bell, 2003). However, staffing projects is challenging (Walter & Zimmermann, 2016) because
project teams comprise members with different skills and disciplines and who are difficult to
bring together (Zwikael & Unger-Aviram, 2010). We considered as team factors Size, Allocation
dispersion, and Hierarchical Diversity.

Team Size

Considering the specific context of the development of Open Source Systems (OSS),
increasing the number of developers is not necessarily a problem for the project budget because
individuals are accepted to work based on voluntary affiliation. Studies of OSS dynamics and
team productivity have shown that larger group size positively affects project outcomes due to
developer engagement. To address other motivations, OSS developers can find opportunities in
the main projects for learning, knowing people and improving their reputation if they can be
associated with good performance (Chengalur-Smith, Sidorova, & Daniel, 2010; Ghapanchi &
Aurum, 2012).
 However, the general literature supports the premise that large project team size can
require increased coordination effort and can decrease the motivation of the team members. For
example, a large team can adversely affect the budget (Martin et al., 2007) and result in
productivity losses (Ingham, Levinger, Graves, & Peckham, 1974; Walter & Zimmermann,
2016). In the same vein, there is empirical evidence that as team size increases, productivity per
person decreases due to the effect of social loafing, wherein team members achieve less than
their potential (Chidambaram & Tung, 2005). Taylor et al. (2012) have also posited that larger
teams require higher levels of communication and lead to organizational complexity, whereas
Balliet (2010) argues that a small team eases communication both within the team and to project
stakeholders, improving cohesion and cooperation. Based on these statements, we propose the
following hypothesis:

Hypothesis 10: The larger the project team size is, the lower is the Cost and Time
Project Management Success (CTPMS) of IS development projects

Team Allocation Dispersion

Team allocation in IS projects is based on a combination of the technical project

requirements and the specialties and abilities of the developer. Currently, the required specialties
have been increasingly defined by a fast technological evolution scenario in which knowledge of
numerous technologies and simultaneous use of multiple software development process
frameworks is a reality within a single project (Ramasubbu et al., 2015).

To enhance project performance, projects should be accomplished by relatively small

teams, and developers should be assigned to a preferably limited number of project teams. This
approach also mitigates the fact that team member allocation ideally requires individuals with
multiple skills, but employing such professionals is costly (Walter & Zimmermann, 2016).

Consequently, teams can be elaborated in a manner that groups individuals with

strategically defined complementary abilities and knowledge. Adding to this elaboration work,
collaboration is also needed, and matching team members’ corresponding values is a key to
fostering the required connections and communication. However, deploying the team member
collaboration strategy is also complex (Narayanaswamy, Grover, & Henry, 2013).
 The alternative approach to this complex scenario is to share a precious resource
between multiple projects and attempt to use it productively. In some companies, it is common
for people to be members of five, ten, twelve or even more teams at one time (O'leary et al.,
2011). Considering that this resource is a skilled team member who will be allocated for a few
hours to each of multiple projects with diverse teams, it is reasonable to infer that this individual
would be unlikely to develop shared interests and affinities with any particular project team.
Therefore, we posit the following:

Hypothesis 11: The higher Team Allocation Dispersion is, the lower is the Cost and
Time Project Management Success (CTPMS) of IS development
projects.

Team Hierarchical Diversity

The literature on group diversity provides hints about the possible adverse effect that
functional diversity can have on the organization and project performance. One reason is
associated with the difficulty of inculcating a spirit of teamwork in all members. Team members
tend to have lower group cohesiveness and job satisfaction and higher turnover and job stressors
than do members of homogeneous groups (Ancona & Caldwell, 1992).

Functional diversity in the project team has no direct effect on technical quality, a rather
strong, negative direct effect on budget performance, and no direct effect on meeting schedules
(Keller, 2001). Accordingly, Mannix and Neale (2005) claim that homogeneous teams are better
to profit from existing knowledge. However, considering other types of diversity, it has been
argued that groups with different expertise, experience, and education background benefit
creativity and problem-solving in complex systems (Page, 2010). In line with the previous view,
we propose the following:

Hypothesis 12: Higher levels of project Team Hierarchical Diversity are associated
with lower levels of the Cost and Time Project Management Success
(CTPMS) of IS development projects.
3. METHODS

3.1. Sample and Data Collection

The organization is a Brazilian company in the Financial Service Industry. The

organization is present in 15 countries and is one of the largest in the world in its field, with more
than US$ 400 million in assets and over 80,000 employees. It is included in a list of the top 50
worldwide most valuable banking brands for 2015 (Brand Finance, 2015). The IT department
numbers approximately 5,000 employees and the capacity of external collaborators is flexible,
depending upon demand, whereas the IT Project Management Office (PMO) has 50 employees.
The project portfolio reaches more than 3,000 annually initiated IS projects that are controlled
with a Project Management Information System (PMIS). The projects can receive any of the
following statuses: (1) Draft – project not yet approved (specification and estimate in progress);
(2) In execution – project under development by the IT team; (3) Concluded – total scope
delivered and accepted by the user; or (4) Cancelled – project not approved or terminated
unexpectedly before completion, usually due to reprioritization of the project portfolio or a
change in the political/economic scenario.

An initial dataset of 3,778 IS projects was extracted from the PMIS on February 2016.
The extract contained IS projects launched in the period from December 2013 to December 2014
and concluded within the period of January 2014 to December 2015. The manager in charge of
the PMO explained that canceled projects could not be considered failures because there was no
record justifying the reason for the cancellation or explaining whether there was a partial
delivery of the scope. At the time of data extraction, the cancellation process of IT projects was
under review by the organization; thus, it was not possible to select those projects in the study.

We excluded 2,636 IS projects with fewer than 501 hours of development, reducing the
dataset to 1,142 projects. This reduction was necessary because these projects were deemed
small projects according to the project management methodology (PMM) established by the
organization. Small IS projects are conducted by separate teams and budgets using a simplified
PMM, based on FIFO (First-In, First-Out) order. Therefore, given the very diverse nature of the
project management processes, we decided that small IS projects should be examined in a
separate study.
 Later, we further deselected cases that were considered an extreme case of success,
which we found unlikely. For example, cases that succeeded in time by using less than 33% of
the baseline time or cases that succeeded in cost by costing less than 33% of the baseline cost
were segregated. Those cases were deemed as likely having a faulty initial process or involving a
major scope change not incorporated into the baseline. To apply this criterion, we developed
additional indicators for Cost Project Management Success (CPMS) and Time Project
Management Success (TPMS) that were calculated based on the percentage of cost deviance
incurred from the baseline cost and percentage of time deviance incurred from the baseline time,
respectively. Cost or time unsuccessful projects, however, were included at any percentage of
deviance. Based on this criterion, 243 projects were isolated from the dataset, resulting in 899
valid scope successful IS projects; thus, it was not necessary to calculate the Scope Project
Management Success indicator.

In the studied organization, IT projects are classified and organized into three different
categories: corporate IT projects (usually infrastructure projects with high investments), business
projects (creation of new products and services or improvement of existing ones) and support
(maintenance of legacy systems, operational risk, and regulatory issues). Table 2 presents the
characteristics of some IT projects selected in the sample.

*** INSERT TABLE 2 HERE ***

3.2. Measures

We operationalize all variables as follows:

3.2.1. Dependent variable

In contrast to the traditional measures of PMS found in the literature, we propose an

incremental-marginal perspective for the CTPMS indicator. This approach presumes that small
increments in the values relative to the baseline of each dimension (cost or time) are mutually
dependent. This aspect is an important consideration because the project management success
literature focusses largely on aggregate (and usually perceptual) measures, as though one
dimension could be fulfilled without considering the effects on the others. Consequently, we
operationalize CTPMS as the relationship of the baseline cost to actual cost that a successful
scope and cost project incurs, multiplied by the relationship of the baseline time to the actual
time expended that a successful scope and time project incurs. This approach is consistent with
the classic philosophical logic that considers an attribute of existence when satisfying the
necessary and sufficient conditions to fit it into a specific category (MacKenzie, Podsakoff, &
Podsakoff, 2011). In the case of CTPMS, cost and time success measures are both necessary and
sufficient to characterize the focal attribute, and the mathematical product operation corresponds
to the simultaneity condition (Goertz, 2005).

This perspective allows simultaneously considering small deviations from planned cost
and time while controlling for the scope. The reason we propose the measurement model in this
manner is that, as discussed in the literature review, it is usual for project managers to
dynamically negotiate and adjust project requirements between development and business/client
teams. Consequently, multiplying both scores results in an efficient measure of the combined
CTPMS, considering a scope, cost and time success. For example, a project manager can reduce
a project’s cost by allocating a smaller number of developers, which would result in a partial
advantage from a cost reduction relative to the budget. By acting in this manner, however, it will
most likely take longer for the project to be finished, which leads to a time disadvantage. Such
articulation of resources during development is very common because it can provide necessary
portfolio management and team allocation flexibility. Consequently, if the adjustments occurred
proportionally during the project, meaning that proportional variations in time compensate for
variations in cost, and if the overall project is deemed successful by the client in scope, cost and
time, the consequences of such adjustments on the indicator score should represent the same
level of success as if the project met both the cost and time baseline. Remember that all projects
in the sample are considered successful in scope, time and cost. Therefore, this indicator is
measuring variations in the composite PMS, for which we are studying the antecedents.

Consistent with our proposition, deviations from either cost or time (or both) baselines
result in a score that can depart from the gold maximum of “1”. This operationalization also
compensates for managerial decisions that might proportionally combine the use of resources.
For example, the managerial team might decide to reduce time by 10% and use an increment of
10% in cost, with the resulting maximum score. Equation 1 is the Cost-Time PMS formula:

= . (Eq. 1)
3.2.2. Independent and control variables

Project Size: We operationalize project size by the total number of labor units required
to complete the project (Calisir & Gumussoy, 2005; PMI, 2013), expressed in hours.

Project Duration: Project duration is the time required to complete the project (Calisir
& Gumussoy, 2005; PMI, 2013), expressed in days and calculated by the difference between the
actual finish date and the actual start date of the project.

Outsourcing Index: The outsourcing index is the relationship between the total number
of hours outsourced and the total amount of labor (work hours).

Project Postponement: We operationalize project postponement by the difference of

days between the planned start date indicated in the project baseline and the actual start date. A
positive number means that the project started late and that it might incur additional costs
(Olaniran, Love, Edwards, Olatunji, & Matthews, 2015).

Team Size: Team size is defined as a set of individuals who support the project manager
in performing the work of the project to achieve its objectives (Calisir & Gumussoy, 2005; PMI,
2013), and was operationalized by the project’s headcount. Outsourced resources and employees
of the business departments do not register time sheets on the PMIS; thus, the variable team size
considers only the employees that work in the IT department.

Team Allocation Dispersion: Team allocation dispersion is defined as the intensity with
which a project combines analysts with an hourly allocation that departs from the typical
allocations of the majority of the other team members. The best case is to allocate the developer
to complete a task or deliver a feature according to its capacity (PMI, 2013). We operationalize
team allocation dispersion by the standard deviation of the hourly allocation of the team
members within each team.

Team Hierarchical Diversity: We operationalize hierarchical team diversity as a

measure of the spread of the hierarchical position (H) of team member (m) within each project (i)
according to their position in the organization. The formula calculates the variance of a binomial
distribution as follows:

= ! − # $% . ! $& (Eq. 2)
'
 Project Network Closeness: We operationalize project network closeness with network
analysis using the team allocation as measures of the edges. Consequently, the nodes were set as
the projects, and in this case, network closeness is a measure of how central a project is
considering all other projects in the network portfolio because of multiple allocations of
developers (Beauchamp, 1965). The use of the Social Network Theory is new in the project
management research field, and it has been recently used in studies of open source projects (Peng
et al., 2013).

Project Network Eigenvector Centrality: We operationalize project network eigenvector

centrality with network analysis using the team membership as measures of the edges.
Consequently, the nodes were set as the projects, and in this case, network eigenvector centrality
is a measure of how central the project to other central projects in the portfolio network because
of multiple allocations of developers (Bonacich, 1972).

Project Manager Formal Power: This variable is defined as a measure of the formal
authority given to the project manager to apply organizational resources to project activities
(Lee, Lee, & Souder, 2000; PMI, 2013). The variable was operationalized based on the project
manager role (1=system analyst junior, 2=system analyst medium, 3=system analyst senior,
4=coordinator, and 5=manager) using a dummy variable set to zero if manager role is 1 to 3, and
assume value=1 if manager role is 4 to 5 (Sandhu, Coynek, Feinsteink, & Youmank, 1996).

PM Management Diversity: This variable represents a project manager that coordinates

projects of different sizes (Müller & Turner, 2010). We operationalize PM management diversity
as a measure of the spread of the size of the managed project (Ps) of the project manager (PM)
within each managed project (i). The formula calculates the incremental project variance of a
binomial distribution as follows:

+ %
( = )* + − ,,,,- . ! $./ (Eq. 2)
'

3.3. Analytical Procedures

To test for simultaneous effects of multilevel predictors on CTPMS, we performed a

hierarchical regression analysis, which is an incremental variance partitioning technique. The
technique is adequate when the dependent variable nature is continuous, and the study is
intended to analyze multiple variables, ruling out effects already addressed in the model (Cohen,
Cohen, West, & Aiken, 2003). This technique is used not to achieve a high explanation power
but rather to evaluate the relative importance of some variables added to variables already in the
model, allowing the researcher to understand any effects of the predictors on the dependent
variable (Pedhazur & Schmelkin, 1991).

First, for theoretical reasons, we started by adding to model 1 (Table 4) the variables
frequently noted in the literature as showing the effects of PMS: Project size, Team size, and PM
formal power. These variables are then used to create the null model from which we seek
statistically significant changes in R2 that would be presented in the subsequent models, set up by
adding other blocks of variables (Cohen et al., 2003). Per our research purpose, to check for the
effects of different levels of analysis, the additional blocks used to create subsequent regression
models are related to the levels of analysis, from the lowest to the highest level, considering the
project as a starting point. Therefore, the Project (model 2) was considered the lowest level, and
then subsequently the Team, Portfolio and PM levels were analyzed. Additionally, interactions
that would have theoretical support were also tested in model 6.

We mean-centered all variables to avoid any potential for multicollinearity and

specifically examined the threat of multicollinearity by calculating the variance inflation factor
(VIF) for each predictor (Cohen et al., 2003) in the complete model.

4. RESULTS

4.1. Descriptive statistics

Table 3 provides descriptive statistics and Pearson and Kendall's tau correlations of our
variables. The descriptive statistics indicate that the sampled Project Size met an average of
2,931 hours, with a wide standard deviation. On average, a team size counts on 9.71 members,
and a project duration averaged 261.7 days. Outsourcing represents, on average, 27.2% of the
size of the projects, whereas project managers are responsible for managing projects that differ
on average by 17.1% in size. Our measure of Cost and Time Project Management Success is
significantly positively correlated with project duration, project postponement, and PM
management diversity, but significantly negatively correlated with outsourcing and team
hierarchical diversity. Variance inflation factors (VIFs) and a linear dependency test were used to
test for collinearity. We found some significant correlations among predictors, but none of the
multicollinearity statistics estimated in conjunction with our regression models reached the point
at which multicollinearity is a concern. All VIF coefficients were individually estimated at any
regression stage and resulted in less than 5, well below the threshold of 10, indicating that
multicollinearity was not a likely threat to the parameter estimation (Cohen et al., 2003).
Additionally, we analyzed the maximum Condition Index (CI) for each block of predictors, and
the result shows the highest value of 5.2, less than the threat value of 15 (Belsley, Kuh, &
Welsch, 2004). These results suggest that multicollinearity is not a concern for our model.

*** INSERT TABLE 3 HERE ***

4.2. Regression analysis results: antecedent’s factors on PMS

H1 suggested that higher project network closeness has a negative effect on the CTPMS
of IS development projects. The results reveal that project network closeness had a negative,
small effect on CTPMS [B = -0.074, t (886) = -2. 160, p<0.05]. Thus, H1 is supported.

H2 indicated that a higher project network eigenvector has a positive effect on the
CTPMS of IS development projects. The results reveal that project network eigenvector had a
small positive effect on CTPMS [B = 0.066, t (886) = 1.83, p<0.10]. Thus, H2 is supported.

H3 stated that project size increments increase the CTPMS of IS development projects.
The results reveal that project size had a strong positive effect on CTPMS [B = 0.261, t (261) =
3.48, p<0.001]. Thus, H3 is supported.

H4 suggested that increasing project duration increases the CTPMS of IS development

projects. The results reveal that project duration had a strong positive effect on CTPMS [B =
0.362, t (886) = 10.791, p<0.001]. Therefore, H4 is supported.

H5 indicated that longer project postponements have a strong positive effect on the
CTPMS of IS development projects. The results reveal that project postponement had a strong
positive effect on CTPMS [B = 0.142, t (886) = 5.08, p<0.001]. Thus, H5 is supported.

H6 postulated that Project Duration moderates and reduces the direct effect of Project
Postponement on the CTPMS of IS development projects. The results reveal that this interaction
is significant, showing a negative, small effect [B = -0.074, t (886) = -2.160, p<0.05], thus
supporting H6.

H7 posited that the higher the level of project outsourcing is, the higher is the CTPMS
of IS development projects. The results reveal that project outsourcing had a marginally negative
non-significant effect on CTPMS [B = -0.024, t (886) = -0.683, ns]. Thus, H7 is not supported.

H8 posited that the higher the PM Formal Power is, the higher is the CTPMS of IS
development projects. The results reveal that PM Formal Power had no significant effect on
CTPMS [B = 0.001, t (886) = -0.032, ns]. Thus, H8 is not supported.

H9 suggested that higher levels of PM Management Diversity are associated with higher
levels of IS development project CTPMS. The results reveal that PM Management Diversity had
a small, positive effect on CTPMS [B = 0.080, t (886) = 2.581, p<0.05]. Thus, H9 is supported.

H10 suggested that the larger the project team size is, the lower is the CTPMS of IS
development projects. The results reveal that project team size had a strongly negative effect on
CTPMS [B = -0.198, t (886) = -3.729, p<0.001]. Thus, H10 is supported.

H11 indicated that the higher the Team Allocation Dispersion is, the lower is the
CTPMS of IS development projects. The results reveal that Team Allocation Dispersion had a
strongly negative effect on CTPMS [B = -0.274, t (886) = -4.188, p<0.001]. Thus, H11 is
supported.

Finally, H12 posited that higher levels of project Team Hierarchical Diversity are
associated with lower levels of IS development project CTPMS. The results reveal that Team
Hierarchical Diversity had a nonsignificant negative effect on CTPMS [B = -0.049, t (886) =
-1.17, ns]. Thus, H12 is not supported.

Table 4 presents the results of fixed-effects regression analysis predicting Cost-Time

Project Management Success.

*** INSERT TABLE 4 HERE ***

We also analyzed the data robustness against the possibility of omitted variable bias. In
our study, Team Time Allocation and Outsourcing Index are likely to be proxies for unmeasured
organizational factors such as software development methodologies, Project Management Office
policies or even organization policies concerning the development of sensitive codes as in
financial sector; information systems are of strategic value. We applied the Ramsey RESET test
for omitted variables, a series of robustness measures to obtain our estimates. The results support
the null hypothesis that the omitted variable bias is not a major concern in the study [F (3,883) =
2.017, ns].

5. DISCUSSION

Expanding upon past research that emphasized the role of only some levels to consider
the antecedent’s factors on project management success, we recognized factors spread across
four different levels of analysis – portfolio network level, project level, project manager level
and team level. We drew on projects in the IS literature to study how related multilevel factors
affect project management success. In addition to assembling multiple levels into one piece of
research, we added the network analysis approach to convey factors that are intensely present in
organizations that address large software portfolios and in which multiple teams are shared
between multiple projects. Table 5 summarizes the results of the hypothesis testing.

*** INSERT TABLE 5 HERE ***

5.1. Project-Level Effects

Considering that a large number of IS projects are concurrently executed in the studied
organization, it is not shocking that larger projects with long duration positively influence PMS
and, accordingly, project success. That effect occurs because, in a bank, larger projects are
usually strategic and prioritized by an executive committee. Furthermore, a project that requires
large investments of resources has one or more senior executives as sponsors, and the successful
benefits realization of such a project is directly linked to the sponsors’ goals. Consequently, a
more robust control structure is organized to ensure PMS of a large and critical project. For
example, although the project is monitored by the project management office and the best team
members are allocated to the project, the evolution of the project is regularly presented to the
executive committee. These findings corroborate previous studies (Cho et al., 2009; Gefen et al.,
2016; Keegan, Huemann, & Turner, 2012; Liu & Wang, 2016; Terlizzi et al., 2017; Zwikael &
Unger-Aviram, 2010).
 Postponing the beginning of a project is closed related to project risk management. As
mentioned by Benaroch and Kauffman (2000), making this decision at the start of an IS project
can avoid additional investments and even cash flow losses. Our empirical study showed that
postponing the start of a project has a positive effect on PMS. In a large finance organization
with many IS projects being executed simultaneously, it is necessary to have an organized queue
of prioritized projects to maximize IT resources. In other words, the beginning of a project is
usually heavily dependent upon the conclusion of other projects that will release necessary
resources. Nevertheless, in such a situation, it is common for a delay in a previous project to
influence the subsequent project. Thus, a well-known practice used by project managers is to
delay the beginning of the project until the majority of the resources are available, ensuring
delivery of the project on time, on budget and satisfying the expectations of the involved
stakeholders. This practice can delay the planned delivery of the project and affect the initial date
of the project benefits capture (Fichman et al., 2005); however, it minimizes the risks of not
meeting the new baseline schedule or exceeding the project budget. These findings corroborate
previous studies (Benaroch et al., 2007; Fichman et al., 2005; Lewis et al., 2004).

Although some previous studies affirm that outsourcing IS projects has a positive effect
on project cost and time (Gefen et al., 2016; Gorla & Somers, 2014; Schwarz, 2014; Srivastava
& Teo, 2012), our study did not show the same result. Our hypothesis that a higher level of
project outsourcing has a positive effect on PMS was not supported. Perhaps this effect does not
occur because some important motivators for outsourcing IS activities such as a lack of required
internal resources, a focus on their core business (Gorla & Somers, 2014), or insufficient
technical expertise and knowledge (Liu & Wang, 2014) are not valid for a large financial
institution. In a large bank with a large IT department of more than 5,000 employees, the IS
activities must be a core activity because the company is heavily technology dependent, and the
internal IT resources are more trained and specialized than are outsourced resources. Thus,
outsourcing a project in this scenario does not mean enhancing project performance; however,
more research is needed to validate our proposition.

5.2. Project Manager-Level Effects

Although a more experienced project manager with formal power has the flexibility to
address unforeseen circumstances and positively influence PMS and client satisfaction (Ives,
2005; Jugdev & Müller, 2005; Petro & Gardiner, 2015; PMI, 2013), our study could not be
conclusive on this aspect. Our hypothesis that higher PM formal power has a positive effect on
PMS was not supported. This result might occur because the formal authority that is given to the
project manager based on his/her role no longer influences team members due to the more
empowered agile teams and their familiarity with new technologies, products and agile
methodologies (Serrador & Pinto, 2015). We believe that further research is needed to
understand this phenomenon.

Our study shows that high levels of project manager diversity have a positive effect on
PMS. Specialization is an important economic concept that influences the performance of an
employee; however, this concept is not valid for an IT project manager. A project manager who
can be exposed to projects of different sizes and types during his/her career is better prepared to
address unexpected situations that could affect PMS. This conclusion corroborates the previous
literature (El-Sabaa, 2001; Müller & Turner, 2010; Payne & Turner, 1999).

5.3. Team and Portfolio Network-Level Effects

The results also show that group allocation is a critical PM issue because team size,
team time-allocation dispersion, and project network closeness all reduce cost-time project
management success. Consequently, smaller, focussed and less-disperse teams can present better
results than multiple, larger and sparse teams addressing a multiplicity of projects. This
conclusion contributes to the recent literature about agile IS development, which indicates that
this model of management improves PMS (Lee & Xia, 2010).

Expanding upon the past IS research, we analyzed the team allocation into the portfolio.
Two types of resulting networks emerge, leading to opposite effects. Having individuals
originally allocated in central projects sharing hours with multiple projects reduces PMS,
whereas having individuals sharing hours with other central projects increases PMS. As we
mentioned above, central projects are usually strategic projects that are better controlled and
have the best technical teams. Thus, team members are naturally more worried about the
project’s results when working on central projects than when working on peripheral projects.
This observation aligns with previous studies (Colazo, 2010; O'leary et al., 2011; Peng et al.,
2013).
6. CONCLUSIONS

6.1. Contributions

This study contributes to the academic literature by confirming and extending the main
aspects of Project Success from a multilevel perspective. This approach allows the richest
analysis of a project environment that has become increasingly complex and addresses much
uncertainty.

Furthermore, project management theoreticians recognize that different versions of

project management are required in different circumstances according to the country, industry
sector, and size of the organization. To expand this research field, it is important to accumulate
studies from various industries around the world (Love, Irani, Standing, Lin, & Burn, 2005;
Turner & Ledwith, 2016). A myriad of factors can positively affect the success of IT projects and
reduce their probability of failure. Many researchers have been individually studying how to
improve the practices related to portfolio selection and prioritization, project techniques of
monitoring and control, project manager hard and soft skills and even team motivation.
However, recent numbers collected worldwide by some project management institutes continue
to show that 52% of the IT projects have been challenged (scope creep and lost budget) and that
19% failed (deemed failures) (PMI, 2017; Standish, 2015). Therefore, there is a need to start
exploring the interrelations of these many levels of factors to develop theories that are more
robust and help the practitioners to achieve the best levels of project performance.

Project management theory has been developed in the context of controlling the time,
cost and scope of projects. However, the theory must be expanded beyond this frontier and
consider that the project’s value must be proven, particularly in financial organizations that make
intensive use of IT in their operations and in which the success of IT projects is a strategic issue.

6.2. Practical Implications

It is the researchers' hope that the findings reported here will complement existing
research in the area of internationally recognized project management success and will be of
interest to practitioners.
 This study has shown the existence of many project management practices in the
literature, but merely adopting these individual practices is not sufficient to ensure the project
management success of IS projects. Ensuring the combined use of these practices to maximize
PMS is crucial.

Exploring the causes of a problem can enrich the understanding of a given theory and
allow readers to make more sense of complex organizational phenomena (Whetten, 1989).
Therefore, the authors recognize that any discussion of the practical implications of this study
would be incomplete if it only identified a multilevel model rather than proposing its actual use.

The findings of this study identify several managerial contributions for a better
understanding of the antecedent factors of IS success concerning multiple levels. From a project
and portfolio perspective, the results can help project and portfolio decision makers to allocate
their resources strategically to pursue a better balance among team members and across projects.
The results show that larger IS projects have better rates of PMS because they are strategic
investments to the company and adopt efficient and effective mechanisms of control. Moreover,
postponing the beginning of a project until the removal of uncertainties is also a best practice that
can positively influence project performance.

Furthermore, the model presents valuable advice for team staffing related to group size
and hierarchical diversity that can improve project success. The study also provides guidance on
how to spread team members across multiple projects, seeking a positive effect on overall
portfolio success. Additionally, it helps to understand the benefits of allowing project manager
diverseness by experiencing interaction with a multiplicity of project sizes. Surprisingly, the
results showed that the authority of a project manager based on his/her role did not influence
project performance, demonstrating that senior employees will not necessarily be the best project
managers. Finally, the findings indicate that it is more efficient to have smaller, concise and
focussed teams on an IS project than to have larger teams working simultaneously on a variety of
projects.

6.3. Limitations and Avenues for Future Research

This study is not free of limitations. First, although we were able to gather data from a
highly relevant organization in the financial service industry, some organizational policies and
cultural aspects might heavily influence the results. Second, despite the extensive research
literature concerning the factors that can contribute to project management success, not all
factors could be included in our research model. Third, this study has focussed on project
management success, whereas the quality of the ultimate software artifact is to be analyzed to
evaluate the overall project success. Fourth, we did not have access to the scope-failed projects;
therefore, our sample considered only the scope-successful projects. Fifth, because we measured
project management success with an indicator aggregating scope, cost and time dimensions,
relative success in one dimension can alleviate relative failure in others.

Consequently, further research can analyze what factors might influence the success of
management from each dimension’s perspective, and PMS can be analyzed in each dimension
concerning PS. Additionally, there is a field open to study the influence of methodologies, e.g.,
agile, on PMS and PS from the governance perspective.

Conflict of Interest

This manuscript has not been published and is not under consideration for publication
elsewhere; we have no conflicts of interest to disclose.

Acknowledgments

The authors would like to thank Miia Martinsuo, Associate Editor of the International
Journal of Project Management, and the three anonymous reviewers who provided many
valuable comments that helped to improve the paper.

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FIGURES

Figure 1 – Research Model

TABLES

Antecedents’ Level Empirical Data Measurement of Success

Reference

Manager
Portfolio

(in alphabetical

Quality
Scope /
Project
Project

Team

Time

Cost
Other Data collection Quantity Location Industry Other order)

105 Project (Agarwal &

Survey India IT
managers Rathod, 2006)
Vision,
United (Alderman &
organization, Documentation 4 Cases Government
Kingdom Ivory, 2011)
network
Project
497 IT, Government, (Ali, Anbari, &
management Survey Worldwide
participants Construction Money, 2008)
software
193 Project
(Aronson,
management United States
Vision Survey Several Business benefits Shenhar, &
members + 3 of America
Patanakul, 2013)
cases
Governance, 336 Project (Berssaneti &
Survey Brazil Several
methodology managers Carvalho, 2015)
Argentina,
(Carvalho, Patah,
Methodology Survey 1387 projects Brazil, and Several
& Bido, 2015)
Chile
Australia,
China,
Governance (Crawford et al.,
Interviews 108 interviews Europe, North N/D
and support 2008)
America, and
South Africa
(Creasy &
Organizational United States
Literature review None N/D Team Anantatmula,
dynamics of America
2013)
High-tech, (Dvir, Sadeh, &
89 Project
Survey Israel defense and Business benefits Malach-Pines,
managers
educational 2006)
United States (Eigbe, Sauser, &
Methodology Interviews 4 Programs Aviation
of America Felder, 2015)
 Business benefits
52 Project United (Geoghegan &
Survey Financial Service and product
managers Kingdom Dulewicz, 2008)
adoption
Product adoption,
customer
123 Team
satisfaction,
leaders United States (Hagen & Park,
Survey N/D commercial
125 Team of America 2013)
success, new
members
market, new
technology
Service, (Hsu, Liang, Wu,
128 Project Business benefits,
Culture Survey China Manufacturing and Klein, & Jiang,
managers team satisfaction
Others 2011)
Organization
25 members of
and Survey Finland N/D (Hyväri, 2006)
PMA
environment
Financial service
and Project
Governance Interviews 4 Interviews Australia (Ives, 2005)
management
services
France and (Joslin & Müller,
Literature review N/D N/D
Sweden 2015)
Business benefits,
254 Project (Joslin & Müller,
Methodology Survey Worldwide Several stakeholder
Managers 2015)
satisfaction
Product adoption,
customer
satisfaction, (Kloppenborg,
Sponsor 109 PMI
Survey Worldwide Several commercial Tesch, Manolis, &
Behaviors professionals
success, a new Heitkamp, 2006)
market, a new
technology
202 PMI Customer (Mahaney &
Rewards Survey Worldwide Several
members satisfaction Lederer, 2006)
Business benefits,
Governance, 154 Project United Arab (Mir &
Survey N/D stakeholders
methodology managers Emirates Pinnington, 2014)
satisfaction
Business benefits,
400 Project United States (Müller & Turner,
Survey Several stakeholders
managers of America 2007)
satisfaction
Services,
39 Project Manufacturing (Raymond &
Methodology Survey Canada
managers Public sector, Bergeron, 2008)
Construction
 Business benefits, (Savolainen,
Finland and
Literature review 7 articles Several customer Ahonen, &
Ireland
satisfaction, Richardson, 2012)
859 Project Stakeholders (Serrador & Pinto,
Methodology Survey Worldwide Several
managers satisfaction 2015)
China, Sweden, Business benefits,
The stakeholders (Shao & Müller,
Interviews 15 Interviews Several
Netherlands satisfaction, social 2011)
and the UK effects
USA, New System use,
Governance, 106 Project (Sheffield &
Survey Zealand and Financial service customer, and
methodology managers Lemétayer, 2013)
Australia team satisfaction
(Skulmoski &
Interviews 33 interviews Canada N/D
Hartman, 2010)
Service,
168 Project United States (Tesch et al.,
Survey Manufacturing Business benefits
managers of America 2009)
Others
Financial service,
Business benefits,
Mining and
stakeholders (Thomas &
Interviews 36 Interviews Australia Electricity,
satisfaction, Fernández, 2008)
Gas and Water,
system use
Supply
Project success (Thomas, Jacques,
137 United States variable was Adams, &
Documentation Several
Organizations of America coded on a 5- Kihneman-
point Likert Wooten, 2008)
Human (Zwikael &
99 Project Customer
resources Survey Israel Several Unger-Aviram,
managers satisfaction
practices 2010)
Table 1 – Previous Literature on Antecedents’ Level and Measurement of Success
 Planned Actual
Description Category
Start date End date Hours Start date End date Hours

Coding COBOL II (old version) components for COBOL

02/03/2014 01/30/2015 45,167 02/03/2014 02/06/2015 46,181 Corporate IT
Enterprise (new version)

Personal loan with a guarantee of investment funds (new

02/01/2014 03/31/2015 19,726 02/03/2014 05/05/2015 15,169 Business
product)

Personal loan with life insurance on the CORBAN channel

01/02/2014 03/31/2015 4,608 07/07/2014 05/13/2015 3,809 Business
(correspondent banking)

Audit Finding – Fix security vulnerability in the authentication

06/14/2014 09/20/2014 820 06/13/2014 10/10/2014 840 Support
process of the Call Center

Regulatory – Change calculation of private pension plans

03/03/2014 04/24/2015 1,364 08/18/2014 07/17/2015 1,304 Support
according to law #11.053

Table 2 – Characteristics of some projects selected in the sample

 Variable Mean s.d. 1 2 3 4 5 6 7 8 9 10 11
1- Cost and Time PM
0.987 0.287
Success
2- Project Size
2931 7674 -0.005
(Hs)

3- Team size (members) 9.71 10.00 0.006 0.643**

4- PM Formal Power 0.055 0.229 -0.009 0.028 0.015

5- Project Duration
261.7 143.8 0.320** 0.223** 0.275** 0.026
(Days)
6- Outsourcing Index
0.272 0.287 -0.132** 0.112** -0.096** 0.021 -0.134**
(% Hs)
7- Project Postponement
3.5 15.1 0.146** -0.008 0.004 0.003 0.051 0.098**
(Days)
8- Team Time Allocation
384.0 648.4 -0.051 0.808** 0.334** 0.070* 0.229** 0.342** 0.037
Dispersion
9- Team Hierarchical
1.199 0.642 -0.105** -0.033 -0.174** 0.074* -0.106** 0.602** 0.035 0.079*
Diversity
10- Project Network
0.318 0.088 -0.038 0.133** 0.283** -0.035 0.120** -0.054 0.028 0.057 -0.047
Closeness
11- Network Eigen.
0.094 0.211 0.025 0.157** 0.457** -0.024 0.053 -0.042 0.045 0.041 -0.196** 0.238**
Centrality
12- PM Management
0.171 0.267 0.096** 0.030 0.086** -0.019 0.096** -0.007 0.011 0.029 -0.041 0.058 0.000
Diversity
Table 3 – Descriptive Statistics and Correlations
Note: n= 899; * p<0.05 ** p<0.01 ***p<0.001
 Project Team Portfolio
Controls: PM Factors: Interaction:
Factors: Factors: Factors:
model 1 model 5 model 6
model 2 model 3 model 4
Project Size (Hs) -0.015 -0.006 0.242** 0.251*** 0.261*** 0.257***
Team size (members) 0.016 -0.091* -0.172*** -0.187*** -0.198*** -0.193***
PM Formal Power -0.009 -0.014 0.001 -0.001 0.001 -0.001
Project Duration (Days) 0.326*** 0.360*** 0.368*** 0.362*** 0.362***
Outsourcing Index (% Hs) -0.111*** -0.009 -0.020 -0.024 -0.031
Project Postponement (Days) 0.140*** 0.143*** 0.142*** 0.142*** 0.171***
Team Time Allocation Dispersion -0.270*** -0.269*** -0.274*** -0.272***
Team Hierarchical Diversity -0.067 + -0.053 -0.049 -0.047
Project Network Closeness -0.071* -0.074* -0.076*
Project Network Eigenvector 0.061 + 0.066 + 0.066 +
Centrality
PM Management Diversity 0.080* 0.080*
Project Duration_x_ -0.074*
Project Postponement
Constant -0.003 -0.004 -0.002 -0.002 -0.002 0.002
R2 0.0% 13.9% 15.6% 16.2% 16.8% 17.2%
2
R Change 0.0% 13.8% 1.7% 0.6% 0.6% 0.4%
Adjusted R2 0.0% 13.3% 14.8% 15.2% 15.8% 16.1%
F Change 0.074 47.735*** 9.003*** 3.300* 6.583* 4.667*
Model F 0.074 23.910*** 20.505*** 17.149*** 16.286*** 15.380***
Table 4 – Results of Fixed-Effects Regression Analysis Predicting
Cost-Time Project Management Success
Note: n=899; + p<0.10 * p<0.05 ** p<0.01 ***p<0.001
Level of Hypothesis Result
analysis
Portfolio H1 Higher project network closeness has a negative effect on CTPMS Supported
Network H2 Higher project network eigenvector has a positive effect on CTPMS Supported
Project H3 Greater project size has a positive effect on CTPMS Supported
H4 Greater project duration has a positive effect on CTPMS Supported
H5 Longer project postponement has a positive effect on CTPMS Supported
H6 Project duration moderates and reduces the direct effect of project postponement on CTPMS Supported
H7 Higher level of project outsourcing has a positive effect on CTPMS Not supported
Project H8 Higher PM formal power has a positive effect on CTPMS Not supported
Manager H9 Higher level of PM management diversity has a positive effect on CTPMS Supported
Team H10 Larger project team size has a negative effect on CTPMS Supported
H11 Higher team allocation dispersion has a negative effect on CTPMS Supported
H12 Higher levels of project team hierarchical diversity have a negative effect on CTPMS Not supported
Table 5 – Summary of the results of hypothesis testing