Complex Projects, Complex Outcomes: A Stakeholder-Centric Investigation of Performance Challenges in the Development Sector

Abstract

This research examines the effect of project complexity (PC) on project performance (PP)— specifically delay and cost overrun—in the context of complex development sector projects in Pakistan. While prior research has acknowledged the presence of complexity in development projects, the underlying mechanisms through which it affects performance have remained largely underexplored. This research addresses that gap by thoroughly probing stakeholder management process and does so by considering stakeholder conflict (SC) as a mediating variable in the relationship between project complexity and project performance. Moreover, by assessing the moderating role of stakeholder satisfaction (SS) as well. Statistical analysis of data using PLS-SEM, gathered from 381 respondents of development sector highlighted that project complexity has significant direct effect on project performance as well as stakeholder conflict. The effect of stakeholder conflict on project performance was also found vital. In case of mediation, the intervening effect of stakeholder conflict between project complexity and performance was substantial, which establishes the vitality of effectively & timely managing stakeholder conflicts within complex projects. Lastly and interestingly, with respect to moderation, stakeholder satisfaction did not appear as a significant factor between stakeholder conflict and performance. These findings cumulatively highlight the importance of managing conflicts in diverse projects, and demonstrate that, if not managed effectively this complexity can drastically impact project performance, especially in terms of delays and cost over runs. The research holds vitality in theoretical as well as practical context.  Project management practitioners can utilize these findings and effectively manage the complexity and conflict in their projects to elevate their performance outcomes.