Project Management Maturity and Project Success in NSW Local Government

Abstract

Reforms in New South Wales (NSW) local government required councils to demonstrate that they were being efficient and effective in their day-to-day operations. At the same time regular performance reporting by the NSW state government published individual council performance data and compared performance of similar councils. The reform requirements and performance reporting both focused on operational and financial measures and did not provide direction on project performance reporting. Project performance impacts both operational and financial measures and so its inclusion in general performance reporting would allow councils to demonstrate the necessary efficiency and effectiveness required by the NSW state government.

To demonstrate a measurable improvement in project objectives a baseline measure of local government project performance was required. A literature review of project success criteria revealed that the four most common criteria were time, cost, quality (the Iron Triangle), and customer satisfaction. Measuring multiple projects against the four criteria was not feasible, and whilst the Iron Triangle can be measured objectively, customer satisfaction is a subjective measure. This led to an investigation into a solely objective performance measurement, namely measurement of organisational and industry project management maturity. In order to measure project management maturity a Project Management Maturity Model (PMMM) is used. As shown in the literature, existing PMMMs may be used across varying industries or a new model may be developed. In this case, a new PMMM was developed in the form of the Local Government Project Management Maturity Model (LGPM3). Thus the first research question was to determine the existing project management maturity levels in NSW local government. Further analysis into project management maturity in the literature revealed an inconsistency in the relationship between maturity and success. The second research question sought to add to the body of knowledge in regard to the relationship between higher project management maturity and project success.

second research question sought to add to the body of knowledge in regard to the relationship between higher project management maturity and project success.

The overall project management maturity level for NSW local government was calculated as 3.4 on a five-point scale, with a range of scores from 2.6 to 3.8. The two categories of Metropolitan and Metropolitan Fringe had the equal highest project management maturity level of 3.8. The Rural category had the lowest overall score of 2.6 and was the lowest or equal lowest in eight out of nine knowledge areas. The first stream thus answered the first research question. The second stream used the annual reports from each participating council from stream one and calculated a project success percentage. Using a correlation analysis the relationship between the two was determined to answer the second research question. A negative correlation was found whereby the data showed that as the project management maturity level in an organisation increased, the associated project success level decreased.

Whilst the relationship between maturity and success was found to be negative in this research, NSW councils could still use the LGPM3 to assess their level of maturity and address those areas of lower maturity if desired. With regard to PVT the results when assessed against Moore’s (1995) Strategic Triangle were found to have satisfied the necessary criteria and hence created public value. Furthermore, the current performance reporting mechanisms required by the NSW state government should be reviewed to mandate a consistent and auditable method of project performance reporting to improve outcomes for the NSW community.