Dialogue on risk effects of project risk management on project success

PhD ceremony: Mr. K.F.C. de Bakker, 14.45 uur, Academiegebouw, Broerstraat 5, Groningen

Dissertation: Dialogue on risk effects of project risk management on project success

Promotor(s): prof. J.C. Wortmann, prof. A. Boonstra

Faculty: Economics and Business

Does project risk management contribute to project success; more specifically to success in Enterprise Resource Planning (ERP) implementation projects? The answer is provided in this thesis by conducting a combination of literature investigation, case studies and an experiment. The existing literature is barely able to demonstrate evidence that project risk management contributes to IT project success. Moreover, the literature demonstrates that assumptions on which the influence of risk management on IT project success is based, are often incorrect. In order to further investigate the relationship between project risk management and project success, an extension to the existing model is proposed. The model extension assumes that project stakeholders interact during the execution of risk management activities, and that this interaction is able to influence project success. This is an addition to the existing (instrumental or non-social) model of risk management, which itself precludes stakeholder interaction. The additional model was investigated by interviewing numerous stakeholders (project managers, IT suppliers, customers) from ERP implementation projects. Stakeholders indicate that individual risk management activities, e.g. risk identification or risk allocation, generate so called communicative effects: action, perception, expectation and relation. These effects contribute to project success; they influence stakeholders’ actions and stakeholders’ common definition of the situation. Findings from case studies were confirmed by an experiment in which the effects of a single risk management activity were investigated. Results indicate that risk identification in which the project group discusses the risks contributes to project success in terms of higher quality and valuation of the result.