Structural equation model of project planning effectiveness

Previous research studies investigating the impact of situational variables on project planning effectiveness have not examined how the situational variables work together to influence planning effectiveness. A structural equation model (SEM) has been developed for describing and quantifying the influence of situational factors in project environments and organizational characteristics of performing organizations on project planning effectiveness. The individual effects of directly‐observable variables on the project planning process were evaluated using regression analysis. The SEM approach enables the modelling of multiple factors as latent not‐directly‐measurable variable sets, thus providing a theoretical insight into how individual influence factors work together to determine the effectiveness of project planning efforts. The project environment has a dominant significant influence on the potential effectiveness of project planning efforts. In contrast, the influence of organizational characteristics is relatively insignificant.