Models for Predicting Project Performance in China Using Project Management Practices Adopted by Foreign AEC Firms Florence Yean Yng Ling 1 ; Sui Pheng Low 2 ; ShouQing Wang 3 ; and Temitope Egbelakin 4 Abstract: China is a new market to many international architectural, engineering, and construction AEC firms and it is not known what would be the likely project outcomes, based on different project management PM practices adopted. This research developed and tested five models to predict the likely project success levels, based on PM practices adopted by foreign AEC firms in China. Based on data obtained from 33 projects, multiple linear regression MLR models for predicting the performance of foreign managed projects in China were constructed. The models were tested against 13 new cases, and the results show that they are able to predict project outcomes with some level of accuracy. The models show that certain scope management practices can be used to predict owner satisfaction, profit margin, and cost and quality performance of the project. Construction industry practitioners who are managing projects in China may benefit from the findings by focusing more on upstream management, like managing project scope, in order to ensure project success. It is recom- mended that construction industry practitioners use the MLR models to make preliminary assessment of the possibility of project success based on the type of PM practices they intend to adopt in China. From the results, they can then decide if they should change their practices or abort the project. DOI: 10.1061/ASCE0733-93642008134:12983 CE Database subject headings: China; Foreign projects; International commissions; Performance characteristics; Construction management; Models. Introduction The rapid economic expansion in China has resulted in many construction activities, which make its construction industry one of the largest in the world NBSC 2002. Problems such as cost overrun, schedule delay, low quality, and stakeholders’ dissatis- faction are frequently reported in China Wang et al. 2006. As foreign architectural, engineering, and construction AEC firms are expected to tap into these opportunities and participate in developing China’s built environment, it would be useful to know the project management PM practices that should be used to overcome these problems. This paper investigates PM practices used by international non-Chinese AEC firms in China. The study explores these firms’ practices at the project level. The specific objectives of this paper are: 1 to find explanatory variables PM practices that significantly affect the performance of projects managed by for- eign firms in China and 2 to construct and test models to predict the performance of foreign managed projects in China, based on their PM practices. The first objective is important because it identifies aspects of PM practices that foreign firms operating in China could improve on so as to achieve project success. The second objective is also important because project performance prediction models developed in this study would enable owners, consultants, and contractors to predict how successful their projects are likely to be, based on different PM practices to be adopted. The international construction focus is chosen because unlike domestic construction, international construction is marked by the combination of business and PM skills with both mobile factors of production and location-bound support industries Enderwick 1993. This study is significant because many foreign firms are entering China’s construction industry for the first time and know- ing the more critical PM practices to adopt would help to enhance project performance. In this study, an “international project” is one that is located outside the country where the AEC firm’s headquarters is based. This international project is then said to be located in the “host country,” which, in this paper, refers to China. Foreign AEC firms in this paper refer to non-Chinese interna- tional firms that are operating in China. Literature Review International Construction In addition to the typical risks of a domestic project, the interna- tional construction process has unique political, economic, and 1 Associate Professor, Dept. of Building, National Univ. of Singapore, 4 Architecture Dr., Singapore 117566 corresponding author. E-mail: bdglyy@nus.edu.sg 2 Professor, Department of Building, National Univ. of Singapore, 4 Architecture Drive, Singapore 117566. E-mail: bdglowsp@nus.edu.sg 3 Professor, Dy-Head, Dept. of Construction Management, School of Civil Engineering, Tsinghua Univ., Beijing, China 100084. E-mail: sqwang@tsinghua.edu.cn 4 Research Asst., Dept. of Building, National Univ. of Singapore, 4 Architecture Dr., Singapore 117566. E-mail: temitope_egbelakin@yahoo. com Note. Discussion open until May 1, 2009. Separate discussions must be submitted for individual papers. The manuscript for this paper was submitted for review and possible publication on January 10, 2007; ap- proved on June 2, 2008. This paper is part of the Journal of Construction Engineering and Management, Vol. 134, No. 12, December 1, 2008. ©ASCE, ISSN 0733-9364/2008/12-983–990/$25.00. JOURNAL OF CONSTRUCTION ENGINEERING AND MANAGEMENT © ASCE / DECEMBER 2008 / 983 Downloaded 27 Dec 2008 to 166.111.44.134. Redistribution subject to ASCE license or copyright; see http://pubs.asce.org/copyright