Impact of Institutional Environmental Factors on Project Performance-An Analysis on the Construction Projects in Lahore, Pakistan

Abstract

The construction industry has experienced a dramatic boom in theeconomy over the last two years, due to the significance of CPEC in Pakistan. In the project’s performance, the role and concept of Institutional Environment have been extensively studied in previous literature. However, the analysis of these strategic constructs in construction firms has been minimal. Still, a gap exists in institutional factors concerning project performance. This paper aims to address this gap posits that Institutional Environmental Factors (IEFs) may impact the performance of the construction projects; also, there may be some factors that can impede or promote the performance of these projects. Data were collected from a sample of some construction firms’ management teams through semi-structured interviews. Study results suggested that coercive & normative factors of the institutional environment have a significant impact on the project performance concerning time delays and cost escalation. However, mimetic factors have less impact. This study also tries to assimilate the importance of institutional factors with the policy-making aspects of construction firms which can affect the performance of the projects. Future implications and limitations of the study are also discussed.