Effect of Fragmentation as A Moderation on The Relationship Between Supply Chain Management And Project Performance

Abstract

Project fragmentation can be understood as breaking down the construction work into several parts due to the complexity and massive scale of a project. Initially, this division was intended to focus work on specific sectors, ensuring precision, speed, and guaranteeing Project Performance. However, high levels of fragmentation can result in a lack of integration between parts of the project, which can adversely affect both the implementation process and the final outcome of the project. One such adverse effect is project delay, which can diminish project performance, as seen in the X PEB steel construction project. Previous studies have identified an approach to improve project quality through the implementation of supply chain management (SCM). Therefore, this study examines the impact of fragmentation on SCM concerning project performance, comparing the effect of SCM on performance under conditions of high fragmentation versus when fragmentation is disregarded in the PEB steel construction project. The results show that SCM influences performance by 51%. This analysis indicates that SCM plays a crucial role in achieving the performance of PEB steel construction projects. When project fragmentation is assumed to be non-existent, SCM's influence on project performance is even greater, reaching 82%, indicating that SCM has a significant impact on project performance and serves as a solution to maintaining project performance. This study concludes that fragmentation serves as a moderating variable affecting project performance in PEB steel construction.