Influence of formal and informal stakeholder relationship on megaproject performance: a case of China

Abstract

PurposeThe purpose of this research is to seek better relational strategies between formal and informal stakeholder relationships to improve megaproject performance.Design/methodology/approachThe conceptual model was developed with twenty hypotheses based on the literature review. Then a questionnaire survey was conducted, and the collected data were analyzed by Partial Least squares Structural Equation Modeling (PLS-SEM) for validating the proposed model. Finally, the findings were discussed by a comparative study to explain the different effects of the formal and informal relationship on megaproject performance, and the managerial implications are presented for the stakeholders to implement the relationship management in the megaprojects.FindingsThe research finding reveals that formal relationship plays a dominating role in cost, quality, and labor protection; meanwhile, it is still more reliable in improving coordination, safety and environmental protection. Both formal and informal relationship is equally important towards collaboration and scheduling while the informal relationship is more effective in communication and project transparency.Originality/valueThe study extends the knowledge of relationship management in the domain of the megaproject performance. It provides a comprehensive and systematic understanding of the impact of formal and informal stakeholder relationships on ten aspects of the megaproject performance by the proposed conceptual model and PLS-SEM results. The research findings contribute to the theory of relationship management on how the different influences between formal and informal stakeholder relationships lead to better megaproject performance from inter-organizational level to project and societal level.