Impact of Risk Management on Project Performance

Impact of Risk Management on Project Performance 1
IMPACT OF RISK MANAGEMENT ON PROJECT PERFORMANCE MEDIATED BY
LEADERSHIP EFFECTIVENESS
by [Name]
Professor’s Name
Course Title
State/City
Date

Impact of Risk Management on Project Performance 2
Table of Contents
Chapter 1...............................................................................................................................................7
1.0 Introduction.....................................................................................................................................7
1.2 Research Background..................................................................................................................9
1.3 Problem Statement.....................................................................................................................15
1.4 Research Aim............................................................................................................................16
1.5 Research Objectives...................................................................................................................16
1.6 Research Questions....................................................................................................................17
1.7 Significance of the Research......................................................................................................17
1.8 Assignment Structure.................................................................................................................18
Chapter 2.............................................................................................................................................19
2.0 Literature Review......................................................................................................................19
2.1 Definition of Key Concept.........................................................................................................19
2.2 Key Performance Measurement Models....................................................................................26
2.3 Review of Relevant Empirical Research....................................................................................43
2.4 Literature Gap............................................................................................................................48
2.5 Summary of past studies............................................................................................................48
2.6 Conceptual framework...............................................................................................................53
2.7 Hypothesis.................................................................................................................................53
H4: Impact of risk management on project performance is mediated by leadership effectiveness
Chapter 3.............................................................................................................................................53
3.0 Research Methodology..................................................................................................................54
Research Paradigm..............................................................................................................................54
Research Design/Method.....................................................................................................................55
Research Strategy................................................................................................................................56
Data Collection Method.......................................................................................................................57
Target population, sample size and sampling method.........................................................................57
Questionnaire development.................................................................................................................58
Ethical and Accessibility.....................................................................................................................58
Data Analysis Plan..............................................................................................................................59
Chapter 4.............................................................................................................................................60
4.0 Data Analysis................................................................................................................................60
4.1 Demographic Analysis...............................................................................................................60
Risk Management............................................................................................................................67
Project Performance........................................................................................................................72

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Leadership Effectiveness.................................................................................................................80
4.2 Normality Test...........................................................................................................................89
4.3 Reliability Test..........................................................................................................................90
4.4 Hypothesis.................................................................................................................................91
Chapter 5 Conclusion and Recommendation.......................................................................................92
Conclusion...........................................................................................................................................92
Recommendation.................................................................................................................................94
Future Research Opportunity...............................................................................................................95
Limitations..........................................................................................................................................95
References...........................................................................................................................................96

Impact of Risk Management on Project Performance 4
List of Table
Table 1: Performance Measurement Models...........................................................................28
Table 2: Summary of models and theories...............................................................................40
Table 3: Summary of past studies............................................................................................51
Table 4: Target population and sample size.............................................................................57
Table 5: Respondents gender frequency..................................................................................59
Table 6: Respondents age-group frequency.............................................................................60
Table 7: Respondents income frequency.................................................................................62
Table 8: Respondent's education frequency.............................................................................63
Table 9: Respondents type of business operation frequency...................................................64
Table 10: Risk management approach impact on performance...............................................66
Table 11: Respondents opinion regarding importance of risk management in managing
projects.....................................................................................................................................66
Table 12: Formal/informal risk management process..............................................................67
Table 13: How Risk management contribute to project performance.....................................67
Table 14: Risk management influence project on managing behaviour..................................68
Table 15: Role played by experience/competence levels to risk management........................69
Table 16: Respondents view about how completed project meets project expectations.........69
Table 17: Response regarding how KPIs act as a performance monitoring tool.....................70
Table 18: Response regarding how organisational leadership review influence project
performance..............................................................................................................................70
Table 19: Response about how organisation identify potential risks and address them..........71
Table 20: Response regarding how all project are delivered within a financial budget..........71
Table 21: Respondents showing how all project are completed with very minimal complaints
..................................................................................................................................................72

Impact of Risk Management on Project Performance 5
Table 22: Response regarding how leadership teams seriously look into the complaints as part
of future project improvement.................................................................................................72
Table 23: Competency and relevance experiences are key factors in project members..........73
Table 24: Leadership team look into complaints to improve projects.....................................74
Table 25: Leaders talk about trends that influence how employees work...............................74
Table 26: Leaders describe a convincing image of what employees would look like in future
..................................................................................................................................................75
Table 27: Leaders speak with honest principles regarding higher meaning and purpose of
employees.................................................................................................................................75
Table 28: Leaders seek challenging opportunities to test their abilities..................................76
Table 29: Leaders challenge employees to be innovative........................................................76
Table 30: Leaders ask employee to learn when things go wrong............................................77
Table 31: Leaders experiment and take risk in case of failure.................................................77
Table 32: Leaders seek innovate ways to improve performance.............................................78
Table 33: Leaders develop cooperation with employee...........................................................78
Table 34: Leaders involve employees in decision making......................................................79
Table 35: Leaders allow employees freedom on how to work................................................79
Table 36: Leader ensure employee growth..............................................................................80
Table 37: Normality test...........................................................................................................80
List of Figures
Figure 1: Respondents gender distribution..............................................................................60
Figure 2: Respondent's age-group distribution........................................................................61

Impact of Risk Management on Project Performance 6
Figure 3: Respondents income distribution..............................................................................62
Figure 4: Respondents education distribution..........................................................................64
Figure 5: Distribution of respondent's business operations......................................................65

Impact of Risk Management on Project Performance 7
Chapter 1
1.0 Introduction
Risk management is acknowledged as a vital exercise toward realising better performance
amongst projects. Success in any project is determined by its performance in realising the
project cost, time, safety, quality as well as environmental sustainability goals. In this sense,
risk management is essential in a project to avert incurring additional costs and time. The
concept of risk management emerged as a continued procedure that is trailed by any project
to unmask the risks related with its practices as well as execution (Carvalho & Rabechini
Junior, 2015). In this sense, risk management is concerned with the investigation of the risks
involved in the project so as to allow the project management to deal with upcoming risks
and challenges that are likely to hamper the project. On the same note, risk management
results in the effective utilisation of resources which impacts on the success of the project
(Rabechini Junior & Monteiro de Carvalho, 2013). Schedule and cost performance are the
major aspects for measuring the success of a project. Recent studies have shown that a project
is said to be successful when it is accomplished within time and planned budget (Cooper,
2015). However, many projects particularly in the developing countries are faced by the
problem of resource scarcity. Projects plays a big role to the economy of most countries
across the world. For instance the construction project sector significantly contributes to the
Gross Domestic Product (GDP) in addition to creating employment opportunities, hence it is
considered a key for the economic development of a country (Baldry, 2018). Therefore,
projects plays a socio-economic development which has various effects.
It is important to understand exactly what it means by risk prior to managing it. Risk as well
as uncertainties are inherent in all projects regardless of the size. Project are plagued by risk
because of their processes, nature, setting and organisation. In this regard, projects keeps on

Impact of Risk Management on Project Performance 8
being faced with unfavourable and unforeseen factors. Generally, projects calls for a lot of
resources as well as experts from various fields which are related to each other. Accordingly,
such complexity are further compounded by unique features that are distinctive outcomes of
production. Therefore, when it comes to managing risks it is essential to coordinate and
communication among the ad-hoc project teams.
The Association for Project Management asserted that risk is unavoidable in any project thus
the reason as to why risk management is a quickly developing management instrument in
many projects (Amoah & Pretorius, 2019). This has been made possible through the
realisation of the significance of risk management as an integral component of project
management. Risk management is one of the most essential process as well as ability to cope
up with risks associated with projects and uncertainties (Golini, Kalchschmidt, and Landoni,
2015, p.653). To be able to rescue the poor image of the project performance, the best
approach is to implement a risk management process. Through the implementation of risk
management, the most common problem in many projects like unsafe working setting, delay
in project deliver, unsatisfactory product quality and over budgeting among others. As a
result, it is argued that risk management is a vital instrument particularly when it comes to
decision-making process in relation to risks (Thomas, and Marath, 2013, p.236). Nonetheless,
it is not easy to attain efficient risk management in many projects. Effective risk management
is a key challenge to most project managers. While it is not possible for project managers to
foresee the future, they are in a position to anticipate risks which are inherent in the project
and manage these risks prior to them happening (Qazi, Quigley, Dickson, and Kirytopoulos,
2016, p.1185). In regard to project performance planning is of great significance to ensuring
project success. Planning is a continuous process through delivery of a project. Various
empirical studies related to project management success aspects have asserted that planning is

Impact of Risk Management on Project Performance 9
a key contributor to project success. Therefore, all project managers are supposed to prepare a
solid project plan and keep to this plan throughout the project.
Risk is regarded as the main concern for experts who deal with project, particularly since the
financial crisis of 2008 that shook the whole world. In general project risk commonly indicate
unfavourable conditions in a project. There is guarantee on any given project, since even
those that are carefully planned also run into trouble where even the simplest activity could
turn into unpredicted problems which could change the end product of the project activity
(Kliem & Ludin, 2019). Thus, regardless of how well a project is planned, project will always
encounter unexpected problems. Project risk management is considered a procedure that
consists of several stages running from initiation, planning, execution, control up to closure
phase. Decision milestones are utilised to anticipate outcomes hence risk management is
carried out to prevent problems (Bañuls, López, Turoff, & Tejedor, 2017). As a result, logical
iterations are used to make sure that the desired facilities are available.
1.2 Research Background
Risk Management
While risk is widely researched, there is no uniform definition that exists for risk, which
means that the description for risk is still faulty. In general, risk is an event that
conventionally is likely to happen, and its occurrence could lead to negative effects to the
outcome of the project in terms of quality, time, and cost as well other significant
performance measures (Joslin, and Müller, 2016, p.366). With regard to Marly (2015) it is
necessary to have relevant techniques to plan as well as cope with project uncertainties and
risks. As such strategies that is risk management are supposed to be easily comprehended,
used and implemented by the project group. In other words, risk management is foreseeing
the unforeseeable. Accordingly, this a highly significant instrument that aids in controlling

Impact of Risk Management on Project Performance 10
risks associated with projects (Crispim, Silva, & Rego, 2019). In the same way, the
Association for Project Management 2017 describes risk management as the criteria that
allows the assessment and analysis of project risks. Bañuls, López, Turoff, and Tejedor
(2017, p.97) argued that risk management is a vital component of decision making process in
any project. Also, project management researchers assert that risk management is a central
element of organisational process and not just a set of techniques and tools (Fabricius, and
Büttgen, 2015, p.231). Therefore, risks management is a process where the project team
solely address project uncertainties and risks. In this sense, the project manager logically
assess and analyse project risks based on the best information. Risk management is relevant
in projects because it create value to the project team since it unblocks successful project
practices and portfolio (Sirisomboonsuk, Gu, Cao, and Burns, 2018, p.290). This increases
the possible benefits of project performance in terms of schedule, budget and quality when
risk management is done in an appropriate manner.
Background of Schenker Logistic (Malaysia) Sdn Bhd
Schenker Logistic Malaysia Sdn Bhd was founded in 1979 as a subsidiary of Deutsche Bahn
AG. Currently, this organisation has 15 outlets across Malaysia and has an employee
population of more than 1300. The organisations offers freight forwarding as well as 3PL
which is a third party logistics services like ocean Freight Forwarding, international Air,
Land transportation, Fairs and Exhibition, project service removals, custom clearance and
distribution, transit storage and warehousing. In the past few years, Schenker Logistic has
been experiencing high turnover among its employees’ particularly middle management
operators (Azimi, Zakaria, and Majid, 2019). The high rate of turnover is as a result of
ineffective leadership and lack of staff motivation by the company management.
Risk Management and Project Success

Impact of Risk Management on Project Performance 11
In order to enhance the possibilities of a proposed project to succeed, it is essential for
organisations to be conversant with the probable risks, quantitatively and systematically
evaluate these risks, anticipate probable causes and effects as well as select the best methods
to deal with these risks (Anantatmula, and Fan, 2018, p.250). Therefore, so as to make sure
that any probable risks are managed in an effective manner, the risk approach ought to
explicitly be developed into decision-making process (Costantino, Di Gravio, and Nonino,
2015, p.1745). In this regard, risk management is a significant instrument to cope with such
substantial risks among projects by analysing and controlling risks to reduce loss, assess and
ascertain project viability, avoiding risks through proper planning and averting projects that
are not satisfactory hence increasing profit margins.
Through the use of principles of risk management helps to support quality improvement as
well as improving cost estimation through identifying and mitigating probable risks before
commencement of a project (De Carvalho, Patah, and De Souza Bido, 2015, p.1510). Indeed,
risk management work to ensure that project activities are put in place to make sure the
management receives well-planned risk information in advance to ensure successful
development of the project (Papadaki, Bakas, Karamitsos, & Kirkham, 2019, p.). The
principles of risk management rises the involvement of project teams in projects by giving a
suitable mechanism for reporting possible problems, which increases the team’s stake in the
entire project success (Pimchangthong, and Boonjing, 2017, p.579). Embedment of risk is a
long-term practice that is used to ensure that risk consideration is the central point of the
decision-making process (Pimchangthong & Boonjing, 2017, p.32). Certainly, lack of taking
into consideration risk matters could result into severe repercussions to the project.
Leadership Qualities in Relation to Risk Management

Impact of Risk Management on Project Performance 12
The quality of a leader in terms of decision making plays a key role in determining the
effectiveness of risk management within an organisation (Kaplan, and Mikes, 2012, p.50). An
effective leaders understand the way in which to improve workforce motivation and how to
make employees loyal to their enterprises. The ability to empower employees is mainly based
on the organisation’s capability to exhibit leadership style to improve the involvement as well
as establishment of a secure setting, whereby employees feel comfortable to express their
views (Urbański, Haque, & Oino, 2019, p.25). Furthermore, organisational culture is another
contextual aspect which plays a significant part for the success of management in an
organisation in addition to leadership (DuBois et al., 2015). Nonetheless, studies regarding
organisational culture and risk management are still limited. Accordingly, making
organisational culture an organisation’s key aspect when it comes to execution of risk
management. As a result, issues such as organisational culture, in addition to leadership styles
primarily impacts the execution of risk management in most projects within Malaysia
(Pimchangthonga & Boonjingb, 2017).
Leadership Style
The leadership style applied by a manager or head of an enterprise plays a key role toward
determining the culture of that company (Yahaya & Ebrahim, 2016). Each leadership style
applied by a leader has its consequences as well as risks. Therefore, a leader should possess
the right leadership styles in order to determine the manner in which the organisation will
rum its day to day activities (Anderson & Sun, 2017). Accordingly, leadership is a complex
aspect that is affected by a number of situations, relationships, personalities in addition to
other factors in its field of endeavour (Garg, and Jain, 2013, p.48). Leadership in most cases
is described as a process that directly influence a team of individuals within an organisation.
In this regard, an effective leadership is that leader who succeeds in establishing changes
within an organisation, particularly at time of critical times as well as unpredicted chances in

Impact of Risk Management on Project Performance 13
the external setting (Anderson & Sun, 2017, p.80). Therefore, leadership influence has been
found to be highly influential in terms of improving organisational performance of any
organisation. Effective leadership style can be viewed directly through decisions as well as
actions undertaken by leaders (Cunningham, Salomone, and Wielgus, 2015).
Risk Management Implementation
Research has shown that each activity within an organisation will inevitably experience a
range of risks which are likely to impact the achievements of corporate objectives. Risks
could obstruct the attainment of corporate goals (Marcelino-Sádaba, Pérez-Ezcurdia,
Lazcano, and Villanueva, 2014, p.328). Environmental changes which happen making
organisations to utilise active risk management strategies such as Enterprise Risk
Management (ERM) has become a vital resources toward developing risk management
systems. Enterprise Risk Management is defined as a process that is influenced by the board
of executives among other experts and applied across the whole business (Petrovskaya,
Zaitseva, Bondarchuk, Grigorieva, & Vasilieva, 2016, p.2573). The objective of ERM is to
identify potential activities that are likely to affect the project entity and manage risks by
providing appropriate assurance to achieve entity objectives. The ERM work in three ways.
First, ERM calls for the integration of risk structure of an enterprise, secondly, ERM needs
the integration of strategy to transfer the risk and lastly ERM demands the integration of risk
management for the organisation’s processes. As compared to other defensive strategies for
addressing lower limits of risk as well as earnings, enterprise risk management optimises
organisational performance through supporting and influencing resource allocation, costs and
other organisational decisions (Chapman, 2019).
Leadership and risk management

Impact of Risk Management on Project Performance 14
Taking responsibility at the top leadership of an organisation for embedding risks is key to
effective risk management.
Responsibilities
Risk managers understand the essence of gaining support from the top organisational
management, hence they outline responsibilities early enough (Tupa, Simota, & Steiner,
2017, p.1224). Since the success of an organisation as well as survival is based on careful
execution of risk management, thus it is significant that the top leadership have an overall
responsibility for risk management. In most cases, a dedicated Chief Risk Officer is tasked
with the responsibility to report to the Chief Executive Officer (Alhawari, Karadsheh, Talet,
and Mansour, 2012, p.52). In the past, organisational risks were seen as an obstacle unlike as
a necessity, nonetheless, currently, organisations have begun to realise its relevance.
According to a survey by the Harvard Business Review, it has found that over 75%
organisation, the top management are held accountable for risk management, an indication
that it is being taken seriously (Dabke, 2016, p.28).
Communication
Research has shown that for manager to change the manner in which the project team works
or thinks, to involve them begins with communication from the leaders. Indeed, explaining
and sharing the project’s risk management framework, procedures and individual’s
responsibilities have to be continuous, and consisted (Choi, Kim, & Kang, 2017, p.380).
Sending a single email to all employees from the project manager in addition with a copy of
the organisational framework attached that is never mentioned again cannot effectively
implement a risk culture (Chipulu et al., 2014, p635). According to the survey by Harvard
Business Review it shows that the chief risk officer plays a critical part in communicating the
risk culture within an organisation (Carvalho, and Rabechini Junior, 2015, p.324). Research

Impact of Risk Management on Project Performance 15
has shown that people flow their leaders, thus if the chief risk officer and the CEO all share a
similar message, it will be supported by dissimilar management levels ad line managers.
Prioritising risk throughout the organisation
Although top management teams in most organisations take risk management with a lot of
keenness, the priories of the risk manager and those of top executives often differ (Asrar-ul-
Haq & Kuchinke, 2016, p.57). Generally, the chief executive officers are concerned with,
political, economic, external and technological risk factors (DuBois et al., 2015). These are
risk factors that shareholders will probably hold them accountable. Therefore, the chief risk
officer is tasked with the responsibility to take care of all risks within an organisation (Ricard,
Klijn, Lewis, & Ysa, 2017, p.134).
1.3 Problem Statement
In the past there has been many studies that have unmasked and talked about the effect of risk
management on the performance of project (Marly, 2015) and (Lawrence, 2015). On top of
the above researchers stated above, there is also a research regarding leadership efficiency on
project presentation such as (Khatab and Leroy, 2016) and (Juanjuan, 2014). However, there
are little empirical studies conducted regarding risk management of leadership efficiency.
Most of the above stated studies regarding risk management of leadership effectiveness,
however, no single study has critically talked about the impact of risk management on project
performance intermediated by leadership performance.
Risk Management in Malaysia
Risk management in Malaysian projects is still in its infancy hence only a few organisations
as well as industrial professionals are using the tools and techniques of risk management. For
instance, the Malaysian construction industry has a poor image in terms of managing risks.
The stage of risk management identification in construction is totally dissimilar from other

Impact of Risk Management on Project Performance 16
projects. Majorly, this is based on the features of the construction projects where it begins at
the initiation phase. In Malaysia project contractors apply direct, fast and inexperienced
approaches for identifying risks. However, risks analysis calls for efficient training, proper
experience, and use of risk management software as well as professionals to provide advice
regarding the suitable response approaches to identify risks.
Contractors in Malaysia the focus of risk is based on events with a great possibility of
happening and high impact. On the same note, not all organisations carry out acceptable
operations with regard to reviewing, reporting and monitoring risk management activates in
progress. Yusuwan, Adnan, Omar, and Kamaruzaman (2013, p.121) ague that risk
management in Malaysia is still in its infancy almost in all project industries. In addition to
that, Rashid, Adnan, and Jusoff (2014, p.26) concurred with Yusuwan, Adnan, Omar, and
Kamaruzaman (2013) that Malaysian practitioners are supposed to be active in practising risk
management. On the same note, confirmed that risk management is a challenging matter in
most projects in Malaysia because of lack of knowledge and skills. Making matters worse,
most contractors are very willing to utilise risks management instruments to bring down
operational costs associated with projects. The understanding of most Malaysian contractors
based on the advantages as well as impacts related to risk management are quite low. A
recent research has shown that risk management is only put into practice by companies with
high reputation with stable financial status in addition to those organisation that deals with
big projects. At the same time the number of practitioners in Malaysia are a few (Kang et al.,
2015, p.373). Projects in Malaysia are still in need of a better understanding of the risks
factors even though risk management strategies has been developed, most of them are not
well structured hence they are not being applied in the right way. In light of this, most
Malaysian projects experience high risks.

Impact of Risk Management on Project Performance 17
1.4 Research Aim
The aim of this study is to assess the impact of risk management on performance of project
intermediated by leadership efficiency.
1.5 Research Objectives
To determine the impact of risk management on the performance of project
To identify the impact of risk management on leadership effectives
To analyse the impact of leadership effectiveness on project performance
To evaluate the mediated effect of leadership effectives on the relationship between risk
management and project performance
1.6 Research Questions
What is the impact of risk management on project performance?
What is the impact of risk management on leadership effectiveness?
What is the impact of leadership effectiveness on project performance?
What is the mediated effect of leadership effectiveness on the relationship between risk
management and project performance?
1.7 Significance of the Research
This research topic is highly significant to various sectors. Many studies have been carried in
regards to the impact of risk management on project performance, and the impact of
leadership on project performance. Therefore, this paper combines the impact of risk
management and leadership effectiveness on project performance. In this light, this study will
benefit a number of people such as researchers, organisations, project managers and scholars
by providing them new knowledge about the impact of risk management and leadership
effectiveness on project performance.

Impact of Risk Management on Project Performance 18
This study will be of great benefit to organisations whereby it will help organisational
management to understand the manner in which leadership effectiveness and leadership
styles contribute to project performance in terms of risk management.
Also, this study will be of benefit to managers from different organisations. Organisations
experience different risks hence through knowledge gained this topic will help them to
advance key leadership skills for managing teams. Possession of the right leadership skills
play a critical role towards addressing risks faced by projects within organisations. For the
employees, this study will benefit them by providing them with skills and knowledge on how
to deal with different risks when undertaking their activities.
For scholars this research will benefit them by providing them with information on the
appropriate leadership styles for managing projects.
1.8 Assignment Structure
Chapter 1: This section provides an overview of the research topic through the introduction,
research background, research aim, research objectives, research questions, and research
structure.
Chapter 2: This study part it will provide a literature review related to the research topic. The
literature review will critically review both international and Malaysian context risk
management, effective leadership and its relationship with risk management and how it
contributes to project performance. In addition to that, various leadership theories are
discussed and how they impact on the performance of projects particularly in relation to risk
management.
Chapter 3: This part of the study covers the methodology which consists of a research
paradigm, research design, research strategy, data collection methods, data instruments, target
population, sample size and method, ethical and accessibility data analysis plan.

Impact of Risk Management on Project Performance 19
Chapter 4: This parts of the research deals with data analysis using SPSS software package
and discussion of the outcome.
Chapter 5: This part provides conclusion, and recommendations and a summary of the
findings of the research as well as its limitations.

Impact of Risk Management on Project Performance 20
Chapter 2
2.0 Literature Review
2.1 Definition of Key Concept
This section of the research, the target of the researcher is to discuss definitions of the
dependent as well as independent variables from different researchers starting from the earlier
ones to the most recent in regards to the topic under investigation.
Risk Management
Carvalho, and Rabechini Junior (2015, p.321) defines risk management as the process of
identifying, evaluating as well as controlling threats to a business’s earnings and capital. The
risks or threats stems from a wide range of sources such as strategic management errors,
financial uncertainties, natural disasters and legal liabilities. According to Gurd, B. and
Helliar, (2017, p.92) risk is everywhere, hence organisations and individuals have three
choices when it comes to dealing with risk. To begin with risk is dealt with through denial
where risk is not acknowledge to exist (Tupa, Simota, & Steiner, 2017, p.1223). In the real
world situation actions and consequences are systematic thus there are no unpleasant
surprises. The second way of handling risk is fear where one takes an opposite path to allow
the existence of risk to determine the factors of a behaviour (Petrovskaya et al., 2016,
p.2572). Shying away from risks through the protection of insurance and risk hedges, people
anticipates to be spared of the worst risk manifestations. However, none of this strategies puts
one in a better position to take advantage of risks. On the other hand, a third choice is
acceptance of risk existence, this is being realistic about the odds and consequences
associated with risk as it allow organisations or people to develop the best approaches to
dealing with the risk (Shad & Lai, 2019). Risk management is therefore a significant part of
the management process for all projects. There are a number of models and theories that have

Impact of Risk Management on Project Performance 21
been put forth in regard to the subject matter related to risk as well as decision making under
uncertainty. Risk among projects has been an issue of concern due to cost overruns and time
(Pimchangthonga & Boonjingb, 2017).
Theoretical review
Decision are supposed to be made based on all aspects of influence in addition to decision-
making processes to result in predictable outcomes. Nevertheless, in most cases decision
making takes place based on risk conditions of uncertainty and risk. Most project do not run
based on ideal conditions of uncertainty (Taherdoost & Keshavarzsaleh, 2018). Decisions are
made based on risk conditions if the decision maker has the ability to rationally assess the
level of uncertainty, and the possibility of occurrence of a given event with the help of
information using past events and personal experience (Kock, and Georg Gemünden, 2016,
p.670).
Prospect theory is a decision-making theory under conditions of risk. Decisions involve
internal conflict over value trade-offs (Amoah & Pretorius, 2019). This theory advanced to
better explain, describe as well as predict the choices which a typical person can make in the
world of uncertainty (Horita et al., 2015, p.86). In this sense, prospect theory address the
manner in which these choices are structured and assessed in the process of making decisions
(André et al., 2017, p.886). Therefore, prospect theory advances the ideology that utility
curves vary in domains of gain from those of loss. The prospect theory has been designed to
describe a collective choice pattern. Prospect theory is empirical and descriptive in nature
where it looks at two sides of decision making: framing and evaluation phases (Fan &
Stevenson, 2018). Framing phase is the approach through which a choice is affected by the
way in which it is put forth to a decision maker (Pertheban, and Arokiasamy, 2019, p.583).
On the other hand, the evaluation stage of prospect involves two parts that is weighting

Impact of Risk Management on Project Performance 22
function and value function. Value function is described based on gains and losses in
contradiction to reference point not in terms of absolute wealth (Aven, 2016, p.3). In regard
to prospect theory, value is a function of change with the aim of the starting point to either
change positively or negatively.
Prospect theory predicts the domains that affects risk susceptibility. Losses have been found
to have highly emotional effects as compared to equivalent gains amount thus weighted more
heavily in terms of decision making (Orojloo, Shahdany, and Roozbahani, 2018, p.1363).
When it comes to making decisions, a decision maker multiplies the value of every outcome
with its decision weight. Therefore, decisions does not solely serve as measures of perceived
probability of an outcome, nonetheless it represents empirically derived analysis regarding
the way individual reach at their sense of likelihood (Andersen & Sax, 2019). The most
significant function of weighted function is where low chances are overweighed whereas
medium and high probabilities are subjectively underweighted.
Leadership Effectiveness
Research has shown that there is no organisation that has succeeded world over without the
existence of effective leadership (Pinho, and Santos, 2020). According to Carvalho, and
Rabechini Junior, 2015, p.337) effective leadership is the most key drivers for organisational
innovation, development and growth. It should be noted that effective leadership is not all
about titles but is about how profound, impactful as well as meaningful. On the same note,
effective leadership is mainly concerned with implementing the visions of an organisation in
addition to redefining as well as enhancing the project by setting pace and culture for
organisations (McCaffery, 2018). The purpose of leadership is planning, securing of
resources in addition to seeking for and improving on flaws (Renz, and Herman, 2016). It is
therefore, significant to note that leadership is dissimilar from managing. While management

Impact of Risk Management on Project Performance 23
is a central point of achievement of an organisation, it is basically dissimilar leadership.
Basically, it is not possible for an organisation to keep on evolving and growing in terms of
performance without effective leadership.
The role of an effective leader is key for organisational performance. Leaders who are
effective help to develop progressive organisational cultures, classify organisation visions
and objectives, and establish workforce motivation in addition to guiding the entire
organisational efforts towards greater outcomes and performance (Datta, 2015, p.22). All this
is as a result of the instrumental part played by effective leaders whose role is to guard the
benefits of organisations by managing risks and integrating resources to attain organisational
goals as well as objectives (Hillson, and Murray-Webster, 2017). Evidence has shown that
leadership is not only a set of orders and directives issued by a manager and obeyed by
subordinates, but is a collective capability of the team to guard the benefits of an organisation
to realise the needs of employees (Cooper, 2015, p.50). Effective leadership is an interactive
practice of strategic competence, environmental knowledge as well as trustworthiness
amongst subordinates. According to Katou (2015, p330) strategic competence among
organisational leaders’ aids in developing a strategic fit between objectives and goals of
organisations with its external setting.
Effective leadership establishes a relationship through which a leader motivates team
members to give their best by providing support for development and rewarding subordinates
(Zhao, Hwang, and Lee, 2016, p.151). Leaders who are effective utilise both psychological
and material resources of themselves as well their teams with the best approaches for
accomplishing tasks. The significance of organisational leadership is evident since it has for
long time been a critical area of interest among scholars (Macdonald, Burke, and Stewart,
2018). Indeed, leadership plays a primary role in organisations. Higgs, and Dulewicz (2016)
suggest that leadership role cannot be undermined in any company since it greatly impacts on

Impact of Risk Management on Project Performance 24
the performance of an organisation. On the other hand, leadership is argued by some
academicians to be one of the most essential driving forces for improving organisational
performance (Katou, 2015). Also, it is suggested that an effective leader creates great
reputation as well as goodwill for an organisation is the typical component used to determine
the success or failure of an organisation. An effective leader builds the vision of an
organisation, determine the right directions to be followed, as well as develop strategies to
attain long term organisational objectives. This is an illustration that effective leadership is a
vital role within organisation performance. Consequently, Datta (2015, p.27) views
leadership as a key to success for both public and private organisations. It is greatly believed
that leadership creates a key connection between procedures, and individuals in organisations
to result in better organisational performance.
According to effective leadership helps in blending strategic, motivational and managerial
skills. Managers utilise energy in an appropriate manner to inspire as well as motivate teams
towards attaining a common objective (Hornstein, 2015, p.294). In the same way, effective
leadership is believed by most researchers to be a basic necessity for enabling and improving
organisational performance. Effective leadership allows organisations to encounter
challenges.
Project performance
Jacob, Madu, and Tang (2012, p.235) define performance management as a process used by
organisations to attain their goals and objectives. This process is achieved through activities
performed by people who are part of the organisation. On the same note, performance
management entails goal setting and managing these goals by comparing organisational
achievements with the anticipated outcomes. By understanding the performance ability it
gives information that provides guidance as well as control at organisational level, which is a

Impact of Risk Management on Project Performance 25
suitable approach to increase its value. Therefore, performance value is a procedure used to
quantify actions in which the measurement reflects to the process of quantification as well as
action that leads to the outcome. Oppong, Chan, and Dansoh (2017, p.1039) argue that
performance measure is an approach of data collection which can be utilised to provide
information that is beneficial to individuals who have the responsibility of making decisions
within an organisation.
Performance is a matter that is usually discussed but it is rarely defined. As a result,
performance is only quantified using measures that are often implemented using indicators.
In accordance to Jacob, Madu, and Tang (2012, p.237) indicators are vital in an organisation
because they are used to measure what needs to be measured and regulate the limits within
which the performance should range. The performance level attained by an organisation is
found on the effectiveness and efficiency of the actions undertaken by the management.
Accordingly, efficiency is based on the correlation between production and inputs with the
attention paid on the production process measures as well as allocation of resources. On the
other hand, effectiveness of an organisation is built on the concept of right outputs of the
process (Madushika, Perera, Ekanayake, and Shen, 2018, p.4). The capacity of the
management is associated to actions plans to complete organisational objectives in addition to
the actions implemented after evaluating the performance plan.
Performance measurement at project level
The origin of performance measurement concept can be traced back to the mid-20th century
when financial indicators was first applied in the accounting sector (Kerzner, 2017). The
performance management systems were basically established for three reasons: to attain
goals, to evaluate, control and improve processes and to benchmark performance (Berman,
De Sousa, Linder, and Misky, 2016, p.311). Nonetheless, towards the 1990s change was

Impact of Risk Management on Project Performance 26
introduced in regard to the purpose of measuring performance towards attaining customer
satisfaction as well as product quality (Todorović et al., 2015, p.773). From that point, several
systems as well as frameworks have been developed that consists of non-financial indicators
like customer satisfaction, quality in addition to innovation in such systems (Arnaboldi,
Lapsley, and Steccolini, 2015, p.22). In general the concept of performance management
system improvement has undergone three generations. The first generation only designed the
measure for financial dimensions (Kassou, 2019). The second generation was concerned with
success strategies which it deployed them in the process. The third generation connected the
financial dimension together with non-financial dimensions with the concept of cash flow.
Performance measurement systems at organisational level
In the early 1980s performance measurement was introduced in public organisations for
purposes of boosting the effectiveness as well as efficiency of managers and organisations as
a whole (De Carvalho, Patah, and De Souza Bido, 2015, p.1510). The main performance
measures comprised quality of service, efficiency, effectiveness and productivity; these
measures reflected the organisations objectives and priorities. In this sense, Yun, Choi, De
Oliveira, and Mulva (2016, p392) has connected the understanding of performance measures
system as a data system that is utilised to refine a number of practices aligned to an
organisations long-term goals. Nonetheless, Madushika, Perera, Ekanayake, and Shen, (2018,
p.7) argue that in order to avoid measurement crisis the measurement system should evolve.
Culture, people, process and infrastructure have been found to be the factors that affect the
evolution of the measurement systems (Smith, and Bititci, 2017, p.1209). In regard to this
understanding, it has been emphasised that performance measure system ought to have the
ability to report changes in the organisation’s internal and external settings (Cadez,
Dimovski, and Zaman, 2017, p.1455). This can be realised through redefining and reviewing
the organisation’s priorities, updating objectives and transforming them into essential areas in

Impact of Risk Management on Project Performance 27
addition to improving deliverables on a regular basis (Bititci, Cocca, and Ates, 2016, p.1573).
As a result, performance measurement at organisational level is supposed to answer questions
such as is the company realising its objectives? How is the performance of the organisation?
How much has the business improved since the last time?
2.2 Key Performance Measurement Models
Performance measurement is a process that is used for collecting, analysing and reporting
information about the performance of an organisation. In this case, three performance
measurement models are considered: Malcolm Baldrige Criteria model, balance scorecard
model and key performance indicator model.
Malcolm Baldrige Criteria for Performance Excellence (MBNQA)
In the 1980s the leaders of the United States realised that it was high time organisation in
America paid attention on quality to compete favourably in the ever expanding and
competitive international market. Therefore, Malcolm Baldrige who was the secrary of
commerce advocated for organisational assessment as well as quality management as the
pillar to the United States sustainability and prosperity. The Baldridge Award criteria was
advanced by the United States of America Public Law in the 1980s with the aim of improving
competitiveness among organisations (Silvi, Bartolini, Raffoni, and Visani, 2015, p.194). The
essence of the Baldrige Award was about how to satisfy customers and the performance of
organisations in six leadership dimensions: human resource, information and analysis,
customer satisfaction, strategic planning, business results and product quality and deliverable
service (Arnaboldi, Lapsley, and Steccolini, 2015, p.4). Basically, MBNQA provided much
attention to customer satisfaction and leadership; nonetheless, in the recent years there has
been a shift to operation results as well as quality.
The Balance Scorecard (BSC)

Impact of Risk Management on Project Performance 28
The balance scorecard was developed early 1990s by Norton and Kaplan as novel
methodologies for measuring organisational performance base on the following financial
dimensions: innovation, business process, and customer (Moulang, 2015, p.520). Debnath,
Roy, Chatterjee, and Kar (2018) defines as a strategic management performance metric that is
used to identify as well as improve different internal business functions in addition to how
they result in external outcomes in an organisation. The balance score card measures four
primary factors of a business: customers, learning and growth, finance and business
processes. Through the use of the balance scorecard, organisation are able to easily identify
factors that obstruct its performance and highlight strategic changes tracked for future
scorecards (Ofurum, Afodigbueokwu, and Ezejiofor, 2019). Consequently, the balance
scorecard model is significant because it reinforces good behaviour within an organisation.
This is made possible by use of the balance scorecard because it offers information in regards
to the company’s entire objectives. Therefore, the balance scorecard model is used to
implement strategy mapping to determine the value outlined in an organisation. Organisation
utilise balance scorecards to develop strategic objectives and strategic initiatives.
Key Performance Indicators (KPIs)
The Key Performance Indicator was used in 1961 in organisations by D. Ronald Daniel to
realize business strategy (Anand, and Grover, 2015, p.137). This performance measurement
indicators theory is driven by the concept of benchmarking. KPIs have been developed and
improved by organisations in the Movement of Innovation with the intent to enhance
performance measurement (Heffernan, and Dundon, 2016, p.219). The KPIs are used to
evaluate performance practices that are regarded as crucial success features to achieve the
desirable organisational goals (Arena, Azzone, and Bengo, 2015, p.650). The KPI process
commences with measurements and then benchmarking to obtain information for purposes of
decision-making for improvements.

Impact of Risk Management on Project Performance 29
Variable Definition Author
The Malcolm Baldrige
criteria
It is a criteria for
performance excellence that
provides a framework that
should be used to improve
the general organisational
performance. This criteria is
structured into seven groups:
customer focus, strategic
planning, leadership,
measurement, analysis and
knowledge management,
workforce focus, results and
process focus.
Mellat-Parast, and Jones,
(2019)
The Baldrige Performance
Excellence Program
It is a customer-oriented
federal change agent which
develops and distributes
evaluation criteria.
The criteria enhances
performance excellence to
provide international
leadership in learning and
sharing successful strategies,
principles, methodologies
and performance practices.
Mellat-Parast, and Jones,
(2019)

Impact of Risk Management on Project Performance 30
Balance scorecard It is a strategic management
performance metric that is
used for purpose of
identifying and enhancing
internal business operations
in addition to their resulting
outcomes.
Syahdan, Munawaroh, and
Akbar (2018)
Key performance indicator It is a measurable value used
to demonstrate the
effectiveness of a company
towards attaining the
business key objectives.
Peral, Maté, and Marco
(2017)
Table 1: Performance Measurement Models
Situational Leadership Effectiveness
According research done by the Harvard Business School each business requires leadership
since leadership is one strategy through which leaders influence the behaviour of individuals
within the organisation. According to Lynch (2015) most of the successful businesses have
attained success because of successful leaders. Successful leaders have the ability to get
individuals to work to realise the goals and objectives of the business. In this sense, being
democratic or autocratic is often how leadership is believed by many people (Zigarmi, and
Roberts, 2017). For instance, autocratic leaders rely on their authority as well as power which
comes from them being owners of the business or occupying a senior position. On the other
hand, democratic leaders rely on personal power, decision-making and participative approach
to solve a problem. However, being democratic or autocratic only restricts a person’s
effectiveness as a leader. The alternative of being a democratic or autocratic leaders is being a

Impact of Risk Management on Project Performance 31
situational leader (Lacey, 2019). Situation leaders have the ability to adapt their styles of
leadership to suite that of their followers as well as the situation through which they are
working. Certainly situational leadership style allows leaders to different ways when it comes
to leading employees within an organisation.
Leaders who use situational leadership will make conscious options between their usage of
directive behaviour as well as supportive behaviour. For the directive approach, a leader
depends on providing control, framework in addition to close supervision for the individuals
with whom they are working (Fernandez, 2017, p.35). In regard to the supportive approach,
leaders will depend on praise as well as two-way communication to facilitate the work of
their employees and co-workers. Successful leaders have the capability to view at situations
through a range of perspectives. Such leaders evaluate the situations as well as behaviour of
their teams in play and there after determine the type of leadership style to utilise to attain the
best outcome (Bosse, Duell, Memon, Treur, and Van der Wal, 2017, p.607).
Benefits of Situational Leadership
It is a more flexible leadership approach: Situational leadership is a relationship driven type
of leadership, which bases the leader’s directives on ability as well as readiness of their
followers (Lynch, McCance, McCormack, and Brown, 2018). Certainly, this is the reason as
to why it is referred to as a “flexible approach”. In this case, a leader does not utilise one style
of leadership across all their team members (Walls, 2019, p.31). For this type of leadership to
work effectively, the leader is supposed to develop a relation with their teams so as to
understand their state of mind when it comes to receiving directions on tasks that they need to
accomplish (Daniëls, Hondeghem, and Dochy, 2019). Accordingly, this type of leadership is
mostly used on new workers since they are still new at learning their tasks. On the other

Impact of Risk Management on Project Performance 32
hand, a leader could as well delegate the responsibility of training to the highly motivated and
tenured team member (Gaikwad, 2019, p.125).
It enhances successful collaboration amongst team members: When a leader makes use of
situational leadership style it become easier to enhance interaction amongst team members
(Walls, 2019, p.33). In addition to that, advancements in technology has made collaboration
even further easier among employees even across different continents. Research reveals that
more than 70% of employees relate through collaboration. Buba, and Tanko (2017) suggest
that lack of collaboration among employees leads to failure in the place of work. Certainly,
the existence of collaboration among employees improves team productivity as well as
involvement. Successful leaders make use of situational leadership style to influence team
members so as to attain maximum strength of the workforce (Lynch, McCance, McCormack,
and Brown, 2018, p.431). Indeed, when team members are optimised, collaboration becomes
a path towards creative collaboration which results into innovations that are benefit to any
organisation. In this sense, situational leadership work to ensure that all employees are on
the same page. This leadership style eliminates redundancy among employees. For instance,
daily meetings with employee help in pointing out every member’s goals and tasks.
Through collaboration among employees it helps in setting clear expectations of
organisations goals. A leader who applies situational leadership stands a better chance to
communicate organisational goals to their teams which helps them to understand the way in
which tasks and objectives are linked to the entire organisation (Lynch, McCance,
McCormack, and Brown, 2018, p.430). The interaction with team members allows them to
help the manager in setting pace and at the same time give a forum to review performance at
the end of a project.

Impact of Risk Management on Project Performance 33
It encourages adaptability which fit the past, present as well future situations: Research has
shown that when a leader is adept of making use of transformational leadership, they are
regarded as situational leaders in terms of manging employees as well as dealing with
different circumstances in the place of work. Therefore, when such leaders are faced with a
challenge, the understand how to approach it by evaluating the effect that their solution could
bring (Buba, and Tanko, 2017). In this sense, situational leaders assess the history of the
problem, its current conditions causing the issue in addition to the plans on how to resolve the
problem and how it will affect the future of the business (Abdullahi et al., 2017). Situational
leadership is vital because it looks at the best strategies that could result in product
transformation and business processes to avoid experiencing a similar challenge in future
(Trevisol, Bencke, Padilha, and Roman, 2019). Accordingly, situational leadership is a
forward thinking approach which does not overlook the past as well as current circumstances.
Since business keeps on changing, organisational executives should always adapt and stay
abreast of all the chances that ensure business success (Gandolfi, and Stone, 2017, p.18).
It improves awareness of the present organisational situations: When businesses undergo
transformation such changes are unsettling hence employees become uncertain about their
positions within the organisation. As a result, most employees could fear that organisational
changes are likely to cost their jobs (Vito, 2020, p.3). However, irrespective of the changes
that an organisation is facing situational leadership style aids at easing any fears amongst
employees about the security of their jobs. Since situational leadership approach is employee-
oriented, it enables leaders to become concern about their team members (Gaikwad, 2019,
p125). Situational leadership allows leaders to exercise good communication skills which
provide employees with the right information that allows them to understand the vision as
well as goals of an organisation (Fischer, 2016, p.2645). Indeed, through leaders being
transparent with their employees it makes them to develop trust in their leaders which

Impact of Risk Management on Project Performance 34
consequently helps in transforming organisational visions. The ability of getting employees
buying to the aspirations of an organisation, the path towards its goals become quite fast,
smooth and more successful (Bosse, Duell, Memon, Treur, and Van der Wal, 2017, p.610).
Situational leadership encourages work productivity: According to Pasaribu (2015, p.70)
situational leadership is a together with their teams to unmask areas in the organisation as
well as process and products that require transformation in terms of improvement and
addition of extra value to become more competitive. Through identification of these factors,
situational leaders work with their teams in setting up project goals, schedule and work in
comprehensive plan to accomplish the vision of the organisation (Gaikwad, 2019, p.127). The
process of involving both leaders and employees in in establishing positive changes motivates
employees to get convinced as being a significant part of an organisation. As a result, this
aspect inspires employees to become more committed to their work and develop strong trust
in their leaders (Zigarmi, and Roberts, 2017). Certainly, this boost employee involvement in
the place of work which in turn impacts on the productivity of an organisation. When workers
receive the right support as well as feedback from their supervisors, it constantly reminds
them of their goals. Consequently, when workers veer away from the track, leaders are
supposed to be there to redirect them towards organisational set goals (Lacey, 2019). These
type of principles irrespective of the organisation’s team size, a situational leader will always
develop commitment to their workforce to become highly productive.
Situational leadership approach boost employees’ motivation within an organisation:
Recent studies has revealed that situational leadership style works well towards inspiring
workers with an organisation. Transformational leaders are known for empowering their
employees through delegating tasks and responsibilities by trusting them with responsibilities
as a strategy to develop their skills as well as giving them support to realise their gaols
(Lynch, McCance, McCormack, and Brown, 2018, p.437). As a result, this type of leadership

Impact of Risk Management on Project Performance 35
strongly keeps its employee motivated. Studies have shown that teams that are motivated
improves organisational performance in terms of productivity and lower risks (Imran, Ilyas,
and Aslam, 2016, p.234). Motivated workers are more creative hence they contribute more
ideas to the organisation (Walls, 2019, p.31). Basically, employees benefits from situational
leaders that know how to empower highly performing workers through delegation of tasks.
Through delegation of responsibilities, it allow leaders to pay more attention on those
employees that need more support (Trevisol, Bencke, Padilha, and Roman, 2019). At the end
of the day, organisations that utilise situational leaders receive the return on their investment.
Laissez-faire leadership effectiveness
“laissez-failure” is a French terms that is commonly used in the files of political science and
economics to describe a policy of minimum administrative interference in the economic
matters of the society and individuals. In the case of leadership studies, laissez-fare is a terms
that refers to “hands-off, let things-ride” strategy that is used to influence people in the place
of work. (Wong, and Giessner, 2018, p.757) defines laissez-faire leadership as the lack of
leadership as well avoidance of intervention. Leaders who are laissez-faire have a tendency of
behaving as if they have been abducted from their responsibilities as well as duties that are
assigned to them. This kind of leadership resembles an unplanned management as described
by Asrar-ul-Haq, and Kuchinke (2016) who refers to this type of leaders as exerting little
effort to achieve the required work performed. Leaders who exercise laissez-faire type of
leadership express minimal concern to their subordinates. Zareen, Razzaq, and Mujtaba
(2015, p.533) argue that while laissez-faire leaders have been designated to leadership
positions as well as physically occupied, these positions tend to ignore the duties in addition
to responsibilities dispensed to them. In regard to this, laissez-faire leadership is regarded as
“lack of presence” or “zero leadership” (Breevaart, and Zacher, 2019, p.385). Many
researchers have regarded laissez-faire as a leadership style that is destructive arguing that it

Impact of Risk Management on Project Performance 36
violates the lawful interests of businesses as well as their workforces by undermining the
objectives and goals of organisations. In addition to that, Nielsen, Skogstad, Gjerstad, and
Einarsen (2019, p.138) assert laissez-faire leadership as a leadership style that is not effective
compared to proactive and corrective leadership which monitors and focus on mistakes. This
kind of leadership is not effective because it waits until things have gone astray before
intervening, hence this type of leadership can be dangerous in regard to risks management in
a project (Sudha, Shahnawaz, and Farhat, 2016, p.115).
Review of Strategic Leadership Related models and Theories
7 Habits of highly effective people
The seven habits framework for personal effectiveness was advanced by Stephen R. Covey
when he was working on his doctorate in the 1970s. Covey reviewed literature that dated
back approximately 200 years in regard to success. During his review, Covey noted that as
early as 1920s, the success of writing has been based on solutions to specific problems and in
this some of the cases technical advice has been effective but this has only been for short
terms issues (Handel, 2016, p.171). For instance, approximately half of the twentieth century
literature has majorly based on the success of personality traits, how to maintain positive
attitude, techniques and skills among others (Hultman, and Neumeister, 2017, p.944). As a
result, this philosophy is referred to as Personal Ethic.
On the other hand, in approximately 150 years in the past, the literature on success has been
more character oriented. This literature was concerned with deeper principles as well as
foundations of success. This philosophy is referred to as the Character Ethic, through which
success if based more on the underlying characteristics such as justice, integrity, patience and
courage (Worrall, 2019, p.440). The features of the Character Ethic are primary aspects
whereas Personality ethic are secondary traits. Even though secondary traits play a key role in

Impact of Risk Management on Project Performance 37
aiding leaders to succeed in certain circumstances particularly short issues, for success that is
long term both Character ethic and Personality Ethic are highly important (Hughes, 2017,
p.25). With regard to the Character Ethic it assumes all human beings have some absolute
principles such as honesty, human dignity, fairness, growth, potential, quality and integrity.
However, principles differ with practices such that practices are for particular situations while
principles have universal applications.
The seven habits of highly effective people illustrates an “inside-out” approach in regard to
effectiveness which is based on character and principles. The meaning of inside-out is that
change begins within an individual’s self. Character is a collection of individual’s traits and
this habits play a key role in their lives. In this regard, habits consists of skills, knowledge as
well as desire. Skills provides people with the capability to understand how to do something;
on the other hand, knowledge enables people to know what to do and lastly but not least the
desire is what motivate people to do certain things.
The seven habits are subdivide in to the following stages: dependence, interdependence and
interdependence. Independence is a paradigm which people are born and depend on other
people to provide them with care. Independence is a paradigm where people are in a position
to make their decisions as well as take care of their selves. Interdependence is a paradigm
where individuals cooperate to attain certain things which cannot be attained independently.
Research has shown that most of the recent studies in the present world tend to value
independence where they encourage individuals to become liberated and perform things on
their own (Hultman, and Neumeister, 2017, p.947). Nonetheless, the truth of the matter is that
people are interdependent. However, before making the decision of become interdependent
one should be dependent because individuals who are dependent have not yet developed the
character for interdependence. As a result, the first three habits emphasise on self-mastery

Impact of Risk Management on Project Performance 38
which in other words is independence. The first three habits of highly effective individuals
include being proactive, beginning with the end in mind and putting first things first.
The fourth, fifth and six habits address interdependence. These habits include think win/win,
seek first to understand, then to be understood and synergize. Lastly but not least, the seventh
habit is of continued improvement, which in other words means building an individual’s
personal production ability. Therefore, for a leader to become effective, one should look for a
proper balance between real-time production and improving their capacity to produce.
Transformational leadership theory
Research has shown that business organisations always thrive in a setting that is characterised
by unpredictability as well as uncertainty because of constant, social, technological, and
economic in addition to political changes (Anderson, and Sun, 2017, p.78). As a result,
companies find themselves in dynamic situations that calls for continued adaptation. In such
settings, organisations needs an effective leadership to provide guidelines through such
changes which are likely to be challenging for a business. In this sense, companies are
required to transform their practices so as to maintain their success as well as survive.
Certainly, organisation require more than merely incremental modifications to their strategy.
Accordingly, organisation require a crucial transformation so that to reinvent themselves
(Turnnidge, and Côté, 2018, p.330). In this regard, firms should revamp their organisational
culture to impact the necessary changes. In this sense, transformational leadership is
concerned with renovating organisations as well as transforming the organisation by
following a vision that could result in evolution of the company’s culture.
Transformational leadership is defined as a leadership style where interaction amongst
interested parties is organised around a collective purpose in a manner that it transform,
improves and motivates activities and ethical aspirations (Berkovich, 2016, p.609).

Impact of Risk Management on Project Performance 39
Therefore, transformational leadership is a style of leadership which intends to create positive
transformations for its followers to attain desired changes based on the structure and strategy
undertaken by an organisation.
Alvesson, and Kärreman (2016, p.140) argue that transformational leadership is characterised
by a number of behavioural patterns. To begin with, transformational leadership utilises the
charisma of leaders so as to attain the trust as well as respect of organisational stakeholders.
Additionally, charisma highlights the provision of a common vision as well as a sense of
mission that is essential for the transformation. Secondly, transformational leadership is
inspirational where leaders make use of symbols to redirect employee’s efforts, which are
expressed in a simple manner (Fischer, 2016, p.2644). The essence of transformational
leadership process is to clearly communicate the organisation’s expectations. Thirdly,
transformational leadership is characterised by intellectual stimulation. Transformational
leaders intellectually stimulate the workforce by stressing on creativity and rationality when it
comes to problem solving circumstances. Lastly but not least, transformational leadership
provides individualised considerations. Therefore, this type of leaders treat workers
individually by providing them with personal attention and if need be they provide them with
advice and coaching.
Anderson, and Sun (2017, p.81) suggest that transformational leadership can be focussed on
group levels as well as individual levels. The aim of transformational leadership is to
empower employees to develop their full potential to improve their skills and capability. The
influence played by transformational leaders is to strengthen the interest of their followers.
Transformational leaders strive to understand workers the skills, needs and capabilities by
providing them with mentoring and coaching to overcome any problems. At group level
transformational leadership develops a common value as well as beliefs by inspiring unity
with the aim to realise organisational goals. In this context, leaders act equally toward all

Impact of Risk Management on Project Performance 40
persons within an organisation and later they end up having a common stand regarding the
leader’s behaviour.
4Vs of Ethical Leadership Model
Ethical leadership is a model that reiterates on the relevance of ethics in regards to decision-
making. Ethical leadership is a leadership type where individuals exhibit conduct for the
common good that is appropriate as well as acceptable in each aspect of life. Therefore
ethical leadership consist of three key aspects: being an example, championing the relevance
of ethics and communication (Lee, Cho, Baek, Pillai, and Oh, 2019, p.824). The most
outstanding leadership quality is leading by example. An ethical leaders should lead by
actions since it is believed that people are judged more by the way in which they act rather
that their words. Consequently, exhibiting and practising ethically by upholding honest and
selflessness to subordinates earns a leader respect and trust from their juniors and peers.
Studies have shown that people always follow leaders who have respect for others and
demonstrate integrity (Hansen, Dunford, Alge, and Jackson, 2016, p. 650).
The role of an ethical leader is to pay attention on the general significance of ethics which
include ethical principles as well as ethical matters as well as the manner in which these
aspects influence the surrounding. Kalshoven, Van Dijk, and Boon (2016, p.501) argue that
an ethical leader has the responsibility to teach their subordinates about ethics particularly in
situation where they are faced with ethical matters in the place of work.
According to Walumbwa, Hartnell, and Misati (2017) leaders who are successful in terms of
ethics most often tend to be good communicators. A number of individuals may find it
comfortable talking in public irrespective of the situation or person. On the other hand, others
could be reluctant of talking with a leader due to fear or because they just do not know the
manner in which to articulate their views. Nonetheless, it is the responsibility of an ethical

Impact of Risk Management on Project Performance 41
leader to communicate with every team member as well as allowing for an open discussion
since some individuals could be having concerns and questions which ought to be addressed
(Cho, Lee, Baek, Pillai, and Oh, 2018). Therefore, it is essential for an ethical leader to
establish a friendship with their team member since quality relations are based on fairness,
trust, openness, integrity, respect as well as companionship.
Ethical leaders play a vital role within an organisation in the sense that they help in
developing a positive setting with productive correlations over three stages: general
organisation, individual and team level. Through nurturing of relationships at every stage has
various benefits attached to it.
Summary of theories and models
Theory/model Assumption Strength Weakness Source
Transformational
leadership theory
Transformationa
l leadership
happens when
leaders are able
to perform their
role in an
effective manner
that leads to such
leaders gaining
respect, trust,
loyalty and
appreciation
from their
subordinates.
It helps to
create and
manage change.
In order for
organisation to
grow they have
to be willing to
accept change.
Therefore, a
transformational
leader has the
capability to sell
their benefits
and the morality
People can lose
power if
individuals
around them
disagree with
their concepts.
If employees
fails to agree
with the vision
of their leaders
they are likely
to lose their
power.
Turnnidge,
and Côté,
(2018)

Impact of Risk Management on Project Performance 42
of change
through creating
an inspirational
vision and
influencing
people around
them to follow.
Ethical
leadership model
Ethical leaders
play a vital role
within an
organisation in
the sense that
they help in
developing a
positive setting
with productive
correlations over
three stages:
general
organisation,
individual and
team level.
Ethical
leaderships has
various
strengths such
as it make sure
that
organisations
and their
employees work
according to the
law and creates
a healthier
workplace
organisational
culture.
It calls for
comprehensive
support to be
effective and it
is also an
expensive
leadership style
to be
implemented by
organisation.
Cho, Lee,
Baek, Pillai,
and Oh (2018)
Table 2: Summary of models and theories
Benefits of ethical leadership within an organisation

Impact of Risk Management on Project Performance 43
Boost individual well-being: Ethical leaders maintain a positive work environment which is a
significant responsibility of a powerful ethical leader. Recent studies have found that ethical
leaders who lead by example have high chances of influencing others towards doing the
same. In general, individuals who get affected by this interactions which happens around
them positively communicate this influence to their peers thus aid in impacting on work
productiveness.
Improves the energy of the group: Ethical leaders could also engage the management towards
conducting collaboration amongst teams. Ultimately, when people are getting along with one
another it boost their morale in the place of work. Therefore, through co-workers working
together as teams, it plays a key role in establishing relationships in the place of work hence
improves the general performance of the team (Walumbwa, Hartnell, and Misati, 2017, p.15).
Establish a healthy organisation: Studies have found that the essence of upholding a positive
attitude in the place of work has much to do with boosting the entire health of the enterprise.
When individuals show respect for each other and see the value of others views, it nurtures a
productive work setting. As a result, an ethical organisation happens when people from
dissimilar walks of life are capable of working together through mutual respect as well as
where they can grow their personality, establish friendship and contributes to the general
organisational goals (Chang, 2018).
Basically, the 4V model of ethical leadership plays a vital role towards aligning the internal
beliefs as well as values with the outside behaviours in addition to actions for the purpose of
attaining a common good (Lin, Ma, and Johnson, 2016, p.815). The 4Vs include virtue,
voice, vision and values. These characteristics greatly helps in establishing ethical leaders
whose aim is to create an environment that is inclusive, positive and permits the potential of

Impact of Risk Management on Project Performance 44
people to pursue as well as accomplish their needs and attain the highest potential (Freeman,
2016, p95).
2.3 Review of Relevant Empirical Research
Empirical Studies in Malaysia
There are very few empirical studies that have been carried with respect to the subject under
study by Malaysian organisations. Therefore, this part will research on various relevant
empirical studies in Malaysia and internationally.
Enterprise Risk Management Practices among Malaysian Companies
Enterprise Risk Management (ERM) has become a critical concern amongst all industries.
Indeed, ERM is a holistic method used by managers to identify as well as chose the most
suitable responses which align with the enterprise’s risk appetite. According to recent studies
is shows that in the past two to three decades ago risk management was not viewed as a
crucial as well as strategic management discipline (Waseem-Ul-Hameed, Ali, and Arif,
2017). Risk management was primarily influenced by the perception of managers about risk
(Soltanizadeh et al., 2014, p.332). In the recent past risk management has gradually started to
become a necessity concern hence the capability to identify risks as well as adapt to the ever-
transforming business setting have become vital aspects of success for all enterprises. As a
result, managerial discretion in terms of identifying risks as well as response to risks has
resulted into a number of methods used to manage risks like political risks management,
insurance and financial risk management (Maruhun, Abdullah, Atan, and Yusuf, 2018,
p.866). However, while none of these methods were wrong, but their way of addressing risks
was restricted and fragmented (Razali, and Tahir, 2011, p.204). In this sense, there has been
need for effective ways of identifying and responding to different risks that have led to
adopting comprehensive risks management programs by most companies.

Impact of Risk Management on Project Performance 45
According to Yazid, Hussin, and Daud (2011, p.94) enterprise risk management is one of the
methods which goes beyond silo-based understanding of risk. Enterprise risk management is
a holistic method for identifying probable risks that an organisation is likely to experience
and choosing the most suitable responses which matches with the appetite of the enterprise
risks. Through application of enterprise risk management it increases risk awareness in a
company as well as improving the decision making capability which results to organisation
value maximization. Nonetheless, irrespective of the numerous benefits associated with
enterprise risk management, most organisation in Malaysia are yet to adopt this approach
(Lai, 2012).
ERM and Its Significance to Corporate Malaysia
Malaysia operates in an open market economy whose total volume amounts to approximately
double its yearly growth domestic product (GDP). In this sense, it shows that firms operating
in Malaysia are exposed as well as susceptible to a number of shocks, externally and
internally in terms of political, economic, cultural, technologically and natural disaster.
Studies have indicated that the Malaysian PLCs are not oblivious to the novel and pinpointed
challenges facing them in the present business setting as well as landscape of operation
(Daud, Yazid, and Hussin, 2010). Most PLCs are continuously seeking for novel enterprise
risk management model to address the extra risks which are either inadequately or not dully
addressed by the conventional corporate risks management mechanism. For instance, certain
risks cannot be transferred to counter parties through engaging in derivative contracts.
Certainly, ignoring these risks while having a full understanding of their existence do not
seem to conform to the appropriate managerial practice whose focus is accountability as well
as fiduciary responsibility (Waseem-Ul-Hameed, Ali, and Arif, 2017). With regard to this,
many PLCs are experiencing pressure in seeking solution to address these risk factors by

Impact of Risk Management on Project Performance 46
operationalising factors that are considered essential processes to counter these risks (Roslan,
and Dahan, 2013). Nonetheless, because of novelty in the concept in addition to absence of
standard procedures of enterprise risk management execution, most PLCs in Malaysia are
unaware of the real implementation of ERM programs.
Quantifying Transaction risk in organisation’s yearly reports: With regard to the numerous
risks facing PLCs operation in Malaysia, the repercussion could probably bring down the
investment return to shareholders. As a result, Malaysian regulators such as Securities
Commission as well as Bursa Malaysia are compelling public listed corporations to quantify
their transactional risk exposure in their organisation’s yearly reports (Mohd-Sanusi et al.,
2017, p.7). Accordingly, this is an example of Malaysian regulation interest to protect the
interest of investors in the public by controlling accounting standards (Waseem-Ul-Hameed,
Ali, and Arif, 2017). Nevertheless, based on the macro perspective of the Malaysian
regulatory framework, there is no particular laws that impose the need for a rigorous
enterprise risk management plan to be implemented by the Public Listed Companies (PLCs).
The most appropriate point of reference asking the Malaysian regulatory framework to
manage risks is based within the Malaysian Code on Corporate Governance.
The Malaysian Code on Corporate Governance: The Malaysian Code on Corporate
Governance (Code) was first introduced in 2000. This Code unifies the principles as well as
appropriate governance to describe optimal corporate practices structures as well as internal
processes (Maruhun, Abdullah, Atan, and Yusuf, 2018). Based on the perspective of
enterprise risks management, the Malaysian Code is asking public listed companies to
institute a formal risk management plan to control their business risks (Razali, and Tahir,
2011). This code comprises a compulsory reporting of the PLCs corporate risk management
framework in their yearly report. Therefore, the Malaysian Code outline extensive standards
as well as best practices of suitable corporate governance for Malaysian companies. Some of

Impact of Risk Management on Project Performance 47
the things that companies are required by the Listing Requirements of Bursa Malaysia
consists their yearly report, narrative reports regarding the way in which companies apply the
significant corporate governance principles in their specific situations (Aziz, Manab, and
Othman, 2016, p.4). Certainly, this is done to make sure that investors have enough
disclosure through the listed firms for evaluation of companies’ performance as well as
practices of governance.
Empirical studies across the globe
Risk management is a coordinated practise which directs and regulates organisation in regard
to risks. In the case of the Australian Council it believes that risk happens at all levels of
organisations operations as well as at each phase of the operations lifecycle (Qazi, Quigley,
Dickson, and Kirytopoulos, 2016, p.1184). Accordingly, risk is viewed as a threat as well as
an opportunity hence it is management effectively (Carvalho, and Rabechini Jr, 2017,
p.1122). According to Fraser, and Simkins, (2016, p.690) risk management entails
developing an appropriate risk management culture and infrastructure by applying systematic
and logical risk management procedures at all levels in any activity or operation lifecycle.
Accordingly, this has enabled the Australian Council to minimise losses and maximise
performance. The obligation of the Australian Council in regard to risk management is
performed by the public Governance, Performance and Accountability Act (PGPAA).
Consequently, many organisations across Australia are flourishing because they have put in
place appropriate risk management strategies (Grace, Leverty, Phillips, and Shimpi, 2015,
p.293).
In a survey performed by Bromiley, McShane, Nair, and Rustambekov, (2015) it shows that
more than 70% of organisations does not have a comprehensive enterprise risk management
process in place. For instance, a survey by more than 400 United States senior finance leaders

Impact of Risk Management on Project Performance 48
and CFOs stated that most organisations across the United States use of enterprise risk
management are still relatively not mature (Sirisomboonsuk, Gu, Cao, and Burns, 2018, 299).
Less than 25% of the financial leaders suggested that the overall maturity in terms of risk
management was termed as mature (Ahmed, and Anantatmula, 2017). Nonetheless, there is
evidence that adoption of enterprise risk management is scaling up among most United States
organisations (Nyamah, Jiang, Feng, and Enchill, 2017). For the past one decade since the
North Carolina States University’s Enterprise Risk Management initiative as well as the
American Institute of CPAs (AICPA) started yearly research, reports indicate that has been
approximately more than 20% organisations that have adopted complete enterprise risk
management practices in their operations (Farrell, and Gallagher, 2015, p.625).
Risk management and project performance
Risk management plays a key role to the success of an organisation. Without risk
management organisations cannot define their objectives as well as future. Research has
shown that if a business formulate its goals and objectives without considering risks in its
operations, there are higher chances that such a business could lose its direction once it is hit
by any risks (Smith, and Bititci, 2017, p.1210). Many companies in the recent past have
included risk management in their operations in order to ensure that they keep their
performance at the top. Therefore, risk management is directly proportional to an
organisation’s performance.
Risk management and leadership effectiveness
Top leadership plays a major role in making sure the success of quality risk management
within an organisation. Therefore, effective leaders strongly invest in and are accountable for
risk management plan in an organisation. The objective of an effective leader is actively
managing risks by preventing risk and not correcting risk situations (Ali, Norman, Ghani, and

Impact of Risk Management on Project Performance 49
Haron, 2019, p.70). Effective leadership in terms of risk management empowers the
organisation to develop a quality risk management structure which consist of risk assessment,
risk communication, risk control, risk management and risk management tools. Certainly, this
impact the way in which risk is managed, hence quality risk management is based on
appropriate risk management practices applied by the project leader.
Leadership effectiveness and project performance
The success of any project is considered in terms of employee commitment, employee job
satisfaction and organisational performance. According to argue that leaders motivate and aid
their employees to be competitive through effective leadership styles. As a result, leaders
make use of effective leadership styles to professional develop employees of organisations.
Effective leadership entails management, motivation, remuneration, inspiration and skills
analysis. Research has shown that when effective leadership factors are applied within an
organisation it boost the satisfaction of employees which positively contributes to
productivity (Pretorius, Steyn, and Bond-Barnard, 2017, p.101). In order to increase
organisational performance, a leader should possess the capability to promote innovation and
creativity to stimulate subordinates to challenge them to improve their performance.
2.4 Literature Gap
The PLCs of Malaysia have been affected by the absence of a solid standards procedures of
enterprise risk management. For instance, studies have found that most organisation in
Malaysia have not been considering risk management as a critical strategic management
principle (Razali, and Tahir, 2011, p.204). Indeed, most of the organisations in Malaysia have
been found to lack risk management methods to address risks or if they have these methods
they have not been used in the right way. On the same note lack of laws that govern the

Impact of Risk Management on Project Performance 50
Malaysian PLCs is the primary challenges that is facing Malaysian organisation. Most of the
studies that have been carried have majorly based on the general enterprise risk management.
2.5 Summary of past studies
Based on the theoretical review, various concepts have been described such as risk
management, leadership effectiveness, and project performance. All these concepts describe
the relationship between risk management and leadership effectiveness and how they impact
organisational performance. According to aforementioned studies, risk management has been
found to be a significant aspect in relation to organisational performance since it helps
businesses in regards to how they run their operations. According to the empirical review it
indicate that risk management risk management is still at its infancy among public listed
companies in Malaysia. For instance, Roslan and Dahan (2013) argue that Malaysian PLCs
are being faced by pressure of numerous risks. Malaysian companies are faced by numerous
risks because of lack of laws that guide and regulate enterprise risks management process.
With regard to the numerous risks facing Malaysian PLCs much research need to be
undertaken to address the impact associated with risk management amongst Malaysian
companies.
Title Variables Context Source
Transformational
leadership in
nursing
 Transformational
leadership
 Interactive
leadership
 Instrumental
leadership
Nursing services,
Australia
Fischer (2016)
Applying
transformational
Transformational Sports, United Turnnidge, and

Impact of Risk Management on Project Performance 51
leadership theory to
coaching research in
youth sport
leadership theory States Côté (2018)
The influence of
risk management on
construction project
performance
 Risk
management
 Construction
project
performance
Construction
industry, Malaysia
Ali, Norman,
Ghani, and Haron
(2019)
The evaluation of
risk management in
public sector capital
projects
 Risk evaluation
 Risk
management
Public sector
project, Australia
Baldry (2018)
Predicting the
impact of multiple
risks on project
performance
 Project risks
 Project
performance
Construction
industry, Australia
Bañuls, López,
Turoff, and
Tejedor (2017)
Leadership styles
and organizational
commitment
 Leadership
styles
 Organisational
commitment
SME, Australia Yahaya, and
Ebrahim (2016)
Effects of
transformational
and shared
leadership styles on
employees'
Transformational
leadership
Effects of
transformational
leadership styles
Malaysia Choi, Kim, and
Kang (2017)

Impact of Risk Management on Project Performance 52
perception of team
effectiveness
Impact of leadership
styles on
employees’ attitude
towards their leader
and performance
 Impact of
leadership style
 Employees’
attitude
Relationship
between
leadership style
and performance
Pakistani banks Asrar-ul-Haq, and
Kuchinke (2016)
Enterprise Risk
Management
Implementation and
Firm Performance
 Enterprise risk
management
implementation
 Enterprise risk
management and
performance
Malaysian Oil and
Gas Industry
Shad, and Lai
(2019)
Knowledge-based
risk management
framework for
information
technology project
 Risk
management
 Information
technology
Information
technology, India
Alhawari,
Karadsheh, Talet,
and Mansour
(2012)
Analysis of Swedish
forest owners’
 Climate change
 Information and
Sweden André, Baird,
Swartling,

Impact of Risk Management on Project Performance 53
information and
knowledge-sharing
networks for
decision-making:
insights for climate
change
communication and
adaptation
knowledge-
sharing networks
Vulturius, and
Plummer (2017)
Table 3: Summary of past studies

Impact of Risk Management on Project Performance 54
2.6 Conceptual framework
Conceptual framework of the relationship between risk management and leadership
effectiveness on project performance
2.7 Hypothesis
H1: Risk management has a significant positive impact on project performance
H2: Risk management has a significant positive impact on leadership effectiveness
H3: Leadership effectiveness has a significant positive impact on project performance
H4: Impact of risk management on project performance is mediated by leadership
effectiveness
Leadership
effectiveness
Risk
management
Project
performance

Impact of Risk Management on Project Performance 55
Chapter 3
3.0 Research Methodology
Methodology is a systematic and theoretical analysis of the methods used in a research study
(Fletcher, 2017, p.182). In this sense, methodology does not set out to provide solutions, but
it provides a theoretical underpinning to comprehend the type of method or best approaches
which can be applied on a particular research topic. Generally, methodology is a research
approach which outlines the way through which a study should be undertaken by identifying
methods used in the study. Certainly, these methods describes the modes of data collection in
a research. Therefore, methodology is among the key elements of any research paradigm
(Flick, 2015). A paradigm is a framework which gives a path to view how the world looks at
the scientific features in relations to the research assumptions. The primary target of this part
is to describe the methods as well as techniques applied by the investigator to structure this
study in order to attain the objectives of the research. Consequently, this chapter talks about
the research paradigm, research design/methods utilised in the collection of data, research
strategy, data instruments, ethical considerations and data analysis plan used to generate
results out of the collected data.
Research Paradigm
Research paradigm is defined as a logical and methodological approach used to investigate
and acknowledge a research issues in attempt to come up with a way of solving a specific
research problem under research (National Academies of Sciences, Engineering, and
Medicine, 2018). In this case the issue under investigation is to investigate the impact of risk
management on project performance mediated by leadership effectiveness. This research
employed a positivism method as the most suitable choice because it has the ability to
investigate the relationship between individuals and society. The society is believed to shape
individuals because the society comprises “social facts” that exercise coercive control over

Impact of Risk Management on Project Performance 56
individuals (Kilubi, 2016). In generally, actions of individuals are explained through the use
of social norms which have thus been exposed through their socialisation. Positivism method
is appropriate because it investigates the relationship been leadership effectiveness and risks
management and their contribution to project performance (Lachmann, Trapp, and Trapp,
2017). Positivist prefer scientific quantitative methods such as structured questionnaires and
social surveys since they have good representativeness and reliability (Antwi, and Hamza,
2015, p.220). The tradition of positivist focusses on the significance of undertaking
quantitative research such as that involving large scale surveys with the intend to find an
overview of the society as a whole to uncover social trends such as the relationship between
risk management and project performance and leadership effectiveness and project
performance (Prasad, 2017). Additionally, positivism approach is effective because it tends to
focus on relationships between two or more variables (Granlund, and Lukka, 2017).
Research Design/Method
Research design is a structure of methods as well as techniques which are selected by the
researcher where they combine different elements of research in a logical manner in order to
effectively handle the research problem (Abdulkadiroğlu, Angrist, Narita, and Pathak, 2017,
p1374). In this sense, research design is significant in research because it offers insight
regarding the way in which to undertake the research using particular methods. The research
design used in this study is a survey. Survey research design is a process in quantitative
research where the researcher administers a survey to a sample population to find out their
views, and attitudes towards the topic under investigation (Turner, Cardinal, and Burton,
2017, p.245). The investigator used survey research because it allowed them to collect a large
volume of data that was later on analysed to determine the frequencies, patterns and averages
(Leavy, 2017). This allowed the researcher to determine the correlation between risk
management and project performance. The researchers applied a descriptive research design

Impact of Risk Management on Project Performance 57
to describe as well as explain the study topic to its related aspects (Rahi, 2017, p.4). The
researcher used a descriptive research so that to be able to describe the characteristics of the
respondents regarding the study topic. The aim of this study is to discuss the impact of risk
management on project performance and how it is mediated by leadership effectiveness.
Moreover, in order to describe this study in depth, a quantitative research approach was used.
This study approach is utilised to establish a better understanding of how risk management is
related to leadership effectiveness and how its impacts the performance of an organisation or
project.
Research Strategy
Arora et al. (2016, p.5) define research strategy as a process or way in which an investigator
makes sense of the research topic under investigation. Research strategy provides a general
guideline in regard the manner in which the researcher is performed. The research strategy
assumes a general plan through which the researcher will follow in answering the research
questions (Thorpe, Higgins, and Otto, 2019, p.10). In this case, the researcher strategy that
will be used in a quantitative research, which is a logical empirical study that use
mathematical and statistical techniques to analyse collected data (Brannen, 2017). In regard
to this study, the researcher utilised a survey questionnaire research strategy to collect data to
answering the research questions. The researcher picked on survey because it is the most
appropriate strategy because it has been found appropriate for management and business
studies (Bryman, 2017, p.63). Accordingly, survey questionnaires allowed the researcher to
gather large amounts of data from a sizeable population target (Erbe et al, 2016, p.17). In
addition, the type of data collected through this strategy can be analysed by use of descriptive
as well as inferential analysis tools (Togia, and Malliari, 2017, p.46).

Impact of Risk Management on Project Performance 58
Data Collection Method
Data collection is a procedure of gathering information and data from all the relevant sources
in attempt to look for answers to a research problem, testing hypothesis and evaluating and
analysis findings (Goertzen, 2017, p.12). In regard to this research the researcher embraced a
primary data collection method, specifically quantitative data collection method. Quantitative
data collection approach is built on mathematical calculations in different methods (Bryman,
2017, p58). The quantitative data collection and analysis used in this research was
questionnaires which comprised cross-ended questions on the research topic (Abildgaard,
Saksvik, and Nielsen, 2016, p.1380). The methods of correlation included mean, regression
and standard deviation (Abildgaard, Saksvik, and Nielsen, 2016, p.1380). Also, quantitative
methods have a high level of standardisation which makes it easier to make comparison of
research findings.
Target population, sample size and sampling method
The target population for this research were organisation managers, and employees from
different organisations such as partnerships, sole proprietorship, private limited companies,
public limited companies and limited liability partnerships across Malaysia. This target
population consisted of both male and female participants. The sample size used for this
study was 40 participants. This respondents were selected through a random sampling
approach. Therefore, each respondent had equal chances of being selected to participate in
the research.
Title Population Sample
Limited companies 20 5
Private limited 10 3
Sole proprietorship 40 20
Partnership 8 2

Impact of Risk Management on Project Performance 59
Public limited companies 25 10
Table 4: Target population and sample size
Data Instruments
This is a critical step for any research. The researcher utilised a random sampling approach to
identify the respondents involved in the research. Random sampling technique was used in
this research because it is easier and more accurate representation (Rahi, 2017, p.5). Since the
organisation under investigation has a huge population random sampling technique was
found suitable because there is no need of dividing the huge population into sub-division.
Also, each member in the research population has equal chances of being selected
(Taherdoost, 2016). On the same note, the randomly selected subjects represents the larger
populace under investigation. The data instrument used to collect data is a survey question
title: Impact of Risk Management on Project Performance Mediated by Leadership
Effectiveness.
Questionnaire development
The questionnaire for the research consisted of respondent’s demographic information such
as gender, age group, income level, education level. The other part of the questionnaire was
developed based on three factors: risk management, project performance and leadership
effectiveness. The questionnaire used closed-ended questions. The questionnaire used a scale
1-5 whereby 1 was interpreted as “strongly disagree” up to 5 which was interpreted as
“strongly agree”.
Ethical and Accessibility
The researcher strictly restricted the study to the formal principles for quantitative research
process in formulating research questions, selection of research respondents, research design,

Impact of Risk Management on Project Performance 60
analysis as well as interpretation of data (Roberts, 2015, p.314). As a result, the researcher
observed honesty at the time of undertaking the research by being fair to all respondents.
Also, the research respondents were assured of their identity protection and those who
participated in the study were voluntarily requested to take part in the study. Moreover,
respondents were assured that their views could only be used for purposes of academics
hence the collected data could not be used for financial gains whatsoever.
Data Analysis Plan
The data was analysed using a statistics analysis software known as the Statistical Package
for Social sciences (SPSS). This tool provides more accurate results and has the ability to
determine a correlation between the study variables.

Impact of Risk Management on Project Performance 61
Chapter 4
4.0 Data Analysis
In this part, the researcher presents the results of the survey questionnaire which was
disseminated in the filed for research participants to fill in. The research participants for this
study were 236 comprising 126 males and 110 females. The first part of the survey questions
comprised demographic questions in which the investigator gathered general information of
the respondents about their gender, age group, income level, education level and the type of
business operations where they work. The results was illustrated using a frequency analysis
of the responses as shown in the table below.
4.1 Demographic Analysis
Gender
Frequency Percent
Valid
Percent
Cumulative
Percent
Valid Male 126 53.4 53.4 53.4
Female 110 46.6 46.6 100.0
Total 236 100.0 100.0
Table 5: Respondents gender frequency
The table above shows that the total number of respondents involved in the study were 40.
From these 236 respondents 126 were male representing 53.4% of the total population and
110 female respondents representing 46.6% of the entire populace.

Impact of Risk Management on Project Performance 62
Figure 1: Respondents gender distribution
Based on figure 1 above it shows that the number of male respondents was greater than that
of female by a slight portion.
Age_group
Frequency Percent
Valid
Percent
Cumulative
Percent
Valid 18-25 20 8.5 8.5 8.5
26-35 47 19.9 19.9 28.4
36-45 85 36.0 36.0 64.4
46-55 59 25.0 25.0 89.4

Impact of Risk Management on Project Performance 63
55 and
above
25 10.6 10.6 100.0
Total 236 100.0 100.0
Table 6: Respondents age-group frequency
The table shows various age groups of respondents. The age of the respondent’s range
between 18 years and above 55 years. The number of respondents in the age-group of 18-25
years were 20 (8.5%), those in age group 26-35 years were 47 (19.9%). Those in age-group
36-45 years were 85 (36%) of the total population. Respondents in the age group of 46-55
years were 59 (25%) of the total population and those of age group above 55 years were 25
(10.6%) of the total population.

Impact of Risk Management on Project Performance 64
Figure 2: Respondent's age-group distribution
In regard to figure above, it shows that age group with the highest number of respondents
were those with 36-45 years, followed by those with 46-55 years, and the age group with the
least number of respondents was that of 18-25 years.
Income
Frequency Percent
Valid
Percent
Cumulative
Percent
Valid 1200-3000 33 14.0 14.0 14.0
3001-5000 68 28.8 28.8 42.8
5001-10000 93 39.4 39.4 82.2

Impact of Risk Management on Project Performance 65
10001 and
above
42 17.8 17.8 100.0
Total 236 100.0 100.0
Table 7: Respondents income frequency
The aforementioned table shows income earned by respondents. Those respondents with
income range of 1200-3000 were 33 (14%) of the entire population. Those with income of
3001-5000 were 68 (28.8%) of the total population. Respondents earning income of 5001-
10000 were 93 (39.4%) of the entire respondents and those earning above 10000 were 42
(17.8%) of the total population.

Impact of Risk Management on Project Performance 66
Figure 3: Respondents income distribution
The figure above shows that most of the respondent’s income range between 5001-10000
while those with the least number earn income is between 1200-3000.
Education_level
Frequency Percent
Valid
Percent
Cumulative
Percent
Valid Secondary 25 10.6 10.6 10.6
Diploma/
Degree
167 70.8 70.8 81.4
Masters 34 14.4 14.4 95.8

Impact of Risk Management on Project Performance 67
PhD 10 4.2 4.2 100.0
Total 236 100.0 100.0
Table 8: Respondent's education frequency
The table above shows the education level of respondents. In regard to the table above shows
that respondents with secondary education level were 25 (10.6%) of the total population.
Those with diploma/degree education level were 167 (70.8%) of the entire population. Those
respondents with master education level were 34 (14.4%) of the total population and
respondents who have attained education level of PhD were 10 (4.2%) of the total population.

Impact of Risk Management on Project Performance 68
Figure 4: Respondents education distribution
Based on the aforementioned figure above shows that most of the respondents have attained
education level of Diploma/Degree while respondents with the least number were those with
secondary and PhD education level followed by secondary and then master education level.
Tyoeof_business_organization
Frequency Percent
Valid
Percent
Cumulative
Percent
Valid Sole proprietorship 12 5.1 5.1 5.1
Partnership 13 5.5 5.5 10.6
Public limited
company
43 18.2 18.2 28.8
Private limited
company
147 62.3 62.3 91.1
Others 21 8.9 8.9 100.0
Total 236 100.0 100.0
Table 9: Respondents type of business operation frequency
With regard to the aforementioned table, it shows the business operations done by the
respondents to this study. The respondents are involved in various business operations such
as partnership, sole proprietor, private limited company, and public limited company. The
number of respondents who are in partnership business operations that were involved in the
study were 13 (5.5%) of the total population. Those who are sole proprietor business
operators were 12 (5.1%) of the entire study population, those involved in private limited
company business operations were 147 (62.3%). Those involved in public limited company

Impact of Risk Management on Project Performance 69
business operations were 43 (18.2%) of the total populace and those involved in others were
21 (8.9%).
Figure 5: Distribution of respondent's business operations
The figure above shows business operations undertaken by study respondents. From the
illustration it shows that private limited company had the leading number of respondents
followed by those in public limited companies while sole proprietor and partnership had the
least respondents respectively.

Impact of Risk Management on Project Performance 70
Risk Management
In my organisation risk management approach is used to identify potential impact to
enhance project performance
Riskmanagement_approachimpact_performance
Frequency Percent Valid Percent
Cumulative
Percent
Valid disagree 16 6.8 6.8 6.8
Neutral 51 21.6 21.6 28.4
Agree 92 39.0 39.0 67.4
Strongly agree 77 32.6 32.6 100.0
Total 236 100.0 100.0
Table 10: Risk management approach impact on performance
With regard to the above question, 16 (6.8%) respondents of the population disagreed that
risk management approach have impact on performance while 51 respondents (21.6%) of the
entire population were neutral. 169 respondents (71%) of the entire population agree and
strongly agreed that risk management approaches impact project performance.
People in my organisation considered risk management is important in managing the
project
Riskmanagement_importancefor_managingproject
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 13 5.5 5.5 5.9
Neutral 56 23.7 23.7 29.7
Agree 97 41.1 41.1 70.8
Strongly agree 69 29.2 29.2 100.0
Total 236 100.0 100.0

Impact of Risk Management on Project Performance 71
Table 11: Respondents opinion regarding importance of risk management in managing
projects
With regard to above survey question 1 (0.4%) respondent strongly disagreed and 13 (5.5%)
disagreed that risk management is not important in formulating project. 56 (23.7%) of
respondents were neutral. On the other hand, 166 respondents (70.3%) of the total population
agreed and strongly agreed that risk management is important in formulating projects.
In my organisation, people generally go through a formal/informal risk management
process.
Formal_informal_riskmanagement
Frequency Percent Valid Percent
Cumulative
Percent
Valid Disagree 18 7.6 7.6 7.6
Neutral 49 20.8 20.8 28.4
Agree 113 47.9 47.9 76.3
Strongly agree 56 23.7 23.7 100.0
Total 236 100.0 100.0
Table 12: Formal/informal risk management process
With regard to the above survey question, 18 respondents (7.6%) of the total population
disagreed that people do not go through formal or informal risk management process. 49
respondents (20.8%) of the entire population were neutral about the asked survey question.
169 respondents (71.6%) agreed and strongly agreed that people do go through formal as well
as informal risk management process.
In my organisation, risk management is seen as contributing factor in project
performance
Riskmanagement_importancefor_managingproject

Impact of Risk Management on Project Performance 72
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 13 5.5 5.5 5.9
Neutral 56 23.7 23.7 29.7
Agree 97 41.1 41.1 70.8
Strongly agree 69 29.2 29.2 100.0
Total 236 100.0 100.0
Table 13: How Risk management contribute to project performance
With regard to the above survey question 14 respondents (5.9%) of the study population
strongly disagree and disagreed that risk management does not contributes to project
performance. 56 respondents (23.7%) of the entire study were neutral on the asked survey
question. 166 respondents (70.3%) agreed and strongly agreed that risk management
contributes to project performance.
In my organisation, risk management is seen as influence behavarial in managing the
project
Riskmanagement_influenceproject_management_behavior
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 18 7.6 7.6 8.1
Neutral 63 26.7 26.7 34.7
Agree 96 40.7 40.7 75.4
Strongly agree 58 24.6 24.6 100.0
Total 236 100.0 100.0
Table 14: Risk management influence project on managing behaviour

Impact of Risk Management on Project Performance 73
19 respondents (8.1%) of the total population to the above asked survey question strongly
disagreed and disagreed that risk management does not influence project management
behaviour. 63 respondents (26.7%) of the entire population were neutral about the asked
survey question. 154 respondents (65.3%) of the population agreed and strongly agreed that
risk management influence project managing behaviour.
The experience/competence level plays an important part in the outcome of significant
risk management
Experiencerelevance_torisk_management
Frequency Percent Valid Percent
Cumulative
Percent
Valid Disagree 11 4.7 4.7 4.7
Neutral 35 14.8 14.8 19.5
Agree 91 38.6 38.6 58.1
Strongly agree 99 41.9 41.9 100.0
Total 236 100.0 100.0
Table 15: Role played by experience/competence levels to risk management
11 respondents (4.7%) disagreed that experience is not relevant to risk management. 35
respondents (14.8%) were neutral about the above survey question. 190 respondents (80.5%)
strongly agreed and agreed that experience is relevant to risk management.
Project Performance
In my organisation, generally all projects completed and meet the expectations.
Allprojects_meet_expectations
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 28 11.9 11.9 12.3
Neutral 59 25.0 25.0 37.3
Agree 114 48.3 48.3 85.6

Impact of Risk Management on Project Performance 74
Strongly agree 34 14.4 14.4 100.0
Total 236 100.0 100.0
Table 16: Respondents view about how completed project meets project expectations
29 respondents (12.3%) stated that all projects does not meet expectations. Similarly, 59
respondents (25%) On the other hand, 148 respondents (62.7%) of the total study population
agreed and strongly agreed that all project meet expectations.
In my organisation, KPIs has been established and implemented for all projects as part
of performance monitoring tool.
PKIas_performancecontrol_tool
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 5 2.1 2.1 2.5
Neutral 36 15.3 15.3 17.8
Agree 127 53.8 53.8 71.6
Strongly agree 67 28.4 28.4 100.0
Total 236 100.0 100.0
Table 17: Response regarding how KPIs act as a performance monitoring tool
26 respondents (2.5%) of the entire study populace stated that KPIs has not been established
and implemented for all project as part of performance monitoring tools. 36 respondents
(15.3%) of the whole study population was neutral about the survey question. 194
respondents (82.2%) of the whole research populace stated that KPIs has been established
and implemented in all project parts as part of performance monitoring tool.
In my organisation, project performance was reviewed from the beginning, progress till
completion by the organisation leadership.

Impact of Risk Management on Project Performance 75
Organisationalleadership_review_projectperformance
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 18 7.6 7.6 8.1
Neutral 48 20.3 20.3 28.4
Agree 116 49.2 49.2 77.5
Strongly agree 53 22.5 22.5 100.0
Total 236 100.0 100.0
Table 18: Response regarding how organisational leadership review influence project
performance
19 respondents to the asked survey question (8.1%) of the whole population strongly
disagreed and disagreed that organisational leadership does not review project performance.
48 respondents (20.3%) of the study population were neutral about the survey question. 169
respondents (71.7%) of the study population agreed and strongly agreed that organisational
leadership review project performance.
In my organisation, the potential risk in project the will be identified and addressed
accordingly
Potentialrisk_identifiedand_addressed
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 10 4.2 4.2 4.7
Neutral 59 25.0 25.0 29.7
Agree 114 48.3 48.3 78.0
Strongly agree 52 22.0 22.0 100.0
Total 236 100.0 100.0
Table 19: Response about how organisation identify potential risks and address them

Impact of Risk Management on Project Performance 76
Based on the above survey question, 11 respondents (4.7%) of the study population strongly
disagreed and disagreed that potential risk in project cannot be identified and addressed
accordingly. 59 respondents (25%) of the study population were neutral. 166 respondents
(70.3%) of the study population agreed and strongly agreed that organisational potential risk
in project can be identified and addressed accordingly.
In my organisation, all projects were delivered within the financial budget.
Relevant_experienceiskey_factorinproject_teams
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 27 11.4 11.4 11.9
Neutral 48 20.3 20.3 32.2
Agree 106 44.9 44.9 77.1
Strongly agree 54 22.9 22.9 100.0
Total 236 100.0 100.0
Table 20: Response regarding how all project are delivered within a financial budget
According to the above survey responses 28 respondents (11.9%) strongly disagreed and
disagreed that all project are not delivered within the financial budget. On the other hand, 48
respondents (20.3%) were neutral about the matter. 160 respondents (67.8%) of the study
population agreed and strongly agreed that all project were delivered within the financial
budget.
In my organisation, all projects completed with very minimal complaints
Projectscompleted_with_minimalcompliants
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 2 .8 .8 .8
Disagree 44 18.6 18.6 19.5
Neutral 46 19.5 19.5 39.0

Impact of Risk Management on Project Performance 77
Agree 116 49.2 49.2 88.1
Strongly agree 28 11.9 11.9 100.0
Total 236 100.0 100.0
Table 21: Respondents showing how all project are completed with very minimal complaints
Based on the above survey responses 46 respondents (19.5%) of the study population
strongly disagreed and disagreed that in their organisations all project are not completed with
minimal complaints. 46 respondents (19.5%) of the study population were neutral about the
asked survey question. 144 respondents (61.1%) of the study population agreed and strongly
agreed that in their organisations all project are completed with very minimal complaints.
In my organisation, the leadership team seriously look into the complaint as part of
future project improvement.
Leadershipteams_lookintocomplints_toimproveprojects
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 2 .8 .8 .8
Disagree 19 8.1 8.1 8.9
Neutral 46 19.5 19.5 28.4
Agree 119 50.4 50.4 78.8
Strongly agree 50 21.2 21.2 100.0
Total 236 100.0 100.0
Table 22: Response regarding how leadership teams seriously look into the complaints as
part of future project improvement
With regard to the above survey question 21 respondents (8.9%) of the entire study strongly
disagreed and disagreed that leadership teams does not seriously look into the complaints as
part of future project improvement. 46 respondents (19.5%) of the total research population
were neutral. 169 respondents (71.6%) of the whole study population agreed and strongly

Impact of Risk Management on Project Performance 78
agreed that leadership teams seriously look into the complaints as part of future project
improvement.
In my organisation, competency and relevance experiences are the key factors in project
team members.
Relevant_experienceiskey_factorinproject_teams
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 1 .4 .4 .4
Disagree 27 11.4 11.4 11.9
Neutral 48 20.3 20.3 32.2
Agree 106 44.9 44.9 77.1
Strongly agree 54 22.9 22.9 100.0
Total 236 100.0 100.0
Table 23: Competency and relevance experiences are key factors in project members
28 respondents (11.9%) of the study population strongly disagreed and disagreed that
organisational competence and relevance experiences are not key factors to project team
members. 48 respondents (20.3%) were neutral about the study survey. 160 respondents
(67.9%) of the study population agreed and strongly agreed that organisational competence
and relevance experiences are key factors in project team members.
In my organisation, the leadership motivate and provide clear directions and resources
required.
Leadershippromote_andprovide_directionand_necessaryresources
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 4 1.7 1.7 1.7
Disagree 24 10.2 10.2 11.9
Neutral 49 20.8 20.8 32.6
Agree 108 45.8 45.8 78.4

Impact of Risk Management on Project Performance 79
Strongly agree 51 21.6 21.6 100.0
Total 236 100.0 100.0
Table 24: Leadership team look into complaints to improve projects
28 respondents (11.9%) of the study population disagreed and strongly disagreed that in their
organisations the leadership does not motivate and provide clear directions and resources
required. 49 respondents (20.8%) were neutral about the survey question. 159 respondents
(67.4%) agreed and strongly agreed that their organisations leadership motivates and provide
clear directions and resource required.
Leadership Effectiveness
My leader talks about future trends that will influence how employee work gets done.
Leaders_talkabout_trendsthat_influence_comptence
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 2 .8 .8 .8
Disagree 20 8.5 8.5 9.3
Neutral 74 31.4 31.4 40.7
Agree 102 43.2 43.2 83.9
Strongly agree 38 16.1 16.1 100.0
Total 236 100.0 100.0
Table 25: Leaders talk about trends that influence how employees work
22 respondents (9.3%) of the study populace strongly disagreed and disagreed that leaders
does not talk about future trends that influence how employee work get done. 74 respondents
(31.4%) were neutral. 140 respondents (59.3%) of the study populace agreed and strongly
agreed that leaders talk about future trends that influence employee how work gets done.
My leader describes a convincing image of what employee future could be like.

Impact of Risk Management on Project Performance 80
Leaders_describeemployee_futureimage
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 3 1.3 1.3 1.3
Disagree 18 7.6 7.6 8.9
Neutral 83 35.2 35.2 44.1
Agree 93 39.4 39.4 83.5
Strongly agree 39 16.5 16.5 100.0
Total 236 100.0 100.0
Table 26: Leaders describe a convincing image of what employees would look like in future
With regard to the above survey question, 21 respondents (8.9%) of the study population
strongly disagreed and disagreed that their leaders do not describe convincing image of what
employee future could look like. 83 respondents (35.2%) were neutral about the survey
question. 132 respondents (55.9%) of the study population agreed and strongly agreed that
their leaders describe convincing image of what employee future could be like.
My leader speaks with honest principle about the higher meaning and purpose of
employee work.
Leadersspeak_withhonestabout_purposeofwork
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 3 1.3 1.3 1.3
Disagree 21 8.9 8.9 10.2
Neutral 76 32.2 32.2 42.4
Agree 90 38.1 38.1 80.5
Strongly agree 46 19.5 19.5 100.0
Total 236 100.0 100.0
Table 27: Leaders speak with honest principles regarding higher meaning and purpose of
employees

Impact of Risk Management on Project Performance 81
24 respondents (10.2%) strongly disagreed that their leaders speak with honest principle
about the higher meaning and purpose of employee work. 76 respondents (32.2%) were
neutral about the survey question. 136 respondents (57.6%) of the research population agreed
and strongly agreed that their leaders speak with honest principle about higher meaning of
employee work.
My leader seeks out challenging opportunities that test his/her own skills and abilities
Leadersseek_challenging_opportunitiestotest_theirabilities
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 2 .8 .8 .8
Disagree 17 7.2 7.2 8.1
Neutral 86 36.4 36.4 44.5
Agree 87 36.9 36.9 81.4
Strongly agree 44 18.6 18.6 100.0
Total 236 100.0 100.0
Table 28: Leaders seek challenging opportunities to test their abilities
Based on the above survey question, 19 respondents (8.1%) of the study population strongly
disagreed and disagree that their leaders does not seek out challenging opportunities that test
their skills and abilities. 86 respondents (36.4%) were neutral about the survey question. 131
respondents (55.5%) of the research group agreed and strongly agreed that their leaders seek
out challenging opportunities that test their skills and abilities.
My leader challenges employee to try out new and innovative way to do their work
Leaderschallenge_employeestobe_innovative
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 6 2.5 2.5 2.5
Disagree 25 10.6 10.6 13.1
Neutral 53 22.5 22.5 35.6

Impact of Risk Management on Project Performance 82
Agree 101 42.8 42.8 78.4
Strongly agree 51 21.6 21.6 100.0
Total 236 100.0 100.0
Table 29: Leaders challenge employees to be innovative
31 respondents (13.1%) of the study population strongly disagreed and disagreed that their
leaders does not challenge employees to try out new and innovative ways of doing their work.
53 respondents (22.5%) were neutral about the survey question. 152 respondents (64.4%) of
the study group agreed and strongly agreed that their leaders challenge employees to try out
new and innovative ways of doing their work
My leader asks, 'What can we learn?' when thing don't go as expected.
Leaderask_employeewhat_tolearn_when_thingsgo_wrong
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 4 1.7 1.7 1.7
Disagree 17 7.2 7.2 8.9
Neutral 47 19.9 19.9 28.8
Agree 113 47.9 47.9 76.7
Strongly agree 55 23.3 23.3 100.0
Total 236 100.0 100.0
Table 30: Leaders ask employee to learn when things go wrong
21 respondents (8.9%) of the research group strongly disagreed and disagreed that their
leaders do not ask “what they can learn” when things fail to go as expected. 47 respondents
(7.2%) were neutral. 168 respondents (71.2%) agreed and strongly agreed that their leaders
do ask “what they can learn” when things fail to go as expected.
My leader experiments and takes risks, even when there is a chance of failure.

Impact of Risk Management on Project Performance 83
Leadersexperiment_andtake_riskincase_offailure
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 20 8.5 8.5 8.5
Disagree 31 13.1 13.1 21.6
Neutral 53 22.5 22.5 44.1
Agree 106 44.9 44.9 89.0
Strongly agree 26 11.0 11.0 100.0
Total 236 100.0 100.0
Table 31: Leaders experiment and take risk in case of failure
51 respondents (21.6%) of the study population strongly disagreed and disagreed that their
leaders do not experiment and take risks even there is a chance of failure. 53 respondents
were neutral about the survey question. 132 respondents (55.9%) of the study population
agreed and strongly agreed that their leaders experiment and take risks even there is a chance
of failure.
My leader searches outside the formal boundaries of his/her organisation for innovative
ways to improve what we do.
Leaderskseek_innovativeways_toimprove_performance
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 7 3.0 3.0 3.0
Disagree 26 11.0 11.0 14.0
Neutral 67 28.4 28.4 42.4
Agree 95 40.3 40.3 82.6
Strongly agree 41 17.4 17.4 100.0
Total 236 100.0 100.0
Table 32: Leaders seek innovate ways to improve performance

Impact of Risk Management on Project Performance 84
33 respondents (14%) of the research group strongly disagreed and disagreed that their
leaders does nor search outside the formal boundaries of their organisations for innovative
ways to improve what they do. 67 respondents (28.4%) were neutral while 136 respondents
(57.7%) of the total study group agreed and strongly agreed that their leaders search outside
the formal boundaries of their organisations for innovative ways to improve what they do
My leader develops cooperative relationships among the employee that he/she works with.
Leadershave_cooperationwith_employee
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 10 4.2 4.2 4.2
Disagree 30 12.7 12.7 16.9
Neutral 59 25.0 25.0 41.9
Agree 101 42.8 42.8 84.7
Strongly agree 36 15.3 15.3 100.0
Total 236 100.0 100.0
Table 33: Leaders develop cooperation with employee
40 respondents (16.9%) of the whole study group strongly disagreed and disagreed that their
leaders have not developed cooperative relationships among their employees. 59 respondents
were neutral about the asked survey question.137 respondents (58.1%) of the study
population agreed and strongly agreed that their leaders have developed cooperative
relationships among their employees.
My leader supports the decisions that employee make on their own.
Leadersinvolve_employeein_decisionmaking
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 29 12.3 12.3 12.3
Disagree 54 22.9 22.9 35.2
Neutral 64 27.1 27.1 62.3

Impact of Risk Management on Project Performance 85
Agree 73 30.9 30.9 93.2
Strongly agree 16 6.8 6.8 100.0
Total 236 100.0 100.0
Table 34: Leaders involve employees in decision making
83 respondents (35.2%) of the study population strongly disagreed and disagreed that their
leaders does not support the decision that their employee make. 64 respondent (227.1%) of
the study group was neutral about the asked survey. 16 respondents (37.7%) of the study
group agreed and strongly agreed that their leaders support the decision made by their
employees.
My leader gives employee a great deal of freedom and choice in deciding how to do their
work.
Leadersallow_employeesfreedom_onhow_towork
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 13 5.5 5.5 5.5
Disagree 41 17.4 17.4 22.9
Neutral 68 28.8 28.8 51.7
Agree 90 38.1 38.1 89.8
Strongly agree 24 10.2 10.2 100.0
Total 236 100.0 100.0
Table 35: Leaders allow employees freedom on how to work
54 respondents (22.9%) of the study group strongly disagreed and disagreed that their leaders
does not give employees a great deal of freedom and choice in deciding how to do their work.
68 respondents were neutral about the matter On the hand, 114 respondents (48.3%) of the
total study population agreed and strongly agreed that their leaders give employees a great
deal of freedom and choice in deciding how to do their work.

Impact of Risk Management on Project Performance 86
My leader ensures that employee grow in their jobs by learning new skills and
developing themselves.
Leadersensure_employee_growth
Frequency Percent Valid Percent
Cumulative
Percent
Valid Strongly disagree 9 3.8 3.8 3.8
Disagree 19 8.1 8.1 11.9
Neutral 73 30.9 30.9 42.8
Agree 87 36.9 36.9 79.7
strongly agree 48 20.3 20.3 100.0
Total 236 100.0 100.0
Table 36: Leader ensure employee growth
28 respondents (11.9%) of the study population strongly disagreed and disagreed that their
leaders do not ensure that employees grow in their jobs by learning new skills and developing
themselves. 73 respondents was neutral about the above survey question. 135 respondents
(57.2%) of the study group agreed and strongly agreed that their leaders ensure that
employees grow in their jobs by learning new skills and developing themselves.
4.2 Normality Test
All project meet expectations
Descriptives
Statistic Std. Error
Allprojects_meet_expectatio
ns
Mean 3.64 .058
95% Confidence Interval for
Mean
Lower Bound 3.53
Upper Bound 3.76
5% Trimmed Mean 3.66
Median 4.00
Variance .783
Std. Deviation .885
Minimum 1

Impact of Risk Management on Project Performance 87
Maximum 5
Range 4
Interquartile Range 1
Skewness -.426 .158
Kurtosis -.333 .316
Table 37: Normality test
Tests of Normality
Kolmogorov-Smirnova Shapiro-Wilk
Statistic df Sig. Statistic df Sig.
Allprojects_meet_expectatio
ns .283 236 .000 .865 236 .000
a. Lilliefors Significance Correction

Impact of Risk Management on Project Performance 88
Case Processing Summary
Gender
Cases
Valid Missing Total
N Percent N Percent N Percent
Allprojects_meet_expectation
s
Male 126 100.0% 0 0.0% 126 100.0%
Female 110 100.0% 0 0.0% 110 100.0%
Descriptives
Gender Statistic Std. Error
Allprojects_meet_expectatio
ns
Male Mean 3.06 .066
95% Confidence Interval for
Mean
Lower Bound 2.93
Upper Bound 3.19
5% Trimmed Mean 3.08

Impact of Risk Management on Project Performance 89
Median 3.00
Variance .556
Std. Deviation .746
Minimum 1
Maximum 4
Range 3
Interquartile Range 1
Skewness -.221 .216
Kurtosis -.814 .428
Female Mean 4.31 .044
95% Confidence Interval for
Mean
Lower Bound 4.22
Upper Bound 4.40
5% Trimmed Mean 4.29
Median 4.00
Variance .216
Std. Deviation .464
Minimum 4
Maximum 5
Range 1
Interquartile Range 1
Skewness .838 .230
Kurtosis -1.323 .457
Male Skewness
-.221/.216 = -1.0231
Male Kurtosis
-.814/.428 = 1.9019
Female Skewness
.838/.230 = 3.6435
Female Kurtosis

Impact of Risk Management on Project Performance 90
-1.323/.457 = -2.8950
4.3 Reliability Test
The “Cronbach alpha” scale test was used to results. The coefficient normality range between
zero and one.
Reliability Statistics
Cronbach's
Alpha
Cronbach's
Alpha
Based on
Standardize
d Items
N of
Items
.989 .991 21
The reliability statistics table shows the Cronbach alpha value as .989, a reflection of high
reliability of the relationship between risks management, project performance and leadership
effectiveness.
4.4 Hypothesis
H1: Risk management has a significant positive impact on project performance
H2: Risk management has a significant positive impact on leadership effectiveness
H3: Leadership effectiveness has a significant positive impact on project performance
H4: Impact of risk management on project performance is mediated by leadership
effectiveness 4.5 Discussion of Hypothesis Findings

Impact of Risk Management on Project Performance 91
With regard with to the reliability test it shows that there is a close relationship between risk
management, project performance and leadership effectiveness. As a result, this means that
all null hypothesis (H0) are accepted while all alternate hypothesis (H1) are rejected.

Impact of Risk Management on Project Performance 92
Chapter 5 Conclusion and Recommendation
Conclusion
The core aim of undertaking this study is to determine the relationship between risk
management and readership effectiveness on project performance. In this study two major
were identified that is risk management and leadership effectiveness. The goal of the study
was to determine how these two variables impact project performance. With respect to the
above research findings, it is concluded that risk management mediated by leadership has a
significant impact on project performance. Unfortunately, there are some issues that are still
affecting risk management, project performance and leadership effectiveness. Risk
management is important when it comes to project performance for instance it influenced the
managing behaviour of projects. In order for risk management to be effective it calls for vast
skills and experience on matters related with risk. On the same note in order to ensure project
performance organisations use performance control tools such as KPIs, motivate employees
to be creative and innovative when it comes to countering risks. Also, managers are supposed
to motivate employees on how to handle risks by providing them the necessary tools to
counter risk. Leadership effectiveness is also key to project performance and risk
management. For example, effective leaders ask employees things that they learn through
risks that face projects and also seek challenging opportunities as a strategy to test their
abilities in terms of risks management.
Objective 1: To determine the impact of risk management on project performance
The first objective was to determine the impact of risk management on project performance.
In regard to most of the previous studies that were undertaken it was concluded that risk
management plays a key influence on project performance (Hillson, and Murray-Webster,
2017). The first hypothesis of the research was upheld because according to the responses

Impact of Risk Management on Project Performance 93
received from the study population a majority of the respondents asserted that indeed, risk
management had a positive impact on project performance.
Objective 2: To identify the impact of risk management on leadership effectives
The second objective was to identify the impact of risk management on leadership
performance. A majority of the past studies concluded that risk management on leadership
had a positive influence on performance (Ahmed, and Anantatmula, 2017). Tupa, Simota,
and Steiner (2017) based on their research about aspects of risk management implementation
in the industrial sector revealed that leaders who positively considered risk management in
their leadership positively contributed towards performance. Also the reliability test also
confirmed the same from the research findings through the Cronbach alpha value as .989.
Objective 3: To analyse the impact of leadership effectiveness on project performance
The third objective was to analyse the impact of leadership effectiveness on project
performance. Based on some of the previous researches both empirical studies across the
globe and those within Malaysia it was concluded that leadership effectiveness. For example,
Anderson, and Sun, (2017) regarding transformational leadership theory; Wong, and Giessner
(2018) based on laissez-faire leadership effectiveness and Lynch (2015) about situational
leadership effectiveness shows that leadership plays a key impact on project performance.
Based on the normality test the case processing summary shows that 114 respondents which
is 48.3% of the whole study population agreed and strongly agreed that all project meet
expectations which is assumed to even leadership effectiveness which is part of the project
aspects significantly influence project performance.
Objective 4: To evaluate the mediated effect of leadership effectives on the relationship
between risk management and project performance

Impact of Risk Management on Project Performance 94
The forth and the last objective was to evaluate the mediated effect of leadership
effectiveness on the relationship between risk management and project performance. To
name a few previous studies such as Jacob, Madu, and Tang (2012); Carvalho, and Rabechini
Junior (2015); Renz, and Herman (2016) and Datta (2015) they concluded that there a
correlation between meadiated leadership effectiveness on the relationship between risk
management and project performance. The respondents through the reliability statistics
shown through the Cronbach alpha value as .989, it reflects high reliability on mediated
leadership effectiveness on the relationship between risks management and project
performance.
Recommendation
Based on the research results as well as the literature review the following are some of the
recommendations in order to ensure improved risk management on project performance
mediated by effective leadership.
 In order to enhance project performance, Malaysian organisations need to ensure its
employees have attained high competency skills to boost their experience in terms of
risk management.
 Business organisations across Malaysia should provide employees with the necessary
requirements for managing risks as a way of motivating. In this sense, employees will
be motivated to counter project risks competently hence leading to improved
performance.
 Leaders in Malaysian companies are encouraged to involve employees in decision-
making process on matters related to risk management because it will make them feel
appreciated hence boosting their work morale that will in turn increase their
productivity.

Impact of Risk Management on Project Performance 95
 The Malaysian PLCs should also establish standardised laws to govern the enterprise
risk management process.
Future Research Opportunity
After completing this research, the knowledge gained through this study could be useful in
future studies since risk keeps on changing over time. Therefore, this study will provide a
basis for further research on the research topic in future.
Limitations
Although the research met the study objectives, at the time of carrying out the research the
researcher noticed some limitations. First the researcher applied a convenience sampling that
primarily rely on the presence of study respondents to complete the question. Second, another
limitation that was experienced during the research was limited time provided to undertake
the study based with the minimal time available for the course. Third the sample size used
was small and acted as a representative of a big research population hence some aspects had
to be assumed. Lastly, the questionnaire was made available to respondents in English
language only hence language barrier could have been an issue to respondents who had
interest in taking part in the study but had no alternative language interpreter.

Impact of Risk Management on Project Performance 96
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Appendix
Appendix A: Research Questionnaire
Impact of Risk Management on Project Performance Mediated by Leadership Effectiveness
Dear Respondents,
I'm conducting a study to assess the 'Impact of Risk Management on Project Performance
Mediated by Leadership Effectiveness for my MBA final project assignment. This study will
attempt to determine how the leadership effectiveness will impact project performance from
risk management perceptive. Your response to this survey will not consume much of your
time with an approximate time of 10 minutes or less.
Please be assured that your response are strictly confidential and only to be used for academic
research. In no circumstances your name will be reflected in this survey nor revealed in any
reports. You are free to withdraw your consent to participate and discontinue your
participation in the study at any time without consequences. Your participation will be
anonymous, and all your responses and information shall be kept strictly confidential and for
academic purpose only. Thank you for taking time to complete this survey. If you wish to
receive a copy of the results from this study, or have any questions pertaining to it, please
contact me at [e-mail]
Demographic
Please mark on the appropriate box
Gender *

Impact of Risk Management on Project Performance 116
a) Female
b) Male
Age Group *
a) 18 - 25
b) 26 - 35
c) 36 - 45
d) 46 - 55
e) 55 and Above
Income (RM) *
a) 1,200 - 3,000
b) 3,001 - 5000
c) 5,001 - 10,000
d) 10,001 and above
Educational Level *
a) Primary
b) Secondary
c) Diploma / Degree
d) Masters
e) PHD
Types of Business Organisation *
a) Partnership
b) Sole Proprietorship
c) Private Limited Company

Impact of Risk Management on Project Performance 117
d) Public Limited Company
e) Limited Liability Partnership
f) Others
Risk Management
Please rank each of the following statements. Please select at the appropriate options from the
5 Likert Scale: 1 = strongly disagree, 2 = disagree , 3 = neutral , 4 = agree 5 = strongly agree .
In my organisation risk management approach is used to identify potential impact to enhance
project performance *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
People in my organisation considered risk management is important in managing the project
*
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, people generally go through a formal/informal risk management process.
*

Impact of Risk Management on Project Performance 118
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, risk management is seen as contributing factor in project performance *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, risk management is seen as influence behavarial in managing the project
*
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
The experience/competence level plays an important part in the outcome of significant risk
management *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree

Impact of Risk Management on Project Performance 119
e) Strongly Disagree
Project Performance
Please rank each of the following statements. Please select at the appropriate options from the
5 Likert Scale: 1 = strongly disagree, 2 = disagree, 3 = neutral, 4 = agree 5 = strongly agree.
In my organisation, generally all projects completed and meet the expectations.
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, KPIs has been established and implemented for all projects as part of
performance monitoring tool.
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, project performance was reviewed from the beginning, progress till
completion by the organisation leadership.
a) Strongly Agree
b) Agree
c) Neutral

Impact of Risk Management on Project Performance 120
d) Disagree
e) Strongly Disagree
In my organisation, the potential risk in project the will be identified and addressed
accordingly
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, all projects were delivered within the financial budget.
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, all projects completed with very minimal complaints
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, the leadership team seriously look into the complaint as part of future
project improvement.

Impact of Risk Management on Project Performance 121
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, competency and relevance experiences are the key factors in project team
members.
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
In my organisation, the leadership motivate and provide clear directions and resources
required.
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
Leadership Effectiveness
Please rank each of the following statements. Please select at the appropriate options from the
5 Likert Scale: 1 = strongly disagree, 2 = disagree, 3 = neutral , 4 = agree 5 = strongly agree .

Impact of Risk Management on Project Performance 122
My leader talks about future trends that will influence how employee work gets done. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader describes a convincing image of what employee future could be like. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader speaks with honest principle about the higher meaning and purpose of employee
work. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader seeks out challenging opportunities that test his/her own skills and abilities *
a) Strongly Agree
b) Agree
c) Neutral

Impact of Risk Management on Project Performance 123
d) Disagree
e) Strongly Disagree
My leader challenges employee to try out new and innovative way to do their work *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader asks, 'What can we learn?' when thing don't go as expected. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader experiments and takes risks, even when there is a chance of failure. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader searches outside the formal boundaries of his/her organisation for innovative ways
to improve what we do. *
a) Strongly Agree

Impact of Risk Management on Project Performance 124
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader develops cooperative relationships among the employee that he/she works with. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader supports the decisions that employee make on their own. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
My leader gives employee a great deal of freedom and choice in deciding how to do their
work. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree

Impact of Risk Management on Project Performance 125
My leader ensures that employee grow in their jobs by learning new skills and developing
themselves. *
a) Strongly Agree
b) Agree
c) Neutral
d) Disagree
e) Strongly Disagree
The End
Remarks: The data obtained from this survey would be used entirely for the purpose of
academic research only.