The impact of incentive mechanisms on project performance

Xianhai Meng*, Brendan Gallagher

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

83 Citations (Scopus)


Contractual incentives have been increasingly practised in construction projects. In this study, a questionnaire survey is carried out in the United Kingdom (UK) and the Republic of Ireland (ROI) to analyse the relationship between the use of incentives and the performance of a project. The analysis is made in a comparative way. First of all, four payment methods are compared in terms of their impact on cost performance. Secondly, incentive projects are compared with non-incentive projects in terms of time and quality performance. Thirdly, both time and quality performances are compared between the projects with a single incentive and those with multiple incentives. The analysis results provide empirical evidence for the significant impact of incentive mechanisms on project performance. Subsequent to the questionnaire survey, a case study is conducted to examine how to appropriately apply incentives in practice, revealing that the use of incentives aligns the contractor's objectives with the client's expectations
in a project and in order to ensure the success of incentive mechanisms the contractor needs to make extra efforts for the enhancement of project management processes, the creation of collaborative working environments, and the motivation of his staff and workforce.
Original languageEnglish
Pages (from-to)352-362
Number of pages11
JournalInternational Journal of Project Management
Issue number3
Early online date15 Sep 2011
Publication statusPublished - Apr 2012

ASJC Scopus subject areas

  • Business and International Management
  • Management of Technology and Innovation
  • Management, Monitoring, Policy and Law


Dive into the research topics of 'The impact of incentive mechanisms on project performance'. Together they form a unique fingerprint.

Cite this