Every research applies a specific research approach to arrive at a given conclusion based on the availability of time and resources. According to Powell (2010, p. 26), it is important to choose the most appropriate research method that would provide highly reliable data because many people always depend on the reports given by such research. In this study, the researcher was keen on identifying the most appropriate research method that would give the desired result. The researcher used a mixed method because both qualitative and quantitative methods were important in this research. The quantitative research method is a kind of study that uses figures to arrive at certain conclusions. This research will take the form of a survey, which means that the researcher will identify the sample population and send questionnaires to them. In the research, there was a need to compare the relationship between variables to establish cause and effect. The researcher was interested in knowing how financial risks (independent variables) affected the performance of government projects in Dubai (dependent variables). It demands a method that is objective and able to generalize the findings statistically. The quantitative method would be one of the most appropriate approaches to use in this research.
The quantitative research method involves the systematic empirical study of a given phenomenon by the use of statistical tools. The main objective is always to use mathematical models and theories to develop its generalization. For this reason, the quantitative method would be very important in this research. It would make it possible for the researcher to test the hypotheses put forth for validity and enable the use of a sample as a representation of the entire research population. It would help the researcher to use the data to determine the effect of financial risks on the performance of government projects in Dubai. The quantitative research method would also help in the statistical determination of any relationship between the performances of government projects in Dubai, and the associated financial risks that may occur during the process of implementing them.
Although qualitative research methods were conventionally used in social science and would be appropriate in this research, the method is not able to give empirical support for the research hypothesis. Qualitative research methods explain why a given pattern of events or phenomena has taken place the way they have. On the other hand, quantitative research methods explain the what and when of a given phenomenon. Ethnographic research and phenomenology as approaches to qualitative research would have been appropriate. Ethnography would help in the investigation of the culture of the Emirati society, especially the way government projects are always handled. Phenomenology would help investigate the realities of the government projects in Dubai based on the past projects within this city. However, because the process may not empirically support the hypotheses put forward to help guide the research, it must be supported by quantitative research to validate the findings. Due to the above-stated reasons, the researcher found it necessary to use both qualitative and quantitative research methods in concluding.
The research gave a lot of emphasis on the theoretical framework in this research. According to Powell (2010, p. 78), it is always important to base research on some of the theoretical perspectives when conducting a piece of research to help validate or critique a given theory. This helps in building knowledge in that particular area. Several theoretical frameworks have been developed to help explain the impact of financial risks on government projects. Although some of these theories and models were developed under different environmental patterns from that of Dubai, they can still be relevant if local factors are considered. The theoretical framework used in this research focused on local factors within Dubai to increase their validity to this research.
The Focus of the Research
It is always very important to understand the specific issue under investigation in any piece of research. According to Powell (2010, p. 37), research can be focused on a given problem that needs a solution, or an issue that is generally important to some members of the society. In this research, the focus is on the effects of financial risks on government projects. The government of Dubai has committed a lot of finance on various projects to improve the infrastructure and other facilities within the country. Most of these projects have been very costly, and for this reason, there is a need to ensure that they are properly planned to ensure that they do not cost more than their initial estimates. There are some instances in the past when some government projects had their initial costs going beyond the initial estimates. According to Boussabaine (2013, p. 78), Dubailand is one of the most ambitious government projects in recent times. The project was started in 2003, and its cost was estimated to be $ 64.3 billion. However, the project has experienced massive negative effects due to the inflation in the country and the rising cost of construction materials. This has seen the cost of the projected rise at an unprecedented rate. This means that the actual cost would be much higher than the initially estimated amount. Although the policymakers have not come out strongly to state that this is a major problem that government projects face, it is an obvious fact that it is an issue that should be addressed with urgency to find a lasting solution of how it can be addressed. This research is, therefore, investigating a problem that is associated with government projects. The problem under investigation is the financial risk associated with government projects.
Theory and Models Used in the Research
It was mentioned above that this research will focus on some of the theories and models that have been developed by previous researchers to determine their appropriateness in understanding the effects of financial risks on government projects. According to Keller (2011, p. 89), there has been a problem in using some of the conventional theories and models because they were developed by researchers in the West. Some of the guiding environmental principles they used were based on the environmental factors in the United States or European nations. Such environmental factors may be very different from the local environmental factors in Dubai. The researcher decided to use these theories and models in the local context as a way of coming up with related models that can be used locally. The researcher evolved these existing models and theories to fit in the local context in Dubai.
Testing Specific Hypothesis
Hypotheses are always important in any piece of research. It is always a forecast of what a researcher expects to find in a given piece of research. In this research, it was important to work with a general hypothesis that would facilitate further investigation. The following was the main hypothesis that was used as a guiding principle in this research.
Financial risks have serious impact on the governmental projects in Dubai
The researcher believed that financial risks had a serious impact on governmental projects in Dubai. This research hypothesis would validate the need for further investigation to determine these risks and their impact on government projects.
This research is focused on policy formation in government projects. When reviewing relevant literature, it was clear that the government of Dubai lacks a clear and comprehensive policy when it comes to managing financial risks in government projects. Although policymakers have come up with various guidelines that should be followed when making financial plans for government projects, it is still not clear how the arising financial risks in government projects can be managed. It is, therefore, important to come up with a body of policies that can be used in managing these risks. This is the main focus of the research.
Modifying Existing Theories and Models
As stated above, this research would focus on some of the existing theoretical frameworks with the view of modifying them to be relevant in the local context. Most of these theories were developed in the West, and for them to be applied in the local context, there may be a need for some modification. In this research, it would be important to incorporate some of the financial theories and models, but only when they are relevant to the local context based on the environmental factors in Dubai. In cases where necessary, the researcher modified the models to make them relevant to the local context. The research also involved gathering existing research in chapter two which was a review of the literature.
The theoretical framework used in this study was focused on how financial risks affected government projects and how these risks can be averted to eliminate their negative impacts. Several theories were used in this research to explain some of the financial risks that are associated with government projects. Probability theory was used in determining the probability of a given financial risk occurring in a government project. Sensitivity analysis was used in determining how financial risks of different magnitudes can be managed. The theory of constraints was very appropriate in identifying different financial constraints within a project, and how these constraints can be identified and properly addressed. Delphi method was also used as an appropriate model in managing financial risks in government projects in Dubai.
Research may take different approaches based on its nature, the materials available, and the time limit within which it should be completed. As Powell (2010, p. 91) notes, it is very important to understand the nature of the research before choosing the most appropriate research approach to be used. This research study used qualitative and quantitative research approaches. The quantitative research approach was used because there was a need to test the findings empirically before concluding. It was chosen because of its appropriateness when using mathematical models. The research also used a qualitative approach because of its descriptive nature. There was a need to describe some of the practices encouraged or tolerated by the government that may decrease or heighten the possibility of financial risks occurring in government projects. This description could be done more appropriately when using a qualitative approach in the research. Other approaches were not used in this research. The research did not use an advocacy (participatory/emancipatory) approach because of the time that was available in conducting the research. It would be beneficial to use the advocacy approach because the issue under investigation affects every citizen of this emirate, but this approach requires a lot of time, and it also involves a lot of compromises that may not be tolerated in academic research. It was, therefore, avoided in this research.
Type of Analysis
It has been mentioned above that this research uses two main approaches with are the quantitative and qualitative research methods. It would be important to understand the type of data analysis used in this research to help in understanding the validity of the research. According to Powell (2010, p. 98), data analysis is one of the most important stages in researching because the conclusion would always be based on it. This scholar further says that the choice of analysis tool should always be guided by the nature of the research. In this research, qualitative and quantitative approaches were used because they were considered appropriate in helping arrive at the desired answers. When using a qualitative approach, the type of analysis that would be used would be the phenomenological approach. This descriptive nature of analysis would help explain some of the issues that have been associated with financial risks in a government project. It would facilitate an explanation of how the government of Dubai has always approached the issue of financial risks with different contractors, and how this approach is tolerated or abhors such risks, especially when they are caused by unscrupulous individuals who are focused on personal gains. The phenomenological analysis would also facilitate a description of previous projects which took place in the past in Dubai, the financial risks they faced, and how these risks were addressed by the relevant authorities. This would form the basis of predicting future financial risks that may affect government projects, and how authorities would address the risks to avert any negative consequences associated with them. The quantitative method would involve statistical analysis of the data gathered from the sampled respondents. As was mentioned, the researcher will use stratified sampling to select a sample population that will take part in the research. The researcher then sent questionnaires to the sampled population, who sent them back after responding to the questions. This data was analyzed statistically using SPSS (Statistical Package for Social Scientists) software, version 20.
According to Powell (2010, p. 114), it is always necessary to ensure that the type of analysis chosen is congruent with the research question or the purpose of the research. This is important because when using a statistical approach, the nature of the question should be that which can be responded to statistically. The researcher was keen on ensuring that there is congruency in this research. The research questions are very congruent with the research approach that was chosen. The first and the third questions in this research required statistical analysis in drawing the answers. The two questions are stated below.
What is the impact of financial risks on the governmental projects in Dubai?
What are some of the appropriate measures of dealing with these risks in case they take place during the project implementation process?
The two questions above can be analyzed statistically to arrive at the desired conclusion. The first question needs to identify the financial risks, which can be stated statistically by mentioning the risks and numbering them. The second question focuses on the appropriate measures that can be taken to address the risks. This question can also be analyzed statistically. The question below, which is the second research question in this paper, can be addressed more appropriately using the phenomenological approach.
How can the government officials in the department of planning, public policy, and management predict these risks before they take place?
It seeks to find a way in which the government can deal with the identified financial risks. To come up with the most appropriate approach to dealing with the issue, it would be necessary to describe the current approach used and identify some of the weaknesses. It would also be important to describe the approach taken by other governments considered successful. From this description, it would be easy to come up with the most appropriate approach that can be used by the government of Dubai.
The methodology that was chosen for this research was very appropriate for the style of analysis chosen. As explained above, using qualitative and quantitative methods was necessary for arriving at the desired answers. The two methodological approaches would help facilitate both descriptive and statistical analysis of data. The theoretical framework supports the type of analysis used in this research. The theoretical framework that was used in this research demonstrated that to deal with some of these financial challenges, it is necessary to understand some of the past events to determine the trend. Understanding these events is supported by a phenomenological analysis that was used in this research. The approaches (theories and models) chosen in this research determine the kind of analysis to conduct. The researcher used different theories and models related to financial risks in government projects. Some of the theories and models required statistical analysis, while others required phenomenological analysis.
According to Powell (2010, p. 116), it is important to ensure that the analytical techniques used are consistent with and lead to results appropriate to the research question. The research used three research questions. As explained above, the first and the third questions required statistical analysis, while the second question required phenomenological analysis. This means that the technique used was consistent with the research question. The technique was capable of giving the desired answers based on the stated research question. The analytical technique used in this research was developed after reviewing the theoretical framework. The technique was derived from the theoretical framework to ease the process of analysis. The theoretical framework acted as a guide when selecting the appropriate analytic technique to be used in the research. Finally, the researcher was very keen when selecting the materials for the research. The authors used in the reference were individuals who commanded a lot of respect in this field. The research was supported by references to supporting the techniques used, the theories and models, and the interpretation.
List of References
Boussabaine, H 2013, Risk pricing strategies for public-private partnership projects, Cengage, New York.
Keller, G 2011, Comparing the Affects of Management Practices on Organizational Performance Between For-Profit and Not-For-Profit Corporations in Southeast Wisconsin, Journal of Management Policy and Practice, vol. 12 no. 5, pp. 86-95.
Powell, G 2010, Understanding Quantitative Research Methods, SAGE, London.