Application of performance measurement as an early warning system A case study in the oil and gas industry

Purpose - The purpose of this paper is to present an overview of the concept of early warning signs in projects and explain how a performance measurement system can be utilized as a source of data for an earlywarning approach signaling that a project is about to experience problemsat somestage in the future. Design/methodology/approach - Combination of action research and semi-structured interviews and document analysis supplemented by a post-mortem analysis after project close-out. Findings - Detection of early warning signals in projects can be better enabled through the application of a performance measurement system with properly defined key performance indicators. Utilization of this tool can positively affect the overall success of the project. Research limitations/implications - The case study involved only one project from the oil and gas industry. Practical implications - The empirical case study was developed to illustrate the usefulness of exploiting a performance measurement system in a project. A procedure was demonstrated for developing and implementing an early warning system based on performance measurement, and specific performance indicators have been described for other projects to copy. Originality/value - This paper highlights the gap in the literature concerning the link between early warning and project management and the link between early warning and performance measurement. It offers a new idea on how performance measurement can be used as an effective early warning system and is intended to be primarily of use to project management practitioners and practically-oriented academics who are interested in developing fresh insights into new approaches for better management of projects.