Apresentação no 8th International Doctoral Consortium Université de Paris XI

1. Impact/legacy measurement and evaluation in
mega events projects with focus on intangible
assets
Mauricio Nunes Rodrigues
Marcos Cavalcanti (COPPE/UFRJ)
Ahmed Bounfour (UPSUD)
The 8th International Doctoral Consortium on Intellectual Capital Management
27 may 2015

2. Content
1. Introduction
2. Research Question
3. Methodological approach
4. Model development
5. Model validation study (FIFA 2014 World Cup
Tourism impacts)
6. Next steps

3. 1. Why hosting mega event projects?
• Increasing number of stakeholders interested in hosting
international mega events, despite criticism regarding:
• costly and complex bidding and implementation projects
• actual scene of poor performance in terms of public support
and economic / environmental outcomes
• Why these stakeholders place value on hosting such events (e.g.
Olympic Games, Sports World Championships, Festivals, Cultural
and Political summits)?

4. 1. Potential economic benefits
Directs
• Capital flow to host city/country
• Infrastructure construction or
upgrade
• Lower transportation costs due
improved networks
• Increase in tourists spending
Indirects
• Advertising effect of the host
city/country as a potential
tourist or business destination
• more local business
opportunities
• Improved local sense of
community and civic pride
• Improved perceived abroad
image of the host city/country
• Citizen entertainment and
welfare
• Human resources skills
development
• Motivation to a more active life
(Clark, 2008; Kasimati, 2003;
Preuss, 2007; Preuss, 2010;
Zimbalist, 2010)

5. 1. Potential downsides / risks
• Don`t be able to deliver all positive impacts (planned or unplanned)
• Socially unjust displacement and re-distributions
• Poor urban land use
• Underused facilities after the event
• High public debts
• Excessive costs
• Athens 2004  more than US$ 10 bi
• Beijing 2008  more than US$ 40 bi
• London 2012  about US$ 15 bi
(Cashman, 2010; Haußermann & Simons, 2000; Flyvbjerg et al. 2003; Zimbalist, 2010)

6. 1. Costs x Investment - Are it worth it?
• Key role on public policies and investment (tourism and business
destination attractiveness, business growth, urban regeneration,
and infrastructure, image, environmental and local population
quality of life improvements)
(Clark, 2008; OECD, 2010; Orueta & Fainstein, 2008; Preuss, 2007; Zimbalist, 2010)
• When hosted well, the mega event project can play a significant
role in city/region local development, growth and competitiveness
(OECD, 2010)
• The benefits do not occur by accident or without an effective action
 Need strategic vision and a proper impact planning and
management
(Clark, 2008; IOC, 2009b; OECD, 2010)

7. • Impact strategic planning and forecasting traditionally done by
a best practice / benchmarking approach with basis on tangible
socio-environment-economic indicators
(Preuss, 2007)
• Do not provide relevant information for effective decision-
making, neither for the strategic management of the future
positive impacts, legacies and benefits
• The value of nations, regions, organizations is directly related to
their intangible capitals and depends on systems to visualize,
cultivate and capitalize on value-creation interactions
(Edvinsson, 2003; Edvinsson & Bounfour, 2004)
1. Impacts planning and management

8. 2. Research question
How could we measure and evaluate the impacts
generated for and by mega event projects, taking into
account the intangible assets, with a focus on future
value creation (legacies)?

9. 3. Methodological approach
• Qualitative and strategic design with basis on the
intangibles approach
Hypothesis Evidence
1. The mega event project’s decision-makers
and managers should base their decisions
not only on tangible socio-environment-
economic analysis
The traditional approaches to mega projects
performance measurement and evaluation
are insufficient to support the strategic
maximization of the potential benefits
(Flyvbjerg et al., 2003)
2. The measurement and evaluation of the
intangible aspects can help to improve the
significance of the positive impacts expected
by some stakeholders
The intangible assets have become strategic
factors for value creation, and are considered
central factors to economies’ growth and
competitiveness (OECD, 2008)
3. It is possible to develop a reliable
operational method to measure and evaluate
the mega event projects intangible aspects
????

10. 3. Objective
To develop a diagnostic model for measurement and
evaluation of the mega event projects impacts and
legacies, taking into account the intangible assets

11. 3. Methodological approach

12. 4. Model development
• Focus
• to identify the relevant intangible assets, the
interdependencies between then, the success factors
generated, and the variables that should be collected
• Strategy = research case study
• To guarantee the external validity and follow the strategic
approach
• To prevent the lack of a real-life event context and a well
defined objective to the impact analysis
• Widely used in organizational and managerial studies when the
investigators are interested in understand complex social
phenomena (Kohlbacher, 2006; Yin, 2003)

13. 4. Model development
• Case analysis
• Assessment and evaluation of the impacts on the intangible
assets and outcomes of the FIFA 2014 World Cup interventions
on the Rio de Janeiro city tourism industry
• Mixed approach
• Based on the Intangible Capital Rating - CRIE/BNDES
(Deutscher, 2007, 2008 and Cavalcanti, 2007) and the
Intellectual Capital Dynamic Value - IC-dVAL (Bounfour, 2000,
2003)
CRIE/BNDES IC-dVAL
Identification of the assets which the
organizations should have to
implement their future vision
Integration of a link between the
financial value of assets and the
internal performance

14. 4. The MEI2 Model
The operational version of the Mega Event Intangibles Impacts
Model (MEI2 Model) consist of:
• 5 Dimensions
• 15 Assets (resources, competencies and processes)
• 42 Indicators

15. 4. The MEI2 Model

16. 5. The MEI2 Model Validation
• Data collection
• Interviews with FIFA 2014 World Cup stakeholders directly and indirectly
impacted by the interventions on the Rio de Janeiro city tourism industry
• The sample was divided in two groups
• Focus
• Stakeholders perceptions of the performance and impacts of the
interventions on the intangible assets and outcomes listed as main sources
of competitive advantage for its strategic objectives
Internal stakeholders External stakeholders
Decision-makers and local project
management staff from
government bodies
Tourism industry business
associations and unions
Other sectors business
associations and agencies
Megaproject / event specialists

17. • Data collection in 3 steps
• Step 1 – Impact analysis
• Step 2 – Foundations of the stakeholders perceptions
• Step 3 – Identification of the ideal competitive positioning
5. The MEI2 Model Validation
Improved
No
impact
Worsened
Completely Quite Somewhat Slightly Neutral Slightly Somewhat Quite Completely
2,0 1,5 1,0 0,5 0 -0,5 -1,0 -1,5 -2,0

18. 5. The MEI2 Model Validation

19. 5. Preliminary results
Intangible capital
dimensions
Internal
stakeholders
mean (±sd)
External
stakeholders
mean (±sd)
Human 35,0% (0,07) 21,7% (0,08)
Strategic 15,0% (0,00) 26,7% (0,13)
Structural 22,5% (0,11) 16,7% (0,06)
Ecosystem 12,5% (0,14) 18,3% (0,05)
Relationship 15,0% (0,00) 16,7% (0,04)
No significant difference between groups (Student’s t-Test)
Degree of importance (the relative value) for each dimension of intangible capital

20. 5. Preliminary results
Performance Ratings of the FIFA 2014 World Cup interventions on the Rio de Janeiro
city Tourism industry

21. 5. The MEI2 Model Validation
• Preliminary conclusions
• The concentration of importance in human capital by internal
stakeholders (35% of the overall weight) was reflected in the division
of financial resources to professional and languages skills training
(about 74% of specific budget for tourism intervention)
• The strategic positioning captured by the model in both groups (but
more concentrated in internal stakeholders) leads us to infer that the
strategic positioning of tourism interventions was more focused on
project execution internal questions than to the lasting potential
benefits of the project for the tourism
• The Overall performance rating (11,5%) situated in the first
improvement quartile indicated a fair overall positive impact of the
FIFA 2014 World Cup interventions on the Rio de Janeiro city Tourism
industry
• There is a significant different performance perception between the
two groups of stakeholders (38,5% - internal X 2,5% - external)
derived by a pessimist perspective from the external stakeholders

22. 6. Next steps
• Increase the sample
• to expand the field of analysis. E.g., increasing the number of
subgroups regarding the external stakeholders (tourism industry, non-
tourism industry and megaproject specialists)
• To reduce the risk of the Type I error (false positive) in comparisons
between groups
• Collect data about the intervention expenditures for each dimension of
intangible capital
• to calculate the dynamic value of the Intangible capital
• Define a set of external indexes and socioeconomic indicators
• to compare and benchmarking the expected benefits (tourism and
business destination attractiveness, business growth, urban
regeneration, and infrastructure, image, environmental and local
population quality of life improvements) with our results

23. Thanks for your attention!
Questions and comments?
Mauricio Rodrigues
mauricio@pep.ufrj.br