Assessing the Impact of Cost Overrun Causes in Transmission Lines Construction Projects

2020 ◽  
Vol 24 (4) ◽  
pp. 1029-1036 ◽  
Author(s):  
Hai Pham ◽  
Truong-Van Luu ◽  
Soo-Yong Kim ◽  
Duc-Thinh Vien
Keyword(s):  
Transmission Lines ◽  
Construction Projects ◽  
Cost Overrun ◽  
The Impact

Investigation of Cost-Influencing Factors Potentially ‎Controllable by Main Contractors in Construction Projects in ‎Iraq

2020 ◽  
Vol 38 (7A) ◽  
pp. 1069-1076
Author(s):  
Layth T. Ali ◽  
Raid S. Abid Ali ◽  
Zeyad S. M. Khaled
Keyword(s):  
Construction Projects ◽  
Project Managers ◽  
Cost Overrun ◽  
Public And Private ◽  
Importance Index ◽  
Labor Recruitment ◽  
Supply Planning ◽  
Major Factors ◽  
And Control ◽  
The Impact

Cost overrun in construction projects is a common phenomenon in Iraq. This might occur due to diversity of factors. This study aims to identify the factors influencing construction projects cost that are potentially controllable by main contractors. A field study through a questionnaire survey was directed to a sample of related Iraqi professional engineers from general contracting companies at both public and private sectors. Their opinions on the impact and frequency of each factor were investigated. The questionnaire offered (59) factors classified in (8) categories namely; legislations, financial and economic, design, contractual, site management, material, labor and equipment. The factors were ranked according to the highest Relative Importance Index (RII). The study revealed (10) major factors that are potentially controllable by main contractors namely; labor productivity, sub-contractors and suppliers performance, equipment productivity, site organization and distribution of equipment, experience and training of project managers, scheduling and control techniques, planning for materials supply, planning for equipment supply, materials delivery and planning for skilled labor recruitment. Recommendations to aid contractors and owners in early identification of these factors are also included in this study.

scholarly journals Estimation of cost overrun in construction projects using Fuzzy Logic

2021 ◽  
Vol 23 (05) ◽  
pp. 797-805
Author(s):  
Neelakash Haloi ◽  
◽  
Tapas Goyal ◽  
Faizan Zahoor ◽  
Harsh Jain ◽  
...  
Keyword(s):  
Fuzzy Logic ◽  
Construction Projects ◽  
Cost Overrun ◽  
Time Data ◽  
Construction Companies ◽  
Five Factors ◽  
Spss Software ◽  
The Cost ◽  
The Impact ◽  
Published Research

In recent years, the impact of the construction industry on the economy of India is increasing. However, there are a number of problems that are being faced by the construction companies or contractors or other relevant stakeholders, in the completion of a construction project. One of the major problems being faced is time and cost overrun. Thus, it is important to find ways of mitigating this critical problem. One of the solutions that is being used is the prediction of the amount and time that a project might overrun beforehand i.e. estimating the overrun during the design phase itself. This prediction can be done using a number of different techniques, the important one of which used in this paper is through the use of Fuzzy Logic. It also provides a brief description about the factors that are responsible for causing this cost overrun. The factors are identified by conducting a questionnaire survey and gathering responses from the relevant stakeholders which include contractors, project engineers, architects and consultants. The responses collected are further processed and analysed using SPSS software. The top 5 factors have been selected after the analysis and further used in preparation of the fuzzy logic model in the fuzzy toolbox of MATLAB. Further, the validation of this model has been done with real-time data of projects from various published research papers. Thus, the model developed provided prediction of the percentage of the cost overrun based on the percentage input of the top five factors.

Inflation rate and labours’ wages in construction projects: economic relation investigation

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Ali Musarat ◽  
Wesam Salah Alaloul ◽  
M.S. Liew
Keyword(s):  
Construction Industry ◽  
Construction Projects ◽  
Inflation Rate ◽  
Vital Role ◽  
Strongly Correlated ◽  
Cost Overrun ◽  
Content Type ◽  
Spearman Correlation Test ◽  
Key Resources ◽  
The Impact

PurposeLabours are one of the key resources of construction projects having a significant impact on economic development. With time, the construction industry is getting a boom due to numerous construction projects in which labours’ contribution is significant. Project betterment is associated with the project productivity which relates to the labours. Wages play a vital role in retaining labours in the construction industry.Design/methodology/approachThis study focuses on investigating the increasing and decreasing behaviour of labour wages in the construction industry and observing the impact of the inflation rate in deviating labour wages. Initially, the percentage deviation was calculated to observe the changing behaviour of the data and then the Spearman correlation test was used to find the relationship between the inflation rate and the labour wages.FindingsIt is evident that even with a good economy and a stable construction sector, still, the labour wages faced a decline over time, which is a matter of concern. Also, based on the correlation coefficient, it was revealed that several labour wages categories are moderately and strongly correlated with the inflation rate and can impact project cost if the inflation rate is not considered while finalizing the budget. Besides that, the changing behaviour of labour wages due to the inflation rate impacts significantly on gross domestic product (GDP); therefore, it requires vital attention.Originality/valueChanges in labour wages are not considered in budget estimation which drag the project towards cost overrun. This study brings the attention of the stakeholders on the issue with experimental justification. Also, how the inflation rate is affecting the labour wages has also been addressed.

scholarly journals Influence of Claim Management in Construction Industry

2019 ◽  
Vol 9 (2S2) ◽  
pp. 1052-1061
Keyword(s):  
Construction Industry ◽  
Construction Projects ◽  
Negative Impact ◽  
Critical Issue ◽  
Point Of View ◽  
Cost Overrun ◽  
Construction Companies ◽  
Spss Software ◽  
The Impact ◽  
Work Contract

Most construction projects are suffering from claims due to many reasons. Claim emergencies have risen for ten years due to the critical political situation. These claims have a bad impact on all groups who were work in the construction field. The impact of claim could be followed to cost overrun, loss of efforts and suspension of work, contract termination. This investigation means to recognize the real reason for causes of claim in construction and demonstrate their difference between respondent concerning individual, company and organization traits. It also aims found the important factors in developing for the management of construction project claim to predict claim occurrence and to mitigate the negative impact of a claim. The objective of the study achieved through a valid questionnaire obtained from several construction companies. The questionnaire survey was conducted involving the contractor, consultant, client point of view. The result of the questionnaire encountered in the SPSS software for finding the major factor that affects the construction. The finding demonstrates the absence of site attention to detect claims, detachment or inaccessible of related documents proactively, and conflicts which develop during owner/contractor negotiation are all critical issue related with the system of claim management. My work aims to distinguish the various claims through review paper and to recognize the most impacted causes of claim in our region.

scholarly journals Impact of Delay on Cost Overrun in Construction Projects in Algeria

2019 ◽  
Vol 5 (2) ◽  
pp. 25
Author(s):  
Salhi Roumeissa
Keyword(s):  
Linear Regression ◽  
Construction Projects ◽  
Project Success ◽  
Regression Method ◽  
Linear Regression Method ◽  
Cost Overrun ◽  
Simple Linear Regression ◽  
Schedule Delay ◽  
Proposed Model ◽  
The Impact

Project success is the ultimate goal of the various project stackeholders (Salhi.R 2018). Asuccessful project means that the project is completed on time, within the agreed budget and according to the contract specifications. Delay is one of the most reccuring problems in construction project in Algeria, and it is considered as the main cause of cost overrun, time overrun, disput and claims.The objective of this paper is to mesure the impact of schedule delay on cost overrun, using the simple linear regression method and the coefficient of correlation. The proposed model can be used by practitioners as predictive mesure to address possible cost overrun.

scholarly journals Assessment of the Likelihood of Risk Occurrence on Tendering and Procurement of Construction Projects

2018 ◽  
Vol 2 (1) ◽  
pp. 20-32
Author(s):  
Oluwaseeun Dosumu
Keyword(s):  
Risk Management ◽  
Construction Projects ◽  
Risk Identification ◽  
The Body ◽  
Organizational Level ◽  
Cost Overrun ◽  
Response Level ◽  
Probability Of Occurrence ◽  
Management Techniques ◽  
The Impact

The construction industry is plagued by risks above other industries due to its unique features which include the complexity of building activities, extended period of construction, complicated processes, financial intensity and dynamic organisational structure. These risks are not adequately dealt with and result in increased cost, time and reduced quality. While many types of research have been conducted on construction risks, only a few types of research have investigated the impact of risk (at tendering and procurement stage) on construction projects before they commence. Meanwhile, risk issues are better solved at bidding and procurement phase than construction phase as the case has been. Therefore, this paper examines the likelihood, degree of impact and probability of risk occurrence on tendering and procurement of construction projects. It also investigates the significant sources of tendering and procurement risks, the level of awareness and adoption of risk management techniques in construction tendering and procurement.  The questionnaire for the study was administered on building contractors and consultants. A total of 44 questionnaires were retrieved and used for the analysis of the study. The statistical tools used for analysis are frequencies, percentages, mean scores and t test. The findings of the study revealed 17 significant sources of risk among the 35 that were investigated. Risks with high likelihood of occurrence, the degree of impact and high probability of occurrence were also indicated in the study. Based on the findings, it was concluded that respondents are aware and adopt risk management techniques on construction projects, but their adoption is at response level rather than identification level.  Therefore, the recommendation of the study is that awareness should be created on the need for risk identification before construction projects commence. This should be implemented at professional and organizational level. Construction stakeholders should guard against risks with a high degree of impact and probability of occurrence during tendering and procurement of construction projects.  Therefore, this study contributes to the body of knowledge by investigating the significant sources of risks to tendering and procurement, likelihood of risk occurrence, impact of risks and probability of risk occurrence in tendering and procurement. Keywords: Construction projects, Cost overrun, Impact of risk, Probability of risk, Procurement, Sources of risk, Tendering and procurement.

scholarly journals Design Changes in Construction Projects – Causes and Impact on the Cost

2019 ◽  
Vol 5 (7) ◽  
pp. 1647-1655 ◽  
Author(s):  
Mughees Aslam ◽  
Edmund Baffoe-Twum ◽  
Farhan Saleem
Keyword(s):  
Construction Projects ◽  
Primary Objective ◽  
Extensive Literature ◽  
Cost Overrun ◽  
Project Cost ◽  
Design Changes ◽  
Communication And Coordination ◽  
The Cost ◽  
The Impact ◽  
The Relationship

Isolation of design phase from construction has made the design changes inevitable in construction projects. Extensive literature appraisal has acknowledged the detrimental effect of design changes on project performances. However, the impact and causes of design changes have been divided up, either separately or project specific. As a result, the relationship between impact and causes of design changes could not be established for general construction. The primary objective of this paper is to examine the impact of design changes on project cost and identifying actions responsible for these changes. The objectives of the study were achieved through a systematic review of past literature published in well-established journals, and contents analyzed. From the extensive literature review, it was established that the design change is one of the predominant factors to cost overrun, and in some cases, may upshot into cost overrun between 5 and 40% of the project cost. Also, many causes of design changes resulting in cost overrun within the perspective of the owner, consultant, and contractors are explored. Some projects experienced closure as a result of owner induced design changes, although these changes may not be significant in number.  Design changes as a result of consultants and contractors in some cases might have reduced impact but are frequent. For each consideration, most events leading to design changes can be eliminated by improving on communication and coordination between stakeholders. The main contribution of this research is to bring together the impact and causes of design changes on cost under one platform for effectively managing the design process.

scholarly journals Cost overrun in construction projects in Oman: Case study

2021 ◽  
Vol 10 (3) ◽  
Author(s):  
Haitham Nasser Al Siyabi ◽  
Omar Khaleel
Keyword(s):  
Construction Industry ◽  
Construction Projects ◽  
Poor Quality ◽  
Building Construction ◽  
Cost Overrun ◽  
Survey Interviews ◽  
Original Contract ◽  
Major Factors ◽  
The Cost ◽  
The Impact

There are many challenges in construction industry sector, and one of the most important and critical is completion of the project within the original contract value. As the issue of cost overrun in construction projects is spread worldwide generally and commonly encountered in the Sultanate of Oman.The main objectives of this study are to identify and determine vital factors leading to cost overrun in Building Projects in Oman, evaluate the impact of cost overrun in building construction projects and develop the best protocol strategy for project management teams that can be adopted in order to control the cost overrun in future projects. These objectives have been obtained through several methods, questionnaire survey,interviews with experts in construction industry. Twenty nine major factors lead to cost overrun were identified through literature review and studied in Sultanate of Oman.The study concluded that there are three major impacts of cost overrun in construction projects and industry which are time of completion, delivery of poor quality projects and delay of payment approval. Additional to that, Hire good Supervision Team, a good Cost Controller, Project Manager, a good project design team, well planning for pre-contract stage and proper procurement strategy. Consider the Risk assessment and Risk Control are crucial to minimize the cost overrun in building construction project in Oman. The study have recommended procedure to cost control in future project such as the Employer should have a proper tender analysis of the Contractor’s bid, Detailed design should be finalized before award of work and others.

Impact of Utilizing Construction Engineering and Inspection Consultants on Highway Construction Project Cost and Schedule Performance

2019 ◽  
Vol 2673 (11) ◽  
pp. 716-725
Author(s):  
Ying Li ◽  
Sara Al-Haddad ◽  
Timothy R. B. Taylor ◽  
Paul M. Goodrum ◽  
Roy E. Sturgill
Keyword(s):  
Construction Projects ◽  
Highway Construction ◽  
Full Time ◽  
Cost Overrun ◽  
Full Time Equivalent ◽  
Agency Staff ◽  
Project Cost ◽  
Schedule Performance ◽  
Construction Project Cost ◽  
The Impact

State transportation agencies (STAs) are tasked with constructing and maintaining complex transportation networks while facing changes in agency construction staff with respect to age, experience level, turnover, retirement, and increasing levels of consulting services that are used to manage STA construction operations. To keep up with the increasing demands of projects, STAs are utilizing Construction and Engineering Inspection (CEI) consultants to fill the demand for construction-related human resources. However, the impact of using CEIs on project cost and schedule performance has not been quantified. The current work addresses this knowledge gap by analyzing a database of 305 completed highway construction projects across 16 STAs. The analysis found that projects that utilized CEI consultants had higher levels of full-time equivalent construction staffing than projects that utilized only agency staff. The use of CEI consultants had no impact on project cost compared with projects that relied solely on agency staff. Projects that used CEI consultants had an average cost overrun of 20.2% compared with agency-staffed projects, which experienced average schedule overruns of −7.7% (i.e., the project, on average, finished early). The schedule difference was statistically significant.

scholarly journals The Influence of Optimism Bias on Time and Cost on Construction Projects

2021 ◽  
Vol 5 (4) ◽  
pp. 429-442
Author(s):  
Aaron Chadee ◽  
Salisha R. Hernandez ◽  
Hector Martin
Keyword(s):  
Construction Projects ◽  
Management Practices ◽  
Time Window ◽  
Literature Survey ◽  
Control Mechanisms ◽  
Cost Overrun ◽  
Cost Overruns ◽  
Optimism Bias ◽  
Bias Score ◽  
The Impact

The unresolved scholarly debate to curtail cost and time performances in projects has led to alternate solutions, departing from the dominant technical school of thought to include concepts from behavioural sciences. In this paper, we consider the psychological effect, namely optimism bias, as one of the root causes for delays in cost overruns on projects. The research objectives were to determine the level of bias among project participants, rank time and cost overrun causes according to the participants’ bias score and establish a mitigation strategy to curb potential delays and cost overrun impacts based on the bias scores obtained. A literature survey was conducted to determine causal factors contributing to delays and cost overruns linked to optimism bias. Through a pilot survey of three semi-structured interviews, eighty factors obtained from the literature survey were reduced to 24 critical delay and cost overrun factors relevant to Trinidad and Tobago. A questionnaire was subsequently developed seeking construction professionals to rate their bias scores based on an 11-point Likert scale. The research confirms that project planners and decision-makers exhibit moderate levels of optimism bias; however, participants lacked awareness of the impact of optimism bias on projects outcomes. Project location, environmental impacts and historic preservation, and labour disputes are the top three critical factors where project professionals displayed increased optimistic tendencies. It is proposed that contingency “time window” and reference class forecasting be implemented as control mechanisms to mitigate the impacts of time and cost overruns on projects. This research introduces a novel method to account for and measure optimism bias on construction projects. This study adds knowledge into delays and cost overruns causation and provides a foundation for future studies on quantifying psychological effects on projects and enhancing overall project management practices. Doi: 10.28991/esj-2021-01287 Full Text: PDF

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