scholarly journals COVID-19 pandemic impact: an identification of the cause of cost overrun in construction project

2021 ◽  
Vol 331 ◽  
pp. 01014
Author(s):  
Yervi Hesna ◽  
Jati Sunaryati ◽  
Ayu Hidayati
Keyword(s):  
Construction Industry ◽  
Construction Project ◽  
Health And Safety ◽  
Cost Overrun ◽  
Project Cost ◽  
Heavy Equipment ◽  
Two Factors ◽  
Implementation Time ◽  
The Cost ◽  
The Impact

The paper provides a thorough examination of the impact of COVID-19 on increasing the cost of the construction project. The pandemic of COVID-19 had disrupted the financial and operational of the construction industry. Many projects have been closed and suspended, and this situation has caused great uncertainty in the construction industry. Even though the Instruction of the Minister of Public Work No. 2/2020 issued March 27, 2020, stated that construction activities in Indonesia could continue work. However, it still believes COVID-19 can lead to poor project cost performance. The study used a literature review to explore the factors contributing to the increase in project cost. A case study in the hotel construction project is used to test the factors. The research found six factors have a frequency of occurrence for each cause of cost overrun, namely labor, material, implementation time, project financial aspects, estimated cost, and occupational health and safety. The case study’s two factors are not the cause of the cost overrun based on the interviewee’s answer: heavy equipment and overhead. This paper also explains the mechanism to address cost overrun continue in construction work.

scholarly journals A BESPOKE APPROACH FOR RELATING MATERIAL WASTE TO COST OVERRUN IN THE CONSTRUCTION INDUSTRY

2017 ◽  
Vol 1 (1) ◽  
pp. 39-52
Author(s):  
Ibrahim Saidu ◽  
W Shakantu ◽  
A Adamu ◽  
I Anugwo
Keyword(s):  
Construction Industry ◽  
Construction Material ◽  
Methodological Approach ◽  
Construction Project ◽  
Project Managers ◽  
Cost Overrun ◽  
Project Cost ◽  
Cost Overruns ◽  
Project Completion ◽  
Final Project

The problems of material waste and cost overruns are common in the construction industry. These problems occur at different stages of a construction project, from planning, design to project completion. The argument on how to eliminate cost overrun has been on-going for the past 70 years as on-site wastage of materials leads to increase in the final project cost. This paper examines the relationship between the causes of material waste and those of cost overrun at the pre-contract and post-contract stages of a project. The desktop methodological approach was firstly adopted in comparing the causes of material waste and those of cost overruns from the literature, in order to determine the possible relationship. Subsequently, interviews were purposively conducted with construction professionals within Abuja, Nigeria, in order to verify the literature based information. The result reveals that all the causes of material waste also cause cost overrun at the pre-contract and the post-contract stages of a project. 96.88% and 81.81% of the causes of cost overrun also cause material waste at the pre-contract and post-contract stages respectively. Other causes which are not related are mostly, the micro-economic and macro-economic factors. These results are not different from those of the interviews conducted with professionals and summarised in the tick box. It was also found that to achieve Effective Construction Material Waste Management (ECMWM) for any construction project, material waste must be controlled at its sources and causes, and at different stages of a project. Based on these findings, it can be concluded that effective management of material waste would translate into a reduction in the level of project cost overrun. The study recommends that construction-project managers, as well as the construction practitioners should encourage the management of material-waste causes, as it has the potential to minimise cost overrun for projects. 

Impact of COVID-19 on project performance in the UAE construction industry

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Sami Ur Rehman ◽  
Muhammad Tariq Shafiq ◽  
Muneeb Afzal
Keyword(s):  
Construction Industry ◽  
Construction Projects ◽  
Construction Project ◽  
Health And Safety ◽  
Project Performance ◽  
Content Type ◽  
Government Institutions ◽  
Depth Analysis ◽  
The Government ◽  
The Impact

Purpose The coronavirus disease 2019 (COVID-19) pandemic has affected the global economy and, thus, the global construction industry. This paper aims to study the impact of COVID-19 on construction project performance in the United Arab Emirates (UAE). Design/methodology/approach This study adopted a qualitative and exploratory approach to investigate the impact of COVID-19 and its policies on project performance in the UAE construction industry in critical areas of the project management body of knowledge (e.g. schedule, cost, resources and contracts). Semi-structured interview questions were asked from ten construction professional to obtain valuable insights into the pandemic’s effects on the UAE construction industry and the effectiveness of policies implemented to rectify the damage and identify the industry’s new normal. Findings The findings indicate that the construction industry faced several challenges such as schedule delays, disrupted cashflows, delayed permits, approvals and inspections, travel restrictions, serious health and safety concerns, material and equipment shortages, among others which hindered the timely delivery of construction projects. It also indicates that efforts made by the government institutions and the construction industry of the UAE such as economic support programs, digitization of processes, fee and fine waivers, health facilities, among other statutory relaxations proved effective in supporting the construction industry against the adverse effects of the pandemic. Research limitations/implications The research findings are limited to the literature review and ten semi-structured interviews seeking an expert’s opinion from industry professionals working in the UAE construction industry. The research team did not get access to project documents, contracts and project progress reports which may be required to validate the interview findings, and to perform an in-depth analysis quantifying the impact of COVID 19 on construction projects performance, which is a limitation of this research. Practical implications The implication is that, owing to the imposed lockdowns and strict precautionary measures to curb the rapid spread of the pandemic, smooth execution of the construction project across the country was affected. The government institutions and stakeholders of the construction projects introduced and implemented various techniques and solutions which effectively handled the implications of the COVID-19 pandemic on the construction industry of the UAE. Originality/value This study has identified the challenges faced by the construction industry of the UAE in the context of the management of project schedule, project cost, construction contracts, health and safety of construction employees and other related aspects of the construction projects. This study also identified the techniques and solutions adopted by various public and private institutions of the country and their implications on construction projects. Therefore, this study provides guidelines for policymakers and future research studies alike.

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.

scholarly journals Analysis Of The Impact Of The Covid-19 Pandemic On The Construction Industry Sector

Neutron ◽  
2022 ◽  
Vol 21 (2) ◽  
pp. 52-59
Author(s):  
Liliana Hannes ◽  
Julistyana Tistogondo
Keyword(s):  
Construction Industry ◽  
Construction Projects ◽  
Construction Project ◽  
Construction Materials ◽  
Industry Sector ◽  
Independent Variable ◽  
The Cost ◽  
The Impact ◽  
Cost Aspect

Accelerating infrastructure development in Indonesia is a good thing, but this is not without problems. The COVID-19 pandemic is a problem that has a large and global impact, not least in Indonesia, especially in the construction industry sector. The construction project of the Soedono Madiun Hospital is one of the construction projects that have experienced the direct impact of the COVID-19 pandemic. Therefore, the purpose of this study is to review and analyze the impact of the covid-19 pandemic on construction projects in the case study of the construction project of the Soedono Madiun Hospital, and to find out the biggest impact of the covid-19 pandemic which has the most influence on construction projects in the case study of the construction project of the Soedono Hospital. Madison. The research method used to determine the biggest impact of the covid-19 pandemic on the cost and time aspects is the multiple linear regression analysis method with the help of Microsoft Excel. The other data analysis methods used in this study were the validity and reliability tests used in testing the questionnaire. The results of data analysis conducted in this study indicate that there are seven independent variables affect the dependent variable, namely the suitability of planning and project realization with the equation y= 94.186-0.376x1-0.108x2-1.014x3+0.873x4 for the time aspect, and the equation y=87,009 -0.0006x5-0.001x6-0.0002x7 for the cost aspect. With this equation, it can be seen that the independent variable that has the most influence on the dependent variable on the time aspect is the independent variable X3, namely the change in the time schedule due to delays in the arrival of construction materials by 1.014, while in the cost aspect is the independent variable X6, namely changes in costs due to instability. the price of construction materials is 0.001. So, it is hoped that there will be a project management handling that focuses on the most influential variable, namely construction materials.

ECONOMIC SUBSTANTIATION OF TRANSITION TO PERSONNEL OUTSOURCING IN THE ORGANIZATIONS OF THE CONSTRUCTION INDUSTRY

2020 ◽  
pp. 70-79
Author(s):  
V.V. Verna
Keyword(s):  
Cost Effectiveness ◽  
Construction Industry ◽  
Methodological Approaches ◽  
Construction Organization ◽  
The Cost ◽  
The Impact

The article provides a rationale for methodological approaches to assessing the effectiveness of outsourcing in organizations of the construction industry using the example of outsourcing schemes to perform personnel functions. The conditional example shows the impact of the use of outsourcing on reducing the costs of a construction organization. The main prerequisites for the use of outsourcing in the activities of enterprises in the construction industry are identified, methodological approaches to assessing the cost-effectiveness of personnel outsourcing in the construction industry enterprises are substantiated.

Analysis on the Problems and Measures to the Construction Project Cost Management

2014 ◽  
Vol 971-973 ◽  
pp. 2458-2461
Author(s):  
Zhao Xia Ma ◽  
Guang Cai Yan
Keyword(s):  
Cost Management ◽  
Construction Project ◽  
Project Cost ◽  
Technology Application ◽  
The People ◽  
Management Concept ◽  
Construction Project Cost ◽  
Existent Problem ◽  
The Cost ◽  
Information Technology Application

To survive and prosper in a more competitive construction market nowadays, a company must strengthen the cost management of construction project. This paper expounds the present situation of the construction project cost management, existent problem in the process of the construction project cost management. Countermeasure analysis of perfecting the construction project cost management is discussed in respect to the management concept and method, information technology application, the people-oriented and sustainable concept of development.

Study on the Relationships of the Construction Technology and the Cost Management Based on Enterprise Quota

2014 ◽  
Vol 543-547 ◽  
pp. 4040-4043
Author(s):  
Wen Zhang ◽  
Li Juan Zhang
Keyword(s):  
Cost Management ◽  
Value Engineering ◽  
Construction Technology ◽  
Project Cost ◽  
The Cost ◽  
The Impact

Enterprise quota is the foundation of project cost management. With the appearance of advanced construction technology, enterprise quota should be constantly updated and improved, so as to improve the level of enterprise cost management. This paper studies the impact of construction technology on cost management based on enterprise quota,and then demonstrated by the Value Engineering. From that, we know the advanced construction technology can help enterprise save the cost and improve the economical benefits.

scholarly journals Integrated model for the stressors, stress, stress-coping behaviour of construction project managers in the UK

2018 ◽  
Vol 11 (3) ◽  
pp. 761-782 ◽  
Author(s):  
Shamil George Naoum ◽  
Carlos Herrero ◽  
Charles Egbu ◽  
Daniel Fong
Keyword(s):  
Construction Industry ◽  
Structural Equation Modelling ◽  
Structural Equation ◽  
Construction Project ◽  
Project Managers ◽  
Stress Coping ◽  
Content Type ◽  
Equation Modelling ◽  
And Performance ◽  
The Impact

Purpose It is axiomatic that construction is a fast-paced and competitive industry, which goes hand in hand with many construction professionals suffering from stress including construction project managers (C-PMs). The role of C-PMs is crucial to achieving project success as they are responsible for planning the project, organising human resources, controlling operations and the budget, and forecasting probable difficulties. The purpose of this paper is to investigate the causal relationships between stressors, stresses, stress-coping behaviours and their impact on the performance of C-PMs. Design/methodology/approach To investigate the relationships between stress and performance among C-PMs, a questionnaire was designed based on the extensive literature, and was sent to 150 C-PMs who had amassed at least five years’ direct working experience in the construction industry. A total of 44 completed questionnaires were returned. Correlation analysis and structural equation modelling were employed to understand the integrated relationships between these factors. Based on the data collected and analysis of the results, an integrated structural equation model of the stresses and performances of C-PMs was developed using AMOS version 22.0. Findings The results of structural equation modelling reveal the following: burnout is the type of stress that has the highest impact on the performance of C-PMs, being detrimental to their interpersonal performance (IPP) and positive for their organisational performance (OP), whereas physiological stress worsens the task performance of C-PMs and objective stress improves their IPP. The most active stressor towards the performance of C-PMs is “workgroup cooperation”, which has an impact on the IPP in a positive way but is detrimental to the OP. Career-developing environment, poor organisational structure and role conflict affect both stress and performance together. Originality/value This study provides a comprehensive investigation into the impact of various types of stress on the performances of C-PMs. The result constitutes a significant step towards the stress management of C-PMs in the dynamic and stressful construction industry.

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