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Application of treemaps to the analysis of competitively bid project cost overruns

T.P. Williams (Department of Civil and Environmental Engineering, Rutgers University, Piscataway, New Jersey, USA)

Construction Innovation

ISSN: 1471-4175

Article publication date: 16 October 2007

933

Abstract

Purpose

Competitively bid construction projects are often completed for amounts greater than the original low‐bid amount. Improved methods of predicting a projects potential to experience large cost overruns would be useful to government agencies for planning capital budgets. The purpose of this paper is to explore the application of treesmaps to the analysis of competitively bid project cost overruns.

Design/methodology/approach

In this research a data visualization technique called treemaps was explored as a method of describing the nature of the bids for highway construction projects, and as a method of relating the characteristics of a projects bids to the observed increase in completed project cost. Ratios were calculated that measured bid characteristics for projects from Texas and California. Treemaps were constructed that related the level of the bidding ratios to the level of the difference between the completed project and the original low‐bid amount

Findings

It was found that the treemaps indicated that projects with high‐ratio values typically experienced a larger weighted average percentage difference between the low bid and completed project cost than projects with low ratio values.

Research limitations/implications

Future research should include consideration of other project factors in the treemaps, and testing of the treemaps to determine their usefulness to practitioners.

Practical implications

Treemaps present a way of understanding complex relationships between construction bidding data and the cost increases that occur during construction without the need to construct complex mathematical models.

Originality/value

The paper shows that bidding ratios can be used as indicators of a projects potential for cost overruns. The paper presents a new way of visualizing the construction bidding ratio data.

Keywords

Citation

Williams, T.P. (2007), "Application of treemaps to the analysis of competitively bid project cost overruns", Construction Innovation, Vol. 7 No. 4, pp. 340-356. https://doi.org/10.1108/14714170710780093

Publisher

:

Emerald Group Publishing Limited

Copyright © 2007, Emerald Group Publishing Limited

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