Modeling cost overrun in building construction projects using the interpretive structural modeling approach: a developing country perspective
Engineering, Construction and Architectural Management
ISSN: 0969-9988
Article publication date: 30 December 2021
Issue publication date: 14 March 2023
Abstract
Purpose
Although several studies have been conducted on the causes of cost overrun, they have mainly assumed that the causes of cost overrun are independent of each other, and few of them scrutinized the complex interrelationships between the causes. To fill the gap, this study aims to investigate the mutual interactions between the causes of cost overrun using interpretive structural modeling (ISM) and proposing strategies to tackle the causes considering their interactions.
Design/methodology/approach
Critical causes of cost overrun were identified through a comprehensive literature review. In total, 22 key causes are then refined based on the opinions of relevant experts involved in the Iranian building and construction sector. Using the nominal group technique, the causes' interactions were examined and represented via the ISM diagram. The causes were also classified using “matrix cross-reference multiplication applied to a classification (MICMAC)” technique.
Findings
The results showed that price fluctuation, claims, execution delay, delay in payment and change order positioned at the highest level of the obtained model can directly result in cost overrun, and corruption and poor contract management located at the base of the model are two major root causes of cost overruns. It was also concluded that more attention should be paid to the precontract phase of the project to address and prevent corruption and managerial issues deeply rooted in this stage.
Originality/value
The findings of this study provide a clear understanding of how different causes of cost overrun are related to each other and can ultimately assist project managers of different parties in choosing strategies to mitigate cost overrun in building construction projects.
Keywords
Acknowledgements
Conflict of interest statement: Authors declare no conflict of interest.
Citation
Shoar, S., Yiu, T.W., Payan, S. and Parchamijalal, M. (2023), "Modeling cost overrun in building construction projects using the interpretive structural modeling approach: a developing country perspective", Engineering, Construction and Architectural Management, Vol. 30 No. 2, pp. 365-392. https://doi.org/10.1108/ECAM-08-2021-0732
Publisher
:Emerald Publishing Limited
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