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Article
Publication date: 25 July 2008

Olubola Babalola and David Abiodun Adesanya

Electrical services contribute a substantial percentage of total construction cost of any particular project. It is essential for estimators to have a detailed knowledge…

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968

Abstract

Purpose

Electrical services contribute a substantial percentage of total construction cost of any particular project. It is essential for estimators to have a detailed knowledge of the factors that affect the incorporation of electrical services cost into the overall building project cost. The overall aim of the study that formed the basis for this paper therefore was to investigate the factors that influence cost estimating of electrical services project.

Design/methodology/approach

The study was carried out based on questionnaire survey of 225 organizations that are involved in cost estimating of electrical services projects in Nigeria. A total of 158 questionnaires out of the 163 retrieved were appropriate for analysis. A list of factors potentially influencing cost estimate for electrical services was identified for the respondents to rate. The data collected were analyzed using factor analysis based on principal component analysis and varimax orthogonal rotation.

Findings

The results shows that the factors affecting production of cost estimate for electrical services could be grouped into four principal factors: the most important factor grouping being estimator competence followed by project technicality, economic requirements and contract requirements.

Practical implications

Many factors are considered by practitioners in the preparation of cost estimate for electrical work in construction project development. The paper has listed about 23 factors that are relevant. However, this paper has shown that four principal factors need to be considered as they explain 64 percent of the factors affect cost estimate production for building project's electrical service works.

Originality/value

Review of literature has shown that there is limited empirical research on the factors influencing cost estimate production for electrical services work. The paper has produced an empirical research on the crucial factors that must be taken into account when producing cost estimate for the electrical service projects.

Details

Journal of Financial Management of Property and Construction, vol. 13 no. 3
Type: Research Article
ISSN: 1366-4387

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Article
Publication date: 10 May 2021

Adekunle Sabitu Oyegoke, Robert Powell, Saheed Ajayi, Godawatte Arachchige Gimhan Rathnagee Godawatte and Temidayo Akenroye

This paper aims to identify and analyse the factors affecting the selection of effective cost control techniques in the UK construction industry and assess their…

Abstract

Purpose

This paper aims to identify and analyse the factors affecting the selection of effective cost control techniques in the UK construction industry and assess their importance. The study examines these key areas; the factors that have significant impacts on cost overruns, the most effective cost control techniques and the factors for selecting cost control techniques for a project.

Design/methodology/approach

The study relies on a mixed-method research approach; a qualitative exploration of the most effective cost control techniques and the factors affecting the selection of cost control techniques, followed by a questionnaire survey and follow-up interviews. Relative importance index (RII) is used for ranking the factors.

Findings

The budgeting technique is ranked first with-0.821RII, followed by cost forecasting-0.800RII and cashflow monitoring-00.733RII, as the most effective cost control techniques. On factors that influenced the choice of the techniques used, cost information/cost-related factors are ranked first with-0.611RII, followed by the size of the company-0.509RII and the effectiveness of the technique-0.572RII.

Research limitations/implications

Although the scope of the study was limited to the UK construction industry, the results could be interpreted for critical learning in other developed/developing countries.

Originality/value

Identifying and ranking the factors affecting the selection of effective cost control techniques in the UK construction industry has been the focal point of this study. The study also proposes a simple but effective model which can be used for critical learning on mitigating cost overruns and the effective use of cost control techniques in the construction industry.

Details

Journal of Financial Management of Property and Construction , vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1366-4387

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Article
Publication date: 25 January 2021

Lovelin Ifeoma Obi, Mohammed Arif, Bankole Awuzie, Rubina Islam, Aman Deep Gupta and Robert Walton

Effective cost performance is a crucial criterion measuring successful project management in public-housing projects. This paper aims to analyse the vital underlying…

Abstract

Purpose

Effective cost performance is a crucial criterion measuring successful project management in public-housing projects. This paper aims to analyse the vital underlying factors surrounding the successful cost management process (CMP) outcomes in public housing projects (PHPs).

Design/methodology/approach

The research was conducted in three stages. The first stage consisted of a detailed literature review to document success factors affecting cost performances and management. In stage two, brainstorming sessions were undertaken with construction experts knowledgeable in cost management practices and have been involved in PHPs. These sessions were used to refine those success factors for the PHPs settings and define their criticality with respect to the CMP stages using interpretive ranking process. In stage three, focus group sessions were performed to validate the interrelationships of the contextualised critical success factors.

Findings

The top three most critical factors for successful implementation and outcomes at all CMP stages in PHPs settings were found to relate to competencies, team qualities and collaborative practices of the project team. Early contractor involvement and effective construction planning and management also emerged relevant to the process.

Practical implications

Government project departments, project managers and construction organisations (consultants and contractors) need to commit and mandate continuous development of cost management competencies for all professionals engaged in PHPs. Channels supporting team integration and collaborative practices between design and construction teams are required to increase the likelihood of successful project cost management practice and outcomes in PHPs.

Originality/value

The research has developed a factor-process relationship model that can be used to improve and evaluate the efficacy of CMP implementation in PHP settings.

Details

Construction Innovation , vol. 21 no. 4
Type: Research Article
ISSN: 1471-4175

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Article
Publication date: 1 December 2003

Jie Lu and Guangquan Zhang

This paper first presents a research framework for e‐service evaluation within four categories: cost, benefit, functions and development, each incorporating a number of…

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4235

Abstract

This paper first presents a research framework for e‐service evaluation within four categories: cost, benefit, functions and development, each incorporating a number of factors. Through data analysis and hypotheses testing, inter‐relationships among the factors of the four categories are examined. The results show that the development type of an e‐service has a significant effect on the degree of user satisfaction. Expertise, technique and expense are the principle factors limiting current e‐service adoption. The most significant finding is that, in the development of e‐services, certain cost factors are significantly more important than others in relation to certain benefit factors. The finding is presented as a cost‐benefit factor‐relation model. This provides an insight into whether investment in certain areas of e‐service applications is more important than in others for particular business objectives. These results have the potential to improve the strategic planning of companies by determining more effective investment areas and adopting more suitable development activities where e‐services are concerned.

Details

International Journal of Service Industry Management, vol. 14 no. 5
Type: Research Article
ISSN: 0956-4233

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Article
Publication date: 1 February 1988

Overview All organisations are, in one sense or another, involved in operations; an activity implying transformation or transfer. The major portion of the body of…

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2829

Abstract

Overview All organisations are, in one sense or another, involved in operations; an activity implying transformation or transfer. The major portion of the body of knowledge concerning operations relates to production in manufacturing industry but, increasingly, similar problems are to be found confronting managers in service industry. It is only in the last decade or so that new technology, involving, in particular, the computer, has encouraged an integrated view to be taken of the total business. This has led to greater recognition being given to the strategic potential of the operations function. In order to provide greater insight into operations a number of classifications have been proposed. One of these, which places operations into categories termed factory, job shop, mass service and professional service, is examined. The elements of operations management are introduced under the headings of product, plant, process, procedures and people.

Details

Management Decision, vol. 26 no. 2
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 12 September 2016

Chiara Paltriccia and Lorenzo Tiacci

The purpose of this paper is to present a new outsourcing model for materials management related to the operating theatre of hospitals. Two distinguishing features…

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1345

Abstract

Purpose

The purpose of this paper is to present a new outsourcing model for materials management related to the operating theatre of hospitals. Two distinguishing features characterize the model: the long-term collaborative network established among the supplying companies (the “Network factor”), and the implementation of the RFID technology along the supply chain (the “RFID factor”). The network factor allows sharing transportation costs, while the RFID factor allows implementing a continuous review policy, instead of the periodic review policy normally utilized in hospitals. In the paper the effect of these two factors on the minimization of total materials management costs is investigated.

Design/methodology/approach

An analytical model, validated through a simulation study, is proposed to calculate total management costs of materials, depending on the presence of the network and the RFID factors. Throughout the model it is possible to perform a scenario analysis and individuate the inventory management policy that allows minimizing total costs. The procedure has been applied to a real case study of a long-term collaborative network of supplying companies in the healthcare sector that operates in Central Italy.

Findings

The optimal inventory management policy strongly depends on the mutual distances of supplying companies and the hospital. Both of the two factors have an impact on the reduction of total annual costs. The analysis of the scenario shows that a positive interaction effect exists between the two factors, so that higher savings are obtained when both factors are present.

Originality/value

The outsourcing model presented in the paper is new, and the managerial insights that can be drawn from the application of the model to the healthcare sector can be extended to many other industries.

Details

Industrial Management & Data Systems, vol. 116 no. 8
Type: Research Article
ISSN: 0263-5577

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Article
Publication date: 28 November 2019

Tala Hassan Dandan, Ghaleb Sweis, Lilana Salem Sukkari and Rateb J. Sweis

The purpose of this paper is to identify factors affecting cost estimate accuracy in each of five design stages preceding building construction: order of magnitude…

Abstract

Purpose

The purpose of this paper is to identify factors affecting cost estimate accuracy in each of five design stages preceding building construction: order of magnitude, conceptual/schematic, detailed design, construction document and bid phase.

Design/methodology/approach

Data were collected using an online survey completed by 138 respondents who work in design consultancy firms in Jordan, including project managers, architects and quantity surveyors (QSs). Survey responses were analyzed using descriptive statistics. Confirmatory interviews and case study comparisons were used to confirm the statistical analysis results.

Findings

The results of this study indicated that each design stage’s cost estimate was affected by several factors. Two significant factors were common across four of the five design stages: client experience and project team experience. In addition, a high level of agreement was observed among the project managers, architects and QSs regarding the factors affecting cost estimate accuracy.

Originality/value

Accurately estimating building construction costs during the design process has posed a challenge for designers and their clients in Jordan. Despite the care and effort involved in preparing cost estimates in each of the five design stages, deviations are commonly observed. Because the accuracy of building construction cost estimates directly affect the success or failure of a project, the results of this study can be used to reduce uncertainties in building construction cost estimation and subsequently increase the likelihood of project success

Details

Journal of Engineering, Design and Technology , vol. 18 no. 4
Type: Research Article
ISSN: 1726-0531

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Article
Publication date: 3 September 2021

Wennan Zhang, Kai Kang and Ray Y. Zhong

This paper proposes an evaluation model for prefabricated construction to guide a supply chain with controllable costs. Prefabricated construction is prevalent due to area…

Abstract

Purpose

This paper proposes an evaluation model for prefabricated construction to guide a supply chain with controllable costs. Prefabricated construction is prevalent due to area limitations. Nevertheless, the development is limited by budget control and identifying the factors affecting cost. The degree of close collaboration in the supply chain is closely interconnected with cost performance that includes direct and indirect factors. This paper not only quantizes these factors but also distinguishes the degree of influence of various factors.

Design/methodology/approach

System dynamics is applied to simulate and analyze the construction cost factors through Vensim software. It can also clarify the relationship between cost and other influencing factors. The input data are collected from an Internet of Things (IoT)-enabled system under a Building Information Modeling (BIM) system and Hong Kong government reports.

Findings

Simulation results indicate that prefabricated construction cost is mainly influenced by government promotion degree (GPD), working pressure from on-site construction (WPOSC), prefab quality (PQ), load-bearing capacity per vehicle (LBPV) and mold quality (MQ). However, it is more sensitive toward GPD, which indicates that the government should take measures to promote this construction technology. On-site worker management is also essential for the assembly process and indirectly influences the construction cost.

Research limitations/implications

This paper quantifies indirect influential factors to clarify the specific features for prefabricated construction. The investigated factors are limited.

Practical implications

The contractor can identify all factors and classify the levels of influence to make decisions under the supply chain system boundary.

Social implications

The input data are collected from an IoT-enabled system under a BIM system and Hong Kong government reports. Thus, the relationship between construction cost influential factors can be investigated.

Originality/value

This paper quantifies indirect influencing factors and clarifies the specific features in prefabricated construction. The contractor could identify these factors to make decisions and classify the levels of influence under the supply chain system boundary.

Details

Industrial Management & Data Systems, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0263-5577

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Article
Publication date: 17 June 2020

Johnson Adafin, James O.B. Rotimi and Suzanne Wilkinson

There has been a lack of research, particularly within the New Zealand (NZ) context, focusing on the identification and assessment of risk factors for construction…

Abstract

Purpose

There has been a lack of research, particularly within the New Zealand (NZ) context, focusing on the identification and assessment of risk factors for construction projects, leading to a wide variation between design-phase elemental cost plans (ECPs) and the outturn tender sums (OTS). Still to be investigated is how risks interact to produce such variability. This study aims to determine the risk-influencing factors, identified through risk measurement, during design development.

Design/methodology/approach

This study adopted literature review and online questionnaire survey. The literature review was used to identify the factors affecting project budgetary performance, which was used to design the questionnaire survey culminating in data analysis. The questionnaire was administered to 64 practising project managers (PMs) in NZ. Their responses were analysed using descriptive statistics, mean ranking analysis, degree-of-risk measure and correlational analysis, to find the top-five risk factors impacting the variability observed, through ranking the mean and degree of risk values that produce such variability.

Findings

Significant risk factors were identified from the questionnaire survey analysis, such as changes in project owner/stakeholder requirements, experience of project team, site condition information, competency of consultants and information flow and quality. These provided some insights in explaining the variability between the design-phase ECPs and OTS based on risk impacts from PMs’ viewpoints.

Research limitations/implications

Findings revealed a drift of 23.86% in budgeted costs (inflated risks), which seems significant. Prioritising top risk factors may provide handy information for researchers on the variables that could be relied upon for the development of a forecasting model for application in NZ.

Practical implications

The study findings have implications for PMs seeking to provide information on mitigation strategies by using risk management approach, considering the influence of development risks on building project delivery and, consequently the project owner’s financial position. To guard against wide variation between design-phase ECPs and OTS, the main contribution of this study is to raise consultants’ awareness of the important risk factors for their planning at the outset, thus assisting PMs in pro-actively managing their clients' budgets.

Originality/value

This study creates value by synthesising literature on construction project budgeting and highlighting areas for further research. By giving adequate attention to key risks associated with budget overruns in commercial projects, variability between ECPs and OTS, a common phenomenon in NZ, can be controlled to achieve cost savings. Based on this, further study suggests the development of a model that could assist the stakeholders in NZ to more reliably predict OTS from the design-phase ECP and pro-actively avoid unfortunate budget/cost overruns, disputes and even project abandonment.

Details

Journal of Engineering, Design and Technology , vol. 19 no. 1
Type: Research Article
ISSN: 1726-0531

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Article
Publication date: 20 April 2010

H.K. Gichunge, S.M. Masu and O.A. K'Akumu

The purpose of this paper is to look at the applications of factor cost indices in the building industry in Nairobi, Kenya against the possibilities established through a…

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656

Abstract

Purpose

The purpose of this paper is to look at the applications of factor cost indices in the building industry in Nairobi, Kenya against the possibilities established through a review of the principles so as to establish the extent of use in practical situations in the industry. There are two organisations involved in compilation of factor cost indices in Kenya – Central Bureau of Statistics and Joint Building Council (JBC). Their practices for compilation of factor cost indices are reported in this paper.

Design/methodology/approach

The paper reviews the principles of factor cost index in order to establish a conceptual framework within which practices are then evaluated. The statistical bureau's compilation of building cost indices and the instructions by the JBC are considered as available evidence of application.

Findings

The paper finds that the application of factor cost index in Kenya is limited, a situation that therefore demands more research by the construction industry in Kenya.

Originality/value

The research's originality lies in its supportive evaluation of the application of the indicator concept in the building industry. More applications would imply greater possibilities for research and development within the case study industry.

Details

Journal of Financial Management of Property and Construction, vol. 15 no. 1
Type: Research Article
ISSN: 1366-4387

Keywords

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