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Article
Publication date: 4 November 2019

Richard Ohene Asiedu and William Gyadu-Asiedu

This paper aims to focus on developing a baseline model for time overrun.

Abstract

Purpose

This paper aims to focus on developing a baseline model for time overrun.

Design/methodology/approach

Information on 321 completed construction projects used to assess the predictive performance of two statistical techniques, namely, multiple regression and the Bayesian approach.

Findings

The eventual results from the Bayesian Markov chain Monte Carlo model were observed to improve the predictive ability of the model compared with multiple linear regression. Besides the unique nuances peculiar with projects executed, the scope factors initial duration, gross floor area and number of storeys have been observed to be stable predictors of time overrun.

Originality/value

This current model contributes to improving the reliability of predicting time overruns.

Details

Journal of Engineering, Design and Technology , vol. 18 no. 3
Type: Research Article
ISSN: 1726-0531

Keywords

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Article
Publication date: 7 November 2016

Richard Ohene Asiedu, Nana Kena Frempong and Gabriel Nani

Time overruns are commonplace within the construction industry. These result in deception because project managers critically assess the economic and financial viability…

Abstract

Purpose

Time overruns are commonplace within the construction industry. These result in deception because project managers critically assess the economic and financial viability of a project before implementation. Forecasting the likelihood of time overruns will not only lead to a reconsideration on the decision to build but also help put in place the necessary control measures – exactly what this research achieved.

Design/methodology/approach

The paper argues that rather than depending on the critical failure factors that are unknown at the pre-contract stage to forecast the likelihood of occurrence, it will be more useful to rely on project attributes that are known before contract signing. A multiple linear regression analysis is used for the model development based on ten independent variables.

Findings

About 86.6 per cent of all the projects experienced time overruns. The mean time overrun is 106.5 per cent. Initial contract sum, initial duration, gross floor area, contractor class D2K2, competitive tendering, sole sourcing and single-storey buildings explained about 44.7 per cent of the variations within time overruns, with a mean absolute percentage error of 60.7 per cent.

Research limitations/implications

The predictive accuracy of the model can, in practice, be tested after the completion of a project by comparing the actual project schedule with the planned schedule. Any disparity in the expected outputs should result in a reassessment of the significant independent variables to improve the forecasting abilities of the model.

Practical implications

The model is expected to be very useful at the pre-contract stage when detailed designs are unavailable. As a decision support system, it will help the practitioners and decision-makers make informed decisions while minimizing the time and resources spent to arrive at these decisions.

Originality/value

This research presents a unique opportunity to forecast the likelihood of time overruns within the building sector based on project attributes that are known before the contract-signing phase.

Details

Journal of Financial Management of Property and Construction, vol. 21 no. 3
Type: Research Article
ISSN: 1366-4387

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Article
Publication date: 3 April 2017

Samuel Famiyeh, Charles Teye Amoatey, Ebenezer Adaku and Collins Sena Agbenohevi

In Ghana, the duration of construction projects from inception to completion is becoming a great concern, recently, especially among clients and beneficiaries, because of…

Abstract

Purpose

In Ghana, the duration of construction projects from inception to completion is becoming a great concern, recently, especially among clients and beneficiaries, because of the rising interest rates, inflation, development plan targets, among other factors. Hence the need to understand the causes of delays and cost overrun in the construction sector has become more important than ever. This study therefore aims to identify the major factors underlying time and cost overruns in projects related to the education sector in Ghana to proffer practical solutions in addressing them.

Design/methodology/approach

The study conducted a survey among clients’ consultants and representatives of the contractors working on about 60 government school projects. A relative importance index was used to determine the relative effects of the factors causing construction time and cost overruns.

Findings

The key factors causing construction time overrun were: financial problems, unrealistic contract durations imposed by clients, poorly defined project scope, client-initiated variations, under-estimation of project cost by consultants, poor inspection/supervision of projects by consultants. Other factors were underestimation of project complexity by contractors, poor site management, inappropriate construction methods used by contractors and delays in the issuance of permits by government agencies. Factors affecting cost overruns were financial difficulty by client, delays in payments of completed works, variations in designs, lack of communications plans, poor feasibility and project analysis, poor financial management on site and material price fluctuations.

Research limitations/implications

The research was limited to only the educational sector projects.

Practical implications

Practically, this study highlights for the construction sector the critical factors causing project time and cost overruns in Ghana. Identification of these factors provides the basis for pragmatic solutions to enhance the chances of project success.

Social implications

The identification and solutions to project time and cost overruns, especially for educational sector projects, contribute toward making public goods more affordable and accessible to most citizens, particularly in developing countries.

Originality/value

This study contributes to the debate on factors causing project time and cost overruns in the construction sector especially from a developing country’s perspective.

Details

Journal of Engineering, Design and Technology, vol. 15 no. 2
Type: Research Article
ISSN: 1726-0531

Keywords

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Book part
Publication date: 26 April 2017

Prince Boateng, Zhen Chen and Stephen O. Ogunlana

Abstract

Details

Megaproject Risk Analysis and Simulation
Type: Book
ISBN: 978-1-78635-830-1

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Article
Publication date: 15 May 2017

Abderisak Adam, Per-Erik Bertil Josephson and Göran Lindahl

The purpose of this paper is to explore the impact that cost overruns and time delays exert on large public construction projects to clarify how past and current research…

Abstract

Purpose

The purpose of this paper is to explore the impact that cost overruns and time delays exert on large public construction projects to clarify how past and current research regard factors causing cost overruns and time delays in large public construction projects.

Design/methodology/approach

This paper, which is based on an analysis of a literature selection consisting of 40 journal articles, investigates and ranks the occurrence of and the explanations for cost overruns and time delays in large public construction projects. The study makes use of a kiviat diagram/radar chart in order to visualize multivariate data.

Findings

Aggregated rankings of important causes of cost overruns and time delays are reported. These show a strong emphasis on the management aspect as a primary cause of cost overruns and delays. Additionally, there seems to be a trend toward deemphasizing the role of financial considerations in explaining cost overruns and delays. It is argued that there needs to be a more rigorous assessment of the impact that each factor has on cost increases and delays based on factual observed data as opposed to retrospective accounts from questionnaire respondents.

Research limitations/implications

Only public construction projects have been considered. The results will not be directly applicable to privately funded construction projects and/or projects of a smaller size.

Originality/value

The use of trend data, as illustrated in a kiviat diagram, showing how different ranking factors causing cost overruns and time delays has changed in importance over time.

Details

Engineering, Construction and Architectural Management, vol. 24 no. 3
Type: Research Article
ISSN: 0969-9988

Keywords

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Article
Publication date: 10 November 2020

Bertram I. Steininger, Martin Groth and Brigitte L. Weber

We investigate causes for the cost overrun and delay of the railway project Stuttgart 21. Besides, we try to forecast the actual costs and completion date at an early stage.

Abstract

Purpose

We investigate causes for the cost overrun and delay of the railway project Stuttgart 21. Besides, we try to forecast the actual costs and completion date at an early stage.

Design/methodology/approach

The results of exploratory research show the causes for the cost overrun and delay of Stuttgart 21; we compare our findings with other railway projects. To estimate the costs at an early stage, the reference class forecasting (RCF) model is applied; to estimate the time, we apply an OLS regression.

Findings

We find that the following causes are relevant for the cost overrun and delay of Stuttgart 21: scope changes, geological conditions, high risk-taking propensity, extended implementation, price overshoot, conflict of interests and lack of citizens' participation. The current estimated costs are within our 95% confidence interval based on RCF; our time forecast underestimates or substantially overestimates the duration actually required.

Research limitations/implications

A limitation of our approach is the low number of comparable projects which are available.

Practical implications

The use of hyperbolic function or stepwise exponential discount function can help to give a clearer picture of the costs and benefits. The straightforward use of the RFC for costs and OLS for time should motivate more decision-makers to estimate the actual costs and time which are necessary in the light of the rising demand for democratic participation amongst citizens.

Social implications

More realistic estimates can help to reduce the significant distortion at the beginning of infrastructure projects.

Originality/value

We are among the first who use the RCF to estimate the costs in Germany. Furthermore, the hyperbolic discounting function is added as a further theoretical explanation for cost underestimation.

Details

Journal of Property Investment & Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1463-578X

Keywords

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Article
Publication date: 2 February 2015

Zayyana Shehu, Gary D. Holt, Intan R Endut and Akintola Akintoye

Construction projects within Malaysia are plagued by time overruns that can transform what should have been successful projects, into those incurring additional costs…

Abstract

Purpose

Construction projects within Malaysia are plagued by time overruns that can transform what should have been successful projects, into those incurring additional costs, disagreements, litigation and in some cases abandonment. To help better understand this problem, the purpose of this paper is to investigate Malaysian project characteristics in relation to time overruns.

Design/methodology/approach

In total, 150 Malaysian quantity-surveying organisations provided data relating to recent projects they have worked on. Project characteristics considered in analysis are new build and refurbishment, public and private sectors, procurement methods used, nature of projects and tendering methods.

Findings

Public sector projects were found more prone to overruns than those in the private sector; refurbishment projects experienced better time performance than new build; construction management demonstrated better time performance than design-build or traditional procurement; and infrastructure projects/negotiated tendering, performed better than selective/open tendering, respectively. The study also developed a linear model to predict project duration, based on contract period.

Research limitations/implications

The study adds a geographically specific detailed analysis to the extant literature of project performance generally and to that of time overruns more specifically.

Practical implications

Findings provide stakeholders with information that may help mitigate the frequency of project delays among construction projects, especially in Malaysia.

Originality/value

The analysis and modelling of time overrun in relation to Malaysian project characteristics in this way is novel.

Details

Built Environment Project and Asset Management, vol. 5 no. 1
Type: Research Article
ISSN: 2044-124X

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Article
Publication date: 7 April 2014

Zayyana Shehu, Intan R. Endut and Akintola Akintoye

The delivery of construction projects in Malaysia is plagued by time overruns, which turns what should have been successful projects into those incurring additional costs…

Abstract

Purpose

The delivery of construction projects in Malaysia is plagued by time overruns, which turns what should have been successful projects into those incurring additional costs, or money-losing ventures; as well as leading to various other unexpected negative effects and faute de mieux situations. The purpose of this research is to assess those factors leading to time overrun in Malaysian construction projects. The perceptions of public and private sectors, contractors, clients, and consultants are compared relative to a list of factors derived from the review of extant literature in project delay.

Design/methodology/approach

The research data were collected through an industry-wide questionnaire survey circulated across the Malaysian construction industry. The research develops a list of 84 time overrun factors. Responses were collected from 49 clients, 51 contractors, and 105 consultants, to explore and analyse the major factors that are responsible for causing time overrun based on sectors (public and private), organisations (clients, contractors and consultants) and professional roles.

Findings

Project delays beyond contract dates are predominantly caused by contractors and are usually associated with financial factors. “Cash flow problems faced by the contractors” was found the major factor, which contributed to project delays, whereas “storage on site” was seen as the least significant factor.

Practical implications

It is noteworthy that the findings in this research have a regional focus; it is, therefore, suggested that readers from other sections of the world exercise caution in applying the findings. As it is believed that every construction industry has its nature, culture and regulations, these factors can change as a result of such differences.

Originality/value

This research provides stakeholders with information on factors, which, if properly understood, can make project delays less likely.

Details

Journal of Financial Management of Property and Construction, vol. 19 no. 1
Type: Research Article
ISSN: 1366-4387

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Article
Publication date: 18 September 2017

Ahmed Ebrahim Abu El-Maaty, Amr M. El-Kholy and Ahmed Yousry Akal

Modeling represents the art of translating problems from an application area into tractable mathematical formulations whose theoretical and numerical analysis provides…

Abstract

Purpose

Modeling represents the art of translating problems from an application area into tractable mathematical formulations whose theoretical and numerical analysis provides insight, answers and guidance useful for the originating application. The purpose of this paper is to determine the causal causes of schedule overrun and cost escalation of highway projects in Egypt in order to be used as independents variables in mathematical models for predicting the percentages of schedule overrun and cost escalation of such projects in Egypt.

Design/methodology/approach

A survey of a randomly selected samples yielded responses from 40 owners, 15 consultants and 56 contractors. The survey includes 38 schedule overrun factors and 26 cost escalation factors. The effectiveness degree of the identified factors has been identified by the triangle fuzzy approach.

Findings

The results of the survey show that “contractor’s technical staff is insufficient and ineligible to accomplish the project” is the most important cause of schedule overrun, while the major cause of cost escalation is inadequate preparation of the project concerning planning and execution.

Originality/value

The main contribution of this study is predicting the percentages of schedule overrun and cost escalation of highway projects in Egypt. Through the application of the linear regression analysis method and statistical fuzzy theory, four predictive models have been developed and it has been noted that the linear regression-based model shows prediction accuracy better than statistical fuzzy-based model in predicting percentages of schedule overrun and cost escalation.

Details

Engineering, Construction and Architectural Management, vol. 24 no. 5
Type: Research Article
ISSN: 0969-9988

Keywords

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Article
Publication date: 16 January 2017

Richard Ohene Asiedu, Nana Kena Frempong and Hans Wilhelm Alfen

Being able to predict the likelihood of a project to overrun its cost before the contract signing phase is crucial in developing the required mitigating measures to avert…

Abstract

Purpose

Being able to predict the likelihood of a project to overrun its cost before the contract signing phase is crucial in developing the required mitigating measures to avert it. Known parameters that permit the timely prediction of cost overrun provide the basis for such predictions. Therefore, the purpose of this paper is to develop a model for forecasting cost overruns.

Design/methodology/approach

Ten predictive variables known before the contract signing phase of a project are identified. Based on a survey approach, information on 321 educational projects completed are compiled. A multiple linear regression analysis is adopted for the model development.

Findings

Five variables – initial contract sum, gross floor area, number of storeys, source of funds and contractors’ financial classification are observed to influence cost overruns. The model, however, yields a fairly weak coefficient of determination with a mean absolute percentage error of 30.22 and 138 per cent, respectively.

Research limitations/implications

The model developed focussed on data only educational projects sampled from three out of the ten administration regions in Ghana based on a purposive sampling approach.

Practical implications

Policy makers and construction managers working on public projects stand to gain tremendous assistance in formulating and strengthening their own in-house cost forecasting at the precontract phase based on “what if” analysis to generate various alternative predictions of cost overruns.

Originality/value

Considering the innate nature of cost overruns within the Ghanaian construction industry often resulting to project abandonment, this research presents a unique dimension for tackling cost overruns based on a predictive approach.

Details

Engineering, Construction and Architectural Management, vol. 24 no. 1
Type: Research Article
ISSN: 0969-9988

Keywords

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