Preliminary study on causative factors leading to construction cost overrun
Cost is the fundamental component for any construction project. However, cost overrun is observed as one of the most frequently occurring issues in construction projects worldwide and need to be studied more to alleviate this issue in the future. This trend is more severe in developing countries whe...
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| Format: | Article |
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Penerbit Universiti Tun Hussein Onn Malaysia
2011
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| Online Access: | http://penerbit.uthm.edu.my/ojs/index.php/IJSCET http://penerbit.uthm.edu.my/ojs/index.php/IJSCET http://eprints.uthm.edu.my/2105/1/IJSCETv2n1p5.pdf |
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| Summary: | Cost is the fundamental component for any construction project. However, cost overrun is
observed as one of the most frequently occurring issues in construction projects
worldwide and need to be studied more to alleviate this issue in the future. This trend is
more severe in developing countries where these overruns sometimes exceeds 100% of
the anticipated cost of the project.
Like other countries, construction industry in Malaysia is also facing a lot of
challenges such as the delay to complete the project in time, the expenditure exceeding
the budget, the building defects and over dependent of foreign workers. The ultimate
effects of project delay also results in exceeding cost. This leads to serious need of
addressing the critical issue of construction cost overrun. To avoid construction cost
overrun, very first and most important step is to identify and understand the causes and
factors responsible for that. Hence, this paper is aimed to identify various factors
responsible for construction cost overrun. Through a comprehensive study of literature
review, common factors causing cost overrun resulting in identification of 78 factors were
mapped in frequency table. A questionnaire survey and interviews were carried out
amongst selected experienced personnel for expert opinion to identify the significant
factors causing cost overrun in Malaysia. Five respondents were selected from each of the
respondents groups including client, consultant and contractor. The questionnaire
responses were analyzed by average index method, which resulted in identification of 59
common factors causing construction cost overrun in Malaysia. Results show that poor
design & delays in Design, unrealistic contract duration & requirements imposed, lack of
experience, late delivery of materials & equipment, relationship between management &
labour, delay preparation & approval of drawings, inadequate planning & scheduling,
poor site management & supervision and mistakes during construction were most
common and significant factors causing cost overrun in Malaysian construction industry
as perceived by experts |
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