Cost Overruns and Delay in Municipal Construction Projects in Developing Countries

Heravi, G.; Mohammadian, M.

doi:10.22060/ceej.2017.12189.5163

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	Cost Overruns and Delay in Municipal Construction Projects in Developing Countries
Article 4, Volume 1, Issue 1, Winter and Spring 2017, Page 31-38 PDF (4300 K)
Document Type: Research Article
DOI: 10.22060/ceej.2017.12189.5163
Authors
G. Heravi^* ; M. Mohammadian
School of Civil Engineering, College of Engineering, University of Tehran, Tehran, Iran
Abstract
Cost overruns and delay are common issues in the construction industry of developing and developed countries. In this article, compared with construction projects in other developing countries, the common causes of the cost overruns and delay in delivering municipal construction projects are discussed. This case study considers municipal construction projects in the city of Karaj, as one of the fastest developing cities in Iran. To meet the objectives of this research, 72 different types of urban roads and building projects are considered. This study shows that small-budget and short-term municipal projects, generally, experience higher cost and time performance. This paper contributes to the construction project management body of knowledge by a comprehensive analysis of cost overruns and delays in delivering municipal construction projects in developing countries. The findings of this study may be used by municipalities, for the realistic strategic planning of their construction projects, especially in developing countries.
Highlights
[1] Y.-M. Cheng; “An exploration into cost-influencing factors on construction projects,” International Journal of Project Management, Vol. 32, No. 5, pp. 850-860, 2014. [2] Z. Shehu, I.R. Endut, A. Akintoye, G.D. Holt; “Cost overrun in the Malaysian construction industry projects: A deeper insight,” International Journal of Project Management, Vol. 32, No. 8, pp. 1471-1480, 2014. [3] G.J. Sweis, R. Sweis, M.A. Rumman, R.A. Hussein, S.E. Dahiya; “Cost overruns in public construction projects: the case of Jordan,” Journal of American Science, Vol. 9, No. 7, pp. 134-141, 2013. [4] E.A. Najafabadi, S.S. Pimplikar; “The significant Causes and effects of delays in Ghadir 2206 residential project,” IOSR Journal of Mechanical and Civil Engineering, Vol. 7, No. 4, pp. 75-81, 2013. [5] P. González, V. González, K. Molenaar, F. Orozco; “Analysis of Causes of Delay and Time Performance in Construction Projects,” Journal of Construction Engineering and Management, Vol. 140, No. 1, pp. 04013027, 2014. [6] P.F. Kaming, P.O. Olomolaiye, G.D. Holt, F.C. Harris; “Factors influencing construction time and cost overruns on high-rise projects in Indonesia,” Construction Management and Economics, Vol. 15, No. 1, pp. 83-94, 1997. [7] A.S. Faridi, S.M. El?Sayegh; “Significant factors causing delay in the UAE construction industry,” Construction Management and Economics, Vol. 24, No. 11, pp. 1167- 1176, 2006. [8] S.A. Assaf, S. Al-Hejji; “Causes of delay in large construction projects,” International Journal of Project Management, Vol. 24, No. 4, pp. 349-357, 2006. [9] A.A. Aibinu, G.O. Jagboro; “The effects of construction delays on project delivery in Nigerian construction industry,” International Journal of Project Management, Vol. 20, No. 8, pp. 593-599, 2002. [10] M. Sambasivan, Y.W. Soon; “Causes and effects of delays in Malaysian construction industry,” International Journal of Project Management, Vol. 25, No. 5, pp. 517- 526, 2007. [11] R.F. Aziz; “Ranking of delay factors in construction projects after Egyptian revolution,” Alexandria Engineering Journal, Vol. 52, No. 3, pp. 387-406, 2013. [12] M. Abd El-Razek, H. Bassioni, A. Mobarak; “Causes of Delay in Building Construction Projects in Egypt,” Journal of Construction Engineering and Management, Vol. 134, No. 11, pp. 831-841, 2008. [13] H. Doloi, A. Sawhney, K.C. Iyer, S. Rentala; “Analysing factors affecting delays in Indian construction projects,” International Journal of Project Management, Vol. 30, No. 4, pp. 479-489, 2012. [14] S.S.S. Gardezi, I.A. Manarvi, S.J.S. Gardezi; “Time Extension Factors in Construction Industry of Pakistan,” Procedia Engineering, Vol. 77, No. 0, pp. 196-204, 2014. [15] M.D.M. Rahman, Y.D. Lee, D.K. Ha; “Investigating Main Causes for Schedule Delay in Construction Projects in Bangladesh,” Journal of Construction Engineering and Project Management, Vol. 4, No. 3, pp. 33-46, 2014. [16] M. Khoshgoftar, A.H.A. Bakar, O. Osman; “Causes of Delays in Iranian Construction Projects,” International Journal of Construction Management, Vol. 10, No. 2, pp. 53-69, 2010. [17] A.H. Alavifar, S. Motamedi, Identification, Evaluation and Classification of Time Delay Risks of Construction Project in Iran, in: International Conference on Industrial Engineering and Operations Management, IEOM, Bali, Indonesia, 2014, pp. 919-929. [18] P. Ghoddousi, M.R. Hosseini; “A survey of the factors affecting the productivity of construction projects in Iran,” Technological and Economic Development of Economy, Vol. 18, No. 1, pp. 99-116, 2012. [19] H. Khalafizadeh, R.T. Mirhosseini, O. Tayari; “Investigating causes of delay in construction projects and presenting a solution (Case study of northwest projects of Iran),” New York Science Journal, Vol. 7, No. 10, pp. 43-47, 2014. [20] T. Pourrostam, A. Ismail; “Significant Factors Causing and Effects of Delay in Iranian Construction Projects,” Australian Journal of Basic and Applied Sciences, Vol. 5, No. 7, pp. 450-456, 2011. [21] B. Akinci, M. Fischer; “Factors Affecting Contractors’ Risk of Cost Overburden,” Journal of Management in Engineering, Vol. 14, No. 1, pp. 67-76, 1998. [22] A. Bhargava, P.C. Anastasopoulos, S. Labi, K.C. Sinha, F.L. Mannering; “Three-Stage Least-Squares Analysis of Time and Cost Overruns in Construction Contracts,” Journal of Construction Engineering and Management, Vol. 136, No. 11, pp. 1207-1218, 2010. [23] H. Doloi; “Cost Overruns and Failure in Project Management: Understanding the Roles of Key Stakeholders in Construction Projects,” Journal of Construction Engineering and Management, Vol. 139, No. 3, pp. 267-279, 2013. [24] A. Enshassi, J. Al-Najjar, M. Kumaraswamy; “Delays and cost overruns in the construction projects in the Gaza Strip,” Journal of Financial Management of Property and Construction, Vol. 14, No. 2, pp. 126-151, 2009. [25] Y. Frimpong, J. Oluwoye, L. Crawford; “Causes of delay and cost overruns in construction of groundwater projects in a developing countries; Ghana as a case study,” International Journal of Project Management, Vol. 21, No. 5, pp. 321-326, 2003. [26] C.T. Jahren, A.M. Ashe; “Predictors of Cost?Overrun Rates,” Journal of Construction Engineering and Management, Vol. 116, No. 3, pp. 548-552, 1990. [27] R.L. Daft, Organization Theory and Design, Eleventh Edition ed., South-Western College Pub, USA, 2013. [28] J. Reyers, J. Mansfield; “The assessment of risk in conservation refurbishment projects,” Structural Survey, Vol. 19, No. 5, pp. 238-244, 2001. [29] P.A. Koushki, K. Al?Rashid, N. Kartam; “Delays and cost increases in the construction of private residential projects in Kuwait,” Construction Management and Economics, Vol. 23, No. 3, pp. 285-294, 2005. [30] T. Lo, I. Fung, K. Tung; “Construction Delays in Hong Kong Civil Engineering Projects,” Journal of Construction Engineering and Management, Vol. 132, No. 6, pp. 636-649, 2006.
Keywords
Municipal construction project; Cost overruns; Delay; Developing countries; Urban projects


References
[1] Y.-M. Cheng; “An exploration into cost-influencing factors on construction projects,” International Journal of Project Management, Vol. 32, No. 5, pp. 850-860, 2014. [2] Z. Shehu, I.R. Endut, A. Akintoye, G.D. Holt; “Cost overrun in the Malaysian construction industry projects: A deeper insight,” International Journal of Project Management, Vol. 32, No. 8, pp. 1471-1480, 2014. [3] G.J. Sweis, R. Sweis, M.A. Rumman, R.A. Hussein, S.E. Dahiya; “Cost overruns in public construction projects: the case of Jordan,” Journal of American Science, Vol. 9, No. 7, pp. 134-141, 2013. [4] E.A. Najafabadi, S.S. Pimplikar; “The significant Causes and effects of delays in Ghadir 2206 residential project,” IOSR Journal of Mechanical and Civil Engineering, Vol. 7, No. 4, pp. 75-81, 2013. [5] P. González, V. González, K. Molenaar, F. Orozco; “Analysis of Causes of Delay and Time Performance in Construction Projects,” Journal of Construction Engineering and Management, Vol. 140, No. 1, pp. 04013027, 2014. [6] P.F. Kaming, P.O. Olomolaiye, G.D. Holt, F.C. Harris; “Factors influencing construction time and cost overruns on high-rise projects in Indonesia,” Construction Management and Economics, Vol. 15, No. 1, pp. 83-94, 1997. [7] A.S. Faridi, S.M. El?Sayegh; “Significant factors causing delay in the UAE construction industry,” Construction Management and Economics, Vol. 24, No. 11, pp. 1167- 1176, 2006. [8] S.A. Assaf, S. Al-Hejji; “Causes of delay in large construction projects,” International Journal of Project Management, Vol. 24, No. 4, pp. 349-357, 2006. [9] A.A. Aibinu, G.O. Jagboro; “The effects of construction delays on project delivery in Nigerian construction industry,” International Journal of Project Management, Vol. 20, No. 8, pp. 593-599, 2002. [10] M. Sambasivan, Y.W. Soon; “Causes and effects of delays in Malaysian construction industry,” International Journal of Project Management, Vol. 25, No. 5, pp. 517- 526, 2007. [11] R.F. Aziz; “Ranking of delay factors in construction projects after Egyptian revolution,” Alexandria Engineering Journal, Vol. 52, No. 3, pp. 387-406, 2013. [12] M. Abd El-Razek, H. Bassioni, A. Mobarak; “Causes of Delay in Building Construction Projects in Egypt,” Journal of Construction Engineering and Management, Vol. 134, No. 11, pp. 831-841, 2008. [13] H. Doloi, A. Sawhney, K.C. Iyer, S. Rentala; “Analysing factors affecting delays in Indian construction projects,” International Journal of Project Management, Vol. 30, No. 4, pp. 479-489, 2012. [14] S.S.S. Gardezi, I.A. Manarvi, S.J.S. Gardezi; “Time Extension Factors in Construction Industry of Pakistan,” Procedia Engineering, Vol. 77, No. 0, pp. 196-204, 2014. [15] M.D.M. Rahman, Y.D. Lee, D.K. Ha; “Investigating Main Causes for Schedule Delay in Construction Projects in Bangladesh,” Journal of Construction Engineering and Project Management, Vol. 4, No. 3, pp. 33-46, 2014. [16] M. Khoshgoftar, A.H.A. Bakar, O. Osman; “Causes of Delays in Iranian Construction Projects,” International Journal of Construction Management, Vol. 10, No. 2, pp. 53-69, 2010. [17] A.H. Alavifar, S. Motamedi, Identification, Evaluation and Classification of Time Delay Risks of Construction Project in Iran, in: International Conference on Industrial Engineering and Operations Management, IEOM, Bali, Indonesia, 2014, pp. 919-929. [18] P. Ghoddousi, M.R. Hosseini; “A survey of the factors affecting the productivity of construction projects in Iran,” Technological and Economic Development of Economy, Vol. 18, No. 1, pp. 99-116, 2012. [19] H. Khalafizadeh, R.T. Mirhosseini, O. Tayari; “Investigating causes of delay in construction projects and presenting a solution (Case study of northwest projects of Iran),” New York Science Journal, Vol. 7, No. 10, pp. 43-47, 2014. [20] T. Pourrostam, A. Ismail; “Significant Factors Causing and Effects of Delay in Iranian Construction Projects,” Australian Journal of Basic and Applied Sciences, Vol. 5, No. 7, pp. 450-456, 2011. [21] B. Akinci, M. Fischer; “Factors Affecting Contractors’ Risk of Cost Overburden,” Journal of Management in Engineering, Vol. 14, No. 1, pp. 67-76, 1998. [22] A. Bhargava, P.C. Anastasopoulos, S. Labi, K.C. Sinha, F.L. Mannering; “Three-Stage Least-Squares Analysis of Time and Cost Overruns in Construction Contracts,” Journal of Construction Engineering and Management, Vol. 136, No. 11, pp. 1207-1218, 2010. [23] H. Doloi; “Cost Overruns and Failure in Project Management: Understanding the Roles of Key Stakeholders in Construction Projects,” Journal of Construction Engineering and Management, Vol. 139, No. 3, pp. 267-279, 2013. [24] A. Enshassi, J. Al-Najjar, M. Kumaraswamy; “Delays and cost overruns in the construction projects in the Gaza Strip,” Journal of Financial Management of Property and Construction, Vol. 14, No. 2, pp. 126-151, 2009. [25] Y. Frimpong, J. Oluwoye, L. Crawford; “Causes of delay and cost overruns in construction of groundwater projects in a developing countries; Ghana as a case study,” International Journal of Project Management, Vol. 21, No. 5, pp. 321-326, 2003. [26] C.T. Jahren, A.M. Ashe; “Predictors of Cost?Overrun Rates,” Journal of Construction Engineering and Management, Vol. 116, No. 3, pp. 548-552, 1990. [27] R.L. Daft, Organization Theory and Design, Eleventh Edition ed., South-Western College Pub, USA, 2013. [28] J. Reyers, J. Mansfield; “The assessment of risk in conservation refurbishment projects,” Structural Survey, Vol. 19, No. 5, pp. 238-244, 2001. [29] P.A. Koushki, K. Al?Rashid, N. Kartam; “Delays and cost increases in the construction of private residential projects in Kuwait,” Construction Management and Economics, Vol. 23, No. 3, pp. 285-294, 2005. [30] T. Lo, I. Fung, K. Tung; “Construction Delays in Hong Kong Civil Engineering Projects,” Journal of Construction Engineering and Management, Vol. 132, No. 6, pp. 636-649, 2006.
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