construction delay causing risk on time and cost

Topics: Construction, Cost overrun, Cost Pages: 103 (7276 words) Published: February 28, 2014
Construction Delays Causing Risks on Time and
Cost - a Critical Review
Chidambaram Ramanathan, SP Narayanan and Arazi B Idrus, (Universiti Teknologi Petronas, Malaysia)

There is an increase in the number of construction projects experiencing extensive delays leading to exceeding the initial time and cost budget. This paper reviews 41 studies around the world which has surveyed the delay factors and classified them into Groups. The main purpose of this paper is to review research which has categorized the causes responsible for time delays and cost overruns in projects. The intention was to see whether these causes are valid for projects being executed in Sabah East Malaysia allowing a mitigation plan to be prepared. The collected list has 113 causes for delays which were categorized into 18 different groups. Most of the research has analysed the responses from Questionnaire surveys. The collected data are used to rank the problem factors. The data are further used to investigate and analyse the reported “Importance Index, Frequency Index, Severity Index, Relative Importance Index, Relative Importance Weight, Weighted Average, Mean, Standard Deviation and Variance”. The collective comparison has revealed that the ranking given by all the researchers is not the same. Further each and every study has different rank ratings from different group. This review paper attempts to provide an updated compilation of the earlier studies on ranking of the delay causers, which are never similar and constant for universal projects. From the critical review, it is concluded that this type of research requires a different method or approach to generate meaningful answers and that there is a strong case against opinion surveys. Keywords: Construction delays, Cost risk, Time risk, Project Management

The purpose of this study is to critically review and identify the applicability of past studies on determining the factors causing time delays and cost overrun in current projects. This goal has been accomplished by reviewing articles published during the last 15 years (since 1995) in various project management journals like: International Journal of Project Management (IJPM), Journal of Construction Management Economics (JCME), Journal of Management in Engineering (JME), Engineering Construction and Architectural Management Journal (ECAMJ) and others.

The biggest customer of the construction industry in most countries is the government (Okpala and Aiekwu, 1988). To the dislike of owners, contractors and consultants, many government projects experience extensive delays and thereby exceed the initial time and cost estimates (Odeh and Bataineh, 2002). This problem is more evident in the traditional type of contracts in which the contract is awarded to the lowest bidder. This procurement strategy is adopted by majority of government projects in developing countries. The Latham Report (Latham, 1994) suggested that ensuring timely delivery of projects is one of the important needs of clients of the construction industry. Severe criticisms of the industry arise if it takes much longer than the stipulated project time (Bennett et al., 1979; Flanagan et al., 1986). Completing projects on time is an indicator of an efficient construction industry (NEDO, 1988). Contractors are primarily

Australasian Journal of Construction Economics and Building

concerned with quality, time and cost and yet the majority of construction projects are procured on the basis of only two of these parameters, namely time and cost (Bennet and Grice, 1990). The literature emphasises time as an indicator for project success. The construction process can be divided into three important phases, i.e. project conception, project design and project construction. Usually, the vast majority of project delays occur during the ‘construction’ phase, where many unforeseen factors are always involved (Chan and Kumaraswamy, 1997). In construction, delay...
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