Impact of Cost Control Techniques on Cost Overruns in Construction Projects

S. N. Malkanthi; A. G. D. Premalal; R. K. P. C. B. Mudalige

doi:10.4038/engineer.v50i4.7275

Factors affecting the selection of effective cost control techniques in the UK construction industry

Journal of Financial Management of Property and Construction ◽

10.1108/jfmpc-07-2020-0050 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Adekunle Sabitu Oyegoke ◽

Robert Powell ◽

Saheed Ajayi ◽

Godawatte Arachchige Gimhan Rathnagee Godawatte ◽

Temidayo Akenroye

Keyword(s):

Construction Industry ◽

Cost Control ◽

Research Approach ◽

Cost Overruns ◽

Content Type ◽

Factors Affecting ◽

Control Techniques ◽

Effective Cost ◽

The Uk ◽

Selection Of

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.

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Analysis of Cost Control Techniques Used on Building Construction Projects in Sri Lanka

SSRN Electronic Journal ◽

10.2139/ssrn.3311303 ◽

2018 ◽

Author(s):

N. H. K. Cooray ◽

H. M. D. N. Somathilake ◽

Mihiri Wickramasinghe ◽

T. D. S. H. Dissanayke ◽

D. M. M. I. Dissanayake

Keyword(s):

Sri Lanka ◽

Construction Projects ◽

Cost Control ◽

Building Construction ◽

Control Techniques

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Time and cost control in construction projects in southeast Mexico

Ingeniería Investigación y Tecnología ◽

10.22201/fi.25940732e.2017.18n4.036 ◽

2017 ◽

Vol 18 (4) ◽

pp. 411-422

Author(s):

Rómel Gilberto Solís-Carcaño ◽

◽

Carmen Sarahí Morfín-García ◽

Jesús Nicolás Zaragoza-Grifé ◽

◽

...

Keyword(s):

Construction Projects ◽

Cost Control ◽

Southeast Mexico

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An Integrated Decision Support Model Based on BWM and Fuzzy-VIKOR Techniques for Contractor Selection in Construction Projects

Sustainability ◽

10.3390/su13126933 ◽

2021 ◽

Vol 13 (12) ◽

pp. 6933

Author(s):

Aziz Naghizadeh Vardin ◽

Ramin Ansari ◽

Mohammad Khalilzadeh ◽

Jurgita Antucheviciene ◽

Romualdas Bausys

Keyword(s):

Construction Projects ◽

Construction Project ◽

Water Channel ◽

Multicriteria Decision Making ◽

Decision Support Model ◽

Cost Overruns ◽

Contractor Selection ◽

Model Based ◽

Fuzzy Vikor ◽

Bid Price

Sustainable development of any country to some extent depends on successful accomplishment of construction projects, particularly infrastructures. Contractors have a key role in the success of these projects. Hence, the selection of a competent contractor as a complicated and hard decision process has a vital importance in the destiny of any construction project. Contractor selection is in essence a multicriteria decision-making that ought to encompass so many aspects of the project and the client’s requirements on one hand and the capabilities and past records of the contractors on the other hand. Failure in selecting a competent contractor may cause time and cost overruns; quality shortcomings; increasing in claims, disputes and change orders; and even failure of the project. In spite of deficiencies of selecting a contractor by the rule of “the lowest bid price”, it still prevails in many countries including Iran. In this paper, a new contractor selection model based on the best-worst method (BWM) and well-known Fuzzy-VIKOR techniques is proposed as a solution to overcome the deficiencies of the traditional “lowest bid price” rule. An illustrative example of a water channel construction project verified the applicability of the proposed model in practice.

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Investigating Rework: Insights from the Malaysian Construction Industry

ASM Science Journal ◽

10.32802/asmscj.2020.636 ◽

2021 ◽

Vol 14 ◽

pp. 1-9

Author(s):

Jeffrey Boon Hui Yap ◽

Shi Min Tan

Keyword(s):

Quality Management ◽

Construction Industry ◽

Construction Projects ◽

Poor Quality ◽

Project Performance ◽

Statistical Techniques ◽

Cost Overruns ◽

Delivery Performance ◽

Communication Design ◽

Design Changes

Construction practitioners recognise that rework is undesirable due to the detrimental effects. While rework literature has examined rework causation factors in construction projects, the problem continues to plague the industry resulting in poor delivery performance. To better understand this phenomenon and given the scarcity of Malaysian-based rework study, a questionnaire survey involving 130 Malaysian construction practitioners (consultants, contractors and clients) were undertaken to obtain feedback about nature, implications, causes and solutions for rework. Data were analysed using descriptive statistical techniques to prioritise the variables studied. From the analyses, rework is a causal factor for delays and cost overruns, higher wastage and productivity inhibitor. The findings revealed the leading causes of rework are poor quality management, improper planning, lack of communication, design changes and poor subcontractor management. Some practical rework minimisation approaches are also suggested to better manage and prevent rework towards enhanced project performance.

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Scope Reductions as Tool for Cost Control in Construction Projects

Project Management ◽

10.4018/978-1-5225-0196-1.ch036 ◽

2016 ◽

pp. 733-748

Author(s):

Nils O. E. Olsson

Keyword(s):

Construction Projects ◽

Best Practice ◽

Cost Control ◽

Actual Use ◽

Scope Management ◽

High Degree

Scope management is a key issue in construction projects. This paper studies scope reductions. Potential reductions of project scope as well as budget contingencies have been a tool for cost control of governmental investments in Norway since 2001. This paper studies implementation of such reduction in major construction projects in different governmental sectors. Project representatives were contacted to obtain information about actual use of pre-defined potential scope reductions. Eight of the 14 studied projects did not implement any of the predefined reductions. Six projects implemented some of the reductions. These reductions were mainly general reductions of the quality of the facilities. The Norwegian reduction lists are based on an unusually high degree of specification of potential actions for cost control. International best practice is more concerned with general approaches. To function as intended, possible reductions should be possible to implement late in a project. General contingencies appear to be more effective for cost control than predefined scope reductions.

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