• Journal of Construction Engineering and Project Management
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• v.4 no.1
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• pp.15-28
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• 2014

Completing road construction projects within the budget and time has been a problem for the Tanzania National Roads Agency (TANROADS); and the major problem highlighted in almost all projects being inadequate design. However, the extent to which inadequate design contributes to both time and cost overruns and its causes remained under-studied. The objective of this study is therefore to determine the extent of the effect of inadequate design, its causes and remedial measures. The methodology used in this study includes reviewing recent projects completion reports, holding roundtable discussions with consultants and TANROADS officials and analyzing the information. Cost and time overruns for the reviewed projects averaged 44% and 26% respectively. Similarly, the extents to which inadequate design contributes to cost and time overruns were on average found to be 61% and 85% respectively. The overruns are predominantly related to problems that occurred during the design process. To alleviate the problem, TANROADS is advised to improve the management of design projects, enhance the process of reviewing design reports, improve the design process including introducing Road Safety Audit and geometric design manuals, and increase staff to match the work-load.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.9
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• pp.389-400
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• 2020

A construction project is a designed product made up of labors, materials, and installations in the project positioned on the ground and may include the underground and ground section, and the section in water or on the water surface. It is a civil, industrial, transport, agricultural and rural development, infrastructure, or some other. A key phase in the life cycle of these construction projects is the implementation when building products are made directly with workers, equipment, materials, and managers. If there is a lack of management experience, information, and problem-solving solutions to tackle the risks faced by contractors, especially foreign ones, will fail in controlling the project's cost. This study was conducted with investigations, discussions, and evaluation of the factors that lead to cost overruns in the construction projects of international contractors in Vietnam. The principal component analysis (PCA) showed that those factors that influence cost overruns these construction projects fall into five general groups, including factors related to (i) the owners, (ii) the foreign contractors, (iii) the subcontractors and suppliers, (iv) state management, and (v) the project itself. Besides, the study proposes solutions to limit cost overruns in construction projects and improve the profitability of international contractors in Vietnam.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2007.11a
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• pp.728-731
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• 2007

In-planned duration and cost at project closing are the two of criteria of successful project and successful project management. In Vietnam, regularly, construction projects are delayed and their costs are overrun. This research employed a questionnaire survey to elicit the causes of this situation by interviewing 87 Vietnamese construction experts. After processing data, 21 causes of delay and cost overruns appropriate with building and industrial project in construction stage were inferred and ranked. Spearman's rank correlation tests showed that there're no differences in the viewpoints between parties in project.

• Korean Journal of Construction Engineering and Management
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• v.25 no.3
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• pp.27-36
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• 2024

The effective control of cost overrun is a crucial issue for construction companies to secure profitability. Especially in situations where cost pressures are significant due to factors such as rising raw material prices and increased financial costs due to high-interest rate policies, cost overruns resulting from project failures have a highly detrimental impact on the profitability of construction firms. The objective of this study is to analyze the current status of cost overrun control measures adopted by construction companies using the IPA technique and provide key characteristics and implications. The IPA analysis results showed that practitioners in general contractors exhibit a high level of interest and effort regarding cost overrun while the performance level is relatively low. Nevertheless, the measures considered important to control cost overruns generally show a high tendency for execution as well. Cost overrun control measures that show high importance but low execution are primarily related to collaboration and communication sectors. To effectively control cost overruns, enhancing collaboration and communication with construction supervisors/CM, headquarters, and regulatory authorities emerged as the most urgent need. Through this study, the current status and areas for improvement regarding cost overrun control measures in general contractors can be identified. This can be valuable for deriving directions and enhancements for future cost overrun control strategy development.

• ETRI Journal
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• v.9 no.3
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• pp.139-156
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• 1987

The problems in software cost management are well known. Cost estimates are too low. Software development projects frequently have cost overruns, which are due to poor estimates. A fair amount of work have been done toward developing cost estimation models. These models vary in their outputs (e. g., total cost, manning schedule) and in the factors used to calculate their estimates. They also vary with regard to the type of formula, parameters, use of previous data, and staffing considerations. This paper will distinguish them by the type of formula they use to calculate total effort and staffing level, and will discuss enough models to demonstrate the characteristics of each model category.

• International conference on construction engineering and project management
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• 2013.01a
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• pp.36-41
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• 2013

With the increased interest in green buildings, the building industry has been experiencing a fast-growing demand for LEED (Leadership in Energy and Environmental Design) certification for the last decade. Still, it is not unusual to see various barriers and issues during its implementation, and experience tells that they can result in harming the overall project performance with reworks, lower productivity, schedule delays, and cost overruns. In order to better understand the industry's observation on issues and their consequences during LEED implementation, we distributed an online survey, and a total of 53 responses were received. The survey results indicate that (1) both designers and non-designers (e.g., contractors) select 'added costs to design and construction' as the biggest barrier; (2) both designers and non-designers select 'decision made too late in the design process' as the most frequently observed issue; and (3) non-designers indicate higher perceived severity in every consequence criteria than designers. The statistical analyses reveal that cost overruns are the most severe impact observed and have a statistically significant relationship with responses in regard to the barrier to LEED implementation.

• International conference on construction engineering and project management
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• 2022.06a
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• pp.1240-1240
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• 2022

Construction projects are fraught with risks from cost or other overruns to accidents along with other issues. This is true whether the relevant organization is an owner, general contractor, CM, specialty-trade contractor, or other entity. When cost issues or other issues confront arise, how should an organization proceed whether attempting to gain additional compensation in terms of cost/other damages or protecting the same against such claims if they do not appear to be warranted? Enter construction cost forensics. This presentation will focus on strategies/techniques with construction cost forensics in these areas in order to be successful. Covered techniques include those to develop and analyze claims including fundamental construction cost analysis techniques. When an unexpected event disrupts a construction project, using sound analytical methods to identify the cause and quantify the extent of the issue will be important for negotiating a fair result or for obtaining a successful outcome in arbitration or litigation. Key examples of uncovering issues via construction cost forensics will be covered in this presentation.

• Architectural research
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• v.16 no.2
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• pp.75-80
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• 2014

Risks, uncertainties, and associated cost overruns are critical problems for construction projects. Cost contingency is an important funding source for these unforeseen events and is included in the base estimate to help perform financially successful projects. In order to predict more accurate contingency, many empirical models using regression analysis and artificial neural network method have been proposed and showed its viability to minimize prediction errors. However, categorical factors on contingency cannot have been treated and thus considered in these empirical models since those models are able to treat only numerical factors. This paper identified potential factors on contingency in transportation construction projects and evaluated categorical factors using the one-way ANOVA statistical method. Among factors including project work type, delivery method type, contract agreement type, bid award type, letting type, and geographical location, two factors of project work type and contract agreement type were found to be statistically important on allocating cost contingency.

• Korean Journal of Construction Engineering and Management
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• v.18 no.3
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• pp.105-116
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• 2017

In recent years, large Korean construction companies have suffered serious losses in their overseas business. Many practitioners and researchers have analyzed causes of cost overrun in these projects. However, these arguments have not been empirically verified based on acutal project cases. This study investigated cost overrun rate, contingency, allowance, predicted risk before bidding, and actual and residual risk after award in the 67 international infrastructure projects conducted by 13 large construction companies. The causes of cost overruns are derived as follows. First, they identified the possibility of cost overrun to some extent before the bidding, but did not reflect the enough risk money to bid price. In particular, this behavior was more severe in badly cost-overrun projects. Second, the causes of cost overrun were more influenced by external environmental risk than internal capability risk. However, the internal risk in badly cost-overrun projects was relatively high compared to cost-underrun projects. Third, badly cost-overrun projects failed to mitigate risk. However, cost underrun projects were affected more by low exterior risk conditions than by well mitigated risk. This study provides more informed knowledge in controlling project costs in international infrastructure projects.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.35
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• pp.179-219
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• 2007

Cross-border supply chains undergone complexity in the global trade process, unpredictability and continually evolving regulations and information requirements. Under these circumstances, longer lead time inhibiting quick response to market demands, unanticipated supply chain costs eroding product cost savings, compliance and documentation errors causing delays and fines are challenging global trade companies when they execute global business. These problems are mainly caused by unautomated, unintegrated process which lead to longer and more unpredictable lead times, slower cash flow, cost overruns, and ultimately lower profits and less satisfied customers. Complex and unpredictable global trade environment requires global trade companies of global trade management functions to automate and control this complex environment for driving out cost, time and risk from their business. Global trade management allows cost savings, supply chain efficiencies and improved compliance through improving global supply chain visibility, facilitating cash flow by supply chain financing, enhancing supply chain security and risk management.